Investment Conference - TXC · PDF fileInvestment Conference May, 2013 Think of Frequency, Think of TXC. Content ... • NFC • FHD Think of

1

Think of FrequencyThink of

Investment Conference May, 2013

www.txccorp.com

Think of Frequency, Think of TXC

Content

FINANCIAL RESULTS

SALES & MARKETING

PRODUCT DEVELOPMENT

BUSINESS HIGHLIGHT

Q&A

2Think of Frequency, Think of TXC


4

Revenue Trend

Unit: $NT in Million

10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1 12.Q2 12.Q3 12.Q4 13.Q1Revenue (QoQ) ‐7.8% 10.7% 7.3% 7.1% ‐13.6% 6.6% 0.7% 4.5% ‐8.1% 7.7% 15.3% 0.2% ‐21.9%Revenue (YoY) 51.6% 28.2% 13.2% 17.3% 9.9% 5.9% ‐0.6% ‐3.1% 3.1% 4.2% 19.2% 14.4% ‐2.8%

2,113 2,338

2,510 2,689

2,322 2,476 2,494 2,605

2,394 2,579

2,974 2,981

2,327

0

500

1,000

1,500

2,000

2,500

3,000

3,500

10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1 12.Q2 12.Q3 12.Q4 13.Q1


55

Unit: $NT in Million

Gross Profit Trend

10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1 12.Q2 12.Q3 12.Q4 13.Q1Gross Profit (QoQ) ‐16.0% 18.4% 10.7% ‐2.5% ‐15.2% 5.7% 3.4% ‐7.0% ‐10.9% 19.0% 9.8% 0.1% ‐23.6%Gross Profit (YoY) 28.3% 16.3% 6.7% ‐8.7% 8.4% ‐3.2% ‐9.5% ‐13.7% ‐9.4% 2.0% 8.3% 16.6% 0.0%

25.2%

26.9% 27.7%25.2%

24.6%

24.7%

24.9% 22.5%

21.8%

24.1%

22.9%

22.9%

22.4%

10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1 12.Q2 12.Q3 12.Q4 13.Q1

532 629

696 679

576 609 630 586

522 621

682 683

522

0

100

200

300

400

500

600

700

800

10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1 12.Q2 12.Q3 12.Q4 13.Q1


66

Net Profit TrendUnit: $NT in Million

213

331 361

285 237 248

305 260

199

261

363 326

209

0

50

100

150

200

250

300

350

400

450

10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1 12.Q2 12.Q3 12.Q4 13.Q1

10.1%

14.2%

14.4%

10.6%

10.1%

10.0% 12.2% 10.0%

8.3%

10.1%

12.2%

10.9%9.0%

10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1 12.Q2 12.Q3 12.Q4 13.Q1

10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1 12.Q2 12.Q3 12.Q4 13.Q1Net Profit (QoQ) ‐24.7% 55.4% 9.0% ‐21.0% ‐16.8% 4.6% 23.0% ‐14.8% ‐23.5% 31.2% 39.1% ‐10.2% ‐35.9%Net Profit (YoY) 103.0% 52.1% 22.4% ‐14.0% 11.3% ‐25.1% ‐15.4% ‐8.8% ‐16.0% 5.2% 19.0% 25.4% 5.0%


77

Income Statement Highlight

Unit：$NTin thousand

2011(ROC GAAP)

2012(ROC GAAP)

GrowthRate

Q1 2012(T-IFRS)

Q1 2013(T-IFRS)

GrowthRate

Net Revenue 9,897,341 10,928,495 10.4% 2,394,341 2,326,980 -2.8%Gross Profit 2,400,646 2,508,295 4.5% 522,080 521,710 -0.1%Operating Profit 1,151,521 1,257,655 9.2% 229,176 219,869 -4.1%Income before tax 1,213,210 1,302,619 7.4% 225,854 238,872 5.8%Net Income 1,050,216 1,148,886 9.4% 198,131 209,434 5.7%

Gross Margin 24.3% 23.0% - 21.8% 22.4% -Operating Margin 11.6% 11.5% - 9.6% 9.4% -Net Margin 10.6% 10.5% - 8.3% 9.0% -


88

Balance Sheet Highlight

Unit：$NT in thousand 2012(ROC GAAP)

