YFY — Interim / Quarterly Report 2020

Jan 11, 2021

YFY

3Q20 Earnings Results

2020/11/13

Disclaimer

This presentation is prepared according to the reviewed financial statements by CPA and the financial numbers hereby are based on IFRS, please refer to the published financial statements for full content.

The presentation may contain forward-looking information and may . differ materially from the actual results YFY does not warranty as to the accuracy or completeness of such information and nor assume any undertaking further information becomes available or in light of changing circumstances. You shall not place undue reliance on any forward-looking information.

The presentation and its contents may not be reproduced to a third party without the prior written consent of YFY.

YFY’s Management Targets

Improve Shareholders Equity

� Business Model ：

Develop 5 invested industries.

Dedicate ESGCircular Economy

� Not Incremental Cost but Profit Model

•Circular and Economics ：

•Water circular is one of YFY’s 5 major circular economy. The biogas power generation system has integrated with TPC. Furthermore, the Anaerobic bacteria may sell to other needed industries. The second generation of biogas power generation will be operating in 2021 Q1.

� Revitalize Assets ：

•Circular Economy Building ：

Apply the technology of water and energy management generated from paper manufacturing into the design of buildings

• •Develop Green Energy Building

•SRF power generation system used the manufacturing remainders as fuel to replace coal. It reduced the waste processing costs and has excess capacity to process waste from the neighborhood.(2021Q1)

� Global #1 Paper Company to Implement BS8001 Qualification

•Achieving “Optimizing” Grade, the Highest Level of Maturity

•YFY Packaging is implementing ESG practices to pursue a sustainable business model.

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YFY’s Investment Portfolio in Financial Statements

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Investment P/L in Financial Statements
Investment Holding
YFY’s Investment Portfolio
Shares
Category Periodical Disposal
Valuations
P/L Gain/Losses
Circular Maintain
Econo CHP、YFY Packaging、
Status：Paid-
my YFY Consumer Products in Capital Other
Operating Comprehensiv
Price-BV
≧50% MaterialsSpecialty Shin Foong Profits By % of the e Income
Subsidiaries * share
Controlling Net Income
shares IoT (By % of Status holdings of
Techno RFID share Changed： the
logy Net Income subsidiaries
holdings)
Others：Jupiter Price-BV
IoT Other
Techn Eink OI/OE Comprehensiv
20~50% olog e Income
Net Income
Affiliates Controlling Non-Shares MedicalsBio- Taiwan Global Biofund (By % of share Net Income Price -BV holdings of By %of the share
holdings)
the affiliates
Financial/
≦20% InvestmenVenture ts SinoPac, TWSE, etc. OI/OE Other ComprehensivOther
Comprehensive
FVOCI e Income
minority Net Income Income
interest MedicalsBio- Medeon, TaiGen, etc. Dividend Price -BV FVOCI
Income
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Blue Area：Statements of Comprehensive Income Green Area：Balance Sheet

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3Q20 Net Value Per Share Growth

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Unit：NTD
25.14
25 23.94
23.64
23
21.41 21.36
21 20.23 20.01 2.48
19.38
19 1.38
0.97
0.87
17
0.37 0.36 0.30
0.08
15
2013 2014 2015 2016 2017 2018 2019 2020
Net Value Per Share Earnings Per Share 3Q
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3Q20 YFY Assets Allocation Maximized Retained Earnings

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YFY Consolidated
YFY Consolidated
Statements of
Statements of
Changes in Equity
Comprehensive Income
Dispose
Paid-In Capital YFY CPG Dispose share
Revenue (Appropriable)
NT$ 1.371 NT$ 1.242 of Subsidiaries
Operating Billions Billions
Profits
Net Profits Unappropriated Other
NT$2.215 R eta ne i d Disposition E qu it y
EPS Billions
Earnings P/L
NT$ 11.007 NT$481 NT$ 3.978
OCI Billions Thousands Billions
Quarterly Valuation Accumulated into Other Equity
NT$-0.239
Billions
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*Numbers based on the 3Q20Financial statements

