Stock Code: 3533

Lotes Co., Ltd.

Parent Company Only Financial Statements With Independent Auditors' Report For the Years Ended December 31, 2025 and 2024

Address: No. 15, Wuxun St., Anle Dist., Keelung City 204
Telephone: (02) 2433 1110

The independent auditors' report and the accompanying parent company only 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 parent company only financial statements, the Chinese version shall prevail.

Table of Contents

Contents	Page
I. Cover Page	1
II. Table of Contents	2
III. Independent Auditors’ Report	3
IV. Balance Sheets	7
V. Statements of Comprehensive Income	8
VI. Statements of Changes in Equity	9
VII. Statements of Cash Flows	10~11
VIII. Notes to the Financial Statements
(I) Company History	12
(II) Approval Date and Procedures of the Financial Statements	12
(III) Application of New and Revised Standards and Interpretations	12~14
(IV) Summary of Major Accounting Policies	14~31
(V) Primary Sources of Major Accounting Judgment, Estimate and Assumption Uncertainties	31~32
(VI) Descriptions for Important Accounting Items	32~63
(VII) Related Party Transactions	63~67
(VIII) Pledged Assets	68
(IX) Significant Contingent Liabilities and Unrecognized Contractual Commitments	68
(X) Significant Disaster Loss	68
(XI) Significant Post-Period Events	68
(XII) Others	69
(XIII) Disclosing Information
(1) Information on Significant Transactions	70~74
(2) Information on Investees	75
(3) Information on Investment in China	76~77
(XIV) Segment Information	77
IX. Statements of Major Accounting Items	78~92

Independent Auditors' Report

The Board of Directors and Shareholders
Lotes Co., Ltd.

Opinion

We have audited the accompanying Parent Company Only Financial Statements of Lotes Co., Ltd. (the "Company"), which comprise the parent company only balance sheets as of December 31, 2025 and 2024, and the parent company only statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the Parent Company Only Financial Statements, including material accounting policy information.

In our opinion, the accompanying Parent Company Only Financial Statements present fairly, in all material respects, the parent company only financial position of the Company as of December 31, 2025 and 2024, and its parent company only financial performance and its parent company only cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Financial Statement Audit and Attestation Engagements of Certified Public Accountants and the Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Parent Company Only Financial Statements section of our report. We are independent of the Company 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 Parent Company Only Financial Statements for the year ended December 31, 2025. These matters were addressed in the context of our audit of the Parent Company Only Financial Statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. The key audit matters that, in our judgment, should be communicated in the audit report are as follows:

Revenue Recognition

For the accounting policies on revenue recognition, please refer to Note IV (16) to the Parent Company Only Financial Statements; for the description of refund liabilities, please refer to Note VI (13); and for the disclosure of revenue, please refer to Note VI (21).

Description of Key Audit Matter:

Operating revenue is the most critical factor in determining the operating performance of the Company of significant concern to users of the financial statements. In addition, certain sales transactions involve sales discounts granted to customers in response to market conditions and business needs. Management estimates refund liabilities based on agreements with customers and records them as a deduction from operating revenue. Accordingly, testing of revenue recognition is one of the key areas of focus in our audit of the Company’s financial statements.

Audit Procedures Performed:

Our principal audit procedures included understanding and testing the design and operating effectiveness of internal controls related to sales transactions; performing cut-off testing by sampling sales transactions occurring near the balance sheet date and examining supporting external documentation to assess the appropriateness of the timing of revenue recognition; obtaining management’s methodology for estimating refund liabilities and evaluating whether such estimates are based on contractual terms with customers; and assessing the reasonableness of refund liability estimates by comparing them with subsequent actual results.

Inventory Valuation

For the accounting policies on inventory valuation, please refer to Note IV (7) to the Parent Company Only Financial Statements; for the uncertainty in accounting estimates and assumptions related to inventory valuation, please refer to Note V; and for information on inventory write-downs, please refer to Note VI (4).

Description of Key Audit Matter:

Due to rapid changes in market demand and advancements in production technology, existing products may face risks of obsolescence or reduced market demand. Certain inventories may become slow-moving or subject to declines in market prices. Therefore, testing of inventory valuation is one of the key areas of focus in our audit of the Company’s financial statements.

Audit Procedures Performed:

Our principal audit procedures included understanding the basis and methodology used by management in assessing the net realizable value of inventories; reviewing and recalculating the data used by management in its assessment, including testing estimated selling prices against the most recent sales records; examining the accuracy of inventory aging reports; and analyzing changes in inventory aging over different periods to evaluate the appropriateness of inventory write-downs.

Responsibilities of Management and Those Charged with Governance for the Parent Company Only Financial Statements

Management is responsible for the preparation and fair presentation of the Parent Company Only Financial Statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and for such internal control as management determines is necessary to enable the preparation of Parent Company Only Financial Statements that are free from material misstatement, whether due to fraud or error.

In preparing the Parent Company Only Financial Statements, management is responsible for assessing the Company’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 Company 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 Company’s financial reporting process.

Auditors' Responsibilities for the Audit of the Parent Company Only Financial Statements

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

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

Identify and assess the risks of material misstatement of the Parent Company Only 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 Company'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 Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the Parent Company Only Financial Statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the Parent Company Only Financial Statements, including the disclosures, and whether the Parent Company Only Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of investees accounted for using the equity method to express an opinion on the Parent Company Only Financial Statements. We are responsible for the direction, supervision and performance of the audit. We remain solely responsible for our audit opinion.

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

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

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

The engagement partners on the audit resulting in this independent auditors’ report are Lee, Feng-Hui and Hsiao, Ya-Wen.

KPMG
Taipei, Taiwan (Republic of China)
March 11, 2026

Notice to Readers

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

For the convenience of readers, the independent auditors' audit report and the accompanying Parent Company Only Financial Statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors' audit report and Parent Company Only Financial Statements shall prevail.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)

Lotes Co., Ltd.

Balance Sheets

December 31, 2025 and 2024

Unit: NT$ thousands

Assets	Dec. 31, 2025		Dec. 31, 2024			Liabilities and equity		Dec. 31, 2025		Dec. 31, 2024
		Amount	%	Amount	%		Amount	%	Amount	%
Current assets:							Current liabilities:
1100	Cash and cash equivalents (Note VI (1) and (24))	$ 4,228,167	9	11,074,514	23	2100	Short-term loans (Note VI (10), (24), (27) VIII and IX)		$ -	-	3,730,000	8
1110	Current financial assets at fair value through profit or loss (Note VI (2) and (24))	831,264	2	-	-	2130	Current contract liabilities (Note VI (21))		573	-	1,810	-
1150	Notes receivable, net (Note VI (3) and (24))	2,116	-	1,615	-	2150	Notes payable (Note VI (24))		8,133	-	6,761	-
1170	Accounts receivables, net (Note VI (3) and (24))	7,858,650	17	7,755,548	16	2170	Accounts payable (Note VI (24))		1,938	-	1,777	-
1181	Accounts receivable - related parties (Notes VI (3), (24) and VII)	1,723,474	4	806,006	2	2180	Accounts payable - related parties (Note VI (24) and VII)		6,692,003	14	6,204,159	13
1200	Other receivables (Note VI (3) and (24))	32,068	-	86,060	-	2200	Other payables (Note VI (24))		477,767	1	423,908	1
1210	Other receivables - related parties (Notes VI (3), (24) and VII)	2,255	-	-	-	2220	Other payables - related parties (Note VI (24) and VII)		8,003	-	7,426	-
1220	Current tax assets (Note VI (17))	66	-	-	-	2230	Current tax liabilities (Note VI (17))		889,126	2	913,640	2
130X	Inventories (Note VI (4))	1,114,420	2	1,069,881	2	2280	Current lease liabilities (Note VI (12), (24), (27) and VII)		59	-	-	-
1410	Advance payment	8,518	-	8,709	-	2365	Current refund liabilities (Note VI (13))		626,736	1	548,478	1
1476	Other current financial assets (Note VIII)	205	-	-	-	2300	Other current liabilities		329,935	1	20,929	-
		15,801,203	34	20,802,333	43				9,034,273	19	11,858,888	25
Non-current assets:
1510	Non-current financial assets at fair value through profit or loss (Note VI (2) and (24))	247,232	1	230,008	1	2550	Non-current provisions (Note VI (14) and (16))		43,187	-	38,516	-
1517	Non-current financial assets at fair value through other comprehensive income (Note VI (2) and (24))	199,140	-	103,716	-	2570	Deferred tax liabilities (Note VI (17))		93,011	-	64,833	-
						2600	Other non-current liabilities		193	-	193	-
1550	Investments accounted for using the equity method (Note VI (5) and XIII)	30,176,033	63	26,077,007	54				136,391	-	103,542	-
1600	Property, plant and equipment (Note VI (6) and VIII)	730,610	2	289,259	1				9,170,664	19	11,962,430	25
1755	Right-of-use assets (Note VI (7))	58	-	-	-
1760	Investment property (Note VI (8), (24) and VIII)	212,079	-	216,733	1
1780	Intangible assets (Note VI (9))	73,743	-	16,225	-	3110	Ordinary shares (Note VI (18))		1,125,347	2	1,125,347	2
1840	Deferred tax assets (Note VI (17))	147,171	-	136,523	-	3200	Capital surplus (Note VI (18))		9,863,444	21	9,830,950	21
1900	Other non-current assets	27,237	-	60,643	-	3300	Retained earnings (Note VI (18))		28,127,001	59	24,935,301	52
		31,813,303	66	27,130,114	57	3400	Other equity (Note VI (18))		4,202	-	78,419	-
						3500	Treasury stock (Note VI (18))		(676,152)	(1)	-	-
							Total equity		38,443,842	81	35,970,017	75
Total assets		$ 47,614,506	100	47,932,447	100				$ 47,614,506	100	47,932,447	100

Total assets

(Please read the Notes to the Parent Company Only Financial Statements)

Chairman: CHU, TE-HSIANG

Manager: HO, TE-YU

Accounting Manager: WU, CHIA-CHI

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)
Lotes Co., Ltd.
Statements of Comprehensive Income
For the Years Ended December 31, 2025 and 2024
Unit: NT$ thousands

		2025		2024
		Amount	%	Amount	%
4000	Operating revenue (Note VI (13), (24), VII and XIV)	$ 24,023,091	100	19,418,200	100
5000	Operating cost (Note VI (4) and XII)	16,405,159	68	13,261,717	68
	Gross profit	7,617,932	32	6,156,483	32
5910	Less: Unrealized sales (loss) gain	27,104	-	-	-
	Realized gross profit	7,590,828	32	6,156,483	32
	Operating expense (Note VI (12), (15), (16), (23), (24), VII and XII):
6100	Selling expenses	733,856	3	353,102	2
6200	Administrative expenses	524,954	2	458,889	2
6300	Research and development expenses	90,644	-	69,533	-
6450	Impairment loss (gain) determined in accordance with IFRS 9	(43)	-	679	-
	Total operating expense	1,349,411	5	882,203	4
	Net operating profit	6,241,417	27	5,274,280	28
	Non-operating income/expense(Note VI (5), (15), (22) and VII):
7100	Interest income	226,192	1	453,430	2
7010	Other income	195,708	1	160,101	1
7020	Other gains and losses	(682,355)	(3)	650,974	3
7050	Finance costs	(26,598)	-	(43,992)	-
7055	Reversal of impairment loss determined in accordance with IFRS 9	-	-	1,644	-
7070	Share in the gain or loss of subsidiaries, associates and joint ventures accounted for using the equity method	3,373,686	14	4,237,150	22
	Total non-operating revenue/expense	3,086,633	13	5,459,307	28
	Net profit before tax from continuing operations	9,328,050	40	10,733,587	56
7950	Less: Income tax expense(Note VI (17))	1,462,051	6	1,456,635	8
	Net profit for the period	7,865,999	34	9,276,952	48
8300	Other comprehensive income:
8310	Components of other comprehensive income that will not be reclassified to profit or loss
8311	Remeasurements of defined benefit plans	(5,136)	-	4,579	-
8316	Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income	25,424	-	(2,884)	-
8330	Share of other comprehensive income of subsidiaries, associates and joint ventures accounted for using equity method, components of other comprehensive income that will not be reclassified to profit or loss	(389)	-	(246)	-
8349	Less: Income tax related to components of other comprehensive income that will not be reclassified to profit or loss	(1,027)	-	916	-
	Total components of other comprehensive income that will not be reclassified to profit or loss	20,926	-	533	-
8360	Components of other comprehensive income that will be reclassified to profit or loss
8361	Exchange differences on translation	(101,391)	-	868,882	4
8380	Share of other comprehensive income of associates and joint ventures accounted for using the equity method – items that may be reclassified subsequently to profit or loss	27	-	3	-
8399	Less: Income tax related to components of other comprehensive income that will be reclassified to profit or loss	-	-	-	-
	Total components of other comprehensive income that will be reclassified to profit or loss	(101,364)	-	868,885	4
8300	Other comprehensive income for the period (net)	(80,438)	-	869,418	4
	Total other comprehensive income for the period	$ 7,785,561	34	10,146,370	52
	Basic earnings per share (Unit: NT$) (Note VI (20))	$	70.17		82.77
	Diluted earnings per share (Unit: NT$) (Note VI (20))	$	70.06		82.33

(Please read the Notes to the Parent Company Only Financial Statements)
Chairman: CHU, TE-HSIANG
Manager: HO, TE-YU
Accounting Manager: WU, CHIA-CHI

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)
Lotes Co., Ltd.
Statements of Changes in Equity
For the Years Ended December 31, 2025 and 2024

Unit: NT$ thousands

	Share capital		Retained earnings				Other equity
	Ordinary shares	Certificates of bond-to-stock conversion	Capital surplus	Legal reserve	Special reserve	Unappropriated retained earnings	Exchange differences on translation of foreign financial statements	Unrealized gains (losses) on financial assets measured at FVTOCI	Unearned compensation to employees	Treasury stock	Total equity
Balance on January 1, 2024	$ 1,113,298	1,423	8,896,393	2,544,335	339,030	15,669,563	(769,007)	(15,814)	(6,162)	-	27,773,059
Profit for the period	-	-	-	-	-	9,276,952	-	-	-	-	9,276,952
Other comprehensive income for the period	-	-	-	-	-	3,696	868,885	(3,163)	-	-	869,418
Total other comprehensive income for the period	-	-	-	-	-	9,280,648	868,885	(3,163)	-	-	10,146,370
Appropriation and distribution of retained earnings:
Appropriation of legal reserve	-	-	-	559,120	-	(559,120)	-	-	-	-	-
Appropriation of special reserve	-	-	-	-	451,954	(451,954)	-	-	-	-	-
Cash dividends on ordinary share	-	-	-	-	-	(2,898,275)	-	-	-	-	(2,898,275)
Other changes in capital surplus:
Changes in equity of subsidiaries, associates and joint ventures accounted for using equity method	-	-	90,994	-	-	-	-	-	-	-	90,994
Conversion of convertible bonds	12,049	(1,423)	843,563	-	-	-	-	-	-	-	854,189
Changes in ownership interests of subsidiaries	-	-	-	-	-	-	-	-	3,680	-	3,680
Balance on December 31, 2024	1,125,347	-	9,830,950	3,103,455	790,984	21,040,862	99,878	(18,977)	(2,482)	-	35,970,017
Profit for the period	-	-	-	-	-	7,865,999	-	-	-	-	7,865,999
Other comprehensive income for the period	-	-	-	-	-	(4,109)	(101,364)	25,035	-	-	(80,438)
Total other comprehensive income for the period	-	-	-	-	-	7,861,890	(101,364)	25,035	-	-	7,785,561
Appropriation and distribution of retained earnings:
Appropriation of legal reserve	-	-	-	928,494	-	(928,494)	-	-	-	-	-
Reversal of special reserve	-	-	-	-	(869,403)	869,403	-	-	-	-	-
Cash dividends on ordinary share	-	-	-	-	-	(4,670,190)	-	-	-	-	(4,670,190)
Other changes in capital surplus:
Changes in equity of subsidiaries, associates and joint ventures accounted for using equity method	-	-	(6,585)	-	-	-	-	-	-	-	(6,585)
Treasury shares repurchase	-	-	-	-	-	-	-	-	-	(676,152)	(676,152)
Changes in ownership interests of subsidiaries	-	-	-	-	-	-	-	-	2,112	-	2,112
Share-based payment transactions	-	-	39,079	-	-	-	-	-	-	-	39,079
Balance on December 31, 2025	$ 1,125,347	-	9,863,444	4,031,949	(78,419)	24,173,471	(1,486)	6,058	(370)	(676,152)	38,443,842

(Please read the Notes to the Parent Company Only Financial Statements)

Chairmam: CHU, TE-HSIANG

Manager: HO, TE-YU

Accounting Manager: WU, CHIA-CHI

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)
Lotes Co., Ltd.
Statements of Cash Flows
For the Years Ended December 31, 2025 and 2024
Unit: NT$ thousands

	2025	2024
Cash flows from (used in) operating activities:
Profit before tax	$ 9,328,050	10,733,587
Adjustments:
Adjustments to reconcile profit (loss)
Depreciation expenses	13,092	12,054
Amortization expenses	20,244	22,139
Expected credit loss (gain)	(43)	(965)
Interest expenses	26,598	43,992
Interest income	(226,192)	(453,430)
Dividend income	(2,811)	-
Share of the gain of subsidiaries, associate and joint ventures accounted for using the equity method	(3,346,582)	(4,237,150)
Net (gain) loss on financial assets at fair value through profit or loss	(194,689)	21,837
Inventory write-downs and obsolescence (reversal gains)	(460)	(42,088)
Loss (gain) on disposal of property, plant and equipment	(4)	(17)
Compensation expense for share-based payment	40,054	-
Total adjustments to reconcile profit (loss)	(3,670,793)	(4,633,628)
Changes in operating assets and liabilities:
Changes in operating assets:
Increase in notes receivable	(501)	(232)
Increase in accounts receivable	(1,020,527)	(2,686,641)
Increase in other receivables	(387)	(7,935)
Increase in inventory	(44,079)	(427,428)
Decrease (increase) in advance payment	191	(1,494)
Decrease in other current assets	-	15
Increase in other financial assets	(205)	-
Total changes in operating assets	(1,065,508)	(3,123,715)
Changes in operating liabilities:
Decrease in contract liabilities	(1,237)	(1,795)
Increase in notes payable	1,372	1,570
Increase in accounts payable	488,005	2,461,274
Increase in other payables	55,628	38,160
Decrease in provisions	(465)	(439)
Decrease (increase) in other current liabilities	(15,942)	2,869
Increase in refund liabilities	78,258	128,296
Increase in other non-current liabilities	-	150
Total changes in operating liabilities	605,619	2,630,085
Net changes in assets and liabilities related to operating activities	(459,889)	(493,630)
Total adjustments	(4,130,682)	(5,127,258)
Cash inflow generated from operations	5,197,368	5,606,329
Interest received	280,564	431,843
Dividends received	103,176	129,080
Interest paid	(28,765)	(36,014)
Income taxes paid	(1,468,008)	(1,045,726)
Net cash flows from operating activities	4,084,335	5,085,512

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)

Lotes Co., Ltd.

Statements of Cash Flows

For the Years Ended December 31, 2025 and 2024

Unit: NT$ thousands

	2025	2024
Cash flows from (used in) investing activities:
Proceeds from disposal of financial assets at fair value through other comprehensive income	$ -	2,544
Acquisition of financial assets at fair value through other comprehensive income	(70,000)	(108,000)
Acquisition of financial assets measured at fair value through profit or loss	(632,769)	(223,001)
Proceeds from disposal of financial assets measured at fair value through profit or loss	16,200	8,035
Acquisition of investments accounted for using the equity method	(1,004,911)	(824,023)
Cash inflow from simplified consolidation of subsidiaries	703	-
Acquisition of property, plant and equipment	(449,730)	(2,832)
Proceeds from disposal of property, plant and equipment	4	17
Increase in other receivables	(1,898)	-
Acquisition of intangible assets	(77,762)	(17)
Decrease (increase) in other non-current assets	33,406	(47,368)
Net cash flows from (used in) investing activities:	(2,186,757)	(1,194,645)
Cash flows from (used in) financing activities:
Increase (decrease) in short-term loans	(3,730,000)	2,150,000
Payments of lease liabilities	(58)	(59)
Cash dividends paid	(4,670,190)	(2,898,275)
Employee purchase of treasury shares	324,948	-
Payments to acquire treasury shares	(676,152)	-
Net cash flows from (used in) financing activities	(8,751,452)	(748,334)
Effect of exchange rate changes on cash and cash equivalents	7,527	(4,853)
Net increase (decrease) in cash and cash equivalents	(6,846,347)	3,137,680
Cash and cash equivalents at beginning of period	11,074,514	7,936,834
Cash and cash equivalents at end of period	$ 4,228,167	11,074,514

(Please read the Notes to the Parent Company Only Financial Statements)

Chairman: CHU, TE-HSIANG

Manager: HO, TE-YU

Accounting Manager: WU, CHIA-CHI

Notes to the Parent Company Only Financial Statements

Lotes Co., Ltd.

Notes to the Parent Company Only Financial Statements

For the Years Ended December 31, 2025 and 2024

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

I. Company History

Lotes Co., Ltd. (hereinafter referred to as the “Company”) was incorporated on August 23, 1986 in accordance with the provisions of the Company Act and was approved for registration with its registered office at No.15, Wuxun Street, Anle District, Keelung City. The Company and Subsidiaries (hereinafter referred to as the “Company”) are principally engaged in the sale and purchase of various hardware parts and components, the manufacturing and processing of various terminals and their connectors, the import and export business in connection with the preceding item and the agency of the preceding item in connection with the tender quotation and distribution of products of domestic and foreign manufacturers. (See Note XIV)

II. Approval Date and Procedures of the Parent Company Only Financial Statements

The Parent Company Only Financial Statement was approved and released by the Board of Directors on March 11, 2026.

