Exhibit 99.1
Materion Corporation
Investor Presentation
November 2011
Forward -Looking Statements
These slides contain (and the accompanying oral discussion will contain) “forward -looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors that could cause the actual results of the Company to differ materially from the results expressed or implied by these statements, including health issues, litigation and regulation relating to our business, our ability to achieve and/or maintain profitability, significant cyclical fluctuations ‘ in our customers businesses, competitive substitutes for our products, risks associated with our international operations, including foreign currency rate fluctuations, energy costs and the availability and prices of raw materials, the timing and ability to achieve further efficiencies and synergies resulting from our name change and product line alignment u ,nder the Materion name and brand and other factors disclosed in periodic reports filed with the Securities and Exchange Commission. Consequently these forward -looking statements should be regarded as the Company’s current plans, estimates and beliefs.
The Company does not undertake and specifically declines any obligation to publicly release the results of any revisions to these forward -looking statements that may be made to reflect any future events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events .
M A T E R I O N T O D A Y :
New Name, Same Impressive Performance
Sales Operating profit Repositioning growth growth of company
(2005 – 2010) (2005 – 2010)
19% 30% Successful
CAGR CAGR
T H E S I S
Positioned to Deliver Long -Term, Sustainable Growth
… Leveraging a
A company … Executing high value-added with a strong a focused business platform … growth plan model…
The Repositioning of Materion
Prior to 2002 2002 – 2010 2011 +
Metals and Repositioning Sustained mining focus growth
Successful Repositioning – Snapshot
2002 2010
Revenues $373M A $1.3B
Revenue % in
47% A 75% Advanced Materials Sales per employee $200 A $524 (thousands)
Debt-to-Debt-Plus-Equity 43% A 18%
Working capital
41% A 25% % of sales
Cyclicality High A Low
Operating Businesses are Well -Positioned and Growing
Business End Markets Products Sales Growth
(Examples) (Examples) (2002-2010)
Advanced Materials • Wireless
• PVD targets
• LED
• Optical / medical
• Optical coatings
453%
• Medical • Electronic packaging 75% of revenues • Alternative • Inorganic powders energy
Integrated Metals • Wireless
• Electronic connectors
• Oil & gas • Directional drilling
• Aerospace components 68%
• Heavy equipment • Optical structures 25% of revenues • Defense • Bushings and bearings
Positioned in Diverse Set of High -Growth Markets
Growth
Cellular phones (smartphones),
LED’s Tablet computers
Defense
Notebooks Optics
LCD
Commercial Aerospace Telecom Infrastructure Alternative Energy
Space / Science Medical Devices Disk Heavy Drives Equipment
Entered multiple leading -edge growth markets since 2002
High Operating Margins
Removing High Value Metals Clarifies True Margins
2010
Operating Operating Profit % of Profit % Value-Added (1)
Integrated Metals 11 – 13% 14 – 16% Advanced Materials 5 – 7% 22 – 24% Company 5 – 7% 13 – 15%
9 Note (1): Excludes high value metals from sales
A Global Platform
Operations in US Significant and Expanding and 11 Countries International Sales 2010
28% “Direct” International Sales
Expect “direct” international sales
Customers in >50 countries to be 40—50% in 3-5 years
10
T H E S I S
Positioned to Deliver Long -Term, Sustainable Growth
… Leveraging a
A company … Executing high value-added with a strong a focused business platform … growth plan model…
11
High Value -Added Business Model
1. Target high growth 2. Own fast growing markets niches
5. Ensure 3. Expand with financial innovative discipline products
4. Add synergistic acquisitions
12
1. Target High Growth, Leading -Edge Markets
Q3 2011 Current
Market % of Value—2011 Key Drivers Added Sales Trends
• Smartphone growth Consumer Electronics 22% • Tablet computers & LEDs
• Miniaturization
• DoD & foreign military budgets Defense & Science 15% • Demand for communications satellites
• High performance optical devices
Industrial Components & • New airplane builds & retrofits 14% • Increasing air travel Commercial Aerospace • Heavy equipment builds
