Slide 1: K LASER (2461) 1Q18 Investor Conference
K LASER (2461) 1Q18 Investor Conference May 10, 2018 1
Slide 2: Disclaimer
Disclaimer • The information contained in this confidential document ("Presentation") has been prepared by K LASER (the "Company"). It has not been fully verified and is subject to material updating, revision and further amendment. • While the information contained herein has been prepared in good f
Slide 3: 1Q18 Results
1Q18 RESULTS 2 K LASER
Slide 4: 1Q18 Highlights
1Q18 Highlights ► Revenue increased 18.5% in 1Q18 versus 1Q17 to NT$1,255 mn. ► Gross Margin decreased 2.8pp in 1Q18 versus 4Q16 to 22.0%. Core Gross Margin (excluding Optivision and Everest Display) decreased 2.5 pp in 1Q18 versus 1Q17 to 28.5%. ► Operating Margin decreased 1.7pp in 1Q18 versus 4Q1
Slide 5: 1Q18 Revenue
1Q18 Revenue ► 1Q18 revenue grew as the revenue of the core business increased and the revenue of the subsidiaries also improved. 1Q18 Revenue +18.5% YoY 1,255 1,059 1Q17 1Q18 Revenue NT$ million 5
Slide 6: Hologram sales mix by customer industry
Hologram sales mix by customer industry Other Consumer Tobacco & Alcohol 15% 17% 17% 18% 19% 18% 23% 22% 23% 23% 28% 27% 24% 31% 35% 27% 32% 33% 32% 30% 57% 52% 55% 54% 58% 45% 48% 45% 45% 47% 2012 2013 2014 2015 2016* 2016** 2017* 2017** 1Q18* 1Q18** Note: Other includes glitters, decorations, mate
Slide 7: 1Q18 Gross Profit & Gross Margin
1Q18 Gross Profit & Gross Margin ► In 1Q18, K Laser’s gross margin declined while the gross profit still increased. ► 1Q18 core gross margin decreased 2.5pp to 28.5%. Gross Profit TSL as % of Revenues Gross Profit Core Gross Profit* TSL as % of core Revenues** Gross Margin Core Gross Margin* Gross M
Slide 8: 1Q18 Operating Expenses
1Q18 Operating Expenses ► Operating expense ratio decreased versus the same period last year. K Laser continues to control expenses. 1Q18 Operating Expenses Operating Expenses Operating Expense Ratio 18.7% 17.5% 198 220 1Q17 1Q18 營業費用 NT$ 百萬 8
Slide 9: 1Q18 Operating Profit
1Q18 Operating Profit ► Operating profit slightly decreased in 1Q18 versus 1Q17. 1Q18 Operating Profit Operating Profit Operating Profit Margin 6.1% 4.4% 65 56 1Q17 1Q18 Operating Profit NT$ Million 9
Slide 10: 1Q18 Earnings
1Q18 Earnings ► Net Income of NT$13 mn, an increase of 98.8% versus 1Q17. EPS of NT$0.08, an increase of 60.0% versus 1Q17. Net Income to Parent EPS 13 0.08 7 0.05 1Q17 1Q18 1Q17 1Q18 Net Income to Parent NT$ million EPS NT$ 10
Slide 11: K LASER
fi 11 K LASER
Slide 12: Appendix
APPENDIX 2 K LASER
Slide 13: About K Laser
About K Laser ► We are the largest fully integrated holographic material supplier in the world, ranking No. 1 in Consumer Packaging and top 3 in Tobacco Security in China. The global market we target is over US$ 3 bn. ► With in-house design and origination capabilities, we are a total solution provi
Slide 14: K Laser at a glance
K Laser at a glance Product sales mix ► Ticker: 2461 TT Hologram 70% ► Founded in 1988 Optical Film & 30% Projector ► 2017 Revenue: NT$5.2 bn (US$175 m) Hologram sales mix Holographic Market cap*: NT$2.51 bn (US$85 m) 32% ► paper ► Employee number **: 750+ Holographic film 20% Hot stamping ► 8 manuf
Slide 15: Corporate Structure
Corporate Structure K Laser Hologram (2461 TT) 47% 76% Optivision* Everest K Laser(TW)* R&D center (US) (3666 TT) Display Projector China International Ningbo* Optical Film US Wuxi* Thailand* Dong Guan* Japan* Changsha* Dubai India* Hong Kong Korea* * With manufacturing facilities 15
Slide 16: Industry Leader
Industry Leader Products K Laser The largest fully integrated holographic Hologram material supplier in the world is the sole supplier No. 1 in Consumer Packaging Market Our and top 3 in Tobacco Security Market Consumer focus Security in China & Tobacco labels, industry packaging & Capturing a US$3b
Slide 17: TSL – What is it?
TSL – What is it? Truly Seamless (TSL) Traditional TSL can solve the issues - end products with seams or inconsistent patterns 17
Slide 18: TSL – Benefits
TSL – Benefits Minimized disturbance Less limitations on to production specification Traditional Truly Seamless (TSL) Customers K Laser • Production speed/capacity improves significantly • Higher yield rate • Higher yield rate • Higher production rate • Cost-saving for Holographic Film by • Lower in
Slide 19: Strategy Focus
Strategy Focus Resource Gain Shares Optimization Truly Seamless Streamline operations products (TSL) Grow non-tobacco Rationalize global exposure operations 19
Slide 20: Our Goals
Our Goals We strive to enhance our No. 1 position in the world Increase ROE Improve efficiency & Expand gross expand margin in core operating Core revenue business margin in core CAGR superior business to the industry average 20
Slide 21: Income Statement (consolidated)
Income Statement (consolidated) NT$ Million 1Q18 1Q17 YoY (%) 2017 2016 YoY (%) Sales Revenue 1,255 1,059 18.5 5,218 5,080 2.7 Gross Profit 276 263 4.8 1,284 1,281 0.2 Operating Profit 56 65 (14.3) 413 473 (12.8) Income before Tax 18 4 379.2 275 343 (19.8) Net Income to Parent 13 7 98.8 155 215 (28.
Slide 22: Balance Sheet (consolidated)
Balance Sheet (consolidated) NT$ Million 1Q18 1Q17 YoY (%) 4Q17 QoQ (%) TOTAL ASSETS 6,939 6,489 6.9 6,834 1.5 Cash 1,552 1,211 28.2 1,472 5.4 NR & AR 1,506 1,569 (4.0) 1,667 (9.7) Inventory 912 877 4.0 865 5.4 Fixed Asset 1,291 1,281 0.8 1,292 (0.1) TOTAL LIABILITIES 3,151 3,363 (6.3) 3,121 1.0 Ban
Slide 23: Dividend
Dividend 2015 2016 2017 Net Income (NT$ mn) 164 215 155 Cash Dividend (NT$ mn) 66 109 91 Dividend per Share (NT$) 0.50 0.815 0.56 Payout Ratio (%) 40% 51% 59% Cash Yield (%)* 3.6%* 5.2%* 3.7%** *Cash yield is based on K Laser’s closing share price on the day before ex-dividend day (November 3, 2015
Slide 24: Thank You
THANK YOU 2 K LASER