#1China Airlines 2023 2nd Investor Conference NOV.23.'23 CHINA AIRLINES EAM-#2Disclaimer The information disclosed in this presentation and its accompanying announcements, including content relating to business outlooks, financial operations, and business forecasts, is based on information derived from internal corporate data and external economic developments as a whole. The Company is not responsible for updating or making adjustments to the contents of this presentation to reflect the actual needs of the market, the latest policies or the ongoing changes of the economics. This information disclosed here only represents the outlooks based upon the available data for the current time and does not indicate or ensure the actual performance in the future. Neither should the data be taken as the full statement of the future development of the company nor the industrial phenomena. For the convenience of readers, this presentation has been translated into English from an original Chinese version. If there is any conflict between these two versions any misinterpretation in place, information in the Chinese version shall prevail. CHINA AIRLINES 2#3Agenda ✈ 2023Q1-Q3 Operating Performance Operating Challenges ✈ Passenger Market, Performance & Strategies Cargo Market, Performance & Strategies Fleet Development Sustainability Actions and Achievements CHINA AIRLINES 3#4CHINA AIRLINES 2023 Q1-Q3 Operating Results EAM-#52023 Q1-Q3 Financial Performance (NTD 100 Million) 2023 Q1-Q3 2022 Q1-Q3 Differences YOY Operating revenue Passenger revenue 866.2 122.8 743.4 605.4% Cargo revenue 424.3 928.1 -503.8 -54.3% Other operating revenue 85.1 66.9 18.2 27.2% Net Operating Income 90.7 42.5 48.2 113.6% Net Income After Tax 74.0 31.4 42.6 135.6% Net Income Attributable to 69.0 36.2 32.8 90.7% Owners of the company Earnings Per Share (TWD) 1.15 0.60 0.55 91.7% CHINA AIRLINES Based on consolidated financial report 5#6Operating Revenue by Source ✈ Passenger revenue have exceeded cargo revenue becoming the largest revenue share representing 60% from 2023 Q2 Currency: NTD100 million 140 120 100 80 60 40 20 Monthly revenue Pax rev Cgo rev Other rev 0 1 2 3 4 5 6 7 8 9 10 2022 CHINA AIRLINES Based on individual financial report 11 12 1 2 3 4 56789 2023 6#7The growth operating revenue in 2023 ✈ The operating revenue over the first nine months of 2023 increased by 14.7% compared with the same period last year. Mostly contributed by the 719.4% annual growth rate of passenger revenue, the passenger revenue from all regions increased significantly. NTD100 million 420 Quarterly revenue 2023Q1-Q3 passenger revenue distribution by region (YoY) 400 North 380 America, +579% Europe, +479% North East Asia +3,497% 360 2023 Q2, 2023 Q3, 413.69 China +382% 412.78 2023 Q1, South East Asia, +465% 340 379.54 2022 Q1, 2022 Q2, 320 353.47 2022 Q3, 351.69 2022 Q4, 359.24 346.31 Oceanic, +674% 300 CHINA AIRLINES Based on individual financial report 7#8Cost Breakdown and Comparison 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2023Q1-Q3 34.0% 16.6% 14.5% 14.3% 10.3% 10.3% Fuel Rental, Depr. & Amortization Airport & Labor Maint. ground Passenger service, Sales & OTH handling 2022Q1-Q3 40.1% 18.2% 14.1% 13.6% 9.0% 5.0% CHINA AIRLINES Based on individual financial report 8#9Fuel Cost Analysis Unit 2023Q1-Q3 2022Q1-Q3 YOY Jet fuel(MOPS) USD/BBL 103.6 129.8 -20.2% Fuel Consumption 10K BBL 1,127.2 1,004.2 12.3% Fuel Cost TWD 100 million 389.4 395.3 -1.5% Hedging gain TWD 100 million (0.2) (1.1) Total fuel cost TWD 100 million 389.2 394.2 -1.2% CHINA AIRLINES Based on individual financial report 9#10Crude Oil and Jet Fuel Price Trends USD/BBL 140 124 120 116 100 80 60 86 88 -Brent -Jet Fuel 85 73 128 94 101 1-Jan-23 1-Feb-23 1-Mar-23 1-Apr-23 1-May-23 1-Jun-23 1-Jul-23 1-Aug-23 