printed electronics & thinfilm: en-route the mass commercialization

Imagine Memory Everywhere™

Thin Film Electronics ASA (“Thinfilm”)

Printed Electronics & Thinfilm: En-route to Mass Commercialization Presentation at the Annual General Meeting

10th May 2012


Agenda

Printed Electronics Industry Trends

Thinfilm’s Position & Roadmap

2


Industryinvestment &participation



Continued strong momentum in the PE industry, observed by three key trends;

Source: IDTechEx; SEMI Emerging Markets; Yole Développement; Press clippings


Technical &commercialprogress

Market holdspotential

1

2

3

►Number of participants growing by 15% per year

►Positioning by large strategic/industrial companies

►New national PE initiatives and government funds

2,2503,000

2009 2011

Industry participants2009-2011

+15%

44

2

2011 2021

Market forecast 2011-2021; $ billions ►Today’s market lead by OLED display/modules (~50%

of market), conductor ink (~20%) and OPV (~15%)

►Memory, logic and sensors among the largest- and fastest growing segments towards 2015 and beyond

►Rapid technical progress across all areas

►PE industry moving from lab to fab

►First real commercialization wave underway

Companies offeringcommercial-ready products

EXAMPLES

3


Similar trends also observed in Thinfilm’s ecosystem of partners

► Raised ~$25M in series C funding (April 2012)► World-record organic solar cell performance (Feb 2012)► Expanded presence, doubled number of employees (2011)

► Share price up ~34% last year (April 2011- April 2012)► Significant investments in R&D and lab equipment

► Set to double work force during 2012 ► Prototypes and product samples made available

► Commercializing transparent conductive films ► Continued strong support from owner (Kurz Group)

► Technical progress in developing other sensor applications, including force/strain-, optical sensors and capacitive sensing

► Successful launch of printed display technology for use in books (April 2012)

► Continues momentum, new partnerships► Development of mass produced printed temperature sensors

4

Thinfilm uniquely positioned for success;

► Critical enabling technology and industry leadership

► Strong ecosystem of partners

► Industry momentum


Agenda

Printed Electronics Industry Trends

Thinfilm’s Position & Roadmap

5


Summary of achievements in 2011 andopportunities in Thinfilm’s three focus areas

6

Commercializingstand-alone memory

1

► Launch of Oba game, Inventables

► Deliveries to leading toy companies

► Dedicated factory for production (Inktec)

► First public application featuring Thinfilm memory

► World’s first printed passive array memory

Thinfilm revenue scenario2011-2020; $ millions

► Successful prototype of printed CMOS memory

► FlexTech and IDTechEx Awards, industry leadership

► Initiated development of the first integrated system prototype

► Significant interests from prospective customers

► Technology agreements with component and material suppliers

► Significant interest from various strategic and commercial parties, several ongoing discussions

Enabling integrated systems and smart tags

Building an ecosystem of partners and alliances

2

32020

1,590

2016

310

2013

3.9

2011A

0.3


First public application featuring Thinfilmmemory (at Exploratorium, March 2012)

1

• Interactive event • More than 1000

memory cards used• Exceptional

participation

► Demonstrates the unique “touch and feel” characteristics of memory cards (exceptional participation among ~1300 visitors)

► Demonstrates ease of customization for similar applications and concepts

► Demonstrates robustness of Thinfilm’stechnology (zero card failures at the event)

Commercializing stand-alone memory


8

Thinfilm is working focused towards commercialization in toys & games

1

► Lowest system cost

► Unique and attractive “touch & feel” characteristics

► Ease of personalization

Thinfilm value proposition

ASIC ($0.4-0.551)

0 5 10 15 20

0.6

0.4

0.2

0.0

System cost per memory, $

# memories per system

Thinfilmsweet spot

Memory (~$0.05)

+

Prototype & TDK customers

Company

1 Price depending on bit count of memory (and volumes)

Handful of world’s leading toys & games companies are evaluating concepts with Thinfilm memory

Status and outlook

► Very positive feedback received

► Timeline and possible hurdles for receiving large quantity orders:

• Development cycle typically 12-16 months

• Thinfilm memory a product component

• Vigorous and comprehensive “toy playing tests” (card insertion, scratch, abrasion etc.)


