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Coremax Group
Coremax Corporation
2017 Q3 Investor Conference
Stock Code: 4739
Presented by:Jim Ho Date:2017.12.11
Safe Harbor Notice
The presentation and discussion contain certain forward-looking statements with respect to the results of operation, financial condition and current expectation. The forward-looking statements are subject to known and unknown uncertainties and risks that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include but are not limited to the impact of competitive products and pricing, ability to ramp new products into volume, industry wide shifts in supply and demand for products, industry overcapacity, availability of manufacturing capacity, financial stability in end markets, and other risks.
This document is not and cannot be construed as an offer to purchase or sell securities or other financial products or solicitation of an offer.
December 2017 1/27
Agenda
Company Profile
Group Structure
2017 Q3 Financial Results(Certified by Accountant)
Consolidated Statements of Comprehensive Income
Sales Breakdown by Products
Consolidated Gross Margin
Consolidated Operating Expenses
Consolidated Operating Income
Consolidated Net Income
Consolidated EPS
From Jan. to Aug. 2017 Global Market of New Energy Vehicles
End Sales of Petrol and Diesel Vehicles Plans-By Country
LiB Market-Sales Forecast of New Energy Vehicles
Development of New Energy Vehicles Affected Nickel Demand
Development of New Energy Vehicles Affected Cobalt Demand
Main Application of Cathode Material
Important Event
December 2017 2/27
South
America
North
America
Africa
Europe Asia Hsinchu, Taiwan (HQ) – 1992
Plant Size : 14,190m2
Ningbo, China – 2004
Plant Size : 10,036m2
Australia
Zhuhai, China – 2001
Plant Size : 13,334m2
Zhangzhou, China - 2011
Plant Size : 21,361m2
Rayong, Thailand – 2009
Plant Size : 5,288m2
Taichung, Taiwan – 1984
Plant Size : 7,938m2
Jiangxi, China– 2000
Plant Size : 17,034m2
Toufen, Taiwan – 1961
Plant Size : 71,263m2
Jiangxi, China– 2000
Plant Size : 17,034m2
Company Profile
Founded in 1992
Capital:NTD7.57 Billion
Number of Employees
376 Persons
Head Office
11 Wenhua Rd.,
Hsinchu Industrial Park
Main Products
Catalyst
Power Battery Materials
Chemical Fertilizer
Specialty Chemicals
December 2017 3/27
Group Structure
Coremax Corporation
June 1992
Coremax (BVI)
November 2001
Coremax Zhuhai Chemicals Co., Ltd.
December 2001
Coremax Ningbo Chemicals Co., Ltd.
September 2004
Coremax (Thailand) Co., Ltd.
March 2009
Coremax (Zhangzhou)
Chemicals Co., Ltd.
October 2011
Heng I Chemical Co., Ltd.
May 1961
Uranus Chemicals Co., Ltd.
July 1975
Jiangxi Tianjian
Materials Co., Ltd. January 2001
100% 80.18% 83.6%
100% 100% 100% 70.06% 100%
11.15% 6.85%
December 2017 4/27
Consolidated Statements of Comprehensive Income
Item 2017Q1-Q3 2017Q1-Q2 2016Q1-Q3 QoQ YoY
Sales Revenue 3,656,712 2,359,195 2,982,446 55% 23%
Gross Margin 15% 14% 9% 0.01 0.06
