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FPC — Annual Report 2020
Aug 3, 2021
51762_rns_2021-08-03_9d4ef431-e6b5-4589-a4b4-414c399f8e73.pdf
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Formosa Plastics Corporation 2020 Business Report
1. 2020 Business Report:
The Company (Formosa Plastics Corporation) generated consolidated sales of NTD 185.81bn in 2020, reaching 89% of its target of NTD 208.06bn and was down 11% from NTD 207.84bn generated in 2019. Consolidated pre-tax profit came in at NTD 24.16bn in 2020, reaching 76% of its target of NTD 31.76bn and declined by 43% from NTD 42.21bn generated in 2019.
Due to the worldwide COVID-19 pandemic, countries locked down since March 2020 resulted in a sharp demand decline and supply disruptions. Production activities, consumptions, and global economy were hit hard and dragged down crude oil, ethylene, propylene, and petrochemical product prices. Especially, WTI crude oil futures prices even fell to a negative value on April 20, 2020. Although the Company's product prices declined in 1H20 to narrow down the margins, the sharply falling feedstock prices still made the Company profit for its core business. However, it still reported a net loss on a consolidated basis as dragged by the decline in investment incomes from Formosa Petrochemical Corp. and Formosa Plastics Corp., USA in 1H20. Nevertheless, in 2H20, given the easing of lockdown, demand for work-from-home related products, anti-epidemic products, home gym equipment, building materials, 3C, and home appliances have been surging. Given the gradual recovery of global economy as well as the roll out of monetary easing measures and fiscal stimulus policies by countries, the prices of petrochemical products have rebounded strongly and returned to the levels of the end of 2020 before COVID-19. Among them, polyvinyl chloride (PVC) and polyethylene vinyl acetate (EVA) prices reached the record high in the latest 9 year, which made the Company turn profitable in 2020.
Even though sales volume of polyethylene (PE) increased by 329K tons in 2020 from 2019 thanks to the contribution from the new HDPE plant built by 100% owned subsidiary, Formosa Industries Corp. with selling its products under full production in 2020, the Company’s
operating profit of NTD 17.09bn still dropped by 15% in 2020 from 2019 due to the ASP decline with 12-38% and narrowing product margins. In addition, the total cash dividends of NTD 3.35bn in 2020 from investees including Nanya Plastics Corp., Formosa Chemicals & Fibre Corp. and Nanya Technology Corp., etc. deceased by NTD 4.82bn from 2019. Also equity investment incomes of NTD 5.21bn from investees including Formosa Petrochemical Corp., FPC-USA and Formosa Sumco Technology Corp., etc. significantly lower NTD 9.52bn from 2019. The decrease in 2020 led to a 43% decline of the Company’s pre-tax profit from 2019.
Looking back at 2020, the confrontation between China and the US had spread from trade war to technology war and financial war. Moreover, the supply disruptions impacted by COVID-19 led to the decline in economy growth for many countries. Except for China, of which the economy could still maintain positive growth due to better control of COVID-19, the economy of other developed counties were declining.
While the world is under the shadow of COVID-19, Taiwan has been the top performer in term of GDP growth among the Four Asian Tigers for 2 consecutive years as benefiting from 1) the homecoming capital, 2) order reallocation, 3) strong demand rebound after the easing of lockdown, and 4) better control of COVID-19. Both export value and domestic investment showed positive growth in 2020. However, the China-US trade war, which has lasted for more than 2 years, caused the change for international division of labor between Taiwan, China and US. The COVID-19 also accelerated the anti-globalization trend, which put Taiwanese companies located in China and ASEAN countries at risks on supply chain issue.
In addition, the Regional Comprehensive Economic Partnership Agreement (RCEP) was signed on November 15, 2020. It will be not only the world's largest free trade zone, but also bring a huge boost to the economic and trade integration for Eastern Asia and reshape the global economy and trade. However, due to political issues, Taiwan is absent from the two major free trade zones, RCEP and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which becomes a missing corner of the regional economic and trade integration
picture. In the short term, RCEP’s impact to Taiwan is not too significant with low deduction of tariffs rate, long preferential period and exempt from tariffs about 70% of Taiwan’s exports to the ASEAN region. However, in the long term, it may not only result in a rising concentration rate for semiconductor and electronics industries which is not good for Taiwan’s export structure, but also the growing tariff pressure for the homecoming Taiwanese companies. If Taiwan is not able to actively seek for solutions on the breakthrough for the obstacle on trade tariff, in the long run, it will not only harm Taiwan’s international trade, but also the economic growth momentum. Moreover, it will create hurdles on the development of relationships with regional trade partners.
Furthermore, in order to build green energy and connect with the international trend, in accordance with the newly revised Renewable Energy Development Act, which requires the major users to bear a 10% obligation on renewable energy including the investment on green energy equipment and cash payment, etc. However, Taiwan’s power grid is independent, and the power generated by renewable energy is still unstable. Moreover, there are transportation and storage problems for natural gas. It is difficult to undertake the energy transformation policy of "replacing nuclear power with green energy; replacing coal-based power plant with natural gas-based power plant." This triggered producers concern about a stable electricity supply going forward. Furthermore, the society has been long brimming with the ideology of environmental protection and unreasonable EPA review system is along with the stringent environmental regulations, which has hindered many investment projects and is adverse effect on the long-term development of Taiwan’s industry and economy.
At the critical moment in developing Taiwan’s industry and economy during US-China trade war and COVID-19, the governments should roll out a fiscal tax policy with investment incentives, amend the irrational environmental assessment process, loosen the environmental regulation restrictions and revisit the energy transformation policy to formulate reasonable energy generation allocation. In the meantime, government should improve regulations to be in-line with international standards, and
continue to participate in regional economic and trade integration with key trading partners to make up for Taiwan’s lacking of connection among international trade, and allow the industry to enjoy a fair competition environment with regional peers. By improving the investment environment and joining regional economic and trade integration to strengthen economic and industry competiveness, the government can create a friendly and sustainable investment environment.
In view of the impact from COVID-19 globally and the difficulty in an oversupplied market under the supply addition wave, the Company has been proactively engaging in the development of artificial intelligence (AI) technology, and established an AI research and development center in Renwu Complex, combining AI professionals from various departments to enhance operational efficiency in five aspects "optimization of production and sales, quality assurance, intelligent maintenance, digital inspection, and cost reduction". In 2020, 75 out of 148 AI projects have been completed with an estimated annual benefit of NTD 290m, while the remaining 73 projects are still ongoing.
Aside from this, in an effort to strengthen the AI technology capability, the Company continues providing systematic training courses to employees, interacting with companies and academic institutions outside the Company, inviting domestic and foreign experts for speeches, building platforms to hold competitions, etc. In view of the rapid development of AI technology, in addition to continuing to select outstanding talents to train in Taiwan's AI schools, starting from 2020, the Company entrusted Taiwan's AI schools and Taiwan’s top universities to cooperate with experts and various academic institutions to organize advanced AI courses to cultivate more high-end AI talents in order to build a solid foundation for digital transformation, of which, 44 talents have completed the training.
Besides, during COVID-19 period, the Company fully supported the "National Mask Team" on raw materials for medical protection and hygiene products, in order to contribute to Taiwan's efforts in the prevention from the spread of COVID-19 and to ensure the citizens health.
Meanwhile, to secure the supply of raw materials for the non-woven fabric for the mask industry, the Company applied blockchain technology to build a non-woven fabric integrated marketing platform. The application is also expanded into supply chains in medical, automotive, shoe materials and wind power industries to connect upstream, midstream and downstream supply chains for the formation of global industry alliance to provide customers with a full range of services.
Furthermore, in order to achieve the goal of customer-oriented digital transformation and the optimization in selling and production to improve the service quality, the Company set up “FPC E-commerce Platform” which combined the Enterprise Resource Planning (ERP) information and AI technology and has been worked online. In addition, in order to continue to serve customers, the Company conducted multi methods to promote business by remote marketing to create a win-win situation during COVID-19 period.
Moreover, to pursue a reasonable profitability, strengthen business and reduce the negative impact from COVID-19, the Company implemented the improvement measures including circular economy development, project improvements promotion, the consumption of water, energy, and the utility usage volume per unit reduction. The Company accomplished 1,121 projects in 2020 with an annual benefit of NTD 850m.
At the same time, 13 office buildings, including the 2 founders' offices in the Kaohsiung plant, the birthplace of Formosa Plastics Group, were registered as monument by the Kaohsiung City Government. The “Y.C. Wang and Y.T. Wang Brothers Park” will be established in the 2.5 hectares original site. The restoration and reuse plans were reviewed and approved by the Kaohsiung City Government in January 2021.The park is expected to be completed by the end of 2023 and will be opened to public.
The Company and its China Ningbo and United States subsidiaries mainly produce plastics and chemical fiber raw materials. In 1H2020, sales volume of PVC decreased sharply due to COVID-19 given worldwide lockdown, but PVC price continued to raise from 2H20 because of demand for COVID-19 prevention in China, Vietnam, India, Europe and the United
States, automobiles, and construction markets recovery and force majeure of many Europe and US peers. However, due to global shipping and container shortages, total PVC sales volume in 2020 declined by 3% to 1,640K tons from 2019. Sales volume of caustic soda was 1,351K tons in 2020, decreased by 10% from 2019 given the declining downstream demand in alumina, textiles and pulp. Moreover, the price of caustic soda decreased because caustic soda plants raised their utilization rates to increase supply based on a better profit of PVC. In consideration of the unfavorable prices, the Company has conducted an off-peak production strategy and to export based on contract prices.
