Company Introduction Presented by Eric Wu Chairman and CEO 2017

Transcription

1 TAIWAN S NO. 1 MEDICAL SKINCARE Company Introduction Presented by Eric Wu Chairman and CEO 2017 Ticker:6523

2 Disclaimer The information and forecast contained in this presentation and released at the same time, including the information regarding business outlook, financial status, and business forecast, is produced according to the internal data of this Company and the status of overall macroeconomic development. The actual operational outcomes, financial status, and sales results in the future may differ from the forecast for various reasons, including but not limited to market demand; changes in policies, laws and regulations, and macroeconomic condition; and other risk factors beyond the reasonable control of this Company. Information contained in this presentation reflects the future outlook of this Company until the present time. This Company makes no guarantee, either expressed or implied, for its accuracy, integrity, or reliability. This Company assumes no responsibility for the update or revision of such information according to its future changes or adjustments. 2

3 DR.WU TW s No.1 Medical Skincare Brand - Quick Facts About Us Founded 2003 by Dermatologist 1600 POS 8 Countries 12 Product Lines - 70 SKU 120 Staffs HQ in Taipei and Shanghai IPO June 2016 Current Market Cap of US$ 280 mn 3

4 DR.WU TW s No.1 Medical Skincare Brand - Our Philosophy About Skincare Taiwan s No.1 Medical Skincare DR.WU is a line of highly effective skincare products developed with advanced patented technologies to target various problems in Asian skins. Our philosophy behind our pursuit for enhancing beauty and wellness is through simple, effective products backed by the latest discovery in Science, Biotechnology and Cosmetics. We believe in the partnership between innovation and science to bring about non-surgical solutions in enhancing one s beauty and wellness. 4

5 DR.WU TW s No.1 Medical Skincare Brand - Brand Origin of DR.WU Create perfect skin through simple but effective ways --Our Philosophy & Goal. DR. Wu Ying-Chin Eric Wu, Chairman & CEO Renowned Dermatologist and Aesthetic Surgeon in Asia Brand Founder of DR.WU Clinical Professor of National Taiwan University Hospital (NTUH) Founder and Chief Physician of WCLINIC and WSPA 1978 Opened his first dermatology clinic 1981 Institut National de la Santé et de la Recherche Médicale Immunology Researcher Developed esthetic medical treatments and dermatology ointments and emulsion formula 1996 Developed first Intensive Whitening Serum with Arbutin 1.5 Generation Entrepreneur Founder of DR.WU SKINCARE CO Columbia University, School of Engineering and Applied Science 1998 PwC Chairman s Office, Corporate Development Associate 2001 Return Taiwan to work for VC funds and started planning for reorganization of family business 2003 Founded DR.WU SKINCARE CO and launched first product under the Brand DR.WU 5

6 DR.WU TW s No.1 Medical Skincare Brand - The Milestones of DR.WU DR.WU Clinical Skincare brand and the Company were formally incepted 2006 Launch in SASA, Health Drugstores, Etc Full Launch in Cosmed Chain Drugstores DR.WU s Hydrating and Whitening Serum was recommend by Barbie Hsu the Beauty Queen 2007 Expanded business overseas: Hong Kong, U.S.A,New Zealand and online: Yahoo! POS of total 500 stores. Product lines add to 6 series Launch in Watsons Taiwan and regional expansion to Singapore. POS of total 900 stores Expanded business into Malaysia Have received recognitions from major Beauty Awards 2012 Launched product in Canada Chairman Eric Wu won TOP 100 MVP Managers award 2013 DR.WU becomes No.1 leading Taiwan s Medical Skincare Sector and launched over 60 SKU 2014 Received investment from L Capital Asia of LVMH Started E-commerce sales channel in China Chairman Eric Wu received 2014 EY Entrepreneur Of The Year award Complete Listing on TPEX (6/16) Expand to Myanmar Increase to 4 counters in Beijing and Shanghai 2015 Went public and listed on Emerging Stock Market Board Received 2015 National Cornerstone Award & Entrepreneur Recognition Setup first counter in Shanghai and launch in 40 FIONA Beauty China stores 6

