Stock Code: 2458
ELAN MICROELECTRONICS CORP.
ANNUAL REPORT 2023
EMC Annual Report is available at: https://mops.twse.com.tw
TABLE OF CONTENTS
I. | Letter to Shareholders | 1 |
- Company Profile
1. | Date of Incorporation | 4 |
2. | Company History | 4 |
- Corporate Governance Report
1. | Organization | 8 |
2. | Directors, Supervisors and Management Team | 11 |
3. Remuneration Paid to Directors, Supervisors, President and Vice President in Last Fiscal Year……………………………………………………………………………………….. 18
4. | Implementation of Corporate Governance | ………. | 26 |
5. | Audit Fee Information | 81 | |
6. | Information Regarding the Change of Accountant | 83 | |
7. | The Company's Chairman, President, Chief Financial Officer or Chief Accounting Officer | ||
Who Has Worked For The CPA's Firm or Its Affiliates During The Last Fiscal Year | 84 |
8. Any Transfer of Shareholdings And Changes In Equity Pledge From The Directors, Managers And Shareholder(S) Holding More Than 10% of The Shares During The Last Fiscal Year and
Until The Publishing Date of The Annual Report | 84 |
9. Information Regarding The Relationship Between The Related Parties Identified In No.6 | |
Of The Financial Accounting Standards and Among The Top 10 Shareholders | 85 |
10. The Number of Shares Held By The Company, The Company's Directors, Supervisors, Managers, and Businesses Directly or Indirectly Controlled By The Company In The Same
Joint Venture, and The Combined Shareholding Percentage | 86 | |
IV. Capital Overview | ||
1. | Capital and Shares | 87 |
2. | Corporate Bonds | 93 |
3. | Preferred Stocks | 93 |
4. | Global Depositary Receipt | 93 |
5. | Employee Stock Options | 93 |
6. | Status of New Shares Issuance in Connection with Mergers and Acquisitions | 93 |
7. | Funding Plans and Implementation | 93 |
V. Operating Highlights | ||
1. | Business Activities | 94 |
2. | Market and Sales Overview | 102 |
3. | Human Resources | 110 |
4. | Environmental Protection Expenditure | 111 |
5. | Labor Relations | 112 |
6. Information Security Management……………………………………………………… .. 115
7. | Important Contracts | 117 |
VI. Financial Information | ||
1. | Five Year Financial Summary | 119 |
2. | Five Year Financial Analysis | 123 |
3. | Audit Committee's Review Report | 127 |
4. | Financial Statements of the Last Fiscal Year | 127 |
5. | Last Fiscal Year's Parent-Subsidiary Consolidated Financial Statements and Independent | |
Auditors' Report | 198 | |
6. | Financial Difficulties of the Company and its Affiliates During the Last Fiscal Year and | |
Until the Publishing date of the Annual Report | 280 | |
VII. Review of Financial Conditions, Financial Performance, and Risk Management | ||
1. | Analysis of Financial Status | 281 |
2. | Analysis of Operating Results | 282 |
3. | Analysis of Cash Flow | 284 |
4. | Major Capital Expenditure Items on the Financial Operations during the Last | |
Fiscal Year | 285 | |
5. | Investment Policy in Last Year, Main Causes for Profits or Losses, Improvement Plan | |
Thereof and the Investment Plan for the Coming Year | 286 | |
6. | Analysis of Risk Management and Assessment | 287 |
7. | Other Important Matters | 292 |
VIII. | Special Disclosure | |
1. | Summary of Affiliated Companies | 293 |
2. | Private Placement Securities During the Last Fiscal Year and Until the Publishing | |
Date of the Annual Report | 300 | |
3. | The Shares in the Company Held or Disposed of by Subsidiaries During the Last Fiscal | |
Year and Until the Publishing date of the Annual Report | 300 | |
4. | Other Necessary Supplementary Explanations | 300 |
IX. Any matter that has material effect on the shareholders' equity or the price of securities | ||
as set out in section 2, paragraph 3, Article 36 of the Company Act During the Last Fiscal | ||
Year and Until the Publishing date of the Annual Report | 301 | |
Statement of Internal Control System | 302 |
- Letter to Shareholders Dear Shareholders,
1. 2023 Operating Results
In 2023, the global economy continued to face numerous challenges, including prolonged inflation, the ongoing stalemate in the Russia-Ukraine conflict, slowing down the infrastructure development and the economic growth in mainland China, and the escalating geopolitical conflicts in the Middle East. These concerns have led to significant obstacles in global economic development, subsequently weakening the purchasing power of consumers worldwide.
