Spokesperson : Acting Spokesperson : Global Headquarters ......Lite-On Technology was given the HP...
Transcript of Spokesperson : Acting Spokesperson : Global Headquarters ......Lite-On Technology was given the HP...
Spokesperson :Andrew LinChief Financial OfficerTel : 886-2-8798-2888e-mail : [email protected]
Acting Spokesperson :Ancel LeeVice President Finance DivisionTel : 886-2-8798-2888e-mail : [email protected]
Global Headquarters :No. 392, Ruey Kuang Road, Neihu Taipei 114, Taiwan, R.O.C.Tel : 886-2-8798-2888
Major Factory in Keelung :No. 14, Wu-Shin Street, Ta-Wu-Lung Industrial ZoneKeelung City 204, Taiwan. R.O.C.Tel : 886-2-2433-3333
Stock Affairs Department :1F, No. 392, Ruey Kuang Road, NeihuTaipei 114, Taiwan, R.O.C.Tel : 886-2-8798-2888www.liteon.com
Auditors :Clark Chen and James Wu Deloitte & Touche12F, No. 156, Sec. 3, Min-Sheng E. Road, Taipei 105, Taiwan, R.O.C. Tel : 886-2-2545-9988www.deloitte.com.tw
GDR and related information :Citibank, N.A.www.citibank.com/adr
Lite-On Technology Corporation website :www.liteon.com
21
03
13
17
26
27
28
28
29
30
35
49
50
50
51
52
53
63
68
05
11
33
61
Management Philosophy
Letter to Shareholders
Corporate OverviewCompany Prof i le
Organizat ion
Issuance of Corporate Bonds
Preferred Shares Status
Issuance of Global Depositary Receipts (GDRs)
Employee Stock Opt ion
Merger and Acquis i t ion
Introduct ion of L i te-On Cultural Foundat ion
Operational HighlightsBusiness Overv iew
Personnel Growth over the Last Two Years
Environmental Protect ion Expenditures
Labor Relat ions
Important Contracts
Major Legal Proceedings and Cont ingencies
Assets Acquis i t ion or Disposit ion
Financial InformationF inancia l Histor ica l Summary
Audited F inancia l Statements
C o n t e n t s
This annual report contains excerpts from the Chinese version of Lite-On Technology Corporation’s 2003 annual report, which was printed on April 30th, 2004 and published in accordance with “the Regulations of the Criteria Governing Information to be published in Annual Company Reports in the Republic of China.“ For more information, please refer to the Chinese version of the Company’s annual report.
3 4
VisionA World-Class Company Striving for Excellence
Business scale : exceeding US$8 billion in terms of revenues.
Leadership : being the absolute No. 1 position in the global market.
Profitability : reaching the “A” standard of the industry.
Corporate governance : realizing “transparency” ”independence” and “Fairness”.
Corporate citizenship : achieving “globalization” ”environmental protection” and “Societal responsibility”.
MissionShort-term : leading position for Optoelectronic components in Asia.
Long-term : global leader in digital integrated products.
StrategyGrowth : striving for competitive edge in the fast-growing markets.
Value : providing customers with differentiated products and technologies.
Stability : continuing to generate excellent profits and cash flows.
Lite-On Value Customer Satisfaction
Excellent in Execution
Innovation
Integrity
Business Philosophy
LITE-ON THE WORLD
5 6
R e p o r t t o S h a r e h o l d e r s
Becoming one of Multi-trillion corporations after the first year of merger
The year of 2003 was the first year after the four-in-one merger of Lite-On Technology. Thanks to the team efforts made by all of our colleagues as well as the encouragement and support from our shareholders, the consolidated global revenue of the Company, including the two major subsidiaries of Lite-On IT and Silitech with more than 50% shares held by the Company, reached NT$144.729 billion, of which the revenue of the parent company in Taiwan also reached NT$99.668 billion.
In terms of profits, the Company also earned and achieved a before-tax net income of NT$8.348 billion and after-tax earnings of NT$7.281 billion. This achievement enabled Lite-On Technology to rank among the top ten electronic companies of Taiwan for the year of 2003, and allowed Lite-On Technology to be honorably ranked the 61st in U.S. Business Week Global IT 100.
Besides the outstanding achievement in sales, Lite-On also achieved impressive results in its overall business performance. During the year of 2003, 85% of sales made by Lite-On Technology were contributed by products that were ranked top six in the world with respect to each of its global market share. Among which, the three product categories of Power, Image and Modem products were ranked top three in the world while Digital Display and LED products were ranked top six in the world.
Furthermore, after the four-in-one merger, thanks to the integration of procurement, information, sales and accounting departments that the raw material costs decreased substantially while the business efficiency increased, which has been highly recognized by our customers.
Lite-On Stands As the Leading Supplier of Optoelectronic Components
Through the first year of merger, the overall business performance of Lite-On Technology is gradually improved. Looking into the year of 2004, we estimate that the consolidated global revenue for this year will exponentially grow by over 40% compared to that of last year; targeting at the Company's product structure and market share, Lite-On Technology will position optoelectronic components as our main products to further display Lite-On Technology's leading position in Taiwan in the fields of LED, Power Supply, Digital Display, and Image products. In total the aforesaid four major types of products that relate to optoelectronic components will contribute to more than 80% of Lite-On's overall revenues.
Lite-On Technology has been devoted to vertical integration, that is, to provide a complete and multiple integration for components, modules, and systems, and has significantly contributed to Lite-On Technology's current growth. Besides products related to optoelectronic components, it is highly expected that mobile phone products and computer systems will become the next development target for next stage as the economic scale increases.
Dear shareholders,
On November 4, 2002, Lite-On Technology Corporation set the first example in Taiwan's securities history by the merger of four listed
companies, and kept the stock code of 2301 of Taiwan's first listed electronics company, Lite-On Electronics Inc. "New Lite-On" not
only symbolizes the entrepreneurial spirit of the first listed company in Taiwan's information technology industry, but also sets a new
milestone for the integration of Taiwan's high-tech industry to work toward the next climax.
7 8
"Customer First" as our Business Strategy"Customer First" is the attitude that is highly pursued by the Company. Lite-On Technology believes that our customers are the most important assets, so generating profits for our customers is indeed the main goal of business operation. We insist on a quality policy of zero-defect, on-time delivery, leading technology, and total customer satisfaction, and requires all employees to be able to listen to the customers, so as to grasp the trend, to generate market profits, and to jointly create a triple-win situation. Only when the customers are truly satisfied can a company enjoy an exceptional growth in profits.
To reach the goal of "customer satisfaction first," it is a must to adopt the strategy, so-called "Golden Triangle of Operating Excellence," that focuses on the best quality and consists of "growth," "value" and "stability." Regarding growth, we insist on striving for Lite-On's competitive edge in this fast-growing market; regarding value, Lite-On provides customers with differentiated products and technology to differentiate Lite-On's own value; regarding stability, Lite-On will continue to generate excellent profits and cash flow for our shareholders.
Establishment of Global Headquarters
The Lite-On Technology Building located in the Neihu Technology Park was inaugurated from June, 2003, and is the headquarters, as well as the R&D/information/finance centers. Moreover, this headquarters symbolizes that the Company has reached the milestone for advancing into the next stage of growth after Lite-On Technology's four-into-one merger.
Sixty percent of the foundation surface of the Lite-On Technology Building is covered by green space, providing an area of "technology, humanism, and environmental protection" as feedback to employees and society. In terms of planning on use of the building, the concept of "humanism" is emphasized, further stressing simple, practical and automated design; the building offers colleagues of the Company with a constructive, highly-efficient and human-centered working environment, to further improve the employee and corporate productivity. Besides, the appearance of the building resembles a model of both hands together that represents the respect shown by mankind to God, where "both hands together" stands for greeting and gratitude, just like both hands up raised to worship and thank God, which pass on Lite-On Technology's rich care for humanity and down-to-earth corporate culture.
Awards and Recognitions
Lite-On Technology has gone all the way to receive much recognition from the government and the customer, as it was granted many awards and certifications in the year of 2003, which directs enormous honor and inspiration to the Company that we remember with gratitude. A few examples are:
Lite-On Technology was honorably ranked the 61st in the U.S. Business Week Global IT 100.
Lite-On Technology was honorably ranked 6th in the "2003 Benchmark Enterprise Reputation Survey" conducted by Common Wealth Magazine.Lite-On Technology's Peripherals and Components Strategic Business Group honorably received the "Excellent Product Design Award" given by the Taiwan External Trade Development Council.Lite-On Technology was given the HP Best Supplier Award.The Taipei City Hsinyi Community College undertaken by Lite-On Cultural Foundation was awarded the "Outstanding Prize" in the review conducted by the Department of Education of Taipei City in 2002 and 2003 consecutively.
Gratitude Lite-On Technology will continue to work hard to constantly improve the corporate body and product competitiveness, in order to maintain corporate achievements and constant growth of profits, to generate the maximum benefits for shareholders, customers and employees, and to share the fruitful achievements together.
In conclusion, again Lite-On would like to sincerely thank all shareholders, customers, suppliers and our colleagues, for it is your encouragement and contribution that make Lite-On Technology capable of generating higher return on investment for investors, as well as help us in the pursuit of enlightening the world by the spirit of "quality" and "humanism," as we always have the vision of becoming a global excellent company. We hereby express our heartfelt appreciation!
9 10
Chairman
Chief Executive Officer
11 12
C o r p o r a t e O v e r v i e w
Management team members (from left to right): CEO David Lin, Chairman Raymond Soong, Deputy CEO Warren Chen,
President of Peripherals and Components SBG K.C. Terng, President of Image SBG Paul Lo, President of New Business
Development SBG Danny Liao, President of Communications SBG Ignatius Wei, and CFO Andrew Lin.
13 14
1.1 Established: March 17, 1989
1.2 Milestones On November 4th, 2002, Lite-On Electronics, Silitek, Lite-On Technology and GVC merged and became known as Lite-On
Technology Corporation. The remaining company inherits the Stock Code of 2301.
2004
Lite-On Technology selected as " 2003's No. 1 Optoelectronics Company in the Top 1000 Manufacturers" by Business Weekly
in Taiwan.
Lite-On Technology acquires Lite-On Enclosure Inc.
Lite-On Technology garners LED-Based White Emitting Cross-Licensing through the Peripherals & Components Strategic
Business Group with OSRAM.
The Peripherals & Components Strategic Business Group awarded "Supplier of the Year 2003" from INVENTEC.
The Lite-On Cultural Foundation selected to manage the "National Children Counseling Seminar" from 2001 to 2004 by
Children's Bureau of Interior R.O.C.
Silitech, one of Lite-On Technology's affiliates, issued initial public offering on the Taiwan Stock Exchange with Stock Code 3311.
2003
Lite-On Technology selected as "No. 61 among the Top 100 IT companies ranking" by Business Week of U.S..
Lite-On Technology selected as " Top Six Manufacturing Company" by Common Wealth Magazine in Taiwan.
Lite-On Technology Peripherals & Components Strategic Business Group wins the "Product Design Excellent Award" from the
China External Trade Development Council.
Lite-On Technology receives HP Best Supplier Award.
Chairman Raymond Soong selected as one of the "Top-10 Distinguished Entrepreneurs in IT Industry for 2002" by Excellence
Magazine of Taiwan.
The real estate management department of Lite-On Technology spins off as a separate entity known as the Lite-On Real Estate
Management Corporation.
"Build a New Home," a radio program broadcasted by the Lite-On Cultural Foundation, wins the 1st National Golden Voice
Award for the "Best Talk Program".
Taipei Shin-Yi Community College, managed by the Lite-On Cultural Foundation, wins "Excellence Award for Management and
Development" from the Bureau of Education Administration of Taipei City Government for the second consecutive year.
2002
Lite-On invites local and offshore Chinese students as well as professional designers to participate in the 3rd Annual Lite-On
Awards competition.
The Lite-On Cultural Foundation's Children Counseling Group receives the "Group & Personal Golden and Diamond Awards"
from the Taipei City Government.
The quarterly magazine Gen Shin Garden, published by the Lite-On Children Counseling Group, wins the "2002 Education
Publication Excellence Award" from the Executive Yuan of the Republic of China.
2001
Lite-On Electronics Inc. receives "Golden Award of Global Excellent Business Model" from the Ministry of Economic Affairs.
The Lite-On Cultural Foundation receives "Golden Wen-Xin Award" from the Council for Cultural Affairs (CCA) of
Executive Yuan.
The Lite-On Cultural Foundation selected to retain the right of managing the Taipei Shin-Yi Community College with a
common objective of offering lifelong learning opportunities to the community.
2000
With government approval, Silitek Corp., Lite-On Electronics Inc., Lite-On IT Corp. and Lite-On Enclosure Inc. form joint-
venture to build a 1.6 square-kilometer Guangzhou Science Park in China.
Lite-On Group donates NT$24 million and establish a Taiwanese elementary school in Dong-Guan, providing a good learning
environment to the children of Lite-On Taiwanese employees.
Lite-On launches the first Lite-On Awards, attracting more than 500 competitors from colleges and initiating the atmosphere
of innovation and research.
1999
The Optoelectronics business unit of Lite-On Technology spins off as a separate entity known as the Lite-On IT Corporation.
Lite-On Group acquires the GVC Corp.
Lite-On obtains construction license for a new global headquarter. Construction scheduled to begin on September 22 and
finish within three years.
Lite-On Group donates NT $31 million dollars to the victims of the September 21st earthquakes.
1 . C O M P A N Y P R O F I L E
15 16
1992
Lite-On Electronics Inc. earns the IECQ/ISO 9000 certifications.
Lite-On Technology establishes a subsidiary company in the Kiel City, Germany.
Silitek Corp. establishes a Lite-On Peripherals, Ireland, Ltd. as a branch office in Limerick City, Britain to better service its
European customers.
1991
Lite-On acquires the Switching Power Supply plant of NPE Company in Britain and operates under the name Lite-On Ltd.
1990
Lite-On Electronics Inc. establishes plant in Penang, Malaysia to manufacture Switching Power Supply.
Silitek Corp. acquires Maxi Switch Company, the third largest manufacturer of keyboards in the U.S. and hence added
value to its product line.
1989
Lite-On Electronics Inc. introduces its Corporate Identity System (CIS).
Lite-On Electronics Inc. establishes its first overseas production facility in Bangkok, Thailand to manufacture
optoelectronics products.
Lite-On Technology is established with NT$110 million in capital to begin manufacture of color CRT monitors.
1983
Lite-On Electronics Inc. issued initial public offering with the Stock Code of 2301 as the first technology firm on Taiwan
Stock Exchange.
1975
Lite-On Electronics Inc. establ ished with NT $1 mil l ion in capital and init iates its LED production plant in Chung-
Ho City, Taipei.
1998
Lite-On Electronics Inc. Tianjin plant and Lite-On Technology Shijie plant begin operations.
Lite-On Cultural Foundation receives "Group Service Award of Social Education" from the Ministry of Education.
1997
Lite-On Group further expands its manufacturing and customer service capabilities through 5 new constructions and existing-
plant expansion in several parts of the world, bringing the total number of Lite-On Group's manufacturing facilities to 38 locations.
With improvements in environmental quality, Lite-On Electronics Inc., Lite-On Technology and Lite-On Electronics Inc. of
England all receive ISO-14000 certifications.
1996
Lite-On IT Technology establishes a holding company and a product development center in Singapore. Also, the company
starts building the China Factory.
1995
Lite-On Electronics Inc. Thailand plant is ISO-9002 certified.
Silitek Corp. rubber plant in Malaysia is ISO-9002 certified.
Lite-On Technology is publicly listed on the Taiwan Stock Exchange, Stock Code:2346.
1994
Lite-On Electronics Inc. Optoelectronics business unit and Lite-On Technology Keelung plant are both ISO 9001 certified.
Silitek Corporations' Keelung and Tamshui plants in Taiwan, and Malaysian plant receive ISO 9002 certifications.
1993
Seven plants of the Lite-On Group receive ISO-9000 certifications.
The Lite-On Cultural Foundation is founded to cultivate humanity and concern for enterprise cultures, to promote public
welfare, and to support children's growth.
17 18
2 . O R G A N I Z AT I O N
2.1 Organization System
Organization Chart Function Description
Above is the Orgnization Chart of Lite-On Technology as of April 30th, 2004. The company structure and staff members' organization balance business efficiency and scale, in order to achieve the collaborative effectiveness that comes from simplifying the organization, achieving balance between divisions, and emphasizing teamwork.
Board of Directors
Stock Affairs Internal Auditing
Chairman
CEO
Deputy CEO Shared Services
Corp. Procurement
Corp. Information Technology
Manufacturing Operation Excellence
Strategic Planning
Business Strategy Development
Technical Research Development
Global Strategic Account Management
Corp. Function
Finance
Legal
Human Resources
Real Estate Management
Functions
Internal Auditing
Stock Affairs
Corporate Procurement
Information Technology
Manufacturing Operation Excellence
Finance
Legal
Human Resources
Real Estate Management
Global Strategic Account Management
Technical Research & Development
Business StrategyDevelopment
Description
Adds value and improves operations via independent, objective consulting activities. Helps the company accomplish objectives through a systematic, disciplined approach that evaluates and improves upon existing risk-management, control, and governance processes.
Manages issues related to account opening, stocks transfers, inquiries and information update for shareholders.Manages the shareholder meetings. Manages issues related to dividend payout and capital stock increases.Applies income tax for dividend income.
Develops and executes corporate procurement strategies.
Develops IT strategies.Designs infrastructure architecture.Manages performance of IT investments.Automates business operations and processes.
Manages global manufacturing operations to ensure effective utilization of corporate resources. Overseas productivity improvements, logistic controls and customer satisfaction initiatives.
Provides financial services to enhance company’s profitable growth. Establishes stringent risk-control discipline.Promotes unyielding integrity towards operational transparency.Ensures flawless execution of financial plans to continuously expand shareholder value.
Provides legal advice and services to the company.Oversees regulatory legal compliance. Strengthens internal management controls.Applies for and maintains intellectual property rights to improve the company’s competitiveness in the industry.
Plans and executes human resources programs to meet the company’s strategic development needs and to ensure the continuous development of human-capital assets.Recruits, develops and retains staff sufficient to meet the company’s operation needs.Develops comprehensive, competitive compensation and benefits policies to attract and retain well-qualified people.Initiates performance-management systems and employee-development policies that improve the organization’s overall performance and competency.Initiates safety and health policies to protect the employees and ensure the compliance with safety laws. Offers services to all employees who need help with personal issues.
Cooperates with the company’s development and operational needs to integrate, plan, and structure the global plants and factories.Manages and operates the real estate of global headquarters.
Oversees global marketing & sales, business planning, customer service, and supply-chain management.
Assists each business unit in strengthening core competencies. Integrates technologies and product development activities.
Develops business strategies for mergers and acquisitions.
Strategic Business Group
New Business
DevelopmentComputerCommunicationsImage
Peripherals &
Components
19 20
Note 4
Note 5
Note 6
Note 7
Mr. Raymond Soong
Mr. Chung –Yiao Lin
Representative of
Dorcas Investment
Co., Ltd.
Mr. David Lin
Representative of
Lite-On Capital Inc.
(Note 1)
Mr. Y. J. Kao
Representative of
Sam–Foung
Investment Co., Ltd.
Chairman
Director
Director
Director
April 19th,
2001
April 19th,
2001
April 19th,
2001
April 19th,
2001
May 20th,
1992-May
19th, 1995
May 30th,
1995-May
29th, 1998
May 19th,
1998-May
18th, 2001
April 19th,
2001-April
18th,2004
April 19th,
2001-April
18th,2004
April 19th,
2001-April
18th,2004
April 19th,
2001-April
18th,2004
45,076,330
1,903
2,216,024
2,965,700
7.85%
0.39%
0.52%
95,415,870
7,278,843
18,187,237
6,643,413
4.25%
0.32%
0.81%
0.30%
18,006,990
212,727
7,727,566
2,122
0.80%
0.01%
0.34%
B.S., Electronic Engineering, Taipei College of Technology
Chief of Engineer of T.I. Corp.
Senior Engineer of RCA Corp. Taiwan Branch Office
Taiwan Theological College & Seminary
MBA, Tulane University
President of T.I. Corp. Taiwan Branch office
China College of Marine Technology & Commerce
Supervisor Fung-Ing
Soong
Spouse 35,377,011
23,664,674
23,664,674
23,619,674
3
3
3
3
2.2 Information of Board Members, Supervisors, Presidents, Vice Presidents, and other Executive Officers.
Board Members and Supervisors
Record Date: April 17th, 2004
Title Name
Shares % Shares % Shares % Shares %
DateElected
Term(Years)
Shareholdingwhen Elected
CurrentShareholding
Spouse & MinorShareholding
Use Other PersonalName to Held
the Shareholding
Education & ExperienceShareholding when Elected
2003 Based Pay and TransportationAllowance
Current Position with
Other Company
Board of Directors, Supervisors or Managers who are Spouse or within 2
Degrees of Consanguinity to Said Person
Title Name Relation
21 22
Note 8
Note 9
Note 10
Note 11
Note 12
Mr. Warren Chen Representative of Lite-On Capital Inc.
(Note 1)
Mr. Keh-Shew Lu
Representative of Da-
Song Investment Co.,
Ltd.
Mr. Lu-Bao Shu
Representative of Da-
Song Investment Co.,
Ltd. (Note 2)
Mrs. Fung-Ing Soong
Mr. David Lee
Representative of Da-
Song Investment Co.,
Ltd. (Note 3)
Director
Director
Director
Supervisor
Supervisor
April 19 th,
2001
April 19 th,
2001
April 19 th,
2001
April 19 th,
2001
April 19 th,
2001
April 19 th,
2001-April
18 th,2004
May 19 th,
1998-May
18 th, 2001
April 19 th,
2001-April
18 th,2004
May 19 th,
1998-May
18 th, 2001
April 19 th,
2001-April
18 th,2004
May 20 th,
1992-May
19 th, 1995
May 19 th,
1998-May
18 th, 2001
April 19 th,
2001-April
18 th, 2004
May 19 th,
1998-May
18 th, 2001
April 19 th,
2001-April
18 th, 2004
2,216,024
22,683,730
22,683,730
11,009,572
22,683,730
0.39%
3.95%
3.95%
1.92%
3.95%
18,187,237
56,656,189
56,656,189
18,006,990
56,656,189
0.81%
2.52%
2.52%
0.80%
2.52%
3,886,068
95,415,870
6,942
0.17%
4.25%
B.S., Chemical Engineering, Chinese Culture University;
Chief of MFG Dept. of T.I. Corp. Taiwan Branch Office
B.S., Electrical Engineering, National Cheng Kung University
M.S., Electrical Engineering, Texas Tech University
Ph. D., Electrical Engineering, Texas Tech University
Director, Asia of Texas Instruments Corp.
