WT — Investor Presentation 2021

Jan 13, 2021

2020 Third Quarter Investor Conference

Presented by Cheryl Yang November 6, 2020

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. 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

• 2019 revenues of NT$335bn, up 23% YoY

• 45 offices in Asia (28 offices in China and 17 offices in Korea, Taiwan, and South Asia) with over 9,000 customers

• Over 2,300 headcounts (over 700 sales, 250 PMs, and 450 FAEs)

• Completion of warehouse semi automation (total 5 warehouses in Taiwan, HK, Shenzhen China, Korea, and Singapore)

• Completion of B2B service platform for major vendors and customers

• “Digital Transformation” on going (More details in 2019 WT ESG Report)

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1. Overview

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Korea Offices (4)
China Offices (28)
Seoul
Harbin
Shenyang Offices Across Asia Gyeonggi-do
Dalian Daegu
Beijing Gwangju
Qingdao
Taiwan Offices (4)
Zhengzhou
Jinan Taipei, Headquarters
Xian
Hsinchu
Ningbo
Shanghai Taichung
Wuxi
Suzhou Tainan
Nanjing South Asia Offices (9)
Hangzhou
Wenzhou New Delhi, N. India
Hefei
Chengdu Mumbai, N. India
Chongqing
Changsha Pune, N. India
Wuhan
Fuzhou Hanoi , Vietnam
Xiamen
Ho Chi Min, Vietnam
Dongguan
Foshan
Bangalore, S. India
Guangzhou
Zhuhai
Bangkok, Thailand
Hong Kong
Shenzhen
Penang, Malaysia
Singapore
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1. Overview

NR (Net Revenue)

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CAGR(2016~2019)=31%
NT$B
400
350 335
300
273
250
189
200
144
150
108 [114 ]
88
100 80
71
64
47
50 30 34 39 41
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 2019
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2. Financial Update

Statement of Comprehensive Income

Unit: NT$M

K t	3Q20	2Q20	QQ	3Q19	YY
ey accouns	Amount %	Amount %	o	Amount %	o
Net Operating revenues Gross profit Operating expenses Operating income Financing costs Others Earning before tax Income tax expense Profit after tax	91,862 100.00% 2,761 3.01% (1,354) -1.47% 1,407 1.53% (180) -0.20% 220 0.25% 1,447 1.58% (295) -0.32% 1,152 1.25%	74,724 100.00% 2,503 3.35% (1,317) -1.76% 1,186 1.59% (249) -0.33% 48 0.06% 985 1.32% (196) -0.26% 789 1.06%	23% 10% 3% 19% -28% 358% 47% 51% 46%	96,191 100.00% 2,977 3.09% (1,428) -1.48% 1,549 1.61% (485) -0.50% (35) -0.04% 1,029 1.07% (212) -0.22% 817 0.85%	-5% -7% -5% -9% -63% n.m. 41% 39% 41%
EPS (in dollars)	1.46	1.07		1.38
Weighted average shares (M shares)	787	737		590

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2. Financial Update

Balance Sheet

Unit: NT$M

Key accounts	3Q20		Amount % 2Q20	3Q19
	Amount %			Amount %
Cash and cash equivalents Accounts receivable Inventory Other current assets Non-current assets	4,675 4 49,840 42 41,881 36 2,388 2 18,580 16		5,050 4 43,322 38 46,753 41 2,147 1 17,938 16	6,421 6 45,438 44 42,768 42 2,959 3 5,199 5
Total Assets	117,364 100		115,210 100	102,785 100
Short-term loans Accounts payable Other current liabilities Long-term loans	27,891 24 45,633 39 2,951 2 800 1		30,037 26 42,989 37 4,402 4 - -	31,158 30 42,374 41 3,523 4 - -
Other liabilities	1,445 2		1,547 1	2,226 2
Total Liabilities Total Equity	78,720 67 38,644 33		78,975 69 36,235 31	79,281 77 23,504 23
Indices	3Q20		2Q20	3Q19
Current ratio Debt/Assets ratio Debt/Equity ratio Gearing ratio	129% 67% 204% 0.62		126% 69% 218% 0.69	127% 77% 337% 1.05

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2. Financial Update

NR by Geography (Ship-to Destination)

	0.3%	0.3%	0.3%	0.4%	0.4%	0.4%	0.4%	0.4%	0.4%		0.3%	0.3%		0.6%	0.6%		0.7%	0.7%	1.0%	1.3%		90		QoQ +26%	QoQ +26%
0% 20% 40% 60% 80% 100%	90.1% 4.2% 3.5% 1.9% 4Q18			87.2% 5.4% 4.5% 2.5% 1Q19			87.9% 5.8% 3.6% 2.3% 2Q19			88.7% 4.8% 3.2% 3.0% 3Q19			87.6% 5.6% 2.9% 3.3% 4Q19			80.7% 8.4% 3.6% 6.6% 1Q20			81.9% 8.0% 2.8% 6.3% 2Q20	84.1% 6.4% 2.0% 6.2% 3Q20	Revenue (NT$B) Revenue (NT$B)	0 10 20 30 40 50 60 70 80 30 40 50 60 70 80 90		China YoY -9%		Taiwan QoQ -2%			Korea QoQ -12%		ASEAN 2Q20 (Left) vs. 3Q20 (Right) QoQ +21% 3Q19 (Left) vs. 3Q20 (Right)
			China				Taiwan				Korea				ASEAN				Others			10 20				YoY	+27%		YoY -40%		YoY +97%
																						0
																								China		Taiwan			Korea		ASEAN

