AGM 2019

Feb 21, 2019

Slides

We're living in a world that continues to reinvent itself with visionary ideas and innovative concepts as well as important answers How are we going to communicate and how do we protect our data? Micro electronics comes up with solutions. It comes up with a connection between the digital and the real world. Semiconductors from Infineon see to it that technology can perform better, consumes less and is available to all. Innovative prowess, partnership, performance, we make your life easier safer and greener for a future that's worth living in Finian, part of your life, part of tomorrow. Mada. Ladies and gentlemen, my dear shareholders. I hereby open the annual general meeting of Infineon Technologies AG and welcome you as owners of our company the representatives of the press and our guests. The Board of Management and the Supervisory Board are fully present here today. Mr. Holton Reid has been excused from attending He is a member of the Supervisory Board. According to our articles of incorporation, I am chairing this meeting today as Chairman of the Supervisory Board, as announced in the notice, our shareholders this year will be afforded the opportunity once again to follow the entire AGM via a live web stream. Furthermore, the first part of the AGM including the report on the work of the Supervisory Board and the speeches of Doctor. Plus and Mr. Azam will be available to everyone via a live web feed, there will not be written minutes However, your questions and motions will be noted in order to ensure that they're processed properly. I would like to point out that it is from now on impermissible to make image and audio recordings from now on This also applies to recordings of the transmission via the web stream. At the beginning of the AGM, we would like to remember those of our pensioners of our company who passed away last year. I would like to especially recall Wolfgang Maier Hooper who passed away on the 1st December last year, Mr. Maya Huber was the Chairman and then the honorary chairman of our supervisory board For a great many years, we lost an outstanding entrepreneur in Mr. Maya Huber. He was a friend of the company who through his action, his knowledge, his experience, and his decisiveness, really placed his stamp on the fortunes of this company, leading it to the blossoming enterprise that it is today Mr. Maya Hoefer is deserving of our extreme gratitude. We will not forget him To honor those who passed away, you have stood up from your seats, and I would like to thank you for that. I would now like to ask Mr. Von Aitzchett, the legal counsel of the company, to acquaint you with some of the formalities and organizational issues with respect to the procedure of this year's AGM. Thank you very much Doctor. Zena, today's AGM was convened through the notice on 11th January 2019 in the German federal Gazette The notarial minutes, as in the previous years, will be taken by Doctor. Gute. Anyone who would like to get in touch with the Notary public during the AGM should go to one of the speakers' desks. From your perspective, the speaker's desk is to the right of the stage. The attendees list can shortly be viewed at the entrance to this room. With the exception of the banks and shareholder associations, every shareholder and shareholder representative has received an admission ticket and a voting card, either in classical paper form or as a digital admission ticket or voting tickets on their cell phone or tablet, please keep this card up until the end of the AGM. You will need the admission ticket and voting card For example, if you wish to speak during the AGM, and in order to do so, you have to register with your card at the speaker's desk. If you'd like to file motions, you should do this as early as possible and definitely before the end of the general debate. Have announced electoral proposals or submitted questions in writing, it is necessary that you repeat them today verbally. In order to do so, again, please register with the speakers desk beforehand, the voting procedure on the items on the agenda will be explained to you by Doctor. Sooner after the end of the general debate. And so doing, as last year, we will use tablets instead of the customary voting card blocks that were used until the 2017 AGM. You can exercise your voting right in person, or if you would like to wish the meeting early, via a proxy. In order to authorize a voting proxy, you can use your paper admission ticket and voting card and submit it at the exit. If you have a digital card, you can use a tablet or a specific form for this purpose, which is also located at the exit If you would like a form to do this, which is available at the speaker's desk and at the exit. Instructions and authorizations can be issued up until the end of the general debate via the Internet, and they can also be amended or revoked. The same applies to the submission amendment or replication of absentee ballots. Here on-site, authorizations and instructions as well as absentee ballots can be cast and submitted and the entry and exit control and they can also be amended or revoked at these points. I would also like to point out the following: should you have more for example, because you have more than 1 share deposit account at various banks please see to it that all of the corresponding shareholdings have been registered at the entrance Should you not have done that yet, you can do this now at the speaker's desk or at the entry control point. Now I have bored you enough with legal formalities. So I shall pass the floor back to you, Mr. Sune. Well, that rounds up the formal issues and organizational topics With respect to the procedure of the AGM, I now call all of the items on today's agenda. This brings me to item 1 on the agenda. Submission of the approved separate financial statements of Infineon Technologies AG and the approved consolidated financial statements both as of 30 September 2018, the combined management report for Infineon Technologies AG and the Infineon Group, including the explanatory report on the disclosures pursuant to Section 1 and Section 315A paragraph 1 of the German commercial code. The report of the Supervisory Board for the 2018 fiscal year and the management board's proposal for the allocation of unappropriated profit. The aforementioned documents have already been published on the Infineon website along with all of the associated documents, they will also be made available at the speaker's desk and at the information counter, the supervisory board, has approved the separate financial statements and consolidated financial statements prepared by the management board and the separate financial statements have therefore been adopted in accordance with the law, namely with Section 172 First sentence of the German Stock Corporation Act, A resolution of the annual general meeting pertaining to this particular item on the agenda is therefore not required. This brings me to the We have reported on the work of the Supervisory Board, in the Supervisory Board in the annual report, However, I would like to highlight the most important points in more detail. First of all, Infineon remains on its course for success and growth. Therefore, Infineon will invest We'll build a new 300 millimeter factory in Villa Austria for semiconductors and invest approximately 1,000,000,000 over a period of 6 years. What is of no lesser importance is that the management board has adjusted the planning of the company in respect of revenue, the segment result margin and the CapEx ratio and brought it in line with