Swancor (TSE: 3708) Company Profile 2017/10 · 2017-10-13 · relates to wind turbine market. •...

Swancor (TSE: 3708)

Company Profile2017/10

1992

Established

in Taiwan

2006

Tianjin, China

2015

Carbon Fiber Composite

2017

Jiangsu, China

Milestones

Copyright © Swancor All Rights Reserved2

2000

Shanghai, China

2013

Offshore wind

power in Taiwan

2016

Taiwan First offshore wind

turbines

Swancor Holding

Fine chemicalCarbon fiber composite

Offshore

Wind Power

Business Units


Anti-corrosion material

Wind Blade

material

Swancor

Renewable

Formosa I

(128MW)

Formosa II

(300-500MW)

Formosa III

(1,900MW)

Revenue

By Business20171H,%

6,000

8,000

10,000

12,000 NT$MN


By Region20171H,%

* Revenue of 2017Q2 is fine chemical only. Revenue from off-shore wind power is not included in this chart..

-

2,000

4,000

2013 2014 2015 2016 2017H1

Anti-corrosion material Wind blade material

Other fine chemicals Offshore Wind Power

Fine Chemical – Anti-Corrosion Material


2,000

2,500

3,000

Fine Chemical – Anti-Corrosion Material

• Major product is vinyl ester.

• Major applications are anti-corrosion tank and pipe for factories, desulfurization tank, and chimney for power plants.

• Broad customer base. Sales through direct channel or distribution. Produce by order.

• Major competitors are Ashland (US) and DSM (Holland).

• Market is oligopolistic with stable gross

RevenueNT$MN


-

500

1,000

1,500

2013 2014 2015 2016 2017H1

• Market is oligopolistic with stable gross margin. Volume grows steadily every year.

• In 2016, Swancor sold 32 thousand tons. Main market was China.

• In 2016, considering vinyl ester only, Swancor sold 18 thousand tones in China. Total China market was 75 thousand tons. Swancor market shares in China was 24%

• International markets are South-East Asia, India and Middle-East.

Fine Chemical – Wind Blade Material


5,000

6,000

7,000

8,000 • Products are epoxy resin and hardener.

• Major customers are China wind blade makers (e.g. Sinoma, SZE: 002080) and international wind blade makers (e.g. TPI Composites).

• Direct sales. Entry barriers in technical support and customer services are high.

• Major competitors are Hexion (US), Olin Epoxy(US), and Huntsman(US).

RevenueNT$MN

Fine Chemical – Wind Blade Material


-

1,000

2,000

3,000

4,000

2013 2014 2015 2016 2017H1

Epoxy(US), and Huntsman(US).

• Market is oligopolistic. Volume is highly relates to wind turbine market.

• In 2016, Swancor sold 23 thousand tons. Main market was China.

• In 2016, total quantity of China market was 115 thousand tons and global market was 250 thousand tons. Swancor market shares in China was 20%.

• International markets are India and northern America.

Carbon Fiber Composite

Global carbon fiber composite demand

Thousand tons

Global carbon fiber composite demandBy application, %, 2016

100

120

140


• Swancor carbon fiber composite factory was completed in April 2016. Formosa Plastic (TSE: 1301) owns 18% of equity.

• Products are pre-peg, thermal plastic plate, and extrusion spar.

• Applications are automotive parts and wind blade spar.

• Thermal plastic plate has manufacturing flexibility and cost advantage over traditional pre-peg , and is recyclable.

0

20

40

60

80

2016 2017 2018 2019 2020 2021 2022

Source: JEC 2016

Swancor Offshore Wind Farms - Formosa I, II and III

• Swancor is developing Formosa I, II and III, three offshore wind farms in Taiwan.

• Formosa I

• Plan capacity is 128MW.

• Phase I 8MW has been installed and is commercially operating. Phase II 120MW will be built in 2019.

• Macquarie, DONG energy, and Swancor owns

Formosa I, II

Formosa III


• Macquarie, DONG energy, and Swancor owns 50%, 35%, and 15% of the equity respectively.

• Formosa II

• Plan capacity is 300-500MW.

• Conducting environmental impact analysis (EIA) and will be built in 2020.

• Formosa III

• Plan capacity is 1,900MW.

• Conducting EIA and will be built in 2021.

Taiwan Offshore Wind Power Market &Swancor Business Model

Taiwan Government offshore wind power target

Accumulated, MW

• Major milestones to develop an offshore wind farm are permits, financing, construction, and

Permits Financing Construction COD

5-7 years 20 yearsdeveloping service O&M


are permits, financing, construction, and commercial operating (COD).

• Swancor provides developing services to offshore wind farms. Normally, it takes 5-7 years to develop an offshore wind farm.

• After COD, Swancor provides operating and management services (O&M). O&M service usually lasts for 20 years.

• In addition to service fees, upon milestones been completed, depending on wind farm projected return, Swancor might get success fee.

Income Statement


•ROE is annualized.

•Sales volume includes anti-corrosion material and wind blade material only, does not include other products.

Balance Sheet and Financial Indexes


Cash Flow


Opportunities in green energy, environmental protection and safety territory: materials for anti-corrosion and wind blade, carbon fiber composite and offshore wind power.

Align with world leaders in the industry: with Goldwind in fine

Why Swancor


Align with world leaders in the industry: with Goldwind in fine chemical, with Formosa Plastic in carbon fiber composite, with Macquarie Capital and Dong Energy in offshore wind power.

Corporate culture of integrity and persistence: Customer service is of utmost importance, Swancor strives for continuous growth, Protection of environment is our priority and Employees share the enthusiasm and prides in the company.

Thank you!

China Wind Power MarketChina Wind Power Curtailment Rate%

10%

15%

20%

25%

30%

China New Installed Wind Power Capacity

GW

25

30

35


In 2016Q1, wind curtailment rate was as high as 26%. Main reasons are power consumption growth rate was low and inter-China power network was not sufficient.

As China invested RMB 218BN in inter-China power network, wind curtailment rate decreased.

0%

5%

2015Q22015Q32015Q42016Q12016Q22016Q32016Q42017Q12017Q2

-

5

10

15

20

2012 2013 2014 2015 2016 2017H1

Technical, procurement, safety, project management

Finance, procurement, project management

Formosa I founder

Swancor Ind.Macquarie

CapitalDong Energy

15% 50% 35%

100%

Holding company of Swancor group

Swancor Holding

Formosa I Business Model


Offshore wind farm developer

Swancor Renewable Formosa Intl. Holding

Perm

it

Fin

ancin

g

Con

struction

O&

M

Developing service

Formosa I

100%

100%

Disclaimer

This document may be deemed to contain forward-looking statements. These forward-looking statements include, among other things, statements regarding future events and the future financial performance of Swancor that involve risks and uncertainties. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results.

Any projections in the document are based on limited internal and external


Any projections in the document are based on limited internal and external information currently available to Swancor, which is subject to change. Actual events or results could differ materially and no reader of this document should assume later that the information provided today is still valid. Such information speaks only as of the date of this document.

Readers shall rely on self-judgment to makes any investment decision. Readers shall not interpret the information in this document to be investment recommendations.

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Swancor (TSE: 3708) Company Profile 2017/10 · 2017-10-13 · relates to wind turbine market. •...

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