EVAAIR — AGM Information 2018

Jul 5, 2018

Stock Code: 2618

EVA Airways Corporation

2018 Annual General Shareholders' Meeting

Meeting Minutes

June 22, 2018

THIS IS A TRANSLATION OF THE MINUTES FOR THE 2018 ANNUAL SHAREHOLDERS' MEETING (THE "MINUTES") OF EVA AIRWAYS CORPORATION (THE "COMPANY"). THIS TRANSLATION IS INTENDED FOR REFERENCE ONLY AND NOTHING ELSE, THE COMPANY HEREBY DISCLAIMS ANY AND ALL LIABILITIES WHATSOEVER FOR THE TRANSLATION. THE CHINESE TEXT OF THE MINUTES SHALL GOVERN ANY AND ALL MATTERS RELATED TO THE INTERPRETATION THE OF SUBJECT MATTER STATED HEREIN.

EVA Airways Corporation

Minutes of 2018 Annual General Shareholders' Meeting

Meeting Time: June 22 (Friday), 2018 9:00 am

Meeting Location: Conference Hall (the 17th floor) EVA AIRWAYS CORPORATION No.376, Sec.1, Hsin-Nan Road, Luchu District, Taoyuan City, Taiwan (R.O.C.)

Attendance: There are 4,173,449,024 shares issued by the Company, the number of shareholder representatives attending (including electronic voting or by proxy) make up 2,938,749,040 shares, reaching 70.41% of the total issued shares.

Chairman: Lin, Bou-Shiu, the Chairman of the Board

Secretary: Ms. Chien, Wei-Tsen

• I. Report the total number of shares represented at this AGM and announce commencement of the meeting.
• Chairman's Address: Omitted. II.

III. Report Items:

• A. Business Report of the year 2017 (Handbook pages 5-9).
• B. Audit Committee's Review Report of the year 2017. (Handbook page 29).

Attendants as guest: Mr. Chien, You-Hsin, Independent Director / Mr. Hsu, Shun-Hsiung, Independent Director / Mr. Wu, Chung-Pao, Independent Director /Ms. Ko, Lee-Ching, Director / Mr. Tai, Jiin-Chyuan, Director / Mr. Sun, Chia-Ming, Director / Mr. Wu, Kuang-Hui, Director

• C. 2017 Employees' Compensation, Remuneration of Directors and Supervisors Report: The Board $\sigma$ f Directors appropriated NT\$221,020,000 as employees' compensation $in$ cash and NT\$11,669,863 as remuneration of Directors and Supervisors pursuant to the Articles of Incorporation.
• D. Corporate Bond Report: In order to repay the loans and reinforce the financial structure of the Company, the Board Meeting held on Aug. 10, 2017 resolved to issue the $3^rd$ Domestic Unsecured Convertible Bond. The Corporate Bond was issued with total amount of par value NT\$7,000,000,000, period of 5 years, and Coupon rate of $0\%$ . The registration of Corporate Bond issuance has become effective after being approved by Financial Supervisory Commission R.O.C (Taiwan) and has completed listing and trading on Taipei Exchange dated Oct. 27, 2017. Until April 24, 2018, the date of suspension of bond transfer, none of bondholder requests for conversion.

IV. Ratification and Discussion Items

Proposed by the Board of Directors

Proposal 1: Ratification of the 2017 Business Report and Audited Financial Report. (Handbook pages 5-27) Please ratify.

Description: The 2017 Financial Report of the Company has been audited by Ms. Chen, Ya-Ling and Mr. Wang, Ching-Sung, the CPA of KPMG Taiwan.

Voting Results	Electronic Votes	Aggregated Votes (Including) Electronic Votes)	% of the total Votes at the time of voting
Approval	2,078,795,354	2,720,971,265	92.58
Disapproval	858,542	858,542	0.02
Invalidation
Abstention/Unvote	216,520,332	216,925,404	7.38
Total	2,296,174,228	2,938,755,211	100

Proposal 2: Ratification of 2017 earnings distribution. (Handbook page 28) Please ratify.

Description:

• 1. The Company is planning to distribute stock dividend worth NT\$ 0.5 per share, which is 50 shares per 1,000 shares, and cash dividend NT\$0.2 per share. The total of stock dividends shall be NT\$2,086,724,520 (capital increase by earnings please refer to proposal 3), and the total of cash dividends shall he dividend distribution will NT\$834,689,805. The cash he calculated to the nearest NT dollar, the remainder will be recognized as "Other Non-Operating Income" of the Company.
• 1. If the number of total shares outstanding, prior to the ex-dividend date for the distribution, has changed due to the repurchasing of shares by the Company, the transfer, conversion, cancellation of treasury shares, or the conversion of shares from convertible bonds, etc., such that the ratios of the stock dividends and cash dividends are affected, the chairman of the Board of Directors is authorized to deal relative matters.
• 1. Subject to the approval of the annual general shareholders' meeting, the ex-dividend date and payment date for the cash dividend distributions would be decided by the Board of Directors.

