GEM — Investor Presentation 2017

Nov 23, 2017

==> picture [721 x 68] intentionally omitted <==

==> picture [269 x 37] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

GEM TERMINAL IND. CO., LTD.

2017 Investor onC ference

==> picture [721 x 136] intentionally omitted <==

Stock Symbol: 2460 http://www.gem.com.tw/CnIndex.asp

==> picture [121 x 68] intentionally omitted <==

==> picture [121 x 26] intentionally omitted <==

==> picture [120 x 68] intentionally omitted <==

==> picture [120 x 26] intentionally omitted <==

==> picture [121 x 68] intentionally omitted <==

==> picture [121 x 26] intentionally omitted <==

Contents

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

Disclaimer

I. Business Overview: Production Base,

Product Classification and Proportion , Sales Performance

II. Industry Challenge III. Direction of the product development IV. Consolidated Financ ai l Information V. Conclusion

2

Disclaimer

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

This report and simultaneously released information are the Company’s internal and external data, and the Company’s vision is its views towards the future up to now. If there is any change to these views in the future , the Company is not liable for timely updating the information or sending reminder.

Th e C ompany h as no t re ease l d fi nanc a i l f orecas t . A ny descriptions related to the Company’s financial and business status, or Q&A details in this report may be differentiated from the actual results in the future. Such difference may be caused by the change of market demand, ex-factory price, fluctuation of raw material p rice, industr y com p etition, world econom y , fluctuation of exchange rate, upstream / downstream supply chain, and other risk factors that are out of the Company’s control.

3

==> picture [179 x 42] intentionally omitted <==

Production Base

==> picture [721 x 406] intentionally omitted <==

==> picture [199 x 48] intentionally omitted <==

==> picture [195 x 47] intentionally omitted <==

4

Production Base (cont’d)

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

==> picture [409 x 38] intentionally omitted <==

GEM Terminal IND. Co., Ltd.

Address: Luzhu District, Kaohsiung City Land area: 17,331.45 m[2] Plant area: 11,674.63 m[2]

==> picture [404 x 18] intentionally omitted <==

Suzhou GEM Opto-electronics Terminal Co., Ltd. Address: Xiangcheng District , Suzhou City , Jiangsu Province Land area: 81,364 m[2] Plant area: 47,355.14 m[2]

==> picture [404 x 19] intentionally omitted <==

Dongguan GEM Electronic & Metal Co., Ltd. Address: Humen Township, Dongguan City, Guangdong Province Land area: 42,270.20 m[2] Plant area: 24,352.24 m[2]

Vietnam GEM Electronic and Metal Co., Ltd. Address: Nam Tan Uyen , Binh Duong Land area: 24,700 m[2] Plant area: 33,247.90 m[2]

==> picture [404 x 15] intentionally omitted <==

5

Product Classification and Proportion

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

==> picture [721 x 323] intentionally omitted <==

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

UL, CSA, PSE
Europe Community
Great British
China GB Plug Blades
Motor Parts
Electronics &
Communication
Others
E
lectric P
lug
----- End of picture text -----

==> picture [721 x 68] intentionally omitted <==

The proportion of products that have adopted the process ngi technology of Contour Strips : 51.21%

6

2006-2017 Sales Performance

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

Consolidated Sales Revenue and LME Copper Price Comparison Chart

C onso lid a t e d sales revenue

==> picture [721 x 356] intentionally omitted <==

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

C onso lid a t e d LME copper
sales revenue price
500,000 15,000
442,849 444,394
450,000
415 , 248 402,205 13,000
391,887 394,508
400,000 376,316 372,826
363,971
11,000
350,000 334,802
307,254
300,000 275,754 9 , 000
8,819
250,000 7,950 7,000
7,326
7,101 7,136
6,896 6,860
6,677
200,000
5,502 5 948, 5 , 000
5,193
150,000 4,863
3,000
100,000
50,000 1 , 000
-
-1,000
----- End of picture text -----

7

Industr Challen e y g

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

1. Environmental Protection Issues

The Mainland China will complete the issuance of emission / effluent permit to key industries of “Ten Rules of Water” and industries with excessive ca acit in 2017. Those who fail to p y comply with the emission / effluent standards or do not have the permit will be forced to have their plants shut down. All o s duction bases in f GEM‘ four pro Taiwan, the Mainland China and Vietnam possess legal plating permit and comply with local emission / effluent standards.

