30th Anniversary

Letter to Shareholders

Dear Shareholders,

In 2022, the COVID-19 epidemic came to an end, but during the epidemic, the electronics industry had overstock at all levels of the supply chain due to poor supply. In particular, the desktop computer market saw its global shipment decline by 16% last year compared to the previous year, resulting in inventory depletion of the entire supply chain. Fortunately, the trend of using edge computing devices was clear, and the accompanying demand for driving sensors, networking products, and terminal servers increased. FSP also made up for the decline in the PC market with the growth of industrial computers, networking computer power supplies, and server power supplies. The overall revenue of FSP was 14.9 billion, which decreased by 10% compared to the previous year, and the number was nearly 19.57 million. More than 60% of them were power supplies for networking and industrial computers. The results of operations in 2022 and the business outlook for 2023 are explained below:

I. Results of Operations in 2022

(I) Business Plan Implementation Results

FSP's consolidated revenue for 2022 was NT$14,941,451 thousand, a decrease of 10% compared to consolidated revenue of NT$16,650,252 thousand for 2021; the net income before tax for 2022 was NT$951,767 thousand, a decrease of 1% compared to net income before tax of NT$960,600 thousand for 2021; net income after tax for 2022 was NT$789,621 thousand, an decrease of 1% compared to net income after tax of NT$801,279 thousand for 2021; basic earnings per share before and after tax for 2022 were NT$4.54 and NT$3.85, respectively.

Unit: NT$ thousands; %
Item 2022 2021 Change, by Amount Change, by Percentage
Operating Revenue 14,941,451 16,650,252 (1,708,801) (10.26%)
Gross Profit 2,308,783 2,424,205 (115,422) (4.76%)
Operating Income 542,320 671,909 (129,589) (19.29%)
Non-Operating Income and Expenditures 409,447 288,691 120,756 41.83%
Net Income Before Tax 951,767 960,600 (8,833) (0.92%)
Net income After Tax 789,621 801,279 (11,658) (1.45%)

(II) Budget Implementation Status

The Company did not formulate a financial forecast for 2022.

(III) Analysis of Financial Gains and Losses and Profitability

Unit: NT$ thousands; %
Item
Year
2022 2021 Percentage of Increase (Decrease)
Financial Revenue and Expenditures Operating Revenue 14,941,451 16,650,252 (10.26%)
Gross Profit 2,308,783 2,424,205 (4.76%)
Net Profit After Tax 789,621 801,279 (1.45%)
Profitability Analysis Return on total assets (%) 3.88 4.00 (3.00%)
Return on equity (%) 5.79 6.40 (8.10%)
Ratio of income before tax to paid-in capital (%) 50.83 51.30 (0.92)%
Net profit margin (%) 5.28 4.81 9.77%
Earnings Per Share (NT$) 3.85 4.03 (4.47%)

(IV) Research and Development

The results of R&D in 2022 were as follows:
  • Compact ATX 750/850/1000/1200W.
  • Efficient Titanium 850/1KW ATX power supply, plan for MP in 2023/Q1.
  • Development of power supply to support the ATX 12Vo platform developed by Intel and meet new energy efficiency requirements.
  • Research and develop Titanium 1.3/1.6KW products.
  • High-wattage SFX 1KW power supply plan for MP in 2023/Q1.
  • Compact PD 30~65W lipstick machine series products.
  • PD 3.1 140W 28V output models.
  • ATX 250~500W power supply of ATX 3.0.
  • CRPS 2400W and 3000W high-power density devices.
  • Completed CRPS modularized back panel and entry-level housing to meet the high-mix low-volume demand for edge computing: FC210C.
  • Iterative design for 65W @ 2" x 4" series.
  • Iterative design for 150W @ 2" x 4" series.
  • Iterative design for 200W @ 3" x 5" series.
  • 100W @ 2.44”x 6.1 series power supply for industrial applications.
  • 150W @ 3”x 6.3 series power supply for industrial applications.
  • 700W ATX PC Power.
  • mass production of IP67 600W/completing appearance design of 2000W On Board/Off Board Charger.
  • UDS automobile communication software development is completed.
  • Continuous development of 3300W On Board Charger for cooling module.
  • 3KW mobile energy storage - 800W/2.6KWh.
  • Stationary energy storage system - 10KW Off-grid ESS; 30KW Hybrid ESS.
  • Lithium iron phosphate battery module - 48V low voltage version.

II. Summary of 2023 Business Plan

Looking ahead to 2023, based on the remote network working habits formed by the COVID-19 pandemic, the demand for network communication equipment, exchanger, server power is still strong, the development trend of AI is clear, and the demand for related sensors, graphics and high-speed computing computers increases rapidly. For networking, high-speed computing, server power, unbranded CRPS power supply, FSP has a complete product line and will continue to lay out and launch relevant products to meet the market. In addition, the desktop computer market downturn in the past two years is expected to improve after inventory reduction this year. FSP's power supply in esports and desktop computer will actively participate in the market. The overall target for total sales of power supply units is 20.9 million units.

III. Future Development Strategy

FSP is committed to its corporate mission of "maximizing value for customers, employees, and shareholders with innovative services and high-quality products". Continuously research and develop advanced technology, develop power sources for innovative industries, to provide high value added power products. In recent years, the awareness of sustainability raised, ESG-compliant products and services will be the first choice of the market and customers, FSP will invest more and better R&D resources to build efficient power supply products to meet the market demand for durability and efficiency requirements. Product applications are particularly focused on the large number of information flow devices, production sensors networking servers and edge computing AI devices, which contribute significantly to power consumption reduction.

IV. Impact of the External Competitive Environment, Regulatory Environment, and Overall Business Environment

FSP has set up the Sustainable Development Committee under the jurisdiction of the Board of Directors. Concerning current domestic and foreign laws and regulations that govern our operations, and our management team will continue to pay close attention to policies and laws on corporate governance issues that may affect the Company's financial and business. We shall provide guidance and review environmental issues related to the environment between operations and production, and social issues related to coexistence and mutual prosperity with society and stakeholders on all levels.

FSP is committed to protecting the environment with green energy, respecting customers, and creating a high-quality work environment. We seek to become the most reliable partner for customers, consumers, suppliers, and employees and maximize value for customers, shareholders, and employees.

I wish you good health and prosperity
Chairman: Cheng, Ya-Jen
hi this is over contact us
item is select