ETERNAL — Interim / Quarterly Report 2021

Nov 5, 2021

Eternal Materials Co., Ltd. and Subsidiaries

Consolidated Financial Statements for the Nine Months Ended September 30, 2021 and 2020 and Independent Auditors’ Review Report (Stock Code:1717)

For the convenience of readers, the independent auditors’ review report and the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors’ review report and consolidated financial statements shall prevail.

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INDEPENDENT AUDITORS’ REVIEW REPORT

Eternal Materials Co., Ltd.

Opinion

We have reviewed the accompanying consolidated balance sheets of Eternal Materials Co., Ltd. (the “Company”) and its subsidiaries as of September 30, 2021 and 2020, the consolidated statements of comprehensive income for the three months and nine months ended September 30, 2021 and 2020, and the changes in equity and cash flows for the nine months then ended September 30, 2021 and 2020, and notes to the consolidated financial statements, including a summary of significant accounting policies (collectively referred to as the “consolidated financial statements”). Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34“Interim Financial Reporting” endorsed and issued into effect by the Financial Supervisory Commission(FSC) of the Republic of China. Our responsibility is to express a conclusion on the consolidated financial statements based on our reviews.

Scope of Review

Except as explained in the following paragraph, we conducted our reviews in accordance with Statement of Auditing Standards No. 65“Review of Financial Information Performed by the Independent Auditor of the Entity”. A review of consolidated financial statements consists of making inquiries, primarily of persons responsible for financial less in scope than an audit and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Basis for Qualified Conclusion

As disclosed in Note 13 to the consolidated financial statements, total assets of some non-significant subsidiaries included in the consolidated statements were NT$25,158,533 thousand and NT$21,876,941 thousand, constituting 42% and 41% of the consolidated total assets, respectively; total liabilities were NT$9,350,971 thousand and NT$8,195,982 thousand , constituting 26% of the consolidated total liabilities as of September 30, 2021 and 2020; total comprehensive income profit or loss of these consolidated subsidiaries for the three months and nine months ended September 30, 2021 and 2020 were at a profit of NT$70,125 thousand, loss of NT$603,259 thousand , profit of NT$375,161 thousand, and loss of NT$673,134 thousand, respectively, constituting 9%, 41%, 16% and 41% of the consolidated total comprehensive income, respectively. The amounts and information disclosed in Notes 37 to the consolidated financial statements were based solely on the reports prepared and disclosed by these subsidiaries, which were not reviewed by independent accountants for the same reporting periods. In addition, as disclosed in Note 14 to the consolidated financial statements, the total carrying amounts of investments accounted for using the equity method were NT$2,415,349 thousand and NT$2,179,284 thousand as of September 30, 2021 and 2020, respectively; the share of the profit of associates and joint ventures accounted for using the equity method were NT$108,506 thousand, NT$97,530 thousand, NT$335,134 thousand and NT$212,558 thousand for the three months and nine months ended September 30, 2021 and 2020, respectively; the Share of the other comprehensive loss of associates and joint ventures were NT$4,842 thousand, profit of NT$16,958 thousand, loss of NT$29,129 thousand and loss of NT$17,080 thousand for the three months and nine months ended September 30, 2021 and 2020, respectively. The amounts and information disclosed in Notes 37 to the consolidated financial statements were based solely on the reports recognized and disclosed by investees, which were not reviewed by independent accountants for the same reporting periods.

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Qualified Conclusion

Base on our reviews, except for the effect of such adjustments, if any, as might have been determined to be necessary had the financial statements of the non-significant subsidiaries and other equity-method investees as described in the preceding paragraph been reviewed by independent accountants, nothing has come to our attention that caused us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the financial position of the Company and its subsidiaries as of September 30, 2021 and 2020, and of its consolidated financial performance for the three months and nine months ended September 30, 2021 and 2020, and its consolidated cash flows for the nine months ended September 30, 2021 and 2020 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and international Accounting Standard 34“Interim Financial Reporting”endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

The engagement partners on the reviews resulting in this independent auditors’ review report are Chao-Chun Wang and Lee-Yuan Kuo.

Deloitte & Touche Taipei, Taiwan Republic of China

November 5, 2021

Notice to Readers

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

For the convenience of readers, the independent auditors’ review report and the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors’ review report and consolidated financial statements shall prevail.

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Eternal Materials Co., Ltd. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

(In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Note 6) Financial assets at fair value through profit or loss-current（Note 7） Notes receivable, net (Notes 8 and 33) Notes receivable from related parties, net (Notes 8 and 32) Accounts receivable, net (Note 8) Accounts receivable from related parties, net (Notes 8 and 32) Other receivables (Notes 8 and 32) Inventories (Note 9) Other financial assets - current (Note 11) Other current assets - others Total current assets NON-CURRENT ASSETS Financial assets at fair value through profit or loss - non-current (Note 7) Financial assets at fair value through other comprehensive income - non-current (Note 12) Investments accounted for using the equity method (Note 14) Property, plant and equipment (Notes 15 and 33) Right-of-use assets (Note 16) Investment properties (Note 17) Intangible assets (Note 18) Deferred tax assets Other non-current assets - others (Notes 19 and 33) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Notes 20 and 33) Notes payable Accounts payable (Note 32) Other payables - others Current tax liabilities Liabilities directly associated with non-current assets held for sale (Note 10) Lease liabilities - current (Note 16) Current portion of long-term borrowings (Notes 20 and 33) Other current liabilities - others (Note 23) Total current liabilities NON-CURRENT LIABILITIES Bonds payable (Note 20) Long-term borrowings (Notes 20 and 33) Deferred tax liabilities Lease liabilities - non-current (Note 16) Other non-current liabilities (Note 14) Total non-current liabilities Total liabilities EQUITY ATTRIBUTABALE TO OWNERS OF THE COMPANY (Note 22) Ordinary shares Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Total equity attributable to owners of the Company NON-CONTROLLING INTERESTS (Note 22) Total equity TOTAL	September 30,2021（Reviewed） Amount ％ $ 5,544,753 9 77,578 - 6,164,667 10 62,884 - 13,027,984 22 238,380 - 740,871 1 10,051,880 17 62,855 - 932,313 2 36,904,165 61 13,314 - 1,032,660 2 2,439,182 4 16,167,497 27 1,113,526 2 1,311,636 2 267,515 - 392,563 1 570,871 1 23,308,764 39 $ 60,212,929 100 $ 7,239,064 12 800,165 1 6,382,060 11 2,096,175 4 457,970 1 - - 76,034 - 3,223,745 5 170,237 - 20,445,450 34 5,491,122 9 6,700,545 11 2,554,761 4 212,967 1 1,168,090 2 16,127,485 27 36,572,935 61 12,402,795 20 368,946 1 4,437,120 8 781,875 1 6,718,216 11 11,937,211 20 ( 1,439,713) ( 2) 23,269,239 39 370,755 - 23,639,994 39 $ 60,212,929 100	December 31,2020（Audited） Amount ％ $ 6,108,294 11 - - 5,138,238 9 44,739 - 12,121,573 22 218,637 - 791,068 2 7,492,620 13 61,860 - 644,919 1 32,621,948 58 21,301 - 1,016,306 2 2,306,731 4 16,623,050 30 1,195,535 2 1,356,821 2 282,235 - 397,389 1 367,309 1 23,566,677 42 $ 56,188,625 100 $ 4,403,929 8 534,320 1 5,598,389 10 2,053,754 4 442,184 1 - - 81,002 - 2,211,266 4 188,277 - 15,513,121 28 2,995,374 5 10,190,026 18 2,641,898 5 262,898 1 1,347,006 2 17,437,202 31 32,950,323 59 12,402,795 22 368,946 1 4,188,871 7 1,442,690 3 5,213,715 9 10,845,276 19 ( 782,520) ( 1) 22,834,497 41 403,805 - 23,238,302 41 $ 56,188,625 100	September 30,2020（Reviewed） Amount ％ $ 5,284,794 10 1,541,253 3 4,054,046 8 33,576 - 10,538,169 20 177,111 - 800,326 2 7,157,258 13 66,950 - 554,885 1 30,208,368 57 26,509 - 928,082 2 2,224,655 4 16,522,567 31 1,119,808 2 1,273,498 2 433,253 1 385,968 1 302,014 - 23,216,354 43 $ 53,424,722 100 $ 4,127,572 8 527,988 1 4,058,517 8 1,826,187 3 297,332 1 32,963 - 55,125 - 2,204,211 4 239,454 - 13,369,349 25 2,995,076 6 11,084,758 21 2,682,358 5 221,801 - 1,296,537 2 18,280,530 34 31,649,879 59 12,402,795 23 368,888 1 4,188,871 8 1,442,690 3 4,492,554 8 10,124,115 19 ( 1,539,573) ( 3) 21,356,225 40 418,618 1 21,774,843 41 $ 53,424,722 100

The accompanying notes are an integral part of the consolidated financial statements. (With Deloitte & Touche auditors’ review report dated November 5, 2021)

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Eternal Materials Co., Ltd. and Subsidiaries

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

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For the Three Months Ended September 30 For the Nine Months Ended September 30
2021 2020 2021 2020
Amount ％ Amount ％ Amount ％ Amount ％
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		2021 Amount		％		2020 Amount		％		2021 Amount		％		2020 Amount		％
OPERATING REVENUE
(Notes 23 and 32)		$13,010,194		100		$ 9,888,564		100		$37,423,668		100		$26,474,211		100
OPERATING COSTS (Notes
9, 24 and 32)		10,324,806		79		7,498,382		76		29,279,907		78		20,333,458		77
GROSS PROFIT		2,685,388		21		2,390,182		24		8,143,761		22		6,140,753		23
OPERATING EXPENSES
(Notes 8, 24 and 32)
Selling and marketing
expenses		729,219		6		562,563		6		2,150,251		6		1,533,056		6
General and
administrative
expenses		512,934		4		486,710		5		1,568,732		4		1,448,028		5
Research and
development expenses		395,020		3		354,648		3		1,089,480		3		989,487		4
Expected credit loss
(gain)		2,626		-		21,166		-	(	4,847)		-		105,911		-
Total operating
expenses		1,639,799		13		1,425,087		14		4,803,616		13		4,076,482		15
PROFIT FROM
OPERATIONS		1,045,589		8		965,095		10		3,340,145		9		2,064,271		8
NON-OPERATING
INCOME AND
EXPENSES
Interest income (Note
24)		25,825		-		30,113		-		76,078		-		83,671		-
Other income (Notes 24
and 32)		106,596		1		92,147		1		217,388		1		169,465		-
Other gains and losses
(Note 24)		56,865		1		13,829		-	(	9,706 )		-	(	60,171 )		-
Net foreign exchange
gains and losses (Note
36)	(	13,970 )		-	(	9,872 )		-	(	74,385 )		-	(	22,139 )		-
Finance costs (Note 24)	(	76,182 )	(	1 )	(	89,460 )	(	1 )	(	219,602 )	(	1 )	(	295,468 )	(	1 )
Share of the profit of
associates and joint
ventures (Note 14)		108,506		1		97,530		1		335,134		1		212,558		1
Total non-operating
income and
expenses		207,640		2		134,287		1		324,907		1		87,916		-
PROFIT BEFORE INCOME
TAX		1,253,229		10		1,099,382		11		3,665,052		10		2,152,187		8
INCOME TAX EXPENSE
(Notes 4 and 25)	(	267,374)	(	2)	(	210,875)	(	2)	(	786,679)	(	2)	(	421,945)	(	1)
NET PROFIT FOR THE
PERIOD		985,855		8		888,507		9		2,878,373		8		1,730,242		7

(Continued)

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OTHER COMPREHENSIVE INCOME (LOSS) (Notes 22 and 25) Items that will not be reclassified subsequently to profit or loss: Unrealized gains and losses on investments in equity instruments at fair value through other comprehensive income Income tax relating to items that will not be reclassified subsequently to profit or loss Items that may be reclassified subsequently to profit or loss: Exchange differences on translation of the financial statement of foreign operations Share of the other comprehensive income (loss) of associates and joint ventures Other comprehensive income (loss) for the period, net of income tax TOTAL COMPREHENSIVE INCOME FOR THE PERIOD NET PROFIT (LOSS) ATTRIBUTABLE TO: Owners of the Company Non-controlling interests TOTAL COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO: Owners of the Company Non-controlling interests EARNINGS PER SHARE (Note 26) Basic Diluted	For the Three Months Ended September 30 2021 2020 Amount ％ Amount ％ ( $ 129,998 ) ( 1 ) $ 101,159 1 12,135 - 2,137 - ( 76,218 ) ( 1 ) 464,372 5 ( 4,842) - 16,958 - ( 198,923) ( 2) 584,626 6 $ 786,932 6 $ 1,473,133 15 $ 981,184 $ 896,235 4,671 ( 7,728) $ 985,855 $ 888,507 $ 780,614 $ 1,475,727 6,318 ( 2,594) $ 786,932 $ 1,473,133 $ 0.79 $ 0.72 0.79 0.72	For the Three Months Ended September 30 2021 2020 Amount ％ Amount ％ ( $ 129,998 ) ( 1 ) $ 101,159 1 12,135 - 2,137 - ( 76,218 ) ( 1 ) 464,372 5 ( 4,842) - 16,958 - ( 198,923) ( 2) 584,626 6 $ 786,932 6 $ 1,473,133 15 $ 981,184 $ 896,235 4,671 ( 7,728) $ 985,855 $ 888,507 $ 780,614 $ 1,475,727 6,318 ( 2,594) $ 786,932 $ 1,473,133 $ 0.79 $ 0.72 0.79 0.72	For the Three Months Ended September 30 2021 2020 Amount ％ Amount ％ ( $ 129,998 ) ( 1 ) $ 101,159 1 12,135 - 2,137 - ( 76,218 ) ( 1 ) 464,372 5 ( 4,842) - 16,958 - ( 198,923) ( 2) 584,626 6 $ 786,932 6 $ 1,473,133 15 $ 981,184 $ 896,235 4,671 ( 7,728) $ 985,855 $ 888,507 $ 780,614 $ 1,475,727 6,318 ( 2,594) $ 786,932 $ 1,473,133 $ 0.79 $ 0.72 0.79 0.72	For the Three Months Ended September 30 2021 2020 Amount ％ Amount ％ ( $ 129,998 ) ( 1 ) $ 101,159 1 12,135 - 2,137 - ( 76,218 ) ( 1 ) 464,372 5 ( 4,842) - 16,958 - ( 198,923) ( 2) 584,626 6 $ 786,932 6 $ 1,473,133 15 $ 981,184 $ 896,235 4,671 ( 7,728) $ 985,855 $ 888,507 $ 780,614 $ 1,475,727 6,318 ( 2,594) $ 786,932 $ 1,473,133 $ 0.79 $ 0.72 0.79 0.72	For the Nine Months	For the Nine Months	Ended September 30	Ended September 30
	2021	％ ( 1 ) - ( 1 ) - ( 2) 6		2020	2021	％ - - ( 2 ) - ( 2) 6	2020
	Amount ( $ 129,998 ) 12,135 ( 76,218 ) ( 4,842) ( 198,923) $ 786,932 $ 981,184 4,671 $ 985,855 $ 780,614 6,318 $ 786,932 $ 0.79 0.79			Amount $ 101,159 2,137 464,372 16,958 584,626 $ 1,473,133 $ 896,235 7,728) $ 888,507 $ 1,475,727 2,594) $ 1,473,133 $ 0.72 0.72	Amount $ 103,671 28,992 ( 697,991 ) ( 29,129) ( 594,457) $ 2,283,916 $ 2,879,931 ( 1,558) $ 2,878,373 $ 2,298,367 ( 14,451) $ 2,283,916 $ 2.32 2.31		Amount $ 189,949 ( 30,416 ) ( 248,928 ) ( 17,080) ( 106,475) $ 1,623,767 $ 1,758,116 ( 27,874) $ 1,730,242 $ 1,661,232 ( 37,465) $ 1,623,767 $ 1.42 1.41	％
			( (					- - ( 1 ) - ( 1) 6

(Concluded)

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

(With Deloitte & Touche auditors’ review report dated November 5, 2021)

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Eternal Materials Co., Ltd. and Subsidiaries

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (In Thousands of New Taiwan Dollars, Except Dividends Per Share) (Reviewed, Not Audited)

BALANCE AT JANUARY 1, 2021 Appropriation of 2020 earnings(Note 22) Legal reserve Cash dividends distributed by the Company－NT$1.5 per share Reversal of special reserve Net profit (loss) for the nine months ended September 30, 2021 Other comprehensive income (loss) for the nine months ended September 30, 2021, net of income tax Total comprehensive income (loss) for the nine months ended September 30, 2021 Decrease in non-controlling interests Disposal of investments in equity instruments designated as at fair value through other comprehensive income Others(Note 22) BALANCE AT SEPTEMBER 30, 2021 BALANCE AT JANUARY 1, 2020 Appropriation of 2019 earnings(Note 22) Legal reserve Special reserve Cash dividends distributed by the Company－NT$1.4 per share Net profit (loss) for the nine months ended September 30, 2020 Other comprehensive income (loss) for the nine months ended September 30, 2020, net of income tax Total comprehensive income (loss) for the nine months ended September 30, 2020 Disposal of subsidiaries The difference between the consideration received or paid and the carrying amount of the subsidiaries’ net assets during actual disposal or acquisition (Note 27) Decrease in non-controlling interests Disposal of investments in equity instruments designated as at fair value through other comprehensive income BALANCE AT SEPTEMBER 30, 2020		Equity Attributable to Owners of	the Company		Total Non-controlling Interests Total Equity $ 22,834,497 $ 403,805 $ 23,238,302 - - - 1,860,419 ) - ( 1,860,419 ) - - - 1,860,419) - (1,860,419) 2,879,931 ( 1,558 ) 2,878,373 581,564) ( 12,893) ( 594,457) 2,298,367 ( 14,451) 2,283,916 - ( 18,599) ( 18,599) 3,206) - ( 3,206) - - - $ 23,269,239 $ 370,755 $ 23,639,994 $ 21,415,337 $ 504,398 $ 21,919,735 - - - - - - 1,736,391) - (1,736,391) 1,736,391) - (1,736,391) 1,758,116 ( 27,874 ) 1,730,242 96,884) ( 9,591) ( 106,475) 1,661,232 ( 37,465) 1,623,767 - ( 146) ( 146) 12,842 ( 40,571) ( 27,729) - ( 7,598) ( 7,598) 3,205 - 3,205 $ 21,356,225 $ 418,618 $ 21,774,843
	Ordinary Shares Capital Surplus $ 12,402,795 $ 368,946 - - - - - - - - - - - - - - - - - - - - $ 12,402,795 $ 368,946 $ 12,402,795 $ 356,046 - - - - - - - - - - - - - - - - - 12,842 - - - - $ 12,402,795 $ 368,888	Retained Earnings Legal Reserve Special Reserve Unappropriated Earnings $ 4,188,871 $ 1,442,690 $ 5,213,715 248,249 - ( 248,249 ) - - ( 1,860,419 ) - ( 660,170) 660,170 248,249 ( 660,170) (1,448,498) - - 2,879,931 - - - - - 2,879,931 - - - - - 72,423 - ( 645) 645 $ 4,437,120 $ 781,875 $ 6,718,216 $ 3,942,840 $ 510,893 $ 5,645,452 246,031 - ( 246,031 ) - 931,797 ( 931,797 ) - - (1,736,391) 246,031 931,797 (2,914,219) - - 1,758,116 - - - - - 1,758,116 - - - - - - - - - - - 3,205 $ 4,188,871 $ 1,442,690 $ 4,492,554	Other Equity	Total Other Equity $ 782,520) - - ( - - ( - 581,564) ( 581,564) - 75,629) ( - $ 1,439,713 ) $ 1,442,689) - - - ( - ( - 96,884) ( 96,884) - - - - $ 1,539,573 )
			Exchange Differences on Translation of The Financial Unrealized Gains and Losses on Financial Assets at Fair Value Statements of Foreign Operations Through Other Comprehensive Income ($ 1,320,826) $ 538,306 ( - - - - - - - - - - ( 714,227) 132,663 ( ( 714,227) 132,663 ( - - - ( 75,629) ( - - ( $ 2,035,053 ) $ 595,340 ( ($ 1,684,908) $ 242,219 ( - - - - - - - - - - ( 256,417) 159,533 ( ( 256,417) 159,533 ( - - - - - - - - ( $ 1,941,325 ) $ 401,752 (

The accompanying notes are an integral part of the consolidated financial statements. (With Deloitte & Touche auditors’ review report dated November 5, 2021)

