SHINY CHEMICAL - Interim / Quarterly Report 2021

SHINY CHEMICAL INDUSTRY CO., LTD.

AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED MARCH 31, 2021 AND 2020

AND

INDEPENDENT AUDITORS’ REVIEW REPORT

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Item	Page
1. Cover page	1
2. Contents	2
3. Independent auditors’ review report	3
4. Consolidated balance sheets	4
5. Consolidated statements of comprehensive income	5
6. Consolidated statements of changes in equity	6
7. Consolidated statements of cash flows	7
8. Notes to Consolidated financial statements
(1) General information	8
(2) The authorization of consolidated financial statements	8
(3) Application of new and amended standards and interpretations	8-12
(4) Summary of significant accounting policies	12-14
(5) Critical accounting judgments, estimates and key sources of assumption uncertainty	14
(6) Contents of significant accounts	14-38
(7) Related party transactions	38-40
(8) Pledged assets	40
(9) Significant contingent liabilities and unrecognized contract commitments	40-42
(10) Significant disaster loss	42
(11) Significant subsequent events	42
(12) Others	42-52
(13) Supplementary disclosures	52-53
A. Information on significant transactions	54-58
B. Information on investees	59
C. Information on investments in Mainland China	60-61
D. Major shareholders	62
(14) Segment information	63-64

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INDEPENDENT AUDITORS’ REVIEW REPORT

The Board of Directors and Shareholders Shiny Chemical Industry Co., Ltd.

Introduction

We have reviewed the accompanying consolidated balance sheets of Shiny Chemical Industry Co., Ltd. and subsidiaries (the “Group”) as of March 31, 2021 and 2020, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the three months ended March 31, 2021 and 2020, and notes to the consolidated financial statements (including a summary of significant accounting policies). Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Accounting Standards 34, “Interim Financial Reporting” as endorsed and issued into effect by the Financial Supervisory Commission (FSC) of the Republic of China. Our responsibility is to express a conclusion on the consolidated financial statements based on our reviews.

Scope of Review

Except as disclosed in basis for qualified conclusion, we conducted our reviews in accordance with Statement of Auditing Standards No. 65, “Review of Financial Information Performed by the Independent Auditor of the Entity” of the Republic of China. A review of consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the Republic of China and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

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Basis for Qualified Conclusion

As disclosed in Note 4(3), the financial statements of non-significant subsidiaries were consolida ted based on their unreviewed financial statements as of and for the same periods. These subsidiaries’ total assets amounted to $1,996,088 thousand and $1,716,337 thousand, representing 22.76% and 23.99% of the consolidated assets, and their total liabilities amounted to $496,676 thousand and $390,910 thousand, representing 18.83% and 19.56% of the consolidated liabilities as of March 31, 2021 and 2020, respectively; as well as their total comprehensive income amounted to $58,125 thousand and $50,352 thousand, representing 15.78% and 21.52% of the consolidated comprehensive income for the three months ended March 31, 2021 and 2020, respectively. In addition, as described in Note 6(7) to the consolidated financial statements, the financial statements of investments accounted for using equity method were not reviewed by independent auditors. The carrying values of these investments amounted to $896,017 thousand and $879,190 thousand, representing 10.22% and 12.29% of the consolidated assets as of March 31, 2021 and 2020, and share of profit (loss) of these associates accounted for using equity method amounted to $14,289 thousand and $10,051 thousand, representing 3.03% and 2.97% of the consolidated income before income tax for the three months ended March 31, 2021 and 2020, respectively. In addition, share of other comprehensive income of these associates accounted for using equity method amounted to ($465) thousand and ($3,999) thousand, representing 4.79% and 10.65% of total other consolidated comprehensive income for the three months ended March 31, 2021 and 2020. These amounts were recognized solely based on these investees’ unreviewed financial statements for the same periods. The information related to above subsidiaries and investees accounted for under the equity method disclosed in Note 13 was also not reviewed by independent auditors.

Qualified Conclusion

Based on our reviews, except for the adjustments, if any, as might have been determined to be necessary had the financial statements of certain subsidiaries described in basis for qualified conclusion paragraph and related information declared in Note 13 been reviewed by independent auditors, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as of March 31, 2021 and 2020, its consolidated financial performance and its consolidated cash flows for the three months then ended March 31, 2021 and 2020, in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” as endorsed and issued into effect by the Financial Supervisory Commission (FSC) of the Republic of China.

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The engagement partners on the reviews resulting in this independent auditors’ review report are Jen Yao Hsieh and Ling Wen Huang.

Crowe (TW) CPAs Kaohsiung, Taiwan Republic of China April 28, 2021

Notice to Readers

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

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

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SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In Thousands of New Taiwan Dollars)

Assets	Note	March 31, 2021 (Reviewed) Amount % $395,610 5 23,413 - 1,288,557 15 31,718 - 712 - 1,137,504 13 171,324 2 24,181 - 3,073,019 35 173,718 2 896,017 10 4,188,202 48 174,370 2 129,748 1 7,590 - 67,179 1 60,638 1 5,697,462 65 $8,770,481 100 $290,000 3 15,937 - 16,192 - 503,998 6 553,097 8 286,851 3 31,647 - 3,779 - 127,560 1 950 - 1,830,011 21	December 31, 2020 (Audited)	December 31, 2020 (Audited)	March 31, 2020 (Reviewed)	March 31, 2020 (Reviewed)
		Amount	Amount	%	Amount	%
CURRENT ASSETS Cash and cash equivalents Notes receivable, net Accounts receivable, net Other receivables Current tax assets Inventories Prepayments Other financial assets - current Total current assets NONCURRENT ASSETS Financial assets at fair value through other comprehensive income - noncurrent Investments accounted for using equity method Property, plant and equipment Right-of-use assets Investment properties, net Intangible assets Deferred income tax assets Refundable deposits Total noncurrent assets TOTAL ASSESTS Liabilities and Equity	6(1) 6(2) 6(3) 6(4) 6(5) 6(6) 6(7) 6(8) 6(9) 6(10) 6(11) 6(28) Note	$395,610 23,413 1,288,557 31,718 712 1,137,504 171,324 24,181	$443,889 24,875 1,240,196 26,401 714 1,013,795 37,532 18,681	5 - 17 - - 12 - -	$184,554 24,731 1,087,537 21,293 2,299 904,591 62,510 15,633	3 - 15 - - 13 1 -
		3,073,019	2,806,083	34	2,303,148	32
		173,718 896,017 4,188,202 174,370 129,748 7,590 67,179 60,638	180,345 885,456 3,927,863 177,065 131,009 5,757 63,117 60,615	2 11 47 2 2 - 1 1	148,605 879,190 3,520,158 59,221 134,795 5,377 58,831 45,038	2 12 49 1 2 - 1 1
		5,697,462	5,431,227	66	4,851,215	68
		$8,770,481	$8,237,310	100	$7,154,363	100
		$290,000 15,937 16,192 503,998 553,097 286,851 31,647 3,779 127,560 950	$290,000 10,916 27,992 459,049 572,234 192,305 17,941 4,278 127,560 950	4 - - 6 7 2 - - 2 -	$516,000 6,227 34,225 503,183 467,210 176,440 29,771 4,707 7,200 950	8 - - 7 7 2 - - - -
CURRENT LIABLITIES Short-term loans Contract liabilities - current Notes payable Accounts payable Other payables Current tax liabilities Provisions - current Lease liabilities - current Current portion of long-term borrowings Other current liabilities, Others Total current liabilities	6(12) 6(13) 6(14) 6(9) 6(15)
		1,830,011	1,703,225	21	1,745,913	24

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Liabilities and Equity	Note	March 31, 2021 (Reviewed) Amount % $584,230 7 62,741 1 119,088 1 31,834 - 8,290 - 1,028 - 807,211 9 2,637,222 30 1,800,000 21 103,724 1 1,106,686 13 105,890 1 3,133,840 35 (116,881) (1) 6,133,259 70 - - 6,133,259 70 $8,770,481 100	December 31, 2020 (Audited)	December 31, 2020 (Audited)	March 31, 2020 (Reviewed)	March 31, 2020 (Reviewed)
		Amount	Amount	%	Amount	%
NONCURRENT LIABILITIES Long-term loans Deferred income tax liabilities Lease liabilities - noncurrent Net defined benefit liabilities - noncurrent Guarantee deposits Other non-current liabilities, Others Total noncurrent liabilities Total Liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT Share capital Ordinary shares Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Other equity Total equity attributable to owners of the parent NON-CONTROLLING INTERESTS Total Equity TOTAL LIABILITIES AND EQUITY	6(15) 6(27) 6(9) 6(16) 6(17) 6(18) 6(19) 6(20)	$584,230 62,741 119,088 31,834 8,290 1,028	$546,319 60,918 119,960 32,434 8,214 1,266	6 1 1 1 - -	$92,800 60,370 54,481 34,439 8,165 1,978	1 1 1 1 - -
		807,211	769,111	9	252,233	4
		2,637,222	2,472,336	30	1,998,146	28
		1,800,000 103,724 1,106,686 105,890 3,133,840 (116,881)	1,800,000 103,724 1,106,686 105,890 2,755,845 (107,171)	22 1 13 1 34 (1)	1,500,000 103,724 1,017,794 80,919 2,597,231 (143,451)	21 1 14 1 37 (2)
		6,133,259 -	5,764,974 -	70 -	5,156,217 -	72 -
		6,133,259	5,764,974	70	5,156,217	72
		$8,770,481	$8,237,310	100	$7,154,363	100

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

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SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

Note	Three Months Ended March 31	Three Months Ended March 31	Three Months Ended March 31
	2021		2020
	Amount	%	Amount	%
6(21) 6(4).12(7) 12(7) 6(3) 6(23) 6(24) 6(25) 6(26) 6(27) 6(28) 6(29) 6(29)	$2,293,802 (1,538,981)	100 (67)	$1,978,370 (1,423,445)	100 (72)
	754,821 (91,808) (147,284) (54,461) (9,407)	33 (4) (7) (2) -	554,925 (83,935) (104,302) (44,183) 237	28 (4) (6) (2) -
	(302,960)	(13)	(232,183)	(12)
	451,861	20	322,742	16
	72 3,926 1,262 (450) 14,289	- - - - 1	34 3,308 4,384 (1,677) 10,051	- - - - 1
	19,099	1	16,100	1
	470,960 (92,965)	21 (4)	338,842 (67,344)	17 (3)
	377,995	17	271,498	14
	(6,627) (3,272) (465) 654	- - - -	(26,863) (8,374) (3,999) 1,675	(1) - - (1)
	(9,710)	-	(37,561)	(2)
	$368,285	17	$233,937	12
	$377,995 -	17 -	$271,498 -	14 -
	$377,995	17	$271,498	14
	$368,285 -	17 -	$233,937 -	12 -
	$368,285	17	$233,937	12
	$2.10		$1.51
	$2.09		$1.50

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

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SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(In Thousands of New Taiwan Dollars)

(Reviewed, Not Audited)

Equity Attributable to Owners of the Parent

Ordinary Shares	Capital Surplus		Retained Earnings		Other	Other	Total Equity
					Exchange Differences on Translating foreign Operations	Unrealized Gain (Loss) On Financial Assets at Fair Value Through Other Comprehensive Income
		Legal Reserve	Special Reserve	Unappropriated Earnings
$1,500,000 - -	$103,724 - -	$1,017,794 - -	$80,919 - -	$2,325,733 271,498 -	($123,603) - (10,698)	$17,713 - (26,863)	$4,922,280 271,498 (37,561)
-	-	-	-	271,498	(10,698)	(26,863)	233,937
$1,500,000	$103,724	$1,017,794	$80,919	$2,597,231	$ (134,301)	$ (9,150)	$5,156,217
$1,800,000 - -	$103,724 - -	$1,106,686 - -	$105,890 - -	$2,755,845 377,995 -	$ (129,761) - (3,083)	$22,590 - (6,627)	$5,764,974 377,995 (9,710)
-	-	-	-	377,995	(3,083)	(6,627)	368,285
$1,800,000	$103,724	$1,106,686	$105,890	$3,133,840	($132,844)	$15,963	$6,133,259

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

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SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments : Adjustments to reconcile profit (loss) Depreciation Amortization Expected credit gain (loss) Interest expense Interest income Share of profit of associates and joint ventures accounted for using equity method Gain on disposal and retirement of property, plant and equipment Transfer of property, plant and equipment to expenses Others Total adjustments to reconcile profit (loss) Net changes in operating assets and liabilities Decrease (increase) in notes receivable Decrease (increase) in accounts receivable Decrease (increase) in other receivables Decrease (increase) in inventories Decrease (increase) in prepayments Total changes in operating assets Net changes in operating liabilities Increase (decrease) in contract liabilities Increase (decrease) in notes payable Increase (decrease) in accounts payable Increase (decrease) in other payables Increase (decrease) in provisions Increase (decrease) in net defined benefit liabilities Total changes in operating liabilities Total net changes in operating assets and liabilities Total adjustments	Three Months Ended March 31	Three Months Ended March 31
	2021 $470,960 73,363 1,338 9,407 450 (72) (14,289) - - (238) 69,959 1,452 (57,758) (12,843) (123,709) (133,792) (326,650) 5,021 (11,800) 44,949 (51,693) 13,706 (600) (417) (327,067) (257,108)	2020
		$388,842 72,684 936 (237) 1,677 (34) (10,051) (330) 950 (238)
		65,357
		3,251 63,303 17,288 (53,459) (37,967)
		(7,584)
		824 (18,974) 98,330 (65,337) 13,373 (3,293)
		24,923
		17,339
		82,696

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Cash generated from operations Interest received Dividends received Interest paid Income tax (paid ) received Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Increase in refundable deposits Acquisition of intangible assets Increase in other financial assets Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Decrease in short-term loans Decrease in short-term bills payable Increase in long-term loans Repayments of long-term loans Increase in guarantee deposits Decrease in guarantee deposits Repayments of lease principal Net cash generated from (used) in financing activities EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD CASH AND CASH EQUIVALENTS, END OF PERIOD	Three Months Ended March 31	Three Months Ended March 31
	2020 $213,852 72 7,526 (682) 1 220,769 (298,035) - (23) (2,094) (5,500) (305,652) - - 39,801 (1,890) 76 - (1,374) 36,613 (9) (48,279) 443,889 $395,610	2019
		$421,538 34 - (1,629) (458)
		419,485
		(173,998) 363 (372) - -
		(174,007)
		(188,000) (100,000) 100,000 - - (16) (976)
		(188,992)
		137
		56,623 127,931
		$184,554

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

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SHINY CHEMICAL INDUSTRY CO., LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED MARCH 31, 2021 and 2020 (Reviewed, Not Audited)

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

1. GENERAL INFORMATION

Shiny Chemical Industrial Co., Ltd. (the “Company”) was incorporated in December 1979, traded in the emerging stock market from January 28, 2008 and listed in the Taiwan Stock Exchange on February 27, 2009. The Company engages mainly in the manufacturing, processing and import/export trading high-purity chemical solvents, including N-Butyl Acetate, N-Propyl Acetate, Propylene Glycol Monomethyl Ether Propionate and Methanol, etc. The principal operating activities of the Company and its subsidiaries (collectively as the “Group”) are described in Note 4(3)B. In addition, the Company has no ultimate parent company.