Voting Results	Electronic Votes	Aggregated Votes (Including) Electronic Votes)	$\%$ of the total Votes at the time of voting
Approval	2,083,320,819	2,725,496,730	92.74
Disapproval	4,736,881	4,736,881	0.16
Invalidation
Abstention/Unvote	208,116,528	208,521,600	7.09
Total	2,296,174,228	2,938,755,211	100

Proposal 3: Proposal to approve the issuance of new shares for capital increase by earnings re-capitalization. Please discuss.

Description:

• 1. To strengthen the financial and capital structure of the Company, it is proposed to increase capital NT\$2,086,724,520 from 2017 retained earnings as well as to issue 208,672,452 new shares, par value NT\$10. The paid-in capital will be NT\$43,821,214,760 after new shares are issued.
• 1. According to the proposed capital increase plan, 50 common shares will be distributed for every 1,000 common shares, which is recorded in the shareholders' books and calculated as their shares held on the ex-dividend date. And the fractional shares shall be subscribed in cash at NT\$10 par value per share by the person nominated by the Chairman authorized by the Board of Directors.
• 1. The new shares issued by the capital increase will carry the same rights and obligations as the current outstanding shares.
• 1. The capital increase plan shall be submitted to the competent authority for approval and the ex-dividend date will be decided at the Board Meeting after approval at the Shareholders' Meeting.
• 1. The Board of Directors is authorized to make any necessary amendments to the capital increase plan due to the needs of actual practices or by the instructions of the competent authority.

Voting Results	Electronic Votes	Aggregated Votes (Including) Electronic Votes)	% of the total Votes at the time of voting
Approval	2,086,969,874	2,729,145,785	92.86
Disapproval	1,071,610	1,071,610	0.03
Invalidation
Abstention/Unvote	208, 132, 744	208,537,816	7.09
Total	2,296,174,228	2,938,755,211	100

Proposal 4: Proposal to approve the release of restrictions of competitive activities of the Director. Please discuss.

Description:

• 1. Directors who, for themselves or others run businesses which are similar to the business of the Company, shall report to and obtain permission from the shareholders' meeting.
• 1. The competitive activities of the Director are as shown in the following table. Therefore, the release of restrictions of competitive activities of the Director is proposed to the Shareholders' Meeting for approval. (Exhaustive list of Concurrent Positions in Other Companies as Handbook page $30.)$

Director	Concurrent Positions in Other Companies	The Business which is similar to the Company's
Chang Yung-Fa Charity Foundation Representative : Sun, Chia-Ming	The Director of Uni Civil Air Airways Corp.	Transport Enterprise

Voting Results	Electronic Votes	Aggregated Votes (Including)	% of the total Votes at the
		Electronic Votes)	time of voting
Approval	2,024,650,865	2,666,826,776	90.74
Disapproval	1,453,476	1,453,476	0.04
Invalidation
Abstention/Unvote	270,069,887	270,474,959	9.20
Total	2,296,174,228	2,938,755,211	100

V. Extraordinary Motions: None.

VI. Meeting Adjournment

• Notes 1: The meeting minutes was recorded in accordance with the provision of paragraph 4 of Article 183 of the Company Law. The meeting audio recording still prevails regarding the meeting content, proceedings and shareholders' statements.
• Notes 2: Because the percentage of approval votes, disapproval votes, invalid votes, abstention votes and no votes held by total votes is calculated rounded down to the second decimal place, the total percentage will not be exactly equal to 100.00%.

EVA AIRWAYS CORP. AND ITS SUBSIDIARIES (Expressed in Thousands of New Taiwan Dollars) Consolidated Balance Sheets
December 31, 2017 and 2016