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Eternal Materials Co., Ltd. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

CASH FLOWS FROM OPERATING ACTIVITIES Profit before income tax Adjustments for: Depreciation expense Amortization expense Expected credit loss (gain) Net gain on fair value changes of financial assets designated as at fair value through profit or loss Finance costs Interest income Dividend income Share of the profit of associates and joint ventures Loss (gain) on disposal of property, plant and equipment Net gain on investment Impairment loss recognized on financial assets Impairment loss recognized on non-financial assets Others Changes in operating assets and liabilities Notes receivable Notes receivable from related parties Accounts receivable Accounts receivable from related parties Other receivables Inventories Other current assets Notes payable Accounts payable Other payables Other current liabilities Other non-current liabilities Cash generated from operations Interest received Dividends received Interest paid Income taxes paid Net cash generated from operating activities

For the Nine Months Ended September 30

2021 2020 $ 3,665,052 $ 2,152,187 1,569,984 1,453,606 20,139 47,225 ( 4,847 ) 105,911 ( 10,623 ) ( 31,725 ) 219,602 295,468 ( 76,078 ) ( 83,671 ) ( 48,125 ) ( 34,252 ) ( 335,134 ) ( 212,558 ) ( 63,834 ) 7,529 ( 2,905 ) ( 104,966 ) - 85,581 132,848 58,006 ( 485 ) ( 13 ) ( 1,026,429 ) 435,153 ( 18,145 ) 23,462 ( 1,160,634 ) ( 92,165 ) ( 19,146 ) 40,570 ( 27,879 ) 147,557 ( 2,692,108 ) ( 7,774 ) ( 246,554 ) 87,501 265,845 314,490 783,671 ( 236,359 ) 2,871 ( 231,593 ) 105,316 316,720 ( 159,533) ( 32,860) 872,869 4,503,030 71,806 80,792 287,698 151,371 ( 203,323 ) ( 292,063 ) ( 861,267) ( 384,521) 167,783 4,058,609

(Continued)

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Eternal Materials Co., Ltd. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from disposal of financial assets at fair value through other comprehensive income Proceeds from the capital reduction of financial assets at fair value through other comprehensive income Purchase of financial assets at fair value through profit or loss Proceeds from disposal of financial assets at fair value through profit or loss Proceeds from disposal of subsidiary Proceeds from the capital reduction of the investee for using the equity method Payments for property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease in other receivables from related parties Payments for intangible assets Decrease in long-term lease receivables Increase in other financial assets Increase in other non-current assets Increase in other repayments Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase (decrease) in short-term borrowings Proceeds from issuance of bonds Proceeds from long-term borrowings Repayments of long-term borrowings Increase (decrease) in guarantee deposits received Repayment of the principal portion of lease liabilities Cash dividends Acquisition of additional interests in subsidiary Decrease in non-controlling interests Net cash used in financing activities EFFECTS OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS NET DECREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD

For the Nine Months Ended September 30

2021 2020 $ 84,697 $ - - 1,517 ( 1,507,103 ) ( 2,200,518 ) 1,430,619 680,225 - 150,216 - 72,202 ( 1,348,022 ) ( 1,082,961 ) 56,423 2,076 5,007 25 ( 7,750 ) ( 135,250 ) 25,526 31,554 ( 4,074 ) - ( 221,373 ) ( 18,259 ) ( 910) - (1,486,960) (2,499,173) 2,885,951 ( 240,247 ) 2,500,000 - 12,069,941 11,989,570 ( 14,491,489 ) ( 12,101,549 ) ( 12,190 ) 2,804 ( 66,282 ) ( 37,891 ) ( 1,860,419 ) ( 1,736,391 ) - ( 27,729 ) ( 18,599) ( 7,598) 1,006,913 (2,159,031) ( 251,277) ( 125,257) ( 563,541 ) ( 724,852 ) 6,108,294 6,009,646 $ 5,544,753 $ 5,284,794 (Concluded)

The accompanying notes are an integral part of the consolidated financial statements. (With Deloitte & Touche auditors’ review report dated November 5, 2021)

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Eternal Materials Co., Ltd. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise) (Reviewed, Not Audited)

1. GENERAL INFORMATION

Eternal Materials Co., Ltd. (the “Company”) was established in December 1964. The Company is mainly engaged in the research, manufacturing, processing, selling and trading of diversified industrial synthetic resins, epoxy resin, coating, molding compound, copper clad laminates, film materials, photoresist materials, electronic chemical materials, composite materials and bio-medical testing materials.

The Company’s shares have been listed on the Taiwan Stock Exchange (TWSE) since March 1994.

The consolidated financial statements are presented in the Company’s functional currency, the New Taiwan dollar.

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were reported by the Company’s board of directors and authorized for issue on November 5, 2021.

3. APPLICATION OF NEW AND AMENDED STANDARDS AND INTERPRETATIONS

• a. The application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC), (collectively, the “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC).

The application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the IFRSs endorsed and issued into effect by the FSC did not have material impact on the Company and its subsidiaries’ accounting policies.

• b. The IFRSs endorsed by the FSC for application starting from 2022

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Effective Date
New IFRSs Announced by IASB
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New IFRSs	Effective Date Announced by IASB
“Annual Improvements to IFRS Standards 2018-2020”	January 1, 2022 (Note 1)
Amendments to IFRS 3 “Reference to the Conceptual Framework”	January 1, 2022 (Note 2)
Amendments to IAS 16 “Property, Plant and Equipment - Proceeds	January 1, 2022 (Note 3)
before Intended Use”
Amendments to IAS 37 “Onerous Contracts - Cost of Fulfilling a	January 1, 2022 (Note 4)
Contract”

• Note 1: The amendments to IFRS 9 will be applied prospectively to modifications and exchanges of financial liabilities that occur on or after the annual reporting periods beginning on or after January 1, 2022. The amendments to IAS 41 “Agriculture” will be applied prospectively to the fair value measurements on or after the annual reporting periods beginning on or after January 1, 2022. The amendments to IFRS 1 “First-time Adoptions of IFRSs” will be applied

• 10 -

retrospectively for annual reporting periods beginning on or after January 1, 2022.

• Note 2: The amendments are applicable to business combinations for which the acquisition date is on or after the beginning of the annual reporting period beginning on or after January 1, 2022.

• Note 3: The amendments are applicable to property, plant and equipment that are brought to the location and condition necessary for them to be capable of operating in the manner intended by management on or after January 1, 2021.

• Note 4: The amendments are applicable to contracts for which the entity has not yet fulfilled all its obligations on January 1, 2022.

As of the date the consolidated financial statements were reported to the board of directors for issue, the Company and its subsidiaries are continuously assessing the possible impact that the application of other standards and interpretations will have on the Company and its subsidiaries’ financial position and financial performance and will disclose the relevant impact when the assessment is completed.

• c. New IFRSs in issue but not yet endorsed and issued into effect by the IASB

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Effective Date
New IFRSs Announced by IASB (Note 1)
----- End of picture text -----

New IFRSs	Effective Date Announced by IASB (Note 1)
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets	To be determined by IASB
between an Investor and its Associate or Joint Venture”
IFRS 17 “Insurance Contracts”	January 1, 2023
Amendments to IFRS 17	January 1, 2023
Amendments to IAS 1 “Classification of Liabilities as Current or	January 1, 2023
Non-current”
Amendments to IAS 1 “Disclosure of Accounting Policies”	January 1, 2023 (Note 2)
Amendments to IAS 8 “Definition of Accounting Estimates”	January 1, 2023 (Note 3)
Amendments to IAS 12 “Deferred Tax related to Assets and	January 1, 2023 (Note 4)
Liabilities arising from a Single Transaction”

• Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.

• Note 2: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.

• Note 3: The amendments are applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023.

• Note 4: Except that deferred taxes will be recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments will be applied prospectively to transactions that occur on or after January 1, 2022.

As of the date the consolidated financial statements were reported to the board of directors for issue, the Company and its subsidiaries are continuously assessing the possible impact that the application of other standards and interpretations will have on the Company and its subsidiaries’ financial position and financial performance and will disclose the relevant impact when the assessment is completed.

• 11 -

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Statement of compliance

The interim consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IAS 34 “Interim Financial Reporting” as endorsed and issued into effect by the FSC. Disclosure information included in these interim consolidated financial statements is less than the disclosure information required in a complete set of annual consolidated financial statements.

b. Basis of consolidation

The detailed information of subsidiaries (including the percentages of ownership and main businesses) is provided in Note 13 and Tables 8 and 9.

• c. Other significant accounting policies

Except for the following, refer to the summary of significant accounting policies and basis of preparation in the consolidated financial statements for the year ended December 31,2020.

1)Retirement Benefits.

Pension cost for an interim period is calculated on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior financial year, adjusted for significant market fluctuations since that time and for significant plan amendments, settlements, or other significant one-off events.

2)Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax. Interim period income taxes are assessed on an annual basis and calculated on an interim period’s pre-tax income by applying to the tax rate that would be applicable to expected total annual earnings.

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

The same critical accounting judgments and key sources of estimation uncertainty of consolidated financial statements have been followed in these consolidated financial statements as those applied in the preparation of the consolidated financial statements of the year ended December 31,2020.

6. CASH AND CASH EQUIVALENTS

Cash on hand Checking accounts and demand deposits Cash equivalents (investments with original maturities of three months or less) Time deposits	September 30, 2021 $ 42,734 3,733,494 1,768,525 $ 5,544,753	December 31, 2020 $ 11,413 2,841,405 3,255,476 $ 6,108,294	September 30, 2020	September 30, 2020
				$ 11,186 2,923,756 2,349,852 $ 5,284,794

7. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

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	September 30,	September 30,	September 30,	September 30,	December 31, September 30,	December 31, September 30,	December 31, September 30,	December 31, September 30,	December 31, September 30,	December 31, September 30,	December 31, September 30,
			2021				2020		2020
Financial assets－current
Hybrid financial assets
Structured deposits	$			77,578	$			- $ 1,541,253
Financial assets－non-current
Non-derivative financial assets
Mutual fund
Pacven Walden Ventures V, L.P.	$			13,314	$			21,301 $	26,509
ES, ACCOUNTS RECEIVABLE AND OTHER				RECEIVABLES
		September 30,				December 31,			September 30,
				2021				2020			2020
Notes receivable			$	6,164,667			$	5,138,238		$ 4,054,046
Notes receivable from related parties			$	62,884			$	44,739		$	33,576
Accounts receivable			$ 13,278,277				$	12,410,546		$ 10,812,832
Less: Allowance for loss		(		250,293	)	(		288,973)	(		274,663)
			$ 13,027,984				$	12,121,573		$ 10,538,169
Accounts receivable from related parties			$	238,820			$	219,674		$	191,210
Less: Allowance for loss		(		440	)	(		1,037)	(		14,099)
			$	238,380			$	218,637		$	177,111
Other receivables			$	770,671			$	806,213		$	821,477
Less: Allowance for loss		(		29,800	)	(		15,145)	(		21,151)
			$	740,871			$	791,068		$	800,326

8. NOTES, ACCOUNTS RECEIVABLE AND OTHER RECEIVABLES

• a. Notes receivable and accounts receivable

The notes and accounts receivable of the Company and its subsidiaries are measured at amortized cost. For the related credit management policies, refer to Note 31.

The loss allowance of the Company and its subsidiaries’ accounts receivable is recognized by using lifetime expected credit losses. The lifetime expected credit losses on accounts receivable are estimated using a provision matrix approach considering the past collection experience of the customers and an increase in late payments over the credit period.

• 13 -

The following table details the loss allowance of notes and accounts receivable based on the Company and its subsidiaries’ provision matrix.

September 30, 2021

Gross carrying amount Loss allowance (lifetime ECL) Amortized cost		Not Past Due $ 18,070,150 (12,402) $ 18,057,748		0 to 30 Days $ 973,474 (7,658) $ 965,816	31 to 90 Days $ 444,966 (16,330) $ 428,636		91 to 180 Days $ 54,675 (17,466) $ 37,209		Over 180 Days $ 201,383 (196,877) $ 4,506		Total
											$ 19,744,648 (250,733) $ 19,493,915

December 31, 2020

Gross carrying amount Loss allowance (lifetime ECL) Amortized cost		Not Past Due $ 15,766,467 (15,613) $ 15,750,854		0 to 30 Days $ 1,335,162 (9,468) $ 1,325,694	31 to 90 Days $ 423,402 (19,551) $ 403,851		91 to 180 Days $ 87,207 (50,270) $ 36,937		Over 180 Days $ 200,959 (195,108) $ 5,851		Total
											$ 17,813,197 (290,010) $ 17,523,187

September 30, 2020

Gross carrying amount Loss allowance (lifetime ECL) Amortized cost		Not Past Due $ 13,010,999 (15,183 ) $ 12,995,816		0 to 30 Days $ 1,256,760 (12,448) $ 1,244,312	31 to 90 Days $ 512,973 (31,246 ) $ 481,727		91 to 180 Days $ 112,128 (50,679) $ 61,449		Over 180 Days $ 198,804 (179,206 ) $ 19,598		Total
											$ 15,091,664 (288,762) $ 14,802,902

The movements of the loss allowance for doubtful accounts receivable were as follows:

Balance, beginning of the period Recognized (reversed) Written-off Effects of foreign currency exchange differences Balance, end of the period		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 290,010 (19,502) (15,097) (4,678) $ 250,733	2020 $ 221,717 84,760 (16,397) (1,318) $ 288,762

b. Other receivables

The Company and its subsidiaries’ allowance for loss are based on historical experience and current financial circumstances. The Company and its subsidiaries assessed that some of the other receivables could not be recovered. For the nine months ended September 30, 2021, the year ended December 31, 2020 and for the nine months ended September 30, 2020, the Company recognized loss allowance of NT$29,800 thousand, NT$15,145 thousand and NT$21,151 thousand, respectively.

• 14 -

9. INVENTORIES

Raw materials Supplies Finished goods Inventory in transit	September 30, 2021 $ 4,375,272 157,188 5,190,422 328,998 $10,051,880	December 31, 2020 $ 2,976,856 165,834 4,098,371 251,559 $ 7,492,620	September 30, 2020	September 30, 2020
				$ 2,592,973 168,344 4,155,028 240,913 $ 7,157,258

The cost of inventories recognized as operating costs for the three months and the nine months ended September 30, 2021 and 2020 was NT$10,324,806 thousand, NT$7,498,382 thousand, NT$29,279,907 thousand and NT$20,333,458 thousand, respectively, including write-down of inventories NT$22,212 thousand, NT$3,424 thousand, NT$132,848 thousand and NT$32,221 thousand, respectively.

10. LIABILITIES DIRECTLY ASSOCIATED WITH NON-CURRENT ASSETS HELD FOR SALE

In August, 2020, the Company’ board of directors resolved to dispose joint ventures, the Hangzhou Yongxinyang Photoelectric Materials Co., Ltd. which held by Eternal (China) Investment Co., Ltd. The joint ventures were reclassified as liabilities directly associated with non-current assets held for sale, and were presented separately in the consolidated balance sheets. The major classes of the assets and liabilities attributable to disposal groups as held for sale were as follows:

Credit balance of investments accounted for using the equity method	September 30, 2020	September 30, 2020
		$ 32,963

The net proceeds from the disposal exceed the carrying amount of the joint ventures. Accordingly, no impairment loss was recognized, as the joint ventures were reclassified as liabilities directly associated with non-current assets held for sale. The disposal was complete in October, 2020.

11. OTHER FINANCIAL ASSETS - CURRENT

Time deposits with original maturities of more than three months	September 30, 2021 $ 62,855	December 31, 2020 $ 61,860	September 30, 2020 $ 66,950

• 15 -

12. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME - NON-CURRENT

Domestic investments Listed shares President Securities Corp. Unlisted shares Universal Venture Capital Investment Corp. Universal Development & Investment Capital I Co., Ltd. Der Yang Biotechnology Venture Capital Co., Ltd. Foreign investments Listed shares TBG Diagnostics Limited (TBG stocks) Unlisted shares Grace THW Holdings Limited TBG Diagnostics Limited (TBG stocks)	September 30, 2021 $ 767,436 40,644 - 4,316 812,396 - 179,923 40,341 220,264 $ 1,032,660	September 30, 2021 $ 767,436 40,644 - 4,316 812,396 - 179,923 40,341 220,264 $ 1,032,660	December 31, 2020 $ 642,849 32,602 - 3,769 679,220 185,302 151,784 - 337,086 $ 1,016,306	September 30, 2020	September 30, 2020
					$ 543,277 31,497 19,427 3,804 598,005 174,876 155,201 - 330,077 $ 928,082

The TBG stocks delisted from the Australian Securities Exchange (ASX) on August 2021. These investments in equity instruments are not held for trading. Instead, they are held for medium to long-term strategic purposes. Accordingly, the management elected to designate these investments in equity instruments as at FVTOCI as they believe that recognizing short-term fluctuations in these investments’ fair value in profit or loss would not be consistent with the Company and its subsidiaries’ strategy of holding these investments for long-term purposes.

13. SUBSIDIARIES

a. Subsidiaries included in the consolidated financial statements were as follows:

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Percentage of Ownership (%)
September December 31, September Additional
Investor Investee Main Businesses 30, 2021 2020 30, 2020 Descriptions
The Company Eternal Holdings Inc. International investment 100 100 100 1)
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Investor Investee The Company Eternal Holdings Inc.	Main Businesses International investment	30, 2021 100	2020 100	30, 2020 100	Descriptions 1)
Eternal Global (BVI) Co., Ltd.	International investment	100	100	100	1)
Mixville Holdings Inc.	International investment	100	100	100	1)
CHOU-KOU Materials Co., Ltd.	Selling, trading and providing services	100	100	100	1)
	of resins material, electronic material
	and other related products
Nikko-Materials Co., Ltd.	Manufacturing and selling of dry film	100	100	100	1)
	photoresist and vacuum laminator
Eternal Electronic Material (Thailand) Co., Ltd.	Trading services, cutting and selling of	75	75	75	1)
	dry film photoresist
New E Materials Co., Ltd.	Researching, developing, manufacturing	62.80	62.80	62.80	1)
	and selling of photoelectric,
	semiconductor process related
	electronic chemical materials and
	equipment spare parts

(Continued)

• 16 -

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Percentage of Ownership (%)
September December 31, September Additional
Investor Investee Main Businesses 30, 2021 2020 30, 2020 Descriptions
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Investor	Investee	Main Businesses	30, 2021	2020	30, 2020	Descriptions
	Elga Europe S.r.l.	Manufacturing, selling, agency and	72.68	72.68	72.68	1)
		processing of electronic chemical
		products
Eternal Global (BVI) Co., Ltd.	Eternal Chemical (China) Co., Ltd	Manufacturing and selling of resins	100	100	100
		material and processing products
	Changhe International Trading (GZFTZ) Co.,	International trading, commercial	-	100	100	1) and 4)
	Ltd.	trading, entrepot trading, products
		displayed, bonded warehousing and
		business consulting services
Eternal Holdings Inc.	Eternal International (BVI) Co., Ltd.	International investment	100	100	100	1)
	E-Chem Corp.	International investment	100	100	100	1)
	Eternal Nanyang Investment Co., Ltd.	International investment	90	90	90	1)
	PT Eternal Materials Indonesia	Selling, trading of chemical	67	-	-	1) and 2)
Eternal International (BVI) Co.,	Eternal Technology Corporation	Manufacturing and selling of photoresist	100	100	100	1)
Ltd.
	Eternal (China) Investment Co., Ltd.	Managing, investing consulting services,	100	100	100	1)
		researching, leasing, manufacturing
		and selling of resins material and
		photoelectric chemical materials
E-Chem Corp.	Eternal Specialty Materials (Zhuhai) Co., Ltd.	Manufacturing and selling of acrylic	90	90	90
		resin and methacrylic acid
Eternal Nanyang Investment	Eternal Materials (Malaysia) Sdn. Bhd.	Manufacturing, selling, trading and	100	100	100	1)
Co., Ltd.		providing services of resins material
		related products
Mixville Holdings Inc.	High Expectation Limited	International investment	100	100	100	1)
High Expectation Limited	Eternal Materials (Guangdong) Co., Ltd.	Manufacturing and selling of adhesives,	100	100	100	1)
		resins material and processing of
		products
Eternal (China) Investment Co.,	Eternal Optical Material (Suzhou) Co., Ltd.	Manufacturing and selling of optical film	100	100	100	1)
Ltd.
	Eternal Photoelectric Material Industry	Researching, developing and	100	100	100	1)
	(Yingkou) Co., Ltd.	manufacturing of photoresist dry film,
		liquid photo imaginable solder masks
		and printed circuit board related
		materials
	Eternal Synthetic Resins (Changshu) Co., Ltd.	Manufacturing and selling of unsaturated	100	100	100	1)
		polyester resin
	Eternal Chemical (Chengdu) Co., Ltd.	Researching and developing resins	100	100	100	1)
		material and products
	Eternal Electronic (Suzhou) Co., Ltd.	Researching, developing, and	100	100	100
		manufacturing of dry film photoresist
		and dry film solder mask which used
		in electronic materials, researching
		resin materials and selling, providing
		after sales service of self-produced
		products
	Eternal Electronic Material (Guangzhou) Co.,	Coating, slitting, cutting, processing, and	100	100	100
	Ltd.	selling of photoresist
	Eternal Photo Electronic Materials (Guangzhou)	Researching, developing, manufacturing	100	100	100
	Co., Ltd.	and selling of electronic high-tech
		chemical and related products
	Eternal Sun A. (Suzhou) Co., Ltd.	Researching, developing, and	60	60	60	1)
		manufacturing of optical protective
		film which used in display, and
		selling, providing after sales service
		of self-produced products
	Eternal Chemical (Tianjin) Co., Ltd.	Manufacturing and selling of adhesives,	100	100	100	1)
		resins material and processing
		products
	Eternal Specialty Materials (Suzhou) Co., Ltd.	Researching and developing chemical	100	100	100	1)
		products, and selling, providing
		technical services of self-produced
		products
	Elga Europe S.r.l.	Manufacturing, selling, agency and	22.32	22.32	22.32	1)
		processing of electronic chemical
		products
	Eternal Material Industry (Tongling) Co., Ltd.	Manufacturing, selling, trading and	100	-	-	1) and 3)
		providing technical services of resins
		material related products
Nikko-Materials Co., Ltd.	Nikko Mechanics Co., Ltd.	Designing, manufacturing, selling of	100	100	100	1)
		industrial machinery and machine
		tool
						(Concluded)

• 1) This is an immaterial subsidiary for which the consolidated financial statements are not reviewed by the Company’s independent auditors.

