LED Vision & Everlight’s Strengths

Trustworthy Innovation Harmony ExcellenceTrustworthy Innovation Harmony Excellence

Everlight Electronics Co., Ltd.

LED Vision & Everlight’s StrengthsLED Vision & Everlight’s Strengths

2 Trustworthy Innovation Harmony ExcellenceTrustworthy Innovation Harmony Excellence


Company FeaturesCompany Features

Founded 1983

IPO Nov 1998 Business Focus Design Design, market & license intelligent light emitting diode (LED) packages. Offering all kinds of visible and invisible LEDs solutions to meet customer’s demands.

Customers Base Over 4,000 Customers Worldwide

Headquarter Taipei, Taiwan

Employees Approximately 3,000 World Wide

Patents Over 30 Issued; Over 30 Ongoing



Business PhilosophyBusiness Philosophy

HarmonyHarmony TrustTrust

InnovationInnovation ExcellenceExcellence

Business Business PhilosophyPhilosophy



Organization ChartOrganization Chart

ProductionGroup

ProductionGroup

SalesGroup

SalesGroup

MIS

Div

ision

HR

Div

ision

Finan

cial D

ivisio

n

Qu

ality

Assu

rance

D

ivisio

n

R&

D D

ivisio

n I

R&

D D

ivisio

n II

Tech

nolo

gy

Div

ision

Logistics D

ivisio

n

Tu-Cheng Factory

Yue-Lee Factory

Pan

-Yu Fa

ctory

Su

-Zhou Fa

ctory

Marke

ting &

Sale

s D

ivisio

n

Overse

as S

ale

s D

ivisio

n

Gre

at C

hin

a S

ale

s D

ivisio

n

General ManagerGeneral Manager

Board of DirectorsBoard of Directors

Audit OfficeAudit Office

EnvironmentalHealth and SafetyEnvironmental

Health and SafetyGeneral Manager

OfficeGeneral Manager

Office

PresidentPresident



IntroductionIntroduction

LED Lamps and Displays manufacturing established in 1983.

Infrared Products introduced in 1984. Established global market presence

through private label manufacturing. ISO-9001, ISO-9002, ISO-14001 and

TS-16949 certifications. Publicly listed and traded on TAIEX Design, market & license intelligent

light emitting diode (LED) packages. Offering all kinds of visible and invisible LEDs solutions to meet customer’s demands.

Over 4,000 Customers Worldwide

Approximately 4,000 World Wide



Total Solution for LEDsTotal Solution for LEDs

■ LED Modules

■ Light Bar

■ Circuit Board Indicators

■ Signage LEDs

■ Photo coupler

■ Infrared (IR) Components

■ LED Lamps and Displays

■Surface Mounted LEDs

■ High Power LEDs



PlantsPlants

CHINA

SMD,

IRM

Suzhou Factory

Visible LED,

ARRAY LED,

Display,

PT/IR/2PT,

ITR, PDIC

Pan-Yu Factory

Yue-Lee Factory

SMD LED,

B/L LED,

Tu-Cheng Factory

Super Bright LED,

Blue/White,

High Power LED

IrDA,

Photo Link,

Photo Coupler



Global LED MarketGlobal LED Market

0

2000

4000

6000

8000

10000

China 300 350 420 525 656 787

Taiwan 857 1102 1188 1336 1571 1806

Korea 394 521 625 750 885 1044

Europe 461 564 632 695 778 880

U.S 527 633 761 899 1033 1188

Japan 2468 2817 2609 2739 2903 3049

2003 2004 2005 2006 2007 2008

US$ Million

Source： PIDA， 2006/1

Total LED market in Japan dropped -7.4% in 2005Total LED market in Taiwan went up 7.8%， Everlight was 9.8%Predicted total global LED market(11.3%) ， Taiwan(15%).