Size Concept

A Music game$3-5bn

B HH card game$1-2bn

C Board games$1-2bn

D Figurines$3-5bn

E Monetizing Online Game

Inventor/Game Dev.


9

Thinfilm Passive Array MemoryTM

provides additional market opportunities 1

Thinfilm Passive Array MemoryTM

16-bit PA design

► Scalable printed memory (up to 100+ bits)

► More compact design and lower costs

► Reduced number of contact points, lower cost of integration

► Enabling component in printed integrated systems and smart tags for the “Internet of Things” (IoT)

16-bit PA printed

► Suitable for a range of additional applications, including use in secure documents, ticketing and stored value cards

► Significant interest received from various industries and parties

► Engineering orders received, demonstrating commercial market opportunities

“Delivery of engineering quantities of Passive Array Memory to customer Q2 2012”6 March, 2012

Thinfilm Receives First Order for Scalable Array Printed Memory

“Passive Array Memory will further increase the amount of parts information that can be stored in a very thin profile”12 April, 2012

Thinfilm Receives Contract for Parts Identification using Printed Memory

Market opportunities



The “building blocks” of printed integrated systems Example of tag types (integrated systems)

Sensor tag(temperature)

Dynamic price display

RFID tag(contactless rewritable tag)

Battery

Display

• Co-development agreement with PST Sensors

Antenna

• Thinfilm proprietary

Logic

• Co-development and exclusive license

Memory

Sensor

• Licensed leading low-cost display

• Secured privileged access to custom battery

• Internal development and numerous external options

10

2Enabling integrated systems and smart tags


Combine components to increase value and progressively unlock new markets

Application

2-5

Monitoring of perishable goods

Personal health care

5-10

1-2

Interactive packaging

~0.5

Dynamic price display

Market size ($ bn)

NFC & "Internet of Things"

10+

Personal health care

Logistics (RFID)

2-5

Anti-theft/ brand protection

2

~0.5+

System


Commercial break-through expected around 2013; ~$1.5bn in revenues by 2020Revenue scenario, 2011-2020; USD millions

Other (both contactless-and closed systems)

Interactive packaging (FMCG/retail)

Monitoring of perishable goods/drugs (temperature sensor)

Dynamic price displays(retail)

Ticketing (transportation)

RFID (retail/logistics)

NFC & “Internet of things” (smart tags)

2020

~1500

2011A

0.3

2016

~300

2013

3

Contactless tags/systems

Closed systems

Key applications:

# tags sold(millions)

~0 40 5,000 22,000

Applications Market estimates (global) Thinfilm mkt. share

• ~$12bn in 2019 (source: IDTechEx: Printed/chipless tags)

• ~8% (2020)

• ~$500 in 2010, ~$2.5bn in 2020 (source: ODIN, VDC Research)

• ~5% (2020)

• LU tickets issued: ~9bn in 2009 (source: Innovision R&T)

• ~7% volume share (2020)1

1 Assuming no growth in number of LU tickets issued worldwide from 2009 to 20202 Time-Temperature Indicators (used in transportation/packaging, i.e., excluding other industries, e.g., automotive, HVAC/refrigeration etc.)

• TTI market2: ~$1.4bn in 2010, ~$3.2bn in 2020 (source: Frost & Sullivan, Freedonia, BCC+)

• ~4% (2020)

• Other applications/products: 20-bit memory, diaper humidity sensor, anti-theft , calibration sensors etc.