Q1 2012(T-IFRS)

Q1 2013(T-IFRS)

Current Assets 6,737,268 5,780,421 7,280,011 Fixed assets 5,734,497 5,502,415 5,553,851 Total assets 12,996,202 11,865,853 13,575,502 Current liabilities 3,445,764 3,316,303 3,115,300 Long-term liabilit ies 1,525,637 1,300,744 2,248,184 Total liabilities 5,115,706 4,617,047 5,363,484 Shareholders' equity 7,880,496 7,248,806 8,212,018

Debt ratio 39.4% 38.9% 39.5% Current Ratio 195.5% 174.3% 233.7% Quick Ratio 147.7% 129.1% 167.7% Net Value Per Share 26.07 23.98 26.51


Capital Expenditures of 2013

9

(Unit: $NT in Million)

AMOUNTS:250SMD X’TAL in-Line (Q1)*6 (Q2)*6(Q3)*6 (Q4)*2

CKG FACTORY

AMOUNTS:220MINIAUATE X’TAL(Q2)*6

NGB FACTORY

AMOUNTS:400TCXO/AOM/X’TAL*5 SAPPHIRE EQUIPMENT (PSS)RD EQUIPMENTS

PING-CHENG FACTORY

AMOUNTS:870

CKG

PCFNGB


10

■ Compensation payable to directors and supervisors■ 2%(2012)

■ Employee Bonus■ 12%(2012)

2005 2006 2007 2008 2009 2010 2011 2012

Earning Per Share 2.73 4.13 4.88 3.56 2.75 4.06 3.48 3.79

Cash Dividend Per Share 0.99 1.94 1.98 2.00 2.00 2.50 2.2 2.2

Stock Dividend Per Share 0.59 0.97 0.99 0.50 0.20 0.20 0 0

Yield(%) 1.95% 3.20% 3.63% 6.25% 3.84% 4.47% 5.05% 4.91%

Dividend Policy

2.73

4.13

4.88

3.56

2.75

4.06

3.483.79

0.99

1.94 1.98 2 22.5

2.2 2.2

0.590.97 0.99

0.50.2 0.2 0 0

0

1

2

3

4

5

6

2005 2006 2007 2008 2009 2010 2011 2012


(Unit: $NT)


12

Despite the market impact, Timing market is projected to have stable growth; conservatively 18B units in 2013 will hit USD3.5B revenues

02,0004,0006,0008,00010,00012,00014,00016,00018,00020,000

2012 2013 2014 2015

MHz Xtal KHz Xtal TCXO XO VCXO OCXO

0

1,000

2,000

3,000

4,000

2012 2013 2014 2015

Think of Frequency, Think of TXCSource: CS&A 2013

KHz X’tal37%

MHz X’tal52%

XO5%

TCXO6%

VCXO0.5%

OCXO0.02%

KHz X’tal20%

MHz X’tal35%

XO13%

TCXO22%

VCXO6%

OCXO5%

Worldwide T.A.M. Splits

Think of Frequency, Think of TXCSource: CS&A 2013

13

14

In the top 5 timing players, TXC is the only Chinese vendor who can provide total solutions to compete with Japanese vendors

