November 2010
1 This presentation may contain forward-looking statements concerning Asia Pacific Wire & Cable Corporation. The actual results may differ materially depending on a number of risk factors including, but not limited to, the following: general economic and business conditions, development, shipment, market acceptance, additional competition from existing and new competitors, changes in technology or product techniques, and various other factors beyond its control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risk factors detailed in the Company's reports filed with the Securities and Exchange Commission. Asia Pacific Wire & Cable Corporation undertakes no duty to revise or update any forward- looking statements to reflect events or circumstances after the date of this presentation. Safe Harbor Statement
2 Equity Snapshot Ticker:AWRCF.OB Price (11/12/10):$7.10 Market cap:$98.0 million Revenues (TTM):$435.0 million Net income (TTM):$15.6 million Diluted shares outstanding:13.8 million Diluted EPS (TTM):$1.13 Net book value per share (9/30/10):$10.69 Fiscal year ends:December
3 Market leader in several regional markets Strong and growing underlying market demand Broad geographic coverage offers diversification Experienced and knowledgeable in-house sales and technical team Improving financial performance including a return to profitability Strong balance sheet, cash flow, and attractive valuation Investment Highlights
4 Company Overview Founded in 1996 Headquartered in Taipei, Taiwan Subsidiaries: China, Thailand, Singapore and Australia Core business: manufacturing and distribution of wire and cable products Additional services: project engineering of Supply, Delivery and Installation (SDI) services for power cables Total number of employees: approximately 1,710 6
586 Locations and Facilities SDI project engineering Power cable Distributed products Telecommunication cable Enameled wire Employee headcount % Revenue contribution (1H09) Others:5.6% Distributed products include in Singapore, Australia, Thailand and SPFO Epan is included in CCH % 42.0% 16.1% 9.9% As of September 30, 2010 (unaudited)
6 Global Industry Overview Wire & cable growth industry growth drivers Energy-related infrastructure spending Telecom-related infrastructure spending Construction cycle Industrial activity Local presence required High transportation costs Products need to meet regional specifications Handling and logistics ~ 80% of manufacturing cost attributable to raw materials Pass-through pricing generally utilized for long-term agreements About one-half of business priced short cycle Global Cable Production by Type Source: CRU estimates Global Fiber Optic Cable Market Growth Forecast (Million f-km)
7 China Businesses Long-term partnership with China Unicom Products Enameled wire Telecom cable Fiber-optic cable Optical fiber (JV) Rubber cable Top Customers Telecom carriers Toolmakers and appliances makers Mining companies Revenue ($ Millions) $36 $47 $46 $61 $91 $103 $135 $114 $158 $149 $0 $20 $40 $60 $80 $100 $120 $140 $160 $ CAGR = 14.6%
8 Thailand Businesses Top-5 cable producer in Thailand Products Telecom cable Power cable (Al, Cu, HV) Enameled wire Fiber-optic cable Top Customers Local electric utilities companies Engineering companies Contractors Telecom carriers
9 Singapore Businesses Leading provider of power cable in Singapore Products Power cable SDI project engineering Distributed products Top Customers Electrical contractors Distributors Public utilities Board
10 Australia Businesses Leading provider of power and construction cables New opportunities for distribution due to pan – Asia trade agreement Top Customers Contractors Distribution Centers Products Low-voltage power cables Construction cables
11 Product and Service Portfolio Revenue ($ millions) Revenue (Unaudited) % of Sales Gross Margin (unaudited) Products M20099M2010 Telecommunication Cable $46.4$47.0$62.0$49.1$ %26.4% Power Cable %18.5% Enameled Wire %6.9% Distributed Products %6.9% SDI Project Engineering Services %1.2% Total$509.8$500.8$362.2$252.4$ %12.6% * Weighted blended average
