INFICON Holding AG

It's half past nine by my watch, so good morning and welcome everyone. My name is Bernhard Schweitzer, investor relations contact at INFICON. I have the pleasure of hosting the webcast of our third quarter 2025 results conference. With us today are Oliver Wirsch, CEO of INFICON and Matthias Drönble, CFO of INFICON. The management team will first present the results and then take questions. During management's prepared remarks, online participants are kindly requested to turn off their microphones and cameras. During the following Q&A sessions, participants are then invited to switch their microphones and cameras on when asking questions. Participants can add themselves to the queue of people wanting to ask questions by clicking on the Arise My Hand icon. Alternatively, you can also use the chat function in MS Teams. You should have received by now a press release on the Q3 results, together with a link to the accompanying visuals for this web conference. All documents are available for download in the investor section of the Inficon website, inficon.com. I would also like to inform you that we record this web conference to archive the audio file later on the Inficon website. The oral statements made by INFICOM during these sessions may contain forward-looking statements that do not solely relate to historical or current facts. These forward-looking statements are based on the current plans and expectations of our management and are subject to a number of uncertainties and risks that could significantly affect our current plans and expectations, as well as future results of operations and financial conditions. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Having said all that, I would like to hand over now to Oliver Wiersch. Oliver, please.

Thank you very much, Bernhard.

Welcome, everyone. Great for having you here today. Welcome to our news release in June. About the agenda, we have the usual agenda. First, I will tell you a bit more about the markets, the key messages, about the target markets developments and about our full year expectations. And then I will hand over to Matthias Freundli, our CFO, for more details on that. Two free results. So certainly stormy times these days, but at the same time, it's the time for making bold moves, we believe, and it's not the time for hunkering down. And we actually have quite a lot of optimism here, and I will tell you in the next couple of slides why we see it that way, even though, of course, it's also a bit rough going. Q3 results... We have an ongoing positive order trend with the third consecutive quarter with a book to build above one in a quite demarcated environment in all our markets. We show continuous resilience despite the market weaknesses and we have temporary profitability impacts due to the trade disputes ongoing. If you look at the orders, we can see that they're increased substantially year on year, and they're up in all end markets and all regions except Europe, with resilient sales year to date, roughly flat. The shipping these days is also a little bit disrupted at times through these trade disputes. So for us, we looked at this as a flat development. and also Q3 sales of 164. We look as a good results. We had a tough comparison with last year. We'll get back to that when we had large semi-orders out of China chip maker that we delivered. If you look at the segments briefly in our overview, we have growth of semiconductors in all regions offset by a weakened market in China. regarding sales resulting in a flat year to date, minus 1%. The broad ramp of the industry we believe is further delayed due to these disputes and negative investment developments where projects delay further on the timeline. They don't go away, but they move out further. So we believe ramp is rather second half 26 or even partially in 27. GenuVac, general vacuum is growing in 2025, with another good quarter, plus 7% year-to-date, plus 6% quarter-and-quarter. Solid QV, RSE auto results, I will talk more about that. Growth, even though the market is partially in consolidation, plus 4% year-to-date. Security and energy is in a useful cyclical position. downturn where we have government program timings mostly defining the cycles. We have, however, already received first larger orders again from the next program wave. If you look at operating results, operating margin at 14%. The key factors there are lingering temporary impact from the trade disputes. One key thing there is the capacity duplication. um i get back to that in a minute negative foreign exchange effects that's mainly the strong swiss francs versus the us dollars and tariff impact efficiency measures are in execution or around all that so regarding the Capacity duplication, what is that? As you know, in Q2, we showed how we move the production. This reconfiguration is largely concluded now, and we have adjusted to the new trade world in that sense. What we don't still have is we have capacity in the former production location that needs to be ramped down over time. If you want to look at that in a big picture, then you could say we have still too much capacity in the west as we have ramped up in a really fast pace in the east. Now it's about ramping down the capacities in the west that we do not need anymore because we supply our customers directly out of the east. Then when we look at the FX impacts, these affect part of our locations it's an effect we also working on ramping down it's basically similar measures right moving around head counts and capacity and tariffs I believe we have been able to reduce quite significantly versus the last quarter through these measures though there's some that still remain and some few ones will even stay for the foreseeable future. If I continue here, we will go into this, all these topics in more details through the presentation. Operating cash flow at the robust 27 million US dollars. And then when we look at organization, as I mentioned, the production reconfiguration is concluded. But of course, still some of this duplication needs to be managed, which we are with high priority working on. With this new setup, we avoid the substantial trade dispute impacts. This is barriers and tariffs, other factors that we are able to avoid like this. And I believe we are very well positioned now for future different scenarios. There's a little uncertainty, of course, and I believe you're positioned for all of these different scenarios. We continue to invest in leading-edge R&D with 8% of sales. I think this is a key point when we look at our orders. I'll get back to that also in a minute. When we look at CapEx, this