• 17 -

• 2) The company was established as a new subsidiary in January 2021.

• 3) The company was established as a new subsidiary in August 2021.

• 4) The divestment was resolved by the board of directors in March 2021, and the liquidation was completed in September 2021.

• b. The Company and its subsidiaries did not have any subsidiary with material non-controlling interests.

14. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Investments accounted for using the equity method Investments in associates Credit balance of investments accounted for using the equity method(recorded as other non-current liabilities) Investments in associates		September 30, 2021 $ 2,439,182 $ 23,833 )		December 31, 2020 $ 2,306,731 $ 14,095 )		September 30, 2020
	(		(		(	$ 2,224,655 $ 12,408 )

• a. Investments accounted for using the equity method

Investments in associates

Associates that are not individually material	September 30, 2021 $ 2,439,182		December 31, 2020 $ 2,306,731	September 30, 2020 $ 2,224,655

Information about associates that are not individually material was as follows:

The Company and its subsidiaries’ share of Net profit for the period Other comprehensive income for the period Total comprehensive income for the period		For the Three Months Ended September 30 2021 2020 $ 111,429 $ 102,025 ( 4,920) 17,563 $ 106,509 $ 119,588		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 111,429 ( 4,920) $ 106,509		2021 $ 345,229 ( 29,486) $ 315,743	2020 $ 229,489 ( 17,235) $ 212,254

Fair values (Level 1) of investments in associates with available published price quotation are summarized as follows:

Daxin Materials Corporation		September 30, 2021 $ 2,084,719		December 31, 2020 $ 2,005,078		September 30, 2020 $ 1,871,563

• 18 -

Polymer Instrumentation and Consulting Services, Ltd.（Polymics Ltd.）, an associate, is affected by the economic environment, and has no future economic benefits after evaluation, the Company and its subsidiaries recognized an impairment loss of $85,581 thousand in August, 2020.

The Company and its subsidiaries held 50% ownership of DSM Eternal Resins (Kunshan) Co., Ltd., but had no control over it. Therefore, DSM Eternal Resins (Kunshan) Co., Ltd. was not included in the consolidated financial statements.

b. Credit balance of investments accounted for using the equity method

Associates that are not individually material	September 30, 2021 ( $ 23,833 )	December 31, 2020 ( $ 14,095 )	September 30, 2020 ( $ 12,408 )

Information about associates and joint ventures that are not individually material was as follows:

The Company and its subsidiaries’ share of Net loss for the period Other comprehensive income for the period Total comprehensive loss for the period		For the Three Months Ended September 30 2021 2020 ($ 2,923) ($ 4,495) 78 ( 605) ($ 2,845) ($ 5,100)		For the Nine Months Ended September 30	For the Nine Months Ended September 30
				2021 ($ 10,095) 357 ($ 9,738)	2020 ($ 16,931) 155 ($ 16,776)

The Company and its subsidiaries’ share of losses of the associates and joint ventures exceeded their interests in those associates and joint ventures. After reducing their equity to zero, the Company and its subsidiaries recognized additional losses only to the extent that they have incurred legal obligations or constructive obligations, or made payments on behalf of those associates and joint ventures and transferred them to the credit balance of investments accounted for using the equity method (recorded as other non-current liabilities).

For the nine months ended September 30, 2021 and 2020, the Company and its subsidiaries’ investments accounted for using the equity method (including credit balance) are based on the associates’ financial statements which have not been reviewed for the same period.

Refer to Tables 8 and 9 for the main businesses and countries of incorporation of the associates and joint ventures.

• 19 -

15. PROPERTY, PLANT AND EQUIPMENT

For the Nine Months Ended September 30, 2021

Carrying amount at January 1, 2021 Cost		Land		Buildings		Machinery and Equipment		Storage Equipment		Examination Equipment		Other Equipment	E	Construction in Progress and quipment to be Inspected		Total
		$ 2,680,444 $ 2,680,444 2,979 (4,249 ) - (15,041) $ 2,664,133 $ - - - - - $ - $ 2,664,133		$ 5,362,540 $ 11,323,614 238,802 (37,779) 15,710 (178,914) $ 11,361,433 $ 5,961,074 408,510 (33,971) 713 (81,785) $ 6,254,541 $ 5,106,892		$ 6,273,237 $ 21,620,157 728,722 (109,157) - (297,712) $ 21,942,010 $ 15,346,920 843,086 (97,320) - (216,240) $ 15,876,446 $ 6,065,564		$ 656,418 $ 1,559,720 47,832 (18,951) - (18,766) $ 1,569,835 $ 903,302 54,028 (17,886 ) - (731) $ 938,713 $ 631,122		$ 541,695 $ 1,644,996 89,330 (37,339) - (9,344) $ 1,687,643 $ 1,103,301 92,015 (34,156) - (5,719) $ 1,155,441 $ 532,202		$ 358,188 $ 902,637 55,289 (13,742 ) - (23,082) $ 921,102 $ 544,449 60,249 (10,766 ) - (15,472) $ 578,460 $ 342,642		$ 750,528 $ 750,528 81,467 - - (7,053) $ 824,942 $ - - - - - $ - $ 824,942		$ 16,623,050 $ 40,482,096 1,244,421 (221,217) 15,710 (549,912) $ 40,971,098 $ 23,859,046 1,457,888 (194,099) 713 (319,947) $ 24,803,601 $ 16,167,497
Balance at January 1, 2021 Additions Disposals Transferred from investment properties Effect of foreign currency exchange difference Balance at September 30, 2021 Accumulated depreciation and impairment
Balance at January 1, 2021 Depreciation Disposals Transferred from investment properties Effect of foreign currency exchange difference Balance at September 30, 2021 Carrying amount at September 30, 2021

For the Nine Months Ended September 30, 2020

Carrying amount at January 1, 2020 Cost		Land		Buildings		Machinery and Equipment		Storage Equipment		Examination Equipment		Other Equipment	E	Construction in Progress and quipment to be Inspected		Total
		$ 2,713,753 $ 2,713,753 1,190 - (43,451 ) - - - 3,530 $ 2,675,022 $ - - - - - - - - $ - $ 2,675,022		$ 5,715,567 $ 11,180,745 377,875 (109,256 ) (170,165 ) - (70,634 ) 9,651 (87,403) $ 11,130,813 $ 5,465,178 391,534 (9,974 ) (16,718 ) 3,589 (46,629 ) 8,137 (26,672) $ 5,768,445 $ 5,362,368		$ 6,297,691 $ 20,587,401 719,805 (97,040 ) - - (34,470) 3,521 (131,902) $ 21,047,315 $ 14,289,710 783,544 (89,540 ) - 20,135 (26,346) 59 (58,911) $ 14,918,651 $ 6,128,664		$ 667,141 $ 1,500,221 49,902 (4,106 ) - - (378 ) - (12,128) $ 1,533,511 $ 833,080 52,571 (3,162 ) - 37 (340 ) - (3,569) $ 878,617 $ 654,894		$ 472,136 $ 1,475,283 124,336 (9,655 ) - - (26) - (3,625) $ 1,586,313 $ 1,003,147 82,371 (9,500 ) - - (23) - (1,751) $ 1,074,244 $ 512,069		$ 363,704 $ 862,673 72,555 (25,622 ) - - (13,550 ) (13,172 ) (5,810) $ 877,074 $ 498,969 52,623 (8,985 ) - 1,629 (10,985) (8,196) (2,850) $ 522,205 $ 354,869		$ 1,205,554 $ 1,205,554 (353,321 ) (1,274 ) - (327 ) - - (15,951) $ 834,681 $ - - - - - - - - $ - $ 834,681		$ 17,435,546 $ 39,525,630 992,342 (246,953 ) (213,616 ) (327 ) (119,058 ) - (253,289) $ 39,684,729 $ 22,090,084 1,362,643 (121,161 ) (16,718 ) 25,390 (84,323 ) - (93,753) $ 23,162,162 $ 16,522,567
Balance at January 1, 2020 Additions Disposals Transferred to investment properties Impairment loss Disposal of subsidiaries Reclassification Effect of foreign currency exchange difference Balance at September 30, 2020 Accumulated depreciation and impairment
Balance at January 1, 2020 Depreciation Disposals Transferred to investment properties Impairment loss Disposal of subsidiaries Reclassification Effect of foreign currency exchange difference Balance at September 30, 2020 Carrying amount at September 30, 2020

Considering future economic benefits, the plant, machinery and other equipment of Nikko-Materials Co., Ltd. which were expected to use for production have been evaluated the present value of the cash flow generated from operations at a discount rate of 5.95% as a recoverable amount. According to the assessment, the recoverable amount was less than the carrying amount. For the year 2020, the impairment loss of $25,785 thousand (including the impairment loss of intangible assets of $68 thousand) was recognized in the current year (recorded as other gains and losses).

The above items of property, plant and equipment are depreciated on a straight-line basis over the following useful lives:

Buildings	5-50 years
Machinery and equipment	3-20 years
Storage equipment	5-20 years
Examination equipment	5-15 years
Other equipment	3-12 years

• 20 -

Refer to Note 33 for the amounts of property, plant and equipment pledged by the Company and its subsidiaries as collateral for bank borrowings.

Land (including those recorded as investment properties) held by the Company was revalued in 1980, 1990, 1997 and 2004, and as of September 30, 2021, December 31, 2020 and September 30, 2020, the revaluation increments of the land was $1,973,324 thousand, $1,977,218 thousand and $1,977,218 thousand, respectively.

16. LEASE ARRANGEMENTS

a. Right-of-use assets

Additions to right-of-use assets Depreciation charge for right-of-use assets Land Buildings Machinery Storage equipment Other equipment Carrying amounts Land Buildings Machinery Storage equipment Other equipment		$ For the Three Months Ended September 30 2021 2020 $ 5,301 $ 5,303 14,224 12,335 3,636 4,170 205 17 2,346 2,811 $ 25,712 $ 24,636 September 30, 2021 December 31, 2020 $ 840,630 $ 871,970 171,754 214,559 78,411 83,674 3,659 957 19,072 24,375 $ 1,113,526 $ 1,195,535	$ For the Three Months Ended September 30 2021 2020 $ 5,301 $ 5,303 14,224 12,335 3,636 4,170 205 17 2,346 2,811 $ 25,712 $ 24,636 September 30, 2021 December 31, 2020 $ 840,630 $ 871,970 171,754 214,559 78,411 83,674 3,659 957 19,072 24,375 $ 1,113,526 $ 1,195,535	$ For the Three Months Ended September 30 2021 2020 $ 5,301 $ 5,303 14,224 12,335 3,636 4,170 205 17 2,346 2,811 $ 25,712 $ 24,636 September 30, 2021 December 31, 2020 $ 840,630 $ 871,970 171,754 214,559 78,411 83,674 3,659 957 19,072 24,375 $ 1,113,526 $ 1,195,535		December 31, 2020	December 31, 2020	December 31, 2020	December 31, 2020	For the Nine Month Ended September 30 September 30, 2020 $ 855,888 159,716 77,336 1,008 25,860 $ 1,119,808	For the Nine Month Ended September 30 September 30, 2020 $ 855,888 159,716 77,336 1,008 25,860 $ 1,119,808
								$		2021 2020 47,996 $ 172,556 For the Nine Months Ended September 30
			2021 $ 5,301 14,224 3,636 205 2,346 $ 25,712	2020 $ 5,303 12,335 4,170 17 2,811 $ 24,636						2021 $ 16,059 43,666 12,006 376 7,368 $ 79,475	2020 $ 15,966 32,702 8,324 17 7,765 $ 64,774

In addition, part of the land use rights for land located in mainland China is subleased under operating leases, and the relevant right-of-use assets are recorded as investment properties, refer to Note 17 for the details.

b. Lease liabilities

Carrying amounts Current Non-current	September 30, 2021 $ 76,034 $ 212,967	December 31, 2020 $ 81,002 $ 262,898	September 30, 2020	September 30, 2020
				$ 55,125 $ 221,801

• 21 -

Range of discount rate (%) for lease liabilities was as follows:

Land Buildings Machinery Storage equipment Other equipment	September 30, 2021 0.93～6.66 0.63～5.04 3.71 1.63～1.67 0.63～3.64	December 31, 2020 0.93～6.66 0.79～9.00 2.70 1.67 0.86～5.35	September 30, 2020
			0.93～6.66 0.86～9.00 1.67～4.40 1.67 0.86～5.35

• c. Material lease activities and terms

Major lease arrangements of the Company’s subsidiaries are land use rights contracts with original lease terms of 50 to 56 years.

d. Other lease information

For the Three Months Ended September 30 2021 2020 Expenses relating to short-term and low-value asset leases $ 9,933 $ 6,374 Total cash outflow for all lease arrangements (including short-term and low-value asset leases)		For the Three Months Ended September 30	For the Three Months Ended September 30	For the Three Months Ended September 30
			2020 $ 6,374
					2021 $ 94,581	2020 $ 59,021

17. INVESTMENT PROPERTIES

For the Nine Months Ended September 30, 2021

Carrying amount at January 1, 2021 Cost Balance at January 1, 2021 Additions Transferred to property, plant and equipment Transferred to right-of-use assets Effects of foreign currency exchange differences Balance at September 30, 2021		Land $ 59,827 $ 59,827 355 - - (4,226) $ 55,956		Buildings $ 1,227,604 $ 1,407,484 34,174 (15,710) - (30,737) $ 1,395,211		Right-of-use Assets $ 69,390 $ 73,714 - - (847) (1,375) $ 71,492		Total
								$ 1,356,821 $ 1,541,025 34,529 (15,710) (847) (36,338) $ 1,522,659 (Continued)

• 22 -

Land Accumulated depreciation and impairment Balance at January 1, 2021 $ - Depreciation - Transferred to property, plant and equipment - Transferred to right-of-use assets - Effects of foreign currency exchange differences - Balance at September 30, 2021 $ - Carrying amount at September 30, 2021 $ 55,956 For the Nine Months Ended September 30, 2020 Land Carrying amount at January 1, 2020 $ 17,057 Cost Balance at January 1, 2020 $ 17,057 Transferred from property, plant and equipment 43,451 Effects of foreign currency exchange differences (789) Balance at September 30, 2020 $ 59,719 Accumulated depreciation and impairment Balance at January 1, 2020 $ - Depreciation - Transferred from property, plant and equipment - Effects of foreign currency exchange differences - Balance at September 30, 2020 $ - Carrying amount at September 30, 2020 $ 59,719	Land Accumulated depreciation and impairment Balance at January 1, 2021 $ - Depreciation - Transferred to property, plant and equipment - Transferred to right-of-use assets - Effects of foreign currency exchange differences - Balance at September 30, 2021 $ - Carrying amount at September 30, 2021 $ 55,956 For the Nine Months Ended September 30, 2020 Land Carrying amount at January 1, 2020 $ 17,057 Cost Balance at January 1, 2020 $ 17,057 Transferred from property, plant and equipment 43,451 Effects of foreign currency exchange differences (789) Balance at September 30, 2020 $ 59,719 Accumulated depreciation and impairment Balance at January 1, 2020 $ - Depreciation - Transferred from property, plant and equipment - Effects of foreign currency exchange differences - Balance at September 30, 2020 $ - Carrying amount at September 30, 2020 $ 59,719		Buildings $ 179,880 31,032 (713) - (4,943) $ 205,256 $ 1,189,955 Buildings $ 1,024,946 $ 1,147,244 170,165 (9,436) $ 1,307,973 $ 122,298 24,612 16,718 (1,229) $ 162,399 $ 1,145,574		Right-of-use Assets $ 4,324 1,589 - (50) (96) $ 5,767 $ 65,725 Right-of-use Assets $ 70,374 $ 72,501 - (606) $ 71,895 $ 2,127 1,577 - (14) $ 3,690 $ 68,205		Total $ 184,204 32,621 (713) (50) (5,039) $ 211,023 $ 1,311,636 Total $ 1,112,377 $ 1,236,802 213,616 (10,831) $ 1,439,587 $ 124,425 26,189 16,718 (1,243) $ 166,089 $ 1,273,498 (Concluded)
Carrying amount at January 1, 2020 Cost Balance at January 1, 2020 Transferred from property, plant and equipment Effects of foreign currency exchange differences Balance at September 30, 2020 Accumulated depreciation and impairment Balance at January 1, 2020 Depreciation Transferred from property, plant and equipment Effects of foreign currency exchange differences Balance at September 30, 2020 Carrying amount at September 30, 2020

The investment properties were leased for terms of 2 to 15 years.

• 23 -

The maturity analysis of lease payments receivable under operating leases of investment properties is as follows:

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 onwards	September 30, 2021 $ 254,586 141,826 125,652 84,580 88,453 316,756 $ 1,011,853		December 31, 2020	September 30, 2020 $ 251,101 244,977 130,992 119,395 83,318 402,825 $ 1,232,608	September 30, 2020 $ 251,101 244,977 130,992 119,395 83,318 402,825 $ 1,232,608
			$ 259,117 221,217 136,481 112,848 84,540 390,794 $ 1,204,997		$ 251,101 244,977 130,992 119,395 83,318 402,825 $ 1,232,608

The fair value of main part of the subsidiaries’ right-of-use assets and buildings located in China was evaluated by independent appraisers, and the rest which was reference to market evidence of transaction prices for similar properties and using income approach was evaluated by the management of the Company. The Company measured the fair value by using Level 3. The fair values were as follows.

