pacific hospital supply co., ltdpascho sales revenue reached nt$ 2 billion 3 our certificates common...

Pacific Hospital Supply Co., Ltd 3Q2020 Company Report

2

Our Milestone

1977 PAHSCO formed with a stock Capital of NT$ 1 Million

1980 Started the production & trading of central medical gas equipment

2001 Tong Lo Factories received ISO9001 & CE Certification

2002 Tong Lo (F0) received GMP Certification

2004 PAHSCO became a public listed company in the stock market

2005 Tong Lo (F0’) formed to expand the production of sterilize medical product

2006 The automatic warehousing system was officially implemented in August

1987

2010 Obtained 11,997m2 of production capacity and expanded (F3 sold in 2019)

2009 Tong Lo (F1) constructed in November

2008

2012

Issued series of secured domestic convertible bonds & obtained 7,085 m2 of land

Implemented Oracle ERP (2011) and BPM systems

2019

PAHSCO was Ranked Top 5% for Corporate Governance from 2014 to 2019 & awarded with Best Rankings for Information Transparency and Disclosure from 2008 to 2014.

Tong Lo Factory constructed & expanded the production (F2 sold in 2018)

2014

2016

Implemented new production technique and established mold department

New Factory constructed at Tong Lo Science Park in December

New Factory obtained pharmaceutical manufacturer & ISO 13485 Certification 2017

2018 New Factory registered for GMP & FDA

PASCHO Sales Revenue reached NT$ 2 Billion

3

Our Certificates

Common Wealth Magazine Ranked PAHSCO

• No. 951 in Top 2000 Enterprise (2019) • No. 231 for Sales Growth • No. 349 for After Tax Profit

• No. 36 Most Profitable Manufacturer • No. 11 in Precision Instrument Industry

Company News

Source: https://www.cw.com.tw/cw2000/database

4

https://www.cw.com.tw/cw2000/database

Taichung Office Factories at Tong-Lo Industrial Park

F1 on the right for Sale (Nov. 2019)

Land: 7,085 m2 + Building: 12,059.5 m2

Taipei Headquarter

Our Location

Miaoli

Taiwan

New Factory at Tong-Lo Science Park

Kaohsiung Office

5

Factory sold for 320 M (Tax incl.) TWD(July. 2019)

Land: 11,229 m2 + Building: 17,867 m2

6

New Factory

Land Buildings Capacity

46,000 m²

Factory 44,900 m² AS/RS 4,500m²

(8,100 storage spaces)

Dorm 6,300m² (380 people capacity)

--------------------- Total of 55,700 m²

3.6B TWD sales

7

Introduction to Medical Product Industry and Future

Global Market for Medical Device and Equipment:

2019-2022 CAGR 5.6%

Source: TrendForce 2019/01 ; IRTI/BMI research 2020

Unit：Billion (USD) YoY YoY

Unit：100 Million (USD)

Forecast Slightly

Increased

-

50

100

150

200

250

300

350

400

450

500

Middle Eastand Africa

OtherEurope Asia Pacific

WesternEurope America

Global

12 15

86 95

196

404

15 18

105 112

226

475

6.2% 6.4%

7.0% 5.6%

4.9%

8


Global Market for Medical Device and Equipment:

2019-2022 CAGR forecast (By Region)

Source: 2020 IRTI / ITA Medical Devices Top Markets Report

Market size in 2016 and 2020(f)

Unit：Billion (USD)

