Taiwan Sakura Corporation · TWSE:9911
Taiwan Sakura — FY2019 Earnings Presentation
36 slides from Taiwan Sakura's earnings presentation, May 20, 2020
Slide 1: SAKURA GROUP
goons ites SAKURA GROUP
Slide 2: Company Profile
Company Profile Head Office Established in 1978 Date of Listing：1992/07/16 Chairman ：Chang, Yung-Chieh Paid-in Capital：NTD 2.21 billion Production Base ： Taiwan - Daya main div.／Daya 2nd div.／Shenkang ／Wufeng China - Kunshan, Jiangsu／Shunde, Guangdong Employees: 1,080 (Taiwan) / 3,200 (C
Slide 3: Investment Structure
Investment Structure Taiwan Sakura Capital： http://www.sakura.com.tw/ NTD 2,211mn 43.19% 100% 100% Shareholding Ratio: 44.39% Capital： Puda Topax Sakura B.V.I. USD 17.15mn http://www.puda.com.tw/ http://www.topax.com.tw/ Capital： Capital： NTD 171mn NTD 217mn 45% 100% Capital： Sakura Cayman USD 5.85m
Slide 4: SAKURA Milestones
SAKURA Milestones 1978 “ SAKURA ” brand established 1980 “Free oil filters with a door-to- door delivery” as the free permanent service 1987 “Free examination of water heater” as the free permanent service 1994 “SAKURA (China) Bath and Kitchen Co., Ltd” officially began the production and sales acti
Slide 5: Business Concept
Business Concept Meet the needs of local consumers Innovation NPS applied compresensively DFSS/DFMEA Quality Ser vice High-pressure leak test Ignition switch test SAKURA CARE 24/7 service hotline On-duty service all year Constant temperature and Withstand voltage test round moisture duration test 5
Slide 6: Core Mission
Core Mission A value enterprise and the maximum of the value for consumers and shareholders. ROE、Dividend yield Dividend Payout Strategy 25 5 EPS 18.8 19.6 4.06 20 17.7 4 Cash dividend per share 17.0 ROE 3.65 3.29 15 12.8 13.3 12.3 3 2.75 9.0 1.97 1.89 2.6 2.65 2.65 10 7.9 2 1.75 2.5 6.9 6.5 7.1 7.1
Slide 7: Brands & Products
Brands & Products Water Heater/ Kitchen Appliance Kitchen Solution House Deco Imported Kitchen Appliance Bathroom Solution 7
Slide 8: The Level of Brands
The Level of Brands Water Heater/ Kitchen Appliance Kitchen Solution House Deco Keep going up 8
Slide 9: Channel Structure_Water Heater/ Kitchen Appliance
Channel Structure_Water Heater/ Kitchen Appliance Distributor Brand store Taiwan Sakura Direct Dealer Regional Branches Regional Agents Sanitary materials Special dealer (kitchen solution、import department) (9) Kitchenware factory Store/Shop Land developer Distributor、 Kitchenware Store/Shop、 or con
Slide 10: Global Market Network
Global Market Network ODM/OEM Hong Kong Australia USA Brazil Dominican Republic OBM Hong Kong Myanmar Macau Philippine USA Mexico Canada Peru Vietnam 10
Slide 11: Sales Breakdown of 2019
Sales Breakdown of 2019 Total Sales Revenue: NT$ 6.3 billion Sales Revenue of WH & KA: NT$ 3.82 billion Topax Property Import 15% developer 0.26 billion Kitchenware 6% Export Brand factory Distributor、 0.53 billion 4% 10% Sanitary 8% materials Brand store Sakura 33% 12% 85% Channel 20% Others Kitche
Slide 12: Sales Breakdown of 2019
Sales Breakdown of 2019 Total Sales Revenue: NT$ 6.3 billion Sales Revenue of KS: NT$ 1.59 billion Import 0.26 billion Export 0.53 billion 4% 8% Brand store 32% Land developer or Water heater & Channel Construction companie Kitchen Solution Kitchen appliance 1.59 billion 3.82 billion 68% 25% 61% 12
Slide 13: Water Heater & Kitchen Appliance
