THSRC — Investor Presentation 2016

Dec 7, 2016

Ticker Symbol: 2633

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Taiwan High Speed Rail Corporation

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Copyright © 2015 Taiwan High Speed Rail Corporation. All Contents Confidential.
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Disclosure

• The information contained in this presentation and its accompanying announcements, including its business outlook, financial position and business forecasts, is based on internal information and external economic developments as a whole.

• The Company's actual results of operations, financial condition and results of operations may differ from the forecasted information, which may be due to various factors including but not limited to market demand, changes in various policies and regulations and the overall economic situation, and other factors or risks the Company can not control.

• The information provided in this presentation reflects the Company's views about the future so far as not expressly or implicitly expressed or warranted as to its correctness, completeness, or reliability. The contents of the presentation, if any changes or adjustments occur in the future, the Company is not responsible for updates or amendments.

• For the convenience of readers, this presentation has been translated into English from the 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, the Chinese-language presentation shall prevail.

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AGENDA

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 CURRENT OPERATION OVERVIEW

 FINANCIAL PERFORMANCE

 PROSPECT

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CURRENT OPERATION OVERVIEW

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1. MARKET SHARE

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Year 2013	Short Distance （20~100km）	Medium Distance （100~200km）	Long Distance （200km+）
Weekday
Weekend & Holiday

Source: The 5th Taiwan Area Comprehensive Transportation Planning Research Series - Intercity Travel Survey and Preliminary Analysis, Institute of Transportation, MOTC

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2. OPERATION PERFORMANCE

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1) Train Frequency

Daily Frequency

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2) Ridership & Loading Factor

(’000/Day)

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(%)
5.3%
1.1%
6.7%
7.0%
12.7%
14.2%
5.8%
96.6%
 1~9/’16 Ridership: YoY+12.3%
 Loading factor appears to be on a course
of long-term stable growth.
(vs JR Central: 64.3% @FY’15)
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3) Average Train Delay Time

(min)

(%)	'07	'08	'09	'10	'11	'12	'13	'14	'15	1~9/'16
Punctuality (Delay<5min)	99.47	99.19	99.25	99.22	99.86	99.40	99.38	99.61	99.66	99.28

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4) Operation Performance to Date

ITEM 2007.1 ~ 2016.10 Accidents with Liability 0 Train Services 452,362 Trains Ridership 394 million passengers Reliability 99.95% (excluding natural disaster) Punctuality 99.57% (excluding natural disaster, delay<5 min.) Average Train Delay Time 0.23 minutes (Per JR East 2015 annual report, average train delay time in FY’15 is 0.6 min)

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3. MARKETING STRATAGIES

1) Structure

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2) The Production against Trip Purpose

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Source: Year 2015 high-speed rail passenger satisfaction survey.

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1. CORPORATE GOVERNANCE AND CORPORATE SOCIAL RESPONSIBILITY (1/2)

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1. CORPORATE GOVERNANCE AND CORPORATE SOCIAL RESPONSIBILITY (2/2)

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FINANCIAL PERFORMANCE

Copyright ©Copyright © 2015 Taiwan High Speed Rail Corporation. All Contents Confidential. 2015 Taiwan High Speed Rail Corporation. All Contents Confidential.

1. SHAREHOLDING STRUCTURE

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Gov’t agencies and gov’t-owned institutions hold 63.54% stake, ensuring the operation and finance stability.

Before Financial Resolution Project After Financial Resolution Project

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Government
Agencies
12.28% [Government-owned ] Government Agencies Government-owned
Institutions 48.68% Institutions
9.85% 14.86%
Others
41.46%
Founders
16.86%
Founders
36.41% Others
19.60%
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2. STATEMENTS OF INCOME

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(NT$mn)	1-9/’16	1-9/’15	Variance Amount	Variance %
OperatingRevenues	30,062	29,841	221	0.7%
OperatingCosts	(19,126)	(22,828)	3,702	16.2%
Gross Profit	10,936	7,013	3,923	55.9%
OperatingExpenses	(682)	(613)	(69)	-11.3%
Income from Operations	10,254	6,400	3,854	60.2%
Non-OperatingIncome & Expenses	(6,498)	(7,415)	917	12.4%
Income Before Income Tax	3,756	(1,015)	4,771	470.0%
Income Tax Benefit(Expense)	(629)	224	(853)	-380.8%
Net Income	3,127	(791)	3,918	495.3%
EPS	0.56	(0.30)

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3. HISTORICAL OPERATING REVENUES & NET INCOME

(NT$bn)

• 1~9/’16 Operating Revenues: YoY+0.7%

 1~9/’16 Net Income: NT$3.1bn (YoY:+NT$3.9bn)

Note: Year 2015 operating revenues excluding the compensation of $12.1bn on statutory discount tickets were $39.8bn.

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4 、 EBITDA & EBITDA Margin

EBITDA

(NT$bn)

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EBITDA Margin (%)

Note: Year 2015 EBITDA above excludes the compensation of $12.1bn om statutory discount tickets.

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PROSPECT

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FUTURE GROWTH MOMENTUM

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• Creating Value for Customers.

• Increase ridership and revenue.

 Mutual benefits with the significant development and construction plans in the west corridor of Taiwan.

 Towards sustainable development. Contract Construction Operation 8.5-Year 26.5-Year + 35-Year Year 1998 Year 2007 Year 2033 Year 2068

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1 、 Creating Value for Customers

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Apply advanced technologies including big data and Internet of Things (IoT) to:

• Build intelligent transportation systems with Customer Service Cloud and Operation Management Cloud.

• Enhance operational safety and service quality, and bring excellent traveling experience to passengers.

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Smart Train
Operations
Integrated THSRC ITS Smart Safety
i-Traveling & Emergency
Smart Railway
Information Management
Services System
Smart Smart
Passenger Ticketing
Services Services
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1. INCREASE RIDERSHIP AND REVENUE Strengthening service quality and launching effective marketing campaigns to increase the revenue and ridership.

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3. MUTUAL BENEFITS WITH THE SIGNIFICANT DEVELOPMENT AND CONSTRUCTION PLANS IN THE WEST CORRIDOR OF TAIWAN

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4 、 TOWARDS SUSTAINABLE DEVELOPMENT

 Cooperating with domestic universities and R&D institutions to set up a railway equipment laboratory.

Strengthen In-House

 Cooperating with Japan Railways to accelerate technology convey.

Maintenance  Establishing electronics, machinery, welding and other factories to Capability strengthen in-house maintenance capacity.

 Implement Seeking alternative sources of key materials. Materials  Cooperating with domestic R&D institutions to develop alternative Localization materials.

Localization

 Hosting the International High-Speed Railway Association (IHRA) Technology Annual Conference to enhance the international cooperation in the and industry and export of operation and maintenance technology. Experience  Participating in International Union of Railways (UIC) to build a new Exchange benchmark for the railway industry in response to natural disasters with international railway operators.

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CONCLUSION

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To make Taiwan High Speed Rail as high-quality 4T cultural and creative life style, and as the model of domestic public transportation business.

 Transportation

•  Technology

•  Taiwan

•  Touch

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The End

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