ITEQ : 2022Q2 Consolidated Results

Stock No.: 6213

ITEQ Corporation and Subsidiaries

Consolidated Financial Statements

and Independent Auditors' Review Report

For the Six Months Ended June 30, 2022 and 2021

Address: No. 17, Daluge Rd., Xinpu Township, Hsinchu County 305,

Taiwan (R.O.C.)

Tel: [phone]

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§Table of Contents§

				Financial Report
		Items	Page	No. of Notes
I.	Cover Page	1	-
II.	Table of Contents	2	-
III.	Independent Auditors' Review Report	3~4	-
IV.	Consolidated Balance Sheets	5	-
V.	Consolidated Statements of Comprehensive	6~7	-
	Income
VI.	Consolidated Statements of Changes Equity	8	-
VII.	Consolidated Statements of Cash Flows	9~10	-
VIII. Note to consolidated financial statements
	(I)	Company history	11	1
	(II)	Authorization of Financial	11	2
		Statements
	(III)	Application of New and Revised	11~13	3
		International Financial Reporting
		Standards
	(IV)	Summary of Significant Accounting	13~15	4
		Policies
	(V)	Critical Accounting Judgments and	15	5
		Key Sources of Estimation and
		Uncertainty
	(VI)	Summary of Significant Accounting	15~45	6~27
		Items
	(VII)	Related Party Transactions	45~46	28
	(VIII)	Pledged Assets	-	-
	(IX)	Significant Contingent Liabilities	47	29
		and Unrecognized Commitments
	(X)	Significant assets and liabilities	47	30
		denominated in foreign currencies
	(XI)	Other Matters	47	31
	(XII)	Separately disclosed Items
	1. Information about significant	48, 51~57,	32
		transactions	59~60
	2. Information about investees	48, 51~57,	32
			59~60
	3. Information on investments in	48~49, 51~52	32
		Mainland China	55~56, 58~60
	4. Information on major shareholders	49, 61	32
	(XIII)	Segments Information	49~51	33

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Independent Auditors' Review Report

The Board of Directors and Shareholders ITEQ Corporation:

Introduction

We have reviewed the accompanying consolidated financial statements of ITEQ Corporation and its subsidiaries (hereinafter collectively referred to as the "Group") as of June 30, 2022 and 2021, and the related consolidated statements of comprehensive income, of changes in equity and cash flows for the period for three months and six months ended June 30, 2022 and 2021, and the related notes to the consolidated financial statements, including a summary of significant accounting policies. Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulation Governing the Presentation of Financial Reports by Securities Issuers and International Accounting Standard 34 "Interim Financial Reporting" endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China. Our responsibility is to express a conclusion on the consolidated financial statements based on our reviews.

Scope of Review

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

Basis for Qualified Conclusion

As disclosed in Note 4 and 11 to the consolidated financial statements, the financial statements of some non-significant subsidiaries included in the consolidated financial statements and investments using the equity method referred to in the first paragraph were not reviewed. As of June 30, 2022 and 2021, the combined total assets of these non-significant subsidiaries were NT$1,359,815 thousand and NT$1,182,116 thousand, respectively both representing 4% and 4% of the consolidated total assets, and the combined total liabilities of non-significant subsidiaries were NT$1,175,080 thousand and NT$1,357,555 thousand respectively both representing 9% and 8% of the consolidated total liabilities, the amounts of combined comprehensive income of these subsidiaries were NT$(4,847) thousand, NT$25,547 thousand, and (2,592) thousand that representing (3%), 3%, (0.2%) and 3% of the consolidated total comprehensive income for the three months ended June 30 ,2022 and 2021,and for the six months ended June 30 , 2022 and 2021, respectively. The carrying amount of the investment using the equity method as at June 30, 2022 was NT$49,000 thousand; and the share of profit or loss of joint ventures recognized using the equity method for the three months and six months ended June 30, 2022 and 2021 were NT$0.

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Qualified Conclusion

Except for the adjustments, if any, as might have been determined to be necessary had the financial statements of non-significant subsidiaries and investments using the equity method as described in the preceding paragraph been reviewed, based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the group as of June 30, 2022 and 2021, and of its the consolidated financial performance for the three months ended June 30, 2022 and 2021, and its consolidated financial performance and its consolidated cash flows for the six months then ended June 30, 2022 and 2021 in accordance with the Regulations Governing the Preparation of Financial Position by Securities Issuers and IASs 34, "Interim Financial Reporting" endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Deloitte & Touche
CPA Chen-Hsiu, Yang	CPA Kuan-Hao, Li
The Financial Supervisory Commission	The Financial Supervisory Commission
R.O.C. Approved No.	R.O.C. Approved No.
Jing Guang Zheng Shen No.	Jing Guang Zheng Shen No. 1100372936
0980032818

August 2, 2022

Notice to Readers

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

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

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ITEQ Corporation and Subsidiaries

