#1China Airlines 2023 1st Investor Conference Jun. 13.'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 Operating Performance → Operating Challenges ✈ Passenger Market, Performance & Strategies ✈ Cargo Market, Performance & Strategies ✈ Fleet Development ✈ Sustainability Actions and Achievements CHINA AIRLINES 3#4CHINA AIRLINES 2023Q1 Operating Performance EAM-#52023 Q1 Financial Performance (NTD 100 Million) 2023.Q1 2022.Q1 Differences YOY Operating revenue Passenger revenue 245.49 21.85 223.64 +1023.52% Cargo revenue 157.04 327.79 -170.75 -52.09% Other operating revenue 24.39 22.69 1.70 +7.49% Net Operating Income 18.26 36.26 -18.00 -49.64% Net Income After Tax 13.97 28.11 -14.14 -50.30% Net Income Attributable to 13.06 30.72 -17.66 -57.49% Owners of the company Earnings Per Share (TWD) 0.22 0.52 -0.30 CHINA AIRLINES Based on consolidated financial report 5#6Operating Revenue by Source ✈ Passenger revenue have exceeded cargo revenue becoming the largest revenue share representing 55% by 2023Q1. 140 120 100 80 60 40 20 Other Rev Monthly revenue Pax rev ■Cgo rev 0 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 Currency: NTD 100 million 2022 2023 CHINA AIRLINES Based on individual financial report 6#7Highest Quarterly Operating Revenue since 2022 ✈ The operating revenue in 2023Q1 was the highest since 2022. Mostly contributed by the 1,417% annual growth rate of passenger revenue, the passenger revenue from all regions increased significantly. NTD100 million 400 Quarterly revenue 2023Q1 Passenger revenue distribution by region (YoY) 380 360 2023 Q1, 340 2022 Q1, 2022 Q4, 379.55 353.47 320 2022 Q2, 346.31 2022 Q3, 351.69 359.24 300 CHINA AIRLINES North America, +1,458% Europe, +1,837% North East Asia, +18,396% China, +235% South East Asia, +1,243% Oceanic, +1,370% Based on individual financial report 7#8Cost Breakdown and Comparison 2023Q1 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Fuel 36% 2022Q1 34% CHINA AIRLINES 17% 14% 14% 10% 3% Rental Depr. Airport & OTH Labor Maintenance & Amortization ground Sales & handling passenger service 19% 18% 14% 9% 4% Based on individual financial report 8#9Fuel Cost Analysis Unit 2023Q1 2022Q1 YOY Jet fuel(MOPS) USD/BBL 110.61 94.39 17.2% Fuel Consumption 10K BBL 354.72 352.35 0.7% TWD Fuel Cost 130.29 105.14 23.9% 100 million TWD Hedging gain 0.13 100 million (0.43) TWD Total fuel cost 130.42 104.71 24.5% 100 million CHINA AIRLINES Based on individual financial report 9#10Crude Oil and Jet Fuel Price Trends USD/BBL 180 170 160 150 138.05 140 130 120 110 110.23 174.01 122.27 129.75 W -120.54 Миран 117.24 100 86.5 90 94.67 80 80 -Brent -Jet Fuel 70 22/01/01 22/02/01 22/03/01 22/04/01 22/05/01 22/06/01 22/07/01 22/08/01 22/09/01 22/10/01 22/11/01 CHINA AIRLINES 98.21 91.4 76.1 72.97 22/12/01 23/01/01 23/02/01 23/03/01 23/04/01 23/05/01 87.9 76.84 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 Operating Challenges EAM-#13Operating Challenges & Variables COVID-19 Pandemic Passenger traffic recovering Cargo demand softening Supply chain issues Delay of aircraft delivery Staff shortage of aviation industry CHINA AIRLINES 181 Economic Factors Global economic variables