7 DR.WU TW s No.1 Medical Skincare Brand - Brand Positioning Among Derma Skincare and Doctors Brands DR.WU is a PROFESSIONAL brand positioned to offer Non-Surgical Cosmetic Medicine Concept Skincare with fast effective functional skincare High effectiveness Mid- to High-end Skincare solutions developed by renowned Asian dermatologist for Asian skins, targeting year-old segment Low price High price Low effectiveness 7

8 DR.WU TW s No.1 Medical Skincare Brand Q1 Taiwan Skincare Market Overview TWD Million 2,500 2,000 1, Q1 Taiwan Pharmacy Market YOY -0.2% YOY -5% 2017Q1 Derma Market Share 5% 7% 7% 5% 6% 6% 6% 5% 5% 30% 30% 30% 1, ,191 2,196 1,512 1,585 YOY 11% YOY 11% 204 Caring Mass Derma DR. WU 2016Q1 2017Q1 52% 51% 51% Q1 Others(AVENE Bio FOB..) DR. WU Vichy Curel Neogence Note: The data base of Taiwan pharmacy mark include personal care stores, drugstores, hyper market, super market, CVS and traditional stores. Note: The data base of derma market share include the derma brand sales of personal care stores and drugstores channel. DR. WU Sales of drugstores channel is 11% YOY in 2017Q1, and the growth rate is higher than Caring and same as Derma. DR.WU s market share is 30%, playing the leading position among Derma Skincare Market. 8

9 DR.WU TW s No.1 Medical Skincare Brand - Competitive Advantages and Our Success Formula Product Power Brand Power Sales Power Growth R&D by Authoritative Dermatologist in Asia Leading Cosmeceutical Brand Complete Coverage of Online/Offline Channels High Potential Markets + Necessity of Skincare Complete product line developed by authoritative dermatologists with patented formula in Asia 15% new product development rate Advanced knowledge and skills in R&D 100 patented active ingredients from global pharmaceutical companies 12 full product lines (cyclical, risk diversification, synergy), satisfying needs of Asian skin care Insist on applying 5 principles to develop high effectiveness, hypoallergenic and high quality products Market leader: Taiwan s No.1 Medical Skincare /First to enter the cosmeceutical market High popularity, high reputation, high reliability from consumers One of few Asian cosmeceutical brands to truly stem from doctors and clinics Only IPO cosmeceutical company founded by professional teams with medical background 100% penetration in drugstore chains Full coverage of virtual online stores Present footprint in overseas Chinese-speaking market First Taiwanese brand entering cosmeceutical market Non-surgical cosmetic medicine more common and reaching younger market which drives growth of cosmeceuticals Consumption habits changing from emotional to rational. Consumers trying to select cosmeceutical vs general skincare products Cosmeceutical market growing at double digits 9

10 Our Future Prospects - Market Expansion - China Updates - Omni-Channel - New Product Development - Branding Innovation 10

11 Our Future Prospects - Growth Strategies: 1 Omni-Channel, 2 Concept Products, 3 Thematic Marketing Market Expansion & Omni-Channel Focus on market expansion in China and ASEAN countries for the next two years and adapt Omni-channel strategy to provide full customer services to increase customer satisfaction and loyalty. Newness & Concept Products Continue to develop leading Concept Cosmeceutical products and diversified product portfolio; innovate at 15% New Product Development rate. Thematic Marketing 360 Thematic marketing Theme, engaging multiple celebrities and KOLs to run promotion activities for the extension of brand popularities. 11

12 Market Expansion: Distribution Channel - Regional Sales Channel Distribution Updates Complete Distribution Coverage of Online and Offline Sale Channels B&M Channel - Taiwan Drugstore chains channels Watsons (520) Cosmed (400) Your Chance Pharmacies (45) Department Store Far Eastern Mega City Far Eastern Paoching Far Eastern Kaohsiung Beauty Specialist SaSa(23) (New) Others Duty Free Stores(13) W Clinics(4) Direct One Level Two Level EC Channel - Taiwan DRWU.COM YAHOO MOMOSHOP PCHOME BOOKS PAYEASY, 7net ETMALL Overseas markets Hong Kong, Macao(367) Singapore(52) Malaysia(80) U.S.A(10) Canada(25) New Zealand Myanmar(7) China Channel EC Channel TMALL TAOBAO JUMEI VIP.COM JD.COM Cross Border EC Department Store Shanghai(2) Beijing(2) Cosmetic Stores FIONA (40) MYFACE (10) LILYSTAR (10) Watsons (New) 12