Senior Deputy Director, Memory Products
Senior Deputy Director, Analogy & Mixed Signal and Logic Products
B.S., Physics, National Cheng Kung University
Executive President, Philips Taiwan
Associate Professor of National Chiao Tong University
Chairman of Asia Pacific branch,, Member of Philip global
manufacturing consulting committee and Director of Asia Pacific Branch
Director of TSMC
Vice Chairman of, Walsin Lihwa Corp.
Chief Executive Officer of Hann Star Corp.
National Chiayi Teachers College
Department of Accounting, National Chengchi University
Chairman Raymond
Soong
Spouse
23,664,674
26,664,674
23,514,674
23,604,674
23,544,674
3
3
3
3
3
2.2 Information of Board Members, Supervisors, Presidents, Vice Presidents, and other Executive Officers.
Board Members and Supervisors
Record Date: April 17th, 2004
Title Name
Shares % Shares % Shares % Shares %
DateElected
Term(Years)
Shareholdingwhen Elected
CurrentShareholding
Spouse & MinorShareholding
Use Other PersonalName to Held
the Shareholding
Education & ExperienceShareholding when Elected
2003 Based Pay and TransportationAllowance
Current Position with
Other Company
Board of Directors, Supervisors or Managers who are Spouse or within 2
Degrees of Consanguinity to Said Person
Title Name Relation
23 24
2.2 Information of Board Members, Supervisors, Presidents, Vice Presidents, and other Executive Officers.
Board Members and Supervisors Information of the Major Shareholders of Institutional Investors
Information of Representative for Lite-On Technology’s Institutional Investors.
Notes:
1. SiTong Investment & NPort Investment Co., Ltd., the original director of the Company, has merged with Lite-On Capital, Inc. and becomes known as NPort Investment Co., Ltd., taking over the rights and obligations of SiTong Investment Co., Ltd. and NPort Investment Co., Ltd. and assigning Mr. David Lin and Mr. Warren Chen as representatives.
2. Mr. Lu-Bao Shu replaced Mr. Han-Chun Wang on August 13th, 2003.
3. Mr. David Lee replaced Mr. Y. T. Pan on June 17th, 2003.4. Mr. Raymond Soong: Director of the following companies - Ltc Group Ltd., Lite-On Technology (Europe)B.V., Lite-On Communications International Corp. , Lite-
On Technology International Inc., Lite-On Capital Inc., Quanix Technology Inc., Lite-On Technology Mexico S.A.DE C.V., LTC International Ltd., Titanic Capital Services Ltd., Lite-On Computer (Dongquan) Co., Ltd., Great Adelphi International Ltd., Seelfu Co., Ltd., Lite-On IT (Hong Kong) Co., Ltd., High Yield Group Co., Ltd., Lite-On IT (Guangzhou) Co., Ltd., Lite-On IT (Guangzhou) Co., Ltd., Lite-On Electronics (Thailand) Co., Ltd., Lite-On, Inc, Lite-On Electronics (Europe) Ltd., Lite-on Electronics Ltd., Lite-On Electronic (Singapore)Co., Ltd., Lite-on Electronics (BVI) .Inc., Lite-On Ltd., Lite-On (Europe) Inc., Lite-On Electronic (Tianjin)Co., Ltd., Lite-On Electronic (Hong Kong) Co., Ltd., Funbo Enterprises Limited, Ltd., Lite-On Electronic (Dongquan) Co., Ltd., Lite-On Electronic (Guangzhou) Co., Ltd., China Bridge (BVI) Ltd., Zhong Bao Holding (China) Ltd., Lite-On Technology(China)Inc., Ltd., China Bridge Express(WuXi) Co., Ltd., Silitek Corporation (M) Sdn. Bhd., Maxi Switch Inc., Maxi Switch S. A. DE C.V., Lite-On Peripherals (Hong Kong) Limited, Yet Foundate Ltd., Silitek Plating Ltd., Ltd., Lite-On Peripherals Inc., Silitech Technology (Europe) Limited, Lite-On Peripherals Ireland Limited, Lite-On Computer Peripherals GmbH, Lite-On Peripherals de. Mexico S.A. de C.V., Lite-On Peripherals Pte. Ltd., Silitek Electronic (Dongquan) Co., Ltd., Xurong Electronic (Dongquan) Co., Ltd., Xurong Electronic (Shen Zhen)Co., Ltd., Silitek Electronic (Guangzhou) Co., Ltd., Yet Foundate Electronic (Guangzhou) Co., Ltd., Lite-On Information Technology Co., Ltd., E-Business Limited., I-Solutions Limited, Silitek Netherlands B.V., Starshine Technology Corp. Silitech (BVI) Holding Ltd., Silitech (Bermuda) Holding Ltd., Silitech Technology Corporation Sdn. Bhd., Silitech Technology Corporation Limited, G-Com(BVI) Technology Ltd., Giga-Radio Comm. (BVI) Co.,Ltd., G-Prime Computer Company Ltd., GVC (Cayman) Corp., GVC Corporation Ltd., Lite-On Communication (Guangzhou) Co., Ltd., E-LITEON Corporation, Investnet.com Ltd., Lite-On Eoking Inc. Lite-On Integrated Service Inc., Lite-On Eco Technology Inc., Lite-On ECO Corporation, Liteon-On Computer Technology (Guangzhou) Co., Ltd., Lite-On Information Technology Co., Ltd., Lite-On International Holding Co., Ltd., Lite-On USA Holding Co., Ltd., Lite-On Technology USA, Inc., Lite-On Trading USA, Inc., Lite-On Semiconductor Co., Ltd. Actron Technology Corporation., Lite-On IT Co., Ltd. Silitech Technology Corporation, Min-Sin Investment Co., Ltd., Da-Song Investment Co., Ltd., Tung-Young Investment Co., Ltd. Yuan-Pao Development Investment Co., Ltd., Da-Rung Investment Co., Ltd. Shanghaii Sue-Fu Electronic Co., Ltd., DIODES,INC., DYNA International Holding, Lite-On Semi. (Hong Kong) Co., Ltd., Hong Kong Laing-Min Co., Ltd., DYNA International Co., Lite-On Semi. (WuXi)Co., Ltd., Tailink Venture Found Co., Ltd., Co-Tech Copper Foil Corp.
5. Mr. Chung-Yiao Lin: Chairman of Dorcas Investment Co. Ltd. & Chai-An Investment Co., Ltd.
6. Mr. David Lin: Director of the following companies - Ltc Group Ltd., Lite-On Technology International Inc., Lite-On Capital Inc., Quanix Technology Inc., Lite-On Technology Mexico S.A.DE C.V., LTC International Ltd., Titanic Capital Services Ltd., Lite-On Computer (Dongquan) Co., Ltd., Great Adelphi International Ltd., Dongquan Sue-Fu Computer Co., Ltd., Lite-On Mexico SA DE C.V., Lite-On Opto (Guangzhou) Co., Ltd., Lite-On Electronics (Thailand) Co., Ltd., Lite-On, Inc, Lite-On Electronics (Europe) Ltd., Lite-on Electronics Ltd., Lite-On Electronic (Singapore)Co., Ltd., Lite-On Ltd., Lite-On Electronic (Tianjin)Co., Ltd., Lite-On Electronic (Hong Kong) Co., Ltd., Funbo Enterprises Limited., China Bridge (BVI) Ltd., Zhong Bao Holding (China) Ltd., China Bridge(China) Ltd., China Bridge Express(WuXi)Co., Ltd., Silitek Corporation (M) Sdn. Bhd., Maxi Switch Inc., Maxi Switch S. A. DE C.V., Lite-On Peripherals (Hong Kong) Limited, Yet Foundate Ltd., Silitek Plating Ltd., Lite-On Peripherals Inc., Silitech Technology (Europe) Limited, Lite-On Peripherals Ireland Limited, Lite-On Computer Peripherals GmbH, Lite-On Peripherals de. Mexico S.A. de C.V., Lite-On Peripherals Pte. Ltd., Silitek Electronic (Dongquan) Co., Ltd., Xurong Electronic (Dongquan) Co., Ltd., Xurong Electronic (Shen Zhen)Co., Ltd., Silitek Electronic (Guangzhou) Co., Ltd., Yet Foundate Electronic (Guangzhou) Co., Ltd., Lite-On Information Technology Co., Ltd., E-Business Limited., I-Solutions Limited, Silitek Netherlands B.V., Starshine Technology Corp. Silitech (BVI) Holding Ltd., Silitech (Bermuda) Holding Ltd., Silitech Technology Corporation Sdn. Bhd., Silitech Technology Corporation Limited, G-Com(BVI) Technology Ltd., Giga-Radio Comm. (BVI) Co.,Ltd., G-Prime Computer Company Ltd., GVC Subic Corp., Maxtech Holding Inc., GVC (Cayman) Corp., G-Tech USA, Inc., GVC Holding Inc., Maxtech Int'l Corp., GVC Corporation Ltd., Lite-On Communication (Guangzhou) Co., Ltd., E-LITEON Corporation, Investnet.com Ltd., Lite-On Eoking Inc. Lite-On Integrated Service Inc., Lite-On Eco Technology Inc. Lite-On ECO Corporation, Lite-On Computer (Guangzhou) Co., Ltd., Lite-On Information Technology(Shanghaii)Co., Ltd., Lite-On International Holding Co., Ltd., Lite-On USA Holding Co., Ltd., Lite-On Technology USA, Inc., Lite-On Trading USA, Inc., Lite-On Semi., Co., Ltd. Lite-On IT Co., Ltd., Silitech Technology Corp. ,Shanghai SeeFu Electronic Co., Ltd., DYNA International Holding, Lite-On Semi. (Hong Kong) Co., Ltd., HongKong MinLiang Co., Ltd., DYNA International Co., Lite-On Semi. (WuXi)Co., Ltd.
7. Mr. Warren Chen: Director of Lite-On IT Co., Ltd., Lite-On Electronics (Thailand) Co., Ltd., Lite-On, Inc, Lite-On Electronic (Singapore)Co., Ltd., Lite-On Ltd., Lite-On Electronic (TainJian)Co., Ltd., Lite-On Electronic (Hong Kong) Co., Ltd., Funbo Enterprises Ltd., China Bridge (BVI) Ltd., Zhong Bao Holding (China) Ltd., Lite-On Peripherals Inc. , Lite-On Technology USA, Inc., Epistal Corp. Supervisor of Lite-On Eoking Inc. Lite-On Integrated Service Inc., Lite-On Eco Technology Inc. Lite-On Automotive Corp.
8. Mr. Keh-Shew Lu: Partner and President of Pu-Shin Investment Corp. Consultant of Winbond Electronic Corp. Director of American Zeev and AmericanTriscent and Diodes Inc
9. Mr. Lu-Bao Shu: Chairman of Taiwan Philips Quality Culture Foundation. Honor Speaker of National Chiao Tung University Director of Winbond Electronic Corp., Corporate Synergy Development Center & Vanguard International Semiconductor Corporation.
10.Mrs. Fung-Ing Soong Director of Da-Song Investment Co., Ltd., Ming-Sin Investment Corp. Tung-Yuang Investment Corp. Yuan-Pao Development Investment Co.Ltd., Da-Rung Investment Co., Ltd.
11.Mr. David Lee Director of Lite-On Automotive Corp. and Alltek Tech. Corp. Ltd., Supervisor of Actron Technology Corporation, and President of Dyna Investment Co. Ltd.
Record Date: April 17th, 2004
Record Date: April 17th, 2004
Name of Institutional Investors
Dorcas Investment Co., Ltd.
Sam-Foung Investment Co., Ltd.
Lite-On Capital Inc.
Da-Song Investment Co., Ltd.
Major Institutional Shareholders
Paul Lin and Jenny Chang
Simon Wu, H.J. Kao, I.S. Wu and M.C. Wu
Lite-On Technology Corporation
Raymond Soong and Fung-Ing Soong
Name of Institutional Investors
Lite-On Technology Corporation
Major Institutional Shareholders
Not Applicable
25 26
Directors and Supervisors’ Status of Independence
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Mr. Raymond Soong
Mr. Chung-Yiao Lin Representative of Dorcas Investment Co., Ltd.
Mr. David Lin Representative of Lite-On Capital , Inc. (Note 1)
Mr. Y.C. Kao Representative of Sam-Foung Investment Co., Ltd.
Mr. Warren Chen Representative of Lite-On Capital , Inc.
Mr. Keh-Shew Lu Representative of Da-Song Investment Co., Ltd.
Mr. Lu-Bao Shu Representative of Da-Song Investment Co., Ltd.
Mrs. Fung-Ing Soong
Mr. David LeeRepresentative of Da-Song Investment Co., Ltd.
Record Date: April 17th, 2004
Name
Criteria Minimum 5 Years’ Experience in Business,
Legal, Financial or Corporate Operation
(Yes/No)
Status of Independence (Note 2) Remarks
Note for Status of Independence
1. SiTong Investment & NPort Investment Co., Ltd., the original Chairman of the Company, has merged with Lite-On Capital, Inc. and becomes known as NPort Investment Co.,
Ltd., taking over the rights and obligations of SiTong Investment Co., Ltd. and NPort Investment Co., Ltd. and assigning Mr. David Lin and Mr. Warren Chen as representatives.
2. i. Not an employee of the Company, or Director, Supervisor or employee of the Company affiliates.
ii. Not a shareholder listed among the top10 owning most of the Company’s shares, or directly or indirectly owns 1% or more of the issued shares of the Company.
iii. Not a spouse or to the 2nd degree of lineal consanguinity of anyone in the aforementioned 2 categories.
iv. Not a Director, Supervisor, or an employee of any investor institution that owns 5% or more of the Company’s issued shares, or a Director, Supervisor, or an employee of
the top 5 listed investor institution that owns most of the company’s shares.
v. Not a Director, Supervisor, or manager, or a shareholder owning 5% or more of stocks of any specific company or institute entity maintaining financial or business
relationships with the Company.
vi. Not a business owner, partner, Director, Supervisor, manager or spouse of thereof of a joint venture, solo venture, corporate or institutional entity that provides financial,
business, or legal consultation services to the Company or its affiliates.
vii. Not an investor institution or the representative thereof set forth in Article 27 of the Corporation Law.
As of April 30, 2004
Issue Date
Face Value
Issuance and Listing
Issue Price
Total Amount
Coupon Rate
Term
Guarantor
Trustee
Underwriter
Attorney
Accountant
Payment Method
Outstanding Amount
Conditions on Redemption or Early Repayment
Restriction Clause
Name of The Credit Rating Institution, Date Rated, and
Results on Rating of The Corporate Bond
Other Rights
The Amount of Converted Common Stock,
Global Depositary Receipt, or Other Securities Upon
the Date of Annual Report Released
Issuance, Conversion, or Warrants
Dilution Effect and Other Adverse Effects on
Existing Shareholders
Name of Custodian Institution Handling Exchange
September 25 and 26, 2003
NT$ 5,000,000
Taiwan
As per face value
NT$ 4,000,000,000
Note 1
5 years
Expiration date: September 25 and 26, 2008
CitiBank Taipei Branch
Bank SinoPac
N/A
Hui-Chi Kuo Modern Law Office
Clark Chen, James Wu
Qing-Xiang Chen and Jin-Shun Wu (Deloitte & Touche)
30%, 30% and 40% of Principal will be
paid on the third, fourth and fifth year.
NT$ 4,000,000,000
N/A
Note 2
N/A
N/A
N/A
N/A
N/A
3 . Issuance of Corporate Bonds
3.1 Issue Status:
Bond Type First Secured Common Corporate Bond
27 28
Note 1:
Security A NT$400,000.000:If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0001%-6M LIBOR) MIN0.
Security B NT$400,000.000: If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0002%-6M LIBOR) MIN0.
Security C NT$200,000.000:If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0000%-6M LIBOR) MIN0.
Security D NT$400,000.000:If 6M LIBOR 1.00%, coupon rate is 6M LIBOR
If 1.00% 6M LIBOR 2.10%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0002%-6M LIBOR) MIN0.
Security E NT$300,000.000: If 6M LIBOR 1.00%, coupon rate is 6M LIBOR
If 1.00% 6M LIBOR 2.10%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0000%-6M LIBOR) MIN0.
Security F NT$300,000.000: If 6M LIBOR 1.00%, coupon rate is 6M LIBOR
If 1.00% 6M LIBOR 2.10%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0001%-6M LIBOR) MIN0.
Security G NT$200,000.000:If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0000%-6M LIBOR) MIN0.
Security H NT$300,000.000:If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0001%-6M LIBOR) MIN0.
Security I NT$300,000.000: If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0002%-6M LIBOR) MIN0.
Security J NT$200,000.000: If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0003%-6M LIBOR) MIN0.
Security K NT$300,000.000: If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0004%-6M LIBOR) MIN0.
Security L NT$200,000.000: If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0005%-6M LIBOR) MIN0.
Security M NT$300,000.000: If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0006%-6M LIBOR) MIN0.
Security N NT$200,000.000:If 6M LIBOR 0.90%, coupon rate is 6M LIBOR
If 0.90% 6M LIBOR 2.00%, coupon rate is 3.05%;
If 6M LIBOR 2.00%, coupon rate is (4.0007%-6M LIBOR) MIN0.
The first coupon date is two business days before the issuing date for each Security. The coupon rate is adjusted by 6M LIBOR on the following coupon dates that are two business days before the basic coupon date of every 6 months starting from the issuing date and is calculated by simple rate on the basic coupon date . The face rate shall not be lower than %. (the business day here means the business days of banks in London. In case of holidays, one business before the basic coupon date is recognized.)
6M LIBOR: 6 month LIBOR means the Fixing Rates of USD 6-Month LIBOR listed on Page 3750 of Money line Telerate at 11 o’clock on the coupon date (London time).
Note 2: Based upon the original restriction on the consolidated report (annual certification), the cap of leverage ratio is 125%, the bottom line of current ratio is 100%, the bottom line of TIE ratio is 300%, tangible net worth should be at least NT$35,000,000,000.
3.2 Information of Convertible Corporate Bond: None
3.3 Information of Exchangeable Corporate Bond: None
3.4 Status of Overall declaration on issue Corporate Bond: None
3.5 Information of Corporate Bond with Stock Option: None
4. Preferred Shares Status : N/A
5. IsIssuance of Global Depositary Receipts (GDRs)
6. Employee Stock Option : N/A
Issuance & Listing
Total Amount
Offering Price per GDR
Units Issued
Underlying Securities
Common Shares Represented
Rights and Obligations of GDR Holders
Trustee
Depositary Bank
Custodian Bank
GDRs Outstanding
Apportionment of The Expenses For The Issuance and
The Maintenance
Important Terms and Conditions in The Deposit
Agreement and The Custody Agreement
Closing Price per GDR
2003 High
Low
Average
As of April 30, 2004 High
Low
Average
London Stock Exchange
US$ 71,295,000
US$14.55
4,900,000 Units
Common Shares from Cash Injection
49,000,000 Shares
Same as Those of Common Share Holders
Citibank,
Citibank,
Citibank,
1,914,720 Units
Borne by the Company
US$ 12.871
US$ 8.895
US$ 10.866
US$ 12.317
US$ 10.510
US$ 11.411
Issue Date
ItemsSeptember 25, 1996
29 30
8.1 The FoundersThe Lite-On Culture Foundation was founded in 1993 with initial funds donated by the three founders of the Lite-On
Group: Mr. Raymond Soong, Mr. Paul Lin and Mr. Simon Wu. The Lite-On Group continues to allocate NT$10 million
annually to support the Foundation's initiatives and plans.
8.2 Primary Areas of Focus
Managing the Taipei Shin-Yi Community College
With a common objective of offering lifelong learning opportunities to the community, 12 community colleges have
been set up in different districts of the Taipei city. The Foundation is selected to retain the rights of managing the Taipei
Shin-Yi Community College on June 29th, 2001 offering 110 courses to about 3,000 students in each semester.
Encouraging Volunteers to Offer Counseling Services to Children
Children are the hope of a nation, and only healthy children grow up to be
healthy adults. The children's counseling group recruits volunteering parents from elementary and junior high schools
and provides them with training sessions before assigning them to cases from the student counseling offices at schools.
The first "Children Counseling Group" was set up in Min- Zu Elementary School of Taipei City in March, 1998. There are
more than 40 groups of 20 to 30 volunteers serving at elementary schools located in Taipei City, Taipei County, Chong-
Li, Hshin-Chu, Chang-Hua and Kao-Shiung. More than 1,000 volunteers are available to service from each of more than
100 schools applying to join this counseling program. (More than 100,000 volunteers have been trained in the past years.)
Broadcasting Educational Programs on Radio
The Foundation started a radio program, "Love in Your Community", with Good News Broadcasting Station on July 1st,
1997. This program was renamed twice to "Build a New Home" on January 1st 2001 and then "Community College
EASY GO" on August 1st, 2003. The program is broadcasted for one hour on various subjects, including life-time
learning, environment protection, art and life, health, community counseling services, local literatures and history,
community services, volunteering services, teenager issues, senior welfares, government policy promotion and oversea
community introduction, from Monday to Saturday.
Community Development Serials
The Foundation has published 17 titles of" Community Development" series with the sponsorship of Bureau of Interior,
R.O.C., including Community Encyclopedia, Windows of Communities, The Stories of Community, Searching for the
Root, The Hear of Grass, Another Flavor in Life, Build A New Home, Build Our Home Together, Global Village, Life in
BeiTou, Footprint, Love in the Neighborhood, A Sandglass of Time, A Palette for Youth, Build A home with Sunshine,
Communication with Your Heart and Build A Network of Love.
7 . Merger and Acquisit ion:
7.1 Evaluation made by the leading manager of new stock issuance for merger or acquisition in the last quarter: None.
7.2 The information of the merged companies has been approved by the Board of Directors as of the printing date of this Annual Report.
Note: The related financial information has been audited by accountants by December 31st 2003. Except the Per
Share data and unless otherwise specified, all numbers are represented in thousand NT Dollars.
LITE-ON ENCLOSURE INC.
4F, 29-1, Lane 66, Juei-Kwang Rd., NeiHu Dist., Taipei.
Raymond Soong
NT$950,000
Process and assembling of computers and
Peripherals and plastic finished products.