HDPE was in oversupply situation given a continued capacity expansion globally, while demand was lower in 2020 than 2019 impacted by COVID-19. However, the Company actively increased the selling of the differentiated products such as COVID-19 prevention related fabric grade and bottle blowing grade products, as well as pipe grade and bottle cap grade HDPE, along with the start of the new HDPE plant by the Company’s US subsidiary. The Company’s HDPE sales volume in 2020 increased by 2% to 524K tons from 2019. The Company’s EVA sales volume in 2020 increased by 2% to 290K tons from 2019 given the growth in solar packaging filming demand in China and no new capacity from peers. In addition, despite a high competition in the LLDPE market given new capacity from global peers and demand impact from COVID-19, the Company’s LLDPE sales volume in 2020 increased by 150% to 528K tons from 2019, given the aggressive expansion into Vietnam market, promotion of the injection grade and rotation molding grade differentiated products, and the conversion of LLDPE from the US subsidiary’s HDPE plant.
Due to a slump in crude oil price and the outbreak of COVID-19 at the beginning of 2020, the lockdown worldwide resulted in the lack of raw materials and labor shortages in the upstream, as well as the declined demand for tapes, coatings and resins in the downstream. Despite the shutdown of Linyuan plant’s first phase AA production, the Company’s AE sales volume in 2020 increased by 6% to 527k tons from 2019, given
demand recovery in 2H20 and the unexpected shutdown from peers. The Company’s sales volume of NBA is mainly for captive use by AE plants. The Company’s NBA sales volume in 2020 increased by 9% to 241K tons from 2019 given strengthening the bonded customers in Eastern China and also active expansion to Eastern China, Southern China and South Korea. Despite oversupply and a severe pricing competition in SAP market, the Company’s SAP sales volume in 2020 increased by 9% to 185k from 2019 given stable orders from contract customers and actively developing new customers.
The Company’s PP sales volume in 2020 increased by 5% to 977K tons from 2019 given full production and selling after the scheduled maintenance of Linyuan PP plant and the renewal of the granulator in 2019. The Company’s AN sales volume in 2020 decreased by 9% to 253K tons from 2019 due to a weak market demand impacted by COVID-19. The Company’s MMA sales volume of 82K tons in 2020 was similar to 2019 due to the recovery of the PMMA light guide plate and the strong demand for anti-COVID-19 plates. The Company’s ECH sales volume in 2020 increased by 3% to 97K tons from 2019, which was benefited from the booming development of the wind energy and 5G industries, and the stronger demand from downstream epoxy products.
In terms of capacity expansion, in order to strengthen the competitiveness, the Company aggressively expanded its capacities and conducted debottleneck projects, including the completed debottleneck project of PVC plant in Linyuan in 2020 with new capacities by 50K tons to 1,315K tons per annum, and the ongoing debottleneck project of PVC plant in Renwu, Linyaun and Mailiao with new capacities by 100K tons to 1,415K tons per annum by 2022. In addition, in response to the construction of the IPA plant for the joint venture "Formosa Tokuyama Advanced Chemicals Co., Ltd.", the first phase of the acrylic acid (AA) equipment in Linyuan AE plant with an annual capacity of 21K tons was dismantled in August 2020. As a result, the annual capacity of AA reduced to 147K tons and AE lowered from 268K tons to 250K tons.
In Ningbo Complex, the SAP plant debottleneck project of 10K ton
completed in 2020 and the annual capacity increased to 100K tons. The new PDH plant with annual capacity of 600K tons propylene is expected to complete and commence production in 3Q21. The EVA debottleneck project of 28K is expected to complete its construction and commence production in 1Q23 and the annual capacity increased to 100K tons.
Furthermore, in Kaohsiung, the Company’s storage tank in Qianzhen District will be moved to the Phase II intercontinental petrochemical zone. The Company has rent the land and dock from Port of Kaohsiung Taiwan International Ports Corporation for petrochemical usage and will build 12 storage tanks and 1 salt warehouse, which are expected to be completed in 1Q22.
In terms of equity investments, FPC-USA (22.66% owned by the Company) generated pre-tax loss of USD200m in 2020, decline from 2019, mainly due to the U.S. economy impacted by COVID-19 and 14 plants under maintenance shutdown and equipment inspections leading to significant losses. However, as benefiting from the US CARES tax reform bill which returns the tax expenses incurred in the past five year if a company reported net loss in 2020, FPC-USA’s net profit after tax was USD100million in 2020. Looking into 2021, it is expected that the successful development and roll-out of vaccines could help the US economy to resume growth, and to boost the demand for petrochemical products and the increase in product prices. Moreover, there will be only the second olefin plant (OL-2) and specialty PVC plant needed to conduct equipment inspections, and the new LDPE plant in Texas, US put into operation since November 2020, which will increase total sales volume and resume stable profit growth.
In addition, the loss of Fujian Fuxin Special Steel Co., Ltd. (29.16% owned by the Company) in 2020 further expanded from 2019 due to (1) the slowdown in economic growth in China with shrinking demand affected by COVID-19, and (2) market oversupplied due to pricing competition from Indonesia peers that led to poor ASPs in finished goods. In 2021, Fujian Fuxin expects to benefit from order shift effect after the resumption of work in China, a sustained economic growth, new
infrastructure projects and RCEP, etc., which will support a substantial growth in downstream exports demand for home appliances and metal products. In addition, Fujian Fuxin expects to decrease the loss as Fujian Fuxin will adjust the sales area, expand the sales in super ferritic stainless steel differentiated products, optimize production process and lower cost, and increase the hot rolling OEM for Formosa Ha Tinh Steel Corporation. In order to enlarge the synergy of vertical integration and enhance the competitiveness, Fujian Fuxin is conducting the new cold rolling mill plant project with 300K tpa capacity, and expects the plant to commerce production from 3Q21.
Besides, the Company has invested in Minima Technology Co. Ltd. in 2019 with a 19.07% of shareholding. It mainly produces disposable consumer products such as tableware, paper cups, straws and other decomposable plastic products. However, Minima Technology Co. Ltd. reported the loss in 2020 with severely declined demand in Europe and the US market impacted by COVID-19. Its new capacity in Huwei plant in Central Taiwan Science Park commenced production in 4Q20, which increased the overall annual capacity of decomposable compound rubber particles to 20K tons from 4K tons annually. In 2021, it is expected to turn profitable supported by the rising trend of plastics restriction globally, demand recovery from COVID-19, and the increase in capacity.
In view of the demand in advanced nodes from Taiwan’s semiconductor industry, the Company and Japan’s Tokuyama Co., Ltd. established a joint venture " Formosa Tokuyama Advanced Chemicals Co., Ltd." with 50% share respectively in October 2020. The new capacity will produce a 30K tons of electronic-grade IPA annually to meet domestic demand from semiconductor industry. The capacity is scheduled to be completed and put into production in the 3Q21.
In terms of research and development, the Company spent NTD 2bn on R&D in 2020, accounted for 1% of the Company’s revenues. These R&D expenses were mainly spent on new formulation development, production process improvement, product quality upgrade, energy consumption saving, and human resources cultivation to increase
production capacity and lower cost. In 2020, the Company completed 40 R&D projects with an annual benefit of NTD 90m. Meanwhile, the Company conducted R&D on industrial production technique and to commercialize specialty products including High temperature resistant and high mechanical strength chlorinated PVC, 5G wire and cable foam grade HDPE, HDPE cap & closure grade, LLDPE fiber grade, white color EVA encapsulate film grade, super high retention capacity SAP for sanitary napkins and baby diapers, medium modulus carbon fiber by DJWS process, carbon fiber for vinyl ester (VE) resin, carbon fiber for polyether ether ketone(PEEK), pultrusion process for carbon fiber reinforced polymer (CFRP), reactor-grade meltblown PP and low-energy consumption and high toughness EPP foam material, which has achieved good results.
Besides, the Company was awarded the “R&D 100 Awards” in 2020 for the technology of the "application of dye-sensitized battery for smart home", which cooperated with the Industrial Technology Research Institute. This demonstrates the Company's innovation capabilities in R&D and commercialization.
In order to enhance the competitiveness, the Company actively invested in the key technology development and applied for both domestic and international patent. In 2020, the Company received approval on 22 patents, and had a total of 182 effective patents as of the end of 2020. Meanwhile, the Company will continue to work with both domestic and international industry experts and academic area, to strengthen academic fundamentals and R&D to apply to the design for production capacity expansion and shortening the time of production process shift. The Company also set up a new high-end equipment center in Mailiao, and combined with virtual laboratory and talents in production process simulation, to accelerate the development of scratch resistance, flame resistance, toughness, gas barrier, dielectric products, as well as natural antibacterial and beauty-related green products.
