English Translation of Consolidated Financial Statements and a Report Originally Issued in Chinese

Ticker: 3715

DYNAMIC HOLDING CO., LTD.

AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

WITH AUDIT REPORT OF INDEPENDENT ACCOUNTANTS

AS OF DECEMBER 31, 2025 AND 2024

AND FOR THE YEARS THEN ENDED

Address: 6F., No. 50, Minquan Rd., Luzhu Dist., Taoyuan City 338, Taiwan (R.O.C.)
Telephone: (03)349-3300

The reader is advised that these consolidated financial statements have been prepared originally in Chinese. In the event of a conflict between these financial statements and the original Chinese version or difference in interpretation between the two versions, the Chinese language financial statements shall prevail.

English Translation of Consolidated Financial Statements and a Report Originally Issued in Chinese

Consolidated Financial Statements Index

Item	Page numbering
1. Cover sheet	1
2. Index	2
3. Management representation letter	3
4. Report of independent auditors	4-8
5. Consolidated balance sheets	9-10
6. Consolidated statements of comprehensive income	11
7. Consolidated statements of changes in equity	12
8. Consolidated statements of cash flows	13
9. Footnotes to the consolidated financial statements
(1) History and organization	14
(2) Date and procedures of authorization of financial statements for issue	14
(3) Newly issued or revised standards and interpretations	15-21
(4) Summary of significant accounting policies	21-49
(5) Significant accounting judgments, estimates and assumptions	50-52
(6) Contents of significant accounts	52-92
(7) Related party transactions	92
(8) Assets pledged as collateral	93
(9) Significant contingencies and unrecognized contract commitments	93
(10) Losses due to major disasters	94
(11) Significant subsequent events	94
(12) Others	94-103
(13) Other disclosures
1. Information on significant transactions	103
2. Information on investees	103-104
3. Information on investments in Mainland China	105-108
(14) Segment information	108-110

English Translation of Financial Statements and a Report Originally Issued in Chinese

MANAGEMENT REPRESENTATION LETTER

The entities that are required to be included in the combined financial statements of Dynamic Holding Co., LTD. as of December 31, 2025 and for the year then ended under the Criteria Governing the Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises are the same as those included in the consolidated financial statements prepared in conformity with the International Financial Reporting Standard No. 10, "Consolidated Financial Statements." In addition, the information required to be disclosed in the combined financial statements is included in the consolidated financial statements. Consequently, Dynamic Holding Co., LTD. and Subsidiaries do not prepare a separate set of combined financial statements.

Very truly yours,

DYNAMIC HOLDING CO., LTD.

KEN HUANG

Chairman

March 6th, 2026

EY安永

Building a better working world

安永聯合會計師事務所

33045 桃園市桃園區中正路1088號27樓

27F, No. 1088, Zhongzheng Road, Taoyuan District

Taoyuan City, Taiwan, R.O.C.

Tel: 886 3 427 5008

Fax: 886 3 425 1711

www.ey.com/taiwan

English Translation of a Report Originally Issued in Chinese

AUDIT REPORT OF INDEPENDENT AUDITORS

To: The Board of Directors

Dynamic Holding Co., Ltd.

Opinion

We have audited the accompanying consolidated balance sheets of Dynamic Holding Co., Ltd. (the “Company”) and its subsidiaries as of December 31, 2025 and 2024, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including the summary of significant accounting policies (together “the consolidated financial statements”).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company and its subsidiaries as of December 31, 2025 and 2024, and their consolidated financial performance and cash flows for the years then ended, in conformity with the requirements of the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards, International Accounting Standards, Interpretations developed by the International Financial Reporting Interpretations Committee or the former Standing Interpretations Committee as endorsed by Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Financial Statement Audit and Attestation Engagements of Certified Public Accountants and the Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company and its subsidiaries in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China (the “Norm”), and we have fulfilled our other ethical responsibilities in accordance with the Norm. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

A member firm of Ernst & Young Global Limited

EY安永

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of 2025 consolidated financial statements. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Revenue Recognition

The Company’s consolidated revenue amounted to NT$19,452,961 thousand for the year ended December 31, 2025. The Group has conducted these sale activities in multi-marketplace, including Taiwan, China, Asia and Europe, etc. Furthermore, the timing of fulfilling performance obligation needs to be determined based on varieties of sale terms and conditions enacted in the main sale contracts or sale orders. We therefore conclude that there are significant risks with respect to the topic of revenue recognition.

Our audit procedures therefore include, but not limit to, evaluating the appropriateness of accounting policy for revenue recognition, the effectiveness of relevant internal controls related to revenue recognition, sampling-test of details, including obtaining major sale orders or agreements to check if the terms and conditions are consistent with the fulfillment timing, performing analytical review procedures on monthly sale revenues, and executing sale cut-off tests, etc. In addition, we evaluated the adequacy of disclosures regarding revenue in Note 4 and 6 to the consolidated financial statements.

Provision against inventory

The Company and its subsidiaries’ inventory amounted to NT$4,359,676 thousand, representing 11% of consolidated total assets as of December 31, 2025. The application market of the Group’s main products, PCB, has been developing and changing rapidly and influenced significantly by end-customers’ preference. The management therefore has to closely monitor the status of new products development and market demand for evaluating any significant impairment, including loss from market decline and slow-movement, incurred toward inventory. Also there was significant management judgement involved in determining the sufficiency of inventory loss provision. With respect to the key audit matter – provision against inventory, our audit procedures include, but not limit to, evaluating the appropriateness of inventory provision policy including how to identify the phased-out or slow-moving items, testing the correctness of inventory aging report, analyzing the reasons for slow-moving inventory, performing observation on the Company and its subsidiaries’ inventory physical taking, and looking into the status of inventory utilization. In addition, we evaluated the adequacy of the disclosures regarding inventory in Note 5 and 6 to the consolidated financial statements.

A member firm of Ernst & Young Global Limited

EY安永

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 the requirements of the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards, International Accounting Standards, Interpretations developed by the International Financial Reporting Interpretations Committee or the former Standing Interpretations Committee as endorsed by Financial Supervisory Commission of the Republic of China 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 ability to continue as a going concern of the Company and its subsidiaries, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company and its subsidiaries or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including audit committee, are responsible for overseeing the financial reporting process of the Company and its subsidiaries.

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 the Standards on Auditing of the Republic of China 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.

EY安永

As part of an audit in accordance with the Standards on Auditing of the Republic of China, 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 internal control of the Company and its subsidiaries.
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 ability to continue as a going concern of the Company and its subsidiaries. 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 Company and its subsidiaries to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the accompanying notes, 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 Company and its subsidiaries 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.

EY安永

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of 2025 consolidated financial statements and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Others

We have audited and expressed an unqualified opinion on the parent-company-only financial statements of the Company for the year ended December 31, 2025 and 2024.

/s/Lo, Hsiao Chin

/s/Chang, Chih Ming

Ernst & Young
March 6th, 2026
Taipei, Taiwan,
Republic of China

Notices to Readers

The accompanying consolidated financial statements are intended only to present the consolidated financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China on Taiwan and not those of any other jurisdictions. The standards, procedures and practices to audit such consolidated financial statements are those generally accepted and applied in the Republic of China on Taiwan.

Accordingly, the accompanying consolidated financial statements and report of independent accountants are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice. As the financial statements are the responsibility of the management, Ernst & Young cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

English Translation of Consolidated Financial Statements Originally Issued in Chinese

DYNAMIC HOLDING CO., LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

As of December 31, 2025 and 2024

(Amounts Expressed in Thousands of New Taiwan Dollars)

Assets			As of December 31, 2025		As of December 31, 2024
Code	Accounts	Notes	Amount	%	Amount	%
11xx	Current assets
1100	Cash and cash equivalents	4, 6(1)	$5,526,274	14	$2,849,250	9
1136	Financial assets measured at amortized cost	4, 6(2), 8	44,716	-	-	-
1150	Notes receivable, net	4, 6(3), 8	478,967	1	408,424	1
1170	Accounts receivable, net	4, 6(4)	6,361,050	17	5,252,665	17
1200	Other receivables		167,105	1	171,451	2
1220	Income tax assets	4, 6(24)	285	-	1,747	-
1310	Inventories, net	4, 6(5)	4,359,676	11	3,226,752	10
1410	Prepayments		842,623	2	748,363	2
1470	Other current assets		666	-	28,044	-
	Total current assets		17,781,362	46	12,686,696	41
15xx	Non-current assets
1600	Property, plant and equipment	4, 6(6), 8, 9	18,472,852	48	15,475,105	50
1755	Right-of-use assets	4, 6(20), 8	378,603	1	398,381	1
1780	Intangible assets	4, 6(7), 6(8)	71,353	-	78,857	-
1840	Deferred tax assets	4, 6(24)	221,920	1	107,191	1
1900	Other non-current assets	6(9)	65,220	-	27,709	-
1915	Prepayment for equipment	6(6)	1,653,485	4	2,128,395	7
	Total non-current assets		20,863,433	54	18,215,638	59
	Total Assets		$38,644,795	100	$30,902,334	100

(The accompanying notes are an integral part of the consolidated financial statements.)

English Translation of Consolidated Financial Statements Originally Issued in Chinese

DYNAMIC HOLDING CO., LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (Continued)

As of December 31, 2025 and 2024

(Amounts Expressed in Thousands of New Taiwan Dollars)

Liabilities and Equity			As of December 31, 2025		As of December 31, 2024
Code	Accounts	Notes	Amount	%	Amount	%
21xx	Current liabilities
2100	Short-term loans	6(10), 8	$4,345,081	11	$7,988,526	26
2130	Contract liabilities	4, 6(18)	2,234	-	850	-
2150	Notes payable		189	-	189	-
2170	Accounts payable		4,363,487	12	3,852,344	13
2200	Other payables	6(11)	3,096,533	8	5,092,349	16
2230	Current tax liabilities	4, 6(24)	86,652	-	74,720	-
2280	Lease liabilities	4, 6(20)	2,443	-	2,719	-
2300	Other current liabilities		53,660	-	41,739	-
2322	Current portion of long-term loans	6(12), 8	1,211,029	3	141,343	1
2365	Refund liabilities	4, 6(13)	416,556	1	376,538	1
	Total current liabilities		13,577,864	35	17,571,317	57
25xx	Non-current liabilities
2540	Long-term loans	6(12), 8	10,470,645	27	3,562,179	12
2570	Deferred tax liabilities	4, 6(24)	1,200,993	3	974,456	3
2580	Lease liabilities	4, 6(20)	316	-	2,776	-
2630	Long-term deferred revenue	4, 6(14)	638,263	2	634,997	2
2645	Guarantee deposits		93,184	-	76,272	-
	Total non-current liabilities		12,403,401	32	5,250,680	17
	Total liabilities		25,981,265	67	22,821,997	74
31xx	Equity attributable to shareholders of the parent
3100	Capital	6(16)
3110	Common stock		2,835,746	7	2,776,746	9
3200	Capital surplus	6(16)	5,453,145	14	2,987,714	10
3300	Retained earnings	6(16)
3310	Legal reserve		221,623	1	116,549	-
3320	Special reserve		299,666	1	389,953	1
3350	Accumulated profit or loss		1,827,683	5	1,510,001	5
3400	Other components of equity		167,530	-	106,440	-
36xx	Non-controlling interests	6(16)	1,858,137	5	192,934	1
	Total equity		12,663,530	33	8,080,337	26
	Total liabilities and equity		$38,644,795	100	$30,902,334	100

(The accompanying notes are an integral part of the consolidated financial statements.)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the Years Ended December 31, 2025 and 2024

(Amounts Expressed in Thousands of New Taiwan Dollars, Except Earnings Per Share)

Code	Accounts	Notes	2025		2024
			Amount	%	Amount	%
4000	Operating revenues	4, 6(18)	$19,452,961	100	$17,787,004	100
5000	Operating costs	6(5)	(15,691,276)	(81)	(13,676,707)	(77)
5900	Gross profit		3,761,685	19	4,110,297	23
6000	Operating expenses
6100	Sales and marketing expenses		(465,457)	(2)	(588,050)	(3)
6200	General and administrative expenses		(1,235,227)	(6)	(1,252,031)	(7)
6300	Research and development expenses		(904,754)	(5)	(733,369)	(4)
6450	Expected credit gains (losses)	4, 6(19)	3,593	-	349	-
	Operating expenses total		(2,601,845)	(13)	(2,573,101)	(14)
6900	Operating income		1,159,840	6	1,537,196	9
7000	Non-operating income and expenses	6(22)
7100	Interest income		15,267	-	37,095	-
7010	Other income		236,406	1	250,128	2
7020	Other gains and losses		213,007	1	208,565	1
7050	Finance costs		(564,102)	(3)	(465,396)	(3)
	Non-operating income and expenses total		(99,422)	(1)	30,392	-
7900	Income from continuing operations before income tax		1,060,418	5	1,567,588	9
7950	Income tax expense	4, 6(24)	(279,132)	(1)	(492,049)	(3)
8200	Net income		781,286	4	1,075,539	6
8300	Other comprehensive income (loss)	6(23)
8360	May be reclassified to profit or loss in subsequent periods
8361	Exchange differences arising on translation of foreign operations		118,693	1	507,487	3
	Total other comprehensive income (loss), net of tax		118,693	1	507,487	3
8500	Total comprehensive income (loss)		$899,979	5	$1,583,026	9
8600	Net income attributable to:
8610	Shareholders of the parent		$748,981	4	$1,050,739	6
8620	Non-controlling interests		32,305	-	24,800	-
			$781,286	4	$1,075,539	6
8700	Total comprehensive income attributable to:
8710	Shareholders of the parent		$810,071	4	$1,547,132	9
8720	Non-controlling interests		89,908	1	35,894	-
			$899,979	5	$1,583,026	9
9750	Earnings per share - basic (in NT$)	6(25)	$2.70		$3.78
9850	Earnings per share - diluted (in NT$)	6(25)	$2.70		$3.78

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the Years Ended December 31, 2025 and 2024

Code	Items	Equity Attributable to Shareholders of the Parent							Non-controlling Interests	Total equity
		Capital	Capital surplus	Retained Earnings			Other Components of equity	Total
				Legal reserve	Special reserve	Accumulated profit or loss	Exchange differences arising on translation of foreign operations
		3100	3200	3310	3320	3350	3410	31XX	36XX	3XXX
A1	Balance as of January 1, 2024	$2,776,746	$2,981,296	$16,209	$324,242	$1,041,825	$(389,953)	$6,750,365	$156,899	$6,907,264
	Appropriation and distribution of 2023 earnings
B1	Legal reserve			100,340		(100,340)		-		-
B3	Special reserve				65,711	(65,711)		-		-
B5	Cash dividends-common shares					(416,512)		(416,512)		(416,512)
D1	Net income for 2024					1,050,739		1,050,739	24,800	1,075,539
D3	Other comprehensive income (loss) for 2024						496,393	496,393	11,094	507,487
D5	Total comprehensive income (loss)	-	-	-	-	1,050,739	496,393	1,547,132	35,894	1,583,026
M7	Charges in ownership interest in subsidiaries		6,418					6,418	141	6,559
Z1	Balance as of December 31, 2024	$2,776,746	$2,987,714	$116,549	$389,953	$1,510,001	$106,440	$7,887,403	$192,934	$8,080,337
A1	Balance as of January 1, 2025	$2,776,746	$2,987,714	$116,549	$389,953	$1,510,001	$106,440	$7,887,403	$192,934	$8,080,337
	Appropriation and distribution of 2024 earnings
B1	Legal reserve			105,074		(105,074)		-		-
B5	Cash dividends-common shares					(416,512)		(416,512)		(416,512)
B17	Reversal of special reserve				(90,287)	90,287		-		-
D1	Net income for 2025					748,981		748,981	32,305	781,286
D3	Other comprehensive income (loss) for 2025						61,090	61,090	57,603	118,693
D5	Total comprehensive income (loss)	-	-	-	-	748,981	61,090	810,071	89,908	899,979
E1	Capital increase by cash	59,000	559,586					618,586		618,586
M7	Charges in ownership interest in subsidiaries		1,899,255					1,899,255	(1,898,128)	1,127
N1	Share-based payments		6,590					6,590		6,590
O1	Non-controlling interests increase (decrease)							-	3,473,423	3,473,423
Z1	Balance as of December 31, 2025	$2,835,746	$5,453,145	$221,623	$299,666	$1,827,683	$167,530	$10,805,393	$1,858,137	$12,663,530

CONSOLIDATED STATEMENTS OF CASH FLOWS

Code	Items	2025	2024	Code	Items	2025	2024
AAAA	Cash flows from operating activities:			BBBB	Cash flows from investing activities:
A10000	Net income before tax	$1,060,418	$1,567,588	B00040	Disposal (acquisition) of financial assets measured at amortized cost	(44,716)	29,046
A20000	Adjustments:			B02700	Acquisition of property, plant and equipment	(6,011,712)	(5,196,975)
A20010	Income and expense adjustments:			B02800	Proceeds from disposal of property, plant and equipment	20,800	25,803
A20100	Depreciation (including right-of-use assets)	1,656,097	1,247,407	B03700	Decrease (increase) in refundable deposits	(24,860)	(18,035)
A20200	Amortization	25,779	18,088	B04500	Acquisition of intangible assets	(18,305)	(56,750)
A20300	Expected credit losses (gain)	(3,593)	(349)	B05350	Acquisition of right-of-use assets	-	(205)
A20400	Net loss (gain) of financial assets at fair value through profit or loss	-	823	B06700	Increase in other non-current assets	(23,554)	1,537
A20900	Interest expense	564,102	465,396	B09900	Increase (decrease) in long-term deferred revenue	71,664	69,035
A21200	Interest income	(15,267)	(37,095)	BBBB	Net cash provided by (used in) investing activities	(6,030,683)	(5,146,544)
A21900	Share-based payment expenses	7,717	6,559
A22500	Loss (gain) on disposal of property, plant and equipment	(4,864)	2,455
A23700	Impairment loss on non-financial assets	5,061	21,565
A29900	Gain on government grants	(54,308)	(53,540)	CCCC	Cash flows from financing activities:
A30000	Changes in operating assets and liabilities:			C00100	Increase in (repayment of) short-term loans	(3,643,445)	4,081,573
A31130	Notes receivable	(70,543)	(66,896)	C01600	Increase in long-term loans	8,380,060	1,859,241
A31150	Accounts receivable	(1,104,130)	(804,616)	C01700	Repayment of long-term loans	(375,881)	(2,731,121)
A31180	Other receivables	4,346	(73,554)	C03000	Increase (decrease) in guarantee deposits	16,912	(65,165)
A31200	Inventories	(1,132,924)	(966,370)	C04020	Payments of lease liabilities	(2,755)	(4,160)
A31230	Prepayments	(94,260)	(340,443)	C04500	Cash dividends	(416,508)	(416,512)
A31240	Other current assets	27,378	(16,409)	C04600	Capital increase by cash	618,586	-
A32125	Contract liabilities	1,384	(22,282)	C05800	Increase(decrease) in non-controlling interests	3,473,423	-
A32130	Notes payable	-	21	CCCC	Net cash provided by (used in) financing activities	8,050,392	2,723,856
A32150	Accounts payable	511,143	860,784
A32180	Other payables	(166,243)	455,976
A32230	Other current liabilities	11,921	1,564	DDDD	Effect of exchange rate changes on cash and cash equivalents	64,909	196,139
A32990	Refund liabilities	40,018	48,453
A32000	Cash generated from operations	1,269,232	2,315,125
A33100	Interest received	15,267	37,095
A33300	Interest paid	(542,879)	(473,934)	EEEE	Net Increase (decrease) in cash and cash equivalents	2,677,024	(525,612)
A33500	Income tax paid	(149,214)	(177,349)	E00100	Cash and cash equivalents at beginning of period	2,849,250	3,374,862
AAAA	Net cash provided by (used in) operating activities	592,406	1,700,937	E00200	Cash and cash equivalents at end of period	$5,526,274	$2,849,250

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of December 31, 2025 and 2024 and for the years then ended

(Amounts Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

History and organization

Dynamic Holding Co., Ltd. (hereinafter referred to as “the Company”) was approved and established on August 25, 2022 and listed for trading on the Taiwan Stock Exchange.

