FH — Interim / Quarterly Report 2018

May 30, 2018

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Global Steel Industry Overview and a Brief Introduction to Feng Hsin Steel Co., Ltd.

2018/05/31

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Company Profile

(1) Company Founded: January, 1969 (2) Capitial: NTD5.8 Billion (3) Number of Employees: About 848 (4) Location: Houli, Taichung Taiwan (5) Facilities: 85 MT DC Arc Furnace x 1 100 MT AC Arc Furance x 1 Rolling Line x 3 (6) 2017 Annual Production: Semi-Finished Proudct: Billet 1,524,886 MT Finished Product : Merchant Bar 421,957 MT Round Bar 423,523 MT Rebar 595,844 MT Total 1,441,324 MT (7) 2017 Net Sales: NTD 24,741,937 Thousand

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1. 2003-2017 World Major Crude Steel Producers by Country (MT)

Unit: million ton

	2003	2004	2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	2015	2016	2017
Mainland China	222	273	356	421	490	512	577	639	702	731	822	823	804	808	832
Japan	111	113	112	116	120	119	88	110	108	107	111	111	105	105	105
U.S.A	94	100	95	98	98	92	59	80	86	89	87	88	79	79	82
India	32	33	46	49	53	58	64	69	73	77	81	87	89	96	101
S.Korea	46	48	48	48	52	54	49	59	69	69	66	72	70	69	71
Russia	61	66	66	71	72	69	60	67	69	70	69	71	71	71	71
Germany	45	46	45	47	49	46	33	44	44	43	43	43	43	42	44
Others	360	385	380	399	414	395	310	365	386	373	371	346	337	335	369
Global	971	1,064	1,148	1,249	1,348	1,345	1,240	1,433	1,537	1,559	1,650	1,641	1,598	1,604	1,675

World crude steel production in 2017 was 1.675 billion mt, a 4.4% increase from 2016’s 1.604 billion mt. According to World Steel Association’s forecast, global steel demand will increase 。 1.8% to 1.6161 billion mt in 2018, and increase 0.7% to 1.6267 billion mt in 2019

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Data Source: World Steel Association

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2. 2003-2017 World Major Crude Steel Producers by Country (%)

	2003	2004	2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	2015	2016	2017
Mainland China	23%	26%	31%	34%	36%	38%	47%	45%	46%	47%	50%	50%	50%	50%	50%
Japan	11%	11%	10%	9%	9%	9%	7%	8%	7%	7%	7%	7%	7%	7%	6%
U.S.A	10%	9%	8%	8%	7%	7%	5%	6%	6%	6%	5%	5%	5%	5%	5%
India	3%	3%	4%	4%	4%	4%	5%	5%	5%	5%	5%	5%	6%	6%	6%
S.Korea	5%	5%	4%	4%	4%	4%	4%	4%	4%	4%	4%	4%	4%	4%	4%
Russia	6%	6%	6%	6%	5%	5%	5%	5%	4%	4%	4%	4%	4%	4%	4%
Germany	5%	4%	4%	4%	4%	3%	3%	3%	3%	3%	3%	3%	3%	3%	3%
Others	37%	36%	33%	32%	31%	29%	25%	25%	25%	24%	22%	21%	21%	21%	22%
Global	100%	100%	100%	100%	100%	100%	100%	100%	100%	100%	100%	100%	100%	100%	100%

World major crude steel producers: 1. China accounts for 50% of the world’s crude steel production, up from 23% in 2003. 2. India’s crude steel production has grown from 3% in 2003 to 6% in 2017, which is a country to be considered with great potential

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Data Source: World Steel Association

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3. 2010 - 2018 International Scrap & Iron Ore Price Trend

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、 Data Source: Xiben New Line Feng Hsin

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4. 2008~2018 Non-Ferrous Metal Price Trend

•Nickel

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Mar. 2008 around
USD3300MT
Feb. 2016 around
MAR. 2018
USD8000/MT
around
USD14000/MT
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Data Source: London Metal Exchange

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4. 2008~2018 Non- Ferrous Metal Price Trend

