Stock Code: 2527

Hung Ching Development & Construction Co., Ltd. and Subsidiaries

Consolidated Financial Statements and Independent Auditors' Report

For the Years Ended December 31, 2025 and 2024

Address: 10F, No. 420, Sec. 1, Keelung Rd., Taipei City, Taiwan

Tel: (02)2691-5899

The independent auditors' report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors' report and consolidated financial statements, the Chinese version shall prevail.

§TABLE OF CONTENTS§

ITEM		PAGE	NUMBER OF FINANCIAL STATEMENT NOTES
1.	Cover	1	-
2.	Table of Contents	2	-
3.	Declaration of Consolidated Financial Statements of Affiliates	3	-
4.	Independent Auditors’ Report	4-7	-
5.	Consolidated Balance Sheets	8	-
6.	Consolidated Statements of Comprehensive Income	9-10	-
7.	Consolidated Statements of Changes in Equity	11	-
8.	Consolidated Statements of Cash Flows	12-13	-
9.	Notes to Consolidated Financial Statements
	a. Company History	14	1
	b. Date and Procedures of Authorization of Financial Statements	14	2
	c. Application of New and Amended Standards and Interpretations	14-16	3
	d. Summary of Significant Accounting Policies	16-30	4
	e. Primary Sources of Uncertainties in Major Accounting Judgments, Estimates, and Assumptions	30-31	5
	f. Details of Significant Accounts	31-60	6-26
	g. Transactions with Related Parties	60-65	27
	h. Pledged Assets	65-66	28
	i. Significant Contingent Liabilities and Unrecognized Contract Commitments	-	-
	j. Significant Disaster Loss	-	-
	k. Significant Events after the Balance Sheet Date	66	29
	l. Others	-	-
	m. Supplementary Disclosures
	1) Information on Significant Transactions	66, 70-75	30
	2) Information on Invested Companies	60, 76	30
	3) Information on Investments in Mainland China	66-67, 77	30
	n. Segment Information	67-69	31

March 6, 2026

Declaration of Consolidated Financial Statements of Affiliates

The entities of the Company that are required to be included in the consolidated financial statements of affiliates as of and for the year ended December 31, 2025 (from January 1 to 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 of parent company and its subsidiary prepared in conformity with the International Financial Reporting Standard 10. In addition, the information required to be disclosed in the consolidated financial statements of affiliates is included in the consolidated financial statements of parent company and its subsidiary. Consequently, we do not prepare a separate set of consolidated financial statements of affiliates.

Hereby certify

Company name: Hung Ching Development & Construction

Person in Charge: Wen-Hsiang Chien

Independent Auditors' Report

To the Board of Directors and the Shareholders of Hung Ching Development & Construction Co., Ltd.

Opinion

We have audited the accompanying consolidated financial statements of the Hung Ching Development & Construction Co., Ltd. and its subsidiaries (the "Group"), which comprise the consolidated balance sheets as of December 31, 2025 and 2024, and the consolidated statements of comprehensive income, changes in equity, and cash flows for the years then ended, and the notes to 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 the 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 of the Republic of China.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Parent Company Only 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.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Group's 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:

Sales revenue of building and land

For the year 2025, the real estate sales revenue of Hung Ching Group amounted to NT$314,786 thousand, accounting for 48% of total operating revenue. This is material to the consolidated financial statements and represents one of the Group's primary sources of revenue. Accordingly, we have identified whether the recognition of real estate sales revenue meets the criteria for revenue recognition as a key audit matter. Please refer to Notes 4 and 21 to the consolidated financial statements.

The main audit procedures performed on the specific levels in respect of the above-mentioned key audit matter for the audit of the year are as follows:

We understood and tested the design and operating effectiveness of the internal controls related to the sales cycle.
Obtaining the details of building and land for sales for the whole year: (1) sampling and verifying the contracts signed by the buyers and sellers to confirm the contract price; (2) sampling and verifying the registration date of the transfer of property ownership to verify that the property ownership has been transferred to the purchaser.

Other Matters

We have also audited the parent company only financial statements of Hung Ching Construction Development 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

The 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 the IFRS, IAS, IFRIC, and SIC endorsed and issued into effect by the 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 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 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 auditing standards generally accepted in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error. They are considered to be material if they individually or collectively could reasonably be expected to affect the economic decisions of users of these financial statements.

As part of an audit in accordance with the auditing standards generally accepted in 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 consolidated 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
6 -

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.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Company audit. We remain solely responsible for our opinion to the Group.

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 about 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.

Deloitte & Touche

Certified Public Accountant Wang-Sheng Lin

Certified Public Accountant Jun-Hong Shi

Financial Supervisory Commission Approval Document No.:
Jin-Guan-Zheng-Shen-Zi No. 1060023872

Financial Supervisory Commission Approval Document No.:
Jin-Guan-Zheng-Shen-Zi No. 1110348898

March 6, 2026

Hung Ching Development & Construction Co., Ltd. and Subsidiaries

Consolidated Balance Sheets

December 31, 2025 and 2024

Unit: NT$ thousand

Code	Assets	December 31, 2025		December 31, 2024
		Amount	%	Amount	%
Current assets
1100	Cash and cash equivalents (Note 6)	$ 1,372,459	4	$ 1,331,404	5
1150	Note receivable (Notes 7 and 21)	428	-	809	-
1172	Accounts receivable (Note 7 and 21)	5,646	-	6,139	-
1180	Accounts receivables from related party (Notes 7, 21, and 27)	5,147	-	6,458	-
1200	Other receivables (Notes 7)	961	-	6,894	-
1210	Other receivables from related parties (Notes 7 and 27)	800,043	3	1,654,943	6
130X	Inventories (Notes 5, 8 and 28)	11,274,258	34	9,586,273	35
1429	Prepayments (Note 16)	2,444,283	7	2,372,635	9
1476	Other financial assets - current (Note 15)	4,000	-	4,000	-
1479	Other current assets (Note 16)	1,230	-	1,426	-
11XX	Total current assets	15,908,455	48	14,970,981	55
Non-current assets
1517	Financial assets at FVTOCI - non-current (Notes 9, 26, and 28)	11,158,136	34	7,202,796	26
1535	Financial asset measured at amortized cost - non-current (Note 26)	10,000	-	10,000	-
1550	Investments accounted for using equity method (Note 11)	1,426,093	4	684,993	3
1600	Property, plant and equipment (Notes 12, 22 and 28)	1,004,418	3	1,018,607	4
1760	Investment properties (Notes 14, 22 and 28)	3,439,799	11	3,400,992	12
1780	Intangible assets (Note 22)	205	-	311	-
1840	Deferred tax assets (Note 23)	17,459	-	27,160	-
1990	Other non-current assets (Note 22)	11,083	-	13,632	-
15XX	Total non-current assets	17,067,193	52	12,358,491	45
1XXX	Total assets	$ 32,975,648	100	$ 27,329,472	100
Code
Liabilities and equity
Current liabilities
2100	Short-term borrowings (Notes 17, 26 and 28)	$ 3,208,000	10	$ 5,697,000	21
2110	Short-term bills payable (Notes 16, 26 and 28)	5,266,471	16	4,491,085	16
2130	Contract liabilities (Note 21)	794,933	2	29,030	-
2170	Trade payables (Note 18)	801,228	3	747,099	3
2219	Other payables	203,920	1	202,020	1
2220	Other payables - related parties (Note 27)	69	-	69	-
2230	Current tax liabilities	51,796	-	142,889	1
2322	Long-term borrowings - current portion (Notes 17 and 28)	1,684,864	5	360,609	1
2399	Other current liabilities	17,907	-	27,689	-
21XX	Total current liabilities	12,029,188	37	11,697,490	43
Non-current liabilities
2540	Long-term borrowings (Notes 17, 26 and 28)	3,400,645	10	1,741,806	6
2645	Guarantee deposits received (Note 14)	30,332	-	30,182	-
25XX	Total non-current liabilities	3,430,977	10	1,771,988	6
2XXX	Total liabilities	15,460,165	47	13,469,478	49
EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY (Note 20)
3110	Share capital	2,703,060	8	2,703,060	10
3200	Capital Surplus	388,635	1	371,540	1
Retained earnings
3310	Legal reserve	1,192,447	4	1,065,213	4
3320	Special reserve	187,713	-	274,472	1
3350	Unappropriated earnings	2,909,278	9	3,245,678	12
3300	Total retained earnings	4,289,438	13	4,585,363	17
3400	Other equity	10,225,281	31	6,271,008	23
3500	Treasury Shares	( 455,812 )	( 1 )	( 455,812 )	( 2 )
31XX	Total equity attributable to owners of the Company	17,150,602	52	13,475,159	49
36XX	NON-CONTROLLING INTERESTS	364,881	1	384,835	2
3XXX	Total equity	17,515,483	53	13,859,994	51
Total equity and liabilities		$ 32,975,648	100	$ 27,329,472	100

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

Chairman: Wen-Hsiang Chien

Manager: Chia-Pei Chou

Accounting Supervisor: Fang-Yin Chen

Hung Ching Development & Construction Co., Ltd. and Subsidiaries
Consolidated Statements of Comprehensive Income
January 1 to December 31, 2025 and 2024
Unit: NT$ thousands, except earnings per share of NT$

Code		2025		2024
		Amount	%	Amount	%
OPERATING REVENUE (Notes 21 and 27)
4100	Sales revenue of building and land	$ 314,786	48	$ 6,922,512	95
4300	Rental revenue	193,438	29	180,722	3
4500	Construction revenue	8,438	1	-	-
4600	Service revenue	58,155	9	88,713	1
4800	Other operating revenue	84,064	13	73,322	1
4000	Total operating revenue	658,881	100	7,265,269	100
OPERATING COSTS (Notes 8 and 22)
5110	Cost of building and land for sale	78,443	12	5,212,022	72
5300	Rental costs	138,138	21	125,044	1
5500	Construction costs	7,763	1	-	-
5600	Service costs	27,562	4	53,722	1
5800	Other operating costs	88,210	13	78,032	1
5000	Total operating costs	340,116	51	5,468,820	75
5900	Gross operating profit	318,765	49	1,796,449	25
OPERATING EXPENSES (Note 22)
6100	Selling and marketing expenses	24,306	4	102,544	1
6200	General and administrative expenses	276,774	42	331,784	5
6000	Total operating expenses	301,080	46	434,328	6
6900	Net operating income	17,685	3	1,362,121	19
NON-OPERATING INCOME AND EXPENSES
7100	Interest income (Note 22)	49,083	8	49,878	1
7010	Other income (Note 22)	323,976	49	243,537	3
7020	Other gains and losses (note 22)	45,998	7	33	-
7050	Finance costs (Note 22)	(306,735)	(47)	(310,849)	(4)
7060	Share of loss (profit) of associates recognized under equity method (Note 11)	169,900	26	113,998	1
7000	Total non-operating income and expenses	282,222	43	96,597	1

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Code		2025		2024
		Amount	%	Amount	%
7900	Income before tax	$ 299,907	46	$ 1,458,718	20
7950	Income tax expense (Note 23)	76,896	12	206,916	3
8200	NET PROFIT FOR THE YEAR	223,011	34	1,251,802	17
8310	Other comprehensive income/(loss)
8310	Items that will not be reclassified subsequently to profit or loss
8316	Unrealized gain/(loss) on investments in equity instruments at fair value through other comprehensive income	3,955,340	600	1,172,275	16
8360	Items that may be reclassified subsequently to profit or loss
8361	Exchange differences on translating the financial statements of foreign operations	818	-	4,909	-
8399	Income tax related to items that will be reclassified (Note 23)	( 163 )	-	( 982 )	-
8300	Other comprehensive income/(loss) for the year, net of income tax	3,955,995	600	1,176,202	16
8500	Total comprehensive income/(loss) for the year	$ 4,179,006	634	$ 2,428,004	33
8610	NET PROFIT/(LOSS) ATTRIBUTABLE TO
8610	Owners of the Company	$ 244,687	37	$ 1,272,344	17
8620	NON-CONTROLLING INTERESTS	( 21,676 )	( 3 )	( 20,542 )	-
8600		$ 223,011	34	$ 1,251,802	17
8710	TOTAL COMPREHENSIVE INCOME/(LOSS) ATTRIBUTABLE TO:
8710	Owners of the Company	$ 4,198,960	637	$ 2,449,212	34
8720	NON-CONTROLLING INTERESTS	( 19,954 )	( 3 )	( 21,208 )	( 1 )
8700		$ 4,179,006	634	$ 2,428,004	33
9710	EARNINGS PER SHARE (Note 24)
9710	Basic	$ 0.93		$ 4.86
9810	Diluted	$ 0.93		$ 4.84

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

Chairman: Wen-Hsiang Chien

Manager: Chia-Pei Chou

Accounting Supervisor: Fang-Yin Chen

Hung Ching Development & Construction Co., Ltd. and Subsidiaries

Consolidated Statements of Changes in Equity

January 1 to December 31, 2025 and 2024

Unit: NT$ thousand

Code	Balance as of January 1, 2024	Share capital	Capital Surplus	Retained earnings	Other equity items	Treasury Shares	Total	NON-CONTROLLING INTERESTS	Total equity
Number of Shares (In Thousand Shares)	Amount	Legal reserve	Special reserve	Unappropriated earnings	Exchange differences on translating the financial statements of foreign operations	Unrealized gain (loss) on financial assets at fair value through other comprehensive income
A1	Appropriation and distribution of retained earnings 2023	270,306	$ 2,703,060	$ 358,719	$ 1,020,589	$ 334,733	$ 2,363,156	($ 6,505)	$ 5,100,645
B1	Legal reserve	-	-	-	44,624	-	( 44,624)	-	-
B17	Reversal of special capital reserve	-	-	-	-	( 60,261)	60,261	-	-
B5	Cash dividend to shareholders	-	-	-	-	-	( 405,459)	-	-
D1	Net profit for 2024	-	-	-	-	-	1,272,344	-	-
D3	Other comprehensive income (loss) (after tax) for 2024	-	-	-	-	-	-	3,927	1,172,941
D5	Total comprehensive income/(loss) for 2024	-	-	-	-	-	1,272,344	3,927	1,172,941
M1	Adjustment in capital surplus from dividends paid to subsidiaries	-	-	12,821	-	-	-	-	-
Z1	Balance as of December 31, 2024	270,306	2,703,060	371,540	1,065,213	274,472	3,245,678	( 2,578)	6,273,586
B1	Appropriation and distribution of retained earnings 2024	-	-	-	127,234	-	( 127,234)	-	-
B17	Legal reserve	-	-	-	-	( 86,759)	86,759	-	-
B5	Cash dividend to shareholders	-	-	-	-	-	( 540,612)	-	-
D1	Net profit for 2025	-	-	-	-	-	244,687	-	-
D3	Other comprehensive income (loss) (after tax) for 2025	-	-	-	-	-	-	655	3,953,618
D5	Total comprehensive income/(loss) for 2025	-	-	-	-	-	244,687	655	3,953,618
M1	Adjustment in capital surplus from dividends paid to subsidiaries	-	-	17,095	-	-	-	-	-
Z1	Balance as of December 31, 2025	270,306	$ 2,703,060	$ 388,635	$ 1,192,447	$ 187,713	$ 2,909,278	($ 1,923)	$10,227,204