Computer cases and Bare bone systems
(note)
NT$3,656,270
NT$2,527,058
NT$1,129,212
NT$6,001,205
NT$1,081,663
NT$569,215
NT$142,799
NT$1.5
Company name
Company Address
Person in charge
Paid-in-capital
Core Business
Main products
Financial statement of the last fiscal year
Total Asset
Total Debit
Total shareholder's equity
Operating Income
Operating Gross Profit
operating profit and loss
profit and loss
Earning Per Share
8 . Introduction of Lite-On Cultural Foundation
31 32
8.3 Awards and Achievements
The Lite-On Children Counseling GroupThe Foundation received the Group and Personal Award for Youth Volunteer Service from National Youth Commission in 2001.Junior High School, Lee Shan Elementary School and Da Hu Elementary School received the Group and Personal Golden and Diamond Awards from the Taipei City Government.Children Counseling Groups at Min Zu Elementary School received the Group Golden and Diamond Awards from the Taipei City Government.Children Counseling Groups at Min Zu Elementary School, Jian Kang Elementary School and Fu Lin Elementary School received the Personal Golden and Diamond Awards from the Taipei City Government.The quarterly magazine Gen Shin Garden, published by the Lite-On Children Counseling Group, won the "2002 Education Publication Excellence Award" from the Executive Yuan of the Republic of China.The Lite-On Cultural Foundation was selected to manage the "National Children Counseling Seminar" from 2001 to 2002 by Children's Bureau of Interior R.O.C.
Broadcasting ProgramsThe program, "Love in your community", received the Golden Bell Award (Society Development Award) from the Government Information Office of Executive Yuan in 1997 and received the Broadcast Culture Award (Special Cultural Report Award) from the Council for Cultural Affairs of Executive Yuan in 1998."Searching for the Root", a unit of "Build a New Home", was recognized as Excellent Culture Program and authorized to produce 104 sections by the Council for Cultural Affairs of Executive Yuan in 2001 and 2002."Build a New Home," a radio program broadcasted by the Lite-On Cultural Foundation, won the National Golden Voice Award for the Best Talk Program" in 2002.
Taipei Shin-Yi Community College, managed by the Lite-On Cultural Foundation, won "Excellence Award for Management and Development" from the Bureau of Education Administration of Taipei City Government for the second consecutive year.
The Foundation received "The Group Service Award of Social Education" from the Ministry of Education in 1998.
The Foundation received the "Golden Wen-Xin Award" in 1998 and "Wen-Xin Award" in 2001 from the Council for Cultural Affairs (CCA) of Executive Yuan.
Mr. Paul Chang, the Secretary-General of the Foundation, received "Educational Award" from the Educational and Academic Association, R.O.C. in 2001.
The Foundation was selected to manage an inspection tour for post-earthquake reconstruction, in addition to visiting the culture in Kobe, Japan under the leadership of the Chairman of Council for Culture Affairs with 20 members including government officers, director of the culture centers and professionals.
8.4 Milestones
Managed more than 20 Community Volunteer Seminars.
Promoted diversified cultural activities in various communities in the Great Taipei area.
Promoted cultural activities in Dong Kang of Ping Tong County since 1993 with the involvement of all schools, Town
Halls and Cultural Center of Ping Tong County.
Assisted more than 10 elementary schools and kindergartens to promote children theater education (renamed to
Dynamic Teaching Programs). The program adopts the open learning style, demonstrating the trend of education
revolution and applying methods of dramas in the teaching of kindergartens and elementary schools to build an active
and happy learning environment.
Promoted cultural activities for poetry, painting, plays, music and photograph to improve the "cultural atmosphere" of
enterprises.
Promoted cultural exchange with Mainland China and other foreign countries (such as U.S.A.,UK. Malaysia and Japan).
Lite-On Children Counseling Group provided counseling services to 14 young victims of 921 Earthquake, 8 from Taipei
and 6 from central Taiwan.
O p e r a t i o n a l H i g h l i g h t s
35 36
1 . B u s i n e s s O v e r v i e w
1.1 Business Scope
15%
7%
9%
5%
Opto
Peripheral
Digital Display
Peripherals & Components
Optoelectronic products -- including LED, alphanumeric displays and infrared products for:
Computers and peripherals.Communications and consumer products.Industrial and OA (Office Automation) equipmentAutomotive and automotive related-products, such as traffic lights, outdoor and indoor indication boards, dashboard display in autos and brake lamps.
Power supplies for:Desktop, notebook and high-end office computersAutomation equipmentCommunication and network equipment Printers, faxes, scanners and set-top boxes
Keyboards for:PCsMobile phonesPDAs
CRT color displaysLCD displaysMFM LCD TVsFront and rear projectors
LED lamp and SMD LED (ultra- bright LED and circuit board indicators).
LED display (RGB LED display, numeric display, dot matrix displays, alphanumeric LED displays, graphic LED displays, IC driver built-in LED).
Infrared products (infrared emitting diodes, photodiodes, photo-transistors, photo interrupters, photo couplers, receiver modules, photo links, and IrDA).
Power supplies for desktop and notebook PCs.Power supplies for fax machines, printers and scanners.DC – DC converters.Power supplies for servers and workstations.Power supplies for set top boxes.Power supplies for communication and network equipment.
All types of keyboards
CRT color displays, LCD displays, MFM LCD TVs, projector LCD TV, front and rear projectors.
StrategicBusinessGroups
Strategic Business Units
Major Product Lines Major Products Weight ofBusinessin 2003(%)
64%
Office Consumer &
Solutions
Image Management
Image
Handheld
Solutions
Portable Image Devices
Wireless
Computer Systems
Network Access
Magnetic
Image
Communications
Computers
New Business
Development
Image scanners
Printers
Faxes
PDAs
MFPs
Image-related products
Printers
MFPs
Pocket PCs
PDAs
Smart phones
IA-related devices
Image portable-devices
Wireless and communication
products:
GSM handsets
GPRS handsets
3G handsets
Bluetooth products
Motherboards – Celeron and PIV
Desktop PCs – Bare-Bone
and complete systems
Broadband, WLAN and
communication products:
Network interface cards
Switches
Routers
Internal, external and ADSL
modems
Wireless and networking
products.
Design Transformer
Scanners, printers, scanning
modules, faxes, PDAs and MFPs
Printers and MFPs
PDAs, pocket PCs and wireless
PDAs.
Image portable products.
GSM, GPRS and 3G handsets,
and Bluetooth products.
Motherboards – Celeron and PIV
Desktop PCs – Bare-Bone and
complete systems
NIC
Network Interface Cards,
switches and routers.
Internal, external and ADSL
modems, wireless and
networking products.
Transformer
StrategicBusinessGroups
Strategic Business Units
Major Product Lines Major Products Weight ofBusinessin 2003(%)
37 38
To strengthen R&D for software and System on Chip – In the future, 3C products will become “lighter, thinner,
connected better, cheaper, and saving more”, and should be “ready to use, handy, and easy to use”. Lite-On
Technology will focus on developing the technology of software and System on Chip, as well as the R&D capability
thereof.
To enhance intellectual property – encouraging innovation, controlling patents, creating advantage in unfair
competition, and avoiding repeated R&D time and expenses by professional IP management, as well as reducing R&D
costs.
To establish Lite-On R&D Center – Integrating current R&D technology platforms and promoting e-design in order to
increase the efficiency of R&D and shorten the R&D time; participating more in large scale projects in the production or
governmental fields, in order to upgrade technology level; and recruiting outstanding talents from National Defense
and cooperating with colleges to establish Incubator Centers, in order to contribute to the development of
professionals and further develop R&D capability for the Company.
Electronic Circuit Design, System Integration Design and testing, and software development and integration
R&D for Switch Power Supplier and packaging technology of OPTO semiconductor
Power Electronics
World-System digital video processing
ATSC/DVB-C/DVB-T/DVB-S
Cellular mobile communication in GSM/GPRS, TDMA, WCDMA
Wireless Projection Technology and Digital Image Optical Projection Technology.
High Precision Ink Jet and Laser Printing Technology.
Integration of Opto-Electro-Mechanical Devices
Color Image Processing
High-speed paper feeding
Laser Optics
Wireless, Internet, Communications and OPTO Technology Integration
System Movement Stimulation and Control
Development and design of software, hardware, and facility for PDA and other mobile devices
Development and application of software and hardware for open platform
Design and development of software and hardware for multimedia processing
Software and hardware design for intelligent display devices
Opto-Mechanical module and image capturing module.
Hardware design for OPTO switching
Operation System Design for OPTO Control
Automation Product Testing
Image Processing Analysis and Simulation Technology
Word, Graphic, and Voice Identification Technology
Human-Machine Interface Design
Design of Control Chips for A/D Signals
Unit: Thousand of NT dollars
1.2 Major Future R&D Directions :
1.3 R&D Focus in 2004 :
1.4 Technology Development and R&D Overview
R&D Expenditures
Item 2003 As of March 31st, 2004
R&D Expenditures 1,873,467 432,936
II Successfully Developed Technologies and Products
Category
Display
OPTO
Networking
Major Products
1. Color Monitors (15”, 17”, 19”)
2. Planar LCD Monitors (17”, 19”)
3. LCD TV
4. MFM LCD TV
1. Lamp Light Emitting Diode (Lamp LED)
2. Surface-Mounting Device Light Emitting Diode (SMD LED)
3. Signal Digital Light Emitting Diode (Single Digital LED)
4. IrDA Communication Module
5. Line Dot Matrix Light Emitting Diode (Line Dot Matrix LED)
6. Infrared Coupler
7. Infrared Light Emitting Diode (Intared LED)
8. Infrared Detector
9. OPTO switch
10. Active Display
11. Micro SMD Coupler
12. New Style 4Mbps Fir IrDA Product Packaging
13. New Style AIInGap/GaN Ultra-Bright LED
14. PDIC Detector
15. Plastic Optical Fiber Digital Stereo Connector
1. NIC
2. Network Switching Hub
3. Routers
4. Broadband Gateway
5. Power Line Network Equipment
6. Bluetooth Wireless Modem Communications Products
(IAD with built-in VOIP Function)
7. 1394 Interface Card
8. 10/100 NIC Card
9. Power line/ Wireless / VPN / Firewall Router
10. 24/48 Port L2 Intelligent Switch
11. 16/24 Port Smart Switch
12. Wireless LAN 802.11b, 802.11a/802.11g, 802.11/a+b combo, 802.11b/g/a
13. ADSL Modem
39 40
Lite-On Technology is strategically positioned as a global leading provider of Optoelectronics components. Lite-On Technology's
major products, including Digital Display, Power Supply, Imaging products and LED, account for 76% of the 2003 global
consolidated revenue. The market and sales analysis for Lite-On Technology's major products are as follows:
(1) Optoelectronics
According to IEK, the market size of Light Emitting Diode (LED) reached US$4.3 billion in 2003, 11% increase from 2002.
IEK also estimates the market size to grow 12% to US$4.8 billion in 2004. During the early stages of the LED development,
application for LED was limited to the point source for consumer and electronic products. However, as LED brightness and
efficiency have improved since 2000, LED has become the key source of backlight for portable devices including mobile
phones and PDAs. The upsurge in these portable devices over the recent years also strengthened the growth of LED.
LED products can be divided into two categories, visible and invisible. The market for visible products such as Infrared has
stabilized as demand has not picked up for short-distance wireless communication. Visible LED, on the other hand, has
grown considerably due to the improvement of brightness and emitting efficiency. The technology development coupled
with the continuous cost-cutting efforts by LED vendors in Taiwan led to an escalation in market demand for LED.
(2) Digital display
According to Gartner, the demand for desktop displays in 2004 will grow 12% from 127 million units in 2003 to 141 million
units. While LCD monitors account for 37% of the desktop display market in 2003, this figure is to grow to 48% in 2004
and 65% in 2005. In 2005, the worldwide market for LCD monitors will officially surpass that of the CRT monitors. Gartner
estimates that LCD monitor shipment will grow at a strong 2004-2008 CAGR of 22.5%. In 2008, the demand for CRT
monitors will shrink to less than 10% while LCD monitors occupy 90% of the worldwide desktop display market.
LCD and CRT products each account for 45% and 55% of the monitor output of Lite-On Technology in 2003 respectively.
The shipment of LCD has doubled since 2002. Aside from serving global leading PC providers for their bundle packages, the
Company continues to endeavor in cultivating LCD sales by winning more orders. While customers increase the purchase of
LCD monitors, the percentage of LCD monitors is expected to increase 10% - 15% and to account for 55% - 65% of the
total sales of monitors with the decrease in CRT sales.
Global Market size of LED (2000 - 2004 estimated) (unit: million)
Source: IEK, January 2004
6,000
5,000
4,000
3,000
2,000
1,000
0
LED
2000 2001 2002 2003 2004
3,737 3,321 3,870 4,304 4,796
Category
Handset
PC System
Image
H.I.S
Major Products
1. GSM Mobile Phone
2. GPRS Mobile Phone
1. Mother Board - Celeron & PIV (Models of uATX, ATX)
2. Desktop - Bare bone system
3. Desktop - Complete System
1. High - End Inkjet Printers
2. Laser Printers
3. Multi-functional Peripheral for printing, scanning, copying and faxing.
4. Ultra Thin CIS color Scanners
5. High Definition CCD Speed Dial Color Scanner
6. Color CCD and CIS Scanner Module
7. Copier Image Scanning Modules
8. Surface Mounted Technology and PCB Assembly
9. Thermal transfer printer
10. Wireless Module
11. PDA
12. Personal Media Player
13. Camera Module
14. Digital Camera
1. DT Keyboard
2. Smartcard Keyboard
3. NB Keyboard
4. Slim Keyboard
5. 27Mhz RF Keyboard & Mouse
6. Bluetooth Wireless Keyboard
7. Internet Phone Keyboard
II Successfully Developed Technologies and Products
2 . Market and Sales Overview
2.1 Market and Sales Analysis
Major Products of the Company :
41 42
According to Display Search, LCD TV shipment will reach 8.1 million units in 2004, up 104% from the 3.9 million
units in 2003. Though growth may slow down after 2004, LCD TV shipment is estimated to continue escalating
with high growth rates, reaching 30 million units by 2007. This explosive growth can be attributed primarily to the
increase in the supply of large-size panels, in addition to the demand for 2004 Athens Olympics and the emerging
broadcasting technology, Digital TV. Special features of LCD TV will also promote the growth on the demand end,
including its absence of radiation and lower power consumption.
With the customers' approval on the quality of the LCD TVs, Lite-On Technology has started shipping 17" MFM
LCD TVs since 4Q in 2003. The shipment in 2004 will increase substantially, making LCD TV another strong
driving force for the Digital Display products of Lite On Technology.
Global LCD monitor shipment (2000 - 2008 estimated)
Source: Gartner Feb.2004
200,000
150,000
100,000
50,000
0
CRT(000)
LCD(000)
2000 2001 2002 2003 2004 2005 2006 2007 2008
112,253 98,070 83,376 79,554 73,563 53,881 40,335 23,569 16,979
6,771 15,762 32,424 47,093 67,904 100,065 121,004 139,090 152,813
Global Output of LCD TV (2000 - 2007 estimated)
Source: Display research, 2003
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
LCD TV(000)
2000 2001 2002 2003 2004 2005 2006 2007
181 615 1,351 3,968 8,076 13,062 23,981 31,081
Scanner
Scanners have traditionally been a popular bundle choice of on-line PC purchace which saw strong demand in the past few
years. However, as digital cameras gain popularity, scanners are being replaced, result of which is the decrease in demand.
In addition, the emergence (MFPs) has also helped shrinking the scanner market as the price gap between MFPs and the
traditional scanners squeezes. Lite-On Technology expects to see the trend become more evident in the future. According to
IDC, worldwide scanner shipment in 2003 reduced 7% to 15.3 million units. IDC also estimates 2004 to see the scanner
market further scaled down to 14.7 million units, down 3% from the 15.3 million units in 2003.
Source: Gartner, Feb 2004
Global shipment units of printers (2000 - 2008 estimated)
66,00064,00062,00060,00058,00056,00054,00052,000
Printer(000)
2000 2001 2002 2003 2004 2005 2006 2007 2008
64,665 63,991 58,938 63,503 65,213 66,898 68,969 66,725 64,480
Source: IDC,May,2003
Global Shipment Units of Flatbed Scanners (2001 - 2007 estimated)
20,00018,00016,00014,00012,00010,0008,0006,0004,0002,000
0
Scanner(000)
2001 2002 2003 2004 2005 2006 2007
18,666 16,461 15,273 14,694 14,408 14,335 14,472
(3) Image Products: Printers, Scanners, and Multi Function Printers Products
Printer
According to Gartner, the total global output of inkjet printers was 63 million units, up 7% from 2003. The global
production of inkjet printers will reach 65 million units with an annual growth rate of 3%.
In addition to the launch of Multi Functional Printer (MFP), the single-function printers are also being replaced by the
emerging Photo Printers, which have become the most popular products with the promotion from HP, Epson and other
global printer manufacturers. Lite-On Technology is planning strategically to step into the field of photo-printing in 2004.
43 44
b. The global SPS technology is trending toward modulization, miniaturization, integration and high-frequency.With the dramatic development of IC processing technology, electronic products continue to become smaller and cheaper, as do their
power supply component. (See Chart 1 below) As power supplies are required to handle rated power, the application of IC
technology is more difficult to integrate. As a result, power supply remains a major obstacle in making electronic devices smaller
and cheaper. In order to overcome this problem, the development of SPS technology is moving in four directions: modularization,
miniaturization, integration and higher frequency. With much room for further growth, manufacturers are still able to stay
competitive via product differentiation and portfolio diversification. Thus, the SPS manufacturers with leading technology and scale
have still been able to maintain favorable sales and profit gains amid fierce competition in a maturing market.
a. SPS manufacturers in Taiwan are actively pursuing the market outside of PC.
The market of the local SPS industry in Taiwan is still focused on exportation, making Taiwan the No.1 Power supply vendor
for PC's. Even though the industry's big players are getting bigger, Taiwan's PC SPS share is expected to keep growing. The
communications industry is the secondary market for SPS, with 30% of overall market. At present, SPS for non-PC
products represents about 12% of Taiwan's overall SPS output, indicating that there is still ample room for future growth in
the non-PC sector. The explosive growth of smart handhelds witnessed worldwide indicates that the demand for compact
and low-cost SPS will see rapid increase.
Global shipment units of inkjet MFP (2000 - 2008 estimated)
Source: Gartner,Feb,2004
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
MEP(000)
2000 2001 2002 2003 2004 2005 2006 2007 2008
5,882 8,028 10,174 19,569 30,997 41,453 51,485 58,877 63,269
Multi Function Printers (MFPs)
MFP integrates the function of copying, printing and scanning into one. The 4-in-1s represent a printer with the above
mentioned features plus the faxing capability. MFPs have become a critical office item to reduce cost and save space in
enterprises. U.S. and Europe currently account for over 70% of the global MFP market. According to Gartner, global MFP
shipment reached 19 million units in 2003, up 90% from 2002. IDC further expects the market to see 30 million units with
an annual growth rate of 63%.
Lite-On Technology has had extensive experiences in manufacturing printers and scanners. As of 2003, Lite-On Technology
owns 24% of flatbed scanner market. Lite-On Technology expects to see MFPs integrating more functions in 2004.
(4) Switching Power Supply
The Switching Power Supply (SPS) market has been growing steadily, however with the application of SPS still focused
mainly upon IT products. Statistics from MicroTech Consultants indicate that the global market value of SPS was about
US$173 billion in 2003, with slight increase from 2002. The market value of 2004 is estimated to be US$174 billions with
an annual growth rate of 2%. Because of a wide variety in applications, SPS not only has been little influenced by the
short-term downturn of the IT industry, but has been able to maintain steady growth. SPS products can be categorized into
two types of products, AC/DC converters with space 73% share and DC/DC converters with 27%. Currently, SPS for IT
products is the primary application with 43% market share, followed by communication and industrial equipment, at 20%
and 16% respectively.
Source of Information: Energy & Resource Laboratories of Industrial Technology Research Institute
Chart 1 Global Development of SPS Products
Trend Note
The range of SPS application is wide, with different IT product structures requiring different circuit designs, and specification requirements from customers serving as the standard of design and production. Therefore, automatic mass production and major upstream components, such as adapters, may be replaced by power modular IC.
While electronic products are getting significantly smaller, SPS must do the same. As a result, the components of SPS must offer small size, lightweight, and higher efficiency and frequency. Components such as adapters, electronic sensors, and capacitors used for wave filtering will help achieve compactness and lightness along with increases in switching frequency.
Integration is important for SPS miniaturization, resulting in miniaturization of adopted components and radiator surface. Smaller radiator surface creates a temperature increase. So, loss of power inside circuit must be reduced to solve the electrical- and heat-related insulation problems.
High frequency allows SPS to achieve miniaturization, although the technology is not limited to circuit methods, and can be related to semiconductor components, magnetic components, capacitors, control circuit, and assembly technology. The challenge is to develop a circuit with limited loss of high frequency and limited components.
Modularization
Miniaturization
Integration
High Frequency
Focus primarily on exportation, the Lite-On Technology's customers are located worldwide, including U.S., Europe, Japan, China, and South East Asia.
Distributing Areas of Major Products
Global market shares for the Company's major products in 2003 are:
Global Market Shares
Major Products
Monitor (CRT/LCD)Mobile PhonePC SystemsAnalog ModemsLED & OptoSPS (DT/NB/Server)Image Products PC Keyboards
2003 Market Shares ( percentage)
5%1% 1%15%6%12% / 33% / 24%25%20%
45 46
Following are estimates on market scale and growth associated with the Company's major products by renowned research
institutions, such as IDC and Garther.
Future Supply, Demand and Growth
(1) Lite-On Technology is equipped with unparallel R&D capabilities. For any of Lite On Technology's products, including
display, peripherals and components, printers, scanners, networking and wireless, the Company offers total solution
and one-stop shop to differentiating itself from conventional EMS/ODM suppliers.
(2) As for Image products, Lite-On Technology owns the design technology and production capability for scanner and inkjet
printer modules. This makes Lite-On Technology the number-one choice for ODM/OEM by global customers.
(3) In terms of digital display products, Lite-On Technology has proven the economies of scale, as well as maintenance of
good relationships with key component suppliers to achieve flexibility in better serving the customers.
(4) In terms of component products, Lite-On Technology has the advantage in the ability to integrate the upstream and the
downstream, allowing Lite-On Technology to be ahead of the industry in new product development.