III. Application of New and Revised Standards and Interpretations

(1) Influence of the Adoption of New and Revised Standards and Integrations Approved by the Financial Supervisory Commission

The Company has applied the following newly revised International Financial Reporting Standards (IFRSs) starting from January 1, 2025, which did not have a significant impact on the Parent Company Only Financial Statements:

Amendments to IAS 21 “Lack of Exchangeability”

(2) Effect of Newly Revised IFRSs Not Yet Adopted but Approved by the Financial Supervisory Commission

The Company has assessed the following newly revised IFRSs, which will be effective starting from January 1, 2026, and concluded that they are not expected to have a significant impact on the Parent Company Only Financial Statements:

IFRS 17 “Insurance Contracts” and Amendments to IFRS 17
Amendments to IFRS 9 and IFRS 7 “Amendments to the Classification and Measurement of Financial Instruments”
Annual Improvements to IFRSs
Amendments to IFRS 9 and IFRS 7 “Contracts Referencing Nature-dependent Electricity”

Notes to the Parent Company Only Financial Statements

(3) Newly Issued and Revised Standards and Interpretations Not Yet Endorsed by the Financial Supervisory Commission

The following standards and interpretations have been issued or amended by the International Accounting Standards Board but have not yet been endorsed by the Financial Supervisory Commission, and may be relevant to the Company:

Newly Issued or Revised Standards	Key Amendments	Effective Date Issued by the IASB
International Financial Reporting Standard 18 – Presentation and Disclosure in Financial Statements	The new standard introduces three categories of income and expenses, two new subtotals in the statement of profit or loss, and a single note related to management performance measures. These changes and enhancements provide more detailed guidance on disaggregation in financial statements, laying the foundation for better and more consistent information for users and will impact all companies.

• More Structured Statement of Profit or Loss: Under existing standards, companies use various formats to present their operating results, making it difficult for investors to compare financial performance across companies. The new standard adopts a more structured format and introduces a newly defined subtotal, “operating profit,” and classifies all income and expenses arising from a company’s main business activities into three new categories.

• Management Performance Measures (MPMs): The new standard introduces a definition of MPMs and requires companies to disclose, in a single note to the financial statements, an explanation of why each metric provides useful information, how it is calculated, and how it reconciles to amounts recognized under IFRSs.

• More Granular Information: The new standard includes enhanced guidance on how companies disaggregate information in financial statements. This includes guidance on whether information should be included in the primary financial statements or further disaggregated in the notes. | January 1, 2027

Note: On September 25, 2025, the Financial Supervisory Commission (the “FSC”) announced via a press release that Taiwan will adopt International Financial Reporting Standard No. 18 starting from the 2028 fiscal year. If a company elects to apply the standard earlier, it may choose early adoption upon approval by the FSC. |
| Amendments to IAS 21 “Translation to a Hyperinflationary Presentation Currency” | The current IAS 21 “The Effects of Changes in Foreign Exchange Rates” does not provide explicit guidance on how to translate an entity’s financial statements from a non-hyperinflationary functional currency into a hyperinflationary presentation currency. To reduce diversity in practice, the amendments clarify that:

• For an entity whose functional currency is not hyperinflationary, when translating financial statement amounts (including comparative periods) into the presentation currency, the closing exchange rate at the most recent reporting date shall be used.

• When translating all amounts (excluding comparative periods) of a foreign operation whose functional currency is not hyperinflationary, the closing exchange rate at the most recent reporting date shall be used, and the comparative periods shall be restated using a general price index. | January 1, 2027 |

Notes to the Parent Company Only Financial Statements

The Company is currently assessing the impact of the above standard and interpretation on its financial position and operating results. The related impact will be disclosed upon completion of the assessment.

The Company anticipates that the following other newly issued or amended standards not yet endorsed will not have a material impact on the Parent Company Only Financial Statements:

Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and Its Associate or Joint Venture”
IFRS 19 “Subsidiaries without Public Accountability: Disclosures” and amendments to IFRS 19

IV. Summary of Major Accounting Policies

The significant accounting policies adopted in the preparation of these Parent Company Only Financial Statements are summarized below. Except where otherwise stated, the following accounting policies have been consistently applied to all periods presented in these Parent Company Only Financial Statements.

(1) Statement of Compliance

These Parent Company Only Financial Statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

(2) Basis of Preparation

Measurement Basis

These Parent Company Only Financial Statements have been prepared on a historical cost basis, except for the following significant items in the balance sheet:

(1) Financial assets at FVTPL, measured at fair value;

(2) Financial assets at FVTOCI, measured at fair value;

(3) Liabilities for cash-settled share-based payment arrangements, measured at fair value; and

(4) Net defined benefit liabilities (or assets), measured as the fair value of plan assets less the present value of the defined benefit obligation, and adjusted for the effect of the asset ceiling as described in Note IV (16).

Functional Currency and Presentation Currency

The Company determines its own functional currency based on the primary economic environment in which it operates. These Parent Company Only Financial Statements are presented in New Taiwan Dollars (NTD), which is the functional currency of the Company. All financial information presented in New Taiwan Dollars is expressed in thousands of New Taiwan Dollars.

(3) Foreign Currency

Foreign Currency Transactions

Foreign currency transactions are translated into the functional currency using the exchange

Notes to the Parent Company Only Financial Statements

rates at the dates of the transactions. At the end of each subsequent reporting period (the "reporting date"), monetary items denominated in foreign currencies are translated into the functional currency using the exchange rate at that date. Non-monetary items denominated in foreign currencies that are measured at fair value are translated using the exchange rates at the date when the fair value was determined, whereas those measured at historical cost are translated using the exchange rates at the date of the transaction.

Exchange differences arising from translation are generally recognized in profit or loss, except for the following, which are recognized in other comprehensive income:

(1) Equity instruments designated as at FVTOCI;
(2) Financial liabilities designated as hedges of a net investment in a foreign operation, to the extent that the hedge is effective; or
(3) Qualifying cash flow hedges, to the extent that the hedge is effective.

2. Foreign Operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated into New Taiwan Dollars at the exchange rates at the reporting date. Income and expenses are translated at the average exchange rates for the period. Exchange differences arising from such translation are recognized in other comprehensive income.

When a foreign operation is disposed of such that control, joint control, or significant influence is lost, the cumulative exchange differences related to that foreign operation are reclassified in full to profit or loss. When there is a partial disposal of a subsidiary that includes a foreign operation, the relevant cumulative exchange differences are reattributed proportionately to non-controlling interests. When there is a partial disposal of an associate or joint venture that includes a foreign operation, the relevant cumulative exchange differences are reclassified proportionately to profit or loss.

Monetary receivables from or payables to a foreign operation for which settlement is neither planned nor likely to occur in the foreseeable future are considered part of the net investment in that foreign operation, and the related foreign exchange gains or losses are recognized in other comprehensive income.

(4) Classification of Current and Non-current Assets and Liabilities

An asset is classified as a current asset if it meets any of the following criteria; all other assets are classified as non-current assets:

It is expected to be realized, or intended to be sold or consumed, in the normal operating cycle;
It is held primarily for trading purposes;

Notes to the Parent Company Only Financial Statements

It is expected to be realized within twelve months after the reporting period; or
It is cash or a cash equivalent (as defined in IAS 7), unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

A liability is classified as a current liability if it meets any of the following criteria; all other liabilities are classified as non-current liabilities:

It is expected to be settled in the normal operating cycle;
It is held primarily for trading purposes;
It is due to be settled within twelve months after the reporting period; or
The Company does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period.

(5) Cash and Cash Equivalents

Cash comprises cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value. Time deposits that meet the definition of cash equivalents and are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes are classified as cash equivalents.

(6) Financial Instruments

Accounts receivable and debt securities issued are initially recognized when they are originated. All other financial assets and financial liabilities are initially recognized when the Company becomes a party to the contractual provisions of the financial instrument. Financial assets (other than accounts receivable that do not contain a significant financing component) and financial liabilities not measured at FVTPL are initially measured at fair value plus transaction costs that are directly attributable to their acquisition or issuance. Accounts receivable that do not contain a significant financing component are initially measured at the transaction price.

Financial Assets

Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace (regular way trades) are accounted for consistently using either trade date accounting or settlement date accounting for all financial assets classified in the same manner.

On initial recognition, financial assets are classified as: financial assets measured at amortized cost, debt investments measured at FVTOCI, equity investments measured at FVTOCI, or financial assets measured at (FVTPL.

The Company reclassifies all affected financial assets only when it changes its business model for managing financial assets, and such reclassification is applied prospectively from the beginning of the next reporting period.

Notes to the Parent Company Only Financial Statements

(1) Financial Assets Measured at Amortized Cost

A financial asset is measured at amortized cost if both of the following conditions are met and it is not designated as at fair value through profit or loss:

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

Subsequent to initial recognition, these assets are measured at amortized cost using the effective interest method, adjusted for any loss allowance. Interest income, foreign exchange gains and losses, and impairment losses are recognized in profit or loss. Any gain or loss on derecognition is recognized in profit or loss.

(2) Financial Assets at FVTOCI

Debt investments are measured at fair value through other comprehensive income if both of the following conditions are met and they are not designated as at fair value through profit or loss:

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

At initial recognition, the Company may make an irrevocable election to present subsequent changes in the fair value of an equity investment that is not held for trading in other comprehensive income.

For debt investments, subsequent measurement is at fair value. Interest income calculated using the effective interest method, foreign exchange gains and losses, and impairment losses are recognized in profit or loss. Other net gains or losses are recognized in other comprehensive income. Upon derecognition, the cumulative amount recognized in other comprehensive income is reclassified to profit or loss.

For equity investments, subsequent measurement is at fair value. Dividend income (unless it clearly represents a recovery of part of the cost of the investment) is recognized in profit or loss. All other net gains or losses are recognized in other comprehensive income and are not reclassified to profit or loss.

Dividend income from equity investments is recognized when the Company's right to receive payment is established (usually on the ex-dividend date).

Notes to the Parent Company Only Financial Statements

(3) Financial Assets at FVTPL

Financial assets that are not classified as measured at amortized cost or at FVTOCI, such as those held for trading or managed and evaluated on a fair value basis, are measured at fair value through profit or loss, including derivative financial assets. At initial recognition, the Company may irrevocably designate a financial asset that otherwise meets the criteria to be measured at amortized cost or at FVTOCI as at FVTPL, if doing so eliminates or significantly reduces an accounting mismatch.

Subsequent to initial recognition, these assets are measured at fair value, and any net gains or losses (including any dividend and interest income) are recognized in profit or loss.

(4) Assessment of Business Model

The Company assesses the objective of the business model in which a financial asset is held at a portfolio level, as this best reflects the way the business is managed and information is provided to management. The information considered includes:

The stated policies and objectives for the portfolio and the operation of those policies. This includes whether management’s strategy focuses on earning contractual cash flows, maintaining a particular interest yield profile, matching the duration of financial assets with the duration of related liabilities or expected cash outflows, or realizing cash flows through the sale of financial assets;
How the performance of the business model and the financial assets held within that business model are evaluated and reported to the key management personnel of the entity;
The risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed; and
The frequency, volume, and timing of sales of financial assets in prior periods, the reasons for such sales, and expectations regarding future sales activity.

Transfers of financial assets to third parties in transactions that do not qualify for derecognition are not considered sales for the purposes described above, which is consistent with the Company’s continuing recognition of the assets.

(5) Assessment of Whether Contractual Cash Flows Are Solely Payments of Principal and Interest (SPPI)

For the purpose of this assessment, “principal” is defined as the fair value of the financial asset at initial recognition. “Interest” consists of consideration for the time value of money, credit risk associated with the principal amount outstanding during a particular period, and other basic lending risks and costs, as well as a profit margin.

In assessing whether the contractual cash flows are solely payments of principal and interest on the principal amount outstanding, the Company considers the contractual terms of the instrument, including whether the financial asset contains contractual terms that could change the timing or amount of contractual cash flows such that it would not

Notes to the Parent Company Only Financial Statements

meet this condition. In making this assessment, the Company considers:

Contingent events that would change the timing or amount of contractual cash flows;
Terms that may adjust the contractual coupon rate, including variable interest rate features;
Prepayment and extension features; and
Terms that limit the Company’s claim to cash flows from specified assets (e.g., non-recourse features).

(6) Impairment of Financial Assets

The Company recognizes loss allowances for expected credit losses (ECL) on financial assets measured at amortized cost (including cash and cash equivalents, notes receivable and accounts receivable, other receivables, refundable deposits, and other financial assets), debt investments measured at FVTOCI, and contract assets.

The following financial assets are measured using a 12-month ECL, while the others are measured using lifetime ECL:

Debt securities that are determined to have low credit risk at the reporting date; and
Other debt securities and bank deposits for which the credit risk (i.e., the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition.

Loss allowances for accounts receivable and contract assets are measured at an amount equal to lifetime ECL.

In determining whether the credit risk has increased significantly since initial recognition, the Company considers reasonable and supportable information that is available without undue cost or effort, including both qualitative and quantitative information, as well as analyses based on the Company’s historical experience, credit assessments, and forward-looking information.

The Company considers a financial asset to be in default when the debtor is unlikely to pay its credit obligations in full to the Company.

Lifetime ECL represents the expected credit losses that result from all possible default events over the expected life of a financial instrument.

12-month ECL represents the portion of lifetime ECL that results from default events that are possible within 12 months after the reporting date (or a shorter period if the expected life of the financial instrument is less than 12 months).

The maximum period considered when estimating ECL is the maximum contractual period over which the Company is exposed to credit risk.

ECL is a probability-weighted estimate of credit losses over the expected life of a financial instrument. Credit losses are measured as the present value of all cash shortfalls, i.e., the difference between the cash flows due to the Company in accordance with the

Notes to the Parent Company Only Financial Statements

contract and the cash flows that the Company expects to receive. ECL is discounted using the effective interest rate of the financial asset.

At each reporting date, the Company assesses whether financial assets measured at amortized cost and debt investments measured at FVTOCI are credit-impaired. A financial asset is considered credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of that financial asset have occurred. Evidence that a financial asset is credit-impaired includes observable data about the following events:

Significant financial difficulty of the borrower or issuer;
A breach of contract, such as default or delinquency beyond a specified period;
The Company granting concessions to the borrower, for economic or contractual reasons relating to the borrower’s financial difficulty, that it would not otherwise consider;
It becoming probable that the borrower will enter bankruptcy or other financial reorganization; or
The disappearance of an active market for the financial asset because of financial difficulties.

Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. Loss allowances for debt investments measured at FVTOCI are recognized in profit or loss and in other comprehensive income, without reducing the carrying amount of the assets.

When the Company has no reasonable expectation of recovering a financial asset in its entirety or a portion thereof, the gross carrying amount of the financial asset is written off directly. For corporate customers, the timing and amount of write-offs are assessed individually based on whether there is a reasonable expectation of recovery. The Company expects that the amounts written off will not be significantly recovered. However, financial assets that have been written off may still be subject to enforcement activities in order to comply with the Company’s procedures for recovery of amounts due.

(7) Derecognition of Financial Assets

The Company derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset have been transferred to another entity, or when it neither transfers nor retains substantially all the risks and rewards of ownership and does not retain control of the financial asset.

When the Company enters into transactions to transfer financial assets and retains all or substantially all of the risks and rewards of ownership of the transferred assets, the transferred assets continue to be recognized in the balance sheet.

Notes to the Parent Company Only Financial Statements

Financial Liabilities and Equity Instruments

(1) Classification of Liabilities or Equity

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

(2) Equity Transactions

An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Equity instruments issued by the Company are recognized at the proceeds received, net of directly attributable issuance costs.

(3) Treasury Shares

When the Company reacquires its own equity instruments that have been previously recognized, the consideration paid, including any directly attributable costs, is recognized as a deduction from equity. The reacquired shares are classified as treasury shares. Subsequent reissuance or resale of treasury shares is recognized as an increase in equity, and the difference between the consideration received and the carrying amount is recognized in capital surplus or retained earnings (if capital surplus is insufficient to absorb the difference).

(4) Compound Financial Instruments

Compound financial instruments issued by the Company comprise convertible bonds denominated in New Taiwan Dollars, under which the holder has an option to convert the bonds into equity, and the number of shares to be issued does not vary with changes in fair value.

At initial recognition, the liability component of a compound financial instrument is measured at the fair value of a similar liability that does not have an equity conversion option. The equity component is measured as the residual amount, being the difference between the fair value of the compound financial instrument as a whole and the fair value of the liability component. Any directly attributable transaction costs are allocated to the liability and equity components in proportion to their initial carrying amounts.

Subsequent to initial recognition, the liability component is measured at amortized cost using the effective interest method, while the equity component is not remeasured.

Interest related to the financial liability is recognized in profit or loss. Upon conversion, the financial liability is reclassified to equity, and no gain or loss is recognized.

(5) Financial Liabilities

Financial liabilities are classified as either measured at amortized cost or at FVTPL. A financial liability is classified as at FVTPL if it is held for trading, is a derivative, or is designated as such at initial recognition. Financial liabilities at FVTPL are measured at fair value, and any net gains or losses, including any interest expense, are recognized in

Notes to the Parent Company Only Financial Statements

profit or loss.

Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss.

(6) Derecognition of Financial Liabilities

The Company derecognizes a financial liability when its contractual obligations are discharged, cancelled, or expire. When the terms of a financial liability are modified and the cash flows of the modified liability are substantially different, the original financial liability is derecognized and a new financial liability is recognized at fair value based on the modified terms.

The difference between the carrying amount of a financial liability derecognized and the consideration paid or payable (including any non-cash assets transferred or liabilities assumed) is recognized in profit or loss.

(7) Offsetting of Financial Assets and Liabilities

Financial assets and financial liabilities are offset and presented on a net basis in the balance sheet only when the Company currently has a legally enforceable right to offset the recognized amounts and intends either to settle on a net basis or to realize the assets and settle the liabilities simultaneously.

Derivative Financial Instruments

The Company holds derivative financial instruments to hedge its exposure to foreign currency risk. Embedded derivatives are separated from the host contract and accounted for separately when certain criteria are met and the host contract is not a financial asset.

Derivatives are initially measured at fair value; subsequent to initial recognition, they are measured at fair value, and any gains or losses arising from remeasurement are recognized directly in profit or loss.

(7) Inventories

Inventories are measured at the lower of cost and net realizable value. Cost includes all costs of acquisition, conversion, and other costs incurred in bringing the inventories to their present location and condition, and is determined using the weighted-average method. The cost of finished goods and work in progress includes an appropriate proportion of manufacturing overheads allocated based on normal production capacity.

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

(8) Investments in Associates

Associates are entities over which the Company has significant influence, but not control or joint control, over their financial and operating policies.

Investments in associates are accounted for using the equity method. Under the equity method,

Notes to the Parent Company Only Financial Statements

investments are initially recognized at cost, including transaction costs. The carrying amount of the investment includes goodwill identified at the time of acquisition, net of any accumulated impairment losses.

The Parent Company Only Financial Statements include the Company’s share of the profit or loss and other comprehensive income of associates, after adjustments are made to align the accounting policies with those of the Company, from the date on which significant influence is obtained until the date on which significant influence ceases. When an associate’s changes in equity do not arise from profit or loss or other comprehensive income and do not affect the Company’s ownership interest, such changes are recognized in capital surplus in proportion to the Company’s ownership interest.

Unrealized gains and losses resulting from transactions between the Company and its associates are recognized only to the extent of the Company’s interest in the associates. When the Company’s share of losses of an associate equals or exceeds its interest in the associate, the Company discontinues recognizing its share of further losses, except to the extent that it has incurred legal or constructive obligations or made payments on behalf of the associate, in which case additional losses and corresponding liabilities are recognized.

When an associate issues new shares and the Company does not subscribe in proportion to its ownership interest, resulting in a change in the ownership percentage and consequently an increase or decrease in the net equity of the investment, such change shall be adjusted to capital surplus and investments accounted for using the equity method. If such adjustment reduces capital surplus and the balance of capital surplus arising from investments accounted for using the equity method is insufficient, the difference shall be debited to retained earnings. Where the Company’s ownership interest in an associate decreases due to failure to subscribe proportionately, amounts previously recognized in other comprehensive income in relation to that associate shall be reclassified in proportion to the decrease. The basis of such accounting treatment is consistent with that required if the associate had directly disposed of the related assets or liabilities.

(9) Investments in Subsidiaries

When preparing the parent company only financial statements, investments in investees over which the Company has control are accounted for using the equity method. Under the equity method, profit or loss and other comprehensive income for the current period in the parent company only financial statements are the same as the shares of profit or loss and other comprehensive income attributable to owners of the parent in the consolidated financial statements. Likewise, equity in the parent company only financial statements is the same as the equity attributable to owners of the parent in the consolidated financial statements.

Changes in the Company’s ownership interest in subsidiaries that do not result in a loss of control are accounted for as equity transactions with owners.

Notes to the Parent Company Only Financial Statements

(10) Investment Property

Investment property is property held to earn rental income, capital appreciation, or both, rather than for use in the production or supply of goods or services or for administrative purposes. Investment property is initially measured at cost and subsequently measured at cost less accumulated depreciation and accumulated impairment losses. The depreciation method, useful lives, and residual values are consistent with those applied to property, plant and equipment. Gains or losses arising from the disposal of investment property, determined as the difference between the net disposal proceeds and the carrying amount of the asset, are recognized in profit or loss.

