Director Re-election is Completed at CPDC's 2021 Annual General Meeting to Improve Gender Diversity of Board Members and Enhance Corporate Governance

•     China Petrochemical Development Corporation (CPDC) successfully held the 2021 Annual General Meeting (AGM) in Miaoli today (July 2) in accordance with the relevant provisions of the guidelines for epidemic prevention for AGM published by Financial Supervisory Commission. Shareholders not only ratified our 2020 financial reports and the proposal for not distributing dividends but approved the proposal for domestic capital increase in cash by means of issue of no more than 600 million ordinary shares at the meeting. In addition, the election of the 22nd term of directors was successfully completed at this AGM, and three independent directors and six directors were elected. There is a female director on the list of CPDC's newly elected directors for the first time, Ms. Hui-Lan Chu, the Chairperson of BES Engineering Corporation. It has led to breakthroughs in our professionalism and board diversity, and is expected to facilitate our corporate governance and business decision-making in the future. CPDC also held a board meeting in the afternoon and elected the current Chairman Ruey-Long Chen to continue to serve as the Chairman of CPDC.
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• Annual profit of AN and CPL declines due to COVID-19
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•     In 2020, the Company reported full year consolidated revenue of NT$17.583 billion, net profit after tax of NT$675million, and earnings per share of NT$0.21. The profit decreased by 61% as compared with that in the prior year (2019). CPDC indicated that the main reason for the decline in the profit of the Company’s two main products, acrylonitrile (AN) and caprolactam (CPL) was the severe impact of COVID-19. Affected by the pandemic, the demand in the downstream textile industry of CPL plunged, and global CPL was sold to Taiwan in large quantities at low prices, which in turn undermined the Company's product sales, selling prices, and gross profit, resulting in a decrease of NT$178 million in profit from that in the prior year. With regard to AN, due to the spread of the pandemic, volatile oil prices, and increased supply from new production capacity, the selling price plummeted, resulting in a decrease of NT$1.749 billion in profit from that in the prior year.
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•     Although the overall operating environment in 2021 is still challenged by the pandemic, we saw the economy gradually recovered in the first half of the year. We expect the demand for both AN and CPL this year will grow by about 6% from 2020. While revenues and the overall profitability of the first half of 2021 have improved year-on-year, we are cautiously monitoring the market moving into the second half and continue on building our product competitiveness to solidify operating performance.
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• A two-pronged approach of petrochemical business and land development is adopted to strengthen the business layout
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•     Since 2018, the Company has adopted a two-pronged approach of petrochemical business and land development in business development to strengthen the overall strategic layout and to improve the business performance. In recent years, we have been actively transforming our petrochemical business into a specialized field. In addition to the acquisition of the Chainlon's Douliu Plant in 2020, we have completed the construction of the Qiaotou Plant and put it into operation. Furthermore, the construction of our fine chemical plant in Toufen was officially launched in early 2021, which will facilitate the vertical integration of our upstream and downstream businesses and further promote the development of diverse and high-value new products.
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•     CPDC stated that, as for land development, it will continue to revitalize the Company's land assets and carry out land development-related projects at home and abroad. The large area of land in the Asia New Bay Area in Kaohsiung put out to tender as announced a few days ago is an important milestone and our first move in asset revitalization. Although the bid opening of the project was postponed due to the impact of the pandemic, it has still drawn a great deal of market attention. In the near future, we will conduct subsequent planning and operations depending on the changes in the pandemic.
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• CPDC's efforts in ESG are recognized internationally
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•     Keeping abreast of the global ESG trend, the Company continues to make improvement and pursue excellence to strive towards corporate sustainability. In 2020, we actively participated in the S&P Global Corporate Sustainability Assessment and ranked 12th in the global chemical industry. We were also selected as a member of the S&P Global Sustainability Yearbook for the first time in 2021 as the only chemical company in Taiwan to be included in the yearbook while awarded the Industry Mover in the global chemical industry. In addition to international awards, we won the Taiwan TOP50 Sustainable Enterprise Award and the Gold Award of Corporate Sustainability Report at the 13th Taiwan Enterprise Sustainability Awards (TCSA). CPDC stated that it will adopt the sustainable development strategy of "forward-looking governance, smart production, communication and dialogue, and community care" to deepen the linkage between the United Nations Sustainable Development Goals (SDGs) and business operations in the future, to fulfill corporate social responsibilities actively and to strike a balance among the environment, society, and economy.
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Director Re-election is Completed at CPDC's 2021 Annual General Meeting.

CPDC held the 2021 AGM in accordance with the relevant provisions of the guidelines for epidemic prevention for AGM published by Financial Supervisory Commission.

The current Chairman Ruey-Long Chen to continue to serve as the Chairman of CPDC.