SEMI/electronics recovers quarter by quarter Manufacturing destocking comes to an end Geopolitics Russia-Ukraine crisis US-China trade war Cross-Strait Relations 13#14CHINA AIRLINES Passenger Market, Performance & Strategies EAM-#15International Passenger Market under Recovery Global International Passenger Market recovery forecast Global International Passenger Market ASK/RPK YOY% (vs the same month in 2019) RP(million) PLF% 2000 20% 100% PLF 0% 1500 80% -20% ASK 60% 1000 -40% RPK 40% -60% 500 20% -80% -100% 0% 0+ 2019 2020 2021 2022 2023 CHINA AIRLINES 100% 28% 26% 108% 96% 81% 66% 2017 2018 2019 2020 2021 2022 2023 2024 2025 Source IATA Oxford Economics 15#16APAC/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 800 600 400 200 120% 105% 94% 100% 96% 100% 92% 100% 100% 80% 111% 96% 80% 80% 60% 65% 60% 76% 40% 52% 40% 103% 94% 112% 20% 15% 98% 2% Up Baseline 90% 101% 10% 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 Passenger forecast CAA 16#17Taiwan's Travel Demand Recovers Rapidly Taoyuan International Airport Passenger Volume 2019 Apr. 2023 Taoyuan International Airport Passenger Volume 2022 Apr. 2023 (10K) 416 500 (Apr 19) 400 300 200 100 -100 0 Jan Mar May Jul Sep Nov Jan 2019 2020 12/10 Arriving passengers limit canceled 300 250 274 10/13 245 274 2023 Q1 6/15 (Apr 23) 200 Quarantine period 0+7 Arriving passengers 150K/week 207 203 +2164.2% V.S 22 150 +2713.7% V.S 21 Open for transit passenger Quarantine period 3+4 Arriving passengers 25K/week 158 104 -45.7% V.S 19 100 67 48 48 36 50 20 9 10 10 11 13 Sep May Μαν JUI Sep Nov Jan Mar 0 2021 2022 2023 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr 2022 2023 2019 2020 2021 2022 2023E Passenger Volume (million) 48.69 7.44 0.91 5.34 28.00 萬 Revovery level (vs 2019 ) 100% 15.3% 1.9% 11% 58% CHINA AIRLINES Source: Taoyaun Airport official site 17#182023 Q1 Passenger Operational Results 6666666666 Passenger revenue distribution by region (by Sector) 2022Q4 2022Q1 2023Q1 QoQ YOY 35% Passenger revenue 30% 21.10 +84.7% +1,417.0% (NT $billion) 25% Revenue 20% passenger ('000) 1,887 +106.3% +2,784.1% 15% 10% Available Seat Kilometer 9.49 +32.1% +500.8% 5% (ASK)(billion) 0% Average load factor 74.0 +19.2ppt +57.9ppt (%) Passenger yield (NT$) 3.00 +3.5% -45.3% 2022Q1 North East Asia ■2023Q1 26% ■202204 16% 2% South North America East Europe Oceanic China Asia Hong Kong 24% 20% 12% 10% 5% 3% 30% 22% 15% 12% 4% 1% 24% 23% 9% 11% 24% 2% CHINA AIRLINES Based on individual financial report 18 SOURCE:本公司整理#19Capacity Reached 70% of pre-COVID19 Long-Haul Flights: 90-95% (PAX revenue: 125%~153%) S.E. Asia Flights: 75% (PAX revenue: 90%) China & Hong Kong Up to 80% at the end of year 2023 Japan • Korea Increased gradually according to governments' policy Resume 13 routes / 1,000 flights of Original 17 routes / 1,600 flights (TSA-GMP, TSA-HND fully restored) CHINA AIRLINES 2023Q1 vs.. 2019Q1 19#202023Q2 Capacity Growing (verses 2023Q1) Y2023 ASKS (million) Trips Route Q1 Q2 +/- Q1 Q2 +/- N. America 800 926 16% 2,898 3,394 17% S.E. Asia 3,467 3,870 12% 2,263 2,421 7% Europe 491 576 17% 1,497 1,752 17% N.E. Asia 2,896 3,512 21% 1,452 1,738 20% Oceania 578 526 -9% 1,082 955 -12% China 692 1,458 111% 163 339 108% Hong Kong 703 1,174 67% 134 227 70% TOTAL 9,629 12,042 25% 9,492 10,825 14% *Capacity of 2023Q2 in Oceania decreased due to low season. CHINA AIRLINES 20#21New Routes TPE-CNX DAD CEB PRG PRG TPE-PRG v.v. From 2023-07-18 2 FPW TPE-CNX v.V. From 2023-01-20 4 FPW TPE-DAD V.V. From 2023-01-04 Daily (from 2023-06-22) TPE-CEB v.v. CNX DAD From 2022-12-01 5 FPW CHINA AIRLINES FPW: flight per week TPE CEB 21#22Γ , KHH Operations (groutes 1,190 flights restored) 曼谷 (BKK) CHINA AIRLINES 首爾(ICN) 大阪 (NRT) (KIX) 廈門 深圳 (XMN) 上海(PVG) 1,400 1,200 1,000 800 10 10 8 8 1,190 784 6 (SZX) 600 (HKG (KHH) 高雄 3 3 4 +52% 香港 400 2 2 158 2 200 78 38 72 0 0 Q1 Q2 Q3 Q4 Q1 Q2 馬尼拉(MNL) 2022 2022 2022 2022 2023 2023 22#23A321 neo Cabin: Modernized & Natural Luxury Business Cabin Personal 4K HD Screens "Fu Dia" to bless passengers a pleasant journey Multi-Layer Pockets for user's convenience New Chairs with more Space & Comfort Persimmon wood & unique decorations CHINA AIRLINES SOURCE:本公司整理 23#24Enriched Cabin Services HIT MOVIES Fantasy Sky 100+ Movie+TV+Music Clean & Green Plant-based Cuisine by "Yang Ming Spring" Skyward 3-Stars Private Cuisine for all cabins by "Le Palais", the only 3-star Michelin restaurant in Taiwan Signature Desserts made with seasonal ingredients produced in Taiwan by "Le Ruban Pâtisserie" Dynasty Sky Reading 100+ book, magazine, & newspapers, in various languages CHINA AIRLINES Exclusive Bedding for Premium Business Class SkyLounge with "Taiwan Wonderful Food" "Natural Style" Japanese Cuisine for Premium Business/Business Class by famous restaurant "TOUTOUAN" in Tokyo 24#25Passenger Operation Strategy ☑Steady Development ✈ Take advantage of Taiwan's geographic position as a transit hub. ✈ 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 25#26CHINA AIRLINES Cargo Market, Performance & Strategies EAM-#272023 Q1 Cargo operational results 100 100 100 100 100 100 100 100 100 100 Cargo revenue distribution by region 2023Q1 2022Q1 YoY 2019Q1 YoY Oceanic 4% Hong Kong 4% Cargo revenue (NT $billion) 15.61 -52.2% +55.1% North East Asia 6% Carried tonnes 184 -26.0% +1.7% ('000) Available China, 7% Freight 1.95 -12.8% +6.6% Ton Kilometer (AFTK)(billion) South East Asia, 13% Average load factor 68.3 -9.9ppt +2.7ppt (%) Europe, 16% Cargo yield (NT$) 11.76 -37.3% +39.7% CHINA AIRLINES North America, 50% Based on individual financial report 27 SOURCE:本公司整理#282022 China Airlines Cargo Performance and Market Share ✈ For Taiwan import/export/transfer cargo in 2022, China Airlines carried nearly 740 thousand tons with market share of 42%, ranking NO. 1 among all airlines. ✈ In terms of Taiwan export volume, China Airlines carried 196 thousand tons in 2022, with market share of 35.7%, which was also in a leading position, same in the first four months of 2023 further elevated to 36.2%. TWN Export Market Share _ Cl (excluded Express) share 40% 35% 30% 25% 2021 : 34% 2022: 35.7% 2022/1-4 35.0% 2023/1-4 36.2% 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 CHINA AIRLINES 2021 Source Taiwan CAA 2022 2023 28#292023 Global Market Outlook ✈ 2023 H1 Forecast the global demand decrease while supply increase. ✈ 2023 H2 With the continuous reduction and adjustment of inventory in the industrial supply chain, and the forecasts of related industries, the demand for air cargo is expected to stabilize. 