CAL — Investor Presentation 2020

Dec 1, 2020

• The information contained in this presentation, Legal including all forward-looking information, is China Airlines subject to change without notice, whether as a Disclaimer result of new further events or 2020 Investor Conferenceinformation, otherwise, and China Airlines(the “Company”) undertakes no to or obligation publicly update revise the information contained in this presentation.

December 1, 2020

TSE：2610

• No guarantees regarding the completeness, accuracy, and reliability of information contained are made explicitly or implicitly. They are not intended to represent complete statement of the Company,industryorfuturedevelopment.

1. First Three Quarters Financial Results for 2020

• 1) Operating Performance 2) Composition of Op. Revenue & Cost 3) Financial Risk Management

2. Impact of COVID-19 Pandemic

• 1) Industry Environment Update 2) Operational Performance Update 3) Response to COVID-19

3. Post-COVID-19 Outlook

First Three Quarters Financial Results for

2020

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3

O eratin Performance –2020Q3 p g

Operating Performance –2020Q3	Operating Performance –2020Q3	Operating Performance –2020Q3	Operating Performance –2020Q3
Consolidated Financial Statistics TWD 100 Million
	2019Q3	2020Q3	YoY %
Operating Revenue	430.05	266.12	-38.12%
Net Operating Income(Loss)	14.62	-3.57	-
Net Income(Loss) After Tax	4.96	-8.17	-
Net Income(Loss) Attributable to Owners ofthe company	3.40	-7.08	-
Earnings(Loss) Per Share (TWD)	0.06	-0.13	-

Group Revenue TWD 100 Million	Group Revenue TWD 100 Million	Group Revenue TWD 100 Million	Group Revenue TWD 100 Million
	2019Q3	2020Q3	YoY %
Passenger Revenue	290.96	32.41	-88.86%
Cargo Revenue	106.82	215.09	101.36%
Other Operating Revenue	32.27	18.62	-42.3%
Total Group Operating Revenue	430.05	266.12	-38.12%

O eratin Performance –2020Q1-Q3 p g

Operating Performance –2020Q1-Q3	Operating Performance –2020Q1-Q3	Operating Performance –2020Q1-Q3	Operating Performance –2020Q1-Q3
Consolidated Financial Statistics TWD 100 Million
	2019Q1-Q3	2020Q1-Q3	YoY %
Operating Revenue	1,263.02	854.84	-32.32%
Net Operating Income(Loss)	27.96	-5.8	-
Net Income (Loss) After Tax	0.58	-23.75	-
Net Loss Attributable to Owners ofthe company	-3.46	-20.22	-
Loss Per Share (TWD)	-0.06	-0.37	-

Group Revenue TWD 100 Million	Group Revenue TWD 100 Million	Group Revenue TWD 100 Million	Group Revenue TWD 100 Million
	2019Q1-Q3	2020Q1-Q3	YoY %
Passenger Revenue	845.52	234.83	-72.23%
Cargo Revenue	318	560.46	76.25%
Other Operating Revenue	99.5	59.55	-40.15%
Total Group Operating Revenue	1,263.02	854.84	-32.32%

Composition of Op. Revenue -CI

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4%
2020 Passenger
Revenue Cargo Revenue 72%
Q1-Q3
24%
2019
Passenger Revenue 67% Cargo Revenue 29%
Q1-Q3
4%
Passenger, Cargo and other operating revenue accounted for 24%, 72%
and 4% respectively in the first three quarters of 2020.
Other Op. Rev.
Other Op. Rev.
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Composition of Op. Expenses -CI

2020 Q1-Q3

2019 Q1-Q3

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1.9% 1.6%
Airport & Ground Rental &
Fuel
Handling Personnel Depreciation Maitenance
21.9% 12.1% 16.5% 23.0% 19.4% 3.5%
3.6%
Airport & Ground Rental &
Fuel
Handling Personnel Depreciation Maitenance
30.7% 13.7% 13.6% 16.6% 13.3%
3.7%
4.4% 4.0%
Others
Pax Service
Sales&General Adm.
Others
Pax Service
Sales&General Adm.
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Fuel cost accounted for 21.9% of operating expenses due to COVID-19 pandemic in the first three quarters of 2020.

Financial Risk Management –Fuel (CI)

Financial Risk Management –Fuel (CI)	Financial Risk Management –Fuel (CI)	Financial Risk Management –Fuel (CI)	Financial Risk Management –Fuel (CI)	Financial Risk Management –Fuel (CI)
Fuel Cost
		2019Q1-Q3	2020Q1-Q3	YoY%
Jet Fuel (MOPS)	USD/BBL	77.69	44.04	-43.3%
Fuel Consumption	10KBBL	1,300.39	1,026.71	-21%
Fuel Expend	TWD/100Million	333.14	166.23	-50.1%
Hedging Loss	TWD/100Million	0.14	0.34	142.9%
Total Fuel Cost	TWD/100Million	333.28	166.57	-50%

Fuel Hedging

	Fuel Hedging
	Year	Hedging%
	2020.12-2021.11	0.16%

Impact of COVID-19 Pandemic Industry Environment Update

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9

Air Travel Recovery Slower Than Expected

IATA forecast global passenger traffic will not return to pre-COVID-19 levels until 2024 and full-year 2020 traffic to be down 66% compared to 2019.

