Formosan Union Chemical Corp. - Investor Conference Insights

FUCC Formosan Union Chemical Corp. 2022 Investor Conference 12.15.2022 (Stock Symbol: 1709)

Information in this presentation may include forward-looking statements; however, it is not limited to statements on all of our possible business activities, events or developments. Such statements are based on our assumptions on future operation, political, economic and market factors not in our control. Actual operational outcomes may be significantly different from such statements.

Company Historical Highlights June 1973 Established in Taipei City on June 21, 1973. The registered capital is NT$50,000,000. Completed Linyuan Factory in Kaohsiung. Started producing detergent-use alkyl benzenes. Initial Public Offering of Company Stocks. Nonylphenol plant expansion, annual production capacity increased to 25KT. Upgrade alkylation equipments. Increased the total capacity of alkyl benzenes to 125KT. Jan. 2014 Granted the permission to release the first domestic unsecured convertible debenture. The total amount is NT$ 0.7 billion. The debenture has been listed since February 20th in the year. May 2016 Completed plant debottleneck of Hydrogenated Hydrocarbon Resin, annual production capacity increased to 24KT. April 2018 Started-up 40KTA Nonylphenol Plant in Jiangsu, China. The plant is 50-50 JV with Chang Chun Group. April 1977 July 1986 Oct. 2004 Dec. 2010

Business Scope Main business: We're committed to the manufacturing and sale of alkyl benzene, alkyl phenol, and hydrocarbon resin and their derivatives. We also manage the operation and investment of related businesses.

Business Proportion for Main Products (Departments) Our main business focuses on the manufacturing and sale of the products and derivatives below: Alkyl benzene, alkyl phenol, alkyl benzene sulfonic acid and hydrocarbon resin. Year 2021 2020 Item Amount 6,784,084 1,873,712 541,358 9,199,154 Ratio (%) 73.75 6,006,316 20.37 1,748,954 5.88 100.00 8,481,829 Amount Ratio (%) 70.81 20.62 8.57 100.00 Alkylation Department Resin Department 726,559 Agriculture & Others Total Unit: NT$ thousand

Our Products 1. Alkyl benzene: An upstream material for household laundry powder and detergent. 2. Alkyl benzene sulfonic acid: Alkyl benzene sulfonic acid is the main component of the decontaminant. It is extensively used in the household cleaning and personal care field, including laundry powder, detergent, home cleaners and cosmetics. 3. Alkyl phenol: An upstream material for surfactant and raw material for lubricant additives. It's mainly used in the industrial detergent, antioxidant, coatings, high-class printing ink resin, hardener and lubricants. 4. C9 hydrocarbon resin/hydrogenated hydrocarbon resin: It's the upstream material for adhesive and hot melt adhesive. It increases the tack of adhesives. 5. Other: We also focus on the sale of agro-product and refined sugar.

Market Analysis Primary sales region of product Unit: NT$ thousand Year 2021 2020 Sales Region Amount 1,020,038 896,781 338,670 561,913 1,155,197 2,205,022 6,177,621 Ratio (%) Amount 2,206,972 1,268,727 566,044 557,011 904,514 2,978,561 8,481,829 Ratio (%) 16.51 14.52 5.48 9.10 18.70 35.69 100.00 26.02 14.96 6.67 6.57 10.66 35.12 100.00 Domestic sales China Vietnam Philippines Guatemala Export sales Subtotal for others Net sales

Short and Long Term Business Development Plans Alkyl benzene 1. Short term: We aim to strengthen customer service and consolidate our market. 2. Long term: We strive to offer customers personal and specialized services and develop new uses of products. Alkylphenol 1. Short term: We continue to develop the European and U.S. markets to increase the global market share. 2. Long term: We will maintain stable high operating rate. Develop other alkylphenol products such as the lubricant additives to increase the operating profit. Hydrogenated hydrocarbon resin 1. Short term: We provide a complete product line for hydrogenated and non-hydrogenated C9 hydrocarbon resin. We develop a highly hydrogenated hydrocarbon resin with high softening point to meet customers needs. 2. Long term: We will continue to expand the capacity and increase the production efficiency.

Financial Overview Financial information for the last 5 years

CONSOLIDATED STATEMENTS OF INCOME IN THE LAST 5 YEARS Unit: NT$ million 2018 9,785 8,533 1,252 759 493 % 100 87 13 2019 8,797 7,800 997 693 304 % 100 89 11 2020 8,482 100 6,992 1,490 781 709 % 2021 9,199 7,060 2,139 920 1,219 % 100 77 23 10 13 2022Q3 % 8,084 100 6,439 1,645 719 926 Operating revenue 82 18 80 20 Operating costs Gross profit 8 5 8 3 9 9 9 Operating expenses 11 Profit from operations Non-operating income and expenses 30 - (6) - 5 - (209) (2) 264 4 523 5 298 3 714 9 1,010 11 1,190 15 Profit before income tax 133 1 90 1 174 2 91 1 250 3 Income tax expense 390 4 208 2 540 7 919 10 940 12 Net profit 0.77 0.44 1.16 1.99 1.97 Earnings per share (NT$) 0.50 0.50 1.20 1.70 - Cash dividends (NT$)

CONSOLIDATED REVENUE IN THE LAST 5 YEARS Unit: NT$ million 12,000 9,785 10,000 9,199 8,797 8,482 8,084 8,000 6,000 Operating Revenue 4,000 2,000 0 2018 2019 2020 2021 2022Q3

NET PROFIT (After Tax) IN THE LAST 5 YEARS Unit: NT$ million 1000 940 919 900 800 700 600 540 500 390 400 Net Profit After Tax 300 208 200 100 0 2018 2019 2020 2021 2022Q3

SIMPLIFIED CONSOLIDATED STATEMENTS OF INCOME Amount of increase (or decrease) Rate of increase (or decrease) (% Unit: NT$ million 2022Q3 % 2021Q3 % 8,084 100 7,020 100 1,064 15 Operating revenue 6,439 80 5,333 76 1,106 21 Operating costs 1,645 20 1,687 24 (42) (2) Gross profit 719 9 701 10 18 3 Operating expenses 926 11 986 14 (60) (6) Profit from operations 264 4 50 1 214 428 Non-operating income and expenses 1,190 15 1,036 15 154 15 Profit before income tax 250 3 218 3 32 15 Income tax expense 940 12 818 12 122 15 Net profit for the period

FINANCIAL RATIO ANALYSIS IN THE LAST 5 YEARS 18 15.73 16 14 11.95 12 10.26 10 8.25 ROA ROE 7.32 8 6 5.1 5.01 3.7 4 2.82 2.04 2 0 2018 2019 2020 2021 2022Q3

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