2024 OUCC annual report

@ 1?% : 1710 | NJM B @ March 31, 2025

2024

OUCC

Annual Report

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Name: Daniel Yu

Title: Assistant Vice President Tel: 02-27193333

Email: danielyu@oucc.com.tw

Name: David Chiang

Title: Assistant Vice President Tel: 02-27193333

Email: davidchiang@oucc.com.tw

Address: 13F, 101, Fu-Hsing North Road, Songshan Dist., Taipei City 10595, Taiwan Tel: 02-27193333

Address: 3 Industrial 3rd Road, Linyuan Dist., Kaohsiung City 83245, Taiwan Tel: 07-6413101

Oriental Securities Corporation

Address: 13F, No. 16, Xinzhan Road, Banqiao Dist., New Taipei City 22041, Taiwan Tel: 02-77531699

https://www.osc.com.tw

Name: Wen-Ling Liu, CPA Pei-De Chen, CPA

Firm: Deloitte & Touche

Address: 20F, No. 100, Songren Rd., Xinyi Dist., Taipei City 11073, Taiwan Tel: 02-27259988

https://www.deloitte.com.tw

https://www.oucc.com.tw

The English version is the translation of the Chinese text and if there is any discrepancy between the English version and the Chinese text of this document, the Chinese text shall prevail.

Oriental Union Chemical Corporation

Contents

1. Letter to Shareholders 1
2. Corporate Governance

   1. Information on the Company's Directors, President, Vice Presidents, Assistant Vice President, and heads of all the Company's divisions and branch units 6

   2. Remuneration paid to Directors, Presidents, and Vice Presidents in the most recent year 15

   3. Implementation of Corporate Governance 20

   4. Information of CPA professional fee 57

   5. Information of CPA replacement 58

   6. Information regarding Chairman, President, and Financial or Accounting Manager of the Company who has worked with the CPA firm which conducts the audit of the Company or

      an affiliate of said firm in the recent year 59

   7. Any transfer of equity interests and pledge of, or change in equity interests by a Director, managerial officer, or shareholder with a stake of more than 10 percent. 59

   8. The top 10 shareholders and their relationships. 60

   9. The number of shares held by the Company and Company Directors, managerial officers and the entities directly or indirectly controlled by the Company in a single company and

      calculating the consolidated shareholding percentage of the above categories. 61

3. Capital Overview

   1. Capital and Shares 62

   2. Issue of Corporate Bonds 64

   3. Preferred Shares 64

   4. Issuance of Overseas Depository Receipts 64

   5. Employee Stock Options 64

   6. Employee Restricted Stock Awards 64

   7. Share Issued for Mergers and Acquisitions 64

   8. Implementation of Capital Utilization Plan 64

Contents

1. Operation Overview

   1. Business Activities 65

   2. Market, Sale and Production Overview 75

   3. Employees 82

   4. Environmental Protection Expenditure 82

   5. Labor-Management Relations 84

   6. IT Security Management 86

   7. Major Contracts 88

2. Financial Status, Performance Review and Analysis and Risk Management

   1. Financial Position Review 89

   2. Financial Performance Analysis 90

   3. Cash Flow Review and Analysis 91

   4. The Effect of Major Capital Expenditure on the Financial Position and Operation of the Company 91

   5. Direct Investment Policy, the Main Reasons for Profit or Loss as well as the Corrective Action Plan Over Past Year, and an Investment Plan for Next Year 92

   6. Analysis of Risk Factors 93

   7. Other Important Notes 97

3. Special Disclosure

   1. Information of Affiliates 98

   2. Private Placement of Securities 100

   3. Other Supplementary Notes 100

   4. Any Matters of Material Significance that could have Affected Shareholder Equity or Securities Price Last Year and up to the Date of Publication of the Annual Report 100

Oriental Union Chemical Corporation

1. Foreword

   In view of 2024, the elevated purchasing power from the mitigation of global inflation sustained the commodity demand and service and stabilized the global trade volume with a growth rate of 3.5%, estimated by OECD. However, the intensified geopolitical issues, which resulted in the energy price fluctuations, supply constraints, and global supply chain disruptions, weakened the expected manufacturing export momentum and mitigated the overall economic growth, especially the Chinese market, which significantly impacted the global economy with a growth rate of 3.2% estimated by IMF in 2024. Taiwan benefited from the accelerated expansion of AI emerging technology and the like, driving the production and export growth. Taiwan's economic growth rate in 2024 was 4.59%, according to Directorate-General of Budget, Accounting and Statistics.

   The crude oil market was also volatile in 2024 due to impact such as the geopolitical issues, OPEC+ oil production cuts and the expected oil production resumption of the US. The global petrochemical industry, on the other hand, underwent a severe imbalance between supply and demand, resulted from the market sluggish on account of macroeconomic uncertainties as well as the successive expansion of large-scale petrochemical refining system of China in recent years. The petrochemical industry of Taiwan, part of the global supply chain, wasn't spared.

   To cope with the rapidly changing environment and strict challenges, the Company has dedicated relentlessly to the manufacturing process improvement, cost structure optimization, strengthening advantage across the strait, and advanced proactively in the high value-added product through its proprietary technology, base of ethylene oxide and axes in green, electronic and new materials. In 2024, the consolidated revenue reached NT$23.8 billion, an increase of 14% from the previous year. The net profit after tax attributable to the Company was NT$20 million, earnings per share (EPS) NT$0.02.

2. Operating Performance Review

Aiming at the green and sustainable development, the Company practices circular economy, attaches great importance to issues such as industrial safety, health and environmental protection, and improves persistently the process design, equipment investment, and recycles homogeneous waste to reduce the impact on environment for the balanced development between industry production and environment protection.

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