SUNON — Interim / Quarterly Report 2021

Dec 16, 2021

==> picture [721 x 136] intentionally omitted <==

SUNONwealth Electric Machine Industry Co., Ltd.

2021 Q3 Operating Results 2421.TW / 2421 TT

==> picture [721 x 136] intentionally omitted <==

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)

==> picture [85 x 17] intentionally omitted <==

Page 2

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.

Passive Cooling Active Cooling

==> picture [601 x 223] intentionally omitted <==

----- Start of picture text -----

Heat sinks Heat pipes Liquid cooling Cooling Fan
Vapor chamber
----- End of picture text -----

From Wikipedia, the free encyclopedia

==> picture [85 x 17] intentionally omitted <==

Page 3

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

==> picture [663 x 494] intentionally omitted <==

----- Start of picture text -----

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
----- End of picture text -----

==> picture [85 x 17] intentionally omitted <==

Page 4

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

Cooling Fan (Server)

==> picture [212 x 171] intentionally omitted <==

==> picture [451 x 301] intentionally omitted <==

Photo Source :Internet

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

==> picture [33 x 11] intentionally omitted <==

----- Start of picture text -----

Page 5
----- End of picture text -----

==> picture [318 x 173] intentionally omitted <==

Cooling Fan Thermal Module (Telecom)

==> picture [721 x 178] intentionally omitted <==

==> picture [721 x 179] intentionally omitted <==

==> picture [85 x 17] intentionally omitted <==

Page 6

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

Cooling Fan Thermal Module (Auto)

==> picture [721 x 355] intentionally omitted <==

==> picture [85 x 17] intentionally omitted <==

Page 7

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

40 YEARS

Innovative Energy-Saving Motor Design & Technology

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 600 8300 1 3 387[M] (Year 2020)

==> picture [149 x 88] intentionally omitted <==

==> picture [122 x 48] intentionally omitted <==

==> picture [47 x 47] intentionally omitted <==

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

==> picture [85 x 17] intentionally omitted <==

Page 8

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

==> picture [719 x 520] intentionally omitted <==

----- Start of picture text -----

Growth
Pattern
COVID 19
(NTD)
Work From Home
14,000,000
Server, Data center
12,000,000
U.S.-China
10,000,000 SUNON enters LED trade war
Received orders from lighting industry
STB and automotive Became the only
PM2.5 Air Purifier and
8,000,000 manufactures supplier for Philips
Automotive electronics
6,000,000
4,000,000 SUNON enters Cloud Data Center
Financial
Received orders from Facebook , Google
Received order from Crisis
Cisco, ZTE, Huawei major telecom
major telecom and Cloud Data manufactures
2,000,000 manufacture
0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
----- End of picture text -----

Page 9

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

==> picture [720 x 518] intentionally omitted <==

----- Start of picture text -----

SUNON
Research
PANTENTS
3500
3,128
3000
2454 [2568 2671 ][2802]
2500
2006 2157 [2298]
2000
1451 [1586 1695][ 1825]
1500
1000
500
0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT) Page 10
----- End of picture text -----

==> picture [261 x 10] intentionally omitted <==

----- Start of picture text -----

SUNONwealth Electric Machine Industry Co., Ltd. (2421.TW / 2421 TT)
----- End of picture text -----

Global Support 14 114 1000+ Subsidiary & Office Distributor & Agent Sales & Service sites

==> picture [641 x 194] intentionally omitted <==

==> picture [85 x 17] intentionally omitted <==

Page 11

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

World Leading Motor Technology

Sound MagLev Shockproof Ultra Energy Quality System System Thin Efficient Analysis

==> picture [138 x 101] intentionally omitted <==

==> picture [139 x 104] intentionally omitted <==

3mm Thickness

==> picture [138 x 101] intentionally omitted <==

----- Start of picture text -----

92%
efficiency
----- End of picture text -----

==> picture [139 x 102] intentionally omitted <==

==> picture [85 x 17] intentionally omitted <==

Page 12

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

Outstanding Technology Total Thermal solution

==> picture [721 x 284] intentionally omitted <==

----- Start of picture text -----

STRUCTURAL SIMULATION ALTIUM DESIGNER MAGNETIZATION TEMPERATURE SIMULATION MOLD SYSTEM TEMPERATURE
ANALYSIS SIMULATION ANALYSIS ANALYSIS ANALYSIS
AC IN
DC
OUT
MOTOR EFFICIENCY MATERIAL ANALYSIS AND HIGH VOLTAGE DIRECT VIBRATION FREQUENCY SOUND QUALITY ANALYSIS
ANALYSIS RESEARCH CURRENT(DC) ELECTRICITY SPECTRUM ANALYSIS
----- End of picture text -----