$\ddot{\phantom{0}}$

		2017.12.31		2016.12.31				2017.12.31	2016.12.31
	Current assets: Assets	Amount	L $\mathbf I$ $\geqslant$	Amount	$\sim$		Liabilities and Equity Current liabilities:	$\mathcal{S}$ Amount	℅ Amount
$\frac{8}{100}$	Cash and cash equivalents (note 6(a))	41,685,780 69		44,933,016	$\overline{a}$	2100	Short-term borrowings (note 6(k))	100,000 s,	50,000
$\frac{1}{2}$	Financial assets at fair value through profit or loss-current (note 6(b))			2,329		2125	Derivative financial liabilities for hedge purposes - current (note 6(c))	558	213,266
1125	Available-for-sale financial assets - current (note 6(b))	1,855,681		1,916,316		2170	Notes and accounts payable	8,996,556	5,273,493
1135	Derivative financial assets for hedge purposes-current (note 6(c))	184,458		62,936		2180	Accounts payable - related parties (note 7)	195,049	155,959
1150	Notes receivable, net (note 6(d))	752,584		545,549		2200	Other payables (notes 6(s), 7 and 11)	8,878,362	12,273,634	۴
1170	Accounts receivable, net (note 6(d))	8,107,788		1,152,963		2230	Current tax liabilities	480,646	300,960
1180	Accounts receivable-related parties (notes 6(d) and 7)	5,018,412		3,644,373		2310	Unearned revenue (note 6(r))	16,811,771	14,917,497
130x	Inventories (notes 6(e) and 7)	9,424,190		8,816,238		2320	Current portion of long-term liabilities (notes 6(k) and 8)	$\bullet$ 19,314,836	20,628,946
1470	Other current assets (notes $6(d)$ , $6(j)$ and $7$ )	,973,447		2,301,643		2300	Other current liabilities (notes 6(h), 6(k) and 6(l))	$\mathbf{c}$ 5,650,430	8,471,178
	Total current assets	69,002,340	$\approx$	69,375,363	32		Total current liabilities	27 60,428,208	62,284,933	$\mathbf{S}$
	Non-current assets:						Non-current liabilities:
1523	Available-for-sale financial assets -- non-current (note 6(b))	2,549,212		3,013,540		2500	Financial liabilities at fair value through profit or loss-non-current (notes 6(b) and	16,800
1550	Investments accounted for using equity method (note 6(f))	681,192		621,586			6(k))
1600	Property, plant and equipment (notes 6(c), 6(h), 6(l), 7, 8 and 9)	135,017,379	S	25,481,847	58	2510	Derivative financial liabilities for hedge purposes - non-current (note 6(c))		49,712
1780	Intangible assets (note 6(i))	2,078,673		2,170,781		2530	Bonds payable (note 6(k))	15,096,232	13,000,000	۰
1840	Deferred tax assets (note 6(0))	4,093,167		4,649,327		2540	Long-term borrowings (notes 6(k) and 8)	$\frac{8}{2}$ 60,248,858	57,385,036	$\delta$
1900	Other non-current assets (notes $6$ (c), $6(j)$ , $7$ , $8$ and $9$ )	14,785,265		12,350,960	$\circ$	2570	Deferred tax liabilities (note 6(o))	155,686	100,233
	Total non-current assets	159,204,888		148,288,041	68	2613	Lease liabilities -- non-current (note 6(k))	2,152,643	3,575,432
						2640	Net defined benefit liabilities - non-current (note 6(n))	5,300,094	4,849,692
						2600	Other non-current liabilities (notes 6(h), 6(l) and 6(r))	ବା 20,599,199	17,082,085	∞
							Total non-current liabilities	45 103,569,512	96,042,190	4
							Total liabilities	$\overline{r}$ 163,997,720	$\mathfrak{r}$ 58,327,123
							Equity (notes $6(c)$ , $6(k)$ , $6(n)$ , $6(o)$ and $6(p)$ ):
						3110	Common stock	$\approx$ 41,734,490	40,518,923	≘
						3200	Capital surplus	6,639,940	6,237,027
						3300	Retained earnings	4 8,672,249	5,702,366	$\mathbf{\hat{c}}$
						3400	Other equity	961.044	869,879
							Total equity attributable to owners of parent	25 58,007,723	53,328,195	$\boldsymbol{z}$
						36XX	Non-controlling interests (notes 6(g) and 6(p))	6,201,785	6,008,086
							Total equity	64,209,508	21 59,336,281
	Total assets	228,207,228	$\parallel$ 뤠	217,663,404	훽		Total liabilities and equity	$\frac{8}{100}$ 228,207,228	힄 217,663,404

See accompanying notes to consolidated financial statements.

EVA AIRWAYS CORP. AND ITS SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2017 and 2016

(Expressed in Thousands of New Taiwan Dollars, Except Earnings Per Share)