• 1-9% (2020)

• ~$5bn in 2020 (Thinfilmestimates)

• ~2% (2020)

• ~$10bn in 2020 (Thinfilmestimates)

• ~3% (2020)

• Change in product mix• Increased price as more

functionality is added


1000250.40.080

400

3,000

6,000

Volume Units sold, 2010; millions

Price$ per unit, 2010

0

5

Source: Frost & Sullivan; BCC Research; Freedonia; Sensitech; Omega Engineering; Honeywell; ATI; Vitsab International; 2DI; ABB

ILLUSTRATIVE

“Labels”

• Price: $0.005-0.08• Volume: 3-6bn

“Time labels”

• Price: $0.1-0.4• Volume: 0.5-1bn

“Alarm tags”

• Price: $15-25• Volume: ~15mn

“Wireless & Integrated devices”

• Price: $250-1000• Volume: ~1mn

Share of market

10% 5% 25% 60%

Revenue potential driven by cost/functionality

($140mn) ($0.4bn) ($0.9bn)($70mn)

Example: Monitoring of perishable goods/drugs (Temperature Sensor/TTI market)

Total market of ~$1.4bn

(2010) Thinfilm TTI market size projections

Product/tagfunctionality

2013 2016 2020

Cost/tag

Addressablemarket, $bn

E.g., max/ min temp.(counter)

E.g., time-temp. exposure

E.g., wireless alarm tags

~$0.30 ~$0.20 ~$0.10

0.1 0.4 1.2


Printed smart tags – Why now?The “Internet of Things”: a Megatrend

“….there has been an acceleration in the number and types of things that are being connected and in the technologies for identifying, sensing and communicating. These technologies are reaching critical mass and an economic tipping point over the next few years” October, 2011

Identifies Top 10 Strategic Technologies

“More objects are becoming embedded with sensors and gaining the ability to communicate. The resulting information networks promise to create new business models, improve business processes, and reduce costs and risks” McKinsey Quarterly, 2010

The Internet of Things

“The evolution of embedded systems from fixed function and disconnected systems to intelligent systems continues to gain momentum and puts intelligent systems on track to bring the Internet of Things to reality” September, 2011

Intelligent Systems: The Next Big Opportunity

2010

0.9

1.1

2011 2015

+19%2.0

20142013

1.8

2012

1.5

1.3

CAGR, 2011-2015

Market size projections1

Intelligent system & Internet of Things, USD trillions

1 Based on numbers from IDC (Intelligent Systems) , September 2011 14


Printed smart tags – Why Thinfilm?

“…. Norwegian company Thinfilm has been making headlines for its unique technology…once Thinfilm’s tags are integrated with sensing technology, food can let us know when its spoiled, based on temperature and ammonia levels..”December 14, 2011

Thinfilm CEO Wants Your Stuff To Talk To You

“…. Thinfilm offers a cheap way to give almost anything a memory….working towards a world where virtually every item that we use is tagged with memory and sensors, harvesting information locally that can then be gathered at leisure” December 15 , 2011

Even Bananas Could Have Memory

“Thinfilm has joined forces with a number of partners to develop a low-cost printed electronic sensor platform that could be used to monitor the temperature of perishable goods such as food and pharmaceuticals”January 24 , 2012

Plastic memory firm signs partners for printed systems

“The smart tag, an electronics device with basic computing components printed on a strip of plastic, features Thinfilm's memory with printable transistors from research company PARC, a sensor, a battery, and display”January 24 , 2012

Smart tag lets you print electronics on plastic

October 2011:

Successful prototype of first scalable printed CMOS memoryDemonstrated that addressable memory can be combined with sensors, displays and antennas

November 2011:

Organic semiconductor inks developed for high volume printingHigh quality semiconductor inks available. Partner with Polyera to bring printed CMOS memory to market

January 2012:

Established partnerships for display, sensor and battery technologySecured remaining “building blocks” for enabling smart tags (with Acreo, PST Sensors and Imprint Energy)

11

22

33


Q & A