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2. Financial Update

NR by Customer Base

0.0% 20.0% 40.0% 60.0% 80.0% 100.0%	Revenue (NT$B) 72.0% 62.8% 61.5% 67.5% 67.7% 63.4% 61.0% 68.0% 22.4% 30.4% 32.3% 26.7% 26.7% 27.8% 31.7% 26.6% 3.9% 4.7% 4.2% 3.8% 3.3% 4.1% 3.1% 2.4% 1.7% 2.1% 2.0% 2.0% 2.3% 4.7% 4.2% 3.0% 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 Taiwan Customer China Customer Korea Customer ASEAN Customer 0 10 20 30 40 50 60 70 0 10 20 30 40 50 60 70 Revenue (NT$B)	Taiwan Customer China Customer Korea Customer ASEAN Customer QoQ +37% QoQ +3% QoQ -5% QoQ -12% 2Q20 (Left) vs. 3Q20 (Right)
		Taiwan Customer China Customer Korea Customer ASEAN Customer 3Q19 (Left) vs. 3Q20 (Right) YoY -4% YoY -5% YoY -40% YoY +43%

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2. Financial Update

NR by Application

52.3% 44.5% 18.9% 24.1% 13.7% 15.2% 7.3% 8.4% 5.4% 5.3% 2.4% 2.5% 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 4Q18 1Q19	52.3% 44.5% 18.9% 24.1% 13.7% 15.2% 7.3% 8.4% 5.4% 5.3% 2.4% 2.5% 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 4Q18 1Q19	52.3% 44.5% 18.9% 24.1% 13.7% 15.2% 7.3% 8.4% 5.4% 5.3% 2.4% 2.5% 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 4Q18 1Q19	41.3% 23.7% 15.5% 10.5% 5.6% 3.4% 2Q19	50.8% 53.7% 18.9% 19.2% 14.1% 12.1% 8.2% 7.4% 4.9% 5.0% 3.1% 2.6% 3Q19 4Q19	50.8% 53.7% 18.9% 19.2% 14.1% 12.1% 8.2% 7.4% 4.9% 5.0% 3.1% 2.6% 3Q19 4Q19	45.3% 23.7% 14.1% 8.5% 5.3% 3.1% 1Q20	45.3% 23.7% 14.1% 8.5% 5.3% 3.1% 1Q20	38.8% 30.8% 13.6% 7.9% 5.7% 3.2% 2Q20	48.5% 23.5% 13.0% 6.7% 5.3% 3.0% 3Q20
	Communication			Computing
	Consumer			Industry &			Instrument (I&I)
	Automotive			Others

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50 QoQ +54% 2Q20
(Left)
40
vs.
30 3Q20
QoQ -6%
(Right )
20
QoQ +18%
10 QoQ +4% QoQ +14%
0
3Q19
60 (Left)
YoY -9% vs.
50
3Q20
40 (Right )
30 YoY +19%
20 YoY -12%
YoY -22% YoY +3%
10
0
Revenue (NT$B)
Revenue (NT$B)
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2. Financial Update

ROE vs. EPS

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EPS
2.00 20%
ROE%
1.50 14.2% 15%
12.0%
11.0% 12.3%
10.8% 10.7% 10.8%
1.00 10%
6.8%
0.50 5%
1.06 0.67 1.06 1.38 1.21 1.04 1.07 1.46
0.00 0%
4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20
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2. Financial Update

ROWC vs. NWC/Sales

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0.30 25%
NWC/Sales
ROWC
0.25
20%
0.20
15%
13.5%
12.1% 12.2%
0.15 11.4%
10.6%
10%
10.1%
0.10 8.2%
8.1%
5%
0.05
0.13 0.18 0.17 0.12 0.12 0.18 0.16 0.13
0.00 0%
4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20
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2. Financial Update

Operating Cash Cycle

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AR INV AP Operating cash cycle
90
65
64
62
60
60
46 46 46
42
30
0
4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20
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3. Business Outlook

We currently expect 4Q20 :

• Revenue : between NT$97 billion ~ NT$103 billion, at a forecast exchange rate of 28.7 NT Dollars to 1 US Dollar

• Revenue guidance between 6% ~ 12% QoQ increase and 0% ~

• 6% YoY growth

• Gross profit margin : between 2.75% ~ 2.95%

• Operating profit margin : between 1.35% ~ 1.55%

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Thank You !

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

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