Quality Assurance ISO 9001: Quality Management System Certification ISO 14001: Environmental Management System Certification ISO 17025: Testing and Calibration Laboratories Certification UL: Japan Industrial Standard C.E.: Thailand Industrial Standard ISO: Australian Quality Accredited 12
13 Competitive Advantages Global competitors include Draka, Furukawa, Nexans, Prysmian, etc. Local competitors have advantages in sales, R&D spending or financial resources Competitors include both independent domestic and foreign suppliers Excellent customer service and knowledgeable sales and technical team Raw-material cost advantage over local producers Superior product quality and performance Reliable product supply and distribution Competitive Advantages Competitive Landscape First-mover advantage in key local markets
14 Growth and Expansion Strategy China Top growth opportunity for APWCC in the next few years Increase capacity to meet market demand and generate economies of scale Drive marketing penetration into Shandong, Henan, Guangxi Sichuan, and Chongqing city, etc. Develop new products and expand capacity Australia Upgrade production facilities to increase efficiency and capacity Increase product portfolio through offering imported products Thailand Develop new cable products for auto, solar or other types of alternative energy Upgrade and expand facilities for new government projects Control production cost Singapore Re-introduce Sigma's product to Southeast Asia market Bring complete solutions to our customers and improve customer responsiveness Explore new suppliers/partners in China for improved opportunities
15 History of Revenue Growth
Recovery in Gross Profit 16 $36.6 $57.3 $45.7 $12.8 $46.4 $32.0 $40.8 $0 $10 $20 $30 $40 $50 $60 $70 $ M099M10 USD Million 0% 2% 4% 6% 8% 10% 12% 14% Gross ProfitInventory AdjustmentGross Margin
17 Rebound in Net Income
18 Income Statement Year 12/31 (USD '000) month 2009 (Unaudited) 9 month 2010 (Unaudited) Total Sales$510,841$500,798$362,231$252,445$325,220 Cost of Sales465,165488,048315,840220,475284,401 Gross Profit45,67612,75046,39131,97040,819 Income from Operations 16,130(16,294)18,4599,72819,835 Income Before Taxes13,160(20,068)19,5729,65821,835 Net Income (Loss) attributable to APWC 4,833(13,649)10,0895,77811,082 Basic and Diluted Income (Loss) per Share (USD) $0.35($0.99)$0.73$0.42$0.80
19 Balance Sheet As of (USD ‘000)12/31/200812/31/ mon 2010 (Unaudited) Cash and Cash Equivalents$37,510$41,53450,098 Current Assets246,273239,048294,379 TOTAL ASSETS309,728296,052354,124 Bank Loans and Overdrafts(*)57,96237,18558,901 Other Current Liabilities87,88374,72477,751 Total Liabilities147,091113,460138,896 Total Shareholders’ Equity162,707182,592215,228 TOTAL LIABS and SHS’ EQUITY309,728296,052354,124 Current Ratio * Credit line of $280 million as of 12/31/2009.
20 Cash Flow (unaudited) As of (USD ‘000) mo mo Net Income (Loss)$4,833($13,649)5,77811,082 Depreciation9,0797,6464,8725,073 Allowance for Inventory Reserve (1,272)25,145(22,115)(1,157) Changes to Working Capital(3,601)46,55516,694(7,065) Cash Flows from Operations1,90660,0475,229(7,933) Purchases of PP&E(2,650)(3,383)(2,134)(2,614) Cash Flows from Investing(4,048)(5,156)9,022(6,974) Cash Flows from Financing3,951(44,452)(21,346)19,710 Net Increase in Cash and Equivalents 4,4638,383(5,539)8,564
21 Revenue and GP Analysis (unaudited)
