Investor Conference³•說會簡報-EN.pdfMS BS 27.1% Last Update 2018.10.31 number s 50 100 150...

Daxin Materials Corporation

Investor Conference

2018.12.11

Daxin proprietary & confidential 1

� Daxin’s presentation contains forward-looking

statements subject to significant risks and

uncertainties. Actual results may differ materially from

those contained in the forward-looking statements .

� The forward-looking statements in this release reflect

the current belief of Daxin as of the date of this

release, we undertake no obligation to update these

forward-looking statements for new information, future

events, or otherwise .


�� Company ProfileCompany Profile

�� Operating ResultOperating Result

�� Operational Highlights & OutlookOperational Highlights & Outlook


Company ProfileCompany Profile


Company profileCompany profile

Foundation July 12th, 2006 (JV of AUO & Eternal Chemical)

Paid-in capital 1,027 million NTD

Employees340 (until Oct., 2018)


Employees340 (until Oct., 2018)R&D ~52.1%

IPO on TAIEX July, 16th, 2012 (Code：5234)

RevenueY2017：3,917million NTDY2018/1~11：4,025 million NTD

Major productsSpecialty Chemicals for Display, Green Technology, and Semiconductor.

Sales OfficeSuzhou

Sales Office

Headquarters/R&D Center

AMC I – Taichung

Sales OfficeShenzhen

Sales OfficeTaoyuan

AMC II – Taichung Harbor


Key Key

InstrumentInstrument

AnalysisAnalysis

DisplayDisplay


SemiconductorSemiconductor

Key Key

ComponentsComponents

GreenGreen

Over 50% of total employees are R&D

Phd23.7%

MS

BS27.1%

Last Update ：2018.10.31

nu

mb

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100

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350

Application & Approved License

nu

mb

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200

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350

Application & Approved License

num

bers


MS49.2%

Until end of 2018, approved patent license number expect to be 228,

application number expect to be 315.

Y2015 Y2016 Y2017 Y2018Application 267 286 297 313Approved License 148 181 213 2210

50 Y2015 Y2016 Y2017 Y2018Application 267 286 297 313Approved License 148 181 213 2210

50

Operating ResultOperating Result


Unit：NTD M QoQ% YoY%Net revenue 1,127 100.0% 1,057 100.0% 6.6% 1,030 100.0% 9.4% Cost of sales 741 65.7% 704 66.6% 5.3% 718 69.7% 3.2% Gross profit 386 34.3% 354 33.5% 9.0% 312 30.3% 23.7% Operating expenses 192 17.0% 180 17.0% 6.7% 158 15.3% 21.5% Profit from operations 195 17.3% 174 16.5% 12.1% 153 14.9% 27.5%

2018 Q3 2018 Q2 2017 Q3Profit from operations 195 17.3% 174 16.5% 12.1% 153 14.9% 27.5% Non-operating income andexpenses 2 0.2% 9 0.9% (77.8%) 1 0.1% 100.0% Profit before income tax 197 17.5% 183 17.3% 7.7% 154 15.0% 27.9% Comprehensive income 171 15.2% 158 14.9% 8.2% 136 13.2% 25.7% Basic earnings per share (NTD) 1.66 1.54 1.32


� Basic EPS were calculated based on the weighted average outstanding shares (102,716k shares)

Unit：NTD M YoY%Net revenue 1,038 100.0% 1,057 100.0% 1,127 100.0% 3,223 100.0% 2,870 100.0% 12.3% Cost of sales 714 68.8% 704 66.6% 741 65.7% 2,159 67.0% 2,058 71.7% 4.9% Gross profit 324 31.2% 354 33.5% 386 34.3% 1,064 33.0% 811 28.3% 31.2% Operating expenses 170 16.4% 180 17.0% 192 17.0% 541 16.8% 440 15.3% 23.0% Profit from operations 153 14.7% 174 16.5% 195 17.3% 523 16.2% 372 13.0% 40.6% Non-operating income and (2) (0.2%) 9 0.9% 2 0.2% 9 0.3% (4) (0.1%) (325.0%)2018 Q1 2018 Q2 2018 Q3 Ninth months endedSep. 30, 2018 Ninth months endedSep. 30, 2017