Fair value	September 30, 2021 $ 3,061,453		December 31, 2020 $ 3,027,121	September 30, 2020 $ 2,988,890

The following items of investment properties are depreciated on a straight-line basis over their useful lives as follow:

Buildings 20-50 years Right-of-use assets 34-36 years

Operating income and expenses directly related to investment properties

Rental income Operating expenses directly related to investment properties		For the Three Months Ended September 30 2021 2020 $ 71,925 $ 77,271 $ 33,768 $ 30,091	For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 71,925 $ 33,768	2021 $ 214,547 $ 91,664	2020 $ 191,029 $ 75,550

18. INTANGIBLE ASSETS

For the Nine Months Ended September 30, 2021

Carrying amount at January 1, 2021 Cost Balance at January 1, 2021 Additions Disposals Effects of foreign currency exchange differences Balance at September 30, 2021		Goodwill		Expertise $ - $ 127,513 - - - $ 127,513	Customer Relationships $ - $ 104,038 - - - $ 104,038		Computer Software $ 223,655 $ 239,226 6,655 - - $ 245,881		Others Total $ 19,688 $ 282,235 $ 143,163 $ 689,832 1,095 7,750 (14,281) (14,281) (26,870) (30,713) $ 103,107 $ 652,588 (Continued)		Total
		$ 38,892 $ 75,892 - - (3,843) $ 72,049

• 24 -

Accumulated amortization and impairment Balance at January 1, 2021 Amortization expense Disposals Effects of foreign currency exchange differences Balance at September 30, 2021 Carrying amount at September 30, 2021		Goodwill $ 37,000 - - - $ 37,000 $ 35,049		Expertise $ 127,513 - - - $ 127,513 $ -	Customer Relationships $ 104,038 - - - $ 104,038 $ -		Computer Software $ 15,571 11,431 - - $ 27,002 $ 218,879		Others $ 123,475 6,611 (14,281) (26,285) $ 89,520 $ 13,587		Total
											$ 407,597 18,042 (14,281) (26,285)
											$ 385,073 $ 267,515

(Concluded)

For the Nine Months Ended September 30, 2020

Carrying amount at January 1, 2020 Cost Balance at January 1, 2020 Additions Disposals Effects of foreign currency exchange differences Balance at September 30, 2020 Accumulated amortization and impairment Balance at January 1, 2020 Amortization expense Impairment loss Disposals Effects of foreign currency exchange differences Balance at September 30, 2020 Carrying amount at September 30, 2020		Goodwill $ 75,850 $ 75,850 - - (56) $ 75,794 $ - - - - - $ - $ 75,794		Expertise $ 87,370 $ 127,513 - - - $ 127,513 $ 40,143 10,626 - - - $ 50,769 $ 76,744	Customer Relationships $ 61,927 $ 104,038 - - - $ 104,038 $ 42,111 11,147 - - - $ 53,258 $ 50,780		Computer Software $ 78,254 $ 82,736 134,106 - - $ 216,842 $ 4,482 7,099 - - - $ 11,581 $ 205,261		Others $ 40,381 $ 128,722 1,144 (165) 4,950 $ 134,651 $ 88,341 16,826 68 (165) 4,907 $ 109,977 $ 24,674		Total
											$ 343,782 $ 518,859 135,250 (165) 4,894 $ 658,838 $ 175,077 45,698 68 (165) 4,907 $ 225,585 $ 433,253

The Company and its subsidiaries will test the recoverable amount of intangible assets at the end of the annual financial reporting period.

The subsidiary Elga Europe S.r.l. tested the recoverable amount of intangible assets (including goodwill, expertise and customer relationships, etc.) for annual financial reporting periods ending on December 31, 2020. The recoverable amount is based on the cash flow generated from operations at a discount rate of 7.21%. According to the assessment, the recoverable amount was less than the carrying amount. Therefore, an impairment loss of $162,055 thousand was recognized.

Intangible assets are amortized on a straight-line basis over their estimated useful lives as follows:

Expertise	9 years
Customer relationships	7 years
Computer software	2-20 years
Other intangible assets	3-20 years

• 25 -

19. FINANCE LEASE RECEIVABLES

The lease period of the Company and its subsidiaries for house decoration, machinery and equipment lease contracts is ten years, and the implicit interest rate of the lease is 4.84% - 6.23%. The Company and its subsidiaries entered into a lease agreement with an associate Allnex - Eternal Resins (Guangdong) Co., Ltd. for the leasing out of machinery and equipment for ten years, and the implicit interest rate in the lease was 6.23%. This agreement was deemed as a sale agreement. The gain on disposal will be deferred and subsequently recognized as profit over the lease term. As of September 30, 2021, December 31, 2020 and September 30, 2020, the balance of finance lease receivables generated from the aforementioned transactions was $27,647 thousand, $38,012 thousand, and $36,475 thousand, respectively.

The Company and its subsidiaries measured the loss allowance of the finance lease receivables based on lifetime expected credit losses. As of September 30, 2021, December 31, 2020 and September 30, 2020, no loss allowance was recognized.

The composition of finance lease receivables (including related parties) is as follows:

Undiscounted lease payments Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 onwards Less: Unearned financial income Finance lease receivable (recorded as other non-current assets - others)	September 30, 2021 $ 25,852 26,768 18,595 18,504 18,412 62,214 170,345 ( 29,023) $ 141,322	December 31, 2020 $ 27,750 27,284 26,817 18,860 18,767 76,392 195,870 ( 34,846) $ 161,024	September 30, 2020	September 30, 2020
	(	(	(	$ 25,700 27,066 26,610 18,486 18,395 78,809 195,066 36,057) $ 159,009

20. BORROWINGS

a. Short-term borrowings

==> picture [463 x 238] intentionally omitted <==

----- Start of picture text -----

Interest Rate
Type of Borrowings Range (%) Amount
September 30, 2021
Mortgage secured loans 2.31-3.35 $ 301,400
Unsecured loans 0.58-3.71 5,114,355
Purchase loans 1.12-2.95 461,794
Secured loans 1.00-3.28 1,361,515
$ 7,239,064
December 31, 2020
Mortgage secured loans 0.00-3.30 $ 271,782
Unsecured loans 0.68-3.71 2,607,208
Purchase loans 1.13-3.10 219,393
Secured loans 1.00-4.35 1,305,546
$ 4,403,929
(Continued)
----- End of picture text -----

• 26 -

==> picture [494 x 492] intentionally omitted <==

----- Start of picture text -----

Interest Rate
Type of Borrowings Range (%) Amount
September30, 2020
Mortgage secured loans 0.57-3.12 $ 239,087
Unsecured loans 0.72-3.50 1,875,655
Purchase loans 3.40-4.35 147,082
Secured loans 1.00-4.35 1,865,748
$ 4,127,572
(Concluded)
b. Long-term borrowings
Agreement Period
and Interest Payable Interest Rate
Type of Borrowings Schedule Range (%) Amount
September 30, 2021
Mortgage secured loans From December 17, 2010 0.86-1.75 $ 54,029
to December 31, 2025.
Interest is paid based
on schedule.
Secured loans From September 17, 1.08-1.43 1,581,915
2020 to November 25,
2025. Interest is paid
based on schedule.
Unsecured loans From September 11, 0.60-3.85 8,288,346
2017 to September 29,
2024. Interest is paid
based on schedule.
9,924,290
Less: Current portion of (3,223,745)
long-term borrowings
$ 6,700,545
December 31, 2020
Mortgage secured loans From December 17, 2010 0.86-2.70 $ 80,874
to December 31, 2025.
Interest is paid based
on schedule.
(Continued)
----- End of picture text -----

• 27 -

Type of Borrowings Secured loans Unsecured loans Long-term bills payable Commercial paper Less: Unamortized discounts Less: Current portion of long-term borrowings September 30, 2020 Mortgage secured loans Secured loans Unsecured loans	Agreement Period and Interest Payable Schedule From September 17, 2018 to November 25, 2025. Interest is paid based on schedule. From July 28, 2016 to October 2, 2023. Interest is paid based on schedule. Revolving credit, the period of the agreement is five years. Maturity date is May 2023. Only banking surcharge and interests have to be paid before the maturity date. From December 17, 2010 to December 31, 2025. Interest is paid based on schedule. From September 17, 2018 to September 17, 2021. Interest is paid based on schedule. From July 28, 2016 to October 2, 2023. Interest is paid based on schedule.	Interest Rate Range (%) 1.16-1.50 0.60-3.85 1.28 0.86-2.70 1.20-4.10 0.60-3.85		Amount
				$ 1,599,100 9,821,886 11,501,860 900,000 (568) 899,432 12,401,292 (2,211,266) $ 10,190,026 $ 86,236 1,950,270 10,353,102 12,389,608 (Continued)

• 28 -

==> picture [463 x 276] intentionally omitted <==

----- Start of picture text -----

Agreement Period
and Interest Payable Interest Rate
Type of Borrowings Schedule Range (%) Amount
Long-term bills payable
Commercial paper Revolving credit, the 1.29-1.30 $ 900,000
period of the
agreement is five
years. Maturity date is
May 2023. Only
banking surcharge and
interests have to be
paid before the
maturity date.
Less: Unamortized discounts (639)
899,361
13,288,969
Less: Current portion of (2,204,211)
long-term borrowings
$ 11,084,758
----- End of picture text -----

(Concluded)

The above commercial paper was issued by Taiwan Cooperative Bills Finance Corporation and International Bills Finance Corporation and guaranteed by a syndicated credit line from 8 banks led by E.SUN Commercial Bank, Ltd.

• c. Facility agreements and financial covenants

• 1) During the period of the credit facility agreements, the Company and its subsidiaries made agreements with the creditors that the current ratio, liability ratio, interest coverage ratio and net tangible assets of the consolidated financial statements will be maintained within a certain specified ratio or amount and reviewed at least once half a year or a year. If the Company or its subsidiaries breach these clauses, the bank and syndicated banks can cancel the credit line or declare that part or all of the loan together with accrued interest immediately due. As of June 30, 2021 and December 31, 2020,the Company was in compliance with the syndicated credit facility agreements based on its consolidated financial statements .

• 2) As of September 30, 2021, the Company and its subsidiaries utilized the credits under signed facility agreements of the following banks.

==> picture [443 x 14] intentionally omitted <==

----- Start of picture text -----

Bank Currency Credit line
----- End of picture text -----

Bank	Currency	Credit line
Bank SinoPac Co., Ltd.	NTD	$ 1,200,000
HSBC Bank (Taiwan) Limited	NTD	600,000
Far Eastern International Bank Co., Ltd.	NTD	300,000
Taipei Fubon Commercial Bank Co., Ltd.	EUR	5,000

• 3) As of September 30, 2021, the Company and its subsidiaries executed syndicated credit facility agreements with the following banks.

In November, 2020, the subsidiary entered into a syndicated credit facility agreement with 5 banks led by Taipei Fubon Commercial Bank Co., Ltd. for a USD $50,000 thousand credit line; the proceeds are

• 29 -

for expanding medium-term working capital and increase capital to repay the subsidiaries’ existing liabilities.

In November 2017, the Company entered into a syndicated credit facility agreement with 8 banks led by E.SUN Commercial Bank, Ltd. for a NT$4,200,000 thousand credit line; the proceeds are for repaying liabilities and expanding medium-term working capital.

• 4) Refer to Note 33 for the assets pledged as collateral for bank borrowings of the Company and its subsidiaries.

• d. Bonds Payable

5 year secured bonds - issued at par value Issued in November 2019. Interest at 0.82%, bullet repayment, payable annually. Less: Issuance cost 5 year secured bonds - issued at par value Issued in August 2021. Interest at 0.58%, bullet repayment, payable annually. Less: Issuance cost	September 30, 2021 $ 3,000,000 ( 3,739) 2,996,261 $ 2,500,000 ( 5,139) 2,494,861 $ 5,491,122		December 31, 2020 $ 3,000,000 4,626) 2,995,374 - - - $ 2,995,374		September 30, 2020
	(	(		(	$ 3,000,000 4,924) 2,995,076 - - - $ 2,995,076
	(

In October 2019, the Company entered into a syndicated guarantee facility agreement with 4 banks led by Bank of Taiwan for a NT$3,024,600 thousand credit line; the proceeds are for repaying liabilities.

In July 2021, the Company entered into a syndicated credit facility agreement with 9 banks led by E.SUN Commercial Bank, Ltd. and Bank of Taiwan for a NT$6,660,000 thousand credit line; the proceeds are for repaying liabilities and expanding medium-term working capital.

21. RETIREMENT BENEFIT PLANS

For the three and nine months ended September 30, 2021 and 2020, the pension expenses of defined benefit plans were $9,093 thousand, $11,024 thousand, $26,906 thousand and $32,626 thousand, respectively, and these were calculated based on the pension cost rate determined by the actuarial calculation on December 31, 2020 and 2019, respectively.

22. EQUITY

• a. Share capital

Number of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued		September 30, 2021 1,800,000 $ 18,000,000 1,240,280 $ 12,402,795		December 31, 2020 1,800,000 $ 18,000,000 1,240,280 $ 12,402,795		September 30, 2020 1,800,000 $ 18,000,000 1,240,280 $ 12,402,795

• 30 -

b. Capital surplus

. Capital surplus
May be used to offset deficit, distributed as cash or transferred to share capital (Note) Additional paid-in capital Treasury share transactions The difference between the consideration received or paid and the carrying amount of the subsidiaries’ net assets during actual disposal or acquisition May be used to offset deficit only Share of change in equities of associates or joint ventures Others	September 30, 2021 $ 309,017 19,642 12,872 341,531 27,357 58 27,415	December 31, 2020 $ 309,017 19,642 12,872 341,531 27,357 58 27,415	September 30, 2020
				$ 309,017 19,642 12,872 341,531 27,357 - 27,357

$ 368,946 $ 368,946 $ 368,888

Note: The capital surplus could be used to offset a deficit and distribute as cash dividends or transfer to capital when the Company has no deficit (limited to a certain percentage of the Company’s paid-in capital and once a year).

• c. Retained earnings and dividend policy

The Company’s Articles stipulate that annual profit should be utilized in the following order:

• 1) Pay for income tax.

• 2) Offset accumulated deficit.

• 3) Appropriate as legal reserve 10% of the remaining profit, until the accumulated legal reserve equals the paid-in capital.

• 4) Setting aside or reversing a special reserve in accordance with the shareholders’ meeting or as requested by the authorities.

• 5) The remainder along with the unappropriated earnings are considered as distributable earnings. In accordance with dividend policy, the proposal of earnings appropriation is prepared by the board of directors and resolved in the shareholders’ meeting.

The legal reserve may be used to offset deficit. If the Company has no deficit and the legal reserve has exceeded 25% of the Company’s fully paid share capital, the excess may be transferred to capital or distributed in cash.

Special reserve of NT$426,930 thousand was appropriated because of the exemptions from IFRS 1 elected by the Company. But some of the assets aforementioned were disposed in September, 2021, and the reversal of special reserve was $645 thousand. Therefore, as of September 30, 2021, December 31, 2020 and September 30, 2020, the special reserve was $426,285 thousand, $426,930 thousand, and $426,930 thousand, respectively.

The appropriations of earnings for 2020 and 2019 had been approved in the shareholders’ meetings in July 2021 and June 2020, respectively. The appropriations and dividends per share were as follows:

• 31 -

Legal reserve Special reserve(reversed) Cash dividends	Appropriations of Earnings 2020 2019 $ 248,249 $ 246,031 ( 660,170 ) 931,797 1,860,419 1,736,391	Dividends Per Share (NT$)	Dividends Per Share (NT$)
	2020 $ 248,249 ( 660,170 ) 1,860,419	2020 $ 1.5	2019
			$ 1.4

• d. Other equity items

• 1) Exchange differences on translation of the financial statements of foreign operations

Balance, beginning of the period Recognized for the period Exchange differences on translation of the financial statements of foreign operations Share of exchange differences of associates accounted for using the equity method Balance, end of the period		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 ($1,320,826 ) (685,098) (29,129) ($ 2,035,053)	2020 ($1,684,908) (239,337) (17,080) ($ 1,941,325)
		(	(

The variation of exchange differences on translation of the financial statements of foreign operations is mainly because the subsidiaries in mainland China were affected by the exchange rate fluctuations of the RMB to the NTD.

• 2) Unrealized gains and losses on financial assets at FVTOCI

Balance, beginning of the period Recognized for the period Unrealized gains and losses - equity instruments Other comprehensive income recognized in the period Reclassification adjustments Cumulative unrealized gains and losses of equity instruments transferred to retained earnings due to disposal Balance, end of the period		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 538,306 132,663 132,663 (75,629) $ 595,340	2020 $ 242,219 159,533 159,533 - $ 401,752

• 32 -

e. Non-controlling interests

Balance, beginning of the period Share of net loss for the period Other comprehensive income or loss for the period Exchange differences on translation of the financial statements foreign operations Acquisition of non-controlling interests in subsidiaries (Note 27) Dividends distributed by subsidiaries Non-controlling interests arising from establishing a new subsidiary and increasing the capital of the subsidiary with the ownership percentage Non-controlling interest reduced from liquidation of subsidiaries Balance, end of the period		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 403,805 (1,558) (12,893) - (25,179) 6,580 - $ 370,755	2020 $ 504,398 (27,874) (9,591) (40,571) (7,890) 292 (146) $ 418,618

23. REVENUE

Revenue from contracts with customers Revenue from the sale of goods Lease revenue Contract balances Notes and accounts receivable Contract liabilities (recorded as other current liabilities - others) Sale of goods		For the Three Months Ended September 30 2021 2020 $12,940,816 $ 9,822,769 69,378 65,795 $13,010,194 $ 9,888,564 September 30, 2021 December 31, 2020 $ 19,493,915 $ 17,523,187 $ 128,479 $ 131,902		For the Nine Months Ended September 30	For the Nine Months Ended September 30
				2021 $ 37,216,839 206,829 $ 37,423,668 September 30, 2020 $ 14,802,902 $ 143,719	2020 $ 26,299,138 175,073 $ 26,474,211 January 1, 2020 $ 15,361,112 $ 9,720

The changes in the balance of contract liabilities resulted primarily from the difference in timing between the satisfaction of performance obligations and customer payment.

Revenue of the reporting period recognized from the balance of contract liabilities at the beginning of the year is as follows:

From the balance of contract liabilities at the beginning of the period Sale of goods		For the Three Months Ended September 30 2021 2020 $ 303 $ 520		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 303		2021 $ 131,345	2020 $ 8,807

• 33 -

24. PROFIT BEFORE INCOME TAX

a. Interest income

For the Three Months Ended September 30 For the Nine Months Ended September 30 2021 2020 2021 2020 Interest on bank deposits $ 20,574 $ 24,850 $ 60,703 $ 71,326 Others 5,251 5,263 15,375 12,345 $ 25,825 $ 30,113 $ 76,078 $ 83,671 b. Other income For the Three Months Ended September 30 For the Nine Months Ended September 30 2021 2020 2021 2020 Dividend income $ 48,125 $ 34,252 $ 48,125 $ 34,252 Others 58,471 57,895 169,263 135,213 $ 106,596 $ 92,147 $ 217,388 $ 169,465 c. Other gains and losses For the Three Months Ended September 30 For the Nine Months Ended September 30 2021 2020 2021 2020 Gains on disposal of investment(Note 28) $ 2,924 $ 104,966 $ 2,905 $ 104,966 Gains(Losses) on disposal of property, plant and equipment 68,753 (1,761) 63,834 (7,529) Gains on financial assets Financial assets designated as at FVTPL 6,947 22,556 10,623 31,725 Impairment loss on financial assets - (85,581) - (85,581) Impairment loss on Property, plant and equipment - - - (25,717) Impairment loss on Intangible assets - - - (68) Financial handling fee (10,552) (9,698) (28,112) (34,452) Others (11,207) (16,653) (58,956) (43,515) $ 56,865 $ 13,829 ($ 9,706) ($ 60,171)			For the Three Months Ended September 30	For the Three Months Ended September 30	For the Three Months Ended September 30	For the Three Months Ended September 30	For the Nine Months Ended September 30 2021 2020 $ 60,703 $ 71,326 15,375 12,345 $ 76,078 $ 83,671 For the Nine Months Ended September 30	For the Nine Months Ended September 30 2021 2020 $ 60,703 $ 71,326 15,375 12,345 $ 76,078 $ 83,671 For the Nine Months Ended September 30	For the Nine Months Ended September 30 2021 2020 $ 60,703 $ 71,326 15,375 12,345 $ 76,078 $ 83,671 For the Nine Months Ended September 30
		$	2021 2020 20,574 $ 24,850 5,251 5,263 25,825 $ 30,113 For the Three Months Ended September 30
		$
			$	2021 2020 48,125 $ 34,252 58,471 57,895 106,596 $ 92,147 For the Three Months Ended September 30		2020 $ 34,252 57,895		2021 2020 $ 48,125 $ 34,252 169,263 135,213 $ 217,388 $ 169,465 For the Nine Months Ended September 30
			$			$ 92,147
					2021 $ 2,924 68,753 6,947 - - - (10,552) (11,207) $ 56,865			2021 $ 2,905 63,834 10,623 - - - (28,112) (58,956) ($ 9,706)	2020 $ 104,966 (7,529) 31,725 (85,581) (25,717) (68) (34,452) (43,515) ($ 60,171)

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d. Finance costs

Interest on loans Interest on lease liabilities Less: Amounts included in the cost of qualifying assets		For the Three Months Ended September 30	For the Three Months Ended September 30	For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 76,771 724 (1,313) $ 76,182	2020 $ 90,268 665 (1,473) $ 89,460	2021 $ 221,380 2,302 (4,080) $ 219,602	2020 $ 299,344 1,532 (5,398) $ 295,468

