SUNON — Interim / Quarterly Report 2018

Jun 7, 2018

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建準2421
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SUNONwealth Electric Machine Industry Co., Ltd

2018 Q1 Operation results 2421.TW / 2421 TT

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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Safe Harbor Notice

This presentation is based on the information obtained from various sources which the Company believes to be reliable. But at some point in the future, there are a variety of factors which could cause actual results to differ materially from those statements. Therefore, please refer to the information on MOPS website as the main basis if any adjustment has been made.

(http://mops.twse.com.tw/mops/web/index)

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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Thermal & Thermal Management

All electronic devices and circuitry generate excess heat and thus require thermal management to improve reliability and prevent premature failure. The amount of heat output is equal to the power input, if there are no other energy interactions.There are several techniques for cooling including various styles of heat sinks, thermoelectric coolers, forced air systems and fans, heat pipes, and others.

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Passive Cooling
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Active Cooling

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Heat sinks Heat pipes Liquid cooling Cooling Fan
Vapor chamber
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From Wikipedia, the free encyclopedia

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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

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Thermal
Module
Thermal Module
Heat Heat Ambient
TIM Fan
Chip Copper temperature
pipes sinks
meet
Heat heat transfer heat dissipation system
Operating
temperature
Photo Source :Internet
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Cooling Fan (Server)

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Photo Source :Internet

SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

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Cooling
Fan
(Auto)
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

37 YEARS

Innovative Energy-Saving Motor Design & Technology

Company Overview

Established：1980 Employees ： 500 people (Taiwan) 7400 people (China) Turnover ：NTD$ 10.95 Bn (Y2017) Factories ： Kaohsiung Plant (Taiwan) Kun Shan Plant (China) Foshan Plant (China) Beihai Plant (China) Hefei Plant (China)

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Motor 0.1W 1500 Watts Fan 3mm 80mm 200mm 630 mm 3000mm 7000mm

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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

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Growth
Pattern
Million (NTD) PM2.5 Air Purifier and
Automotive electronics
SUNON enters LED lighting industry
Received orders from STB Became the only supplier for Philips
and automotive manufactures
Received orders from
Financial Cisco, ZTE, Huawei major telecom
Crisis and Cloud Data manufactures
Received order from major
telecom manufacture
SUNON enters Cloud Data Center
Received orders from Facebook and Google
Focus on Micro Cooling Device
The only supplier for NB OEM
SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT) Page 8
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

SUNON Research

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PANTENTS

SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

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• Global Over 1,000 sales representatives, 12 subsidiaries and offices, and over 130 distributors around the world.

• Support

• 7 research centers which provide a worldwide technological service network for quick and efficient services.

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Europe China / Foshan China / Kunshan Taiwan Taiwan Taipei Japan/ Yokohama U.S.A.
Research Center Research Center Research Center Research Center Research Center Research Center Research Center
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

World Leading Motor Technology

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Sound
MagLev Shockproof Ultra Energy
Quality
System System Thin Efficient
Analysis
92%
3mm
Thickness efficiency
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Outstanding Technology

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MAGNETIZATION MOTOR EFFICIENCY VIBRATION FREQUENCY MATERIAL ANALYSIS
SIMULATION ANALYSIS ANALYSIS SPECTRUM ANALYSIS AND RESEARCH
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SOUND QUALITY THERMAL ANALYSIS STRUCTURAL SIMULATION HIGH VOLTAGE DIRECT
ANALYSIS ANALYSIS CURRENT(DC)
ELECTRICITY
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

SUNON Product Line

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Cooling
Module
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Fan & Blower

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Fan Size
8mm- 630mm
DC Axial Fan DC Blower AC Axial Fan
Mighty Mini Fan Water proof Fan Explosion-proof Fan
Fan Tray
Dual Blower EC Axial Fan EC Blower EC Centrifugal Fan
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Cooling Module

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Active Passive
Cooling Cooling
Module Module
Liquid
cooling
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Motor

Highly Energy efficient motor 0.1W ~ 1500W

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DC motor
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Commercial
HVACR
Refrigerator / Freezer
EC horsepower motor
EC motor
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Ventilation Eco ventilation solution

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Ventilation Fan Flow2 One HVLS Fan

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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Products Application

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50% 2016 2017 2018YTD
41.4%
40% 36.5%
36.1%
30%
20.5%
20.4%
20% 17.6%
15.6% 16.0%15.4%
10.7% 10.5% 10.7%10.9%
10.7%
10% 9.0%
4.2% 4.0%
2.0% 1.9% 2.0% 3.9%
0%
LED Lighting Automobile Distribution Home Industrial Telecom & IT & OE
Appliances Medical E. Server
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

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Revenue Performance

UNIT: NTD (K)