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3Q20 Financial Results

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||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|3Q20|3Q19|
|(NTD $M )|3Q20|2Q20|Q/Q|3Q19|Y/Y|Y/Y|
|YTD|YTD|
|Sales|18,789|17,346|8.3%|19,096 -1.6%|52,326 55,421 -5.6%|
|Cost of Goods Sold|14,959|14,060|6.4%|15,995 -6.5%|42,017 46,319 -9.3%|
|Gross Profit|3,830|3,285|16.6%|3,100 23.5%|10,309|9,102 13.3%|
|Operating Expenses|2,325|2,052|13.3%|2,420 -3.9%|6,655|6,944 -4.2%|
|Operating Profit|1,504|1,234|21.9%|680 121.1%|3,654|2,158 69.3%|
|None-Operating|
|Income/Expenses|1|,|824|717|154|.|5%|858 112|.|6%|2|,|548|686 271|.|5%|
|Profit before Tax|3,328|1,950|70.6%|1,538 116.4%|6,202|2,844 118.1%|
|Income Tax Expenses|688|413|66.5%|248 177.8%|1,319|688 91.7%|
|Net Profit|2,639|1,537|71.8%|1,290 104.5%|4,883|2,156 126.5%|
|Profit Attributable to|
|2,215|1,267|74.9%|1,179 87.9%|4,117|1,840 123.8%|
|Owners|
|EPS(NTD)|1.33|0.77|0.71|2.48|1.11|
|Gross Profit Margin|20.4%|18.9%|1.4%|16.2%|4.1%|19.7%|16.4%|3.3%|
|Operating Profit|
|8.0%|7.1%|0.9%|3.6%|4.4%|7.0%|3.9%|3.1%|
|Margin|

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3Q20 None-Operating Income/Expenses

(NTD $M) 3Q20 2Q20		3Q19
Financial Costs - 158 -	182	-	219
Interest Income 24	36		59
Share of Profit of Associates 134	192		181
FX Gains/Losses 62	-89		8
Dividend Income 85	671		700
Other Income 1,676	89		128
Total 1,823	717	858

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Segment Information

The YFY Group classifies its products and services into four segments in accordance with the business characteristics, as follows ：

(1.) Pulp and Fine Paper Business Groups

Including cardboard, paper and pulp and related products.

(2.) Containerboard and Packaging Business Groups

Including industrial cardboard containers, colored cases and food containers.

(3.) Consumer Product Business Groups

Household products including tissue paper, napkins, detersives and cosmetics

(4.) Others Business

Products other than paper including Specialty materials, RFID, Bio-medical investments and other services.

(The performance of segments is measured at operating profits of the business. Revenue and profit between segments have been adjusted; these adjustments include the elimination of intra-segment transactions to reconcile the segment information with that reported for the Group as a whole.

Revenue Trend By Operating Segments

Pulp and Fine Paper Containerboard & Packaging Consumer Others Total Revenue

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(NTD $ M)
% Q/Q
18,959 19,096 19,340 18,789
17,366 17,346
16,192
3,175
3,605 3,531
3,848 20% +16.3%
2,969 3,308
2,853 2,970
2,793 2 , 819 2 , 798 2,390 2 , 440 13% +2.1%
2,615
9,124
7,409 8,160 8,722 7,988 8,725 46% +9.2%
6,710
4,195 4,375 4,044 4,187 3,897 3,660 3,776 20% +3.2%
1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20
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Realized Investment Income to Increase Profitability

NT$ Million	2020 Q3	2020 Q3	2020 Q3	2020 3Q YTD
	Operating Profits Dividend Income Share of profit of associate s	Profit from Disposal of Land	Disposal of investments in equity instruments designated as at FVOCI	Operatin g Profits Dividend Income Share of profit of associates Profit from Disposal of Land Disposal of investments in equity instruments designated as at FVOCI
Pulp and Fine Paper Containerboard and Packaging Consumer Products Others 1. Shin Foong Others & Adjustments Other investments 1. Eink 2. Bio-Medical Investments 3. Financial and Venture Investments 4. Others	-209 - - 693 - - 362 - - - - 597 - - 61 - - - - 130 - - -5 - 58 - - 27 9	355 1,384	-	-376 - - - 1,532 - - - 1,187 - - 355 - - - - 1,153 - - - 158 - - 1,384 - - - 417 - - - 4 7.4 - 729 - - - 27 13 -6.7
			-
			-
			-
			-
			-
			-
			7.2
			-
			-6.7
Total	1,504 85 134	1,739	0.5	3,654 756 434 1,739 0.7

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Global #1 Paper Company to Implement BS8001:2017 Principles of Circular Economy, Achieving “Optimizing” Grade, the Highest Level of Maturity

YFY Packaging Inc. follows BS8001:2017 guidance to implement circular economy business model. The maturity model for the “YFY Circular Ecology” is Optimizing grade.

BS 8001 includes 6 principles: system thinking, innovation, stewardship, collaboration, value optimization, and transparency. YFY Packaging Inc. has achieved the highest Level 4 in all 6 dimensions.

The BS8001 Conformity Statement represents that the economic, environmental and social benefits are aligned with global audit standards. YFY Packaging is implementing ESG practices to pursue a sustainable business model.

The circular process starts from paper making with 95% of recycled paper; the biogas power generated from wastewater management process has become the largest biogas power in Taiwan. SRF (Solid Recovered Fuel) is processed from waste and then transported to renewable energy. YFY Packaging implements the most complete and largest scale circular economy model in the paper industry.

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Thank you

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