F.T.C — Investor Presentation 2020

Dec 17, 2020

2020 Investor Conference Formosa Taffeta Co., Ltd. Stock code ： 1434

Disclaimer

• The information contained in the document, other than number and data of financial reports, has not been audited or reviewed by any accountant or any independent third party. FTC does not ensure the fairness, completeness and accuracy of the information.

• This document may contain forward-looking statements, including but not limited to statements that address activities, events or developments that FTC expects or anticipates to occur in the future. All statements are based on FTC plans and best knowledge toward the future while subject to various factors and uncertainties beyond FTC’s control. Therefore, the actual results may differ materially from those contained in the forward-looking statements.

• This document does not constitute a public offer under any applicable legislation or an offer to sell or 。

• solicitation of an offer to buy any securities or financial instruments.

• This material must not be copied, reproduced, distributed or passed to others at any time, in whole or in part, without the prior written consent of FTC.

Agenda

1. Corporate Overview 2. Product Development 3. Financial Status 4. Operation Orientation 5. Q&A

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Corporate Overview

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Establishment of Production Bases

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1973 1992 1999 2004 2005 2016 2020
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Formosa Taffeta Co., Ltd. (Douliu) Formosa Taffeta Zhong-shan CO., Ltd. Formosa Taffeta Vietnam Co., Ltd. (Long-an Plant)	Formosa Taffeta Co., Ltd. (Douliu) Formosa Taffeta Zhong-shan CO., Ltd. Formosa Taffeta Vietnam Co., Ltd. (Long-an Plant)	Formosa Taffeta Dong- nai Co., Ltd. Formosa Taffeta Chang-shu Co., Ltd.	Gore Plant (Douliu) Expanded Corporation between FTC and Schoeller Textil AG
Number of employees
of five plants
Plant Headcount
Taiwan 4,339 China 816	Formosa Taffeta Co., Ltd whose paid in capital is 16.8 billion, has five production bases which are respectively located in Taiwan, China, and Vietnam. The Company's consolidated revenue as of 30thSep., 2020 is
Vietnam 2,160	NT$ 21.63 billion.
Total 7,315

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Products Breakdowns by Production Bases

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42.4%
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20.1%
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32.4%
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Filament Woven Fabrics of 1[st] Business Segment

Polyamine/Polyester Tire Cord Fabric of 2[nd] Business Segment

Petroleum goods/service of 2nd Business Segment

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Sales Volume Breakdown

of Polyamide/Polyester Filament Fabrics

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Other 6.43%
6.00%
Umbrella 23.51%
Fabric
Other Fashion &
6.43%
5.08% Leisure
9.58%
Sports
54.04%
Outdoors
8.33% 29.95%
22.59%
14.68%
Other
3.24% 4.70%
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Usage	Required Cloth	Functionality
Sports	fabric of flexibility and with multiple functions	moisture absorbent and quick drying, deodorant, and anti-bacterial
Outdoors	fabric with multiple functions, and coating & lamination processes	moisture permeability, waterproof, light- weighted and keeping warm
Fashion & Leisure	fabric as materials and of flexibility, whose hand emphasizes variety of garment styles	natural hand flexibility
Umbrella Fabric	for both sunny and rainy days	UV-cut, shading and cooling- down

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Sales Volume Breakdown of Polyamide/Polyester Tire Cord Business

Southeast Asia 36.41% Taiwan 20.96% India 17.96% North-east Asia 11.38% China 5.47% USA 4.26% Others 2.63% Europe 0.93% Data collected from Jan. to Sep., 2020	Representative Customers Taiwan Cheng Shin ( Maxxis ) KendaBridgestoneFederal Hwa FongNankang Japan YokohamaSumitomoBS Korea HankookHung-A KumhoNexen India MRFApolloJKCeat Europe ContinentalMichelinPirelli Tire USA GoodyearCooperTitan South-east Asia MultistradaSamson CasuminaDa Nang	Representative Customers Taiwan Cheng Shin ( Maxxis ) KendaBridgestoneFederal Hwa FongNankang Japan YokohamaSumitomoBS Korea HankookHung-A KumhoNexen India MRFApolloJKCeat Europe ContinentalMichelinPirelli Tire USA GoodyearCooperTitan South-east Asia MultistradaSamson CasuminaDa Nang
	Taiwan	Cheng Shin ( Maxxis ) KendaBridgestoneFederal Hwa FongNankang
	Japan	YokohamaSumitomoBS
	Korea	HankookHung-A KumhoNexen
	India	MRFApolloJKCeat
	Europe	ContinentalMichelinPirelli Tire
	USA	GoodyearCooperTitan
	South-east Asia	MultistradaSamson CasuminaDa Nang

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Sale of Petrol and Diesel

106 Locations of Formosa Petroleum Stations

Until Oct., 2020, there are 106 Formosa Petroleum

Stations whose locations are shown on the right.

