Ultra Clean Technology Stifel Technology, Internet & Media - PowerPoint PPT Presentation

Ultra Clean Technology Stifel Technology, Internet & Media Conference June 7, 2016

Safe Harbor This presentation may contain forward-looking statements and management may make additional forward- looking statements in response to your questions. These statements are made under the ''safe harbor'' provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Statements that are not historical facts, including statements concerning our beliefs, forecasts, estimates and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including risks related to: the risk that our results of operations are cyclical and may fluctuate from period to period; the risk that we rely on a small number of customers for a significant portion of our revenue; the risk that the industries in which we participate are highly competitive and other risks outlined in our public filings with the Securities and Exchange Commission, including as set forth under “Risk Factors”, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in our most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K filed with the Securities and Exchange Commission. The forward-looking statements made in this presentation relate only to events or information as of the date on which the statements are made in this presentation. Except as required by law, we undertake no obligation to update or revise publicly any forward- looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. 2 External Use

UCT Highlights Global leader in design, engineering and manufacturing of critical modules, subsystems and turnkey solutions primarily for the semiconductor capital equipment industry. • Q1’16 revenue of $112M, a quarter-over-quarter increase of 8.5% – Earnings call Q2’16 revenue guidance $123 – 128M and EPS* $0.05 – $0.08 • Continued recovery in Semiconductor Wafer Equipment spending – Industry commitment to node transitions in logic (10nm) and DRAM ( ≤ 20nm) – Increased capital intensity in deposition and etch for FinFET and 3D NAND • Building the platform for UCT’s growth – Strategic investment in capabilities to enable ramp of new business – Streamlining business systems and processes * Pro forma earnings per share, adding back amortization. 3 External Use

From Design to Prototype to Production SUPPLY CHAIN MANAGEMENT MANUFACTURING MANUFACTURING ENGINEERING  Broad expertise in multiple areas − Complete outsourced design • Gas and liquid delivery • Mechanical and electrical assemblies PROTOTYPING/ INTEGRATION & TEST • Thermal management DEVELOPMENT − Quick turn capabilities 4 External Use

From Design to Prototype to Production SUPPLY CHAIN MANAGEMENT MANUFACTURING MANUFACTURING ENGINEERING  Design for manufacturability (DFM) − Lower production costs − Reduced cycle time  Partner with customers to meet demanding new PROTOTYPING/ INTEGRATION & TEST DEVELOPMENT product requirements  Continuous improvement in operational excellence 5 External Use

From Design to Prototype to Production SUPPLY CHAIN MANAGEMENT MANUFACTURING MANUFACTURING ENGINEERING  Network of global, strategic partners  Reduce customer overhead through UCT expertise in qualifying and managing complex supplier base − Aggregated buying power PROTOTYPING/ INTEGRATION & TEST DEVELOPMENT − Improved customer delivery time 6 External Use

From Design to Prototype to Production SUPPLY CHAIN MANAGEMENT MANUFACTURING MANUFACTURING ENGINEERING  Comprehensive new product introduction process − Simplify manufacturing process − Reduce manufacturing costs − Solve production challenges PROTOTYPING/ INTEGRATION & TEST DEVELOPMENT  Vertically integrated 7 External Use

From Design to Prototype to Production SUPPLY CHAIN MANAGEMENT MANUFACTURING MANUFACTURING ENGINEERING  Sub-system through full tool integration − Electrical and mechanical assemblies − Ultra-high purity gas systems − Fluid delivery systems PROTOTYPING/ INTEGRATION & TEST DEVELOPMENT  Final test and shipment direct to end users − “Extended factory to top OEMs” 8 External Use

Semi Equipment Manufacturing Landscape UCT 5% Major Contract Manufacturers 11% OEM Integration In-Sourcing Other Contract 44% Manufacturers 6% OEM Component Suppliers 34% Source: UCT estimates. 9 External Use

Why Outsource? Provides variable cost model LOWER COST SCALABILITY Gain ability to quickly scale manufacturing Access to expertise in manufacturing OPERATIONAL FOCUS Ease of supply chain management SUPPLY CHAIN Achieve reduction of inventory, improved cash flow FINANCIAL FLEXIBILITY UCT excels at meeting quality, cost and delivery for demanding semiconductor market 10 External Use

Total WFE Market Opportunity Deposition & Etch Outpace Semi Market 2016 WFE Estimate: $33B Thermal Other Dep & Etch & Implant Metrology & 6% 5% Inspection >70% Deposition 13% 25% of UCT Semi Lithography Sales 26% Removal/Etch Total CapEx Dep & Etch 25% Spend CapEx Spend ~6% CAGR 9-10% CAGR 2013 - 2018 2013 - 2018 Source: Gartner 2015 and UCT estimates 11 External Use

Growing Suite of Critical Process Capabilities Chemical Delivery Complete Manufactured Components Sub-Systems Assemblies Machining Machining Machining Machining Sheet Metal Sheet Metal GAS Frames Frames Gas Metals Metals Forming Forming Plastics Plastics Assembly Assembly Integration Integration & Test & Test Prototype Prototype Heaters Heaters 3D Printing 3D Printing Liquid Liquid Machining Machining 12 External Use

Semi Industry Consolidation TOP 10 TOP 5 CHIP COMPANIES WFE COMPANIES 54% 63% 63% 68% 2010 2015 2010 2015 Source: Company Financials, SIA, Gartner 2015 and UCT estimates 13 External Use

Supply Chain Consolidation Opportunity TOP 10 SUPPLIERS to WFE 35% 30% 2010 2015 • Large number of small, highly specialized suppliers • Management of suppliers growing unwieldy given tech requirements • Sustainability of some suppliers • Short product cycles driving quality and delivery cost challenges Source: Company financials, UCT estimates 14 External Use

UCT Business Model GROSS MARGIN 15% - 18% KEY DIFFERENTIATORS OPERATING MARGIN 8% - 10% • Higher value capabilities • Improved operational efficiencies • Low capital requirements Targeted OPERATING PROFIT DRIVERS • Revenue growth • Low operating expenses • Strategic acquisitions 15 External Use

Select Financial Data (in $ millions) Q2'15 Q3'15* Q4’15 Q1’16 Sales $117.5 $122.8 $103.4 $112.2 Gross Profit $18.8 $18.9 $13.3 $14.6 Gross Profit % 16.0% 15.4% 12.9% 13.0% Operating Income/(Loss) $4.8 $5.1 ($0.5) $0.9 Operating Income/(Loss) % 4.1% 4.1% (0.5%) 0.8% Cash $76.6 $59.8 $50.1 $45.5 Inventory $64.6 $75.6 $72.7 $82.0 Accounts Receivable $57.5 $57.5 $59.1 $66.7 Pro forma financials adding back amortization. * Note: Q3'15 represents the first (partial) quarter of combined operations between UCT and Miconex. All prior quarters represent UCT operating results only 16 External Use

Compelling UCT Opportunity • Poised to outperform growth of Semi WFE market • Targeting fastest growing market segments • Delivering what customers need (OTD, quality, cost) • Industry trends reinforce leading position as potential supply chain consolidator • Becoming partner to key customers Winning Strong Gross Improving Solid Cash Strategy Margins Profitability Generation 17 External Use

Thank You Ultra Clean Technology Stifel Technology, Internet & Media Conference June 7, 2016