Maxwell Technologies August 2014 Mike Sund Vice President, Investor Relations msund@maxwell.com +1 858.503.3233
Forward-Looking Statements Statements in this presentation that are forward-looking statements are based on current expectations and assumptions that are subject to numerous risks and uncertainties. Such risks, uncertainties and contingencies include, but are not limited to, the following: Dependence upon the sale of products to a small number of customers and vertical markets, some of which depend heavily on government funding or subsidies which may not continue in the future; Risks related to our international operations including, but not limited to, our ability to comply with changing rules and regulations in countries where we conduct business, our ability to oversee and control our foreign subsidiaries and their operations, our ability to effectively manage foreign currency exchange rate fluctuations, and our ability to continue to comply with the U.S. Foreign Corrupt Practices Act, anti-bribery laws of foreign jurisdictions and the terms and conditions of our settlement agreements with the U.S. Securities and Exchange Commission and Department of Justice. Our ability to remain competitive and stimulate customer demand by successfully introducing new products and matching our production capacity to customer demand; Dependence upon the sale of products into China and Europe, where macroeconomic factors outside our control may adversely affect our sales; Acquisition, development and retention of key personnel; Our ability to effectively manage our reliance upon certain suppliers of key component parts and specialty equipment; Our ability to manage product quality problems; Our ability to protect our intellectual property rights and to defend claims against us; Our ability to enter into, manage and benefit from strategic alliances; Occurrence of a catastrophic event at any of our facilities, and, Our ability to obtain sufficient capital to meet our operating or other needs. Many of these risk factors are beyond our control, and there can be no assurance that we will not encounter additional unforeseen risks and costs in the conduct of our business. Forward-looking statements included herein do not purport to be predictions of future events or circumstances and may not be realized. The Company undertakes no duty to update any forward-looking statement to reflect actual results or changes in our expectations. 2
Maxwell At-A-Glance Overview Founded in 1965; IPO - 1983 NASDAQ listed (MXWL) Corporate Headquarters: San Diego, California Global Presence 450 employees worldwide Sales: U.S., Switzerland, Germany, China, Korea Manufacturing: United States, Switzerland, China Target Markets Leading global supplier of Ultracapacitor energy storage and power delivery solutions for transportation and energy applications Financial Highlights 2013 revenue: $193.6 million Gross profit margins averaging ~40% 2013 Revenue ($M) 7% 22% $43.3 $13.9 $136.3 70% Ultracapacitors Microelectronics High Tension 3
Industry Leaders in Innovative, Affordable Energy & Power Solutions Growing Large Markets Target markets over $1 billion in 2020 (19.2% CAGR) Experienced Team Deep technology and industry expertise, track record of delivering growth & value Unique Portfolio Extensive, best-in-class portfolio of Ultracapacitor, High Voltage and Microelectronics solutions Strong Financials Solid revenue growth, profitable, solid balance sheet and cash generation Global Customer Base Winning with world s leading transportation and energy brands 4
Financials: Operating from a Position of Strength Revenue ($M) Gross Profit % $250 45% $200 $150 $100 $101.3 $121.9 $147.2 $159.3 $193.5 42% 39% 36% 34.8% 38.7% 39.0% 41.3% 39.5% $50 33% $0 2009 2010 2011 2012 2013 30% 2009 2010 2011 2012 2013 $25 $20 EBITDA ($M) $20.3 $21.7 Strong revenue growth 13.8% CAGR over the last 5 years $15 $10 $5 $0 ($5) ($10) $6.9 $0.067 2009 2009 2010 2011 2012 2013 $5.5 Gross profit margin increased by 27% over the past 5 years Profitable growth generating cash over $30M cash balance 5
