EX-99.2 3 exh_992.htm EXHIBIT 99.2

EXHIBIT 99.2

II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 February 2020 INVESTOR PRESENTATION

Page 2 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 This communication contains “forward - looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward - looking statements often address expected future business and financial performance and financial condition, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” “will,” “would,” “target,” similar expressi ons , and variations or negatives of these words. Forward - looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward - looking statements. Important factors that may cause such a difference include: (( i ) the failure of any one or more of the assumptions stated above to prove to be correct; (ii) the risks relating to forward - looking statements and other “Risk Factors” discussed in the Company’s Annual Report on Form 10 - K for the fiscal year ended June 30, 2019; (iii) the purchasing patterns of customers and end - users; (iv) the timely release of new products, and acceptance of such new products by the market; (v) the introduction of new products by competitors and other competitive responses; (vi) the Company’s ability to assimilate recently acquired businesses, and risks, costs and uncertainties associated with such acquisitions; and/or (vii) t he Company’s ability to devise and execute strategies to respond to market conditions. The Company disclaims any obligation to update information contained in these forward - looking statements whether as a result of new information, future events or developments, or otherwise. Safe Harbor Statement

Page 3 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 Core Competency ENGINEERED MATERIALS Refers to groups II and VI of the Periodic Table of Elements “ TWO SIX ” 18 Countries 69 Worldwide Locations 24,000 Worldwide employees 2.6B Pro Forma Revenue Regions 43% 23% 6% FY2019 Revenue 11% 17% Segments 28% 72% FY2019 Revenue FY2019 Revenue 72% 13% 6% Markets Aerospace & Defense Semi.Cap. Equip Life Sciences All other 4% Overview LTM 06/30/2019 for II - VI and LTM 07/28/2019 for Finisar.

Page 4 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 3D Sensing Core Markets Growth Markets SIC for Wireless SIC for EV Optical Communications Industrial Lasers Aerospace & Defense EUV Lithography Our Core & Growth Markets

Page 5 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 *Sampling of representative customers based on approvals for public release Thousands of Customers Across Diverse Markets

Page 6 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 $333 $487 $516 $551 $683 $742 $827 $972 $1,050 $1,362 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 NASDAQ S&P 500 10 Years of continuous revenue growth 4 Transformative Acquisitions Stock charts represent relative growth in value since 1987 Optical Network & China Market InP Technology Platform Vertical Integration & Scale GaAs Technology Platform 2010 2013 2016 2019 Revenue Growth & Transformative Acquisitions 5G

Page 7 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 Semiconductor Lasers Oclaro Semiconductor Laser Optical Amplifiers Oclaro Optical Amplifier Advanced Coatings Oclaro Optical Coatings Aerospace & Defense Optical Systems LightWorks Optics Precision Ceramics M Cubed Technologies Optical Channel Monitors Aegis Lightwave Conformal Patterning Max Levy Autograph InP Platform Finisar High Energy Lasers Redstone Aerospace Optonicus Wavelength Selective Switch CoAdna Compound Semiconductor Wafer Fab Kaiam Laser Limited(U.K. Fab) Faraday Rotator Integrated Photonics Direct Diode Lasers Direct Photonics GaAs & GaN - SiC Platform Anadigics Epitaxial Wafers Epiworks Micro - optics Photop Technologies Laser Processing Heads Highyag Selenium Refinery Pacific Rare Metals Thermo - electrics Marlow Industries Ultraviolet Filters Laser Power Corp Silicon Carbide Substrates Litton SIC Group ZnSe Platform Laser Power Corp Micro - optics Lighting Optical Micro - optics Virgo Optics 1995 - 2010 2011 - 2015 2016 - 2019 20+ Years of Tremendous Value Creation by Integration of Acquisitions

Page 8 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 Oclaro Semiconductor Laser 1 Business Case Study ▪ Target had a high unit cost structure ▪ With vertical integration and wide applicability in optical and industrial markets, II - VI drove margin expansion over subsequent years II - VI Laser Enterprise Revenue and Operating Margin 1. Oclaro’s semiconductor laser business was acquired in FY2014. Transaction Overview Operational Excellence FY14 Then (@ Acquisition) FY14 FY19 60% (45%) Revenue Op. Margin Proven Integration Playbook Focused on Operational Improvements and Investing for Growth

