Investor Conference-20120518 new(by Austin) - 上傳版. 100% WCDMA operators have ... Utilizing mix of Macrocell and small cell ... Increasing system throughput. 3

Think of Frequency, Think of TXC |

May 23, 2012

Think of Frequency, Think of TXC | 1

FINANCIAL RESULTS SALES & MARKETING PRODUCTS’ DEVELOPMENTBUSINESS HIGHLIGHTQ&A



1,394

1,824

2,217 2,292 2,113

2,338 2,510

2,689

2,322 2,476 2,495

2,605 2,394

‐22.69%

30.88%

21.55%

3.39%

‐7.84%

10.69%

7.33% 7.14%

‐13.65%

6.63%0.77%

4.45%

‐8.10%

‐30%

‐20%

‐10%

0%

10%

20%

30%

40%

0

500

1,000

1,500

2,000

2,500

3,000

09.Q1 09.Q2 09.Q3 09.Q4 10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1

Quarterly Revenue QoQ Revenue Growth

3

Unit: $NT in Million



273

422

576 633

532

629 696

679

576 609 630

586

522

19.61%

23.15%

26.00%27.59%

25.16%

26.91% 27.75% 25.20%24.63%24.69% 25.25%

22.50%21.80%

0%

5%

10%

15%

20%

25%

30%

0

100

200

300

400

500

600

700

800

09.Q1 09.Q2 09.Q3 09.Q4 10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1

Quarterly Gross Profit Gross Margin


69

170

260 283

213

331 361

285 237 248

305

260 199 4.97%

9.31%

11.74%12.34%

10.08%

14.15% 14.37%

10.61%

10.13% 10.02%

12.23%

9.98%

8.31%

0%

2%

4%

6%

8%

10%

12%

14%

16%

0

50

100

150

200

250

300

350

400

450

09.Q1 09.Q2 09.Q3 09.Q4 10.Q1 10.Q2 10.Q3 10.Q4 11.Q1 11.Q2 11.Q3 11.Q4 12.Q1

Quarterly Net Profit Net Margin



Item 11.Q3 11.Q4 12.Q1

Current Assets $ 6,712 $ 5,727 $ 5,785

Cash $ 2,237 $ 1,283 $ 1,445

Notes & Account receivables $ 2,997 $ 3,134 $ 2,845

Inventories $ 1,312 $ 1,160 $ 1,318

Fixed assets $ 5,530 $ 5,690 $ 5,610

Total assets $ 12,731 $ 11,943 $ 11,866

Current liabilities $ 3,467 $ 2,623 $ 3,297

Notes & Account payables $ 1,540 $ 1,271 $ 1,279

Long‐term liabilities $ 2,291 $ 2,088 $ 1,208

Total liabilities $ 5,816 $ 4,783 $ 4,585Shareholders' equity $ 6,914 $ 7,160 $ 7,281

Debt ratio 45.68% 40.05% 38.64%

Current Ratio 193.60% 218.34% 175.46%

Quick Ratio 150.97% 168.39% 130.12%

Net Value Per Share $ 22.88 $ 23.69 $ 24.09

(Unit: $NT in Million)


Amounts Notes Amounts NotesPing‐Cheng Factory 1,058 a. TCXO/AOM*5

b. Sapphire Equipment

c. RD Equipment

600 a. TCXO/AOM*5(Back‐end of line)b. Sapphire Euipment

NGB Factory 250 Tuning Fork*3

Miniature X'tal*2250 Miniature X'tal*5

Total 1,308 850

CKG Factory 156 Factories & Equipments 348 Factories & Equipments

Mass Production

(2012/2013)

2011 2012(f)

Factories


c. RD Euipment


• Compensation payable to directors and supervisors– 2%(2011)

• Employee Bonus– 12%(2011)

2005 2006 2007 2008 2009 2010 2011

Earning Per Share 2.73 4.13 4.88 3.56 2.75 4.06 3.48

Cash Dividend Per Share 0.99 1.94 1.98 2.00 2.00 2.50 2.2

Stock Dividend Per Share 0.59 0.97 0.99 0.50 0.20 0.20 0

Yield(%) 1.95% 3.20% 3.63% 6.25% 3.84% 4.47% 5.05%



8.46%

‐4.94%

‐14.39%

20.37%

1.37%0.80%

19.00%16.00%

8.00%

25.16%

8.64%

‐20.00%

‐15.00%

‐10.00%

‐5.00%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

2007 2008 2009 2010 2011 2012

WW FCP Market TXC

10

Resource: CS&A


Worldwide Revenue of the Top Crystal and Oscillator Suppliers (Unit: Millions of Dollars)