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

Chairman: Wen-Hsiang Chien

Manager: Chia-Pei Chou

Accounting Supervisor: Fang-Yin Chen

Hung Ching Development & Construction Co., Ltd. and Subsidiaries
Consolidated Statements of Cash Flows
January 1 to December 31, 2025 and 2024
Unit: NT$ thousand

Code		2025	2024
Cash flows from operating activities
A00010	Income before tax for the year	$ 299,907	$ 1,458,718
A20010	Adjustments to reconcile profit (loss)
A20100	Depreciation expenses	139,891	131,221
A20200	Amortization of long-term prepayments	2,762	3,103
A20400	Net gain (loss) on financial assets at FVTPL	-	( 112 )
A22500	Gain on disposal of property, plant and equipment	( 740 )	-
A20900	Finance costs	306,735	310,849
A21200	Interest income	( 49,083 )	( 49,878 )
A21300	Dividend income	( 233,722 )	( 230,089 )
A22300	Share of profit or loss of associates accounted for using the equity method	( 169,900 )	( 113,998 )
A23700	Reversal gain on impairment of investment property	( 45,910 )	-
A23800	Inventory impairment loss (reversal gain)	( 55,266 )	135,170
A29900	Profit from lease modification	-	( 92 )
A30000	Changes in operating assets and liabilities, net
A31115	Financial asset at FVTPL	-	3,092
A31130	Notes receivable	381	2,870
A31150	Trade receivables	493	5,310
A31160	Trade receivables from related parties	1,311	3,776
A31180	Other receivables	5,645	( 7,623 )
A31190	Other receivables - related party	283,700	( 32,944 )
A31200	Inventories	( 1,701,091 )	2,737,276
A31230	Prepayments	( 71,648 )	( 308,311 )
A31240	Other current assets	196	( 1,404 )
A32125	Contract liabilities	765,903	( 12,634 )
A32150	Trade Payables	54,129	( 19,249 )
A32180	Other payables	1,790	9,597
A32190	Other payables - related parties	-	9
A32230	Other current liabilities	( 9,782 )	( 2,708 )
A33000	Cash (outflow) inflow generated from operating activities	( 474,299 )	4,021,949
A33300	Interest paid	( 344,717 )	( 394,062 )
A33500	Income tax paid	( 158,451 )	( 78,021 )
AAAA	Net cash (outflow) inflow from operating activities	( 977,467 )	3,549,866

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Code		2025	2024
	Cash flows from investing activities
B00040	Acquisition of financial assets measured at amortized cost	$ -	($ 10,000)
B02700	Acquisition of property, plant and equipment	( 6,367)	( 124)
B02800	Proceeds from disposal of property, plant and equipment	743	-
B03800	Decrease in refundable deposits	( 107)	52,335
B05400	Acquisition of investment properties	( 5,767)	( 5,593)
B05500	Disposal of investment properties	-	4,235
B06500	Increase in other financial assets	-	( 4,000)
B07500	Interest received	49,371	52,325
B07600	Dividends received	233,722	230,089
BBBB	Net cash generated from investing activities	271,595	319,267
	Cash flows from financing activities
C00100	Decrease in short-term borrowings	( 2,489,000)	( 449,000)
C00500	Increase (Decrease) in short-term bills payable	775,386	( 1,361,731)
C01600	Long-term loans	3,343,703	1,020,000
C01700	Repayments of long-term borrowings	( 360,609)	( 1,956,666)
C03000	Increase in guarantee deposits received	2,666	4,416
C03100	Return of deposited guarantee money	( 2,516)	( 4,030)
C03700	Increase in other payables - related parties	-	1,500,000
C03800	Decrease in other payables - related parties	-	( 1,500,000)
C04020	Repayment for principal of lease liabilities	-	( 1,400)
C04500	Distribution of cash dividend	( 523,517)	( 392,637)
CCCC	Net cash inflow (outflow) from financing activities	746,113	( 3,141,048)
DDDD	Effect of exchange rate changes on cash	814	4,680
EEEE	Net increase in cash and cash equivalents for the year	41,055	732,765
E00100	Cash and cash equivalents, beginning of year	1,331,404	598,639
E00200	Cash and cash equivalents, end of year	$ 1,372,459	$ 1,331,404

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

Chairman: Wen-Hsiang Chien

Manager: Chia-Pei Chou

Accounting Supervisor: Fang-Yin Chen

Hung Ching Development & Construction Co., Ltd. and Subsidiaries
Notes to Consolidated Financial Statements
January 1 to December 31, 2025 and 2024
(Amounts in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

Company History
The Company, incorporated in 1986 with shares listed on the Taiwan Stock Exchange, mainly engaged in appointment of contractors to build public housing developments and commercial buildings for leasing and selling and in and management and investment of other relevant business.
The consolidated financial statements are presented in the Company's functional currency, the New Taiwan dollar.
Date and Procedures of Authorization of Financial Statements
The consolidated financial statements were approved by the Board of Directors and authorized for issue on March 6, 2026.
Application of New and Amended Standards and Interpretations
a. Initial application of the amendments to the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, "IFRSs") endorsed and issued into effect by the Financial Supervisory Commission (FSC).
The application of the amendments to the IFRSs endorsed and issued into effect by the FSC will not have a significant effect on the Company's accounting policies.
b. The IFRSs endorsed by the FSC for application in 2026

New, Revised or Amended Standards and Interpretations	Effective Date Issued 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
"Annual Improvements — Volume 11"	January 1, 2026
IFRS 17 "Insurance Contracts" (including the 2020 and 2021 amendments)	January 1, 2023

The consolidated company assessed that the amendments to the above standards or interpretations would not have a significant impact on the financial position and financial performance.

c. IFRSs issued by the IASB but not yet endorsed and issued into effect by the FSC

New, Revised or Amended Standards and Interpretations	Effective Date Issued by IASB (Note 1)
Amendments to IFRS 10 and IAS 28 "Sale or Contribution of Assets between an Investor and its Associate or Joint Venture"	To be determined
IFRS 18 "Presentation and Disclosure in Financial Statements"	January 1, 2027 (Note 2)
IFRS 19 "Subsidiaries without Public Accountability: Disclosures" (including the 2025 amendments)	January 1, 2027
Amendments to IAS 21 “Translation into a Hyperinflationary Presentation Currency”	January 1, 2027

Note 1: Unless stated otherwise, the aforementioned New, Revised or Amended Standards and Interpretations are effective for annual periods beginning on or after their respective effective dates.

Note 2: The Financial Supervisory Commission announced on September 25, 2025 that enterprises in Taiwan shall apply IFRS 18 effective January 1, 2028. Early adoption is permitted upon endorsement of IFRS 18 by the Financial Supervisory Commission.

IFRS 18 "Presentation and Disclosure in Financial Statements" and related consequential amendments

IFRS 18 will supersede IAS 1 "Presentation of Financial Statements." The key changes introduced by this standard include:

The Group shall assess whether it engages in investing in specified types of assets and providing financing to customers as distinct main business activities, and accordingly classify items of income and expenses in the statement of profit or loss into operating, investing, financing, income tax, and discontinued operations categories.
The statement of profit or loss must present operating profit or loss, profit or loss before financing and income tax, as well as clearly labeled subtotals and totals of profit or loss.
Enhanced aggregation and disaggregation guidance: Consolidated entities must identify assets, liabilities, equity, income, expenses, and cash flows resulting from individual transactions or other events and classify and aggregate them based on shared characteristics. Each line item in the primary financial statements should exhibit at least one similar characteristic. Items with dissimilar characteristics
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should be disaggregated in both the primary financial statements and the notes. Consolidated entities can label items as "other" only when no more informative label is available.

Disclosure of management-defined performance measures: when the Group communicates publicly outside the financial statements and conveys management’s view of an aspect of the consolidated entity’s overall financial performance to users of the financial statements, it shall disclose, in a single note to the financial statements, information related to management-defined performance measures. Such disclosures shall include a description of the measure, how it is calculated, a reconciliation to subtotals or totals specified by IFRS Accounting Standards, and the income tax and non-controlling interest effects of the related reconciling items.

In addition, the following consequential amendments have been made to IAS 7 "Statement of Cash Flows":

When the Group prepares cash flows from operating activities using the indirect method, operating profit shall be used as the starting point for reconciliation.
Interest and dividends received by the Group shall be classified as investing activities, while interest and dividends paid shall be classified as financing activities. Where the Group determines that it has specified main business activities, it shall consider the classification of dividend income, interest income, and interest expense presented in the statement of profit or loss in determining the classification of cash flows from dividends received, interest received, and interest paid in the statement of cash flows. However, each of the aforementioned cash flows shall be classified in only one category within the statement of cash flows.

Apart from the aforementioned impacts, as of the date the accompanying consolidated financial statements were authorized for issue, the consolidated company continues in evaluating the impact on its financial position and financial performance as a result of the aforementioned standards or interpretations. The related impact will be disclosed when the evaluation has been completed.

4. Summary of Significant Accounting Policies

a. 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 IFRSs endorsed and issued into effect by the FSC.

b. Basis of preparation

The accompanying consolidated financial statements have been prepared on the historical cost basis except for financial instruments which are measured at fair value.

The fair value measurements, which are grouped into Levels 1 to 3 based on the degree to which the related inputs are observable and based on the significance of the related inputs, are described as follows:

1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities on the measurement date;
2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for an asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
3) Level 3 inputs are unobservable inputs for the asset or liability.

c. Standards for Classification of Current and Noncurrent Assets and Liabilities

Current assets include:

1) Assets held for trading purposes;
2) Assets expected to be realized within 12 months after the balance sheet date; and
3) Cash and cash equivalents, excluding those that are restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period.

Current liabilities include:

1) Obligations incurred for trading purposes;
2) Obligations expected to be settled within 12 months from the balance sheet date (liabilities with long-term refinancing or rearrangement of payment terms completed after the balance sheet date and before the publication of the financial statements are also deemed as current liabilities); and
3) Liabilities for which the Company does not have a substantive right to defer settlement beyond 12 months after the balance sheet date.

Assets and liabilities that are not classified as current are classified as non-current.

The consolidated company is engaged in the construction business, which has an operating cycle of over one year. The normal operating cycle applies when considering the classification of current or non-current for the construction-related assets and liabilities.

d. Basis of Consolidation

The consolidated financial statements include the financial statements of the Company and the entities (subsidiaries) controlled by the Company. The financial statements of

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the subsidiaries have been adjusted to align their accounting policies with those of the consolidated company. In preparing the consolidated financial statements, all intercompany transactions, account balances, revenues, and expenses have been fully eliminated. The total comprehensive income of the subsidiaries is attributed to the owners of the Company and the non-controlling interests, even if this results in a deficit balance for the non-controlling interests.

Refer to Note X and Table VII and VIII for detailed information on subsidiaries, including percentages of ownership and main businesses.

e. Business Combinations

Business combinations are accounted for using the acquisition method. Acquisition-related costs are recognized as expenses in the period in which the costs are incurred and the services are received.

Non-controlling interests, which represent current ownership equity in the acquiree and the right to proportionately share in the net assets of the acquiree upon liquidation, are measured at their proportionate share of the recognized amounts of the acquiree's identifiable net assets. Other non-controlling interests are measured at fair value.

For step acquisitions, the previously held equity interest in the acquiree is remeasured at fair value on the acquisition date. Any resulting gain or loss is recognized in other comprehensive income. Amounts previously recognized in other comprehensive income related to the previously held interest in the acquiree before the acquisition date are accounted for on the same basis as if the acquirer had directly disposed of the previously held interest.

f. Foreign Currency

In preparing the financial statements of each individual entity, transactions in currencies other than the entity's functional currency (i.e., foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions.

Monetary items denominated in foreign currencies are translated at the rates prevailing on each date of balance sheets. Exchange differences on monetary items arising from settlement or translation are recognized in profit or loss in the period in which they arise. Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rate at the date of the transaction (i.e., not retranslated).

When preparing consolidated financial statements, the assets and liabilities of the foreign operating entities of the consolidated company (including subsidiaries whose operating countries or currencies differ from those of the Company) are translated into

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New Taiwan Dollars using the exchange rate prevailing on each balance sheet date. Revenue and expense items are translated using the average exchange rate for the period. Any resulting exchange differences are recognized in other comprehensive income and attributed separately to the owners of the Company and the non-controlling interests.

g. Inventories

Inventory includes real estate under development, undeveloped real estate, property held for sale, and merchandise inventory. Inventory is measured at the lower of cost and net realizable value. When comparing cost and net realizable value, individual items are measured separately except for items in the same inventory category. Net realizable value refers to the estimated selling price under normal circumstances, less the estimated costs required to complete and sell the goods. For real estate inventory, the actual construction costs are allocated based on the building area ratio and are reclassified into operating costs for the period, in accordance with the principle of recognizing real estate sales revenue. For other types of inventory, the cost is calculated using the weighted average method.

h. Investments in associates

Associates are entities over which the consolidated company has major influence but they are neither a subsidiary nor joint ventures.

The consolidated company uses equity method for investment in associates.

Under the equity method, the investment is initially treated at cost and adjusted thereafter for the post-acquisition change in the consolidated company's interest in profit and loss, shares in other total income and profit distribution by the associates. In addition, changes in the interests in associates are recognized based on the shareholding percentage.

Any excess of acquisition cost over the consolidated company's share of an associate's or a joint venture's identifiable assets and liabilities measured at the fair value on the date of acquisition is recognized as goodwill. The goodwill shall be included in the carrying amount of the investment but not allowed for amortization. If the consolidated company's share of the net fair value of the identifiable assets and liabilities exceeds acquisition cost, the excessive amount is recognized immediately in profit or loss.

When the consolidated company's share of loss derived from the investment of an affiliate equals or exceeds the consolidated company's interest (including the carrying amount of the investment and other long-term substantial interests in the associate's net asset in proportion to ownership percentage), the consolidated company shall cease recognizing losses further. The consolidated company shall only recognize additional

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losses and liabilities within the scope of occurred legal obligations, constructive obligations, or payments made on behalf of the associates.

To assess impairment, the consolidated company has to consider the overall carrying amount (including goodwill) of the investment as a single asset to compare the recoverable and carrying amounts. The cost of impairment identified is to be deemed as part of the carrying amount of the investment. Any reversal of the impairment loss is recognized only to the extent of the subsequent increases in the recoverable amount of investment.

Profit or loss in up- and downstream transactions between the consolidated company and the associates or transactions between associates shall only be recognized in the Consolidated Financial Statements when it is not related to the consolidated company's interest in the associates.

i. Property, Plant and Equipment

Property, plant and equipment are recognized at cost, and then measured at cost less accumulated depreciation and accumulated impairment.

Freehold land is not depreciated.

The depreciation of property, plant and equipment is separately recognized using the straight-line method over their useful lives to each significant part. The Company reviews the estimated useful lives, residual values and depreciation method at least at the end of each reporting period, with the effect of any changes in estimates accounted for on a prospective basis.

Upon disposal of property, plant and equipment, the difference between the net sales proceeds and the carrying amount of the asset is recognized in profit or loss.

j. Investment Properties

Investment property is a property held to earn rental and/or for capital appreciation. Investment property also includes land held for future use that is currently undetermined. Investment property is initially measured at cost, including transaction costs. Subsequent to initial recognition, investment property is measured at cost less accumulated depreciation and accumulated impairment loss. Depreciation of investment properties is recognized using the straight-line method.

