Performance Materials is advancing digital living. Our main focus is on the electronics market with our materials and solutions changing the way we generate, access, store, process, and display information. In addition, our highly specialized, application-driven Surface Solutions business makes life more colorful. Together with our customers, we are discovering the next generation of high-tech materials and solutions. With strong growth trends such as 5G and Big Data, and new applications such as autonomous driving and Internet of Things (IoT), we have set the course for future growth.
The business sector consists of three business units: Semiconductor Solutions, Display Solutions and Surface Solutions. Comparing Performance Materials with a smartphone, Display Solutions represents the user interface, Semiconductor Solutions the intelligence, and Surface Solutions the aesthetics. We offer innovative solutions especially for the electronics industry – for microchips and displays – and for surfaces of every kind.
We are well on track with the execution of our five-year Bright Future transformation program announced in 2018. With the completion of the Intermolecular and Versum Materials acquisitions, we achieved two major milestones to transform Performance Materials into a strong solutions provider and leading player in the electronic materials market. After closing the acquisition of Versum Materials on October 7, 2019, our newly integrated organization went live on June 1, 2020. Effective March 4, 2021, we plan to change the name of the Performance Materials business sector to Electronics.
Performance Materials accounted for 19% of Group sales in 2020 and its share of EBITDA pre (excluding Corporate and Other) was 18%. The EBITDA pre margin was 30.3% of net sales.
Semiconductor Solutions is at the heart of electronics and enables transformation in communications, mobility, and healthcare. As almost every electronic device uses one of our products, we are advancing almost every aspect of digital development. We are developing solutions for smaller, faster, and more powerful devices. As an industry leader, we are pushing the boundaries of science and technology to help our customers create the next generation of digital devices and experiences.
Semiconductor Solutions is the largest business unit within Performance Materials. It consists of materials, delivery systems, and services for the semiconductor industry. Our Semiconductor Materials unit supplies products for every major production step in the wafer processing, including doping, lithography, patterning, deposition, planarization, etching, and cleaning. Specialty cleans, photoresists, and conductive pastes for semiconductor packaging round out the portfolio. Our material innovation accelerator Intermolecular is a trusted partner for materials innovation and is our Silicon Valley science hub. Its capabilities allow material combinations to be tested directly in the specific application environment. Compared to conventional methods, this means enormous time savings in the development process, considerably faster learning cycles, and findings on new material combinations, providing a unique service for customers.
The Delivery Systems & Services (DS&S) business enables the safe and responsible handling of gases and liquid chemicals for electronic manufacturers. It focuses on the development and deployment of safe and reliable delivery equipment. This allows our materials to be handled with the highest quality and safety standards for our customers.
Our Display Solutions business unit consists of the Liquid Crystals, Organic Light-Emitting Diodes (OLED), Photoresists, and Liquid Crystal Windows businesses, among others. We are supporting our display customers in the development of novel display technologies and product concepts for applications, while also addressing new requirements that have emerged from the Covid-19 pandemic. With the proliferation of multiple use cases and display trends, technological requirements for the display industry are significantly expanding. We are in a leading position to develop required new display materials and technology concepts to contribute to the diverse display landscape. We remain active in the development of a broad range of display materials, including Liquid Crystals, OLED, Quantum Dots Pixel Color Converters (QDPCC), and Display Patterning Materials (DPM).
In Liquid Crystals we continue to see very dynamic market developments. Covid-19 has accelerated the market shift toward China and increased competition. We maintained our position as the technology leader, and with our XtraBright™ products we were able to win new projects for large-area displays as well as high-resolution mobile devices. Our OLED materials qualified for free-form display-based products that entered the market this year. Our photoresist materials are also being used in flexible displays. Our low-temperature processable positive tone photoresists are widely used to pattern on-cell touch sensors. These sensors enable a thinner display structure, which is crucial for foldable devices. Our Liquid Crystal Windows business reached a major milestone with the opening of the Niemeyer Sphere located at the headquarters of crane manufacturer Kirow in Leipzig, Germany, in July. The prestigious architectural piece is one of the last works of renowned Brazilian architect Oscar Niemeyer. The construction of the building was realized using triangular versions of our eyrise® dynamic liquid crystal windows. The Liquid Crystal Windows business is now preparing for the market launch of privacy-on-demand eyrise® windows in the first quarter of 2021.
The core markets for Surface Solutions are automotive coatings, cosmetics, and, to a smaller extent, industrials. We are serving these markets with functional and decorative solutions. Our focus is on expanding our portfolio through innovation in all areas and proactive solution development in close cooperation with our customers. We provide our customers with solutions that help them to create innovative surfaces of all kinds. Our materials enable more beautiful, more resistant, and more effective products. Our pearlescent pigments allow striking automotive coatings, fascinating cosmetics, extraordinary packaging, and innovative product design. With a broad portfolio of active ingredients, we enable cosmetics manufacturers to enrich their skin care products with moisturizing, protecting, or anti-aging effects. Moreover, with our functional solutions we serve a large number of innovative applications, from dirt-repellent and easy-care surfaces to laser markings of plastic parts and cables. While Covid-19 has had significant impacts across the automotive and cosmetics markets, Surface Solutions is implementing measures to stabilize the business and to prepare for future growth.
* The contents of this chapter or section are voluntary and therefore not audited. However, our auditor has read the text critically.