Rental income from investment property is recognized in other income on a straight-line basis over the lease term. Lease incentives granted are recognized as an integral part of total rental income over the lease term.

(11) Property, Plant and Equipment

Recognition and Measurement

Items of property, plant and equipment are measured at cost (including capitalized borrowing costs) less accumulated depreciation and any accumulated impairment losses.

When significant components of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Any gain or loss on disposal of property, plant and equipment is recognized in profit or loss.

Subsequent Costs

Subsequent expenditures are capitalized only when it is probable that the future economic benefits associated with the expenditure will flow to the Company.

Depreciation

Depreciation is calculated based on the cost of an asset less its residual value and is recognized in profit or loss on a straight-line basis over the estimated useful lives of each component.

Land is not depreciated.

The estimated useful lives for the current and comparative periods are as follows:

(1) Buildings and structures 20~40 years
(2) Machinery and equipment 2~10 years
(3) Other equipment 2~15 years

The Company reviews the depreciation methods, useful lives, and residual values at each reporting date and adjusts them if appropriate.

Reclassification to Investment Property

When property occupied by the Company changes its use to investment property, it is reclassified as investment property at its carrying amount at the date of change in use.

Notes to the Parent Company Only Financial Statements

(12) Leases

At inception of a contract, the Company assesses whether the contract is, or contains, a lease. A contract is, or contains, a lease if it conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

Lessee

At the commencement date of the lease, the Company recognizes a right-of-use asset and a lease liability. The right-of-use asset is initially measured at cost, which comprises the initial measurement of the lease liability, adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred, and an estimate of costs to dismantle and remove the underlying asset and restore the site or the underlying asset, less any lease incentives received.

Subsequently, the right-of-use asset is depreciated on a straight-line basis from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. In addition, the Company periodically assesses whether the right-of-use asset is impaired and recognizes any impairment losses identified. The right-of-use asset is also adjusted for any remeasurement of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date. The lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined; if not, the Company uses its incremental borrowing rate. In general, the Company uses its incremental borrowing rate as the discount rate.

Lease payments included in the measurement of the lease liability comprise:

(1) Fixed payments, including in-substance fixed payments;
(2) Variable lease payments that depend on an index or a rate, initially measured using the index or rate at the commencement date;
(3) Amounts expected to be payable under residual value guarantees; and
(4) The exercise price of a purchase option if the Company is reasonably certain to exercise that option, and payments of penalties for terminating the lease, if the lease term reflects the Company exercising a termination option.

Subsequently, the lease liability is measured at amortized cost using the effective interest method and is remeasured when:

(1) There is a change in future lease payments arising from a change in an index or rate;
(2) There is a change in the amounts expected to be payable under a residual value guarantee;
(3) There is a change in the assessment of a purchase option;

Notes to the Parent Company Only Financial Statements

(4) There is a change in the assessment of whether the Company will exercise an extension or termination option, resulting in a change in the lease term; or
(5) There is a modification to the lease contract.

When the lease liability is remeasured due to changes in an index or rate, residual value guarantees, or reassessment of purchase, extension, or termination options, a corresponding adjustment is made to the carrying amount of the right-of-use asset. If the carrying amount of the right-of-use asset is reduced to zero, any remaining remeasurement amount is recognized in profit or loss.

For lease modifications that decrease the scope of the lease, the carrying amount of the right-of-use asset is reduced to reflect the partial or full termination of the lease, and any difference between the remeasurement of the lease liability and the adjustment to the right-of-use asset is recognized in profit or loss.

The Company presents right-of-use assets that do not meet the definition of investment property and lease liabilities as separate line items in the balance sheet.

For short-term leases and leases of low-value assets, the Company has elected not to recognize right-of-use assets and lease liabilities. Instead, the related lease payments are recognized as expenses on a straight-line basis over the lease term.

Lessor

When the Company acts as a lessor, it classifies each lease at the inception date as either a finance lease or an operating lease, depending on whether substantially all the risks and rewards incidental to ownership of the underlying asset are transferred. In making this assessment, the Company considers specific indicators, including whether the lease term covers a major part of the economic life of the underlying asset.

When the Company is an intermediate lessor in a sublease arrangement, it accounts for the head lease and the sublease separately and classifies the sublease by reference to the right-of-use asset arising from the head lease. If the head lease is a short-term lease to which the recognition exemption is applied, the sublease is classified as an operating lease.

(13) Intangible Assets

Recognition and Measurement

Other intangible assets, such as computer software acquired by the Company, are measured at cost less accumulated amortization and accumulated impairment losses.

Subsequent Expenditure

Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is recognized in profit or loss as incurred, including internally generated goodwill and brands.

Notes to the Parent Company Only Financial Statements

Amortization

Amortization is calculated based on the cost of the asset less its estimated residual value and is recognized in profit or loss on a straight-line basis over the estimated useful lives of 1 to 5 years, commencing from the date the asset is available for use.

The Company reviews the amortization method, useful lives, and residual values of intangible assets at each reporting date and adjusts them if appropriate.

(14) Impairment of Non-financial Assets

At each reporting date, the Company assesses whether there is any indication that the carrying amount of non-financial assets (other than inventories and deferred tax assets) may be impaired. If any such indication exists, the recoverable amount of the asset is estimated. Goodwill is tested for impairment annually.

For the purpose of impairment testing, assets are grouped into the smallest identifiable group of assets that generates cash inflows largely independent of the cash inflows from other assets or groups of assets (cash-generating units).

The recoverable amount of an individual asset or a cash-generating unit is the higher of its fair value less costs of disposal and its value in use. If the recoverable amount is less than the carrying amount, an impairment loss is recognized. Impairment losses are recognized immediately in profit or loss and are allocated first to reduce the carrying amount of any goodwill allocated to the cash-generating unit, and then to the other assets of the unit on a pro rata basis according to their carrying amounts.

Impairment losses recognized for goodwill are not reversed. For other non-financial assets, impairment losses are reversed only to the extent that the carrying amount does not exceed the carrying amount that would have been determined (net of depreciation or amortization) had no impairment loss been recognized in prior periods.

(15) Provisions

Provisions are recognized when the Company has a present obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and the amount of the obligation can be reliably estimated.

The amount recognized as a provision is the best estimate of the expenditure required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using estimated cash flows to settle the present obligation, its carrying amount is the present value of those cash flows.

Notes to the Parent Company Only Financial Statements

(16) Revenue Recognition

Revenue from Contracts with Customers

Revenue is measured based on the consideration to which the Company expects to be entitled in exchange for transferring goods or services. The Company recognizes revenue when it satisfies a performance obligation by transferring control of a good or service to a customer.

The Company manufactures electronic components and sells them to manufacturers in the electronics industry. Revenue is recognized when control of the products is transferred to the customer. Transfer of control occurs when the products are delivered to the customer, the customer has full discretion over the distribution channels and pricing of the products, and there are no remaining performance obligations that could affect the customer's acceptance of the products. Delivery occurs when the products are shipped to the specified location, the risks of obsolescence and loss have been transferred to the customer, and the customer has accepted the products in accordance with the sales contract, the acceptance provisions have lapsed, or the Company has objective evidence that all acceptance criteria have been satisfied.

Revenue is recognized based on the contract price net of estimated discounts. The amount of discounts is estimated based on historical experience and is recognized only to the extent that it is highly probable that a significant reversal will not occur. As of the reporting date, the expected amounts payable to customers arising from such discounts are recognized as refund liabilities. The average credit period for sales ranges from 120 to 150 days, which is consistent with industry practice; therefore, no financing component is considered.

The Company recognizes accounts receivable when the goods are delivered, as it has an unconditional right to consideration at that point in time.

The Company expects that, for all customer contracts, the period between the transfer of goods or services and the payment by the customer will not exceed one year. Accordingly, the Company does not adjust the transaction price for the time value of money.

(17) Employee Benefits

Defined Contribution Plans

Obligations for contributions to defined contribution plans are recognized as expenses during the period in which employees render services.

Defined Benefit Plans

The Company's net obligation in respect of defined benefit plans is calculated as the present value of the future benefits earned by employees for services rendered in the current or prior periods, less the fair value of plan assets.

The defined benefit obligation is calculated annually by qualified actuaries using the projected unit credit method. When the calculation results in a potential asset for the Company, the recognized asset is limited to the present value of any economic benefits available in the form of refunds from the plan or reductions in future contributions to the

Notes to the Parent Company Only Financial Statements

plan. In determining the present value of economic benefits, any minimum funding requirements are taken into account.

Remeasurements of the net defined benefit liability, including actuarial gains and losses, the return on plan assets (excluding interest), and any change in the effect of the asset ceiling (excluding interest), are recognized immediately in other comprehensive income and accumulated in retained earnings. The Company determines the net interest expense (income) on the net defined benefit liability (asset) by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual reporting period. Net interest expense and other expenses related to defined benefit plans are recognized in profit or loss.

When a plan amendment or curtailment occurs, the resulting changes in benefits related to past service cost or gains or losses on curtailment are recognized immediately in profit or loss. The Company recognizes gains or losses on the settlement of defined benefit plans when the settlement occurs.

3. Short-term Employee Benefits

Obligations for short-term employee benefits are recognized as expenses when the related services are rendered. A liability is recognized for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past services provided by employees, and the obligation can be reliably estimated.

(18) Share-based Payment Transactions

Equity-settled share-based payment arrangements are measured at the fair value at the grant date and recognized as expenses, with a corresponding increase in equity, over the vesting period of the awards. The amount recognized as an expense is adjusted based on the number of awards expected to meet the service conditions and non-market vesting conditions, and is ultimately measured based on the number of awards that meet the service conditions and non-market vesting conditions at the vesting date.

Non-vesting conditions of share-based payment arrangements are reflected in the measurement of the fair value at the grant date, and differences between expected and actual outcomes are not subsequently adjusted.

For cash-settled share appreciation rights, the fair value of the amount payable to employees is recognized as an expense, with a corresponding increase in liabilities, over the period during which the employees become unconditionally entitled to the payment. The liability is remeasured at fair value at each reporting date and at settlement date, and any changes in fair value are recognized in profit or loss.

Notes to the Parent Company Only Financial Statements

(19) Income Taxes

Income taxes comprise current income taxes and deferred income taxes. Except for those related to business combinations or items recognized directly in equity or other comprehensive income, current income taxes and deferred income taxes are recognized in profit or loss.

The Company has determined that the top-up tax payable under the global minimum tax rules (Pillar Two) falls within the scope of IAS 12, and has applied the temporary mandatory exception for the accounting of deferred income taxes related to the top-up tax. Any top-up tax incurred is recognized as current income tax.

Current income tax includes the expected tax payable or receivable on the taxable income (or loss) for the current year, and any adjustments to tax payable or receivable in respect of prior years. It is measured as the best estimate of the amount expected to be paid or received, using the tax rates enacted or substantively enacted at the reporting date.

Deferred income tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax bases at the reporting date. Deferred income tax is not recognized for the following temporary differences:

Temporary differences arising from the initial recognition of assets or liabilities in a transaction that is not a business combination and, at the time of the transaction, (i) affects neither accounting profit nor taxable income (loss) and (ii) does not give rise to equal taxable and deductible temporary differences;
Temporary differences related to investments in subsidiaries, associates, and joint arrangements, to the extent that the Company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future; and
Taxable temporary differences arising from the initial recognition of goodwill.

Deferred income tax assets are recognized for unused tax losses, unused tax credits carried forward, and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred income tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefits will be realized, or reversed to the extent that it becomes probable that sufficient taxable profits will be available.

Deferred income tax is measured using the tax rates expected to apply when the temporary differences reverse, based on the tax rates enacted or substantively enacted at the reporting date.

Notes to the Parent Company Only Financial Statements

The Company offsets deferred income tax assets and deferred income tax liabilities only when the following conditions are met:

The Company has a legally enforceable right to offset current income tax assets against current income tax liabilities; and
The deferred income tax assets and deferred income tax liabilities relate to income taxes levied by the same taxation authority on either:
(1) the same taxable entity; or
(2) different taxable entities that intend either to settle current income tax liabilities and assets on a net basis or to realize the assets and settle the liabilities simultaneously in each future period in which significant amounts of deferred income tax assets or liabilities are expected to be recovered or settled.

(20) Earnings per Share

The Company presents basic and diluted earnings per share attributable to ordinary equity holders of the Company. Basic earnings per share is calculated by dividing profit or loss attributable to ordinary equity holders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share is calculated by adjusting profit or loss attributable to ordinary equity holders of the Company and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares. Potential dilutive ordinary shares of the Company include convertible bonds and employee stock options.

(21) Segment Information

The Company has disclosed segment information in the consolidated financial statements; therefore, no segment information is disclosed in the parent company only financial statements.

V. Primary Sources of Major Accounting Judgment, Estimate and Assumption Uncertainties

In preparing these Parent Company Only Financial Statements, management is required to make judgments and estimates about the future (including climate-related risks and opportunities), which affect the application of accounting policies and the reported amounts of assets, liabilities, income, and expenses. Actual results may differ from these estimates.

Management continually reviews its estimates and underlying assumptions, which are consistent with the Company's risk management framework and climate-related commitments. Revisions to estimates are recognized prospectively in the period in which the estimates are revised and in any future periods affected.

The following assumptions and estimation uncertainties have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next financial year. The related information is as follows:

Notes to the Parent Company Only Financial Statements

Valuation of Inventories

Inventories are measured at the lower of cost and net realizable value. The Company evaluates inventories at the reporting date for losses due to normal shrinkage, obsolescence, or lack of marketability, and writes down inventory costs to net realizable value. Net realizable value of inventories may be significantly affected by rapid changes in the industry and the introduction of new products. For details of inventory valuation and write-downs, please refer to Note VI (4).

VI. Descriptions for Important Accounting Items

(1) Cash and Cash Equivalents

	Dec. 31, 2025	Dec. 31, 2024
Petty cash	$ 45	82
Demand deposits and checking accounts	1,842,438	2,102,711
Time deposits	2,385,684	8,971,721
Cash and cash equivalents as presented in the statement of cash flows	$ 4,228,167	11,074,514

For disclosures of interest rate risk and sensitivity analysis related to the Company's financial assets and liabilities, please refer to Note VI (24).

(2) Financial Assets

Financial Assets at fair value through profit or loss

	Dec. 31, 2025	Dec. 31, 2024
Current:
Listed (OTC) stock	$ 799,422	-
Emerging stock market stock	20,257	-
Beneficiary certificates of funds	11,585	-
Subtotal	831,264	-
Non-current:
Non-derivative financial assets
Private equity funds	74,873	59,964
Overseas bonds	172,359	170,044
Subtotal	247,232	230,008
Total	$ 1,078,496	230,008

For amounts recognized in profit or loss upon remeasurement at fair value, please refer to Note VI (24).

Notes to the Parent Company Only Financial Statements

Financial Assets at at fair value through other comprehensive income

	Dec. 31, 2025	Dec. 31, 2024
Equity instruments measured at at fair value through other comprehensive income:
Current:
Domestic unlisted (non-OTC) stock—AICP	$ -	-
Technology Corporation
Non-current:
Domestic unlisted (non-OTC) stock—G-sau Co.,Ltd	-	15
Domestic unlisted (non-OTC) stock—UPBEAT TECHNOLOGY Co., Ltd.	3,751	15,876
Domestic unlisted (non-OTC) stock—Phoenix VI Capital Venture Capital Co., Ltd.	120,167	87,825
Domestic unlisted (non-OTC) stock—RATIONAL PRECISION INDUSTRIAL CO., LTD.	10,000	-
Domestic unlisted (non-OTC) stock—Ying Hsi Innovation Venture Capital Corporation	12,870	-
Domestic unlisted (non-OTC) stock—Phoenix VII Capital Venture Capital Co., Ltd.	52,352	-
Total	$ 199,140	103,716

The Company holds the above equity investments not for trading purposes and has designated them as financial assets at FVTOCI.

Dividend income recognized by the Company from the above equity investments amounted to NT$1,029 thousand and NT$0 thousand for the years ended December 31, 2025 and 2024, respectively.

On December 18, 2024, the Company adjusted its investment portfolio for asset allocation purposes to diversify risk and disposed of its investment in Lvxing Technology Co., Ltd., which had been designated as at FVTOCI. The fair value at disposal was NT$2,544 thousand, and the cumulative gain or loss on disposal was NT$0 thousand.

For information on market risk, please refer to Note VI (24).

As of December 31, 2025 and 2024, none of the Company’s financial assets were pledged as collateral.

Notes to the Parent Company Only Financial Statements

(3) Notes Receivable, Accounts Receivable and Other Receivables

	Dec. 31, 2025	Dec. 31, 2024
Notes receivable	$ 2,116	1,615
Accounts receivable (including related parties)	9,583,696	8,563,169
Other receivables (including related parties)	34,569	86,306
Loss allowance	(1,818)	(1,861)
	$ 9,618,563	8,649,229

For the movement of loss allowances for notes receivable and accounts receivable as of December 31, 2025 and 2024, please refer to Note VI (24) 1.(3) Impairment Loss.

(4) Inventories

	Dec. 31, 2025	Dec. 31, 2024
Merchandise	$ 1,114,418	1,069,240
Finished goods	-	641
Raw materials	2	-
	$ 1,114,420	1,069,881

As of December 31, 2025 and 2024, inventories of the Company included allowance for inventory write-downs of NT$63,554 thousand and NT$71,111 thousand, respectively.

Details of inventory-related costs and expenses recognized by the Company are as follows:

	2025	2024
Cost of goods sold	$ 16,405,619	13,303,805
Loss on inventory write-down and obsolescence (reversal of write-down)	(460)	(42,088)
Total	$ 16,405,159	13,261,717

As of December 31, 2025 and 2024, none of the Company's inventories were pledged as collateral.

(5) Investments Accounted for Using the Equity Method

Investments accounted for using the equity method by the Company as of the reporting date are as follows:

	Dec. 31, 2025	Dec. 31, 2024
Subsidiaries	$ 30,007,049	25,937,304
Associates	168,984	139,703
	$ 30,176,033	26,077,007

Notes to the Parent Company Only Financial Statements

Subsidiaries

Please refer to the consolidated financial statements for the year ended December 31, 2025.

Simplified merger

The Company conducted a simplified merger with its wholly-owned subsidiary, Jiayou Investment Co., Ltd., with November 17, 2025 as the merger date. After the merger, the Company is the surviving entity, and Jiayou Investment Co., Ltd. is the dissolved entity. All relevant statutory procedures have been completed.

Details of the identifiable net assets acquired and liabilities assumed by the Company from Jiayou Investment Co., Ltd. as of November 17, 2025 are as follows:

Cash	$ 703
Financial assets at fair value through profit or loss – current	44,757
Current tax assets	66
Investments accounted for using the equity method	1,666,585
Total identifiable net assets	$ 1,712,111

Associates

LeRain Technology Co., Ltd. issued new shares through a capital increase in December 2025. The Company did not participate in this cash capital increase. In connection with LeRain Technology Co., Ltd.’s listing on the Innovation Board, the Company disposed of part of its shareholding, resulting in a decrease in its ownership interest from 15.74% to 14.83%.

I-SEE VISION TECHNOLOGY INC. issued new shares on October 23, 2025. The Company did not subscribe for its proportionate share of the capital increase amounting to NT$64,301 thousand, resulting in an increase in its ownership interest from 21.01% to 22.41%.

The Company acquired a 23.50% equity interest in AionChip Technologies CO., LTD. for NT$78,400 thousand in cash on April 25, 2024, thereby obtaining significant influence over the investee.

Notes to the Parent Company Only Financial Statements

The associates accounted for using the equity method by the Company are individually immaterial. Their aggregated financial information, as included in the Parent Company Only Financial Statements of the Company, is summarized as follows:

	Dec. 31, 2025	Dec. 31, 2024
Aggregate carrying amount of interests in individually immaterial associates at the end of the period	$ 168,984	139,703
	2025	2024
Share attributable to the Company:
Net loss for the period	$ (40,408)	(27,356)
Other comprehensive income	27	36
Total comprehensive income	$ (40,381)	(27,320)

3. Collateral

None of the investments accounted for using the equity method by the Company were pledged as collateral.

(6) Property, Plant and Equipment

The changes in the cost, accumulated depreciation, and impairment losses of the Company's property, plant and equipment are as follows:

	Land	Buildings and structures	Machinery and equipment	Others	Total
Cost or Deemed Cost:
Balance as of January 1, 2025	$ 249,650	56,152	9,001	58,470	373,273
Additions	295,337	149,850	-	4,543	449,730
Disposals	-	-	(832)	(2,492)	(3,324)
Balance as of December 31, 2025	$ 544,987	206,002	8,169	60,521	819,679
Balance as of January 1, 2024	$ 249,650	55,866	10,167	58,249	373,932
Additions	-	286	-	2,546	2,832
Disposals	-	-	(1,166)	(2,325)	(3,491)
Balance as of December 31, 2024	$ 249,650	56,152	9,001	58,470	373,273
Depreciation and Impairment Losses
Balance as of January 1, 2025	$ -	26,141	8,270	49,603	84,014
Depreciation for the year	-	4,527	188	3,664	8,379
Disposals	-	-	(832)	(2,492)	(3,324)
Balance as of December 31, 2025	$ -	30,668	7,626	50,775	89,069
Balance as of January 1, 2024	$ -	24,742	9,240	46,182	80,164
Depreciation for the year	-	1,399	196	5,746	7,341
Disposals	-	-	(1,166)	(2,325)	(3,491)
Balance as of December 31, 2024	$ -	26,141	8,270	49,603	84,014
Carrying Amounts:
December 31, 2025	$ 544,987	175,334	543	9,746	730,610
December 31, 2024	$ 249,650	30,011	731	8,867	289,259

For details of property, plant and equipment pledged as collateral for borrowings and credit facilities as of December 31, 2025 and 2024, please refer to Note VIII.

