Yeong Guan Group Press Release

Nov 08. 2022

Dear Investors,

YG Group-KY (1589) hereby announces its financial results for the 3^rd quarter of 2022.

2022 Q3 Financial Results

w   Consolidated revenue for the quarter was NT $ 2.48 billion, an increase of 6.43% from the previous quarter and an increase of 9.26% from the same period last year. The revenue composition ratio of each product segment is renewable energy (47.8%), injection molding machines (24.9%), and industrial machinery (27.3%).

w   The tonnage shipped during the quarter was 51,104 tons, an increase of 7.93% from the previous quarter and an increase of 3.18% from the same period last year.

w   Consolidated gross margin for the quarter was 14%, an increase of 1 percentage points from the previous quarter's 13%; a decrease of 3 percentage points from the 17% for the same period last year.

w   The net operating margin for the quarter was 2.37%, an increase of 3.09 percentage point from the previous quarter's -0.72%; a decrease of 0.78 percentage points from the same period last year’s 1.59%.

w   After-tax net loss for the quarter was NT$ 13.5 million, after-tax net loss for the previous quarter was NT$ 91 million, and after-tax net profit for the same period last year was NT$ 29 million; this quarter ’s earnings per share was NT$ -1.21, net profit per share for the previous quarter was NT$ -0.81, and net profit per share for the same period last year was NT$ 0.27.

w   The cumulative consolidated revenue for 3 quarters were NT$6.62 billion, the cumulative net loss after tax was NT$ 423 million, and the EPS was NT$ -3.77.

Operational Outlook

The following statements about future prospects are based on expectations of the current situation, but at the same time subject to known or unknown risks or uncertainties. Please refer to the attached "Disclaimer".

             2022 Q3 Revenue and annual growth rate：

In the third quarter, our shipment had grown since the previous two quarters as COVID-19 restrictions is relaxing in mainland China and customers’ demand deferred from Q1 & Q2. Meanwhile, the price of raw material is decreasing and thus improving our gross profit margin and allowing us to turn a profit. However, as the US dollar interest rate increased dramatically and the Taiwanese dollar became weaker against the dollar, the increase in interest payments for US dollar loan and exchange rate losses led to poor EPS performance. As a countermeasure we plan to issue corporate bonds in Q1 2023 to repay the majority of the US dollar loans. 

Looking ahead to Q4, we are confident and optimistic about the performance as it will be the traditional peak demand season for the injection molding machine and industrial machinery industry due to the Christmas holiday and Chinese New Year’s demand for consumer goods. Thus, we expect these two industries will increase shipment help improve our financial performance. Moreover, under the carbon neutral policy in mainland China, the number of bids for new wind power projects has exceeded 90GW between Jan-Oct 2022. More than half of the top ten manufacturers in terms of bid volume are already long-term strategic partners or potential customers. We estimate the wind power market in mainland China will improve for the short-medium term, and the demand for shipments of the wind power industry will remain at an elevated level.

Revenue and Shipment by quarter

Investor Relations

Kevin Tsai

Assistant General Manager

Add: 4F., No93, Xinhu 1^St Rd., Neihu Dist., Taipei, Taiwan (R.O.C.)

Tel : +886-2-2791-7198 ext. 17

Mobile : +886-978-705-865

E-mail : ir@ygget.com

Safe Harbor Notice

This presentation contains certain forward-looking statements that are based on current expectations and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Except as required by law, we undertake no obligation to update any forward – looking statements, whether as a result of new information, future events or otherwise.