ABILITY — Investor Presentation 2017

Dec 28, 2017

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ABILITY ENTERPRISE CO., LTD
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Ability Enterprise Investor Conference 2017 December

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December, 28[th] , 2017

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ABILITY ENTERPRISE CO., LTD
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Agenda

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2017 Q3 Financial Result

• EMS Pro Forma

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Outlook Q&A

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Consolidated IS EMS Pro Forma

			Unit：NT$ in millions (except EPS in NT$)	Unit：NT$ in millions (except EPS in NT$)	Unit：NT$ in millions (except EPS in NT$)	Unit：NT$ in millions (except EPS in NT$)
	Jan~Sep	'2017	Jan~Sep	'2016	YOY
	Amt	%	Amt	%	%
Net Sales	8,024	100.0	7,273	100.0	10.3%
COGS	7,049	87.8	6,402	88.0	10.1%
Gross Margin	975	12.15	871	11.98	11.9%
OP Exp	847	10.6	926	12.7	-8.5%
OP Income	128	1.6	(55)	(0.7)	332.7%
Net Non-OP	120	1.5	344	4.7	-65.1%
PBT	248	3.1	289	4.0	-14.2%
Tax	31	0.4	39	0.5	-20.5%
Net Income	217	2.7	250	3.5	-13.2%
After-Tax EPS	0.77		0.90		-14.4%

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Con. Non-OP Items- YOY EMS Pro Forma

ABILITY ENTERPRISE CO., LTD Con. Non-OP Items- YOY EMS Pro Forma
		Unit：NT$ in millions
	Jan~Sep	'2017	Jan~Sep '2016
	Amt	%	Amt	%
Interest income	14	0.2	18	0.2
Investment income accounted for under the equity
method	(16)	(0.2)	32	0.4
Dividend income	82	1.0	95	1.3
Gain on disposal of investments	2	0.0	0	0.0
Rental income	23	0.3	23	0.3
Other income	59	0.7	199	2.8
Total non-operating income	164	2.0	367	5.0
Loss on Exchange	(36)	(0.4)	(9)	(0.1)
Loss on valuation of financial assets	0	0.0	(1)	(0.0)
Other expenses	(8)	(0.1)	(13)	(0.2)
Total non-operating expenses	(44)	(0.5)	(23)	(0.3)
Net Non-Operating	120	1.5	344	4.7
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Q3 Financial Highlights EMS Pro Forma

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Consolidated Net Sales : -12.2% on QOQ ； 10.3% on Q3 YOY ： Q1:10.8% ； Q2:12.85% ； Q3:12.74% Consolidated Gross Margin Q3 vs Q2 ASP Flat & Material cost continuously improved Consolidated OP Income: Q1~Q3 YOY is 332.7% ； Q3 YOY is 226.8% 、 QOQ is -28.8% Consolidated Net income: Q1~Q3 YOY is -13.2% ； Q3 YOY is -42.5% 、 QOQ is 89.8% After Tax EPS: $0.77

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ABILITY ENTERPRISE CO., LTD
Consolidated	BS-EMS	Pro Forma
			Unit：NT$ in millions
	2017/9/30		2017/6/30
	Amt	%	Amt	%	QOQ
Total Current Assets	6,482	53.6	6,851	55.7	-5.4%
Cash & cash equivalents,
short-term investment	2,995	24.8	3,413	27.7	-12.2%
Notes & accounts receivable	1,552	12.8	1,610	13.1	-3.6%
Inventories	1,240	10.2	1,198	9.7	3.5%
Fund & long-term Investments	952	7.9	970	7.9	-1.9%
Property , Plant & Equipment	3,875	32.0	3,707	30.1	4.5%
Total Assets	12,101	100.0	12,306	100.0	-1.7%
Total Current Liabilities	3,674	30.4	4,074	33.1	-9.8%
Notes & accounts payable	2,368	19.6	2,476	20.1	-4.4%
Other payables	812	6.7	964	7.8	-15.8%
Non-current liabilities	95	0.8	73	0.6	30.1%
Total Liabilities	3,747	31.0	4,147	33.7	-9.6%
Common Stock	2,824	23.3	2,824	22.9	0.0%
Capital Reserve	1,563	12.9	1,562	12.7	0.1%
Legal Reserve	1,634	13.5	1,634	13.3	0.0%
Retained Earnings	2,239	18.5	2,107	17.1	6.3%
Total Stockholders' Equity	8,354	69.0	8,159	66.3	2.4%
Net Worth / Share (NT$)	29.58		28.89		2.4%
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2017.09.30 B/S Highlights-EMS Pro Forma

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Debt ratio 31% with 63% payables; 22% accrued exp Current Ratio is 176% AP Payment days: 95 days AR Collection days: 53 days Inventory turnover days: 51 days Cash conversion cycle is -9 days

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ABILITY ENTERPRISE CO., LTD	ABILITY ENTERPRISE CO., LTD
Consolidated IS
		Unit：NT$ in millions (except EPS in NT$)
	Jan~Sep '2017		Jan~Sep '2016		YOY
	Amt	%	Amt	%	%
Net Sales	8,614	100.0	7,982	100.0	7.9%
COGS	7,488	86.9	6,878	86.2	8.9%
Gross Margin	1,126	13.07	1,104	13.83	2.0%
OP Exp	992	11.5	1,090	13.7	-9.0%
OP Income	134	1.6	14	0.1	857.1%
Net Non-OP	118	1.4	317	4.0	-62.8%
PBT	252	3.0	331	4.1	-23.9%
Tax	39	0.5	42	0.5	-7.1%
Cons. Net Income	213	2.5	289	3.6	-26.3%
Minority interest	(4)	(0.0)	39	0.5	-110.3%
Net Income
(After-mi )	217	2.5	250	3.1	-13.2%
After-Tax EPS	0.77		0.90		-14.4%
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Consolidated BS

Unit ： NT$ in millions

Amt	%
Total Current Assets 7,129 Cash & cash equivalents, short-term investment 3,301 Notes & accounts receivable 1,761 Inventories 1,332 Fund & long-term Investments 865 Property , Plant & Equipment 4,062	55.4
	25.6
	13.7
	10.3
	6.7
	31.5
Total Assets 12,879	100.0
Total Current Liabilities 4,241 Short-term bank loans 326 Notes & accounts payable 2,486 Other payables 899 Non-current liabilities 92	32.9
	2.5
	19.3
	7.0
	0.7
Total Liabilities 4,333	33.6
Common Stock 2,824 Capital Reserve 1,563 Legal Reserve 1,634 Retained Earnings 2,239	21.9
	12.1
	12.7
	17.4
Total equity attributable to owners of parent 8,354	64.9
Net Worth / Share (NT$) 29.58

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Q&A Thank You

Ability Enterprise Co., LTD. Tel : +886 (2) 8522-9788 / Fax : +886 (2) 8522-9789 http://www.abilitycorp.com.tw

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Safe Harbor Notice

We have made forward-looking statements in the presentation. Our forward-looking statements contain information regarding, among other things, our financial conditions, future expansion plans and business strategies. We have based these forward-looking statements on our current expectations and projections about future events. Although we believe that these expectations and projections are reasonable, such forward-looking statements are inherently subject to risks, uncertainties, and assumptions about us.

We undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events in the conference might not occur and our actual results could differ materially from those anticipated in these forward-looking statements.

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