Accelerating Ultracapacitor Revenue Maxwell s Growth Engine 5-Year Revenue ($M) $140 $120 $100 $80 $60 $40 $20 $- Ultracapacitors $136.3 $86.8 $96.0 $68.5 $43.8 2009 2010 2011 2012 2013 C E L L S M O D U L E S Revenues have grown at 32.8% CAGR over last 5 years Transportation and grid applications are main revenue growth drivers Investing and expanding product portfolio to drive accelerated revenue growth T R A N S P O R T A T I O N G R I D 6
Ultracapacitors: Rapidly Capture Electrical Energy and Deliver Power Requirement Ultracapacitors Batteries Combination Rapid Energy Capture <1 second 2-5 seconds < 1 second Rapid Power Delivery <1 second 2-5 seconds < 1 second Extended Temperature Range Excellent Poor Good Product Life 8-15 years 2-6 years 4-10 years Run Time (Energy) Seconds to Minutes Minutes to hours Seconds to hours The Power of Ultracapacitors combined with Energy of Batteries: 2x Enables rapid response times Extend operational temperature range Lengthens battery life by up to 2x 7
The Global Energy Dilemma Unquenchable thirst for energy and power with mandate to reduce emissions World Energy Demand CO 2 Emissions Reductions Market Adoption 2x Energy consumption doubling by 2050 Halve Global Emissions by 2050 Early Adopter Early Majority World energy demand to double and emissions to halve by 2050 Requires innovative energy and power delivery solutions Transportation & grid markets reaching early adoption with key inflection points ahead Target markets growing at 19.3% CAGR over 7 years reaching >$1B by 2020 Sources: Market Size (units) and Application(s) adoption Navigant, Deloitte & Touche, Frost & Sullivan, Maxwell Independent research and publicly available data. UCAP sales & UCAP content Maxwell internal projection based on historical trends and customer feedback. 8
Transportation: Bus, Auto, Rail, Trucking 5-Year Revenue ($M) Market Adoption by Segment Transportation Market Segment Revenue $100 $91.8 $80 $67.7 $60 $46.6 $40 $20 $12.3 $23.5 $0 2009 2010 2011 2012 2013 Early Adopter Early Majority Early market leadership driving significant revenue growth 49.5% CAGR over 5 years Stringent long term regulations mandate increased fuel economy & reduced emissions Platform electrification accelerating Ultracapacitor adoption Transportation markets to grow at 21.6% CAGR reaching >$700M by 2020 Sources: Market Size (units) and Application(s) adoption Navigant, Deloitte & Touche, Frost & Sullivan, Maxwell Independent research and publicly available data. UCAP sales & UCAP content Maxwell internal projection based on historical trends and customer feedback. 9
Broad Ultracapacitor Application in Transportation Markets Ultracapacitors meet the increasing power demands of Transportation ndustries BUS AUTOMOTIVE RAIL TRUCKING Hybrid Plug in Hybrid Electric Bus Engine Starting Start / Stop Regenerative Braking Power Assist Hybrid High Power e-turbo Active Suspension Regeneration Propulsion Voltage Stabilization Engine Starting Engine Starting Hybridization Operating in over 15 thousand hybrid buses and 1M start / stop vehicles worldwide Leveraging leadership in auto and bus to capitalize on new emerging opportunities First rail wins for electric propulsion, deliver significant energy & infrastructure savings Major US truck OEM s evaluating Engine Start Module for enhanced engine starting Over 7M ultracapacitor cells shipped into transportation applications 10
Grid: Wind Energy, Backup Power, Grid Storage 5-Year Revenue ($M) Market Adoption by Segment Grid Market Segment Revenue $57 $71 $72 $68 $71 2009 2010 2011 2012 2013 Early Adopter Early Majority Established partnerships driving solid revenue growth 5.8% CAGR over 5 years Government policies driving more renewable power generation Aging infrastructure requires fast response storage to stabilize output and improve reliability Grid market segments grow at 14.1% CAGR reaching >$400M by 2020 Sources: Market Size (units) and Application(s) adoption Navigant, Deloitte & Touche, Frost & Sullivan, Maxwell Independent research and publicly available data. UCAP sales & UCAP content Maxwell internal projection based on historical trends and customer feedback. 11
