THSRC — Interim / Quarterly Report 2021

Nov 26, 2021

Ticker Symbol: 2633

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Taiwan High Speed Rail Corporation 3Q, 2021 Operation Report

11/29/2021

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Copyright © Taiwan High Speed Rail Corporation. All Contents Confidential.
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Safe Harbor Notice

• The information contained in this presentation and its accompanying announcements, including content relating to business outlooks, financial operations, and business forecasts, is based on information derived from internal corporate data and external economic developments as a whole.

• The Company's actual operations, financial conditions, and operational performance may differ from forecasted information; this may be due to various factors including but not limited to market demand, changes in policies and regulations and overall economic conditions, and other factors or risks beyond the Company’s control.

• The information provided in this presentation reflects the Company's current views about the future; correctness, completeness, or reliability of said views are not explicitly or implicitly expressed or warranted. The Company is not responsible for updating or amending changes or adjustments made to the contents of this presentation, if such changes or adjustments should occur in the future.

• For the convenience of readers, this presentation has been translated into English from an original Chinese version. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, information in the Chinese-language presentation shall prevail.

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AGENDA

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I. BUSINESS OVERVIEW II. FINANCIAL OVERVIEW III. OPERATIONAL OVERVIEW

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I. BUSINESS OVERVIEW

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1. High-Speed Rail Network 2. Operational Performance

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1. High-Speed Rail Network

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Operation Area 11 Cities

Population 90 %

Route Length (km) 350

Stations 12

Maintenance Bases 5

Train Model 700T

Total Train Sets 34

Maximum Speed 300 km/h Business Scope of THSRC Item Content Passenger Transportation Offers direct train, semi-direct train, and stopping train transport. Service Operation of Affiliated Retail space leasing(convenient stores, food and beverage, etc.), retail, parking lots Services at stations, trolley sales, advertising sales(lightboxes, wall space, column space, product displays, train decorations, etc.).

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2. Operational Performance

1. Train Frequency

(Daily Frequency)

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Daily Two-way Service (WEEKEND) 每日雙向列車班次數 (WEEKDAY) Daily Two-way Service (WEEKDAY)

166 133

 A total of 1,016 weekly train services were scheduled since July 2019.  In response to the latest pandemic situation and government’s anti-epidemic measures, a train schedule adjustment was carried out on Nov. 8, 2021 to restore the frequency of trains to 1,016 per week and resume the nonreserved seat services.

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2. Trend of Transportation Capacity & Volume

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Train Services
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Seat-Km
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(mn-km)
13.8%
15.0%
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(Frequency)
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Transportation
Capacity
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Ridership

Passenger-Km

(thousand persons)

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(mn-km)
26.9%
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Transportation
Volume
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27.1%
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3. Ridership & Loading Factor

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(thousand persons/day)

Load Factor, (%)

• Daily Avg. Ridership：1~3Q‘21 YoY - 26.8%

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4. Operational Performance

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	2021.01.01 ~ 2021.9.30	2007.01.05 ~ 2021.9.30
Train Services	33,985	705,721
Cumulative Passengers (millionpassengers)	29.4	682.8
Passenger Kilometers (million-km)	5,115	129,411
Loading Factor	46.44%	56.33%
Reliability	100%	99.69%
Punctuality (delay<5 min)	98.73%	99.47%
Avg. Delay Time (min)	0.33	0.2
Accidents resulting in Liabilities	0	0

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• II. FINANCIAL OVERVIEW 1. Financial Performance

2. Financial Risk Management

3. Corporate Credit Rating & Market Cap 4. Recent Major Events

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1. Financial Performance

1. Income Statement

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(NT$mn)	1~3Q'2021	1~3Q'2021	1~3Q'2020	1~3Q'2020	Variance Amount	YoY %
Operatingrevenue	20,577	100%	27,629	100%	(7,052)	-25.5%
Operatingcosts	(19,222)	-94%	(19,371)	-70%	149	-0.8%
Gross Profit	1,355	6%	8,258	30%	(6,903)	-83.6%
Operatingexpenses	(893)	-4%	(859)	-3%	(34)	4.0%
Net OperatingIncome	461	2%	7,399	27%	(6,938)	-93.8%
Non-operating income and expenses
Interest expenses	(4,300)	-21%	(4,481)	-16%	181	-4.0%
Stabilization reserve	6,872	34%	(251)	-1%	7,123	-2837.8%
Others	112	1%	315	1%	(203)	-64.4%
Net Income before tax	3,146	15%	2,982	11%	164	5.5%
Income tax	(440)	-2%	294	1%	(734)	-249.7%
Net Income	2,705	13%	3,276	12%	(571)	-17.4%
EPS	0.48		0.58

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２. Net Profits & Operating Revenues

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1) Revenue Structures

(NT$bn)	1~3Q'21	1~3Q'20	YoY%
Railway Revenue	19.73	26.73	-26.2%
Non-railway Revenue	0.85	0.90	-5.0%
Total	20.58	27.63	-25.5%

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Note: Non-railway revenues mainly include rental incomes, advertising revenues, and onboard sales

2. Net Profits & Operating Revenues

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2) Operating Revenue, Gross Profit & Net Income

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(NT$bn)
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(%)
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3. EBITDA & EBITDA Margin

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(NT$bn)
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(%)
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 EBITDA

• 1~3Q‘21： YoY - 38.2%

 EBITDA Margin

• Due to the pandemic impact, nationwide epidemic alert had raised to Level 3, revenue fell during 2Q’21 and 3Q’21. As a result, EBITDA Margin of 1~3Q’21 reduced to 54.2%.

