Hanwha Total Petrochemical Co., Ltd. and its subsidiaries Consolidated financial statements for the years ended December 31, 2020 and 2019 with the independent auditor’s report Table of contents Independent auditor’s report Page Consolidated financial statements Consolidated statements of financial position 1 Consolidated statements of comprehensive income 3 Consolidated statements of changes in equity 4 Consolidated statements of cash flows 5 Notes to the consolidated financial statements 6 Ernst & Young Han Young Taeyoung Building, 111, Yeouigongwon-ro, Yeongdeungpo-gu, Seoul 07241 Korea Tel: +82 2 3787 6600 Fax: +82 2 783 5890 ey.com/kr Independent auditor’s report The Shareholders and Board of Directors Hanwha Total Petrochemical Co., Ltd. Opinion We have audited the consolidated financial statements of Hanwha Total Petrochemical Co., Ltd. (the “Company”) and its subsidiaries (collectively referred to as the “Group”), which comprise the consolidated statements of financial position as of December 31, 2020 and 2019, and the consolidated statements of comprehensive income, consolidated statements of changes in equity and consolidated statements of cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies. In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2020 and 2019, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with Korean International Financial Reporting Standards (“KIFRS”). Basis for opinion We conducted our audit in accordance with Korean Auditing Standards (“KGAAS”). Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in the Republic of Korea, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Responsibilities of management and those charged with governance for the consolidated financial statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with KIFRS, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Group’s financial reporting process. A member firm of Ernst & Young Global Limited Auditor’s responsibilities for the audit of the consolidated financial statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with KGAAS will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements. As part of an audit in accordance with KGAAS, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. March 16, 2021 This audit report is effective as of March 16, 2021, the independent auditor’s report date. Accordingly, certain material subsequent events or circumstances may have occurred during the period from the independent auditor’s report date to the time this report is used. Such events and circumstances could significantly affect the accompanying consolidated financial statements and may result in modifications to this report. A member firm of Ernst & Young Global Limited Hanwha Total Petrochemical Co., Ltd. and its subsidiaries Consolidated financial statements for the years ended December 31, 2020 and 2019 “The accompanying consolidated financial statements, including all footnotes and disclosures, have been prepared by, and are the responsibility of, the Group.” Jong Seo Kim & Thierry Boulfroy Chief Executive Officers Hanwha Total Petrochemical Co., Ltd. Hanwha Total Petrochemical Co., Ltd. and its subsidiaries Consolidated statements of financial position as of December 31, 2020 and 2019 (Korean won) Notes 2020 2019 Assets Current assets: Cash and cash equivalents 3 \ 231,451,124,896 \ 368,644,459,888 Short-term investment securities 3 90,834,800,000 - Trade and other 3,4,13, accounts receivable, net 22,24 606,333,255,566 828,016,299,699 Prepaid expenses 16,640,694,136 13,165,106,658 Other current assets 2,508,006,515 3,522,632,866 Inventories, net 5 1,061,699,446,067 1,232,322,655,434 Total current assets 2,009,467,327,180 2,445,671,154,545 Non-current assets: Long-term investment securities 3,6 16,870,305,966 12,167,615,478 Long-term loans, net 3,4 949,384,680 262,975,703 Long-term accounts receivable, net 3,4,24 3,538,133,847 3,788,023,385 Long-term prepaid expenses 54,402,395,386 54,588,551,372 Property, plant and equipment, net 7,8,23 4,538,254,282,160 4,517,823,813,389 Intangible assets, net 9,23 31,510,628,005 32,963,059,867 Defined benefit assets, net 12 4,725,934,016 - Other non-current assets 3 15,500,000 15,500,000 Deferred tax assets 18 7,269,016,257 9,929,433,794 Total non-current assets 4,657,535,580,317 4,631,538,972,988 Total assets \ 6,667,002,907,497 \ 7,077,210,127,533 (Continued) 1 1 Hanwha Total Petrochemical Co., Ltd. and its subsidiaries Consolidated statements of financial position as of December 31, 2020 and 2019 (cont'd) (Korean won) Notes 2020 2019 Liabilities Current liabilities: Trade and other accounts payable 3,13,14,22 \ 592,264,516,317 \ 830,246,977,710 Short-term borrowings 3,4,10,21,24 94,768,700,797 134,025,576,583 Current portion of bonds payable 3,8,10, and long-term borrowings 21,24 603,994,382,294 424,291,143,279 Income tax payable 20,013,674,145 41,998,213,264 Other current liabilities 11 33,883,695,449 11,113,333,623 Total current liabilities 1,344,924,969,002 1,441,675,244,459 Non-current liabilities: Bonds payable, net 3,10,21,24 1,340,919,474,134 1,736,815,858,250