22 Strong Management Team Andy C.C. CHENG – Chairman of the Board Mr. Andy C.C. CHENG was a member of the company’s Board of Directors from 2004 to 2005 and was re-elected in From 1987 to 2003, Mr. Cheng was the Vice President of procurement and later Executive Vice President and Chairman of the Investment division, all served at PEWC. Mr. Cheng was elected Chairman of the Board of APWC in October Chun Tang YUAN – Chief Executive Officer Mr. Chun Tang YUAN also serves as Chairman of PEWC since 2004 and has been the Director of Pacific Construction Corp. Ltd since He served as the Director of Taiwan Co-generation Corp from 2005 to Mr. Yuan is also the Chairman of Taiwan Electric Wire and cable Industries Association since He has served as the Supervisor to Taipei Importers/Exporters Association as well as the Director of Chinese National Federation of Industries in Taiwan since 1998 and 2004 respectively. Frank TSENG – Chief Financial Officer Mr. Frank TSENG has served as CFO since October Before joining APWCC, he was the deputy CFO for ABB Taiwan and, prior to that, the APAC regional controller for Phoenix Technologies, a Silicon Valley-based company that is publicly traded on NASDAQ. Mr. Tseng holds a Masters Degree of Accountancy from Georgia State University. He is also a CPA by the State of Illinois. Carson TIEN – Chief Operating Officer Mr. Carson TIEN serves as Chief Operating Officer since 2005 and has been with Pacific Electric Wire and Cable Group Companies since He started as engineer in PEWC's Tao Yuan plant in 1969 and later promoted to plant manager in 1977 and Assistant VP responsible for Engineering and Manufacturing in He transferred to APWC to head the Shenzhen plant in 1996 and was promoted to COO of APWC in Daphne HSU – Financial Controller Ms. Daphne HSU has been Financial Controller of the Company since March of 2005, prior to which she served as Financial Controller for ten years in Taiwan and China at a Thomson SA joint venture. Daphne graduated from National of Taipei College of Business with a major in accounting.
23 Experienced Board Members Anson Chan – Chairman of Audit Committee and Compensation Committee Member Mr. Anson Chan has been an independent member of the Company’s Board of Directors since 2007 and serves on the Audit Committee as its Chairman. He qualified as a CPA by the State of Illinois in U.S.A. in Mr. Chan is also a Managing Director of the Bonds Group of Companies and was a Senior Advisor to Elliott Associates from 2005 to Yichin Lee – Audit Committee Member Dr. Yichin Lee has been an independent member of the Company’s Board of Directors since 2007 and serves on the Audit Committee. Dr. Lee is also the Managing Director of Giant Management Consulting LLC and an independent director of Giga Media Limited. Dr. Yichin Lee holds a doctorate degree in resource planning and management from Stanford University. Dr. Yichin Lee is not related to Mr. Michael C. Lee or Mr. Gai Poo Lee.
24 Market leader in several regional markets Strong and growing underlying market demand Broad geographic coverage offers diversification Experienced and knowledgeable in-house sales and technical team Improving financial performance including a return to profitability Strong balance sheet, cash flow, and attractive valuation Investment Highlights
25 Corporate Structure—Appendix Sigma-Epan International Pte. Ltd. (Singapore) Pacific Electric Wire & Cable (SZ) Co., Ltd. (PRC) Crown Century Holding Ltd. (HK) Shanghai Yayang Co., Ltd. (PRC) Australia Pacific Electric Cable Pty. Ltd. (Australia) 100% Shandong Pacific Rubber Cable Co. Ltd. (PRC JV) Shandong Huayu Pacific Fiber Optics Comm. Co. (PRC JV) Shandong Pacific Fiber Optic Cable Co. Ltd. (PRC JV) 51.0%25.0%33.0% PRC(APWC) Holdings Ltd. (BVI) PRC(APWC) Holdings Ltd. (BVI) Ningbo Pacific Cable Co. Ltd. (PRC) Charoong Thai Wire & Cable Co. (Thailand) Pacific Thai Electric Wire & Cable Co., Ltd. Siam Pacific Electric Wire & Cable Ltd. Sigma Cable Company (Pte) Ltd. (Singapore) 98.3% Singapore China Thailand Australia Asia Pacific Wire & Cable Corp.. Ltd. (Bermuda) 100% 50.9% 100% Holding / Parent Company China (under restructuring) 16.0% Epan Industries Pte. Ltd. (Singapore) 100% 35.21%51.0%100% 13.79%
26 Contact Information Asia Pacific Wire & Cable Corporation Frank Tseng, Chief Financial Officer Phone: +886 (2) ext CCG Investor Relations John Harmon, CFA, Sr. Acct. Manager Phone: Ext Mr. Bryan Blake, MI Executive Phone: Legal Counsel Thompson Hine LLP Auditor Ernst & Young (Hong Kong)