OPC — Investor Presentation 2022

Aug 29, 2022

OCEAN PLASTICS CO., LTD.
2022 Institutional Investor Conference
Reporter: Spokesman Wang Yi-Ho
August 29, 2022

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Notes:

Briefing Outline

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Notes:

Company Organization

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Main Products

| | Plastic Processing Unit | Building Materials Unit | PU Unit | PVC Raw Materials Unit |
| --- | --- | --- | --- | --- |
| Product Category | Transparent tape, general tape, rigid sheet and film, printing tape, cellwood | PVC plastic pipe, high impact resistant tube, CD flexible tube, impact resistant plate, foam pellets, plastic wood, composite materials, PVC angle section | Water-based PU synthetic leather, solvent-free PPU synthetic leather, Water-based PU resin Solvent-free PPU, resin Textile environmentally friendly processing resin | Plastic powder, plastic pellets, environmental-protection plastic pellets, medical plastic pellets |
| Important Use | file folder for stationery, advertising and trademarks, building materials tape, medical grade tents, quarantine station curtains, bathroom floor, landscape table | electrical water supply piping, Tap water, health sewer works, plastic products injection, indoor and outdoor landscape use | High foam, trademarks, sports equipment, balls, clothing, furniture and electronic related products (earphone cover, tablet cover), etc. | Plastic sheets, plastic pipe, profiled extrusion paint, ink and other raw materials, IC encapsulated tube, thick transparent tube |
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Operation Situation of ? Plastic Processing Unit in 2022

| First half Operation Review | Second half Operating Outlook |
| --- | --- |
|  In February last year, the petrochemical plant in Texas, US shut down, and the skyrocketing price of feed stocks continued until the first half of this year. In addition, factors such as the continuation of the new crown epidemic and the blockade of ports of entry have led to delays in delivery, increased inventories, and backlogs of funds. While these unfavorable factors are still affecting the subsequent orders and delivery, the Russian-Ukrainian war in February this year kept high raw material costs and high freight rates for several more months and led to international inflation. In the first half of the year, the price of tape remained relatively high. In addition, Shanghai, China was closed due to the epidemic in March and the company signed a new shipping contract, which effectively secured shipping space. From March to June, more inventory was removed, and the overall sales amount of tape increased by about 34% compared with the same period last year. |  In the second half of the year, our products will focus on colored tape, including stationery, building materials and decoration, medical materials, and exhibition advertisements, so as to maintain the sales of the first half of the year; as for the transparent tape, it needs to strengthen the development of customers, including printing electrostatic film, fire resistant transparent adhesive cloth for mining; However, because of it needs to be re-certified by customers, it is not possible to achieve immediate results in terms of time and effectiveness. Moreover, the 25 percent import tariff imposed by the United States on China expires on July 6, and the two parties in the United States have different opinions. With severe inflation high and customers staying on the sidelines, international stability is needed to sustain sales in the second half of the year. |
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Operation Situation of ? Building Materials Unit in 2022

| First half Operation Review | Second half Operating Outlook |
| --- | --- |
|  At the beginning of the year, the Russian-Ukrainian war triggered a surge in international prices, which also prompted the prices of raw materials to continue to rise, and private investment and public works construction were still able to continue the booming situation of last year; however, the outbreak of the domestic epidemic in the second quarter reduced the public's spending behavior outside the home, laying a hidden worry of curbing domestic consumption. At the same time, in order to curb inflation, our country has adopted a strategy of raising interest rates, and in order to deal with the problem of high housing prices, it has also taken some measures to speculate on real estate, resulting in a gradual slowdown in the growth of the building materials consumer market. | Given that the impact of the local epidemic is slowing down, global coexistence with the epidemic has become the norm, and the government continues to loosen border controls, which will help stimulate domestic demand. However, the housing market is still affected by interest rate hikes and labor shortages, and construction costs are still high, causing a slowdown in construction progress and even affecting the willingness to start construction, so the growth of the economy in the second half of the year is slow. |
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Operation Situation of ? PU Unit in 2022