Dynamic Electronics (Taoyuan) Co., Ltd. (hereinafter referred to as “Dynamic Electronics (Taoyuan)”) applied for the establishment of Dynamic Holding Co., Ltd. by the board of directors on March 31, 2022 and the shareholder’s meeting on May 20, 2022 to acquire 100% equity of Dynamic Electronics (Taoyuan). The share swap is to exchange 1 common share of Dynamic Electronics (Taoyuan) for 1 common share of the Company and has been completed on August 25, 2022. On the same day, Dynamic Electronics (Taoyuan) became a 100% subsidiary of the Company and terminated the stock listing and public offering. The Company’s common stock was listed and traded under the stock code “3715” from the same day. The aforementioned share swap was an organizational restructuring under common control. The Company was actually the continuation of Dynamic Electronics (Taoyuan) Co., Ltd., and the parent company only financial statements for the comparative period were prepared as if the entities had been combined from the beginning.

The main activities of the Company and its subsidiaries (“the Group”) are mainly the manufacturing and processing of various electronic components, the design of microcomputers and peripheral equipment, the manufacturing and processing of integrated circuits and substrates, the manufacturing and processing of various circuit boards, the quotation, bidding, and distribution of products from domestic and foreign manufacturers as an agent, and the import and export trading business of the aforementioned products. The Company’s registered office and the main business location is at 6F., No. 50, Minquan Rd., Luzhu Dist., Taoyuan City 338, Taiwan (R.O.C.)

Date and procedures of authorization of financial statements for issue

The consolidated financial statements of the Company and its subsidiaries (“the Group”) were authorized to be issued in accordance with a resolution of the Board of Directors’ meeting held on March 6, 2026.

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

(Amounts Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

Newly issued or revised standards and interpretations

(1) Changes in accounting policies resulting from applying for the first-time certain standards and amendments

The Group applied for the first time International Financial Reporting Standards, International Accounting Standards, and Interpretations issued, revised, or amended which are recognized by the Financial Supervisory Commission ("FSC") and become effective for annual periods beginning on or after January 1, 2025. The adoption of these new standards and amendments had no material impact on the Group.

(2) Standards or interpretations issued, revised or amended, by International Accounting Standards Board ("IASB") which have been endorsed by FSC, and not yet adopted by the Group as at the date when the Group's financial statements were authorized for issue, are listed below.

Items	New, Revised or Amended Standards and Interpretations	Effective Date issued by IASB
A	IFRS 17 “Insurance Contracts”	January 1, 2023
B	Amendments to the Classification and Measurement of Financial Instruments – Amendments to IFRS 9 and IFRS 7	January 1, 2026
C	Annual Improvements to IFRS Accounting Standards – Volume 11	January 1, 2026
D	Contracts Referencing Nature-dependent Electricity – Amendments to IFRS 9 and IFRS 7	January 1, 2026

(A) IFRS 17 "Insurance Contracts"

IFRS 17 provides a comprehensive model for insurance contracts, covering all relevant accounting aspects (including recognition, measurement, presentation and disclosure requirements). The core of IFRS 17 is the General (building block) Model, under this model, on initial recognition, an entity shall measure a group of insurance contracts at the total of the fulfilment cash flows and the contractual service margin. The carrying amount of a group of insurance contracts at the end of each reporting period shall be the sum of the liability for remaining coverage and the liability for incurred claims.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Other than the General Model, the standard also provides a specific adaptation for contracts with direct participation features (the Variable Fee Approach) and a simplified approach (Premium Allocation Approach) mainly for short-duration contracts.

IFRS 17 was issued in May 2017 and it was amended in 2020 and 2021. The amendments include deferral of the date of initial application of IFRS 17 by two years to annual beginning on or after January 1, 2023 (from the original effective date of January 1, 2021); provide additional transition reliefs; simplify some requirements to reduce the costs of applying IFRS 17 and revise some requirements to make the results easier to explain. IFRS 17 replaces an interim Standard – IFRS 4 Insurance Contracts – from annual reporting periods beginning on or after January 1, 2023.

(B) Amendments to the Classification and Measurement of Financial Instruments – Amendments to IFRS 9 and IFRS 7

The amendments include:

a. Clarify that a financial liability is derecognised on the settlement date and describe the accounting treatment for settlement of financial liabilities using an electronic payment system before the settlement date.

b. Clarify how to assess the contractual cash flow characteristics of financial assets that include environmental, social and governance (ESG)-linked features and other similar contingent features.

c. Clarify the treatment of non-recourse assets and contractually linked instruments.

d. Require additional disclosures in IFRS 7 for financial assets and liabilities with contractual terms that reference a contingent event (including those that are ESG-linked), and equity instruments classified at fair value through other comprehensive income.

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese
DYNAMIC HOLDING CO., LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)
(Amounts Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

a. Amendments to IFRS 1

The amendments mainly improve the consistency in wording between first-time adoption of IFRS and requirements for hedge accounting in IFRS 9.

b. Amendments to IFRS 7

The amendments update an obsolete cross-reference relating to gain or loss on derecognition.

c. Amendments to Guidance on implementing IFRS 7

The amendments improve some of the wordings in the implementation guidance, including the introduction, disclosure of deferred difference between fair value and transaction price and credit risk disclosures.

d. Amendments to IFRS 9

The amendments add a cross-reference to resolve potential confusion for a lessee applying the derecognition requirements and clarify the term “transaction price”.

e. Amendments to IFRS 10

The amendments remove the inconsistency between paragraphs B73 and B74 of IFRS 10.

f. Amendments to IAS 7

The amendments remove a reference to “cost method” in paragraph 37 of IAS 7.

(D)Contracts Referencing Nature-dependent Electricity – Amendments to IFRS 9 and IFRS 7

The amendments include:

a. Clarify the application of the ‘own-use’ requirements.

b. Permit hedge accounting if these contracts are used as hedging instruments.

c. Add new disclosure requirements to enable investors to understand the effect of these contracts on a company’s financial performance and cash flows.

The abovementioned standards and amendments are applicable for annual periods beginning on or after January 1, 2026 and have no material impact on the Group.

(3) Standards or interpretations issued, revised or amended, by IASB which have not been endorsed by FSC, and not yet adopted by the Group as at the date when the Group’s financial statements were authorized for issue, are listed below.

Items	New, Revised or Amended Standards and Interpretations	Effective Date Issued by IASB
A	IFRS 10 “Consolidated Financial Statements” and IAS 28 “Investments in Associates and Joint Ventures” – Sale or Contribution of Assets between an Investor and its Associate or Joint Ventures	To be determined by IASB
B	IFRS 18 “Presentation and Disclosure in Financial Statements”	January 1, 2027 (Note)
C	Disclosure Initiative – Subsidiaries without Public Accountability: Disclosures (IFRS 19)	January 1, 2027
D	Translation to a Hyperinflationary Presentation Currency (Amendments to IAS 21 and IAS 29)	January 1, 2027

Note: On 25 September 2025, the FSC announced in a press release that Taiwan will adopt IFRS 18 in 2028.

(A) IFRS 10 “Consolidated Financial Statements” and IAS 28 “Investments in Associates and Joint Ventures” — Sale or Contribution of Assets between an Investor and its Associate or Joint Ventures

The amendments address the inconsistency between the requirements in IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures, in dealing with the loss of control of a subsidiary that is contributed to an associate or a joint venture. IAS 28 restricts gains and losses arising from contributions of non-monetary assets to an associate or a joint venture to the extent of the interest attributable to the other equity holders in the associate or joint ventures. IFRS 10 requires full profit or loss recognition on the loss of control of the subsidiary. IAS 28 was amended so that the gain or loss resulting from the sale or contribution of assets that constitute a business as defined in IFRS 3 between an investor and its associate or joint venture is recognized in full.

IFRS 10 was also amended so that the gains or loss resulting from the sale or contribution of a subsidiary that does not constitute a business as defined in IFRS 3 between an investor and its associate or joint venture is recognized only to the extent of the unrelated investors’ interests in the associate or joint venture.

(B) IFRS 18 “Presentation and Disclosure in Financial Statements”

IFRS 18 replaces IAS 1 Presentation of Financial Statements. The main changes are as below:

a. Improved comparability in the statement of profit or loss (income statement)

IFRS 18 requires entities to classify all income and expenses within their statement of profit or loss into one of five categories: operating; investing; financing; income taxes; and discontinued operations. The first three categories are new, to improve the structure of the income statement, and requires all entities to provide new defined subtotals, including operating profit or loss. The improved structure and new subtotals will give investors a consistent starting point for analyzing entities’ performance and make it easier to compare entities.

b. Enhanced transparency of management-defined performance measures

IFRS 18 requires entities to disclose explanations of those entity-specific measures that are related to the income statement, referred to as management-defined performance measures.

c. Useful grouping of information in the financial statements

IFRS 18 sets out enhanced guidance on how to organize information and whether to provide it in the primary financial statements or in the notes. The changes are expected to provide more detailed and useful information. IFRS 18 also requires entities to provide more transparency about operating expenses, helping investors to find and understand the information they need.

This new standard and its amendments permit subsidiaries without public accountability to provide reduced disclosures when applying IFRS Accounting Standards in their financial statements. IFRS 19 is optional for subsidiaries that are eligible and sets out the disclosure requirements for subsidiaries that elect to apply it.

(D) Translation to a Hyperinflationary Presentation Currency (Amendments to IAS 21 and IAS 29)

a. Clarify that when the entity’s functional currency is that of a non-hyperinflationary economy but its presentation currency is the currency of a hyperinflationary economy, the entity shall translate its results and financial position using the closing rate at the date of the most recent statement of financial position.

b. In the above circumstances, when the presentation currency ceases to be hyperinflationary economy, the entity shall not retranslate amounts that arose before the beginning of the reporting period.

c. When the entity’s functional currency and presentation currency are the currency of a hyperinflationary economy, the entity shall apply the relevant accounting treatment in accordance with paragraph 34 of IAS 29.

The above mentioned standards and interpretations issued by IASB have not yet endorsed by FSC at the date when the Group’s financial statements were authorized for issue, the local effective dates are to be determined by FSC. As the Group is still currently determining the potential impact of the new or amended standards and interpretations listed under (B), it is not practicable to estimate their impact on the Group at this point in time. The remaining new or amended standards and interpretations have no material impact on the Group.

4. Summary of significant accounting policies

(1) Statement of compliance

The consolidated financial statements of the Group for the years ended December 31, 2025 and 2024 have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers (“the Regulations”) and International Financial Reporting Standards, International Accounting Standards, and Interpretations developed by the International Financial Reporting Interpretations Committee or the former Standing Interpretations Committee as endorsed by the FSC.

(2) Basis of preparation

The consolidated financial statements have been prepared on a historical cost basis, except for financial instruments that have been measured at fair value. The consolidated financial statements are presented in thousands of New Taiwan Dollars (“NT$”) unless otherwise specified.

(3) Basis of consolidation

Preparation principle of consolidated financial statements

Control is achieved when the Company is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Company controls an investee if and only if the Company has:

(A) Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee)
(B) Exposure, or rights, to variable returns from its involvement with the investee, and
(C) The ability to use its power over the investee to affect its returns

When the Company has less than a majority of the voting or similar rights of an investee, the Company considers all relevant facts and circumstances in assessing whether it has power over an investee, including:

(A) The contractual arrangement with the other vote holders of the investee
(B) Rights arising from other contractual arrangements
(C) The Company’s voting rights and potential voting rights

The Company re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control.

Subsidiaries are fully consolidated from the acquisition date, being the date on which the Company obtains control, and continue to be consolidated until the date that such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using uniform accounting policies. All intra-group balances, income and expenses, unrealized gains and losses and dividends resulting from intra-group transactions are eliminated in full.

A change in the ownership interest of a subsidiary, without a change of control, is accounted for as an equity transaction.

Total comprehensive income of the subsidiaries is attributed to the owners of the parent and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

If the Company loses control of a subsidiary, it:

(A) Derecognizes the assets (including goodwill) and liabilities of the subsidiary;
(B) Derecognizes the carrying amount of any non-controlling interest;
(C) Recognizes the fair value of the consideration received;
(D) Recognizes the fair value of any investment retained;
(E) Recognizes any surplus or deficit in profit or loss; and
(F) Reclassifies the parent's share of components previously recognized in other comprehensive income to profit or loss, or transfer directly to retained earnings.

The consolidated entities are listed as follows:

Investor	Subsidiary	Main businesses	Percentage of Ownership (%)
			Dec. 31, 2025	Dec. 31, 2024	Note
The Company	Dynamic Electronics (Taoyuan) Co., Ltd.	Investing activities	100.00%	100.00%
The Company	CHIANAN TECHNOLOGY CO., LTD.	Mockup manufacture	70.00%	70.00%
The Company	CHENG CHONG TECHNOLOGY CO., LTD	Mockup manufacture	70.00%	70.00%
Dynamic Electronics (Taoyuan) Co., Ltd.	WINTEK (MAURITIUS) CO., LTD.	Investing activities	100.00%	100.00%

Investor	Subsidiary	Main businesses	Percentage of Ownership (%)
			Dec. 31, 2025	Dec. 31, 2024	Note
WINTEK
(MAURITIUS)
CO., LTD.	Dynamic
Electronics
Holding Pte. Ltd.	Investing
activities	100.00%	100.00%
Dynamic
Electronics
Holding Pte. Ltd.	Dynamic
Electronics Co.,
Ltd. (Huangshi)	Manufacturing
and selling of
PCB	86.0989%	97.8541%	Note 2
Dynamic
Electronics Co.,
Ltd. (Huangshi)	Dynamic
Electronics
(Kunshan) Co.,
Ltd.	Manufacturing
and selling of
PCB	100.00%	100.00%
Dynamic
Electronics Co.,
Ltd. (Huangshi)	Dynamic PCB
Electronics Co.,
Ltd.	PCB and
business which
relates to
import and
export	-%	-%	Note 1
Dynamic
Electronics Co.,
Ltd. (Huangshi)	Dynamic
Electronics Co.,
Ltd. (Seychelles)	PCB and
business which
relates to
import and
export	100.00%	100.00%
Dynamic
Electronics Co.,
Ltd. (Huangshi)	Dynamic
Electronics
Overseas
Investment
Holding Pte. Ltd.
(referred to:
Dynamic Overseas
Investment)	Management
operations
services	100.00%	100.00%

Note 1: Dynamic PCB Electronics Co., Ltd. completed its dissolution process on October 3, 2024.

Note 2: The Company's subsidiary, Dynamic Electronics Co., Ltd. (Huangshi), was officially listed on the Shanghai Stock Exchange on October 24, 2025. On October 15, 2025, its board of directors approved to proceed a cash capital increase by issuing 52,500 thousand shares at a price of RMB 17.08 per share. The Company's subsidiary, Dynamic Electronics Holding Pte. Ltd., did not participate in the cash capital increase according to its original shareholding ratio, resulting in a decrease in its shareholding in Dynamic Electronics Co., Ltd. (Huangshi) from 97.8541% to 86.0989%.

(4) Foreign currency transactions

The Group’s consolidated financial statements are presented in New Taiwan Dollar, which is the parent Company’s functional currency. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency.

Transactions in foreign currencies are initially recorded by the Group entities at their respective functional currency rates prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency closing rate of exchange ruling at the reporting date. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined. Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions.

All exchange differences arising on the settlement of monetary items or on translating monetary items are taken to profit or loss in the period in which they arise except for the following:

(A) Exchange differences arising from foreign currency borrowings for an acquisition of a qualifying asset to the extent that they are regarded as an adjustment to interest costs are included in the borrowing costs that are eligible for capitalization.

(B) Foreign currency items within the scope of IFRS 9 Financial Instruments are accounted for based on the accounting policy for financial instruments.

(C) Exchange differences arising on a monetary item that forms part of a reporting entity’s net investment in a foreign operation is recognized initially in other comprehensive income and reclassified from equity to profit or loss on disposal of the net investment.

When a gain or loss on a non-monetary item is recognized in other comprehensive income, any exchange component of that gain or loss is recognized in other comprehensive income. When a gain or loss on a non-monetary item is recognized in profit or loss, any exchange component of that gain or loss is recognized in profit or loss.

(5) Translation of financial statements in foreign currency

The assets and liabilities of foreign operations are translated into New Taiwan Dollar at the closing rate of exchange prevailing at the balance sheet date and their income and expenses are translated at an average rate for the period. The exchange differences arising on the translation are recognized in other comprehensive income. On disposal of the foreign operation, the cumulative amount of the exchange differences relating to that foreign operation, recognized in other comprehensive income and accumulated in the separate component of equity, is reclassified from equity to profit or loss when the gain or loss on disposal recognized.

On the partial disposal of a subsidiary that includes a foreign operation that does not result in a loss of control, the proportionate share of the cumulative amount of the exchange differences recognized in other comprehensive income is re-attributed to the NCIs in that foreign operation, instead of recognized in profit or loss. In partial disposal of an associate or jointly controlled entity that includes a foreign operation that does not result in a loss of significant influence or joint control, only the proportionate share of the cumulative amount of the exchange differences recognized in other comprehensive income is reclassified to profit or loss.

Any goodwill and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and expressed in its functional currency.

(6) Current and non-current distinction

An asset is classified as current when:

(A) The Group expects to realize the asset, or intends to sell or consume it, in its normal operating cycle
(B) The Group holds the asset primarily for the purpose of trading
(C) The Group expects to realize the asset within twelve months after the reporting period
(D) The asset is cash or a cash equivalent unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is classified as current when:

(A) The Group expects to settle the liability in its normal operating cycle
(B) The Group holds the liability primarily for the purpose of trading
(C) The liability is due to be settled within twelve months after the reporting period
(D) The Group does not have the right at the end of the reporting period to defer settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as non-current.

(7) Cash and cash equivalents

Cash and cash equivalents comprise cash on hand, demand deposits and short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

(8) Financial instruments

Financial assets and financial liabilities are recognized when the Group becomes a party to the contractual provisions of the instrument.

