IR publication – January 2018

Far Eastern New Century 1402 (TWSE)

1

• Year of establishment: 1954

• Asset allocation as of Sep 30, 2017 (Total assets: NT$ 506 billion / Book value per share: NT$ 35.9 /share)

Business Segments Production Sites Current Capacity

Pro

du

cti

on

Petrochemical Taiwan & Shanghai PTA: 1.58 mm tons/yr

Polyester

Taiwan,

Shanghai,

Suzhou,

Wuhan,

Japan,

Malaysia

Polymer: 1.97 mm tons/yr

PET: 1.36 mm tons/yr

PSF: 490K tons/yr

Polyester Filament: 121K tons/yr

Others

Nylon 6,6 filaments: 21K tons/yr

PET Sheets: 131K tons/yr

PET films: 20K tons/yr

Textiles

Taiwan,

Suzhou,

Wuxi,

Vietnam

Yarn: 513K spindles/yr

Knitted Fabrics: 25K tons/yr

Industrial Fabrics: 21K tons/yr

Industrial Yarn: 102K tons/yr

Apparels: 5.2 mm dozens/yr

Property Various locations in

Northern Taiwan

Total size: 200k pings

(662k sq meters)

Telecom

(Far EasTone)

Integrated service

provider - mobile,

fixed line, ISP, etc.

# of subs: 7.2 mm

Investment &

Others Cement, retail, financial services…etc.

Company Overview

Company Overview

Production

54%

Property

3%

Investment

& Others (Including

Telecom)

43%

• Revenue breakdown in 1-3Q, 2017

Production

31%

Property

30%

Investment

& Others (Including

Telecom)

39%

2

Strategy Go

Green

Value

Added

Products

Total Solution (Products + Services)

Invest in the

Future

Strategic Summary

Stable

Investment

Income

Transformation

of

Production

Business

Monetization

of

Property

Business

Sound Financials & Stable Dividend Policy

We are growing and transforming in a systematic way

In 2016, 25% of the Production Business

revenues is derived from

recycled/bio/energy-saving products.

Company Overview

3

Value of Major Investments - Listed Companies

(NT$ million)

Note1: Beginning from 18 August 2017, Far Eastern International Bank was re-classified under the equity investment method.

Note 2: 5,353 million shares of FENC common stock were issued and outstanding as of 30 Sep 2017.

Company Overview

Stock code Investees Holdings Book value

(2017.9.30)

Market value

(2017.12.28)

1102 TT Asia Cement 26% 19,995 23,954

1460 TT Everest Textile 26% 1,130 1,750

1710 TT Oriental Union Chemical 31% 5,926 8,559

2606 TT U Ming Marine 0% - -

2845 TT Far Eastern International Bank 16% 5,081 4,954

2903 TT Far Eastern Department Stores 24% 7,032 4,979

4904 TT Far EasTone 38% 26,991 91,446

Total 66,154 135,642

4

A Leading Integrated Polyester Producer

ASIA TOP 1

PET Sheet

WORLDWIDE TOP 6

PET Resin

WORLDWIDE TOP 2

Nonwoven

Polyester Staple Fiber

ASIA PACIFIC TOP 1

Nylon 6,6 Filament

WORLDWIDE TOP 1

Recycled-PET

Production business strategy

5

What Differentiates Us from Our Peers?

• Vertical integration: the only producer manufacturing from raw material PTA to providing total solution

services to brand clients. Also speeding up the Vietnam expansion project to meet client demand for

future growth.

• Award winning innovations: modifying polymer “gene” (technology built in) by R&D team and thus

producing textiles difficult for peers to clone. Smart, functional & sustainable textiles.

• Close customer partnerships: chosen as their strategic partners by well-known brands.