Resource: CS&A


Resource: CS&A


KHz Xtal20%

MHz Xtal34%XO

13%

TCXO21%

VCXO6.38%

OCXO5.06%

KHz Xtal38%

MHz Xtal51%

XO5%

TCXO6%

VCXO0.5%

OCXO0.02%

13

Resource: CS&A


KHz X'tal8%

MHz X'tal62%

Others8%

TCXO8%

VCXO1%

CXO13%

KHz X'tal4%

MHz X'tal58%

Others9%

TCXO16%

VCXO1% CXO

12%

14


PC20%

MOBILE30%

NETWORKING26%

CONSUMER9%

AUTOMOTIVE2% Others

11%

SAPPHIRE2%

PC25%

MOBILE28%

NETWORKING24%

CONSUMER8%

AUTOMOTIVE2%

Others13%

SAPPHIRE0.1%

15


T.A.M 2011: 1,554M units

2012(F): 1,681M units

660M units2012 YoY 33%

1,021M units

2011 Global mobile phone major players and market share(2012 estimated growth rate: 6%)

2012 China TAM 250M units(f)Nokia (29.9%)HTC (12.8%)Motorola (12.7%)Apple (6.5%)Lenovo (3.2%)Huawei (2.6%)ZTE (1.8%)Coolpad (1.5%)Others (29%)

16


GSA Research (Jan 2012):1. 100% WCDMA operators have

launched HSPA (3.5G)2. HSPA+ (3.75G) is mainstream.3. 35 commercial LTE networks

launched (Europe, USA, Korea, Japan, HK).

4. Forecasts 119 commercial LTE networks by end 2012.

EAU ~1.5M units/Y

Major Players:Ericsson, Huawei, Samsung, NEC, NSN, ZTE, Alcatel Lucent ,…etc

Huawei, 14%

Ericsson, 21%

Nokia Siemens, 10%

Alcatel Lucent, 3%

ZTE, 5%

Samsung, 28%

NEC, 12%

Others/Not Determined, 7%

17


HetNet (Hetrogeneous Network)Utilizing mix of Macrocell and small cell (Picocell, Femtocell…), relay base stations...etc..Advantages:1. Reduce operators’ CAPEX and OPEX cost.2. Increasing system throughput.3. Improving user Uplink/Downlink data rate.TXC opportunities:1. Small cell: Stratum‐3 TCXO, VCXO.2. Macrocell: OCXO, VCXO.

Macrocells

Femtocells

18


Source: DIGITIMES Feb, 2012

2011 2012

Existing Customers



1.2*1.0 Crystal (Smallest in the world) 7050/5032 (High‐Speed HCSL Oscillator) 1.6*1.0 Tuning Fork(Smallest in the world) MOSFET (Power Management Unit) 7050/5032/3225 MEMS Oscillator

http://www.txccorp.com/tw/index.asp


Prod

uct P

erform

ance

Seam ‐40~125℃

2012 2013 2014 2015 2016

VCXO

MHz Crystal

XO/MO/SO

TCXO &VCTCXO

OCXO

XO 100~200MHz (Fundamental)Phase Jitter < 0.1ps

Glass ‐50~150℃ (Automotive)

32KHz ±5ppm, ‐40~85ºC (RTC)

100~800MHz (PLL)Phase Jitter <0.5ps

Seam ‐40~125℃ (Automotive)

±0.28/±0.14ppm ‐40~85ºC (Telecom)

10/13MHz (±10ppb, ‐10~75ºC)

38.88MHz(±200ppb, ‐30~70ºC)

±0.5ppm ‐40~85ºC (Automotive)

Glass ‐40~125℃ (Automotive)

XO 100~800MHz (PLL)Phase Jitter < 0.3ps

2520/2016 Seam (Mobile/GPS) 1612 Seam (Mobile/GPS)

XO CMOS ‐40~105℃ (Automotive)

100~200MHz (Fundamental)Phase Jitter <0.1ps

SO LVPECL/LVDS <50ppm

2016 TSX (Crystal + Thermistor)

Ultra Stability

Low Phase Noise

High Stability

Wide OTRLow Phase Noise

22

Wide OTRHigh Stability



Taiwan

Japan

China

Korea

Focus on the 4” Sapphire Wafer Market. & Successfully approved and running into the warm-up production stage

Closely co-work with Japan partner to step into the Japan 4”& 6” Market. Product is approval and under line auditing

Hesitate and initially approach the potential China customers .

Contact with the potential customer and sampling approving of the 4”& 6” Wafers

24


0

5000

10000

15000

20000

25000

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.

4" Capacity(pcs) Sales amount(pcs)Sales (pcs)

25



Revenue will grow gradually and stably.

Gross margin expected to be above 22%.

China market is still growing strongly, especially in smartphone, tablet and infrastructure sectors.

4G application is the major driving force for high-end products along with raising Cloud Computing.

New products are on market smoothly and will bring growth momentum.


2012 Q1 2012 Q2 (f)

Consolidated Operating Revenue 2,394 2,550

Consolidated Gross Profit 522 570

Consolidated Operating Profit 230 265

28



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Investor Conference-20120518 new(by Austin) - 上傳版. 100% WCDMA operators have ... Utilizing mix of Macrocell and small cell ... Increasing system throughput. 3