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Chiu Ting Machinery Co., Ltd. and Subsidiaries

Consolidated Financial Statements for
the Years Ended December 31,2025 and 2024
and Independent Auditors' Report

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REPRESENTATION LETTER

The entities that are required to be included in the combined financial statements of Chiu Ting Machinery Co., Ltd. as of and for the year ended December 31, 2025, under the Criteria Governing the Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises are the same as those included in the consolidated financial statements prepared in conformity with the International Financial Reporting Standard 10, "Consolidated Financial Statements." In addition, the information required to be disclosed in the combined financial statements is included in the consolidated financial statements. Consequently, Chiu Ting Machinery Co., Ltd. and Subsidiaries do not prepare a separate set of combined financial statements.

Very truly yours,

Chiu Ting Machinery Co., Ltd.

Chuang, Po Yen
Chairman

March 11, 2026

Crowe

國富浩華聯合會計師事務所

Crowe (TW) CPAs

403502 台中市西區臺灣大道

二段 285 號 15 樓

15F., No.285, Sec.2, Taiwan

Blvd., West Dist.,

Taichung City 403502, Taiwan

Tel +886 4 36005588

Fax +886 4 36005577

www.crowe.tw

INDEPENDENT AUDITORS' REPORT

The Board of Directors and Shareholders

Chiu Ting Machinery Co., Ltd.

Opinion

We have audited the accompanying consolidated financial statements of Chiu Ting Machinery Co., Ltd. and subsidiaries (“the Group”), which comprise the consolidated balance sheets as of December 31,2025 and 2024, the consolidated statements of comprehensive income, changes in equity, and cash flows for the years then ended, and the notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2025 and 2024, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission (FSC) of the Republic of China (ROC).

Basis for Opinion

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

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Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements for the year ended December 31, 2025. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matters for the Group’s consolidated financial statements for the year ended December 31, 2025 are stated as follows:

1. Credit risk for notes receivable and accounts receivable

Since expected credit loss of notes and accounts receivable is estimated based on receivables that are past due and the relating loss ratio, which are subject to the management’s judgement. Therefore, the credit risk for notes and accounts receivable has been identified as a key audit matter.

Our main audit procedures included reviewing policies and testing their implementation related to expected credit loss assessment of receivables; re-calculating the expected credit loss rate of a provision matrix; obtaining the aging analysis schedule of accounts receivable provided by the management and selecting samples for confirmation, and verifying the accuracy of the overdue aging interval by selected samples; checking whether the impairment loss on provision matrix in accordance with the Group’s policies and verifying the reasonableness of expected credit loss for subsequent collection of receivables by selected samples; assessing the appropriateness about the disclosure of impairment of accounts receivable by the management.

Other Matter

We have also audited the parent company only financial statements of Chiu Ting Machinery Co., Ltd. as of and for the years ended December 31,2025 and 2024 on which we have issued an unmodified opinion.

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

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRS, IAS, IFRIC, and SIC endorsed and issued into effect by Financial Supervisory Commission of the Republic of China, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the

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Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease its operations, or has no realistic alternative but to do so.

Those charged with governance including members of the Audit Committee are responsible for overseeing the Group's financial reporting process.

Auditors' Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Standards on Auditing of the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with the Standards on Auditing of the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We obtain sufficient and appropriate audit evidence regarding the financial information of the

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entities or business units within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of the group audit, including the review of the work performed by component auditors, where applicable, and for determining the group audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements for the year ended December 31,2025 and are therefore the key audit matters. We describe these matters in our auditors' report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors' report are Huang, Chien Chen and Yang, Chen Yu.

CROWE (TW) CPAs
Taichung, Taiwan (Republic of China)

March 11, 2026

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 audit such consolidated financial statements are those generally applied in the Republic of China.

For the convenience of readers, the independent auditors' 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' report and consolidated financial statements shall prevail.

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Chiu Ting Machinery Co., Ltd. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2025 AND 2024

(In Thousands of New Taiwan Dollars)

ASSETS	NOTES	December 31, 2025		December 31, 2024
		Amount	%	Amount	%
CURRENT ASSETS
Cash and cash equivalents	6(1)	$ 489,723	23	$ 549,973	24
Notes receivable, net	6(2) - 7	5	-	1,335	-
Accounts receivable, net	6(3)	64,199	3	97,369	4
Accounts receivable - related parties	7	22,872	1	12,435	1
Other receivables	6(4)	90,878	4	11,924	1
Inventories, net	6(5)	316,215	15	404,814	18
Prepayments		12,440	1	5,702	-
Other financial assets - current	6(6)	424	-	439	-
Other current assets		636	-	321	-
Total current assets		997,392	47	1,084,312	48
NONCURRENT ASSETS
Property, plant and equipment	6(7) - 7	1,126,555	52	1,144,240	51
Right-of-use assets	6(8)	2,009	-	4,151	-
Intangible assets	6(9)	2,476	-	3,334	-
Deferred income tax assets	6(24)	12,022	1	12,972	1
Other noncurrent assets	6(10)	7,653	-	4,137	-
Total noncurrent assets		1,150,715	53	1,168,834	52
TOTAL		$ 2,148,107	100	$ 2,253,146	100
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term loans	6(11)	$ 80,000	4	$ 80,000	4
Contract liabilities - current	6(18)	11,186	1	-	-
Notes payable	6(12)	30,476	1	32,579	2
Accounts payable		161,253	8	197,553	9
Accounts payable - related parties	7	1,262	-	1,291	-
Other payables	6(13)	50,362	2	47,677	2
Current income tax liabilities	6(24)	1,347	-	5,109	-
Lease liabilities - current	6(8)	1,253	-	2,146	-
Long-term liabilities - current portion	6(14)	28,921	1	28,831	1
Other current liabilities		474	-	3,279	-
Total current liabilities		366,534	17	398,465	18
NONCURRENT LIABILITIES
Long term loans	6(14)	166,421	8	195,342	9
Deferred income tax liabilities	6(24)	9,715	-	9,281	-
Lease liabilities - noncurrent	6(8)	805	-	2,058	-
Net defined benefit liability - noncurrent	6(15)	7,374	-	10,423	-
Other noncurrent liabilities - other		344	-	344	-
Total noncurrent liabilities		184,659	8	217,448	9
Total liabilities		551,193	26	615,913	27
EQUITY ATTRIBUTABLE TO SHAREHOLDERS OF THE PARENT
Common stocks	6(16)	653,700	30	653,700	29
Retained earnings	6(17)
Legal capital reserve		170,544	8	161,125	7
Unappropriated earnings		769,603	36	819,311	37
Others		3,067	-	3,097	-
Equity attributable to shareholders of the parent		1,596,914	74	1,637,233	73
Total equity		1,596,914	74	1,637,233	73
TOTAL		$ 2,148,107	100	$ 2,253,146	100

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

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Chiu Ting Machinery Co., Ltd. and Subsidiaries

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR YEARS ENDED DECEMBER 31, 2025 AND 2024

(In Thousands of New Taiwan Dollars, Except Earnings Per Share)

	NOTES	2025		2024
		Amount	%	Amount	%
NET REVENUE	6(18) - 7	$ 1,302,082	100	$ 1,338,821	100
COST OF REVENUE	6(5 - 19) - 7	(1,175,261)	(90)	(1,181,367)	(88)
GROSS PROFIT		126,821	10	157,454	12
OPERATING EXPENSES	6(19) - 7
Marketing		(23,237)	(2)	(24,761)	(2)
General and administrative		(47,141)	(4)	(51,319)	(4)
Research and development		(24,540)	(2)	(24,385)	(2)
Expected credit gains	6(3)	-	-	-	-
Total operating expenses		(94,918)	(8)	(100,465)	(8)
OPERATING PROFIT		31,903	2	56,989	4
NONOPERATING INCOME AND EXPENSES
Interest income	6(20)	6,237	-	11,555	-
Other income	6(21)	8,457	1	8,275	1
Other gains and losses	6(22)	(24,134)	(2)	44,990	3
Finance costs	6(23)	(5,437)	-	(6,525)	1
Total nonoperating income and expenses		(14,877)	(1)	58,295	5
INCOME BEFORE INCOME TAX		17,026	1	115,284	9
INCOME TAX EXPENSE	6(24)	(3,421)	-	(23,070)	(2)
NET INCOME		13,605	1	92,214	7
OTHER COMPREHENSIVE INCOME (LOSS)
Items that will not be reclassified subsequently to profit or loss :
Remeasurement of defined benefit obligation	6(15)	2,089	-	2,463	-
Income tax benefit (expenses) related to items that will not be reclassified subsequently	6(24)	(418)	-	(493)	-
Items that may be reclassified subsequently to profit or loss :
Exchange differences arising on translation of foreign operations		(38)	-	59	-
Income tax benefit (expenses) related to items that may be reclassified subsequently	6(24)	8	-	(12)	-
Other comprehensive income (loss) for the year, net of income tax		1,641	-	2,017	-
TOTAL COMPREHENSIVE INCOME FOR THE YEAR		$ 15,246	1	$ 94,231	7
NET INCOME ATTRIBUTABLE TO :
Shareholders of the parent		$ 13,605	1	$ 92,214	7
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO :
Shareholders of the parent		$ 15,246	1	$ 94,231	7
EARNINGS PER SHARE (IN DOLLARS)	6(25)
Basic earnings per share		$ 0.21		$ 1.41
Diluted earnings per share		$ 0.21		$ 1.41

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

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Chiu Ting Machinery Co., Ltd. and Subsidiaries

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR YEARS ENDED DECEMBER 31, 2025 AND 2024

(In Thousands of New Taiwan Dollars)

Item	Equity Attributable to Shareholders of the Parent
	Common Stocks	Retained Earnings		Others	Total Equity
		Legal Capital Reserve	Unappropriated Earnings	Exchange Differences on Translation of Foreign Financial
BALANCE, JANUARY 1, 2024	$ 653,700	$ 154,740	$ 770,734	$ 3,050	$ 1,582,224
Appropriations of prior year's earnings
Legal capital reserve	-	6,385	(6,385)	-	-
Cash dividends to shareholders - NT$0.60 per share	-	-	(39,222)	-	(39,222)
Net income in 2024	-	-	92,214	-	92,214
Other comprehensive income (loss) in 2024	-	-	1,970	47	2,017
BALANCE, DECEMBER 31, 2024	653,700	161,125	819,311	3,097	1,637,233
Appropriations of prior year's earnings
Legal capital reserve	-	9,419	(9,419)	-	-
Cash dividends to shareholders - NT$0.85 per share	-	-	(55,565)	-	(55,565)
Net income in 2025	-	-	13,605	-	13,605
Other comprehensive income (loss) in 2025	-	-	1,671	(30)	1,641
BALANCE, December 31, 2025	$ 653,700	$ 170,544	$ 769,603	$ 3,067	$ 1,596,914

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

Chiu Ting Machinery Co., Ltd. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR YEARS ENDED DECEMBER 31, 2025 AND 2024

(In Thousands of New Taiwan Dollars)