(5) Today's global market is driven by demand for products with shorter lifecycles which require continuous innovation, cost
reduction and better customer service. These concerns are shared throughout the IT and electronics industries. Lite-On
Technology's highly efficient and dedicated management team excels at running a multinational enterprise, tackling
approaching challenges in ways that continue to add value to our competitive advantage.
Competitive Niche and Development Vision
Market Related to the Company’s Major Products
CRT Monitor
LCD Monitor
PC Systems
Mobile Phone (GSM/GPRS/CDMA)
SPS (DT/NB/Server)
MFP (Inkjet/Laser)
Printers (Inkjet/Laser)
Scanners (excluding MFP Scanning Module)
Keyboards for DT PC
Keyboards for NB PC
Estimated Market Scale in 2004
more than 50,000k units
more than 63,000k units
more than 100,000K Units
more than 500,000K Units
more than 100,000K/40,000K/7,500K Units
more than 8,000K Units
more than 70,000K Units
more than 14,000K Units
more than 10,000K Units
more than 40,000K Units
Estimated Compound Growth Rate in the Next 2~3 Years (%)
about -18%
20 ~ 25%
5%
more than 10%
5%~10%
about 15 ~ 20%
about 5%
about -2.5%
10 ~ 13%
15 ~ 20%
2.2 Main Function of Major Products
Product
Monitor
Projector
PC
Motherboard
NIC
Switch
ADSL
Analog Modem
ADSL Modem
Gigabite Ethernet Card
Power line
GSM/GPRS
Optoelectronics
Switching Power Supply
Image
Human Input Solution
Personal Image Device
Main Function
For PC and workstation use, and to assist terminal display of CAD/CAM models, image layout, internet-based information, and multi-media interactive images.
For conference, presentation, home theater and entertainment.
For home and office use.
For general PC use.
Equipment to connect a PC terminal to the Internet.
Network center hub to control the Internet traffic and central management.
A safety screen gateway between home network and broadband Internet to prevent hacker intrusion, and enabling multiple users to share the same Internet account as IP sharing functions.
Digital-to-analog and vice-versa signal converter, necessary for a PC to access the Internet.
High-speed transmission specification that is 30-to-120 times faster than the 56K modems. A mainstream communication product.
High-speed Internet transmission for enterprise and personal use.
Physical connection providing PC access to the Internet, ideal for family Internet access use.
A widely applied global telephone system, especially for mobile phones (voicemail and information transmission).
Widely applied in communications network, computer, and peripheral-related products, including consumer electronic products, automation facilities, medical treatment equipment, traffic signs and industrial indicators, Opto switches, display panels for indoor and outdoor use, car panels, stereoes, brake lights, wireless information transmission products, and more.
Provides high-quality power supply for PCs, communication, and automation facilities in enterprise and personal use.
Scanning, printing, copying, faxing input/output-related products and Internet-related products, such as PDAs
Computer keyboards and input devices for the Internet and e-business.
Built-in P.I.D. for mobile phones and portable devices.
Unfavorable Factors and Responses
Unfavorable Factors Responses
1. Close connection with the fluctuation in global
economy.
2. The great impact of exchange rate change on the
profits
1. Diversify the product portfolio to manage risks in the
fluctuations of the global economy.
2. Establish risk-managing measures against exchange-rate
risk responding to the fluctuation of exchange rates.
47 48
D i s p l a y 6,000 5,100 28,881,300 6,887 6,363 42,013,907
P C S y s t e m 7,920 1,638 9,309,414 5,031 2,484 8,707,496
N e t w o r k i n g 15,200 3,703 1,332,526 17,460 9,636 3,943,059
H a n d s e t 1,338 945 2,005,650 8,400 4,054 5,933,337
O P T O 1,275,400 513,084 880,312 2,423,866 2,423,866 3,624,903
P o w e r 5,000 5,394 2,613,012 44,453 44,453 15,851,827
I m a g e 553 553 937,314 6,352 6,318 8,950,339
H . I . S 2,313 2,313 441,339 10,865 10,865 1,132,137
To t a l 1,313,724 532,730 46,400,867 2,523,314 2,508,039 90,157,005
D i s p l a y
P C S y s t e m
N e t w o r k i n g
H a n d s e t
O P T O
P o w e r
I m a g e
H . I . S
O t h e r s
To t a l
20 288,174 5,045 28,494,427 18,350 6,556 41,856,374
7 31,970 1,631 9,277,444 10 152,647 2,067 9,241,850
188 142,237 2,870 1,483,804 130 63,712 11,021 4,999,815
297 406,256 1,290 3,132,043 960 1,429,849 3,199 5,413,837
112,913 157,639 394,347 720,033 390,776 950,155 2,770,332 4,888,495
1,120 376,030 4,274 2,180,010 8,390 2,317,875 35,512 14,502,190
634 1,432,539 2,012 459,170 4,036 10,110,330
89 21,277 2,359 561,354 616 78,920 16,027 3,286,145
115,323 465,849 17,438 1,127,907
114,634 1,538,906 412,450 47,747,503 402,894 5,488,116 2,848,750 95,426,943
All foreign and domestic Lite-On Technology factories retain a cooperative, long-term relationship with material
suppliers. In terms of component supplies, Lite-On holds regular meetings with strategic suppliers to exchange
information on market supply and price trends. In turn, the suppliers are able to provide goods on time and help Lite-
On achieve competitive production costs through reasonable pricing. This leads to smoother, more cost-effective
production and enables Lite-On to provide customers with the best goods and services.
Notes: 1. Productivity means the capacity to produce by current facilities under normal operation, after taking into concerns on shut down and holidays.
2. If one product can substitute another, we will merge the production capacity and attach a detail description. 3. Calculation Method:
For 2002, Lite-On Technology has included Lite-On Technology annual production, and the 2002 November and December production value of Silitek Corp, Lite-On Electronics, and GVC Corp. are included.
Notes: 1. Calculation Method:For 2002, Lite-On Technology has included Lite-On Technology annual sales volume and value, and the 2002 November and December sales volume and value of Silitek Corp, Lite-On Electronics, and GVC Corp. are included.
2.3 Status of Material Supply 2.5 Production volume in the past two years:
2.6 Sales volume in the past two years:
Unit: Thousand of NT Dollars
Lite-On 12,762,118 13%
Trading USA,
Inc.
NMV 6,178,013 13% 9,835,168 9%
Due to the impact of the four-in-one merger, economic recovery in the industry as well as the complete product lines of the Company, key technical platform, one-stop shopping and professional R&D team, the sales revenues from major customers of 2003 increases significantly comparing to that of 2002. Established in April 2003, Lite-On Trading USA, Inc. mainly manages US domestic sales to provide customers excellent channels for purchase and after sales service and contributed to significant growth in sales.
2.4 List of Major Customers
List of Major Customers in the Past Two Years
2002 2003Name of Customer Amount % of Annual Sales Amount % of Annual Sales
Titanic Capital 21,691,320 49% 40,914,485 45%
Service
Yet Foundate Ltd. 1,370,664 3% 10,350,090 11%
Great Adelphi Intl. 5,442,436 12% 6,198,835 7%
Lite-On Computer 4,420,007 10% 2,543,098 3%
Technology (DG) Ltd.
Unit: Thousand of NT Dollars
The purchase amounts of products from Titanic Capital Service, Yet Fundate Ltd, Great Adelphi Intl. and Lite-On Computer Technology (DG) Ltd that are all subsidiaries of the Company as well as oversea production sites, have been increased dramatically due to significant sales growth resulting from the impact of merger and economic recovery in the industry.
List of Major Suppliers in the Past Two Years
2002 2003Name of Customer Amount % of Annual Sales Amount % of Annual Sales
Unit: Thousand of parts, sets, or NT Dollars
Unit: Thousand of parts, sets, or NT Dollars
2002 2003
2002 2003
Productivity Volume Value Productivity Volume ValueProductionvalue
Major Product(or by SBU)
Year
ProductionvalueMajor Product
(or by SBU)
Year
Domestic Sales Export Sales
Volume Value Volume Value Volume Value Volume Value
Domestic Sales Export Sales
49 50
4000
3000
2000
1000
0
Staff
Direct Labor
Total
Average Age
Average Years ofEmployment
100
90
80
70
60
50
40
30
20
10
0
2,608 2,739 2,724
1,003 696 622
3,611 3,435 3,346 31.53 32.45 32.87
3.43 3.85 3.78
Ph. D. 0.30%
MS / MA 13.65%
College 65.27%
High School 17.48%
Others 3.29%
Ph. D. 0.62%
MS / MA 17.85%
College 67.63%
High School 9.44%
Others 4.46%
Ph. D. 0.59%
MS / MA 18.46%
College 69.17%
High School 8.62%
Others 3.16%
Lite-On Technology has long recognized an enterprise’s responsibility to protect the environment. Lite-On believes that a company can only be truly
recognized as a responsible global company when it is environmentally aware and has demonstrated this belief by proactive corporate initiatives.
Lite-On Environmental Protection Goals:
To ensure minimum impact on the environment during research, development, manufacturing, and servicing processes.
To comply with environmental protection laws and regulations, as well as related environmental protection requirements from government agencies.
To instill a sense of responsibility for environmental protection in all employees, fostered a shared commitment as responsible global citizens.
To provide necessary environmental protection training to all relevant personnel to enhance employee sensitivity to and awareness of environmental
protection.
To establish a self-evaluation mechanism promoting pollution prevention and continuous environmental improvements.
At present, following Lite-On’s commitment to environmental protection, manufacturing processes and material used in all company factories are
pollution free and comply thoroughly with all CFC regulations. Furthermore, all waste is handled by qualified handling firms, in compliance with the
regulations of the Environmental Protection Administration.
In the future, Lite-On Technology will continue its commitment to pollution prevention and environmental improvement programs.
The policy of green products is set up in Lite-On Technology for each of business departments to comply with:
Prevent use, manufacturing and sales of products containing environmentally controlled materials to carry out the concept of environmental
protection.
Comply with regulations of RoHS to meet customers’ needs.
Build a platform of green supplier management to work with suppliers and customers for environmental protection.
5.1 Lite-On Technology values its relationship with employees. The Company continues to endeavor toward enhancing communications between
management and staff in all departments, with focus on key objectives, capabilities, and functions. In addition, internal communication meetings
are periodically held by top management to keep employees informed of the strategic directions of the Company. An employee hotline and an
employee suggestion box also keep communication open between employees and management.
5.2 Lite-On Technology views the talents of its employees as a major asset. To encourage advancement, the company devotes considerable resources
to employee training programs. The Company also provides a variety of training programs for all management levels to keep them well informed
in today's unpredictable business environment. Lite-On Technology invites distinguished college professors to conduct courses, and well-known
lecturers from the Institute of Information Industry (III) to share current industry trends. The Company also invites respectable public figures to
disclose their interests and achievements in different aspects of life to encourage employees to pursue a more balanced professional and personal
lifestyle.
5.3 Lite-On Technology has formed an Employee Welfare Committee, Retirement Pension Supervision Board and Safety & Health Committee to oversee
administration of the employee benefits. Lite-On Technology has also established safety and health practices. The Company's policies, systems,
and other welfare measures are delivered through internal training programs and the bi-monthly "Lite-On" internal publication.
5.4 No damages or losses were incurred by labor disputes in the year 2003.
3 . Personnel Growth over the Last Two Years 4 . Environmental Protection Expenditures
5 . Labor Relat ions
Based on data of in-house employees for the last 2 years and up to April, 30th . 2004
2004 (as of April 30th, 2004)2002 2003
Percentage byEducation
Background
51 52
1. A lawsuit of quality argument is filed between the Company’s display department and Viewsonic. The two parties have agreed upon
a private settlement in March 2004 and withdrew the initial lawsuit. A settlement agreement is planed to be signed in May 2004.
2. Bureau of Environmental Protection of Taichung City lodged an accusation against the former GVC Corp. for waste disposal and
required the Company to verify the obligations of all carriers. The Company shall seek compensation of transportation expenses
shared by these carriers. Currently, the transportation expenses cannot be estimated. This case resulted from subcontractor of the
qualified waste-disposing company authorized by the Company and may be involved in a violation of administrative disciplinary
action regulated by the Bureau of Environmental Protection on the Company for the waste transportation expenses. Therefore, the
Company has filed a lawsuit against such administrative disciplinary action, which has been withdrawn by the Taichung City
Government.
3. Lite-On has received a court-ordered compensation of US$4.4 million as a result of debt collection by the former GVC Corp. in the
U.S. It is confirmed that the Client does not have the asset. The Company has filed a lawsuit against the owner of the Client.
6 . I m p o r t a n t C o n t r a c t s
6.1 Major Business Contracts
6.2 Bank Contracts
Terms
3.08.1999~ 3.07.2004
5.18.2001~ 5.18.2006
7.23.2001~ 7.23.2004
8.08.2003~ 8.08.2008
Content
Extend CP Every Three Months
Middle or Long-Term Secured Loan
Revolving CP
Middle or Long-Term Loan
Restriction Clause
Required to MaintainCertain Financial Ratio
Required to MaintainCertain Financial Ratio
Required to MaintainCertain Financial Ratio
Required to MaintainCertain Financial Ratio
Party
ABN AMRO Bank, Taiwan
Chiao Tung Bank, Taiwan
ABN AMRO Bank and other 9 Participant Banks in Taiwan
Citibank and other Participant Banks in Taiwan
Nature of the Contract
CP Revolving Credit Limit (Note 1)
Long Term Loan (Note 1)
CP Revolving Credit Limit (Note 1)
SyndicationLoan Agreement
Nature of the Contract
ODM/OEMAgreement
Sales Agreement
Cross-LicenseAgreement
Parties
Confidential
Confidential
Osram
Terms
Confidential
Confidential
Confidential
Restriction Clause
Confidentiality
Confidentiality
Confidentiality
Description
Manufacturing monitors, power supplies, scanners, keyboards, multi-function peripherals, mobile phones, modems and other products.
Sales of color monitors and optpelectronic component products.
Cross-licensed to manufacture and sell white LEDs with conversion technology.
Note 1: Originally signed by Silitek Corporation.
As of April 30, 2004
As of April 30, 2004
7 . Major Legal Proceedings and Contingencies
April 30, 2004Units : Thousand of NT Dollars
8 . Assets Acquisition or Disposition
Lite-On Technology Corporation :
Ta Chong Bond Fund
Chung Hsing Ping-An Bond Fund
First Global Investment Trust Duoli Bond Fund
First Global Investment Trust Duoli-2 Bond Fund
First Global Investment Trust Wan Tai Bond Fund
Jih Sun Bond Fund
Tai-Yu Long River Bund Fund
Solomon Bond Fund
Phoenix Bond Fund
Kirin Bond Fund
Mega Diamond Bond Fund
JF Taiwan Bond Fund
JF First Bond Fund
Fuhwa Bond Fund
TIIM Bond Fund
PCA Bond Fund
2003/10 – 2004/02
2003/04 – 2004/04
2004/02 – 2004/04
2004/04
2003/01 – 2004/04
2003/03 – 2004/04
2003/04 – 2004/02
2003/01 – 2004/04
2004/02 – 2004/04
2003/07 – 2004/04
2003/02 – 2004/04
2003/04
2003/01 – 2003/02
2004/01 – 2004/04
2003/02 – 2004/04
2003/04 – 2004/04
1,000,000
2,080,000
700,000
500,000
2,600,000
1,700,000
850,000
2,600,000
520,000
310,000
2,450,000
500,000
300,000
350,000
2,790,000
1,100,000
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Assets Acquisition Date(yy/mm) Purchase Price Relation with
the CompanySeller Purpose
8.1 Major Asset-Related Transactions of Lite-On Technology Corporation and Subsidiaries Occurred in 2003 and as of April 30, 2004:
Major Assets Acquisition:
53 54
Major Assets Acquisition: April 30, 2004Units : Thousand of NT Dollars
Lite-On Technology Corporation :
PCA Well Pool Fund
Prudential Financial Bond Fund
NITC Taiwan Bond Fund
NITC Bond Fund
Barits Bond Fund
Increment Securities Investment Trust Fund
Sheng Hua 1699 Bond Fund
James Bond Fund
ABN AMRO Select Bond Fund
KGI Victory Fund
Fubon Ju-I Fund
Truswell Bond Fund
Invesco GP R.O.C. Bond Fund
Shinkong NT$ High Yield Fund
Shinkong Chi-Shin Fund
Dresolner Bond Fund
United Bond Fund
Union Bond Fund
Polaris De-Li Bond Fund
Polaris De-Bao Bond Fund
Lite-On International Holding Co., Ltd.
GVC (Cayman) Corp.
Lite-On Enclosure Inc.
Neihu Office Building
2003/01 – 2004/04
2003/01 – 2004/04
2004/02 – 2004/04
2003/10 – 2004/01
2003/01 – 2004/02
2003/04 – 2004/04
2003/01 – 2004/04
2003/01 – 2003/02
2003/01 – 2004/02
2003/04 – 2003/11
2004/02 – 2004/04
2003/09 – 2004/04
2003/01 – 2004/04
2004/04
2003/01 – 2004/01
2003/02 – 2004/01
2003/02 – 2004/04
2003/04 – 2004/04
2003/01 – 2004/01
2003/12 – 2004/01
2003/01 – 2003/12
2004/01 – 2004/04
92/10 - 2004/04
2003/01 – 2003/06
2,200,000
1,980,000
750,000
950,000
2,800,000
1,850,000
1,275,000
300,000
2,300,000
450,000
1,000,000
1,850,000
1,400,000
500,000
1,700,000
2,100,000
1,580,000
800,000
2,650,000
600,000
695,553
350,333
834,484
300,701
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
Director and
manager of
Lite-On
Enclosure Inc.
None
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Assets Acquisition Date(yy/mm)
PurchasePrice
Relation with the CompanySeller Purpose
Major Assets Acquisition: April 30, 2004Units : Thousand of NT Dollars
Lite-On Capital Inc. :
MEGA Diamond Bond Fund
NITC Bond Fund
Increment Securities Investment Trust Fund
Chung Hsing Ping-An Bond Fund
Lite-On IT Corporation :
NITC Bond Fund
Invesco GP R.O.C. Bond Fund
ABN AMRO Bond Fund
Prudential Bond Fund
Union Bond Fund
First Global Investment Trust Duoli-2 Bond Fund
Polaris De-Li Bond Fund
Wanpao Security Investment Trsut Fund
Sheng Hua 5599 Bond Fund
Grant Cathey Bond Fund
JF First Bond Fund
President James Bond Fund
Fubon Ju-I II Fund
Polaris De-Bao Bond Fund
Solomon Bond Fund
B.B. Bond Fund
ABN AMRO Select Bond Fund
JF Taiwan Bond Fund
Prudential Well Pool Fund
The First Global Investment Trust Wan Tai Bond
Fund
2003/01 – 2004/04
2003/01 – 2003/12
2003/01 – 2004/03
2003/11 – 2004/03
2003/03 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
2003/04 – 2004/04
2003/06 – 2004/04
2003/02 – 2004/04
2003/07 – 2004/04
2004/02 – 2004/04
2003/04 – 2004/04
2003/01 – 2004/04
2003/03 – 2004/04
2003/05 – 2004/04
2003/04 – 2004/04
2003/03 – 2004/04
2003/03 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
545,000
800,000
1,200,000
370,132
1,950,000
2,140,000
2,530,000
870,000
1,450,000
1,450,000
1,610,000
680,000
850,000
1,450,000
1,660,000
1,485,000
1,120,000
2,530,000
1,740,000
2,340,000
2,240,000
1,450,000
1,850,000
1,660,000
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Assets Acquisition Date(yy/mm)
PurchasePrice
Relation with the CompanySeller Purpose
Solectron
( Singapore) and
Da Yi Liu, Zong De
Song and etc.
METROPOLITAN
CONSTRUCTION
CO., LTD el
The Neihu Office Building
has been set aside to Lite-
On Real Estate
Management Company on
July 1st, 2003 and signed a
leasing contract with the
Company for the purpose
of office building.
55 56
Major Assets Acquisition: April 30, 2004Units : Thousand of NT Dollars
Lite-On IT Corporation :
Barits Bond Fund
Dresdner Bond Fund
Cathay Bond Fund
The First Global Investment Trust Duoli
Bond Fund
The IIT High Yield Fund
Sheng Hua 1699 Bond Fund
President Homerun Bond Fund
Fubon Ju-I Bond Fund
Prudential Bond Fund
Shinkong Chi-shin Fund
KGI Victory Fund
Capital International Bond Fund
Shinkong Chishun Fund
TIIM Bond Fund
NITC Taiwan Bond Fund
Ta Chong Bond Fund
HSBC NTD Money Management Fund
Fubon Ju-I 3 Bond Fund
Transcend Fortune Bond Fund
Far Eastern Alliance Taiwan Bond Fund
UBS Taiwan Bond Fund
UBS Soaring Eagle Bond Fund
The IIT Increment Fund
AIG Taiwan Bond Fund
Mega Diamond Bond Fund
Chung Hsing Ping-An Bond Fund
2003/01 – 2004/04
2003/01 – 2004/04
2003/03 – 2004/04
2003/03 – 2004/04
2003/04 – 2004/04
2003/04 – 2004/04
2004/04 – 2004/04
2003/01 – 2004/04
2003/04 – 2004/04
2003/03 – 2004/04
2003/03 – 2003/04
2003/04 – 2003/07
2003/04 – 2004/04
2003/05 – 2004/04
2003/05 – 2004/04
2003/05 – 2004/04
2003/03 – 2004/04
2003/10 – 2004/04
2003/11 – 2004/04
2003/06 – 2003/10
2003/03 – 2004/04
2003/03 – 2004/04
2003/04 – 2004/04
2004/01 – 2004/04
2004/01 – 2004/04
2004/01 – 2004/04
1,660,000
1,810,000
1,950,000
1,740,000
1,450,000
595,000
892,000
1,710,000
1,660,000
2,030,000
580,000
4,200,000
1,450,000
2,650,000
1,260,000
1,660,000
1,550,000
690,000
1,080,000
5,900,000
1,450,000
2,320,000
1,620,000
580,000
580,000
580,000
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Assets Acquisition Date(yy/mm)
PurchasePrice
Relation with the CompanySeller Purpose
April 30, 2004Units : Thousand of NT Dollars
Lite-On IT Corporation :
United Weili Bond Fund
Ta Chong Gallop Bond Fund
HSBC NTD Money Management Fund 2
Truswell Bond Fund
Truswell Premier Fund
High Yield Group Co., Ltd
GVC (Cayman) Corp.
G-Tech USA, Inc.
Lite-On International Holding Co., Ltd. :
Lite-On USA Holding Co., Ltd.
Lite-On USA Holding Co., Ltd.