•Zn

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Feb. 2018 around
USD3600/MT
Mar. 2018 around
USD3000/MT
Dec. 2008 around
USD1100/MT
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Data Source: London Metal Exchange

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4. 2008~2018 Non- Ferrous Metal Price Trend

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China’s Effect on Global Steel Industry 1. 2010~2018 Mainland China Steel Product Export Statistic

Unit: million ton

	Jan	Feb.	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec	Monthly AVG	Compare to 2010
2010	289	249	333	430	494	562	455	280	301	286	291	285	355	100%
2011	312	248	491	477	476	429	444	419	421	382	420	372	408	115%
2012	373	339	503	467	523	522	432	424	515	484	513	485	465	131%
2013	492	424	528	555	541	529	515	614	492	507	500	537	520	146%
2014	677	480	676	754	807	707	806	776	852	855	972	1,017	782	220%
2015	1,029	780	770	854	920	889	971	973	1,125	902	961	1,066	937	264%
2016	974	811	998	908	942	1,094	1,030	901	880	770	812	780	908	256%
2017	742	575	756	649	698	681	696	652	514	498	535	567	630	178%
2018	465	485	565	647									541	152%

， Export quantity from JAN-APR 2018 totaled 21.624 million mt averaging 5.41 ， million mt/month a decrease of 20.1% from 2017.

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Data Source: Xiben New Line

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Jan-10
Apr-10
Jul-10
Oct-10
Jan-11
Apr-11
Jul-11
Oct-11
Jan-12
Apr-12
Jul-12
Oct-12
Jan-13
Apr-13
Jul-13
Oct-13
Jan-14
Apr-14
Jul-14
Oct-14
Jan-15
Apr-15
Jul-15
Oct-15
Jan-16
Apr-16
Jul-16
Oct-16
Jan-17
Apr-17
Jul-17
Oct-17
Jan-18
Apr-18
Data Source: Xiben New Line 0 200 400 600 800 1000 1200
mt 11.25
million
mt
Unit: million ton
6.47million
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2. 2010~2018 Mainland China Steel Product Export Trend
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3.China’s Steel Product Export Statistic

Item Product	2018 Jan〜Feb Average	2018 Jan〜Feb Average	2017 Monthly Ave.	2016 Monthly Ave.
	Quantity(MT)	Growth(%)	Quantity(MT)	Quantity(MT)
Raw Material	64,270	-66.3%	190,704	11,521
Semi-finished Product	425	-20.6%	535	1,084
Finished Product	4,715,485	-24.5%	6,244,310	9,040,253
Total	4,780,180	-25.7%	6,435,549	9,052,858

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4.China’s Steel Product Import Statistic

Item Product	2018 Jan〜Feb Average	2018 Jan〜Feb Average	2017 Monthly Ave.	2016 Monthly Ave.
	Quantity(MT)	Growth(%)	Quantity(MT)	Quantity(MT)
Raw Material	144,612	-26.8%	197,690	188,970
Semi-finished Product	135,006	232.6%	40,587	22,744
Finished Product	1,107,164	0.0%	1,107,158	1,100,766
Total	1,386,781	3.1%	1,345,435	1,312,480

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Taiwan Domestic Bar Product Snapshot 1.Taiwan Bar Product Import Statistic

Item Product	2018 Jan〜Mar Monthly Ave.	2018 Jan〜Mar Monthly Ave.	2018 Jan〜Mar Monthly Ave.	2017 Monthly Ave.	2017 Monthly Ave.	2016 Monthly Ave.	2016 Monthly Ave.
	Quantity(M T)	Growth	Price($/kg)	Quantity(MT)	Price($/kg)	Quantity(MT	)Price($/kg)
Scrap	239,374	8.7%	9.73	220,266	7.94	238,323	6.64
Billet	74,343	-6.4%	16.09	79,456	14.14	125,824	10.59
Rebar	216	56.5%	24.94	138	22.89	84	21.29
Merchant Bar	3,945	-3.0%	36.17	4,067	27.92	5,293	20.59
H-Beam	5,326	-25.5%	17.26	7,152	16.18	9,209	14.40
BIC(14mm↓)	35,710	-7.9%	19.04	38,770	17.30	39,593	13.82
BIC(14mm↑)	3,811	-5.5%	23.45	4,034	21.82	4,060	19.06
Round Bar	25,522	-4.2%	33.56	26,638	28.85	21,612	27.99

