Shihlin Electric & Engineering Corp. and Subsidiaries

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

DECLARATION OF CONSOLIDATION OF FINANCIAL STATEMENTS OF AFFILIATES

The companies required to be included in the consolidated financial statements of affiliates in accordance with the "Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises" for the year ended December 31, 2025 are all the same as the companies required to be included in the consolidated financial statements of parent and subsidiary companies as provided in International Financial Reporting Standards No. 10, "Consolidated Financial Statements". Relevant information that should be disclosed in the consolidated financial statements of affiliates has all been disclosed in the consolidated financial statements of parent and subsidiary companies. Hence, we did not prepare a separate set of consolidated financial statements of affiliates.

Very truly yours,

SHIHLIN ELECTRIC & ENGINEERING CORP.

EMMET HSU
Chairman

March 16, 2026

INDEPENDENT AUDITORS' REPORT

The Board of Directors and Shareholders
Shihlin Electric & Engineering Corp.

Opinion

We have audited the accompanying consolidated financial statements of Shihlin Electric & Engineering Corp. and its subsidiaries (collectively referred to as the "Group"), which comprise the consolidated balance sheets as of December 31, 2025 and 2024, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including material accounting policy information (collectively referred to as the "consolidated financial statements").

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

Basis for Opinion

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

Key Audit Matters

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

The key audit matter of the Group’s consolidated financial statements for the year ended December 31, 2025 is described as follows:

The Occurrence of Major Customers’ Operating Revenue

The Group are engaged in the manufacture of heavy electrical equipment and machinery and electronic equipment, devices, and related parts. Since there were significant changes in major customers, and the amount and fluctuations of operating revenue may affect financial statement users’ understanding of the overall financial statements, the occurrence of operating revenue from major customers with significant growth compared to the same period of the prior year and newly added major customers in 2025 was deemed as a key audit matter. Refer to Notes 4, 22 and 34 to the consolidated financial statements for the related revenue recognition policies and information.

The main audit procedures performed in response to the abovementioned key audit matter were as follows:

We obtained an understanding of the design of the relevant internal controls over revenue recognition and tested their operating effectiveness.
We performed substantive tests of transactions for major customers. The procedures included selecting appropriate samples and tracing them to external transaction documents and subsequent collections from customers in order to verify the occurrence of transactions and to confirm that the collections were consistent with the counterparties of the transactions.

Other Matter

We did not audit the financial statements of certain subsidiaries of the Group as of and for the years ended December 31, 2025 and 2024, which were included in the accompanying consolidated financial statements, but such financial statements were audited by other auditors whose reports have been furnished to us. Our opinion, insofar as it relates to the amounts included in the Group’s consolidated financial statements for such subsidiaries, is based solely on the reports of other auditors. The total assets of such subsidiaries amounted to NT$1,012,644 thousand and NT$1,051,483 thousand as of December 31, 2025 and 2024, respectively, which represented 1.67% and 1.80%, respectively, of the Group’s consolidated total assets. The operating revenue of such subsidiaries amounted to NT$253,164 thousand and NT$237,343 thousand for the years ended December 31, 2025 and 2024, respectively, both represented 0.68% of the Group’s consolidated total operating revenue. We did not audit the financial statements of certain associates of the Group as of and for the years ended December 31, 2025 and 2024, which were reflected in the accompanying consolidated financial statements using the equity method of accounting, but such financial statements were audited by other auditors whose reports have been furnished to us. Our opinion, insofar as it relates to the amounts included in the Group’s consolidated financial statements for such associates, is based solely on the reports of other auditors. The aforementioned equity-method investments amounted to NT$12,025,173 thousand and NT$13,111,723 thousand as of December 31, 2025 and 2024, respectively, which represented 19.86% and 22.45%, respectively, of the Group’s consolidated total assets. The Group’s share of profit or loss from such associates amounted to NT$81,990 thousand and NT$308,506 thousand for the years ended December 31, 2025 and 2024, respectively, which represented 1.92% and 7.71%, respectively, of the Group’s consolidated profit before income tax. The Group’s share of comprehensive (loss) income of such associates amounted to NT$(1,127,953) thousand and NT$3,011,425 thousand for the years ended December 31, 2025 and 2024, respectively, which represented (96.20%) and 43.88%, respectively, of the Group’s consolidated total comprehensive income.

We have also audited the parent company only financial statements of Shihlin Electric & Engineering Corp. as of and for the years ended December 31, 2025 and 2024 on which we have issued an unmodified opinion with Other Matter paragraph.

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

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

In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including the audit committee, are responsible for overseeing the Group’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.
4 -

Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of the group audit. We remain solely responsible for our audit opinion.

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

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

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

The engagement partners on the audits resulting in this independent auditors’ report are Yao-Lin Huang and Yeh-Wei Chuang.

Deloitte & Touche
Taipei, Taiwan
Republic of China

March 16, 2026

Notice to Readers

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

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

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2025 AND 2024

(In Thousands of New Taiwan Dollars)

	2025		2024
ASSETS	Amount	%	Amount	%
CURRENT ASSETS
Cash and cash equivalents (Note 6)	$ 5,094,258	8	$ 3,370,646	6
Contract assets - current (Note 22)	1,735,341	3	1,585,314	3
Notes receivable (Notes 9 and 22)	1,005,650	2	982,689	1
Trade receivables (Notes 9 and 22)	6,059,590	10	6,409,873	11
Trade receivables from related parties (Notes 22 and 29)	186,403	-	129,057	-
Other receivables	4,101	-	9,916	-
Other receivables from related parties (Note 29)	40,631	-	58,116	-
Inventories (Note 10)	12,083,248	20	9,853,327	17
Other current assets (Notes 16, 29 and 30)	2,953,584	5	2,175,058	4
Total current assets	29,162,806	48	24,573,996	42
NON-CURRENT ASSETS
Financial assets at fair value through profit or loss - non-current (Note 7)	826,915	1	911,580	2
Financial assets at fair value through other comprehensive income - non-current (Note 8)	2,457,460	4	3,050,503	5
Investments accounted for using the equity method (Notes 12 and 30)	12,771,213	21	14,696,849	25
Property, plant and equipment (Notes 13, 29 and 30)	7,711,917	13	7,522,906	13
Right-of-use assets (Note 14)	198,908	-	194,355	-
Investment properties (Notes 15 and 30)	6,897,375	12	6,986,968	12
Deferred tax assets (Note 24)	368,079	1	317,111	1
Other non-current assets (Note 30)	142,739	-	140,191	-
Total non-current assets	31,374,606	52	33,820,463	58
TOTAL	$ 60,537,412	100	$ 58,394,459	100
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Notes 17 and 30)	$ 1,328,916	2	$ 932,252	2
Contract liabilities - current (Notes 22 and 29)	9,544,744	16	5,281,790	9
Notes payable	187,654	-	252,224	1
Trade payables	4,984,799	8	6,280,928	11
Trade payables to related parties (Note 29)	214,380	1	191,689	-
Other payables (Note 18)	1,962,538	3	1,893,694	3
Other payables to related parties (Note 29)	35,549	-	36,620	-
Current tax liabilities (Note 24)	507,255	1	442,757	1
Provisions - current (Note 19)	1,926,077	3	1,837,632	3
Lease liabilities - current (Note 14)	22,150	-	9,016	-
Other current liabilities	223,685	1	213,488	-
Total current liabilities	20,937,747	35	17,372,090	30
NON-CURRENT LIABILITIES
Provisions - non-current (Note 19)	37,391	-	32,671	-
Deferred tax liabilities (Note 24)	2,138,728	4	2,325,680	4
Lease liabilities - non-current (Note 14)	11,318	-	9,293	-
Deferred revenue - non-current	44,707	-	46,841	-
Net defined benefit liability - non-current (Note 20)	157,165	-	141,723	-
Other non-current liabilities	91,574	-	91,078	-
Total non-current liabilities	2,480,883	4	2,647,286	4
Total liabilities	23,418,630	39	20,019,376	34
EQUITY ATTRIBUTABLE TO OWNERS OF THE CORPORATION (Notes 21 and 26)
Ordinary shares	5,209,722	8	5,209,722	9
Capital surplus	2,797,585	5	2,695,304	4
Retained earnings
Legal reserve	3,862,601	6	3,545,218	6
Special reserve	5,136,954	9	5,136,954	9
Unappropriated earnings	13,875,389	23	13,367,159	23
Total retained earnings	22,874,944	38	22,049,331	38
Other equity	5,410,338	9	7,583,567	13
Total equity attributable to owners of the Corporation	36,292,589	60	37,537,924	64
NON-CONTROLLING INTERESTS (Note 21)	826,193	1	837,159	2
Total equity	37,118,782	61	38,375,083	66
TOTAL	$ 60,537,412	100	$ 58,394,459	100

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

(With Deloitte & Touche auditors' report dated March 16, 2026)

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

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

	2025		2024
	Amount	%	Amount	%
OPERATING REVENUE (Notes 22 and 29)
Sales	$ 31,891,782	86	$ 31,548,431	90
Rental revenue	486,156	1	479,511	1
Construction revenue	4,788,007	13	3,030,719	9
Other operating revenue	12,000	-	12,500	-
Total operating revenue	37,177,945	100	35,071,161	100
OPERATING COSTS (Notes 10, 23 and 29)
Cost of goods sold	25,050,291	67	25,393,024	72
Rental cost	197,692	1	202,051	1
Construction cost	4,147,951	11	2,651,576	8
Other operating cost	14,133	-	11,184	-
Total operating costs	29,410,067	79	28,257,835	81
GROSS PROFIT	7,767,878	21	6,813,326	19
OPERATING EXPENSES (Notes 9, 23 and 29)
Selling and marketing expenses	1,471,726	4	1,462,682	4
General and administrative expenses	1,348,608	4	1,357,032	4
Research and development expenses	629,267	2	670,781	2
Expected credit loss recognized (reversed) on trade receivables	19,091	-	(32,227)	-
Total operating expenses	3,468,692	10	3,458,268	10
PROFIT FROM OPERATIONS	4,299,186	11	3,355,058	9
NON-OPERATING INCOME AND EXPENSES
Interest income (Note 23)	36,631	-	48,653	-
Other income (Notes 23 and 29)	86,989	-	71,061	-
Other gains and losses (Notes 23 and 29)	(150,848)	-	214,309	1
Finance costs (Note 23)	(15,323)	-	(19,030)	-
Share of profit of associates accounted for using the equity method	13,098	-	333,339	1
Total non-operating income	(29,453)	-	648,332	2
PROFIT BEFORE INCOME TAX	4,269,733	11	4,003,390	11
INCOME TAX EXPENSE (Note 24)	892,106	2	859,652	2
NET PROFIT FOR THE YEAR	3,377,627	9	3,143,738	9

(Continued)

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

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

	2025		2024
	Amount	%	Amount	%
OTHER COMPREHENSIVE INCOME (LOSS)
Items that will not be reclassified subsequently to profit or loss:
Remeasurement of defined benefit plans (Note 20)	$ (63,986)	-	$ 66,336	-
Unrealized (loss) gain on investments in equity instruments at fair value through other comprehensive income	(750,918)	(2)	718,653	2
Share of other comprehensive (loss) income of associates accounted for using the equity method	(1,209,947)	(3)	2,702,914	8
Income tax relating to items that will not be reclassified subsequently to profit or loss (Note 24)	12,797	-	(13,267)	-
Total items that will not be reclassified subsequently to profit or loss	(2,012,054)	(5)	3,474,636	10
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translating the financial statements of foreign operations	(239,569)	(1)	300,461	1
Income tax relating to items that may be reclassified subsequently to profit or loss (Note 24)	46,498	-	(56,619)	-
Total items that may be reclassified subsequently to profit or loss	(193,071)	(1)	243,842	1
Other comprehensive (loss) income for the year, net of income tax	(2,205,125)	(6)	3,718,478	11
TOTAL COMPREHENSIVE INCOME FOR THE YEAR	$ 1,172,502	3	$ 6,862,216	20
NET PROFIT ATTRIBUTABLE TO:
Owners of the Corporation	$ 3,267,810	9	$ 3,025,741	9
Non-controlling interests	109,817	-	117,997	-
	$ 3,377,627	9	$ 3,143,738	9
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Owners of the Corporation	$ 1,093,214	3	$ 6,689,259	19
Non-controlling interests	79,288	-	172,957	1
	$ 1,172,502	3	$ 6,862,216	20

(Continued)

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

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

	2025		2024
	Amount	%	Amount	%
EARNINGS PER SHARE (Note 25)
Basic	$ 6.27		$ 5.81
Diluted	$ 6.26		$ 5.80

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

(With Deloitte & Touche auditors’ report dated March 16, 2026) (Concluded)

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

(In Thousands of New Taiwan Dollars)

	Equity Attributable to Owners of the Corporation
	Ordinary Shares	Capital Surplus	Retained Earnings				Other Equity			Total	Non-controlling Interests	Total Equity
			Legal Reserve	Special Reserve	Unappropriated Earnings	Total	Exchange Differences on Translating the Financial Statements of Foreign Operations	Unrealized Gain (Loss) on Financial Assets at Fair Value Through Other Comprehensive Income	Total
BALANCE ON JANUARY 1, 2024	$ 5,209,722	$ 2,658,913	$ 3,298,427	$ 5,136,954	$ 12,003,033	$ 20,438,414	$ (326,477)	$ 4,444,837	$ 4,118,360	$ 32,425,409	$ 718,964	$ 33,144,373
Appropriation of the 2023 earnings
Legal reserve			246,791		(246,791)
Cash dividends					(1,562,917)	(1,562,917)				(1,562,917)		(1,562,917)
Changes in equity from investments in associates accounted for using the equity method		36,237			(50,404)	(50,404)				(14,167)	(1,039)	(15,206)
Adjustments to share of changes in equity of subsidiaries		154						186	186	340	(340)
Net profit for the year ended December 31, 2024					3,025,741	3,025,741				3,025,741	117,997	3,143,738
Other comprehensive income for the year ended December 31, 2024, net of income tax					53,732	53,732	224,960	3,384,826	3,609,786	3,663,518	54,960	3,718,478
Total comprehensive income for the year ended December 31, 2024					3,079,473	3,079,473	224,960	3,384,826	3,609,786	6,689,259	172,957	6,862,216
Decrease in non-controlling interests											(53,383)	(53,383)
Disposal of investments in equity instruments designated as at fair value through other comprehensive profit or loss					144,765	144,765		(144,765)	(144,765)
BALANCE ON DECEMBER 31, 2024	5,209,722	2,695,304	3,545,218	5,136,954	13,367,159	22,049,331	(101,517)	7,685,084	7,583,567	37,537,924	837,159	38,375,083
Appropriation of the 2024 earnings
Legal reserve			317,383		(317,383)
Cash dividends					(2,344,375)	(2,344,375)				(2,344,375)		(2,344,375)
Changes in equity from investments in associates accounted for using the equity method		101,904			(96,801)	(96,801)				5,103	(4,398)	705
Adjustments to share of changes in equity of subsidiaries		377						346	346	723	(723)
Net profit for the year ended December 31, 2025					3,267,810	3,267,810				3,267,810	109,817	3,377,627
Other comprehensive income (loss) for the year ended December 31, 2025, net of income tax					(51,393)	(51,393)	(183,373)	(1,939,830)	(2,123,203)	(2,174,596)	(30,529)	(2,205,125)
Total comprehensive income (loss) for the year ended December 31, 2025					3,216,417	3,216,417	(183,373)	(1,939,830)	(2,123,203)	1,093,214	79,288	1,172,502
Decrease in non-controlling interests											(85,133)	(85,133)
Disposal of investments in equity instruments designated as at fair value through other comprehensive profit or loss					50,372	50,372		(50,372)	(50,372)
BALANCE ON DECEMBER 31, 2025	$ 5,209,722	$ 2,797,585	$ 3,862,601	$ 5,136,954	$ 13,875,389	$ 22,874,944	$ (284,890)	$ 5,695,228	$ 5,410,338	$ 36,292,589	$ 826,193	$ 37,118,782

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

(With Deloitte & Touche auditors' report dated March 16, 2026)

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

(In Thousands of New Taiwan Dollars)

	2025	2024
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before income tax	$ 4,269,733	$ 4,003,390
Adjustments for:
Depreciation expense	797,221	774,035
Amortization expense	19,788	21,066
Expected credit loss recognized/(reversed) on trade receivables	19,091	(32,227)
Net loss/(gain) on fair value change of financial assets at fair value through profit or loss	115,868	(47,379)
Finance costs	15,323	19,030
Interest income	(36,631)	(48,653)
Dividend income	(82,756)	(64,348)
Share of profit of associates accounted for using the equity method	(13,098)	(333,339)
(Gain)/loss on disposal of property, plant and equipment	(625)	2,812
Reversal of impairment recognized on property, plant and equipment	-	(878)
Gain on lease changes in lease term	(20)	-
Changes in operating assets and liabilities
Contract assets	(150,027)	117,508
Notes receivable	(22,961)	218,569
Trade receivables	332,680	(95,468)
Trade receivables from related parties	(57,346)	2,909
Other receivables	5,815	62
Other receivables from related parties	52,595	(1,194)
Inventories	(2,270,226)	(645,062)
Other current assets	(959,180)	(742,233)
Net defined benefit assets	-	3,214
Contract liabilities	4,262,954	(1,297,596)
Notes payable	(64,570)	30,913
Trade payables	(1,302,448)	690,791
Trade payables to related parties	22,691	67,706
Other payables	68,896	118,478
Other payables to related parties	(1,071)	6,985
Provisions	94,753	330,036
Other current liabilities	11,548	(47,441)
Net defined benefit liabilities	(48,544)	(56,678)
Deferred revenue	(1,189)	(1,228)
Cash generated from operations	5,078,264	2,993,780
Interest received	39,426	46,994
Interest paid	(15,375)	(19,360)
Income tax paid	(1,006,233)	(726,579)
Net cash generated from operating activities	4,096,082	2,294,835
		(Continued)

11 -

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

(In Thousands of New Taiwan Dollars)

	2025	2024
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of financial assets at fair value through other comprehensive income	$ (195,000)	$ -
Disposal of financial assets at fair value through other comprehensive income	37,125	99,706
Purchase of financial assets at fair value through profit or loss	(40,180)	(20,400)
Proceeds from capital reduction of financial assets at fair value through profit or loss	-	2,093
Acquisition of associate	(80,000)	(89,200)
Payments for property, plant and equipment	(950,743)	(810,207)
Proceeds from disposal of property, plant and equipment	78,632	38,654
Payments for investment properties	(5,353)	(2,163)
Decrease in other financial assets	167,506	76,328
Increase in other non-current assets	(12,406)	(30,508)
Dividends received from associates	696,330	385,340
Other dividends received	82,756	64,348
Net cash used in investing activities	(221,333)	(286,009)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in short-term borrowings	396,458	-
Decrease in short-term borrowings	-	(515,037)
Proceeds from guarantee deposits received	-	328
Refund of guarantee deposits received	(801)	-
Repayment of the principal portion of lease liabilities	(18,196)	(9,760)
Dividends paid to owners of the Corporation	(2,344,375)	(1,562,917)
Dividends paid to non-controlling interests	(85,133)	(92,583)
Other changes in non-controlling interests	-	39,200
Net cash used in financing activities	(2,052,047)	(2,140,769)
EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH HELD IN FOREIGN CURRENCIES	(99,090)	129,171
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	1,723,612	(2,772)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR	3,370,646	3,373,418
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR	$ 5,094,258	$ 3,370,646

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

(With Deloitte & Touche auditors' report dated March 16, 2026) (Concluded)

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

1. GENERAL INFORMATION

Shihlin Electric & Engineering Corp. (the "Corporation") was established in November 1955, and engaged in the manufacture of heavy electrical equipment, electrical machinery, electrical automotive equipment and related parts, and the sale and lease of commercial buildings.

