MERRY — Interim / Quarterly Report 2019

May 15, 2019

Merry Electronics Introduction and Q1 Operating Performance

Presented by : Allen Huang Date: May 13, 2019

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World-leading Electroacoustic Expert

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Vision Delivering Fidelity Sound to Enrich Human’s Life

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Mission To be a World-class Electro-Acoustic Solution Provider

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• Established in 1975

 Founders : Mr. Leo Liao / Mr. Jack Wei

• Service and Offering :

Wired & Wireless Headset , Speaker, Microphone, Battery, and Healthcare Related Product

 No. of Employee : 12,700(as of Dec. 2018)

• Global Footprint : 17 presences

• Market Cap. : US$ 1,107 Million(as of Mar. 2019)

• Year 2018 Revenue : US$ 1,156 Million

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Global Presence

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Functions
HQ | R&D | Sales | Mfg.
Taichung Hsinchu
Suzhou, China Xiamen, China
Taiwan 2018 New Zhangzhou, China
Taiwan Vaughan, Canada
(HQ) Members
Taipei Moss, Norway Taichung, Taiwan
Shenzhen Huizhou Suzhou Dongguan Thailand Singapore
Local
China Sales West /East Coast, USA
Office
Hong Kong, China
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*Strategic Corporation with Luxshare Group

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Strategic Partner

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MERRY
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• 100%

• • Shenzhen

• • Thailand

• • Taiwan (Btm)

• • Suzhou (Sonavox)

• • Norway (Sonavox)

• • Xiamen (AST)

• • Zhangzhou (AST)

Luxshare 49% 51% • Suzhou • Huizhou • Dongguan

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Key Milestones

1975-2000

2006-2010

2018-

• 1975 MERRY Founded

• 1989 Commenced Overseas Investment

• 2000 Publicly listed (TWSE)

• Awarded by Forbes (2005 & 2007)

• • Huizhou factory

• Dongguan factory

• • Awarded by Forbes • Acquired Sonavox (Note*)

• • Acquired AST Hearing • Acquired Biotest Medical[(FDA) ]

2000-2005

• Suzhou factory

• • Battery Product Line • Applied RF technology

2011-2017

• Won the iF/G-Mark Design Award

• • Thailand factory • Strategic cooperation with Luxshare Group

Note*: Acquired 3 companies from Sonavox Group: Sonavox Canada Inc. / SEAS Fabrikker AS /Suzhou United States Sound Electronics Co.

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Leading Technology

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Collaboration
Acoustic RF with
Universities
Good
Reputation
CORE
COMPETENCE
Research
0101010
New
1010101
Technology
Software Develop
Battery
New Product
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Product Lines

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Headset Speaker Microphone
Healthcare Battery
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ESG

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E nvironment

• Green Product Management

• Awarded the Certification of

“Hong Kong-Guangdong Cleaner Production Partners”

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S ocial

• Gender Equality Employment

• Awarded the prize of “Happy Workplace”

• Concentrate on talent cultivation

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G overnance

• Top 21%-35% of TWSE Corporate Governance Evaluation (868 listed companies)

• Information Disclosure regularly

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Consolidated Statements of Comprehensive Income (audited)

(NT$ Thousand)

會計項目	1Q2018	4Q2018	1Q2019	QoQ	YoY
Net Revenue	4,359,280	13,389,805	7,631,451	-43.01%	75.06%
Gross Profit	9.30%	14.46%	13.29%	-1.18pp	3.99pp
operating expenses	-452,619	-803,713	-652,011	-18.88%	44.05%
Operating Margin	-1.08%	8.46%	4.74%	-3.72pp	5.82pp
non-operating earnings	-47,238	448,818	166,624	-62.87%	452.73%
Net Income	-71,119	1,230,995	415,911	66.21%	684.81%
Net Profit Margin	-1.63%	9.19%	5.45%	-3.74pp	7.08pp
EPS(NT$)	-0.36	6.24	2.07	NT$ -4.17	NT$ 2.43

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Proportion of the Product Revenue

Speaker 27%

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Battery 2% Microphone 1% Healthcare 2.5% Others 1.5%

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(%)

Proportion of the Products Revenue

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Headset
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70%
65% 66%
QoQ: -35%
60% 58% YoY: 76%
■ Gaming
■ TWS 50%
■ Audio 1Q2018 4Q2018 1Q2019
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Proportion of the Products Revenue (%)

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Speaker
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40%
34%
35%
QoQ: -54%
30%
27% 27% YoY: 72%
■ Non-PC/NB
■ PC/NB 25%
■ SPK System 20%
1Q2018 4Q2018 1Q2019
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Proportion of the Products Revenue (%)

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Microphone
2.00% QoQ: 15%|YoY: 54%
1.04%
0.91%
1.00%
0.45%
0.00%
1Q2018 4Q2018 1Q2019
Healthcare Battery
6.00% QoQ: -66%|YoY: 14% QoQ: -53%|YoY: 36%
4.17%
4.00%
4.00%
2.79% 2.63%
2.49%
2.17%
2.00% 2.00%
0.29%
0.00% 0.00%
1Q2018 4Q2018 1Q2019 1Q2018 4Q2018 1Q2019
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