	2025	2024
CASH FLOWS FROM OPERATING ACTIVITIES
Income before income tax	$ 17,026	$ 115,284
Adjustments to reconcile profit (loss)
Depreciation	47,392	49,781
Amortization	2,707	3,570
Expected credit gains	-	-
Interest income	(6,237)	(11,555)
Interest expense	5,437	6,525
Gain on disposal of property, plant and equipment	(153)	(375)
Changes in operating assets and liabilities
Notes receivable	1,330	(50)
Accounts receivable	(57,643)	217,805
Other receivables	1,422	1,603
Inventories	88,599	(5,585)
Prepayments	(6,738)	771
Other current assets	(315)	86
Contract liabilities - current	11,186	-
Notes payable	363	(25,603)
Accounts payable	(36,329)	(54,407)
Other payables	(5,202)	(459)
Other current liabilities	(2,805)	1,019
Net defined benefit liability	(960)	(968)
Cash provided from operations	59,080	297,442
Interest received	6,237	11,555
Interest paid	(5,443)	(6,655)
Income taxes paid	(6,209)	(39,114)
Net cash provided by operating activities	53,665	263,228
CASH FLOWS FROM INVESTING ACTIVITIES
Decrease in other financial assets	15	9,179
Acquisition of property, plant and equipment	(19,710)	(21,276)
Disposal of property, plant and equipment	191	762
Increase in refundable deposits	-	(1,010)
Increase in intangible assets	(2,954)	(882)
Increase in prepaid equipment	(2,560)	-
Increase in other non-current assets	(2,317)	(1,140)
Net cash used in investing activities	(27,335)	(14,367)

(Continued)

Chiu Ting Machinery Co., Ltd. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR YEARS ENDED DECEMBER 31, 2025 AND 2024

(In Thousands of New Taiwan Dollars)

	2025	2024
CASH FLOWS FROM FINANCING ACTIVITIES
Decrease in short-term loans	$ -	$ (50,000)
Repayment of long-term loans	(28,831)	(167,454)
Cash dividends paid	(55,565)	(39,222)
Repayment of the principal portion of lease liabilities	(2,146)	(1,349)
Net cash used in financing activities	(86,542)	(258,025)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	(38)	59
NET DECREASE IN CASH AND CASH EQUIVALENTS	(60,250)	(9,105)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR	549,973	559,078
CASH AND CASH EQUIVALENTS, END OF YEAR	$ 489,723	$ 549,973

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

(Concluded)

Chiu Ting Machinery Co., Ltd. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

(Amounts in Thousands of New Taiwan Dollars, Unless Specified Otherwise)

1. ORGANIZATION AND OPERATIONS

Chiu Ting Machinery Co., Ltd. (the "Company") was incorporated on August, 1981. The address of its registered office and principal place of business is No. 78, Yongfeng Rd., Taiping Dist., Taichung City, Taiwan. The Company and its subsidiaries (the "Group") mainly engage in manufacturing and sale of planers, jointers, table saws, shapers, wood lathes, woodworking machinery parts, and power tools.

The Company obtained approval from the Securities and Futures Bureau (SFB), Financial Supervisory Commission (FSC) to become a public company on November 4, 1998. Since May 14, 2001, the Company's stocks have been listed on the Taipei Exchange ("TPEx"). Since October 29, 2002, the Company's stocks have been listed on the Taiwan Stock Exchange ("TWSE"). The principal operating activities of the subsidiaries are described in Note 4.3.

2. THE AUTHORIZATION OF FINANCIAL STATEMENTS

The accompanying consolidated financial statements were approved and authorized for issuance by the Board of Directors on March 11, 2026.

3. APPLICATION OF NEW STANDARDS, AMENDMENTS, AND INTERPRETATIONS

3.1 Effect of the adoption of 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):

New standards, interpretations and amendments endorsed by the FSC effective from 2025 are as follows:

New IFRSs	Effective Date Announced by IASB
Amendments to IAS 21, "Lack of Exchangeability"	January 1, 2025

(1) Amendments to IAS 21 "Lack of Exchangeability"

This amendment defines exchangeability and provides guidance on how an entity should determine the spot exchange rate when a particular currency lacks exchangeability. In addition, this amendment requires entities to provide more useful information in their financial statements when a currency cannot be exchanged for another currency.

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The above standards and interpretations have no significant impact to the consolidated financial position and consolidated financial performance based on the Group's assessment.

3.2 The IFRSs issued by International Accounting Standards Board (IASB) and endorsed by FSC with effective date starting 2026

New standards, interpretations and amendments endorsed by the FSC and effective from 2026 are as follows:

New IFRSs	Effective Date Announced by IASB
Amendments to IFRS 9 and IFRS 7 “Amendments to the Classification and Measurement of Financial Instruments”	January 1, 2026
Amendments to IFRS 9 and IFRS 7 “Contracts Referencing Nature-dependent Electricity”	January 1, 2026
IFRS 17 “Insurance Contracts”	January 1, 2023
Amendments to IFRS 17 “Insurance Contracts”	January 1, 2023
Amendments to IFRS 17 “Initial Application of IFRS 17 and IFRS 9—Comparative Information”	January 1, 2023
Annual Improvements to IFRS Accounting Standards—Volume 11	January 1, 2026

(1) Amendments to IFRS 9 and IFRS 7 “Amendments to the Classification and Measurement of Financial Instruments”

A. Clarifies and provides additional guidance on assessing whether a financial asset meets the solely payments of principal and interest (SPPI) criterion. The scope includes contractual terms that may alter cash flows based on contingent events (e.g., interest rates linked to ESG targets), instruments with nonrecourse features, and contractually linked instruments.

B. Introduce new disclosure requirements for certain instruments with contractual terms that may alter cash flows (e.g., instruments with features linked to the achievement of environmental, social, and governance (ESG) targets). These disclosures include a qualitative description of the nature of the contingent event, quantitative information on the potential changes in contractual cash flows resulting from these contractual terms, and the gross carrying amount of financial assets and the amortized cost of financial liabilities subject to these contractual terms.

C. Clarifies the recognition and derecognition dates for certain financial assets and liabilities, and adds that when using an electronic payment system to settle financial liabilities (or part of financial liabilities) in cash, an entity is permitted to consider the financial liability as derecognized prior to the settlement date only when the entity initiates a payment instruction that results in the following circumstances:

(a) The entity does not have the ability to revoke, stop, or cancel the specified payment.

(b) The entity, as a result of the payment instruction, does not have the actual ability to obtain the cash used for settlement.; and

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D. Update regarding the irrevocable designation of equity instruments measured at fair value through other comprehensive income (FVTOCI): the fair value should be disclosed by each category, and it is no longer required to disclose fair value information for each individual item. In addition, the amount of gains or losses on fair value recognized in other comprehensive income during the reporting period should be disclosed, separately presenting the amount related to investments derecognized during the reporting period and the amount related to investments still held at the end of the reporting period. Furthermore, the cumulative gains or losses transferred to equity due to the derecognition of investments during the reporting period should be disclosed.

(2) Amendments to IFRS 9 and IFRS 7 “Contracts Referencing Nature-dependent Electricity”

The amendment addresses contracts in which a company is involved and where electricity generation depends on uncontrollable natural conditions (such as weather), resulting in fluctuations in electricity output. The details are explained as follows:

A. Clarifying the application of the ‘own use’ requirements for contracts to buy or sell nature-dependent electricity:

When a contract requires a company to purchase and receive electricity during power generation, and the design and operation of the contract electricity trading market require the company to sell any unused electricity within a specified period, the company must consider reasonable and supported information regarding past, current, and expected future electricity transactions within a reasonable period not exceeding 12 months. If the company purchases enough electricity to offset any unused electricity sold in the same market, the company is considered a net purchaser of electricity.

A company applying these amendments to own-use contracts involving nature-dependent electricity shall disclose the following:

(a) Fluctuations in base electricity volume and risk being required to purchase electricity during delivery intervals when power cannot be used.

(b) Unrecognized contractual commitments, including the expected future cash flows from purchasing electricity under these contracts; and

B. Clarifying the application of hedge accounting for contracts involving nature-dependent electricity as hedging instruments:

The hedged item may be designated as the variable notional amount of forecasted electricity transactions, which is consistent with the variable amount of natural electricity expected to be delivered by the power generation facilities referenced in the hedging instrument. Furthermore, when the cash flows of the hedging instrument are designated in a cash flow hedge relationship, and when a contract involving natural electricity is designated as the hedging instrument conditional on the occurrence of the designated forecast transaction, that forecast transaction is presumed to be highly

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probable. For entities that designate contracts involving nature-dependent electricity as hedging instruments, the terms and conditions of such hedging instruments shall be disclosed by risk category in accordance with IFRS 7.

As of the date the accompanying consolidated financial statements are authorized for issue, the Group is still evaluating the impact on its financial position and financial performance as a result of the initial adoption of the aforementioned standards or interpretations. The related impact will be disclosed when the Group completes the evaluation.

3.3 IFRSs issued by IASB but not yet endorsed and issued into effect by the FSC:

New standards, interpretations and amendments issued by IASB but not yet included in the IFRSs as endorsed by the FSC are as follows:

New IFRSs	Effective Date Announced by IASB
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture”	To be determined by IASB
IFRS 18 “Presentation and Disclosure in Financial Statements”	January 1, 2027(Note)
IFRS 19 “Subsidiaries without Public Accountability: Disclosures”	January 1, 2027
Amendments to IAS 21 – Translation into a Hyperinflationary Currency	January 1, 2027

Note: On September 25, 2025, the FSC announced that IFRS 18 will take effect starting from January 1, 2028. Domestic entities could elect to apply IFRS 18 for an earlier period after the endorsement of IFRS 18 by the FSC.

Except as noted below, based on the Group's assessment, the above standards and interpretations do not have a significant impact on the Group's financial position and financial performance.

(1) Amendments to IFRS 10 and IAS 28 "Sale or Contribution of Assets between An Investor and Its Associate or Joint Venture"

The amendments address an existing inconsistency between IFRS 10 and IAS 28. The recognition of a gain or loss arising from the sale or contribution of assets between an investor and its associate or joint venture depends on the nature of the assets transferred:

A. If the assets sold or contributed constitute a business, the full gain or loss is recognized ;
B. If the assets sold or contributed do not constitute a business, the gain or loss is recognized only to the extent of the investor's interest that is not attributable to related parties in the associate or joint venture.

(2) IFRS 18 "Presentation and Disclosure in Financial Statements"

IFRS 18, Presentation and Disclosure in Financial Statements, replaces IAS 1. The standard introduces a structured format for the statement of profit or loss, disclosure

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requirements for management-defined performance measures, and enhanced principles on aggregation and disaggregation applicable to the primary financial statements and notes.

(3) IFRS 19 “Subsidiaries without Public Accountability : Disclosure”

The standard allows eligible subsidiaries to apply IFRSs with reduced disclosure requirements.

(4) Amendments to IAS 21 – Translation into a Hyperinflationary Currency

The amendments require that when translating from a functional currency of a non-hyperinflationary economy into a presentation currency of a hyperinflationary economy, all amounts (including comparative information) shall be translated using the closing exchange rate at the end of the most recent reporting period. The amendments also provide an exception whereby entities whose functional currency and presentation currency are both currencies of hyperinflationary economies are not required to retranslate comparative information when their foreign operations have a functional currency of a non-hyperinflationary economy. In addition, the amendments introduce disclosure requirements, including the translation method applied and summarized financial information of foreign operations.

4. SUMMARY OF MATERIAL ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of these consolidated financial statements are set out below. These policies have been applied consistently across all reporting periods unless otherwise stated.

4.1 Statement of Compliance

The accompanying consolidated financial statements have been prepared in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the IFRSs endorsed by the FSC with the effective dates.

4.2 Basis of Preparation

(1) Except for the following significant items, the accompanying consolidated financial statements have been prepared on the historical cost basis:

A. Financial assets and liabilities at fair value through profit or loss (including derivative financial instruments).

B. Financial assets and liabilities at fair value through other comprehensive income.

C. Defined benefit liabilities recognized based on the net amount of pension fund assets less present value of defined benefit obligation.