stronger long term growth. The supervisory board has approved both of these decisions of the management board following extensive debates. After all, global developments such as climate change, demographic change and mounting digitization, will continue to drive the growth of Indian Finian forward in the coming years. Electric cars interconnected battery powered devices, computing centers and power generation from renewable sources will need efficient and reliable power semiconductors. In its markets, Infineon has establish an outstanding position, thanks to leading technologies and intelligent manufacturing strategies. The opportunities arising from this in the future for continued sustainable growth will be seized by Infineon. On top of that, the supervisory board concerned itself with possible opportunities in the field of M And A. One issue that came up for decision was the disinvestment namely the sale of the RF power product line to the U. S. Semiconductor company Cree for approximately $345,000,000. After debating the planned transaction extensively, the Supervisory Board endorsed the assessment of the management board that the divestment of the RF power business to CRE made sense from an entrepreneurial point of view. Also, with respect to the affected employees, because it offered them good prospects the supervisory board, therefore, approve the transaction. The supervisory board still believes it's extremely important to concern itself with the strategy the company. As in the past year, therefore, one meeting of the Supervisory Board was dedicated to this in the reporting year. We've debated this with the management board intensively. We discussed the strategic alignment, starting from the expansion of competencies in the core markets via the widening of the product portfolio running up all the way to the optimization of the manufacturing strategy and the question as to the extent to which Infineon should become more active in the field of developing software for use of hardware components manufactured by the company. The Supervisory Board endorses the strategic alignment pursued by the Management Board. This exchange with the management board is of elementary importance to the supervisory board. Therefore, we welcome that the management board conducted these discussions in an extremely open and trusting environment. Ladies and gentlemen, this brings me to the earnings of the past fiscal year and I can give you some pleasant news. As in the past years, it is still important to us that US shareholders partake of the success of Infineon appropriately, not least by way of an appropriate dividend, given the good business performance in the past financial year and the positive look for fiscal 2019, the management board and supervisory board recommend another increase in the dividend this year by to per share. And so doing Infineon has been paying a dividend without interruption since 2011. This year, on top of that, we raised it for the 6th time For a company subject to cyclical fluctuations like ours, this is anything but a matter, of course. The management board and the supervisory board adopted a dividend strategy that has now proven very sustainable over the years. Moving on to personnel affairs. In view of the successful work of the management board, the supervisory board, decided on 5th March 2018 that the Office of Mr. Azam which would have expired on the 31st December 2018, was to be extended by a further 5 years. The offices of Doctor. Gaza and Hanabeck, which expired on the 30th June 2019, were extended by a further 5 years as per the resolution of the Supervisory Board passed on 3rd August 2018, their extensions run until the 30th June 2024. In November, Mr. Adam informed the supervisory board that he was offered the post of Chief Financial Officer at Airbus SE. Mr. Azam requested that his employment contract on the management board be canceled as of 1 April 2019. It was with deep regret that the supervisory board granted him this wish. My dear, Mr. Asam, I would like to express you my sincere congratulations and thanks for the outstanding work that you have done, both personally and also on behalf of the entire supervisory board, you were instrumental in the outstanding financial positioning of Infineon and that the outstanding work of the entire management board was recognized by shareholders. We wish you all the best of success. In your new task. Immediately after the notification from Mr. Azam and the decision of the supervisory board, to let Mr. Azim go, we've launched the process to find a suitable successor to him. In a diligent selection procedure, we commissioned a renowned personnel consultancy and establish the criteria together with the firm for selecting a new CFO for our company. We also determined that the search should focus on female candidates and that internal candidates should also be included in the selection procedure We haven't reached the end of the road here, but we are confident of being able to complete the selection process soon with a good outcome. For Infineon. That rounds up my statements on the personal matters. Ladies and gentlemen, I would like to take the opportunity of this AGM today to report on management board remuneration in line with item 422 of the German corporate governance code, the supervisory board commissions, regular reviews of the management board remuneration system from an independent remuneration expert. It is audited for its legal conformity as well as to its appropriateness. The last such audit was conducted in 2016 Therefore, in the past financial year, the Supervisory Board commissioned an independent external remuneration expert to review the compensation system at Infineon as well as the target annual salaries of the management board members once again. The remuneration expert arrived at the following conclusions. First, the compensation system is in line with statutory regulations, as well as the recommendations of the code. 2nd, the management board's compensation is appropriate compared to the mark is comparable to the market and appropriate and the variable compensation is in line with the company's sustained development. 3rd, the individual target annual salaries are appropriate based on a horizontal and vertical comparison. The results of the review were presented Presidual Committee on the 25th October 2018. And to the plenary on the 20th November 2018. The Supervisory Board endorses the opinion of the remuneration experts further details on the management board's compensation, in particular, the emoluments received by each of them in fiscal 2018 can be found in the detailed compensation report in the annual report, moving on to the declaration of compliance. As following, the retirement of Mr. Maya Huber on request from the supervisory board In parallel to my function as chairman of the Investment Finance And Audit Committee, I was asked to assume chairmanship of the overall board, the declaration of compliance had to be updated after my election in February 2018. The new declaration, the management board and the supervisory board in deviation from item 532 Paragraph 3 sentence 3 of the German corporate governance code, declared that the chairman of the Supervisory Board may not have chairmanship of the Audit Committee at the same time. Ladies and gentlemen, I would retire from the Supervisory Board with effect from the end of the AGM in 2020. We, on the supervisory board, therefore, decided that, I will retire from the office Chairman of the entire board in August of this year, affording Doctor. ADA the opportunity to put