CTCI CORPORATION AND SUBSIDIARIES · CTCI CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS) (The balance sheets as of June 30,

~1~

CTCI CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND

REVIEW REPORT OF INDEPENDENT

ACCOUNTANTS

JUNE 30, 2019 AND 2018

------------------------------------------------------------------------------------------------------------------------------------

For the convenience of readers and for information purpose only, the auditors’ report and the accompanying

financial statements have been translated into English from the original Chinese version prepared and used in

the Republic of China. In the event of any discrepancy between the English version and the original Chinese

version or any differences in the interpretation of the two versions, the Chinese-language auditors’ report and

financial statements shall prevail.

CTCI CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS) (The balance sheets as of June 30, 2019 and 2018 are reviewed, not audited)

~4~

June 30, 2019 December 31, 2018 June 30, 2018 Assets Notes AMOUNT % AMOUNT % AMOUNT %

Current assets

1100 Cash and cash equivalents 6(1) $ 17,027,571 25 $ 15,070,992 20 $ 15,318,991 24

1110 Financial assets at fair value

through profit or loss - current

6(2)

382,122 1 554,638 1 420,043 1


through other comprehensive

income

6(3)

529,350 1 500,327 1 616,277 1

1136 Financial assets at amortised

cost - current

6(4)

72,903 - 370,331 1 219,509 -

1140 Contract assets - current 6(23) 18,840,920 27 24,823,432 32 21,707,003 35

1150 Notes receivable, net 6(5) 109,921 - 75,006 - 126,932 -

1170 Accounts receivable, net 6(5) 4,714,762 7 9,092,332 12 4,079,928 7

1180 Accounts receivable - related

parties

7

496,773 1 944,071 1 32,013 -

1200 Other receivables 230,637 - 338,477 - 152,303 -

1220 Current income tax assets 150,938 - 134,826 - 107,962 -

130X Inventories 280,426 - 167,345 - 149,645 -

1410 Prepayments 6(6) 5,291,567 8 4,253,895 6 5,129,541 8

1470 Other current assets - - 208,887 - 14,092 -

11XX Total current assets 48,127,890 70 56,534,559 74 48,074,239 76

Non-current assets



income - non-current

6(3)

768,409 1 788,611 1 644,062 1

1550 Investments accounted for

using equity method

6(7)

3,175,468 5 3,680,933 5 3,582,893 6

1600 Property, plant and equipment,

net

6(8) and 8

10,706,079 16 10,432,036 13 6,472,531 10

1755 Right-of-use assets 6(9) 405,955 1 - - - -

1760 Investment property, net 6(10) and 8 805,976 1 808,129 1 810,390 1

1780 Intangible assets 191,347 - 191,198 - 79,301 -

1840 Deferred income tax assets 494,244 1 493,335 1 491,599 1

1900 Other non-current assets 6(11) and 8 3,807,978 5 3,568,532 5 2,788,594 5

15XX Total non-current assets 20,355,456 30 19,962,774 26 14,869,370 24

1XXX Total assets $ 68,483,346 100 $ 76,497,333 100 $ 62,943,609 100

(Continued)

CTCI CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS) (The balance sheets as of June 30, 2019 and 2018 are reviewed, not audited)

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

~5~

June 30, 2019 December 31, 2018 June 30, 2018 Liabilities and Equity Notes AMOUNT % AMOUNT % AMOUNT %

Current liabilities 2100 Short-term borrowings 6(12) $ 10,396,242 15 $ 13,414,459 18 $ 8,047,275 13 2110 Short-term notes and bills

payable

250,913 - - - - - 2120 Financial liabilities at fair value

through profit or loss - current 6(2)

4,487 - 548 - - - 2130 Contract liabilities - current 6(23) 14,196,426 21 13,920,198 18 12,509,386 20 2150 Notes payable 22,229 - 18,788 - 5,224 - 2170 Accounts payable 6(13) 9,664,066 14 9,991,262 13 8,610,127 14 2180 Accounts payable - related

parties 7

792,220 1 1,359,712 2 873,722 1 2200 Other payables 6(14) 4,088,570 6 4,692,516 6 4,658,235 7 2230 Current income tax liabilities 343,299 1 371,943 - 417,397 1 2280 Current lease liabilities 7 126,174 - - - - - 2300 Other current liabilities 6(15)(16) 3,229,848 5 7,650,660 10 3,775,258 6 21XX Total current liabilities 43,114,474 63 51,420,086 67 38,896,624 62 Non-current liabilities 2540 Long-term borrowings 6(16) 3,423,573 5 1,423,586 2 1,854,133 3 2570 Deferred income tax liabilities 248,080 - 411,810 1 394,617 - 2580 Non-current lease liabilities 7 252,473 1 - - - - 2600 Other non-current liabilities 6(17) 2,181,152 3 2,615,692 3 2,434,570 4 25XX Total non-current

liabilities

6,105,278 9 4,451,088 6 4,683,320 7 2XXX Total liabilities 49,219,752 72 55,871,174 73 43,579,944 69 Equity attributable to owners of

parent

Share capital 6(20) 3110 Common stock 7,633,100 11 7,632,738 10 7,632,738 12 Capital surplus 6(21) 3200 Capital surplus 3,648,444 5 3,545,053 4 3,465,498 5 Retained earnings 6(22) 3310 Legal reserve 3,741,648 6 3,558,894 5 3,558,894 6 3320 Special reserve 762,377 1 763,794 1 763,794 1 3350 Unappropriated retained

earnings

806,242 1 2,217,619 3 1,229,073 2 Other equity interest 3400 Other equity interest ( 222,449 ) - ( 247,534 ) - ( 203,649 ) - 3500 Treasury stocks 6(20) ( 11,835 ) - ( 11,835 ) - ( 11,835 ) - 31XX Equity attributable to

owners of the parent

16,357,527 24 17,458,729 23 16,434,513 26 36XX Non-controlling interest 4(3) 2,906,067 4 3,167,430 4 2,929,152 5 3XXX Total equity 19,263,594 28 20,626,159 27 19,363,665 31 Significant contingent liabilities

and unrecognised contract

commitments

9

3X2X Total liabilities and equity $ 68,483,346 100 $ 76,497,333 100 $ 62,943,609 100


CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS, EXCEPT EARNINGS PER SHARE AMOUNTS)

(UNAUDITED)


~6~

Three months ended June 30 Six months ended June 30

2019 2018 2019 2018

Items Notes AMOUNT % AMOUNT % AMOUNT % AMOUNT %

4000 Operating revenue 6(23) and 7 $ 13,381,465 100 $ 13,356,165 100 $ 27,093,923 100 $ 27,896,747 100 5000 Operating costs 6(27)(28) and 7 ( 12,587,382 ) ( 94 ) ( 12,532,897 ) ( 94 ) ( 25,261,270 ) ( 93 ) ( 25,892,560 ) ( 93 ) 5900 Gross Profit 794,083 6 823,268 6 1,832,653 7 2,004,187 7 Operating expenses 6(27)(28) 6200 General and administrative expenses ( 395,353 ) ( 3 ) ( 406,630 ) ( 3 ) ( 804,520 ) ( 3 ) ( 842,280 ) ( 3 ) 6300 Research and development expenses ( 30,847 ) - ( 32,882 ) - ( 56,020 ) - ( 61,694 ) - 6000 Total operating expenses ( 426,200 ) ( 3 ) ( 439,512 ) ( 3 ) ( 860,540 ) ( 3 ) ( 903,974 ) ( 3 ) 6900 Operating income 367,883 3 383,756 3 972,113 4 1,100,213 4 Non-operating income and expenses 7010 Other income 6(24) 98,659 1 74,684 - 174,057 1 135,933 - 7020 Other gains and losses 6(25) 142,557 1 285,906 2 170,421 1 155,208 1 7050 Finance costs 6(26) ( 42,518 ) - ( 42,492 ) - ( 124,575 ) ( 1 ) ( 79,181 ) - 7060 Share of loss of associates and joint ventures accounted for under equity method 6(7) ( 59,845 ) ( 1 ) ( 32,307 ) - ( 208,525 ) ( 1 ) ( 17,997 ) - 7000 Total non-operating income and expenses 138,853 1 285,791 2 11,378 - 193,963 1 7900 Profit before income tax 506,736 4 669,547 5 983,491 4 1,294,176 5 7950 Income tax expense 6(29) ( 106,033 ) ( 1 ) ( 124,156 ) ( 1 ) ( 239,121 ) ( 1 ) ( 311,733 ) ( 1 ) 8200 Profit for the period $ 400,703 3 $ 545,391 4 $ 744,370 3 $ 982,443 4

Components of other comprehensive income that will not be reclassified to

profit or loss

8311 Actuarial losses on defined benefit plans $ - - ( $ 19,951 ) - $ - - $ - - 8316 Unrealized gain or loss on valuation of financial assets at fair value through

other comprehensive income

6(3)

11,088 - ( 746 ) - 47,982 - 30,398 - 8320 Share of other comprehensive income of associates and joint ventures accounted

for using equity method

- - 572 - - - 1,079 - 8349 Income tax related to components of other comprehensive income that will not

be reclassified to profit or loss

6(29)

