S.C.P.C - AGM Information 2016 | FinancialReports.eu

Stock Code: 1720

Standard Chem. & Pharm. Co., Ltd.

Handbook for the 2016 Annual Meeting of Shareholders

MEETING TIME: June 17, 2016

----Disclaimer----

THIS IS A TRANSLATION OF THE AGENDA FOR THE 2016 ANNUAL SHAREHOLDERS’ MEETING (“THE AGENDA) OF STANDARD CHEM. & PHARM. CO., LTD (“THE COMPANY”). THE TRANSLATION IS INTEDED FOR REFERENCE ONLY AND NOT FOR OTHER PURPOSE. THE COMPANY HEREBY DISCLAIMS ANY AND ALL LIABILITIES WHATSOEVER FOR THE TRANSLATION. THE CHINESE TEXT OF THE AGENDA SHALL GOVERN ANY AND ALL MATTERS RELATED TO THE INTERPRETAION OF THE SUBJET MATTER STATED HEREIN.

I.	Meeting Procedure	1
II.	Meeting Agenda	2
III.	Proposal and Discussion (I)	3
IV.	Company Reports	7
V.	Proposals and Approvals	11
VI.	Proposal and Discussion (II)	13
VII	Question and Motions	14
Attachments
1.	Business Report	15
2.	Independent Auditors’ Report and 2015 Financial Statements	18
Appendices
	Shareholding of Directors and Supervisors	35

I. Meeting Procedure

Standard Chem. & Pharm. Co., Ltd.

Procedure for the 2016 Annual Meeting of Shareholders

Call the Meeting to Order
Chairperson Takes Chair
Introduction
Chairperson Remarks
Proposal and Discussion (I)
Company Reports
Proposals and Approvals
Proposal and Discussion (II)
Question and Motions

10.Adjournment

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II. Meeting Agenda

Agenda of Annual Meeting of Shareholders

Time: 9:00 a.m. on Friday, June 17, 2016,

Place: Standard Chem. & Pharm. Co., Ltd.’s Conference Hall, No. 154, Kaiyuan Rd., Tuku Village, Sinying District, Tainan City.

Call the Meeting to Order
Chairperson Remarks
Proposal and Discussion (I)

Amendment to the Company's Corporate Charter

Company Reports
(1)2015 Business Report
(2)Supervisors’ Review Report on the 2015 Financial Results
(3)2015 Annual Report on Remuneration of Employees , Directors and Supervisors
(4)The Status of Endorsement and Guarantee
(5)The Status of Implementation of Investment in Mainland China
(6)Other Reports
Proposals and Approvals
(1)Adoption of the 2015 Business Report and Financial Statements
(2)Adoption of the Proposal for Distribution of 2015 Profits
Proposal and Discussion (II)

Proposal for Distribution of Additional Paid-in Capital

Questions and Motions
Adjournments

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III. Proposal and Discussion (I)

(Proposed in the meeting of shareholders)

Proposal:(Proposed by the Board)

Propose and discuss Amendment to the Company Corporate Charter. Explanation:

(1) For purpose of Hua-Zong-(1)-Yi-Zi No. 10400058161, it is proposed to amend part of the Company’s Corporate Charter, in order to comply with relevant provisions of Article 235 and Article 235-1 of the Company Act apply.
(2) In order to comply with relevant provisions of the Law, the company hereby proposes to amend part of the Company’s Corporate Charter. Please refer to the following table for details.

Revised Provision	Original Provision	Explanation
Article 26 The company shall distribute surplus profit, after covering the loss, in accordance with the following methods: 1. Withdraw 1%~10% of the distribution as employee’s remuneration. 2. Withdraw no more than 3% of the distribution as the board’s remuneration. Employee bonus sharing must be distributed in stock or cash for qualifying employees. The board’s remuneration can only be distributed in cash. The distribution of employee and the board’s remuneration should be proposed in the shareholders meeting by the Remuneration Committee, approved by more than half of the board members along with two thirds those in attendance. Furthermore, any resolution shall be reported.		For purpose of amending to relevant law

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Revised Provision	Original Provision	Explanation
Article 26-1 The industrial environment of the company is constantly changing, and the Enterprise Life Cycle is steadily growing. Therefore, by taking into account the company’s future needs of investment, long-term financial plan, and fulfillment of the shareholders’ needs in cash, the company shall make distribution of surplus profit in the following order: 1. Pay taxes 2. Cover any loss 3. Set 10% as legal reserve 4. Set special reserve in accordance of the law 5. The shareholders’ bonus shallnot be less than 10% of the total amount of the net remainder and the accumulated undistributed earnings from the previous year.The cash dividends shall not be less than20% of the total dividends; however, if the par value of each share certificate is lower than 0.5 dollars, the bonus can be distributed with stock dividends upon approval by the board.	Article 26 The industrial environment of the company is constantly changing, and the Enterprise Life Cycle is steadily growing. Therefore, by taking into account the company’s future needs of investment, long-term financial plan, and fulfillment of the shareholders’ needs in cash, the company shall make distribution of surplus profit in the following order: 1. Pay taxes 2. Cover any loss 3. Set 10% as legal reserve 4. Set special reserve in accordance of the law ~~5. The employee’s bonus shall be 1% of~~ ~~the~~ ~~total~~ ~~amount~~ ~~of~~ ~~the~~ ~~net~~ ~~remainder after distributing from~~ ~~subparagraph 1 to subparagraph 4.~~ ~~6. The board’s bonus shall be 3% of the~~ ~~total amount of the net remainder~~ ~~after distributing from subparagraph~~ ~~1 to subparagraph 4.~~ 7. The shareholders’ bonus shallbe managed by the board to distribute the total amount of the net remainder and the accumulated undistributed earnings from previous year.The cash dividends shall not be less than1% of the total dividends; however, if the par value of each share certificate is lower than 0.5 dollars, the bonus can be distributed with stock dividends after being approved by the board.	1. Change of Article Number 2. Delete subparagraph 5 and 6 of paragraph 1, Article 26 3. Update subparagraph 7 to subparagraph 5, and amend the ratio of distribution.
	~~. ~~ ~~6~~
	~~. ~~ 7.

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Revised Provision	Original Provision	Explanation
Article 30 The Articles of Incorporation is made on June 8th, 56thyear of the Republic The 1stamendment is on April 25th, 57th year of the Republic The 2ndamendment is on March 30th, 59th year of the Republic The 3rdamendment is on March 23rd, 61th year of the Republic The 4thamendment is on November 30th, 69thyear of the Republic The 5thamendment is on August 20th, 71th year of the Republic The 6thamendment is on October 21st, 72thyear of the Republic The 7thamendment is on September 25th, 74thyear of the Republic The 8thamendment is on November 23th, 76thyear of the Republic The 9thamendment is on June 1st, 77th year of the Republic The 10thamendment is on September 20th, 78thyear of the Republic The 11thamendment is on October 5th, 79thyear of the Republic The 12thamendment is on October 19th, 80thyear of the Republic The 13thamendment is on October 9th, 81styear of the Republic The 14thamendment is on March 5th, 82nd year of the Republic The 15thamendment is on June 19th, 82nd year of the Republic The 16thamendment is on June 6th, 83rd year of the Republic The 17thamendment is on April 8th, 84th year of the Republic	Article 30 The Articles of Incorporation is made on June 8th, 56thyear of the Republic The 1stamendment is on April 25th, 57th year of the Republic The 2ndamendment is on March 30th, 59th year of the Republic The 3rdamendment is on March 23rd, 61th year of the Republic The 4thamendment is on November 30th, 69thyear of the Republic The 5thamendment is on August 20th, 71th year of the Republic The 6thamendment is on October 21st, 72thyear of the Republic The 7thamendment is on September 25th, 74thyear of the Republic The 8thamendment is on November 23th, 76thyear of the Republic The 9thamendment is on June 1st, 77th year of the Republic The 10thamendment is on September 20th, 78thyear of the Republic The 11thamendment is on October 5th, 79thyear of the Republic The 12thamendment is on October 19th, 80thyear of the Republic The 13thamendment is on October 9th, 81styear of the Republic The 14thamendment is on March 5th, 82nd year of the Republic The 15thamendment is on June 19th, 82nd year of the Republic The 16thamendment is on June 6th, 83rd year of the Republic The 17thamendment is on April 8th, 84th year of the Republic	Update the latest date of amendment