Among them, the "Capture and Reuse of Flue Gas ", which was a joint project with academic research institutions, was qualified to receive the subsidy from “the A+ Industrial Innovative R&D Program” by
Ministry of Economic Affairs in January 2019. It is scheduled to complete the construction and operation in Renwu plant in 2H21. At the same time, in order to support the development in 5G industry in Taiwan, the Company will cooperate with Industrial Technology Research Institute and downstream companies to form a 5G raw material alliance, and expand its R&D towards products such as 5G and 6G base station housings, radomes and high-frequency network communication wires.
On the operational safety and environmental protection front, the Company always put emphasis on industry developments and environmental protection equally. As of the end of 2020, the accumulated investments on operational safety, environmental protection, and firefighting reached NTD 25.4bn, which was mainly spent on controlling pollution, energy saving, waste and greenhouse gases reduction, and operational safety and firefighting improvement. The Company’s pollution treatment and emissions are better than national regulatory standards.
In 2020, there were 4 business units praised by competent authority. Among them, Mailiao LLDPE, AN and ECH plants were all praised by Yunlin County for strong performance on occupational safety and health. Among them, the LLDPE and AN plants even received the “Occupational Safety 5-Star Award” from Yunlin County given the three consecutive years of praise awarded. Besides, Mailiao Complex was praised by Ministry of Labor for strong performance.
In terms of water and energy conservation and greenhouse emissions reduction, in 2020, the Company accomplished 973 improvement projects. Total water saved amounted to 5,351 tons/day, while greenhouse gas emissions reduction reached 179K tons/year. Other ongoing 930 improvement projects would further conserve water by 5,593 tons/day and reduce greenhouse gas emissions by 228K tons/year. According to the results announced by Carbon Disclosure Project (CDP) in 2020, the Company was ranked “A” in climate change assessment and “A-” in water resources assessment. Both achievements were among the top rankings within many well-known international chemical companies, which shows that the Company’s efforts in energy-saving, emission-reduction and
circular economy in response to climate change have achieved considerable results.
Besides, in order to enhance operational safety, the Company moved factory manager and section chief’s office to the side of production process control room, in order to response immediately to any production abnormalities. The Company also installed interlock and foolproof devices to avoid operational errors by operators. In addition, the Company set up a Standard Operating Procedures (SOP) platform for operators to familiarize themselves with the operation procedures to reduce errors, and an augmented reality (AR) interactive technology will be further introduced to help improve the effectiveness of the SOP platform. In the meantime, other than using AI and other technologies to assist construction safety, develop smart wearable devices and assist inspections and maintenance, the Company also introduced AI smart detection system for pipeline leakage at Renwu Complex by using 360-degree high-altitude cameras to monitor key production process areas to effectively detect the location of pipeline leaks and protect the safety of employee and equipment.
In view of the international ESG (Environmental, Social and Corporate Governance) and the domestic severe environmental regulations trend, the Company continues to improve the elimination of white smoke from the chimneys of Renwu Complex and to promote zero discharge of wastewater in each Complex. At the same time, each plant is reducing volatile organic compounds (VOCs) and streamlining equipment components to gradually replace the low-leakage equipment components. This is also supplemented by the application of infrared detector (GasFinder) to strengthen autonomous inspections for a friendly environment.
2. Business Performance:
The consolidated revenue in 2020 was NTD 185.8bn, a decrease of NTD 22.03bn from NTD 207.84bn in 2019. Operating profit was NTD 17.09bn with a 9% of operating margin after deducting COGS of NTD 156.75bn and operating expenses of NTD 11.95bn. Plus non-operating
income of NTD 7.06bn (included equity investment income of NTD 5.21bn), the pre-tax profit was NTD 24.16bn in 2020, decrease 43% from 2019.
3. 2021 Business Performance Target and Outlook:
Looking into 2021, the global economic activities is expected return to normal with the gradual normalization of COVID-19 prevention measures by countries, the optimistic expectation of effectiveness of vaccines and the support of large-scale fiscal and monetary easing policies by major economies. According to the latest forecast by the Monetary Fund (IMF), the global economy will recover quickly with ease of COVID-19.
However, the spread of the new variant COVID-19 virus at the beginning of 2021 led to a more severely global pandemic. The resumption of COVID-19 control measures, the shortage of vaccines and the delayed delivery schedules will affect the popularity of vaccination, which may weaken the rebound of economy growth. Besides, the uncertainties from the follow-up of China-US trade tension, whether countries to continue to adopt fiscal stimulus and monetary easing policies, the timetable for the re-lockdown by countries, and the rising geopolitical situation are still need to be closely monitored in the future.
In terms of supply, IHS forecasts that the global ethylene capacity will increase around 11.19 million tons in 2021, and the new capacity from China, Korea, and US will increase by 8.77 million tons. In terms of demand, based on the global ethylene demand growth of 0.6x of GDP growth, incremental demand should only be 5.1million tons in 2021. While polypropylene net capacity increase will be 8.33 million tons in 2021, mainly in China, by 6.13 million tons. Based on 1x of GDP growth, the incremental polypropylene demand should only be 5.7million tons in 2021. The global ethylene and propylene market will be oversupplied.
Furthermore, after the last upcycle of petrochemical industry during 2015-2019, a large number of incoming new capacities of ethylene, propylene and downstream derivatives in China and the US will result in
market oversupply, while decreased demand has been largely impacted by COVID-19 in 2020. Looking into 2021, although demand might not be able to fully return to pre-pandemic level before COVID-19 is fully controlled, the roll-out of vaccines and forecast from international agencies generally indicated a slow recovery of global economy growth. Moreover, many of the capacity expansion plans in global petrochemical peers suspended or delayed due to COVID-19, which will help alleviate the pressure of oversupply. Therefore, it is expected that the petrochemical market in 2021 will be better than 2020.
Based on a better control of pandemic in China and some overseas supply chains impacted by COVID-19, some orders have been shifted to China, and it is expected that downstream product exports will increase. Additionally, the "14th Five-Year Plan" from 2021 to 2025 will focus on "the building of a new development pattern with domestic and international dual cycles as the main body" to support a steady recovery of economic growth, and expand investments in traditional infrastructure, AI, 5G, big data, etc. The 2021 GDP growth in China is expected to be faster than other major economies in the world, which will help to increase the Company’s sales.
In the new year, given the uncertainties of COVID-19 and the continued capacity expansion from China and US, the Company still has pressures for its business operation. In response, the Company will deepen its applications and R&D in AI. In addition to actively cultivating AI, big data, and cloud computing talents, accelerating the application of AI in various fields, optimizing production and sales, improving product quality and management performance, lowering energy consumption to reduce costs, conducting pipeline inspections and leak detection, and strengthening the management of operational safety, the Company will continue to develop the R&D for forward-looking and high value-added products and production process in response to the trend of the development of semiconductor, 5G, renewable energy and medical and epidemic prevention industries. In the meantime, the Company moves towards the trend in refinization of products to strengthen long-term
competitiveness.
Moreover, there will be fewer days of maintenance shutdown for ethylene capacity in Taiwan in 2021 than 2020. The Company expects that the supply of ethylene and propylene feedstock will increase, and will seek for imports to cover the shortfall in raw material, aiming to reach the target of “full production and sales”. Meanwhile, the Company will conduct deep-dive review on petrochemical plant management, and to continue to promote a comprehensive inspection on equipment and the implementation of SOP, in order to manufacture under zero accidents. Besides, in response to the regionalization trend of the supply chain caused by COVID-19, the Company will not only continue to expand differentiated product markets, but also will integrate its past experience and fundamentals on automation and digitalization to accelerate digital transformation by using AI technology to optimize production and sales, and through remote marketing to overcome restrictions of traditional marketing method, which will help to actively expand into new customers and new markets in response to the drastic changing business environment.
In addition, as taking the sustainable development of industry and environment into account, the Company will build renewable energy capacity, continue to promote circular economy, energy saving and carbon reduction in order to fulfill corporate social responsibilities for a friendly environment. The Company also will aggressively promote the capacity expansion and debottleneck projects in Taiwan and overseas. Through the efforts above, the Company expects to strengthen its business, reverse the business downturn and to make the breakthrough of the challenges and maintain a steady performance.
Chairman: Jason Lin President: Jason Lin In-charge Accountant: Chia-Tse Chang
Formosa Plastics Corporation
Audit Committee’ Review Report
The Board of Directors has prepared the Company’s 2020 Business Report, Financial Statements, including Consolidated and Individual Financial Statement, and Proposal for Profits Distribution. The CPA firm of KPMG was retained to audit Formosa Plastics Corporation’s Financial Statements and has issued an audit report relating to Financial Statements. The Business Report, Financial Statements, and Proposal for Profits Distribution have been reviewed and determined to be correct and accurate by the Audit Committee members of Formosa Plastics Corporation. According to the Securities and Exchange Act and the Company Act, we hereby submit this report. Please be advised accordingly.
Formosa Plastics Corporation Chairman of the Audit Committee: Chi-Lin, Wei
March 17, 2021
Ratification Items Proposal 1
Proposal: For approval of the 2020 Business Report and Financial Statements as required by the Company Act.
Proposed by the Board of Directors
Explanation:
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1.The preparation of the Company’s 2020 Consolidated and Individual Financial Statements were completed. The aforementioned Financial Statement were reviewed by the Audit Committee and approved by the Board Meeting on March 17, 2021, and audited by independent auditors, Mr. Astor Kou and Mr. Winston Yu, of KPMG. The aforesaid Financial Statements together with the Business Report were reviewed by the Audit Committee, which the Audit Committee’ Review Report is presented.
