UPC Technology Corporation

Investor Conference

13 November, 2017

CONTENT

1. Company Introduction

2. Development Strategy

3. Financial Performance

4. Q & A

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Our market covers Taiwan, China, Southeast Asia, Northeast Asia, South Asia, USA, Canada, the Middle East and New Zealand.

> 10,000 customers globally

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• Founded：August 1976

• Chairman：Matthew F.C. Miau

• President：Yi-Shao Ko

• Revenue (Y2016)：NT$42.4 Billion (US$1.31 Billion)

• Number of Employees：~1700

• Taiwan Stock Exchange listed (Y1989)：code 1313

Core Chemicals

Specialty Chemical

Logistics Service

1. UPC Introduction

China

Taiwan

Malaysia

UPC’s Deployment in Asia

Manufacturing/Logistics Center

Taizhou, Jiangsu

Zhongshan, Guangdong

Zhenjiang, Jiangsu

Zhuhai, Guangdong

Linyuan, Kaohsiung

UPC Taipei office

UPCHK

4

Panjin, Liaoning

Nanchong, Sichuan

Kuantan, Malaysia

Phthalic Anhydride

Maleic Anhydride

Fumaric Acid

PVC Resin

General Plasticizer Phthalate

• DEHP • DNOP • DINP • DIDP • DPHP • DBP • DIBP

Terephthalate (DOTP)

Trimellitate

(TOTM, TNOTM)

Adipate (DOA)

UPC Business

Specialty Plasticizer

Hydrogenated (UN899)

Polymeric (UN600series)

Adipate (DINA, DIDA)

Benzoate (DEGDB)

Maleate (DOM, DBM)

Fumarate (DOF)

Bio-based

• Sebacate (DOS, DBS)

• Citrate (ATBC)

• Epoxide (ESBO)

• Succinate (UN9429)

UPR

Polyester Polyol

Fatty Ester

Lubricant Ester

Terminal operation

Tank farm storage

Warehouse storage

Transportation

Import / Export handling service

Trading

Engineering

Energy Service

5

Core Business

Specialty Chemical Business

Logistics and

Service Business

The Supply Chain UPC product

Raw Material

Application

PVC

Ethylene

Chlorine

EDC VCM

Plasticizers

PVC plastic products

PA

MA

FA

OX

N-Butane

Synthetic leather, Adhesive, UV coating, Shoe Sole, Rigid Foam

Boat, Button, Casting, Artistic Object, FRP,

BMC/SMC

mono alcohols

(2EH, INA…)

Fatty Ester Lubricant, Cosmetics Fatty Acid

Alkyd resin, Dyes, Pigments, Paint solvents

Alkyd resin, Pesticide Paper additives, Adhesive

Glycols (MEG, PG…) UPR

PTA

TMA

Adipic acid

Polyester Polyol

6

1,862

622

450

121 52

PLASTICIZER PA PVC UPR.POLYOL MA.FA

UPC production capacity by product (KTPA)

Global #1 PA and Plasticizer supplier

7

60%

14%

20%

4% 2%

Global #1 Global #1

Total capacity of 3100 KTPA in end 2017

• Plasticizer : 1862 KTPA

• PA : 622 KTPA

Chemical Tank Farm Sites

• Taizhou

• Zhuhai

• Panjin

Warehouse Sites

• Taizhou

• Zhenjiang

Road Transportation

• Tank/Flexitank container, Packing cargo truck, Liquid/Gas/Powder/Insulation tank

• Owned Fleet in Southern、Eastern、Southwest、Northeast

• 3rd Party Fleet covered all China area

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Transport and Storage of DG and General cargo

Logistics Capability in Greater China

Logistics Capability in Greater China

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Taizhou, Jiangsu

Owned Jetty

• 50,000 DWT

Zhenjiang, Jiangsu

3rd party Jetty

• 30,000 DWT

Panjin , Liaoning

Owned Jetty

• 50,000 DWT

• 10,000 DWT

(Q3/2017 completed)

Zhuhai, Guangdong

3rd party Jetty

• 80,000 DWT

Zhongshan , Guangdong

Owned Jetty

• 5,000 DWT

Jetty capacity

Transport and Storage of DG and General cargo

Nanchong, Sichuan

Owned Jetty(floating)

• Alongside Jialing river

Major tributary of the Yangtze (Planning)

Guangdong

石家莊

天津

The Marketing Regions of Greater China sites

Malaysia

Liaoning

Sichuan Jiangsu

Northeast

China

Russia

North China Northwest

China

Southwest

China South China

East China

Central China

Japan &

Korea

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The Marketing Regions of Malaysia site

