Consolidated Financial Statements Second Quarter

RECHI PRECISION CO., LTD. and its

subsidiaries

Consolidated Financial Statements for the Six Months Ended June 30, 2025 and 2024 and Independent Auditors' Review Report

Address: No. 943, Sec. 2, Chenggong Rd., Guanyin Dist., Taoyuan City, Taiwan (R.O.C.)

TEL: (03)483-7201

§Table of Contents§

Items Page

Notes to financial the statements No.

To RECHI PRECISION CO., LTD.:

We have reviewed the accompanying consolidated balance sheet of RECHI PRECISION CO., LTD. (the "Company") and subsidiary (collectively, the "Group") as of June 30, 2025 and 2024, and the related consolidated statement of income for the three months ended June 30, 2025 and 2024 and for the six months ended June 30, 2025 and 2024, consolidated statement of changes in equity, consolidated statement of cash flows for the six months then ended, and notes to the consolidated financial statements (including major accounting policy) for the three months then ended. Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulation Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Statement 34 "Interim Financial Reporting" endorsed and issued into effect by the Financial Supervisory Commission. Our responsibility is to express a conclusion on the consolidated financial statements based on our reviews.

Except for those described in the paragraph of basis of a qualified conclusion, we conducted the review in accordance with the "Review of Financial Statements" of the Auditing Standard No. 2410. 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 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.

As stated in Note 11 to the consolidated financial statements, the financial statements of some non-significant subsidiaries included in the accompanying consolidated financial statements were not reviewed by independent auditors. The total assets of these non-significant subsidiaries amounted to NTD 3,170,674 thousand and NTD 3,426,027 thousand, constituting 11.50% and 12.02% of the consolidated total assets, and the total liabilities of these non-significant subsidiaries amounted to NTD 1,201,048 thousand and NTD 1,786,685 thousand, constituting 6.87% and 10.28% of the consolidated total liabilities, as of June 30, 2025 and 2024, respectively. The total comprehensive income of these non-significant subsidiaries and joint operations amounted to NTD 46,233 thousand, NTD 38,486 thousand, NTD 98,604 thousand and NTD 83,776 thousand,

constituting (3.86)%, 8.50%, (15.39)%, and 7.23% of the consolidated total comprehensive income for the three months ended June 30, 2025 and 2024 and for the six months ended June 30, 2025 and 2024. In addition, as stated in Note 12 to the Consolidated Financial Statements, the investments accounted for using the equity method amounted to NTD 190,723 thousand and NTD

173,551 thousand as of June 30, 2025 and 2024, respectively; and the shares of profit/loss on associates accounted for using the equity method amounted to NTD (2,430) thousand, NTD (614) thousand, NTD (4,483) thousand and NTD (1,393) thousand for the three months ended June 30, 2025 and 2024, and for the six months ended June 30, 2025 and 2024, respectively. These amounts and relevant information disclosed in Note 30 to the Consolidated Financial Statements were based on the financial statements of these investees for the same period that were not reviewed by independent auditors.

Based on our reviews, except for the adjustments, if any, as might have been determined to be necessary had the financial statements of the non-significant subsidiaries and associates as described in the preceding paragraph been reviewed, nothing has come to our attention that caused 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 June 30, 2025 and 2024, and its consolidated financial performance for the three months June 30, 2025 and 2024, and its consolidated financial performance and its consolidated cash flows for the six months ended June 30, 2025 and 2024 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and International Accounting Standard 34 "Interim Financial Reporting" endorsed and issued into effect by the Financial Supervisory Commission.

Deloitte & Touche

CPA CHANG, CHING Hsia CPA CHENG, CHIN TSUNG

Financial Supervisory Commission Approval Document No.

Chin-Kuan-Cheng-Shen-Zi No. 1090347472

Financial Supervisory Commission Approval Document No.

Chin-Kuan-Cheng-Shen-Zi No. 1010028123

August 12, 2025

RECHI PRECISION CO., LTD. and its subsidiaries Consolidated Balance Sheet

As of June 30, 2025, December 31, 2024, and June 30, 2024

Unit: NTD thousand

June 30, 2025 December 31, 2024 June 30, 2024

The notes attached shall constitute an integral part of this Consolidated financial statement. (Please refer to the review report by Deloitte & Touche dated August 12, 2025)

Chairman: CHEN, SHENG TIEN Manager: FENG, MING FA Accounting Manager: WU, CHIN MEI

RECHI PRECISION CO., LTD. and its subsidiaries Consolidated Statements of Comprehensive Income

For the Three months Ended June 30, 2025 and 2024 and For the Six Months Ended June 30, 2025 and 2024

Unit: NTD thousand, except Earnings Per Share (NTD)

April 1 to June 30, 2025 April 1 to June 30, 2024 January 1 to June 30, 2025 January 1 to June 30, 2024

Earnings per share (Note 22)

Business units in continuing operation

The notes attached shall constitute an integral part of this Consolidated financial statement. (Please refer to the review report by Deloitte & Touche dated August 12, 2025)

Chairman: CHEN, SHENG TIEN Manager: FENG, MING FA Accounting Manager: WU, CHIN MEI

RECHI PRECISION CO., LTD. and its subsidiaries Consolidated Statements of Changes in Equity

For the Six Months Ended June 30, 2025 and 2024

Equity of the company

Other equity

Unit: NTD thousand

Share capital Retained earnings

Exchange differences from the translation of financial

Unrealized gain on financial assets at fair value through other

Code

Shares (in

thousand shares) Amount Capital reserves

Statutory surplus

reserves

Special surplus

reserves

Undistributed

earnings

statements of

foreign operations

comprehensive

income or loss

Treasury shares Total

Non-controlling

interests Total equity

A1 Balance as of January 1, 2024 504,915 $ 5,049,151 $ 1,355,324 $ 1,156,333 $ 928,988 $ 2,340,079 ( $ 1,025,598 ) ( $ 71,810 ) ( $ 93,573 ) $ 9,638,894 $ 1,162,197 $ 10,801,091

The notes attached shall constitute an integral part of this Consolidated financial statement. (Please refer to the review report by Deloitte & Touche dated August 12, 2025)

