Macronix — Interim / Quarterly Report 2019

Oct 24, 2019

Macronix International Co., Ltd. Third Quarter 2019 Results October 24, 2019

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Safe Harbor Statement

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

2019Q3 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

	2019Q3	2019Q2	2018Q3
	Unaudited	Audited	Audited
Revenue	NT$ 11.9B	NT$ 7.5B	NT$ 10.0B
Gross margin %	30%	27%	35%
Operating margin %	15%	6%	18%

Copyright © Macronix International Co., Ltd.

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Agenda

Welcome

Welcome Miin Wu 2019Q3 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) Net Sales Gross Profit Gross Margin% Operating Expenses Operating Income Operating Margin% Net Non-Operating Income (Loss) Income Before Taxes Income Taxes Expense (benefit) Net Income Other Comprehensive Income Comprehensive Income Net Income(Loss) Attributable to : Shareholders of the Parent NoncontrollingInterests	2019/Q3 Unaudited 2019/Q2 Audited 2018/Q3 Audited	QoQ Change YoY Change 59% 19% 79% 1% 3ppt (5ppt) 17% 1% 276% 1% 9ppt (3ppt) - - 332% (3%) - - 601% (3%) - - 542% (7%) 603% (3%)
	11,906 7,479 10,030 3,576 2,003 3,546 30% 27% 35% (1,797) (1,530) (1,783) 1,778 473 1,763 15% 6% 18% 79 (43) 155 1,857 430 1,918 4 166 2 1,853 264 1,916 (17) 22 60 1,836 286 1,976 1,853 264 1,916 0 1 0
Basic EPS(NT$)	1.01 0.14 1.05	621% (4%)
EBITDA Weighted avg outstanding million shares	2,604 1,134 2,486 1,830 1,830 1,822

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Copyright © Macronix International Co., Ltd.

2019Q3 Financial Highlights

2019Q3 Sales = NTD 11,906M +59% QoQ +19% YoY

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Sales Gross Profit
13,926M
NTD M 36,953M NTD M
4,500
12,000
9,000
3,000
6,000
1,500
3,000
0 0
18Q1 Q2 Q3 Q4 19Q1 Q2 Q3 18Q1 Q2 Q3 Q4 19Q1 Q2 Q3
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Copyright © Macronix International Co., Ltd.

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2019Q3 Financial Highlights

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2019Q3 2018Q3
Gross Margin (%) 30% 35%
Basic EPS -- NT$ 1.01 1.05
Basic EPS
Gross Margin (%)
(retro-adjusted)
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GM% NTD 4.94
50% 2.0
45%
43%
42%
1.57
38% 35%
34%
1.28
32%
27% 27% [30%] 1.04
25% 1.05 1.01
25% 1.0
0.14
0.08
0%
0.0
17Q1 Q2 Q3 Q4 18Q1 Q2 Q3 Q4 19Q1 Q2 Q3
18Q1 Q2 Q3 Q4 19Q1 Q2 Q3
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Copyright © Macronix International Co., Ltd.

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Quarterly Consolidated Condensed Balance Sheet / Cash Flow

Unit: NTD Million (except BV)	2019/09/30 Unaudited	2019/06/30 Audited	2018/09/30 Audited
Cash	7,957	11,520	10,502
Inventory(Net)	15,126	18,867	17,160
Property, Plant and Equipment	28,353	24,728	18,389
Total Assets	63,662	65,480	56,907
Interest bearing debt - short term	5,418	3,668	1,986
Interest bearing debt - long term	9,491	9,370	7,504
Total Liabilities	32,040	35,702	27,826
Shareholders' Equity	31,623	29,779	29,081
Debt Ratio (%)	50.3%	54.5%	48.9%
Book Value -- NT$	17.20	16.20	15.82
Quarterly Highlight	2019/Q3	2019/Q2	2018/Q3
Depreciation & Amortization	695	657	534
Capital Expenditures	(4,247)	(4,216)	(1,381)
Cash Flow from Operating	881	396	1,061

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Copyright © Macronix International Co., Ltd.

Quarterly Sales Breakdown by Products (Parent Company)

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12,000
9,000
44%
55%
QoQ YoY
Change Change
6,000
63% Flash +12% -6%
ROM +177% +58%
51%
FBG +10% +12%
3,000
39% * FBG (foundry business group)
29%
6% 8% 5%
0
2018Q3 2019Q2 2019Q3
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Copyright © Macronix International Co., Ltd.

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Agenda

Welcome

Welcome Miin Wu 2019Q3 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

• ≥ 64Gb products represented 83% of ROM business in 2019Q3

4,000

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3,564
Density shipment index: 2015Q1 =100
2,333
1,811
1,602
1,292
1,153
1,023
846
687 654
411 380
298
134 159
100 65 94 74
0
15Q1 Q2 Q3 Q4 16Q1 Q2 Q3 Q4 17Q1 Q2 Q3 Q4 18Q1 Q2 Q3 Q4 19Q1 Q2 Q3
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2,000

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Business update – Flash

Density shipment index: 2015Q1 =100

600

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506
443
386
377
351
346 342
309 305
289
300 271 266 272
257
186
158
141 141
100
0
15Q1 Q2 Q3 Q4 16Q1 Q2 Q3 Q4 17Q1 Q2 Q3 Q4 18Q1 Q2 Q3 Q4 19Q1 Q2 Q3
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Copyright © Macronix International Co., Ltd.

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Current status of Flash memory business

 Flash business

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•
≤75nm products increased to 71% of NOR sales in 19Q3
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5,000 Accumulative design-win case count
4,467 [4,703 ]
4,068 [4,246 ]
3,728
3,170
2,676
2,239
2,500 2,021
1,624 [1,862 ]
1,375
1,139
756
349
0
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16Q1Q2 Q3 Q417Q1Q2 Q3 Q418Q1Q2 Q3 Q419Q1Q2 Q3
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Copyright © Macronix International Co., Ltd.

Business update – NOR flash breakdown (Parent Company)

NTD % NOR breakdown b y density

	12%		12%		13%		16%		19%		22%		23%		25%		30%		29%		30%	(3
	48%		50%		47%
							52%
									48%
											44%
													45%
															43%
																			40%
																	42%				40%
	40%				40%
			38%
											34%
							32%		33%				32%		32%
																			31%		30%
																	28%

Copyright © Macronix International Co., Ltd.

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Business update – NOR flash breakdown (Parent Company)

2019Q2 NOR revenue breakdown

2019Q3 NOR revenue breakdown

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Consumer, Comm,
19% 34%
Computer,
22% I.M.A., Auto , 13%
12%
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Consumer, Comm,
21% 31%
Computer,
23%
I.M.A., Auto , 14%
11%
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*** Comm:** including handsets

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

2019Q3 NOR revenue comparison

Computer +9% QoQ -6% YoY

Consumer Communication Automotive I.M.A +22% QoQ -3% QoQ +18% QoQ +8% QoQ -5% YoY -4% YoY +4% YoY -11% YoY

Copyright © Macronix International Co., Ltd.

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Agenda

Welcome

Welcome Miin Wu 2019Q3 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