- - 19,379 - - - 19,379 - Components of other comprehensive income that will be reclassified to profit or

loss

8361 Cumulative translation differences of foreign operations ( 35,316 ) - 95,781 1 ( 11,345 ) - 47,228 - 8300 Total other comprehensive (loss) income for the period ( $ 24,228 ) - $ 95,035 1 $ 36,637 - $ 98,084 -

8500 Total comprehensive income for the period $ 376,475 3 $ 640,426 5 $ 781,007 3 $ 1,080,527 4

Profit attributable to: 8610 Owners of the parent $ 272,064 2 $ 408,982 3 $ 493,537 2 $ 727,722 3 8620 Non-controlling interest 128,639 1 136,409 1 250,833 1 254,721 1 Total $ 400,703 3 $ 545,391 4 $ 744,370 3 $ 982,443 4

Comprehensive income attributable to: 8710 Owners of the parent $ 272,752 2 $ 486,156 4 $ 516,255 2 $ 817,376 3 8720 Non-controlling interest 103,723 1 154,270 1 264,752 1 263,151 1 Total $ 376,475 3 $ 640,426 5 $ 781,007 3 $ 1,080,527 4

9750 Basic earnings per share 6(30) $ 0.36 $ 0.54 $ 0.65 $ 0.95

9850 Diluted earnings per share 6(30) $ 0.36 $ 0.54 $ 0.65 $ 0.95


CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

(UNAUDITED)

Equity attributable to owners of the parent

Retained Earnings Other Equity Interest

Notes

Common stock

Capital surplus

Legal reserve

Special reserve

Unappropriated

earnings

Cumulative

translation

differences of

foreign operations

Unrealized gains

(losses) from

financial assets

measured at fair

value through

other

comprehensive

income

Unrealized gain or

loss on available-

for-sale financial

assets

Treasury

stocks

Total

Non-controlling

interests

Total equity


~7~

For the six-month period ended June 30, 2018 Balance at January 1, 2018 $ 7,632,738 $ 3,395,620 $ 3,278,360 $ 765,904 $ 3,061,699 ( $ 226,282 ) $ - $ 55,828 ( $ 11,835 ) $ 17,952,032 $ 3,088,125 $ 21,040,157 Effect of retrospective application and retrospective restatement 6(22) - - - - 166,327 - ( 47,070 ) ( 55,828 ) - 63,429 - 63,429 Balance at January 1 after adjustments 7,632,738 3,395,620 3,278,360 765,904 3,228,026 ( 226,282 ) ( 47,070 ) - ( 11,835 ) 18,015,461 3,088,125 21,103,586 Profit for the period - - - - 727,722 - - - - 727,722 254,721 982,443 Other comprehensive income - - - - 19,951 43,959 25,744 - - 89,654 8,430 98,084 Total comprehensive income - - - - 747,673 43,959 25,744 - - 817,376 263,151 1,080,527 Appropriations of 2017 earnings 6(22) Legal reserve - - 280,534 - ( 280,534 ) - - - - - - - Special reserve - - - ( 2,110 ) 2,110 - - - - - - - Cash dividends - - - - ( 2,468,202 ) - - - - ( 2,468,202 ) ( 449,021 ) ( 2,917,223 ) Employee stock options exercised by subsidiary 6(21) - 5,315 - - - - - - - 5,315 18,025 23,340 Share-based payment transactions 6(21) - 64,563 - - - - - - - 64,563 647 65,210 Increase in non-controlling interest - - - - - - - - - - 8,225 8,225 Balance at June 30, 2018 $ 7,632,738 $ 3,465,498 $ 3,558,894 $ 763,794 $ 1,229,073 ( $ 182,323 ) ( $ 21,326 ) $ - ( $ 11,835 ) $ 16,434,513 $ 2,929,152 $ 19,363,665

For the six-month period ended June 30, 2019 Balance at January 1, 2018 $ 7,632,738 $ 3,545,053 $ 3,558,894 $ 763,794 $ 2,217,619 ( $ 290,028 ) $ 42,494 $ - ( $ 11,835 ) $ 17,458,729 $ 3,167,430 $ 20,626,159 Profit for the period - - - - 493,537 - - - - 493,537 250,833 744,370 Other comprehensive income - - - - - ( 7,164 ) 29,882 - - 22,718 13,919 36,637 Total comprehensive income - - - - 493,537 ( 7,164 ) 29,882 - - 516,255 264,752 781,007 Appropriations of 2018 earnings 6(22) Legal reserve - - 182,754 - ( 182,754 ) - - - - - - - Special reserve - - - ( 1,417 ) 1,417 - - - - - - - Cash dividends - - - - ( 1,721,210 ) - - - - ( 1,721,210 ) ( 529,621 ) ( 2,250,831 ) Employee stock options exercised 6(20)(21) 362 1,316 - - - - - - - 1,678 - 1,678 Share-based payment transactions 6(21) - 102,075 - - - - - - - 102,075 3,506 105,581 Disposal of investments in equity instruments designated at fair value through other comprehensive income

- - - - ( 2,367 ) - 2,367 - - - - -

Balance at June 30, 2019 $ 7,633,100 $ 3,648,444 $ 3,741,648 $ 762,377 $ 806,242 ( $ 297,192 ) $ 74,743 $ - ( $ 11,835 ) $ 16,357,527 $ 2,906,067 $ 19,263,594


CONSOLIDATED STATEMENTS OF CASH FLOWS


(UNAUDITED)

For the six-month periods ended June 30

Notes 2019 2018

~8~

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax $ 983,491 $ 1,294,176 Adjustments Adjustments to reconcile profit (loss) Gain on valuation of financial assets 6(25) ( 56,214 ) ( 26,136 ) Gain on reduction of capital of investments 6(25) ( 5,158 ) ( 64,420 ) Loss (gain) on disposal of property, plant and

equipment 6(25)

1,353 ( 66,798 ) Share of loss of associates and joint ventures

accounted for under equity method 6(7)

208,525 17,997 Depreciation 6(27) 282,881 179,778 Amortization 6(27) 74,638 77,765 Expected credit loss 12(2) 255 18,161 Interest income 6(24) ( 131,825 ) ( 107,931 ) Dividends income 6(23) ( 230 ) - Interest expense 6(26) 124,575 79,181 Compensation costs for employee stock options 6(28) 141,783 65,258 Changes in operating assets and liabilities Changes in operating assets Financial assets at fair value through profit or loss 166,790 356,191 Notes receivable ( 34,915 ) ( 93,782 ) Accounts receivable 4,377,315 1,227,302 Accounts receivable - related parties 447,298 10,346 Contract assets - current 5,982,512 2,052,307 Other receivables 108,907 72,002 Other receivables - related parties - 9,378 Inventories ( 113,081 ) 43,529 Prepayments ( 1,037,672 ) ( 982,128 ) Other current assets 208,887 8,088 Other non-current assets 84,690 115,957 Changes in operating liabilities Notes payable 3,441 1,155 Accounts payable ( 327,196 ) ( 3,268,147 ) Accounts payable - related parties ( 567,492 ) ( 52,988 ) Contract liabilities - current 276,228 ( 1,370,720 ) Other payables ( 931,800 ) ( 936,446 ) Other payables - related parties - ( 20 ) Other current liabilities ( 4,488,308 ) ( 3,715,087 ) Other non-current liabilities ( 363,273 ) ( 309,020 ) Cash inflow (outflow) generated from operations 5,416,405 ( 5,365,052 ) Interest received 130,758 114,732 Dividends received 63,685 72,063 Interest paid ( 126,758 ) ( 77,275 ) Income tax paid ( 386,692 ) ( 415,506 ) Net cash flows from (used in) operating activities 5,097,398 ( 5,671,038 )

(Continued)


CONSOLIDATED STATEMENTS OF CASH FLOWS


(UNAUDITED)

For the six-month periods ended June 30

Notes 2019 2018


~9~

CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds from disposal of financial assets at fair value

through other comprehensive income - current

$ 39,388 $ 202,556

Proceeds from disposal of financial assets at amortised

cost

297,428 89,693

Increase in investments accounted for under the equity

method

6(7)

- ( 27,500 )

Proceeds from disposal of investments accounted for

using equity method

224,494 -

Acquisition of property, plant and equipment 6(33) ( 2,209,867 ) ( 79,426 )

Proceeds from disposal of property, plant and equipment 2,569 226,388

Increase in prepayments for equipment ( 380,744 ) -

Increase in intangible assets ( 24,110 ) ( 12,826 )

Increase in refundable deposits ( 8,562 ) ( 993 )

Increase in other non-current assets ( 30,240 ) ( 30,583 )

Net cash flows from acquisition of subsidiaries ( 38,749 ) ( 49,440 )

Net cash flows (used in) from investing activities ( 2,128,393 ) 317,869

CASH FLOWS FROM FINANCING ACTIVITIES

(Decrease) increase in short-term borrowings ( 3,018,217 ) 1,508,258

Increase in short-term notes and bills payable 250,913 -

Increase (decrease) in long-term borrowings 2,067,483 ( 172,200 )

Decrease in lease liabilities 6(9) ( 105,999 ) -

(Decrease) increase in deposits received (recognized in

other non-current liabilities)

( 71,267 ) 19,880

Proceeds from employee stock options exercised 1,678 30,334

Cash dividends paid 6(33) ( 137,017 ) ( 73,092 )

Increase in non-controlling interest - 4,100

Net cash flows (used in) from financing activities ( 1,012,426 ) 1,317,280

Net increase (decrease) in cash and cash equivalents 1,956,579 ( 4,035,889 )

Cash and cash equivalents at beginning of period 15,070,992 19,354,880

Cash and cash equivalents at end of period $ 17,027,571 $ 15,318,991

~10~


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2019 AND 2018

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS,

EXCEPT AS OTHERWISE INDICATED)

(UNAUDITED)

1. HISTORY AND ORGANISATION

CTCI Corporation (the “Company”) was incorporated as a company limited by shares under the

provisions of the Company Law of the Republic of China on April 6, 1979 and commenced its operations

on May 1, 1979. The main business activities of the Company and its subsidiaries (collectively referred

herein as the “Group”) are the design, survey, construction and inspection of various engineering and

construction projects, plants, machinery and equipment and environmental protection projects. The

Company’s shares have been listed and traded on the Taiwan Stock Exchange since May 1993.