Chairman: CHEN, SHENG TIEN Manager: FENG, MING FA Accounting Manager: WU, CHIN MEI

- 7 -

RECHI PRECISION CO., LTD. and its subsidiaries Consolidated Statements of Cash Flows

For the Six Months Ended June 30, 2025 and 2024

Unit: NTD thousand

Code

Cash flow from operating activities

January 1 to June 30,

2025

January 1 to June 30,

2024

A24100 Unrealized foreign currency exchange

A31115 Increase in financial assets mandatorily

(Continued on next page)

The notes attached shall constitute an integral part of this Consolidated financial statement. (Please refer to the review report by Deloitte & Touche dated August 12, 2025)

Chairman: CHEN, SHENG TIEN Manager: FENG, MING FA Accounting Manager: WU, CHIN MEI

RECHI PRECISION CO., LTD. and its subsidiaries Notes to Consolidated Financial Statements

For the Six Months Ended June 30, 2025 and 2024 (Unless otherwise provided, Unit: NTD thousand)

1. Organization and operations

   RECHI PRECISION CO., LTD. (formerly known as RECHI INDUSTRIAL CO., LTD.,

   hereinafter referred to as the Company) was established in December 1989 in accordance with the Company Act of the Republic of China, mainly engaged in the assembly and processing, manufacturing and repairing, and trading of refrigerant compressors, and design services of relevant products, as well as import and export business.

   The Company's shares had been listed for trading on the Taipei Exchange since February 2002, and have changed to be listed on the Taiwan Stock Exchange since August 2003.

   The consolidated financial statements are presented in the Company's functional currency - New Taiwan dollars.

2. Financial reporting date and procedures

   The consolidated financial statements were approved by the board of directors and authorized for issue on August 12, 2025.

3. Application of new and revised standards and interpretation

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

      Amendments to IAS 21 "Lack of Exchangeability"

      The application of the amendments to the AS 21 "Lack of Exchangeability" does not have material impact on the Group's accounting policies:

   2. The IFRSs endorsed by the FSC for application starting from 2026

      The new/amended/revised standards or interpretation Effective Date per IASB

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

      Amendments to IFRS 9 and IFRS 7 "Contracts Referencing Nature-dependent Electricity"

      January 1, 2026

      January 1, 2026

      "IFRS Annual Improvements - Volume 11" January 1, 2026

      IFRS 17 "Insurance Contracts" January 1, 2023

      Amendments to IFRS 17 January 1, 2023

      Amendments to IFRS 17 "Initial Application of IFRS 17 and IFRS 9 - Comparative Information"

      January 1, 2023

      The Group will continue to evaluate the effect of the amendment on its financial position and performance up to the date when this consolidated company financial statement approved and released. The Group will make appropriate disclosures upon completing this evaluation.

   3. The IFRSs released by the IASB but not yet approved and announced effective by the Financial Supervisory Commission

      The new/amended/revised standards or interpretation Amendment to IFRS 10 and IAS 28, "Sale or

      Contribution of Assets between an Investor and its Associate or Joint Venture and Investment in Associates."

      IFRS 18 "Presentation and Disclosure in Financial Statements"

      IFRS 19 "Subsidiaries without Public Accountability: Disclosures"

      IASB publication effective

      date (Note) To be determined

      January 1, 2027

      January 1, 2027

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

      IFRS 18 "Presentation and Disclosure in Financial Statements"

      IFRS 18 will supersede IAS 1 "Presentation of Financial Statements" and the main changes include:

      • Items of income and expenses included in the income statement shall be classified into operating, investing, financing, income tax, and discontinued operations categories.

      • The income statement shall present operating profit or loss, profit or loss before financing and income tax, as well as subtotal and total profit and loss.

      • Provides guidance to enhance the requirements of aggregation and disaggregation: The Group shall identify the assets, liabilities, equity, income, expenses, and cash flows that arise from individual transactions or other events and classify and aggregate them into groups based on shared characteristics, so as to result in the presentation in the primary financial statements of line items that have at least one similar characteristic. Items with non-similarity characteristics in the main financial statements and notes should be divided. The Group only marks "other" in the absence of more information.

      • Adds disclosures on management-defined performance measures: When in public communications outside financial statements and communicating to users of financial statements management's view of an aspect of the financial performance of the Group as a whole, the Group shall disclose related information about its management-defined performance measures in a single note to the financial statements, including the description of such measures, calculations, reconciliations to the subtotal or total specified by IFRS Accounting Standards, and the income tax and non-controlling interests effects of related reconciliation items.

      In addition to the aforementioned influence, the Group will continue to evaluate the effect of the amendment to each standard and interpretation on its financial position and performance up to the date when this consolidated company financial statement approved and released. The Group will make appropriate disclosures upon completing this evaluation.

4. Summary of significant accounting policies

   1. Compliance Statement

      The consolidated financial statements are prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IAS 34 "Interim Financial Reporting" indorsed and issued into effect by the FSC. The consolidated financial statements do not include all IFRSs disclosures required for the full-year financial statements.

   2. Basis of preparation

      Except for the financial instruments on the basis of fair value and the recognition of net defined benefit liabilities on the basis of the present value of net defined benefit obligation net of the fair value of planned assets, this consolidated financial statement was compiled on the basis of historical cost.

      The evaluation of fair value could be classified into Level 1 to Level 3 by the observable intensity and importance of related input value:

      1. Level 1 input value: refers to the quotation of the same asset or liability in an active market as of the evaluation (before adjustment).

      2. Level 2 input value: refers to the direct (the price) or indirect (inference of price) observable input value of asset or liability further to the quotation of Level 1.

      3. Level 3 input value: the unobservable input value of asset or liability.

   3. Basis of consolidation

      This consolidated financial statement contains the information of the financial statements of the Bank and its controlled entities (subsidiaries). The Consolidated Statement of Comprehensive Income already covered the operating profit and/or loss of the subsidiaries, which have been acquired or disposed of the current term, from the date of acquisition until the date of disposal. The subsidiaries' financial statements have been properly adjusted to keep the accounting policies consistent with the accounting policies of the Group. In preparing these consolidated financial statements, the transactions, account balances, incomes and loss and expenses among the individual entities are written off in full amount. The total comprehensive incomes of the subsidiaries were non-controlling interest attributed to the Company's owners and the non-controlling interest, to become the balance of loss even as the non-controlling interest.

      When the changes of interest of the subsidiaries' ownership by the Group do not lead to the loss of control, it is disposed of as interest transactions. The book value of the Group and non-controlling interest has been adjusted to reflect the changes of the relative interest of subsidiaries. The differential between the adjustment amount of non-controlling interest and the fair value of consideration received is directly recognized as interest and belongs to the owner of the Company.

      For details of subsidiaries, shareholding ratios, and business items, please refer to Note 11 and Table 7.

   4. Other significant accounting policies

      In addition to the information below, please refer to the summary of significant accounting policies in the 2024 consolidated financial statements.

      1. Defined benefits and retirement benefits

         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 fiscal year, adjusted for significant market fluctuations since that time and significant plan amendments, settlements, or other significant one-off events.

      2. Income tax expenses

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

5. Main source of significant accounting judgment, estimates and assumptions uncertainty Please refer to the 2024 consolidated financial statements for descriptions of the main

   source of significant accounting judgment, estimates, and assumptions uncertainty.

6. Cash and cash equivalents

   June 30, 2025

   December 31,

   2024 June 30, 2024

   Cash on hand and working
   capital	$ 1,681	$ 1,542	$ 1,404
   Bank checks and demand
   deposits	2,448,415	3,801,498	1,692,719
   Cash equivalents (Investment with the original maturity date
   within three months)
   Bank time deposit	1,000,560	2,036,099	1,505,252
   	$ 3,450,656	$ 5,839,139	$ 3,199,375

7. Financial instruments measured at fair value through profit or loss

   December 31,

   Financial assets - current Mandatorily measured at FVTPL

   Wealth management

   June 30, 2025

   2024 June 30, 2024

   products $ 1,941,064 $ 1,805,772 $ 1,836,292

   Non-derivative financial assets

   • Listed stocks -

     overseas - 4,135 3,752

   • Beneficial

   certificates 14,854 16,879 20,289

   $ 1,955,918 $ 1,826,786 $ 1,860,333

8. Financial assets at amortized cost

   Current

   June 30, 2025

   December 31,

   2024 June 30, 2024

   Restricted cash in banks $ 3,604,700 $ 3,450,581 $ 3,646,839 Time deposits with original

   maturity date of more than 3

   months 399,403 364,866 136,596

   $ 4,004,103 $ 3,815,447 $ 3,783,435

   For details of financial assets at amortized cost, refer to Note 27.

9. Note receivable and account receivable

Notes receivable

Measured on the basis of cost after amortization

June 30, 2025

December 31,

2024 June 30, 2024

Accounts receivable Measured on the basis of cost

after amortization

The Group's average credit period for sales open account with net 0 days to 285 days, and no interest is accrued on accounts receivable.

In order to mitigate the credit risk, the Group has formulated credit management measures to regulate the determination of credit limits, credit approval, and other monitoring procedures to ensure that appropriate actions have been taken in the recovery of overdue receivables. In addition, the Group will review the recoverable amount of receivables on each balance sheet date to ensure that appropriate impairment loss has been appropriated for the uncollectible receivables. Under the circumstance, the Company's management believes that the consolidated company's credit risk is significantly reduced.

The Group will recognize the lifetime expected credit losses as loss allowance for accounts receivable. The full lifetime expected credit losses are calculated using Provision Matrix, which considers the historical default records and current financial status, industry economic conditions, as well as GDP forecast and industry outlook. Because of the different loss patterns of customer groups in different regions of the Group, the Group uses different provisions matrices for different customer groups by location, and determines the expected credit loss rate by taking into account the number of past due days of accounts receivable and the regional economic situation.

If there is evidence that the counterparty is facing serious financial difficulties and the Group cannot reasonably expect to recover the amount, e.g. the counterparty is in liquidation, then the Group directly writes off the relevant accounts receivable, but will continue to try to collect the receivable. The recovered amount is recognized in profit or loss.

The Group's allowance for loss of receivables is determined according to the preparation matrix as follows:

June 30, 2025

Overdue 1 to 30

Overdue for 31 to

Overdue 61 to 90

Overdue 91 to

Overdue over 121

Not overdue days 60 days days 120 days days Total

Expected credit loss

December 31, 2024

Overdue 1 to 30 Overdue for 31 to Overdue 61 to 90 Overdue 91 to Overdue over 121

Not overdue days 60 days days 120 days days Total

Expected credit loss

rate 0%～0.16% 0.52%～13.74% 5.84%～45.96% 17.76%～59.91% 22.63%～84.41% 33.08%～100%

June 30, 2024

Overdue 1 to 30

Overdue for 31 to

Overdue 61 to 90

Overdue 91 to

Overdue over 121

Not overdue days 60 days days 120 days days Total

Expected credit loss

rate 0%～0.16% 0.52%～13.74% 5.84%～45.96% 17.76%～59.91% 22.63%～84.41% 33.08%～100%

(2) Accounts receivable at fair value through other comprehensive income.

For accounts receivable from specific clients, the Group signed the factoring agreement with financial institutions that determine whether to use non-recourse factoring to sell its receivables to the bank or not to sell regarding working capital. The business model of the Group managing this kind of accounts receivable is to complete its goal through receiving contractual cash flows and selling financial assets. Thus, these kinds of accounts receivable are measured through other comprehensive income in fair value.

June 30, 2025

Overdue 1 to 30

Overdue for 31 to

Overdue 61 to 90

Overdue 91 to

Overdue over 121

Not overdue days 60 days days 120 days days Total

December 31, 2024

Overdue 1 to 30

Overdue for 31 to

Overdue 61 to 90

Overdue 91 to

Overdue over 121

Not overdue days 60 days days 120 days days Total

Expected credit loss

rate 0.06% 0.52% 5.84% 17.76% 22.63% 33.08%～100%

Total book value $ 37,016 $ - $ - $ - $ - $ - $ 37,016 Allowance for loss

(expected credit loss

of the given duration) ( 21 ) - - - - - ( 21 ) Cost after amortization $ 36,995 $ - $ - $ - $ - $ - $ 36,995

June 30, 2024

Overdue 1 to 30

Overdue for 31 to

Overdue 61 to 90

Overdue 91 to

Overdue over 121

Not overdue days 60 days days 120 days days Total

Expected credit loss

rate 0.06% 0.52% 5.84% 17.76% 22.63% 33.08%～100%

The information on changes in the allowance for loss on notes receivable and accounts receivable is as follows:

January 1 to June 30, 2025

Notes receivable Accounts receivable Total

As of June 30, 2025, December 31, 2024 and June 30, 2024, the amounts of notes receivable that have expired and have not been cashed were NTD 0 thousand, NTD 0 thousand and NTD 730 thousand, respectively.

Please refer to Note 27 for the amounts of notes receivable pledged by the Group as collateral for notes issued.

For the six months ended June 30, 2025 and 2024, cost of goods sold includes inventory valuation losses of NTD 0 thousand in both periods.

1. Subsidiary

   Subsidiaries included in the consolidated financial statements

   The business entities of the consolidated financial statements are as follows:

   Percentage of shareholdings

   June 30,

   December

   June 30,

   Investor Subsidiary name Nature of the operation 2025 31, 2024 2024 Remark

   The parent company	Rechi Holdings Co., Ltd.	Investment business	100.00%	100.00%	100.00%
   The parent company	Rechi Investments Co., Ltd.	Investment business	100.00%	100.00%	100.00%
   The parent company	Dyna Rechi Co., Ltd.	BLDC Motor	94.42%	94.42%	94.42%	(1), (2)
   Rechi Holdings Co., Ltd.	Rechi International	Investment business	100.00%	100.00%	100.00%	(1)
   	Holdings Co., Ltd.
   Rechi Holdings Co., Ltd.	Rechi Investments	Investment business	100.00%	100.00%	100.00%
   Rechi Holdings Co., Ltd.	Holdings Co., Ltd. Dongguan Rechi	Production and sales of refrigerant	100.00%	100.00%	100.00%	(1)
   	Compressor Co., Ltd.	compressors and refrigerant
   		compressor accessories
   Rechi Holdings Co., Ltd.	TCL Rechi (Huizhou)	Manufacturing and sales of air-	77.78%	77.78%	77.78%	(3)
   	Refrigeration Equipment	conditioning compressors and
   	Company Limited	electric motors, and providing
   		after-sales service and technical
   		consulting service
   Rechi Holdings Co., Ltd.	Rechi Precision (Huizhou)	Production and sales of refrigerant	25.00%	25.00%	25.00%	(1)
   	Mechanism Company	compressors and refrigerant
   		compressor accessories
   Rechi Holdings Co., Ltd.	Rechi Precision (Jiujiang)	Production and sales of refrigerant	100.00%	100.00%	100.00%
   	Electric Machinery	compressors and refrigerant
   	Limited	compressor accessories
   Rechi International	GR Holdings (Hong Kong)	Investment business	100.00%	100.00%	100.00%	(1)
   Holdings Co., Ltd.	Limited
   GR Holdings (Hong Kong)	Rechi Refrigeration	Production and sales of refrigerant	100.00%	100.00%	100.00%	(1)
   Limited	Dongguan Co., Ltd.	compressor motors and air
   		conditioner accessories
   TCL Rechi (Huizhou)	Rechi Precision (Huizhou)	Production and sales of refrigerant	67.86%	67.86%	67.86%	(1)
   Refrigeration Equipment	Mechanism Company	compressors and refrigerant
   Company Limited		compressor accessories
   Rechi Investments Holdings	Rechi Precision (Qingdao)	Production and sales of new	100.00%	100.00%	100.00%
   Co., Ltd.	Electric Machinery	electromechanical components,
   	Limited	fine blanking dies, precision
   		bearings, and relevant accessories
   TCL Rechi (Huizhou)	Qingdao Rechi Electric	Sales business	50.00%	50.00%	50.00%
   Refrigeration Equipment	Machinery Sales

   Company Limited Company

   (Continued on next page)

   (Continued from previous page)

   Percentage of shareholdings

   June 30,

   December

   June 30,

   Investor	Subsidiary name	Nature of the operation	2025	31, 2024	2024	Rema
   Rechi Precision (Qingdao)	Qingdao Rechi Electric	Sales business	50.00%	50.00%	50.00%
   Electric Machinery	Machinery Sales
   Limited	Company
   Rechi Precision (Jiujiang)	Dyna Rechi Jiujiang Co.,	Production and sales of refrigerant	35.50%	35.50%	35.50%	(1)
   Electric Machinery	Ltd.	compressor motors and BLDC
   Limited		motors
   Dyna Rechi Co., Ltd.	Dyna Rechi Holdings Co.,	Investment business	100.00%	100.00%	100.00%	(1)
   Dyna Rechi Holdings Co.,	Ltd. Dyna Rechi Jiujiang Co.,	Production and sales of refrigerant	64.50%	64.50%	64.50%	(1)
   Ltd.	Ltd.	compressor motors and BLDC
   		motors
   Dyna Rechi Co., Ltd.	Ablek Technology Co.,	Sales business	100.00%	100.00%	100.00%	(1)
   Ablek Technology Co., Ltd.	Ltd. Ablek Technology Ltd.	Investment business	100.00%	100.00%	100.00%	(1)
   Ablek Technology Ltd.	Ablek Technology Ltd.	Manufacturing and sales of motors	100.00%	100.00%	100.00%	(1)

   rk

   for household appliances

   1. The aforementioned companies are non-significant subsidiaries, whose financial statements have not been reviewed by independent auditors.

   2. In order to integrate the operation of the BLDC motor business, the Company acquired equity stake in its subsidiary, Dyna Rechi Co., Ltd., on April 17, 2024. The acquisition involves purchasing shares from directors and supervisors of Dyna Rechi Co., Ltd., Taiwan Sanyo Electric Co., Ltd., Richtek Technology Corporation, AccessTop Ltd., director HSU, YUNG FU and his first-degree relatives. The transaction involves acquiring a 28.77% equity stake in Dyna Rechi Co., Ltd., resulting in an increase in the Company's shareholding ratio from 65.65% to 94.42%. Please refer to Note 24 for equity transactions associated with non-controlling interests.

   3. The aforementioned companies are subsidiaries with material non-controlling interests; the material non-controlling interests of the Group did not change significantly for the six months ended June 30, 2025 and 2024.

2. Investment under the equity method Investments in the affiliated company

   Individual non-dominant associates

   Qingdao China Steel

   June 30, 2025

   December 31,

   2024 June 30, 2024

   Precision Metal Co., Ltd.	$ 147,569	$ 169,724	$ 173,551
   COMPRA FOR TRADE
   AND MANUFACTURING S.A.E	43,154	25,572	-
   	$ 190,723	$ 195,296	$ 173,551

   The merged company, in order to be closer to the market and customers, and to diversify the risk of concentrated production bases, has established COMPRA FOR TRADE AND MANUFACTURING S.A.E, a rotary compressor manufacturing and sales company in Egypt through its subsidiary Rechi International Holdings Co., Ltd. The planned capital is

   USD 10,000 thousand, with the merged company holding a 30% stake. To meet the company's capital requirements, the Company invested US$780 thousand and US$678 thousand in October 2024 and June 2025, respectively.

3. Property, plant and equipment

   Machinery and

   Proprietary land Building equipment Other equipment

   Construction in

   progress Total

   Costs Balance as of January 1,
   2024	$ 207,567	$ 3,714,509		$ 8,672,008		$ 1,542,380	$ -		$ 14,136,464
   Additions	-	12,158		75,038		37,421	1,518		126,135
   Disposal	-	-	(	67,092 )	(	49,596 )	-	(	116,688 )
   Net exchange differences	-	163,295		422,487		49,244	21		635,047
   Other reclassification	-	-		20,724		17,584	-		38,308
   Balance as of June 30, 2024	$ 207,567	$ 3,889,962		$ 9,123,165		$ 1,597,033	$ 1,539		$ 14,819,266
   Accumulated depreciation
   and impairment Balance as of January 1,
   2024 $ -		$ 1,608,999	$ 5,929,681		$ 1,229,986		$ -	$ 8,768,666
   Depreciation expenses	- 61,840			278,298		48,713	-		388,851
   Disposal	- -		(	49,359 )	(	40,400 )	- (		89,759 )
   Net exchange differences	- 67,594			294,724		38,657	-		400,975
   Other reclassification -		-	( 12,949 )		1		-	( 12,948 )
   Balance as of June 30, 2024 $ -		$ 1,738,433	$ 6,440,395		$ 1,276,957		$ -	$ 9,455,785
   Net amount as of June 30, 2024 $ 207,567		$ 2,151,529	$ 2,682,770		$ 320,076		$ 1,539	$ 5,363,481

   Costs

   2025	$ 207,567	$ 3,929,216		$ 9,132,258		$ 1,624,905	$ 12,154	$ 14,906,100
   Additions	-	16,671		279,522		39,590	1,132	336,915
   Disposal	- (	1,890 )	(	89,661 )	(	62,430 )	-	( 153,981 )
   Net exchange differences	- (	356,284 )	(	930,385 )	(	105,268 )	( 573 )	( 1,392,510 )
   Other reclassification	-	6,775		108,052		15,205	( 9,870 )	120,162
   Balance as of June 30, 2025	$ 207,567	$ 3,594,488		$ 8,499,786		$ 1,512,002	$ 2,843	$ 13,816,686
   Accumulated depreciation
   and impairment Balance as of January 1,
   2025 $ -		$ 1,788,456	$ 6,518,466		$ 1,294,003		$ -	$ 9,600,925
   Depreciation expenses -		62,901	285,158		48,042		-	396,101
   Disposal	- (	1,086 )	(	82,624 )	( 61,970 )		-	( 145,680 )
   Net exchange differences	- (	157,868 )	(	666,870 )	( 81,725 )		-	( 906,463 )
   Other reclassification -		-	( 26,113 )		( 4,342 )		-	( 30,455 )
   Balance as of June 30, 2025 $ -		$ 1,692,403	$ 6,028,017		$ 1,194,008		$ -	$ 8,914,428
   31, 2024 and January 1, 2025 $ 207,567		$ 2,140,760	$ 2,613,792		$ 330,902		$ 12,154	$ 5,305,175
   Net amount as of June 30, 2025 $ 207,567		$ 1,902,085	$ 2,471,769		$ 317,994		$ 2,843	$ 4,902,258

   Balance as of January 1,

   Net amount as of December

   Depreciation expenses is appropriated in accordance with the straight-line method and the years of useful life illustrated below:

   Building

   Plant building 10 to 55 years

   Electromechanical power equipment 5 to 35 years Engineering systems 2 to 55 years

   Others 3 to 35 years

   Machinery and equipment 1 to 20 years

   Other equipment 1 to 20 years

   Please refer to Note 27 for the amount of property, plant and equipment pledged as guarantees for borrowings.

4. Lease arrangements

   1. Right-of-use assets.

      Carrying amount of right-of-use assets

      Land Building

      Transportation equipment

      $ 118,821	$ 134,593	$ 136,555
      -	-	8,957
      5,692	1,819	2,683
      $ 124,513	$ 136,412	$ 148,195

      June 30, 2025

      December 31,

      2024 June 30, 2024

      	April 1 to June 30, 2025	April 1 to June 30, 2024	January 1 to June 30, 2025	January 1 to June 30, 2024
      Addition of right-of-use assets	$ 4,458	$ 1,147	$ 4,912	$ 1,147

      Depreciation expense of right-of-use assets

      Land	$ 1,029	$ 1,093	$ 2,130	$ 2,156
      Building	-	2,072	-	4,087
      Transportation
      equipment	467	412	938	834
      	$ 1,496	$ 3,577	$ 3,068	$ 7,077

      Except for the additions and depreciation expenses recognized as listed above, the Group did not have any material subleases or impairments of the right-of-use assets during the six months ended June 30, 2025 and 2024.

   2. Lease liabilities

      December 31,

      	June 30, 2025	2024	June 30, 2024
      Carrying amount of lease liabilities Current	$ 1,774	$ 837	$ 10,808
      Non-current	$ 3,930	$ 871	$ 1,742

      The range of lease liability discount is as follows:

      December 31,

      	June 30, 2025	2024	June 30, 2024
      Land	-	-	-
      Building	-	-	1.35%~2.20%
      Transportation equipment	1.35%~2.08%	1.35%~2.00%	1.35%~2.70%

   3. Important rental activities and terms

      The Group leases land located in Mainland China for a lease term of 50 years. All rents have been paid at the time of the lease, and when the lease term is terminated, the Group has no preferential right to acquire the land leased.

   4. Other lease information

The Group has leased out part of the plant buildings, dormitories, machinery, and equipment, etc., under operating leases, with lease terms of 1 to 5 years.

Note: Other prepayments refer to input tax and retained tax credit.

1. Borrowings

   1. Short-term borrowings

      June 30, 2025

      December 31,

      2024 June 30, 2024

      Secured loans (Note 27) - Bank borrowings	$ 1,010,000	$ 860,000	$ -
      Unsecured loans - Credit borrowings	2,984,313	1,890,000	900,000
      	$ 3,994,313	$ 2,750,000	$ 900,000
      Interest rate collars - Secured borrowings	1.87%	1.86%	-
      - Unsecured borrowings	2.00%~5.27%	1.87%~2.10%	1.97%~2.05%

   2. Short-term notes payable

Commercial papers

June 30, 2025

December 31,

2024 June 30, 2024

payable $ 650,000 $ 480,000 $ 630,000 Less: Discount of short-

Note: Others are commission, interest, and utilities expenses payable.

1. Retirement benefits plan

   For the three months ended June 30, 2025 and 2024 and for the six months ended June 30, 2025 and 2024, pension expenses in respect of the Group's defined benefit retirement plans were NTD 289 thousand, NTD 260 thousand, NTD 579 thousand and NTD 520 thousand, respectively, calculated using the actuarially determined pension cost rate as of December 31, 2024 and 2023.

2. Equity

   1. Share capital

      Common shares

      Authorized number of

      June 30, 2025

      December 31,

      2024 June 30, 2024

      shares (thousand shares) 600,000 600,000 600,000 Authorized capital $ 6,000,000 $ 6,000,000 $ 6,000,000 Number of shares issued

      with fully paid-in capital

      (thousand shares) 504,895 504,915 504,915 Outstanding capital $ 5,048,951 $ 5,049,151 $ 5,049,151

      Common stock shares issued at NTD 10 Par and each share is entitled to one voting right and dividends.

   2. Capital reserves

      June 30, 2025

      December 31,

      2024 June 30, 2024

      May be used to offset a deficit, distributed as cash dividends, or transferred to share capital (1) Other capital surplus of shares	$ 279,945	$ 279,956	$ 279,956
      Corporate bond conversion
      premium	1,050,342	1,050,383	1,050,383
      Endowments	1,651	1,651	1,651
      Treasury stock trade Difference between consideration and carrying amount of subsidiaries acquired or	-	11	11
      disposed 23,850 For covering loss carried		23,850	23,850
      forward only. Gains on disposal of assets 21		21	21
      Recognition of changes in ownership interests of subsidiaries (2)	11,693	11,693	11,693
      Others	164	164	164
      	$ 1,367,666	$ 1,367,729	$ 1,367,729

      1. Such additional paid-in capital can be used to make up for losses; also, when the company is without any loss, it can be applied for cash distribution or capitalization. However, it is limited to a certain percentage of the annual paid-in capital for the purpose of capitalization.

      2. Such capital reserves are the effects of equity transactions recognized due to the changes in a subsidiary's equity when the Company has not actually acquired or disposed of the equity of the subsidiary.

      3. Retained earnings and Dividend Policy

         According to the earnings distribution policy of the Company's Articles of Association, if there are earnings in the Company's annual final accounts, the Company shall pay taxes, compensate the accumulated losses over the years, set aside 10% as a statutory surplus reserve, and then appropriate or reverse a special surplus reserve according to the laws or regulations of the competent authority. Regarding the special surplus reserve, if there are still earnings available, shareholder dividends shall be provided therefrom. For stock dividends, the Board of Directors draws up an earnings distribution proposal and submits it to the shareholders' meeting for resolution for distribution of shareholder dividends. If cash dividends are distributed, it shall be approved by a resolution by more than half of all directors present at a board meeting attended by two-thirds or more of all directors and reported to the shareholders' meeting. Please refer to Note 20 (7) regarding the policy for remuneration to the employees and the directors as stipulated in the Company's Articles of Association.

         For the Company's need for sustainable operation and business growth and to take into account the maintenance of profitability, the Company's capital budget plan is adopted to measure the capital needs of the following years. The board of directors drafts a shareholders' dividend distribution plan according to the law every year and submits it to the shareholders' meeting. Shareholders' dividends are distributed in two ways: cash dividends and stock dividends. The cash dividends must not be less than 10% of the total dividends distributed, and the rest are stock dividends.

         Legal reserve shall be allocated up to the amount equivalent to the paid-in capital of the company. Legal reserve could be allocated for covering loss carried forward. If there is no loss, the amount of legal reserve in excess of the paid-in capital by 25% could be allocated as capital stock and paid out as cash dividend.

         The Company has a special reserve appropriated and reversed in accordance with FSC.Certificate.Issue.Tzi No. 1010012865 Letter, FSC.Certificate.Issue.Tzi No. 1010047490 Letter, and "Special reserve appropriation Q&A after the adoption of International Financial Reporting Standards (IFRSs)."

         In the event that the Company sets aside a special reserve from the net deduction of other equity accumulated from the prior periods, if the undistributed earnings from the prior period are insufficient for provision, the special reserve shall be provided from the net income after tax for the current period, plus items other than net income after tax, included in the amount of the undistributed earnings for the current period.

         Proposal for the Company's 2024 and 2023 earnings distribution are as follows:

         Distribution of retained

         earnings Dividend Per Share (NTD)

         	2024	2023	2024 2023
         Legal reserve
         appropriated	$ 101,031	$ 75,423
         Special reserve
         appropriated
         (reversed)	( 541,023 )	168,420
         Cash dividend	742,725	499,995	$ 1.5 $ 1.0

         The aforementioned cash dividend distributions were resolved by the board of directors on March 11, 2025 and March 12, 2024, respectively. The rest earnings appropriation items were resolved by the general shareholders meetings on June 11, 2025 and June 13, 2024, respectively.

      4. Special surplus reserves

         A special surplus reserve appropriated because of the first-time adoption of IFRSs for the exchange differences on translation of the financial statements of foreign operations (including subsidiaries) is reversed based on the percentage of the Company's disposal. When the Company loses significant influence, said reserve will be fully reversed. When distributing the earnings, a special surplus reserve shall be appropriated for the difference between the net deduction of other shareholders' equity and the special surplus reserve for the first-time application of IFRSs at the end of the reporting period. If the amount debited to the other shareholders' equity is reversed subsequently, the reversed amount can be distributed.

         As of June 30, 2025 and 2024, the special surplus reserve provided by the Company in accordance with Letter Jin Guan-Zheng-Fa No. 1010012865 was NTD 556,385 thousand and NTD 1,097,408 thousand, respectively.

      5. Other equity

         1. Exchange differences from the translation of financial statements of foreign operations

            January 1 to June

            30, 2025

            January 1 to June

            30, 2024

            Balance, beginning ( $ 506,385 ) ( $ 1,025,598 )

            Incurred during the current period

            Exchange differences

            on translation of
            foreign operations	( 1,482,823 )	617,551
            Relating income tax	296,565	( 123,510 )
            Balance, ending	( $ 1,692,643 )	( $ 531,557 )

         2. Unrealized gain on financial assets at fair value through other comprehensive income or loss

            	January 1 to June 30, 2025	January 1 to June 30, 2024
            Balance, beginning Generated in current year Unrealized gains or losses - equity instruments	( $ 50,000 ) -	( $ 71,810 ) ( 8,156 )
            Cumulative unrealized gain (loss) of equity instruments transferred to retained earnings due to disposal	-	29,966
            Balance, ending	( $ 50,000 )	( $ 50,000 )

      6. Non-controlling interests

         January 1 to June

         30, 2025

         January 1 to June

         30, 2024

         Balance, beginning $ 948,719 $ 1,162,197 Net income for the period 58,547 38,429 Other comprehensive income of the

         period

         Exchange differences on translation of foreign

         operations ( 101,031 ) 62,779

         Relating income tax 1,132 ( 4,503 )

         Cash dividend to the subsidiary's

         shareholders ( 18,125 ) ( 14,752 ) Acquisition of non-controlling

         interests in subsidiaries (Note 24)	-	( 324,654 )
         Balance, ending	$ 889,242	$ 919,496
         (7) Treasury shares
         Duration		Transfer of shares to employees (thousand shares)
         Number of shares on January 1 and June 30, 2024		4,920

         Number of shares on January 1,

         2025 4,920

         Increase 5,000

         Decrease ( 20 )

         Number of shares on June 30, 2025 9,900

         The company's Treasury stock may not be pledged in accordance with the Security and Exchange Law; moreover, it is without the privilege of dividend and voting right.

3. Business units in continuing operation income

   (1) Interest revenue
   	April 1 to June	April 1 to June		January 1 to		January 1 to
   	30, 2025	30, 2024		June 30, 2025		June 30, 2024
   Bank deposits	$ 30,087	$ 30,412		$ 65,684		$ 60,574
   (2) Other income
   	April 1 to June	April 1 to June		January 1 to		January 1 to
   	30, 2025	30, 2024		June 30, 2025		June 30, 2024
   Rent revenue Other operating
   	leases (Note 14)	$ 4,402	$ 7,322	$ 8,938		$ 11,492
   	Others (Note 23)	12,886	10,930	27,236		34,886
   		$ 17,288	$ 18,252	$ 36,174		$ 46,378
   (3)	Other gains and losses
   		April 1 to June	April 1 to June	January 1 to		January 1 to
   		30, 2025	30, 2024	June 30, 2025		June 30, 2024
   	Profit or loss on financial
   	assets mandatorily
   	measured at fair value
   	through profit or loss	$ 21,331	$ 19,740	$ 41,914		$ 35,216
   Net foreign exchange
   gain (loss)	( 116,133 )		27,956	(	78,840 )		71,962
   Gains (losses) on
   disposal of property,
   plant and equipment
   and right-of-use assets	( 4,682 )	(	9,703 )	(	6,008 )	(	16,275 )
   Others	( 6,401 )	( 2,017 )		( 8,699 )		( 2,424 )
   	( $ 105,885 )	$ 35,976		( $ 51,633 )		$ 88,479

   The components of financial assets at FVTPL are as follows:

   Interest income from wealth management

   April 1 to June

   30, 2025

   April 1 to June

   30, 2024

   January 1 to

   June 30, 2025

   January 1 to

   June 30, 2024

   products $ 22,264 $ 19,618 $ 43,738 $ 35,538 Net gains and losses on

   changes in the fair value of stocks and fund beneficiary

   certificates ( 933 ) 122 ( 1,824 ) ( 322 )

   $ 21,331 $ 19,740 $ 41,914 $ 35,216

   1. Financial costs

      Interest from bank borrowings

      Other interest expenses Interest on lease

      liabilities

      Other financial costs

      April 1 to June

      $ 24,900	$ 20,699	$ 46,005	$ 38,211
      7,672	-	16,378	-
      7	66	15	143
      949	1,951	965	3,421
      $ 33,528	$ 22,716	$ 63,363	$ 41,775

      30, 2025

      April 1 to June

      30, 2024

      January 1 to

      June 30, 2025

      January 1 to

      June 30, 2024

   2. Depreciation and amortization

      April 1 to June

      30, 2025

      April 1 to June

      30, 2024

      January 1 to

      June 30, 2025

      January 1 to

      June 30, 2024

      Consolidation of depreciation expenses based on functions

      Operating costs	$ 160,613	$ 162,528	$ 325,610	$ 320,950
      Operating expenses	36,024	37,921	73,559	74,978
      	$ 196,637	$ 200,449	$ 399,169	$ 395,928

      Consolidation of amortization expenses

      based on functions
      Operating costs	$ 92	$ 37	$ 129	$ 62
      Operating expenses	6,036	3,539	11,870	6,706
      	$ 6,128	$ 3,576	$ 11,999	$ 6,768

   3. Employee benefits expenses

      April 1 to June

      30, 2025

      April 1 to June

      30, 2024

      January 1 to

      June 30, 2025

      January 1 to

      June 30, 2024

      Retirement benefits Defined

      pension plan	$ 3,080	$ 2,795	$ 6,133	$ 5,619
      Defined benefit
      plan (Note 18)	289	260	579	520
      	3,369	3,055	6,712	6,139
      r employee benefits 530,962		682,337	1,232,375	1,210,212
      penses $ 534,331		$ 685,392	$ 1,239,087	$ 1,216,351

      contribution

      Othe

      Total employee benefits ex

      Consolidation based on functions

      Operating costs	$ 327,998	$ 423,405	$ 763,288	$ 764,781
      Operating expenses	206,333	261,987	475,799	451,570
      	$ 534,331	$ 685,392	$ 1,239,087	$ 1,216,351

   4. Remuneration to the employees and the directors

      According to the Company's Articles of Association, based on the current year's pre-tax income before deduction of the remuneration to employees and directors, no less than 1% and no greater than 8% of the balance is allocated as remuneration to employees, and no more than 3% for remuneration to directors. For the six months ended June 30, 2025 and 2024, the remuneration to employees and directors was estimated based on the aforementioned pre-tax profit and the possible distributable amount according to the past experience.

      According to the amendment to the Securities and Exchange Act in August 2024, the Company passed an amendment to Articles of Incorporation in the 2025 shareholders' meeting, stipulating that no less than 15% of the employee remuneration appropriated for the current year should be set aside as the remuneration to the entry-level employees.

      The estimated remuneration to employees and directors for the three months ended June 30, 2025 and 2024 and for the six months ended June 30, 2025 and 2024 is recognized as follows:

      Amount

      	April 1 to June 30,	April 1 to June 30,	January 1 to June	January 1 to June
      	2025	2024	30, 2025	30, 2024
      Remuneration to employees	$ 15,828	$ 22,512	$ 41,084	$ 38,811
      Remuneration of Directors	$ 4,565	$ 6,494	$ 11,851	$ 11,196

      If there are still changes in the amount specified in the consolidated financial statement after announcement, proceed to the accounting of change and adjusted for booking in the next fiscal year.

      The remuneration to employees and directors for 2024 and 2023 was resolved by the board of directors on March 11, 2025 and March 12, 2024, respectively, as follows:

      2024 2023

      Cash Stock Cash Stock

      Remuneration to employees Remuneration of

      Directors

      $ 67,664 $ - $ 47,332 $ -19,519 - 14,791 -

      There is no difference between the remuneration to employees and directors actually distributed for 2024 and 2023 and the amount recognized in the consolidated financial statements for 2024 and 2023.

      For information on the remuneration to employees and directors as resolved by the Company's board of directors, please visit the Market Observatory Post System of the Taiwan Stock Exchange.

   5. Foreign exchange gain (loss)

   	April 1 to June	April 1 to June	January 1 to	January 1 to
   	30, 2025	30, 2024	June 30, 2025	June 30, 2024
   Total foreign exchange
   gains	$ 183,851	$ 58,159	$ 286,082	$ 127,607
   Total foreign exchange
   loss	( 299,984 )	( 30,203 )	( 364,922 )	( 55,645 )
   Net gains (losses)	( $ 116,133 )	$ 27,956	( $ 78,840 )	$ 71,962

4. Continuing department income tax

   1. Income tax recognized in profit or loss

      The major components of income tax expense (income) are as follows:

      Income tax expenses in the current period Incurred in the

      April 1 to June

      30, 2025

      April 1 to June

      30, 2024

      January 1 to

      June 30, 2025

      January 1 to

      June 30, 2024

      current period $ 274,065 $ 322,768 $ 485,167 $ 457,555 Additional levy on

      undistributed

      earnings 35,379 520 35,379 520

      Prior year

      adjustment	( 282,145 )	( 130,233 )	( 281,031 )	( 171,960 )
      	27,299	193,055	239,515	286,115
      (Continued on next page)

      (Continued from previous page)

      April 1 to June

      30, 2025

      April 1 to June

      30, 2024

      January 1 to

      June 30, 2025

      January 1 to

      June 30, 2024

      Deferred tax Incurred in the
      current period Prior year	( $ 130,963 )	( $ 127,539 )	( $ 117,562 )	( $ 91,468 )
      adjustment	190,934	99,171	176,243	100,857
      Income tax expense	59,971	( 28,368 )	58,681	9,389
      recognized in the profit or loss	$ 87,270	$ 164,687	$ 298,196	$ 295,504

   2. Income tax recognized in the other comprehensive income or loss

      Deferred tax Incurred during the

      current period

      - Exchange

      April 1 to June

      30, 2025

      April 1 to June

      30, 2024

      January 1 to

      June 30, 2025

      January 1 to

      June 30, 2024

      differences from
      the translation
      of financial
      statements of
      foreign
      operations (3) Income tax audit	( $ 335,673 )	$ 25,987	( $ 297,697 )	$ 128,013

      The profit-seeking enterprise income tax returns filed by the Company and its domestic subsidiaries, Rechi Investments Co., Ltd., Dyna Rechi Co., Ltd., and Ablek Technology Co., Ltd., up to 2021, 2023, 2023, and 2023, respectively have been approved by the tax collection authority, and the remaining subsidiaries file local income tax returns in accordance with local regulations.

5. Earnings per share (EPS)

April 1 to June

April 1 to June

January 1 to

Unit: NTD per share January 1 to

30, 2025

30, 2024

June 30, 2025

June 30, 2024

Basic earnings per share $ 0.46 $ 0.65 $ 1.18 $ 1.15

Diluted earnings per share $ 0.46 $ 0.65 $ 1.18 $ 1.15

The earnings and weighted average common stock shares used in calculating the earnings per share are as follows:

Net income for the period

The net income applied to calculate basic earnings per

April 1 to June

30, 2025

April 1 to June

30, 2024

January 1 to

June 30, 2025

January 1 to

June 30, 2024

share $ 226,661 $ 325,734 $ 586,973 $ 575,422