Note: • 1 Polyester = 0.83 PTA + 0.33 MEG

• 1 PTA = 0.67 PX + 0.03 acetic acid

• 1 MEG = 0.6 Ethylene + oxygen + water

Production Business (Smart from the Start : R&D Efforts) Outsourced Feedstock

Production business strategy

Green products please refer to page 11

Natural Gas

Food Packaging

Non-food Packaging

Apparel

PTA

MEG

PX

Ethylene

Naphtha

Nylon 6,6 Filament

Nylon 6,6 Flake

Polyester Staple Fiber Non-

Apparel Polyester Filament

• Germanium (鍺觸媒) &

titanium catalyst (鈦觸媒)

PET to replace antimony

catalyst (銻觸媒) PET

• PET heat shrinkable films

• A-PET (Amorphous) sheets

• Nonwoven

−Low melt fibers

−Hygiene

• Industrial use

−Airbag / safety belt

−Tire cord / conveyor belt

PET Resin

Polyester Polymer

TopDry®

6 Production business strategy 6

7

Key barriers : 1)securing feedstock supply & 2)acquiring quality approvals (i.e. FDA and clients’ approval)

• Shirts : FENC announced the 1st

100% bio-polyester shirt made

entirely from plants in April 2016

• Match with “Local-to-Local” distribution system of

international beverage producers

• Production sites:

Taiwan Japan China/ASEAN Europe/US

• JV with Ishizuka Glass Co., Ltd. in Japan: − Annual capacity: 35k tons

− Commercial run in 2015

• FENC’s recycled-PET capacity expansion plan: − 20K tons in 2014 90K tons in 2015 140K tons in 2019

Go Green: Recycled-PET & Bio-based PET

Phase I: Worldwide Production Base Phase II: 100% Bio-PET Products

Production business strategy

0.33 Bio-PET 1st generation: food crops (ex: corn, sugar cane, etc.)

2nd generation: agriculture waste (ex: corn stalk, wheat straw, rice straw, etc.)

0.83

Phase I:

Phase II:

Recycled

bricks R-PET

Bio-PTA

Bio-MEG

• Bottles: FENC co-developed with

Coca-Cola the 1st bio-PET bottle

and announced in 2014

8

Invest in the Future: Smart Textiles

• A revolutionary smart garment system that seamlessly connects the

textile and digital worlds.

- Efficient turn-key solution in terms of both cost efficiency and

manufacturing process

- Highly durable materials that can be used in diverse sports, fitness and

wellness scenarios

- Advanced conductive coating film that allows highly accurate bio-sensing

analytics

- Simple and commercial-ready system that integrates textile

manufacturing, electronic devices and application/software development

- Non-allergenic

Production business strategy

• DynaFeedTM : Smart Clothes (the Internet of Textile)

The ISPO AWARD jury’s description:

“A great new component that does not inhibit the

functionality of the fabric while collecting and

transporting vital information”.

FENC® DynaFeedTM user-friendly interface provides body vital information for

user, enhancing training quality and efficacy.

9

New Book Value (Market value using

“fair value model” under

TW IFRS on Sep 30, 2017)

• Total land holdings: approximately 570k pings (1,887k sq meters)

• Investment properties as at Sep 30, 2017: approximately 200k pings (662k sq meters)

Land Holdings Owned by FENC

NT$ 35.3 BN

NT$ 124 BN

Old Book Value Market Value (After future

land development)

Property development plan

After disposing

investment properties

Gain on disposal of

investment properties

(P&L)

Special reserve

Unappropriated earnings

(Balance sheet)

Total distributable

income

10

Banqiao Size: 84,421 pings (279,434 sq meters)

Book value: ~65% of investment properties

Investment Properties – Major Pieces of Land

a) Land holdings in Taipei City include self-use and investment properties

b) 1 ping = 3.31 sq m = 35.58 sq ft

Taipei City (Note a)

Size: 1,651 pings (5,465 sq meters)

Yilan (SPA resort) Size: 32,035 pings (106,036 sq meters)

Phase I plan: villa concept, around 200 rooms

Hualien Size: 9,446 pings (31,266 sq meters)

New Taipei City & Keelung City Size: 9,091 pings (30,091 sq meters)

Property development plan

Taishan Size: 16,829 pings (55,704 sq meters)