2. THE DATE OF AUTHORISATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL

STATEMENTS AND PROCEDURES FOR AUTHORISATION

These consolidated financial statements were reported to the Board of Directors on August 2, 2019.

3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

(1) Effect of the adoption of new issuances of or amendments to International Financial Reporting

Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)

New standards, interpretations and amendments endorsed by the FSC effective from 2019 are as

follows:

Except for the following, the above standards and interpretations have no significant impact to the

Group’s financial condition and financial performance based on the Group’s assessment.

New Standards, Interpretations and Amendments

Effective date by

International

Accounting

Standards Board

Amendments to IFRS 9, ‘Prepayment features with negative compensation’ January 1, 2019

IFRS 16, ‘Leases’ January 1, 2019

Amendments to IAS 19, ‘Plan amendment, curtailment or settlement’ January 1, 2019

Amendments to IAS 28, ‘Long-term interests in associates and joint ventures’ January 1, 2019

IFRIC 23, ‘Uncertainty over income tax treatments’ January 1, 2019

Annual improvements to IFRSs 2015-2017 cycle January 1, 2019

~11~

IFRS 16, ‘Leases’

A. IFRS 16, ‘Leases’, replaces IAS 17, ‘Leases’ and related interpretations and SICs. The standard

requires lessees to recognise a ‘right-of-use asset’ and a lease liability (except for those leases with

terms of 12 months or less and leases of low-value assets). The accounting stays the same for

lessors, which is to classify their leases as either finance leases or operating leases and account for

those two types of leases differently. IFRS 16 only requires enhanced disclosures to be provided

by lessors.

B. The Group has elected to apply IFRS 16 by not restating the comparative information (referred

herein as the ‘modified retrospective approach’) when applying “IFRSs” effective in 2019 as

endorsed by the FSC. Accordingly, the Group increased ‘right-of-use asset’ by $416,416 and

increased ‘lease liability’ by $416,416 with respect to the lease contracts of lessees on January 1,

2019.

C. The Group has used the following practical expedients permitted by the standard at the date of

initial application of IFRS 16:

(a) Reassessment as to whether a contract is, or contains, a lease is not required, instead, the

application of IFRS 16 depends on whether or not the contracts were previously identified as

leases applying IAS 17 and IFRIC 4.

(b) The use of a single discount rate to a portfolio of leases with reasonably similar characteristics.

(c) The accounting for operating leases whose period will end before December 31, 2019 as short-

term leases and accordingly, rent expense of $149,657 was recognized in the second quarter

of 2019.

(d) The exclusion of initial direct costs for the measurement of ‘right-of-use asset’.

(e) The use of hindsight in determining the lease term where the contract contains options to

extend or terminate the lease.

D. The Group calculated the present value of lease liabilities by using the weighted average

incremental borrowing interest rate of 0.68%.

E. The Group recognized lease liabilities which had previously been classified as ‘operating leases’

under the principles of IAS 17, ‘Leases’. The reconciliation between operating lease commitments

under IAS 17 measured at the present value of the remaining lease payments, discounted using

the lessee’s incremental borrowing rate and lease liabilities recognized as of January 1, 2019 is as

follows:

Operating lease commitments disclosed by applying IAS 17 as at

December 31, 2018 768,470$

Less: Short-term leases 20,952)(

Add/Less: Adjustments relating to changes in the index or rate

affecting variable lease payments 331,102)(

Total lease contracts amount recognised as lease liabilities by

applying IFRS 16 on January 1, 2019416,416$

~12~

(2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by

the Group

None.

(3) IFRSs issued by IASB but not yet endorsed by the FSC

New standards, interpretations and amendments issued by IASB but not yet included in the IFRSs as

endorsed by the FSC are as follows:

The above standards and interpretations have no significant impact to the Group’s financial condition

and financial performance based on the Group’s assessment.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted are consistent with Note 4 in the consolidated financial

statements for the year ended December 31, 2018, except for the compliance statement, basis of

preparation, basis of consolidation and additional policies as set out below. These policies have been

consistently applied to all the periods presented, unless otherwise stated.

(1) Compliance statement

A. The consolidated financial statements of the Group have been prepared in accordance with the

“Regulations Governing the Preparation of Financial Reports by Securities Issuers” and the

International Accounting Standard 34, ‘Interim financial reporting’ as endorsed by the FSC.

B. These consolidated financial statements are to be read in conjunction with the consolidated

financial statements for the year ended December 31, 2018.

(2) Basis of preparation

A. Except for the following items, the consolidated financial statements have been prepared under

the historical cost convention:

(a) Financial assets and financial liabilities (including derivative instruments) at fair value through

profit or loss.

(b) Financial assets at fair value through other comprehensive income.

New Standards, Interpretations and Amendments

Effective date by

International Accounting

Standards Board

Amendments to IAS 1 and IAS 8, ‘Disclosure Initiative-Definition of

Material’

January 1, 2020

Amendments to IFRS 3, ‘Definition of a business’ January 1, 2020

Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets

between an investor and its associate or joint venture’

To be determined by

International Accounting

Standards Board

IFRS 17, ‘Insurance contracts’ January 1, 2021

~13~

(c) Defined benefit liabilities recognized based on the net amount of pension fund assets less

present value of defined benefit obligation.

B. The preparation of financial statements in conformity with IFRS, requires the use of certain critical

accounting estimates. It also requires management to exercise its judgement in the process of

applying the Group’s accounting policies. The areas involving a higher degree of judgement or

complexity, or areas where assumptions and estimates are significant to the consolidated financial

statements are disclosed in Note 5.

(3) Basis of consolidation

A. Basis for preparation of consolidated financial statements:

The basis for preparation of these consolidated financial statements is the same as that for the

preparation of the consolidated financial statements as of and for the year ended December 31,

2018.

B. Subsidiaries included in the consolidated financial statements:

Name of Investor Name of SubsidiaryMain Business

ActivitiesJune 30, 2019

December 31,

2018June 30, 2018 Description

CTCI Corp. CTCI Advanced

Systems Inc.

Design and

installation of

software

48.72 48.72 48.72 Note 1

CTCI Corp. CTCI Development

Corp.

Real estate and

leasing business

100.00 100.00 100.00 Note 2,3

CTCI Corp. CTCI Investment

Corp.

Investments 100.00 100.00 100.00 Note 3

CTCI Corp.

CTCI Investment

Corp.

CTCI Smart

Engineering Corp.

Planning and

design of

construction

projects

97.09 97.09 97.09 Note 3

CTCI Corp.

CTCI Development

Corp.

CTCI Resources

Engineering Inc.

Planning, design

and

supervision of

mechanical and

electrical

engineering

projects

99.06 99.06 99.06 Note 3

CTCI Corp. CTCI Americas,

Inc.

Business

development and

related engineering

services and

planning

100.00 100.00 100.00 Note 3

CTCI Corp. CTCI Singapore Pte.

Ltd.

Planning and

design of

construction

projects

100.00 100.00 100.00 Note 3

Ownership (%)

~14~



December 31,


CTCI Investment

Corp.

CTCI Development

Corp.

ECOVE Environment

Services Corp.

CTCI Smart

Engineering Corp.

CTCI Resources

Engineering Inc.

CTCI Chemical

Corp.

Manufacturing of

chemical products

75.49 75.49 75.49 Note 3

CTCI Corp.

CTCI Investment

Corp.

CTCI Development

Corp.

ECOVE

Environment Corp.

Investments 57.72 57.72 57.72

ECOVE Environment

Corp.

ECOVE Wujih

Energy Corp.

Environmental

engineering

100.00 98.00 98.00 Note 8

ECOVE Environment

Services Corp.

- 2.00 2.00

ECOVE Environment

Corp.

ECOVE Waste

Management Corp.

Environmental

engineering

100.00 100.00 100.00

ECOVE Environment

Corp.

ECOVE Waste

Management Corp.

ECOVE

Environment

Services Corp.

Environmental

engineering

93.16 93.16 93.16

ECOVE Environment

Corp.

ECOVE Environment

Services Corp.

ECOVE Miaoli

Energy Corp.

Environmental

engineering

75.00 75.00 75.00

ECOVE Environment

Corp.

Yuan Ding

Resources

Management Corp.

Environmental

engineering

100.00 60.00 60.00

ECOVE Waste

Management Corp.

- 40.00 40.00

ECOVE Environment

Services Corp.

ECOVE

Environment

Consulting Corp.