==> picture [85 x 17] intentionally omitted <==

Page 13

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

==> picture [59 x 58] intentionally omitted <==

==> picture [116 x 128] intentionally omitted <==

SUNON Product

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

==> picture [85 x 17] intentionally omitted <==

==> picture [38 x 12] intentionally omitted <==

----- Start of picture text -----

Page 14
----- End of picture text -----

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

Total Thermal Solution

Fan & Motor

Cooling Module

HIGH COMPACT EFFICIENCY SIZE ENERGY SUPER SAVING SILENCE

CUSTOMIZED ECONOMIC DESIGN DESIGN SOLUTION VENT FLEXIBLE DESIGN OPTIMIZATION FEAIBILITY

Waterproof Fan Fan Tray EC Axial Fan DC/AC Axial Fan DC Blower Mighty Mini Fan DC motor EC Centrifugal Fan

==> picture [79 x 73] intentionally omitted <==

Active Cooling Module

==> picture [235 x 160] intentionally omitted <==

Passive Cooling Module

Liquid Cooling Module

Page 15

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

Professional Ventilation

HVLS FAN

Air Exchanger

ENERGY HIGH DIRECT DRIVE SAVING VOLUME MOTOR

FRESH SUPER ENERGY AIR SILENCE SAVING

==> picture [172 x 170] intentionally omitted <==

Modern HVLS FAN

==> picture [174 x 171] intentionally omitted <==

Powerful HVLS FAN

Ventilation Fan Flow2 One

==> picture [85 x 17] intentionally omitted <==

Page 16

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

Sufficient Capability

production bases in 2022

Fans 25 M/month Cooling modules 2.5M/month

==> picture [721 x 98] intentionally omitted <==

==> picture [631 x 35] intentionally omitted <==

----- Start of picture text -----

Kaohsiung, Taiwan Kunshan, Jiangsu Beihai, Guangxi Bataan, Philippines
1M/month 9 M/month(FAN) 8.5 M/month 6.5 M/month
2.5 M/month(CM) 2022
----- End of picture text -----

==> picture [117 x 81] intentionally omitted <==

==> picture [115 x 81] intentionally omitted <==

==> picture [116 x 81] intentionally omitted <==

==> picture [121 x 81] intentionally omitted <==

==> picture [117 x 81] intentionally omitted <==

==> picture [122 x 81] intentionally omitted <==

==> picture [85 x 17] intentionally omitted <==

Page 17

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

Products Application & YOY Growth

==> picture [690 x 343] intentionally omitted <==

----- Start of picture text -----

50% 2018
2019
40%
34.4%
2020
28.7%
30%
2021YTD
20%
14.7% 35.5%36.7%36.0%
28.2%
10% 8.5% 7.4% 22.8%25.7%
5.3% 15.9%13.5%14.6%
1.8% 1.4% 1.1%1.0% 4.3% 6.4% 5.2% 9.8% 7.9% 7.7% 10.0% 8.4% 7.2%
0%
LED Lighting Automobile Distribution Home Industrial Telecom & IT & OE
Appliances Medical E. Server
-3.9% 2.3% 2.2%
7.8%
12.2% 11.8%
19.2%
----- End of picture text -----

==> picture [85 x 17] intentionally omitted <==

Page 18

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

Revenue Performance

UNIT: NTD (K)

==> picture [583 x 340] intentionally omitted <==

----- Start of picture text -----

14,000,000 20%
12,781,281
12,000,000 11,965,298 11,659,915 15%
15.5% 10,690,822 10,946,728
10,109,156
9,837,980
10,000,000 9,533,345 10%
9.3% 9.6%
8,000,000 5%
6.0% 5.8%
4.82%
6,000,000 2.4% 0%
4,000,000 -2.6% -5%
2,000,000 -10%
Y2014 Y2015 Y2016 Y2017 Y2018 Y2019 Y2020 Y2021
Revenue Growth rate
----- End of picture text -----

==> picture [85 x 17] intentionally omitted <==

Page 19

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

Profit Margin

==> picture [576 x 442] intentionally omitted <==

----- Start of picture text -----

Gross Margin
30%
20% 17.5% 21.6%25.7%18.9% 23.3%25.0%18.7% 23.4% 23.5%18.4%
21.4% 21.0% 22.1%
19.4% 20.4% 21.6% 19.6% 20.1%
18.3%
10% 22.0% 23.0% 23.3% 21.4% 22.4%
0%
Q1 Q2 Q3 Q4 Y
Y2017 Y2018 Y2019 Y2020 Y2021
Operating Margin
12%
11.9%
9% 10.6%
8.9% 8.7%
6% 6.0% 7.9% 5.8% 8.2% 7.6% 3.4% 8.5% 6.0% 6.9% 6.8%
3% 3.8%2.0% 4.9% 1.9% 5.4% 4.4% 5.0% 2.5%
2.6% 2.7%
0%
Q1 Q2 Q3 Q4 Y
Net Margin
12%
9% 10.3%
6% 3.1% 7.4% 6.1% 6.4% 7.9% 6.6% 6.7% 6.0% 5.8% 6.7%
5.1% 5.9% 2.2% 6.5% 2.5% 5.1% 2.6%
3% 3.9% 4.3% 5.1% 4.6% 4.5%
2.6%
0%
Q1 Q2 Q3 Q4 Y
----- End of picture text -----

