MERRY — Investor Presentation 2015

Dec 15, 2015

Merry Electronics Introduction

Presented by : Allen Huang Date :2015.12.14

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Overview

Merry is the World-leading Electro-acoustic Company

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Established since 1975 by Mr. Leo Liao / Mr. Jack Wei Service and Offering : Acoustic Component (Speaker and Microphone), Wired & Wireless Headphone, Headset and Speaker, Power Bank, Battery Pack, Assistive Listening Device Year 2014 Revenue : US$ 387 Million No. of Employee : 8,400 (as of Oct. 2015)

Global Footprint : 11 presences among Asia and U.S.A.

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Global Presence

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Functions
HQ
RD
Sales
Mfg.
HQ
Taichung Hsinchu Taipei Thailand
USA Singapore
Taiwan
Shenzhen Huizhou Suzhou
Hong
Shanghai
China
Kong
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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Positioning of Merry

Vision

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Delivering Fidelity Sound to Enrich Human’s Life

Mission

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To be a World-class Electro-Acoustic Solution Provider

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Key Milestones

2011 ~ 2015

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•
Won the IF Design Award / G-Mark Design Award
•
Thailand factory
2005 & 2007
•
Awarded as one of the Best 200 Asia Pacific
Enterprises by Forbes with
Revenue under 1 Billion 2010
•
Huizhou factory
2002 & 2003
•
Suzhou factory
• 2005
Battery Product Line
•
Acquired Huges Hi-Tech Inc.
1989 for RF technology
•
Shenzhen and
1998
Bangkok factory
•
Initial trading (IPO) on the OTC in Taiwan
1985
•
Taichung, Taiwan (Headquarter)
1975 Merry Electronics Founded
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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Product Evolution

2011 ~ 2015 Vast Advanced Products Offer

• •

• Wireless charging power bank Headset with OLED display/ NFC/ FM Radio

• •

• Ultra Dynamic Speaker for Wearable Device BT Portable Hi-Fi Speaker (NFC)

• •

• Hybrid Active Noise Cancelling Earphone Personal Sound Amplifier and

Hearing Protecting Earphone

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1975-1985

Dynamic Receiver for telephone Micro SPK for Walkman Headphone Dynamic Microphone for Radio Transceiver

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1986-2000

Speaker for NB Hands-free Headset for mobile phone Compact Receiver for mobile phone

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2001-2005

Battery Pack BT headset/ Car-Kit SMD Mic for Headset

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2006-2010

Power Bank BT PSS/Head Set Active Noise Cancelling Earphone

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Leading Technology

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Gaming / Entertainment Mobile
Acoustic
CORE
COMPETENCE
Acoustic
PC / Portable RF
Medical / Healthcare
Battery
Software
Wireless System
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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Product Overview – Accessory

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BT Stereo BT Speaker/
Headset/
Portable Speaker
Wireless
System
Headset
Headset /
Speaker System
Headphone
USB Headset /
ANC Earphone/
Sound bar
Portable Hand-free
Headset/ ALD
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• *. ANC: Active Noise Cancelling ; ALD: Assistive Listening Device

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Product Overview - Component

Providing Customized & Standardized Products

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MEMS MIC/
Speaker
Condenser MIC
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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Product Overview – Battery

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Power
Wireless
Charging Case
Universal
Battery
Power Pack
Pack
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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Consolidated Revenue

Million NT$

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Consolidated Revenue by Quarter

Million NT$

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4,000
2013
3,800 3,731 2014
2015
3,600
3,464
3,400 3,325
3,263
3,200
3,023
3,000 2,927
2,800 2,708
2,663
2,611
2,600
2,400
2,278
2,227
2,200
2,000
Q1 Q2 Q3 Q4
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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Net Income

Million NT$

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Net Income by Quarter

Million NT$

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480
2013
450 454
2014
420
398 2015
390
360
330
316
300
289
283
270 274
255
240
210
180
166
150
120
90 95
60 65
30 28
0
Q1 Q2 Q3 Q4
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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Revenue by Product Category

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Others,
Battery, Others,
Handsfree Battery, 2% Handsfree
8% 1%
, 16% 15% , 20%
Speaker,
26% Speaker,
22%
Entertainment
, 49% Entertainment
Y2014 , 41%
Y2013
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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Products Category by Quarter