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Revised Provision	Original Provision	Explanation
The 18thamendment is on May 28th, 85th year of the Republic The 19thamendment is on May 22nd, 87th year of the Republic The 20thamendment is on May 26th, 89th year of the Republic The 21stamendment is on May 26th, 89th year of the Republic The 22ndamendment is on May 23rd, 90th year of the Republic The 23rdamendment is on May 29th, 91st year of the Republic The 24thamendment is on May 30th, 95th year of the Republic The 25thamendment is on June 17th, 97th year of the Republic The 26thamendment is on June 9th, 98th year of the Republic The 27thamendment is on June 9th, 99th year of the Republic The 28thamendment is on June 15th, 100th year of the Republic The 29thamendment is on June 6th, 101st year of the Republic The 30thamendment is on June 18th, 102nd year of the Republic The 31stamendment is on June 17th, 103rd year of the Republic The 32ndamendment is on June 17th, 105th year of the Republic	The 18thamendment is on May 28th, 85th year of the Republic The 19thamendment is on May 22nd, 87th year of the Republic The 20thamendment is on May 26th, 89th year of the Republic The 21stamendment is on May 26th, 89th year of the Republic The 22ndamendment is on May 23rd, 90th year of the Republic The 23rdamendment is on May 29th, 91st year of the Republic The 24thamendment is on May 30th, 95th year of the Republic The 25thamendment is on June 17th, 97th year of the Republic The 26thamendment is on June 9th, 98th year of the Republic The 27thamendment is on June 9th, 99th year of the Republic The 28thamendment is on June 15th, 100th year of the Republic The 29thamendment is on June 6th, 101st year of the Republic The 30thamendment is on June 18th, 102nd year of the Republic The 31stamendment is on June 17th, 103rd year of the Republic

Resolution:

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IV.Company Reports

(1) 2015 Business Reports

The result of overall operation for Standard Chem. & Pharm. Co., Ltd. and its subsidiaries’ (the Group) were summarized as follows:

Net Sales

Due to the effort of the Group, Net Sales for 2015 increased 0.8% in comparison with 2014.

Gross Profit

Due to cost control, product pricing, and portfolio adjustment, Gross Profit for 2015 rose by 3.3% in comparison with 2014.

Operating Income
Due to the increase of advertising expense, the operating income for 2015 increased 1.6% in comparison with 2014.
Non-operating Income
For non-operating income, the research income received NT$49 million; however, Foreign Exchange Gain and Share of Profit of Associates Accounted for using Equity Method resulted in a loss of NT$ 46 million. This caused the overall contribution of Non-Operating Income in 2015 decreasing by 1.3% when compared with 2014.

In summation of the above, Net Profit for 2015 was NT$368 million; representing

a 4.1% decrease over Net Income of 2014.

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(2) Supervisors’ review report on the 2015 financial statements

Supervisor’s Review Report

To Shareholders:

The Board of Directors has prepared Standard Chem. & Pharm. Co., Ltd. (SCP)’s 2015 Business report, parent and consolidated Financial Statements, and proposal of the surplus earning distribution. The CPA firm of PricewaterhouseCoopers Taiwan was retained to audit SCP’s Financial Statements and has issued an audit report relating to the Financial Statements. The Business Report and Financial Statements have been reviewed and determined to be correct and accurate by the Supervisor of SCP. According to Article 219 of the Company Act, I hereby submit this report.

Supervisor: Yuan-Feng, Kao

March 25, 2016

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Supervisor’s Review Report

To Shareholders:

Supervisor: Tsui-Wen, Yeh

March 25, 2016

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(3) 2015 Annual Report on Remuneration of employees , directors and supervisors The resolution was approved by the Board on March 25th, 2016.
i. 2015 annual employees’ remuneration is NT$ 4,232,845, the amount recognized is NT$ 4,290,563. The difference NT$ 57,718 is recognized as a gain in 2016.
ii. 2015 annual Board’s remuneration is NT$ 8,465,689, the amounts recognized is NT$ 8,581,126. The difference NT$ 115,437 is recognized as a gain in 2016.
iii. The above remuneration is distributed in cash.
(4) The Status of Endorsement and Guarantee
i. Based on the resolution made by the Board of Directors, the endorsements and guarantees provided by SCP to its subsidiary, Syngen Biotech Co., Ltd., have totaled NT$200,000,000. By the end of December 2015, none of the amount was actually used.
ii. Based on the resolution made by the Board of Directors, the endorsements and guarantees provided by SCP to its subsidiary, Standard Pharmaceutical Co., Ltd., have totaled US$3,000,000. By the end of December 2015, none of the amount was actually used.
(5) The Status of Implementation of Investment in Mainland China
i. SCP invested through Standard Pharmaceutical Co., Ltd. to Jiangsu Standard Biopharm Co., Ltd., a 100% owned subsidiary, located in Taizhou City of Jiangsu province in Mainland China. The total amount to be invested is US$9,000,000; the registered paid-in capital at the end of 2015 was US$8,000,000.
ii. SCP joint ventured through Jiangsu Standard Biopharm Co., Ltd. with a Japanese company to Jiangsu Standard-Dia Biopharm Co., Ltd., a 55% owned subsidiary. The registered paid-in capital at the end of 2015 was US$6,780,000.
(6) Other Reports
In accordance with Article 172-1 of the Company Act, the proposals submitted by shareholders shall be listed; no proposal is submitted in this shareholders’ meeting.

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V. Proposals and Approvals

1. Proposed by the Board

Proposal:

Adoption of the 2015 Business Report and Financial Statements.

Explanation:

The 2015 business report (Attachment 1 on page 15-17) and financial statements for year 2014 of SCP(Attachment 2 on page 18-34) have been approved by the Board and examined by the supervisors of SCP.

Resolution:

2. Proposed by the Board

Proposal:

Adoption of the Proposal for Distribution of 2015 Profits. Explanation:

a. Please refer to the 2015 PROFIT DISTRIBUTION TABLE below.
b. The distribution of cash dividends shall be based on the stock register record as shown on the distribution record date. It is proposed to distribute NT$1.0 per share, and the total dividend shall be rounded down to nearest NT$1.00, the remaining fraction will be adjusted by the Chairman of the Board, who is fully authorized by Board of Directors.
c. Subject to approval of the proposed distribution plan by the Shareholders’ Meeting, it is proposed that the Board of Directors be authorized to determine the dividend distribution date in order to make adjustment and distribution for each share based on the number of actual shares outstanding on the distribution date.

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Standard Chem. & Pharm. Co., Ltd. PROFIT DISTRIBUTION TABLE

Year 2015

	(Unit: NT$)
Item	Amount
After-tax net profit	347,893,441
Less: Legal reserve	(34,789,344)
Plus:Adjusted actuarial interest	33,221,231
Distributable profit from year 2015	346,325,328
Undistributed earnings from previous period	310,372,020
Accumulated undistributed earnings	656,697,348
Less: Dividend to shareholders (Cash dividend NT$1.00 per share)	(178,696,089)
Undistributed earnings as of the end of the period	478,001,259

Note 1: Earning distribution for this year shall be based on the distributable profit from year 2015.

