MERRY — Call Transcript 2017

Jul 25, 2017

Merry Electronics

2017 Second Quarter Earnings Conference

Presented by : Allen Huang Date : 2017.07.25

0

Safe Harbor Notice

Except for historical information contained herein, the matters set forth in this presentation are forward looking statements subject to significant risks and uncertainties that could cause actual results to differ materially, including the impact of competitive products and pricing strategies, whether the design is accepted by our customers timely, the prompt introduction of new technologies, the capability for mass production of new products, the risk of excess capacity, the availability of production capacity, the financial stability in terminal markets or other risks, and so on.

1

2017 Second Quarter Financial settlement (Unaudited)

2

Consolidated Statements of Comprehensive Income

(Unaudited)

(NT$ Thousand)

會計項目	2Q2017	1Q2017	2Q2016	QoQ	YoY
營業收入	5,368,400	4,515,000	3,674,999	+18.90%	+46.08%
毛利率	19.00%	19.67%	19.90%	-0.67ppt	-0.90ppt
營業費用	(425,829)	(394,051)	(423,656)	+8.06%	+0.51%
營業利益率	11.00%	10.94%	8.37%	+0.06ppt	+2.63ppts
業外收支	73,145	(97,049)	62,384	+74.37%	+17.25%
稅後淨利	540,317	319,243	319,380	+69.25%	+69.18%
純益率	10.00%	7.07%	8.69%	+2.93ppts	+1.31ppts
稅後每股盈餘	2.89	1.74	1.75	+66.09%	+65.14%

3

Proportion of the products revenue

==> picture [560 x 303] intentionally omitted <==

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

Battery Others
2% 1%
Handsfree
Speaker
2%
19%
Entertainment
Handsfree
Speaker
Entertainment
76% Battery
Others
----- End of picture text -----

4

(%)

Proportion of the products revenue

==> picture [656 x 322] intentionally omitted <==

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

Entertainment Speaker
YoY: 47.68% ; QoQ:25.57% YoY: 27.96% ; QoQ:6.52%
78% 21%
76% 20% 20%
76% 20%
74% 20%
72%
72% 19%
70% 19%
70% 19%
68% 18%
66% 18%
2Q2016 1Q2017 2Q2017 2Q2016 1Q2017 2Q2017
Handsfree Battery
YoY: -32.12% ; QoQ:21.21% 10% YoY: -12.63% ; QoQ:-65.12%
4% 3%
8%
3% 8%
3%
6%
2% 1% 2% 4%
2% 4%
2%
1%
2%
1%
0% 0%
2Q2016 1Q2017 2Q2017 2Q2016 1Q2017 2Q2017
----- End of picture text -----

5

(%)

Proportion of the products revenue

Entertainment

==> picture [503 x 312] intentionally omitted <==

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

YoY: 47.68% ; QoQ:25.57%
78% 76%
76%
74%
72%
72%
70%
70%
■ Wired/Entertainment 68%
■ Wireless/Entertainment 66%
2Q2016 1Q2017 2Q2017
2Q2016 1Q2017
29%
35%
65%
71%
----- End of picture text -----

==> picture [63 x 15] intentionally omitted <==

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

2Q2017
----- End of picture text -----

==> picture [136 x 137] intentionally omitted <==

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

25%
75%
----- End of picture text -----

6

(%)

Proportion of the products revenue

==> picture [310 x 156] intentionally omitted <==

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

Speaker
YoY: 27.96% ; QoQ:6.52%
21%
20% 20%
20%
20%
19%
19%
19%
18%
18%
2Q2016 1Q2017 2Q2017
----- End of picture text -----

==> picture [647 x 245] intentionally omitted <==

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

■ Other 19% 19%
■ NB&PC/Speaker Box
18%
■ Mobile/Speaker Box
18%
2Q2016 1Q2017 2Q2017
2Q2016
2Q2017
1Q2017
17%
12% 16%
13%
14%
53%
70% 35%
70%
----- End of picture text -----

7

Consolidated Gross Margin

25.00% 22.90% 22.35% 20.00% 19.90% 19.67% 19.00% 15.00% 10.00% 5.00% 0.00% 2Q2016 1Q2017 2Q2017 consolidated Suzhou,Huizhou Plant

8

Consolidated Operating Expenses

	424 426 million) YoY:0.51% ; QoQ:8.06%	424 426 million) YoY:0.51% ; QoQ:8.06%	424 426 million) YoY:0.51% ; QoQ:8.06%
	88 72 69 147 159 163 189 163 195 394

9

==> picture [594 x 305] intentionally omitted <==

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

( NT$ million) YoY:93.19% ; QoQ:20.31%
700 12.20%
10.94% 11.00%
600
8.37%
9.20%
500
400
6.20%
300 594
494
200
3.20%
308
100
0 0.20%
21Q2016 1Q2017 2Q2017
----- End of picture text -----

Consolidated Operating Income

Consolidated Operating Margin

10

Consolidated Net Income & Margin

==> picture [632 x 270] intentionally omitted <==

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

( NT$ million) YoY:69.18% ; QoQ:69.25%
600 12.00%
10.00%
500 8.69% 10.00%
400 7.07% 8.00%
300 6.00%
540
200 4.00%
319 319
100 2.00%
0 0.00%
2Q2016 1Q2017 2Q2017
----- End of picture text -----

Consolidated Net Income Consolidated Net Profit Margin

11

Consolidated Earnings Per Share

==> picture [555 x 276] intentionally omitted <==

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

( NT$ dollar)
3.5
2.89
3
2.5
2 1.75 1.74
1.5
1
0.5
0
2Q2016 1Q2017 2Q2017
每股盈餘 1.75 1.74 2.89
----- End of picture text -----

12

Key Information

• On 14 June 2017, the board resolutions of Merry Electronics Co. Ltd adopted acquisition of real estate.

• Name of Subject:

• (1)Land：No.82 , Fuxing section, Xindian Dist., New Taipei City.

• 、 、

• (2)Building：No.1792 1806 1818 and 1827, Fuxing section, Xindian Dist., New Taipei City.

• Area of Subject:

• (1)Land area：387.15 square meters.

• (2)Building area：2,910.58 square meters.

• The price: Three hundred and seventy million NT dollars only.

13

http://www.merry.com.tw

14