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 Handsfree 27% 26% 20% 12% 16% 21% 13% 14% 13% 11% 6% Entertainment 23% 35% 43% 54% 42% 46% 54% 54% 49% 46% 61% Speaker 34% 16% 21% 20% 30% 24% 23% 26% 26% 28% 27% Battery 14% 21% 14% 13% 11% 8% 9% 5% 11% 14% 5% Others 2% 2% 2% 1% 1% 1% 1% 1% 1% 1% 1%
0%	2013Q1	2013Q2	2013Q3	2013Q4	2014Q1	2014Q2	2014Q3	2014Q4	2015Q1	2015Q2	2015Q3
Handsfree	27%	26%	20%	12%	16%	21%	13%	14%	13%	11%	6%
Entertainment	23%	35%	43%	54%	42%	46%	54%	54%	49%	46%	61%
Speaker	34%	16%	21%	20%	30%	24%	23%	26%	26%	28%	27%
Battery	14%	21%	14%	13%	11%	8%	9%	5%	11%	14%	5%
Others	2%	2%	2%	1%	1%	1%	1%	1%	1%	1%	1%

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Responsibility to CSR

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Recognizing our role in the society

Merry believes that corporate social responsibility is our mindset

Acoustic Education

• Support “Electro-Acoustic”

• graduate program

Social Care

• Sponsor "Taiwan’s March of

• Blessings" program by the Classical FM radio station since 2004.

• Donate Electro-acoustic Lab

• Fund charity concerts

• Found Merry Electro-acoustic

• Award

• Hold Electro-acoustic Seminar

• IBM Engineers Week

Environment Care

• Energy saving and carbon

• reduction

• Environmental protection

• and greening

• Volunteers for community

• service

Talent Cultivation

• Philanthropic Library

• “Philanthropic Library“

• Learning Symposium

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Taking the Lead with Merry

Forty Years of Track Record in Acoustic Industry Forty Years of Track Record in Acoustic Industry

Breadth of Product Solution (in Acoustic , RF, Battery & Software)

One-Stop Full Service (from Component to System Product )

Vertical Manufacturing Integration

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Financial Ratios

Unit：NTD/ Million

Item	2015/1-9	2014	2013	2012	2011	2010
Cash and cash equivalents Receivables Turnover Ratio(Days)	2,361 91.0	1,667 80.6	1,995 74.6	994 97.8	1,349 94.7	1,610 80.9
Payable Turnover Ratio(Days)	99.5	100.3	90.5	116.0	105.9	90.1
Days To Sell The Average Inventory	56.0	48.3	48.9	75.2	67.6	54.4
Operating Cycle	47.5	28.6	33.0	57.0	56.4	45.2
Book Value Per Share	$30.19	$32.71	$30.33	$27.15	$27.55	$27.85
ROE	**5.99% **	**21.83% **	**20.91% **	10.87%	**7.18% **	13.49%
ROA	**3.28% **	**12.86% **	12.36%	6.43%	4.22%	8.43%
Capex	710	969	459	466	486	302
Depreciation	237	284	277	235	228	237

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Consolidated profit comparison

Unit：NTD/ Million

Million NT$ 2015/1-9 2014 2013 2012 2011	Million NT$ 2015/1-9 2014 2013 2012 2011	Million NT$ 2015/1-9 2014 2013 2012 2011	Million NT$ 2015/1-9 2014 2013 2012 2011	Million NT$ 2015/1-9 2014 2013 2012 2011
	2014	2013	2012	2011
Consolidated Revenue 8,645	12,316	11,258	7,690	7,843
Grossprofit 1,583	2,972	2,485	1,460	1,203
Operating income 413	1,439	1,308	434	234
Pre-taxprofit 429	1,559	1,276	587	362
Net income 348	1,244	1,031	481	315
Grossprofit % 18.31%	24.13%	22.07%	18.99%	15.35%
Operating income % 4.77% Earnings per share(Dollar) NT$1.88	11.68%	11.62%	5.64%	2.99%
	NT$6.72	NT$5.86	NT$2.90	NT$2.00

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The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

Thank you

The information contained herein is the proprietary intellectual property of Merry Electronics and shall not be distributed, reproduced, or disclosed in whole or in part without prior written permission from Merry

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