Notes to the Parent Company Only Financial Statements

(7) Right-of-use Assets

The changes in the cost and accumulated depreciation of right-of-use assets recognized by the Company for leases of land, buildings and structures, and other equipment are as follows:

	Buildings and structures
Cost of Right-of-use Assets:
Balance as of January 1, 2025	$ -
Additions	117
Balance as of December 31, 2025	$ 117
Balance as of January 1, 2024	$ 118
Derecognition upon expiration	(118)
Balance as of December 31, 2024	$ -
Depreciation of Right-of-use Assets:
Balance as of January 1, 2025	$ -
Depreciation for the period	59
Balance as of December 31, 2025	$ 59
Balance as of January 1, 2024	$ 59
Depreciation for the period	59
Derecognition upon expiration	(118)
Balance as of December 31, 2024	$ -
Carrying Amounts:
December 31, 2025	$ 58
December 31, 2024	$ -

(8) Investment Property

The changes in the investment property of the Company are as follows:

	Land	Buildings and structures	Total
Cost or Deemed Cost:
Balance as of January 1, 2025	$ 129,386	102,244	231,630
Balance as of December 31, 2025	$ 129,386	102,244	231,630
Balance as of January 1, 2024	$ 129,386	102,244	231,630
Balance as of December 31, 2024	$ 129,386	102,244	231,630
Depreciation and Impairment Losses
Balance as of January 1, 2025	$ -	14,897	14,897
Depreciation for the year	-	4,654	4,654
Balance as of December 31, 2025	$ -	19,551	19,551
Balance as of January 1, 2024	$ -	10,243	10,243
Depreciation for the year	-	4,654	4,654
Balance as of December 31, 2024	$ -	14,897	14,897
Carrying Amounts:
December 31, 2025	$ 129,386	82,693	212,079
December 31, 2024	$ 129,386	87,347	216,733
Fair Value:
December 31, 2025			$ 227,330
December 31, 2024			$ 227,330

As of December 31, 2025 and 2024, details of the Company’s investment property pledged as collateral for borrowings and credit facilities are provided in Note VIII.

Notes to the Parent Company Only Financial Statements

(9) Intangible Assets

The changes in the cost and accumulated amortization of the Company’s intangible assets are as follows:

	Computer software	Others	Total
Cost:
Balance as of January 1, 2025	$ 111,615	600	112,215
Acquired separately	77,762	-	77,762
Balance as of December 31, 2025	$ 189,377	600	189,977
Balance as of January 1, 2024	$ 111,598	600	112,198
Acquired separately	17	-	17
Balance as of December 31, 2024	$ 111,615	600	112,215
Amortization and Impairment Losses:
Balance as of January 1, 2025	$ 95,990	-	95,990
Amortization for the period	20,244	-	20,244
Balance as of December 31, 2025	$ 116,234	-	116,234
Balance as of January 1, 2024	$ 73,851	-	73,851
Amortization for the period	22,139	-	22,139
Balance as of December 31, 2024	$ 95,990	-	95,990
Carrying Amounts:
December 31, 2025	$ 73,143	600	73,743
December 31, 2024	$ 15,625	600	16,225

(10) Short-term Borrowings

Details, terms, and conditions of short-term borrowings of the Company are as follows:

	Dec. 31, 2025
	Currency	Interest rate range	Maturity year	Amount
Unused credit facilities				$ 3,274,330
	Dec. 31, 2024
	Currency	Interest rate range	Maturity year	Amount
Bank borrowings—credit facilities	NTD	1.88%~1.98%	114	$ 3,730,000
Unused credit facilities				$ 2,589,625

Information regarding the Company’s exposure to interest rate risk and credit risk related to unsecured borrowings and credit facilities is disclosed in Notes VI (24) and (25). In addition, details of assets pledged as collateral for bank borrowings are provided in Note VIII, and information on promissory notes issued in connection with bank borrowings and credit facilities is disclosed in Note IX.

Notes to the Parent Company Only Financial Statements

(11) Bonds Payable

Information on the Company’s second domestic unsecured convertible bonds is as follows:

	Dec. 31, 2025	Dec. 31, 2024
Total amount of convertible bonds issued	$ -	1,000,000
Cumulative amount converted	-	(1,000,000)
Ending balance of bonds payable	$ -	-
	2025	2024
Gain (loss) on valuation of embedded derivatives – call options (presented under other gains and losses)	$ -	(8)
Interest expense	$ -	6,139

(1) Issuance Details

On March 9, 2023, the Company issued 10,000 zero percent coupon, three-year unsecured convertible bonds, which will be repaid at maturity in cash based on the face value of the bonds.

The conversion price was initially set at NT$862.1 per share at issuance. If any adjustments to the conversion price occur according to the terms provided in the issuance related to the Company’s common shares, the conversion price is adjusted accordingly. These bonds do not have reset clauses.

The right to redeem the bonds for cash at face value applies if one of the following conditions is met:

A. From the day after three months following the issuance until forty days before the end of the issuance period, if the closing price of the Company's common stock on the Taiwan Stock Exchange exceeds the conversion price of the bonds by at least 30% for thirty consecutive trading days.

B. From the day after three months following the issuance until forty days before the end of the issuance period, if the outstanding balance of the bonds is less than 10% of the original total amount issued.

(2) Conversion Details

In 2024, bondholders exercised conversion rights on 8,819 units of the Company’s Second Unsecured Domestic 3-Year Convertible Bonds, with a total carrying amount of NT$856,386 thousand at the time of conversion. The net change in capital surplus resulting from the bond conversion during the period was NT$843,563 thousand, while the amount converted into capital stock was NT$10,626 thousand. For details of the capital stock conversion, please refer to Note VI (21).

As of July 23, 2024, the entire issuance of the Company’s Second Unsecured Domestic 3-Year Convertible Bonds had been fully converted.

Notes to the Parent Company Only Financial Statements

(12) Lease Liabilities

The book values of the lease liabilities of the Company are as follows:

	Dec. 31, 2025	Dec. 31, 2024
Current	$ 59	-

For the maturity analysis, please refer to Note VI (24).

The amounts recognized in profit or loss are as follows:

	2025	2024
Interest expense for lease liabilities	$ 2	1

The amounts recognized in the Statement of Cash Flows are as follows:

	2025	2024
Total cash outflow from leases	$ 60	60

(13) Refund Liabilities - Current

	Dec. 31, 2025	Dec. 31, 2024
Refund liabilities - current	$ 626,736	548,478

The refund liabilities are mainly the prepayments to customers for the sales discount and defects of electronic components.

(14) Provision for Liabilities

	Dec. 31, 2025	Dec. 31, 2024
Provision for liabilities - non-current
Employee benefits	$ 43,187	38,516

Employee benefits are estimated under the Company’s defined benefit plan. Please refer to Note VI (16).

(15) Operating Lease

The Company leases its investment property, which is classified as an operating lease because almost all risks and rewards belonging to the ownership of the underlying asset have not been transferred. Please refer to Note VI (8) for details of the investment property.

The maturity analysis of lease payments is presented in the following table for the total undiscounted lease payments to be received after the reporting date:

	Dec. 31, 2025	Dec. 31, 2024
Not more than 1 year	$ 2,328	3,742
1-2 years	205	2,039
2-3 years	-	75
Total undiscounted lease payment	$ 2,533	5,856

Rental income generated from investment property amounted to NT$3,599 thousand and NT$3,527 thousand for the years ended December 31, 2025 and 2024, respectively. Direct operating expenses (including repairs and maintenance) incurred for the investment property

Notes to the Parent Company Only Financial Statements

that generated rental income during the current period amounted to NT$4,714 thousand and NT$4,719 thousand for the years ended December 31, 2025 and 2024, respectively.

(16) Employee Benefits

Defined Benefit Plans

The reconciliation of the present value of the defined benefit obligation and the fair value of plan assets of the Company is as follows:

	Dec. 31, 2025	Dec. 31, 2024
Present value of defined benefit obligation	$ 89,118	79,665
Fair value of plan assets	(45,931)	(41,149)
Net defined benefit liability	$ 43,187	38,516

The Company contributes to a defined benefit plan that is deposited in a labor pension reserve account with the Bank of Taiwan. Pension benefits for each employee under the Labor Standards Act are calculated based on the number of service years and the average salary of the last six months prior to retirement.

(1) Composition of Plan Assets

The pension fund contributed by the Company in accordance with the Labor Standards Act is managed by the Bureau of Labor Funds of the Ministry of Labor. In accordance with the "Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund," the minimum annual return distributed from the fund shall not be less than the return calculated based on the two-year time deposit interest rate of local banks. As of the reporting date, the balance of the Company's labor pension reserve account with the Bank of Taiwan amounted to NT$45,931 thousand. Information on the utilization of the labor pension fund assets, including the rate of return and asset allocation, is available on the website of the Bureau of Labor Funds, Ministry of Labor.

(2) Changes in the Present Value of the Defined Benefit Obligation

The changes in the present value of the defined benefit obligation for the years ended December 31, 2025 and 2024 are as follows:

	2025	2024
Defined benefit obligation as of January 1	$ 79,665	79,676
Current service cost and interest	1,515	1,241
Remeasurements of the net defined benefit liability (asset)	7,938	(1,252)
Defined benefit obligation as of December 31	$ 89,118	79,665

Notes to the Parent Company Only Financial Statements

(3) Changes in the Fair Value of Plan Assets

The changes in the fair value of plan assets under the defined benefit plan for the years ended December 31, 2025 and 2024 are as follows:

	2025	2024
Fair value of plan assets as of January 1	$ 41,149	36,142
Interest income	670	431
Remeasurements of the net defined benefit liability (asset)	2,802	3,327
Contributions paid into the plan	1,310	1,249
Fair value of plan assets as of December 31	$ 45,931	41,149

(4) Expenses Recognized in Profit or Loss

The expenses recognized in profit or loss by the Company for the years ended December 31, 2025 and 2024 are as follows:

	2025	2024
Current service cost	$ 220	295
Net interest on the net defined benefit liability	625	515
	$ 845	810
Operating cost	$ 72	73
Selling expenses	374	350
Administrative expenses	264	261
Research and development expenses	135	126
	$ 845	810

(5) Remeasurements of the Net Defined Benefit Liability (Asset) Recognized in Other Comprehensive Income

The accumulated remeasurements of the net defined benefit liability (asset) recognized in other comprehensive income for the years ended December 31, 2025 and 2024 are as follows:

	2025	2024
Accumulated balance as of January 1	$ 3,225	(1,354)
Recognized during the period	(5,136)	4,579
Accumulated balance as of December 31	$ (1,911)	3,225

(6) Actuarial Assumptions

The principal actuarial assumptions used to determine the present value of the defined benefit obligation at the end of the reporting period are as follows:

	Dec. 31, 2025	Dec. 31, 2024
Discount rate	1.35%	1.65%
Future salary increases	2.00%	2.00%

Notes to the Parent Company Only Financial Statements

The Company expects to contribute NT$1,402 thousand and NT$1,258 thousand to the defined benefit plan within one year after the reporting dates of 2025 and 2024, respectively.

The weighted average duration of the defined benefit plan is 8 years as of 2025.

(7) Sensitivity Analysis

The impact of changes in key actuarial assumptions on the present value of the defined benefit obligation as of December 31, 2025 and 2024 is as follows:

	Impact on defined benefit obligation
	Increase by 0.25%	Decrease by 0.25%
December 31, 2025
Discount rate	$ (1,862)	1,923
Future salary increases	1,906	(1,855)
December 31, 2024
Discount rate	(1,692)	1,748
Future salary increases	1,738	(1,691)

The above sensitivity analysis is based on a change in one assumption while holding other assumptions constant. In practice, changes in many assumptions may be interrelated. The sensitivity analysis is consistent with the method used to calculate the net pension liability in the balance sheet.

The methods and assumptions used in preparing the sensitivity analysis are consistent with those used in the prior period.

Defined Contribution Plans

The Company’s defined contribution plan is implemented in accordance with the Labor Pension Act, under which contributions are made at a rate of 6% of each employee’s monthly salary to the individual labor pension accounts with the Bureau of Labor Insurance. Under this plan, once the Company makes fixed contributions to the Bureau of Labor Insurance, it has no further legal or constructive obligation to make additional payments. For the years ended December 31, 2025 and 2024, pension expenses under the defined contribution plan amounted to NT$8,530 thousand and NT$7,783 thousand, respectively, which have been contributed to the Bureau of Labor Insurance.

Details of Employee Benefit Liabilities of the Company

Accrued compensated absences

Dec. 31, 2025	Dec. 31, 2024
$ 4,654	4,342

Notes to the Parent Company Only Financial Statements

(17) Income Taxes

1. Details of Income Tax Expense

	2025	2024
Current income tax expense:
Current tax	$ 1,234,766	1,267,285
Surtax on undistributed earnings	227,783	84,092
Adjustments to current income tax of prior periods	(19,055)	14,787
	1,443,494	1,366,164
Deferred income tax expense:
Origination and reversal of temporary differences	18,557	90,981
Changes in unrecognized deductible temporary differences	-	(510)
	18,557	90,471
Income tax expense	$ 1,462,051	1,456,635

The details of income tax expense (benefit) recognized in other comprehensive income are as follows:

	2025	2024
Items that will not be reclassified to profit or loss:
Remeasurements of defined benefit plans	$ (1,027)	916

The reconciliation between income tax expense (benefit) and profit before tax of the Company for the years ended December 31, 2025 and 2024 is as follows:

	2025	2024
Profit before tax	$ 9,328,050	10,733,587
Income tax calculated based on statutory tax rates	1,865,610	2,146,717
Adjustments in accordance with tax regulations of various jurisdictions	(612,287)	(788,451)
Adjustments to current tax of prior periods	(19,055)	14,277
Surtax on undistributed earnings	227,783	84,092
Total	$ 1,462,051	1,456,635

Notes to the Parent Company Only Financial Statements

2. Deferred Tax Assets and Liabilities

(1) Recognized Deferred Tax Assets

	Dec. 31, 2025	Dec. 31, 2024
Inventory write-downs and obsolescence losses	$ 12,711	14,222
Unfunded pension expenses	22	115
Impairment losses on property, plant and equipment and idle assets	44	44
Refund liabilities and accrued expenses, etc.	125,348	109,697
Expected credit losses on other receivables	49	49
Unrealized valuation losses on financial assets	-	4,426
Remeasurements of defined benefit plans	8,997	7,970
Deferred tax assets	$ 147,171	136,523

(2) Recognized Deferred Tax Liabilities

	Dec. 31, 2025	Dec. 31, 2024
Unrealized foreign exchange gains	$ 58,559	64,833
Unrealized valuation gains on financial assets	34,452	-
Deferred tax liabilities	$ 93,011	64,833

3. Income Tax Assessment

The profit-seeking enterprise income tax returns of the Company have been assessed and approved by the tax authorities up to the year 2023.

4. Global Minimum Tax

The Company recognizes top-up tax as current income tax in the period in which it is incurred. The accounting treatment for deferred income tax related to top-up tax is subject to a temporary mandatory exception; please refer to Note IV for the relevant accounting policy.

The Company’s subsidiaries operating in Germany, Vietnam, Hong Kong, and Thailand are subject to the Global Minimum Tax rules. For the related impact, please refer to the consolidated financial statements for the year ended December 31, 2025.

(18) Capital and Other Equity

As of December 31, 2025 and 2024, the Company’s authorized capital was NT$1,550,000 thousand, with a par value of NT$10 per share, and the issued capital were NT$1,125,347 thousand.

During the period from January 1 to December 31, 2024, the Company issued 1,063 thousand new shares due to the exercise of conversion rights by holders of convertible bonds. On August 9, 2024, the Board of Directors approved that the base date for issuing new common shares was set as August 9, 2024, and the statutory registration process was completed on August 30,

Notes to the Parent Company Only Financial Statements

2024.

In 2023, the Company issued 142 thousand new shares due to the exercise of conversion rights by holders of convertible bonds. As the statutory registration procedures had not yet been completed, the shares were temporarily recorded under “Bond Conversion Entitlement Certificates” in the amount of NT$1,423 thousand. The registration was completed in April 2024.

Capital surplus

The components of the Company’s capital reserve are as follows:

	Dec. 31, 2025	Dec. 31, 2024
Premium of issued shares	$ 6,951,216	6,951,216
Convertible bond conversion premium	2,225,010	2,225,010
Treasury stock transactions	423	423
Change in the net value of the stock of subsidiaries and associates accounted for using the equity method	606,581	613,166
Employee stock options	79,409	40,330
Expired subscription rights	805	805
	$ 9,863,444	9,830,950

In accordance with the Companies Act, capital surplus are required to cover losses first before new shares or cash can be issued in proportion to the shareholders’ original shares. Realized capital surplus referred to in the preceding paragraph include premiums from the issuance of shares in excess of par value and proceeds from gifts received. In accordance with the Regulations Governing the Issuer’s Offerings and Issuance of Marketable Securities, the aggregate amount of capital surplus that may be capitalized each year shall not exceed 10% of the paid-in capital.

Retained earnings

In accordance with the Company's Articles of Incorporation, after the final settlement of each year’s earnings, the Company shall first complete tax contributions, make up for prior years’ deficits, and set aside 10% as a legal reserve, except when the legal reserve has reached the total capital level. Subsequently, according to the laws, the special reserve may be set aside or reversed; if there are any profits remaining, along with accumulated undistributed profits, the board of directors will prepare a profit distribution proposal for resolution at the shareholder's meeting. The distribution of shareholder dividends must not be less than 20% of the net amount of the year's after-tax profits after legally mandated profit reserves have been deducted.

The Company will take into account the environment and growth of the Company and the distribution of earnings should take into account the Company’s future capital expenditure budget and capital requirements, and pay cash dividends of not less than 10% of the

Notes to the Parent Company Only Financial Statements

dividends distributed in the current year.

(1) Legal reserve

If the Company has no deficit, it may, by resolution of the shareholders in general meeting, issue new shares or cash out of the legal reserve to the extent that such reserve exceeds 25% of the paid-in capital.

(2) Special reserve

When the Company distributes the distributable profit, the net decrease in other equity items occurring in the year is added to the undistributed profit of the current period along with other items beyond the net profit after tax. A special reserve is set aside from the undistributed profit of the previous period. For accumulated decrease in other equity items of previous periods, an equal amount of special reserve shall be set aside from the undistributed profit of previous periods and cannot be distributed. When there is a reversal of other decreases in equity, profits can be distributed for the reversed part.

(3) Earnings distribution

On June 13, 2025 and June 13, 2024, the Company’s shareholders resolved at their annual general meetings to approve the appropriation of earnings for the fiscal years 2024 and 2023. The dividends allocated to owners were as follows:

	2024		112年度
	Payout ratio (NT$)	Amount	Payout ratio (NT$)	Amount
Distributed to the holders of ordinary shares:
Cash	$ 41.50	4,670,190	26.00	2,898,275

The Company’s appropriation of earnings for 2025 was proposed by the Board of Directors on March 11, 2026. The amounts of dividends to be distributed to owners are as follows:

	2025
	Payout ratio (NT$)	Amount
Distributed to the holders of ordinary shares:
Cash	$ 35.00	3,923,669

Information regarding the resolutions passed by the Board of Directors and the shareholders’ meeting on earnings distribution can be found on the "Market Observation Post System (MOPS)."

Notes to the Parent Company Only Financial Statements

Treasury stock

For the year ended December 31, 2025, the Company repurchased treasury stock in the aggregate amount of NT$676,152 thousand, as necessary for transfer to employees in accordance with Article 28-2 of the Securities and Exchange Act. As of December 31, 2025, the total shares of treasury stock not yet cancelled amounted to 601 thousand shares.

In accordance with the Securities and Exchange Act, shares of treasury stock held by the Company may not be pledged and are not entitled to shareholders’ rights prior to transfer.

Other equity

	Exchange differences on translation of foreign operations	Unrealized gain (loss) on financial assets measured at FVTOCI	Unearned compensation	Total
Balance on January 1, 2025	$ 99,878	(18,977)	(2,482)	78,419
Exchange differences arising from the translation of the net assets of foreign operations	(101,364)	-	-	(101,364)
Unrealized gains from financial assets measured at FVTOCI	-	25,035	-	25,035
Changes in ownership interests in subsidiaries	-	-	2,112	2,112
Balance on December 31, 2025	$ (1,486)	6,058	(370)	4,202
Balance on January 1, 2024	$ (769,007)	(15,814)	(6,162)	(790,983)
Exchange differences arising from the translation of the net assets of foreign operations	868,885	-	-	868,885
Unrealized losses on financial assets measured at fair value through other comprehensive income	-	(3,163)	-	(3,163)
Changes in ownership interests in subsidiaries	-	-	3,680	3,680
Balance on December 31, 2024	$ 99,878	(18,977)	(2,482)	78,419

(19) Share-based Payment

The Company has the following share-based payment transactions:

	Transfer of treasury shares to employees
	Lotes Co., Ltd.
Date of grant	Dec. 5, 2025
Number of grants	289 thousand shares
Granted to	Current employees of the Company and subsidiaries
Vesting conditions	Immediate vesting
Fair value at the date of grant	$144.95

For the year ended December 31, 2025, the Company recognized compensation cost arising from the transfer of treasury shares to employees amounting to NT$40,054 thousand.

