GMI 4Q18 Earnings Release

Mar 28th, 2018

I . 公司本體部分 I I . 代理產品部分

Safe Harbor Statements

GMI’s forward-looking statements, which may include statements regarding its results of operations, financial condition or

business prospects, are subject to significant risks and uncertainties and are based on GMI’s current expectations.

Actual results may differ materially from those expressed or implied in these forward-looking statements for a variety of

reasons, including, among other things: the cyclical nature of our industry; our dependence on introducing new products

on a timely basis; our dependence on growth in the demand for our products; our ability to compete effectively; our

dependence on key personnel; general economic and political conditions; possible disruptions in commercial activities

caused by natural and human-induced disasters, including terrorist activity and armed conflict; and fluctuations in foreign

currency exchange rates.

In addition, any financial information contained here within is presented in conformity with International Financial

Reporting Standards (IFRSs).

Except as required by law, our release of financial forecasts and forward-looking statements at any particular time does

not create any duty of disclosure, and we expressly disclaim any obligation to publicly update or revise any forecasts or

forward-looking statements, whether as a result of new information, future events or otherwise.

Agenda

Company Brief

Financial Update

Business Outlook

Q&A

Established in 1995

Headquarter in Taipei

10 service locations are located China 、Hong Kong、Taiwan

Capital Amount: NTD$1.1 Billion

Listed at OTC in 2005 Listed at TWSE in 2010 #3312

Over 180 employees

Company Overview

2,239,512

2,705,171

2,861,558

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

4Q17 3Q18 4Q18

8,559,738

9,812,498

7,500,000

8,000,000

8,500,000

9,000,000

9,500,000

10,000,000

2017 2018

YoY 27.8%

QoQ 5.8%

YoY 14.6%

Financial-Consolidated operating income (In NT$ Thousands)

YoY -0.15pt

QoQ -0.34pt

YoY -0.12pt

Financial-Consolidated operating gross profit margin

YoY -0.09

QoQ -0.10

YoY 3.5

Financial-Consolidated earnings per share (In NT$)

-2.22

1.28

-2.50

-2.00

-1.50

-1.00

-0.50

0.00

0.50

1.00

1.50

2018

2017

Financial-Consolidated income statement (Quarter)

(In NT$ Thousands)

Items 4Q18 3Q18 4Q17 Q-Q Y-Y

Net Sales 2,861,558 2,705,171 2,239,512 5.78% 27.78%

Operating costs 2,743,303 2,584,349 2,143,758

Gross profit 118,255 120,822 95,754 (2.12%) 23.50%

Selling expenses 25,856 26,453 58,652

Administration expenses 55,392 48,750 19,656

R&D expenses 4,171 4,413 4,868

Expected credit gain 0 (4,398) 0

Operating expenses 85,419 75,218 83,176

Operating income 32,836 45,604 12,578 (28.00%) 161.06%

Net non-operating income and expenses (451) 2,214 2,416

Net income before income tax 32,385 47,818 14,994

Income tax expense(income) 7,873 12,544 (15,581)

Net income 24,512 35,274 30,575 (30.51%) (19.83%)

EPS attributable to the parent(NT$) 0.22 0.32 0.31

Financial-Consolidated income statement - Year

(In NT$ Thousands)

Items 2018 2017 Y-Y

Net Sales 9,812,498 8,559,738 14.64%

Operating costs 9,368,342 8,161,377

Gross profit 444,156 398,361 11.50%

Selling expenses 144,918 259,754

Administration expenses 150,229 73,700

R&D expenses 18,694 20,380

Expected credit gain (14,591) -

Operating expenses 299,250 353,834

Operating income 144,906 44,527 225.43%

Net non-operating income and expenses (3,209) (282,256)

Net income before income tax 141,697 (237,729)

Income tax expense(income) 3,236 (17,773)

Net income 138,461 (219,956) 162.95%

EPS attributable to the parent(NT$) 1.28 (2.22)

Financial-Consolidated balance sheet

(In NT$ Thousands)

Items 4Q18 3Q18 4Q17 Q-Q Y-Y

Cash and cash equivalents 466,194 368,534 324,892 26.50% 43.49%

Accounts receivable 2,465,796 2,351,738 1,951,633 4.85% 26.35%

Inventories 545,543 635,035 553,826

Other current assets 287,839 317,482 373,136

Other non-current assets 43,267 38,746 42,258

Total assets 3,808,639 3,711,535 3,245,745

Short-term loans 652,927 772,830 734,099 (15.51%) (11.06%)

Accounts payable 1,671,228 1,480,752 1,214,510 12.86% 37.61%

Other current liabilities 128,582 119,656 129,695

Total non-current liabilities 22,006 32,292 62,292

Total equity 1,333,896 1,306,005 1,105,149

Application Field

Consumer Electronic

TV│Tablet │BT Earphone

IoT

Smart Wear│Drone│Smart Light

Automotive Electronics

Car Entertainment │ Car Safety

Communication/Networking

Smart Home│Telecomm and Networking Equipment

Computer Peripherals

Server │ NB │ MB │Industrial PC

Industrial electronics

Medical Equipment │ Security System

Business Outlook │Telecommunication Operators market

OTT Box

WIFI 802.11N 802.11AC

PON

Platform

802.11AC WIFI Chip

GMI 2018 Operator Market

2018 cumulative revenue YOY growth 40%

Mainly growing into the Chinese operator

market

The main products are wireless network cards,

the main control chip

Business Outlook │ TWS Headsets Market

Main chip

Two main chips are required for each pair of TWS

The main chip accounts for 30~40% of the cost of the TWS headset

2017 2H established independent sales and engineering team

Mass production of 20,000 in April 2018

Sales exceeded one million in December 2018

January 2019 sales exceeded 1.6 million

65

100

150

0

20

40

60

80

100

120

140

160

2018Y 2019Y(F) 2020Y(F)

TWS headsets Shipment (Units/Millions)

Business Outlook │Internet Of Things

WIFI/ BT Transfer Module

Wi-Fi Transfer Module

Bluetooth Transfer Module

Smart Home Wi-Fi & BT SOC Audio Processing Audio Amp MEMS-MIC

Smart speaker periphery

Smart light bulb

Smart plug

Electronic door lock, doorbell

Power saving IP Cam

Business Outlook │ New product-lines development

Gas sensor

Low power consumption, small size,

multi-gas identification

Formaldehyde, alcohol, ammonia,

carbon monoxide, hydrogen sulfide,

methane, TVOC, etc.

Product use: air filter, refrigerator,

water heater, gas stove, etc.

lithium polymer battery

Three lithium batteries are required for

each pair of TWS headphones

Lithium battery accounts for 12~15% of

the cost of TWS headphones

MEMS MIC 2~4 Gueymais are required for each

pair of TWS headphones

Guimai accounts for 3~6% cost of TWS

headsets

Antenna

Market : 5G, Internet of Things, Industry

4.0, Internet of Vehicles, Smart Home

Strategically synergy

Q & A