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2.For the aforementioned Business Report, please refer to page 6 through page 20 of the Meeting Handbook. As for the Financial Statements, please refer to page 41 through page 48 of the Handbook. Please approve the Business Report and the Financial Statements.
Resolution:
Ratification Items Proposal 2
Proposal: For approval of the proposal for distribution of 2020 Profits as required by the Company Act.
Proposed by the Board of Directors
Attachment:
Please refer to page 49 of the Handbook for the Statement of Profits Distribution, which has been reviewed by the Audit Committee members of Formosa Plastics Corporation and approved by the Board of Directors on March 17, 2021.
Resolution:
Discussion Items (I) Proposal 1
Proposal: Amendment to the Rules for Election of Directors of the Company. Please discuss and resolve.
Proposed by the Board of Directors Explanation: To refer to the sample template announced in the order Tai-Cheng-Chih-Li-Zi No. 1090009468 dated June 3, 2020 by the Taiwan Stock Exchange Corporation, certain articles of the Rules for Election of Directors provided by the Company have been amended. The comparison table for articles before and after amendment is hereby attached. Please determine whether the amendments are reasonable.
| Article | Current Article |
Amended Article | Reason for Amendment |
|---|---|---|---|
| Article 5 |
(above 3 paragraph omitted) When providing a recommended slate of director candidates, a shareholder or the Board of Directors shallinclude in the documentation attached theretoeach nominee's name, educational background, work experience, a written undertaking indicating the nominee's consent to serve as a director if elected as such, a written statement that none of the circumstances in Article 30 of the Company Act exists, and other relevant documentary proof. |
(above 3 paragraph omitted) When providing a recommended slate of director candidates, a shareholder or the Board of Directors shall describeeach nominee's name, educational background, andwork experience. |
Amended in accordance with Article 192-1 of the Company Act. |
| The Board of Directors, or other person having the authority to call a shareholders' meeting, shall review the qualifications of each director nominee;except under any of the following circumstances, all qualified nominees shall be included in the slate of director candidates: 1. Where the nominating shareholder submits the nomination at a time not within the published period for receiving nominations. 2. Where the shareholding of the nominating shareholder is less than one percent at the time of book closure by the Company under Article 165, paragraph 2 or 3 of the Company Act. 3. Where the number of nominees exceeds the number of directors to be elected. 4.Where the relevant documentary proof required under the |
The Board of Directors, or other person having the authority to call a shareholders' meeting, except under any of the following circumstances, shall include all qualified |
The Board of Directors, or other person having the authority to call a shareholders' meeting, except under any of the following circumstances, shall include all qualified |
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|---|---|---|---|---|
nominees in the slate of director candidates: 1. Where the nominating shareholder submits the nomination at a time not within the published period for receiving nominations. 2. Where the shareholding of the nominating shareholder is less than one percent at the time of book closure by the Company under Article 165, paragraph 2 or 3 of the Company Act. 3. Where the number of nominees exceeds the number of directors to be elected. 4.Where the nominating shareholder fails to describe the nominee's |
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1. 2. 3. 4. |
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| preceding paragraph is not attached. |
name, educational background, and work experience. |
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|---|---|---|---|---|---|
| Article 6 |
The Board of Directors shall prepare ballots and distribute one ballot per voter corresponding to his/her attendance card number. The numbers of ballots distributed to the voters shall be equal to the directors to be elected. As for the number of voting rights associated with each ballot shall be specified on the ballots. |
The Board of Directors or other person having the authority to call a shareholders'meeting shall prepare ballots and distribute one ballot per voter corresponding to his/her attendance card number. The numbers of ballots distributed to the voters shall be equal to the directors to be elected. As for the number of voting rights associated with each ballot shall be specified on the ballots. |
The Company Act amendment stipulates a shareholders' meeting need not be convened by the Board of Directors. Therefore, ballots may be prepared by other person having the authority to call a shareholders' meeting. |
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| Article 7 |
If a candidate is a shareholder,a voter must fillthe candidate's accountnameand shareholder account numberin the "candidate" column of the ballot; If a candidate is a non-shareholder, the voter shall fill the candidate's full name and identity card number. |
A voter must fill the directorcandidate's full name in the "candidate" column of the ballot based on the director candidate list. |
Because the Company adopts the candidates nomination system, the Rules for Election of Directors of the Company is amended. |
| Article 8 |
A ballot shall be deemed void under the following conditions: 1.The ballot was not prepared as Article 6 stated; or 2.The ballot has more than one candidate’s name filled; or 3.Other words or marks are filled in addition to the information Article 7 stated; or 4.A ballot was not filled, or not completely filled, in compliance with the requirement set forth in Article 7; or 5.The writing is unclear and indecipherable; or 6.The candidate whose name is filled in the ballot is a shareholder, but the candidate's account name and shareholder account number do not conform with those given in the shareholder register, or the candidate whose name is filled in the ballot is a non-shareholder, and a cross-check shows that |
A ballot shall be deemed void under the following conditions: 1.The ballot was not prepared as Article 6 stated; or 2.The ballot has more than one candidate’s name filled; or 3.Other words or marks are filled in addition to the information Article 7 stated; or 4.A ballot was not filled, or not completely filled, in compliance with the requirement set forth in Article 7; or 5.The writing is unclear and indecipherable; or 6.The candidate whose name is filled in the ballot is a shareholder, but the candidate's account name and shareholder account number do not conform with those given in the shareholder register, or the candidate whose name is filled in the ballot is a non-shareholder, and a cross-check shows that |
A ballot shall be deemed void under the following conditions: 1. The ballot was not prepared as Article 6 stated; or 2. The ballot has more than one candidate’s name filled; or. 3. Other words or marks are filled in addition to the information Article 7 stated; or 4. The candidate’s full name filled in the ballot does not conform to the director candidate list after verification; or 5. The writing is unclear and indecipherable. |
A ballot shall be deemed void under the following conditions: 1. The ballot was not prepared as Article 6 stated; or 2. The ballot has more than one candidate’s name filled; or. 3. Other words or marks are filled in addition to the information Article 7 stated; or 4. The candidate’s full name filled in the ballot does not conform to the director candidate list after verification; or 5. The writing is unclear and indecipherable. |
Because the Company adopts the candidates nomination system, the Rules for Election of Directors of the Company is amended. |
|---|---|---|---|---|---|
| candidate list after verification; or The writing is unclear and indecipherable. |
|||||
the candidate whose name is filled in the ballot is a non-shareholder, and a |
|||||
cross-check shows that |
the candidate's name and identity card number do not match.
Resolution:
Discussion Items (I) Proposal 2
Proposal: Amendment to the Rules of Procedure for Shareholders’ Meetings of the Company. Please discuss and resolve.
Proposed by the Board of Directors Explanation: To refer to the sample template announced in the order Tai-Cheng-Chih-Li-Zi No. 1090009468 dated Jane 3, 2020 and Tai-Cheng-Chih-Li-Zi No. 1100001446 dated January 28, 2021 by the Taiwan Stock Exchange Corporation, certain articles of the Rules of Procedure for Shareholders’ Meetings provided by the Company have been amended. The comparison table for articles before and after amendment is hereby attached. Please determine whether the amendments are reasonable.
| Article | Current Article |
Amended Article | Reason for Amendment |
|
|---|---|---|---|---|
| Article 3 |
(above 4 paragraph omitted) Election or dismissal of directors, amendments to the Articles of Incorporation, capital reduction, application to be delisted from public offering, lifting of non-competition restriction of directors, capital increase by retained earnings, capital increase by capital reserve, dissolution, merger, or demerger of the corporation, or any matter under Paragraph 1 of Article 185 of the Company Act shall be set out in the notice of the |
(above 4 paragraph omitted) Election or dismissal of directors, amendments to the Articles of Incorporation, capital reduction, application to be delisted from public offering, lifting of non-competition restriction of directors, capital increase by retained earnings, capital increase by capital reserve, dissolution, merger, or demerger of the corporation, or any matter under Paragraph 1 of Article 185 of the Company Act,Articles 26-1 and 43-6 of the |
1. Amended in accordance with the order Tai-Cheng- Chih-Li-Zi No. 1090009468 dated Jane 3, 2020 and the order Tai-Cheng- Chih-Li-Zi No. 1100001446 dated January 28, 2021 by the Taiwan Stock |
reasons for convening the Securities Exchange Act, - - shareholders’ meeting. Articles 56 1 and 60 2 of None of the above matters the Regulations may be raised by an Governing the Offering extraordinary motion. The and Issuance of Securities content of such matters by Securities Issuers shall shall be uploaded to a be set out in the notice of website designated by the the reasons for convening competent authority or the the shareholders’ meeting. Company, and the website None of the above matters shall be specified on the may be raised by an meeting notice. extraordinary motion. Where the meeting Where the meeting agenda has specified agenda has specified general re-elections of the general re-elections of the directors and the terms of directors and the terms of the directors’ office, the the directors’ office, the terms of office of the terms of office of the directors shall not be directors shall not be altered by raising an altered by raising an extraordinary motion or extraordinary motion or any other method upon any other method upon the completion of the the completion of the general elections at the general elections at the shareholders’ meeting. shareholders’ meeting. A shareholder holding 1 A shareholder holding 1 percent or more of the percent or more of the total number of issued total number of issued shares may submit to the shares may submit to the Company a proposal for Company a proposal for discussion at an annual discussion at an annual shareholders’ meeting. shareholders’ meeting. Such proposals, however, Such proposals, however, are limited to one item are limited to one item only, and no proposal only, and no proposal containin more than one containin more than one g g
Exchange Corporation. 2. Amended in accordance with Article 172-1 Item 5 of the Company Act and the order Jing-Shang -Zi No. 0700105410 by the Ministry of Economic Affairs.