==> picture [85 x 17] intentionally omitted <==

==> picture [38 x 11] intentionally omitted <==

----- Start of picture text -----

Page 20
----- End of picture text -----

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

Earning & Cash Dividend

UNIT: NTD

==> picture [631 x 350] intentionally omitted <==

----- Start of picture text -----

4.0
3.39
3.5
2.71
3.0 2.62
2.4
2.5 2.28 2.41 2.0 2.3 2.0 2.0
1.77
2.0
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 y2020
2012 2013 2014 2015 2016 2017 2018 2019 2020
Payout
120.48% 81.97% 79.47% 84.75% 87.72% 87.79% 82.99% 73.80% 70.80%
R.
----- End of picture text -----

==> picture [85 x 17] intentionally omitted <==

Page 21

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

Medium Term Drivers

==> picture [722 x 267] intentionally omitted <==

----- Start of picture text -----

Energy Storage Industry 4.0 5G
Electric car
System Inverter / Drive Application
IoT ,AI Industrial
Metaverse Gaming Air Purifier
& Cloud Computing Ventilation
----- End of picture text -----

==> picture [182 x 159] intentionally omitted <==

==> picture [183 x 157] intentionally omitted <==

==> picture [180 x 158] intentionally omitted <==

==> picture [199 x 155] intentionally omitted <==

==> picture [85 x 17] intentionally omitted <==

Page 22

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

Appendix I

		CONSOLIDATED BALANCE	CONSOLIDATED BALANCE	CONSOLIDATED BALANCE	CONSOLIDATED BALANCE	SHEETS
NT$ M	2017	2018	2019	2020	2020 Q3	2021 Q3	2018	2019 Growth	2020 YOY(%)	2021Q3
TOTAL ASSETS	8,813	8,972	9,439	10,419	10,104	11,241	1.80%	5.21%	10.38%	11.25%
Cash	1,387	1,145	1,271	1,575	1,515	1,831	-17.45%	11.00%	23.92%	20.86%
A/R, N/R	2,724	3,091	3,323	3,226	3,416	3,286	13.47%	7.51%	-2.92%	-3.81%
Inventories	1,744	1,794	1,519	1,752	1,603	2,616	2.87%	-15.33%	15.34%	63.19%
PP&E	2,294	2,378	2,277	2,106	2,157	2,131	3.66%	-4.25%	-7.51%	-1.21%
TOTAL LIABILITIES	4,639	4,832	5,211	5,825	5,702	7,061	4.16%	7.84%	11.78%	23.83%
Short-term loans	636	843	927	671	784	1,894	32.55%	9.96%	-27.62%	141.58%
A/P	2,550	2,671	2,705	2,823	2,759	3,033	4.75%	1.27%	4.36%	9.93%
Long-term loans	320	220	220	520	520	487			136.36%	-6.35%
TOTAL EQUITY	4,174	4,139	4,229	4,594	4,402	4,180	-0.84%	2.17%	8.63%	-5.04%
Days sales outstanding	93	89	100	94	98	91
Days sales of inventory	67	68	67	61	60	74
Current Ratio	1.4898	1.4247	1.4272	1.4984	1.4532	1.3049

==> picture [85 x 17] intentionally omitted <==

Page 23

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

Appendix II

CONSOLIDATED STATEMENT OF	CONSOLIDATED STATEMENT OF	CONSOLIDATED STATEMENT OF	CONSOLIDATED STATEMENT OF	CONSOLIDATED STATEMENT OF	COMPREHENSIVE INCOME	COMPREHENSIVE INCOME	COMPREHENSIVE INCOME	COMPREHENSIVE INCOME
					2020	2021		Growth	YOY(%)
NT$ M	2017	2018	2019	2020	YTD	YTD	2018	2019	2020	2021 YTD
OPERATING REVENUES	10,947	11,965	11,660	12,781	9,386	9,838	9.30%	-2.55%	9.61%	4.82%
GROSS PROFIT	2,454	2,402	2,579	2,998	2,289	1,810	-2.12%	7.37%	16.25%	-20.93%
INCOME FROM OPERATIONS	756	602	787	1,114	890	244	-20.37%	30.73%	41.55%	-72.58%
INCOME BEFORE INCOME TAX	842	784	910	1,088	891	340	-6.89%	16.07%	19.56%	-61.84%
NET INCOME attribute to owners	657	605	681	852	700	256	-7.91%	12.56%	25.11%	-63.43%
EPS (NT$)	2.62	2.41	2.71	3.39	2.79	1.02
Gross Margin	22.42%	20.08%	22.12%	23.46%	24.39%	18.40%
Operating Margin	6.91%	5.03%	6.75%	8.72%	9.48%	2.48%
Net Margin(*)	6.00%	5.06%	5.84%	6.67%	7.46%	2.60%

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

==> picture [85 x 17] intentionally omitted <==

Page 24

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

==> picture [721 x 136] intentionally omitted <==

Thanks for Your Attention !

WWW.SUNON.COM