ASIA OPTICAL

Investor Conference

August, 2006

2

Agenda• Welcome

• 1H06 Financial Results – Consolidated

• Q & A

3

Quarterly Result Highlights - ConsolidatedAmount: NT$ million 2Q '06 1Q '06 QoQ

Amount Amount %

Net Sales 6,310.97 5,152.57 22 % Net Income 425.53 291.89 46 %

EPS (NT$) - after tax 1.87 1.27 47 %

Cash and Financial Assets 6,322.11 5,915.26 7 % Interest-bearing Debts 2,244.81 2,252.34 0 % Shareholder's Equity - net 12,584.68 13,549.08 -7 %

4

Consolidated Income Statement - QoQAmount: NT$ million 2Q '06 1Q '06 QoQ

Amount % Amount % %Net Sales 6,310.97 100.0 5,152.57 100.0 22 % COGS (5,382.74) -85.3 (4,512.18) -87.6 19 % Gross Profit 928.23 14.7 640.39 12.4 45 % Operating Expense (398.36) -6.3 (312.21) -6.1 28 % Operating Income 529.87 8.4 328.18 6.4 61 % Net Non-operating Income (Exp.) 27.83 0.4 (7.04) -0.1 -495 % Income before Tax 557.70 8.8 321.14 6.2 74 % Income Tax Benefit (Exp.) (56.40) -0.9 (20.31) -0.4 178 %

(17.61) -0.3 (2.00) -0.0 781 % Minority Interest Loss (Income) (58.16) -0.9 (6.94) -0.1 738 % Net Income 425.53 6.7 291.89 5.7 46 %

EPS (NT$) - pre tax 1.97 1.30 52 % EPS (NT$) - after tax 1.87 1.27 47 %

Cumulative Effect of Changes in Accounting Principles

5

Consolidated Income Statement - HoH

* based on audited financial statement of 2005, the same shall apply in following slides

Amount: NT$ million 1H '06 1H '05 * HoHAmount % Amount % %

Net Sales 11,463.54 100.0 14,603.76 100.0 -22 % COGS (9,894.92) -86.3 (12,722.54) -87.1 -22 % Gross Profit 1,568.62 13.7 1,881.22 12.9 -17 % Operating Expense (710.57) -6.2 (739.16) -5.1 -4 % Operating Income 858.05 7.5 1,142.06 7.8 -25 % Net Non-operating Income (Exp.) 20.79 0.2 (18.64) -0.1 -212 % Income Before Tax 878.84 7.7 1,123.42 7.7 -22 % Income Tax Benefit (Exp.) (76.71) -0.7 (13.54) -0.1 467 %

(19.61) -0.2 0.00 0.0 -Minority Interest Loss (Income) (65.10) -0.6 (18.76) -0.1 247 % Net Income 717.42 6.3 1,091.12 7.5 -34 %

EPS (NT$) - after tax & retroactive adjustment 3.14 4.86

Cumulative Effect of Changes in Accounting Principles

6

Consolidated Balance Sheet & Key IndicesAmount: NT$ million 2006.06 2005.06 2004.06

