UIC — Investor Presentation 2017

Nov 20, 2017

Uniform Industrial Corporation

Disclaimer

The forward-looking statements contained in this presentation are subject to risks and uncertainties; therefore, actual results may differ materially from those expressed or implied in these forward-looking statements.

Uniform Industrial Corporation makes no representation or warranty as to the accuracy or completeness of these forward-looking statements and nor does Uniform Industrial Corporation undertake any obligation to update any forwardlooking statements, whether as a result of new information or future events.

Outline

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Company profile Market Positioning Growth Opportunity and Future Outlook Financial Statement Q & A

Company profile

UIC aims to build and provide the world’s safest, most reliable and complete turnkey in Electronic Payment . Through its unique products and market application, UIC has perfect, unique, seasoned, and irreplaceable experiences to offer payment solutions satisfying customers’ needs.

30+ 250+ 3 years of employees regional experience worldwide sales offices 10+ 90+ 91K ft[2 ] RD engineers years of in-house EMV/PCI manufacturing

90+ RD engineers

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The 34-year Company History

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1983 Established IC Packaging Business 1988 ODM and manufacturing Magnetic Card Reader for IBM POS 1993 Focus on MSR products and components and build R&D fundamentals UIC USA office established 1994 Accomplished own facility in Tu-Cheng Industrial 1995 ISO9002 certified 1996 Setup Automatic SMT line 1998 ISO9001:2000 certified Setup EMI pre-scan and debugging Shielding Room 1999 IPO in Taiwan on December 22 2002 ISO9001:2000 upgrade 2006 ISO14001:2004 certified RoHS production ready 2007 Acquired HHP check Reader product line 2012 Accomplished UIC Europe office 2013 Setup Cloud Technology Center 2016 Accomplished UIC Australia office 2017 Payment Gateway in Taiwan (PCI DSS certificate)

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Product Overview

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1. Contactless/POS MSR/ICCR

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** Pictures are illustrated for reference

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Contactless Reader

Secure MSR Reader

Insertion Reader

Hybrid Reader

MSR Chip-in-Head

2. Retail & Merchant Service

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Signature

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Slave/Standalone PIN pad

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Customer Facing Payment Terminal Terminal

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3. Unattended Device

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Secure Encrypted PIN Pad

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Slave/Standalone Contactless Reader

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3 in 1 Advanced

Contactless Device

Certifications

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Application and Successful Cases

1. Vending Cashless Payment

Application

• Payment bezel for vending machines

• Cashless contact and contactless scenario

Offering

• UIC cashless module embedded in customers bezel

• enclosure

• Semi assembly service

Successful Factor

• Developed the world first contactless/MSR payment reader for vending in 2007

• Deployed over 20,000 contactless/MSR payment reader since 2007

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• Over 60,000 contact/contactless/MSR payment readers deployment in 2012

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2. Parking Meter and Parking Lot

Application

• US major airport parking lot

• US city roadside parking meter

• Parking meter and parking ticketing system

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Offering

• UIC contactless module embedded in customers

• enclosure

• Specific antenna design

Successful Factor

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• Over deployed thousand modules in airport parking meter

• Certified several trail runs in major city for roadside parking meter

• Not only payment but also security access comprehensive application in airport parking area

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3. Gas Station / EV Charging

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Application

• Contactless payment for EV charging station

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• Petrol station cashless payment

Offering

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• UIC cashless module embedded in customers bezel enclosure

• Semi assembly service

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Successful Factor

• Developed the world first contactless payment reader for EV charging station

• Deployed over 10,000 readers since 2010

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4. Embedded Module Design-in

Application

• Aircraft payment for LiveTV

• Players tracking system in Casino

• Peripherals with MSR integration

Offering

• MSR module

• Insertion card module

• Customized dimension and outline

Successful Factor

• Deployed over 25,000 MSR for one airline

• Deployed over 100,000 readers for casino since 2004

• Deployed over million modules for comprehensive devices

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5. Retailing and Banking

Application

• Retail countertop payment terminal

• Banking countertop PIN and payment application

• Finance control via terminal

Offering

• Terminal

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• PIN pad

• Highly customization on terminal software and firmware

Successful Factor

• Collaborate with worldwide major gateways and processors for market trail

• Deployed over thousand units PIN pad

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• Provide TMS and ERC as turnkey solution