Note 2: Actual cash dividend amount per share shall be calculated based on the stock register record shown on the distribution record date

Resolution:

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VI.Proposal and Discussion (II)

Proposed by the Board

Proposal:

Proposal for Distribution of Additional Paid-in Capital.

Explanation:

a. In accordance with Article 241 of the Company Act, it is proposed to distribute additional paid-in capital in excess of stock par value of NT$89,348,045 to shareholders (approximately NT$0.50 per share). The actual distribution rate of additional paid-in capital shall be calculated based on the stock register record as shown on the distribution record date. The calculation is rounded down to the nearest NT$1.00, the remaining fraction will be adjusted by Chairman of the Board, who is fully authorized by Board of Directors.
b. Subject to approval of the proposed distribution plan by the shareholders’ meeting, it is proposed that the Board of Directors be authorized to determine the distribution date in order to make adjustment and distribution for each share based on the number of actual shares outstanding on the distribution date.

Resolution:

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VII.Question and Motions VIII. Adjournments

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Attachments

Attachment 1:

Standard Chem. & Pharm. Co., Ltd. 2015 Business Report

Company Business Direction

Standard Chem. and Pharm. Co., Ltd. (SCP) has focused its operations on the development and manufacturing of pharmaceuticals. Through vertical integration of its corporate group and development of niche and brand differentiated specialty products, SCP seeks to build a global marketing network. To establish itself as a world-class pharmaceutical manufacturer, SCP strives to expand its presence in the United States, Japan, Europe, and other markets. SCP’s principal objectives for the year 2014 were:

a. Continue to expand R&D investments
b. Develop core technologies
c. Actively expand international operations
d. Strengthen internal management
Implementation Overview

Throughout 2015, SCP continued to invest in drug development, and the R&D budget for the year was NT$174,730 thousand. To expand international business, besides markets in Southeast Asian countries and China, SCP has submitted ANDAs to the US-FDA, bringing our generic formulations to the next stage of the international pharmaceutical market. Strengthening of internal management and operations was evident in proposal improvement, cost reductions, and process improvements of various ongoing projects.

Results of Business Plan Implementation

SCP’s Net Sales for 2015 were NT$2.2 billion a 1.5% decrease over 2014. Sales from pharmaceuticals for human-use (NT$1.9 billion) represented the largest contribution to overall Net Sales at 87%. Sales from Active Pharmaceutical Ingredients (NT$129 million) contributed 5.9% overall. Sales of health food (NT$94 million) contributed 4.2% overall. Other products, including veterinarian pharmaceuticals, had sales of NT$64 million contributing 2.9% overall.

Due to cost control, product pricing, and portfolio adjustments, Gross Profit for 2015 merely declined by 0.1% in comparison with 2014. Operating income, as a result of expense control, was 3% higher for 2015 when compared with that of 2014.

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For non-operating income and expense, the profit declined NT$17 million because SCP’s share of profit of associates accounted for using equity method declined.

In summation of the above, Net Income for 2015 was NT$347 million; representing a 7% decrease over Net Income of 2014.

Operation Summary

Unit: NTD thousand

	Unit: NTD thousand
Items	Amount
Net Sales	2,205,463
Gross Profit	1,005,836
Income from Operations	318,268
Non-operating Income/Expenses	92,145
Income Before Income Tax	410,413
Net Income	347,894
Basic Earnings per shares (NTD)	1.95

Budget Implementation

Unit: NTD thousand

Items	2015 Budget	2015 Actual	Achievement%
Net sales	2,240,000	2,205,463	98.5
Costs	1,219,904	1,199,627	98.3
Gross Profit	1,020,096	1,005,836	98.6
Operating exp.	659,982	687,568	104.2
Income from Operations	360,114	318,268	88.4
Pre-tax income	415,038	410,413	98.9

Profitability Analysis

rofitability Analysis
Items	Ratio(%)
Return on Total Assets	7.36
Return on Shareholders’ Equity	10.16
Operatingincome/paid-in capital ratio	17.81
Gain before tax/paid-in capital ratio	22.97
Net Margin	15.77
Basic Earnings per share (NTD)	1.95

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Research and Development

SCP’s R&D expenses for 2015 were NT$175 million, and SCP filed 16 pharmaceutical dossiers with the Taiwanese Food and Drug Administration, and received marketing approval for 12 previously submitted pharmaceutical formulations; as well submitted 1 application for Active Pharmaceutical Ingredient and received 1 approved certificate; for health food, 2 applications were submitted and 2 certificates were approved. Internationally, SCP submitted 15 items for review and received 3 approved items in Southeast Asia. Furthermore, in 2015 SCP launched 7 new products; initiated BA/BE studies on 6 products, and received passing results for 2 BA/BE studies. SCP continues its commitment to investment in R&D for new product development.

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Attachment 2:

REPORT OF INDEPENDENT ACCOUNTANTS TRANSLATED FROM CHINESE

To the Board of Directors and Shareholders of Standard Chem & Pharm. Co., Ltd.

We have audited the accompanying parent company only balance sheets of Standard Chem & Pharm. Co., Ltd. as of December 31, 2015 and 2014, and the related parent company only statements of comprehensive income, of changes in equity and of cash flows for the years then ended. These parent company only financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these parent company only financial statements based on our audits. For the share of profit or loss of associates and disclosures in Note 13 recognised by Standard Chem & Pharm. Co., Ltd.’s investment accounted for using equity method – WE CAN MEDICINES CO., LTD. for the years ended December 31, 2015 and 2014 were based on the investees’ reports audited by its appointed accountant. The share of loss of associates accounted for using equity method recognised based on reports audited by other independent accountant amounted to NTD (34,096) thousand and NTD (4,463) thousand for the years ended December 31, 2015 and 2014, respectively. The balance of related investment accounted for using equity method amounted to NTD 180,586 thousand and NTD 214,795 thousand as of December 31, 2015 and 2014, respectively.

We conducted our audits in accordance with the “Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants” and generally accepted auditing standards in the Republic of China. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits and the reports of the other independent accountants provide a reasonable basis for our opinion.

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In our opinion, based on our audits and the reports of other independent accountant, the parent company only financial statements referred to above present fairly, in all material respects, the financial position of Standard Chem & Pharm. Co., Ltd. as of December 31, 2015 and 2014, and its financial performance and cash flows for the years then ended, in conformity with the “Rules Governing the Preparation of Financial Statements by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission (FSC).

PricewaterhouseCoopers, Taiwan March 25, 2016

-------------------------------------------------------------------------------------------------------------------------------------------------

The accompanying financial statements are not intended to present the financial position and results of operations and cash
flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of
China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements
may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the
accompanying financial statements and report of independent accountants are not intended for use by those who are not
informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their
applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for
the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

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STANDARD CHEM. &PHARM. CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars)

Assets	December31,2015 AMOUNT % `$` `302,033` `6` `10,200` `-` `146,359` `3` `477,513` `10` `5,252` `-` `98,695` `2` `410,466` `9` `60,752` `1` `1,511,270` `31` `362,159` `8` `17,085` `-` `1,559,839` `32` `1,235,025` `25` `46,885` `1` `21,246` `1` `94,283` `2` `13,868` `-` `16,642` `-` `9,962` `-` `3,376,994` `69` `$` `4,888,264` `100`	December31,2014	December31,2014
	AMOUNT `$` `302,033` `10,200` `146,359` `477,513` `5,252` `98,695` `410,466` `60,752` `1,511,270` `362,159` `17,085` `1,559,839` `1,235,025` `46,885` `21,246` `94,283` `13,868` `16,642` `9,962` `3,376,994` `$` `4,888,264`	AMOUNT `$` `200,142` `15,056` `184,304` `403,449` `1,113` `95,609` `460,926` `49,522` `1,410,121` `291,732` `17,085` `1,444,971` `1,247,409` `46,997` `25,170` `87,914` `32,144` `8,005` `6,748` `3,208,175` `$` `4,618,296`	%
Current assets 1100 Cash and cash equivalents 1125 Available-for-sale financial assets - current 1150 Notes receivable, net 1170 Accounts receivable, net 1200 Other receivables 1210 Other receivables - related parties 130X Inventory 1410 Prepayments 11XX Total current assets Non-current assets 1523 Available-for-sale financial assets - non-current 1543 Financial assets carried at cost - non-current 1550 Investments accounted for using the equity method 1600 Property, plant and equipment 1760 Investment property, net 1780 Intangible assets 1840 Deferred income tax assets 1915 Prepayments for equipment 1920 Guarantee deposits paid 1990 Other non-current assets 15XX Total non-current assets 1XXX Total assets			`5` `-` `4` `9` `-` `2` `10` `1`
			`31`
			`6` `-` `31` `27` `1` `1` `2` `1` `-` `-`
			`69`
			`100`

