ABILITY — Investor Presentation 2018

Dec 28, 2018

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ABILITY ENTERPRISE CO., LTD
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Ability Enterprise Investor Conference

2018

Dec. 28, 2018

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ABILITY ENTERPRISE CO., LTD
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Agenda

2018 Q3 Financial Result

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• EMS Pro Forma

Outlook Q&A

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ABILITY ENTERPRISE CO., LTD
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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$)	Unit：NT$ in millions (except EPS in NT$)
	Jan~Se	p '2018	Jan~Sep '2017		YOY
	Amt	%	Amt	%	Amt
Net Sales	5,021	100.0	8,024	100.0	(3,003)
COGS	4,743	94.5	7,049	87.8	(2,306)
Gross Margin	278	5.5	975	12.2	(697)
OP Exp	842	16.8	847	10.6	(5)
OP Income (Loss)	(564)	(11.3)	128	1.6	(692)
Net Non-OP	165	3.3	120	1.5	45
PBT	(399)	(8.0)	248	3.1	(647)
Tax	(43)	(0.9)	31	0.4	(74)
Net Income (Loss)	(356)	(7.1)	217	2.7	(573)
After-Tax EPS	(1.26)		0.77		(2.03)

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ABILITY ENTERPRISE CO., LTD
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Con. Non-OP Items- YOY EMS Pro Forma

ABILITY ENTERPRISE CO., LTD Con. Non-OP Items- YOY EMS P F	ABILITY ENTERPRISE CO., LTD Con. Non-OP Items- YOY EMS P F	ABILITY ENTERPRISE CO., LTD Con. Non-OP Items- YOY EMS P F	ABILITY ENTERPRISE CO., LTD Con. Non-OP Items- YOY EMS P F	ABILITY ENTERPRISE CO., LTD Con. Non-OP Items- YOY EMS P F	ABILITY ENTERPRISE CO., LTD Con. Non-OP Items- YOY EMS P F	ABILITY ENTERPRISE CO., LTD Con. Non-OP Items- YOY EMS P F
ro orma Unit：NT$ in millions
	Jan~Sep'2018		Jan~Sep'2017		YOY
	Amt	%	Amt	%	Amt	%
• Interest income	21	0.4	14 (16) 82 - (36) 23	0.2	7	50.0%
• Investment income (Loss) accounted for under the equity method	14	0.3		(0.2)	30	187.5%
• Dividend income	88	1.8		1.0	6	7.3%
• Gain on disposal of property, plant and equipment	56	1.1		-	56
• Gain (Loss) on Exchange	15 24 7	0.3		(0.4)	51	141.7%
• Rental income		0.5		0.3	1	4.3%
• Other income		0.1	61	0.8	(54)	-87.8%
Total non-operating income	225	4.5	128	1.6	97	76.1%
• Impairment loss	(52)	(1.0)	-	-	(52)
• Other expenses	(8)	(0.2)	(8)	(0.1)	0	0.0%
Total non-operating expenses	(60)	(1.2)	(8)	(0.1)	(52)	-650.0%
					0
Net Non-Operating	165	3.3	120	1.5	45	37.9%

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ABILITY ENTERPRISE CO., LTD
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Financial Highlights EMS Pro Forma

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Consolidated Net Sales : -37.4% on YOY ： Consolidated Gross Margin .5.5%, down 6.7% on YOY Material cost increased by 2.1% due to component price increase After Tax EPS: ($1.26)

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Consolidated BS-EMS Pro Forma

Unit ： NT$ in millions

	2018/9/30	2018/9/30	2017/12/31	2017/12/31
	Amt	%	Amt	%	Diff	Diff %
Total Current Assets	5,062 2,322 808 1,252 983 3,426	49.2	6,207 2,709 1,482 1,407 1,206 3,801	51.7	(1,145)	-18.4%
• Cash & cash equivalents, short- term investment		22.6		22.6	(387)	-14.3%
• Notes & accounts receivable		7.9		12.3	(674)	-45.5%
• Inventories		12.2		11.7	(155)	-11.0%
Fund & long-term Investments		9.6		10.0	(223)	-18.5%
Property , Plant & Equipment		33.3		31.6	(375)	-9.9%
Total Assets	10,291	100.0	12,012	100.0	(1,721)	-14.3%
Total Current Liabilities	2,803 1,640 553 67	27.2	3,427 2,159 822 68	28.5	(624)	-18.2%
• Notes & accounts payable		15.9		18.0	(519)	-24.0%
• Other payables		5.4		6.8	(269)	-32.7%
Non-current liabilities		0.7		0.6	(1)	-1.5%
Total Liabilities	2,870	27.9	3,495	29.1	(625)	-17.9%
• Common Stock	2,824 1,563 1,656 1,753 (375)	27.4	2,824 1,563 1,735 2,254 133	23.5	0	0.0%
• Capital Reserve		15.2		13.0	0	0.0%
• Legal Reserve		16.1		14.4	(79)	-4.6%
• Retained Earnings		17.0		18.8	(501)	-22.2%
• Other Equity		(3.6)		1.1	(508)	-382.0%
Total Stockholders' Equity	7,421	72.1	8,509	70.8	(1,088)	-12.8%
Net Worth / Share (NT$)	26.28		30.13		(3.85)	-12.8%

