WEC — Interim / Quarterly Report 2016

Jul 28, 2016

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Winbond Electronics Corporation

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Safe Harbor Notice

• We have made forward-looking statements in this presentation. Our forward-looking statements contain information regarding, among other things, our financial condition, future expansion plans and business strategies. We have based these forwardlooking statements on our current expectations and projections about future events. Although we believe that these expectations and projections are reasonable, such forward-looking statements are inherently subject to risks, uncertainties and assumptions about us.

• We undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this conference might not occur and our actual results could differ materially from those anticipated in these forward-looking statements.

• The information contained herein shall also not constitute an offer to sell or a solicitation of an offer to buy the company’s securities nor shall there be any sale of such securities in any state or country in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or country.

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Financial Results

1H16 Statement of Comprehensive Income - Consolidated

	2Q’16			1Q’16			1H’16			1H’15			YoY
Unit: NT$ M	Amount		%	Amount		%	Amount		%	Amount		%	Amount		%
Net Sales	10,497		100	10,087		100	20,584		100	18,976		100	1,608		8
Gross Profit	2,965		28	3,038		30	6,003		29	6,086		32	(83)		(1)
Operating Income	887		8	1,006		10	1,893		9	2,260		12	(367)		(16)
Pretax Income	889		8	999		10	1,888		9	2,336		12	(448)		(19)
Net Income	744		7	808		8	1,552		8	1,900		10	(348)		(18)
EPS (NT$)	0.18			0.22			0.40			0.49
EBITDA	2,307		22	2,466		24	4,773		23	5,169		27	(396)		(8)

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1H16 Balance Sheet - Consolidated

Unit: NT$ M Current Assets Net Fixed Assets Total Assets L/T Debt Total Equity Current Ratio Debt / Equity Ratio	Jun. 30 ’16 Mar. 31 ’16 Dec. 31 ’15 Jun 30’16 vs Dec 31’15 Amount % Amount % Amount % Amount % 26,409 42 26,374 41 24,713 39 1,696 7 30,608 49 31,280 49 31,915 51 (1,307) (4) 63,053 100 63,610 100 62,598 100 455 1 7,866 12 8,758 14 8,755 14 (889) (10) 41,994 67 41,431 65 40,099 64 1,895 5 2.25 2.20 2.00 0.50 0.54 0.56

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1H16 Statement of Cash Flows - Consolidated

Unit: NT$ M Operating Cash Flow Investing Cash Flow Financing Cash Flow Cash & Equivalents Depreciation and Amortization CAPEX	2Q’16 1Q’16 1H’16 1H’15 YoY Amount Amount Amount Amount Amount 2,499 1,723 4,222 3,594 628 (707) (995) (1,702) (2,554) 852 (1,591) (2) (1,593) (1,055) (538) 7,325 7,108 7,325 6,915 410 1,420 1,460 2,880 2,909 (29) (775) (796) (1,571) (2,084) 513

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1H16 Statement of Comprehensive Income - Memory

	2Q’16			1Q’16			1H’16			1H’15			YoY
Unit: NT$ M	Amount		%	Amount		%	Amount		%	Amount		%	Amount		%
Net Sales	8,231		100	8,173		100	16,404		100	15,342		100	1,062		7
Gross Profit	1,943		24	2,195		27	4,138		25	4,423		29	(285)		(6)
Operating Income	640		8	867		11	1,507		9	1,949		13	(442)		(23)
Pretax Income	742		9	920		11	1,662		10	2,151		14	(489)		(23)
Net Income	643		8	776		9	1,419		9	1,801		12	(382)		(21)
EPS (NT$)	0.18			0.22			0.40			0.49
EBITDA	1,996		24	2,264		28	4,260		26	4,736		31	(476)		(10)

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1H16 Balance Sheet - Memory

Unit: NT$ M Current Assets Net Fixed Assets Total Assets L/T Debt Total Equity Current Ratio Debt / Equity Ratio	Jun. 30 ’16 Mar. 31 ’16 Dec. 31 ’15 Jun 30’16 vs Dec 31’15 Amount % Amount % Amount % Amount % 20,630 35 20,838 34 19,345 33 1,285 7 29,910 50 30,569 51 31,195 52 (1,285) (4) 59,534 100 60,407 100 59,496 100 38 0 7,866 13 8,758 14 8,755 15 (889) (10) 40,785 69 40,206 67 38,902 65 1,883 5 2.09 1.99 1.78 0.46 0.50 0.53

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1H16 Statement of Cash Flows-Memory

Unit: NT$ M Operating Cash Flow Investing Cash Flow Financing Cash Flow Cash & Equivalents Depreciation and Amortization CAPEX	2Q’16 1Q’16 1H’16 1H’15 YoY Amount Amount Amount Amount Amount 2,201 1,457 3,658 3,303 355 (645) (872) (1,517) (2,446) 929 (1,586) 0 (1,586) (1,048) (538) 4,190 4,220 4,190 3,955 235 1,356 1,397 2,753 2,787 (34) (749) (764) (1,513) (2,012) 499