Amount % Amount % Amount %

Total Current Assets 12,590.99 61.3 14,224.38 64.4 13,996.66 66.3

Cash & Financial Assets 6,322.11 30.8 5,924.53 26.8 5,613.40 26.6

Accounts Receivable 3,265.06 15.9 5,710.68 25.9 6,090.03 28.9

Inventory 2,100.87 10.2 1,990.40 9.0 1,702.40 8.1

Plants, Equipments & Properties 6,862.22 33.4 6,821.49 30.9 6,024.69 28.6

Total Assets 20,524.36 100.0 22,084.81 100.0 21,099.99 100.0

Total Current Liabilities 7,168.40 34.9 9,387.16 42.5 7,672.30 36.4

Accounts Payable 2,733.55 13.3 4,873.44 22.1 5,333.28 25.3

Loans & Bonds - current portion 2,244.81 10.9 2,658.99 12.0 873.41 4.1

Loans & Bonds - long-term 0.00 0.0 1,248.59 5.7 4,237.96 20.1

Total Liabilities 7,544.57 36.8 11,131.02 50.4 12,731.66 60.3

Total Stockholders' Equity 12,979.79 63.2 10,953.79 49.6 8,368.33 39.7

Key Indices

　 A/R Turnover Days 62.3 63.7 88.3

　 Working Capital 5,423 4,837 6,324

　 Current Ratio 1.76 1.52 1.82

　 Debt Ratio 36.76 50.40 60.34

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1H06 Consolidated Cash FlowsAmount: NT$ million 1H '06 1H '05 1H '04

Amount Amount AmountFrom Operation 932.14 781.25 663.40

Net Profit 717.42 1,091.12 956.09Depreciaton & Amortization 473.70 436.11 333.43Other Operating Cash Flows (258.98) (745.98) (626.12)

From Investment (638.51) (763.39) (2,085.87)Capital Expenditure (201.98) (554.95) (1,848.17)Financial Assets (289.37) 40.60 273.86L-T Investment (124.64) (151.84) (48.08)Other Investing Cash Flows (22.52) (97.20) (463.48)

From Financing (1,276.33) 155.62 500.68Cash Dividend 0.00 0.00 0.00Loans & Bonds (986.97) 155.13 501.50Treasure Stock (287.31) 0.00 0.00Other Financing Cash Flows (2.05) 0.49 (0.82)

Net Cash Inflows (Outflows) (982.70) 173.48 (921.79)

　　　　　　　　Asia　Asia　　　　　　　Optical　　　　　　Optical

Thank　YouThank　You

9

Safe Harbor Notice

We have made forward-looking statements in the presentation. Our forward-looking statements contain information regarding, among other things, our financial conditions, future expansion plans and business strategies. We have based these forward-looking statements on our current expectations and projections about future events. Although we believe that these expectations and projections are reasonable, such forward-looking statements are inherently subject to risks, uncertainties, and assumptions about us.

We undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events in the conference might not occur and our actual results could differ materially from those anticipated in these forward-looking statements.

95 年第二季法人說明會95年 8月

11

議　程• Welcome

• 95 年上半年財務報表• Q & A

12

合併季營運指標單位：新台幣百萬元 2Q '06 1Q '06 QoQ

　金 額 　金 額 %

營收淨額 6,310.97 5,152.57 22 %

稅後淨利 425.53 291.89 46 %

每股盈餘 (元) -稅後 1.87 1.27 47 %

現金及短期金融資產 6,322.11 5,915.26 7 %

附息負債 2,244.81 2,252.34 0 %

股東權益-淨額 12,584.68 13,549.08 -7 %

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合併損益比較 - QoQ單位：新台幣百萬元 2Q '06 1Q '06 QoQ

