MIRA INFORM REPORT

Report No. :	505359
Report Date :	27.04.2018

IDENTIFICATION DETAILS

Name :	FORMOSA CHEMICALS & FIBRE CORP.
Registered Office :	No. 359, Chungshan Road, Sec. 3, Chang Hwa City, Chang Hwa County
Country :	Taiwan
Financials (as on) :	31.12.2017
Date of Incorporation :	05.03.1965
Com. Reg. No.:	58650902
Legal Form :	Joint Stock Company
Line of Business :	Manufacture and Sale of Chemicals, etc.
No. of Employees :	About 5,000

RATING & COMMENTS

(Mira Inform has adopted New Rating mechanism w.e.f. 23^rd January 2017)

MIRA’s Rating :

A++

Credit Rating	Explanation	Rating Comments
A++	Minimum Risk	Business dealings permissible with minimum risk of default

Status :	Excellent
Payment Behaviour :	Regular
Litigation :	Clear

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List

Country Name	Previous Rating (30.09.2017)	Current Rating (31.12.2017)
Taiwan	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low Risk	A2
Moderately Low Risk	B1
Moderate Risk	B2
Moderately High Risk	C1
High Risk	C2
Very High Risk	D

TAIWAN - ECONOMIC OVERVIEW

Taiwan has a dynamic capitalist economy that is driven largely by industrial manufacturing, and especially exports of electronics, machinery, and petrochemicals. This heavy dependence on exports exposes the economy to fluctuations in global demand. Taiwan's diplomatic isolation, low birth rate, rapidly aging population, and increasing competition from China and other Asia Pacific markets are other major long-term challenges.

Following the landmark Economic Cooperation Framework Agreement (ECFA) signed with China in June 2010, Taiwan in July 2013 signed a free trade deal with New Zealand - Taipei’s first-ever with a country with which it does not maintain diplomatic relations - and, in November of that year, inked a trade pact with Singapore. However, follow-on components of the ECFA, including a signed agreement on trade in services and negotiations on trade in goods and dispute resolution, have stalled. In early 2014, the government bowed to public demand and proposed a new law governing the oversight of cross-Strait agreements, before any additional deals with China are implemented; the legislature has yet to vote on such legislation, leaving the future of ECFA uncertain. President TSAI since taking office in May 2016 has promoted greater economic integration with South and Southeast Asia through the New Southbound Policy initiative and has also expressed interest in Taiwan joining the Trans-Pacific Partnership as well as bilateral trade deals with partners such as the US. These overtures have likely played a role in increasing Taiwan’s total exports, which rose 11% during the first half of 2017, buoyed by strong demand for semiconductors.

Taiwan's total fertility rate of just over one child per woman is among the lowest in the world, raising the prospect of future labor shortages, falling domestic demand, and declining tax revenues. Taiwan's population is aging quickly, with the number of people over 65 expected to account for nearly 20% of the island's total population by 2025.

The island runs a trade surplus with many economies, including China and the US, and its foreign reserves are the world's fifth largest, behind those of China, Japan, Saudi Arabia, and Switzerland. In 2006, China overtook the US to become Taiwan's second-largest source of imports after Japan. China is also the island's number one destination for foreign direct investment. Taiwan since 2009 has gradually loosened rules governing Chinese investment and has also secured greater market access for its investors on the mainland. In August 2012, the Taiwan Central Bank signed a memorandum of understanding (MOU) on cross-Strait currency settlement with its Chinese counterpart. The MOU allows for the direct settlement of Chinese renminbi (RMB) and the New Taiwan dollar across the Strait, which has helped Taiwan develop into a local RMB hub.

Closer economic links with the mainland bring opportunities for Taiwan’s economy but also pose challenges as political differences remain unresolved and China’s economic growth is slowing. President TSAI’s administration has made little progress on the domestic economic issues that loomed large when she was elected, including concerns about stagnant wages, high housing prices, youth unemployment, job security, and financial security in retirement. TSAI has made more progress on boosting trade with South and Southeast Asia, however, which may help insulate Taiwan’s economy from a fall in mainland demand should China’s growth slow in 2018.