himself up for election. This will deal with the deviation from the code. Irrespective of that, Infineon continues to follow all of the recommendations of the German corporate governance code, And of course, we will continue to comply with the code in the future. Last but not least, let me address one last corporate governance issue, the efficiency audit as every year, the supervisory board in the reporting year reviewed the efficiency of its work and cooperation with the management board. Since the audit in fiscal 2017 was carried out with the support of an external independent consultant, the supervisory board reviewed the efficiency of its Questionnaire. The audit resulted in a positive picture of the activity of the supervisory board and its cooperation with the management board. No notable shortcomings were identified. Ladies and gentlemen, this brings me to the separate financial statements and the financial statements for the group, the Investment Finance And Audit Committee and the plenary of the supervisory board, concerned themselves in detail with the parent company and group financial statements of Infineon Technologies AG and the Infineon Group, the combined review of operations and the reports of our independent auditors, KPMG, the independent auditors issued an unqualified opinion to the separate financial statements and the group financial statements. The supervisory board endorsed the results of the audit by KPMG on the 20th November 2018. We did not have any objections against the financial statements or the audit by the independent auditors and adopted the separate financial statements and the group financial statements for 2018, the parent financial statements for 2018 are thus adopted. The Investment Finance And Audit Committee further concerned themselves with the non financial report and the group report for the 30th of as of 30th September 2018, which was prepared by the management board for the past fiscal year for the first time. KPMG, which was the affirmed commission, also issued an unqualified opinion applying the standard of limited assurance. The documents that supported the financial statements were audited by the Investment Finance And Audit Committee of the Supervisory Board and approved The supervisory board adopted the separate non financial report and the group report of the management board. Ladies and gentlemen, this brings me to the end of the report. But before I finish, I would like to make sure that I express my sincere gratitude to our dedicated employees for their outstanding dedication and another outstanding performance in fiscal 2018. I would also like to express my sincere gratitude to my fellow, to the members of the management board and to my fellow supervisory board members for the trusting and very comfortable cooperation. And last but not least, I would like to express my sincere gratitude to you, my dear shareholders, for your sustained loyalty. Thank you so much. And I hope that you remain loyal to Infineon going forward. Ladies and gentlemen, I now would like to hand the floor to the Chairman of the Management Board, Doctor. Ploss, for the report on the state of shareholders, viewers watching the broadcast, and ladies and gentlemen, Infineonion is a firm part of everyday life. And even our products and solutions are not always visible, they make a major contribution to making life easier, safer and greener. We are shaping the future of mobility and helping automotive manufacturers to build clean, safe and smart vehicles. With our power semiconductors, energy can be generated more efficiently, consummated and used. We ensure that device and the internet of things communicate quickly and reliably with people and with each other. We also offered tailored security solutions for the connected world. In this way, we create benefits for our customers and in this way, we create benefits for all of us. Microelectronics from Infinein are the key to a better future and that is why we are successful. With that, I'd like to welcome you quarterly to Infineon's Annual General Meeting. We have been on a growth trajectory since Naffinib began focusing on its strengths. Our revenue has risen by an average of 9.6 percent a year since the 2011 fiscal year. Our relevant markets grew by only 6.6% year over the same period, and that shows that our strategy is working. It's based on technological leadership and a broad technological portfolio. It's based on our focus on the key challenges facing our society. And it's based on an understanding of our customer's systems. There are more than 40,000 people working for Infineon who embody these skills. And by the way, 11,300 of these are in Germany. Their expertise, passion and dedication make Infineon an innovative company that is respected by customers and competitors. Together, we've added a further chapter to Infineon's success story. I'd like to thank all the colleagues on behalf of the Management Board for the exceptional 2018 fiscal year. Shareholders. Infineon continued its growth path in the 2018 fiscal year. We increased our revenue and result significantly and that for the 5th time in succession. The most important figures: revenue, an increase of 8% to 1,000,000,000 segment result, a rise of 12 percent to 1,000,000,000, margin 17.8 percent of revenue Your company is successful, and we want you to share in this success. We therefore propose an increase in dividend to per share. I wish I had the same good news about the share price. Its performance over the past years is not what you or I would have hoped for. We must sum up by saying infinising rude health and economically very successful, but the capital market rate the company's value lower today than at the time of last year's AGM. Why the drop in the share price? Well, the capital markets have become more nervous The reasons are simmering trade conflicts are called down the global economy, fewer newly registered cars, and all this contributes to the ups and downs in the market. Price fluctuations for shares in almost all semiconductor companies have been considerable recently. And the fact is that after 2 exceptionally strong years, the semiconductor market is calming down here and there, the boom is over. We're now in a phase of moderate growth, but we are continuing to grow. At Infineon, we see a mixed picture. Demand is falling in some application areas, such as traditional automotive applications or components for smartphones. But others are continuing to grow dynamically. These include our solutions for electromobility, such as assisted driving and industrial applications and we are prepared for this shift. For the current fiscal year, despite the challenging environment, we expect revenue to grow within our forecast range. We now expect a year on year increase of 9% and a margin of around 17.5%. The market will also offer us enough opportunities in 2019. While some of our competitors are seeing their revenue drop, Infineon continues to grow, and we aim to keep on gaining market share. Why is Infineon growing even in economically difficult times? Well, the answer is simple. Structural trends drive our target markets. Infineon's growth prospects are good during all the phases of the business cycle because we have solutions to the big issues that will also shape our society in the next decade. Firstly, traffic is increasing worldwide. It puts a burden on the environment and the climate. The world needs smart and sustainable forms of mobility. Mobility of the future is electric connected and autonomous. Semiconductors from Infineon are the key to that. Secondly, natural