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Taizi Rd., Rende Dist., Tainan City,
opened on 13 [rd] July,2020
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New Taipei City 1
Taoyuan City 4 stations station
Hsinchu County 1 station
Miaoli County 2 stations
Taichung City 10 stations
Changhua County18 station s Nantou County 6
Yunlin County 20 stations stations
Chiayi City 5 stations
Chiayi County 16
stations
Tainan City 12 station s
Kaohsiung City 6 stations
Pingtung County 5
stations
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Smart Textiles Functional Applications

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POCKET FABRIC

• Body mapping in woven and special fabric structure of dual-layer downproof is made through special patented fabric structure design and dyeing and finishing process.

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Application of Intelligent Temperature Module―POLO11

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• Intelligent temperature control clothing — Launch press conference on 15 Dec., 2017

• POLO11

• Ralph Lauren’s launch in Jan, 2019;

• — All functional fabrics for lining that are of water-repllent and tear resistance are made by the FTC’s Taiwan Plant

Product press conference ( in Dec. , 2017)

• Advanced Edition in the Next Generation: — Expected to be launched in 2020;

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• Functions:

• adjustable proactive  physiological monitoring heating control and (such as heart rate preservation; monitoring);

• weather warning;  active emergency SOS;  GPS positioning;  LED light security  fall detection; warning;  immediate image transmission etc.

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A+ SMART THERMAL TECHNOLOGY

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Advantages : the smart thermal technology system can be utilized and re-designed like building blocks base on different use. Functions: Light Warning, Sound Reminded, Intuition Controlled, Smart Thermal Controlled, Location Service, DMR/P2P Switched, Personal Locator Beacon, Call for Help Spontaneously, Alert for Environment, Online Streaming. Power supply: Any 5V power bank available the market, use time may varied due to different function featured in garment products.

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WEATHER/ENVIRONMENT
WARNING GPS
(STORM/MUDFLOOD/EARTHQUAKE (Missing / Lost contact )
) VIDEO
LEADING STREAMING
(GROUP/DM) (SEARCHING
ONLINE FUNCTION)
EXTENSIONS
SOUND
REMINDER
(RESCUE ASIST/
MOTION REMINDER) SMART LIGHT
GARMENT WARNING
THERMAL
BUILD-IN
CONTROL
FUNCTIONS
PLB SOS
(ULTIMATE RESCUE
SIGNAL)
FALLING DETECT
TOUCH CONTROL (Call for Help
Spontaneously)
(PRESS KEYS SET-UP)
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Performance for the Industrial Cluster

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Military personnel, the police,
and fire fighters
Outdoors &
Sports
Maternal and
long-term care Child Health Assistance for the
vision-impaired
Safe
Driving
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A+ SMART THERMAL TECHNOLOGY Got Awarded

• FTC has created the Smart Clothing System for Mountaineering in collaboration with Taiwan Textile Research Institute.

• Awarded the Taiwan Outdoor Group (TOG).

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Quality and Technological innovation

 Schoeller aerobrane :

Schoeller aerobrane consists of an ultra-fine and hydrophilic polyurethane composite. It offers a softer feel and higher air permeability. Compared with Microporous, its weight is 1/3 lighter and its air permeability can reached three times.

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aerobrane

Microporous

Hydrophilic

PTFE

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Omni-Heat Thermal Reflective technology

The precise calculation of the compaction of dotted aluminum alloys properties is able to keep the heat produced from the body in the clothing through the physical reflection principle. It not only increases the warmth performance by 20% and has the breathable functions.

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100 % recycled PET

• Wear2Wear is an international eco-friendly organization and dedicated to establishing a production system that can transform the second hand clothes into new functional textiles

• Schoeller and Schoeller Asia was inspired by Wear2Wear and create a 100 % recycled PET high quality protective fabric collection. This production has passed the certification of Bluesign and Oeko-tex Standard 100.