| item will be included in the Meeting Agenda. However, when a shareholder’s proposal contains suggestions or recommendations for the Company to enhance the public interest or facilitate |
item will be included in the Meeting Agenda. In addition, when the circumstances of any subparagraph of paragraph 4 of Article 172-1 of the Company Act apply to a proposal put forward by a shareholder, the Board of Directors may exclude it from the Agenda. A shareholder may propose a recommendation for urging the corporation to promote public interests or fulfill social responsibilities, and the providing procedure shall |
||
|---|---|---|---|
the Company to fulfill its corporate social responsibility, the Board of Directors may include such proposal into the agenda.In addition, when the circumstances of any subparagraph of paragraph 4 of Article 172-1 of the Company Act apply to a proposal put forward by a shareholder, the Board of Directors may exclude it from the Agenda. (below omitted) |
|||
be in accordance with Article 172-1 of the Company Act. (below omitted) |
|||
| Article 9 |
Quorum at shareholders’ meetings shall be calculated based on numbers of shares. The quorum shall be calculated according to the shares indicated by the sign-in cards handed in plus the number of shares whose voting rights are exercised in writing or by wayof electronic |
Quorum at shareholders’ meetings shall be calculated based on numbers of shares. The quorum shall be calculated according to the shares indicated by the sign-in cards handed in plus the number of shares whose voting rights are exercised in writing or by wayof electronic |
Amended in accordance with the order Tai-Cheng-C hih-Li-Zi No. 1100001446 dated January 28, 2021 by the Taiwan Stock Exchange Corporation. |
| transmission. The Chair shall call the meeting to order at the appointed meeting time. However, when the attending shareholders do not represent a majority of the total number of issued shares, the Chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than 1 hour, may be made. If the quorum is not met after two postponements and the attending shareholders still represent less than one third of the total number of issued shares, the Chair shall declare the meeting adjourned. (below omitted) |
transmission. The Chair shall call the meeting to order at the appointed meeting time, and meanwhile shall announce the related information about the total number of shares held by shareholders having no voting right and |
||
|---|---|---|---|
the total number of shares |
|||
| represented by the shareholders present at the |
|||
meeting. However, when the attending shareholders do not represent a majority of the total number of issued shares, the Chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than 1 hour, may be made. If the quorum is not met after two postponements and the attending shareholders still represent less than one third of the total number of issued shares, the Chair shall declare the meeting adjourned. (below omitted) |
| Article 14 |
The election of directors at a shareholders’ meeting shall be held in accordance with the applicable election and appointment rules adopted by the Company, and the voting results shall be announced on-site immediately, including the names of those elected as directors and the numbers of votes with which they were elected. (below omitted) |
The election of directors at a shareholders’ meeting shall be held in accordance with the applicable election and appointment rules adopted by the Company, and the voting results shall be announced on-site immediately, including the names of those elected and not electedas directors, and the numbers of votes with which they were electedand not elected. (below omitted) |
Amended in accordance with the order Tai-Cheng-C hih-Li-Zi No. 1100001446 dated January 28, 2021 by the Taiwan Stock Exchange Corporation. |
|---|---|---|---|
Resolution:
Election Items
Proposal: The Company’s Directors have their tenure expired. Please elect the Board of Directors to conform to the applicable laws. Proposed by the Board of Directors
Explanation:
-
The Company’s current directors were elected in the Annual Shareholders’ Meeting on June 20, 2018 and have their tenure expired on June 19, 2021. To conform to the applicable Rule, the Company shall elect 15 directors (including 4 independent directors) using the cumulative voting system. The tenure of new session of Directors (including independent directors) shall be three years, starting June 23, 2021 until June 22, 2024.
-
The election of Directors (including independent directors) shall adopt the candidate nomination system in accordance with Article 192-1 of the Company Act and the Article 20 of the Company's Articles of Incorporation. The shareholders with over 1% shareholding of the Company nominated 15 Directors Candidates (including independent directors) on April 26, 2021. The related information of the 11 Director Candidates is shown below:
| below: | |||
|---|---|---|---|
| Name | Education | Major Experience | Shareholding (Share) |
| Jason Lin | Master of Science in Environmental Sciences, Wageningen Agricultural University |
Current Appointment: Chairman and President of FPC President of FPC-USA Experiences: President of FPC |
0 |
| Name | Education | Major Experience | Shareholding (Share) |
|---|---|---|---|
| William Wong Representative of Formosa Chemicals & Fibre Corporation |
Master of Industrial Engineering, University of Houston |
Current Appointment: Chairman of Chinese National Federation of Industries Chairman of Taiwan Textile Federation Chairman of FCFC Chairman of Formosa Taffeta Co., Ltd. Chairman of Formosa Advanced Technology Co., Ltd. Experiences: President of FCFC |
486,978,693 |
| Susan Wang Representative of Nanya Plastics Corporation |
Barnard College, U.S. |
Current Appointment: Managing Director of FPCC Director of Nanya Technology Corp. Director of Formosa Sumco Technology Corp. Experiences: Executive Vice President of FPC-USA |
294,793,105 |
| Wilfred Wang Representative of Formosa Petrochemical Corporation |
BA of Mechanical Engineering, University of London |
Current Appointment: Managing Director of FCFC Managing Director of Nanya Plastics Corp. Managing Director of FPCC Experiences: Chairman of FPCC |
131,460,365 |
| Name | Education | Major Experience | Shareholding (Share) |
|---|---|---|---|
| C. T. Lee | BA of Chemical Engineering, National Cheng Kung University |
Current Appointment: Chairman of FPC-USA Experiences: Chairman of FPC |
1,846,541 |
| Cher Wang | BA of Economics, University of California, Berkeley |
Current Appointment: Chairman of HTC Experiences: Chairman of VIA Technologies,INC. |
7,369,380 |
| Ralph Ho | BA of Industrial Administration, University of San Francisco |
Current Appointment: Chairman of Y F Chemical Corp. Experiences: Chairman of Y F Baxter International Corp. |
27,824,363 |
| K. H. Wu | BA of Mechanical Engineering, Chung Yuan Christian University |
Current Appointment: Consultant of Formosa Heavy Industries Corp. Experiences: President of Formosa Heavy Industries Corp. |
134,537 |
| Sang-Chi Lin | BA of Electrical Engineering, Ming Chi Institute of Technology |
Current Appointment: Chairman of Formosa Plastics Construction Corp. Experiences: Assistant Manager of Nanya Plastics Corp. |
0 |
| Name | Education | Major Experience | Shareholding (Share) |
|---|---|---|---|
| Jerry Lin | BA of Business Administration, National Chengchi University |
Current Appointment: Senior Vice President of FPC Experiences: Vice President of FPC |
0 |
| Cheng-Chung Cheng |
BA of Chemistry, National Chung Hsing University |
Current Appointment: Consultant of FPC Experiences: Senior Vice President of FPC |
0 |
The related information of the 4 Independent Director Candidates is shown below:
| Name | Education | Major Experience | Shareholding (Share) |
|---|---|---|---|
| C. L. Wei | Ph.D. of Economic, Paris of University |
Current Appointment: Chairman of Waterland Financial Holdings Co., Ltd. Experiences: Chairman of Land Bank of Taiwan |
0 |
| C. J. Wu | Ph.D. of Education, National Taiwan Normal University |
Current Appointment: President of Taiwan University of Education Experiences: Minister of Ministry of Education |
0 |
| Yen-Shiang Shih | Ph.D. of Massachusetts Institute of Technology |
Current Appointment: Chair Professor of Chung Yuan Christian University Chairman of Sustainable and Circular Economy Development |
0 |
| Association. Experiences: Minister and Vice Minister of Ministry of Economic Affairs Chairman of Chinese Petroleum Corporation |
|||
|---|---|---|---|
| Wen-Chyi Ong | Master of Investment and Financial Risk Management, City, University of London |
Current Appointment: Professor of National ChengChi University Experiences: Chairman of SinoPac Financial Holdings Company Limited Chairman of Chunghwa Post Co., Ltd. |
0 |
Resolution:
Discussion Items (II) Proposal 1
Proposal: Appropriateness of releasing the newly elected Directors and the juristic person shareholder which appointed their authorized representatives to be elected as directors, from non-competition restrictions. Please discuss and resolve.
Proposed by the Board of Directors
Explanation:
-
According to Article 209 of the Company Act, any Director conducting business for himself/herself or on another’s behalf, and the scope of which coincides with the Company’s business scope, shall explain at the Shareholders’ Meeting the essential contents of such conduct and obtain approval from shareholders in the Meeting.
