AIDC — Investor Presentation 2016

Jun 2, 2016

Investor Conference

‧ ‧ ‧ Accountability Innovation Dedication Customer Orientation Aerospace Industrial Development Corporation June 8, 2016

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Contents

I. Business Status II. Competitive Advantage III. Financial Review IV. Achievements & Prospects

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I. Business Status

1. Defense Segment Business Updates (on major projects)

• －

• � New Advanced Trainer In Pursuit

Committed to giving full support to ROCAF’s acquisition of indigenously-built trainers, which is expected to greatly favor Taiwan in terms of enhancing overall industrial capabilities and sustaining pool of human resources.

－ � Military Engine In Progress

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TFE-1042 F124
Applied on IDF Applied on M346 Advanced Trainer
by Alenia Aermacchi (Italy)
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I. Business Status (cont.)

1. Defense Segment Business Updates (on major projects)

－ � IDF and F-16A/B Upgrade In Progress

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IDF Upgrade F-16A/B Upgrade
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－ � Military Aircraft MRO In Progress

UH-1H Helicopter 2nd AFLC GOCO

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Air Force Academy A/C Maintenance GOCO

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I. Business Status (cont.)

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2. Commercial Aviation Programs (on major projects)
� Popular A/C & Engines GE Aviation
Top 2 Supplier in Asia
Sikorsky S-92 Helicopter
Airbus Single-Aisle A/C A320 CFM56 GE90
Rolls-Royce
Boeing Single-Aisle A/C 737
Long-Term Supply
Chain Partner
Airbus Giant A/C A380
Boeing Dreamliner 787
TRENT 800 V2500
� NextGen A/C & Engines
CFM LEAP-X
C-Series
A320neo B737MAX
MRJ Trent XWB GEnx
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II. Competitive Advantage

1. Military Aircraft Total Lifecycle Integrated Development Capability

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PL-1 Primary T-CH-1 Basic AT-3 Advanced Jet IDF Fighter
Trainer Trainer Trainer
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(cont.) II. Competitive Advantage

2. Aircraft Structure Assembly and System Integration Capability

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(cont.) II. Competitive Advantage

3. Engine Parts Manufacturing and Testing Capabilities

Assembly / Testing Precision Machining Investment Casting

Shot Peening

Laser Drilling & Cutting Plasma Coating

5 Axis Milling Machining Precision Welding Surface Treatment

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(cont.)
II. Competitive Advantage
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4. Supply Chain and Distribution

142 Supply Chain Partners 142 Supply Chain Partners in Taiwan in Taiwan

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� 53 in central area � 37 in northern area
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2,636 Global Suppliers
Procurement
Area Proportion
Value (%)
Asia 4.3% 2.9%
Europe 8.0% 6.5%
America 26.5% 52.4%
Taiwan 61.2% 38.2%
Note. Statistics collected from 102.1.1 to
104.12.31
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� 52 in southern area

Note. Statistics collected on 105.05.31

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(cont.) II. Competitive Advantage

5. International Commercial Aviation Quality Certification & nearly 800 Special Process Certifications

In addition to ISO9001 and AS9100 certification, AIDC has been accredited by Boeing, Airbus, GE, Sikorsky, Bombardier, Bell, etc.

	Major Certification Major Certification	Milestone Milestone	Milestone Milestone
	AS9100 Rev.C	Oct.	2014
	MITAC	Dec.	2010
	QPS-100 / Bell	Jul.	2007
	RR9000 / Rolls Royce	Jun.	2007
	ASQR / Sikorsky	Dec.	2006
	MSJ-4000 / MHI	Nov.	2006
	KQMS-7100 / KHI	Sep.	2006
	QPS N.SQ-05/001 / Alenia	Feb.	2005
	QMS / Airbus UK	Mar.	2004
	BQMS Appendix A / Boeing	Dec.	2001
	S-1000 / GEAE	Sep.	2001
	QD 4.6 / Bombardier	Oct.	1999
	D1-9000 / Boeing	Dec.	1999
	Q-13-20 / NIPPI	Jun.	1996
	DQS-100 / Boeing LBD	Jan.	1995	9

III. Financial Review

1. Income Statement

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III. Financial Review (cont.)

2. Revenues

With military and commercial businesses developing in tandem, it may compensate possible risks in either sector and help to secure steady growth.

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Unit: NT$100M
Year
2011 2012 2013 2014 2015 2016 1-4
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III. Financial Review (cont.)

3. Net Income and EPS

Net Income in NT 100M Dollars

EPS in NT$/share

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Note ： 2011-2012 ROC GAAP were observed; the IFRS was adopted since 2013.

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IV. Achievements & Prospects

1. Recent Achievements

• (1) AIDC ranks 120 in “Taiwan Manufacturer Investigation 2015 ” conducted by the Commonwealth Magazine.

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• (2) Won CSR Award in the

• “Traditional Manufacturers”

category.

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(3) Established Taiwan Aerospace A-Team 4.0, integrating 220 companies.

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(cont.) IV. Achievements & Prospects

2. Current Operational Emphasis

(1) Three Major Facility Investment:

� Engine Case Manufacturing � TACC-19 Composite Plant: Center (ECMC): Inauguration Commissioning in 2016 Q2 on 2016.4.14

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(under construction)
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� F-16A/B Maintenance Han ar: Com leted in 2017 Q1 g p

~~#23 Hangar (under construction) #15A Spraying Plant (under construction)~~

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(cont.) IV. Achievements & Prospects

2. Current Operational Emphasis

－ : (2)AIDC’s strategies in the face of global competition Internally

� Implement LEAN Activity

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• Apply Balanced Scorecard

• －

• � Invest Industry 4.0 Intelligent Machine Monitoring System

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(cont.) IV. Achievements & Prospects

2. Current Operational Emphasis

－ : (2)AIDC’s strategies in the face of global competition Externally

� Industry-University Cooperation

� Strategic Alliance

• Taiwan Aviation Industry Forum

• Taiwan Aerospace A-Team 4.0

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(cont.) IV. Achievements & Prospects

3. Prospect

It is expected that the collective efforts of A-Team 4.0 could strengthen Taiwan aerospace Industry’s abilities to gain international orders, and benefit Taiwan industry as a whole.

－ － Thank you for your attention

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