		2017		2016
		Amount	%	Amount	%
4000	Operating revenue (notes $6(r)$ and 7)	\$163,561,731	100	144,679,665	100
5000	Operating costs (notes 6(c), 6(e), 6(h), 6(i), 6(m), 6(n), 6(s), 7 and 9)	(142, 367, 803)	(87)	(125, 603, 014)	(87)
	Gross profit from operations	21,193,928	13	19,076,651	13
6000	Operating expenses (notes $6(d)$ , $6(h)$ , $6(i)$ , $6(m)$ , $6(n)$ , $6(s)$ and 7)	(12, 499, 014)	(8)	(11, 946, 717)	(8)
	Net operating income	8,694,914	5	7,129,934	$\overline{5}$
	Non-operating income and expenses:
7010	Other income (note $6(t)$ )	543,099		416,747
7020	Other gains and losses (notes $6(b)$ , $6(1)$ , $6(p)$ and $6(t)$ )	574,647	1	(566, 937)
7050	Finance costs (notes $6(h)$ , $6(l)$ ) and $6(t)$ )	(2,002,438)	(1)	(1,807,997)	(1)
7060	Shares of profit of associates accounted for using equity method (note $6(f)$ )	165,898	$\blacksquare$	125,176
	Total non-operating income and expenses	(718, 794)	$\sim$	(1, 833, 011)	(1)
7900	Profit before tax	7,976,120	5	5,296,923	$\overline{4}$
7950	Income tax expenses (note 6(0))	(1,665,186)	(1)	(1,343,256)	(1)
8200	Profit	6,310,934	$\overline{4}$	3,953,667	3
8300	Other comprehensive income (notes $6(c)$ , $6(f)$ , $6(n)$ , $6(o)$ and $6(p)$ ):
8310	Items that will not be reclassified subsequently to profit or loss:
8311	Remeasurements of the net defined benefit plans	(1,030,637)	(1)	(1,334,982)	(1)
8320	Share of other comprehensive income of associates accounted for using equity method	(1, 349)		(4,967)
8349	Income tax benefit relating to items that will not be reclassified subsequently to profit or loss	175,223		236,196
	Total items that will not be reclassified subsequently to profit or loss	(856, 763)	(1)	(1,103,753)	(1)
8360	Items that may be reclassified subsequently to profit or loss:
8361	Exchange differences on translation of foreign financial statements	(51, 434)		(85, 912)
8362	Unrealized gains (losses) on available-for-sale financial assets	(171, 305)		500,125
8363	Cash flow hedges	383,942		3,347,709	$\boldsymbol{2}$
8370	Share of other comprehensive income of associates accounted for using equity method	(11,012)		(1, 324)
8399	Income tax losses relating to items that may be reclassified subsequently to profit or loss	(63, 111)		(572, 489)
	Total items that may be reclassified subsequently to profit or loss	87,080	$\qquad \qquad \blacksquare$	3,188,109	2
8300	Other comprehensive income, net of tax	(769, 683)	(1)	2,084,356	1
8500	Comprehensive income	5,541,251	3	6,038,023
	Profit, attributable to:
8610	Owners of parent	\$ 5,752,067	4	3,476,004	3
8620	Non-controlling interests	558,867		477,663
		\$ 6,310,934		3,953,667
	Comprehensive income attributable to:
8710	Owners of parent	\$ 5,086,994	3	5,627,064	4
8720	Non-controlling interests	454,257		410,959
		5,541,251	$\overline{\mathbf{3}}$	6,038,023
	Earnings per share (note $6(q)$ )
9750	Basic earnings per share (in New Taiwan Dollars)	1.38 S		0.83
9850	Diluted earnings per share (in New Taiwan Dollars)	1.24 s		0.83

See accompanying notes to consolidated financial statements.

EVA AIRWAYS CORP. AND ITS SUBSIDIARIES For the years ended December 31, 2017 and 2016 (Expressed in Thousands of New Taiwan Dollars) Consolidated Statements of Changes in Equity

Attributable to owners of parent

Total equity
54,727,522 $(271, 581)$ $(1,157,683)$ $(810,379)$ 402,913 $(769, 683)$ $(260, 558)$ 3,953,667 2,084,356 6,038,023 59,336,281 6,310,934 64,209,508 5,541,251 $\overline{1}$ interests
5,868,708 477,663 $(66, 704)$ 410,959 $(271, 581)$ 558,867 $104,610$ $(260, 558)$ 6,008,086 6,201,785 454,257 Non-
controlling $(1,157,683)$ Total equity
attributable to
owners of $(810,379)$ $(665,073)$ $\frac{\text{parent}}{48,858,814}$ 402,913 3,476,004 2,151,060 53,328,195 5,752,067 58,007,723 5,627,064 5,086,994 $\overline{a}$ j $\frac{\text{Total}}{(2,314,892)}$ 91.165 91,165 3,184,771 869,879 961,044 3,184,771 $rac{\text{hedges}}{(2,944,633)}$ ,778,598 $(166, 035)$ 2,778,598 318,672 152,637 318,672 Cash flow Other equity $\frac{\text{final assets}}{492.544}$ $(170, 587)$ 989,845 819,258 gains (losses)
on available-
for-sale 497,301 $(170, 587)$ 497,301 Unrealized $(56.92)$ Exchange
differences on
translation of
foreign
financial $(10.851)$ $\frac{\text{statements}}{137.197}$ $(91, 128)$ $(91, 128)$ 46,069 $(56, 920)$ $(1,157,683)$ $(756, 238)$ $\frac{Total}{6,347,229}$ $(1,033,711)$ $(810,379)$ $(1,929,473)$ $(1,215,567)$ 3,476,004 2,442,293 5,702,366 5,752,067 4,995,829 8,672,249 $(347,600)$
2,314,892
(810,379) earnings
$5,596,970$ $(1,564,633)$ $(1,157,683)$ $(1,929,473)$ Unappropriated
retained $(643, 643)$ $1,033,711$ $(1, 215, 567)$ 3,476,004 2,442,293 $(756, 238)$ 5,752,067 4,995,829 2,743,831 7,681,006 Retained earnings 1,564,633 $(2,314,892)$ 750.259 2,314,892 Special reserve 643,643 347,600 643,643 991.243 Legal
reserve $\overline{a}$ 402,913 6,237,027 6,639,940 6,237,027 Capital aurplus 40,518,923 1,929,473 1,215,567 38,589,450 41,734,490 Common
stock J. Issuance of convertible bonds recognized in capital
surplus-share options Stock dividends to common shareholders Stock dividends to common shareholders Cash dividends to common shareholders Cash dividends to common shareholders Appropriation of prior year's earnings: Appropriation of prior year's earnings: Change in non-controlling interests Change in non-controlling interests Balance on December 31, 2016 Balance on December 31, 2017 Balance on January 1, 2016 Other comprehensive income Other comprehensive income Special reserve reversal Comprehensive income Comprehensive income Special reserve Legal reserve Legal reserve Profit Profit

