ZERO ONE — Interim / Quarterly Report 2021

Dec 24, 2021

General Manager / Nancy Huang

Zero One Technology Co., Ltd. ©2014.8.5

Agenda

• Company Profile and Overview

• Analysis of Taiwan ICT Distributers Status and Zerone’s Leading Advantages

• Operating Strategy and Project Structure

• 2021Q1-Q3 Operations Review

• Financial Condition & Analysis

• Value Proposition & Future Operation Prospects

• Q & A

2

Disclaimer

• ➢

This document is provided by ZERO ONE TECHNOLOGY CO., LTD. Except for the numbers and information included in the Company's financial statements, the information contained in this document has not been audited or reviewed by any accountants or independent experts. The Company does not give any representations or warranties (express or implied) as to the accuracy, completeness, or correctness of such information or opinions. This document is provided as of the date herein and will not be updated to reflect any changes hereafter. The Company, its affiliates and their representatives do not take any responsibility nor accept any liability for any damage caused by their negligence or any other reasons, nor do they accept responsibility or liability for any loss or damages arising from the use of this document or the information contained herein or anything related to this document.

➢ This document may contain forward-looking and strategic statements, including but not limited to all statements which address activities, events or developments that the Company expects or anticipates to hold in the future based on the projections of the Company going forward, as well as various factors and uncertainness beyond the Company's control. Therefore, the actual results may differ materially from those contained in these forward-looking statements. Please do refer to the information on MOPS website as the main basis if any adjustment has been made.

➢

This presentation is not and cannot be construed as an offer to purchase or sell securities or any other financial products nor considered as a solicitation of an offer.

3

Company Profile & Overview

4

OUTLINE

Consecutive annual growth of revenue for 12 years

• Founded in ：1980

Unit: NT$ Million

• TPEX：2000

• TWSE：2002

• Capitals：NT$1.25 billion

• Employees：300 employees

• Partners：More than 1,000

12000

10000 8000 6000 4000 2000 0

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• 2020 operating revenues： NT$ 9.8 billion

• (2020 Consolidated，YoY +10.3%)

• 2021Q1~Q3 operating revenues：NT$9.84 billion

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5

Milestones

2021

2017

2015 Enter AI market & build deep learning platform for enterprises

With the aim to complete partnership ecological sphere & expand market scale, Zerone Win Investment Co. Ltd. was set up and in the same year：

2014

2013

Enter into Big Data market management, cultivate further the IT application solutions for enterprises

Invest in cloud consulting service team～subsidiary company was set up to cultivate cloud market.

Invest in cloud content delivery, 2010 proactively strategize information security market and service structure

Set up in response to information security & IT automation needs.

Enter Enterprise Storage Market to secure private cloud transformation business opportunities

Strive with the goal of being an ESG enterprise & move forwards towards corporate collectivization！

Set up HsinChu Branch to cultivate regional channels & project services, and continue to develop ecological platform for partners！

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6

Analysis of Taiwan ICT Distributers Status and Zerone’s Leading Advantages

7

– Global Economic & Industry Trends + COVID Impacts demand in Taiwan ICT continues to grow steadily

2020 ~ Covid-19 pushes all industries to speed up digital transformation continuously ~

Upgrade of Industry 4.0 to 5G / IoT helps promote the need to replace relevant obsolete basic infrastructure

2022 ~ with the maturing of new technologies and business models, businesses continue to invest & increase in ICT capital expenditures ~

Life after COVID changes drastically - >demand for subscription economies and remote market increase in speed through Cloud

Production efficiency increases in all industries->with AI / Big Data being used in core business strategies and executions

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8

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Zerone continues to create
1995~2005
irreplaceable values in the
ecological chain of Era of the Internet and IT
distributors! Distribute renowned
companies such as
Cisco & MicroSoft
2006 ~ 2010
Solid Channel
Era of IT security &
Foundation!
virtualization application
Rooted in enterprise
project market, cultivate
-
technology based SI !
2011 ~ 2020 : 2021 ~ the Big Future :
Era of fusing cloud & 地 Era of Intelligent IT
Provide branded Distribute recognized
brands & provide
integrated solutions
services to local
experience, shortening
partners to increase
deployment time ! added values!
專業服務邁向卓越 | We Commit To Excellence
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9