resources are dwindling. At the same time, the global demand for energy is growing. Energy efficiency and reliable power supply from renewable sources are vital. Semiconductors from Infineon enabled the generation of renewable energies with higher efficiency and effective energy management. Thirdly, we human beings are producing more and more data and environment is becoming smarter all the time. All these data have to be processed quickly and reliably, and that's only possible with powerful communications and IT infrastructures. Connected devices, perceive the world around and thanks to cutting edge sensors, then enable new services and assist us in everyday life. Infineon connects the real world with the digital world. Fourthly, Our need for security is also growing as interconnecting increases. Customers want to decide for themselves which of their data are used by home and for what purpose. Infineon offers robust and reliable security solutions for the connected world. Security creates trust and customer's trust is the crucial success factor for every company in the digital world. Infineon benefits from these major growth drivers, mobility, energy efficiency, the Internet things, big data and security. They will ensure that demand for Semiconductors rises sharply for many years to come. We are excellently positioned with our technologies and that is why we feel very confident. Infineon is a long term growth stock. Ladies and gentlemen, More and more areas of everyday life are using the possibilities offered by digitalization. And to do that, we need a lot of electric power. Efficiency is growing in importance. Energy's segment chips are Infineon's core business. We generate on 2 thirds of our revenue from power, semiconductor this is a field where we've been the world's number 1 for 15 years. For our customers, the question of using less energy and achieving more with it, and that is precisely what Infineon's power semiconductors do in electric cars and trains in wind turbines and solar power systems in power supply units for mobile phones and notebooks and data sensors in domestic appliances and smartphones. Demand for power semiconductors and minor customers will increase in the long term. Our existing production capacities are not sufficient to ensure that we retain our ability to deliver in the years ahead Our largest front end location in Dresden is expected to reach its capacity limits by 2021. To continue growing profitably, we are taking the next logical step. Infineus going to invest 1000000000 at its site in Villa Austria over the coming years. We're building a new highly efficient factory for power semiconductors. We began constructing the building in November and refinished by 2021. And then we'll clean up fit out the clean room and begin production and we'll be guided by our customers requirements. We can control the pace of the ramp up to reflect their demands. We'll only install what's needed But one thing is clear, we need this factory. The new production facility in Filach is a milestone in the company's history. It will deliver 3 crucial advantages. Firstly, we shall extend our lead in power Semiconductors. Because we're investing in leading edge production on large 300 millimeter wafers. They have a huge advantage in terms of capital requirements. Compared to the production small at 200 millimeter wafers and with the same capacity, we can cut costs by more than 20% or in other words less capital for the same growth secondly, We shall secure our delivery capability in the coming years. The announcement of new factory went down well with our customers. Infineon is the right partner for profitable growth. Thirdly, there is significant growth potential. Infineon can generate up to 1,000,000,000 a year in extra revenue from manufacturing additional power semiconductors. And to put that in context, that is around a quarter of our current annual revenue. The new factory will help us lay the foundation for Infineon to be able to keep on growing. We're investing not only in additional production capacities but also in innovation. Innovation is a key success factor for Infineon. In November, we took over Syltetra, In this way, we want to achieve long term competitive advantage in the market for technologies based on Silicon Carbide. Siliconcarbide has superior physical properties compared to silicon. It permits far smaller components that deliver higher performance and that is why it's used in those fields of application where power density and energy efficiency are particularly important. Siltexra has developed a technology called cold split. It will be used to separate crystals very accurately and efficiently. We intend to seize on this advantage in processing silicon carb wafers in our manufacturing operations. The wafers are a significant cost factor. Putting it simply, that technology allows us to make 2 wafers out of 1. We aim to roll out the method in sales production across the next 3 to 5 years, from that we expect to achieve a substantial lasting competitive advantage for Infineon. The method is an important tool in Silicon Carbide applications and the market is picking up. It will help Infineon to secure its supply of silicon carbide wafers in the long term. Infineon is a global company. Our value added chains are global, but we do not forget that our roots are in Europe. This is the source of our expertise and innovation. It is here that we can preserve and safeguard our valuable know how. And that is the reason why we're in filler as well. That's also the reason why we're taking part in the European Union's efforts to strengthen microelectronics as a key technology in Europe. 1 major success for Infineon Europe in this context is the decision by the European Commission in December to approve a special project to promote microelectronics and nano electronics. It's called an important project of common European interest. Infineon was one of the driving forces behind the project apart from Germany, France, Italy and the UK are participating. What is involved here? New Technologies are the basis for Europe's global success Today, European companies are strong in developing things, but the new technologies are then off news commercially, by companies outside Europe. The funded project is a landmark here for the first time company's research and development activities will now be supported throughout the entire process of creating innovations. In other words, right the way down to commercial use, The German government's driving force behind this project. It's making playing a major role in the needs to be implemented. Infineas, one of the industrial partners. We should invest around 1,000,000 in our German locations in the Reaganburg, Wasthein and Dresden. And that includes about 1,000,000 of government funding. This will enable us to invest much more rapidly and to drive forward our innovation more quickly. Microelectronics is a key factor for innovation. With this project, the German government, together with the EU, will strengthen the innovation chain from the semiconductor material to system applications. In this way, system vendors such as those in electrical engineering, mechanical engineering or the automotive industry will obtain innovative key components more quickly. It's good for the companies involved. It's good for economic development and it's good for progress in Europe. Significant advances also being made in field of electromobility. The trend towards electric driving is picking up pace, strict to CO2 thresholds and falling sale of diesel cars, the pressure