昆盈企業之營運展望
KYE Eric Lai
2009 Q3 KYE Review and Perspective 2009 Q3
Kevin Kao / Finance VP
Oct. 22, 2009
About Us
Headquarter : Taipei, Taiwan, R.O.C. Founded : November 3, 1983 Capital (as of Sep. 30, 2009)NT$2,903 Million Major shareholder (as of Sep. 30, 2009): Jwo & Chen's Family(25%-30%)
QFII(11.2%); Local fund(3.63%) ; Employee(4%-5%) Revenue : US$ 220 Million (2009 Q1-Q3, down 26%) Employees : 3,535 (Taipei:365, Marketing subsidiary:70, Factory:3,100) Core technology Input Device : Mice, K/B, Tablet (Digitizer)
Image: DV, DSC, Web Cam, Cam Module, Laser Bar Code Printer
Acoustic products: Speakers, Headsets
Sales Office : US, Germany, UK, HK, China
Marketing Rep. America: Brazil, Argentina, Mexico, Chile, Colombia EMEA: Poland, Ukraine, Czech, Iran, Turkey , Hungary,
Asia-Pacific: India, China, Vietnam, Indonesia
PR Consultant
America: U.S. EMEA: Italy, Poland, Czech, Kazakhstan, Turkey, Iran
Germany, France, UK Asia-Pacific: Vietnam, India, Indonesia
Factory : Dong Guan Guang Dong , China
-1-
Financial Summary
9Top line jumps significantly month by month, i.e. Sep. revenues rose +14.3% mom posting the highest amount this year and delivering +23.8% QOQ growth in Q3 2009. Momentum will extend towards Q4.
9Lower GPR (18.9%) in Q3 09 due to weak USD, relatively insufficient capacity utilization and higher sales discount to customer.
9Net Income in Q3 09 recorded NT$221mn, or EPS$0.78, surged +85.7% qoq outperformed revenues increase.
9Genius accounted 56% to 58% for sales and 80%+ for profits YTD. 9Sales from Latin America, Middle East & Asia turn positive growth in Q3. 9Genius Mice, Earphones & Headsets, DV/DSC and Card Readers
contribute growth momentum and keep improving signal among products in Q3. 9Cash flows generation capability remains solid despite outflows for dividends and working capital need in peak season.
9Recovery demands from emerging markets, new products and new customers will be the key of performance going forward.
-2-
Key Financials-Consolidated P/L
Item Net Sales COGS Gross Profit Operating Expense Operating Income Non-Operating Income before Tax EPS(Pretax )* Net Income EPS(After-tax)*
2009 Q1-Q3 7,122 100% 5,700 80.0% 1,423 20.0%
993 13.9% 429 6.0% 113 1.6% 542 7.6% 1.91 504 7.1% 1.77
2008 Q1-Q3V
in millions of NT$
YOY%
2009Q3
YOY% QOQ%
9,780 100% (27.2%) 2,932 100% (26.5%) 23.8%
7,702 78.8% (26.0%) 2,078 21.2% (31.5%)
2,377 81.1% (23.4%) 24.4% 555 18.9% (37.3%) 21.0%
1,165 11.9% (14.7%)
368 12.6% (19.9%) 10.4%
913 9.3% (53.0%) 33 0.4% 240.2%
187 6.3% (56.1%) 49.2% 52 1.8% 48.0% 467.9%
946 9.7% (42.7%)
239 8.1% (48.1%) 78.0%
3.29
0.84
777 8.0% (35.2%) 2.70
221 7.5% (42.8%) 85.7% 0.78
*Note1EPS are based on the weighted average shares outstanding of 284,398K and 287,469K shares in Q3 2009 and 2008.