| First half Operation Review | Second half Operating Outlook |
| --- | --- |
| The sharp rise in raw material prices in the second quarter of 2021 caused sales difficulties in the second half of the year, so the sales product structure was adjusted in the first half of the year. However, the outbreak of the Ukrainian-Russian war in February 2022, the shortage of materials affected the order intake after February. However, after May, the high value-added and high-quality orders that we have been working on for years were accepted by the brand names and many orders were placed, such as high-foam, trademark, etc., and the order intake situation improved greatly from June onwards. Develop new products with high additional functions such as raw materials and resins with new functions. |  Since OPC’s environmental protection products have been accepted by famous brands, OPC will strives for good quality and smooth delivery, continues to develop new items to get rid of subsequent competitors, and expands new order sources. |
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Operation Situation of ? PVC Raw Materials Unit in 2022

| First half Operation Review | Second half Operating Outlook |
| --- | --- |
| Sales of PVC powder in the first half of the year were higher than the same period last year in terms of both volume and value, but the profit was not as profitable as expected because the price of raw materials was higher than the increase in PVC powder. The sales of plastic pellets decreased due to the delay of orders to China as a result of the city closure in China, but overall, the sales were still higher than the same period last year. | Due to the impact of the epidemic and the Ukrainian-Russian war is not over, , PVC powder market has a stagnant wait-and-see atmosphere and orders are expected to decrease in the second half of the year. However, with the support of fixed contract customers, the decrease is not expected to be too great. It is expected that the mainland market will not be closed for a long period of time, and the plastic pellet market should return to normal. |
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Business Performance? The last two years’ revenue by product category

Unit: NTD10,000

Chart: 2021year

Category	110年度	百分比
塑膠布	81982.0	0.12631407031691763
PU合成皮	16475.0	0.025383917304667138
塑膠管、板	82786.0	0.1275528362964595
塑膠粉、粒	458375.0	0.7062429799409269
其他類	9415.0	0.014506196141028268

Chart: 2020year

Category	109年度	百分比
塑膠布	132756.0	0.26657724266167604
PU合成皮	5165.0	0.010371444291388403
塑膠管、板	60938.0	0.1223649704218061
塑膠粉、粒	290460.0	0.5832506696760246
其他類	8683.0	0.01743567294910462

Business Performance ? Consolidated revenue for the last five years

Unit: NTD1,000,000

[unsupported chart]

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Business Performance?   Consolidated income statement

Unit: NTD1,000
| | 2021(1~6) | 2022(1~6) | Increased (reduced) amount | Change % |
| --- | --- | --- | --- | --- |
| Net Operating Revenue | 3,185,808 | 3,722,699 | 536,891 | 16.85% |
| Cost of Goods Sold or Manufacturing Costs | 2,961,172 | 3,446,154 | 484,982 | 16.38% |
| Gross Profit | 224,636 | 276,545 | 51,909 | 23.11% |
| Operating Expenses | 234,523 | 313,984 | 79,461 | 33.88% |
| Operating Income (loss) | -9,887 | -37,439 | -27,552 | 278.67% |
| Non-operating Expense or Loss | 203,303 | 36,939 | -166,364 | -81.83% |
| Profit (loss) from continuing operations before tax | 193,416 | -6,694 | -200,110 | -103.46% |
| Income Tax Expense | 1,088 | 4,212 | 3,124 | 287.13% |
| Profit (loss) from continuing operations | 192,328 | -10,906 | -203,234 | -105.67% |
| Profit (loss) from discontinued operations, net of tax | - | | | |
| Net Income(net loss) | 192,328 | -10,906 | -203,234 | -105.67% |
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Reinvestment Benefits

1. CHUN PIN ENTERPRISE CO., LTD.: The main business is warehousing and logistics.
2. Taiwan VCM Corporation: The main business is VCM raw materials trading .
3. Fuzetec Technology Co., Ltd. : The main products are resettable compound fuse, customized products.
4. E'DALE TECHNOLOGY CO., LTD. : The main products are epoxy resin materials for electronic product packaging and epoxy resin materials for IC packaging.
There are stable dividend income from above re-investment companies every year.
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In Line with International Standards

The Company has completed its 2021 ESG Report in 2022/June。
1. The report spontaneously complies with the relevant norms and convention disclosure.
2. Gradually practice SDGs objectives and gradually implement GRI specifications.
3. Implement TCFD related countermeasures.
4. Promote greenhouse gas inventory.
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Activating Assets–
Zhonghe Land Development Case

The rezoning of the public works is already completed.
Has signed the co-construction contract with Kingdom Construction Corp.; the development project is currently in urban design review stage carried out in the city government. Construction is expected to start in first quarter of next year
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Notes:

End of this report?Thanks

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