UPC Malaysia

Japan &

Korea China

ASEAN

New Zealand , Australia

Middle East

South Asia

Africa

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2. Development Strategy

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The Long-term Development Strategy

Growth Strategy

Cooperation Strategy

Competition Strategy

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Scope

Expansion of product categories

Scale

Expansion of product capacity

use self-production and tolling to fully utilize

our production capacity and infrastructure to

enlarge the market share

develop diversified and customer focused

products to expand the category

Total capacity of 3106 KTPA in end 2017 Total capacity of 3496 KTPA in end 2018

unit: KTPA

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UniHydroTM UN899 + 200KTPA

PVC + 150KTPA

MA + 40KTPA

Our Green Plasticizers

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類別 產品名稱

Hydrogenated UniHydroTM

UN899

Polymeric UN600、UN610、UN615、UN620、UN630、UN640

Terephthalate UN488(DOTP)

Trimellitate TOTM、TNOTM、UN380、UN390、UN399

Adipate DOA、DINA、DIDA

Maleate DOM, DBM

Fumarate DOF

Benzoate DEGDB

Bio-based

• Epoxide ESO

• Succinate UN9429

UPC begin China’s first Hydrogenated Plasticizer plant in June, 2017

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• Odorless No odor

• Pass toxicology test Non-toxic

• Reduce the amount of viscosity reducer

• Reduce VOCs emissions Low VOCs

• Environmental-friendly plasticizer

Non-benzene

UniHydroTM UN899

• 1,2-cyclohexane dicarboxylic acid, di-isononyl ester

hydrogenation PHTHALATES

DINP

The Demand & Trend of UN899

upgrade trend of plasticizer market

DEHP (DOP)

DINP

DOTP

UN899

The plasticizer demand in China is about 4200 KTPA in 2016

UN899 is expected to replace 30% of

DOTP market 300 KTPA

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The advantages of UPC’s Taizhou PVC plant

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Ethylene-based PVC process. No pollution

Close to VCM plant. Feedstock VCM shipped by pipeline

Close to PVC processing customers

Own 50,000 DWT jetty for VCM / PVC import and export transportation

Steam generated from PA plant at the same site for PVC plant captive use

• Process

• Energy

• Raw Material

• Customer

• Transport

China total PVC capacity 23,125 KTPA

• Carbide-based PVC : 83%

• Ethylene-based PVC : 17%

Rationalize & environmental inspection policy in China

the high pollution and high energy consumption carbide-based small PVC plants are expected to be phased out gradually afterwards 2020.

The PVC Outlook

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2016~2018 China PVC Supply/Demand (KTPA)

開工率(%)

2016~2022 Asian PVC Price Trend (USD/MT)

Source：IHS / UPC (November 2017)

Ethylene-based PVC & Carbide-based PVC capacity % in China

OR (%)

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(2) Competition strategy: Cost leadership + Differentiation

Differentiation

Develop green plasticizers

• Hydrogenated plasticizer

• Succinate plasticizer

• Epoxide plasticizer

Develop high value added specialty chemicals

• PA & MA downstream derivatives

• C2、C3、C4 based chemicals & downstream derivatives

Circular economy: reuse the by-products and recycled materials to develop new products

Logistics service

Cost leadership

Continuous capacity expansion

• Global #1 PA and Plasticizer supplier

Multi-sites / Multi-factories / Modularization & High-efficiency factory construction to reduce investment cost & operational risk

Integrated production & Energy balance to reduce production cost

Form alliance with our supply chain to reduce feedstock cost

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(3) Cooperation Strategy : from Competition to Co-opetition

Co-opetition Co-operation

R&D RM supply

& purchasing

Inbound Logistics

Factory Operation

Outbound Logistics

Marketing and Sales

Co-opetition with the global leading plasticizer manufacturers in the industry value chain to create a win-win situation

Competition

3. Financial Performance 23

2012 ~ 2017 Q3 Consolidated Revenue

24

0

25

50

75

100

125

150

Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17

Oil price (USD/Barrel)

Europe Brent Spot PriceFOB (Dollars per Barrel)

Revenue (NTD Billion)

2012 ~ 2017 Q3 Production and Sales Volume

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2012~2016 average growth rate (YoY) • Production Qty : +11.8% • Sales Qty : +12.5%

KTPA

2017 Q3 YTD Revenue Breakdown by Products (%)

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2012~2017 Q3 Net Income after Tax & EPS

27

EPS (NTD)

NTD Million

2012 ~ 2017 Q3 Capital Expenditures

28

NTD Million

www.upc.com.tw

THANK YOU