(2) The preparation of consolidated financial statements in conformity with IFRSs

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endorsed by the FSC requires the use of certain critical accounting estimates. It also requires the management to exercise its judgment in the process of applying the Group's accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.

4.3 Basis of consolidation

(1) Basis for preparation of consolidated financial statements:

A. All subsidiaries are included in the Group's consolidated financial statements. Subsidiaries are all entities (including structured entities) controlled by the Group. The Group controls an entity when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Consolidation of subsidiaries begins from the date the Group obtains control of the subsidiaries and ceases when the Group loses control of the subsidiaries.

B. Inter-company transactions, balances and unrealized gains or losses on transactions between companies within the Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Group.

C. Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non-controlling interests. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

D. Changes in a parent's ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary are accounted for as equity transactions. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity.

E. When the Group loses control of a subsidiary, the Group remeasures any investment retained in the former subsidiary at its fair value. That fair value is regarded as the fair value on initial recognition of a financial asset or the cost on initial recognition of the associate or joint venture. Any difference between fair value and carrying amount is recognized in profit or loss. All amounts previously recognized in other comprehensive income in relation to the subsidiary are reclassified to profit or loss or transferred directly to retained earnings as appropriate, on the same basis as would be required if the related assets or liabilities were disposed of. That is, when the Group loses control of a subsidiary, all gains or losses previously recognized in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss, if such gains or losses would be reclassified to profit or loss when the related assets or

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liabilities are disposed of.

(2)Subsidiaries included in the consolidated financial statements:

Name of investor	Name of subsidiary	Main business activities	Percentage of Ownership
			December 31,2025	December 31,2024
The Company	CHIU TING MACHINERY(BVI) CO., LTD. (CHIU TING (BVI))	Investing activities	100%	100%

The subsidiaries consolidated in the consolidated financial statements of 2025 and 2024 were audited by the Company's independent auditors.

(3)Subsidiaries excluded from the consolidated financial statements: None.

4.4 Foreign Currencies

(1) Items included in the financial statements of each of the Group's entities are measured using the functional currency of each entity. The consolidated financial statements are presented in New Taiwan Dollars, which is the Group's functional currency.

(2) In preparing the financial statements of each individual consolidated entity, transactions in currencies other than the entity's functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing on that date. Such exchange differences are recognized in profit or loss in the year in which they arise. Non-monetary items measured at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Exchange differences arising in the retranslation of non-monetary items are included in profit or loss for the year except for exchange differences arising in the retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income, in which case, the exchange difference are also recognized directly in other comprehensive income. Non-monetary items that are measured in terms of historical cost in foreign currencies are translated using the exchange rate at the date of the transaction and are not retranslated.

(3) When preparing the consolidated financial statements, the assets and liabilities of the Group's foreign operations are translated into NT$ using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period. Exchange differences arising, if any, are recognized in other comprehensive income and accumulated in equity and are attributed to noncontrolling interests as appropriate.

4.5 Classification of Current and Noncurrent Assets and Liabilities

(1) Assets that meet one of the following criteria are classified as current assets:

A. Assets arising from operating activities that are expected to be realized, or are intended to be sold or consumed within the normal operating cycle;

B. Assets held mainly for trading purposes;

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C. Assets that are expected to be realized within twelve months from the end of reporting period.

D. Cash and cash equivalents, excluding restricted cash and cash equivalents and those intended to be exchanged or used to settle liabilities more than twelve months after the end of reporting period.

The Group classifies all assets that do not meet the above criteria as non-current.

(2) Liabilities that meet one of the following criteria are classified as current liabilities:

A. Liabilities that are expected to be settled within the normal operating cycle;

B. Liabilities arising mainly from trading activities;

C. Liabilities due to be settled within twelve months after the reporting period, even if an agreement to refinance, or to reschedule payments on a long-term basis is completed after the reporting period and before the consolidated financial statements are authorized for issue; and

D. Liabilities for which there is no substantive right at the balance sheet date to defer settlement for at least twelve months after the balance sheet date. The classification of a liability is not affected if its terms allow the counterparty to settle it by issuing equity instruments at their discretion.

The Group classifies all liabilities that do not meet the above conditions as non-current.

4.6 Cash and cash equivalents

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

4.7 Financial Instruments

Financial assets and liabilities shall be recognized when the Group becomes a party of the contractual provisions of the instruments.

Financial assets and liabilities are initially recognized at fair values. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

(1) Financial assets

A. Measurement categories

All regular way purchases or sales of financial assets are recognized and derecognized using trade date accounting.

Financial assets are classified as financial assets at FVTPL and financial assets at amortized cost.

(a) Financial assets at FVTPL

Financial assets at FVTPL include financial assets mandatorily classified as at

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FVTPL and financial assets designated as at FVTPL. Financial assets mandatorily classified as at FVTPL include investments in equity instruments that are not designated as at fair value through other comprehensive income (FVTOCI) and debt instruments that do not meet the criteria for being classified as at amortized cost or as at FVTOCI.

Financial assets at FVTPL are stated at fair value, any dividends earned recognized as other income, and interest earned and gains or losses arising from remeasurement recognized in other gains or losses. Fair value is determined in the manner described in Note 12.

(b) Financial assets at amortized cost

Financial assets that meet the following conditions are subsequently measured at amortized cost:

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

Subsequent to initial recognition, financial assets at amortized cost are measured at amortized cost, which equals to gross carrying amount determined by the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

Interest income is calculated by applying the effective interest rate to the gross carrying amount of the financial asset, except for:

i. Purchased or originated credit-impaired financial asset, for which interest income is calculated by applying the credit-adjusted effective interest rate to the amortized cost of the financial asset; and
ii. Financial asset that has subsequently become credit-impaired, for which interest income is calculated by applying the effective interest rate to the amortized cost of the financial asset.

B. Impairment of financial assets

(a) The Group recognizes loss allowances for expected credit losses on financial assets at amortized cost (including trade receivables), and contract assets.
(b) The Group recognizes loss allowances at an amount equal to lifetime expected credit losses (i.e. ECLs) for accounts receivable and contract assets. For all other financial instruments, the Group recognizes lifetime ECLs for which there has been a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk of the financial instrument has not increased significantly since initial recognition, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month ECL.
(c) Expected credit losses reflect the weighted average of credit losses with the

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respective risks of a default occurring as the weights. Lifetime ECLs represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument. In contrast, 12-month ECLs represents the portion of lifetime ECLs that is expected to result from default events on a financial instrument that are possible within 12 months after the reporting date.

(d) The Group recognizes an impairment loss in profit or loss for all financial instruments with a corresponding adjustment to their carrying amount through a loss allowance account, except for debt investment that are measured at FVTOCI, for which the loss allowance is recognized in other comprehensive income and does not reduce the carrying amount of the financial asset.

C. Derecognition of financial assets

The Group derecognizes a financial asset when one of the following conditions is met:

(a) The contractual rights to receive cash flows from the financial asset expired.

(b) The contractual rights to receive cash flows from the financial asset which have been transferred and the Group has transferred substantially all risks and rewards of ownership of the financial asset.

(c) The Group neither retains nor transfers substantially all risks and rewards of ownership of the financial asset; however, it has not retained control of the financial asset.

On derecognition of a financial asset at amortized cost in its entirety, the difference between the carrying amount of financial asset and the sum of the consideration received and receivable is recognized in profit or loss.

(2) Equity instruments

Debt and equity instruments issued by the Group are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Group are recognized at the proceeds received, net of direct issue costs.

(3) Financial liabilities

A. Subsequent measurement

Except for the following situations, all financial liabilities are measured at amortized cost using the effective interest method:

(a) Financial liabilities at fair value through profit or loss are financial liabilities held for trading or financial liabilities designated as at fair value through profit or loss on initial recognition. A financial liability is classified as held for trading if it is incurred principally for the purpose of repurchasing it in the near term. Derivatives are also categorized as financial liabilities held for trading unless

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they are financial guarantee contracts or designated and effective hedging derivatives.

(b) Financial liabilities at fair value through profit or loss are initially recognized at fair value. Related transaction costs are expensed in profit or loss. These financial liabilities are subsequently remeasured at fair value, and any changes in the fair value of these financial liabilities are recognized in profit or loss.

B. Derecognition of financial liabilities

The Group derecognizes a financial liability when, and only when, it is extinguished—i.e. when the obligation is discharged or cancelled or expires. The difference between the carrying amount of a financial liability derecognized and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss.

(4) Modification of Financial Instruments

When the contractual cash flows of a financial instrument are renegotiated or modified and the renegotiation or modification does not result in the derecognition of that financial instrument, the Group recalculates the gross carrying amount of the financial asset or the amortized cost of the financial liabilities using the original effective interest rate and recognizes a modification gain or loss in profit or loss. Any costs or fees incurred adjust the carrying amount of the modified financial instrument and are amortized over the remaining term of the modified financial instrument. If the renegotiation or modification results in that the derecognition of that financial instrument is required, then the financial instrument is derecognized accordingly.

If the basis for determining the contractual cash flows of a financial asset or financial liability changes resulting from interest rate benchmark reform and the change is necessary as a direct consequence of interest rate benchmark reform and the new basis for determining the contractual cash flows is economically equivalent to the previous basis, the Group applies the practical expedient to account for that change as a change in effective interest rate. If changes are made to a financial asset or financial liability in addition to changes to the basis for determining the contractual cash flows required by interest rate benchmark reform, the Group first applies the practical expedient aforementioned to the changes required by interest rate benchmark reform, and then applies the applicable requirements to any additional changes to which that practical expedient does not apply.

4.8 Inventories

Inventories are measured at the lower of cost and net realizable value. Cost is determined using the weighted average method. The cost of finished goods and work in progress comprises raw materials, direct labor, other direct costs and related production overheads (allocated based on normal operating capacity), excluding borrowing costs. The item-by-item approach is used in applying the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less all estimated

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costs of completion and costs necessary to make the sale.

4.9 Property, Plant and Equipment

(1) Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalized. For property, plant and equipment under construction, sample produced from testing whether the asset is functioning properly before its intended use are measured at lower of the costs or net realizable value. Proceeds from selling such an item and the cost of the item are recognized in profit or loss.

(2) Subsequent costs are included in the carrying amount of asset or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other repair and maintenance expenses are recognized in profit or loss as incurred.

(3) Land is not depreciated. Other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. The residual values of assets, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year-end. If expectations for the residual values of assets and useful lives differ from previous estimates or the patterns of consumption of the future economic benefits of assets embodied in the assets which have changed significantly, any change is accounted for as a change in accounting estimate under IAS 8, 'Accounting Policies, Changes in Accounting Estimates and Errors', from the date of the change.

The estimated useful lives of property, plant and equipment are as follows:

Buildings	10~55 years
Machinery	5~20 years
Other equipment	3~15 years

(4) An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the assets. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.

4.10 Leases

At the inception of a contract, the Group evaluates a contract to determine whether it is or contains a lease component. For a contract that contains a lease component and one or more additional lease or non-lease components, a lessee shall allocate the consideration in the contract to each lease component on the basis of the relative stand-alone price of the lease component and the aggregate stand-alone price of the non-lease components.

(1) The Group as lessee

Except for payments for low-value asset leases and short-term leases which are recognized as expenses on a straight-line basis, the Group recognizes right-of-use

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assets and lease liabilities for all leases at the commencement date of the lease.

