Interim report
Page 1
~1~ Stock code: 4585 Techman Robot Inc. and Subsidiaries Consolidated Financial Statements with Independent Auditors’ Report For the Years Ended December 31, 2025 and 2024 Company Address: 5F., No. 58-2, Huaya 2nd Rd., Guishan Dist., Taoyuan City Tel: (03)328-8350 The independent auditor’s report and the accounting parent company only financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditor’s report and parent company only financial statements, the Chinese version shall prevail.
Page 2
~2~ Table of Contents Items Page No. 1. Cover 1 2. Table of Contents 2 3. Declaration 3 4. Independent Auditors’ Report 4 5. Consolidated Balance Sheets 5 6. Consolidated Statement of Comprehensive Income 6 7. Consolidated Statement of Changes in Equity 7 8. Consolidated Statement of Cash Flows 8 9. Notes to the Consolidated Financial Statements (1) Company history 9 (2) Date and procedures for approval of financial reports 9 (3) Application of newly issued and revised standards and interpretations 9–11 (4) Summary of significant accounting policies 11–27 (5) Major sources of uncertainty in significant accounting judgments, estimates, and assumptions 28 (6) Explanation of significant accounting items 28–62 (7) Related party transactions 63–65 (8) Pledged assets 66 (9) Significant contingent liabilities and unrecognized contractual commitments 66 (10) Significant disaster losses 66 (11) Significant subsequent events 66 (12) Others 67 (13) Matters disclosed in the notes 1. Information on significant transactions 67–69 2. Information on investee enterprises 70 3. Information on investment in China 70 (14) Segment information 71
Page 3
~3~ Declaration For 2025 (from January 1 to December 31, 2025), the companies that the Company is required to include in the preparation of related enterprise consolidated financial statements in accordance with the “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises” are the same as those required to be included in the preparation of parent and subsidiary consolidated financial statements under IFRS 10 as recognized by the FSC. The relevant information required to be disclosed in the related enterprise consolidated financial statements has already been disclosed in the aforementioned parent and subsidiary consolidated financial statements. Accordingly, no separate related enterprise consolidated financial statements have been prepared. Hereby declare Company Name: Techman Robot Inc. Chairman: Ho Shih-Chih Date: February 3, 2026
Page 4
~4~ Independent Auditors’ Report To the Board of Directors of Techman Robot Inc.: Audit Opinions We have audited the balance sheets of Techman Robot Inc. and its subsidiaries (Techman Robot Group) as of December 31, 2025 and 2024, and the consolidated statements of comprehensive income, changes in equity, and cash flows for the years ended December 31, 2025 and 2024, as well as the notes to the consolidated financial statements (including a summary of significant accounting policies). In our opinion, the aforementioned consolidated financ ial statements present fairly, in all material respects, the consolidated financial position of the Techman Robot Group as of December 31, 2025 and 2024, and its consolidated financial performance and consolidated cash flows for the periods from January 1 to December 31, 2025 and 2024, in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards, International Accounting Standards, Interpretations, and Interpretation Bulletins endorsed and issued into effect by the FSC. Basis for opinion We conducted our audits in accordance with the Regulations Governing Financial Statement Audit and Attestation Engagements of Certified Public Accountants and the auditing sta ndards. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. Personnel of the firm to which we belong who are subject to the independence requirements have maintained independence from Techman Robot Group in accordance with the Code of Professional Ethics for Certified Public Accountants and have fulfilled other responsibilities under the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Page 5
~4-1~ Key audit matters Key audit matters are those matters that, in our professional judgment, were of most significance in the audit of the consolidated financial statements of Techman Robot Group for the year ended 2025. These matters were addressed in the context of our audit of the consolidated financial statements as a whole and in forming our audit opinion thereon, and we do not express a separate opinion on these matters. The key audit matters that, in our judgment, should be communicated in the audit report are as follows: I. Timing of revenue recognition For the accounting policy on revenue recognition, please refer to Note 4(14) to the consolidated financial statements, and for the description of significant accounting items, please refer to Note 6(22). Description of key audit matters: Techman Robot Group is primarily engaged in the R&D, production, and sale of collaborative industrial robots. Sales revenue is recognized based on contractual transaction terms and upon the transfer of control of the goods . As the timing of revenue recognition has a significant impact on the financial statements, we consider testing the timing of revenue recognition to be an important assessment matter in the audit of the consolidated financial statements of Techman Robot Group. Audit procedures performed: Our principal audit procedures for the above key audit matter included understanding and testing the internal controls over sales revenue to confirm whether the internal controls were effectively implemented; understanding the accounting policies for revenue recognition to confirm whether the accounting treatment complied with the relevant standards; selecting shipments for a period before and after the balance sheet date and verifying the related supporting documents and forms to confirm whether sales revenue was recognized in the appropriate period in the financial statements. II. Allowance for inventory valuation For the accounting policies on inventories and the uncertainties related to accounting estimates and assumptions, please refer to Notes 4(8) and 5 to the consolidated financial statements; for the description of significant accounting items, please refer to Note 6(7) to the consolidated financial statements. Description of key audit matters: Inventories in the financi al statements are measured at the lower of cost and net realizable value. Due to the long turnover cycle of collaborative industrial robots, inventories may be subject to valuation or obsolescence losses, and the assessment of net realizable value involves management judgment. Accordingly, we have identified the allowance for inventory valuation as a key audit matter. Audit procedures performed:
Page 6
~4-2~ Our principal audit procedures for the above key audit matter included understanding the inventory valuation and obsolescence evaluation policies adopted by management and assessing their appropriateness; selecting the most recent sales market prices of products and the most recent replacement costs of raw materials, recalculating net realizable value after computing the selling expense rate, and assessing whether the net realizable value adopted by management was reasonable; performing sampling procedures to examine the accuracy of the inventory aging schedule; and reviewing whether the disclosures related to the all owance for inventory valuation made by management were appropriate. Other matters Techman Robot Inc. has prepared i ts parent company only financial statements as of and for the years ended December 31, 2025 and 2024, on which we have issued an unmodified opinion. Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulatio ns Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards, International Accounting Standards, Interpretations, and Interpretation Bulletins endorsed and issued into effect by the FSC, and for maintaining such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, management is also responsible for assessing Techman Robot Group’s ability to continue as a going concern, disclosing related matters, and applying the going concern basis of accounting, unless management intends to liquidate Techman Robot Group or cease operations, or has no realistic alternative but to do so. Those charged with governance of Techman Robot Group (including the Audit Committee) are responsible for overseeing the financial reporting process. Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements The objective of our audit of the consolidated financial statements is to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from mater ial misstatement, whether due to fraud or error, and to issue an auditors’ report. Reasonable assurance is a high level of assurance, but an audit conducted in accordance with auditing standards cannot guarantee that material misstatements in the consolidated financial statements will always be detected. Misstatements may arise from fraud or error. Misstatements are considered material if the individual amounts or the aggregate amounts can reasonably be expected to influence the economic decisions of users taken on the basis of the consolidated financial statements. When conducting our audit in accordance with the auditing standards, we exercise professional judgment and maintain professional skepticism. We also perform the following procedures:
Page 7
~4-3~ 1. Identify and assess the risks of material misstatement of the consolidated financial statements due to fraud or error; design and perform appropriate audit procedures in response to the assessed risks; and obtain sufficient and appropriate audit evidence a s a basis for the audit opinion. Because fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control, the risk of not detecting a material misstatement resulting from fraud is higher than that resulting from error. 2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Techman Robot Group’s internal control. 3. Evaluate the appropriateness of the accounting policies adopted by management and the reasonableness of the accounting estimates and related disclosures made by management. 4. Based on the audit evidence obtained, conclude on the appropriate ness of management’s use of the going concern basis of accounting and whether a material uncertainty exists related to events or conditions that may cast significant doubt on Techman Robot Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists regarding such events or conditions, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements, or to modify our audit opinion if such disclosures are inadequate. Our conclusion is based on the audit evidence obtained up to the date of the audit report. However, future events or conditions may cause Techman Robot Group to cease to continue as a going concern. 5. Evaluate the overall presentation, structure, and content of the consolidated financial statements (including the related notes), and whether the consolidated financial statements fairly present the underlying transactions and events. 6. Obtain sufficient and appropriate audit evidence regarding the financia l information of the entities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of the Group audit and for forming the Group audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including significant deficiencies in internal control identified during the audit. We also provide those charged with governance with a statement that the personnel of the firm to which we belong who are subject to independence requirements have complied with the independence provisions of the Code of Professional Ethics for Certified Public Accountants, and communicate with those charged with governance all relationships and other matters that may reasonably be thought to bear on the auditor’s independence, including related safeguards.
Page 8
~4-4~ From the matters communicated with those charged with governance, we determine the key audit matters for the audit of the consolidated financial statements of Techman Robot Group for the year ended 2025. We describe these matters in the audit report unless laws or regulations preclude public disclosure of the specific matter or, in extremely rare circumstances, we determine that a matter should not be communicated in the audit report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. The engagement partners on the audit resulting in this independent auditor’s report are Lien, Shu-Ling and Chen, Yi-Chun. KPMG Taipei, Taiwan (Republic of China) February 24,2026
Page 9
Techman Robot Inc. and Subsidiaries Consolidated Balance Sheets December 31, 2025 and 2024 Unit: NT$ thousands (Please refer to the accompanying notes to the consolidated financial statements) ~5~ 2025.12.31 2024.12.31 Assets Amount % Amount % Current assets: 1100 Cash and cash equivalents (Note 6(1)) $ 343,042 4 312,477 13 1110 Financial assets at fair value through profit or loss - current (Note 6(2)) 3,783,065 49 501,512 20 1120 Financial assets measured at fair value through other comprehensive income - current (Note 6(3)) 222,397 3 110,786 4 1150 Net notes receivable (Note 6(5)) Financial Holding 50,417 1 41,005 2 1170 Net accounts receivable (Note 6(5)) 159,525 2 69,971 3 1180 Net accounts receivable - related parties (Notes 6(5) and 7) 109,067 2 141,508 6 1200 Other receivables (Notes 6(6)) 17,854 - 9,616 - 1310 Inventories - manufacturing industry (Note 6(7)) 466,575 6 487,688 20 1476 Other financial assets - current (Notes 6(11) and 8) 734,822 9 54,797 2 1479 Other current assets - other 32,816 - 20,378 1 5,919,580 76 1,749,738 71 Non-current assets: 1535 Financial assets measured at amortized cost - non-current (Note 6(4)) 1,623,016 21 525,818 22 1600 Property, plant and equipment (Note 6(8)) 41,677 1 51,827 2 1755 Right-of-use assets (Note 6(9)) 57,533 1 78,019 3 1780 Intangible assets (Note 6(10)) 12,121 - 10,605 - 1840 Deferred income tax assets (Note 6(18)) 43,478 1 36,217 2 1915 Prepayment for equipment 14,482 - 7,800 - 1980 Other financial assets - non-current (Notes 6(11) and 8) 37,449 - 11,888 - Total non-current assets 1,829,756 24 722,174 29 Total assets $ 7,749,336 100 2,471,912 100 2025.12.31 2024.12.31 Liabilities and equity Amount % Amount % Current liabilities: 2100 Short-term borrowings (Note 6(12) and (28)) $ 50,417 1 - - 2130 Contract liabilities - current (Note 6(22)) 182,246 2 122,922 5 2170 Accounts payable 245,115 3 205,256 8 2200 Other payables (Note 7) 214,679 3 188,656 8 2230 Current income tax liabilities 11,304 - 11,162 - 2250 Provisions for liabilities - current (Note 6(13)) 82,776 1 62,992 3 2280 Lease liabilities - current (Notes 6(15) and (28)) 38,152 1 32,791 1 2365 Refund liabilities - current (Note 6(14)) 6,798 - 9,631 - 2399 Other current liabilities - others 17,289 - 8,840 - 848,776 11 642,250 25 Non-current liabilities: 2570 Deferred income tax liabilities (Note 6(18)) 1,981 - 3,137 - 2580 Lease liabilities - non-current (Notes 6(15) and (28)) 19,647 - 45,993 2 2630 Long-term deferred income (Note 6(16)) 5,300 - 6,653 1 2640 Net defined benefit liabilities - non-current (Note 6(17)) 2,437 - 1,645 - 29,365 - 57,428 3 Total liabilities 878,141 11 699,678 28 Equity (Note 6(19)): 3110 Common stock capital 1,028,000 14 900,000 37 3140 Advance receipts for share capital 97,926 1 - - 3200 Capital surplus 5,347,426 69 610,417 25 3300 Retained earnings 396,291 5 260,228 10 3400 Other equity 1,552 - 1,589 - Total equity 6,871,195 89 1,772,234 72 Total liabilities and equity $ 7,749,336 100 2,471,912 100
Page 10
(Please refer to the accompanying notes to the consolidated financial statements) ~6~ Techman Robot Inc. and Subsidiaries Consolidated Statement of Comprehensive Income January 1 to December 31, 2025 and 2024 Unit: NT$ thousands 2025 2024 Amount % Amount % 4110 Operating revenue (Notes 6(22) and 7) $ 1,822,095 100 1,481,037 100 5110 Operating costs (Notes 6(7), (23) and 7) 893,097 49 719,814 49 Gross profit 928,998 51 761,223 51 Operating expenses (Notes 6(17), (23) and 7): 6100 Selling expenses 332,435 18 305,226 21 6200 Administrative expenses 100,938 6 87,772 6 6300 R&D expenses 384,500 21 346,580 23 Total operating expenses 817,873 45 739,578 50 Net operating income 111,125 6 21,645 1 Non-operating income and expenses: 7100 Interest income (Note 6(24)) 35,009 2 22,636 2 7010 Other income (Note 6(24)) 4,875 - 4,592 - 7020 Other gains and losses (Note 6(24) and 7) 4,960 - 59,538 4 7050 Financial costs (Notes 6(15) and (24)) (3,381) - (1,676) - Total non-operating income and expenses 41,463 2 85,090 6 Net profit before tax 152,588 8 106,735 7 7950 Less: Income tax expenses (Note 6(18)) 16,218 1 12,960 1 Net income for the current period 136,370 7 93,775 6 8300 Other comprehensive income: 8310 Items not reclassified to profit or loss 8311 Remeasurements of defined benefit plans (383) - 41 - 8316 Unrealized valuation gain or loss on investments in equity instruments measured at fair value through other comprehensive income (143) - 2,604 - 8349 Income tax related to items that will not be reclassified to profit or loss 76 - (8) - Total items not reclassified to profit or loss (450) - 2,637 - 8360 Items that may be subsequently reclassified to profit or loss 8361 Exchange differences on translation of financial statements of foreign operations 106 - 1,509 - 8399 Income tax related to items that may be subsequently reclassified to profit or loss - - - - Total items that may be subsequently reclassified to profit or loss 106 - 1,509 - Other comprehensive income for the period (net of tax) (344) - 4,146 - 8500 Total comprehensive income for the period $ 136,026 7 97,921 6 Earnings per share (Note 6(21)) 9750 Basic earnings per share (Unit: NT$) $ 1.46 1.04 9850 Diluted earnings per share (Unit: NT$) $ 1.44 1.02
Page 11