EVA AIRWAYS CORP. AND ITS SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2017 and 2016 (Expressed in Thousands of New Taiwan Dollars)

	2017	2016
Cash flows from (used in) operating activities:
Profit before tax	\$ 7,976,120	5,296,923
Adjustments:
Adjustments to reconcile profit:
Depreciation expense	13,936,758	15,051,372
Amortization expense	383,555	357,654
Net losses (gains) on financial assets and liabilities at fair value through profit or loss	(7,700)	1,091
Impairment loss		5,345
Interest expense	2,002,438	1,807,997
Interest income	(411,330)	(278, 831)
Dividend income	(131, 461)	(139, 433)
Shares of profit of associates accounted for using equity method	(165, 898)	(125, 176)
Losses on disposal of property, plant and equipment	70,311	459,172
Gains on disposal of investments	(625, 974)	(49, 465)
Unrealized foreign exchange gains	(1,468,529)	(386,960)
Others	(260, 184)	(175, 712)
Total adjustments to reconcile profit	13,321,986	16,527,054
Changes in operating assets and liabilities:
Changes in operating assets:
Financial assets at fair value through profit or loss - current	2,329
Notes receivable, net	(207, 035)	(132,908)
Accounts receivable, net	(956, 588)	(637, 931)
Accounts receivable-related parties	(1,375,320)	(38, 326)
Inventories	(723, 261)	(331, 812)
Other current assets	309,439	(273,068)
Total changes in operating assets	(2,950,436)	(1,414,045)
Changes in operating liabilities:
Notes and accounts payable	3,718,535	2,484,572
Accounts payable - related parties	39,482	62,807
Other payables	(3,124,629)	304,552
Unearned revenue	1,897,585	1,544,354
Other current liabilities	(2, 492, 173)	(3, 122, 997)
Net defined benefit liabilities – non-current	(579, 237)	(495, 367)
Other non-current liabilities	608,421	504,616
Total changes in operating liabilities	67,984	1,282,537
Total changes in operating assets and liabilities	(2,882,452)	(131, 508)
Total adjustments	10,439,534	16,395,546
Cash inflow generated from operations	18,415,654	21,692,469
Income taxes paid	(764, 188)	(536, 523)
Net cash flows from operating activities	17,651,466	21,155,946

EVA AIRWAYS CORP. AND ITS SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2017 and 2016 (Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) investing activities: Available-for-sale financial assets - current \$ 70,380 Acquisition of available-for-sale financial assets - non-current (24, 620) Proceeds from disposal of available-for-sale financial assets - non-current 944,169 44,937 Proceeds from disposal of investments accounted for using equity method 12,353 Acquisition of property, plant and equipment (13, 398, 285) (8,146,659) Proceeds from disposal of property, plant and equipment 195,367 471,915 Acquisition of intangible assets (291, 447) (255, 678) Other non-current assets 58,219 22,955 Increase in prepayments for equipment (9,857,878) (8,826,289) Interest received 280,605 411,605 Dividends received 213,587 236,527 Net cash flows used in investing activities (21, 402, 355) (16, 551, 202) Cash flows from (used in) financing activities: Increase in short-term borrowings 400,000 10,720,000 Decrease in short-term borrowings (350,000) (11, 410, 000) Proceeds from issuance of bonds payable 7,009,018 8,500,000 Redemption of bonds payable (6,500,000) (5,100,000) Proceeds from long-term borrowings 18,411,000 22,296,300 Redemption of long-term borrowings (14, 421, 475) (15, 587, 774) Increase in guarantee deposits 5,396 76,025 Redemption of lease liabilities (1,496,591) (1,877,310) Cash dividends paid (810, 379) (1, 157, 683) Interest paid (1,461,467) (1, 577, 124) Change in non-controlling interests (252, 207) (260, 055) Net cash flows from financing activities 525,447 4,630,227 Effect of exchange rate changes on cash and cash equivalents (21, 794) (46, 820) Net increase (decrease) in cash and cash equivalents (3,247,236) 9,188,151 Cash and cash equivalents at the beginning of year 44,933,016 35,744,865 Cash and cash equivalents at the end of year 41,685,780 44,933,016		2017	2016
(114, 836) (484)

See accompanying notes to consolidated financial statements.