Financial assets and financial liabilities within the scope of IFRS 9 Financial Instruments are recognized initially at fair value plus or minus, in the case of investments not at fair value through profit or loss, directly attributable transaction costs.

(A) Financial assets: Recognition and Measurement

The Group accounts for regular way purchase or sales of financial assets on the trade date.

The Group classified financial assets as subsequently measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss considering both factors below:

(a) The Group’s business model for managing the financial assets and
(b) The contractual cash flow characteristics of the financial asset.

Financial assets measured at amortized cost

A financial asset is measured at amortized cost if both of the following conditions are met and presented as note receivables, trade receivables financial assets measured at amortized cost and other receivables etc., on balance sheet as at the reporting date:

(a) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and
(b) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Such financial assets are subsequently measured at amortized cost (the amount at which the financial asset is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between the initial amount and the maturity amount and adjusted for any loss allowance) and is not part of a hedging relationship. A gain or loss is recognized in profit or loss when the financial asset is derecognized, through the amortization process or in order to recognize the impairment gains or losses.

Interest revenue is calculated by using the effective interest method. This is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for:

(a) Purchased or originated credit-impaired financial assets. For those financial assets, the Group applies the credit-adjusted effective interest rate to the amortized cost of the financial asset from initial recognition.

(b) Financial assets that are not purchased or originated credit-impaired financial assets but subsequently have become credit-impaired financial assets. For those financial assets, the Group applies the effective interest rate to the amortized cost of the financial asset in subsequent reporting periods.

Financial asset measured at fair value through other comprehensive income

A financial asset is measured at fair value through other comprehensive income if both of the following conditions are met:

(a) The financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and
(b) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Recognition of gain or loss on a financial asset measured at fair value through other comprehensive income are described as below:

(a) A gain or loss on a financial asset measured at fair value through other comprehensive income recognized in other comprehensive income, except for impairment gains or losses and foreign exchange gains and losses, until the financial asset is derecognized or reclassified.
(b) When the financial asset is derecognized the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss as a reclassification adjustment.
(c) Interest revenue is calculated by using the effective interest method. This is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for:

(i) Purchased or originated credit-impaired financial assets. For those financial assets, the Group applies the credit-adjusted effective interest rate to the amortized cost of the financial asset from initial recognition.

(ii) Financial assets that are not purchased or originated credit-impaired financial assets but subsequently have become credit-impaired financial assets. For those financial assets, the Group applies the effective interest rate to the amortized cost of the financial asset in subsequent reporting periods.

Besides, for certain equity investments within the scope of IFRS 9 that is neither held for trading nor contingent consideration recognized by an acquirer in a business combination to which IFRS 3 applies, the Group made an irrevocable election to present the changes of the fair value in other comprehensive income at initial recognition. Amounts presented in other comprehensive income shall not be subsequently transferred to profit or loss (when disposal of such equity instrument, its cumulated amount included in other components of equity is transferred directly to the retained earnings) and these investments should be presented as financial assets measured at fair value through other comprehensive income on the balance sheet. Dividends on such investment are recognized in profit or loss unless the dividends clearly represent a recovery of part of the cost of investment.

Financial asset measured at fair value through profit or loss

Financial assets were classified as measured at amortized cost or measured at fair value through other comprehensive income based on aforementioned criteria. All other financial assets were measured at fair value through profit or loss and presented on the balance sheet as financial assets measured at fair value through profit or loss.

Such financial assets are measured at fair value, the gains or losses resulting from remeasurement is recognized in profit or loss which includes any dividend or interest received on such financial assets.

(B) Impairment of financial assets

The Group recognizes a loss allowance for expected credit losses on debt instrument investments measured at fair value through other comprehensive income and financial asset measured at amortized cost. The loss allowance on debt instrument investments measured at fair value through other comprehensive income is recognized in other comprehensive income and not reduce the carrying amount in the balance sheet.

The Group measures expected credit losses of a financial instrument in a way that reflects:

(a) An unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes;

(b) The time value of money; and

(c) Reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and forecasts of future economic conditions.

The loss allowance is measures as follows:

(a) At an amount equal to 12-month expected credit losses: the credit risk on a financial asset has not increased significantly since initial recognition or the financial asset is determined to have low credit risk at the reporting date. In addition, the Company measures the loss allowance at an amount equal to lifetime expected credit losses in the previous reporting period, but determines at the current reporting date that the credit risk on a financial asset has increased significantly since initial recognition is no longer met.

(b) At an amount equal to the lifetime expected credit losses: the credit risk on a financial asset has increased significantly since initial recognition or financial asset that is purchased or originated credit-impaired financial asset.

(c) For trade receivables or contract assets arising from transactions within the scope of IFRS 15, the Group measures the loss allowance at an amount equal to lifetime expected credit losses.

(d) For lease receivables arising from transactions within the scope of IFRS 16, the Group measures the loss allowance at an amount equal to lifetime expected credit losses.

At each reporting date, the Group needs to assess whether the credit risk on a financial asset has increased significantly since initial recognition by comparing the risk of a default occurring at the reporting date and the risk of default occurring at initial recognition. Please refer to Note 12 for further details on credit risk.

Financial asset is derecognized when:

(a) The rights to receive cash flows from the asset have expired
(b) The Group has transferred the asset and substantially all the risks and rewards of the asset have been transferred
(c) The Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

On derecognition of a financial asset in its entirety, the difference between the carrying amount and the consideration received or receivable including any cumulative gain or loss that had been recognized in other comprehensive income, is recognized in profit or loss.

(D) Financial liabilities and equity

Classification between liabilities or equity

The Group classifies the instrument issued as a financial liability or an equity instrument in accordance with the substance of the contractual arrangement and the definitions of a financial liability, and an equity instrument.

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. The transaction costs of an equity transaction are accounted for as a deduction from equity (net of any related income tax benefit) to the extent they are incremental costs directly attributable to the equity transaction that otherwise would have been avoided.

Compound instruments

The Group evaluates the terms of the convertible bonds issued to determine whether it contains both a liability and an equity component. Furthermore, the Group assesses if the economic characteristics and risks of the put and call options contained in the convertible bonds are closely related to the economic characteristics and risk of the host contract before separating the equity element.

For the liability component excluding the derivatives, its fair value is determined based on the rate of interest applied at that time by the market to instruments of comparable credit status. The liability component is classified as a financial liability measured at amortized cost before the instrument is converted or settled.

For the embedded derivative that is not closely related to the host contract (for example, if the exercise price of the embedded call or put option is not approximately equal on each exercise date to the amortized cost of the host debt instrument), it is classified as a liability component and subsequently measured at fair value through profit or loss unless it qualifies for an equity component. The equity component is assigned the residual amount after deducting from the fair value of the instrument as a whole the amount separately determined for the liability component. Its carrying amount is not remeasured in the subsequent accounting periods. If the convertible bond issued does not have an equity component, it is accounted for as a hybrid instrument in accordance with the requirements under IFRS 9 Financial Instruments.

Transaction costs are apportioned between the liability and equity components of the convertible bond based on the allocation of proceeds to the liability and equity components when the instruments are initially recognized.

On conversion of a convertible bond before maturity, the carrying amount of the liability component being the amortized cost at the date of conversion is transferred to equity.

Financial liabilities

Financial liabilities within the scope of IFRS 9 Financial Instruments are classified as financial liabilities at fair value through profit or loss or financial liabilities measured at amortized cost upon initial recognition.

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated as at fair value through profit or loss. A financial liability is classified as held for trading if:

(a) It is acquired or incurred principally for the purpose of selling or repurchasing it in the near term;

(b) On initial recognition it is part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a recent actual pattern of short-term profit-taking; or

(c) It is a derivative (except for a derivative that is a financial guarantee contract or a designated and effective hedging instrument).

If a contract contains one or more embedded derivatives, the entire hybrid (combined) contract may be designated as a financial liability at fair value through profit or loss; or a financial liability may be designated as at fair value through profit or loss when doing so results in more relevant information, because either:

(a) It eliminates or significantly reduces a measurement or recognition inconsistency; or

(b) A group of financial assets, financial liabilities or both is managed and its performance is evaluated on a fair value basis, in accordance with a documented risk management or investment strategy, and information about the group is provided internally on that basis to the key management personnel.

Gains or losses on the subsequent measurement of liabilities at fair value through profit or loss including interest paid are recognized in profit or loss.

Financial liabilities at amortized cost

Financial liabilities measured at amortized cost include interest bearing loans and borrowings that are subsequently measured using the effective interest rate method after initial recognition. Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the effective interest rate method amortization process.

Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or transaction costs.

Derecognition of financial liabilities

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires.

When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified (whether or not attributable to the financial difficulty of the debtor), such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss.

(E) Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount reported in the balance sheet if, and only if, there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, or to realize the assets and settle the liabilities simultaneously.

(9) Derivative instrument

The Group uses derivative instruments to hedge its foreign currency risks and interest rate risks. A derivative is classified in the balance sheet as financial assets or liabilities at fair value through profit or loss except for derivatives that are designated as and effective hedging instruments which are classified as financial assets or liabilities for hedging.

Derivative instruments are initially recognized at fair value on the date on which a derivative contract is entered into and are subsequently remeasured at fair value. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative. The changes in fair value of derivatives are taken directly to profit or loss, except for the effective portion of hedges, which is recognized in either profit or loss or equity according to types of hedges used.

When the host contracts are either non-financial assets or liabilities, derivatives embedded in host contracts are accounted for as separate derivatives and recorded at fair value if their economic characteristics and risks are not closely related to those of the host contracts and the host contracts are not designated at fair value though profit or loss.

(10) Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

(A) In the principal market for the asset or liability, or
(B) In the absence of a principal market, in the most advantageous market for the asset or liability

The principal or the most advantageous market must be accessible to by the Group.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

(11) Inventories

Inventories are valued at lower of cost and net realizable value item by item.

Costs incurred in bringing each inventory to its present location and condition are accounted for as follows:

Raw materials - By actual purchase cost with weighted average method

Finished goods and work in progress - Cost of direct materials and labor and a proportion of manufacturing overheads based on normal operating capacity but excluding borrowing costs.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.

(12) Property, plant and equipment

Property, plant and equipment is stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of dismantling and removing the item and restoring the site on which it is located and borrowing costs for construction in progress if the recognition criteria are met. Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately. When significant parts of property, plant and equipment are required to be replaced in intervals, the Group recognized such parts as individual assets with specific useful lives and depreciation, respectively. The carrying amount of those parts that are replaced is derecognized in accordance with the derecognition provisions of IAS 16 "Property, plant and equipment". When a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized in profit or loss as incurred.

Depreciation is calculated on a straight-line basis over the estimated economic lives of the following assets:

Buildings	16~30 years
Machinery and equipment	1~10 years
Transportation equipment	3~6 years
Office equipment	1~6 years
Other equipment	1~5 years
Leasehold improvement	1 year

An item of property, plant and equipment and any significant part initially recognized is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset is recognized in profit or loss.

The assets’ residual values, useful lives and methods of depreciation are reviewed at each financial year end and adjusted prospectively, if appropriate.

(13) Leases

The Group assesses whether the contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset for a period of time, the Group assesses whether, throughout the period of use, has both of the following:

(A) The right to obtain substantially all of the economic benefits from use of the identified asset; and

(B) The right to direct the use of the identified asset.

For a contract that is, or contains, a lease, the Group accounts for each lease component within the contract as a lease separately from non-lease components of the contract. For a contract that contains a lease component and one or more additional lease or non-lease components, the Group allocates the consideration in the contract to each lease component on the basis of the relative stand-alone price of the lease component and the aggregate stand-alone price of the non-lease components. The relative stand-alone price of lease and non-lease components shall be determined on the basis of the price the lessor, or a similar supplier, would charge the Group for that component, or a similar component, separately. If an observable stand-alone price is not readily available, the Group estimates the stand-alone price, maximizing the use of observable information.

Group as a lessee

Except for leases that meet and elect short-term leases or leases of low-value assets, the Group recognizes right-of-use asset and lease liability for all leases which the Group is the lessee of those lease contracts.

At the commencement date, the Group measures the lease liability at the present value of the lease payments that are not paid at that date. The lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate cannot be readily determined, the Company uses its incremental borrowing rate. At the commencement date, the lease payments included in the measurement of the lease liability comprise the following payments for the right to use the underlying asset during the lease term that are not paid at the commencement date:

(A) fixed payments (including in-substance fixed payments), less any lease incentives receivable;

(B) variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;

(D) the exercise price of a purchase option if the Group is reasonably certain to exercise that option; and

(E) payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease.

After the commencement date, the Group measures the lease liability on an amortised cost basis, which increases the carrying amount to reflect interest on the lease liability by using an effective interest method; and reduces the carrying amount to reflect the lease payments made.

At the commencement date, the Group measures the right-of-use asset at cost. The cost of the right-of-use asset comprises:

(A) the amount of the initial measurement of the lease liability;

(B) any lease payments made at or before the commencement date, less any lease incentives received;

(D) an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease.

For subsequent measurement of the right-of-use asset, the Group measures the right-of-use asset at cost less any accumulated depreciation and any accumulated impairment losses. That is, the Group measures the right-of-use applying a cost model.

If the lease transfers ownership of the underlying asset to the Group by the end of the lease term or if the cost of the right-of-use asset reflects that the Group will exercise a purchase option, the Group depreciates the right-of-use asset from the commencement date to the end of the useful life of the underlying asset. Otherwise, the Group depreciates the right-of-use asset from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term.

The Group applies IAS 36 “Impairment of Assets” to determine whether the right-of-use asset is impaired and to account for any impairment loss identified.

Except for those leases that the Group accounted for as short-term leases or leases of low-value assets, the Group presents right-of-use assets and lease liabilities in the balance sheet and separately presents lease-related interest expense and depreciation charge in the statement of comprehensive income.

For short-term leases or leases of low-value assets, the Group elects to recognize the lease payments associated with those leases as an expense on either a straight-line basis over the lease term or another systematic basis.

(14) Intangible assets

Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is its fair value as of the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses, if any. Internally generated intangible assets, excluding capitalized development costs, are not capitalized and expenditure is reflected in profit or loss for the year in which the expenditure is incurred.

The useful lives of intangible assets are assessed as either finite or indefinite.

Intangible assets with finite lives are amortized over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired.

The amortization period and the amortization method for an intangible asset with a finite useful life is reviewed at least at the end of each financial year. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset is accounted for by changing the amortization period or method, as appropriate, and are treated as changes in accounting estimates.

Intangible assets with indefinite useful lives are not amortized, but are tested for impairment annually, either individually or at the cash-generating unit (CGU) level. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in profit or loss when the asset is derecognized.

A summary of the policies applied to the Group’s intangible assets is as follows:

	Computer software	Technology Expertise	Other intangible assets
Useful lives	1~5 years	3~5 years	5 years
Amortization method used	Amortized on a straight-line basis over the estimated useful life	Amortized on a straight-line basis over the estimated useful life	Amortized on a straight-line basis over the estimated useful life
Internally generated or acquired	Acquired	Acquired	Acquired

(15) Impairment of non-financial assets

The Group assesses at the end of each reporting period whether there is any indication that an asset in the scope of IAS 36 Impairment of Assets may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (“CGU”) fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

For assets excluding goodwill, an assessment is made at each reporting date as to whether there is any indication that previously recognized impairment losses may no longer exist or may have decreased. If such indication exists, the Group estimates the recoverable amount of the asset or CGU. A previously recognized impairment loss is reversed only if there has been an increase in the estimated service potential of an asset which in turn increases the recoverable amount. However, the reversal is limited so that the carrying amount of the asset does not exceed the carrying amount that would have been determined, net of depreciation or amortization, had no impairment loss been recognized for the asset in prior years.

A CGU, or groups of CGUs, to which goodwill has been allocated is tested for impairment annually at the same time, irrespective of whether there is any indication of impairment. If an impairment loss is to be recognized, it is first allocated to reduce the carrying amount of any goodwill allocated to the cash generating unit (group of units), then to the other assets of the unit (group of units) pro rata on the basis of the carrying amount of each asset in the unit (group of units). Impairment losses relating to goodwill cannot be reversed in future periods for any reason.

An impairment loss of continuing operations or a reversal of such impairment loss is recognized in profit or loss.

(16) Provisions

Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where the Group expects some or all of a provision to be reimbursed, the reimbursement is recognized as a separate asset but only when the reimbursement is virtually certain. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.

The liability to pay a levy is recognized progressively if the obligating event occurs over a period of time.

(17) Revenue recognition

The Group’s revenue arising from contracts with customers are primarily related to sale of goods. The accounting policies are explained as follow:

Sales of goods

The Group mainly manufactures and sells of its products. Sales are recognized when control of the goods is transferred to the customer and the goods are delivered to the customers. The main product of the Group is PCB and revenue is recognized based on the consideration stated in the contract. The remaining sales transactions are usually accompanied by volume discounts (based on the accumulated total sales amount for a specified period). Therefore, revenue from these sales is recognized based on the price specified in the contract, net of the estimated volume discounts. Accumulated experience is used to estimate and provide for the discounts, using the expected value method. Revenue is only recognized to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur and when the uncertainty associated with the variable consideration is subsequently resolved. During the period specified in the contract, refund liability is recognized for the products expected to be returned.

The credit period of the Group’s sale of goods is from 60 to 150 days. For most of the contracts, when the Group transfers the goods to customers and has a right to an amount of consideration that is unconditional, these contracts are recognized as trade receivables. The Group usually collects the payments shortly after transfer of goods to customers; therefore, there is no significant financing component to the contract. For some of the contracts, the Group has transferred the goods to customers but does not has a right to an amount of consideration that is unconditional, these contacts should be presented as contract assets. Besides, in accordance with IFRS 9, the Group measures the loss allowance for a contract asset at an amount equal to the lifetime expected credit losses.

(18) Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective assets. All other borrowing costs are expensed in the period they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

(19) Government grants

Government grants are recognized where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. Where the grant relates to an asset, it is recognized as deferred income and released to income in equal amounts over the expected useful life of the related asset. When the grant relates to an expense item, it is recognized as income over the period necessary to match the grant on a systematic basis to the costs that it is intended to compensate.

Where the Group receives non-monetary grants, the asset and the grant are recorded gross at nominal amounts and released to the statement of comprehensive income over the expected useful life and pattern of consumption of the benefit of the underlying asset by equal annual installments. Where loans or similar assistance are provided by governments or related institutions with an interest rate below the current applicable market rate, the effect of this favorable interest is regarded as additional government grant.

(20) Post-employment benefits

All regular employees of Dynamic and its domestic subsidiaries are entitled to pension plans that are managed by an independently administered pension fund committee. Fund assets are deposited under the committee’s name in the specific bank account and hence, not associated with Dynamic and its domestic subsidiaries. Therefore, fund assets are not included in the Group’s consolidated financial statements. Pension benefits for employees of the overseas subsidiaries and the branches are provided in accordance with the respective local regulations.

