WT — Interim / Quarterly Report 2019

Feb 19, 2019

2018 Fourth Quarter Investor Conference

Presented by Cheryl Yang February 19, 2019

Safe Harbor Statement

• WT’s forward-looking statements, which may include statements regarding its results of operations, financial condition or business prospects, are subject to significant risks and uncertainties and are based on WT’s current expectations.

• Actual results may differ materially from those expressed or implied in these forward-looking statements for a variety of reasons, including, among other things: the cyclical nature of our industry; our dependence on introducing new products on a timely basis; our dependence on growth in the demand for our products; our ability to compete effectively; our dependence on key personnel; general economic and political conditions; possible disruptions in commercial activities caused by natural and human-induced disasters, including terrorist activity and armed conflict; and fluctuations in foreign currency exchange rates.

• In addition, any financial information contained here within is presented in conformity with International Financial Reporting Standards (IFRSs).

• Except as required by law, our release of financial forecasts and forward-looking statements at any particular time does not create any duty of disclosure, and we expressly disclaim any obligation to publicly update or revise any forecasts or forward-looking statements, whether as a result of new information, future events or otherwise.

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Agenda

1. Overview

2. Financial Update

3. Business Outlook

4. Recap of Recent Major Events

5. Questions and Answers

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1. Overview

Strong secular growth with economies of scale

• A leading Asian semiconductor distributor, founded in 1993 and listed in 2000 (ticker: 3036 TT)

• Strategic focus on Asia region and Automotive & Internet of Things (IoT) applications

• 2018 revenues of NT$273bn, up 44% YoY

• 48 offices in Asia (33 offices in China and 15 offices in Korea, Taiwan, and South Asia) with over 8,000 customers

• Over 2,300 headcounts in 4Q18 (over 700 sales, 250 PMs, and 500 FAEs)

• Completion of warehouse semi automation (total 6 warehouses in Taiwan, HK, Shenzhen China, Shanghai China, Korea, and Singapore)

• Completion of B2B service platform for major vendors and customers

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1. Overview

Harbin China Offices (33) Korea Offices (2) Shenyang Dalian Offices Across Asia Seoul Beijing Tianjin Qingdao Taiwan Offices (4) Yantai Zhengzhou Taipei, Headquarters Jinan Hsinchu Xian Ningbo Taichung Shanghai Wuxi Tainan Suzhou Kunshan South Asia Offices (9) Nanjing Hangzhou New Delhi, N. India Wenzhou Hefei Mumbai, N. India Chengdu Mianyang Pune, N. India Chongqing Changsha Vietnam (2) Wuhan Fuzhou Bangalore, S. India Fuqing Xiamen Bangkok, Thailand Dongguan Shunde Penang, Malaysia Guangzhou Zhuhai Singapore Hong Kong Shenzhen

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1. Overview

NR (Net Revenue)

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YoY=44%
NT$B
300
273
YoY=31%
250
YoY=27%
200 189
CAGR(2011~2015)=12%
CAGR(2006~2010)=16%
144
150
108 [114 ]
100 88
80
71
64
47
50 34 39 41
30
21
5 9 10 14
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
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2. Financial Update

2018 result highlights

• Strong revenue growth of 44% YoY

• Solid operating profit growth of 34% YoY

• Stable net profit growth of 10% YoY

• Return on net working capital improved 2.3ppt YoY to 11.9%

• Operating cash cycle reduced 14 days YoY to 58 days

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2. Financial Update

Statement of Comprehensive Income

Unit: NT$M

K t	4Q18	4Q18	3Q18	QQ	4Q17	YY
ey accouns	Amount %	Guidance	Amount %	o	Amount %	o
Net Operating revenues Gross profit Operating expenses Operating income Financing costs Others Earning before tax Income tax expense Non-Controlling Interests Profit after tax EPS (in dollars)	85,762 100.00% 2,705 3.15% (1,420) -1.65% 1,285 1.50% (538) -0.63% 19 0.02% 766 0.89% (175) -0.20% - - 591 0.69% 1.06		84,771 100.00% 3,096 3.65% (1,392) -1.64% 1,704 2.01% (431) -0.51% (17) -0.02% 1,256 1.48% (268) -0.32% - - 988 1.16% 1.79	1% -13% 2% -25% 25% -39% -35% -40%	59,844 100.00% 2,456 4.10% (1,373) -2.29% 1,083 1.81% (318) -0.53% 94 0.16% 859 1.44% (156) -0.26% - - 703 1.18% 1.44	43% 10% 3% 19% 69% -11% 12% -16%

