Aurora — Earnings Release 2013

Aug 8, 2013

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Earnings Presentation for Q2, 2013

Date：Aug. 08, 2013 By Ernest Ma, Spokesperson

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Disclaimer

 This presentation and its accompanied information include operating forecast, financial condition and business projection, etc. which are predictive information gathered from company's internal and external sources.

 The operating result, financial condition and operating forecast actually created by the company in future may differ from these expressed or implied predictive information. The reasons may include, but not limit to market risk, market demand and the ability which the company can deliver high quality products, etc.

 The forecast mentioned in this presentation reflects the current belief of the company as of the date of this presentation issued. The company undertakes no obligation to remind or update the information for the change or adjustment in the future.

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Highlights of Operating Results

• ✔ NT$ 2 of EPS in the first half of 2013, 21% grew than the same period of 2012

• ✔ NT$ 5.14 billions of consolidated revenue in the first half of 2013, NT$ 1.74 billions and 34% in Taiwan, and NT$ 3.4 billions and 66% in China

✔ NT$ 610 millions of consolidated net profit in the first half of 2013, NT$ 400 millions and 66% in Taiwan, NT$ 210 million and 34% in China

Note : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Profit and loss for Q2, 2013

• ✔ Consolidated revenue reached NT$ 2.67 billions, benefited from excellent performance and steady business running

• Consolidated revenue of Q2, 2013 reached NT$ 2.67 billions, with 8% growth in QoQ but 20% declination in YoY.

  • (Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from Nov. 2012)

• If the revenue is counted on the same basis (the discrepancy caused by Aurora Telecom is eliminated), the consolidated revenue of Q2, 2013 is 8.3% growth in QoQ and 5.7% growth in YoY.

• The revenue of Q2 in China was counted NT$ 1.78 billions, with 9.8% growth in QoQ and 8.2% growth in YoY. The share in consolidated revenue is steady growing.

• ✔ Net income and EPS both hit the new records

• The net income of Q2 was NT$ 323 millions, 20% grew than the same period of last year, and EPS was NT$ 1.06, both hit the new records.

Note[1] : Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from November 2012. Note[2] : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Revenue by quarters

(百萬台幣)

(百萬台幣)
3500
1,000 1,250 1,500 1,750 2,000 2,250 2,500 2,750 3,000 3,250 ,
	Q2'11	Q3'11	Q4'11	Q1'12	Q2'12	Q3'12	Q4'12	Q1'13		Q2'13
Consolidated Rev.	3,145	3,260	3,441	3,331	3,322	3,064	2,928	2,468		2,672
YoY%	3.7%	0.7%	0.3%	6.3%	5.6%	-6.0%	-14.9%	-25.9%		-19.6%
QoQ%	0.4%	3.7%	5.5%	-3.2%	-0.3%	-7.8%	-4.4%	-15.7%		8.3%

Note[1] : Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from November 2012. Note[2] : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Revenue by quarters (counted on the same basis)

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(in million NT $)
2,800
2,700
2,600
2,500
2,400
2,300
2,200
2,100
2,000
Q2'11 Q3'11 Q4'11 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13
Consolidated Rev.(Excluded Telecom) 2,390 2,531 2,641 2,411 2,527 2,276 2,581 2,468 2,672
YoY % 4.2% 8.2% 6.0% 3.3% 5.7% -10.1% -2.3% 2.4% 5.7%
QoQ % 2.5% 5.9% 4.3% -8.7% 4.8% -10.0% 13.4% -4.4% 8.3%
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Note[1] : Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from November 2012. Note[2] : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Revenue by Region and Segment

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Q2 2013 Rev. by Region
Q2 2013 Rev. by Segment
Electronic,
33% 9%
Taiwan
China
China OA, 27%
Taiwan Furniture
, 33% Taiwan
67% Furniture
, 6%
China
OA, 25%
Q2 2012 Rev. by Segment
Q2 2012 Rev. by Region
Electronic,
Taiwan
13%
China 35% OA,
30%
China
Taiwan
Taiwan Furniture,
Furniture,
32%
65% China OA, 6%
19%
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Note[1] : Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from November 2012. Note[2] : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Revenue by Segment in Taiwan

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(in million NT$) H1 Q2
2012H1 2013H1 YoY 2012Q2 2013Q2 YoY QoQ
Total 3,458 1,742 -50% 1,679 893 -47% 5%
Office 1,456 1,431 -2% 747 740 -1% 7%
Automation
287 310 8% 136 153 13% -3%
Office Furniture
Mobile 1,715 0 -100% 795 0 -100%
Technology
(in million NT$)
H1 Q2
-Excluded Telecom
2012H1 2013H1 YoY 2012Q2 2013Q2 YoY QoQ
1,742 1,742 0% 883 893 1% 5%
Total
1,456 1,431 -2% 747 740 -1% 7%
Office Automation
287 310 8% 136 153 13% -3%
Office Furniture
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Note[1] : Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from November 2012. Note[2] : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Revenue by Segment in China