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ABILITY ENTERPRISE CO., LTD
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2018.09.30 B/S Highlights-EMS Pro Forma

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Debt ratio 28% with 57% payables; 19% accrued exp Current Ratio is 181% AP Payment days: 110 days AR Collection days: 62 days Inventory turnover days: 77 days Cash conversion cycle is -29 days

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ABILITY ENTERPRISE CO., LTD
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Consolidated IS

Consolidated IS	Consolidated IS	Consolidated IS	Consolidated IS	Consolidated IS	Consolidated IS	Consolidated IS
Unit：NT$ in millions (except EPS in NT$)
	Jan~Sep'2018		Jan~Sep'2017		YOY
	Amt	%	Amt	%	Amt	%
Net Sales	5,747	100.0	8,614	100.0	(2,867)	-33.3%
COGS	5,246	91.3	7,488	86.9	(2,242)	-29.9%
Gross Margin	501	8.7	1,126	13.1	(625)	-55.5%
OP Exp	1,021	17.8	992	11.5	30	3.0%
OP Income (Loss)	(521)	(9.1)	134	1.6	(655)	-488.5%
Net Non-OP	166	2.8	118	1.4	48	40.8%
PBT	(355)	(6.3)	252	3.0	(607)	-241.0%
Tax	(28)	(0.5)	39	0.4	(67)	-173.2%
Cons. Net Income (Loss)	(327)	(5.8)	213	2.6	(540)	-253.3%
Minority interest	30	0.5	(4)	(0.0)	34	868.7%
Net Income (Loss) (After-mi )	(356)	(6.3)	217	2.6	(573)	-264.3%
After-Tax EPS					0
	(1.26)		0.77		(2.03)	-263.6%

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ABILITY ENTERPRISE CO., LTD	ABILITY ENTERPRISE CO., LTD	ABILITY ENTERPRISE CO., LTD	ABILITY ENTERPRISE CO., LTD	ABILITY ENTERPRISE CO., LTD	ABILITY ENTERPRISE CO., LTD	ABILITY ENTERPRISE CO., LTD
Unit：NT$ in millions Clidtd BS
onsoae	2018/9/30		2017/12/31
	Amt	%	Amt	%	Diff	diff %
Total Current Assets	5,699 2,505 1,109 1,387 759 3,614	51.5	6,860	53.6	(1,161)	-16.9%
• Cash & cash equivalents, short- term investment		22.6	3,012	23.5	(507)	-16.8%
• Notes & accounts receivable		10.0	1,704	13.3	(595)	-34.9%
• Inventories		12.5	1,501	11.7	(114)	-7.6%
Fund & long-term Investments		6.9	1,148	9.0	(389)	-33.9%
Property , Plant & Equipment		32.6	3,990	31.2	(376)	-9.4%
Total Assets	11,072	100.0	12,806	100.0	(1,734)	-13.5%
Total Current Liabilities	3,356 401 1,744 664 83	30.3	4,017	31.4	(661)	-16.5%
• Short-term bank loans		3.6	340	2.7	61	17.9%
• Notes & accounts payable		15.8	2,330	18.2	(586)	-25.2%
• Other payables		6.0	871	6.8	(207)	-23.8%
Non-current liabilities		0.7	83	0.6	0	0.0%
Total Liabilities	3,438	31.1	4,100	32.0	(662)	-16.1%
• Common Stock	2,824 1,563 1,656 1,754 (375)	25.5	2,824	22.1	0	0.0%
• Capital Reserve		14.1	1,563	12.2	0	0.0%
• Legal Reserve		15.0	1,735	13.5	(79)	-4.6%
• Retained Earnings		15.8	2,254	17.6	(500)	-22.2%
• Other Equity		(3.4)	133	1.0	(508)	-382.0%
Total equity attributable to owners of parent	7,421	67.0	8,509	66.4	(1,088)	-12.8%
Net Worth / Share (NT$)	26.28		30.13		(3.85)

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ABILITY ENTERPRISE CO., LTD
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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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ABILITY ENTERPRISE CO., LTD
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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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