Environmental

engineering

100.00 100.00 100.00 Note 3

CTCI Corp.

ECOVE Environment

Services Corp.

SINOGAL-Waste

Services CO., Ltd.

Environmental

engineering

60.00 60.00 60.00 Note 3

CTCI Corp. CTCI Overseas

(BVI) Corp.


CTCI Overseas (BVI)

Corp.

CTCI Overseas Co.,

Ltd.

Planning and

design of

construction

projects

100.00 100.00 100.00 Note 3

Ownership (%)

Note 3, 8

~15~



December 31,


CTCI Overseas Co.,

Ltd.

CTCI Beijing Co.,

Ltd.

Planning and

design of

construction

projects

100.00 100.00 100.00 Note 3

CTCI Overseas Co.,

Ltd.

CIMAS Engineering

Company

Planning and

design of

construction

projects

83.00 50.00 50.00 Note 3,7

CTCI Overseas Co.,

Ltd.

Universal

Engineering (BVI)

Corp.

Planning and

design of

construction

projects

100.00 100.00 100.00 Note 3

CTCI Overseas Co.,

Ltd.

CIPEC Construction

Company Inc.

Planning and

design of

construction

projects

39.89 39.89 39.89 Note 1,3

CTCI Overseas Co.,

Ltd.

CINDA Engineering

& Construction

Private Limited

Planning and

design of

construction

projects

100.00 100.00 100.00 Note 3

CTCI Corp.

CTCI Overseas Co.,

Ltd.

CTCI Arabia Ltd. Design and

construction of

chemical factories

100.00 100.00 100.00 Note 3

CTCI Smart

Engineering

Corp.

CTCI Overseas Co.,

Ltd.

CTCI Shanghai Co.,

Ltd.

Consulting services

for construction

projects

- - 100.00 Note 3,6

CTCI Beijing Co.,

Ltd.

CTCI Shanghai Co.,

Ltd.

Consulting services

for construction

projects

100.00 100.00 - Note 3,6

CTCI Shanghai Co.,

Ltd.

CTCI Trading

Shanghai Co., Ltd.

General trade 100.00 100.00 100.00 Note 3,6

CTCI Corp.

CTCI Overseas Co.,

Ltd.

CTCI Engineering

& Construction

Sdn. Bhd.

Planning and

design of

construction

projects

100.00 100.00 100.00 Note 3

CTCI Overseas Co.,

Ltd.

Sumber Mampu

Sdn. Bhd.

Investments 10.00 10.00 10.00 Note 1, 3

Ownership (%)

~16~



December 31,


Sumber Mampu Sdn.

Bhd.

CTCI Engineering &

Construction Sdn.

Bhd.

CTCI Corp.

Superiority

(Thailand) Co., Ltd.

CTCI (Thailand)

Co., Ltd.

Planning and

design of

construction

projects

100.00 100.00 100.00 Note 3

CTCI Advanced

Systems Inc.

Century Ahead Ltd. Investments 100.00 100.00 100.00 Note 3

Century Ahead Ltd. CTCI Advanced

Systems Shanghai

Inc.

Computer skills

services

100.00 100.00 100.00 Note 3

Universal

Engineering (BVI)

Corp.

Superiority


Planning and

design of

construction

projects

100.00 100.00 100.00 Note 3

CTCI Corp. CTCI Machinery

Corp.

Planning and

design of

construction

projects

100.00 100.00 100.00 Note 3

CTCI Corp. CCJV P1

Engineering &

Construction Sdn.

Bhd.

Planning of

construction

projects

99.00 99.00 99.00 Note 3

CTCI Development

Corporation

Crown Asia-2

Investment Limited


CTCI Singapore Pte.

Ltd.

CTCI Netherlands

B.V.

Engineers and

other technical

design and

consultancy

100.00 100.00 100.00 Note 3

CTCI Corp. CTCI-HDEC

(Chungli)

Corporation.

Waste water

treatment

Sewerage System

51.00 51.00 51.00 Note 3

CTCI Corp. CTCI CMCE JV

SDN. BHD.

Planning and

design of

construction

projects

51.00 51.00 51.00 Note 3

ECOVE Environment

Corp.

ECOVE Environment

Services Corp.

ECOVE Solvent

Recycling

Corporation

Environmental

engineering

90.00 90.00 90.00 Note 3,4

ECOVE Environment

Corp.

ECOVE Solar

Energy Corporation

Electric Power

Supply

100.00 100.00 50.00 Note 5

CTCI MALAYSIA

Sdn. Bhd.

Planning and

design of

construction

projects

Note 3

Ownership (%)

100.00 100.00 100.00

~17~

Note 1: Being the Company’s controlled entities, these subsidiaries that were under 50% owned

by the Company directly or indirectly were included in the consolidated financial

statements.

Note 2: On December 12, 2018, the Company's Board of Directors decided to increase its share

in the subsidiary, CTCI Development Corp., with a total investment amount of

$1,800,000. As of June 30, 2019 and December 31, 2018, the Company has invested

$180,000.

Note 3: The financial statements of the entity as of and for the six-month periods ended June 30,

2019 and 2018 were not reviewed by the independent accountants as the entity did not

meet the definition of significant subsidiary.

Note 4: In May 2018, the subsidiaries, ECOVE Environment Corp. and ECOVE Environment

Services Corp., acquired ECOVE Solvent Recycling Corp. by cash, which became a

subsidiary whose 90% equity was indirectly held by the Company. The acquiree was

consolidated into the financial statements effective from the date of acquisition.

Note 5: The subsidiary, ECOVE Environment Corp.,which originally held 50% of the equity of

ECOVE Solar Energy Corporation, acquired the remaining shares of ECOVE Solar

Energy Corporation by cash in September 2018, and became a subsidiary whose 100%

equity was indirectly held by the Group. The acquiree was consolidated into the financial

statements effective from the date of acquisition.

Note 6: In August 2018, the subsidiary, CTCI Beijing Co., Ltd, acquired a 100% equity interest

of the subsidiaries, CTCI Smart Engineering Corp. and CTCI Overseas Co., Ltd., by cash

and shares.

Note 7: In March 2019, CTCI Overseas Co., Ltd. purchased 646 thousand shares of CIMAS

Engineering Company and obtained 33% of the shares.

Note 8: In May 2019, the Group implemented an organisational restructuring. ECOVE

Environment Services Corp. and ECOVE Waste Management Corp. sold its originally

held 2% equity interest of ECOVE Wujih Energy Corp. and 40% equity interest of Yuan

Ding Resources Management Corp. to ECOVE Environment Corp.



December 31,


ECOVE Solar Energy

Corporation

ECOVE Solar

Power Corporation

Electric Power

Supply

100.00 100.00 - Note 3,5

ECOVE Solar Energy

Corporation

ECOVE Central

Corporation Ltd.

Electric Power

Supply

100.00 100.00 - Note 3,5

ECOVE Solar Energy

Corporation

ECOVE South

Corporation Ltd.

Electric Power

Supply

100.00 100.00 - Note 3,5

ECOVE Solar Energy

Corporation

G.D International,

LLC.

Electric Power

Supply

100.00 100.00 - Note 3,5

G.D International,

LLC.

Lumberton Solar

W2-090, LCC.

Electric Power

Supply

100.00 100.00 - Note 3,5

Ownership (%)

~18~

C. Subsidiaries not included in the consolidated financial statements: None.

D. Adjustments for subsidiaries with different balance sheet date: None.

E. Significant restrictions: None.

F. Subsidiaries that have non-controlling interests that are material to the Group:

As of June 30, 2019, December 31, 2018 and June 30, 2018, the non-controlling interest amounted

to $2,906,067, $3,167,430 and $2,929,152, respectively. The information on non-controlling

interest and respective subsidiaries is as follows:

Summarized financial information of the subsidiaries:

Balance sheets

Statements of comprehensive income

Name of subsidiary

Principal place

of business Amount Ownership (%) Amount Ownership (%) Amount Ownership (%)

ECOVE Environment

Corp.

Taiwan 2,376,305$ 42.28% 2,571,278$ 42.28% 2,320,042$ 42.28%

Non-controlling interest

June 30, 2019 December 31, 2018 June 30, 2018


Current assets 3,959,024$ 3,574,782$ 4,344,695$

Non-current assets 5,937,924 5,500,925 3,357,416

Current liabilities 2,521,948)( 1,496,920)( 2,201,711)(

Non-current liabilities 2,337,498)( 2,157,428)( 559,658)(

Total net assets 5,037,502$ 5,421,359$ 4,940,742$

ECOVE Environment Corp.

2019 2018

Revenue 1,255,554$ 1,206,742$

Profit before income tax 303,277 320,511

Income tax expense 46,516)( 57,264)(

Profit for the period 256,761 263,247

Other comprehensive income, net of tax 3,453 37,314

Total comprehensive income for the period 260,214$ 300,561$

Comprehensive income attributable

to non-controlling interest 50,246$ 55,247$

Dividends paid to non-controlling interest 184,766$ 127,558$


For the three-month periods ended June 30,

~19~

Statements of cash flows

(4) Leasing arrangements (lessee)－right-of-use assets/ lease liabilities

Effective 2019

A. Leases are recognizsed as a right-of-use asset and a corresponding lease liability at the date at

which the leased asset is available for use by the Group. For short-term leases or leases of low

value assets, lease payments are recognized as an expense on a straight-line basis over the lease

term.