8

Industr Challen e (cont’d) y g

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

2. The increasing labor salary in Mainland China

A. The GEM Vietnam plant was officially launched in March, 2016. The comparison of labor cost is shown below. B. International division of labor, which can lower the production cost and increase the Company’s competitiveness, is now under the negotiation.

Labor Cost

==> picture [721 x 212] intentionally omitted <==

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

Unit: NTD
30,000
25,000 28,100
20,000
15,000
10,000
12,300
5,000
-
China 大陸 Vietnam 越南
----- End of picture text -----

9

Direction of the product development

1. Applications of the special-shape

material processing technology

A. GEM has over 20 years of production

experiences, which are widely applied in products such as plugs of electrical appliances - and lead frames (photos on the right hand side).

B. This technology is now applied in contacts and connectors of electric cars, and is at the development and mass production (with limited quantity) stage .

C. Will head towards the customization of highend special-shape materials or products in the future.

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

==> picture [236 x 14] intentionally omitted <==

==> picture [236 x 68] intentionally omitted <==

==> picture [236 x 69] intentionally omitted <==

==> picture [236 x 32] intentionally omitted <==

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

Applications of special-shape materials in electrical
appliances and vehicles (contacts and connectors)
----- End of picture text -----

==> picture [238 x 35] intentionally omitted <==

==> picture [238 x 69] intentionally omitted <==

==> picture [238 x 78] intentionally omitted <==

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

Applications of ultra-thin materials, which is 0.8
mm, n eepers. i b
----- End of picture text -----

10

Direction of the product development (cont’d)

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

2.Eco-friendly products with low-lead and -copper

content.

• A. Already developed eco friendly products that comply with the ROHS future requirements (Pb<1000PPM). B. The Com an is a ioneer in develo ment of eco-friendl roducts. p y p p y p C. Products with mass production have adopted materials such as H60 and H62. Photos are shown below.

==> picture [721 x 136] intentionally omitted <==

==> picture [317 x 26] intentionally omitted <==

==> picture [317 x 26] intentionally omitted <==

11

Consolidated Financial Information

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

Unit: NTD1 , 000

	Year Item	2013	2014	2015	2016	JAN to SEP of 2017
	O ti pera ng revenue	4,022,046	3,945,079	3,728,264	3,639,715	2,757,535
	Operating	457,904	527,307	342,599	490,750	279,965
	margin
	Net profit before tax	22,657	140,157	-28,568	88,595	-29,633
	Capital	1,715,980	1,715,980	1,692,000	1,692,000	1,692,000
	Earningsper
	share (EPS)	0 09 .	0 51 .	0 24 - .	0 27 .	0 19 - .
	Gross margin (%)	12%	13%	9%	13%	10%

12

Consolidated Financial Information (cont’d)

==> picture [179 x 42] intentionally omitted <==

==> picture [179 x 5] intentionally omitted <==

A Comparison Chart of the First Three Quarters of 2017 Operating Revenue Net Profit before Tax

==> picture [721 x 236] intentionally omitted <==

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

5,000
1,200,000
1,161
963,010 1 000 146, ,
1,000,000 0
794,379 2017Q1 2017Q2 2017Q3
800,000
(5,000)
600 , 000
(10,000)
400,000
(12,654)
200,000 ( 15,000 )
0
(20,000) (18,140)
2017Q1 2017Q2 2017Q3
----- End of picture text -----

13

Conclusion

==> picture [179 x 42] intentionally omitted <==

==> picture [721 x 69] intentionally omitted <==

The Future will enhance our development according to the future trend , including:

• ⑴ Use hi g h-end s p ecial-sha p e materials or products, and high-end electric contacts and connectors in electric cars.

• Follow the world trend to eco

• ⑵ develop friendly products with low-lead and -copper contents.

14

==> picture [721 x 136] intentionally omitted <==

End of the Presentation Thank you!

==> picture [721 x 142] intentionally omitted <==

15