4. Balance Sheets

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(NT$mn)	2021.9.30	2020.12.31	2020.9.30
Current assets	60,323	38,621	32,074
Operating concession asset	369,686	378,291	380,808
Other non-current assets	10,197	10,654	10,266
Total assets	440,207	427,567	423,148
Current liabilities	28,275	7,067	5,344
Non-current liabilities	345,049	350,413	350,262
Total liabilities	373,324	357,480	355,606
Common stock	56,283	56,283	56,283
Capital surplus	173	173	173
Legal reserve & unappropriated earnings	10,426	13,631	11,086
Total equity	66,882	70,087	67,542
Total liabilities & equity	440,207	427,567	423,148

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5. Statement of Cash Flows

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(NT$mn)	2021.9.30	2020.12.31	2020.9.30
Cash & cash equivalents at the beginningof theperiod	652	16,272	16,272
Cash flows from operating activities	21,932	(1,532)	(6,126)
Cash flows from investing activities	7,214	821	6,051
Cash flows from financing activities	17,996	(14,909)	(14,914)
Net increase in cash & cash equivalents	47,141	(15,620)	(14,988)
Cash & cash equivalents at the end of theperiod	47,793	652	1,283

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2、Financial Risk Management

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(%)
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3. Corporate Credit Ratings & Market Cap

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(US$bn)
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Oct. 2021 Market Cap $164.0 bn (≒US$5.4bn)

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4、Recent Major Events

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Date Events  THSRC issued a 2021 first unsecured corporate bond, comprised of NT$ 4 bn for Tranche A, with an issuance period of 3 years at a fixed interest rate of 0.32% p.a., and NT$ 4 bn for Tranche B, with an issuance period of 4 years at a fixed interest of 0.35% p.a. 2021.7  THSRC entered into non-guaranteed commercial paper underwriting agreements with three bills finance companies, enabling the Company to issue non-guaranteed commercial paper (up to 90 days) on a revolving basis during a period of 5 years. The total underwriting amount is NT$ 15 bn.  The 2020 cash dividend distribution proposal has been approved by 2021 Annual Shareholders’ Meeting, each common share is entitled to receive a cash dividend of NT$ 1.05. 2021.8  THSRC issued a 2021 second unsecured corporate bond (Sustainability Bond), comprised of NT$ 1 bn, with a maturity of 3 years and a fixed coupon rate of 0.30%.

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III. OPERATIONAL OVERVIEW 1. Post-Pandemic Operational Growth Strategies

2. CSR Performance

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1、Post-Pandemic Operational Growth Strategies

 To meet the demand of various passengers, THSRC provides diversified tourism products, expand scope of channels, optimize mobile ticketing platform, and strengthen THSR brands to increase operational growth.

• Product Launch diversified products in domestic tourism market, such as T Holiday and combo tickets (hotel, local travel, overseas).

• Launch diversified products in domestic tourism market, such as T Holiday and

• Implement market demand products (THSR+Michelin route).

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Cost
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• Seek to lower capital cost to reduce financial expenses.

• Promote localization of railway industry and enhance local component suppliers to

reduce operational costs.

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Channel
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• Expand travel e-commerce platform channels.

• Increase resource sharing with external channels to create more benefits.

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Promotion
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• Launch the “5000 Quintuple Stimulus Voucher”promotion program.

• Promote the TGo membership program to build TGo membership economy and develop

precision marketing.

２. CSR Performance

ESG（Environmental、Social、Governance）Promote and Awards

• 2021.07 Continued to be selected as a constituent of the "FTSE4Good Index Series.“

• 2021.04 Ranked top 5% in Corporate Governance Evaluation for the fourth consecutive years.

• 2021.03 For the past 12 years, the “High-Speed Educational Endowment Program” has been in collaboration with the Down Syndrome Foundation to raise an amount of more than NTD 148 million and is estimated to have helped more than 27,000 disadvantaged schoolchildren achieve their dreams of learning.

• 2021.01 The THSRC e-procurement, a paperless procurement process, was introduced to implement environmental protection and to promote sustainable supply chain development.

• 2020.12 The first domestic railway company to obtain Environmental Management System (EMS) certification from the British Standards Institute (BSI).

• 2020.07 Awarded excellent certification under the Corporate Governance Evaluations, hosted by the Taiwan Corporate Governance Association.

• 2020.07 Continued to be selected as a constituent of the “TWSE CG 100 Index.”

• 2020.06 Continued to be selected as a constituent of the “FTSE4GOOD TIP Taiwan ESG Index.”

• 2014.11 Awarded with the carbon footprint certificate for high-speed rail service, THSR was the first domestic transportation mode to obtain the carbon label.

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Conclusion

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Vision: To be the platform for advancement and enjoyment.

Integrate technology into services for new 4T smart and convenient life. THSRC strives to be one of the top ten brands in Taiwan.

運輸 To build professional transportation systems that provide high quality . T services and products ransportation

科技 To implement intelligent transportation that improves operational efficiency T and quality, and enhances services, safety, and emergency responses. echnology

在地 To combine unique local cultures and landscapes to create a multicultural T aiwan platform. 關懷 To establish brand culture, enhance talent skills and corporate efficiency, T ouch and participate in social caring and environmental protection.

To combine unique local cultures and landscapes to create a multicultural platform.

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To learn more about THSRC, please visit http://www.thsrc.com.tw

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