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2.Taiwan Bar Product Export Statistic

Item Product	2018 Jan〜Mar Monthly Ave.	2018 Jan〜Mar Monthly Ave.	2018 Jan〜Mar Monthly Ave.	2017 Monthly Ave.	2017 Monthly Ave.	2016 Monthly Ave.	2016 Monthly Ave.
	Quantity(MT)	**Growth **	Price($/kg)	Quantity(MT)	Price($/kg)	Quantity(MT)	Price($/kg)
Billet	23,645	19.6%	15.39	19,765	14.22	11,124	11.61
Rebar	31,850	123.3%	16.91	14,266	15.43	22,431	12.99
Merchant Bar	26,276	41.9%	17.87	18,522	17.13	16,782	15.47
H-Beam	23,441	78.8%	18.56	13,108	17.15	15,533	15.14
BIC(14mm↓)	13,247	-7.6%	22.62	14,341	21.31	13,560	18.23
BIC(14mm↑)	6,551	22.6%	20.85	5,344	19.96	5,314	17.38
Round Bar	15,612	12.3%	37.26	13,897	37.85	14,579	33.97

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3. Rebar Apparent Consumption Over the Past 10 Years

Thousand ton

3,000 3,500 4,000 4,500 5,000 5,500 6,000 6,500	4,498 3,896 4,988 5,661 5,730 5,794 6,060 5,621 4,692 4,709 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017	4,498 3,896 4,988 5,661 5,730 5,794 6,060 5,621 4,692 4,709 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017	4,498 3,896 4,988 5,661 5,730 5,794 6,060 5,621 4,692 4,709 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017	4,498 3,896 4,988 5,661 5,730 5,794 6,060 5,621 4,692 4,709 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017	4,498 3,896 4,988 5,661 5,730 5,794 6,060 5,621 4,692 4,709 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017	4,498 3,896 4,988 5,661 5,730 5,794 6,060 5,621 4,692 4,709 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Year		2008 2009 2010 2011 2012 2013 2014 2015			2016	2017
Production (A) Import (B) Export © Apparent Consumption (D=A+B-C)		4,865 4,312 5,126 5,843 5,779 5,870 6,162 5,772 8 2 4 3 3 2 5 1 375 418 142 185 53 78 107 151 4,498 3,896 4,988 5,661 5,730 5,794 6,060 5,621			4,960 1 269 4,692	4,879 2 171 4,709
Growth of Apparent Consumption%		BASE 87 111 126 127 129 135 125			104	105
Production Capacity(E)		7,542 8,260 8,600 9,066 9,066 9,066 9,066 9,066			9,066	9,066
(A)/(E) Self-Sufficiency % (A)/(D)		65 52 60 64 64 65 68 64 108 111 103 103 101 101 102 103			55 106	54 104
1.Data Source: TSIIA Website(Production、Delivey, Inventroy,Product tpye Import/Export date search)
2.Apperant Consumption is calculated byusing2008 figures as base.

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4.Construction Statistic – Taiwan Building Construction Permit Approval Statistic

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Data Source: Construction and Planning Agency, MOI , construction business metrics Unit:Case;Thousand Square Meter 年別 Year 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 件數 Case 22,454 25,268 34,453 45,934 43,802 35,124 31,667 19,474 20,516 29,696 33,161 31,669 32,991 31,994 27,643 22,511 25,035 總樓地板面積 Total Floor Area 21,700 23,042 28,882 42,497 43,200 36,474 34,700 26,161 19,915 31,174 34,148 32,883 39,760 38,635 32,596 26,235 29,884															Unit:Case;Thousand Square Meter	Unit:Case;Thousand Square Meter	Unit:Case;Thousand Square Meter	Unit:Case;Thousand Square Meter
	年別 Year	2001	2002	2003	2004	2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	2015	2016	2017
	件數 Case	22,454	25,268	34,453	45,934	43,802	35,124	31,667	19,474	20,516	29,696	33,161	31,669	32,991	31,994	27,643	22,511	25,035
	總樓地板面積 Total Floor Area	21,700	23,042	28,882	42,497	43,200	36,474	34,700	26,161	19,915	31,174	34,148	32,883	39,760	38,635	32,596	26,235	29,884