Operating Expenses 165,444 110,652 156,768 50% 6%
Operating Margin 10% 9% 3% 0.01 0.07
Non-operating incomes
and expenses 11,022 3,521 154,820 213% -93%
Net Income 317,604 188,166 212,183 69% 50%
Net Margin 9% 8% 7% 0.01 0.02
EPS 3.92 2.36 2.76 66% 42%
Unit:NTD Thousand
December 2017 5/27
2017Q3 Sales Breakdown by Products
Catalyst 12%
Power Battery 40% Chemical
Fertilizer 18%
Specialty Chemicals 12%
Others 18%
Catalyst
Power Battery
Chemical Fertilizer
Specialty Chemicals
Others
Catalyst Power Battery Chemical
Fertilizer
Specialty
Chemicals
Others Total Sales
Revenue
156,109 518,959 232,107 156,686 233,656 1,297,517
Unit:NTD Thousand
December 2017 6/27
2017Q1-Q3 Sales Breakdown by Products
Catalyst 12%
Power Battery 36%
Chemical Fertilizer 17%
Specialty Chemicals 15%
Others 20%
Catalyst
Power Battery
Chemical Fertilizer
Specialty Chemicals
Others
Catalyst Power Battery Chemical
Fertilizer
Specialty
Chemicals
Others Total Sales
Revenue
462,179 1,298,283 623,763 549,224 723,262 3,656,712
Unit:NTD Thousand
December 2017 7/27
Quarterly Sales Breakdown by Products
10%
13% 13% 12%
0%
2%
4%
6%
8%
10%
12%
14%
2016Q3 2017Q1 2017Q2 2017Q3
Catalyst YoY:43.36% ; QoQ:11.96%
32% 32% 34%
40%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2016Q3 2017Q1 2017Q2 2017Q3
Power Battery YoY:58.79% ; QoQ:40.04%
19% 17%
16% 18%
0%
5%
10%
15%
20%
25%
2016Q3 2017Q1 2017Q2 2017Q3
Chemical Fertilizers YoY:15.39% ; QoQ:32.13%
16%
14%
20%
12%
0%
5%
10%
15%
20%
25%
2016Q3 2017Q1 2017Q2 2017Q3
Specialty Chemicals YoY:-8.07% ; QoQ:-28.59%
December 2017 8/27
Consolidated Gross Margin
9%
14% 15%
0%
2%
4%
6%
8%
10%
12%
14%
16%
2016Q1-Q3 2017Q1-Q2 2017Q1-Q3
December 2017 9/27
98
72
107
3
1
2
56
38
56
0
20
40
60
80
100
120
140
160
180
2016Q1-Q3 2017Q1-Q2 2017Q1-Q3
Selling Expenses
R&D Expenses
Administrative Expenses
Consolidated Operating Expenses
157
111
165
Operating Expenses
YoY:6% ; QoQ:50%
Unit:NTD Million
December 2017 10/27
99
220
369
0
50
100
150
200
250
300
350
400
2016Q1-Q3 2017Q1-Q2 2017Q1-Q3
Operating Income
Consolidated Operating Income
10%
9%
3%
0%
2%
4%
6%
8%
10%
12%
Operating Margin
YoY:272% ; QoQ:68%
Unit:NTD Million
December 2017 11/27
212 188
318
0
50
100
150
200
250
300
350
2016Q1-Q3 2017Q1-Q2 2017Q1-Q3
Net Income
Consolidated Net Income
9%
8%
7%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
Net Margin
YoY:50% ; QoQ:69%
Unit:NTD Million
December 2017 12/27
2016Q1-Q3 2017Q1-Q2 2017Q1-Q3
EPS 2.76 2.36 3.92
2.76
2.36
3.92
0
1
2
3
4
5
Consolidated EPS Unit:NTD
December 2017 13/27
From Jan. to Aug. 2017 Global Market of New Energy Vehicles
Top 15 Sales from Jan. to
Aug. : 366,000 units. The
market share is around
56%.
There are 4 PHEV of the top
15 Sales:Prius、Chevrolet volt、BYD Song
DM、Roewe eRX5,Total
78,000 Units.
Top 1 sales is Nissan Note
with huge advantages.
Total Sales 68,000 units.
There are 6 Self-owned
brands. Total Sales 116,000
units. The market share is
around 18%.
12,012
15,494
15,975
16,101
16,502
17,292
18,419
21,393
24,562
27,507
28,750
32,524
33,684
68,096
Roewe eRX5
Saab
BYD E5
Song DM
Chevrolet Volt
BMW i3
Model X
ZOE
Model S
D2
EC 180
Leaf
Prius
Note
Top 10 Sales of New Energy Vehicles From Jan. to Aug. 2017
Sources:2017 China International Nickel & Cobalt Industrial Forum
BEV
PHEV
Unit: Units
December 2017 14/27
End Sales of Petrol and Diesel Vehicles Plans-By Country
2013 MoU 8 States 2025 Sales 3,300, 000 units of ZEV
2016 Bill Ban sales of petrol and diesel vehicles by 2025
2016 Reported by Official Site
All new cars sold by 2025 should be BEV or PHEV
2016 Bill Ban sales of Internal combustion engine vehicles by 2030
2017 Bill Ban sales of petrol and diesel vehicles by 2040
Netherlands
USA CARB
Norway
Germany
United Kingdom
Sources:2017 China International Nickel & Cobalt Industrial Forum December 2017 15/27
LiB Market-Sales Forecast of New Energy Vehicles
0
500
1000
1500
2000
2500
3000
3500
4000
Y2011 Y2012 Y2013 Y2014 Y2015 Y2016 Y2017E Y2018F Y2019F Y2020F
Sales Forecast of New Energy Vehicles (KUnits/Year)
Global Market
China Market
Forecast sales of new energy vehicles in 2017 will be expected to reach 1200K units. The
sales in China will be around 650K units;
Forecast sales of new energy vehicles in 2020 will be expected to reach 3500K units. The
sales in China will be around 2000K units.
Sources:2017 China International Nickel & Cobalt Industrial Forum
December 2017 16/27
Development of New Energy Vehicles Affected Nickel Demand
0
20000
40000
60000
80000
100000
120000
140000
160000
Y2013 Y2014 Y2015 Y2016 Y2017E Y2018F Y2019F Y2020F
Nickel Demand of LiB Cathode Material(Ton/Year)
Nickel Demand of NCM811
Nickel Demand of NCM622
Nickel Demand of NCM523
Nickel Demand of NCM333
Nickel Demand of NCA
Forecast nickel demand of cathode material in 2017 will be expected to reach 53,000 tons. 50%
of the nickel demand comes from NCM523;
Forecast nickel demand of cathode material in 2020 will be expected to reach 140,000 tons.
Over 50% (over 70K tons) of the nickel demand comes from nickel-rich NCA and NCM811;
Sources:2017 China International Nickel & Cobalt Industrial Forum
December 2017 17/27
Development of New Energy Vehicles Affected Cobalt Demand
0
10000
20000
30000
40000
50000
60000
70000
80000
90000
Y2013 Y2014 Y2015 Y2016 Y2017E Y2018F Y2019F Y2020F
Cobalt Demand of LiB Cathode Material(Ton/Year)
Cobalt Demand of LCO
Cobalt Demand of NCM811
Cobalt Demand of NCM622
Cobalt Demand of NCM523
Cobalt Demand of NCM333
Cobalt Demand of NCA
Forecast cobalt demand of cathode material in 2017 will be expected to reach 60,000 tons. 67% of the
cobalt demand (41,000 tons) comes from LCO. 33% of the cobalt demand (21,000 tons) comes from NCM &
NCA.
Forecast cobalt demand of cathode material in 2020 will be expected to reach 80,000 tons. 56% of the
cobalt demand (45,000 tons) comes from LCO. 44% of cobalt demand (35,000 tons) comes from NCM &
NCA.
Sources:2017 China International Nickel & Cobalt Industrial Forum
December 2017 18/27
Main Application of Cathode Material
Cathode Material
LCO
Smart Phone
Tablet PC
UAV
Wearable devices
NCM
EV
Note Book
Power Tool
NCA
EV
Power Tool
LMO
Low-end Phone
E-Bus
LFP
EV
Energy Storage
Sources:2017 China International Nickel & Cobalt Industrial Forum
December 2017 19/27
Important Event
December 2017 20/27
At 10/31, # 47392, convertible bondⅡ, roughly NT $36.2
million has not been converted, the expected
conversion shares of about 682,000 shares.
After the $36.2 million converted, the capital will be NT
$868 million.
The company's third power battery material production
line is operation now, the current production rate is
about 50%, still under process adjustment stage.
CoreMax Your Best Choice! Best Partner!
Thank you for your attention!
December 2017 21/27
1992 First catalyst production line started.
1994 First recovery catalyst production line completed.
1996 Company name changed to Coremax Taiwan Corporation.
Passed ISO 9002 certificate.
1999 Completed production line of advanced material and battery material.
2000 Obtained the Ministry of Economic Affairs subsidies for Development plan of High
performance LiB cathode material .
Company name changed to Coremax Corporation.
2001 Set up “Coremax Malaysia Sdn. Bhd.” to supply BP、Exxon Mobil PTA
Set up “Coremax Zhuhai Chemicals Co., Ltd.” to exclusive supply catalyst to BP PTA
2004 Set up “Coremax Ningbo Chemical Co., Ltd.” to supply Formosa Chemicals (Ningbo) and
Ningbo Mitsubishi Chemical.
Annex I Corporate Milestone-1
2009 Set up “Coremax (Thailand) Co., Ltd. “ to supply TPT PTA and Siam Mitsui PTA
Passed ISO 14000 certificate.
Expanded battery material production line in Hsinchu Taiwan.
Invested Heng-I Chemical Co., Ltd.
December 2017 22/27
2011 Set up “Coremax (Zhangzhou) Chemicals Co., Ltd to exclusive supply Xianglu PTA.
Introduced Itochu Corporation to overall arrangement catalyst and battery material business.
Listed at over-the-counter market
2010 Set up battery material production line in Toufen Taiwan.
Listed at emerging stock market.
2013 Constructed sulfuric acid plant at Heng-I Chemical
2014 Set up Cobalt Sulfate production line and second Nickel Sulfate production line.
Heng-I Chemical added wasted sulfuric recovery business.
Invested Uranus Chemicals Co., Ltd.
2017 Set up third battery material production line at Toufen Taiwan.
Listed at stock exchange market.
Annex I Corporate Milestone-2
2015 Introduced JCAM AGRI and set up JCAM Taiwan.
2016 Acquired 100% share of Uranus Chemicals Co., Ltd.
December 2017 23/27
Annex II Product Categories and Applications
Application Sales Percentage End Products
Catalyst
(≒12%) PTA、PIA、PET
Specialty Chemicals
(≒12%)
Tire adhesive
promoter,
Semiconductors、Panel
Chemical Fertilizer
(≒17%) Agriculture
Power Battery
(≒36%)
Lithium battery-
precursor、
Printed circuit board
December 2017 24/27
Annex III Production Capacity-1
Catalyst Products
Co Acetate : Hsinchu Plant - 1,200 MT/Year (100 MT/Month)
Ningbo Plant - 600 MT/Year (50 MT/Month)
Rayong Plant - 360 MT/Year (30 MT/Month)
Mn Acetate : Hsinchu Plant - 1,200 MT/Year (100 MT/Month)
Ningbo Plant - 600 MT/Year (50 MT/Month)
Rayong Plant - 360 MT/Year (30 MT/Month)
Co/Mn Liquid : Hsinchu Plant - 9,000 MT/Year (750 MT/Month)
Zhuhai Plant - 2,400 MT/Year (200 MT/month)
Ningbo Plant - 9,000 MT/Year (750 MT/Month)
Rayong Plant - 6,000 MT/Year (500 MT/Month)
Zhangzhou Plant - 9,000 MT/Year (750 MT/Month)
December 2017 25/27
Annex III Production Capacity-2
Power Battery Products
Co Oxide : Hsinchu Plant - 960 MT/Year (80 MT/Month)
Co Sulfate : Hsinchu Plant - 4,800 MT/Year (400 MT/Month)
Ni Sulfate : Toufen Plant L1 & L2 - 14,400 MT/Year (1,200 MT/Month)
Toufen Plant L3 - 18,000 MT/Year (1,500 MT/Month)
December 2017 26/27
Annex III Production Capacity-3
Specialty Chemicals
Co Hydroxide : Hsinchu Plant - 1,680 MT/Year (140 MT/Month)
Industrial Grade Sulfuric Acid : Toufen Plant - 99,000 MT/Year (8,250 MT/Month)
Electronic Grade Sulfuric Acid : Toufen Plant - 66,000 MT/Year (5,500 MT/Month)
Etching Solution : Hsinchu Plant - 9,000 MT/Year (750 MT/Month)
Oxalic Acid : Taichung Plant - 3,000 MT/Year (250 MT/Month)
Chemical Fertilizer Products
N.P.K. Mixed Fertilizer : Toufen Plant - 72,000 MT/Year (6,000 MT/Month)
Organic Compound Fertilizer : Toufen Plant - 30,000 MT/Year (2,500 MT/Month)
Ammonium Sulfate : Toufen Plant - 7,500 MT/Year (625 MT/Month)
December 2017 27/27