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KMC Investor Report
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September, 2015
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Disclaimer
This meeting may contain forward-looking statements with respect to the financial condition, results of operations and business of the company. These forward-looking statements represent the company’s expectations or beliefs concerning future events and involve known and unknown risks and uncertainty that could cause actual results, performance or events to differ materially from those expressed. Certain statements, such as those that include the words “potential”, “estimated”, and similar expressions or variations on such expressions may be considered “forward-looking statements”. Financial numbers in this report may include preliminary unaudited numbers or management accounts.
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About KMC
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Over View
� KMC Group is the world’s largest bicycle chain manufacturer.
� Bicycle Chain and Motorcycle Chain are the main products of KMC
Group.
� The main clients are SHIMANO, GIANT, Merida, HONDA , and
YAMAHA.
� KMC was identified as Chinese
famous trademarks in China in
2013.
� KMC Taiwan was identified as
operational headquarter by
Taiwan government in 2013.
◎KMC Group
company area company area
Headquarter
KMC Taiwan Taiwan KMC Vietnam ASEAN
KMC Tianjin North China
KMC Shenzhen﹡ South China
KMC EU Europe KMC Indonesia ASEAN
KMC USA North America
﹡consolidated in 3Q15
Plant Location
Service Center
Bicycle Chain Motorcycle Chain
KMC International Inc.
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Over View
5 circles form 1977
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KMC Vietnam
KMC Indonesia
KMC EU
KMC International Inc.(Headquarter)
KMC Taiwan
KMC USKMC Tianjin
Location
KMC China
KMC Shenzhen
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� KMC is riding on bicycle uptrend, product upgrade will
contribute to near-term ASP/GM upside.
� Group integration plans implemented successfully ,and
these entities generate synergy.
� The important development plan in ATS, GDO ,and others.
Latest News
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Milestone
1970s EstablishmentManufacture-oriented
1980 sExpandingTechnology and Management-oriented
1990 sComposition Cross-StraitsMarketing and R&D oriented
1977, Set up
1986, started partnership with
SHIMANO
1990,Composition Cross-Straits
Established KMC Vietnam for MT.Established sale channel in EU,US , and Asia.
2011, went public through backdoor-listing with a private placement 2012, The Consolidated Plan started
2000 sGlobal OperationValue-oriented
2010 sOrganizational ReengineeringValue-oriented
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Industry information
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What is Bicycle Chain� Bicycle Chain is one of important
components in the drivetrain system of one bicycle.
� The drivetrain system is one of parts of one bicycle, the others are frame and rim system.
� For many reasons to cycle, such as environmental protection, lower energy consumption , decreasing pollution and heavy traffic, human health , sports and leisure.
� Bicycles are no longer bicycles, so chains would keep pace with the times.
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Drivetrain system
≒≒≒≒
Drivetrain system for bicycles Engine and Drivetrain system for bicycles
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Cycling culture is changing
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Trend of High-end Bicycle Chain
Time
Market scale
1980 1990 2000 2010
9 speed
8 speed
10 speed
11 speed
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Trend of High-end Drivetrain System product model
2008 2009 2010 2011 2012 2013
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speed
9
speed
10
speed
11
speed
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KMC is riding on bicycle uptrend
BC
65%-70%
MT
30%-35% KMC
90%
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Motorcycle Transmission and main clients
BC
65%-70%
MT
30%-35%
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Motorcycle Market information
BC
65%-70%
MT
30%-35%
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
2008Y 2009Y 2010Y 2011Y 2012Y 2013Y
Motorcycle produced in Asean
Indonesia Vietnam Thailand Philippines
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Core Competence
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Core Competence�Full products range and high value ratio ( cost/performance)
�Global sales network and local connection�Large manufacture scale and quickly delivery�Unique production tech�Long-term strategy cooperation partnership with clients
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Perfect integration in core technology
KMC KMC KMC KMC
ChainChainChainChain
Precise Precise Precise Precise moldmoldmoldmold
SelfSelfSelfSelf----designed designed designed designed equipmentequipmentequipmentequipment
Heating Heating Heating Heating processprocessprocessprocess
CoatingCoatingCoatingCoatingprocessprocessprocessprocess
Manufacture Manufacture Manufacture Manufacture technologytechnologytechnologytechnology
AutomationAutomationAutomationAutomation
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The state-of-the-art technology
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New model for coming years(DLC)
DLC (Diamond Lean Chain)
S-Works McLaren Tarmac
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New model for coming years(EPT)