2011Rank

2012Rank Company Name

2011Revenue

USD: Million

2012Revenue

USD: Million

2011-2012Change

2011MarketShare

2012MarketShare

1 1 Epson Toyocom 592 610 3.0% 16.7% 17.5%

2 2 NDK 557 540 -3.0% 15.7% 15.5%

4 3 TXC 327 377 15.3% 9.2% 10.8%3 4 KDS 389 309 -20.5% 11.0% 8.8%

5 5 KED 265 292 10.0% 7.5% 8.4%

6 6 Vectron 196 166 -15.0% 5.5% 4.8%

7 7 Rakon 111 106 -4.8% 3.1% 3.0%

9 8 Siward 90 97 8.4% 2.5% 2.8%

8 9 Hosonic 101 92 -9.5% 2.9% 2.6%

10 10 Taitien 79 59 -25.4% 2.2% 1.7%

Other Companies 832 841

Total Revenues 3,539 3,489

Source: CS&A 2013

• 10.8% market share in 2012, 15.3% growth


Market share leadershipTiming Market Share / Position

15

MHz Crystal/kHz Crystal

XO/MO

VCXO

TCXO

14.5%13.2%

3.4%

9.0%

2.4%

8.0%

7.3%

3.5%


Source: CS&A 2013

XO9%

KHz X’tal5.37%

MHz X’tal57%

Others3%

TCXO24%

VCXO1%

XO10%

KHz X’tal6%

MHz X’tal67%

Others4%

TCXO13%

VCXO1%

TXC’s Revenue Splits by Product Category

Think of Frequency, Think of TXC 16

TXC grows in Mobile market and develops in Automotive and Infrastructure

17

20%

37%14%

7%

7%

2%1%3%

9%

15%

40%

13%

8%

7%

3%2%

3%

9%

PC

Mobile

Networking

Infrastructure

DigitalHome

Automotive

SapphireEMS/OEM

Others


18

More and more consumer devices become SMARTand SMARTER 5~6 inch Smartphone (Phablet) “Bendy” Smartphone

NB/Tablet (Convertible)

Smart TV – Ultra HD, OLED (Bendy) Smart Audio

Table PC Google Glass

CrystalXO

TCXO/TSX

• 3G/4G/B4G• BT• WiFi/WiGig/WiDi• GPS• NFC• FHD


19

Home appliances also adopted wireless technology to become SMART Home

Smart Home SecurityEnergy monitoring

Tablet Concept Refrigerator

CrystalXO

• BT/ZigBee• WiFi/WiGig/WiDi• FHD


20

Automotive electronics are increasing, besides infotainment, some becomes mandatory such as TPMS, RCM, LDM; SMART Car

1M EV in 2015

CrystalXO

• 3G/4G/B4G• BT• WiFi/WiGig/WiDi• GPS• NFC• FHD

82M new cars being produced in 2012EV will needs more timing productsFor related electric management


21

Point to point microwave radio

Base station(RRU*3 / BBU)

SwitchesStorage

IP router FTTH/xPONOLT

SONET/SDHDWDM

Voice, Data, Image Cloud/Mobile Computing – More Bandwidth – Higher SpeedVCXO

S3TCXOOCXO

CrystalXO/MO

Base Station, Femtocell, Network, Storage must be ready for SMART applications


22

TXC target markets; SMART applications both wireless and wireline

Smartphone 850MSmartphone 850M

NB 200MNB 200M

HDD530MHDD530M

SSD90MSSD90M

Smart Grid110MSmart Grid110M Medical Medical Automotive

62M new carAutomotive62M new car

Server9MServer9M

Femtocell16MFemtocell16MBase StationBase Station

Tablet 130MTablet 130M

SmartTV255MSmartTV255M

STB/SmartBox108MSTB/SmartBox108M

DSC85MDSC85M

Gaming70MGaming70M Smart CardSmart Card

Voice, Data, Image – Cloud/Mobile Computing – Smart Connected – More Bandwidth – Higher Speed Voice, Data, Image – Cloud/Mobile Computing – Smart Connected – More Bandwidth – Higher Speed

NFCMobile wallet

NFCMobile wallet

Convertible PCAIO, Touch

Convertible PCAIO, Touch

WiFi(WiDi/WiGig)

WiFi(WiDi/WiGig)

PC+Android

PC+Android

NFCVISA/Master

ATM, AIO

NFCVISA/Master

ATM, AIO

DSLPGPUDSLPGPU

3G/4G145 LTE Networks

3G/4G145 LTE Networks

46 networks in 25

countries

46 networks in 25

countries

1 server is needed for every 600 smartphones or 122 tablets

Megabyte, Terabyte HDD/SSD

1 server is needed for every 600 smartphones or 122 tablets

Megabyte, Terabyte HDD/SSD

Energy efficiencyEnergy

efficiencyHealth & Fitness

Health & Fitness

MandatoryTPMS,

RCM, LDM

MandatoryTPMS,

RCM, LDM

Survive the RED, penetrate the BLUE


SMART market strategy

23

• Market: Smartphone / NB / Tablet / Smart TV / Smart box / Server / HHD / SSD / DSC / Game

• Product: X’tal / TSX / XO / MO / TCXO • Strategy: Economic Scale / Low cost solution

RED

• Market: Infrastructure / Femtocell / Networks• Product: VCXO / Stratum-3 TCXO / OCXO• Strategy: Technology / Performance / Application

