NPC — Interim / Quarterly Report 2020

Aug 26, 2020

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Nan Ya Plastics Year 2020 1H Operations & Performance

Aug. 2020

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Agenda

• Overview

• Financial Highlights

• Capacity Expansion Plan

• Q & A

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Overview Highlights

• Market Capitalization NT$ 484.6 billion (Jul. 2020)

• The 10th largest company in Taiwan in terms of market capitalization

• NT$ 286.3 billion

• (Y2019, not include Nanya Tech. Co.)

• Sales breakdown

Sales

Revenue

• -15% in plastics

• -25% in chemicals

• -39% in electronics

• -19% in polyesters

Market Capitalization

• Total number of

• Plants 102

Worldwide

• -59 in Taiwan

Distribution

• -36 in China

• -7 in US

• Number of Employees 31,899

(The number of Plants and Employees includes the consolidated financial reporting company)

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Overview

Leading market positions for capacity

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1 2 3 4
 Plastics processing  Copper foil  Copper clad  EG
 Epoxy resin  PA laminate  BPA
 Glass yarn
 Glass fabrics
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※Plasticizer products ranked 5[th] Polyester products ranked 11[th]

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Overview History

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Nan Ya USA Chemicals Plastics Processing &America Co. Nanya Tech Co.  Texas  Louisiana 1958 1979 1995 1999  South Carolina Electronics Investing in  Xiamen  Guangzhou Polyesters & Nan Ya PCB Co. China  Nantong  Huizhou 1969 1986 1996  Kunshan  Ningbo

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Overview Major Businesses

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15%

Plastics

PVC Sheeting, PVC Rigid Film, PU Leather, PVC Rigid Pipe & Fittings, Window & Door Frames, Films, Engineering and PVC Compounds, PP Synthetic Paper Taiwan China & Others USA 11% 60% 29%	PVC Sheeting, PVC Rigid Film, PU Leather, PVC Rigid Pipe & Fittings, Window & Door Frames, Films, Engineering and PVC Compounds, PP Synthetic Paper Taiwan China & Others USA 11% 60% 29%	PVC Sheeting, PVC Rigid Film, PU Leather, PVC Rigid Pipe & Fittings, Window & Door Frames, Films, Engineering and PVC Compounds, PP Synthetic Paper Taiwan China & Others USA 11% 60% 29%

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25%

Chemicals

EG, BPA, 1,4BG, Plasticizer, PA, 2EH, INA, MA		Taiwan China USA 5% 85% 10%

Sales breakdown in 2019 Electronics 39%

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Glass Yarn, Glass Fabrics, Epoxy Resin, Copper Foil, China 58% Copper Clad Laminate, Printed Circuit Board Taiwan 42%

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19%

Polyesters

China & Others 5% Polyester Staple Fiber, PET Resin, Filament, USA 49% PET Film Taiwan 46%

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Financial Highlights Consolidated Revenue (IFRS)

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(NT$ billion )
333.1
400
286.3
300
142.8
126.2
200
100
0
2018 2019 2019 1H 2020 1H
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 Revenue in 2019 decreased 14.0% YoY due to:

Under the circumstance that the market supply increased or remained steady, the product price facing strict competition, causing the revenue to decrease. Revenue of chemical products like EG and BPA dropped the most, and polyesters also had a decline.

 Revenue in 2020 1H decreased 11.6% YoY due to :

Price of products slipped while the coronavirus pandemic affected operation of all industries and crude oil price dropped resulted in the overall revenue decrease.

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Financial Highlights Pre-tax Income

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(NT$ billion )
61.53
80
60
26.69
40
12.77
4.99
20
0
2018 2019 2019 1H 2020 1H
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 2019 pre-tax income decreased 56.6% YoY due to ：

1. The decrease came mainly from chemical product (EG and BPA the most). Electronic materials, polyester products and plastics products declined as well.

2. Equity income decreased NT$14.3bn YoY :

   • (1) FPCC -NT$5.4bn (2) Nanya Tech -NT$8.7bn

3. 2020 1H pre-tax income decreased 60.9% YoY due to ：

4. Operating profit increased NT$1.6bn mainly due to electronic material products benefited from 5G construction, leading a significant increase in profit.

