LP — Investor Presentation 2018

Dec 4, 2018

Code:1447

2018 CONFERENCE

Disclaimer Clause

DISCLAIMER:
This PPT encloses the info. of the company’s internal and external data and includes the business performance, financial statement, and sales development.
Lealea doesn’t enclose any financial prediction. There might be variation or difference from actual situation if Q&A involves any predictive sales, industrial or financial matters. This is subject to the market demand & supply, price variation, competition, international economy, exchange rate or downstream/upperstream…etc.
Company prospection in PPT is based on Lealea’s point of view, and it may vary by time. Lealea is not responsible for any instant update nor reminder.

Agenda

一. Company Profile
二. Production Capabilities?三. Mani Production
四. Performance?五. Field Trend(SWOT)?六. Solution

Company Profile

Established Year: 1975

Paid-in Capital: NT91.45 billion

Chairman : James Kuo

Employees : 1343

Date of Listing : 1992 (NO.1447)

Li Peng Enterprise Co., Ltd. was founded.

Li Peng dyeing and finishing plant was established in Yang-mei.
Business philosophy
Diligence/
Integrity/
Initiative/
Innovation
Li Peng weaving plant was established in Yang-mei.
2

Li Peng Enterprise was registered
on the Taiwan Stock Exchange (IPO).
The 6th nylon chip production line is completed,
daily production to reach 500 tons.
Li Peng Changhua polyamide main factory was established.

LIBOLON International Trading Co., Ltd
was established.
Knitting department
was established.
LIBOLON is the first manufacturer in Taiwan
received the GRS certification.

Production
Capabilities

Performance

| Performance of Li Peng Enterprise Unit: thousand | | | | |
| --- | --- | --- | --- | --- |
| | 2015 | 2016 | 2017 | 2018 ( Jan to Sep) |
| Gross Sales | 16,681,998 | 14,282,759 | 16,591,706 | 14,013,230 |
| Gross Profit | 387,535 | 656,792 | 888,618 | 684,846 |
| Operating Expenses | 629,838 | 665,525 | 708,455 | 545,137 |
| Operating Income | (242,303) | (8,733) | 180,163 | 139,709 |
| Total Non-Op.Income | 292,882 | (36,607) | (430,891) | 402,803 |
| Pre-Tax Income | 50,579 | (45,340) | (250,728) | 542,512 |
| Income Tax Expense | 4,389 | 16,484 | (64,235) | 56,736 |
| Net Income | 46,190 | (61,824) | (186,493) | 485,776 |
| Earning Per Share | 0.02 | ( 0.10 ) | (0.21) | 0.53 |
| Gross Profit Rate | 2.32% | 4.60% | 5.36% | 4.89% |
| Operating Income Rate | (1.45%) | (0.06%) | 1.09% | 1.00% |
| ROE | 0.43% | (0.58%) | (1.75%) | 4.41% |

Li Peng
Nylon Business Revenue Trend

Unit: million
2018

2017

JAN

APR

MAY
JUN

JUL

AUG

SEP

FEB
MAR
Unit: million
TOTAL

JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP

2018

2017

Li Peng High End Textile Business Revenue Trend

Unit: million

2018

2017

JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP

Unit: million
TOTAL

JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP

2018

2017

Main Product

1.Nylon 6 Chips (SD、FD、BR), Engineering Plastic Chips、
Nylon 6 Yarn(POY、FDY)
2.Fabric (Garment 72%、Home textile 26%、Other2%)
3.Yarn Dye
4.Piece Dye

Fabric Sales

Turnover Comparison(Q1-Q3) :
2017(NT$ 2.51 billion) / 2018(NT$ 2.64 billion)
2. Main Sales market : Europe. Middle East, USA
3. Main Sales Brand :
4. New developed brands in 3-year :
5. Product classification and Sales ratio :
Garment 72.3%, Home Textile 26.8%
6. US-China Trade war is not much influenced to Fabric and
Dyeing(LP), and urgent orders can return to Taiwan
7. Prospect :
Eastern Europe and US outdoor markets will grow by 15%

ANNUAL EXHIBITION

Core Value Product

Industry Trend

-- Strengths --
Advantage of vertical integration from Polymerization,
Spinning, Texturing, Weaving/Knitting, Dyeing and
Distribution with rapid R&D production.
Long-term fabric sales with every Garment brand and
it annual growth is about 15%.
3. The small and medium-sized dyeing plants are eliminated
in domestic market and the commissioning dyeing volume
is increased.
New production plant in Indonesia and flexible shipping to
different markets.

Industry Trend

-- Weaknesses --
Regular Specifications of Nylon6 Chip and Yarn are in
the competition to China low price policy
Domestic ecology is strictly regulated and the cost of
labor adjustment is increased gradually
The ordinary fabric in mass production is expanding in South-Asian countries and the conversion fee is hardly increased
CPL price is fluctuated unstably, risk increase, limited supply
Tariff barrier

Solution

To distribute the sales of ordinary Nylon6 Chip into different
markets and increase the development of EP Chip
(New production line is under consideration)
2. Increase the sales of Home Textile and Functional Fabric
(Current ratio is 25%)
3. New purchase of Weaving machine(3.6m width) and its
application is to increase the high-value products
To expand Productivity 4.0 and enhance Production
Efficiency and Quality Control

Q&A