Source : CIA

Contact Points

Company Name:	FORMOSA CHEMICALS & FIBRE CORP.
Supplied Name:	FORMOSA CHEMICALS & FIBRE CORP
Trading Address:	No. 201, Tung Hwa North Road, Taipei City, Taiwan
Supplied Address:	201, Tung Hwa North Rd, Taipei, Roc
Telephone Number:	+886-2-2712-2211
Fax Number:	+886-2-2713-3229
E-mail:	marketing@fcfc.com.tw
Website:	www.fcfc.com.tw

Notes: Subject’s exact name and address are as above.

Company Identification Details

Registered Name:	FORMOSA CHEMICALS & FIBRE CORP.
Registered Address:	No. 359, Chungshan Road, Sec. 3, Chang Hwa City, Chang Hwa County, Taiwan
Date of Foundation:	1965-03-05
Registration Number:	58650902
Registry:	Department of Commerce, Ministry of Economic Affairs, R.O.C.
Registered Capital:	NTD 58,611,862,910 (USD 1,758,355,887) (As of 2018.4, 1 NTD = 0.03 USD)
Paid-up Capital:	NTD 58,611,862,910 (USD 1,758,355,887 )
Legal Representatives:	Wenyuan Wang
Legal Form:	Joint Stock Company
Principal Activities:	Manufacture and sale of chemicals, etc.
Staff:	About 5,000 Employees (Group)
Listed at Stock Exchange:	Yes; Stock Symbol:1326
Date of Last Annual Return:	2018-2-2

History

Subject was incorporated on 1965-03-05 with registered number 58650902 as Joint Stock Company in Taiwan.

Subject listed on Taiwan Stock Exchange on 1984-12-20.

Corporate Structure

Factories

1
Name:	Xingang Factory
Address:	No. 1, Zhongyang Industrial Park, Zhongyang Village, Jiayi County, Taiwan
Date of Foundation:	1987-04-10
Date of Registration:	1988-12-07
Factory Registration Number:	99655041
Factory Manager:	Wenjin Lv
Status:	In Production
Date of Last Annual Return:	2015-01-05
Major Product:	111 Spinning 112 Weaving 152 Paper container 185 Synthetic Fiber 184 Synthetic resin, plastic and rubber 292 Other special machinery equipment
2
Name:	Mailiao Factory
Address:	No. 3-1 and 5, Taisu Industrial Park, Zhongxing Village, Mailiao Xiang, Yunlin County, Taiwan
Date of Foundation:	1996-06-05
Date of Registration:	1998-12-23
Factory Registration Number:	99653069
Factory Manager:	Yingda Fang
Status:	In Production
Date of Last Annual Return:	2017-3-2
Major Product:	181 Basic chemical materials 182 Petrochemical materials 184 Synthetic resin, plastic and rubber
3
Name:	Haifeng Factory
Address:	No. 23, Taisu Industrial Park, Zhongxing Village, Mailiao Xiang, Yunlin County, Taiwan
Date of Foundation:	1999-07-20
Date of Registration:	2000-12-29
Factory Registration Number:	99653067
Factory Manager:	Yingda Fang
Status:	In Production
Date of Last Annual Return:	2017-3-2
Major Product:	181 Basic chemical materials 182 Petrochemical materials 184 Synthetic resin, plastic and rubber

Branches:

1
Name	Mailiao Branch
Address	No. 1-1, Formosa Plastics Group Industrial Zone, Mailiao, Yun Lin County, Taiwan
Registration Number	89283092
Date of Registration	1994-09-16
Status	Live Company
Date of Last Annual Return	2017-4-6
2
Name	Longde Branch
Address	No.2, 10 Longxiang Road, Tungshan Village, Ilan County, Taiwan
Registration Number	84309657
Date of Registration	1994-02-03
Status	Live Company
Date of Last Annual Return	2004-12-24
3
Name	Yilan Branch
Address	No.155, Tanfu Road, Longtan village, Jiaosi Township, Ilan County, Taiwan
Registration Number	84309642
Date of Registration	1994-02-03
Status	Live Company
Date of Last Annual Return	2004-12-21
4
Name	Hsinkang Branch
Address	1, Chung-Yang Industrial Park, Hsinkang Hsiang, Chiayi-Hsien, Taiwan
Registration Number	84309636
Date of Registration	1994-02-03
Status	Live Company
Date of Last Annual Return	2014-11-21
5
Name	Taipei Branch
Address	2 Floor, No.24, 201 Tung Hwa North Road, Taipei, Taiwan
Registration Number	80026278
Date of Registration	2003-07-07
Status	Live Company
Date of Last Annual Return	--

Shareholders

Major Shareholders

Name	Subscription Shares
Wenyuan Wang	129,198,084
Fuyuan Hong	272,804
Wenchao Wang	16,867,218
Nan Ya Plastics Corporation	140,519,648
Formosa Petrochemical Corporation	48,567,575
Qiuming Chen	79,627
Dongteng Huang	34,410
Yingda Fang	73
Sunru Li	15,450
Hongzhi Yang	152,289
Wenjin Lv	3,236

Shareholder Information:

1
Registered Name:	Nan Ya Plastics Corporation
Registered Address:	No.101, Shuiguan Rd., Renwu Dist., Kaohsiung City, Taiwan
Date of Foundation:	1958-08-22
Registration Number:	75370905
Registry:	Department of Commerce, Ministry of Economic Affairs, R.O.C.
Registered Capital:	NTD 79,308,215,890
Paid-up Capital:	NTD 79,308,215,890
Legal Representatives:	Jiazhao Wu
Legal Form:	Joint Stock Company
Date of Last Annual Return:	2017-07-04
2
Registered Name:	Formosa Petrochemical Corporation
Registered Address:	No.1-1, Formosa Plastic Group Industrial Zone, Mailiao Township, Yunlin County, Taiwan
Date of Foundation:	1992-4-6
Registration Number:	86522210
Registry:	Department of Commerce, Ministry of Economic Affairs, R.O.C.
Registered Capital:	NTD 95,259,596,520
Paid-up Capital:	NTD 95,259,596,520
Legal Representatives:	Baolang Chen
Legal Form:	Joint Stock Company
Date of Last Annual Return:	2017-12-19

Management Information

Core Management

Directors

1
Name	Wenyuan Wang
Position:	Chairman of the Board
2
Name	Fuyuan Hong
Position	Vice Chairman
3
Name	Wenchao Wang
Position	Managing Director
4
Name	Ruiyu Wang
Position	Managing Director
5
Name	Ruilong Chen
Position	Managing Director/ Independent Director
6
Name	Zongyong Lin
Position	Independent Director
7
Name	Gong Wang
Position	Independent Director
8
Name	Wenneng Weng
Position	Director
9
Name	Wenxiang Wang
Position	Director
10
Name	Qiuming Chen
Position	Director& Manager
Date of Appointment for Manager	2006-06-16
11
Name	Dongteng Huang
Position	Director& Manager
Date of Appointment for Manager	2006-06-16
12
Name	Yingda Fang
Position	Director& Manager
Date of Appointment for Manager	2009-03-26
13
Name	Sunru Li
Position	Director
14
Name	Hongzhi Yang
Position	Director
15
Name	Wenjin Lv
Position	Director
Date of Appointment for Manager	2011-11-29
16
Name	Qingci Lin
Position	Manager
Date of Appointment	2006-06-16
17
Name	Zhixiong Chen
Position	Manager
Date of Appointment	2009-03-26
18
Name	Junrong Su
Position	Manager
Date of Appointment	2014-11-07
19
Name	Jinhua Pan
Position	Manager
Date of Appointment	2014-11-07
20
Name	Zongyuan Zhang
Position	Manager
Date of Appointment	2014-11-07
21
Name	Qingfen Li
Position	Manager
Date of Appointment	2014-11-07
22
Name	Tianzhong Huang
Position	Manager
Date of Appointment	2015-11-06
23
Name	Baile Ke
Position	Manager
Date of Appointment	2015-11-06
24
Name	Weigeng Jian
Position	Manager
Date of Appointment	2017-3-17