-
Meanwhile, according to Explanation Letter No.89206938, announced by the Ministry of Economic Affairs dated April 24, 2000, when the juristic person shareholder appoints its authorized representatives to be elected as directors according to Article 27-2 of the Company Act, both the juristic person shareholder and the authorized representatives shall be governed by the non-competition restrictions of Article 209 of the Company Act.
-
The list of newly-elected Directors and the juristic person shareholder who appoints its authorized representatives to be elected as directors in annual Shareholders’ Meeting of 2021 as the same or similar duty in other companies within the scope of the Company's business is as follow. Based on the premise interest of the Company without impairment, it is proposed to release the Directors and juristic person shareholders which appoints its authorized representatives to be elected as directors after having assumed office from non-competition restrictions for approval following Article 209 of the Company Act.
| Name | Concurrently Hold Position in Other Company |
|---|---|
| Jason Lin | Chairman of Formosa Daikin Advanced Chemicals Co., Ltd. Chairman of Formosa Tokuyama Advanced Chemicals Co., Ltd. Director and President of Formosa Plastics Corporation,U.S.A |
| William Wong Representative of Formosa Chemicals & Fibre Corporation |
Chairman of Formosa Chemicals & Fibre Corporation Managing Director of Nanya Plastics Corporation Managing Director of Formosa Petrochemical Corporation Managing Director of Formosa Idemitsu Petrochemical Corporation Director of Formosa Ineos Chemicals Corporation Director of Formosa Daikin Advanced Chemicals Co., Ltd. Director of Formosa Tokuyama Advanced Chemicals Co., Ltd. Director of Formosa Plastics Corporation,U.S.A |
| Susan Wang Representative of Nanya Plastics Corporation |
Managing Director of Formosa Petrochemical Corporation Director of Formosa Plastics Corporation,U.S.A |
| Wilfred Wang Representative of Formosa Petrochemical Corporation |
Managing Director of Nanya Plastics Corporation Managing Director of Formosa Chemicals & Fibre Corporation Managing Director of Formosa Petrochemical Corporation |
| C. T. Lee | Chairman of Formosa Plastics Corporation, U.S.A |
Resolution:
6
(English Translation of Consolidated Financial Statements Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income
For the years ended December 31, 2020 and 2019
(Expressed in Thousands of New Taiwan Dollars, Except for Earnings Per Common Share)
| 4000 (Notes 6(r) and 7) 5000 (Notes 6(e)(g)(h)(n)(s) and 7) Gross profit Operating expenses (Notes 6(c)(g)(h)(n)(s) and 7): 6100 6200 6300 6450 Total operating expenses Operating income Non-operating income and expenses (Notes 6(f)(g)(h)(m)(t) and 7): 7100 7010 7020 7050 7060 Total non-operating income and expenses Profit from continuing operations before tax 9300 Less: Income tax expenses (Note 6(o)) Profit 8300 Other comprehensive income (loss): (Note 6(n)(o)(p)) 8310 Components of other comprehensive income (loss) that will not be reclassified to profit or loss 8311 Losses on remeasurements of defined benefit plans 8316 Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income(loss) 8320 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will not be reclassified to profit or loss 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8360 Components of other comprehensive income (loss) that will be reclassified to profit or loss 8361 Exchange differences on translation of foreign financial statements 8370 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss 8399 Income tax related to components of other comprehensive income that will be reclassified to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8300 Other comprehensive income (loss) 8500 Total comprehensive income (loss) Basic earnings per share (Note 6(q)) |
2020 |
|---|---|
See accompanying notes to consolidated financial statements.
5
(English Translation of Financial Statements and Report Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION
Statements of Comprehensive Income
For the years ended December 31, 2020 and 2019
(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)
| 4000 Operating revenue (Notes 6(r) and 7) 5000 Operating costs (Notes 6(e)(g)(h)(n)(s) and 7) Gross profit 5920 Add: Realized profit (loss) on from sales Gross profit from operations Operating expenses (Notes 6(c)(g)(h)(n)(s) and 7): 6100 Selling expenses 6200 Administrative expenses 6300 Research and development expenses 6450 Expected credit gain Total operating expenses Operating income Non-operating income and expenses (Notes 6(f)(n)(t) and 7): 7100 Total interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7070 Share of profit of associates and joint ventures accounted for using equity method, net Total non-operating income and expenses Profit from continuing operations before tax 6400 Less: Income tax expenses (Note 6(o)) Profit 8300 Other comprehensive income (loss) (Note (n)(o)(p)): 8310 Components of other comprehensive income (loss) that will not be reclassified to profit or loss 8311 Losses on remeasurements of defined benefit plans 8316 Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income 8330 Share of other comprehensive income of subsidiaries, associates and joint ventures accounted for using equity method, components of other comprehensive income that will not be reclassified to profit or loss 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8360 Components of other comprehensive income (loss) that will be reclassified to profit or loss 8361 Exchange differences on translation of foreign financial statements 8380 Share of other comprehensive income of subsidiaries, associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss 8399 Income tax related to components of other comprehensive income that will be reclassified to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8300 Other comprehensive income (loss) Total comprehensive income (loss) 9710 Basic earnings per share -before income tax (Note 6(q)) |
2020 |
|---|---|
See accompanying notes to financial statements.
| (English Translation of Consolidated Financial Statements Originally Issued in Chinese) | FORMOSA PLASTICS CORPORATION AND SUBSIDIARIES | Consolidated Balance Sheets | December 31, 2020 and 2019 | (Expressed in Thousands of New Taiwan Dollars) | December 31, 2020 December 31, 2019 |
December 31, 2020 December 31, 2019 |
Amount % Amount % Liabilities and Equity |
Current liabilities: | 14,145,110 3 18,165,952 4 2100 (Notes 6(i)) |
3,888,883 1 4,044,356 1 2110 (Note 6(j)) |
102,218,948 21 102,342,079 20 2170 |
2,148,261 1 2,584,690 - 2180 (Note 7) |
10,372,878 2 7,392,229 1 2200 |
3,439,213 1 3,562,016 1 2220 (Note 7) |
936,148 - 997,608 - 2280 (Note 6(m)) |
6,499,202 1 14,791,036 3 2321 (Note 6(l)) |
16,681,271 4 18,269,476 4 2322 (Notes 6(k) and 8) |
5,305,846 1 3,467,418 1 2399 (Note 7) |
5,305,846 1 3,467,418 1 2399 (Note 7) |
165,635,760 35 175,616,860 35 Total current liabilities |
Non-Current liabilities: | 18,647,715 4 21,408,559 4 2530 (Note 6(l)) |
193,979,093 40 202,446,613 41 2540 (Note 6(k) and 8) |
86,785,954 18 85,635,983 17 2570 (Note 6(o)) |
1,147,126 - 1,055,171 - 2580 (Note 6(m)) |
590,274 - 423,488 - 2622 (Note 7) |
2,859,857 1 2,871,940 1 2640 -non-current (Note 6(n)) |
2,859,857 1 2,871,940 1 2640 -non-current (Note 6(n)) |
9,634,644 2 7,629,345 2 2670 (Note 6(f)) |
9,634,644 2 7,629,345 2 2670 (Note 6(f)) |
313,644,663 65 321,471,099 65 Total non-current liabilities |
Total liabilities | Equity (Note 6(p)): | 3110 | 3200 | Retained earnings: | 3310 | 3320 | 3350 | Total retained earnings | 3400 | 3400 | 479,280,423 100 497,087,959 100 Total equity |
479,280,423 100 497,087,959 100 Total equity |
Total liabilities and equity |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| $ | $ |
==> picture [328 x 105] intentionally omitted <==
| December 31, 2020 December 31, 2019 |
Amount % Amount % |
$ 14,627,108 3 16,170,175 4 16,996,824 4 14,991,544 3 3,563,593 1 2,775,256 1 6,825,377 1 6,743,427 1 2,636,727 1 1,772,799 - 1,080,287 - 1,099,004 - 21,452 - 32,878 - 2,898,401 1 - - 2,000,000 - 3,488,889 1 10,073,563 2 9,681,968 2 60,723,332 13 56,755,940 12 38,012,054 8 32,564,312 7 - - 1,944,444 - 17,703,412 4 17,028,048 4 121,923 - 19,319 - 6,560,931 2 6,910,706 2 71,238 - 69,481 - 62,469,558 14 58,536,310 13 123,192,890 27 115,292,250 25 63,657,408 14 63,657,408 14 11,742,124 3 11,724,498 2 65,791,185 14 62,058,769 13 68,879,676 15 63,968,902 14 55,559,015 12 72,320,189 16 190,229,876 41 198,347,860 43 66,906,732 15 75,423,554 16 332,536,140 73 349,153,320 75 $ 455,729,030 100 464,445,570 100 |
|---|---|---|
| (English Translation of Financial Statements and Report Originally Issued in Chinese) | FORMOSA PLASTICS CORPORATION | Balance Sheets | December 31, 2020 and 2019 | (Expressed in Thousands of New Taiwan Dollars) | December 31, 2020 December 31, 2019 |
December 31, 2020 December 31, 2019 |
Amount % Amount % Liabilities and Equity |