Upon disposal of investment properties, the difference between the net sales proceeds and the carrying amount of the asset is recognized in profit or loss.

k. Contract cost-related assets

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Sales service fees paid for sales of real estate under exclusive sales contract of property held for sale are only incurred at the time of obtaining a client's contract, and are recognized as an additional cost of obtaining the contract to the extent the amounts are recoverable, and are written off when the legal ownership of the real estate is passed to the client.

Impairment of tangible and intangible assets (excluding goodwill) and related assets of contract costs

On each balance sheet date, the consolidated company reviews the carrying amounts of its tangible and intangible assets (excluding goodwill) to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. If corporate assets can be allocated to cash-generating units with a reasonable and consistent basis, then they are allocated to their individual cash-generating units. Otherwise, they are allocated to the smallest group of cash generating units for which a reasonable and consistent allocation basis can be identified. For intangible assets with indefinite life and that are not yet available for use, they are subject to annual impairment test at the time there are indications of impairment.

The recoverable amount is the higher of fair value less costs to sell and value in use. If the recoverable amount of an individual asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the asset or the cash-generating unit is reduced to its recoverable amount, with the resulting impairment loss recognized in profit or loss.

An impairment loss on inventory, property, plant and equipment, and intangible asset related to the contracts with customers shall be recognized in accordance with the applicable standards of inventory impairment and the above-mentioned principles. Then, the impairment loss is recognized to the extent that the carrying amount of the assets related to contract costs exceeds the remaining amount of consideration that the Company expects to receive in exchange for related goods or services less the direct costs related to providing those goods or services. The assets related to the contract costs are then included in the carrying amount of the cash-generating unit to which they belong for the purpose of evaluating impairment of that cash-generating unit.

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When an impairment loss is subsequently reversed, the carrying amount of the corresponding asset, cash-generating unit or assets related to contract costs is increased to the revised estimate of its recoverable amount, but only to the extent of the carrying amount, less any amount of amortization or depreciation, that would have been determined had no impairment loss been recognized on the asset in prior years. A reversal of an impairment loss is recognized in profit or loss.

m. Financial Instruments

Financial assets and liabilities shall be recognized in the consolidated balance sheets when the consolidated company becomes a party to the contractual provisions of the instruments.

While financial assets and liabilities are initially recognized, transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities are added to or deducted from the fair value of those financial assets and financial liabilities that are not measured at fair value through profit or loss. Transaction costs directly attributable to the acquisition or issue of financial assets or financial liabilities measured at fair value through profit or loss are recognized immediately in profit or loss.

1) Financial assets

Regular way transactions of financial assets are recognized and derecognized on a settlement date basis.

(a) Category of measurement

Financial assets held by the consolidated company are classified into the following categories: financial assets at fair value through profit or loss (FVTPL), financial assets at amortized cost, and investments in equity instruments at fair value through other comprehensive income (FVTOCI).

i. Financial asset at FVTPL

Financial asset at FVTPL include those mandatorily measured at FVTPL and those designated as such. Financial assets mandatorily measured at FVTPL include equity instrument investments that the consolidated company has not designated to be measured at FVTOCI, as well as debt instrument investments that do not qualify for classification as measured at amortized cost or at FVTOCI.

Financial asset at FVTPL is measured at fair value, and any dividends or interests from such financial assets are recognized in other revenues. Any remeasurement gain or loss on such financial assets are recognized in

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other gain or loss. For the determination of fair value, please refer to Note 28.

ii. Financial asset measured at amortized cost

The consolidated company's investments in financial assets that meet the following two conditions are subsequently measured at amortized cost:

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

Subsequent to initial recognition, financial assets measured at amortized cost, including cash and cash equivalents, notes receivable, trade receivable, and other receivable, are measured at amortized cost of total carrying amount determined by the effective interest method less any impairment loss. Any foreign exchange gain/loss is recognized in profit or loss.

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

i) Purchased or originated credit-impaired financial assets, for which interest income is calculated by applying the credit-adjusted effective interest rate to the amortized cost of such financial assets; and
ii) Financial assets that are not credit-impaired on purchase or origination but have subsequently become credit-impaired, for which interest income is calculated by applying the effective interest rate to the amortized cost of such financial assets in subsequent reporting periods.

Credit-impaired financial assets are those where the issuer or debtor has experienced major financial difficulties, defaults, the debtor is likely to file for bankruptcy or other financial restructuring, or disappearance of an active market for the financial assets due to financial difficulties.

Cash equivalents comprise time deposits that will mature within 3 months after the acquisition date, that are highly liquid and readily convertible to known amount of cash, and that are subject to an

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insignificant risk of changes in value. Cash equivalents are used to satisfy short-term cash commitments.

iii. Investments in equity instruments at FVTOCI

On initial recognition, the consolidated company may make an irrevocable election to designate investments in equity instruments as at FVTOCI. Designation as at FVTOCI is not permitted if the equity investment is held for trading or if it is contingent consideration recognized by an acquirer in a business combination.

Investments in equity instruments at FVTOCI are measured at fair value and subsequently measured at fair value with gain or loss arising from changes in fair value recognized in other comprehensive income and accumulated in other equity. The cumulative gain or loss will not be reclassified to profit or loss on disposal of the equity investments; instead, it will be transferred to retained earnings.

Dividends on these investments in equity instruments at FVTOCI are recognized in profit or loss when the Company's right to receive the dividends is established, unless the dividends clearly represent a recovery of part of the cost of the investment.

(b) Impairment of financial assets

On each date of balance sheets, the consolidated company evaluates a loss allowance for financial assets at amortized cost (including trade receivable) based on expected credit loss.

The loss allowances for notes receivable and trade receivables are recognized at an amount equal to lifetime expected credit losses. Other financial assets are first evaluated whether or not the credit risk has increased significantly since initial recognition. If it has not increased significantly, a loss allowance is recognized at an amount equal to expected credit loss within 12 months. If it has increased significantly, a loss allowance is recognized at an amount equal to expected credit loss over the expected life.

Expected credit losses are the weighted average credit losses resulting from a risk of default events as the weight. Expected credit losses within 12 months represent the expected credit losses resulting from possible default events of a financial instrument within 12 months after the reporting date. Expected credit

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loss over the expected life represent the expected credit losses resulting from all possible default events of a financial instrument over the expected life.

For the purpose of internal credit risk management, the consolidated company, without considering the collateral it holds, determines that the following circumstances represent a default in financial assets:

i. There are internal or external information showing that the borrower is no longer able to pay off the debt.

ii. Where the debt is overdue more than 365 days, unless there is reasonable and authenticated information showing that the delayed default basis is more appropriate.

An impairment loss of all financial assets is recognized with a corresponding adjustment to their carrying amount through a loss allowance account.

The consolidated company derecognizes a financial asset only when the contractual rights to the cash flows from the financial asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the financial asset to another entity.

On derecognition of a financial asset at amortized cost in its entirety, the difference between the asset's carrying amount and the sum of the consideration received and receivable is recognized in profit or loss. On derecognition of equity instruments measured at FVTOCI in its entirety, the cumulative gain or loss will not be reclassified to profit or loss; instead, it will be transferred to retained earnings.

2) Equity instruments

Debt and equity instruments issued by the consolidated company are classified separately as financial liabilities or equity in accordance with the substance of contractual arrangements and the definitions of a financial liability and an equity instrument.

The equity instrument issued by the consolidated company shall be recognized by the payment for acquisition net of the direct cost of issuance.

The repurchase of equity instruments issued by the consolidated company is recognized in equity as a deduction. The purchase, sale, issuance, or write-off of the consolidated company's own equity instruments is not recognized in profit or loss.

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3) Financial liabilities

(a) Subsequent measurement

All financial liabilities are subsequently measured either at amortized cost using effective interest method, except below situations.

(b) Derecognition of financial liabilities

The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable, including liabilities of any transferred non-cash asset or afforded liabilities, is recognized in profit or loss.

n. Revenue recognition

The consolidated company identifies contracts with customers, allocates the transaction price to the performance obligations and recognizes revenue when performance obligations are satisfied.

1) Sales revenue of building and land

The consolidated company is principally engaged in appointments and management of contractors for the construction and sales of real estate, and the revenue is recognized when the legal ownership of the real estate is passed to the client. For the signed contract of residence sale, subject to the commercial practice, the real estate has no other use for the consolidated company. As the legal ownership of the real estate is passed to the client, the consolidated company has an enforceable right to the contractual amount and therefore revenue is recognized when the legal ownership of the real estate is passed to the client.

2) Construction revenue

For construction contracts where the property under construction is controlled by the customer during the process, the consolidated company recognizes revenue over time. Since the costs incurred in construction are directly related to the completion of performance obligations, the consolidated company measures the progress of completion using the ratio of actual costs incurred to the total expected costs. During the construction process, the company recognizes contract assets incrementally and reclassifies them as accounts receivable when invoices are issued. If the project payments received exceed the recognized revenue, the difference is recorded as contract liabilities. Retention money withheld by the customer under the contract terms serves to ensure that the consolidated company fulfills all

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contractual obligations and is recognized as contract assets until the obligations are fully performed.

If the outcome of the performance obligations cannot be measured reliably, construction revenue is recognized only to the extent of the costs incurred for satisfaction of performance obligations that are expected to be recovered.

3) Service revenue

Service revenue is recognized when services are provided.

Revenue generated from providing services under contracts is recognized based on the stage of completion of the contract. The stage of completion is determined by recognizing revenue on a monthly basis over the contract period.

o. Lease

At the inception of a contract, the consolidated company assesses whether the contract is, or contains, a lease.

1) The consolidated company 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.

When the consolidated company subleases the right-of-use asset, the classification of the sublease is determined by the right-of-use asset (instead of the underlying asset). However, if the main lease is a short-term lease where the recognition exemption is applicable to the consolidated company, the sublease is classified as an operating lease.

After lease-related incentives are deducted, the rental income from operating lease is recognized on a straight-line basis over the term of the lease. The initial direct costs arising from acquisition of operating leases is added to the carrying amount of the underlying assets; and an expense is recognized for the lease on a straight-line basis over the lease term.

When a lease includes both land and building elements, the consolidated company assesses the classification of each element separately as a financial or an operating lease based on the assessment as to whether substantially all the risks and rewards incidental to ownership of each element have been transferred to the lessee. The lease payments are allocated between the land and the building elements in proportion to the relative fair values of the leasehold interests in the land element and building element of the lease at the inception of a contract. If the allocation of

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the lease payments can be made reliably, each element is accounted for separately in accordance with its lease classification. If the lease payments cannot be allocated reliably between the land and building elements, the entire lease is generally classified as a finance lease unless it is clear that both elements are operating leases; in which case, the entire lease is classified as an operating lease.

2) The consolidated company as lessee

The Company recognizes right-of-use assets and lease liabilities for all leases at the commencement date of a lease, except for short-term leases and low-value asset leases accounted for applying a recognition exemption where lease payments are recognized as expenses on a straight-line basis over the lease terms.

Right-of-use assets are measured initially at cost, which comprises the initial measurement of lease liabilities, the lease payments paid before the lease start date less the lease incentives received, the initial direct cost, and the estimated cost of restoring underlying assets. Subsequent measurement is calculated as cost less accumulated depreciation and accumulated impairment loss and adjusted for changes in lease liabilities as a result of remeasurement. Right-of-use assets are presented on a separate line in the consolidated balance sheets.

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 are initially measured at the present value of the lease payments, which comprise fixed payments and payments of penalties for terminating the lease reflected during the lease term less lease incentives received. The lease payments are discounted using the interest rate implicit in a lease, if that rate can be readily determined. If that rate cannot be readily determined, the Company uses 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. When there is a change in future lease payments resulting from a change in a lease term, the consolidated company remeasures the lease liabilities with a corresponding adjustment to the right-of-use assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. Lease liabilities are presented on a separate line item in the consolidated balance sheets.

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p. Borrowing costs

Borrowing costs directly attributable to an acquisition, construction or production of qualifying assets are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

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.

Other than that which is stated above, all other borrowing costs are recognized in profit or loss in the period in which they are incurred.

q. Employee benefits

1) Short-term employee benefits expense

Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for service rendered by employees.

2) Post-Retirement Benefits

Payments of defined contribution retirement benefit plans are recognized as an expense when the employees have rendered service entitling them to the contribution.

r. Income tax

Income tax expense is the sum of current income tax and deferred income tax.

1) Current tax

The consolidated company determines current income (loss) based on the regulations established by the tax reporting jurisdiction, which is used to calculate the current income tax payable (recoverable).

According to the Income Tax Law of the ROC, an additional income tax on unappropriated earnings was surcharged in the year approved by the shareholders' meeting.

Adjustments of prior years' tax liabilities are added to or deducted from the current year's tax provision.

2) Deferred income tax

Deferred income tax is calculated on temporary differences between the carrying amounts of the recorded assets and liabilities and the corresponding tax bases used in the computation of taxable profit.

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Deferred tax liabilities are generally recognized for all taxable temporary differences while deferred tax assets are recognized as it is very likely that taxable profits will be available against tax credits which those deductible temporary differences can be utilized.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries, except where the Company is able to control the timing of the reversal of the temporary difference and it is very likely that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investment and equity are only recognized to the extent that it is very likely that there will be sufficient taxable profit against which to utilize the benefit of the temporary differences that are expected to reverse in the foreseeable future.

The carrying amount of deferred tax asset is reviewed on each date of balance sheets and it is reduced to the extent that it is no longer very likely that sufficient taxable profits will be available to allow all or part of the deferred tax asset to be recovered. The deferred tax assets not originally recognized are also reviewed on each date of balance sheets, and their carrying amount is recognized to the extent that it is very likely that sufficient taxable profits will be available to allow all or part of the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year in which the liability is settled or the asset is realized, and this tax rates is based on the tax rates and tax laws that have been enacted or substantively enacted on the date of balance sheet. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Company expects to recover or settle the carrying amount of its assets and liabilities on the date of balance sheet.

3) Current and deferred income tax

Current and deferred income taxes are recognized in profit or loss, unless when they relate to items that are recognized in other comprehensive income or directly recorded in equity, the current and deferred income tax are separately recognized in other comprehensive income or directly recorded in equity.

Primary Sources of Uncertainties in Major Accounting Judgments, Estimates, and Assumptions
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In the application of the consolidated company's accounting policies, the management is required to make judgments, estimates and assumptions based on historical experience and other factors that are considered to be relevant for the items that are not readily apparent from other sources. Actual results may differ from these estimates.

When the consolidated company develops significant accounting estimates, the management will constantly review the estimations and underlying assumptions.

Key Sources of Estimation and Assumption Uncertainty

Estimated impairment loss of inventory

The consolidated company regularly assesses the carrying amounts of the inventories to determine, in accordance with the accounting policy, that the inventories are stated at the lower of cost or net realizable value. The consolidated company estimates the net realizable value based on the most recent average selling prices of similar inventories and its historical experiences. Changes in the net realizable value will increase or decrease the amount of the Company's inventories.