(Please refer to the accompanying notes to the consolidated financial statements) ~7~ Techman Robot Inc. and Subsidiaries Consolidated Statement of Changes in Equity January 1 to December 31, 2025 and 2024 Unit: NT$ thousands Other equity items Exchange differences on translation of financial statements of foreign operations Unrealized gain or loss on financial assets measured at fair value through other comprehensive income Retained earnings Common stock capital Advance receipts for share capital Capital surplus Legal reserve Special reserve Undistributed earnings Total equity Balance as of January 1, 2024 $ 900,000 - 607,725 22,290 1,979 142,151 (2,466) (58) 1,671,621 Net income for the current period - - - - - 93,775 - - 93,775 Other comprehensive income for the current period - - - - - 33 1,509 2,604 4,146 Total comprehensive income for the period - - - - - 93,808 1,509 2,604 97,921 Earnings appropriation and distribution: Appropriation of legal reserve - - - 1,149 - (1,149) - - - Appropriation of special reserve - - - - 545 (545) - - - Share-based payment transactions - - 2,692 - - - - - 2,692 Balance as of December 31, 2024 900,000 - 610,417 23,439 2,524 234,265 (957) 2,546 1,772,234 Net income for the current period - - - - - 136,370 - - 136,370 Other comprehensive income for the current period - - - - - (307) 106 (143) (344) Total comprehensive income for the period - - - - - 136,063 106 (143) 136,026 Earnings appropriation and distribution: Appropriation of legal reserve - - - 9,381 - (9,381) - - - Reversal of special reserve - - - - (2,524) 2,524 - - - Cash capital increase 128,000 - 4,721,651 - - - - - 4,849,651 Share-based payment transactions - 97,926 15,358 - - - - - 113,284 Balance as of December 31, 2025 $ 1,028,000 97,926 5,347,426 32,820 - 363,471 (851) 2,403 6,871,195
Page 12
(Please refer to the accompanying notes to the consolidated financial statements) ~8~ Techman Robot Inc. and Subsidiaries Consolidated Statement of Cash Flows January 1 to December 31, 2025 and 2024 Unit: NT$ thousands 2025 2024 Cash flows from operating activities: Profit before tax for the current period $ 152,588 106,735 Adjustment items: Income and expense items Depreciation expenses 66,189 66,788 Amortization expenses 11,280 8,364 Net gain on financial assets and liabilities measured at fair value through profit or loss (16,361) (8,909) Interest expenses 3,381 1,676 Net gain on disposal of financial assets measured at amortized cost (623) - Interest income (35,009) (22,636) Dividend income (4,875) (4,592) Loss on disposal and retirement of property, plant and equipment 25 - Unrealized foreign exchange losses (gains) 7,361 (12,540) Employee stock option expenses 15,358 2,692 Total income and expense items 46,726 30,843 Changes in assets and liabilities related to operating activities: Notes receivable (9,971) (35,487) Accounts receivable (89,350) (4,113) Accounts receivable - related parties 32,093 (5,474) Other receivables (2,175) 1,460 Inventory 19,475 (162,169) Other current assets (12,336) (9,052) Other financial assets (20,211) (7,427) Contract liabilities 60,640 92,770 Accounts payable 40,011 77,502 Other payables 26,177 17,958 Refund liabilities (2,776) 5,361 Other current liabilities 8,400 (716) Net defined benefit liabilities 409 327 Provision for liabilities 19,784 8,120 Deferred income (1,353) 6,653 Total net changes in assets and liabilities related to operating activities 68,817 (14,287) Total adjustment items 115,543 16,556 Cash inflow from operations 268,131 123,291 Interest received 26,529 16,904 Dividends received 4,875 4,592 Interest paid (3,473) (1,676) Income tax paid (24,417) (11,745) Net cash inflow from operating activities 271,645 131,366 Cash flows from investing activities: Acquisition of financial assets measured at fair value through other comprehensive income (111,754) (79,770) Acquisition of financial assets measured at amortized cost (1,240,585) (263,766) Disposal of financial assets measured at amortized cost 139,072 - Acquisition of financial assets measured at fair value through profit or loss (5,149,000) (290,000) Disposal of financial assets measured at fair value through profit or loss 1,883,808 553,764 Acquisition of property, plant and equipment (16,007) (22,355) Acquisition of intangible assets (12,796) (12,460) Increase (decrease) in other financial assets (685,040) 26,474 Increase (decrease) in prepayments for equipment (6,682) (135) Net cash outflow from investing activities (5,198,984) (88,248) Cash flows from financing activities: Short-term borrowings 49,218 - Repayment of lease principal (40,613) (34,355) Cash capital increase 4,849,651 - Exercise of employee stock options 97,926 - Net cash inflow (outflow) from financing activities 4,956,182 (34,355) Effect of exchange rate changes on cash and cash equivalents 1,722 (2,361) Net increase in cash and cash equivalents for the period 30,565 6,402 Cash and cash equivalents balance at beginning of the period 312,477 306,075 Cash and cash equivalents balance at end of the period $ 343,042 312,477
Page 13
~9~ Techman Robot Inc. and Subsidiaries Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 (Unless otherwise specified, all amounts are expressed in thousands of NT$) 1. Company history Techman Robot Inc. (hereinafter referred to as “the Company”) was approved for incorporation by the Ministry of Economic Affairs on September 18, 2015, with its registered address at 5F., No. 58- 2, Huaya 2nd Rd., Guishan Dist., Taoyuan City. The Company and its subsidiaries (hereinafter collectively referred to as the consolidated company) are primarily engaged in the research, devel opment, production, manufacturing, and sales of collaborative industrial robots. The consolidated company’s shares were approved for listing by the Taiwan Stock Exchange and have been officially listed for trading on the Taiwan Stock Exchange since September 26, 2025. The consolidated company’s parent company is Quanta Storage Inc., and its ultimate parent company is Quanta Computer Inc. 2. Date and procedures for approval of financial reports These consolidated financial statements were authorized for issuance by the Board of Directors on February 3, 2026. 3. Application of newly issued and revised standards and interpretations (1) Impact of new and revised standards and interpretations approved by the FSC The consolidated company has applied the following newly amended IFRS since January 1, 2025, and they have not had a material impact on the consolidated financial statements. ‧ Amendments to IAS 21 “Lack of Exchangeability” (2) Impact of IFRS Accounting Standards approved by the FSC but not yet adopted The consolidated company has evaluated the following newly amended IFRS that become effective on January 1, 2026, and expects that they will not have a material impact on the consolidated financial statements. ‧ IFRS 17 “Insurance Contracts” and amendments to IFRS 17 ‧ Amendments to IFRS 9 and IFRS 7 “Amendments to the Classification and Measurement of Financial Instruments” ‧ Annual Improvements to IFRS Accounting Standards ‧ Amendments to IFRS 9 and IFRS 7 “Contracts Referencing Nature-dependent Electricity”
Page 14
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~10~ (3) Newly issued and revised standards and interpretations not yet approved by the FSC Standards and interpretations issued or amended by the IASB but not yet endorsed by the FSC that may be relevant to the consolidated company are as follows: Newly issued or revised standards Main revisions Effective date issued by the Board IFRS 18 “Presentation and Disclosure in Financial Statements” The new standard introduces three categories of income and expenses, two subtotals in the statement of profit or loss, and a single note regarding management performance measures. These three amendments also enhance the guidance on how information is disaggregated in financial statements, establishing a foundation for providing users with bette r and more consistent information, and will affect all companies. ‧ A more structured statement of profit or loss: Under current standards, companies use different formats to present their operating results, making it difficult for investors to compare finan cial performance across companies. The new standard adopts a more structured statement of profit or loss, introduces a newly defined subtotal of “operating profit,” and requires all income and expenses to be classified into three new categories according t o the Company’s main operating activities. ‧ MPMs: The new standard introduces a definition of management performance measures and requires companies to explain in a single note to the financial statements why each measure provides useful information, how it is calculated, and how the measure is reconciled with the amounts recognized in accordance with IFRS Accounting Standards. ‧ More disaggregated information: The new standard includes guidance on how companies enhance the grouping of information in financial statements. This includes guidance on whether information should be presented in the primary financial statements or further disaggregated in the notes. January 1, 2027 Note: The FSC issued a press release on September 25, 2025 announcing that Taiwan will adopt IFRS 18 starting from the 2028 fiscal year. If a company has a need for early adoption, it may choose to adopt early after obtaining approval from the FSC.
Page 15
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~11~ The consolidated company is currently evaluating the impact of the aforementioned standards and interpretations on its financial position and operating results, and the relevant impact will be disclosed upon completion of the evaluation. The consolidated company expects that the following other newly issued and amende d standards not yet endorsed will not have a material impact on the consolidated financial statements. ‧ Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Affiliate or Joint Venture” ‧ IFRS 19 “Subsidiaries without Public Accountability: Disclosures” and amendments to IFRS 19 ‧ Amendments to IAS 21 “Translation to a Hyperinflationary Presentation Currency” 4. Summary of significant accounting policies The significant accounting policies adopted in these consolidated financial statements are summarized as follows. The following accounting policies have been applied consistently to all periods presented in these consolidated financial statements. (1) Compliance Statement These consolidated fina ncial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers (hereinafter referred to as the “Regulations”) and International Financial Reporting Standards (IFRS) Accounting Sta ndards, International Accounting Standards (IAS), Interpretations and Interpretation Bulletins approved and issued by the Financial Supervisory Commission (hereinafter referred to as the “IFRS Accounting Standards approved by the FSC”). (2) Basis of preparation a. Measurement bases Except for the following significant items in the balance sheets , these consolidated financial statements have been prepared on the historical cost basis: (a) Financial assets measured at fair value through profit or loss measured at fair value; (b) Financial assets measured at fair value through other comprehensive income measured at fair value; (c) Net defined benefit liabilities (or assets), measured at the fair value of plan assets less the present value of the defined benefit obligation and the effect of the asset ceiling as described in Note 6(17). b. Functional currency and presentation currency The consolidated company’s functional currency is the currency of the primary
Page 16
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~12~ economic environment in which it operates. These consolidated financi al statements are presented in NT$, the Company’s functional currency. All financial information presented in NT$ is expressed in NT$ thousands. (3) Basis for consolidation a. Principles for the preparation of consolidated financial statements The entities included in the preparation of the consolidated financial statements comprise the Company and entities controlled by the Company (i.e., subsidiaries). The Company controls an entity when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. From the date the Company obtains control of a subsidiary, its financial statements are included in the consolidated financial statements until the date control is lost. Transactions, balances, and any unrealized gains and losses between the consolidated companies have been fully eliminated in the preparation of the consolidated financial statements. The total comprehensive income of subsidiaries is attributed to the owners of the Company and to non-controlling interests, even if this results in a deficit balance for the non -controlling interests. The financial statements of subsidiaries have been appropriately adjusted so that their accounting policies are consistent with those used by the consolidated company. Changes in the consolidated company’s ownership interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions with owners. The difference between th e adjustment to non- controlling interests and the fair value of the consideration paid or received is recognized directly in equity and attributed to the owners of the Company. b. Subsidiaries included in the consolidated financial statements Subsidiaries included in these consolidated financial statements comprise: Name of investee company Business nature Percentage of ownership held Name of subsidiary 2025.12.31 2024.12.31 Description The Company Techman Robot (HONG KONG) Ltd. (TRH) Investment businesses 100% 100% " TECHMAN ROBOT GLOBAL INVESTMENT LIMITED(TRG) Investment businesses 100% - % Note 1 TRH Techman Robot (Shanghai) Ltd. (TRS) Maintenance and sales of industrial collaborative robots and related components 100% 100%
Page 17
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~13~ Note 1: In November 2025, the consolidated company invested in the establishment of Techman Robot Global Investment Ltd., with a 100% ownership interest. As of December 31, 2025, no capital had yet been injected. c. Subsidiaries not included in the consolidated financial statements: None. (4) Foreign currency a. Foreign currency transactions Foreign currency transactions are translated into the functional currency using the exchange rates at the transaction date. At the end of each subsequent reporting period (hereinafter referred to as the reporting date), foreign currency monetary items are translated into the functional currency at the exchange rate on that date. Foreign currency non - monetary items measured at fair value are translated into the functional currency using the exchange rates at the date the fair value is determined, while foreign currency non-monetary items measured at historical cost are translated using the exchange rates at the transaction date. Exchange differences arising from translation are generally recognized in profit or loss. b. Foreign operations The ass ets and liabilities of foreign operations, including goodwill arising on acquisition and fair value adjustments, are translated into NT$ using the exchange rates at the reporting date; income and expense items are translated into NT$ using the average exchange rates for the period, and the resulting exchange differences are recognized in other comprehensive income. When the disposal of a foreign operation results in the loss of control, joint control, or significant influence, the cumulative exchange differences related to that foreign operation are fully reclassified to profit or loss. When a subsidiary that includes a foreign operation is partially disposed of, the related cumulative exchange differences are reattributed to non- controlling interests on a proportional basis. When an investment in an affiliate or joint venture that includes a foreign operation is partially disposed of, the related cumulative exchange differences are reclassified to profit or loss on a proportional basis. For monetary receivables or payables with foreign operations, if there is no plan for settlement and settlement is not expected in the foreseeable future, the foreign exchange gains or losses arising therefrom are regarded as part of the net investment in the foreign operation and recognized in other comprehensive income. (5) Classification criteria for current and non-current assets and liabilities The consolidated company classifies an asset as current when it meets one of the following conditions; all other assets that do not qualify as current assets are classified as non- current assets:
Page 18
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~14~ a. The asset is expected to be realized in the normal operating cycle, or is intended to be sold or consumed; b. The asset is held primarily for trading purposes; c. The asset is expected to be realized within twelve months after the reporting period; or d. The asset is cash or cash equivalents (as defined in IAS 7), unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. The co nsolidated company classifies a liability as current when it meets one of the following conditions; all other liabilities that do not qualify as current liabilities are classified as non-current liabilities: a. The liability is expected to be settled in the normal operating cycle; b. The liability is held primarily for trading purposes; c. The liability is due to be settled within twelve months after the reporting period; or d. The entity does not have the right at the end of the reporting period to defer settlement of the liability for at least twelve months after the reporting period. (6) Cash and cash equivalents Cash includes cash on hand and demand deposits. Cash equivalents refer to short -term, highly liquid investments that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value. Time deposits that meet the above definition and are held for the purpose of meeting short -term cash commitments rather than for investment or other purposes are presented as cash equivalents. (7) Financial instruments Accounts receivable are initially recognized when they arise. All other financial assets and financial liabilities are initially recognized when the consolidated company becomes a party to the contractual provisions of the financ ial instrument. Financial assets not measured at fair value through profit or loss (except for accounts receivable that do not contain a significant financing component) or financial liabilities are initially measured at fair value plus transaction costs t hat are directly attributable to the acquisition or issuance. Accounts receivable that do not contain a significant financing component are initially measured at the transaction price. a. Financial assets For purchases or sales of financial assets that are regular way transactions, the consolidated company consistently applies settlement date accounting for all purchases and sales of financial assets classified in the same manner.
Page 19
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~15~ At initial recognition, financial assets are classified as financial assets measured at amortized cost, equity instruments measured at fair value through other comprehensive income, or financial assets measured at fair value through profit or loss. The consolidated company reclassifies all affected financial asset s only when it changes its business model for managing financial assets, and such reclassification is applied prospectively from the beginning of the next reporting period. (a) Financial assets measured at amortized cost A financial asset is measured at amortized cost when it meets both of the following conditions and is not designated as measured at fair value through profit or loss: ‧ The financial asset is held within a business model whose objective is to collect contractual cash flows. ‧ The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. These assets are subsequently measured at amortized cost, which is the amount at initial recognition adjusted by the cumulative amortization calculated using the effective interest method and adjusted for any loss allowance. Interest income, foreign exchange gains or losses, and impairment losses are recognized in profit or loss. Upon derecognition, the gain or loss is recognized in profit or loss. (b) Financial assets measured at fair value through other comprehensive income Debt instrument investments are measured at fair value through other comprehensive income when they meet both of the following conditions and are not designated as measured at fair value through profit or loss: ‧ The financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling the financial asset. ‧ The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. At initial recognition, the consolidated company may make an irrevocable election to present subsequent changes in the fair value of investments in equity instruments not held for trading in other comprehensive income. The above election is made on an instrument-by-instrument basis. Debt instrument investments are subsequently measured at fair value. Interest income calculated using the effective interest method, foreign exchange gains or losses, and impairment losses are recognized in profit or loss, while other net gains or losses are recognized in other comprehensive income. Upon derecognition, the cumulative amount of other comprehensive income is reclassified to profit or loss.
Page 20
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~16~ Equity instrument investments are subsequently measured at fair value. Dividend income (unless clearly representing a recovery of part of the investment cost) is recognized in profi t or loss. Other net gains or losses are recognized in other comprehensive income and are not reclassified to profit or loss. Dividend income from equity investments is recognized on the date when the consolidated company’s right to receive the dividend is established (usually the ex- dividend date). (c) Financial assets measured at fair value through profit or loss Financial assets that are not measured at amortized cost or measured at fair value through other comprehensive income as described above are measure d at fair value through profit or loss, including derivative financial assets. At initial recognition, the consolidated company may irrevocably designate financial assets that qualify for measurement at amortized cost or at fair value through other comprehensive income as financial assets at fair value through profit or loss in order to eliminate or significantly reduce an accounting mismatch. These assets are subsequently measured at fair value, and the net gains or losses (including any dividend and interest income) are recognized in profit or loss. (d) Business model assessment The consolidated company assesses the objective of the business model for holding financial assets at the portfolio level, as this best reflects how the business is managed and how information is provided to management, taking into consideration information including: ‧ The investment portfolio policies and objectives described, and the operation of those policies. This includes whether management’s strategy focuses on earning contractual cash flows, maintaining a particular interest yield portfolio, matching the duration of financial assets with the duration of related liabilities or expected cash outflows, or realizing cash flows through the sale of financial assets; ‧ The performance of the business model and how the financial assets held within that business model are evaluated and reported to the entity’s key management personnel; ‧ The risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed; ‧ The frequency, amounts, and timing of sales of financial assets in prior periods, the reasons for those sales, and expectations regarding future sales activities. Based on the aforementioned business objective, transactions in which financial assets are transferred to third parties that do not meet the derecognition criteria are not
Page 21
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~17~ considered sales as referred to above, which is consistent with the consolidated company continuing to recognize such assets. Financial assets held for trading and managed and evaluated on a fair value basis are measured at fair value through profit or loss. (e) Impairment of financial assets The consolidated company recognizes allowance for expected credit losses on financial assets measured at amortized cost (including cash and cash equivalents, financial assets measured at amortized cost, accounts and notes receivable, other receivables, refundable deposits, and other financial assets) and contract assets. The following financial assets are measured for loss allowances at an amount equal to 12- month expected credit losses, while others are measured at an amount equal to lifetime expected credit losses: ‧ The credit risk of bank deposits (that is, the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition. Loss allowances for accounts receivable and contract assets are measured at an amount equal to lifetime expected credit losses. In determining whethe r the credit risk has increased significantly since initial recognition, the consolidated company considers reasonable and supportable information that is available without undue cost or effort, including qualitative and quantitative information, as well a s analyses based on the consolidated company’s historical experience, credit assessments, and forward-looking information. Lifetime expected credit losses refer to the expected credit losses resulting from all possible default events over the expected life of a financial instrument. 12-month expected credit losses refer to the expected credit losses resulting from possible default events within twelve months after the reporting date (or a shorter period if the expected life of the financial instrument is less than twelve months). The maximum period considered in measuring expected credit losses is the longest contractual period over which the consolidated company is exposed to credit risk. Expected credit losses are the probability-weighted estimate of credit losses over the expected life of a financial instrument. Credit losses are measured as the present value of all cash shortfalls, that is, the difference between the cash flows the consolidated company is entitled to receive under the contract and the cas h flows the consolidated company expects to receive. Expected credit losses are discounted using the effective interest rate of the financial asset.
Page 22
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~18~ At each reporting date, the consolidated company assesses whether financial assets measured at amortized cost are credit-impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. Evidence that a financial asset is credit -impaired includes observable data about the following events: ‧ Significant financial difficulty of the borrower or issuer; ‧ Default, such as delinquency or past due status; ‧ The consolidated company grants concessions to the borrower that it would not otherwise consider for economi c or contractual reasons relating to the borrower’s financial difficulties; ‧ The borrower is likely to enter bankruptcy or other financial reorganization; or ‧ The disappearance of an active market for that financial asset due to financial difficulties. The loss allowance for financial assets measured at amortized cost is deducted from the carrying amount of the asset. When the consolidated company has no reasonable expectation of recovering a financial asset in whole or in part, it directly reduces the gross carrying amount of the financial asset. The consolidated company determines the timing and amount of write - offs based on an individual assessment of whether recovery can reasonably be expected. The consolidated company does not expect that amounts written off will be materially recovered. However, financial assets that have been written off may still be subject to enforcement actions in accordance with the consolidated company’s procedures for recovering overdue amounts. (f) Derecognition of Financial Assets The consolidated company derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire, or when the Company transfers the financial asset and substantially all the risks and rewards of ownership of the asset have been transferred to another entity, or when the Company neither transfers nor retains substantially all the risks an d rewards of ownership and does not retain control of the financial asset. When the consolidated company enters into transactions to transfer financial assets but retains all or substantially all the risks and rewards of ownership of the transferred assets, the assets continue to be recognized in the balance sheets.
Page 23
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~19~ b. Financial liabilities and equity instruments (a) Classification of liabilities or equity Debt and equity instruments issued by the consolidated company are classified as financial liabilities or equity based on the substance of the contractual arrangements and the definitions of financial liabilities and equity instruments. (b) Equity transactions An equity instrument refers to any contract that evidences a residual interest in the assets of the consolidated company after deducting all of its liabilities. Equity instruments issued by the consolidated company are recognized at the amount of proceeds received, net of direct issuance costs. (c) Financial liabilities Financial liabilities are classified as measured at amortized cost or measured at fair value through profit or loss. Financial liabilities are classified as measured at fair value through profit or loss if they are held for trading, are derivatives, or are designated as such at initial recognition. Financial liabilities measured at fair value through profit or loss are measured at fair value, and the related net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and exchange gains or losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss. (d) Derecognition of financial liabilities The consolidated company derecognizes a financial liability when the contractual obligation has been discharged, cancelled, or has expired. When the terms of a financial liability are modified and the cash flows of the modified liability ar e substantially different, the original financial liability is derecognized and a new financial liability is recognized at fair value based on the modified terms. Upon derecognition of a financial liability, the difference between the carrying amount and t he total consideration paid or payable (including any non- cash assets transferred or liabilities assumed) is recognized in profit or loss. (e) Offsetting of financial assets and liabilities Financial assets and financial liabilities are offset and presented on a net basis in the balance sheets only when the consolidated company currently has a legally enforceable right to offset the amounts and intends either to settle on a net basis or to realize the asset and settle the liability simultaneously.
Page 24
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~20~ (8) Inventory Inventories are measured at the lower of cost and net realizable value. Cost includes acquisition, production or processing costs and other costs incurred in bringing the inventories to their present location and condition, and is calculated using the m onthly weighted-average cost method. The cost of finished goods and work in process inventories includes manufacturing overhead allocated based on normal capacity at an appropriate proportion. Net realizable value refers to the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. (9) Property, plant and equipment a. Recognition and measurement Items of property, plant and equipment are measured at cost less accumulated depreciation and any accumulated impairment. When significant components of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment. Gains or losses on disposal of property, plant and equipment are recognized in profit or loss. b. Subsequent costs Subsequent expenditures are capitalized only when it is probable that future economic benefits will flow to the consolidated company. c. Depreciation Depreciation is calculated based on the cost of the asset less its residual value and is recognized in profit or loss using the straight -line method over the estimated useful life of each component. The estimated useful lives for the current and comparative periods are as follows: (a) Machinery and equipment 2-5 years (b) Mold equipment 2 years (c) Income-generating equipment 2-5 years (d) R&D equipment 2-5 years (e) Transport equipment 5 years (f) Lease improvement 2-5 years At each annual reporting date, the consolidated company reviews the depreciation method, useful lives, and residual values and adjusts them appropriately when necessary.
Page 25
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~21~ (10) Leases - Lessee The consolidated company assesses whether a contract is or contains a lease at the inception of the contract. A contract is or contains a lease if it conveys the right to control the use of an identified asset for a period of time in exchange for consideration. At the commencement date of the lease, the consolidated company recognizes a right-of- use asset and a lease liability. The right -of-use asset is initially measured at cost, which comprises the initial measurement of the lease liability, adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and the estimated costs of dismantling and removing the underlying asset and restoring the site on which it is located or the underlying asset itself, less any lease incentives received. Right-of-use assets are subsequently depreciated using the straight-line method from the lease commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. In addition, the consolidated company regularly assesses whether the right-of-use asset is impaired and recognizes any impairment losses that have occurred, and adjusts the right-of-use asset when the lease liability is remeasured. Lease liabilities are initially measured at the present value of the lease payments that are not paid at the lease commencement date. If th e interest rate implicit in the lease is readily determinable, that rate is used as the discount rate; if it is not readily determinable, the consolidated company’s incremental borrowing rate is used. In general, the consolidated company uses its incremental borrowing rate as the discount rate. Lease payments included in the measurement of lease liabilities comprise in -substance fixed payments; Lease liabilities are subsequently measured using the effective interest method to recognize interest and are remeasured when the following events occur: a. A change in the assessment of whether the extension or termination option will be exercised, resulting in a revision of the lease term; b. Modification of the leased asset, scope, or other terms. For lease modifications that decrease the scope of the lease, the carrying amount of the right-of-use asset is reduced to reflect the partial or full termination of the lease, and the difference between the reduction and the remeasurement of the lease liability is recognized in profit or loss. For short-term leases of small office equipment and leases of low-value underlying assets, the consolidated company elects not to recognize right -of-use assets and lease liabilities, and instead recognizes the related lease payments as expenses on a straight-line basis over the lease term.
Page 26
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~22~ (11) Intangible assets a. Recognition and measurement The consolidated company acquires intangible assets with finite useful lives, including computer software, patents, and trademarks, which are m easured at cost less accumulated amortization and accumulated impairment losses. b. Subsequent expenditure Subsequent expenditures are capitalized only when they increase the future economic benefits of the related specific asset. All other expenditures ar e recognized in profit or loss when incurred. c. Amortization Amortization is calculated based on the cost of the asset less its estimated residual value and is recognized in profit or loss using the straight -line method over its estimated useful life from the date the intangible asset becomes available for use. The estimated useful lives for the current and comparative periods are as follows: (a) Computer software and other deferred charges 1-5 years At each annual reporting date, the consolidated company reviews the amortization method, useful lives, and residual values of intangible assets and adjusts them appropriately when necessary. (12) Impairment of non-financial assets At each reporting date, the consolidated company assesses whether there is any indication that the carrying amounts of non- financial assets (excluding inventories, contract assets, and deferred tax assets) may be impaired. If any indication exists, the recoverable amount of the asset is estimated. For the purpose of impairment testing, the smallest identifiable group of assets that generates cash inflows largely independent of the cash inflows from other individual assets or groups of assets is used. The recoverable amount is the higher of an individual asset’s or cash- generating unit’s fair value less costs of disposal and its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the r isks specific to the asset or cash-generating unit. If the recoverable amount of an individual asset or cash -generating unit is less than its carrying amount, an impairment loss is recognized. Impairment losses are recognized immediately in profit or loss for the period.
Page 27
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~23~ For non-financial assets other than goodwill, impairment losses are reversed only to the extent that the carrying amount does not exceed the carrying amount that would have been determined (net of depreciation or amortization) had no impa irment loss been recognized in prior years. (13) Provision for liabilities Provisions are recognized when the consolidated company has a present obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and the amount of the obligation can be reliably estimated. Provisions are discounted using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specif ic to the liability, and the amortization of the discount is recognized as interest expense. Warranty provisions are recognized when goods or services are sold, and the provision is measured based on historical warranty data and all possible outcomes weighted by their respective probabilities. (14) Revenue recognition a. Revenue from customer contracts Revenue is measured based on the consideration that the entity expects to be entitled to in exchange for transferring goods or services. The consolidated company recognizes revenue when control of goods or services is transferred to the customer, thereby satisfying a performance obligation. The consolidated company’s principal revenue items are described as follows: (a) Sale of goods The consol idated company recognizes revenue when control of the products is transferred. The transfer of control of the product occurs when the product has been delivered to the customer, the customer has full discretion over the sales channel and price of the product, and there are no remaining obligations that could affect the customer’s acceptance of the product. Delivery occurs when the products are transported to a specified location, the risks of obsolescence and loss have been transferred to the customer, and the customer has accepted the products in accordance with the sales contract, the acceptance provisions have lapsed, or the consolidated company has objective evidence that all acceptance criteria have been satisfied. The consolidated company often provide s customers with volume discounts based on cumulative sales of products reaching a specified quantity within twelve months. The consolidated company recognizes revenue based on the contract price net of estimated volume discounts. The amount of volume discounts is estimated using the expected value
Page 28
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~24~ method based on accumulated past experience, and revenue is recognized only to the extent that it is highly probable that a significant reversal will not occur. As of the reporting date, the amount expected to be paid to customers due to quantity discounts related to sales is recognized as a refund liability. (b) Automation integration solutions Contracts for automation integration solutions include obligations to customers that involve significant integration ser vices, such as coordinating the transfer of customized equipment, installation, and system integration testing of various components, to ensure that individual goods or services are combined into the integrated output required by the customer. The Company allocates the transaction price based on the stand -alone selling price of each performance obligation. Revenue is recognized over time for services in which control is transferred continuously, and revenue is recognized at a point in time when control is transferred for items such as the delivery of equipment. If a contract does not meet the criteria for recognizing revenue over time, the consolidated company recognizes revenue and accounts receivable upon completion and acceptance of the contract as a whole. (c) Others Other revenue mainly arises from customer contracts for the provision of services, such as maintenance and repair services. Because customers simultaneously receive and consume the benefits of performance, revenue is recognized over time during the contract period. (d) Financial components The consolidated company expects that the period between the transfer of goods or services to customers and the payment by customers under all customer contracts will not exceed one year. Therefore, the cons olidated company does not adjust the transaction price for the time value of money. (15) Government grants The consolidated company recognizes government grants without attached conditions as non-operating income when they become receivable. For other grants re lated to assets, when there is reasonable assurance that the consolidated company will comply with the conditions attached to the grant and that the grant will be received, the consolidated company recognizes the grant at its nominal amount as deferred inc ome and recognizes such deferred income as other income on a systematic basis over the useful life of the asset. Government grants that compensate the consolidated company for expenses or losses incurred are recognized in profit or loss on a systematic basis in the same period as the related expenses when there is reasonable
Page 29
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~25~ assurance that the consolidated company will comply with the conditions attached to the grant and that the grant will be received. (16) Employee benefits a. Defined contribution plans The contribution obligation for defined contribution plans is recognized as an expense during the period in which employees render services. Prepaid contributions are recognized as an asset to the extent that they will lead to a cash refund or a reduction in future payments. b. Defined benefit plans The consolidated company’s net obligation under defined benefit plans is calculated separately for each plan by estimating the present value of future benefits earned by employees for services rendered in the current and prior periods and deducting the fair value of any plan assets. The defined benefit obligation is actuarially calculated each year by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the consolidated company, the recognized asset is limited to the present value of any economic benefits available in the form of refunds from the plan or reductions in future contributions to the plan. In calculating the present value of the economic benefits, any minimum funding requirements are taken into consideration. Remeasurements of the net defined benefit liability, including actuarial gains and losses, the return on plan assets (excluding interest), and any change in the effect of the asset ceiling (excluding interest), are recognized immediately in other comprehensive income and accumulated in retained earnings. The consolidated company determines the net interest expense (income) on the net defined benefit liability (asset) by applying the discount rat e determined at the beginning of the annual reporting period to the net defined benefit liability (asset) at that time. Net interest expense and other expenses related to defined benefit plans are recognized in profit or loss. When a plan amendment or curtailment occurs, the resulting change in benefits related to past service cost or the gain or loss from the curtailment is recognized immediately in profit or loss. The consolidated company recognizes settlement gains or losses of defined benefit plans when the settlement occurs. c. Short-term employee benefits Short-term employee benefit obligations are recognized as expenses when the services are rendered. If the consolidated company has a present legal or constructive obligation to make payments as a result of employees’ past services and the amount of the obligation can be reliably estimated, the amount is recognized as a liability.