Tau Yuan County Size: 38,804 pings (128,441 sq meters)

11

Developed area

(2008-2016)

Developing area

(2017-2020)

Developing area

(after 2020)

• Target tenants for commercial office buildings

A smart green campus, with sole property ownership, integrated with residential zones (for sale),

commercial offices (for lease), a medical center, a college, and a hypermarket in the neighborhood

Taipei Far Eastern Telecom Park (Banqiao)

Retail

Medical Center

Oriental Institute

of Technology

Residential III

Residential II

TPK-B

TPK-C

TPK-D

Residential IV

Property development plan

Car Park

South

park

TPKC.D

North

Park

New Taipei City

Library

Residential

III

TPKA

Residential

II

Taiwan

Power

12

Dividends Payout History

Dividend policy

13

Key Financial Highlights (IFRS-consolidated Base)

(1) EPS is calculated using adjusted outstanding shares (deducting treasury stock). Note:

(NT$ million) YoY

Revenues 56,374 100% 52,890 100% 7% 159,664 100% 215,856 100% 217,948 100%

Profit from Operations 5,462 10% 4,131 8% 32% 12,060 8% 14,537 7% 14,514 7%

1,061 2% 160 0% 562% 2,517 2% 1,874 1% 2,722 1%

Interest Expenses-Net (503) -1% (522) -1% n.a. (1,590) -1% (2,046) -1% (1,966) -1%

Gain on revaluation of investment property 200 0% 615 1% -68% 1,054 1% 3,269 2% 4,659 2%

Gain (Loss) on disposal of investment property - - - - n.a. - - 313 0% 942 0%

Others (16) 0% (488) -1% n.a. (418) 0% (1,987) -1% (1,168) -1%

Consolidated Income before Tax 6,203 11% 3,896 7% 59% 13,623 9% 15,960 7% 19,701 9%

Tax Expenses 845 1% 746 1% 13% 2,304 1% 3,257 1% 5,014 2%

Consolidated Net Income 5,359 10% 3,151 6% 70% 11,320 8% 12,703 6% 14,686 7%

Attributable to:

Shareholders of the Company 3,600 6% 1,329 3% 171% 6,434 4% 6,308 3% 8,035 4%

Non-Controlling Interests 1,758 3% 1,822 3% -4% 4,886 3% 6,395 3% 6,652 3%

EPS (NT$)(1) 0.72 0.27 1.29 1.26 1.61

Depreciation & Amortization 5,207 9% 4,895 9% 6% 15,281 10% 19,338 9% 18,265 8%

Total Assets 505,940 100% 513,460 100% 518,765 100%

Total Debt 254,591 50% 261,268 51% 258,368 50%

Net Interest-bearing Debt 162,388 32% 160,148 31% 152,787 29%

Total Equity 251,349 50% 252,193 49% 260,397 50%

192,008 38% 190,886 37% 197,252 38%

Non-Controlling Interests 59,341 12% 61,306 12% 63,145 12%

Book Value Per Share 35.9 35.7 36.8

1-3Q, 17 2016 2015

Investment Income(Equity method)-Net

Total Shareholders' Equity of

Parent Company

3Q17 3Q16

14

Performance by Business Segments

Production Business

Production Business

Note: (1) Investment & Others segment includes investment income (loss) from equity-method investees, i.e. ACC, FEDS, and share disposal gain (loss), etc.

(NT$ million) 3Q17 3Q16 YoY 1-3Q, 17 2016 2015

Reclassified for Presentation Purposes

Gross Revenue

Petrochemical 7,415 7,012 6% 22,169 31,401 29,976

Polyester 16,487 14,428 14% 46,221 59,463 60,476

Textile 9,089 8,903 2% 25,337 33,946 32,260

Telecom 22,865 23,319 -2% 67,281 94,344 97,293

Property 1,427 1,971 -28% 4,951 8,896 6,644

Investment & Others (1) 3,944 1,427 176% 8,574 6,935 8,783

Subtotal 61,227 57,059 7% 174,534 234,986 235,432

Inter-company Sales 3,734 3,995 -7% 12,098 17,053 14,532

Revenue-net 57,494 53,065 8% 162,435 217,932 220,900

Profit from Operations

Petrochemical (62) (518) n.a. (1,120) (1,275) (1,647)

