TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
March 2026
Section I. Important Statements, Contents & Terms
The Board of Directors, the Supervisory Committee as well as all directors, supervisors and
senior management staff of Tsann Kuen (China) Enterprise Co., Ltd. (hereinafter referred to as “the
Company”) warrant that this Report is factual, accurate and complete without any false information,
misleading statements or material omissions. And they shall be jointly and severally liable for that.
Cai Yuansong, company principal, and Wu Jianhua, head of the accounting work & the
accounting division (head of accounting) jointly declare that the financial statements carried in this
Report are factual, accurate and complete.
All directors have attended the board meeting to review this report.
Any forward-looking statement such as those involving the future operational plans in this
Report shall not be considered as virtual promises of the Company to investors. And investors are
kindly reminded to pay attention to possible risks.
The Company’s profit distribution preplan upon review and approval of this board meeting:
Based on the total 185,391,680 shares, a cash dividend of RMB 1.0 (tax included) will be
distributed for every 10 shares held by shareholders. No bonus shares will be granted and no capital
reserve will be turned into share capital.
This Report is prepared in both Chinese and English. Should there be any discrepancy
between the two versions, the Chinese version shall prevail.
Contents
Documents Available for Reference
accounting work & the accounting division (head of accounting) of the Company;
CPAs; and
the website designated by the CSRC in the reporting period.
Terms
Term Refers to Content
Xiamen Tsann Kuen, MCKB, Company,
Refers to Tsann Kuen (China) Enterprise Co., Ltd.
the Company, TKC
Tsann Kuen Zhangzhou, TKL Refers to Tsann Kuen (Zhangzhou) Enterprise Co., Ltd.
Tsann Kuen Shanghai, TKS Refers to Tsann Kuen China (Shanghai) Enterprise Co., Ltd.
East Sino Development Refers to East Sino Development Limited
SCI Refers to Pt.Star Comgistic Indonesia
Orient Star Investments Refers to Orient Star Investments Limited
SCPDI Refers to Pt.Star Comgistic Property Development Indonesia
TKW Refers to Xiamen Tsannkuen Property Services Co., Ltd.
Yuan Refers to RMB Yuan
Section II. Company Profile & Financial Highlights
I. Basic information of the Company
Stock name TKC-B Stock code 200512
Stock exchange Shenzhen Stock Exchange
Company name in 厦门灿坤实业股份有限公司
Chinese
Abbr. 闽灿坤
Company name in TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
English
Abbr. TKC
Legal representative Cai Yuansong
Registered address No.88 Xinglong Road, Huli Industrial Park, Xiamen, Fujian Province, P.R. China
Zip code 361006
Office address TSANN KUEN Industrial Park, Taiwanese Investment Zone, Zhangzhou, Fujian
Province
Zip code 363107
Internet website www.eupa.cn
Email address mm_sun@tk-eupa.com
II. Contact us
Board Secretary Securities Representative
Name Sun Meimei Dong Yuanyuan
TSANN KUEN Industrial Park, TSANN KUEN Industrial Park, Taiwanese
Contact address Taiwanese Investment Zone, Zhangzhou, Investment Zone, Zhangzhou, Fujian
Fujian Province Province
Tel. 0596-6268161 0596-6268103
Fax 0596-6268104 0596-6268104
E-mail address mm_sun@tk-eupa.com yy_dong@tk-eupa.com
III. About information disclosure and where this Report is placed
Stock exchange website where this Report is disclosed Shenzhen Stock Exchange http://www.szse.cn
Media and website where this Report is disclosed Securities Times (domestic) www.cninfo.com.cn
TSANN KUEN Industrial Park, Taiwanese
Where this Report is placed
Investment Zone, Zhangzhou, Fujian Province
IV. Changes in the registered information
Unified Social Credit Code 91350200612002170L
Changes of the main business since listing No changes
Changes of the controlling shareholder No changes
V. Other information
The CPAs firm hired by the Company:
Name BDO China Shu Lun Pan Certified Public Accountants LLP
Office address
District, Xiamen, Fujian Province
Signing CPAs Hu Jingdong, Li Puqi
Sponsor engaged by the Company to conduct sustained supervision during the reporting period
Applicable Inapplicable
Financial consultant engaged by the Company to conduct sustained supervision during the
reporting period
Applicable Inapplicable
VI. Accounting and financial highlights
Does the Company adjust retrospectively or restate accounting data of previous years?
Yes No
Unit: Yuan
Year-on-year
change (%)
Operating revenue (RMB) 1,344,775,556.24 1,701,115,450.56 -20.95 1,495,632,805.41
Net profit attributable to
shareholders of the listed 23,545,319.37 72,782,642.48 -67.65 87,937,274.85
company (RMB)
Net profit attributable to
shareholders of the listed
company (excluding non-
recurring items) (in yuan)
Net cash flow from operating
-14,987,121.90 136,383,412.09 -110.99 123,045,935.61
activities (RMB)
Basic earnings per share
(RMB/share)
Year-on-year
change (%)
Diluted earnings per share
(RMB/share)
weighted average return on equity 2.15 6.71 -4.56 8.35
Increase or
decrease from
By the end of 2025 End of 2024 End of 2023
the end of last
year (%)
Total Assets (RMB) 2,454,688,092.64 2,635,048,828.74 -6.84 2,590,275,267.50
Net assets attributable to
shareholders of the listed 1,089,608,939.40 1,102,399,642.68 -1.16 1,074,939,227.19
company (RMB)
The lower of the company's net profit before and after extraordinary gains and losses in the last
three fiscal years was negative, and the audit report of the last year shows that the company's ability
to continue as a going concern is uncertain
Yes No
Whether the lower of the net profit attributable to shareholders of the Company before and after
extraordinary gains and losses was negative
Yes No
Total shares of the Company as at closure of the last trading day before the disclosure of this Report:
Total share capital (in shares) as of the close of the
previous trading day
Fully diluted EPS based on the latest total shares:
dividend paid on preferred stock 0
Interest on perpetual bonds paid (RMB) 0
Earnings per diluted share (RMB/share) calculated
based on the latest share capital
VII. Differences between accounting data under domestic and overseas
accounting standards
international and Chinese accounting standards
Applicable Inapplicable
overseas and Chinese accounting standards
Applicable Inapplicable
VIII. Key Financial Indicators by Quarter
Unit: Yuan
First Quarter Second Quarter Third Quarter Fourth Quarter
Operating revenue 369,535,852.85 283,237,443.54 397,559,843.75 294,442,416.10
Net profit attributable to
shareholders of the listed 11,735,739.16 4,265,249.49 7,309,816.42 234,514.30
company
Net profit attributable to
shareholders of the listed
company after deducting non-
recurring gains and losses
Net cash flow from operating
-5,174,887.06 -25,071,981.41 -31,475,651.75 46,735,398.32
activities
Do the aforementioned financial indicators or their aggregate values show significant discrepancies
compared to the disclosed financial metrics in the company's quarterly and semi-annual reports?
Yes No
IX. Extraordinary gains and losses
Applicable Inapplicable
Unit: Yuan
Item Amount for 2025 Amount for 2024 Amount for 2023 explain
Gain or loss on disposal of non-current
assets (including write-down portion of 756,104.15 12,195,899.75
impairment provision)
Government grants recognized in
current period profit and loss (excluding
those that are closely related to the
company's normal business operations,
comply with national policies, are
received according to established
standards, and have a lasting impact on
the company's financial results)
Excluding effective hedging activities
related to the company's normal
operations, the fair value changes in
financial assets and liabilities held by -1,401,348.54 13,046,390.84 18,116,561.09
non-financial enterprises, as well as
gains or losses from the disposal of such
assets and liabilities.
Funds occupied charge for non financial
enterprises included in current profit and
loss
Profit or loss on investment or
management of assets entrusted to
others
Item Amount for 2025 Amount for 2024 Amount for 2023 explain
Profit and loss from entrusted loan
Loss of assets due to force majeure,
such as natural disasters
Reversal of impairment provision for
receivables tested separately
The investment cost of acquiring
subsidiaries, associated enterprises, and
joint ventures is lower than the fair
value of the identifiable net assets of the
investee at the time of acquisition.
Net profit or loss of a subsidiary from
the beginning of the period to the date of
consolidation under the same control
Non monetary assets exchange gain or
loss
Profit and loss on debt restructuring
One-time expense incurred by an
enterprise due to the discontinuation of
related business activities, such as
expenses for employee resettlement
One-time effect on current profit and
loss due to adjustments in tax,
accounting, and other laws and
regulations
One-time recognition of share-based
payment expenses due to cancellation or
modification of equity incentive plans
Gain or loss from fair value changes in
employee compensation payable after
the vesting date for cash-based share-
Based payments
Profit or loss from fair value changes of
investment property measured at fair
value
Unfair gain from transaction
Gain or loss from contingent matters
unrelated to the company's normal
business operations
Trust income
Non operating income and expenses
other than those specified above
Other items of profit and loss
conforming to the definition of non- 0.00 0.00 128,459.45
recurring profit and loss
Net of income tax effect 1,264,519.35 2,829,059.30 6,566,012.29
Minority interest impact after tax 1,720,848.00 3,999,429.08 9,385,520.75
Amount to 5,352,746.40 9,849,628.33 23,731,886.15
Details of other items meeting the definition of non-recurring gains and losses:
Applicable Inapplicable
The company has no other specific items of income or expenses that meet the definition of non-
recurring gains or losses.
A Statement on Defining Non-recurring Profit and Loss Items Listed in the Interpretative
Announcement No.1 of Information Disclosure for Companies Issuing Securities to the Public-
Non-recurring Profit and Loss
Applicable Inapplicable
Section III. Management Discussion & Analysis
I. Main Business Activities of the Company During the Reporting Period
During the reporting period, the company's core business involved the development,
production, and manufacturing of small household appliances in categories such as gourmet
cooking, home helpers, and tea/coffee products. It also designed and manufactured molds for these
products, marketed its manufactured goods both domestically and internationally, and provided
after-sales services. The company's business model remained largely unchanged throughout the
reporting period.
II. Industry Landscape of the Company During the Reporting Period
In 2025, the global economy will continue to grow at a low rate, with diverging growth rates
among major economies. Under the intertwined impact of multiple factors such as tariff policy
shocks, the Federal Reserve's slower-than-expected interest rate cuts, slowing global inflation,
frequent geopolitical conflicts, deep restructuring of industrial chains, and sharp fluctuations in
commodity prices, the uncertainty of the international trade environment has significantly increased.
Against this backdrop, although China's small household appliance industry has demonstrated
strong resilience, overall export pressures remain evident. Affected by high tariff barriers in the U.S.
market, extended overseas inventory digestion cycles, and the high base effect from the same
period last year, the cumulative exports of small household appliances in 2025 have shown a
"double decline in both volume and value" situation.
In the international market, regional differentiation has further intensified. The North
American market, weighed down by high tariffs and cautious consumer sentiment, saw weak
overall demand, though household cleaning and health care products still stood out structurally. In
Europe, driven by the EU Carbon Border Adjustment Mechanism, stricter energy efficiency
labeling, and green procurement standards, demand for low-carbon, smart, and high-efficiency
products continued to rise, with green-certified products gaining easier access and premium pricing.
The Asia-Pacific region performed relatively steadily, as regional green standards alignment
accelerated under the RCEP framework. Mexico, ASEAN, and some Middle Eastern countries, due
to "export competition" or local production shortages, boosted the phased growth of China's small
appliance components and complete appliance exports. Notably, global consumers increasingly
favor "smart + low-carbon" products—small appliances with IoT capabilities, AI-powered energy-
saving algorithms, and carbon footprint disclosure labels can command favorable price premiums
in high-end markets in Europe and America.
In the domestic market, despite the pressure of high base effects during the same period, the
annual market size saw a slight year-on-year decline, yet structural opportunities remain significant.
In 2025, the Chinese government officially included kitchen appliances like rice cookers and
microwaves in the "trade-in" policy subsidy program, effectively stimulating demand for product
upgrades and quality improvements. Consumer behavior has become highly stratified: Gen Z and
the new middle class prefer smart products that integrate AI interaction, remote control, aesthetic
design, and emotional value, while the silver-haired demographic emphasizes user-friendly features
like simplified operations, voice prompts, and safety protections. This trend is driving the industry's
shift from "hit-driven" models to "scenario-based insights," requiring companies to define products
and extend services around the real-life scenarios of specific demographics.
In this complex landscape, technological innovation and channel transformation have become
the key drivers for industries to navigate economic cycles. On one hand, technologies like IoT, edge
computing, low-power communication, and large-scale AI models are being rapidly integrated into
product development, enabling small appliances to evolve from standalone smart devices to fully
interconnected home ecosystems. On the other hand, online channels continue to dominate
consumer behavior, with live-streaming e-commerce, social influencer marketing, and repurchase
systems becoming deeply intertwined. This convergence is compelling businesses to build
integrated operational capabilities encompassing products, content, and services.
Meanwhile, climate-related risks and sustainability requirements are fundamentally reshaping
industry competition dynamics. Physical and transition risks are increasingly becoming strategic
priorities for foreign trade enterprises. Companies with forward-looking climate risk management
capabilities, green manufacturing systems, and full lifecycle carbon footprint management can not
only reduce compliance costs but also gain a competitive edge in international procurement
processes for sustainable supply chain selection.
In the face of the aforementioned landscape, the company has consistently adhered to its
development strategy of "innovative design, specialized manufacturing, smart home appliances,
and international branding." During the reporting period, while consolidating its traditional
overseas market presence, it significantly increased resource allocation and channel development in
the domestic market of China. Through in-depth collaborative R&D with core domestic and
international clients, the company focused on high-potential scenarios such as kitchen health, smart
cleaning, and emotionalized personal care, continuously launching innovative products that
combine technological leadership, aesthetic design, and low-carbon attributes. The company also
advanced green manufacturing upgrades and climate resilience initiatives, strengthening carbon
footprint accounting, green certification acquisition, and low-carbon supply chain collaboration,
laying a solid foundation for long-term sustainable growth and the elevation of its global brand.
III. Core Competitiveness Analysis
During the reporting period, the company maintained stable core competitiveness without
significant adverse changes. Facing challenges such as the complex and volatile global trade
environment in 2025, overall pressure on export markets, and structural differentiation in domestic
consumption, the company leveraged its deep technical expertise, agile innovation mechanisms,
and robust manufacturing systems to continuously consolidate and strengthen its differentiated
competitive advantages.
Since its establishment, the company has consistently upheld a corporate culture of "R&D-
driven development," with over four decades of expertise in small appliance design and
manufacturing. It has built a comprehensive professional R&D and technical service system
covering product definition, industrial design, structural engineering, intelligent control, and green
material applications. During the reporting period, the company focused on three key R&D
directions: "enhancing product functionality, upgrading smart appliances, and integrating IoT
scenarios." It continued to advance the application of cutting-edge technologies such as AIoT, low-
power communication, and edge computing in kitchen, cleaning, and personal care appliances,
striving to create a product matrix characterized by "robust functionality, intelligent operation,
energy efficiency, and high added value." Throughout the year, the company secured 48 patent
authorizations, including 14 invention patents, 23 utility model patents, and 11 design patents.
These achievements effectively strengthened the company's intellectual property layout in core
technologies, user experience, and aesthetic design, further solidifying its technological moat of
independent control.
The company has established long-term strategic partnerships with globally renowned home
appliance brands and retail clients. Through a collaborative model of "preliminary R&D + joint
definition + rapid iteration," it accurately captures functional preferences, energy efficiency
standards, and cultural aesthetic demands across different regional markets. Particularly in the
context of stricter green compliance in European and American markets and accelerated smart
technology adoption in emerging markets, the company leverages its deep understanding of
international certification systems and rapid response capabilities to continuously deliver solutions
that combine compliance, innovation, and cost-effectiveness. This enables a strategic shift from
"contract manufacturing" to "value co-creation."
The company steadfastly implements its dual-circulation development strategy of "global
markets + domestic sales". While consolidating its overseas foundation, it actively capitalizes on
the policy dividends of China's "trade-in" program and the consumption upgrade trend. Focusing on
the authentic lifestyles of Gen Z, the new middle class, and senior citizens, the company drives
product evolution from "functional satisfaction" to "emotional value + scenario experience". By
reinforcing the tripartite product philosophy of "aesthetics, quality, and value", it has successfully
developed multiple premium products combining elegant design, smart interaction, and health
attributes. This approach effectively counters homogenized competition and unlocks new growth
opportunities.
During the reporting period, the company advanced the intelligent and green transformation of
Cankun Industrial Park by deploying flexible production lines, smart low-carbon equipment, and a
carbon management platform. These initiatives significantly boosted manufacturing efficiency,
product consistency, and compliance with low-carbon standards. Simultaneously, the company
deepened strategic partnerships with key suppliers to build a localized supply chain ecosystem
covering critical components, mold development, and logistics delivery. This enhanced the supply
chain's resilience and responsiveness in facing uncertainties like extreme weather and geopolitical
conflicts, ensuring reliable delivery of overseas orders and rapid product launches for domestic
sales.
In summary, the company has been building a hard-to-replicate core competitiveness through
four pillars: long-term technological accumulation, global collaborative innovation, dual-circulation
market strategy, and intelligent manufacturing resilience. Going forward, it will continue to drive
innovation and green transformation, further solidifying its leadership in smart small appliances to
deliver sustainable long-term value for shareholders.
IV. Analysis of Core Business
During the reporting period, the company's operating revenue stood at 1.345 billion yuan,
down 20.95% year-on-year. Total profit amounted to 31 million yuan, a 72.24% decrease from the
same period last year. Net profit attributable to shareholders of the listed company reached 23.5453
million yuan, down 67.65% year-on-year. Basic earnings per share (EPS) was 0.13 yuan, down
The changes in the aforementioned indicators are primarily attributed to multiple adverse
factors in 2025, including the impact of international trade policies, intensified industry competition,
and rising raw material prices. As a result, the net profit attributable to shareholders of the listed
company during the reporting period declined significantly compared to the same period last year.
Amid complex global dynamics and intense industry competition, the company has completed
capital increases in its Indonesian subsidiary, accelerated production expansion, and strengthened
order-taking capacity. With a strategic vision of "innovation-driven design leadership, precision
manufacturing excellence, smart home solutions, and global brand partnerships," it has established
a comprehensive R&D-to-manufacturing value chain competitiveness framework. The company is
deepening customized collaborations in mature markets like Europe and the U.S., accelerating
market penetration in emerging regions including Russia, Southeast Asia, and the Middle East,
while advancing internal production system upgrades to enhance efficiency and drive sustainable
growth.
(1) Composition of Operating Revenue
Unit: Yuan
Year-on-year
Project As a percentage As a percentage increase/decrease
Amount of Amount of
of operating of operating (%)
money money
revenue revenue
By industry
Small household
appliance 1,297,894,653.32 96.51 1,648,161,362.22 96.89 -21.25
manufacturing
Other business 46,880,902.92 3.49 52,954,088.34 3.11 -11.47
Amount to 1,344,775,556.24 100.00 1,701,115,450.56 100.00 -20.95
By product
Cooking 834,493,669.53 62.05 1,046,951,475.35 61.55 -20.29
Home Helper 369,884,920.65 27.51 450,085,933.70 26.46 -17.82
Year-on-year
Project As a percentage As a percentage increase/decrease
Amount of Amount of
of operating of operating (%)
money money
revenue revenue
Tea & Coffee
Makers
Other products 7,462,762.58 0.55 14,667,794.07 0.86 -49.12
Other business 46,880,902.92 3.49 52,954,088.34 3.11 -11.47
Amount to 1,344,775,556.24 100.00 1,701,115,450.56 100.00 -20.95
By region
America 595,844,245.75 44.31 847,408,182.11 49.81 -29.69
Europe 391,841,744.63 29.14 483,962,735.10 28.45 -19.03
Asia 338,492,312.48 25.17 333,233,943.33 19.59 1.58
Africa 2,953,785.89 0.22 15,758,618.31 0.93 -81.26
Australia 15,643,467.49 1.16 20,751,971.71 1.22 -24.62
Amount to 1,344,775,556.24 100.00 1,701,115,450.56 100.00 -20.95
(2) Industries, products, regions, and sales models contributing over 10% to the company's
revenue or operating profit
Applicable Inapplicable
Unit: Yuan
Year-on-
year Gross margin
Gross change Operating cost increase/decrease
Project Operating receipt Cost in business profit in increase/decrease compared to the
rate % operating (%) year-on-year same period last
revenue year (%)
(%)
By industry
Small
household
appliance
manufacturing
Other
business
Amount to 1,344,775,556.24 1,164,647,541.66 13.39 -20.95 -19.25 -1.82
By product
Cooking 834,493,669.53 742,912,713.79 10.97 -20.29 -17.90 -2.60
Home Helper 369,884,920.65 330,792,146.03 10.57 -17.82 -16.71 -1.18
Tea and
Coffee 86,053,300.56 75,142,750.98 12.68 -36.94 -36.67 -0.37
makers
Other
products
Other
business
Amount to 1,344,775,556.24 1,164,647,541.66 13.39 -20.95 -19.25 -1.82
By region
Year-on-
year Gross margin
Gross change Operating cost increase/decrease
Project Operating receipt Cost in business profit in increase/decrease compared to the
rate % operating (%) year-on-year same period last
revenue year (%)
(%)
America 595,844,245.75 541,878,569.80 9.06 -29.69 -27.20 -3.10
Europe 391,841,744.63 341,404,334.99 12.87 -19.03 -17.66 -1.46
Asia 338,492,312.48 265,973,692.34 21.42 1.58 4.86 -2.46
Africa 2,953,785.89 2,792,390.70 5.46 -81.26 -78.50 -12.13
Australia 15,643,467.49 12,598,553.83 19.46 -24.62 -24.63 0.01
amount to 1,344,775,556.24 1,164,647,541.66 13.39 -20.95 -19.25 -1.82
When the company's core business data reporting standards were adjusted during the reporting
period, the latest annual core business figures reflect the revised standards applied at the end of the
reporting period.
Applicable Inapplicable
(3) Does the company's sales revenue from physical goods exceed its service revenue?
Yes No
Year-on-year
Industry Classification project unit 2025 2024
increase/decrease (%)
quantity of sale tower 11,408,122 15,441,544 -26.12
Small household appliance
output tower 11,456,404 15,235,690 -24.81
manufacturing
stock balance tower 663,282 615,000 7.85
Analysis of the reasons for a year-on-year change exceeding 30% in relevant data
Applicable Inapplicable
(4) Performance of major sales and procurement contracts signed by the company during the
reporting period
Applicable Inapplicable
(5) Composition of operating costs
Industry and product categories
Unit: Yuan
percentage year
Industry percentage
project of amount of increase or
Classification amount of money of operating
operating money decrease
cost (%) (%)
cost (%)
Small
cost in
household 1,152,791,463.09 98.98 1,428,347,528.54 99.03 -19.29
business
appliance
percentage year
Industry percentage
project of amount of increase or
Classification amount of money of operating
operating money decrease
cost (%) (%)
cost (%)
manufacturin
g
Other
other 11,856,078.57 1.02 13,956,531.45 0.97 -15.05
business
amount to 1,164,647,541.66 100.00 1,442,304,059.99 100.00 -19.25
Unit: Yuan
percentage year
product percentage
project of increase or
classification amount of money amount of money of operating
operating decrease
cost (%) (%)
cost (%)
cost in
Cooking 742,912,713.79 63.79 904,917,723.90 62.74 -17.90
business
Home cost in
Helper business
Mingcha cost in
Coffee business
Other cost in
products business
Other
other 11,856,078.57 1.02 13,956,531.45 0.97 -15.05
business
amount to 1,164,647,541.66 100.00 1,442,304,059.99 100.00 -19.25
(6) Whether there were any changes in the scope of consolidation during the reporting period
Yes No
(7) Significant changes or adjustments to the company's business, products, or services
during the reporting period
Applicable Inapplicable
(8) Key Sales Clients and Major Suppliers
Company's primary sales client profile
Total sales of the top five customers (RMB) 905,992,673.80
Total sales of the top five customers as a percentage of annual sales (%) 69.80
The proportion of related-party sales in the top five customers' annual total
sales
Top 5 Customer Profiles
order number customer name Sales (RMB) Percentage of annual sales (%)
order number customer name Sales (RMB) Percentage of annual sales (%)
amount to 905,992,673.80 69.80
Other details about key customers
Applicable Inapplicable
Company's key suppliers
Total procurement amount of top five suppliers (RMB) 168,459,006.88
Total procurement amount of top five suppliers as a percentage of annual
procurement total (%)
Percentage of related-party purchases in the top five suppliers' annual procurement
volume (%)
Top 5 Supplier Information
Percentage of annual
order number Supplier name Purchase amount (RMB)
procurement total (%)
amount to 168,459,006.88 19.47
Additional information about major suppliers
Applicable Inapplicable
During the reporting period, the company's trade business revenue accounted for over 10% of its
total operating income.
Applicable Inapplicable
Unit: Yuan
Year-on-year
project 2025 2024 increase/decrease statement of material change
(%)
selling
expenses
general
expenses
This is mainly due to the decrease
cost of
financing
in the current period.
research and
development 61,494,511.72 64,932,266.81 -5.29
expenditure
Applicable Inapplicable
Expected impact
Main R&D project Target to be
Project Purpose on the company's
project name progress achieved
future development
Develop products for smart homes and
Expand market Expand market
low-carbon eco-friendly solutions,
have in share and boost share and boost
Innovative R&D while expanding into fully automatic
hand revenue and revenue and
coffee machines, laundry care devices,
profitability profitability
and tea-making machines.
Company R&D personnel
Number of R&D personnel (people) 374 386 -3.11
Proportion of R&D personnel (%) 10.74 10.65 0.09
Educational Background of R&D Personnel
Master's degree or above 7 3 133.33
undergraduate course 109 100 9.00
Associate degree or lower 258 283 -8.83
Age distribution of R&D personnel
Under 30 years old 119 133 -10.53
Over 40 years old 142 136 4.41
Company R&D investment
Change percentage
(%)
R&D investment (RMB) 61,494,511.72 64,932,266.81 -5.29
R&D investment as a percentage of
operating revenue (%)
Amount of R&D investment capitalized
(RMB)
capitalization ratio of R&D investment 0.00 0.00 0.00
Reasons and Influence of Major Changes in the Composition of R & D Personnel in the Company
Applicable Inapplicable
The reason for the significant change in the proportion of total R&D investment to operating
revenue compared to the previous year
Applicable Inapplicable
Reasons and Rationality of the Significant Change of the Capitalization Rate of R&D Investment
Applicable Inapplicable
Unit: Yuan
Year-on-year
project 2025 2024 increase/decrease
(%)
cash flow from operating activities 1,625,862,225.91 1,921,209,060.80 -15.37
cash outflow from operating activities 1,640,849,347.81 1,784,825,648.71 -8.07
net cash flow from operating activities -14,987,121.90 136,383,412.09 -110.99
subtotal of cash inflow from investing
activities
cash outflow from investing activities 623,455,594.35 1,224,753,424.36 -49.10
net cash flow from investing activities 95,368,640.58 -178,127,070.73 153.54
cash inflow from financing activities 40,589,970.39 32,643,510.42 24.34
cash outflow from financing activities 102,835,743.41 111,030,342.32 -7.38
net cash flow from financing activities -62,245,773.02 -78,386,831.90 20.59
net increase in cash and cash equivalents 18,957,048.50 -119,919,544.03 115.81
Analysis of the primary factors behind significant year-on-year changes in relevant data
Applicable Inapplicable
Net cash flow from operating activities: This primarily results from lower main business revenue
and reduced cash receipts from sales of goods and services during the period.
Net cash flow from investing activities: Primarily attributable to reduced outflows from bank term
deposits during the period, which were held for interest income purposes.
Analysis of Significant Differences Between Net Cash Flow from Operating Activities and Annual
Net Profit During the Reporting Period
Applicable Inapplicable
V. Analysis of Non-Core Business
Applicable Inapplicable
Unit: Yuan
Percentage
amount of Is it
of total Explanation of formation cause
money sustainable?
profit (%)
miscellaneous mainly government subsidies related to production
incomes and operation;
The main sources are interest income from time
yield 29,022,384.02 94.58 deposits and returns from wealth management deny
products.
The primary reason is that the revenue of wealth
fair value
management products, amounting to 940,000
change gain or -942,083.33 -3.07 deny
yuan, was recorded as a reversal at the end of 2024
loss
and reflected in this reporting period.
credit The primary reason is that some customers'
-828,311.85 -2.70 deny
impairment payments are overdue and not recovered, requiring
Percentage
amount of Is it
of total Explanation of formation cause
money sustainable?
profit (%)
loss an impairment provision for accounts receivable
under accounting policies.
loss on The primary reason is the provision for inventory
impairment of -3,642,607.37 -11.87 write-downs and fixed asset impairment losses in deny
assets the current period.
The main income sources for this period include
compensation for intellectual property
nonbusiness
income
memberships, and compensation for canceled
orders.
non-business The primary expense was the penalty imposed on
expenditure its subsidiary, Indonesia's Canxing Netcom.
VI. Analysis of Assets and Liabilities
Unit: Yuan
By the end of 2025 Early 2025 Increase
or
Proportion Proportion decrease statement of material
project amount of amount of
of total of total in change
money money proportion
assets (%) assets (%)
(%)
monetary
resources
This is mainly due to
trading
the maturity of the
financial 0.00 0.00 50,942,083.33 1.93 -1.93
financial products in
assets
this period.
accounts
receivable
contractual
assets
stock 193,718,061.45 7.89 194,399,523.78 7.38 0.51
The increase was
non current mainly due to the
assets due transfer of debt
within one investments maturing
year within the current
year.
This is mainly due to
the decrease of time
other current
assets
within one year in the
current period.
This is mainly due to
the decrease in time
equity
investment
over one year in the
current period.
By the end of 2025 Early 2025 Increase
or
Proportion Proportion decrease statement of material
project amount of amount of
of total of total in change
money money proportion
assets (%) assets (%)
(%)
investment
property
The primary reason is
long term the investment
equity 7,884,938.82 0.32 0.00 0.00 0.32 payment to the
investment associated enterprise
in the current period.
fixed assets 162,861,863.08 6.63 146,795,190.83 5.57 1.06
The primary cause
was the unaccepted
new assembly plant at
Sun's subsidiary
construction Indonesia Canxing
in process Netcom's industrial
park, along with
unaccepted new
equipment including
die-casting machines.
assets of
right of use
This is mainly due to
deferred tax the impact of the
assets lease change in the
current period.
This is mainly due to
long term the reduction in long-
deferred 3,395,913.29 0.14 5,571,380.26 0.21 -0.07 term deferred
expense expenses during the
period.
This is mainly due to
the initial prepayment
other non for equipment and the
current assets completion of
acceptance during the
current period.
money
borrowed for 0.00 0.00 0.00 0.00 0.00
short time
This is mainly due to
the decrease in the
notes
payable
acceptance bills
during the period.
contract
liabilities
This is primarily
attributable to the
tax payable 7,067,320.13 0.29 18,310,394.76 0.69 -0.40 2024 annual corporate
income tax settlement
and finalization
By the end of 2025 Early 2025 Increase
or
Proportion Proportion decrease statement of material
project amount of amount of
of total of total in change
money money proportion
assets (%) assets (%)
(%)
conducted during the
current period.
This is due to the
accounts
decrease in other
payable- 28,579,322.67 1.16 40,877,557.33 1.55 -0.39
payables in the
others
current period.
This is mainly due to
non current
the reduction of one-
liabilities due
within one
recognized in the
year
current period.
money
borrowed for
long term
lease
obligation
a high proportion of overseas assets
Applicable Inapplicable
Proport
control ion of
Whether
measure overse
specific there is
forming operation s for risk return as
content asset size location significant
reason pattern security profile assets
of assets impairmen
of to net
t risk
assets assets
(%)
Small
household periodic
Indones non-
SCI invest 256,956,101.10 appliance inventor -9,721,855.11 23.58
ia existent
manufacturi y
ng
Other
circumst not have
ances
Applicable Inapplicable
Unit: Yuan
cumulative
fair value impairment Purchase
Current fair Sales amount Other End of period
Project Beginning balance change provision for amount for
value change of the issue changes amount
attributable to the period this period
equity
Financial assets
financial assets
(excluding
derivative
cumulative
fair value impairment Purchase
Current fair Sales amount Other End of period
Project Beginning balance change provision for amount for
value change of the issue changes amount
attributable to the period this period
equity
financial assets)
financial assets
investments
Instruments 40,000.00 40,000.00
Investments
current financial
assets
Subtotal of
financial assets
Investment
property
Productive
biological assets
Other
Total above 50,982,083.33 -942,083.33 50,000,000.00 40,000.00
Financial
liabilities
Did the company's core assets undergo significant changes in measurement attributes during the
reporting period?
Yes No
Applicable Inapplicable
VII. Analysis of Investment Status
Applicable Inapplicable
Unit: Yuan
investment in the same period of last
investment during reporting period amplitude of fluctuation （%）
year
Applicable Inapplicable
Applicable Inapplicable
(1) Securities Investment Status
Applicable Inapplicable
(2) Derivative Investments
Applicable Inapplicable
Applicable Inapplicable
Unit: 10,000 yuan
percentage
of closing
purchase sales
cumulative investment
current amount amount
fair value amount to
investment in initial opening fair during during ending
change net assets at
derivatives investment balance value the the amount
attributable the end of
change reporting reporting
to equity the
period period
reporting
period
forward exchange 2,131.19 0 0 0 2,131.19 2,131.19 0 0.00%
amount to 2,131.19 0 0 0 2,131.19 2,131.19 0 0.00%
Accounting policies
and specific
principles for hedge
operations during the
reporting period,
along with a The accounting policy and accounting principles of the company's derivatives in the reporting
statement of whether period are not significantly different from those in the previous reporting period.
there have been
significant changes
compared to the
previous reporting
period.
statement of actual
During the reporting period, the delivered portion of investment derivatives resulted in a loss
profit and loss during
of RMB 33,700, while the undelivered portion incurred no assessed loss.
the reporting period
The company uses hedging as a means to avoid and prevent the risk of exchange rate
statement of hedging
fluctuations, and carries out derivative trading business, which is conducive to avoiding the
effect
risk of exchange rate fluctuations and enhancing financial stability.
source of investment
funds in the hands of the localities
capital for derivatives
Risk Analysis and 1. Risk analysis of derivative positions: Exchange gains or losses arising from the difference
Control Measures for between the contract exchange rate and the market exchange rate on the settlement date.
