ELAN — Interim / Quarterly Report 2018

Oct 30, 2018

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ELAN Microelectronics Corp.

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ELAN Microelectronics Corp.

3Q18 Investor Conference

2018/10/30

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ELAN Microelectronics Corp.

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Sales Breakdown by Product Line (Consolidated)

Sales: NT$M 6,559 7,503 1,589 1,867 2,160 1,887 1,779 2,104 2,484

• Touch: Touchscreen Controller, Touchpad, Biometrics • Non-Touch: MCU, Pointing Stick, Affiliated Co. Products

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ELAN Microelectronics Corp.

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3Q18 Income Statement YoY Comparison (Consolidated)

3Q18 Income Statement YoY Comparison (Consolidated)	3Q18 Income Statement YoY Comparison (Consolidated)	3Q18 Income Statement YoY Comparison (Consolidated)	3Q18 Income Statement YoY Comparison (Consolidated)	3Q18 Income Statement YoY Comparison (Consolidated)	3Q18 Income Statement YoY Comparison (Consolidated)
NT$M
	3Q18	%	3Q17	%	YoY(%)
Sales	2,484	100.0	2,160	100.0	15.0
Gross profit	1,146	46.1	994	46.0	15.3
Sales expense	97	3.9	85	3.9
G&A expense	86	3.5	80	3.7
R&D expense	396	15.9	361	16.7
Operating profit	567	22.8	468	21.7	21.2
Non-operating income & exp.	24	1.0	11	0.5
Profit before tax	591	23.8	479	22.2	23.4
Net profit	472	19.0	390	18.1	21.0
Belong
Parent company	480		400
Non-Controlling Interests	(8)		(10)
*** EPS (NT$)**	1.28		0.96		33.3

*** 3Q18 and 3Q17 based on the 304 million shares and 434 million shares respectively (Unreviewed)**

*** The record date of capital reduction was at the end of Aug. 2018.**

*** Based on the weighted average number of shares outstanding**

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ELAN Microelectronics Corp.

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3Q18 Income Statement QoQ Comparison (Consolidated)

3Q18 Income Statement QoQ Comparison (Consolidated)	3Q18 Income Statement QoQ Comparison (Consolidated)	3Q18 Income Statement QoQ Comparison (Consolidated)	3Q18 Income Statement QoQ Comparison (Consolidated)	3Q18 Income Statement QoQ Comparison (Consolidated)	3Q18 Income Statement QoQ Comparison (Consolidated)
NT$M
	3Q18	%	2Q18	%	QoQ(%)
Sales	2,484	100.0	2,104	100.0	18.1
Gross profit	1,146	46.1	948	45.1	20.9
Sales expense	97	3.9	103	4.9
G&A expense	86	3.5	82	3.9
R&D expense	396	15.9	376	17.9
Operating profit	567	22.8	387	18.4	46.5
Non-operating income & exp.	24	1.0	74	3.5
Profit before tax	591	23.8	461	21.9	28.2
Net profit	472	19.0	365	17.3	29.3
Belong
Parent company	480		376
Non-Controlling Interests	(8)		(11)
*** EPS (NT$)**	1.28		0.91		40.7

*** 3Q18 and 3Q17 based on the 304 million shares and 434 million shares respectively (Unreviewed)**

• The record date of capital reduction was at the end of Aug. 2018.

• Based on the weighted average number of shares outstanding

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ELAN Microelectronics Corp.

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1Q18~3Q18 Income Statement YoY Comparison (Consolidated)

NT$M

	1Q18~3Q18	%	1Q17~3Q17	%	YoY(%)
Sales	6,367	100.0	5,616	100.0	13.4
Gross profit	2,884	45.3	2,522	44.9	14.4
Sales expense	272	4.3	230	4.1
G&A expense	246	3.9	230	4.1
R&D expense	1,124	17.7	1,036	18.4
Operating profit	1,242	19.4	1,026	18.3	21.1
Non-operating income & exp.	138	2.2	(43)	(0.8)
Profit before tax	1,380	21.6	983	17.5	40.4
Net profit	1,096	17.2	795	14.2	37.9
Belong
Parent company	1,120		832
Non-Controlling Interests	(24)		(37)
*** EPS (NT$)**	2.78		2.00		39.0

*** 3Q18 and 3Q17 based on the 304 million shares and 434 million shares respectively (Unreviewed)**

*** The record date of capital reduction was at the end of Aug. 2018.**

*** Based on the weighted average number of shares outstanding**

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ELAN Microelectronics Corp.