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

2. THE AUTHORIZATION OF FINANCIAL STATEMENTS

The accompanying consolidated financial statements were approved and authorized for issue by the Board of Directors on April 28, 2021.

3. APPLICATION OF NEW AND AMENDED STANDARDS AND INTERPRETATIONS

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

New standards, interpretations and amendments endorsed by FSC effective from 2021 are as follows:

Effective date New, Revised or Amended Standards and Interpretations Announced by IASB

Amendments to IFRS 4 “Extension of the Temporary June 25, 2020 (Effective Exemption from Applying IFRS 9” from issue date) Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS January 1, 2021 (Note) 16 “Interest Rate Benchmark Reform - Phase 2”

(Note) The amendments are applicable for the annual reporting period beginning on or after January 1, 2021.

The Group has evaluated the aforementioned standards and interpretations, and there’s no significant effect to the Group’s financial position and financial performance.

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(2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by the Group: None.

(3) The IFRSs issued by IASB but not yet endorsed and issued into effect by FSC Effective Date Announced New, Revised or Amended Standards and Interpretations by IASB (Note 1) Amendments to IFRS 10 and IAS 28 “Sale or Contribution To be determined by IASB of Assets between an Investor and its Associate or Joint Venture” IFRS 17 “Insurance Contracts” January 1, 2023 Amendments to IFRS 17 January 1, 2023 Amendments to IAS 1 “Classification of Liabilities as January 1, 2023 Current or Non-current” Amendments to IAS 16 “Property, Plant and EquipmentJanuary 1, 2022 (Note 2) Proceeds before Intended Use” Amendments to IAS 37 “Onerous Contract - Cost of January 1, 2022 (Note 3) Fulfilling a Contract” Amendments to IFRS 3 “Reference to the Conceptual January 1, 2022 (Note 4) Framework” Annual Improvements to IFRS Standard 2018-2020 January 1, 2022 (Note 5) Amendments to IAS 1 “Disclosure of Accounting Policies” January 1, 2023 (Note 6) Amendments to IAS 8 “Definition of Accounting January 1, 2023 (Note 7) Estimates” Amendments to “ IFRS 16 “Leases regarding April 1, 2021 (Note 8) COVID-19-related rent concessions after June 30, 2021”

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

Note2: Group should apply these amendments retrospectively. However, the amendments are applicable to property, plant and equipment that are brought to the location and condition necessary for them to be capable of operating in the manner intended by management on or after January 1, 2021.
Note 3: This amendment applies to contracts for which the entity has not yet fulfilled all its obligations on January 1, 2022.
Note 4: This amendment applies to business combinations whose acquisition date starts in the annual reporting period after January 1, 2022.
Note 5: The amendments to IFRS 9 are applicable to swap or modification of terms of financial liabilities incurred during the annual reporting period beginning on January 1, 2022. The amendment to IAS 41 is applicable to fair value measurement during the annual reporting period beginning after January 1, 2022. The amendments to IFRS 1 are retrospectively applied to the annual reporting period beginning after January 1, 2022.

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Note 6: The Group shall apply these amendments retrospectively for annual reporting periods beginning on or after January 1, 2023.

Note 7: The Group applies to changes in accounting estimates and changes in accounting policies that occur during the annual reporting period beginning on January 1, 2023.
Note 8: The Group shall apply these amendments retrospectively for annual reporting periods beginning on or after April 1, 2021.
A. Amendments for IAS 1 “Classification of Liabilities as Current or Noncurrent” The amendments clarifies that when the Group judges whether liability is classified as noncurrent, the Group should assess whether the Group has the right to defer liquidation period after the reporting period at least twelve months. If the Group has the entity’s right on the end of the reporting period, liability must be classified as non-current whatever the Group expects whether executing the right or not. If the Group must follow certain condition to obtain the right to defer settlement of liability, the Group must have completed certain condition on the end of reporting period even if lender tests the Group whether following certain condition later. The aforementioned liquidation means that transferring cash, other economic resources or the Group’s equity instruments to counterparty to let liability wipe out. If liability clause will follow counterparty’s choice to liquidate liability by the Group’s equity instruments, this option must follow the regulations of IAS 32 “Financial Instruments: Presentation” to be recognized in equity individually and doesn’t have affect on the classification of liability.
B. Amendment to IAS 16 “Property, Plant and Equipment: Proceeds before Intended Use” The amendment stipulates that the sales price of the project produced in order to make property, plant and equipment reach the necessary location and state that can meet the expected operation mode of the management is not suitable as a cost reduction of the asset. The aforementioned items should be measured in accordance with IAS 2 “Inventory”, and the sales price and cost should be recognized in profit and loss in accordance with the applicable standards.
This amendment is applicable to factories, property and equipment that reach the necessary locations and conditions for the management's expected operation mode after January 1, 2021 (the beginning of the earliest expression period). When the Group initially applies the amendments, it will recognize the cumulative effect of the amendments applied initially as an adjustment to the opening balance of the retained earnings (or other components of equity, as appropriate) at the beginning of the earliest expression period , and re-edit the information during the comparison period.
C. Amendment to IAS 37 “Onerous Contract - Cost of Fulfilling a Contract”
The amendment stipulates that when assessing whether the contract is onerous, “Cost of Fulfilling a Contract” should include the incremental cost of fulfilling a contract (for example, direct labor and raw materials) and the allocation of other costs directly related to fulfilling a contract (for example, the depreciation expenses of property, plant and

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equipment items used in fulfilling a contract are allocated).

The Group will recognize the cumulative effect on the retained earnings on the first application date when the amendment is first applied.

D. Amendment to IFRS 3“Reference to the Conceptual Framework”

The amendment is to update the index of the conceptual framework and add the requirement that the acquirer shall apply IFRIC 21“Levies”to determine whether there is an obligation to pay levies on the acquisition date.

E. Annual Improvements to IFRS Standards 2018-2020

The annual improvement in the IFRS 2018-2020 includes amendments to certain standards. Among them, the amendment of IFRS 9 “Expenses included in the “10%” test for the purpose of derecognize financial liabilities” is to assess whether there is a significant difference between the swap of financial liabilities or the modification of terms, When comparing cash flow projections of the new and old contract terms (including the net amount of fees charged for signing a new contract or modifying the contract), whether there is a 10% difference, the aforesaid fees collected should only include the payment between the borrower and the lender paid for.

F. Amendments to IAS 1 ‘’Disclosure of Accounting Policies’’

This amendment clarifies that when the scale or nature of a transaction, other event or situation is material, and the relevant accounting policy information is also material to the financial report, the relevant material accounting policy information should be disclosed. Conversely, if the enterprise determines that the scale or nature of a transaction, other event or situation is not significant or the relevant accounting policy information is not significant although it is significant, it does not need to disclose non-significant accounting policy information, but the enterprise prepares accounting the conclusion that the policy information is insignificant does not affect the relevant disclosures required by other IFRS standards.

G. Amendments to IAS 8 ‘’Definition of Accounting Estimates’’
This amendment defines accounting estimates as the monetary amount of financial statements subject to measurement uncertainty, and provides further explanations, except for corrections due to errors in the previous period, the impact of changes in input values or measurement techniques on accounting estimates is a change in accounting estimates.
H. Amendments to “ IFRS 16 “Leases regarding COVID-19-related rent concessions after June 30, 2021”

This amendment is to extend the applicable period of practical expedient practices related to the COVID-19-related rent concessions by one year later to assist the lessee in the relevant accounting treatment.

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As of the date the consolidated financial statements were issued, the Group continues in evaluating the impact on its financial position and financial performance as a result of the initial adoption of the aforementioned standards or interpretations and related applicable period. The related impact will be disclosed when the Group completes the evaluation.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Except for the following, the accounting policies applied in these consolidated financial statements are consistent with those applied in the consolidated financial statements for the year ended December 31, 2020. These policies have been consistently applied to all the periods presented, unless otherwise stated.

(1) Compliance statement

A. The accompanying consolidated financial statements have been prepared in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IAS 34, “Interim Financial Reporting”, endorsed and issued into effect by the FSC.
B. The consolidated financial statements should be read with the consolidated financial statements for the year ended December 31, 2020.

(2) Basis of preparation

A. Except for the following items, these consolidated financial statements have been prepared under the historical cost convention:
a. Financial assets and financial liabilities at fair value through other comprehensive income.
b. Defined benefit liabilities recognized based on the net amount of pension fund assets less present value of defined benefit obligation.
B. The preparation of financial statements in compliance with IFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.

(3) Basis of consolidation

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

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b. Inter-company transactions, balances and unrealized gains or losses on transactions between companies within the Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Group.
c. Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non-controlling interests. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.
d. Changes in a parent's ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary (transactions with non-controlling interests) are accounted for as equity transactions, i.e., transactions with owners in their capacity as owners. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity.
e. When the Group loses control of a subsidiary, the Group remeasures any investment retained in the former subsidiary at its fair value. That fair value is regarded as the fair value on initial recognition of a financial asset or the cost on initial recognition of the associate or joint venture. Any difference between fair value and carrying amount is recognized in profit or loss. All amounts previously recognized in other comprehensive income in relation to the subsidiary are reclassified to profit or loss or transferred directly to retained earnings as appropriate, on the same basis as would be required if the related assets or liabilities were disposed of. That is, when the Group loses control of a subsidiary, all gains or losses previously recognized in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss, if such gains or losses would be reclassified to profit or loss when the related assets or liabilities are disposed of.

B. The consolidated entities were as follows:

Investee / Subsidiary E-Shine Advanced Chemical Co., Ltd. Elsom Development Ltd. Spring World Holdings Ltd. Transsom Technology Co., Ltd.	Main Businesses	Percentage of Ownership	Percentage of Ownership	Percentage of Ownership
		March 31, 2021	December 31, 2020	March 31, 2020
	Chemical Investments Investments Manufacturing of synthetic resin and plastic product.	100.00% 100.00% 100.00% 100.00%	100.00% 100.00% 100.00% 100.00%	100.00% 100.00% 100.00% 100.00%

A. The financial statements of above-mentioned subsidiaries were not significant subsidiaries, those were not reviewed by independent auditors.
B. Changes in subsidiaries: None.
C. Subsidiaries not included in the consolidated financial statements: None.

－－ 13

D. Adjustments for subsidiaries with different balance sheet dates: None.
E. Material restrictions: None.
F. Contents of the parent company’s securities held by subsidiaries: None.
G. Subsidiaries that have non-controlling interest that are material to the Group: None.
(4) Income taxes

Income tax expense represents the sum of the tax currently payable and deferred tax. Interim period income taxes are assessed on an annual basis and calculated by applying to an interim period’s pre-tax income the tax rate that would be applicable to expected total annual earnings. The effect of a change in tax rate resulting from a change in tax law is recognized consistently with the accounting for the transaction itself which gives rise to the tax consequence, and this is recognized in profit or loss, other comprehensive income or directly in equity in full in the period in which the change in tax rate occurs.

(5) Retirement benefits

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

5. CRITICAL ACCOUNTING JUDGMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTION UNCERTAINTY

The same critical accounting judgments and key sources of estimates and uncertainty have been followed Note 5 in these consolidated financial statements as those applied in the preparation of the consolidated financial statements for the year ended December 31, 2020.

6. CONTENTS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

Item	March 31,2021	December 31,2020	March 31,2020
Cash on hand Checking account Demand deposits Cash equivalents – commercial paper (with original maturities within three months) Total	$486 90 355,034 40,000	$418 90 393,372 50,009	$341 90 184,123 -
	$395,610	$443,889	$184,554

A. The financial institutions dealing with the Group are credit worthy, and the Group does transactions with a number of financial institutions to diversify credit risk that are unlikely to be expected to default.
B. The Group had no cash and cash equivalents pledged to others.

－－ 14

(2) Notes receivable, net

(2) Notes receivable, net
Item	March 31, 2021	December 31, 2020	March 31, 2020
At amortized cost Notes receivable Less: Loss allowance Net	$23,906 (493)	$25,358 (483)	$25,219 (488)
	$23,413	$24,875	$24,731

A. The Group had no notes receivable pledged to others.
B. Please refer to Note 7(3) for the relevant disclosure of loss allowance for notes receivable.

(3) Accounts receivable, net

(3) Accounts receivable, net
Item	March 31,2021	December 31,2020	March 31,2020
At amortized cost Accounts receivable Less: Allowance for impairment loss Net	$1,334,690 (46,133)	$1,276,932 (36,736)	$1,114,767 (27,230)
	$1,288,557	$1,240,196	$1,087,537

A. Accounts receivable are created by the Group by selling goods, and the average collection period is 30~90 days. The Group’s accounts receivables all meet the credit standards stipulated based on the counterparties' industrial characteristics, operation scale and profitability. (The longest credit period on sales of goods is 165 days；the shortest period is 15 days.)
B. The Group had no account receivable pledged to others.
C. Please refer to Note 7(3) for transactions with related parties.
D. The Group applies the simplified approach to provisions for expected credit losses, which permits the use of a lifetime expected credit losses provision for trade receivables. The expected credit losses on trade receivables are estimated by reference to past account aging records of the debtor, an analysis of the debtor’s current financial position, and industrial trend. As the Group’s historical credit losses experience does not show significantly different loss patterns for different customer segments, the provision for losses based on past due status of notes receivables, accounts receivable and other receivable is not further distinguished between the Group’s different customer base.

－－ 15

E. The Group measures the loss allowance for notes receivable and accounts receivable (including other receivables) according to the preparation matrix:

Expected Credit LossRate	Gross Carrying Amount	Loss Allowance (LifetimeECL)
0%-1.5% 50% 50%-100% Expected Credit Loss Rate	$1,375,046 - 33,268	($19,755) - (26,871)
	$1,390,314	($46,626)
	Gross Carrying Amount	Loss Allowance (Lifetime ECL)
0%-1.5% 50% 50%-100% Expected Credit Loss Rate	$1,300,407 - 28,284	($16,847) - (20,372)
	$1,328,691	($37,219)
	Gross Carrying Amount	Loss Allowance (Lifetime ECL)
0%-1.5% 10% 50% 50%-100%	$1,148,070 336 2,448 10,425	($16,035) (34) (1,224) (10,425)
	$1,161,279	($27,718)

F. Movements of the loss allowance for notes, accounts receivable and other receivable were as follows:

F. Movements of the loss allowance for were as follows:	notes, accounts receivable and other receivable	notes, accounts receivable and other receivable
Beginning balance Add: Provision (Reversal) for impairment Less: Write-offs Ending balance	Three Months Ended March 31
	2021 $37,219 9,407 - $46,626	2020
		$27,955 (237) -
		$27,718

The above provision has not taken into consideration of collateral or other credit enhancement. The other credit enhancement possessed by above receivables was $9,348 thousand, $15,687 thousand and $98,072 thousand as of March 31, 2021, December 31, 2020 and March 31, 2020, respectively.

The Group writes off a trade receivable when there is information indicating that the

－－ 16

debtor is in severe financial difficulty and there is no realistic prospect of recovery of the receivable. For trade receivables that have been written off, the Group continues to engage in enforcement activity to attempt to recover the receivables which are due. Where recoveries are made, these are recognized in profit or loss. The Group's trade receivables for offsetting the contract amount both are $0 thousand for the three months ended March 31, 2021 and 2020.

G. Please refer to Note 12 for the relevant credit risk management and assessment method.

(4) Inventories and operating costs

Item	March 31,2021	December 31,2020	March 31,2020
Raw materials Supplies Work in process Finished goods Subtotal Less: Allowance for loss on inventory value decline and idleness Net	$ 564,014 19,312 49,060 529,682	$ 628,970 19,031 54,525 358,281	$ 441,890 14,932 56,934 424,919
	$ 1,162,068 (24,564)	$ 1,060,807 (47,012)	$ 938,675 (34,084)
	$ 1,137,504	$ 1,013,795	$ 904,591

A. The related inventory gain (loss) recognized as operating cost for the three months ended March 31, 2021 and 2020 were as follows:

ended March 31, 2021 and 2020 were	as follows:	as follows:
Item Cost of goods sold loss on physical inventory Other operating cost Loss on inventory valuation (recovery gain) Loss on onerous contract (recovery gain) Total	Three Months Ended March 31
	2021 $ 1,498,158 2,282 48,969 (22,448) 12,020 $ 1,538,981	2020
		$ 1,339,551 1,546 56,487 10,618 15,243
		$ 1,423,445

B. The Group recognized inventory valuation loss (gain) of ($22,448) thousand and $10,618 thousand for the three months ended March 31, 2021 and 2020, respectively, due to inventory’s write-down to net realizable value or the net realizable value of inventories recovered as a result of market stabilization that enabled the Group to raise prices on certain products.
C. The Group had no inventories pledged to others.

－－ 17

(5) Other financial assets - current

Item	March 31, 2021 $ 24,181 0.795%-1.045%	December 31, 2020	March 31, 2020
Time deposits (Note) Interest rate range		$ 18,681	$ 15,633
		0.795%-1.045%	1.045%

(Note)Restricted.

(6) Financial assets at fair value through other comprehensive income or loss - noncurrent

noncurrent
Item	March 31,2021 $ 51,295 106,460 $ 157,755 15,963 $ 173,718	December 31,2020 $ 51,295 106,460 $ 157,755 22,590 $ 180,345	March 31,2020
Equity instruments： Domestic unlisted stocks Foreign unlisted stocks Subtotal Valuation adjustment Total			$ 51,295 106,460
			$ 157,755 (9,150)
			$ 148,605

A. The Group invests in domestic and foreign unlisted stocks in accordance with its medium/long-term strategies and expects to make a profit through long-term investment. Management of the Group believes that it is not consistent with the afore-mentioned long-term investment planning if the short-term fair value changes of such investment are presented in profit or loss. Therefore, the Group elects to designate such investment as to be measured at FVTOCI.

B. For related credit risk management and means of assessing, please refer to Note 12.

(7) Investments accounted for using equity method

Item	March 31, 2021 $ 404,773 491,244 $ 896,017	December 31, 2020 $ 398,992 486,464 $ 885,456	March 31, 2020
Associates with significance: Unishine Chemical Corp. Associates without significance Total			$ 410,663 468,527
			$ 879,190

A. Associates:

(1) Significant associates of the Group were as follows:

Shareholding Percentage

CompanyName	March 31, 2021 49.98%	December 31, 2020 49.98%	March 31, 2020
Unishine Chemical Corp.			49.98%

Please refer to Table 6 in Note 13 for the nature of business, main operation location and countries of registration of the associates listed above.

－－ 18

(2) The summarized financial information in respect of the Group’s significant associates were as follows:
a. Balance Sheets

a. Balance Sheets
Current assets Noncurrent assets Current liabilities Noncurrent liabilities Equity Share in associates’ net assets Carrying amount of associate	Unishine Chemical Corp.
	March 31, 2021 $ 90,258 1,205,532 (423,485) (62,435) $ 809,870 $ 404,773 $ 404,773	December 31, 2020	March 31, 2020
		$ 78,733 1,205,488 (421,143) (64,775)	$ 83,277 1,204,341 (401,494) (64,470)
		$ 798,303	$ 821,654
		$ 398,992	$ 410,663
		$ 398,992	$ 410,663

b.Statements of Comprehensive Income

b.Statements of Comprehensive Income
	Unishine Chemical Corp.
	Three Months Ended March 31
	2021	2020
Operating revenue	$ 49,909	$ 21,364
Net income (loss)	$ 12,497	$ 11,884
Other comprehensive income (loss) (net after tax)	(930)	(8,000)
Total comprehensive income (loss)	$ 11,567	$ 3,884
Dividends received from associate	$ -	$ -
(3) Share of individually insignificant associates of the Group were summarized as
follows:
	Three Months	Ended March 31
	2021	2020
Share of:
Net income (loss)	$ 8,043	$ 4,112
Other comprehensive income (loss) (net after tax)	(3,272)	(8,374)
Total comprehensive income (loss)	$ 4,771	$ (4,262)

(3) Share of individually insignificant associates of the Group were summarized as follows:
B. The investments accounted for by the equity method and the share of profit or loss and other comprehensive income of those investments for the periods ended March 31, 2021 and 2020 were recognized based on the financial statements not reviewed by auditors for the same periods.
C. The Group had no investments accounted for using equity method pledged to others as of March 31, 2021, December 31, 2020 and March 31, 2020.

－－ 19

(8) Property, plant and equipment

Item	March 31, 2021	December 31, 2020	March 31, 2020
Land Buildings Machinery and equipment Utilities equipment Transportation equipment Office equipment Other equipment Equipment to be inspected and construction in progress Total cost Less: Accumulated depreciation Accumulated impairment Net	$ 1,356,883 1,415,254 1,407,887 386,888 59,655 52,269 1,821,158 1,054,085	$ 1,356,883 1,337,486 1,370,510 368,904 59,655 52,606 1,643,985 1,041,704	$ 1,356,883 1,335,708 1,362,649 366,511 59,571 49,968 1,624,286 484,231
	$ 7,554,079 (3,365,877) -	$ 7,231,733 (3,303,870) -	$ 6,639,807 (3,119,649) -
	$ 4,188,202	$ 3,927,863	$ 3,520,158

Land	Buildings	Machinery and Equipment	Miscellaneous Equipment (Note)	Equipment to be Inspected and Construction in Progress	Total
$ 1,356,883 - - - -	$ 1,337,486 - - 77,768 -	$ 1,370,510 2,152 (6,893) 42,118 -	$ 2,125,150 13,875 (507) 181,452 -	$ 1,041,704 314,796 - (301,338) (1,077)	$ 7,231,733 330,823 (7,400) - (1,077)
$ 1,356,883	$ 1,415,254	$ 1,407,887	$ 2,319,970	$ 1,054,085	$ 7,554,079
$ - - - -	$ 843,653 13,585 - -	$ 1,034,497 17,089 (6,893) -	$ 1,425,720 38,733 (507) -	$ - - - -	$ 3,303,870 69,407 (7,400) -
$ -	$ 857,238	$ 1,044,693	$ 1,463,946	$ -	$ 3,365,877

－－ 20

Cost	Land	Buildings	Machinery and Equipment	Miscellaneous Equipment (Note)	Equipment to be Inspected and Construction in Progress	Total
	$ 1,303,910 - - 52,973 -	$ 1,340,422 - (6,744) 2,030 -	$ 1,360,775 618 (392) 1,648 -	$ 2,088,196 8,763 (2,989) 6,366 -	$ 366,084 182,114 - (63,017) (950)	$ 6,459,387 191,495 (10,125) - (950)
Balance at January 1, 2020 Additions Disposals Reclassification Transfer to expenses Balance at March 31, 2020 Accumulated depreciation and impairment
	$ 1,356,883	$ 1,335,708	$ 1,362,649	$ 2,100,336	$ 484,231	$ 6,639,807
	$ - - -	$ 798,050 13,620 (6,743)	$ 973,376 17,111 (392)	$ 1,288,215 39,369 (2,957)	$ - - -	$ 3,059,641 70,100 (10,092)
Balance at January 1, 2020 Depreciation Disposals Balance at March 31, 2020
	$ -	$ 804,927	$ 990,095	$ 1,324,627	$ -	$ 3,119,649

(Note) Including utilities equipment, transportation equipment, office equipment and other equipment.

A. Reconciliations of current additions and the acquisition of property, plant and equipment in statement of cash flows were as follows:

Item Increase in property, plant and equipment Increase/decrease in equipment payable Cash paid for acquisition of property, plants and equipment	Three Months Ended March 31	Three Months Ended March 31
	2021 $ 330,823 (32,788) $ 298,035	2020
		$ 191,495 (17,497)
		$ 173,998

B. The details of interest capitalized: Please refer to Note 6(26).
C. Impairment losses for property, plant and equipment: None.
D. Property, plant and equipment pledged for the borrowings: Please refer to Note 8.
E. Property, plant and equipment are depreciated using the straight-line method to allocate their cost over their estimated useful lives. The estimated useful lives as follows:

Buildings:

Main building, 3 to 55 years Engineering system, 5 to 11 years Others, 5 to 11 years

Machinery and equipment, 3 to 20 years

Utilities equipment, 5 to 15 years

Transportation equipment, 5 to 6 years

Office equipment, 5 to 11 years Other equipment, 3 to 20 years;

－－ 21

F. As of March 31, 2021, December 31, 2020 and March 31, 2020, part of the land of the Group amounting to $71,468 thousand was unable to be registered under the name of the Group due to regulation restriction. Accordingly, the ownership was registered under the name of an individual with a mortgage registration amounting to $71,468 thousand, $71,468 thousand and $18,495 thousand as safeguard measures, respectively.

(9) Lease agreement

A. Right-of-use assets

(9) Lease agreement A. Right-of-use assets
Item	March 31, 2021		December 31, 2020		March 31, 2020
Land Building and equipment Total cost Less: Accumulated depreciation Net Cost	$	185,402 4,272	$	185,402 4,272	$ 60,641 4,272
	$	189,674 (15,304)	$	189,674 (12,609)	$ 64,913 (5,692)
	$	174,370	$	177,065	$ 59,221
		Land		Buildings and equipment	Total $ 189,674 - - $ 189,674 $ 12,609 2,695 - $ 15,304 Total $ 64,913 - - $ 64,913 $ 4,448 1,244 - $ 5,692
Balance at January 1, 2021 Additions Disposals Balance at March 31, 2021 Accumulated Depreciation
Balance at January 1, 2021 Depreciation Disposals Balance at March 31, 2021 Cost
Balance at January 1, 2020 Additions Disposals Balance at March 31, 2020 Accumulated Depreciation
Balance at January 1, 2020 Depreciation Disposals Balance at March 31, 2020

－－ 22

、 Right-of-use assets of the Group had no significant addition subleasing and impairment for the three months ended March 31, 2021 and 2020.

