CEC — Investor Presentation 2018

Oct 30, 2018

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Investor Conference Nov. 1[st] 2018

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http://www.ecotek.com.tw/cec_csr/index.php
創造對環境友善、讓客戶信賴的全方位工程公司

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Content

Company Introduction
Operation Overview
Financial Highlight
Future Prospect

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Company Introduction: Profile

Paid-in Capital	NTD 1.23B
Market Cap	NTD 4.33B
Major Business	Environmental Engineering M&E Engineering O&M Engineering
Number of Employee	1180(Admin. 7%, Design 12%, Construction 28%, O&M 53%)
Company Location	HQ and Technical Center in Kaohsiung City. Oversea subsidiary company in Vietnam & China

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Company Introduction: Profile

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M&E, Plant Environmental Protection Operation &
Engineering & Energy Maintenance
O&M
Water Treatment
Steel Plant
•
• advanced water water purification plant
& waste water plant
purification
•
• steel plant
Aluminum sewage & waste water treatment and reclamation • incineration plant
Plant • industrial water
•
chemical dosing for waste
Biotech & treatment
Pharmaceutical Mechanical O&M
Plant
•
Air Pollution Control heavy rotary
equipment
Synthetic • de-dust • refractory
Fiber Mill • de-Nox, de-SOX, de-Dioxin maintenance
•
System turnkey maintenance
• deodorization
Industrial
Plant Electrical
Incineration Plant
Maintenance
•
Power system
Energy •
Panel control system
•
power plant & co-
generation plant
•
PV plant Major Repair &
• LED Periodical Repair
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Operation Overview

Environmental
PV

M&E
Protection

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Refractory Biotech
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Oversea
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M&E Engineering

  - `Stable profit earned from group company, e.g., CSC or DSC equipment revamping, site maintenance and O&M, etc.`

  - `Start with the Group and expand outside the Group, we promote turnkey construction for M&E equipment so revenue and profit will increase.`

• 2018 major on-going projects

• CSC Revamping Project of No. 2 Blast Furnace 3rd Campaign

• CSC Retrofit Project of Conveying Coal/Iron Ore

• CSC RMTP Operation and Maintenance work

• CSC IWI Operation and Maintenance work

• CSC W1 stage 2 Improvement of stone-crushing system

• DSC Retrofit Project of Conveying – RM Storage Yard for wind & dust protection enhancement

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M&E Engineering

CSC Production Line – M&E Engineering

CSC Recycling Plant O&M

CSC Residual Materials
Pretreatment Plant

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• Develop the engineering market about recycling and re-using city waste water (reclaimed water). Continuously develop project of waste water treatment, water purification and O&M.

• Upgrade air pollution technique of de-NOX, de-SOX and dust collection. Expand the operation area.

• 2018 major on-going projects

• Cheng-Ching Lake Advanced Water Treatment Plant O&M

• Kinmen county, Tai-hu Advanced Water Treatment Plant O&M

• New Taipei City, Sanxia Yingge Water Resources Plant Project

• Kaohsiung City, Kangshan Qiaotou Sewage Treatment Plant Project

• Water Transmission Pipeline Project (from Jin-jiang River, China to Kinmen county)

• CSC Main Transmission Pipeline and Domestic Water Distribution (from Feng-shan stream Wastewater Reclamation Plant)

• Revamping Dust-collecting System for Xin-dian Refuse Incineration Plant and Shu-lin Refuse Incineration Plant

• CSC #2 Indoor Scrap Yard Expansion Project for Dust-collecting

• CSCC Ping-nan Plant SCR project

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Waste Water Treatment
De-minimal System

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Water
Treatment

SCR
Air Pollution Control
Dust
Collection

FGD

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PV Engineering

• Corporate strategy taken between CSC PV Co. and CEC in completing the project of CSC Group 80MWp PV plant installation.

• Mid-to-long term target inside the Group extending to outside the Group, CEC continuously pushes for site turnkey project.

 2018 major on-going projects

• CSC #3 Cold Rolling Mill Plant PV Construction Project.

• CSC Lin-hai Plant PV Construction Project

• CSAC L6/L7 Plant PV Construction Project

• DSC Center Shop PV Construction Project

• CSMC Main Plant and Fong-bi-tou Plant PV Construction Project

• CHS Lu-kang Plant PV Construction Project

• CSSC Yan-chao Plant PV Construction Project

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PV Engineering

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Refractory Engineering

  - `By projects of refractory maintenance, we can gain the first-hand/latest information about new-built project and enhance the client’s trust to CEC.`

  - `Strengthen the professionals’ technique, searching  for sources of global refractory materials and expanding business about refractory turnkey construction.`

• 2018 major on-going projects

• CSC Revamp #3 BFR Refractory Project

• CSC Revamp #3/#4 Hot Stove Refractory Project

• CSC Revamp Y41#2 Heating Furnace

• DSC Refractory Maintenance—Steel-making area

• DSC Repair #21 Hot Stove Connection Pipe

• CSCC Graphitizing furnace - refractory turnkey project

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Refractory Engineering

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Lime Burner

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Hot Stove

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Hot Stove Pipeline

Blast Furnace

Heating Furnace

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Coke Oven

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Biotech & Pharmaceutical

• Biotech construction of whole plant provides complete service for (1) design (2) commissioning (3) liability test, etc.

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建築
、內裝
空調及
潔淨管線
通風
廠設工程
公用流 電力
體系統 弱電
給排水及
消防
廢水處理
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• 2018 major on-going projects

Manufacturing Plant

Cailway Biopharmaceuticals Co.Ltd

Mackay Memorial Hospital

• Formosa Laboratories, Inc.

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Biotech & Pharmaceutical

EirGenix (台康生技) Medigen(高端疫苗)

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Taimed (中裕)

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Scino(神隆針劑)

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Oversea

• Expand business base to Vietnam, in response to governmental New Southbound Policy.

• Actively exploit EPC project of water treatment and pollution control for local steel plant and PET plant.

• 2018 major on-going projects

• CSVC M&E Maintenance

• FHS Coke Making Plant M&E Maintenance

• FHS Coke Making Plant Refractory Maintenance

• FHS #1/#2 Sinter Plant FGD,SCR System Project

• • FET(VN) 400,000 tons PET Plant Construction Project

• • Tung-ho Steel Co.(VN) Rolling Mill Plant M&E Construction and Utility Project

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Tung Ho
Steel M&E
Project

Oversea

FHS M&E Project

FET(VN) PET Plant Project

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Financial Highlight: Construction contracts were signed but not yet recorded

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Unit: NT$, Thousand
15,000,000
14,138,430
12,760,963
10,785,904 10,807,660 [ 11,022,658 ]
10,239,563
30th,June,2018
10,000,000
Oversea
27%
5,000,000
Taiwan
73%
0
2013 2014 2015 2016 2017 30th,June,2018
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Others Others
0.01% 3%
Environmental
Vietnam
Protection
Operation and
24.90%
Maintenance Engineering
24%
Taiwan 25%
75.09%
M&E Engineering
48%
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 District：Taiwan75.09%，Vietnam 24.9%    Category：
                                               M&E Engineering 48%,

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Operation and Maintenance25%， 12,000,000 Unit: NT$, Thousand
9,971,393
10,000,000
8,474,982
8,000,000 7,597,194
6,000,000
82% 81%
4,000,000
75%
2,000,000
-
105 106 107Q3
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Taiwan Oversea
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1[st] Half of 2018 Consolidated Income Statement

Unit: NT$, Thousand

	2018/06/30	2018/06/30	2018/06/30	2017/06/30	2017/06/30	2017/06/30		YOY
Sales Revenues	5,021,394 100%			3,939,986 100% 27%
Operating costs	4,732,610		95%	3,610,996		91%		31%
Gross Profit	278,054 5%			328,825 9% -15%
Operating expenses	213,090		4%	192,223		5%		11%
Operating income	64,964 1%			136,602 4% -52%
Total non-operating income and expenses	17,391		1%	(63,671)		-2%		-127%
Profit before income tax	82,355 2%			72,931 2% 13%
Income tax expense	36,592		1%	21,304		1%		72%
Profit for the period	45,763 1%			51,627 1% -11%
Total basic earnings per share	0.37			0.42

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	Unit: NT$, Thousand	Unit: NT$, Thousand	Unit: NT$, Thousand	Unit: NT$, Thousand	Unit: NT$, Thousand	Unit: NT$, Thousand	Unit: NT$, Thousand
	2018/06/30				2017/06/30
Current assets	6,237,259 83% 5,965,465 84%
Non-current assets	1,234,022		17%		1,138,214		16%
Total assets	7,471,281 100% 7,103,679 100%
Current liabilities＊	4,007,196		54%		3,696,765		52%
Non-current liabilities	481,180 6% 454,611 6%
Total Liabilities	4,488,376		60%		4,151,376		58%
Total equity	2,982,905 40% 2,952,303 42%
Total liabilities and equity	7,471,281		100%		7,103,679		100%

*“Contract liabilities-current”NT$1.62B

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Dividend Payout

Unit: NT$

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6.00 100
5.51
90 90
5.06
4.90
5.00 4.84 83
82
80 80
4.44 4.50
71 73 72 71 3.89 69 4.11 73 70
4.00
3.71
3.50 3.50
60
59
3.39
3.20
3.00
3.00 50
2.70
2.55
40
2.00 2.00
2.00 1.80 1.80
30
1.51
1.25
20
1.00
10
- 0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
EPS Cash DPS Cash Dividend Payout Ratio(%)
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Future Prospect

1. New Field Exploitation: On basis of current M&E, environmental engineering, rebuild internal procedure to reduce cost and to advance core technologies. At the same time, form strategic alliances and cooperate with the government to promote policy of “energy saving & carbon reduction” and circular economy.

2. Operation & Maintenance: Boost up the M&E and Refractory by business mode of combining construction procurement with labor, within the Group and outside the Group, in order to increase company’s revenue and profit.

3. Resources Integration: Upgrade company competitive by new business mode of participating in projects of development, production and integration, in the field of reclaimed water, green energy and refractory.

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Business Profit Potential

1. Revamping Project of CSC No.2 Blast Furnace 3[rd] Campaign (6.36B) 2. Revamping #1 Power Plant(MB, TG-9,TG-10) (10B)

3.Taiwan has 19 Refuse Incineration Plants which are built over 15 years. 3 of 19
plants have awarded bids in revamping; the rest of 16 plants will also keep up
one after another. (15.342B)

4. Effluent Recycling Project of Public Sewage Treatment (pending bid for vender): Project of Fu-tian Reclaimed Water Treatment (130k ton/per day, 9.3B), Project

of An-pin Reclaimed Water Treatment (30k ton/per day, 3.62B), Project of Sui-nan Reclaimed Water Treatment (10k ton/per day, 0.77B)  total: 13.69B 5. In 2020, Taiwan Environmental Protection Admin. will tighten the standard about air pollutants, in order to improve the pollution from current Coal-fired boiler & heavy-oil burner. EX: particular pollutant (30mg/Nm3), SOx(50ppm)、NOx(100ppm) It means over half of 15 thousand boilers in Taiwan needs revamping.  over 30B potential profits

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Thank You for Listening Your Comments are welcome

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