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Products made from Recycled Ghost

• FTC has applied the recycled nylon material, made from Ghost nets in the ocean, to the development and manufacture of fabrics which is estimated to produce five million yards per year (nearly three million clothing can be produced) , so as to protect the environment by reducing pollution resulted from Ghost nets and their impacts on marine ecology.

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Financial Status

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Consolidated Income Statement

	Expressed in Thousands of NTD	Expressed in Thousands of NTD	Expressed in Thousands of NTD	Expressed in Thousands of NTD	Expressed in Thousands of NTD	Expressed in Thousands of NTD
	Nine months ended September 30			2020
	2020	2019	Variance	Q3	Q2	Q1
Sales revenue	21,627,329	28,443,860	-24.0%	6,595,319	6,443,074	8,588,936
Net operating margin	2,190,619	3,172,936		508,594	666,115	1,015,910
Net margin	10.1%	11.2%	-1.0%	7.7%	10.3%	11.8%
Operating profit (loss)	343,927	1,094,132		-78,974	50,966	371,935
Operating profit Margin	1.6%	3.9%	-2.3%	-1.2%	0.8%	4.3%
Total non-operating income and expenses	1,562,914	2,166,215		224,183	1,262,339	76,392
Profit before income tax	1,906,841	3,260,347	-41.5%	145,209	1,313,305	448,327
Profit for the period from continuing operations	1,788,700	3,765,068	-52.5%	151,810	1,282,792	354,098
Rate ofprofit for theyear	8.3%	13.2%		2.3%	19.9%	4.1%
Profit attributable to common shareholders of the parent	1.13	2.14	-47.2%	0.09	0.78	0.26

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Comparison of revenues of the nine months of different businesses

	Comparison of revenues of the nine months of different businesses	Comparison of revenues of the nine months of different businesses	Comparison of revenues of the nine months of different businesses	Comparison of revenues of the nine months of different businesses	Comparison of revenues of the nine months of different businesses	Comparison of revenues of the nine months of different businesses
	Expressed in thousands of NTD
		1st Business Segment	Tire Cord Business	Oil Product Business	Others	Total
Nine months ended Sep. 30	2020	9,166,198	4,345,959	7,016,883	1,098,289	21,627,329
	2019	12,367,703	5,986,294	8,841,303	1,248,560	28,443,860
Variance		-3,201,505	-1,640,335	-1,824,420	-150,271	-6,816,531
Growth Rate		-25.9%	-27.4%	-20.6%	-12.0%	-24.0%

• A drop of 6.81 billion (24.0 % )in 2020 consolidated revenue of nine month—21.63 billion, compared to that of 2019 —28.44 billion, comes from:

• Disadvantageous difference in sale quantity of 4.04 billion: a result of an decrease of 2.96 billion of the filament fabric of the 1[st] Business Segment, and a decrease of 1.04 billion of tire cord fabric.

• Disadvantageous difference in sale price of 2.77 billion: a result of an decrease of 0.24 billion of the filament fabric of the 1[st] Business Segment, a decrease of 0.6 billion of tire cord fabric, and a decrease of 1.79 billion of Petroleum Business

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Cash Flow Statement

	Expressed in thousands of NTD Nine months ended Sep. 30 2020 2019 3,236,624 3,391,896 3,627,000 5,084,374 -880,414 -1,828,364 -129,080 -373,096 -1,238,843 2,650,102 281,928 -4,214,432 -4,129,205 131,287 -22,850 2,919,670 2,404,683 2,746,586 3,256,010	Expressed in thousands of NTD Nine months ended Sep. 30 2020 2019 3,236,624 3,391,896 3,627,000 5,084,374 -880,414 -1,828,364 -129,080 -373,096 -1,238,843 2,650,102 281,928 -4,214,432 -4,129,205 131,287 -22,850 2,919,670 2,404,683 2,746,586 3,256,010
	Nine months ended Sep. 30
	2020	2019
Cash at beginning of period	3,236,624	3,391,896
Net cash flows from operating activities (A)	3,627,000	5,084,374
Capital Expenditures (B)	-880,414	-1,828,364
Financial assets	-129,080	-373,096
Investment in Schoeller	-1,238,843
Bank borrowings	2,650,102	281,928
Dividends paid	-4,214,432	-4,129,205
Other	131,287	-22,850
Cash and cash equivalent at end of period	2,919,670	2,404,683
Free cash flow (A-B)	2,746,586	3,256,010