Lite-On Technology USA Co. Ltd.
Lite-On Technology USA Co., Ltd. :
Lite-On Trading USA Inc.
High Yield Group Co., Ltd.
Lite-On Opto Technology (Guang Zhou) Ltd.
2004/01 – 2004/04
2004/01 – 2004/04
2004/01 – 2004/04
2004/02 – 2004/04
2004/02 – 2004/04
2003/01 – 2003/12
2004/03 - 2004/03
2003/01 – 2003/12
2003/01 – 2003/12
2003/01 – 2003/12
2003/01 – 2003/12
790,000
580,000
780,000
580,000
580,000
372,892
USD 10,500
USD 20,000
USD 20,000
USD 12,000
USA 13,410
None
None
None
None
None
None
None
None
None
None
None
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
None
Assets Acquisition Date(yy/mm)
PurchasePrice
Relation with the CompanySeller Purpose
Note: List includes only the assets whose acquisition price reaches 20% of the real capital or NTD300 million.
57 58
Major Assets Disposition:
Lite-On Technology Corporation :
Ta Chong Bond Fund
Chung Hsing Ping-An Bond Fund
First Global Investment Trust Wan
Tai Bond Fund
Jih Sun Bond Fund
Tai-Yu Long River Bund Fund
Solomon Bond Fund
Kirin Bond Fund
Mega Diamond Bond Fund
JF Taiwan Bond Fund
JF First Bond Fund
TIIM Bond Fund
PCA Bond Fund
PCA Well Pool Fund
Prudential Financial Bond Fund
NITC Bond Fund
Barits Bond Fund
Increment Securities Investment
Trust Fund
Sheng Hua 1699 Bond Fund
James Bond Fund
ABN AMRO Select Bond Fund
KGI Victory Fund
Fubon Ju-I Fund
Truswell Bond Fund
Invesco GP R.O.C. Bond Fund
2003/10 – 2004/02
2003/04 – 2004/04
2003/01 – 2004/04
2003/03 – 2004/04
2003/04 – 2004/02
2003/01 – 2004/04
2003/07 – 2004/04
2003/02 – 2004/04
2003/04
2003/01 – 2003/02
2003/02 – 2004/04
2003/04 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
2003/10 – 2004/01
2003/01 – 2004/02
2003/04 – 2004/04
2003/01 – 2004/04
2003/01 – 2003/02
2003/01 – 2004/02
2003/04 – 2003/11
2004/02 – 2004/04
2003/09 – 2004/04
2003/01 – 2004/04
2003/12 – 2004/03
2003/06 – 2004/03
2003/03 – 2004/03
2003/03 – 2004/03
2003/06 – 2004/03
2003/03 – 2004/03
2003/09
2003/03 – 2004/03
2003/06
2003/02 – 2003/03
2003/03 – 2004/03
2003/06 – 2003/09
2003/03 – 2004/03
2003/03 – 2004/03
2003/12 – 2004/03
2003/02 – 2004/03
2003/06 – 2004/03
2003/03 – 2004/03
2003/02 – 2003/03
2003/01 – 2004/03
2003/06 – 2003/12
2004/03
2003/09 – 2004/03
2003/02 – 2003/08
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
1,002,720
1,435,650
2,107,995
1,204,378
852,426
2,106,542
301,523
1,956,509
501,766
300,501
2,298,222
804,033
1,707,128
1,484,942
953,957
2,808,019
1,354,571
1,260,974
300,550
2,304,889
450,990
501,100
1,354,178
901,883
2,720
5,650
7,995
4,378
2,426
6,542
1,523
6,509
1,766
501
8,222
4,033
7,128
4,942
3,507
8,019
4,571
5,974
550
4,889
990
1,100
4,178
1,883
April 30, 2004Units : Thousand of NT Dollars
Assets AcquisitionDate (yy/mm)
DispositionDate (yy/mm)
OutstandingAmount
Disposed Price
Profitor Loss Buyer
Relation withthe Company
Lite-On Technology Corporation :
Shinkong Chi-Shin Fund
Dresolner Bond Fund
United Bond Fund
Union Bond Fund
Polaris De-Li Bond Fund
Polaris De-Bao Bond Fund
Lite-On IT Corporation
Innoveta Technologies, Inc.
Silitech Technology Corporation
Lite-On Capital Inc. :
MEGA Diamond Bond Fund
NITC Bond Fund
Increment Securities Investment
Trust Fund
Lite-On IT Corporation :
NITC Bond Fund
Invesco GP R.O.C. Bond Fund
ABN AMRO Bond Fund
Prudential Bond Fund
Union Bond Fund
First Global Investment Trust Duoli-2
Bond Fund
Polaris De-Li Bond Fund
2003/01 – 2004/01
2003/02 – 2004/01
2003/02 – 2004/04
2003/04 – 2004/04
2003/01 – 2004/01
2003/12 – 2004/01
2003/01 – 2004/04
2003/01 – 2003/12
2003/01 – 2004/03
2003/03 – 2004/04
2003/01 – 2004/04
2003/01 – 2003/07
2003/01 – 2004/04
2003/04 – 2004/04
2003/06 – 2004/04
2003/02 – 2004/04
2003/02 – 2004/03
2003/03 – 2004/03
2003/03 – 2004/03
2003/06 – 2004/03
2003/02 – 2004/03
2003/12 – 2004/03
2004/01 – 2004/04
2004/01 – 2004/04
2003/01 – 2004/04
2003/03 – 2004/03
2003/03 – 2003/09
2003/03 – 2004/03
2003/03 – 2004/03
2003/03 – 2004/03
2003/03 – 2003/09
2003/03 – 2004/03
2003/06 – 2004/03
2003/06 – 2004/04
2003/03 – 2004/03
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
TDK
U.S.A.
Corp.
1,704,105
2,105,962
1,083,153
601,554
2,656,166
601,130
2,068,290
380,825
1,674,476
431,999
803,484
1,004,821
1,455,045
1,643,437
1,744,341
874,362
1,165,025
1,163,932
1,113,006
4,105
5,962
3,153
1,554
6,166
1,130
1,557,182
321,068
1,067,563
1,999
3,484
4,821
5,045
3,437
4,341
4,362
5,025
3,932
3,006
April 30, 2004Units : Thousand of NT Dollars
Assets AcquisitionDate (yy/mm)
DispositionDate (yy/mm)
OutstandingAmount
Disposed Price
Profitor Loss Buyer
Relation withthe Company
59 60
Lite-On IT Corporation :
Wanpao Security Investment
Trsut Fund
Sheng Hua 5599 Bond Fund
Grant Cathey Bond Fund
JF First Bond Fund
President James Bond Fund
Fubon Ju-I II Fund
Polaris De-Bao Bond Fund
Solomon Bond Fund
B.B. Bond Fund
ABN AMRO Select Bond Fund
JF Taiwan Bond Fund
Prudential Well Pool Fund
The First Global Investment
Trust Wan Tai Bond Fund
Barits Bond Fund
Dresdner Bond Fund
Cathay Bond Fund
The First Global Investment
Trust Duoli Bond Fund
The IIT High Yield Fund
Sheng Hua 1699 Bond Fund
President Homerun Bond Fund
Fubon Ju-I Bond Fund
Prudential Bond Fund
2003/07 – 2004/04
2003/03 – 2004/04
2003/04 – 2004/04
2003/01 – 2004/04
2003/03 – 2004/04
2003/05 – 2004/04
2003/04 – 2004/04
2003/03 – 2004/04
2003/03 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
2003/01 – 2004/04
2003/03 – 2004/04
2003/03 – 2004/04
2003/04 – 2004/04
2003/04 – 2004/04
2003/04 – 2004/04
2003/01 – 2004/04
2003/04 – 2004/04
2003/09 – 2004/03
2003/03 – 2004/03
2003/06 – 2003/04
2003/03 – 2003/12
2003/03 – 2004/03
2003/06 – 2004/03
2003/06 – 2004/03
2003/03 – 2004/03
2003/03 – 2004/03
2003/03 – 2004/03
2003/06 – 2004/03
2003/03 – 2004/03
2003/03 – 2004/03
2003/03 – 2004/03
2003/03 – 2004/03
2003/03 – 2004/04
2003/03 – 2004/03
2003/06 – 2004/03
2003/06 – 2004/09
2003/06 – 2003/12
2003/03 – 2004/03
2003/06 – 2004/03
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
391,585
833,122
1,454,941
1,163,803
1,204,371
872,548
2,033,696
1,455,413
2,054,679
1,745,266
1,163,089
1,456,446
1,167,334
2,005,383
1,315,028
1,953,378
1,454,557
1,164,906
582,764
874,097
1,214,357
1,164,704
1,585
3,122
4,941
3,803
4,371
2,548
3,696
5,413
4,679
5,266
3,089
6,446
7,334
5,383
5,028
3,378
4,557
4,906
2,764
4,097
4,357
4,704
Lite-On Technology Corporation :
Shinkong Chi-shin Fund
KGI Victory Fund
Capital International Bond Fund
Shinkong Chishun Fund
TIIM Bond Fund
NITC Taiwan Bond Fund
Ta Chong Bond Fund
HSBC NTD Money
Management Fund
Fubon Ju-I 3 Bond Fund
Transcend Fortune Bond Fund
Far Eastern Alliance Taiwan
Bond Fund
UBS Taiwan Bond Fund
UBS Soaring Eagle Bond Fund
The IIT Increment Fund
AIG Taiwan Bond Fund
HSBC NTD Money Management
Fund 2
2003/03 – 2004/04
2003/03 – 2003/04
2003/04 – 2003/07
2003/04 – 2004/04
2003/05 – 2004/04
2003/05 – 2004/04
2003/05 – 2004/04
2003/03 – 2004/04
2003/10 – 2004/04
2003/11 – 2004/04
2003/06 – 2003/10
2003/03 – 2004/04
2003/03 – 2004/04
2003/04 – 2004/04
2004/01 – 2004/04
2004/01 – 2004/04
2003/03 – 2004/04
2003/03 – 2004/06
2003/06 – 2004/08
2003/06 – 2004/03
2003/06 – 2004/03
2003/06 – 2004/03
2003/06 – 2004/03
2003/03 – 2004/03
2003/12 – 2004/03
2003/12 – 2004/03
2003/06 – 2003/12
2003/03 – 2004/03
2003/03 – 2004/04
2003/06 – 2004/03
2004/03 – 2004/04
2004/01 – 2004/03
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
1,744,992
581,874
419,779
1,164,814
1,154,600
973,804
1,163,921
1,261,623
491,823
581,512
591,584
1,452,779
2,324,088
1,124,874
581,278
490,815
4,992
1,874
-221
4,814
4,600
3,804
3,921
1,623
1,823
1,512
1,584
2,779
4,088
4,874
1,278
815
Note: List includes only the assets whose disposition price reaches 20% of the real capital or NTD 300 million.
April 30, 2004Units : Thousand of NT Dollars
Assets AcquisitionDate (yy/mm)
DispositionDate (yy/mm)
OutstandingAmount
Disposed Price
Profitor Loss Buyer
Relation withthe Company
April 30, 2004Units : Thousand of NT Dollars
Assets AcquisitionDate (yy/mm)
DispositionDate (yy/mm)
OutstandingAmount
Disposed Price
Profitor Loss Buyer
Relation withthe Company
Major Assets Disposition:
61 62
F i n a n c i a l I n f o r m a t i o n
63 64
Current Assets 8,744,879 13,353,779 17,390,233 34,501,324 45,884,378 45,369,589
Long-Term Investment 6,864,221 9,980,925 12,400,856 25,239,734 30,223,137 31,794,306
Fixed Assets 936,414 1,099,845 1,237,896 7,387,659 4,022,951 3,982,427
Other Assets 1,713,608 1,757,205 109,143 1,189,078 664,251 862,385
Total Assets 18,259,122 26,191,754 31,291,444 68,418,546 80,794,717 82,008,707
Current 4,717,569 8,892,745 14,066,794 25,926,702 31,469,410 30,657,208
Liabilities 4,743,694 9,308,479 15,256,302 28,886,409 (Note 1) -
Long-Term Liabilities 4,937,976 6,068,913 3,145,181 1,436,994 4,393,002 4,250,000
Other Liabilities 13,297 10,607 38,392 350,924 460,404 717,272
Total 9,668,842 14,972,265 17,250,367 27,549,023 36,322,816 35,624,480
Liabilities 9,694,967 15,387,999 18,439,875 30,508,730 (Note 1) -
Capital Stock 4,934,778 5,741,989 7,488,181 19,094,383 22,476,906 22,476,906
Capital Surplus 3,290,818 3,063,218 3,213,767 17,794,499 15,929,977 15,934,670
Retained 598,554 3,079,516 3,389,762 5,988,417 8,598,465 10,816,622
Earnings 16,193 1,083,991 1,124,032 3,028,710 (Note 1) -
8,590,280 11,219,489 14,041,077 40,869,523 44,471,901 46,384,227
8,564,155 10,803,755 12,851,569 37,909,816 (Note 1) -
Net Sales 14,221,178 25,506,819 27,564,818 48,710,703 99,667,848 33,273,964
Gross Profit 1,324,090 2,471,403 2,327,730 4,149,125 9,518,028 2,743,811
Operating Income (Loss) ( 65,417 ) 511,852 97,862 692,546 2,201,082 1,007,125
Non-Operating Income 1,175,525 3,159,198 334,506 4,371,994 6,879,374 1,753,014
Non-Operating Expenses ( 661,450 ) ( 660,466 ) ( 521,795 ) ( 467,790 ) ( 732,593 ) ( 377,132 )
Net Income (Loss) before Tax 448,658 3,010,584 2,355,283 4,596,750 8,347,863 2,383,007
for Active Operating Departments
Income (Loss) for Active 448,658 3,010,584 2,355,283 5,126,750 7,280,863 2,218,157
Operating Departments
Income (Loss) for Inactive 152,780 11,450 ( 4,951 ) - - -
Operating Departments
Net Income (Loss) 601,438 3,022,034 2,350,332 5,126,750 7,280,863 2,218,157
Earnings (Losses) per Share
(Note 1) 1.22 5.27 3.24 4.91 3.32 1.01
(Note 2) 0.62 3.10 2.44 4.16 - -
01/01/2004 – 03/31/2004(Note 3)1999 2000 2001 2002 2003
5 . Financial Information
1. Financial Historical Summary1.1 Brief Balance Sheet and Income Statement for the Last 5 Years
Balance Sheet Income Statement
CPA’s Opinions for the Last 5 Years.
Year
Items
After Distribution
01/01/2004 – 03/31/2004(Note 2)1999 2000 2001 2002 2003
Year
Items
Financial Data for the Last 5 Years
Unit: Thousand of NT Dollar Unit: Thousand of NT Dollar
Note1: Distribution will be confirmed after being resolved in the 2004 shareholders meeting.
Note2: The balance sheet as of 03/31/2004 has been audited and verified by CPA Chen Chiung Hsiang, Wu Chin Shun of DELOITTE &
TOUCHE on 04/20/2004.
Note 1: Calculated according to weighted averages of the shares in the market.
Note 2: Calculated according to total shares after the increase of capital reserve fund and surplus adjustments.
Note 3: The income statement as of 03/31/2004 has been audited and verified by CPA Chen Chiung Hsiang and Wu Chin Shun of
DELOITTE & TOUCHE on 04/20/2004.
Before Distribution
After Distribution
Before Distribution
After Distribution
Before Distribution
After Distribution
Before DistributionTotal
Stockholders Equity
Financial Data for the Last 5 Years
Year
1999
2000
2001
2002
2003
Names of CPA
Wu Chin Shun, Hsu Shun Hsiung
Wu Chin Shun, Hsu Shun Hsiung
Wu Chin Shun, Hsu Shun Hsiung
Chen Chiung Hsiang, Wu Chin Shun
Chen Chiung Hsiang, Wu Chin Shun
Audit Opinions
Modified Unqualified Opinion
Modified Unqualified Opinion
Modified Unqualified Opinion
Modified Unqualified Opinion
Modified Unqualified Opinion
65 66
52.95
1,444.69
185.37
123.76
2.21
4.24
86
6.23
4.88
59
17.45
0.89
5.19
7.27
( 1.33 )
12.19
3.68
1.22
0.62
(7.95)
(29.77)
(2.71)
(48.70)
0.12
57.16
1,571.89
150.16
108.52
7.40
7.92
46
8.32
7.12
44
23.62
0.99
15.19
30.51
8.91
52.63
11.63
5.27
3.10
31.56
46.65
15.91
3.77
12.95
55.13
1,388.34
123.63
97.25
5.50
7.27
50
7.85
4.65
47
22.27
0.88
9.54
18.61
1.31
31.39
8.53
3.24
2.44
26.22
128
19.53
23.70
(0.23)
40.27
572.66
133.07
109.97
18.14
5.13
71
9.64
3.29
38
6.59
0.71
10.69
18.67
3.63
24.07
10.52
4.91
4.16
0.21
142
2.02
5.95
1.63
44.96
1,214.65
145.81
113.38
55.14
5.52
66
11.63
4.96
31
24.77
1.23
9.91
17.06
9.79
37.14
7.31
3.32
-
10.30
79
1.13
1.53
1.08
43.44
1,275.03
147.99
129.08
48.04
(Note 4)
(Note 4)
(Note 4)
(Note 4)
(Note 4)
(Note 4)
(Note 4)
(Note 4)
(Note 4)
(Note 4)
(Note 4)
6.67
1.01
-
(12.60)
53
(7.06)
1.29
1.05
1.2 Financial Analysis
01/01/2004 – 03/31/2004(Note 3)1999 2000 2001 2002 2003
Year
Analyzed Items
Financial Data for the Last 5 Years
Unit: Thousand of NT Dollar
Note 1: Calculated according to weighted averages of the shares in the market
Note 2: Calculated according to total shares after the increase of capital reserve fund and surplus adjustments.
Note 3: The financial analysis as of 03/31/2004 has been audited and verified by CPA Chen Chiung Hsiang and Wu Chin Shun of
DELOITTE & TOUCHE on 04/20/2004.
Note 4: The only quarter of the fiscal year is not taken into consideration in the financial analysis.
Financial
Structure (%)
Solvency
Operation
Ability
Profitability
Cash Flow
(%)
Leverage
Degree
Debt Ratio
Long-Term Funds to Fixed Assets
Current Ratio (%)
Quick Ratio (%)
Number of Times of Interest Assurance (Times)
Turnover Rate of Receivables (Times)
Number. of Cashing Days of Receivables on Average
Turnover Rate of Inventory (Times)
Turnover Rate of Payable (Times)
Number of Average Sales Days
Turnover Rate of Fixed Assets (Times)
Turnover Rate of Total Assets (Times)
Asset Return Ratio(%)
Return Rate of Shareholders’ Equity
Operating Income to Capital Stock (%)
Income (Loss) before Income Tax to
Capital Stock (%)
Net Profit Ratio (%)Earning (Loss) Per Share (NTD)
(Note 1)
(Note 2)
Cash Flow Ratio
Appropriateness of Cash Flow
Ratio of Cash Reinvestment
Operation Leverage
Financial Leverage
Calculation Methods for Analyzed Items are as below:
i. Financial Structure (%):
(A) Debt Ratio = Total Liabilities / Total Assets.
(B) Long-Term Funds to Fixed Assets = (Net Shareholders' Equity + Long-Term Liabilities) / Net Fixed Assets.
ii. Solvency:
(A) Current Ratio (%) = Current Assets / Current Liabilities
(B) Quick Ratio (%) = (Current Assets - Inventory - Prepaid Expenses) / Current Liabilities.
(C) Number of Times of Interest Assurance (Times) = Net Profit before Income Tax and Interest Expenses / Interest Expenditures this Term
iii. Operation Ability :
(A) Turnover Rate of Receivable (Times) (Including Accounts Receivable and Notes Receivable Incurred By Business) Turnover Rate = Net
Sales / Receivables Averaged in Various Terms (Including Accounts Receivable and Notes Receivable Incurred by Business) Balance.
(B) Number of Cashing Days of Receivables on Average = 365 / Turnover Rate of Receivables.
(C) Turnover Rate of Inventory (Times) = Costs Of Goods Sold / Average Inventory Value.
(D) Turnover Rate Of Payables (Times)(Including Accounts Payable And Notes Payable Incurred By Business) Turnover Rate = Costs of
Goods Sold / Payables Averaged In Various Terms (Including Accounts Payable and Notes Payable Incurred by Business) Balance.
(E) Number of Days In Average Sales = 365 / Turnover Rate Inventory.
(F) Turnover Rate of Fixed Assets (Times) = Net Sales / Net Fixed Assets.
(G) Turnover Rate of Overall Assets (Times) = Net Sales / Total Fixed Assets.
iv. Profitability:
(A) Asset Return Ratio (%)= [ Net Income (Loss) Net Income + Interest Expense (1 - Tax Rate)] / Average Total Assets.
(B) Return Rate Of Shareholders' Equity = Profit (Loss) After Tax / Average Shareholders' Equity, Net
(C) Operating Income (Loss) to Capital Stock (%) = Operating Income (Loss) / Capital Stock.
(D) Income before Income Tax to Capital Stock = Income (Loss) / Capital Stock.
(E) Net Profit Ratio (%) = Income(Loss) / Net Sales
(F) Earning (Loss) per Share = [Net Income (Loss) Dividend of Preferred Shares] / Weighted Average of Outstanding Shares.
v. Cash Flow (%):
(A) Cash Flow Ratio = Net Cash Flow of Operating Activities / Current Liabilities.
(B) Appropriateness of Cash Flow = Net Cash Flow of Operating Activities in the Past Five Years / (Capital Expenditures + Increased
Inventory + Cash Dividend) of The Past Five Years.
(C) Ratio of Cash Reinvestment : (Net Cash Flow of Operating Activities - Cash Dividend) / (Gross Fixed Assets + Long-Term Investment +
Other Assets + Operating Funds).
vi. Leverage Degree:
(A) Operating Leverage = (Net Operating Revenues - Variable Operating Costs and Expenses) / Operating Profits.
(B) Financial Leverage = Operating Profit / (Operating Income Interest Expense)
67 94
The Board of Directors have prepared and submitted to us the Company’s 2003 Business Report, Financial
Statements, and proposal for earnings distribution. The CPAs of DELOITTE & TOUCHE were retained to audit the
Financial Statements and have submitted a report relating thereto. The above Business Report, Financial
Statements and proposal for earnings distribution have been further examined as being correct and accurate by
the undersigned, the supervisors of Lite-On Technology Corporation. According to Article 219 of the Company
Law, we hereby submit this report.
April 28th, 2004
1.3 Supervisor’s Report
Lite-On Technology Corporation
Supervisor: Feng-Ing Soong
Supervisor: Da Song Investment Co., Ltd.
Representative: David Lee
- 1 -
English Translation of a Report Originally Issued in Chinese
INDEPENDENT AUDITORS’ REPORT
February 5, 2004 (Except for the event disclosed in Note 21 on February 11, 2004)
The Board of Directors and Shareholders Lite-On Technology Corporation
We have audited the accompanying balance sheets of Lite-On Technology Corporation as of December 31, 2003 and 2002, and the related statements of income, changes in shareholders’ equity and cash flows for the years then ended. These financial statements are the responsibility of the Corporation’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We did not audit the financial statements as of and for the years ended December 31, 2003 and 2002 of Lite-On Technology (Malaysia) Sdn. Bhd., Lite-On Technology International Inc. (USA), Lite-On Technology (Europe) B.V., Lite-On Electronics (Thailand) Co., Ltd., Lite-On Inc. (USA), Lite-On Electronics (Europe) Ltd., Nport Investment Co., Ltd., Simport Investment Co., Ltd., Litegin Industry Co., Ltd. (Thailand), Innoveta Technologies, Inc., Maxi Switch Inc., Lite-On Peripherals (HK) Ltd., Lite-On Japan Ltd., Lite-On Peripherals Inc. (USA), Lite-On Peripherals Pte. Ltd. (Singapore), Lite-On Peripherals Ireland Inc., GVC Subic Corp., Gentek Marketing Inc., Lite-On Electronics Co., Ltd. (HK), Funbo Enterprises Ltd. (HK), G&W Technology (BVI) Ltd., GVC Corp., Ltd., Lite-On Technology Mexico, S.A. De C.V. We did not audit the financial statements as of and for the year ended December 31, 2003 of Lite-On Technology USA Co., Ltd. We also did not audit the financial statements as of and for the year ended December 31, 2002 of Lite-On Peripherals De Mexico S.A. De C.V., Lite-On Enclosure Inc., Lite-On (USA) International Ltd. and Silitech Technology (Europe) Ltd. All these companies, which are directly or indirectly owned by the Corporation are all accounted for by the equity method. The carrying values of these investments which are included in the accompanying balance sheets, amounted to NT$5,715,899 thousand and NT$5,831,558 thousand, or 7.07% and 8.52% of the Corporation’s total assets as of December 31, 2003 and 2002, respectively. Also, the equity in the net earnings and losses of these investees amounted to NT$387,800 thousand and NT$19,891 thousand, or 4.65% and 0.43% of the Corporation’s income before income tax for the years ended December 31, 2003 and 2002, respectively. The financial statements of these investees were audited by other auditors whose reports have been furnished to us and our opinion, insofar as it relates to the amounts included for these investees mentioned above, is based solely on the reports of other auditors.
68
- 2 -
We conducted our audits in accordance with the Regulations for Audit of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits and the reports of other auditors provide a reasonable basis for our opinion.
In our opinion, based on our audits and the reports of other auditors, the financial statements referred to above present fairly, in all material respects, the financial position of Lite-On Technology Corporation as of December 31, 2003 and 2002, and the results of its operations and its cash flows for the years then ended, in conformity with the Guidelines for Securities Issuers’ Financial Reporting for Public Corporation and accounting principles generally accepted in the Republic of China.
We have also audited the consolidated financial statements of Lite-On Technology Corporation for the years ended December 31, 2003 and 2002 (not presented herein), and have issued a modified unqualified report thereon dated February 5, 2004.
Deloitte & Touche (T N Soong & Co and Deloitte & Touche (Taiwan) Established Deloitte & Touche Effective June 1, 2003) Taipei, Taiwan Republic of China
Notice to Readers
The accompanying financial statements are intended only to present the financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such financial statements are those generally accepted and applied in the Republic of China.
Eng
lish
Tra
nsla
tion
of
Fin
anci
al S
tate
men
ts O
rigi
nally
Iss
ued
in C
hine
se
- 3
-
LIT
E-O
N T
EC
HN
OL
OG
Y C
OR
PO
RA
TIO
N
BA
LA
NC
E S
HE
ET
S D
EC
EM
BE
R 3
1, 2
003
AN
D 2
002
(In
Tho
usan
ds o
f N
ew T
aiw
an D
olla
rs, E
xcep
t P
ar V
alue
)
2003
2002
20
03
2002
A
SSE
TS
Am
ount
%
A
mou
nt
%
LIA
BIL
ITIE
S A
ND
SH
AR
EH
OL
DE
RS’
EQ
UIT
Y
Am
ount
%
Am
ount
%
CU
RR
EN
T A
SSE
TS
C
UR
RE
NT
LIA
BIL
ITIE
S
C
ash
(Not
e 4)
$ 10
,840
,163
13
$ 8,
294,
860
12
Shor
t-te
rm b
ank
loan
s (N
ote
9)
$
1,74
9,86
7
2
$
2,94
1,93
9
4
Not
es r
ecei
vabl
e (N
ote
2)
125,
052
-
14
5,04
1
-
C
omm
erci
al p
aper
(N
ote
10)
-
-
99,7
45
-
Acc
ount
s re
ceiv
able
—ne
t (N
otes
2 a
nd 5
)
13
,990
,176
17
11
,988
,957
18
Not
es p
ayab
le
131,
733
-
2,
043,
762
3R
ecei
vabl
e fr
om r
elat
ed p
artie
s (N
otes
2 a
nd 1
9)
9,54
7,98
6
12
6,
684,
650
10
Acc
ount
s pa
yabl
e
9,54
5,93
8
12
6,68
8,19
9
10
Inve
ntor
ies—
net (
Not
es 2
and
6)
9,80
9,37
9
12
5,
690,
986
8
Paya
ble
to r
elat
ed p
artie
s (N
ote
19)
14,1
94,0
63
18
8,19
4,19
1
12
Def
erre
d in
com
e ta
x as
sets
—cu
rren
t (N
otes
2 a
nd 1
6)
600,
555
1
67
8,00
0
1
In
com
e ta
x pa
yabl
e (N
otes
2 a
nd 1
6)
267,
500
-
33
8,56
2
1
Prep
aid
expe
nses
and
oth
er c
urre
nt a
sset
s
971,
067
1
1,
018,
830
1
Acc
rued
exp
ense
s
2,
445,
554
3
1,
804,
209
3
Cur
rent
por
tion
of lo
ng-t
erm
deb
ts (
Not
e 11
)
89
6,70
2
1
1,61
4,16
7
2
T
otal
cur
rent
ass
ets
45
,884
,378
56
34
,501
,324
50
Prod
uct w
arra
nty
rese
rve
(Not
e 2)
66
2,88
5
1
565,
760
1
Adv
ance
fro
m c
usto
mer
s an
d ot
her
curr
ent l
iabi
litie
s
1,57
5,16
8
2
1,63
6,16
8
2
LO
NG
-TE
RM
IN
VE
STM
EN
TS
(Not
es 2
and
7)
Inve
stm
ents
in s
hare
s of
sto
ck—
equi
ty m
etho
d
27,3
85,9
69
34
22,3
74,3
27
33
Tot
al c
urre
nt li
abili
ties
31
,469
,410
39
25
,926
,702
38In
vest
men
ts in
sha
res
of s
tock
—co
st m
etho
d
2,20
4,54
7
3
2,16
0,32
5
3
Prep
aym
ent
-
-
10
2,46
1
-
L
ON
G-T
ER
M D
EB
TS
(Not
e 11
)
4,
250,
000
5
1,
271,
397
2Fu
nd in
vest
men
ts
632,
621
1
60
2,62
1
1
R
ESE
RV
E F
OR
LA
ND
VA
LU
E I
NC
RE
ME
NT
TA
X (
Not
es 2
and
12)
14
3,00
2
-
165,
597
-
Tot
al lo
ng-t
erm
inve
stm
ents
30
,223
,137
38
25
,239
,734
37
OT
HE
R L
IAB
ILIT
IES
PR
OPE
RT
IES
(Not
es 2
and
8)
D
efer
red
inco
me
tax
liabi
litie
s—no
ncur
rent
(N
otes
2 a
nd 1
6)
232,
591
1
-
-C
ost
D
efer
red
inco
me
(Not
e 2)
57
,521
-
52
,708
-L
and
1,27
8,34
3
2
2,72
2,37
8
4
A
ccru
ed p
ensi
on c
osts
(N
otes
2 a
nd 1
3)
52,3
09
-
44,6
89
-
Bui
ldin
gs
1,55
4,40
7
2
1,61
3,31
0
2
M
isce
llane
ous
(Not
es 2
and
7)
117,
983
-
87
,930
-M
achi
nery
and
equ
ipm
ent
2,
231,
476
3
2,
186,
141
3
M
oldi
ng e
quip
men
t
337,
558
-
11
0,97
5
-
Tot
al o
ther
liab
ilitie
s
46
0,40
4
1
185,
327
-T
rans
port
atio
n eq
uipm
ent
46
,774
-
58,3
36
-
Off
ice
equi
pmen
t
494,
669
1
34
2,46
5
1
Tot
al li
abili
ties
36
,322
,816
45
27
,549
,023
40M
isce
llane
ous
equi
pmen
t
1,10
0,59
7
1
1,10
7,16
8
2
Tot
al c
ost
7,
043,
824
9
8,
140,
773
12
SHA
RE
HO
LD
ER
S’ E
QU
ITY
L
ess:
A
ccum
ulat
ed d
epre
ciat
ion
3,
216,
662
4
2,
722,
601
4
Cap
ital s
tock
—$1
0 pa
r va
lue
3,
827,
162
5
5,
418,
172
8
Aut
hori
zed—
3,50
0,00
0 th
ousa
nd s
hare
s in
200
3 an
d 20
02
Add
: C
onst
ruct
ion
in p
rogr
ess
67,8
57
-
1,
894,
395
3
Issu
ed—
2,24
7,69
1 th
ousa
nd s
hare
s in
200
3 an
d 1,
909,
438
thou
sand
sha
res
Adv
ance
pay
men
ts
127,
932
-
75
,092
-
in
200
2
22,4
76,9
06
28
19,0
94,3
83
28
C
apita
l sur
plus
Net
pro
pert
ies
4,
022,
951
5
7,
387,
659
11
Paid
-in
capi
tal i
n ex
cess
of
par
valu
e
2,74
2,24
8
4
2,74
2,24
8
4
B
ond
conv
ersi
on
2,48
8,89
6
3
2,48
8,89
6
4
PAT
EN
TS
(Not
e 2)
-
-
10
0,75
1
-
T
reas
ury
stoc
k tr
ansa
ctio
ns
273,
063
-
24
5,02
2
-
L
ong-
term
sto
ck in
vest
men
ts u
nder
the
equi
ty m
etho
d
100,
597
-
10
1,61
7
-
OT
HE
R A
SSE
TS
Mer
ger
10,3
25,1
73
13
12,2
16,7
16
18
Def
erre
d ch
arge
s (N
ote
2)
504,
904
1
53
4,25
1
1
T
otal
cap
ital s
urpl
us
15,9
29,9
77
20
17,7
94,4
99
26
Ref
unda
ble
depo
sits
61
,243
-
46,9
98
-
R
etai
ned
earn
ings
L
ease
d as
sets
—ne
t (N
ote
2)
57,6
68
-
58
,694
-
Leg
al r
eser
ve
1,08
3,38
2
2
599,
618
1Id
le a
sset
s—ne
t (N
ote
2)
40,4
05
-
34
,058
-
Una
ppro
pria
ted
earn
ings
7,
515,
083
9
5,
388,
799
8D
efer
red
inco
me
tax
asse
ts—
nonc
urre
nt (
Not
es 2
and
16)
-
-
51
5,04
6
1
T
otal
ret
aine
d ea
rnin
gs
8,59
8,46
5
11
5,98
8,41
7
9
Mis
cella
neou
s
31
-
31
-
Oth
er it
ems
of s
tock
hold
ers’
equ
ity
U
nrea
lized
loss
on
long
-ter
m s
tock
inve
stm
ents
(
41
1,77
5 )
(
1 )
(
515,
073
) (
1
)
Tot
al o
ther
ass
ets
66
4,25
1
1
1,18
9,07
8
2
C
umul
ativ
e tr
ansl
atio
n ad
just
men
ts
(
110,
607
)
-
518,
362
1
Tot
al o
ther
item
s of
sto
ckho
lder
s’ e
quity
(
52
2,38
2 )
(
1 )
3,28
9
-
T
reas
ury
stoc
k—52
,237
thou
sand
sha
res
in 2
003
and
47,5
01 th
ousa
nd s
hare
s
in
200
2 (
2,
011,
065
) (
3
) (
2,
011,
065
) (
3
)
T
otal
sha
reho
lder
s’ e
quity
44
,471
,901
55
40
,869
,523
60
T
OT
AL
ASS
ET
S
$
80,7
94,7
17
1
00
$
68,4
18,5
46
100
T
OT
AL
LIA
BIL
ITIE
S A
ND
SH
AR
EH
OL
DE
RS’
EQ
UIT
Y
$
80,7
94,7
17
100
$
68,4
18,5
46
100
The
acc
ompa
nyin
g no
tes
are
an in
tegr
al p
art o
f th
e fi
nanc
ial s
tate
men
ts.
(See
Del
oitte
& T
ouch
e au
dito
rs’
repo
rt d
ated
Feb
ruar
y 5,
200
4)
69 70
English Translation of Financial Statements Originally Issued in Chinese
- 4 -
LITE-ON TECHNOLOGY CORPORATION
STATEMENTS OF INCOME FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)
2003 2002 Amount % Amount % SALES (Notes 2 and 19) $ 100,915,059 101 $ 49,286,409 101 LESS: SALES RETURNS 868,580 1 429,973 1 SALES ALLOWANCES 378,631 - 145,733 - NET SALES 99,667,848 100 48,710,703 100 COST OF SALES (Notes 17 and 19) 90,165,411 91 44,575,146 91 GROSS PROFIT 9,502,437 9 4,135,557 9 REALIZED PROFITS ON INTERCOMPANY SALES (Note 2) 15,591 - 13,568 - ADJUSTED GROSS PROFIT 9,518,028 9 4,149,125 9 OPERATING EXPENSES (Notes 17 and 19)
Marketing 3,272,986 3 1,801,287 4General and administrative 2,170,493 2 836,646 2Research and development 1,873,467 2 818,646 1
Total operating expenses 7,316,946 7 3,456,579 7 OPERATING INCOME 2,201,082 2 692,546 2 NONOPERATING INCOME
Investment income recognized under the equity method— net (Notes 2 and 7) 3,445,405 3 3,961,957 8Gain on disposal of investments 2,825,987 3 3,275 -Foreign exchange gain—net (Notes 2 and 23) 58,958 - 33,476 -Interest income 19,660 - 75,866 -Dividends income 3,571 - 23,604 -Reversal of loss from decline in inventory value (Note 2) - - 21,730 -Other income 525,793 1 252,086 1
Total nonoperating income 6,879,374 7 4,371,994 9
(Continued)
English Translation of Financial Statements Originally Issued in Chinese
- 5 -
2003 2002 Amount % Amount % NONOPERATING EXPENSES
Interest expense (Notes 8 and 23) $ 154,189 - $ 268,132 1Loss on disposal of inventories 42,585 - 35,380 -Loss from decline in inventory value (Note 2) 29,207 - - -Other expenses (Note 20) 506,612 1 164,278 -
Total nonoperating expenses 732,593 1 467,790 1 INCOME BEFORE INCOME TAX 8,347,863 8 4,596,750 10 INCOME TAX EXPENSE (BENEFIT) (Notes 2 and 16) 1,067,000 1 ( 530,000 ) ( 1 ) NET INCOME $ 7,280,863 7 $ 5,126,750 11
Pre-tax After-tax Pre-tax After-tax EARNINGS PER SHARE (Note 18)
Basic earnings per share $ 3.80 $ 3.32 $ 3.73 $ 4.16
Pro forma information on the assumption that shares of Lite-On Technology Corp. held by its direct and indirect subsidiaries were not treated as treasury stock.
2003 2002 Pre-tax After-tax Pre-tax After-tax NET INCOME $ 8,378,202 $ 7,311,202 $ 4,843,128 $ 5,373,128 EARNINGS PER SHARE
Basic earnings per share $ 3.76 $ 3.28 $ 3.89 $ 4.32
The accompanying notes are an integral part of the financial statements.
(See Deloitte & Touche auditors’ report dated February 5, 2004) (Concluded)
71 72
Eng
lish
Tra
nsla
tion
of
Fin
anci
al S
tate
men
ts O
rigi
nally
Iss
ued
in C
hine
se
- 6
-
LIT
E-O
N T
EC
HN
OL
OG
Y C
OR
PO
RA
TIO
N
STA
TE
ME
NT
S O
F C
HA
NG
ES
IN S
HA
RE
HO
LD
ER
S’ E
QU
ITY
F
OR
TH
E Y
EA
RS
EN
DE
D D
EC
EM
BE
R 3
1, 2
003
AN
D 2
002
(In
Tho
usan
ds o
f N
ew T
aiw
an D
olla
rs)
Cap
ital
Sur
plus
(N
otes
2 a
nd 1
4)
L
ong-
term
Unr
ealiz
ed
st
ock
Los
s on
Pai
d-in
inve
stm
ents
Lon
g-te
rm
Cum
ulat
ive
Tre
asur
y
Cap
ital
Sto
ck
ca
pita
l in
Tre
asur
y G
ain
on
unde
r th
e
Ret
aine
d E
arni
ngs
(Not
es 2
and
14)
Stoc
k
Tra
nsla
tion
St
ock—
T
otal
Shar
es
ex
cess
of
par
Bon
d
stoc
k pr
oper
tyeq
uity
L
egal
Sp
ecia
l U
napp
ropr
iate
d
Inve
stm
ents
Adj
ustm
ents
Cos
t (N
otes
2Sh
areh
olde
rs’
(t
hous
ands
)
Am
ount
valu
e
co
nver
sion
tr
ansa
ctio
ns
disp
osal
met
hod
M
erge
r
T
otal
re
serv
e
rese
rve
earn
ings
Tot
al
(N
ote
2)
(
Not
e 2)
an
d 15
)
E
quit
y
BA
LA
NC
E, J
AN
UA
RY
1, 2
002
748,
818
$
7,48
8,18
1
$ 2,
742,
248
$
195,
261
$
-
$ 26
,743
$
100,
412
$
149,
103
$
3,21
3,76
7
$ 36
1,99
3
$ 35
1,39
6
$ 2
,676
,373
$ 3,
389,
762
( $
198
,985
)
$ 45
7,27
3 (
$ 30
8,92
1 )
$
14,0
41,0
77
T
rans
fer
of s
peci
al r
eser
ve to
una
ppro
pria
ted
earn
ings
-
-
-
-
-
-
-
-
-
- (
35
1,39
6 )
351,
396
-
-
-
-
-T
rans
fer
of p
rior
yea
rs’
net g
ain
from
pro
pert
y di
spos
al to
ret
aine
d
ea
rnin
gs
-
-
-
-
- (
26
,743
)
-
- (
26
,743
)
2,
592
-
24
,151
26
,743
-
-
-
-A
ppro
pria
tion
of p
rior
yea
r’s
earn
ings
Leg
al r
eser
ve
-
-
-
-
-
-
-
-
-
23
5,03
3
-
(
235,
033
)
-
-
-
-
-
Cas
h di
vide
nds—
12.5
%
-
-
-
-
-
-
-
-
-
-
-
( 96
2,93
5 )
(
962,
935
)
-
-
-
(
962,
935
)St
ock
divi
dend
s—12
.5%
96
,293
96
2,93
5
-
-
-
-
-
-
-
-
-
(
962,
935
) (
96
2,93
5 )
-
-
-
-
Bon
us to
em
ploy
ees—
cash
-
-
-
-
-
-
-
-
-
-
-
(
113,
287
) (
11
3,28
7 )
-
-
- (
11
3,28
7 )
Bon
us to
em
ploy
ees—
stoc
k
11,3
29
113,
287
-
-
-
-
-
-
-
-
-
( 11
3,28
7 )
(
113,
287
)
-
-
-
-B
onus
to d
irec
tors
and
sup
ervi
sors
-
-
-
-
-
-
-
-
-
-
-
(
113,
286
) (
11
3,28
6 )
-
-
- (
11
3,28
6 )
Con
vers
ion
of c
onve
rtib
le b
onds
into
com
mon
sto
ck
70,5
65
705,
648
-
2,
293,
635
-
-
-
-
2,29
3,63
5
-
-
-
-
-
-
-
2,99
9,28
3Is
suan
ce o
f sh
ares
for
the
mer
ger
on N
ovem
ber
4, 2
002
(Not
e 1)
1,0
66,5
08
10,6
65,0
85
-
-
-
-
-
12
,067
,613
12,0
67,6
13
-
-
-
-
-
-
-
22,7
32,6
98R
etir
emen
t of
shar
es f
or th
e m
erge
r on
Nov
embe
r 4,
200
2 (
84
,075
) (
84
0,75
3 )
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(
840,
753
)T
reas
ury
stoc
k of
acq
uire
d in
vest
ees
for
tran
sfer
to e
mpl
oyee
s—1,
846
thou
sand
sha
res
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(
53,8
47 )
(
53,8
47 )
Adj
ustm
ent a
risi
ng f
rom
cha
nges
in e
quity
due
to s
ubsi
diar
ies’
retir
emen
t of
trea
sury
sto
ck
-
-
-
-
-
-
(
619
)
-
(
619
)
-
-
( 16
7,77
5 )
(
167,
775
)
-
-
-
(
168,
394
)A
djus
tmen
t ari
sing
fro
m c
hang
es in
equ
ity in
sub
sidi
arie
s di
stri
bute
d
bo
nus
to e
mpl
oyee
s
-
-
-
-
-
-
-
-
-
-
-
( 12
1,15
8 )
(
121,
158
)
-
-
-
(
121,
158
)A
djus
tmen
t ari
sing
fro
m c
hang
es in
equ
ity in
inve
stee
s
-
-
-
-
-
-
1,82
4
-
1,82
4
-
-
-
-
-
-
-
1,82
4N
et in
com
e in
200
2
-
-
-
-
-
-
-
-
-
-
-
5,12
6,75
0
5,
126,
750
-
-
-
5,
126,
750
Unr
ealiz
ed lo
ss o
n lo
ng-t
erm
sto
ck in
vest
men
ts
-
-
-
-
-
-
-
-
-
-
-
-
- (
31
6,08
8 )
-
-
(
316,
088
)C
umul
ativ
e tr
ansl
atio
n ad
just
men
t of
fore
ign-
curr
ency
long
-ter
m s
tock
inve
stm
ents
-
-
-
-
-
-
-
-
-
-
-
-
-
-
61
,089
-
61,0
89C
ash
divi
dend
s re
ceiv
ed b
y su
bsid
iari
es
-
-
-
-
3,48
0
-
-
-
3,48
0
-
-
-
-
-
-
-
3,48
0A
djus
tmen
t of
net g
ain
on d
ispo
sal o
f Pa
rent
Com
pany
’s s
tock
reco
gniz
ed b
y its
sub
sidi
arie
s
-
-
-
-
241,
542
-
-
-
24
1,54
2
-
-
-
-
-
-
-
241,
542
Purc
hase
of
trea
sury
sto
ck—
8,92
5 th
ousa
nd s
hare
s
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(
487,
318
) (
48
7,31
8 )
Rec
lass
ific
atio
n of
long
-ter
m in
vest
men
t to
trea
sury
sto
ck f
or
su
bsid
iari
es h
oldi
ng th
e Pa
rent
Com
pany
’s s
hare
s—29
,605
thou
sand
shar
es
-
-
-
-
-
-
-
-
-
-
-
-
-
-
- (
1,
219,
779
) (
1,
219,
779
)R
eiss
uanc
e of
trea
sury
sto
ck to
em
ploy
ees—
1,67
5 th
ousa
nd s
hare
s
-
-
-
-
-
-
-
-
-
-
-
( 17
5 )
(
175
)
-
-
58
,800
58,6
25
B
AL
AN
CE
, DE
CE
MB
ER
31,
200
2
1,9
09,4
38
19,0
94,3
83
2,74
2,24
8
2,
488,
896
245,
022
-
10
1,61
7
12
,216
,716
17,7
94,4
99
59
9,61
8
-
5,38
8,79
9
5,
988,
417
(
515,
073
)
51
8,36
2 (
2,
011,
065
)
40
,869
,523
App
ropr
iatio
n of
pri
or y
ear’
s ea
rnin
gs
L
egal
res
erve
-
-
-
-
-
-
-
-
-
483,
764
-
( 48
3,76
4 )
-
-
-
-
-C
ash
divi
dend
s—14
%
-
-
-
-
-
-
-
-
-
-
-
( 2,
648,
159
) (
2,
648,
159
)
-
-
-
(
2,64
8,15
9 )
Stoc
k di
vide
nds—
6%
113,
493
1,13
4,92
5
-
-
-
-
-
-
-
-
-
(
1,13
4,92
5 )
(
1,13
4,92
5 )
-
-
-
-
Bon
us to
em
ploy
ees—
cash
-
-
-
-
-
-
-
-
-
-
-
(
89,0
14 )
(
89,0
14 )
-
-
- (
89
,014
)B
onus
to e
mpl
oyee
s—st
ock
35
,606
35
6,05
5
-
-
-
-
-
-
-
-
-
(
356,
055
) (
35
6,05
5 )
-
-
-
-
Bon
us to
dir
ecto
rs a
nd s
uper
viso
rs
-
-
-
-
-
-
-
-
-
-
-
( 22
2,53
4 )
(
222,
534
)
-
-
-
(
222,
534
)C
apita
lizat
ion
of c
apita
l sur
plus
—10
%
189,
154
1,89
1,54
3
-
-
-
-
-
(
1,89
1,54
3 )
(
1,89
1,54
3 )
-
-
-
-
-
-
-
-
Cas
h di
vide
nds
rece
ived
by
subs
idia
ries
-
-
-
-
28
,041
-
-
-
28,0
41
-
-
-
-
-
-
-
28,0
41A
djus
tmen
t ari
sing
fro
m c
hang
es in
equ
ity in
inve
stee
s
-
-
-
-
-
-
-
-
-
-
-
( 1,
285
) (
1,
285
)
-
-
-
(
1,28
5 )
Adj
ustm
ent a
risi
ng f
rom
cha
nges
in e
quity
in s
ubsi
diar
ies
dist
ribu
ted
bonu
s to
em
ploy
ees
-
-
-
-
-
-
-
-
-
-
-
(
207,
580
) (
20
7,58
0 )
-
-
- (
20
7,58
0 )
Adj
ustm
ent a
risi
ng f
rom
cha
nges
in c
apita
l sur
plus
in s
ubsi
diar
ies
-
-
-
-
-
-
(
1,02
0 )
- (
1,
020
)
-
-
( 11
,263
) (
11
,263
)
-
-
-
(
12,2
83 )
Net
inco
me
in 2
003
-
-
-
-
-
-
-
-
-
-
-
7,
280,
863
7,28
0,86
3
-
-
-
7,28
0,86
3R
ever
sal o
f un
real
ized
loss
on
long
-ter
m s
tock
inve
stm
ents
-
-
-
-
-
-
-
-
-
-
-
-
-
103,
298
-
-
103,
298
Cum
ulat
ive
tran
slat
ion
adju
stm
ent o
f fo
reig
n-cu
rren
cy lo
ng-t
erm
sto
ck
in
vest
men
ts
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(
628,
969
)
-
(
628,
969
)
B
AL
AN
CE
, DE
CE
MB
ER
31,
200
3
2,2
47,6
91
$
22,4
76,9
06
$
2,74
2,24
8
$ 2,
488,
896
$
273,
063
$
-
$ 10
0,59
7
$ 10
,325
,173
$
15,9
29,9
77
$ 1,
083,
382
$
-
$ 7
,515
,083
$ 8,
598,
465
( $
411
,775
) (
$ 1
10,6
07 )
( $
2,01
1,06
5 )
$
44,4
71,9
01
The
acc
ompa
nyin
g no
tes
are
an in
tegr
al p
art o
f th
e fi
nanc
ial s
tate
men
ts.