Notes to the Parent Company Only Financial Statements

(20) Earnings per share

The calculation of basic earnings per share and diluted earnings per share of the Company is as follows:

	2025	2024
Basic earnings per share:
Net profit attributable to the Company in the year	$ 7,865,999	9,276,952
Weighted average shares outstanding (1,000 shares)	112,104	112,082
Basic earnings per share	$ 70.17	82.77
Diluted earnings per share:
Net profit attributable to the Company in the year	$ 7,865,999	9,276,952
Dilutive potential ordinary shares:
Convertible bond	-	4,917
Net income attributable to equity holders of the Company’s common stock (adjusted for the effect of dilutive potential common stock)	$ 7,865,999	9,281,869
Weighted average shares outstanding (1,000 shares)	112,104	112,082
Dilutive potential ordinary shares:
Employee compensation	174	146
Convertible bond	-	516
Weighted average common shares outstanding (adjusted for the effect of dilutive potential common stock)	112,278	112,744
Diluted earnings per share	$ 70.06	82.33

(21) Revenue from Contracts with Customers

Disaggregation of revenue by major geographical markets and major products

	2025	2024
Major geographical markets:
Taiwan	$ 3,156,397	2,890,792
Mainland China	16,125,185	13,037,793
Thailand	1,514,929	837,614
Other countries	3,226,580	2,652,001
	$ 24,023,091	19,418,200
Major product/service lines:
Server	$ 10,269,964	6,924,264
DT	7,367,028	6,299,424
NB	3,067,741	2,886,636
Strategic Projects	2,375,686	2,367,878
Automotive	475,340	401,164
Others	467,332	538,834
	$ 24,023,091	19,418,200

Notes to the Parent Company Only Financial Statements

Contract balances

	Dec. 31, 2025	Dec. 31, 2024	113.1.1
Contract liabilities	$ 573	1,810	3,605

The amounts of contract liabilities at the beginning of January 1, 2025 and 2024 recognized as revenue during the years ended December 31, 2025 and 2024 were NT$1,235 thousand and NT$1,795 thousand, respectively.

(22) Non-operating Income and Expenses

Interest Income

Details of interest income of the Company are as follows:

	2025	2024
Bank deposits	$ 216,922	453,294
Others	9,270	136
	$ 226,192	453,430

Other income

Details of other income of the Company are as follows:

	2025	2024
Income from molding	$ 152,310	128,890
Income from samples	15,880	9,304
Income from compensation	12,143	5,737
Income from rentals	3,755	3,683
Income from dividends	2,811	-
Income from royalties	227	1,572
Income from subsidies	-	1,704
Others	8,582	9,211
	$ 195,708	160,101

Other gains and losses

Details of other gains and losses of the Company are as follows:

	2025	2024
Foreign exchange gain (loss)	$ (877,024)	673,163
Net profit (loss) from financial assets measured at FVTPL:
Derivatives:
Embedded derivative	-	(8)
Non-derivatives
Stock	178,470	728
Private equity funds	4,910	253
Overseas bonds	10,285	(22,810)
Beneficiary certificates of funds	1,024	-
Gain on disposal of property, plant and equipment	4	17
Others	(24)	(369)
Total	$ (682,355)	650,974

Notes to the Parent Company Only Financial Statements

4. Financial costs

Details of the financial costs of the Company are as follows:

	2025	2024
Bank loans	$ 26,592	37,850
Lease liabilities	2	1
Conversion of corporate bonds	-	6,139
Others	4	2
	$ 26,598	43,992

(23) Compensation to Employees and Directors

On June 13, 2025, the Company’s shareholders resolved to amend the Articles of Incorporation. According to the amended provisions, if the Company has profits in a given fiscal year, no less than 2% shall be appropriated as employees’ compensation (of which no less than 20% shall be allocated to rank-and-file employees) and no more than 2% as directors’ compensation. However, if the Company has accumulated losses, the amount required to cover such losses shall be reserved first. The recipients of employees’ compensation, in the form of shares or cash, include qualifying subordinate employees. According to the previous Articles of Incorporation, if the Company had profits in a given fiscal year, no less than 2% was to be appropriated as employees’ compensation and no more than 3% as directors’ compensation. However, if the Company had accumulated losses, the amount required to cover such losses had to be reserved first, and then employees’ and directors’ compensation would be appropriated according to the aforementioned ratios. The recipients of employees’ compensation, in the form of shares or cash, could include employees of qualifying controlling or subordinate companies.

For the years ended December 31, 2025 and 2024, the Company accrued employee compensation of NT$191,000 thousand (including NT$38,200 thousand for non-executive employees) and NT$220,000 thousand, respectively, and director compensation of NT$8,000 thousand and NT$4,480 thousand, respectively. Such amounts were estimated based on the Company’s profit before tax for the respective periods, before deduction of employee and director compensation, multiplied by the distribution percentages stipulated in the Company’s Articles of Incorporation, and were recognized as cost of sales or operating expenses for the respective periods. If the actual distribution resolved in the following year differs from the estimated amounts, such differences are accounted for as changes in accounting estimates and recognized in the following year’s profit or loss.

If the actual amounts resolved in the following year differ from the estimated amounts, such differences are accounted for as changes in accounting estimates and recognized in profit or loss in the following year. There was no difference between the amount of employee

Notes to the Parent Company Only Financial Statements

compensation resolved by the Board of Directors and the amount estimated in the 2024 financial statements. For 2024, the amount of director compensation resolved by the Board of Directors differed from the estimated amount by NT$1,020 thousand. The Company accounted for the difference as a change in estimate and recognized it in the profit or loss of 2025. Relevant information is available on the Market Observation Post System.

(24) Information on Financial Instruments and Fair Value

Credit risk

(1) Credit risk exposure

The carrying amount of financial assets represents the maximum exposure to credit risk. The maximum exposure amounts as of December 31, 2025 and 2024 were NT$14,019,249 thousand, NT$19,893,705 thousand, and NT$30,817,719 thousand, respectively.

(2) Credit risk concentration risk

In order to reduce the credit risk of accounts receivable, the Company continually evaluates the financial position of its customers and adjusts the terms of transactions between them if necessary. As of December 31, 2025 and 2024, the Company had four and seven customers, respectively, whose individual account receivable balances exceeded 5% of total accounts receivable. The Company regularly assesses the recoverability of these receivables and recognizes allowance for credit losses as needed. Total losses remain within management's expectations.

(3) The Company applies the simplified approach to estimate expected credit losses on all notes receivable and accounts receivable, which is to measure expected credit losses over the life of the notes and accounts receivable, and for this purpose, the notes and accounts receivable are grouped by common credit risk characteristics that represent the ability of customers to pay all amounts due under contractual terms and are included in forward-looking information. The expected credit losses on the Company's notes and accounts receivable are analyzed as follows:

	Dec. 31, 2025
	Book value of notes and accounts receivable	Weighted average expected credit loss rate	Expected credit loss in the duration of provision
Not past due	$ 9,536,562	0.00%	162
1-60 days past due	43,103	0.89%	384
61-120 days past due	4,391	5.33%	234
121-180 days past due	1,073	20.95%	225
181-270 days past due	308	62.32%	192
More than 271 days past due	375	100.00%	375
	$ 9,585,812		1,572

Notes to the Parent Company Only Financial Statements

	Dec. 31, 2024
	Book value of notes and accounts receivable	Weighted average expected credit loss rate	Expected credit loss in the duration of provision
Not past due	$ 8,474,293	0.00%	151
1-60 days past due	89,250	1.14%	1,015
61-120 days past due	846	7.06%	60
121-180 days past due	-	30.00%	-
181-270 days past due	20	67.32%	14
More than 271 days past due	375	100.00%	375
	$ 8,564,784		1,615

The changes in the provisions for notes and accounts receivable of the Company are as follows:

	2025	2024
Opening balance	$ 1,615	2,311
Recognized on impairment losses (reversal gains)	(43)	679
Write-off	-	(1,375)
Closing balance	$ 1,572	1,615

2. Liquidity risk

The contracts of financial liabilities are sorted by their maturity dates as follows. The estimated interests are included, but the effect of net value agreement is excluded.

	Book value	Cash flow from the contract	Within 6 months	6 12 months	1-2 years	2-5 years	More than 5 years
December 31, 2025
Non-derivative financial liabilities:
Notes payable	$ 8,133	8,133	8,133	-	-	-	-
Accounts payable	1,938	1,938	1,938	-	-	-	-
Accounts payable - related parties	6,692,003	6,692,003	6,692,003	-	-	-	-
Other payables	477,767	477,767	477,767	-	-	-	-
Other payables - related parties	8,003	8,003	8,003	-	-	-	-
Lease liabilities	59	60	30	30	-	-	-
	$ 7,187,903	7,187,904	7,187,874	30	-	-	-
December 31, 2024
Non-derivative financial liabilities:
Short-term loans	$ 3,730,000	3,770,438	958,161	2,812,277	-	-	-
Notes payable	6,761	6,761	6,761	-	-	-	-
Accounts payable	1,777	1,777	1,777	-	-	-	-
Accounts payable - related parties	6,204,159	6,204,159	6,204,159	-	-	-	-
Other payables	423,908	423,908	423,908	-	-	-	-
Other payables - related parties	7,426	7,426	7,426	-	-	-	-
	$ 10,374,031	10,414,469	7,602,192	2,812,277	-	-	-

The Company does not anticipate that the cash flows analyzed at maturity date will alter significantly or that the actual amounts will vary significantly.

Notes to the Parent Company Only Financial Statements

Market risk—exchange rate risk

(1) Exposure to exchange rate risk

The Company’s financial assets and liabilities exposed to significant foreign currency exchange rate risk are as follows:

	Dec. 31, 2025
	Foreign currency	Exchange rate	NTD
Financial assets
Monetary item
USD	$ 335,826	31.4300	10,555,001
RMB	470,061	4.4960	2,113,394
JPY	2,886,141	0.2008	579,537
EUR	4,334	36.9000	159,939
Long-term equity investments
accounted for using the equity method
USD	780,483	31.4300	24,530,586
VND	3,086,227,736	0.0012	3,703,473
	Dec. 31, 2025
	Foreign currency	Exchange rate	NTD
Financial liabilities
Monetary item
USD	$ 194,950	31.4300	6,127,274
RMB	205,652	4.4960	924,612
EUR	547	36.9000	20,173
	Dec. 31, 2024
	Foreign currency	Exchange rate	NTD
Financial assets
Monetary item
USD	$ 528,270	32.7850	17,319,330
RMB	363,523	4.4780	1,627,858
HKD	22	4.2220	93
JPY	10	0.2099	2
EUR	6,139	34.1400	209,581
INR	4	0.4791	2
VND	1,300	0.0013	2
Long-term equity investments
accounted for using the equity method
USD	647,887	32.7850	21,240,973
EUR	148	34.1400	5,046
VND	2,168,686,160	0.0013	2,819,292
Financial liabilities
Monetary item
USD	$ 177,808	32.7850	5,829,445
RMB	144,079	4.4780	645,187
EUR	275	34.1400	9,380
VND	27,598	0.0013	36
THB	123	0.9623	118

Notes to the Parent Company Only Financial Statements

Due to the diversity of functional currencies within the Company, exchange gains and losses on monetary items are disclosed on an aggregated basis. For the years ended December 31, 2025 and 2024, foreign exchange gains and losses (including realized and unrealized amounts) amounted to a loss of NT$877,024 thousand and a gain of NT$673,163 thousand, respectively.

(2) Sensitivity analysis

The Company's exchange rate risk arises mainly from cash and cash equivalents denominated in foreign currencies, financial assets at FVTPL, accounts receivable and other receivables, short-term loans, accounts payable and other payables, which generate foreign currency exchange gains or losses upon translation. As of December 31, 2025 and 2024, if the New Taiwan Dollar had strengthened or weakened by 1% against the foreign currencies held by the Company, with all other variables held constant, profit after tax for the years ended December 31, 2025 and 2024 would have increased or decreased by NT$276,606 thousand and NT$101,382 thousand, respectively. The analysis for both periods is based on the same assumptions.

Market risk—changes in interest rates

The interest rate risk of the Company mainly comes from the bank deposit and loan of floating rate, so the interest rate change will cause the effective interest rate of bank deposit and loan to change accordingly, and the future cash flow will fluctuate.

The following sensitivity analysis is based on the risk of interest rate shocks reported by financial instruments on the date of coverage. For floating rate liabilities, the analysis is based on the assumption that the reported amount of daily outstanding liabilities is current throughout the year. The rate of change used by the Company in reporting interest rates to the key management is 1% up or down, which represents the management's assessment of the reasonable range of possible interest rate changes.

As of December 31, 2025 and 2024, the Company held financial assets with variable interest rates amounting to NT$1,839,642 thousand and NT$2,100,833 thousand, respectively, and financial liabilities with variable interest rates amounting to NT$0 thousand and NT$0 thousand, respectively. If interest rates had increased or decreased by 1%, with all other variables held constant, profit after tax for the years ended December 31, 2025 and 2024 would have increased or decreased by NT$14,717 thousand and NT$16,807 thousand, respectively.

Notes to the Parent Company Only Financial Statements

Market risk—fair value

(1) Fair value and carrying amount

The management of the Company believes that non-derivative short-term financial instruments should be estimated at their fair value based on their book value on the balance sheet, and that their book value should be a reasonable basis for the estimated fair value because of the near expiry date of such commodities. This method is applied to cash and equivalent cash, notes receivable and payable, accounts receivable and payable, other receivables and payables, deposit margin and borrowings.

In addition to the above financial instruments, the fair value and book value information of the remaining financial instruments, investment properties and corporate bonds payable of the Company on the financial reporting date are as follows:

	Dec. 31, 2025		Dec. 31, 2024
	Book value	Fair value	Book value	Fair value
Measured at fair value:
Financial assets:
Financial assets measured at FVTPL	$ 1,078,496	1,078,496	230,008	230,008
Financial assets measured at FVTOCI	199,140	199,140	103,716	103,716
Not measured at fair value
Non-financial assets:
Investment property	$ 212,079	227,330	216,733	227,330

(2) The evaluation techniques used to determine fair value are as follows

A. When financial assets are quoted publicly in an active market, this market price is the fair value. When market prices are not available, estimates are made by reference to quoted counterparties or using valuation techniques. The estimates and assumptions used are consistent with the information used by market participants as estimates and assumptions in pricing financial instruments.

B. The fair value of investment properties is based on the evaluations of independent evaluators with recognized professional qualifications and recent experience in the area and type of investment properties evaluated.

(3) Fair value hierarchy

The following table analyzes the fair value hierarchy of financial instruments, investment properties and corporate bonds payable by valuation. Each fair value hierarchy is defined as follows:

A. Level 1: Publicly quoted prices (unadjusted) in an active market for identical assets or liabilities.

Notes to the Parent Company Only Financial Statements

B. Level 2: Input parameters for an asset or liability are observable either directly (i.e., prices) or indirectly (i.e., derived from prices), except for publicly quoted prices included in Level 1.

C. Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable parameters).

	Level 1	Level 2	Level 3	Total
December 31, 2025
Measured at fair value:
Financial assets measured at FVTPL	$ 831,264	-	247,232	1,078,496
Financial assets measured at FVTOCI	-	-	199,140	199,140
	$ 831,264	-	446,372	1,277,636
Not measured at fair value:
Investment property	$ -	-	227,330	227,330
	Level 1	Level 2	Level 3	Total
December 31, 2024
Measured at fair value:
Financial assets measured at FVTPL	$ -	-	230,008	230,008
Financial assets measured at FVTOCI	-	-	103,716	103,716
	$ -	-	333,724	333,724
	Level 1	Level 2	Level 3	Total
December 31, 2024
Not measured at fair value:
Investment property	$ -	-	227,330	227,330

(4) Transfer between the Level 1 and the Level 2

There were no transfers between Level 1 and Level 2 during year 2025 and 2024.

(5) Statement of changes in financial assets classified as Level 3 at fair value

Unit: NT$ thousands

Name	2025
	Opening balance	Recognized in profit or loss	Recognized in other comprehensive income	Issuance or purchase	Transferred to level 3	Sales, disposal or settlement
Financial assets measured at FVTPL	$ 230,008	7,224	-	10,000	-	247,232
Financial assets measured at FVTOCI	103,716	-	25,424	70,000	-	199,140
	$ 333,724	7,224	25,424	80,000	-	446,372
Name	2024
	Opening balance	Recognized in profit or loss	Recognized in other comprehensive income	Issuance or purchase	Transferred to level 3	Sales, disposal or settlement
Financial assets measured at FVTPL	$ 26,916	(17,712)	-	223,001	-	(2,197)
Financial assets measured at FVTOCI	1,144	-	(2,884)	108,000	-	(2,544)
	$ 28,060	(17,712)	(2,884)	331,001	-	(4,741)

Notes to the Parent Company Only Financial Statements

The above included gains and losses are reported in “other gains and losses” and “unrealized valuation gains (losses) on financial assets at FVTOCI”. The portions related to assets still held as of December 31, 2025 and 2024 are as follows:

	2025	2024
Total gain or loss
Recognized in loss (reported in “other gains and losses”)	$ 7,224	(17,704)
Recognized in other comprehensive income (reported in “unrealized valuation losses on financial assets at FVTOCI”)	25,424	(4,299)

(6) Quantitative information on fair value measurements of significant unobservable inputs (Level 3)

The Company’s fair value measurements classified as Level 3 primarily include financial assets at fair value through profit or loss – derivative financial instruments, private equity fund investments, foreign bonds, and financial assets measured at fair value through other comprehensive income – equity investments. For Level 3 financial assets measured at fair value through profit or loss – foreign bonds, due to the lack of active market quotations, fair value is determined based on counterparty quotations. As it is impracticable to sufficiently understand the correlation between significant unobservable inputs and fair value, quantitative information is not disclosed. Quantitative information for other significant unobservable inputs used in Level 3 fair value measurements is presented below:

Item	Valuation techniques	Significant unobservable inputs	Relationship between significant unobservable inputs and fair value
Financial assets measured at FVTPL - investment in private equity fund	Net asset value approach	·Net asset value	·Higher net asset value leads to higher fair value
Financial assets measured at FVTOCI - investment in equity instruments with no active market	Comparable company analysis	·Price-to-book ratio multiplier: December 31, 2025 – 1.87; December 31, 2024 – 2.30	·The higher the multiplier, the higher the fair value
		·Discount for lack of marketability: December 31, 2025 – 15.60%; December 31, 2024 – 15.60%	·The higher the discount for lack of marketability, the lower the fair value
Financial assets measured at FVTOCI - investment in equity instruments with no active market	Net asset value approach	·Net asset value	·The fair value is positively correlated

Notes to the Parent Company Only Financial Statements

(7) Valuation process for fair value classified in Level 3

The Company uses unobservable inputs for its fair value measurements and classifies its fair value in Level 3. The source of the input value for this level is the price provided by reference to counterparty quotations or market comparable companies' net market value multipliers, etc., and the relevant quotations and valuation information are appropriately maintained. The results are subsequently reviewed to ensure consistency with the valuation sources and the reasonableness of the valuation results.

(8) Sensitivity analysis of fair value to reasonably possible alternative assumptions for Level 3 fair value measurements

The Company's fair value measurements of financial instruments are reasonable, but the use of different valuation models or valuation parameters may result in different valuation results. For financial instruments classified in Level 3, if the valuation parameters are changed, the impact on the profit or loss or other comprehensive income for the period is as follows:

	Input value	Upward or downward changes	Fair value changes reflected in profit or loss for the period		Fair value changes reflected in other comprehensive income
			Favorable changes	Unfavorable changes	Favorable changes	Unfavorable changes
December 31, 2025
Financial assets measured at FVTOCI
Investments in equity instruments with no active market	Net market value multiplier	1%	-	-	48	(31)
	Lack of marketability discount	1%	-	-	48	(31)
December 31, 2024
Financial assets measured at FVTOCI
Investments in equity instruments with no active market	Net market value multiplier	1%	-	-	54	(48)
	Lack of marketability discount	1%	-	-	62	(56)

Favorable and unfavorable changes in fair value represent fluctuations in fair value, which are calculated using valuation techniques based on various degrees of unobservable input parameters. If the fair value of a financial instrument is affected by more than one input, the above table reflects only the effect of changes in a single input and does not take into account the correlation and variability among the inputs.

Notes to the Parent Company Only Financial Statements

(25) Financial Risk Management

The Company is exposed to the following risks arising from financial instruments:

(1) Credit risk
(2) Liquidity risk
(3) Market risk

This note presents information about the Company’s exposure to each of the above risks, the objectives, policies, and processes for measuring and managing risk. Further quantitative disclosures are provided in the respective notes to the Parent Company Only Financial Statements.

Risk Management Framework

The Board of Directors has authorized the Chairman to be fully responsible for establishing and overseeing the Company’s risk management framework, and to report its operation to the Board on a regular basis.

The Company’s risk management policies are established to identify and analyze the risks faced, to set appropriate risk limits and controls, and to monitor risks and adherence to risk limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company’s operations. Through training programs, management guidelines, and operating procedures, the Company aims to develop a disciplined and constructive control environment in which all employees understand their roles and responsibilities.

The Audit Committee oversees how management monitors compliance with the Company’s risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced. Internal auditors assist the Audit Committee in performing its oversight role. They conduct regular and ad hoc reviews of risk management controls and procedures and report the results to the Audit Committee.

Credit Risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s accounts receivable from customers and investments in securities.

(1) Accounts Receivable and Other Receivables

The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers statistical data relating to the Company’s customer base, including the default risk of the industries and countries in which customers operate, as these factors may affect credit risk. Approximately 67% of the Company’s revenue for the years ended December 31, 2025 and 2024 were derived from sales to customers located in Mainland China, resulting in a significant concentration of geographic credit risk.