CAGR 5.6%

U.S. 43.1%

Japan 7.3%

Germany 7.0%

China 6.8%

France 3.8%

Others 32.1%

9


Global Medical Product Market Share

(2019-2020 By Country) YoY (e) 4.1%

2019 Market Size

404 B (USD)

2020 Market Size (e)

420 B (USD)

U.S. 43.5%

Japan 7.4%

Germany 6.6%

China 7.4%

France 3.5%

Others 31.6%


10


Global Medical Product Market Share

(2019-2020 By Product ) YoY (e) 4.1%

2019 Market Size

404 B (USD)

2020 Market Size (e)

420 B (USD)


Diagnostic Imaging Product 23.3%

Medical Disposal Devices 16.3%

Assistive Device 12.8%

Orthopodic &

Implantable Product 12.0%

Orthodontic Product

7.5%

Others 28.2%

Diagnostic Imaging Product 23.4%

Medical Disposal Devices 16.2%

Assistive Device 12.7%

Orthopodic &

Implantable Product

11.7%

Orthodontic Product

7.5%

Others 28.1%

11

Market of Aging Population

Age % of health expenditure

<25 3.4%

25~34 5.4%

35~44 6.5%

45~54 6.8%

55~64 8.8%

>65 13.4%

*Source: WorldPopulationReview(2019); Franklin Templeton(2016); Council for Economic Panning & Development(2008): UN(2006)

U.S. Europe China Japan

Global low birth rate

12

1950~70

Period

1980~2010

Period

2010

Period

Childhood Adulthood Elder

WWII Baby Boom: 1946-1964 U.S births increased rapidly Aging Boom: 2011-2029 Baby boomers start to enter age of 65

Global Population of Children vs. Elders (%)

Under 5

It is estimated global population age over 65 will surpass age under 5 after 2020 and the difference will continue to grow.

Market of Aging Population

*Source: Franklin Templeton(2016); United States Census Bureau (2016); United Nations(2013)

Over65

Developed Countries

with Subcontract Manufacturing Focus

(ODM/OEM)

Emerging Countries

with Self-Branding Focus

(OBM)

US Japan Germany China Taiwan

Ove

rall In

de

x

Population (Million) 332 126 80 1,394 24

Age

(0~14:15~64:65up) 18 : 65 : 17 12 : 59 : 29 13 : 65 : 23 17：71：12 13 : 71 : 15

Birth Rate：Death Rate 12 : 8 7 : 10 9 : 12 12 : 8 8 : 7

Fertility Rate 1.8 1.4 1.5 1.6 1.2

Life Expectancy at Birth 80 86 81 76 81

2019 GDP (Trillion USD) 21.37 5.08 3.85 14.34 0.58

GDP per Capita (USD) 65,118 40,247 42,259 10,261 25,932

GDP Growth Rate 1.8% 0.9% 0.3% 5.7% 2.7%

Me

dic

al In

du

stry

Ind

ex

Health Expenditure per

Capita（USD）2017 10,246 4,167 5,033 441 1,149

Health Expenditure / GDP 17.1% 10.9% 11.% 5.2% 6.4%

Physicians Density

Per 1000 population

(OECD Avg. of 3.5)

2.6 2.4 4.3 1.8 2.4

Hospital Beds

Per 1000 population

(OECD Avg. of 4.7)

2.8 13.4 8.0 4.3 5.7

13

Overall Index of Geographic Areas

Source: 2020 CIA The World Factbook; World Bank; Ministry of Health and Welfare of Taiwan

14

Taiwan 17.1%

China 11.5%

Other Asia 12.4% North

America 10.2%

Latin America

4.8%

Germany 7.5%

Other Europe

9.4%

Middle East & Others 4.2 %

PAHSCO 2018

Japan

22.9%

Sales Distribution (By Country)

PAHSCO 2019

Taiwan 15.8%

China 11.1%

Other Asia 12.2%

North America

9.3%

Latin America

4.3%

Germany 5.6%

Other Europe 11.1%

Middle East & Others 5.0%

Japan

25.6%

15

Sales Distribution (By Currency Type)

JPY

18%

TWD

17%

CNY

11%

Euro &

Others

4%

PAHSCO 2018

USD 50%

JPY

21%

TWD

16%

CNY

10%

Euro &

Others

5%

PAHSCO 2019

USD 48%

16

Taiwan 14.5%

China 9.3% Other Asia

10.9% North

America 11.4%

Latin America

6.8%

Germany 7.5%

Other Europe 13.0%


PAHSCO 3Q2020

Japan

22.4%

Sales Distribution (By Country)