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(in million RMB) H1 Q2
2012H1 2013H1 YoY 2012Q2 2013Q2 YoY QoQ
680 709 4% 350 367 5% 8%
Total
Office 206 257 25% 107 138 29% 15%
Automation
Office 332 356 7% 171 182 6% 5%
Furniture
141 96 -32% 72 47 -34% -2%
Electronic
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Note[1] : Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from November 2012. Note[2] : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Sales Information by Quarters

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(in million NT$)
800
600
62%
400
200
3 98 %
0
Q2'12 Q3'12 Q4'12 Q1'13 Q2'13
Rev. of MIF in Taiwan Rev. of Copier Machines in Taiwan
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(in million RMB)
160
140
120
44%
100
80
60
40 56%
20
0
Q2'12 Q3'12 Q4'12 Q1'13 Q2'13
Rev. of MIF in China Rev. of Copier Machines in China
10 10
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Summary of consolidated profit and loss

(In million NT$) Net Sales Gross Profit Operating Expense Operating Income Non-op. Income (Expense) Income Before Tax Consolidated Net Income Attributable to: Minority shareholders Shareholders of Aurora Earnings Per Share (NT$) Gross Margin Operating Margin Net Margin	H1 2nd Quarter
	2012 2013 YoY 2012 2013 YoY 6,653 5,140 -23% 3,322 2,672 -20% 2,559 2,308 -10% 1,303 1,188 -9% 2,190 1,930 -12% 1,125 999 -11% 370 378 2% 178 189 6% 189 338 79% 73 189 158% 559 716 28% 251 378 51% 539 649 20% 286 343 20% 35 39 12% 17 19 15% 504 610 21% 269 323 20% 1.65 2 21% 0.89 1.06 19% 38.5% 44.9% 6.4% 39.2% 44.5% 5.3% 5.6% 7.4% 1.8% 5.3% 7.1% 1.7% 7.6% 11.9% 4.3% 8.1% 12.1% 4.0%

Note[1] : Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from November 2012. Note[2] : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Highlights on consolidated profit and loss

(in million NT$)

(in million NT$)

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3,322 3,064 2,928 2,468 2,672 263 305 263 286 323
Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13
Consolidated Net Sales Net Income Attributable to Aurora
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(NT$)
21.0%
17.1% 17.7% 17.5%
1.01 1.06 15.6%
0.89 0.88 0.94
9.2% 9.7% 10.1% 10.7% 11.0%
Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13
Earnings per share
ROA ROE
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Note[1] : Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from November 2012. Note[2] : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Summary of consolidated Balance Sheet

(in million NT$) Total Assets Current Assets Cash and short-term investments Trade and note receivables, net Inventory, net Long-Term Investments Fixed Assets, Net Total Liabilities Current Liabilities Short-term debt Trade and notes payables Long-term Liabilities Long-term debt Shareholders' Equity	2013 Q2 Q1 QoQ 12,046 11,283 7% 6,365 5,537 15% 1,504 1,161 30% 1,546 1,440 7% 925 728 27% 2,520 2,525 0% 2,685 2,735 -2% 5,641 4,157 36% 4,337 3,061 42% 1,094 1,098 0% 932 753 24% 700 500 40% 700 500 40% 6,405 7,125 -10%	2012
		Q2 YoY 11,820 2% 6,513 -2% 2,427 -38% 1,835 -16% 1,163 -20% 1,892 33% 2,800 -4% 5,890 -4% 4,725 -8% 1,239 -12% 1,224 -24% 600 17% 600 17% 5,930 8%

Note[1] : Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from November 2012. Note[2] : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Highlights on Balance Sheet

(in million NT$)

(NT$)

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21.1
12,046 19.2 19.3 19.0
11,820 [11,986 ] 17.6
11,157 [11,283 ]
Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13
Total Asset
Net Worth Per Share
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164.4% 172.2% [180.9% ]
146.8%
137.9%
Q2'12 Q3'12 Q4'12 Q1'13 Q2'13
Current ratio
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50% 47%
46%
42%
37%
Q2'12 Q3'12 Q4'12 Q1'13 Q2'13
Debt ratio
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Note[1] : Aurora Telecom was deconsolidated from Aurora and treated as an equity investment starting from November 2012. Note[2] : All Q2 2013 results provided herein were audited and approved by the board of directors.

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Policy in China – Small/micro business support

 Objective – Easing tax burden, stimulating vitality and stabilizing/expanding employment

New policy for small/micro business Plights on small/micro business Contribution from small/micro business

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Source: China Business Network

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