Personnel Structure

Total Employees

About 5,000 Employees (Group)

Operation Information

Offices & Factories

	Headquarters
Add	No. 201, Tung Hwa North Road, Taipei City, Taiwan

Production Information

Subject is engaged in manufacturing of chemicals, etc.

Subject has factories in Taiwan for production.

Subject has obtained the certification of ISO 9002, etc.

Subject’s divisions are as follows for your reference:

Division	Major Business
1st Petrochemicals Division	Manufacturing and sales of AROMA.
2^nd Petrochemicals Division	Manufacturing and sales of SM, phenol, and acetone.
3rd Petrochemicals Division	Manufacture and sales of PTA.
Nylon Division	Manufacturing and sales of rayon, polyester, acrylic, cotton, open-end, vortex spinning.
Textiles Division	Manufacturing and sales of yarn, short-fiber cloth, and long-fiber cloth.
Engineering & Utility Division	Manufacturing and sales of electricity, steam, pure water, soft water, filtered water, chilled water and compressed air.
Plastics Division	Manufacture and sales of PS, ABS, SAN, ASA, PP, PC and PC/ABS alloys pellet.
Rayon Division	Manufacturing and sales of rayon staple fiber.

Purchase Information

The registered activities of subject:

Business Code	Details
A201010	Afforestation business
A202040	Felling operation
C301010	manufacturing of yarn
C302010	weaving cotton cloth
C305010	Printing and dyeing finishing industry
C501010	The lumber industry
C601010	The pulp manufacturing
C801010	Basic chemicals business
C801020	Manufacturing of petrochemical materials
C801030	Manufacturing of precision chemical materials
C801100	Manufacturing of synthetic resin and plastic
C801120	Manufacturing of artificial fiber
C801990	Manufacturing of other chemical materials
C802080	Manufacturing of environmental medicine
C802090	Manufacturing of cleaning supplies
C802100	Manufacturing of cosmetics
C901990	Manufacturing of other nonmetallic mineral
CB01010	Manufacturing of mechanical equipment
CC01080	Manufacturing of electronic components
D101050	Electricity, a total of profession
E502010	Engineering of fuel line
E599010	Engineering of tubing
E601010	Electrical installation industry
E603010	Installation of cable
E603040	Installation of fire control equipment
E603050	Automatic control equipment engineering
E603090	Installation of lighting equipment
E603100	Welding engineering
E603110	Cold work engineering
E603120	Sand blasting engineering
E604010	The machinery installation industry
E605010	Computer equipment installation industry
E901010	Paint engineering
E903010	Corrosion and rust prevention engineering
EZ02010	Lifting engineering
EZ05010	Instrument, instrument installation engineering
EZ15010	Thermal insulation, cold insulation installation engineering
ZZ99999	Besides licensed business, all other business items those are not banned or restricted.

The raw materials of the subject for production are purchased both at Taiwan local market and abroad including Mexico, etc.

Sales Information

Subject is engaged in sales of chemicals, etc.

The major products of the subject are petrochemical products, including PTA, PS, AN, Butadiene, SM polymer, SM, benzene, toulene, p-xylene (PX) and o-xylene (OX), nylon fiber, and rayon staple fiber, etc.

Subject’s sales regions cover domestic market, Malaysia, Singapore, Japan, Korea, other Asian countries, Europe and America, etc.

Major products of the subject are as follows for your reference.