Major LED’s Applications and Major LED’s Applications and Growth OutlookGrowth Outlook

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2004 2005 2006 2007 2008 2009

Indoor decorative lightGeneral and other illuminationLarge LCD BacklightingOther Small LCD BacklightingFlashHandset KeypadHandset BacklightingSignageAutomativeTraffic SignalIR

Source： iSuppli， PIDA， 2005/8

Market Share

2005 2009

Handset

36% 22%

LCD BL 12% 19%

Lighting 9% 23%

57%

Everlight’s marketing strategy will focus on handset 、 BL and lighting applications conforming to the global development trends.

64%



Global White LED marketGlobal White LED market

5,000

5,300

5,600

5,900

6,200

6,500Amount

230,000

235,000

240,000

245,000

250,000

255,000

260,000

Sale RevenueAmount(Million units) Revenue(Million J P Dollar)

Amount(Millionunits)

5080 5,317 5,497 5,895 6,472

Revenue(Million J PDollar)

3E+05 248,300

239,600

239,800

245,700

2004 2005 2006 2007 2008

Source ： Fuji Chimera， PIDA整理， 2005／ 10



Forecast Demand For Handset Forecast Demand For Handset with High Power LEDwith High Power LED

83% 48%Flash LED Growth Rate

Unit: Million (PCS) 2004 2005 2006

Global Cell Phone amount

696 797 895

White LED in Keypad

344 773 1,698

White LED in Backlight

1,239 1,659 2,271

White LED in Flash 257 471 695



For Small Size LCD Backlight， LED’s Price is approaching CCFL .LED will replace CCFL to large Size LCD TV Backlight . According to Insight Media’s research report , Backlight LED in LCD TV will surpass more than 50% in 2010‧

LED Vs.CCFLLED Vs.CCFL

Cost difference LED backlight vs. CCFL -7”LCD

7”LCD White LED CCFL

Quantity used 25~35 1CCFL+1 inverter

Unit Price 0.14 CCFL US$1, Inverter US$2

Total Cost US$ 4.2 3



White LED seizes NB backlight White LED seizes NB backlight marketmarket

• Toshiba announced the first White LED backlight NB used in the world. LCD size is 7.2”and only weighs 980g.

• 11/2005 Sony started selling White LED Backlight NB.Size:1.26Kg ， and 21mm. VAIO embedded CD burner model is the thinnest in the world.(NT$59800~NT$69800)

• 12/2005 Fujitsu started selling LED backlight NB with Lifebook P7120 series. Size:1.38Kg and 4.2mm 、 4.2mm 10.6” widescreen 16:9 aspect.



• Sony announced the first LED Backlight TV in 2004.11.• The LED Backlight TV market is upbeat due to SONY’s

QUALIA series.

LED Backlight in NB & LCD LED Backlight in NB & LCD TV TV

0

5

10

15

20

25

30Million units

2005 2006 2007 2008

LCD TV(>32") Market Volume

LED applied in NB is expansible.

0

5

10

15

20

25

30Million units

2005 2006 2007 2008

LCD TV(>32") Market Volume

Source： Lehman Brothers



Turn Light、 rear light and 3rd stop

light

Interior Light Reading light Dashboard

Mirror reverse and turn lightsidelight

Headlamp

IR Night Vision

License Plate light

Insignia decoration

Antennae decoration light

Footrest light Tire Pressure detector

UV light catalyst



LED in AutomotiveLED in Automotive

0

100

200

300

Rear Lighting Interior Lighting Head Lamp Lighting

Rear Lighting 260 258 274 299 287

Interior Lighting 7 16 34 52 57

Head Lamp Lighting 0 0 0 35 52

2004 2005 2006 2007 2008

Source： iSuppli



• Genera1 2004~2010 CAGR=45%• Indoor Indicator 2004~2010 CAGR=36%

Global LED lighting marketGlobal LED lighting market

0

200

400

600

800

1000

General lighting 94 144 223 322 461 612 875

Indoor indicatorLighting

129 207 301 429 573 712 837

2004 2005 2006 2007 2008 2009 2010

Source： iSuppli



Why Everlight ?Why Everlight ?Osram grants license to Everlight

• Everlight is the 1st LED maker in Taiwan to receive Osram License for TAG phosphor. Our technology and experience leads other competitors.

