Greetings to all our partners who have supported us throughout in the development of FPC and cared for its growth.

2019 marked a year of uncertainty. The global economy slowed down due to the uncertainties brought about by the China-U.S. trade war; the poor performance of automotive and real estate markets resulted in shrinking demand for aluminum, paint, textiles, and home appliances; the new production capacity of the petrochemical industry in China and the U.S. caused the supply to increase, leading to a decline in the prices of petrochemical products and further a petrochemical downturn; in addition, income of Formosa Petrochemical Corp., Formosa Plastics Corporation, U.S.A., and Formosa Sumco Technology Corp. plummeted. All of these factors led to a decline in both revenue and profit of FPC.

To reduce the impact caused by the slump in the petrochemical industry, FPC adopted the disruptive business strategies, including stepping up product differentiation and marketing. In 2019, the sales of distinctive products increased by 1% from 2018. Established by Formosa Industries Corporation, the high-density polyethylene (HDPE) plant with an annual capacity of 400,000 tons was put into production at the end of August 2019. In addition, FPC enhanced the development and application of artificial intelligence (AI) in the five aspects, namely, production and marketing optimization, quality assurance, smart maintenance, digital inspection, and cost reduction, and continuously implemented Industry 4.0 by developing automated production and marketing systems and applying them to all products to improve operational efficiency. We also encouraged employees to make innovative proposals and spared no effort to take corrective measures in course of pursuing rationalization, so as to strengthen corporate management. While dealing with multiple challenges, we were poised to maintain sustainable growth in acknowledgement of the support and encouragement from all of our shareholders, employees, and customers, as well as business partners.

Looking back on 2019, FPC acted as a builder of a prosperous economy while setting the short-term, medium-term, and long-term sustainable development goals in economic, environmental, and social aspects to fulfill corporate citizenship. We also identified nine of the United Nation's Sustainable Development Goals (SDGs) as our longterm sustainable development goals. At the same time, we continued to make all-out efforts to promote corporate governance, environmental sustainability, employee welfare, workplace safety, and shared prosperity with local communities, fully showing FPC's determination to achieve common good and sustainable development with all stakeholders. After more than five years of implementation, we were continuously selected as a constituent of the TWSE Taiwan High Compensation 100 Index, Taiwan Employment 99 Index, and Corporate Governance 100 Index, respectively, in 2019; besides, six departments received commendation and recognition from the competent authorities in terms of occupational health and safety, energy conservation, and workplace safety and health. FPC's efforts have been widely recognized; especially, Mailiao Complex has been granted the Five Star Award by the Ministry of Labor for its excellent performance in workplace health and safety for three consecutive years. More importantly, we have become more convinced that promoting sustainable development is imperative and a right thing to do.

FPC has been committed to creating an excellent living environment and a better and sustainable future for the Earth. As of 2019, we invested a total of NT$24.2 billion in pollution prevention, energy conservation and waste reduction, greenhouse gas (GHG) reduction, and industrial safety and fire protection. In 2019 alone, we conserved 3,926 tons of water per day and reduced 1,194 thousand tons of GHG emissions per year. To further reduce the environmental impacts caused by the plant operations, we took measures such as strengthening the control over leaks of volatile organic compounds (VOCs), setting up air quality stations at Renwu and Linyuan Complexes to monitor air quality instantly, launching the white smoke elimination project at the Renwu and Linyuan Utility Plants, promoting zero wastewater discharge, and keeping oil, water, gas, and plastic powder/pellets off the ground. In addition, FPC worked with the academic institute on the flue gas CO2 capture and reuse program, which was granted a subsidy by the Ministry of Economic Affairs under the "A+ Industrial Innovation R&D Program" in 2019.

In readiness for global curbs on plastics and environmental trends, FPC acquired a 19% equity interest in Minima Technologies Co., Ltd., a Taiwan's leading brand of compostable products and resins, in 2019 to meet the increased need for biodegradable plastics. The biodegradable compounds (particulate and colloidal) produced by Minima Technologies Co., Ltd. can be completely decomposed into water, CO2, and organic carbon in a general environment for a maximum of one and a half years without causing any environmental pollution. To achieve social and environmental sustainability, we will use the existing products of FPG such as PTA (pure terephthalic acid), butanediol, and maleic anhydride to develop the key raw materials of green plastics, namely, PBS (polybutylene succinate) and PBAT (polybutylene adipate terephthalate), facilitating the vertical integration of the green plastic industry's supply chain and the popularization of green plastics.

In the face of increased emphasis on corporate social responsibility in 2020, we, as the leader in Taiwan's petrochemical industry, will strive to fulfill our sustainability commitment to all stakeholders based on the management philosophy of our two founders. Aiming at the world's No.1 manufacturer that offers future-proof, high value-added, and eco-friendly products and processes on the basis of enhanced AI applications, FPC will build emerging technologies such as AI, 5G, quantum computing, and blockchain on the past implementation of automation and digitization while promoting the digital transformation throughout the value chain with optimized production and marketing and innovative management models; in addition, we will adopt a technology-based approach to improve service quality and long-term competitiveness. While maintaining business development and environmental sustainability, FPC will continue to promote circular economy and energy saving and carbon reduction and strengthen safety and environmental management and fire resilience, so as to prevent abnormal processes and industrial safety. Our goal is to become a leading enterprise that is committed to environmental protection, social prosperity, and economic development while creating sustainable value for all stakeholders.