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RECHI — Investor Presentation 2016
Sep 1, 2016
52399_rns_2016-09-01_e747b688-37f1-472c-9408-d1da31571a4d.pdf
Investor Presentation
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Investor Conference
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Agenda
1. Company Introduction
2. Financial Highlights
3. Market Opportunity and Competitive Advantage
4. Future Prospects
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Company Introduction
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Main shareholders
SAMPO Corporation 27.03% China Steel Corporation 4.91% Sharp Corporation 4.86% Porite Taiwan Co., Ltd 2.09% National Electric Appliance Co., Ltd 1.71%
Data as of June 2, 2016
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Organization structure
RECHI PRECISION CO., LTD
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100% 100% 45%
Rechi Investments
RechiHoldings Co., Ltd. Dyna Rechi Co., Ltd.
Co., Ltd.
100%
100% 100%
100% RechiInternational Rechi Investments Holdings 77.78% 100% Dyna RechiHoldings Co., Ltd.
Holdings Co., Ltd. Co., Ltd.
100% 100% 100%
Rechi TCL Rechi (Huizhou) Rechi Precision(Jiujiang)
Dongguan Rechi GR Holdings Dyna Rechi Jiujiang Co.,
Precision(Qingdao)Elect Refrigeration Equipment Electric Machinery
Compressor Co., Ltd. (Hong Kong) Limited ric Machinery Limited Company Limited Limited Ltd.
100% 50% 50% 67.86% 25%
Qingdao Rechi Rechi Precision
Rechi Refrigeration
Electric Machinery (Huizhou)Mechanism
Dongguan Co. Ltd.
Sales Company Company
5
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Location of facilities
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Cover area: 151,016m [2] Cover area : 29,652m [2]
Qingdao factory: compressor Kwanyin factory: HQ and R&D center
QR KR
Cover area: 298,149m [2]
JR/DRJ
America Office
India Office
DC compressor and BLDC motor
HR DNR
TR
Cover area: 20,000m [2]
Cover area : 34,194m [2] 占地面積: 160,000m [2]
Huizhou factory: compressor Humen factory: compressor and motor Pingtung factory: BLDC motor
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RECHI milestone
2020
2016
Target：Accumulative Sales Quantity reached 200 million sets.
Accumulative Quantity of July 31, 2016 Sales：129,538,887 sets Production ：130,675,435 sets
2014
2011
Accumulative Sales Quantity reached 100 million sets.
2020
2016
Annual Sales Quantity exceed 10million sets.
2013
2014
2015
2011
Developed 39F with R290 Application
Developed 20F/28F DC Compressor with R134a Application
2006
R Project with ITRI
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Developed 44F / 50F with R32 Application
1989
Developed 44F DC Compressor with R410A Application
Developed 39F with R134a and R410a Application
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Financial Highlights
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RECHI Sales : Geographic distribution
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Europe
28%
China
N American Japan
13%
24% Middle East 5%
2%
Taiwan
India
3%
2%
SE Asia
S American
15%
8%
data statistics : 2015
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The sales quantity of Heat-Pump Dryer compressor
★ Market Share: more than 80% in Europe
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(Unit: 10k)
300
250 233
196
200
150 131
106
100
75
46
50
0
'10 '11 '12 '13 '14 '15 '16(F) '17(F) '18(F) '19(F)
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Revenue growth
(Unit: NT$mn)
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Margins
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ROE and ROA
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Operating CF & CAPEX
(Unit: NT$mn)
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Dividend policy
| 2011 | 2012 | 2013 | 2014 | 2015 | |
|---|---|---|---|---|---|
| EPS (NT$) | 2.03 | 2.21 | 2.02 | 2.30 | 1.86 |
| Stock DPS (NT$) | 0.3 | 0.3 | 0.3 | - | - |
| Cash DPS (NT$) | 1.2 | 1.5 | 1.5 | 2 | 1.6 |
| Payout ratio (%) | 59.1 | 67.9 | 74.3 | 87 | 86 |
| Cash yield (%)* | 5.1 | 5.6 | 5.1 | 8.6 | 6.2 |
- Based on share price on following year closing before ex-dividend day
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Income statement
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Balance sheet
| Unit in Thousand NT$ | 2016H1 | ％ | 2015H1 | ％ | YoY | % |
|---|---|---|---|---|---|---|
| Cash and equivalents | 3,098,466 | 15 | 4,222,599 | 19 | -1,124,133 | -27 |
| Accounts receivable,net | 3,449,333 | 16 | 4,062,194 | 18 | -612,861 | -15 |
| Inventories | 1,765,102 | 8 | 1,793,366 | 8 | -28,264 | -2 |
| Property,plant and equipment,net | 5,994,509 | 28 | 5,776,715 | 26 | 217,794 | 4 |
| Total assets | 21,088,180 | 100 | 22,338,752 | 100 | -1,250,572 | -6 |
| Total current liabilities | 10,069,208 | 48 | 10,944,819 | 49 | -875,611 | -8 |
| Long-term liabilities | 251,028 | 1 | 925,800 | 4 | -674,772 | -73 |
| Total liabilities | 12,054,624 | 57 | 12,852,982 | 58 | -798,358 | -6 |
| Total stockholders' equity | 9,033,556 | 43 | 9,485,770 | 42 | -452,214 | -5 |
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Cash flow statement
Unit in Thousand NT$ 2016H1 2015H1 Cash, beginning of year 4,242,008 4,598,024 Net cash provided by opera 640,519 526,567 Cash flow from investment -362,347 -1,271,210 (Decrease) increase in short-te -644,096 425,486 (Decrease) increase in long-te -72,853 0 others -704,765 -56,268 Cash, end of year 3,098,466 4,222,599
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Market Opportunity and Competitive Advantage
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Global A/C market trend
(Unit: 10k)
RY : August-July
Reference : IOL, HENGTA, GI
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China top 10 A/C makers
(Unit: 10k)
| Maker | 2016年 (H1) |
Growth (H1) |
2015 | Growth | 2014 | Growth | 2013 | Growth | 2012 |
|---|---|---|---|---|---|---|---|---|---|
| GREE | 1572 | -23.6% | 3620 | -7.8% | 3927 | 2.0% | 3851 | 3.1% | 3734 |
| MIDEA | 1383 | -27.3% | 2712 | -6.7% | 2906 | 8.3% | 2684 | 11.0% | 2419 |
| HAIER | 416 | -13.4% | 754 | -13.3% | 869 | 2.3% | 850 | 14.1% | 745 |
| CHIGO | 349 | 5.2% | 495 | -8.2% | 539 | -1.1% | 546 | 13.6% | 480 |
| AUX | 420 | 45.9% | 479 | 8.5% | 441 | 5.8% | 417 | -2.0% | 425 |
| TCL | 394 | 25.2% | 465 | -4.6% | 487 | 11.3% | 438 | 23.8% | 354 |
| HISENSE | 188 | -8.6% | 309 | -16.2% | 369 | 11.9% | 330 | 16.9% | 282 |
| LG | 146 | -28.7% | 258 | -4.1% | 270 | -12.6% | 309 | -7.5% | 333 |
| PANASONIC | 133 | -24.6% | 253 | -11.2% | 285 | 1.4% | 281 | -25.8% | 379 |
| CHANGHONG | 172 | 14.3% | 220 | 3.7% | 212 | 8.8% | 195 | 15.6% | 168 |
| OTHERS | 624 | -6.8% | 1091 | -16.2% | 1302 | 7.2% | 1214 | 11.0% | 1094 |
| TOTAL | 5796 | -14.5% | 10655 | -8.2% | 11606 | 4.5% | 11112 | 6.7% | 10412 |
Reference : IOL
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China top 10 rotary compressor makers
(Unit: 10k)
| Maker | 2016年 (H1) |
Growth (H1) |
2015 | Growth | 2014 | Growth | 2013 | Growth | 2012 |
|---|---|---|---|---|---|---|---|---|---|
| GMCC | 2740 | -5.4% | 4241 | -3.8% | 4408 | 25.9% | 3502 | 35.1% | 2593 |
| LANDA | 1305 | -16.6% | 3055 | -15.4% | 3613 | 32.8% | 2721 | 14.3% | 2381 |
| HIGHLY | 1005 | 9.0% | 1511 | -16.5% | 1811 | 9.7% | 1650 | 7.1% | 1540 |
| RECHI | 771 | 13.3% | 1238 | -8.4% | 1351 | 9.3% | 1236 | 13.0% | 1094 |
| PANASONIC | 492 | -8.6% | 887 | -19.4% | 1101 | 6.5% | 1034 | -5.1% | 1089 |
| LG | 373 | 4.7% | 554 | -11.8% | 628 | 9.4% | 574 | -17.6% | 697 |
| MITSUBISHI | 335 | 1.5% | 545 | -11.8% | 618 | 13.4% | 545 | 2.8% | 530 |
| SAMSUNG | 217 | 6.9% | 320 | -31.3% | 466 | -4.1% | 486 | -1.0% | 491 |
| QINGAN | 175 | 10.4% | 320 | -23.2% | 416 | 8.0% | 385 | -35.8% | 600 |
| SANYO | 157 | 14.1% | 239 | -16.9% | 287 | -23.1% | 374 | 2.0% | 366 |
| OTHERS | 232 | -4.7% | 452 | -18.3% | 553 | 14.7% | 482 | 36.2% | 354 |
| TOTAL | 7802 | -2.9% | 13362 | -12.4% | 15252 | 17.4% | 12989 | 10.7% | 11736 |
Reference : IOL
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Competitive advantage-marketing
★ Owns complete global marketing channels
service 28 countries， 148 Clients
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Competitive advantage - production
★Excellent Manufacturing technology and efficiency
★More cost effective
- ★High product performance
-RECHI products was deeply trusted by DAIKIN, MIELE and so on.
Jiujiang factory( DynaRechi)
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Preliminary capacity 2 million
Qingdao factory
compressor
Final capacity 6 million compressor 9 million
BLDC motor Preliminary capacity 1.5 million pump 6 million
Final capacity 21 million motor 6 million
Qingdao
Huizhou factory
Kuanyin factory
( TCL Rechi)
compressor 6 million Jiujiang pump 3 million
pump 6 million Taoyuan
motor 3.6 million Huizhou
Humen
Pingtung factory
Humen factory Pingtung BLDC Preliminary capacity 1.5 million
motor 5 million motor Final capacity 3 million
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Competitive advantage - products
High energy-efficiency Less noise
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Energy Efficiency Standards
- ★ A/C and Dehumidifier Energy Star in USA
※Flow induced noise analysis and design
- ★TAIWAN CSPF and CHINA class 1
※Structure modal analysis and design
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- ★ A /C Five Star Standards in INDIA
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※Acoustic analysis and design
- ★Pump dryer in EUROPE A+++ -20%
※Optimal Muffler design
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A/C 3.5kW application
Split A/C , VRF
Heat Pump dryer
62%
Weight Dish Washer
50/60 Hz
Unitary A/C Heat Pump Water Heater Dehumidifier
Inverter high Roof-Top A/C
frequence
Tumbling-box
15~120 r.p.s. Smaller size Application Portable A/C Washing Machine
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Competitive advantage – R&D capability
- ★Professional R&D Team： average more than 7years of experience(Master and PHD 33%)
、 ★High precision test device and laboratory：Calorimeter26 sets Vibration & 、 、 noise test chamber 11 sets Reliability test lab 18 sets Locked-rotor test lab 14 sets.
-
、 、 、 、 、
-
★Industry-university cooperative：ITRI NCSIST NIRDC NCTU NCU 、 、
-
NCKU NIIC NPUST and so on.
| Year R&D Engineer % 2015 305 5.7% 2014 275 5.3% 2013 242 4.3% 2012 157 3.2% 2011 113 2.3% 2010 95 2.2% 2009 81 2.0% 2008 78 3.3% |
292,680 420,020 467,373 1.09% 1.40% 0.93% 0.93% 1.31% 1.78% 2.32% 2.99% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 '08 '09 '10 '11 '12 '13 '14 '15 R&D Expense R&D vs. Revenue (Unit: NT$k) 24 |
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Future Prospects
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Development strategy
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Create
Pursue
New Energy
Saving market
opportunity
Value
Technology Market
Innovation
Innovation Demand
Strategy
New Energy
Saving products
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Mid-term and long-term plan - sales
Compressor BLDC Motor
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Target：Accumulative
(Unit: 10k) (Unit: 10k)
Sales Quantity reached
2,500
200 million sets.
2,000
1,500
1,000
500
-
'12 '13 '14 '15 '16(F) '17(F) '18(F) '19(F) '20(F)
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Mid-term and long-term plan - sales Other business
2020 target revenue 7.5%
★Builds leader brand ★Develops new markets in Taiwan market for compressor motor ★Horizontal alliances Compressor Heat Pump ★Develops oversea market motor Water Heater business business Precision Module ★Develops ★Builds module business machining Automobile parts products channels business precision machining -Compressor products -BLDC motor products ★Develops innovation precision machining products
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Mid-term and long-term plan - production capacity
-
★Raise production capacity quickly in Jiujiang factory
-
★Become Intelligence factory
-
★Builds module products lines in KR
-
★The key area in the future - INDEA
Compressor
BLDC Motor
(Unit: 10k)
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(Unit: 10k)
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Mid-Term and Long-Term plan - product development
Develops VRF compressor
Develops compressor for 3rd generation of refrigerant
Develops mini compressor Develops BLDC motor (for A/C) series Develops BLDC motor (for non A/C) Develops Subversive innovation end products and module products
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Upgrades RECHI management systems
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Raise company's competitiveness
Organization improvement
process and Intelligence system factory improvement
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Thank you
Create unlimited possibilities for the Energy Saving Industry. Become the top provider of proactive Energy Saving Product.
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