Page 9 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 $- $2 $4 $6 $8 $10 $12 $14 $16 $18 $20 2018 2019 2020 2021 2022 Datacom TRx Telecom TRx ROADM 3DS & LiDAR RF Electronics Power Electronics Right Technology + Right Team + Right Time Inflection Point CAGR 16% CAGR 20% TAM ($B) Combined broad base of talent, technology and manufacturing enhances our ability to hit market windows today Window of Opportunity 1 Note: Market size forecast from Lightcounting, Ovum and Yole. Disruptive Megatrends Proliferation of Cloud Services Electric & Autonomous Vehicles Accelerated deployments in Mobile & 5G Communications 3D Sensing Increased Data and Video Consumption Acquisition of Finisar Strategic Window of Opportunity Now

Page 10 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 Power Electronics For Green Energy RF Electronics in Wireless Optical Communications 3D Sensing & LiDAR $12.1B 2022 Market For 3D sensing in consumer electronics & LiDAR in automotive For terrestrial, submarine & wireless optical infrastructure and datacenters 60% 2018 - 22 CAGR $1.1B For 4G remote radio heads, 5G beam forming antennas & RF electronics 26% For electric vehicles (EV/HEV), smart grid power switching, solar and wind energy $2.9B 13% GaAs | InP | Si Photonics GaAs | InP SiC Source: 3D Sensing & LiDAR, Wireless RF and Power Electronics for Green Energy from Yole, Optical Communications from Lightco unt ing and Ovum. $1.2B 27% GaAs | GaN / SiC | Diamond Addressing Multiple Strong and Growing Markets

Page 11 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 GaAs InP WSS Optics Datacom Transceiver Technology 3D Sensing Telecom Transceiver Technology ROADMs Integrated Circuits LCoS Diffraction Gratings Transimpedance Amplifier Laser Driver Silicon Photonics PIC + EIC Clock & Data Recovery Coherent Tx+Rx Assemblies Coherent Tunable Laser Tunable Laser + InP Modulator I - Temp Tunable DBR Laser + MZ Mod High - Speed InP DML High - Speed GaAs VCSEL 2D VCSEL Array Finisar Brings Significant Next - Generation Technologies For Communications, 3D Sensing, and LiDAR Enabling New Market Growth

Page 12 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 #1 in Optical Communications Telecom Datacom Long Haul, Metro, and Datacenter Interconnects A highly complementary and complete portfolio of leading - edge products Subsea ROADMs Transmission

Page 13 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 5G RADIO ACCESS 5G OPTICAL ACCESS 2022 TAM: $2.4B 2018 - 22 CAGR: 13% TAM: $1.4B CAGR: 124% TAM: $1.1B CAGR: 63% Source : LightCounting Note : TAM is all inclusive (not exclusively 5G driven) Sources: LightCounting & II - VI Estimates Sources : Yole , JP Morgan & II - VI Estimates ( GaN / SiC RF includes 4G & 5G) Backbone Network Front - & Backhaul Network Base Stations Handsets Photonic Solutions Segment Compound Semiconductors Segments GaAs RF GaN / SiC RF Line Cards Amplifiers OCM/OTDR LPC WSS Subsystems Bidi DWDM TRx 100G BH TRx 25G FH TRx HPC WSS Coherent TRx DWDM Filters II - VI Finisar Growth Opportunities in 5G Mobile Infrastructure

Page 14 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 ▪ II - VI’s GaAs & SiC on 6” platform + Finisar’s microelectronics design expertise = Access to larger & growing markets ▪ Collaboration with SEDI for GaN/SiC RF electronics ▪ For wireless: efficient, high power RF amplification with GaN/SiC HEMT ▪ Thin - film diamond on silicon for next generation high speed wireless electronics Remote Radio Head Beam - forming Antenna For 4G & 5G Wireless Antennas For RF Devices in Wireless Handsets SiC Substrates GaAs Epiwafers GaAs pHEMT For RF Applications in Wireless 5G WIRELESS 4G WIRELESS GaN / SiC for RF Electronics Market CAGR (‘18 - ’22): 26% Source: Yole RF Electronics for Wireless