13 Market Expansion: Distribution Split - Sales Contribution by Channel Over the past three years, sales from China market continues to gain contribution from 2% in 2014 to 20% by Brick and mortar channel in Taiwan has also demonstrated strong growth in China 13,636 2% EC TW 126,436 19% 2014 Overseas 40,048 EC TW 6% B&M TW 139, ,959 16% 62% B&M TW 482,689 73% China 138,671 16% 2015 Overseas 54,145 6% China 226,427 20% EC TW 162,325 14% Overseas 66,504 6% 2016 B&M TW 695,338 60% NTD 000 Channel YOY B&M TW 482, , ,338 30% EC TW 126, , ,325 16% China 13, , ,427 63% Overseas 40,048 54,145 66,504 23% Total 662, ,214 1,150,594 33% 13

14 Market Expansion: Expansion Strategy - Global Skincare Market Potential Global share by Category NT$ 3.3tn global skincare market 62x Taiwan MKT China share by Category NT$693bn China skincare market 13x Taiwan MKT Taiwan share by Category NT$ 54bn Taiwan skincare market #1 brand in Taiwan s cosmeceutical market NT$157bn ASEAN skincare market 2.9x Taiwan MKT Thailand Philippines Vietnam Cambodia Indonesia Store-Based Retailing Non-Store Retailing Channel Grocery Retailers Department Stores Beauty Specialist Parapharmacies/Drugstor SubTotal Direct Selling Internet Retailing Homeshopping SubTotal Total '13 14% 14% 14% -0.4% 31% 31% 31% 0.4% 6% 6% 6% -0.3% 14% 13% 13% -0.9% 65% 64% 63% -1.3% 15% 15% 15% -0.4% 13% 13% 14% 1.1% 8% 8% 8% 0.6% 35% 36% 37% 1.3% 100% 100% 100% 0.0% 14

15 China Updates: Strategy 1- Online to Offline - Online First Offline After Expansion 2015 Q Q Q Q Q Q Q Q4 EC 電商 DS 百貨 SUPER BRAND Shopping Mall Counter, Shanghai BEIJJING - Longfor - Capitaland BEIJJING - JoyCity ZY CS 美妝 FIONA Beauty Stores (41stores) MYFACE Beauty Stores (10stores) LILYSTAR Beauty Stores (11stores) SHANGHAI - Longemont 15

16 China Updates: Strategy 1- Online to Offline Entry Plan in WATSONS(3000 Stores) Wall Unit Stage 1: H Total of 50 doors 45 Wall Units / 5 Counters & Store in Store Stage 2: H Total of 100 doors 90 Wall Units / 10 Counters & Store in Store North: doors West: 10 5 doors East: doors Counter South: doors Store in Store 16

17 China Updates: Strategy 2 - Focus on One Star Product - Focus on Pore Control / Acne Prone problems with Mandelic Acid 6% Focus on one product at a time to quickly catch customers eyeball. Through high effectiveness to fast attract customers interests. Rapidly Establish Brand recognition and awareness in China. T-mall NO best skincare brand of first-tier cities university students Daily Renewal Serum With Mandelic Acid 17

18 China Updates: Strategy 3 - Celebrity Brings Eye Balls - Brand Endorser for 2016: Hannah Quinlivan Continue Endorser in 2016, DR.WU has Successfully Enhanced Brand Awareness throughout ASIA: Hannah's marriage to Jay Chou who is the most popular singer in Asia and her recent has children announcement has created tremendous online chatter and followers. Videos of Hannah sharing her beauty tips using DR.WU Serum and Mask during New York Fashion Week, attracting 34,822,000 Unique Visitors. 18

19 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 China Updates: Growing Brand Awareness in China - Baidu/Weibo/Wechat and UV indices Brand Awareness, Positive Word of Mouth and Client Loyalty have surged coupled with Increasing attention from media Wechat/Weibo Fans 187,631 33,920 0 Baidu Index 1,400 1, Wechat Fans Weibo Fans 1, Jumei/Tmall Unique Vistors , , , , , ,626 69,163 0 Jumei UV Tmall Flagship UV 19