6. Cash and Cash Equivalents

	December 31, 2025	December 31, 2024
Cash on hand and working capital	$ 1,272	$ 1,319
Bank checks and demand deposits	408,687	288,065
Bank time deposits with original maturity date within 3 months	962,500	1,042,020
	$ 1,372,459	$ 1,331,404

The market interest rate intervals of bank deposits on the balance sheet date are as follows:

	December 31, 2025	December 31, 2024
Bank deposits	0.05%-0.71%	0.05%-0.71%
Bank time deposits	1.60%	1.255%-1.70%

7. Notes Receivable, Trade Receivables, Trade Receivables – Related Parties, Other Receivables, and Other Receivables – Related Parties

	December 31, 2025	December 31, 2024
Measured at amortized cost
Notes receivable	$ 428	$ 217
Installment notes receivable	-	592
	$ 428	$ 809
Trade receivables	$ 5,646	$ 6,139
Trade receivables from related parties	5,147	6,458
	$ 10,793	$ 12,597
Other receivables	$ 961	$ 6,894
Other receivables - related party	800,043	1,654,943
	$ 801,004	$ 1,661,837

a. Notes and trade receivable

The consolidated company mainly engaged in appointments of construction contractors to build public housing developments for leasing and selling. As a result, the trade receivables of the consolidated company arose from the purchase of building and land sold by the consolidated company's clients and the collection terms of the receivables are in accordance with the sales contracts. In the case of trade receivables arising from the lack of loan facilities from clients, the consolidated company may, after assessing their credit status and repayment ability, collect the amounts by installment of bills receivable based on agreed terms.

In addition to trade receivables of real estate, the consolidated company has trade receivables arising from rental with lease guarantee deposits received in advance. In assessing the recoverability of trade receivables, the consolidated company considers any change in the credit quality of the trade receivables from the original credit date to the balance sheet date and estimates the irrecoverable amounts by reference to past default records and the current financial condition of the clients and industrial economic conditions. The lease guarantee deposits received by the consolidated company at the balance sheet date are sufficient to cover potential default losses.

The consolidated company applies the simplified approach of IFRS 9 and recognizes allowance for uncollectible accounts for trade receivables as lifetime expected credit losses for the duration of contract. The lifetime expected credit loss is determined the provision matrix which refers to past default records and the current financial condition of the clients and industrial economic conditions. Due to the historical experience of credit losses of the consolidated company, there is no significant difference in the loss patterns of different client's groups. Therefore, the provision matrix does not further distinguish the customer base, and only sets the expected credit loss rate based on the overdue days of trade receivables.

The consolidated company writes off trade receivable when there is information indicating that the debtor is experiencing in severe financial difficulty and there is no realistic prospect of recovery. The consolidated company continues to engage in enforcement activity to attempt to recover the receivables due. Where recoveries are made, they are recognized in profit or loss.

The loss on provision for accounts receivable measured by the consolidated company is as follows:

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December 31, 2025

	Not overdue	Due over 1 ~ 365 days	Due over 365 days	Total
Expected credit loss rate	-	-	100%
Total carrying amount	$ 10,793	$ -	$ -	$ 10,793
Allowance for loss (lifetime expected credit losses)	-	-	-	-
Costs after amortization	$ 10,793	$ -	$ -	$ 10,793

December 31, 2024

	Not overdue	Due over 1 ~ 365 days	Due over 365 days	Total
Expected credit loss rate	-	-	100%
Total carrying amount	$ 12,597	$ -	$ -	$ 12,597
Allowance for loss (lifetime expected credit losses)	-	-	-	-
Costs after amortization	$ 12,597	$ -	$ -	$ 12,597

b. Other receivables

The consolidated company's loss allowance for other receivable was as follows:

December 31, 2025

	Not overdue	Due over 1 ~ 365 days	Due over 365 days	Total
Expected credit loss rate	-	-	100%
Total carrying amount	$ 801,004	$ -	$ -	$ 801,004
Allowance for loss (lifetime expected credit losses)	-	-	-	-
Costs after amortization	$ 801,004	$ -	$ -	$ 801,004

December 31, 2024

	Not overdue	Due over 1 ~ 365 days	Due over 365 days	Total
Expected credit loss rate	-	-	100%
Total carrying amount	$1,661,837	$ -	$ -	$1,661,837
Allowance for loss (lifetime expected credit losses)	-	-	-	-
Costs after amortization	$1,661,837	$ -	$ -	$1,661,837

34 -

8. Inventories

	December 31, 2025	December 31, 2024
Real estate under development	$ 587,408	$ 4,381,733
Real estate held for development	6,727,490	4,249,708
Building and land held for sale	3,913,266	909,215
Merchandise inventory	46,094	45,617
	$ 11,274,258	$ 9,586,273

In April 2025, the Group transferred Xizhi Li Garden and Hung Ching Qing Yun for leasing purposes and reclassified them from properties held for sale to investment property. Please refer to Note 14.

As of December 31, 2025 and 2024, inventories of NT$7,972,887 thousand and NT$9,279,622 thousand, respectively, are expected to be recovered after more than 12 months. The relevant amounts of operating cost and inventory were as follows:

	2025	2024
Cost of sold properties	$ 78,443	$ 5,212,022
Other operating costs	1,514	2,344
	$ 79,957	$ 5,214,366
The abovementioned cost of goods sold includes
Inventory write-down losses (reversal of write-down gains)	($ 55,266)	$ 135,170

The reversal of inventory write-down losses (write-down gains) for the year 2025 arose from the reversal of prior write-downs on the ASE and Mudan development projects, as well as the recognition of inventory write-down losses for the Banqiao Puqian Section and Hsinchu Lianhua Section projects.

The inventory impairment loss for 2024 was recognized for the Hsinchu Lianhua section of land and was offset by the reversal of the impairment loss related to the Mudan construction project.

Please refer to Note 28 for the amount of inventory pledged by the consolidated company as collateral against its secured borrowings.

9. Financial Assets Measured at Fair Value through Other Comprehensive Income - Non-current

Investments in equity instruments at FVTOCI

	December 31, 2025	December 31, 2024
Non-current
Domestic investment
Listed Shares	$ 11,111,480	$ 7,171,987
Non-listed (OTC) stock	46,656	30,809
	$ 11,158,136	$ 7,202,796

The consolidated company invested in equity instruments pursuant to its medium-term and long-term strategies for the purpose of making a profit; thus, the consolidated company elected to designate these investments to be measured at FVTOCI.

Please refer to Note 28 for information about investments in equity instruments at FVTOCI pledged as collateral.

10. Subsidiaries

Subsidiaries included in the consolidated financial statements

The entities of the consolidated financial statements are as follows:

Name of Investor Company	Name of Subsidiary	Business Nature	Percentage of Ownership and Voting Rights		Note
			December 31, 2025	December 31, 2024
The Company	Hung Ching Kuan Co., Ltd. (Hung Ching Kuan)	Leasing of mall and office building	63.5%	63.5%	Note
	Fuhua engineering Co., Ltd. (Fuhua engineering)	Contractor of construction projects	100%	100%	Note
	Hung Ching New Co., Ltd. (Hung Ching New)	Retailer of household equipment and supplies	100%	100%	Note
	ASE WeMall Management and Consulting Co., Ltd. (ASE WeMall M&C Co.)	Consultant of operation and management in department stores and parking lots	100%	100%	Note
	Hung Ching Co., Limited	General investment	100%	100%	Note
	Superb First Co., Ltd.	General investment	100%	100%	Note
	Luchu Development Corporation (Luchu Development)	Real estate development	96.5%	96.5%	Note
Hung Ching Co., Limited	Shanghai Youhong Engineering Technical Consulting Co., Ltd.	Technical consulting services of electronic engineering and architectural engineering	100%	100%	Note

(Continued on the next page)

(Continued from the previous page)

Name of Investor Company	Name of Subsidiary	Business Nature	Percentage of Ownership and Voting Rights		Note
			December 31, 2025	December 31, 2024
Shanghai Youhong Engineering Technical Consulting Co., Ltd.	Shanghai Hong Kong Property Management Co., Ltd.	Consulting services of property management and construction and technical consulting services of architectural engineering	100%	100%	Note
Superb First Co., Ltd.	Shanghai You Chang Property Management Co., Ltd.	Consulting services of property management and construction and technical consulting services of architectural engineering	100%	100%	Note

Note: It was compiled into the consolidated financial statement with the financial statements audited by the certified public accountant for the same period.

11. Investments Accounted for Using Equity Method

Investment in associates that are not individually material

	December 31, 2025	December 31, 2024
Ding Gu Properties Co., Ltd (Ding Gu Properties Co)	$ 1,426,093	$ 684,993

The Group participated in the cash capital increase of Ding Gu Properties in 2025. For detailed transaction information and explanations, please refer to Note 27.

The percentage of equity ownership and voting rights of the consolidated company in the associates were both 24% on the balance sheet date.

Information of associates not individually material is summarized as follows:

	2025	2024
The consolidated Company's share NET PROFIT FOR THE YEAR	$ 169,900	$ 113,998
Other comprehensive income/(loss)	-	-
Total comprehensive income/(loss)	$ 169,900	$ 113,998

12. Property, Plant and Equipment

	Land	Buildings and Property	Other Equipment	Total
Cost
Balance as of January 1, 2024	$ 522,743	$ 1,045,253	$ 33,834	$ 1,601,830
Addition	-	-	124	124
Net exchange difference	-	408	89	497
Balance as of December 31, 2024	$ 522,743	$ 1,045,661	$ 34,047	$ 1,602,451
Accumulated depreciation and impairment
Balance as of January 1, 2024	$ -	$ 530,456	$ 28,911	$ 559,367
Depreciation expenses	-	22,562	1,646	24,208
Net exchange difference	-	191	78	269
Balance as of December 31, 2024	$ -	$ 553,209	$ 30,635	$ 583,844
Net as of December 31, 2024	$ 522,743	$ 492,452	$ 3,412	$ 1,018,607
Cost
Balance as of January 1, 2025	$ 522,743	$ 1,045,661	$ 34,047	$ 1,602,451
Addition	-	-	6,367	6,367
Disposal	-	-	( 7,990 )	( 7,990 )
Net exchange difference	-	48	10	58
Balance as of December 31, 2025	$ 522,743	$ 1,045,709	$ 32,434	$ 1,600,886
Accumulated depreciation and impairment
Balance as of January 1, 2025	$ -	$ 553,209	$ 30,635	$ 583,844
Depreciation expenses	-	19,190	1,367	20,557
Disposal	-	-	( 7,987 )	( 7,987 )
Net exchange difference	-	44	10	54
Balance as of December 31, 2025	$ -	$ 572,443	$ 24,025	$ 596,468
Net as of December 31, 2025	$ 522,743	$ 473,266	$ 8,409	$ 1,004,418

Property, plant and equipment of the consolidated company are depreciated by straight-light method using the estimated useful lives as follows:

Buildings and Property 20 to 60 years
Other Equipment 2 to 10 years

Please refer to Note 28 for information about the amount of property, plant and equipment pledged by the consolidated company as collateral for borrowings.

38 -

13. Lease Arrangements

a. Right-of-use assets

	December 31, 2025	December 31, 2024
Carrying amount of right-of-use assets
Land	$ -	$ -
	2025	2024
Increase in right-of-use assets	$ -	$ -
Decrease in right-of-use assets	$ -	($ 5,350)
Depreciation expense of right-of-use assets
Land	$ -	$ 1,416

Except for the termination of leases for lands and the recognition of depreciation expenses in October 2024, the consolidated company's right-of-use assets did not undergo significant additions, subleases, or impairments during the periods from January 1 to December 31 of 2025 and 2024.

b. Lease liabilities

	December 31, 2025	December 31, 2024
Carrying amount of lease liabilities
Current	$ -	$ -
Non-current	$ -	$ -

Ranges of discount rates for lease liabilities are as follows:

	December 31, 2025	December 31, 2024
Land	-	-

c. Major lease activities and terms

The consolidated company leases land with a lease term of five years, with the option to renew once, provided that the total lease period does not exceed ten years. At the end of the lease term, the consolidated company does not have a preferential purchase right for the leased land. The company terminated the lease agreement for land in October 2024.

d. Other lease information

Please refer to Note 14 for the operating lease agreements to rent its own merchandise inventory and investment properties by the consolidated company.

The consolidated company leases certain office equipment and certain equipment which qualify as short-term leases and low-value asset leases. The consolidated company has elected to apply the recognition exemption and thus, did not recognize right-of-use assets and lease liabilities for these leases.

	2025	2024
Expenses relating to short-term leases and low-value asset leases	$ 4,332	$ 7,438
Total cash (outflow) for leases	($ 4,332)	($ 8,910)

14. Investment Properties

	Land	Buildings and Property	Total
Cost
Balance as of January 1, 2024	$ 1,030,099	$ 3,884,849	$ 4,914,948
Addition	-	5,593	5,593
Disposal	-	( 4,235)	( 4,235)
Balance as of December 31, 2024	$ 1,030,099	$ 3,886,207	$ 4,916,306
Accumulated depreciation and impairment
Balance as of January 1, 2024	$ 84,201	$ 1,325,516	$ 1,409,717
Depreciation expenses	-	105,597	105,597
Balance as of December 31, 2024	$ 84,201	$ 1,431,113	$ 1,515,314
Net as of December 31, 2024	$ 945,898	$ 2,455,094	$ 3,400,992
Cost
Balance as of January 1, 2025	$ 1,030,099	$ 3,886,207	$ 4,916,306
Addition	-	5,767	5,767
Reclassification from inventories	44,508	61,956	106,464
Balance as of December 31, 2025	$ 1,074,607	$ 3,953,930	$ 5,028,537
Accumulated depreciation and impairment
Balance as of January 1, 2025	$ 84,201	$ 1,431,113	$ 1,515,314
Reversal of impairment losses and reclassification	979	( 46,889)	( 45,910)
Depreciation expenses	-	119,334	119,334
Balance as of December 31, 2025	$ 85,180	$ 1,503,558	$ 1,588,738
Net as of December 31, 2025	$ 989,427	$ 2,450,372	$ 3,439,799

The investment property of the consolidated company includes the mall of Tucheng ASE, the building of Hotel J Metropolis held by the Company, and the exhibition hall of Asehome Design Center held by the subsidiary of Hung Ching Kuan.

During 2025, the Group reversed impairment losses recognized for the Zhongli wastewater treatment plant under investment properties. In 2024, there were no other significant additions, disposals, or impairment events.

Investment properties are depreciated by straight-light method using the estimated useful lives as follows:

Buildings and Property
49 to 60 years

The fair value of the investment property is derived by reference to appraisal report evaluated by appraisal company of non-related party and to the actual price registration of in the adjacent area by the management. Evaluation of fair value is shown below:

Fair value
December 31, 2025
$4,630,900
December 31, 2024
$7,138,470

The operating lease is to lease merchandise inventory and investment property owned by the consolidated company leases with lease terms of 1 to 20 years. The lessee does not have bargain purchase options to acquire the leasehold buildings at the end of the lease terms.

As of December 31, 2025 and 2024, the guarantee deposits received by the consolidated company in accordance with operating lease agreements amounted to $30,332 thousand and $30,182 thousand, respectively.

The total future lease payments to be received of operating lease commitments (excluding variable lease payments) are as follows:

	December 31, 2025	December 31, 2024
1st Year	$ 114,684	$ 115,686
2nd Year	69,593	63,737
3rd Year	52,541	49,865
4th Year	31,487	37,702
5th Year	23,631	29,103
Over 5 years	93,372	119,486
	$ 385,308	$ 415,579

The consolidated company held freehold interests in all of its investment properties. Please refer to Note 28 for the amount of investment properties pledged by the consolidated company as collateral for borrowings.

40 -

41 -

15. Other Financial Assets - Current

Other financial assets consist of fixed deposits with original maturities exceeding three months. The range of interest rates is as follows:

	December 31, 2025	December 31, 2024
Current
New Taiwan Dollar	1.46%	1.46%

16. Prepayments

	December 31, 2025	December 31, 2024
Current
Tax overpaid retained for offsetting the future tax payable	$ 56,196	$ 29,915
Prepayments for construction and purchases (Note 28)	2,384,342	2,339,238
Prepaid expenses	3,745	3,482
	$ 2,444,283	$ 2,372,635

17. Borrowings

a. Short-term borrowings

	December 31, 2025	December 31, 2024
Bank credit loans	$ 600,000	$ 460,000
Bank secured loan (Note 28)	2,608,000	5,237,000
	$ 3,208,000	$ 5,697,000
Interest rate of bank credit loans	2.20%-2.38%	2.23%-2.38%
Interest rate of bank secured loans	2.18%-2.96%	2.17%-2.96%

b. Short-term bills payable

	December 31, 2025	December 31, 2024
Commercial paper payable (Note 28)	$ 5,278,500	$ 4,502,500
Less: discount on short-term bills payable	12,029	11,415
	$ 5,266,471	$ 4,491,085
Interest rate	2.478%-3.068%	2.618%-2.978%

c. Long-term borrowings

	December 31, 2025	December 31, 2024
Bank Loan(Note28)
Secured Borrowings
Bank of Taiwan (1)	$ 1,331,806	$ 1,492,415
Bank of Taiwan (2)	1,500,000	410,000
KGI Bank (3)	200,000	200,000
Mega Bank (4)	1,850,000	-
	4,881,806	2,102,415
Less: Current portion matured in one year	1,684,864	360,609
Subtotal	3,196,942	1,741,806
Long term commercial paper payable (5)	204,000	-
Less: long term commercial paper payable	297	-
Subtotal	203,703	-
Long-term borrowings	$ 3,400,645	$ 1,741,806
Interest rate	2.62%-3.05%	2.62%-2.97%

1) The maturity date of the consolidated company's loan from Bank of Taiwan I is May 16, 2033 with repayment method of interests paid monthly and principal paid by installments starting the third year, and with Tucheng mall as collateral.
2) The maturity date of the consolidated company's loan from Bank of Taiwan is May 2, 2026 with repayment method of interests paid monthly and principal paid by installments, and with ASE Second Factory as collateral.
3) The maturity date of the Group's loan from KGI Bank is August 28, 2028 with repayment method of interests paid monthly and principal paid by the date of maturity, and the collateral is Lianhua Section land in Hsinchu.
4) The Group's loan with Mega International Commercial Bank matures on December 26, 2028. The repayment terms require that the first installment of principal be repaid six months from the initial drawdown date, with subsequent repayments made every six months thereafter. For the first to fifth installments, principal of NT$10,000 thousand shall be repaid each period, and the remaining outstanding principal shall be fully settled in the sixth installment. The loan is secured by Luchu shares.
5) The Group's loan with DBS Bank matures on December 31, 2026 and is issued on a revolving basis in accordance with the terms of the agreement. The loan is secured by the Kaohsiung K28 factory building.

Trade Payables

Trade payables classified as construction retainage payable for construction contracts were NT$310,783 thousand and NT$317,512 thousand as of December 31, 2025 and 2024. Construction retainage received, which is interest free, will be paid for each construction contract at the end of the construction retainage period. This retainage period is the consolidated company's normal operating cycle, which normally exceeds one year.

19. Post-retirement Benefit Plans

The consolidated company adopted a pension plan under the Labor Pension Act, which is a government-managed defined contribution plan. The Company has made monthly contributions equal to 6% of each employee's monthly salary to employees' individual pension accounts of Bureau of Labor Insurance.

In accordance with the relevant endowment insurance system of the People's Republic of China, Shanghai Youhong Engineering Technical Consulting Co., Ltd. Shanghai Hong Kong Property Management Co., Ltd., and Shanghai You Chang Property Management Co., Ltd. allocate fund of the endowment insurance according to a certain proportion of the salary each year, and contribute them to the designated institutions stipulated by the government of the People's Republic of China. Once the funds are allocated, they are managed by the local government labor department.

20. Equity

a. Share capital

Ordinary shares

	December 31, 2025	December 31, 2024
Authorized shares (In Thousand Shares)	540,306	540,306
Authorized share capital	$ 5,403,060	$ 5,403,060
Issued and fully paid shares (In Thousand Shares)	270,306	270,306
Issued share capital	$ 2,703,060	$ 2,703,060

The par value of the issued ordinary shares is $10 per share. Each share is entitled to one voting right and right of receiving dividend.

b. Capital Surplus

	December 31, 2025	December 31, 2024
To offset a deficit, to distribute as cash dividends or stock dividends
Additional paid-in capital	$ 148,999	$ 148,999
Treasury stock transaction	239,636	222,541
	$ 388,635	$ 371,540

The abovementioned capital surplus may be used to offset a deficit or to be distributed as cash dividends or stock dividends; however, the stock dividends have a limitation up to a certain percentage of the paid-in capital per year.

c. Retained earnings and dividend policy

According to the Company's Articles of Incorporation of the earnings distribution policy, the Company shall make appropriations from its net income (less any deficit), if any, to pay the taxes in comply with the laws, offset its accumulated deficit, set aside a legal reserve at 10% of the remaining earnings while no more set-aside if the legal reserve is up to the Company's paid-in capital, and then set aside or reverse a special reserve in accordance with the relevant laws or regulations. Of the remainder, together with any unappropriated earnings of prior years, shall be proposed by the Board of Directors as a plan for the distribution of the remaining undistributed earnings, and the shareholders shall resolve such plan in the shareholders' meeting for distribution of dividends to shareholders. For the policies on employees' compensation and remuneration of directors, which is stipulated in the Company's Articles of Incorporation, please refer to Note 22(8).

The Company's current industrial development is in a mature period while the business development is still at a growth stage with investment plans and funding requests in the coming years. Therefore, in addition to the abovementioned policies, the distribution of earnings shall be based on at least 20% by cash dividends and the remainder shall be distributed in the form of stock dividends as distribution of shareholders' dividends and bonuses for the year. However, if the Company obtains sufficient funds from external parties to meet its funding requests for the year, the proportion of cash dividends distributed above shall be increased to 40% on a discretionary basis.

As stated in the preceding paragraph, the Company may determine the most appropriate dividend policy and payment method depending on the actual operation of the year and taking into account the capital budget planning for the subsequent year.

The Company shall set aside a legal reserve until it equals the Company's paid-in capital. Legal reserve may be used to offset deficit. If the company has no deficit and the legal reserve has exceeded 25% of the company's paid-in capital, the excess may be transferred to capital or distributed in cash.

The appropriations of earnings for 2024 and 2023 had been approved in the shareholders' meetings on June 19, 2025 and June 25, 2024, respectively, and they were as follows:

44 -

	Appropriation of Earnings		Dividends per share (NT$)
	2024	2023	2024	2023
Legal reserve	$ 127,234	$ 44,624
Reversal of special capital reserve	( 86,759)	( 60,261)
Cash dividends	540,612	405,459	$ 2.00	$ 1.50

The Board of Directors of the Company on March 6, 2026 proposed the following appropriation of the 2025 earnings and dividends per share:

	Appropriation of Earnings	Dividends per share (NT$)
Legal reserve	$ 24,469
Special reserve	75,647
Cash dividends	405,459	$ 1.50

The appropriations of earnings for the year ended December 31, 2025 is subject to the resolution of the shareholders in the shareholders' meeting to be held on June 24, 2026.

d. Special reserve

	2025	2024
Balance, beginning of year	$ 274,472	$ 334,733
Reversal of special reserve	( 86,759)	( 60,261)
Balance, end of year	$ 187,713	$ 274,472

A special capital reserve shall be provided for the difference between the market price of the Company's shares held by the subsidiaries and the book value in proportion to their shareholdings and may be subsequently reversed as a result of the recovery of the market price.

e. Other equity items

1) Exchange differences on translating the financial statements of foreign operations

	2025	2024
Balance, beginning of year	($ 2,578)	($ 6,505)
Exchange differences on translating the net assets of foreign operations	818	4,909
Related income tax from gain on translating the net assets of foreign operations	( 163)	( 982)
Balance, end of year	($ 1,923)	($ 2,578)

2) Unrealized gain (loss) on financial assets at fair value through other comprehensive income

	2025	2024
Balance, beginning of year	$ 6,273,586	$ 5,100,645
Recognized for the year	3,953,618	1,172,941
Balance, end of year	$ 10,227,204	$ 6,273,586

f. Treasury Shares

(Unit: In Thousand Shares)

Reasons for repurchase	Number of shares, beginning of year	Increase for the year	Decrease for the year	Number of shares, end of year
2025
Shares of the Company held by subsidiaries	8,548	-	-	8,548
2024
Shares of the Company held by subsidiaries	8,548	-	-	8,548

Information on shares of the Company held by subsidiaries on the balance sheet date is as follows:

Name of Subsidiary	Number of shares held (thousand shares)	Carrying amount	Market price
December 31, 2025
Hung Ching New Co., Ltd.	8,548	$ 248,311	$ 248,311
December 31, 2024
Hung Ching New Co., Ltd.	8,548	$ 323,958	$ 323,958

The shares of the Company held by subsidiaries, which are considered as treasury shares, are bestowed shareholders' rights, except for the rights to participate in any share issuance for cash and to vote.

Revenue

a. Contract balances

47 -

	December 31, 2025	December 31, 2024
Notes receivable (Note 7)	$ 428	$ 809
Trade receivables - net (Note 7)	$ 5,646	$ 6,139
Trade receivables from related parties (Note 7)	$ 5,147	$ 6,458
Contract liabilities – current
Building and land for sale	$ 1,071	$ 28,944
Merchandise sales	700	86
Real estate construction	793,162	-
	$ 794,933	$ 29,030

b. Subdivision of revenue from client contracts

For the detailed breakdown of revenue, please see Appendix 30.

In May 2025, at the customer’s request, the Group replaced the unit in a real estate sale.

Accordingly, the Group recognized sales returns of NT$77,084 thousand in the second quarter of 2025. A new purchase and sale agreement for the replacement unit has been executed, and the transfer of ownership and handover were completed in August 2025.

22. Net Income from Continuing Operation

a. Interest income

	2025	2024
Bank deposit interest	$ 11,875	$ 11,362
Interest income from fund loans (Note 27)	36,938	38,339
Interest income on financial assets at amortized cost	270	177
	$ 49,083	$ 49,878

b. Other income

	2025	2024
Dividend income	$ 233,722	$ 230,089
Others	90,254	13,448
	$ 323,976	$ 243,537

c. Other gains and losses

	2025	2024
Reversal of impairment losses on assets	$ 45,910	$ -
Gain or loss on financial assets measured at fair value through forced profit or loss	-	112
Other income (loss)	88	( 79 )
	$ 45,998	$ 33

d. Finance costs

	2025	2024
Interest on bank loans	$ 344,827	$ 366,050
Interest on loans from related parties (Note 26)	-	29,960
Interest on lease liabilities	-	72
Less: Amounts included in the cost of required assets	38,092	85,233
	$ 306,735	$ 310,849
Interest rate on interest capitalization	2.45%-2.76%	2.34%-2.93%

e. Depreciation and amortization

	2025	2024
Property, Plant and Equipment	$ 20,557	$ 24,208
Right-of-use assets	-	1,416
Investment Properties	119,334	105,597
Long-term prepayment expenses (recorded as other non-current assets)	2,656	2,997
Intangible assets	106	106
Total	$ 142,653	$ 134,324
Depreciation expenses summarized by function
Operating costs	$ 120,098	$ 107,785
Operating expenses	19,793	23,436
	$ 139,891	$ 131,221
Amortization expenses summarized by function
Operating expenses - administrative expenses	$ 2,762	$ 3,103

f. Direct operating expenses of investment properties

	2025	2024
Direct operating expenses of investment properties generating rental revenue	$ 138,138	$ 112,318

g. Employee Benefits Expenses

	2025	2024
Short-term employee benefits expense	$ 193,978	$ 264,101
Post-Retirement Benefits
Defined contribution plans	6,430	6,278
Other employee benefits	28,039	31,800
Total employee benefit expenses	$ 228,447	$ 302,179
Summarized by function
Operating costs	$ 69,795	$ 82,107
Operating expenses	158,652	220,072
	$ 228,447	$ 302,179

h. Employees' compensation and remuneration of directors

The Company accrued employees' compensation and remuneration of directors at the rates of 1% to 7% and no higher than 3% for employees' compensation and for remuneration of directors of net profit before tax, respectively. The employees' compensation and remuneration of directors for the years ended December 31, 2025 and 2024, which were approved by the Company's Board of Directors on March 6, 2026 and March 7, 2025, respectively, were as follows:

Accrual rates

	2025	2024
Employees' compensation	4.00%	3.00%
Remuneration of directors	2.00%	1.50%

Amount

	2025		2024
	Cash	Stock	Cash	Stock
Employees' compensation	$ 11,779	$ -	$ 45,108	$ -
Remuneration of directors	5,890	-	22,554	-

If there is a change in the amounts after the parent company only financial statements are authorized for issue, the differences are recorded as a change in the accounting estimate and adjusted in the accounts in the following year.

There was no difference between the actual amount paid of employees' compensation and remuneration of directors and the amount recognized in the parent company only financial statements for the years ended December 31, 2024 and 2023.

Information on the employees' compensation and remuneration of directors resolved by the Company's Board of Directors is available at the Market Observation Post System website of the Taiwan Stock Exchange.

23. Income Tax from Continuing Operations

a. Income tax expense recognized in profit and loss account

Major components of income tax expense are as follows:

	2025	2024
Current tax
In respect of the current year	$ 43,705	$ 141,754
Surcharges on unappropriated earnings	34,635	2,921
Land value increment tax	5,780	9,216
Adjustments for prior years	( 16,762 )	136
	67,358	154,027
Deferred income tax
In respect of the current year	9,538	52,889
Income tax expenses recognized in profit or loss	$ 76,896	$ 206,916

A reconciliation of accounting profit and current income tax expense is as follows:

	2025	2024
Net income from continuing operation	$ 299,907	$ 1,458,718
Income tax expenses from income before tax calculated at the statutory rate	$ 80,203	$ 387,149
Fees that cannot be deducted from taxes	2,008	3,354
Non-taxable income	( 79,604 )	( 235,417 )
Surcharges on unappropriated earnings	34,635	2,921
Land value increment tax	5,780	9,216

(Continued on the next page)

(Continued from the previous page)

	2025	2024
Unrecognized deductible temporary differences	38,134	28,178
Unrecognized loss carryforward	12,502	11,379
Income tax expenses from previous years adjusted for the year	( 16,762 )	136
Income tax expenses recognized in profit or loss	$ 76,896	$ 206,916

The tax rate for entities of the consolidated company that apply the Income Tax Act of the Republic of China is 20%. The tax rate applicable to subsidiaries in China area is 25%.

b. Income tax recognized in other comprehensive income

	2025	2024
Deferred income tax
Recognized for the year
— Translating of foreign operations	$ 163	$ 982
Income tax recognized in other comprehensive income	$ 163	$ 982

c. Deferred tax assets

The movements of deferred tax assets were as follows:

	Balance, beginning of year	Recognized in profit and loss	Recognized in other comprehensive income	Balance, end of year
2025
Deferred tax assets
Property, plant and equipment	$ 12,000	($ 9,522)	$ -	$ 2,478
Investment properties	14,473	-	-	14,473
Exchange differences of foreign operations	643	-	( 163)	480
Others	44	( 16)	-	28
	$ 27,160	($ 9,538)	($ 163)	$ 17,459

(Continued on the next page)

(Continued from the previous page)

	Balance, beginning of year	Recognized in profit and loss	Recognized in other comprehensive income	Balance, end of year
2024
Deferred tax assets
Loss carryforward	$ 54,289	($ 54,289)	$ -	$ -
Property, plant and equipment	12,242	( 242)	-	12,000
Investment properties	12,703	1,770	-	14,473
Exchange differences of foreign operations	1,625	-	( 982)	643
Others	172	( 128)	-	44
	$ 81,031	($ 52,889)	($ 982)	$ 27,160

d. Amounts of loss carryforward and deductible temporary differences for which no deferred tax assets have been recognized in the balance sheet

	December 31, 2025	December 31, 2024
Loss carryforward
Expired in 2025	$ -	$ 34,595
Expired in 2026	40,506	42,431
Expired in 2027	41,562	41,934
Expired in 2028	50,292	50,665
Expired in 2029	45,723	45,723
Expired in 2030	47,176	47,176
Expired in 2031	42,237	42,237
Expired in 2032	51,938	51,938
Expired in 2033	43,960	43,960
Expired in 2034	56,728	56,030
Expired in 2035	59,341	-
	$ 479,463	$ 456,689
Deductible temporary differences	$ 333,244	$ 320,868

e. Income tax assessments

The profit-seeking enterprise income tax filings of the Company and its subsidiaries in Taiwan have been assessed and approved by Taiwan's tax authorities up to the fiscal year 2023.

53 -

24. Earnings per Share

Numerator and denominator used in the computation of earnings per share (EPS) are as follows:

	Amount (numerator) after tax	Shares (denominator) (thousand shares)	Earnings per share (NT$) after tax
2025
Basic EPS
Net income to calculate basic EPS	$ 244,687	261,758	$ 0.93
Effect of dilutive potential ordinary share:
Employees' compensation	-	621
Diluted EPS
Net income to calculate diluted EPS	$ 244,687	262,379	$ 0.93
2024
Basic EPS
Net income to calculate basic EPS	$ 1,272,344	261,758	$ 4.86
Effect of dilutive potential ordinary share:
Employees' compensation	-	1,331
Diluted EPS
Net income to calculate diluted EPS	$ 1,272,344	263,089	$ 4.84

If the consolidated company offered to settle the employees' compensation in cash or shares, the consolidated company presumes that the entire amount of the compensation would be settled in shares and the resulting potential shares were included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, as the effect is dilutive. Such dilutive effect of the potential shares is included in the computation of diluted earnings per share until the shareholders resolve the number of shares to be distributed to employees as compensation at their meeting in the following year.

25. Management of Risks in Capital

The consolidated company conducts management of risks in capital to ensure that each entity of the consolidated company would continue as a going concern with the premise of optimizing the balances of debt and equity, and to maximize shareholders' equity. The overall strategy of the consolidated company has no significant change.

The consolidated company's capital structure consists of the consolidated company's net debt (which is borrowings less cash and cash equivalents) and equity attributable to the owners of the consolidated company (which are share capital, capital surplus, retained earnings, and other equity items).

The consolidated company is not subject to any other external capital requirements.

The key management of the consolidated company annually reviews the capital structure of the consolidated company, including the capital costs of various categories and related risks. Based on recommendations of the key management, the consolidated company will balance its overall capital structure through dividends distribution, new stock issuance, shares repurchase, and new debts issuance or old debts repayment, etc.

26. Financial Instruments

a. Information on fair value - financial instruments not measured at fair value

December 31, 2025

	Carrying amount	Fair value
		Level 1	Level 2	Level 3	Total
Financial assets
Financial asset measured at amortized cost — Domestic financial bonds	$ 10,000	$ -	$ 10,000	$ -	$ 10,000

December 31, 2024

	Carrying amount	Fair value
		Level 1	Level 2	Level 3	Total
Financial assets
Financial asset measured at amortized cost — Domestic financial bonds	$ 10,000	$ -	$ 10,000	$ -	$ 10,000

For Level 2 fair value measurements, if there are quoted prices available in an active market, the market price is used as the fair value. If no market prices are available for reference, valuation methods are employed to estimate the fair value.

b. Information on fair value - financial instruments measured at fair value on a recurring basis

1) Fair value hierarchy

December 31, 2025

	Level 1	Level 2	Level 3	Total
Financial assets at FVTOCI
Investments in equity instruments
— Domestic listed stock	$11,111,480	$ -	$ -	$11,111,480
— Domestic non-listed (OTC) stock	-	-	46,656	46,656
	$11,111,480	$ -	$46,656	$11,158,136
December 31, 2024
	Level 1	Level 2	Level 3	Total
Financial assets at FVTOCI
Investments in equity instruments
— Domestic listed stock	$7,171,987	$ -	$ -	$7,171,987
— Domestic non-listed (OTC) stock	-	-	30,809	30,809
	$7,171,987	$ -	$30,809	$7,202,796

There was no transfer between Level 1 and Level 2 for the years ended December 31, 2025 and 2024.

2) Reconciliation of Level 3 fair value measurement of financial instruments

January 1 to December 31, 2025

Financial assets	Financial assets at FVTOCI
	Equity instruments
Beginning balance	$ 30,809
Recognized in other comprehensive income (unrealized gains or losses measured at FVTOCI)	15,847
Ending balance	$ 46,656
Unrealized other gains and losses for the current period recognized in profit or loss	$ -

January 1 to December 31, 2024

Financial assets	Financial assets at FVTOCI
	Equity instruments
Beginning balance	$ 30,629
Recognized in other comprehensive income (unrealized gains or losses measured at FVTOCI)	180
Ending balance	$ 30,809
Unrealized other gains and losses for the current period recognized in profit or loss	$ -

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

Domestic unlisted (OTC) company stocks are measured at fair value using the asset-based approach. The significant unobservable inputs applied include a 20%

discount rate for lack of market liquidity and a 20% discount rate for lack of control premium. When other inputs remain unchanged, an increase in either the discount rate for lack of market liquidity or the discount rate for lack of control premium will result in a decrease in the fair value of these investments.

c. Categories of financial instruments

	December 31, 2025	December 31, 2024
Financial assets
financial assets at amortized cost (Note 1)	$ 2,202,676	$ 3,024,532
Financial assets at FVTOCI Investments in equity instruments	11,158,136	7,202,796
Financial liabilities
Measured at amortized cost (Note 2)	14,595,579	13,271,070

Note 1: The balances include cash and cash equivalents, notes receivable, trade receivables, trade receivables from related parties, other receivables, other receivables from related parties, financial assets measured at amortized cost, long-term notes receivable, other financial assets, and refundable deposits (classified as other non-current assets), which are all financial assets measured at amortized cost.

Note 2: The balances included financial liabilities measured at amortized cost, including short-term borrowings, short-term notes payable, accounts payable, other payables, other payables—related parties, current portion of long-term borrowings, long-term borrowings, and guarantee deposits received.

d. Financial risk management objectives and policies

The consolidated company's major financial instruments include investments in equity instruments, trade receivables, trade payables, short-term bills payable and borrowings. The consolidated company's Finance division provides services to each unit of the business, coordinates access to domestic financial markets, and monitors and manages the financial risks relating to the operations of the consolidated company through internal risk reports that analyze exposures by degree and magnitude of risks. These risks include market risk (including interest rate risk and other price risk), credit risk and liquidity risk.

56 -

The consolidated company manages and monitors these exposures to ensure appropriate measures are implemented on a timely and effective manner. Internal auditors review the compliance policies and risk exposure limits on an ongoing basis.

1) Market Risk

As the consolidated company is rarely engaged in foreign currency transactions, exposure to exchange rate risk for fluctuations in market exchange rates is minimal. At this stage, the consolidated company's dedicated unit reviews the assets and liabilities that are affected by exchange rates only on a regular basis.

Therefore, the consolidated company's activities exposed it primarily to the financial risks of changes in interest rates and other price risk.

(a) Interest rate risk

The consolidated company faces interest rate risk due to its individual entities borrowing funds at both fixed and floating rates. To manage this risk, the consolidated company maintains an appropriate combination of fixed and floating interest rates. It regularly assesses interest rate fluctuations and adjusts the affected positions to align with its interest rate outlook and predetermined risk preferences, ensuring the adoption of the most cost-effective hedging strategy.

The carrying amounts of financial assets and financial liabilities of the consolidated company with exposures to interest rate on the balance sheet dates are as follows:

	December 31, 2025	December 31, 2024
Interest rate risk with fair value
— Financial liabilities	$ 5,266,471	$ 4,491,085
Interest rate risk with cash flow
— Financial assets	2,175,187	2,952,885
— Financial liabilities	8,293,509	7,799,415

Sensitivity analysis

The consolidated company used the interest rate risk of non-derivatives financial instruments at the balance sheet date as basis. Facing the risk of changes in floating interest rates of financial assets and in market interest rates of financial liabilities, the consolidated company uses 1% increase or decrease in market interest rates as a reasonable risk assessment for reporting changes in interest rates to the management. If the market interest rate had been 1%

57 -

higher and all other variables were held constant, the consolidated company's income before tax for the years ended December 31, 2025 and 2024 would decrease by NT$61,183 thousand and NT$48,465 thousand, respectively.

(b) Other price risk

The consolidated company was exposed to equity price risk through its investments on equity securities of listed and OTC companies. This equity investment is not held for trading but a strategic investment. The consolidated company does not actively trade these investments. Equity price risk of the consolidated company is mainly concentrated on equity instruments in semiconductor packaging industry of the Taiwan Stock Exchange. Besides, the consolidated company has appointed a dedicated unit to regularly monitor the price risk and assess when it is necessary to increase the risk hedging position.

Sensitivity analysis

If equity prices had been 10% lower, no impact would incur on the Company's pre-tax income for the year ended December 31, 2025 and 2024. The consolidated company's pre-tax other comprehensive income for the years ended December 31, 2025 and 2024 would have decreased by NT$1,115,814 thousand and NT$720,280 thousand, respectively, due to changes in fair value of financial assets at FVTOCI.

2) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial loss to the consolidated company. As of the balance sheet date, the consolidated company's maximum exposure to credit risk due to failure to discharge an obligation by the counterparties arises from the carrying amount of the respective recognized financial assets as stated in the consolidated balance sheet.

The policies adopted by the consolidated company are to trade with reputed counterparties only. If necessary, sufficient collateral must be obtained to reduce the risk of financial losses. The trading counterparties of consolidated company are financial institutions and organizations of company with good credit standing, so no significant credit risk is expected to incur.

To reduce credit risk, the management of the consolidated company has delegated a dedicated team responsible for determining credit limits, credit approvals and

58 -

other monitoring procedures to ensure that follow-up action is properly taken to recover overdue debts. Moreover, the consolidated company reviews the recoverable amount of each individual trade receivables on the balance sheet date to ensure that adequate allowance is made for possible irrecoverable amounts. In this regard, the management believes that the consolidated company's credit risk has been significantly reduced.

The trade receivables target a wide range of customers, primarily located in Taiwan and Mainland China. Due to the consolidated company's transactions with diverse customers, there is no concentration of credit risk. The consolidated company continuously evaluates the financial status of trade receivables customers.

3) Liquidity risk

The ultimate responsibility for liquidity risk management rests with the Board of Directors. The consolidated company has put in place an appropriate liquidity risk management framework to address short, medium and long-term funding and liquidity management needs. The consolidated company manages liquidity risk by maintaining adequate banking facilities and retaining the flexibility to raise funds in the capital markets, monitoring projected and actual cash flows on an ongoing basis and planning for the settlement of liabilities with financial assets of similar maturity.

(a) Table of liquidity risk

The following tables detail the analysis of the consolidated company's remaining contractual maturities for its non-derivative financial liabilities with agreed repayment periods. The tables were drawn up based on the undiscounted cash flows (including principal and estimated interest) of financial liabilities from the earliest date on which the consolidated company may be required to pay.

	December 31, 2025
	Within 6 months	6 months ~ 1 year	Above 1 year	Total
Non-derivative financial liabilities
Short-term borrowings	$ 2,438,775	$ 793,648	$ -	$ 3,232,423
Short-term bills payable	5,278,500	-	-	5,278,500
Trade Payables	195,415	426,640	179,173	801,228
Other payables	142,329	61,591	-	203,920
Other payables - related parties	69	-	-	69
Long-term borrowings	1,855,491	138,574	3,532,598	5,526,663
Guarantee deposits received	50	-	30,332	30,382
	$ 9,910,629	$ 1,420,453	$ 3,742,103	$ 15,073,185

	December 31, 2024
	Within 6 months	6 months ~ 1 year	Above 1 year	Total
Non-derivative financial liabilities
Short-term borrowings	$ 3,270,658	$ 2,528,381	$ -	$ 5,799,039
Short-term bills payable	4,502,500	-	-	4,502,500
Trade Payables	284,093	219,983	243,023	747,099
Other payables	48,836	151,759	1,425	202,020
Other payables - related parties	69	-	-	69
Long-term borrowings	107,564	306,955	2,034,546	2,449,065
Guarantee deposits received	1,200	-	30,182	31,382
	$ 8,214,920	$ 3,207,078	$ 2,309,176	$ 13,731,174

(b) Financing facilities

The bank loans are a significant source of liquidity for the consolidated company. As of December 31, 2025 and 2024, the consolidated company's amount of unused bank financing facilities amounted to NT$4,010,000 thousand and NT$4,119,000 thousand, respectively.

Transactions with Related Parties

In preparing the consolidated financial statements, all transactions, account balances, income and expenses between the Company and its subsidiaries (which are the Company's related parties) have been eliminated in full and are not disclosed in this note accordingly. Aside from what has already been disclosed in other notes, the major transactions between the consolidated company and related parties are as follows.

a. Names and relationships of related parties

Name of related party	Relationship with the Company
Advanced Semiconductor Engineering, Inc. and its subsidiaries	Investor having significant influence
Jason C.S. Chang	Investor having significant influence
Richard H.P. Chang	Investor having significant influence
Ding Gu Properties Co., Ltd.	Affiliates
Wealthy Joy Co., Ltd., Taiwan Branch (British Virgin Islands) (Wealthy Joy)	Substantial related party
ASE Test, Inc.	Substantial related party
Baiji Investment Co., Ltd.	Substantial related party
Wanyu Investment Co., Ltd.	Substantial related party
ASE Environmental Protection and Sustainability Foundation	Substantial related party

b. Operating revenue

Item	Category and name of related party	2025	2024
Sales revenue of building and land	Investor having significant influence
	Advanced Semiconductor Engineering, Inc.	$ -	$ 5,263,000
Rental revenue	Investor having significant influence
	Advanced Semiconductor Engineering, Inc.	$ 11,217	$ 9,771
	Affiliates
	Ding Gu Properties Co., Ltd.	34	34
	Substantial related party
	Wealthy Joy	1,371	1,371
	Baiji	34	34
	Investment Co., Ltd.
	Wanyu	34	34
	Investment Co., Ltd.
		$ 12,690	$ 11,244
Construction revenue	Investor having significant influence
	Advanced Semiconductor Engineering, Inc.	$ 8,438	$ -
Service revenue	Investor having significant influence
	Advanced Semiconductor Engineering, Inc. and its subsidiaries	$ 58,154	$ 88,289

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The consolidated company and its subsidiaries' transaction terms for related parties are comparable with those for third parties.

The consolidated company has entered into certain lease agreements with investors and associates having significant influence, and the rentals are received monthly or annually with rent terms expired one after another before December 31, 2025.

c. Receivables/Payables from related parties

Item	Category and name of related party	December 31, 2025	December 31, 2024
Trade receivables from related parties	Investor having significant influence
	Advanced Semiconductor Engineering, Inc. and its subsidiaries	$ 5,147	$ 6,458
Other receivables	Investor having significant influence
— Related parties	Advanced Semiconductor Engineering, Inc. Jason C.S. Chang	$ -	$ 35,981
	Substantial related party	43	12
		$ 43	$ 36,143
Other payables	Investor having significant influence
— Related parties	Advanced Semiconductor Engineering, Inc. Jason C.S. Chang	$ 9	$ 9
		60	60
		$ 69	$ 69

The consolidated company and its subsidiaries' transaction terms for related parties are comparable with those for third parties.

Outstanding receivables from related parties are not guaranteed. As of December 31, 2025 and December 31, 2024, no allowance for doubtful accounts has been made for these receivables.

d. Loans to related parties (recorded as other receivables - related parties)

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	December 31, 2025	December 31, 2024
Affiliated enterprise / Ding Gu Properties Co., Ltd.
Principal	$ 800,000	$ 1,618,800
Accrued interest receivable	-	-
	$ 800,000	$ 1,618,800
Interest income
Category and name of related party	2025	2024
Affiliated enterprise / Ding Gu Properties Co., Ltd.	$ 36,938	$ 38,339

In November 2025 and 2024, the Group, with approval from the board of directors, provided short-term financing to Ding Gu Properties Co., Ltd. at an interest rate comparable to market rates. These loans are expected to be fully recovered within one year, and after evaluation, no expected credit losses have been identified.

e. Borrowings from related parties (recorded as other payables - related parties)

Interest expenses

Category and name of related party	2025	2024
Substantive related party / ASE Test, Inc.	$ -	$ 29,960

In January 2024, the consolidated company borrowed NT$1,500,000 thousand from ASE Test, Inc. as short-term working capital. The borrowing interest rate was comparable to market rates, and the loan was fully repaid in October 2024.

f. Endorsements/guarantees

Real estate of subsidiary is provided for the amount of the consolidated company's endorsements/guarantees. Please refer to Appendix 2.

g. Compensation of key management personnel

	2025	2024
Short-term employee benefits expense	$ 91,116	$ 79,484
Post-Retirement Benefits	1,123	1,096
	$ 92,239	$ 80,580

The remuneration of directors and other members of key management personnel, as determined by the remuneration committee, was based on the individual performance and market trends.

h. In 2025 and 2024, significant investors provided real estate and securities as collateral for the Company's issuance of short-term loans and commercial papers.

i. In June 2020, the Company signed a cooperative development agreement with Advanced Semiconductor Engineering, Inc. based on the principles of joint construction. It was agreed that the Company would lease land and independently construct a factory building. Upon completion, Advanced Semiconductor Engineering, Inc. and its affiliated enterprises would have the priority to purchase the building. In June 2024, the Board of Directors, and subsequently the extraordinary shareholders' meeting in September 2024, approved the sale of the factory building. The sale price and profit/loss amounted to NT$5,263,000 thousand and NT$701,886 thousand, respectively, and the transfer was completed in October 2024.

j. The Company and ASE Technology Holding Co., Ltd. entered into an agreement in April 2022 to jointly construct a factory building under a joint construction and unit allocation arrangement, whereby the Company and ASE Technology Holding Co., Ltd. respectively provide funding and factory land. Upon completion of the construction, ASE Technology Holding Co., Ltd. shall have a right of first refusal to acquire the ownership interests allocated to the Company based on the agreed allocation ratio. In September 2025, the parties executed a supplemental agreement to revise the allocation ratio under the joint construction arrangement. In January 2026, the Company's extraordinary shareholders' meeting approved the sale of the factory building. The disposal proceeds and gain on disposal amounted to NT$4,231,000 thousand and NT$833,630 thousand, respectively, and the transfer of ownership was completed in March 2026.

k. The Company and Advanced Semiconductor Engineering, Inc. signed a jointly-constructed with house divided contract in June 2024. It is agreed that the Company and Advanced Semiconductor Engineering, Inc. shall provide funds and part of the plant land respectively, and jointly build the plant in the mode of jointly-constructed with house divided. After the completion of the construction of the plant, Advanced Semiconductor Engineering, Inc. and its subsidiaries have the right of first refusal to purchase the property rights acquired by the Company in accordance with the jointly-construction distribution ratio.

l. To address concerns regarding net-zero carbon emissions and the mitigation of climate change impacts, the Company's Board of Directors resolved to donate NT$200 thousand

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to the ASE Environmental Protection and Sustainability Foundation in November 2025 and 2024 to support the implementation of the Foundation's work plan.

m. In March 2025, the Company entered into a joint development, construction, and sales agreement with Wealthy Joy Co., Ltd., Taiwan Branch (British Virgin Islands) (“Wealthy Joy”) for land parcels Lot 247 and 248, Zhouji Section, Beitun District, Taichung City. Under the agreement, both parties shall contribute construction funding and bear related costs based on their respective landholding proportions (50% each) to jointly complete the development. In the same month, the Company’s subsidiary, Fuhua Engineering Co., Ltd., also entered into a construction contract with Wealthy Joy for the aforementioned project.

n. On August 8, 2025, the Company’s Board of Directors resolved to participate in the cash capital increase of Ding Gu Properties Co., Ltd. The Company subscribed for 57,120 thousand shares at NT$10 per share in proportion to its existing shareholding, and offset the subscription payment with part of its receivables from Ding Gu Properties amounting to NT$571,200 thousand. The capital increase record date was set on September 30, 2025, and the registration of the capital increase was completed on December 24, 2025.

o. On September 25, 2025, the Board of Directors of the Company’s subsidiary, Fuhua Engineering Co., Ltd., resolved to undertake the construction of a new factory building for ASE Technology Holding Co., Ltd., with a contract value of NT$4,208,400 thousand.

p. In January 2026, the Company’s extraordinary shareholders’ meeting approved the execution of a joint construction and unit allocation agreement with ASE Technology Holding Co., Ltd.. Under the agreement, the Company and ASE Technology Holding Co., Ltd. shall respectively provide funding and lease the factory land to jointly construct the factory building under a joint construction arrangement. The agreed allocation of rights and interests in the joint development is 97% for the Company and 3% for ASE Technology Holding Co., Ltd.

28. Pledged Assets

The following assets of the consolidated company, listed by net carrying amount, were provided to banks as collateral for short-term borrowings, short-term bills payable, long-term borrowings - current portion, and long-term borrowings.

65 -

	December 31, 2025	December 31, 2024
Inventories	$ 8,249,801	$ 6,105,122
Financial Assets Measured at Fair Value through Other Comprehensive Income - Non-current	10,899,255	7,048,620
Property, Plant and Equipment	810,020	822,564
Investment Properties	2,862,358	2,943,191
Prepayments	525,716	525,716

29. Significant Events after the Balance Sheet Date

On January 14, 2026, the Company’s extraordinary shareholders’ meeting approved the sale of the factory building and the execution of a joint construction and unit allocation agreement. Please refer to Note 27 for further details.

30. Supplementary Disclosures

a. Information on Significant Transactions:

1) Financing provided to others: Appendix 1.
2) Endorsements/guarantees provided for others: Appendix 2.
3) Material marketable securities held at year end (excluding investment in subsidiaries, associates and joint ventures): Appendix 3.
4) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% or greater of the paid-in capital: Appendix 4.
5) Receivables from related parties amounting to at least NT$100 million or 20% or greater of the paid-in capital: Appendix 5.
6) Business relationships, situations, and amounts of significant inter-company transactions: Appendix 6.

b. Information on Invested Companies: Appendix 7.

c. Information on Investments in Mainland China

1) Information on any investee in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, shareholding percentage, net income of investee, investment gain (loss) recognized in the current period, carrying amount of the investment at the end of the period, repatriations of investment income, and limit on the amount of investment in the mainland China area: Appendix 8.
2) Significant transactions directly or indirectly through third region with investee companies in mainland China, and their prices, terms of payment, unrealized gain or loss: None.

(a) Purchase amount and percentage, and the ending balance and percentage of the related payables: None.
(b) Sales amount and percentage, and the ending balance and percentage of the related receivables: None.
(c) Property transaction amounts and the resulting gain or loss: None.
(d) Ending balances and the purposes of endorsements/guarantees or collateral provided: None.
(e) The maximum remaining balance, ending balance, range of interest rate and total amount of current interest of financing facilities: None.
(f) Other transactions having a significant impact on profit or loss or financial position for the period, such as provision or receipt of service: None.

31. Segment Information

Information reported to the chief operating decision maker for the purposes of resource allocation and assessment of segment performance, and the reportable segments of the consolidated company are as follows:

Real estate development - sales of residential and commercial property and plant

Construction - building of residential and commercial property and plant

Lease - lease of investment property

Others - property management and related services for investment properties

a. Segment revenue and operation results

	Development of real estate	Construction	Lease	Others	Total
2025
Revenue from external clients	$ 314,786	$ 8,438	$ 193,438	$ 142,219	$ 658,881
Intersegment revenue	-	1,741,354	2,269	37,567	1,781,190
Segment revenue	$ 314,786	$ 1,749,792	$ 195,707	$ 179,786	2,440,071
Intercompany elimination					( 1,781,190 )
Consolidated revenue					658,881
Segment income	$ 236,343	$ 675	$ 55,300	$ 26,447	318,765
Operating Expenses					( 301,080 )
NON-OPERATING INCOME AND EXPENSES
Net income before tax from continuing operations					282,222
					$ 299,907

(Continued on the next page)

(Continued from the previous page)

	Development of real estate	Construction	Lease	Others	Total
2024
Revenue from external clients	$ 6,922,512	$ -	$ 180,722	$ 162,035	$ 7,265,269
Intersegment revenue	-	2,448,560	2,188	40,911	2,491,659
Segment revenue	$ 6,922,512	$ 2,448,560	$ 182,910	$ 202,946	9,756,928
Intercompany elimination					( 2,491,659 )
Consolidated revenue					7,265,269
Segment income	$ 1,710,490	$ -	$ 55,678	$ 30,281	1,796,449
Operating Expenses					( 434,328 )
NON-OPERATING INCOME AND EXPENSES
Net income before tax from continuing operations					96,597
					$ 1,458,718

The transaction conditions of intersegment revenue are decided by the two parties through negotiation.

Segment profit represents the profits made by each segment, excluding the general and administrative costs of headquarters and remuneration of directors that shall be amortized, share of profit of associates accounted for using equity method, dividend revenue, interest income, foreign exchange gain (loss), gain (loss) on valuation of financial products, finance costs, and income tax expenses. This measure is provided to the chief operating decision-maker for the allocation of resources to segments and the assessment of their performance.

b. Major products and service revenue

An analysis of the consolidated company's main product and service revenue from continuing operations is as follows:

	2025	2024
Development of real estate	$ 314,786	$ 6,922,512
Construction	8,438	-
Lease	193,438	180,722
Others	142,219	162,035
	$ 658,881	$ 7,265,269

c. Information on classification by area

The consolidated company mainly operates in two geographical areas, Taiwan and China.

Information on the consolidated company's revenues of continuing operations from external clients classified by the location of the business operation and the non-current assets classified by location of the asset are as follows:

	Revenue from external clients		Non-current assets
	2025	2024	December 31, 2025	December 31, 2024
Taiwan	$ 600,662	$ 7,176,556	$ 4,449,744	$ 4,427,266
China	58,219	88,713	5,761	6,276
	$ 658,881	$ 7,265,269	$ 4,455,505	$ 4,433,542

Non-current assets exclude financial assets classified as measured at fair value through other comprehensive income - non-current, financial assets measured at amortized cost - non-current, investments accounted for using the equity method, and deferred tax assets.

d. List of major clients

Among the sales revenue of building and land amounted to NT$314,786 thousand and NT$6,922,512 thousand for the years ended December 31, 2025 and 2024, respectively, NT$0 thousand and NT$5,263,000 thousand were derived from the Group's largest customer, respectively.

69 -

Hung Ching Development & Construction Co., Ltd. and Subsidiaries
Financing provided to others
January 1 to December 31, 2025
Appendix 1
Unit: NT$ thousand

Code	Company Lending Funds	Loan Recipient	Financial Statement Account	Maximum Balance for the Period (Note 1)	Ending balance (Note 2)	Actual Amount Used	Interest Rate Range %	Nature of financing	Transaction Amounts	Reasons for Short-term Financing	Allowance for Bad Debts	Collateral		Financing Limits for Each Borrower (Note 3)	Capital Loan and Maximum Limit (Note 4)
												Name	Value
1	Hung Ching Development & Construction Co., Ltd.	Ding Gu Properties Co., Ltd.	Other receivables - related party	$ 1,618,800	$ 800,000	$ 800,000	2.45%-2.72%	Short-term financing	$ -	Operating requirements	$ -	None	$ -	$ 3,430,120	$ 6,860,240

Note 1: The maximum balance of financing provided to others for the fiscal year.
Note 2: If a public company submits a board of directors' resolution for a loan of funds pursuant to Article 14, Paragraph 1 of the Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies, even though the funds have not yet been appropriated, the amount of the board of directors' resolution should be included in the announcement of the balance of the loan in order to disclose the risk it has assumed. However, if the funds are repaid later, the balance of the loan after the repayment of the funds should be disclosed in order to reflect the adjustment of the risk. If a public company's board of directors resolves to authorize the chairman of the board of directors to make loans or revolving loans within a certain amount and a period of one year in accordance with Article 14, Paragraph 2 of the Regulations, the remaining balance of the announcement should still be reported as the amount of funds loaned as approved by the board of directors, and even though the funds are repaid subsequently, the amount of funds loaned should be reported as the remaining balance of the announcement in consideration of the possibility of loaning the funds again.
Note 3: Lending limits to individual companies or firms: Loans for short-term financing needs shall not exceed twenty percent of the Company's latest financial statement net worth.
Note 4: Where an inter-company or inter-firm short-term financing facility is necessary, provided that such financing amount shall not exceed 40 percent of the lender's net worth.