B. Lease liabilities include the net present value of the remaining lease payments at the commencement

date, discounted using the incremental borrowing interest rate. Lease payments are comprised of the

fixed payments, less any lease incentives receivable.

The Group subsequently measures the lease liability at amortised cost using the interest method and

recognizes interest expense over the lease term. The lease liability is remeasured and the amount of

remeasurement is recognized as an adjustment to the right-of-use asset when there are changes in the

lease term or lease payments and such changes do not arise from contract modifications.

2019 2018

Revenue 2,539,391$ 2,394,854$

Profit before income tax 604,482 626,722



Other comprehensive income, net of tax 20,463 17,775

Total comprehensive income for the period 521,661$ 501,774$

Comprehensive income attributable

to non-controlling interest 98,581$ 90,202$

Dividends paid to non-controlling interest 184,766$ 127,558$


For the six-month periods ended June 30,

2019 2018

Net cash provided by operating activities 538,786$ 802,380$

Net cash used in investing activities 271,186)( 622,591)(

Net cash provided by (used in)

financing activities 255,342 166,037)(

Increase in cash and cash equivalents

for the period 522,942 13,752

Cash and cash equivalents, beginning of period 1,543,162 1,657,955

Cash and cash equivalents, end of period 2,066,104$ 1,671,707$



~20~

C. At the commencement date, the right-of-use asset is stated at cost comprising the following:

(a) The amount of the initial measurement of lease liability;

(b) Any lease payments made at or before the commencement date.

The right-of-use asset is measured subsequently using the cost model and is depreciated from the

commencement date to the earlier of the end of the asset’s useful life or the end of the lease term.

When the lease liability is remeasured, the amount of remeasurement is recognized as an

adjustment to the right-of-use asset.

(5) Employee benefits

A. Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected

to be paid in respect of service rendered by employees in a period and should be recognized as

expense in that period when the employees render service.

B. Pensions

(a) Defined contribution plans

For defined contribution plans, the contributions are recognized as pension expenses when

they are due on an accrual basis. Prepaid contributions are recognized as an asset to the extent

of a cash refund or a reduction in the future payments.

(b) Defined benefit plans

i. Net obligation under a defined benefit plan is defined as the present value of an amount

of pension benefits that employees will receive on retirement for their services with the

Group in current period or prior periods. The rate used to discount is determined by using

interest rates of high-quality corporate bonds that are denominated in the currency in

which the benefits will be paid, and that have terms to maturity approximating the terms

of related pension liability; when there is no deep market in high-quality corporate bonds,

the Group uses interest rates of government bonds (at the balance sheet date) instead.

ii. Remeasurements arising on defined benefit plans are recognized in other comprehensive

income in the period in which they arise and are recorded as retained earnings.

iii. Past service costs are recognized immediately in profit or loss.

iv. Pension cost for the interim period is calculated on a year-to-date basis by using the

pension cost rate derived from the actuarial valuation at the end of the prior financial year,

adjusted for significant market fluctuations since that time and for significant curtailments,

settlements, or other significant one-off events. Also, the related information is disclosed

accordingly.

~21~

C. Termination benefits

Termination benefits are employee benefits provided in exchange for the termination of

employment as a result from either the Group’s decision to terminate an employee’s employment

before the normal retirement date, or an employee’s decision to accept an offer of redundancy

benefits in exchange for the termination of employment. The Group recognizes expense as it can

no longer withdraw an offer of termination benefits or it recognizes relating restructuring costs,

whichever is earlier. Benefits that are expected to be due more than 12 months after balance sheet

date shall be discounted to their present value.

D. Employees’ compensation, directors’ and supervisors’ remuneration

Employees’ compensation and directors’ and supervisors’ remuneration are recognized as

expenses and liabilities, provided that such recognition is required under legal or constructive

obligation and those amounts can be reliably estimated. Any difference between the resolved

amounts and the subsequently actual distributed amounts is accounted for as changes in estimates.

(6) Income tax

A. The tax expense for the period comprises current and deferred tax. Tax is recognized in profit or

loss, except to the extent that it relates to items recognized in other comprehensive income or

items recognized directly in equity, in which cases the tax is recognized in other comprehensive

income or equity.

B. The current income tax charge is calculated on the basis of the tax laws enacted or substantively

enacted at the balance sheet date in the countries where the Company and its subsidiaries operate

and generate taxable income. Management periodically evaluates positions taken in tax returns

with respect to situations in accordance with applicable tax regulations. It establishes provisions

where appropriate based on the amounts expected to be paid to the tax authorities. An additional

10% tax is levied on the unappropriated retained earnings and is recorded as income tax expense

in the year the stockholders resolve to retain the earnings.

C. Deferred tax is recognized, using the balance sheet liability method, on temporary differences

arising between the tax bases of assets and liabilities and their carrying amounts in the

consolidated balance sheet. Deferred tax is determined using tax rates (and laws) that have been

enacted or substantially enacted by the balance sheet date and are expected to apply when the

related deferred tax asset is realized or the deferred income tax liability is settled.

D. Deferred tax assets are recognized only to the extent that it is probable that future taxable profit

will be available against which the temporary differences can be utilized. At each balance sheet

date, unrecognized and recognized deferred tax assets are reassessed.

~22~

E. Current tax assets and liabilities are offset and the net amount reported in the balance sheet when

there is a legally enforceable right to offset the recognized amounts and there is an intention to

settle on a net basis or realize the asset and settle the liability simultaneously. Deferred tax assets

and liabilities are offset on the balance sheet when the entity has the legally enforceable right to

offset current tax assets against current tax liabilities and they are levied by the same taxation

authority on either the same entity or different entities that intend to settle on a net basis or realize

the asset and settle the liability simultaneously.

F. A deferred tax asset shall be recognized for the carryforward of unused tax credits resulting from

research and development expenditures, to the extent that it is possible that future taxable profit

will be available against which the unused tax credits can be utilized.

G. The interim period income tax expense is recognized based on the estimated average annual

effective income tax rate expected for the full financial year applied to the pretax income of the

interim period, and the related information is disclosed accordingly.

H. If a change in tax rate is enacted or substantively enacted in an interim period, the Group

recognizes the effect of the change immediately in the interim period in which the change occurs.

The effect of the change on items recognized outside profit or loss is recognized in other

comprehensive income or equity while the effect of the change on items recognized in profit or

loss is recognized in profit or loss.

5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF

ASSUMPTION UNCERTAINTY

There have been no significant changes as of June 30, 2019. Please refer to Note 5 of the consolidated

financial statements for the year ended December 31, 2018.

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

A. The Group transacts with a variety of financial institutions all with high credit quality to disperse

credit risk, so it expects that the probability of counterparty default is remote.

B. Details of the Group’s cash and cash equivalents pledged to others as collateral are provided in

Note 8.


Cash on hand and revolving funds $ 266,366 $ 353,440 324,680$

Checking accounts and demand deposits 9,889,384 8,820,471 5,744,898

Time deposits 6,871,821 5,897,081 9,249,413

17,027,571$ 15,070,992$ 15,318,991$

~23~

(2) Financial assets and liabilities at fair value through profit or loss

A. Amounts recognized in profit or loss in relation to financial assets at fair value through profit or

loss are listed below:

Items June 30, 2019 December 31, 2018 June 30, 2018

Current items:

Financial assets mandatorily measured

at fair value through profit or loss

Beneficiary certificates 368,083$ 505,965$ 377,139$

Derivatives 12,781 50,315 41,728

380,864 556,280 418,867

Valuation adjustment 1,258 1,642)( 1,176

382,122$ 554,638$ 420,043$

Financial liabilities mandatorily measured


Derivatives 4,487$ 548$ -$

2019 2018



Beneficiary certificates 1,156$ 13,773)($

Derivatives 24,907 52,179

Unlisted shares - 15,117

26,063$ 53,523$

2019 2018



Beneficiary certificates 3,807$ 13,775)($

Derivatives 52,407 39,910

Unlisted shares - -

56,214$ 26,135$



~24~

B. The Group entered into contracts relating to derivative financial assets and liabilities which were

not accounted for under hedge accounting. The information is listed below:

The Group entered into forward foreign exchange contracts to hedge exchange rate risk of import

or export proceeds. However, these forward foreign exchange contracts are not accounted for

under hedge accounting.

C. Information relating to credit risk of financial assets at fair value through profit or loss is provided

in Note 12(2).

Contract Period

Foreign exchange swap contract (12 items) USD 91,000 thousand 2019.06.05~2019.07.10

Foreign exchange contract-buy (10 items) USD 34,370 thousand 2018.09.13~2020.06.11

Merchandise exchange contract (2 items) USD 1,203 thousand 2019.05.13~2019.08.22

June 30, 2019

Contract Amount

(notional principal)

Contract Period

Foreign exchange swap contract (1 item) THB 69,250 thousand 2018.05.18~2019.05.22



Merchandise exchange contract (3 items) USD 3,580 thousand 2018.10.31~2019.03.29

December 31, 2018

Contract Amount


Contract Period

Foreign exchange swap contract (1 item) THB 69,250 thousand 2018.05.18~2019.05.22



June 30, 2018

Contract Amount


~25~

(3) Financial assets at fair value through other comprehensive income

A. The Group has elected to classify investments that are considered to be strategic investments or

steady dividend income as financial assets at fair value through other comprehensive income.

B. Amounts recognized in profit or loss and other comprehensive income in relation to the financial

assets at fair value through other comprehensive income are listed below:


Current items:

Debt instruments

Corporate bonds 27,461$ 26,953$ 68,226$

Valuation adjustment 170)( 175)( 4,031)(

27,291 26,778 64,195

Equity instruments

Listed stocks 310,746 349,894 532,676

Valuation adjustment 191,313 123,655 19,406

502,059 473,549 552,082

529,350$ 500,327$ 616,277$

Non-current items:

Equity instruments

Unlisted shares 919,435$ 919,414$ 759,956$

Valuation adjustment 151,026)( 130,803)( 115,894)(

768,409$ 788,611$ 644,062$

2019 2018

Equity instruments at fair value through


Fair value change recognized in other

comprehensive income 11,123$ 595)($

Cumulative losses reclassified to

retained earnings due to derecognition 319)($ -$

Debt instruments at fair value through



comprehensive income 35)($ 151)($

Exchange loss recognised in profit or loss 112)($ 374)($

Interest income recognised in profit or loss 262$ 1,665$


~26~

C. Information relating to credit risk of financial assets at fair value through other comprehensive

income is provided in Note 12(2).

(4) Financial assets at amortised cost

A. The Group has no financial assets at amortised cost pledged to others as collateral.

B. As at June 30, 2019, December 31, 2018 and June 30, 2018, without taking into account any

collateral held or other credit enhancements, the maximum exposure to credit risk in respect of

the amount that best represents the financial assets at amortised cost held by the Group was

$72,903, $370,331 and $219,509, respectively.

(5) Notes and accounts receivable

For the long-term receivables due in one year, please refer to Notes 6 (11), 12 (2) C. (b) for detailed

information.

2019 2018

Equity instruments at fair value through



comprehensive income 47,978$ 30,180$

Cumulative losses reclassified to

retained earnings due to derecognition 2,367)($ -$

Debt instruments at fair value through


Fair value change recognised in other

comprehensive income 4$ 218$

Exchange gain recognised in profit or loss 508$ 188$

Interest income recognised in profit or loss 529$ 4,592$



Current items:

Time deposits with maturity

over three months 72,903$ 370,331$ 219,509$


Notes receivable 109,923$ 75,006$ 126,932$

Accounts receivable 4,456,253 8,839,281 3,880,406

Long-term receivables due

in one year 284,357 278,646 273,183

Less: Allowance for bad debts 25,850)( 25,595)( 73,661)(

4,824,683$ 9,167,338$ 4,206,860$

~27~

A. The ageing analysis of notes receivable and accounts receivable that were past due but not

impaired is as follows:

The above analysis is calculated based on past due date.

B. As of June 30, 2019, December 31, 2018, June 30, 2018 and January 1, 2018, the balances of

receivables (including notes receivable) from contracts with customers amounted to $4,540,327,

$8,888,692, $3,933,677 and $5,090,821, respectively.

(6) Prepayments

(7) Investments accounted for under the equity method


Up to 30 days 3,968,785$ 6,504,537$ 2,828,640$

31 to 90 days 273,531 1,956,758 937,760

91 to 180 days 203,121 218,242 137,028

Over 180 days 379,246 487,801 303,432

4,824,683$ 9,167,338$ 4,206,860$


Prepayment for materials 3,703,191$ 2,581,564$ 3,515,135$

Prepayment for construction

in progress 337,119 480,547 161,235

Others 1,251,257 1,191,784 1,453,171

5,291,567$ 4,253,895$ 5,129,541$

2019 2018

At January 1 3,680,933$ 3,627,018$

Addition of investments accounted for using

equity method - 27,500

Loss on disposal of investments accounted for

using equity method 219,336)( -

Share of profit or loss of investments accounted

for using equity method 208,525)( 17,997)(

Earnings distribution of investments accounted

for under equity method 63,455)( 72,063)(

Changes in other equity items 14,149)( 18,435

At June 30 3,175,468$ 3,582,893$

~28~

A. Associates

(a) The basic information of the associates that are material to the Group is as follows:

(b) The summarized financial information of the associates that are material to the Group is as

follows:

Balance sheet

Associates: June 30, 2019 December 31, 2018 June 30, 2018

Pan Asia Corp. 220,865$ 526,590$ 529,012$

Powertec Energy Corp. 1,038,147 1,227,090 1,370,557

Boretech Resource Recovery

Engineering Co., Ltd.

(Cayman) 441,243 438,252 449,437

MIE Industrial SDN. BHD 575,565 556,704 487,030

Blue Whale Water

Technology Co., Ltd. 399,109 434,937 392,019

EVER ECOVE Corp. 294,998 295,971 -

HDEC-CTCI (Linhai)

Corporation 205,541 201,389 -

Joint ventures:

ECOVE Solar Energy

Corporation - - 354,838

3,175,468$ 3,680,933$ 3,582,893$

Company

name

Principal

place

of business

June 30,

2019

December

31, 2018

June 30,

2018

Nature of

relationship

Method of

measurement

Powertec

Energy Corp.

Taiwan 16.03% 16.03% 16.03% Associates Equity method

Shareholding ratio


Current assets 679,234$ 1,636,879$ 2,312,251$

Non-current assets 22,284,913 20,905,041 20,070,623

Current liabilities 689,243)( 707,663)( 485,697)(

Non-current liabilities 12,162,435)( 10,572,795)( 9,679,985)(

Total net assets 10,112,469$ 11,261,462$ 12,217,192$

Share in associate's

net assets 1,621,029$ 1,805,212$ 2,307,828$

Carrying amount of the

associate 1,038,147$ 1,227,090$ 1,370,557$

Powertec Energy Corp.

~29~

Statement of comprehensive income

(c) The carrying amount of the Group’s interests in all individually immaterial associates and the

Group’s share of the operating results are summarized below:

As of June 30, 2019, December 31, 2018 and June 30, 2018, the carrying amount of the

Group’s individually immaterial associates amounted to $2,137,321, $2,453,843 and

$1,857,498, respectively.

(d) In August 2018, the Board of Directors during its meeting resolved to jointly establish Ever

Ecove Corporation with Evergreen Steel Corporation, and the investment amount is $300,000,

representing 30,000,000 shares, equivalent to 30% of equity.

(e) In September 2018, the Board of Directors during its meeting resolved to jointly establish

HDEC-CTCI (Linhai) Corporation with Hsin Dar Environment Corp., and the investment

amount is $202,500, representing 20,250,000 shares, equivalent to 45% of equity.

(f) In May 2019, the Board of Directors during its meeting resolved to dispose 19,580,000 shares

of Pan Asia Corp. totaling $224,494, of which $5,158 was recognized as gain on disposal of

investments (shown as other gains and losses).

(g) The above investments accounted for using the equity method were not reviewed by

independent accountants as of June 30, 2019 and 2018.

2019 2018

Revenue -$ -$

Total comprehensive loss 608,202)($ 356,087)($

2019 2018

Revenue -$ -$

Total comprehensive loss 1,178,861)($ 602,412)($





2019 2018

Total comprehensive income 320,035$ 49,941$

2019 2018




~30~

(h) The above investments accounted for using the equity method, Pan Asia Corp., Powertec

Energy Corp., Blue Whale Water Technology Co. Ltd., EVER ECOVE Corp., and HDEC-

CTCI (Linhai Corporation), were recognized based on the financial statements which have

been audited by other auditors as of December 31, 2018.

B. Joint venture

(a) The basic information of the joint ventures that are material to the Group is as follows:

(b) The summarized financial information of the joint ventures that are material to the Group is

as follows:

Balance sheet

Shareholding ratio

Company

name

Principal

place

of business June 30, 2018

Nature of

relationship

Method of

measurement

ECOVE

Solar Energy

Corporation

Taiwan 50.00% Joint

ventures

Equity

method

ECOVE Solar Energy Corporation

June 30, 2018

Cash and cash equivalents 30,793$

Other current assets 443,769

Current assets 474,562

Non-current assets 930,991

Total assets 1,405,553$

Current financial liabilities 319,826$

Other current liabilities 23,846

Current liabilities 343,672

Non-current liabilities 352,181

Total liabilities 695,853$

Total net assets 709,700$

Share in associate's net assets 354,850$

Carrying amount of the associate 354,838$

~31~

Statement of comprehensive income

C. Explanation for holding ECOVE Solar Energy Corporation shares:

(a) The Group holds 50% equity in the joint venture - ECOVE Solar Energy Corporation and its

main activity is environmental engineering.

(b) The Board of Directors had resolved to invest in ECOVE Solar Energy Corporation, in March

2018. The Group invested in ECOVE Solar Energy Corporation amounting to $27,500.

(c) On September 20, 2018, the Group acquired 50% equity interest of ECOVE Solar Energy

Corporation by cash, which became a subsidiary whose 100% equity was indirectly held by

the Group. The acquiree was consolidated into financial statements from the date of acquisition.

Please refer to Note 6(31) for further information.

For the three-month For the six-month

period ended period ended

June 30, 2018 June 30, 2018

Revenue 17,083$ 29,543$

Depreciation and amortization 5,376)($ 10,752)($

Interest income 86$ 238$

Interest expense 1,697)($ 3,418)($

Profit before income tax 13,656$ 26,947$



Other comprehensive income-net of tax 16,140 8,538


ECOVE Solar Energy Corporation

~32~

(8) Property, plant and equipment

Land

Buildings and

structures Machinery

Transportation

equipment

Office

equipment

Unfinished

construction and

prepayments

for equipment Others Total

At January 1, 2019

Cost 5,519,050$ 4,254,061$ 2,853,926$ 262,446$ 239,739$ 290,187$ 771,729$ 14,191,138$

Accumulated depreciation - 1,777,331)( 936,086)( 206,580)( 230,037)( - 609,068)( 3,759,102)(

5,519,050$ 2,476,730$ 1,917,840$ 55,866$ 9,702$ 290,187$ 162,661$ 10,432,036$

Six-month period ended

June 30, 2019

Opening net book amount 5,519,050$ 2,476,730$ 1,917,840$ 55,866$ 9,702$ 290,187$ 162,661$ 10,432,036$

Additions 20 114,559 35,633 3,474 1,093 260,940 8,188 423,907

Disposals - - 3,281)( - 72)( - 569)( 3,922)(

Depreciation charge - 64,055)( 97,865)( 9,403)( 2,284)( - 47,651)( 221,258)(

Reclassifications - - 161,464 - - 116,731)( - 44,733

Net exchange differences 4,958 15,025 7,464 279 89 601 2,167 30,583

Closing net book amount 5,524,028$ 2,542,259$ 2,021,255$ 50,216$ 8,528$ 434,997$ 124,796$ 10,706,079$

At June 30, 2019

Cost 5,524,028$ 4,368,620$ 3,042,742$ 265,920$ 240,760$ 434,997$ 779,348$ 14,656,415$

Accumulated depreciation - 1,826,361)( 1,021,487)( 215,704)( 232,232)( - 654,552)( 3,950,336)(

5,524,028$ 2,542,259$ 2,021,255$ 50,216$ 8,528$ 434,997$ 124,796$ 10,706,079$

~33~

A. The Group had no borrowing costs capitalized for the six-month periods ended June 30, 2019 and 2018.

B. Please refer to Note 8 for the details of pledged property, plant and equipment.

Land

Buildings and

structures Machinery

Transportation

equipment

Office

equipment

Unfinished

construction and

prepayments

for equipment Others Total

At January 1, 2018

Cost 3,357,596$ 4,396,599$ 961,309$ 244,873$ 238,180$ 45,951$ 750,426$ 9,994,934$


3,357,596$ 2,776,277$ 134,947$ 57,143$ 13,051$ 45,951$ 275,151$ 6,660,116$


June 30, 2018

Opening net book amount 3,357,596$ 2,776,277$ 134,947$ 57,143$ 13,051$ 45,951$ 275,151$ 6,660,116$

Additions - 3,085 28,650 3,735 1,064 27,025 15,868 79,427

Acquired from business

acquisition 61,000 516 6,559 129 - - 288 68,492

Disposals - 159,010)( 150)( - 77)( - 353)( 159,590)(

Depreciation charge - 65,964)( 31,808)( 9,484)( 1,472)( - 68,788)( 177,516)(

Reclassifications - 113)( 614 - 624)( 900)( 1,023 -

Net exchange differences 333 1,588 149 241 232)( 49 526)( 1,602

Closing net book amount 3,418,929$ 2,556,379$ 138,961$ 51,764$ 11,710$ 72,125$ 222,663$ 6,472,531$

At June 30, 2018

Cost 3,418,929$ 4,086,083$ 993,952$ 248,737$ 244,633$ 72,125$ 766,409$ 9,830,868$


3,418,929$ 2,556,379$ 138,961$ 51,764$ 11,710$ 72,125$ 222,663$ 6,472,531$

~34~

(9) Leasing arrangements－lessee

A. The Group leases various assets including land, buildings, business vehicles, multifunction

printers. Rental contracts are typically made for periods of 1 to 28 years. Lease terms are

negotiated on an individual basis and contain a wide range of different terms and conditions. The

lease agreements do not impose covenants, but leased assets may not be used as security for

borrowing purposes.

B. The carrying amount of right-of-use assets and the depreciation charge are as follows:

C. For the three-month and six-month periods ended June 30, 2019, the additions to right-of-use

assets were $47,788 and $48,899, respectively.

D. The information on income and expense accounts relating to lease contracts is as follows:

E. For the six-month period ended June 30, 2019, the Group’s total cash outflow for leases was

$105,999.

June 30, 2019

Carrying amount

Land 197,206$

Buildings 80,350

Transportation equipment (Business vehicles) 54,221

Office equipment (Photocopiers) 35,398

Other equipment 38,780

405,955$

For the three-month

period ended

For the six-month

period ended

June 30, 2019 June 30, 2019

Depreciation charge Depreciation charge

Land $ 9,290 $ 16,999

Buildings 12,294 17,958

Transportation equipment (Business vehicles) 8,087 13,807

Office equipment (Photocopiers) 3,425 7,008

Other equipment 2,204 3,698

35,300$ 59,470$

For the six-month

period ended

June 30, 2019

Items affecting profit or loss

Interest expense on lease liabilities $ 1,186

Expense on short-term lease contracts 149,657

Expense on leases of low-value assets 517

Expense on variable lease payments 10,268

~35~

F. Variable lease payments:

(a) The Group's lease contract contains a variable lease payment term that is linked to the amount

of electricity generated by solar energy. Changes in variable lease payments are recognized as

expense in the period specified in the contract.

(b) A 1% increase in the electricity generated from solar energy would increase total lease

payments by approximately 1% in accordance with the lease contract.

(10) Investment property

Buildings and

Land structures Total

At January 1, 2019

Cost 718,428$ 126,572$ 845,000$

Accumulated depreciation - 36,871)( 36,871)(

718,428$ 89,701$ 808,129$


June 30, 2019

Opening net book amount 718,428$ 89,701$ 808,129$

Depreciation charge - 2,153)( 2,153)(

Closing net book amount 718,428$ 87,548$ 805,976$

At June 30, 2019

Cost 718,428$ 126,572$ 845,000$


718,428$ 87,548$ 805,976$

Buildings and

Land structures Total

At January 1, 2018

Cost 718,428$ 126,572$ 845,000$


718,428$ 94,224$ 812,652$


June 30, 2018

Opening net book amount 718,428$ 94,224$ 812,652$

Depreciation charge - 2,262)( 2,262)(

Closing net book amount 718,428$ 91,962$ 810,390$

At June 30, 2018

Cost 718,428$ 126,572$ 845,000$


718,428$ 91,962$ 810,390$

~36~

A. Rental income from the lease of the investment property and direct operating expenses arising

from the investment property are shown below:

B. The fair value of the investment property held by the Group as at June 30, 2019 and 2018 were

$906,867 and $820,372, respectively, which are based on the real estate market transaction price.

Also, the fair value as at December 31, 2018 was $930,000, which was valued by independent

valuers. Valuations were made using the income approach with key assumptions as follows:

C. Information about the investment property that was pledged to others as collateral is provided in

Note 8.

2019 2018

Rental income from investment property 7,838$ 7,838$

Direct operating expenses arising from the

investment property that generated rental

income in the period 1,076$ 1,131$


investment property that did not generate

rental income in the period -$ -$

2019 2018

Rental income from investment property 15,641$ 15,641$


investment property that generated rental

income in the period 2,153$ 2,262$


investment property that did not generate

rental income in the period -$ -$



December 31, 2018

Gross margin 2.55%

Growth rate 1%~1.5%

Discount rate 3.30%

~37~

(11) Other non-current assets

A. Long-term receivables:

The Group contracted with the government (grantor) a service concession arrangement. The

consideration receivable from the grantor in respect of the service concession arrangement is

recognized at its fair value. Such consideration is recognized as a financial asset based on the

way of the consideration from the grantor to the operator being made as specified in the

arrangement. The consideration receivable from the grantor is recognized as accounts receivable

if it is expected to be realized within 12 months after the balance sheet date (please refer to Note

6(4)), and is recognized as long-term accounts receivable if it is expected to be realized more

than 12 months after the balance sheet date. The major terms of the arrangement are as follows:

(a) The subsidiary, ECOVE Wujih Energy Corp., obtained the operation for the construction of

Wujih Refuse Incineration Plant by build - operate - transfer (BOT) mode since April, 2000.

In September, 2000, the “Taichung City waste incineration, commission contract” between

ECOVE Wujih Energy Corp., and Taichung Government had been signed. The operating

period is for 20 years starting from September 6, 2004. However, according to the contract,

if it is expired in advance or extended during construction or operation, duration of the

operation will be deemed to be matured or extended, but not to exceed 50 years. In order to

work the “Waste Incineration Taichung City Commission Contract”, ECOVE Wujih Energy

Corp., obtained the land-use right that has continued for 20 years since the plant began

operation.