Amount % Amount % Liabilities and Equity |
Current liabilities: | $ 3,768,327 1 12,301,257 3 2100 Short-term borrowings (Notes 6(i)) |
3,888,883 1 4,044,356 1 2110 Short-term notes and bills payable (Note 6(j)) |
3,888,883 1 4,044,356 1 2110 Short-term notes and bills payable (Note 6(j)) |
102,218,948 22 102,342,079 22 2170 Accounts payable |
102,218,948 22 102,342,079 22 2170 Accounts payable |
2180 Accounts payable�related parties (Note 7) |
2180 Accounts payable�related parties (Note 7) |
7,398,424 2 4,931,809 1 2200 Other payables |
4,377,266 1 5,294,496 1 2220 Other payables�related parties (Note 7) |
909,517 - 970,934 - 2280 Current lease liabilities (Note 6(m)) |
7,355,148 2 15,903,748 3 2321 Current portion of bonds payable (Note 6(l)) |
9,730,081 2 10,682,599 2 2322 Current portion of long-term debts (Notes 6(k) and 8) |
3,154,905 1 2,344,034 1 2399 Other current liabilities |
3,154,905 1 2,344,034 1 2399 Other current liabilities |
142,801,499 32 158,815,312 34 Total current liabilities |
142,801,499 32 158,815,312 34 Total current liabilities |
Non-Current liabilities: | 18,539,632 4 9,924,415 2 2530 Bonds payable (Note 6(l)) |
244,629,349 54 249,152,130 54 2540 Long-term debts (Note 6(k) and 8) |
41,804,267 9 39,280,562 9 2570 Deferred tax liabilities (Note 6(o)) |
141,821 - 51,805 - 2580 Non-current lease liabilities (Notes 6(m)) |
124,762 - 124,762 - 2640 Net defined benefit liabilities (Note 6(n)) |
1,702,088 - 1,861,535 - 2670 Other non-current liabilities |
5,985,612 1 5,235,049 1 Total non-current liabilities |
312,927,531 68 305,630,258 66 Total liabilities |
Equity (Notes 6(p)): | 3110 Common stock |
3200 Capital surplus |
Retained earnings: | 3310 Legal reserve |
3320 Special reserve |
3350 Unappropriated retained earnings |
Total retained earnings | 3400 Other components of equity |
Total equity | $ 455,729,030 100 464,445,570 100 Total liabilities and equity |
$ 455,729,030 100 464,445,570 100 Total liabilities and equity |
|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Assets | Current assets: | Cash and cash equivalents (Note 6(a)) | Current financial assets at fair value through profit or loss (note 6(b)) | Current financial assets at fair value through other comprehensive income | (Note 6(b)) | Notes and accounts receivable, net (Notes 6(c)) | Accounts receivable�related parties (Note 6(c) and 7) | Other receivables (Notes 6(d)) | Other receivables�related parties (Note 6(d) and 7) | Inventories (note 6(e)) | Other current assets | Total current assets | Non-current assets: | Financial assets at fair value through other comprehensive income-non- current (Note 6(b)) |
Investments accounted for using equity method (Note 6(f) and 7) | Property, plant and equipment (Notes 6(g), 7 and 8) | Right-of-use assets (Notes 6(h)) | Intangible assets | Deferred tax assets (Note 6(o)) | Other non-current assets (Notes 8) | Total non-current assets | Total assets | |||||||||||||||||||||||||
| 1100 | 1110 | 1120 | 1170 | 1180 | 1200 | 1210 | 130X | 1470 | 1510 | 1550 | 1600 | 1755 | 1780 | 1840 | 1900 |
| (English Translation of Consolidated Financial Statements Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION AND SUBSIDIARIES Consolidated Statements of Changes in Equity For the years ended December 31, 2020 and 2019 (Expressed in Thousands of New Taiwan Dollars) Equity attributable to owners of parent Total other equity interest Share capital Retained earnings Ordinary shares Capital surplus Legal reserve Special reserve Unappropriate d retained earnings Exchange differences on translation of foreign financial statements Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income Gains (losses) on hedging instruments Total equity Balance at January 1, 2019 $ 63,657,408 11,713,842 57,103,815 58,778,533 82,499,843 (1,556,605) 83,389,928 (18,763) 355,568,001 Net Income for the period - - - - 37,324,162 - - - 37,324,162 Other comprehensive income (loss) for the period, net of income tax - - - - (377,598) (3,721,645) (2,688,903) 19,542 (6,768,604) Total comprehensive income (loss) for the period - - - - 36,946,564 (3,721,645) (2,688,903) 19,542 30,555,558 Appropriation and distribution of retained earnings: Legal reserve appropriated - - 4,954,954 - (4,954,954) - - - - Special reserve appropriated - - - 5,190,369 (5,190,369) - - - - Cash dividends of ordinary share - - - - (36,921,297) - - - (36,921,297) Changes in equity of associates and joint ventures accounted for using equity method - - - - (59,598) - - - (59,598) Other changes in capital surplus: Changes in equity of associates and joint ventures accounted for using equity method - 4,003 - - - - - - 4,003 Other changes in capital surplus - 6,653 - - - - - - 6,653 Balance at December 31, 2019 63,657,408 11,724,498 62,058,769 63,968,902 72,320,189 (5,278,250) 80,701,025 779 349,153,320 Net loss for the period - - - - 20,036,199 - - - 20,036,199 Other comprehensive income (loss) for the period, net of income tax - - - - (92,181) (4,324,810) (4,229,221) 37,209 (8,609,003) Total comprehensive income (loss) for the period - - - - 19,944,018 (4,324,810) (4,229,221) 37,209 11,427,196 Appropriation and distribution of retained earnings: Legal reserve appropriated - - 3,732,416 - (3,732,416) - - - - Special reserve appropriated - - - 4,910,774 (4,910,774) - - - - Cash dividends of ordinary share - - - - (28,009,259) - - - (28,009,259) Changes in equity of associates and joint ventures accounted for using equity method - - - - (52,743) - - - (52,743) Other changes in capital surplus: Changes in equity of associates and joint ventures accounted for using equity method - 5,407 - - - - - - 5,407 Other changes in capital surplus - 12,219 - - - - - - 12,219 Balance at December 31, 2020 $ 63,657,408 11,742,124 65,791,185 68,879,676 55,559,015 (9,603,060) 76,471,804 37,988 332,536,140 |
355,568,001 | 37,324,162 (6,768,604) |
30,555,558 | - - (36,921,297) (59,598) 4,003 6,653 |
349,153,320 20,036,199 (8,609,003) |
11,427,196 | - - (28,009,259) (52,743) 5,407 12,219 |
332,536,140 |
|---|---|---|---|---|---|---|---|---|
| Total equity | 355,568,001 | 37,324,162 | (6,768,604) | 30,555,558 | - | - | (36,921,297) | (59,598) | 4,003 | 6,653 | 349,153,320 | 20,036,199 | (8,609,003) | 11,427,196 | - | - | (28,009,259) | (52,743) | 5,407 | 12,219 | 332,536,140 | |||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (English Translation of Parent Company Only Financial Statements and Report Originally Issued in Chinese) | FORMOSA PLASTICS CORPORATION | Statements of Changes in Equity | For the years ended December 31, 2020 and 2019 | (Expressed in Thousands of New Taiwan Dollars) | Total other equity interest | Share capital Retained earnings Unrealized |
gains (losses) | from financial | Exchange assets measured |
differences on at fair value |
Unappropriated translation of through other Gains (losses) |
Ordinary retained foreign financial comprehensive on hedging |
shares Capital surplus Legal reserve Special reserve earnings statements income instruments |
Balance at January 1, 2019 $ 63,657,408 11,713,842 57,103,815 58,778,533 82,499,843 (1,556,605) 83,389,928 (18,763) |
Net Income for the period - - - - 37,324,162 - - - |
Other comprehensive income (loss) for the period - - - - (377,598) (3,721,645) (2,688,903) 19,542 |
Total comprehensive income (loss) for the period - - - - 36,946,564 (3,721,645) (2,688,903) 19,542 |
Appropriation and distribution of retained earnings: | Legal reserve appropriated - - 4,954,954 - (4,954,954) - - - |
Special reserve appropriated - - - 5,190,369 (5,190,369) - - - |
Cash dividends of ordinary share - - - - (36,921,297) - - - |
Changes in equity of associates and joint ventures accounted - - - - (59,598) - - - |
Other changes in capital surplus: | Changes in equity of associates and joint ventures accounted for using equity method - 4,003 - - - - - - |
Other changes in capital surplus - 6,653 - - - - - - |
Balance at December 31, 2019 63,657,408 11,724,498 62,058,769 63,968,902 72,320,189 (5,278,250) 80,701,025 779 |
Net Income for the period - - - - 20,036,199 - - - |
Other comprehensive income (loss) for the period - - - - (92,181) (4,324,810) (4,229,221) 37,209 |
Total comprehensive income (loss) for the period - - - - 19,944,018 (4,324,810) (4,229,221) 37,209 |
Appropriation and distribution of retained earnings: | Legal reserve appropriated - - 3,732,416 - (3,732,416) - - - |
Special reserve appropriated - - - 4,910,774 (4,910,774) - - - |
Cash dividends of ordinary share - - - - (28,009,259) - - - |
Changes in equity of associates and joint ventures accounted - - - - (52,743) - - - |
Other changes in capital surplus: | Changes in equity of associates and joint ventures accounted for using equity method - 5,407 - - - - - - |
Other changes in capital surplus - 12,219 - - - - - - |
Balance at December 31, 2020 $ 63,657,408 11,742,124 65,791,185 68,879,676 55,559,015 (9,603,060) 76,471,804 37,988 |
8
(English Translation of Consolidated Financial Statements Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
