ELAN — Interim / Quarterly Report 2018

Feb 26, 2019

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ELAN Microelectronics Corp.

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ELAN Microelectronics Corp.

4Q18 Investor Conference

2019/02/26

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ELAN Microelectronics Corp.

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Sales Breakdown by Product Line (Consolidated)

Sales: NT$M 7,503 8,651 1,589 1,867 2,160 1,887 1,779 2,104 2,484[2,284] • Touch: Touchscreen Controller, Touchpad, Biometrics • Non-Touch: MCU, Pointing Stick, Affiliated Co. Products

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ELAN Microelectronics Corp.

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4Q18 Income Statement YoY Comparison (Consolidated)

	4Q18	%	4Q17	%	YoY(%)
Sales	2,284	100.0	1,887	100.0	21.0
Gross profit	1,060	46.4	826	43.8	28.3
Sales expense	80	3.5	80	4.2
G&A expense	85	3.7	71	3.8
R&D expense	407	17.8	351	18.6
Operating profit	488	21.4	324	17.2	50.6
Non-operating income & exp.	2	0.1	(45)	(2.4)
Profit before tax	490	21.5	279	14.8	75.6
Net profit	436	19.1	237	12.6	84.0
Belong
Parent company	440		242
Non-Controlling Interests	(4)		(5)
*** EPS (NT$)**	1.51		0.58		160.3

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4Q18 Income Statement QoQ Comparison (Consolidated)

	4Q18	%	3Q18	%	QoQ(%)
Sales	2,284	100.0	2,484	100.0	(8.1)
Gross profit	1,060	46.4	1,146	46.1	(7.5)
Sales expense	80	3.5	97	3.9
G&A expense	85	3.7	86	3.5
R&D expense	407	17.8	396	15.9
Operating profit	488	21.4	567	22.8	(13.9)
Non-operating income & exp.	2	0.1	24	1.0
Profit before tax	490	21.5	591	23.8	(17.1)
Net profit	436	19.1	472	19.0	(7.6)
Belong
Parent company	440		480
Non-Controlling Interests	(4)		(8)
*** EPS (NT$)**	1.51		1.28		18.0

• 4Q18 based on 304 million shares.

• In 3Q18, Jul. ~ Aug. based on 434 million shares and Sep. based on 304 million shares respectively.

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

• Based on the weighted average number of shares outstanding.

義隆電子

ELAN Microelectronics Corp.

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2018 Income Statement YoY Comparison (Consolidated)

	~~NT$M~~	~~NT$M~~	~~NT$M~~	~~NT$M~~	~~NT$M~~
	2018	%	2017	%	YoY(%)
Sales	8,651	100.0	7,503	100.0	15.3
Gross profit	3,944	45.6	3,348	44.6	17.8
Sales expense	352	4.1	310	4.1
G&A expense	331	3.8	301	4.0
R&D expense	1,531	17.7	1,387	18.5
Operating profit	1,730	20.0	1,350	18.0	28.1
Non-operating income & exp.	140	1.6	(88)	(1.2)
Profit before tax	1,870	21.6	1,262	16.8	48.2
Net profit	1,532	17.7	1,032	13.8	48.4
Belong
Parent company	1,560		1,074
Non-Controlling Interests	(28)		(42)
*** EPS (NT$)**	4.16		2.58		61.2
*	(Unaudited)

*** 2017 based on 434 million shares.**

*** In 2018, Jan. ~ Aug. based on 434 million shares and Sep. ~ Dec. based on 304 million shares respectively. * 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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1Q18~4Q18 Income Statement (Consolidated)

1Q18~4Q18 Income Statement (Consolidated)	1Q18~4Q18 Income Statement (Consolidated)	1Q18~4Q18 Income Statement (Consolidated)	1Q18~4Q18 Income Statement (Consolidated)	1Q18~4Q18 Income Statement (Consolidated)	1Q18~4Q18 Income Statement (Consolidated)	1Q18~4Q18 Income Statement (Consolidated)	1Q18~4Q18 Income Statement (Consolidated)	1Q18~4Q18 Income Statement (Consolidated)	1Q18~4Q18 Income Statement (Consolidated)	1Q18~4Q18 Income Statement (Consolidated)
NT$M
	1Q18	%	2Q18	%	3Q18	%	4Q18	%	1Q18~4Q18	%
Sales	1,779	100.0	2,104	100.0	2,484	100.0	2,284	100.0	8,651	100.0
Grossprofit	790	44.4	948	45.1	1,146	46.1	1,060	46.4	3,944	45.6
Sales expense	72	4.0	103	4.9	97	3.9	80	3.5	352	4.1
G&A expense	78	4.4	82	3.9	86	3.5	85	3.7	331	3.8
R&D expense	352	19.8	376	17.9	396	15.9	407	17.8	1,531	17.7
Operating profit	288	16.2	387	18.4	567	22.8	488	21.4	1,730	20.0
Non-operating income & exp.	40	2.2	74	3.5	24	1.0	2	0.1	140	1.6
Profit before tax	328	18.4	461	21.9	591	23.8	490	21.5	1,870	21.6
Netprofit	259	14.6	365	17.3	472	19.0	436	19.1	1,532	17.7
Belong
Parent company	264		376		480		440		1,560
Non-Controlling Interests	(5)		(11)		(8)		(4)		(28)
*** EPS(NT$)**	0.63		0.91		1.28		1.51		4.16
(Unaudited)

