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CEO Message

I would like to express my deepest gratitude to our customers, shareholders and stakeholdersfor your unwavering support for SK chemicals in 2018.

In 2018, SK chemicals improved managementperformance over the previous year thanks to increased sales in our core businesses. Notably, SK life science’s pharmacy (Pharma), vaccine (SK bioscience) and plasma-derived biotherapy(SK plasma) businesses are all in the black.Improved operational efficiency of thepharmaceutical businessand export of vaccine technology greatly contributed to such achievements. However, the performance of Green Chemicalsbusiness was disappointing due to a rapid increase in raw material costs, new difficulties facing the business, and fierce competition abroad.

For the past few years, many changes were made to SK chemicals. Our company was dividedinto SK discovery, the holding company, and SK chemicals, which handles businesses. SK bioscience and SK plasma were separated from SK chemicals and the acquisition ofSK Petrochemicaltook place. The Andong Plantbegan manufacturing vaccines and plasma-derived products and facility supplementation ofthe aged Ulsan Plant is almost complete. Together with such investments and outstanding management, SK chemicals will be able to continue its growth. Because of these positive results, we have established challenging management objectives for 2019.

These are not easy tasks, but we are committed to achieving them by maximizing revenuesof our major businesses via management optimization and by enhancing the operation of and increasing sales in businesses that have received new investments. Moreover, we will realize the full potential of low-growth businesses; and for businesses facing limitations, we will switch to a more appropriate approach to running them.

SK chemicals elected to pursue high-performance HRa few years ago and began implementing new systems last year. Based on these changed processes and procedures, we will pursue the growth of both individuals and the company in a professional environment.

Dear stakeholders,

2019 will be the year that we see and prove the results of our efforts and investments. It will also be the year where changes in systems are reflected inhow we do business, which will ultimately strengthen our high-performance organization.

As we embark on this new journey, I cordially ask you to join us as we fulfill our objectives. Managementand I will be at the forefront in leading the change.

I sincerely wish you and your family health and happiness in this auspicious year of the Golden Pig.Thank you

SK chemicals CEO Kim Cheol & Park Man Hoon