Right-of-use assets

Right-of-use assets are initially measured at cost, which comprises the initial measurement of lease liabilities adjusted for lease payments made at or before the commencement date, less any lease incentives received, and plus any initial direct costs incurred and an estimate of costs needed to restore the underlying assets. Subsequent measurement is calculated as cost less accumulated depreciation and accumulated impairment loss and adjusted for any remeasurement of the lease liabilities.

Right-of-use assets are presented as a separate line item in the consolidated balance sheets, except for those that meet the definition of investment properties.

Right-of-use assets are depreciated using the straight-line method from the commencement dates to the earlier of the end of the useful lives of the right-of-use assets or the end of the lease terms.

Lease liabilities

Lease liabilities are measured at the present value of the lease payments. The lease payments shall be discounted using the interest rate implicit in the lease if that rate can be readily determined. If that rate cannot be readily determined, the Group shall use the lessee's incremental borrowing rate.

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. If there is a change in a lease term, the Group shall remeasure the lease liabilities with a corresponding adjustment to the right-of-use assets. However, if the carrying amount of the right-of-use asset is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. For a lease modification that is not accounted for as a separate lease, the Group accounts for the remeasurement of the lease liability by decreasing the carrying amount of the right-of-use asset to reflect the partial or full termination of the lease for lease modifications that decrease the scope of the lease. The lessee shall recognize in profit or loss any gain or loss relating to the partial or full termination of the lease and making a corresponding adjustment to the right-of-use asset for all other lease modifications. Lease liabilities are presented as a separate line item in the consolidated balance sheets.

(2) The Group as lessor

Leases are classified as finance leases whenever the terms of a lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

Under operating leases, lease payments, less any lease incentives payable, are recognized as lease income on a straight-line basis over the lease terms. Initial direct costs incurred in obtaining operating leases are added to the carrying amounts of the underlying assets and recognized those costs as an expense over the lease term on the

~ 24 ~

same basis as the lease income.

4.11 Intangible Assets

Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortization and accumulated impairment loss. Amortization is recognized on a straight-line basis over the following estimated lives: patents 10 to 20 years; computer software 2 to 3 years. The estimated useful life and amortization method are reviewed at each financial year-end, with the effect of any changes in estimates being accounted for on a prospective basis.

An item of intangible assets is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the assets. Any gain or loss arising on the disposal or retirement of an item of intangible assets is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.

4.12 Impairment of non-financial assets

The Group assesses at the end of reporting period the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by which the carrying amount of asset exceeds its recoverable amount. The recoverable amount is the higher of a fair value of asset less costs to sell or value in use. When the indication of impairment loss recognized in prior years for an asset no longer exist, the impairment loss is reversed to the extent of the loss previously recognized in profit or loss.

When an impairment loss subsequently reverses, the carrying amount of the asset or a cash-generating unit is increased to the revised estimate of its recoverable amount, but the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset or cash-generating unit in prior years.

4.13 Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, and it is probable that an outflow of economic resources will be required to settle the obligation and the amount of the obligation can be reliably estimated. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation on the balance sheet date. The discount rate shall be a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. Where discounting is used, the carrying amount of a provision increases in each period to reflect the passage of time. This increase is recognised as interest expense. Provisions are not recognised for future operating losses.

4.14 Employee Benefits

(1) Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period

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and should be recognized as expenses in that period when the employees render service.

(2) Pensions

A. Defined contribution plans

For defined contribution plans, the contributions are recognized as pension expenses when they are due on an accrual basis. Prepaid contributions are recognized as an asset to the extent of a cash refund or a reduction in the future payments.

B. Defined benefit plans

(a) Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employee will receive on retirement for their services with the Group in current period or prior period. The liability recognized in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The defined benefit net obligation is calculated annually by independent actuaries using the projected unit credit method. The discount rate used is determined by using the market yields (at the end of the reporting period) on government bonds denominated in the currency in which the benefits are to be paid. The currency and term of the government bonds are consistent with the currency and estimated term of the obligation.

(b) Remeasurement arising on defined benefit plans is recognized in other comprehensive income in the period in which they arise and are recorded as retained earnings.

(3) Employees' compensation and directors' remuneration

Employees' compensation and directors' remuneration are recognized as expense and liability, provided that such recognition is required under legal or constructive obligation and the amount can be reliably estimated. Any differences between the amount accrued and the amount actually distributed is accounted for a change in accounting estimate.

(4) Termination benefits

Termination benefits are employee benefits provided in exchange for the termination of employment as a result from either the Group's decision to terminate an employee's employment before the normal retirement date, or an employee's decision to accept an offer of redundancy benefits in exchange for the termination of employment. The Group recognizes expense when it can no longer withdraw an offer of termination benefits or it recognizes related restructuring costs, whichever is earlier. Benefits that are expected to be due more than 12 months after balance sheet date shall be discounted to their present value.

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4.15 Capital Stock

Common stock is classified as equity. Incremental costs directly attributable to the issue of new shares or share options are recorded as a deduction in equity.

4.16 Income Tax

(1) The tax expense for the year comprises current and deferred tax. Tax is recognized in profit or loss, except to the extent that it relates to items recognized in other comprehensive income or items recognized directly in equity, in which cases the tax is recognized in other comprehensive income or equity, respectively.

(2) The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the end of the financial reporting period in the countries where the Company operates and generate taxable income. The management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. According to Income Tax Act of ROC, an additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the subsequent year when the stockholders approve to distribute retain earnings.

(3) Deferred income tax is recognized, using the balance sheet method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, the deferred income tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting or taxable profit nor loss, and it does not give rise to equal deductible and taxable temporary differences at the time of transaction. Deferred tax is provided on temporary differences arising on investments in subsidiaries, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the financial reporting period and are expected to apply when the related deferred tax asset is realized, or the deferred tax liability is settled.

(4) Deferred income tax assets are recognized only to the extent that unused tax losses and unused tax credits that it is probable that future taxable profit will be available against which the temporary differences can be utilized. At the end of each reporting period, unrecognized and recognized deferred tax assets are reassessed.

(5) Current income tax assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. Deferred income tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets

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against current tax liabilities and they are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realize the asset and settle the liability simultaneously.

4.17 Revenue Recognition

The Group recognizes revenue based on the principle of revenue from customer contracts by applying the following steps:

(1) Identify the contract with the customer;
(2) Identify the performance obligations in the contract;
(3) Determine the transaction price;
(4) Allocate the transaction price to the performance obligations in the contracts; and
(5) Recognize revenue when the entity satisfies a performance obligation.

The Group identifies performance obligations in a contract with the customer, allocates the transaction price to the performance obligations and recognizes revenue when performance obligations are satisfied.

For contracts where the period between the transfer of goods or services and the receipt of consideration is one year or less, the Group does not adjust the transaction price for the effects of a significant financing component.

(1) Revenue from sale of goods

Revenue from the sale of goods comes from sales of woodworking machine and others. Revenue is recognized when control of the products has transferred because it is the time when the customer has full discretion over the manner of distribution and over the price to sell the goods, has primary responsibility for sales to future customers, and bears the risks of obsolescence. Accounts receivable are recognized concurrently. Revenue is reduced for estimated customer returns, rebates and other similar allowances.

The Group does not recognize sales revenue on materials delivered to processing subcontractors due to the delivery does not transfer control of materials.

(2) Revenue from rendering of services

Revenue from services is recognized when services are provided by reference to the stage of completion of the services provided.

4.18 Borrowing Costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets are capitalized as part of the cost of those assets until substantially all the activities necessary to prepare the qualifying asset for its intended use or sale are complete.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.

Except for those qualifying capitalization, all other borrowing costs are recognized as an expense in profit or loss as incurred.

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4.19 Government Grants

Government grants are recognized at their fair value only when there is reasonable assurance that the Group will comply with any conditions attached to the grants and the grants will be received.

Government grants are recognized in profit or loss on a systematic basis over the periods in which the Group recognizes expenses for the related costs for which the grants are intended to compensate. A government grant that becomes receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the Group with no future related costs is recognized in profit or loss of the period in which it becomes receivable.

It of a government loan at a the below-market rate of interest is treated as a government grant and is measured as the difference between the proceeds received and the fair value of the loan at the market rate.

CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION AND UNCERTAINTY

The Group takes into account the economic impact of Reciprocal Tariff Measures Implemented by the United States on significant accounting estimates and reviews the basic assumptions and estimation on an ongoing basis. If a change in accounting estimate affects only the current period, the effect is recognized in the current period. If a change in accounting estimate affects both current and future periods, the effects are recognized in both periods.

The preparation of these Group's consolidated financial statements in applying the Group's accounting policies and making critical assumptions and estimates are consisted of the following:

5.1 Critical judgments in applying accounting policies

(1) Business model assessment of financial assets

The Group determines the business model at a level that reflects how groups of financial assets are managed together to achieve a particular business objective. The Group applies judgement and considers relevant factors such as the measurement of assets performing, the risks affected by the performance and the regulations for related manager's remuneration. The Group monitors the fair value through profit or loss financial assets that are derecognized prior to their maturity to assess whether the purpose of derecognition is consistent with the business model's. If there has been a change in the business model, the Group shall postpone the adjustment of the reclassifications of financial assets in accordance with IFRS 9.

5.2 Critical accounting estimation and assumption

(1) Estimated impairment of financial assets

The provision for impairment of accounts receivable and debt investments is based on assumptions on risk of default and expected loss rates. The Group makes these assumptions and selects inputs for the impairment calculation, based on the Group's historical experience and existing market conditions, as well as forward looking

~ 29 ~

information. Where the actual future cash inflows are less than expected, a material impairment loss may arise.

(2) Evaluation of inventories

As inventories are stated at the lower of cost or net realizable value, and the Group uses judgements and actuarial assumptions to determine the net realizable value of inventory at the end of each reporting period. The Group estimates the net realizable value of inventory for obsolescence and unmarketable items at the end of reporting period, and then writes down the cost of inventories to net realizable value. Such an evaluation of inventories is mainly based on the demand for the products within a specified period in the future. Therefore, there might be material changes to the evaluation.

(3) Impairment of tangible and intangible assets

In the course of impairment assessments, the Group determines, based on how assets are utilized and relevant industrial characteristics, the useful lives of assets and the future cash flows of a specific group of the assets. Changes in economic circumstances or the Group's strategy might result in material impairment of assets in the future.

(4) Realizability of deferred tax assets

Deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available against which those deferred tax assets can be utilized. The Group's management assesses the realizability of deferred tax assets by making critical accounting judgements and significant estimates of expected future revenue growth rate and gross profit rate, the tax exemption period, available tax credits, and tax planning, etc. Any changes in the global economic environment, the industry trends and relevant laws and regulations could result in significant adjustments to the deferred tax assets.

(5) Calculation of accrued pension obligations

When calculating the present value of defined pension obligations, the Group uses judgements and actuarial assumptions to determine related estimates, including discount rates and future salary increase rate at the end of reporting period. Any changes in these assumptions may have a significantly impact on the carrying amount of defined pension obligation.

6. CONTENTS OF SIGNIFICANT ACCOUNTS

6.1 CASH AND CASH EQUIVALENTS

Items	December 31, 2025	December 31, 2024
Cash on hand and petty cash	$ 411	$ 421
Checking accounts and demand deposits	442,167	451,197
Time deposits	47,145	98,335
Total	$ 489,723	$ 549,973

(1) Pledged deposits of the Group was classified as other financial assets- current.

