SUNON — Interim / Quarterly Report 2020

Aug 19, 2020

SUNONwealth Electric Machine Industry Co., Ltd. 2020 Q2 Operating Results 2421.TW / 2421 TT

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

Page 1

Safe Harbor Notice

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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
Chip TIM Copper Fan 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)

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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)

40 YEARS

Innovative Energy-Saving Motor Design & Technology

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E s t a b l i s h e d E m p l o y e e s F a c t o r i e s T u r n o v e r (Taiwan) (China) (Taiwan) (China) USD$ 1980 530 7500 1 3 387[M] (Year 2019)

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Motor 0.1W 1500 Watts Fan 8mm 80mm 120mm 250 mm 3000mm 7300mm

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

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Growth
Pattern
Server, Data center
(NTD)
12,000,000
U.S.-China
10,000,000 trade war
SUNON enters LED
PM2.5 Air Purifier and
lighting industry
Received orders from Automotive electronics
8,000,000 Became the only
STB and automotive
supplier for Philips
manufactures
6,000,000
SUNON enters Cloud Data Center
4,000,000 Financial
Received orders from Facebook , Google
Received order from Crisis
Cisco, ZTE, Huawei major telecom
major telecom and Cloud Data manufactures
manufacture
2,000,000
0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Page 8

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SUNON
Research
PANTENTS
3000 [2802]
[2671]
2454 [2568]
2500 2298
2006 2157
2000 [1825]
1586 [1695]
1451
1500
1000
500
0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT) Page 9
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)
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Global Support 15 115 1000+ Subsidiary & Office Distributor & Agent Sales & Service sites

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

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World Leading Motor Technology

Sound MagLev Shockproof Ultra Energy Quality System System Thin Efficient Analysis

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3mm Thickness

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92%
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
ANALYSIS
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STRUCTURAL SIMULATION HIGH VOLTAGE DIRECT
ANALYSIS CURRENT(DC)
ELECTRICITY
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Fan and Motor

Air Flow Management SUNON concentrated on its core motor technology and accumulated various inventions and innovations in this field. We now provide various sizes of motor and fan which featuring higher flexibility, energy-efficiency, lower noise, and longer service life.

Total Air Fresh Solution

It implies a demand for craftsmanship and minimalist beauty in German design and creates an all-new experience in clean air quality for the new generation of healthy homes.

Air Exchanger

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SUNON Product

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Cooling Module

Total Thermal Solution As a world-renowned cooling leader, we can provide customized and integrated service to our clients easily base on sophisticated experience and innovative technology.

Optimal air Circulation

It features an ultra slim motor and a stylish shape. The patented silent winglet design, energy efficient and high airflow fan creates thermal comfort and healthy environment.

HVLS Fan

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

Total Thermal Solution

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Fan & Motor

Cooling Module

HIGH COMPACT EFFICIENCY SIZE ENERGY SUPER SAVING SILENCE

CUSTOMIZED ECONOMIC DESIGN DESIGN SOLUTION VENT FLEXIBLE DESIGN OPTIMIZATION FEAIBILITY

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Fan Tray Water proof Fan DC Blower DC motor EC Axial Fan

EC Centrifugal Fan

Active Cooling Module Passive Cooling Module

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Liquid cooling

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Temperature Application System Flow Velocity

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

Professional Ventilation

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HVLS FAN

Air Exchanger

ENERGY HIGH DIRECT DRIVE FRESH SUPER ENERGY SAVING VOLUME MOTOR AIR SILENCE SAVING IRIS UFO Ventilation Fan Flow2 One

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

Products Application & YOY Growth

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50% 2017
2018
40% 36.9%
2019
29.4%
30%
2020H1
20%
13.3% 36.1%35.5%36.7%
25.7%
10% 7.4% 6.8% 20.4%22.8%
5.0% 16.0%15.9%
13.5%
1.9% 1.8% 1.4%1.1% 4.2% 4.3% 6.4% 10.7% 9.8% 7.9% 10.7%10.0% 8.4%
0%
LED Lighting Automobile Distribution Home Industrial Telecom & IT & OE
Appliances Medical E. Server
-3.4%
10.9%
-12.2% -12.9%
18.7%
-20.9%
34.4%
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Page 16

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

Revenue Performance

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UNIT: NTD (K)

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12,000,000 11,965,298 11,659,915 20%
10,109,156 [10,690,822 10,946,728 ]
10,000,000 9,533,345 13.8% 15%
15.5%
8,256,495
9.3%
8,000,000 10%
7.1%
6.0% 5.8%
5,850,341
6,000,000 5%
2.4%
4,000,000 0%
-2.6%
2,000,000 -5%
0 -10%
Y2013 Y2014 Y2015 Y2016 Y2017 Y2018 Y2019 Y2020H1
Revenue Growth rate
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Profit Margin