on manufacturers is high. They're converting their factories and launching more and more models with an efficient electric drive. Government incentives to buy electric cars such as in China are buoying this dynamic trend further. Vehicles from electric drive need far more power semiconductors than ones with a combustion engine. To give you an idea, In a conventional car, semiconductors are used with an average of around US375 dollars. In a fully electric car, it is US750 dollars, twice as much, in other words. And in particularly powerful electric cars, the value of the semiconductors is well over $1000 Electramobility is good for Infineon. Demand is rising rapidly, and we are in an excellent position, thanks to our technologies, our revenue from solutions for the electric powertrain is growing. In fiscal 2018 alone, it increased by around 50%. And in this fiscal year too, we again expect a similar high rate of growth. A strategic important step for Infineon here is our joint venture with Sykes Motor Corporation in China. We founded it about a year ago. China is the largest and fastest growing market for electric vehicles. The joint venture makes and sells electric drive modules for the Chinese market. You may recall that at last AGM, presented a module from our Hardrick Pack family. It governs the electric engine's speed. Production of these components at our site in Uushi began in August. The joint venture has given Infineon an excellent springboard in the Chinese market. Electromobility is becoming increasingly well established in China and also in Germany. One example, the street scooter. It's a rugged economical electric commercial vehicle. You probably know the street scoot completely painted yellow. The German the company, Deutsche Bosti Edchelle, has 8 cars in all these vehicles on German roads. And the Street scooter is going down well with many other companies as well. And what at Infineon, we're happy about that. Why? Because there are more than 30 of our Semiconductors in Components Street scooters, electric powertrain, They ensure a highly efficient electric drive. Here you can see a second example. It's the ID. It's the first Volkswagen designed purely electric car, electromobility for all made in Germany. The ID will be on the road next year, might have read about it in newspapers in recent days. Volkswagen is already training its deals for the launch of the ID series. You can see the ID concept vehicle today already at the AGM. The battery cells are in the car's floor. The advantage is it gives a longer wheelbase and therefore more space in interior. Even so, the ID is similarly compact to the Gulf and with a range of up to 3 20 miles, It's suitable even for longer journeys. The idea is also the first car from Volkswagen that will be able to drive fully automatically in future. The ID and the street scooter are waiting for you in the lobby. Just have a look at them afterwards. Our colleagues at the stand will be held. Happy to help you there. It goes without saying that we at Infineon think holistically eco for any mobility mobility also means that the power for the electric car comes from renewable sources. Infineon supplies key power components for the energy transition. We supply them to all major manufacturers of solar inverters and wind turbines. Technology from Infineon Helps generate clean energy from the wind and the sun. It also enables the efficient transmission of electricity. One thing is clear, for Electromability to achieve a breakthrough, we need a comprehensive charging infrastructure and charging times have to become shorter. In Finian, recently commissioned a representative survey, and this reveals that people's tolerance threshold when traveling is 30 minutes for recharging. Most of those surveyed won't accept a longer time. And to be honest, I think 30 minutes is still too long for a refueling stop. Infineonasa technology for shorter charging times, We supply all the main semiconductor solutions for high speed charging points. In each of these points, there's power semiconductors worth several 100 US dollars They deliver charging power of up to 3.50 kilowatts. As a result, an electric vehicle can be charged in 7 minutes with enough electricity to cover 100 and 25 miles. 7 minutes at Saint Laurent takes to fill up a car conventionally at the petrol station sustainably generate electricity, power grids, charging infrastructure, electric drives in the vehicle, Power Semiconductor Infineon are paving the way for comprehensive electromobility. In addition, we support our customers on the way towards the connected and autonomous vehicle. In five years' time, there'll probably more than 100,000,000 connected cars on the road. They'll be able to drive more and more independently They'll communicate with each other and the infrastructure for example by sharing traffic news in real time. The advantages of connecting the assisted driving for human beings are very varied. Being connected means better traffic flows with a fewer traffic jams. We save a lot of time on the way to the office or going on holiday. A better traffic flow saves money vehicles consume less fuel. Less fuel consumption is good for the air and the climate because the vehicles emit fewer pollutants at the same time. Connected driver assistance systems, increased safety, and help to reduce road accidents, Most of which nowadays are caused by human error. It will still be a few years before we see completely self driving cars, but they will come. And then we can sit back and relax on the road just like the lady in the picture here. With self driving vehicles, many people will be able to look forward to enhanced individual mobility Millions of communities no longer need to concentrate on the traffic. They can use their journey time productively. The elderly and children who don't want to or not allowed to drive themselves nowadays can move much more freely. The vehicles must be absolutely reliable, of course, so that the main advantages of Connect and Automotive mobility can be used successfully? Or would you like to reconcile you don't trust 100% hardly? The systems have to be's fail safe. That begins with the components. 0 defects is the slogan. Our customers appreciate their outstanding product quality that Infineon delivers. One example is Toyota. The Herrozi plant recently awarded 1 of the highest quality accolades 0 defect quality in automotive electronics over 4 years in succession. Infineon supplies the crucial components for safe and secure driving. Vehicles detect the world around them with our sensors. Our micro controllers process the data collected. Power electronics give the drive the power it needs and our security controllers ensure secure data transfer. Security also means protection against attacks by hackers. All the data interface in the car are potential means of infiltration for cyber criminals. Just imagine if hackers took control of a car It's a dreadful thought. Infineon was the 1st semiconductor manufacturer recently to launch a security controller specifically for automotive applications. The 2nd generation Trusted Platform module from the Octiga family or TPM for short The chip helps to protect the vehicle's communication outside world. For example, when it received software updates from the car manufacturer. The TPM protects the data using cryptographic keys. These are stored in the TPM as in a safe. As a result, communication secured throughout the vehicle's entire service life. The TPM is the result of our strong strategic partnership with Volkswagen. We've collaborated closely