(See
Del
oitte
& T
ouch
e au
dito
rs’
repo
rt d
ated
Feb
ruar
y 5,
200
4)
English Translation of Financial Statements Originally Issued in Chinese
- 7 -
LITE-ON TECHNOLOGY CORPORATION
STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002 (In Thousands of New Taiwan Dollars)
2003 2002
CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 7,280,863 $ 5,126,750Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 692,509 160,718Amortization 361,017 116,066Bad debts 111,061 74,302Loss from decline in inventory value (reversal of loss from decline in inventory value) 29,207 ( 21,730 )Loss on disposal of inventories 42,585 35,380Gain on disposal of investments ( 2,825,987 ) ( 3,275 )Loss on property disposal 12,754 10,724Investment income recognized under the equity method ( 3,445,405 ) ( 3,961,957 )Cash dividends from equity-accounted investees 1,657,840 1,712,610Exchange gain on redemption of foreign convertible bonds - ( 261,237 )Product warranty reserve 97,125 501,630Redemption premium on convertible bonds - ( 1,311,986 )Accrued pension costs 7,620 ( 90,132 )Deferred income taxes 825,082 ( 532,060 )Deferred income 4,813 ( 20,492 )Changes in operating assets and liabilities:
Decrease (increase) in: Notes receivable 19,989 ( 39,094 )Accounts receivable ( 2,112,280 ) ( 993,241 )Receivable from related parties ( 2,861,300 ) ( 896,829 )Inventories ( 4,190,185 ) 1,760,006Prepaid expenses and other current assets 78,415 1,335,183
Increase (decrease) in: Notes payable ( 1,912,029 ) 955,035Accounts payable 2,857,739 ( 2,228,656 )Payable to related parties 5,999,872 ( 564,459 )Income tax payable ( 71,062 ) ( 24,122 )Accrued expenses 641,345 ( 21,383 )Advance from customers and other current liabilities ( 61,000 ) ( 763,941 )
Net cash provided by operating activities 3,240,588 53,810
CASH FLOWS FROM INVESTING ACTIVITIES Decrease in short-term investments 94,020 23,847Proceeds from sale of long-term investments 3,995,086 51,807Acquisition of long-term investments ( 1,508,931 ) ( 127,293 )Acquisition of properties ( 1,121,508 ) ( 597,691 )Proceeds from property disposal 23,332 79,637Decrease (increase) in refundable deposits ( 14,245 ) 21,415
(Continued)
73 74
English Translation of Financial Statements Originally Issued in Chinese
- 8 -
2003 2002
Increase in deferred charges ( $ 174,646 ) ( $ 13,875 )Net cash provided by mergers with Lite-On Electronics, Inc., Silitek Corp., and GVC Corp. - 6,562,631
Net cash provided by investing activities 1,293,108 6,000,478
CASH FLOWS FROM FINANCING ACTIVITIES Repayment of short-term bank loans ( 1,192,072 ) ( 1,016,186 )Repayment of commercial paper ( 99,745 ) ( 1,079,568 )Increase (decrease) in long-term debts 2,261,138 ( 1,871,681 )Increase (decrease) in guarantee deposits 1,993 ( 400 )Cash dividends paid ( 2,648,159 ) ( 962,935 )Bonuses to directors, supervisors and employees ( 311,548 ) ( 226,573 )Purchase of treasury stock - ( 487,318 )Proceeds on treasury stock reissued to employees - 58,625
Net cash used in financing activities ( 1,988,393 ) ( 5,586,036 )
NET INCREASE IN CASH 2,545,303 468,252
CASH, BEGINNING OF YEAR 8,294,860 7,826,608
CASH, END OF YEAR $10,840,163 $ 8,294,860
SUPPLEMENTARY INFORMATION Interest paid (excluding capitalized interests) $ 167,264 $ 194,666Income tax paid $ 312,980 $ 12,330Noncash investing and financing activities
Current portion of long-term debts $ 896,702 $ 1,614,167Conversion of bonds into capital stock and capital surplus $ - $ 2,999,283Reclassification of the parent Corporation’s shares held by direct and indirect subsidiaries as treasury stock $ - $ 1,219,779
Cash paid for acquisition of properties Increase in properties $ 1,136,320 $ 628,139Increase in payable for properties ( 14,812 ) ( 30,448 )
$ 1,121,508 $ 597,691
The accompanying notes are an integral part of the financial statements.
(See Deloitte & Touche auditors’ report dated February 5, 2004) (Concluded)
- 1 -
English Translation of a Report Originally Issued in Chinese
INDEPENDENT AUDITORS’ REPORT
February 5, 2004 (Except for the event disclosed in Note 24 on February 11, 2004)
The Board of Directors and Stockholders Lite-On Technology Corporation
We have audited the accompanying consolidated balance sheets of Lite-On Technology Corporation (“Parent Company”) and subsidiaries as of December 31, 2003 and 2002, and the related consolidated statements of income, changes in shareholders’ equity and cash flows for the years then ended (all expressed in thousands of New Taiwan dollars). These financial statements are the responsibility of the Parent Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We did not audit the financial statements as of and for the year ended December 31, 2003 and 2002 of Lite-On Peripherals (HK) Ltd. and Lite-On Peripherals Pte. Ltd. (Singapore), and the financial statements as of and for the year ended December 31, 2003 of Great Adelphi International Ltd. and Lite-On Technology USA Co., Ltd. (Lite-On International Holding Co., Ltd.’s subsidiary) consolidated subsidiaries. The assets of these subsidiaries amounted to NT$18,438,354 thousand and NT$7,371,527 thousand, or 16.79% and 8.12% of the consolidated assets as of December 31, 2003 and 2002, respectively. Also, the sales of those subsidiaries amounted to NT$31,171,569 thousand and NT$13,381,177 thousand, or 21.54% and 12.83% of the consolidated sales for the years ended December 31, 2003 and 2002, respectively. We did not audit the financial statements as of and for the years ended December 31, 2003 and 2002 of Lite-On Technology (Malaysia) Sdn. Bhd., Lite-On Technology International Inc. (USA), Lite-On Technology (Europe) B.V., Lite-On Electronics (Thailand) Co., Ltd., Lite-On Inc. (USA), Lite-On Electronics (Europe) Ltd., Nport Investment Co., Ltd., Simport Investment Co., Ltd., Litegin Industry Co., Ltd. (Thailand), Innoveta Technologies, Inc., Maxi Switch Inc., Lite-On Japan Ltd., Lite-On Peripherals Inc. (USA), Lite-On Peripherals Ireland Inc., GVC Subic Corp., Gentek Marketing Inc., Lite-On Electronics Co., Ltd. (HK), Funbo Enterprises Ltd. (HK), G&W Technology (BVI) Ltd., GVC Corp., Ltd., Lite-On Technology Mexico, S.A. De C.V. We also did not audit the financial statements as of and for the year ended December 31, 2002 of Lite-On Peripherals De Mexico S.A. De C.V., Lite-On Enclosure Inc., Lite-On (USA) International Ltd. and Silitech Technology (Europe) Ltd. Stock investments in these companies, either directly or indirectly owned by the Corporation, are all accounted for by the equity method. The carrying values of these investments included in the accompanying balance sheets amounted to NT$3,241,072 thousand and NT$4,277,776 thousand, or 2.95% and 4.71% of the Corporation’s total assets as of December 31, 2003 and 2002, respectively. Also, the equity in the net earnings and loss of these investees amounted to NT$104,527 thousand and NT$62,905 thousand, or 1.00% and 0.96% of the Corporation’s income before income tax for the years ended December 31, 2003 and 2002, respectively. The financial statements of the foregoing consolidated subsidiaries and equity-accounted investees were audited by other auditors whose reports have been furnished to us and our opinion, insofar as it relates to the amounts pertaining to the above investees is based solely on the reports of other auditors.
75 76
- 2 -
We conducted our audits in accordance with the Regulations for Audit of Financial Statements by Certified Public Accountants and generally accepted auditing standards in the Republic of China. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits and the reports of other auditors provide a reasonable basis for our opinion.
In our opinion, based on our audits and the reports of other auditors, the financial statements referred to above present fairly, in all material respects, the financial position of Lite-On Technology Corporation and subsidiaries as of December 31, 2003 and 2002 and the results of their operations and their cash flows for the years then ended in conformity with Guidelines for Securities Issuers’ Financial Reporting and generally accepted accounting principles in the Republic of China.
Deloitte & Touche (T N Soong & Co and Deloitte & Touche (Taiwan) Established Deloitte & Touche Effective June 1, 2003) Taipei, Taiwan Republic of China
Notice to Readers
The accompanying financial statements are intended only to present the financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such financial statements are those generally accepted and applied in the Republic of China.
Eng
lish
Tra
nsla
tion
of
Fin
anci
al S
tate
men
ts O
rigi
nally
Iss
ued
in C
hine
se
- 3
-
LIT
E-O
N T
EC
HN
OL
OG
Y C
OR
PO
RA
TIO
N A
ND
SU
BSI
DIA
RIE
S
CO
NSO
LID
AT
ED
BA
LA
NC
E S
HE
ET
S D
EC
EM
BE
R 3
1, 2
003
AN
D 2
002
(In
Tho
usan
ds o
f N
ew T
aiw
an D
olla
rs, E
xcep
t P
ar V
alue
)
200
3
200
2
2
003
200
2 A
SSE
TS
Am
ount
%
A
mou
nt
%
LIA
BIL
ITIE
S A
ND
SH
AR
EH
OL
DE
RS’
EQ
UIT
Y
Am
ount
%
Am
ount
%
CU
RR
EN
T A
SSE
TS
C
UR
RE
NT
LIA
BIL
ITIE
S
C
ash
(Not
e 5)
$ 24
,972
,148
23
$ 21
,711
,495
24
Shor
t-te
rm b
ank
loan
s (N
otes
11
and
22)
$
2,50
9,35
5
2
$
4,16
6,71
6
5
Shor
t-te
rm in
vest
men
ts—
net (
Not
es 2
and
6)
978,
440
1
1,
032,
065
1
Com
mer
cial
pap
er (
Not
e 12
)
-
-
99
,745
-N
otes
rec
eiva
ble
(Not
e 2)
12
5,17
5
-
151,
220
-
Not
es p
ayab
le
131,
762
-
2,
413,
562
3A
ccou
nts
rece
ivab
le—
net (
Not
es 2
and
7)
28,5
85,3
41
26
16,5
09,9
98
18
A
ccou
nts
paya
ble
37
,712
,558
34
23
,079
,950
25R
ecei
vabl
e fr
om r
elat
ed p
artie
s (N
ote
21)
6,19
7,24
2
6
7,40
8,96
2
8
Pa
yabl
e to
rel
ated
par
ties
(Not
e 21
)
2,
919,
424
3
3,
152,
433
3In
vent
orie
s—ne
t (N
otes
2 a
nd 8
)
17
,758
,005
16
12
,070
,452
14
Inco
me
tax
paya
ble
(Not
es 2
and
18)
1,
208,
750
1
48
4,07
0
-
Def
erre
d in
com
e ta
x as
sets
(N
otes
2 a
nd 1
8)
674,
133
1
75
2,02
3
1
A
ccru
ed e
xpen
ses
6,
067,
140
6
5,
303,
365
6Pr
epai
d ex
pens
es a
nd o
ther
cur
rent
ass
ets
1,
586,
527
1
2,
938,
622
3
Cur
rent
por
tion
of lo
ng-t
erm
deb
ts (
Not
es 1
3 an
d 22
)
89
6,70
2
1
1,61
4,16
7
2
Pr
oduc
t war
rant
y re
serv
e (N
ote
2)
961,
848
1
79
7,02
0
1
T
otal
cur
rent
ass
ets
80
,877
,011
74
62
,574
,837
69
Adv
ance
fro
m c
usto
mer
s an
d ot
her
curr
ent l
iabi
litie
s
2,
597,
418
2
2,
584,
681
3
L
ON
G-T
ER
M I
NV
EST
ME
NT
S (N
otes
2 a
nd 9
)
T
otal
cur
rent
liab
iliti
es
55,0
04,9
57
50
43,6
95,7
09
48
Inve
stm
ent i
n sh
ares
of
stoc
k—eq
uity
met
hod
14
,745
,698
13
10
,891
,595
12
In
vest
men
t in
shar
es o
f st
ock—
cost
met
hod
2,
716,
204
3
2,
827,
511
3
LO
NG
-TE
RM
DE
BT
S (N
otes
13
and
22)
4,25
0,00
0
4
1,77
1,07
5
2
Prep
aym
ent
-
-
102,
461
-
Fu
nd in
vest
men
t
715,
050
-
68
5,56
6
1
R
ESE
RV
E F
OR
LA
ND
VA
LU
E I
NC
RE
ME
NT
TA
X (
Not
es 2
and
14)
14
3,00
2
-
165,
597
-
Tot
al lo
ng-t
erm
inve
stm
ents
18
,176
,952
16
14
,507
,133
16
OT
HE
R L
IAB
ILIT
IES
Def
erre
d in
com
e ta
x lia
bilit
ies
(Not
es 2
and
18)
48
6,84
8
1
233,
768
-PR
OPE
RT
IES
(Not
es 2
, 10
and
22)
D
efer
red
inco
me
(Not
e 2)
11
1,97
7
-
52,7
08
-
Cos
t
Acc
rued
pen
sion
cos
ts (
Not
es 2
and
15)
84
,507
-
62
,464
-L
and
1,27
8,34
3
1
2,72
2,37
8
3
G
uara
ntee
dep
osits
11
,376
-
17
,549
-B
uild
ings
4,
489,
197
4
3,
431,
697
4
Mis
cella
neou
s (N
otes
2 a
nd 9
)
11
7,98
3
-
85,9
90
-
Mac
hine
ry a
nd e
quip
men
t
6,09
7,76
4
6
5,53
6,21
0
6
M
inor
ity e
quity
(N
ote
2)
5,16
6,03
3
5
3,79
8,89
8
5
Mol
ding
equ
ipm
ent
47
1,98
0
-
262,
793
1
T
rans
port
atio
n eq
uipm
ent
97
,753
-
109,
372
-
T
otal
oth
er li
abili
ties
5,
978,
724
6
4,
251,
377
5O
ffic
e eq
uipm
ent
98
2,87
0
1
812,
654
1
M
isce
llane
ous
equi
pmen
t
1,94
4,76
4
2
1,95
1,15
9
2
Tot
al li
abili
ties
65
,376
,683
60
49
,883
,758
55T
otal
cos
t
15,3
62,6
71
14
14,8
26,2
63
17
Les
s:
Acc
umul
ated
dep
reci
atio
n
5,86
6,67
8
5
5,33
8,52
8
6
SH
AR
EH
OL
DE
RS’
EQ
UIT
Y
9,49
5,99
3
9
9,48
7,73
5
11
C
apita
l sto
ck—
$10
par
valu
e
Add
: C
onst
ruct
ion
in p
rogr
ess
and
adva
nce
paym
ents
37
5,66
0
-
3,06
2,81
6
3
A
utho
rize
d—3,
500,
000
thou
sand
sha
res
in 2
003
and
2002
Issu
ed—
2,24
7,69
1 th
ousa
nd s
hare
s in
200
3 an
d 1,
909,
438
thou
sand
sha
res
in 2
002
22,4
76,9
06
20
19,0
94,3
83
21
N
et p
rope
rtie
s
9,87
1,65
3
9
12,5
50,5
51
14
C
apita
l sur
plus
Paid
-in
capi
tal i
n ex
cess
of
par
valu
e
2,74
2,24
8
3
2,74
2,24
8
3
INT
AN
GIB
LE
ASS
ET
S
Bon
d co
nver
sion
2,
488,
896
2
2,
488,
896
3Pa
tent
s (N
ote
2)
-
-
100,
751
-
Tre
asur
y st
ock
tran
sact
ions
27
3,06
3
-
245,
022
-L
and
use
righ
t (N
otes
2 a
nd 2
2)
123,
424
-
12
8,77
4
-
L
ong-
term
sto
ck in
vest
men
ts u
nder
the
equi
ty m
etho
d
100,
597
-
10
1,61
7
-
M
erge
r
10
,325
,173
9
12
,216
,716
14
Tot
al in
tang
ible
ass
ets
123,
424
-
22
9,52
5
-
T
otal
cap
ital s
urpl
us
15,9
29,9
77
14
17,7
94,4
99
20
R
etai
ned
earn
ings
O
TH
ER
ASS
ET
S
L
egal
res
erve
1,
083,
382
1
59
9,61
8
-
Def
erre
d ch
arge
s (N
ote
2)
589,
479
1
63
0,96
1
1
U
napp
ropr
iate
d ea
rnin
gs
7,51
5,08
3
7
5,38
8,79
9
6
Ref
unda
ble
depo
sits
72
,820
-
94,0
73
-
T
otal
ret
aine
d ea
rnin
gs
8,59
8,46
5
8
5,98
8,41
7
6
Lea
sed
asse
ts—
net (
Not
e 2)
57
,668
-
58,6
94
-
O
ther
item
s of
sto
ckho
lder
s’ e
quity
Id
le a
sset
s—ne
t (N
otes
2 a
nd 2
2)
40,4
05
-
42
,911
-
Unr
ealiz
ed lo
ss o
n lo
ng-t
erm
sto
ck in
vest
men
ts
(
411,
775)
- (
51
5,07
3) (
1
)M
isce
llane
ous
(Not
e 2)
39
,172
-
64,5
96
-
C
umul
ativ
e tr
ansl
atio
n ad
just
men
ts
(
110,
607)
-
51
8,36
2
1
T
otal
oth
er it
ems
of s
tock
hold
ers’
equ
ity
(
522,
382)
-
3,
289
-
Tot
al o
ther
ass
ets
79
9,54
4
1
891,
235
1
Tre
asur
y st
ock—
52,2
37 th
ousa
nd s
hare
s in
200
3 an
d 47
,501
thou
sand
sha
res
in 2
002
(
2,01
1,06
5) (
2
) (
2,
011,
065)
(
2 )
Tot
al s
hare
hold
ers’
equ
ity
44,4
71,9
01
40
40,8
69,5
23
45
TO
TA
L A
SSE
TS
$ 10
9,84
8,58
4
100
$ 90
,753
,281
1
00
TO
TA
L L
IAB
ILIT
IES
AN
D S
HA
RE
HO
LD
ER
S’ E
QU
ITY
$ 10
9,84
8,58
4
100
$
90,7
53,2
81
100
The
acc
ompa
nyin
g no
tes
are
an in
tegr
al p
art o
f th
e fi
nanc
ial s
tate
men
ts.