Certainly, the global market for consumer electronics, including the laptop market, has also been affected by weak demand. It is estimated that the annual shipment volume will decrease by double digits, dropping to 174 million units. Due to the Company's heavy reliance on specialized chips for laptop-related products, we have been similarly affected. This has resulted in a 7.46% decrease in revenue for the year, with profits after tax also falling below those of 2022.
Global laptop manufacturers adopted conservative demand planning in 2023, mainly due to the lingering effects of high inventory levels from previous years since 2022. As a result, much of the year was spent on destocking efforts. Even though inventory levels for laptop brands and their supply chains gradually returned to normal in the latter half of 2023, subdued demand in end markets post-pandemic led brand manufacturers' customers to supplement their basic orders with rush orders to meet market demand. Looking back over the whole year, despite external disruptions causing early challenges in our operations, the Company benefited from a spirit of long-term dedication and continuous innovation in product development. As a result, each product line still delivered an outstanding performance.
The Company continued to deepen its efforts in developing more optimized products, aiming to provide brand customers with greater market competitiveness. In 2023, we completed the development of several products, including: direct current brushless motor control chips; active pen control chips supporting various protocols for touch screen pens; precise touch screen chips for mobile phones; solutions supporting single-layer external touch screen displays; fingerprint recognition system solutions for preventing fingerprint spoofing attacks and capacitive pressure sensing and haptic feedback touch screen solutions.
In 2023, the Company's related product lines have successfully continued to regain global market share. Within the touch screen module sector, the market's clear direction towards increasing the size of touch screen modules and incorporating haptic feedback technology presents significant potential for the performance contribution of our products. The touch screen chip segment has benefited from new licensed collaborations involving pen solutions and market entry into Single Layer On-Cell (SLOC) touch panels. This positions the Company to lead deeper into the high-end laptop market and expand the application of touch screen chips into more diversified technology fields. Despite facing headwinds in the overall economy in 2023, biometric devices encountered setbacks. However, their trend towards lighter and slimmer designs has brought stability to the Company's profit margins. Our fingerprint recognition market share currently ranks second globally. However, due to ongoing customer promotion of Match-On-Chip (MOC) technology, the Company is fully committed to aligning with customers' product shipment plans.
1
In 2023, the consolidated revenue reached 12.059 billion New Taiwan Dollars, with an impressive gross profit margin of 45%. The consolidated operating net profit margin stood at 20.2%. The net profit after tax of the parent Company amounted to 2.143 billion New Taiwan Dollars.
2. Summary of the Business Plan for 2024
Entering 2024, inflation has gradually eased since the end of 2023. Although the global economic growth rate remains subdued, consumer spending is expected to increase due to the continued decline in unemployment rates. In the laptop market, Microsoft is expected to launch the Windows 12 operating system this year. Additionally, they have indicated the possibility of discontinuing updates for the Windows 10 operating system by 2025. This move is anticipated to trigger a new wave of device upgrades. Furthermore, brand manufacturers are actively investing in the development of AI-powered PCs, aiming to inject innovation into the laptop market.
According to Omdia's estimation, the shipment volume of notebook computers in 2024 is expected to increase by single digits annually, with a total shipment volume forecasted to reach 186 million units. Considering that the destocking actions in the notebook computer supply chain have reached the final stage, and brand manufacturers' purchase order plans for 2024 are expected to return to normal, despite the ongoing uncertainties in the overall economy, the Company believes that through our dedication to the laptop industry and efforts to expand new product technologies and applications, we can continue to improve overall operational performance amidst fluctuations.
In 2024, AI-powered PCs will truly begin to ferment, and the increase in their technological content will further drive the growth in chip value, injecting new momentum into the Company's growth and operations. In the initial stages of development, the focus will be on strengthening existing technological levels, while simultaneously discussing future potential development directions with customers. The aim is to enhance consumer user experience by developing corresponding technological projects. We have a long-term optimistic outlook on its development prospects.
In 2024, the anticipated completed product developments include: AI touchpad with anti-palm touch and waterproof solutions; AI touch screen with active pen tracking, synchronous display, anti-palm touch, and waterproof solutions; Fingerprint recognition application solution for AI- powered PCs; Pressure sensing and haptic feedback driving chips for NB touch pads; Area dimming control chips for automotive displays; Integrated touch driver chips for automotive displays. Additionally, technologies e.g. haptic feedback, SLOC, etc., will be introduced and expanded upon. Long-term improvements and optimizations will be made to enhance both price and technical capabilities. There is also an opportunity to drive average prices upwards, thus benefiting the operational performance of related laptop products.
