CSCC — Investor Presentation 2016

Nov 25, 2016

China Steel Chemical Corp.

==> picture [731 x 10] intentionally omitted <==

----- Start of picture text -----

1
----- End of picture text -----

Table of Content

1.The Brief Introduction to CSCC

2.The Introduction of Coal Chemical Industries

3.The Industrial Use for CSCC

4.The New Products Development

~~China Steel Chemical Corp.~~

2

The Brief Introduction to CSCC

~~Chronology of Major Events~~

• 1.CSCC established in February 1989.

• 2.Plants completed during 1991~1993.

• 3.CSCC IPO listed in Taiwan in November, 1998

• 4.CSCC was awarded “Industrial Excellence Award “ and “National Outstanding SMES Award” in 2000 and 2001.

• 5.CSCC achieved OHSAS 18001 certification during 2001~2008.

• 6.CSCC achieved CNLA in April, 2002. And granted authentication in April 2005 and November, 2008.

• 7.Refined Naphthalene Unit expansion completed in April 2009.

• The capacity 1,400 MT/YR of Green Mesophase Powder Plant completed in January 2010.

• 9.The Light Oil Distillation plant phase 2 completed in April 2010.

10.The line G5/G6 of Green Mesophase Powder Plant reaching capacity to 2,600 MT/YR completed during the third quarter 2011.

• 11.The line G1N/G2N of Green Mesophase Powder Plant reaching capacity to 5,000 MT/YR completed by the end of 2012.

~~China Steel Chemical Corp.~~

3

The Brief Introduction to CSCC

The structure of shareholder

unit：per thousand stocks Major shareholder Shares Percentage China Steel Corporation 68,787 29.04% China Synthetic Rubber Corp 11,759 4.96% Fubon Life Insurance Co., Ltd. 9,735 4.11% Ever Wealthy International Corp. 5,077 2.14%

~~China Steel Chemical Corp.~~

4

The Brief Introduction to CSCC

’ ~~Table of academic degree in CSCC s employees~~

Academic Degree Number Percentage Doctor Degree 9 4％ Master Degree 64 27％ Bachelor Degree 99 42% Junior college and 64 27％ Senior high school Total 236 100％ As of：Oct, 2016

~~China Steel Chemical Corp.~~

5

The Brief Introduction to CSCC

Unit: NT$ thousands

	Mar-14	Apr-14	May-14	Jun-14	Jul-14	Aug-14	Sep-14	Oct-14		Total
Revenue	786,704	884,649	792,968	723,749	853,224	741,670	706,794	717,381		8,904,302
OperatingIncome	227,866	218,459	220,548	211,391	258,691	209,206	191,766	187,511		2,380,809
Net income before tax	251,402	224,116	230,627	241,950	264,809	223,360	221,772	193,038		2,567,737
Oil Price	104	104	106	108	105	100	96	86		96
	Mar-15	Apr-15	May-15	Jun-15	Jul-15	Aug-15	Sep-15	Oct-15		Total
Revenue	580,212	561,067	489,683	541,038	485,647	474,265	434,130	472,108		5,737,544
OperatingIncome	136,281	147,802	120,937	122,316	102,461	83,114	71,336	100,534		1,199,917
Net income before tax	156,163	140,757	126,744	144,510	126,091	94,037	129,546	100,394		1,441,863
Oil Price	53	58	63	62	55	46	47	47		51
	Mar-16	Apr-16	May-16	Jun-16	Jul-16	Aug-16	Sep-16	Oct-16		Total
Revenue	419,290	404,258	426,617	509,856	469,737	437,669	402,458	452,017		4,328,583
OperatingIncome	113,773	85,628	78,476	97,615	108,868	96,598	88,862	104,050		919,344
Net income before tax	112,981	92,279	95,094	103,328	109,380	94,359	92,749	114,900		980,902
Oil Price	37	41	46	48	44	45	45	49		42

6

The Brief Introduction to CSCC

Unit: NT$ millions

		2011	2011	2012	2012	2013	2013	2013	2014	2014	2015	2015	2016/ 1~10	2016/ 1~10
Revenue		8,915		8,257		8,820			8,904		5,737		*4,328
Net income after tax		2,247		1,974		2,221			2,189		1,239		*980
EPS(NT$)		9.76		8.58		9.60			9.50		5.37		-
* The announcement is based on self-reported consolidated net income before tax.
			20151Q		20152Q		20153Q	20154Q		20161Q		20162Q		20163Q
	EPS		1.70		1.53		1.30	0.84		1.02		1.04		1.10

China Steel Chemical Corp. 7

~~Dividend Payout~~

	2010	2011	2012	2013	2014	2015
EPS	8.3	9.7	8.5	9.6	9.5	5.37
Cash Div.	7.2	8.0	7.4	8.3	8.3	4.5
Stock Div	0	0	0	0	0	0

==> picture [117 x 47] intentionally omitted <==

==> picture [40 x 47] intentionally omitted <==

8

The Brief Introduction to CSCC

==> picture [741 x 278] intentionally omitted <==

----- Start of picture text -----

unit：metric tons
Period
2011 2012 2013 2014 2015 2016/1~10
Input
Coal Tar 213,284 203,920 264,578 266,814 257,506 226,853
Light Oil 80,921 77,971 93,609 100,930 100,220 81,133
----- End of picture text -----

~~China Steel Chemical Corp.~~ 9

Sales Revenue breakdown by products

	2014	2015	**2016/1Q **	**2016/2Q **	2016/3Q	2016/10
Light Oil	35%	33%	35%	31%	31%	28%
Benzene	29%	27%	29%	27%	26%	21%
Coal Tar	47%	44%	41%	44%	50%	54%
Creosote Oils	30%	23%	21%	23%	30%	22%
Soft Pitch	7%	10%	9%	11%	8%	20%
Naphthalene	8%	9%	9%	8%	10%	10%
Mesophase	5%	9%	10%	11%	7%	6%
Coke Breeze	9%	10%	10%	10%	10%	10%