20 Omni-Channel Strategy - From Transactions to Relationships Transactions BIG DATA PRM Relationships Guessing Preferences SOCIAL MEDIA LOYALTY PROGRAM Prediction for Customization CRM Cross-channel Integration CRM Loyalty Program Engage with customers through QR code across any channel interaction, physical and digital Integration of all data flow from multi-channels Analyzation of customer data through systems Deliver relevant experience to match behaviors, needs and increasing expectations. Through loyalty program design to retain customers and boost their engagement Seamless, orchestrated, and personalized 20

21 New Product Development: Complete Product Lines - Complete Product Lines: 12 Key Lines x 70 SKU HYALUCOMPLEX HYDRATING SYSTEM x12 36% BASIC CARE SYSTEM x3 MANDALIC RENEWAL SYSTEM x9 30% UV PROTECT SUNCARE SYSTEM x6 AGEVERSAL REPAIRING SYSTEM VITAMIN C + WHITENING SYSTEM ACNECUR ANTI-ACNE SYSTEM x9 11% x6 7% x5 12 SERIES- 70 SKU Average Retail Price USD 40 MINERAL MAKE UP PREMIUM SKINCARE SKINCARE FOR MEN x6 x7 x6 x8 x2 CAPSULE MASK FIRST AID SERIES 21

22 New Product Development: Complete Product Lines - Top 10 Best Sellers in 2016 Taiwan TOP 10 = 45% China TOP 10 = 60% NO. Product % NO. Product % NO. Product % NO. Product % 1 INTENSIVE RENEWAL SERUM WITH MANDELIC ACID 18% 15ML 7% 6 INTENSIVE REPAIRING SERUM WITH SQUALANE 35ML 4% 1 DAILY RENEWAL SERUM WITH MANDELIC ACID 6% 15ML 29% 6 INTENSIVE HYDRATING SERUM WITH HYALURONIC ACID 15ML 3% 2 INTENSIVE RENEWAL SERUM WITH MANDELIC ACID 18% 30ML 7% 7 INTENSIVE HYDRATING GEL WITH HYALURONIC ACID 30ML 3% 2 DAILY RENEWAL SERUM WITH MANDELIC ACID 6% 30ML 8% 7 Deep Hydrating Capsule Mask With Vitamin A 3PCS 3% INTENSIVE HYDRATING SERUM WITH HYALURONIC ACID 35ML EXTRA HYDRATING LOTION WITH HYALURONIC ACID 50ML INTENSIVE HYDRATING TONER WITH HYALURONIC ACID 150ML 5% 8 5% 9 4% 10 ULTIMATE HYDRATING MASK WITH HYALURONIC ACID 3PCS INTENSIVE WHITENING SERUM WITH VITAMIN C+ 30ML EXTREME MICRO- LIFTING CREAM WITH AGEVERSAL 30ML 3% 2% 2% ULTIMATE HYDRATING MASK WITH HYALURONIC ACID 3PCS INTENSIVE HYDRATING TONER WITH HYALURONIC ACID 150ML DAILY RENEWAL SERUM WITH MANDELIC ACID 6% 5ML 4% 8 4% 9 3% 10 Soothing Moisture Capsule Mask With Vitamin B DAILY RENEWAL LOTION WITH MANDELIC ACID 15ML EXTRA HYDRATING LOTION WITH AQUA-COLLAGEN 15ML 2% 2% 2% 22

23 New Product Development: New Products and Continue to Elevate Existing Series Products renewal rate remain at 15% per year. Continue to develop high efficacy, non additive, medical skin care products. Diversified product portfolio, extent product form type and reach new demographic. Mineral Make-up: 1 st Derma brands DD cushion. By using the microcrystalline powder "Accurate Match Powder and multiple caring essence to have natural lightpermeable make-up Ultra Potency Concentrate : This program can achieve micro surgery result through DR.WU s high potency gentle insensitive formula, suitable for in-house treatment Earth Resource Mask: Concept origins from using natural herbal and extracts ingredients for Mask. New hit products after hero items capsule mask. Continuous formula upgrades for current products 23