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Stable Profitability and Dividends Distribution

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Profit before income tax, EPS, and
Expressed in thousands cash dividends for the last 5 years dollars/
of NTD
share
3.33
6,000,000 3.5
3.12
3
5,000,000 2.66
2.24 2.5
4,000,000
2.5
1.81
2
2.1
3,000,000
1.9
1.5
1.5
2,000,000
1
1.2
1,000,000
0.5
3,761,297 4,474,799 5,276,484 4,529,407 5,163,958
0 0
2015 2016 2017 2018 2019
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Profit before income tax EPS

Cash dividends

Note: “ * ” refers to continuing operations

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Operation Orientation

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Operation Orientation—Overall

Smart Innovation Sustainable Future Continuously obtaining branded customers' recognition ─ Application of technology and ─ adidas considers FTC a cross-field collaboration ─ Top Player among its suppliers Cooperation Cross-industry Development of innovative ─ Nike recognizes FTC’s with Branded Intelligent textiles ─ eco-friendly products Customers R&D Sustainability, Environmental Protection, and Circular Economy Promotion of Deepen the value added value and of taking quality differentiation of as the core by strengthening products techniques Automation and Digitalization Designing function- and Introduction of Industry 4.0 and eco-oriented products AI into intelligent manufacture

Automation and Digitalization Introduction of Industry 4.0 and AI into intelligent manufacture & Homogenization of product quality of 5 Plants in 3 countries

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— Operation Orientation

Equity Co-investment into Schoeller Textil AG

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• Subscription of 50% Schoeller Textil AG’s shares with CHF$ 39.58 million (about NT$ 1.23 billion)

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• Movement from FTC’s acquisition of authority of technology and manufacture towards collaboration between two parties of overall innovation, R&D, technology and manufacture

• Developed products

Expanded Corporation between FTC and Schoeller Textil AG in 2020

• Functional textile : Sports, outdoors, daily-life

• Protective textile : The police/military

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Set up Schoeller F.T.C. (Hong Kong) Co., Ltd. with Schoeller in 2001

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Deployment of Textile Products
Chang-Shu
Switzerland
Zhong-Shan Douliu
Long- An
Dong-Nai
Taiwan China Vietnam
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Switzerland

1. Logistics Platform 1. Advantages of China’s 1. Generalized System of Preferences (GSP) internal trade

2. Preferential Tariff Scheme for RCEP

3. R&D Center

4. Preferential Tariff

5. Advantageous Locations—located in the hub of Global Textile Industry Cluster — Maximized Benefits of Local-to-local Supply Chain

Scheme for RCEP

1. Movement from FTC’s acquisition of authority of technology and manufacture towards collaboration between two parties of overall innovation, R&D, technology and manufacture

2. New Development on Technology, Leading position on the Brand

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Operation Orientation

 To carry out the corporate social responsibility, emphasize environmental protection and strive for sustainable development

Plant	Effectiveness of Completed Conservation Projects	Effectiveness of Completed Conservation Projects	Effectiveness of Completed Conservation Projects	Effectiveness of Completed Conservation Projects	Effectiveness of Completed Conservation Projects	Effectiveness of Completed Conservation Projects
	Conserved Steam (MT/HR)	Conserved Water (MT/Day)	Conserved Electricity (KW)	Conserved Fuel (KG/HR)	Reduced Emissions of CO2 (Tons/Year)	Accumulated Amount (Thousands of NTD/Year)
Taiwan Plant	5.74	2156.45	290.47	0.00	20,286.3	51,005.0
Zhong- Shan Plant	0.33	0.0	30.15	0.00	1,283.7	3,064.8
Chang- Shu Plant	0.20	0.1	4.11	0.068	660.21	1,488.62
Long-an Plant	1.30	25.29	142.43	85.35	14,521.0	42.541.5
Dong-nai Plant	7.79	1,876.8	144.06	0.00	25,539.0	69,059.0
Total	15.36	5,058.54	611.21	85.42	62,290.4	167,159.0

Data above the table collected from Jan. to Sep., 2020.

• Formosa Taffeta Co., Ltd participated in the climate change and water security question of CDP and was namely awarded “A-” and “A” (Leadership) in 2020.

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Q&A