EVA AIRWAYS CORP.	Balance Sheets	December 31, 2017 and 2016	Expressed in Thousands of New Taiwan Dollars)

		2016.12.31 2017.12.31			2017.12.31		2016.12.31
	Current assets: Assets	$\sim$ Amount $\mathcal{S}^{\bullet}$ Amount		Liabilities and Equity	Amount	℅	Amount	$\epsilon$
				Current liabilities:
$\frac{8}{10}$	Cash and cash equivalents (note 6(a))	$\overline{a}$ 37,874,856 35,432,733 S	2125	Derivative financial liabilities for hedge purposes-current (note 6(c))	558 S		213,266
1125	Available-for-sale financial assets - current (note 6(b))	1,522,021 1,525,795	2170	Accounts payable	5,773,798		2,830,454
1135	Derivative financial assets for hedge purposes - current (note 6(c))	62,936 184,458	2180	Accounts payable-related parties (note 7)	1,903,298		2,462,819
1150	Notes receivable, net (note 6(d))	544,584 751,534	2200	Other payables (notes 6(r), 7 and 9)	7,519,714		10,887,586
1170	Accounts receivable, net (note 6(d))	5,788,388 5,792,428	2230	Current tax liabilities (note 6(n))	140,879
1180	Accounts receivable-related parties (notes 6(d) and 7)	395,991 478,744	2310	Uneamed revenue (note 6(q))	16,316,960	∞	14,608,324	∞
130x	Inventories (notes $6(e)$ and 7)	1,661,856 1,399,784	2320	Current portion of long-term liabilities (notes 6(j) and 8)	16,050,521	$\infty$	17,379,084
1470	Other current assets (notes 6(d),6(i) and 7)	1,672,000 1,473,008	2300	Other current liabilities (notes $6(g)$ , $6(j)$ and $6(k)$ )	5,508,040	$\mathbf{\Omega}$	8,391,254
	Total current assets	25 49,522,632 $\mathbb{Z}$ 47,038,484		Total current liabilities	53,213,768	$\frac{26}{5}$	56,772,787	29
	Non-current assets:			Non-current liabilities:
1523	Available-for-sale financial assets -- non-current (note 6(b))	2 2,974,781 2,503,536	2500	Financial liabilities at fair value through profit or loss-non-current
1550	Investments accounted for using equity method (note 6(f))	13,905,359 14,415,673		(notes 6(b) and 6(j))	16,800
1600	Property, plant and equipment (notes 6(c), 6(g), 6(k),7,8 and 9)	ఞ 12,986,912 3 119,481,891	2510	Derivative financial liabilities for hedge purposes-non-current (note 6(c))			49,712
1780	Intangible assets (note 6(h))	493,089 493,403	2530	Bonds payable (note 6(j))	15,096,232	œ	13,000,000
1840	Deferred tax assets (note 6(n))	4,037,265 3,451,704	2540	Long-term borrowings (notes 6(j) and 8)	47,583,959	$\overline{c}$	47,806,493	$\overline{24}$
1900	Other non-current assets (notes $6(c)$ , $6(i)$ , $8$ and $9$ )	$\circ$ 11,829,696 13,761,377	2570	Deferred tax liabilities (note 6(n))	134,068		60,294
	Total non-current assets	75 146,227,102 154,107,584	2613	Lease liabilities - non-current (note 6(j))	2,152,643		3,575,432
			2640	Net defined benefit liabilities - non-current (note 6(m))	4,385,296		4,118,751
			2600	Other non-current liabilities (notes $6(g)$ , $6(k)$ and $6(q)$ )	20,555,579	$\overline{10}$	17,038,070	$\circ$
				Total non-current liabilities	89,924,577	45	85,648,752	$\frac{4}{3}$
				Total liabilities	143,138,345	٢	142,421,539	73
				Equity (notes $6(c)$ , $6(j)$ , $6(m)$ , $6(n)$ and $6(o)$ ):
			3110	Common stock	41,734,490	ដ	40,518,923	ត
			3200	Capital surplus	6,639,940		6,237,027
			3300	Retained earnings	8,672,249		5,702,366
			3400	Other equity	961,044		869,879
				Total equity	58,007,723	$\overline{29}$	53,328,195	27
	Total assets	흷 195,749,734 휇 201,146,068		Total liabilities and equity	201,146,068	$\frac{100}{100}$	195,749,734	힄

See accompanying notes to financial statements.

Statements of Comprehensive Income

For the years ended December 31, 2017 and 2016

(Expressed in Thousands of New Taiwan Dollars, except Earnings Per Share)