Telecommunications • Global 3G/4G builds
9% • Base stations
Infrastructure • Undersea fiber-optics expansion
• Increasing global car production Automotive Electronics 8% • HEV/EV lithium ion battery components
• Engine control & electronic systems Energy • Directional drilling
8% • Rig counts
• Solar, batteries & smart grid devices
Medical 6% • Glucose testing
• Diagnostics equipment
13
1. Target High Growth, Leading -Edge Markets
Reportable Segments
ADVANCED MATERIAL PERFORMANCE BERYLLIUM & TECHNICAL TECHNOLOGIES ALLOYS COMPOSITES MATERIALS
Precious, Non-precious,
Specialty Metal and Inorganic Bulk and Strip Form Products Beryllium and Beryllia Ceramic Specialty Strip Metal Materials; Electronic Packages and Beryllium Hydroxide Products Products Key Markets and Components
CONSUMER S S S S ELECTRONICS
DEFENSE & SCIENCE S S S S INDUSTRIAL
COMPONENTS & S S S COMM. AEROSPACE
TELECOM S S S S INFRASTRUCTURE
AUTOMOTIVE S S S S ELECTRONICS
ENERGY S S S S
MEDICAL S S S S
14
2. Own The Niche – Examples
Leading position
• Smartphone applications in niche – currently in 90% of all smartphones, with 9 expected device penetration of 50% in 2011
• Optical coatings
– highly sophisticated uses for defense, thermal 9 imaging, space and medical applications
• Only fully integrated producer of beryllium
– one-of-a-kind business 9
• Unique copper -nickel material ToughMet TM
– multiple advanced applications growing at 9 over 30% annually
15
3. Continually Develop Innovative Products
• Customer -centric product development
• Active research programs
• New product areas include
– LEDs
– Medical
– Commercial Optics
– Disk drive arms
– Solar
– Batteries
– Science
– Commercial Aerospace
16
4. Synergistic Acquisitions – Strong Record
Acquisitions 2005-2011 – Impact
Add complementary Expand market Accretive in products / technolo gy position year 1
OMC – shield kit cleaning 9 9 9 TFT – thin film coatings 9 9 9 CERAC – inorganic chemicals 9 9 9
Techni-Met – thin film coatings 9 9 9
Barr – thin film coatings 9 9 9
Academy – precious metals 9 9 9
9 9
EIS Optics – thin film coatings TBD
Added over $300M to sales and approximately 25% of company profit
17
4. Synergistic Acquisitions
Case Study of Growing a Niche Business
– Optical Filters and Medical Coatings
(Pro-Forma Revenues)
$140M
EIS Optics • Positioned in $1.2B+ market growing (2011) at 11% annually
• Markets served include: defense,
Barr
(2009) medical , , ace aerosp energy, semiconductor, telecommunications, lighting and astronomy Techni- • The recent acquisition of EIS Optics
Met
(2008) continues to expand our global footprint in Asia $9M
TFT
2006 2011
18
5. Ensure Financial Discipline
Maintain strong Strong balance sheet cash flow
Debt-to-Debt-Plus-Equity
30% Maximum 30% • Cash flow from operations Resources to $30M—$75M annually for finance
21%
18% the past five years acquisitions of
20%
$50M to $100M
• Capex below depreciation annually
10%
• Reduction in working capital goal to <20% sales
0% 2005 2010 After $175M in acquisitions (net)
19
T H E S I S
Positioned to Deliver Long -Term, Sustainable Growth
… Leveraging a
A company … Executing high value-added with a strong a focused business platform … growth plan model…
20
Financial Goals Next 3-5 Years
2010 Next 3-5 years
Revenue growth – organic 35% >10%
$50—$100M Acquisitions $21M
per year
Margins (OP % VA) 14% 14%—18% Working capital % sales % 25 <20% Debt to Debt-Plus-Equity 18% <30% ROIC (pre-tax) 17% >20%
21
Continuing to Execute Three Point Strategy
Increasing Shareholder Value
1 | | Grow and diversify revenue base |
3 | | Improve fixed and working capital utilization |
22
S T R A T E G Y # 1 : G R O W T H
Expand and Diversify Revenue Base
• Targeting expansion in growth markets including:
– smart mobile devices, 3G / 4G, commercial aerospace, oil & gas, alternative energy, optics, LED / LCD
• Ongoing global expansion
– Asia
• Strategic acquisition A fast accretion
– Technology
– Global reach
23
S T R A T E G Y # 1 : G R O W T H
Strategy in Action: Outgrowing Growth Markets
Growth of Materion Growth of Materion
Oil and Gas Sales vs. Market Aerospace Sales vs Market
5.00
4.50
4.00
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00
24