(Continued)

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STANDARD CHEM. &PHARM. CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity	December31,2015 AMOUNT % `$` `80,000` `2` `100,000` `2` `137,483` `3` `32,683` `1` `62,635` `1` `202,405` `4` `50,610` `1` `63,111` `1` `100,000` `2` `828,927` `17` `-` `-` `62,607` `1` `446,814` `9` `5,293` `-` `514,714` `10` `1,343,641` `27` `1,786,961` `37` `335,467` `7` `479,790` `10` `691,487` `14` `250,918` `5` `3,544,623` `73` `$` `4,888,264` `100`	December31,2014	December31,2014
	AMOUNT `$` `80,000` `100,000` `137,483` `32,683` `62,635` `202,405` `50,610` `63,111` `100,000` `828,927` `-` `62,607` `446,814` `5,293` `514,714` `1,343,641` `1,786,961` `335,467` `479,790` `691,487` `250,918` `3,544,623` `$` `4,888,264`	AMOUNT `$` `50,000` `100,000` `171,476` `36,480` `56,354` `176,082` `35,086` `57,010` `-` `682,488` `100,000` `63,979` `466,244` `1,057` `631,280` `1,313,768` `1,786,961` `423,902` `442,366` `437,144` `214,155` `3,304,528` `$` `4,618,296`	%
Current liabilities 2100 Short-term borrowings 2110 Short-term notes and bills payable 2150 Notes payable 2160 Notes payable - related parties 2170 Accounts payable 2200 Other payables 2230 Current income tax liabilities 2310 Advance receipts 2320 Long-term liabilities, current portion 21XX Total current liabilities Non-current liabilities 2540 Long-term borrowings 2570 Deferred income tax liabilities 2640 Net defined benefit liability, non- current 2645 Guarantee deposits received 25XX Total non-current liabilities 2XXX Total liabilities Equity Share capital 3110 Common stock 3200 Capital surplus Retained earnings 3310 Legal reserve 3350 Unappropriated retained earnings 3400 Other equity interest Significant Contingent Liabilities and Unrecognised Contract Commitment 3XXX Total equity 3X2X Total liabilities and equity			`1` `2` `4` `1` `1` `4` `1` `1` `-`
			`15`
			`2` `1` `10` `-`
			`13`
			`28`
			`39` `9` `10` `10` `4`
			`72`
			`100`

The accompanying notes are an integral part of these financial statements. See report of independent accountants dated March 25, 2016.

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STANDARD CHEM. &PHARM. CO., LTD. PARENT COMPANY ONLY STATEMENTS OF INCOME FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars, except for earnings per share amount)

Items YearendedDecember31
2015
2014
Notes
AMOUNT
%
AMOUNT
%
7
$
2,205,463
100
$
2,238,079
100
6(5)(10)(21)(22), 7
and 9
(
1,199,627) (
54) (
1,230,865) (
55)
1,005,836
46
1,007,214
45
6(10)(21)(22), 7 and
9
(
351,920) (
16) (
334,983) (
15)

(
160,918) (
7) (
179,926) (
8)
(
174,730) (
8) (
183,196) (
8)
(
687,568) (
31) (
698,105) (
31)
318,268
15
309,109
14
6(9)(18) and 7
91,465
4
50,458
2
6(6)(19), 7 and 12
17,093
1
20,908
1
6(8)(20)
(
2,338)
-
(
2,807)
-
6(7)
(
14,075) (
1)
41,074
2
92,145
4
109,633
5
410,413
19
418,742
19
6(23)
(
62,519) (
3) (
44,507) (
2)
$
347,894
16
$
374,235
17
6(7)(14)
$
40,090
2
($
8,953)
-
6(23)
(
6,869)
-
1,360
-
6(7)
(
19)
-
10,655
-
6(2)(7)
36,782
1
70,224
3
$
69,984
3
$
73,286
3
$
417,878
19
$
447,521
20
6(24)
$
1.95
$
2.09
6(24)
$
1.95
$
2.09

4000
Sales revenue
5000
Operating costs
5900
Net operating margin
Operating expenses
6100
Selling expenses
6200
General and administrative expenses
6300
Research and development expenses
6000
Total operating expenses
6900
Operating profit
Non-operating income and expenses
7010
Other income
7020
Other gains and losses
7050
Finance costs
7070
Share of (loss) profit of associates
and joint ventures accounted for
using the equity method, net
7000
Total non-operating income and
expenses
7900
Profit before income tax
7950
Income tax expense
8200
Net income for the year
Other comprehensive income
Components of other comprehensive
income that will not be reclassified to
profit or loss
8311
Gain (loss) on remeasurement of
defined benefit plan
8349
Income tax related to components of
other comprehensive income that
will not be reclassified to profit or
loss
Components of other comprehensive
income that will be reclassified to
profit or loss
8361
Financial statements translation
differences of foreign operations
8362
Unrealised gain on valuation of
available-for-sale financial assets
8300
Total other comprehensive income for
the year
8500
Total comprehensive income for the
year
Basic earnings per share (in dollars)
9750
Net income for the year
Diluted earnings per share (in
dollars)
9850
Net income for the year

Items	YearendedDecember31 2015 2014 Notes AMOUNT % AMOUNT % 7 `$` `2,205,463` `100` `$` `2,238,079` `100` 6(5)(10)(21)(22), 7 and 9 `(` `1,199,627) (` `54) (` `1,230,865) (` `55)` `1,005,836` `46` `1,007,214` `45` 6(10)(21)(22), 7 and 9 `(` `351,920) (` `16) (` `334,983) (` `15)` `(` `160,918) (` `7) (` `179,926) (` `8)` `(` `174,730) (` `8) (` `183,196) (` `8)` `(` `687,568) (` `31) (` `698,105) (` `31)` `318,268` `15` `309,109` `14` 6(9)(18) and 7 `91,465` `4` `50,458` `2` 6(6)(19), 7 and 12 `17,093` `1` `20,908` `1` 6(8)(20) `(` `2,338)` `-` `(` `2,807)` `-` 6(7) `(` `14,075) (` `1)` `41,074` `2` `92,145` `4` `109,633` `5` `410,413` `19` `418,742` `19` 6(23) `(` `62,519) (` `3) (` `44,507) (` `2)` `$` `347,894` `16` `$` `374,235` `17` 6(7)(14) `$` `40,090` `2` `($` `8,953)` `-` 6(23) `(` `6,869)` `-` `1,360` `-` 6(7) `(` `19)` `-` `10,655` `-` 6(2)(7) `36,782` `1` `70,224` `3` `$` `69,984` `3` `$` `73,286` `3` `$` `417,878` `19` `$` `447,521` `20` 6(24) `$` `1.95` `$` `2.09` 6(24) `$` `1.95` `$` `2.09`
4000 Sales revenue 5000 Operating costs 5900 Net operating margin Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6300 Research and development expenses 6000 Total operating expenses 6900 Operating profit Non-operating income and expenses 7010 Other income 7020 Other gains and losses 7050 Finance costs 7070 Share of (loss) profit of associates and joint ventures accounted for using the equity method, net 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Income tax expense 8200 Net income for the year Other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss 8311 Gain (loss) on remeasurement of defined benefit plan 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8361 Financial statements translation differences of foreign operations 8362 Unrealised gain on valuation of available-for-sale financial assets 8300 Total other comprehensive income for the year 8500 Total comprehensive income for the year Basic earnings per share (in dollars) 9750 Net income for the year Diluted earnings per share (in dollars) 9850 Net income for the year

The accompanying notes are an integral part of these financial statements. See report of independent accountants dated March 25, 2016.