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5.Feng Hsin Domestic Rebar Market Share Statistic

Mt

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	104年 Quarterly average	105年 Quarterly average	106年 Quarterly average	104年Q4	105年Q1	105年Q2	105年Q3	105年Q4	106年Q1	106年Q2	106年Q3	106年Q4
FH Sales	163,485	147,451	149,008	179,075	126,886	153,670	138,854	170,394	153,419	150,501	135,979	156,132
Nation Sales	1,472,847	1,309,052	1,310,281	1,527,977	1,240,928	1,339,601	1,240,658	1,415,022	1,330,989	1,265,722	1,262,036	1,382,378
FH Market Share	11.1%	11.3%	11.4%	11.7%	10.2%	11.5%	11.2%	12.0%	11.5%	11.9%	10.8%	11.3%
P1 107Q1Feng Hsin Rebar Quarterly Avervage Sales 136,918MT

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Section 232 Overview

Overview

1.The United States begin imposing tariffs on imported Steel and Aluminum products of 25% and 10%, respectively form 2018/3/23 EST.

2.Steel products (Tax code 7206~7306) including Carbon Steel, Stainless Steel, Alloy Steel Billet, Hot Rolled, Cold Rolled, Galvanized, Rebar, Round Bars, BIC, Merchant Bars and Tubes.

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Exemptions of Section 232

1.Countries

a. Indefinitely Exemptions Korea, Argentina, Australia, Brazil (limitation and other conditions may apply) b. Temporary Exemptions Canada, Mexico, and EU

1. Individual Product Exemptions Any individual or corporation effected may apply for product exemptions.

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U.S. Steel Import Statistic by Country

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According to the U.S. import stats, total steel products import in 2016 was 33.319 million mt. Taiwan placed 8[th] with 1 million mt（3%）which was a 17.2% increase form 2015.

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Taiwan Export to U.S. effected Steel Products and Quantities

Product	Product	2015	2016	2017	%
Steel Plates		24,057	8,288	1,553	0.14%
HotRolled		3,369	181	445	0.04%
ColdRolled		20,924	73,647	90,254	7.90%
Galvanized		585,361	625,890	597,427	52.30%
Round Bars	Straight Bar+BIC	1,058	936	6,024	0.53%
	Rebar	36,420	124,551	12,099	1.06%
	Others	55	112	208	0.02%
Merchant Bars	H-Beam	39,232	23,819	17,722	1.55%
	Angle	8,822	7,273	4,477	0.39%
	Channel	796	661	581	0.05%
	Others	19,784	11,667	8,037	0.70%
Tube	Welded	109,880	92,338	247,151	21.63%
	Seamless	255	237	163	0.01%
Stainless Steel		121,929	126,895	141,481	12.38%
Alloy Steel		13,542	12,937	14,788	1.29%
Billet	Flat/Billet steel	19	3	3	0.00%
Total		985,503	1,109,435	1,142,413	100.00%

Data Source: Taiwan Steel Industry Association

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Taiwan Exports US Steel Statistics

Unit:	NTD Thousand / ton Standard Steel	NTD Thousand / ton Standard Steel	Special Steel	Special Steel	Others	Others	Sum	Sum
	Weight	Amount	Weight	Amount	Weight	Amount	Weight	Amount
2013	626,033	17,592,111	116,073	11,194,247	104	26,038	742,210	28,812,396
2014	1,034,423	28,140,715	143,908	16,049,753	133	66,652	1,178,464	44,257,120
2015	850,013	22,716,492	135,471	12,323,820	190	104,158	985,674	35,144,470
2016	969,615	22,516,656	139,832	11,322,120	69	90,747	1,109,516	33,929,523
2017	986,143	26,562,555	156,269	13,643,048	238	564,978	1,142,650	40,770,581

Data Source: Taiwan Steel Industry Association

Note：Others including Steel tablet、Billets、Bloom、Stainless Billets、Alloy Billets

The U.S. is the largest steel products export country for Taiwan, which accounts for 13.7% by quantity , and accounts for 21.1% by value .