In addition to laptop products, the Company will also focus on developing the ADAS (Advanced Driver Assistance Systems) and smart cockpit solutions. We will collaborate with affiliated companies e.g. Chimei Motor Electronics Co., Ltd. and Avisonic Technology Corporation to jointly develop algorithms and propose automotive solutions. We expect showcasing the operational performance of these endeavors this year.
2
The Company adheres to the principle of deepening core technologies and holds on to the concept of developing integrated systems to provide customers with solutions that possess world-class competitiveness. Furthermore, we are committed to conducting business through an approach that embraces sustainability, actively fulfill corporate social responsibility, and pursue a steady and long-term development strategy aimed at enhancing the operational results and profitability of the group. With the aim of enhancing both the business and social value of our enterprise, we are dedicated to promoting our influence across three dimensions: economic, environmental, and social. By doing so, we seek to create greater value and well-being, ultimately giving back to all stakeholders involved.
Sincerely yours,
Yeh, I-Hau
Chairman
3
- Company Profile
- Date of Incorporation: May 5, 1994
- Company History
Year | Organization /Events/Products | Corporate Governance Awards and Ratings |
2023 | International Organization for | Granted an ISO 14064-1 Greenhouse Gas Inventory |
Standardization | certification statement in 2022 | |
Computex Taipei 2023 | The Company's AI Automated Lane Keeping Assist (LKA) | |
and Forward Collision-Avoidance Assist (FCA) System for | ||
autonomous buses won the "Vehicle Technology and Smart | ||
Cockpit Category Award" at the Best Choice Award at the | ||
Computex Taipei 2023 | ||
Ministry of Economic Affairs | The 8th National Industrial Innovation Award for Outstanding | |
(MOEA) | Innovation Enterprises | |
2022 | Ministry of Economic Affairs | A+ Enterprise Innovation Research and Development Plan |
(MOEA) | Award for its successful promotion of the | |
Environmental Sensing Advanced AI Driver Assistance | ||
System (ADAS) and Intelligent Cockpit System Development | ||
Program | ||
China Credit Information Service, | The 10th place in the Taiwan Large Enterprises' Ranking of | |
Ltd. (CRIF, Taiwan) | TOP 5000 - Integrated Circuit Design Industry in 2022 | |
Industrial Safety and Health | 2022 Gold Award of disaster-free working hour Record | |
Association (ISHA), R.O.C. | Activities of Public Institutions | |
2021 | Hsinchu Science Park | R&D Achievement Award |
Outstanding Manufacturer - Innovative Product Award | ||
Sports Administration of the | Won the "2021 i Sports Enterprise Certification" seal awarded | |
Ministry of Education | by the | |
Digital Times Magazine | 2020 Top 100 Taiwan's High-Value Companies - 4th place | |
Commonwealth Magazine | World's Most Admired 2000 Companies Top 50 - 18 place | |
2020 | Digital Times Magazine | 2019 Top 100 High-Value Companies - 7th place |
Forbes | Best Companies Under a Billion in Asia | |
Hsinchu Science Park | Outstanding Prize in Greening and Beautification Contest | |
CSR Committee | Renamed as "ESG Committee", it is the highest-level | |
sustainable development decision-making center within the | ||
Company, examining the Company's core operating | ||
capabilities and establishing medium - and long-term | ||
sustainable development plans. | ||
2019 | ISO | Certification of ISO 45001: 2018 Occupational Health and |
Safety Management Systems. | ||
Taipei International Information | Best Choice Award for the "Panoramic 360-Degree Fisheye | |
Technology Show (the | AI Smart Traffic Detection Technology". | |
"COMPUTEX Taipei") | ||
Workforce Development | Silver medal the Talent Quality-management System (TTQS) | |
Agency/Ministry of Labor (MOL) | Award | |
SGS | SGS's 2019 "ISO Plus Award" | |
Health Promotion Administration | Innovation Workplace Award and the Creative Healthy | |
of the Ministry of Health and | Workplace Award | |
Welfare | ||
Hsinchu Science Park | Smart Science Park Innovation Application Award - | |
"Battery-Free Contactless Biometric Smart Card Solution" | ||
2018 | Taiwan Industrial Technology | Taiwan Golden Root Award - Industrial Technology Special |
Association | Contribution Award | |
Hsinchu Science Park | Distinguished Green Landscaping and Contribution Award | |