For the defined contribution plan, Dynamic and its domestic subsidiaries will make a monthly contribution of no less than 6% of the monthly wages of the employees subject to the plan. The Company recognizes expenses for the defined contribution plan in the period in which the contribution becomes due. Overseas subsidiaries and branches make contribution to the plan based on the requirements of local regulations and the contribution is expensed as incurred.

(21) Income tax

Income tax expense (benefit) is the aggregate amount included in the determination of profit or loss for the period in respect of current tax and deferred tax.

Current income tax

Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the end of the reporting period. Current income tax relating to items recognized in other comprehensive income or directly in equity is recognized in other comprehensive income or equity and not in profit or loss.

The income tax for undistributed earnings is recognized as income tax expense in the subsequent year when the distribution proposal is approved by the Shareholders’ meeting.

Deferred tax

Deferred tax is provided on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts in balance sheet at the reporting date.

Deferred tax liabilities are recognized for all taxable temporary differences, except:

(A) Where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination; at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and at the time of the transaction, does not give rise to equal taxable and deductible temporary differences.

(B) In respect of taxable temporary differences associated with investments in subsidiaries, and associates and interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred tax assets are recognized for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized, except:

(A) Where the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination; at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and at the time of the transaction, does not give rise to equal taxable and deductible temporary differences.

(B) In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint arrangements, deferred tax assets are recognized only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilized.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the reporting date. The measurement of deferred tax assets and deferred tax liabilities reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. Deferred tax relating to items recognized outside profit or loss is recognized outside profit or loss. Deferred tax items are recognized in correlation to the underlying transaction either in other comprehensive income or directly in equity. Deferred tax assets are reassessed at each reporting date and are recognized accordingly.

Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current income tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

According to the temporary exception in the International Tax Reform – Pillar Two Model Rules (Amendments to IAS 12), information about deferred tax assets and liabilities related to Pillar Two income tax will neither be recognized nor be disclosed.

(22) Business combinations and goodwill

Business combinations are accounted for using the acquisition method. The consideration transferred, the identifiable assets acquired and liabilities assumed are measured at acquisition date fair value. For each business combination, the acquirer measures any non-controlling interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s identifiable net assets. Acquisition-related costs are accounted for as expenses in the periods in which the costs are incurred and are classified under administrative expenses.

When the Group acquires a business, it assesses the assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date. This includes the separation of embedded derivatives in host contracts by the acquiree.

If the business combination is achieved in stages, the acquisition date fair value of the acquirer’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date through profit or loss.

Any contingent consideration to be transferred by the acquirer will be recognized at the acquisition-date fair value. Subsequent changes to the fair value of the contingent consideration which is deemed to be an asset or liability, will be recognized in accordance with IFRS 9 Financial Instruments either in profit or loss or as a change to other comprehensive income. However, if the contingent consideration is classified as equity, it should not be remeasured until it is finally settled within equity.

Goodwill is initially measured as the amount of the excess of the aggregate of the consideration transferred and the non-controlling interest over the net fair value of the identifiable assets acquired and the liabilities assumed. If this aggregate is lower than the fair value of the net assets acquired, the difference is recognized in profit or loss.

After initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Group’s cash-generating units that are expected to benefit from the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units. Each unit or group of units to which the goodwill is so allocated represents the lowest level within the Group at which the goodwill is monitored for internal management purpose and is not larger than an operating segment before aggregation.

Where goodwill forms part of a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation. Goodwill disposed of in this circumstance is measured based on the relative recoverable amounts of the operation disposed of and the portion of the cash-generating unit retained.

Significant accounting judgments, estimates and assumptions

The preparation of the Group’s consolidated financial statements require management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the end of the reporting period. However, uncertainty about these assumption and estimate could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in future periods.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(1) Fair values of financial instruments

Where the fair value of financial assets and financial liabilities recorded in the balance sheet cannot be derived from active markets, they are determined using valuation techniques including the income approach (for example the discounted cash flows model) or market approach. Changes in assumptions about these factors could affect the reported fair value of the financial instruments. Please refer to Note 12 for more details.

(2) Accounts receivable-estimation of impairment loss

The Group estimates the impairment loss of trade receivables at an amount equal to lifetime expected credit losses. The credit loss is the present value of the difference between the contractual cash flows that are due under the contract (carrying amount) and the cash flows that expects to receive (evaluate forward looking information). However, as the impact from the discounting of short-term receivables is not material, the credit loss is measured by the undiscounted cash flows. Where the actual future cash flows are lower than expected, a material impairment loss may arise. Please refer to Note 6 for more details.

(3) Inventory

Inventories are valued at the lower of cost and net realizable value item by item. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. The change of market may also significantly influence the evaluation of inventory. For inventory details, please refer to Note 6 to the consolidated financial statements.

(4) Revenue recognition-sale returns and allowance

The Group estimates sales returns and allowance based on historical experience and other known factors at the time of sale, which reduces the operating revenue. In assessing the aforementioned sales returns and allowance, revenue is recognized to the extent it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Please refer to Note 6 for more details.

(5) Income tax

Uncertainties exist with respect to the interpretation of complex tax regulations and the amount and timing of future taxable income. Given the wide range of international business relationships and the long-term nature and complexity of existing contractual agreements, differences arising between the actual results and the assumptions made, or future changes to such assumptions, could necessitate future adjustments to tax income and expense already recorded. The Group establishes provisions, based on reasonable estimates, for possible consequences of audits by the tax authorities of the respective counties in which it operates. The amount of such provisions is based on various factors, such as experience of previous tax audits and differing interpretations of tax regulations by the taxable entity and the responsible tax authority. Such differences of interpretation may arise on a wide variety of issues depending on the conditions prevailing in the respective company's domicile.

Deferred tax assets are recognized for all carryforward of unused tax losses and unused tax credits and deductible temporary differences to the extent that it is probable that taxable profit will be available or there are sufficient taxable temporary differences against which the unused tax losses, unused tax credits or deductible temporary differences can be utilized. The amount of deferred tax assets determined to be recognized is based upon the likely timing and the level of future taxable profits and taxable temporary differences together with future tax planning strategies.

6. Contents of significant accounts

(1) Cash and cash equivalents

	As of
	Dec. 31, 2025	Dec. 31, 2024
Cash on hand	$1,572	$1,565
Checking and savings	5,444,702	2,767,685
Fixed-term deposits (Note)	80,000	80,000
Total	$5,526,274	$2,849,250

Note: The contract will expire within 3 months and it must be readily convertible to a known amount of cash and be subject to an insignificant risk of changes in value.

(2) Financial assets measured at amortized cost

	As of
	Dec. 31, 2025	Dec. 31, 2024
Restricted deposits	$44,716	$-
Current	$44,716	$-
Non-current	$-	$-

The Group transacts with financial institutions with good credit rating. Consequently, there is no material credit risk.

Please refer to Note 8 for more details on financial assets measured at amortized cost pledged as collaterals.

(3) Notes receivable, net

	As of
	Dec. 31, 2025	Dec. 31, 2024
Notes receivable arising from operating activities	$478,967	$408,424
Less: loss allowance	-	-
Total	$478,967	$408,424

(A) The Group follows the requirement of IFRS 9 to assess the impairment. Please refer to Note 6(19) for more details on loss allowance and Note 12 for details on credit risk.

(B) The Group has signed sale contracts with recourse rights for some of its notes receivable with financial institutions. Although the Group has transferred its rights in the cash flow contract of the notes receivable, it still has to bear the credit risk of the irrecoverability of the notes receivable according to the contract, which does not meet the conditions for delisting financial assets. The transaction-related information is as follows:

Party for sale	Amount transferred	Amount advanced (Note)	Interest Rate
As of Dec. 31, 2025
None
As of Dec. 31, 2024
China Construction Bank and Agricultural Bank of China	$130,036	$130,036	Negotiate by per transaction

Note: Listed as short-term loans, please refer to Note 8 for information on short-term loans and related guarantees.

(4) Accounts receivable, net

(A) Details of accounts receivable, net are as follows:

	As of
	Dec. 31, 2025	Dec. 31, 2024
Accounts receivable arising from operating activities	$6,376,265	$5,272,135
Less: loss allowance	(15,215)	(19,470)
Total	$6,361,050	$5,252,665

(B) Accounts receivables were not pledged.

(C) Accounts receivables are generally on 60 to 150 day terms. As of December 31, 2025 and 2024, the total carrying amount were NT$6,376,265 thousand and NT$5,272,135 thousand, respectively. Please refer to Note 6(19) for more details on loss allowance of accounts receivable for the years ended December 31, 2025 and 2024. Please refer to Note 12 for more details on credit risk management.

(5) Inventories

(A) Details of inventories, net are as follows:

	As of
	Dec. 31, 2025	Dec. 31, 2024
Raw materials and supplies	$542,756	$339,189
Work in progress	1,223,760	818,236
Finished goods	2,593,160	2,069,327
Total	$4,359,676	$3,226,752

(B) The cost of inventories recognized in expenses amounted to NT$15,691,276 thousand and NT$13,676,707 thousand for the years ended December 31, 2025 and 2024. The following losses were included in cost of sales:

	For the years ended December 31,
Item	2025	2024
Inventory valuation losses (gains on recovery of inventory)	$66,721	$2,249

(6) Property, plant and equipment

	As of
	Dec. 31, 2025	Dec. 31, 2024
Owner occupied property, plant and equipment	$18,472,852	$15,475,105
Prepayment for equipment	1,653,485	2,128,395
Total	$20,126,337	$17,603,500
	Land	Buildings
---	---	---
Cost:
As of Jan. 1, 2025	$349,807	$11,305,581
Additions	-	5,135
Disposals	-	-
Other changes	18,556	517,008
Exchange differences	14,392	6,056
As of Dec. 31, 2025	$382,755	$11,833,780

	Land	Buildings	Machinery and equipment	Transportation equipment	Office equipment	Other equipment	Lease improvement	Construction in progress and equipment to be examined (including prepayment for equipment)	Total
Cost:
As of Jan. 1, 2024	$-	$7,096,433	$9,555,568	$28,672	$70,524	$463,033	$8,820	$1,325,663	$18,548,713
Additions	-	1,036,144	229,647	1,894	2,921	77,647	-	5,606,750	6,955,003
Disposals	-	-	(324,835)	(598)	(311)	(20,690)	-	-	(346,434)
Other changes	349,807	2,803,694	1,930,092	6,400	56,091	50,230	-	(4,742,069)	454,245
Exchange differences	-	369,310	503,079	1,411	3,302	23,350	-	79,503	979,955
As of Dec. 31, 2024	$349,807	$11,305,581	$11,893,551	$37,779	$132,527	$593,570	$8,820	$2,269,847	$26,591,482
Depreciation and impairment:
As of Jan. 1, 2025	$-	$2,537,146	$5,871,708	$26,864	$77,478	$465,966	$8,820	$-	$8,987,982
Depreciation	-	531,700	1,005,819	3,465	21,853	81,500	-	-	1,644,337
Impairment loss	-	-	4,924	-	-	137	-	-	5,061
Disposals	-	-	(28,092)	(155)	(767)	-	-	-	(29,014)
Exchange differences	-	(26,651)	(80,274)	(308)	300	(6,319)	-	-	(113,252)
As of Dec. 31, 2025	$-	$3,042,195	$6,774,085	$29,866	$98,864	$541,284	$8,820	$-	$10,495,114
Depreciation and impairment:
As of Jan. 1, 2024	$-	$2,048,027	$5,117,752	$23,860	$62,530	$370,677	$8,820	$-	$7,631,666
Depreciation	-	373,390	760,800	2,375	11,775	85,875	-	-	1,234,215
Impairment loss	-	-	11,325	-	-	240	-	-	11,565
Disposal	-	-	(305,718)	(598)	(288)	(11,572)	-	-	(318,176)
Exchange differences	-	115,729	287,549	1,227	3,461	20,746	-	-	428,712
As of Dec. 31, 2024	$-	$2,537,146	$5,871,708	$26,864	$77,478	$465,966	$8,820	$-	$8,987,982
Net carrying amount as of:
Dec. 31, 2025	$382,755	$8,791,585	$8,596,736	$14,612	$47,976	$91,791	$-	$2,200,882	$20,126,337
Dec. 31, 2024	$349,807	$8,768,435	$6,021,843	$10,915	$55,049	$127,604	$-	$2,269,847	$17,603,500

(A) For the year ended December 31, 2025 and 2024, NT$5,061 thousand and NT$11,565 thousand impairment loss represented the write down of certain property, plant and equipment to the recoverable amount. This has been recognized in the statement of comprehensive income.

(B) Significant Components of building include main building structure, and additional expansion construction, which are depreciated over useful 16~30 years and 20 years, respectively.

(7) Intangible assets

	Computer software	Technology expertise	Goodwill	Other	Total
Cost:
As of January 1, 2025	$94,007	$13,487	$62,244	$4,330	$174,068
Additions – acquired separately	18,305	-	-	-	18,305
Derecognized upon retirement	(11,702)	-	-	-	(11,702)
Exchange differences	549	(264)	-	178	463
As of December 31, 2025	$101,159	$13,223	$62,244	$4,508	$181,134
As of January 1, 2024	$42,794	$10,556	$62,244	$-	$115,594
Additions – acquired separately	52,420	-	-	4,330	56,750
Derecognized upon retirement	(3,079)	-	-	-	(3,079)
Exchange differences	1,872	2,931	-	-	4,803
As of December 31, 2024	$94,007	$13,487	$62,244	$4,330	$174,068

	Computer software	Technology expertise	Goodwill	Other	Total
Amortization and impairment:
As of January 1, 2025	$45,081	$10,040	$40,018	$72	$95,211
Amortization	23,792	1,560	-	427	25,779
Derecognized upon retirement	(11,702)	-	-	-	(11,702)
Exchange differences	615	(149)	-	27	493
As of December 31, 2025	$57,786	$11,451	$40,018	$526	$109,781
As of January 1, 2024	$30,534	$7,390	$30,018	$-	$67,942
Amortization	15,804	2,216	-	68	18,088
Impairment loss	-	-	10,000	-	10,000
Derecognized upon retirement	(3,079)	-	-	-	(3,079)
Exchange differences	1,822	434	-	4	2,260
As of December 31, 2024	$45,081	$10,040	$40,018	$72	$95,211
Net carrying amounts as of:
December 31, 2025	$43,373	$1,772	$22,226	$3,982	$71,353
December 31, 2024	$48,926	$3,447	$22,226	$4,258	$78,857

Amortization of intangible assets is as follows:

	For the years ended December 31,
	2025	2024
Operating costs	$2,413	$2,267
Operating expenses	23,366	15,821
Total	$25,779	$18,088

(8) Impairment testing of goodwill

Goodwill acquired through business combinations has been allocated to two cash-generating units, for impairment testing as follows:

	As of
	Dec. 31, 2025	Dec. 31, 2024
Subsidiary-CHENG CHONG TECHNOLOGY CO., LTD	$22,226	$22,226
Subsidiary-CHIANAN TECHNOLOGY CO., LTD.	-	-
Total	$22,226	$22,226

(A) The recoverable amount of CHENG CHONG TECHNOLOGY CO., LTD cash-generating unit is NT$38,818 thousand as of December 31, 2025. This recoverable amount has been determined based on a value in use calculation using cash flow projections from financial budgets approved by management covering a five-year period. The projected cash flows have been updated to reflect the change in demand for product. The pre-tax discount rate applied to cash flow projections is 17.59% and cash flows beyond the five-year period are extrapolated using a 2.10% growth rate. As a result of the updated analysis, management did not identify an impairment for goodwill of NT$2,159 thousand which is allocated to this cash-generating unit.

Key assumptions used in value-in-use calculations

The calculation of value-in-use for both electronics and fire prevention equipment units are most sensitive to the following assumptions:

(a) Gross margin
(b) Discount rates
(c) Growth rate used to extrapolate revenue beyond the budget period.

Gross margins – Gross margins are estimated based on the value achieved in prior year and referencing the future market trends.

Discount rates – Discount rates reflect the current market assessment of the risks specific to each cash generating unit (including the time value of money and the risks specific to the asset for which the future cash flow estimates have not been adjusted). The discount rate was estimated based on the weighted average cost of capital (WACC) for the Group, taking into account the particular situations of the Group and its operating segments. The WACC includes both the cost of liabilities and cost of equities. The cost of equities is derived from the expected returns of the Group’s investors on capital, where the cost of liabilities is measured by the interest-bearing loans that the Group has obligation to settle.

Growth rate estimates of revenue – Rates is estimated based on past experience, the long-term average growth rate has been adjusted based on the economic environment.

Sensitivity to changes in assumptions

With regard to the assessment of value-in-use of CHENG CHONG TECHNOLOGY CO., LTD, management believes that no reasonably possible change in any of the above key assumptions would cause the carrying value of the unit to materially exceed its recoverable amount.

(B) The recoverable amount of CHIANAN TECHNOLOGY CO., LTD. cash-generating unit has been determined based on a value in use calculation. The projected cash flows have been updated to reflect changes in demand for related products. The Company assessed that adverse changes have occurred in the market and other relevant factors affecting CHIANAN TECHNOLOGY CO., LTD. Based on the results of this analysis, management recognized an impairment loss of NT$37,859 thousand.

(9) Other non-current assets

Details of other non-current assets are as follows:

	As of
	Dec. 31, 2025	Dec. 31, 2024
Refundable deposits	$45,941	$21,081
Long-term prepaid expenses	19,279	6,628
Total	$65,220	$27,709

(10) Short-term loans

(A) Details of short-term loans are as follows:

	As of
	Dec. 31, 2025	Dec. 31, 2024
Unsecured bank loans	$4,121,501	$7,858,490
Secured bank loans	223,580	130,036
Total	$4,345,081	$7,988,526
Interest Rates (%)
---	---	---
Unsecured bank loans	2.10%~6.50%	2.95%~7.15%
Secured bank loans	1.40%~3.00%	1.70%~3.30%

(B) The Group’s unused short-term lines of credits amounts to NT$7,109,337 thousand and NT$4,429,980 thousand as of December 31, 2025 and 2024, respectively.

(11) Other payables

Details of other payables are as follows:

	As of
	Dec. 31, 2025	Dec. 31, 2024
Accrued expenses	$1,202,680	$1,368,923
Dividends payables	4	-
Accrued interest	29,096	18,324
Payables to equipment suppliers	1,864,753	3,705,102
Total	$3,096,533	$5,092,349

(12) Long-term loans

(A) Details of long-term loans as of December 31, 2025 and 2024 are as follows:

Lenders	As of Dec. 31, 2025	Interest Rate (%) (Note2)	Maturity and terms of repayment
Agricultural Bank of China – Kunshan Branch – Credit loans (Note1)	$2,788,943	The benchmark interest rate of the Peoples’ Bank of China for a period of over five years – LPR 0.2%	After the grace period expires, the following terms are defined as every six months since then. The principle is repayable in installments of equal amount for eight years.
Fubon Bank – Unsecured bank loans	2,162,805	LPR+45BP for one year	5% repayment of principal is made every six months from the date of each withdraw. 20% repayment in the 30th month and 60% repayment in the 36th month.

