AI assistant
Qisda Interim / Quarterly Report 2021
52023_rns_2021-11-17_709aaf31-7994-47ef-997f-be9b9d98e9d9.pdf
Interim / Quarterly Report
Open in viewerOpens in your device viewer
Qisda Corporation Investor Conference: 2021 Q3 Results
November 17, 2021
Participants
Chairman Peter Chen CFO Jasmin Hung GM, Information Technology Business Group Commercial and Industrial Business GM, Medical Devices Business Group Harry Yang GM, Business Solutions Group Michael Lee GM, Networking and Communication Business Group April Huang Joe Huang
Agenda
1. Company Profile
CFO Jasmin Hung
- 2. 2021 Q3 Financial Results
- 3. Business Update and Outlook Chairman Peter Chen
- 4. Summary of Business Solutions Group (BSG) GM of BSG Michael Lee
- 4. Q&A
Safe Harbor Notice
We have made forward-looking statements in the presentation. Our forward-looking statements contain information regarding, among other things, our financial conditions, future expansion plans and business strategies. We have based these forward-looking statements on our current expectations and projections about future events. Although we believe that these expectations and projections are reasonable, such forward-looking statements are inherently subject to risks, uncertainties, and assumptions about us.
We undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events might not occur and our actual results could differ materially from those anticipated in these forward-looking statements.
1. Company Profile
Qisda Group
Qisda is a global technology group with businesses spanning information and communication, medical, smart business solutions, and networking communication.
| Established Year | 1984 | Global Presence | 2021 Three Quarters Revenue NTD\$164.1B (USD\$ 5.8B) |
|---|---|---|---|
| IPO Year (Ticker 2352) |
1996 | Manufacture Sites:Taiwan, China, Vietnam |
2020 Revenue |
| Capital (NTD) | 19.7B | Sales Offices:198 Locations Worldwide |
NTD\$191.7B (USD\$ 6.5B) Awards |
| Consolidated Companies | 194 | R&D:Taiwan, China | 2021 Forbes: " World's Best Employer 2021 " |
| Revenue Breakdown by Geography (2021) | 2021 HR Asia: |
||
| Listed Companies (Taiwan) | 15 | Asia 46% |
" Best Companies to Work For 2021 " |
| Americas 31% |
" Most Caring Companies 2021 " | ||
| No. of Employees | 33,000+ | Europe 21% |
2021 Winning |
| Others 2% |
" Taiwan Corporate Sustainability Awards (TCSA) " |
Results of Qisda Group's ESG Practices
- ◆ Named a Forbes "World's Best Employer 2021".
- ◆ A recipient of HR Asia's "Best Companies to Work For 2021" Award:
- ➢ Qisda Corporation: "Best Companies to Work For" Award for three years consecutively and "Most Caring Companies" Award for two years in a row.
