SUNKO — Investor Presentation 2019

Sep 12, 2019

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SUNKO INK CO., LTD [Index: 1721]

Investor Conference 12 Sept. 2019

Disclaimer

The information in this presentation and the contents under discussion are based on existing information, in which we stated with regard to financial and relevant information may include some of Company’s forward-looking statements. Such statements involved may be easily affected by significant risks and uncertainties which lead to the different consequence from those statements. The Company does not undertake any obligation to update any forwardlooking statement as a result of new information, future events or otherwise. The purpose of the contents as presented is for information circulation only, not for investment proposal.

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Company Profile

Product: Fine Chemicals, Agrochemicals, Polymer Start up: Year 1974 Employees: 571 (as at 30 June 2019) Capital: $2,241 millions Revenues: $3,452 millions for FY2018

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Main Products

◆ Agrochemicals ◆ Fine Chemicals ◆ Polymer

Agrochemicals

◆ Bendiocarb

◆ Formetanate ◆ Methomyl ◆ Carbaryl ◆ Carbofuran ◆ Carbosulfan

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Fine Chemicals Antioxidant

Prevents thermal oxidative degradation of plastics and rubbers.

◆ K-NOX 168

◆ K-NOX 148

◆ K-NOX 230

◆ K-NOX 57

◆ K-NOX 1520 ◆ K-NOX 1726 ◆ K-NOX 565 ◆ K-NOX 412S

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Fine Chemicals Non-halogenated Flame Retardant

Reaction with flame retardant, the epoxy resin has relatively high glass transition temperature, good flame retardancy, and thermal stability

• DOPO

• SPS

Fine Chemicals Curing Agent A raw material for golf ball core.

◆ K-CURE 339

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Fine Chemicals Reducing Agent

In Black Oxide process, DMAB prevents“pink ring”defects in laterstage acid treatment by reducing CuO layer to Cu2O, while enhancing the resin bonding of surface texture.

◆ K-MARS 110

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Fine Chemicals Clarifying Agent An additive to polypropylene (PP), Clarifying Agent can increase transparency and rigidity of polypropylene products.

• K-CLEAR 34

• K-CLEAR 34i

• K-CLEAR 34N1

• K-CLEAR 40

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Polymer TPU、TPV

Application : Footwear、Textile、Adhesive Construction Materials、Car Materials Plastics processing.

• URELON® TPU

• KUOTANE® TPU

• Elastoplas® TPV

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Polymer-PU

◆ PU Adhesives ◆ PU Glazing Agent ◆ PU Matting Agent

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Statement of Comprehensive Income

In Thousands of TWD or Otherwise stated

		1st Half of 2019	1st Half of 2018	YOY Variance
	Revenues	1,626,839	1,721,818	-5.52%
	Cost of Goods Sold	(1,478,535)	(1,616,823)
	Gross Margin	148,304	104,995	41.25%
	Margin %	9.12%	6.10%
	Operating Expenses	(130,542)	(138,361)
	Operating Profit (Loss)	17,762	(33,366)
	Non-operating Profit	1,238	26,824
	EBT	19,000	(6,542)
	Income After Tax	15,725	395
	EPS (in Dollar)	0.07	-

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Products Mix
1 [st] Half of 2019 1 [st] Half of 2018
Clarifying Agent
Clarifying Agent
3% Others
4% Others
6%
9%
Curing Agent
7%
Curing Agent
7%
Reducing Agent Antioxidant Antioxidant
7% 38% 37%
Reducing Agent
7%
Agrochemicals
Agrochemicals
14%
11%
Non-halogenated Non-halogenated
Flame Retardant Flame Retardant
Polymer Polymer
11% 9%
14% 16%
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In Thousands of TWD
Others, 99,003
Clarifying Agent, 43,046
Curing Agent, 109,364
1st Half of Reducing Agent, 119,219
2019 Agrochemicals, 231,284
Non-halogenated Flame Retardant, 180,291
Polymer, 221,369
Antioxidant, 623,263
Others, 158,645
Clarifying Agent, 65,953
Curing Agent, 113,447
1st Half of Reducing Agent, 114,202
2018 Agrochemicals, 197,888
Non-halogenated Flame Retardant, 150,376
Polymer, 275,341
Antioxidant, 645,966
0 100,000 200,000 300,000 400,000 500,000 600,000 700,000
Others Clarifying Agent Curing Agent Reducing Agent Agrochemicals Non-halogenated Flame Retardant Polymer Antioxidant
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In Thousands of TWD
Revenues Margin
Margin analysis
1,626,838
1st Half of 2019
• Margin increased from 6.10%
to 9.12%。 148,304
• Moderating raw material
prices。
• Improved product mix。
1,721,818
1st Half of 2018
104,995
0 500,000 1,000,000 1,500,000 2,000,000
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Market Situation and Outlook

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Challenges and Strategies

Challen es g

Strate ies g

Market Competitions : Having advantage in raw materials and capacity, Chinese manufacturers are dumping generic products in global market, eroding Sunko's market share.

The more “tailor-made” products, the greater customers retention is.

Raw Material Cost Increase : Due to EHS issues, there has been shortages in raw materials coming out of China, which also resulted in price hike.

Seek alternative sources, especially from nonChina suppliers.

Environmental Issues : Tougher rules and regulation on pollutions and labor.

Increase expenditure on EHS control. Develop green production and process. Be a responsible player in the industry.

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• Explore opportunities in businesses which requires
• Explore opportunities with multi-national companies
• Cooperate or consolidate with local companies in
• Develop green products and their applications,
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Aiming Towards the Future

• Explore opportunities in businesses which requires GMP, such as APIs and personal care industry.

• Explore opportunities with multi-national companies

• Cooperate or consolidate with local companies in the same or downstream market.

• Develop green products and their applications, particularly in the rubber and plastic industries.

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Thank You!

Q & A

Our Website：www.sunko.com.tw