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

*** Jan. ~ Aug. based on 434 million shares and Sep. ~ Dec. based on 304 million shares respectively. * 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 December.**

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Balance Sheets December. 31, 2018 (Consolidated)

	NT$M
Current assets	7,438
Cash and cash equivalents	2,076
Current financial assets	655
A/R&A/N	1,753
Inventory	1,156
Other current assets	39
Other current financial assets	1,759
Non-current financial assets	1,307
Fixed assets	768
Other non-current assets	280
Total Assets	9,793
Current liabilities	2,818
Non- current liabilities	392
Total Liabilities	3,210
Capital stock	3,039
Capital surplus	444
Retained earnings	3,006
Other equity interest	172
Treasury stock	(33)
Non-controlling interests	(45)
Total Stockholders' Equity	6,583

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ELAN Microelectronics Corp.

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Cash Flow Statement December. 31, 2018 (Consolidated)

Cash Flow Statement December. 31, 2018 (Consolidated)	Cash Flow Statement December. 31, 2018 (Consolidated)
NT$M
Income beforetax	1,870
Dep &Amort.	96
Inc.of A/R&N/R	(169)
Inc. of inventory	(96)
Inc. of A/P & N/P	80
Others	42
Operating cashflow	1,848
Inc.F/A	(249)
Dec.of investments	73
Dec.Time deposit with maturityover three-month	780
Acquisition of intangible assets	(19)
Others	4
Investment cashflow	589
Inc. in short-term loans payable	373
Dec. in short-term loanspayable	(370)
Distribution of cash dividends	(1,074)
Reduction of Capital	(1,250)
Others	1
Financing cashflow	(2,320)
Change in cash	92
Beg. Cash	1,984
End Cash	2,076
(Unaudited)

ELAN Microelectronics Corp.

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1Q19 Guidance

Based on Current Assumptions of Future Prospects, ELAN Expects:

• Consolidate Revenue to be Approximately

• between NT$ 1.96Billion and NT$ 2.08 Billion

• Gross Margin to be about 46% to 47%

• Operating Income Rate to be about 18.1% to 20.7%

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ELAN Microelectronics Corp.

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Touchscreen with Stylus Support Shipment

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Touchscreen Pen %
20000 60%
18000
50%
16000
48%
14000
40%
12000
36%
10000 30%
8000
23% 23% 20%
6000
4000
10%
2000
4%
0 0%
20142014 20152015 201620162016 20172017 20182018
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ELAN Microelectronics Corp.

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Touchpad for Commercial Market Shipment

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Touchpad Commercial %
70000 12%
60000
10%
10%
50000
8%
40000
6%
6%
30000
4%
20000
4%
2%
10000
2%
0 0%
20152015 20162016 20172017 20182018
2016
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義隆電子

ELAN Microelectronics Corp.

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Notable Devices with ELAN Touchscreen Solution 2019 CES Announced

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DELL Inspiron 7000 2-in-1s
with MSFT Pen
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Acer Chromebook 315 with Chrome OS Touch

HP Spectre x360 15 on OLED with MSFT Pen

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Dell XPS 15 Dell XPS 13 HP Chromebook X360 14 G1 Asus Chromebook Flip C434 on OLED Display on LCD Display on Chrome OS Touch on Chrome OS Touch

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義隆電子

ELAN Microelectronics Corp.

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Notable Devices with ELAN Touchpad Solution 2019 CES Announced

Asus Zenbook 14 UX431 with Number Pad

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Asus Zenbook S13 UX392 with Fingerprint Sensor

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HP Chromebook X360 14 G1 with Chrome OS Touchpad

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Asus Chromebook Flip C434 with Chrome OS Touchpad

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DELL Inspiron 7000 2-in-1s With ELAN’s Smart Usability

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Razer Blade 15 ELAN Big Touchpad (Large by ~50%)

義隆電子

ELAN Microelectronics Corp.

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Matebook 13 and Matebook 14 2019 MWC Announced

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13” 14”
HUAWEI MateBook HUAWEI MateBook
13 14
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Brilliant Screen-to-body Ratio MateBook 13 - 88% MateBook 14 - 90%

Starting Price: MateBook 13 - €999 MateBook 14 - €1199

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ELAN Microelectronics Corp.

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Q & A

Q & A