Page 30
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~26~ (17) Share-based payment transactions Equity-settled share-based payment arrangements are measured at the fair value at the grant date and recognized as an expense over the vesting period of the awards, with a corresponding increase in equity. The recognized expense is adjusted based on the number of awards expected to satisfy the service conditions and non- market vesting conditions, and the amount ultimately recognized is measured based on the number of awards that satisfy the service conditions and non-market vesting conditions at the vesting date. Non-vesting conditions related to share -based payment awards are reflected in th e measurement of the fair value at the grant date of the share- based payment, and differences between expected and actual outcomes are not subject to true-up adjustments. The fair value amount of cash -settled share appreciation rights payable to employees is recognized as an expense over the period during which employees become unconditionally entitled to the remuneration, with a corresponding increase in liabilities. At each reporting date and settlement date, the liability is remeasured based on the fair value of the share appreciation rights, and any change is recognized in profit or loss. The grant dates of the consolidated company’s share -based payments are described in Note 6(20). (18) Income tax Income tax includes current and deferred income tax. Except for those related to business combinations or items recognized directly in equity or other comprehensive income, current income tax and deferred income tax are recognized in profit or loss. Current income tax includes the estimated income tax payable or ref undable calculated based on taxable income (loss) for the current year and any adjustments to income tax payable or refundable for prior years. The amount is measured as the best estimate of the amount expected to be paid or received, based on the statutor y tax rates or substantively enacted tax rates at the reporting date. Deferred income tax is recognized and measured based on the temporary differences between the carrying amounts of assets and liabilities at the reporting date and their tax bases. Deferred income tax assets are recognized for unused tax losses carried forward, unused tax credits carried forward, and deductible temporary differences to the extent that it is probable that future taxable income will be available against which they can be utilized. They are reassessed at each reporting date and reduced to the extent that the related income tax benefits are no longer probable of realization, or reversed to the extent that it becomes probable that sufficient taxable income will be available.
Page 31
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~27~ Deferred income tax is measured using the tax rates expected to apply when the temporary differences reverse, based on the statutory tax rates or substantively enacted tax rates at the reporting date. The consolidated company offsets deferred tax assets and deferred tax liabilities only when both of the following conditions are met: a. There is a legally enforceable right to offset current income tax assets and current income tax liabilities; and b. Deferred income tax assets and deferred income tax liabilities relate to income taxes levied by the same taxation authority on one of the following taxable entities: (a) The same taxable entity; or (b) Different taxable entities, but each entity intends to settle current income tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred income tax assets are expected to be recovered or deferred income tax liabilities are expected to be settled. (19) Earnings per share The consolidated company presents basic and diluted earnings per share attributable to ordinary shareholders of the Company. Basic earnings per share is calculated by dividing the profit or loss attributable to ordinary shareholders of the consolida ted company by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share is calculated by adjusting the profit or loss attributable to ordinary equity holders of the Company and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares. The consolidated company’s potential dilutive ordinary shares include employee compensation granted to employees. (20) Segment information Operating segments are components of the consolidated company that engage in business activities from which they may earn revenues and incur expenses (including revenues and expenses related to transactions with other components within the consolidated company). The operating re sults of all operating segments are regularly reviewed by the consolidated company’s chief operating decision maker to make decisions about resource allocation to the segments and to assess their performance. Each operating segment has separate financial information.
Page 32
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~28~ 5. Major sources of uncertainty in significant accounting judgments, estimates, and assumptions In preparing these consolidated financial statements, management is required to make judgments and estimates about the future (including climate-related risks and opportunities), which affect the application of accounting policies and the reported amounts of assets, liabilities, income, and expenses. Actual results may differ from estimates. Management continuously reviews the estimates and underlying assumptions, which are consistent with the consolidated company’s risk management and climate -related commitments. Changes in estimates are recognized prospectively in the period of change and in future periods affected. Information on estimation uncertain ties that have a significant risk of resulting in material adjustments in the following year is as follows: Inventory valuation As inventories are measured at the lower of cost and net realizable value, the consolidated company must apply judgment and estimates to determine the net realizable value of inventories at the end of the reporting period. The consolidated company assesses at the reporting date the amount of inventories that may have been subject to normal loss, obsolescence, or lack of market valu e, and writes down the cost of inventories to net realizable value. This inventory valuation is primarily estimated based on product demand over a specific future period and may therefore be subject to significant changes due to rapid changes in the industry. 6. Explanation of significant accounting items (1) Cash and cash equivalents 2025.12.31 2024.12.31 Petty cash $ 90 90 Demand deposits 224,796 95,350 Foreign currency deposits 118,156 192,712 Check deposits - 427 Time deposits - 23,898 Cash and Cash Equivalents Presented in the Consolidated Statement of Cash Flows $ 343,042 312,477 For the disclosure of the consolidated company’s foreign exchange risk and sensitivity analysis related to financial assets, please refer to Note 6(25).
Page 33
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~29~ (2) Financial assets and liabilities measured at fair value through profit or loss 2025.12.31 2024.12.31 Financial assets mandatorily measured at fair value through profit or loss: Beneficiary certificates - open-end funds $ 3,779,295 497,733 Preferred shares of domestic listed companies 3,770 3,779 Total $ 3,783,065 501,512 a. Preferred shares The consolidated company holds preferred shares issued by domestic listed companies. These preferred shares are non -cumulative, and dividends are distributed based on the agreed annual rate and are reset periodically according to the agreed terms. The shares have no maturity date; however, the issuing company may redeem all or p art of the issued preferred shares at the original issue price upon the expiration of the agreed period. For any shares not redeemed, the rights and obligations continue under the original issuance terms. The preferred shares held by the consolidated company are non-voting and non-convertible preferred shares. b. For other price risk and fair value information, please refer to Note 6(25). c. As of December 31, 2025 and 2024, none of the aforementioned financial assets of the consolidated company were pledged as collateral. (3) Financial assets measured at fair value through other comprehensive income 2025.12.31 2024.12.31 Equity instruments measured at fair value through other comprehensive income: Preferred shares of domestic listed companies $ 222,397 110,786 a. Preferred shares The consolidated company holds preferred shares issued by domestic listed companies. These preferred shares are non -cumulative, and dividends are distributed based on the agreed annual rate and are reset periodically according to the agreed terms. The shares have no maturity date; however, the issuing company may redeem all or part of the issued preferred shares at the original issue price upon the expiration of the agreed period. For any shares not redeemed, the rights and obligations continue under the original issuance terms. The preferred shares held by the consolidated company are non-voting and non-convertible preferred shares. b. Investments in equity instruments measured at fair value through other com prehensive income
Page 34
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~30~ The consolidated company holds these equity instrument investments as long- term strategic investments and not for trading purposes; therefore, they have been designated as measured at fair value through other comprehensive income. The consolidated company did not dispose of strategic investments during 2025 and 2024, and no cumulative gains or losses were transferred within equity during those periods. c. For other price risk and fair value information, please refer to Note 6(25). d. As of Decem ber 31, 2025 and 2024, none of the aforementioned financial assets of the consolidated company were pledged as collateral. (4) Financial assets measured at amortized cost 2025.12.31 2024.12.31 Preferred shares of domestic listed companies $ 271,234 - Debt instrument investments 1,351,782 525,818 Total $ 1,623,016 525,818 a. Debt instrument investments measured at amortized cost. The consolidated company assesses that these assets are held to collect contractual cash flows until maturity and that the cash flows of these financial assets consist solely of payments of principal and interest on the principal amount outstanding; therefore, they are presented as financial assets measured at amortized cost. b.In April 2025, the consolidat ed company purchased corporate bonds issued by Mercuries Life Insurance with a face value of NT$90,000 thousand, a coupon rate of 3.80%, and an effective interest rate of 3.74%. c. In August 2025, the consolidated company purchased Mercuries Life Insurance 2B Corporate Bonds with a face value of NT$80,000 thousand, a coupon rate of 3.80%, and an effective interest rate of 3.78%. d.In October, November, and December 2025, the consolidated company purchased TS Financial Holding Co., Ltd. Class I Preferred Shares registered preferred shares with a face value of NT$292,250 thousand and a dividend rate of 1.665%. e. In December 2025, the consolidated company purchased Fubon Life Insurance AAA Corporate Bonds with a face value of NT$600,000 thousand, a coupon rate of 3.70%, and an effective interest rate of 3.70%. f. In December 2025, the consolidated company purchased Mercuries Life Insurance 4A Corporate Bonds with a face value of NT$200,000 thousand, a coupon rate of 3.80%, and an effective interest rate of 3.80%.
Page 35
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~31~ g.In April 2024, the consolidated company purchased corporate bonds issued by Cathay Life Insurance with a face value of NT$30,000 thousand, a coupon rate of 3.70%, and an effective interest rate of 3.70%. h.In May 2024, the consolidated company purchased U.S. dolla r-denominated corporate bonds issued by Cathay Life Insurance with a face value of US$2,000 thousand, a coupon rate of 5.80%, and an effective interest rate of 5.80%. i.In August 2024, the consolidated company purchased corporate bonds issued by Shin Kong Life Insurance with a face value of NT$90,000 thousand, a coupon rate of 3.50%, and an effective interest rate of 3.49%. j.In October 2024, the consolidated company purchased Fubon Life Insurance AA Corporate Bonds with a face value of NT$80,000 thousand, a coupon rate of 3.70%, and an effective interest rate of 3.70%. k.In July 2023, the consolidated company purchased U.S. dollar-denominated corporate bonds issued by Amazon.com, Inc. with a face value of US$1,000 thousand, a coupon rate of 4.05%, and an effective interest rate of 4.80%. l.In July and August 2023, the consolidated company purchased U.S. dollar -denominated corporate bonds issued by TSMC GLOBAL LTD. with a face value of US$1,000 thousand each, with coupon rates of 2.25% and 1.375% and effective interest rates of 4.84% and 4.90%, respectively. These investments were disposed of in May 2025; for the gain or loss on disposal, please refer to Note 6(24). m.In August 2023, the consolidated company purchased U.S. dollar -denominated corporate bonds issued by TSMC Arizona Corporation with a face value of US$1,000 thousand, a coupon rate of 2.50%, and an effective interest rate of 5.02%. These investments were disposed of in May 2025; for the gain or loss on disposal, please refer to Note 6(24). n.In September 2023, the consolidated company purchased Fubon Life Insurance A Corporate Bonds with a face value of NT$90,000 thousand, a coupon rate of 3.70%, and an effective interest rate of 3.70%. o.On October 5 and October 20, 2023, the consolidated company purchase d U.S. dollar - denominated corporate bonds issued by Apple Inc. with a face value of US$1,000 thousand each, with coupon rates of 3.25% and 1.65% and effective interest rates of 4.94% and 5.23%, respectively. These investments were disposed of in May 2025; for the gain or loss on disposal, please refer to Note 6(24). p.For fair value information, please refer to Note 6(25). q.As of December 31, 2025 and 2024, none of the aforementioned financial assets of the consolidated company were pledged as collateral.
Page 36
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~32~ (5) Accounts and notes receivable 2025.12.31 2024.12.31 Notes receivable - measured at amortized cost $ 50,417 41,005 Accounts receivable - measured at amortized cost 159,525 69,971 209,942 110,976 Accounts receivable measured at amortized cost - related parties 109,067 141,508 Total $ 319,009 252,484 The consolidated company applies the simplified approach to estimate expected credit losses for all accounts and notes receivable, that is, measuring expected credit losses over the lifetime. For this purpose, such accounts and notes receivable are grouped based on shared credit risk characteristics that represent customers’ ability to pay all amounts due in accordance with the contractual terms, and forward- looking information has been incorporated. The analysis of expected credit losses for the consolidated company’s accounts and notes receivable is as follows: Accounts receivable - non-related parties 2025.12.31 Carrying amount of accounts receivable Weighted average expected credit loss rate Loss allowance for lifetime expected credit losses Not overdue $ 201,853 0% - Overdue within 90 days 6,725 0% - Overdue by more than 91 days 1,364 0% - $ 209,942 - 2024.12.31 Carrying amount of accounts receivable Weighted average expected credit loss rate Loss allowance for lifetime expected credit losses Not overdue $ 109,988 0% - Overdue within 90 days 988 0% - $ 110,976 -
Page 37
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~33~ Accounts receivable - related parties 2025.12.31 2024.12.31 Not overdue $ 100,395 117,804 Overdue within 90 days 8,672 22,665 Overdue by more than 91 days - 1,039 $ 109,067 141,508 For accounts receivable from related parties, based on historical experience and credit assessments, there has been no credit risk. The consolidated company also continuously monitors and tracks the status of overdue amounts. The movement in the allowance for losses on the consolidated compan y’s accounts receivable and notes receivable is as follows: 2025 2024 Beginning balance (equal to ending balance) $ - - For other credit risk information, please refer to Note 6(25). The consolidated company has entered into non -recourse agreements with financial institutions for the discounting of notes receivable and the sale of accounts receivable. According to the agreements, the consolidated company is not required to bear the risk of non- collection of the notes or accounts receivable, and therefore these financial assets meet the derecognition criteria. Information related to notes receivable discounting and accounts receivable sale agreements signed as of the reporting date is as follows: 2025.12.31 Counterparty Derecognized amount Prepaid amount Interest range Other important matters Financial institution $ 46,532 46,532 1.3%~2.6% None For notes receivable discounting agreements signed between the consolidated company and financial institutions, the consolidated company assesses that it still retains the risks and rewards of the notes receivable; therefore, the financial assets do not me et the derecognition criteria. Transaction-related information is as follows: 2025.12.31 Counterparty Amount of notes receivable transferred Prepaid amount (presented under short-term borrowings) Interest range Financial institution $ 50,417 50,417 1.35~2.45%
Page 38
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~34~ As of December 31, 2025 and 2024, the consolidated company’s notes receivable and accounts receivable were not pledged as collateral. (6) Other receivables 2025.12.31 2024.12.31 Other receivables $ 3,643 1,463 Interest receivable 14,211 8,153 Total $ 17,854 9,616 The above other receivables are not overdue. (7) Inventory 2025.12.31 2024.12.31 Raw materials $ 104,049 91,939 Semi-finished goods and work in process 208,183 249,594 Finished goods 154,343 146,155 Total $ 466,575 487,688 The breakdown of the consolidated company’s cost of goods sold for the years ended December 31, 2025 and 2024 is as follows: 2025 2024 Cost of sales $ 880,268 719,886 Inventory valuation and obsolescence losses (reversal gains) 12,551 (2,007) Others operating costs 278 1,935 Total $ 893,097 719,814 The consolidated company recognizes losses from inventory valuation and obsolescence when inventories are written down to net realizable value or become obsolete, and such losses are presented as operating costs. When factors that previously caused the net realizable value of inventory to fall below cost have ceased, resulting in an increase in net realizable value, the reversal gain of inventory is recognized and recorded as a reduction of cost of goods sold. As of December 31, 2025 and 2024, none of the consolidated company’s inventories were pledged as collateral. (8) Property, plant and equipment The details of changes in the cost, depreciation, and impairment losses of property, plant, and equipment of the consolidated company for the years ended December 31, 2025 and 2024 are as follows:
Page 39
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~35~ Machinery and equipment Mold equipment Transport equipment Income- generating equipment R&D equipment Lease improveme nts Total Costs: Balance as of January 1, 2025 $ 33,645 37,722 - 58,708 38,995 15,048 184,118 Add 5,480 1,602 1,450 2,803 4,672 - 16,007 Disposal and obsolescence (1,077) - - (801) (3,822) - (5,700) Effect of exchange rate changes - - - (248) (30) - (278) Balance as of December 31, 2025 $ 38,048 39,324 1,450 60,462 39,815 15,048 194,147 Balance as of January 1, 2024 $ 30,040 32,290 - 52,918 38,336 14,738 168,322 Add 4,756 5,432 - 5,411 6,446 310 22,355 Disposal and obsolescence (1,151) - - (299) (5,853) - (7,303) Effect of exchange rate changes - - - 678 66 - 744 Balance as of December 31, 2024 $ 33,645 37,722 - 58,708 38,995 15,048 184,118 Depreciation and impairment losses: Balance as of January 1, 2025 $ 23,320 22,076 - 46,938 25,532 14,425 132,291 Depreciation for the current period 5,583 9,907 74 4,338 5,711 473 26,086 Disposal and obsolescence (1,077) - - (776) (3,822) - (5,675) Effect of exchange rate changes - - - (211) (21) - (232) Balance as of December 31, 2025 $ 27,826 31,983 74 50,289 27,400 14,898 152,470 Balance as of January 1, 2024 $ 18,528 9,814 - 42,100 26,151 10,301 106,894 Depreciation for the current period 5,943 12,262 - 4,581 5,184 4,124 32,094 Disposal and obsolescence (1,151) - - (299) (5,853) - (7,303) Effect of exchange rate changes - - - 556 50 - 606 Balance as of December 31, 2024 $ 23,320 22,076 - 46,938 25,532 14,425 132,291 Book value: December 31, 2025 $ 10,222 7,341 1,376 10,173 12,415 150 41,677 January 1, 2024 $ 11,512 22,476 - 10,818 12,185 4,437 61,428 December 31, 2024 $ 10,325 15,646 - 11,770 13,463 623 51,827 As of December 31, 2025 and 2024, none of the consolidated company’s property, plant and equipment were pledged as collateral.
Page 40
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~36~ (9) Right-of-use assets The details of changes in the cost, depreciation, and impairment losses of leased land, buildings and struc tures, and transportation equipment of the consolidated company are as follows: Buildings and structures Transport equipment Total Cost of right-of-use assets: Balance as of January 1, 2025 $ 201,199 495 201,694 Add 19,911 - 19,911 Decrease (13,308) (495) (13,803) Effect of exchange rate changes (242) - (242) Balance as of December 31, 2025 $ 207,560 - 207,560 Balance as of January 1, 2024 $ 157,689 495 158,184 Add 42,838 - 42,838 Effect of exchange rate changes 672 - 672 Balance as of December 31, 2024 $ 201,199 495 201,694 Depreciation and impairment losses of right-of-use assets: Balance as of January 1, 2025 $ 123,317 358 123,675 Depreciation for the current period 39,966 137 40,103 Decrease (13,308) (495) (13,803) Effect of exchange rate changes 52 - 52 Balance as of December 31, 2025 $ 150,027 - 150,027 Balance as of January 1, 2024 $ 88,420 192 88,612 Depreciation for the current period 34,528 166 34,694 Effect of exchange rate changes 369 - 369 Balance as of December 31, 2024 $ 123,317 358 123,675 Book value: December 31, 2025 $ 57,533 - 57,533 January 1, 2024 $ 69,269 303 69,572 December 31, 2024 $ 77,882 137 78,019
Page 41
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~37~ (10) Intangible assets The details of the cost, amortization, and impairment losses of the consolidated company’s intangible assets for 2025 and 2024 are as follows: Computer software Others Total Costs: Balance as of January 1, 2025 $ 20,008 5,052 25,060 New additions for the current period 5,420 7,376 12,796 Disposition for the current period - (3,827) (3,827) Balance as of December 31, 2025 $ 25,428 8,601 34,029 Balance as of January 1, 2024 $ 12,370 3,588 15,958 New additions for the current period 8,483 3,977 12,460 Disposition for the current period (845) (2,513) (3,358) Balance as of December 31, 2024 $ 20,008 5,052 25,060 Amortization and impairment losses: Balance as of January 1, 2025 $ 11,945 2,510 14,455 Amortization for the current period 7,252 4,028 11,280 Disposition for the current period - (3,827) (3,827) Balance as of December 31, 2025 $ 19,197 2,711 21,908 Balance as of January 1, 2024 $ 7,606 1,843 9,449 Amortization for the current period 5,184 3,180 8,364 Disposition for the current period (845) (2,513) (3,358) Balance as of December 31, 2024 $ 11,945 2,510 14,455 Book value: Balance as of December 31, 2025 $ 6,231 5,890 12,121 Balance as of January 1, 2024 $ 4,764 1,745 6,509 Balance as of December 31, 2024 $ 8,063 2,542 10,605
Page 42
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~38~ (11) Other financial assets - current and non-current Details of the consolidated company’s other financial assets are as follows: 2025.12.31 2024.12.31 Time deposits over three months $ 716,323 12,981 Restricted assets - bank deposits 9,689 29,847 Refundable deposits 13,721 11,888 Others 32,538 11,969 $ 772,271 66,685 For information on the use of the above assets as collateral, please refer to Note 8. (12) Short-term borrowings Details of the consolidated company’s short-term borrowings are as follows: 2025.12.31 2024.12.31 Discounted notes receivable $ 50,417 - Interest range 1.35%~2.45% - Notes receivable discounting refers to the consolidated company endorsing and transferring certain bank acceptance bills receivable from China to banks for discounting. Some of the transferred notes receivable are converted into bank acceptance bills with lower credit ratings, so the consolidated company assesses that it still retains the risks and rewards of the notes receivable, and therefore they do not meet the derecognition criteria for financial assets. (13) Provision for liabilities - current Provision for warranty liabilities - current Balance as of January 1, 2025 $ 62,992 New additions for the current period 61,052 Write-offs for the current period (41,268) Balance as of December 31, 2025 $ 82,776 Balance as of January 1, 2024 $ 54,872 New additions for the current period 47,922 Write-offs for the current period (39,802) Balance as of December 31, 2024 $ 62,992 As of December 31, 2025 and 2024, the consolidated company’s warranty provisions are primarily related to the sale of robotic arms. The warranty provisions are estimated based on
Page 43
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~39~ historical warranty data, and the consolidated company expects these liabilities to be incurred in the one to five years following the sales. (14) Refund liabilities - current Details of the consolidated company’s refund liabilities are as follows: 2025.12.31 2024.12.31 Refund liabilities - current $ 6,798 9,631 Refund liabilities primarily represent amounts expected to be paid to customers due to quantity discounts under sales contracts. (15) Lease liabilities The carrying amounts of the consolidated company’s lease liabilities are as follows: 2025.12.31 2024.12.31 Current $ 38,152 32,791 Non-current $ 19,647 45,993 For the maturity analysis, please refer to Note 6(25) Financial Instruments. Amounts related to leases recognized in profit or loss are as follows: 2025 2024 Interest expense on lease liabilities $ 1,826 1,676 Expenses for short-term leases $ - 365 The amounts recognized in the statement of cash flows are as follows: 2025 2024 Total cash outflows for leases $ 42,439 36,396 a. Lease of buildings and structures The consolidated company leases buildings and structures for use as offices, warehouses, and factories. The lease terms are generally two to five years, and some leases include options to extend for the same period as the original contract upon expiration of the lease term. b. Other leases The lease term for the Company’s leased company vehicles is three years. The lease of office premises entered into by the consolidated company is a short -term lease. The consolidated company elects to apply the recognition exemption and therefore does not recognize the related right-of-use assets and lease liabilities.
Page 44
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~40~ (16) Deferred income 2025.12.31 2024.12.31 Deferred income - government grants $ 5,300 6,653 The consolidated company obtains government grants with related conditions arising from the purchase of equipment. Such subsidies are recognized as deferred income and amortized over the useful lives of the equipment. (17) Employee benefits a. Defined benefit plans The reconciliation of the present value of defined benefit obligations and the fair value of plan assets of the consolidated company for 2025 and 2024 is as follows: 2025.12.31 2024.12.31 Present value of defined benefit obligations $ 2,703 1,821 Fair value of plan assets (266) (176) Net defined benefit liabilities (assets) $ 2,437 1,645 The consolidated company’s defined benefit plan contributions are deposited into the labor pension reserve account at the Bank of Taiwan. Retirement payments for each employee under the Labor Standards Act are calculated based on the base amount earned according to years of service and the average salary of the six months prior to retirement. (a) Composition of planned assets The retirement fund contributed by the consolidated company in accordance with the Labor Standards Act is centrally managed by the Bureau of Labor Funds of the Ministry of Labor (hereinafter referred to as the Bureau of Labor Funds). In accordance with the “Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund,” the utilization o f the fund shall ensure that the minimum annual distribution of earnings in the final accounts is not lower than the earnings calculated based on the interest rate of two-year time deposits at local banks. As of the reporting date, the balance of the consolidated company’s labor pension reserve account at the Bank of Taiwan amounted to NT$266 thousand. Information on the utilization of the labor retirement fund assets, including fund yield and asset allocation, is available on the website of the Bureau of Labor Funds, Ministry of Labor.
Page 45
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~41~ (b) Changes in the present value of defined benefit obligations The changes in the present value of defined benefit obligations of the consolidated company for 2025 and 2024 are as follows: 2025 2024 Defined benefit obligation on January 1 $ 1,821 1,465 Service cost and interest for the current period 490 391 Remeasurements net defined benefit liabilities (assets) - Actuarial gains and losses from experience adjustments 265 68 - Actuarial gains and losses arising from changes in demographic assumptions 18 1 - Actuarial losses (gains) arising from changes in financial assumptions 109 (104) Defined benefit obligation on December 31 $ 2,703 1,821 (c) Changes in the fair value of plan assets The changes in the fair value of plan assets under the defined benefit plan of the consolidated company for 2025 and 2024 are as follows: 2025 2024 Fair value of plan assets on January 1 $ 176 106 Interest income 4 3 Remeasurements net defined benefit liabilities (assets) - Plan asset returns (excluding current-period interest) 9 6 Contributions made to the plan 77 61 Fair value of plan assets on December 31 $ 266 176 (d) Expenses recognized in profit or loss The details of expenses reported by the consolidated company for 2025 and 2024 are as follows: 2025 2024 Selling expenses $ 243 230 R&D expenses 243 158 $ 486 388
Page 46
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~42~ (e) Actuarial assumptions The significant actuarial assumptions used by the consolidated company to determine the present value of defined benefit obligations as of the end of the financial reporting period are as follows: 2025.12.31 2024.12.31 Discount rate 1.65% 1.80% Future salary increases 3.00% 3.00% The consolidated company expects to contribute NT$84 thousand to the defined benefit plan within one year after the 2025 reporting date. The weighted average remaining service period of the defined benefit plan is 28 years. (f) Sensitivity analysis The effects of changes in key actuarial assumptions adopted for the years ended December 31, 2025 and 2024 on the present value of the defined benefit obligation are as follows: Impact on the defined benefit obligations Increase by 0.25% Decrease by 0.25% December 31, 2025 Discount rate (180) 194 Future salary increases 191 (178) December 31, 2024 Discount rate (122) 132 Future salary increases 130 (121) The above sensitivity analysis examines the impact of changes in a single assumption while holding all other assumptions constant. In practice, changes in many assumptions may be interrelated. The sensitivity analysis is consistent with the method used to calculate the net pension liability in the statement of financial position. b. Defined contribution plans The consolidated company’s defined contribution plan is established in accordance with the Labor Pension Act, under which contributions are made to the individual labor pension accounts at the Bureau of Labor Insurance at a contribution rate of 6% of each employee’s monthly salary. Under this plan, once the consolidated company contributes a fixed amount to the Bureau of Labor Insurance, it has no legal or constructive obligation to pay additional amounts.
Page 47
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~43~ The pension expenses under the defined contribution pension plan of the consolidated company for 2025 and 2024 amounted to NT$19,381 thousand and NT$17,997 thousand, respectively, which have been contributed to the Bureau of Labor Insurance. c. Retirement expenses contributed by foreign subsidiaries in accordance with local regulations are as follows: Retirement expenses contributed by foreign subsidiaries in accordanc e with local regulations for the years ended December 31, 2025 and 2024 amounted to NT$11,984 thousand and NT$11,333 thousand, respectively. (18) Income tax a. Income tax expenses The details of income tax expenses of the consolidated company for 2025 and 2024 are as follows: 2025 2024 Income tax expenses in the current period Generated in the current period $ 25,202 16,771 Current income tax for prior periods adjustments (643) (840) 24,559 15,931 Deferred income tax benefit (8,341) (2,971) $ 16,218 12,960 The details of income tax (expenses) recognized under other comprehensive income of the consolidated company for 2025 and 2024 are as follows: 2025 2024 Items not reclassified to profit or loss: Remeasurements of defined benefit plans $ 76 (8)
Page 48
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~44~ The reconciliation between income tax expenses and profit before tax of the consolidated company for 2025 and 2024 is as follows: 2025 2024 Net profit before tax $ 152,588 106,735 Income tax calculated at the domestic tax rate of the consolidated company’s location $ 33,626 19,496 Permanent difference (121) (683) Tax-exempt income (3,944) (1,768) Overestimation of income tax in prior periods (643) (840) Additional tax on undistributed earnings 4,347 490 Changes in unrecognized temporary differences (3,096) 3,420 Loss carryforward deduction (3,299) - Investment tax credits (10,652) (7,155) Income tax expenses $ 16,218 12,960 b. Deferred income tax assets and liabilities (a) Unrecognized deferred income tax assets - Taiwan region 2025.12.31 2024.12.31 Unrecognized investment tax credits $ 31,645 30,202 Changes in unrecognized temporary differences 15,844 18,850 $ 47,489 49,052 As of December 31, 2025, the consolidated company’s taxable losses in the China region that have not been recognized as deferred income tax assets amounted to RMB 4,735 thousand, and the final deductible years are from 2026 to 2029.
Page 49
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~45~ (b) Recognized deferred income tax assets and liabilities The changes in deferred income tax assets and liabilities for 2025 and 2024 are as follows: Provision for warranty liabilities Inventory valuation loss Others Total Deferred income tax assets: Balance as of January 1, 2025 $ 12,598 15,224 8,395 36,217 (Debit) credit to the statement of profit or loss 3,957 2,679 552 7,188 (Debit) credit to other comprehensive income - - 76 76 Effect of exchange rate changes - - (3) (3) Balance as of December 31, 2025 $ 16,555 17,903 9,020 43,478 Balance as of January 1, 2024 $ 10,974 16,229 4,287 31,490 (Debit) credit to the statement of profit or loss 1,624 (1,005) 4,052 4,671 (Debit) credit to other comprehensive income - - (8) (8) Effect of exchange rate changes - - 64 64 Balance as of December 31, 2024 $ 12,598 15,224 8,395 36,217 Right-of-use assets Unrealized foreign exchange gains Total Deferred income tax liabilities: Balance as of January 1, 2025 $ 513 2,624 3,137 Debit (credit) to the statement of profit or loss 1,078 (2,231) (1,153) Effect of exchange rate changes (3) - (3) Balance as of December 31, 2025 $ 1,588 393 1,981 Balance as of January 1, 2024 $ 1,373 - 1,373 Debit (credit) to the statement of profit or loss (924) 2,624 1,700 Effect of exchange rate changes 64 - 64 Balance as of December 31, 2024 $ 513 2,624 3,137
Page 50
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~46~ c. Status of income tax assessments The Company’s profit-seeking enterprise income tax returns have been assessed and approved by the tax authorities through 2023. (19) Capital and other equity a. Share capital As of December 31, 2025 and 2024, the Company’s authorized share capital was NT$1,200,000 thousand, with a par value of NT$10 per share and 120,000 thousand shares, and the issued shares were 102,800 thousand shares and 90,000 thousand shares, respectively. All issued shares have been fully paid. On November 25, 2021, the Company’s extraordinary shareholders’ meeting resolved to authorize the Board of Directors to issue new ordinary shares through private placement by cash capital increase within a limit of 10,000 thousand shares within one year after the shareholders’ meeting resolution. On December 3, 2021, the Board of Directors resolved to issue 10,000 thousand ordinary shares at a private placement price of NT$60 per share, with a par value of NT$10 per share, totaling NT$600,000 thousand, with December 28, 2021 as the capital increase record date. The relevant statutory registration procedures have been completed. The delivery date of the above private placement of common shares was January 28, 2022. The three-year transfer restriction period has expired. The FSC has approved the filing for supplementary public issuance, and the TPEx has approved the application for Emerging Stock registration. Trading on the Emerging Stock market commenced on April 2, 2025. On July 15, 2025, the Company’s Board of Directors resolved to conduct a public underwriting prior to the initial listing, issuing 12,800 thousand common shares through a cash capital increase with a par value of NT$10 per share and a total issuance amount of NT$128,000 thousand. In accordance with Article 267 of the Company Act, 10% of the newly issued shares, totaling 1,280 thousand shares, were reserved for subscription by the Company’s employees, while the remaining 11,520 thousand shares were entrusted to a securities underwriter for public underwriting. Any portion waived by employees or not fully subscribed was authorized to be subscribed by specific persons as arranged by the Chairman. The Company received the full share subscription proceeds totaling NT$4,849,651 thousand on September 24, 2025, of which the premium amount was NT$4,721,651 thousand, recognized in capital surplus, with September 24, 2025 as the record date of the cash capital increase. The procedures for change registration were completed on November 5, 2025.
Page 51
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~47~ In 2025, due to the exercise of employee stock option warrants by employees, the Company received subscription proceeds at a subscription price of NT$57.2 per share. As of December 31, 2025, the cumulative total amount was NT$97,926 thousand, re cognized under advance receipts for share capital. b. Capital surplus The components of the Company’s capital surplus balance are as follows: 2025.12.31 2024.12.31 Stock issuance premium $ 5,332,890 607,561 Employee stock options 14,536 2,856 Total $ 5,347,426 610,417 According to the Company Act, capital surplus shall first be used to offset losses before realized capital surplus may be distributed to shareholders in the form of new shares or cash in proportion to their original shareholdings. The realized capital surplus referred to in the preceding paragraph includes the premium from issuing shares in excess of par value and income received from donations. According to the Regulations Governing the Offering and Issuance of Securities by Issuers, the total amount of capital surplus to be capitalized each year shall not exceed 10% of the paid-in capital. c. Retained earnings According to the Company’s Articles of Incorporation, if there are profits in the annual final accounts, taxes shall first be paid, prior years’ losses shall be offset, and 10% shall then be appropriated as legal reserve, unless the legal reserve has reached the Company’s paid- in capital. If there are still remaining profits, together with the beginning balance of undistributed earnings for the same period, the Board of Directors shall prepare a proposal for earnings distribution and submit it to the shareholders’ meeting for resolution. (a) Legal reserve When the Company has no losses, it may, upon resolution by the shareholders’ meeting, distribute new shares or cash from the legal reserve, provided that such distribution is limited to the portion of the reserve exceeding 25% of the paid-in capital. (b) Special reserve According to FSC regulations, when the Company distributes distributable earnings, it shall appropriate a special reserve in an amount equal to the net amount of deductions from other shareholders’ equity recognized in the accounts for the current year, from the current period’s profit or loss and the undistributed earnings from prior periods. For the accumulated amount of deductions from other shareholders’ equity from prior periods, a special reserve of the same amount shall be appropriated from prior period undistributed
Page 52
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~48~ earnings and shall not be distributed. Subsequently, when the amount of deductions from other shareholders’ equity is reversed, earnings may be distributed for the reversed portion. (c) Earnings distribution The Company resolved at the shareholders’ meeting on June 17, 2025 and June 21, 2024 not to distribute the earnings for 2024 and 2023, respectively. d. Other equity (net of tax) Exchange differences on translation of financial statements of foreign operations Unrealized valuation gains or losses on financial assets measured at fair value through other comprehensive income Total Balance as of January 1, 2025 $ (957) 2,546 1,589 Exchange differences arising from the translation of the net assets of foreign operations 106 - 106 Unrealized gain or loss on financial assets measured at fair value through other comprehensive income - (143) (143) Balance as of December 31, 2025 $ (851) 2,403 1,552 Balance as of January 1, 2024 $ (2,466) (58) (2,524) Exchange differences arising from the translation of the net assets of foreign operations 1,509 - 1,509 Unrealized gain or loss on financial assets measured at fair value through other comprehensive income - 2,604 2,604 Balance as of December 31, 2024 $ (957) 2,546 1,589
Page 53
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~49~ (20) Share-based payment Equity settlement Cash capital increase reserved for employee subscription Employee stock options Grant date 2025.07.15 2024.07.01 2023.11.01 Amount granted 1,280 thousand shares 1,176 thousand shares 1,824 thousand shares Contract period Immediately vested 27 months 27 months Vesting conditions Immediately vested Option holders may exercise part or all of the stock option rights within 3 months starting from the day following the second anniversary of the grant of employee stock options. Any options not exercised within the specified period after expiration shall be deemed forfeited. Option holders may exercise part or all of the stock option rights within 3 months starting from the day following the second anniversary of the grant of employee stock options. Any options not exercised within the specified period after expiration shall be deemed forfeited. a. Employee stock options (a) On August 29, 2023, the Company’s Board of Directors resolved to issue 3,000 thousand employee stock options, which became effective upon filing with the FSC, and on October 25, 2023, the Board of Directors resolved to issue them in multiple tranches.
Page 54
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~50~ (b) Measurement parameters of fair value on the grant date The consolidated company adopts the Black- Scholes option pricing model to estimate the fair value of share-based payments on the grant date. The inputs to this model are as follows: 2024.07.01 2023.11.01 Employee stock options Fair value on the grant date 4.6223 1.4073 Exercise price (Note 1) $60 $60 Expected volatility (%) 18.1883% 15.875% Duration of stock options (years) 27 months 27 months Risk-free interest rate (%) 1.3917% 1.0498% Note 1: In 2025, due to the cash capital increase, the Company adjusted the exercise price of the employee stock options to NT$57.2 in accordance with the Regulations for Issuance and Exercise of Employee Stock Options. (c) Detailed information on the above employee stock options is as follows: (Expressed in thousands) 2025 2024 Weighted average exercise price (NT$) Number of stock options Weighted average exercise price (NT$) Number of stock options Outstanding as of January 1 $ 60.00 3,000 60.00 1,824 Number granted during the current period - - 60.00 1,176 Exercised during the current period 57.20 (1,597) - - Expired during the current period 57.20 (15) - - Outstanding as of December 31 57.20 1,388 60.00 3,000 Exercisable as of December 31 57.20 212 60.00 - Information on the Company’s outstanding stock options is as follows: 2025.12.31 2024.12.31 Exercise price range (NT$) $ 57.2 - Weighted average remaining contractual term 0.083 -
Page 55
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~51~ (d) Employee expenses The expenses arising from share- based payments of the consolidated company for 2025 and 2024 are as follows: 2025 2024 Expenses arising from employee stock options $ 3,766 2,692 b. Cash capital increase reserved for employee subscription (a) On July 15, 2025, the Company’s Board of Directors resolved to issue 12,800 thousand common shares through a cash capital increase. In accordance with Article 267 of the Company Act, 10% of the shares in this cash capital increase were reserved for employee subscription. The grant date of the employee stock options was July 15, 2025, and the fair value of the stock options on the grant date was NT$9.22. (b) Measurement parameters of fair value on the grant date The consolidated company adopts the Black- Scholes option pricing model to estimate the fair value of share-based payments on the grant date. The inputs to this model are as follows: 2025.07.15 Cash capital increase reserved for employee subscription Fair value on the grant date 9.2200 Exercise price $238 Expected volatility (%) 57.020% Duration of stock options (years) Immediately vested Risk-free interest rate (%) 1.1569% (c) Employee expenses The expenses arising from share- based payments of the consolidated company for 2025 and 2024 are as follows: 2025 2024 Expenses arising from employee stock options $ 11,592 -
Page 56
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~52~ (21) Earnings per share a. Basic earnings per share (a) Net income attributable to owners of the Company’s common shares 2025 2024 Net income attributable to owners of the Company’s common shares $ 136,370 93,775 (b) Weighted average number of common shares outstanding (thousand shares) 2025 2024 Common shares outstanding as of January 1 90,000 90,000 Effect of exercising stock options 207 - Effect of issuance of new shares from cash capital increase 3,472 - Weighted average number of common shares outstanding as of December 31 93,679 90,000 b. Diluted earnings per share (a) Net income attributable to owners of the Company’s common shares 2025 2024 Net income attributable to owners of the Company’s common shares (diluted) $ 136,370 93,775 (b) Weighted average number of common shares outstanding (thousand shares) 2025 2024 Weighted average number of common shares outstanding (basic) 93,679 90,000 Effect of employee share-based remuneration 44 29 Unvested new shares for employee rights 1,170 2,138 Weighted average number of common shares outstanding (diluted) 94,893 92,167
Page 57
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~53~ (22) Revenue from customer contracts a. Disaggregation of revenue 2025 2024 Major geographic markets China $ 527,002 318,615 Taiwan 341,357 221,694 Japan 204,043 263,308 Europe 282,159 308,435 Other Countries 467,534 368,985 $ 1,822,095 1,481,037 Major product/service lines Sales of goods (robotic arms) $ 1,528,246 1,402,207 Automation integration solutions 280,539 66,998 Others 13,310 11,832 Total $ 1,822,095 1,481,037 b. Contract balance 2025.12.31 2024.12.31 2024.1.1 Contract liabilities $ 182,246 122,922 29,787 For disclosures regarding accounts receivable and notes receivable and their impairment, please refer to Note 6(5). For disclosures regarding refund liabilities, please refer to Note 6(14). Changes in contract liabilities mainly arise from the difference b etween the timing of the consolidated company transferring goods or services to customers to satisfy performance obligations and the timing of customer payments. The amounts recognized as revenue in 2025 and 2024 from the beginning balances of contract liabilities as of January 1, 2025 and 2024 were NT$61,440 thousand and NT$4,511 thousand, respectively. (23) Employee remuneration On June 17, 2025, the Company’s shareholders’ meeting resolved to amend the Articles of Incorporation. According to the amended Articles, if there are profits for the year, not less than 5% shall be appropriated as employee remuneration (of which remuneration for entry- level employees shall not be less than 10%) and not more than 3% shall be appropriated as remuneration for directors and supervisors. However, if the Company still has accumulated losses, an amount shall first be reserved to cover such losses. The recipients of employee
Page 58
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~54~ remuneration in the form of shares or cash as referred to in the preceding paragraph include employees of affiliates who meet certain conditions. According to the Articles of Incorporation prior to amendment, if there are profits for the year, not less than 5% shall be appropriated as employee remuneration and not more than 3% shall be appropriat ed as remuneration for directors and supervisors. However, if the Company still has accumulated losses, an amount shall first be reserved to cover such losses. The recipients of employee remuneration in the form of shares or cash as referred to in the preceding paragraph include employees of affiliates who meet certain conditions. The recognized amounts of employee remuneration of the Company for 2025 and 2024 were NT$12,566 thousand (of which not less than NT$1,257 thousand is entry-level employee remuneration) and NT$9,338 thousand, respectively. These amounts were estimated based on the profit before tax of the Company for the respective periods before deducting employee remuneration, after first deducting its accumulated losses, and then applying the employee remuneration distribution ratio stipulated in the Company’s Articles of Incorporation to the remaining balance. Such amounts are reported as operating costs or operating expenses for the respective periods. If there is a difference between the actual distribution amount and the estimated amount in the following year, it shall be treated as a change in accounting estimate and the difference shall be recognized in profit or loss for the following year. The aforementioned employee remuneration for 2025 has not yet been resolved for distribution by the Board of Directors; the employee remuneration for 2024 resolved for distribution by the Board of Directors does not differ from the amount estimated in the consolidated financial statements. (24) Non-operating income and expenses a. Interest income The details of interest income of the consolidated company for 2025 and 2024 are as follows: 2025 2024 Interest income from bank deposits $ 10,564 5,775 Interest income from financial assets measured at amortized cost 24,445 16,736 Other interest income - 125 $ 35,009 22,636
Page 59
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~55~ b. Other income The details of other income of the consolidated company for 2025 and 2024 are as follows: 2025 2024 Dividend income $ 4,875 4,592 c. Other gains and losses The details of other gains and losses of the consolidated company for 2025 and 2024 are as follows: 2025 2024 Gains on financial assets (liabilities) measured at fair value through profit or loss $ 16,361 8,909 Government grant income 9,486 16,444 Foreign exchange (loss) gain (21,640) 31,218 Loss on disposal of property, plant and equipment (25) - Other gains 155 2,967 Gain on disposal of financial assets measured at amortized cost 623 - $ 4,960 59,538 d. Financial costs The details of finance costs of the consolidated company for 2025 and 2024 are as follows: 2025 2024 Interest expenses $ 1,555 - Other financial expenses 1,826 1,676 Net financial costs $ 3,381 1,676 (25) Financial instruments a. Exposure to credit risk The carrying amount of financial assets represents the maximum exposure to credit risk. As of December 31, 2025 and 2024, the maximum exposure to credit risk was NT$7,080,654 thousand and NT$1,779,378 thousand, respectively. The carrying amounts of receivables from the consolidated company’s two largest customers as of December 31, 2025 and 2024 were NT$93,712 thousand and NT $104,070 thousand, respectively, accounting for 29% and 41% of total receivables, respectively, resulting in a significant concentration of credit risk for the consolidated company.
Page 60
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~56~ b. Liquidity risk The following table presents the contractual maturities of financial liabilities, including the estimated impact of interest. Carrying amount Contractual cash flows Within 6 months 6-12 months 1-2 years 2-5 years More than 5 years December 31, 2025 Non-derivative financial liabilities Short-term borrowings $ 50,417 50,417 50,417 - - - - Accounts payable 245,115 245,115 245,115 - - - - Other payables 214,679 214,679 214,679 - - - - Lease liabilities 57,799 58,900 20,916 18,128 19,856 - - $ 568,010 569,111 531,127 18,128 19,856 - - December 31, 2024 Non-derivative financial liabilities Accounts payable $ 205,256 205,256 205,256 - - - - Other payables 188,656 188,656 188,656 - - - - Lease liabilities 78,784 81,131 17,168 17,140 30,500 16,323 - $ 472,696 475,043 411,080 17,140 30,500 16,323 - The consolidated company does not expect the timing of cash flows in the maturity analysis to occur significantly earlier, nor does it expect the actual amounts to differ significantly. c. Currency risk (a) Exposure to exchange rate risk The financial assets and liabilities of the consolidated company exposed to significant foreign currency exchange rate risk are as follows: 2025.12.31 2024.12.31 Foreign currency Exchange rate NT$ Foreign currency Exchange rate NT$ Financial assets Monetary items JPY $ 729,847 0.201 146,553 343,977 0.210 72,201 USD 7,433 31.430 233,616 13,488 32.785 442,199 EUR 1,401 36.890 51,683 1,301 34.140 44,427 RMB 2,491 4.471 11,137 2,816 4.561 12,844 Financial liabilities Monetary items JPY 9,107 0.201 1,829 423 0.210 89 USD 2,171 31.430 68,225 1,048 32.785 34,373 EUR 72 36.890 2,654 44 34.140 1,531
Page 61
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~57~ (b) Sensitivity analysis The consolidated company’s exchange rate risk on monetary items mainly arises from cash and cash equivalents, other financial assets, financial assets measured at amortized cost, accounts receivable, other receivables, accounts payable, and other payables denominated in foreign currencies, resulting in foreign exchange gains or losses upon translation. As of December 31, 2025 and 2024, if NT$ had appreciated or depreciated by 5% ag ainst the consolidated company’s significant foreign currencies while all other variables remained constant, net income after tax for 2025 and 2024 would have increased by NT$14,811 thousand and NT$21,427 thousand, respectively. The analyses for both periods were prepared using the same basis. (c) Exchange gains or losses on monetary items Due to the diversity of the consolidated company’s functional currencies, information on exchange profit and loss of monetary items is disclosed on an aggregated basis. For 2025 and 2024, foreign exchange gains (including realized and unrealized) were losses of NT$21,640 thousand and gains of NT$31,218 thousand, respectively. d. Other price risk: If the price of equity securities changes at the reporting date (the analyses for both periods use the same basis and assume that other variables remain unchanged), the impact on items of comprehensive income is as follows: 2025 2024 Securities price at the reporting date Net amount of other comprehensive income after tax Profit or loss after tax Net amount of other comprehensiv e income after tax Profit or loss after tax Stocks - increase by 7% $ 15,568 264 7,755 265 Stocks - decrease by 7% $ (15,568) (264) (7,755) (265) Beneficiary certificates - increase by 1% $ - 37,793 - 4,977 Beneficiary certificates - decrease by 1% $ - (37,793) - (4,977)
Page 62
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~58~ e. Fair value information (a) Types and fair values of financial instruments The carrying amounts and fair values of the consolidated company’s financial assets and financial liabilities (including fair value hierarchy information, but excluding financial instruments for which the carrying amount is a reasonable approximation of fair value because they are not measured at fair value, and equity instrument investments without quoted prices in an active market and whose fair values cannot be reliably measured, for which disclosure of fair value information is not required in accordance with regulations) are presented as follows: 2025.12.31 Fair value Carrying amount Level 1 Level 2 Level 3 Total Financial assets measured at fair value through profit or loss Beneficiary certificates - open- end funds $ 3,779,295 3,779,295 - - 3,779,295 Preferred shares of domestic listed companies 3,770 3,770 - - 3,770 Subtotal 3,783,065 3,783,065 - - 3,783,065 Financial assets measured at fair value through other comprehensive income Preferred shares of domestic listed companies 222,397 222,397 - - 222,397 Financial assets measured at amortized cost Cash and cash equivalents 343,042 - - - - Debt instrument investments 1,351,782 - 1,351,718 - 1,351,718 Preferred shares of domestic listed companies 271,234 272,669 - - 272,669 Accounts and notes receivable 319,009 - - - - Other receivables 17,854 - - - - Other financial assets 772,271 - - - - Subtotal 3,075,192 272,669 1,351,718 - 1,624,387 Total $ 7,080,654 4,278,131 1,351,718 - 5,629,849 Financial liabilities measured at amortized cost Short-term borrowings $ 50,417 - - - - Accounts payable 245,115 - - - - Other payables 214,679 - - - - Lease liabilities 57,799 - - - - Total $ 568,010 - - - -
Page 63
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~59~ 2024.12.31 Fair value Carrying amount Level 1 Level 2 Level 3 Total Financial assets measured at fair value through profit or loss Beneficiary certificates - open- end funds $ 497,733 497,733 - - 497,733 Preferred shares of domestic listed companies 3,779 3,779 - - 3,779 Subtotal 501,512 501,512 - - 501,512 Financial assets measured at fair value through other comprehensive income Preferred shares of domestic listed companies 110,786 110,786 - - 110,786 Financial assets measured at amortized cost Cash and cash equivalents 312,477 - - - - Debt instrument investments 525,818 - 525,959 - 525,959 Accounts and notes receivable 252,484 - - - - Other receivables 9,616 - - - - Other financial assets 66,685 - - - - Subtotal 1,167,080 - 525,959 - 525,959 Total $ 1,779,378 612,298 525,959 - 1,138,257 Financial liabilities measured at amortized cost Accounts payable $ 205,256 - - - - Other payables 188,656 - - - - Lease liabilities 78,784 - - - - Total $ 472,696 - - - - (b) Valuation techniques for the fair value of financial instruments not measured at fair value The fair values of the consolidated company’s financial assets and liabilities measured at amortized cost are estimated using recent transaction prices and quoted price information or the present value of cash flows. (c) Valuation techniques for the fair value of financial instruments measured at fair value i. Non-derivative financial instruments If financial instruments have quoted prices in an active market, the quoted prices in the active market shall be used as the fair value. The market price announced by the principal exchange serves as the basis for the fair value of listed equity instruments.
Page 64
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~60~ For financial instruments held by the consolidated company that have active markets, their fair values are presented by category and nature as follows: Open-end funds, stocks of listed companies, and debt investment instruments with public markets are financial assets with standard terms and conditions traded in active markets, and their fair values are determined with reference to market quotations. ii. Derivative financial instruments Forward foreign exchange contracts are valued based on the current forward exchange rates. (d) Transfer between Level 1 and Level 2 There were no transfers between Level 1 and Level 2 during 2025 and 2024. (26) Financial risk management a. Overview The consolidated company is exposed to the following risks arising from the use of financial instruments: (a) Credit risk (b) Market risk This note presents information on the consolidated company’s exposure to the aforementioned risks, as well as the objectives, policies, and procedures adopted by the consolidated company for measuring and managing such risks. For further quantitative disclosures, please refer to the respective notes to the consolidated company’s financial statements. b. Risk management framework The consolidated company’s financial management department provides services to various business units and coordinates operations in domestic and international financial markets, monitoring and managing financial risks relate d to the consolidated company’s operations through internal risk reports that analyze exposures according to the degree and scope of risk. The use of derivative financial instruments is governed by policies approved by the Board of Directors of the consoli dated company, which provide written principles for managing foreign exchange risk, interest rate risk, credit risk, the use of derivative and non-derivative financial instruments, and the investment of surplus liquidity. Internal audit personnel continuously review compliance with policies and exposure limits. The consolidated company does not engage in transactions of financial instruments (including derivative financial instruments) for speculative purposes.
Page 65
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~61~ c. Credit risk Credit risk refers to the risk of financial loss to the consolidated company arising from a counterparty’s failure to fulfill contractual obligations under financial instruments, primarily resulting from the consolidated company’s accounts receivable from customers and investments in financial instruments. (a) Accounts receivable The policy adopted by the consolidated company is to conduct transactions only with reputable counterparties and to obtain collateral when necessary to mitigate the risk of financial loss arising from defaults . The consolidated company also uses other publicly available financial information and transaction records with each other to assess the credit ratings of major customers. The consolidated company continuously monitors credit exposure and the credit ratings of counterparties, diversifies total transaction amounts among customers with qualified credit ratings, and controls credit exposure through counterparty credit limits reviewed and approved annually by management. The consolidated company’s exposure to credit risk is mainly influenced by the individual circumstances of each customer. However, management also considers statistical data on the consolidated company’s customer base, including the default risk associated with the industries and countries in w hich the customers operate, as these factors may affect credit risk. (b) Investments The credit risk of bank deposits and other financial instruments is measured and monitored by the consolidated company’s finance department. Since the consolidated company’s counterparties and performing parties are reputable banks and financial institutions and corporate organizations with investment-grade ratings or above, there are no significant concerns regarding performance, and therefore no significant credit risk. d. Market risk Market risk refers to the risk that changes in market prices, such as exchange rates, interest rates, and equity instrument prices, will affect the consolidated company’s earnings or the value of financial instruments held by the consolidated company. The objective of market risk management is to control the level of exposure to market risk within an acceptable range and optimize investment returns. (27) Capital management The consolidated company’s capital management objective is to safeguard its ability to continue as a going concern in order to provide returns to shareholders and benefits to other stakeholders, and to maintain an optimal capital structure to reduce the cost of capital.
Page 66
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~62~ To maintain or adjust the capital structure, the consolidated company may adjust the dividends paid to shareholders, reduce capital to return funds to shareholders, issue new shares, or sell assets to repay liabilities. The consolidated company manages its capital based on the debt -to-capital ratio, consistent with industry practice. This ratio is calculated by dividing net debt by total capital. Net debt is calculated as the total liabilities presented in the balance sheet s minus cash and cash equivalents. Total capital consists of all components of equity (i.e., share capital, capital surplus, retained earnings, and other equity) plus net debt. The consolidated company’s debt-to-capital ratio as of the reporting date is as follows: 2025.12.31 2024.12.31 Total liabilities $ 878,141 699,678 Less: Cash and cash equivalents (343,042) (312,477) Net liabilities 535,099 387,201 Total equity 6,871,195 1,772,234 Total capital $ 7,406,294 2,159,435 Debt-to-capital ratio 7.22% 17.93% As of December 31, 2025, the consolidated company’s approach to capital management has not changed. (28) Investing and financing activities not affecting cash The consolidated company’s non- cash investing and financing activities for 2025 and 2024 are as follows: a. Right-of-use assets acquired through leases are detailed in Note 6(9). b. The reconciliation of liabilities arising from financing activities is presented in the table below: Non-cash changes 2025.1.1 Cash flows Others Exchange rate changes 2025.12.31 Short-term borrowings $ - 49,218 - 1,199 50,417 Lease liabilities 78,784 (40,613) 19,911 (283) 57,799 Total liabilities arising from financing activities $ 78,784 8,605 19,911 916 108,216 Non-cash changes 2024.1.1 Cash flows Others Exchange rate changes 2024.12.31 Lease liabilities $ 70,035 (34,355) 42,838 266 78,784 Total liabilities arising from financing activities $ 70,035 (34,355) 42,838 266 78,784
Page 67
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~63~ 7. Related party transactions (1) Parent company and ultimate controlling party Quanta Storage Inc. is the parent company of the Company and holds 67% of the Company’s outstanding ordinary shares. Quanta Computer Inc. is the ultimate controlling party of the group to which the Company belongs. Quanta Computer Inc. has prepared consolidated reports for public use. (2) Name of related party and relationship The related parties that had transactions with the consolidated company during the periods covered by the consolidated financial statements are as follows: Name of related party Relationship with the consolidated company Quanta Storage Inc. (QSI) Parent company Techman Electronics (Thailand) Co., Ltd. (TMT) Subsidiary of the parent company Quanta Storage (Shanghai) Ltd. (QSS) 〞 Quanta Computer Inc. The Company’s ultimate parent company Tech-Com (Shanghai) Computer Co., Ltd. (TCC) Affiliated company Tech-Front (Shanghai) Computer Co., Ltd. (TFC) 〞 Tech-Front (Chongqing) Computer Co., Ltd. (TFQ) 〞 Quanta Cloud Technology Germany GmbH(QCTG) 〞 QMB Co., Ltd. (QMB) 〞 QMH Computer Co., Ltd. (QMH) 〞 Omron Robotics and Safety Technologies Inc. (ORT) Other related parties of the Company’s directors Omron Corporation (OMC) 〞 Omron Taiwan Electronics Inc. (OTE) 〞 aetherAI Co., Ltd. (AEAI) Other related parties of the ultimate parent company
Page 68
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~64~ (3) Significant transactions with related parties a. Sales The significant sales amounts of the consolidated company to related parties are as follows: 2025 2024 TMT $ 48,182 36,335 QSS 6,818 15,247 QCI 32,431 31,558 TCC 9,870 16,425 TFQ 2,934 3,244 ORT 328,387 393,189 OMC 79,403 146,166 Affiliated company 10,369 3,074 $ 518,394 645,238 There are no other comparable transaction counterparts for the above sales, and the prices are determined through negotiation. b. Accounts receivable - related parties The details of amounts receivable from related parties of the consolidated company are as follows: Recognized items Type of related party 2025.12.31 2024.12.31 Accounts receivable TMT $ 27,089 8,080 〞 QSS 1,674 8,824 〞 QCI 13,486 32,037 〞 TCC 5,902 3,867 〞 TFQ 147 275 〞 ORT 47,788 62,394 〞 OMC 11,337 26,031 〞 Affiliated company 1,644 - $ 109,067 141,508 No collateral has been received for receivables from related parties, and no impairment loss is required after assessment. c. Accounts payable - related parties The details of amounts payable from related parties of the consolidated company are as follows:
Page 69
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~65~ Recognized items Type of related party 2025.12.31 2024.12.31 Other payables QSI $ 136 121 〞 QSS 73 179 $ 209 300 d. Others Recognized items Type of related party 2025 2024 Manufacturing expenses QSI $ 44 - Sales expenses QSS 455 509 QSI 44 - TFQ 110 - Administrative expenses QSI 228 412 TFQ - 114 R&D expenses QSI 105 - OTE 2,482 - Other gains Affiliated company - 12 e. Endorsement and guarantees As of December 31, 2024, the related party Quanta Storage (Shanghai) Ltd. (QSS) provided endorsement and guarantee for Techman Robot (Shanghai) Ltd. The guaranteed endorsement and guarantee amount was NT$5,838 thousand, and the utilized endorsement and guarantee amount was NT$0. On March 13, 2025, the Company provided endorsement and guarantee for Techman Robot (Shanghai) Ltd. upon approval by the Chairman in accordance with the “Procedures for Loaning Funds and Making Endorsements and Guarantees.” The guaranteed endorsement and guarantee amount was NT$5,724 thousand, and the utilized endorsement and guarantee amount was NT$0. This endorsement / guarantee was subsequently ratified by the Audit Committee and the Board of Directors on March 31, 2025. (4) Transactions with key management personnel Key management personnel remuneration includes: 2025 2024 Short-term employee benefits $ 34,698 23,263 Post-employment benefits 648 405 $ 35,346 23,668
Page 70
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~66~ 8. Pledged assets The details of the carrying amounts of assets pledged as collateral by the consolidated company are as follows: Name of assets Assets pledged as collateral 2025.12.31 2024.12.31 Other financial assets - Current Restricted deposits and pledged time deposits $ 9,689 29,847 Other financial assets - non- current Deposits and guarantee deposits 13,721 11,888 $ 23,410 41,735 9. Significant contingent liabilities and unrecognized contractual commitments Significant unrecognized contractual commitments: a. Due to performance guarantees under government subsidy contracts, the Company has obtained guarantee letters issued by banks to the contract counterparties: 2025.12.31 2024.12.31 Performance guarantee letters issued TWD $ 7,255 22,062 b. Guarantee promissory notes issued by the Company for purchases, borrowings, and export bill negotiations: 2025.12.31 2024.12.31 Guarantee notes issued for deposits paid TWD $ 242,600 117,426 USD $ - 10,000 10. Significant disaster losses: None. 11. Significant subsequent events (1) For the employee stock option warrants first issued by the consolidated company in 2023, as of January 31, 2026, the holders had subscribed for 1,809 thousand ordinary shares, with a par value of NT$10 per share and a subscription price of NT$57.2 per share. Total advance receipts for share capital amounted to NT$103,475 thousand. On February 3, 2026, the Board of Directors resolved to set Februar y 3, 2026 as the capital increase record date, and the Company plans to proceed with the relevant procedures for a cash capital increase in accordance with the law. (2) On January 26, 2025, the consolidated company injected capital into its subsidiary TECHMAN ROBOT GLOBAL INVESTMENT LIMITED (TRG) in the amount of USD 50,000 thousand (equivalent to NT$1,580,410 thousand).