~22~

STANDARD CHEM. & PHARM. CO., LTD. PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars)

For the year ended December 31, 2014 Balance at January 1, 2014 Difference between the price for acquisition or disposal of subsidiaries and carrying amount Change in net equity of associates and joint ventures accounted for using the equity method Distribution of 2013 net income (Note): Legal reserve Cash dividends Net income for the year Other comprehensive income for the year Balance at December 31, 2014 For the year ended December 31, 2015 Balance at January 1, 2015 Cash dividends from capital surplus Difference between the price for acquisition or disposal of subsidiaries and carrying amount Distribution of 2014 net income (Note): Legal reserve Cash dividends Net income for the year Other comprehensive income for the year Balance at December 31, 2015	Notes		Common stock				CapitalSurplus				RetainedEarnings	RetainedEarnings		Other EquityInterest	Other EquityInterest	Other EquityInterest	Total equity
					Additional paid-in capital		Difference between the price for acquisition or disposal of subsidiaries and carrying amount		Change in net equity of associates and joint ventures accounted for using the equity method		Legal reserve	Unappropriated retained earnings		Financial statements translation differences of foreign operations		Unrealized gain or loss on valuation of available-for-sale financial assets
	6(7) 6(7) 6(17) 6(16) 6(7) 6(17)		`$ 1,786,961` `-` `-` `-` `-` `-` `-` `$ 1,786,961` `$ 1,786,961` `-` `-` `-` `-` `-` `-` `$ 1,786,961`	`$ 411,397` `-` `-` `-` `-` `-` `-` `$ 411,397` `$ 411,397` `(` `89,348` `)` `-` `-` `-` `-` `-` `$ 322,049`			`$` `-` `9,045` `-` `-` `-` `-` `-` `$` `9,045` `$` `9,045` `-` `913` `-` `-` `-` `-` `$` `9,958`		`$` `-` `-` `3,460` `-` `-` `-` `-` `$` `3,460` `$` `3,460` `-` `-` `-` `-` `-` `-` `$` `3,460`		`$ 412,527` `-` `-` `29,839` `-` `-` `-` `$ 442,366` `$ 442,366` `-` `-` `37,424` `-` `-` `-` `$ 479,790`	`$` `547,081` `-` `-` `(` `29,839 )` `(` `446,740 )` `374,235` `(` `7,593 )` `$` `437,144` `$` `437,144` `-` `-` `(` `37,424 )` `(` `89,348 )` `347,894` `33,221` `$` `691,487`	`$` `4,992` `-` `-` `-` `-` `-` `10,655` `$` `15,647` `$` `15,647` `-` `-` `-` `-` `-` `(` `19 )` `$` `15,628`			`$` `128,284` `-` `-` `-` `-` `-` `70,224` `$` `198,508` `$` `198,508` `-` `-` `-` `-` `-` `36,782` `$` `235,290`	`$ 3,291,242` `9,045` `3,460` `-` `(` `446,740 )` `374,235` `73,286` `$ 3,304,528` `$ 3,304,528` `(` `89,348 )` `913` `-` `(` `89,348 )` `347,894` `69,984` `$ 3,544,623`

(Note) The employees' bonuses were $3,070 and $3,292, and the directors' and supervisors' remuneration were $9,212 and $9,877 in 2013 and 2014, respectively, which had been deducted from net income for the years.

The accompanying notes are an integral part of these financial statements. See report of independent accountants dated March 25, 2016.

~23~

STANDARD CHEM. & PHARM. CO., LTD. PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax
Adjustments
Adjustments to reconcile profit (loss)
Gain on financial assets at fair value through profit or
loss
Provision for doubtful accounts
Reversal of allowance for doubtful accounts
Provision (Reversal of allowance) for loss on inventory
market price decline
Gain on disposal of financial assets carried at cost -
non-current
Share of loss (profit) of associates and joint ventures
accounted for using the equity method
Property, plant and equipment transferred to expense
Depreciation
Net loss on disposal of property, plant and equipment
Amortisation
Dividends income
Interest income
Interest expense
Changes in operating assets and liabilities
Changes in operating assets
Financial assets and liabilities at fair value through
profit or loss
Notes receivable
Accounts receivable
Other receivables
Other receivables - related parties
Inventories
Prepayments
Changes in operating liabilities
Notes payable
Notes payable - related parties
Accounts payable
Other payables
Advance receipts
Net defined benefit liability, non-current
Cash inflow generated from operations
Dividend received
Interest received
Interest paid
Income tax paid
Net cash flows from operating activities Notes
2015
2014
$
410,413
$
418,742
-
(
1,042 )
6(3)(4)
-
5,396
6(4)
(
105 )
-
6(5)
6,918
(
5,525 )
6(6)
-
(
788 )
6(7)
14,075
(
41,074 )
6(8)
-
1,423
6(8)(9)
115,008
107,288
6(19)
534
594
6(10)(21)
3,924
3,655
6(18)
(
10,539 ) (
7,145 )
6(18)
(
2,861 ) (
3,161 )
6(20)
2,338
2,807
-
1,431
37,945
29,632
(
73,959 ) (
18,704 )
(
4,139 )
2,570
454
1,049
43,542
(
70,222 )
(
11,230 )
56,665
(
31,010 )
16,618
(
3,797 )
19,720
6,281
8,250
14,837
(
16,323 )
6,101
23,527
20,977
13,091
545,707
548,474
28,576
20,556
2,861
3,161
(
2,338 ) (
2,807 )
(
61,605 ) (
38,878 )
513,201
530,506

(Continued)

~24~

STANDARD CHEM. & PHARM. CO., LTD. PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars)

	Notes			2015			2014
CASH FLOWS FROM INVESTING ACTIVITIES
Increase in available-for-sale financial assets		`($`		`35,910 )`	`($`		`32,226 )`
Increase in other receivables - related parties		`(`		`3,540 )`	`(`		`5,520 )`
Proceeds from liquidation of financial assets carried at cost				`-`			`788`
Acquisition of investments accounted for using the equity	6(7) and 7
method		`(`		`139,282 )`	`(`		`97,946 )`
Proceeds from disposal of investments accounted for using	6(7)
the equity method				`-`			`21,481`
Cash paid for acquisition of property, plant and equipment	6(25)	`(`		`49,225 )`	`(`		`45,130 )`
Interest paid for acquisition of property, plant and	6(8)(20)(25)
equipment		`(`		`244 )`	`(`		`269 )`
Proceeds from disposal of property, plant and equipment	7			`35`			`50,325`
Acquisition of intangible assets	6(10)			`-`	`(`		`3,016 )`
Increase in prepayments for equipment		`(`		`26,833 )`	`(`		`44,756 )`
(Increase) decrease in guarantee deposits paid		`(`		`8,637 )`			`3,556`
Increase in other non-current assets		`(`		`3,214 )`	`(`		`1,386 )`
Net cash flows used in investing activities		`(`		`266,850 )`	`(`		`154,099 )`
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term borrowings				`30,000`	`(`		`60,000 )`
Increase in short-term notes and bills payable				`-`			`40,000`
Increase in guarantee deposit received				`4,236`			`817`
Cash dividends from capital surplus	6(16)	`(`		`89,348 )`			`-`
Payment of cash dividends	6(17)	`(`		`89,348 )`	`(`		`446,740 )`
Net cash flows used in financing activities		`(`		`144,460 )`	`(`		`465,923 )`
Net increase (decrease) in cash and cash equivalents				`101,891`	`(`		`89,516 )`
Cash and cash equivalents at beginning of year	6(1)			`200,142`			`289,658`
Cash and cash equivalents at end of year	6(1)		`$`	`302,033`		`$`	`200,142`

~25~

REPORT OF INDEPENDENT ACCOUNTANTS TRANSLATED FROM CHINESE To the Board of Directors and Shareholders of Standard Chem & Pharm. Co., Ltd.