is a little bit slower than before. I believe we have the CapEx. When we move production capacity, we typically don't need so much additional capex because we're moving tools and so on. So we're looking at about 20, 25 million US dollars for capex. When we look at the overall pictures and also tie it together, why we push forward with leading edge R&D and are really optimistic there is, We're winning for three factors, really. And that's also why we can show orders different than many others in these industries where we have really interesting R&D pipeline where we're winning new business, we're opening up new applications that weren't possible to be sensorized before. There was no measurement possible before. So that's also harsher environments with all the leading edge logic, for instance, or leading edge memory. There's clear market share gain. And there is also a couple of interesting smaller markets that we focus on that we find are equally interesting as the semi-market. Good growth, good profitability, and they actually show strong resilience in this more difficult economic time. So, three good drivers for why our orders are up, and I believe this is the time for bold moves for Indicom to really move forward. and focus on the customer. So if we dive into the different perspectives here, worldwide markets and sales, we made one change for you, a little bit increased transparency in the sense we show now four regions. I think it's quite relevant to show these four regions. That's how we internally think. That's how we structure our innovation, organization, and also production and supply chain. So we're looking now at Asia Pacific, China, Europe, and Americas. If you look at the development there regarding sales, you can see two regions are down in Q3, two regions are up. All in all, you can see a positive trend, especially in Europe and Asia Pacific. And China and America is a bit slower. There's some reflection of the U.S. trade restrictions in that. If you then jump into the different target markets, starting with semiconductor and vacuum coating. We are in a very strong position. As I just mentioned, I believe now is the time where we really expand our footprint there in the market, opening up new application, gaining market share. And the innovation pipeline is on fire. I think it's also in the slower times the time where you can, with your customers, truly innovate on the next generation of products or the one after of their products. And that's really what we see these times. When we look at the general market developments, the broad industry ramp, as I mentioned earlier, we believe is delayed through the trade tension, which constrains the growth and delay the investments. That is a timing that we cannot influence. That's the industry. Some sub-segment, though, there are, of course, already ramping, but it's too narrow, specifically the one around AI, that is HPC and HPM. Certainly very interesting. That's a few players that and there's a few others that's trying to catch up. That's where CapEx investments happen on a larger scale and where we see an acceleration, but it is still too narrow when you are the other sub markets within the semiconductor market. There is everything from being really quite hot and ramping to slowing down again. And I think also what is interesting as opposed to maybe also other cycles is it's a bit back and forth. So we see things like last year in China, we had an acceleration in chip makers investment that you then also ship. That is also why our comparison year on year on the Q3 is tough because we ship that all in Q3. Then we saw a slowdown of this chipmaker business in China, but an acceleration of the toolmaker. In the first half of this year, we shipped that too, and now we see again that has slowed down, but a bit of an uptick again in China. So there is so much, this is an example, so much going back and forth, the visibility is really quite low. So when we look at... the market outlook for semiconductor, we look at this flat to slow. And the main reason for that is actually we are trending flat to last year. And I think if we had shipped everything, we could be even a little bit ahead. But the last year's Q4 quarter was really quite huge, an absolute record quarter because we shipped so much. And also for the chip makers, that 100 million to repeat that, that will be not so easy. It's possible, but that's why we are saying flat to slow on this. All in all, really optimistic about what's happening in the partnerships with our customers where we work on the next generation of our products. A lot of new wins across the board. Quite exciting technology updates and you will hear more about that in other formats as well. If you then jump into RSC Auto target market, I think also here we expand our already strong position. This is a market that overall is not growing necessarily, at least part of it, especially the EV part of it has just passed through rock bottom and is now picking up slowly. But we clearly gain market share there with our leading edge products. I think we're at least a generation ahead there. And we're also winning in the east, which is very important. That also shows how localized we can operate, innovation and manufacturing. So here we had a growth of, as you see in the chart on the right, of 30% in 2023, but we could sustain that level and grow ever since in 2024. And also this year we show growth, with year-to-date was 4%. So I think we expanded this market. Important next to auto and EV that, again, is past the rock bottom and seems to be slowly picking up in spite of all the headwinds from policy to consumption. Two other things are also important. One is the build of data centers is something where we profit from clearly, obviously, on the semiconductor end market, but we also profit from it here because of why the – Air conditioning market is a key supporter of these data centers. It's a very key ingredient to build large data centers, and that's where we see a really strong dynamic now emerging just over the last couple quarters. And the other one is a bit of a longer-term one, the new refrigerants due to the climate policy changes that drives our new sensor growth. That's also new innovations from us that are able to detect these new refrigerants. That drives that market as well. So all in all, a really strong R&D pipeline. I think ELT is strong, Stratos is strong. There's a couple of other strong products here. What also is a factor here is specifically for the handhelds, our competition is American. We were able to relatively quickly move now in Q2 our production out of China. Everybody