Consolidated Balance Sheets

June 30, 2022, December 31, 2021, and June 30, 2021

																				Unit: NTD thousand
				June 30, 2022							December 31, 2021				June 30, 2021
				(Reviewed)							(Audited)							(Reviewed)
Code	Asset			Amount		%					Amount		%					Amount		%
	CURRENT ASSETS
1100	Cash and cash equivalents (Note 6)	$	3,872,897			12		$	4,423,278			12		$	2,749,465		8
1110	Financial assets at fair value through profit or loss (Note
	7)			4,042			-					4,618			-					5,315		-
1170	Notes & accounts receivable-net (Note 8)			13,798,763			41					13,260,199			37					13,402,862		41
1200	Other receivables (Note 22 and 27)			333,010			1					225,839			1					546,932		2
1220	Current tax assets			32,311			-					32,456			-					32,452		-
130X	Inventories - net (Note 9)			3,871,569			11					5,166,981			14					4,161,483		13
1479	Other current assets (Note 15)			1,114,006			3					1,261,998			3					1,413,974		4
11XX	Total current assets			23,026,598			68					24,375,369			67					22,312,483		68
	NON-CURRENT ASSETS
1517	Financial assets at fair value through other
	comprehensive income - non-current (Note 10)			35,318			-					29,687			-					30,971		-
1550	Investments using the equity method (Note 11)			49,000			-					-			-					-		-
1600	Property, plant and equipment (Note 12)			6,501,004			19					6,504,769			18					6,486,649		20
1755	Right-of-use assets (Notes 13 and 28)			289,649			1					310,873			1					339,519		1
1780	Intangible assets (Note 14)			8,907			-					8,360			-					8,297		-
1840	Deferred tax assets			178,889			-					293,471			1					327,635		1
1990	Other non-current assets (Notes 15 and 28)			3,954,048			12					4,714,757			13					3,192,626		10
15XX	Total non-current assets			11,016,815			32					11,861,917			33					10,385,697		32
1XXX	Total assets		$	34,043,413			100			$	36,237,286			100			$	32,698,180		100
Code	LIABILITIES AND EQUITY
	CURRENT LIABILITIES
2100	Short-term borrowings (Note 16)	$	2,050,756			6		$	2,131,144			6		$	2,224,398		7
2110	Short-term bills payable - net (Note 16)			-			-					-			-					389,807		1
2170	Notes and accounts payable			5,686,049			17					7,121,256			19					7,661,109		23
2216	Cash dividends payable			1,914,786			6					-			-					-		-
2219	Other payables (Note 17)			2,107,323			6					4,259,191			12					4,090,946		13
2230	Current tax liabilities			547,448			1					640,862			2					792,035		2
2250	Provisions for liabilities - current (Note 18)			19,255			-					17,023			-					12,205		-
2280	Lease liabilities - current (Notes 13 and 28)			45,126			-					49,366			-					55,365		-
2320	Current portion of long-term borrowings (Note 16)			-			-					-			-					529,412		2
2399	Other current liabilities (Note 21)			43,488			-					45,963			-					68,183		-
21XX	Total current liabilities			12,414,231			36					14,264,805			39					15,823,460		48
	NON-CURRENT LIABILITIES
2580	Lease liabilities - non-current (Note 13 and 28)			211,466			1					227,546			1					248,463		1
2540	Long-term borrowings (Note 16)			-			-					-			-					1,370,000		4
2570	Deferred tax liabilities			432,885			1					396,501			1					485,411		2
2645	Guarantee deposits			33,550			-					33,696			-					32,901		-
25XX	Total non-current liabilities			677,901			2					657,743			2					2,136,775		7
2XXX	Total liabilities			13,092,132			38					14,922,548			41					17,960,235		55
	EQUITY
	Equity attributable to the Company (Notes 20 and 25)
3100	Share capital			3,829,572			11					3,829,572			10					3,329,572		10
3200	Capital surplus			9,698,360			29					9,690,481			27					3,682,051		11
	Retained earnings
3310	Legal reserve			2,199,863			6					1,885,194			5					1,618,630		5
3320	Special reserve			514,181			2					444,936			1					583,390		2
3350	Unappropriated earnings			4,923,852			15					5,978,737			17					6,127,442		19
3300	Total retained earnings			7,637,896			23					8,308,867			23					8,329,462		26
3400	Other equities	(		214,547 )	(	1)	(		514,182 )	(	1)	(		603,140 )	(	2)
3XXX	Total equity			20,951,281			62					21,314,738			59					14,737,945		45
	Total liabilities and equity		$	34,043,413			100			$	36,237,286			100			$	32,698,180		100

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

(Please see the Review Report of Deloitte & Touche on August 2, 2022)

Chairman: Chin-Tsai, Chen

Manager: Hsin-Hui, Tsai

Accounting Supervisor: Jiun-Ren, Huang

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