2017/5/18

Disclaimer

This presentation is prepared according to information available at the time the presentation was made. Financial or other related information may contain forward-looking statements about the company and its subsidiaries. The information is subject to significant risks and uncertainties, and actual results may differ materially from those contained in any forward-looking statements.

The presentation is exclusively for the purpose of providing information, and not for the purpose of investment advice. The company does not undertake obligations of accuracy and completeness of the information and any losses caused by using the information of the presentation.

Agenda

THINKING Introduction
THINKING Product:
-Product introduction
-Product applications and THINKING customers
Industry Advantages
Operation Overview
Business Philosophy
Future Outlook

1. THINKING Introduction

Date of Establishment: 1979/7/16
Chairman of The Board : S.A. Chen
Paid-in Capital: Around NTD 1.28 billion
Headquarter: Kaohsiung, Taiwan
THINKING Factory Scale:
| | Employee Size | Factory Area (square meter) |
| --- | --- | --- |
| Taiwan | 300 | 11,400 |
| Changzhou, China | 1,500 | 92,600 |
| Dongguan, China | 1,400 | 14,000 |
| Yichang, China | 600 | 14,600 |
| Jingdezhen, China | 200 | 15,000 |
| | 4,000 | 147,600 |

1. THINKING Introduction: ?Corporate Milestone

Year	Event
1979	THINKING was founded with wire harness business
1989	Started NTC Thermistor business
1996	Changzhou & Dongguan Factories were established
1997	Started Varistor & PTC Thermistor business
2000	THINKING went public
2002	Started Polymer PTC Thermistor and Gas Discharge Tube business
2007	Yichang Factory was established
2008	Started ESD Protector business
2014	Jingdezhen Factory was established
2016	Kaohsiung 2nd Factory was established
2016	Started TVS Diode business

1. THINKING Introduction:? THINKING Group

THINKING Introduction: ?THINKING Factory

Yichang Factory

$C:\Users\Administrator\Desktop\777481433369416590.jpg$
Establishment Year:
2007

Changzhou Factory

4.北門+後製車間.jpg
Establishment Year:
1996

Jingdezhen Factory

Establishment Year:
2014

Dongguan Factory

Establishment Year:
1996

Kaohsiung 2nd Factory
Kaohsiung 1ST Factory

nz factoryfffff8

Establishment Year:
2016
Establishment Year:
1979

1. THINKING Introduction: ?Global Sales Network

Global sales network of THINKING offers customers
timely services.

地圖-2

Sales/Distributor

Factory/Warehouse

UK
Poland

Germany

France
Switzerland

Canada

Italy
USA

Korea
Japan
Israel

Yichang, China
Changzhou, China

Jingdezhen, China
India

Dongguan,
China

Taipei, Taiwan
Thailand

Kaohsiung, Taiwan

Brazil

      Malaysia

Singapore

Notes:

2006.01.31 變更factory的顏色,將地名改為中文
新增Israel (以色列) 、Italy(義大利) 、Switzerland

2. THINKING Product:?Product Introduction

THINKING is a broad-line circuit protection solution provider.

Over?Voltage
Protection

j0318131

Over?Current
Protection

Over?Temperature
Protection

2. THINKING Product:?Product Introduction

gdt

Gas Discharge Tube

TVS Diode

Metal Oxide Varistor

mov

$d:\Users\ASUS\Desktop\TVS for外銷\TVS產品全圖片.jpg$
Over-voltage
Protection

NTC Thermistor

未命名-4

PTC ALL
PTC Thermistor

$D:\Users\user\Desktop\2016年company profile\2016年公司簡介\產品介紹圖片\ocp-pptc.jpg$
Polymer PTC
Thermistor
Over-current
Protection