　金 額 % 　金 額 % %

營收淨額 6,310.97 100.0 5,152.57 100.0 22 %

營業成本 (5,382.74) -85.3 (4,512.18) -87.6 19 %

營業毛利 928.23 14.7 640.39 12.4 45 %

營業費用 (398.36) -6.3 (312.21) -6.1 28 %

營業淨利 529.87 8.4 328.18 6.4 61 %

淨營業外收入 (費用) 27.83 0.4 (7.04) -0.1 -495 %

稅前淨利 557.70 8.8 321.14 6.2 74 %

所得稅利益 (費用) (56.40) -0.9 (20.31) -0.4 178 % (17.61) -0.3 (2.00) -0.0 781 %

少數股權淨損 (淨利) (58.16) -0.9 (6.94) -0.1 738 %

稅後淨利 425.53 6.7 291.89 5.7 46 %

每股盈餘 (元) -稅前 1.97 1.30 52 %

每股盈餘 (元) -稅後 1.87 1.27 47 %

會計原則變動累積影響數

14

合併損益比較 - HoH

* 依據 2005年查核後之財務報表為準，以下投影片依此適用。

單位：新台幣百萬元 1H '06 1H '05 * HoH

　金 額 % 　金 額 % %

營收淨額 11,463.54 100.0 14,603.76 100.0 -22 %

營業成本 (9,894.92) -86.3 (12,722.54) -87.1 -22 %

營業毛利 1,568.62 13.7 1,881.22 12.9 -17 %

營業費用 (710.57) -6.2 (739.16) -5.1 -4 %

營業淨利 858.05 7.5 1,142.06 7.8 -25 %

淨營業外收入 (費用) 20.79 0.2 (18.64) -0.1 -212 %

稅前淨利 878.84 7.7 1,123.42 7.7 -22 %

所得稅利益 (費用) (76.71) -0.7 (13.54) -0.1 467 % (19.61) -0.2 0.00 0.0 -

少數股權淨損 (淨利) (65.10) -0.6 (18.76) -0.1 247 %

稅後淨利 717.42 6.3 1,091.12 7.5 -34 %

追溯調整後每股盈餘 (元) -稅後 3.14 4.86

會計原則變動累積影響數

15

合併資產負債表 & 主要指標比較單位：新台幣百萬元 2006.06 2005.06 2004.06

金　額 % 金　額 % 金　額 %

流動資產合計 12,590.99 61.2 14,224.38 64.4 13,996.66 66.3

現金及短期金融資產 6,322.11 30.7 5,924.53 26.8 5,613.40 26.6

應收帳款 3,265.06 15.9 5,710.68 25.9 6,090.03 28.9

存貨 2,100.87 10.2 1,990.40 9.0 1,702.40 8.1

固定資產淨額 6,862.22 33.4 6,821.49 30.9 6,024.69 28.6

資產總計 20,524.36 100.0 22,084.81 100.0 21,099.99 100.0

流動負債合計 7,168.40 34.9 9,387.16 42.5 7,672.30 36.4

應付帳款 2,733.55 13.3 4,873.44 22.1 5,333.28 25.3

借款 &公司債 -流動 2,244.81 10.9 2,658.99 12.0 873.41 4.1

借款 &公司債 -長期 0.00 0.0 1,248.59 5.7 4,237.96 20.1

負債總計 7,544.57 36.9 11,131.02 50.4 12,731.66 60.3

股權權益總計 12,979.79 63.1 10,953.79 49.6 8,368.33 39.7

主要指標　應收帳款週轉天數 62.3 63.7 88.3

　營運資金 5,423 4,837 6,324

　流動比率 1.76 1.52 1.82

　負債比率 36.87 50.40 60.34

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合併現金流量表比較單位：新台幣百萬元 1H '06 1H '05 1H '04

營運活動現金流量 932.14 781.25 663.40稅後淨利 717.42 1,091.12 956.09

折舊 & 各項攤銷 473.70 436.11 333.43

其它 (258.98) (745.98) (626.12)

投資活動現金流量 (638.51) (763.39) (2,085.87)資本支出 (201.98) (554.95) (1,848.17)

金融資產處分 (購買) (289.37) 40.60 273.86

長期股權投資增加 (124.64) (151.84) (48.08)

其它 (22.52) (97.20) (463.48)

融資活動現金流量 (1,276.33) 155.62 500.68現金股利 0.00 0.00 0.00

銀行借款增加 (償還) (986.97) 155.13 501.50

庫藏股票買回成本 (287.31) 0.00 0.00

其它 (2.05) 0.49 (0.82)

淨現金及約當現金增加 (減少) (982.70) 173.48 (921.79)

　　　　　　　　Asia　Asia　　　　　　　Optical　　　　　　Optical

Thank　YouThank　You

18

Safe Harbor Notice

We have made forward-looking statements in the presentation. Our forward-looking statements contain information regarding, among other things, our financial conditions, future expansion plans and business strategies. We have based these forward-looking statements on our current expectations and projections about future events. Although we believe that these expectations and projections are reasonable, such forward-looking statements are inherently subject to risks, uncertainties, and assumptions about us.

We undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events in the conference might not occur and our actual results could differ materially from those anticipated in these forward-looking statements.