- ➢ BenQ Materials Corporation: First time winning "Best Companies to Work For"
◆ Eight Taiwan Corporate Sustainability Awards:
➢ Qisda Corporation:
Sustainable Individual Performance-Social Inclusion Leadership Award
Corporate Sustainability Reports Award-Electronic Information Manufacturing Industry - Gold Award
Taiwan Sustainability Action Award-Decent Work And Economic Growth - Sliver Award
Taiwan Sustainability Action Award-Quality Education - Copper Award
Sustainability Comprehensive Performance-Sustainability Comprehensive Performance Award
➢ BenQ Materials Corporation:
Corporate Sustainability Reports Award-Electronic Information Manufacturing Industry - Sliver Award
Taiwan Sustainability Action Award-Clean Water And Sanitation - Copper Award
➢ TopView Optronics Corporation:
Corporate Sustainability Reports Award-Electronic Information Manufacturing Industry - Sliver Award
| Business Groups | 2352 | ||||
|---|---|---|---|---|---|
| ICT Information & Communication Technology (61%) Revenue (NTD) |
MEDICAL (7%) |
BSG Business Solutions (13%) |
NCG Networking & Communication (13%) |
OTHERS (6%) |
|
| 99.5 B till 2021Q3 ➢ Displays 43% • Gaming • High-end • General ➢ Projectors 5% ➢ ICT - others 5% |
11.9 B ➢ Medical Services • BenQ Medical Center in Nanjing and Suzhou ➢ Equipment & Consumables • Operating Table, Surgical Light • Ultrasound • Intraoral Scanner |
20.5 B ➢ Smart Hospital ➢ Smart Factory ➢ Smart Retail ➢ Smart Energy ➢ Smart Enterprise ➢ Smart Campus |
21.5 B ➢ LAN/MAN • Data Switch ➢ Wireless Broadband • Small Cell • Wireless Router ➢ Digital Multimedia • IP Camera ➢ Enterprise Mobile |
10.7 B ➢ Material • Functional Film • Advanced Battery Materials ➢ Other products INVESTMENT |
|
| ➢ ICT - HVA 8% • Prof. Display Module ➢ • Integration Solutions • High-end Video Survillance |
• Hearing Aids • Dentistry Consumables Qflux Dialyzer • Dialysis Equipment & Consumables • Ethanol Solution |
Solutions • mmWave Radar |
➢ AUO (FVOCI) ➢ Darfon (Equity method) |
8
2. 2021 Q3 Financial Results
9
2021 Q3 Highlights
- ◆ First three quarters revenue, operating income and net income attributable to Qisda were all highest in the same period in 10 years. EPS 3.72 higher than any single year in 10 years
- Growth on YoY basis: Revenue 22%, operating income 24% and net income attributable to Qisda 127%
- Return on Equity (ROE) achieved 15%
- ◆ Q3 revenue grew 11% on YoY basis
- Medical and BSG revenue grew at a double-digit rate: Medical grew by 23% and BSG grew by 22%.
- ICT revenue grew by 9%:
- ✓ Increased demand in business applications
- ✓ ICT high value-added product (ICT_HVA) increase revenue contribution as the result of Qisda's effort in self-development and acquisitions in recent years
- NCG revenue contribution remained at the same level: Mainly due to shortage of materials, shipping containers as well as port congestion.
- ◆ Starting from May 2021, Qisda no longer need to book investment gain/loss from AUO based on shareholding percentages as it is changed to Fair Value through Other Comprehensive Income (FVOCI) from equity method. Fluctuation in AUO's earnings will not affect Qisda's EPS.
Cash dividends from AUO will be booked as our non-operating income: dividend income.
Consolidated Statement of Comprehensive Income (Quarterly)
Unit : NT\$ Million
| 2021 Q3 |
2020 Q3 |
YoY | 2021 Q2 |
QoQ | ||
|---|---|---|---|---|---|---|
| g% amt |
g% amt |
|||||
| Net Sales |
57 201 100% , |
51 695 100% , |
5 507 11% , |