with them since 2017, and we're developing semiconductor solutions for the car of the future. Security solutions are one of Infineon's core competencies. This competence benefits sales in all our business segments because robust security solutions are needed everywhere for the energy car, industrial robots for mobile communications, passports and many other applications. The example of the connected and automated vehicle demonstrates that technology is becoming more and more powerful, smart and complex. That is another reason why we are collaborating so closely with the automotive industry. System understanding is a key success factor for Infineon. Software plays a growing role here. That is why at Infineon, we are expanding our expertise in this field. We have to understand the car system, including the software, in order to be able to offer suitable hardware solutions We intend to enhance this system understanding and make it even better. We want to know our customer's system requirements as soon as and as precisely as possible. With any then can we offer opportunities to open up new Semiconductor solutions in existing adjacent or totally new markets. The Internet of Things offers a host of possibilities here. Identifying new markets at an early stage and to developing suitable applications is a major task. It can be done best with the right partners. That is why Infineon is committed to cooperation with customers startups and other tech companies. Together, we're speeding up innovation and I'd like to give you three examples. At our Innovation Center in Silicon Valley, we're working with customers and partners to develop new technologies, applications and markets. The focus is on autonomous driving and cutting edge sensors in Singapore, in Autumn, we inaugurated our 1st co innovation space, where we're working with interest in startups. Infineon benefits from their ideas for new digital applications. The young companies benefit from our technical expertise, products and market experience at our location in Dresden, we're creating a new development center for Automotive electronics and artificial intelligence. In Connect, Tidtraffic Systems, artificial intelligence AI, is already playing a key role. We intend to exploit and know how in the automotive field to offer AI solutions to other target markets. The situation in Dresden offers excellent conditions here. Artitutional Intelligence, a key technology in digitalization. It enables to act independently better. As a company, we are exploring what we can achieve with artificial intelligence. It's not with blind faith in technology, but with a critical eye for AI's benefits to people. A lot is technology feasible, but not everything makes sense. And that is why Infineon is playing an active role in the political and social debate on the issue of artificial intelligence. Infineon is a much sought after Dialog Partner We're a member of the Federal German Government's Study Commission. We advised the German government on AI, and we support the German needs the German platform for learning systems. It's an export form that champions fair and responsible use of artificial intelligence. It formalized proposals for how Germany can position itself properly to tackle the AI age. We at Infineon support that because we want to make a contribution to assume that digitalization serves people. In the near future, we shall be sharing our lives with more and more smart machines. There'll be as commonplace as smartphones today. Will work hand in hand with robots. They'll take over jobs that are monotonous physically strenuous or danger for human beings. With their support, their work will be more productive, safer, and less of a strain. Robots will always help us in the private sphere as well, just in home or in care and nursing and then take on more and more tasks there. A major trend in the industry is collaborative robots. They are replacing or complementing traditional robots and they work with people directly without protective grill separating them. These cobots, as they're called, are currently the fastest growing robot segment, Infineon has the important technologies that these collaborative robots need. Our Semiconductors microcontrollers, sensors and security solutions. At our last AGM, you saw a cobot. The panda from Franco Emica. And by the way, that robot also took part in the groundbreaking ceremony in filler. So Cobalt's not only useful, but it's also fun to work with them. Collaborative robots are there to support and assist people. Working with them is intended to be as simple and intuitive as possible for us. One solution to enable present this was developed by the young company, WendelBot from Dresen. Our colleagues at Preston are cooperating with RandleBot. And so I'm delighted that Christian picnic from Randlebot's is here today. Christian? Kristen, you've developed a solution with which anyone can teach Robert and know about how to do things. That any knowledge of programming quite simply by showing it what to do and the robot learns then from the people directly to simply Copesan. Just what it looks like can be explained in a video. Yes. Well, I've got a video with me to make it a little clearer. What you can see here is a typical process from semiconductor manufacturing, you've got a cassette with, filled with silicon wafers, robots supposed to pick it up and put into a machine. We teach it. You can see there's a human being. It's got a jacket on. The jacket has a sensor in it, which detects the body movements. And then transmit it live to the robots. So this completes the possibility to teach the robot examples and the software in the background learns on a the data created, how the automating process works. So in the end, the software is capable of generating a solution to use this robot ideally. What is done is generated automatically. Then in the second step, this tablet application for making some fine tuning. And finally, we'll generate a fully integrated process. What I can see here to make it a little bit more difficult is that once the robot has salted task, the cassette is not in exactly the same position as when it's being trained, but in a slightly different position, we use a three d camera of an Infineon, which allows the robot to perceive its environment so that Robert is able to see the cassette and then to adjust its own behavior to the situation and all is is done without the need to write a second program code. So the transmitter makes the, the sensor makes the robot smartened process. What we at WunderBot's do is to make robots democratic as it were. So people irrespective of the technical background and irrespective of what cultural background they have they are given the possibility of simply training and programming any industrial robot in the world simply by demonstrating it. That's a brilliant idea. Well done, Christian. I wish you every success for your company. It's very impressive what you've done in such a short time, how long have you been there? Well, about 14 months, we're not quite that old yet. How big are you? How many employees have you got? Wonderfuls? It depends who you ask and who you can't it's 26th the next month will be 30, so we're growing well and we're going in the right direction Well, if I were a bit younger say around 30 or 40 and were faced with a choice of what to do next, I think I would apply for a job at WunderBot thank you, Christian, every success. And I must say I find it fascinating what the young technological startups can do in Germany here. And it's also clear to us that we work together