Macronix — Interim / Quarterly Report 2018

Oct 24, 2018

Macronix International Co., Ltd. Third Quarter 2018 Results October 24, 2018

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Disclaimer

The presentation and discussion contain certain forward-looking statements with respect to the results of operation, financial condition and current expectation. The forward-looking statements are subject to known and unknown uncertainties and risks that could cause actual results to differ materially from those expressed or implied by such statements.

Such risks and uncertainties include but are not limited to the impact of competitive products and pricing, timely design acceptance by our customers, timely introduction of new technologies, ability to ramp new products into volume, industry wide shifts in supply and demand for semiconductor products, industry overcapacity, availability of manufacturing capacity, financial stability in end markets, and other risks.

The forward-looking statements in this release reflect the current belief of Macronix as of the date of this release and Macronix undertakes no obligation to update these forward-looking statements for events or circumstances that occur subsequent to such date.

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Copyright © Macronix International Co., Ltd.

Agenda

Welcome

2018Q3 Financial Results Business Update Remarks and Q&A

Copyright © Macronix International Co., Ltd.

Miin Wu Paul Yeh Miin Wu Miin Wu

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Financial Highlights

2018Q3 2018Q2 2017Q3 Revenue NT$ 10.0B NT$ 8.9B NT$ 10.5B Gross margin % 35% 45% 38% Operating margin % 18% 24% 20%

Copyright © Macronix International Co., Ltd.

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Agenda

Welcome

Welcome Miin Wu 2018Q3 Financial Results Paul Yeh Business Update Miin Wu Remarks and Q&A Miin Wu

Copyright © Macronix International Co., Ltd.

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Quarterly Consolidated Statements of Comprehensive Income

Unit: NTD Million (except EPS)� 2018/Q3 2018/Q2 2017/Q3 Net Sales 10,030 8,880 10,467 Gross Profit 3,546 4,031 4,022 Gross Margin% 35% 45% 38% Operating Expenses (1,783) (1,894) (1,923) Operating Income 1,763 2,137 2,098 Operating Margin% 18% 24% 20% Net Non-Operating Income (Loss) 155 196 30 Income Before Taxes 1,918 2,333 2,128 Income Taxes Expense (benefit) 2 6 5 Net Income 1,916 2,327 2,123 Other Comprehensive Income 60 (253) 138 Comprehensive Income 1,976 2,074 2,261 Net Income(Loss) Attributable to : Shareholders of the Parent 1,916 2,327 2,123 NoncontrollingInterests 0 0 (0)	QoQ YoY Change Change 13% (4%) (12%) (12%) (10ppt) (3ppt) (6%) (7%) (18%) (16%) (6ppt) (2ppt) - - (18%) (10%) - - (18%) (10%) - - (5%) (13%) (18%) (10%)
Basic EPS(NT$) 1.05 1.28 1.18 *	(18%) (11%)
EBITDA 2,486 2,882 2,667 Weighted avg outstanding million shares 1,822 1,822 1,801

*EPS is retro-adjusted

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Copyright © Macronix International Co., Ltd.

2018Q3 Financial Highlights

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Gross Margin (%)
50% 45%
43%
42%
38%
35%
32% 34%
31%
27%
25%
15%
14%
0%
16Q1 Q2 Q3 Q4 17Q1 Q2 Q3 Q4 18Q1 Q2 Q3
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Copyright © Macronix International Co., Ltd.

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Annualized Return on Equity Performance

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40%
33%
30%
29%
30%
26%
20%
20%
9%
10%
4%
0%
17Q1 Q2 Q3 Q4 18Q1 Q2 Q3
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Copyright © Macronix International Co., Ltd.