NTC Thermistor

NTC all

smd ptc
PTC Thermistor

sensor all
Temperature Sensor
Over-temperature
Protection

2. THINKING Product:?Product Applications

PC Industry

Computer
Power Supply

Desktop
Computer

Notebook
Computer

Home Appliance

Air Conditioner

Washing
Machine

Coffee
Machine

$D:\行銷工具\產品圖片\產品應用圖\消費型電子或家電-02.jpg$
Refrigerator

Television

Lighting

LED Bulb

LED
Street Light

$D:\行銷工具\產品圖片\產品應用圖\LED Street Lighting 3.jpg$
LED Tube

pic_t_bar

Surge Protection Device

Automobile

LED
Headlamp

Charging
Station

$d:\Users\ASUS\Desktop\玉芳公關版公司簡介\未命名-1-01.jpg$
Sunroof

Wing Mirror

$d:\Users\ASUS\Desktop\玉芳公關版公司簡介\未命名-1-02.jpg$
Others

Modem

$D:\行銷工具\產品圖片\產品應用圖\消費型電子或家電-07.jpg$
Card Reader

$d:\Users\ASUS\Desktop\玉芳公關版公司簡介\刷卡機-01.jpg$
Smartphone

$D:\行銷工具\產品圖片\產品應用圖\消費型電子或家電-08.jpg$
Electricity
Meter

$d:\Users\ASUS\Desktop\玉芳公關版公司簡介\電表-01.jpg$

$d:\Users\ASUS\Desktop\2017年公司宣傳資料\公關版公司簡介\SPD Module2.jpg$

2. THINKING Product:?THINKING Customers

Home
Appliances

PANSONIC - Servo Motor, Servo Drive, Minas

bosch-logo1-300x86

伊萊克斯 - 體貼您！

海尔集团,海尔公司,Haier,Haier Group

美的集团-原来生活可以更美的

samsung-logo

4-4Sony_Logo1-150x150

1428527_100504170248_Hisense_Logo
Lighting

osram_logo

$D:\Users\user\Desktop\公司簡介修改\philips.png$

325944
PC
Industry

240x240x1311747294z

康舒科技 AcBel Polytech Inc. logo

logo_emerson

liteon_logo

image_quanta

Compal Electronic Logo.jpg

Foxconn logo.svg

company_01
Surge Protection
Device

Schneider Electric: the global specialist in energy management

ABB to invest USD 24m to set up new plant in India

150px-%E6%AD%A3%E6%B3%B0%E9%9B%86%E5%9B%A2

201448164027
Others

3. Industry Advantages: ?High Global Market Share

THINKING’s manufacturing capability reaches economies of scale and acquires high global market share.

Market Share of THINKING NTC and ICL in 2016*	Market Share of THINKING Varistor in 2016*
(Fiscal year 2016, ending Dec. 31)	(Fiscal year 2016, ending Dec. 31)

$d:\Users\ASUS\Desktop\2017年公司宣傳資料\巿佔\產品巿佔\2017年\2017年NTC Market Share.jpg$

$d:\Users\ASUS\Desktop\2017年公司宣傳資料\巿佔\產品巿佔\2017年\2017年MOV Market Share.jpg$
*Data Source:? Circuit Protection Components: World Markets, Technologies & Opportunities: 2014-2019, Paumanok Publication

Industry Advantages:
Pre-sale Services
Technical Consultation

ANd9GcQ_UC9nXTraeymXr9_nAmXNx2QinhvYWlCrHHN7SY6DWewVHO0FPQ

Circuit Design Assistance

EMA212pr

Application Example

FAE Team Provides Professional Technical Services

Extensive Lab Service

未命名3

DSCN8827

Application Example

Product Selection Suggestion

Notes:

To assure our customers can find the better application performance, Thinking provides customers both field applications engineer service and technical supports. Our well-informed and knowledgeable field applications engineer team locates in Taiwan and China can provide various technical services to meet customers’ need. Start from the frontend design, our field applications engineer team can aid customers with product selection, technical consultation, and circuit design assistance or application example to shorten the amount of time customers spend on researching and development new products or technologies. FAE also assist customers in laboratory tests, analyzing test results, and proposing the solutions suited for the application. Thinking FAE team has served the leading global suppliers of different fields for many years, our professional and experienced technical skill always satisfy customer’s requirement and find the best solution for customers.