1-Sep-23 1-Oct-23 1-Nov-23 CHINA AIRLINES 81 10#11Financial Risk Management ✈ CAL's hedging of fuel, exchange rates and interests rates etc., are based on the decisions made by the Risk Committee of Board of Directors. ✈ Exchange rates Natural hedge is applied in order to reduce exposure to currency fluctuation risks. ✈ Interest rates: Issue fixed-rate corporate bonds and trade derivative products such as IRS to reduce interest rate risks. CHINA AIRLINES 11#12CHINA AIRLINES Passenger Market, Performance & Strategies EAM-#132023 2019 2023 Q1-Q3 Passenger Operational Results 6666666666 Period (Q1-Q3) Passenger revenue Passenger Revenue Sources by Flight Region +/- (%) (NT $billion) 742.2 711.2 +4.4% Oceania 7% Revenue passenger 691 1,176 -41.2% China & Hong Kong 11% Trans- Pacific (10 K) 27% Available Seat Kilometer 316 393 -19.5% Europe 14% (ASK)(billion) Average load factor 78.5 80.7 -2.2 ppt Southeast Asia 17% Northeast Asia 24% (%) Passenger yield (TWD/RPK) 2.99 2.25 +32.9% CHINA AIRLINES Based on individual financial report 13#14Global Passenger Market Overview • The global international passenger market is experiencing stable growth, with high passenger load factors. IATA predicts that the market will surpass pre-pandemic levels in 2024. ASK/RPK YOY% (vs in 2019) 20% 0% -20% -40% -60% -80% -100% Global Int. Passenger Market Sep 114% 105% 93% Global Int. Passenger Market recovery forecast RP (million) PLF% 2000 100% 100% 80% 1500 60% 67% 40% 1000 20% 28% 26% 0% 500 2019 2020 2021 -RPK - AKS PLF CHINA AIRLINES Source: IATA 2022 2023 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 14#15APAC/Taiwan will Reach 2019 levels by 2025-2026 All Regions International Passenger Market recovery forecast Taiwan International Passenger Market recovery forecast RP (million) 1200 Africa APAC Europe Middle East North America 1000 120% 105% 94% 100% 96% 100% 92% 100% 100% 800 80% 111% 80% 80% 60% 65% 96% 600 60% 76% 400 40% 40% 52% 103% 94% 200 112% 20% 15% 98% Up Baseline 2% 10% 90% 101% 0 0% 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 CHINA AIRLINES Source IATA, CAA 15#160 Passenger Market Outlook ---Taoyuan Airport Passenger Demand Continues to Soar . million Passenger volume reaches 6.714 Million, exceeding expectations by 3.3% during the summer vacation. TIAC positively predicts total passenger volume till November will surpass 30 million, the annual passenger. volume will over 70% of 2019 level Taoyuan Airport Passenger Vol. 2019-2023/9 Taoyuan Airport Daily Average Passenger Vol. 5 4 3.67 m 2023 Q1-Q3 3 +1117.2% v.s 22 10 3.05 m 2 +3562.4% v.s 21 -31.7% v.s 19 1 Jan Jul Oct 2019 2020 CHINA AIRLINES Oct Jan Apr Jul Oct 2021 2022 2023 Source: Taoyuan International Airport 5 10k 2019-2023/9 15 13.7 13.9 13.5 13.0 13.1 13.4 13.6 13.9 13.3 13.2 13.2 12.2 → (2019) 10.4 10.7 10.9 10.2 9.2 8.9 (2023) 7.9 .2 6.7 2022.10 Border reopen (2022) 2.2 (2021) (2020) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 16#17Capacity (ASK) Reached 80% of pre-COVID19 Long-Haul ASK 82%~105% S.E. Asia ASK: 83% (PAX revenue: 93%) (PAX revenue: 115%-168%) Up to 80% at the end of year 2023 China & Hong Kong Japan Korea ASK: 59% ASK: 37%-40% (PAX revenue: 82% ) (PAX revenue: 42%-60%) CHINA AIRLINES 17#18Passenger Operation Strategy ☑Steady Development ✈ Take advantage of Taiwan's geographic position as a transit hub, and increase frequencies to North America as well as short-haul network. ✈ Develop bilateral tourism by integrating local resources ✈ Strengthen cooperation between partner airlines ✈ Develop diversified and global business customers ✈ Cultivate new generation customers ☑Continuous Innovation ✈ Provide a unique journey to passengers with enhanced digitalized customer service ✈ Upgrade member system ✈ Enhance official website and app function ✈ Digitalize Corporate Card Service (CFS) ✈ Enhance product value by cross- industry collaboration. CHINA AIRLINES 18#19CHINA AIRLINES Cargo Market, Performance & Strategies EAM-#202023 Q1-Q3 Cargo operational results Period (Q1-Q3) Cargo revenue distribution by region 2023 vs 2022 vs 2019 Cargo revenue 422.0 -54.4% 33.6% Oceanic, 3% Hongkong, 4% (NT $billion) Noth East Asia, 5% Carried tonnes (10 K) 54.6 -23.6% -5.2% China, 6%. Available Freight 6.1 -3.0% 3.3% Ton Kilometer (FATK)(billion) South East Asia, 12% Average North America, 55% load factor 67.1 -10.8 ppt 0.8 ppt (%) Cargo yield (TWD/FRTK) Europe, 15% 10.39 -45.4% 27.8% CHINA AIRLINES Based on individual financial report SOURCE:本公司整理 20 20#21Global Cargo Market Overview . The increasing of belly cargo capacity drives FATK's growth which has surpassed 2019 level. Cargo demand has been steadily growing since May. In August, the monthly international CTK recorded its first YoY growth in 19 months. (vs in 2019) Global Int. Market - FATK/FRTK/CLF ASK/RPK YOY% 15% 0% -15% -30% -45% Jan Mar May Jul Sep 2019 ΛΟΝ Jan Mar May Jul Sep Nov Jan Mar 2020 -FRTK CHINA AIRLINES Global Monthly Int. CTK ( 2019 2022 2023 ) 2019 2022 2023 First YoY growth in 19 months CTK (billion) 25 100% m 80% 20 20 60% 15 40% 20% 10 0% May Jul Sep ΛΟΝ Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 5 2021 2022 FATK CLF Source: IATA 2023 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 21#222023 China Airlines Cargo Performance and Market Share ✈ For Taiwan import/export/transfer cargo in 2023Q1-Q3, China Airlines carried nearly 432 thousand tons with market share of 40.5%, ranking NO. 1 among all airlines although the belly capacities were largely increasing after pandemic released. ✈ In terms of Taiwan export volume, China Airlines carried 112 thousand tons in 2023Q1-Q3 with market share of 34.7%, which was dropped by 0.7ppt as compared to 2022 same period, also in a leading position. Taiwan Cargo Volume and CI Market Share (Q1-Q3) Taiwan Export Cargo Volume and CI Market Share (Q1-Q3) 15.0 40.0% 56.4 60.0 45.0% 15.0 43.2 11.2 10.9 38.5 35.0% O 40.0 10.0 35.4% 42.0% 34.7% 40.0% 40.5% 30.0% 5.0 30.4% 20.0 38.2% 0.0 Y19 CGO Vol(10K ton) CHINA AIRLINES Y22 Y23 --CI Market Share 0.0 35.0% Y19 CGO Vol.(10K ton) Y22 Y23 --CI Market Share 25.0% Source: Taiwan Air Cargo Terminal Limited, Evergreen Air Cargo Services Corp & Farglory 22#23Cargo Market Outlook -Taoyuan Airport Cargo Demand Stabilizing Q1-Q3 cargo volume experienced a 19.31% decrease compared to 2022, but nearly reached the 2019 level. The proportion of Taoyuan Airport's transshipment cargo continues to rise year by year. The destocking phase nears its end, expecting the demands will be gradually stable in upcoming 2023 Q4 and 2024. Taoyuan Airport Monthly Cargo Vol. 2019 2023/9 Taoyuan Airport Import/Export/Transshipment vol. 2018-2023 (Q1-Q3) 10K ton 26 Mail Transshipment Export Import Total 24 22 2019 Sep, 18.5 20 18 16 my 2023 Q1-Q3 -19.31% V.S 22 207.83 10K ton 194.65 200 171.81 2023 Sep, 18.2 165.82 158.18 157.06 100.7 160 (48.5%) 120 81.5 (47.4%) 71.7 81.7 95.8 (49.2%) 79.7 (45.3%) (49.3%) (50.8%) 14 -0.71% V.S 19 80 55.5 48.9 12 43.1 39.7 40.9 37.0 10 40 1 4 7 10 1 4 7 10 1 4 7 10 1 4 7 10 1 4 7 46.0 45.5 41.8 50.2 48.8 39.4 0 2019 2020 2021 2022 2023 2018 2019 2020 2021 2022 2023 CHINA AIRLINES Source: Taoyuan International Airport 23#24Cargo operation strategy ☑Optimize Network and Strengthen Revenue Management ✈ Introduce 777F new freighter ✈ strive for high-yield sources of goods, e.g., semiconductor, cool chain products, etc. ✈ Focus on industrial supply chain reconstruction and optimize cargo network ✈ Strive for medium/ long-term customized services/chartered flights ✈ Cooperate with major integrators