We have audited the accompanying consolidated balance sheets of Standard Chem & Pharm. Co., Ltd. and its subsidiaries as of December 31, 2015 and 2014, and the related consolidated statements of comprehensive income, of changes in equity and of cash flows for the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. For the share of profit or loss of associates and joint ventures and disclosures in Note 13 recognised by Standard Chem & Pharm. Co., Ltd. and its subsidiaries’ investment accounted for using equity method – WE CAN MEDICINES CO., LTD. and CNH TECHNOLOGIES, INC. for the years ended December 31, 2015 and 2014 were based on the investees’ reports audited by their appointed accountants. The share of profit (loss) of associates and joint ventures accounted for using equity method recognised based on reports audited by other independent accountants amounted to NTD (33,384) thousand and NTD (5,079) thousand for the years ended December 31, 2015 and 2014, respectively. The balance of related investment accounted for using equity method amounted to NTD 193,368 thousand and NTD 226,409 thousand as of December 31, 2015 and 2014, respectively.

~26~

In our opinion, based on our audits and the reports of other independent accountants, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Standard Chem & Pharm. Co., Ltd. and its subsidiaries as of December 31, 2015 and 2014, and their financial performance and cash flows for the years then ended, in conformity with the “Rules Governing the Preparation of Financial Statements by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission (FSC).

We have also audited the parent company only financial statements of Standard Chem & Pharm. Co., Ltd. as of and for the years ended December 31, 2015 and 2014, on which we have expressed a modified unqualified opinion on such financial statements.

PricewaterhouseCoopers, Taiwan March 25, 2016

------------------------------------------------------------------------------------------------------------------------------------------------The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and report of independent accountants are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

~27~

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars)

Assets	December 31, 2015 AMOUNT % `$` `766,379` `13` `159,920` `3` `10,200` `-` `290,651` `5` `598,699` `11` `7,406` `-` `649,536` `11` `120,813` `2` `2,603,604` `45` `414,039` `7` `30,651` `1` `193,490` `3` `2,186,890` `38` `134,512` `2` `102,654` `2` `31,388` `1` `19,162` `-` `5,383` `-` `59,019` `1` `14,495` `-` `3,191,683` `55` `$` `5,795,287` `100`	December 31, 2014	December 31, 2014
	AMOUNT `$` `766,379` `159,920` `10,200` `290,651` `598,699` `7,406` `649,536` `120,813` `2,603,604` `414,039` `30,651` `193,490` `2,186,890` `134,512` `102,654` `31,388` `19,162` `5,383` `59,019` `14,495` `3,191,683` `$` `5,795,287`	AMOUNT `$` `543,233` `164,537` `15,056` `293,075` `597,731` `3,540` `749,687` `84,457` `2,451,316` `335,031` `34,147` `226,614` `1,950,608` `145,910` `102,239` `45,385` `11,157` `3,349` `61,115` `7,776` `2,923,331` `$` `5,374,647`	%
Current assets 1100 Cash and cash equivalents 1110 Financial assets at fair value through profit or loss - current 1125 Available-for-sale financial assets - current 1150 Notes receivable, net 1170 Accounts receivable, net 1200 Other receivables 130X Inventory 1410 Prepayments 11XX Total current assets Non-current assets 1523 Available-for-sale financial assets - non-current 1543 Financial assets carried at cost - non-current 1550 Investments accounted for using the equity method 1600 Property, plant and equipment 1780 Intangible assets 1840 Deferred income tax assets 1915 Prepayments for equipment 1920 Guarantee deposits paid 1980 Other non-current financial assets 1985 Long-term prepaid rent 1990 Other non-current assets 15XX Total non-current assets 1XXX Total assets			`10` `3` `-` `6` `11` `-` `14` `2`
			`46`
			`6` `1` `4` `36` `3` `2` `1` `-` `-` `1` `-`
			`54`
			`100`

(Continued)

~28~

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity	December31,2015 AMOUNT % `$` `86,123` `1` `100,000` `2` `219,075` `4` `132,023` `2` `345,945` `6` `66,622` `1` `104,797` `2` `123,257` `2` `1,177,842` `20` `21,111` `1` `62,792` `1` `192,057` `3` `449,068` `8` `5,496` `-` `730,524` `13` `1,908,366` `33` `1,786,961` `31` `335,467` `6` `479,790` `8` `691,487` `12` `250,918` `4` `3,544,623` `61` `342,298` `6` `3,886,921` `67` `$` `5,795,287` `100`	December31,2014	December31,2014
	AMOUNT `$` `86,123` `100,000` `219,075` `132,023` `345,945` `66,622` `104,797` `123,257` `1,177,842` `21,111` `62,792` `192,057` `449,068` `5,496` `730,524` `1,908,366` `1,786,961` `335,467` `479,790` `691,487` `250,918` `3,544,623` `342,298` `3,886,921` `$` `5,795,287`	AMOUNT `$` `60,968` `109,990` `267,379` `101,449` `334,709` `47,179` `103,647` `28,000` `1,053,321` `180,750` `63,825` `-` `468,564` `2,435` `715,574` `1,768,895` `1,786,961` `423,902` `442,366` `437,144` `214,155` `3,304,528` `301,224` `3,605,752` `$` `5,374,647`	%
Current liabilities 2100 Short-term borrowings 2110 Short-term notes and bills payable 2150 Notes payable 2170 Accounts payable 2200 Other payables 2230 Current income tax liabilities 2310 Advance receipts 2320 Long-term liabilities, current portion 21XX Total current liabilities Non-current liabilities 2540 Long-term borrowings 2570 Deferred income tax liabilities 2610 Long-term notes and accounts payable 2640 Accrued pension liabilities 2645 Guarantee deposits received 25XX Total non-current liabilities 2XXX Total liabilities Equity attributable to owners of parent Share capital 3110 Common stock 3200 Capital surplus Retained earnings 3310 Legal reserve 3350 Unappropriated retained earnings 3400 Other equity interest 31XX Equity attributable to owners of the parent 36XX Non-controlling interest 3XXX Total equity Significant contingent liabilities and unrecognised contract commitments 3X2X Total liabilities and equity			`1` `2` `5` `2` `6` `1` `2` `1`
			`20`
			`3` `1` `-` `9` `-`
			`13`
			`33`
			`33` `8` `8` `8` `4`
			`61` `6`
			`67`
			`100`

The accompanying notes are an integral part of these consolidated financial statements. See report of independent accountants dated March 25, 2016.