2018 R & D Achievement Award | ||
2018 Innovative Product Award | ||
Health Promotion Administration | "Excellent Health workplace" prize and "Gender-Friendly | |
of the Ministry of Health and | Health Award" | |
Welfare | ||
2017 | Hsinchu Science Park | Distinguished Green Landscaping and Contribution Award. |
Consumer Electronic Product | Top 100 Innovative Product Award-Biometric Smart Card | |
Category of 2017 IT Month. | ||
4 |
Hsinchu Science Park | 2017 Innovative Product Award -Pen-EmulatedFinger-Pen - | |||||
Concurrent Touch Screen Solution | ||||||
2016 | Hsinchu Science Park | Distinguished Green Landscaping Award | ||||
2016 R & D Achievement Award | ||||||
2016 Innovative Product Award - Smart-ID Solution | ||||||
2015 | SGS | Obtained certification for the Corporate Social | ||||
Responsibilities | Report | and | adopted | international | ||
certifications of AA1000 AS Type 2 Moderate-Level | ||||||
Assurance and GRI G4 | ||||||
Hsinchu Science Park | Distinguished Green Landscaping Award | |||||
2015 R & D Achievement Award | ||||||
Innovative Product Awards - Chrome book Smart Touch pad | ||||||
and Touch Screen Solution | ||||||
Health Promotion Administration, | Vitality Award in the "Healthy Workplace Health Promotion" | |||||
Ministry of Health and Welfare. | ||||||
2014 | Hsinchu Science Park | Distinguished Green Landscaping Award for the 10th | ||||
consecutive year | ||||||
R & D Achievement Award | ||||||
ESG | In accordance with the vision and mission of the Company's | |||||
ESG policy, the "CSR Committee" was established | ||||||
2013 | Ministry of Economic Affair | Portable Product with 3D Depth Sensor for Hand Gesture | ||||
Recognition - Leading Program | ||||||
Corporate Standardization Award in the 14th National | ||||||
Standardization Award | ||||||
Forbes | One of the 2013 Forbes Best Companies Under a Billion in | |||||
Asia | ||||||
Windows | IT Month's "Gold Award" and "Top 100 Innovative Product | |||||
Award"-Windows 8 Single-Chip Smart Touch Screen | ||||||
Solution | ||||||
Hsinchu Science Park | 2013 R & D Achievement Award | |||||
2013 Innovative Product Awards - Windows 8 Single-Chip | ||||||
Smart Touch Screen Solutions | ||||||
Industrial Development Bureau, | 2nd Term Excellent Backbone Enterprises Award | |||||
MOEA. | ||||||
2012 | COMPUTEX Taipei. | Golden Award - Smart-Touch screen™ IC; | ||||
The Best Choice Award - Best Choice of the Year | - IC & | |||||
components product category | ||||||
2011 | Ministry of Economic Affairs | Awards - Capacitive Touch Screen with Force Sensing | ||||
Program from the "Leading Program" | ||||||
Hsinchu Science Park | 2011 Innovative Product Award - Capacitive 10-Finger Touch | |||||
Screen and Stylus | ||||||
2010 | USA's 2010 Consumer Electronics | Innovative Design and Engineering Award - Smart Remote | ||||
Show. | Control | |||||
Capacitive Multi-Finger Touch | 13th Outstanding Photonics Product Award | |||||
Screen and Stylus | ||||||
Hsinchu Science Park | Awards for the "Optical System Integration Chip Plan with | |||||
High Recognition Rate and Wide Dynamic Range" - Research | ||||||
on Policy of University-Industry Collaboration for Enhancing | ||||||
Sustainable Growth for NSC Science Park | ||||||
2010 R & D Achievement Award | ||||||
2010 Innovative Product Awards - Smart-3D Remote Control | ||||||
2009 | COMPUTEX Taipei | Best Choice Award | ||||
Annual Award - Transparent Touch pad | ||||||
Excellence Award in the peripheral and accessories category - | ||||||
Transparent Touch pad | ||||||
Excellent Digital Entertainment Product Award - Smart | ||||||
Remote Control | ||||||
Ministry of Economic Affairs. | Awards for the "Portable Soft-FilmMulti-Touch Surface | |||||
Capacitive Module Program" from the "Industrial Technology | ||||||
Development Program" | ||||||
Outstanding Innovation Award in the 17th Industrial Science | ||||||
5 |
and Technology Development Award | ||
2009 IT Month | 2009 IT Month's Outstanding Information Application and | |
Products Award - Smart Remote Control | ||
Ministry of Economic Affairs | the 10th Industrial Excellence Award | |
Hsinchu Science Park | 2009 Innovative Product Awards -Smart Remote Control | |
2009 R & D Achievement Award | ||
2009 Promotion of International Exchange and Cooperation | ||
Award for Excellence | ||
Outstanding Award -2009 Environmental Protection | ||
