Investor Conference - Rechi › image › en › invest › 2019 rechi presentation_v2.pdf ·...

Transform & Insist Move to our future

Investor Conference


Safe Harbor Notice

• RECHI’s statements of its current expectations are forward looking statements subject to

significant risks and uncertainties and actual results may differ materially from those

contained in the forward-looking statements.

• Except as required by law, we undertake no obligation to update any forward-looking

statement, whether as a result of new information, future events, or otherwise.

2


Company Introduction

Financial Highlights

Market Opportunity

Development Strategy

Outline

3


SAMPO Corporation 26.73%

China Steel Corporation 4.55%

Sharp Corporation 4.50%

Others 64.23%

Main shareholders

Market OpportunityFinancial HighlightsCompany Introduction Development Strategy

Until Dec 31, 2018

4


Organization structure

Rechi Holdings Co., Ltd.

Qingdao Rechi

Electric

Machinery

Sales Company

Dongguan Rechi

Compressor Co.,

Ltd.

Rechi Investments

Holdings Co., Ltd.

Rechi

Precision(Jiujiang)

Electric Machinery

Limited

Rechi

Refrigeration

Dongguan Co.

Ltd.

Rechi Precision

(Huizhou)Mecha

nism

Company

Rechi

Precision(Qingdao)El

ectric Machinery

Limited

Rechi International

Holdings Co., Ltd.

Dyna Rechi Jiujiang

Co., Ltd.

GR Holdings

(Hong Kong)

Limited

RECHI PRECISION CO. , LTD

Rechi Investments Co., Ltd.

TCL Rechi (Huizhou)

Refrigeration

Equipment

Company Limited

25%67.86%

77.78%

50%

100%

100%

100%

100%

50%

100%

100%

100%

100%

100% 35.5%


100%

42.2%

64.5%

Ablek Technology

Co., Ltd

100%

（Samoa） Ablek

Technology Ltd.

100%

100%

Ablek Technology

Ltd.

Dyna Rechi Holdings

Co., Ltd.

Dyna Rechi Co., Ltd.

5

Transform & Insist Move to our future 6

India service office

Thailand service office

Pune

Bangkok

Houston

U.S.A. liaison office

Osaka

Japan liaison office

Cover area : 34,194m2

HR TR

Cover area : 160,000m2 Cover area : 20,000m2

DR

Cover area : 151,016m2 Cover area : 29,652m2

KRJR/DRJ

Cover area : 298,149m2

HQ and R&D center

QR

North China service center

Location of facilities & Production Capacity

Central China service center

South China service center

Sales head office in CHINA

Sales head office in Non CHINA


CompressorCurrent capacity 9 million

under construction 3 million

Compressor Current capacity 6 million

BLDC motor Current capacity 3.9 million

Motor Current capacity 5 million

Compressor Current capacity 6 million

BLDC motor Current capacity 1.5 million

Compressor under construction 2 million

Motor Current capacity 5 million

DRD


Milestone of RECHI Market OpportunityFinancial HighlightsCompany Introduction Development Strategy

7

1989Oct. 19th

2000

Company funded

Taiwan (Guanyin factory )

Established

China (Humen factory)

Established

1993

2001

2005

China (Qingdao factory)

Established

20102011

SHARPJoined as one of our major shareholders

CSC Group

Joined as one of our major shareholders

2003

IPO in TAIWAN

(No. 4532)

2014

U.S.A. service officeset up

China (Jiujiang factory

Established

India liaison office set up

20172015

Thailand liaison office

set up

Japan service office

set up

2013

2018

Accumulative sales of compressors reached

100 million units in 2014

2012

( The 100 millionth unit was produced on April 13th)

( The 100 millionth unit was sold on May 8th)

China (Huizhou factory)

Established

Dyna Rechi (Pingtung & Jiujiang

factories opened) Established

Formed a joint venture with Zhejiang BaidaPrecision Manufacturing Corp. and established JBPM

Formed a joint venture

with CSC Group and

established CSMQ

Dyna Rechi

acquired

Ablek

technology

Co., Ltd

2019


Financial Highlights

8


0

5,000

10,000

15,000

20,000

25,000

30,000

-

5,000

10,000

15,000

20,000

25,000

'09 '10 '11 '12 '13 '14 '15 '16 '17 '18

Production Sales Reveunue

Unit: k Unit: NT$ mn

Revenue growth of RECHI


Accumulative Sales Quantity

reached to 100 million units.

