2

Content

Company OverviewCompany Overview

Sales & MarketingSales & MarketingProducts & TechnologyProducts & Technology

Financial OverviewFinancial Overview

New BusinessNew Business

3

Company Profile

• TXC Corporation, founded in 1983, is a leading professional frequency control

product manufacturer. We have devoted to the research, design, manufacture, and

sale of Dual-Inline-Package (DIP) and Surface Mount Device (SMD) quartz crystal

products. TXC now specializes in five categories of products such as high quality

Quartz Crystal, Crystal Oscillator (CXO), Tuning Fork (TF) Surface Acoustic Wave

(SAW) Filter, and Timing Module (TM). In addition, to develop the Group’s future

development and the application of core technical capabilities , in the Q2 of 2011,

the company imports the LED substrate and wafer process and formally enters into

the sapphire LED field.

• Our goal is to add value to our customers by providing a complete solution of

frequency devices and modules, design-in service to fully satisfy various needs of

the esteemed customers. We believe based upon the competence of cost

effectiveness, quality, lead-time, and customer service TXC will go beyond

customers' expectation.

• www.txccorp.com

4

1983

Established TCXO Production

Established SMD Production

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 20061984 …

Implemented Oracle ERP

Founded- Capital US$ 95,000

IPO’ed- Increased Capital to US$ 34.8M

Listed in Taiwan Security Exchange (Code- 3042)

Completed Ningbo Factory in China

2007

Total Capacity up to 186 M/month

2008 2009

Ranked 4th

Business

TS16949

6 Sigma

IECQ QC080000

ISO 14001:1996 ISO 14001:2004

2010

Quality

Paid-in Capital: US$102M

Taiwan National Quality Award

2011 Establishing Chongqing Factory in China

Established SAW Production

2011

Green Product Policy & QS 9000

ISO 9001:2000

Production

PAS2050:2008

ISO 14064-1:2006

OHSAS18001:2007

Milestones

5

Headquarter - Taiwan Taipei

Factories(2)- Taiwan Ping-ChengChina NingboChina Chong-Qing (2012)

Sales FAEs(10) - Taiwan TaipeiField Application Engineer China Shanghai, Suzhou, Shenzhen, Wuhan

USA LAJapan Yokohama, OsakaEuropeSingapore

Distributors(12)- Europe-UK, Germany………

Representative (8)- Korea, India, Mexico…….

Worldwide Locations

66

Automotives

Communications & Telecom

Wireless & Wirelines

Security

Energy & Lighting

Industrial

Medical

Consumer Electronics

Audio, Video & Imaging

Computing & Peripherals

Crystal & OscillatorConnecting Technology Together

Miniaturization Stable(Ex. Smart Phone)(Ex. WLAN)

Ultra stableHigh FrequencyAOM/TCXO

(Ex. Base Station)(Ex. GPS)

MiniaturizationUltra stableZero Defect(Ex. Medical Device)

Ultra stable Zero defect

(Ex. Automotive products)

Miniaturization Price Competitive

(Ex. LED TV)

StablePrice Competitive

(Ex. Digital Camera)

Miniaturization Price Competitive(Ex. NB, Tablet PC)

Miniaturization Ultra stable

(Ex. Security Door System)

StableTCXO

(Ex. Smart Grid)

Stable High Frequency

(Ex. Industrial Monitoring System)

Application v.s. Frequency Control Unit applied

1Specific requirement for different industry

7

Business Model

8

Worldwide Revenue of the Top Crystal and Oscillator Suppliers (Unit: USD in Million)

Resource: CS&A

Rank Market Player Countries 2008 2009 2010 2011

(08-09)

Change

%

(09-10)

Change

%

(10-11)

Change %

2008

Market

Share

2009

Market

Share

2010

Market

Share

2011

Market

Share

1 Epson Toyocom Japan 675 641 793 592 -5.01% 23.69% -25.36% 19.90% 22.10% 22.72% 16.73%

2 NDK Japan 571 459 547 557 -19.60% 19.23% 1.75% 16.90% 15.80% 15.68% 15.74%

3 KDS Japan 327 271 391 389 -17.03% 44.01% -0.44% 9.70% 9.40% 11.19% 10.99%

4 TXC Taiwan 222 241 301 327 8.33% 25.16% 8.64% 6.60% 8.30% 8.62% 9.24%

5 Kyocera Kinseki Japan 304 292 297 265 -3.82% 1.47% -10.68% 9.00% 10.10% 8.50% 7.49%

6 Ventron USA 200 148 205 196 -26.05% 38.61% -4.39% 5.90% 5.10% 5.87% 5.54%

7 RakonNew

Zealand96 82 106 111 -15.10% 29.94% 4.82% 2.80% 2.80% 3.03% 3.14%

8 Hosonic Taiwan 119 97 109 101 -18.24% 11.61% -7.00% 3.50% 3.40% 3.11% 2.85%

9 Taitien Taiwan - - 75 79 - - 5.19% - - 2.15% 2.23%

10 TEW Japan 75 60 66 59 -19.87% 9.98% -10.74% 2.20% 2.10% 1.89% 1.67%

11 Micro Crystal Switzerland 56 48 57 63 -15.18% 20.00% 10.53% 1.70% 1.60% 1.63% 1.78%

12 Pericom USA 53 48 56 52 -10.19% 18.07% -7.47% 1.60% 1.60% 1.61% 1.47%

13 River Japan 51 41 47 52 -20.00% 14.95% 10.87% 1.50% 1.40% 1.34% 1.47%

14 Conner-Winfield Singaopre 44 35 39 41 -20.23% 10.26% 5.94% 1.30% 1.20% 1.11% 1.16%

- Others - - - 402 655 - - - - 11.52% 18.51%

Total

Revenue 3,388 2,900 3,490 3,539 -14.39% 20.36% 1.39%

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TXC Competitors of Japan

Competitors of Taiwan

Competitors of China

Overhead Cost

Quotation advantage due to JPY appreciation

High Low High High

Market Focus

Flexibility

Relationship with ODM

High Low High Low

Diversification

Ability Of Production Line

Transfer

Economic Scale

Manufacturing Technology

Quality Control

LowMediumHighMedium

Asia(Growing)

High

HighPC, Automotive,

Networking, Mobile, Consumer, Global

High

High(SMD)High

2016,1612,1210

High

USA, Europe(Declining)

Low

HighAutomotive,

Networking, Mobile, Consumer, Global

High

Highest(SMD & TCXO)

High1612,1210

Highest

Asia(Growing)

High

LowSpecific to one or two

field

Medium

Low

Medium2520,2016

Medium

China(Growing)

High

LowPC, Consumer

Medium

High(DIP)Low

3225,2520

Low

10

31%19%

22%40%

20%

18%5%

25%

9%

Unit: USD in Million

PC20%

MOBILE30%

NETWORKING26%

CONSUMER9%

AUTOMOTIVE2% Others

11%

SAPPHIRE2%

PC25%

MOBILE28%

NETWORKING24%

CONSUMER8%

AUTOMOTIVE2%

Others13%

SAPPHIRE0.1%

11

KHz X'tal8%

MHz X'tal62%

Others8%

TCXO8%

VCXO1%

CXO13%

KHz X'tal4%

MHz X'tal58%

Others9%

TCXO16%

VCXO1% CXO

12%

12

1,394 

1,824 

2,217  2,292 2,113 

2,338 2,510 

2,689 

2,322 2,476  2,495 

2,605 2,394 

‐22.69%

30.88%

21.55%

3.39%

‐7.84%

10.69%

7.33% 7.14%

‐13.65%

6.63%0.77%

4.45%

‐8.10%

‐30%

‐20%

‐10%

0%

10%

20%

30%

40%

0

500

1,000

1,500

2,000

2,500

3,000

09.Q1 09.Q2 09.Q3 09.Q4 10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1

Quarterly Revenue QoQ Revenue Growth

13

Unit: $NT in Million

1414

Unit: $NT in Million

273 

422 

576 633 

532 

629  696 

679 

576 609  630 

586 

522 

19.61%

23.15%

26.00%27.59%

25.16%

26.91% 27.75% 25.20%24.63%24.69% 25.25%

22.50%21.80%

0%

5%

10%

15%

20%

25%

30%

0

100

200

300

400

500

600

700

800

09.Q1 09.Q2 09.Q3 09.Q4 10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1

Quarterly Gross Profit Gross Margin

1515

69 

170 

260 283 

213 

331 361 

285  237 248 

305 

260  199 4.97%

9.31%

11.74%12.34%

10.08%

14.15% 14.37%

10.61%

10.13% 10.02%

12.23%

9.98%

8.31%

0%

2%

4%

6%

8%

10%

12%

14%

16%

0

50

100

150

200

250

300

350

400

450

09.Q1 09.Q2 09.Q3 09.Q4 10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1

Quarterly Net Profit Net Margin

Unit: $NT in Million

16

Amounts Notes Amounts Notes

Ping‐Cheng Factory 1,058 a. TCXO/AOM*5

b. Sapphire Equipment

c. RD Equipment

600 a. TCXO/AOM*5(Back‐end of line)b. Sapphire Euipment

NGB Factory 250 Tuning Fork*3

Miniature X'tal*2

250 Miniature X'tal*5

Total 1,308 850

CKG Factory 156 Factories & Equipments 348 Factories & Equipments

Mass Production

(2012/2013)

2011 2012(f)

Factories

c. RD Euipment

Unit: $NT in Million

17

• Compensation payable to directors and supervisors– 2%(2011)

• Employee Bonus– 12%(2011)

2005 2006 2007 2008 2009 2010 2011

Earning Per Share 2.73  4.13  4.88  3.56  2.75  4.06  3.48

Cash Dividend Per Share 0.99  1.94  1.98  2.00  2.00  2.50  2.2

Stock Dividend Per Share 0.59  0.97  0.99  0.50  0.20  0.20  0

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

18

19

Source: DIGITIMES Feb, 2012

2011 2012

Existing Customers

20

Taiwan

Japan

China

Korea

Focus on the 4” Sapphire Wafer Market. & Successfully approved and running into the warm-up production stage

Closely co-work with Japan partner to step into the Japan 4”& 6” Market. Product is approval and under line auditing

Hesitate and initially approach the potential China customers .

Contact with the potential customer and sampling approving of the 4”& 6” Wafers

21

0

5000

10000

15000

20000

25000

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.

4" Capacity(pcs) Sales amount(pcs)Sales (pcs)

22

23

Revenue will grow gradually and stably.

Gross margin expected to be greater than Q1.

China market is still growing strongly, especially in smartphone, tablet and infrastructure sectors.

4G application is the major driving force for high-end products along with raising Cloud Computing.

New products are on market smoothly and will bring growth momentum.