-3-
Key Financials
Consolidated B/S
YoY Comparison1
2009 Q3
Cash & Equiv. 1,817 25.1%
Financial Assets
Accounts Receivable
Inventories
206 1,895 1,769
2.8% 26.2% 24.4%
Bank Loan
0
0.0%
Accounts Payable
Equity
1,840 4,580
25.4% 63.3%
Total Assets 7,237 100%
2009 Q2
2,027 29.1%
327
4.7%
1,474 1,515 100 1,307 4,338 6,960
21.2% 21.8% 1.4% 18.8% 62.3% 100%
in millions of NT$
2008 Q4
662 10.6%
230
3.7%
1,922 1,640
0 1,126 4,114 6,247
30.8% 26.3%
0% 18.0% 65.9% 100%
-4-
Financial Ratio Summary
9Adequate liquidity and Excellent operating efficiency with strong cash generating ability
9Strong financial structure with keep reducing liability ratio
9Proven track records in profitability(09's ROE maintain at above 20%)
9Constant dividend policy High payout ratio(60% to 80%) with majority of cash makes an very attractive yield as in past 3 years.
Item
Financial Ratio/Year
06
07
08
09 Q3
Capital Structure Liabilities to Assets ratio(%)
40.3 37.9 34.1 33.4
Liquidity
Current ratio(%)
207.3 220.8 229.8 190.3
Analysis Operating performance Profitability
Quick ratio(%) Average collection days Global inventory turnover days ROE(%) 2009 Q1-Q3
164.9 52.0 44.0 18.2
160.0 57.0 50.0 25.5
141.4 65.0 59.0 20.6
169.2 64.0 74.0 11.6
EPS(nt$/share) 2009 Q1-Q3
3.51 4.80 3.03 1.77
Dividend
Stock Dividends(nt$/share)
0.42 1.18 1.40 0.99
Cash Dividends(nt$/share) Capital Reduction(nt$/share) Dividend yield(%)
2.09 2.49 3.51 1.317
-
1.00 1.00
-
5.6
6.7 21.3
5.0
-5-
Business Operation Summary
BU
Turnover
A/R Turnover (days)
Genius
Inventory Turnover (days) A/P Turnover (days)
Cash Conversion Days
A/R Turnover (days)
Inventory Turnover (days)
ODM/EMS
A/P Turnover (days)
Cash Conversion Days
A/R Turnover (days)
KYE
Inventory Turnover (days) A/P Turnover (days)
Cash Conversion Days
05 45.0 41.0 64.0 22.0 57.0 40.0 64.0 33.0 50.0 40.0 64.0 26.0
06 49.0 41.0 73.0 17.0 58.0 48.0 78.0 28.0 52.0 44.0 75.0 21.0
07 56.0 49.0 76.0 29.0 61.0 51.0 76.0 36.0 57.0 50.0 76.0 31.0
08 65.0 57.0 79.0 43.0 64.0 60.0 79.0 45.0 65.0 59.0 79.0 45.0
09 Q3 66.0 69.0 82.0 53.0 62.0 79.0 82.0 59.0 64.0 74.0 82.0 56.0
-6-
Business Model
OBM/ODM Mix Portfolio Branding Contributed 56% - 58% in 09 Q3 & Q1-Q3
293
51%
49%
360 329
54% 54%
46% 46%
395
56%
44%
415
61% 39%
2003
2004
2005
2006
2007
-7-
400
59%
41%
OBM
ODM / EMS
(in millions of US$ ) in Consolidated basis
2008
Regional Sales Allocation- 2009 Q3
Russia & CIS & E.E.
W.E & S.E. US Latin America M.E.A Total Sales
% of Sales
14.6% 17.8% 9.7% 23.6% 34.3% 100.0%
yoy %
-54.9% -42.1% -57.9% 12.7% 18.5% -26.5%
2009 Q3
(Total Revenue : NT$ 2.93 BN)
M.E.A, 34.3%
Russia & CIS & E.E.,
14.6%
W.E & S.E 17.8%
Latin America,
23.6%
US, 9.7%
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Regional Sales Allocation- 2009 Q1-Q3
2009 Q1-Q3
(Total Revenue : NT$ 7.12 BN)
% of Sales
Russia & CIS & E.E.