		2017		2016
		Amount	%	Amount	%
4000	Operating revenue (notes $6(q)$ and 7)	\$125,314,160	100	115,495,819	100
5000	Operating cost (notes 6(c), 6(e), 6(g), 6(h), 6(k), 6(l), 6(m), 6(r) and 7)	(107, 862, 932)	(86)	(99,612,331)	(86)
	Gross profit from operations	17,451,228	14	15,883,488	14
6000	Operating expenses (notes $6(g)$ , $6(h)$ , $6(l)$ , $6(m)$ , $6(r)$ and 7)	(11,508,710)	(9)	(10,922,049)	(9)
	Net operating income	5,942,518	5	4,961,439	5
	Non-operating income and expenses:
7010	Other income (note $6(s)$ )	491.051		366,343
7020	Other gains and losses (notes $6(i)$ , $6(k)$ , $6(0)$ , $6(s)$ and 7)	773,604	1	(579, 724)	(1)
7050	Finance costs (notes $6(g)$ , $6(j)$ , $6(k)$ and $6(s)$ )	(1, 839, 812)	(1)	(1,641,912)	(1)
7375	Share of profit of subsidiaries and associates accounted for using equity method (note $6(f)$ )	1,518,572	-1	1,261,888	-1
	Total non-operating income and expenses	943,415	$\mathbf{1}$	(593, 405)	(1)
7900	Profit before tax	6,885,933	6	4,368,034	$\overline{\mathbf{4}}$
7950	Income tax expenses (note $6(n)$ )	(1, 133, 866)	(1)	(892,030)	(1)
8200	Profit	5,752,067	5	3,476,004	3
8300	Other comprehensive income (notes $6(c)$ , $6(f)$ , $6(m)$ , $6(n)$ and $6(0)$ ):
8310	Items that will not be reclassified subsequently to profit or loss:
8311	Remeasurements of the net defined benefit plans	(640, 200)	(1)	(1,032,186)	(1)
8330	Share of other comprehensive income of subsidiaries and associates accounted for using equity method	(224, 872)		(176,997)
8349	Income tax benefit relating to items that will not be reclassified subsequently to profit or loss	108,834		175,472
	Total items that will not be reclassified subsequently to profit or loss	(756, 238)	(1)	(1,033,711)	(1)
8360	Items that may be reclassified subsequently to profit or loss:
8361	Exchange differences on translation of foreign financial statements	(48, 111)		(90,069)
8362	Unrealized gains (losses) on available-for-sale financial assets	(181, 561)		501,358
8363	Cash flow hedges	383,942		3,347,709	3
8380	Share of other comprehensive income of subsidiaries and associates accounted for using equity method	(55)		(1,673)
8399	Income tax losses relating to items that may be reclassified subsequently to profit or loss	(63,050)		(572, 554)
	Total items that may be reclassified subsequently to profit or loss	91,165	$\blacksquare$	3,184,771	3
8300	Other comprehensive income, net of tax	(665,073)	(1)	2,151,060
8500	Comprehensive income	5,086,994	4	5,627,064	5
	Earnings per share (note $6(p)$ )
9750	Basic earnings per share (in New Taiwan Dollars)	1.38		0.83
9850	Diluted earnings per share (in New Taiwan Dollars)	1.24 \$		0.83

For the years ended December 31, 2017 and 2016 (Expressed in Thousands of New Taiwan Dollars) Statements of Changes in Equity EVA AIRWAYS CORP.

				Retained earnings				Other equity
					Unappropriated		differences on translation of Exchange	Unrealized gains (losses) on
	Common	Capital	eserve Legal	reserve Special	carnings retained	Total	foreign financial	available-for-sale	Cash flow hedges	Total
Balance at January 1, 2016	$\frac{\text{stock}}{38,589,450}$ lမ	surplus $6,237,027$		750,259	5,596,970	6,347,229	137,197 statements	492,544 financial assets	(2,944,633)	(2,314,892)	48,858,814 Total equity
Appropriation of prior year's earnings:
Legal reserve			643,643		(643, 643)
Special reserve				1,564,633	(1,564,633)
Cash dividends to common shareholders					(1,157,683)	1,157,683)					(1,157,683)
Stock dividends to common shareholders	1,929,473				(1,929,473)	(1,929,473)
Profit					3,476,004	3,476,004					3,476,004
Other comprehensive income					1,033,711)	(1,033,11)	(91, 128)	497,301	2,778,598	3,184,77	2,151,060
Comprehensive income					2,442,293	2,442,293	(91, 128)	497,301	2,778,598	3,184,77	5,627,064
Balance on December 31, 2016	40,518,923	6,237,027	643,643	2,314,892	2,743,831	5,702,366	46,069	989,845	(166, 035)	869,879	53,328,195
Appropriation of prior year's earnings:
Legal reserve			347,600		(347, 600)
Special reserve reversal				(2,314,892)	2,314,892
Cash dividends to common shareholders					(810,379)	(810, 379)					(810,379)
Stock dividends to common shareholders	1,215,567				(1, 215, 567)	(1,215,567)
Issuance of convertible bonds recognized in capital surplus-share options		402,913									402,913
Profit					5,752,067	5,752,067					5,752,067
Other comprehensive income					(756, 238)	(756, 238)	(56.920)	170,587	318,672	91,165	(665,073)
Comprehensive income					4,995,829	4,995,829	(56, 920)	(170, 587)	318,672	91,165	5,086,994
Balance on December 31, 2017	41,734,490	6,639,940	91,243 I		7,681,006	8,672,249	10,851	819258	152,637	961,044	58,007,723
Note: Entitle years and all and and 21, 2016, the Company's recognized the directions and annonces continuous and and and son concentralistic surface									$0.91$ $0.000$ $0.14$ $0.000$