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U.S. Export Accounts for Low Percentage of FH’s Export Market

Domestic/Export Percentage

Unit:NTD Thousand

			Unit:NTD Thousand	Unit:NTD Thousand
Domestic/Export	2017		2016
	Net Sales	%	Net Sales	%
Domestic	21,095,342	85%	18,213,976	87%
Export	3,646,595	15%	2,718,675	13%
Total	24,741,937	100%	20,932,651	100%

Export Countries Percentage

Unit:NTD Thousand

			Unit:NTD Thousand	Unit:NTD Thousand
Countries	2017		2016
	Net Sales	%	Net Sales	%
Australia	907,639	25%	745,853	27%
Singapore	455,249	12%	295,429	11%
Indonesia	453,683	12%	131,839	5%
Malaysia	378,262	10%	127,768	5%
Canada	394,267	11%	400,067	15%
U.S.	242,724	7%	340,952	13%
Others	814,771	23%	741,019	24%

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Feng Hsin Financial Analysis 1. Consolidated Balance Sheet

Unit: NTD Thousand

Date	2018.3.31	2018.3.31	2017.12.31	2017.12.31	2016.12.31	2016.12.31
Item	Amount	%	Amount	%	Amount	%
Current Assets	8,702,695	39.23%	7,743,516	37.46%	9,630,784	49.04%
Non-current Assets	3,212,818	14.48%	3,001,162	14.52%	2,107,790	10.73%
Property,Plant and Equipment	10,124,326	45.64%	8,845,656	42.79%	7,407,102	37.72%
Other Non-current Assets	142,482	0.64%	1,080,025	5.22%	491,508	2.50%
Total Assets	22,182,321	100.00%	20,670,359	100.00%	19,637,184	100.00%
Current Liabilities	3,580,344	16.14%	2,879,029	13.93%	2,866,499	14.60%
Long-term Liabilities		0.00%		0.00%		0.00%
Non-currentLiabilities	187,314	0.84%	185,034	0.90%	187,062	0.95%
Total Liabilities	3,767,658	16.98%	3,064,063	14.82%	3,053,561	15.55%
Capital Stock	5,815,994	26.22%	5,815,994	28.14%	5,815,994	29.62%
Additional Paid-in Capital	618,428	2.79%	448,351	2.17%	447,280	2.28%
Legal Reserve	3,591,351	16.19%	3,591,351	17.37%	3,409,772	17.36%
Special Reserve	98,711	0.44%	98,711	0.48%	56,150	0.29%
Retained Earnings,Unappropriated	8,614,487	38.83%	7,698,777	37.25%	6,953,138	35.41%
Retained Earnings	12,304,549	55.47%	11,388,839	55.10%	10,419,060	53.06%
Other Equities	(324,308)	-1.46%	(46,888)	-0.23%	(98,711)	-0.50%
Total Equities	18,414,663	83.02%	17,606,296	85.18%	16,583,623	84.45%
PE	31.66		30.27		28.51

Data Source: Feng Hsin

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2. Consolidated Income Statement

Unit: NTD Thousand

Item\Year	2012	2013	2014	2015	2016	2017
Gross Sales	34,199,656	29,899,588	30,171,468	23,380,189	20,932,650	24,741,937
Gross Profit	2,917,614	2,311,087	2,563,544	3,016,191	3,162,911	3,815,324
Operation Income	1,420,978	1,620,357	1,806,193	2,255,473	2,342,327	3,033,481
Non-operating Income& Expense	483,882	108,526	174,041	144,070	(145,347)	208,665
Income Before Income Tax	1,876,787	1,728,883	1,980,234	2,399,543	2,196,980	3,242,146
Net Income	1,619,486	1,446,331	1,668,131	2,003,635	1,815,794	2,724,957
Other Comprehensive Gains and Losses	-	13,108	(18,367)	(32,636)	(69,503)	41,444
Gains and Losses for the Period	1,619,486	1,459,440	1,649,764	1,970,999	1,746,291	2,766,401
Earnings per Share (NTD)after tax	2.78	2.49	2.87	3.45	3.12	4.69