3. Industry Advantages:?Agency Approval of Product

logo_csaint_internal

NormLogo34

bm-tuv

top_title

UL logo1

NTC Thermistor

Varistor

Ceramic PTC Thermistor

Polymer PTC Thermistor

Gas Discharge Tube

NTC Sensor

UL logo1
Note: is for UL + cUL

Notes:

2006.12.14 新增NTC Sensor VDE 認證
新增CPTC VDE 認證
取消NTC Sensor認證 (目前尚未取得)

3. Industry Advantages:?UL Certified Laboratory

Reliability laboratory passed the CTDP (Client Test Data Program) qualification of UL.

DSCN8816

DSCN8817

未命名

DSCN8819

DSCN8827

3. Industry Advantages:?Certification of Management System

Quality Management System:
ISO 9001-2008, ISO/TS 16949-2009, QC 080000-2012

Health and Safety Management System:
OHSAS 18001-2007

Environmental Management System:
ISO 14001-2004
ISO 14064-1:2006 (Greenhouse Gas Verification Statement)
PAS 2050:2008 (Product Carbon Footprint Verification Statement /
Verified Product: TSM0402)

Notes:

OHSAS 18001-1999於2009/5更新為2007年版

3. Industry Advantages: ?Automated Production Lines

THINKING is equipped with highly automated production lines

$d:\Users\ASUS\Desktop\2017年公司宣傳資料\公關版公司簡介\自動化生產線照片\彎腳成型+焊錫02.jpg$

$d:\Users\ASUS\Desktop\2017年公司宣傳資料\公關版公司簡介\廠線照片\1490232573018.jpg$

3. Industry Advantages: ?Competitive Advantages

THINKING offers broad-line portfolio of circuit protection for one-stop shopping

Overall QC & international QA systems

Products and laboratories certified by reputed safety certification organizations

Excellent R&D force meets global industrial trend

Highly automated production

Good product quality is recognized by international manufacturers

Advantages of THINKING group are global sales network, complete customer services (including before, during, and after sales services), and 38 years of manufacturing experience

Notes:

OHSAS 18001-1999於2009/5更新為2007年版

4. Operation Overview: ?2016 Sales by Regions and Applications

Sales by Products

$d:\Users\ASUS\Desktop\2017年公司宣傳資料\公司簡介\銷售區別\英文版\2016 Sales by Products.jpg$
Sales by Applications

$d:\Users\ASUS\Desktop\company profile (Holly)\Sales by Applications.jpg$
Sales by Regions

$d:\Users\ASUS\Desktop\2017年公司宣傳資料\公司簡介\銷售區別\英文版\2016 Sales by Regions.jpg$
THINKING Revenue in 2016

4. Operation Overview: ?Consolidated Revenue of THINKING Group

Unit: Million NTD

4. Operation Overview: ?Yearly Consolidated Income Statement and ?Analysis of Operation Result

Unit: Thousand NTD
| Item | FY 2016 | FY 2015 | Change | Change Ratio (％) |
| --- | --- | --- | --- | --- |
| Net sales | 5,408,160 | 5,116,152 | 292,008 | 6% |
| Gross profit | 1,674,088 | 1,453,302 | 220,786 | 15% |
| Gross margin | 31% | 29% | | |
| Operating expenses | 681,912 | 597,762 | 84,150 | 14% |
| Operating net profit | 992,176 | 855,540 | 136,636 | 16% |
| Non-operating income and expenses | 225,993 | 125,319 | 100,674 | 80% |
| Income before income taxes | 1,218,169 | 980,859 | 237,310 | 24% |
| Income tax | 325,854 | 295,966 | 29,888 | 10% |
| Net profit for the year | 892,315 | 684,893 | 207,422 | 30% |
| Total comprehensive income for the year | 618,389 | 616,819 | 1,570 | 0.3% |
| EPS after tax | 7.03 | 5.40 | 1.63 | 30% |