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1Q18~3Q18 Income Statement YoY Comparison (Consolidated)

1Q18~3Q18 Income Statement YoY Comparison (Consolidated)	1Q18~3Q18 Income Statement YoY Comparison (Consolidated)	1Q18~3Q18 Income Statement YoY Comparison (Consolidated)	1Q18~3Q18 Income Statement YoY Comparison (Consolidated)	1Q18~3Q18 Income Statement YoY Comparison (Consolidated)	1Q18~3Q18 Income Statement YoY Comparison (Consolidated)	1Q18~3Q18 Income Statement YoY Comparison (Consolidated)	1Q18~3Q18 Income Statement YoY Comparison (Consolidated)	1Q18~3Q18 Income Statement YoY Comparison (Consolidated)
NT$M
	1Q18	%	2Q18	%	3Q18	%	1Q18~3Q18	%
Sales	1,779	100.0	2,104	100.0	2,484	100.0	6,367	100.0
Grossprofit	790	44.4	948	45.1	1,146	46.1	2,884	45.3
Sales expense	72	4.0	103	4.9	97	3.9	272	4.3
G&A expense	78	4.4	82	3.9	86	3.5	246	3.9
R&D expense	352	19.8	376	17.9	396	15.9	1,124	17.7
Operating profit	288	16.2	387	18.4	567	22.8	1,242	19.4
Non-operating income & exp.	40	2.2	74	3.5	24	1.0	138	2.2
Profit before tax	328	18.4	461	21.9	591	23.8	1,380	21.6
Netprofit	259	14.6	365	17.3	472	19.0	1,096	17.2
Belong
Parent company	264		376		480		1,120
Non-Controlling Interests	(5)		(11)		(8)		(24)
*** EPS(NT$)**	0.63		0.91		1.28		2.78

*** Based on the weighted average number of shares outstanding**

*** The record date of capital reduction at the end of Aug. 2018 affected the weighted shares used for calculation of EPS; therefore, the sum of each quarterly EPS was not equal to the EPS as of September.**

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Balance Sheets September 30, 2018 (Consolidated)

NT$M	NT$M
Current assets	8,526
Cash and cash equivalents	3,058
Current financial assets	634
A/R&A/N	2,205
Inventory	1,158
Other current assets	58
Other current financial assets	1,413
Non-current financial assets	1,366
Fixed assets	617
Other non-current assets	289
Total Assets	10,798
Current liabilities	4,218
Non- current liabilities	397
Total Liabilities	4,615
Capital stock	3,039
Capital surplus	444
Retained earnings	2,561
Other equity interest	212
Treasury stock	(33)
Non-controlling interests	(40)
Total Stockholders' Equity	6,183
(Unreviewed)

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ELAN Microelectronics Corp.

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Cash Flow Statement September 30, 2018 (Consolidated)

Cash Flow Statement eptember 30, 2018 (Consolida	Cash Flow Statement eptember 30, 2018 (Consolida
NT$M
Income before tax	1,380
Dep & Amort.	72
Inc. of A/R & N/R	(370)
Inc. of inventory	(75)
Inc. of A/P & N/P	233
Others	(181)
Operating cashflow	1,059
Inc.F/A	(72)
Dec. of investments	71
Dec.Time deposit with maturity over three-month	1,127
Acquisition of intangible assets	(18)
Others	2
Investment cashflow	1,110
Inc. in short-term loans payable	322
Dec. in short-term loans payable	(344)
Distribution of cash dividends	(1,074)
Others	1
Financing cashflow	(1,095)
Change in cash	1,074
Beg. Cash	1,984
End Cash	3,058
(Unreviewed)

ELAN Microelectronics Corp.

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4Q18 Guidance

Based on Current Assumptions of Future Prospects, ELAN Expects:

• Consolidate Revenue to be Approximately

• between NT$ 2.26 Billion and NT$ 2.31 Billion

• Gross Margin to be about 45.5% to 46.5%

• Operating Income Rate to be about

• 21.1% to 22.7%

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ELAN Microelectronics Corp.

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The Wave of the Stylus

?! Smartphone Tablet PC Notebook PC

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ELAN Microelectronics Corp.

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Touch Controller with Pen Function Shipment

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----- Start of picture text -----

Unit: Set
MPP2.0
MPP1.51
MPP1.5
MPP1.0
----- End of picture text -----

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ELAN Microelectronics Corp.

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Different Stylus Solutions for Mobile Phone

X Pen Q Stylus M Pen S Pen Capacitive Passive Capacitive EMR Pen Pen Pen Samsung Infinix LG Huawei Note Series Note 4/5 Pro Q Stylus+ Mate 20X

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ELAN Microelectronics Corp.

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Apple Pen for Mobile Phone Strategy ? Apple iOS Already Support Stylus Application

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Demo

Apple iOS

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ELAN Microelectronics Corp.

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ELAN TDDI Products Strategy 1. For FHD Model Support Low Cost Solution: Passive Pen

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2. For FHD Model Support High Performance Solution: Active Pen

(i) Precise Pressure Levels (ii) High Hover Control (iii) Tilt Angles (iv) Fast Report Rate

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ELAN Microelectronics Corp.

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Q & A

Q & A