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2. Financial Update

Statement of Comprehensive Income

Unit: NT$M

Key accounts	Y2018		Amount % Y2017	YoY
	Amount %
Net Operating revenues Gross profit Operating expenses Operating income Financing costs Others Earning before tax Income tax expense Non-Controlling Interests Profit after tax EPS (in dollars)	273,416 100.00% 10,649 3.89% (5,391) -1.97% 5,258 1.92% (1,698) -0.62% 61 0.02% 3,621 1.32% (842) -0.31% - - 2,779 1.01% 5.02		189,419 100.00% 8,421 4.45% (4,503) -2.38% 3,918 2.07% (963) -0.51% 150 0.08% 3,105 1.64% (585) -0.31% - - 2,520 1.33% 5.26	44% 26% 20% 34% 76% 17% 44% 10%

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2. Financial Update

Balance Sheet

Unit: NT$M

Key accounts	4Q18		Amount % 3Q18	4Q17
	Amount %			Amount %
Cash and cash equivalents Accounts receivable Inventory Other current assets Non-current assets	3,250 4 35,294 38 46,875 51 2,509 2 4,820 5		2,818 3 46,421 47 42,894 43 2,706 2 4,890 5	2,288 3 32,326 43 33,114 44 2,625 4 4,813 6
Total Assets	92,748 100		99,729 100	75,166 100
Short-term loans Accounts payable Other current liabilities Long-term loans	28,812 31 38,103 41 3,360 4 123 -		25,748 26 47,066 47 5,077 5 185 -	25,862 34 24,463 33 2,125 3 982 1
Other liabilities	538 -		571 1	1,653 2
Total Liabilities Total Equity	70,936 76 21,812 24		78,647 79 21,082 21	55,085 73 20,081 27
Indices	4Q18		3Q18	4Q17
Current ratio Debt/Assets ratio Debt/Equity ratio Gearing ratio	125% 76% 325% 1.18		122% 79% 373% 1.10	134% 73% 274% 1.22

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2. Financial Update

NR by Geography (Ship-to Destination)

	79.8% 80.7% 81.7% 86.0% 82.7% 82.1% 89.3% 90.1% 9.2% 8.5% 7.1% 6.0% 8.1% 7.9% 5.5% 4.2% 8.1% 8.1% 8.5% 5.7% 5.9% 6.1% 3.0% 3.5% 2.3% 2.2% 2.0% 1.8% 2.6% 3.4% 1.9% 1.9% 0.6% 0.5% 0.6% 0.5% 0.7% 0.5% 0.3% 0.3% 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 China Taiwan Korea ASEAN Others 0 10 20 30 40 50 60 70 80 90 Revenue (NT$B) Revenue (NT$B) 0 10 20 30 40 50 60 70 80 90	China Taiwan Korea ASEAN 3Q18 (Left) vs. 4Q18 (Right) QoQ +1% QoQ +18% QoQ -23% QoQ +2%
0% 20% 40% 60% 80% 100%
		China Taiwan Korea ASEAN 4Q17 (Left) vs. 4Q18 (Right) YoY +51% YoY -12% YoY 0% YoY +50%

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2. Financial Update

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NR by Geography (Ship-to Destination)
0.2% 0.5% 0.5% 0.5% 0.4%
100% 2.3% 2.0% 1.8% 2.0% 2.3%
5.6% 5.1% 7.8% 7.4% 4.3%
7.4% 7.7% 7.7% 7.5% 6.0%
80%
Others
60% ASEAN
40% 84.5% 84.7% 82.2% 82.5% 87.0% Korea
Taiwan
20%
China
0%
2014 2015 2016 2017 2018
250 YoY +52%
200
2017
(Left)
150 vs.
2018
(Right)
100
50
YoY +16% YoY -17%
YoY +64%
0
China Taiwan Korea ASEAN
Revenue (NT$B)
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2. Financial Update

NR by Customer Base

0% 20% 40% 60% 80% 100%	55.6% 52.7% 50.7% 57.8% 56.2% 53.5% 68.2% 72.0% 33.1% 36.5% 38.5% 34.1% 34.7% 36.6% 26.5% 22.4% 9.3% 8.6% 8.8% 6.4% 6.3% 6.6% 3.4% 3.9% 2.0% 2.2% 2.0% 1.7% 2.8% 3.3% 1.9% 1.7% 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 Taiwan Customer China Customer Korea Customer ASEAN Customer

Revenue (NT$B) 0 10 20 30 40 50 60 70 0 10 20 30 40 50 60 70 Revenue (NT$B)	Taiwan Customer China Customer Korea Customer ASEAN Customer QoQ +7% QoQ -14% QoQ +16% QoQ -9% 3Q18 (Left) vs. 4Q18 (Right)
	Taiwan Customer China Customer Korea Customer ASEAN Customer 4Q17 (Left) vs. 4Q18 (Right) YoY +79% YoY -6% YoY -13% YoY +43%