4. Operation Overview: ?Non-operating Income and Expenses

Unit: Thousand NTD
| Item | FY 2016 | FY 2015 |
| --- | --- | --- |
| Foreign exchange gains and losses | 20,199 | 76,128 |
| Other income (Note) | 213,185 | 59,680 |
| Other gains and losses | (6,650) | (6,321) |
| Financial costs | (2,007) | (4,168) |
| Total non-operating income and expenses | 224,727 | 125,319 |
Note: Income from litigation is NTD 114,267 thousands, and income from relocation of Changzhou factory is NTD 29,385 thousands.

4. Operation Overview: ?Major Financial Indicator of Balance Sheet

Item	Dec. 31, 2016/ FY 2016	Dec. 31, 2015/ FY 2015
Debt Ratio(%)	31%	26%
Current Ratio(%)	309%	382%

4. Operation Overview: ?Cash Flow Statement for the Year

Unit: Thousand NTD

Item	FY 2016	FY 2015
Depreciation	167,372	157,149
(Increase) in inventory	(104,371)	(201,363)
Decreases (Increase) in accounts receivable	(89,618)	(78,148)
Increase (Decrease) in accounts payable	(12,203)	255,110
Cash provided by operating activities	984,952	1,060,072
Cash used in investing activities	(519,642)	(537,887)
Cash used in financial activities	(193,143)	(486,697)
Foreign exchange adjustments	(247,661)	(59,275)
Net increase in cash for the year	24,250	(23,787)

4. Operation Overview: ?Quarterly Consolidated Income Statement and Analysis of Operation Result

Unit: Million NTD
| Item | 2017Q1 | 2016Q4 | 2016Q3 | 2016Q2 | 2016Q1 | QoQ |
| --- | --- | --- | --- | --- | --- | --- |
| Net sales | 1,342 | 1,458 | 1,408 | 1,380 | 1,162 | 15% |
| Gross profit | 482 | 466 | 440 | 437 | 336 | 43% |
| Gross margin | 36% | 31% | 31% | 32% | 29% | |
| Operating expenses | 174 | 212 | 164 | 147 | 162 | 7% |
| Operating net profit | 308 | 254 | 276 | 290 | 174 | 77% |
| Non-operating income and expenses | (25) | 90 | 97 | 36 | 2 | 115% |
| Income before income taxes | 283 | 344 | 373 | 326 | 176 | 60% |
| Income tax | 80 | 106 | 61 | 108 | 53 | 50% |
| Net profit for the year | 203 | 238 | 312 | 218 | 123 | 81% |
| Total comprehensive income for the year | 27 | 195 | 203 | 127 | 93 | 70% |
| EPS after tax | 1.61 | 1.88 | 2.45 | 1.73 | 0.97 | 66% |

4. Operation Overview: ?Quarterly Non-operating Income and Expenses

Unit: Thousand NTD

Item	2017Q1	2016Q1	FY 2016
Foreign exchange gains and losses	(68,354)	(6,869)	20,199
Other income (Note)	47,468	10,094	213,185
Other gains and losses	(3,632)	(668)	(6,650)
Financial costs	(962)	(314)	(2,007)
Total non-operating income and expenses	(25,480)	2,243	224,727
Note:
FY 2016: Income from litigation is NTD 114,267 thousands, and income from relocation of Changzhou factory is NTD 29,385 thousands.
2017Q1: Income from relocation of Changzhou factory is NTD 28,030 thousands.

