Kumho Petrochemical : 46th Annual General Meeting of Shareholders Reference Material

KUMHO PETROCHMICAL

46th Annual General Meeting of Shareholders Reference Material

Table of content
No.	Topic	No.
	Message from the Chairperson	02
1	Notice of Convocation of the 46th Annual General Meeting of Shareholders	04
2	Agendas	05
3	ESG Improvement Performance	09
4	Composition and Operation of the Board of Directors	13
5	Appendix	23
	Financial Statements (FY2022)

1

Dear Shareholders of Kumho Petrochemical,

We would like to express our sincere appreciation for the support you have shown during the tumultuous year of 2022. The year 2022 presented us with significant external challenges, including declining demand in the consumer goods market due to interest rate hikes across major economies, the outbreak of the War in Ukraine, and China's "Zero COVID" policy.

Despite these challenges, our commitment to expanding investments in our core businesses has remained steadfast. Through strategic initiatives focused on increasing production capacity and enhancing our global competitiveness, we have made significant progress in achieving our objectives. In addition, we stayed focused on progressing towards our environmental, social, and governance (ESG) targets, demonstrating our dedication to sustainable practices and responsible business operations. We will continue to prioritize investments in areas that drive long-term value creation for our stakeholders while upholding our commitment to ESG principles.

As we move forward, we remain confident in the future of our Company and look forward to sharing our success with you in the years to come.

Strong business performance in a challenging environment

While the COVID-19 pandemic has been a tragic global event over the past three years, it has accelerated consumer demands in medical NB latex and as the world's largest manufacturer of NB latex, we have experienced substantial sales growth during this period. However, the year 2022 posed significant challenges to our Company as the global economic slowdown and pandemic-related inflation made it difficult to maintain such growth momentum we experienced in the past two years.

In 2022, we achieved sales of KRW 7.97 trillion and an operating profit of KRW 1.14 trillion. Although these figures represent a 5.7% and 52.3% reduction, respectively, compared to our remarkable achievements in the previous year, our performance demonstrate our focus in minimizing external risks and maintaining stable performance in the face of significantly volatile market conditions.

We also continued our active investment in projects for future sustainable growth. In 2022, the Company successfully expanded the production of S-SBR synthetic rubber by 60,000 tons, specially designed for electric vehicle tires and high-performance EPDM product by 10,000 tons. Currently, we are focused on increasing epoxy products by 60,000 tons in 2023 and plan to increase NB latex by 230,000 tons by 2024. These investments reflect Kumho Petrochemical's strategic vision to remain at the forefront of innovation, meet the changing needs of the market, and ensure long-term sustainable growth.

As we move forward, we will remain vigilant in our efforts to identify and pursue growth opportunities that are aligned with our long-term objectives, while maintaining our commitment to responsible and sustainable business practices.

Outstanding ESG achievements

Based on the medium to long-term strategies in place, we are responding to the rapidly changing global environment proactively and collaboratively. We aim to achieve excellence in ESG performance and reporting, in which we apply the recommendations of the TCFD. In December 2021, we joined the UNGC and declared our support for TCFD in July of the same year, demonstrating our dedication to fulfilling our corporate social responsibility.

In December of last year, we made a strategic decision to separate the roles of CEO and Chair of the Board, and subsequently appointed an independent director as the new Board Chair. As the Chair of the Board, I represent the Board in stating that we take our responsibility to prioritize shareholder value very seriously. We will implement a Board-centered management approach and encourage independent opinions in our boardroom to promote discussions that are open, impactful and fulsome.

While we are proud to have implemented all the board operations related improvements, we promised in 2021 that we will not be complacent and continue to strive to exceed our shareholders' expectations.

Starting this year, we aim to enhance communication with our shareholders by regularly updating them on the

2

activities and plans of the Board throughout the year. When needed, we will also provide opportunities for direct dialogues with our shareholders. We believe that transparent communication with our shareholders is essential to maintaining their trust and support, and we look forward to engaging with them in meaningful ways moving forward.

2023 Annual General Meeting

Kumho Petrochemical invites our shareholders to the Annual General Meeting scheduled on Friday, March 24th. The meeting will cover two agenda items:

1. Approval of Financial Statements and Allocation of Income of the 46th Fiscal Year (January 1, 2022, to Decemb er 31, 2022) which includes the Appropriation Statement of Retained Earnings; and
2. Approval of Director Remuneration Limit .

As we announced last year, we are maintaining a consistent dividend payout ratio of 20-25% for the next two- three years. This year, we will pay a dividend of KRW 5,400 per share this year, which represents a payout ratio of 25.5% of earnings. We also plan to repurchase and retire KRW 100 billion worth of our own shares throughout the year, further demonstrating our dedication to enhancing shareholder value.

We highly value the voting rights of our shareholders. We encourage you to participate actively in the upcoming General Meeting of shareholders and exercise your right to vote. To help you make informed decisions, we have provided details of our yearly performance, ESG progress, and agenda items in the Convocation Notice of the Meeting.

Once again, we deeply appreciate your support and look forward to your continuing support in Kumho Petrochemical.

Sincerely,

Do-Soung, Choi

Chair of the Board

Kumho Petrochemical

3

1. Notice of Convocation of the 46th Annual General Meeting of Shareholers.

1. Date: March 24, 2023 (Friday) 9:00 a.m.
2. Location: 4F Auditorium, East Building, Signature Towers, 100 Cheonggyecheon-ro,Jung-gu, Seoul, Republic of Korea
3. Purpose of Meeting
4. 1. Matters to report:
      Audit reports, business reports, reports on transaction history with the largest shareholders, etc., reports on the operation status of the internal accounting control system
   2. Resolutions (Agenda to be discussed):

Agenda No. 1: Approval of Financial Statements and Allocation of Income of the 46th Fiscal Year (January 1, 2022 to December 31, 2022) which includes the Appropriation Statement of Retained Earnings

Agenda No. 2: Approval of Director Remuneration Limit

4. Matters concerning the exercise of voting rights

Shareholders may attend the general meeting to exercise their voting rights directly, or delegate their voting rights to an agent to enable voting in their absence.

• When exercising directly: ID card (resident registration card, driver's license, or passport)
• When exercising through an agent: Power of attorney, agent's ID card, copy of mandator's seal certificate or ID card

• Matters to be stated in the power of attorney

• Name, address, and resident registration number of the mandator (in the case of a corporation, the corporate registration number, the same applies below)
  ② Details of the agent's name, address, resident registration number, and details of delegation of voting rights
  ③ Certified seal or signature of the mandator

(Our company's power of attorney form will be posted on our internet homepage below from March 11, 2023) https://www.kkpc.com/kor/invest/disclosure/announcementList/

4