Lenders	As of Dec. 31, 2025	Interest Rate (%) (Note2)	Maturity and terms of repayment
Bank of Shanghai Co., Ltd. — Unsecured bank loans	1,106,723	Between LPR+43BP and 45BP for one year	The first installment shall be paid upon 6 months after the first withdraw, and the principal shall be repaid every 6 months. The repayment schedule is based on the total drawdown amount, 1% of the principal should be repaid in the first term to the third term, 13.5% should be repaid in the fourth term and the fifth term, and the remaining outstanding balance should be repaid in full in the sixth term.
China Everbright Bank — Unsecured bank loans	758,832	LPR+20BP for one year	The principal is to be repaid in four installments. The principle of $100,000 should be repaid in the first term to third term every 6 months, and the remaining outstanding balance should be repaid in full in the fourth term.
China Industrial Bank — Unsecured bank loans	178,864	LPR for one year	The first installment shall be paid upon 6 months after the first withdrawal, and thereafter every 6 months as a term to repay the principal. Each installment will be calculated based on the total withdrawal amount, 1% of the principal should be repaid in the first term to the third term, 13.5% of the principal should be repaid in the fourth term and the fifth term, and the remaining outstanding balance should be repaid in the sixth term.

Lenders	As of Dec. 31, 2024	Interest Rate (%) (Note2)	Maturity date and terms of repayment
Agricultural Bank of China — Kunshan Branch — Credit loans (Note1)	$2,938,878	The benchmark interest rate of the Peoples’ Bank of China for a period of over five years - LPR-0.2%	After the grace period expires, the following terms are defined as every six months since then. The principle is repayable in installments of equal amount for eight years.
Bank SinoPac Co., Ltd. — Unsecured bank loans	470,482	CNH HIBOR+100BP for six months	The first installment shall be paid upon 18 months after the first withdrawal, and thereafter every 6 months as a term, a total of 4 terms. 10% of the principal of the credit line for withdrawal should be repaid in the first term to the third term, 70% should be repaid in the fourth term.
Bank of Shanghai Co., Ltd. — Unsecured bank loans	294,162	Higher of 1MTAIFX or 3MTAIFX+80BP	The grace period is 12 months upon first usage. After the grace period expires, principal is repayable in installments of the equal amount for eight terms. Pay interest quarterly.
Less: Current portion of long-term loans	(141,343)
Non-current portion of long-term loans	$3,562,179

Note1: Please refer to Note 8 for more details regarding certain property, plant and equipment pledged for secured bank loans.

Note2: Interest rates of long-term loans are as follows:

	As of
	Dec. 31, 2025	Dec. 31, 2024
Interest rate (%)	2.8%~5.02%	3.95%~5.69%

(B) On November 22, 2022, the Group has entered into a 3-year agreement of syndicated loans in credit line of USD 60,000 thousand, with Shanghai Bank and 3 other banks for the purpose of settling the unpaid loan balance mentioned above and replenishing operating capital. The Group has repaid all of the bank loans ahead of schedule in June 2024.

On June 12, 2024, the Group has entered into a 3-year agreement of syndicated loans in credit line of CNY 340,000 thousand, with Shanghai Bank for the purpose of repaying the unpaid loan balance mentioned above and replenishing mid-term operating capital. The Group has repaid all of the bank loans ahead of schedule in August 2024.

On January 15, 2025, the Group has entered into a 3-year agreement of syndicated loans in credit line of CNY 490,000 thousand, with Fubon Bank for the purpose of paying capital expenditure. The Group has utilized the loan facility as of December 31, 2025.

On May 27, 2025, the Group has entered into a 5-year agreement of syndicated loans in credit line of USD 85,000 thousand, with SinoPac Bank and 4 other banks for the purpose of paying capital expenditure. The Group has utilized the loan facility as of December 31, 2025.

According to the above joint loan contract requirement, the Company's annual consolidated financial statements are subject to restrictions such as the debt ratio, interest coverage ratio and revenue. The Company is required to maintain specific financial ratios each year during the loan term. The Company's annual financial ratios all comply with the restrictions stipulated by the aforementioned financial ratios.

(13) Refund liabilities

	As of
	Dec. 31, 2025	Dec. 31, 2024
Refund liabilities	$416,556	$376,538

(14) Long-term deferred revenue

Government grants

	For the years ended December 31,
	2025	2024
Beginning balance	$634,997	$589,994
Received during the period	71,664	69,035
Released to the statement of comprehensive income	(54,308)	(53,540)
Exchange differences	(14,090)	29,508
Ending balance	$638,263	$634,997
	As of
	Dec. 31, 2025	Dec. 31, 2024
Non-current deferred revenue - related to assets	$638,263	$634,997

Government grants have been received for purchase of certain items of property, plant and equipment. There are no unfulfilled conditions or contingencies attached to the grants.

(15) Post-employment benefits

Defined contribution plan

The Company and its domestic subsidiaries adopt a defined contribution plan in accordance with the Labor Pension Act of the R.O.C. Under the Labor Pension Act, the Company and its domestic subsidiaries will make monthly contributions of no less than 6% of the employees' monthly wages to the employees' individual pension accounts. The Company and its domestic subsidiaries have made monthly contributions of 6% of each individual employee's salaries or wages to employees' pension accounts.

Subsidiaries located in the People's Republic of China will contribute social welfare benefits based on a certain percentage of employees' salaries or wages to the employees' individual pension accounts.

Pension benefits for employees of overseas subsidiaries and branches are provided in accordance with the local regulations.

Expenses under the defined contribution plan for the years ended December 31, 2025 and 2024 amounted to NT$1,423 thousand and NT$1,334 thousand, respectively.

Additional pension expenses recognized for the executives commissioned by the Group amounted to NT$217 thousand and NT$224 thousand, for the years ended December 31, 2025 and 2024.

(16) Equities

(A) Common stock

As of December 31, 2025 and 2024, the Company’s authorized capital were both NT$4,000,000 thousand, and the issued share capital were NT$2,835,746 thousand and NT$2,776,746 thousand, each share at par value of NT$10, divided into 283,574,584 shares and 277,674,584 shares. Each share has one voting right and a right to receive dividends.

On October 27, 2025, the Company’s board of directors meeting resolved to proceed with a cash capital increase by issuing 5,900 thousand new shares at a price of NT$105 per share. This has been approved and declared effective by the FSC with Order No. Financial-Supervisory-Securities-Corporate-1140362569. The record date for the cash capital increase was set at December 26, 2025.

(B) Capital surplus

	As of
	Dec. 31, 2025	Dec. 31, 2024
Additional paid-in capital	$1,737,057	$1,176,745
Conversion premium of convertible bonds	1,943	1,943
Treasury share transactions	34,946	34,946
Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control	1,967,343	68,088
Gain on sale of assets	155	155
Employee share option	12,392	6,528
Share options	77,687	77,687
Merger by share exchange	1,621,622	1,621,622
Total	$5,453,145	$2,987,714

According to the Company Act, the capital reserve shall not be used except for making good the deficit of the Company. When a company incurs no loss, it may distribute the capital reserves related to the income derived from the issuance of new shares at a premium or income from endowments received by the company. The distribution could be made either in cash or in the form of share dividend to its shareholders in proportion to the number of shares being held by each of them.

(a) According to the Company’s articles of association, when allocating the current year’s earnings, if any, after having paid all taxes and dues, shall first set aside 10% of said profits as legal reserve. Where such legal reserve amounts to the total paid-in capital, this provision shall not apply; the rest shall be set aside as special surplus or reversal according to laws or the regulations of the competent authority; if there is any remaining portion, the board of directors shall, along with the accumulated undistributed earnings, submit a surplus distribution proposal to the shareholders meeting for a resolution to distribute shareholder dividends. The Company may, in accordance with Articles 240 and 241 of the Company Act, authorize the board of directors to issue cash dividends and bonuses by special resolutions, and distribute in cash the above-mentioned dividends or capital reserve or/and legal reserve in compliance with the Company Act and shall report the distribution in the most recent shareholders’ meeting.

(b) Dividend policy

The Company’s dividend policy is based on the expansion of business scale, considering the Company’s capital expenditure and operating turnover needs and the degree of dilution of earnings per share to moderately distribute stock dividends or cash dividends, but cash dividends are paid at a rate not lower than the current 10% of total annual dividends.

(c) According to the Company Act, the Company shall set aside legal reserve from earnings unless where the amount of legal reserve reaches the total authorized capital. The legal reserve can be used to make good the deficit of the Company. When the Company incurs no loss, it may distribute the portion of legal reserve which exceeds 25% of the paid-in capital by issuing new shares or by cash in proportion to the number of shares being held by shareholders.

(d) Special reserve

The special surplus reserve shall be set aside at the time of the assignment of the distributable surplus, on the basis of the difference between the balance of the special surplus reserve at the time of the first IFRS application and the net amount of other equity deductions. For any subsequent use, disposal or reclassification of related assets, the company can reverse the special reserve by proportion and transfer to retained earnings.

Following the adoption of T-IFRS, the FSC on March 31, 2021 issued Order No. Financial-Supervisory-Securities-Corporate-1090150022, which sets out the following provisions for compliance: On a public company's first-time adoption of the IFRS, for any unrealized revaluation gains and cumulative translation adjustments (gains) recorded to shareholders' equity that the company elects to transfer to retained earnings by application of the exemption under IFRS 1, Dynamic Electronics (Taoyuan) shall set aside special reserve. For any subsequent use, disposal or reclassification of related assets, Dynamic Electronics (Taoyuan) can reverse the special reserve by proportion and transfer to retained earnings.

As of January 1, 2013, special reserve set aside for the first-time adoption of T-IFRS amounted to NT$349,310 thousand. Furthermore, Dynamic Electronics (Taoyuan) has reversed special reserve in the amount of NT$49,644 thousand to retained earnings during the year ended December 31, 2013 due to the use, disposal or reclassification of related assets. As of December 31, 2025 and 2024, special reserve set aside for the first-time adoption of T-IFRS reduced to NT$299,666 thousand accordingly.

(e) The appropriations of earnings for the years 2025 and 2024 were approved through the Board meeting and stockholders’ meeting held on March 6, 2026 and May 22, 2025, respectively. The details of the distributions are as follows.

	Appropriation of earnings		Dividend per share (in NT$)
	2025	2024	2025	2024
Legal reserve	$74,898	$105,074
Special reserve	-	(90,287)
Cash dividend	306,261	416,512	$1.08	$1.5
Total	$381,159	$431,299

Please refer to Note 6(21) for details on employees’ compensation and remuneration to directors and supervisors.

(D) Non-controlling interests

	For the years ended December 31,
	2025	2024
Beginning balance	$192,934	$156,899
Profit attributable to non-controlling interests	32,305	24,800
Exchange differences arising from translation of foreign operations	57,603	11,094
Cash capital increase by the subsidiary	3,473,423	-
Acquisition of new shares in a subsidiary not in proportionate to ownership interest	(1,898,152)	-
Issuance of employees share options by the subsidiary	24	141
Ending Balance	$1,858,137	$192,934

(17) Share-based payment plans

(a) Share-based payment plan for employees of the parent entity

Capital increase by cash

Certain employees of the Company are entitled to share-based payment as part of their remunerations; services are provided by the employees in return for the equity instruments granted. These plans are accounted for as equity-settled share-based payment transactions.

On October 27, 2025, the Company’s board of directors meetings resolved to proceed with a cash capital increase by issuing new shares, with a portion reserved for employee subscription. And the record date for the cash capital increase was set at December 26, 2025.

A. Information on the employee stock option plan for Cash Capital Increase is summarized as follow:

	For the years ended December 31, 2025
	Option
(in thousand)	Weighted-average
Exercise Price
per Share (NT$/Share)
Outstanding at beginning of period	-	$-
Granted	590	105.00
Exercised	(65)	105.00
Expired	(525)	105.00
Outstanding at end of period	-
Weighted-average fair value of options
granted during the period (in NT$)	$11.17

B. The Company uses the Black-Scholes evaluation model to increase the stock rights of employees with cash capital, and the parameters used in the evaluation model are as follows:

	2025.12.09
Stock market price	$116.00
Exercised price	$105.00
Expected volatility (%)	30.40%
Expected life (Years)	0.04 years
Expected dividend yield (%)	0%
Risk free interest rate (%)	1.1663%

The expected volatility is based on the Company's stock price over 14 trading days.

The expense arising from equity-settled share-based payment transactions recognized in amount of NT$6,590 thousand.

(b) Share-based payment plan for employees of the subsidiary

Dynamic Electronics Co., Ltd. (Huangshi), the subsidiary of the Group, conducted a cash capital increase for the year ended December 31, 2022, of which 8,252 thousand shares are held by the platform of employee stock ownership in accordance with the Employee Stock Ownership Management Measures of Dynamic Electronics Co., Ltd. (Huangshi). For the year ended December 31, 2025 and 2024, the number of shares transferred by employees of the shareholding platform were 57 thousand and 328 thousand shares, and the expenses recognized were NT$1,127 thousand and NT$6,559 thousand.

(18) Operating revenues

	For the years ended December 31,
	2025	2024
Revenue from contracts with customers
Sale of goods	$19,445,963	$17,782,187
Operating revenues	6,998	4,817
Total	$19,452,961	$17,787,004

Analysis of revenue from contracts with customers for the years ended December 31, 2025 and 2024 are as follows:

(A) Disaggregation of revenue

For the year ended December 31, 2025

	PCB Segment	Mock-up Segment	Total
Sales of goods	$19,379,345	$66,618	$19,445,963
Other	6,998	-	6,998
Total	$19,386,343	$66,618	$19,452,961

The timing for revenue recognition:

At a point in time $19,386,343 $66,618 $19,452,961

For the year ended December 31, 2024

	PCB Segment	Mock-up Segment	Total
Sales of goods	$17,729,345	$52,842	$17,782,187
Others	4,817	-	4,817
Total	$17,734,162	$52,842	$17,787,004

The timing for revenue recognition:

At a point in time $17,734,162 $52,842 $17,787,004

(B) Contract balances

(a) Contract liabilities - current

	As of
	Dec. 31, 2025	Dec. 31, 2024
Sales of goods	$2,234	$850

The significant changes in the Group's balances of contract liabilities for the year ended December 31, 2025 are as follows:

	Sales of goods
The opening balance transferred to revenue	$(850)
Increase in receipts in advance during the period (excluding the amount incurred and transferred to revenue during the period)	2,234

The significant changes in the Group's balances of contract liabilities for the year ended December 31, 2024 are as follows:

	Sales of goods
The opening balance transferred to revenue	$(23,132)
Increase in receipts in advance during the period (excluding the amount incurred and transferred to revenue during the period)	850

(19) Expected credit losses (gains)

	For the years ended December 31,
	2025	2024
Operating expenses – Expected credit losses (gains)
Accounts receivable	$(3,593)	$(349)

Please refer to Note 12 for more details on credit risk.

The Group measures the loss allowance of its trade receivables (including notes receivable and accounts receivable) at an amount equal to lifetime expected credit losses. The assessment of the Group’s loss allowance as of December 31, 2025 and 2024 are as follow:

(A) The historical credit loss experience for trade receivables shows that different customer segments do not have significantly different loss patterns. Therefore, the loss allowance of trade receivables is measured at an amount equal to lifetime expected credit losses and with no distinction between groups, details are as follows:

As of December 31, 2025

| | Not yet due
(Note) | Past due | | | | | Total |
| --- | --- | --- | --- | --- | --- | --- | --- |
| | | <=30 days | 31-60 days | 61-90 days | 91-120 days | >=121 days | |
| Gross carrying amount | $6,750,591 | $99,362 | $3,666 | $982 | $1 | $630 | $6,855,232 |
| Loss ratio | -% | 10% | 100% | 100% | 100% | 100% | |
| Lifetime expected credit losses | - | (9,936) | (3,666) | (982) | (1) | (630) | (15,215) |
| Carrying amount of trade receivables | $6,750,591 | $89,426 | $- | $- | $- | $- | $6,840,017 |

As of December 31, 2024

| | Not yet due
(Note) | Past due | | | | | Total |
| --- | --- | --- | --- | --- | --- | --- | --- |
| | | <=30 days | 31-60 days | 61-90 days | 91-120 days | >=121 days | |
| Gross carrying amount | $5,519,546 | $145,821 | $9,124 | $3,803 | $716 | $1,549 | $5,680,559 |
| Loss ratio | -% | 3% | 100% | 100% | 100% | 100% | |
| Lifetime expected credit losses | - | (4,278) | (9,124) | (3,803) | (716) | (1,549) | (19,470) |
| Carrying amount of trade receivables | $5,519,546 | $141,543 | $- | $- | $- | $- | $5,661,089 |

Note: All the Group’s notes receivables were not past due.

(B) The movement in the provision for impairment of note receivable and accounts receivable for the years ended December 31, 2025 and 2024 are as follows:

	Notes receivable	Accounts receivable
Beginning balance as of January 1, 2025	$-	$19,470
Addition/(reversal) for the current period	-	(3,593)
Write-off as unrecoverable	-	-
Effect of exchange rate changes	-	(662)
Ending balance as of December 31, 2025	$-	$15,215
Beginning balance as of January 1, 2024	$-	$18,634
Addition/(reversal) for the current period	-	(349)
Write-off as unrecoverable	-	-
Effect of exchange rate changes	-	1,185
Ending balance as of December 31, 2024	$-	$19,470

(20) Leases

(A) Group as a lessee

The Group leases various properties, including real estate such as land and buildings, machinery and equipment and transportation equipment. The lease terms range from 2 to 50 years. The Group is not allowed to loan, sublease or sell without obtaining the consent from the lessors.

The Group’s leases effect on the financial position, financial performance and cash flows are as follow:

(a) Amounts recognized in the balance sheet

a. Right-of-use assets

The carrying amount of right-of-use assets

	Land	Buildings	Machinery and equipment	Transportation equipment	Total
Cost:
As of January 1, 2025	$473,563	$1,226	$4,730	$6,992	$486,511
Additions	-	-	-	-	-
Disposals	-	-	-	-	-
Exchange differences	(9,263)	(24)	(93)	(23)	(9,403)
As of December 31, 2025	$464,300	$1,202	$4,637	$6,969	$477,108
Cost:
As of January 1, 2024	$450,137	$1,158	$4,496	$7,138	$462,929
Additions	-	1,226	-	5,854	7,080
Disposals	-	(1,218)	-	(6,056)	(7,274)
Exchange differences	23,426	60	234	56	23,776
As of December 31, 2024	$473,563	$1,226	$4,730	$6,992	$486,511
Depreciation and impairment:
As of January 1, 2025	$80,763	$306	$4,730	$2,331	$88,130
Depreciation	9,009	583	-	2,168	11,760
Disposals	-	-	-	-	-
Exchange differences	(1,303)	12	(93)	(1)	(1,385)
As of December 31, 2025	$88,469	$901	$4,637	$4,498	$98,505

	Land	Buildings	Machinery and equipment	Transportation equipment	Total
Depreciation and impairment:
As of January 1, 2024	$67,765	$868	$3,372	$6,201	$78,206
Depreciation	9,264	597	1,157	2,174	13,192
Disposals	-	(1,218)	-	(6,056)	(7,274)
Exchange differences	3,734	59	201	12	4,006
As of December 31, 2024	$80,763	$306	$4,730	$2,331	$88,130
Net carrying amount as at:
December 31, 2025	$375,831	$301	$-	$2,471	$378,603
December 31, 2024	$392,800	$920	$-	$4,661	$398,381

Please refer to Note 8 for more details on right-of-use assets under pledge.

b. Lease liabilities

	As of
	Dec. 31, 2025	Dec. 31, 2024
Lease liabilities	$2,759	$5,495
Current	$2,443	$2,719
Non-current	316	2,776
Total	$2,759	$5,495

Please refer to Note 6(22)(D) for the interest on lease liabilities recognized during the years ended December 31, 2025 and 2024 refer to Note12(5) Liquidity Risk Management for the maturity analysis for lease liabilities as of December 31, 2025 and 2024.