The Corporation's shares have been listed and traded on the Taiwan Stock Exchange since December 1969.

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

2. APPROVAL OF CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements were approved by the Corporation's board of directors and authorized for issue on March 12, 2026.

3. APPLICATION OF NEW, AMENDED AND REVISED STANDARDS AND INTERPRETATIONS

a. Initial application of the amendments to the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, the "IFRS Accounting Standards") endorsed and issued into effect by the Financial Supervisory Commission (FSC)

The initial application of the IFRS Accounting Standards endorsed and issued into effect by the FSC did not have material impact on the accounting policies of the Corporation and entities controlled by the Group (collectively referred to as the "Group").

b. The IFRS Accounting Standards endorsed by the FSC for application starting from 2026

New, Amended and Revised Standards and Interpretations	Effective Date Announced by International Accounting Standards Board (IASB)
Amendments to IFRS 9 and IFRS 7 “Amendments to the Classification and Measurement of Financial Instruments”	January 1, 2026
Amendments to IFRS 9 and IFRS 7 “Contracts Referencing Nature-dependent Electricity”	January 1, 2026
Annual Improvements to IFRS Accounting Standards - Volume 11	January 1, 2026
IFRS 17 “Insurance Contracts” (including the 2020 and 2021 amendments to IFRS 17)	January 1, 2023

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

1) The amendments to the application guidance of classification of financial assets

The amendments mainly amend the requirements for the classification of financial assets, including:

a) If a financial asset contains a contingent feature that could change the timing or amount of contractual cash flows and the contingent event itself does not relate directly to changes in basic lending risks and costs (e.g., whether the debtor achieves a contractually specified reduction in carbon emissions), the financial asset has contractual cash flows that are solely payments of principal and interest on the principal amount outstanding if, and only if,

In all possible scenarios (before and after the occurrence of a contingent event), the contractual cash flows are solely payments of principal and interest on the principal amount outstanding; and
In all possible scenarios, the contractual cash flows would not be significantly different from the contractual cash flows on a financial instrument with identical contractual terms, but without such a contingent feature.

b) To clarify that a financial asset has non-recourse features if an entity’s ultimate right to receive cash flows is contractually limited to the cash flows generated by specified assets.

c) To clarify that the characteristics of contractually linked instruments include a prioritization of payments to the holders of financial assets using multiple contractually linked instruments (tranches) established through a waterfall payment structure, resulting in concentrations of credit risk and a disproportionate allocation of cash shortfalls from the underlying pool between the tranches.

2) The amendments to the application guidance of derecognition of financial liabilities

The amendments mainly stipulate that a financial liability is derecognized on the settlement date. However, when settling a financial liability in cash using an electronic payment system, the Group can choose to derecognize the financial liability before the settlement date if, and only if, the Group has initiated a payment instruction that resulted in:

The Group having no practical ability to withdraw, stop or cancel the payment instruction;
The Group having no practical ability to access the cash to be used for settlement as a result of the payment instruction; and
The settlement risk associated with the electronic payment system being insignificant.

An entity shall apply the amendments retrospectively but is not required to restate prior periods. The effect of initially applying the amendments shall be recognized as an adjustment to the opening balance at the date of initial application. An entity may restate prior periods if, and only if, it is possible to do so without the use of hindsight.

As of the date the consolidated financial statements were authorized for issue, the Group is continuously assessing the other impacts on the Group’s financial position and financial performance and will disclose the relevant impact when the assessment is completed.

c. The IFRS Accounting Standards in issue but not yet endorsed and issued into effect by the FSC

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

Note 1: Unless stated otherwise, the above IFRS Accounting Standards are effective for annual reporting periods beginning on or after their respective effective dates.

Note 2: On September 25, 2025, the FSC announced that IFRS 18 will take effect starting from January 1, 2028. Domestic entities could elect to apply IFRS 18 for an earlier period after the endorsement of IFRS 18 by the FSC.

IFRS 18 “Presentation and Disclosure in Financial Statements” and consequential amendments

IFRS 18 will supersede IAS 1 “Presentation of Financial Statements”. The main changes comprise:

To classify items of income and expenses presented in the statement of profit or loss into the operating, investing, financing, income taxes and discontinued operations categories, the Group shall assess whether it has specified main business activities of investing in particular types of assets and providing financing to customers.
The statement of profit or loss shall present totals and subtotals for operating profit or loss, profit or loss before financing and income taxes and profit or loss.
Provides guidance to enhance the requirements of aggregation and disaggregation: The Group shall identify the assets, liabilities, equity, income, expenses and cash flows that arise from individual transactions or other events and shall classify and aggregate them into groups based on shared characteristics, so as to result in the presentation in the primary financial statements of line items that have at least one similar characteristic. The Group shall disaggregate items with dissimilar characteristics in the primary financial statements and in the notes. The Group labels items as “other” only if it cannot find a more informative label.
Disclosures on Management-defined Performance Measures (MPMs): When in public communications outside financial statements and communicating to users of financial statements view of an aspect of the financial performance of the Group as a whole, the Group shall disclose related information about its MPMs in a single note to the financial statements, including the description of such measures, calculations, reconciliations to the subtotal or total specified by IFRS Accounting Standards and the income tax and non-controlling interests effects of related reconciliation items.

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

The Group shall use operating profit or loss as the starting point when presenting cash flows from operating activities under the indirect method.
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Interest and dividends received by the Group shall be classified as investing activities, while interest and dividends paid shall be classified as financing activities. However, if, after assessment, the Group has a specific main operating activity, it shall determine how to classify dividends received, interest received and interest paid in the statement of cash flows by referring to how it classifies dividend income, interest income and interest expense in the statement of profit or loss. The total of each of these cash flows shall be classified in a single category in the statement of cash flows.

Except for the above impact, as of the date the consolidated financial statements were authorized for issue, the Group is continuously assessing the other impacts of the above amended standards and interpretations on the Group's financial position and financial performance and will disclose the relevant impact when the assessment is completed.

4. SUMMARY OF MATERIAL ACCOUNTING POLICY INFORMATION

a. Statement of compliance

The consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRS Accounting Standards as endorsed and issued into effect by the FSC.

b. Basis of preparation

The consolidated financial statements have been prepared on the historical cost basis except for financial instruments which are measured at fair value and net defined benefit liabilities which are measured at the present value of the defined benefit obligation less the fair value of plan assets.

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

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

c. Classification of current and non-current assets and liabilities

Current assets include:

1) Assets held primarily for the purpose of trading;
2) Assets expected to be realized within twelve months after the reporting period; and
3) Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

Current liabilities include:

1) Liabilities held primarily for the purpose of trading;
2) Liabilities due to be settled within twelve months after the reporting period, even if an agreement to refinance, or to reschedule payments, on a long-term basis is completed after the reporting period and before the consolidated financial statements are authorized for issue; and

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3) Liabilities for which the Group does not have the substantial right at the end of the reporting period to defer settlement for at least 12 months after the reporting period.

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

The Group is engaged in the construction business, which has an operating cycle of over 1 year. The normal operating cycle applies when considering the classification of the Group’s construction-related assets and liabilities.

d. Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Corporation and the entities controlled by the Corporation (i.e., its subsidiaries, including structured entities).

Income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statements of comprehensive income from the effective dates of acquisitions up to the effective dates of disposal, as appropriate.

When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Group.

All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation. Total comprehensive income of subsidiaries is attributed to the owners of the Corporation and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

Changes in the Group’s ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the interests of the Group and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to the owners of the Corporation.

When the Group loses control of a subsidiary, a gain or loss is recognized in profit or loss and is calculated as the difference between (i) the aggregate of the fair value of the consideration received and any investment retained in the former subsidiary at its fair value at the date when control is lost and (ii) the assets (including any goodwill) and liabilities and any non-controlling interests of the former subsidiary at their carrying amounts at the date when control is lost. The Group accounts for all amounts recognized in other comprehensive income in relation to that subsidiary on the same basis as would be required had the Group directly disposed of the related assets or liabilities.

The fair value of any investment retained in the former subsidiary at the date when control is lost is regarded as the cost on initial recognition of an investment in an associate.

See Note 11, Tables 6 and 7 for detailed information on subsidiaries (including percentages of ownership and main businesses).

e. Foreign currencies

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

At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Exchange differences on monetary items arising from settlement or translation are recognized in profit or loss in the period.

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Non-monetary items measured at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Exchange differences arising on the retranslation of non-monetary items are included in profit or loss for the period except for exchange differences arising from the retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income, in which case, the exchange differences are also recognized directly in other comprehensive income.

Non-monetary item denominated in a foreign currency and measured at historical cost is stated at the reporting currency as originally translated from the foreign currency which are not retranslated.

For the purposes of presenting the consolidated financial statements, the functional currencies of the entities (including operations of subsidiaries and associates in other countries or currencies used are different from the functional currency of the Corporation) are translated into the presentation currency - New Taiwan dollars as follows: Assets and liabilities are translated at the exchange rates prevailing at the end of the reporting period; income and expense items are translated at the average exchange rates for the period. The resulting currency translation differences are recognized in other comprehensive income attributed to the owners of the Corporation and non-controlling interests as appropriate.

On the disposal of a foreign operation (i.e., a disposal of the Group's entire interest in a foreign operation, or a disposal involving loss of control over a subsidiary that includes a foreign operation, or a partial disposal of an interest in an associate that includes a foreign operation of which the retained interest becomes a financial asset), all of the exchange differences accumulated in equity in respect of that operation attributable to the owners of the Corporation are reclassified to profit or loss.

In a partial disposal of a subsidiary that does not result in the Group losing control over the subsidiary, the proportionate share of accumulated exchange differences is re-attributed to the non-controlling interests of subsidiary and is not recognized in profit or loss. For all other partial disposals, the proportionate share of the accumulated exchange differences recognized in other comprehensive income is reclassified to profit or loss.

Goodwill and fair value adjustments recognized on identifiable assets and liabilities of acquired foreign operation are treated as assets and liabilities of the foreign operation and translated at the rate of exchange prevailing at the end of each reporting period. Exchange differences arising are recognized in other comprehensive income.

f. Inventories

Inventories consist of raw materials and supplies, work-in-process and finished goods and are stated at the lower of cost or net realizable value. Inventory write-downs are made by item, except where it may be appropriate to Group similar or related items. Net realizable value is the estimated selling price of inventories less all estimated costs of completion and costs necessary to make the sale. Inventories are recorded at weighted-average cost on the balance sheet date.

g. Investment in associates

An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an interest in a joint venture.

The Group uses the equity method to account for its investments in associates.

Under the equity method, investments in an associate are initially recognized at cost and adjusted thereafter to recognize the Group's share of profit or loss and other comprehensive income of the associate. The Group also recognizes the changes in the Group's share of equity of associates attributable to the Group.

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Any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets and liabilities of an associate at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment and is not amortized. Any excess of the Group’s share of the net fair value of the identifiable assets and liabilities over the cost of acquisition, after reassessment, is recognized immediately in profit or loss.

When the Group subscribes for additional new shares of the associate at a percentage different from its existing ownership percentage, the resulting carrying amount of the investment differs from the amount of the Group’s proportionate interest in the associate. The Group records such a difference as an adjustment to investments with the corresponding amount charged or credited to capital surplus - changes in equity of investment in associates accounted for using the equity method. If the Group’s ownership interest is reduced due to the additional subscription of the new shares of associate, the proportionate amount of the gains or losses previously recognized in other comprehensive income in relation to that associate is reclassified to profit or loss on the same basis as would be required if the investee had directly disposed of the related assets or liabilities. When the adjustment should be debited to capital surplus, but the capital surplus recognized from investments accounted for using the equity method is insufficient, the shortage is debited to retained earnings.

When the Group’s share of losses of an associate equals or exceeds its interest in that associate (which includes any carrying amount of the investment accounted for using the equity method and long-term interests that, in substance, form part of the Group’s net investment in the associate), the Group discontinues recognizing its share of further losses. Additional losses and liabilities are recognized only to the extent that the Group has incurred legal obligations, or constructive obligations, or made payments on behalf of that associate.

The entire carrying amount of the investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount with its carrying amount. Any impairment loss recognized is not allocated to any asset, including goodwill, that forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognized to the extent that the recoverable amount of the investment has subsequently increased.

The Group discontinues the use of the equity method from the date on which its investment ceases to be an associate. Any retained investment is measured at fair value at that date, and the fair value is regarded as its fair value on initial recognition as a financial asset. The difference between the previous carrying amount of the associate attributable to the retained interest and its fair value is included in the determination of the gain or loss on disposal of the associate. The Group accounts for all amounts previously recognized in other comprehensive income in relation to that associate on the same basis as would be required if that associate had directly disposed of the related assets or liabilities. If an investment in an associate becomes an investment in a joint venture or an investment in a joint venture becomes an investment in an associate, the Group continues to apply the equity method and does not remeasure the retained interest.

When the Group transacts with its associate, profits and losses resulting from the transactions with the associate are recognized in the consolidated financial statements only to the extent of interest in the associate that are not related to the Group.

h. Property, plant and equipment

Property, plant and equipment are initially measured at cost and subsequently measured at cost less accumulated depreciation and accumulated impairment loss.

Property, plant and equipment in the course of construction are measured at cost less any recognized impairment loss. Cost includes professional fees and borrowing costs eligible for capitalization. Such assets are depreciated and classified to the appropriate categories of property, plant and equipment when completed and ready for their intended use.

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Except for freehold land which is not depreciated, the depreciation of property, plant and equipment is recognized using the straight-line method or the fixed-percentage-of-declining-balance method. Each significant part is depreciated separately. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in the estimates accounted for on a prospective basis.

On derecognition of an item of property, plant and equipment, the difference between the sales proceeds and the carrying amount of the asset is recognized in profit or loss.

i. Investment properties

Investment properties are properties held to earn rentals and/or for capital appreciation.

Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation and accumulated impairment loss. Depreciation is recognized using the straight-line method or the fixed-percentage-of-declining-balance method.

On derecognition of an investment property, the difference between the net disposal proceeds and the carrying amount of the asset is included in profit or loss.

j. Impairment of property, plant and equipment, right-of-use asset, investment properties and assets related to contract costs

At the end of each reporting period, the Group reviews the carrying amounts of its property, plant and equipment, right-of-use asset and investment properties, to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Corporate assets are allocated to the smallest group of cash-generating units on a reasonable and consistent basis of allocation.

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

Before the Group recognizes an impairment loss from assets related to contract costs, any impairment loss on inventories and property, plant and equipment related to the contract applicable under IFRS 15 shall be recognized in accordance with applicable standards. Then, impairment loss from the assets related to the contract costs is recognized to the extent that the carrying amount of the assets exceeds the remaining amount of consideration that the Group expects to receive in exchange for related goods or services less the costs which relate directly to providing those goods or services and which have not been recognized as expenses. The assets related to the contract costs are then included in the carrying amount of the cash-generating unit to which they belong for the purpose of evaluating impairment of that cash-generating unit.

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

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k. Financial instruments

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

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

1) Financial assets

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis.

a) Measurement category

Financial assets are classified into the following categories: Financial assets at FVTPL, financial assets at amortized cost and investments in equity instruments at FVTOCI.

i. Financial assets at FVTPL

Financial assets are classified as at FVTPL when such a financial asset is mandatorily classified as at FVTPL. Financial assets mandatorily classified as at FVTPL include investments in equity instruments which are not designated as at FVTOCI.

Financial assets at FVTPL are subsequently measured at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. Fair value is determined in the manner described in Note 28.

ii. Financial assets at amortized cost

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

i) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and

ii) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Subsequent to initial recognition, financial assets at amortized cost, including cash and cash equivalents, notes receivable at amortized cost, trade receivables, other receivables and other financial assets, are measured at amortized cost, which equals the gross carrying amount determined using the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

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

i) Purchased or originated credit-impaired financial assets, for which interest income is calculated by applying the credit-adjusted effective interest rate to the amortized cost of such financial assets; and

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ii) Financial asset that is not credit-impaired on purchase or origination but has subsequently become credit-impaired, for which interest income is calculated by applying the effective interest rate to the amortized cost of such financial assets in subsequent reporting periods.

Cash equivalents include time deposits with original maturities within 3 months from the date of acquisition, which are highly liquid, readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value. These cash equivalents are held for the purpose of meeting short-term cash commitments.

iii. Investments in equity instruments at FVTOCI

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

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

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

b) Impairment of financial assets and contract assets

The Group recognizes a loss allowance for expected credit losses on financial assets at amortized cost (including trade receivables) and contract assets.

The Group always recognizes lifetime expected credit losses (ECLs) for trade receivables and contract assets. For all other financial instruments, the Group recognizes lifetime ECLs when there has been a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk on a financial instrument has not increased significantly since initial recognition, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month ECLs.

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

The impairment loss of all financial assets is recognized in profit or loss by a reduction in their carrying amounts through a loss allowance account, except for investments in debt instruments that are measured at FVTOCI, for which the loss allowance is recognized in other comprehensive income and the carrying amounts of such financial assets are not reduced.

c) Derecognition of financial assets

The Group 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 to another party.

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On derecognition of a financial asset at amortized cost in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognized in profit or loss. On derecognition of an investment in a debt instrument at FVTOCI, the difference between the asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss which had been recognized in other comprehensive income is recognized in profit or loss. However, on derecognition of an investment in an equity instrument at FVTOCI, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognized in profit or loss, and the cumulative gain or loss which had been recognized in other comprehensive income is transferred directly to retained earnings, without recycling through profit or loss.

On derecognition of a financial asset other than in its entirety, the Group allocates the previous carrying amount of the financial asset between the part it continues to recognize and the part it no longer recognizes on the basis of the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognized and the sum of the consideration received for the part that is no longer recognized is treated in the same way as when the financial asset is derecognized in entirety. A cumulative gain or loss that had been recognized in other comprehensive income is allocated between the part that continues to be recognized and the part that is no longer recognized on the basis of the relative fair values of those parts.

2) Equity instruments

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

Equity instruments issued by the Group are recognized at the proceeds received, net of direct issue costs.

The repurchase of the Corporation’s own equity instruments is recognized in and deducted directly from equity, and its carrying amounts are calculated based on weighted average by share types. No gain or loss is recognized in profit or loss on the purchase, sale, issuance or cancellation of the Corporation’s own equity instruments.

3) Financial liabilities

a) Subsequent measurement

All financial liabilities are measured at amortized cost using the effective interest method.

b) Derecognition of financial liabilities

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

Provisions

Provisions are measured at the best estimate of the discounted cash flows of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation.

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m. Revenue recognition

The Group identifies contracts with customers, allocating the transaction price to the performance obligations and recognizes revenue when performance obligations are satisfied.

For contracts where the period between the date on which the Group transfers a promised good to a customer and the date on which the customer pays for that good is one year or less, the Group does not adjust the promised amount of consideration for the effects of a significant financing component.

1) Revenue from the sale of goods

Revenue from the sale of goods comes from sales of electric distribution, automobile parts, automation equipment and parts. Sales of goods are recognized as revenue when the goods are delivered to the customer’s specific location because it is the time when the customer has full discretion over the manner of distribution and price to sell the goods, has the primary responsibility for sales to future customers and bears the risks of obsolescence. Trade receivables and contract assets are recognized concurrently. Any amounts previously recognized as contract assets are reclassified to trade receivables when the remaining obligations are performed. When the customer initially purchases the goods, the transaction price received is recognized as a contract liability until the goods have been delivered to the customer.

2) Construction contract revenue

Customers control construction contract while they are construction in progress, and thus, the Group recognizes revenue over time. The Group measures the progress on the basis of costs incurred relative to the total expected costs as there is a direct relationship between the costs incurred and the progress of satisfying the performance obligations. Contract assets are recognized during the construction and are reclassified to trade receivables at the point at which the customer is invoiced. If the milestone payments exceed the revenue recognized to date, then the Group recognizes contract liabilities for the difference. Certain payments, which are retained by the customer as specified in the contract, are intended to ensure that the Group adequately completes all of its contractual obligations. Such retention receivables are recognized as contract assets until the Group satisfies its performance obligations.

n. Leases

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

1) The Group as lessor

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

Lease payments (less any lease incentives payable) from operating leases are recognized as income on a straight-line basis over the terms of the relevant leases. Initial direct costs incurred in obtaining operating leases are added to the carrying amounts of the underlying assets and recognized as expenses on a straight-line basis over the lease terms.

2) The Group as lessee

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

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

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

Lease liabilities are initially measured at the present value of the lease payments. The lease payments are discounted using the interest rate implicit in a lease, if that rate can be readily determined. If that rate cannot be readily determined, the lessee’s incremental borrowing rate will be used.

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. When there is a change in a lease term, a change in the amounts expected to be payable under a residual value guarantee, a change in the assessment of an option to purchase an underlying asset, or a change in future lease payments resulting from a change in an index or a rate used to determine those payments, the Group remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. Lease liabilities are presented on a separate line in the consolidated balance sheets.

o. Borrowing costs

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

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

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

p. Government grants

Government grants are not recognized until there is reasonable assurance that the Group will comply with the conditions attached to them and that the grants will be received.

Government grants are recognized in profit or loss on a systematic basis over the periods in which the Group recognizes as expenses the related costs for which the grants are intended to compensate. Specifically, government grants whose primary condition is that the Group should purchase, construct or otherwise acquire non-current assets are recognized as deferred revenue and transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets.

Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the Group with no future related costs are recognized in profit or loss in the period in which they become receivable.

25 -

q. Employee benefits

1) Short-term employee benefits

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

2) Retirement benefits

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

Defined benefit costs (including service cost, net interest and remeasurement) under defined benefit retirement benefit plans are determined using the projected unit credit method. Service cost (including current service cost and past service cost) and net interest on the net defined benefit liability (asset) are recognized as employee benefits expense in the period they occur, or when the plan amendment or curtailment occurs. Remeasurement, comprising actuarial gains and losses, effect of changes to asset ceiling and return on plan assets (excluding interest), is recognized in other comprehensive income in the period in which it occurs. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to profit or loss.

Net defined benefit liability (asset) represents the actual deficit (surplus) in the Group’s defined benefit plan. Any surplus resulting from this calculation is limited to the present value of any refunds from the plans or reductions in future contributions to the plans.

3) Termination benefits

A liability for a termination benefit is recognized at the earlier of when the Group can no longer withdraw the offer of the termination benefit and when the Group recognizes any related restructuring costs.

r. Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax.

1) Current tax

Income tax payable (recoverable) is based on taxable profit (loss) for the year determined according to the applicable tax laws of each tax jurisdiction.

According to the Income Tax Act in the ROC, an additional tax on unappropriated earnings is provided for as income tax in the year the shareholders approve to retain the earnings.

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

2) Deferred tax

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

26 -

Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences, unused loss carryforwards and unused tax credits for purchases of machinery, equipment and technology, research and development expenditures, and personnel training expenditures to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries, except where the Corporation is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are recognized only to the extent that it is probable that there will be sufficient taxable profits against which to utilize the benefits of the temporary differences and such temporary differences are expected to reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. A previously unrecognized deferred tax asset is also reviewed at the end of each reporting period and recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liabilities are settled or the assets are realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

3) Current tax and deferred tax

Current tax and deferred taxes are recognized in profit or loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred taxes are also recognized in other comprehensive income or directly in equity, respectively.

MATERIAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Group’s accounting policies, management is required to make judgments, estimations, and assumptions on the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered relevant. Actual results may differ from these estimates.

When developing material accounting estimates, the Group considers the possible impact of US reciprocal tariffs on the cash flow projection, growth rates, discount rates, profit abilities and other relevant material estimates. The estimates and underlying assumptions are reviewed on an ongoing basis.

Based on the assessment of the Group’s management, the accounting policies, estimates, and assumptions adopted by the Group have not been subject to material accounting judgments, estimates and assumptions uncertainty.

27 -

28 -

6. CASH AND CASH EQUIVALENTS

	December 31
	2025	2024
Cash on hand	$ 5,445	$ 7,897
Checking accounts and demand deposits	3,842,880	3,016,993
Cash equivalents (investments with original maturities of less than 3 months)
Time deposits	245,933	345,756
Commercial paper	1,000,000	-
	$ 5,094,258	$ 3,370,646

The market rate intervals of cash in the bank at the end of the reporting period were as follows:

	December 31
	2025	2024
Bank balance	0.0001%-3.35%	0.0001%-3.57%

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

	December 31
	2025	2024
Financial assets - non-current
Financial assets mandatorily classified as at FVTPL
Derivative financial assets (not under hedge accounting)
Unlisted shares	$ 10,722	$ 14,166
Limited partnership	45,736	14,784
Mutual funds	770,457	882,630
	$ 826,915	$ 911,580

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

	December 31
	2025	2024
Non-current
Listed shares	$ 985,991	$ 1,584,859
Unlisted shares	1,471,469	1,465,644
	$ 2,457,460	$ 3,050,503

These investments are held for medium- to long-term strategic purposes. Accordingly, the management elected to designate these investments in equity instruments as at FVTOCI as they believe that recognizing short-term fluctuations in these investments' fair value in profit or loss would not be consistent with the Group's strategy of holding these investments for long-term purposes.

9. NOTES RECEIVABLE AND TRADE RECEIVABLES

	December 31
	2025	2024
Notes receivable
At amortized cost
Gross carrying amount	$ 1,005,650	$ 982,689
Trade receivables
At amortized cost
Gross carrying amount	$ 6,180,107	$ 6,529,122
Less: Allowance for impairment loss	(120,517)	(119,249)
	$ 6,059,590	$ 6,409,873

The average credit period of sales of goods is 90 days. In order to minimize credit risk, the Group authorized a department to be responsible for determining credit limits, credit approvals, credit management and to manage other unusual risk to ensure that follow-up action is taken to recover overdue debts. In addition, the Group reviews the recoverable amount of each individual trade debt at the end of the reporting period to ensure that adequate allowance is made for possible irrecoverable amounts.

The Group applies the simplified approach to providing for expected credit losses prescribed by IFRS 9, which permits the use of lifetime expected loss provision for all trade receivables. The expected credit losses on trade receivables are estimated by reference to past default experience of the debtor and an analysis of the debtor's current financial position, adjusted for general economic conditions of the industry in which the debtors operate and an assessment of the current direction of economic conditions at the reporting date.

The Group writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery. For trade receivables that have been written off, the Group continues to engage in enforcement activity to attempt to recover the receivables due. Where recoveries are made, these are recognized in profit or loss.

The following table details the loss allowance of notes receivable and trade receivables based on the Group's provision matrix.

December 31, 2025

	Not Past Due	Past Due Less than 3 Months	Past Due 3 to 6 Months	Past Due 6 Months to 1 Year	Past Due 1+ Year	Total
Expected credit loss rate	0.17%	5.12%	21.71%	57.67%	100.00%
Gross carrying amount	$ 6,263,189	$ 668,625	$ 215,674	$ 23,002	$ 15,267	$ 7,185,757
Loss allowance (Lifetime ECLs)	(10,938)	(34,229)	(46,817)	(13,266)	(15,267)	(120,517)
Amortized cost	$ 6,252,251	$ 634,396	$ 168,857	$ 9,736	$ -	$ 7,065,240

December 31, 2024

	Not Past Due	Past Due Less than 3 Months	Past Due 3 to 6 Months	Past Due 6 Months to 1 Year	Past Due 1+ Year	Total
Expected credit loss rate	0.22%	6.48%	25.83%	56.77%	99.39%
Gross carrying amount	$ 6,649,259	$ 731,072	$ 80,502	$ 33,029	$ 17,949	$ 7,511,811
Loss allowance (Lifetime ECLs)	(14,459)	(47,410)	(20,791)	(18,749)	(17,840)	(119,249)
Amortized cost	$ 6,634,800	$ 683,662	$ 59,711	$ 14,280	$ 109	$ 7,392,562

The movements of the loss allowance of notes receivable and trade receivables were as follows:

	2025	2024
Balance on January 1	$ 119,249	$ 151,686
Add: Net remeasurement of loss allowance	19,091	-
Less: Amounts written off	(16,335)	(2,431)
Less: Net remeasurement of loss allowance	-	(32,227)
Foreign exchange gains and losses	(1,488)	2,221
Balance on December 31	$ 120,517	$ 119,249

10. INVENTORIES

	December 31
	2025	2024
Finished goods	$ 5,342,885	$ 3,702,022
Work in progress	5,235,262	4,747,345
Raw materials	1,505,101	1,403,960
	$ 12,083,248	$ 9,853,327

The cost of goods sold included inventory write-downs of $11,623 thousand and $22,264 thousand for the years ended December 31, 2025 and 2024, respectively.

11. SUBSIDIARIES

Subsidiaries Included in the Consolidated Financial Statements

Investor	Investee	Nature of Activities	Proportion of Ownership	Remark
December 31	2025	2024
The Corporation	SEEC International Holdings Ltd. of the British Virgin Islands (“SEEC International Holdings”)	Investment and trade business	100.0%	100.0%
The Corporation	Shihlin Electrical Engineering Ltd. of Vietnam (“Shihlin Electric Vietnam”)	Electrical goods production	100.0%	100.0%
The Corporation	Shihlin Electric USA Company Limited (“Shihlin Electric USA”)	Heavy electrical equipment product marketing promotion services	100.0%	100.0%
The Corporation	Hsin Lin Electric Machinery Co., Ltd. (“Hsin Lin”)	Power transmission, distribution and machinery equipment manufacturing and sales	60.0%	60.0%

(Continued)

Investor	Investor	Nature of Activities	Proportion of Ownership		Remark
			December 31	2025
The Corporation	Tingling Enterprise Co., Ltd. (“Tingling”)	Mechanical and electrical appliances various components manufacturing and processing and installation business	96.7%	96.7%
The Corporation	Shihlin Electric Green Power Corp. (Shihlin Electric Green Power)	Investment consulting, management consulting, leasing, power generation, power transmission, power distribution machinery manufacturing, renewable energy self-used power generation equipment, energy technology service	100.0%	100.0%
The Corporation	Shilin Star Power Corporation (Shihlin Star Power)	Manufacture of equipment for electric vehicle charging piles and optical charging and storage solutions.	51.0%	51.0%	b
The Corporation and Hsin Lin	Hwo Lin Investment Co., Ltd. (“Hwo Lin”)	Investment	99.9%	99.9%
The Corporation	Cheng Lin Investments Co., Ltd. (“Cheng Lin”)	Investment	99.7%	99.6%	a and c
The Corporation	Shang Lin Investment Co., Ltd. (“Shang Lin”)	Investment	99.6%	99.6%
The Corporation	Ji Lin Investment, Co., Ltd. (“Ji Lin”)	Investment	99.9%	99.9%
The Corporation and Hsin Lin	Yuh Lin Investment Co., Ltd. (“Yuh Lin”)	Investment	99.9%	99.9%
The Corporation and Hsin Lin	Jeng Lin Investment Co., Ltd. (“Jeng Lin”)	Investment	99.9%	99.9%
The Corporation and Cheng Lin	Chuan Lin Scien-Technical Corp. (“Chuan Lin”)	Operating and sale and maintenance service of vending machines, heavy electrical machinery and mechanical appliances and automation equipment	73.0%	73.0%
The Corporation, Cheng Lin and Chuan Lin	Ruei Lin Electric & Engineering Corp. (“Ruei Lin”)	Manufacturing and trading of mechanical appliances and vehicle components	91.3%	91.3%
The Corporation	Jeen-Lin Industrial Co., Ltd. (“Jeen-Lin”)	Manufacturing and sale of aluminum alloy die-casting, lathe, cutting and molding	78.4%	78.4%
Hsin Lin and Ruei Lin	Wuling Electric Co., Ltd. (“Wuling”)	Manufacturing, processing and sales of mechanical and electrical parts, power distribution equipment and switch products	60.0%	60.0%
Hsin Lin	Hsinlin International Investment Corp. of Samoa (“Hsinlin International Investment”)	Investment	100.0%	100.0%
SEEC International Holdings	Changzhou Shihlin Mitsuba Electric & Engineering Co., Ltd. (“Changzhou Shihlin Mitsuba”)	Manufacturing and sale of motorcycle starter motors, magneto, starter switch	55.0%	55.0%
SEEC International Holdings	Xiamen Shihlin Electric & Engineering Co., Ltd. (“Xiamen SEEC”)	Manufacturing and sale of capacitors, relays, circuit breakers and other components	100.0%	100.0%
SEEC International Holdings	Suzhou Shihlin Electric & Engineering Co., Ltd. (“Suzhou SEEC”)	Manufacturing and sale of capacitors, transformers, DC electric motors and other electronic components	100.0%	100.0%
SEEC International Holdings	Wuxi Shihlin Electric & Electric & Engineering Co., Ltd. (“Wuxi SEEC”)	Manufacturing and sale of magneto and starter motor in locomotive transmission facilities, power generators	100.0%	100.0%
SEEC International Holdings	Shihlin Technology (Shenzhen) Co., Ltd. (“Shenzhen Shihlin”)	Manufacturing and sale of industrial automation equipment and related products	100.0%	100.0%
SEEC International Holdings and Hsinlin International Investment	Shihlin Electric (Suzhou) Power Equipment Co., Ltd. (“Suzhou Power Equipment”)	Manufacturing and sale of high and low pressure switch and related products	70.5%	70.5%
SEEC International Holdings	Xiamen Chen-Inx Transportation Implements Co., Ltd. (“Xiamen Chen-Inx”)	Manufacturing motorcycle metal materials, electronic parts, all kinds of punch products parts, machine tools, etc.	100.0%	100.0%
SEEC International Holdings	Changzhou Shihlin Auto Parts Co., Ltd. (“Changzhou Shihlin Parts”)	Manufacturing and sale of motorcycle starter motors, magneto, starter switch	100.0%	100.0%
Ruei Lin	Shihlin Electric Engineering Equipment Vietnam Company Limited (“Vietnam Electric Engineering)	Manufacturing and sale of mechanical equipment, power transmission, distribution and machinery equipment, automotive and motorcycle components	100.0%	100.0%
Hwo Lin and Ji Lin	Yeangder Entertainment Co., Ltd. (“Yeangder Entertainment”)	Engaged in competitive and recreational sports industry	99.9%	99.9%

(Concluded)

Remarks:

a. In March 2024, the Group did not subscribe additional new shares of Cheng Lin at existing ownership percentage; the amount was $80,000 thousand, which increased the ownership percentage from 99.5% to 99.6%.

b. In April 2024, the Group established Shihlin Star Power with a registered capital of $80,000 thousand, representing 51% of shareholding.

c. In March 2025, the Group did not subscribe additional new shares of Cheng Lin at existing ownership percentage; the amount was $80,000 thousand, which increased the ownership percentage from 99.6% to 99.7%.

INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Investments in Associates

	December 31
	2025	2024
Investments in associates
Material associate
The Ambassador Hotel Co., Ltd. (“Ambassador Hotel”)	$ 6,975,358	$ 7,452,858
Associates that are not individually material	5,795,855	7,243,991
	$ 12,771,213	$ 14,696,849

a. Material associate

	Proportion of Ownership and Voting Rights
	December 31
Name of Associate	2025	2024
Ambassador Hotel	21.34%	21.34%

Refer to Table 6 “Information on Investees” for the nature of activities, principal place of business and country of incorporation of the associate.

Fair value (Level 1) of investment in associate with available published price quotation is as follows:

	December 31
Name of Associate	2025	2024
Ambassador Hotel	$ 3,379,405	$ 4,315,301

The investment in associate is accounted for using the equity method.

Summarized financial information of the Group's material associate set out below represents amounts shown in the associate's financial statements prepared in accordance with IFRS Accounting Standards adjusted by the Group for equity accounting purposes.

Ambassador Hotel

	December 31
	2025	2024
Current assets	$ 21,353,171	$ 21,484,471
Non-current assets	19,702,452	20,613,248
Current liabilities	(3,724,454)	(2,692,269)
Non-current liabilities	(4,646,447)	(4,483,521)
Equity	32,684,722	34,921,929
Non-controlling interests	(4,615)	(4,702)
	$ 32,680,107	$ 34,917,227
Proportion of the Group’s ownership	21.34%	21.34%
Equity attributable to the Group	$ 6,975,358	$ 7,452,858
Other adjustments	-	-
Carrying amount	$ 6,975,358	$ 7,452,858
	For the Year Ended December 31
	2025	2024
Operating revenue	$ 1,357,085	$ 1,302,587
Net profit for the year	$ 232,655	$ 1,036,856
Other comprehensive (loss) income	(2,289,605)	7,443,049
Total comprehensive (loss) income for the year	$ (2,056,950)	$ 8,479,905
Dividends received from Ambassador Hotel	$ 39,159	$ 78,318

b. Aggregate information of associates that are not individually material

	For the Year Ended December 31
	2025	2024
The Group’s share of:
Net (loss) profit for the year	$ (36,494)	$ 112,029
Other comprehensive (loss) income	(721,242)	1,204,684
Total comprehensive (loss) income for the year	$ (757,736)	$ 1,316,713

The amounts of investments in associates pledged as collateral for bank borrowings were disclosed in Note 30.

13. PROPERTY, PLANT AND EQUIPMENT

	Freehold Land	Buildings	Machinery and Equipment	Other Equipment	Construction in Progress and Equipment under Installation	Total
Cost
Balance on January 1, 2025	$ 2,698,664	$ 5,103,456	$ 6,065,485	$ 3,237,906	$ 123,974	$ 17,229,485
Additions	17,553	195,170	448,670	156,329	133,021	950,743
Disposals	-	(9,367)	(241,543)	(153,965)	(9,990)	(414,865)
Transferred from inventories	-	-	1,010	19,910	22,399	43,319
Reclassification	-	114,999	51,441	19,643	(178,154)	7,929
Effect of foreign currency exchange differences	(799)	(40,696)	(50,235)	(20,001)	(896)	(112,627)
Balance on December 31, 2025	$ 2,715,418	$ 5,363,562	$ 6,274,828	$ 3,259,822	$ 90,354	$ 17,703,984
Accumulated depreciation and impairment
Balance on January 1, 2025	$ -	$ 2,887,431	$ 4,233,540	$ 2,585,608	$ -	$ 9,706,579
Disposals	-	(8,762)	(200,532)	(127,564)	-	(336,858)
Reclassification	-	(3,970)	(11,255)	15,225	-	-
Depreciation expense	-	149,656	352,999	174,820	-	677,475
Effect of foreign currency exchange differences	-	(12,565)	(28,835)	(13,729)	-	(55,129)
Balance on December 31, 2025	$ -	$ 3,011,790	$ 4,345,917	$ 2,634,360	$ -	$ 9,992,067
Carrying amounts on December 31, 2025	$ 2,715,418	$ 2,351,772	$ 1,928,911	$ 625,462	$ 90,354	$ 7,711,917
Cost
Balance on January 1, 2024	$ 2,707,028	$ 4,852,437	$ 5,843,921	$ 3,079,671	$ 130,661	$ 16,613,718
Additions	-	148,411	382,993	151,625	127,178	810,207
Disposals	(9,806)	(10,234)	(267,140)	(95,969)	-	(383,149)
Transferred from inventories	-	-	-	20,150	11,913	32,063
Reclassification	-	51,641	44,235	42,738	(146,757)	(8,143)
Effect of foreign currency exchange differences	1,442	61,201	61,476	39,691	979	164,789
Balance on December 31, 2024	$ 2,698,664	$ 5,103,456	$ 6,065,485	$ 3,237,906	$ 123,974	$ 17,229,485
Accumulated depreciation and impairment
Balance on January 1, 2024	$ -	$ 2,745,374	$ 4,103,830	$ 2,451,795	$ -	$ 9,300,999
Disposals	-	(7,897)	(248,964)	(84,822)	-	(341,683)
Reclassification	-	(4,223)	22	4,201	-	-
Reversal of impairment losses	-	-	(279)	(599)	-	(878)
Depreciation expense	-	130,317	342,021	185,269	-	657,607
Effect of foreign currency exchange differences	-	23,860	36,910	29,764	-	90,534
Balance on December 31, 2024	$ -	$ 2,887,431	$ 4,233,540	$ 2,585,608	$ -	$ 9,706,579
Carrying amounts on December 31, 2024	$ 2,698,664	$ 2,216,025	$ 1,831,945	$ 652,298	$ 123,974	$ 7,522,906

The Corporation adopted depreciation methods that were decided at the dates the assets were acquired. The Corporation's depreciation cost is calculated by using the straight-line method for properties bought before January 1, 1988 and on or after January 1, 1999. The Corporation's depreciation cost is calculated by using the fixed-percentage-of-declining-balance method for properties bought in the period from January 1, 1988 to December 31, 1998. The remaining subsidiaries calculate depreciation cost by using the straight-line method.

The above items of property, plant and equipment are depreciated on a straight-line basis over their estimated useful lives of the assets as follows:

Building
Main buildings	40-60 years
Building improvements	20-35 years
Electrical power equipment and engineering system	8-35 years
Others	2-15 years
Machinery and equipment	2-20 years
Other equipment	2-30 years

Property, plant and equipment used by the Group and pledged as collateral for bank borrowings are set out in Note 30.

14. LEASE ARRANGEMENTS

a. Right-of-use assets

	December 31
	2025	2024
Carrying amounts
Land	$ 166,258	$ 176,632
Buildings	31,101	16,655
Transportation equipment	1,549	1,068
	$ 198,908	$ 194,355
	For the Year Ended December 31
	2025	2024
Additions to right-of-use assets	$ 35,344	$ 16,659
Depreciation charge for right-of-use assets
Land	$ 5,085	$ 5,287
Buildings	18,280	8,746
Transportation equipment	1,435	1,384
	$ 24,800	$ 15,417

b. Lease liabilities

	December 31
	2025	2024
Carrying amounts
Current	$ 22,150	$ 9,016
Non-current	$ 11,318	$ 9,293

Range of discount rates for lease liabilities was as follows:

	December 31
	2025	2024
Buildings	0.61%-4.79%	0.61%-4.79%
Transportation equipment	0.84%-1.99%	0.84%-1.99%

c. Other lease information

Lease arrangements under operating leases of the Group as lessor of investment properties are set out in Note 15.

	For the Year Ended December 31
	2025	2024
Expenses relating to short-term leases	$ 31,074	$ 35,976
Total cash outflow for leases	$ (50,072)	$ (46,109)

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

15. INVESTMENT PROPERTIES

	Completed Investment Property
Cost
Balance on January 1, 2025	$ 10,479,625
Additions	5,353
Balance on December 31, 2025	$ 10,484,978
Accumulated depreciation and impairment
Balance on January 1, 2025	$ 3,492,657
Depreciation expense	94,946
Balance on December 31, 2025	$ 3,587,603
Carrying amount on December 31, 2025	$ 6,897,375
Cost
Balance on January 1, 2024	$ 10,477,462
Additions	2,163
Balance on December 31, 2024	$ 10,479,625
	(Continued)

Completed Investment Property

Accumulated depreciation and impairment

Balance on January 1, 2024
$ 3,391,646
Depreciation expense
101,011
Balance on December 31, 2024
$ 3,492,657
Carrying amount on December 31, 2024
$ 6,986,968
(Concluded)

The abovementioned investment properties were leased out for 1 to 20 years. The lessees do not have bargain purchase options to acquire the investment properties at the expiry of the lease periods.

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

	December 31
	2025	2024
Not later than 1 year	$ 418,779	$ 405,273
Later than 1 year and not later than 5 years	890,198	1,170,274
Later than 5 years	-	11,801
	$ 1,308,977	$ 1,587,348

In addition to the minimum lease payments receivable, the contract for the Group's lease of mall building and parking spaces to Pacific Sogo Department Store Company Limited included contingent rentals clause, which provides that the Group shall receive shopping mall's monthly minimum guaranteed rent (minimum guaranteed rent at 6% of revenue) and car parking spaces rent, and at each year end, an extra operating lease payment will be charged if the actual revenue exceeds the minimum revenue base of the guaranteed 6% of revenue.

Investment properties were depreciated by applying straight-line method (before January 1, 1988 and on or after January 1, 1999) or fixed-percentage-of-declining-balance method (in the period from January 1, 1988 to December 31, 1998) over their estimated useful lives of the assets:

Main buildings
50-60 years
Engineering system
5-15 years
Air-conditioning system
8-10 years
Others
5-15 years

The fair value of the Group's investment properties as of December 31, 2025 and 2024 was $20,558,323 thousand and $20,871,653 thousand, respectively. The fair value was based on the valuations carried out on January 13, 2025 and 2024 by independent qualified professional valuers. The valuation was carried out by reference to sales comparison approach and income approach.

Refer to Note 30 for the carrying amount of investment properties pledged to secure general banking facilities granted to the Group.

37 -

38 -

16. OTHER ASSETS

	December 31
	2025	2024
Current
Prepayments for purchases	$ 2,483,582	$ 1,614,742
Prepaid expenses	321,215	247,414
Refundable deposits	32,501	3,448
Other financial assets	79,588	286,307
Others	36,698	23,147
	$ 2,953,584	$ 2,175,058

17. BORROWINGS

Short-term borrowings

	December 31
	2025	2024
Secured borrowings (Note 30)
Bank loans (NTD)	$ 98,100	$ 102,100
Unsecured borrowings
Bank loans (NTD)	1,005,000	705,000
Bank loans (RMB)	225,816	120,862
Bank loans (EUR)	-	3,235
Bank loans (JPY)	-	1,055
Bank loans (USD)	-	-
	1,230,816	830,152
	$ 1,328,916	$ 932,252

The range of weighted average effective interest rates on bank loans were 1.73%-3.00% and 1.45%-3.78% per annum as of December 31, 2025 and 2024, respectively.

18. OTHER PAYABLES

	December 31
	2025	2024
Payable for salaries and bonus	$ 695,649	$ 689,515
Payable for employees' compensation	214,406	186,766
Payable for annual leave	107,418	103,186
Payable for remuneration of directors	100,000	84,000
Payable for dividends	73,747	73,751
Others	771,318	756,476
	$ 1,962,538	$ 1,893,694

39 -

19. PROVISIONS

	December 31
	2025	2024
Current
Warranties	$ 1,926,077	$ 1,837,632
Non-current
Warranties	$ 37,391	$ 32,671
		Warranties
Balance on January 1, 2025		$ 1,870,303
Additional provisions recognized		94,753
Effect of foreign currency exchange differences		(1,588)
Balance on December 31, 2025		$ 1,963,468

The provision for warranty claims represents the present value of management’s best estimate of the future outflow of economic benefits that will be required under the Group’s obligations for warranties under contracts for the sale of goods. The estimate has been made on the basis of historical warranty trends and may vary as a result of other events affecting product quality.

20. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

The Corporation and domestic subsidiaries of the Group adopted a pension plan under the Labor Pension Act (LPA), which is a state-managed defined contribution plan. Under the LPA, an entity makes monthly contributions to employees’ individual pension accounts at 6% of monthly salaries and wages. According to local regulations, foreign subsidiaries also make contributions to employees’ individual accounts under a defined contribution plan.

b. Defined benefit plans

The defined benefit plan adopted by the Corporation and domestic subsidiaries of the Group in accordance with the Labor Standards Act is operated by the government of the Republic of China (ROC). Pension benefits are calculated on the basis of the length of service and average monthly salaries of the six months before retirement. The Group and domestic subsidiaries of the Group contribute at specific rate of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the committee’s name. Before the end of each year, the Group assesses the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Group is required to fund the difference in one appropriation that should be made before the end of March of the next year. The pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the “Bureau”); the Group has no right to influence the investment policy and strategy.

The amounts included in the consolidated balance sheets in respect of the Group's defined benefit plans were as follows:

	December 31
	2025	2024
Present value of defined benefit obligation	$ 1,204,846	$ 1,132,341
Fair value of plan assets	(1,047,681)	(990,618)
Net defined benefit liability	$ 157,165	$ 141,723

Movements in net defined benefit liabilities (assets) were as follows:

	Present Value of the Defined Benefit Obligation	Fair Value of the Plan Assets	Net Defined Benefit Liability (Asset)
Balance on January 1, 2024	$ 1,272,172	$ (1,010,649)	$ 261,523
Service cost
Current service cost	6,685	-	6,685
Past service cost	158	-	158
Net interest expense (income)	15,821	(12,767)	3,054
Recognized in profit or loss	22,664	(12,767)	9,897
Remeasurement
Return on plan assets (excluding amounts included in net interest)	-	(97,540)	(97,540)
Actuarial loss - changes in financial assumptions	(14,894)	-	(14,894)
Actuarial loss - experience adjustments	46,098	-	46,098
Recognized in other comprehensive income	31,204	(97,540)	(66,336)
Contributions from the employer	-	(39,767)	(39,767)
Benefits paid	(193,699)	170,105	(23,594)
Balance on December 31, 2024	1,132,341	(990,618)	141,723
Service cost
Current service cost	4,656	-	4,656
Past service cost	499	-	499
Net interest expense (income)	18,270	(16,305)	1,965
Recognized in profit or loss	23,425	(16,305)	7,120
Remeasurement
Return on plan assets (excluding amounts included in net interest)	-	(72,063)	(72,063)
Actuarial loss - changes in financial assumptions	27,340	-	27,340
Actuarial loss - experience adjustments	108,709	-	108,709
Recognized in other comprehensive income	136,049	(72,063)	63,986
Contributions from the employer	-	(41,915)	(41,915)
Benefits paid	(86,969)	73,220	(13,749)
Balance on December 31, 2025	$ 1,204,846	$ (1,047,681)	$ 157,165

Through the defined benefit plans under the Labor Standards Act, the Group is exposed to the following risks:

1) Investment risk: The plan assets are invested in domestic and foreign equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets should not be below the interest rate for a 2-year time deposit with local banks.

2) Interest risk: A decrease in government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plan’s debt investments.

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

The actuarial valuations of the present value of the defined benefit obligation were carried out by qualified actuaries. The significant assumptions used for the purposes of the actuarial valuations were as follows:

	December 31
	2025	2024
Discount rate	1.375%	1.500%-1.625%
Expected rate of salary increase	2.500%-2.750%	2.500%-2.750%

If possible reasonable change in each of the significant actuarial assumptions occurs and all other assumptions will remain constant, the present value of the defined benefit obligation will increase (decrease) as follows:

	December 31
	2025	2024
Discount rate
0.250% increase	$(27,469)	$(27,066)
0.250% decrease	$28,356	$27,973
Expected rate of salary increase
0.250% increase	$27,509	$27,186
0.250% decrease	$(26,789)	$(26,443)

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

	December 31
	2025	2024
The expected contributions to the plan for the next year	$41,977	$39,873
The average duration of the defined benefit obligation	7.2-9.5 years	7.5-10.1 years

42 -

21. EQUITY

a. Share capital - ordinary shares

	December 31
	2025	2024
Number of authorized shares (in thousands)	580,000	580,000
Amount of authorized shares	$ 5,800,000	$ 5,800,000
Number of issued and fully paid shares (in thousands)	520,972	520,972
Amounted of issued and fully paid shares	$ 5,209,722	$ 5,209,722

b. Capital surplus

	December 31
	2025	2024
May be used to offset a deficit, distributed, as cash dividends, or transferred to share capital (1)
Arising from issuance of common share	$ 1,441,424	$ 1,441,424
Arising from conversion of bonds	970,457	970,457
Arising from treasury share transactions	68,529	68,529
Arising from the difference between consideration received or paid and the carrying amount of the subsidiaries’ net assets during actual disposal or acquisition	75,096	75,096
May only be used to offset a deficit
Arising from changes in percentage of ownership interest in subsidiaries (2)	12,802	12,425
Arising from changes in equity from investments in associates accounted for using the equity method	227,747	125,843
Arising from treasury share transactions	1,530	1,530
	$ 2,797,585	$ 2,695,304

1) Such capital surplus may be used to offset a deficit; in addition, when the Group has no deficit, such capital surplus may be distributed as cash dividends or transferred to share capital (limited to a certain percentage of Group’s capital surplus and once a year).

2) Such capital surplus arises from the effect of changes in ownership interest in a subsidiary resulted from equity transactions other than actual disposal or acquisition, or from changes in capital surplus of subsidiaries accounted for using the equity method.

c. Retained earnings and dividend policy

Under the dividend policy in the Corporation’s Articles, where the Corporation made a profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous years, setting aside 10% of the remaining profit as a legal reserve, setting aside a special reserve in accordance with the laws and regulations, and then any remaining profit together with any undistributed retained earnings shall be used by the Company’s board of directors as the basis for proposing a distribution plan, which should be resolved in the shareholders’ meeting for the distribution of dividends and bonuses to shareholders. For the policies on the distribution of employees’ compensation and remuneration of directors after the amendment, refer to “employees’ compensation and remuneration of directors” in Note 23, h.

The Corporation’s Articles also prescribe that 1) not less than 5% of the sum of the remaining annual net income and the previous year’s accumulated undistributed earnings shall be appropriated as dividends and 2) of the total dividends, not less than 20% shall be paid in cash. The actual distribution ratio or method of dividend distribution is subjected to the operating situation as determined by the Corporation’s board of directors as the basis for proposing a distribution plan, which should be resolved in the shareholders meeting for the distribution of dividends to shareholders.

An appropriation of earnings to a legal reserve shall be made until the legal reserve equals the Group’s paid-in capital. The legal reserve may be used to offset any deficits. If the Group has no deficit and the legal reserve has exceeded 25% of the Group’s paid-in capital, the excess may be transferred to capital or distributed in cash.

Items referred to under Rule No. 1010012865 issued by the FSC and the directive titled “Questions and Answers for Special Reserves Appropriated Following Adoption of IFRS Accounting Standards” shall be appropriated to or reversed from a special reserve by the Corporation.

The appropriations of earnings for 2024 and 2023, which were approved in the shareholders’ meetings on June 13, 2025 and June 19, 2024, respectively, were as follows:

	For the Year Ended December 31
	2024	2023
Legal reserve	$ 317,383	$ 246,791
Cash dividends	$ 2,344,375	$ 1,562,917
Cash dividends per share (NT$)	$ 4.5	$ 3.0

The appropriation of earnings for 2025, which were proposed by the Corporation’s board of directors on March 12, 2026, were as follows:

	For the Year Ended December 31, 2025
Legal reserve	$ 316,999
Cash dividends	$ 2,604,861
Cash dividends per share (NT$)	$ 5.0

The appropriations of earnings for 2025 will be resolved by the shareholders in their meeting to be held on June 17, 2026.

43 -

d. Special reserves

	For the Year Ended December 31
	2025	2024
Balance on January 1 and balance on December 31	$ 5,136,954	$ 5,136,954

The special reserve appropriated on the first-time adoption of IFRS Accounting Standards relating to land may be reversed on the disposal or reclassification of the related assets. An additional special reserve should be appropriated for the amount equal to the difference between the reversed net debit balance and the appropriated special reserve on the first-time adoption of IFRS Accounting Standards. Any appropriated special reserve may be reversed to the extent that the net debit balance has reversed and, thereafter, is distributed.

e. Other equity items

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

	For the Year Ended December 31
	2025	2024
Balance on January 1	$ (101,517)	$ (326,477)
Recognized for the year
Exchange differences on translating the financial statements of foreign operations	(183,373)	224,960
Other comprehensive (loss) income recognized for the year	(183,373)	224,960
Balance on December 31	$ (284,890)	$ (101,517)

2) Unrealized gain (loss) on financial assets at FVTOCI

	For the Year Ended December 31
	2025	2024
Balance on January 1	$ 7,685,084	$ 4,444,837
Recognized for the year
Unrealized (loss) gain - equity instruments	(750,431)	717,571
Share from associates accounted for using the equity method	(1,189,399)	2,667,255
Other comprehensive (loss) income recognized for the year	(1,939,830)	3,384,826
Transfer of accumulated gain or loss on disposal of equity instruments to retained earnings	(50,372)	(144,765)
Cumulative unrealized gain of equity instruments transferred to retained earnings due to disposal (Note 26)	346	186
Balance on December 31	$ 5,695,228	$ 7,685,084

f. Non-controlling interests

	For the Year Ended December 31
	2025	2024
Balance on January 1	$ 837,159	$ 718,964
Share of profit for the year	109,817	117,997
Other comprehensive (loss) income during the period
Exchange difference on translating the financial statements of foreign entities	(9,698)	18,882
Unrealized (loss) gain on financial assets at FVTOCI	(487)	1,082
Remeasurement of defined benefit plans	(40)	99
Share from remeasurement of defined benefit plans of associates accounted for using the equity method	(1)	3
Share from other comprehensive (loss) income of associates accounted for using the equity method	(20,303)	34,894
Adjustment to changes in equity of associates accounted for using the equity method	(4,398)	(1,039)
Adjustment to changes in equity of subsidiaries (Note 26)	(723)	(340)
Acquisition of non-controlling interests in subsidiaries	-	39,200
Cash dividends of subsidiaries distributed to non-controlling interests	(85,133)	(92,583)
Balance on December 31	$ 826,193	$ 837,159

REVENUE

a. Contract balances

	December 31, 2025	December 31, 2024	January 1, 2024
Notes receivable (Note 9)	$ 1,005,650	$ 982,689	$ 1,201,258
Trade receivables, net (Note 9)	$ 6,059,590	$ 6,409,873	$ 6,284,399
Trade receivables from related parties (Note 29)	$ 186,403	$ 129,057	$ 131,966
Contract assets
Sale of goods	$ 650,597	$ 644,770	$ 576,522
Construction contracts	1,084,744	940,544	1,126,300
Contract assets - current	$ 1,735,341	$ 1,585,314	$ 1,702,822
Contract liabilities
Sale of goods	$ 7,802,646	$ 4,760,660	$ 5,419,865
Construction contracts	1,742,098	521,130	1,159,521
Contract liabilities - current	$ 9,544,744	$ 5,281,790	$ 6,579,386

The credit risk management of contract assets and trade receivables are the same, refer to Note 9.

b. Disaggregation of revenue

2025

	Electric Distribution Segment	Automobile Parts Segment	Automation Equipment and Parts Segment	Other Segment	Total
Type of goods or services
Sale of goods	$ 22,817,109	$ 5,443,903	$ 3,109,020	$ 521,750	$ 31,891,782
Construction contracts	4,020,080	-	767,927	-	4,788,007
Others	-	-	-	12,000	12,000
	$ 26,837,189	$ 5,443,903	$ 3,876,947	$ 533,750	$ 36,691,789

2024

	Electric Distribution Segment	Automobile Parts Segment	Automation Equipment and Parts Segment	Other Segment	Total
Type of goods or services
Sale of goods	$ 22,009,215	$ 5,948,348	$ 2,981,346	$ 609,522	$ 31,548,431
Construction contracts	2,537,795	-	492,924	-	3,030,719
Others	-	-	-	12,500	12,500
	$ 24,547,010	$ 5,948,348	$ 3,474,270	$ 622,022	$ 34,591,650

NET PROFIT

a. Interest income

For the Year Ended December 31
	2025	2024
Bank deposits	$ 26,426	$ 44,737
Others	10,205	3,916
	$ 36,631	$ 48,653

b. Other income

For the Year Ended December 31
	2025	2024
Dividends income
Investments in equity instruments at FVTOCI	$ 82,756	$ 64,348
Rental income	1,761	2,710
Others	2,472	4,003
	$ 86,989	$ 71,061

c. Other gains and losses

	For the Year Ended December 31
	2025	2024
Fair value changes of financial assets
Financial assets mandatorily classified as at FVTPL	$ (115,868)	$ 47,379
Gain (loss) on disposal of property, plant and equipment	625	(2,812)
Net foreign exchange (losses) gains	(35,433)	108,243
Others	(172)	61,499
	$ (150,848)	$ 214,309

d. Finance costs

	For the Year Ended December 31
	2025	2024
Interest on bank loans	$ 14,521	$ 18,657
Interest on finance leases	802	373
	$ 15,323	$ 19,030

e. Depreciation and amortization

	For the Year Ended December 31
	2025	2024
An analysis of depreciation by function
Operating costs	$ 630,450	$ 619,946
Operating expenses	166,771	154,089
	$ 797,221	$ 774,035
An analysis of amortization by function
Operating costs	$ 4,278	$ 4,661
Operating expenses	15,510	16,405
	$ 19,788	$ 21,066

f. Operating expenses directly related to investment properties

	For the Year Ended December 31
	2025	2024
Generated rental income	$ 47,256	$ 45,370

g. Employee benefits expense

	For the Year Ended December 31
	2025	2024
Post-employment benefits
Defined contribution plans	$ 177,363	$ 165,792
Defined benefit plans (Note 20)	7,120	9,897
	184,483	175,689
Other employee benefits	4,359,461	4,115,189
Total employee benefits expense	$ 4,543,944	$ 4,290,878
An analysis of employee benefits expense by function
Operating costs	$ 2,597,180	$ 2,394,736
Operating expenses	1,946,764	1,896,142
	$ 4,543,944	$ 4,290,878

h. Employees' compensation and remuneration of directors

According to the Company's Articles, the Company accrues compensation of employees and remuneration of directors at rates of no less than 1%-8% and no higher than 4%, respectively, of net profit before income tax, compensation of employees, and remuneration of directors and supervisors. The employees' compensation and remuneration of directors for the years ended December 31, 2025 and 2024, which were approved by the Corporation's board of directors on March 12, 2026 and March 6, 2025, respectively, were as follows:

Accrual rate

	For the Year Ended December 31
	2025	2024
Employees’ compensation	4.66%	4.24%
Remuneration of directors	2.33%	2.12%
Amount
	For the Year Ended December 31
	2025	2024
	Cash	Cash
Employees’ compensation	$ 200,000	$ 168,000
Remuneration of directors	100,000	84,000

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

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

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

49 -

24. INCOME TAXES

a. Income tax recognized in profit or loss

Major components of income tax expense are as follows:

	For the Year Ended December 31
	2025	2024
Current tax
In respect of the current year	$ 1,066,281	$ 881,957
Income tax on unappropriated earnings	8,292	5,417
Adjustments for prior years	(3,842)	26,094
	1,070,731	913,468
Deferred tax
In respect of the current year	(173,421)	(53,878)
Adjustments for prior years	(5,204)	62
	(178,625)	(53,816)
Income tax expense recognized in profit or loss	$ 892,106	$ 859,652

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

	For the Year Ended December 31
	2025	2024
Profit before tax	$ 4,269,733	$ 4,003,390
Income tax expense calculated at the statutory rate	$ 1,007,869	$ 981,666
Nondeductible expenses in determining taxable income	25,204	42,378
Tax-exempt income	(102,387)	(158,777)
Investment tax credits used in the current year	(37,199)	(34,751)
Loss tax credits used in the current year	(11)	(2,254)
Income tax on unappropriated earnings	8,292	5,417
Adjustments for prior years’ tax	(9,046)	26,156
Others	(716)	(183)
Income tax expense recognized in profit or loss	$ 892,106	$ 859,652

b. Income tax recognized in other comprehensive income

	For the Year Ended December 31
	2025	2024
Deferred tax
In respect of the current year
Translation of the financial statements of foreign operations	$ (46,498)	$ 56,619
Remeasurement on defined benefit plans	(12,797)	13,267
	$ (59,295)	$ 69,886

c. Current tax liabilities

	December 31
	2025	2024
Current tax liabilities
Income tax payable	$ 507,255	$ 442,757

d. Deferred tax assets and liabilities

The movements of deferred tax assets and deferred tax liabilities were as follows:

For the year ended December 31, 2025

	Opening Balance	Recognized in Profit or Loss	Recognized in Other Comprehensive Income	Closing Balance
Deferred tax assets
Temporary differences
Inventory write-downs	$ 46,572	$ 1,703	$ -	$ 48,275
Provisions	148,942	7,196	-	156,138
Defined benefit plans	28,345	(9,789)	12,797	31,353
Payable for annual leave	20,903	2,804	-	23,707
Exchange differences on translating the financial statements of foreign operations	35,104	-	40,784	75,888
Allowance for impairment loss on receivables	5,925	(832)	-	5,093
Deferred revenue	8,300	(374)	-	7,926
Investments accounted for using the equity method	2,136	(396)	-	1,740
Others	20,884	(2,925)	-	17,959
	$ 317,111	$ (2,613)	$ 53,581	$ 368,079
Deferred tax liabilities
Temporary differences
Depreciation differences on property, plant and equipment	$ 242,662	$ (446)	$ -	$ 242,216
Investments accounted for using the equity method	834,870	(169,350)	-	665,520
Reserve for land value increment tax	1,175,718	-	-	1,175,718
Rental revenue receivables	16,470	111	-	16,581
Exchange differences on translating the financial statements of foreign operations	5,714	-	(5,714)	-
Financial assets at FVTPL	47,049	(13,931)	-	33,118
Others	3,197	2,378	-	5,575
	$ 2,325,680	$ (181,238)	$ (5,714)	$ 2,138,728

For the year ended December 31, 2024

	Opening Balance	Recognized in Profit or Loss	Recognized in Other Comprehensive Income	Closing Balance
Deferred tax assets
Temporary differences
Inventory write-downs	$ 46,050	$ 522	$ -	$ 46,572
Provisions	123,985	24,957	-	148,942
Defined benefit plans	52,947	(11,335)	(13,267)	28,345
Payable for annual leave	17,425	3,478	-	20,903
Exchange differences on translating the financial statements of foreign operations	86,007	2	(50,905)	35,104
Allowance for impairment loss on receivables	6,169	(244)	-	5,925
Deferred revenue	8,095	205	-	8,300
Investments accounted for using the equity method	2,050	86	-	2,136
Others	21,463	(579)	-	20,884
	$ 364,191	$ 17,092	$ (64,172)	$ 317,111
Deferred tax liabilities
Temporary differences
Depreciation differences on property, plant and equipment	$ 246,865	$ (4,203)	$ -	$ 242,662
Investments accounted for using the equity method	876,973	(42,103)	-	834,870
Reserve for land value increment tax	1,175,718	-	-	1,175,718
Rental revenue receivables	16,358	112	-	16,470
Exchange differences on translating the financial statements of foreign operations	-	-	5,714	5,714
Financial assets at FVTPL	39,235	7,814	-	47,049
Others	1,541	1,656	-	3,197
	$ 2,356,690	$ (36,724)	$ 5,714	$ 2,325,680

e. Deductible temporary differences and unused loss carryforwards for which no deferred tax assets have been recognized in the consolidated balance sheets

	December 31
	2025	2024
Loss carryforwards
Expiry in 2026	$ 155	$ 155
Expiry in 2027	-	-
Expiry in 2028	8,595	4,967
	$ 8,750	$ 5,122
Deductible temporary differences	$ 1,495,725	$ 1,408,965

f. Income tax assessments

The income tax returns of the Corporation Ruei Lin, Hsin Lin, Chuan Lin, Wuling, Hwo Lin, Cheng Lin, Shang Lin, Ji Lin, Yuh Lin, Jeng Lin, Jeen-Lin, Tingling, Shihlin Electric Green Power and Yeangder Entertainment through 2023 have been assessed by the tax authority.

EARNINGS PER SHARE

Unit: NT$ Per Share

	For the Year Ended December 31
	2025	2024
Basic earnings per share	$ 6.27	$ 5.81
Diluted earnings per share	$ 6.26	$ 5.80

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

Net Profit for the Year

	For the Year Ended December 31
	2025	2024
Earnings used in the computation of basic and diluted earnings per share	$ 3,267,810	$ 3,025,741

Weighted Average Number of Ordinary Shares Outstanding

	(In Thousands of Shares)
	For the Year Ended December 31
	2025	2024
Weighted average number of ordinary shares outstanding in computation of basic earnings per share	520,972	520,972
Effect of potentially dilutive ordinary shares Employees’ compensation	1,378	1,024
Weighted average number of ordinary shares outstanding in computation of diluted earnings per share	522,350	521,996

The Corporation may settle compensation paid to employees in cash or shares; therefore, the Group shall assume that the entire amount of the compensation will be settled in shares, and the resulting potentially dilutive shares will be included in the weighted average number of shares outstanding used in the computation of diluted earnings per share. Such dilutive effect of the potential shares shall be included in the computation of diluted earnings per share until the number of shares to be distributed to employees is resolved in the following year.

EQUITY TRANSACTIONS WITH NON-CONTROLLING INTERESTS

On March 12, 2025, the Group did not subscribe additional new shares of Cheng Lin at existing ownership percentage and increased the ownership percentage from 99.6% to 99.7%.

52 -

On March 18, 2024, the Group did not subscribe additional new shares of Cheng Lin at existing ownership percentage and increased the ownership percentage from 99.5% to 99.6%.

The above transactions were accounted for as equity transactions since the Group did not cease to have control over the subsidiaries.

For the year ended December 31, 2025

Cheng Lin

The proportionate share of the carrying amount of the net assets of the subsidiary transferred to (from) non-controlling interests
$ 723
Reattribution of other equity to (from) non-controlling interests
Unrealized gain (loss) on financial assets at FVTOCI
(346)
Differences recognized from equity transactions
$ 377

Line items adjusted for equity transactions
Capital surplus - changes in percentage of ownership interest in subsidiaries
$ 377

For the year ended December 31, 2024
Cheng Lin

The proportionate share of the carrying amount of the net assets of the subsidiary transferred to (from) non-controlling interests
$ 340
Reattribution of other equity to (from) non-controlling interests
Unrealized gain (loss) on financial assets at FVTOCI
(186)
Differences recognized from equity transactions
$ 154

Line items adjusted for equity transactions
Capital surplus - changes in percentage of ownership interest in subsidiaries
$ 154

CAPITAL MANAGEMENT

In order to maintain the Group’s competitiveness in the market and to continually generate profits and grow as well as to reward shareholders, it makes decision based on industry features and current operations and future development plans, and after considering factors such as changes in the external environment, plan for future working capital requirements, research and development expenses, dividend payments and other needs.

Management regularly reviews the capital structure and considers various structures that may involve different considerations of cost and risk. According to scale in the industry, industry growth and future product roadmaps, the Group plans for an appropriate market share. In addition, the Group plans the required funding that corresponds to capital expenditure needs, as well as calculates the working capital based on the characteristics of the industry and provides an overall plan for the Group’s long term development. Lastly, the Group estimates the needed contribution margin and ratio, ratio of profit from operations and cash flows to support the competitiveness of its products; as well as it considers the industry business cycle fluctuations and risk factors such as product life cycle to determine an appropriate capital structure for the Group.

53 -

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28. FINANCIAL INSTRUMENTS

a. Fair value of financial instruments not measured at fair value

The Group’s management believes that the carrying amounts of financial assets not measured at fair value approximate their fair values.

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

1) Fair value hierarchy

December 31, 2025

	Level 1	Level 2	Level 3	Total
Financial assets at FVTPL
Unlisted shares	$ -	$ -	$ 10,722	$ 10,722
Limited partnership	-	-	45,736	45,736
Mutual funds	770,457	-	-	770,457
	$ 770,457	$ -	$ 56,458	$ 826,915
Financial assets at FVTOCI
Investments in equity instruments at FVTOCI
Listed shares	$ 985,991	$ -	$ -	$ 985,991
Unlisted shares	-	-	1,471,469	1,471,469
	$ 985,991	$ -	$ 1,471,469	$ 2,457,460
December 31, 2024
	Level 1	Level 2	Level 3	Total
Financial assets at FVTPL
Unlisted shares	$ -	$ -	$ 14,166	$ 14,166
Limited partnership	-	-	14,784	14,784
Mutual funds	882,630	-	-	882,630
	$ 882,630	$ -	$ 28,950	$ 911,580
Financial assets at FVTOCI
Investments in equity instruments at FVTOCI
Listed shares	$ 1,584,859	$ -	$ -	$ 1,584,859
Unlisted shares	-	-	1,465,644	1,465,644
	$ 1,584,859	$ -	$ 1,465,644	$ 3,050,503

There were no transfers between Levels 1 and 2 in the current and prior years.

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

For the year ended December 31, 2025

Equity Instruments	Financial Assets at FVTPL	Financial Assets at FVTOCI	Total
	Equity Instruments	Equity Instruments
Balance on January 1, 2025	$ 28,950	$ 1,465,644	$ 1,494,594
Recognized in profit or loss (included in other gains and losses)	(12,672)	-	(12,672)
Recognized in other comprehensive income (included in unrealized gain (loss) on financial assets at FVTOCI)	-	(152,050)	(152,050)
Purchases	40,180	195,000	235,180
Sales	-	(37,125)	(37,125)
Balance on December 31, 2025	$ 56,458	$ 1,471,469	$ 1,527,927
Recognized in other gains and losses - unrealized	$ (12,672)		$ (12,672)
For the year ended December 31, 2024
Equity Instruments	Financial Assets at FVTPL	Financial Assets at FVTOCI	Total
	Equity Instruments	Equity Instruments
Balance on January 1, 2024	$ 11,081	$ 1,711,585	$ 1,722,666
Recognized in profit or loss (included in other gains and losses)	(438)	-	(438)
Recognized in other comprehensive income (included in unrealized gain (loss) on financial assets at FVTOCI)	-	264,295	264,295
Purchases	20,400	-	20,400
Sales	(2,093)	(99,706)	(101,799)
Transfers out of Level 3	-	(410,530)	(410,530)
Balance on December 31, 2024	$ 28,950	$ 1,465,644	$ 1,494,594
Recognized in other gains and losses - unrealized	$ (438)		$ (438)

55 -

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

The fair values of limited partnership and unlisted equity securities were determined using the income approach, and asset approach.

The income approach based on discounted cash flow method was used to capture the present value of the expected future economic benefits to be derived from the ownership of these investees; the asset approach evaluates the fair value by assessing the total value of individual assets and individual liabilities of the investment target.

c. Categories of financial instruments

	December 31
	2025	2024
Financial assets
Financial assets at FVTPL
Mandatorily classified as at FVTPL	$ 826,915	$ 911,580
Financial assets at amortized cost (1)	12,551,524	11,288,693
Financial assets at FVTOCI
Equity instrument	2,457,460	3,050,503
Financial liabilities
Financial liabilities at amortized cost (2)	6,816,219	7,758,447

1) The balances include financial assets at amortized cost, which comprise cash and cash equivalents, notes receivable, trade receivables, other receivables and other financial assets.

2) The balances include financial liabilities at amortized cost, which comprise short-term borrowings, notes payable, trade payables and other financial liabilities.

d. Financial risk management objectives and policies

The Group's major financial instruments included cash and cash equivalents, equity investments, mutual funds, notes receivable, trade receivables, trade payables and borrowings. The Group's Finance division provides services to the business, coordinates access to financial markets, monitors and manages the financial risks relating to the operations of the Group through the analysis of exposures by degree and magnitude of risks. These risks include market risk (including foreign currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

The Group sought to minimize the effects of these risks by using derivative financial instruments to hedge risk exposures. The use of financial derivatives was governed by the Group's policies approved by the board of directors.

56 -

57 -

1) Market risk

The Group’s activities exposed it primarily to the financial risks of changes in foreign currency exchange rates (see (a) below), interest rates (see (b) below) and other price risk (see (c) below).

a) Foreign currency risk

The Group had foreign currency-denominated sales and purchases, which exposed the Group to foreign currency risk. Exchange rate exposures were managed within approved policy parameters utilizing foreign exchange forward contracts.

The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities (including those eliminated on consolidation) and of the derivatives exposed to foreign currency risk at the end of the reporting period are set out in Note 32.

Sensitivity analysis

The Group was mainly exposed to the USD, RMB and JPY.

The following table details the Group’s sensitivity to a 1% increase and a 1% decrease in the functional currency against the relevant foreign currencies. The sensitivity rate of 1% is used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis included only outstanding foreign currency-denominated monetary items, and adjusts their translation at the end of the reporting period for a 1% change in foreign currency rates. A positive number indicates an increase (decrease) in pre-tax profit when the functional currency strengthened by 1% against the relevant foreign currency. Conversely, a negative number below indicates a decrease in pre-tax profit when the functional currency weakened by 1% against the relevant foreign currency.

	USD Impact		RMB Impact		JPY Impact
	For the Year Ended December 31		For the Year Ended December 31		For the Year Ended December 31
	2025	2024	2025	2024	2025	2024
Profit or loss	$(14,403) (i)	$(15,012) (i)	$(1,348)(ii)	$(1,353) (ii)	$(1,282) (iii)	$(1,471) (iii)

i. This was mainly attributable to the exposure on outstanding USD bank deposits, receivables, borrowings and payables which were not hedged at the end of the reporting period.

ii. This was mainly attributable to the exposure on outstanding RMB bank deposits, receivables and payables which were not hedged at the end of the reporting period.

iii. This was mainly attributable to the exposure on outstanding JPY bank deposits, receivables and payables which were not hedged at the end of the reporting period.

The Group’s sensitivity to foreign currency has not changed significantly from the prior year.

b) Interest rate risk

The Group was exposed to interest rate risk because entities in the Group borrowed funds at both fixed and floating interest rates. The Group pays attention to changes in market interest rates in order to make plans to manage interest rate risk.

The carrying amounts of the Group’s financial assets and financial liabilities with exposure to interest rates at the end of the reporting period were as follows:

	December 31
	2025	2024
Fair value interest rate risk
Financial assets	$ 339,026	$ 633,656
Financial liabilities	1,225,816	825,152
Cash flow interest rate risk
Financial liabilities	103,100	107,100

Sensitivity analysis

The sensitivity analyses below were determined based on the Group’s exposure to interest rates for non-derivative instruments at the end of the reporting period. For floating-rate liabilities, the analysis was prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A sensitivity rate of 1% increase or decrease was used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates.

If interest rates had been 1% higher/lower and all other variables were held constant, the Group’s pre-tax profit for the years ended December 31, 2025 and 2024 would have decreased/increased by $1,031 thousand and $1,071 thousand, respectively.

The Group’s sensitivity to interest rates has not changed significantly from the prior year.

c) Other price risk

The Group was exposed to price risk through its investments in listed equity securities and mutual funds. The Group has appointed a special team to monitor the price risk and make plans to manage the price risk.

Sensitivity analysis

The sensitivity analyses below were determined based on the exposure to the price risks of the aforementioned investments at the end of the reporting period.

If equity prices had been 1% higher/lower, pre-tax profit for the years ended December 31, 2025 and 2024 would have increased/decreased by $8,269 thousand and $9,116 thousand, respectively, as a result of the changes in fair value of financial assets at FVTPL, and the pre-tax other comprehensive income for the years ended December 31, 2025 and 2024 would have increased/decreased by $24,575 thousand and $30,505 thousand, respectively, as a result of the changes in fair value of financial assets at FVTOCI.

The Group’s sensitivity to price risk has not changed significantly from the prior year.

58 -

2) Credit risk

Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in financial loss to the Group. As at the end of the reporting period, the Group’s maximum exposure to credit risk which will cause a financial loss to the Group due to failure of counterparties to discharge an obligation and financial guarantees provided by the Group could arise from:

a) The carrying amount of the respective recognized financial assets as stated in the consolidated balance sheets; and
b) The amount of contingent liabilities in relation to financial guarantees issued by the Group.

The credit risk on liquid funds and derivatives was limited because the counterparties are reputable banks.

The table below analyzes the collaterals held as security and other credit enhancements, and their financial effect in respect of the financial assets recognized in the Group’s consolidated balance sheets:

December 31, 2025

	Carrying Amount	Maximum Exposure to Credit Risk Mitigated by
		Collateral	Other Credit Enhancements	Total
Credit-impaired financial instruments according to impairment criteria in IFRS 9
Receivables and contract assets	$ 8,986,984	$ 340,038	$ 403,231	$ 743,269

December 31, 2024

	Carrying Amount	Maximum Exposure to Credit Risk Mitigated by
		Collateral	Other Credit Enhancements	Total
Credit-impaired financial instruments according to impairment criteria in IFRS 9
Receivables and contract assets	$ 9,106,933	$ 287,963	$ 226,164	$ 514,127

3) Liquidity risk

The Group manages liquidity risk by monitoring and maintaining a level of cash and cash equivalents deemed adequate to finance the Group’s operations and mitigate the effects of fluctuations in cash flows. In addition, management monitors the utilization of bank borrowings and ensures compliance with loan covenants.

The Group relies on bank borrowings as a significant source of liquidity. As of December 31, 2025 and 2024, the Group had available unutilized short-term bank loan facilities of $10,618,029 thousand and $11,147,945 thousand, respectively.

Liquidity and interest risk rate table for non-derivative financial liabilities

The following table details the Group’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables had been drawn up based on the undiscounted cash flows of financial liabilities from the earliest date on which the Group can be required to pay. The tables included both interest and principal cash flows. Specifically, bank loans with a repayment on demand clause were included in the earliest time band regardless of the probability of the banks choosing to exercise their rights. The maturity dates for other non-derivative financial liabilities were based on the agreed repayment dates.

December 31, 2025

	On Demand or Less than 1 Month	1-3 Months	3 Months to 1 Year	1-5 Years	5+ Years
Non-derivative financial liabilities
Non-interest bearing	$ 1,486,491	$ 2,843,142	$ 1,047,536	$ 25,410	$ 157,856
Lease liabilities	1,997	3,626	15,137	13,555	-
Variable interest rate liabilities	31,000	67,100	-	-	-
Fixed interest rate liabilities	505,000	550,621	177,090	-	-
Refund liability	11,248	22,496	33,741	-	-
	$ 2,035,736	$ 3,486,985	$ 1,273,504	$ 38,965	$ 157,856

December 31, 2024

	On Demand or Less than 1 Month	1-3 Months	3 Months to 1 Year	1-5 Years	5+ Years
Non-derivative financial liabilities
Non-interest bearing	$ 1,896,162	$ 3,365,349	$ 1,400,163	$ 81,055	$ 156,526
Lease liabilities	971	1,792	6,517	9,402	-
Variable interest rate liabilities	42,143	65,386	638	-	-
Fixed interest rate liabilities	179,815	551,130	96,004	-	-
Refund liability	9,129	18,258	27,387	-	-
	$ 2,128,220	$ 4,001,915	$ 1,530,709	$ 90,457	$ 156,526

The amounts included above for variable interest rate instruments for non-derivative financial liabilities were subject to change if changes in variable interest rates differ from those estimates of interest rates determined at the end of the reporting period.

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29. TRANSACTIONS WITH RELATED PARTIES

Balances and transactions between the Group and its subsidiaries, which are related parties of the Group, have been eliminated on consolidation and are not disclosed in this note. Besides information disclosed elsewhere in the other notes, details of transactions between the Group and other related parties are disclosed below.

a. Related parties and relationships:

Name of Related Party	Relationship with the Group
Mitsubishi Electric Group of Japan (Mitsubishi Electric)	Investor that has significant influence over the Group
Mitsubishi Electric Shihlin Automotive Changzhou Co., Ltd. (Changzhou Mitsubishi Shihlin)	Associate
Mitsuba Shihlin Electric (Wuhan) Co., Ltd. (Wuhan Mitsuba Shihlin)	Associate
Mitsubishi Electric Low Voltage Equipment (Xiamen) Co., Ltd. (Xiamen Mitsubishi)	Associate
Ambassador Hotel	Associate
Rui Young Optronics Corp. (“Rui Young Optronics”)	Associate
Mitsubishi Electric Taiwan Co., Ltd. (Mitsubishi Taiwan)	Subsidiary of investor that has significant influence over the Group
Mitsubishi Electric Automation (China) Co., Ltd. (Mitsubishi Automation)	Subsidiary of investor that has significant influence over the Group
Mitsubishi Electric Automation Corporation of Taiwan (Mitsubishi Electric Automation Taiwan)	Subsidiary of investor that has significant influence over the Group
HCT Logistics Co., Ltd. (HCT Logistics)	Related party in substance

b. Operating revenue

Line Item	Related Party Category/Name	For the Year Ended December 31
		2025	2024
Sales	Subsidiaries of investors that have significant influence over the Group	$ 313,011	$ 125,626
	Associates	94,714	435,545
	Related parties in substance	13,421	199
	Investors that have significant influence over the Group	2,452	15,728
		$ 423,598	$ 577,098
Rental revenue	Related parties in substance	$ 34,884	$ 32,049
	Subsidiaries of investors that have significant influence over the Group	25,122	25,287
		$ 60,006	$ 57,336
Other operating revenue	Related parties in substance HCT Logistics	$ 12,000	$ 12,500

c. Purchases of goods

	For the Year Ended December 31
Related Party Category/Name	2025	2024
Associates	$ 130,222	$ 17,376
Investors that have significant influence over the Group	68,447	57,181
Subsidiaries of investors that have significant influence over the Group	1,508,733	1,256,356
	$ 1,707,402	$ 1,330,913

d. Contract liabilities

Related Party Category/Name	December 31
	2025	2024
Subsidiaries of investors that have significant influence over the Group	$ 881	$ 898

e. Receivables from related parties

Line Item	Related Party Category/Name	December 31
		2025	2024
Trade receivables from related parties	Subsidiaries of investors that have significant influence over the Group
	Mitsubishi Automotive China	$ 184,945	$ 24,390
	Others	898	3,165
	Related parties in substance	333	193
	Associates
	Changzhou Mitsubishi Shihlin	-	94,141
	Others	227	4,223
	Investors that have significant influence over the Group	-	2,945
		$ 186,403	$ 129,057
Other receivables from related parties	Associates
	Wuhan Mitsuba Shihlin	$ 39,947	$ 56,684
	Others	-	358
	Subsidiaries of investors that have significant influence over the Group	398	-
	Related parties in substance	286	1,074
		$ 40,631	$ 58,116

f. Payables to related parties

Line Item	Related Party Category/Name	December 31
		2025	2024
Trade payables to related parties	Subsidiaries of investors that have significant influence over the Group
Mitsubishi Electric Automation Taiwan	$ 214,380	$ 182,135
	Associates
Changzhou Mitsubishi Shihlin	-	7,403
	Investors that have significant influence over the Group	-	2,151
		$ 214,380	$ 191,689
Other payables to related parties	Investors that have significant influence over the Group
Mitsubishi Electric	$ 34,322	$ 32,166
	Related parties in substance	659	786
	Associates
Subsidiaries of investors that have significant influence over the Group	326
242	1,313
2,355
		$ 35,549	$ 36,620

g. Prepayments (included in other current assets)

Related Party Category/Name	December 31
	2025	2024
Subsidiaries of investors that have significant influence over the Group	$ 84,834	$ 88,549
Investors that have significant influence over the Group	6,261	-
	$ 91,035	$ 88,549

h. Disposal of property, plant and equipment

Related Party Category/Name	Disposal of Price		Disposal of Interests
	2025	2024	2025	2024
Associates
Rui Young Optronics	$ -	$ 13,731	$ -	$ 3,925

i. Other transactions with related parties

Line Item	Related Party Category/Name	For the Year Ended December 31
		2025	2024
Royalty expenses	Investors that have significant influence over the Group Mitsubishi Electric	$ 32,116	$ 33,886
Freight expenses	Related parties in substance	$ 4,194	$ 4,710
Rental expenses	Related parties in substance	$ 1,316	$ 1,289
Rental revenue (included in other income)	Associates Xiamen Mitsubishi	$ 1,761	$ 2,711
Management service revenue (included in other gains and losses)	Associates Wuhan Mitsuba Shihlin	$ 5,499	$ 5,304
Miscellaneous revenue (included in other gain and loss)	Subsidiaries of investors that have significant influence over the Group Related parties in substance	$ 87	$ 11,448
		1,771	2,274
		$ 1,858	$ 13,722

The transactions with related parties were made at prices and terms comparable to those that would be obtained in similar transactions with non-related parties.

The aforementioned rentals collected or paid monthly were based on those prevailing in the market.

The outstanding receivables from related parties are unsecured. For the years ended December 31, 2025 and 2024, no impairment loss was recognized for receivables from related parties.

The outstanding payables to related parties are unsecured.

j. Remuneration of key management personnel

	For the Year Ended December 31
	2025	2024
Short-term employee benefits	$ 195,954	$ 148,059
Post-employment benefits	2,031	1,755
	$ 197,985	$ 149,814

The remuneration of directors and key executives was determined by the remuneration committee based on the performance of individuals and market trends.

65 -

30. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The following assets have been mortgaged as collateral for bank credit lines, performance guaranty, and a deposit for management and maintenance of public open space:

	December 31
	2025	2024
Demand deposits (included in other current assets)	$ 25,699	$ 25,699
Time deposits (included in other current assets and other non-current assets)	93,093	58,405
Investments accounted for using the equity methods	450,759	481,616
Land (included in property, plant and equipment and investment properties)	6,761,146	6,761,146
Buildings, net (included in property, plant and equipment)	165,524	179,000
Machinery and equipment, net (included in property, plant and equipment)	13	-
	$ 7,496,234	$ 7,505,866

31. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

In addition to those disclosed in other notes, significant commitments and contingencies of the Group as of December 31, 2024 were as follows:

a. The Group and several foreign companies have signed technical cooperation contracts respectively, and these contracts expired between January 2026 and July 2027. According to the technical cooperation contract, in addition to the down payment, the Group shall pay the technical royalties regularly according to the agreed percentage based on the net amount that the sales of technical cooperation products after deducting the prescribed fees. For the years ended December 31, 2025 and 2024, royalties were $37,981 thousand and $34,765 thousand, respectively.

b. As of December 31, 2025 and 2024, unused letters of credit for purchases of raw materials and machinery and equipment amounted to approximately $436,218 thousand and $370,425 thousand, respectively.

c. Unrecognized commitments were as follows:

	December 31
	2025	2024
Acquisition of property, plant and equipment	$ 215,299	$ 230,932

32. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The Group entities' significant financial assets and liabilities denominated in foreign currencies aggregated by the foreign currencies other than functional currencies of the entities in the Group and the related exchange rates between foreign currencies and respective functional currencies were as follows:

December 31, 2025

	Foreign Currency	Exchange Rate	Carrying Amount
Financial assets
Monetary items
USD	$ 41,322	31.43 (USD:NTD)	$ 1,298,761
USD	8,050	7.03-7.08 (USD:RMB)	255,474
USD	4,181	26,206.79 (USD:VND)	129,092
RMB	14,594	0.1418 (RMB:USD)	65,062
RMB	40,753	4.50 (RMB:NTD)	183,223
JPY	666,319	0.2008 (JPY:NTD)	133,797
Non-monetary items
Investments accounted for using the equity method
RMB	166,839	0.1418 (RMB:USD)	746,040
Others
USD	18,790	31.43 (USD:NTD)	590,559
Financial liabilities
Monetary items
USD	3,379	31.43 (USD:NTD)	106,198
USD	48,505	7.02-7.08 (USD:RMB)	40,968
USD	2,850	26,206.79 (USD:VND)	95,899
RMB	25,252	4.50 (RMB:NTD)	113,534
JPY	22,038	0.2008 (JPY:NTD)	4,425
JPY	6,027	0.0448 (JPY:RMB)	1,191
December 31, 2024
	Foreign Currency	Exchange Rate	Carrying Amount
Financial assets
Monetary items
USD	$ 37,918	32.79 (USD:NTD)	$ 1,243,132
USD	8,840	7.16-7.19 (USD:RMB)	283,603
USD	4,057	25,393.16 (USD:VND)	130,824
RMB	4,413	0.1466 (RMB:USD)	21,214
RMB	40,083	4.48 (RMB:NTD)	179,493
JPY	775,708	0.2099 (JPY:NTD)	162,821
			(Continued)

	Foreign Currency	Exchange Rate	Carrying Amount
Non-monetary items
Investments accounted for using the equity method
RMB	$ 346,111	0.1466 (RMB:USD)	$ 1,585,126
Others
USD	20,138	32.79 (USD:NTD)	660,212
Financial liabilities
Monetary items
USD	3,367	32.79 (USD:NTD)	110,374
USD	249	7.16-7.19 (USD:RMB)	7,870
USD	1,177	25,393.16 (USD:VND)	38,160
RMB	14,613	4.48 (RMB:NTD)	65,438
JPY	74,676	0.2099 (JPY:NTD)	15,674
			(Concluded)

Please refer to the consolidated statements of income for the aggregate of realized and unrealized foreign currency exchange gains and losses for the years ended December 31, 2025 and 2024. Due to various kinds of foreign currency transactions and functional currencies of the Corporation's subsidiaries, it is not possible to disclose exchange gains and losses separately for material impacts of foreign currency.

33. SEPARATELY DISCLOSED ITEMS

a. Information about significant transactions and investees:

1) Financing provided to others: Table 1.
2) Endorsements/guarantees provided: Table 2.
3) Significant marketable securities held (excluding investments in subsidiaries and associates): Table 3.
4) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the paid-in capital: Table 4.
5) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital: None.
6) Intercompany relationships and significant intercompany transactions: Table 5.

b. Information on investees (excluding investees in mainland China): Table 6.

c. Information on investments in mainland China

1) Information on any investee company in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, net income of investees, investment income or loss, carrying amount of the investment at the end of the period, repatriations of investment income, and limit on the amount of investment in the mainland China area: Table 7.

2) Any of significant transactions with investee companies in mainland China, either directly or indirectly through a company in third area, and their prices, payment terms, and unrealized gains or losses: Table 5.

34. OPERATING SEGMENT INFORMATION

a. Operating segment:

Information reported to the chief operating decision maker for the purposes of resource allocation and assessment of segment performance focuses on types of goods or services delivered or provided. The reportable segments are as follows:

Electric distribution segment - manufacture and sale of heavy electric equipment.
Automobile parts segment - manufacture and sale of automotive equipment and related parts.
Automation equipment and parts segment - manufacture and sale of industrial automation control products.
Other segment - leasing of commercial building and sale of digital products.

b. Segment revenues and results:

The information of the Group’s revenues and results by segment was as follows:

	Electric Distribution Segment	Automobile Parts Segment	Automation Equipment and Parts Segment	Other Segment	Adjustments and Eliminations	Consolidated
For the year ended December 31, 2025
Revenue from external customers	$ 26,837,189	$ 5,443,903	$ 3,876,947	$ 1,019,906	$ -	$ 37,177,945
Inter-segment revenue	1,742	1,644	2,511	109	(6,006)	-
Total revenue	$ 26,838,931	$ 5,445,547	$ 3,879,458	$ 1,020,015	$ (6,006)	$ 37,177,945
Segment income	$ 1,753,768	$ 493,473	$ 352,861	$ 431,104	$ -	$ 3,031,206
Unallocated amount						1,238,527
Profit before income tax						$ 4,269,733
For the year ended December 31, 2024
Revenue from external customers	$ 24,547,010	$ 5,948,348	$ 3,474,270	$ 1,101,533	$ -	$ 35,071,161
Inter-segment revenue	1,105	1,738	2,927	-	(5,770)	-
Total revenue	$ 24,548,115	$ 5,950,086	$ 3,477,197	$ 1,101,533	$ (5,770)	$ 35,071,161
Segment income	$ 1,784,757	$ 481,840	$ 359,995	$ 430,432	$ -	$ 3,057,024
Unallocated amount						946,366
Profit before income tax						$ 4,003,390

c. Geographical information

The Group operates in three principal geographical areas - Taiwan, China, and Vietnam.

The Group’s revenue from external customers by location of customers and information about its non-current assets by location of assets are detailed below.

| | Revenue from
External Customers | | Non-current Assets | |
| --- | --- | --- | --- | --- |
| | For the Year Ended December 31 | | December 31 | |
| | 2025 | 2024 | 2025 | 2024 |
| Taiwan | $ 27,942,812 | $ 25,868,279 | $ 12,964,554 | $ 12,812,539 |
| Mainland China | 4,902,422 | 5,219,249 | 1,269,678 | 1,319,499 |
| Vietnam | 1,076,967 | 1,250,058 | 409,415 | 443,439 |
| Others | 3,255,744 | 2,733,575 | 59,582 | 35,945 |
| | $ 37,177,945 | $ 35,071,161 | $ 14,703,229 | $ 14,611,422 |

Non-current assets exclude financial instruments and deferred tax assets.

d. Information about major customers

No single customer contributed 10% or more to the Group’s revenue in both 2025 and 2024.

69 -

TABLE 1

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

FINANCING PROVIDED TO OTHERS

FOR THE YEAR ENDED DECEMBER 31, 2025

(In Thousands of New Taiwan Dollars)

No. (Note 1)	Lender	Borrower	Financial Statement Account	Related Party	Highest Balance for the Period	Ending Balance	Actual Amount Borrowed	Interest Rate (%)	Nature of Financing (Note 2)	Business Transaction Amount	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral		Financing Limit for Each Borrower (Note 3)	Aggregate Financing Limit (Note 3)	Note
													Item	Value
1	Wuxi Shihlin Electric & Engineering Co., Ltd.	Changzhou Shihlin Auto Parts Co., Ltd.	Other receivables from related parties	Yes	$ 92,516	$ 89,432	$ 89,432	2.7-3.2	2	$ -	Operational turnaround	$ -	-	$ -	$ 136,179	$ 136,179	Note 4

Note 1: The Corporation is indicated by No. 0, investees are numbered in order from No. 1.
Note 2: Nature of financing as follows:

a. Business relationship is indicated by No. 1.
b. Short-term financing is indicated by No. 2.

Note 3: The following information was in accordance with the recent financial statements as of December 31, 2025 received from the following companies. Wuxi Shihlin Electric & Engineering Co., Ltd. had a net value limit of 40% that amounted to $136,179 thousand in equity (net value of $340,449 thousand as of December 31, 2025 = 40%).
Note 4: The amount was eliminated upon consolidation.

TABLE 2

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

ENDORSEMENTS/GUARANTEES PROVIDED

FOR THE YEAR ENDED DECEMBER 31, 2025

(In Thousands of New Taiwan Dollars)

No. (Note 1)	Endorser/Guarantor	Endorsee/Guarantee		Limits on Endorsement/ Guarantee Given on Behalf of Each Party	Maximum Amount Endorsed/ Guaranteed During the Period	Outstanding Endorsement/ Guarantee at the End of the Period	Actual Borrowing Amount	Amount Endorsed/ Guaranteed by Collaterals	Ratio of Accumulated Endorsement/ Guarantee to Net Equity in Latest Financial Statements (%)	Aggregate Endorsement/ Guarantee Limit	Endorsement/ Guarantee Given by Parent on Behalf of Subsidiaries (Note 5)	Endorsement/ Guarantee Given by Subsidiaries on Behalf of Parent (Note 5)	Endorsement/ Guarantee Given on Behalf of Companies in Mainland China (Note 5)
		Name	Relationship (Note 2)
0	Shihlin Electric & Engineering Corp.	Shihlin Electric Engineering Equipment Vietnam Company Limited	a and b	$ 7,258,517 (Note 3)	$ 132,820	$ 125,720	$ -	$ -	0.16	$ 18,146,294 (Note 4)	Y	-	-
		Changzhou Shihlin Auto Parts Co., Ltd.	b	7,258,517 (Note 3)	365,257	345,730	136,384	-	0.45	18,146,294 (Note 4)	Y	-	Y
		Wuxi Shihlin Electric & Engineering Co., Ltd.	a and b	7,258,517 (Note 3)	166,026	157,150	-	-	0.21	18,146,294 (Note 4)	Y	-	Y
		Suzhou Shihlin Electric & Engineering Co., Ltd.	a and b	7,258,517 (Note 3)	99,615	94,290	-	-	0.12	18,146,294 (Note 4)	Y	-	Y
		Shihlin Electric (Suzhou) Power Equipment Co., Ltd.	a and b	7,258,517 (Note 3)	99,615	94,290	64,042	-	0.12	18,146,294 (Note 4)	Y	-	Y
		Shihlin Technology (Shenzhen) Co., Ltd.	a and b	7,258,517 (Note 3)	23,129	22,358	-	-	0.03	18,146,294 (Note 4)	Y	-	Y
		Shihlin Electrical Engineering Ltd. of Vietnam	a and b	7,258,517 (Note 3)	166,026	157,150	-	-	0.21	18,146,294 (Note 4)	Y	-	-

Note 1: Endorser/Guarantor is numbered as follows:
a. Parent: 0.
b. Investee sequentially numbered by Arabic numerals from 1.

Note 2: Relationships between the endorser/guarantee and the party being endorsed/guaranteed are as follows:
a. A company that the Corporation has business relationship with.
b. The Corporation owns directly or indirectly over 50% ownership of the investee company.
c. The company that owns directly or indirectly hold over 50% ownership of the Corporation.
d. In between companies that were held over 90% of voting shares directly or indirectly by an entity.
e. The Corporation is required to provide guarantees or endorsements for the construction project based on the construction contract.
f. Shareholder of the investee provides endorsements/guarantees to the company in proportion to their shareholding percentages.
g. According to Consumer Protection Act, companies in the same industry enter into collateral performance guarantees for pre-construction home sales agreements.

Note 3: For subsidiaries that the Corporation holds more than 50% of the shares, 20% of the net value of the Corporation's latest financial statements is the limit for endorsement of a single enterprise, which is calculated to be $7,258,517 thousand (net value of $36,292,589 thousand as of December 31, 2025 = 20%).

Note 4: The maximum limit is 50% of the net value of the Corporation's latest financial statements, which is calculated to be $18,146,294 thousand (net value of $36,292,589 thousand as of December 31, 2025 = 50%).

Note 5: Parent company as subsidiary's guarantor, subsidiary as parent company's guarantor and guarantee companies from China are marked Y.

TABLE 3

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

SIGNIFICANT MARKETABLE SECURITIES HELD (EXCLUDING INVESTMENTS IN SUBSIDIARIES AND ASSOCIATES)

DECEMBER 31, 2025

(In Thousands of New Taiwan Dollars)

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account	December 31, 2025
				Shares	Carrying Amount	Percentage of Ownership	Fair Value
Shihlin Electric & Engineering Corp.	Shares
	Arch Meter Corporation	The Corporation is a director	Financial assets at FVTOCI	5,636,050	$ 342,673	13.1	$ 342,673
	Jine De Sheng Co., Ltd.	The Corporation is a supervisor	Financial assets at FVTOCI	6,616,016	215,153	7.7	215,153
	HCT Logistics Co., Ltd.	Same chairman	Financial assets at FVTOCI	3,157,721	357,580	1.3	357,580
	HD Renewable Energy Co., Ltd.	-	Financial assets at FVTOCI	5,618,266	554,523	4.0	554,523
	Guangxin Venture Capital Co., Ltd.	The Corporation is a director	Financial assets at FVTOCI	22,500,000	215,325	15.0	215,325

72 -

TABLE 4

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL

FOR THE YEAR ENDED DECEMBER 31, 2025

(In Thousands of New Taiwan Dollars)

Company Name	Related Party	Relationship	Transaction Details				Abnormal Transaction		Notes Accounts Receivable (Payable)		Note
			Purchases/ Sales	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
Shihlin Electric & Engineering Corp.	Hsin Lin Electric Machinery Co., Ltd.	Subsidiary	Purchase	$ 2,268,973	7.9	Payment in 60 days after acceptance	$ -	-	$ -	-	Note
	Mitsubishi Electric Automation Corporation of Taiwan	Subsidiary of investor that has significant influence over the Group	Purchase	1,386,953	4.8	Payment in 55 days after acceptance	-	-	(214,380)	(4.5)
	Xiamen Shihlin Electric & Engineering Corp.	Sub-subsidiary	Purchase	180,533	0.6	Payment in 75 days after acceptance	-	-	(12,397)	(0.3)	Note
	Chuan Lin Scien-Technical Corp.	Subsidiary	Purchase	458,109	1.6	Payment in 90 days after acceptance	-	-	(79,776)	(1.7)	Note
	Ruei Lin Electric & Engineering Corp.	Subsidiary	Purchase	190,819	0.7	Payment in 30 days after acceptance	-	-	(40,679)	(0.8)	Note
	Suzhou Shihlin Electric & Engineering Co., Ltd.	Sub-subsidiary	Purchase	168,897	0.6	Payment in 105 days after acceptance	-	-	(9,387)	(0.2)	Note
	Shihlin Electric Engineering Equipment Vietnam Company Limited	Sub-subsidiary	Purchase	532,903	1.8	Payment in 90 days after acceptance	-	-	(79,458)	(1.7)	Note
	Xiamen Shihlin Electric & Engineering Corp.	Sub-subsidiary	Sale	(131,341)	(0.5)	Collect receivables in 90 days after acceptance	-	-	35,512	0.4	Note
	Mitsubishi Electric Taiwan Co., Ltd.	Subsidiary of the Company's directors	Purchase	121,780	0.4	Payment in 120 days after acceptance	-	-	-	-
	Wuxi Shihlin Electric & Engineering Co., Ltd.	Sub-subsidiary	Purchase	108,128	0.4	Payment in 90 days after acceptance	-	-	(20,119)	(0.4)	Note
Changzhou Shihlin Mitsuba Electric & Engineering Co., Ltd.	Sub-subsidiary	Sale	(105,102)	(0.5)	Collect receivables in 90 days after acceptance	-	-	27,576	0.3	Note
Changzhou Shihlin Auto Parts Co., Ltd.	Mitsubishi Electric Automotive (China) Ltd.	Subsidiary of the Company's directors	Sale	(287,734)	(44.3)	Collect receivables in 60 days after acceptance	-	-	184,946	64.7	-
Hsin Lin Electric Machinery Co., Ltd.	Shihlin Electric & Engineering Co.	Parent company	Sale	(2,268,973)	(100.0)	Collect receivables in 60 days after acceptance	-	-	-	-	Note
Xiamen Shihlin Electric & Engineering Corp.	Shihlin Electric & Engineering Co	Ultimate parent company	Sale	(180,533)	(10.4)	Collect receivables in 75 days after acceptance	-	-	12,397	20.1	Note
Chuan Lin Scien-Technical Corp.	Shihlin Electric & Engineering Co.	Parent company	Sale	(458,109)	(100.0)	Collect receivables in 90 days after acceptance	-	-	79,776	100.0	Note
Ruei Lin Electric & Engineering Corp.	Shihlin Electric & Engineering Co.	Parent company	Sale	(190,819)	(68.4)	Collect receivables in 30 days after acceptance	-	-	40,679	93.0	Note
Suzhou Shihlin Electric & Engineering Co., Ltd.	Shihlin Electric & Engineering Co.	Ultimate parent company	Sale	(168,897)	(26.8)	Collect receivables in 105 days after acceptance	-	-	9,387	3.3	Note
Xiamen Shihlin Electric & Engineering Corp.	Shihlin Electric & Engineering Co.	Ultimate parent company	Purchase	131,341	11.1	Payment in 90 days after acceptance	-	-	(35,512)	(59.2)	Note
Shihlin Electric Engineering Equipment Vietnam Company Limited	Shihlin Electric & Engineering Co.	Parent company	Sale	(532,903)	(55.0)	Collect receivables in 90 days after acceptance	-	-	79,458	50.2	Note
Changzhou Shihlin Auto Parts Co., Ltd.	Shihlin Electric & Engineering Co.	Parent company	Purchase	105,102	13.6	Payment in 90 days after acceptance	-	-	(27,576)	(13.6)	Note
Wuxi Shihlin Electric & Engineering Co., Ltd	Shihlin Electric & Engineering Co.	Parent company	Sale	(108,128)	(10.4)	Collect receivables in 90 days after acceptance	-	-	20,119	20.4	Note

Note: The transactions of subsidiaries have been eliminated in the consolidated financial statements.

TABLE 5

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT TRANSACTIONS

FOR THE YEAR ENDED DECEMBER 31, 2025

(In Thousands of New Taiwan Dollars)

No. (Note 1)	Investee Company	Counterparty	Relationship (Note 2)	Transactions Details			% to Total Sales or Assets (Note 3)
				Financial Statement Account	Amount (Note 4)	Payment Terms
0	Shihlin Electric & Engineering Corp.	Ruei Lin Electric & Engineering Corp.	a	Purchases	$ 190,819	According to the general conditions	0.5
		Hsin Lin Electric Machinery Co., Ltd.	a	Purchases	2,268,973	According to the general conditions	6.1
		Hsin Lin Electric Machinery Co., Ltd.	a	Prepayment	996,819	According to the general conditions	2.7
		Chuan Lin Scien-Technical Corp.	a	Purchases	458,109	According to the general conditions	1.2
		Suzhou Shihlin Electric & Engineering Co., Ltd.	a	Purchases	168,897	According to the general conditions	0.5
		Shihlin Electrical Engineering Ltd. of Vietnam	a	Purchases	532,903	According to the general conditions	1.4
		Xiamen Shihlin Electric & Engineering Co., Ltd.	a	Purchases	180,533	According to the general conditions	0.5

Note 1: Business relationships between the parent and subsidiaries are numbered as follows:
a. Parent: 0.
b. Subsidiaries, sequentially numbered by Arabic numerals from 1.

Note 2: Relationships between counterparties are numbered as follows:
a. Parent to subsidiary.
b. Subsidiary to parent.
c. One subsidiary to another subsidiary.

Note 3: Percentage of consolidated operating revenues or consolidated total assets: For balance sheet account, the percentage is calculated by dividing the ending balance of the account by consolidated total assets; for an income statement account, the percentage is calculated by dividing the accumulated amount in the current period of the account by the consolidated operating revenues.

Note 4: The amount was eliminated upon consolidation.

TABLE 6

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

INFORMATION ON INVESTEES (EXCLUDING INVESTMENTS IN MAINLAND CHINA)

FOR THE YEAR ENDED DECEMBER 31, 2025

(In Thousands of New Taiwan Dollars)

Investor Company	Investor Company	Location	Main Businesses and Products	Original Investment Amount		As of December 31, 2025			Net Income (Loss) of the Investor	Share of Profits (Loss)	Note
				December 31, 2025	December 31, 2024	Shares	%	Carrying Amount
Shihlin Electric & Engineering Corp.	SEEC International Holdings Ltd. of the British Virgin Islands	British Virgin Islands	Investment and trade business	$ 1,583,877	$ 1,583,877	48,828,287	100.0	$ 4,059,289	$ 144,692	$ 129,864 (Note 1)	Subsidiary (Note 6)
	Shihlin Electrical Engineering Ltd. of Vietnam	Vietnam DongNai	Electrical goods production	57,521	57,521	(Note 5)	100.0	491,808	78,032	78,104 (Note 1)	Subsidiary (Note 6)
	Shihlin Electric USA Company Limited	California	The heavy electrical equipment product marketing promotion services	79,879	79,879	2,500,000	100.0	52,038	42,300	42,300	Subsidiary (Note 6)
	Yuh Lin Investment Co., Ltd.	Taipei	Investment	429,896	429,896	42,990,000	94.3	1,009,438	6,316	5,956	Subsidiary (Note 6)
	Hwo Lin Investment Co., Ltd.	Taipei	Investment	499,885	499,885	49,990,000	94.8	957,992	8,980	8,513	Subsidiary (Note 6)
	Ji Lin Investment, Co., Ltd.	Taipei	Investment	379,882	379,882	37,990,000	99.9	652,679	1,753	1,752	Subsidiary (Note 6)
	Jeng Lin Investment Co., Ltd.	Taipei	Investment	229,896	229,896	22,990,000	89.4	550,112	4,659	4,165	Subsidiary (Note 6)
	Cheng Lin Investments Co., Ltd.	Taipei	Investment	618,038	538,038	61,807,000	99.7	1,016,287	16,047	15,999	Subsidiary (Note 6)
	Shang Lin Investment Co., Ltd.	Taipei	Investment	598,032	598,032	59,807,000	99.6	957,533	7,886	7,855	Subsidiary (Note 6)
	Hsin Lin Electric Machinery Co., Ltd.	Taipei	A variety of power transmission and distribution, data storage and processing equipment, machinery and communications equipment, electronic components and telecommunications equipment manufacturing, electronic materials and retail business	24,000	24,000	2,880,000	60.0	342,954	85,959	51,641	Subsidiary (Note 6)
	Ruei Lin Electric & Engineering Corp.	Hsinchu County	Mechanical appliances and electrical manufacturing various components of the processing of trading business	163,487	163,487	10,274,053	90.0	571,672	105,066	95,304 (Note 2)	Subsidiary (Note 6)
	Jeen-Lin Industrial Co., Ltd.	Hsinchu County	Manufacture of various metal machinery, purchase and sale of various metal materials, manufacture, purchase, sale, import and export of the products from aforementioned activities of which the first mold is managed by the Corporation	47,978	47,978	5,346,364	78.4	136,317	8,970	7,042 (Note 3)	Subsidiary (Note 6)
	Chuan Lin Scien-Technical Corp.	Hsinchu County	Operating a variety of vending machines and the sale of the maintenance service, vending machines set of management consultancy services, mechanical refrigeration and air conditioning equipment and affairs of the sale and installation of mechanical equipment business, the sale of a variety of heavy electrical machinery and mechanical appliances of automation equipment maintenance holds business, import and export business before the products, trading and export business of the switch	4,100	4,100	410,000	31.5	53,081	22,472	7,082	Subsidiary (Note 6)
	Chan Der Investment Corp.	Taipei	Investment	51,030	51,030	2,438,783	8.1	126,874	32,457	2,629	Associate
	Cheng Der Investment Corp.	Taipei	Investment	18,950	18,950	1,149,177	3.6	27,146	8,126	293	Associate
	Yu Der Investment Corp.	Taipei	Investment	26,180	26,180	2,618,000	4.8	47,861	(36,194)	(1,737)	Associate
Tingling Enterprise Co., Ltd.	Taipei	Mechanical parking equipment manufacture of lifting equipment and toll system sale maintenance and automated warehousing equipment manufacturing business maintenance and agents at home and abroad before the manufacturers product pricing and distribution operations as well as the import and export business	123,760	123,760	12,188,000	96.7	265,579	659	657	Subsidiary (Note 6)

(Continued)