Type	Product
Petrochemicals	Benzene Para-Xylene (PX) Ortho- Xylene (OX) Styrene Monomer (SM) Phenol Acetone PTA Anhydrous Sodium-Sulfate
Textile, Fiber	Rayon Staple Fiber Nylon Fiber Yarn Products Cloth Products
Plastic	Polystyrene (PS) ABS Resin PP Resin PC Resin PC/ABS Resin SAN Resin ASA Resin Nylon-6 Resin

Import and export right:

Import right	Yes
Export right	Yes

Settlements

Purchase

Domestic Purchase

Products	Raw materials, etc.
Payment Terms	T/T, Cash, etc.

Import

Products	Raw materials, etc.
Payment Terms	L/C, T/T, etc.

Sales

Domestic Markets

Product	Chemicals, etc.
Selling Terms	T/T, Cash, etc.

Export

Product	Chemicals, etc.
Selling Terms	L/C, T/T, etc.

Balance Sheet

Unit: NTD/000

Consolidated	2017-12-31	2016-12-31
Assets
Current assets
Cash and cash equivalents
Total cash and cash equivalents	29,684,599	30,391,911
Current financial assets at fair value through profit or loss
Total current financial assets at fair value through profit or loss	630,396	627,621
Current available-for-sale financial assets
Current available-for-sale financial assets, net	117,617,800	100,777,992
Notes receivable, net
Notes receivable, net	10,971,286	7,037,751
Notes receivable due from related parties, net
Notes receivable due from related parties, net	13,006	11,643
Accounts receivable, net
Accounts receivable, net	21,653,085	18,028,975
Accounts receivable due from related parties, net
Accounts receivable due from related parties, net	9,049,561	7,356,435
Other receivables
Other receivables, net	7,366,582	5,107,594
Other receivables due from related parties
Other receivables due from related parties, net	13,727,806	19,841,060
Inventories
Total inventories	38,837,031	42,215,280
Other current assets
Total other current assets	4,291,251	5,409,066
Total current assets	253,842,403	236,805,328
Non-current assets
Non-current available-for-sale financial assets
Non-current available-for-sale financial assets, net	43,994,286	42,381,294
Non-current financial assets at cost
Non-current financial assets at cost, net	25,093,528	24,431,806
Investments accounted for using equity method
Investments accounted for using equity method, net	112,476,716	102,035,137
Property, plant and equipment
Total property, plant and equipment	125,345,618	130,913,460
Intangible assets
Total intangible assets	1,042	1,583
Deferred tax assets	1,883,829	1,732,954
Other non-current assets
Total other non-current assets	9,689,071	6,135,028
Total non-current assets	318,484,090	307,631,262
Total assets	572,326,493	544,436,590
Liabilities and equity
Liabilities
Current liabilities
Short-term borrowings
Total short-term borrowings	23,142,134	26,146,750
Short-term notes and bills payable
Total short-term notes and bills payable	1,579,763	1,499,464
Current financial liabilities at fair value through profit or loss
Total current financial liabilities at fair value through profit or loss	0	1,381
Notes payable
Total notes payable	199,518	196,870
Accounts payable
Total accounts payable	7,500,163	8,525,984
Accounts payable to related parties
Total accounts payable to related parties	17,949,939	13,385,510
Other payables
Total other payables	10,693,867	8,387,052
Other payables to related parties	118,800	57,478
Current tax liabilities	3,927,165	3,708,596
Other current liabilities
Long-term liabilities, current portion
Total long-term liabilities, current portion	12,174,978	14,416,502
Other current liabilities, others	5,139,667	2,884,328
Total other current liabilities	17,314,645	17,300,830
Total current liabilities	82,425,994	79,209,915
Non-current liabilities
Bonds payable
Total bonds payable	34,050,000	39,750,000
Long-term borrowings
Total long-term borrowings	29,795,576	38,614,620
Deferred tax liabilities
Total deferred tax liabilities	259,691	312,506
Other non-current liabilities
Total other non-current liabilities	7,294,156	6,909,137
Total non-current liabilities	71,399,423	85,586,263
Total liabilities	153,825,417	164,796,178
Equity
Equity attributable to owners of parent
Share capital
Ordinary share	58,611,863	58,611,863
Total capital stock	58,611,863	58,611,863
Capital surplus
Capital surplus, additional paid-in capital
Total capital surplus, additional paid-in capital	8,224,586	8,224,586
Capital surplus, treasury share transactions	203,232	159,382
Capital surplus, difference between consideration and carrying amount of subsidiaries acquired or disposed	9,447	9,447
Capital surplus, changes in equity of associates and joint ventures accounted for using equity method	29,307	25,003
Capital surplus, others	216,226	204,224
Total capital surplus	8,682,798	8,622,642
Retained earnings
Legal reserve	51,046,840	46,663,535
Special reserve	46,567,089	41,927,550
Unappropriated retained earnings (accumulated deficit)
Total unappropriated retained earnings (accumulated deficit)	84,218,728	72,560,103
Total retained earnings	181,832,657	161,151,188
Other equity interest
Exchange differences on translation of foreign financial statements
Total exchange differences on translation of foreign financial statements	-2,052,251	988,624
Unrealized gains (losses) on available-for-sale financial assets
Total unrealized gains (losses) on available-for-sale financial assets	111,213,200	90,933,647
Gains (losses) on effective portion of cash flow hedges
Total gains (losses) on effective portion of cash flow hedges	8,077	43,174
Total other equity interest	109,169,026	91,965,445
Treasury shares	626,468	360,572
Total equity attributable to owners of parent	357,669,876	319,990,566
Non-controlling interests	60,831,200	59,649,846
Total equity	418,501,076	379,640,412
Total liabilities and equity	572,326,493	544,436,590
Number of share capital awaiting retirement	0	0
Equivalent issue shares of advance receipts for ordinary share	0	0
Number of shares in entity held by entity and by its subsidiaries	27,418,610	18,535,610