Information about capitalized interest was as follows:

Capitalized interest amount Capitalization rates (%)		For the Three Months Ended September 30	For the Three Months Ended September 30	For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 1,313 0.94～1.08	2020 $ 1,473 1.13～1.34	2021 $ 4,080 0.94～1.16	2020 $ 5,398 1.33～4.94

e. Depreciation and amortization

Property, plant and equipment Investment properties Right-of-use assets Intangible assets Other non-current assets - others An analysis of depreciation by function Operating costs Operating expenses Analysis of amortization by function Operating costs Operating expenses		For the Three Months Ended September 30 2021 2020 $ 488,292 $ 456,959 10,827 10,305 25,712 24,636 5,652 16,013 634 506 $ 531,117 $ 508,419 $ 406,478 $ 379,495 118,353 112,405 $ 524,831 $ 491,900 $ 452 $ 444 5,834 16,075 $ 6,286 $ 16,519		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 488,292 10,827 25,712 5,652 634 $ 531,117 $ 406,478 118,353 $ 524,831 $ 452 5,834 $ 6,286		2021 $ 1,457,888 32,621 79,475 18,042 2,097 $ 1,590,123 $ 1,213,992 355,992 $ 1,569,984 $ 1,350 18,789 $ 20,139	2020 $ 1,362,643 26,189 64,774 45,698 1,527 $ 1,500,831 $ 1,131,266 322,340 $ 1,453,606 $ 1,341 45,884 $ 47,225

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f. Employee benefits

Short-term benefits Salaries Labor and health insurance Others Post-employment benefits Defined contribution plans Defined benefit plans (Note 21) Analysis by function Operating costs Operating expenses		For the Three Months Ended September 30 2021 2020 $ 983,549 $ 899,733 81,894 74,129 83,331 78,871 1,148,774 1,052,733 55,431 19,881 9,093 11,024 64,524 30,905 $ 1,213,298 $ 1,083,638 $ 549,619 $ 474,197 663,679 609,441 $ 1,213,298 $ 1,083,638		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 983,549 81,894 83,331 1,148,774 55,431 9,093 64,524 $ 1,213,298 $ 549,619 663,679 $ 1,213,298		2021 $ 2,950,264 247,816 247,811 3,445,891 162,557 26,906 189,463 $ 3,635,354 $ 1,642,028 1,993,326 $ 3,635,354	2020 $ 2,586,535 204,685 212,987 3,004,207 72,008 32,626 104,634 $ 3,108,841 $ 1,347,784 1,761,057 $ 3,108,841

g. Compensation of employees and remuneration of directors

The Company distributed Compensation of employees and remuneration of directors at rates of 4.5% (inclusive)-5.5% and no higher than 1%, respectively, of pre-tax profit prior to the deduction of Compensation of employees and remuneration of directors. The Compensation of employees and the remuneration of directors are as follows:

Compensation of employees Remuneration of directors		For the Three Months Ended September 30 2021 2020 $ 46,000 $ 42,000 $ 3,600 $ 4,050		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 46,000 $ 3,600		2021 $ 146,000 $ 11,290	2020 $ 87,000 $ 12,150

If there is a change in the amounts after the annual consolidated financial statements are authorized for issue, the differences are recorded as a change in the accounting estimate and will be adjusted in the next year.

The Compensation of employees and remuneration of directors (all in cash) approved by the Company’s board of directors in March 2021 and 2020, and accrual amounts recognized in the consolidated financial statements, respectively, were as follows:

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Amounts approved in the board of directors’ meeting Amounts recognized in the financial statements Difference	For the Year Ended December 31	For the Year Ended December 31
	2020 Compensation of employees Remuneration of Directors $ 123,628 $ 16,200 131,000 16,200 ($ 7,372) $ -	2019
		Compensation of employees Remuneration of Directors $ 121,177 $ 15,325 122,000 15,325 ($ 823) $ -

The differences were adjusted to profit and loss for the years ended December 31, 2021 and 2020.

Information on the Compensation of employees and remuneration of directors approved by the Company’s board of directors is available at the Market Observation Post System website of the Taiwan Stock Exchange.

25. INCOME TAX

• a. Income tax expense (benefit) recognized in profit or loss

Current tax Deferred tax		For the Three Months Ended September 30 2021 2020 $ 379,005 $ 244,976 111,631) ( 34,101) $ 267,374 $ 210,875		For the Nine Months Ended September 30	For the Nine Months Ended September 30
	(	2021 $ 379,005 111,631) ( $ 267,374	(	2021 $ 850,993 64,314) ( $ 786,679	2020 $ 456,932 34,987) $ 421,945

• b. Income tax expense (benefit) recognized directly in equity

Current tax Disposal of investments in equity instruments at FVTOCI	For the Three Months Ended September 30 2021 2020 $ - $ -	For the Three Months Ended September 30 2021 2020 $ - $ -		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ -		2021 $ 3,206 (	2020 $ 3,205 )

• c. Income tax expense (benefit) recognized in other comprehensive income

Deferred tax Unrealized gains and losses on financial assets at fair value through other comprehensive income		For the Three Months Ended September 30 2021 2020 $ 12,135 ) ( $ 2,137 )		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 12,135 )	(	2021 $ 28,992 )	2020 $ 30,416

• d. Income tax assessment

The Company’s income tax returns as of 2019 have been assessed by the tax authorities.

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26. EARNINGS PER SHARE

Basic earnings per share Diluted earnings per share	For the Three Months Ended September 30 2021 2020 $ 0.79 $ 0.72 $ 0.79 $ 0.72	For the Three Months Ended September 30 2021 2020 $ 0.79 $ 0.72 $ 0.79 $ 0.72		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 0.79 $ 0.79		2021 $ 2.32 $ 2.31	2020 $ 1.42 $ 1.41

The net profit and weighted average number of ordinary shares outstanding used in the computation of earnings per share were as follows:

ngs per share were as follows:
Net profit for the period attributable to owners of the Company		For the Three Months Ended September 30 2021 2020 $ 981,184 $ 896,235		For the Nine Months Ended September 30
		2021 $ 981,184		2021 $ 2,879,931	2020 $ 1,758,116

Number of ordinary shares

Weighted average number of ordinary shares used in the computation of basic earnings per share Effect of potentially dilutive ordinary shares Compensation of employees Weighted average number of ordinary shares used in the computation of diluted earnings per share		For the Three Months Ended September 30 2021 2020 1,240,280 1,240,280 1,222 2,656 1,241,502 1,242,936		Unit: Thousand Shares For the Nine Months Ended September 30 2021 2020 1,240,280 1,240,280 4,956 4,382 1,245,236 1,244,662
		2021 1,240,280 1,222 1,241,502		2021 1,240,280 4,956 1,245,236

Since the Company is allowed to settle the compensation paid to employees by cash or shares, the Company assumed that the entire amount of the compensation will be settled in shares and the resulting potential shares are included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, as the shares have a dilutive effect. Such dilutive effect of the potential shares is included in the computation of diluted earnings per share until the shareholders resolve the number of shares to be distributed to employees at their meeting in the following year.

27. EQUITY TRANSACTIONS WITH NON-CONTROLLING INTERESTS

On December 31, 2020, the subsidiary Nikko-Materials Co., Ltd. acquired the equity of its subsidiary Nikko Mechanics Co., Ltd., and increased its percentage of ownership from 80% to 100%. The difference between the payment and the carry amount of the equity acquired was $12,842 thousand and the capital surplus was increased.

The above transactions were accounted for as equity transactions, since the Company and its subsidiaries did not cease to have control over the subsidiary.

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Consideration paid The proportionate share of the carrying amount of the subsidiary’s net assets transferred from non-controlling interests Differences recognized from equity transactions	Amount
	( $ 27,729 ) 40,571 $ 12,842

28. DISPOSAL OF SUBSIDIARIES

The Company’s board of directors had approved the disposal of 100% ownership of the subsidiary Eternal Photoelectronic Material Industry (Kunshan) Co., Ltd. held by its subsidiaries Eternal (China) Investment Co., Ltd. and Eternal Electronic Material (Guangzhou) Co., Ltd. in May 2020. The disposal was completed and the control of the subsidiary was lost in August 2020.

• a. Consideration received

Total consideration received - cash		Amount
		$ 343,140

b. Analysis of assets and liabilities on the date control was lost

Current assets Cash and cash equivalents Other current assets Non-current assets Property, plant and equipment Right-of-use asset Current liabilities Payables Net assets disposed of Gain on disposal of subsidiaries Consideration received Net assets disposed of Transaction cost Effects of foreign currency exchange difference Net cash inflow on disposals of subsidiaries Consideration received in cash and cash equivalents Less: Cash and cash equivalents balance disposed of		Amount
		$ 192,924 117 34,735 3,887 (994) $ 230,669 Amount
		$ 343,140 (230,669) (6,388) (1,117) $ 104,966 Amount
		$ 343,140 (192,924) $ 150,216

c. Gain on disposal of subsidiaries

d. Net cash inflow on disposals of subsidiaries

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29. CASH FLOW INFORMATION

• a. Information on investment activities

Acquisition of property, plant and equipment Decrease in payables for equipment Increase in other non-current liabilities Capitalized interest Cash paid		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 1,244,421 107,772 (91) 1,352,102 (4,080) $ 1,348,022	2020 $ 992,342 135,105 (39,088) 1,088,359 (5,398) $ 1,082,961

• b. Changes in major liabilities arising from financing activities

For the nine months ended September 30, 2021

January 1, 2021 Cash Flows Short-term borrowings $ 4,403,929 $ 2,885,951 Long-term borrowings 12,401,292 ( 2,421,548 ) Bonds payable 2,995,374 2,500,000 For the nine months ended September 30, 2020 January 1, 2020 Cash Flows Short-term borrowings $ 4,414,613 ($ 240,247) Long-term borrowings 13,476,436 ( 111,979 ) Bonds payable 2,994,192 -	Non-cash Changes Exchange Rate Adjustment Issuance Cost September 30, 2021 ( $ 50,816 ) $ - $ 7,239,064 ( 55,454 ) - 9,924,290 - ( 4,252 ) 5,491,122 Non-cash Changes Exchange Rate Adjustment Issuance Cost September 30, 2020 ( $ 46,794 ) $ - $ 4,127,572 ( 75,488 ) - 13,288,969 - 884 2,995,076

For the nine months ended September 30, 2020

30. CAPITAL MANAGEMENT

The Company and its subsidiaries’ objectives in capital management are to safeguard the Company and its subsidiaries’ ability to continue as a going concern and to provide reasonable returns to shareholders, to maintain an optimal capital structure and to reduce the cost of capital.

The Company’s capital management policy is to maintain a strong capital base that maintains the confidence of investors, creditors and the market, as well as supports future operations. Capital includes the Company’s shares, capital surplus, and retained earnings.

31. FINANCIAL INSTRUMENTS

• a. Fair value of financial instruments that are not measured at fair value

Financial assets and liabilities that are not measured at fair value are of short-term duration and are usually repriced at the current market interest rate. Either their carrying amounts are close to their fair values, or their fair values could not be reliably measured.

• 40 -

• b. Fair value of financial instruments that are measured at fair value on a recurring basis

• 1) Fair value hierarchy

September 30,2021 Financial instruments at FVTPL Structured Deposit Mutual funds Financial instruments at FVTOCI Equity instruments Domestic and foreign listed shares Domestic and foreign unlisted shares December 31,2020 Financial instruments at FVTPL Mutual funds Financial instruments at FVTOCI Equity instruments Domestic and foreign listed shares Domestic and foreign unlisted shares September 30,2020 Financial instruments at FVTPL Structured Deposit Mutual funds Financial instruments at FVTOCI Equity instruments Domestic and foreign listed shares Domestic and foreign unlisted shares		Level 1 $ - $ - $ 767,436 $ - $ - $ 642,849 $ - $ - $ - $ 543,277 $ -		Level 2 $ 77,578 $ - $ - $ - $ - $ - $ - $1,541,253 $ - $ - $ -		Level 3 $ - $ 13,314 $ - $ 265,224 $ 21,301 $ 185,302 $ 188,155 $ - $ 26,509 $ 174,876 $ 209,929		Total
								$ 77,578 $ 13,314 $ 767,436 $ 265,224 $ 21,301 $ 828,151 $ 188,155 $1,541,253 $ 26,509 $ 718,153 $ 209,929

There was no transfer between Level 1 and Level 2 for the nine months ended September 30, 2021 and 2020. Since TBG stocks in 2020 had no published price quotations as the fair value input for more than a certain period of time, it was transferred from Level 1 to Level 3.

• 41 -

• 2) Reconciliation of Level 3 fair value measurements of financial instruments

For the Nine Months Ended September 30, 2021

Fund Financial Assets at FVTPL Financial assets Balance, beginning of the period $ 21,301 Recognized in profit or loss (recorded as other gains and losses) (1,884) Recognized in other comprehensive income - Disposal (5,788) Effects of foreign currency exchange differences (315) Balance, end of the period $ 13,314 Unrealized other gains and losses ($ 1,786) For the Nine Months Ended September 30, 2020	Stocks Financial Assets at FVTOCI $ 373,457 - (105,613) - (2,620) $ 265,224	Total $ 394,758 (1,884) (105,613) (5,788) (2,935) $ 278,538 ($ 1,786)

Financial assets Balance , beginning of the period Recognized in profit or loss (recorded as other gains and losses) Recognized in other comprehensive income Transferred to Level 3 Disposal Effects of foreign currency exchange differences Balance end of the period Unrealized other gains and losses	Fund Financial Assets at FVTPL $ 12,483 15,464 - - (893) (545) $ 26,509 $ 14,595	Stocks Financial Assets at FVTOCI $ 225,563 - (37,846) 202,264 (1,517) (3,659) $ 384,805	Total $ 238,046 15,464 (37,846) 202,264 (2,410) (4,204) $ 411,314 $ 14,595

• 3) Valuation techniques and inputs applied for Level 2 fair value measurement

The fair value of structured time deposit is measured by the future cash flows that are estimated and discounted by the expected yield based on the observable index at the end of period.

• 4) Valuation techniques and inputs applied for level 3 fair value measurement

The fair values of TBG stocks, domestic unlisted shares, foreign unlisted shares and mutual funds were determined by the market approach and arrived at by reference to the type of industry, similar companies and the company’s operations.

• 42 -

c. Categories of financial instruments

Financial assets Fair value through profit or loss Mandatorily classified as at fair value through profit or loss Financial assets at amortized cost (Note 1) Financial assets at fair value through other comprehensive income - equity instruments Financial liabilities Financial liabilities at amortized cost (Note 2)	September 30, December 31, September 30, 2021 2020 2020
	$ 90,892 $ 21,301 $ 1,567,762 25,991,070 24,637,813 21,046,394 1,032,660 1,016,306 928,082 32,020,846 28,090,292 26,913,573

• Note 1: The balances included financial assets at amortized cost, including cash and cash equivalents, notes and accounts receivable (including related parties), other financial assets - current and non-current (recorded as other non-current assets - others), other receivables, refundable deposits (recorded as other non-current assets - others), and long-term receivables (recorded as other non-current assets - others).

• Note 2: The balances included financial liabilities at amortized cost, which comprise short-term borrowings, notes and accounts payable, other payables - others, long-term borrowings (including current portion), bonds payable, guarantee deposits received (recorded as other non-current liabilities), and long-term payables (recorded as other non-current liabilities).

d. Financial risk management objectives and policies

The financial risk management objectives of the Company and its subsidiaries are mainly to manage the market risk, credit risk and liquidity risk related to operating activities and to verify, measure and manage the financial risks according to the policies. The Company and its subsidiaries have set up policies, procedures and internal controls to manage the risks in their financial activities. The significant financial activities of the Company and its subsidiaries are in accordance with relevant regulations and internal controls approved by the board of directors. During the execution of financial management activities, the Company and its subsidiaries should be in compliance with the relevant rules of financial risk management.

1) Market risk

a) Foreign currency risk

The Company and its subsidiaries’ operating activities and net investments in foreign operations are denominated mainly in foreign currencies. Consequently, the Company and its subsidiaries are exposed to foreign currency risk. To protect against reductions in the value of foreign currency assets and against the volatility of future cash flows caused by changes in foreign exchange rates, the Company and its subsidiaries utilize derivative financial instruments, such as foreign exchange forward contracts, or maintain net foreign currency assets and liabilities. Foreign currency risk could be reduced but might not be fully eliminated by these methods.

For the carrying amounts of the Company and its subsidiaries’ significant non-functional currency denominated monetary assets and liabilities (including those eliminated on consolidation) at the balance sheet date, refer to Note 36.

• 43 -

Sensitivity analysis

The following table details the sensitivity to a 1% change in the functional currencies against the relevant foreign currencies.

ForeignCurrencies :FunctionalCurrencies Financial assets Monetary items USD:NTD USD:RMB USD:MYR RMB:NTD JPY:NTD THB:NTD EUR:USD Financial liabilities Monetary items USD:NTD USD:RMB USD:MYR JPY:NTD EUR:USD	Impact on Profit or Loss
	For the Nine Months Ended September 30
	2021 2020 $29,116 $21,407 8,673 3,580 4,232 2,519 3,545 2,791 2,381 1,506 1,688 1,393 - 1,532 23,486 18,678 7,877 9,073 4,061 2,755 1,448 1,644 - 1,366

b) Interest rate risk

The borrowings of the Company and its subsidiaries with fixed interest rates were not exposed to cash flow risk. The borrowings with floating interest rates were exposed to cash flow risk as effective interest rates change.

The carrying amounts of the Company and its subsidiaries’ financial assets and financial liabilities with exposure to interest rate risks at the balance sheet dates were as follows:

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities	September 30, December 31, September 30, 2021 2020 2020
	$ 1,990,781 $ 3,493,360 $ 2,590,811 9,755,123 8,039,274 7,572,002 3,596,414 2,741,246 4,349,284 13,188,354 12,105,221 13,116,541

If interest rates had been 1% higher and all other variables were held constant, the Company and its subsidiaries’ financial liabilities would have increased cash outflows by NT$131,884 thousand and NT$131,165 thousand for the nine months ended September 30, 2021 and 2020, respectively.

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c) Other price risk

The Company and its subsidiaries were exposed to equity price risk through their investments in equity securities. If equity prices had been 1% higher/lower, other comprehensive income for the nine months ended September 30, 2021 and 2020 would have increased/decreased by NT$7,674 thousand and NT$7,182 thousand, as a result of the changes in fair value of financial assets at FVTOCI.

2) Credit risk

Credit risk refer to the risk of financial loss to the Company and its subsidiaries arising from default by the clients or counterparties of financial instruments on the contract obligations. According to the Company and its subsidiaries’ policy, each local entity in the Company and its subsidiaries is responsible for managing and analyzing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. The Company and its subsidiaries assess the credit quality of the customers by taking into account their financial position, past experience and other factors to conduct internal risk management and in order to enhance credit guarantee, holding some collaterals of accounts receivable from part of distributors. While the Company and its subsidiaries have procedures to monitor and limit exposure to credit risk on accounts receivable, there can be no assurance that such procedures will effectively limit credit risk and avoid losses. This risk is heightened during periods when economic conditions worsen.

3) Liquidity risk

The Company and its subsidiaries manage its liquidity risk by maintaining adequate cash and cash equivalents, bank borrowings, and so on. The table below summarizes the maturity profile of the Company and its subsidiaries’ financial liabilities based on contractual undiscounted payments, including principal and interest.