70 -

Hung Ching Development & Construction Co., Ltd. and Subsidiaries

Endorsements/Guarantees Provided for Others

January 1 to December 31, 2025

Appendix 2
Unit: NT$ thousand

Code	Company Name of Endorsements/Guarantees Provider	Parties Being Endorsed/Guaranteed		Limits on Endorsement/ Guarantee Provided for a Single Entity (Note 1)	Maximum Amount Endorsed/ Guaranteed in the Current Period	Outstanding Balance of Endorsement/ Guarantee - Ending	Actual Amount Used	Amount of Endorsed/ Guaranteed Secured with Collateral (Note 2)	Ratio of Accumulated Endorsement/ Guarantee to Net Equity in Latest Financial Statements (%)	Maximum Limit on Endorsement/ Guarantee Limit (Note 1)	Endorsement/ Guarantee Provided by Parent on Behalf of Subsidiaries	Endorsement/ Guarantee Provided by Subsidiaries on Behalf of Parent	Endorsement/ Guarantee Provided on Behalf of Companies in Mainland China
		Company Name	Relationship
1	Hung Ching Kuan Co., Ltd.	The Company	Subsidiary of the Company	$ 1,470,810	$ 1,000,000	$ 1,000,000	$ 600,000	$ 1,000,000	135.98%	$ 1,470,810	N	Y	N

Note 1: It was calculated based on 200% of the net value of shareholders' equity of Hung Ching Kuan's financial statements audited by the certified public accountant as of December 31, 2025.
Note 2: Real estate provided by Hung Ching Kuan as collateral.

Hung Ching Development & Construction Co., Ltd. and Subsidiaries
Material marketable securities held at the end of the period
December 31, 2025

Appendix 3
Unit: In Thousands of New Taiwan Dollars or Foreign Currency

Name of Holding Company	Type and Name of Marketable Security	Relationship with the Issuer of Marketable Security	Account Title	Year End				Note
				Shares (In Thousand Shares) / Number of Shares / Unit	Carrying amount	Shareholding Percentage %	Fair value
The Company	Stock
ASE Industrial Holding Co., Ltd.	Major shareholder of the Company	Financial assets at FVTOCI - non-current, net	44,131	$ 11,054,753	0.99	$ 11,054,753	Notes 1 and 2
Hung Ching New Co., Ltd.	Stock
Hung Ching Development & Construction Co., Ltd.	Parent company	Financial assets at FVTOCI - non-current, net	8,548	248,311	3.16	248,311	Note 2
Luchu Development Corporation	Bond
Shin Kong Commercial Bank Co., Ltd., 2024 First Issue
Unsecured Subordinated Financial Bonds, Class A Bonds, G11663	—	Financial asset measured at amortized cost - non-current	-	10,000	-	10,000	—
	Stock
	Powerchip Semiconductor Manufacturing Corporation	—	Financial assets at FVTOCI - non-current, net	1,434	56,727	0.03	56,727	Note 2
	Powerchip Investment Holding Corporation	—	Financial assets at FVTOCI - non-current, net	1,016	46,656	0.07	46,656	Note 3

Note 1: Of which 43,510 thousand shares (net carrying amount of NT$10,899,255 thousand) were provided to financial institutions as financial guarantees.
Note 2: Market price was calculated based on the closing price as of December 31, 2025.
Note 3: Fair value measurement is measured on the asset-based approach.

Hung Ching Development & Construction Co., Ltd. and Subsidiaries
Total purchases from or sales to related parties amounting to at least NT$100 million or 20% or greater of the paid-in capital
January 1 to December 31, 2025
Appendix 4
Unit: NT$ thousand

Buyer/Seller	Counterparty	Relationship	Transaction Details				Terms and Reasons of Abnormal Transaction		Notes/Trade Receivable (Payable)		Note
			Purchase/Sales	Amount	% to Total Purchases or Sales	Payment Terms	Unit Price	Payment Terms	Balance	% to Total Notes/Trade Receivable (Payable)
The Company	Fuhua engineering Co., Ltd.	Subsidiaries	Purchase	$ 2,077,641	93.99%	In comply with the terms of contracts	$ -	—	($ 1,558,596)	93.90%	Notes 1 and 2
Fuhua engineering Co., Ltd.	The Company	Parent company	Sales	( 1,741,354 )	( 99.46%)	In comply with the terms of contracts	-	—	1,558,596	100.00%	Notes 1 and 2

Note 1: Payment for construction.
Note 2: The difference between the purchases and sales of Fuhua engineering and the Company was due to the recognition of related revenue and cost by Fuhua engineering under the percentage of completion method.
Note 3: Wholly eliminated when preparing consolidated financial statements.

73 -

Hung Ching Development & Construction Co., Ltd. and Subsidiaries
Receivables from related parties amounting to at least NT$100 million or 20% or greater of the paid-in capital
December 31, 2025

Appendix 5
Unit: NT$ thousand

Company Recording Receivables	Counterparty	Relationship	Balance of Receivables from Related Parties	Turnover Rate	Overdue Balance of Receivables from Related Parties		Amount Received of Receivables from Related Parties after the Balance Sheet Date	Allowance for Bad Debts
					Amount	Action Taken
Fuhua engineering Co., Ltd.	The Company	Parent company	$ 1,558,596	Note 1	$ -	—	$ 330,750	$ -

Note 1: In comply with the collection term of the contract. Not applicable.
Note 2: Wholly eliminated when preparing consolidated financial statements.

74 -

Hung Ching Development & Construction Co., Ltd. and Subsidiaries
Business Relationships, Situations, and Amounts of Significant Inter-company Transactions
January 1 to December 31, 2025
Appendix 6
Unit: NT$ thousand

| Code
(Note 1) | Name of Trader | Counterparty of Trade | Relationship with the
Counterparty
(Note 2) | Transaction Details (Notes 3 and 5) | | | |
| --- | --- | --- | --- | --- | --- | --- | --- |
| | | | | Account | Amount | Terms and
Conditions | Percentage of total
consolidated revenue
or total consolidated
assets (%) |
| 0 | Hung Ching Development & Construction Co., Ltd. | Fuhua engineering Co., Ltd. | 1 | Trade payables to related parties | $ 1,558,596 | Note 4 | 4.73 |
| 0 | Hung Ching Development & Construction Co., Ltd. | ASE WeMall M&C Co. | 1 | Operating Expenses | 27,257 | Note 4 | 4.14 |
| 1 | Fuhua engineering Co., Ltd. | Hung Ching Development & Construction Co., Ltd. | 2 | Trade receivables from related parties | 1,558,596 | Note 4 | 4.73 |
| 1 | Fuhua engineering Co., Ltd. | Hung Ching Development & Construction Co., Ltd. | 2 | Construction revenue | 1,741,354 | Note 4 | 264.29 |
| 1 | Fuhua engineering Co., Ltd. | Hung Ching Development & Construction Co., Ltd. | 2 | Construction costs | 1,561,578 | Note 4 | 237.00 |
| 1 | Fuhua engineering Co., Ltd. | Hung Ching Development & Construction Co., Ltd. | 2 | Inventories | 179,776 | Note 4 | 0.55 |
| 2 | ASE WeMall M&C Co. | Hung Ching Development & Construction Co., Ltd. | 2 | Service revenue | 27,257 | Note 4 | 4.14 |
| 3 | Shanghai You Chang Property Management Co., Ltd. | Shanghai Youhong Engineering Technical Consulting Co., Ltd. | 3 | Service costs | 7,358 | Note 4 | 1.12 |
| 4 | Shanghai Youhong Engineering Technical Consulting Co., Ltd. | Shanghai You Chang Property Management Co., Ltd. | 3 | Service revenue | 7,670 | Note 4 | 1.16 |

Note 1: Information on business transactions between the parent and subsidiaries shall be indicated in the code column as follows:
1. Parent company is "0."
2. The subsidiaries are numbered in order starting from "1."

Note 2: Trader's relationship with the following three categories (just mark the category number):
1. The parent to subsidiary.
2. Subsidiary to the parent.
3. Between subsidiaries.

Note 3: On whether to calculate the percentage of transaction amount to the consolidated total revenue or total assets, the percentage of transaction amount to the year-end balance of the consolidated total assets shall be calculated if a transaction belongs to the assets and liabilities account, whereas the percentage of accumulated transaction amount for the year to the consolidated total revenue shall be calculated if a transaction belongs to the profit and loss account.

Note 4: The Company and its subsidiaries' transaction terms for related parties are comparable with those for third parties.

Note 5: Transaction amounted to more than $5,000 thousand.

75 -

Hung Ching Development & Construction Co., Ltd. and Subsidiaries

Information on Investee Companies, Location, .. etc.

January 1 to December 31, 2025

Appendix 7

Unit: In Thousands of New Taiwan Dollars or Foreign Currency

Name of Investor Company	Name of Investee Company	Location	Main Businesses	Initial Investment Amount		Held at year end			Investee Company's Income in the Current Period	Investment gain (loss) recognized in the current period (Note 1)	Note
				End of the Current Period	End of the Previous Period	Number of Shares (In Thousand Shares)	Ratio %	Carrying amount
The Company	Hung Ching Kuan Co., Ltd.	Taipei City	Leasing of mall and office building	$ 907,441	$ 907,441	82,495	63.46	$ 466,689	($ 59,365)	($ 37,673)
	Fuhua engineering Co., Ltd.	Taipei City	Contractor of construction projects	539,077	539,077	65,000	100.00	468,401	169,742	( 3,996)	Note 2
	Hung Ching New Co., Ltd.	Taipei City	Retailer of household equipment and supplies	179,996	179,996	46,300	100.00	59,575	14,077	( 3,018)	Note 3
	ASE WeMall M&C Co.	Taipei City	Management consulting business	5,000	5,000	500	100.00	4,042	660	660
	Hung Ching Co., Limited	Hong Kong	General investment	9,912	9,912	1,099	100.00	72,960	( 2,638)	( 2,638)
	Superb First Co., Ltd.	Seychelles	General investment	18,285	18,285	600	100.00	82,381	8,525	8,525
	Luchu Development Corporation	Taipei City	Real estate development	2,649,560	2,649,560	208,853	96.54	2,683,146	448	432
	Ding Gu Properties Co., Ltd.	Taipei City	Management consulting business	1,142,400	571,200	114,240	24.00	1,426,093	707,915	169,900

Note 1: It was calculated based on the financial statements of investees company audited by the certified public accountant for the same period.
Note 2: The investment gains recognized in the current period included unrealized gains of $179,776 thousand and realized gains of $6,038 thousand of upstream transactions.
Note 3: The investment gains and losses recognized in the current period include the Company's cash dividends received by subsidiary amounted to NT$17,095 thousand.
Note 4: Please refer to Appendix 8 for information on investments in Mainland China
Note 5: Wholly eliminated when preparing consolidated financial statements.

Hung Ching Development & Construction Co., Ltd. and Subsidiaries

Information on Investments in Mainland China

January 1 to December 31, 2025

Appendix 8
Unit: In Thousands of New Taiwan Dollars or Foreign Currency, Unless Otherwise Specified

Investee Companies in Mainland	Main Businesses	Paid-in Capital	Method of Investment	Accumulated Outward Remittance for Investment from Taiwan - Beginning of the Period	Outward/Inward Remittance of Funds in the Current Period		Accumulated Outward Remittance for Investment from Taiwan - End of the Period	Investee Company's Income in the Current Period	Shareholding Percentage of Direct or Indirect Investment	Investment Gain (Loss) Recognized in the Current Period (Note 4)	Carrying Amount of Investment - End of the Period	Accumulated Repatriation of Investment Income by the End of the Current Period
					Outward	Inward
Shanghai Youhong Engineering Technical Consulting Co., Ltd.	Technical consulting services of electronic engineering and architectural engineering	$ 9,912	Note 1	$ 9,912	$ -	$ -	$ 9,912	($ 2,638)	100.0%	($ 2,638)	$ 72,960	$ -
Shanghai Hong Rong Property Management Co., Ltd.	Consulting services of property management and construction and technical consulting services of architectural engineering	2,438	Note 2	-	-	-	-	1,707	100.0%	1,707	29,565	-
Shanghai You Chang Property Management Co., Ltd.	Consulting services of property management and construction and technical consulting services of architectural engineering	18,285	Note 3	18,285	-	-	18,285	8,525	100.0%	8,525	82,381	-
Accumulated Outward Remittance for Investment from Taiwan to Mainland China - End of the Period	Investment Amounts Authorized by the Investment Commission, MOEA	Upper Limit on Investment on the Company's Investments in Mainland China
---	---	---
$ 72,886
(USD 2,319)	$ 74,458
(USD 2,369)	$10,509,289 (Note 5)

Note 1: Shanghai Youhong Engineering Technical Consulting Co., Ltd. was invested through the investee company, Hung Ching Co., Ltd.
Note 2: It was invested by Shanghai Youhong Engineering Technical Consulting Co., Ltd. with its own capital, and the Company did not remit the funds separately.
Note 3: Shanghai You Chang Property Management Co., Ltd. was invested through the investee company, Superb First Co., Ltd.
Note 4: Investment income in the current period was calculated based on the financial statements audited by the certified public accountant for the same period.
Note 5: In accordance with the "Principles for Review of Investment or Technical Cooperation in the Mainland China" of the Investment Commission, it regulates the higher of 60% of the Company's net value or consolidated net value.
Note 6: Wholly eliminated when preparing consolidated financial statements.

AI assistant

Hung Ching Audit Report / Information 2025

52140_rns_2026-05-11_e0410ee3-e3f0-4c18-ab92-c3aba2e4d2be.pdf

Hung Ching Development & Construction Co., Ltd. and Subsidiaries

Consolidated Financial Statements and Independent Auditors' Report

Declaration of Consolidated Financial Statements of Affiliates

Auditors' Responsibilities for the Audit of the Consolidated Financial Statements

4. Summary of Significant Accounting Policies

6. Cash and Cash Equivalents

7. Notes Receivable, Trade Receivables, Trade Receivables – Related Parties, Other Receivables, and Other Receivables – Related Parties

8. Inventories

9. Financial Assets Measured at Fair Value through Other Comprehensive Income - Non-current

10. Subsidiaries

11. Investments Accounted for Using Equity Method

12. Property, Plant and Equipment

13. Lease Arrangements

14. Investment Properties

15. Other Financial Assets - Current

16. Prepayments

17. Borrowings

19. Post-retirement Benefit Plans

20. Equity

22. Net Income from Continuing Operation

23. Income Tax from Continuing Operations

24. Earnings per Share

25. Management of Risks in Capital

26. Financial Instruments

28. Pledged Assets

29. Significant Events after the Balance Sheet Date

30. Supplementary Disclosures

31. Segment Information

AI assistant

Hung Ching — Audit Report / Information 2025

52140_rns_2026-05-11_e0410ee3-e3f0-4c18-ab92-c3aba2e4d2be.pdf

Hung Ching Development & Construction Co., Ltd. and Subsidiaries

Consolidated Financial Statements and Independent Auditors' Report

Declaration of Consolidated Financial Statements of Affiliates

Auditors' Responsibilities for the Audit of the Consolidated Financial Statements

4. Summary of Significant Accounting Policies

6. Cash and Cash Equivalents

7. Notes Receivable, Trade Receivables, Trade Receivables – Related Parties, Other Receivables, and Other Receivables – Related Parties

8. Inventories

9. Financial Assets Measured at Fair Value through Other Comprehensive Income - Non-current

10. Subsidiaries

11. Investments Accounted for Using Equity Method

12. Property, Plant and Equipment

13. Lease Arrangements

14. Investment Properties

15. Other Financial Assets - Current

16. Prepayments

17. Borrowings

19. Post-retirement Benefit Plans

20. Equity

22. Net Income from Continuing Operation

23. Income Tax from Continuing Operations

24. Earnings per Share

25. Management of Risks in Capital

26. Financial Instruments

28. Pledged Assets

29. Significant Events after the Balance Sheet Date

30. Supplementary Disclosures

31. Segment Information

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Hung Ching Audit Report / Information 2025