~29~

`STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014`

(Expressed in thousands of New Taiwan dollars, except for earnings per share amount)

Items Year ended December 31
2015
2014
Notes
AMOUNT
%
AMOUNT
%
6(20) and 7
$
3,321,366
100
$
3,295,656
100
6(6)(10)(24)(25),
7 and 9
(
1,826,285)(
55)(
1,847,958)(
56)
1,495,081
45
1,447,698
44
6(10)(12)(24)(25
), 7 and 9
(
619,271)(
19)(
539,385)(
17)
(
253,343)(
7)(
288,219)(
9)
(
238,982)(
7)(
242,770)(
7)
(
1,111,596)(
33)(
1,070,374)(
33)
383,485
12
377,324
11
6(21)
112,987
3
67,654
2
6(2)(7)(10)(11)(2
2) and 12
4,761
-
25,130
1
6(9)(23)(28)
(
4,059)
- (
6,353)
-
6(8)
(
33,472)(
1)(
5,161)
-
80,217
2
81,270
3
463,702
14
458,594
14
6(26)
(
95,803)(
3)(
74,864)(
2)
$
367,899
11
$
383,730
12

4000
Sales revenue
5000
Operating costs
5900
Net operating margin
Operating expenses
6100
Selling expenses
6200
General and administrative
expenses
6300
Research and development
expenses
6000
Total operating expenses
6900
Operating profit
Non-operating income and
expenses
7010
Other income
7020
Other gains and losses
7050
Finance costs
7060
Share of (loss) profit of
associates and joint ventures
accounted for using the
equity method
7000
Total non-operating
income and expenses
7900
Profit before income tax
7950
Income tax expense
8200
Net income for the year

`Items`	`Year ended December 31` `2015` `2014` `Notes` `AMOUNT` `%` `AMOUNT` `%` `6(20) and 7` `$` `3,321,366` `100` `$` `3,295,656` `100` `6(6)(10)(24)(25),` `7 and 9` `(` `1,826,285)(` `55)(` `1,847,958)(` `56)` `1,495,081` `45` `1,447,698` `44` `6(10)(12)(24)(25` `), 7 and 9` `(` `619,271)(` `19)(` `539,385)(` `17)` `(` `253,343)(` `7)(` `288,219)(` `9)` `(` `238,982)(` `7)(` `242,770)(` `7)` `(` `1,111,596)(` `33)(` `1,070,374)(` `33)` `383,485` `12` `377,324` `11` `6(21)` `112,987` `3` `67,654` `2` `6(2)(7)(10)(11)(2` `2) and 12` `4,761` `-` `25,130` `1` `6(9)(23)(28)` `(` `4,059)` `- (` `6,353)` `-` `6(8)` `(` `33,472)(` `1)(` `5,161)` `-` `80,217` `2` `81,270` `3` `463,702` `14` `458,594` `14` `6(26)` `(` `95,803)(` `3)(` `74,864)(` `2)` `$` `367,899` `11` `$` `383,730` `12`
`4000` Sales revenue `5000` Operating costs `5900` Net operating margin Operating expenses `6100` `Selling expenses` `6200` `General and administrative` `expenses` `6300` `Research and development` `expenses` `6000` Total operating expenses `6900` Operating profit Non-operating income and expenses `7010` `Other income` `7020` `Other gains and losses` `7050` `Finance costs` `7060` `Share of (loss) profit of` `associates and joint ventures` `accounted for using the` `equity method` `7000` Total non-operating income and expenses `7900` Profit before income tax `7950` `Income tax expense` `8200` Net income for the year

(Continued)

~30~

`STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME`

`FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014`

(Expressed in thousands of New Taiwan dollars, except for earnings per share amount)

`Items`	`Year ended December 31`	`Year ended December 31`	`Year ended December 31`
	`2015`	`2014` `%` `AMOUNT` `1 ($` `5,850)` `-` `1,274` `-` `10,655` `1` `71,159` `2` `$` `77,238` `13` `$` `460,968` `10` `$` `374,235` `1` `9,495` `11` `$` `383,730` `12` `$` `447,521` `1` `13,447` `13` `$` `460,968` `1.95` `$` `1.95` `$`	`2014`
				`%`
Other comprehensive income (loss) Components of other comprehensive income that will not be reclassified to profit or loss `8311` `Gain (loss) on` `remeasurements of defined` `benefit plans` `8349` `Income tax related to` `components of other` `comprehensive income that` `will not be reclassified to` `profit or loss` Components of other comprehensive income that will be reclassified to profit or loss `8361` `Financial statements` `translation differences of` `foreign operation` `8362` `Unrealised gain on valuation` `of available-for-sale financial` `assets` `8300` Total other comprehensive income for the year `8500` Total comprehensive income for the year Profit attributable to: `8610` `Owners of the parent` `8620` `Non-controlling interest` Comprehensive income attributable to: `8710` `Owners of the parent` `8720` `Non-controlling interest` Basic earnings per share (in dollars) `9750` Net income for the year Diluted earnings per share (in dollars) `9850` Net income for the year				`-` `-` `-` `2`
				`2`
				`14`
				`12` `-`
				`12`
				`14` `-`
				`14`
				`2.09`
	`$`		`$`	`2.09`

The accompanying notes are an integral part of these consolidated financial statements.
See report of independent accountants dated March 25, 2016.

~31~

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014 (Expressed in thousands of New Taiwan dollars)

Notes					Equity attributable to owners ofthe parent	Equity attributable to owners ofthe parent	Equity attributable to owners ofthe parent					Non-controlling interest	Total equity
	Common stock			CapitalSurplus		RetainedEarnings			Other Equity	Interest Unrealised gain or loss on valuation of available- for-sale financial assets `$ 128,284` `-` `-` `-` `-` `-` `70,224` `-` `$ 198,508` `$ 198,508` `-` `-` `-` `-` `-` `36,782` `-` `$ 235,290`	Total
			Additional paid-in capital	Difference between the price for acquisition or disposal of subsidiaries and carrying amount	Change in net equity of associates and joint ventures accounted for using the equitymethod	Legal reserve	Unappropriated retained earnings		Financial statements translation differences of foreign operations
6(8) 6(19) 6(18) 6(19)	`$ 1,786,961` `-` `-` `-` `-` `-` `-` `-` `$ 1,786,961` `$ 1,786,961` `-` `-` `-` `-` `-` `-` `-` `$ 1,786,961`	`$ 411,397` `-` `-` `-` `-` `-` `-` `-` `$ 411,397` `$ 411,397` `(` `89,348` `)` `-` `-` `-` `-` `-` `-` `$ 322,049`		`$` `-` `9,045` `-` `-` `-` `-` `-` `-` `$` `9,045` `$` `9,045` `-` `913` `-` `-` `-` `-` `-` `$` `9,958`	`$` `-` `-` `3,460` `-` `-` `-` `-` `-` `$` `3,460` `$` `3,460` `-` `-` `-` `-` `-` `-` `-` `$` `3,460`	`$ 412,527` `-` `-` `29,839` `-` `-` `-` `-` `$ 442,366` `$ 442,366` `-` `-` `37,424` `-` `-` `-` `-` `$ 479,790`	`$` `547,081` `-` `-` `(` `29,839 )` `(` `446,740 )` `374,235` `(` `7,593 )` `-` `$` `437,144` `$` `437,144` `-` `-` `(` `37,424 )` `(` `89,348 )` `347,894` `33,221` `-` `$` `691,487`	`$` `4,992` `-` `-` `-` `-` `-` `10,655` `-` `$` `15,647` `$` `15,647` `-` `-` `-` `-` `-` `(` `19 )` `-` `$` `15,628`			`$ 3,291,242` `9,045` `3,460` `-` `(` `446,740` `)` `374,235` `73,286` `-` `$ 3,304,528` `$ 3,304,528` `(` `89,348` `)` `913` `-` `(` `89,348` `)` `347,894` `69,984` `-` `$ 3,544,623`	`$` `291,215` `-` `-` `-` `-` `9,495` `3,952` `(` `3,438 )` `$` `301,224` `$` `301,224` `-` `-` `-` `-` `20,005` `1,513` `19,556` `$` `342,298`	`$ 3,582,457` `9,045` `3,460` `-` `(` `446,740 )` `383,730` `77,238` `(` `3,438 )` `$ 3,605,752` `$ 3,605,752` `(` `89,348 )` `913` `-` `(` `89,348 )` `367,899` `71,497` `19,556` `$ 3,886,921`

The accompanying notes are an integral part of these consolidated financial statements. See report of independent accountants dated March 25, 2016.