and expand Cl network CHINA AIRLINES 24#25CHINA AIRLINES Fleet Development EAM-#26Operating Fleet Year End Aircraft Type SEP 2023 Diff. 2023 777-300ER 10 10 0 Recent Plan : Passenger Regional Routes : In response to delayed A321 deliveries, extending Lease agreement A350-900 14 14 0 CHINA ARUNES A330-300 19 19 0 CHINA AIRLINES 737-800 12 10 -2 737-800 & A330-300 Extend Lease Long Haul: A321 neo Receiving x 15 in 2025-2028 For Developing New Routes and Enhancing the existing one A321neo 10 10 Passenger 65 63 02 A350-900 787-9 & 10 -2 Receiving in 2024 Receiving X 24 in 2025-2028 Total Freighter 744F 14 13 -1 SECARGO Replacement : 777F 7 7 0 Phasing Out 744F, Introducing Next-Generation 777F for Performance Enhancement CARGO Freighter 21 20 -1 CARGO Total 747F 777F Total Fleet 86 83 -3 Remaining x 8 In the End of 2024 The Fleet will be 10 in 2024 CHINA AIRLINES 26#27CHINA AIRLINES Sustainability Actions and Achievements EAM-#28Carbon Reduction Target/Strategy ✈ In response to the global 2050 net zero emissions target, CAL is the first airline in Taiwan to announce that its operational activities will reach net zero emissions by 2050, and has developed short, medium, and long-term carbon reduction targets for flight and ground operations as well as the usage targets of SAF(Sustainable Aviation Fuel) and ground renewable energy installation capacity targets. Flight Operation Reduction Target O Carbon Emission Growth with CORSIA from 2020 1.5% Fuel Efficiency increase every year by 2030 Net Zero Carbon Emissions by 2050 Ground Operation Reduction Target 44% Carbon reduction in 2025 compared with 2009 50% carbon reduction in 2030 compared with 2009 10% RE installations by 2030 (**) Net Zero Carbon Emissions by 2050 TCFD Operating System Upgrade and Emergency Response System Increase Fuel Efficienty Develop New Technology CAL's Net Zero Carbon Emission Targets and Key Strategies Target and Strategies to Achieve Net Zero Emissions by 2050 Participate in International Carbon Management Mechanisms Environmental Committee Use of SAF Target 2% by 2025 5% by 2030 40% by 2040 65% by 2050 CHINA AIRLINES Promote Sustainable Aviation Fuels Board of Directors Sustainability Committee 2050 NeZer CAL CSR Climate Change **This is not the proportion of electricity use. This is an additional target beside the Taiwan national power grid target. China Airlines expects to use 40% renewable energy by 2030 if Taiwan National Grid target is included. 28#29Sustainable Performance & Achievement Member of Dow Jones Sustainability Indices Powered by the S&P Global CSA 17 FTSE4Good TIP Taiwan ESG Index TCSA GCSA TAIWAN SDGs S China Airlines, Lid. Arnes Top 1% S&P Global ESG Score 2022 7 consecutive years selected for DJSI Emerging Market Index 83/100 2016-2022 Ranked 1st in Global Aviation Industry 8 consecutive years selected for FTSE4Good Index Series 2016-2023 10c consecutive years 2014-2023 Peston and Score are industry specife and relect excusion S&P Global FTSE4Good TIP Taiwan ESG Index Taiwan Corporate Sustainability Award First year Top 10 Taiwan Sustainable Model Corporate 2 Consecutive years Top Sustainability Report award 5 consecutive years Global Corporate Sustainability Awards 1 2019-2023 first year 2022 National Sustainable Development Award TIP Tavan edes Plas TIP Tainan ledes es Sustainable 1 TIP Talwan Indes Plan 6 consecutive 2017-2023 5cor 7 years consecutive years Sustainability Yearbook TOP 1% Highest Honor FTSE4Good TIP Taiwan ESG Index 2018-2019 2021-2023 consecutive Taiwan High Compensation 100 Index 2017-2023 years 7 consecutive years Taiwan Employment Creation 99 Index 1 2017-2023 first year 2022 Annual Enterprises Protection Award CHINA AIRLINES The 2023 DJSI will be Announced in December. 29#30Thank you CHINA AIRLINES EAM-