S T R A T E G Y # 2 : M A R G I N S
Expand Margins – Key Drivers
(OP % VA)
14—18% 3 12—14% 2
1 | | Higher value Cost Lean Sigma added products reductions operating efficiency |
Margin Target Today Margin
25
S T R A T E G Y # 3 : C A P I T A L E F F I C I E N C Y
Improve Fixed and Working Capital Efficiency
Improve Workin g Capital Lean Sigma Efficiency
Working capital % of sales
41%
• Cycle time reduction
• Yield improvement
25%
• On-time shipments <20%
2002 2010 Target
Based on 2011 projected sales, each 5% of working capital efficiency = $43M of cash
26
2011 Outlook and Guidance
Revenues EPS
(Billions) $1.56 -$1.58 $2.10 -$2.20 $2.25 $1.3
2010 2011(F) 2010 2011(F)
27
I N S U M M A R Y
Why Invest in Materion Corporation
Niche leader in high-growth markets
Positioning • Global player, strong secular market drivers
• Sustainable long-term growth
Strong performance record Performance • Proven business model
• Target, expand, then own niche
Executing three point strategy
Growth • Clear financial goals, performance continuing to improve
28
Appendix
Applications: Smart Phones
Internal Antenna Contacts Internal Electronics
• Precursor materials for GaAs wafer production
Grounding Clips
Internal Electronics and LED and Audio Jacks
• Thin Film Materials – Power amplifiers, LED, SAW and BAW devices, filters, and ICs
Micro Mezzanine
• Hermetic Solutions for SAW
Connectors for
LCD Screen • Refining / Recycling
• Precision Parts Cleaning
I/O Connector
Contacts Other Smart Phone Applications:
• Circuit Board and IC Inspection
• RoHS Compliance Assurance
Battery Contacts • Cellular Infrastructure with High Power RF Packaging
A-1
Applications: Aerospace
Flight Attendant Jumpseat Spring
Avionics/Electrical Flight Control
Systems Airframe Structure Mechanisms Horizontal Stabilizer & Rudder Attachments
Wing Attachments
Landing Gear Attachments
Hydraulic Systems Engine and Pylon Attachments Doors & Hatches Landing Gear Components
Other Aerospace Applications : Safety Slide Fuel Systems Mechanism • Baggage Inspection
• Nondestructive Evaluation (Cracked Component Detection)
A-2
Applications: Defense
• Infrared Sensors for Fighter Jet and UAV Optical Targeting
• Electronic Packaging for Defense Avionics, Radar and Electronic Countermeasure Systems
• Structural and Electronic Components for Satellites
• X-ray Windows in Security Imaging Systems
• Laser Protection Optical Coatings
• Night Vision System Optics
A-3
Applications: Automotive Electronics
Auto Dimming Mirror Mirror & Windshield Electronic Connectors Air Bag Sensors Connections
Window and Door Turn Signal and Emergency Switches Telematics On Board Flasher Relays Lithium Interconnects Ion Battery
Sensors Engine Efficiency Oxygen LevelFuel Pump and Fuel Sensors
Module Hybrid Vehicle Connectors Motor & Battery Resistors Management Modules Battery & Relay Control Terminals Battery Engine Ignition and Control Modules
Steering Electronic Modules Power ABS Leadframes Lamp Socket Connectors
A-4
Applications: Oil & Gas
Wellhead Control Equipment Under Water Wellhead Equipment Structural Rig
ROV’ s, blow out preventers, hydraulic
Components actuators, control fluid couplings
Directional Drilling Other Oil & Gas Applications: Equipment • Artificial Lift Equipment Drill Bits MWD, LWD, MPT Systems • Elemental Analysis
• Down Hole X-Ray Inspection
A-5
Applications: Solar Energy
Technology: Crystalline Technology: Flexible Solar Cells / Building
Silicon (Si) Integrated Photovoltaic:
Technology: Cadmium Telluride (CdTe)
Interconnect Materials Thin Film Services:
Thin Film (PVD) Materials Front and backplane systems for Solar cells built in flexible substrates to accommodate
Cadmium based solar cell architecture. N and P high efficiency designs. applications such as roofing tiles or defense. type Cadmium Semiconductor materials TCO Transparent Conductive Oxide layers Front and Back? contact layers
Technology: Copper Indium Gallium Selenide (CIGS)
Thin Film (PVD) Materials as well as Powders for Printing CIGS applications Copper Indium Gallium Selenide thin film and screen printing
Technology: Concentrator Photovoltaic (CPV) applications for flexible and rigid solar cells. Thin Film (PVD) Materials Solar technology based on concentrating Solar rays into a semiconductor device via large lens.