Page 15 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 VCSEL Arrays For 3D Sensing & LiDAR CAGR (’18 - 22): +60% Source: Yole ▪ II - VI’s GaAs Platform + Finisar’s InP Platform = Enhanced competency in 3D Sensing and LiDAR ▪ Optimization of R&D, Capital and Asset Utilization = Faster Time to Market ▪ Vertically integrated 6 inch GaAs compound semiconductor platform, one of the largest in the world = RF Devices and advanced optoelectronic device integration Tablets Auto LiDAR Video Game Consoles Security / Biometrics VR / AR eCommerce GaAs InP Most Compelling Platform for 3D Sensing & LiDAR GaAs VCSEL ARRAYS 940 GaAs EDGE - EMITTING LASERS 1550 InP EDGE - EMITTING LASERS

Page 16 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 ▪ II - VI’s SiC on 6” platform + Finisar’s microelectronics design expertise = Access to larger & growing markets ▪ High efficiency voltage and power conversion = SiC MOSFETs for Green Energy SiC for High Power Electronics Market CAGR (’18 - ’22): 27% Source: Yole A world leading supplier of SiC substrates Applications ▪ Electric cars (EV/HEV) ▪ Solar & Wind Energy ▪ Smart Grid Power Switching Electric Charger / HV Battery Bi - Directional Converter/ Inverter/ Electric Motor DC - DC Converter Power Electronics for Green Energy

Page 17 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 High Power Semiconductor Lasers & Laser Optics ▪ A full suite of components for multiple laser modalities ▪ Strong CO 2 deployed base in active use and strong secondary market ▪ Industrial laser components: 25 - 35% of worldwide revenue Fiber Lasers Market CAGR (‘17 - ‘22): +8% Direct Diode Market CAGR (‘17 - ‘22): +7% Source: Strategies Unlimited Laser Components, Processing Heads, Beam Delivery Optics / Components FIBER LASER OPTICS CO2 LASER OPTICS LASER BARS CUTTING HEADS DIRECT DIODE LASER ENGINE Industrial Laser Materials Processing

Page 18 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 World leader in large sapphire panel output 24,000 sf dedicated facility Aerospace & Defense ▪ Diverse Aerospace Applications ▪ 4 Strategic Areas in Defense • Intelligence surveillance & reconnaissance (ISR) • High energy laser systems • Missiles and ordnance • EMI & survivability ▪ Differentiated core capabilities & products • Materials engineered in - house • Complex electro - optic sub - assemblies • Emerging strategic platforms Phased array laser optics for space nanocraft propulsion and communication

Page 19 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 EUV Lithography System ▪ EUV Lithography already started for 7 nm node production ▪ Multiple II - VI products used in each EUV system, ~1 - 2% of total value ▪ Products leverage II - VI materials: ZnSe , CdTe , CVD Diamond and RBSiC REAR MIRRORS OUTPUT COUPLERS MODULATOR CVD DIAMOND REACTION BONE DED SIC EUV Lithography Systems Market CAGR (‘16 - ’22): 9% Source: Allied Market Research Structural Ceramic Subsystems EUV Source System: Focusing Optics Power Amplifier CO2 System: Seed Laser EUV Lithography

II - VI Financial Summary

Page 21 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 Cost of Goods Sold ▪ Supply chain management - Procurement ▪ Infeed - Internal supply of enabling materials and components ~$85 million Sales & Marketing ▪ Savings from scale General & Administration ▪ Consolidation of overlapping corporate costs ▪ Optimization of operating model Annual Estimated Synergies Achieved Within 36 months Total Research & Development ▪ More efficient R&D with scale ▪ Complementary engineering and design teams ~$65 million ~$150 million Significant Value Creation Potential from Synergies

Page 22 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 End Market Distribution of Full Year FY19 Revenue Reported Segments FY19 Revenue FYY19 Op Margin – GAAP / Non - GAAP FY19/FY18 Revenue Growth Industrial (Automotive) Fiber O ptic & Wireless Comm. Military Semi Cap Life Science, Consumer, Other Photonic Solutions $639M 13% / 17% 31% 9% 82% 0% 3% 6% Compound Semiconductors $723M 11% / 14% 8% 42% (3%) 13% 21% 13% 11% II - VI Consolidated $1,362M 11% / 15% 18% 27% (2%) 45% 11% 8% 9% II - VI Segment Revenue by End Markets for Full Year FY19