September 30, 2021

Non-derivative financial liabilities Short-term borrowings Notes payable Accounts payable Other payables Lease liabilities Long-term borrowings (including current portion) Bonds payable Long-term payable		Less Than 1 Year $ 7,272,448 800,165 6,382,060 2,096,175 84,588 4,077,051 39,100 2,995 $ 20,754,582	1-2 Years $ - - - - 74,091 4,494,028 39,100 3,960 $ 4,611,179	2-3 Years $ - - - - 58,157 399,171 39,100 - $ 496,428	3-5 Years $ - - - - 60,132 1,137,593 5,530,008 - $ 6,727,733	Over 5 Years $ - - - - 24,737 - - - $ 24,737	Total
							$ 7,272,448 800,165 6,382,060 2,096,175 301,705 10,107,843 5,647,308 6,955 $ 32,614,659

December 31, 2020

Non-derivative financial liabilities Short-term borrowings Notes payable Accounts payable Other payables Lease liabilities Long-term borrowings (including current portion) Bonds payable Long-term payable		Less Than 1 Year $ 4,422,932 534,320 5,598,389 2,053,754 92,355 4,134,573 24,600 - $ 16,860,923	1-2 Years $ - - - - 78,924 4,321,629 24,600 10,031 $ 4,435,184	2-3 Years $ - - - - 63,845 3,042,984 24,600 - $ 3,131,429		3-5 Years $ - - - - 87,718 1,183,305 3,020,826 - $ 4,291,849	Over 5 Years $ - - - - 36,690 1,063 - - $ 37,753	Total
								$ 4,422,932 534,320 5,598,389 2,053,754 359,532 12,683,554 3,094,626 10,031 $ 28,757,138

• 45 -

September 30, 2020

Non-derivative financial liabilities Short-term borrowings Notes payable Accounts payable Other payables Lease liabilities Long-term borrowings (including current portion) Bonds payable	Less Than 1 Year $ 4,144,428 527,988 4,058,517 1,826,187 75,446 5,933,251 24,600 $ 16,590,417	1-2 Years $ - - - - 59,218 2,763,767 24,600 $ 2,847,585	2-3 Years $ - - - - 48,632 4,761,752 24,600 $ 4,834,984	3-5 Years $ - - - - 65,544 97,393 3,027,094 $ 3,190,031	Over 5 Years $ - - - - 40,922 4,142 - $ 45,064	Total
						$ 4,144,428 527,988 4,058,517 1,826,187 289,762 13,560,305 3,100,894 $ 27,508,081

e. Transfers of financial assets

Subsidiary discounted notes and transferred most of the banker’s acceptance bills of receivables from China to vendors for repayment. If above financial assets are not paid at maturity, the bank and vendors have the right to request the subsidiary to pay the unsettled balance. As the subsidiary has not transferred the significant risks and rewards relating to these financial assets, it continues to recognize the full carrying amount of the financial assets and has recognized the cash received on the transfer as secured payables and borrowings.

As of September 30, 2021, December 31, 2020 and September 30, 2020, the carrying amount of the accounts receivable that have been transferred but have not been derecognized amounted to $3,107,499 thousand, $2,329,453 thousand and $1,636,617 thousand, respectively, and the carrying amount of the related borrowings and accounts payables were $3,105,920 thousand, $2,328,143 thousand and $1,635,837 thousand, respectively.

32. TRANSACTIONS WITH RELATED PARTIES

Details of transactions between the Company and its subsidiaries and other related parties are disclosed below:

• a. Related party names and relationships

==> picture [463 x 13] intentionally omitted <==

----- Start of picture text -----

Related Party Name Relationship
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Related Party Name	Relationship
Allnex-Eternal Resins Corporation Limited	Associate
Allnex-Eternal Resins (Guangdong) Co., Ltd.	Associate
Eternal Electronic Materials (Kunshan) Co., Ltd.	Associate
Daxin Materials Corporation	Associate
Showa Denko New Material (Zhuhai) Co., Ltd.	Associate
ESCO Specialty Coatings (Shanghai) Co., Ltd.	Associate
DSM Resins (Far East) Ltd.	Associate
Hangzhou Yongxinyang Photoelectric Materials Co., Ltd.	Joint venture (removed from related
	parties after October 2020)
Mitsubishi Polyester Film (Suzhou) Co., Ltd.	Other related party

• b. Operating revenue

Account Item	Related Party Category		For the Three Months Ended September 30	For the Three Months Ended September 30		For the Nine Months Ended September 30	For the Nine Months Ended September 30
Revenue from sales of goods	Associates Joint ventures		2021 $ 187,138 - $ 187,138	2020 $ 136,948 - $ 136,948		2021 $ 518,694 - $ 518,694	2020 $ 340,543 3,932 $ 344,475

• 46 -

Sales to related parties were made at prices similar to that of general transactions. The collection terms are 60-150 days from the end of the month.

c. Purchase of goods

Related Party Category Associates Other related parties	For the Three Months Ended September 30 2021 2020 $ - $ 415 - 985 $ - $ 1,400	For the Three Months Ended September 30 2021 2020 $ - $ 415 - 985 $ - $ 1,400		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ - - $ -		2021 $ 816 2,028 $ 2,844	2020 $ 553 985 $ 1,538

Purchases from related parties were made at prices similar to that of general transactions. The payment terms are 30-120 days from the date after the goods are received.

d. Other income

Related Party Category/Name Associates Allnex-Eternal Resins (Guangdong) Co., Ltd. Others		For the Three Months Ended September 30 2021 2020 $ 10,831 $ 8,019 1,157 1,190 $ 11,988 $ 9,209		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 10,831 1,157 $ 11,988		2021 $ 25,507 4,701 $ 30,208	2020 $ 20,993 4,391 $ 25,384

Inclusive of rental income, service fees and so on.

• e. Receivables from related parties

Account Item Notes and accounts receivable	Related Party Category	September 30, 2021 $ 301,264 - $ 301,264		December 31, 2020 $ 263,376 - $ 263,376	September 30, 2020	September 30, 2020
	Associates Joint ventures					$ 201,575 9,112 $ 210,687

The receivables arise mainly from sales transactions; the receivables were not guaranteed, pledged and are without interest. As of September 30, 2021, December 31, 2020 and September 30, 2020, the balance of allowance for loss is NT$440 thousand, NT$1,037 thousand and NT$14,099 thousand, respectively.

f. Payable to related parties

Account Item Accounts payable	Related Party Category Associates	September 30, 2021 $ -		December 31, 2020 $ 1,958	September 30, 2020 $ 435

The payables arise manly from purchase transactions; the payables were not pledged and are without interest.

• g. Loans to related parties

• 47 -

==> picture [454 x 189] intentionally omitted <==

----- Start of picture text -----

Related Party September 30, December 31, September 30,
Account Item Category/Name 2021 2020 2020
Other receivables Associates
ESCO Specialty $ 156,740 $ 159,761 $ 155,819
Coatings
(Shanghai) Co.,
Ltd.
Eternal Electronic 103,062 105,048 102,456
Materials
(Kunshan) Co.,
Ltd.
$ 259,802 $ 264,809 $ 258,275
----- End of picture text -----

The Company and its subsidiaries provided loans to related parties at rates comparable to market interest rates.

• h. Compensation of key management personnel

Short-term employee benefits Post-employment benefits		For the Three Months Ended September 30 2021 2020 $ 28,221 $ 33,178 120 89 $ 28,341 $ 33,267		For the Nine Months Ended September 30	For the Nine Months Ended September 30
		2021 $ 28,221 120 $ 28,341		2021 $ 85,212 359 $ 85,571	2020 $ 79,906 267 $ 80,173

33. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The Company and its subsidiaries’ assets mortgaged or pledged as collateral for bank borrowings discounted notes loans, supplier payment, customs guarantee and performance guarantee were as follows:

Notes receivable Property, plant and equipment Other financial assets - time deposit certificates and deposit of escrow account (recorded as other non-current assets - others)	September 30, 2021 $ 3,107,499 265,760 18,079 $ 3,391,338	December 31, 2020 $ 2,329,453 295,789 15,000 $ 2,640,242		September 30, 2020
				$ 1,636,617 290,966 19,591 $ 1,947,174

34. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

• a. The Company and its subsidiaries have issued but unused letters of credit with an aggregate amount of NT$114,217 thousand as of September 30, 2021.

• b. The Company and its subsidiaries have contracts that were not yet incurred to purchase property, plant and equipment and intangible assets of NT$1,274,870 thousand at September 30, 2021.

35. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD

• 48 -

None.

36. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The following information was aggregated by the foreign currencies other than functional currencies of the Company and its subsidiaries before elimination and the exchange rates between the foreign currencies and the respective functional currencies were disclosed. The significant assets and liabilities denominated in foreign currencies were as follows:

September 30,2021 Financial assets Monetary items USD USD USD RMB JPY THB Non-monetary items Financial assets at fair value through other comprehensive income AUD Investments accounted for using the equity method USD RMB JPY MYR THB Financial liabilities Monetary items USD USD USD JPY	Foreign Currency (In Thousands) $ 104,545 31,141 15,197 82,562 956,120 203,778 2,010 966,082 6,066,283 8,271,574 239,026 152,278 84,330 28,283 14,581 581,396	Exchange Rate 27.8500 (USD:NTD) 6.4854 (USD:RMB) 4.1870 (USD:MYR) 4.2943 (RMB:NTD) 0.2490 (JPY:NTD) 0.8284 (THB:NTD) 20.0700 (AUD:NTD) 27.8500 (USD:NTD) 0.1542 (RMB:USD) 0.2490 (JPY:NTD) 0.2388 (MYR:USD) 0.8284 (THB:NTD) 27.8500 (USD:NTD) 6.4854 (USD:RMB) 4.1870 (USD:MYR) 0.2490 (JPY:NTD)	Carrying Amount
			$ 2,911,578 867,277 423,236 354,543 238,074 168,810 40,341 26,905,370 26,050,195 2,059,622 1,589,890 126,147 2,348,591 787,682 406,081 144,768

(Continued)

• 49 -

December 31,2020 Financial liabilities Monetary items USD USD USD RMB JPY THB Non-monetary items Financial assets at fair value through other comprehensive income AUD Investments accounted for using the equity method USD RMB JPY MYR THB Financial liabilities Monetary items USD USD USD JPY	Foreign Currency (In Thousands) $ 80,407 18,223 12,252 95,030 860,699 148,594 8,442 931,351 5,883,766 6,626,721 241,959 147,262 67,306 30,755 16,292 671,965	Exchange Rate 28.4800 (USD:NTD) 6.5067 (USD:RMB) 4.1947 (USD:MYR) 4.3770 (RMB:NTD) 0.2763 (JPY:NTD) 0.9556 (THB:NTD) 21.9500 (AUD:NTD) 28.4800 (USD:NTD) 0.1537 (RMB:USD) 0.2763 (JPY:NTD) 0.2384 (MYR:USD) 0.9556 (THB:NTD) 28.4800 (USD:NTD) 6.5067 (USD:RMB) 4.1947 (USD:MYR) 0.2763 (JPY:NTD)	Carrying Amount
			$ 2,289,991 518,991 348,937 415,946 237,811 141,996 185,302 26,524,885 25,753,246 1,830,963 1,642,778 140,723 1,916,875 875,902 463,996 185,664

September 30,2020 Financial assets Monetary items USD USD USD RMB JPY THB EUR	Foreign Currency (In Thousands) 73,565 12,304 8,657 65,382 546,407 150,730 4,486	Exchange Rate 29.1000 (USD:NTD) 6.8166 (USD:RMB) 4.3410 (USD:MYR) 4.2690 (RMB:NTD) 0.2756 (JPY:NTD) 0.9242 (THB:NTD) 1.1735 (EUR:USD)	Carrying Amount
			2,140,742 358,046 251,919 279,116 150,590 139,305 153,197 (Continued)

• 50 -

Non-monetary items Financial assets at fair value through other comprehensive income AUD Investments accounted for using the equity method USD RMB JPY MYR EUR THB Financial liabilities Monetary items USD USD USD JPY EUR	Foreign Currency (In Thousands) $ 8,442 888,431 5,855,894 5,908,708 81,964 3,757 140,155 64,184 31,179 9,466 596,639 4,000	Exchange Rate 20.7150 (AUD:NTD) 29.1000 (USD:NTD) 0.1467 (RMB:USD) 0.2756 (JPY:NTD) 0.2304 (MYR:USD) 34.1500 (EUR:NTD) 0.9242 (THB:NTD) 29.1000 (USD:NTD) 6.8166 (USD:RMB) 4.3410 (USD:MYR) 0.2756 (JPY:NTD) 1.1735 (EUR:USD)	Carrying Amount
			$ 174,876 25,853,333 24,998,810 1,628,439 549,443 128,296 129,531 1,867,754 907,309 275,461 164,434 136,600

(Concluded)

The total realized and unrealized foreign exchange gains and losses were a loss of NT$13,970 thousand, a loss of NT$9,872 thousand, a loss of NT$74,385 thousand and a loss of NT$22,139 thousand for the three months and nine months ended September 30, 2021 and 2020, respectively. It is impractical to disclose net foreign exchange gains and losses by each significant foreign currency due to the variety of the foreign currency transactions and functional currencies of each entity.

37. ADDITIONAL DISCLOSURES

• a. Information about significant transactions and investees:

• 1) Financing provided to others (Table 1)

• 2) Endorsements/guarantees provided (Table 2)

• 3) Marketable securities held (Table 3)

• 4) Marketable securities acquired or disposed at costs or prices at least NT$300 million or 20% of the paid-in capital (Table 4)

• 5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the paid-in capital: None

• 6) Disposal of individual real estate at prices of at least NT$300 million or 20% of the paid-in capital: None

• 7) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the paid-in capital (Table 5)

• 8) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital (Table 6)

• 51 -

• 9) Trading in derivative instruments: (Note 7)

• 10) Others: The business relationship between the parent company and the subsidiaries and between each subsidiary, and the circumstances and amounts of any significant transactions (Table 7)

• 11) Information on investees (Table 8)

• b. Information on investments in mainland China

• 1) Information on any investee company in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, net income of investees, investment gain or loss, carrying amount of the investment at the end of the period, repatriations of investment income, and limit on the amount of investment in the mainland China area. (Table 9)

• 2) Any of the following significant transactions with investee companies in mainland China, either directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or losses:

  • a) The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period (Table 5)

  • b) The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period (Table 5)

  • c) The amount of property transactions and the amount of the resultant gains or losses: None

  • d) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes (Table 2)

  • e) The highest balance, the end of period balance, the interest rate range, and total current period interest with respect to financing of funds (Table 1)

  • f) Other transactions that have a material effect on the profit or loss for the period or on the financial position, such as the rendering or receiving of services: None

• c. Information of major shareholders : list of the shareholders with ownership of 5% or greater, showing the names, the number of shares and percentage of ownership held by each shareholder. (Table 10)

38. SEGMENT INFORMATION

Information reported to the chief operating decision maker for the purposes of resource allocation and assessment of segment performance focuses on the types of industrial materials. Reported segments of the Company and its subsidiaries were as follows:

• Resins Materials

Mainly operating variety of industrial resins materials.

• Electronic Materials

Mainly operating electronic and optoelectronic industry raw material.

• 52 -

 High Performance Materials

Mainly operating UV - light curing raw material.

 Others

The other operating segments which did not meet the quantitative threshold for separate reporting.

Segment revenues and operating results

The Company and its subsidiaries’ segment profit (loss) is used as the basis for assessing the performance of the operating segments. The following is an analysis of the Company and its subsidiaries’ revenues and results of operations by reportable segment.

For the nine months ended September 30,2021 Revenue from the sale of goods Revenues from external customers Revenue from the rendering of service Inter-segment revenues Total revenue Segment operating profit (loss) For the nine months ended September 30,2020 Revenue from the sale of goods Revenues from external customers Revenue from the rendering of service Inter-segment revenues Total revenue Segment operating profit (loss)		Resins Materials $ 18,205,873 - 2,078,186 $ 20,284,059 $ 388,563 $ 12,683,558 - 1,382,688 $ 14,066,246 $ 750,698		Electronic Materials $ 11,081,209 - 4,145,047 $ 15,226,256 $ 1,790,830 $ 8,936,301 - 3,512,832 $ 12,449,133 $ 1,144,086		High Performance Materials $ 7,859,946 - 1,390,610 $ 9,250,556 $ 1,476,402 $ 4,650,049 - 859,046 $ 5,509,095 $ 470,463		Others $ 69,811 206,829 2,437 $ 279,077 ( $ 315,650) $ 29,230 175,073 2,621 $ 206,924 ( $ 300,976)		Adjustment and Elimination $ - - ( 7,616,280) ( $ 7,616,280) $ - $ - - ( 5,757,187) ( $ 5,757,187) $ -		Total
												$ 37,216,839 206,829 - $ 37,423,668 $ 3,340,145 $ 26,299,138 175,073 - $ 26,474,211 $ 2,064,271

• 53 -

TABLE 1

Eternal Materials Co., Ltd. and Subsidiaries

FINANCING PROVIDED TO OTHERS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

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----- Start of picture text -----

(Note 1)No. Lender Borrower Financial Statement Account Related Party Maximum Balance for the Period (Note 2) Ending Balance (Note 3) Actual Amount Drawn Rate (%)Interest Nature of Financing (Note 4) Transaction Amount Reason for Financing Allowance for Bad Debt Item Collateral Value Financing Limits for Each Borrowing Company Total Financing LimitFinancing Company’s Note
1 Eternal Electronic Eternal Electronic Other receivables from Y $ 438,400 $ - $ - - 2 $ - Operating needs $ - - $ - $ 4,648,245 $ 4,648,245 Note 6
Material (Guangzhou) (Suzhou) Co., Ltd. related parties
Co., Ltd.
1 Eternal Electronic ESCO Specialty Other receivables from Y 317,185 156,740 156,740 4.250 2 - Operating needs - - - 929,649 929,649 Note 8
Material (Guangzhou) Coatings (Shanghai) related parties
Co., Ltd. Co., Ltd.
2 Eternal Chemical Eternal Chemical Other receivables from Y 1,052,160 515,311 204,701 3.852 2 - Operating needs - - - 8,397,300 8,397,300 Note 6
(China) Co., Ltd. (Tianjin) Co., Ltd. related parties
2 Eternal Chemical Eternal Synthetic Other receivables from Y 1,096,000 429,426 284,926 3.852 2 - Operating needs - - - 8,397,300 8,397,300 Note 6
(China) Co., Ltd. Resins (Changshu) related parties
Co., Ltd.
2 Eternal Chemical Eternal Materials Other receivables from Y 131,520 - - - 2 - Operating needs - - - 8,397,300 8,397,300 Note 6
(China) Co., Ltd. (Guangdong) Co., related parties
Ltd.
2 Eternal Chemical Eternal Specialty Other receivables from Y 438,400 214,713 52,728 3.852 2 - Operating needs - - - 8,397,300 8,397,300 Note 6
(China) Co., Ltd. Materials (Suzhou) related parties
Co., Ltd.
2 Eternal Chemical Eternal Chemical Other receivables from Y 1,490,560 730,024 643,745 3.852 2 - Operating needs - - - 8,397,300 8,397,300 Note 6
(China) Co., Ltd. (Chengdu) Co., Ltd. related parties
2 Eternal Chemical Eternal Electronic Other receivables from Y 208,560 103,062 103,062 3.850 2 - Operating needs - - - 1,679,460 1,679,460 Note 8
(China) Co., Ltd. Materials (Kunshan) related parties
Co., Ltd.
2 Eternal Chemical Changhe International Other receivables from Y 175,360 - - - 2 - Operating needs - - - 8,397,300 8,397,300 Note 6
(China) Co., Ltd. Trading (GZFTZ) related parties
Co., Ltd.
2 Eternal Chemical Eternal (China) Other receivables from Y 438,400 429,426 - - 2 - Operating needs - - - 8,397,300 8,397,300 Note 6
(China) Co., Ltd. Investment Co., Ltd. related parties
3 Eternal Materials Eternal Chemical Other receivables from Y 131,520 - - - 2 - Operating needs - - - 7,367,927 7,367,927 Note 5
(Guangdong) Co., (China) Co., Ltd. related parties
Ltd.
3 Eternal Materials Eternal (China) Other receivables from Y 1,578,240 644,139 - - 2 - Operating needs - - - 7,367,927 7,367,927 Note 5
(Guangdong) Co., Investment Co., Ltd. related parties
Ltd.
3 Eternal Materials Eternal Electronic Other receivables from Y 175,360 85,885 1,558 3.850 2 - Operating needs - - - 7,367,927 7,367,927 Note 5
(Guangdong) Co., (Suzhou) Co., Ltd. related parties
Ltd.
3 Eternal Materials Eternal Optical Material Other receivables from Y 876,800 429,426 - - 2 - Operating needs - - - 7,367,927 7,367,927 Note 5
(Guangdong) Co., (Suzhou) Co., Ltd. related parties
Ltd.
3 Eternal Materials Eternal Photoelectric Other receivables from Y 306,880 150,299 - - 2 - Operating needs - - - 7,367,927 7,367,927 Note 5
(Guangdong) Co., Material Industry related parties
Ltd. (Yingkou) Co., Ltd.
4 Eternal Holdings Inc. Eternal Technology Other receivables from Y 340,680 167,100 167,100 1.690 2 - Operating needs - - - 35,029,231 35,029,231 Note 5
Corporation related parties
----- End of picture text -----

(Continued)

• 54 -

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----- Start of picture text -----

(Note 1)No. Lender Borrower Financial Statement Account Related Party Maximum Balance for the Period (Note 2) Ending Balance (Note 3) Actual Amount Drawn Rate (%)Interest Nature of Financing (Note 4) Transaction Amount Reason for Financing Allowance for Bad Debt Item Collateral Value Financing Limits for Each Borrowing Company Total Financing LimitFinancing Company’s Note
4 Eternal Holdings Inc. Eternal Sun A. Other receivables from Y $ 205,452 $ 189,826 $ 189,826 1.710-1.730 2 - Operating needs - - - $ 7,005,846 $ 7,005,846 Note 7
(Suzhou) Co., Ltd. related parties
5 Eternal (China) Eternal Chemical Other receivables from Y 876,800 429,426 - - 2 - Operating needs - - - 28,992,038 28,992,038 Note 5
Investment Co., Ltd. (China) Co., Ltd. related parties
5 Eternal (China) Eternal Optical Material Other receivables from Y 1,139,840 - - - 2 - Operating needs - - - 28,992,038 28,992,038 Note 5
Investment Co., Ltd. (Suzhou) Co., Ltd. related parties
5 Eternal (China) Eternal Photoelectric Long-term receivables Y 263,040 - - - 2 - Operating needs - - - 28,992,038 28,992,038 Note 5
Investment Co., Ltd. Material Industry from related parties
(Yingkou) Co,. Ltd.
5 Eternal (China) Eternal Chemical Other receivables from Y 1,607,650 858,852 858,852 3.850 2 - Operating needs - - - 28,992,038 28,992,038 Note 5
Investment Co., Ltd. (Chengdu) Co., Ltd. related parties
5 Eternal (China) Eternal Chemical Other receivables from Y 1,042,800 515,311 515,311 3.850 2 - Operating needs - - - 28,992,038 28,992,038 Note 5
Investment Co., Ltd. (Tianjin) Co., Ltd. related parties
5 Eternal (China) Eternal Synthetic Other receivables from Y 695,200 343,541 343,541 3.850 2 - Operating needs - - - 28,992,038 28,992,038 Note 5
Investment Co., Ltd. Resins (Changshu) related parties
Co., Ltd.
5 Eternal (China) Eternal Materials Other receivables from Y 131,520 128,828 - - 2 - Operating needs - - - 28,992,038 28,992,038 Note 5
Investment Co., Ltd. (Guangdong) Co., related parties
Ltd.
5 Eternal (China) Eternal Electronic Other receivables from Y 434,500 429,426 429,426 3.850 2 - Operating needs - - - 28,992,038 28,992,038 Note 5
Investment Co., Ltd. (Suzhou) Co., Ltd. related parties
----- End of picture text -----

(Concluded)

Note 1: The representation of the numbers are as follows:

1. No. 0 represents the issuer.

2. Investees are numbered in order from No. 1.

3. Note 2: The maximum balance for the period is approved by the board of directors, and translated into NTD using the exchange rate at the balance sheet date.