Brand performances ranked No. 1 in the Taiwan market

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10

Exclusive Distribution Brands in Taiwan

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11

Operating Strategy & Project Structure

12

The Zerone Offers Values of Platforms & the Spirit of Service

Common Good Achieved Create mutually beneficial & positive spiral Businesses Enhanced Actualize product functions & integrate into practical applications Partners Aligned Build modules and transform customized project needs to duplicable solutions

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Manufacturers Sought Bring in new technologies to Taiwan & facilitated industry transformation

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A model of ecosystem of partners platform of ZERONE

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Solution Delivery Vendor Linking
Project Solution projects Availability、 Technical
management & help partners performance innovation &
verifying structural increase sales
reliability values & management integration
Value- Needs Projects Trending
definition confirmation commercialization connect
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Service Landing

Process optimization

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人工智慧
網路 大數據 Internet 資訊安全 Execution
Sales & System
promotion management
AI備份備援& Information 雲端
Big data Value-Added security
系統管理 儲存
Integration
video Intelligent analytics 視訊監控 Tracking
Storage視訊監控 Cloud
Back up
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Customers of
SMLE
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7 * 24
technical support
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CRM
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The scope of
industries
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After-sales training
for customers
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Project exhibition
center
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Demographics
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Products
maintenance center
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Seamless Deployment of the Latest Technology from manufacturers

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-Integration of enhanced product -- functions with industry applications

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15

Channel Management which Aims towards Multi Channel Precision Marketing

(Updated: 2021Q1~Q3)

+30K clients in 189 marketing +6,000 database client +194 fans @FB events sessions of 209 live+1300 streaming training/ce subscriptions rtification @Youtube classes

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16

2021Q1 Q3 Operations Review

17

2021Q1 Q3 Operations Review

Accumulated Sales Revenue of 2021Q1 Q3

Accumulated Sales Revenue of 2020Q1 Q3

	9.84	billion	Other	Other	0%	7.598	billion
Big Data &						Big Data &
Application 4%						Application 5%	Other 0%
					IT Infrastructure
Cloud Platform &					42%
Application 17%						Cloud Platform & Application 19%	IT Infrastructure 29%
						Network & Information
Network & Information						Security 47%
Security 37%
					Sales revenue		Sales revenue
					(Unit: thousand)		(Unit: thousand)
	Product Category				2021/Q1-Q3	Product Category	2020/Q1-Q3
	IT Infrastructure				$4,125,362	IT Infrastructure	$ 2,216,140
	Network & Information Security				$3,651,634	Network & Information Security	$ 3,578,137
	Cloud Platform & Application				$1,645,925	Cloud Platform & Application	$ 1,434,828
	BigData & Application				$413,903	BigData & Application	$ 366,445
	Other				$3,225	Other	$ 2,991
	Consolidated operatingrevenue				$ 9,840,049	Consolidated operatingrevenue	$ 7,598,541

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Financial Conditions & Analysis Senior Director of Financial Management Division / Michelle Chin

19

Unit : NT$ 100 M

Revenue of Previous Years

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120
?
97 97
88
90
66
58
56
60 51
48
42
39 39 30% growth 47% growth
in 3 years in 2 years
30
0
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Bar Chart of Condensed Income Statement (Year-over-Year)

OPERATING REVENUES GROSS PROFITS OPERATING EXPENSES NET PROFITS

Unit：NT$ Million

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411
18% 456
925
348 16%
390
798
29%
9,840
7,599
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2020/Q1~Q3

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2021/Q1~Q3
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Bar Chart of Condensed Income Statement

OPERATING REVENUES GROSS PROFITS OPERATING EXPENSES NET PROFITS

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Unit：NT$ Million
Profit ratio 4.48%
Profit ratio 3.91%
26% 440 411
349 541 456
496 1,046 925
896 17%
252
195 401
10%
353 682
588
9,834 9,840
8,915
6,647
5,967
2017 2018 2019 2020 2021/Q1-Q3
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22