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Revenue and GM Trend- Consolidated

Revenue (NT$B)

Gross Margin

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35%
24 32%
30% 30%
29%
27% 30%
20
22% 25%
20%
16
20%
12
21 15%
19
18 19
8 19
10%
17
17
4 5%
0%
0
1H'13 2H'13 1H'14 2H'14 1H'15 2H'15 1H'16
Revenue Gross Profit GM%
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Revenue and GM Trend- Memory

Revenue (NT$B)

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Gross Margin
18
35%
16
29%
14 30%
26%
26% 25%
23%
12 25%
10
16% 20%
14% 16
8 16
16
15 15%
15
6
13
13
10%
4
5%
2
0 0%
1H'13 2H'13 1H'14 2H'14 1H'15 2H'15 1H'16
Revenue Gross Profit GM%
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Y2016 Memory CAPEX

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(NT$ B)
13.0
14.0
12.0
8.5
10.0
8.0 6.0
6.0 3.9
3.0
2.1
4.0
2.0
0.0
2011 2012 2013 2014 2015 2016 (E)
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CAPEX(Cash Basis) as of 06/30/2016

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Winbond Business Update & Outlook

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1H16 Memory Business Recap

HoH YoY Revenue +6% +8% Gross Profit +3% -7%

• Revenue increased due to improving product mix and customer mix

• Gross margin dropped YoY, mainly due to capacity loss.

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1H16 Revenue Breakdown by Application

Car & Industrial

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16%
Communication
34%
Consumer
25%
Computer
25%
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Note: Revenue excluded foundry and others

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Car & Industrial Consumer Computer Communication
-
HoH +3% HoH +8% HoH 7% HoH +16%
-
YoY +23% YoY +7% YoY 5% YoY +9%
NT$M NT$M NT$M NT$M
3,000 3,000 4,500 6,000
2,500 4,000 5,500
2,500
2,000 3,500 5,000
1,500 2,000 3,000 4,500
1,000 2,500 4,000
1,500
500 2,000 3,500
0 1,000 1,500 3,000
2015H1 2016H1 2015H1 2016H1 2015H1 2016H1 2015H1 2016H1
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1H16 Revenue Breakdown by Product

Revenue (NT$B)

18.0 16.0 14.0 36% 35% 35% 37% 36% 12.0 40% 42% 10.0 8.0 51% 54% 6.0 52% 52% 53% 45% 50% 4.0 2.0 13% 11% 12% 11% 12% 11% 13% 0.0 1H'13 2H'13 1H'14 2H'14 1H'15 2H'15 1H'16

HoH YoY Flash +4% +9% Specialty +2% +5% Mobile +32% +15%

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1H16 Revenue Breakdown by Geometry

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Specialty DRAM
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Mobile DRAM
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Mobile DRAMFlash Memory
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100%
80%
60% 86% 90%
40%
20%
14%
10%
0%
2015H2 2016H1
65nm 46nm
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100% 100% 8% 13%
80% 80%
61%
67%
55%
52%
60% 60%
40% 40%
37%
20% 31% 20% 37% 35%
2% 2%
0% 0%
2015H2 2016H1 2015H2 2016H1
90nm 65nm 46nm 90nm 58nm 46nm
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1H16 Specialty DRAM Business

HoH YoY Revenue +2% +5%

• Revenue from TV and NTWK remained strong

• Automotive and industrial applications contributed higher growth of revenue

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1H16 Mobile DRAM Business

HoH YoY Revenue +32% +15%

• Design-win from tier-1 customer

• Demand from ASIC products increased

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1H16 Flash Memory Business

HoH YoY Revenue +4% +9%

• Business in NTWK application continued expanding

• Demand for high-density products (1Gb above Code Storage Flash) increased

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DRAM Maker Benchmark

	GM %	GM %	GM %	Change	Change
Vendor	2Q16	1Q16	2Q15	QoQ	YoY
A company	32%	36%	46%	-4%	-14%
B Company	17%	20%	31%	-2%	-14%
C company	28%	33%	42%	-4%	-14%
Winbond	24%	27%	29%	-3%	-5%

• GM% of Winbond Specialty DRAM business maintains stable even without any technology migration in last 6 years

• Self-developed 3x nm DRAM technology will be released in Q4/2016

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Winbond Business Outlook

• Maintain stable business in 2H, with continuous focus on KGD, Automotive, Industrial and MCP.

• Competitiveness and Profitability in DRAM business will be enhanced from 2017, after self-developed 3x nm DRAM technology is released in Q4/2016.

• Increasing business in tier-1 customers in Mobile DRAM

• Code storage Flash business maintain stable with good product quality and diversified applications/customers

• Increasing business in Gb code storage Flash and Flash+DRAM MCP