Page 71
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~67~ 12. Others Employee benefits, depreciation, depletion, and amortization expenses summarized by function are as follows: By function 2025 2024 By nature Cost of Sale Operating Expenses Total Cost of Sale Operating Expenses Total Employee benefit Salary 66,892 463,989 530,881 61,479 416,931 478,410 Labor and health insurance 6,833 34,798 41,631 6,008 30,293 36,301 Pension 2,766 29,085 31,851 2,544 27,174 29,718 Other employee benefit 3,332 15,345 18,677 3,360 15,327 18,687 Depreciation 22,963 43,226 66,189 19,999 46,789 66,788 Amortization - 11,280 11,280 - 8,364 8,364 13. Matters disclosed in the notes (1) Information on significant transactions For 2025, the significant transaction information that the consolidated company is required to disclose in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers is as follows: a. Loans to others: None. b. Endorsement and guarantees for others: Unit: NT$ thousands No. Name of the endorsin g and guarante eing company Endorsed and guaranteed party Limit on endorseme nts and guarantees for a single enterprise Highest balance of endorsem ents and guarantee s during the period Ending balance of endorseme nts and guarantees Amount actually utilized Amount of endorsemen ts and guarantees secured by pledged assets Ratio of the cumulative endorsement and guarantee amount to the net worth in the most recent financial statements Maximum limit for endorseme nts and guarantees Endorseme nts and guarantees by the parent company for subsidiaries Endorsem ents and guarantees provided by subsidiarie s to the parent company Endorsem ents and guarantees provided to entities in China Name of company Relati onship 0 Techman Robot Inc. Techman Robot (Shanghai) Ltd. 2 1,374,239 5,724 5,724 - - 0.08% 2,748,478 Yes No Yes Note 1: The description for the numbering column are as follows: 1.The Company inputs 0. 2.The investee companies are numbered sequentially by company starting from Arabic numeral 1, and the same company should use the same code. Note 2: The calculation method for the limit is as follows: 1.The total amount of endorsements and guarantees provided by the Company to external parties shall not exceed 40% of the net worth for the current period. The limit on endorsements and guarantees for a single enterprise shall not exceed 20% of the net worth for the current period for subsidiaries in which the Company directly holds 100% of the voting shares, and shall not exceed 10% of the net worth for the current period for all others. 2.The total amount of endorsements and guarantees that the Company and its subsidiaries may provide shall not exceed 40% of the current net worth, and the limit for endorsements and guarantees provided to a single enterprise shall not exceed 20% of the current net worth. Note 3: There are seven types of relationships between the endorsing and guaranteeing party and the endorsed and guaranteed party. Only the t ype needs to be indicated: 1.A company with which there are business transactions. 2.A company in which the Company directly or indirectly holds more than 50% of the voting shares. 3.A company that directly or indirectly holds more than 50% of the voting shares of the Company. 4.Between companies in which the Company directly and indirectly holds 90% or more of the voting shares. 5.Companies in the same industry or joint developers that provide mutual guarantees in accordance with contractual provisions due to contra cting needs. 6.A company for which all investing shareholders provide endorsements and guarantees in proportion to their shareholding due to a joint investment relationship. 7.Joint and several guarantees for performance guarantees of pre -sale housing sales contracts undertaken between companies in the same industry in accordance with consumer protection regulations. Note 4: The above transactions with consolidated entities have been eliminated in the preparation of the consolidated financi al statements.
Page 72
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~68~ c. Significant marketable securities held at the end of the period (excluding investments in subsidiaries, affiliates, and joint ventures): Unit: NT$ thousands Company held Type and name of securities Relationship with the issuer of the securities Recognized accounts Ending Highest shareholding or capital contribution during the period Remarks Number of shares Carrying amount Shareholdi ng ratio Fair value Beneficiary certificates open-end funds The Company Taishin 1699 Money Market Fund - Financial assets mandatorily measured at fair value through profit or loss - current 35,062,622 503,829 - % 503,829 - % 〞 Fubon Chi-Hsiang Money Market Fund - 〞 4,845,284 80,332 - % 80,332 - % 〞 UPAMC James Bond Money Market Fund - 〞 158,197,565 2,794,085 - % 2,794,085 - % 〞 Fubon Money Market Fund - 〞 25,530,394 401,049 - % 401,049 - % Preferred shares 〞 KGI Financial Holding Co., Ltd. Preferred B Share - Financial assets mandatorily measured at fair value through profit or loss - current 479,000 3,770 - % 3,770 - % 〞 Fubon Financial Holdings Preferred A Shares - Financial assets measured at fair value through other comprehensive income - current 892,000 56,464 - % 56,464 - % 〞 Cathay FHC Preferred A Shares - 〞 2,367,000 143,677 - % 143,677 - % 〞 KGI Financial Holding Co., Ltd. Preferred B Share - 〞 2,828,000 22,256 - % 22,256 - % Debt instrument investments The Company Fubon Life Insurance 2023 First Issue Unsecured Cumulative Subordinated Corporate Bonds - Financial assets measured at amortized cost - non- current - 90,000 - % 91,472 - % 〞 Amazon.com, Inc. USD- denominated Corporate Bonds - 〞 - 28,267 - % 25,736 - % 〞 Cathy Life Insurance Ordinary Corporate Bonds - 〞 - 30,000 - % 30,200 - % 〞 Cathay Life Insurance USD- denominated Corporate Bonds - 〞 - 62,860 - % 62,838 - % 〞 Shin Kong Life Insurance Ordinary Corporate Bonds - 〞 - 90,079 - % 89,996 - % 〞 Fubon Life Insurance 2024 Second Issue Unsecured Cumulative Subordinated Corporate Bonds - 〞 - 80,000 - % 80,407 - % 〞 Mercuries Life Insurance 2025 First Issue Unsecured Cumulative Subordinated Corporate Bonds - 〞 - 90,422 - % 91,001 - % 〞 Mercuries Life Insurance 2025 Second Issue Ordinary Corporate Bonds - 〞 - 80,154 - % 79,986 - % 〞 Fubon Life Insurance 2025 Third Issue Unsecured Cumulative Subordinated Corporate Bonds - 〞 - 600,000 - % 600,063 - % 〞 Mercuries Life Insurance Co., Ltd. 2025 Fourth Issue Secured Cumulative Subordinated Ordinary Corporate Bonds - 〞 - 200,000 - % 200,019 - % Preferred shares 〞 TS Financial Holding Class I Preferred Shares - 〞 29,225,000 271,234 - % 272,669 - %
Page 73
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~69~ d. Purchases from and sales to related parties reaching NT$100 million or 20% or more of paid-in capital: Unit: NT$ thousands Transaction status Circumstances and reasons for transactions conducted under terms different from normal transactions Notes and accounts receivable (payable) Purchasing (selling) company Name of the transaction counterparty Relationship Purchase (sales) Amount Ratio to total purchases (sales) Credit period Unit price Credit period Balance Ratio to total notes and accounts receivable (payable) Rema rks The Company ORT Other related parties of the Company’s directors Sales (328,387) (19.55)% 60 days after month-end closing - 47,788 22.34% The Company TRS Subsidiaries Sales (352,267) (20.97)% 120 days after month-end closing - 113,248 52.95% TRS The Company Parent company Purchase 352,267 97.98% 120 days after month-end closing - (113,248) (94.31)% Note 1: The above purchase and sales prices and transaction terms cannot be compared with those of other counterparties. Note 2: The above transactions have been eliminated in the preparation of the consolidated financial statements. e. Amounts receivable from related parties reaching NT$100 million or 20% or more of paid- in capital: Unit: NT$ thousands Company recognizing accounts receivable Transaction counterparty Relationship Balance of accounts receivable - related parties Turnover rate Overdue receivable - related parties Amount of accounts receivable collected after the end of the period - related parties Amount of allowance for losses recognized Amount Handling method The Company TRS Subsidiaries 113,248 2.77 - - - Note: The above transactions related to consolidated entities have been eliminated in the preparation of the consolidated financial statements. f. Business relationships and significant intercompany transactions between the parent company and subsidiaries: Relation ship with the transacti on party Transaction status No. Name of the transaction party Transaction counterparty Accounts Amount Transaction conditions Ratio to consolidated total operating revenue or total assets 0 The Company TRS 1 Sales 352,267 No other transaction counterparts are available for comparison 19% 0 〞 〞 1 Accounts receivable 113,248 〞 1% Note 1: The numbering method is as follows: 1.0 represents the parent company. 2.Subsidiaries are numbered sequentially by company starting from Arabic numeral 1. Note 2: The types of relationships with the transacting party are indicated as follows: 1. Parent company to subsidiary. 2. Subsidiary to parent company. 3. Subsidiary to subsidiary. Note 3: The calculation of the ratio of transaction amounts to consolidated total operating revenue or total assets is as fol lows: if it relates to balance sheet accounts, it is calculated based on the ending balance as a percentage of consolidated total assets; if it relates to profit or loss accounts, it is calculated based on the accumulated amount during the period as a percentage of consolidated total operating revenue. Note 4: Other business relationships and significant intercompany transactions between the parent company and subsidiaries that do not reach 1% of consolidated total operating revenue or total assets are not disclosed. Note 5: The above transactions have been eliminated in the preparation of the consolidated financial statements.
Page 74
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~70~ (2) Information on investee enterprises: For 2025, the information on the consolidated company’s investee enterprises is as follows (excluding investee companies in China): Unit: NT$ thousands Name of investee company Name of invested company Location Main business activities Original investment amount Holdings at the end of the period Highest shareholding or capital contribution during the period Profit or loss of the invested company for the current period Investment profit or loss recognized for the current period End of the period End of last year Number of shares Ratio Carrying amount Remarks The Company TRH Hong Kong Investment businesses 120,943 120,943 4,000,000 100.00% 17,765 100.00% 15,028 15,028 Subsidiaries Note 1: The above transactions have been eliminated in the preparation of the consolidated financial statements. Note 2: The difference between the ending balance and the net equity value is mainly due to unrealized gross profit from sales. (3) Information on investment in China: a. Information on enterprises invested in China: Unit: NT$ thousands Name of invested company in China Main business activities Paid-in capital Investm ent method Accumulated investment remitted from Taiwan at the beginning of the current period Investment amount remitted or repatriated during the current period Accumulated investment remitted from Taiwan at the end of the current period Profit or loss of the invested company for the current period Shareholding ratio of the Company’s direct or indirect investment Highest shareholding or capital contribution during the period Investmen t profit or loss recognized for the current period (Note 2) Book value of investmen t at the end of the period Investmen t income repatriate d as of the end of the current period Remit Recover y Techman Robot (Shanghai) Ltd. Maintenance and sales of industrial collaborative robots and related components 125,720 (USD4,000) (II) 125,720 (USD4,000) - - 125,720 (USD4,000) 15,028 100.00% 100.00% 15,028 40,865 - b. Limit on investment in China: Name of company Accumulated investment amount remitted from Taiwan to China at the end of the current period Investment amounts authorized by Department of Investment Review,MOEA Limitation on investment in China authorized by Department of Investment Review,MOEA The Company 125,720 (USD 4,000 ) 125,720 (USD 4,000 ) 4,122,717 Note 1: The investment methods are classified into the following four types: 1.Investment in China companies through remittance via a third region. 2.Investment in China companies through establishing a company in a third region and then reinvesting. 3.Investment in China companies through reinvestment in an existing company in a third region. 4.Direct investment in China. 5.Other methods. Note 2: The investment profit or loss recognized for the current period is based on: 1.Under preparation and no investment profit or loss has been recognized. 2.The basis for recognizing investment profit or loss is classified into the following three types: (1) Financial statements audited and attested by an international accounting firm that has a cooperative relationship with a CPA firm in Taiwan. (2) Financial statements audited by the CPA of the Taiwan parent company. (3) Others. Note 3: The limit is 60% of net worth or consolidated net worth, whichever is higher. Note 4: Foreign currency amounts are translated into NT$ at the exchange rate on the balance sheet date. c. Significant transactions: For 2025, the significant transactions between the consolidated company and its investee companies in China, whether conducted directly or indirectly (which have been eliminated in the preparation of the consolidated report), are detailed in the explanation of “Information on Significant Transactions”.
Page 75
Notes to the Consolidated Financial Statements of Techman Robot Inc. and Subsidiaries ~71~ 14. Segment information (1) General Information The consolidated company has only one reportable operating segment, which is primarily engaged in the manufacturing, sales, and warranty repair of robotic arms. (2) Information by product and service categories Information on revenue from external customers of the consolidated company is as follows: Name of product and service 2025 2024 Sales of goods (robotic arms) $ 1,528,246 1,402,207 Automation integration solutions 280,539 66,998 Others 13,310 11,832 $ 1,822,095 1,481,037 (3) Information by geographic area Information by geographic area of the consolidated company is as follows. Revenue is classified based on the geographic location of customers, while non- current assets are classified based on the geographic location of the assets. By region 2025 2024 Revenue from external customers: China $ 527,002 318,615 Taiwan 341,357 221,694 Japan 204,043 263,308 Europe 282,159 308,435 Other Countries 467,534 368,985 $ 1,822,095 1,481,037 By region 2025.12.31 2024.12.31 Non-current assets: Taiwan $ 115,545 143,368 China 10,268 4,883 $ 125,813 148,251 Non-current assets include property, plant and equipment, intangible assets, right -of-use assets, prepayments for equipment, and other assets, but exclude financial instruments and deferred income tax assets. (4) Information on major customers 2025 2024 Customer A $ 407,790 539,355