55 984 100% , |
1 217 2% , |
|
| Cost of Goods Sold |
(48 885) , |
(44 211) , |
(4 674) , |
(47 725) , |
(1 161) , |
|
| Gross Margin |
8 316 14 5% , |
7 483 14 5% , |
832 11% |
8 259 14 8% , |
57 1% |
|
| Operating Expenses |
(6 334) 1% 11 - , |
(5 433) 10 5% - , |
(901) | (6 352) 3% 11 - , |
18 | |
| Operating Income |
1 982 3 5% , |
2 051 4 0% , |
(69) 3% - |
1 907 3 4% , |
75 4% |
|
| Net Income non-operating |
566 | 901 | (335) | 3 388 , |
(2 822) , |
|
| Profit(Loss) before Tax |
2 548 4 5% , |
2 951 7% 5 , |
(404) 14% - |
5 295 9 5% , |
(2 747) 52% - , |
|
| Net Income |
954 1 3 4% , |
2 478 4 8% , |
(525) 21% - |
4 388 7 8% , |
(2 434) 55% - , |
|
| income attributable Qisda Net to |
395 1 2 4% , |
2 046 4 0% , |
(651) 32% - |
3 805 6 8% , |
(2 410) 63% - , |
|
| EPS (NT\$) (a) |
\$0 71 |
\$1 04 |
\$0 33 - |
\$1 93 |
\$1 23 - |
11 (a) EPS was calculated based on total weighted-averaged outstanding shares (1,967 m shares)
Consolidated Statement of Comprehensive Income (YTD)
Unit : NT\$ Million
| First three 2021 Q3 quarters of 2021 |
First three 2020 Q3 quarters of 2020 |
g% amt |
|
|---|---|---|---|
| Sales Net |
164 089 100% , |
134 567 100% , |
29 521 22% , |
| Cost of Goods Sold |
(140 013) , |
(115 891) , |
(24 122) , |
| Gross Margin |
24 075 14 7% , |
18 677 13 9% , |
399 5 29% , |
| Operating Expenses |
(18 469) 3% 11 - , |
(14 154) 10 5% - , |
(4 315) , |
| Operating Income |
5 607 3 4% , |
4 522 3 4% , |
1 084 24% , |
| Net Income non-operating |
5 368 , |
895 | 4 473 , |
| Profit(Loss) before Tax |
10 975 6 7% , |
5 418 4 0% , |
5 557 103% , |
| Net Income |
8 950 5 5% , |
4 082 3 0% , |
4 868 119% , |
| income attributable Qisda Net to |
312 7 4 5% , |
3 227 2 4% , |
4 085 127% , |
| EPS (NT\$) (a) |
\$3 72 |
\$1 64 |
\$2 08 |
| YTD YoY |
||||||
|---|---|---|---|---|---|---|
| amt | g% | |||||
(a) EPS was calculated based on total weighted-averaged outstanding shares (1,967 m shares)
Revenue and Operating Income
- ⚫ First three quarters revenue and operating income reached record high in 10 years, YoY grew at a double-digit rate: Revenue increased 22%, operating income increased 24%
- ⚫ Q3 revenue NTD 57.2 billion, YoY grew 11%; Rising material and expenses are the main reasons for the slight decline in operating income
Gross Margin and EPS (Yearly)
- ⚫ First three quarters gross margin 14.7%, increase by 2.8 ppt in 5 years.
- ⚫ First three quarters EPS reached \$3.72, higher than any single year in 10 years.
Consolidated Balance Sheet Highlights
Unit : NT\$ Million
| 2021 09 30 |
2021 06 30 |
QoQ | 2020 09 30 |
YoY | ||||||
|---|---|---|---|---|---|---|---|---|---|---|
| g% amt |
amt | g% | ||||||||
| Cash & Equivalent |
16 830 , |
9% | 21 234 , |
12% | 4 404 - , |
-21% | 17 903 , |
11% | 1 072 - , |
-6% |
| Accounts Receivable |
33 731 , |
19% | 33 041 , |
18% | 690 | 2% | 35 931 , |
22% | 2 200 - , |
-6% |
| Inventory | 47 994 , |
27% | 42 008 , |
23% | 5 987 , |
14% | 32 711 , |
20% | 15 283 , |
47% |
| L T Investments - |
3 321 , |
2% | 3 276 , |
2% | 45 | 1% | 15 318 , |
9% | 11 998 - , |
-78% |
| Financial fair value assets at |
||||||||||
| through other comprehensive |
14 069 , |
8% | 17 466 , |
10% | 3 398 - , |
-19% | 1 433 , |
1% | 12 636 , |
882% |
| income –non-current |
||||||||||
| Total Assets |
181 017 , |
100% | 182 913 , |
100% | 1 896 - , |
-1% | 161 981 , |
100% | 19 036 , |
12% |
| Fin * Debt |
069 57 , |
32% | 50 557 , |
28% | 6 512 , |
13% | 42 305 , |
26% | 14 763 , |
35% |
