Philips to acquire Lumileds

Theo van Deursen

CEO Philips Lighting 15 August 2005

Lighting Philips’ acquisition of Agilent’s shares in Lumileds • Philips acquires all shares of Agilent (47%) • Philips stake increases to 96.5% • Transaction approximately US$ 950 (Euro 765) • An important step to expand the PD Lighting business and ensures a leading position in the emerging, high growth LED market 2

Lumileds’ leadership in high power LEDs • Industry leader in high power LED’s (LUXEON platform) • JV established in 1999 • Approx 1760 employees Lighting 3

Lumileds facilities Headquarters, San Jose, California Lighting Penang, Malaysia 4

Lighting Lumileds performance Sales: EBIT: Annual Growth: Operating margin: Employees:

August 04 / July 05

US$ 324 million US$ 83 million 28% 25.6% 1760 5

Lighting The Solid State Lighting value chain Die Lumileds Single Package or Chip-on-submount Source, optics, driver and controls Philips Systems / Luminaires

End user

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Lighting The strategic relevance Philips ensures its leading position in the emerging, high growth LED market • Building on Lumileds proven expertise and leadership • Involvement in all stages of the LED business value chain • Leveraging Philips technology, manufacturing and commercial capabilities • Reaping cost synergies and additional revenues 7

Lighting LED product features • small size • long life & robust • low voltage • efficient (rapid improvements) • colors: saturation + dynamics • easily dimmable • quick response / instant start • environmental friendly: no mercury 8

High brightness packaged LEDs Revenues in $ million, ww CAGR 25% 6,000 5,000 4,000 3,000 2,000 1,000 0 Other 2003 Illumination ‘04 Signals Lighting Source: Strategies Unlimited; PennWell ‘05 Automotive ‘06 Signs/displays ‘07 2008 Mobile Appliances 9

LumiLeds is well positioned to continue it’s past (above market average) growth “ Focus on / active in the high growth market segments

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Mobile displays Automotive interior Signs Automotive exterior Mobile Flash LCD Backlighting Illumination + automotive front lighting = LumiLeds key player 10 Lighting

Lighting Philips Lighting 2004 - 2005 LED Product range Equinox Ledline 2 LEDFlood Origami Minicolour LEDAmazon iParm 11

Exploiting Solid State features and benefits…..

Light experiences & effects • Dynamic colors Embedded • Robust & long life Total Cost of Ownership reduction • Low energy & maintenance Lighting …….resulting in “increased number of light points and new applications” 12

Lighting Target applications in the professional market are decorative outdoor and shop lighting… 13

Lighting ..creating new lighting possibilities …..

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Lighting …bringing dynamic colour …..

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Lighting …..creating atmosphere in shops….

Winter Spring User interface 16

Lighting …..and ambient experiences in hospitals 17

Lighting Link öping Universtity Hospital Medical Systems and Lighting 18

Lighting Leading to profitable growth • Today’s installed luminaire base will continue to drive conventional lamp replacement • Luminaire sales will convert gradually to Solid State • Solid State creates new lighting possibilities with more initial light points per application 19

Lighting We shape the future in Solid State Lighting 20