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New model for coming years(e-Bike chain)
e-Bike X11e X11e X11e X11e X10e X9e X1X10e X9e X1X10e X9e X1X10e X9e X1
� Highest Torsion Resistance 350kgf
� Highest Pin Power 400kgf
� Tensile Strength Min. 1000kgf
� Compatibility: BOSCH e-Bike system
and other e-Bike system
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Financial Summary
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BC
65%-70%
MT
30%-35% KMC
90%
Consolidated Balance Sheet合併資產負債表Consolidated Balance Sheet (Audited)
現金及約當現金 Cash and cash equivalents 830 88% 395 20% 681 26% 900 26% 2,330 46%其他流動資產 Other current assets 92 10% 670 34% 840 32% 1,012 29% 1,267 25%固定資產 Fixed assets 2 0% 514 26% 486 19% 824 23% 782 15%其他資產 Other assets 15 2% 382 19% 584 23% 772 22% 732 14%資產總計 Total Assets 939 100% 1,961 100% 2,592 100% 3,508 100% 5,111 100%
銀行借款 Loan from bank 0 0% 341 17% 708 27% 586 17% 1,990 39%其他及長期負債 Other liabilities 76 8% 499 25% 385 15% 657 19% 777 15%負債合計 Total Liabilities 76 8% 841 43% 1,093 42% 1,244 35% 2,766 54%股本 Capital 1,030 110% 1,030 53% 1,056 41% 1,092 31% 1,092 21%保留盈餘及其他 Retained Earnings (168) -18% 90 5% 443 17% 1,173 33% 1,252 25%股東權益合計 Total Equity 862 92% 1,120 57% 1,499 58% 2,265 65% 2,344 46%負債及股東權益總計 Liabilities and Equity 939 100% 1,961 100% 2,592 100% 3,508 100% 5,111 100%
1H15
新台幣百萬元/Unit:NT$ million
FY13FY12FY11
Backdoor-listing
KMC-Taiwan
consolidated
KMC-EU&US
consolidated
KMC-Tainjin
consolidated
經營層改組 收購台灣桂盟 收購歐美桂盟 收購天津桂盟
FY14
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BC
65%-70%KMC
90%
Consolidated Financial performance
合併損益表Consolidated Income Statement(Audited)
營業收入 Net Sales 173 100% 1,353 100% 2,092 100% 2,780 100% 1,570 100%
營業毛利 Gross Margin 22 13% 384 28% 645 31% 948 34% 617 39%
營業利益 Operating Profit (30) -18% 248 18% 403 19% 537 19% 398 25%
淨利 Net Income 2 1% 257 19% 378 18% 462 17% 304 19%
每股盈餘 EPS(NT Dollars) 0.02 2.49 3.76 4.31 2.78
新台幣百萬元/Unit:NT$ million
FY13 FY14FY12
收購歐美桂盟 收購天津桂盟
FY11 1H15
Backdoor-listing
KMC-Taiwan
consolidated
KMC-EU&US
consolidated
KMC-Tainjin
consolidated
經營層改組 收購台灣桂盟
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Amortization affect
BC
65%-70%
1Q14 2Q14 3Q14 4Q14 FY14
Revenue 632 601 766 781 2,780
Gross Profit 220 235 273 220 948
Operating Profit 126 142 163 101 531
Net Profit 110 116 136 100 462
Operating Margin 19.9% 23.6% 21.3% 12.9% 19.1%
Net Profit Margin 17.4% 19.4% 17.8% 12.8% 16.6%
Amortization of Intangible Assets* 9 9 14 14 46
1Q14 2Q14 3Q14 4Q14 FY14
Revenue 632 601 766 781 2,780
Gross Profit 220 235 273 220 948
Operating Profit 135 151 176 114 577
Net Profit 119 126 150 113 508
Operating Margin 21.4% 25.1% 23.0% 14.6% 20.7%
Net Profit Margin 18.9% 20.9% 19.5% 14.5% 18.3%
* Because of the acquisition cost exceeded shareholders' equity of acquiree, the premium
should be allocated to Intangible asset, such as Customer Relationship and Patent.
The Intangible asset will be amortized during 4.5 to 5 years.
Announced Financial Statements include amortization*
in NTD mn
exclude amortization
in NTD mn
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Group integration plans
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KMC
KMC-TW
KMC-EU,US,ID
Integration plans in coming years
KMC KMC
KMC-VN
KMC-TW
KMC-VNKMC-EU,US,ID
KMC
KMC-TW
KMC-VN
KMC-Tianjin
KMC-EU,US,ID
KMC
KMC-TW
KMC-VN
KMC-Tianjin
KMC-EU,US,ID
KMC
KMC-TW
KMC-VN
KMC-Tianjin
KMC Shenzhen KMC Shenzhen
KMC China #3
2011 2012 2013 2014 2015 2016
STEP 1
STEP 2
STEP 3
STEP 4
STEP 5
STEP 6
KMC-EU,US,ID
KMC
KMC-TW
KMC-VN
KMC-Tianjin
KMC Shenzhen
KMC China #3
2017
STEP 7
KMC China #4
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China is No.1 in bikes production
North China
East China
South China
West China
In 2013, all factories in China produced 82M bikes and 37M e-bikes
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One of integration(ATS*)Intake camshaft
Rail
Gear of oil pump
Engine crankshaft
Rail
Timing Chain
Exhaust camshaft
*ATS means Automobile Timing System
Drive chain of oil pump
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RailChain
Opener
One of integration(GDO**)
**GDO means Garage Door Opener
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Prior acquisitionYear Target Company
Purchase Price
(1)
Prior BV of
Target(2)
Prior NI of
Target(3)
PBR
=(1)/(2)
PE
=(1)/(3)
FY12KMC TW
KMC VN1,000 584 164 1.7 6.1
FY13
KMC Europe
KMC USA
KMC Indonesia
400 274 51 1.5 7.8
FY14 KMC Tianjin 800 465 90 1.7 8.9
FY15 KMC Shenzhen ﹡ 2,950 2,000 330 1.5 8.9
﹡consolidated in 3Q15
unit in NT$ million
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Financial Plan
EarningEarningEarningEarningBank loan
Capital
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Development Plan
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Development Plan
Bicycle Chain
MotorcycleTransmission ATS GDO
OtherBicycle
Component
the same industry
the same core technology
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Cycling is the best and simplest total solution
� Cycling has always existed as a solution to environmental protection, lower energy consumption , decreased pollution, heavy traffic, human health.
� Bikes for sports and leisure are growing .
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KMC is riding on cycling uptrend� KMC continuously invests in advanced
technologies.
� KMC has optimum products portfolio.
� KMC delicate in brand and distribution
management.
� One-Stop Shop.
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Contact IR Team
For more information or to provide feedback
on our investor relation, please contact at
E-mail:[email protected]
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