with great enthusiasm We are industrialization partner there and no other companies that are also using these robots so that they can become better themselves and I think it is a major element for the future of Germany as a location and for Europe. Well, yes, that's something exciting you shouldn't miss. You can go and see the robot close-up in the lobby. Afterwards, come around to the lobby and you'll find Mr. Preeting at his team at our stand. Innovations like that from WunderBot begin with a good idea. From the idea to the perfect solution is unusually a long and stony path. In the digital transformation, there is one crucial ability that companies must have to drive new applications quickly to put on the market rapidly and then to perfect them. To hone this ability systematically is what we're doing at Infineon. We want to become better all the time. Ladies and gentlemen, 2018 was a successful year for Infineon. We keep our promises. Our Chief Financial Officer, Dominic Azamas, also kept a close eye on ensuring that Dominic, you've decided to leave Infineon. You've worked for us for more than 10 years. As of the 1st April, you're now moving to Airbus's Chief Financial Officer. That is an honor, which is a testimony to your achievements Infineon. You've done outstanding work for this company for Infineon. And you've made a major contribution to developing Infineon further. Your sites have always been on the interests of all the stakeholders and on the company's sustained success. Infineon is now in an excellent financial position. And not just financially. Working together on the management board with you Hemorgasmiojanejanebeck was very successful. I, we always enjoyed it greatly. On behalf of all our colleagues in Finian, I would like to say thank you Dominic. We regretive very much that you're leaving us, but we wish you every success for your next challenge. Shareholders Your company is doing well. Infineon is in root health Infineonion is growing. Infineon's innovative and is continuing to develop. The future offers us many opportunities and we shall take advantage Field Dan Catock. Thank you, Doctor. Prosper your report. I'd now ask our CFO Mr. Azam, to give us his financial report. Yes. So next time I'll Yes. Well, thank you, Doctor. Sune for the kind recognition. Of course, Thank you as well, dear Reinhard, for your warm words. My duties at Infineon and work with all of you have always been a pleasure for me as well and continue to be. So I don't want to begin my speech with words of farewell but we'll first report to the annual general meeting on the company's finances. Ladies and gentlemen, good morning. Infineon continued to grow in the 2018 fiscal year. Revenue increased by 8%. The actual growth if in the automotive sector, industry and in the field of power management. The segment result margin improved by 0.7 percentage points to 17.8% and was therefore above the forecast at the beginning of the last fiscal year when we expected a figure of 17%. That is a noteworthy result, especially given the headwind from the weaker euro to US dollar exchange rate. The exchange rate peaked at 0.25 and its low was 1.13. Its average for the year was 1.19. The rate for the previous year was 1.11 so the dollar depreciated by around 7%. Nevertheless, we delivered what we promised As a result of our strong growth, we surpassed the billion mark for revenue for the first time in our current setup in fourth quarter of 2018 fiscal year. Ladies and gentlemen, as you can see, Infineon is continuing to grow both strongly full year by 36 percent to 1000000. Our earnings per share rose from 1000000 to and adjusted earnings per Net income and earnings per share grew at a higher rate than revenue due to the improved result margin as well as due to the million gain on the sale of major parts of our radio frequency power business to CRE. Now let's move on to the segments. Infineon grew its revenue by 10% in both Automotive And Industrial Power Control. And by 8% in power management and multi market. Against the backdrop of a very weak market, the Digital Security Solutions segment posted a 6% decline in revenue. According to the most recently available market data, Infineon was able to gain share and is now the new market leader by a narrow margin since we see significant business opportunities at digital security solutions in the medium to long term due to the mounting importance of IT security, we also intensified our research and development and sales efforts in this segment. This led to higher operating costs and a decline in the segment result. The segment result margin for the Automotive segment decreased slightly. For electromobility due to the large investments in development and manufacturing the profitability of these products is not yet at the average margin level of the Automotive segment. However, for the other two segments, we were able to achieve growth in the segment result far in excess of revenue growth. The segment result at Industrial Power Control was 1,000,000, a substantial 40% increase over the previous year. We were able to improve the segment result at power management at multi market by 25 percent to 1000000. Now let's look at the distribution of revenue by region. First and foremost, we have grown in all regions. We generated a quarter of our revenue 1,921,000,000 in China alone. Germany contributed 1,171,000,000 or 15% of the total figure. Japan accounted for 7% of our revenue and was the region in which Infineon achieved its highest revenue growth in percentage terms namely 15%. It is a particularly large and important market for automotive and industrial applications, but so far, It has been dominated by domestic suppliers. We see the fact that this region is gradually opening up to us as a clear sign of the competitiveness of our technologies Now let's move on Our research and development expenses amounted to 1,000,000 and, hence, 11% of our revenue they are thus still within the target range of a percentage of revenue in the low to mid teens. We had to capitalize million of development in the 2018 fiscal year and thus reported as capital expenditure according to International Financial Reporting Standards. Taking into account additional government funds and grants of 1,000,000, we invested a gross total 1000000000 in research and development. This corresponds to an impressive 14% of revenue. Selling, general and administrative expenses were 11.2 percent of revenue in the 2018 fiscal year, compared to 11 I would like to mention at this juncture income from discontinued operations. It was a negative million in the 2018 fiscal year and is mainly attributable to the increase in provisions for Kemonda in connection with pending legal proceedings. In September, the court appointed independent expert provided an interim report on the preliminary valuation of the memory business that Infineon contributed to Kemonda in 2006. We can't provide any details from the report at present, but two points are important Firstly, as you can see from the provision we have formed, the result of the interim report on the preliminary valuation essentially only represents a fraction by the insolvency administrator secondly, in principle, we are open to an out of court settlement on reasonable terms. We can't comment on Free cash flow in the past 1000000 or 4 percent over the 1,000,000 in the 2017 fiscal year. This figure includes the cash received in connection with the sale of the major part of our radio frequency power business to Cree. On the other hand, there were cash outflows in connection with the establishment