4. Note 3: The ending balance for the period is approved by the board of directors, and translated into NTD using the exchange rate at the balance sheet date.

5. Note 4: Nature of financing is as follows:

6. Business relationship.

7. Short-term financing

8. Note 5: According to the financing company’s Operation Procedures for Lending Funds to Others, either the financing limit for each borrowing company or financing company’s total financing limits shall not exceed 200% of the net worth of the company as of December 31, 2020, and it should be translated into NTD using the exchange rate at the balance sheet date.

9. Note 6: According to the financing company’s Operation Procedures for Lending Funds to Others, either the financing limit for each borrowing company or financing company’s total financing limits shall not exceed 200% of the net worth of the company’s latest financial statement, and it should be translated into NTD using the exchange rate at the balance sheet date.

10. Note 7: According to the financing company’s Operation Procedures for Lending Funds to Others, either the financing limit for each borrowing company or financing company’s total financing limits shall not exceed 40% of the net worth of the company as of December 31, 2020, and it should be translated into NTD using the exchange rate at the balance sheet date.

11. Note 8: According to the financing company’s Operation Procedures for Lending Funds to Others, either the financing limit for each borrowing company or financing company’s total financing limits shall not exceed 40% of the net worth of the company’s latest financial statement, and it should be translated into NTD using the exchange rate at the balance sheet date.

12. Note 9: Amount was eliminated from the consolidated financial statements, except for investments accounted for using the equity method.

13. 55 -

TABLE 2

Eternal Materials Co., Ltd. and Subsidiaries

ENDORSEMENTS/GUARANTEES PROVIDED FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

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----- Start of picture text -----

Endorsee/Guarantee Maximum Ratio of
Maximum
Limits on Amount Outstanding Accumulated Endorsements Endorsements
Amount Endorsements Endorsements
Endorsements Endorsements Endorsements Endorsements /Guarantees /Guarantees
No. Actual Amount Endorsements /Guarantees /Guarantees by
Endorser/Guarantor Relationship /Guarantees /Guarantees /Guarantees the /Guarantees to Given by Parent Given on Behalf Note
(Note 1) Name Drawn /Guarantees by Amount Subsidiaries on
(Note 2) Given on Behalf During the End of the Period Net Equity per on Behalf of of Companies in
Collaterals Allowable Behalf of Parent
of Each Party Period (Note 5) Latest Financial Subsidiaries Mainland China
(Note 6 & 7)
(Note 4) Statements (%)
0 Eternal Materials Co., Eternal Holdings Inc. 2 $ 23,269,239 $ 502,216 $ 490,160 $ 356,926 - 2.11 $ 23,269,239 Y N N Notes 3 and 6
Ltd.
0 Eternal Materials Co., Eternal Technology 2 23,269,239 285,350 278,500 278,500 - 1.20 23,269,239 Y N N Notes 3 and 6
Ltd. Corporation
0 Eternal Materials Co., Nikko-Materials Co., Ltd. 2 23,269,239 135,800 87,150 - - 0.37 23,269,239 Y N N Notes 3 and 6
Ltd.
0 Eternal Materials Co., Eternal Sun A. (Suzhou) Co., 2 23,269,239 102,726 - - - - 23,269,239 Y N Y Notes 3 and 6
Ltd. Ltd.
0 Eternal Materials Co., Eternal Materials (Malaysia) 2 23,269,239 2,177,933 2,169,812 1,327,217 - 9.32 23,269,239 Y N N Notes 3 and 6
Ltd. Sdn. Bhd.
0 Eternal Materials Co., Elga Europe S.r.l. 2 23,269,239 412,440 387,756 385,494 - 1.67 23,269,239 Y N N Notes 3 and 6
Ltd.
0 Eternal Materials Co., Eternal Nanyang Investment 2 23,269,239 1,426,750 1,392,500 1,141,850 - 5.98 23,269,239 Y N N Notes 3 and 6
Ltd. Co., Ltd.
1 Eternal (China) Eternal Chemical (Tianjin) 2 14,496,019 131,520 - - - - 14,496,019 N N Y Note 7
Investment Co., Ltd. Co., Ltd.
1 Eternal (China) Eternal Synthetic Resins 2 14,496,019 131,520 - - - - 14,496,019 N N Y Note 7
Investment Co., Ltd. (Changshu) Co., Ltd.
----- End of picture text -----

(Continued)

• 56 -

• Note 1: The representation of the numbers are as follows:

• No. 0 represents the issuer.

• Investees are numbered in order from No. 1.

• Note 2: Relationships between the endorser/guarantor and the party being endorsed/guaranteed are as follows:

• Have a business relationship.

• The company owns directly or indirectly more than 50% of the voting shares of the company.

• Total ownership of more than 50% of the investee, either directly by the Company and/or indirectly by the Company’s subsidiaries.

• Subsidiaries in which the Company owns directly or indirectly more than 90% of the voting shares.

• Companies where the Company is required to provide guarantees or endorsements for the construction project based on the construction contract.

• Companies where the shareholders provide endorsements/guarantees to the endorsed/guaranteed company in proportion to its ownership due to a joint venture.

• According to the Consumer Protection Act, companies that are required to provide guarantees and endorsements for joint and several liabilities if involved in the business of pre-sale of real estate.

• Note 3: In accordance with the parent company’s “Procedures for Provision of Endorsements and Guarantees”, limit on endorsement/guarantee given on behalf of each party is 100% of the parent company’s net worth based on latest financial statements.

• Note 4: Maximum amount endorsed/guaranteed during the period is approved by the board of directors, and translated into NTD using the exchange rate at the balance sheet date.

• Note 5: Outstanding endorsements/guarantees at the end of the period are approved by the board of directors, and translated into NTD using the exchange rate at the balance sheet date.

• Note 6: In accordance with the parent company’s “Procedures for Provision of Endorsements and Guarantees”, maximum endorsement/guarantee amount allowable is 100% of the parent company’s net worth based on latest financial statements.

• Note 7: In accordance with the subsidiary’s “Procedures for Provision of Endorsements and Guarantees”, the limit on endorsement/guarantee given on behalf of each party and the maximum amount endorsed/guaranteed is based on its net worth in the financial statements for the year ended December 31, 2020.

• 57 -

TABLE 3

Eternal Materials Co., Ltd. and Subsidiaries

MARKETABLE SECURITIES HELD (EXCLUDING INVESTMENT IN SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES) SEPTEMBER 30, 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

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Relationship with September 30, 2021
Holding Company Name Type and Name of Marketable Securities the Holding Financial Statement Account Carrying Percentage of Note
Shares/Units Fair Value
Company Amount Ownership (%)
Eternal Materials Co., Ltd. President Securities Corp. (stock) - Financial assets at fair value through other 33,366,767 $ 767,436 2.29 $ 767,436
comprehensive income - non-current
TBG Diagnostics Limited (stock) - Financial assets at fair value through other 40,200,000 40,341 18.48 40,341
comprehensive income - non-current
Universal Venture Capital Investment Corp. (stock) - Financial assets at fair value through other 5,000,000 40,644 4.15 40,644
comprehensive income - non-current
Der Yang Biotechnology Venture Capital Co., Ltd. - Financial assets at fair value through other 353,994 4,316 11.11 4,316
(stock) comprehensive income - non-current
Hwa Nan Venture Capital Co., Ltd. (stock) - Financial assets at fair value through other 57,438 - 10.60 -
comprehensive income - non-current
Mixville Holdings Inc. Grace THW Holding Limited (stock) - Financial assets at fair value through other 1,900,000 179,923 Note 179,923
comprehensive income - non-current
Pacven Walden Ventures V, L.P. (fund) - Financial assets at fair value through profit or loss - - 13,314 Note 13,314
non-current
----- End of picture text -----

Note : The percentage of ownership is less than 1%.

• 58 -

TABLE 4

Eternal Materials Co., Ltd. and Subsidiaries

MARKETABLE SECURITIES ACQUIRED OR DISPOSED OF AT COSTS OR PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

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Type and Name of Beginning Balance Acquisition(Note 1) Disposal Ending Balance(Note 2)
Financial Statement
Company Name Marketable Counterparty Relationship Number of Number of Number of Carrying Gain (Loss) on Number of
Account Amount Amount Amount Amount
Securities Shares Shares Shares Amount Disposal Shares
Eternal Optical Investments accounted
Eternal (China) Material (Suzhou) for using the equity
Investment Co., Ltd. Co., Ltd. method Note 4 Subsidiary - $ (711,257) Note 3 $ 949,080 - $ - $ - $ - Note 3 $ 213,308
Eternal Photoelectric Investments accounted
Eternal (China) Material Industry for using the equity
Investment Co., Ltd. (Yingkou) Co., Ltd. method Note 4 Subsidiary - (208,355) Note 3 345,120 - - - - Note 3 152,262
Eternal Material Investments accounted
Eternal (China) Industry (Tongling) for using the equity
Investment Co., Ltd. Co., Ltd. method Note 4 Subsidiary - - Note 3 429,900 - - - - Note 3 429,733
----- End of picture text -----

Note 1: The acquisition included issuance of ordinary shares for cash, and the amounts were translated into NTD using the exchange rate at the base date.

Note 2: The ending balance included increased investment amount, share of profit or loss of subsidiaries, associates and joint ventures accounted for using the equity method and translation of the financial statement of foreign operations.

Note 3: No share was issued.

Note 4: The Company had capital increase.

• 59 -

TABLE 5

Eternal Materials Co., Ltd. and Subsidiaries

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

==> picture [1096 x 572] intentionally omitted <==

----- Start of picture text -----

Notes/Accounts
Transaction Details Abnormal Transaction
Receivable (Payable)
Company name Related Party Relationship Note
Purchases/Sales
Amount % to Total Payment Terms Unit Price Payment Term Ending Balance % to Total
(Note 2)
Eternal Materials Co., Ltd. Eternal Chemical (China) Co., Subsidiary Sales $ 247,653 2 Note 1 $ - - $ 75,980 2 Note 3
Ltd.
Eternal (China) Investment Subsidiary Sales 286,279 2 Note 1 - - 85,564 2 Note 3
Co., Ltd.
CHOU-KOU Materials Co., Subsidiary Sales 265,748 2 Note 1 - - 104,903 2 Note 3
Ltd.
Eternal Specialty Materials Subsidiary Sales 531,087 4 Note 1 - - 124,646 3 Note 3
(Zhuhai) Co., Ltd.
Eternal Materials Subsidiary Sales 247,809 2 Note 1 - - 50,615 1 Note 3
(Guangdong) Co., Ltd.
Eternal Electronic Material Subsidiary Sales 293,127 2 Note 1 - - 166,249 4 Note 3
(Thailand) Co., Ltd.
Eternal Electronic (Suzhou) Subsidiary Sales 117,664 1 Note 1 - - 50,913 1 Note 3
Co., Ltd
Eternal Electronic Material Subsidiary Sale 152,453 1 Note 1 - - 35,717 1 Note 3
(Guangzhou) Co., Ltd.
Eternal Photo Electronic Subsidiary Sale 107,854 1 Note 1 - - 26,951 1 Note 3
Materials (Guangzhou)
Co., Ltd.
Eternal Chemical (Tianjin) Eternal Chemical (China) Co., Subsidiary Sale 124,669 8 Note 1 - - 83,640 7 Note 3
Co., Ltd. Ltd.
Eternal Electronic Material Eternal Photo Electronic Sister company Sales 329,529 15 Note 1 - - 169,594 10 Note 3
(Guangzhou) Co., Ltd. Materials (Guangzhou)
Co., Ltd.
Eternal Materials Eternal Chemical (China) Co., Sister company Sales 143,294 3 Note 1 - - 49,938 2 Note 3
(Guangdong) Co., Ltd. Ltd.
Eternal Electronic Material Sister company Sales 214,926 5 Note 1 - - 50,672 2 Note 3
(Guangzhou) Co., Ltd
Eternal Photo Electronic Sister company Sales 226,031 5 Note 1 - - 58,698 2 Note 3
Materials (Guangzhou)
Co., Ltd.
Allnex-Eternal Resins Associates Sales 223,275 5 Note 1 - - 106,946 4
(Guangdong) Co., Ltd.
Eternal Specialty Materials Eternal Electronic (Suzhou) Sister company Sales 184,283 8 Note 1 - - 109,613 9 Note 3
(Suzhou) Co., Ltd. Co., Ltd
Eternal Materials Co., Ltd. Ultimate parent Sales 161,014 7 Note 1 - - 73,319 6 Note 3
company
Eternal Photo Electronic Eternal Electronic (Suzhou) Sister company Sales 461,924 21 Note 1 - - 360,710 20 Note 3
Materials (Guangzhou) Co., Ltd.
Co., Ltd. Eternal Electronic Material Sister company Sales 505,892 23 Note 1 - - 312,782 17 Note 3
(Guangzhou) Co., Ltd.
Eternal Specialty Materials Eternal Materials Co., Ltd. Ultimate parent Sales 221,901 5 Note 1 - - 52,056 3 Note 3
(Zhuhai) Co., Ltd. company
----- End of picture text -----

(Continued)

• 60 -

Company name	Related Party	Relationship		Transaction Details	Transaction Details	Transaction Details	Abnormal Transaction	Abnormal Transaction	Notes/Accounts Receivable (Payable)	Notes/Accounts Receivable (Payable)	Note
			Purchases/Sales (Note 2)	Amount	% to Total	Payment Terms	Unit Price	Payment Term	Ending Balance	% to Total
Nikko Mechanics Co., Ltd. Eternal Chemical (China) Co., Ltd.	Nikko-Materials Co., Ltd. Allnex-Eternal Resins (Guangdong)Co.,Ltd.	Parent company Associates	Sales Sales	993,241 171,886	99 4	Note 1 Note 1	- -	- -	308,321 135,559	99 5	Note 3

(Concluded)

Note 1: The terms are similar to that of non-related party transactions.

Note 2: For transactions between related parties, only one side of the transaction was disclosed.

Note 3: Amounts were eliminated from the consolidated financial statements.

• 61 -

TABLE 6

Eternal Materials Co., Ltd. and Subsidiaries

RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL SEPTEMBER 30, 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

==> picture [1037 x 508] intentionally omitted <==

----- Start of picture text -----

Overdue Amounts Received
Allowance for
Company Name Related Party Relationship Ending Balance Turnover Rate in Subsequent
Amount Actions Taken Doubtful Accounts
Period
Eternal Materials Co., Ltd. CHOU-KOU Materials Co., Ltd. Subsidiary $ 104,903 3.33 $ 1,911 Collected subsequently $ 36,890 $ -
Eternal Specialty Materials Subsidiary 124,646 5.38 - - 50,124 -
(Zhuhai) Co., Ltd.
Eternal Electronic Materials Subsidiary 166,249 2.64 37,895 Collected subsequently 40,237 -
(Thailand) Co., Ltd.
Eternal Electronic Material Eternal Photo Electronic Materials Sister company 169,594 2.04 77,563 Collected subsequently 36,319 -
(Guangzhou) Co., Ltd. (Guangzhou) Co., Ltd.
Eternal Photo Electronic Materials Eternal Electronic (Suzhou) Co., Sister company 360,710 1.58 126,271 Collected subsequently 59,659 -
(Guangzhou) Co., Ltd. Ltd.
Eternal Electronic Material Sister company 312,782 2.22 118,040 Collected subsequently 55,560 -
(Guangzhou) Co., Ltd.
Eternal Specialty Materials Eternal Electronic (Suzhou) Co., Sister company 109,613 3.13 - - 15,171 -
(Suzhou) Co., Ltd. Ltd.
Eternal Chemical (China) Co., Allnex-Eternal Resins Associates 135,559 1.84 8,653 Collected subsequently 19,496 29
Ltd. (Guangdong) Co., Ltd.
Eternal Materials (Guangdong) Allnex-Eternal Resins Associates 106,946 2.88 19,579 Collected subsequently 19,868 357
Co., Ltd. (Guangdong) Co., Ltd.
Nikko Mechanics Co., Ltd. Nikko-Materials Co., Ltd. Parent company 308,321 4.24 - - 108,688 -
----- End of picture text -----

Note: Amount was eliminated from the consolidated financial statements, expect the investments accounted for using the equity method.