KnowledgeBLUE

• Market :Smart Grid / Smart card / Medical• Product: X’tal / XO• Strategy: Time to market / Application knowledge

GRAY



Crystal & Oscillator Roadmap- Size & Performance

25

Current World Smallest 2013 2014 2015

VCXO

Crystal- 32 kHz

Crystal- MHz

MO

... 3215 / 2012 / 1610

7050 / 5032 / 3225 / 2520

Telecom <700 MHz - 1409 / 7050 / 5032 General <160 MHz- … 5032 / 3225

… 2520 / 2016 / 1612 / 1210

Crystal- MHzw/ Thermistor 2520 / 2016

SO 7050 / 5032

1008

TCXO- MHz Stratum-3 / Small Cell Grade- 5032RF / GPS Grade- … 2016 / 1612

OCXO

XO … 3225 / 2520 / 2016 / 1612

3627 / 2525 / 2020

2016 1612

1210

0806 (Crystal / MEMS)

1008 (Crystal / MEMS)

1612

General- 2520

XO/TCXO- 32 kHz 3225/2520 TCXO (<5 uA)

MHz XO Divided Down-7050 / 5032 / 3225 / 2520

1409

1210

Double Oven

2016 TCXO (<5 uA)

1210 (<24 MHz)

1612 (<1 mA)

7050 / 5032 (<50 ppm)

Telecom- 7050 / 5032 (Ultra Low Phase Noise)

RF / GPS Grade- 1210Stratum-3 / Small Cell Grade- 7050

3215 TF XO (<2 uA)


New Product (3-1 Light Sensor)

IRProximity

+Ambient Light

IRProximity

+Ambient Light

2 in 1 (Current) 3 in 1 (New)

3in1 Light Sensor – PS + ALS + IR LEDProximity Sensor (PS) + Ambient Light Sensor (ALS) + IR LED

Feature:

• ALS Spectral Sensitivity is Close to Human Eyes

• Support 16-Bit Format Via I2C Interface

• 50/60Hz Noise Rejection Filter

• Power Saving Mode, Low Power Consumption

• Different Package Structure (Stack Type for Smaller Size)


TXC LED BU Products

27

• 2011 Q2 2” SSP• 2011 Q3 4” SSP• 2012 Q1 6” SSP• 2012 Q4 2” PSS• 2013 Q1 4” PSS• 2013 Q3 6” PSS

• 2011 Q3 32KGs• 2011 Q4 85KGs

• 2011 Q3 2” Ingot• 2011 Q4 4” Ingot• 2011 Q4 6” Ingot• 2012 Q4 8” Ingot


0.43%

1.67%

2.36%

1.96%

2.53%

2.17% 2.15% 2.13%

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

2012-09 2012-10 2012-11 2012-12 2013-01 2013-02 2013-03 2013-04

TXC

合晶 WW

佳晶 PTC

銳捷 RGT

晶美 CAT

兆遠 CWT

鑫晶鑽 ACTC

TXC ShareRate

K NTD

After PSS production line is established, we are ready to be a competitive supplier.We are one of the major supplier of Top2 Epi-house in Taiwan, and keeping expanding our share rate.

TXC’S LED Business VS. Competitors

Source: TXC Corporation



30

Event Update

01• 2013.05 Pass leading product plan of Industrial Development

Bureau of the Ministry of Economic Affairs (SENSOR)

02• 2013.04 Apply for advanced version of corporate

governance evaluation

03• 2013.02 Obtain 1st Taiwan Mittelstand Award

04• 2012.07 Obtain ‘A++’ of Transparency Disclosure

Rankings

05• ~2013 Continue various environmental, safety and

health system authorization


31

Summary

01• Revenue will grow gradually and stably. Price Pressure

incurs from competitors.

02• Gross margin is maintained and supposed to be higher

than Q1.

03• Smart Devices continue to grow strongly, especially in

China smartphone and tablet market.

04• 4G application is the major driving force for high-end

products along with raising Cloud Computing.

05• New products are on market smoothly and will bring

growth momentum.


32

Thank you


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Investment Conference - TXC · PDF fileInvestment Conference May, 2013 Think of Frequency, Think of TXC. Content ... • NFC • FHD Think of