of a joint venture with SAIC Motor Corporation Limited in China and the acquisition of the startup company Mirus Audio in Denmark as well as investments that were higher than originally anticipated. By far, the largest share of investments in property, plant and equipment were capital expenditures at our manufacturing sites, around 2 thirds of that went to our front end facilities and the rest mainly to back end facilities. Investments in intangible assets rose from 1000000 to 1000000. The lion's share of that was attributable to the previously mentioned capitalized development costs of 1,000,000. And now, look at our balance sheet. Our total assets, as of 30th September 2018, were 1000000,879,000,000, an increase of 1000000 compared to the 30th September 2017. Our financial liabilities fell by a total of 1,000,000 That figures includes the redemption of a bond amounting to 1,000,000. Our total equity increased to 1,000,000,000, Our return on capital employed, ROCE was 20.5 The rise is mainly due to the higher operating income from continuing operations after tax which increased significantly jumping by 49% from 1000000 in the previous year to 1,000,002 163,000,000, This also reflects the sale of major parts of our radio frequency power business Despite the positive trend in our key financial figures, our share put in a negative performance. We're obviously not satisfied with that. The Infineon's share price fell by 9% between the start of the past fiscal year on 1st October 2017, and the close of the market last Friday. Please note that in that period, Infineon significantly grew its revenue and segment result for the 5th time in a row and set itself more ambitious long term targets. We also outperformed the DACs again, which declined by 12% over the same period due to geopolitical and macroeconomic uncertainties as well as the unresolved trade conflict between China and the United States. The Philadelphia Semiconductor index, however, rose by 15% over the same period and thus clearly outperformed Infineon's share price. Our business model is geared toward long term structural growth. A certain level of future oriented investments is required for that. Those investments may temporarily weigh on our margin in the event of an economic slump as a consequence of the resulting idle costs. In times of extreme economic uncertainty, a larger share of investors prefer companies with a less aggressive growth strategy or turn to industries that are perceived as being more stable. However, we would be ill advised to call our strategy into question just because of that. We are continuing our growth trajectory of the past years while reducing our investments in the current fiscal year due to the economic as that does not impair our We are continuing to pursue 2 goals with our dividend policy. We want our shareholders to have their fair share in Infineon's economic development and we want to keep the dividend at least at a constant level, even in times of stagnating or declining earnings. Net income is not the crucial criterion for us, and we have not defined a fixed payout ratio. My apologies. One of the reasons for that is that there may be exceptional effects such as last fiscal year's profit from the sale of major parts of our radio frequency power business. Which I mentioned earlier. In connection with agenda item 2, the supervisory board and management board proposed a dividend of a share other words, an increase of 8% over the previous year in view of the results achieved in the period under review and the positive business outlook. This brings me to the outlook. As Doctor. Plos already mentioned, we now expect revenue to grow by 9% in the 2019 fiscal year. Given that forecast revenue growth, the segment result margin should be around 17.5% assumes an exchange rate of We expect to see rising demand for power semiconductors driven by electromobility among other things. However, we are adapting our investments to the lower growth in selected areas and, for example, by postponing the procurement of certain manufacturing tools and equipment to a later date. We plan to invest a total of around 1,000,000,000 this year, 1000000 to 1000000 less than we had originally intended. Ladies and gentlemen, Infineon still has a solid capital structure and and investment grade rating. As recently evidenced by the reconfirmation of our BBB rating with a stable outlook from the International Rating Agency S And P Global Rating. Since we are at the upper end of our target range for our gross cash position and well below it for growth debt, We have some leeway Infineon developed very well in the 2018 fiscal year, the bold investment decisions of the past years have paid off. Our measures, which we announced in the context of our quarterly report on the 5th February, reflect the current economic cooldown. Long term, however, we see relenting unrelenting structural growth potential in a large number of different fields of application where Infineon has a particularly strong presence. That's why we're sticking to our targets for revenue growth the segment result margin and the investment to sales ratio over the cycle, all of which we raised last fiscal year. As a reminder, our goal was to grow revenue by an average of 9%. The segment result margin is to be above 17%. Higher investments are required to On top of that, as announced, we will invest around 1,000,000 in front end clean rooms and choice large office buildings. In taking investment decisions, we will continue to follow our tried and tested strategy of fully leveraging our medium to long term growth potential. Key could criterion for our customers, we're convinced that by investing during all phases of the business cycle, we will not only offer our customers the greatest value added, but also provide you our dear shareholders with an attractive return on your investment in Annual General Meeting at Infineon, I wish, last but not least, to express my deepest gratitude to the Supervisory Board for their trust and to my fellow management board members for our excellent working relationship, even though I'm very much looking forward to my new challenge, I'm also sad to be leaving a company that is in great shape has excellent future prospects and can rely on outstanding employees. Am proud and honored to have contributed to Infineon's success over the past years and hope that you are also satisfied with how your company and its share have performed. I would like to express my particular thanks to you ladies and gentlemen for your attention and for your trust in Infineon Funan Duncan. Thank you, Mister Asam. I can only repeat it. We shall miss you solely here. Alright. To take this opportunity, Since the comments by the board have finished to tell you how many people are present today, At today's AGM of the total registered 1196 of 595,431 shares, 768,933,000 174 shares are present with the number of votes. This constitutes of the regular capital there is a total of 6,000,000 shares which do not have voting rights. It means that today we have 67.63 percent of the registered capital present today and represented. In addition, there are postal votes for another 3,730,000 shares, another 0.31 percent of the registered capital, which when these are added, together, we arrive at a total of 67.94 percent of the registered capital, which is represented. The list of those represented can be seen electronically on the screens which are outside the entrance Since the presentations by the board members have now been finished, the general internet broadcast is now being switched off. In