(b) Income and costs relating to leasing activities

	For the years ended December 31,
	2025	2024
The expenses relating to short-term leases	$68,680	$82,450

As of December 31, 2025 and 2024, the portfolio of short-term leases of the Group to which it is committed at the end of the reporting period is dissimilar to the portfolio of short-term leases to which the short-term lease expense disclosed above and the amount of its lease commitments is NT$0.

For the years ended December 31, 2025 and 2024, the Group’s total cash outflows for leases amounting to NT$71,435 thousand and NT$86,610 thousand, respectively.

(21) Summary of employee benefits, depreciation and amortization expenses by function is as follows:

| Function
Nature | For the years ended December 31, | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| | 2025 | | | 2024 | | |
| | Operating costs | Operating expenses | Total amount | Operating costs | Operating expenses | Total amount |
| Employee benefits expense | | | | | | |
| Salaries | $1,806,318 | $1,226,764 | $3,033,082 | $1,642,865 | $1,192,476 | $2,835,341 |
| Labor and health insurance | 1,607 | 2,430 | 4,037 | 1,354 | 2,150 | 3,504 |
| Pension | 313 | 1,327 | 1,640 | 259 | 1,299 | 1,558 |
| Other employee benefits | 214 | 1,535 | 1,749 | 236 | 1,119 | 1,355 |
| Depreciation | 1,410,357 | 245,740 | 1,656,097 | 1,088,108 | 159,299 | 1,247,407 |
| Amortization | 2,413 | 23,366 | 25,779 | 2,267 | 15,821 | 18,088 |

According to the Articles of Incorporation approved through the shareholders' meeting held on May 22, 2025, if there is profit in the year, no less than 0.1% shall be allocated as employee compensation (of the aforementioned employee remuneration amount, no less than 1% shall be set aside as remuneration for entry-level employees) and no more than 3% as director remuneration. However, when there are accumulated losses, the profit shall be used to cover the losses first. The Company may, by a resolution adopted by a majority vote at a meeting of Board of Directors attended by two-thirds of the total number of directors, have the profit distributable as employees' compensation in the form of shares or in cash; and in addition thereto, a report of such distribution is submitted to the shareholders' meeting. Information on the Board of Directors' resolution regarding the employees' compensation and remuneration to directors and supervisors can be obtained from the "Market Observation Post System" on the website of the TWSE.

Based on profit of the years ended December 31, 2025 and 2024, the Company estimated the amounts of the employees' compensation and remuneration to directors and supervisors for the years ended December 31, 2025 and 2024 to be not lower than 0.1% and not higher than 3% of profit of the current year, respectively, recognized as employee benefits expense. As such, employees' compensation and remuneration to directors and supervisors for the year ended December 31, 2025 amounted to NT$6,264 thousand and NT$11,973 thousand, respectively; for the year ended December 31, 2024 amounted to NT$6,862 thousand and NT$16,455 thousand, respectively. A resolution was passed at a board meeting to distribute in the form of stocks as employees' compensation; the number of stocks distributed was calculated based on the closing price one day before the date of resolution. If there is a discrepancy between the estimated number and the actual distribution amount determined by the board of directors, it will be recognized as a gain or loss in the following year.

No material differences existed between the actual distribution amount of the employee compensation and remuneration to directors and supervisors and the amount expensed in the financial statements for the year ended December 31, 2025.

No material differences exist between the actual distribution amount of the employee compensation and remuneration to directors and supervisors and the amount expensed in the financial statements for the year ended December 31, 2024.

(22) Non-operating income and expenses

(A) Interest income

	For the years ended December 31,
	2025	2024
Interest income
Financial assets measured at amortized cost	$15,267	$37,095

(B) Other income

	For the years ended December 31,
	2025	2024
Other income—others	$77,255	$105,985
Other income—gain on government grants	159,151	144,143
Total	$236,406	$250,128

	For the years ended December 31,
	2025	2024
Gain (loss) on disposal of property, plant and equipment	$4,864	$(2,455)
Foreign exchange (loss) gain, net	228,551	266,002
Gain (loss) on financial assets and liabilities at fair value through profit or loss	-	(823)
Impairment loss	(5,061)	(21,565)
Other losses—others	(15,347)	(32,594)
Total	$213,007	$208,565

(D) Finance costs

	For the years ended December 31,
	2025	2024
Interest on bank loans	$564,025	$465,275
Interest on lease liabilities	77	121
Total	$564,102	$465,396

(23) Components of other comprehensive income (loss)

For the year ended December 31, 2025

	Arising during the period	Reclassification during the period	Subtotal	Income tax benefit (expense)	OCI, Net of tax
May be reclassified to profit or loss in subsequent periods: Exchange differences arising on translation of foreign operations	$118,693	$-	$118,693	$-	$118,693

For the year ended December 31, 2024

	Arising during the period	Reclassification during the period	Subtotal	Income tax benefit (expense)	OCI, Net of tax
May be reclassified to profit or loss in subsequent periods: Exchange differences arising on translation of foreign operations	$507,487	$-	$507,487	$-	$507,487

(24) Income tax

(A) The major components of income tax expense (income) are as follows:

Income tax expense (income) recognized in profit or loss

	For the years ended December 31,
	2025	2024
Current income tax expense (income):
Current income tax charge	$161,952	$183,354
Adjustments in respect of current income tax of prior periods	1,615	3,839
Deferred tax expense (income):
Deferred tax expense (income) relating to origination and reversal of temporary differences	115,565	304,856
Total income tax expense	$279,132	$492,049

(B) A reconciliation between income tax expense and income before tax at the Company's applicable tax rates is as follows:

	For the years ended December 31,
	2025	2024
Income before tax	$1,060,418	$1,567,588
Tax at the domestic rates applicable to profits in the country carcered	$566,789	$743,978
Other adjustments according to the Tax Law	(435,871)	(244,963)
Tax on undistributed earnings	31,034	21,312
Tax effect of deferred tax assets/liabilities	115,565	(32,117)
Adjustments in respect of current income tax of prior periods	1,615	3,839
Total income tax expense recognized in profit or loss	$279,132	$492,049

	Beginning balance as of January 1, 2025	Recognized in profit or loss	Exchange adjustment	Ending balance as of December 31, 2025
Temporary differences
Bad debts loss	$1,122	$(71)	$(24)	$1,027
Unrealized loss on inventory valuation	9,244	4,424	(45)	13,623
Investments accounted for using the equity method	(974,119)	(229,169)	2,339	(1,200,949)
Unrealized exchange loss (gain)	(337)	293	-	(44)
Sales returns and allowances	1,667	-	-	1,667
Loss carryforwards	-	106,754	3,281	110,035
Gain on government grants	95,158	2,204	(1,794)	95,568
Deferred tax income (expense)		(115,565)	3,757
Net deferred tax assets (liabilities)	$(867,265)			$(979,073)
Reflected in balance sheet as follows:
Deferred tax assets	$107,191			$221,920
Deferred tax liabilities	$(974,456)			$(1,200,993)

	Beginning balance as of January 1, 2024	Recognized in profit or loss	Exchange adjustment	Ending balance as of December 31, 2024
Temporary differences
Bad debts loss	$54	$1,042	$26	$1,122
Unrealized loss on inventory valuation	8,349	450	445	9,244
Investments accounted for using the equity method	(664,756)	(302,921)	(6,442)	(974,119)
Unrealized exchange loss (gain)	-	(337)	-	(337)
Sales returns and allowances	6,771	(5,104)	-	1,667
Gain on government grants	88,493	2,014	4,651	95,158
Deferred tax income (expense)		$(304,856)	$(1,320)
Net deferred tax assets (liabilities)	$(561,089)			$(867,265)
Reflected in balance sheet as follows:
Deferred tax assets	$103,667			$107,191
Deferred tax liabilities	$(664,756)			$(974,456)

(D) Unrecognized deferred tax assets

As of December 31, 2025 and 2024, deferred tax assets that have not been recognized amounted to NT$230,239 thousand and NT$187,443 thousand, respectively.

(E) As of December 31, 2025, the Company’s unused net operating loss carryforwards and expiration periods are as follows:

Year incurred	Unused net operating loss	Expiration year
2022	$22,202	2032
2025 (proposed)	79,042	2035
Total	$101,244

As of December 31, 2025, the Group’s Taiwan subsidiaries’ unused net operating loss carryforwards and expiration periods are as follows:

Year incurred	Unused net operating loss	Expiration year
2018	$52,504	2028
2019	198,948	2029
2023	7,566	2033
2024	36,998	2034
2025 (proposed)	3,021	2035
Total	$299,037

As of December 31, 2025, the Group’s China subsidiaries’ unused net operating loss carryforwards and expiration periods are as follows:

Year incurred	Unused net operating loss	Expiration year
2018	$82,614	2028
2020	300,624	2030
2021	163,367	2031
2022	271,591	2032
2023	125,166	2033
Total	$943,362

(F) The assessment of income tax returns

As of December 31, 2025, the assessment status of income tax returns of the Company and subsidiaries are as follows:

	The assessment of income tax returns
The Company	Assessed and approved up to 2023
Subsidiary - Dynamic Electronics
(Taoyuan) Co., Ltd.	Assessed and approved up to 2023
Subsidiary - CHIANAN TECHNOLOGY
CO., LTD.	Assessed and approved up to 2023
Subsidiary - CHENG CHONG
TECHNOLOGY CO., LTD.	Assessed and approved up to 2023

(25) Earnings per share

Basic earnings per share are calculated by dividing net profit for the year attributable to ordinary equity holders of the parent entity by the weighted average number of ordinary shares outstanding during the year.

Diluted earnings per share are calculated by dividing the net profit attributable to ordinary equity holders of the parent entity (after adjusting any influences) by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.

	For the years ended December 31,
	2025	2024
(A) Basic earnings per share
Net income available to common shareholders of the parent (in thousand NT$)	$748,981	$1,050,739
Weighted average number of common stocks outstanding (in thousand shares)	277,772	277,675
Basic earnings per share (in NT$)	$2.70	$3.78
(B) Diluted earnings per share
Net income available to common shareholders of the parent (in thousand NT$)	$748,981	$1,050,739
Net income available to common shareholders of the parent after dilution (in thousand NT$)	$748,981	$1,050,739

	For the years ended December 31,
	2025	2024
Weighted average number of common stocks outstanding (in thousand shares)	277,772	277,675
Effect of dilution:
Employee bonus (compensation) - stock (in thousand shares)	71	130
Weighted average number of common stocks outstanding after dilution (in thousand shares)	277,843	277,805
Diluted earnings per share (in NT$)	$2.70	$3.78

There were no other transactions involving ordinary shares or potential ordinary shares between the reporting date and the date the financial statements were authorized for issue.

(26) The changes of the ownership interests in subsidiaries

Did not subscribe to the new shares issued by the subsidiary in proportion to shareholding

Dynamic Electronics Co., Ltd. (Huangshi) issued new shares in a capital increase on October 15, 2025. The Group did not subscribe according to its shareholding ratio, resulting in its ownership decreasing to 86.0989%. The cash amount the Group received was from the capital increase NT$3,473,423 thousand. The carrying amount of Dynamic Electronics Co., Ltd. (Huangshi)'s net assets was NT$9,293,179 thousand. The related decrease in Group's equity in Dynamic Electronics Co., Ltd. (Huangshi) includes the increase in non-controlling interests:

Additional cash received from the offerings	$3,473,423
Increase to non-controlling interests	(1,575,271)
Difference recognized in capital surplus within equity	$1,898,152

(27) Subsidiary that has material non-controlling interests

Financial information of subsidiary that has material non-controlling interests is as below:

Proportion of equity interest held by non-controlling interests:

Name	Country	As of December 31,
		2025	2024
Dynamic Electronics Co., Ltd. (Huangshi)	China	13.9011%	2.1459%
		As of December 31,
		2025	2024
Accumulated balances of material non-controlling interest:
Dynamic Electronics Co., Ltd. (Huangshi)		$1,848,945	$184,725
		For the year ended December 31,
		2025	2024
Profit/(loss) allocated to material non-controlling interest:
Dynamic Electronics Co., Ltd. (Huangshi)		$31,322	$25,666

The summarized financial information of this subsidiary is provided below. This information is based on amounts before inter-company eliminations.

Dynamic Electronics Co., Ltd. (Huangshi) summarized information of profit or loss for the years ended December 31, 2025 and 2024 were as follows:

	For the year ended December 31,
	2025	2024
Operating revenue	$15,311,888	$13,876,717
Profit/loss from continuing operation	1,132,729	1,222,765
Total comprehensive income	1,268,240	1,354,413

Dynamic Electronics Co., Ltd. (Huangshi) summarized information of financial position is as follows:

	As of December 31,
	2025	2024
Current assets	$9,549,817	$6,813,366
Non-current assets	19,498,924	17,959,398
Current liabilities	8,264,084	12,497,439
Non-current liabilities	7,483,947	3,667,050

Dynamic Electronics Co., Ltd. (Huangshi) summarized cash flow information is as follows:

	For the year ended December 31,
	2025	2024
Operating activities	$1,064,126	$2,034,279
Investing activities	(2,986,478)	(4,273,905)
Financing activities	3,500,229	2,064,508
Net increase/(decrease) in cash and cash equivalents	1,577,877	(175,118)

7. Related party transactions

Significant transactions with related parties

Key management personnel compensation

	For the years ended December 31,
	2025	2024
Short-term employee benefits	$40,519	$64,717
Post-employment benefits	498	530
Total	$41,017	$65,247

8. Assets pledged as collateral

As of December 31, 2025 and 2024, the assets pledged for the Group’s loans are as follows:

Item	Book value	Purpose of pledge
As of December 31, 2025
Financial assets measured at amortized cost	$44,716	Secured loans
Property, plant and equipment – Land	356,840	Secured loans
Property, plant and equipment – Buildings	6,244,257	Secured loans
Property, plant and equipment – Machinery and equipment	595,208	Secured loans
Property, plant and equipment – Other equipment	1,409	Secured loans
Right-of-use assets	351,923	Secured loans
Total	$7,594,353
As of December 31, 2024
Property, plant and equipment – Buildings	$2,724,099	Secured loans
Property, plant and equipment – Machinery and equipment	776,859	Secured loans
Property, plant and equipment – Other equipment	1,437	Secured loans
Right-of-use assets	367,487	Secured loans
Notes receivable	130,036	Secured loans
Total	$3,999,918

9. Significant contingencies and unrecognized contract commitments

(1) As of December 31, 2025, the Group’s outstanding contracts relating to purchased property, plant and equipment are as follows:

Type of Asset	Total Amount	Amount paid	Amount unpaid
Machinery and construction contracts	$3,309,730	$1,799,819	$1,509,911

Amount paid was recorded under construction in progress and equipment to be examined.

Losses due to major disasters

None.

Significant subsequent events

None.

Others

(1) Categories of financial instruments

Financial assets

	As of
	Dec. 31, 2025	Dec. 31, 2024
Financial assets measured at amortized cost:
Cash and cash equivalents (excluding cash on hand)	$5,524,702	$2,847,685
Financial assets measured at amortized cost	44,716	-
Notes receivable	478,967	408,424
Accounts receivable	6,361,050	5,252,665
Other receivables	167,105	171,451
Refundable deposits	45,941	21,081
Total	$12,622,481	$8,701,306

Financial liabilities

	As of
	Dec. 31, 2025	Dec. 31, 2024
Financial liabilities measured at amortized cost:
Short-term loans	$4,345,081	$7,988,526
Payables	7,460,209	8,944,882
Leased liabilities (including current portion with maturity less than 1 year)	2,759	5,495
Long-term loans (including current portion with maturity less than 1 year)	11,681,674	3,703,522
Total	$23,489,723	$20,642,425

(2) Financial risk management objectives and policies

The Group’s principal financial risk management objective is to manage the market risk, credit risk and liquidity risk related to its operating activates. The Group identifies measures and manages the aforementioned risks based on the Group’s policy and risk appetite.

The Group has established appropriate policies, procedures and internal controls for financial risk management. Before the Group enters into significant transactions, the Board of Directors and Audit Committee must carry out due approval process based on related protocols and internal control procedures. The Group complies with its financial risk management policies at all times.

(3) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of the changes in market prices. Market prices comprise currency risk, interest rate risk and other price risk (such as equity risk).

In practice, it is rarely the case that a single risk variable will change independently from other risk variables. There are usually interdependencies between risk variables. However, the sensitivity analysis disclosed below does not take into account the interdependencies between risk variables.

Foreign currency risk

The Group’s exposure to the risk of changes in foreign exchange rates relates primarily to the Group’s operating activities (when revenue or expense are denominated in a different currency from the Group’s functional currency) and the Group’s net investments in foreign subsidiaries.

The Group has certain foreign currency receivables to be denominated in the same foreign currency with certain foreign currency payables, therefore natural hedge is received. The Group also uses forward contracts to hedge the foreign currency risk on certain items denominated in foreign currencies. Hedge accounting is not applied as they did not qualify for hedge accounting criteria. Furthermore, as net investments in foreign subsidiaries are for strategic purposes, they are not hedged by the Group.

The foreign currency sensitivity analysis of the possible change in foreign exchange rates on the Group's profit is performed on significant monetary items denominated in foreign currencies as of the end of the reporting period. The Group's foreign currency risk is mainly related to the volatility in the exchange rates for foreign currency. The information of the sensitivity analysis is as follows:

When NTD strengthens/weakens against USD by 1%, the profit for the years ended December 31, 2025 and 2024 is decreased/increased by NT$45,029 thousand and NT$38,245 thousand, respectively.

When NTD strengthens/weakens against RMB by 1%, the profit for the years ended December 31, 2025 and 2024 is increased/decreased by NT$147,792 thousand and NT$145,788 thousand, respectively.

When NTD strengthens/weakens against THB by 1%, the profit for the years ended December 31, 2025 and 2024 is increased/decreased by NT$10,490 thousand and NT$15,915 thousand, respectively.

Interest rate risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Group's exposure to the risk of changes in market interest rates relates primarily to the Group's loans and receivables at variable interest rates, bank borrowings with fixed interest rates and variable interest rates.

