Sercomm Corporation

Company Profile

Safe Harbor Notice

The following presentation may contain forward-looking

statements regarding, among other things, our financial

condition, future expansion plans and business strategies

based on our current expectations and projections about

future events. Although we believe that these expectations

and projections are reasonable, such forward-looking

statements are inherently subject to risks, uncertainties and

assumptions.

The company undertakes no obligation to publicly update or

revise any forward-looking statements whether as a result of

new information, future events or otherwise. The actual

results could differ materially from those contained in these

forward-looking statements.

Introduction Established Year 1992

IPO Year 1999 (TWSE:5388)

Locations

Headquarters Taipei, Taiwan

Design Center Taipei & Suzhou (1,200+ RD Engineers)

Manufacturing Suzhou, China

Hsinchu, Taiwan Calamba, Philippines

Global Branches California, USA

Atlanta, USA

Paris, France Dusseldorf , Germany

Moscow, Russia

Tokyo, Japan

2018 Revenue US$ 1.1 Billion

Total Employees 7,000+

Main Products - xDSL Gateway - Cable DOCSIS 3.x

- FTTx / GPON - SMB Products

- Triple-Play / IAD - Small Cell Products

- Smart Home Control - IoT Devices

- An Embedded System Provider to

Timely Offer Total Networking Solutions

Time

To

Market

Simplicity Affordability

Reliability

Internet

Protocols

Intellectual

Properties

Embedded Software

“Embed IP Everywhere”－Our Mission

California

USA

Dusseldorf

Germany

Paris

France

Tokyo

Japan

Taipei

Taiwan

Suzhou

China

Manufacturing

Hsinchu, Taiwan

Manufacturing

Suzhou, China

Suzhou

China

Atlanta

USA

Moscow

Russia

Milan

Italy

Sales Center

RD Center

Manufacturing

Moscow

Russia

Global Offices

Manufacturing

Calamba, Philippines

Embedded Software

Product Assurance

Hardware Design

Manufacturing & Testing

Technology

Artificial Intelligence

(AI)

Operation Management

Software

Total IoT

Solution

Provider

Winning Value Proposition

Top 3 Supplier Worldwide for Wi-Fi CPE

Top 3 Supplier Worldwide for FTTx Products

Top 3 Supplier Worldwide for Small Cells

“Most Honored Companies” － Institutional Investor, 2018

“Best Mid-cap Company” － FinanceAsia, 2015~2018

“Best Managed Company ” － Asiamoney, 2015~2018

“Best Executive in Taiwan”

“Best for Corporate Social Responsibility”

Enrolled in MSCI Global Small Cap Index since 2011

Well-Recognized Market Position

Sercomm Product Portfolio

717928

1,886

3,7995,012

5,670

9,13310,255

8,535

7,089

8,640

13,242

19,26819,077

23,193

35,012

36,702

38,600

33,385

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

CAGR = 24%

NT$ MN

Sales Revenue Growth

EnterpriseProducts14%

Fixed-MobileProducts35%

HomeGateway39%

IoTProducts12%

Evolving Product Mix

2016

$36,702

2017

$38,600

2018

$33,385 NT$MN

HG64%IoT

12%

FM14%

Enterprise10%

HG54%

IoT10%

FM25%

Enterprise11%

Sercomm Manufacturing Centers

State-of-the-art Manufacturing Site

- Specialized in RF Integrated Products

- Eco-friendly Green Factory

Total 7,000+ Employees

- Manufacturing Engineers: 530

- RD Engineers: 1,200

Manufacturing Capacity

- 3.5 Million Units per Month

- AI Embedded Automated Production Lines

Certificates

- ISO 9001, ISO 14001, OHSAS 18001,

TL 9000, CMMI3

NT$ Million 1Q % 1Q % Change

Net Sales 6,480 100.0% 7,963 100.0% -18.6%

Cost of Goods Sold 5,320 82.1% 6,931 87.0% -23.2%

Gross Profit 1,160 17.9% 1,032 13.0% 12.4%

Operating Expenses 953 14.7% 822 10.3% 15.9%

Operating Profit 207 3.2% 210 2.7% -1.4%

Non-operating Income

& Expenses64 1.0% 26 0.3% 146.2%

Income Before Tax 271 4.2% 236 3.0% 14.8%

Net Income Attributable to

Owners of Parent211 3.3% 186 2.3% 13.4%

EPS After Tax (NT$1) 0.86 0.76

Weighted Average

Shares (MN)245 246

20182019

1Q’19 Income Statement - YoY

NT$ Million Amount % Amount % Change

Net Sales 33,385 100.0% 38,600 100.0% -13.5%

Cost of Goods Sold 28,907 86.6% 33,572 87.0% -13.9%

Gross Profit 4,478 13.4% 5,028 13.0% -10.9%

Operating Expenses 3,578 10.7% 3,494 9.0% 2.4%

Operating Profit 900 2.7% 1,534 4.0% -41.3%

Non-operating Income &

Expenses130 0.4% 49 0.1% 165.3%

Income Before Tax 1,030 3.1% 1,583 4.1% -34.9%

Net Income Attributable to

Owners of Parent808 2.4% 1,312 3.4% -38.4%

EPS After Tax (NT$1) 3.32 5.38

Weighted Average Shares

(MN)243 244

20172018

2018 Income Statement

NT$ Million Amount % Amount %

Cash Equivalents 5,782 25.5% 5,854 25.9%

A/R 5,163 22.8% 5,724 25.3%

Inventory 5,263 23.2% 5,890 26.1%

Other Current Assets 1,646 7.3% 671 3.0%

Non-current Assets 4,808 21.2% 4,447 19.7%

Total Assets 22,662 100.0% 22,586 100.0%

Loan 2,633 11.6% 1,960 8.7%

A/P 8,321 36.7% 9,370 41.5%

Leasehold Payable 401 1.8% 124 0.6%

Other Payable & Liabilities 3,772 16.7% 3,691 16.3%

Total Liabilities 15,127 66.8% 15,145 67.1%

Total Equity 7,535 33.2%　 7,441 32.9%

A/R Turnover Days 82 74

Inventory Turnover Days 88 79

A/P Turnover Days 156 137

Mar. 31, 2019 Mar. 31, 2018

Balance Sheet