For the years ended December 31, 2020 and 2019
(Expressed in Thousands of New Taiwan Dollars)
| Cash flows from operating activities: Income before income tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Expected credit gain Net gain (loss) on financial assets or liabilities at fair value through profit Interest expense Interest income Dividend income Share of profit of associates and joint ventures accounted for using equity method Gain on disposal of property, plant and equipment Gain on disposal of right-of-use assets Unrealized foreign exchange (gain) loss Total adjustments to reconcile loss (profit) Changes in operating assets and liabilities: Changes in operating assets: Notes receivable Accounts receivable Accounts receivable due from related parties Other receivables Other receivables due from related parties Inventories Other current assets Total changes in operating assets Changes in operating liabilities: Accounts payable Accounts payable to related parties Other payables Other payables to related parties Other current liabilities Net defined benefit liability Total changes in operating liabilities Total changes in operating assets and liabilities Total adjustments Cash inflow generated from operations Interest received Dividends received Interest paid Income taxes paid Net cash flows from operating activities Cash flows from (used in) investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Acquisition of investments accounted for using equity method Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of intangible assets Decrease in other receivables due from related parties Acquisition of right-of-use assets Proceeds from disposal of right-of-use assets Increase in other non-current assets Net cash flows used in investing activities Cash flows from (used in) financing activities: Increase in short-term borrowings Decrease in short-term borrowings Increase in short-term notes and bills payable Proceeds from issuing bonds Repayments of bonds Proceeds from long-term debt Repayments of long-term debt (Decrease) Increase in due to related parties (recognized as other payables�related parties) Payment of lease liabilities Decrease in other non-current liabilities Cash dividends paid Net cash flows used in financing activities Effect of exchange rate changes on cash and cash equivalents Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period |
2020 $ 24,166,667 7,210,271 791,281 (1,565) 155,473 1,206,988 (374,256) (3,358,166) (5,212,882) (8,803) - (45,042) 363,299 436,428 (2,934,044) 122,804 108,293 (204,072) 1,348,028 (1,837,435) (2,959,998) 1,797,199 255,174 198,260 (553,117) (5,236) (408,019) 1,284,261 (1,675,737) (1,312,438) 22,854,229 367,388 11,694,866 (1,201,708) (2,270,322) 31,444,453 - 12,500 (625,000) (8,883,039) 19,808 (214,341) 8,499,835 - - (2,725,618) (3,915,855) 333,456,117 (338,190,057) 2,000,000 8,350,000 - 1,536,598 (4,592,694) (6,978,720) (37,891) (98,896) (28,012,404) (32,567,947) 1,018,507 (4,020,842) 18,165,952 $ 14,145,110 |
2019 42,219,152 |
|
|---|---|---|---|
| 6,909,994 481,013 (1,567) (27,107) 1,359,114 (623,668) (8,186,145) (14,734,118) (31,109) (12,834) 1,755,009 |
|||
| (13,111,418) | |||
| (152,244) 1,938,516 733,575 371,720 (391,997) 2,444,492 127,399 |
|||
| 5,071,461 | |||
| (91,835) (1,165,761) (560,817) 806,845 (608,817) (542,266) |
|||
| (2,162,651) | |||
| 2,908,810 | |||
| (10,202,608) | |||
| 32,016,544 635,930 22,475,201 (1,363,206) (7,184,041) |
|||
| 46,580,428 | |||
| (229,555) - (1,951,323) (17,293,279) 44,773 (52,559) 2,293,804 (684,825) 13,630 (2,657,326) |
|||
| (20,516,660) | |||
| 341,549,459 (341,928,883) 3,000,000 - (4,600,000) 2,300,000 (6,491,026) 11,663,632 (32,421) (78,446) (36,927,613) |
|||
| (31,545,298) | |||
| 336,710 | |||
| (5,144,820) 23,310,772 |
|||
| 18,165,952 |
See accompanying notes to consolidated financial statements.
7
(English Translation of and Report Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION
Statements of Cash Flows
For the years ended December 31, 2020 and 2019
(Expressed in Thousands of New Taiwan Dollars)
| Cash flows from operating activities: Income before income tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Expected credit gain Interest expense Net loss(gain) on financial assets at fair value through profit Interest income Dividend income Share of profit of associates and joint ventures accounted for using equity method Gain on disposal of property, plant and equipment Realized loss (profit) on from sales Unrealized foreign exchange gain Total adjustments to reconcile profit Changes in operating assets and liabilities: Changes in operating assets: Notes and accounts receivable Accounts receivable due from related parties Other receivable Other receivable due from related parties Inventories Other current assets Total changes in operating assets Changes in operating liabilities: Accounts payable Accounts payable to related parties Other payable Other payable to related parties Other current liabilities Net defined benefit liability Total changes in operating liabilities Total changes in operating assets and liabilities Total adjustments Cash inflow generated from operations Interest received Dividends received Interest paid Income taxes paid Net cash flows from operating activities Cash flows (used in) from investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Liquidation of investments accounted for using equity method Acquisition of investments accounted for using equity method Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of intangible assets Decrease in other receivables due from related parties Increase in other non-current assets Net cash flows used in investing activities Cash flows from (used in) financing activities: Increase in short-term borrowings Decrease in short-term borrowings Increase in short-term notes and bills payable Proceeds from issuing bonds Repayments of bonds Proceeds from long-term debt Repayments of long-term debt Decrease in lease payable Decrease in other non-current liabilities Cash dividends paid Net cash flows used in financing activities Effect of exchange rate changes on cash and cash equivalents Net (decrease) increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period |
2020 $ 23,278,277 3,584,577 245,891 (1,687) 788,782 155,473 (229,622) (3,358,166) (6,869,606) (13,514) 59,955 (110,138) (5,748,055) (2,419,886) 917,230 90,816 (83,637) 712,341 (809,880) (1,593,016) 779,444 81,950 (4,104) (18,717) 364,670 (408,019) 795,224 (797,792) (6,545,847) 16,732,430 251,751 11,694,866 (756,578) (1,634,922) 26,287,547 - 12,500 236 (14,041,020) (5,835,240) 19,702 (2,000) 8,632,355 (985,255) (12,198,722) 326,554,054 (328,097,145) 2,000,000 8,350,000 - - (3,433,333) (37,891) (11,298) (28,012,404) (22,688,017) 66,262 (8,532,930) 12,301,257 $ 3,768,327 |
2019 41,792,121 |
|
|---|---|---|---|
| 3,909,081 133,555 (1,567) 931,962 (27,107) (519,376) (8,186,145) (16,390,959) (31,614) (42,800) (281,878) |
|||
| (20,506,848) | |||
| 2,140,592 514,635 393,102 180,510 3,471,424 (320,824) |
|||
| 6,379,439 | |||
| (96,315) (1,204,191) (398,575) (68,099) (1,201,193) (542,266) |
|||
| (3,510,639) | |||
| 2,868,800 | |||
| (17,638,048) | |||
| 24,154,073 536,374 22,475,202 (952,564) (6,253,106) |
|||
| 39,959,979 | |||
| (229,555) - - (5,044,323) (4,899,716) 44,769 - 2,150,603 (487,361) |
|||
| (8,465,583) | |||
| 333,165,116 (331,348,845) 3,000,000 - (4,600,000) 2,300,000 (3,788,889) (32,421) (89,518) (36,927,613) |
|||
| (38,322,170) | |||
| 187,396 | |||
| (6,640,378) 18,941,635 |
|||
| 12,301,257 |
See accompanying notes to financial statements.
Formosa Plastics Corporation Statement of Profits Distribution For the year of 2020
Unit ： NT$
| Unit：NT$ | ||
|---|---|---|
| Items | Amount | |
| Available for Distribution: 1.Unappropriated retained earnings of previous years 2.Net profit after tax of current year 3.Other profit items adjusted to the current year’s undistributed earnings other than after-tax net income for the period Total Distribution Items: 1.Appropriation of legal reserve 2.Appropriation of special reserve 3.Distribution of dividends and bonus in cash ( $2.4 per share) 4.Unappropriated retained earnings carried forward to next year Total |
35,668,118,388 20,036,199,064 -144,923,445 |
|
| 55,559,394,007 | ||
| 1,989,127,562 2,472,591,116 15,277,777,874 35,819,897,455 |
||
| 55,559,394,007 | ||
| Explanation | 1.The Company plans to distribute dividends of $2.4 per share for current year (among which, $1.2 per share will be distributed as dividends and $1.2 per share will be distributed as bonus); all of which are cash dividends. 2. The Company distributes dividends and bonus for a total of $15,277,777,874; all of which are from net profit after tax of 2020. 3. Other comprehensive income transferred to unappropriated earnings of current year is due to a re-measurement of the actuarial pension adjustment 4. While the distribution of cash dividends to each individual shareholder is less than 1 dollar, the distribution will be rounded to the nearest dollar. |