(2) Please refer to Note 12 for related credit risk management and assessment.

6.2 NOTES RECEIVABLE, NET

Items	December 31, 2025	December 31, 2024
Amortized at cost
Gross carrying amount	$ 5	$ 1,335
Less: Loss allowance	-	-
Notes receivable, net	$ 5	$ 1,335

(1) Notes receivable of the Group are not pledged to others.
(2) Please refer to Note 6.3 for information on loss allowance for notes receivable.

6.3 ACCOUNTS RECEIVABLE, NET

Items	December 31, 2025	December 31, 2024
Amortized at cost
Gross carrying amount	$ 64,199	$ 97,369
Less: Loss allowance	-	-
Accounts receivable, net	$ 64,199	$ 97,369

(1) The average credit period of sales of goods ranges from 14 to 120 days, which is determined by reference to the credit granting policy based on the counterparties' industrial characteristics, operation scales and profitability.
(2) Accounts receivable of the Group are not pledged to others.
(3) Accounts receivable measured at amortized cost

The Group applies the simplified approach to providing expected credit losses prescribed under IFRS 9, which permits the use of lifetime expected loss provision for all trade receivables. The expected credit losses are estimated using an allowance matrix with reference to past default experiences of the debtor, an analysis of the debtor's current financial position, adjusted for general economic conditions of the industry in which the debtors operate. The allowance matrix for loss allowance based on past due status is not further distinguished according to the Group's different customer base.

A. The following table detailed the loss allowance of notes and accounts receivable based on the Group's provision matrix (include related parties).

December 31, 2025

Aging terms	Gross carrying amount	Loss allowance (lifetime ECLs)	Amortized cost
Not past due	$ 84,843	$ -	$ 84,843
Past due 1-90 days	2,233	-	2,233

December 31, 2025

Aging terms	Gross carrying amount	Loss allowance (lifetime ECLs)	Amortized cost
Total	$ 87,076	$ -	$ 87,076

December 31, 2024

Aging terms	Gross carrying amount	Loss allowance (lifetime ECLs)	Amortized cost
Not past due	$ 98,529	$ -	$ 98,529
Past due 1-90 days	11,751	-	11,751
Past due 91-180 days	859	-	859
Total	$ 111,139	$ -	$ 111,139

The Group has not held any collateral or other credit enhancement for accounts receivable as stated above.

B. Movements of the loss allowance for notes and accounts receivable.

Items	2025	2024
Balance, January 1	$ -	$ -
Add: Provision for (Reversal of) impairment	-	-
Balance, December 31	$ -	$ -

C. Please refer to Note 12 for information on the Group's management and measurement policies of credit risk.

6.4 OTHER RECEIVABLES

Items	December 31, 2025	December 31, 2024
Accounts receivable factoring	$ 83,126	$ 2,750
Tax refund receivable	6,442	7,847
Others	1,310	1,327
Total	$ 90,878	$ 11,924

Accounts receivable factoring represents the amounts are factored but not utilized. Please refer to Note 12.5 for the relevant information on the transfer of financial assets.

6.5 INVENTORIES AND COST OF GOODS SOLD

Items	December 31, 2025	December 31, 2024
Raw materials	$ 215,208	$ 237,609
Work-in-process	26,570	33,513
Finished goods	74,309	133,682

(1) The cost of inventories recognized as expenses for the period :

Items	December 31, 2025	December 31, 2024
Goods	$ 128	$ 10
Total	$ 316,215	$ 404,814

The reversal in market value of the Group's inventories as for 2025 and 2024 is mainly due to decline in the amount of slow-moving inventory and increase in the copper price.

(2) The inventories are not pledged by the Group.

6.6 OTHER FINANCIAL ASSETS - CURRENT

Items	December 31, 2025	December 31, 2024
Pledged deposits
Demand deposits	$ 424	$ 439

(1) Please refer to Note 8 for information on the amounts of pledged and restricted bank deposits.
(2) Please refer to Note 12 for information on the Group's management and measurement policies of credit risk.

6.7 PROPERTY, PLANT AND EQUIPMENT

Items	December 31, 2025	December 31, 2024
Land	$ 495,249	$ 495,249
Buildings	693,870	693,870
Machinery	211,750	198,902
Other equipment	136,115	128,854
Total cost	1,536,984	1,516,875
Less: accumulated depreciation and impairment	(410,429)	(372,635)
Total	$ 1,126,555	$ 1,144,240

Please refer to Note 8 for information on the amounts of pledged property, plants, and equipment.

6.8 LEASE ARRANGEMENT

(1) Right-of-use assets

Items	December 31, 2025	December 31, 2024
Transportation equipment	$ 6,426	$ 6,426
Total cost	6,426	6,426
Less: Accumulated depreciation	(4,417)	(2,275)
Total	$ 2,009	$ 4,151

Items	2025	2024
Additions	$ -	$ 2,792
Depreciation expense
Transportation equipment	$ 2,142	$ 1,366

(2) Lease Liabilities

Items	December 31, 2025	December 31, 2024
Current	$ 1,253	$ 2,146
Non-current	$ 805	$ 2,058

Ranges of discount rates for lease liabilities are as follows:

Items	December 31, 2025	December 31, 2024
Transportation equipment	3.50%	3.50%

Please refer to Note 6.23 for information on the Group's interest on lease liabilities.

Please refer to Note 12 for the maturity analysis of lease liabilities.

(3) Material lease-in activities and terms

The Group leases official car with lease terms to 2027.

(4) Other lease information

Items	2025	2024
Expenses relating to short-term leases	$ -	$ -
Total cash outflow for leases	$ 2,259	$ 1,442

The Group elected to apply the recognition exemption for short-term leases and low-value asset leases and, thus, did not recognize right-of-use assets and lease liabilities for these leases.

6.9 INTANGIBLE ASSETS

Items	December 31, 2025	December 31, 2024
Patents	$ 1,702	$ 1,795
Computer software	3,407	4,243
Total	5,109	6,038
Less: Accumulated amortization	(2,633)	(2,704)
Intangible assets, net	$ 2,476	$ 3,334

Items	Patents	Computer software	Total
Cost
Balance, January 1,2025	$ 1,795	$ 4,243	$ 6,038
Additions	45	443	488
Disposals	(138)	(1,279)	(1,417)
Balance, December 31,2025	$ 1,702	$ 3,407	$ 5,109
Accumulated amortization
Balance, January 1,2025	$ (1,298)	$ (1,406)	$ (2,704)
Amortization expense	(92)	(1,254)	(1,346)
Disposals	138	1,279	1,417
Balance, December 31,2025	$ (1,252)	$ (1,381)	$ (2,633)
Items	Patents	Computer software	Total
Cost
Balance, January 1,2024	$ 2,466	$ 4,002	$ 6,468
Additions	127	3,221	3,348
Disposals	(798)	(2,980)	(3,778)
Balance, December 31,2024	$ 1,795	$ 4,243	$ 6,038
Accumulated amortization
Balance, January 1,2024	$ (1,989)	$ (3,529)	$ (5,518)
Amortization expense	(107)	(857)	(964)
Disposals	798	2,980	3,778
Balance, December 31,2024	$ (1,298)	$ (1,406)	$ (2,704)

6.10 OTHER NON-CURRENT ASSETS

Items	December 31, 2025	December 31, 2024
Prepaid equipment	$ 2,560	$ -
Refundable deposits	2,430	2,430
Others	2,663	1,707
Total	$ 7,653	$ 4,137

6.11 SHORT-TERM LOANS

~ 37 ~

The nature of loans	December 31, 2025	December 31, 2024
Unsecured loans	$ 80,000	$ 80,000
Total	$ 80,000	$ 80,000
Interest rate range	1.118%	1.117%

6.12 NOTES PAYABLE

Items	December 31, 2025	December 31, 2024
Notes payable-operating activities	$ 30,476	$ 30,113
Notes payable-nonoperating activities	-	2,466
Total	$ 30,476	$ 32,579

6.13 OTHER PAYABLES

Items	December 31, 2025	December 31, 2024
Salaries and bonuses payable	$ 21,161	$ 21,248
Payable for outsourced expense	2,913	3,617
Payable for supplies expense	3,114	3,783
Compensation payable of employees and directors	581	4,181
Payable for packing expense	2,463	2,612
Payable for equipment and construction	9,680	1,787
Others	10,450	10,449
Total	$ 50,362	$ 47,677

6.14 LONG-TERM LOANS AND ITS CURRENT PORTION

Items	December 31, 2025	December 31, 2024
Secured loans	$ 195,342	$ 224,173
Less: current portion	(28,921)	(28,831)
Total	$ 166,421	$ 195,342
Interest rate range	1.895%–1.925%	1.895%–1.925%
Year to maturity	2026 to 2033	2025 to 2033

(1) The loans are repaid in installments before the maturity date.
(2) Please refer to Note 8 for the information of pledging the Group’s property, plant and equipment for secured loans.

6.15 RETIREMENT BENEFIT PLANS

(1) Defined contribution plans

A. The plan under Labor Pension Act (the "Act") of the R.O.C. is deemed a defined contribution plan. Pursuant to the Act, the Company have made monthly contributions equal to 6% of each employee's monthly salary to employees' pension accounts.

B. The Group's recognized expenses in the consolidated statement of comprehensive income were $3,599 thousand and $3,508 thousand under the contributions rates specified in the plans for the years ended December 31,2025 and 2024, respectively.

(2) Defined benefit plans

A. The Company have defined benefit plans in accordance with Labor Standards Law of the R.O.C. Pension benefits are based on the number of units accrued and average monthly salaries and wages of the last 6 months prior to retirement. The Company make monthly contributions of 2% of each individual employee's salary to employees' pension accounts, which submit to the Labor Retirement Reserve Supervisory Committee to the retirement fund deposited in Bank of Taiwan under the name of the committee. Also, the Company would assess the balance in the aforementioned labor pension reserve account by the end of each year. If the amount of the balance in the pension fund is not enough to pay the pension to the labors expected to be qualified for retirement in the following year, the Company will make contribution for the deficit by next March. The Fund is managed by the Government's designated authorities and the Company have no right to influence their investment strategies.

B. Amounts recognized in the consolidated balance sheet are as follows:

Items	December 31, 2025	December 31, 2024
Present value of defined benefit obligations	$ 38,526	$ 38,102
Fair value of plan assets	(31,152)	(27,679)
Net defined benefit liability	$ 7,374	$ 10,423

C. Movements in net defined benefit liability are as follows:

Items	2025
	Present value of defined benefit obligations	Fair value of plan assets	Net defined benefit liability
Balance at January 1	$ 38,102	$ (27,679)	$ 10,423
Service costs
Interest expense (revenue)	609	(451)	158
Amounts recognized in profit and loss	609	(451)	158
Remeasurements:
Return on plan assets (Amounts included in	-	(1,904)	(1,904)

	2025
Items	Present value of defined benefit obligations	Fair value of plan assets	Net defined benefit liability
interest income or expense are excluded)
Actuarial (gains) losses -
Changes in financial assumptions	$483	$-	$483
Experience adjustments	(668)	-	(668)
Amounts recognized in other comprehensive income (losses)	(185)	(1,904)	(2,089)
Pension fund contributions	-	(1,118)	(1,118)
Balance at December 31	$38,526	$(31,152)	$7,374
	2024
Items	Present value of defined benefit obligations	Fair value of plan assets	Net defined benefit liability
Balance at January 1	$39,458	$(25,604)	$13,854
Service costs
Interest expense (revenue)	473	(314)	159
Amounts recognized in profit and loss	473	(314)	159
Remeasurements:
Return on plan assets (Amounts included in interest income or expense are excluded)	-	(2,228)	(2,228)
Actuarial (gains) losses -
Changes in financial assumptions	(739)	-	(739)
Experience adjustments	504	-	504
Amounts recognized in other comprehensive income (losses)	(235)	(2,228)	(2,463)
Pension fund contributions	-	(1,127)	(1,127)
Paid pension	(1,594)	1,594	-
Balance at December 31	$38,102	$(27,679)	$10,423

Information about Fair value of plan assets are as follows:

Items	December 31, 2025	December 31, 2024
Cash and cash equivalents	$ 31,152	$ 27,679

D. Because of the defined benefit plans under the Labor Standards Law, the Group is exposed to the following risks:

(a) Investment risk

The pension funds are invested in equity and debt securities, bank deposits, etc. at the discretion of the Bureau of Labor Funds of Ministry of Labor, or under the mandated management. However, under the Labor Standards Law, the rate of return on plan assets shall not be less than the average interest rate on a two-year time deposit published by the local banks.