Polyester 296 55 435% 423 693 897

Textile 369 344 7% 846 1,178 673

Telecom 3,735 4,260 -12% 11,301 15,024 15,393

Property 137 366 -63% 517 1,009 692

Investment & Others (1) 2,029 (364) n.a. 2,777 158 1,100

Subtotal 6,504 4,144 57% 14,743 16,787 17,108

Other Adjustments 78 162 -52% 89 (174) 358

Reclassified Profit from Operations 6,581 4,306 53% 14,832 16,613 17,465

For Reconciliation Purposes

-1,061 160 562% 2,517 1,874 2,722

- Dividend Income 59 15 294% 254 203 230

Profit from Operations 5,462 4,131 32% 12,060 14,537 14,514

Investment Income from

Equity-method Investees, net

15

• The Chairman won the “Top 50 Taiwan CEOs 2016” hosted by Harvard Business Review

(哈佛商業評論-2016年度台灣執行長50強)

• Ranked “One of the Most Admired Companies in Taiwan” 2003 - 2012 by CommonWealth

Magazine (天下雜誌最佳聲望標竿企業)

Management

&

Leadership

Recent Achievements & CSR

• TW (S&P) long-term credit rating: TW A+

• Board independence: Three independent directors appointed in 2012

• Remuneration & audit committee: Established in 2011 and 2015, separately

• A constituent of the MSCI ESG Leaders Indexes (MSCI ESG Rating – Industrial

Conglomerates: A), FTSE4Good Emerging Index & TWSE CG 100 Index

• FENC has reached to Management Level in the Carbon Disclosure Program (CDP).

• CSR report: prepared according to GRI G4 Comprehensive option and the AA 1000 standards and awarded “Best Report of the Year” by

Taiwan Corporate Sustainability Award in 2017

• CSR achievements: - Awarded “TOP50 Sustainable Corporates”, “Sustainable Water Management Awards”, “Social Inclusion Award”, “Growth through Innovation

Awards” and “Circular Economy Leadership Awards” by Taiwan Corporate Sustainability Award in 2017

- Ranked “One of the Top 50 Large Enterprises of Excellence in Corporate Social Responsibility” by CommonWealth Magazine in 2017

- Awarded “Excellence Award in CSR Annual Survey Award - Traditional Industries Group by Global Views Monthly in 2017

Environmental,

Social

&

Governance

• Selected “the 2018/19 TOP10” by ISPO (TopDry®, TopDry® Non-woven & Wind Guard 3D )

• Awarded “the 2016/17 Gold Award” by ISPO in Munich (Dynafeed® )

• Awarded “the 2016 Sustainability Winner” by Adidas (ocean plastic recycled project)

• Awarded “the 2014 Consumer Decides Award” by Nike

• Awarded “the 2013 Apparel Fabric Supplier of the Year” by Puma

• Awarded “2013 Supplier of the Year” by Coca-Cola

• Awarded “2013 Supplier Innovation Award” by Nike

Client

Relationship

&

Green

16

This presentation is prepared by Far Eastern New Century Corporation (the “Company”)

and is solely for the purpose of corporate communication and general reference only. The

presentation is not intended as an offer to sell, or to solicit an offer to buy or form any

basis of investment decision for any class of securities of the Company in any

jurisdiction. All such information should not be used or relied on without professional

advice. The presentation is a brief summary in nature and does not purport to be a

complete description of the Company, its business, its current or historical operating

results or its future prospects.

This presentation is provided without any warranty or representation of any kind, either

expressed or implied. The Company specifically disclaims all responsibilities in respect of

any use or reliance of any information, whether financial or otherwise, contained in this

presentation. Neither this presentation nor any of its contents may be reproduced to a

third party without the prior written consent of the Company.

Disclaimer