The interest rate sensitivity analysis is performed on items exposed to interest rate risk as at the end of the reporting period, including investments and borrowings with variable interest rates and interest rate swaps. At the reporting date, a change of 0.1% of interest rate in a reporting period could cause the profit for the years ended December 31, 2025 and 2024 to decrease/increase by NT$10,582 thousand and NT$8,924 thousand, respectively.

Equity price risk

As of December 31, 2025 and 2024, the Group does not hold equity securities at fair value; therefore the Group is not subject to equity price risk.

(4) Credit risk management

Credit risk is the risk that counterparty will not meet its obligations under a contract, leading to a financial loss. The Group is exposed to credit risk from operating activities (primarily for accounts receivables and notes receivables) and from its financing activities, including bank deposits and other financial instruments.

Credit risk is managed by each business unit subject to the Group’s established policy, procedures and control relating to credit risk management. Credit limits are established for all counter parties based on their financial position, rating from credit rating agencies, historical experience, prevailing economic condition and the Group’s internal rating criteria etc. Certain counter parties’ credit risk will also be managed by taking credit enhancing procedures, such as requesting for prepayment or insurance.

As of December 31, 2025 and 2024, accounts receivable from top ten customers represent 54.27% and 62.81% of the total accounts receivables of the Group, respectively. The credit concentration risk of other accounts receivables is insignificant.

Credit risk from balances with banks, fixed income securities and other financial instruments is managed by the Group’s treasury in accordance with the Group’s policy. The Group only transacts with counterparties approved by the internal control procedures, which are banks and financial institutions, companies and government entities with good credit rating. Consequently, there is no significant credit risk for these counter parties.

The Group adopted IFRS 9 to assess the expected credit losses. Except for the loss allowance of trade receivables is measured at lifetime expected credit losses, the remaining debt instrument investments which are not measured at fair value through profit or loss, low credit risk for these investments is a prerequisite upon acquisition and by using their credit risk as a basis for the distinction of categories.

Financial assets are written off when there is no realistic prospect of future recovery (the issuer or the debtor is in financial difficulties or bankruptcy).

(5) Liquidity risk management

The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of cash and cash equivalents, bank borrowings and finance leases. The table below summarizes the maturity profile of the Group’s financial liabilities based on the contractual undiscounted payments and contractual maturity. The payment amount includes the contractual interest. The undiscounted payment relating to borrowings with variable interest rates is extrapolated based on the estimated interest rate yield curve as of the end of the reporting period.

Non-derivative financial liabilities

	< 1 year	2 to 3 years	4 to 5 years	> 5 years	Total
As of Dec. 31, 2025
Loans	$6,032,522	$7,810,543	$3,373,702	$-	$17,216,767
Payables	7,460,209	-	-	-	7,460,209
Lease liabilities	2,494	249	81	-	2,824
As of Dec. 31, 2024
Loans	$8,406,447	$1,836,751	$1,768,897	$342,062	$12,354,157
Payables	8,944,882	-	-	-	8,944,882
Lease liabilities	2,751	2,698	203	-	5,652

(6) Reconciliation of liabilities arising from financing activities

Reconciliation of liabilities for the year ended December 31, 2025:

	Short-term loans	Long-term loans	Refundable deposits	Lease liabilities	Total liabilities from financing activities
As of January 1, 2025	$7,988,526	$3,703,522	$76,272	$5,495	$11,773,815
Cash flows	(3,643,445)	8,004,179	16,912	(2,755)	4,374,891
Non-cash changes
Interest expense	-	-	-	77	77
Foreign exchange movement	-	(26,027)	-	(58)	(26,085)
As of December 31, 2025	$4,345,081	$11,681,674	$93,184	$2,759	$16,122,698

Reconciliation of liabilities for the year ended December 31, 2024:

	Short-term loans	Long-term loans	Refundable deposits	Lease liabilities	Total liabilities from financing activities
As of January 1, 2024	$3,906,953	$4,349,069	$141,437	$2,574	$8,400,033
Cash flows	4,081,573	(871,880)	(65,165)	(4,160)	3,140,368
Non-cash changes
Lease modification	-	-	-	6,875	6,875
Interest expense	-	-	-	121	121
Foreign exchange movement	-	226,333	-	85	226,418
As of December 31, 2024	$7,988,526	$3,703,522	$76,272	$5,495	$11,773,815

(7) Fair values of financial instruments

(A) The methods and assumptions applied in determining the fair value of financial instruments:

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following methods and assumptions were used by the Group to measure or disclose the fair values of financial assets and financial liabilities:

(a) The carrying amount of cash and cash equivalents, accounts receivables, accounts payable and other current liabilities approximate their fair value due to their short maturities.

(b) For financial assets and liabilities traded in an active market with standard terms and conditions, their fair value is determined based on market quotation price (including listed equity securities, beneficiary certificates, bonds and futures etc.) at the reporting date.

(c) Fair value of equity instruments without market quotations (including private placement of listed equity securities, unquoted public company and private company equity securities) are estimated using the market method valuation techniques based on parameters such as prices based on market transactions of equity instruments of identical or comparable entities and other relevant information (for example, inputs such as discount for lack of marketability, P/E ratio of similar entities and Price-Book ratio of similar entities)

(d) Fair value of debt instruments without market quotations, bank loans, bonds payable and other non-current liabilities are determined based on the counterparty prices or valuation method. The valuation method uses DCF method as a basis, and the assumptions such as the interest rate and discount rate are primarily based on relevant information of similar instrument (such as yield curves published by the Taipei Exchange, average prices for Fixed Rate Commercial Paper published by Reuters and credit risk, etc.)

(e) The fair value of derivatives which are not options and without market quotations, is determined based on the counterparty prices or discounted cash flow analysis using interest rate yield curve for the contract period. Fair value of option-based derivative financial instruments is obtained using on the counterparty prices or appropriate option pricing model (for example, Black-Scholes model) or other valuation method (for example, Monte Carlo Simulation).

(B) Fair value of financial instruments measured at amortized cost

The carrying amount of the Group’s financial assets and liabilities measured at amortized cost approximate their fair value.

Please refer to Note 12(9) for fair value measurement hierarchy for financial instruments of the Group.

100

(8) Fair value measurement hierarchy

(A) Fair value measurement hierarchy

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, based on the lowest level input that is significant to the fair value measurement as a whole. Level 1, 2 and 3 inputs are described as follows:

Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3 – Unobservable inputs for the asset or liability.

For assets and liabilities that are recognized in the financial statements on a recurring basis, the Group determines whether transfers have occurred between Levels in the hierarchy by re-assessing categorization at the end of each reporting period.

(B) Fair value measurement hierarchy of the Group’s assets and liabilities

The Group does not have assets that are measured at fair value on a recurring basis and non-recurring basis of December 31, 2025 and 2024, respectively.

(9) Significant assets and liabilities denominated in foreign currencies (in thousand dollars)

Information regarding the significant assets and liabilities denominated in foreign currencies is as follows (in thousand dollars):

	As of
	December 31, 2025			December 31, 2024
	Foreign currencies	Foreign exchange rate	NTD	Foreign currencies	Foreign exchange rate	NTD
Financial assets
Monetary items:
USD	$202,443	31.43	$6,362,791	$152,567	32.78	$5,000,776
RMB	$1,146,642	4.47	$5,127,333	$693,982	4.56	$3,164,387
THB	$95,727	1.00	$95,909	$248,510	0.96	$239,142
Financial liabilities:
Monetary items:
USD	$59,170	31.43	$1,859,882	$35,919	32.75	$1,176,270
RMB	$4,451,762	4.47	$19,906,516	$3,897,536	4.56	$17,743,142
THB	$1,142,747	1.00	$1,144,913	$1,902,372	0.96	$1,830,662

The above information is disclosed based on the carrying amount of foreign currency (after conversion to functional currency).

Since there were varieties of foreign currency transactions of the Group, the Group was unable to disclose foreign exchange gain (loss) towards each foreign currency with significant impact. The Group recognized exchange gain (loss) amounted to NT$228,551 thousand and NT$266,002 thousand for the years ended December 31, 2025 and 2024, respectively.

(10) Capital management

The primary objective of the Group’s capital management is to ensure that it maintains a strong credit rating and healthy capital ratios in order to support its business and maximize shareholder value. The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust dividend payment to shareholders, return capital to shareholders or issue new shares.

Other disclosures

(1) Information on significant transactions:

(A) Financing provided to others: None.

(B) Endorsement/Guarantee provided to others: Please refer to Attachment 1.

(C) Marketable securities held as of December 31, 2025 (excluding investments in subsidiaries, associates and joint ventures): None.

(D) Related party transactions with purchases and sales amounts of at least NT$100 million or 20 percent of the paid-in capital for the year ended December 31, 2025: None.

(E) Receivables from related parties of at least NT$100 million or 20 percent of the paid-in capital as of December 31, 2025: None.

(F) Inter Group relationships and significant inter Group transactions for the year ended December 31, 2025: Please refer to Attachment 6.

(2) Information on investees:

(A) Name, locations and related information of investees (excluding investees in Mainland China): Please refer to Attachment 2.

(B) Investees over which the Company exercises control shall be disclosed of information under Note 13(1):

(a) Financing provided to others: Please refer to Attachment 3.

(b) Endorsement/Guarantee provided to others: Attachment 1.

(c) Marketable securities held as of December 31, 2025 (excluding investments in subsidiaries, associates and joint ventures): None.

(d) Related party transactions with purchases and sales amounts of at least NT$100 million or 20 percent of the paid-in capital for the year ended December 31, 2025: Please refer to Attachment 4.

(e) Receivables from related parties of at least NT$100 million or 20 percent of the paid-in capital as of December 31, 2025: Please refer to Attachment 5.

104

(3) Information on investments in Mainland China:

(A) Investee company name, main businesses and products, total amount of capital, method of investment, accumulated inflow and outflow of investments from Taiwan, net income (loss) of investee company, percentage of ownership, investment income (loss), carrying value of investments, cumulated inward remittance of earnings and limits on investment in Mainland China:

Investee company	Main Businesses and Products	Total Amount of Paid-in Capital	Method of Investment	Accumulated Outflow of Investment from Taiwan as of Jan. 1, 2025	Investment Flow		Accumulated Outflow of Investment from Taiwan as of Dec. 31, 2025	Net income (loss) of investee company	Percentage of Ownership	Investment income (loss) recognized	Carrying Value as of Dec. 31, 2025	Accumulated Inward Remittance of Earnings as of Dec. 31, 2025	Accumulated Outflow of Investment from Taiwan as of Dec. 31, 2025	Investment Amounts Authorized by Investment Commission, MOEA	Upper Limit on Investment
					Outflow	Inflow
Dynamic Electronics (Kunshan) Co., Ltd.	Manufacturing and selling of PCB	$2,514,400 (Note 2, 3)	(Note 11)	$2,260,265	$-	$-	$2,260,265	$173,219 (Note 2)	86.0989%	$176,873 (Note 2, 4, 5 and 12)	$3,126,047 (Note 2, 4 and 12)	$1,895,418 (Note 2)	$2,260,265	$- (Note 11)	$6,483,236

Investee company	Main Businesses and Products	Total Amount of Paid-in Capital	Method of Investment	Accumulated Outflow of Investment from Taiwan as of Jan. 1, 2025	Investment Flow		Accumulated Outflow of Investment from Taiwan as of Dec. 31, 2025	Net income (loss) of investee company	Percentage of Ownership	Investment income (loss) recognized	Carrying Value as of Dec. 31, 2025	Accumulated Inward Remittance of Earnings as of Dec. 31, 2025	Accumulated Outflow of Investment from Taiwan as of Dec. 31, 2025	Investment Amounts Authorized by Investment Commission, MOEA	Upper Limit on Investment
					Outflow	Inflow
Dynamic Electronics Co., Ltd. (Huangshi)	Manufacturing and selling of PCB	$2,063,442 (Note 2, 6,7, 8,9 and 10)	(Note 1)	$504,167	$-	$-	$504,167	$1,132,729 (Note 2)	86.0989%	$822,463 (Note 2, 4, 5 and 12)	$11,451,765 (Note 2, 4 and 12)	$-	$504,167	$3,397,582	$6,483,236

Note 1: Investment in Mainland China through WINTEK (MAURITIUS) CO., LTD. and Dynamic Holding Pte. Ltd., companies established in the third area.

Note 2: Foreign currencies were converted into New Taiwan dollars based on exchanged rate of balance sheet date.

Note 3: Total amount of paid-in capital is USD 80,000 thousand.

Note 4: The investment income (loss) recognized under equity method and by calculation was based on audited financial statements.

Note 5: It includes the share of profit or loss of associates and joint ventures accounted for using the equity method, as well as unrealized gain or loss with associates and other adjustments at the beginning and end of the period.

Note 6: The difference between investments remitted from Taiwan in amount of USD 69,500 thousand and the received paid-in capital of USD 80,000 thousand was cash capital increase of USD 10,500 thousand made by WINTEK (MAURITIUS) CO., LTD.

Note 7: The difference between investments remitted from Taiwan in amount of USD 16,060 thousand and the paid-in capital of USD 50,000 thousand is an indirect investment of USD 33,940 thousand made by WINTEK (MAURITIUS) CO., LTD. by using cash dividends received from Dynamic Electronics (Kunshan) Co. Ltd.

Note 8: Dynamic Electronics Co., Ltd. (Huangshi) passed the resolution of the board of directors on August 4, 2022 to reduce the capital of USD 73,000 thousand, which was booked under capital surplus. In addition, on September 2, 2022, the board of directors approved a cash capital increase of RMB 35,000 thousand of which RMB 8,888 thousand (equivalent to USD 1,250 thousand) was booked as capital, and the remaining RMB 26,112 thousand was booked as capital surplus.

Note 9: The Company's subsidiary, Dynamic Electronics Co., Ltd. (Huangshi), was officially listed on the Shanghai Stock Exchange on October 24, 2025. And the board of directors approved to proceed a cash capital increase by issuing 52,500 thousand shares at a price of RMB 17.08 per share of which RMB 52,500 thousand (USD 7,402 thousand) was booked as capital, and the remaining RMB 750,662 thousand was booked as capital surplus.

Note 10: Total amount of paid-in capital is RMB 437,029 thousand (USD 65,652 thousand).

Note 11: The Company previously indirectly invested in its China subsidiary, Dynamic Electronics (Kunshan) Co. Ltd., through Dynamic Electronics Holding Pte. Ltd. The Company now indirectly invests in Dynamic Electronics (Kunshan) Co. Ltd., through Dynamic Electronics Co., Ltd. (Huangshi).

Note 12: Transactions between consolidated entities are eliminated in the consolidated financial statements.

107

(B) Significant transactions with investees in Mainland China:

The significant inter-company transactions with the subsidiary in Mainland China, which were eliminated in the preparation of consolidated financial statements, please refer to attachment 6 for details.

Segment information

(1) For management purposes, the Group is organized into business units based on their products and services and has three reportable operating segments as follows:

PCB segment: The segment is primarily responsible for the manufacturing of PCBs and selling them to electronic producers.

Mock-up segment: This segment is responsible for mock-up manufacturing and sales to electronic product manufacturers.

No operating segments have been aggregated to form the above reportable operating segments.

The Group’s operating segments adopts the same accounting policies as the ones in Note 4. Management monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profit or loss and is measured based on accounting policies consistent with those in the consolidated financial statements.

Transfer prices between operating segment are on an arm’s length basis in a manner similar to transactions with third parties.

	PCB Segment	Mock-up Segment	Subtotal	Adjustments and eliminations (Note 1)	Consolidated
For the year ended 2025
Revenues
External customers	$19,386,343	$66,618	$19,452,961	$-	$19,452,961
Inter-segment	17,546,192	4,963	17,551,155	(17,551,155)	-
Interest income	53,293	83	53,376	(38,109)	15,267
Total	$36,985,828	$71,664	$37,057,492	$(17,589,264)	$19,468,228
Segment income (loss)	$778,010	$3,276	$781,286	$-	$781,286
For the year ended 2024
Revenues
External customers	$17,734,162	$52,842	$17,787,004	$-	$17,787,004
Inter-segment	17,215,842	-	17,215,842	(17,215,842)	-
Interest income	98,913	97	99,010	(61,915)	37,095
Total	$35,048,917	$52,939	$35,101,856	$(17,277,757)	$17,824,099
Segment income (loss)	$1,078,425	$(2,886)	$1,075,539	$-	$1,075,539

Note1: Inter-segment revenues are eliminated upon consolidation and recorded under the "adjustments and eliminations" column.

Details of operational asset-related information as of December 31, 2025 and 2024 are as follows:

	PCB Segment	Mock-up Segment	Subtotal	Adjustments and eliminations	Consolidated
Segment assets as of Dec.31, 2025	$38,626,336	$47,561	$38,673,897	$(29,102)	$38,644,795
Segment assets as of Dec.31, 2024	$31,016,382	$39,351	$31,055,733	$(153,399)	$30,902,334

(2) Geographical information

(A) Revenues from external customers (Note):

	For the years ended December 31,
	2025	2024
Taiwan	$1,808,816	$1,001,490
China	7,089,989	6,432,253
Mexico	1,211,939	1,449,890
Korea	1,047,192	1,097,394
Malaysia	1,190,935	1,076,201
Germany	835,627	797,969
Other countries	6,268,463	5,931,807
Total	$19,452,961	$17,787,004

Note: The revenue information above is based on the location of the customer.

(B) Non-current assets:

	As of
	Dec. 31, 2025	Dec. 31, 2024
Taiwan	$30,033	$33,655
China	10,259,923	10,921,498
Thailand	10,351,556	7,153,294
Total	$20,641,512	$18,108,447

(3) Information about major customers

	For the years ended December 31,
	2025	2024
Customer A	$2,373,926	$2,552,989

Endorsement/Guarantee Provided to Others

For the Year Ended December 31, 2025

Attachment 1

(In Thousands of New Taiwan Dollars)

No. (Note 1)	Endorsement/ Guarantee Provider	Guaranteed Party		Limits on Endorsement/ Guarantee Amount Provided to Each Guaranteed Party (Note 3)	Maximum Balance for the Period	Ending Balance	Amount Actually Drawn	Amount of Endorsement/ Guarantee secured by Properties	Ratio of Accumulated Endorsement/ Guarantee to Net Worth per Latest Financial Statements	Maximum Endorsement/ Guarantee Amount Allowed (Note 3)	Endorsement provided by parent company to subsidiaries (Note 4)	Endorsement provided by subsidiaries to parent company (Note 4)	Endorsement provided to entities in China (Note 4)
	Name	Name	Relationship (Note2)
0	Dynamic Holding Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	2	$10,805,393	$3,133,315	$1,117,750	$1,106,573	$-	10.34%	$10,805,393	Y	N	Y
0	Dynamic Holding Co., Ltd.	Dynamic Technology Manufacturing (Thailand) Co., Ltd.	2	$10,805,393	$6,374,220	$6,374,220	$4,236,558	$-	58.99%	$10,805,393	Y	N	N
1	Dynamic Electronics (Taoyuan) Co., Ltd.	Dynamic Technology Manufacturing (Thailand) Co., Ltd.	2	$10,421,360	$313,800	$313,800	$313,800	$-	2.90%	$10,421,360	N	N	N

Note 1: Dynamic Holding Co., Ltd. and subsidiaries are coded as follows:
1. Dynamic Holding Co., Ltd. is coded "0".
2. The subsidiaries are coded consecutively beginning from "1" in the order presented in the table above.