Competition | ||
2008 | Hsinchu Science Park | 2008 Innovative Product Award |
ELAN Microelectronics | Officially merged with Elantech Devices in 2008. | |
2007 | Hsinchu Science Park | Distinguished Green Landscaping Award for the 7th |
consecutive year. | ||
Ministry of Economic Affairs. | Contribution Award in the "2007 National Invention and | |
Creation Award" | ||
2006 | Hsinchu Science Park | Distinguished Green Landscaping Award for the 6th |
consecutive year. | ||
Industrial Development Bureau, | Received a subsidy from the consultation program for the | |
MOEA | development of leading new products ("Leading Product") | |
Hsinchu Science Park | 2006 Innovative Product Award | |
2005 | Hsinchu Science Park | Distinguished Green Landscaping Award for the 5th |
consecutive year | ||
Third Term R & D Achievement Award | ||
2004 | Hsinchu Science Park | Distinguished Green Landscaping Award for the 4th |
consecutive year | ||
Innovative Technology R & D Program Awards - | ||
TFT LCD single-chip controller | ||
Innovative Technology R & D Program Awards - | ||
2.45GHz RF Transceiver IC for Cordless Phones | ||
Department of Industrial | Outstanding Award in the 12th "MOEA Industrial Science and | |
Technology, MOEA | Technology Development Award" | |
Forbes | Recognized by Forbes as one of the "100 Best Small Asia- | |
Pacific Companies" in 2003 | ||
Hsinchu Science Park | R & D Achievement Award - 2nd place | |
2003 | Entered into the European market | Established ELAN's European branch office in Switzerland. |
Hsinchu Science Park | Distinguished Green Landscaping Award for the 3rd | |
consecutive year | ||
Entered southern China market | Established Elan Shenzhen Co., Ltd. | |
Hsinchu Science Park | Distinguished Green Landscaping Award for the 2nd | |
consecutive year | ||
Forbes | Recognized by as one of the 200 Top Best Small Companies | |
Entered the eastern China market | Established Elan Shanghai, Ltd. | |
2001 | Elan Microelectronics | The construction of the ELAN Technology Building located |
on No. 12, Chuangxin 1st Road has been completed and the | ||
Company Elan Microelectronics was officially moved into | ||
this building. | ||
Hsinchu Science Park | Distinguished Green Landscaping Award | |
Securities and Futures Commission, | Approved to be listed and to trade its stocks in the exchange | |
Ministry of Finance | market (stock code: 2458). | |
National Invention Competition | Gold Medal Award in the 10th National Invention Competition | |
ISO | Passed ISO9001 quality certification | |
Hsinchu Science Park | 2001 Innovative Product Award | |
Forbes | Recognized by Forbes as one of the 200 Top Best Small | |
Companies | ||
Entered the eastern China market | Established Elan Shanghai, Ltd. | |
2000 | Securities and Futures Commission, | Approved to be listed and to traded its stocks over the counter |
Ministry of Finance | (stock code: 5433) | |
1999 | Hsinchu Science Park | 1999 Research and Development Investment Award |
1998 | Industrial Development Bureau, | 1998 Excellent Intellectual Property Management System |
MOEA. | Award | |
6 |
1997 | National Invention Competition | Corporate Silver Medal in the 6th National Invention Prize |
To expand markets and marketing | Established ELAN Microelectronics Hong Kong branch office | |
bases in Hong Kong and mainland | to expand markets and marketing bases in Hong Kong and | |
China. | mainland China. | |
1996 | Hsinchu Science Park | Innovation, Technology, Research and Development Plan |
Awards- | ||
The high-speed computer screen controller | ||
Innovation, Technology, Research and Development Plan | ||
Awards- | ||
The MPEG-2 video decoder | ||
Innovation, Technology, Research and Development Plan | ||
Awards- | ||
The MPEG-2 audio decoder | ||
1996 Research and Development Investment Award | ||
1995 | Hsinchu Science Park | Key Components and Products R & D Plan Awards- |
The neural network IC series and development system | ||
1994 | Establishment of Elan | The registered and paid-up capital amounting to NT$1 billion |
Microelectronics Corporation | ||
Hsinchu Science Park | Issued the Business Registration Certificate and the Company | |
officially commence its operations |
7
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
Elan Microelectronics Corp. published this content on 16 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 16 May 2024 12:21:07 UTC.