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12,000,000 Revenue Growth rate 18%
10,690,822 [10,946,728 ]
10,109,156 16%
10,000,000 9,533,345
15.5% 14%
8,256,495
7,708,731
8,000,000 12%
10%
6,000,000
8%
4,000,000 7.1% 6%
6.0% 2,608,766
5.8% 4%
2,000,000
3.7% 2%
2.4%
0 0%
Y2012 Y2013 Y2014 Y2015 Y2016 Y2017 Y2018Q1
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Profit Margin

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Gross Margin
30%
22.95% 23.33% 21.35% 22.42%
21.98%
18.30% 22.86% 23.47% 22.59% 22.43%
20.47%
10% 17.53% 19.69% 21.14% 22.44% 20.32%
-10% Q1 Q2 Q3 Q4 Y
Y2015 Y2016 Y2017 Y2018YTD
Operating Margin
10%
7.92% 8.15%
8% 6.91%
6.01% 7.81% 8.24%
6% 5.39%
6.39% 6.51% 6.50%
5.92%
4%
2.60% 4.34%
3.46%
2% 2.67%
0.83%
0%
Q1 Q2 Q3 Q4 Y
Net Margin
10%
8% 7.36% 6.44% 6.29% 6.42% 6.32% 6.74% 6.01%
5.66% 5.51%
6% 5.12% 5.05%
4.44%
4% 3.07%
2.26% 2.60%
2% 1.30%
0%
Q1 Q2 Q3 Q4 Y
SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT) Page 20
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Earning & Cash Dividend

UNIT: NTD

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3.0 2.62
2.5 2.28 2.3
2.0
2.0 1.77
1.51 1.5
1.5 1.22 1.2
1.0 1.0
0.83
1.0
0.5
0.0
EPS Cash Dividend
Y2012 Y2013 Y2014 Y2015 Y2016 Y2017
Payout R. 120.48% 81.97% 79.47% 84.75% 87.72% 87.79%
SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT) Page 21
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Medium Term Drivers

EC motor IoT & 5G Automobile for HVACR Industry 4.0 Application AI HPC & Cloud Home Application Gaming Concept Air Purifier Computing VR MR AR Photo Source :Internet

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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Appendix I

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

NT$ M	2014	2015	2016	2017	2018Q1		2015	2016 Growth	2017 YOY(%)	2018Q1
OPERATING REVENUES	9,533	10,109	10,691	10,947	2,609		6.04%	5.76%	2.39%	3.74%
GROSS PROFIT	1,953	2,054	2,398	2,454	477		5.17%	16.75%	2.34%	-13.74%
INCOME FROM OPERATIONS	418	439	695	756	70		5.02%	58.31%	8.78%	-53.64%
INCOME BEFORE INCOME TAX	525	584	833	842	84		11.24%	42.64%	1.08%	-42.86%
NET INCOME attribute to owners	379	442	572	657	67		16.62%	29.41%	14.86%	-47.24%
EPS (NT$)	1.51	1.77	2.28	2.62	0.27
Gross Margin	20.49%	20.32%	22.43%	22.42%	18.28%
Operating Margin	4.38%	4.34%	6.50%	6.91%	2.68%
Net Margin(*)	3.98%	4.37%	5.35%	6.00%	2.57%

(*)Net Margin=Net Income attribute to owners / Revenue

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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Appendix II

	CONSOLIDATED BALANCE SHEETS	CONSOLIDATED BALANCE SHEETS
		2015 2016 2017 2018Q1 2.72% 11.54% 5.03% 6.83% 32.05% 5.44% 3.66% 12.39% -0.04% 17.71% -5.12% -4.31% 10.61% -6.96% 26.65% 21.95% -1.93% 22.93% 5.13% 8.68% 4.52% 22.98% 7.28% 8.68% Growth YOY(%)
	NT$ M 2014 2015 2016 2017 2018Q1
	TOTAL ASSETS 7,324 7,523 8,391 8,813 8,419
	Cash 961 1,269 1,338 1,387 1,188
	A/R, N/R 2,440 2,439 2,871 2,724 2,507
	Inventories 1,338 1,480 1,377 1,744 1,767
	PP&E 1,810 1,775 2,182 2,294 2,317
	TOTAL LIABILITIES 3,364 3,516 4,324 4,639 4,143
	Short-term loans 497 464 454 636 536	-6.64% -2.16% 40.09% 8.94% 7.76% 18.47% 3.28% 8.48% 1.19% 1.50% 2.63% 5.09%
	A/P 1,934 2,084 2,469 2,550 2,290
	Long-term loans 0 0 320 320 320
	TOTAL EQUITY 3,960 4,007 4,067 4,174 4,276
	Days sales outstanding 85 88 91 93 91
	Days sales of inventory 60 64 63 67 75
	Current Ratio 1.635 1.6317 1.5336 1.4898 1.5802

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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

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www.sunon.com

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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)