� Basic EPS were calculated based on the weighted average outstanding shares (102,716k shares)

Non-operating income andexpenses (2) (0.2%) 9 0.9% 2 0.2% 9 0.3% (4) (0.1%) (325.0%)Profit before income tax 152 14.6% 183 17.3% 197 17.5% 531 16.5% 367 12.8% 44.7% Comprehensive income 133 12.8% 158 14.9% 171 15.2% 462 14.3% 325 11.3% 42.2% Basic earnings per share (NTD) 1.29 1.54 1.66 4.50 3.16� Benefited from the fermenting of materials technology, and driven by

product mix and growth in overseas revenue, 2018Q3 gross profit margin

was 34.3%.

3,331 3,3783,620

3,917

3,223

3.78 5.07

4.50 5.00 6.00 7.00 8.00 9.00 10.00

3,000

4,000

5,000 Unit: NTDUnit: NTD M

Net Sales EPS RAEPS

3.25 2.86 3.78 4.50

2.96 2.60 3.44

4.60 4.50

0.00 1.00 2.00 3.00 4.00

0

1,000

2,000

2014 2015 2016 2017 2018年前三季

Daxin proprietary & confidential 12Daxin proprietary & confidential 12

� Basic EPS were calculated based on the weighted average outstanding shares. (Before 2017 : 93,378k shares ; 2018 : 102,716k shares )

� RAEPS were calculated based on the weighted average outstanding shares, which is 102,716k shares.

Nine Months2018

Unit: NTD M DIFF %Cash and cash equivalents 192 5.3% 123 3.8% 69 56.1% Accounts receivable 1,373 37.9% 1,303 40.1% 70 5.4% Inventories 260 7.2% 185 5.7% 75 40.5% Financial assets measured atamortized costs, current 433 11.9% 402 12.4% 31 7.7% Property, plant and equipment 1,310 36.1% 1,178 36.2% 132 11.2% Total assets 3,626 100.0% 3,250 100.0% 376 11.6%

Sep. 30, 2018 Sep. 30, 2017


� Current ratio=Current assets ÷ Current liabilities

� Calculated by dividing the average inventory into the annualized cost of goods sold during such period, then multiplying by 365 days

� The balance of cash and cash equivalents end of 2018/9/30 and 2017/9/30 add more than three months time deposit were 621M and 523M.

Current liabilities 1,174 32.4% 1,080 33.2% 94 8.7% Long-term interest-bearing debts - 0.0% - 0.0% - 0.0% Total liabilities 1,174 32.4% 1,081 33.3% 93 8.6% Total equity 2,452 67.6% 2,169 66.7% 283 13.0%

Key financial highlightsCurrent ratio 196% 190%Inventory Turnover (Days) 30 25

Unit: NTD MNine months endedSep. 30, 2018 Nine months endedSep. 30, 2017

Income before income tax 531 367Depreciation and amortization 132 116Other operating activities (73) (52)

Net cash provided by operating activities 537 397


� The balance of cash and cash equivalents end of 2017/9/30 and 2016/9/30 add more than three months time deposit were 621M and 523M.

Acquisition of property, plant and equipment (140) (219)Net cash used in investing activities (160) (230)

Increase in short-term borrowings - 90Repayments of long-term borrowings (56) (76)Cash dividends paid (327) (280)

Net cash usded in financing activities (383) (266)

Net decrease in cash and cash equivalents (6) (99)Cash and cash equivalents at end of period 192 123

China, 26.2%

Others, 1.8%

2018 Q3

211224

257

315

19.6% 20.1%21.6%

24.3%

28.0%

20%

25%

30%

200

250

300

350

Unit: NTD M Export sales and the proportion


Taiwan, 72.0%

202 211224

0%

5%

10%

15%

0

50

100

150

200

2017Q3 2017Q4 2018Q1 2018Q2 2018Q3

� Sustainable growth of export proportion.� 2017 was18.0%, nine months ended 2018 was 24.7%.