13.3%
W.E & S.E.
17.2%
US
12.9%
Latin America
22.5%
M.E.A
34.1%
Total Sales
100.0%
yoy %
-55.6% -37.7% -44.5%
-2.5% 1.0% -27.2%
M.E.A, 34.1%
Latin America,
22.5%
Russia & CIS & E.E.,
13.3% W.E & S.E 17.2%
US, 12.9%
-9-
OBM(Genius) Regional Allocation-09 Q3
% of Sales yoy %
Russia/ CIS / E.E. W.E & S.E.
25.3% -54.9% 17.1% -36.2%
US
1.3% 26.7%
Latin America
40.3% 12.7%
M.E.A
16.0% 1.1%
Total Sales
100.0% -25.3%
2009 Q3
(Total Revenue : NT$ 1.69 BN)
M.E.A, 16.0%
Russia & CIS & E.E., 25.3%
Latin America,
40.3%
US, 1.3%
W.E & S.E., 17.1%
-10-
OBM(Genius) Regional Allocation-09 Q1-Q3
% of Sales yoy %
Russia/ CIS / E.E. W.E & S.E. US Latin America M.E.A
22.7% 19.2% 1.6% 38.1% 18.4%
-56.1% -33.2%
1.1% -4.8% -9.9%
Total Sales
100.0% -29.1%
2009 Q1-Q3
(Total Revenue : NT$ 4.13 BN)
M.E.A, 18.4%
Russia & CIS & E.E., 22.7%
Latin America,
38.1%
US, 1.6%
W.E & S.E., 19.2%
-11-
Business Model
KYE Production
Product Mouse K/B DV/DSC Webcam Speaker Headset Gaming/Handheld Game Devices Card Reader Digitizer (Tablet) Barcode Label Printer Robotics
GENIUS
ODM/OEM
Self-manufacturing Self-design & Out-sourcing
Self-manufacturing Self-design
Out-sourcing / Self-manufacturing Self-manufacturing
Self-manufacturing
Self-manufacturing
Self-design & Out-sourcing
Self-design & Out-sourcing
Out-sourcing / Self-manufacturing Self-manufacturing
Self-manufacturing Out-sourcing / Self-manufacturing
Self-manufacturing Self-manufacturing
-12-
2009 Q3 Product Portfolio
14.6%
6.8%
5.4%
32.8%
24.7%
2.0%
13.7%
-13-
2009 Q1-Q3 Product Portfolio
15.8%
6.9%
5.9%
34.9%
21.6%
2.1%
12.9%
-14-
2009 Q3 Genius Product Portfolio
24.7%
7.2%
28.9%
13.8%
2.4%
-15-
23.0%
2009 Q1-Q3 Genius Product Portfolio
26.1%
7.4%
14.9%
2.4%
-16-
27.5% 21.8%
2009 Q3 Product Summary
PRODUCTS Mouse
Genius ODM KB Speaker Headset DV/DSC Webcam Gaming Carder Reader
2009 Q3 Units yoy
-19.6% 2.8% -37.0% -19.1% -25.2% 13.0% 601.4% 33.3% -29.0% 8.3%
2009 Q3 Revenues yoy
-31.4% 16.7% -55.4% -30.9% -46.3% 3.3% 461.9% -33.0% -44.1% 15.4%
2009 Q1-Q3 Units yoy
-29.7% -11.5% -44.1% -31.3% -25.6% 14.1% 317.1% 22.0% -38.8% -9.1%
2009 Q1-Q3 Revenues yoy
-36.1% -6.8% -51.3% -35.4% -37.0% 20.3% 217.0% -11.4% -45.4% 0.3%
-17-
Growth Engines
A. NB/Net Books
C. Acoustic Devices
Ring MicePen Mice OTC MiceWebcam NB Cam Module Digitizer
iPod/MP3/5.1CH speakers MSN/Skype Headset & Headphones Earphone for cellular phone
B. Card Reader
External for Memory Card Mobil Phone bundle Build-in Cards Reader for
Printer or Desktop PC
D. New Projects
DV/DSC/Peephole Cam Bar Code Label Printer Lab Equipment/Spectrometers Handheld Gaming Devices
-18-
Growth Engines
Genius Europe
- Spain - Recovering Emerging Europe
America
- Brazil - Mexico - Chile
Asia Pacific
- China - Indonesia - Vietnam - Turkey - Malaysia - UAE
ODM / OEM A. Customer
- H company - Double A companies - F company - M company
B. Products - Card Reader - OTC Mice/K+M - DV/DSC - Webcam/Peephole Cam - Handheld Gaming Devices - Bar Code Label Printer
-19-
Genius Perspective
Genius Asset Value
Brand Awareness (38.3 million Genius)
Brand Value (2009 US$ 69 million )
Brand Image (
)
Brand Loyalty
Brand Relationship
(a) Physical Channels * NCS (National Chain Store) * Hypermarket * Systems Bundled
(b) Virtual Channels * e-shopping
* 3C Store * Mobile Phone Chain Store * Public Sector Projects
* TV shopping
-20-
ODM/OEM Perspective
Valuable Customers
* H.P., Acer, ASUS, Microsoft, Philips & Sony
Profit-orientation and the Perfect Product Portfolio
* ODM & OEM
Keep the leadership in core technologies
* Pointing Device Technology * Image Technology * Storage Technology * Wireless Technology
A approved and certified manufacturer
* H.P., Acer, Microsoft & Philips * ISO9001, ISO14001 & QCO80000
-21-
Production Capability
Factories
: III
Production Space : 24,900
Yearly Capacity : 30 million pcs
Yearly output value: 230 million USD
Factories
: V
Production Space : 45,000
Yearly Capacity : 50 million pcs
Yearly output value: 450 million USD
Products Output Capacity Mice/K+M5mn/m DV/DSC6XLines 450k/m now Card Reader1mn/m now Digitizer50k/m now
12XLines 800k/m Dec. 2009 2mn/m Sep. 2010 100k/m June 2010
-22-
Near Term Financial Guidance
Recovery of revenues from emerging markets, new products and new business to generate growing revenues and profits quarter by quarter in next year.
Strong cash inflow from operation and net cash balance to fulfill business demand and dividends payout.
Stable business cycle at around 110 to 115 days and cash conversion at between 35 to 40 days.
Solid financial position, liability ratio below 35%. Strategic Alliance to create more business opportunity through
shares investment on supply chains and customers Challenges and risksEconomic Rebound or Recovery,
sustainability of increasing demand, FX rate of USD v.s. NT stable currencies in emerging Europe.
-23-
KYE Advantages
· One of Taiwan's top 20 Global Brands in 5 consecutive years since 05
· Red dot, IF, G-Mark & CES Design Award Winner · Owner of 945 patents around the world as of Sep. 2009 · Ranked 66,48 for applied/approved patents in Taiwan for 2008 · The world's leading and Taiwan's best PC peripheral brand · The world's leading ODM/OEM for card readers · Professional ODM/OEM service and 1ST-tier IT Corps' partner
-24-
Brand Awards
2009 Taiwan Top 20 Global Brand
Financial result Brand position Brand awareness Brand Net Value
-25-
Design Awards
OOnneeooffTToopp2200 TTaaiwiwaannBBrraanndd
0055--0099
Japan G-Mark Design Award
Optical Touch Controller Laser Mouse
Keyboard& Mouse Combination
Web Cam
- 26 -
Digital Note
Speaker
Thank You!
Acrobat Distiller 7.0.5 (Windows) Eric Lai