Profit and Loss Account

Unit: NTD/000

Consolidated	2017	2016
Operating revenue
Total operating revenue	358,421,471	319,204,627
Operating costs
Total operating costs	305,225,269	271,653,073
Gross profit (loss) from operations	53,196,202	47,551,554
Gross profit (loss) from operations	53,196,202	47,551,554
Operating expenses
Selling expenses
Total selling expenses	8,665,339	8,524,812
Administrative expenses
Total administrative expenses	5,616,799	5,591,090
Total operating expenses	14,282,138	14,115,902
Net operating income (loss)	38,914,064	33,435,652
Non-operating income and expenses
Other income
Total other income	9,591,374	7,926,142
Other gains and losses
Other gains and losses, net	1,402,771	-3,714,696
Finance costs
Finance costs, net	2,322,704	1,993,143
Share of profit (loss) of associates and joint ventures accounted for using equity method
Share of profit (loss) of associates and joint ventures accounted for using equity method, net	19,121,378	19,021,711
Total non-operating income and expenses	27,792,819	21,240,014
Profit (loss) from continuing operations before tax	66,706,883	54,675,666
Tax expense (income)
Total tax expense (income)	6,670,937	5,908,938
Profit (loss) from continuing operations	60,035,946	48,766,728
Profit (loss)	60,035,946	48,766,728
Other comprehensive income
Components of other comprehensive income that will not be reclassified to profit or loss
Gains (losses) on remeasurements of defined benefit plans	-658,371	-505,220
Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will not be reclassified to profit or loss
Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will not be reclassified to profit or loss	-248,319	-23,805
Components of other comprehensive income that will not be reclassified to profit or loss	-906,690	-529,025
Components of other comprehensive income that will be reclassified to profit or loss
Exchange differences on translation	-3,985,822	-4,757,556
Unrealised gains (losses) on valuation of available-for-sale financial assets	18,771,483	24,960,906
Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss
Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss	2,048,005	1,081,694
Income tax related to components of other comprehensive income that will be reclassified to profit or loss	-385,061	-591,147
Components of other comprehensive income that will be reclassified to profit or loss	17,218,727	21,876,191
Other comprehensive income, net	16,312,037	21,347,166
Total comprehensive income	76,347,983	70,113,894
Profit (loss), attributable to:
Profit (loss), attributable to owners of parent	54,410,802	43,833,045
Profit (loss), attributable to non-controlling interests	5,625,144	4,933,683
Comprehensive income attributable to:
Comprehensive income, attributable to owners of parent	70,707,693	57,934,824
Comprehensive income, attributable to non-controlling interests	5,640,290	12,179,070
Basic earnings per share
Basic earnings (loss) per share from continuing operations	10.29	8.35
Basic earnings (loss) per share from discontinued operations	-0.96	-0.85
Total basic earnings per share	9.33	7.50