◆ 2018 Production：19,026,685 units

◆ 2018 Revenue：NT$ 22,479 mn

Until Dec 31, 2018◆ Cumulative Sales：172,376,496 units

9

Revenue


Revenue growth

Margins

%Unit : NT$ mn


6,922

12,587

16,794 15,285

16,473 18,127 15,630

17,674 19,827

22,479

-40%

-20%

0%

20%

40%

60%

80%

100%

0

5,000

10,000

15,000

20,000

25,000

09" 10" 11" 12" 13" 14" 15" 16" 17" 18"

Revenue Growth YoY

5.4%

13.0%14.2%

17.0% 16.5% 17.4% 17.1%20.8%

15.1%15.8%

-2.9%

6.2%8.0%

10.3% 9.1% 8.8%

7.3%

11.2%

7.2%7.3%

09" 10" 11" 12" 13" 14" 15" 16" 17" 18"

Gross margin Operating margin

10


ROE & ROA

Operating CF & CapexUnit : NT$ mn


-5.5%

10.0%

14.6% 14.6%12.6% 12.6%

9.1%

14.4%11.0% 12.0%

-1.7%

5.6%

7.5% 7.2% 6.1% 6.3%4.7%

6.8%4.9% 5.1%

-10%

-5%

0%

5%

10%

15%

20%

09" 10" 11" 12" 13" 14" 15" 16" 17" 18"

ROE ROA

1,690

434

1,659

1,246

2,063

-57

2,054

1,238

487

2,352

215 277

1,334 1,550

730

1,079 1,266

847

1,385

2,073

09" 10" 11" 12" 13" 14" 15" 16" 17" 18"

Operating CF CAPEX

11


Dividend policyMarket OpportunityFinancial HighlightsCompany Introduction Development Strategy

* Based on share price on following year closing before ex-dividend day

2014 2015 2016 2017 2018

EPS (NT$) 2.3 1.86 2.8 2.1 2.2

Cash DPS (NT$) 2 1.6 2.28 1.75 1.2

Payout ratio (%) 87.0 86.0 81.4 83.3 54.5

Cash yield (%)* 8.6 6.2 7.0 5.8 4.8

12


Income statementMarket OpportunityFinancial HighlightsCompany Introduction Development Strategy

Unit in Thousand NT$ 2019H1 ％ 2018H1 ％ YoY %

Sales volume of

compressor10,020,286 10,419,167 -398,881 -3.8

Sales revenues 11,510,776 100 12,582,359 100 -1,071,583 -8.5

Cost of goods sold -9,798,498 -85.1 -10,621,574 -84.4 823,076 -7.7

Gross margin 1,712,278 14.9 1,960,785 15.6 -248,507 -12.7

Operating expenses -1,110,560 -9.6 -882,382 -7.0 -228,178 25.9

Income(Loss) from

operations601,718 5.2 1,078,403 8.6 -476,685 -44.2

Total non-Operating

income and expenses-4,232 -0.0 -8,464 -0.1 4,232 -50.0

Income before tax 597,486 5.2 1,069,939 8.5 -472,453 -44.2

Income tax -159,508 -1.4 -347,602 -2.8 188,094 -54.1

Income after tax 437,978 3.8 722,337 5.7 -284,359 -39.4

13

*Consolidated financial statements have been reviewed by the CPA firm of Deloitte & Touche


Balance sheetMarket OpportunityFinancial HighlightsCompany Introduction Development Strategy