Derivatives Holdings 2. Control Measures:
During the Reporting (1) Principles: All financial derivatives operations of the company shall be conducted for
Period (including but hedging purposes only, and no non-hedging trading activities shall be engaged in. The
not limited to market company shall not engage in complex derivative transactions beyond its actual operational
risk, liquidity risk, needs, nor shall it use hedging as a pretext for derivative speculation. The total hedging
credit risk, contract volume of the company shall not exceed the sum of its existing net exposure
operational risk, and positions and the net exposure positions arising from business activities within the next year.
legal risk) (2) Job Requirements: Participants in derivative investments must fully understand the
associated risks and strictly adhere to the operational procedures and risk management
protocols for such investments.
(3) Operational Guidelines: Prior to initiating derivative investments, the company shall
allocate qualified professionals for investment decision-making, operational execution, and
risk management. Comparative analysis and price inquiries should be conducted across
multiple markets and product types. The company must strictly regulate the types and scale of
derivative investments, prioritizing exchange-traded derivatives.
(4) Regular Evaluation: Derivatives investments shall undergo at least two monthly
evaluations, with reports submitted to senior executives authorized by the Board of Directors.
The annual total investment quota report for corporate financial derivatives must be filed with
the Board of Directors annually. Actual trading activities of derivative instruments shall be
reported to the most recent Board of Directors post-transaction. Each subsidiary may submit
reports exclusively to its respective Board of Directors.
(5) Stop-loss limit: The combined maximum loss for a single derivative and all investments
shall not exceed 20% of the total investment amount.
(6) Audit Mechanism: The company's audit department shall conduct monthly reviews of the
procedures for handling derivative commodity transactions, prepare reports, and submit them
to relevant departments.
For derivative
investments where
market price or fair
(1) During the reporting period, the delivered portion of the investment derivatives resulted in
value of products
a loss of RMB 33,700, while the undelivered portion incurred no assessed loss.
fluctuated during the
(2) The original contracting bank shall provide the bank's estimated exchange rate table for
reporting period, the
the current period of signed but unexpired forward foreign exchange settlement transactions
fair value analysis
on the last trading day of each month.
shall disclose the
(3) The fair value change gain or loss is recognized based on the difference between the
specific methodology
estimated exchange rate in the estimation table and the purchase currency, calculated on the
employed, along with
unexpired contract amount as of the closing date.
the assumptions and
parameters used in
the calculation.
Case details not have
date of disclosure of
board of directors'
announcement on 11 March 2025
approval of derivative
investment
date of disclosure of
shareholders' meeting
announcement for 17 May 2025
derivative investment
approval
Applicable Inapplicable
VIII. Sale of Major Assets and Equity
Applicable Inapplicable
Applicable Inapplicable
IX. Analysis of Major Holding and Participating Companies
Applicable Inapplicable
Key subsidiaries and equity companies with over 10% impact on net profit
Unit: Yuan
corp
company registered operating
orate primary service total assets net asset operating receipt net margin
type capital profit
name
Small household 160
TKL subsidiary appliance million 2,190,651,630.22 1,334,617,308.28 1,199,152,943.42 20,719,808.72 25,804,692.63
manufacturing dollars
Small household 40
Subsidiary
TKS appliance million 263,787,986.84 262,920,888.02 1,628,118.68 4,777,789.11 3,567,557.86
company
manufacturing dollars
Small household 53
Subsidiary
SCI appliance million 256,956,101.10 203,722,315.86 212,799,909.87 -9,607,103.28 -9,721,855.11
company
manufacturing dollars
Status of acquisitions and disposals of subsidiaries during the reporting period
Applicable Inapplicable
X. Corporate Controlled Structured Entities
Applicable Inapplicable
XI. Future Development Outlook of the Company
(1) Future Development Strategy
The company will integrate its three core systems—product marketing, sales, and R&D—to
establish a more professional R&D and technical service system. Leveraging over 40 years of
experience in small appliance design and manufacturing, it will continue to develop specialized
product platforms, conduct in-depth research on consumption habits and cultural differences across
global regions, and provide optimized solutions that meet or even lead market demands from a
product marketing perspective. Through close collaboration with clients, the company will jointly
create competitive advantages in product value and launch innovative products aligned with market
needs. In terms of client market management, the company will focus resources on strategic client
partnerships, prioritizing client needs and allocating effective resources to key client relationships
that support long-term development, fostering a mutually beneficial cooperation model.
Simultaneously, it will actively explore new markets and customer order opportunities while
nurturing potential emerging clients.
In the China market, the company will enhance the application of technologies such as smart
operations, scenario-based IoT, and 5G to meet consumers' demand for high-quality and convenient
living, launching a series of convenient, intelligent, and personalized health home appliances. An
independent R&D system will be established to serve the domestic market, with a focus on
investing in brand strategy and the development of smart home appliances. Online and offline
marketing channels will advance in tandem, with OBM (Own Brand Manufacturing) and ODM
(Original Design Manufacturing) operating in parallel. The company will focus on the needs of
new consumer groups, explore opportunities for new products, new channels, and new customers,
strengthen external cooperation, achieve separation of production and sales, and build brand
development strategies around consumer needs. The positioning of the Cankun EUPA brand is a
professional, high-value, and premium-quality brand image.
By adopting the BU (Business Unit) specialized manufacturing model, the company focuses
on intelligent manufacturing upgrades for core components, deepens research into product
technologies and production processes, and wins customer recognition and satisfaction through
professional manufacturing. The company plans to enhance production efficiency and yield rates
through digital system upgrades and the application of new technologies, materials, processes, and
equipment, thereby comprehensively improving the supply chain manufacturing and supporting
capabilities of the industrial park. Additionally, it will advance the upgrade and construction of the
Cankun Industrial Park, cultivating a highly efficient, IT-supported supply chain strategic
ecosystem to lay a solid foundation for the company's future development.
as its core business, the CanKun Group expands its commercial development both
domestically and internationally.
In the face of the fragmentation and restructuring of the global supply chain system, the
company remains committed to its core business of innovative design and specialized
manufacturing of small household appliances, vigorously developing commercial frameworks in
Xiamen and Shanghai to provide a robust support platform for the China market. Leveraging the
regional advantages of Xiamen and Shanghai in developing local industries, the company has
formed the CanKun business development model. It implements a decentralized market strategy,
further expanding the overseas manufacturing base of CanKun in Indonesia, accelerating the
integration of its supply chain with its home market, actively addressing international trade barriers,
and fully utilizing the strategic regional cooperation advantages of the "Belt and Road" initiative to
seize opportunities in overseas markets. This approach aims to establish a comprehensive model
where domestic and international manufacturing and business development are mutually
reinforcing.
(2) Major Risk Factors for Future Development
The complex international environment, the impact of geopolitical conflicts, and the rise of
trade protectionism have made issues such as tariffs, technical standards, and intellectual property
protection more complicated. Problems like the slow global economic recovery, increased
exchange rate fluctuations, and rising costs are difficult to resolve in the short term, leading to a
decline in international market demand. In response, the company will continue to advance the
development of its manufacturing base in Indonesia, leveraging the advantages of the "Belt and
Road" policy to actively address these challenges.
The manufacturing sector faces challenges including rising labor costs and an aging workforce.
To address these issues, the company is committed to advancing specialized automated
manufacturing systems, upgrading supply chain infrastructure, and optimizing production
environments. Simultaneously, it strengthens talent acquisition, development, and retention
strategies, enhances corporate culture, builds a robust talent framework, and elevates its core
competitiveness.
Given that the company's products are primarily export-oriented, exchange rate fluctuations
significantly impact its operations. To mitigate risks, the company employs financial instruments,
thoroughly evaluates exchange rate risks during order acceptance, and adopts multi-currency
transactions for material procurement to reduce the effects of exchange rate volatility.
In line with global green development trends, the company will continue to adopt eco-friendly
materials and technologies, increase automation investments, enhance environmental process
technologies, and steer product development toward green and energy-efficient solutions to
strengthen its sustainable development capabilities.
As global supply chains evolve, the emergence of new market segments presents both
opportunities and challenges. The company will actively participate in home appliance exhibitions
and trade shows worldwide, invite strategic clients for factory visits, and establish in-depth
business partnerships to jointly expand global product sales markets.
(3) Industry Development Trends and Market Prospects
In the era of wireless connectivity, information explosion, and smart technology, smart home
devices have emerged as a key driver for the small appliance industry, propelling product evolution
toward intelligent and multifunctional solutions. Globally, while Western markets remain dominant,
emerging markets like Southeast Asia and the Middle East are demonstrating significant potential.
Domestically, consumption upgrades are fueling rapid growth in the small appliance sector, with
intensified brand competition and a clear trend toward specialization and branding. Powered by
technological innovation, these products are advancing in intelligence, user-centric design, and eco-
friendliness. Distribution channels are transitioning from physical to digital platforms, with social
commerce emerging as a new growth engine. The omnichannel retail model is set to become
mainstream, delivering seamless shopping experiences for consumers.
In summary, the small appliance industry is undergoing rapid transformation. Trends such as
smart technology, health-focused designs, eco-friendly solutions, product diversification, and
omnichannel retail will drive the sector's sustainable growth. The company will stay ahead of
industry trends by continuously innovating, enhancing product quality and design standards to meet
evolving consumer demands. Simultaneously, it will actively expand both domestic and
international markets to strengthen brand influence and market competitiveness.
XII. Hosting research visits, communication sessions, and interviews during the
reporting period
Recept
ion Reception Recipie Reception Main content of the discussion Basic Index
Reception hours
locatio style nt type targets and materials provided of Research
n
Inquiry regarding the impact
of the Listing Company
Supervision Guidelines No.10
compa Phone individ – Market Value Management
ny call ual on the company, and the
maintenance of the company's
dividend policy. No materials
provided.
Whether to implement a
valuation enhancement plan
compa Phone individ
ny call ual
operational status. No
information provided.
Do not create a valuation
compa Phone individ
March 03,2025 Mr.Zhang enhancement plan. No data not have
ny call ual
provided
Whether to implement a
valuation enhancement plan.
compa Phone individ
ny call ual
share transfer board situation.
No materials provided.
In response to the U.S. trade
war, companies should
Mr.Yang, http://www.
compa Field individ enhance their market value
ny research ual enhancement plans and
Mr.Wang cn
implement measures such as
increasing dividend payouts.
Inquire about the impact of
compa Phone individ
ny call ual
provided
Inquire about the impact of
compa Phone individ
ny call ual
provided
Proposals regarding tariff
issues, relocating production
compa Phone individ
ny call ual
dividend ratios. No materials
provided.
Proposal to increase the
compa Phone individ
ny call ual
provided
Tariff impact and overseas
compa Phone individ
ny call ual
provided
Market capitalization status.
compa Phone individ
ny call ual
operations. No data provided.
compa Phone individ Proposal to increase the
ny call ual dividend ratio. No materials
provided
compa Phone individ The impact of tariffs on the
ny call ual company. No data provided.
The impact of unilateral high
tariffs by the US on the
http://www.
compa Field individ Mr.Yang, company's operations and
ny research ual Mr.Wang countermeasures, as well as
cn
the progress in domestic
market development
Proposal to increase the
compa Phone individ
ny call ual
provided
Consultation for conversion
compa Phone individ
ny call ual
provided.
The determination of dividend
compa Phone individ
ny call ual
provided
Inquire about the company's
compa Phone individ
ny call ual
materials provided
Inquire about the company's
compa Phone individ business operations and the B-
ny call ual to-A conversion. No materials
provided.
B to A consultation: Is the
compa Phone individ company considering a merger
ny call ual or acquisition? No information
provided.
Inquire about the company's
compa Phone individ
ny call ual
materials provided
Company operations, domestic
Mr.Li sales, and B-to-A conversion. not have
No data provided.
compa Phone individ Company operations, B-to-A
ny call ual conversion. No data provided
The company's operating
compa Phone individ status indicates a desire to
ny call ual increase dividends. No
materials were provided.
The company aims to increase
Mr.Chen not have
materials were provided.
The shareholder inquires about
the biannual dividend
distribution and the conversion
Mr.Zhou from B to A shares, asking not have
whether the company can
provide products as a gift. No
materials were provided.
Applicable Inapplicable
XIII. Implementation Status of Market Value Management System and
Valuation Enhancement Plan
Has the company established a market value management system?
Yes No
Has the company disclosed a valuation enhancement plan?
Yes No
The Valuation Enhancement Plan includes the following key components:
To enhance the company's investment value, boost shareholder returns, and drive high-quality
growth, the company has implemented the following concrete measures:
(1) Focus on the main business, improve the quality of operation and company performance
(2) Implement a stable cash dividend policy to effectively reward investors
(3) Strengthening Investor Relations Management and Information Disclosure Quality
The Board of Directors confirms that the Valuation Enhancement Plan disclosed by the
company on March 11,2025, is consistent with its actual conditions and requires no adjustments.
This plan will continue to be implemented in subsequent years.
XIV. Implementation Status of the "Dual Enhancement of Quality and Return"
Action Plan
Has the company released the announcement for its 'Dual Enhancement of Quality and Return'
initiative?
Yes No
Section IV.Corporate Governance, Environment and Society
I.Basic situation of corporate governance
During the reporting period, the company strictly adhered to the requirements of the Company
Law, Securities Law, Corporate Governance Guidelines for Listed Companies, Shenzhen Stock
Exchange Listing Rules, Shenzhen Stock Exchange Self-Regulatory Guidance No.1 for Main
Board Listed Companies, and other relevant laws and regulations. It continuously improved its
corporate governance structure, strengthened internal control systems, enhanced information
disclosure, standardized operations, and elevated governance standards. As of the reporting period's
end, the company's governance practices fully complied with the regulatory requirements set forth
in the normative documents issued by the China Securities Regulatory Commission (CSRC) and
the Shenzhen Stock Exchange for listed companies.
The governance of the company is as follows:
The company convenes shareholders 'meetings in accordance with its Articles of Association
and the Rules of Procedure for Shareholders' Meetings, ensuring equal treatment for all
shareholders, safeguarding the equal status of minority shareholders, and guaranteeing that all
shareholders can fully exercise their rights.
The controlling shareholder strictly complies with the Company Law in exercising shareholder
rights and fulfilling obligations. The controlling shareholder and the listed company have achieved
operational, asset, institutional, and financial independence. The company's board of directors and
internal departments operate independently, each bearing their own financial and operational
responsibilities. There is no direct or indirect interference in corporate decision-making or business
operations beyond the shareholders' meeting, and no harm has been done to the interests of the
company or its shareholders.
The company strictly follows the director selection procedures stipulated in its Articles of
Association to elect directors, with the board's composition and size complying with legal,
regulatory, and corporate requirements. The board diligently implements the Board of Directors'
Rules of Procedure to ensure efficient operations and sound decision-making. All directors
faithfully, honestly, and diligently perform their duties, attending board and shareholder meetings
with a responsible attitude and actively participating in relevant training programs.
The company strictly complies with the "Measures for the Administration of Information
Disclosure by Listed Companies", the "Stock Listing Rules of the Shenzhen Stock Exchange", and
the "Self-Regulatory Guidance No.5 for Listed Companies — Information Disclosure Affairs
Management" issued by the Shenzhen Stock Exchange, among other relevant regulations and
normative documents. It fulfills its information disclosure obligations to ensure all shareholders
have equal access to relevant company information.
The company is progressively refining and establishing fair and transparent performance
evaluation standards and incentive-restraint mechanisms for directors and senior executives. The
appointment of senior executives is conducted openly and transparently, in full compliance with
legal and regulatory requirements.
The company actively fulfills its corporate social responsibilities by fully respecting and
safeguarding the legitimate rights and interests of stakeholders. Through enhanced communication
and collaboration with all parties, it achieves balanced interests among shareholders, employees,
and society, collectively driving the company's sustainable and healthy development.
Is there a significant difference between the actual situation of corporate governance and the
regulations issued by the law, administrative regulations and the China Securities Regulatory
Commission on the governance of listed companies?
Yes No
II.The company's independence from its controlling shareholder and actual
controller in terms of assets, personnel, finances, organizational structure, and
operations
The company is independent and complete in business, personnel, assets, organization and
finance compared with the controlling shareholders.
III. Competition in the Same Industry
Applicable Inapplicable
IV. Directors and Senior Management
Number number
Number
of other of
surname of shares cause of
Initial shares increase shares
and Employment to be change in
sex age post Term start date End of term share to be or held at
personal status increased share
count reduced decrease the end
name in this capital
in this (stock) of the
period
period period
Chairman at present
Cai
man 69 and General hold the 19 May 2021 18 May 2026 0 0 0 0 0
Yuansong
Manager office of
at present
Lin Ji
man 57 director hold the 24 April 2020 18 May 2026 0 0 0 0 0
Dian
office of
at present
Ivan
man 57 director hold the 24 April 2020 18 May 2026 0 0 0 0 0
Wang
office of
at present
Cai
man 41 director hold the 13 May 2022 18 May 2026 0 0 0 0 0
Bingbo
office of
at present
Liu independent
man 56 hold the 24 April 2020 18 May 2026 0 0 0 0 0
Luhua director
office of
at present
Wu independent
man 44 hold the 24 April 2020 18 May 2026 0 0 0 0 0
Yibing director
office of
at present
Tang independent
man 60 hold the 19 May 2023 18 May 2026 0 0 0 0 0
Jinmu director
office of
at present
Wu finance
man 46 hold the 29 March 2019 0 0 0 0 0
Jianhua chief
office of
at present
Sun Secretary of
woman 52 hold the 23 April 2011 0 0 0 0 0
Meimei the Board
office of
amount to -- -- -- -- -- -- 0 0 0 0 0 --
Were there any directors or senior executives leaving their positions during the reporting period?
Yes No
Changes in Directors and Senior Management of the Company
Applicable Inapplicable
Professional background, key career experiences, and current responsibilities of the company's
current directors and senior executives
surname post Professional Key professional experience and current responsibilities at the company
and Background
personal
name
Cai Chairman Graduated from 1978.11.2-1987.12 Tsann Kuen (Taiwan) Enterprise Manager of the
Yuansong and General the University of Co., Ltd. Home Appliances
Manager Minnesota, St. Department/Research
Paul, majoring in and Development
Business Department, General
Administration. Manager
Appliance Co., Ltd.
Co., Ltd.
Ltd.
Co., Ltd.
Enterprise Co., Ltd.
(Taiwan)
Co., Ltd.
Enterprise Co., Ltd.
Limited (HK)
Limited (HK)
CO., LTD. (Taiwan)
(Taiwan)
Enterprise Co., Ltd.
Ltd
LIMITED (HK)
PROPERTIES LIMITED (HK)
(HK)
(HK)
surname post Professional Key professional experience and current responsibilities at the company
and Background
personal
name
Co., Ltd.
Enterprise Co., Ltd. General Manager
Port Electronics Enterprise Co., General Manager
Ltd.
Ltd.
INDONESIA
Lin Ji director Graduated from 1996.06-1999.08 Changjia Construction Co., Ltd. Special Assistant to
Dian the Graduate the General Manager,
School of Audit Specialist
Business 1999.08-2000.10 ADDA CORPORATION Auditing Office
Administration Manager, Assistant
at Datong to the Chairman
University 2000.10-2002.10 Royal DSM Auditing Office
Manager, Special
Assistant to the
General Manager
Special Assistant,
Head of the
Administration
Department, and
Spokesperson
Chief Administration Officer of YFY Packaging Inc. in
East China, Director of SinoPac Financial Holdings
Company Limited, SinoPac Paper Corporation, Union
Paper Corporation, China Color Printing Co., Ltd.,
Mitsukoshi Enterprise Co., Ltd., Yeon Technologies Co.,
Ltd., Huaci Bills Co., Ltd., FOONGTONE
TECHNOLOGY CO., LTD., Belton Co., Ltd. (Taiwan,
Japan), YFY Capital Co., Ltd., YFY Paper Co., Ltd.
(Shanghai, Nanjing, Suzhou, Jiaxing, Kunshan), YFY
Paper Mfg. Co., Ltd. (Yangzhou),
YUENFOONGYUFAMILYCARE(KUNSHAN)COLT
D, Mitsukoshi Environmental Protection Engineering
Co., Ltd. (Kunshan), Ningbo Beautone Co., Ltd., Beijing
Yingge Digital Co., Ltd., Senior manager of
BOARDTEK ELECTRONICS CORPORATION,
supervisor of Applied Wireless IDentifications
Group,Inc.(US) , HOPAX
Auditing Department of TaiPei
TUNG YANG Co., LTD. Manager of E-
(Taiwan) commerce, Business
surname post Professional Key professional experience and current responsibilities at the company
and Background
personal
name
Planning Department
Service Co., Ltd (Taiwan)
Corporation (Taiwan)
(Taiwan)
(Taiwan)
CO., LTD. (Taiwan)
Ltd.
Enterprise Co., Ltd.
Enterprise Co., Ltd.
(Hong Kong)
(Hong Kong)
LIMITED(BVI)
DEVELOPMENT INDONESIA
Ltd. (Taiwan)
Kong)
Ltd
Co., Ltd.
Ivan director Graduated from 2001.12-2007.06 Tsann Kuen Enterprise Co., Ltd. Finance Department
Wang Griffith (Taiwan) Specialist, Section
University, Chief
surname post Professional Key professional experience and current responsibilities at the company
and Background
personal
name
Australia, with a 2007.06-2020.10 Tsann Kuen Enterprise Co., Ltd. Deputy Director of
degree in (Taiwan) the Finance
Finance and Department and
Financial Acting Spokesperson
Management. 2010.10-2016.10 Tsann Kuen Enterprise Co., Ltd. financial manager
(Taiwan)
(Taiwan) Finance Department
(Taiwan)
(Taiwan) Associate
Ltd. (Taiwan)
Corporation (Taiwan)
Ltd
Co., Ltd.
Cai director Master of 2013.04.22- Thermaster Electronic (Xiamen) Project team
Bingbo International 2013.12.31 Ltd. members
Business and 2014.01.02- Tsann Kuen (Zhangzhou) Deputy Director of
Management 2016.12.31 Enterprise Co., Ltd. the European
from the Region, Ministry of
University of Commerce
Bradford, UK 2017.01.01- Tsannkuen Edge Intelligence Co., European Region
Commerce
Services Co., Ltd. General Manager
Enterprise Co., Ltd.
Ltd.
Ltd.
Co., Ltd.
Wu independen Ph.D. in 2010.08.26- Accounting Department of School assistant professor
Yibing t director Accounting, 2014.08.01 of Management, Xiamen
Fudan University University
of Management, Xiamen
surname post Professional Key professional experience and current responsibilities at the company
and Background
personal
name
University
Ltd.
(Xiamen) Co., Ltd.
Co., Ltd.
Liu independen Master of Laws 1991.09-1992.12 Xiamen Intermediate People’s engrossment clerk
Luhua t director in Civil and
Court
Commercial
Law, Xiamen 1992.12-1993.06 Orient (Xiamen) Golf Co., Ltd. Corporate
University CounselCompliance
Officer
Ltd.
College (Part-time)
CO., LTD
Ltd.
Co., Ltd.
Airport Co., Ltd.
Tang independen Doctor of 1988.7-1994.06 Xiamen Municipal Finance Bureau Clerk
Jinmu t director Finance from 1994.6-1998.6 Xiamen Accounting Firm Deputy Director
Xiamen 1996.7-1998.12 Xiamen Asset Appraisal Institute Head of Office
University, Xiamen Tianjian Huatian
Senior 1999.1-2001.12 Director, Partner
Accounting Firm
Accountant
Xiamen Asset Appraisal
Association
Xiamen Association of Certified
Public Accountants
Xiamen Redphase Power
Equipment Co.
Tsann Kuen (China) Enterprise
Co., Ltd.
Fujian Jinlin Forest Industry Co. Independent
Director
Sun secretary Graduated Co., Ltd. Representative
surname post Professional Key professional experience and current responsibilities at the company
and Background
personal
name
Meimei of the from China 2011.04.23-now Tsann Kuen (China) Enterprise Board Secretary
board Information Co., Ltd.
Management
College with a
major in Tsann Kuen (China) Enterprise Secretary Office
Business 2021.7.1-now
Co., Ltd. Assistant
Administratio
n
Enterprise Co., Ltd. Department clerk
Accounting
Department
Enterprise Co., Ltd. Account Section of
Accounting
Department
Enterprise Co., Ltd. Section of
Accounting
Department
Graduated Payable in
from the Accounting
Wu finance Department of Department
Jianhua chief Accounting at 2014.05.01- Tsann Kuen (China) Enterprise Vice manager of
Fuzhou 2019.03.21 Co., Ltd. Cost /Accounts
University Payable in
Accounting
Department
Co., Ltd. Department
manager
Co., Ltd.
Service Co.,Ltd.
Enterprise Co., Ltd.
The situation where the controlling shareholder and the actual controller simultaneously serve as
the chairman and general manager of the listed company
Applicable Inapplicable
Employment status in shareholder unit
Applicable Inapplicable
whether the
position held
shareholder
Personnel in a End of
Shareholder unit name Term start date unit receives
Name shareholder term
remuneration
unit
allowance
Cai Tsann Kuen (Taiwan) Investment
director 23 June 2018 No
Yuansong Co., Ltd
Cai EUPA Industry Corporation
director 14 August 2018 No
Yuansong Limited (HK)
Cai Fillman Investments Limited
director 14 August 2018 No
Yuansong (HK)
Cai Fordchee Development Limited
director 14 August 2018 No
Yuansong (HK)
Cai STAR COMGISTIC CAPITAL
director 25 February 2020 Yes
Yuansong CO., LTD. (Taiwan)
STAR COMGISTIC CAPITAL
Lin Ji Dian chairman 31 March 2020 Yes
CO., LTD. (Taiwan)
Sino Global Development Ltd.
Lin Ji Dian director 21 April 2020 No
(HK)
Employment history in other organizations
Applicable Inapplicable
Whether
remuneratio
Positions held n
Personnel Term start End of
Other organization names in other allowances
Name date term
organizations are received
from other
units
September
Cai Yuansong Thermaster Electronic (Xiamen) Ltd. director No
Sekond Creative Design Co., Ltd. 1 June
Cai Yuansong chairman No
(Taiwan) 2011
Chairman and
Tsann Kuen (Zhangzhou) Enterprise
Cai Yuansong General 5 July 2021 Yes
Co., Ltd.
Manager
STAR COMGISTIC CAPITAL CO., 22 August
Cai Yuansong director Yes
LTD. (Taiwan) 2018
Tsann Kuen China (Shanghai) 1 April
Cai Yuansong director No
Enterprise Co., Ltd. 2020
East Sino Development Limited 29 April
Cai Yuansong director No
(HK) 2020
Cai Yuansong Orient Star Investments Limited director No
PT.STAR COMGISTIC 4 August
Cai Yuansong chairman No
INDONESIA 2021
Wing Yi International Investment
Lin Ji Dian chairman December deny
Corporation (Taiwan)
Lin Ji Dian Tsann Kuen Japan Co., Ltd. chairman deny
Tsann Kuen China (Shanghai) 1 April
Lin Ji Dian director deny
Enterprise Co., Ltd. 2020
Whether
remuneratio
Positions held n
Personnel Term start End of
Other organization names in other allowances
Name date term
organizations are received
from other
units
Tsann Kuen (Zhangzhou) Enterprise 1 April
Lin Ji Dian vice-president deny
Co., Ltd. 2020
Wu Wha Ma International Co., Ltd. 20 April
Lin Ji Dian director deny
(Taiwan) 2020
Gold mine chain enterprise Co., Ltd 24 April
Lin Ji Dian chairman deny
(Taiwan) 2020
Lin Ji Dian Dali Investment Co., Ltd. (Taiwan) chairman deny
STAR COMGISTIC CAPITAL CO., 31 March
Lin Ji Dian chairman yes
LTD. (Taiwan) 2020
Ka Wang Enterprises Limited (Hong 1 April
Lin Ji Dian director deny
Kong) 2020
Lung Tai Development Limited 1 April
Lin Ji Dian director deny
(Hong Kong) 2020
PROWORLDINTERNATIONALLI 1 April
Lin Ji Dian director deny
MITED(BVI) 2020
PT. TSANNKUEN PROPERTY 1 April
Lin Ji Dian director deny
DEVELOPMENT INDONESIA 2020
AXA Insurance Agents Limited 1 June
Ivan Wang director deny
(Taiwan) 2018
Finance 1
Tsann Kuen (Taiwan) Enterprise Co.,
Ivan Wang Department December yes
Ltd.
Associate 2018
Wu Wha Ma International Co., Ltd. 31 July
Ivan Wang controller September deny
(Taiwan) 2025
Gold mine chain enterprise Co., Ltd 24 April
Ivan Wang controller deny
(Taiwan) 2020
Chairman and
Xiamen Tsannkuen Property Services 30 April
Cai Bingbo General deny
Co., Ltd. 2020
Manager
Tsann Kuen (Zhangzhou) Enterprise 12 May
Cai Bingbo director deny
Co., Ltd. 2020
Accounting Department, School of adjunct 1 August
Wu Yibing yes
Management, Xiamen University professor 2014
independent 18 July
Wu Yibing Leedarson IoT Technology Inc. yes
director 2019
G-bits Network Technology independent 13 January
Wu Yibing yes
(Xiamen) Co., Ltd. director 2022
Partner, June 1,
Liu Luhua Fujian Tianyi Law Firm yes
Director 1993
Liu Luhua Xiamen Arbitration Commission arbitrator yes
Associate
Xiamen University Tan Kah Kee 1 May
Liu Luhua Professor (Part- deny
College 2012
time)
independent 31 July
Liu Luhua Xiamen Chengtun Mining Co., Ltd. yes
director 2020
Yuanxiang (Xiamen) International independent 18 May
Liu Luhua yes
Airport Co. director 2023
Whether
remuneratio
Positions held n
Personnel Term start End of
Other organization names in other allowances
Name date term
organizations are received
from other
units
secretary- January 1,
Tang Jinmu Xiamen Asset Appraisal Association yes
general 2002
independent
Tang Jinmu Fujian Jinsen Forestry Co., Ltd. September Januar yes
director
Xiamen Tsannkuen Property Services 14 May
Wu Jianhua supervisor deny
Co., Ltd. 2019
Tsann Kuen (Zhangzhou) Enterprise
Wu Jianhua finance chief November deny
Co., Ltd.
Penalties by securities regulators against current and former directors and senior executives during
the reporting period
Applicable Inapplicable
Decision-making procedure, determination basis and actual payment of directors and senior
management personnel
Decision procedure: The remuneration of directors shall be reviewed and determined by the
shareholders' meeting, and that of senior executives by the board of directors.
The basis for this determination is that the company's Board of Directors' Nomination,
Compensation and Evaluation Committee is responsible for formulating evaluation criteria and
conducting assessments for directors and senior executives, as well as developing and reviewing
compensation policies and plans for them.
Compensation of Directors and Senior Management During the Reporting Period
Unit: 10,000 yuan
total pre- whether to
tax receive
surname deferred
Assess exe suspensi remunera remuneration
and Employm payment
sex age post ment cuti on of tion from the
personal ent status arrange
criteria on recovery received company's
name ment
from the related
company parties
Chairman
at present
Cai and
man 69 hold the 229.83 yes
Yuansong General
office of
Manager
at present
Lin Ji
man 57 director hold the 3.60 yes
Dian
office of
at present
Ivan
man 57 director hold the 3.60 yes
Wang
office of
Cai at present
man 41 director 3.60 deny
Bingbo hold the
total pre- whether to
tax receive
surname deferred
Assess exe suspensi remunera remuneration
and Employm payment
sex age post ment cuti on of tion from the
personal ent status arrange
criteria on recovery received company's
name ment
from the related
company parties
office of
at present
Wu independe
man 44 hold the 15.00 deny
Yibing nt director
office of
at present
independe
Liu Luhua man 56 hold the 12.00 deny
nt director
office of
at present
Tang independe
man 60 hold the 12.00 deny
Jinmu nt director
office of
at present
Wu finance
man 46 hold the 45.57 deny
Jianhua chief
office of
Secretary at present
Sun wom
Meimei an
Board office of
amount to 355.24
The assessment criteria for the actual remuneration received by all directors and senior
not applicable
executives at the end of the reporting period
Performance evaluation of actual compensation received by all directors and senior
not applicable
executives at the end of the reporting period
deferred compensation arrangements for all directors and officers at the end of the reporting
not applicable
period
Status of salary withholding and recovery for all directors and senior executives during the
not applicable
reporting period
Other circumstances
Applicable Inapplicable
V. Performance of Directors' Duties During the Reporting Period
presence of directors at board meetings and shareholders' meetings
Has the
Number of
individual
board Number of number of
Number of failed to number of
meetings board board absent
Director's board meetings attend two shareholders'
to attend meetings meetings from board
Name attended via consecutive meetings
during the attended in attended meetings
correspondence board attended
reporting person by proxy
meetings in
period
person
Cai
Yuansong
Lin Ji 5 0 4 1 0 deny 1
Dian
Ivan Wang 5 0 4 1 0 deny 0
Cai
Bingbo
Wu Yibing 5 4 1 0 0 deny 1
Tang
Jinmu
Liu Luhua 5 5 0 0 0 deny 1
Explanation for two consecutive absences from board meetings without personal attendance:
None
whether the director raises objections to the company's relevant matters
Yes No
During the reporting period, the directors did not raise any objections to the company's related
matters.
whether the directors' proposals to the company are adopted
Yes No
statement of directors on the adoption or non-adoption of relevant proposals
During the reporting period, the company's directors adhered to the principle of safeguarding
the paramount interests of the company and its shareholders. In compliance with relevant
regulations, they diligently fulfilled their duties by attending board meetings and shareholder
meetings, carefully deliberating on all proposals, and offering constructive suggestions on
corporate management. Their contributions significantly enhanced the board's decision-making
efficiency, elevated management standards, and standardized operational practices.
VI. Status of Special Committees under the Board of Directors during the
Reporting Period
Important
other Details
opinions
Committee Member Meetin Meeting performa of the
content of meeting and
Name Status g count date nce of objecti
suggestion
duties on
s proposed
CAI
Yuansong, Proposal on the Capital
LIN Jidian, Increase by the Controlling
Strategic 25 April
LIU Luhua, 2 Subsidiary Zhangzhou Cankun not have not have
Committee 2025
WU Yibing, to Its Wholly-Owned
TANG Grandson Company
Jinmu
CAI
Yuansong, 05 Company Development
Strategic
LIN Jidian, 2 December Strategy and 2026 Business not have not have
Committee
LIU Luhua, 2025 Focus
WU Yibing,
Important
other Details
opinions
Committee Member Meetin Meeting performa of the
content of meeting and
Name Status g count date nce of objecti
suggestion
duties on
s proposed
TANG
Jinmu
Nomination,
Liu Luhua, Annual Performance Report of
Remunerati
Cai 08 March Nomination, Compensation
on and 1 not have not have
Yuansong, 2025 and Assessment Committee in
Assessment
Wu Yibing 2024
Committee
Control Self-evaluation Report
Text and Report Summary
Settlement Plan
Distribution Proposal
Related Party Transactions
Proposal
Committee on the
Performance Evaluation and
Supervision of the Accounting
Firm in 2024
Wu Yibing, 7. Proposal for Reappointment
audit 08 March
Liu Luhua, 5 of the Accounting Firm not have not have
committee 2025
Tang Jinmu 8. Feasibility Analysis Report
on Financial Derivatives
Trading by Zhangzhou
Cankun, the Controlled
Subsidiary
Derivatives Trading by
Zhangzhou Cankun, the
Controlled Subsidiary
Management Authorization
Limit for the Controlled
Subsidiary Zhangzhou Cankun
management quota delegated
by Shanghai Cankun, the
holding subsidiary
Wu Yibing,
audit 25 April 1. First Quarter Report for
Liu Luhua, 5 not have not have
committee 2025 2025
Tang Jinmu
Wu Yibing,
audit 07 August 1. Full text and summary of
Liu Luhua, 5 not have not have
committee 2025 the 2025 semi-annual report
Tang Jinmu
Wu Yibing, 28
audit
Liu Luhua, 5 October 1. Q3 2025 Report not have not have
committee
Tang Jinmu 2025
audit Wu Yibing, 5 05 1.2026 Annual Audit Plan not have not have
Important
other Details
opinions
Committee Member Meetin Meeting performa of the
content of meeting and
Name Status g count date nce of objecti
suggestion
duties on
s proposed
committee Liu Luhua, December
Tang Jinmu 2025
VII. Work of the Audit Committee
The audit committee identified potential risks in the company's operations during its supervisory
activities during the reporting period.
Yes No
The Board of Auditors has no objection to the audit matters during the reporting period.
VIII. Company Employee Status
Number of employees in the parent company at the end of the reporting
period
Number of employees in key subsidiaries at the end of the reporting
period
Total number of employees at the end of the reporting period 3,481
Total number of employees receiving salary in the current period
(people)
Number of retired employees whose costs are borne by the parent
company and its major subsidiaries
professional composition
Category of professional structure Number of professionals (people)
operating personnel 2,278
salesman 82
artisan 432
financial staff 43
clerical staff 646
amount to 3,481
educational status
Education level category Number (people)
doctor 1
Master 13
scholar 268
junior college 305
Below college level 2,894
amount to 3,481
In compliance with the Labor Law, the company's Internal Personnel Management Rules, and
relevant laws and regulations, and in alignment with its strategic planning, the company has
established a position-based compensation system that aligns with market human resource
allocation, employment needs, and job responsibilities. The company has also formulated the
Compensation Management Measures and the Performance Evaluation Management Measures.
Employee compensation levels are determined based on the company's operational status and
profitability, internal fairness, as well as the value of the position, work performance, and
individual capabilities.
Applicable Inapplicable
Total man-hours (hour) 1,311,979.50
Total remuneration paid (RMB Yuan) 11,106,084.80
IX. Profit Distribution and Conversion of Capital Reserve into Share Capital
Policy formulation, implementation, or adjustment of profit distribution, particularly cash
dividends, during the reporting period
Applicable Inapplicable
In 2025, the company's first board meeting approved the 2024 annual profit distribution plan.
The 2024 Annual General Meeting, held on May 16,2025, further approved the distribution
proposal: based on the total share capital of 185,391,680 shares at the end of 2024, a cash dividend
of RMB 1.8 per 10 shares (tax inclusive) would be distributed to all shareholders. This policy
aligns with the company's "Shareholder Return Plan for the Next Three Years (2024-2026)". The
distribution was fully implemented on June 13,2025. No rights issues or new share issuances
occurred during the reporting period.
special note on cash dividend policy
Whether it complies with the provisions of the company's articles of association
yes
or the requirements of the shareholders' meeting resolution:
Are the dividend standards and ratios clear and explicit? yes
Whether the relevant decision-making procedures and mechanisms are complete: yes
Whether the independent directors have fulfilled their duties and played their due
yes
roles:
If the company does not distribute cash dividends, it must disclose the specific
not applicable
reasons and outline the measures to be taken to enhance investor returns.
Whether the minority shareholders have the opportunity to express their opinions
and demands, and whether their legitimate rights and interests are fully yes
protected:
Whether the conditions and procedures for adjusting or changing the cash
not applicable
dividend policy are compliant and transparent.
The company reported profits during the reporting period, and while the parent company's
distributable profits to shareholders were positive, it did not propose a cash dividend distribution
plan.
Applicable Inapplicable
Profit Distribution and Capital Reserve Conversion into Share Capital During the Reporting
Period
Applicable Inapplicable
Number of bonus shares per 10 shares -
Dividend per 10 shares (RMB) (tax included) 1.00
Number of shares to be issued for every 10 shares held -
capital base of allotment plan 185,391,680.00
Cash dividend amount (RMB) (tax included) 18,539,168.00
Cash dividends (in yuan) from other methods (e.g., share repurchase) -
Total cash dividends (including other methods) (RMB) 18,539,168.00
Distributable profit (RMB) 409,158,233.05
cash dividend total (including other methods) as a percentage of total profit
distribution
cash dividend
For companies in the mature growth phase with no major capital expenditure plans, cash dividends must constitute
at least 80% of the total profit distribution.
Detailed explanation of profit distribution or capital reserve conversion plan
For the fiscal year 2025, the company plans to distribute a cash dividend of RMB 1.0 per 10 shares (tax inclusive)
to all shareholders. The total profit allocated for distribution is estimated at RMB 18,539,168.00, with the
remaining undistributed profit of RMB 390,619,065.05 carried forward to the next fiscal year. No capital reserve
conversion into share capital will be implemented this year.
X. Implementation Status of the Company's Equity Incentive Plan, Employee
Stock Ownership Plan, and Other Employee Incentive Measures
Applicable Inapplicable
The company reported no equity incentive plans, employee stock ownership plans, or other
employee incentive measures during the reporting period, nor any implementation of such
measures.
XI. Development and Implementation of Internal Control Systems During the
Reporting Period
system.
defined responsibilities and standardized procedures.
which plays a positive role in ensuring the company's stable operations.
Yes No
XII. Management and Control of Subsidiaries During the Reporting Period
None
XIII. Internal Control Evaluation Report or Internal Control Audit Report
full disclosure date of internal
control evaluation report
index of disclosure of full text of
www.cninfo.com.cn
internal control evaluation report
the ratio of total assets of units
included in the evaluation scope to
the total assets of the company's
consolidated financial statements
The proportion of operating
revenue of the evaluated entity in
the consolidated financial
statements of the company
standard of defect determination
class financial reports non financial report
Major defect: A combination of Major Defect: Safety-Multiple
one or more control deficiencies in employee deaths, company
an enterprise that results in a reputation-Negative news spread
significant deviation from the nationwide, government or
control objectives. regulatory authorities conduct
Qualitative criteria Material deficiency: a combination investigations, public concern
of one or more deficiencies in a arises, resulting in significant
company's controls that are less customer attrition, or may require
severe and have less economic press release for clarification
consequences than a material Major Defect: Safety-Causing
deficiency, but may still cause the disability or death of an employee
company to deviate from its or citizen; Corporate Reputation-
control objectives. Negative news spreading
Common Defects: Internal Control nationwide, complaints filed with
Defects in Financial Reporting media, or resulting in customer
That Do Not Constitute Material or contract termination
Significant Defects General defect: has occurred or is
about to cause health harm to
employees or citizens. Company
reputation-negative news spreads
in a certain area, causing
considerable damage to the
company's reputation.
Critical violations:>5% of total
consolidated profit in the most
recent period>1% of total
consolidated assets in the most
recent period>2% of total
consolidated revenue in the most
recent period. These actions
constitute serious breaches of laws,
regulations, rules, and government
policies, resulting in industry exit
restrictions, revocation of business
licenses, or compulsory closure.
Critical deficiencies:> 3%~5% of Major defect: RMB 5 million
the most recent consolidated (inclusive) or more
financial statement's total profit> Critical flaw: Between RMB 1
quantitative criteria 0.5%~1% of the most recent million (inclusive) and RMB 5
consolidated financial statement's million (inclusive)
total assets> 1%~2% of the most General defect: less than RMB 1
recent consolidated financial million
statement's operating revenue
General Defect: <3% of the most
recent consolidated financial
statement's total profit, <0.5% of
the most recent consolidated
financial statement's total assets,
<1% of the most recent
consolidated financial statement's
operating revenue, in violation of
laws, regulations, rules, or
government policies, resulting in
fines or penalties.
Number of material deficiencies in
financial reports
Number of material deficiencies in
non-financial reporting
Number of material deficiencies in
financial statements
Number of material non-financial
reporting deficiencies
Applicable Inapplicable
auditing opinion paragraph
On December 31,2025, Xiamen Cancun Company maintained effective internal controls over financial
reporting in all material aspects, in compliance with the 'Basic Standards for Enterprise Internal Control' and
relevant regulations.
disclosure of internal control audit report publish
full disclosure date of internal control audit report 10 March 2026
index of disclosure of full text of internal control audit
http://www.cninfo.com.cn
report
Internal control audit report opinion type unqualified standard opinion
whether there is material defect in the non financial
deny
report
Does the Accounting Firm Issue Internal Control Audit Report with Non-standard Opinion
Yes No
Is the Internal Control Audit Report Issued by the Accounting Firm Consistent with the Self-
Evaluation Report Opinion of the Board of Directors?
Yes No
XIV. Rectification of Self-Inspection Issues in the Special Governance Action for
Listed Companies
None
XV. Disclosure of Environmental Information
Listed Companies and Their Major Subsidiaries Included in the List of Enterprises Disclosing
Environmental Information According to Law
Yes No
XVI. Social Responsibility Status
None
XVII.Consolidation and Expansion of Poverty Alleviation Achievements and
Rural Revitalization
None
Section V:Significant Events
I. Implementation Status of Commitments
itself shall ensure that all commitments made to relevant parties during the reporting period
are fulfilled, including any commitments remaining unfulfilled as of the reporting period's
end.
Applicable Inapplicable
time
limit
Commitment Commitment Commitme Commitme Implementation
Commitment content for
Reason Party nt type nt time status
accep
tance
With confidence in the
company's future
sustainable growth, the
shareholder will
increase holdings if the
share price falls below
HKD2.40 per share The company's
after the share shares resumed
reduction plan and trading on
resumption of trading. December
The plan allows for a 31,2012. Since
maximum 2% increase then, Qiaomin
(3.7078 million shares) Investment
other stock share long
FILLMAN of the company's total 28 Limited has not
commitments to increase term
INVESTMENT issued shares within December increased its
minority commitme effect
S LIMITED twelve months from the 2012 holdings, as the
shareholders nt ive
initial purchase date. If closing price
the 2% share increase remained below
is completed within HKD2.40,
this period and the failing to meet
price reaches the target the threshold
level, the shareholder for share
will apply to the China purchase.
Securities Regulatory
Commission (CSRC)
for approval to
continue the share
purchase without a
tender offer.
Commitment to
yes
fulfill on time
If the
commitment is
not fulfilled by not have
the deadline, the
specific reasons
for the failure and
the next steps
should be clearly
explained.
remains within the forecast period. The company must provide an explanation of how the
assets or projects met the original profit forecast and the reasons for this outcome.
Applicable Inapplicable
Applicable Inapplicable
II. Non-operational Use of Funds by Controlling Shareholders and Related
Parties
Applicable Inapplicable
III. Violations in External Guarantees
Applicable Inapplicable
IV. Board of Directors' Statement on the Recent Non-Standard Audit Report
Applicable Inapplicable
V. Explanation by the Board of Directors and Independent Directors (if any) on
the Non-Standard Audit Report of the Accounting Firm for the Reporting
Period
Applicable Inapplicable
VI. Explanation of Changes in Accounting Policies, Accounting Estimates, or
Significant Correction of Accounting Errors Compared to the Previous Year's
Financial Report
Applicable Inapplicable
VII. Explanation of Changes in the Scope of Consolidated Financial Statements
Compared to the Previous Year's Report
Applicable Inapplicable
VIII. Appointment and Dismissal of Accounting Firms
Current accounting firm
Lixin Accounting Firm (Special General
name of domestic accounting firm
Partnership)
Remuneration of Domestic Accounting Firms (Ten
Thousand Yuan)
continuous years of audit services of domestic accounting
firms
name of CPA of domestic accounting firm Hu Jingdong, Li Puqi
continuous years of audit services by certified public
accountants of domestic accounting firms
Change of accounting firm in the current period
Yes No
Engaging of Internal Control Audit Firms, Financial Advisors, or Sponsors
Applicable Inapplicable
IX. Delisting Risk Following Annual Report Disclosure
Applicable Inapplicable
X. Matters Related to Bankruptcy Reorganization
Applicable Inapplicable
XI. Major Litigation and Arbitration Matters
Applicable Inapplicable
XII. Penalties and Rectification Status
Applicable Inapplicable
XIII. Integrity Status of the Company, Its Controlling Shareholders, and Actual
Controllers
Applicable Inapplicable
XIV. Major Related Party Transactions
Applicable Inapplicable
Unit: 10,000 yuan
principle of related settlement available
related amount of Proportion of approved Exceeds the
incidence Related Party related party party method of market price Disclosure Disclosure
related party transaction related transaction transaction approved
relation Transactions transaction transacti related party of comparable date Index
content transactions amount (%) limit limit
pricing on price transaction transaction
Procurement
Thermaster of raw
controlled
Electronic Buy materials, 2,445.29 2.83 3,500.00 deny
company
(Xiamen) Ltd. parts, and Based on market settlement
components prices, both
according to
parties adhere to www.cninfo.
not have the contract not have 11-Mar-25
the principles of com.cn
signed by both
fairness and
parties
STAR reasonableness.
ultimate Sales of parts
COMGISTIC
holding Selling goods and finished 321.71 0.24 600 deny
CAPITAL CO.,
company products
LTD.
amount to 2,767.00 4,100.00
Details of significant sales returns None
Actual performance during the reporting period for related-
party transactions relevant to routine operation expected to None
occur during the period and estimated by category
Reasons for significant differences in transaction prices from
None
market reference prices
Applicable Inapplicable
Applicable Inapplicable
Applicable Inapplicable
whether there are non-operating related creditor-debtor transactions
Yes No
Applicable Inapplicable
Applicable Inapplicable
Applicable Inapplicable
XV. Major Contracts and Their Performance
(1) Custody Status
Applicable Inapplicable
(2) Contracting Status
Applicable Inapplicable
(3) Rental Status
Applicable Inapplicable
Applicable Inapplicable
Unit: 10,000 yuan
disclosure date of Actual actual guarantee to
Guarantee type of thing counter period of
credit facility guarantee amount occurrence amount of fulfilled a related
recipient name guarantee pledged security guarantee
announcement date security party
PT.STAR 50% credit
COMGISTIC 2025-4-26 3,750.00 0.00 pledge + 50% not have annum deny deny
year
INDONESIA capital
PT.STAR
COMGISTIC 2025-10-29 2,250.00 361.00 pledge 100% credit not have annum deny deny
year
INDONESIA
Total actual amount of
Total approved guarantee amount for
guarantees provided to
subsidiaries during the reporting period 6,000.00 1,400.00
subsidiaries during the
(C1)
reporting period (C2)
Total actual guarantee
Total approved guarantee limits for
balance of subsidiaries at
subsidiaries at the end of the reporting 6,000.00 361.00
the end of the reporting
period (C3)
period (C4)
Total amount of company guarantees (i.e. the sum of the first three items)
Total actual amount of
Total approved credit line during the
reporting period (C1)
reporting period (C2)
Total actual guarantee
Total approved guarantee amount at the
end of the reporting period (C3)
(C4)
Total actual collateral (i.e. C4) as a percentage of the company's net assets 0.33%
among ：
Balance of guarantees provided to shareholders, actual controllers, and their
affiliates (D)
The balance of debt guarantees provided directly or indirectly to guaranteed
entities with a debt-to-asset ratio exceeding 70% (E)
Amount of the guarantee exceeding 50% of the net assets (F) 0.00
The total amount of the three guarantees (D+E+F) 0.00
Statement of unexpired guarantees where guarantee liabilities have been
incurred or joint and several liabilities may be assumed during the reporting not have
period
statement of providing guarantee to the outside in violation of prescribed
not have
procedure
The Specific Situation of the Guarantee of the Compound Method
not have
(1) Entrusted Financial Management
Applicable Inapplicable
(2) Entrusted Loan Status
Applicable Inapplicable
Applicable Inapplicable
XVI. Use of Raised Funds
Applicable Inapplicable
XVII. Explanation of Other Significant Matters
Applicable Inapplicable
XVIII. Major Matters of the Company's Subsidiaries
Applicable Inapplicable
Section VI Shareholding Changes and Shareholder Status
I. Shareholding Changes
Unit: shares
Before this change Change (+, -) After this change
conver
bonu sion of
new
quantity scale s provid other subtotal quantity scale
issue
share ent
fund
non-tradable 0 0.00% 0 0.00 0.00 0.00 0.00 0 0.00%
shares
shares
of which:
state-owned shares
share of a
domestic legal
person
shareholding
by foreign legal
person
other
Corporate Shares
Employee Stock
shares or other
II. Shares Already
Listed and 185,391,680 100.00% 0 0 0 0 0 185,391,680 100.00%
Circulating
Common Stock
owned shares 185,391,680 100.00% 0 0 0 0 0 185,391,680 100.00%
listed in China
shares listed
overseas
III. Total Number
of Shares
reasons for share change
Applicable Inapplicable
approval of share change
Applicable Inapplicable
transfer of share change
Applicable Inapplicable
Effect of Share Changes on Financial Indicators Including Basic Earnings Per Share, Diluted
Earnings Per Share, and Net Assets Per Share Belonging to Common Shareholders in the Recent
Year and Period
Applicable Inapplicable
other information deemed necessary by the company or required by securities regulatory authorities
Applicable Inapplicable
Applicable Inapplicable
II. Securities Issuance and Listing Status
Applicable Inapplicable
structure of company assets and liabilities
Applicable Inapplicable
Applicable Inapplicable
III. Shareholders and Actual Controllers
Unit: shares
Total number Number of
of common preferred Total number of preferred
Number of
shareholders stockholders shareholders with restored
common
as of the end with restored voting rights as of the end
stockholders at 12,958 12,866 0 0
of the month voting rights of the month preceding the
the end of the
preceding the at the end of annual report disclosure
reporting period
annual report the reporting date
disclosure date period
Shareholding status of shareholders holding more than 5% or the top 10 shareholders (excluding shares lent through securities
lending)
Increase or number pledge, mark or
number of decrease of number of freeze
Shareholder nature of shareholdi
shares held at during the unlisted shares in qua
name shareholders ng ratio share
end of period reporting shares circulation ntit
status
period held y
FORDCHEE not
foreign legal
DEVELOPME 29.10% 53,940,530.00 invariant 0 53,940,530.00 applicabl 0
person
NT LIMITED e
EUPA
not
INDUSTRY foreign legal
CORPORATIO person
e
N LIMITED
FILLMAN not
foreign legal
INVESTMENT 2.49% 4,621,596.00 invariant 0 4,621,596.00 applicabl 0
person
S LIMITED e
natural person not
Cao Yifan within the 1.13% 2,094,000.00 Tan Tien 0 2,094,000.00 applicabl 0
territory e
not
Yong quan Domestic
Chen Natural Person
e
not
Overseas
Chen Lijuan 0.94% 1,733,768.00 100,000 0 1,733,768.00 applicabl 0
Natural Person
e
not
Overseas
Chen Yongqing 0.89% 1,658,078.00 invariant 0 1,658,078.00 applicabl 0
Natural Person
e
China
Merchants Foreign- not
Securities funded Legal 0.72% 1,338,538.00 347,905 0 1,338,538.00 applicabl 0
(Hong Kong) Person e
Limited
not
Domestic
Ding Xiaolun 0.63% 1,170,100.00 100 0 1,170,100.00 applicabl 0
Natural Person
e
not
Domestic
Yang Wenliang 0.61% 1,131,471.00 -434,859 0 1,131,471.00 applicabl 0
Natural Person
e
Strategic investors or general
legal persons become top 10
not have
shareholders due to new share
allotment
The first, second, and third largest shareholders are the company's legal controlling
Explanation of the above- shareholders. The company is unaware whether there are any related-party relationships
mentioned shareholder among the other circulating shareholders, nor whether they constitute acting-in-concert
relationships or concerted actions parties as defined under the "Measures for the Disclosure of Information on Changes in
Shareholding by Shareholders of Listed Companies".
Explanation of the above
shareholders' proxy voting rights not have
and voting rights waiver
Special Note on the Existence of a
Dedicated Account for Share
not have
Repurchase among the Top 10
Shareholders
Top 10 circulating shareholders 'holdings (excluding shares lent through securities lending and executives' restricted shares)
number of shares outstanding at the end of stock class
Shareholder name
the reporting period stock class quantity
FORDCHEE DEVELOPMENT
LIMITED
EUPA INDUSTRY
CORPORATION LIMITED
FILLMAN INVESTMENTS
LIMITED
Cao Yifan 2,094,000.00 listed foreign shares 2,094,000.00
Yong quan Chen 2,028,476.00 listed foreign shares 2,028,476.00
Chen Lijuan 1,733,768.00 listed foreign shares 1,733,768.00
Chen Yongqing 1,658,078.00 listed foreign shares 1,658,078.00
China Merchants Securities
(Hong Kong) Limited
Ding Xiaolun 1,170,100.00 listed foreign shares 1,170,100.00
Yang Wenliang 1,131,471.00 listed foreign shares 1,131,471.00
Explanation of related party
relationships or concerted actions The first, second, and third largest shareholders are the company's legal controlling
among the top 10 shareholders shareholders. The company is unaware whether there are any related-party relationships
holding unrestricted tradable among the other circulating shareholders, nor whether they constitute acting-in-concert
shares, and between these top 10 parties as defined under the "Measures for the Disclosure of Information on Changes in
shareholders and the top 10 Shareholding by Shareholders of Listed Companies".
shareholders in general.
Explanation of the Top 10
Common Stockholders'
not have
Participation in Margin Trading
and Short Selling
Shareholding status of shareholders holding over 5% equity, top 10 shareholders, and top 10
unrestricted tradable shareholders participating in securities lending business
Applicable Inapplicable
The top 10 shareholders and the top 10 unrestricted tradable shareholders have changed from the
previous period due to margin lending and repayment activities.
Applicable Inapplicable
Did the company's top 10 common shareholders and top 10 unrestricted common shareholders
execute any agreed repurchase transactions during the reporting period?
Yes No
The company's top 10 common shareholders and top 10 unrestricted common shareholders did not
conduct any agreed repurchase transactions during the reporting period.
Nature of controlling shareholder: foreign holding
Type of controlling shareholder: legal entity
Legal
name of controlling date of
Representative/Unit Organization code principal business
shareholder establishment
Head
Fochi Development
Cai Yuansong January 3, 1990 269100 invest
Co., Ltd.
Uber Industrial Co.,
Cai Shuhui 21 July 1989 258847 invest
Ltd.
Overseas Chinese
Investment Co., Cai Shuhui 21 July 1992 369423 invest
Ltd.
Equity holdings of
controlling
shareholders in
other domestic and not have
overseas listed
companies during
the reporting period
Controlled Shareholder Changes During the Reporting Period
Applicable Inapplicable
Nature of actual control: foreign natural person
Type of actual controller: Individual
whether to obtain
Name of the actual relationship with the
nationality residency in other
controller actual controller
countries or regions
Wu Cankun self Taiwan, China deny
Main occupations and
Group Founder
positions
Listed Companies in
China and Abroad That The actual controllers of (Taiwan) Cankun Industrial Co., Ltd., (Taiwan) Canxing
Have Been Controlled in Netcom Co., Ltd., and (Taiwan) Canxing International Travel Service Co., Ltd.
the Past 10 Years
Change of actual controller during reporting period
Applicable Inapplicable
The actual controller of the company remained unchanged during the reporting period.
Diagram of the ownership and control relationship between the company and the actual
controller
actual controller exercising control over the company through trust or other asset management
mechanisms
Applicable Inapplicable
largest shareholder and their acting-in-concert parties accounts for 80% of their total
holdings.
Applicable Inapplicable
Applicable Inapplicable
Restructuring Parties and Other Commitment Entities
Applicable Inapplicable
IV. Implementation of Share Repurchase During the Reporting Period
progress of share repurchase
Applicable Inapplicable
Progress of the implementation of the reduction and repurchase of shares by means of
centralized bidding
Applicable Inapplicable
V. Information on PreferredShares
Applicable Inapplicable
The company has no preferred stock during the reporting period.
Section VII Bonds
Applicable Inapplicable
No preference shares in this reporting period.
Section VIII Financial Report
I.audit report
Audit opinion type unqualified standard opinion
date of audit report 7 March 2026
Auditing Organization Name Lixin Accounting Firm (Special General Partnership)
Audit report document number Xin Kuai Shi Bao Zi [2026] No. ZA10214
Certified Public Accountant's Name Hu Jingdong, Li Puqi
II.financial statement (attached)
Chairman: Cai Yuansong
The Board of Directors of Tsann Kuen (China) Enterprise Co., Ltd.
TSANN KUEN (CHINA) ENTERPRISE CO.,
LTD.
AUDITOR'S REPORT AND FINANCIAL
STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
ENGLISH TRANSLATION OF AUDITOR’S
REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
IF THERE IS ANY CONFLICT BETWEEN THE
CHINESE VERSION AND ITS ENGLISH
TRANSLATION, THE CHINESE VERSION
WILL PREVAIL
Tsann Kuen (China) Enterprise Co., Ltd.
Auditor's Report and Financial Statements
(From 1 January 2025 to 31 December 2025)
Table of Contents Page
I. Auditor's Report 1-6
II. Financial Statements
Consolidated and Company's Balance Sheets 1-4
Consolidated and Company's Income Statements 5-6
Consolidated and Company's Statements of Cash Flows 7-8
Consolidated and Company's Statements of Changes in Shareholders' 9-12
Equity
Notes to the Financial Statements 1-130
Auditor's Report
(English Translation for Reference Only)
Xin Kuai Shi Bao Zi [2026] No. ZA10214
To the Shareholders of Tsann Kuen (China) Enterprise Co., Ltd.:
Opinion
We have audited the accompanying financial statements of Tsann Kuen (China) Enterprise
Co., ( “ TKC ” ), which comprise the consolidated and company's balance sheets as at 31
December 2025, the consolidated and company's income statements, the consolidated and
company's statements of cash flows, and the consolidated and company's statements of
changes in owners' equity for the year then ended, and notes to the financial statements.
In our opinion, the accompanying financial statements present fairly, in all material respects,
the consolidated and company's financial position as at 31 December 2025 and the
consolidated and company's financial performance and cash flows for the year then ended in
accordance with the requirements of Accounting Standards for Business Enterprises.
Basis for Opinion
We conducted our audit in accordance with China Standards on Auditing (“CSAs”). Our
responsibilities under those standards are further described in the Auditor's Responsibilities
for the Audit of the Financial Statements section of our report. We are independent of TKC in
accordance with China Independence Standard for Certified Public Accountants No. 1 –
Independence for Audit and Review Engagements and China Code of Ethics for Certified
Public Accountants ( “ the CICPA Code ” ) and have fulfilled our other ethical
responsibilities in accordance with the CICPA Code. The independence requirements for
audits of public interest entities have been applied in our audit. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the current period. These matters were
addressed in the context of our audit of the financial statements as a whole, and in forming
our opinion thereon, and we do not provide a separate opinion on these matters.
We identified the following key audit matters in our audit:
Key Audit Matters How these matters were addressed in the audit
Refer to Note V (34) to the financial Audit response
statements, TKC's operating income for the
year ended 31 December 2025 amounted to Regarding revenue recognition of TKC, audit
CNY 1,344,775,556.24, representing an procedures we performed primarily included:
decrease of 20.95% compared to the previous
period. (1) Understanding and evaluating the design
and operating effectiveness of key internal
Since operating income is one of TKC's key controls related to revenue recognition by
performance indicators and since changes in management.
gross margin have a significant impact on
TKC's operating results for the current period, (2) Reviewing sales contracts, on sample basis,
Key Audit Matters How these matters were addressed in the audit
revenue recognition is determined as a key and collaborating with interviews with
audit matter. management, to identify contract terms and
conditions related to the transfer of control
over goods and to evaluate whether the timing
of revenue recognition for product sales is in
compliance with the requirements of
Accounting Standards for Business Enterprises.
(3) For domestic sales, examining supporting
documents, on sample basis, related to revenue
recognition, including sales contracts, orders,
sales invoices, goods delivery notes, customer
receipts, etc.
For export sales, agreeing electronic port
information with accounting records, and
examining, on sample basis, supporting
documents such as sales contracts, export
customs declarations, sales invoices, etc.
(4) Sending confirmations to major customers
to verify sales amounts. For non-replied
confirmations, we performed alternative
procedures by examining sales contracts,
delivery notes, shipping documents, export
customs declarations, bills of lading, sales
invoices, etc.
(5) Examining cash receipt records, sales
invoices, export customs declarations, bills of
lading, customer receipts, and sales remittance
documents in relation to the sales transactions,
on sample basis, recorded in current year. We
also confirmed accounts receivable balances at
period-end to verify existence of revenue.
(6) Performing analytical procedures, including
revenue, cost, and gross margin fluctuations
analysis between the current and previous
periods; flux analysis by month in relation to
revenue, cost, and gross margin fluctuations;
using factor analysis to evaluate the impact of
various factors on gross profit and assessing
the reasonableness of these impacts.
(7) Cut-off test on revenue recognized before
and after the balance sheet date, including
examining delivery notes, customs
declarations, bills of lading, and other
supporting documents to ensure that revenue
was recorded in the correct accounting period.
(8) We assessed and monitored the client ’ s
business operations and their collaboration
with TKC by combining methods such as
email interviews and public channel inquiries.
Key Audit Matters How these matters were addressed in the audit
Refer to Note V (6) to the financial statements, Audit response
as at 31 December 2024, TKC's inventory
balance was CNY 215,823,595.28, with an Regarding inventory provisions for TKC, the
inventory provision of CNY 22,105,533.83. audit procedures we performed primarily
included:
On the balance sheet date, management
performs impairment tests on inventory. (1) Understanding and evaluating the design
Provision for decline in the value of and operating effectiveness of internal controls
inventories is determined at the excess amount related to inventory provisions made by
of the carrying amounts of the inventories over management.
their net realisable value. Net realisable value
is determined based on the estimated selling (2) Understand the inventory impairment
price of the inventory, less the estimated costs provision policy, compare it with those of peer
to completion and estimated costs necessary to companies in the same industry, and evaluate
make the sale and related taxes. Significant whether it complies with the Accounting
judgments and assumptions are involved by Standards for Enterprises.
management in these forecasts, particularly
regarding future selling prices, production (3) Reviewing costing data and performing
costs, operating expenses, and related taxes. analysis on material, labor, and overhead costs
Given the complexity involved in the for major products by year and by month.
inventory impairment testing process on yearly
basis, which requires critical judgments and Obtaining an inventory aging analysis
estimates, inventory provision is determined as prepared by management and evaluating
a key audit matter. inventory aging and inventory turnover,
collaborating discussing with management on
TKC's inventory provision policies to assess
the reasonableness of inventory provisions.
(4) Physical inventory count observation to
examine the quantity and condition of
inventory items. Special attention was given to
high-value or slow-moving inventory items.
(5) For products where public market sales
prices are available, independently querying
public market price information and comparing
it with the estimated selling prices used by
management in determining inventory
provision.
(6) For products where public market sales
prices are not available, comparing the
estimated selling prices with actual selling
prices from recent transactions or post-period
sales, on sample basis.
(7) Comparing the costs incurred to complete
similar raw materials and work-in-progress
during the year, on sample basis, to evaluate
Key Audit Matters How these matters were addressed in the audit
the reasonableness of TKC's estimates of costs
to complete production.
Other Information
Management of TKC (“Management”) is responsible for the other information. The other
information comprises all of the information included in the 2025 annual report of TKC, other
than the financial statements and our auditor's report thereon.
Our opinion on the financial statements does not cover the other information and we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the audit or otherwise appears to
be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of
the other information, we are required to report that fact. We have nothing to report in this
regard.
Responsibilities of Management and Those Charged with Governance for the Financial
Statements
Management is responsible for the preparation and fair presentation of the financial
statements in accordance with the requirements of Accounting Standards for Business
Enterprises, and for such internal control as management determines is necessary to enable
the preparation of financial statements that are free from material misstatement, whether due
to fraud or error.
In preparing the financial statements, management is responsible for assessing TKC's ability
to continue as a going concern, disclosing, if applicable, matters related to going concern and
using the going concern basis of accounting unless management either intends to liquidate
TKC or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing TKC’s financial reporting
process.
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is a high level of assurance,
but is not a guarantee that an audit conducted in accordance with CSAs will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with CSAs, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those
risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for
our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
(2) Obtain an understand of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
(4) Conclude on the appropriateness of management's use of the going concern basis
of accounting and, based on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant doubt on TKC's ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the financial
statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions
are based on the audit evidence obtained up to the date of our auditor's report. However,
future events or conditions may cause TKC to cease to continue as a going concern.
(5) Evaluate the overall presentation (including the disclosures), structure and contents
of the financial statements, and whether the financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of
the entities or business activities within TKC to express an opinion on the consolidated
financial statements. We are responsible for the direction, supervision and performance
of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any significant
deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with
relevant ethical requirements regarding independence, and communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence
and, where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those
matters that were of most significance in the audit of the financial statements of the current
period and are therefore the key audit matters. We describe these matters in our auditor's
report unless law or regulation precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter should not be communicated in our
report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
BDO CHINA Shu Lun Pan Certified Public Accountant of China:
Certified Public Accountants LLP (Engagement Partner)
Certified Public Accountant of China:
Shanghai, China March 7, 2026
Tsann Kuen (China) Enterprise Co., Ltd.
Consolidated Balance Sheet
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Item Notes 31/12/2025 31/12/2024
Current Assets:
Cash and Cash equivalents V.1 460,847,776.00 444,377,943.52
Settlements Provision
Loans to banks and other financial institutions
Financial assets held for trading V.2 50,942,083.33
Derivative Financial instrument
Notes receivable
Accounts receivable V.3 139,969,323.13 203,955,899.80
Financing receivable
Prepayments V.4 4,955,253.01 4,318,758.91
Insurance premium receivable
Due from reinsurers
Provision of reinsurance contract reserve receivable
Other receivables V.5 21,608,192.98 27,902,480.51
Financial assets purchased under agreements to resell
Inventories V.6 193,718,061.45 194,399,523.78
including：Data Resources
Contractual asset
Held for sale assets
Current portion of non-current assets V.7 555,877,899.74 51,260,694.44
Other current assets V.8 288,286,038.04 554,336,979.01
Total Current Assets 1,665,262,544.35 1,531,494,363.30
Non-Current Assets：
Loans and advances
Debt investment V.9 208,602,148.68 540,534,660.69
Other debt investment
Long-term receivables
Long-term equity investment V.10 7,884,938.82
Other equity instrument investment V.11 40,000.00 40,000.00
Other non-current financial instrument
Investments properties V.12 18,560,118.67 19,287,755.23
Fixed assets V.13 162,861,863.08 146,795,190.83
Construction in process V.14 14,770,911.87 3,462,300.89
Productive biological assets
Oil and gas assets
Right-of-use assets V.15 340,387,210.22 353,943,869.92
Intangible assets V.16 10,806,092.17 11,947,318.66
including：Data Resources
Development expenditures
including：Data Resources
Goodwill
Long-term prepaid expenses V.17 3,395,913.29 5,571,380.26
Deferred tax assets V.18 15,842,586.55 11,872,802.85
Other non-current assets V.19 6,273,764.94 10,099,186.11
Item Notes 31/12/2025 31/12/2024
Total Non-current Assets 789,425,548.29 1,103,554,465.44
Total Assets 2,454,688,092.64 2,635,048,828.74
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Consolidated Balance Sheet (continued)
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Item Notes 31/12/2025 31/12/2024
Current Liabilities:
Short- term borrowings
Borrowing from the central bank
Deposits and balances from banks and other
financial institutions
Financial liabilities held for trading
Derivative financial liabilities
Notes payable V.21 2,224,816.88 19,418,627.35
Accounts payable V.22 383,868,393.34 517,321,517.29
Received in advance V.23 2,382,045.58 2,924,333.25
Contractual liability V.24 23,617,663.18 16,296,739.65
Financial assets sold under agreements to buy
Customer deposits and balances from banks and other
financial institutions
Customer brokerage deposits
Securities underwriting brokerage deposits
Employee Benefits Payable V.25 58,319,624.45 53,957,022.40
Taxes payable V.26 7,067,320.13 18,310,394.76
Other payables V.27 28,579,322.67 40,877,557.33
Fees and commission payable
Payable reinsurance
Liabilities classified as held for sale
Current portion of non-current liabilities V.28 476,624.15 922,678.70
Other current liabilities
Total Current Liabilities 506,535,810.38 670,028,870.73
Non- current Liabilities:
Insurance reserves
Long-term borrowings
Bonds payable
including: Preference share
Perpetual debt
Lease liabilities V.29 401,559,564.79 396,004,620.97
Long-term payables
Long- term employee payables
Provisions
Deferred income
Deferred Tax liabilities
Other non- current liabilities
Total Non -current Liabilities 401,559,564.79 396,004,620.97
Total Liabilities 908,095,375.17 1,066,033,491.70
Owners Equity( or Shareholders Equity) :
Share Capital V.29 185,391,680.00 185,391,680.00
Other equity instrument
Including: preference share
perpetual capital securities
Capital reserves V.31 296,808,965.79 296,808,965.79
Less: Treasury stock
Other comprehensive income V.32 8,287,226.27 11,252,746.52
Special reserves
Surplus reserves V.33 86,780,627.31 81,427,732.56
General reserve
Retained earnings V.34 512,340,440.03 527,518,517.81
Equity attributable to owners of the parent 1,089,608,939.40 1,102,399,642.68
Non-controlling interests 456,983,778.07 466,615,694.36
Total Equity 1,546,592,717.47 1,569,015,337.04
Total Liabilities and Equity 2,454,688,092.64 2,635,048,828.74
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Company’s Balance Sheet
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Item Notes 31/12/2025 31/12/2024
Current Assets:
Cash and Cash equivalents 21,849,532.74 9,893,016.08
Financial assets held for trading
Derivative Financial instrument
Notes receivable
Accounts receivable XV.1 4,371.17 201,780.44
Financing receivable
Prepayments 21,287.13
Other receivables XV.2 5,020,385.44 6,555,310.24
Inventories 862,258.78 2,264,166.58
including：Data Resources
Contractual asset
Held for sale assets
Current portion of non-current assets
Other current assets
Total Current Assets 27,736,548.13 18,935,560.47
Non-Current Assets：
Debt investment
Other debt investment
Long-term receivables
Long-term equity investment XV.3 923,414,701.56 923,414,701.56
Other equity instrument investment 40,000.00 40,000.00
Other non-current financial instrument
Investments properties 18,488,476.01 19,301,965.49
Fixed assets 729,555.26 294,240.38
Construction in process 80,198.02 97,676.45
Productive biological assets
Oil and gas assets
Right-of-use assets
Intangible assets
including：Data Resources
Development expenditures
including：Data Resources
Goodwill
Long-term prepaid expenses 736,503.51 1,016,860.33
Deferred tax assets 696,346.82 824,852.10
Other non-current assets
Total Non-current Assets 944,185,781.18 944,990,296.31
Total Assets 971,922,329.31 963,925,856.78
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Company’s Balance Sheet (continued)
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Item Notes 31/12/2025 31/12/2024
Current Liabilities:
Short- term borrowings
Financial liabilities held for trading
Derivative financial liabilities
Notes payable
Accounts payable 556,027.25 1,815,877.06
Received in advance 2,170,012.42 2,403,680.33
Contractual liability 73,127.34 153,646.35
Employee Benefits Payable 7,323,253.61 8,589,134.60
Taxes payable 5,312,866.63 5,127,289.98
Other payables 3,666,211.88 13,173,843.37
Liabilities classified as held for sale
Current portion of non-current liabilities
Other current liabilities
Total Current Liabilities 19,101,499.13 31,263,471.69
Non- current Liabilities:
Long-term borrowings
Bonds payable
including: Preference share
Perpetual debt
Lease liabilities
Long-term payables
Long- term employee payables
Provisions
Deferred income
Deferred Tax liabilities
Other non- current liabilities
Total Non -current Liabilities
Total Liabilities 19,101,499.13 31,263,471.69
Owners Equity( or Shareholders Equity) :
Share Capital 185,391,680.00 185,391,680.00
Other equity instrument
Including: preference share
perpetual capital securities
Capital reserves 271,490,289.82 271,490,289.82
Less: Treasury stock
Other comprehensive income
Special reserves
Surplus reserves 86,780,627.31 81,427,732.56
Retained earnings 409,158,233.05 394,352,682.71
Total Equity 952,820,830.18 932,662,385.09
Total Liabilities and Equity 971,922,329.31 963,925,856.78
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Consolidated Income Statement
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Item Notes 2025 2024
I. Total revenue 1,344,775,556.24 1,701,115,450.56
Including:Operating revenue V.35 1,344,775,556.24 1,701,115,450.56
Interest income
Net earned premiums
Net fee and commission revenue
II. Total cost of sales 1,347,440,334.84 1,621,904,892.41
Including: Cost of sales V.35 1,164,647,541.66 1,442,304,059.99
Interest expenses
Fees and commission expenses
Surrenders
Net payments for insurance claims
Net provision of insurance reserve
Policyholder dividends
Reinsurance expenses
Taxes and surcharges V.36 8,309,667.68 9,575,256.08
Selling and distribution expenses V.37 22,681,766.27 32,229,714.35
General and Administrative Expenses V.38 76,651,233.17 71,475,902.71
Research and Development Expenses V.39 61,494,511.72 64,932,266.81
Financial expenses V.40 13,655,614.34 1,387,692.47
Including: Interest expenses V.40 21,174,939.96 21,700,670.25
Interest income V.40 6,644,317.40 9,148,448.06
add: other income V.41 7,797,792.60 2,474,270.98
investment income (Loss listed with "-") V.42 29,022,384.02 37,678,574.75
Including: income from investments in associates and joint ventures -1,713,478.49
Gain arising from derecognition of financial asset measured at
amortized cost
Exchange gain (Loss listed with "-")
Net exposure hedging gains(Loss listed with "-")
Gain on the changes in fair value (Loss listed with "-") V.43 -942,083.33 -2,066,950.01
Credit impairment losses(Loss listed with "- ") V.44 -828,311.85 1,247,974.06
Assets impairment losses(Loss listed with "-") V.45 -3,642,607.37 -9,171,148.75
Gain on asset disposal(Loss listed with "-") V.46 756,104.15
III. Operating profit (Loss listed with "-") 28,742,395.47 110,129,383.33
Add: Non-operating income V.47 2,062,990.74 488,343.55
Less: Non-operating expenses V.48 121,321.05 86,992.81
IV. Total profit (Loss listed with "-") 30,684,065.16 110,530,734.07
Less: Income tax expenses V.49 2,335,334.43 14,439,043.79
V. Net profit (Net loss listed with "-") 28,348,730.73 96,091,690.28
(1)Net profit from continuing operation 28,348,730.73 96,091,690.28
(2)Net profit from discontinuing operation
(1)Net profit attributable to equity holders( shareholders) of the
Company
(2)Net profit attributable to non-controlling interests 4,803,411.36 23,309,047.80
VI. Other comprehensive income net off tax -3,954,027.00 1,367,590.68
Other comprehensive income, net of tax, attributable to owners of
-2,965,520.25 1,025,693.01
the parent
or loss
(1)Remeasurement gains or losses of a defined benefit plan
(2)Other comprehensive income using the equity method that will
not be reclassified to profit or loss
(3)Changes in fair value of other equity instrument investments
(4)Changes in fair value of enterprise's own credit risk
(1)Under equity method, proportionate share of other
comprehensive income invested company
(2)FV change of other debt investment
(3)Financial instrument reclassified into other comprehensive
income
(4)Credit impairment provision of other debt investment
(5)Cash flow hedges effective portion
(6)Foreign currency translation difference -2,965,520.25 1,025,693.01
(7)Others
Total comprehensive income attributable to non-controlling interests -988,506.75 341,897.67
VII. Total comprehensive income 24,394,703.73 97,459,280.96
Total comprehensive income attributable to parent Company 20,579,799.12 73,808,335.49
Total comprehensive income attributable to minority interest 3,814,904.61 23,650,945.47
VIII. Earnings per share
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Company’s Income Statement
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Item Notes 2025 2024
I. Including:Operating revenue XV.4 65,033,846.93 62,577,021.03
Less: Including: Cost of sales XV.4 40,233,757.88 38,198,806.71
Taxes and surcharges 3,622,720.97 3,493,800.18
Selling and distribution expenses 1,156,996.31 4,969,111.32
General and Administrative Expenses 3,249,234.00 3,756,259.59
Research and Development Expenses
Financial expenses -181,169.83 669,696.35
Including: Interest expenses
Interest income 96,993.71 238,136.71
add: other income 146,330.80 253,036.51
investment income (Loss listed with "-") XV.5 40,989,673.41 50,748,305.69
Including: income from investments in associates
and joint ventures
Gain arising from derecognition of financial asset
measured at amortized cost
Net exposure hedging gains(Loss listed with "-")
Gain on the changes in fair value (Loss listed with "-
")
Credit impairment losses(Loss listed with "- ") 10,865.60 -90,756.57
Assets impairment losses(Loss listed with "-") -493,604.13 -465,206.38
Gain on asset disposal(Loss listed with "-")
II. Operating profit (Loss listed with "-") 57,605,573.28 61,934,726.13
Add: Non-operating income 87,670.00 145,283.80
Less: Non-operating expenses
III. Total profit (Loss listed with "-") 57,693,243.28 62,080,009.93
Less: Income tax expenses 4,164,295.79 2,817,567.94
IV. Net profit (Net loss listed with "-") 53,528,947.49 59,262,441.99
(1)Net profit from continuing operation 53,528,947.49 59,262,441.99
(2)Net profit from discontinuing operation
V. Other comprehensive income net off tax
reclassified to profit or loss
(1)Remeasurement gains or losses of a defined
benefit plan
(2)Other comprehensive income using the equity
method that will not be reclassified to profit or loss
(3)Changes in fair value of other equity instrument
investments
(4)Changes in fair value of enterprise's own credit
risk
profit or loss
(1)Under equity method, proportionate share of
other comprehensive income invested company
(2)FV change of other debt investment
(3)Financial instrument reclassified into other
comprehensive income
(4)Credit impairment provision of other debt
investment
(5)Cash flow hedges effective portion
(6)Foreign currency translation difference
(7)Others
VI. Total comprehensive income 53,528,947.49 59,262,441.99
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Consolidated Statement of Cash Flows
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Item Notes 2025 2024
I.Cash flow from operating activities
Cash receipts from the sale of goods and the rendering of services 1,387,747,083.34 1,684,727,339.30
Net increase in customer bank deposits and due to banks and other
financial institutions
Net increase in loans from the central bank
Net increase in funds borrowed from other financial institutions
Cash premiums received on original insurance contracts
Net cash received from re-insurance business
Net increase in deposits and investments from insurers
Cash received from interest, fees and commission
Net increase in funds deposit
Net increase in repurchase business funds
Net income from securities trading brokerage business
Refunds of taxes 115,274,285.06 130,736,109.49
Cash received relating to other operating activities V.51 122,840,857.51 105,745,612.01
Sub-total of cash inflows from operating activities 1,625,862,225.91 1,921,209,060.80
Cash payments for goods and services acquired 1,173,380,815.04 1,282,912,066.78
Net increase in loans and payments on behalf of customers
Net increase in deposits with central bank and other financial institutions
Payments for claims for original insurance contracts
Net increase in funds lent
Cash paid for interest, fees and commission
Commissions on insurance policies paid
Cash payments to and on behalf of employees 315,057,361.50 333,654,754.29
Tax and duties payments 29,575,058.55 72,142,459.95
Cash paid relating to other operating activities V.51 122,836,112.72 96,116,367.69
Sub-total of cash outflows from operating activities 1,640,849,347.81 1,784,825,648.71
Net cash flows from operating activities -14,987,121.90 136,383,412.09
II.Cash flows from investing activities
Cash receipts from return of investments 51,074,481.69 467,496,463.16
Cash receipts from investments income 16,361,358.78 29,616,139.06
Net cash receipts from disposal of fixed assets, intangible assets and
other long-term assets
Net cash receipts from disposal of subsidiaries and other businesses
Cash received relating to other investing activities V.51 635,349,329.98 546,076,871.65
Sub-total of cash inflows from investing activities 718,824,234.93 1,046,626,353.63
Cash payments for acquired fixed assets, intangible assets and other long-
term assets
Cash payments for investment 214,439,000.00 481,500,000.00
Net increase of pledged loan
Net cash payments for acquisition of subsidiaries and other businesses
Other cash payments in investing activities V.51 325,728,783.59 699,587,632.10
Sub-total of cash outflows from investing activities 623,455,594.35 1,224,753,424.36
Net cash flows from investment activities 95,368,640.58 -178,127,070.73
III.Cash flows from financing activities
Cash received from capital injection
Including: Cash received by subsidiaries from investment absorpotion of
minority interest
Cash receipts from borrowings 35,841,800.00 21,282,600.00
Other cash receipts in financing activities V.51 4,748,170.39 11,360,910.42
Sub-total of cash inflows from financing activities 40,589,970.39 32,643,510.42
Cash paid for settlement of borrowings 35,730,000.00 21,309,000.00
Cash paid for dividends, profits appropriation or payments of interest 51,550,436.52 68,274,838.64
Including: Dividens and profits paid to minority interest 13,446,820.90 16,479,864.07
Other cash payments in financing activities V.51 15,555,306.89 21,446,503.68
Sub-total of cash outflows from financing activities 102,835,743.41 111,030,342.32
Net cash flows from financing activities -62,245,773.02 -78,386,831.90
IV.Effect of changes in foreign exchange rate on cash and cash
equivalents
V.Net increases in cash and cash equivalents 18,957,048.50 -119,919,544.03
Add: the beginning balance of cash and cash equivalent 441,890,727.50 561,810,271.53
VI.The ending balance of cash and cash equivalent 460,847,776.00 441,890,727.50
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Company’s Statement of Cash Flows
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Item Note 2025 2024
s
I.Cash flow from operating activities
Cash receipts from the sale of goods and the rendering of 1,914,120.68 3,439,524.96
services
Refunds of taxes
Cash received relating to other operating activities 69,655,986.18 64,957,580.15
Sub-total of cash inflows from operating activities 71,570,106.86 68,397,105.11
Cash payments for goods and services acquired 1,973,804.82 1,759,781.26
Cash payments to and on behalf of employees 3,286,950.69 2,951,729.61
Tax and duties payments 10,946,438.15 8,283,951.05
Cash paid relating to other operating activities 50,143,940.24 57,599,761.90
Sub-total of cash outflows from operating activities 66,351,133.90 70,595,223.82
Net cash flows from operating activities 5,218,972.96 -2,198,118.71
II.Cash flows from investing activities
Cash receipts from return of investments
Cash receipts from investments income 40,989,673.41 50,748,305.69
Net cash receipts from disposal of fixed assets, intangible
assets and other long-term assets
Net cash receipts from disposal of subsidiaries and other
businesses
Cash received relating to other investing activities
Sub-total of cash inflows from investing activities 40,989,673.41 50,748,305.69
Cash payments for acquired fixed assets, intangible assets 1,004,782.17 297,569.26
and other long-term assets
Cash payments for investment
Net cash payments for acquisition of subsidiaries and other
businesses
Other cash payments in investing activities
Sub-total of cash outflows from investing activities 1,004,782.17 297,569.26
Net cash flows from investment activities 39,984,891.24 50,450,736.43
III.Cash flows from financing activities
Cash received from capital injection
Cash receipts from borrowings
Other cash receipts in financing activities
Sub-total of cash inflows from financing activities
Cash paid for settlement of borrowings
Cash paid for dividends, profits appropriation or payments
of interest 33,370,502.40 46,347,920.00
Other cash payments in financing activities
Sub-total of cash outflows from financing activities 33,370,502.40 46,347,920.00
Net cash flows from financing activities -33,370,502.40 -46,347,920.00
IV.Effect of changes in foreign exchange rate on cash and
cash equivalents 123,154.86 -1,238.75
V.Net increases in cash and cash equivalents 11,956,516.66 1,903,458.97
Add: the beginning balance of cash and cash equivalent 9,893,016.08 7,989,557.11
VI.The ending balance of cash and cash equivalent 21,849,532.74 9,893,016.08
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Consolidated Statement of Changes in Shareholder’s Equity
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Other equity instruments Preference shares Perpetual capital securities Others
Other equity instruments Total
Item Less: Other Non-controlling
Perpetual Special Surplus General Retained shareholders’
Share capital Preference Capital reserves Treasury comprehensive Subtotal interests
capital Others reserves reserves reserve earnings equity
shares stock income
securities
I.Balance at the end of previous year 185,391,680.00 296,808,965.79 11,252,746.52 81,427,732.56 527,518,517.81 1,102,399,642.68 466,615,694.36 1,569,015,337.04
Add: Changes in accounting policies
Correction of prior period errors
Business combination under common
control
Others
II.Balance at the beginning of the year 185,391,680.00 296,808,965.79 11,252,746.52 81,427,732.56 527,518,517.81 1,102,399,642.68 466,615,694.36 1,569,015,337.04
III.Increase/ Decrease for current year
-2,965,520.25 5,352,894.75 -15,178,077.78 -12,790,703.28 -9,631,916.29 -22,422,619.57
(Decrease listed with "-")
(1)Ordinary shares contributed by
shareholders
(2)Capital contributed by holders of
other equity instruments
(3)Share-based payments recognised in
owners’ equity
(4)Others
(1)Transfer to surplus reserve 5,352,894.75 -5,352,894.75
(2)Transfer to general Reserve
(3)Distribution to shareholders -33,370,502.40 -33,370,502.40 -13,446,820.90 -46,817,323.30
(4)Others
(1)Capital reserves converted to share
capital
(2)Surplus reserves converted to share
capital
(3)Loss made up by surplus reserves
(4)Changes in the defined benefit plan
transferred to retained earnings
(5)Other comprehensive income
transferred to retained earnings
(6)Others
(1)Additions
(2)Utilisation
IV.Balance at end of current year 185,391,680.00 296,808,965.79 8,287,226.27 86,780,627.31 512,340,440.03 1,089,608,939.40 456,983,778.07 1,546,592,717.47
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Consolidated Statement of Changes in Shareholder’s Equity (continued)
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Other equity instruments Preference shares Perpetual capital securities Others
Other equity instruments Total
Item Less: Other Non-controlling
Perpetual Special Surplus General Retained shareholders’
Share capital Preference Capital reserves Treasury comprehensive Subtotal interests
capital Others reserves reserves reserve earnings equity
shares stock income
securities
I.Balance at the end of previous year 185,391,680.00 296,808,965.79 10,227,053.51 75,501,488.36 507,010,039.53 1,074,939,227.19 459,444,612.96 1,534,383,840.15
Add: Changes in accounting policies
Correction of prior period errors
Business combination under common
control
Others
II.Balance at the beginning of the year 185,391,680.00 296,808,965.79 10,227,053.51 75,501,488.36 507,010,039.53 1,074,939,227.19 459,444,612.96 1,534,383,840.15
III.Increase/ Decrease for current year
(Decrease listed with "-")
(1)Ordinary shares contributed by
shareholders
(2)Capital contributed by holders of
other equity instruments
(3)Share-based payments recognised in
owners’ equity
(4)Others
(1)Transfer to surplus reserve 5,926,244.20 -5,926,244.20
(2)Transfer to general Reserve
(3)Distribution to shareholders -46,347,920.00 -46,347,920.00 -16,479,864.07 -62,827,784.07
(4)Others
(1)Capital reserves converted to share
capital
(2)Surplus reserves converted to share
capital
(3)Loss made up by surplus reserves
(4)Changes in the defined benefit plan
transferred to retained earnings
(5)Other comprehensive income
transferred to retained earnings
(6)Others
(1)Additions
(2)Utilisation
IV.Balance at end of current year 185,391,680.00 296,808,965.79 11,252,746.52 81,427,732.56 527,518,517.81 1,102,399,642.68 466,615,694.36 1,569,015,337.04
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Company’s Statement of Changes in Shareholder’s Equity
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Other equity instruments
Perpetua Less: Other
Item Preferen Special Surplus
Share capital l capital Capital reserves Treasur comprehensive Retained earnings Subtotal
ce Others reserves reserves
securitie y stock income
shares
s
I.Balance at the end of previous year 185,391,680.00 271,490,289.82 81,427,732.56 394,352,682.71 932,662,385.09
Add: Changes in accounting policies
Correction of prior period errors
Others
II.Balance at the beginning of the year 185,391,680.00 271,490,289.82 81,427,732.56 394,352,682.71 932,662,385.09
III.Increase/ Decrease for current year (Decrease
listed with "-")
(1)Ordinary shares contributed by
shareholders
(2)Capital contributed by holders of
other equity instruments
(3)Share-based payments recognised in
owners’ equity
(4)Others
(1)Transfer to surplus reserve 5,352,894.75 -5,352,894.75
(2)Distribution to shareholders -33,370,502.40 -33,370,502.40
(3)Others
(1)Capital reserves converted to share capital
(2)Surplus reserves converted to share capital
(3)Loss made up by surplus reserves
(4)Changes in the defined benefit plan
transferred to retained earnings
(5)Other comprehensive income transferred to
retained earnings
(6)Others
(1)Additions
(2)Utilisation
IV.Balance at end of current year 185,391,680.00 271,490,289.82 86,780,627.31 409,158,233.05 952,820,830.18
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Company’s Statement of Changes in Shareholder’s Equity (continued)
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
Other equity instruments
Perpetu
Less: Other
Item al Retained
Share capital Preferenc Capital reserves Treasury comprehensive Special reserves Surplus reserves Subtotal
capital Others earnings
e shares stock income
securitie
s
I.Balance at the end of previous year 185,391,680.00 271,490,289.82 75,501,488.36 387,364,404.92 919,747,863.10
Add: Changes in accounting policies
Correction of prior period errors
Others
II.Balance at the beginning of the year 185,391,680.00 271,490,289.82 75,501,488.36 387,364,404.92 919,747,863.10
III.Increase/ Decrease for current year (Decrease
listed with "-")
(1)Ordinary shares contributed by
shareholders
(2)Capital contributed by holders of
other equity instruments
(3)Share-based payments recognised in
owners’ equity
(4)Others
(1)Transfer to surplus reserve 5,926,244.20 -5,926,244.20
(2)Distribution to shareholders -46,347,920.00 -46,347,920.00
(3)Others
(1)Capital reserves converted to share capital
(2)Surplus reserves converted to share capital
(3)Loss made up by surplus reserves
(4)Changes in the defined benefit plan
transferred to retained earnings
(5)Other comprehensive income transferred to
retained earnings
(6)Others
(1)Additions
(2)Utilisation
IV.Balance at end of current year 185,391,680.00 271,490,289.82 81,427,732.56 394,352,682.71 932,662,385.09
Legal Representative: Cai Yuansong Chief Financial Officer: Wu Jianhua Finance Manager: Wu Jianhua
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended 31 December 2025
（All amounts in RMB Yuan unless otherwise stated）
(English Translation for Reference Only)
I.The basic information of company
TsannKuen (China) Enterprise Co., Ltd. (hereafter “ the Company or TKC ” ) was
established in the People’s Republic of China (“the PRC”) in 1988 as a wholly owned
foreign investment enterprise, the Company named in TsannKuen China (Xiamen) Ltd.,
firstly, invested by the Fordchee Development Limited, EUPA Industry Corporation
Limited and Fillman Investments Limited. On 16 February 1993, with the approval of the
Ministry of Foreign Trade and Economic Co-operation, the Company was reorganized
into an incorporated company and was renamed as TsannKuen (China) Enterprise Co.,
Ltd. In June 1993, the Company issued 40,000,000 new shares pursuant to an
international placing and public offer and these new shares ( “ B shares ” ) were then
listed on the Shenzhen Stock Exchange on 30 June 1993. According to the “ Intended
Implementation of Share Reducing Proposal” of the 5th extraordinary board of director
of 2012 and the 3rd extraordinary shareholders’ general meeting of 2012, obtained the
consent from the Investment Promotion Bureau of Xiamen which is authorized by the
Ministry of Commerce and the approval documents ” The Approval by Investment
Promotion Bureau of Xiamen to Consent the Capital Reduction of TsannKuen (China)
Enterprise Co., Ltd”(IPB audit [2012] NO. 698), as the base 1,112,350,077 shares of the
total original share capital, for implementation of share reducing model that all registered
shareholders who was recorded on 28 December 2012 with the proportion 6:1 to reduce
the shares. After the implementation of share reducing model, total share capital was
reduced from 1,112,350,077 shares to 185,391,680 shares of the company. Until 31
December 2025, the Company’s share capital is CNY 185,391,680.
Following The Ministry of Commerce of the People’s Republic of China approved (The
No. [2005]3107 “ Agreed in Principle to the Ministry of Commerce on TsannKuen
(China) Enterprise Co., Ltd. Shares Traded Sponsor of the Approval”), On 6 December
Enterprise Co., Ltd, concerning the Approval of non-listed Foreign Shares Traded” from
China Securities Regulatory Commission. The China Securities Regulatory Commission
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
agreed 700,476,830 unlisted shares (account for 62.97% of the share capital) held by the
Company’s shareholders, EUPA Industry Corporation Limited, Fordchee Development
Limited, and Fillman Investments Limited to transfer into B shares. On 29 November
December 2025, total B shares held by the three legal shareholders (EUPA Industry
Corporation Limited, Fordchee Development Limited, and Fillman Investments Limited)
are 82,830,966 shares after the implementation of share reducing model (Accounts for
Legal representative: CAI, Yuansong
Place of registration: No.88 Xinglong Road, Huli Industrial District, Xiamen, Fujian
Province
The parent company: STAR COMGISTIC CAPITAL CO., LTD.
The Company operates within the electrical machinery and equipment manufacturing
industry.
The industry of the company: electrical machinery and equipment manufacturing.
The company is actually engaged in the main business activities are: Develop, produce
and manufacture small home appliances of gourmet cooking, home helper, tea and coffee;
design and manufacture molds related to the above products, sell the products at home
and abroad, and provide after-sales service.
The financial statements approved by the resolution of the Board of Directors on 07
March 2026, in accordance with the Articles of Association, the financial statements will
be submitted to the shareholders meeting for consideration.
II.The basis for the preparation of financial statements
The financial statements have been prepared in accordance with the "Accounting
Standards for Business Enterprises - Basic Standards" and various specific accounting
standards, guidelines for the application of accounting standards for business
enterprises,interpretations of accounting standards for business enterprises and other
related regulations (hereinafter collectively referred to as "Accounting Standards for
Business Enterprises") issued by the Ministry of Finance, as well as the relevant
provisions of the "General Provisions on Financial Reporting, No. 15 of the Rules
Governing the Preparation of Information Disclosures by Companies Issuing Public
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Securities" of the China Securities Regulatory Commission.
These financial statements are prepared on a going concern basis.
The Company has assessed its ability to continually operate for the next twelve months
from the end of the reporting period, and no matters that may result in doubt on its ability
as a going concern were noted. Therefore, it is reasonable for the Company to prepare
financial statements on the going concern basis.
III.Significant Accounting Policies and Accounting Estimates
The Company prepares its financial statements in accordance with the requirements of the
Accounting Standards for Business Enterprises, truly and completely reflecting the
consolidate and company ’ s financial position as at 31 December 2025, and the
consolidated and company’s operating results, changes in shareholders' equity, cash flows
and other related information for the year then ended.
The accounting year of the Company is from 1 January to 31 December in calendar year.
The normal operating cycle of the Company is one year.
The Company takes Renminbi Yuan (“CNY”) as the functional currency.
The Company ’ s overseas subsidiaries choose the currency of the primary economic
environment in which the subsidiaries operate as the functional currency.
Business combinations under common control: Assets and liabilities acquired by the
consolidating party in a business combination (including goodwill resulting from the
acquisition of the consolidated party by the ultimate controlling party) are measured at the
carrying value of the consolidated party's assets and liabilities in the consolidated
financial statements of the ultimate controlling party at the date of the combination. The
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
difference between the book value of the net assets acquired in the merger and the book
value of the merger consideration paid (or the total nominal value of shares issued) is
adjusted against the equity premium in capital surplus, and if the equity premium in
capital surplus is not sufficient for elimination, retained earnings are adjusted.
Business combinations not under common control: The cost of the combination is the fair
value of the assets paid, liabilities incurred or assumed and equity securities issued by the
purchaser to obtain control of the acquiree at the date of acquisition. The difference
between the cost of the combination and the share of the fair value of the acquiree's
identifiable net assets acquired in the combination is recognized as goodwill; the
difference between the cost of the combination and the share of the fair value of the
acquiree's identifiable net assets acquired in the combination is recognized in profit or
loss for the period. Each identifiable asset, liability and contingent liability of the acquiree
acquired in a merger that meets the recognition criteria is measured at fair value at the
date of acquisition.
Directly related costs incurred for a business combination are recognized in profit or loss
as incurred; transaction costs for issuing equity securities or debt securities for a business
combination are included in the initial recognition amount of the equity securities or debt
securities.
statements
(1)Criteria for determining control
The scope of consolidation in the consolidated financial statements is determined
on the basis of control, and the scope of consolidation includes the Company and
all of its subsidiaries. Control means that the Company has power over the investee,
enjoys variable returns through its participation in the investee's related activities,
and has the ability to use its power over the investee to influence the amount of its
returns.
(2)Consolidation procedures
The Company considers the entire enterprise group as one accounting entity and
prepares consolidated financial statements in accordance with uniform accounting
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
policies to reflect the financial position, results of operations and cash flows of the
enterprise group as a whole. The effects of internal transactions that occur between
the Company and its subsidiaries and between subsidiaries are eliminated. If an
internal transaction indicates an impairment loss on the related asset, the full
amount of such loss is recognized. If the accounting policies and accounting
periods adopted by a subsidiary are not consistent with those of the Company, the
necessary adjustments are made in accordance with the Company's accounting
policies and accounting periods when preparing the consolidated financial
statements.The share of ownership equity, net profit or loss for the period and
comprehensive income for the period attributable to minority shareholders of the
subsidiaries arepresented separately in the consolidated balance sheet under the
item of ownership equity, in the consolidated income statement under the item of
net profit and in the consolidated statement of total comprehensive income,
respectively. The balance resulting from the subsidiary's minority share of current
loss exceeding the minority's share of the subsidiary's opening ownership interest is
eliminated to reduce shareholders'equity.
①Increase number of subsidiaries or operations
During the reporting period, if a subsidiary or business is added as a result of a
business combination under the same control, the operating results and cash flows
of the subsidiary or business from the beginning of the period in which the
subsidiary or business is combined to the end of the reporting period are included
in the consolidated financial statements,while the opening balance of the
consolidated financial statements and the relevant items in the comparative
statements are adjusted as if the consolidated reporting entity had existed since the
point when the ultimate controlling party began to control it.
If control over an investee under the same control can be exercised due to
additional investment, equity investments held prior to the acquisition of control
over the investee are eliminated from the opening retained earnings or current
profit or loss for the comparative statement period, respectively, for the relevant
gains or losses, other comprehensive income and other changes in net assets
recognized between the later of the date of acquisition of the original equity
interest and the date when the consolidated party and the investee are under the
same control and the date of consolidation.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
During the reporting period, the addition of subsidiaries or operations as a result of
a business combination not under common control is included in the consolidated
financial statements from the date of acquisition based on the fair value of each
identifiable asset, liability and contingent liability determined at the date of
acquisition.
If, for example, additional investments enable the exercise of control over an
investee not under common control, the equity interest in the investee held prior to
the date of acquisition is remeasured at the fair value of that equity interest at the
date of acquisition, and the difference between the fair value and its carrying
amount is recognized as investment income for the current period. The difference
between the fair value and its
carrying amount is recognized as investment income for the period. The equity
interest in the investee held prior to the date of acquisition is transferred to
investment income for the period to which the equity interest is transferred under
the equity method.
②Disposal of subsidiaries
When control over an investee is lost due to disposal of part of the equity
investment or other reasons, the remaining equity investment after disposal is
remeasured at its fair value at the date of loss of control. The difference between
the sum of the consideration received for the disposal of the equity interest and the
fair value of the remaining equity interest,less the sum of the share of the net assets
of the original subsidiary calculated on a continuing basis from the date of
acquisition or the date of consolidation in proportion to the original shareholding
and goodwill, is recognized as investment income in the period in which control is
lost. Other comprehensive income and other changes in owners' equity under the
equity method of accounting related to the equity investment in the original
subsidiary that can be reclassified to profit or loss in the future are transferred to
investment income in the current period when control is lost.
Disposal of equity investments in subsidiaries through multiple transactions in
steps until the loss of control, the terms and conditions of the disposal of equity
investments in subsidiaries and the economic impact of each transaction is
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
consistent with one or more of the following, usually indicating that the multiple
transactions are a package deal:
i. The transactions are entered into simultaneously or after taking into account their
mutual effects;
Ⅱ. These transactions as a whole to achieve a complete business result;
ⅲ . The occurrence of one transaction depends on the occurrence of at least one
other transaction;
ⅳ . A transaction is not economical when viewed alone, but is economical when
considered together with other transactions.
If each transaction is a package transaction, each transaction is accounted for as a
disposal of a subsidiary and loss of control; the difference between the disposal
price and the share of the net assets of the subsidiary corresponding to the disposal
of the investment before the loss of control is recognized in the consolidated
financial statements as other comprehensive income and is transferred to profit or
loss in the period is lost when control is lost.
If each transaction is not a package transaction, the accounting treatment is based
on partial disposal of the equity investment in the subsidiary without loss of control
before the loss of control; upon the loss of control, the accounting treatment is
based on the general treatment of disposal of subsidiaries.
③Purchase of minority interests in subsidiaries
The difference between the newly acquired long-term equity investment due to the
purchase of minority interest and the share of net assets of the subsidiary calculated
in proportion to the newly acquired shareholding on an ongoing basis from the date
of acquisition or the date of consolidation is adjusted to the equity premium in
capital surplus in the consolidated balance sheet; if the equity premium in capital
surplus is not sufficient for elimination, it is adjusted to retained earnings.
(4) Partial disposal of equity investments in subsidiaries without loss of control
The difference between the disposal price and the share of net assets of the
subsidiary calculated on acontinuing basis from the date of acquisition or the date
of consolidation corresponding to the disposal of the long-term equity investment
is adjusted to the equity premium in capital surplus in the consolidated balance
sheet, and if the equity premium in capital surplus is not sufficient to offset it,
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
retained earnings are adjusted.
The cash listed on the cash flow statements of the Group refers to cash on hand and bank
deposit. The cash equivalents refer to short-term (normally with original maturities of
three months or less) and liquid investments which are readily convertible to known
amounts of cash and subject to an insignificant risk of changes in value.
(1)Foreign currency transaction
At the initial recognition of foreign currency transactions, the entity uses the spot
exchange rate on the date of the transaction or an approximate spot exchange rate
determined using a systematic and rational method that is close to the spot rate at
the date of the transaction (hereinafter referred to as the approximate spot rate) for
conversion into the functional currency.
On the balance sheet date, for foreign currency monetary items, the spot exchange
rate on the balance sheet date is used for conversion. The exchange differences
arising from the difference between the spot exchange rate on the balance sheet
date and the spot rate at the date of initial recognition or the previous balance sheet
date are recognized in profit or loss. For non-monetary foreign currency items
measured at historical cost, the spot exchange rate at the date of the transaction
continues to be used; for non-monetary foreign currency items measured at fair
value, the spot exchange rate on the date when the fair value is determined is used,
and the difference between the amount in the functional currency after conversion
and the original amount in the functional currency is recognized in profit or loss.
(2)Translation of foreign currency financial statements
Before translating the financial statements of a foreign operation, adjust the
accounting periods and accounting policies of the foreign operation to align with
those of the reporting entity. Then, prepare the financial statements in the relevant
currency (other than the functional currency) based on the adjusted accounting
policies and periods. The translation of the financial statements of the foreign
operation should be performed as follows:
①Assets and Liabilities in the Statement of Financial Position:
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Assets and liabilities are translated at the spot exchange rate on the balance sheet
date.
For equity items, except for "retained earnings," other equity items are translated at
the spot exchange rates prevailing at the dates of the transactions.
②Income and Expense Items in the Statement of Profit or Loss:
Income and expense items are translated at the spot exchange rates on the dates of
the transactions or using an approximate exchange rate that is a reasonable
approximation of the spot rate on the transaction date.
③Foreign Currency Cash Flows and Cash Flows of Foreign Subsidiaries:
Foreign currency cash flows and cash flows of foreign subsidiaries are translated at
the spot exchange rates on the dates of the cash flows or using an approximate
exchange rate that is a reasonable approximation of the spot rate on the date of the
cash flow.
The effect of exchange rate changes on cash and cash equivalents should be
reported as a separate reconciling item in the statement of cash flows.
④ Translation Differences Arising from the Translation of Foreign Financial
Statements:
In the preparation of consolidated financial statements, the resulting translation
differences are presented separately in the consolidated statement of financial
position under equity as "other comprehensive income."
When a foreign operation is disposed of and control is lost, the cumulative
translation differences related to that foreign operation, which are presented in the
equity section of the balance sheet, should be transferred to profit or loss in full or
proportionally, depending on the extent of the disposal.
The Company recognizes a financial asset, a financial liability or an equity instrument
when it becomes a party to a financial instrument contract.
(3)Classification of financial instruments
Based on the Company's business model for managing financial assets and the
contractual cash flow characteristics of financial assets, financial assets are
classified at initial recognition as financial assets carried at amortized cost,
financial assets at fair value through other comprehensive income, and financial
assets at fair value through profit or loss.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
The Company classifies financial assets at amortized cost that are not designated as
financial assets at fair value through profit or loss if they both meet the following
criteria:
- The business model is to collect the contractual cash flows;
- The contractual cash flows are only payments of principal and interest based on
the outstanding principal amount.
The Company classifies financial assets as financial assets at fair value through
other comprehensive income (debt instruments) that are not designated as at fair
value through profit or loss if they also meet the following criteria:
- Operating model with the objective of both collecting the contractual cash flows
and selling the financial asset;
- The contractual cash flows are only payments on the principal and interest based
on the outstanding principal amount.
For investments in non-trading equity instruments, the Company may irrevocably
designate them at initial recognition as financial assets at fair value through other
comprehensive income (equity instruments). This designation is made on an
individual investment basis and the related investment meets the definition of an
equity instrument from the perspective of the issuer.
Except for the above-mentioned financial assets measured at amortized cost and
financial assets at fair value through other comprehensive income, the Company
classifies all remaining financial assets as financial assets at fair value through
profit or loss. On initial recognition, the Company may irrevocably designate
financial assets that would otherwise be classified as financial assets at amortized
cost or at fair value through other comprehensive income as financial assets at fair
value through profit or loss if it can eliminate or significantly reduce the
accounting mismatch.
Financial liabilities are classified at initial recognition as financial liabilities at fair
value through profit or loss and financial liabilities at amortized cost.
A financial liability maybe designated as a financial liability at fair value through
profit or loss at initial measurement if one of the following conditions is met:
①The designation eliminates or significantly reduces an accounting mismatch.
② The management and performance evaluation of a portfolio of financial
liabilities or a portfolio of financial assets and financial liabilities is performed on a
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
fair value basis in accordance with the enterprise's risk management or investment
strategy as set out in formal written documentation and reported to key
management personnel on this basis within the enterprise.
③The financial liability contains embedded derivatives that are subject to separate
splitting.
(4)Recognition basis and measurement method of financial instruments
①Financial assets measured at amortized cost
Financial assets measured at amortized cost, including notes receivable, accounts
receivable, other receivables, long-term receivables and debt investments, are
initially measured at fair value, with related transaction costs included in the initial
recognition amount; accounts receivable that do not contain significant financing
components and those that the Company has decided not to consider financing
components that do not exceed one year are initially measured at contractual
transaction prices.
Interest calculated using the effective interest rate method during the holding
period is recognized in profit or loss.
On recovery or disposal, the difference between the acquisition price and the
carrying amount of the financial asset is recognized in profit or loss for the current
period.
② Financial assets at fair value through other comprehensive income (debt
instruments)
Financial assets (debt instruments) at fair value through other comprehensive
income include receivables financing and other debt investments, which are
initially measured at fair value, with related transaction costs recognized in the
initial recognition amount. The financial assets are subsequently measured at fair
value, and changes in fair value are recognized in other comprehensive income,
except for interest, impairment loss or gain and exchange gain or loss calculated
using the effective interest rate method.
Upon derecognition, the cumulative gain or loss previously recognized in other
comprehensive income is transferred from other comprehensive income and
recognized in profit or loss for the current period.
③ Financial assets at fair value through other comprehensive income (equity
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
instruments)
Financial assets (equity instruments) at fair value through other comprehensive
income,including investments in other equity instruments, are initially measured at
fair value, with related transaction costs recognized in the initial recognition
amount. The financial assets are subsequently measured at fair value, with changes
in fair value recognized in other comprehensive income. Dividends received are
recognized in current profit or loss.
Upon derecognition, the cumulative gain or loss previously recognized in other
comprehensive income is transferred from other comprehensive income and
recognized in retained earnings.
④Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include financial assets held for
trading, derivative financial assets and other non-current financial assets, which are
initially measured at fair value, with related transaction costs recognized in profit
or loss. The financial assets are subsequently measured at fair value, with changes
in fair value recognized in profit or loss for the period.
⑤Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities
held for trading and derivative financial liabilities, which are initially measured at
fair value, with related transaction costs recognized in profit or loss. The financial
liabilities are subsequently measured at fair value, with changes in fair value
recognized in profit or loss for the period.
Upon derecognition, the difference between the carrying amount and the
consideration paid is recognized in profit or loss for the current period.
⑥Financial liabilities measured at amortized cost
Financial liabilities measured at amortized cost include short-term borrowings,
notes payable, accounts payable, other payables, long-term borrowings, bonds
payable and long- term payables, which are initially measured at fair value, with
related transaction costs included in the initial recognition amount.
Interest calculated using the effective interest rate method during the holding
period is recognized in profit or loss.
Upon derecognition, the difference between the consideration paid and the carrying
amount of the financial liability is recognized in profit or loss for the current period.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(5) Basis of recognition and measurement of financial asset derecognition and
financial asset transfers
The Company derecognizes a financial asset when one of the following conditions
is met:
- The contractual rights to receive cash flows from the financial asset are
terminated;
- The financial asset has been transferred and substantially all the risks and rewards
of ownership of the financial asset have been transferred to the transferring party;
- A financial asset has been transferred and control over the financial asset is not
retained, although the Company neither transfers nor retains substantially all the
risks and rewards of ownership of the financial asset.
When the Company modifies or renegotiates a contract with a counterparty and the
modification constitutes a material change, the original financial asset is
derecognized and a new financial asset is recognized in accordance with the
modified terms.
A financial asset is not derecognized if substantially all the risks and rewards of
ownership of the financial asset are retained when a transfer of the financial asset
occurs.
In determining whether a transfer of financial assets meets the above conditions for
derecognition of financial assets, the principle of substance over formis applied.
The Company distinguishes between transfers of financial assets as a whole and
partial transfers of financial assets. If the transfer of a financial asset as a whole
meets the derecognition condition, the difference between the following two
amounts is recognized in profit or loss for the current period:
①The carrying amount of the financial asset transferred;
② The sum of the consideration received for the transfer and the cumulative
amount of changes in fair value previously recognized directly in owners'equity (in
the case where the transferred financial asset is a financial asset (debt instrument)
measured at fair value through other comprehensive income).
If a partial transfer of a financial asset satisfies the derecognition condition, the
carrying amount of the financial asset transferred as a whole is apportioned
between the
derecognized portion and the unrecognized portion according to theirrespective
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
relative
fair values, and the difference between the following two amounts is recognized in
profit or loss:
①The carrying amount of the derecognized portion;
②The sum of the consideration for the derecognized portion and the amount
corresponding to the derecognized portion of the cumulative amount of changes in
fair value previously recognized directly in owners'equity (in the case where the
financial asset involved in the transfer is a financial asset (debt instrument)
measured at fair value through other comprehensive income).
If the transfer of a financial asset does not meet the derecognition condition, the
financial asset continues to be recognized and the consideration received is
recognized as a financial liability.
(6)Derecognition of financial liabilities
A financial liability or a portion thereof is derecognized when the present
obligation of the financial liability is discharged in whole or in part. If the
Company enters into an agreement with a creditor to replace an existing financial
liability by assuming a new financial liability, and the contractual terms of the new
financial liability are materially different from those of the existing financial
liability, the existing financial liability is derecognized and a new financial liability
is recognized at the sametime.
If all or part of the contractual terms of an existing financial liability are
substantially modified, the existing financial liability or part of it is derecognized,
and the modified financial liability is recognized as a new financial liability at the
sametime.
When a financial liability is derecognized in whole or in part, the difference
between the carrying amount of the derecognized financial liability and the
consideration paid (including non-cash assets transferred or new financial liabilities
assumed) is recognized in profit or loss for the period.
If the Company repurchases a portion of a financial liability, the carrying amount
of the financial liability as a whole is allocated on the repurchase date based on the
relative fair values of the portion that continues to be recognized and the portion
that is derecognized. The difference between the carrying amount allocated to the
derecognized portion and the consideration paid (including non-cash assets
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
transferred or new financial liabilities assumed) is recognized in profit or loss for
the period.
(7)Methods to determine the fair value of financial assets and financial liabilities
The fair value of financial instruments for which there is an active market is
determined by quoted prices in an active market. The fair value of financial
instruments for which no active market exists is determined using valuation
techniques. In valuation, the Company uses valuation techniques that are applicable
in the current circumstances and supported by sufficient available data and other
information, selects inputs that are consistent with the characteristics of the asset or
liability considered by market participants in transactions for the relevant asset or
liability, and gives preference to the use of relevant observable inputs.
Unobservable inputs are used only if the relevant observable inputs are not
available or not practicable to obtain.
(8)Methods of testing and accounting for impairment of financial instrument
The Company estimates the expected credit losses on financial assets measured at
amortized cost, financial assets at fair value through other comprehensive income
(debt instruments) and financial guarantee contracts, etc.
The Company recognizes expected credit losses by calculating the probability-
weighted amount of the present value of the difference between the cash flows
receivable under the contract and the cash flows expected to be received, taking
into account reasonable and substantiated information about past events, current
conditions and forecasts of future economic conditions, weighted by the risk of
default.
For receivables and contract assets resulting from transactions governed by ASBE
No. 14, Revenue, the Company always measures its allowance for losses at an
amount equal to the expected credit losses over the entire duration, regardless of
whether or not there is a significant financing component.
For lease receivables resulting from transactions regulated by ASBE No. 21,
"Leases," the Company has elected to always measure its allowance for losses at an
amount equal to the expected credit losses over the entire duration.
For other financial instruments, the Company assesses at each balance sheet date
the change in credit risk of the related financial instruments since initial recognition.
The Company assesses whether the credit risk of a financial instrument has
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
increased significantly since initial recognition by comparing the risk of default of
the financial instrument at the balance sheet date with the risk of default at the date
of initial recognition to determine the relative change in the risk of default over the
expected life of the financial instrument. The Company generally considers that the
credit risk of a financial instrument has increased significantly if it is more than
financial instrument has not increased significantly since initial recognition.
If the credit risk of a financial instrument is low at the balance sheet date, the
Company considers that the credit risk of the financial instrument has not increased
significantly since initial recognition.
If the credit risk of a financial instrument has increased significantly since initial
recognition, the Company measures the allowance for losses at an amount equal to
the expected credit losses over the entire life of the financial instrument; if the
credit risk of a financial instrument has not increased significantly since initial
recognition, the Company measures the allowance for losses at an amount equal to
the expected credit losses of the financial instrument in the next 12 months. The
resulting increase or reversal amount of the loss allowance is recognized as an
impairment loss or gain in profit or loss. For financial assets (debt instruments) that
are measured at fair value through other comprehensive income, the allowance for
losses is recognized in other comprehensive income and the impairment loss or
gain is recognized in profit or loss for the current period and does not reduce the
carrying amount of the financial asset as stated in the balance sheet.
The Company classifies the remaining financial instruments into several groups
based on their credit risk characteristics and determines the expected credit losses
on a collective basis. The categories of groups for which the Company recognizes
expected credit losses, including notes receivable, accounts receivable, financing
receivables, other receivables, contract assets, and long-term receivables, and the
basis for determining these groups are as follows:
①Receivables
For the notes receivable, accounts receivable, other receivables, accounts
receivable financing, and long-term receivables which are demonstrated to be
impaired by any objective evidence, or applicable for individual assessment, the
Company shall individually assess for impairment and recognize the loss allowance
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
for expected credit losses. If the Company determines that no objective evidence of
impairment exists for notes receivable, accounts receivable, other receivables,
accounts receivable financing, and long-term receivables, or the expected credit
loss of a single financial asset cannot be assessed at reasonable cost, such notes
receivable, accounts receivable, other receivables, accounts receivable financing,
and long-term receivables shall be divided into several groups based on similar
credit risk characteristics and calculate collectively on the expected credit loss. The
determination basis of groups is as following:
For notes receivable classified as portfolios, the Company calculates expected
credit losses based on default exposure and expected credit loss rates throughout
the life of the Company, considering historical credit loss experience, combined
with current conditions and the forecast of the future economic conditions.
Item Basis for determining the groups
Bank acceptance bill The acceptor is a bank with less credit risk.
According to the credit risk of the acceptor, it
Commercial
should be the same as the portfolios of
acceptance bill
accounts receivable.
For receivables that do not contain significant financing components, our company
measures the loss provision based on the expected credit loss amount over the
entire duration of the receivable.
For receivables that contain significant financing components and lease receivables,
our company always measures the loss provision based on the expected credit loss
amount over the duration of the receivable.
Except for accounts receivable that are assessed individually for credit risk, they
are categorized into different groups based on their credit risk characteristics.：
Item Basis for determining the groups
Aging of Accounts This group uses the accounts receivables
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Item Basis for determining the groups
Receivables aging as the credit risk characteristics.
Related party relationships (Unless there is
Related parties
evidence that a credit loss may occur).
The Company assesses whether the credit risk of other receivables has significantly
increased since initial recognition, and utilizes the amount equivalent to the
expected credit loss in the next 12 months or the whole duration to measures the
impairment loss accordingly. Besides the other receivables that have individually
assessed credit risk, the rest of the other receivables are classified into different
groups based on their credit risk characteristics:
Item Basis for determining the groups
This group of receivables includes deposit receivables,
Deposit
advances on behalf of others and quality guarantee
guarantee
deposits to be collected in daily activities.
Export tax This group is the declared export tax refund funds that
refund have not been received.
This group uses the age of accounts receivable as the
Open credits
credit risk characteristics.
Related Related party relationships (Unless there is evidence
parties that a credit loss may occur)
The Company's aging calculation method based on the combination of aging
recognition credit risk characteristics:
The aging of accounts receivables for the portfolio of credit risk features
recognized by aging is calculated as follows:
Aging Accrual ratio（%）
Not overdue 0.50
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Aging Accrual ratio（%）
More than 90 days overdue 100.00
The aging of other receivables for the portfolio of credit risk features recognized by
aging is calculated as follows:
Aging Accrual ratio（%）
More than one year 100.00
②Debt investment and other debt investment
For debt investment and other debt investment, the Company shall calculate the
expected credit loss through the default exposure and the 12-month or lifetime
expected credit loss rate based on the nature of the investment, counterparty and
the type of risk exposure.
If the financial instrument has a low risk of default, the borrower has a strong
capacity to meet its contractual cash flow obligations in the near term and adverse
changes in economic and business conditions in the longer term may, but will not
necessarily, reduce the ability of the borrower to fulfill its contractual cash flow
obligations.
The Company shall assess whether the credit risk on a financial instrument has
increased significantly since initial recognition, using the change in the risk of a
default occurring over the expected life of the financial instrument, through the
comparison of the risk of a default occurring on the financial instrument as at the
reporting date with the risk of a default occurring on the financial instrument as at
the date of initial recognition.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
To make that assessment, the Company shall consider reasonable and supportable
information, that is available without undue cost or effort, and that is indicative of
significant increases in credit risk since initial recognition, including forward-
looking information. The information considered by the Company are as following:
Significant changes in internal price indicators of credit risk as a result of a
change in credit risk since inception
Existing or forecast adverse change in the business, financial or economic
conditions of the borrower that results in a significant change in the borrower’s
ability to meet its debt obligations；
An actual or expected significant change in the operating results of the borrower;
An actual or expected significant adverse change in the regulatory, economic, or
technological environment of the borrower；
Significant changes in the value of the collateral supporting the obligation or in
the quality of third-party guarantees or credit enhancements, which are expected to
reduce the borrower ’ s economic incentive to make scheduled contractual
payments or to otherwise influence the probability of a default occurring;
Significant change that are expected to reduce the borrower ’ s economic
incentive to make scheduled contractual payments;
Expected changes in the loan documentation including an expected breach of
contract that may lead to covenant waivers or amendments, interest payment
holidays, interest rate step-ups, requiring additional collateral or guarantees, or
other changes to the contractual framework of the instrument；
Significant changes in the expected performance and behavior of the borrower；
Contractual payments are more than 30 days past due.
Depending on the nature of the financial instruments, the Company shall assess
whether the credit risk has increased significantly since initial recognition on an
individual financial instrument or a group of financial instruments. When assessed
based on a group of financial instruments, the Company can group financial
instruments on the basis of shared credit risk characteristics, for example, past due
information and credit risk rating.
Generally, the Company shall determine the credit risk on a financial asset has
increased significantly since initial recognition when contractual payments are
more than 30 days past due. The Company can only rebut this presumption if the
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Company has reasonable and supportable information that is available without
undue cost or effort, that demonstrates that the credit risk has not increased
significantly since initial recognition even though the contractual payments are
more than 30 days past due.
If the company no longer reasonably expects to recover all or part of the
contractual cash flows of a financial asset, the carrying amount of that financial
asset shall be directly reduced.
(9)Category and cost of inventory
Inventories are classified as: raw materials, work-in-progress, in-house semi-
finished goods, finished goods, low-value consumables, and goods in transit, etc.
Inventories are initially measured at cost, which includes purchase costs,
processing costs, and other expenditures incurred to bring the inventories to their
present location and condition.
(10)Valuation method of issued inventory
The cost of inventories used or sold is determined on the weighted average basis.
(11)inventory system
Adoption of perpetual inventory system.
(12)Amortization method of low-value consumables and packaging
① Low-value consumables are amortized using the one-time reversal method;
②The one-time reversal method is used for packaging.
(13)Recognition criteria and accrual method for provision for decline in value of
inventories
Inventories are stated at the lower of cost and net realizable value. The excess of
cost over net realizable value of the inventories is recognised as provision for
impairment of inventory, and recognised in current profit or loss.
Net realizable value of the inventory should be determined on the basis of reliable
evidence obtained, and factors such as purpose of holding the inventory and impact
of post balance sheet event shall be considered.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
① In normal operation process, finished goods, products and materials for direct
sale, their net realizable values are determined at estimated selling prices less
estimated selling expenses and relevant taxes and surcharges; for inventories held
to execute sales contract or service contract, their net realizable values are
calculated based on contract price. If the quantities of inventories specified in sales
contracts are less than the quantities held by the Company, the net realizable value
of the excess portion of inventories shall be based on general selling prices. Net
realizable value of materials held for sale shall be measured based on market price.
②For materials in stock need to be processed, in the ordinary course of production
and business, net realisable value is determined at the estimated selling price less
the estimated costs of completion, the estimated selling expenses and relevant taxes.
If the net realisable value of the finished products produced by such materials is
higher than the cost, the materials shall be measured at cost; if a decline in the price
of materials indicates that the cost of the finished products exceeds its net
realisable value, the materials are measured at net realisable value and differences
shall be recognised at the provision for impairment.
③The company generally makes provision for inventory impairment based on an
individual basis. For inventories with large quantity and low unit price, the
provisions for inventory impairment are determined on a category basis. Provision
for impairment in the value of inventories is made for inventories held in stock for
more than 180 days based on the estimated realisable value of inventories sold by
material category group.
④If any factor rendering write-downs of the inventories has been eliminated at the
reporting date, the amounts written down are recovered and reversed to the extent
of the inventory impairment, which has been provided for. The reversal shall be
included in profit or loss.
(14)Methods and criteria for recognition of contract assets
The Company presents contract assets or contract liabilities in the balance sheet
based on the relationship between the performance obligations and payments from
customers. The right to receive consideration for goods transferred or services
provided by the Company to the customer (and which is dependent on factors other
than the passage of time) is presented as a contract asset. Contract assets and
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
contract liabilities under the same contract are shown on a net basis. The
Company's unconditional (depending only on the passage of time) right to receive
consideration from customers is shown separately as receivables.
(15)Method of determining expected credit losses on contract assets and accounting
treatment
The methods of determining expected credit losses on contract assets and the
accounting treatment are described in detail in Note "III.9. (6)Methods of testing
and accounting treatment for impairment of Financial instrument" in this Note.
(16) Criteria for determining joint control and significant influence
Joint control refers to the control shared by an arrangement in accordance with the
relevant agreement, and the relevant activities of the arrangement can only be
decided with the unanimous consent of the participants sharing the control. If the
Company exercises joint control over an investee together with other joint venture
parties and has rights to the investee's net assets, the investee is a joint venture of
the Company.
Significant influence means having the power to participate in the financial and
operating decisions of the investee, but not being able to control or exercise joint
control with other parties over the formulation of those policies. Where the
Company is able to exercise significant influence over an investee, the investee is
an associate of the Company.
(17)Determination of initial investment
①Long-term equity investments resulting from business combinations
For long-term equity investments in subsidiaries formed by business combinations
under common control, the initial investment of long-term equity investments is
determined at the date of consolidation based on the acquisition of the share of the
ownership interest of the consolidated party in the book value of the consolidated
financial statements of the ultimate controlling party. The difference between the
initial investment cost of the long-term equity investment and the carrying value of
the consideration paid is adjusted against the equity premium in capital surplus; if
the equity premium in capital surplus is not sufficient for elimination, retained
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
earnings are adjusted. If the Company is able to exercise control over an investee
under the same control due to additional investment, the difference between the
initial investment cost of the long-term equity investment recognized in accordance
with the above principle and the sum of the book value of the long-term equity
investment before reaching the consolidation plus the book value of the
consideration paid for further acquisition of shares at the date of consolidation is
adjusted against equity premium, and if the equity premium is not sufficient for
elimination, it is reduced against retained earnings.
For long-term equity investments in subsidiaries formed through business
combinations not under common control, the initial investment cost of the long-
term equity investment is based on the cost of the combination determined at the
date of acquisition. If it is possible to exercise control over the investee under non-
same control due to additional investment, the sum of the book value of the equity
investment originally held plus the cost of the additional investment is used as the
initial investment cost.
②Long-term equity investments acquired through other means instead of business
combination
Long-term equity investments acquired by cash payment are recorded at initial
investment cost based on the actual purchase price paid.
Long-term equity investments acquired by issuing equity securities are recorded at
the initial investment cost based on the fair value of the equity securities issued.
(18)Subsequent measurement and profit or loss recognition methods
① Long-term equity investments accounted for under the cost method
The Company accounts for its long-term equity investments in subsidiaries using
the cost method unless the investments meet the conditions of being held for sale.
Except for the declared but unpaid cash dividends or profits included in the actual
price or consideration paid for the investment, the Company recognizes investment
income for the current period based on the Company's entitlement to the declared
cash dividends or profits of the investee.
②Long-term equity investments accounted for under the equity method
Long-term equity investments in associates and joint ventures are accounted for
using the equity method. The difference between the initial investment cost and
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
the share of the fair value of the identifiable net assets of the investee at the time of
investment is not adjusted to the initial investment cost of the long-term equity
investment; the difference between the initial investment cost and the share of the
fair value of the identifiable net assets of the
investee at the time of investment is recognized in profit or loss for the current
period and the cost of the long-term equity investment is also adjusted.
The Company recognizes investment income and other comprehensive income
according to the share of net profit or loss and other comprehensive income
realized by the investee, respectively, and adjusts the carrying value of the long-
term equity investment at the same time; the portion to which the Company is
entitled according to the profit or cash dividends declared by the investee is
calculated, and the carrying value of the long-term equity investment is reduced
accordingly; for the investee's ownership interest other than net profit or loss, other
comprehensive income and profit distribution For changes in the equity of the
investee other than net profit or loss, other comprehensive income and profit
distribution ("changes in other owners'equity"), the carrying amount of the long-
term equity investment is adjusted and recognized in owners' equity.
In recognizing the share of the investee's net profit or loss, other comprehensive
income and other changes in owners'equity, the fair value of the investee's
identifiable net assets at the time of acquisition is used as the basis for recognition,
and the net profit and other comprehensive income of the investee are adjusted in
accordance with the Company's accounting policies and accounting periods.
Unrealized gains or losses on internal transactions between the company and
associate and joint ventures that are attributable to the Company on the basis of
their proportionate share are offset and investment income is recognized on this
basis, except when the assets invested or sold constitute a business. Unrealized
losses on internal transactions with investees are recognized in full if there are
impairment losses on assets.
The net loss incurred by the company in a joint venture or an associate, except for
the obligation to assume additional losses, is limited to a write-down to zero of the
carrying amount of the long-term equity investment and other long-term interests
that substantially constitute the net investment in the joint venture or associate. If
the joint venture or associate subsequently realizes net profit, the Company
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
resumes recognition ofrevenue sharing after the revenue sharing amount makes up
for the unrecognized loss sharing amount.
③Disposal of long-term equity investments
The difference between the carrying amount and the actual acquisition price of a
long-term equity investment is recognized in profit or loss for the current period.
If a long-term equity investment accounted for under the equity method is partially
disposed of and the remaining equity interest is still accounted for under the equity
method, the other comprehensive income recognized under the former equity
method is carried forward in proportion to the corresponding percentage using the
same basis as the direct disposal of the related assets or liabilities by the investee,
and other changes in owners'equity are carried forward in proportion to the current
profit or loss.
If the common control or significant influence over the investee is lost due to the
disposal of equity investments, etc., other comprehensive income recognized as a
result of the adoption of the equity method of accounting for the original equity
investment is accounted for on the same basis as the direct disposal of the related
assets or liabilities of the investee upon the termination of the adoption of the
equity method of accounting, and all changes in other owners'equity are transferred
to current profit or loss upon the termination of the adoption of the equity method
of accounting.
If control over the investee is lost due to disposal of part of the equity investment,
the remaining equity interest that can exercise joint control or significant influence
over the investee is accounted for under the equity method in the preparation of
individual financial statements, and the remaining equity interest is adjusted as if it
had been accounted for under the equity method from the time of acquisition, and
other comprehensive income recognized prior to the acquisition of control over the
investee is accounted for on the same basis as if the investee had directly disposed
of the related assets or liabilities. If the remaining equity interest cannot exercise
joint control or significant influence over the investee, it is recognized as a
financial asset, and the difference between its fair value and its carrying amount at
the date of loss of control is recognized in profit or loss for the
current period, and for other comprehensive income and other owner's equity
recognized prior to the acquisition of control of the investee, the remaining equity
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
interest is recognized in profit or loss for the current period. All other
comprehensive income and other changes in owners'equity recognized prior to the
acquisition of control of the investee are carried forward.
If the disposal of an equity investment in a subsidiary through multiple transactions
until the loss of control is a package transaction, each transaction is accounted for
as a disposal of an equity investment in a subsidiary and the loss of control; the
difference between the disposal price and the carrying value of the long-term
equity investment corresponding to the equity interest disposed of before the loss
of control is recognized as other comprehensive income in the individual financial
statements, and then recognized as other comprehensive income when control is
lost. The difference between the disposal price and the carrying amount of the long-
term equity investment before the loss of control is recognized as other
comprehensive income in the individual financial statements, and then transferred
to profit or loss in the period in which control is lost. If it is not a package
transaction, each transaction is accounted for separately.
Investment property refers to real estate held to earn rentals or for capital appreciation, or
both. It includes land use rights that have been leased out, land use rights held and
intended to be transferred after appreciation, and buildings that have been leased out
(including buildings constructed or developed by the company for leasing purposes, as
well as buildings under construction or development intended for future leasing).
Subsequent expenditures related to investment property shall be included in the cost of the
investment property if it is probable that the associated economic benefits will flow to the
entity and the cost can be measured reliably; otherwise, they are recognized in profit or
loss for the period when incurred.
The company measures existing investment property using the cost model. For investment
property - leased buildings measured at cost, the same depreciation policy applied to the
company's fixed assets is used. The amortization policy for leased land use rights follows
the same approach as for intangible assets.
(19)Recognition and initial measurement of fixed assets
Fixed assets are tangible assets held for the production of goods, provision of
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
services, rental or management, and with a useful life of more than one fiscal year .
A fixed asset is recognized when both of the following conditions are met:
① It is probable that the economic benefits associated with the fixed asset will
flow to the enterprise;
② The cost of the fixed asset can be measured reliably.
Fixed assets are initially measured at cost (taking into account the effect of
expected disposal costs).
Subsequent expenditures related to fixed assets are included in the cost of fixed
assets when it is probable that the economic benefits associated with them will
flow to the enterprise and their cost can be measured reliably; for the replaced part,
the carrying amount is derecognized; all other subsequent expenditures are charged
to current profit or loss when incurred.
(20)Depreciation Method
Depreciation of fixed assets is provided using the average annual method, and the
depreciation rate is determined based on the category of fixed assets, estimated
useful life and estimated net residual value rate. For fixed assets with provision for
impairment, the depreciation amount is determined in future periods based on the
carrying amount after deducting the provision for impairment and based on the
remaining useful life. If each component of fixed assets has different useful lives or
provides economic benefits to the enterprise in different ways, different
depreciation rates or depreciation methods are selected and depreciated separately.
The depreciation methods, useful lifes, residual value rate and annual depreciation
rates of various types of fixed assets are as follows:
Estimated
Depreciatio Residual Annual depreciation
Category useful life
n method rates (%) rates (%)
(year)
Straight-
Buildings and
line 7.00-10.00 12-20 4.50-7.50
constructions
method
Straight-
Machinery equipment line 0.00 4-15 6.67-25.00
method
Electrical equipment, Model, Straight- 0.00 5-6 16.67-20.00
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Estimated
Depreciatio Residual Annual depreciation
Category useful life
n method rates (%) rates (%)
(year)
and other line
method
Straight-
Vehicles line 0.00 6-11 9.09-16.67
method
Improvement Straight- Amortisation shall be made according
expenditure of leased line 0.00 to the shorter of benefit period and
fixed assets method lease period
(21)Disposal of fixed assets
Fixed assets are derecognized when they are disposed of, or when no economic
benefits are expected to arise from their use or disposal. The disposal proceeds
from the sale, transfer,scrapping or destruction of fixed assets, net of their book
value and related taxes and fees, are recognized in profit or loss for the current
period.
Construction in progress is measured at its actual incurred costs. Actual costs include
construction costs, installation costs, borrowing costs eligible for capitalization, and other
necessary expenditures incurred to bring the construction in progress to its intended
usable state. When the construction in progress reaches its intended usable state, it is
transferred to property, plant, and equipment (fixed assets) and depreciation begins from
the following month.
For fixed assets that have reached their intended usable state but have not yet completed
final settlement procedures, they are provisionally transferred to fixed assets at estimated
values based on project budgets, cost estimates, or actual incurred costs from the date they
reach their intended usable state. Depreciation is calculated according to the company's
fixed asset depreciation policy. Once the final settlement procedures are completed, the
originally estimated provisional values are adjusted to reflect the actual costs, but
previously recognized depreciation amounts are not adjusted.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(22)Recognition Principles for Capitalization of Borrowing Costs
Borrowing costs directly attributable to the acquisition or construction of
qualifying assets are capitalized and included in the cost of those assets. Other
borrowing costs are recognized as an expense when they are incurred and included
in profit or loss for the period.
A qualifying asset is one that necessarily takes a substantial period of time to get
ready for its intended use or sale, such as property, plant, and equipment,
investment property, and inventories.
(23)Period of Capitalization of Borrowing Costs
The capitalization period refers to the duration from the start of capitalizing
borrowing costs until the cessation of capitalization, excluding periods when
capitalization is suspended.
Borrowing costs begin to be capitalized when all the following conditions are met:
① Expenditure on the asset has been incurred, which includes payments made in
cash, non-cash consideration, or liabilities bearing interest for the acquisition or
production of a qualifying asset.
②Borrowing costs have been incurred.
③ Activities necessary to prepare the asset for its intended use or sale have
commenced. Capitalization of borrowing costs ceases when the qualifying asset is
ready for its intended use or sale.
(24)Suspension of Capitalization Period
If there is an abnormal interruption during the construction or production of a
qualifying asset and the interruption lasts continuously for more than three months,
the capitalization of borrowing costs should be suspended. However, if the
interruption is a necessary part of the process for preparing the asset for its
intended use or sale, borrowing costs continue to be capitalized. During the
suspension period, borrowing costs are recognized as an expense until the
construction or production activities resume.
(25)Calculation Methods for Capitalization Rate and Amount of Borrowing Costs
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
For specific borrowings taken out to acquire or construct a qualifying asset, the
amount of borrowing costs to be capitalized is determined by subtracting the
interest income earned from depositing unused funds in a bank or from temporary
investments from the actual borrowing costs incurred during the period.
For general borrowings used to acquire or construct a qualifying asset, the amount
of borrowing costs to be capitalized is calculated by multiplying the weighted
average of the expenditures exceeding the amount of specific borrowings by the
capitalization rate of the general borrowings. The capitalization rate is based on the
weighted average effective interest rate of the general borrowings.
During the capitalization period, exchange differences arising from foreign
currency denominated specific borrowings and their interest are capitalized and
included in the cost of qualifying assets. Exchange differences arising from other
foreign currency borrowings and their interest are recognized as expenses in profit
or loss.
(26)Valuation method of intangible assets
①The company initially measures intangible assets at cost when they are acquired;
The cost of an externally acquired intangible asset includes the purchase price,
related taxes and other expenses directly attributable to bringing the asset to its
intended use.
②Subsequent measurement
The useful life of an intangible asset is analyzed and determined at the time of
acquisition.For intangible assets with finite useful lives, they are amortized over
the period in which they bring economic benefits to the enterprise; if the period in
which the intangible assets bring economic benefits to the enterprise cannot be
foreseen, they are considered to be intangible assets with indefinite useful lives and
are not amortized.
(27)The useful life and amortisation of intangible assets
Category Estimated useful life Basis
Land use right 20-50years Legal right of use
Software 3-5years The service life is
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Category Estimated useful life Basis
determined by reference to
the period that can bring
economic benefits to the
Company
(28)Criteria for Judging Indefinite-Lived Intangible Assets and Procedures for
Reviewing Their Useful Lives Indefinite-Lived Intangible Assets
For intangible assets with an indefinite useful life, no amortization is recognized.
These assets are not amortized because their useful lives cannot be reliably
estimated.
At the end of each annual period, the useful life of indefinite-lived intangible assets
should be reviewed. If evidence indicates that the useful life of an intangible asset
is actually finite, its useful life should be estimated, and the asset should be
amortized systematically and rationally over its estimated useful life.
(29)Scope of Research and Development(R&D) expenditure Classification
The Company classifies all costs directly related to the conduct of research and
development activities as research and development expenses, including research
and development employee compensation, depreciation and amortisation expenses,
testing expenses, maintenance expenses, patent fees and other expenses.
(30)Specific criteria for classifying research and development phases
Expenditures on in-house research and development projects are categorized into
research stage expenditures and development stage expenditures.
Research stage: the stage of original and planned investigation and research
activities for the purpose of acquiring and understanding new scientific or
technological knowledge.
Development phase: the stage of applying research results or other knowledge to a
plan or design to produce new or substantially improved materials, devices,
products and other activities before commercial production or use.
(31)The specific conditions for capitalization of development stage expenditures
Expenditures in the research stage are recognized in profit or loss when they are
incurred. Expenditures in the development phase are recognized as intangible
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
assets if the following conditions are met. Expenditures in the development phase
that do not meet the following conditions are recognized in the current period's
profit or loss:
① It is technically feasible to complete the intangible asset so that it can be used or
sold;
② There is an intention to complete the intangible asset for use or sale;
③ The manner in which the intangible asset will generate economic benefits,
including the ability to demonstrate the existence of a market for the products
produced by applying the intangible asset or the existence of a market for the
intangible asset itself, and the usefulness of the intangible asset if it will be used
internally;
④The availability of sufficient technical, financial and other resources to support
the completion of the development of the intangible asset and the ability to use or
sell the intangible asset;
⑤Expenditures attributable to the development phase of the intangible asset can be
measured reliably.
If it is not possible to distinguish between research-phase expenditures and
development-phase expenditures, all research and development expenditures
incurred are recognized in the current period's profit or loss.
Long-term equity investments, investment properties measured using the cost model,
fixed assets, construction in progress, right-of-use assets, intangible assets with finite
useful lifes,oil and gas assets and other long-term assets are tested for impairment if there
is an indication of impairment at the balance sheet date. If the result of the impairment test
indicates that the recoverable amount of an asset is less than its carrying amount, a
provision for impairment is made for the difference and an impairment loss is recorded.
The recoverable amount is the higher of the asset's fair value less costs of disposal and the
present value of estimated future cash flows of the asset. The provision for asset
impairment is calculated and recognized on an individual asset basis. If it is difficult to
estimate the recoverable amount of an individual asset, the recoverable amount of the
asset group is determined using the asset group to which the asset belongs. An asset group
is the smallest combination of assets that can generate cash inflows independently.
For goodwill resulting from business combinations, intangible assets with indefinite
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
useful lives, and intangible assets that have not yet reached a serviceable status,
impairment tests are performed once a year at the end of each year, regardless of whether
there is an indication of impairment.
The Company conducts goodwill impairment tests and apportions the carrying value of
goodwill formed as a result of a business combination to the relevant asset group from the
date of purchase in accordance with a reasonable method; if it is difficult to apportion to
the relevant asset group, it is apportioned to the relevant asset group combination. A
relevant asset group or a combination of asset groups is an asset group or a combination
of asset groups that can benefit from the synergistic effect of a business combination.
When impairment test of the relevant asset group or combination of asset groups that
contain goodwill, if there is an indication of impairment of the asset group or combination
of asset groups related to goodwill, the asset group or combination of asset groups that do
not contain goodwill is first tested for impairment, the recoverable amount is calculated
and compared with the relevant carrying amount, and a corresponding impairment loss is
recognized. If the recoverable amount is less than the carrying amount, the impairment
loss is first reduced by the carrying amount of goodwill apportioned to the asset group or
group of assets, and then reduced by the carrying amount of each asset group or group of
assets other than goodwill in proportion to its proportionate share of the carrying amount
of the other assets. The carrying value of each asset is then reduced by the carrying value
of each asset other than goodwill.
Once the above impairment loss is recognized, it will not be reversed in subsequent
accounting periods.
Long-term deferred expenses are various expenses already incurred, which shall be
amortized over current and subsequent periods with the amortization period exceeding
one year.
Long-term deferred expenses are amortized on a straight-line basis during the benefit
period.
An entity’ s obligation to transfer goods or services to a customer for which the entity
has received consideration (or the amount is due) from the customer. Contract asset and
contract liability originate from same contact shall be listed at net amount.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(32)Accounting for short-term compensation
The Company recognizes actual short-term compensation incurred by employees
as a liability in the accounting period in which the employees provide services to
the Company, and recognizes it in the current profit or loss or the cost of related
assets.
The social insurance premiums and housing fund paid by the Company for its
employees, as well as the labor union funds and employee education funds
withdrawn in accordance with regulations, are used to determine the corresponding
amount of employee compensation in accordance with the prescribed accrual basis
and accrual ratio during the accounting period in which the employees provide
services to the Company.
Employee benefit expenses incurred by the Company are charged to current profit
or loss or the cost of related assets based on the actual amount incurred when
incurred, of which non-monetary benefits are measured at fair value.
(33)Accounting for post-employment benefits
①Defined contribution plan
The Company contributes to basic pension and unemployment insurance for
employees in accordance with the relevant local government regulations. During
the accounting period in which the employees provide services to the Company, the
amount payable is calculated based on the contribution base and ratio set by the
local regulations, recognized as a liability, and charged to current profit or loss or
cost of related assets. In addition, the Company participates in an enterprise annuity
plan/supplemental pension fund approved by the relevant state authorities. The
Company contributes a certain percentage of the employees' total salaries to the
annuity plans/local social insurance agencies, and the corresponding expenses are
recognized in the current profit or loss or cost of related assets.
② Defined benefit plans
The Company attributes the benefit obligations arising from the defined benefit
plans to the period in which the employees render services in accordance with the
formula determined by the expected accumulated benefit unit method, and
recognizes them in current profit or loss or cost of related assets.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
The deficit or surplus resulting from the present value of the defined benefit plan
obligation less the fair value of the defined benefit plan assets is recognized as a
net defined benefit plan liability or net asset. If a defined benefit plan has a surplus,
the Company measures the net defined benefit plan asset at the lower of the surplus
or asset limit of the defined benefit plan.
All defined benefit plan obligations, including those expected to be paid within
twelve months after the end of the annual reporting period in which employees
render services, are discounted based on market yields on treasury bonds or high-
quality corporate bonds in active markets that match the maturity and currency of
the defined benefit plan obligations as of the balance sheet date.
The service cost incurred by the defined benefit plan and the net interest on the net
liabilities or net assets of the defined benefit plan are recognized in profit or loss or
the cost of the related assets; changes resulting from theremeasurement of the net
liabilities or net assets of the defined benefit plan are recognized in other
comprehensive income and are not reversed to profit or loss in subsequent
accounting periods, and the entire portion previously recognized in other
comprehensive income is carried forward to unrecognized earnings to the extent of
equity upon termination of the original defined benefit plan. The portion of other
comprehensive income withinequity is transferred to unappropriated earnings upon
termination of the defined benefit plan.
Upon settlement of a defined benefit plan, again or loss on settlement is recognized
as the difference between the present value of the defined benefit plan obligation
and the settlement price determined at the settlement date.
(34)Accounting for termination benefits
If the Company provides termination benefits to employees, it recognizes
employee compensation liabilities arising from termination benefits and recognizes
them in profit or loss at the earlier of: when the Company cannot unilaterally
withdraw termination benefits provided as a result of a termination plan or a
proposed reduction in force; and when the Company recognizes costs or expenses
related to a restructuring involving the payment of termination benefits.
The Company recognizes an obligation related to a contingent event as an accrued
liabilities when the following conditions are simultaneously mets:
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
①The obligation is a present obligation assumed by the Company;
② It is probable that the performance of the obligation will result in an outflow of
economic benefits to the Company;
③ The amount of the obligation can be measured reliably.
A provision is initially measured at the best estimate of the expenditure required to settle
the related present obligation.
In determining the best estimate, the risks associated with the contingency, uncertainty
and the time value of money are considered. Where the effect of the time value of money
is material, the best estimate is determined by discounting the related future cash outflows.
Where a continuous range of expenditures required exists and it is equally probable that
various outcomes will occur within that range, the best estimate is determined at the mid-
point of the range; in other cases, the best estimate is treated separately as follows:
- Where the contingency relates to a single item, the best estimate is determined in
accordance with the most probable occurrence amount.
- If the contingency involves multiple items, it is determined on the basis of various
possible outcomes and related probabilities.
If all or part of the expenditure required to settle the estimated liability is expected to be
reimbursed by athird party, the amount of reimbursement is recognized separately as an
asset when it is substantially certain that it will be received, and the amount of
reimbursement recognized does not exceed the carrying amount of the estimated liability.
The Company reviews the carrying amount of the estimated liability at the balance sheet
date, and if there is conclusive evidence that the carrying amount does not reflect the
current best estimate, the carrying amount is adjusted in accordance with the current best
estimate.
(35)Accounting policies used for revenue recognition and measurement
The Company recognizes revenue when it has fulfilled its performance obligations
under a contract, i.e., when the customer obtains control of the relevant goods or
services. The acquisition of control of the relevant goods or services is defined as
the ability to dominate the use of the goods or services and derive substantially all
of the economic benefits therefrom.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
If a contract contains two or more performance obligations, the Company
apportions the transaction price to each individual performance obligation on the
contract commencement date in proportion to the relative share of the individual
selling price of the goods or services promised by each individual performance
obligation. The Company measures revenue based on the transaction price
apportioned to each individual performance obligation.
The transaction price is the amount of consideration to which the Company expects
to be entitled as a result of the transfer of goods or services to the customer,
excluding amounts collected on behalf of third parties and amounts expected to be
refunded to the customer. The Company determines the transaction price in
accordance with the terms of the contract, taking into account its past customary
practices, and considers the impact of variable consideration, the existence of
significant financing components in the contract, non-cash consideration, and
consideration payable to the customer in determining the transaction price. The
Company determines the transaction price that includes variable consideration by
an amount that does not exceed the amount for which it is highly probable that
there will be no material reversal of the cumulative recognized revenue at the time
the relevant uncertainty is removed. If there is a significant financing component
in the contract, the Company determines the transaction price based on the amount
payable in cash assuming that the customer will pay for the goods or services as
soon as control is obtained, and amortizes the difference between this transaction
price and the contract consideration using the effective interest rate method over
the term of the contract.
Performance obligations are fulfilled within a certain period of time if one of the
following conditions is met, otherwise, performance obligations are fulfilled at a
certain point in time:
- The customer obtains and consumes the economic benefits resulting from the
Company's performance at the sametime as the Company's performance.
- The customer is able to control the goods under construction in the course of the
Company's performance.
- The goods produced in the course of the Company's performance have
irreplaceable use and the Company is entitled to receive payment for the portion
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
of the performance that has been completed to date in the aggregate throughout the
term of the contract.
For performance obligations performed within a certain period of time, the
Company recognizes revenue in accordance with the progress of performance
during that period,
except when the progress of performance cannot be reasonably determined. The
Company uses the output method or input method to determine the progress of
performance, taking into account the nature of the goods or services. When the
progress of performance cannot be reasonably determined, the Company
recognizes revenue in the amount of costs already incurred until the progress of
performance can be reasonably determined, if the costs already incurred are
expected to be reimbursed.
For performance obligations performed at a point in time, the Company recognizes
revenue at the point in time when the customer obtains control of the related goods
or services. In determining whether the customer has acquired control of the goods
or services, the Company considers the following indications:
- The Company has a present right to receive payment for the goods or services, i.e.,
the customer has a present obligation to pay for the goods or services.
- The Company has transferred legal title to the goods to the customer, i.e., the
customer has legal title to the goods.
- The Company has transferred physical possession of the goods to the customer,
i.e. the customer has taken physical possession of the goods.
- The Company has transferred the principal risks and rewards of ownership of the
goods to the customer, i.e., the customer has acquired the principal risks and
rewards of ownership of the goods.
- The customer has accepted the goods or services, etc.
The Company determines whether its status is that of a principally liable person or
an agent at the time of engaging in a transaction based on whether it has control
over the goods or services prior to transferring them to the customer. If the
Company is able to control the goods or services prior to transferring them to the
customer, the Company is the principal and recognizes revenue based on the total
consideration received or receivable; otherwise, the Company is the agent and
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
recognizes revenue based on the amount of commissions or fees it expects to be
entitled to receive.
(36)Disclosure of specific revenue recognition and measurement methods by
business type
①Sale of goods
The sales contract between the Company and the customer includes the
performance obligation of transferring the goods, which belongs to the
performance obligation at a certain point in time.
Recognition of domestic sales product revenue must meet the following conditions:
the Company has delivered the products to the customer according to the contract
and the customer has accepted the products; the payment has been recovered or the
receipt of payment has been obtained, and the relevant economic benefits are likely
to flow in; the main risks and rewards of the ownership of the goods have been
transferred, and the legal ownership of the goods has been transferred.
Recognition of exporting revenue must meet the following conditions: The
Company recognizes revenue for exporting goods based on the sales contracts or
sales orders, regardless of the sales model adopted. For sales model of FOB, the
revenue is recognised after the products are shipped and the customs declaration
and export formalities are handled; For sales model of FCA, the revenue is
recognised when products are delivered to the carrier designated by the buyer
Treatment of sales return: according to the general rules of international trade, the
adoption of FOB and CIF settlement indicates that the buyer has accepted the
purchased goods at the place of shipment, and the relevant risks have been
undertaken by the buyer after the acceptance and shipment. Therefore, the
Company does not make provision for the above matters separately, but directly
records them into the profits and losses in the current period.
Processing of product claims: the estimated claim expense rate is calculated based
on the actual claim amount in the past two years (excluding special claims) as a
percentage of the annual sales revenue, and accrued at period end based on the
current sales revenue and the estimated claim expense rate to recognize the claim
expenses for products sold in the current period.
②Service contract
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
The performance obligation of the service contract between the Company and the
customer. Since the customer obtains and consumes the economic benefits brought
by the Company ’ s performance at the same time as the Company fulfills the
contract, the Company recognises it as a performance obligation performed within
a certain period of time, and amortized equally during the service provision period.
③Construction contract
For the performance obligation of the construction contract between the Company
and the customer, since the customer can control the goods under construction in
the process of the Company's performance, the Company takes it as the
performance obligation to perform in a certain period of time, and recognizes the
income according to the performance progress, except that the performance
progress cannot be reasonably determined. The Company determines the progress
of the performance of providing services in accordance with the output method.
The progress of the performance shall be determined according to the proportion of
the completed contract workload to the expected total contract workload. On the
balance sheet date, the Company re-estimates the progress of completed
performance or completed services to reflect the changes in performance.
(37)Types
Government grants, which are monetary or non-monetary assets acquired by the
Company from the government without compensation, are classified as asset-
related government grants and revenue-related government grants.
Government grants related to assets are obtained by the Company for the
acquisition and construction or otherwise forming long-term assets. Revenue-
related government grants refer to government grants other than asset-related
government grants.
The specific criteria for the Company to classify government grants as asset-related
are: government grants obtained by the Company and used for the acquisition and
construction or otherwise forming long-term assets.
The Company's specific criteria for classifying government grants as revenue-
related are: government grants other than those related to assets.
(38)Recognition point
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Government grants are recognized when the Company is able to meet the
conditions attached to them and when they can be received.
(39)Accounting treatment
Government grants related to assets are reduced to the carrying amount of the
relevant assets or recognized as deferred income. If recognized as deferred income,
it is recognized in profit or loss in accordance with a reasonable and systematic
method in installments over the useful life of the relevant assets (if it is related to
the Company's daily activities, it is recognized in other income; if it is not related
to the Company's daily activities, it is recognized in non-operating income);
Government grants related to revenue, which are used to compensate the Company
for relevant costs and expenses or losses in subsequent periods, are recognized as
deferred revenue and charged to current profit or loss (to other income if they are
related to the Company's ordinary activities; to non-operating income if they are
not related to the Company's ordinary activities) or offset against relevant costs and
expenses or losses in the period in which the relevant costs and expenses or losses
are recognized; to compensate the Company for If it is used to compensate the
Company for the related costs or losses incurred, it is directly recognized in profit
or loss (other income if it is related to the Company's daily activities; non-operating
income if it is not related to the Company's daily activities) or reduced by the
related costs or losses.
The company receives preferential loan subsidies under two distinct scenarios,
each requiring specific accounting treatment:
①If the fiscal authority provides the subsidy funds to the lending bank, which then
offers loans to the company at a preferential interest rate, we record the loan at the
actual amount received. The borrowing costs are calculated based on the principal
amount of the loan and the preferential interest rate.
②If the fiscal authority directly pays the subsidy funds to the company, we offset
the corresponding subsidy against the related borrowing costs.
Income taxes consist of current income taxes and deferred income taxes. The Company
recognizes current income tax and deferred income tax in profit or loss, except for income
tax arising from business combinations and transactions or events directly recognized in
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
owners'equity (including other comprehensive income).
Deferred income tax assets and deferred income tax liabilities are recognized based on the
difference between the tax basis of assets and liabilities and their carrying amounts
(temporary differences).
Deferred tax assets are recognized for deductible temporary differences to the extent that
it is probable that taxable income will be available in future periods against which the
deductible temporary differences can be utilized. For deductible losses and tax credits that
can be carried forward to future years, deferred tax assets are recognized to the extent that
it is probable that future taxable income will be available against which the deductible
losses and tax credits can be utilized.
Deferred income tax liabilities are recognized for taxable temporary differences, except
under special circumstances.
The special circumstances under which deferred tax assets or deferred tax liabilities are
not recognized include
- Initial recognition of goodwill;
- Transactions or events that are neither business combinations nor, at the time of their
occurrence, affect accounting profit and taxable income (or deductible losses), and for
which the initial recognition of assets and liabilities does not result in taxable temporary
differences and deductible temporary differences of an equivalent amount.
Deferred income tax liabilities are recognized for taxable temporary differences
associated with investments in subsidiaries, associates and joint ventures, unless the
Company is able to control the timing of the reversal of the temporary difference and it is
probable that the temporary difference will not reverse in the foreseeable future. Deferred
income tax assets are recognized for deductible temporary differences associated with
investments in
subsidiaries, associates and joint ventures when it is probable that the temporary
differences will reverse in the foreseeable future and it is probable that future taxable
income will be available against which the deductible temporary differences can be
utilized.
At the balance sheet date, deferred income tax assets and deferred income tax liabilities
are measured at the tax rates applicable to the periods when the related assets are expected
to be recovered or the related liabilities settled, in accordance with the tax laws.
At the balance sheet date, the Company reviews the carrying amount of deferred tax
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
assets. The carrying amount of deferred tax assets is written down if it is more likely than
not that sufficient taxable income will not be available in future periods to offset the
benefit of the deferred tax assets. To the extent that it is probable that sufficient taxable
income will be available, the written down amount is reversed.
When there is a legal right to settle on a net basis and the intention is to settle on a net
basis or to acquire assets and settle liabilities simultaneously, current income tax assets
and current income tax liabilities are stated at the net amount after offsetting.
At the balance sheet date, deferred income tax assets and deferred income tax liabilities
are presented on a net basis after offsetting when both of the following conditions are met:
- The taxable entity has the legal right to settle current income tax assets and current
income tax liabilities on a net basis;
- Deferred income tax assets and deferred income tax liabilities relate to income taxes
levied by the same tax authority on the same taxable entity or to different taxable entities,
but in each future period in which it is significant that the deferred income tax assets and
liabilities reverse, the taxable entities involved intend to settle the current income tax
assets and liabilities on a net basis or to acquire the assets and The reversal of deferred
income tax assets and liabilities is a significant transaction.
A lease is a contract in which the lessor cedes the right to use an asset to the lessee for a
certain period of time for consideration. At the inception date of the contract, the
Company assesses whether the contract is a lease or contains a lease. A contract is a lease
or contains a lease if one party to the contract cedes the right to control the use of one or
more identified assets for a certain period of time in exchange for consideration.
If a contract contains several separate leases, the Company splits the contract and
accounts for each separate lease separately. If a contract contains both lease and non-lease
components, the lessee and the lessor split the lease and non-lease components.
(40)The Company as lessee
①Right-of-use assets
At the commencement date of the lease term, the Company recognizes right-of-use
assets for leases other than short-term leases and leases of low-value assets. Right-
of-use assets are initially measured at cost. This cost includes:
- the initial measurement amount of the lease liability;
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
- the amount of lease payments made on or before the commencement date of the
lease term, net of amounts related to lease incentives taken if lease incentives exist;
- the initial direct costs incurred by the Company;
- costs that the Company expects to incur to disassemble and remove the leased
asset,restore the site where the leased asset is located, or restore the leased asset to
the condition agreed upon under the terms of the lease, excluding costs that are part
of the costs incurred to produce the inventory.
The Company subsequently depreciates right-of-use assets using the straight-line
method. If it is reasonably certain that ownership of the leased asset will be
obtained at the end of the lease term, the Company depreciates the leased asset
over its remaining useful life;otherwise, the leased asset is depreciated over the
shorter of the lease term or the remaining useful life of the leased asset.
The Company determines whether a right-of-use asset is impaired and accounts for
the identified impairment loss in accordance with the principles described in Note
III.9, "Impairment of Long-lived Assets".
②Lease liabilities
The Company recognizes a lease liability for leases other than short-term leases
and leases of low-value assets at the commencement date of the lease term. Lease
liabilities are initially measured at the present value of the outstanding lease
payments. Lease payments consist of
- fixed payments (including material fixed payments), net of amounts related to
lease incentives, if lease incentives exist;
- variable lease payments that are dependent on an index or rate;
- payments expected to be payable based on the residual value of the guarantee
provided by the company;
- the exercise price of the purchase option, provided that the company reasonably
determines that it will exercise the option;
- the amount to be paid upon exercise of the option to terminate the lease, provided
that the lease term reflects that the Company will exercise the option to terminate
the lease.
The Company uses the interest rate embedded in the lease as the discount rate, but
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
if the interest rate embedded in the lease cannot be reasonably determined, the
Company'sincremental borrowing rate is used as the discount rate.
The Company calculates the interest expense on the lease liability for each period
of the lease term based on a fixed periodic interest rate, which is included in the
current profit or loss or the cost of the related asset.Variable lease payments that are
not included in the measurement of the lease liability are charged to current profit
or loss or the cost of the related assets when they are actually incurred.
After the commencement date of the lease term, the Company remeasures the lease
liability and adjusts the corresponding right-of-use asset if the carrying value of the
right- of-use asset has been reduced to zero, but the lease liability still needs to be
further reduced, the difference is recognized in profit or loss for the current period:
- When there is a change in the valuation of the purchase option, lease renewal
option or termination option, or when the actual exercise of the aforementioned
options is not consistent with the original valuation, the Company remeasures the
lease liability at the present value calculated by the changed lease payments and the
revised discount rate;
- When there is a change in the substantive fixed payment amount, a change in the
amount expected to be payable for the guaranteed residual value, or a change in the
index or rate used to determine the lease payment amount, the Company
remeasures the lease liability at the present value calculated from the changed lease
payment amount and the original discount rate. However, if the change in the lease
payment amount results from a change in the floating interest rate, the present
value is calculated using the revised discount rate.
③Short-term leases and leases of low-value assets
The Company has elected not to recognize right-of-use assets and lease liabilities
for short- term leases and leases of low-value assets, and to recognize the related
lease payments in current profit or loss or the cost of the related assets on a
straight-line basis over each period of the lease term. Short-term leases, which
areleases with a lease term of not more than 12 months at the commencement date
of the lease term and do not include a purchase option. Low-value asset leases,
which areleases with a lower value when the single leased asset is a brand-new
asset. If the company subleases or expects to sublease the leased assets, the original
lease is not a low-value asset lease.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
④Change of lease
If a lease is changed and the following conditions are met at the sametime, the
company will account for the lease change as a separate lease:
- the lease modification expands the scope of the lease by adding the right to use
one or more leased assets;
- The increased consideration is equivalent to the separate price of the expanded
portion of the lease adjusted for the circumstances of that contract.
If a lease modification is not accounted for as a separate lease, at the effective date
of the lease modification, the company reapportioned the consideration of the
modified contract, redetermined the lease term, andremeasured the lease liability
based on the present value of the modified lease payments and the revised discount
rate.If a lease change results in a reduction in the scope of the lease or a shortening
of the lease term, the Company reduces the carrying value of the right-of-use asset
accordingly and recognizes the gain or loss related to partial termination or
complete termination of the lease in profit or loss for the current period. If other
lease changes result in the remeasurement of the lease liability, the Company
adjusts the carrying value of the right- of-use asset accordingly.
(41)The Company as lessor
At the commencement date of the lease, the Company classifies leases into finance
leases and operating leases. A finance lease is a lease that transfers substantially all
the risks and rewards associated with ownership of the leased asset, regardless of
whether ownership is ultimately transferred. Operating leases refer to leases other
than finance leases. When the company acts as a sublease lessor, it classifies the
sublease based on the right-to-use assets arising from the original lease.
①Accounting for operating leases
Lease receipts under operating leases are recognized as rental income on a straight-
line basis over each period of the lease term. The Company capitalizes the initial
direct costs incurred in connection with operating leases and apportions them to
current profit or loss over the lease term on the same basis as rental income is
recognized. Variable lease payments that are not included in the lease receipts are
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
recognized in current profit or loss when they are actually incurred. If a change in
an operating lease occurs, the Company accounts for it as a new lease from the
effective date of the change, and the amount of lease payments received in advance
or receivable in connection with the lease before the change is regarded as the
amount of payments received under the new lease.
②Accounting for finance leases
On the commencement date of the lease, the Company recognizes finance lease
receivables for finance leases and derecognizes finance lease assets. When the
Company makes initial measurement of the finance lease receivable, the net lease
investment is used as the recorded value of the finance lease receivable. The net
lease investment is the sum of the unguaranteed residual value and the present
value of the lease receipts not yet received at the commencement date of the lease
term discounted at the interest rate embedded in the lease.
The Company calculates and recognizes interest income for each period of the
lease term based on a fixed periodic interest rate. Derecognition and impairment of
finance lease receivables are accounted for in accordance with Note III.9 "Financial
Instruments" of this note.Variable lease payments that are not included in the net
lease investment measurement are recognized in profit or loss when they are
actually incurred.
If a change in a finance lease occurs and the following conditions are met, the
Company accounts for the change as a separate lease:
- the change expands the scope of the lease by adding the right to use one or more
leased assets;
- the increased consideration is equivalent to the separate price of the expanded
portion of the lease adjusted for the circumstances of that contract.
If a change in a finance lease is not accounted for as a separate lease, the Company
treats the changed lease separately in the following circumstances:
- If the change becomes effective on the lease commencement date and the lease
would be classified as an operating lease, the Company accounts for it as a new
lease from the effective date of the lease change and uses the net investment in the
lease prior to the effective date of the lease change as the carrying amount of the
leased asset;
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
- If the change becomes effective on the lease commencement date and the lease is
classified as a finance lease, the Company accounts for the lease in accordance
with the policy on modification or renegotiation of contracts as described in Note
III.9 Financial Instruments.
Items Materiality Criteria
Significant debt investments Amount≥CNY 50,000,000.00
The Company identifies subsidiaries whose
Significant non-wholly owned total revenue exceeds 50% of the total group
subsidiaries profits as significant non-wholly owned
subsidiaries
(42)Changes in significant accounting policies
Accounting Treatment for Standard Warehouse Receipt Transactions under the
Financial Instruments Standards Implementation Q&A
On July 8, 2025, the Ministry of Finance issued the Implementation Q&A
regarding the accounting treatment for standard warehouse receipt transactions. It
explicitly states that, in accordance with the Accounting Standards for Financial
Instruments (Recognition and Measurement), enterprises engaging in frequent
contracts to buy and sell standard warehouse receipts on futures exchanges for the
purpose of generating profits from price differentials, without taking physical
delivery of the underlying commodities, typically indicate a business practice of
acquiring contract assets and subsequently reselling them within a short period to
profit from short-term market fluctuations. Such contracts shall be treated as
financial instruments, and their accounting treatment shall follow the requirements
of the financial instruments standards.
When enterprises acquire standard warehouse receipts under such contracts and sell
them within a short period, sales revenue shall not be recognized. Instead, the
difference between the consideration received and the carrying amount of the sold
standard warehouse receipts shall be recognized in investment income. Standard
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
warehouse receipts held at the reporting period and not yet sold shall be classified
as other current assets.
Pursuant to the requirements of the Notice on Strictly Implementing Enterprise
Accounting Standards and Effectively Preparing Enterprise Annual Reports for
implementation of the above provisions shall require restatement of comparable
period information in the financial statements. The adoption of this regulation has
not had a material impact on the Company ’ s financial position or operating
results.
(43)Changes in significant accounting estimates
There were no changes in the Company's significant accounting estimates during
the reporting period.
IV.Taxation
Tax
Tax Tax base
rate
The output tax is calculated on the basis 0%、
of the income from the sale of goods and 1%、
taxable services calculated in accordance 5%、
Value-added tax (VAT) with the provisions of the tax law, and 6%、
after deducting the input tax allowed to be 9%、
deducted in the current period, the 11%、
difference is the value-added tax payable 13%
City construction tax 7% 、
Payable turnover tax, tax exemption
Educational surcharge Payable turnover tax, tax exemption 3%
Local education surcharge Payable turnover tax, tax exemption 2%
Enterprise income tax Taxable profits
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
EIT rate for different taxpayer
Tax principles EIT rate
TsannKuen (Zhangzhou) Enterprise Co., Ltd. (hereafter, TKL) 15%
TsannKuen China (Shanghai) Enterprise Co., Ltd. (hereafter, TKS) 25%
Xiamen TsannKuen Property Service Co., Ltd. (hereafter, TKW) 20%
Pt.Star Comgistic Indonesia 22%
（ 1 ） According to the principle of “ The Second Batch of High-tech Enterprise Filing
List of Fujian Province's Accreditation Organisations for 2023 Accreditation Reporting”,
TKL was identified as Fujian Province High-tech Enterprise, and the certification was
valid for 3 years (Certification No. GR202335003031), in accordance with the Enterprise
Income Tax Law of the People's Republic of China, the Implementation Regulations of
the Enterprise Income Tax Law of the People's Republic of China and other relevant
provisions, the income tax rate of Tsann Kuen (Zhangzhou) Enterprise Co., Ltd. enjoys a
（ 2 ） According to the provisions of the Announcement on Further Supporting the
Development of Small and Micro Enterprises and Self-Employed Individuals with Tax
and Fee Policies (Announcement No. 12 of 2023 by the Ministry of Finance and the State
Administration of Taxation):"3. The policy allowing small and micro-profit enterprises to
calculate taxable income at 25% of the statutory rate and pay enterprise income tax at a
Services Co., Ltd., a subsidiary of the Company, is entitled to the above tax preferential
policies."
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
V.Notes to Consolidated Financial Statements
Items Closing balance Opening balance
Monetary Funds 814,719.21 887,987.84
Digital Currency
Cash in bank 460,016,679.73 440,872,233.11
Other cash and cash equivalents 16,377.06 2,617,722.57
Deposits with Financial
Companies
Total 460,847,776.00 444,377,943.52
Including：The total amount
deposited overseas
Restricted Funds Held
Overseas
CNY 16,377.06 is the balance of the company's Alipay account. In addition, there are no
funds other than the deposit for letter of credit in the monetary funds at the end of the
period that have restrictions on use and potential recovery risks due to mortgages, pledges
or freezes.
Closing Opening
Items
balance balance
Financial asset measured at fair value through
P&L
Including：Equity instrument investment
Structured Deposit Investment 50,942,083.33
Total 50,942,083.33
(1)Category of accounts receivable listed by age
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Aging Closing Balance Opening balance
Within1 year 142,623,608.17 205,640,866.11
Including：Within 90 days 126,361,373.98 190,204,917.49
Over 5 years 15,740.52 5,000.00
Subtotal 142,649,774.48 205,786,324.43
Less：provision for bad
debt
Total 139,969,323.13 203,955,899.80
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(2)Category of accounts receivable
Closing Balance Opening Balance
Provision
Items Booking balance Booking balance Provision
Booking value Booking value
Amount % Amount % Amount % Amount %
Accounts
receivabl
e with
individua
l bad
debt
provision
Accounts
receivabl
e with
bad debt
provision
based on
the
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing Balance Opening Balance
Provision
Items Booking balance Booking balance Provision
Booking value Booking value
Amount % Amount % Amount % Amount %
character
s of
credit
risk
portfolio
Including
:
-Portfolio 139,200,837.1 2,680,451.3 1.9 136,520,385.8 204,835,409.8 1,830,424.6 0.8 203,004,985.1
by age 8 5 3 3 1 3 9 8
-Portfolio
by
related
parties
Total
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Provision for Bad Debts Based on Aging Portfolio：
Closing Balance
Aging Accounts Provision for bad
Proportion (%)
receivable debts
Not overdue 120,294,774.42 601,159.83 0.50
Overdue 1 -
Overdue 31 -
Overdue 61 -
Overdue more
than 90 days
Total 139,200,837.18 2,680,451.35
(3)Provision for bad debts charged off, reversed or recovered during the period
Change during the year
Opening
Category Collect/carry Written- Closing Balance
balance Accrued others
over off
Accounts receivable
with individual bad
debt provision
Accounts receivable
with bad debt provision
based on the characters
of credit risk portfolio
Including:Portfolio by
age
Portfolio by related
parties
Total 1,830,424.63 2,680,451.35 4,510,875.98
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(4)Accounts receivable written off in current period
There Were No Actual Write-Offs of Accounts Receivable in the Current Period.
(5)Top five of closing balances of customers
The aggregated amount of the top five accounts receivable and contract assets
based on the balance owed by each debtor at the end of the period is CNY
receivable and contract assets. The corresponding aggregate bad debt provision at
the end of the period for these amounts is CNY 2,350,723.71.
(1)Advances to suppliers by aging
Closing Balance Opening Balance
Items Percentage Percentage
Amoun Amoun
(%) (%)
Within 1 year 4,955,253.01 100.00 4,318,758.91 100.00
Total 4,955,253.01 100.00 4,318,758.91 100.00
(2)Top five of closing balances of suppliers
The total amount of the top five suppliers with the largest prepaid amounts at the
end of the year is CNY 1,903,219.05, accounting for 38.41% of the total amount of
the prepayment at the end of the year.
Items Closing Balance Opening Balance
Interest receivable
Dividend receivable
Other receivable 21,608,192.98 27,902,480.51
Total 21,608,192.98 27,902,480.51
(1)Other receivables
①Disclosure by aging
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Aging Closing Balance Closing Balance
Within 1 year (including 1year) 20,499,731.51 26,709,851.91
Including: Within 90 days 20,311,115.49 26,401,440.21
Over 5 years 1,026,725.63 1,048,404.94
Subtotal 22,088,251.57 28,418,971.13
Less: provision for bad debt 480,058.59 516,490.62
Total 21,608,192.98 27,902,480.51
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
②Categories of other receivable
Closing Balance Opening Balance
Items Book balance Provision Carrying Booking balance Provision Carrying
Amount % Amount % amount Amount % Amount % amount
Provision
for bad
debts is
made on 326,422.64 1.48 326,422.64 1.15
an
individua
l basis
Including
:
Other
current 326,422.64 1.48 326,422.64 1.15
balances
Provision
for bad 21,761,828.9 153,635.9 21,608,192.9 28,092,548.4 190,067.9 27,902,480.5
debts by 3 5 8 9 8 1
portfolio
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing Balance Opening Balance
Items Book balance Provision Carrying Booking balance Provision Carrying
Amount % Amount % amount Amount % Amount % amount
Including
:
Export
tax 54.33 63.34
refund
Other
current 8,634,103.30 39.09 1.78 8,480,467.35 8,887,143.55 31.27 2.14 8,697,075.57
balances
Deposit 1,127,725.63 5.11 1,127,725.63 1,205,404.94 4.24 1,205,404.94
Total
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Provision for bad debts is made on an individual basis:
Closing Balance Opening Balance
Accru
Items Booking Bad al Reason for Booking
bad debts
balance debts rate(% accrual balance
)
The
financial
Guangdo situation of
ng the trading
Songqing partner has
Intelligen 326,422. 326,422. 100.0 deteriorated 326,422. 326,422.
t 64 64 0 and the 64 64
Technolo amount is
gy Co., expected to
Ltd be
unrecovera
ble
Total
Provision for Bad Debts Based on Portfolio:
Closing Balance
Items
Other receivables Bad debts Accrual rate(%）
Other current
balances
Total 8,634,103.30 153,635.95
③Bad debt provision of other receivable
Provision for bad 1st stage 2nd stage 3rd stage Total
debt 151
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Expected Expected Expected
credit loss credit loss credit loss
within within life within life
following 12 time time
months (unimpaired) (impaired)
Balance on January
On January 1, 2024
Other receivable
carrying amount on
the book
transfer to 2nd stage
transfer to 3rd stage
reverse to 2nd stage
reverse to 1st stage
Accrued 141,983.73 141,983.73
Reversed 178,415.76 178,415.76
Recollected
Written off
Others
Closing Balance 153,635.95 326,422.64 480,058.59
④Provision for bad debts charged off, reversed or recovered during the period
Change during the year
Opening Closing
Items Collected/revers Writte other
balance Accrued Balance
ed n-off s
Other
current 190,067. 141,983. 153,635.
balanc 98 73 95
es
Total 190,067. 141,983. 178,415.76 153,635.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Change during the year
Opening Closing
Items Collected/revers Writte other
balance Accrued Balance
ed n-off s
⑤The categories of other receivable by nature
Items Closing Balance Opening balance
Export tax refund 12,000,000.00 18,000,000.00
Other current balances 8,960,525.95 9,213,566.19
Deposit 1,127,725.63 1,205,404.94
Total 22,088,251.58 28,418,971.13
⑥Other receivables from the top 5 debtors
Rate of
closing Bad
Company name Category Againg other
balance debts
receivables
Zhangzhou
Taiwan
Export
investment zone 1-90
tax 12,000,000.00 54.33
State days
refund
Administration
of Taxation
State Grid Fujian Other
Longhai Power current 2,824,073.65 12.79
days
Supply Co., Ltd balances
China Export &
Credit Insurance Security over
Corporation deposit 5years
Fujian Branch
Sunshine Other 437,550.00 1-90 1.98
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Rate of
closing Bad
Company name Category Againg other
balance debts
receivables
Property current days
Insurance Co., balances
Ltd., Xiamen
Branch
PT. PLN Security over
(PERSERO) deposit 5years
Total 16,288,349.28 73.75
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(1)Inventories by category
Closing Balance Closing Balance
Provision for Provision for
decline in decline in
value of value of
inventories / inventories /
Items Net book
Book value provision for Net book value Book value provision for
value
impairment impairment of
of contract contract
performance performance
costs costs
Raw materials 74,015,782.16 59,069,321.14 13,095,705.30 61,465,027.98
Materials in transit 7,796,782.08 - 7,796,782.08 - 3,073,604.45
Self-manufactured semi- 27,333,598.
finished goods 54
Work in process 31,803,251.23 - 31,803,251.23 - 29,574,402.53
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing Balance Closing Balance
Provision for Provision for
decline in decline in
value of value of
inventories / inventories /
Items Net book
Book value provision for Net book value Book value provision for
value
impairment impairment of
of contract contract
performance performance
costs costs
Finished goods 69,675,139.12 5,282,134.24 64,393,004.88 6,285,683.77 72,401,473.53
Low-value consumables 16,016,038.78 - 16,016,038.78 - 3,745,185.65
Total 215,823,595.28 193,718,061.45 22,575,157.97
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(2)Provision for impairment
Increase Decrease
Items Opening Balance Reverse/Written Closing Balance
Accrual other other
-off
Raw materials 13,095,705.30 3,143,935.72 -109,391.73 1,183,788.27 - 14,946,461.02
Self-manufactured semi-
finished goods
Finished goods 6,285,683.77 3,378,000.10 -9,556.14 4,371,993.49 - 5,282,134.24
Total 22,575,157.97 7,236,217.75 -130,876.22 7,574,965.67 22,105,533.83
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Closing balance Opening balance
Debt investments due within one
year
Total 555,877,899.74 51,260,694.44
Items Closing balance Opening balance
Financial investment 279,745,858.28 544,439,535.72
Reclassification of VAT debit
balances, etc.
Total 288,286,038.04 554,336,979.01
(1)Situation of debt investment
Closing balance Opening balance
Provision Provision
Items
Book balance for Carrying amount Book balance for Carrying amount
impairment impairment
Large
certificate of 736,100,000.00 736,100,000.00 581,500,000.00 581,500,000.00
deposit
Interest
Accrual for
Large 28,380,048.42 28,380,048.42 10,295,355.13 10,295,355.13
certificate of
deposit
Subtotal 764,480,048.42 764,480,048.42 591,795,355.13 591,795,355.13
Less: Debt
investments
due within
one year
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing balance Opening balance
Provision Provision
Items
Book balance for Carrying amount Book balance for Carrying amount
impairment impairment
Total 208,602,148.68 208,602,148.68 540,534,660.69 540,534,660.69
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(2)Significant debt investments at the end of the period
Closing balance Opening balance
Items Coupon Actual Maturity Principal Coupon Actual Maturity Principal
Face Value Face Value
Rate Rate Date Due Rate Rate Date Due
Quanzhou
Bank Time
Deposit
Certificate
Xiamen Bank
Large
Certificates of
Deposit
Xiamen Bank
Large
Certificates of
Deposit
Xiamen
International 50,000,000.00 2.85% 2.85% 2026/4/9
Bank Time
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing balance Opening balance
Items Coupon Actual Maturity Principal Coupon Actual Maturity Principal
Face Value Face Value
Rate Rate Date Due Rate Rate Date Due
Deposit
Certificate
Chiyu Bank
Time Deposit 50,000,000.00 2.85% 2.85% 2026/5/11
Certificate
Xiamen
International
Bank Time 50,000,000.00 2.75% 2.75% 2026/5/23
Deposit
Certificate
Quanzhou
Bank Time
Deposit
Certificate
Quanzhou
Bank Time 50,000,000.00 2.85% 2.85% 2026/7/4
Deposit
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing balance Opening balance
Items Coupon Actual Maturity Principal Coupon Actual Maturity Principal
Face Value Face Value
Rate Rate Date Due Rate Rate Date Due
Certificate
Quanzhou
Bank Time
Deposit
Certificate
Quanzhou
Bank Time
Deposit
Certificate
Quanzhou
Bank Time
Deposit
Certificate
Quanzhou
Bank Time
Deposit
Certificate
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing balance Opening balance
Items Coupon Actual Maturity Principal Coupon Actual Maturity Principal
Face Value Face Value
Rate Rate Date Due Rate Rate Date Due
Xiamen Bank
Large
Certificates of
Deposit
Quanzhou
Bank Time
Deposit
Certificate
Quanzhou
Bank Time
Deposit
Certificate
Total 204,600,000.00 531,500,000.00
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Changes in the current period
Opening Opening Investment Closing
Adjustment of Changes Declaration of Closing
balance(Ca balance of gains or losses Accrual of balance of
Invested entity Follow-on Reduce other in other issuing cash balance(Carr
rrying depreciatio recognized impairment Other depreciatio
investment investment comprehensive rights and dividends or ying amount)
amount) n reserves under equity provision n reserves
income interests profits
method
Associate
Company
Shanghai Upa
Smart Chain
Home 9,800,000.00 -1,713,478.49 -201,582.69 7,884,938.82
Appliances
Co., Ltd.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Closing balance Opening balance
Non-trading investments in equity
instruments
Total 40,000.00 40,000.00
(1)Investment property measured as cost method
Building and Land use
Items Total
plants rights
（1）Opening Balance 80,814,358.80 29,260,577.51 110,074,936.31
（2） Increase 39,000.00 39,000.00
—Purchase 39,000.00 39,000.00
—Transferred from
fixed assets
（3）Decrease
—Disposal
（4）Closing Balance 80,853,358.80 29,260,577.51 110,113,936.31
Depreciation
（1）Opening Balance 72,758,196.24 18,028,984.84 90,787,181.08
（2）Opening Balance 144,524.76 622,111.80 766,636.56
—Accrued 144,524.76 622,111.80 766,636.56
—Transfer from fixed
assets
（3）Decrease
—Disposal
（4）Closing Balance 72,902,721.00 18,651,096.64 91,553,817.64
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Building and Land use
Items Total
plants rights
（1）Opening Balance
（2） Increase
—Accrued
（3）Decrease
—Decrease
（4）Closing Balance
（1）Closing book value 7,950,637.80 10,609,480.87 18,560,118.67
（2）Opening book value 8,056,162.56 11,231,592.67 19,287,755.23
(2)Investment properties without certificate of title
Item Carrying amount Reason
Lvyuan three country
villa
Total 742,403.57
Note: Lvyuan three country villa is the houses with limited property rights
purchased by the TsannKuen China (Shanghai) Enterprise Co., Ltd. which is the
subsidiary of the Company from Shanghai Lvsheng Real State Development Co.,
Ltd. in 1999. In January 2006, Shanghai Lvsheng Real State Development Co., Ltd.
and Shanghai Jiading district, Huangdu town Lvyuan community residents'
committees issued the certificate jointly to prove the right of this property belongs
to TsannKuen China (Shanghai) Enterprise Co., Ltd.
(1)Fixed assets and fixed assets liquidation
Items Closing balance Opening balance
Fixed assets 162,861,863.08 146,795,190.83
Disposal of fixed assets
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Closing balance Opening balance
Total 162,861,863.08 146,795,190.83
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(2)Fixed assets detail
Improvement
Houses and Electronic devices,
Items Machinery Vehicles expense of leased Total
buildings modules and others
fixed assets
（1）Opening
Balance
（2）Increase 3,762,005.54 21,079,322.79 23,735,476.41 1,352,877.09 805,430.92 50,735,112.75
—Purchase 288,755.29 11,889,687.37 20,851,515.12 1,084,735.52 805,430.92 34,920,124.22
—Transferred
from construction- in- 3,473,250.25 9,189,635.42 2,883,961.29 268,141.57 15,814,988.53
progress
—Impact of
changes in exchange
rates
（3）Decrease 1,134,427.87 7,071,340.63 1,897,975.50 115,394.07 234,017.67 10,453,155.74
—Disposal 5,994,708.96 794,598.00 2,861.50 6,792,168.46
—Transfer out
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Improvement
Houses and Electronic devices,
Items Machinery Vehicles expense of leased Total
buildings modules and others
fixed assets
to investment property
—Impact of
changes in exchange 1,134,427.87 1,076,631.67 1,103,377.50 112,532.57 234,017.67 3,660,987.28
rates
（4）Closing Balance 92,438,400.88 168,651,335.71 871,337,673.44 17,682,380.02 21,333,812.52 1,171,443,602.57
Depreciation
（1）Opening
Balance
（2）Increase 3,195,990.73 10,069,529.47 19,014,925.94 350,726.54 301,314.07 32,932,486.75
—Accrued 3,195,990.73 10,069,529.47 19,014,925.94 350,726.54 301,314.07 32,932,486.75
—Impact of
changes in exchange
rates
（3）Decrease 534,339.53 5,157,408.59 1,345,398.52 97,583.03 182,860.70 7,317,590.37
—Disposal 4,581,616.61 575,728.28 2,344.66 5,159,689.55
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Improvement
Houses and Electronic devices,
Items Machinery Vehicles expense of leased Total
buildings modules and others
fixed assets
—Transfer out
to investment property
—Impact of
changes in exchange 534,339.53 575,791.98 769,670.24 95,238.37 182,860.70 2,157,900.82
rates
（4）Closing Balance 58,835,000.66 94,243,384.21 795,303,025.69 15,677,608.13 19,081,116.44 983,140,135.13
Reserve
（1） Opening
Balance
（2） Increase 130,586.68 47,471.57 178,058.25
—Accrued 130,586.68 47,471.57 178,058.25
—Impact of
changes in exchange
rates
（3）Decrease 1,479,092.95 97,682.04 645.70 249.18 1,577,669.87
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Improvement
Houses and Electronic devices,
Items Machinery Vehicles expense of leased Total
buildings modules and others
fixed assets
—Disposal 1,413,092.35 46,646.04 516.84 1,460,255.23
—Impact of
changes in exchange 66,000.60 51,036.00 128.86 249.18 117,414.64
rates
（4）Closing Balance 5,623,229.07 19,799,548.53 7,854.22 10,972.54 25,441,604.36
（1）Closing book
value
（2）Opening book
value
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(3)Temporary idle fixed assets
Provision
Accumulated Carrying Not
Item Initial cost for
depreciation amount e
impairment
Electronic
device
Improvemen
t expense of
leased fixed
assets
Machinery
euipment
Machinery 1,854,341.6 680,916.3
euipment 9 9
Total
(4)Fixed assets as pending certificate of ownership
Carrying amount on
Item Reason
Telecommunications
project expenses
Houses and buildings
renovation expenses
(1)Construction in progress and construction materials
Items Closing balance Opening balance
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Provision for Carrying Provision for Carrying
Book balance Book balance
impairment amount impairment amount
Construction in
progress
Engineering
materials
Total 14,770,911.87 14,770,911.87 3,462,300.89 3,462,300.89
(2)Construction in progress details
Closing balance Opening balance
Provision
Items Provision for Carrying Carrying
Book balance Book balance for
impairment amount amount
impairment
Sporadic
project
Equipment to
be inspected
Total 14,770,911.87 14,770,911.87 3,462,300.89 3,462,300.89
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Houses and
Items Total
buildings
（ 1） Opening Balance 408,735,436.56 408,735,436.56
（2）Increase 1,374,156.36 1,374,156.36
—New Leases 1,374,156.36 1,374,156.36
（3）Decrease
—Transferred to Fixed Assets
—Disposal
（ 4） Closing Balance 410,109,592.92 410,109,592.92
（ 1） Opening Balance 54,791,566.64 54,791,566.64
（2）Increase 14,930,816.06 14,930,816.06
—Accrued 14,930,816.06 14,930,816.06
（3）Accrued
—Transferred to Fixed Assets
—Disposal
（ 4） Closing Balance 69,722,382.70 69,722,382.70
（ 1） Opening Balance
（2）Increase
—Accrued
（3）Decrease
—Transferred to Fixed Assets
—Disposal
（ 4） Closing Balance
（1）Closing book value 340,387,210.22 340,387,210.22
（2）Opening book value 353,943,869.92 353,943,869.92
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Land use rights Software Total
（1）Opening balance 19,423,602.68 53,847,562.20 73,271,164.88
（2）Increase 61,495.51 27,477.88 88,973.39
—Purchase 27,477.88 27,477.88
—Impact of changes in exchange rates 61,495.51 61,495.51
（3） Decrease 707,100.09 707,100.09
—Disposal
—Impact of changes in exchange rates 707,100.09 707,100.09
（4） Closing balance 18,777,998.10 53,875,040.08 72,653,038.18
（1）Opening balance 7,589,198.59 53,734,647.63 61,323,846.22
（2）Increase 645,020.94 122,073.85 767,094.79
—Accrual 645,020.94 122,073.85 767,094.79
—Impact of changes in exchange rates
（3） Decrease 243,995.00 243,995.00
—Disposal
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Land use rights Software Total
—Impact of changes in exchange rates 243,995.00 243,995.00
（4） Closing balance 7,990,224.53 53,856,721.48 61,846,946.01
（1）Opening balance
（2）Increase
—Accrual
（3） Decrease
—Disposal
（4） Closing balance
（1） Closing Book value 10,787,773.57 18,318.60 10,806,092.17
（2）Opening Book value 11,834,404.09 112,914.57 11,947,318.66
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Other
Closing Amortizati Opening
Items Increase Decrea
balance on balance
se
Building
improvement
expenses
Telecommunicati
ons project 84,199.14 37,487.88 46,711.26
expenses
Total
(1)Deferred tax assets before offsetting
Closing balance Opening balance
Deductible Deductible
Items Deferred tax Deferred tax
temporary temporary
assets assets
differences differences
Deductible
losses
Provision
for asset
impairmen
t
Provision
for credit
impairmen
t
Unrealized
intragroup
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing balance Opening balance
Deductible Deductible
Items Deferred tax Deferred tax
temporary temporary
assets assets
differences differences
profit
Accrued
expenses
Lease 402,036,188.9 60,305,428.3 396,776,679.4 59,538,736.8
liabilities 4 4 2 2
Total
(2)Deferred tax liabilities before offsetting
Closing balance Opening balance
Deductible Deductible
Items Deferred tax Deferred tax
temporary temporary
liabilities liabilities
differences differences
Financial
assets held 942,083.33 141,312.50
for trading
Depreciatio
n of fixed
assets
accelerates
Right-of- 340,387,210.2 51,058,081.5 353,943,869.9 53,091,580.4
use Assets 2 3 2 9
合计
(3)Deferred tax assets or liabilities on a net basis after elimination
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing balance Opening balance
Offset Offset
Amount Amount
Items Between Balance after Between Balance after
Deferred Tax offsetting Deferred Tax offsetting
Assets and Assets and
Liabilities Liabilities
Deferred tax
assets
Deferred tax
liabilities
(4)Unrecognized deferred tax assets
Items Closing balance Opening balance
Provision for asset impairment 10,949,534.40 12,501,998.30
Provision for credit impairment 845,781.10 259,531.91
Accrued expenses 7,502,466.81 16,484,156.08
Payroll liability 4,674,110.43 2,119,054.60
Undistributed deficit 33,440,943.64 24,592,204.05
Total 57,412,836.38 55,956,944.94
(5)Deductible losses not recognised as deferred tax assets will expire in the
following periods
Year Closing balance Opening balance Memo
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Year Closing balance Opening balance Memo
Total 33,440,943.64 24,592,204.05
Closing balance Opening balance
Provisio Provisio
Items Book n for Carrying Book n for Carrying
balance impairm amount balance impairm amount
ent ent
Prepaid
mold
fee and
equipm
ent fee
Total
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing balance Opening balance
Items
Book Balance Book Value Restricted assets Book Balance Book Value Restricted assets
Monetary Letter of credit
funds margin
Total 2,487,216.02 2,487,216.02
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Classification Closing balance Opening balance
Bank acceptance notes 2,224,816.88 19,418,627.35
Total 2,224,816.88 19,418,627.35
Items Closing balance Opening balance
Within 1 year 380,458,300.99 513,873,164.01
Over 1 year 3,410,092.35 3,448,353.28
Total 383,868,393.34 517,321,517.29
Items Closing balance Opening balance
Within 1 year 2,250,671.08 2,803,884.45
Over 1 year 131,374.50 120,448.80
Total 2,382,045.58 2,924,333.25
Items Closing balance Opening balance
Advance from merchandise 23,384,580.98 15,988,527.98
Advance for Management Fees 233,082.20 308,211.67
Total 23,617,663.18 16,296,739.65
(1)Details of employee benefits payable
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Impact
Increase Decrease of
Opening during the during the changes Closing
Items
balance reporting reporting in balance
period period exchang
e rate
Short- -
term 104,169.
.15 .43 .86 .73
benefits 99
Post-
employm
ent
benefits 24,133,339. 24,134,544.
– 41 74
Defined
contributi
on plan
Terminati
on 412,762.55
benefits
Total 104,180.
.40 .39 .15 .45
(2)Details of short-term employee benefits
Decrease during Impact of
Increase during the
Items Opening balance the reporting changes in Closing balance
reporting period
period exchange rate
（1）Wages or
salaries, bonuses,
allowances and
subsidies
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Decrease during Impact of
Increase during the
Items Opening balance the reporting changes in Closing balance
reporting period
period exchange rate
（2）Staff welfare 16,177,008.48 16,177,008.48
（3）Social
security 4,662.77 12,665,588.72 12,667,190.31 -20.35 3,040.83
contributions
Include: Medical
insurance
Work injury
insurance
Maternity
insurance
（4） Housing
funds
（5）Labor union
and employee 855,623.03 855,623.03
education costs
（6） Short-term
paid leave
Total 53,950,714.15 292,297,404.43 289,887,426.86 -104,169.99 56,256,521.73
(3)Details of defined contribution plans
Impact
Increase Decrease of
Openin
during the during the changes Closing
Items g
reporting reporting in balance
balance
period period exchang
e rate
Basic pension 6,122.5 23,376,350.8 23,377,519.6 4,943.5
-10.20
insurance 4 1 1 4
Unemploymen 185.71 756,988.60 757,025.13 149.18
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Impact
Increase Decrease of
Openin
during the during the changes Closing
Items g
reporting reporting in balance
balance
period period exchang
e rate
t insurance
Total -10.20
Items Closing balance Opening balance
Value-added tax 467,002.43 952,185.68
Enterprise income tax 3,642,909.01 13,505,915.29
Individual income tax 562,112.35 809,831.82
City maintenance and
construction tax
Education surcharge 189,000.00 360,765.73
local education surcharge 126,000.00 240,510.49
Real estate tax 1,428,496.70 1,456,280.69
Land use tax 175,232.82 175,232.78
Stamp duty 157,324.77 202,995.02
Other 4,242.05 5,401.04
Total 7,067,320.13 18,310,394.76
Items Closing balance Opening balance
Interest payable
Dividend payable
Other payables 28,579,322.67 40,877,557.33
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Closing balance Opening balance
Total 28,579,322.67 40,877,557.33
(1)Other accounts payable
①Other payables categorized by payments nature
Items Closing balance Opening balance
Bid security deposits 7,983,586.79 8,735,043.85
Current payments and others 5,351,553.34 7,474,779.27
Accrued expenses 15,244,182.54 24,667,734.21
Total 28,579,322.67 40,877,557.33
②Material Other Payables with Aging Over One Year or Overdue
Items Closing balance Reason for Unrepaid or Unsettled
Bid security To be returned upon contract
deposits termination
Items Closing balance Opening balance
Lease liabilities due within one
year
Total 476,624.15 922,678.70
Items Closing balance Opening balance
Lease payments 687,431,273.71 698,687,752.67
Less：unrecognized financing
charges
Less：Lease liabilities due within 476,624.15 922,678.70
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Closing balance Opening balance
one year
Total 401,559,564.79 396,004,620.97
Change forcurrent period
New
Capitalizat
Opening shar Share Closing
Items ion of Othe Subto
Balance es donati balance
capital rs tal
issu on
reserve
ed
Numb
er of 185,391,68 185,391,68
total 0.00 0.00
shares
Increase in Decrease in
Opening Closing
Items the current the current
Balance balance
period period
Capital
premium (share 210,045,659.80 210,045,659.80
premium)
Other capital
reserves
Total 296,808,965.79 296,808,965.79
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Current year
Less: Less:
previously previously
recognized in recognized in After tax After tax
Opening Amount for other other Less: attributable attributable Closing
Items
Balance the year comprehensiv comprehensiv Income tax to the to minority balance
before tax e income e income expense parent shareholder
transferred transferred company s
into profit or into retained
loss earnings
comprehensive
income that
will not be
reclassified to
profit or loss
Including：
Remeasuremen 41,036.56 41,036.56
t gains or
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Current year
Less: Less:
previously previously
recognized in recognized in After tax After tax
Opening Amount for other other Less: attributable attributable Closing
Items
Balance the year comprehensiv comprehensiv Income tax to the to minority balance
before tax e income e income expense parent shareholder
transferred transferred company s
into profit or into retained
loss earnings
losses of a
defined benefit
plan
Other
comprehensive
income using
the equity
method that
will not be
reclassified to
profit or loss
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Current year
Less: Less:
previously previously
recognized in recognized in After tax After tax
Opening Amount for other other Less: attributable attributable Closing
Items
Balance the year comprehensiv comprehensiv Income tax to the to minority balance
before tax e income e income expense parent shareholder
transferred transferred company s
into profit or into retained
loss earnings
Changes in
fair value of
other equity
instrument
investments
Changes in
fair value of
enterprise's
own credit risk
comprehensive 6 3,954,027.0 2,965,520.2 988,506.7 1
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Current year
Less: Less:
previously previously
recognized in recognized in After tax After tax
Opening Amount for other other Less: attributable attributable Closing
Items
Balance the year comprehensiv comprehensiv Income tax to the to minority balance
before tax e income e income expense parent shareholder
transferred transferred company s
into profit or into retained
loss earnings
income to be 0 5 5
reclassified to
profit or loss
Including：
Under equity
method,
proportionate
share of other
comprehensive
income
invested
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Current year
Less: Less:
previously previously
recognized in recognized in After tax After tax
Opening Amount for other other Less: attributable attributable Closing
Items
Balance the year comprehensiv comprehensiv Income tax to the to minority balance
before tax e income e income expense parent shareholder
transferred transferred company s
into profit or into retained
loss earnings
company
FV change of
other debt
investment
Financial
instrument
reclassified
into other
comprehensive
income
Credit
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Current year
Less: Less:
previously previously
recognized in recognized in After tax After tax
Opening Amount for other other Less: attributable attributable Closing
Items
Balance the year comprehensiv comprehensiv Income tax to the to minority balance
before tax e income e income expense parent shareholder
transferred transferred company s
into profit or into retained
loss earnings
impairment
provision of
other debt
investment
Cash flow
hedges
effective
portion
Foreign - - -
currency 3,954,027.0 2,965,520.2 988,506.7
translation 0 5 5
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Current year
Less: Less:
previously previously
recognized in recognized in After tax After tax
Opening Amount for other other Less: attributable attributable Closing
Items
Balance the year comprehensiv comprehensiv Income tax to the to minority balance
before tax e income e income expense parent shareholder
transferred transferred company s
into profit or into retained
loss earnings
difference
- - -
Total 3,954,027.0 2,965,520.2 988,506.7
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Increase in Decrease in
Opening Closing
Items the current the current
Balance balance
period period
Statutory
surplus reserve
Total 81,427,732.56 5,352,894.75 86,780,627.31
Items Current year Prior year
Closing balance of prior year 527,518,517.81 507,010,039.53
Adjustments for the opening balance
(increase /(decrease))
Balance at the beginning of the
reporting period after adjustments
Add: net profit attributable to owners
of the parent company for the 23,545,319.37 72,782,642.48
reporting period
Less: Provision for statutory surplus
reserves
Provision for any surplus reservesC
Provision of general risk
Dividends payable for common shares 33,370,502.40 46,347,920.00
Share dividends
Closing balance of current year 512,340,440.03 527,518,517.81
(1)Operating income and cost
Current year Prior year
Items
Revenue Costs of sales Revenue Costs of sales
Principa
l
operatin
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Current year Prior year
Items
Revenue Costs of sales Revenue Costs of sales
g
activitie
s
Others 46,880,902.92 11,856,078.57 52,954,088.34 13,956,531.45
Total
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(2)Revenue from principal activities (by industry or business)
Industry Current year Prior year
(business
Revenue Costs of sales Revenue Costs of sales
)
Househo
ld
applianc
es
industry
Total
(3)Revenue from principal activities (by product)
Current year Prior year
Product
Revenue Costs of sales Revenue Costs of sales
Catering
and
Cooking
Home 369,884,920.6 330,792,146.0 450,085,933.7 397,179,916.9
helper 5 3 0 7
Tea/Coff
ee 86,053,300.56 75,142,750.98
makers
Other 7,462,762.58 3,943,852.29 14,667,794.07 7,600,860.42
Total
(4)Revenue from principal activities (by region)
Region Current year Prior year
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Revenue Costs of sales Revenue Costs of sales
Australi
a
Africa 2,953,785.89 2,792,390.70 15,758,618.31 12,986,861.43
Americ 595,844,245.7 541,878,569.8 847,408,182.1 744,335,500.9
a 5 0 1 1
Europe
Asia
Total
Items Current year Prior year
City construction tax 2,131,395.21 2,673,626.01
Education surcharge 1,224,129.01 1,560,402.93
Local Education surcharge 817,043.13 1,040,268.65
Property tax 2,988,346.37 2,953,530.94
Property tax 398,846.80 398,846.80
Stamp duty 687,684.95 905,265.36
Others 62,222.21 43,315.39
Total 8,309,667.68 9,575,256.08
Items Current year Prior year
Employee benefit 14,069,531.81 16,454,435.95
Advertisements charges and
sales promotion
Sales commission and after 42,945.64 6,028,629.94
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Current year Prior year
sales service fees
Travel expenses 620,068.05 1,110,026.40
Administrative expenses 152,129.82 128,595.30
Leasing 21,842.16 22,718.34
Claims experiment expenses 960,771.13 1,401,804.99
Travel expense 4,310,620.71 4,207,806.76
Total 22,681,766.27 32,229,714.35
Items Current year Prior year
Employee benefit 47,908,724.21 42,423,111.23
Depreciation and amortization
of assets
Employee benefit 3,391,599.30 2,975,629.69
Consultant fees 2,440,849.27 2,122,571.44
Maintenance expenses 3,801,226.60 3,745,323.37
Insurance expenses 1,947,554.90 2,402,559.65
Administrative expenses 1,707,776.06 1,676,235.64
Rental expenses 184,983.65 306,785.03
Other expense 7,289,400.16 5,686,296.38
Total 76,651,233.17 71,475,902.71
Items Current year Prior year
Employee remunerations 44,742,516.32 47,317,568.07
Depreciation and amortization
of assets
Test expenses 6,274,061.42 6,578,389.27
Maintenance expenses 2,094,668.66 1,837,472.13
Certification expenses 1,810,373.01 1,539,557.35
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Current year Prior year
Patent expenses 903,881.82 705,579.71
Travel expenses 575,609.06 551,259.50
Consultant fees 342,498.96 256,246.64
Rental expenses 38,287.43 40,310.01
Others 1,969,793.25 2,278,083.81
Total 61,494,511.72 64,932,266.81
Items Current year Prior year
Interest expenses 21,174,939.96 21,700,670.25
Including: interest expense on
lease liabilities
Less: Interest income 6,644,317.40 9,148,448.06
Foreign exchange losses -1,583,059.60 -11,924,910.07
Add: Others expenditure 708,051.38 760,380.35
Total 13,655,614.34 1,387,692.47
Items Current year Prior year
Government grant 7,683,398.57 2,373,328.56
Withholding of personal
income tax handling fee
Total 7,797,792.60 2,474,270.98
Items Current year Prior year
Income from long-term equity investments
-1,713,478.49
accounted for using the equity method
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Current year Prior year
Investment income earned during the
holding period of a trading financial asset
Investment income from the disposal of
-33,700.00 321,250.00
trading financial assets
Other current assets’ investment and
wealth management
Total 29,022,384.02 37,678,574.75
Sources of gains on changes in fair value Current year Prior year
Tradable financial asset -942,083.33 -2,066,950.01
Including: Changes in fair value of
-432,800.00
derivatives
Financial products -942,083.33 -1,634,150.01
Total -942,083.33 -2,066,950.01
Items Current year Prior year
Bad debt of accounts
receivables
Bad debt of other receivables -36,432.03 52,587.96
Total 828,311.85 -1,247,974.06
Items Current year Prior year
Inventory impairment loss &
Impairment loss on contract 3,464,673.48 6,812,241.66
performance costs
Fixed asset impairment loss 177,933.89 2,358,907.09
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Current year Prior year
Total 3,642,607.37 9,171,148.75
Amount included in
non-recurring profit or
Items Current year Prior year
loss in the current
period
Income from the
disposal of fixed 756,104.15
assets
Total 756,104.15
Amount
included in non-
Items Current year Prior year recurring profit
or loss in the
current period
Other 2,062,990.74 488,343.55 2,062,990.74
Total 2,062,990.74 488,343.55 2,062,990.74
Amount
included in
non-recurring
Items Current year Prior year
profit or loss in
the current
period
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Amount
included in
non-recurring
Items Current year Prior year
profit or loss in
the current
period
Donations 61,242.81
Loss from damage or
scrapping of non-current 4,472.80 4,472.80
assets
Penalty and late payment 116,848.25 25,750.00 116,848.25
others
Total 121,321.05 86,992.81 121,321.05
(1)Income tax expenses
Items Current year Prior year
Current income tax expenses 6,305,118.13 17,927,037.97
Deferred income tax expenses -3,969,783.70 -3,487,994.18
Total 2,335,334.43 14,439,043.79
(2)Reconciliation of income tax expenses to the accounting profit
Items Current year
Total profit 30,684,065.16
Income tax expense at the statutory [or applicable] tax
rate
Effect of different tax rates applied to subsidiaries -1,444,080.93
Effect of adjustments to income taxes of prior periods 928,579.71
Impact of non-taxable income 287,259.18
Effect of non-deductible costs, expenses and losses 981,015.41
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Current year
Effect of non-deductible costs, expenses and losses -2,561,168.09
Effect of deductible temporary differences or deductible
losses on deferred income tax assets not recognized in 3,023,683.03
the period
R&D expenses plus deduction -6,550,970.17
Income tax expense 2,335,334.43
(1)Basic earnings per share
Basic earnings per share is calculated by dividing consolidated net income
attributable to ordinary shareholders of the company by the weighted average
number of ordinary shares of the Company in issue:
Item Current year Prior year
Consolidated net income attributable to
ordinary shareholders of the parent
Weighted average number of common
shares of the Company issued and 185,391,680.00 185,391,680.00
outstanding
Basic earnings per share 0.13 0.39
Include: Basic earnings per share from
continuing operations
Basic earnings per share from
discontinued operations
(2)Diluted earnings per share
Diluted earnings per share is calculated by dividing the consolidated net income
attributable to ordinary shareholders of the company (diluted) by the weighted
average number of ordinary shares of the Company in issue (diluted):
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Item Current year Prior year
Consolidated net income attributable to
ordinary shareholders of the parent 23,545,319.37 72,782,642.48
(diluted)
Weighted average number of common
shares of the Company issued and 185,391,680.00 185,391,680.00
outstanding (diluted)
Diluted earnings per share 0.13 0.39
Include: Diluted earnings per share
from continuing operations
Diluted earnings per share from
discontinued operations
(1)Cash relating to operating activities
①Cash received relating to other operating activities
Item Current year Prior year
Government grants 7,683,398.57 2,373,328.56
Interest income 6,644,317.43 9,148,448.06
Rent income 40,130,936.58 35,225,301.36
Funds in current account and others 68,382,204.93 58,998,534.03
Total 122,840,857.51 105,745,612.01
②Other cash payments relating to operating activities
Item Current year Prior year
Penalties and donations 116,848.25 86,992.81
Bank charges 708,051.41 760,380.35
Sales expenses, general and
administrative expenses, and
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Item Current year Prior year
research and development expenses
paid by cash
Current accounts and others 68,683,022.87 60,758,272.65
Total 122,836,112.72 96,116,367.69
(2)Cash relating to investing activities
①Cash received relating to other investing activities
Item Current year Prior year
A term deposit deposited with a
financial institution to earn interest 635,349,329.98 546,076,871.65
income at maturity
Total 635,349,329.98 546,076,871.65
②Cash paid relating to other investing activities
Item Current year Prior year
A term deposit deposited with a
financial institution for earning 325,728,783.59 699,587,632.10
interest income
Total 325,728,783.59 699,587,632.10
(3)Cash relating to financing activities
①Cash receipts relating to other financing activities
Item Current year Prior year
Letter of credit margin 4,748,170.39 11,360,910.42
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Item Current year Prior year
Total 4,748,170.39 11,360,910.42
②Cash payments relating to other financing activities
Item Current year Prior year
Lease payments of right-of-use
assets
Letter of credit deposit 2,260,954.37 8,495,821.20
Total 15,555,306.89 21,446,503.68
(1)Supplementary information to the cash flow statement
additional materials Current year Prior year
operating
Net profit 28,348,730.73 96,091,690.28
Add: Impairment loss of credit 828,311.85 -1,247,974.06
Provision for impairment losses of
assets
Depreciation of fixed assets,
Investments properties
Depreciation of right-of-use assets 14,930,816.06 14,620,121.76
Amortisation of intangible assets 755,060.01 1,651,783.01
Amortisation of Long-term prepaid
expenses
Gain on disposal of fixed assets,
intangible assets, and other long-term -756,104.15
assets (Gain expressed with “-”)
Loss on scrapping of fixed assets (Gain
expressed with “-”)
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
additional materials Current year Prior year
Loss on changes in fair value (Gain
expressed with “-”)
Financial expense (Income expressed
with “-”)
Investment loss (Income expressed with
-29,022,384.02 -37,678,574.75
“-”)
Decreases in deferred tax assets
-3,969,783.70 -3,487,994.18
(Increase expressed with “-”)
Increases in deferred tax liabilities
(Decrease expressed with “-”)
Decrease in inventories (Increase
expressed with “-”)
Decrease in operating receivables
(Increase expressed with “-”)
Increases in operating payables -
(Decrease expressed with “-”) 148,232,929.07
Others
Net cash flows from operating activities -14,987,121.90 136,383,412.09
equivalents
Cash at the end of the reporting period 460,847,776.00 441,890,727.50
Less: Cash at the beginning of the
reporting period
Add: Cash equivalents at the end of the
reporting period
Less: Cash equivalents at the beginning of
the reporting period
Net increase in cash and cash equivalents 18,957,048.50
(2)Composition of cash and cash equivalents
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Item Current year Prior year
Including: Cash on hand 814,719.21 887,987.84
Digital Currency
Bank deposits 460,016,679.73 440,872,233.11
Other monetary funds 16,377.06 130,506.55
Deposits with the central bank
Deposits with other banks
Placements with banks
Including: Investments in debt securities
due within three months
equivalents
Including: Restricted cash and cash
equivalents of the Company and
subsidiaries within the Group
Monetary Funds Not Belonging to Cash and Cash Equivalents:
Item Closing balance Opening balance Reasons
Letter of credit Not withdrawable
margin at any time
Total 2,487,216.02
(1)Foreign currency monetary items
Converted
Closing balance
Items Closing balance exchange
converted CNY
rate
Money funds 130,186,633.20
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Converted
Closing balance
Items Closing balance exchange
converted CNY
rate
Include：USD 17,351,446.60 7.03 121,959,847.86
Euro 26,368.20 8.24 217,155.31
HKD 208,447.78 0.90 188,274.20
JPY 144,238,105.42 0.04 6,461,434.41
HUF 81,016.00 0.02 1,728.80
IDR 3,075,782,176.71 1,291,828.51
GBP 7,034.12 9.43 66,364.11
Accounts receivables 137,352,795.82
Include：USD 19,116,456.38 7.03 134,365,528.63
IDR 639,959,400.00 269,887.53
JPY 60,659,858.00 0.04 2,717,379.66
Accounts payables 43,825,342.58
Include：USD 5,794,801.72 7.03 40,730,502.33
Euro 66,306.00 8.24 546,063.06
JPY 1,666,084.47 0.04 74,635.59
IDR 5,887,596,790.50 2,472,790.65
HKD 1,495.70 0.90 1,350.95
Other receivables 1,036,138.74
Include：USD 8,089.73 7.03 56,861.09
IDR 2,331,613,442.00 979,277.65
HKD
Other payables 2,897,152.27
Include：USD 316,548.47 7.03 2,224,955.89
HKD 73,851.42 0.90 66,704.08
IDR 1,358,227,347.52 570,455.49
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Converted
Closing balance
Items Closing balance exchange
converted CNY
rate
JPY 782,124.00 0.04 35,036.81
(2)Description of foreign operations: for significant foreign operations, major
domicile and functional currency and its basis of selection shall be disclosed,
and reasons for foreign operations changing their functional currencies shall
also be disclosed.
Name of the overseas operating entity: Pt.Star Comgistic Indonesia
Main business area: Indonesia
Accounting standard currency: US dollars
(1)The Company as the lessee
Items Current year Prior year
Interest Expense on Lease Liabilities 16,441,826.74 16,253,615.68
Short-term Lease Expenses
Recognized in Related Asset Costs or
Simplified as Current Period Gains
and Losses
Income from Subleasing Right-of-Use
Assets
Total Cash Outflows Related to
Leases
The future potential cash outflows not included in the lease liability measurement
mainly arise from leases committed to by the lessee but not yet commenced.
The expected future cash outflows for leases committed to but not yet commenced
are as follows：
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Unamortized Lease
Remaining Lease Term
Payment Amount
Within 1 Year 12,460,484.07
Over 3 Years 637,436,715.87
Total 687,431,273.72
(2)The company shall be the lessor
Operation lease
Current year Prior year
Operating Lease Income 17,151.696.10 18,876,240.86
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
VI.R&D expenditures (Research and Development)
Current year Prior year
Research and Research and
Items Development Development
Development Total Development Total
expenditures expenditures
Expenses Expenses
Employee
remunerations
Depreciation
and
amortization of
assets
Test expenses 6,274,061.42 6,274,061.42 6,578,389.27 6,578,389.27
Maintenance
expenses
Certification
expenses
Patent
expenses
Travel
expenses
Consultant fees 342,498.96 342,498.96 256,246.64 256,246.64
Rental
expenses
Others 1,969,793.25 1,969,793.25 2,278,083.81 2,278,083.81
Total 61,494,511.72 61,494,511.72 64,932,266.81 64,932,266.81
VII.Changes in the scope of consolidation
The company did not experience any changes in the scope of consolidation during the
current period.
In October 2025, the Company established an indirect subsidiary, Xiamen Yipengxin
Trading Co., Ltd., with a registered capital of RMB 2,000,000. As of December 31, 2025,
no capital contribution had been made to the subsidiary, and it had not commenced
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
operations. Therefore, it was not included in the consolidation scope.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
VIII.Interest in other entity
(1)Organization structure of group company
Shareholding
Principal Place of
Registered (%)
Name of Subsidiary place of Registrati Business Nature Acquisition method
capital Indire
business on Direct
ct
Manufactures
Tsann Kuen (Zhangzhou) 160 million US Zhangzho Acquired through
Zhangzhou home electronic 75.00
Enterprise Co., Ltd. dollars u establishment
appliance
Acquired through
Tsann Kuen China Manufactures
(Shanghai) Enterprise Shanghai Shanghai home electronic
dollars 5 combination under
Co., Ltd. appliance
common control
Xiamen Tsannkuen
Property Acquired through
Property Services Co., 1.5 million CNY Xiamen Xiamen 100.00
services establishment
Ltd.
Acquired through
East Sino Development 412.39 million Hong Investment,
Hong Kong 75.00 business
Limited HKD Kong Trading
combination under
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Shareholding
Principal Place of
Registered (%)
Name of Subsidiary place of Registrati Business Nature Acquisition method
capital Indire
business on Direct
ct
common control
Acquired through
Manufactures
Pt.StarComgistic 53 million US business
Indonesia Indonesia home electronic 75.00
Indonesia dollars combination under
appliance
common control
Pt.Star Comgistic
Property Development Indonesia Indonesia 75.00
dollars development establishment
Indonesia
Orient Star Investments 185,000 US Hong Investment, Acquired through
Hong Kong 75.00
Limited dollars Kong Trading business
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(2)Significant non-wholly owned subsidiaries
Dividends
Profit or loss
declared to
attributable Non-
Shareholdin distribute to
to non- controlling
g ratio of non-
Name of controlling interests at the
non- controlling
subsidiary interests end of the
controlling interests
during the reporting
interests during the
reporting period
reporting
period
period
Tsann Kuen
(Zhangzhou) 6,451,173.1 13,446,820.9 333,654,327.0
Enterprise Co., 6 0 7
Ltd.
Pt.StarComgisti
c Indonesia
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(3)Main financial information of significant non-wholly owned subsidiaries
Closing balance Opening balance
Name of
Non-current Current Non-current Non-current Current Non-current
subsidiary Current assets Total assets Total liabilities Current assets Total assets Total liabilities
assets liabilities liabilities assets liabilities liabilities
Tsann Kuen
(Zhangzhou)
Enterprise Co.,
Ltd.
Pt.StarComgistic
Indonesia
Current year Prior year
Total Net cash Net cash
Name of Total
Net comprehen flows from Net flows from
subsidiary Revenue Revenue comprehensi
profit/(loss) sive operating profit/(loss) operating
ve income
income activities activities
Tsann Kuen 1,199,152,943. 25,804,692. 25,804,692 9,790,353.5 1,596,844,4 59,763,648 59,763,648. 170,908,401
(Zhangzhou) 42 63 .63 5 36.87 .46 46 .59
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Current year Prior year
Total Net cash Net cash
Name of Total
Net comprehen flows from Net flows from
subsidiary Revenue Revenue comprehensi
profit/(loss) sive operating profit/(loss) operating
ve income
income activities activities
Enterprise Co.,
Ltd.
- - - - -
Pt.StarComgistic 116,123,437 16,832,872.
Indonesia .72 96
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(4)Aggregated Financial Information of Non-material Joint Ventures and Associate
Companies
Closing Opening
balance/Current year balance/Prior year
Associate Company：
Total Carrying Amount of
Investments
Total Amounts Adjusted Based on
Equity Interest
—Net Profit -1,285,108.87
—Other Comprehensive Income
—Total Comprehensive Income -1,285,108.87
IX.Government Grants
Item in P&L statement Current year Prior year
asset-related government
grants
revenue-related government
grants
Total 7,683,398.57 2,373,328.56
No refunds of government grants occurred during the current period.
X.Risk Related to Financial Instruments
The company faces various financial risks during its operations, including credit
risk, liquidity risk, and market risk (including foreign exchange risk, interest rate
risk, and other price risks). The following describes these financial risks and the
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
risk management policies adopted by the company to mitigate them:
The Board of Directors is responsible for planning and establishing the company's
risk management framework, formulating risk management policies and related
guidelines, and overseeing the implementation of risk management measures. The
company has established risk management policies to identify and analyze the risks
it faces. These policies provide clear regulations for specific risks, covering aspects
such as market risk, credit risk, and liquidity risk management. The company
regularly assesses changes in the market environment and its business activities to
determine whether updates to its risk management policies and systems are
necessary. Risk management is conducted by the Risk Management Committee
according to policies approved by the Board of Directors. The Risk Management
Committee collaborates closely with other business departments to identify,
evaluate, and mitigate relevant risks. The company ’ s internal audit department
conducts regular reviews of risk management controls and procedures and reports
the results to the Audit Committee.
The company diversifies financial instrument risks through appropriate investment
and business portfolio strategies and reduces concentration risks associated with
single industries, specific regions, or particular counterparties by implementing
corresponding risk management policies.
(1)Credit Risk
Credit risk refers to the risk of financial loss arising from a counterparty's failure to
fulfill its contractual obligations.
The main sources of credit risk for the company include cash and bank balances,
notes receivable, accounts receivable, receivables financing, contract assets, other
receivables, debt investments, other debt investments, and financial guarantee
contracts, as well as debt instruments measured at fair value through profit or loss
and derivative financial assets that are not subject to impairment assessment. As of
the balance sheet date, the carrying amount of the company's financial assets
represents its maximum exposure to credit risk.
The company's cash and bank balances are primarily held with state-owned banks
and other large and medium-sized listed banks with high credit ratings. The
company believes there is no significant credit risk, and it is unlikely that major
losses will arise from bank defaults.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
For notes receivable, accounts receivable, receivables financing, contract assets,
and other receivables, the company has established policies to control credit risk
exposure. The company assesses the creditworthiness of customers based on their
financial condition, the possibility of obtaining guarantees from third parties, credit
history, and other factors such as current market conditions, and sets appropriate
credit terms accordingly. The company monitors customer credit records regularly.
For customers with poor credit records, the company may take actions such as
written reminders, shortening credit periods, or canceling credit periods to ensure
that its overall credit risk remains within a manageable range.
(2)Liquidity Risk
Liquidity risk refers to the risk of a shortage of funds when a company needs to
settle obligations denominated in cash or other financial assets.
The company's policy is to maintain sufficient cash to repay maturing debts.
Liquidity risk is centrally controlled by the finance department. The finance
department monitors cash balances, readily marketable securities, and rolling
forecasts of cash flows for the next 12 months to ensure that the company has
adequate funds to meet its debt obligations under all reasonable scenarios.
Additionally, the company continuously monitors compliance with loan
agreements and secures commitments from major financial institutions to provide
sufficient standby funding to meet both short-term and long-term capital
requirements.
(3)Market Risk
Market risk refers to the risk that the fair value or future cash flows of financial
instruments will fluctuate due to changes in market prices, including foreign
exchange risk, interest rate risk, and other price risks.
①Interest Rate Risk
Interest rate risk refers to the risk that the fair value or future cash flows of
financial instruments will fluctuate due to changes in market interest rates.
Fixed-rate and floating-rate interest-bearing financial instruments expose the
company to fair value interest rate risk and cash flow interest rate risk, respectively.
The company determines the proportion of fixed-rate versus floating-rate
instruments based on market conditions and maintains an appropriate mix of fixed
and floating rate instruments through regular reviews and monitoring. When
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
necessary, the company uses interest rate swaps to hedge interest rate risks.
②Foreign Exchange Risk
Foreign exchange risk refers to the risk that the fair value or future cash flows of
financial instruments will fluctuate due to changes in foreign exchange rates.
The company continuously monitors foreign currency transactions and the scale of
foreign currency assets and liabilities to minimize its exposure to foreign exchange
risks. Additionally, the company may enter into forward foreign exchange contracts
or currency swap contracts to hedge against foreign exchange risks. During the
current and previous periods, the company did not enter into any forward foreign
exchange contracts or currency swap contracts.
The company's exposure to foreign exchange risk mainly arises from financial
assets and liabilities denominated in US dollars. The amounts of foreign currency
financial assets and liabilities converted into CNY are listed below:
Items Closing balance Opening balance
Cash and cash equivalent 130,186,633.20 112,054,855.83
Accounts receivable 137,352,795.82 203,496,159.10
Other receivables 1,036,138.74 609,593.63
Accounts payable 43,825,342.58 46,143,775.01
Other payables 2,897,152.27 1,274,139.73
Total 315,298,062.61 363,578,523.30
XI.Fair value disclosures
The inputs used in fair value measurements are divided into three levels:
Level 1 inputs are unadjusted quoted prices in active markets for identical assets or
liabilities that are available at the measurement date.
Level 2 inputs are inputs other than Level 1 inputs that are directly or indirectly
observable for the related asset or liability.
Level 3 inputs are unobservable inputs for the relevant asset or liability.
The level to which the fair value measurement results belong is determined by the lowest
level to which the inputs that are significant to the fair value measurement as a whole
belong.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
F V at the year end
Items 1st Level FV 3rd Level FV
FV Total
Measurement Measurement
Measurement
◆Other equity
instrument 40,000.00 40,000.00
investment
Total assets
measured at fair
value on an
ongoing basis
Recurring or Nonrecurring Basis
The fair value measurement of derivative financial assets is based on the valuation
provided by the bank for the outstanding forward foreign exchange on the balance sheet
date; The fair value of debt instrument investment is measured on the basis of the
principal of the structural deposit that is not due on the balance sheet date and the interest
rate agreed with the bank.
XII.Related Parties Relationship and Transactions
Voting
Shareholdi
power
Parent Registered Business Registered ng
percenta
company address nature capital percentage
ge
（%）
（%）
STAR Manufactu
NTD
COMGIST Taiwan(Chi res and
IC na) sales
.00
CAPITAL electrical
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Voting
Shareholdi
power
Parent Registered Business Registered ng
percenta
company address nature capital percentage
ge
（%）
（%）
CO., LTD. equipment
Note: The ultimate controlling party of the Company is STAR COMGISTIC CAPITAL
CO., LTD.
For details of the Company's subsidiaries, please refer to "VIII. Interests in other entities"
in this note.
Name of related party Related party relationship
Shanghai Upa Smart Chain Home Associates of the Company's
Appliances Co., Ltd. Subsidiaries
Name of related party Related party relationship
The company is directly
controlled by the key
Thermaster Electronic (Xiamen) Ltd.
management and closed family
members
Tsann Kuen Enterprise Co., Ltd. Same actual controller
Tsann Kuen (Japan) Electric Co., Ltd. Same actual controller
(1)Purchases or sales of goods, rendering or receiving of services
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Purchases of goods, receiving of services:
Nature of the
Related parties Current year Prior year
transaction(s)
Thermaster Electronic Purchase of
(XIAMEN) Limited goods
Thermaster Electronic Accept labor
(XIAMEN) Limited service
STAR COMGISTIC Quality claim
CAPITAL CO., LTD. payment
Tsann Kuen (Japan) Accept labor
Electric Co., Ltd. service
Sales of goods/provide labour services
Nature of the
Related parties Current year Prior year
transaction(s)
STAR COMGISTIC CAPITAL Sales of
CO., LTD. goods
Shanghai Upa Smart Chain Sales of
Home Appliances Co., Ltd. goods
Note: Shanghai Upa Smart Chain Home Appliances Co., Ltd. is an associate
company in which the Company's subsidiary, Tsann Kuen (Zhangzhou) Enterprise
Co., Ltd., holds an equity interest.
(2)Management remuneration
Unit: Ten thousand yuan
Items Current year Prior year
Management remuneration 355.24 422.85
(1)Receivables
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing balance Opening balance
Items Related party Book Book
Provision Provision
balance balance
Shanghai
Upa Smart
Accounts
Chain Home 2,837,533.62
receivable
Appliances
Co., Ltd.
STAR
COMGISTIC
CAPITAL
CO., LTD.
Note: Shanghai Upa Smart Chain Home Appliances Co., Ltd. is an associate
company in which the Company's subsidiary, Tsann Kuen (Zhangzhou) Enterprise
Co., Ltd., holds an equity interest.
(2)Payables
Items Related party Closing Balance Opening balance
Thermaster
Accounts payable Electronic (Xiamen) 5,975,170.05 6,936,867.52
Ltd.
XIII.Commitments and contingencies
As of December 31, 2025, the company has issued but not yet fulfilled irrevocable letters
of credit amounting to CNY 59,795,039.28 and USD 5,275,505.28.
As of December 31, 2025, the outstanding balance of guarantees provided by Tsann Kuen
(Zhangzhou) Enterprise Co., Ltd. as a joint liability guarantor for its subsidiary PT. Star
Comgistic Indonesia amounted to USD 721,008.00.
Apart from the above, there are no other significant commitments that the company is
required to disclose.
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
As of 31st December 2025, The Company has no significant contingencies need to be
disclosed.
XIV.Events after the Balance Sheet Date
The company has no significant non-adjusting events.
On 7 March 2026, the first Board Meeting of 2026 held by the Company reviewed and
approved the profit distribution plan for 2025. Based on the total share capital of
distributed to all shareholders of the Company (tax included). The profit for distribution
of the Company is CNY 18,539,168.00 The proposal still needs to be approved by the
shareholders' general meeting of the Company.
XV.Notes to the Main Items of Company’s Financial Statements
(1)Accounts receivable with the bad debt provisions under accounting aging
analysis method
Aging Closing Balance Opening balance
Within1 year 4,480.88 117,163.04
Including：Within 90 days 4,480.88 102,845.83
Over 5 years 15,740.52 5,000.00
Subtotal 30,006.79 262,621.36
Less：provision for bad debt 25,635.62 60,840.92
Total 4,371.17 201,780.44
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
(2)Category of accounts receivable
Closing Balance Opening Balance
Provision
Items Booking balance Booking Booking balance Provision Booking
value value
Amount % Amount % Amount % Amount %
Accounts
receivable with
individual bad
debt provision
Accounts
receivable with
bad debt
provision
based on the
characters of
credit risk
portfolio
Including:
-Portfolio by 27,963.91 100.00 25,635.62 23.17 2,328.29 262,621.36 98.24 60,840.92 2.11 201,780.44
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing Balance Opening Balance
Provision
Items Booking balance Booking Booking balance Provision Booking
value value
Amount % Amount % Amount % Amount %
age
-Portfolio by
related parties
Total 30,006.79 100.00 25,635.62 4,371.17 262,621.36 100.00 60,840.92 201,780.44
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Provision for Bad Debts Based on Aging Portfolio：
Closing Balance
Aging Accounts Provision for bad
Proportion (%)
receivable debts
Not overdue
Overdue 1 - 30
days
Overdue 31 -
Overdue 61 -
Overdue more
than 90 days
Total 27,963.91 25,635.62
(3)Provision for bad debts charged off, reversed or recovered during the period
Change during the year
Opening Closing
Category Collect/car Writte other
balance Accrued Balance
ry over n-off s
Accounts
receivable with
individual bad
debt provision
Accounts
receivable with
bad debt -
provision based 35,205.3
on the 0
characters of
credit risk
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Change during the year
Opening Closing
Category Collect/car Writte other
balance Accrued Balance
ry over n-off s
portfolio
Including:Portfo 60,840.9 25,635.6
lio by age 2 2
Portfolio by
related parties
Total 35,205.3
(4)Top five of closing balances of customers
The aggregated amount of the top five accounts receivable and contract assets
based on the balance owed by each debtor at the end of the period is CNY
receivable and contract assets. The corresponding aggregate bad debt provision at
the end of the period for these amounts is CNY 25,635.62.
Items Closing Balance Opening Balance
Interest receivable
Dividend receivable
Other receivable 5,020,385.44 6,555,310.24
Total 5,020,385.44 6,555,310.24
(1)Other receivables
①Disclosure by aging
Aging Closing Balance Closing Balance
Within 1 year 4,933,605.68 6,472,526.44
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Aging Closing Balance Closing Balance
Including: 1 – 90 days 4,888,067.24 6,435,216.14
Subtotal 5,107,941.34 6,618,526.44
Less: provision for bad debt 87,555.90 63,216.20
Total 5,020,385.44 6,555,310.24
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
②Categories of other receivable
Closing Balance Opening Balance
Items Book balance Provision Booking Booking balance Provision Booking
Amount % Amount % value Amount % Amount % value
Provision for
bad debts is
made on an
individual
basis
Provision for
bad debts by 5,107,941.34 100.00 87,555.90 1.71 5,020,385.44 6,618,526.44 100.00 63,216.20 0.96 6,555,310.24
portfolio
Including:
refund
current 3,391,221.61 66.39 87,555.90 2.58 3,303,665.71 3,036,610.37 45.88 63,216.20 2.08 2,973,394.17
balances
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Closing Balance Opening Balance
Items Book balance Provision Booking Booking balance Provision Booking
Amount % Amount % value Amount % Amount % value
related parties
Total 5,107,941.34 100.00 87,555.90 5,020,385.44 6,618,526.44 100.00 63,216.20 6,555,310.24
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Provision for Bad Debts Based on Portfolio:
Closing Balance
Items
Other receivables Bad debts Accrual rate(%）
Other current
balances
Total 3,391,221.61 87,555.90
③Bad debt provision of other receivable
Expected Expected Expected
Provision for bad credit loss credit loss credit loss
Total
debt within within life within life
following 12 time time
months (unimpaired) (impaired)
Balance on January
On January 1,
receivable carrying
amount on the
book
transfer to 2nd
stage
transfer to 3rd
stage
reverse to 2nd
stage
reverse to 1st stage
Accrued 141,983.73 141,983.73
Reversed 117,644.03 117,644.03
Recollected
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Expected Expected Expected
Provision for bad credit loss credit loss credit loss
Total
debt within within life within life
following 12 time time
months (unimpaired) (impaired)
Written off
Others
Closing Balance 87,555.90 87,555.90
④Provision for bad debts charged off, reversed or recovered during the period
Openin Change during the year
Closing
Items g Collected/reverse Written other
Accrued Balance
balance d -off s
Other
current 87,555.9 87,555.9
balance 0 0
s
Total
⑤The categories of other receivable by nature
Items Closing Balance Opening balance
Other current balances 3,391,221.61 3,036,610.37
Deposit 101,000.00 87,000.00
Total 3,492,221.61 3,123,610.37
⑥The top significant other receivable categorized by debtors
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Rate of other
Company name Category closing balance Againg receivables Bad debts
（%）
TsannKuen (Zhangzhou) Related Within
Enterprise Co., Ltd.(TKL) party 90 days
Accounts Within 2
XIAO GUANG LIU 109,806.20 2.15
Receivable years
JD Self-operated Flagship Accounts Within
Store Receivable 180 days
State Grid Fujian Electric
Accounts Within
Power Co., Ltd. Xiamen 89,164.87 1.75
Receivable 90 days
Power Supply Company
Xiamen Lurenjia Sports Accounts Within
Culture Co., Ltd. Receivable 90 days
Total 1,990,179.10 38.97
Closing balance Opening balance
Provision Provision
Items Carrying Carrying
Book balance for Book balance for
amount amount
impairment impairment
Subsidiaries 923,414,701.56 923,414,701.56 923,414,701.56 923,414,701.56
Total 923,414,701.56 923,414,701.56 923,414,701.56 923,414,701.56
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Investments in subsidiaries
Increase in Decrease in Impairment Reserve
Balance at the End of Impairment Reserve Balance at Balance at the End of Impairment Provision for
Investee Company Current Current Balance at the End of
Last Year the End of Last Year Current Period Current Period
Period Period Current Period
TsannKuen (Zhangzhou) Enterprise
Co., Ltd. (TKL)
Xiamen Tsannkuen Property Services
Co., Ltd. (TKW)
Total 923,414,701.56 923,414,701.56
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Current year Prior year
Items
Revenue Costs of sales Revenue Costs of sales
Principal
operating 1,878,640.77 1,433,292.81 2,160,490.71 1,371,709.94
activities
Others 63,155,206.16 38,800,465.07 60,416,530.32 36,827,096.77
Total 65,033,846.93 40,233,757.88 62,577,021.03 38,198,806.71
Items Current year Prior year
Investment income from long-term equity
investments under cost method
Total 40,989,673.41 50,748,305.69
XVI.Supplementary Information
Items Amounts Instruction
Gains and losses on disposal of non-current assets,
including the offsetting portion of the provision for
asset impairment already made
Government grants recognized in profit or loss for
the current period,except for government grants
that are closely related to the Company's normal
business operations, in compliance with national 7,797,792.60
policies and in accordance with defined criteria,
and that have a sustainable impact on the
Company's profit or loss
In addition to the effective hedging business -1,401,348.54
Tsann Kuen (China) Enterprise Co., Ltd.
Notes to the Financial Statements
For the Year Ended December 31, 2025
(English Translation for Reference Only)
Items Amounts Instruction
related to the normal operation of the company, the
fair value change gains and losses arising from the
holding of financial assets and financial liabilities
by non-financial enterprises and the gains and
losses arising from the disposal of financial assets
and financial liabilities
Other profit or loss items that meet the definition of
non-recurring profit or loss
Subtotal 8,338,113.75
Income tax effect 1,264,519.35
Minority interests impact amount (after tax) 1,720,848.00
Total 5,352,746.40
Weighted Earnings per share (EPS)
average return
Profit of report period
on net assets Basic EPS Diluted EPS
(%)
Net profit attributable to shareholders
of parent company
Net profit after deducting non-
recurring gains and losses
attributable to shareholders of parent
company
Tsann Kuen (China) Enterprise Co., Ltd.