Cash Flows

Unit: NTD/000

Consolidated	2016	2015
Cash flows from (used in) operating activities, indirect method
Profit (loss) from continuing operations before tax	66,706,883	54,675,666
Profit (loss) before tax	66,706,883	54,675,666
Adjustments
Adjustments to reconcile profit (loss)
Depreciation expense	14,472,479	16,029,866
Amortization expense	3,353,928	4,311,872
Net loss (gain) on financial assets or liabilities at fair value through profit or loss	-4,156	-1,598
Interest expense	2,322,704	1,993,143
Interest income	-544,054	-411,097
Dividend income	-7,464,957	-6,243,361
Share of loss (profit) of associates and joint ventures accounted for using equity method	-19,121,378	-19,021,711
Loss (gain) on disposal of property, plan and equipment	-840,582	-18,206
Loss (gain) on disposal of investments	-2,177,153	-181,168
Impairment loss on financial assets	0	207,066
Impairment loss on non-financial assets	0	781,222
Reversal of impairment loss on non-financial assets	-3,090	0
Other adjustments to reconcile profit (loss)	-86,032	498,306
Total adjustments to reconcile profit (loss)	-10,092,291	-2,055,666
Changes in operating assets and liabilities
Changes in operating assets
Decrease (increase) in financial assets held for trading	0	30,350
Decrease (increase) in notes receivable	-3,933,535	-455,842
Decrease (increase) in notes receivable due from related parties	-1,363	-6,408
Decrease (increase) in accounts receivable	-3,624,110	-3,346,671
Decrease (increase) in accounts receivable due from related parties	-1,693,126	-536,115
Decrease (increase) in other receivable	-2,245,762	2,752,270
Decrease (increase) in inventories	3,402,327	-2,661,979
Decrease (increase) in other current assets	1,117,815	920,990
Decrease (increase) in other operating assets	-157,561	1,013,421
Total changes in operating assets	-7,135,315	-2,289,984
Changes in operating liabilities
Increase (decrease) in notes payable	2,648	-3,257
Increase (decrease) in accounts payable	-1,025,821	1,589,095
Increase (decrease) in accounts payable to related parties	4,564,429	1,097,915
Increase (decrease) in other payable	2,590,521	231,130
Increase (decrease) in other current liabilities	2,255,339	683,043
Increase (decrease) in net defined benefit liability	-303,144	-4,901,984
Total changes in operating liabilities	8,083,972	-1,304,058
Total changes in operating assets and liabilities	948,657	-3,594,042
Total adjustments	-9,143,634	-5,649,708
Cash inflow (outflow) generated from operations	57,563,249	49,025,958
Interest received	574,670	396,562
Dividends received	21,910,714	17,438,601
Interest paid	-2,390,222	-2,032,885
Income taxes refund (paid)	-6,418,252	-5,114,947
Net cash flows from (used in) operating activities	71,240,159	59,713,289
Cash flows from (used in) investing activities
Acquisition of available-for-sale financial assets	-4,134,669	-5,478,021
Proceeds from disposal of available-for-sale financial assets	6,326,172	228,802
Acquisition of financial assets at cost	-2,327,575	-104
Proceeds from disposal of financial assets at cost	69,754	40,357
Proceeds from capital reduction of financial assets at cost	23,549	10,704
Acquisition of investments accounted for using equity method	-3,862,100	-1,361,880
Proceeds from disposal of investments accounted for using equity method	0	8,760
Acquisition of property, plant and equipment	-11,881,773	-8,963,930
Proceeds from disposal of property, plant and equipment	1,011,698	67,473
Increase in other receivables due from related parties	0	-9,987,748
Decrease in other receivables due from related parties	6,113,254	0
Acquisition of intangible assets	-432	-234
Increase in other non-current assets	-6,802,015	-2,713,339
Net cash flows from (used in) investing activities	-15,464,137	-28,149,160
Cash flows from (used in) financing activities
Decrease in short-term loans	-3,004,616	-525,898
Increase in short-term notes and bills payable	80,299	0
Decrease in short-term notes and bills payable	0	-549,900
Repayments of bonds	-6,750,000	-9,500,000
Proceeds from long-term debt	12,554,576	13,989,866
Repayments of long-term debt	-21,387,832	-12,474,284
Increase in guarantee deposits received	30,860	5,522
Increase in other payables to related parties	61,322	0
Decrease in other payables to related parties	0	-2,289,031
Decrease in other non-current liabilities	-1,068	-45,849
Cash dividends paid	-32,814,574	-21,932,687
Change in non-controlling interests	-4,464,858	-2,866,605
Net cash flows from (used in) financing activities	-55,695,891	-36,188,866
Effect of exchange rate changes on cash and cash equivalents	-787,443	272,509
Net increase (decrease) in cash and cash equivalents	-707,312	-4,352,228
Cash and cash equivalents at beginning of period	30,391,911	34,744,139
Cash and cash equivalents at end of period	29,684,599	30,391,911
Cash and cash equivalents reported in the statement of financial position	29,684,599	30,391,911

Note: Subject didn’t submit its individual financial information; we obtained its consolidated financials as above for reference.

The above financial figures are based on the IFRSs Accounting System.

Bankers

Name	Bank of Taiwan

Public Record

Mortgage

No chattel mortgage record of subject has been found within the recent 3 months.

Lawsuit

1
Trial Number:	2005,Zhangxiao,23
Date of Trial:	2005-03-17
Reason:	Payment of damage
Claimant:	Not Stated
Defendant:	Formosa Chemicals & Fibre Corp.
2
Trial Number:	2005,Zhangxiao,23
Date of Trial:	2005-04-13
Reason:	Payment of Damage
Claimant:	Not Stated
Defendant:	Formosa Chemicals & Fibre Corp.
3
Trial Number:	2004,Zhangjian,295
Date of Trial:	2004-11-11
Reason:	Payment of Pensions
Claimant:	Not Stated
Defendant:	Formosa Chemicals & Fibre Corp.

Special Note

Interview Details

Department

Sales Department

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	INR 66.83
UK Pound	1	INR 93.17
Euro	1	INR 81.37
TWD	1	INR 2.25

Note : Above are approximate rates obtained from sources believed to be correct

INFORMATION DETAILS

Analysis Done by :	NIY
Report Prepared by :	TPT

RATING EXPLANATIONS

Credit Rating	Explanation	Rating Comments
A++	Minimum Risk	Business dealings permissible with minimum risk of default
A+	Low Risk	Business dealings permissible with low risk of default
A	Acceptable Risk	Business dealings permissible with moderate risk of default
B	Medium Risk	Business dealings permissible on a regular monitoring basis
C	Medium High Risk	Business dealings permissible preferably on secured basis
D	High Risk	Business dealing not recommended or on secured terms only
NB	New Business	No recommendation can be done due to business in infancy stage
NT	No Trace	No recommendation can be done as the business is not traceable

NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors are as follows:

· Financial condition covering various ratios

· Company background and operations size

· Promoters / Management background

· Payment record

· Litigation against the subject

· Industry scenario / competitor analysis

· Supplier / Customer / Banker review (wherever available)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.