Year EPSCash

DividendsStock

DividendsDividend

Payout Ratio

2017 5.07 3.5 1.0 89%

2016 3.78 3.0 0.0 79%

2015 2.86 2.0 0.0 70%


2015 2.86 2.0 0.0 70%

2014 3.25 2.2 0.0 68%

2013 4.62 3.0 0.5 76%

� Basic EPS were calculated based on the weighted average outstanding shares.(2013 : 88,932k shares ; After 2014 : 93,378k shares )

� Dividend Payout Ratio = (Cash Dividends +Stock Dividends) ÷ EPS� Maintain a high dividend policy.

Operational Highlights & OutlookOperational Highlights & Outlook


DisplayDisplay

� LCD PS : Maintain leading position of worldwide market share.

� LCD PI alignment layer : Stable supply and sustainable growth

of Gen 8.5 above production line.

� LCD Cu Etchant, BM : Implement new customers and Gen 8.5

above supply chain successively.

� Sustainable growth of export proportion. (up to 28% in Q3)

Daxin proprietary & confidential 18Daxin proprietary & confidential 18

GreenGreen

OthersOthers

SemiconductorSemiconductor� Fan-Out advanced packaging materials : Released and

started shipping to market as the 1st source supplier.

(Both Wafer & Panel form customers)

� LIB materials : small quantity delivery.

� Commence business of instrument analysis services.

20172017 20182018 20192019

- PSA PI

- Cu/Ti Etchant

- PSA PI (High Adhesion)

- High Resolution HPS

- UV2A PI

- PI-less LC

- FFS LC (5V/14ms)

- PSA LC

DisplayDisplay


- Cu/Ti Etchant

- OLED PLN/ PDL/ PS

- 3D CG BM/ WM

- PI Substrate

(OLED / EPD / LCD / TP)

- High Resolution HPS

- High Resistance/High OD BM

(BM OD 4.5)

- RGB (High T%)

- 2.5D/3D CG OC0

- PSA LC

- Gen 3 Cu Etchant

- Flexible EPD PLN

- Materials for Foldable Cover Film

- QD Materials

- MicroLED OC0 & Bank WM/BM

� In 2019, keep developing new materials for next generation displays.

Expand market share and material applications of display market.

20172017 20182018 20192019

- Release Layer (Wafer)- Release Layer (Panel)

- 2-in-1 TBA (Panel)

- 2-in-1 Release Layer

- Temporary Protection Layer

- High Purity Solvent

SemiconductorSemiconductor


- Release Layer

- Cleaner

- RDL Dielectrics

- 2-in-1 TBA (Panel)

- Thinner

- Low Temp RDL Dielectrics

- High Purity Solvent

- Passivation Layer

- Photosensitive Low Df Dielectrics

- High Resolution Dielectrics

- EMI Shielding Materials

� In 2019, we make all-out effort to develop the new class of

indirect and direct materials by cultivating our core technologies

for the future of advanced packaging.

20172017 20182018 20192019

- Slicing Beam- Binder for Si-based - Si powder for Si-based Anode in LIB

GreenGreen


- Slicing Beam- Binder for Si-based

Anode in LIB

- Si powder for Si-based Anode in LIB

- Flame-Retardant Additives for Electrolyte

� The features of high energy density, high thermal stability, and

excellent flame retardancy are key development trends for EV battery.

Keep developing LIB materials by linking core technologies.

Flexible OLED Display

QD Display

MicroLED Display

DisplayDisplay


Circular Economy

IoT

AI

Li-ion Battery

5G

ADAS

Y2019

Business

FocusSemiconductorSemiconductor GreenGreen

CECCECCECCEC

G8.5 : 60 K/MG8.5 : 110 K/M

BOE BOE --B5B5BOE BOE --B5B5

BJ

G8.5 : 140 K/M

BOE BOE -- B4B4BOE BOE -- B4B4

G10.5 : 120 K/M


BOE BOE -- B17B17BOE BOE -- B17B17CECCECCECCEC

CECCECCECCEC

G8.6 : 120 K/M

G8.6 : 100 K/M

HKCHKCHKCHKC

G8.5 : 140 K/M

SamsungSamsungSamsungSamsung

G8.6 : 90 K/M

HKCHKCHKCHKC

MP

Ramp up/ under construction

Planning


CQ

SZ

NJ

CD

XYCZHF

CSOT CSOT -- T6T6CSOT CSOT -- T6T6

G11: 60~140 K/M

WH

G8.5 : 140 K/M


G8.5 : 150 K/M


FQ

G10.5 : 120 K/M


CSOT CSOT -- T1T1 // T2T2CSOT CSOT -- T1T1 // T2T2

G8.5 : 150K + 145K/M


G11: 60~140 K/M

G8.6: 120 K/M

G8.6 : 60 K/M

HKCHKCHKCHKC

G8.5 : 60 K/M

LGDLGDLGDLGD

GZ

SZ

G10.5 : 90 K/M

FoxconnFoxconnFoxconnFoxconn

MY

� By 2022, China will have 18 production lines w/ G8above, including G8.5 & G8.6 13 lines and G10.5 5 lines.

� In 2019, China with capacity share up to 45% as the top producing region for large size LCD panels. (Source: DSCC 2018/10)

MP

Ramp up/ under construction

Planning

BOEBOE -- B7B7BOEBOE -- B7B7

G6: 48 K/M

BOE BOE -- B11B11BOE BOE -- B11B11Ordos

G6: 30 K/M

EDOEDOEDOEDO

G4.5: 21 K/M

EDOEDOEDOEDO

G5.5: 15 K/M

GVO (GVO (VisionoxVisionox))GVO (GVO (VisionoxVisionox))

G6: 30 K/M

VisionoxVisionoxVisionoxVisionox

TianmaTianmaTianmaTianma

G4.5: 30 K/M

GA


G5.5: 4 K/M


G8.5: 4 K/M



SZ

SHKS

HZ TW

CD

HF

AUOAUOAUOAUO

G3.5: 7.5 K/M

G4.5: 15 K/M (SGP)

G4.5: 30 K/M

TrulyTrulyTrulyTruly

G6: 10 K/M

RoyoleRoyoleRoyoleRoyole

WH

G6: 30 K/M


G4.5 RD line

G6: 48 K/M


CQ

G6: 48 K/M


G6: 30 K/M

TianmaTianmaTianmaTianma

G4.5 RD: 4 K/M

CSOTCSOTCSOTCSOT

MY

G6: 48 K/M


G6: 48 K/M


FQ

� By 2022, BOE with expected capacity of G6 up to 240K/M, behind Samsung & LGD, as the world’s third-tier supplier for AMOLED panels.

Need

Megatrend Applications Advanced Packaging Requirements

� Higher functionalities

�Higher bandwidth

� Higher speed

� Lower latency

5G


Five driving forces for Mid- to long-term semiconductor industry : IoTIoT, 5G, AD, AI, AR/VR., 5G, AD, AI, AR/VR.

Development of the new class of materials the new class of materials with superior functionalities is essential to

enable emerging process schemes for advanced packaging. (Fan(Fan--Out, 2.5D, 3DIC)Out, 2.5D, 3DIC)

Source : Yole/SEC

(2018/08)

� Lower power consumption

� More memory & sensors

� Tighter feature size for

further miniaturization

� Implement new products / new customers

successively.

� Increase China market share of LCD materials.

� Develop new materials for next generation

displays.

DisplayDisplay


� Expand business into new

territory. (JP, SG, US, KR, AU)

� Develop new materials for next

generation advanced packaging.

� Continue to engage new

customers for LIB materials.

� Explore new fields except

optoelectronics.

Y2019

Business

FocusSemiconductorSemiconductor GreenGreen

Q& AQ& A


Thank youThank you


Investor Conference³•說會簡報-EN.pdfMS BS 27.1% Last Update 2018.10.31 number s 50 100 150...

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Transcript of Investor Conference³•說會簡報-EN.pdfMS BS 27.1% Last Update 2018.10.31 number s 50 100 150...