Note: For the years ended December 31, 2017 and 2016, the Company's recognized the directors' and supervisors' remuneration were \$11,670 and \$9,500, respectively, employee compensation were \$221,020 and \$145,590, respectiv

Statements of Cash Flows

For the years ended December 31, 2017 and 2016 (Expressed in Thousands of New Taiwan Dollars)

	2017	2016
Cash flows from (used in) operating activities:
Profit before tax	6,885,933 \$	4,368,034
Adjustments:
Adjustments to reconcile profit:
Depreciation expense	12,956,693	14,169,004
Amortization expense	200,851	185,682
Net gains on financial liabilities at fair value through profit or loss	(7,700)	$\ddot{\phantom{1}}$
Interest expense	1,839,812	1,641,912
Interest income	(359, 659)	(228, 814)
Dividend income	(131, 392)	(137, 529)
Share of profit of subsidiaries and associates accounted for using equity method	(1,518,572)	(1, 261, 888)
Losses on disposal of property, plant and equipment	69,866	460,596
Gains on disposal of investments	(625, 351)	(48, 693)
Unrealized foreign exchange gains	(1,468,529)	(386,960)
Others	(252, 121)	(155, 828)
Total adjustments to reconcile profit	10,703,898	14,237,482
Changes in operating assets and liabilities:
Changes in operating assets:
Notes receivable, net	(206,950)	(134, 169)
Accounts receivable, net	(4,040)	(670, 242)
Accounts receivable-related parties	(82,753)	(84,934)
Inventories	147,544	(46, 672)
Other current assets	180,836	(263, 610)
Total changes in operating assets	34,637	(1, 199, 627)
Changes in operating liabilities:
Accounts payable	2,943,344	1,613,022
Accounts payable-related parties	(559, 521)	18,722
Other payables	(3,178,277)	360,129
Unearned revenue	1,708,636	1,366,970
Other current liabilities	(2,555,878)	(3,127,721)
Net defined benefit liabilities – non-current	(373, 655)	(322, 867)
Other non-current liabilities	604,791	501,766
Total changes in operating liabilities	(1,410,560)	410,021
Total changes in operating assets and liabilities	(1,375,923)	(789, 606)
Total adjustments	9,327,975	13,447,876
Cash inflow generated from operations	16,213,908	17,815,910
Income taxes paid	(271, 466)	(97, 159)
Net cash flows from operating activities	15,942,442	17,718,751

Statements of Cash Flows

For the years ended December 31, 2017 and 2016

(Expressed in Thousands of New Taiwan Dollars)

		2017	2016
Cash flows from (used in) investing activities:
Available-for-sale financial assets - current	\$	2,068	781
Acquisition of available-for-sale financial assets - non-current		(24, 620)
Proceeds from disposal of available-for-sale financial assets-non-current		943,106	44,937
Acquisition of investments accounted for using equity method		(1)	(1)
Proceeds from disposal of investments accounted for using equity method		9.337	12,353
Acquisition of property, plant and equipment		(9,812,775)	(5,500,378)
Proceeds from disposal of property, plant and equipment		457,550	183,453
Acquisition of intangible assets		(201, 165)	(223, 593)
Decrease in other non-current assets		20,865	91,210
Increase in prepayments for equipment		(8,802,553)	(8,122,044)
Interest received		360,926	230,356
Dividends received		859,928	911,991
Net cash flows used in investing activities		(16, 187, 334)	(12, 370, 935)
Cash flows from (used in) financing activities:
Proceeds from issuance of bonds payable		7,009,018	8,500,000
Redemption of bonds payable		(6,500,000)	(5,100,000)
Proceeds from long-term borrowings		11,857,700	14,921,000
Redemption of long-term borrowings		(10,968,867)	(10,320,121)
Increase in gurantee deposits		4,381	75,601
Redemption of lease liabilities		(1.496, 591)	(1,877,310)
Cash dividends paid		(810, 379)	(1, 157, 683)
Interest paid		(1,292,493)	(1,405,080)
Net cash flows from financing activities		(2, 197, 231)	3,636,407
Net increase (decrease) in cash and cash equivalents		(2,442,123)	8,984,223
Cash and cash equivalents at the beginning of year		37,874,856	28,890,633
Cash and cash equivalents at the end of year	S	35,432,733	37,874,856

$\ddot{\phantom{a}}$

2017 Profit Allocation Proposal

Unit: NT\$

Item	Amount
Unappropriated Retained Earnings at Beginning of the Year		2,685,176,922
Subtract: Actuarial Loss of 2017	(756, 238, 372)
Add: Net Income of 2017	5,752,066,865
Subtract: Legal Reserve	(575, 206, 687)	4,420,621,806
Retained Earnings Available for Distribution as of December 31, 2017		7,105,798,728
Distribution Items:
Stock Dividends to Common Shareholders (NT\$0.5 per share)	2,086,724,520
Cash Dividends to Common Shareholders ((NT\$0.2 per share)	834,689,805	2,921,414,325
Unappropriated Retained Earnings at the End of the Year		4,184,384,403