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Previous Forecast -63%
Latest Forecast -66%
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IMF Upgraded 2020 Economic Forecast

The global economy is projected to contract by 4.4% in 2020 — an upward revision from an estimate of -4.9% made in June due to the better-than-expected growth in advanced economies and Mainland China.

Major Economies 2020→2021 Economic Growth Rate

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Euro Zone
Mainland China Japan
-10.2% →6.0%
America 1.0% →8.2% -5.8% →2.4%
-8.3% →5.2%
-8.0% →4.5% 1.9% →8.2% -5.3% →2.3%
-4.3% → 3.1%
Taiwan
India
-4.0% → 3.5%
-4.5% →6.0%
0.0% → 3.2%
-10.3% →8.8%
Brazil
-9.1% → 3.6%
-5.8% → 2.8%
Forecast in June
Forecast in October
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11

Impact of COVID-19 Pandemic Operational Performance Update

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Passenger Performance

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Revenue Composition by Region
Australia/
TWD 78.82 Billion New
Trans Pacific Zealand
Ocean 9%
21% Europe
12%
▼ 73.8%
Hong Kong
4%
South East
TWD 19.07 Billion Asia
21% North East
Asia
Mainland 25%
China
2019 Q1-Q3 2020 Q1-Q3 8%
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• Passenger revenue decreased by 73.8% to TWD 19.07 billion in the first three quarters of 2020.

• Northeast Asia accounted for the largest share (25%) of revenue, followed by Trans Pacific Ocean and South East Asia with revenue share of 21% respectively.

Passenger Operation Index

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ASK (MN) Load Factor Yield (TWD)
2.47
39,255
80.7% 2.30
▲7.4%
▼68.0% ▼19.3ppt 61.4%
12,569
2019Q1-Q3 2020Q1-Q3 2019Q1-Q3 2020Q1-Q3 2019Q1-Q3 2020Q1-Q3
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ASK and load factor decreased by 68.0% and 19.3ppt respectively while yield increased by 7.4% in the first three quarters of 2020.

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Impact on Passenger Traffic
5,000
4%
0%
4,000
-23%
3,240
3,128 3,253 3,229 3,271 3,194 3,331 3,315 3,157
2,984
3,000
-40%
2,309
-65%
2,000
-80%
1,150
-97% -98% -97% -95% -94% -93%
1,000
156 187 232
89 53 86
- -120%
Round Trips Jan Feb Mar Apr May Jun Jul Aug Sep
2019 2020 YoY%
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• CAL provided a minimum passengers-carried schedule to meet market demand.

• Our frequencies between April and June plunged more than 97% compared to the same period last year; however there is slowly recovering with essential travelling in the third quarter.

Passenger Impact-Skeletal Network

Region	Route Adjustments
North America	Los Angeles/San Francisco 3 Flights/wk, Vancouver 2 Flights/wk, New York 2 Flights/mth
Europe	Amsterdam 2 Flights/wk, Frankfurt/ London 1 Flight/wk
Oceania	Sydney 1 Flight/wk, Melbourne/ Brisbane 2 Flights/mth, Auckland 1 Flight/mth
Northeast Asia	Tokyo 3 Flights/wk, Seoul 2 Flights/wk, Osaka/ Fukuoka/ Nagoya 1 Flight/wk
	Jakarta 1 Flight/day, Manila 4~5 Flights/wk, Phnom Penh 2 Flights/wk,
Southeast Asia	Vietnam 11~12 Flights/wk, Bangkok 3~4 Flights/wk, Singapore/ Kuala
	Lumpur 2 Flights/wk,Penang/Yangon 1~2 Flights/wk
Mainland China	Shanghai 9 Flights/wk, Xiamen 3 Flights/wk,Chengdu 2 Flights/wk,Beijing
(KHH departures included)	1 Flight/wk
Hong Kong (KHH departures included)	10 Flights/wk

Cargo Performance

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Revenue Composition by Region
Australia/
New Zealand
TWD 55.89 Billion Europe 3%
9% Hong
Kong
North East 4%
▲77.4% Asia
5%
TWD 31.05 Billion
Mainland
China
Trans Pacific 6%
Ocean
58% South East
Asia
15%
2019Q1-Q3 2020Q1-Q3
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• Cargo revenue totaled TWD 55.89 billion, a 77.4% increase, in the first three quarters of 2020.