5. Future Outlook: ?Company Declaration

Declaration of Next 30 Years

New Concept → New Management
→ New Technology → New Market

6. Future Outlook: ?2017 Strategies and Goals

Introduction of high-end electronic ceramic technology

Introduction of base metal and in-house manufacturing of major raw material

Increase of automated production reduces costs

More focus on capturing market opportunities in automotive industry (Refer to next slide)

Expansion of production site of high margin products increases production capacity to capture market share

$d:\Users\ASUS\Desktop\玉芳公關版公司簡介\追加資料\EV Poster.jpg$

6. Future Outlook: ?Opportunities in Automotive Market

6. Future Outlook: ?Vision

Aggressively capturing market opportunities in electric vehicle increases THINKING’s market share in automotive industry

Expanding application markets of temperature sensors (For instance: Robot, IoT)

Production of high technical product is shifted back to Taiwan, and establishing factory in third place reduces costs and increases industry competitiveness

THANK YOU!

AI assistant

THINKING Investor Presentation 2017

2017/5/18

Disclaimer

Agenda

1. THINKING Introduction

1. THINKING Introduction: ?Corporate Milestone

1. THINKING Introduction:? THINKING Group

1. THINKING Introduction: ?Global Sales Network

Notes:

2. THINKING Product:?Product Introduction

2. THINKING Product:?Product Introduction

2. THINKING Product:?Product Applications

2. THINKING Product:?THINKING Customers

3. Industry Advantages: ?High Global Market Share

Notes:

3. Industry Advantages:?Agency Approval of Product

Notes:

3. Industry Advantages:?UL Certified Laboratory

3. Industry Advantages:?Certification of Management System

Notes:

3. Industry Advantages: ?Automated Production Lines

3. Industry Advantages: ?Competitive Advantages

Notes:

4. Operation Overview: ?2016 Sales by Regions and Applications

4. Operation Overview: ?Consolidated Revenue of THINKING Group

4. Operation Overview: ?Yearly Consolidated Income Statement and ?Analysis of Operation Result

4. Operation Overview: ?Non-operating Income and Expenses

4. Operation Overview: ?Major Financial Indicator of Balance Sheet

4. Operation Overview: ?Cash Flow Statement for the Year

4. Operation Overview: ?Quarterly Consolidated Income Statement and Analysis of Operation Result

4. Operation Overview: ?Quarterly Non-operating Income and Expenses

5. Future Outlook: ?Company Declaration

6. Future Outlook: ?2017 Strategies and Goals

6. Future Outlook: ?Opportunities in Automotive Market

6. Future Outlook: ?Vision

AI assistant

THINKING — Investor Presentation 2017

2017/5/18

Disclaimer

Agenda

1. THINKING Introduction

1. THINKING Introduction: ?Corporate Milestone

1. THINKING Introduction:? THINKING Group

1. THINKING Introduction: ?Global Sales Network

Notes:

2. THINKING Product:?Product Introduction

2. THINKING Product:?Product Introduction

2. THINKING Product:?Product Applications

2. THINKING Product:?THINKING Customers

3. Industry Advantages: ?High Global Market Share

Notes:

3. Industry Advantages:?Agency Approval of Product

Notes:

3. Industry Advantages:?UL Certified Laboratory

3. Industry Advantages:?Certification of Management System

Notes:

3. Industry Advantages: ?Automated Production Lines

3. Industry Advantages: ?Competitive Advantages

Notes:

4. Operation Overview: ?2016 Sales by Regions and Applications

4. Operation Overview: ?Consolidated Revenue of THINKING Group

4. Operation Overview: ?Yearly Consolidated Income Statement and ?Analysis of Operation Result

4. Operation Overview: ?Non-operating Income and Expenses

4. Operation Overview: ?Major Financial Indicator of Balance Sheet

4. Operation Overview: ?Cash Flow Statement for the Year

4. Operation Overview: ?Quarterly Consolidated Income Statement and Analysis of Operation Result

4. Operation Overview: ?Quarterly Non-operating Income and Expenses

5. Future Outlook: ?Company Declaration

6. Future Outlook: ?2017 Strategies and Goals

6. Future Outlook: ?Opportunities in Automotive Market

6. Future Outlook: ?Vision

More from THINKING

THINKING Investor Presentation 2017