Investor Company	Investor Company	Location	Main Businesses and Products	Original Investment Amount		As of December 31, 2025			Net Income (Loss) of the Investor	Share of Profits (Loss)	Note
				December 31, 2025	December 31, 2024	Shares	%	Carrying Amount
Ruei Lin Electric & Engineering Corp.	Shihlin Electric Green Power Corp.	Taipei	Investment consulting, management consulting, other consulting services, international trade, leasing, real estate leasing, information software services, data processing services, electronic information supply services, general advertising services, power generation, transmission, and distribution machinery manufacturing, self-use renewable energy power generation equipment and energy technology service and general investment	$ 300,000	$ 300,000	30,000,000	100.0	$ 302,937	$ 1,146	$ 1,146	Subsidiary (Note 6)
	968 Digital Information Co., Ltd.	Taipei	Information software services, data processing services, electronic information supply services, information software wholesale, information software retail, wholesale of computer and business machinery equipment, retailing of computer and business machinery equipment, international trade, temporary labor services, management consulting, investment consulting, general investment and leasing	10,000	10,000	1,000,000	33.3	11,433	1,777	593	Associate
	Gochabar Co., Ltd.	New Taipei City	A variety of power transmission and distribution, installation and maintenance, electronic components manufacturing, telecommunications equipment wholesale and retail, parking area operators, information software and technical services, product designing, repair and leasing	24,000	24,000	2,400,000	20.0	13,148	(14,513)	(2,902)	Associate
	Shilin Star Power Corporation	Taipei	Manufacture of equipment for electric vehicle charging piles and optical charging and storage solutions.	40,800	40,800	4,080,000	51.0	35,028	(4,311)	(3,839)	Subsidiary (Note 6)
	New Star Charging Technology Corp.	Taipei	Sales, control and operation of equipment related to electric vehicle charging piles and optical charging and storage solutions.	9,200	9,200	920,000	46.0	9,218	224	103	Associate
	The Ambassador Hotel Co., Ltd.	Taipei	International hotels business, with a restaurant, coffee shop, bar and club business	1,912,495	1,912,495	66,918,617	18.2	5,960,104	210,041	42,373	Associate
Ruei Lin Electric & Engineering Corp.	Shihlin Electric Engineering Equipment Vietnam Company Limited	Vietnam DongNai	Manufacture of mechanical equipment, mechanical appliances and their components; transmission and distribution and sales; and installation engineering; wired and wireless telecommunications wiring project; and related products import and export trade business	83,770	83,770	(Note 5)	100.0	352,013	98,647		Sub-subsidiary (Note 6)
	Wuling Electric Co., Ltd.	New Taipei City	Manufacturing, processing and sales of mechanical and electrical parts, power distribution equipment and switch products	25,197	25,197	1,500,000	30.0	34,397	10,370		Sub-subsidiary (Note 6)
	De Hong Investment Corp.	Taipei	Investment	40,000	40,000	4,000,000	2.4	106,891	59,789		Associate
Ji Lin Investment, Co., Ltd.	Chang Hong Investment Corp.	Taipei	Investment	130,017	130,017	13,002,000	16.1	260,795	23,936		Associate
	Yu Hong Investment Corp.	Taipei	Investment	50,000	50,000	5,000,000	2.5	97,513	(10,397)		Associate
	Yu Der Investment Corp.	Taipei	Investment	60,017	60,017	6,002,000	11.1	111,078	(36,194)		Associate
	Yeangder Entertainment Co., Ltd.	Taipei	Engaged in competitive and recreational sports industry	15,000	15,000	1,500,000	37.5	12,554	603		Sub-subsidiary (Note 6)
	The Ambassador Hotel Co., Ltd.	Taipei	International hotels business, with a restaurant, coffee shop, bar and club business	52,160	52,160	1,631,000	0.4	145,265	210,041		Associate
Shang Lin Investment Co., Ltd.	Chan Der Investment Corp.	Taipei	Investment	16,680	16,680	1,668,000	5.6	87,402	32,457		Associate
	Cheng Der Investment Corp.	Taipei	Investment	20,000	20,000	2,000,000	6.4	48,486	8,126		Associate
	Yu Hong Investment Corp.	Taipei	Investment	120,000	120,000	12,000,000	6.0	233,797	(10,397)		Associate
	Chang Hong Investment Corp.	Taipei	Investment	20,000	20,000	2,000,000	2.5	40,135	23,936		Associate
	The Ambassador Hotel Co., Ltd.	Taipei	International hotels business, with a restaurant, coffee shop, bar and club business	54,799	54,799	1,506,000	0.4	134,132	210,041		Associate
	Xin He Investment Corp.	Taipei	Investment	40,000	40,000	4,000,000	3.5	64,452	22,638		Associate
	De Hong Investment Corp.	Taipei	Investment	130,000	130,000	13,000,000	7.7	347,621	59,789		Associate

(Continued)

Investor Company	Investor Company	Location	Main Businesses and Products	Original Investment Amount		As of December 31, 2025			Net Income (Loss) of the Investor	Note
				December 31, 2025	December 31, 2024	Shares	%	Carrying Amount
Jeng Lin Investment Co., Ltd.	Cheng Der Investment Corp.	Taipei	Investment	$ 77,012	$ 77,012	5,733,342	18.4	$ 139,049	$ 8,126	Associate
	Xin He Investment Corp.	Taipei	Investment	59,970	59,970	5,997,000	5.2	96,772	22,638	Associate
	The Ambassador Hotel Co., Ltd.	Taipei	International hotels business, with a restaurant, coffee shop, bar and club business	67,855	67,855	2,421,000	0.7	215,627	210,041	Associate
	De Hong Investment Corp.	Taipei	Investment	70,000	70,000	7,000,000	4.2	187,284	59,789	Associate
Hwo Lin Investment Co., Ltd.	Xin He Investment Corp.	Taipei	Investment	30,000	30,000	3,000,000	2.6	48,293	22,638	Associate
	Yu Hong Investment Corp.	Taipei	Investment	100,019	100,019	10,002,000	5.0	195,026	(10,397)	Associate
	Chan Der Investment Corp.	Taipei	Investment	49,011	49,011	4,700,956	15.7	246,229	32,457	Associate
	De Hong Investment Corp.	Taipei	Investment	86,019	86,019	8,002,000	4.8	213,783	59,789	Associate
	Chang Hong Investment Corp.	Taipei	Investment	20,000	20,000	2,000,000	2.5	40,135	23,936	Associate
	Yeangder Entertainment Co., Ltd.	Taipei	Engaged in competitive and recreational sports industry	25,000	25,000	2,500,000	62.5	20,922	603	Sub-subsidiary (Note 6)
	The Ambassador Hotel Co., Ltd.	Taipei	International hotels business, with a restaurant, coffee shop, bar and club business	85,585	85,585	2,633,000	0.7	234,509	210,041	Associate
Yuh Lin Investment Co., Ltd.	Chan Der Investment Corp.	Taipei	Investment	40,000	40,000	1,389,558	4.6	72,835	32,457	Associate
	Chang Hong Investment Corp.	Taipei	Investment	70,000	70,000	7,000,000	8.6	140,390	23,936	Associate
	Xin He Investment Corp.	Taipei	Investment	140,009	140,009	14,001,000	12.2	225,676	22,638	Associate
	De Hong Investment Corp.	Taipei	Investment	90,000	90,000	9,000,000	5.4	240,730	59,789	Associate
	Yu Der Investment Corp.	Taipei	Investment	26,000	26,000	2,600,000	4.8	48,061	(36,194)	Associate
	The Ambassador Hotel Co., Ltd.	Taipei	International hotels business, with a restaurant, coffee shop, bar and club business	83,369	83,369	2,640,000	0.7	235,132	210,041	Associate
	Yu Hong Investment Corp.	Taipei	Investment	70,000	70,000	7,000,000	3.5	136,283	(10,397)	Associate
Cheng Lin Investments Co., Ltd.	Chuan Lin Scien-Technical Corp.	Hsinchu County	Various sale and service maintenance of vending machines, vending machine business management consultant business, refrigerated air conditioning machinery and mechanical appliances of installation and other businesses, a variety of electro-mechanical equipment sale for automated machinery and equipment repair and installation services, import and export of various products, the switch before sale and import and export business	9,747	9,747	540,000	41.5	70,000	22,472	Subsidiary (Note 6)
	Ruei Lin Electric & Engineering Corp.	Hsinchu County	All kinds of electrical machinery equipment and components of manufacturing and processing transactions	1,000	1,000	100,000	0.9	5,599	105,066	Subsidiary (Note 6)
	Xin He Investment Corp.	Taipei	Investment	180,000	180,000	18,000,000	15.6	290,315	22,638	Associate
	Yu Hong Investment Corp.	Taipei	Investment	160,000	120,000	16,000,000	8.0	311,729	(10,397)	Associate
	Yu Der Investment Corp.	Taipei	Investment	20,000	20,000	2,000,000	3.7	36,993	(36,194)	Associate
	De Hong Investment Corp.	Taipei	Investment	80,000	40,000	8,000,000	4.8	213,783	59,789	Associate
	The Ambassador Hotel Co., Ltd.	Taipei	International hotels business, with a restaurant, coffee shop, bar and club business	19,337	19,337	558,000	0.2	49,698	210,041	Associate
Chuan Lin Scien-Technical Corp.	Ruei Lin Electric & Engineering Corp.	Hsinchu County	All kinds of electrical machinery equipment and components of manufacturing and processing transactions	687	687	42,626	0.4	2,320	105,066	Subsidiary (Note 6)
	De Hong Investment Corp.	Taipei	Investment	40,000	40,000	4,000,000	2.4	107,245	59,789	Associate
Tingling Enterprise Co., Ltd.	De Hong Investment Corp.	Taipei	Investment	40,000	40,000	4,000,000	2.4	107,169	59,789	Associate
	Yu Hong Investment Corp.	Taipei	Investment	80,000	80,000	8,000,000	4.0	156,138	(10,397)	Associate
	The Ambassador Hotel Co., Ltd.	Taipei	International hotels business, with a restaurant, coffee shop, bar and club business	266	266	10,000	-	891	210,041	Associate
Hsin Lin Electric Machinery Co., Ltd.	Hsinlin International Investment Corp. of Samoa	Samoa	Investment	57,693	57,693	1,130,000	100.0	52,050	5,725	Sub-subsidiary (Note 6)
	Yuh Lin Investment Co., Ltd.	Taipei	Investment	26,000	26,000	2,600,000	5.7	61,016	6,316	Subsidiary (Note 6)
	Hwo Lin Investment Co., Ltd.	Taipei	Investment	27,000	27,000	2,700,000	5.1	51,538	8,980	Subsidiary (Note 6)
	Jeng Lin Investment Co., Ltd.	Taipei	Investment	27,000	27,000	2,700,000	10.5	64,611	4,659	Subsidiary (Note 6)
	Wuling Electric Co., Ltd.	New Taipei City	Manufacturing, processing and sales of mechanical and electrical parts, power distribution equipment and switch products	25,197	25,197	1,500,000	30.0	34,397	10,370	Sub-subsidiary (Note 6)

(Continued)

Investor Company	Investor Company	Location	Main Businesses and Products	Original Investment Amount		As of December 31, 2025			Net Income (Loss) of the Investor	Note
				December 31, 2025	December 31, 2024	Shares	%	Carrying Amount
Jeen-Lin Industrial Co., Ltd.	Yu Hong Investment Corp.	Taipei	Investment	$ 40,000	$ 40,000	4,000,000	2.0	$ 77,932	$ (10,397)	Associate
Shihlin Electric Green Power Corp.	Rui Young Optronics Corp.	Taipei	Investment consulting, management consulting, other consulting services, international trade, leasing, real estate leasing, information software services, data processing services, electronic information supply services, general advertising services, power generation, transmission, and distribution machinery manufacturing, self-use renewable energy power generation equipment, energy technology service, general investment and specialized area development	84,000	84,000	8,400,000	30.0	84,114	248	Associate

Note 1: The adjusted unrealized gross profit and realized gross profit consist of downstream, upstream and sidestream transactions.

Note 2: The adjusted unrealized gross profit and realized gross profit consist of downstream transactions.

Note 3: The adjusted unrealized gross profit and realized gross profit consist of upstream transactions.

Note 4: The adjusted unrealized gross profit of sidestream transactions.

Note 5: The limited companies do not have shares.

Note 6: The amount was eliminated upon consolidation.

(Concluded)

TABLE 7

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

INFORMATION ON INVESTMENTS IN MAINLAND CHINA

FOR THE YEAR ENDED DECEMBER 31, 2025

(In Thousands of New Taiwan Dollars)

Investee Company in Mainland China	Main Businesses and Products	Paid-in Capital	Method of Investment (Note 1)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2025	Remittance of Funds		Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2025	Net Income (Loss) of the Investee	% Ownership of Direct or Indirect Investment	Investment Income (Loss) (Note 2)	Carrying Amount as of December 31, 2025	Accumulated Repatriation of Investment Income as of December 31, 2025	Note
					Outward	Inward
Changzhou Shihlin Mitsuba Electric & Engineering Co., Ltd.	Motorcycle starter motors, magneto, starter switch manufacturing and sales business	$ 192,835	b (Note 3)	$ 41,316 (Note 6)	$ -	$ -	$ 41,316 (Note 6)	$ 85,624	55.0	$ 46,322 (Note 7)	$ 343,730	$ 399,870	Note 5
Xiamen Shihlin Electric & Engineering Co., Ltd.	All kinds of switches, relays, circuit breakers and other products and components of the production, trafficking, technical advice and after sales service	391,115	b (Note 3)	325,403	-	-	325,403	64,643	100.0	65,935 (Note 7)	818,431	826,778	Note 5
Suzhou Shihlin Electric & Engineering Co., Ltd.	Capacitors, transformers, electric motors and other electronic components manufacturing and sales business	401,584	b (Note 3)	247,193	-	-	247,193	102,813	100.0	102,201 (Note 7)	903,717	472,749	Note 5
Wuxi Shihlin Electric & Engineering Co., Ltd.	Magneto and starter motor in locomotive transmission facilities, mobile and starter motors, power generators, and DC motor manufacturing and sales business	312,552	b (Note 3)	283,033	-	-	283,033	9,127	100.0	(5,700) (Note 7)	340,449	12,134	Note 5
Mitsubishi Electric Shihlin Automotive Changzhou Co., Ltd.	Motorcycle starter motors, magneto, ignition coils and other control or distribution equipment manufacturing and sales business	167,512	b (Note 3)	37,021	-	-	37,021	(139,986)	49.0	(68,593) (Note 7)	453,084	1,257,405	-
Shihlin Electric (Suzhou) Power Equipment Co., Ltd.	High and low pressure switch, switchgear, digital meters, transformers, capacitors, reactors, bridge and related products manufacturing and sales business	174,614	b (Note 3)	56,439	-	-	56,439	27,440	50.5	13,857 (Note 7)	129,580	189,672	Note 5
	High and low pressure switch, switchgear, digital meters, transformers, capacitors, reactors, bridge and related products manufacturing and sales business	174,614	b (Note 4)	22,173 (Note 10)	-	-	22,173 (Note 10)	27,440	20.0 (Note 10)	5,488 (Note 7)	51,319	69,704	Note 5
Mitsuba Shihlin Electric (Wuhan) Co., Ltd.	Automotive cooling fans, wiper systems, starter, fuel pump, electronic control systems and other automotive electrical parts and accessory collar manufacturing sales and service business	230,811	b (Note 3)	103,865	-	-	103,865	46,291	45.0	20,831 (Note 7)	238,400	597,318	-
Shihlin Technology (Shenzhen) Co., Ltd.	Electronic products, machinery, mechanical and electrical equipment, industrial electric equipment, plastic products technology development, design, technical advice, technology transfers, wholesale, commission agent, import/export and related business	32,000	b (Note 3)	32,000	-	-	32,000	800	100.0	800 (Note 7)	33,042	15,191	Note 5
Mitsubishi Electric Low Voltage Equipment (Xiamen) Co., Ltd.	Low-voltage circuit breakers, magnetic switches of low voltage electrical apparatus and its components, such as research and development, manufacturing and after-sales service and technical advisory services	194,805	b (Note 3)	58,441	-	-	58,441	(70,535)	30.0	(21,130) (Note 7)	54,556	3,939	-

(Continued)

Investor Company in Mainland China	Main Businesses and Products	Paid-in Capital	Method of Investment (Note 1)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2025	Remittance of Funds		Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2025	Net Income (Loss) of the Investor	% Ownership of Direct or Indirect Investment	Investment Income (Loss) (Note 2)	Carrying Amount as of December 31, 2025	Accumulated Repatriation of Investment Income as of December 31, 2025	Note
					Outward	Inward
Changzhou Shihlin Auto Parts Co., Ltd.	Motorcycle starter motors, magneto, starter switch manufacturing and sales business	$ 303,173	b (Note 3)	$ 183,948 (Note 9)	$ -	$ -	$ 183,948 (Note 9)	$ 5,673	100.0	$ 5,763 (Note 7)	$ 385,187	$ 252,110	Note 5
Xiamen Chen-leu Transportation Implements Co., Ltd.	Manufacturing and motorcycle metal materials, electronic parts, all kinds of punch products parts, machine tools, machine tools, etc.	72,679	b (Note 3)	- (Note 8)	-	-	- (Note 8)	4,731	100.0	4,171 (Note 7)	90,753	-	Note 5
Accumulated Outward Remittance for Investment in Mainland China as of December 31, 2025	Investment Amounts Authorized by Investment Commission, MOEA	Upper Limit on the Amount of Investment Stipulated by Investment Commission, MOEA
---	---	---
$1,368,659 (Note 11)	$1,368,659 (Note 11)	No upper limit on the amount of investment (Note 12)

Note 1: The methods of making investments in mainland China include the following:
a. Direct investment in mainland China.
b. Investment in mainland China through companies registered in third region.
c. Other methods.

Note 2: Recognized gain or loss in investment:
a. If it is in preparation and there is no investment gain (loss), it should be indicated.
b. The recognition of investment gain (loss) is divided into the following three types, it should be indicated.
1) The financial statement is audited and attested by certified public accounting firm with all cooperative relations with the Republic of China Accounting Firm.
2) The financial statement is audited and attested by certified public accountants of Taiwan.
3) Others.

Note 3: SEEC International Holdings Ltd. of the British Virgin Islands is the investor in third area.

Note 4: Hsinlin International Investment Corp. of Samoa, is the investor in third area.

Note 5: The amounts were eliminated upon consolidation.

Note 6: It has been deducted that the accumulated outward remittances for investment from Taiwan in the amount of $38,567 thousand for establishment of Changzhou Shihlin Auto Parts Co., Ltd. since spin-off in May 2013.

Note 7: Recognized gain and loss are based on Note 2. b. 2.

Note 8: The accumulated outward remittance for investment from Taiwan at the beginning and end of the year did not include $86,768 thousand of dividends received from investee company in mainland China.

Note 9: Changzhou Shihlin Mitsuba Electric has spun-off to Changzhou Shihlin Auto Parts Co., Ltd. in May 2013, which has accumulated outward remittance for investment from Taiwan in the amount of $38,567 thousand.

Note 10: The accumulated outward remittance for investment from Taiwan and the ownership of investment are the investment of Hsin Lin Electric Machinery Co., Ltd. through Hsinlin International Investment Corp. of Samoa.

Note 11: It excludes the investment of Hsin Lin Electric Machinery Co., Ltd. in mainland China.

Note 12: According to an issued operational headquarters' document from the Industrial Development Bureau, MOEA, which is still valid within the period, there is no upper limit on the Corporation's amount of investment.

(Concluded)

AI assistant

SEEC — Audit Report / Information 2025

51835_rns_2026-05-29_742252e0-9510-48b2-8aa0-2772011da047.pdf

Shihlin Electric & Engineering Corp. and Subsidiaries

DECLARATION OF CONSOLIDATION OF FINANCIAL STATEMENTS OF AFFILIATES

INDEPENDENT AUDITORS' REPORT

Opinion

Basis for Opinion

Key Audit Matters

The Occurrence of Major Customers’ Operating Revenue

Other Matter

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

Notice to Readers

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

1. GENERAL INFORMATION

2. APPROVAL OF CONSOLIDATED FINANCIAL STATEMENTS

3. APPLICATION OF NEW, AMENDED AND REVISED STANDARDS AND INTERPRETATIONS

4. SUMMARY OF MATERIAL ACCOUNTING POLICY INFORMATION

6. CASH AND CASH EQUIVALENTS

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

9. NOTES RECEIVABLE AND TRADE RECEIVABLES

10. INVENTORIES

11. SUBSIDIARIES

13. PROPERTY, PLANT AND EQUIPMENT

14. LEASE ARRANGEMENTS

15. INVESTMENT PROPERTIES

Accumulated depreciation and impairment

16. OTHER ASSETS

17. BORROWINGS

18. OTHER PAYABLES

19. PROVISIONS

20. RETIREMENT BENEFIT PLANS

21. EQUITY

24. INCOME TAXES

28. FINANCIAL INSTRUMENTS

29. TRANSACTIONS WITH RELATED PARTIES

30. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

31. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

32. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

33. SEPARATELY DISCLOSED ITEMS

34. OPERATING SEGMENT INFORMATION

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

SHIHLIN ELECTRIC & ENGINEERING CORP. AND SUBSIDIARIES

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