5. Equity income decreased NT$8.1bn YoY :

   • (1) FPCC -NT$8.3bn (2) Nanya Tech -NT$0.4bn

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Financial Highlights Revenue Breakdown

2019 Sales Breakdown by Geography

2019 Net Sales NT$ 286.3 billion

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Others 1.5%
Others 3.7%
Plastics EU 2.2%
14.9%
Other Aisa
13.3%
China
Electronics 39.0%
39.2%
Polyesters
America
19.3%
13.0%
Chemicals Domestic
25.2% 28.8%
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• Under the circumstance that the market supply increased or remained steady, the product price facing strict competition, causing the revenue to decrease. Revenue of chemical products dropped the most, and polyesters also had a decline.

• Revenue in the next few years is still mainly driven by chemicals product and electronic materials.

• Mainland China remains the most important market, accounting for 55% of total overseas in 2019.

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Financial Highlights Revenue Breakdown by Product Segment

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2019 1H Net Sales 2020 1H Net Sales
NT$ 142.8 billion NT$ 126.2 billion
Others
Others 1.4%
1.6%
Plastics
Plastics
14.9%
14.9%
Electronics
36.9%
Electronics
42.4%
Polyesters
Polyesters 16.4%
20.3%
Chemicals
Chemicals
24.9%
26.3%
 Price of products slipped while the coronavirus pandemic affected operation of
all industries and crude oil price dropped resulted in the overall revenue
decrease.
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• The proportion of electronic products increased, while the proportion of chemical and polyester products decreased, showing the changes in industry trends.

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Financial Highlights Operating Profits Breakdown by Product Segment

Operating Profits -100.0% -50.0% 0.0% 50.0% 100.0% 150.0% 200.0% 2Q19 3Q19 4Q19 1Q20 2Q20 59.6% 95.4% 76.3% 70.3% 86.3% -17.4% -55.4% -19.9% -10.5% -12.0% 22.4% 16.5% 12.3% 9.2% -3.8% 36.0% 33.5% 21.5% 20.1% 23.6% -0.6% 10.0% 9.8% 10.9% 6.0% Electronics Chemicals Polyesters Plastics Others -8.0% -6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0%				Operating Margins 6.4% 8.5% 7.7% 10.5% -6.3% -3.8% -1.8% -2.8% 2.4% 3.2% 2.2% -1.5% 6.2% 6.7% 6.2% 8.2% 3Q19 4Q19 1Q20 2Q20 Electronics Chemicals Polyesters Plastics
		4.9% 3.5% 7.6%		6.4% 8.5% 7.7% 10.5% 2.4% 3.2% 2.2% 6.2% 6.7% 6.2% 8.2%
			5%	2.4% 3.2% 2.2%
		-2.3%	.3%	-3.8% -1.8% -2 -
	2Q19

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Business Overview Capacity Expansion Plan

Area	Product	Unit	Annual Capacity	Annual Capacity	Annual Capacity	Completion Date
			**Current **	**Expansion **	Increase%
Taiwan	PPSynthetic Paper	KMT	65	22	34	2020/10
	Long Fiber-Reinforced Thermoplastics	KMT	0	5	100	2021/1
	Copper Foil	KMT	34	18	53	2021/1
	Polyester Film	KMT	94	14	15	2020/12
	Polyester Release Film (4thcoatingmachine )	KM2	240,000	120,000	50	2020/11
	Polyester Release Film (5th set)	KM2	240,000	123,600	52	2021/1
Mainland China	PVC Leather	KYD	34,200	9,000	26	2020/12
	Aluminum LaminatedFoil	KM2	0	13,536	100	2020/12
	PVCDecorativeFilm	KYD	24,000	19,200	80	2021/9
	CopperCladLaminate	KSH	12,000	13,200	110	2021/12
	Prepreg	KM	24,000	28,800	120	2021/12
	GlassFabrics	KM	0	117,000	100	2021/9
	PCB	KSF	17,304	271	2	2021/2
	BPA	KMT	130	130	100	2021/10
USA	FlexiblePVC Sheeting	KMT	0	14	100	2021/11
	EG	KMT	360	828	230	2020/12

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THE END

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