Data Source: Feng Hsin

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3. Feng Hsin 2008 - 2017 Operating Profit

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40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
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Data Source: Feng Hsin

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4.Feng Hsin 2008–2017 E.P.S. And Dividend Trend

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5.00
4.69
4.59
4.50
4.06
4.00 Earning Per
Shaer
3.50
3.45
3.50 3.39
3.12
3.00 3.00 3.00
2.87 Cash Dividend
3.00 2.75 2.78
2.63
2.50 2.49 2.50 2.50
2.50
2.00 2.00
2.00
1.50
1.00
0.50
0.00
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Data Source: Feng Hsin
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5. Feng Hsin 2008 - 2017 Product Sales Percentage

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Sales(MT)	2016	2017
Domestic Rebar	595,055	596,112
Domestic Merchant Bar	426,227	419,497
Domestic Merchant Bar	424,115	403,367
Total	1,445,397	1,418,976

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Data Source: Feng Hsin

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6. Feng Hsin’s Scrap and Finished Product States

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Data Source: Feng Hsin P29

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7. Feng Hsin’s Scrap and Finished Product Price Difference States

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Data Source: Feng Hsin

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8.Sales Quantity and Sales (Ton/Million)

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450000 8000
400000 7500
350000
7000
300000
6500
250000
6000
200000
5500
150000
5000
100000
50000 4500
0 4000
105/Q1 105/Q2 105/Q3 105/Q4 106/Q1 106/Q2 106/Q3 106/Q4 107/Q1
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Data Source: Feng Hsin

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31

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9.2018 JAN~APR Operating Income & Pretax Profit Comparison

		Unit:NTD Thousand	Unit:NTD Thousand
	2018/1~4	2017/1~4	Growth%
Net Sales	9,364,130	8,278,684	13.11%
Cost of Sales	8,108,489	6,913,308	17.29%
Gross Profit	1,255,641	1,365,376	-8.04%
Operating Expense	272,189	258,898	5.13%
Operation Income	983,452	1,106,478	-11.12%
Non-operating Income	46,134	23,038	100.25%
Income from Continuing Operation Before Income Tax	1,029,586	1,129,516	-8.85%

Data Source: Feng Hsin

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Company Production, Marketing and Future Development Strategies

1.Production

• A. New product development to expand product offering, production flexibility to maximize customer needs.

• B. Addition of “Vacuum Degassing” equipment will increase product competitiveness to to expand product application.

• C. SBQ rolling mill equipment upgrade to add RSB (Reduce Sizing Block) and a new coil machine to increase product quality.

• D. New rebar mill with advanced low temp production technique can not only improve rebar quality but also reduce on carbon emission.

2.Sales

• A. Actively participating in public construction tender with a 12% rebar market share target. B. Keeping long term relationship and contracts with scrap suppliers to have stable supply and quality.

• C. Maintaining well-established relationship with distributors to provide better customer service to support steady sales and market share.

• D. To push SBQ product into higher application with newly upgraded melting equipment.

3.Future Development and Strategy

FH is not only aiming to finish all equipment upgrades also to continue

expand our product category and to increase our product added value to maximize company profit .

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4.Finished and future investments

1.Increase competitiveness.