Broad Ultracapacitor Use in Grid Markets Ultracapacitors meet growing peak power and long life demands of grid market WIND PITCH RENEWABLES TRADITIONAL RAIL WAYSIDE Boost Power Assist Fail Safe Backup Solar & Wind Firming Ramp Rate Control Frequency Regulation Voltage Stability Peak Shaving Load Shifting Gen-set Starting Power Stabilization Spinning Reserves Bridge Power Backup Power Energy Recuperation Power Stabilization Frequency Regulation Operating in over 30,000 wind turbine pitch control systems worldwide Renewable firming demonstrations in US, Europe and Asia Deployed in backup and gen-set starting where rapid response power is business critical Growing number of commercial grid power wins in rail wayside market Over 8M ultracapacitor cells shipped into grid applications globally 12
Key Differentiation Capabilities Core Competency & Differentiators Growth Investment Focus Core Technology Proprietary Processes Solution Platforms Strategic Partners Customer Intimacy Pioneered core ultracapacitor technology and high-volume manufacturing Proprietary electrode fabrication yields significant cost and performance advantages Expanding strategic partnerships to develop enabling platforms and accelerate adoption Deepening existing customer relationships and acquiring customers in new segments 13
Investing in Portfolio of Differentiated Products 2.85V / 3400F Cell with DuraBlue New 2.85Volt 3400 Farad Cell with Durablue TM Sets new standard in energy and power with most ruggedized cell available ULTRA 31/900 Engine Start Module New Engine Start Module for Medium Duty Trucks ESM Ultra 31 / 900 Delivering Best-in-Class New Products DuraBlue : the world s most rugged ultracapacitor technology Expanded award-winning Engine Start Module line for medium duty trucks Focusing investments to deliver increasing new products & speed time to market Expanding business and technical partners to drive innovation and competitive separation 14
Proven Global Supply Chain Cumulative K2 & D Cell Unit Sales (m) Supply Chain Partners 14 13 12 10 108 9 86 64 4 2 2 4 6 0 2009 2010 2011 2012 2013 Proven high volume supply capacity through long-term supplier relationships Reliable, high quality manufacturing - ISO 9001/14001, OSHAS 18001 & TS 16949 certified 1 st ultracapacitor factory automotive qualification in 2009 Unique dual source electrode manufacturing with scalable production capacity 15
Leadership Team Strong Technology Experience Dr. Franz Fink* President & CEO *Joined Maxwell May 2014 Chris Humphrey* Vice President of Marketing & Engineering *Joined Maxwell September 2013 Gennum, Freescale Semiconductor, Motorola High Tech Growth CEO QLogic, Honeywell, Lantronix, Applied Microcircuits Executive Marketing, Engineering & Innovation John Warwick* Senior Vice President, COO *Joined Maxwell June 2013 *Joined Maxwell February 2014 Dave Wojciechowski* Vice President of Americas Sales Emulex, Lantronix, PRTM/PWC, Western Digital High Tech Executive Leadership ABB/PowerOne, SMA Solar Technology, Emcore Global Sales Executive, Sales Engineering Kevin Royal Senior Vice President, CFO *Joined Maxwell April 2009 Sacha Jenny Vice President & General Manager High Voltage Joined Maxwell January 2003 Blue Coat Systems, Novellus Systems, Ernst & Young Experienced publically traded company CFO Cresco Ti Systems, Silicon Graphics Inc Global Power Grid Expertise & General Management Mike Everett Vice President, CTO Joined Maxwell August 2002 Earl Wiggins Joined Maxwell August 2006 Vice President of Operations 3D Systems; Advanced Power & Energy Development Recognized authority on Advanced Energy Technology Maxtor Corporation, Quantum Corporation Global High Volume Manufacturing & Quality (*new members of leadership team) 16
Strong Foundation Today Positioned for Profitable Growth Solid Financials Large Markets Multiple Growth Drivers Fast Growing Diversified Ultracapacitor Company Balanced and Global Balanced Small Cap Growth Story 17
Thank You Mike Sund Vice President, Investor Relations msund@maxwell.com +1 858.503.3233