Page 23 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 End Market Distribution of Q2FY20 Revenue Reported Segments Q2FY19 Revenue Q2FY20 Revenue Q2FY20 Op Margin – GAAP / Non - GAAP Q2FY20/ Q2FY19 Revenue Growth Pro Forma* Revenue Growth 1HFY20/ 1HFY19 Industrial (Automotive) Fiber O ptic & Wireless Comm. Military Semi Cap Life Science, Consumer, Other Photonic Solutions $160M $460M (13%) / 12% 188% 3% 94% 0% 0% 3% Compound Semiconductors $183M $206M (4%) / 5% 13% 30% (2%) 15% 22% 12% 21% II - VI Consolidated $343M $666M (12%) / 10% 94% - 2% 11% (0%) 70% 7% 4% 7% II - VI Segment Revenue by End Markets for Q2FY20 * Pro Forma on page 11 of Form 10Q filed on February 10, 2020

Page 25 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 Summary of Q1FY20 Main Points Key Statistics for Modeling FY20 on II - VI Consolidated Item Preliminary Amount Estimated for FY20 Comments Depreciation Amortization Inventory Step Up $174M of Depreciation $107M of Amortization $88M of Inventory Step Up Includes Preliminary Purchase Accounting Amounts of Acquisition: • $1,305M: Assigned to tangible net assets • $750M: PP&E ($125M step up) • $440M: Inventory (step up, $88M, $7M Q1, $81M Q2) • $115M: All Other • $774M: Assigned to goodwill • $753M: Assigned to amortizing intangibles, weighted avg. 7 year life • $ 76M: Assigned to non - amortizing intangibles Synergies $150M run rate synergies by Year 3 Targets: Year 1: $35M, Year 2: +$50M, Year 3: +$65M Cap Ex $150 – 200M Stock Compensation $65M Interest $85 - 90M Tax Rate 9 - 12% Shares Outstanding 94M

Page 26 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 Cash and Equivalents Cash Flow from Operations Long - Term Debt (Including current portion) FY19 FY17 FY18 Shareholder’s Equity $205M $271M $247M $178M $118M $161M $467M $342M $439M $1,954M $900M $1,024M Cash and Liquidity Q2FY20 $377M $81.9M $2,297M $2,066M Typical industry EPS adjustments are detailed at the end of this presentation. II - VI Balance Sheet

Appendix

Page 28 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 II - VI Historical GAAP EPS and Adjusted EPS Equivalent To calculate EPS comparable to some peers, below are the values of typical adjustments used by other companies II - VI Consolidated Summary of Typical Industry Non - GAAP Adjustments Q2 FY18 Q3 FY18 Q4 FY18 Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19 Q1 FY20 Q2 FY20 Special Items, net of tax (1) - - - - - - - 48.1 2.2 Inventory Fair Value Adjustment 80.6 Amortization 3.8 3.6 3.6 3.7 4.1 4.2 4.6 4.2 33.6 Share Based Comp 5.3 3.6 4.4 5.3 5.0 7.9 6.8 5.4 19.3 M&A Related Expenses - - - 1.9 8.6 4.1 4.8 5.6 8.0 Total Adjustments 9.1 7.2 8.0 10.9 17.7 16.2 16.2 63.3 143.7 Tax - (0.1) (0.2) - (0.1) (0.2) (0.4) (0.2) (12.3) Impact of the “Tax Cuts and Jobs Act” and Company Actions 15.8 (6.5) (1.3) - - - - - PAT 24.9 0.6 6.5 10.9 17.7 16.0 15.8 61.1 131.4 Average Outstanding Shares - Diluted 65.0 72.4 (2) 65.1 66.2 65.7 65.7 65.7 65.5 93.0 EPS Impact of Typical Industry Non - GAAP Adj. 0.38 0.01 0.10 0.16 0.27 0.24 0.24 0.97 1.41 (1) Special Items are defined within Table 2 of the Company’s Q1 FY2020 Earnings Release. Includes severance, restructuring a nd related for Q2 FY20. (2) Average Shares Outstanding – Diluted for the Three Months Ended March 31, 2018 was calculated under the If - Converted method to account for the Company’s convertible debt. Reference Table 7: Earnings Per Share Reconciliation from the Q3 FY2018 Earnings Release.

Page 29 II - VI Incorporated CONFIDENTIAL - Export Control Classification EAR99 II - VI Segment Reconciliation: Operating Income to Adjusted Operating Income