Anti? Reflection Coating Materials
Technology: Amorphous Silicon (a? Precious metal contact materials Si, tandem and multi? junction) Thin Film (PVD) Materials Micro Electronic Packaging Products: Silicon based photovoltaic cells Bonding Ribbon ? Au & Ag Front and back contact layers Lead? free Solders TCO Transparent Conductive Oxide layers Metalized Ceramic Substrates
A-6
Applications: Telecommunications Infrastructure
Base Stations
• Coaxial Connectors
• High Power Amplifiers
Local Area Networks
• Shielding
• Modular Jacks
• PCB Sockets
• Processor Sockets
Other Telecommunications Infrastructure Applications
• Undersea Repeater Housings
A-7
Applications: Medical
Seizure Control
• Thin Film Deposition Implantable Radiation Therapy –Electrode – Parkinson’s disease Neutron Reflectors (R&D)
X-Ray Mammography
Cardiac Rhythm Management
Subcutaneous Glucose Analysis • Electronic Interconnects/Com ponents
• Thin Film Coatings – Electrode Monitoring device • Niobium/Titanium Electron Beam Weld
External Glucose Analysis
• Subcutaneous sensors for glucose measurement
Other Medical Applications:
• CT Scan
• Diagnostic X-Rays
• Advanced Drug Delivery Components Insulin Pump • Diagnostic Electronic Components
• EMI Shielding and Grounding • Anesthesia Monitoring Components
• Electrical Terminals in Connectors • Operating Instruments
A-8
Value-Added Sales: Advanced Material Technologies
A-9
Value-Added Sales: Performance Alloys
Q3 2011
A-10
Value-Added Sales: Beryllium and Composites
A-11
Value-Added Sales: Technical Materials
A-12
New Product and Technology Development
Advanced Material Technologies
– Optics Coating Materials and Large Format Components
– Precision Optical Thin Film Coatings (specialty filters)
– Thin Film Electrodes (medical diagnostics)
– Optical package for New Photonics applications
– RF packages for the latest transistor technology (3G and 4G infrastructure)
– Expanded refining/chamber services – Compliment to Thin Film Materials & Coating businesses
– Large format Thin Film Materials , for large area coatings (Energy Solar)
– Solar Panel Thin Film, Concentrator Materials and Barrier Film Coatings
– MEMS and Photovoltaic Packaging Materials
– Nanotechnology Materials
– Materials for High Brightness LEDs
– Specialty Inorganic Compounds (Solar, Security)
– Precious Metal Materials – rod, bar, sheet, slugs, etc.
– Refining and Metal Recovery and Management Services
A-13
New Product and Technology Development
Performance Alloys
– ToughMet® Alloy for High Volume Bearing Applications
– BrushForm 158 for Voice Coil Motor (VCM) applications
– Materion R270 Strip
Beryllium and Composites
– Nearer net shape fabrication (hot isostatic pressing)
– Truextent™ speaker diaphragms
– Coatings
– Nuclear beryllium materials
Technical Materials
– Li lon Battery Interconnects
– Power Electronics
– Solar Leadframe Application
– Medical Applications
– Hard Drives
A-14