Notes to the Parent Company Only Financial Statements

The Company has established a credit policy under which each new customer is analyzed individually for creditworthiness before standard payment and delivery terms are offered. Credit limits are established for each customer and are reviewed periodically. Customers that do not meet the Company’s benchmark credit rating may only transact on a prepayment basis.

In monitoring customer credit risk, customers are grouped according to their credit characteristics, including whether they are individuals or legal entities, aging profiles, due dates, and prior financial difficulties. The Company establishes loss allowance accounts to reflect estimated losses for accounts receivable and other receivables.

(2) Investment of Funds

The Company invests in equity securities through centralized trading markets; therefore, there is no significant credit risk associated with such transactions.

The credit risk associated with bank deposits, fixed-income investments, and other financial instruments is measured by the Company’s finance department and reported to the Chairman. As the Company’s counterparties and obligors are reputable banks and financial institutions with investment-grade credit ratings or above, there are no significant concerns regarding default risk, and therefore no significant credit risk exposure.

Liquidity Risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach to managing liquidity risk is to ensure that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation. To address unexpected funding requirements, as of December 31, 2025 and 2024, the Company had unused credit facilities totaling NT$3,274,330 thousand and NT$2,589,625 thousand, respectively.

Market Risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates, and equity prices, will affect the Company’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters while optimizing returns.

The Company engages in derivative transactions to manage market risk. All such transactions are carried out in accordance with the guidelines approved by the Board of Directors.

Notes to the Parent Company Only Financial Statements

(1) Foreign Exchange Risk

The Company is exposed to foreign exchange risk arising from sales and purchases denominated in currencies other than the respective functional currencies of the Company. Accordingly, the Company uses derivative financial instruments to hedge foreign exchange risk. Gains or losses arising from changes in exchange rates on foreign currency-denominated assets and liabilities are generally offset through natural hedging. While derivative transactions help reduce the impact of exchange rate fluctuations, they cannot completely eliminate such effects.

The Company regularly reviews its exposure to individual foreign currency assets and liabilities and implements hedging strategies for such exposures.

(2) Interest Rate Risk

The Company’s interest rate risk arises mainly from variable-rate bank deposits and short-term borrowings. Changes in interest rates will affect the effective interest rates of these instruments and cause fluctuations in future cash flows.

(3) Equity Price Risk

If equity security prices had changed at the reporting date (with all other variables held constant and based on the same assumptions for both periods), the impact on comprehensive income would have been as follows:

	2025		2024
Change in security prices at the reporting date	Other comprehensiv e income (net of tax)	Profit or loss (net of tax)	Other comprehensiv e income (net of tax)	Profit or loss (net of tax)
Increase by 1%	$ 1,991	8,946	1,037	600
Decrease by 1%	$ (1,991)	(8,946)	(1,037)	(600)

(26) Capital Management

The Board of Directors’ policy is to maintain a strong capital base to sustain investor, creditor, and market confidence and to support the future development of the Company’s operations. Capital consists of share capital, capital surplus, and retained earnings of the Company. The Board monitors the return on capital and also monitors the level of dividends on ordinary shares.

To maintain or adjust the capital structure, the Company may adjust dividends paid to shareholders, return capital to shareholders through capital reduction, issue new shares, or sell assets to reduce liabilities.

Notes to the Parent Company Only Financial Statements

The Company monitors capital using the debt-to-capital ratio. This ratio is calculated as net debt divided by total capital. Net debt is defined as total liabilities as shown in the balance sheet less cash and cash equivalents. Total capital is defined as total equity (i.e., share capital, capital surplus, retained earnings, and other equity) plus net debt. The debt-to-capital ratio as of the reporting date is as follows:

	Dec. 31, 2025	Dec. 31, 2024
Total liabilities	$ 9,170,664	11,962,430
Less: cash and cash equivalents	4,228,167	11,074,514
Net debt	$ 4,942,497	887,916
Total equity	$ 38,443,842	35,970,017
Debt-to-capital ratio	11.39%	2.41%

(27) Investment and fund-raising activities for non-cash transactions

The non-cash investing and financing activities of the Company for the years ended December 31, 2025 and 2024 were as follows:

For details on the conversion of convertible corporate bonds into common shares, please refer to Note VI (14).
For details on obtaining right-of-use assets through leasing, please refer to Note VI (9) and (15).

A reconciliation of liabilities arising from financing activities of the Company for the years ended December 31, 2025 and 2024 is shown below:

	Non-cash changes
	Jan. 1, 2025	Cash flow	Other	Changes in exchange rate	Changes in fair value	Dec. 31, 2025
Short-term loans	$ 3,730,000	(3,730,000)	-	-	-	-
Lease liabilities	-	(60)	119	-	-	59
Total liabilities from financing activities	$ 3,730,000	(3,730,060)	119	-	-	59
	Non-cash changes
---	---	---	---	---	---	---
	Jan. 1, 2024	Cash flow	Other	Changes in exchange rate	Changes in fair value	Dec. 31, 2024
Short-term loans	$ 1,580,000	2,150,000	-	-	-	3,730,000
Bonds payable	850,247	-	(850,247)	-	-	-
Lease liabilities	59	(60)	1	-	-	-
Total liabilities from financing activities	$ 2,430,306	2,149,940	(850,246)	-	-	3,730,000

VII. Related Party Transactions

(1) Parent company and ultimate controller: The Company is the ultimate controller of the Company and the Company's subsidiaries.

(2) Names and relationships of related parties

The related parties that had transactions with the Company during the period covered by these Parent Company Only Financial Statements are as follows:

Notes to the Parent Company Only Financial Statements

Name of related parties	Relationship with the Company
Lotes Investments Limited	A subsidiary of the Company
GOOD HOPE INVESTMENTS LIMITED	A subsidiary of the Company
CROWN MIND DEVELOPMENTS LIMITED	A subsidiary of the Company
TASHI INVESTMENTS LIMITED	A subsidiary of the Company
Jiayou Investment Co., Ltd.	A subsidiary of the Company (Note 1)
Lotes USA, Inc.	A subsidiary of the Company
LOTES EU GmbH	A subsidiary of the Company
Lomites Co., Ltd.	A subsidiary of the Company
LOTES VIET NAM COMPANY LIMITED	A subsidiary of the Company
LOTESON INTERNATIONAL INVESTMENTS LTD.	A subsidiary of the Company
LOTES GUANGZHOU CO., LTD.	A subsidiary of the Company
LOTES HENGNAN CO., LTD.	A subsidiary of the Company
LOTES SHENZHEN CO., LTD.	A subsidiary of the Company
LOTES ZHONGSHAN CO., LTD.	A subsidiary of the Company
Zhongshan Dezhi Real Estate Development Co., Ltd.	A subsidiary of the Company
Zhongshan Dezhi Metal Surface Treatment Co., Ltd.	A subsidiary of the Company
Zhongshan Jinmeida Metal Surface Treatment Co., Ltd.	A subsidiary of the Company
LOTESPEED TECHNOLOGY GUANGZHOU LTD.	A subsidiary of the Company
CHONGGING FOISON ELECTRONIC TECHNOLOGY CO., LTD.	A subsidiary of the Company
Lotes (Hengnan) Business Development Co., LTD.	A subsidiary of the Company
Guangzhou Dezhi Technology Co., Ltd.	A subsidiary of the Company
Sky Comet Zhongshan Electronics Co., Ltd.	A subsidiary of the Company
Huili Electronics Technology (Ningbo) Co., Ltd.	A subsidiary of the Company
JOY CITY DEVELOPMENTS LIMITED	A subsidiary of the Company
SWISS GOOD ENTERPRISES LIMITED	A subsidiary of the Company
BLESS WINNER LIMITED	A subsidiary of the Company
LOTES SUZHOU CO., LTD.	A subsidiary of the Company
WANGDEN INVESTMENTS LIMITED	A subsidiary of the Company
TSONGKHA TECHNOLOGY (SHENZHEN) CO., LTD.	A subsidiary of the Company
EMEME ROBOT CO., LTD.	A subsidiary of the Company (Note 2)
COMPERTUM MICROSYSTEMS INC.	A subsidiary of the Company
GOOD NEWS MEDICAL CO., LTD.	A subsidiary of the Company
FELICITY NEWS LIMITED	A subsidiary of the Company
JIASHIMEI (GUANGZHOU) Trading Co., Ltd.	A subsidiary of the Company
LINTES TECHNOLOGY CO., LTD.	A subsidiary of the Company
BLOOMING CHANCE LIMITED	A subsidiary of the Company
RADIANT DAY LIMITED	A subsidiary of the Company
LINTES TECHNOLOGY (SUZHOU) CO., LTD.	A subsidiary of the Company
GENIE Precision Machining CO., LTD.	A subsidiary of the Company
LINTES TECHNOLOGY (THAILAND) CO.,LTD	A subsidiary of the Company
LeRain Technology Co., Ltd.	An associate of the Company
I-SEE VISION TECHNOLOGY INC.	An associate of the Company
AionChip Technologies CO., LTD.	An associate of the Company
Key management	Including the directors, managers and their families and spouses

Note 1: Jiayou Investment Co., Ltd. was dissolved on November 17, 2025.
Note 2: EMEME ROBOT CO., LTD. was dissolved on July 11, 2025 and the liquidation has been completed.

Notes to the Parent Company Only Financial Statements

(3) Material transactions with related parties

Operating revenue

Significant sales to related parties are as follows:

	2025	2024
LOTESPEED TECHNOLOGY GUANGZHOU LTD.	$ 2,992,900	797,530
Other subsidiaries	505,036	36,612
	$ 3,497,936	834,142

The sales terms for transactions with the Company's subsidiaries are not significantly different from those for general customers. The collection period ranges from three to four months. No collateral was obtained for receivables from related parties.

Purchases

Purchases from related parties are as follows:

	2025	2024
JOY CITY DEVELOPMENTS LIMITED	$ 1,498,996	1,431,309
SWISS GOOD ENTERPRISES LIMITED	11,185,250	10,988,671
LOTES VIET NAM COMPANY LIMITED	1,308,935	569,206
LOTES ZHONGSHAN CO., LTD.	1,403,322	431,785
LOTES GUANGZHOU CO., LTD.	837,263	215,673
Other subsidiaries	170,817	53,883
Associates	189	47
	$ 16,404,772	13,690,574

The purchase prices from the above parties are not significantly different from those from third-party suppliers. The payment terms are three months, which are not significantly different from those offered by general suppliers.

Amounts due from related parties

Details of amounts due from related parties are as follows:

Item	Related party categories	Dec. 31, 2025	Dec. 31, 2024
Accounts receivable	LOTESPEED TECHNOLOGY GUANGZHOU LTD.	$ 1,426,309	794,780
Accounts receivable	SWISS GOOD ENTERPRISES LIMITED	296,707	7,342
Accounts receivable	COMPERTUM MICROSYSTEMS INC.	-	3,838
Accounts receivable	Other subsidiaries	458	46
Other receivables	LOTES GUANGZHOU CO., LTD. (註)	2,255	-
		$ 1,725,729	806,006

Note: The balance of other receivables includes loans to LOTES GUANGZHOU CO., LTD. amounting to NT$2,248 thousand as of December 31, 2025. Loans to subsidiaries are interest-bearing at a rate of 2.3%, based on the borrowing rate of the subsidiary from financial institutions in the year of disbursement. Interest income recognized for the year ended December 31, 2025 amounted to NT$7 thousand.

Notes to the Parent Company Only Financial Statements

Amounts due to related parties

Details of amounts due to related parties are as follows:

Item	Related party categories	Dec. 31, 2025	Dec. 31, 2024
Accounts payable	SWISS GOOD ENTERPRISES LIMITED	$ 4,856,603	4,967,844
Accounts payable	LOTES ZHONGSHAN CO., LTD.	542,633	429,806
Accounts payable	LOTES VIET NAM COMPANY LIMITED	609,399	286,624
Accounts payable	LOTES GUANGZHOU CO., LTD.	381,724	214,655
Accounts payable	Other subsidiaries	301,644	305,197
Accounts payable	Associates	-	33
Other payables	Lotes USA, Inc.	7,855	7,426
Other payables	Other subsidiaries	135	-
Other payables	Associates	13	-
		$ 6,700,006	6,211,585

Endorsements and guarantees

The balances and details of endorsements and guarantees provided by the Company to related parties are as follows:

	Dec. 31, 2025	Dec. 31, 2024
LOTES GUANGZHOU CO., LTD.	$ -	163,925
LOTES VIET NAM COMPANY LIMITED	157,150	163,925
LOTES SHENZHEN CO., LTD.	269,760	-
	$ 426,910	327,850

Selling expenses

	2025	2024
Other subsidiaries	4,912	4,193
Associates	12	85
	$ 4,924	4,278

Primarily sample expenses and material costs.

Administrative expenses

	2025	2024
Other subsidiaries	$ 128,096	78,319
Associates	-	22
	$ 128,096	78,341

Primarily service fees and labor service expenses.

Notes to the Parent Company Only Financial Statements (Continued)

Research and development expenses

	2025	2024
Other subsidiaries	$ -	11
Associates	-	4
	$ -	15

Primarily R&D material costs.

Non-operating income

	2025	2024
Other subsidiaries	$ 3,048	6,878
Associates	1,458	147
	$ 4,506	7,025

Mainly includes rental income from leasing parking spaces and office premises, interest income from loans to subsidiaries, sample income, royalty income, and others.

Lease liabilities and right-of-use assets

The Company leases a warehouse from key management personnel and entered into a one-year lease contract with reference to market rental rates for warehouses in nearby areas, with a total contract value of NT$60 thousand. Interest expenses recognized for the years ended December 31, 2025 and 2024 were NT$2 thousand and NT$1 thousand, respectively. The balances of lease liabilities as of December 31, 2025 and 2024 were NT$59 thousand and NT$0 thousand, respectively.

(4) Major management personnel transactions

Related compensation includes:

	2025	2024
Short-term employee benefits	$ 69,297	53,606
Post-employment benefits	804	934
Share-based payment	3,422	-
	$ 73,523	54,540

For details on share-based payments, please refer to note 6 (19).

Notes to the Parent Company Only Financial Statements (Continued)

VIII. Pledged Assets

The carrying value of the assets pledged as collateral by the Company was as follows:

Name of Asset	Pledged as Collateral for	Dec. 31, 2025	Dec. 31, 2024
Time deposits (recorded under other financial assets – current)	Customs duties guarantee	$ 205	-
Property, plant and equipment (Note)	Bank borrowings	39,200	40,103
Investment property (Note)	Bank borrowings	155,322	159,288
		$ 194,727	199,391

Note: Certain loan agreements have expired and were not renewed, and clearance certificates have been obtained from the banks; however, the deregistration procedures for the pledged assets have not yet been completed.

IX. Significant Contingent Liabilities and Unrecognized Contractual Commitments

(1) Significant unrecognized contract commitments:

The significant unrecognized contractual commitments of the Company are as follows:

Property, plant and equipment	Dec. 31, 2025
	$ 15,714

(2) The issuance of guarantee notes for bank loans, financing lines and derivative financial commodity transactions:

Guaranteed notes	Dec. 31, 2025	Dec. 31, 2024
	$ 2,800,050	3,650,765

X. Significant Disaster Loss: None.
XI. Significant Post-Period Events: None.

Notes to the Parent Company Only Financial Statements (Continued)

XII. Others

(1) Employee benefits, depreciation, depletion, and amortization functions are summarized below:

| Function
Nature | 2025 | | | 2024 | | |
| --- | --- | --- | --- | --- | --- | --- |
| | Operating cost | Operating expense | Total | Operating cost | Operating expense | Total |
| Employee benefit expense | | | | | | |
| Salary | 23,312 | 402,413 | 425,725 | 21,030 | 376,601 | 397,631 |
| Labor insurance and health insurance | 1,661 | 19,908 | 21,569 | 1,527 | 16,052 | 17,579 |
| Pension | 534 | 8,841 | 9,375 | 542 | 8,051 | 8,593 |
| Compensation of directors | - | 9,813 | 9,813 | - | 5,213 | 5,213 |
| Other employee benefit | 2,854 | 21,065 | 23,919 | 2,364 | 15,446 | 17,810 |
| Depreciation | 268 | 12,824 | 13,092 | 271 | 11,783 | 12,054 |
| Amortization | - | 20,244 | 20,244 | 2 | 22,137 | 22,139 |

Additional information on the number of employees and employee benefits expenses for the years ended December 31, 2025 and 2024 is as follows:

	2025	2024
Number of employees	181	162
Number of directors not concurrently serving as employees	5	5
Average employee benefits expense	$ 2,731	2,813
Average employee salary expense	$ 2,419	2,533
Changes in average employee salary expense	(4.50)%

The Company's compensation policies (including those for directors, managers, and employees) are as follows:

Directors' remuneration is distributed in accordance with the Company's regulations governing directors' remuneration.
Bonuses and incentives for managers and employees are determined based on the Company's operating performance, as well as individual roles and performance.
Salary adjustments are made in a timely manner for changes in performance or job responsibilities to reflect corresponding duties.

Notes to the Parent Company Only Financial Statements (Continued)

XIII. Disclosing Information

(1) Information on Major Transactions

In accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers,” the major transaction information of the Company for the year ended December 31, 2025, is disclosed as follows:

Financings provided:

Unit: NT$ thousands

No.	Lender	Borrower	Item	Related party	Max amount for the period	Closing balance	Actual amount	Interest rate	Nature of the lending (Note 1)	Transaction amount	Purpose for lending	Allowance for bad debt	Collected		Lending limit for single party (Note 2)	Overall lending limit (Note 2)
													Name	Value
1	Lotes Co., Ltd.	LOTES GUANGZHOU CO., LTD.	Other receivables-related parties	Yes	2,248	2,248	2,248	2.30%	2	-	Operating turnover	-	None	-	7,686,768	15,377,537
2	LINTES TECHNOLOGY CO., LTD.	GENIE Precision Machining CO., LTD.	Other receivables-related parties	Yes	120,000	60,000	45,000	1.89%	2	-	Operating turnover, non repayment	-	None	-	344,523	1,378,091
3	LINTES TECHNOLOGY CO., LTD.	LINTES TECHNOLOGY (THAILAND) CO., LTD.	Other receivables-related parties	Yes	66,410	62,860	47,145	2.00%–2.55%	2	-	Operating turnover	-	None	-	344,523	1,378,091

Note 1: The following are the descriptions of the funds lending.

(1) Those who have business dealings.
(2) When there is a need for short-term financing.

Note 2: (1) The amount of the Company’s financing to a single party shall not exceed 20% of the Company’s net worth.

The total amount of funds lent by the Company to others shall not exceed 40% of the Company’s net worth.

(2) Lintes Technology Co., Ltd. must not lend more than 10% of its net value to a single entity.

Lintes Technology Co., Ltd.'s total amount of funds lent to others must not exceed 50% of its net value.

a. For those with business transactions, the total amount of funds lent must not exceed 10% of the company's net value.
b. For those needing short-term funding, the total amount of funds lent must not exceed 40% of the company's net value.

Notes to the Parent Company Only Financial Statements (Continued)

2. Endorsement/guarantee provided

Unit: NT$ thousands/外幣千元

No.	Endorsement provider	Endorser		Ceiling on amount of endorsement for an unroyalize clause	Balance of the ceiling endorsement for in the period	Ending balance of the endorsement fee	Amount actually used	Amount of endorsements and guarantees secured by property	Percentage of the accumulated amount of endorsement in the net value of current financial statement (%)	Ceiling on amount of endorsement (Note 2)	Endorsement made by parent company is subsidiary	Endorsement made by subsidiary is parent company	Endorsement made to any party in Mainland China
		Company Name	Relationship (Note 1)
0	Lotes Co., Ltd.	LOTES GUANGZHOU CO., LTD.	2	7,688,768	166,625 (US$59,900)	-	-	-	-	19,221,921	Yes	No	Yes
0	"	LOTES VIET NAMI COMPANY LIMITED	2	7,688,768	166,625 (US$59,900)	157,150 (US$59,900)	-	-	0.41%	19,221,921	"	"	No
0	"	LOTES MIENDIEN CO., LTD.	2	7,688,768	269,740 (CNY40,000)	269,740 (CNY40,000)	-	-	0.70%	19,221,921	"	"	Yes
1	LINTES TECHNOLOGY CO., LTD.	GENIE Precision Machining CO., LTD.	2	1,722,614	130,000	130,000	5,000	-	3.77%	3,445,227	"	"	No

Note 1: There are seven types of relationship between the Endorser and Endorsee, which can be marked:

(1) Companies with business dealings.
(2) Companies in which the company directly and indirectly holds more than 50% of the voting rights.
(3) Companies that hold more than 50% of the voting rights in the company, both directly and indirectly.
(4) The Company owns, directly and indirectly, more than 90 percent of the voting shares.
(5) Company that is mutually insured under a contract between its peers or co-manufacturers based on the need to perform the work.
(6) Company in which all of the contributory shareholders have given their endorsement in proportion to their shareholding in the joint venture.
(7) Intercompany performance guarantees and guarantees for pre-sale contracts in accordance with the Consumer Protection Act.

Note 2: (1) The amount of the Company's guarantee for a single corporate endorsement shall not exceed 20% of the net worth of the Company.

The aggregate amount of the Company's guarantees under external endorsement shall not exceed 50% of the net worth of the Company.

(2) The amount of Lotes Guanghou Co., Ltd's guarantee for a single corporate endorsement is limited to not more than 20% of the net worth of the company.

The aggregate amount of Lotes Guanghou Co., Ltd's external endorsement guarantees is limited to an amount not exceeding 50% of the Company's net worth.

(3) The amount of Lintes Technology Co., Ltd.'s guarantee for a single corporate endorsement is limited to not more than 50% of the net worth of the company.

The aggregate amount of Lintes Technology Co., Ltd.'s external endorsement guarantees is limited to an amount not exceeding 100% of the Company's net worth.

Notes to the Parent Company Only Financial Statements (Continued)

Major marketable securities held (excluding the equity of controlled by subsidiaries, affiliated companies, or joint company):

Unit: NT$ thousands

Holding company	Category and name of security	Relationship with the issuer of the security	Accounting item	End of the period
				Shares	Book value	Shareholding ratio	Fair value
Lotes Co., Ltd.	Taiwan Semiconductor Manufacturing Company Limited	None	Financial assets measured at FVTPL - current	400,000	620,000	0.00%	620,000
"	Hon. Precision, Inc.	None	"	45,000	154,125	0.03%	154,125
"	Phoenix VI Capital Venture Capital Co., Ltd.	None	Financial assets measured at FVTOCI - non-current	9,000,000	120,167	4.57%	120,167

Note: This table discloses marketable securities with a carrying amount of NT$100 million or more.

The amount of sales to or from related parties is at least $100 million or 20% of the paid-in capital:

Unit: NT$ thousands

The company which purchases (sells) products	Name of transaction counterparty	Relationship	Transaction status				Situation and reason for the conditions of transaction to be different from the ordinary ones		Notes and accounts receivable (payable)
			Purchases (sales)	Amount	Percentage in total goods purchased (sold)	Credit period	Unit price	Credit period	Balance	Percentage in the notes and accounts receivable (payable)
Lotes Co., Ltd.	LOTESPEED TECHNOLOGY GUANGZHOU LTD	Subsidiary	Net sales	2,992,900	12.46 %	IOM 90 days	-	No significant difference	1,426,309	14.88%
"	SWISS GOOD ENTERPRISES LIMITED	"	Net sales	503,473	2.10 %	"	-	"	296,707	3.10%
LOTES GUANGZHOU CO., LTD.	Lotes Co., Ltd.	The ultimate parent company	Net sales	837,263	9.63 %	"	-	"	381,724	10.52%
"	LOTESPEED TECHNOLOGY GUANGZHOU LTD	Subsidiary	Net sales	152,335	1.75 %	"	-	"	80,657	2.22%
"	SWISS GOOD ENTERPRISES LIMITED	The ultimate parent company is the same company	Net sales	6,437,168	74.07 %	"	-	"	2,214,320	61.03%
LOTES SUZHOU CO., LTD	LOTES SHENZHEN CO., LTD.	"	Net sales	121,559	5.53 %	"	-	"	48,350	8.71%
"	Sky Comet Zhongshan Electronics Co., Ltd.	"	Net sales	128,681	5.86 %	"	-	"	89,242	16.08%
"	JOY CITY DEVELOPMENTS LIMITED	"	Net sales	1,618,145	73.64 %	"	-	"	288,873	52.06%
LOTES HENGNAN CO., LTD.	Lotes Co., Ltd.	The ultimate parent company	Net sales	140,620	4.67 %	"	-	"	41,084	3.62%
"	LOTES GUANGZHOU CO., LTD.	Parent company	Net sales	412,755	13.71 %	"	-	"	142,869	12.59%
"	LOTES ZHONGSHAN CO., LTD.	The ultimate parent company is the same company	Net sales	352,579	11.71 %	"	-	"	160,815	14.17%
"	LOTES SHENZHEN CO., LTD.	"	Net sales	344,377	11.44 %	"	-	"	153,503	13.53%
"	TSONGKHA TECHNOLOGY (SHENZHEN) CO., LTD.	"	Net sales	401,586	13.34 %	"	-	"	162,120	14.29%
"	SWISS GOOD ENTERPRISES LIMITED	"	Net sales	1,282,219	42.58 %	"	-	"	444,755	39.20%
LOTES ZHONGSHAN CO., LTD.	Lotes Co., Ltd.	The ultimate parent company	Net sales	1,403,322	13.12 %	"	-	"	542,633	12.07%
"	LOTES GUANGZHOU CO., LTD.	Parent company	Net sales	865,611	8.09 %	"	-	"	378,440	8.42%

Notes to the Parent Company Only Financial Statements

The company which purchases (sells) products	Name of transaction counterparty	Relationship	Transaction status				Situation and reason for the conditions of transaction to be different from the ordinary ones		Notes and accounts receivable (payable)
			Purchases (sales)	Amount	Percentage in total goods purchased (sold)	Credit period	Unit price	Credit period	Balance	Percentage in the notes and accounts receivable (payable)
LOTES ZHONGSHAN CO., LTD.	LOTES SHENZHEN CO., LTD.	The ultimate parent company is the same company	Net sales	142,506	1.33 %	EOM 90 days	-	No significant difference	92,097	2.05%
"	LOTESPEED TECHNOLOGY GUANGZHOU LTD	"	Net sales	927,312	8.67 %	"	-	"	526,545	11.72%
"	Sky Comet Zhongshan Electronics Co., Ltd.	"	Net sales	327,937	3.07 %	EOM 180 days	-	"	254,325	5.66%
"	SWISS GOOD ENTERPRISES LIMITED	"	Net sales	6,845,654	64.00 %	EOM 90 days	-	"	2,303,512	51.25%
LINTES TECHNOLOGY (SUZHOU) CO., LTD.	Lintex Technology Co., Ltd.	"	Net sales	816,238	82.67 %	"	-	"	268,358	72.82%
Zhongshan Dezhi Metal Surface Treatment Co., Ltd.	LOTES GUANGZHOU CO., LTD.	Parent company	Net sales	571,642	76.43 %	"	-	"	98,869	72.82%
"	LOTES ZHONGSHAN CO., LTD.	The ultimate parent company is the same company	Net sales	164,014	21.93 %	"	-	"	24,817	19.89%
LOTES VIET NAM COMPANY LIMITED	Lotes Co., Ltd.	Parent company	Net sales	1,308,935	95.65 %	"	-	"	609,399	100.00%
LOTESPEED TECHNOLOGY GUANGZHOU LTD	LOTES SHENZHEN CO., LTD.	The ultimate parent company is the same company	Net sales	1,622,248	37.43 %	"	-	"	871,066	40.66%
"	TSONGKHA TECHNOLOGY (SHENZHEN) CO., LTD.	"	Net sales	1,499,534	34.60 %	"	-	"	657,835	30.71%
"	SWISS GOOD ENTERPRISES LIMITED	"	Net sales	302,558	6.98 %	"	-	"	121,588	5.68%
SWISS GOOD ENTERPRISES LIMITED	Lotes Co., Ltd.	The ultimate parent company	Net sales	11,185,250	71.82 %	"	-		4,856,603	72.65%
"	LOTES VIET NAM COMPANY LIMITED	The ultimate parent company is the same company	Net sales	103,468	0.66 %	"	-		62,751	0.94%
"	Sky Comet Zhongshan Electronics Co., Ltd.	"	Net sales	443,685	2.85 %	EOM 180 days	-		348,478	5.21%
JOY CITY DEVELOPMENTS LIMITED	Lotes Co., Ltd.	The ultimate parent company	Net sales	1,498,996	91.96 %	EOM 90 days	-		237,789	82.87%
"	SWISS GOOD ENTERPRISES LIMITED	The ultimate parent company is the same company	Net sales	125,045	7.67 %	"	-		49,221	17.15%

Notes to the Parent Company Only Financial Statements

Amounts due from related parties amounting to at least NT$100 million or 20% of paid-in capital:

Unit: NT$ thousands

Related party with accounts receivable by the Company	Name of transaction counterparty	Relationship	Balance of receivables from the related party	Turnover ratio	Past due receivables from the related party		Amounts due from related parties recovered after the period	Allowance for losses
					Amount	Handling
Lotes Co., Ltd.	LOTESPED TECHNOLOGY GUANGZHOU LTD	Subsidiary	1,426,309	2.69	-		-	-
"	SWISS GOOD ENTERPRISES LIMITED	"	296,707	3.31	-		-	-
LOTES GUANGZHOU CO., LTD.	Lotes Co., Ltd.	The ultimate parent company	381,724	2.81	-		71,752	-
"	LOTES ZHONGSHAN CO., LTD.	Subsidiary	687,489	-	-		284,161	-
"	SWISS GOOD ENTERPRISES LIMITED	The ultimate parent company is the same company	2,214,320	2.48	-		624,233	-
LOTES SUZHOU CO., LTD.	JOY CITY DEVELOPMENTS LIMITED	"	288,873	5.55	-		247,890	-
LOTES HENGNAN CO., LTD.	LOTES GUANGZHOU CO., LTD.	Parent company	142,869	2.81	-		39,411	-
"	LOTES ZHONGSHAN CO., LTD.	The ultimate parent company is the same company	160,815	2.69	-		36,738	-
"	LOTES SHENZHEN CO., LTD.	"	153,503	2.62	-		28,837	-
"	TSONGKHA TECHNOLOGY (SHENZHEN) CO., LTD.	"	162,120	2.80	-		41,589	-
"	SWISS GOOD ENTERPRISES LIMITED	"	444,755	4.10	-		125,954	-
LOTES ZHONGSHAN CO., LTD.	Lotes Co., Ltd.	The ultimate parent company	542,633	2.89	-		112,144	-
"	LOTES GUANGZHOU CO., LTD.	Parent company	378,440	2.40	-		109,859	-
"	LOTESPED TECHNOLOGY GUANGZHOU LTD	The ultimate parent company is the same company	526,545	2.14	-		86,752	-
"	Sky Comet Zhongshan Electronics Co., Ltd.	"	254,325	1.51	-		30,632	-
"	SWISS GOOD ENTERPRISES LIMITED	"	2,303,512	3.08	-		509,241	-
LINTES TECHNOLOGY (SUZHOU) CO., LTD.	Lintes Technology Co., Ltd.	"	268,358	1.59	12,629	Continuous collection	126,567	-
LOTES VIET NAM COMPANY LIMITED	Lotes Co., Ltd.	Parent company	609,399	2.92	-		108,837	-
LOTESPED TECHNOLOGY GUANGZHOU LTD	LOTES SHENZHEN CO., LTD.	The ultimate parent company is the same company	871,066	2.32	-		197,923	-
"	TSONGKHA TECHNOLOGY (SHENZHEN) CO., LTD.	"	657,835	2.84	-		99,959	-
"	SWISS GOOD ENTERPRISES LIMITED	"	121,588	3.11	-		5,604	-
SWISS GOOD ENTERPRISES LIMITED	Lotes Co., Ltd.	The ultimate parent company	4,856,603	2.28	-		1,214,118	-
"	LOTES GUANGZHOU CO., LTD.	The ultimate parent company is the same company	338,151	-	-		156,086	-
"	LOTES ZHONGSHAN CO., LTD.	"	674,008	-	-		543	-
"	LOTES VIET NAM COMPANY LIMITED	"	158,684	-	-		-	-
"	Sky Comet Zhongshan Electronics Co., Ltd.	"	348,478	1.60	-		51,996	-
JOY CITY DEVELOPMENTS LIMITED	Lotes Co., Ltd.	The ultimate parent company	237,789	6.04	-		-	-
GOOD HOPE INVESTMENTS LIMITED	SWISS GOOD ENTERPRISES LIMITED	Subsidiary	971,848	-	-		-	-

Notes to the Parent Company Only Financial Statements

(2) Information on reinvestment business:

The Company's reinvestment information (excluding investees in China) for the year ended December 31, 2025, is as follows:

Unit: NT$ thousands

Name of the company investing	Name of investee company	Location	Main business	Initial investment amount (Note 1)		Shares held at the end of the fiscal period			Cum/loss of investee company in the fiscal period	Cum/loss in the investment recognized in the fiscal period	Remarks
				End of this period	End of the previous year	Shares	Percentage	Book value
Lines Co., Ltd.	LOTES INVESTMENTS LIMITED	Saman	Holding and investment	818,752	838,752	26,050,000	100.00%	14,954,909	1,964,585	1,926,102	Note 2
*	GOOD HOPE INVESTMENTS LIMITED	"	"	12,612	12,612	401,201	100.00%	2,406,786	163,126	163,126
*	CROWN MIND DEVELOPMENTS LIMITED	"	"	629,116	629,116	20,016,426	100.00%	6,745,877	1,024,830	1,039,366	Note 2
*	TASER INVESTMENTS LIMITED	Anguilla	"	15,715	15,715	500,000	100.00%	323,066	63,103	63,103
*	Jinyou Investment Co., Ltd.	Taiwan	"	-	865,000	-	%	-	26,137	26,166	Note 2 - 3
*	COMPORTUM MICROSYSTEMS INC.	"	Manufacturing of electronic components	102,389	-	8,483,248	33.56%	14,800	(49,216)	(789)
*	GOOD NEWS MEDICAL CO., LTD.	"	Manufacturing and sales of machinery and equipment, electronic components, and optical instruments	15,324	-	1,532,419	30.65%	5,916	(7,127)	(451)
*	LINTES TECHNOLOGY CO., LTD.	"	Manufacturing of electronic components and other electrical and electronic machinery and equipment	746,361	-	32,071,309	40.56%	1,670,986	119,097	12,674	Note 2
*	LOTES USA, Inc.,	USA	Market development	78,575	78,575	2,500,000	100.00%	99,952	3,940	3,940
*	LOTES EU GmbH	Germany	"	3,690	3,690	100,000	100.00%	5,844	(181)	(181)
*	LeRain Technology Co., Ltd.	Taiwan	Design, test and sale of ships	47,221	47,221	4,722,059	14.83%	42,742	10,693	1,665
*	Lontes Co., Ltd.	"	Manufacturing and trading of mechanical equipment and electronic parts	159,700	124,800	15,970,000	99.81%	75,438	(19,544)	(19,517)
*	I-SEE VISION TECHNOLOGY INC.	"	Design, research and development, and manufacturing services for contact lenses	158,301	94,000	8,780,123	22.41%	64,133	(106,629)	(25,950)
*	AsiaChip Technologies CO., LTD.	"	Design, test and sale of ships	95,727	95,727	5,264,980	26.32%	62,109	(61,247)	(16,123)
*	LOTES VIET NAM COMPANY LIMITED	Vietnam	Manufacturing of connectors for the information industry, communications industry, and consumer electronics industry	3,823,942	2,883,042	121,729,000	100.00%	3,703,473	170,164	173,251	Note 2
LOTES INVESTMENTS LIMITED	LOTESON INTERNATIONAL INVESTMENTS LTD.	Hong Kong	Holding and investment	818,752	818,752	26,050,000	100.00%	15,442,647	1,964,585	1,964,585
GOOD HOPE INVESTMENTS LIMITED	JINY CITY DEVELOPMENTS LIMITED	Saman	Sales of connectors for the information industry, communications industry, and consumer electronics industry	3,143	3,143	100,000	100.00%	1,553	111	111
*	SWISS GOOD ENTERPRISES LIMITED	Hong Kong	"	3,183	3,183	101,281	100.00%	1,433,356	163,015	163,015
CROWN MIND DEVELOPMENTS LIMITED	BLESS WINNER LIMITED	"	Holding and investment	629,127	629,127	20,016,756	100.00%	6,778,671	1,024,830	1,024,830
TASER INVESTMENTS LIMITED	WANSDEN INVESTMENTS LIMITED	"	Holding and investment	15,715	15,715	500,000	100.00%	323,066	63,103	63,103
Jinyou Investment Co., Ltd.	COMPORTUM MICROSYSTEMS INC.	Taiwan	Manufacturing of electronic components	-	77,852	-	%	-	-	(14,324)	Note 3
*	LINTES TECHNOLOGY CO., LTD.	"	Manufacturing and sales of machinery and equipment, electronic components, and optical instruments	-	9,552	-	%	-	-	(1,564)	Note 3
*	LINTES TECHNOLOGY CO., LTD.	"	Manufacturing of electronic components and other electrical and electronic machinery and equipment	-	746,361	-	%	-	-	42,929	Note 3
GOOD NEWS MEDICAL CO., LTD.	FELICITY NEWS LIMITED	British Virgin Islands	Holding and investment	1,037	1,037	33,000	100.00%	985	(27)	(27)
LINTES TECHNOLOGY CO., LTD.	GENIE Precision Machining CO., LTD.	Taiwan	Manufacturing and sales of optical molds	103,872	164,833	9,245,132	51.01%	91,596	(4,229)	(6,380)
*	COMPORTUM MICROSYSTEMS INC.	"	Manufacturing of electronic components	30,965	25,938	2,511,820	9.94%	4,584	(49,216)	(4,991)
LINTES TECHNOLOGY CO., LTD.	LeRain Technology Co., Ltd.	Taiwan	Design, test and sale of ships	5,201	5,471	520,059	1.63%	4,707	10,693	194
*	AsiaChip Technologies CO., LTD.	"	"	11,764	11,764	647,020	3.24%	7,403	(61,247)	(1,981)
*	BLOOMING CHANCE LIMITED	Saman	Holding and investment	155,579	155,579	4,950,000	100.00%	458,255	20,969	14,089	Note 2
*	LINTES TECHNOLOGY (THAILAND) CO., LTD.	Thailand	Manufacturing of electronic components and other electrical and electronic machinery and equipment	559,300	529,311	57,100,000	100.00%	443,506	(57,216)	(57,216)
BLOOMING CHANCE LIMITED	BADEAST DAY LIMITED	Saman	Holding and investment	155,579	155,579	4,950,000	100.00%	458,250	20,964	14,084	Note 2

Note 1: Original investment amounts are translated into New Taiwan Dollars based on the exchange rates as of the balance sheet date.
Note 2: The investment profit or loss recognized in the current period includes adjustments for unrealized gains or losses from intercompany transactions within the Company.
Note 3: Jiayou Investment Co., Ltd. was merged under a simplified merger on November 17, 2025, with the Company as the surviving entity.

Notes to the Parent Company Only Financial Statements

(3) Information on Investment in China:

Names of investee companies in Mainland China, major business activities, and other related information:

Unit: NT$ thousands

Investee Company	Main Businesses and Products	Paid-in capital (Note 3)	Method of Investment (Note 1)	Accumulated investment amount remitted from Taiwan at the beginning of the fiscal period (Note 3)	Investment Flows		Accumulated investment amount remitted from Taiwan at the end of the fiscal period (Note 3)	Gain/loss of investee company in the fiscal period	Percentage of Ownership	Shares of Profits / Losses (Note 3)	Carrying Amount at the beginning of the fiscal period	Accumulated $ Inward Remittance of Earnings as of the end of the fiscal period
					Outflow	Inflow
LOTES GUANGZHOU CO., LTD.	Manufacturing of connectors for the information industry, communications industry, and consumer electronics industry	839,181	(2)	801,465	-	-	801,465	1,964,585	100.00%	1,926,319	14,954,868	-
LOTES SUZHOU CO., LTD.	Manufacturing of connectors for the information industry, communications industry, and consumer electronics industry	628,261	(2)	628,261	-	-	628,261	1,024,829	100.00%	1,039,366	6,745,816	-
THONGKHA TECHNOLOGY SHENZHEN) CO., LTD.	R&D of electronics, import and export of raw materials of plastic products and plastic products	15,715	(2)	15,715	-	-	15,715	63,103	100.00%	63,103	323,064	-
LOTES HENGNAN CO., LTD.	Manufacturing of connectors for the information industry, communications industry, and consumer electronics industry	1,310,584	(3)	-	-	-	-	365,906	100.00%	395,133	2,574,402	-
LINTES TECHNOLOGY HUZHEN) CO., LTD.	Development and production of the measurement instruments for optical communication, optical transceivers of 10GBs or above and relevant technical support	155,579	(2)	155,579	-	-	155,579	24,917	48.56%	8,759	243,775	297,621
LOTES SHENZHEN CO., LTD.	Manufacturing of robotic arms, automation equipment and relevant components	112,400	(3)	-	-	-	-	76,661	100.00%	76,661	288,933	-
LOTES ZHONGSHAN CO., LTD.	Manufacturing connectors for telecommunication industry and for consumer electronics industry, and manufacturing of robotic arms, automation equipment and relevant components	3,147,200	(2)	-	-	-	-	1,198,121	100.00%	1,198,121	8,144,802	-
Zhongshan Dechi Metal Surface Treatment Co., Ltd.	Surface treatment of metal products and plastic products	274,256	(3)	-	-	-	-	8,148	100.00%	8,148	357,621	-
Loles (Hengnan) Business Development Co., LTD.	Development of real estate, lease of premises, landscape design and interior decorating	134,880	(3)	-	-	-	-	355	100.00%	(165)	133,754	-
Zhongshan Jinnucide Metal Surface Treatment Co., Ltd.	Surface treatment of metal products and plastic products	289,003	(3)	-	-	-	-	(941)	100.00%	(3,698)	338,121	-
Guangzhou Dechi Technology Co., Ltd.	Research and development, manufacturing, and sales of various types of equipment	2,248	(3)	-	-	-	-	(30)	100.00%	(30)	2,123	-
Zhongshan Dechi Real Estate Development Co., Ltd.	Development of real estate, lease of premises, landscape design and interior decorating	359,680	(3)	-	-	-	-	65	100.00%	(3,478)	343,845	-
LOTESPEED TECHNOLOGY GUANGZHOU LTD.	Research, testing and development	21,131	(3)	-	-	-	-	133,234	100.00%	133,234	460,738	-
CHONGGING FOISON ELECTRONIC TECHNOLOGY CO., LTD.	R&D and sales of electronic components, automobile components and accessories, computers and accessories, development of molds and the import and export of goods and technologies	7,194	(3)	-	-	-	-	6,311	51.00%	3,219	15,877	-
Sky Comet Zhongshan Electronics Co., Ltd.	Manufacturing of connectors for the information industry, communications industry, and consumer electronics industry	34,619	(3)	-	-	-	-	65,869	30.06%	19,803	23,039	-
Haili Electronics Technology (Ningbo) Co., Ltd.	Manufacturing of connectors for the information industry, communications industry, and consumer electronics industry	4,496	(3)	-	-	-	-	6,967	51.00%	3,553	3,869	-
JIAISHMEI (GUANGZHOU) Trading Co., Ltd.	Engaging in the manufacture and sale of audio equipment, Class II medical devices, mechanical equipment, electronic components, and optical instruments	1,037	(2)	1,037	-	-	1,037	(27)	100.00%	(27)	985	-

Note 1: There are six types of investments:

(1) Investment in Chinese Corporation via Third Region Remittance.
(2) Establishment of a company to reinvest in a continental company through a third regional investment.
(3) Reinvest in Chinese companies by re-investing in existing companies in third regions.
(4) Direct Investment
(5) Others.
(6) N/A.

Notes to the Parent Company Only Financial Statements

Note 2: (1) The investment gain or loss recognized in the current period has been reconciled with the unrealized gain or loss from intercompany transactions.

(2) Basis of recognition of investment income and loss is divided into the following four categories, which should be noted:

A. Financial statements audited by an international accounting firm with a cooperative relationship with the CPA firms in Taiwan
B. Financial statements audited by the parent company's certified accountant in Taiwan
C. Financial statements audited by the subsidiary's certified accountant in Taiwan
D. Other

Note 3: The balance sheet date exchange rates are used to translate the paid-in capital and remittance of cumulative investment amounts into New Taiwan dollars.

Limit on Investment in Mainland China:

Company Name	Accumulated Investment in Mainland China as of December 31, 2025 (Note 1)	Investment Amounts Authorized by Investment Commission, MOEA (Note 1)	Upper Limit on Investment
Lotes Co., Ltd.	$1,445,441 thousand	$1,597,914 thousand	$23,066,305 thousand
LINTES TECHNOLOGY CO., LTD.	$155,579 thousand	$155,579 thousand	$2,067,136 thousand
GOOD NEWS MEDICAL CO., LTD.	$1,037 thousand	$1,037 thousand	$11,580 thousand

Note 1: The conversions to NTD were made at the exchange rates prevailing on the balance sheet date.

Significant transactions with the investee companies in China:

For the year ended December 31, 2025, significant direct or indirect transactions with investee companies located in China (which have already been eliminated in the preparation of the Parent Company Only Financial Statements) are disclosed in the sections "Information on Major Transactions" in this report and "Business Relationships and Material Transactions Between Parent and Subsidiaries" in the Consolidated Financial Statements.

XIV. Segment Information

Please refer to the consolidated financial statements for the year ended December 31, 2025.

LOTES CO., LTD.

STATEMENT OF CASH AND CASH EQUIVALENTS

DECEMBER 31, 2025

Unit: NT$ thousands

Item	Description	Amount
Cash and cash equivalents:
Petty cash		$ 45
Checking accounts and demand deposits	NTD	465,259
	Foreign currencies (USD40,078,002.39, HKD20,746.34, JPY10,622.00, EUR629,611.26, RMB20,953,987.32 and THB1.67)	1,377,179
		1,842,438
	NTD
Time deposits	Maturity date: Jan 30, 2026
	Interest rate: 1.32%	100,000
	Foreign currencies (USD48,125,000, RMB25,000,000, EUR2,200,000 and JPY2,886,130,702)	2,285,684
	Maturity dates: Jan 1, 2026 ~ Jan 30, 2026
	Interest rates: 0.19% ~ 4.00%
		2,385,684
Total		$ 4,228,167

LOTES CO., LTD.
STATEMENT OF NOTES RECEIVABLE
DECEMBER 31, 2025 Unit: NT$ thousands

Item	Description	Amount
Non-related parties:
Company A		$ 1,117
Company B		272
Company C		143
Others (Note)		584
		$ 2,116

Note: The balance of each individual customer does not exceed 5% of the account balance and is therefore not separately presented.

STATEMENT OF ACCOUNTS RECEIVABLE

Item	Description	Amount
Related parties:
LOTESPEED TECHNOLOGY		$ 1,426,309
GUANGZHOU LTD.
SWISS GOOD ENTERPRISES		296,707
LIMITED
Others (Note)		458
		$ 1,723,474
Non-related parties:
Company D		$ 794,473
Company E		535,007
Company F		523,990
Company G		491,588
Others (Note)		5,515,164
Less: Allowance for loss		(1,572)
		$ 7,858,650

Note: The balance of each individual customer does not exceed 5% of the account balance and is therefore not separately presented.

LOTES CO., LTD.

STATEMENT OF OTHER RECEIVABLES

DECEMBER 31, 2025

Unit: NT$ thousands

Item	Description	Amount
Related parties:
LOTES GUANGZHOU CO., LTD.		$ 2,255
Non-related parties:
VAT refundable		$ 23,470
Other receivables – interest		8,248
Others	Mainly includes mold development income and receivables from the disposal of shares of LeRain Technology Co., Ltd..	596
Subtotal		32,314
Less: Allowance for loss		(246)
		$ 32,068

Note: The balance of each individual customer does not exceed 5% of the account balance and is therefore not separately presented.

STATEMENT OF INVENTORIES

Item	Amount	Market Value
Merchandise	$ 1,175,487	1,721,848
Finished goods	2,475	-
Work in process	-	-
Raw materials	12	2
Subtotal	1,177,974	1,721,850
Less: Allowance for inventory write-down and obsolescence	(63,554)
	$ 1,114,420

Note: The allowance for inventory write-down and obsolescence is determined based on the lower of cost or net realizable value and by considering the aging of inventories.

LOTES CO., LTD.
STATEMENT OF PREPAYMENTS
DECEMBER 31, 2025 Unit: NT$ thousands

Item	Description	Amount
Prepaid membership fees	Mainly prepaid annual membership fees	$ 961
Prepaid insurance	Mainly prepaid insurance expenses	2,553
Prepaid import VAT	Mainly prepaid VAT	4,580
Others (Note)	Mainly prepaid miscellaneous expenses	424
Total		$ 8,518
Current income tax assets		$ 66

Note: The balance of each individual customer does not exceed 5% of the account balance and is therefore not separately presented.

LOTES CO., LTD.
STATEMENT OF FINANCIAL ASSETS
MEASURED AT FAIR VALUE THROUGH
PROFIT OR LOSS - CURRENT
DECEMBER 31, 2025
Unit: Par value (NTD) / NT$ thousands

Name of financial instrument	Description	Number of shares	Par value	Total amount	Interest rate	Acquisition cost	Fair value
							Unit price	Total amount
Taiwan Semiconductor Manufacturing Company Limited	Listed (OTC) stock	400,000	$10	4,000	-	526,302	1,550	620,000
Hon. Precision, Inc.	Listed (OTC) stock	45,000	10	450	-	86,350	3,425	154,125
GRAND-TEK TECHNOLOGY CO., LTD.	Listed (OTC) stock	392,815	10	3,928	-	9,276	64	25,297
Lian Hong Art Company Limited	Emerging stock	1,143,154	10	11,432	-	62,587	18	20,257
Invesco QQQ Trust	Beneficiary certificates of funds	600	-	-	-	10,117	19,308	11,585
OTO PHOTONICS INC.	Non-listed (OTC) stock	1,368,800	10	13,688	-	25,534	-	-
LUCEMITEK CO., LTD.	Non-listed (OTC) stock	420,000	10	4,200	-	11,700	-	-
RADINET COMMUNICATIONS INC.	Non-listed (OTC) stock	1,169,977	10	11,700	-	4,200	-	-
						720,166		831,264

LOTES CO., LTD.
STATEMENT OF CHANGES IN FINANCIAL ASSETS MEASURED AT FAIR VALUE THROUGH PROFIT OR LOSS - NON-CURRENT
FOR THE YEAR ENDED DECEMBER 31, 2025 Unit: Par value (NT$ thousands) / NT$ thousands

	Opening balance		Increase		Decrease		Closing balance
Name of financial instrument	Number of shares	Fair value	Number of shares	Amount	Number of shares	Amount	Number of shares	Fair value	Endorsements or guarantees provided	Remarks
Overseas bonds	6,100$	170,044	-	2,315	-	-	6,100	172,359	None
Private equity funds	-	59,964	-	14,909	-	-	-	74,873	"
	$	230,008		17,224		-		247,232

STATEMENT OF FINANCIAL ASSETS MEASURED AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME - NON-CURRENT
FOR THE YEAR ENDED DECEMBER 31, 2025 Unit: Thousands of shares / NT$ thousands

Name	Opening balance		Increase (Note 1)		Decrease (Note 1)		Closing balance		Accumulated impairment	Endorsements or guarantees provided
	Number of shares	Fair value	Number of shares	Amount	Number of shares	Amount	Number of shares	Fair value
G-sas Co.,Ltd	300	$ 15				(15)	300			None
Phoenix VI	9,000	87,825	-	32,342	-	-	9,000	120,167	-	"
Capital Venture
Capital Co., Ltd.
Phoenix VII	-	-	5,000	52,352	-	-	5,000	52,352	-	"
Capital Venture
Capital Co., Ltd.
UPBEAT	900	15,876	-	-		(12,125)	900	3,751	-	"
TECHNOLOGY
Co., Ltd.
RATIONAL	-	-	500	10,000	-	-	500	10,000	-	"
PRECISION
INDUSTRIAL
CO., LTD.
Ying Hsi	-	-	1,000	12,870	-	-	1,000	12,870		"
Innovation
Venture Capital
Corporation
	$	103,716		107,564		(12,140)		199,140	-

Note 1: The amount includes additions of NT$70,000 thousand during the current period and unrealized gains of NT$25,424 thousand on financial assets measured at fair value through other comprehensive income.

LOTES CO., LTD.
STATEMENT OF CHANGES IN INVESTMENTS
ACCOUNTED FOR USING THE EQUITY METHOD
FOR THE YEAR ENDED DECEMBER 31, 2025
Unit: NT$ thousands

Name	Opening balance		Increase (Note 1)		Decrease (Note 1)		Closing balance			Equity		Endorsements or guarantees provided
	Number of shares	Amount	Number of shares	Amount	Number of shares	Amount	Number of shares	% of ownership	Amount	Unit price	Total amount
Lotes Investment Limited	26,050,000	$ 12,901,369	-	2,053,540	-	-	26,050,000	100.00%	14,954,909	-	14,954,909	None
GOOD HOPE INVESTMENTS LIMITED	401,281	2,338,976	-	67,808	-	-	401,281	100.00%	2,406,784	-	2,406,784	"
CROWN MIND DEVELOPMENTS LIMITED	20,016,426	5,645,231	-	1,100,646	-	-	20,016,426	100.00%	6,745,877	-	6,745,877	"
TASHI INVESTMENTS LIMITED	500,000	256,566	-	66,498	-	-	500,000	100.00%	323,064	-	323,064	"
Jiayou Investment Co., Ltd.	94,300,000	1,811,958	-	-	94,300,000	1,811,958	-	-	-	-	-	"
COMPERTUM MICROSYSTEMS INC.	-	-	8,483,248	14,808	-	-	8,483,248	33.56%	14,808	-	14,808	"
GOOD NEWS MEDICAL CO., LTD.	-	-	1,532,419	5,916	-	-	1,532,419	30.65%	5,916	-	5,916	"
LINTES TECHNOLOGY CO., LTD.	-	-	32,071,309	1,670,984	-	-	32,071,309	48.56%	1,670,984	-	1,670,984	"
Lotes USA. Inc.	2,500,000	98,832	-	1,120	-	-	2,500,000	100.00%	99,952	-	99,952	"
LOTES EU GmbH	100,000	5,046	-	798	-	-	100,000	100.00%	5,844	-	5,844	"
LeRain Technology Co., Ltd.	4,732,059	34,259	-	8,833	10,000	350	4,722,059	14.83%	42,742	-	42,742	"
Lomites Co., Ltd.	12,480,000	60,034	349,000	15,404	-	-	12,829,000	99.81%	75,438	-	75,438	"
LOTES VIET NAM COMPANY LIMITED	91,729,000	2,819,292	-	884,181	-	-	91,729,000	100.00%	3,703,473	-	3,703,473	"
I-SEE VISION TECHNOLOGY INC.	4,700,000	27,211	6,430,123	36,922	-	-	11,130,123	22.41%	64,133	-	64,133	"
AionChip Technologies CO., LTD.	5,264,980	78,233	-	-	-	16,124	5,264,980	26.32%	62,109	-	62,109	"
	$ 26,077,007		5,927,458		1,828,432		30,176,033		30,176,033

Note 1: The amount includes additions to investments of NT$1,004,911 thousand, disposal of investments of NT$350 thousand, merger with subsidiaries of NT$45,526 thousand, cash dividends received from subsidiaries of NT$100,365 thousand, recognition of investment income of NT$3,346,582 thousand (including unrealized intercompany sales gain of NT$27,104 thousand), recognition of a decrease in cumulative translation adjustments of NT$101,364 thousand, recognition of a decrease in capital surplus of investees of NT$6,585 thousand under the equity method, recognition of unrealized losses on financial assets of NT$389 thousand under the equity method, and recognition of unearned employee compensation of NT$2,112 thousand under the equity method.

LOTES CO., LTD.
STATEMENT OF DEFERRED TAX ASSETS
DECEMBER 31, 2025
Unit: NT$ thousands

Item	Description	Amount
Deferred tax assets		$ 147,171

STATEMENT OF
OTHER NON-CURRENT ASSETS

Item	Description	Amount
Refundable deposits		$ 6,027
Prepayments for construction		20,750
Prepayments for equipment		460
		$ 27,237

LOTES CO., LTD.
STATEMENT OF NOTES PAYABLE
DECEMBER 31, 2025
Unit: NT$ thousands

Item	Description	Amount
Non-related parties:
Company H		$ 2,567
Company I		2,264
Company J		586
Company K		416
Others (Note)		2,300
		$ 8,133

Note: The balance of each individual customer does not exceed 5% of the account balance and is therefore not separately presented.

STATEMENT OF ACCOUNTS PAYABLE

Item	Description	Amount
Related parties:
SWISS GOOD ENTERPRISES LIMITED		$ 4,856,603
LOTES VIET NAM COMPANY LIMITED		609,399
LOTES ZHONGSHAN CO., LTD.		542,633
LOTES GUANGZHOU CO., LTD.		381,724
Others (Note)		301,644
		$ 6,692,003
Non-related parties:
Company L		$ 1,711
Company M		114
Company N		99
Others (Note)		14
		$ 1,938

Note: The balance of each individual customer does not exceed 5% of the account balance and is therefore not separately presented.

LOTES CO., LTD.
STATEMENT OF OTHER PAYABLES
DECEMBER 31, 2025 Unit: NT$ thousands

Item	Description	Amount
Related parties:
Lotes USA. Inc.		$ 7,855
Others		148
		$ 8,003
Non-related parties:
Salaries payable	Mainly salaries payable and year-end bonuses	$ 46,447
Compensation payable to employees and directors	Mainly estimated employee and directors’ compensation for 2025	199,000
Royalties payable	Mainly royalties payable	80,774
Technical service fees payable	Mainly technical service fees payable	65,314
Others		86,232
Total		$ 477,767
Current income tax liabilities		$ 889,126

Note: The balance of each individual customer does not exceed 5% of the account balance and is therefore not separately presented.

STATEMENT OF REFUND LIABILITIES
- CURRENT

Item	Description	Amount
Refund liabilities – current	Expected amounts payable to customers due to discounts	$ 626,736

LOTES CO., LTD.
STATEMENT OF OTHER CURRENT LIABILITIES
DECEMBER 31, 2025 Unit: NT$ thousands

Item	Description	Amount
Other current liabilities	Collections on behalf of others	$ 4,987
Advances received	Amounts received from employees for subscription of treasury shares	324,948
		$ 329,935

STATEMENT OF DEFERRED TAX LIABILITIES

Item	Description	Amount
Deferred tax liabilities		$ 93,011

STATEMENT OF PROVISIONS - NON-CURRENT

Item	Description	Amount
Provisions – non-current	Provision for employee benefit obligations	$ 43,187

LOTES CO., LTD.
STATEMENT OF OTHER CURRENT
LIABILITIES
DECEMBER 31, 2025
Unit: NT$ thousands

Item	Description	Amount
Guarantee deposits received		$ 193

STATEMENT OF OPERATING REVENUE
FOR THE YEAR ENDED DECEMBER 31, 2025

Item	Quantity	Amount
Sales revenue:
General sales	1,166,063KPCS	$ 13,002,718
Triangular trade	1,320,951KPCS	11,214,113
Less: Sales returns		(24,749)
Sales discounts		(168,991)
Net operating revenue		$ 24,023,091

LOTES CO., LTD.
STATEMENT OF OPERATING COSTS
FOR THE YEAR ENDED DECEMBER 31, 2025 Unit: NT$ thousands

Item	Amount
Direct materials
Beginning balance	$ 16
Add: Purchases during the period	208
Less: Ending raw materials	(12)
Materials consumed	212
Processing costs	132
Total manufacturing costs	344
Add: Beginning finished goods	3,584
Ending finished goods	(2,475)
Cost of finished goods	1,453
Add: Beginning merchandise	1,137,392
Purchases during the period	16,417,650
Others	31,707
Less: Ending merchandise	(1,175,487)
Others	(7,096)
Cost of goods sold	16,404,166
Loss (reversal of gain) on inventory write-down, obsolescence and scrapping	(460)
Operating costs	$ 16,405,159

LOTES CO., LTD.
STATEMENT OF SELLING EXPENSES
FOR THE YEAR ENDED DECEMBER 31, 2025 Unit: NT$ thousands

Item	Description	Amount
Royalties		$ 410,012
Import and export expenses		104,755
Salaries expense		89,780
Others (Note)		129,309
		$ 733,856

Note: The balance of each individual item does not exceed 5% of the account balance and is therefore not separately presented.

STATEMENT OF ADMINISTRATIVE EXPENSES

Item	Description	Amount
Salaries expense		$ 245,844
Professional service fees		37,375
Others (Note)		241,735
Total		$ 524,954

Note: The balance of each individual item does not exceed 5% of the account balance and is therefore not separately presented.

LOTES CO., LTD.

DECEMBER 31, 2025

For detailed information on other significant accounting items, please refer to the following notes:

(1) Property, plant and equipment and accumulated depreciation—refer to Note VI (6).

(2) Right-of-use assets and accumulated depreciation—refer to Note VI (7).

(3) Investment property and accumulated depreciation—refer to Note VI (8).

(4) Intangible assets—refer to Note VI (9).

(5) Other gains and losses, net—refer to Note VI (22).

AI assistant

LOTES — Audit Report / Information 2025

52339_rns_2026-05-21_38993bbe-69c6-4145-845d-627250c022f6.pdf

Lotes Co., Ltd.

Auditors' Responsibilities for the Audit of the Parent Company Only Financial Statements

Notice to Readers

Statements of Cash Flows

IV. Summary of Major Accounting Policies

2. Foreign Operations

(4) Classification of Current and Non-current Assets and Liabilities

3. Short-term Employee Benefits

(18) Share-based Payment Transactions

Notes to the Parent Company Only Financial Statements

Notes to the Parent Company Only Financial Statements

3. Collateral

(6) Property, Plant and Equipment

Notes to the Parent Company Only Financial Statements

(9) Intangible Assets

(10) Short-term Borrowings

(11) Bonds Payable

(1) Issuance Details

(2) Conversion Details

Notes to the Parent Company Only Financial Statements

(12) Lease Liabilities

(13) Refund Liabilities - Current

(14) Provision for Liabilities

(15) Operating Lease

Notes to the Parent Company Only Financial Statements

Notes to the Parent Company Only Financial Statements

(17) Income Taxes

1. Details of Income Tax Expense

2. Deferred Tax Assets and Liabilities

(1) Recognized Deferred Tax Assets

(2) Recognized Deferred Tax Liabilities

3. Income Tax Assessment

4. Global Minimum Tax

(18) Capital and Other Equity

(20) Earnings per share

(21) Revenue from Contracts with Customers

4. Financial costs

(23) Compensation to Employees and Directors

Notes to the Parent Company Only Financial Statements

2. Liquidity risk

Notes to the Parent Company Only Financial Statements

Notes to the Parent Company Only Financial Statements

Notes to the Parent Company Only Financial Statements

Notes to the Parent Company Only Financial Statements

VII. Related Party Transactions

XII. Others

XIII. Disclosing Information

(1) Information on Major Transactions

2. Endorsement/guarantee provided

Notes to the Parent Company Only Financial Statements (Continued)

Notes to the Parent Company Only Financial Statements

Notes to the Parent Company Only Financial Statements

Notes to the Parent Company Only Financial Statements

Notes to the Parent Company Only Financial Statements

LOTES CO., LTD.

STATEMENT OF CASH AND CASH EQUIVALENTS

DECEMBER 31, 2025

STATEMENT OF ACCOUNTS RECEIVABLE

LOTES CO., LTD.

STATEMENT OF OTHER RECEIVABLES

STATEMENT OF INVENTORIES

STATEMENT OF ACCOUNTS PAYABLE

STATEMENT OF DEFERRED TAX LIABILITIES

STATEMENT OF PROVISIONS - NON-CURRENT

STATEMENT OF ADMINISTRATIVE EXPENSES

More from LOTES

LOTES Audit Report / Information 2025