(See
Del
oitte
& T
ouch
e au
dito
rs’
repo
rt d
ated
Feb
ruar
y 5,
200
4)
77 78
English Translation of Financial Statements Originally Issued in Chinese
- 4 -
LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)
2003 2002 Amount % Amount % SALES (Notes 2 and 21) $ 147,566,533 102 $ 106,226,636 102 LESS: SALES RETURNS 1,450,938 1 1,757,720 2 SALES ALLOWANCES 1,386,363 1 145,739 - NET SALES 144,729,232 100 104,323,177 100 COST OF SALES (Note 21) 124,178,384 86 88,085,790 85 GROSS PROFIT 20,550,848 14 16,237,387 15 REALIZED (UNREALIZED) PROFITS ON INTERCOMPANY SALES (Note 2) ( 38,865 ) - 13,568 - ADJUSTED GROSS PROFIT 20,511,983 14 16,250,955 15 OPERATING EXPENSES (Note 19)
Marketing 7,779,541 5 6,816,639 6General and administrative 3,477,434 2 1,782,585 2Research and development 2,347,974 2 1,154,802 1
Total operating expenses 13,604,949 9 9,754,026 9 OPERATING INCOME 6,907,034 5 6,496,929 6 NONOPERATING INCOME
Gain on disposal of investments 2,881,621 2 144,410 -Investment income recognized under the equity method—net (Notes 2 and 9) 488,930 1 - -Foreign exchange gain—net (Note 2) 466,413 - 139,087 -Interest income 84,103 - 195,566 -Reversal of loss from decline in inventory value (Note 2) 12,963 - - -Dividends income 8,057 - 44,941 -Other income 409,603 - 492,253 1
Total nonoperating income 4,351,690 3 1,016,257 1
(Continued)
English Translation of Financial Statements Originally Issued in Chinese
- 5 -
2003 2002 Amount % Amount % NONOPERATING EXPENSES
Interest expense (Notes 10 and 26) $ 205,042 - $ 303,389 -Investment loss recognized under the equity method—net (Notes 2 and 9) - - 69,859 -Loss on disposal of inventories 42,585 - 42,812 -Unrealized loss on reduction of short-term investments to market 40,764 - 37,126 -Loss from decline in inventory value (Note 2) - - 117,788 -Other expenses (Note 23) 541,335 1 422,441 1
Total nonoperating expenses 829,726 1 993,415 1 INCOME BEFORE INCOME TAX 10,428,998 7 6,519,771 6 INCOME TAX EXPENSE (BENEFIT) (Notes 2 and 18) 1,784,165 1 ( 600,182 ) ( 1 ) COMPREHENSIVE INCOME 8,644,833 6 7,119,953 7 MINORITY INTEREST INCOME ( 1,363,970 ) ( 1 ) ( 1,890,540 ) ( 2 ) NET INCOME BEFORE ACQUIRING MAJORITY - - ( 102,663 ) - CONSOLIDATED NET INCOME $ 7,280,863 5 $ 5,126,750 5
Pre-tax After-tax Pre-tax After-taxEARNINGS PER SHARE (Note 20)
Basic earnings per share $ 4.13 $ 3.32 $ 3.67 $ 4.16
Pro forma information on the assumption that shares of Lite-On Technology Corp. held by its direct and indirect subsidiaries were not treated as treasury stock (Note 20):
2003 2002 Pre-tax After-tax Pre-tax After-tax
CONSOLIDATED NET INCOME $ 9,095,367 $ 7,311,202 $ 4,772,946 $ 5,373,128 EARNINGS PER SHARE
Basic earnings per share $ 4.08 $ 3.28 $ 3.83 $ 4.32
The accompanying notes are an integral part of the financial statements.
(See Deloitte & Touche auditors’ report dated February 5, 2004) (Concluded)
79 80
Eng
lish
Tra
nsla
tion
of
Fin
anci
al S
tate
men
ts O
rigi
nally
Iss
ued
in C
hine
se
- 6
-
LIT
E-O
N T
EC
HN
OL
OG
Y C
OR
PO
RA
TIO
N A
ND
SU
BSI
DIA
RIE
S
CO
NSO
LID
AT
ED
ST
AT
EM
EN
TS
OF
CH
AN
GE
S IN
SH
AR
EH
OL
DE
RS’
EQ
UIT
Y
FO
R T
HE
YE
AR
S E
ND
ED
DE
CE
MB
ER
31,
200
3 A
ND
200
2 (I
n T
hous
ands
of
New
Tai
wan
Dol
lars
)
Cap
ital
Sur
plus
(N
otes
2 a
nd 1
6)
L
ong-
term
Unr
ealiz
ed
st
ock
Los
s on
Pai
d-in
inve
stm
ents
Lon
g-te
rm
Cum
ulat
ive
Tre
asur
y
Cap
ital
Sto
ck
ca
pita
l in
Tre
asur
y G
ain
on
unde
r th
e
Ret
aine
d E
arni
ngs
(Not
es 2
and
16)
Stoc
k
Tra
nsla
tion
St
ock—
T
otal
Shar
es
ex
cess
of
par
Bon
d
stoc
k pr
oper
tyeq
uity
L
egal
Sp
ecia
l U
napp
ropr
iate
d
Inve
stm
ents
Adj
ustm
ents
Cos
t (N
otes
2Sh
areh
olde
rs’
(t
hous
ands
)
A
mou
nt
v
alue
co
nver
sion
t
rans
acti
ons
di
spos
al
m
etho
d
Mer
ger
Tot
al
rese
rve
r
eser
ve
earn
ings
Tot
al
(N
ote
2)
(
Not
e 2)
an
d 17
)
E
quit
y
BA
LA
NC
E, J
AN
UA
RY
1, 2
002
748,
818
$
7,48
8,18
1
$ 2,
742,
248
$
195,
261
$
-
$ 26
,743
$
100,
412
$
149,
103
$
3,21
3,76
7
$ 36
1,99
3
$ 35
1,39
6
$ 2
,676
,373
$ 3,
389,
762
( $
198
,985
)
$ 45
7,27
3 (
$ 30
8,92
1 )
$
14,0
41,0
77
T
rans
fer
of s
peci
al r
eser
ve to
una
ppro
pria
ted
earn
ings
-
-
-
-
-
-
-
-
-
- (
35
1,39
6 )
351,
396
-
-
-
-
-T
rans
fer
of p
rior
yea
rs’
net g
ain
from
pro
pert
y di
spos
al to
ret
aine
d
ea
rnin
gs
-
-
-
-
- (
26
,743
)
-
- (
26
,743
)
2,
592
-
24
,151
26
,743
-
-
-
-A
ppro
pria
tion
of p
rior
yea
r’s
earn
ings
Leg
al r
eser
ve
-
-
-
-
-
-
-
-
-
23
5,03
3
-
(
235,
033
)
-
-
-
-
-
Cas
h di
vide
nds—
12.5
%
-
-
-
-
-
-
-
-
-
-
-
( 96
2,93
5 )
(
962,
935
)
-
-
-
(
962,
935
)St
ock
divi
dend
s—12
.5%
96
,293
96
2,93
5
-
-
-
-
-
-
-
-
-
(
962,
935
) (
96
2,93
5 )
-
-
-
-
Bon
us to
em
ploy
ees—
cash
-
-
-
-
-
-
-
-
-
-
-
(
113,
287
) (
11
3,28
7 )
-
-
- (
11
3,28
7 )
Bon
us to
em
ploy
ees—
stoc
k
11,3
29
113,
287
-
-
-
-
-
-
-
-
-
( 11
3,28
7 )
(
113,
287
)
-
-
-
-B
onus
to d
irec
tors
and
sup
ervi
sors
-
-
-
-
-
-
-
-
-
-
-
(
113,
286
) (
11
3,28
6 )
-
-
- (
11
3,28
6 )
Con
vers
ion
of c
onve
rtib
le b
onds
into
com
mon
sto
ck
70,5
65
705,
648
-
2,
293,
635
-
-
-
-
2,29
3,63
5
-
-
-
-
-
-
-
2,99
9,28
3Is
suan
ce o
f sh
ares
for
the
mer
ger
on N
ovem
ber
4, 2
002
(Not
e 1)
1,0
66,5
08
10,6
65,0
85
-
-
-
-
-
12
,067
,613
12,0
67,6
13
-
-
-
-
-
-
-
22,7
32,6
98R
etir
emen
t of
shar
es f
or th
e m
erge
r on
Nov
embe
r 4,
200
2 (
84
,075
) (
84
0,75
3 )
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(
840,
753
)T
reas
ury
stoc
k of
acq
uire
d in
vest
ees
for
tran
sfer
to e
mpl
oyee
s—1,
846
th
ousa
nd s
hare
s
-
-
-
-
-
-
-
-
-
-
-
-
-
-
- (
53
,847
) (
53
,847
)A
djus
tmen
t ari
sing
fro
m c
hang
es in
equ
ity d
ue to
sub
sidi
arie
s’
re
tirem
ent o
f tr
easu
ry s
tock
-
-
-
-
-
- (
61
9 )
- (
61
9 )
-
-
(
167,
775
) (
16
7,77
5 )
-
-
- (
16
8,39
4 )
Adj
ustm
ent a
risi
ng f
rom
cha
nges
in e
quity
in s
ubsi
diar
ies
dist
ribu
ted
bonu
s to
em
ploy
ees
-
-
-
-
-
-
-
-
-
-
-
(
121,
158
) (
12
1,15
8 )
-
-
- (
12
1,15
8 )
Adj
ustm
ent a
risi
ng f
rom
cha
nges
in e
quity
in in
vest
ees
-
-
-
-
-
-
1,
824
-
1,
824
-
-
-
-
-
-
-
1,
824
Net
inco
me
in 2
002
-
-
-
-
-
-
-
-
-
-
-
5,
126,
750
5,12
6,75
0
-
-
-
5,12
6,75
0U
nrea
lized
loss
on
long
-ter
m s
tock
inve
stm
ents
-
-
-
-
-
-
-
-
-
-
-
-
-
(
316,
088
)
-
- (
31
6,08
8 )
Cum
ulat
ive
tran
slat
ion
adju
stm
ent o
f fo
reig
n-cu
rren
cy lo
ng-t
erm
sto
ck
in
vest
men
ts
-
-
-
-
-
-
-
-
-
-
-
-
-
-
61,0
89
-
61
,089
Cas
h di
vide
nds
rece
ived
by
subs
idia
ries
-
-
-
-
3,
480
-
-
-
3,
480
-
-
-
-
-
-
-
3,
480
Adj
ustm
ent o
f ne
t gai
n on
dis
posa
l of
Pare
nt C
ompa
ny’s
sto
ck
re
cogn
ized
by
its s
ubsi
diar
ies
-
-
-
-
24
1,54
2
-
-
-
241,
542
-
-
-
-
-
-
-
24
1,54
2Pu
rcha
se o
f tr
easu
ry s
tock
—8,
925
thou
sand
sha
res
-
-
-
-
-
-
-
-
-
-
-
-
-
-
- (
48
7,31
8 )
(
487,
318
)R
ecla
ssif
icat
ion
of lo
ng-t
erm
inve
stm
ent t
o tr
easu
ry s
tock
for
subs
idia
ries
hol
ding
the
Pare
nt C
ompa
ny’s
sha
res—
29,6
05 th
ousa
nd
sh
ares
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(
1,21
9,77
9 )
(
1,21
9,77
9 )
Rei
ssua
nce
of tr
easu
ry s
tock
to e
mpl
oyee
s—1,
675
thou
sand
sha
res
-
-
-
-
-
-
-
-
-
-
-
(
175
) (
17
5 )
-
-
58,8
00
58
,625
BA
LA
NC
E, D
EC
EM
BE
R 3
1, 2
002
1
,909
,438
19
,094
,383
2,
742,
248
2,48
8,89
6
24
5,02
2
-
101,
617
12,2
16,7
16
17
,794
,499
599,
618
-
5,
388,
799
5,98
8,41
7 (
51
5,07
3 )
518,
362
(
2,01
1,06
5 )
40,8
69,5
23
A
ppro
pria
tion
of p
rior
yea
r’s
earn
ings
Leg
al r
eser
ve
-
-
-
-
-
-
-
-
-
48
3,76
4
-
(
483,
764
)
-
-
-
-
-
Cas
h di
vide
nds—
14%
-
-
-
-
-
-
-
-
-
-
-
(
2,64
8,15
9 )
(
2,64
8,15
9 )
-
-
- (
2,
648,
159
)St
ock
divi
dend
s—6%
11
3,49
3
1,
134,
925
-
-
-
-
-
-
-
-
-
( 1,
134,
925
) (
1,
134,
925
)
-
-
-
-B
onus
to e
mpl
oyee
s—ca
sh
-
-
-
-
-
-
-
-
-
-
-
( 89
,014
) (
89
,014
)
-
-
-
(
89,0
14 )
Bon
us to
em
ploy
ees—
stoc
k
35,6
06
356,
055
-
-
-
-
-
-
-
-
-
( 35
6,05
5 )
(
356,
055
)
-
-
-
-B
onus
to d
irec
tors
and
sup
ervi
sors
-
-
-
-
-
-
-
-
-
-
-
(
222,
534
) (
22
2,53
4 )
-
-
- (
22
2,53
4 )
Cap
italiz
atio
n of
cap
ital s
urpl
us—
10%
18
9,15
4
1,
891,
543
-
-
-
-
- (
1,
891,
543
) (
1,
891,
543
)
-
-
-
-
-
-
-
-C
ash
divi
dend
s re
ceiv
ed b
y su
bsid
iari
es
-
-
-
-
28,0
41
-
-
-
28
,041
-
-
-
-
-
-
-
28
,041
Adj
ustm
ent a
risi
ng f
rom
cha
nges
in e
quity
in in
vest
ees
-
-
-
-
-
-
-
-
-
-
-
(
1,28
5 )
(
1,28
5 )
-
-
- (
1,
285
)A
djus
tmen
t ari
sing
fro
m c
hang
es in
equ
ity in
sub
sidi
arie
s di
stri
bute
d
bo
nus
to e
mpl
oyee
s
-
-
-
-
-
-
-
-
-
-
-
( 20
7,58
0 )
(
207,
580
)
-
-
-
(
207,
580
)A
djus
tmen
t for
cap
ital s
urpl
us f
rom
long
-ter
m s
tock
inve
stm
ents
acco
unte
d fo
r by
the
equi
ty m
etho
d
-
-
-
-
-
-
(
1,02
0 )
- (
1,
020
)
-
-
( 11
,263
) (
11
,263
)
-
-
-
(
12,2
83 )
Net
inco
me
in 2
003
-
-
-
-
-
-
-
-
-
-
-
7,
280,
863
7,28
0,86
3
-
-
-
7,28
0,86
3R
ever
sal o
f un
real
ized
loss
on
long
-ter
m s
tock
inve
stm
ents
-
-
-
-
-
-
-
-
-
-
-
-
-
103,
298
-
-
103,
298
Cum
ulat
ive
tran
slat
ion
adju
stm
ent o
f fo
reig
n-cu
rren
cy lo
ng-t
erm
sto
ck
in
vest
men
ts
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(
628,
969
)
-
(
628,
969
)
B
AL
AN
CE
, DE
CE
MB
ER
31,
200
3
2,2
47,6
91
$
22,4
76,9
06
$
2,74
2,24
8
$ 2,
488,
896
$
273,
063
$
-
$ 10
0,59
7
$ 10
,325
,173
$
15,9
29,9
77
$ 1,
083,
382
$
-
$ 7
,515
,083
$ 8,
598,
465
( $
411
,775
) (
$ 1
10,6
07 )
( $
2,01
1,06
5 )
$
44,4
71,9
01
The
acc
ompa
nyin
g no
tes
are
an in
tegr
al p
art o
f th
e fi
nanc
ial s
tate
men
ts.
(See
Del
oitte
& T
ouch
e au
dito
rs’
repo
rt d
ated
Feb
ruar
y 5,
200
4)
English Translation of Financial Statements Originally Issued in Chinese
- 7 -
LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002 (In Thousands of New Taiwan Dollars)
2003 2002 CASH FLOWS FROM OPERATING ACTIVITIES
Consolidated net income $ 7,280,863 $ 5,126,750Adjustments to reconcile consolidated net income to net cash provided by operating activities:
Minority interest income 1,363,970 1,890,540Net income before acquiring majority - 102,663 8,644,833 7,119,953Depreciation 1,546,010 1,002,331Amortization 540,483 175,887Bad debts 78,148 84,486Unrealized loss on reduction of short-term investments to market 40,764 37,126Loss from decline in inventory value (reversal of loss from decline in inventory value) ( 12,963 ) 117,788Gain on disposal of investments ( 2,881,621 ) ( 144,410 )Net loss on property disposal 29,650 16,409Investment loss (income) recognized under the equity method ( 488,930 ) 69,859Cash dividends from equity-accounted investees 328,356 621,410Exchange gain on redemption of foreign convertible bonds - ( 261,237 )Product warranty reserve 164,828 368,779Redemption premium on convertible bonds - ( 1,311,986 )Accrued pension costs 22,043 ( 83,367 )Deferred income taxes 330,970 ( 883,863 )Deferred income 59,269 ( 20,492 )Changes in operating assets and liabilities:
Decrease (increase) in: Notes receivable 26,045 ( 41,798 )Accounts receivable ( 12,153,491 ) ( 2,028,060 )Receivable from related parties 1,213,756 ( 3,711,122 )Inventories ( 5,674,590 ) 814,107Prepaid expenses and other current assets 1,382,747 130,040
Increase (decrease) in: Notes payable ( 2,281,800 ) 1,324,541Accounts payable 14,632,608 2,821,159Payable to related parties ( 233,009 ) ( 1,549,998 )Income tax payable 724,680 ( 131,727 )Accrued expenses 763,775 1,433,035Advance from customers and other current liabilities 12,737 ( 58,016 )
Net cash provided by operating activities 6,815,298 5,910,834 CASH FLOWS FROM INVESTING ACTIVITIES
Decrease (increase) in short-term investments 162,515 ( 311,721 )Proceeds from sale of long-term investments 4,005,304 51,807Acquisition of long-term investments ( 997,822 ) ( 43,242 )Acquisition of properties ( 3,514,023 ) ( 1,050,603 )
(Continued)
81 82
84
Lite-On Technology Corporation
Raymond Soong, Chairman
This annual report contains excerpts from the Chinese version of Lite-On Technology
Corporation's 2003 annual report, which was printed on April 30th, 2004 and
published in accordance with "the Regulations of the Criteria Governing Information
to be published in Annual Company Reports in the Republic of China." For more
information, please refer to the Chinese version of the Company's annual report.
English Translation of Financial Statements Originally Issued in Chinese
- 8 -
2003 2002
Proceeds from property disposal $ 833,237 $ 77,263Decrease (increase) in refundable deposits 21,253 ( 5,490 )Increase in deferred charges ( 335,630 ) ( 21,910 )Increase in land use right - ( 48,257 )Net cash provided by mergers with Lite-On Electronics, Inc., Silitek Corp., and GVC Corp. - 6,562,631
Net cash provided by investing activities 174,834 5,210,478 CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term bank loans ( 1,657,361 ) 208,591Repayment of commercial paper ( 99,745 ) ( 1,079,568 )Increase (decrease) in bonds payable 1,761,460 ( 1,537,600 )Decrease in guarantee deposits ( 6,173 ) ( 16,428 )Decrease in minority equity - ( 249,423 )Payment on treasury stock - ( 382,887 )Cash dividends paid ( 3,222,080 ) ( 962,935 )Bonuses to directors, supervisors and employees ( 311,548 ) ( 226,573 )Proceeds on treasury stock reissued to employees - 58,625
Net cash used in financing activities ( 3,535,447 ) ( 4,188,198 ) TRANSLATION ADJUSTMENTS ( 194,032 ) 97,613 NET INCREASE IN CASH 3,260,653 7,030,727 CASH, BEGINNING OF YEAR 21,711,495 14,680,768 CASH, END OF YEAR $ 24,972,148 $ 21,711,495 SUPPLEMENTARY INFORMATION
Interest paid (excluding capitalized interests) $ 217,242 $ 269,015Income tax paid $ 708,729 $ 401,612Noncash investing and financing activities
Current portion of long-term debts $ 896,702 $ 1,614,167Conversion of bonds into capital stock and capital surplus $ - $ 2,999,283Reclassification of the Parent Company’s shares held by direct and indirect subsidiaries as treasury stock $ - $ 1,219,779
Cash paid for acquisition of properties Total acquisition $ 3,583,649 $ 1,092,708Increase in payable for properties ( 69,626 ) ( 42,105 )
$ 3,514,023 $ 1,050,603
The accompanying notes are an integral part of the financial statements.
(See Deloitte & Touche auditors’ report dated February 5, 2004) (Concluded)
83