| Accounts Payable |
38 547 , |
21% | 40 175 , |
22% | 629 1 - , |
-4% | 36 264 , |
22% | 2 283 , |
6% |
| Liabilities Toal |
121 661 , |
67% | 121 507 , |
66% | 154 | 0% | 102 972 , |
64% | 18 689 , |
18% |
| Equity | 59 357 , |
33% | 61 406 , |
34% | 2 050 - , |
-3% | 59 009 , |
36% | 348 | 1% |
Key Financial Ratios
| 2021 09 30 |
2021 06 30 |
QoQ | 2020 09 30 |
YoY | ||
|---|---|---|---|---|---|---|
| (Days) (Incl. Factoring) AR Turnover |
76 | 77 | 1 - |
85 | 9 - |
|
| Inventory Turnover (Days) |
81 | 77 | +4 | 72 | +9 | |
| AP Turnover (Days) |
77 | 81 | 4 - |
79 | 2 - |
|
| Cash Conversion Cycle (Days) |
80 | 73 | +7 | 78 | +2 | |
| Current ratio |
120% | 121% | 1 ppt - |
121% | 1 ppt - |
|
| Fin / Debt Total Assets |
32% | 28% | +4 ppt |
26% | +6 ppt |
|
Return on equity 15.1%
Revenue Breakdown by Business (Quarterly)
*ICT_Projector: Projectors *ICT_Monitor: Monitors
* Materials and Others: BenQ Materials and other products * NCG:Networking and Communication * BSG:Business Solutions Group * Medical:medical service, equipment and consumable * ICT:ICT products *ICT_HVA: prof. display modules, integrated solutions, high-end video surveillance *ICT_Other: other ICT products
Revenue Breakdown by Business (Yearly)
- Medical, BSG and NCG account for 33% of total revenue and increase by 22 percentage points since 2017.
- Aggressively optimizing ICT high value-added product (ICT_HVA) product portfolio, account for 8% of total revenue and increase by 3 percentage points since 2017.
- Monitors revenue grew steadily and its weight on total revenue decrease to 43% from 59% as the result of increase in high value-added product portfolio.
3. Business Update and Outlook
Chairman Peter
Qisda's Vision
High value-added business will account for
more than half of the revenue by 2022
Qisda's Winning Strategy
Current Business Optimization
ICT Products ( WW2 in Monitor, WW1 in DLP Projector, Others )
5G Network Business Strategic Placement
Comprehensive broadband solutions
Major
Pillars
Fast Expansion for Medical Businesses
Medical Service, Equipment & Consumables
Acceleration on Solution Development
Smart Solutions ( Hospital, Factory, Retail, Energy, Enterprise, Campus )
2021 Q4 Outlook
✓ Business Drivers
- Medical business to maintain high growth: Hospital business growing steadily, with increasing supplies of infection prevention products.
- In-depth expansion of Business Solutions Group: Enhance cloud and digital transformation services to provide high value-added services.
- Q4 is traditionally a peak season for ICT products, with demand remaining at a high level.
✓ Cautious Measure in the Face of Global Economic Uncertainties
- Pandemic-related impact: While the vaccine penetration rate increases and countries increasingly lift lockdown restrictions, variants of the virus still significantly affect many countries' economies.
- Supply and demand: The supply chain still face challenges such as shortage in materials and cargo capacity, port congestion, power cuts in China, rising interest rates, inflation and its impact on products price and consumer spending need to be observed.
4. Summary of Business Solutions Group
GM, Business Solutions Group Michael Lee
Qisda BSG
Business Solutions Group
- 4,000+ employees worldwide
- 50+ sales/manufacturing sites
- \$1B (USD) revenue scale
- Vertical integration from components to total solution ITG BSG
Qisda Business Solution Group(BSG)
BSG產品與服務
Solution Integration
Global Market Penetration