Taiwan 15.3%

China 10.3%

Other Asia 12.6%

North America

8.5%

Latin America

4.5%

Germany 5.9%

Other Europe 11.0%


PAHSCO 3Q2019

Japan

26.8%

17

Sales Distribution (By Currency Type)

JPY

17%

TWD

14.5%

CNY

9%

Euro &

Others

4%

PAHSCO 3Q2020

USD 55.5%

JPY

22%

TWD

15%

CNY

10%

Euro &

Others

5%

PAHSCO 3Q2019

USD 48%

18

85% 90% 95% 100%

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

3Q2020

90.5%

91.0%

90.5%

90.9%

92.0%

90.4%

92.9%

92.8%

93.0%

93.7%

94.3%

5.00%

5.9%

6.9%

7.0%

7.1%

8.6%

6.8%

6.1%

6.5%

5.3%

5.5%

2.9%

3.1%

2.6%

2.1%

0.9%

1%

0.3%

1.1%

0.5%

1.0%

0.2%

Medical Device Medical Equipment Piping System

Percentage of Product Categories

19

Tubes, 25%

CSS, 24%

WDS, 12%

Bags, 9%

Sets, 8%

Equipment,

7%

Others,

15% (2ND ) Closed Suction System 24% of TR: 434 M (NTD)

(1ST) Tubes 25% of TR: 459M (NTD)

(3rd) Wound Drainage System 12% of TR: 219 M (NTD)

PAHSCO 2018

(4th) Bags 9% of TR: 172 M (NTD)

(5th) Sets 8% of TR: 139 M (NTD)


20

Tubes, 27%

CSS, 23%

WDS, 12%

Bags, 9%

Sets, 8%

Equipment,

5%

Others,

16%

(2nd) Closed Suction System 23% of TR: 473 Million (NTD)

(1st) Tubes 27% of TR: 543 Million (NTD) )

(3rd) Wound Drainage System 12% of TR: 245 Million (NTD)

PAHSCO 2019

(4th) Bags 9% of TR: 187 Million (NTD)

(5th) Sets 8% of TR: 169 Million (NTD)


21

0

100

200

300

400

500

600

Tubes CSS WDS BagsSets

5 year Product Sales Trend

2015 2016 2017 2018 2019

Sales Distribution

(By Product Categories)

(Million NTD)

22

Tubes, 27%

CSS, 24% WDS, 12%

Bags, 9%

Sets, 8%

Equipment,

5%

Others,

15%

(2nd) Closed Suction System 24% of TR: 378 Million (NTD)

(1st) Tubes 27% of TR: 423 Million (NTD) )


PAHSCO 3Q2019




23

Tubes, 22%

CSS, 34% WDS, 10%

Bags, 8%

Sets, 7%

Equipment,

6%

Others,

13%

(2nd) Tubes 22% of TR: 355 Million (NTD

(1st) Closed Suction System 34% of TR: 557 Million (NTD)


PAHSCO 3Q2020




24

0

500

1000

1500

2000

CSSNon-CSS

Total

3Q2019

3Q2020

(Million NTD)

Sales Distribution

(By Product Categories)

% 33.9% 66.1% 100%

yoy +47.3% -8.7% +4.8%

25

Sales Distribution (By Domestic & Export)

1980 2000 2005 2010 2015

Export 0% 15% 38% 81% 82%

Domestic 100% 85% 62% 19% 18%

PAHSCO 1980-2015 3Q2019

3Q2020

Export

85%

Domestic

15%

26

Sales Distribution (By Customer Type)

OEM/ODM OBM Total

917M 905M 1.82B TWD

OBM 50%

OEM/ODM 50%

PAHSCO 2018 PAHSCO 2019

OBM 47%

OEM/ODM 53%

OEM/ODM OBM Total

1.08B 958M 2.04B TWD

27

Sales Distribution (By Customer Type)

OBM 46%

OEM/ODM 54%

PAHSCO 3Q2019

OEM/ODM OBM Total

842 M 725 M 1.57 B TWD

PAHSCO 3Q2020

OBM 45%

OEM/ODM 55%

OEM/ODM OBM Total

898M 745M 1.64B TWD

28

0

500

1000

1500

2000

2500

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Unit: Million(NTD)

The 14th consecutive year with sales growth since 2005.