(b) Interest risk

A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the debt investments of the plan assets.

The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation.

E. The actuarial valuations of the present value of the defined benefit obligation were carried out by qualified actuaries. The significant assumptions on measurement date were as follows:

Items	Measurement date
	December 31, 2025	December 31, 2024
Discount rate	1.30%	1.60%
Expected salary increase rate	2.50%	2.50%

Reasonably possible changes to the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown below.

Items	December 31, 2025	December 31, 2024
Discount rate

Items	December 31, 2025		December 31, 2024
0.1% increase	$	(163)	$	(180)
0.1% decrease		164		192
Expected salary increase rate
0.1% increase	$	138	$	156
0.1% decrease		(137)		(155)

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

F. The contribution that the Group expects to make to its defined benefit pension plans in next year is $1,020 thousand. The weighted average maturity period of the defined benefit obligation is 4.2 years.

6.16 COMMON STOCKS

(1) Movements in the number of the Company's common shares outstanding were as follows:

Items	2025		2024
	Shares (thousand shares)	Capital	Shares (thousand shares)	Capital
Balance, January 1	65,370	$ 653,700	65,370	$ 653,700
Balance, December 31	65,370	$ 653,700	65,370	$ 653,700

The par value of common stock is $10 per share, and every share has one voting right and the right to gain dividends.

(2) The Company's authorized capital was $700,000 thousand, consisting of 70,000 thousand shares as of December 31, 2025.

6.17 RETAINED EARNINGS

(1) According to the Company's Article of Incorporation, the current year's earnings, if any, shall first pay taxes, offset its losses, set aside a legal capital reserve at $10\%$ of the remaining earnings until the accumulated legal capital reserve equals the Company's paid-in capital then reversal or set aside a special capital reserve in accordance with relevant laws. Any balance left over shall be allocated with unappropriated earnings submitted by the Board of Directors to be approved at a shareholders' meeting.

The industrial development of the Company is in the growth stage. Considering the capital expenditures, actual operating needs, and the sound financial structure, the Company distributes the cash dividends and stock dividends in the principle of the

balanced proportion, provided that could be discretionary adjusted by the business or reinvestment demands and related factors, and the cash dividends should not be less than 50% of the total dividends.

(2) Legal reserve may be used to offset a deficit or to distribute as dividend in cash or in stock for the portion in excess of 25% of the Company's paid-in capital.

(3) Special reserve

In accordance with the regulation, the Company shall set aside special reserve from the debit balance on other equity item at the end of the year before distributing earnings. When debit balance on other equity is reversed subsequently, the reversed amount could be included in the distributable earnings.

(4) The appropriations of 2024 and 2023 earnings have been approved by shareholders' meetings held on June 17, 2025 and June 18, 2024, respectively. The appropriations of earnings and dividends per share were as follows:

Items	Appropriation of Earnings		Dividends Per Share (NT$)
	For Year 2024	For Year 2023	For Year 2024	For Year 2023
Legal reserve	$ 9,419	$ 6,385	$ -	$ -
Cash dividends	55,565	39,222	0.85	0.60
Total	$ 64,984	$ 45,607

(5) The Company's appropriation of earnings for 2025 had been approved in the meeting of the Board of Directors held on March 13, 2026. The appropriations of earnings were as follows:

Items	Appropriation of Earnings	Dividends Per Share (NT$)
Legal reserve	$ 1,528	$ -
Total	$ 1,528

The appropriations of earnings for 2025 are to be presented for approval in the shareholders' meeting to be held in June, 2026.

(6) Information on the resolution of the Board of Directors' and shareholders' meetings regarding the appropriation of earnings is available from the Market Observation Post System on the website of the TWSE.

6.18 OPERATING REVENUE

Items	2025	2024
Revenue from contracts with customers
Sales revenues	$ 1,294,691	$ 1,334,929
Other operating revenues	7,391	3,892
Total	$ 1,302,082	$ 1,338,821

(1) Description of customer contract

Revenue from contract with customers mainly derives from sales of woodworking machine from customers. The consideration, fixed and agreed on the contracts, is classified as short-term receivables, and is therefore measured at invoice price.

(2) Disaggregation of revenue from contracts with customers

Major products/Service line	2025	2024
Woodworking machine	$ 1,106,104	$ 1,156,414
Accessories and raw materials	184,712	172,125
Others	11,266	10,282
Total	$ 1,302,082	$ 1,338,821
Region	2025	2024
---	---	---
America	$ 1,181,856	$ 1,188,173
Others	120,226	150,648
Total	$ 1,302,082	$ 1,338,821

(3) Contract Balances

The Group recognized contract liabilities arising from contracts with customers are as follows:

Items	December 31, 2025	December 31, 2024	January 1, 2024
Contract liabilities-current	$ 11,186	$ -	$ -

6.19 PERSONNEL, DEPRECIATION, DEPLETION AND AMORTIZATION EXPENSES

By nature	2025			2024
	Cost of sales	Operating expense	Total	Cost of sales	Operating expense	Total
Personnel
Salary	$ 40,717	$ 36,222	$ 76,939	$ 40,685	$ 37,481	$ 78,166
Labor insurance	5,380	4,330	9,710	5,074	4,137	9,211
Pension	1,986	1,771	3,757	1,945	1,722	3,667
Others	1,918	1,471	3,389	1,838	2,186	4,024
Depreciation	34,382	12,560	47,392	37,034	12,747	49,781
Amortization	1,383	1,324	2,707	2,534	1,036	3,570
Total	$ 86,216	$ 57,678	$ 143,894	$ 89,110	$ 59,309	$ 148,419

(1) In accordance with the Company's Article of incorporation, the Company is stipulated to distribute compensation of employees at the rate not lower than 1% of profit before tax, and directors' remuneration at the rate not higher than 5% of profit before tax. Of the total amount of employee compensation mentioned above, no less than 50% shall

be allocated to grassroots employees. For the years ended of 2025 and 2024, employee compensation was accrued at 2.5% and 2.5% respectively, of profit before tax, while directors' remuneration was accrued at 0.8% and 1% respectively. If there is a change in the proposed amount after the annual financial statement are authorized for issue, the difference is recorded as a change in accounting estimate and adjusted in the next fiscal year.

(2) The appropriations of employees' compensation and directors' remuneration for 2025 and 2024 have been approved by the board of directors held on March 11, 2026, and March 13, 2025, respectively. The amount of approved and recognized in financial statement is shown as follows:

	For Year 2025		For Year 2024
	Employees' compensation	Directors' remuneration	Employees' compensation	Directors' remuneration
Amounts approved in meeting	$ 440	$ 141	$ 2,987	$ 1,194
Amounts recognized in respective financial statement	440	141	2,987	1,194
Difference	$ -	$ -	$ -	$ -

The employee compensation of 2025 and 2024 are paid in cash.

(3) Information regarding employees' compensation and directors' remuneration is available from the Market Observation Post System at the website of the TWSE.

6.20 INTEREST INCOME

Items	2025	2024
Interest income of bank deposits	$ 6,237	$ 11,555

6.21 OTHER INCOME

Items	2025	2024
Compensation income	$ -	$ 3,000
Overdue amounts reclassified as income	4,739	1,591
Others	3,718	3,684
Total	$ 8,457	$ 8,275

The compensation income arose from claims made by customers due to product defects caused by manufacturing process issues of the Group's component suppliers; accordingly, the Group sought indemnification from the component suppliers.

6.22 OTHER GAINS AND LOSSES

Items	2025	2024
Foreign exchange gain (losses), net	$ (24,287)	$ 44,615
Gain on disposal of property, plant and equipments	153	375
Total	$ (24,134)	$ 44,990

6.23 FINANCIAL COSTS

Items	2025	2024
Interest expense
Bank loans	$ 5,324	$ 6,432
Interest on lease liabilities	113	93
Less: capitalized amount for qualified assets	-	-
Total	$ 5,437	$ 6,525
Interest capitalization rates	-	-

6.24 INCOME TAX

(1) Components of income tax expense:

Items	2025	2024
Current income tax expense
Current tax (expense) benefit recognized in the current year	$ 1,953	$ 16,702
Adjustments on prior years	494	15
Current tax	2,447	16,717
Deferred income tax expense
The origination and reversal of temporary differences	974	6,353
Deferred tax	974	6,353
Income tax expense recognized in profit or loss	$ 3,421	$ 23,070

(2) Income tax (expenses) benefits recognized in other comprehensive income were as follows:

Items	2025	2024
Exchange differences on translation of foreign operations	$ (8)	$ 12
Remeasurement of defined benefit obligation	418	493
Total	$ 410	$ 505

(3) Reconciliation of income between accounting profit and income tax expense recognized in profit or lose :

Items	2025	2024
Income before tax	$ 17,026	$ 115,284
Income tax expense at the statutory rate	$ 3,405	$ 23,057
Tax effect of adjusting items:
Deductible items in determining taxable income	(1,452)	(6,355)
Income tax adjustments on prior years	494	15
Net changes on deferred income tax	974	6,353
Income tax expense recognized in profit or loss	$ 3,421	$ 23,070

Income tax rate of the Company is $20\%$ , and the tax rate for retained earnings is $5\%$ . For entities located in other jurisdictions, taxes are calculated using the applicable tax rate for each individual jurisdiction.

(4) Deferred tax assets or liabilities arising from temporary differences :

Items	2025
	January 1	Recognized in (losses) gains	Recognized in other comprehensive income	December 31
Deferred income tax assets
Temporary differences
Net defined benefit liability	$ 648	$ -	$ (418)	$ 230
Unrealized exchange loss	16	25	-	41
Unrealized loss on inventories	10,000	(255)	-	9,745
Others	2,308	(302)	-	2,006
Subtotal	12,972	(532)	(418)	12,022
Deferred tax liabilities
Temporary differences
Exchange differences arising on translation of foreign operations	(8,049)	-	8	(8,041)
Unrealized exchange gain	(923)	(250)	-	(1,173)
Others	(309)	(192)	-	(501)
Subtotal	(9,281)	(442)	8	(9,715)
Total	$ 3,691	$ (974)	$ (410)	$ 2,307

~ 47 ~

Items	2024
	January 1	Recognized in (losses) gains	Recognized in other comprehensive income	December 31
Deferred income tax assets
Temporary differences
Net defined benefit liability	$ 1,141	$ -	$ (493)	$ 648
Unrealized exchange loss	5,280	(5,264)	-	16
Unrealized loss on inventories	11,040	(1,040)	-	10,000
Others	1,198	1,110	-	2,308
Subtotal	18,659	(5,194)	(493)	12,972
Deferred tax liabilities
Temporary differences
Exchange differences arising on translation of foreign operations	(8,037)	-	(12)	(8,049)
Unrealized exchange gain	(73)	(850)	-	(923)
Others	-	(309)	-	(309)
Subtotal	(8,110)	(1,159)	(12)	(9,281)
Total	$ 10,549	$ (6,353)	$ (505)	$ 3,691

(5) The income tax returns of the Company through 2023 have examined by tax authority.