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Gross Margin
30%
25.7%
21.4%
20% 20.4%21.6% 21.6%23.3% 23.4% 22.1%
22.0% 19.4% 23.0% 23.3% 21.4% 19.6% 22.4% 20.1%
18.3%
22.9% 23.5% 22.6% 22.4%
10% 20.5%
0%
Q1 Q2 Q3 Q4 Y
Y2016 Y2017 Y2018 Y2019 Y2020Q1
Operating Margin
12%
11.9%
9%
7.9% 7.8% 7.6% 8.9% 8.2% 8.5%
6% 6.0% 3.8% 6.4% 8.2% 6.5% 6.9% 6.8%
4.9% 5.8% 5.4% 5.0%
3% 4.4%
2.7% 2.6% 2.7%
0%
Q1 Q2 Q3 Q4 Y
Net Margin
12%
10.3%
9%
6% 5.1% 4.3% 5.7% 7.4% 6.1% 5.9% 6.3% 6.5% 7.9% 6.7% 6.7% 5.5% 6.0% 5.1% 5.8%
3% 3.9% 6.4% 5.1% 4.6%
2.3% 2.6%
0%
Q1 Q2 Q3 Q4 Y
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Earning & Cash Dividend

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UNIT: NTD

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3.0 2.71
2.62
2.5 2.28 2.41 2.3
2.0 2.0 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 Y2018 Y2019
Payout R. 120.48% 81.97% 79.47% 84.75% 87.72% 87.79% 82.99% 73.80%
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

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Medium Term Drivers

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Energy Storage Industry 4.0 5G
Electric car
System Inverter / Drive Application
IoT ,AI Industrial
Gaming Air Purifier
& Cloud Computing Ventilation
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SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)

Appendix I

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		CONSOLIDATED BALANCE	CONSOLIDATED BALANCE	CONSOLIDATED BALANCE	CONSOLIDATED BALANCE	SHEETS
NT$ M	2016	2017	2018	2019	2019 Q2	2020 Q2	2017	2018 Growth	2019 YOY(%)	2020Q2
TOTAL ASSETS	8,391	8,813	8,972	9,439	8,610	9,500	5.03%	1.80%	5.21%	10.34%
Cash	1,338	1,387	1,145	1,271	1,331	1,575	3.66%	-17.45%	11.00%	18.33%
A/R, N/R	2,871	2,724	3,091	3,323	2,610	3,369	-5.12%	13.47%	7.51%	29.08%
Inventories	1,377	1,744	1,794	1,519	1,518	1,608	26.65%	2.87%	-15.33%	5.93%
PP&E	2,182	2,294	2,378	2,277	2,373	2,148	5.13%	3.66%	-4.25%	-9.48%
TOTAL LIABILITIES	4,324	4,639	4,832	5,211	4,745	5,370	7.28%	4.16%	7.84%	13.17%
Short-term loans	454	636	843	927	506	648	40.09%	32.55%	9.96%	28.06%
A/P	2,469	2,550	2,671	2,705	2,228	2,555	3.28%	4.75%	1.27%	14.68%
Long-term loans	320	320	220	220	220	220			0.00%	0.00%
TOTAL EQUITY	4,067	4,174	4,139	4,229	3,864	4,130	2.63%	-0.84%	2.17%	6.88%
Days sales outstanding	91	93	89	100	101	104
Days sales of inventory	63	67	68	67	74	64
Current Ratio	1.5336	1.4898	1.4247	1.4272	1.2268	1.4311

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

Appendix II

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CONSOLIDATED STATEMENT OF	CONSOLIDATED STATEMENT OF	CONSOLIDATED STATEMENT OF	CONSOLIDATED STATEMENT OF	CONSOLIDATED STATEMENT OF	COMPREHENSIVE INCOME	COMPREHENSIVE INCOME	COMPREHENSIVE INCOME	COMPREHENSIVE INCOME
NT$ M	2016	2017	2018	2019	2019 H1	2020 H1	2017	2018 Growth	2019 YOY(%)	2020H1
OPERATING REVENUES	10,691	10,947	11,965	11,660	5,141	5,850	2.39%	9.30%	-2.55%	13.79%
GROSS PROFIT	2,398	2,454	2,402	2,579	1,056	1,406	2.34%	-2.12%	7.37%	33.14%
INCOME FROM OPERATIONS	695	756	602	787	222	515	8.78%	-20.37%	30.73%	131.98%
INCOME BEFORE INCOME TAX	833	842	784	910	257	557	1.08%	-6.89%	16.07%	116.73%
NET INCOME attribute to owners	572	657	605	681	206	467	14.86%	-7.91%	12.56%	126.70%
EPS (NT$)	2.28	2.62	2.41	2.71	0.82	1.86
Gross Margin	22.43%	22.42%	20.08%	22.12%	20.54%	24.03%
Operating Margin	6.50%	6.91%	5.03%	6.75%	4.32%	8.80%
Net Margin(*)	5.35%	6.00%	5.06%	5.84%	4.01%	7.98%

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

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

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