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2. Financial Update

NR by Customer Base

0% 20% 40% 60% 80% 100%	47.5% 45.8% 51.2% 54.4% 64.4% 43.6% 45.9% 38.5% 35.6% 28.7% 6.6% 6.1% 8.3% 8.1% 4.7% 2.2% 2.2% 1.9% 1.9% 2.3% 2014 2015 2016 2017 2018 ASEAN Customer Korea Customer China Customer Taiwan Customer
Revenue (NT$B) 0 20 40 60 80 100 120 140 160 180 200	Taiwan Customer China Customer Korea Customer ASEAN Customer 2017 (Left) vs. 2018 (Right) YoY +68% YoY -16% YoY +16% YoY +71%

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2. Financial Update

NR by Application

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50 QoQ 14%
100% 3.7% 4.0% 4.2% 3.4% 3.9% 4.3% 2.5% 2.4% 3Q18
7.2% 7.8% 6.6% 6.4% 7.3% 7.5% 5.3% 5.4% 40 (Left) vs.
9.2% 7.3% 30 4Q18
11.4%
80% 13.4% 14.9% 13.8% 13.5% 14.0% QoQ -8% (Right )
13.7% 20 QoQ -13%
15.9%
QoQ -20%
17.2% 10 QoQ +3%
17.7% 16.4% 18.7%
19.5% 20.1%
18.9% 0
60%
20.8%
19.7%
18.9% 21.3%
21.5%
22.6% 22.9%
40%
4Q17
52.3% 50 YoY +79% (Left)
46.3% vs.
20% 39.1% 37.7% 41.9% 35.1% 40 4Q18
31.2% 31.2% (Right )
30
20 YoY +37% YoY +14%
0%
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 10 YoY -8% YoY +21%
0
Communication Computing
Consumer Industry & Instrument (I&I)
Automotive Others
Revenue (NT$B)
Revenue (NT$B)
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2. Financial Update

NR by Application

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100% 3.1% 3.8% 3.2% 3.8% 3.1%
7.3% 7.4% 6.9% 6.1%
Others
10.3%
80% 13.7% 15.3% 13.4% 13.2%
16.5% Automotive
21.3% 18.3% 17.6%
21.3%
60%
Industry & Instrument
20.7%
20.4% 20.6%
27.2% Consumer
40% 25.3%
Computing
20% 37.4% 37.9% 43.2%
28.4% 27.0% Communication
0%
2014 2015 2016 2017 2018
140
YoY +64% 2017
120 (Left)
vs.
100
2018
80 (Right )
YoY +45%
60 YoY +36%
40 YoY +13%
YoY +28%
20
0
Communication Computing Consumer Industry & Instrument Automotive
Revenue (NT$B)
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2. Financial Update

ROE vs. EPS

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2.00 18.8% EPS ROE% 19.2% 20%
15.3%
13.4%
1.50 15%
12.0% 11.6% 12.4% 11.0%
1.00 10%
0.50 5%
1.06 1.15 1.61 1.44 1.05 1.12 1.79 1.06
0.00 0%
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18
6 EPS ROE% 20%
13.6%
13.3%
5
14.1% 12.9% 15%
4 10.1%
3 10%
2
5%
1
5.18 4.49 3.61 5.26 5.02
0 0%
2014 2015 2016 2017 2018
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2. Financial Update

ROWC vs. NWC/Sales

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0.30 25%
NWC/Sales
0.25
20%
ROWC
0.20 16.1%
15%
0.15 11.6% 11.7% 12.0% 10.6% 11.7%
9.3%
10%
9.8%
0.10
5%
0.05
0.18 0.19 0.18 0.17 0.23 0.24 0.12 0.13
0.00 0%
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18
0.30 25%
0.25 NWC/Sales
20%
ROWC
0.20 14.8%
15%
11.9%
0.15
9.6%
8.8% 7.5% 10%
0.10
5%
0.05
0.15 0.25 0.23 0.22 0.16
0.00 0%
2014 2015 2016 2017 2018
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2. Financial Update

Operating Cash Cycle

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AR INV AP Operating cash cycle
90
83
80
73
68
61 60
60
49 45
30
0
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18
90 AR INV AP Operating cash cycle
77
72 72
58
60
52
30
0
2014 2015 2016 2017 2018
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3. Business Outlook

We currently expect 1Q19 :

• Revenue : between NT$65 billion ~ NT$70 billion, at a forecast exchange rate of 30.8 NT Dollars to 1 US Dollar

• Revenue guidance between 18% ~ 24% QoQ decrease and

• 31% ~ 41% YoY increase

• Gross profit margin : between 3.3% ~ 3.5%

• Operating profit margin : between 1.4% ~ 1.6%

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4. Recap of Recent Major Events

 WT was ranked as Top 10 Global Branded Distributor Awards in 2018 by ESM 、 EET and EDN (Aspencore).

• WT published first Corporate Social Responsibility (CSR) Report for the year of 2017. (http://www.wtmec.com/WT/?page_id=12183)

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Thank You !

WT Microelectronics Co., Ltd. Website : www.wtmec.com

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