6.25 EARNINGS PER SHARE

Items	2025	2024
Basic earnings per share
Net income attributable to ordinary shareholders of the Company	$ 13,605	$ 92,214
Net income for calculating basic earnings per share	$ 13,605	$ 92,214
Weighted average shares outstanding (thousand shares)	65,370	65,370
Basic earnings per share (after tax) (in dollars)	$ 0.21	$ 1.41
Diluted earnings per share
Net income attributable to ordinary shareholders of the Company	$ 13,605	$ 92,214
Net income for calculating diluted earnings per share	$ 13,605	$ 92,214
Weighted average shares outstanding (thousand shares)	65,370	65,370

If the Company is able to settle the employee compensation by cash or stocks, the employee compensation should be assumed to be settled in stocks and the resulting potential shares increased should be included in the weighted average shares outstanding in calculation of diluted earnings per share, if the shares have a dilutive effect. Such dilutive effect of the potential shares needs to be included in the calculation of diluted earnings per share until employee compensation is approved in the following year.

6.26 Changes in liabilities from financing activities

Items	January 1, 2025	Fianancing cash flow Changes	Non-cash Changes	December 31, 2025
Short-term loans	$ 80,000	$ -	$ -	$ 80,000
Long-term loan(include current portion)	224,173	(28,831)	-	195,342
Lease liabilities	4,204	(2,146)	-	2,058
Deposits received	344	-	-	344
Total	$ 308,721	$ (30,977)	$ -	$ 277,744
Items	January 1, 2024	Fianancing cash flow Changes	Non-cash Changes	December 31, 2024
Short-term loans	$ 130,000	$ (50,000)	$ -	$ 80,000
Long-term loan(include current portion)	391,627	(167,454)	-	224,173
Lease liabilities	2,761	(1,349)	2,792	4,204
Deposits received	344	-	-	344
Total	$ 524,732	$ (218,803)	$ 2,792	$ 308,721

7. RELATED PARTY TRANSACTIONS

Intercompany balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated upon consolidation; therefore, those items are not disclosed in this note. The following is a summary of transactions between the Company and other related parties:

7.1 Related party name and categories

~ 49 ~

Related Party
Related Party Categories

CHIEN HSIN TRADING CO., LTD.
YEON CHUAN MACHINERY CO., LTD.
NAN YU INDUSTRY CO., LTD.
OLIVER MACHINERY CO. (OLIVER)
Other related parties
Other related parties
Other related parties
Other related parties
Other related parties

Other related parties mainly representing the entity is the juridical person director of the Company or the chairman of the entity, who is the same person as the chairman of the Company or has the second-degree relative with the chairman of the Company, or is judged to have beneficial relationships.

7.2 Significant transactions between related parties

(1) Revenue

Items	Related Party	2025	2024
Sales revenue	Other related parties	$ 78,942	$ 53,392

Selling prices between related parties were determined and negotiated referring to related market prices. Payment terms were ranging from T/T 30 to 120 days.

(2) Purchases

Items	Related Party	2025	2024
Purchases	Other related parties	$ 8,354	$ 9,873

Purchasing prices between related parties were determined and negotiated referring to related market prices. The payment terms were ranging from T/T 30 days.

(3) Receivables due from related parties

Items	Related Party	December 31, 2025	December 31, 2024
Notes receivable	Other related parties	$ -	$ 16
Accounts receivable	Other related parties -OLIVER	$ 22,872	$ 12,435

(4) Payables due to related parties

Items	Related Party	December 31, 2025	December 31, 2024
Accounts payable	Other related parties	$ 1,262	$ 1,291

(5) Other transactions

~ 50 ~

Items	Related Party	2025	2024
Operating expenses	Other related parties	$ 329	$ 338

7.3 Compensation of key management personnel

Items	2025	2024
Salaries and other short-term employee benefits	$ 14,690	$ 14,477
Post- employment benefits	267	246
Total	$ 14,957	$ 14,723

8. PLEDGED ASSETS

The Group's assets pledged as collateral are as follows :

Items	December 31, 2025	December 31, 2024
Property, plant, and equipment (Net)	$ 1,013,670	$ 1,038,034
Demand deposits (recognized as other financial assets - current)	424	439
Total	$ 1,014,094	$ 1,038,523

9. SIGNIFICANT CONTINGENCY LIABILITIES AND UNRECOGNIZED CONTRACT COMMITMENTS

9.1 Contingencies

The Group and A company signed the supplier contract. Pursuant to which, the Group agreed to produce and sell products to A company, which should be insured with a product liability insurance. The period of insurance agreement is from August 1,2025 to August 1, 2026. The insurance policy covers from August 1,2013 to August 1,2026. The maximum indemnification amount during the policy covering period is US$1,000 thousand.

10. SIGNIFICANT DISASTERS LOSSES : NONE.

11. SIGNIFICANT SUBSEQUENT EVENTS: NONE.

12. OTHERS

12.1 Capital risk management

The Group requires an adequate capital structure to enable the expansion and enhancement of its plant and equipment. Therefore, the Group manages its capital in a manner to ensure that it has sufficient and necessary financial resources and operating plan to fund its working capital needs, capital asset purchases, development expenditure, debt service requirements and other business requirements associated with its existing operations over the next 12 months.

~ 51 ~

12.2 Financial instruments

(1) Financial risks on financial instruments

Financial risk management policies

The Group's activities expose it to a variety of financial risks. These financial risks included market risk (including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk. The Group's overall risk management strategy focuses on the unpredictability of financial markets and seeks to mitigate potential adverse effects on its financial performance.

The Group's material financial activities are approved by the Board of Directors in accordance with relevant requirements and internal control mechanism, which requires the Group to comply with its financial operating policies and procedures that provide guiding principles for the overall financial risk management and accountability and separation of duties.

Significant financial risks and degrees of financial risks

A. Market risk

(a) Foreign exchange risk

The Group's sales and purchase activities denominated in foreign currencies are exposed to foreign currency risk. The Group's functional currency is New Taiwan dollars. The main foreign currencies of those thousand transactions are US dollars, RMB, Euro and so on. To protect against reductions in value and the volatility of future cash flows results from changes in foreign exchange rates, the Group might hedge its foreign exchange risk exposure by using derivatives, such as forward exchange agreements. The usage of derivative financial instruments can assist the Group to reduce but not completely eliminate the influence of changes in foreign exchange rates.

Sensitivity analysis of foreign currency risk

Items	December 31, 2025
	Foreign Currency	Exchange Rate	New Taiwan Dollars
Financial Assets
Monetary Items
USD	$ 11,131	31.430	$ 349,845
RMB	122	4.496	548
EUR	5	36.90	173
Financial Liabilities
Monetary Items
USD	37	31.430	1,156
RMB	907	4.496	4,079

Items	December 31, 2024
	Foreign Currency	Exchange Rate	New Taiwan Dollars
Financial Assets
Monetary Items
USD	$ 7,592	32.785	$ 248,891
RMB	122	4.478	545
EUR	655	34.14	22,350
Financial Liabilities
Monetary Items
USD	161	32.785	5,269
RMB	973	4.478	4,359

The Group is mainly exposed to US dollar, RMB and Euro. The sensitivity analysis rate for the Group is $1\%$ increase and decrease in NTD against the relevant foreign currencies $1\%$ is the sensitivity rate used when reporting foreign currency risk internally to key management personnel. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a $1\%$ change in foreign currency rates. An increase/ decrease in profit before tax would be resulted where the NTD strengthens/ weakens $1\%$ against the relevant currency with all other variables held constant in the amounts of $\$3,453$ thousand and $\$2,622$ thousand for the years ended December 31,2025 and 2024, respectively. The realized and unrealized foreign currency exchange gains(losses) for the years ended December 31, 2025 and 2024 are $\$24,287$ thousand and $\$44,615$ thousand, respectively, due from US dollars transactions.

(b) Price risk

The Group does not hold equity securities classified as at fair value through profit or loss. There are no other price risk items.

(c) Interest rate risk

The carrying amounts of interest - bearing financial instruments held by the Group as of the reporting date are as follows:

Items	Carrying Amounts
	December 31, 2025	December 31, 2024
Fair value interest rate risk
Financial assets	$ 47,145	$ 98,355
Financial liabilities	-	-
Net	$ 47,145	$ 98,355

Cash flow interest rate risk

Items	Carrying Amounts
	December 31, 2025	December 31, 2024
Financial assets	$ 438,156	$ 446,899
Financial liabilities	(275,342)	(304,173)
Net	$ 162,814	$ 142,726

Sensitivity analysis for instruments with fair value interest rate risk

The Group does not classify any fixed-rate instruments as financial assets measured at fair value through profit and loss. In addition, the Group does not designate derivatives as hedge instruments under the fair value hedge accounting model. Therefore, the change in interest rate on the reporting date has no effect on profit or loss and other comprehensive income.

Sensitivity analysis for instruments with cash flow interest rate risk

The effective interest rates for the Group's floating interest rate financial instruments are susceptible to the market interest rate. If the market interest rate increases/decreases $1\%$ , the profit before tax will increase/decrease $\$1,628$ thousand and $\$1,427$ thousand for the years ended December 31, 2025 and 2024, respectively.

B. Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial losses to the Group. The Group is exposed to credit risk from operation activities, primarily trade receivable, and from investing activities, primarily bank deposits and other financial instruments. Credit risk is managed separately for business related and financial related exposures.

(a)Business related credit risk

In order to maintain the credit quality of the trade receivables, the Group has established procedures to monitor and limit exposure to credit risk on trade receivables. Credit evaluation is performed taking into account relevant factors that may affect a customer's paying ability, such as the customer's financial condition and historical transaction records, internal and external credit rating and economic conditions.

(b)Financial credit risk

The Group's exposure to financial credit risk pertaining to bank deposits and other financial instruments was evaluated and monitored by the Group's treasury function. The Group only transacts with creditworthy counterparties and banks; therefore, no significant financial credit risk was identified.

i. Credit concentration risk

As of December 31, 2025 and 2024, the proportion of the accounts receivable of big five client, representing $98\%$ and $87\%$ , respectively. The credit

concentration risk associated with other accounts receivable is relatively insignificant.

ii. Measurement of expected credit losses

(i) Accounts receivable: The Group applies simplified approach to accounts receivable. Please refer to Note 6.3 for more information.

(ii) The criteria used to determine whether credit risk has increased significantly: The Group considered credit factors and reviewed relevant information associated with debtors to assess whether credit risks on financial instruments have increased significantly since initial recognition.

iii. Holding collateral and other credit enhancement to hedge against credit risk of financial assets: None.

iv. Credit risk of financial assets measured at amortized cost:

Please refer to Note 6.3 for information on the Group's credit exposures associated with accounts receivable. Other financial instruments amortized at cost, such as cash and cash equivalents, other receivables and other financial assets-current, have low credit losses. After assessment, the Group determined that no material impairment occurred.