• Osram GmbH, Munich, and Everlight Electronics Co. Ltd., Taipei, recently signed a patent license contract. Osram has granted Everlight a royalty license to manufacture and sell surface mountable light emitting diodes (SMT LEDs) for white and coloured light and for other white LEDs with conversion technology, for which Osram holds patents. Typical applications include backlighting for mobile phone and car radio displays.

( Source by OSRAM website Press )

Nichia Osram Everlight

White LEDs license

White LEDs Cross license

Osram Grant License



Why Everlight ?Why Everlight ?

Vertical integrated with Epistar (LED chip manufacturer)• Epistar is the biggest LED chip manufa

cturer in the world.

• Epistar was approved by major companies all over the world.

• Own a great many patents in chip technology.

Advance new technology and product development through integrated supply chain.

Epistar+

United Epitaxy

Everlight

LED Chip

LED Packaging

LED Supply Chain Integration

Widest SMD LED product line with high production capacity. Offering fast lead-time and low cost.

Epistar - Largest quaternary compound LED die maker in the world.

Quad： 1200KK

Blue： 300KK

ITO : 120-150KK

OMA： 60-80KK



Core CompetenceCore Competence

• R & D

• Certificates

• Marketing

• Manufacturing

• Quality



R & DR & D

R&D Division IR&D Division IR&D Division IR&D Division I R&D Division IIR&D Division IIR&D Division IIR&D Division II

Taipei Taipei HeadquarterHeadquarter

Taipei Taipei HeadquarterHeadquarter

High Brightness LEDsHigh Brightness LEDs

SMD LEDsSMD LEDs

LED LampLED Lamp

Array LEDsArray LEDs

Infrared LEDsInfrared LEDs

Infrared Sensor Infrared Sensor

Photo CouplerPhoto Coupler

New ProductsNew Products

ModulesModules

Mechanical OpticalMechanical Optical

Material & ChipMaterial & Chip



ManufacturingManufacturing

■ ISO 9001

■ 6 - SIGMA■ OHSAS 18001

■ SPC Activities

■ TS 16949

Total Quality ManagementTotal Quality Management

■ ISO 9002■ ISO 14001



Environmental ProtectionEnvironmental Protection



Everlight is the leading company in LED package ， Everlight has all series of LED products.

Everlight’s vertical integration with Epsitar gives Everlight unsurpassed dominance in the market.

Everlight’s market position ：

Everlight’s current market Everlight’s current market strengthsstrengths

Taiwan No1

MonthlyCapacity（ KK

）BrightLed Haravtek AOT

Everlight

LAMP 100 - - 190

SMD 150 300 150 600

Display 10 - - 10

Infrared 50 - - 150

Other - - - 6

Total 310 300 150 956

Taiwan No1



Global NetworkGlobal Network



Sales TurnoverSales Turnover

209190

145

11090

10385

7255

40

250

0

50

100

150

200

250

300

1996' 1997' 1998' 1999' 2000' 2001' 2002' 2003' 2004' 2005' 2006'

US MillionUS Million



Sales DistributionSales Distribution

2004’

OEM10% TAIWAN

25%

CHINA31%

EUROPE20%

AMERICA4%

ASIA10%

2005’



Past Three Years Sales Patterns Past Three Years Sales Patterns

Q1 Q2 Q3 Q4

2004 25.27% 27.79% 25.04% 21.90%2005 20.27% 22.48% 26.98% 30.27%2006 21.28% 25.93% 26.59% 26.20%

Quarterly Sales Pattern

1H 2H

2004 53.06% 46.94%2005 42.75% 57.25%2006 47.21% 52.79%

Half Year Sales Pattern

(A)

(B)



EL’s Product share in term of EL’s Product share in term of ApplicationsApplications

Product share in 2005

consumerelectronics

43.0%

Display4.7%

MobilePhone39.8%

Small TFTLCD8.0%

Automotive4.6%

Product share in 2006

Consumer Electronics’ share is decreasing.Mobile Phone will grow to a 40% share.TFT LCD, Automotive and Display applications are increasing.

Automotive3.7%

Small TFT LCD6.8%

Mobile Phone37.2% Display

3.7%

consumerelectronics

48.7%



LED Application RoadmapLED Application Roadmap



Future Target Markets：Cell Phone

Automotive

Illumination

Back Light

Combine Solar cell’s application

Future Target MarketFuture Target Market



Financials SummaryFinancials Summary



Income StatementIncome Statement

Year Financial Information

Item 2005 2004 2003 2002

Sales Revenue 6,900,916 6,259,642 5,508,111 3,987,215

Gross Profit 2,503,551 2,038,405 1,601,704 1,083,460

Gross Profit Margin(%) 36.28 32.56 29.08 27.17

Operating Income 1,658,043 1,358,154 1,009,577 579,894

Operating profit to sales(%) 24.03 21.70 18.33 14.54

Nonoperating Income 275,103 265,234 263,325 207,799

Nonoperating Expenses and Losses 185,550 253,019 157,641 115,545

Income before Tax 1,747,596 1,370,369 1,115,261 621,925

Net profit margin before tax(%)

25.32 21.89 20.25 15.60

Net income 1,474,142 1,152,748 958,305 548,526

Basic net income per share (calculated by adjusting dividends declared retroactively)

5.04 4.01 3.52 2.43



2007 Jan.-Nov. Financial Results(Unaudited2007 Jan.-Nov. Financial Results(Unaudited))



2002 2003 2004 2005EPS(After Tax) 2.64 3.91 4.22 5.04Stock Div. 0.8 1 0.4 0.2Cash Div. 1.2 2 2.6 3.5Payout Ratio 75.76% 76.73% 71.09% 73.41%Note:

Dividend Policy NT$/Share

1. Payout ratio = Dividends/EPS after tax, excluding Directors' and Employees' Bonus.2. The average payout ratio for 2002-2005 is 74.25%.

Dividend Policy



2001 2002 2003 2004 2005Employee Bonus(NT$) 5,540,000 44,430,000 67,908,000 81,980,000 104,917,760

Cash Bonus 0 26,660,000 40,748,000 49,180,000 62,957,760Stock(NT$10 Par Value) 554,000 1,777,000 2,716,000 3,280,000 4,196,000

Year End Stock Price 18.70 39.24 61.04 35.59 66.93EPS Dilution(%) 20.17% 12.71% 17.30% 10.16% 19.10%

Employee Bonus Reward & Dilution Effects NT$; Share

Employee Bonus Reward & Dilution Effects



Past 4-Years Financial RatiosPast 4-Years Financial Ratios

Item 2005 2004 2003 2002

23.13 31.44 27.82 25.19

329.67 327.8 285.88 281.07

293.52 311.06 159.93 234.19

246.41 238.49 152.72 163

9,248 3,187.90 289.25 19.79

4.01 4.23 4.22 4.06

7.52 6.13 5.04 4.12

3.18 3.2 3.16 2.41

0.71 0.73 0.76 0.64

16.18 14.61 14.28 9.78

22.17 20.79 19.39 13.55

21.36 18.42 17.37 13.76

5.04 4.01 3.52 2.43

92.14 88.8 69.92 67.87

20.95 16.9 21.01 14.66

Debt Ratio

Long term Debt toFixed Income

Cash FlowReinvement Ratio

Total AssetTurnover(Times)Return to Asset(%)

Return to Equity(%)

Net Profit Margin(%)

Financial Information

Basic net income pershare (calculated byadjusting dividendsdeclared retroactively)Cash Flow Ratio

InventoryTurnover(Times)Fixed AssetTurnover(Times)

Current Ratio(%)

Quick Ratio(%)

Times Interest Earned

Account ReceivableTurnover(Times)

Year

DebtManagement Ratio (%)

LiquidityRatios

CashFlow(%)

AssetManagemen

t Ratios

Profitibility

Documents

LED Vision & Everlight’s Strengths