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Quarterly Consolidated Balance Sheet / Cash Position

Unit: NTD Million (except BV) Cash Inventory(Net) Property, Plant and Equipment Total Assets Interest bearing debt - short term Interest bearing debt - long term Total Liabilities Shareholders' Equity Debt Ratio (%) Book Value -- NT$ Quarterly Highlight Depreciation & Amortization Capital Expenditures Cash Flow from Operating	2018/09/30 2018/06/30 2017/09/30
	10,502 11,237 6,883 17,160 14,297 9,389 18,389 17,934 15,490 56,907 53,251 41,361 1,986 2,705 8,233 7,504 5,384 963 27,826 26,163 19,656 29,081 27,087 21,705 48.9% 49.1% 47.5% 15.82 15.03 12.04 2018/Q3 2018/Q2 2017/Q3
	534 514 488 (1,381) (834) (657) 1,061 2,622 1,970

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Copyright © Macronix International Co., Ltd.

Quarterly Sales Breakdown by Products

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12,000
9,000
6,000
3,000
0
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QoQ YoY
62% 55% Change Change
Flash -16% -15%
74%
ROM +147% +15%
FBG -21% -9%
FBG (foundry business group)
39%
32%
17%
6% 9% 6%
2017Q3 2018Q2 2018Q3
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Copyright © Macronix International Co., Ltd.

Agenda

Welcome

Welcome Miin Wu 2018Q3 Financial Results Paul Yeh Business Update Miin Wu Remarks and Q&A Miin Wu

Copyright © Macronix International Co., Ltd.

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Business update - ROM

 ROM business

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•
≥ 64Gb products represented 60% of ROM business in 2018Q3
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1,986
2,000
Density shipment index: 2014Q1 =100
1,756
1,417
1,121
927
1,000
753
451
416
318 307 326
174
147
100 89 110 72 103 81
0
14Q1 Q2 Q3 Q4 15Q1 Q2 Q3 Q4 16Q1 Q2 Q3 Q4 17Q1 Q2 Q3 Q4 18Q1 Q2 Q3
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Business update – Flash

Density shipment index: 2015Q1 =100

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600
506
443
386
377
346 342
309
289
300 271 257
186
158
141 141
100
0
15Q1 Q2 Q3 Q4 16Q1 Q2 Q3 Q4 17Q1 Q2 Q3 Q4 18Q1 Q2 Q3
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Copyright © Macronix International Co., Ltd.

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Current status of Flash memory business

 Flash business

• ≤75nm products increased to 63% of NOR sales in 18Q3

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4,000 Accumulative design-win case count 3,728
2,676
3,170
2,021
2,000 1,624
2,239
1,139 1,862
1,375
349
756
0
16Q1 Q2 Q3 Q4 17Q1 Q2 Q3 Q4 18Q1 Q2 Q3
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Copyright © Macronix International Co., Ltd. 13
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Business update – NOR flash breakdown (Parent Company)

2017Q3 NOR Revenue breakdown

2018Q3 NOR Revenue breakdown

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Consumer, Consumer,
Comm,
31% Comm, 21%
31%
31%
Computer,
Computer,
21%
23%
Auto , 13%
I.M.A.,
I.M.A., 8% Auto , 9% 12%
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*** Comm:** including handsets

*** I (Industrial), M (Medical), A** (Aerospace-defense)

Computer Consumer -5% QoQ +6% QoQ -7% YoY -40% YoY

Automotive

Communication

+9% QoQ +7% QoQ -16% YoY +20% YoY

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Capex plan

 Capex plan & technology migration

• NTD14.2B investment for Fab5(12”) technology migration and R&D

• Fully technology migration to 19nm in Fab5

• Total 12” wafer capacity is still ~21K per month

Copyright © Macronix International Co., Ltd.

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Agenda

Welcome

Welcome Miin Wu 2018Q3 Financial Results Paul Yeh Business Update Miin Wu Remarks and Q&A Miin Wu

Copyright © Macronix International Co., Ltd.

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For more information regarding Macronix http://www.macronix.com

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For all inquiries, suggestions and comments ir@mxic.com.tw