Update on Thinfilm’s Roll-to-Roll Manufacturing Initiative

Thin Film Electronics ASA (“Thinfilm”) today announced that, as of the end of March 2018, all roll-to-roll process equipment for the manufacturing of Electronic Article Surveillance (EAS) tags was on-site and in the final stage of installation at the Company’s US headquarters and manufacturing center in San Jose, California. Process qualification of EAS-related manufacturing is nearing completion. EAS dies with two of five layers roll-processed meet electrical specifications with higher-than-expected engineering yields.

Demand for Thinfilm EAS tags is expected to increase significantly later this year as Thinfilm’s EAS product is now qualified for use in new clothing categories, including denims. Preliminary deliveries of EAS tags for this product category were made as a result of sheet-based manufacturing earlier in 2018.

As communicated previously, the Company has embarked on a capital investment program to establish a roll-based manufacturing line for the production of Near Field Communication (NFC) tags using Thinfilm’s proprietary Printed-Dopant Polysilicon (PDPS) technology. The NFC manufacturing process uses the same toolset as EAS, but requires six additional process steps. The additional unit operations to support these steps are to be installed over the next several months. The start of NFC die manufacturing is on-track and scheduled to commence by end of Q3 2018.

Based on testing completed by multiple independent ecosystem partners, Thinfilm’s flexible, ultra-thin PDPS NFC dies withstand up to 10-times higher compressive force than conventional silicon NFC dies. This durability makes PDPS especially suitable for packaging and bottling lines that use driver wheels, pinch rollers, and gripping equipment. Recently, several runs on various industry-standard production lines all resulted in 100% yield with no loss of performance when using PDPS-based NFC inlays. Conventional silicon-die based tags appear to require line modifications or thick protective layers because of the intrinsic brittleness and stiffness of bulk silicon, with yield losses as high as 15% reported. In addition, PDPS can withstand an order-of-magnitude more impact energy than conventional dies, which prevents in-field failure resulting from on-shelf, bottle-to-bottle impact.

Together with its CNECT cloud-based software platform, Thinfilm offers complete NFC mobile marketing solutions to leading global brands. The Company’s customers include leaders in fast-moving consumer goods, health and wellness, cosmetics, over-the-counter pharmaceuticals, wine & spirits, craft beer, apparel, collectibles, and luxury accessories.

 

April 10, 2018
Thin Film Electronics ASA

For more information, contact:
Bill Cummings, SVP Corporate Communications: +1 408-503-7312 / bill.cummings@thinfilm.no

This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.