Condensed Consolidated Balance Sheet

	Unit: NT$ Million	Unit: NT$ Million
Items	2020/12/31	2021/9/30
	Amount %	Amount %
Cash and financial assets- current	1,237 23%	1,194 17%
Notes, trade receivable	2,140 39%	3,240 47%
Inventories	1,242 23%	1,630 24%
Long-term investment	454 8%	450 7%
Total assets	5,471 100%	6,911 100%
Short-term borrowings	- 0%	450 7%
Trade payables	2,245 41%	3,030 44%
Total liabilities	2,802 51%	4,161 60%
Total equity attributable to owners of the Company	2,657 49%	2,739 40%
Non-controlling interests	12 0%	11 0%
Total equity	2,669 49%	2,750 40%

23

Financial Index Analysis

Horizontal Item 2017 2018 2019 2020 2021Q3 Average 42.16 49.83 53.55 51.21 60.21 52.35 Debts ratio (%) 211.43 174.47 180.41 167.54 147.11 178.78 Current Ratio(%) 178.19 130.09 126.59 121.91 107.43 99.31 Quick Ratio(%) Average 101.10 97.33 80.39 77.49 74.79 57.32 Collection Days Average 31.73 43.81 51.48 53.21 44.08 97.86 Inventory Turnover Days Average 81.29 88.81 83.91 88.81 80.99 85.09 Payables Days

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Unit: NT$ Dollar

EPS & Dividend Payout Ratio of Previous Years

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4.00
3.55
3.00
2.85
3.00
2.06
2.00
1.85
2.00
1.61
1.50
1.30
1.20
1.00
81% 85%
73% 70%
65%
0.00
2016 2017 2018 2019 2020
EPS Cash/Stock Dividend Dividend Payout Ratio
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25

Unit: NT$ Dollar

ROE of Previous Years

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4.00 25%
3.55
20%
2.85
3.00
17.3% 15%
2.06
1.85 15.1%
2.00
1.61
11.5% 11.7% 10%
9.5%
1.00
5%
0.00 0%
2016 2017 2018 2019 2020
每股盈餘 EPS 股東權益報酬率 ROE
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26

Value Proposition & Future Operation Prospects

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FY20~FY21 Acknowledgements from Manufacturers

• 2021 wins Dell Technologies GOLD PARTNER

• 2021 wins PaloAlto Excellent Support of Year

• 2021 wins Progress The Best Distributor

• 2021 wins INFINITIES The Best Distributor

• 2021 wins Microsoft The Best Cloud Distributor of the Year

• 2020 wins Microsoft The Best Cloud Distributor of the Year

• 2020 wins vmware Distributor Sales Champion of the Year

• • 2020 wins F5 APAC DS2 Program FY20 Champion

• 2020 wins FireEye Most Valuable Distributor of the Year

• • 2020 wins Vivotek the Best Distributor in Asia Pacific Region

• • 2020 wins NetApp the Best distributor

Best Distributor of the Year

• 2020 wins Nutanix Best Distributor of the Year

28

Zerone’s Values & Claims

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Add Value to
Service Distribution
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Brand Distribution
Layout
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Client Expand Market Cultivation Share

Technology Optimization

Adhere to Market Trends

Transform Processes into Platforms Transform Services into Tangible Products

Secure Channel Partners Duplicate Successful Business Models

29

Zerone’s Platform Layout & Future Prospects

Provide platforms which allow professional IT(SI) & industry experts (ISV) to interact & engage with manufactures’ innovative technologies and actualize new business opportunities. ( Zerone Solution & Service Platform )

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價值創造者
Value Created
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Partner value

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附加價值者
Value Added
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Continue to integrate & improve manufactures’ solutions based on successful cases so as to facilitate distribution partners’ continuous efforts in cultivating high-growth clients

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價值提供者
Value Offered
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Provide comprehensive products & services which satisfy basic market demands.

Volume Business : Focus on fulfillment + resale

Investment in service and value transformation

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Future Operation Prospects

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Thank you for attending the online investor conference
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Zero One Technology Co., Ltd. ©2014.8.5