~32~

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax
Adjustments
Adjustments to reconcile profit (loss)
Loss (gain) on financial assets at fair value through
profit and loss
Provision for doubtful accounts
Reveral of allowance for doubtful accounts
Provision for inventory market price decline
Gain on disposal of financial assets carried at cost -
non-current
Share of profit of associates and joint ventures
accounted for using the equity method
Property, plant and equipment transferred to expense
Depreciation
Net loss on disposal of property, plant and equipment
Amortisation
Impairment loss
Amortisation of long-term prepaid rent
Dividend income
Interest income
Interest expense
Changes in operating assets and liabilities
Changes in operating assets
Financial assets and liabilities at fair value through
profit or loss
Notes receivable
Accounts receivable
Other receivables
Inventories
Prepayments
Other non-current assets
Changes in operating liabilities
Notes payable
Accounts payable
Other payables
Advance receipts
Accrued pension liabilities
Cash inflow generated from operations
Dividend received
Interest received
Interest paid
Income tax paid
Net cash flows from operating activities Notes
2015
2014
$
463,702
$
458,594
449
(
1,630 )
6(4)(5)
-
10,178
6(4)(5)
(
3,180 )
-
6(6)
20,084
9,553
6(7)
-
(
788 )
6(8)
33,472
5,161
6(9)
1,722
1,423
6(9)(24)
156,877
146,124
6(22)
178
610
6(10)(24)
8,187
6,438
6(10)(11)
4,493
2,630
6(12)
1,316
1,281
6(21)
(
12,361 ) (
7,186 )
6(21)
(
2,619 ) (
3,946 )
6(23)
4,059
6,353
4,168
80,482
1,728
4,369
2,908
(
58,005 )
(
3,918 )
18,393
71,271
(
208,311 )
(
36,356 )
103,495
(
1,696 ) (
1,027 )
(
45,902 )
68,742
30,574
(
35,034 )
(
4,214 )
9,443
1,150
21,051
20,593
11,266
716,685
649,659
12,361
7,186
2,671
4,032
(
3,044 ) (
6,678 )
(
77,808 ) (
73,168 )
650,865
581,031

(Continued)

~33~

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars)

Notes
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of available-for-sale financial assets - non-
current
Proceeds from liquidation of financial assets carried at cost
6(7)
Proceeds from capital reduction of financial assets carried
at cost
6(7)
Acquisition of investments accounted for using the equity
method
6(8) and 7
Cash paid for acquisition of property, plant and equipment
6(28)
Interest paid for acquisition of property, plant and
equipment
6(9)(23)(28)
Proceeds from disposal of property, plant and equipment
Acquisition of intangible assets
6(10)
Increase in prepayments for equipment
(Increase) decrease in guarantee deposits paid
Increase in other non-current financial assets
Decrease (increase) in other non-current assets
Net cash flows used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term borrowings
Dncrease (iecrease) in short-term notes and bills payable
Increase in long-term borrowings
Decrease in long-term borrowings
Increase in guarantee deposit received
Cash dividends from capital surplus
6(18)
Payment of cash dividends
6(19)
Increase (decrease) in non-controlling interests
Net cash flows used in financing activities
Effect of foreign exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
6(1)
Cash and cash equivalents at end of year
6(1) 2015
2014
($
35,910 ) ($
66,846 )
-
788
3,496
-
-
(
40,359 )
(
125,050 ) (
113,475 )
(
244 ) (
269 )
2,103
1,073
(
859 ) (
6,429 )
(
53,072 ) (
57,624 )
(
8,005 )
1,434
(
2,034 ) (
3,349 )
361
(
810 )
(
219,214 ) (
285,866 )
25,155
(
154,287 )
(
10,000 )
30,000
90,923
81,750
(
155,305 ) (
40,000 )
3,061
2,195
(
89,348 )
-
(
89,348 ) (
446,740 )
19,556
(
3,438 )
(
205,306 ) (
530,520 )
(
3,199 )
10,647
223,146
(
224,708 )
543,233
767,941
$
766,379
$
543,233

~34~

Appendices

Standard Chem. & Pharm. Co., Ltd. Shareholding of Directors and Supervisors

SCP’s total shares (issued and outstanding): 178,696,089 shares
Minimum shareholding required and record of shareholding by Directors and Supervisors according to SCP’s share register:

Title	Minimum share required	Shares record per register
Directors	10,721,766	26,210,694
Supervisors	1,072,177	9,110,851

Directors and Supervisors shareholding record table:

Position	Name	Shares per register	Shareholding ratio(%)
Chairman	Chin-Tsai, Fan	20,786,813	11.63
Director	Fan Dao Nan Foundation Representative: Tzu-Ting, Fan	5,423,881	3.04
Director	Yuan-Te, Li	-	-
Independent Director	Chin-Lin, Chou	-	-
Independent Director	Lin-Yu, Li	-	-
Supervisor	Yuan-Feng, Kao	16,182	0.01
Supervisor	Tsui-Wen, Yeh	9,094,669	5.09
Total		35,321,545	19.77

The total shareholding of SCP Directors and Supervisor is in accordance with the minimum shareholding requirement.

~35~

AI assistant

S.C.P.C — AGM Information 2016

51900_rns_2016-07-22_9131af88-d9e1-42de-abba-f65dfafa8a9a.pdf

Standard Chem. & Pharm. Co., Ltd.

Handbook for the 2016 Annual Meeting of Shareholders

MEETING TIME: June 17, 2016

----Disclaimer----

Table of Contents

I. Meeting Procedure

Standard Chem. & Pharm. Co., Ltd.

10.Adjournment

II. Meeting Agenda

Agenda of Annual Meeting of Shareholders

III. Proposal and Discussion (I)

Proposal:(Proposed by the Board)

IV.Company Reports

Supervisor’s Review Report

To Shareholders:

Supervisor’s Review Report

To Shareholders:

V. Proposals and Approvals

1. Proposed by the Board

Proposal:

Explanation:

Resolution:

2. Proposed by the Board

Proposal:

Standard Chem. & Pharm. Co., Ltd. PROFIT DISTRIBUTION TABLE

Year 2015

VI.Proposal and Discussion (II)

Proposal:

VII.Question and Motions VIII. Adjournments

Attachments

Attachment 1:

Standard Chem. & Pharm. Co., Ltd. 2015 Business Report

Attachment 2:

REPORT OF INDEPENDENT ACCOUNTANTS TRANSLATED FROM CHINESE

To the Board of Directors and Shareholders of Standard Chem & Pharm. Co., Ltd.

STANDARD CHEM. &PHARM. CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2015 AND 2014

STANDARD CHEM. &PHARM. CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2015 AND 2014

STANDARD CHEM. &PHARM. CO., LTD. PARENT COMPANY ONLY STATEMENTS OF INCOME FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

STANDARD CHEM. & PHARM. CO., LTD. PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

STANDARD CHEM. & PHARM. CO., LTD. PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

STANDARD CHEM. & PHARM. CO., LTD. PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2015 AND 2014

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2015 AND 2014

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME

FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014 (Expressed in thousands of New Taiwan dollars)

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

Appendices

Standard Chem. & Pharm. Co., Ltd. Shareholding of Directors and Supervisors

More from S.C.P.C

S.C.P.C AGM Information 2016

`STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014`

`STANDARD CHEM. & PHARM. CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME`

`FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014`