Water Heater & Kitchen Appliance Taiwan overall market Market share in Taiwan (1000 units) S+T Sakura Topax 1,600 46.7% 50% 42.2% 42.5% 42.1% 43.8% 42.7% 43.9% 1,500 40% 38.9% 36.8% 36.6% 36.0% 37.1% 36.3% 37.1% 30% 1,400 20% 1,300 7.9% 10% 5.3% 5.9% 6.1% 6.6% 6.4% 6.8% 8.6 million households in Tai
Slide 14: Innovative Products of Taiwan Sakura
Innovative Products of Taiwan Sakura 10L 16L RF Water Heater Intelligent Turbo Boost NTD 7,500 Water Heater NTD 23,900 加倍水量 GMR : 25%-30% GMR : 40%-50% 加倍舒暢 Gas Stove Intelligent Built-in Hob NTD 4,700 with Double Vertex GMR : 30%-35% Flames NTD 18,300 GMR : 35%-45% Slope-side Range 3D Ring Suction
Slide 15: Water Heater
Water Heater Overall market Market share (S+T) (1000 units) RF+FE Total FY2013 FY2019 509 516 491 497 498 504 490 488 509 508 467 447 (78%) 398 377 Others S+T Others RF 343 339 (63%) S+T 322 320 43% (Traditional) 293 288 292 278 47% 53% (53%) 57% 251 237 RF 55% 217 230 215 209 FE 59% 197 201 178 176
Slide 16: Gas Stove
Gas Stove Overall market Market share (S+T) (1000 units) 468 500 454 451 457 453 455 FY2013 FY2019 423 425 402 385 378 400 354 Market：450,000~460,000 units per year 300 Used house S+T S+T transfer Others Others 40% 45% 200 55% 60% Building use Building license permit 100 2008 2009 2010 2011 2012 201
Slide 17: Rang Hood
Rang Hood Overall market Market share (S+T) (1000 units) 500 Market：360,000~370,000 FY2013 FY2019 Used house units per year transfer 370 369 373 373 366 400 337 352 312 312 311 307 S+T S+T 300 300 36% Others 40% Others 64% 60% 200 Building use Building license permit 100 2008 2009 2010 2011 2012 201
Slide 18: Kitchen Solution
Kitchen Solution Overall Market Steady growth in Increasing benefits of about 160,000 sets Sales of Land developer the brand stores Overall market (1000 sets) Sales of Property developer (NT$ mn) Sales of brand stores (NT$ mn) Residential Use Permit (1000 house) Brand stores 177 175 177 172 97 95 98
Slide 19: Development Plan_Production Optimization
Development Plan_Production Optimization Shenkang plant Daya plant Wufeng plant Range hood (Spraying) Water heater & Gas stove Kitchen solution Lack of space / It’s difficult to install automatic Inefficient flow of processing production line with the present space. New Factory－Production line optim
Slide 20: Development Plan_Water Purifier
Development Plan_Water Purifier Water Purifier Market (Machine + Filter) NT$ 10 bn Agent specialized Over Hundred Brands >300stores Top barnd share <20% Machine + Filter Sales Amont 2019 2025 Goal NT$80mn → NT$ 1bn 20
Slide 21: New Water Purifier product
New Water Purifier product 21
Slide 22: Development Plan_House Deco
Development Plan_House Deco From Kitchen Solution Design Guidelines for SAKURA HOME construction cases different life styles • Date of Registration：2019/11/15 • Paid-in Capital：NTD 90 million Room type Database • The first flagship store： - Trial run in 2020/5 - Officially opened in 2020/6~7 Core Co
Slide 23: Sakura Home Whole House Customization
Sakura Home Whole House Customization Lobby Living Room Dining Room Kitchen Master Bedroom Walk-in Closet Bedroom Children's Room Elder's Room Study Room Balcony Others 23
Slide 24: Development Plan_Vietnam Market
Development Plan_Vietnam Market Market share of Gas stove Modern channel Property developer (H.C.M/Hanoi/Da Nang) 46% 39% 8% 6% Rinnai Sakura Paloma Others >200 brands 2018/11 Representative office 2020 H1 Investment negotiation 2019/12 Market business model decision 24
Slide 25: Development Plan_SAKURA COUNTER
Development Plan_SAKURA COUNTER SAKURA Department Store Counter 2020~2021 expand 6 counters Brand upgrade Customer service The first SAKURA department store counter has opened in One-stop Shin Kong Mitsukoshi department store in March 2020. shopping Integrate the brands of Electrolux, Svago, and Sak
Slide 26: Key Financial Indicators
Sakura Group Key Financial Indicators Net Revenue Net Income (NTD mn) EPS YoY+5% 6,299 5,986 5,601 5,644 5,149 4,852 4,485 4,074 4.06 3.65 3.29 2.75 1.97 1.89 1.75 1.02 YoY+11% 720 800 889 539 517 701 478 276 2012 2013 2014 2015 2016 2017 2018 2019 26
Slide 27: Sakura Group Key Financial Indicators
Sakura Group Key Financial Indicators 2012 2013 2014 2015 2016 2017 2018 2019 (NTD mn) Amount % Amount % Amount % Amount % Amount % Amount % Amount % Amount % Net Revenue 4,074 100.0% 4,485 100.0% 4,852 100.0% 5,149 100.0% 5,601 100.0% 5,644 100.0% 5,986 100.0% 6,299 100.0% COGS 2,860 70.2% 3,114 69
Slide 28: Business Prospection
Business Prospection The market share of kitchen appliances keeps growing while the 1 average retail price and margin are going up by selling more high- end products. Kitchen Solution is expected to keep growing the market share 2 for new houses and improve the operation efficiency of brand stores.
Slide 29: Sakura China
EE] SAKURA Sakura China AKU 7 SAKURA
Slide 30: Kitchen Appliance in China Market
Kitchen Appliance in China Market Water heater Retail Sales YoY Range hood Retail Sales YoY Gas stove Retail Sales YoY (RMB bn) (RMB bn) (RMB bn) 11.9% 12.3% 12.7% 9.8% 11.7% 9.7% 0.5% -3.5% -2.2% -8.8% -7.9% -4.2% -12.0% -7.1% -9.0% 43.3 66.8 67.2 64.8 38.4 39.9 38.2 26.4 60.9 59.1 23.6 24.5 24.0 3
Slide 31: Sakura China Overall Business Strategies
Sakura China Overall Business Strategies Continue to focus on the management in regional and the 1 niche in the replacement markets. E-commerce deployments / off-line distributor developments 2 in 3-4 tier cities. 3 Managing Fixed costs / Enforcing Inventory management. 31
Slide 32: Main product_Intelligent gas water heaters
Main product_Intelligent gas water heaters Water heater market share Gas water heater is 2017 2018 2019 the mainstream. 7% Sakura China - water heater sales 59% 54% 52% 66% 43% 45% 62% Gas 34% 55% 43% 46% 3% 3% 7% Gas(>14L) 45% Gas Electric Others 38% 34% Electric 17% Gas water heater market share P
Slide 33: Channel Structure
Channel Structure Sales Breakdown by Channel, 2019 Sakura China Others Agent 5.0% 7.0% Online Offline Main growing Retailer power 36.0% EC 27.0% E-commerce Regional Agents Headquarters Key (TMALL、JD、Suning、 PDD) (2) 、Branches(28) Account 25.0% Key Property KA channel： Retailer： Regional Agents Retai
Slide 34: E-commerce
E-commerce Sakura China-Sales amount of EC YoY+47% (RMB mn) 260 177 109 132 87 50 20 2013 2014 2015 2016 2017 2018 2019 EC main strategy Sales Breakdown by Customer, 2019 Signing up new area agents The niche of replacement market in the 2020 growth target: 18% Others cities of tier 1 & 2 26% TMA
Slide 35: Sakura China - Performance and Milestone
Sakura China - Performance and Milestone (RMB mn) Net Revenue Net Income Withdrew from 2,000KM, and adjusted Channel rearrangement & Q4：Stock Q2：Price the operation and new product development Clearance Adjustment US-China products. Trade War 1,439 1,430 1,458 1,416 1,500 1,359 1,312 1,292 1,161 1,0
Slide 36: THANK YOU!
36 THANK YOU!