10

The Relating Product Map of Coal Chemical Industries

==> picture [735 x 483] intentionally omitted <==

----- Start of picture text -----

Upstream Midstream
Downstream
、
CSC DS CSCC
Coke Small size
Coal Coke Carbon Additive
Oven coke
Hard Pitch
Soft
Negative Electrode
Pitch
Others
Dyes
Coal
Naphthalene
Tar Mothball
Carbon Black
Creosote Oils
Wood Preservative Oil
Styrene
Benzene
Alkyl benzene
Light
oil Toluene Solvent
11
----- End of picture text -----

The Relating Product Map of Coal Chemical Industries

==> picture [731 x 363] intentionally omitted <==

----- Start of picture text -----

COAL TAR
COKE
COAL
LIGHT OIL
OVEN
COKE
Coke
BREEZE
For Blast
Furnaces
China Steel Chemical Corp.
12
----- End of picture text -----

The Relating Product Map of Coal Chemical Industries

~~The Process of the Coal Tar Distillation~~ Products Plant

==> picture [166 x 180] intentionally omitted <==

----- Start of picture text -----

PITCH
NAPHTHALENE
CREOSOTE OILS
----- End of picture text -----

~~China Steel Chemical Corp.~~ 13

The Relating Product Map of Coal Chemical Industries

The Process of the Light Oil Distillation Plant

Products
Benzene
Toluene

~~China Steel Chemical Corp.~~

14

The Relating Product Map of Coal Chemical Industries

The Process of the Coke Breeze Plant

Products

Small size coke Fine size coke L size Coke arge

~~China Steel Chemical Corp.~~

15

The Relating Product Map of Coal Chemical Industries

==> picture [17 x 16] intentionally omitted <==

The Process of the Green Mesophase Powder plant

Products

Green Mesophase Powder Graphitization

Mesophase Graphite Powder

~~China Steel Chemical Corp~~

16

The Industrial Use for CSCC

17

China Steel Chemical Corp.

The Appliance of Soft Pitch

Soft Pitch

Primary Water and rust Green Mesophase electrode rod proofing materials Powder Active Carbon for Supercapacitor Mesophase Graphite Powder

Hard Pitch

Roofing Pitch

Electrode binder

==> picture [112 x 89] intentionally omitted <==

==> picture [171 x 126] intentionally omitted <==

==> picture [259 x 46] intentionally omitted <==

Lithium Ion Battery

==> picture [147 x 120] intentionally omitted <==

18

The Appliance of Naphthalene ~~Naphthalene~~

==> picture [685 x 61] intentionally omitted <==

Sulfonated naphthalene formaldehyde condensates

Β-naphthol, Phthalic Tobias acid, J- anhydride (PA) acid Mothballs PEN resin BON-6 Plasticizer

==> picture [104 x 90] intentionally omitted <==

Water-reducing admixture

Dyestuffs pigment

==> picture [153 x 145] intentionally omitted <==

==> picture [129 x 113] intentionally omitted <==

==> picture [259 x 46] intentionally omitted <==

19

The Appliance of Creosote oils

~~Creosote oils~~

==> picture [568 x 49] intentionally omitted <==

Carbon black

==> picture [246 x 138] intentionally omitted <==

Wood preservative oil

==> picture [105 x 76] intentionally omitted <==

==> picture [153 x 105] intentionally omitted <==

Wash oil

==> picture [146 x 122] intentionally omitted <==

==> picture [260 x 46] intentionally omitted <==

20

The Appliance of Benzene

~~Benzene~~

==> picture [556 x 50] intentionally omitted <==

Phenol Styrene Caprolactam Alkyl-benzene Epoxy resin paint detergents Nylon 6

External shell for 3C’s product and sport materials

==> picture [171 x 131] intentionally omitted <==

==> picture [190 x 131] intentionally omitted <==

==> picture [178 x 127] intentionally omitted <==

==> picture [165 x 125] intentionally omitted <==

==> picture [259 x 46] intentionally omitted <==

21

New Products Development

==> picture [18 x 17] intentionally omitted <==

High Soft Point Pitch (HSP):utilized as wrapping materials to cover carbon for Li-ion Batteries anode or as binder material for fireproofing material.

==> picture [18 x 17] intentionally omitted <==

High Soft Point Pitch is a special pitch which possesses a soft point higher than 260℃and have high fixed carbon ratio (ca. 80-85%). It is also utilized as carbon fiber precursor, because the production procedure of HSP is similar to the one of carbon fiber procedure.

==> picture [18 x 17] intentionally omitted <==

Nowadays, the pre-launch sample is provided to customers for testing as wrapping material for Li-ion batteries anode and fireproofing material. Mass production process design had been completed and evaluation of mass product line will be made after market expands.

22

New Products Development

==> picture [19 x 19] intentionally omitted <==

The quality of AC is great as Japan leading brand. The AC has already been sold worldwide.

==> picture [19 x 19] intentionally omitted <==

Due to the expansion of Li-ion batteries anode material, establishing graphitizing factory is planning. Studying abroad techniques of graphitization, evaluation of inductive graphitizing furnace and mass production plan are progressing.

23

Applications of Supercapacitors

~~PHEV~~

(Plug in hybrid electric vehicles )

==> picture [237 x 211] intentionally omitted <==

Also in…

E-Bus

==> picture [346 x 180] intentionally omitted <==

==> picture [125 x 124] intentionally omitted <==

==> picture [163 x 121] intentionally omitted <==

Light Rail Transit

Wind turbine

China Steel Chemical Corp. 24

Thank You