C. Liquidity risk

(a) Liquidity risk management

The objective of the Group's management of liquidity risk is to maintain sufficient cash and cash equivalents, highly liquid securities, and banking facilities to ensure that the Group has sufficient financial flexibility for its operations.

(b) Maturity analysis for financial liabilities

The following table details the Group's remaining contractual maturity for its non-derivative financial liabilities:

December 31, 2025

Non-derivative Financial Liabilities	Within 1 year	1-5 years	Over 5 years	Contract cash flows	Carrying amounts
Short-term loans	$ 80,569	$ -	$ -	$ 80,569	$ 80,000
Notes payable	30,476	-	-	30,476	30,476
Accounts payable	162,515	-	-	162,515	162,515
Other payables	25,923	-	-	25,923	25,923
Lease liabilities	1,301	818	-	2,119	2,058
Long-term loan (include current portion)	32,422	117,797	58,500	208,719	195,342
Deposits received	-	344	-	344	344
Total	$ 333,206	$ 118,959	$ 58,500	$ 510,665	$ 496,658

December 31, 2024

Non-derivative Financial Liabilities	Within 1 year	1-5 years	Over 5 years	Contract cash flows	Carrying amounts
Short-term loans	$ 80,565	$ -	$ -	$ 80,565	$ 80,000
Notes payable	32,579	-	-	32,579	32,579
Accounts payable	198,844	-	-	198,844	198,844
Other payables	19,680	-	-	19,680	19,680
Lease liabilities	2,260	2,119	-	4,379	4,204
Long-term loan (include current portion)	32,886	124,772	83,947	241,605	224,173
Deposits received	-	344	-	344	344
Total	$ 366,814	$ 127,235	$ 83,947	$ 577,996	$ 559,824

The Group does not expect the timing of occurrence of the cash flows estimated through the maturity date analysis will be significantly earlier, nor expect the actual cash flow amount will be significantly different.

(2) Categories financial instruments

The carrying amount of each financial asset and financial liability of the Group as of December 31, 2025 and 2024 were as follows:

Item	December 31, 2025	December 31, 2024
Financial assets
Financial assets measured at amortized cost (Note 1)	$ 664,089	$ 668,058
Financial liability
Financial liabilities measured at amortized cost (Note 2)	494,600	555,620

Note 1: The balances included financial assets measured at amortized cost, which comprise cash and cash equivalents, notes receivable, accounts receivable, other receivable, other financial assets and refundable deposits.

Note 2: The balances included financial liabilities measured at amortized cost, which comprise short-term loan, notes payable, accounts payable, other payables, long-term loan (include current portion) and deposits received.

12.3 Fair value information of financial instruments

(1) Definition of fair value measurements are grouped into Level 1 to 3 as follows:

Level 1: Relevant inputs are quoted prices in active markets for identical assets or liabilities that the entity can access on the measurement date.

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

Level 3: Inputs are unobservable inputs that used to measure fair value to the extent when relevant observable inputs are not available.

(2) Financial instruments that are not measured at fair value.

The fair value of the Group's financial instruments not measured at fair value including cash and cash equivalents, notes receivable, accounts receivable, other receivable, other financial assets, refundable deposits, short-term loan, notes payables, accounts payables, other payables, long-term loan (including current portion) and other financial liabilities approximate their fair value.

(3) Financial instruments that are measured at fair value: none.

(4) The methods and assumptions the Group used to measure fair value are as follows:

A. The Group measures the fair values of its financial instruments with an active market using their quoted prices in the active market.

B. Fair value of other financial assets and financial liabilities (except for aforementioned) are determined in accordance with generally accepted pricing model based on the discounted cash flow analysis.

(5) Transfer between Level 1 and Level 2 of the fair value hierarchy: none.

(6) Changes in level 3 instruments: none.

12.4 Transfer of financial assets

Transferred financial assets that are derecognized in their entirety:

The Company entered into a factoring agreement with a financial institute. Under the agreement, the Company issued the consent, which clarified that the factoring transaction is without legal recourse. When the factoring is effective, those debtors' credit risk will transfer to the financial institute, and the Company should bear the loss from the commercial dispute, and the credit risk rate agreed to be borne after transferring. The Company does not have any continuing involvement in the transferred accounts receivable. Thus, the Company derecognized the transferred accounts receivable, and the related information is as below:

December 31, 2025

Transferee	Amount transferred during the period	Amount classified to other receivables	Amount available for cash advance	Amount advanced as of the end of the period	Interest rate (%) for amount advanced
DBS BANK	$ 83,126	$ 83,126	$ 70,657	$ -	-

December 31, 2024

Transferee	Amount transferred during the period	Amount classified to other receivables	Amount available for cash advance	Amount advanced as of the end of the period	Interest rate (%) for amount advanced
DBS BANK	$ 2,750	$ 2,750	$ 2,338	$ -	-

The limited amount of factoring abovementioned can be used repeatedly.

The Company provided the promissory note of US$10,200 thousand to the bank as security as of December 31,2025 and 2024.

~ 56 ~

\sim 57 \sim

13. SUPPLEMENTARY DISCLOSURES

13.1 Significant transactions information (before inter-company eliminations):

(1) Financings provided to others: None;
(2) Endorsement and guarantee provided to others: None;
(3) Material Securities Held at the End of the Period (excluding Investment in a subsidiary or an associate and interest in a joint venture): None;
(4) Total purchases from or sales to related parties of at least NT$100 million or 20% of the paid-in capital: Please see None;
(5) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital: None;
(6) The business relationship between the parent and the subsidiaries and significant transaction between them: None;

13.2 Information on investees (before inter-company eliminations): Please see Table 1 attached;
13.3 Information on investment in Mainland China (before inter-company eliminations):

(1) The name of the investee in Mainland China, the main businesses and products, its issued capital, method of investment, information on inflow or outflow of capital, percentage of ownership, income (losses) of the investee, ending balance, amount received as dividends from the investee, and the limitation on investee: None;
(2) Significant direct or indirect transactions with the investee, its prices and terms of payment, unrealized gain or loss, and other related information which is helpful to understand the impact of investment in Mainland China on financial reports: None.

14. SEGMENT INFORMATION

14.1 Operating segment, the revenue and operating results

The Company operates business only in a single industry, and the Company's management assess the performance and allocates the resource as a whole; therefore, the Company is identified as the only one reportable operating segment. The measurement basis on profit or loss of the Company's operating segment is the same as the preparation basis on this financial report. Please refer to the statement of comprehensive income for the revenue and operating results of the related operating segment.

14.2 Information on geographic area

(1) Non-current assets

Areas	December 31, 2025	December 31, 2024
Taiwan	$ 1,136,263	$ 1,153,432
Total	$ 1,136,263	$ 1,153,432

14.3 Major customer information

	2025		2024
Client name	Amount	%	Amount	%
Group A	$199,215	15	$211,360	16
Group B	206,862	16	257,552	19
Group C	420,319	32	383,428	29
Group D	218,292	17	256,383	19
Total	$1,044,688	80	$1,108,723	83

CHIU TING MACHINERY CO., LTD. AND SUBSIDIARIES

NAMES, LOCATIONS, AND RELATED INFORMATION OF INVESTEES OVER WHICH THE COMPANY EXERCISES SIGNIFICANT INFLUENCE

FOR THE YEAR ENDED DECEMBER 31, 2025

TABLE 1
Amounts in Thousands of New Taiwan Dollars

Investor Company	Investee Company	Location	Main Businesses and Products	Original Investment Amount		Balance as of December 31, 2024			Net Income (Losses) of the Investee	Share of Profits/Losses of Investee	Remarks
				December 31, 2024	December 31, 2023	Shares	Percentage of Ownership	Carrying Value
The Company	CHIU TING (BVI)	Note 1	Investing activities	$ 86,747	$ 86,747	-	100%	$ 893	$ 6	$ 6	Note 2

Note 1: 2/F, Palm Grove House, P.O. Box 3340, Road Town, Tortola, British Virgin Islands.
Note 2 : All the transactions had been eliminated when preparing consolidated financial statements.

AI assistant

GT — Audit Report / Information 2025

51861_rns_2026-05-11_5f0819d4-abda-4f51-815f-adc5ab173996.pdf

REPRESENTATION LETTER

INDEPENDENT AUDITORS' REPORT

Opinion

Basis for Opinion

Key Audit Matters

1. Credit risk for notes receivable and accounts receivable

Other Matter

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

Auditors' Responsibilities for the Audit of the Consolidated Financial Statements

Notice to Readers

1. ORGANIZATION AND OPERATIONS

2. THE AUTHORIZATION OF FINANCIAL STATEMENTS

3. APPLICATION OF NEW STANDARDS, AMENDMENTS, AND INTERPRETATIONS

3.2 The IFRSs issued by International Accounting Standards Board (IASB) and endorsed by FSC with effective date starting 2026

3.3 IFRSs issued by IASB but not yet endorsed and issued into effect by the FSC:

4. SUMMARY OF MATERIAL ACCOUNTING POLICIES

4.1 Statement of Compliance

4.2 Basis of Preparation

4.3 Basis of consolidation

4.4 Foreign Currencies

4.5 Classification of Current and Noncurrent Assets and Liabilities

4.6 Cash and cash equivalents

4.7 Financial Instruments

4.9 Property, Plant and Equipment

4.10 Leases

Right-of-use assets

Lease liabilities

(2) The Group as lessor

4.11 Intangible Assets

4.12 Impairment of non-financial assets

4.13 Provisions

4.14 Employee Benefits

4.17 Revenue Recognition

4.18 Borrowing Costs

6. CONTENTS OF SIGNIFICANT ACCOUNTS

6.1 CASH AND CASH EQUIVALENTS

6.2 NOTES RECEIVABLE, NET

6.3 ACCOUNTS RECEIVABLE, NET

6.4 OTHER RECEIVABLES

6.5 INVENTORIES AND COST OF GOODS SOLD

6.6 OTHER FINANCIAL ASSETS - CURRENT

6.7 PROPERTY, PLANT AND EQUIPMENT

6.8 LEASE ARRANGEMENT

6.10 OTHER NON-CURRENT ASSETS

6.11 SHORT-TERM LOANS

6.12 NOTES PAYABLE

6.13 OTHER PAYABLES

6.14 LONG-TERM LOANS AND ITS CURRENT PORTION

6.15 RETIREMENT BENEFIT PLANS

6.16 COMMON STOCKS

6.17 RETAINED EARNINGS

6.18 OPERATING REVENUE

6.20 INTEREST INCOME

6.21 OTHER INCOME

6.22 OTHER GAINS AND LOSSES

6.23 FINANCIAL COSTS

6.24 INCOME TAX

6.25 EARNINGS PER SHARE

6.26 Changes in liabilities from financing activities

7. RELATED PARTY TRANSACTIONS

7.1 Related party name and categories

7.2 Significant transactions between related parties

(1) Revenue

(2) Purchases

(3) Receivables due from related parties

(4) Payables due to related parties

(5) Other transactions

7.3 Compensation of key management personnel

8. PLEDGED ASSETS

9. SIGNIFICANT CONTINGENCY LIABILITIES AND UNRECOGNIZED CONTRACT COMMITMENTS

9.1 Contingencies

10. SIGNIFICANT DISASTERS LOSSES : NONE.

11. SIGNIFICANT SUBSEQUENT EVENTS: NONE.

12. OTHERS

12.1 Capital risk management

12.2 Financial instruments

(1) Financial risks on financial instruments

GT Audit Report / Information 2025