Unit in Thousand NT$ 2019H1 ％ 2018H1 ％ YoY %

Cash and current financial

assets4,790,402 16 4,881,826 18 -91,424 -2

Accounts receivable,net 10,655,097 37 11,156,998 41 -501,901 -4

Inventories 2,496,621 9 2,114,640 8 381,981 18

Other current assets 1,242,868 4 1,165,882 4 76,986 7

Total current assets 19,184,988 66 19,319,346 70 -134,358 -1

Property,plant and

equipment,net7,222,135 25 6,513,166 24 708,969 11

Other non-current assets 2,639,682 9 1,577,851 6 1,061,831 67

Total assets 29,046,805 100 27,410,363 100 1,636,442 6

Short-term loans 5,247,777 18 5,404,347 20 -156,570 -3

Accounts payable,net 7,224,942 25 6,000,531 22 1,224,411 20

Other current liabilities 2,580,526 9 2,732,165 10 -151,639 -6

Total current liabilities 15,053,245 52 14,137,043 52 916,202 6

Long-term loans 3,629,910 12 3,117,820 11 512,090 16

Other non-current liabilities 711,138 2 671,844 2 39,294 6

Total liabilities 19,394,293 67 17,926,707 65 1,467,586 8

Total stockholders' equity 9,652,512 33 9,483,656 35 168,856 2

14



Cash flow statement



Unit in Thousand NT$ 2019H1 2018H1

Cash, beginning of year 1,691,863 1,875,853

Net cash provided by operating activities 400,221 -57,090

Cash flow from investment activities -1,487,372 -1,036,016

(Decrease) increase in short-term loans, net 226,247 1,225,420

(Decrease) increase in long-term loans, net 500,000 900,000

others 21,323 -63,838

Cash, end of year 1,352,282 2,844,329

15


Market Opportunity

16


The market trend of Global A/C Unit：10k

Reference : IOL, HENGTA, GI , JRAIA


122,310 133,550 133,210

114,420

155,650 164,060 163,402 168,304 173,353

2.1%

9.2%

-0.3%

-14.1%

36.0%

5.4%

-20%

-10%

0%

10%

20%

30%

40%

0

50,000

100,000

150,000

200,000

250,000

300,000

2013 2014 2015 2016 2017 2018 2019(F) 2020(F) 2021(F)

Global A/C

Sales

Growth YOY

線性(Sales)

17


Reference : IOL

Unit：10k


The market trend of rotary compressor in CHINA

129,990

152,520

133,621

151,825

192,724 206,036 202,100

213,290 224,480

10.5%

17.3%

-12.4%

13.6%

26.9%

6.9%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

0

50,000

100,000

150,000

200,000

250,000

300,000

2013 2014 2015 2016 2017 2018 2019(F) 2020(F) 2021(F)

CHINA rotary Compressor

Sales

Growth YOY

線性(Sales)

18


51,690 56,570 52,610 64,370

84,850 96,458

108,740

122,333

137,625

24.1%

9.4%

-7.0%

22.4%

31.8%

13.7%

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

35%

0

50,000

100,000

150,000

200,000

250,000

300,000

2013 2014 2015 2016 2017 2018 2019(F) 2020(F) 2021(F)

CHINA BLDC Motors

Sales

Growth YOY

線性(Sales)

The market trend of BLDC Motor in CHINA

Reference : IOL

Unit：10k


19


The top 6 of rotary compressor makers in CHINA Unit：10k

Reference : IOL


35,020

44,080 42,410

49,620

61,010

68,250

27,210

36,130

30,550 33,310

46,817 49,392

16,499 18,106 15,114 18,315

24,273 24,890

12,368 13,513 12,380 15,084

17,657 19,026

10,340 11,010

8,870 8,601 10,820 11,390

5,740 6,280

5,540 6,026 7,770 8,580

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

2013 2014 2015 2016 2017 2018

GMCC

LANDA

HIGHLY

RECHI

PANASONIC

LG

20


Korea, 0.5% Taiwan, 1.1% Middle East, 2.3%

India, 4.0%

Japan, 4.1%

S American, 7.3%

SE Asia, 10.1%

China, 17.4%

N American, 26.0%

Europe, 27.2%Korea

Taiwan

Middle East

India

Japan

S American

SE Asia

China

N American

Europe

RECHI Sales : Geographic distribution

★ RECHI sold over 150 customers in 28 countries worldwide. Reference : 2018

RECHI Sales : Application distribution


62.2%

37.8%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

RAC+PAC others

RAC+PAC

others

21


Development strategy

22


Development Strategy

Opportunities

for new energy-

saving markets

Pursue Create

New energy-

saving

products

Technology

Innovation

Market Demand

THE STRATEGY

OF VALUE

REVOLUTION


23


Now Future2019RHCHI 30th

• Compressor

• BLDC Motor

Value Innovation

Subversive innovation

The business model of Subversive innovation products and Core Technology

Core business

• MINI SMART AIRCON

• SMART DC FAN

• Others (innovation products)


New growth

business

• (ABLEK TECHNOLOGY CO.,LTD.)

This product can be customized design and assembled, and applied to

personal mini air conditioner, wardrobe dehumidifier and pets e-Nest.

24

Transform & Insist Move to our future25

Cooling e-Nest

Choose the best to love your pets

Energy saving CombinationConstant Temperature

Sterilization

25


Foldable Cordless Bluetooth speaker Long Endurance

26


ProductCompetitiveness

• Increasing Output efficiency of units / work hours

• Improving design cost competitiveness

• Reducing procurement costs

• Integrating RECHI group production line and reducing the transportation

cost of components

• Stabilizing global strategy customer sale ratio

• Increasing the proportion of sales of DC inverter compressors

• Increasing new customer、new market、new application

Upgrading RECHI’s Competitiveness

CostCompetitiveness

SalesCompetitiveness

• CompressorHigh energy-efficiency、Larger size、Smaller size、Less noise、Application

• MotorProduction Maximization、Subversive innovation product、Expanding motor product items

27



Create unlimited possibilities for the Energy Saving Industry.

Become the top provider of proactive Energy Saving Product.

28

Date post:	27-Jun-2020
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