in manufacturing is in China. And now we're supplying globally out of Malaysia, and we see market gains there, too, because of this really fast reaction. Yes, it costs us. We've got a big thing, right? We see it in the operation income, but we also see the benefits on it already now emerging in this range. Okay, then we move on to the next target market, general vacuum. uh quite excited about that i think we show continued sales growth after 2024 was slower and remember 2023 was covered opening and shipping of all the backlogs or a bit of an outlier but now in 2025 you see continued growth and you see here today the plus seven year on the year significantly up quarter and quarter up I think this shows also the strong position that we further expand. This is a bucket of many smaller markets, maybe 20 or so, that we carefully select regarding our position, what we can contribute, the growth potential, the profitability potential, And I think now is also the time of this smaller industrial, advanced industrial markets, or also big science markets, or life science markets, which show strength, where we can further expand our position, but they also grow. One thing is missing still is the solar market, which is an interesting part of this basket of markets. We believe this is still in consolidation. There's a lot of overcapacity specifically in China. And it's very likely that the recovery really only comes end of 26 or even slips partially into 27. Nonetheless, I think there's a lot of reason for optimism, as we also here build out our strong positions across the sub-markets. The last market, security and energy, as I mentioned, we have number one products here, but this is driven by these large government programs, big ones in the US, but also across NATO and also in the East. We have been rolling out A couple of programs over the last couple of years, you see the massive growth that we've shown from 22 to 24. This year was expected to be slower, but we have already seen good order entry again. So the first pieces are coming. This is not a full new cycle. I think we are still working on the new programs, and they will come in. But it's a good sign of how dynamic this is. And, of course, with the security situation, defense budgets go up all around, specifically in Europe. Plus, specifically the new headset generation is able to go into a number of new applications, explosives, narcotics, environment testing. These are all additional sub-markets that we are adding over time. Remember here, the qualification period is really multiple years. So this all takes a lot of time. I think we show good progress, but until you truly see it in the numbers for these new markets, that will still take some time. But we have first really interesting wins. And then when we move to the expectations 2025, I think there's reason for optimism for us regarding our market position, how we expanded our order situation, and also the market outlook. Orders remain strong. They're the third consecutive quarters that they're above one, quite significantly above last year. Year-to-date across multiple dimensions. What is difficult is Still, the outlook, I described it before with the example of China, but that goes across different submarkets, different geographies. It's a back and forth. It's murky. It's changing quick. It's volatile. I think for us it's key that we're well positioned, that we expand our position, and then whatever submarket then will start to ramp, we're part of the game. And we can show that already now, I believe, and we'll continue to do so. So the uncertainties are there, but we also have prepared ourselves over Q2 in particular, but also Q3 to be positioned with our global footprint for innovation, for manufacturing, to be really close to the customer, react fast, and supply product, but also innovate together in all four regions, which I'm very optimistic about for the future, no matter what exactly the impacts can be. Efficiency measures, though, are required, right? I told you about broadly it's a ramp down in the west and a ramp up in the east, but that doesn't go entirely different. That goes a little bit in parallel, right? So that's the time where we are in, where there's inefficiencies. So when we look at the full-year guidance, we narrowed it to $660 to $680 million of sales and an operating income to 16% to 17%. I think this gap to 2020 is our benchmark. 20% is where we're going to go back to. Our business model is 20% plus and we have a path beyond that. There's three major factors if you look at the full year. One is this duplicated capacity that we are rapidly reducing one is fx which is largely swiss bank which we are also addressing addressing but it will probably not go fully away but we are addressing it with also moving and then the first third one is tariffs and tariffs we have already halved from the last And we further work on this as we optimize the stream of the goods across the Inficon world. And with that, I finish with our typical picture here. Follow us if you want to have more insight what's going on at Inficon on different dimensions. I think there's two or three interesting most recent posts that we made. One is the expansion of the clean room in Longmont. Exciting new expansion for our American customers and to supply them more closely and faster and ramp there. That's a product that we do there that ramps real quick actually as part of the new market gains that we make. Malaysia, you know about that, but you can also see that we are investing into further global service. Always stay close to the customer, especially in difficult stormy times. That's when you gain. So we expand global service and repair capacities, especially also in these times. So we continue to invest in that. And you also see leading-edge technology. Product development across the board from big science, like they are close to Chicago in Fermilab. I actually personally know this experiment quite well. It's a super exciting experiment where they challenge the standard model of physics. And then also, of course, in a more broader sector where we lead the thinking around how smart manufacturing needs to look in semiconductor fabs, where we're taking over the lead of the global semi-orgs. a special industry group that develops the future vision of that. So across the board, I think really interesting news. Well, yes, it's also been a difficult part, a lot of extra work, impacts on the bottom line, but I think the optimism is well justified. So with this, I want to close and move over to our CFO, Matthias Trendley, who will give you a few more details on the financials.