Year 2005 2009 2016 2017 2018 2019

Sales (NTD) 531M 1.13B 1.69B 1.73B 1.82B 2.04B

Historical Sales

29

Sales by Quarter

Unit: Thousand (NTD)

YEAR 2012 2013 2014 2015 2016 2017 2018 2019 2020

Q1 342,607 357,542 371,812 363,487 452,010 424,871 407,839 482,717 493,955

Q2 341,626 382,503 362,975 353,704 452,428 447,684 427,293 556,964 583,661

Q3 369,016 351,901 376,479 439,502 419,800 455,706 479,033 527,364 565,023

Q4 385,459 351.950 395,398 464,871 365,426 395,710 508,276 473,598 -

Total 1,438,708 1,443,896 1,506,664 1,621,564 1,689,664 1,734,971 1,822,441 2,040,643 1,642,639

YoY Growth

7.1% 0.4% 4.4% 7.6% 4.2% 2.7% 5.0% 12.0% 4.8%

Gross Margin

39.2% 37.5% 36.1% 36.9% 36.5% 29.7% 25.7% 28.4% 31.0%

*Original

currency YoY

Around 8.6%

30

Financial Information

ITEM 2012 2013 2014 2015 2016 2017 2018 2019 3Q19 3Q20

EPS 4.77 4.88 4.95 5.32 5.04 3.59 3.28 6.95 3.23 3.42

ROE % 20.28 19.49 18.55 18.18 15.80 10.65 9.47 18.88 10.11 9.77

ROA % 16.75 16.06 15.33 14.32 11.13 6.98 6.23 12.50 6.36 6.52

Net Profit

Margin 21.90 22.29 21.70 21.66 19.69 13.67 11.87 22.50 14.98 15.13

EBIDA 28.84 28.43 24.39 22.19 25.34 28.84 28.43 24.39 26.42 27.57

Net Cash

per Share 12.40 12.64 11.82 6.81 - - - - - 0.18

Cash

Dividend 4.0 2.5 2.5 2.5 2.5 2.5 3.2 4 - -

*2012Pay-out: $4 Cash Dividend presented at the Shareholder Meeting .

*2013 to 2017 Pay-out: $2.5 Cash Dividend presented at the Shareholder Meeting.

*2018Pay-out: $3.2 Cash Dividend presented at the Shareholder Meeting.

*2019Pay-out: $4 Cash Dividend and $0.997 Stock presented at the Shareholder Meeting.

EPS Adjusted

Retrospectively

31

Medical Device Market Size in China

Market size & Market growth rate Unit: Million (USD)

Source: BMI Espicom; IEK(2017)

CAGR 9.6%

32

Sales (NTD) 2012 2013 2014 2015 2016 2017 2018 2019 3Q19 3Q20

PAHSCO Total

(Billion) 1.44 1.44 1.51 1.62 1.69 1.73 1.82 2.04 1.57 1.64

China

(Million) 130 143 165 194 194 201 209 226 161 152

China % 9.0% 9.9% 11.0% 12.0% 11.5% 11.6% 11.5% 11.1% 10.3% 9.3%

-0.4% 3.9%

Our Sales in China

10% YoY

Growth 15% 4.1% 8.0% 18%

130 143 165

194 194 201 209 226

161 152

2012 2013 2014 2015 2016 2017 2018 2019 3Q19 3Q20

Unit: Million (NTD)

-5.3%

Original Currency

YoY around 0.5%

Thank you

for your attention & patience!

*For your information, PAHSCO presentation will be updated quarterly on the official website: http://www.pahsco.com.tw/investment-23

IR contact: [email protected] ; [email protected]

http://www.pahsco.com.tw/investment-23




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pacific hospital supply co., ltdpascho sales revenue reached nt$ 2 billion 3 our certificates common...

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