Note 2: The relationship between the guarantor of the endorsement and the object to be guaranteed is as follows:
1. A company with which it does business.
2. A company in which the public company directly and indirectly holds more than 50 percent of the voting shares.
3. A company that directly and indirectly holds more than 50 percent of the voting shares in the public company.
4. A company in which the public company holds, directly or indirectly, 90 percent or more of the voting shares.
5. A company that fulfills its contractual obligations by providing mutual endorsements/guarantees for another company in the same industry or for joint builders for purposes of undertaking a construction project.
6. A company whose co-investment relationship is endorsed by all shareholders in proportion to their shareholding ratio.
7. Companies in the same industry provide among themselves joint and several security for a performance guarantee of a sales contract for pre-construction homes pursuant to the Consumer Protection Act for each other.

Note 3: According to the procedures of Endorsement and Guarantee, the external endorsement or guarantee provided by the Company and its subsidiaries shall not exceed 120% of the current net value of the Company.

Also, the limitation of endorsement or guarantee provided for any single entity shall not exceed the current net value of the Company.

If the total amount of endorsements and guarantees provided by the Company and its subsidiaries reaches 50% or more of the current net value of the Company, the necessity and reasonableness of such endorsements and guarantees shall be explained at the shareholders' meeting.

The current net value shall be based on the most recent audited or reviewed financial statements.

Note 4: A "Y" should be filled in for endorsements or guarantees provided by a listed parent company for its subsidiary, by a subsidiary for its listed parent company, or originating from mainland China.

Name, locations and related information of investees (excluding investees in Mainland China)

As of December 31, 2025

Attachment 2

(In Thousands of Foreign Currency / New Taiwan Dollars)

Investor	Investee	Address	Main Business and Product	Original Investment Amount		Balance as of December 31, 2025			Net Income (Loss) of the Investee	Share of Income (Loss) of the Investee	Note
				As of December 31, 2025	As of December 31, 2024	Shares	%	Carrying Value
Dynamic Holding Co., Ltd.	Dynamic Electronics (Taoyuan) Co., Ltd.	33846 6F., No. 50, Minquan Rd., Luzhu Dist., Taoyuan City, Taiwan	Investing activities	$6,148,342	$6,148,342	467,074,889	100.00%	$10,421,359	$860,484	$860,484	Note 1
Dynamic Holding Co., Ltd.	CHIANAN TECHNOLOGY CO., LTD.	24257 2F, No. 649, Zhongzheng Road, Xinzhuang District, New Taipei City, Taiwan	Mockup manufacture	$16,428	$16,428	7	70.00%	$6,639	$1,585	$1,109	Note 1
Dynamic Holding Co., Ltd.	CHENG CHONG TECHNOLOGY CO., LTD	24260 2F, No. 649-1, Zhongzheng Road, Xinzhuang District, New Taipei City, Taiwan	Mockup manufacture	$33,533	$33,533	7	70.00%	$37,034	$1,691	$1,184	Note 1
Dynamic Electronics (Taoyuan) Co., Ltd.	WINTEK (MAURITIUS) CO., LTD.	Level 3, Alexander House, 35 Cybercity, Ebene, Mauritius	Investing activities	$2,788,141	$2,788,141	8,596,000	100.00%	$11,455,271	$1,065,958	$1,065,958	Note 1
WINTEK (MAURITIUS) CO., LTD.	Dynamic Electronics Holding Pte. Ltd.	151 CHIN SWEE ROAD, #04-8C, MANHATTAN HOUSE, SINGAPORE(169876)	Investing activities	$1,564,061	$1,564,061	142,067,000	100.00%	USD 364,437	USD 34,153	USD 34,153	Note 1
Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Electronics Co., Ltd. (Seychelles)	Office 1, 1st Floor, DEKK Complex, Plaisance, Mahé, Republic of Seychelles	PCB and business which relates to import and export	$82,967	$82,967	50,000	100.00%	CNY 547,290	CNY 214,274	CNY 214,274	Note 1
Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Overseas Investment	151 CHIN SWEE ROAD, #04-8D, MANHATTAN HOUSE, SINGAPORE(169876)	Management operations services	$5,629,014	$3,788,900	179,050,000	100.00%	CNY 1,050,089	(CNY 217,827)	(CNY 217,827)	Note 1
Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Technology (Thailand)	106 Moo 7 Thatoom, Srimahaphot, Prachinburi 25140	Manufacture and sale of PCB	$-	$-	2	0.01%	USD 0	(USD 30,314)	USD 0	Note 1
Dynamic Overseas Investment	Dynamic Technology (Thailand)	106 Moo 7 Thatoom, Srimahaphot, Prachinburi 25140	Manufacture and sale of PCB	$5,619,338	$3,779,224	60,999,998	99.99%	USD 145,325	(USD 30,314)	(USD 30,314)	Note 1

Note 1: Transactions are eliminated when preparing the consolidated financial statements.

Financing provided to others

For the Year Ended December 31, 2025

Attachment 3

(In Thousands of New Taiwan Dollars)

NO. (Note1)	Lender	Counter-party	Financial accounting account	Related Party	Maximum balance for the period	Ending balance	Actual amount provided	Interest rate	Nature of financing (Note 2)	Amount of sales to (purchases from) counter-party	Reason for financing	Loss Allowance	Collateral		Limit of financing amount for individual counter-party	Limit of total financing amount
													Item	Value
1	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	Other receivables	Yes	$1,182,480	$1,162,460	$1,162,460	3.00%~3.45%	2	$-	Business turnover	$-	-	$-	$1,954,510 (Note 3)	$1,954,510 (Note 3)
2	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Technology Manufacturing (Thailand) Co., Ltd.	Other receivables	Yes	$914,975	$878,640	$878,640	0.00%~5.81%	2	$-	Business turnover	$-	-	$-	$1,468,358 (Note 4)	$1,468,358 (Note 4)

Note 1: Dynamic Holding Co., Ltd. and subsidiaries are coded as follows:
1. The Company is "0".
2. The subsidiaries are coded consecutively beginning from "1" in the order presented in the table above.

Note 2: Nature of financing is coded as follows:
1. Need for operating is coded "1".
2. Need for short term financing is coded "2".

Note 3: Limit of total financing amount shall not exceed 60% of the lender's net assets of value as of December 31, 2025. Limit of financing amount for individual counter-party shall not exceed 60% of the lender's net assets value as of December 31, 2025.

Note 4: Limit of total financing amount shall not exceed 60% of the lender's net assets of value as of December 31, 2025. Limit of financing amount for individual counter-party shall not exceed 60% of the lender's net assets value as of December 31, 2025.

Related party transactions with purchases and sales amounts of at least NT$100 million or 20 percent of the paid-in capital

Attachment 4

(In Thousands of Foreign Currency)

Company Name	Related Party	Nature of Relationship	Transaction Details				Abnormal Transaction		Notes/Accounts Payable or Receivable		Note
			Purchase/Sale	Amount	% to Total	Payment/ Collection Term	Unit Price	Payment/ Collection Term	Ending Balance	% to Total
Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Seychelles)	Subsidiary	Sales	RMB 895,368	62.19%	90 days after monthly closing.	Specs of goods sold are different from others. Cannot be reasonably compared.	Non relative parties are 60–150 days after monthly closing.	Accounts receivable RMB 406,109	64.07%	Note 1
Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	Subsidiary	Sales	RMB 134,255	9.33%	90 days after monthly closing.	Specs of goods sold are different from others. Cannot be reasonably compared.	Non relative parties are 60–150 days after monthly closing.	Accounts receivable RMB 70,689	11.15%	Note 1
Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	Subsidiary	Purchases	RMB 578,469	53.79%	90 days after monthly closing.	Specs of goods purchased are different from others. Cannot be reasonably compared.	Non relative parties are 90–120 days after monthly closing.	Accounts payable RMB 42,333	16.61%	Note 1
Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Technology Manufacturing (Thailand) Co., Ltd.	Subsidiary	Purchases	RMB 63,719	5.92%	90 days after monthly closing.	Specs of goods purchased are different from others. Cannot be reasonably compared.	Non relative parties are 90–120 days after monthly closing.	Accounts payable RMB 11,771	4.62%	Note 1
Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Electronics (Kunshan) Co., Ltd.	Subsidiary	Purchases	RMB 134,255	6.04%	90 days after monthly closing.	Specs of goods purchased are different from others. Cannot be reasonably compared.	Non relative parties are 90–120 days after monthly closing.	Accounts payable RMB 70,689	9.56%	Note 1
Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Electronics (Kunshan) Co., Ltd.	Subsidiary	Sales	RMB 578,469	16.89%	90 days after monthly closing.	Specs of goods sold are different from others. Cannot be reasonably compared.	Non relative parties are 120 days after monthly closing.	Accounts receivable RMB 42,333	4.05%	Note 1
Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Electronics Co., Ltd. (Seychelles)	Subsidiary	Sales	RMB 2,030,226	59.29%	90 days after monthly closing.	Specs of goods sold are different from others. Cannot be reasonably compared.	Non relative parties are 120 days after monthly closing.	Accounts receivable RMB 545,030	52.12%	Note 1

Related party transactions with purchases and sales amounts of at least NT$100 million or 20 percent of the paid-in capital

Attachment 4
(In Thousands of Foreign Currency)

Company Name	Related Party	Nature of Relationship	Transaction Details				Abnormal Transaction		Notes/Accounts Payable or Receivable		Note
			Purchase/Sale	Amount	% to Total	Payment/ Collection Term	Unit Price	Payment/ Collection Term	Ending Balance	% to Total
Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Technology Manufacturing (Thailand) Co., Ltd.	Subsidiary	Purchases	RMB 258,219	11.62%	90 days after monthly closing.	Specs of goods purchased are different from others. Cannot be reasonably compared.	Non relative parties are 90–120 days after monthly closing.	Accounts payable RMB 34,701	4.69%	Note 1
Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Electronics Co., Ltd. (Huangshi)	Subsidiary	Purchases	USD 283,378	68.43%	90 days after monthly closing.	Not comparable.	No non-related parties to be compared with.	Accounts payable USD 77,333	56.03%	Note 1
Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Electronics (Kunshan) Co., Ltd.	Subsidiary	Purchases	USD 124,948	30.17%	90 days after monthly closing.	Not comparable.	No non-related parties to be compared with.	Accounts payable USD 57,567	41.71%	Note 1
Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Technology Manufacturing (Thailand) Co., Ltd.	Subsidiary	Purchases	USD 5,731	1.38%	90 days after monthly closing.	Not comparable.	No non-related parties to be compared with.	Accounts payable USD 3,122	2.26%	Note 1
Dynamic Technology Manufacturing (Thailand) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	Subsidiary	Sales	THB 1,184,184	66.46%	90 days after monthly closing.	Specs of goods sold are different from others. Cannot be reasonably compared.	No non-related parties to be compared with.	Accounts receivable THB 154,872	54.65%	Note 1
Dynamic Technology Manufacturing (Thailand) Co., Ltd.	Dynamic Electronics (Kunshan) Co., Ltd.	Subsidiary	Sales	THB 317,919	17.84%	90 days after monthly closing.	Specs of goods sold are different from others. Cannot be reasonably compared.	No non-related parties to be compared with.	Accounts receivable THB 52,398	18.49%	Note 1
Dynamic Technology Manufacturing (Thailand) Co., Ltd.	Dynamic Electronics Co., Ltd. (Seychelles)	Subsidiary	Sales	THB 186,043	10.44%	90 days after monthly closing.	Specs of goods sold are different from others. Cannot be reasonably compared.	No non-related parties to be compared with.	Accounts receivable THB 75,772	26.74%	Note 1

Note1: Transactions are eliminated when preparing the consolidated financial statements.

Receivables from related parties of at least NT$100 million or 20 percent of the paid-in capital

Attachment 5
(In Thousands of Foreign Currency)

Company Name	Related Party	Nature of Relationship	Ending Balance	Turnover Ratio	Overdue
					Amount	Action Taken
Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd (Seychelles)	Subsidiary	RMB 406,109
(Note 1 and 2)	2.29	$-	-	RMB 146,112	$-
Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	Subsidiary	RMB 70,689
(Note 1 and 2)	2.57	$-	-	RMB 14,848	$-
Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Electronics Co., Ltd (Seychelles)	Subsidiary	RMB 545,030
(Note 1 and 2)	4.10	$-	-	RMB 163,815	$-
Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Electronics (Kunshan) Co., Ltd.	Subsidiary	RMB 42,333
(Note 1 and 2)	4.35	$-	-	RMB 40,000	$-
Dynamic Technology Manufacturing (Thailand) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	Subsidiary	THB 154,872
(Note 1 and 2)	14.54	$-	-	THB 91,217	$-
Dynamic Technology Manufacturing (Thailand) Co., Ltd.	Dynamic Electronics (Kunshan) Co., Ltd.	Subsidiary	THB 52,398
(Note 1 and 2)	12.13	$-	-	THB 34,895	$-

Note1: Accounts receivable.
Note2: Transactions are eliminated when preparing the consolidated financial statements.

Inter Group relationships and significant inter Group transactions

Attachment 6

(In Thousands of Foreign Currency / New Taiwan Dollars)

No. (Note 1)	Company Name	Counter-Party	Nature of Relationship (Note 2)	Intercompany Transaction
				Financial Statement Account	Amount	Terms	Percentage to Consolidated Net Revenue or Total Assets (Note 3)
	For the year Ended December 31, 2025
1	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Electronics (Kunshan) Co., Ltd.	3	Purchases	USD 124,948	90 days after monthly closing	20.19%
1	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Electronics (Kunshan) Co., Ltd.	3	Accounts payable	USD 57,567	90 days after monthly closing	4.68%
1	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Electronics Co., Ltd. (Huangshi)	3	Purchases	USD 283,378	90 days after monthly closing	45.79%
1	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Electronics Co., Ltd. (Huangshi)	3	Accounts payable	USD 77,333	90 days after monthly closing	6.29%
1	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Overseas Investment	3	Other managing expenses	USD 46	-	0.01%
1	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Technology (Thailand)	3	Purchases	USD 5,731	90 days after monthly closing	0.93%
1	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Technology (Thailand)	3	Accounts payable	USD 3,122	90 days after monthly closing	0.25%
1	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Technology (Thailand)	3	Other managing expenses	USD 2,741	-	0.44%
1	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Technology (Thailand)	3	Other receivables (financing)	USD 28,000	-	2.28%
1	Dynamic Electronics Co., Ltd. (Seychelles)	Dynamic Technology (Thailand)	3	Other interest income	USD 144	-	0.02%
2	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	3	Purchases	RMB 578,469	90 days after monthly closing	13.30%
2	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	3	Accounts payable	RMB 42,333	90 days after monthly closing	0.49%
2	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	3	Other receivables	RMB 4,183	-	0.05%
2	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	3	Other receivables (financing)	RMB 260,000	-	3.01%
2	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	3	Other interest income	RMB 7,750	-	0.18%
2	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	3	Accounts receivable	RMB 70,689	90 days after monthly closing	0.82%
2	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Electronics Co., Ltd. (Huangshi)	3	Sales	RMB 134,255	90 days after monthly closing	3.09%
2	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Technology (Thailand)	3	Purchases	RMB 63,719	90 days after monthly closing	1.46%
2	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Technology (Thailand)	3	Accounts payable	RMB 11,771	90 days after monthly closing	0.14%
2	Dynamic Electronics (Kunshan) Co., Ltd.	Dynamic Technology (Thailand)	3	Other receivables	RMB 7,068	-	0.08%
3	Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Technology (Thailand)	3	Purchases	RMB 258,219	90 days after monthly closing	5.94%
3	Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Technology (Thailand)	3	Accounts payable	RMB 34,701	90 days after monthly closing	0.40%
3	Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Technology (Thailand)	3	Other payables	RMB 18,697	90 days after monthly closing	0.22%
3	Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Technology (Thailand)	3	Accounts receivable	RMB 1,392	90 days after monthly closing	0.02%
3	Dynamic Electronics Co., Ltd. (Huangshi)	Dynamic Technology (Thailand)	3	Sales	RMB 3,230	90 days after monthly closing	0.07%
4	CHIANAN TECHNOLOGY CO., LTD.	CHENG CHONG TECHNOLOGY CO., LTD	3	Other income	TWD 1,800	-	0.01%
4	CHIANAN TECHNOLOGY CO., LTD.	CHENG CHONG TECHNOLOGY CO., LTD	3	Sales	TWD 4,963	90 days after monthly closing	0.03%

Note 2: Transactions are categorized as follows:
1. Investor to investee.
2. Investee to investor.
3. Investee to investee.

Note 3: The percentage base with respect to the total consolidated revenue-weighted average (about income statement accounts) or total assets (about balance sheet accounts).

Note 4: Foreign currencies were converted into New Taiwan dollars based on exchanged rate of balance sheet date.

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Dynamic Holding — Audit Report / Information 2025

52377_rns_2026-06-01_151ff072-7533-47a9-b710-0dadbf984d5a.pdf

DYNAMIC HOLDING CO., LTD.

AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

WITH AUDIT REPORT OF INDEPENDENT ACCOUNTANTS

AS OF DECEMBER 31, 2025 AND 2024

AND FOR THE YEARS THEN ENDED

MANAGEMENT REPRESENTATION LETTER

English Translation of a Report Originally Issued in Chinese

AUDIT REPORT OF INDEPENDENT AUDITORS

Opinion

Basis for Opinion

Key Audit Matters

Revenue Recognition

Provision against inventory

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

Others

Notices to Readers

4. Summary of significant accounting policies

(1) Statement of compliance

(2) Basis of preparation

(4) Foreign currency transactions

Financial assets measured at amortized cost

Financial asset measured at fair value through profit or loss

(B) Impairment of financial assets

Compound instruments

Financial liabilities

Financial liabilities at fair value through profit or loss

Financial liabilities at amortized cost

Derecognition of financial liabilities

(E) Offsetting of financial instruments

(9) Derivative instrument

(13) Leases

Group as a lessee

(14) Intangible assets

(16) Provisions

(17) Revenue recognition

Sales of goods

(22) Business combinations and goodwill

6. Contents of significant accounts

(1) Cash and cash equivalents

(2) Financial assets measured at amortized cost

(8) Impairment testing of goodwill

Key assumptions used in value-in-use calculations

Sensitivity to changes in assumptions

(A) Disaggregation of revenue

(B) Contract balances

b. Lease liabilities

(b) Income and costs relating to leasing activities

(25) Earnings per share

7. Related party transactions

8. Assets pledged as collateral

9. Significant contingencies and unrecognized contract commitments

Interest rate risk

Equity price risk

(4) Credit risk management

(5) Liquidity risk management

Non-derivative financial liabilities

(6) Reconciliation of liabilities arising from financing activities

Reconciliation of liabilities for the year ended December 31, 2025:

(7) Fair values of financial instruments

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Dynamic Holding Audit Report / Information 2025