2022 01 Forecast 2010-19 Avg of GDP Growth Rate (YOY) Load Factor Global GDP Forecast International Air Cargo Market 8.0 (%) 2023 03 Forecast 2022 12 Forecast 20% 80% 10% 60% 0% -10% 40% -20% 20% -30% -40% 0% 2019 2020 2021 2022 2023 -FRTK FATK Load Factor CHINA AIRLINES World GDP Growth (%) 6.0 40 4.0 2.0 00 0.0 -2.0 -4.0 2018 2019 2020 2021 2022 2023 2024 2025 Source: IATA Boeing (S&P Global dated March 2023) 29#30Cargo Operation Strategy ☑ Optimize Network and Strengthen Revenue Management ✈ Introduce 777F new freighter ✈ Focus on industrial supply chain reconstruction and optimize cargo network ✈ Strive for medium/ long-term customized services/chartered flights ✈ Strive for high-yield sources of goods, e.g., semiconductor, cool chain products, etc. ✈ Cooperate with integrators and other interlines to expand Cl network CHINA AIRLINES 30#31Fleet Development CHINA AIRLINES EAM-#32Operating Fleet Year end Aircraft Type March 2023 Diff. 2023 777-300ER 10 10 A350-900 14 14 A330-300 20 19 -1 CHINA AIRLINES 737-800 12 10 -2 A321neo 10 10 Passenger total 66 63 -3 744F 17 13 -4 SCARGO 777F 5 7 +2 CARGO Freighter total 22 20 心志 -2 Total Fleet 88 83 -5 CHINA AIRLINES Recent Plan Exercise of option to purchase Total size of 787 fleet: 24 Support regional routes & expand long-haul routes Improve long-haul operational efficiency Plan to sell 5 747-400F this year. Replace the old with the new to optimize operational efficiency Extend lease on 737-800 Maintain stability of regional flight schedules Considering leasing more long-haul aircraft Supplement long-haul capacity Meet the demand during the recovery period 32#33CHINA AIRLINES Sustainability Actions and Achievements EAM-#34Carbon Emission Policy/Carbon Reduction Strategy ✈ On 2021/10/26 CAL has pledged to achieve net zero emissions on both flight and ground operations by 2050, in order to achieve the global net zero carbon emissions target by 2050. Short, medium, and long-term goals have been established for carbon reduction and the use of SAF(Sustainable Aviation Fuel). 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 2050 NeZerQ Use of SAF Target 2% by 2025 5% by 2030 CHINA AIRLINES 34#35Sustainable Performance & Achievement Member of Dow Jones Sustainability Indices Powered by the S&P Global CSA consecutive years 2016-2022 selected for DJSI Emerging Markets Index Ranked 1st in Global Aviation Industry 7 FTSE4Good consecutive years 2016-2022 selected for FTSE4Good Index Series 6 consecutive years 2017-2022 4 consecutive years 2018-2019 2021-2022 6 consecutive years 2017-2022 Sustainability Yearbook FTSE4Good TIP Taiwan ESG Index Taiwan High Compensation 100 Index 9 TCSA consecutive years 2014-2022 Taiwan Corporate Sustainability Award Top Sustainability Report award 6 consecutive years 2017-2022 Taiwan Employment Creation 99 Index GCSA 4 consecutive years 2019-2022 Global Corporate Sustainability Awards National Sustainable Development Award 2022 CHINA AIRLINES 35#36Thank you CHINA AIRLINES EAM-