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

Owing to the spread of the COVID-19 pandemic across the world, countries around the world began implementing lockdown measures starting March 2020, leading to sharply shrinking demand and supply chain disruptions while severely impacting production, consumption, and investment confidence. These developments have hit the global economy really hard, dragging down international crude oil, raw materials such as ethylene and propylene, and petrochemical products in the process. Despite declining product markets and narrowing interest rate spreads, the costs of raw materials dropped substantially at the same time, enabling FPC to continuously maintain profitability in the first half of 2020. Yet, FPC posted a consolidated loss after tax as a result of a significant decline in revenue at our investment companies, such as Formosa Petrochemical Corp. and Formosa Plastics Corporation, U.S.A. As countries began to open up gradually in the second half of 2020, demand for epidemic prevention supplies, home exercise equipment, construction materials, consumer electronics, and home appliances grew exponentially, thanks to the stay-at-home economy and explosive pent-up demand, thus paving the way to gradual global economic recovery. Furthermore, with countries around the world adopting monetary easing and fiscal stimulus policies in large quantities, the prices of petrochemical products have experienced a rebound and recovered to pre-pandemic levels at the end of 2020. Specifically, the prices of polyvinyl chloride (PVC) and polyethylene vinyl acetate (EVA) have reached new heights in nine years, enabling FPC to improve our annual performance and escape the spectre of losses.

As the saying goes, "Forewarned is forearmed." Looking back on 2020, FPC's active engagement and implementation of innovative R&D in the face of various management difficulties arising from the economic impact of the COVID-19 pandemic and oversupply of petrochemical products have seen our collaboration with ITRI on the development of "dye-sensitized batteries for smart home technology" honored with the R&D 100 Awards. Such an accomplishment demonstrates that FPC's innovative R&D and commercialization capabilities have earned recognition from the global technology community. At the same time, FPC has established the Artificial Intelligence Research & Development Center at Renwu Complex, in order to deepen the development and application of artificial intelligence (AI) in five areas, namely production and marketing optimization, quality assurance, smart maintenance, digital inspection, and cost reduction, thereby enhancing operating efficiency. On the other hand, FPC has built an integrated marketing platform for non-woven fabric using blockchain technology, which will be expanded to the medical, automotive, shoe materials, and wind power industries, with the aim of connecting the upstream, midstream, and downstream sectors to form a global industry alliance and provide customers with a full range of services. In addition, the FPC E-Business System has also been set up, with the intention of realizing customer-oriented digital transformation and moving toward the development of a smart production and sales system. FPC also conducted muti-faceted business promotion and communication with customers via remote marketing with hopes of creating a win-win situation during the COVID-19 pandemic. FPC spared no effort to implement the aforesaid management strategies and take corrective measures in the course of pursuing rationalization, so as to strengthen corporate management. While dealing with multiple challenges such as the COVID-19 pandemic, FPC was 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.

As a member of the global corporate citizenship, FPC has made great strides in five areas, namely corporate governance, environmental sustainability, employee welfare, workplace safety, and community co-prosperity, and is progressing toward nine of the United Nation's Sustainable Development Goals (SDGs), so as to realize the management philosophy of "Perpetual Business Operation and Dedication to the Society" upheld by our two founders. After years of implementation, not only has FPC been selected as a constituent of the TWSE Taiwan High Compensation 100 Index, Taiwan Employment 99 Index, and Corporate Governance 100 Index, but also became one of the only three companies in Taiwan to receive the Legendary 50 Award from China Credit Information Service Ltd. in 2020 for being ranked among the top 100 Companies by revenue for 50 consecutive years. Moreover, four departments received commendation and recognition from the competent authorities, thanks to their outstanding performance in occupational safety and health. Specifically, Mailiao Linear Low Density Polyethylene (LLDPE) Plant and Acrylonitrile (AN) Plant have been honored with the Five-Star Excellent Occupational Safety and Health Department Award by the Yunlin County Government for three consecutive years. It is even more gratifying to know that owing to FPC's success in epidemic prevention, our employees have been able to stay safe and healthy throughout a year ravaged by the COVID-19 pandemic. Based on the spirit of altruism, FPC joined the national facial mask production team and gave full support in providing the raw materials required for the production of medical protection and sanitary products, thereby contributing to epidemic prevention in Taiwan and safeguarding people's health.

FPC has been committed to creating an excellent living environment and a better and sustainable future for the Earth. As of 2020, we invested a total of NT$25.4 billion in pollution prevention, energy conservation and waste reduction, greenhouse gas (GHG) reduction, and industrial safety and fire protection. In 2020 alone, we conserved 4,043 tons of water per day and reduced an additional 137 thousand tons of GHG emissions per year. According to the 2020 assessment results announced by the Carbon Disclosure Project (CDP), an international environmental assessment index, FPC was given an A rating in climate change assessment and an A- rating in water resource assessment, both of which ranked among the best for internationally-renowned chemical companies. Such performance has confirmed FPC's significant results in energy conservation, emission reduction, and circular economy in response to climate change. Additionally, FPC has also carried out white smoke elimination and improvement at Renwu Plant and promoted zero wastewater discharge at all complexes in consideration of increasingly stringent environmental protection laws and regulations in Taiwan. At the same time, all complexes have implemented various measures, such as reducing sources of volatile organic compounds (VOCs), streamlining equipment components, and gradually replacing equipment components with low-leakage ones, supplemented with the application of infrared detectors (i.e. GasFinder) to enhance self-inspection, so as to create a friendly environment and promote mutual benefit with environmental sustainability.

Faced with international environmental, social, and corporate governance (ESG) trends in 2021, FPC, as a leading company in the petrochemical industry in Taiwan, will continue to fulfill our sustainability commitment to all stakeholders by deepening AI development and R&D, actively nurturing talents in AI, big data, and cloud computing, and speeding up the application of AI in various areas to optimize production and sales, improve quality and management performance, and reduce energy consumption, as well as carrying out pipeline inspections and leak detection to enhance safety, health, and environmental management. Furthermore, we strive to innovate and develop forward-looking and high-value materials and process technologies and move toward the development of specialty products in response to the emergence of the semiconductor, 5G, renewable energy, and medical and epidemic prevention industries, so as to enhance our competitiveness over the long run. While maintaining business development and environmental sustainability, FPC will continue to promote circular economy and energy saving and carbon reduction and build renewable energy, with the goal of becoming a leading enterprise that fulfills corporate social responsibility and creates sustainable value for all stakeholders.