Macronix — Interim / Quarterly Report 2019

Aug 12, 2019

Macronix International Co., Ltd. Second Quarter 2019 Results July 25, 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

2019Q2 Financial Results Business Update Remarks and Q&A

Copyright © Macronix International Co., Ltd.

C.Y. Lu Paul Yeh C.Y. Lu C.Y. Lu

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Financial Highlights

2019Q2 2019Q1 2018Q2 Revenue NT$ 7.5B NT$ 6.0B NT$ 8.9B Gross margin % 27% 25% 45% Operating margin % 6% 1% 24%

Copyright © Macronix International Co., Ltd.

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Agenda

Welcome

Welcome C.Y. Lu 2019Q2 Financial Results Paul Yeh Business Update C.Y. Lu Remarks and Q&A C.Y. Lu

Copyright © Macronix International Co., Ltd.

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Quarterly Consolidated Statements of Comprehensive Income

Unit：NTD Million (except EPS) 2019/Q2 2019/Q1 2018/Q2 Net Sales 7,479 6,029 8,880 Gross Profit 2,003 1,531 4,031 Gross Margin% 27% 25% 45% Operating Expenses (1,530) (1,446) (1,894) Operating Income 473 86 2,137 Operating Margin% 6% 1% 24% Net Non-Operating Income (Loss) (43) 59 196 Income Before Taxes 430 144 2,333 Income Taxes Expense (benefit) 166 2 6 Net Income 264 142 2,327 Other Comprehensive Income 22 186 (253) Comprehensive Income 286 328 2,074 Net Income(Loss) Attributable to : Shareholders of the Parent 264 142 2,327 NoncontrollingInterests 1 (0) 0	QoQ YoY Change Change 24% (16%) 31% (50%) 2ppt (18ppt) 6% (19%) 452% (78%) 5ppt (18ppt) - - 199% (82%) - - 86% (89%) - - (13%) (86%) 86% (89%)
Basic EPS(NT$) 0.14 0.08 1.28 *	75% (89%)
EBITDA 1,134 810 2,882 Weighted avg outstanding million shares 1,830 1,830 1,822

*EPS is retro-adjusted

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Copyright © Macronix International Co., Ltd.

Gross margin trend

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Gross Margin (%)
50% 45%
43%
42%
38%
35%
32% 34%
31%
27% 28% 27%
25%
25%
15%
14%
0%
16Q1 Q2 Q3 Q4 17Q1 Q2 Q3 Q4 18Q1 Q2 Q3 Q4 19Q1 Q2
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Quarterly Consolidated Condensed Balance Sheet / Cash Flow

Unit: NTD Million (except BV)	2019/06/30	2019/03/31	2018/06/30
Cash	11,520	11,064	11,237
Inventory(Net)	18,867	18,475	14,297
Property, Plant and Equipment	24,728	21,931	17,934
Total Assets	65,480	60,133	53,251
Interest bearing debt - short term	3,668	3,621	2,705
Interest bearing debt - long term	9,370	5,411	5,384
Total Liabilities	35,702	28,438	26,163
Shareholders' Equity	29,779	31,695	27,087
Debt Ratio (%)	54.5%	47.3%	49.1%
Book Value -- NT$	16.20	17.24	15.03
Quarterly Highlight	2019/Q2	2019/Q1	2018/Q2
Depreciation & Amortization	657	624	514
Capital Expenditures	(4,216)	(2,603)	(834)
Cash Flow from Operating	396	249	2,622

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Copyright © Macronix International Co., Ltd.

Quarterly Sales Breakdown by Products (Parent Company)

12,000

0 3,000 6,000 9,000 ,000	74% 17% 8% 29% 9% 63% 8% 21% 71%

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Agenda

Welcome

Welcome C.Y. Lu 2019Q2 Financial Results Paul Yeh Business Update C.Y. Lu Remarks and Q&A C.Y. Lu

Copyright © Macronix International Co., Ltd.

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Business update - ROM

 ROM business

• ≥ 64Gb products represented 76% of ROM business in 2019Q2

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

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Business update – Flash

Density shipment index: 2015Q1 =100

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600
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506
443
386
377
346 342
309 305
289
271 257 272
266
186
158
141 141
100
0
15Q1 Q2 Q3 Q4 16Q1 Q2 Q3 Q4 17Q1 Q2 Q3 Q4 18Q1 Q2 Q3 Q4 19Q1 Q2
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300
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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 67% of NOR sales in 19Q2
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5,000
Accumulative design-win case count 4,467
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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16Q1 Q2 Q3 Q4 17Q1 Q2 Q3 Q4 18Q1 Q2 Q3 Q4 19Q1 Q2
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Copyright © Macronix International Co., Ltd.

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Business update – NOR flash breakdown (Parent Company)

NTD % NOR breakdown by density

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

Copyright © Macronix International Co., Ltd.

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Business update – NOR flash breakdown (Parent Company)

2019Q1 NOR revenue breakdown

2019Q2 NOR revenue breakdown

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Consumer, Comm,
18% 32%
Computer,
22%
Auto , 15%
I.M.A.,
13%
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Consumer, Comm,
19% 34%
Computer,
22% I.M.A., Auto , 13%
12%
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*** Comm:** including handsets

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

2019Q2 NOR revenue comparison

Computer +17% QoQ -18% YoY

Consumer Communication Automotive I.M.A +17% QoQ +20% QoQ -3% QoQ +0% QoQ -17% YoY +8% YoY -5% YoY -25% YoY

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Agenda

Welcome

Welcome C.Y. Lu 2019Q2 Financial Results Paul Yeh Business Update C.Y. Lu Remarks and Q&A C.Y. Lu

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