• 62 -

TABLE 7

Eternal Materials Co., Ltd. and Subsidiaries

INTERCOMPANY BUSINESS RELATIONSHIPS AND SIGNIFICANT INTERCOMPANY TRANSACTIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021 (In Thousands of New Taiwan Dollars)

==> picture [1097 x 521] intentionally omitted <==

----- Start of picture text -----

Transactions Details
No. Relationship % to Total
Company Name Counterparty Financial Statement Item
(Note 1) (Note 2) Amount Terms Revenues or
(Note 5)
Assets
0 Eternal Materials Co., Ltd. Eternal Chemical (China) Co., Ltd. 1 Revenue from sales of goods $ 247,653 Note3 0.66
0 Eternal Materials Co., Ltd. Eternal (China) Investment Co., Ltd. 1 Revenue from sales of goods 286,279 Note3 0.76
0 Eternal Materials Co., Ltd. CHOU-KOU Materials Co., Ltd. 1 Revenue from sales of goods 265,748 Note3 0.71
0 Eternal Materials Co., Ltd. CHOU-KOU Materials Co., Ltd. 1 Notes and accounts receivable from related parties 104,903 Note3 0.17
0 Eternal Materials Co., Ltd. Eternal Specialty Materials (Zhuhai) 1 Revenue from sales of goods 531,087 Note3 1.42
Co., Ltd.
0 Eternal Materials Co., Ltd. Eternal Specialty Materials (Zhuhai) 1 Notes and accounts receivable from related parties 124,646 Note3 0.21
Co., Ltd.
0 Eternal Materials Co., Ltd. Eternal Materials (Guangdong) Co., 1 Revenue from sales of goods 247,809 Note3 0.66
Ltd.
0 Eternal Materials Co., Ltd. Eternal Electronic Material 1 Revenue from sales of goods 293,127 Note3 0.78
(Thailand) Co., Ltd.
0 Eternal Materials Co., Ltd. Eternal Electronic Material 1 Notes and accounts receivable from related parties 166,249 Note3 0.28
(Thailand) Co., Ltd.
0 Eternal Materials Co., Ltd. Eternal Electronic (Suzhou) Co., Ltd. 1 Revenue from sales of goods 117,664 Note3 0.31
0 Eternal Materials Co., Ltd. Eternal Electronic Material 1 Revenue from sales of goods 152,453 Note3 0.41
(Guangzhou) Co., Ltd.
0 Eternal Materials Co., Ltd. Eternal Photo Electronic Materials 1 Revenue from sales of goods 107,854 Note3 0.29
(Guangzhou) Co., Ltd.
1 Eternal Holdings Inc. Eternal Technology Corporation 1 Other receivables from related parties 167,100 Note4 0.28
1 Eternal Holdings Inc. Eternal Sun A. (Suzhou) Co., Ltd 1 Other receivables from related parties 189,826 Note4 0.32
2 Eternal (China) Investment Eternal Chemical (Chengdu) Co., 1 Other receivables from related parties 858,852 Note4 1.43
Co., Ltd. Ltd.
2 Eternal (China) Investment Eternal Chemical (Tianjin) Co., Ltd. 1 Other receivables from related parties 515,311 Note4 0.86
Co., Ltd.
2 Eternal (China) Investment Eternal Synthetic Resins (Changshu) 1 Other receivables from related parties 343,541 Note4 0.57
Co., Ltd. Co., Ltd.
2 Eternal (China) Investment Eternal Electronic (Suzhou) Co., Ltd. 1 Other receivables from related parties 429,426 Note4 0.71
Co., Ltd.
3 Eternal Chemical (China) Co., Eternal Chemical (Tianjin) Co., Ltd. 3 Other receivables from related parties 204,701 Note4 0.34
Ltd.
3 Eternal Chemical (China) Co., Eternal Synthetic Resins (Changshu) 3 Other receivables from related parties 284,926 Note4 0.47
Ltd. Co., Ltd.
3 Eternal Chemical (China) Co., Eternal Chemical (Chengdu) Co., 3 Other receivables from related parties 643,745 Note4 1.07
Ltd. Ltd.
(Continued)
----- End of picture text -----

• 63 -

==> picture [1096 x 507] intentionally omitted <==

----- Start of picture text -----

Transactions Details
No. Relationship % to Total
Company Name Counterparty Financial Statement Item
(Note 1) (Note 2) Amount Terms Revenues or
(Note 5)
Assets
4 Eternal Electronic Material Eternal Photo Electronic Materials 3 Revenue from sales of goods $ 329,529 Note3 0.88
(Guangzhou) Co., Ltd. (Guangzhou) Co., Ltd.
4 Eternal Electronic Material Eternal Photo Electronic Materials 3 Notes and accounts receivable from related parties 169,594 Note3 0.28
(Guangzhou) Co., Ltd. (Guangzhou) Co., Ltd.
5 Eternal Photo Electronic Eternal Electronic (Suzhou) Co., Ltd. 3 Revenue from sales of goods 461,924 Note3 1.23
Materials (Guangzhou) Co.,
Ltd.
5 Eternal Photo Electronic Eternal Electronic (Suzhou) Co., Ltd. 3 Notes and accounts receivable from related parties 360,710 Note3 0.60
Materials (Guangzhou) Co.,
Ltd.
5 Eternal Photo Electronic Eternal Electronic Material 3 Revenue from sales of goods 505,892 Note3 1.35
Materials (Guangzhou) Co., (Guangzhou) Co., Ltd.
Ltd.
5 Eternal Photo Electronic Eternal Electronic Material 3 Notes and accounts receivable from related parties 312,782 Note3 0.52
Materials (Guangzhou) Co., (Guangzhou) Co., Ltd.
Ltd.
6 Eternal Materials (Guangdong) Eternal Chemical (China) Co., Ltd. 3 Revenue from sales of goods 143,294 Note3 0.38
Co., Ltd.
6 Eternal Materials (Guangdong) Eternal Electronic Material 3 Revenue from sales of goods 214,926 Note3 0.57
Co., Ltd. (Guangzhou) Co., Ltd.
6 Eternal Materials (Guangdong) Eternal Photo Electronic Materials 3 Revenue from sales of goods 226,031 Note3 0.60
Co., Ltd. (Guangzhou) Co., Ltd.
7 Eternal Specialty Materials Eternal Electronic (Suzhou) Co., Ltd. 3 Revenue from sales of goods 184,283 Note3 0.49
(Suzhou) Co., Ltd.
7 Eternal Specialty Materials Eternal Electronic (Suzhou) Co., Ltd. 3 Notes and accounts receivable from related parties 109,613 Note3 0.18
(Suzhou) Co., Ltd.
7 Eternal Specialty Materials Eternal Materials Co., Ltd. 2 Revenue from sales of goods 161,014 Note3 0.43
(Suzhou) Co., Ltd.
8 Nikko Mechanics Co., Ltd Nikko-Materials Co., Ltd. 2 Revenue from sales of goods 993,241 Note3 2.65
8 Nikko Mechanics Co., Ltd. Nikko-Materials Co., Ltd. 2 Notes and accounts receivable from related parties 308,321 Note3 0.51
9 Eternal Specialty Materials Eternal Materials Co., Ltd. 2 Revenue from sales of goods 221,901 Note3 0.59
(Zhuhai) Co., Ltd.
10 Eternal Chemical (Tianjin) Eternal Chemical (China) Co., Ltd. 3 Revenue from sales of goods 124,669 Note3 0.33
Co., Ltd.
(Concluded)
----- End of picture text -----

N ote 1: The transaction information of the Company and its subsidiaries is numbered in column “No.”. The representation of the numbers are as follows:

1. No. 0 represents the Company.

2. Subsidiaries are numbered in order from No. 1.

Note 2: The relationships among the transaction parties are as follows:

1. The parent company to subsidiary.

2. The subsidiary to the parent company.

3. The subsidiary to another subsidiary.

Note 3: The terms are similar to non-related party transactions.

Note 4: In accordance with the Operational Procedures for Lending Funds to Others.

Note 5: For transactions between related parties, only one side of the transaction was disclosed.

• 64 -

TABLE 8

Eternal Materials Co., Ltd. and Subsidiaries

INFORMATION ON INVESTEES (EXCLUDING INVESTMENT IN MAINLAND CHINA) FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

==> picture [1093 x 552] intentionally omitted <==

----- Start of picture text -----

Original Investment Amount Balance as of September 30, 2021 Net Income
Investment Gain
Investor Company Investee Company Location Main Businesses and Products September 30, December 31, Number of Percentage of Carrying (Loss) of the Note
(Loss)
2021 2020 Shares Ownership (%) Amount Investee
Eternal Materials Co., Ltd. Eternal Holdings Inc. Samoa International investment $ 6,259,870 $ 6,259,870 204,273,859 100.00 $ 18,776,844 $ 1,546,634 $ 1,599,086
Eternal Materials Co., Ltd. Eternal Global (BVI) Co., Ltd. British Virgin Islands International investment 717,527 717,527 16,821,024 100.00 4,569,355 298,706 295,649
Eternal Materials Co., Ltd. Mixville Holdings Inc. British Virgin Islands International investment 989,582 989,582 29,530,000 100.00 3,559,171 187,122 181,984
Eternal Materials Co., Ltd. Advanced PETFILM Investment Japan International investment 788,630 788,630 270 20.00 467,315 179,600 41,642
Co., Ltd.
Eternal Materials Co., Ltd. Daxin Materials Corporation Taiwan Manufacturing and selling of chemical, resins 191,052 191,052 23,423,812 22.80 661,709 512,761 116,910
materials and electronic materials.
Eternal Materials Co., Ltd. New E Materials Co., Ltd. Taiwan Researching, developing, manufacturing and 82,322 82,322 6,907,585 62.80 38,216 (13,451 ) (8,447 )
selling of photoelectric, semiconductor
process related electronic chemical
materials and equipment spare parts
Eternal Materials Co., Ltd. DSM Resins (Far East) Co., Ltd. Taiwan Manufacturing and selling of powder coating 36,400 36,400 3,660,000 40.00 208,715 142,731 57,092
resin
Eternal Materials Co., Ltd. Eternal Electronic Material Thailand Trading services, cutting and selling of dry 90,919 90,919 937,500 75.00 126,147 34,000 25,493
(Thailand) Co., Ltd. film photoresist
Eternal Materials Co., Ltd. CHOU-KOU Materials Co., Ltd. Japan Selling, trading and providing services of 60,431 60,431 4,000 100.00 88,908 7,520 14,231
resins material, electronic material and other
related products
Eternal Materials Co., Ltd. Nikko-Materials Co., Ltd. Japan Manufacturing and selling of dry film 257,657 257,657 11,520 100.00 1,503,399 538,190 534,196
photoresist and vacuum laminator
Eternal Materials Co., Ltd. Elga Europe S.r.l. Italy Manufacturing, selling, agency and processing 287,169 287,169 - 72.68 (3,926 ) (24,294) (17,657 )
of electronic chemical products
Eternal Holdings Inc. Eternal International (BVI) Co., British Virgin Islands International investment 5,739,033 5,739,033 183,793,592 100.00 15,479,910 1,051,650 - Note
Ltd.
Eternal Holdings Inc. E-Chem Corp. Samoa International investment 165,608 165,608 4,990,000 100.00 2,586,283 470,860 - Note
Eternal Holdings Inc. Eternal Nanyang Investment Co., Samoa International investment 540,493 540,493 18,450,000 90.00 411,411 (33,731) - Note
Ltd.
Eternal Holdings Inc. PT Eternal Materials Indonesia Indonesia Selling, trading of chemical 13,360 - 670 67.00 11,968 (1,767) - Note
Eternal Holdings Inc. Allnex-Eternal Resins Corporation Hong Kong Trading and international investment 174,293 174,293 5,341,000 49.00 406,087 98,556 - Note
Limited
Eternal Holdings Inc. Polymer Instrumentation and United States Plastic products manufacturing 121,913 121,913 4,694,296 30.00 - - - Note
Consulting Services, Ltd.
Eternal International (BVI) Eternal Technology Corporation United States Manufacturing and selling of photoresist 600,693 600,693 2,333 100.00 (105,628 ) (21,299 ) - Note
Co., Ltd.
Mixville Holdings Inc. High Expectation Limited Cayman Islands International investment 871,519 871,519 26,005,000 100.00 3,357,816 189,040 - Note
Eternal (China) Investment Elga Europe S.r.l. Italy Manufacturing, selling, agency and processing 58,610 58,610 - 22.32 (906 ) (24,294 ) - Note
Co., Ltd. of electronic chemical products
Nikko-Materials Co., Ltd. Nikko Mechanics Co., Ltd. Japan Designing, manufacturing, selling of industrial 135,626 135,626 6,560 100.00 395,985 108,649 - Note
machinery and machine tool
Eternal Nanyang Eternal Materials (Malaysia) Sdn. Malaysia Manufacturing, selling, trading and providing 1,748,418 1,748,418 347,324,000 100.00 1,589,890 (18,573 ) - Note
Investment Co., Ltd. Bhd. services of resins material related products
----- End of picture text -----

Note: It had been consolidated into the net income (loss) of investees recognized by the Company using the equity method, and also considered into the calculation of the Company’s investment income or loss.

• 65 -

TABLE 9

Eternal Materials Co., Ltd. and Subsidiaries

INFORMATION ON INVESTMENTS IN MAINLAND CHINA FOR THE PERIOD ENDED SEPTEMBER 30, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

==> picture [1096 x 530] intentionally omitted <==

----- Start of picture text -----

Accumulated Investment Flows Accumulated % of Accumulated
Method of Outward Remittance Outward Remittance Ownership of
Total Amount of Net Income (Loss) of Investment Gain Carrying Amount as Repatriation of
Investee Company Main Businesses and Products Investment for Investments from for Investments from Direct or Note
Paid-in Capital (Note 1) Taiwan as of January Outward Inward Taiwan as of the Investee Indirect (Loss) of September 30, 2021 Investment Income as
1, 2021 September 30, 2021 Investment of September 30, 2021
Eternal Chemical Manufacturing and selling of resins $ 755,651 2 $ 625,549 $ - $ - $ 625,549 $ 259,581 100.00 $ 259,581 $ 4,198,651 $ 1,424,082 Note 2
(China) Co., Ltd. material and processing products
DSM Eternal Resins Manufacturing and selling of powder 183,470 2 91,735 - - 91,735 75,692 50.00 39,008 364,514 544,920 Note 3
(Kunshan) Co., Ltd. coating resin
Changhe International International trading, commercial - 2 7,020 - - 7,020 (2,439) - (2,439) - - Note 3 and
Trading (GZFTZ) trading, entrepot trading, products 7
Co., Ltd. displayed, bonded warehousing and
business consulting services
Eternal Electronic Coating, slitting, cutting, processing, 1,259,046 2 444,685 - - 444,685 248,948 100.00 248,948 2,324,122 983,767 Note 2
Material and selling of photoresist
(Guangzhou) Co.,
Ltd.
Eternal Optical Manufacturing and selling of optical 1,563,967 2 - - - - (34,046) 100.00 (34,046) 213,308 - Note 3
Material (Suzhou) film
Co., Ltd.
Eternal Photo Researching, developing, manufacturing 997,694 2 - - - - 377,643 100.00 377,643 2,413,622 - Note 2
Electronic Materials and selling of electronic high-tech
(Guangzhou) Co., chemical and related products
Ltd.
Eternal Photoelectric Researching, developing and 469,402 2 - - - - 13,247 100.00 13,247 152,262 - Note 3
Material Industry manufacturing of photoresist dry film,
(Yingkou) Co., Ltd. liquid photo imaginable solder masks
and printed circuit board related
materials
Eternal Electronic Manufacturing and selling of epoxy 524,337 2 456,427 - - 456,427 68,865 40.00 30,866 242,997 - Note 3
Materials (Kunshan) molding compound which used in
Co., Ltd. electronic parts and related products
Eternal Synthetic Manufacturing and selling of 726,426 2 279,811 - - 279,811 (9,389) 100.00 (9,389) 197,798 - Note 3
Resins (Changshu) unsaturated polyester resin
Co., Ltd.
Eternal Chemical Manufacturing and selling of adhesives, 1,008,004 2 599,320 - - 599,320 28,179 100.00 28,179 862,922 - Note 3
(Tianjin) Co., Ltd. resins material and processing
products
Eternal Specialty Manufacturing and selling of acrylic 611,011 2 243,540 - - 243,540 504,878 90.00 470,874 2,574,013 788,866 Note 2
Materials (Zhuhai) resin and methacrylic acid
Co., Ltd.
ESCO Specialty Researching, manufacturing and selling 403,180 2 196,680 - - 196,680 (17,357) 40.00 (10,095) (23,833) - Note 3
Coatings (Shanghai) of processing electronic high-tech
Co., Ltd. chemical, high performance coating,
material and products
Eternal Materials Manufacturing and selling of adhesives, 1,297,259 2 868,175 - - 868,175 189,080 100.00 189,080 3,355,728 1,885,420 Note 3
(Guangdong) Co., resins material and processing
Ltd. products
Eternal (China) Managing, investing consulting 7,557,603 2 4,264,844 - - 4,264,844 1,072,015 100.00 1,072,015 15,557,289 - Notes 3 and
Investment Co., Ltd. services, researching, leasing, 4
manufacturing and selling of resins
material and photoelectric chemicals
materials
----- End of picture text -----

(Continued)

• 66 -

==> picture [1096 x 410] intentionally omitted <==

----- Start of picture text -----

Accumulated Accumulated % of
Investment Flows Accumulated
Method of Outward Remittance Outward Remittance Ownership of
Total Amount of Net Income (Loss) of Investment Gain Carrying Amount as Repatriation of
Investee Company Main Businesses and Products Investment for Investments from for Investments from Direct or Note
Paid-in Capital (Note 1) Taiwan as of January Outward Inward Taiwan as of the Investee Indirect (Loss) of September 30, 2021 Investment Income as
of September 30, 2021
1, 2021 September 30, 2021 Investment
Eternal Chemical Researching and developing resins $ 450,351 2 $ - $ - $ - $ - $ (97,988) 100.00 $ (97,988) $ (477,661) $ - Note 3
(Chengdu) Co., Ltd. material and products
Eternal Electronic Researching, developing, and 1,492,280 2 - - - - 164,299 100.00 164,299 1,714,712 - Note 2
(Suzhou) Co., Ltd. manufacturing of dry film photoresist
and dry film solder mask which used
in electronic materials, researching
resin materials and selling, providing
after sales service of self-produced
products
Eternal Sun A. Researching, developing, and 751,443 2 - - - - (84,714) 60.00 (50,828) 42,401 - Note 3
(Suzhou) Co., Ltd. manufacturing of optical protective
film which used in display, and
selling, providing after sales service
of self-produced products
Eternal Specialty Researching and developing chemical 1,199,225 2 - - - - 266,263 100.00 266,263 1,487,411 - Note 3
Materials (Suzhou) products, and selling, providing
Co., Ltd. technical services of self-produced
products
Showa Denko New Manufacturing and selling and 366,881 2 - - - - 3,561 30.00 1,393 87,844 - Note 3
Material (Zhuhai) manufacturing of functional resins,
Co., Ltd. resins composite material and
providing technical services
Eternal Material Manufacturing and selling resins 429,900 2 - - - - 308 100.00 308 429,733 - Note 3
Industry (Tongling) material products and providing
Co., Ltd. technical services.
(Concluded)
Accumulated Outward Remittance Investment Amount Authorized by Upper Limit on the Amount of
for Investments in Mainland China the Investment Commission, Investments Stipulated by the
Investor Company
as of September 30, 2021 MOEA Investment Commission, MOEA
(Note 5) (Note 5) (Note 6)
Eternal Materials Co., Ltd. $ 8,083,938 $ 26,111,170 $ -
----- End of picture text -----

(Concluded)

• Note 1: Investment methods are classified into the following three categories:

• Direct investment in a company in mainland China.

• Investing through companies in a third region (Eternal Holdings Inc., Eternal Global (BVI) Co., Ltd and Mixville Holdings Inc.).

• Others.

• Note 2: The investment gains and losses were recognized from the financial statements reviewed by the parent company’s CPA in the ROC.

• Note 3: The investment gains and losses of the investee company were recognized from the financial statements which have not been reviewed by the parent company’s CPA.

Note 4: The investment gains and losses of Eternal (China) Investment Co., Ltd. included investment income (loss) recognized by the invested company.

Note 5: The amounts were translated into NTD using the current exchange rate.

• Note 6: According to the “Regulation Governing the Approval of Investment or Technical Cooperation in Mainland China”, modified on August 29, 2008, the Company obtained the approval of the operational headquarters from the Industrial Development Bureau of Ministry of Economic Affairs. There is no ceiling for the investment amount.

• Note 7: The divestment was resolved by the board of directors in March 2021, and the liquidation was completed in September 2021.

• 67 -

TABLE 10

Eternal Materials Co., Ltd. and Subsidiaries

INFORMATION OF MAJOR SHAREHOLDERS September 30, 2021

==> picture [498 x 116] intentionally omitted <==

----- Start of picture text -----

Shares
Name of the Major Shareholder Number of Shares Percentage of
Owned Ownership
Kwang Yang Motor Co., Ltd. 124,000,000 9.99
Kao, Ying-Shih 78,287,830 6.31
Kwang Hsing Industrial Co., Ltd. 70,692,000 5.69
----- End of picture text -----

==> picture [498 x 279] intentionally omitted <==

• Note 1: The information of major shareholders presented in this table is provided by the Taiwan Depository & Clearing Corporation based on the number of ordinary shares and preference shares held by shareholders with ownership of 5% or greater, that have been issued without physical registration (including treasury shares) by the Company as of the last business day for the current quarter. The share capital in the consolidated financial statements may differ from the actual number of shares that have been issued without physical registration because of different preparation basis.

• Note 2: If a shareholder delivers the shareholdings to the trust, the above information will be disclosed by the individual truster who opened the trust account. For shareholders who declare insider shareholdings with ownership greater than 10% in accordance with the Security and Exchange Act, the shareholdings include shares held by shareholders and those delivered to the trust over which shareholders have rights to determine the use of trust property. For information relating to insider shareholding declaration, refer to Market Observation Post System.

• 68 -