24 Branding Innovation: 360 Marketing Theme -From one Endorser to multiple Endorsers with celebrities Brand Endorsers Different endorsers with quarterly theme Internet Celebrity With Live video delivery We Media KOL Management and Wordof-mouth Media Platform Channel Linkage Social Media Collaboration with top content providers Creates direct sales links to channel Extension of fans club Wechat/Weibo 24

25 Our Future Prospects: Strategy Building Blocks -Product Innovation, Profit growth, and Market leading Becoming Asia s Leading Cosmeceutical Brand Product Power Deliver core values R&D masstige products to drive micro surgery market Extension to cosmetics and natural extracts masks Product revamp by continuous upgrades Brand Power Taiwan Leading No. 1 Thematic marketing campaigns promotions Engage multiple celebrities to extend brand popularities Increase customer loyalty through CRM program Sales Power Channel Coverage Establishment of Omnichannel to provide full customer services Organic growth in existing markets Continuous online and offline channel development Infrastructure build out Organization enhancement People development and retention Process improvement plan 25

26 Financial Performance - Revenue and Net Profit Updates - Income Statement Summary - Balance Sheet and Key Indices 26

27 Financial Performance Q1 Revenue Updates 1,300,000 1,200,000 1,100,000 1,000, , , , , , , , , ,000 - Consolidated Revenue (NT$'000) 2017Q1: 10.2% 505, , , , : 33% 1,150, , , , , , , , , , ,982 Q1 Q2 Q3 Q4 Sales-2015 Sales-2016 Sales Accumulated Revenue Accumulated Revenue 2017Q1 revenue is 10.2% higher than last year. Sales growth rate is slightly lower mainly due to change of distributors in China, Malaysia and Singapore, as well as RMB depreciation impact at consolidate level. Sales has been picking up from March. 27

28 Financial Performance Q1 Net Profit Updates 350, , , ,000 Consolidated Net Profit (NT$'000) 213, : 37% 312, , , , Q1: 1.3% 140,522 56, ,917 50,000-80,348 91,473 98,992 67,019 67,917 73,503 72,609 37,635 18,934 Q1 Q2 Q3 Q4 Net Margin-2015 Net Margin-2016 Net Margin Accumulated Net Margin Accumulated Net Margin 2017Q1 operating profit is 92m, YOY 12%, mainly driven by topline growth and improved gross margin in China, but net profit YOY is 1.3%, EPS 1.48 mainly offsetting by foreign exchange rate loss as a result of strong NTD impact. 28

29 Financial Performance - Income Statement Summary Consolidated Item Q1 2017Q1 YOY% Amount % Amount % Amount % Amount % Unit: NT$'000 YOY% Revenue 865, % 1,150, % 33.0% 234, % 257, % 10.2% Cost of Sales 273, % 355, % 29.6% 76, % 81, % 6.1% Gross Profit 591, % 795, % 34.5% 157, % 176, % 12.2% Operating Expenses 326, % 412, % 26.5% 75, % 85, % 11.9% Operating Profit 265, % 382, % 44.4% 81, % 91, % 12.4% Non-Op Income & Expenses 8, % -7, % % -1, % -10, % 445.4% Profit Before Taxes 273, % 374, % 37.1% 79, % 81, % 2.2% Income Tax Expense 45, % 62, % 39.3% 12, % 13, % 6.5% Net Profit 228, % 312, % 36.7% 67, % 67, % 1.3% EPS (NT$)

30 Financial Performance - Balance sheet & key Indices Consolidated Unit: NT$'000 Item Cash and Cash Equivalents 286, , , ,418 Accounts Receivable 163, , , ,025 Inventories 113, , , ,758 Other Financial Assets 430, , ,916 1,084,907 Total Assets 1,068,585 2,244,170 1,180,233 2,280,079 Total Liabilities 112, , , ,663 Total Shareholders' Equity 955,737 2,049,611 1,022,232 2,111,416 Key Indices A/R Turnover Days Inventory Turnover Days A/P Turnover Days Liability Ratio (%) ROE(%) Cash from OP activities 166, ,054 58,305-1,544 30

31 Thank You Your Personal Doctor For Your Perfect Skin -DR.WU Contact Information Jennifer Tu, CFO ext. 83 Fiona Chiu, Financial Manager ext. 36 TEL: Mobile: