CMC — Investor Presentation 2018

Apr 24, 2018

CMC Operating Results and Future Plan

2018/04/24

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Safe Harbor Notice

This presentation contains forward-looking statements concerning the financial condition, results of operations and businesses of China Motor Corporation (“CMC”). All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements.

Forward-looking statements are subject to significant risks and uncertainties which may vary from time to time and actual results may differ materially from those contained in the forward-looking statements, whether as result of new information, future events, or otherwise. CMC, its subsidiaries and representatives do not undertake any obligation to the damages resulted from the use, with or without negligence, of this presentation or other information related with it, except as required by law.

Any part of this presentation can not be, on any purpose, directly or indirectly replicated, spread, transmitted or published.

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Agenda

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Market Overview in Taiwan and Mainland China
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CMC’s Operating Results in 2017
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CMC’s Performance in 2017 and Prospect in 2018
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Market Overview in Taiwan and Mainland China

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Auto Market in Taiwan

• As for 2017, the GDP growth rate increased to 2.84%, which was a record high since 2015, after the export in fourth quarter and public consumptions were better than expected. The total sales volume was 445,000 units, among which vehicles below 3.5 tons were 435,000 units and vehicles above 3.5 tons were 10,000 units.

• As for 2018, although the global economy is expected to be optimistic, there is uncertainty in the continuous growth in Taiwan’s auto market due to the trading conflicts between Mainland China and U.S.A.. The total sales volume of 2018 is estimated to be 440,000 units, among which vehicles below 3.5 tons are 430,000 units and vehicles above 3.5 tons are 10,000 units.

Unit: in ten thousand

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Auto Market in Mainland China

• As for 2017, the total sales of auto market in Mainland China were 28.9 million units which increased by 3% compared with 2016. The passenger vehicles were sold in 24.7 million units while the commercial vehicles were sold in 4.2 million units.

• As for 2018, the overall economy is expected to grow when the Chinese government releases several positive policies along with a better global economy. The estimated total sales volume of auto market in Mainland China is 30 million units which is increased by 3.9% compared with 2017.

Unit: in ten thousand

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3,000.0
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CMC’s Operating Results in 2017

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Domestic and Overseas Sales in 2017

Item	2017	2016	Growth rate(%)
Domestic Volume of Vehicles	49,222	47,094	4.5%
Market Share	11.1%	10.8%	2.8%
Overseas Volume
CBU	594	1,280	-53.6%
CKD(sets)	12,270	13,530	-9.3%
Domestic Volume of Electric Scooters	9,260	5,941	55.9%

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Operating Results in 2017 (disclosed in unconsolidated financial statements)

EPS in NTD, others in thousand NTD

ITEM	2017	2017	2016	2016	Growth rate(%)
Revenue	30,234,697	100.0%	30,577,106	100.0%	-1.1%
Operating Profit	2,064,434	6.8%	2,263,593	7.4%	-8.8%
Non-operating gain or loss	2,275,209	7.5%	1,264,507	4.1%	79.9%
Profit before tax	4,339,643	14.4%	3,528,100	11.5%	23.0%
Profit after tax	4,105,643	13.6%	3,189,100	10.4%	28.7%
Earnings per share (EPS)	3.01	-	2.34	-	28.6%

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Operating Results in 2017 (disclosed in consolidated financial statements)

EPS in NTD, others in thousand NTD	EPS in NTD, others in thousand NTD	EPS in NTD, others in thousand NTD	EPS in NTD, others in thousand NTD	EPS in NTD, others in thousand NTD	EPS in NTD, others in thousand NTD
ITEM	2017		2016		Growth rate(%)
Revenue	38,908,093	100.0%	40,584,424	100.0%	-4.1%
Operating Profit	2,434,560	6.3%	2,591,893	6.4%	-6.1%
Non-operating gain or loss	2,441,447	6.3%	1,493,659	3.7%	63.5%
Profit before tax	4,876,007	12.5%	4,085,552	10.1%	19.3%
Profit after tax	4,540,190	11.7%	3,597,372	8.9%	26.2%
Earnings per share (EPS)	3.01	-	2.34	-	28.6%

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CMC’s Performance in 2017 & Prospect in 2018

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Automotive Business in Taiwan

• In 2017, CMC launched brand new “Grand Lancer” in April. Grand Lancer had equipped with new generation chassis, 4J engine, Continuously Variable Transmission(CVT8) and Mitsubishi Dynamic Suspension System(MDSS). CMC also launched modified model of Colt Plus in June and imported a crossover SUV “Eclipse Cross” in December. The total CMC’s sales reached 49,000 units in 2017, including Fuso-branded vehicles, due to the encouragement of the policy of replacement of old vehicles with new ones.

• In 2018, CMC continues launching special editions for existing vehicle models and improving our sales and after-sales systems. We also plan to launch modified models of Outlander and Veryca in fourth quarter. The total CMC’s sales are estimated to be 50,000 units in 2018, including Fusobranded vehicles, while the policy of replacement of old vehicles with new ones is still in effect.

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Colt Plus/Grand Lancer/Zinger Veryca Outlander
Colt Plus
Grand Lancer
special editions & big modified modified
modified model
system improvement model model
2017 2018
Eclipse Cross Pajero 2018 model
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Domestic
Imported
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Automotive Business in Mainland China

 In 2017, with strengthened sales of DX7 and DX3 and introducing several models with superior product competitiveness and special editions, SEM’s sales were 155,000 vehicles, which were 30% higher than 2016. In 2018, in addition to the launch of DX7 modified model and DX3 2018 model to stimulate strong buying of DX7 and DX3, SEM also plans to launch A-Class Sedan “A5” and DX3 electrical vehicle. SEM’s sales are estimated to be 165,000 vehicles in 2018, which will be a new record high.

DX7 and DX3 new model year, DX3 special sport-edition and several modified models with superior product competitiveness and special editions.

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A-Class SUV DX7 A0-Class SUV DX3 A-Class Sedan A5 Modified Model 2018 Model Year/EV (V5 Modified Model)

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2017 2018
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 Benefiting from strong sales of VS20, which offered several exterior color choices and promotions to customers, FBAC’s total sales in 2017 were 22,000 units. In 2018, FBAC continues several promotional campaigns to achieve the sales goal of 30,000 vehicles, which are over 30% more than the sales of 2017.

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Automotive Business in Overseas Markets

 As for vehicle export, due to the tightened safety regulations in GCC executed in 2017, it caused Veryca, Zinger and Lancer Fortis not able to timely meet all requirements. The export volume was 594 units in 2017. In 2018, CMC’s export is conservatively estimated to be 400~500 units because of existing unfavorable factors and new model year products to be launched by the competitors in the Middle East.

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CBU Exports
Veryca Zinger Lancer Fortis
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 As for CKD export, CMC exported 12,000 sets in 2017, mainly affected by Freeca unable to meet European Union (Stage IV) emission standards executed in Philippines and SEM’s reconciled inventory. In 2018, the export is estimated to decline to 600 sets, mainly due to discontinued production of Freeca in Philippines and Lancer in SEM.

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Green Energy Business

• In 2017, CMC’s sales were 9,260 units, including e-scooters, which were over 50% more than 2016. This increase was because of improved brand preference on Greentrans/e-moving through implementing cross-industry alliance, promotions to enterprises, public authorities and schools (such as green school project), setting up different specialty stores, such as flagship stores, to deeply communicate with customers and launching “e-moving Shine” in early November.

• In 2018, in addition to the promotional campaigns and activities executed in 2017, CMC also plans to provide enterprises with beneficial buying or rental options, to enhance the development of domestic specialty stores and free charging stations in schools and to introduce special editions of current e-scooters, such as “e-moving Shine” with new colors. CMC’s e-scooter sales are estimated to be 12,000 units in 2018.

Electric scooter Electric scooter Electric scooter free Electric scooter Electric scooter featured by big body featured as general of license plate featured by featured by high performance for both public and heavy-duty economic convenience & long endurance private uses Commercial uses

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emoving POST

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Thank you for your listening

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