• Trans Pacific Ocean accounted for the largest share(58%) of revenue, followed by Southeast Asia and Europe with revenue share of 15% and 9% respectively.

Cargo Performance Index

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FATK (MN) Load Factor Yield (TWD)
6,286 12.44
5,860
▲ 7.3% 71.5%
66.3%
▲ 5.2ppt ▲53.4%
8.11
2019 Q1-Q3 2020Q1-Q3 2019Q1-Q3 2020Q1-Q3 2019Q1-Q3 2020Q1-Q3
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FATK increased by 7.3% and load factor grew 5.2 ppt with a 53.4% rise in yield in the first three quarters of 2020.

Response to COVID-19 - Passenger - Cargo

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19

Flight Schedule Adjusted in Line with Market Demand

Operations remain active in adapting to the dynamic changes of the market landscape and governments regulations.

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Operate selected routes to maintain network connectivity, taking . advantage of sixth traffic rights Gradually resume flights to align with boarder reopening, regional business travel needs and travel bubble. Increase Taiwan domestic air travel market via CAL Group’s subsidiaries . Operate charter flights to generate revenue.

Resuming Operation with Safety Procedures

CAL was also rated as the top safest airlines to fly during COVID-19 by Safe Travel Barometer in August, having implemented numerous pro-traveler health and safety initiatives.

Cabin Crew Protective Equipment PA Announcement Inflight Supplies Inflight Meal Fresh and recycled air quality Onboard Lavatory

Clean Cabin Sky Boutique Duty Free Service COVID-19 Service Information Flight Messaging Service

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At the Airport
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Arrival
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Wear face masks Cabin Disinfection & Cleaning Temperature checks Meal Carts Disinfection Social distancing Luggage Disinfection upon Arrival CAL Lounges are temporarily closed Safe Airport Journey Plan

CAL Ranked Top Global Cargo Carrier in 2019

With a fleet of 18 Boeing 747-400 freighters in operation and well-established network, CAL holds the edge on air cargo capacity during COVID-19.

	Airlines	Freight Tonnes Carried ('000)			Airlines	FRTK(m)
1st	Emirates	2,413		1st	Qatar Airways	13,024
2nd	Qatar Airways	2,281		2nd	Emirates	12,052
3rd	Federal Express	2,192		3rd	Cathay Pacific Airways	10,930
4th	Cathay Pacific Airways	1,716		4th	Federal Express	8,851
5th	United Parcel Service	1,539		5th	Korean Air	7,390
6th	Turkish Airlines	1,433		6th	Lufthansa	7,723
7th	Korean Air	1,383			
					
**8th **	China Airlines	1,374			
※ 201	9 Top Airlines by Internatio	nal Cargo Traffic		**13th **	China Airlines	5,334

※ 2019 Top Airlines by International Cargo Traffic

Expanding Cargo Service to Seize the window of Opportunity

CAL leverages Taiwan’s strategic position and cargo capacity to make 10% more cargo . flights per week

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• Utilize CAL 18 747-400 freighters

• Make the most of belly capacity of passenger aircraft

• Improve operational efficiency with 3 upcoming 777F deliveries

• Monthly route review and flexible route adjustment

• Priority for high-yield goods and regular project shipment for route profit boost

• Pursue charter or BSA business to maintain load factor and revenue uplift

34 destinations with 100 flights per week for freighter service

Post-COVID-19 Outlook

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24

New Normal of Air travel in Post-Covid-19 Age

Market

• Domestic and regional air travel will recover first.

• 3[rd] /4[th] traffic rights will be dominant and 6[th] traffic right will complement.

• Family visit and leisure travel will recover first.

• Local staycation becomes popular.

Passenger

• International travelers will be most concerned with safety.

• Wearing masks, checking temperatures, and cleaning hands throughout the journey will be required.

Service

• Digital solution will be implemented to reduce touchpoints literally in the check-in and boarding process

Post-COVID-19 Cargo Market Outlook

Potential Business

• COVID-19 has led to a major change in consumer behavior toward online channels. Online demand for essentials and entertainment has increased.

• Work-from-home triggers a jump in demand for chips, laptops and network goods.

• Vaccines against COVID-19 are under active development.

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Proactive COVID-19 Response Strategies

01[Conserve ] 02[Maintain ] 03 Integrate cash-flow business sales and & lower the continuity marketing cost and stability strategy

04[Rebuild ] 05[Comply with ] passenger regulations confidence to promote in air travel safe travel

Giving Back to Society and Creating Social Value

CAL wins awards for seventh consecutive year at the “Oscars” of Taiwan Corporate Sustainability- Taiwan Corporate Sustainability Awards (TCSA) and two consecutive year at Global Corporate Sustainability Awards (GCSA).

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Thank you

# We fly We fight # We will all be fine

China Airlines│No.1, Hangzhan S. Rd., Dayuan Dist., Taoyuan City, Taiwan TEL│03.399.8888

2020.12