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6. Marchant total solution

Application

• Cloud POS with payment (will launch in 2018 )

• High integration of Payment/POS device

• Pay/Order-at-Table

Offering

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• MSR

• HCR insertion

• PIN pad

Successful Factor

• MSR series reputation

• Flexible customization design

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• Understand POS markets

Market Positioning

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Cashless Payment Device & Solution Provider

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Opportunity and Future Outlook

Payment Terminal Market Trend

Global Payment Terminal Market Revenue By Region, 2017 (US$ Bn)

The Top 7 in US Region

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Payment Terminal Shipments by Region 2016

Payment in FinTech

6 Functions of Financial Services 11 Clusters of Innovation

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World Economic Forum
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Cashless in Payment

Disruptive innovation in financial services

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Cashless World

Disruptive innovation in financial services

World Economic Forum

Financial Statement

P&L Summary

NT$ (expressed in thousands)	2014	2015	2016	2017 1-3Q	Growth YoY	Growth YoY	Growth YoY
					2015	2016	2017 1-3Q
Sales Revenue	733,106	844,640	886,306	599,730	15%	5%	(11%)
Gross Profit	260,288	360,210	411,519	263,004	38%	14%	(14%)
Operating Profit	(37,772)	6,409	21,807	(40,616)	117%	240%	(341%)
Income Before Tax	(14,005)	17,909	32,921	(53,761)	228%	84%	(453%)
Net Income to Parent Shareholders	(10,775)	15,612	18,769	(55,227)	245%	20%	(542%)
EPS (NT$)	(0.17)	0.25	0.30	(0.89)
Gross Margin %	35.5%	42.6%	46.4%	43.9%
Operating Margin %	(5.2%)	0.8%	2.5%	(6.8%)
Net Margin %*	(1.5%)	1.8%	2.1%	(9.2%)

• Net Margin % =Net Income (attributed to parent shareholders) ／ Sales Revenue

P&L Summary (by quarter)

	Q1	Q2	Q3	Total	Growth QoQ	Growth QoQ	Growth QoQ	Growh YoY
					Q1	Q2	Q3
2017
Sales Revenue	186,254	212,546	200,930	599,730	(10%)	(2%)	(19%)	(11%)
Gross Profit	86,779	87,699	88,526	263,004	(17%)	(7%)	(16%)	(14%)
Operating Profit	(15,172)	(12,680)	(12,764)	(40,616)	(215%)	(615%)	(335%)	(341%)
Income Before Tax	(30,790)	(10,487)	(12,484)	(53,761)	(380%)	(329%)	(3851%)	(453%)
Net Income to Parent Shareholders	(30,719)	(10,964)	(13,544)	(55,227)	(435%)	(384%)	(2381%)	(542%)
2016
Sales Revenue	207,972	217,979	247,768	673,719
Gross Profit	104,735	94,703	105,348	304,786
Operating Profit	13,188	(1,774)	5,422	16,836
Income Before Tax	10,989	4,574	(316)	15,247
Net Income to Parent Shareholders	9,168	3,863	(546)	12,485

Consolidated Revenue

						2016					2017	2017
				Q1		Up to Q2	Up to Q3			Q1	Up to Q2			Up to Q3
	※	US$(K)		6,275		12,993 20,776				6,196		13,012		19,628
		Exchange rate		33.143		32.784 32.428				30.058		30.648		30.512
	Domestic currency	NT$(K)		207,972		425,951 673,719				186,254		398,800		598,904
										YoY
						Q1				Up to Q2		Up		to Q3
	※		US$(K)			(1.3%)				0.1%				(5.5%)
			Exchange rate			(9.3%)				(6.5%)				(5.9%)
	Domestic currency		NT$(K)			(10.4%)				(6.4%)				(11.1%)

※ Transferred into USD with average exchange rate.。

Q & A

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Thank You