Y2015 Financial Results 2016/02/25 By Eric Chen [email protected] Safe Harbor Notice This presentation contains forward-looking statements and is subject to risks and uncertainties. Actual results may differ materially from those contained in the forward-looking statements. The projections should not be interpreted as legally binding commitments, but rather as flexible information subject to change occasionally. Y2015 Financial Results Consolidate NT$M Y2012 Y2013 Y2014 27,552 30,660 YOY growth 4% 11% Gross Margin % 39.2% Gross Margin 2015 YOY 1Q 2Q 3Q *4Q *YTD 35,732 8,785 10,027 9,437 9,752 38,001 17% 8% 8% 3% 6% 6% 41.0% 40.3% 40.9% 39.7% 39.7% 41.3% 40.4% 0.1% 10,924 12,586 14,393 3,591 3,980 3,746 4,028 15,345 7% 7,065 7,917 8,884 2,240 2,348 2,422 2,406 9,416 9% 3,858 14.0% 12% 4,668 15.2% 12% 11% 5,509 1,351 15.4% 15.4% 6% 1,632 16.3% 6% 1,324 14.0% 1% 1,622 16.6% 6% 5,929 15.6% 373 500 547 129 -8 195 45 361 -34% Effective Tax Rate 17.6% 20.1% 18.5% 18.5% 18.0% 18.6% 18.9% 18.5% 0.0% NPAT 3,486 4,127 4,932 1,206 1,333 1,236 1,352 5,127 4% 5.67 6.59 7.80 1.91 2.10 1.95 2.12 8.08 4% Sales Operating Expense YOY growth Operating Margin Operating Margin % Non-Operating Income EPS(NT$) *Un-Audited 6% 6% 8% Y2015 Sales By Region Local Sales: US 1,201M, +2% USD$ M 2014 339 179 343 159 92 69 1,180 North America Europe Greater China Asia/Intercon DMS/E2E Affiliates Total Affiliates DMS/E2E 5% 6% 2015 GR% 352 185 371 158 77 60 1,201 AEU: 150.8M GR%: +4% ADLoG: 33.8M GR%: -1% Japan: Korea: AAU/NZ: SAP: Intercon: LATAM Greater China China: Europe 15% 292.7M 6.6M GR% 27.5M 41.4M 10.6M 22.4M 42.8M 13.0M GR%: GR%: GR%: GR%: GR%: GR%: +21% -1% -2% +3% +2% -35% Affiliates/M&A GR%: +11% Taiwan: 71.6M GR%: AiS: 29% 15% 31% 13% 6% 5% 100% Asia/Intercon Asia Intercon. 13% Greater China 31% +4% +3% +8% -1% -17% -13% +2% Europe North America 29% % -5% +48% Advansus: 22.7M GR%: -13% ALNC APOS 12.6M 5.6M GR%: GR%: -7% -40% Advantech Business Group Structure Local Sales: US 1,201M, +2% Embedded Design-In Networks & Communications -6% Embedded Core Computing +4% US 607.4M 50%, +0% Industrial DMS +0% •Blade Computing & Systems •Network Appliances •Network Virtualization Platforms •Embedded Box Computer •Modular Computing Boards •Wireless IoT Modules •Applied Computing DMS •Embedded DMS •Network Appliance DMS •Network & Embedded Switch •Broadcasting & Surveillance Platforms •Display Systems & Gaming Solutions •Industrial Motherboard & DTOS •Embedded Peripherals •Component Purchasing Service % of Sales, YoY Growth US 143.9M 12%,+8% Industrial-IoT Industrial Automation +0% •Industrial I/O & Controllers •Industrial HMI •Automation Computing •IoT Devices & Solutions •WebAccess+ Solutions •iFactory (Industry 4.0) Solutions •Machine Automation Solutions •Power & Energy Solutions Intelligent Systems +5% •Industrial Computers •Industrial Servers & Storage •Intelligent Video Solutions •Intelligent IoT Modules •Transportation Solutions US 358.4M 30%, +2% iConnectivity -2% •iNetworking (B+B) •Industrial Communications •Industrial Switch Smart City Solutions Service Automation Platforms •Industrial Mobile Computing •iRetail Platforms •Medical Computing & Tablets •In-Vehicle Computing US 91.8M 8%, +5% Intelligent Service Solutions •Intelligent Hospital •Digital Logistics & Fleet Management •Intelligent Retail & Hospitality +5% Y2015 Working Capital Consolidate 2013 2014 Full Full 1Q 2Q 3Q Cash Position 4,924 5,648 6,778 7,564 5,348 5,633 Account Receivable 5,359 5,916 5,521 6,436 6,383 6,266 DSO (Days) 59 58 55 62 59 59 4,031 4,782 4,880 4,680 5,175 4,869 76 78 87 71 82 76 3,004 3,166 3,107 3,536 3,436 3,066 55 52 56 53 54 51 NT$ M Inventory DOH (Days) Account Payable AP (Days) *Un-Audited 2015 *4Q