Unit: 100 Million NTD

No.	Investment/Upgrade	Estimate/Actual Amount	Investment/Upgrade Reasons	Estimate/Actual Completion Date
1	No. 1 Melting Shop: CC upgrade	1.63	1.Give No.1 Melting shop the ability to produce SBQ Billets 2.Improve Merchant bar Quality 3.Improve Merchant bar mill hot Billet consumption rate	2014/09
2	No. 2 DC Furnace Converter Update	0.80	1.Update of 20 years old equipment to keep Available up . 2.Increase of 9.3% after upgrade.	2015/07
3	No. 2 Melting Shop: 1. LF (Ladle Furnace) relocation 2. VD (Vacuum Degassing) addition	4.80	1. New product development; Can produce entry level spring steel 2. Expand SBQ product end application. Current steel grades via VD can be used in: a. Automobile parts (after market) b. High grade fasteners c. high grade hand tools 3. Improve product quality, increase competitiveness internationally and domestically	LF Relocation- 2015/08 VD addition- 2015/12

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1.Increase competitiveness

Unit: 100 Million NTD

No.	Investment/Upgrade	Estimate/Actual Amount	Investment/Upgrade Reasons	Estimate/Actual Completion Date
4	No.2 meltins shop Cvane replacement .	1.80	1.Old Crane's collum need upgrade and replacement for safety issues . 2.Original capacity of 100t upgrade to 130t increase of satety measures .	2015/08
5	Billet Magnetic Particle Inspection (MPI) Equipment	0.64	1. To solve billet’s surface impurities that can’t be inspected and improve on polish technique 2. After MPI and surface polishing, greatly reduce product defective and claims, increase on product competitiveness.	2016/03
6	Merchant Bar Mill’s Rough and Medium Mill AC Motor	1.50	1. Rough and Medium Mill have a total of 12 AC motors, all have been in service for 19 years. All back up motors have had maintenance record, and the mill currently does not have any new back up motors. 2. To reduce both motor maintenance interval and cost.	2016/09
7	SBQ Mill’s RSB addition and New Coil Machine	8.21	To replace current equipment with new to increase competitiveness by improving surface and internal quality.	106/9

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1.Increase competitiveness.

1.Increase competitiveness.	1.Increase competitiveness.	1.Increase competitiveness.	1.Increase competitiveness.	1.Increase competitiveness.
Unit: 100 Million NTD
No.	Investment/Upgrade	Estimate/Actual Amount	Investment/Upgrade Reasons	Estimate/Actual Completion Date
1	New Rebar Mill	28.30	1. To expand on small size rebar market share 2. Direct rolling to save on gasoline usage 3. Low-temp rolling to reduce cost of alloy in high tensile rebar	2018/01
2	Merchant bar mill's Universal Block Upgrade	0.58	1.Improve on Channel Bars Quality . 2.Decrease on roller costs and save on time used when changing rolls .	2018/06

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2.Improvements on Air Pollution ,Waste Water and Carbon Emissions

Unit: 100 Million NTD

				No.		Investment/Upgrade				Estimate/Actual Amount Investment/Upgrade Reasons							Estimate/Actual Completion Date
				1	Heating Furnace LNG					1.95		1.Reduce air Pollution to follow future laws .						2017/12
					upgrade for		merchant					2.Save on Energy .
					bar and SBQ mills
							Pollutant		Emissions estimation after upgrades
							TSP Pollutant					Sox Pollutant		NOx	Pollutant		VOC Pollutant
							Emissions estimation					Emissions estimation		Emissions estimation			Emissions estimation
				Process			(ton/Year) environme				(ton/Year) environme			(ton/Year) environm			(ton/Year)
						type	ntal impact Instruction			Future changes		ntal impact Instructio Future changes		ental impact Instructio		Future changes	environment al impact Instructions			Future changes
							s					ns		ns
				Rebar mill's			16.06			3.84		74.57 4.44		62.11		55.68	11			0.72
				Merchant Bar mill’s			17.8			2.57		76.84 2.97		49.47		37.26	21.27			0.48
				SBQ mill's			9.05			3.59		111.57 4.16		83.19		52.12	26.29			0.67
						Sum	42.91			10		262.98 11.57		194.77		145.06	58.56			1.87
				Reduction difference			-32.91					-251.41		-49.71			-56.69
				Reduction rate- whole plant			19.10%					41.24%		9.48%			13.82%
		180			million NTD		out of Total			New rebar Mill investment is account for waste water processing,
		which will reduce water usage with zero waste water as future goal														.
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3.Others

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Thank You

for Your Attention

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