B. Lease liabilities

B. Lease liabilities
Item	March 31, 2021	December 31, 2020	March 31, 2020
		$ 4,278	$ 4,707
	$ 119,088	$ 119,960	$ 54,481
			March 31, 2020
Land Buildings and equipment	1.2% 1.2%	1.2% 1.2%	1.2% 1.2%

Please refer to Note 12(3) for lease liabilities with repayment periods.

C. Material lease-in activities and terms

The Group leased some land and buildings for operations and as dormitory, with the lease terms of 2 to 29 years. Part of the lease may be extended with its duration and is calculated based on the area of the land leased and the rate based on the announced land value of the current year. In accordance with the contract, without the lessor’s consent, the Group is not allowed to sublet the leased object to the third party.

D. Subleasing: None.

E. Other lease information:
(1) Please refer to Note 6(10) for agreement to lease investment properties under operating lease.
(2) The current lease relevant expense information was as follows:

Short-term lease expense Low-value asset lease expense Variable lease payments that excluded in the measurement of lease liabilities Total cash outflow for leases (Note)	Three Months Ended March 31	Three Months Ended March 31
	2021 $ 255 $ 36 $ 1,877 $ 3,542	2020
		$ 189
		$ 30
		$ 1,995
		$ 3,190

(Note): Including current principle paid for lease liabilities.

The Group does not recognize right-of-use assets and lease liabilities for all leases for short-term leases and low-value asset leases accounted for by applying a recognition exemption.

－－ 23

(10) Investment properties, net

Item	March 31, 2021	December 31, 2020	March 31, 2020
Land Buildings and equipment Total cost Less: Accumulated depreciation Net Cost Balance at January 1, 2021 Additions Balance at March 31, 2021 Accumulated depreciation Balance at January 1, 2021 Depreciation Balance at March 31, 2021 Cost Balance at January 1, 2020 Additions Balance at March 31, 2020 Accumulated depreciation Balance at January 1, 2020 Depreciation Balance at March 31, 2020	$ 50,888 177,882	$ 50,888 177,882	$ 50,888 177,882
	$ 228,770 (99,022)	$ 228,770 (97,761)	$ 228,770 (93,975)
	$ 129,748	$ 131,009	$ 134,795
	Land $ 50,888 - $ 50,888 $ - - $ - Land $ 50,888 - $ 50,888 $ - - $ -

A. Above mentioned investment properties were land and buildings located at Section 2 of Dunhua Section, Songshan District, Taipei City, and Zhubei City, Hsinchu County with the lease periods of 1 to 5.25 years. These arrangements do not contain renewal or purchase options at the end.

－－ 24

B. Rental income and direct operating expenses of investment properties were shown below:

below:
Item Rental income of investment properties Direct operating expense incurred for the investment properties with current rental income Direct operating expenses incurred by the investment properties with no rental revenue generating in current period	Period Ended March 31
	2021 $10,843(Note1) $ 1,583 $ 28	2020 $11,609(Note2) $ 1,704 $ 28

(Note1) Including recognized as operating revenue $10,605 thousand and other income $238 thousand.
(Note2) Including recognized as operating revenue $11,371 thousand and other income $238 thousand.
C. The maturity analysis of operating lease payments receivable for investment properties is as follows:

Year 1 Year 2 Year 3 Year 4 Year 5 Over 5 years Total	March 31, 2021	December 31, 2020 $ 33,025 20,044 13,733 5,740 - - $ 72,542	March 31, 2020
	$ 29,455 18,764 12,416 3,280 - -		$ 29,234 18,512 11,548 9,840 3,280 -
	$ 63,915		$ 72,414

D. Investment property is depreciated on a straight-line basis over its estimated useful life of 3 to 50 years.
E. The fair values of investment properties held by the Group were $427,480 thousand, $427,480 thousand and $429,742 thousand as of March 31, 2021, December 31, 2020 and March 31, 2020, respectively. The fair value determination was performed by the Group’s management, based on the data reference to the similar transaction price in the market from the public listing real estate transaction data, and the fair value was measured by using Level 3 inputs.
F. The Group had no investment properties pledged to others.

－－ 25

(11) Intangible assets

(11) Intangible assets
Item	March 31,	2021	December 31, 2020	March 31, 2020
	$	13,613 (6,023)	$ 10,442 (4,685)	$ 9,510 (4,133)
	$	7,590	$ 5,757	$ 5,377
			Cost	Computer Software $ 9,510 - - $ 9,510 $ 3,197 936 $ 4,133

		Balance on January 1, 2020 Additions Transfer from property, plant and equipment Balance on March 31, 2020 Accumulated amortization


		Balance on January 1, 2020 Amortization expense Balance on March 31, 2020

(12) Short-term loans

Item	March 31, 2021	December 31, 2020	March 31, 2020
Unsecured loan Interest range (13) Other payables Item	$ 290,000	$ 290,000	$ 516,000
	0.72%	0.72%	0.80%-0.86%
	March 31,2021	December 31,2020	March 31,2020
Salaries and bonus Compensation to employees and - current period Remuneration to directors - previous period Equipment Fuel cost Shipping fee Discount and expenses Others Total	$ 155,887 50,836 46,500 57,714 20,427 32,071 78,799 110,863	$ 146,919 176,120 - 24,926 20,159 30,387 65,283 108,440	$ 113,888 35,081 33,800 77,216 27,057 18,012 70,166 91,990
	$ 553,097	$ 572,234	$ 467,210

－－ 26

(14) Provisions - current

(14) Provisions - current
Item	March 31,2021		December 31,2020			March 31,2020
	$	15,302 16,345	$	13,616 4,325	$	14,528 15,243
	$	31,647	$	17,941	$	29,771
				Onerous contract		Total $ 17,941 15,967 (2,261) $ 31,647

Item January 1, 2020 Recognized in current period Used in current period March 31, 2020	Employee benefits $ 16,398 3,760 (5,630) $ 14,528	Onerous contract $ - 15,243 - $ 15,243	Total
			$ 16,398 19,003 (5,630)
			$ 29,771

Provision for employee benefits is an estimate of the short-term service leave vested to employees.
Provision for onerous contracts are material purchase contracts in which the Group’s unavoidable costs of meeting the contractual obligations exceed the economic benefits expected to be received from the contract.

(15) Long-term loans

(15) Long-term loans
Item	March 31, 2021	December 31, 2020	March 31, 2020
Parent Company Credit loans Subsidiary Credit loans Secured loan Subtotal Less: current portion Long-term loans Interest rate range	$ 500,000 - 211,790	$ 500,000 74,399 99,480	$ - - 100,000
	$ 711,790 (127,560)	$ 673,879 (127,560)	$ 100,000 (7,200)
	$ 584,230	$ 546,319	$ 92,800
	0.05%-0.8931%	0.05%-0.8931%	0.891%

A. Refer to Note 8 for assets pledged as collateral for long-term loans.

－－ 27

B. Under the above loan contract, the Company should maintain debt ratio and interest coverage ratio at a certain level, calculated based on the audited annual consolidated financial statements for the duration of the contracts. As of March 31, 2021, the Company had no irregularities.
C. Under the above loan contract, the subsidiary should maintain current ratio, debt ratio and interest coverage ratio at a certain level, calculated based on the audited annual consolidated financial statements for the duration of the contracts. As of March 31, 2021, the subsidiary had no irregularities.
D. The normal interest rate range of the Group were 0.75% - 0.8931%. One subsidiary received government low-interest rate loans $74,399 thousand due to the application of the accelerated investment action plan, the interest rate range were 0.05% - 0.08%.

(16) Pension

A. Defined contribution plans
a.The plan under the Labor Pension Act (the “Act”) is deemed a defined contribution plan. Pursuant to the Company and E-Shine Advanced Chemical Co., Ltd. have made monthly contributions equal to 6% of each employee’s monthly salary to employees’ pension accounts.
b.The total expenses recognized in the consolidated statement of comprehensive income were $4,227 thousand and $3,717 thousand, representing the contributions payable to these plans by the Group at the rates specified in the plans for the three months ended March 31, 2021 and 2020, respectively.

B. Defined benefit plans

a. The pension under the defined benefit plans were $326 thousand and $372 thousand for the three months ended March 31, 2021 and 2020. The pensions were calculated using the actuarially determined pension cost discount rates as of December 31, 2020 and 2019.
b. Before the end of 2020 and 2019, the Group assesses the balance in the Labor Retirement Account. If the amount of the balance in the Account is inadequate to pay retirement benefits for employees who confirm to retirement requirements in the next year, the Group funded the difference and reduce net defined benefit liability in March 2021 and 2020 for $77 thousand and 2,054 thousand, respectively.

－－ 28

(17) Share capital

A. Movements in the number of the Group's ordinary shares outstanding were as follows:

follows:
Item Balance at January 1 Capital increase in cash Capitalization of retained earnings Balance at March 31 Item Balance at January 1 Capital increase in cash Capitalization of retained earnings Balance at March 31	Three months Ended March 31, 2021
	Shares (in thousands) Amount 180,000 $1,800,000 - - - - 180,000 $1,800,000 Three months Ended March 31, 2020	Amount
		$1,800,000 - -
		$1,800,000
	Shares (in thousands) 150,000 - - 150,000	Amount
		$1,500,000 - -
		$1,500,000

B. As of March 31, 2021, the authorized capital was $2,000,000 thousand, consisting of 200,000 thousand shares.

(18) Capital surplus

Item	March 31, 2021	December 31, 2020	March 31, 2020
Share premium From associates accounted for using equity method Total	$ 101,165 2,559	$ 101,165 2,559	$ 101,165 2,559
	$ 103,724	$ 103,724	$ 103,724

Under the Company Act, the capital surplus generated from the excess of the issuance price over the par value of capital stock and donations can be used to offset deficit or may be distributed as stock dividends or in cash. Under the regulations of the Security Exchange Law, the maximum amount transferred from the foregoing capital surplus to the Company's capital per year shall not be over 10% of the Company's paid-in capital. Capital surplus can't be used to offset deficit unless legal reserve is insufficient. The capital surplus from Investments accounted for using equity method should not be used for any purpose.

(19) Retained earnings and dividend policy

(1) In accordance with the dividend policy as set forth in the Company’s Articles of Incorporation, where the Company made profit in a fiscal year, the profit shall be

－－ 29

first utilized for paying taxes, offsetting losses of previous years, setting aside as legal reserve 10% of the remaining profit, setting aside a special reserve in accordance with the laws and regulations, and the remainder plus prior year’s unappropriated earnings may be used as dividends or bonus for shareholders after proposed by the Board of Directors and resolved by the shareholders meeting.

In consideration of its operation and capital expenditure demands, the Company stipulates appropriate dividend distribution ratio, and proposes for approval in the shareholders’ meeting. However, at least 10% of total dividends should be distributed in cash.

(2) Legal reserve may be used to offset a deficit, and be transferred to capital or distributed in cash. However, legal reserve can be transferred to capital or distributed in cash only when the legal reserve has exceeded 25% of the Company's paid-in capital.

(3) Special reserve

paid-in capital. (3) Special reserve
Item	March 31, 2021	December 31, 2020	March 31, 2020
Provision for the debit balance of other equity Provision for initial application of IAS Total	$ 73,294 32,596	$ 73,294 32,596	$ 48,323 32,596
	$ 105,890	$ 105,890	$ 80,919

A. The Company may allocate earnings only after providing special reserve for debt balance in other equity on the date of balance sheet, and the reversal of debit balance in other equity, if any, may be stated into allocable earnings.
B. Upon first-time adoption of IFRSs, the special reserve provided pursuant to the official letter under Jin-Guan-Jheng-Fa-Zih No. 1010012865 dated April 6, 2012 may be reversed to allocable retained earnings in proportion to the special reserve as provided originally, if the Company uses, disposes of or reclassifies the relevant assets in the future.
(4) The appropriation of earnings for 2020 was proposed by the Board of Directors’ meeting held in February 2021, while the appropriation of earnings for 2019 was approved by the stockholders’ meeting held in May 2020. The details of appropriation are as follows:

Item Legal reserve Special reserve Cash dividends Total	Appropriation of Earnings 2020 2019 $ 117,397 $ 88,892 1,280 24,971 628,000 330,000 200,000 300,000 $ 946,677 $ 743,863	Dividends Per	Share(NT$)
	2020 $ 117,397 1,280 628,000 200,000 $ 946,677	2020 $ 3.49 1.11	2019
			$ 2.20 2.00

－－ 30

The appropriations of earnings for 2020 are subject to the resolution of the shareholders’ meeting to be held in May 2021.

(5) Information on the earnings appropriation proposed by the Board of Directors and approved by the shareholders is available on the “Market Observation Post System” on the website of TWSE.

(20) Other equity

Item	Exchange differences on translation of foreign financial statements	Unrealized gain (loss) on financial asset at fair value through other comprehensive income	Total
Balance, January 1, 2021 Exchange differences arising on translation of foreign operations Unrealized gain (loss) on financial assets at fair value through other comprehensive income Share of associates and joint ventures accounted for using equity method Balance, March 31, 2021 Item	$ (129,761) (2,618) - (465)	$ 22,590 - (6,627) -	$ (107,171) (2,618) (6,627) (465)
	$ (132,844)	$ 15,963	$ (116,881)
	Exchange differences on translation of foreign financial statements	Unrealized gain (loss) on financial asset at fair value through other comprehensive income	Total $ (105,890) (6,699) (26,863) (3,999) $ (143,451)
Balance, January 1, 2020 Exchange differences arising on translation of foreign operations Unrealized gain (loss) on financial assets at fair value through other comprehensive income Share of associates and joint ventures accounted for using equity method Balance, March 31, 2020	$ (123,603) (6,699) - (3,999)	$ 17,713 - (26,863) -
	$ (134,301)	$ (9,150)

(21) Operating revenues

perating revenues
Item Revenue from contracts with customers Revenue from sales of finished goods Revenue from sales of raw materials Processing revenue	Three Months Ended March 31 2021 2020 $ 1,811,218 $ 1,460,738 432,411 454,301 53,883 67,748
	2021 $ 1,811,218 432,411 53,883

－－ 31

Total sales revenue from contracts with customers Less: Sales return Sales discount Net Other operating revenue Net operating revenue	$ 2,297,512 (1,415) (12,900) $ 2,283,197 10,605 $ 2,293,802	$ 1,982,787 (1,427) (14,361)
		$ 1,966,999 11,371
		$ 1,978,370

A. Explain of contract revenue

The sales and processing revenue of chemical raw materials and products (including electronic grade chemical solvents) are mainly targeted at downstream manufacturers, and those are sold at a fixed price as agreed in the contract.

B. Other operating revenue

Revenue from operating leases is recognized on a straight-line basis over the terms of the relevant leases.

C. Segments of revenue from contracts with customers

The Group’s source of revenue can be split into the following main service lines and areas:

(1) Segmented by revenue from different types:

Three months ended March 31, 2021：

Main area of market Taiwan South Korea Vietnam Thailand Others Total Major service line Yeong An plant Changhua Coastal plant Total Timing of revenue recognition Revenue recognized at a specific timing Revenue recognized over time Total	Chemicalproduct $ 1,622,008 234,402 89,325 56,320 227,259 $ 2,229,314 $ 2,001,476 227,838 $ 2,229,314 $ 2,229,314 - $ 2,229,314	Processing $ 53,883 - - - - $ 53,883 $ 53,175 708 $ 53,883 $ 53,883 - $ 53,883	Total
			$ 1,675,891 234,402 89,325 56,320 227,259
			$ 2,283,197
			$ 2,054,651 228,546
			$ 2,283,197
			$ 2,283,197 -
			$ 2,283,197

－－ 32

Three months ended March 31, 2020：

Main area of market Taiwan South Korea Vietnam Thailand Others Total Major service line Yeong An plant Changhua Coastal plant Total Timing of revenue recognition Revenue recognized at a specific timing Revenue recognized over time Total	Chemicalproduct $ 1,365,090 248,309 71,424 36,326 178,102 $ 1,899,251 $ 1,710,325 188,926 $ 1,899,251 $ 1,899,251 - $ 1,899,251	Processing $ 67,748 - - - - $ 67,748 $ 67,748 - $ 67,748 $ 67,748 - $ 67,748	Total
			$ 1,432,838 248,309 71,424 36,326 178,102
			$ 1,966,999
			$ 1,778,073 188,926
			$ 1,966,999
			$ 1,966,999 -
			$ 1,966,999

D. Contract balances

The Group recognized the receivables, contract assets and contract liabilities in relation to contract revenue as follows:

March 31, 2021	December 31, 2020	March 31, 2020	January 1, 2020
$ 1,311,694 -	$ 1,264,764 -	$ 1,111,899 -	$ 1,177,931 -
$ 1,311,694	$ 1,264,764	$ 1,111,899	$ 1,177,931
$ 15,937	$ 10,916	$ 6,227	$ 5,403

(Note) Including notes receivable and accounts receivable.

a. Significant changes in contract assets and contract liabilities

The change in the contract assets and contract liabilities primarily result from the timing difference between the satisfaction of performance obligation and the customer’s payment, and there is no other significant change.

b. Allowance for contract assets: None.
c. Amount from previous period’s satisfied performance obligations and beginning contract liabilities recognized in the current period as income were as follows:

－－ 33

Revenue in the current period	Three Months Ended March 31	Three Months Ended March 31
	2021	2020
From beginning contract liabilities From previous period’s satisfied performance obligations	$10,916	$5,403
	$ -	$ -

(22) Labor cost, depreciation and amortization

Three Months ended March 31, 2021

	Three Months ended March 31,	Three Months ended March 31,	2021
Item Labor cost Salaries Insurance Pension Others Depreciation (Note) Amortization Total Item Labor cost Salaries Insurance Pension Others Depreciation (Note) Amortization Total	Operating cost Operating expenses $ 46,109 $ 132,089 4,003 6,359 1,801 2,752 1,693 2,788 42,891 30,197 23 1,315 $ 96,520 $ 175,500 Three Months ended March 31,		Total
			$ 178,198 10,362 4,553 4,481 73,088 1,338
			$ 272,020
			2020
	Operating cost $ 35,000 3,189 1,557 2,190 43,720 - $ 85,656	Operating expenses $ 77,316 5,476 2,532 2,218 28,689 936 $ 117,167	Total
			$ 112,316 8,665 4,089 4,408 72,409 936
			$ 202,823

(Note) Not including depreciation of Investment properties $275 thousand recognized as other gains and losses for the three months end March 31, 2021 and 2020 .

A. The Articles of Incorporation of the Company stipulated the Company to distribute employees’ compensation and remuneration of directors and supervisors at the rates no less than 6% and no higher than 3%, respectively, of net profit before income tax, employees’ compensation and remuneration of directors and supervisors. The Company accrued employees’ compensation $36,336 thousand

－－ 34

and $24,581 thousand, remuneration to directors and supervisors $14,500 thousand and $10,500 thousand for the three months ended March 31, 2021 and 2020, respectively. At the rates not less than 6% and not higher than 3% of net income, employees’ compensation and remuneration to directors.

B. The employees’ compensation and remuneration to directors for the years ended December 31, 2020 and 2019 had been approved by the Company’s Board of Directors meeting held on February 25, 2021 and 2020, respectively, and the relevant amounts recognized in the consolidated financial statements were as follows:

Year ended December 31	Year ended December 31	Year ended December 31	Year ended December 31
2020		2019
Employees’ compensation	Remuneration to directors	Employees’ compensation $ 93,079 93,079 $ -	Remuneration to directors
$ 129,620 129,620	$ 46,500 46,500		$ 33,800 33,800
$ -	$ -		$ -

The above-mentioned employees’ compensation will be paid by cash.

C. Information about the appropriation of employees’ compensation and directors’ remuneration by the Company as resolved by the Board of Directors can be obtained from the “Market Observation Post System” on the website of TWSE.

(23)Interest income

(23)Interest income
Item Interest on bank deposits	Three months ended March 31
	2021 $72	2020
		$34

(24) Other income

(24) Other income
Item Rental income Additional services Others Total	Three Months Ended March 31
	2021 $ 238 1,967 1,721 $ 3,926	2020
		$ 238 1,563 1,507
		$ 3,308

－－ 35

(25) Other gains and losses

Three Months Ended March 31

Item Net currency exchange gain (loss) Gain (loss) on disposal of property, plant and equipment Depreciation of Investment properties Others Total	2021 $ 1,731 - (275) (194) $ 1,262

(26) Finance costs

(26) Finance costs
	Three	Months	Ended March 31
Item	2021		2020
Interest on loans	$	1,765	$	1,508
Interest on lease liabilities		183		169
Less: capitalized amount for qualified assets		(1,498)		-
Carrying amount	$	450	$	1,677

(27) Income tax

A. Components of tax expense:

Current income tax Income tax incurred in current year Prior year income tax (over) under estimation Total Deferred income tax The origination and reversal of temporary differences Total Income tax expense	Three Months Ended March 31 2021 2020 $ 94,549 $ 73,252 - 1,829 $ 94,549 $ 75,081 $ (1,584) $ (7,737) $ (1,584) $ (7,737) $ 92,965 $ 67,344
	2021 $ 94,549 - $ 94,549 $ (1,584) $ (1,584) $ 92,965

B. Income tax expense (benefit) recognized in other comprehensive income were as follows:

follows:
Item Exchange differences on translation of foreign financial statements	Three Months Ended March 31 2021 2020 ($654) ($1,675)
	2021
	($654)

－－ 36

C. The applicable tax rate used by the Group is 20%. In addition, the tax rate applicable to unappropriated earning is 5%. Tax rates used by other group entities operating in other jurisdictions are based on the tax laws in those jurisdictions.
D. The tax authorities have rectified Company’s income tax returns through 2018.

(28) Other comprehensive income (loss)

Year Ended March 31, 2021	Year Ended March 31, 2021	Year Ended March 31, 2021
Income Tax Before Tax Benefit (Expense) Net of Tax $ (6,627) $ - $ (6,627) $ (6,627) $ - $ (6,627) $ (3,272) $ 654 $ (2,618) (465) - (465) $ (3,737) $ 654 $ (3,083) $ (10,364) $ 654 $ (9,710) Year Ended March 31, 2020		Net of Tax
		$ (6,627)
		$ (6,627)
		$ (2,618) (465)
		$ (3,083)
		$ (9,710)
Before Tax $ (26,863) $ (26,863) $ (8,374) (3,999) $ (12,373) $ (39,236)	Income Tax Benefit (Expense) $ - $ - $ 1,675 - $ 1,675 $ 1,675	Net of Tax
		$ (26,863)
		$ (26,863)
		$ (6,699) (3,999)
		$ (10,698)
		$ (37,561)

－－ 37

(29) Earnings per share

Item (1) Basic earnings per share: Net income attributable to shareholders of parent company Weighted average shares outstanding (in thousands) Basic earnings per share (after tax) (2) Diluted earnings per share: Net income attributable to shareholders of parent company Effect of potential dilutive ordinary shares Net income used in computation of diluted earnings per share Weighted average shares outstanding (in thousands) Impact on employees' compensation (Note) Weighted average number of ordinary shares outstanding after dilution (in thousands) Diluted earnings per share (after tax)	Three Months Ended March 31	Three Months Ended March 31
	2021 $ 377,995 180,000 $ 2.10 $ 377,995 - $ 377,995 $ 180,000 1,079 $ 181,079 $ 2.09	2020
		$ 271,498 180,000
		$ 1.51
		$ 271,498 -
		$ 271,498
		$ 180,000 1,150
		$ 181,150
		$ 1.50

(Note) Since the Company offered to settle compensation paid to employees in cash or shares, the Company assumed the entire amount of the compensation would be settled in shares and the resulting potential shares were included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, as the effect is dilutive. Such dilutive effect of the potential shares is included in the computation of diluted earnings per share until the number of shares to be distributed to employees is resolved in the following year.

7. RELATED PARTY TRANSACTIONS

(1) Parent Company and ultimate controlling party:

The Group has no parent Company and ultimate controlling party.

(2) Related party name and category:

Related PartyName Unishine Chemical Corp. Shanghai Liansheng Chemistry Co., Ltd. AZOTEK CO., LTD. Ninghan Development Co., Ltd.	Related PartyCategory Associate Associate Other related party Other related party

－－ 38

(3) Significant transactions with related parties:
A. Sales:

Three Months Ended March 31

Item	Related PartyCategory Other related party	2021 $7,948	2020
Sale revenue			$2,416

B. Purchase: None.
C. Contract assets: None.
D. Contract liabilities: None.
E. Balance of receivables (excluding lending to related parties and contract assets):

Item	Related Party Category	March 31, 2021	December 31, 2020	March 31, 2020
Accounts receivables Other receivables	Other related party Associates	$8,345	$6,469	$2,552
		$15	$575	$256

F. Balance of payables (excluding borrowing from related parties): None.
G. Prepayments: None.
H. Property transactions: None.
I. Lessee arrangements:

Three Months Ended March 31

Item Related PartyCategory Acquisition of right-of-use asset Other related parties Item Related Party Category March 31, 2021 Lease liabilities Other related parties $2,099 Item Related PartyCategory Interest expense Other related parties	Item Related PartyCategory Acquisition of right-of-use asset Other related parties Item Related Party Category March 31, 2021 Lease liabilities Other related parties $2,099 Item Related PartyCategory Interest expense Other related parties	2021 $ - December 31, 2020	2020
			$ -
Lease liabilities Item	$2,099	$2,187

		2021 $6
Interest expense

Above lease terms were based on contracts, and rent was paid monthly.

J. Rent arrangements: None.
K. Financing activities - lending to related parties: None.
L. Financing activities - borrowing from related parties: None.

－－ 39

M. Guarantee for related parties:

Related Party Category Associates Unishine Chemical Corp.	March 31, 2021	December 31, 2020 $241,080	March 31, 2020 $192,080
	$241,080

N. Others:

a. Miscellaneous income

N. Others: a. Miscellaneous income
Related Party Category Associates	Three Months Ended March 31
	2021 $ -	2020
		$256

Miscellaneous income was mainly technical service and endorsement/guarantee income.

(4) Key management compensation

Three Months Ended March 31

Item Salaries and other short-term employee benefits Post-employment benefits Total 8. PLEDGED ASSETS Item March 31,2021 Property, plant and equipment (net) $ 688,413 Other financial assets – current 24,181 Refundable deposits 400 Total $ 712,994		2021 $17,518 27 $17,545 December 31,2020		2020 $13,343 54 $13,397 March 31,2020 $ 691,756 15,633 400 $ 707,789


Property, plant and equipment (net) Other financial assets – current Refundable deposits Total

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT

COMMITMENTS

(1) As of March 31, 2021, December 31, 2020 and March 31, 2020, the Group issued guarantee notes for bank loans amounting to $3,991,209 thousand (included USD 45,250 thousand), $3,768,720 thousand (included USD 45,250 thousand) and $2,937,500 thousand (included USD 25,250 thousand), respectively.
(2) As of March 31, 2021, December 31, 2020 and March 31, 2020, Guarantee notes received by the Group for its contract performance and creditor’s right totaled $417,034 thousand, $357,121 thousand and $382,108 thousand, respectively.
(3) As of March 31, 2021, December 31, 2020 and March 31, 2020, guarantee notes issued by the Group for purchasing equipment totaled $0 thousand, $0 thousand and $33,763 thousand, respectively.

－－ 40

(4) As of March 31, 2021, December 31, 2020 and March 31, 2020, guarantees provided by banks to the Group for bonded warehouse were both USD $3,000 thousand.
(5) As of March 31, 2021, December 31, 2020 and March 31, 2020, the unused letters of credit issued by the Group were as follows:

(In thousands) Item March 31, 2021 December 31, 2020 March 31, 2020 L/C Amount USD 1,882 USD 2,740 USD 15

(6) As of March 31, 2021, December 31, 2020 and March 31, 2020, the note endorsement for imported goods were as follows:

(In thousands) Item March 31, 2021 December 31, 2020 March 31, 2020 USD $89 $2,170 $3,426

(7) As of March 31, 2021, December 31, 2020 and March 31, 2020, the Group provided guarantees for others. Please refer to Note 13 for the information.
(8) Part of property, plant and equipment was unable to be registered under the name of the Group due to regulation restriction. Accordingly, the ownership was registered under the name Ching-yuan Sun, please refer to Note 6.(8).
(9) The Group entered a processing contract with Lyondellbasell Taiwan CO., Ltd. Materials (Ox propane, methanol and catalyst) were provided by Lyondellbasell Taiwan CO., Ltd. then processed by the Group into PM and DPM. Processing revenue were $53,883 thousand and $67,748 thousand for the three months ended March 31, 2021 and 2020, respectively.
(10) Establishment of important construction contracts
(a)As of March 31, 2021, estimated total contract costs, contract costs paid, and expected completion years were summarized below:

Type of construction	Contract price	Construction costpaid	Expected year of completion
Intercontinental Container Terminal logistics center	$ 2,561,618	$ 653,283	2022
Purificationprocess(small amount)	340,441	1,684	2022
Purificationprocess	338,500	45,802	2022
Blendingtank Phase II	162,407	69,570	2021
Tanks - Changhua Coastal 3rdplant	277,980	173,687	2021

－－ 41

(b)As of December 31, 2020, estimated total contract costs, contract costs paid, and expected completion years were summarized below:

Type of construction	Contract price	Construction costpaid	Expected year of completion
Intercontinental Container Terminal logistics center	$ 2,561,618	$ 510,617	2022
Blendingtank and fillingstation	328,885	279,867	2021
Blendingtank Phase II	162,407	40,415	2021
Tanks - Changhua Coastal 3rdplant	228,249	118,716	2021

(c)As of March 31, 2020, estimated total contract costs, contract costs paid, and expected completion years were summarized below:

Type of construction	Contract price	Construction costpaid	Expected year of completion
Tanks - Changhua Coastal 3rd plant	$ 121,278	$ 50,612	2020
Intercontinental Container Terminal logistics center	485,324	245,786	2020
Blendingtank and fillingstation	248,589	158,433	2020

(11)The Group signed a land lease contract with Kaohsiung branch of Taiwan International Ports Corporation, Ltd. in December 2013. Kaohsiung Port Intercontinental Container Center 2nd Phase Project Petrochemical Oil Storage and Transportation Center S12-S15 Pier Post line Land was leased and the Group invested to build the construction of petrochemical oil storage and transportation facilities for the purpose of import and export and transport of petrochemical oil handling, storage and transportation. Kaohsiung branch of Taiwan International Ports Corporation, Ltd. should deliver the land to the Group before the end of December 2017. The term of the lease was 25 years from the date of delivery and the Group had the right to renew the lease at the end of the period. Per the contract, the Group had to pay rent at 5% of value of leased land since the land was delivered. 3 years and 6 months from the land delivery date, the Group need to pay the management fees of $13,817 thousand per year. Kaohsiung branch of Taiwan International Ports Corporation, Ltd. already completed the transaction procedure before November 2017. The Group started to implement land improvement project and started paying the land rent of those projects, which were both $535 thousand for years ended March 31, 2021 and 2020.

10. SIGNIFICANT DISASTER LOSS: NONE.

11. SIGNIFICANT SUBSEQUENT EVENTS: NONE.

12. OTHERS

(1) Seasonality or periodicity of operations

The operation of the Group's is not influenced by seasonality and periodicity.

－－ 42

(2) Capital risk management

There were no significant changes in the Group's policies for capital risk management for the three months ended March 31, 2021 as compared with the consolidated financial statements for the year ended December 31, 2020. Please refer to Note 12(1) of the consolidated financial statements for the year ended December 31, 2020 for the related information.

(3) Financial instruments
A. Financial risk of financial instruments

Financial risk management policies

The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk. The Group’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Group’s financial performance.

The plans for material treasury activities are reviewed by board of directors in accordance with procedures required by relevant regulations or internal controls. During the implementation of such plans, the Group Treasury function must comply with certain treasury procedures that provide guiding principles for overall financial risk management and segregation of duties.

Significant financial risks and degrees of financial risks

a. Market risk
(a) Foreign exchange rate risk

There were no significant changes in the nature and degree of material financial risk for the three months ended March 31, 2021 as compared with the consolidated financial statements for the year ended December 31, 2020. Please refer to Note 12(2) of the consolidated financial statements for the year ended December 31, 2020 for the related information.

(b) Foreign currency risk and sensitivity analysis (including consolidated elimination items and incompletely write-off of exchange rate risk)

March 31, 2021

				March 31, 2021	March 31, 2021
Financial assets Monetary items USD:NTD USD:HKD JPY:NTD Financial assets None monetary items	Foreign Currency 10,877 227 51,521	Exchange Rate 28.535 7.773 0.258	Carrying Value(NTD)	Sensitivity Analysis
				Variation Profit or Loss Impact	Equity Impact
			310,370 1,761 13,279	Increase 1% 3,104 Increase 1% 18 Increase 1% 133	- - -

－－ 43

49,718 63,265 16 1,322 Foreign Currency 8,811 227 85,253 48,908 62,231 1,776 Foreign Currency	216,173 275,071 70 37,716	Increase 1% - 2,162 Increase 1% - 2,751 Increase 1% (1) - Increase 1% (377) - December 31, 2020	Increase 1% - 2,162 Increase 1% - 2,751 Increase 1% (1) - Increase 1% (377) - December 31, 2020	Increase 1% - 2,162 Increase 1% - 2,751 Increase 1% (1) - Increase 1% (377) - December 31, 2020
	Carrying Value (NTD) 250,938 6,451 23,556 214,072 272,392 51,177	Sensitivity Analysis
		Variation	Profit and Loss Impact	Equity Impact

	Carrying Value(NTD)
6,852 227 49,296 60,816 4,147	207,092 6,847 209,753 258,774 125,356

－－ 44

When New Taiwan dollar appreciates and other variation factors stay unchanged, there will be the same but opposite amount of influence as of March 31, 2021, December 31, 2020 and March 31, 2020.

(c) Due to the exchange rate volatility, total exchange gains and losses (including realized and unrealized) from the Group’s monetary items amounted to $1,731 thousand and $5,161 thousand for the three months ended March 31, 2021 and 2020, respectively.

b. Price risk

The Group is exposed to equity instrument price risk because the investments held by the Group are classified on the consolidated balance sheet as fair value through other comprehensive income.

The Group mainly invest in domestic or foreign unlisted stocks. The price of such securities can be affected by changes in future value of those investment targets. If the price of the Group’s equity investments rises (or falls) 1%, the net income resulting from equity instruments at fair value through profit and loss will increase (or decrease) $1,737 thousand and $1,486 thousand for the three months ended March 31, 2021 and 2020, respectively.

c. Interest rate risk

The carrying amount of the financial assets and liabilities that exposed interest rate risk as reporting date was as follow:

	Carrying Amount
March 31, 2021	December 31, 2020	March 31, 2020
$ 64,181 (122,867)	$ 68,690 (124,238)	$ 15,633 (59,188)
$ (58,686)	$ (55,548)	$ (43,555)
$ 355,434 (1,001,790)	$ 393,772 (963,879)	$ 184,523 (616,000)
$ (646,356)	$ (570,107)	$ (431,477)

(a) Sensitivity analysis of fair value interest rate risk instrument

The Group does not classify any fixed-rate instruments as financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income. In addition, the Group does not designate derivatives (interest rate swap) as hedge instruments under hedge accounting. Therefore, the change of interest rate at reporting date does not have influence on net income and other comprehensive income.

－－ 45

(b) Sensitivity analysis of cash flow interest rate risk instrument
The Group’s financial instruments with variable interest rate are those with floating-rate. If interest rate increases 1%, the net income will increase $1,616 thousand and $1,079 thousand for the three months ended March 31, 2021 and 2020, respectively.

B. Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a contract leading to a financial loss to the Group. The Group is exposed to credit risk from operating activities, primarily accounts receivables, and from investing activities, primarily deposit and other financial instruments. Credit risk is managed separately for business related and financial related exposures.

a. Business related credit risk
In order to maintain the credit quality of accounts receivables, the Group has established procedures to monitor and limit exposure to credit risk on trade receivables. Credit evaluation is performed in the consideration of the relevant factors which may affects the customer's paying ability such as financial condition, external and internal credit scoring, historical experience, and economic conditions.
b. Financial credit risk

The Group's exposure to financial credit risk which pertained to bank deposits and other financial instruments were evaluated and monitored by Group Treasury function. The Group only deals with creditworthy counterparties, banks, and government so that no significant credit risk was identified. In addition, the Group has no financial assets at amortized and investments in debt instruments at fair value through other comprehensive income.

(a) Credit concentration risk:
As of March 31, 2021, December 31, 2020 and March 31, 2020, the Group's ten largest customers accounted for 57%, 67% and 56% of accounts receivable, respectively. The Group believes the concentration of credit risk is insignificant for the remaining accounts receivable. The Group continuously evaluated customers' financial situation. To reduce major credit risk, the Group bought credit guarantee insurance, and asked customers to make payment in advance.
(b) Measured in expected credit loss
(i) Account receivables apply the simplified approach. Please prefer to Note 6(3) for details.
(ii)Indications for determining whether the credit risk is increased significantly: None (the Group does not have any debt instrument investments that are

－－ 46

either measured at amortized cost, or at FVTOCI).

c. Collaterals and other credit enhancement held to avoid credit risks from financial assets.

The following table shows the maximum exposure to credit risk regarding financial assets recognized in the consolidated balance sheets, pledged collateral, master netting arrangements and other credit enhancement held by the Group:

Decrease Amount of Credit Risk Maximum	Decrease Amount of Credit Risk Maximum	Decrease Amount of Credit Risk Maximum	Exposure Total $ - - $ - Exposure
Collateral Net Settlement Agreement Other Credit Strengthening $ - $ - $ - - - - $ - $ - $ - Decrease Amount of Credit Risk Maximum Collateral Net Settlement Agreement Other Credit Strengthening $ - $ - $ - - - - $ - $ - $ - Decrease Amount of Credit Risk Maximum
			Total $ - - $ -
			Exposure
Collateral $ - - $ -	Net Settlement Agreement $ - - $ -	Other Credit Strengthening $ - - $ -	Total
			$ - -
			$ -

－－ 47

C. Liquidity risk

a. Liquidity risk management:

There were no significant changes in the Group's objects and policies for liquidity risk management for the three months ended March 31, 2021 as compared with the consolidated financial statements for the year ended December 31, 2020. Please refer to Note 12(2) of the consolidated financial statements for the year ended December 31, 2020 for the related information.

b. Financial liabilities with repayment periods:

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

Non-derivative Financial liabilities			March 31, 2021	March 31, 2021	March 31, 2021
	Within 6 months	7-12 months	1-2 years	2-5 years	Over 5 years	Contract Cash Flow	Carrying Value
Short-term loans Notes receivable Accounts payable Other payables Lease liabilities Long-term loans (Inclusive of current portion) Guarantee deposits Total	$ 290,000 16,192 503,998 494,065 2,327 - 3,102	$ - - - 44,532 2,090 127,560 -	$ - - - 14,500 3,029 130,338 5,112	$ - - - - 8,652 393,472 76	$ - - - - 119,818 60,420 -	$ 290,000 16,192 503,998 553,097 135,916 711,790 8,290	$ 290,000 16,192 503,998 553,097 122,867 711,790 8,290
	$ 1,309,684	$ 174,182	$ 152,979	$ 402,200	$ 180,238	$ 2,219,283	$ 2,206,234

Further information for lease liabilities with repayment periods was as follows:

Item Lease liabilities Non-derivative Financial liabilities	Within 1 year	1-5 years	5-10 years	10-15 years	10-15 years	15-20 years	15-20 years	Over 20 years	Undiscounted payments $ 135,916
	$ 4,417	$ 11,681	$ 13,006	$ 45,513		$ 46,481		$ 14,818
				December 31, 2020
	Within 6 months	7-12 months	1-2 years		2-5 years		Over 5 years	Contract Cash Flow	Carrying Value
Short-term loans Notes receivable Accounts payable Other payables Lease liabilities Long-term loans (Inclusive of current portion) Guarantee deposits Total	$290,000 27,992 459,049 527,534 2,801 3,780 1,546	$ - - - 44,700 2,132 123,780 1,556	$ - - - - 3,029 130,338 3,443		$ - - - - 9,089 415,981 1,669		$ - - - - 120,448 - -	$290,000 27,992 459,049 572,234 137,499 673,879 8,214	$290,000 27,992 459,049 572,234 124,238 673,879 8,214
	$1,312,702	$172,168	$136,810		$426,739		$120,448	$2,168,867	$2,155,606

－－ 48

Further information for lease liabilities with repayment periods was as follows:

Item Lease liabilities Non-derivative Financial liabilities	Within 1 year	1-5 years	5-10 years	10-15 years	10-15 years	15-20 years	15-20 years	Over 20 years	Undiscounted payments
	$4,933	$12,118	$11,449	$45,314		$48,331		$15,354	$137,499
				March 31, 2020
	Within 6 months	7-12 months $ - - - 65,732 3,037 3,600 - $ 72,369	1-2 years		2-5 years		Over 5 years	Contract Cash Flow	Carrying Value
Short-term loans Notes receivable Accounts payable Other payables Lease liabilities Long-term loans (Inclusive of current portion) Guarantee deposits Total	$ 516,000 34,225 503,183 390,978 2,351 3,600 3,166		$ - - - 10,500 4,714 7,200 1,556		$ - - - - 8,484 85,600 3,443		$ - - - - 49,612 - -	$ 516,000 34,225 503,183 467,210 68,198 100,000 8,165	$ 516,000 34,225 503,183 467,210 59,188 100,000 8,165
	$ 1,453,503		$ 23,970		$ 97,527		$ 49,612	$ 1,696,981	$ 1,687,971

Further information for lease liabilities with repayment periods was as follows:

Item Lease liabilities	Within 1 year	1-5 years $ 13,198	5-10 years	10-15 years	15-20 years	Over 20 years	Undiscounted payments $ 68,198
	$ 5,388		$ 11,607	$ 10,706	$ 10,705	$ 16,594

The Group does not expect a maturity analysis of which the cash flows timing would be significantly earlier, or the actual amount would be significantly different.

2. Categories of financial instruments

The carrying value of financial assets and liabilities of the Group as of March 31, 2021, December 31, 2020 and March 31, 2020 was as follows:

Financial assets	March 31, 2021	December 31, 2020	March 31, 2020
Financial assets measured at amortized cost Cash and cash equivalents Notes and accounts receivable (including related parties) Other receivables Other financial assets - current Refundable deposits Financial assets measured at FVTOCI Financial liabilities	$ 395,610 1,311,970 31,718 24,181 60,638 173,718 290,000 520,190	$ 443,889 1,265,071 26,401 18,681 60,615 180,345 290,000 487,041	$ 184,554 1,112,268 21,293 15,633 45,038 148,605 516,000 537,408
Financial liabilities measured at amortized cost Short-term loans Notes and accounts payable

－－ 49

(including related parties)
Other payables	553,097	572,234	467,210
Lease liabilities(including	122,867	124,238	59,188
current and noncurrent)
Long-term loans(including	711,790	673,879	100,000
current and noncurrent)
Guarantee deposits	8,290	8,214	8,165

(4) Fair value information
A. Details of the fair value of the Group’s financial assets and financial liabilities not measured at fair value are provided in Note 12(4) C. Details of the fair value of the Group's investment properties measured at cost are provided in Note 6(10).
B. The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:
- Level 1: Quoted prices in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Group’s investment in listed stocks, beneficiary certificates, on-the-run Taiwan central government bonds and derivative instruments with quoted market prices is included in Level 1.
- Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
- Level 3: Unobservable inputs for the asset or liability. The fair value of the Group's investments in some derivative instruments and equity instruments without active market is included in level 3.
C. Financial instruments that are not measured at fair value
- The Group considers that the carrying amounts of financial instruments including cash and cash equivalents, receivables, other financial assets, refundable deposits, short-term loans, payables, long-term loans and guarantee deposits that are not measured at fair value approximate their fair values.
D. The related information of fair value by level
- The related information of financial instruments measured at fair value on a recurring basis by level is as follows:

Item Assets: Recurring fair value Financial assets measured at FVTOCI		March 31, 2021	March 31, 2021
	Level 1	Level 2	Level 3	Total

－－ 50

Domestic unlisted stocks Foreign unlisted stocks Total Item Assets: Recurring fair value Financial assets measured at FVTOCI Domestic unlisted stocks Foreign unlisted stocks Total Item Assets: Recurring fair value Financial assets measured at FVTOCI Domestic unlisted stocks Foreign unlisted stocks Total	$ - - $ -	$ - - $ - December	$ 126,202 47,516 $ 173,718 31, 2020	$ 126,202 47,516 $ 173,718 Total $135,992 44,353 $180,345 Total $ 109,967 38,638 $ 148,605
	Level 1 $ - - $ -	Level 2 Level 3 $ - $135,992 - 44,353 $ - $180,345 March 31, 2020
	Level 1 $ - - $ -	Level 2 $ - - $ -	Level 3 $ 109,967 38,638 $ 148,605

E. Valuation techniques of financial instruments valued at fair value:
(a) The fair value of financial instruments with quoted prices in active markets held by the Group: None.
(b) Except for the above-mentioned financial instruments traded in an active market, the fair value is based on the valuation techniques or the quotation from the counterparty. The fair value refers to the current fair value of the other financial instruments with similar conditions and characteristics, using a discounted cash flow analysis or other valuation techniques, such as calculations of using models based on the information acquired from the market at the balance sheet date.

When the financial instrument of the Group is not traded in an active market, the fair value is determined based on the ratio of the quoted market price of the comparative company, its book value per share and its operating situation. Also, the fair value is discounted for its lack of liquidity in the market.

F. There was no transfer between Level 1 and Level 2 for the three months ended March 31, 2021 and 2020.

－－ 51

G. Changes in Level 3 instruments:

G. Changes in Level 3 instruments:
Item Beginning balance Recognized in other comprehensive income Ending balance	Investment in unquoted financial instruments
	ThreeMonthsEndedMarch31
	2021 $ 180,345 (6,627) $ 173,718	2020
		$ 175,468 (26,863)
		$ 148,605

H. Valuation process for Level 3 fair value measurement:
- Valuation process regarding fair value Level 3 is conducted by the Group’s finance department, by which the independence of fair value of financial instruments is verified though use of independent data source in order to make the valuation results close to market conditions. Such valuation results are regularly reviewed to ensure their reasonableness.
(5) Transfer of financial assets: None.
(6) Offset of financial assets and liabilities: None.
(7) Accounting items reclassification

For coordinating expression of financial statements for the three months ended March 31, 2021, some accounting items of the three months ended March 31, 2020 have been reclassified:

reclassified:
	Before		After
Item	reclassification	reclassification	reclassification
Operating cost	$ 1,380,575	$ 42,870	$ 1,423,445
Operating expense	147,172	(42,870)	104,302
General and administrative

13. SUPPLEMENTARY DISCLOSURES

A. Significant transactions information (before consolidation)
a. Loans provided to other parties: None
b. Endorsement/guarantee provided: Table 1
c. Marketable securities held: Table 2
d. Marketable securities acquired and disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital: None
e. Acquisition of individual real estate properties at costs of at least NT$300 million or 20% of the paid-in capital: Table 3
f. Disposal of individual real estate properties at prices of at least NT$300 million or 20% of the paid-in capital: None
g. Total purchases from or sales to related parties of at least NT$100 million or 20% of the paid-in capital: Table 4

－－ 52

h. Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital: None
i. Information about the derivative financial instruments transaction: None
j. The business relationship between the parent and the subsidiaries and significant transactions between them: Table 5
B. Information on investees (before consolidated elimination): Table 6
C. Information on investments in Mainland China (before consolidated elimination): Table 7
D. Information on major shareholders (including name of the shareholders with shareholding above 5%, shares held and shareholding ratio): Table 8

－－ 53

Table 1

SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES

ENDORSEMENTS/GUARANTEES PROVIDED

March 31, 2021

									(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)
No. (Note 1)	Endorsers	Endorsees		Endorsement Limit for a Single Entity (Note 3)	Highest Balance During the Period	Ending Balance	Actual Amount Drawn	Balance Secured by Collaterals	Ratio of Accumulated Amount to net Worth of the Company	Maximum Amount of Endorsement (Note 4)	Provision of Endorsements by Parent Company to Subsidiary	Provision of Endorsements by Subsidiary to Parent Company	Provision of Endorsements to the Party in Mainland China
		Name of endorsees	Relationship (Note 2)
`０`	Shiny Chemical Industrial Co., Ltd.	Unishine Chemical Corp.	6	6,133,259	241,080	241,080	203,458	`－`	3.93%	6,133,259	N	N	N
`０`	Shiny Chemical Industrial Co., Ltd.	E-Shine Advanced Chemical Co.,Ltd.	2	6,133,259	1,090,000	890,000	114,200	`－`	14.51%	6,133,259	Y	N	N

Note 1: The description of the number column is as follows:

(1) The issuer is represented in 0.
(2) The investee company is numbered sequentially from Arabic numeral 1.

Note 2: The following code represents the relationship with the Company :

Trading partner.
Majority owned subsidiary
The Company direct and indirect owns over 50% ownership of the investee company.
A subsidiary jointly owned over 90% by the Company.
Guaranteed by the Company according to the construction contract.
An investee company. The guarantees were provided based on the Company's proportionate share in the investee company.
Joint and several guaranteed by the Company according to the pre-construction contract under Consumer protection Act.
Note 3: Endorsements/guarantees provided by the Company to a single enterprise shall not exceed 100% of the Company’s net worth, respectively. Note 4: The maximum amount of the endorsements/guarantees provided by the Company shall not exceed 100% of the Company’s net worth.

－－ 54

Table 2

SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES

MARKETABLE SECURITIES HELD

March 31, 2021

				(Amounts in Thousands of New Taiwan Dollars)	(Amounts in Thousands of New Taiwan Dollars)	(Amounts in Thousands of New Taiwan Dollars)	(Amounts in Thousands of New Taiwan Dollars)	(Amounts in Thousands of New Taiwan Dollars)
Investor	Type and Name of Securities	Relationship with the Issuer	General Ledger Account	Endingbalance				Remarks
				Number of Shares (in thousands)	Carrying Value	Percentage of Ownership	Fair Value
Shiny Chemical Industrial Co., Ltd.	Share/SEPANGAR CHEMICAL INDUSTRY SDN BHD.	The key management of the Company	Financial assets at fair value through other comprehensive income or loss - noncurrent	3,800	47,516	19.00%	47,516
Shiny Chemical Industrial Co., Ltd.	Share/AZOTEK CO., LTD.	The key management of the Company	Financial assets at fair value through other comprehensive income or loss - noncurrent	8,017	125,472	13.36%	125,472
Shiny Chemical Industrial Co., Ltd.	Share/LINKOU INTERNATIONAL GOLF & COUNTRY CLUB	None	Financial assets at fair value through other comprehensive income or loss - noncurrent	-	730	0.10%	730
		Total			173,718		173,718

－－ 55

Table 3

SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES

Acquisition of individual Real Estate Properties at Costs of At Least NT$300 Million or 20% of the Paid-in Capital Three months Ended March 31, 2021

		(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)
	Relationship ith th	Prior transaction of related counterparty	Pi Rf Purpose of Other

							(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)	(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)
Company Name	Real Estate	Transaction Date	Transaction Amount	Payment Term	Counterparty	Relationship ith th	Prior transaction of related counterparty				Pi Rf	Purpose of	Other
						w e Seller	Owner	Relationship	Transfer Date	Amount	rce eerence	Acquisition	Terms
Shiny Chemical Industrial Co., Ltd.	Buildings	November 13, 2019 to March 31, 2021	NTD 422,241	NTD 352,375	JTE CHI CORPORATION, HSIEN-WUANG MECHANICAL INDUSTRI CO., LTD., SHENG SHYANG MECHANICAL ENGINEERING CO., LTD, etc.	None	－	－	－	－	Determined at prices agreed by both parties upon negotiation or through price comparison .	Increase production capacity.	－

－－ 56

Table 4

SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES OF AT LEAST

NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL

March 31, 2021

							(Amounts in	(Amounts in	Thousands of New Taiwan Dollars)	Thousands of New Taiwan Dollars)	Thousands of New Taiwan Dollars)
Company Name Related Party		Nature of Relationships		Transaction	Details		Abnormal Transaction		(Notes/Accounts Payable) Or Receivable		Remarks
			Purchases/ Sales	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
Shiny Chemical Industrial Co.,Ltd.	E-Shine Advanced Chemical Co.,Ltd.	Subsidiary	Purchases	88,091	6.51%	3 months	Equivalent to ordinary suppliers.	3 months	(34,637)	6.66%
			Outsourcing processingfee	46,019	100.00%

Note: Transactions between the parent company and subsidiaries have been written off.

－－ 57

Table 5

SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES

INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT INTERCOMPANY TRANSACTIONS

March 31, 2021

(Amounts in Thousands of New Taiwan Dollars)

No. (Note 1)	Company Name	Counterparty	Nature of Relationship (Note 2)	Intercompany Transactions	Intercompany Transactions	Intercompany Transactions
				Account	Amount	Terms (Note 4)	Percentage of Consolidated Net Revenue or Total Assets(Note 3)
0	Shiny Chemical Industrial Co., Ltd.	E-Shine Advanced Chemical Co., Ltd..	1	Sales revenues (Including rental revenue)	21,272	Selling price was the same with general customers. Payment terms were within 3 months. Both parties can agree to postpone the payment.	0.92%
				Accounts receivable	9,054		0.10%
				Other account receivables	13,867		0.16%
1	E-Shine Advanced Chemical Co., Ltd..	Shiny Chemical Industrial Co., Ltd.	2	Sales revenues	134,110	Selling price was the same with general customers. Payment terms were within 3 months. Both parties can agree to postpone the payment.	5.85%
				Accounts receivable	51,516		0.59%
				Other account receivables	2,713		0.03%
				Right-of-use asset	86,950		0.99%

Note 1: The numbers filled in for the transaction company in respect of inter-company transactions are as follows:

(1) Parent company is ‘0’.
(2) The subsidiaries are numbered in order starting from ‘1’.
Note 2: Relationship between transaction company and counterparty is classified into the following three categories:
(1) Parent company to subsidiary.
(2) Subsidiary to parent company.
(3) Subsidiary to subsidiary.
Note 3: Regarding percentage of transaction amount to consolidated total operating revenues or total assets, it is computed based on period-end balance of transaction to consolidated total assets for balance sheet accounts and based on accumulated transaction amount for the period to consolidated total operating revenues for income statement accounts.

Note 4: Transactions between the aforesaid subsidiaries and the parent company have been written off.

－－ 58

Table 6

SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES

NAMES, LOCATIONS AND OTHER INFORMATION OF INVESTEE COMPANIES (EXCLUDING INVESTEE IN MAINLAND)

March 31, 2021

(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)

Investor Company	Investee Company	Location	Main Businesses and Products	Original Investment Amount	Original Investment Amount	Balance as of March 31,2020	Balance as of March 31,2020	Balance as of March 31,2020	Net Income (Loss) of the Investee	Share of Profit/Loss of Investee
				As of March 31, 2021	As of December 31, 2020	Shares (In Thousands)	Percentage of Ownership	Carrying Value
Shiny Chemical Industrial Co., Ltd.	Unishine Chemical Corp.	Taipei City	Warehousing	59,980	59,980	28,491	49.98%	404,773	12,497	6,246
	Elsom Development Ltd.	Hong Kong	Investments & trading	162,451 (USD 5,047)	162,451 (USD 5,047)	39,244	100.00%	292,432 (HKD79,660)	4,340 (HKD 1,182)	4,340 (HKD 1,182)
	Spring World Holdings Ltd.	British Virgin Islands	Investments & trading	147,227 (USD 4,450)	147,227 (USD 4,450)	4,450	100.00%	216,211 (USD 7,577)	3,533 (USD 124)	3,533 (USD 124)
	E-Shine Advanced Chemical Co., Ltd.	Changhua County	Chemical	75,000	75,000	30,000	100.00%	954,894	53,524	57,583
	Transsom Technology Co., Ltd.	Taipei City	Manufacturing of synthetic resin and plasticproduct.	860	860	100	100.00%	855	-	-
Elsom Development Ltd.	Shanghai Liansheng ChemistryCo., Ltd.	China	Chemical	69,408 (USD 2,166)	69,408 (USD 2,166)	`－`	35.00%	100,045 (HKD 27,253)	6,503 (HKD 1,771)	2,276 (HKD 620)
	Shanghai Haosheng Chemical Technology Co.,Ltd.	China	Chemical	145,014 (USD 4,543)	145,014 (USD 4,543)	`－`	35.00%	175,026 (HKD 47,678)	6,382 (HKD 1,738)	2,234 (HKD 608)
Spring World Holdings Ltd.	Zhangjiagang Trans-Ocean Enterprise Co.,Ltd.	China	Chemical	156,162 (USD 4,740)	156,162 (USD 4,740)	`－`	18.50%	216,173 (USD 7,575)	19,100 (USD 670)	3,533 (USD 124)

Note : Transactions between the parent company and subsidiaries have been written off.

－－ 59

Table 7

SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES

INFORMATION ON INVESTMENT IN MAINLAND CHINA

March 31, 2021

`(1)` Mainland Investment Information:

`(1)`Mainland I	`(1)`Mainland I	nvestment Inf	ormation:	ormation:	ormation:
									(Amounts in Thousands of New Taiwan Dollars and Foreign Currencies)
Investee Company		Main Businesses and Products	Total Amount of Paid-in Capital	Method of Investment (Note 1)		Accumulated Outflow of Investment from Taiwan as of January 1, 2021	Investment Flows		Accumulated Outflow of Investment from Taiwan as of March 31, 2021	Net Income (Loss) of the Investee Company	Percentage of Ownership	Share of Profit/Loss (Note 2)	Carrying Amount as of March 31, 2021	Accumulated Inward Remittance of Earnings as of March 31, 2021
							Outflow	Inflow
Shanghai Liansheng Chemistry Co., Ltd.		Chemical	NTD 242,250 (RMB 50,000) (Note 4)		(2)	NTD 64,844 (USD 2,029)	`－`	`－`	NTD 64,844 (USD 2,029)	NTD 6,503 (HKD 1,771)	35.00%	NTD 2,276 (HKD 620) (2).C	NTD 100,045 (HKD 27,253)	NTD 90,247
Shanghai Haosheng Chemical Technology Co., Ltd.		Chemical	NTD 436,050 (RMB 90,000)		(2)	NTD 97,607 (USD 3,018)	`－`	`－`	NTD 97,607 (USD 3,018)	NTD 6,382 (HKD 1,738)	35.00%	NTD 2,234 (HKD 608) (2).C	NTD 175,026 (HKD 47,678)	`－`
Zhangjiagang Trans-Ocean Enterprise Co., Ltd.		Chemical	NTD 1,031,985 (RMB 213,000) (Note 5)		(2)	NTD 147,227 (USD 4,450)	`－`	`－`	NTD 147,227 (USD 4,450)	NTD 19,100 (USD 670)	18.50%	NTD 3,533 (USD 124) (2).C	NTD 216,173 (USD 7,575)	NTD 146,638

	Accumulated Investment in Mainland China as of March 31, 2021				Investment Amounts Authorized by Investment Commission, MOEA				Upper Limit on Investment
	309,678 (USD 9,497)				377,176 (USD 13,218)				3,679,954

－－ 60

Note 1: The investment methods are divided into the following three types:

(1) Investing directly to the Mainland China;
(2) Reinvesting in the Mainland China through third-region companies (please refer to Table 6);
(3) Others.
Note 2: In the current period, the investment profit and loss column are recognized:
(1) If during incorporation with no investment income or loss, it should be indicated;
(2) The basis for recognition of investment gains and losses divided into the following three types, which should be indicated:
A. Audited financial statements by international accounting firms with cooperation relationship with accounting firms in the Republic of China.
B. Audited financial statements by parent company’s auditors.
C. Others.
Note 3: The relevant figures in this form should be listed in New Taiwan Dollars.
Note 4 : Including capitalization of retained earning RMB 8,760 thousand.
Note 5 : Including capitalization of retained earning RMB 13,189 thousand.
Note 6 : The figures in the Table shall be expressed in New Taiwan Dollars. Carrying amount at the end of the period is converted using the exchange rate on the reporting date (USD:NTD 1: 28.535; HKD: NTD 1: 3.6710). Investment gain or loss recognized in the current period is converted using the average exchange rate in from January 1 to March 31, 2021 (USD: NTD 1: 28.5075; HKD: NTD 1: 3.6720)
(2)The Company’s major transactions during the three months ended Marchs 31, 2021 directly or indirectly through the third place and the mainland invested company are listed as follows: None.

－－ 61

Table 8

SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES

INFORMATION ON MAJOR SHAREHOLDERS

March 31, 2021

	March 31, 2021	March 31, 2021
	(Unit: share)
Shares Name of Major Shareholder	Number of Shares	Percentage of Ownership (%)
NINGHAN DEVELOPMENT CO., LTD.	55,133,548	30.62%
YU KUO PLYWOOD CORP.	22,355,534	12.41%

Note: The information of major shareholders is based on the number of ordinary shares and preferred shares held by shareholders with ownership of 5% or greater, that have been issued without physical registration (included treasury shares) by the Company. The share capital in consolidated financial report may differ from the actual number of shares that have been issued without physical registration because of different preparation basis.

－－ 62

14.SEGMENT INFORMATION

(1) General information

For management purpose, the Group’s reportable segments are listed as follows:

A. Yeong An plant: Mainly engaging in manufacturing, processing and trading chemical solvents.
B. Changhua Coastal plant: Mainly engaging in manufacturing, processing and trading chemical solvents.
C. Others: Mainly engaging in investment.
(2) Measurement basis

The Group uses profit before income tax as the measurement for segment profit and the basis of performance assessment. There was no material inconsistency between the accounting policies of the operating segment and the accounting policies described in Note 4.

(3) Segment financial information

					(In thousands)
Three months Ended		Changhua
March 31,2021	YeongAnplan	Coastalplant Others		Elimination	Total
Sales from external customers	$ 2,065,256	$ 228,546 $	-	$ -	$ 2,293,802
Sales among inter-segment	21,274	134,108	-	(155,382)	-
Total sales	$ 2,086,530	$ 362,654 $	-	$ (155,382)	$ 2,293,802
Depreciation and Amortization	$ 61,564	$ 15,942 $	-	$ (2,805)	$ 74,701
Segment operating profit (loss)	$ 456,775	$ 67,410 $ 7,873		$ (60,720)	$ 471,338
Investments	$ 1,869,166	$ - $ 491,244		$ (1,464,393)	$ 896,017
accounted for using
equity method
Noncurrent capital expenditure	$ 254,179	$ 78,738 $	-	$ -	$ 332,917
Segment assets	$ 8,384,481	$ 1,483,172 $ 509,546		$ (1,673,897)	$ 8,703,302
Segment liabilities	$ 2,217,872	$ 490,130 $	48	$ (165,403)	$ 2,542,647

a. Total reporting segment sales should eliminate inter-segment sales of $155,382 thousand.
、
b. Interest revenue of $72 thousand interest expense of ($450) thousand and income tax expense of ($92,965) thousand is not included in segment profit (loss).
c. Segment assets did not include deferred income tax assets $67,179 thousand.
d. Segment liabilities did not include deferred income tax liabilities $62,741 thousand and net defined benefit liabilities $31,834 thousand.

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(In thousands)

			(In thousands)
Three months Ended		Changhua
March31,2020	YeongAnplan	Coastalplant Others	Elimination Total
Sales from external	$ 1,789,444	$ 188,926 $	- $ - $ 1,978,370
customers
Sales among	25,476	139,934	- (165,410) -
inter-segment
Total sales	$ 1,814,920	$ 328,860 $	- $ (165,410) $ 1,978,370
Depreciation and	$ 60,632	$ 15,793 $	- $ (2,805) $ 73,620
Amortization
Segment operating	$ 326,948	$ 68,947 $ 4,088 $ (59,498) $ 340,485
profit (loss)
Investments	$ 1,713,575	$ - $ 468,527 $ (1,302,912) $ 879,190
accounted for using
equity method
Noncurrent capital	$ 167,784	$ 23,711 $	- $ - $ 191,495
expenditure
Segment assets	$ 6,886,765	$ 1,217,167 $ 495,633 $ (1,504,033) $ 7,095,532
Segment liabilities	$ 1,690,837	$ 385,215 $	58 $ (172,773) $ 1,903,337

a. Total reporting segment sales should eliminate inter-segment sales of $165,410 thousand.
、
b. Interest revenue of $34 thousand interest expense of ($1,677) thousand and income tax expense of ($67,344) thousand is not included in segment profit (loss).
c. Segment assets did not include deferred income tax assets $58,831 thousand.
d. Segment liabilities did not include deferred income tax liabilities $60,370 thousand and net defined benefit liabilities $34,439 thousand.
(4) Production information: No disclosure requirement for interim financial statements.
(5) Geographic information: No disclosure requirement for interim financial statements.
(6) Major customer information: No disclosure requirement for interim financial statements.

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SHINY CHEMICAL — Interim / Quarterly Report 2021

51918_rns_2021-10-29_2c550fd6-4299-43ea-bf4b-96f54fb1e473.pdf

SHINY CHEMICAL INDUSTRY CO., LTD.

AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED MARCH 31, 2021 AND 2020

AND

INDEPENDENT AUDITORS’ REVIEW REPORT

CONTENTS

INDEPENDENT AUDITORS’ REVIEW REPORT

Introduction

Scope of Review

Basis for Qualified Conclusion

Qualified Conclusion

Notice to Readers

SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

SHINY CHEMICAL INDUSTRIAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Reviewed, Not Audited)

SHINY CHEMICAL INDUSTRY CO., LTD. AND SUBSIDIARIES

1. GENERAL INFORMATION

2. THE AUTHORIZATION OF FINANCIAL STATEMENTS

3. APPLICATION OF NEW AND AMENDED STANDARDS AND INTERPRETATIONS

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(1) Compliance statement

(2) Basis of preparation

(3) Basis of consolidation

B. The consolidated entities were as follows:

(5) Retirement benefits

5. CRITICAL ACCOUNTING JUDGMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTION UNCERTAINTY

6. CONTENTS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

(2) Notes receivable, net

(3) Accounts receivable, net

(4) Inventories and operating costs

(5) Other financial assets - current

(6) Financial assets at fair value through other comprehensive income or loss - noncurrent

(7) Investments accounted for using equity method

(1) Significant associates of the Group were as follows:

(8) Property, plant and equipment

(9) Lease agreement

B. Lease liabilities

D. Subleasing: None.

(10) Investment properties, net

(11) Intangible assets

(12) Short-term loans

(14) Provisions - current

(15) Long-term loans

(16) Pension

B. Defined benefit plans

(17) Share capital

(18) Capital surplus

(19) Retained earnings and dividend policy

(20) Other equity

(21) Operating revenues

A. Explain of contract revenue

B. Other operating revenue

(1) Segmented by revenue from different types:

Three months ended March 31, 2020：

D. Contract balances

(Note) Including notes receivable and accounts receivable.

(22) Labor cost, depreciation and amortization

(23)Interest income

(24) Other income

(25) Other gains and losses

Three Months Ended March 31

(26) Finance costs

(27) Income tax

(28) Other comprehensive income (loss)

(29) Earnings per share

7. RELATED PARTY TRANSACTIONS

Three Months Ended March 31

Three Months Ended March 31

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT

COMMITMENTS

10. SIGNIFICANT DISASTER LOSS: NONE.

11. SIGNIFICANT SUBSEQUENT EVENTS: NONE.

12. OTHERS

Financial risk management policies

b. Price risk

SHINY CHEMICAL Interim / Quarterly Report 2021

`(1)` Mainland Investment Information: