Formosa Plastics Announces Consolidated Financial Results for Q2 2026

1. Factual Date: 115/07/09

2. Company Name: Formosa Plastics Corporation

3. Relationship with Company (Please enter '本公司' or 'Subsidiary'):本公司 (Parent Company)

4. Cross-shareholding Ratio: Not applicable

5. Reason for Occurrence: Announcement of the Company's Consolidated Financial Results for Q2 2026

6. Response Measures: None

7. Other Matters to be Disclosed (If the subject of the event or resolution is a publicly issued company or above, this material information also meets the criteria under Article 7, Paragraph 9 of the Enforcement Rules of the Securities and Exchange Act, regarding matters that significantly affect shareholders' rights or securities prices):

I. Comparison of Consolidated Financial Results for Q2 2026 vs. Q1 2026:

(1) Consolidated revenue for Q2 2026 was NT$47.2 billion, an increase of NT$5.2 billion (12.5%) from the previous quarter. Details are as follows:

1. Sales price variance: Increased by NT$12.75 billion

The outbreak of the Iran-US war at the end of February led to the blockade of the Strait of Hormuz, disrupting crude oil and naphtha supplies from the Persian Gulf. This pushed up the Q2 2026 contract prices of Brent crude oil, ethylene, and propylene by 23.3%, 36.8%, and 37.8% respectively compared to Q1. As a result, the average selling prices of the Company's major products increased by 27% to 64% compared to Q1.

2. Sales volume variance: Decreased by NT$7.48 billion

Due to the Iran-US war at the end of February, Middle Eastern crude oil and naphtha could not be exported through the Strait of Hormuz. CPC Corporation and Formosa Petrochemical Corporation reduced ethylene and propylene supplies, leading the Company to lower production rates across its product lines. Additionally, in June, as the Middle East situation eased and crude oil prices declined, customer procurement became cautious and demand for petrochemical products weakened. Consequently, the total sales volume of the Company's major products in Q2 2026 decreased by 280,000 tons compared to Q1.

(2) Core business profit for Q2 2026 was NT$2.8 billion, a reversal from a loss of NT$1.3 billion in the previous quarter, representing an improvement of NT$4.1 billion. Consolidated pre-tax profit was NT$10.8 billion, an increase of NT$7.4 billion from the previous quarter. Earnings per share before tax were NT$1.71. Consolidated net profit was NT$10.6 billion, up NT$7.3 billion from the previous quarter. Net profit attributable to parent company shareholders was NT$1.67 per share. Details are as follows:

1. Affected by the Iran-US war, petrochemical product prices rose. Combined with the Company's low-cost inventory from earlier periods, product margins significantly improved, enabling the core business to turn profitable in Q2.

2. Equity-method investment income recognized at NT$8.35 billion, an increase of NT$3.3 billion from the previous quarter. Main components:

A. Formosa Petrochemical Corporation: NT$5.91 billion, up NT$210 million from the previous quarter;

B. Formosa Plastics USA Corporation: NT$1.88 billion, up NT$2 billion from the previous quarter, primarily due to the surge in petrochemical product prices caused by the Iran-US war, while U.S. natural gas and energy prices increased at a relatively smaller rate, expanding product margins;

C. Formosa Olefins USA Corporation: NT$1.11 billion, up NT$910 million from the previous quarter, primarily due to ethane feedstock prices rising less than ethylene product prices, leading to expanded margins.

3. Cash dividend income of NT$230 million in Q2.

4. Foreign exchange gain of NT$30 million in Q2, a decrease of NT$200 million compared to the foreign exchange gain of NT$230 million in Q1.

II. Comparison of Consolidated Financial Results for H1 2026 vs. H1 2025:

(1) Consolidated revenue for H1 2026 was NT$89.2 billion, a decrease of NT$3.3 billion (3.6%) from the same period last year. Details are as follows:

1. Sales volume variance: Decreased by NT$11.49 billion

H1 2026 was affected by the Iran-US war, as well as construction work on CPC's natural gas pipeline, scheduled maintenance at the Fourth Light Cracking Unit, and equipment failure at the New Third Light Cracking Unit, leading to reduced ethylene and propylene supplies from CPC and Formosa Petrochemical Corporation. The Company lowered its operating rates. As a result, the total sales volume of the Company's major products in H1 2026 decreased by 391,000 tons compared to the same period last year.

2. Sales price variance: Increased by NT$8.14 billion

Due to the Iran-US war, crude oil, ethylene, and propylene prices surged in H1 2026. The Company raised selling prices of its products to reflect rising raw material costs. As a result, the average prices of the Company's major products increased by 6% to 19% compared to the same period last year.

(2) Core business profit for H1 2026 was NT$1.5 billion, an improvement of NT$4 billion from a loss of NT$2.5 billion in the same period last year. Consolidated pre-tax profit was NT$14.2 billion, an increase of NT$20.9 billion from the same period last year. Earnings per share before tax were NT$2.24. Consolidated net profit was NT$13.9 billion, up NT$20.4 billion from the same period last year. Net profit attributable to parent company shareholders was NT$2.19 per share. Details are as follows:

1. In H1 last year, due to U.S. reciprocal tariffs, customer procurement was conservative, and new capacities from petrochemical peers came online successively, depressing market prices and resulting in core business losses. This year, affected by the Iran-US war, international crude oil and petrochemical product prices rose, significantly improving margins. As a result, the core business turned profitable in H1.

2. Equity-method investment income recognized at NT$13.39 billion, an increase of NT$14.6 billion from a loss of NT$1.21 billion in the same period last year. Main components:

A. Recognition from Formosa Petrochemical Corporation increased by NT$12.6 billion compared to the same period last year.

B. Recognition from Formosa Plastics USA Corporation increased by NT$2.3 billion compared to the same period last year, primarily due to rising product selling prices and expanded margins.

3. Cash dividend income of NT$230 million, an increase of NT$70 million from the same period last year.

4. Foreign exchange gain of NT$260 million in H1 this year, compared to a foreign exchange loss of NT$1.71 billion in the same period last year, representing an increase in gains of NT$1.97 billion.