(b) The subsidiary, ECOVE Miaoli Energy Corp., obtained the operation for the construction of

Miaoli County Refuse Incineration Plant by build - operate - transfer (BOT) mode since

August, 2002. In September, 2002, the “Waste Incineration Commission Contract” between

ECOVE Miaoli Energy Corp., and Miaoli County Government had been signed. The

operating period is for 20 years starting from February 29, 2008. However, according to the

contract, if it is expired in advance or extended during construction or operation, duration of

the operation will be deemed to be matured or extended. In order to work the “Waste

Incineration Miaoli County Commission Contract”, ECOVE Miaoli Energy Corp., obtained


Long-term receivables 2,603,802$ 2,670,985$ 2,626,881$

Less: Long-term receivables

due in one year 284,357)( 278,646)( 273,183)(

2,319,445 2,392,339 2,353,698

Long-term prepaid rent - 37,897 40,309

Restricted bank deposits 172,013 188,619 16,315

Refundable deposits 138,729 130,167 133,135

Prepayments for business 882,355 546,344 40,500

Air pollution fee 54,267 54,267 54,267

Others 241,169 218,899 150,370

3,807,978$ 3,568,532$ 2,788,594$

~38~

the land-use right of Miaoli Refuse Incineration Plant. Therefore, duration of the land – use

right is from September 13, 2002 to March 12, 2026.

(c) ECOVE Wujih Energy Corp., and Fortune Energy Corp. need to comply with the guarantee

tonnage of waste from government according to the contract during construction or operation.

(d) Per service cost is calculated and adjusted based on the “Waste Incineration Commission

Contract”, “Index of average regular earnings of employees-manufacturing” and “Consumer

price index”.

B. Long-term prepaid rents were according to the “BOT Agreement” due to the land-use rights

obtained by ECOVE Wujih Energy Corp., and ECOVE Miaoli Energy Corp. and transferred to

right-of-use assets for applying IFRS16 from January 1, 2019.

C. Information about the restricted bank deposits and refundable deposits that were pledged to

others as collateral is provided in Note 8.

D. Information about the air pollution fee is provided in Note 9(7).

(12) Short-term borrowings

Note 1: ECOVE Solvent Recycling Corporation has committed that upon completion of if the

construction, ECOVE Solvent Recycling Corporation will complete the registration of

ownership on the construction and pledge with the basement of construction in first priority

to Chang Hwa Bank.

Note 2: Properties pledged by subsidiary - CTCI Development Corp., and were guaranteed and

endorsed by the Company.

Type of borrowing June 30, 2019 Interest rate range Collateral

Unsecured borrowings 8,357,092$ 0.68%~8.25% -Secured borrowings 2,039,150 1.24%~1.7% Notes 1 and 2

10,396,242$

Type of borrowing December 31, 2018 Interest rate range Collateral

Unsecured borrowings 11,287,309$ 0.68%~8.05% -Secured borrowings 2,127,150 1.04%~1.24% Properties pledged by

subsidiary-CTCI

Development Corp. and

time deposits of USD

4,560 thousand

mortgaged to banks,

and all were guaranteed

and endorsed by the

Company

13,414,459$

~39~

(13) Accounts payable

(14) Other payables

Note: Payables on land purchases arise from the payment that the subsidiary, CTCI Development

Corp. purchases the land.

(15) Other current liabilities

Joint venture represents the excess of accumulated cost over the accumulated capital injection and

bills.

Type of borrowing June 30, 2018 Interest rate range Collateral

Unsecured borrowings 8,047,275$ 0.65%~7.8% -


Materials payable 4,592,619$ 4,743,519$ 2,883,908$

Sub-contract costs payable 4,664,584 4,818,197 5,077,160

Maintenance costs payable 253,918 281,003 424,917

Equipment buying costs payable 60,660 36,861 32,058

Others 92,285 111,682 192,084

9,664,066$ 9,991,262$ 8,610,127$


Accrued payroll 947,440$ 1,664,616$ 967,532$

Accrued employees’

compensation, directors’

and supervisors’ remuneration 153,812 148,763 211,753

Accrued insurance 70,226 83,359 55,832

Accrued pension 40,375 33,206 20,460

Dividends payable 2,113,814 - 2,844,131

Payables on land purchases

(Note) - 1,785,960 -

Others 762,903 976,612 558,527

4,088,570$ 4,692,516$ 4,658,235$


Joint venture 2,938,901$ 7,323,938$ 3,344,175$

Long-term borrowings -

current portion 195,764 128,268 266,617

Receipts in advance 23,132 161,659 83,311

Others 72,051 36,795 81,155

3,229,848$ 7,650,660$ 3,775,258$

~40~

(16) Long-term borrowings

Type of borrowings

Borrowing period

and repayment term

Interest

rate range Collateral

Financing

amount June 30, 2019 December 31, 2018 June 30, 2018

Subsidiary - ECOVE Miaoli

Energy Corp.

Mega International

Commercial Bank

secured borrowings (Note 1)

Borrowing period is

from November 2010

to April 2019; interest

is payable monthly.

1.3875%

~1.3915%

Machineries and other

equipment

constructed or

acquired

523,200$ -$ 4,000$ 92,000$

Subsidiary - ECOVE Solvent

Recycling Corp.

Chang Hwa Bank

secured borrowings (Note 2)

Borrowing period is

from September 2014

to September 2021;

interest is payable

monthly.

2.3%

~2.47%

Land and buildings

and structures

29,500 - 25,645 27,600

Subsidiary - ECOVE Solar

Energy Corporation

The Shanghai Commercial &

Savings Bank, Ltd.

secured borrowings

Borrowing period is

from June 2018 to

June 2033; Principal

and interest are

payable monthly.

1.7% ECOVE Solar Energy

Corporation issued a

promissory note of

$302,760 thousand,

which is guaranteed

by ECOVE

Environment Corp.

310,000 293,559 302,755 -


Energy Corporation

KGI Bank

secured borrowings

Borrowing period is

from May 2015 to

May 2021; Principal

and interest are

payable monthly.



promissory note of

$152,690 thousand,

which is guaranteed

by ECOVE

Environment Corp.

220,000 142,196 151,191 -

~41~

Type of borrowings

Borrowing period

and repayment term

Interest


Financing



Energy Corporation

Chang Hwa Bank

secured borrowings

Borrowing period is

from June 2016 to

August 2030;

principal and interest

are payable monthly.

1.89%~

2.14%

Guaranteed by ECOVE

Environment Corp.

155,000$ 135,249$ 141,124$ -$


Power Corporation

First Bank

secured borrowings

Borrowing period is

from January 2014 to

May 2030; principal

and interest are

payable monthly.



promissory note of

$81,760 thousand, which

is guaranteed by ECOVE

Solar Energy Corporation

108,000 74,362 77,794 -


Power Corporation

Bank SinoPac

secured borrowings

Borrowing period is

from August 2014 to

August 2030;



1.57%~

1.62%

ECOVE Solar Power


promissory note of




149,800 112,812 118,360 -


Power Corporation

Bank SinoPac

secured borrowings

Borrowing period is

from August 2018 to

August 2023;



1.49%~

1.62%

〃 280,000 221,492 226,996 -


Power Corporation

Bank SinoPac

secured borrowings

Borrowing period is

from March 2019 to

June 2024; principal

and interest are

payable monthly.

1.49% ECOVE Solar Power


promissory note of



Environment Corp.

217,000 185,700 - -

~42~

Type of borrowings

Borrowing period

and repayment term

Interest


Financing



Power Corporation

Hua Nan Bank

secured borrowings

Borrowing period is

from June 2015 to

June 2030; principal

and interest are

payable monthly.



promissory note of




38,430$ 23,370$ 24,423$ -$


Power Corporation

Far Eastern International Bank

Co., Ltd.

secured borrowings

Borrowing period is

from September 2015

to September 2020;

principal is payable

seasonally, and

interest is payable

monthly.



promissory note of $27

million, which is

guaranteed by ECOVE


27,000 3,400 4,480 -


Power Corporation

KGI Bank

secured borrowings

Borrowing period is

from November 2017

to November 2032;



1.9862%~

1.9877%

ECOVE Solar Power



million, which is

guaranteed by ECOVE


100,000 78,197 81,113 -

~43~

Type of borrowings

Borrowing period

and repayment term

Interest


Financing


Subsidiary - ECOVE Central

Corporation Ltd.

Bank SinoPac

secured borrowings

Borrowing period is

from December 2018

to December 2023;



1.6%~

1.616%

ECOVE Central

Corporation Ltd. issued a


million, which is

guaranteed by ECOVE


16,000$ 15,200$ 16,000$ -$

Subsidiary - ECOVE South

Corporation Ltd.

Bank SinoPac

secured borrowings

Borrowing period is

from December 2018

to December 2023;



1.6% ECOVE South

Corporation Ltd. issued a


million, which is

guaranteed by ECOVE


14,000 13,300 14,000 -

Subsidiary - LUMBERTON

SOLAR

Bank SinoPac

secured borrowings

Borrowing period is

from September 2017

to August 2023;



4.9023%~

5.029%

ECOVE Solar Energy


promissory note of

US$14,640 thousand and

US$11,910 thousand at

December 31, 2018 and

June 30, 2019,

respectively, which is

guaranteed by ECOVE


454,556 354,540 363,973 -

~44~

Note 1: ECOVE Miaoli Energy Corp. commited to maintain the following financial ratios and criteria during the period of the contract:

a. Current ratio (current assets + restricted assets provided as a compensation for the credit loan)/current liabilities: More than 100%

b. Liability ratio (total liabilities/ net equity): Less than 190%.

c. Interest coverage ratio ((income before tax + interest expense) / interest expense): At least 150%.

Note 2: ECOVE Solvent Recycling Corporation committed that if the construction has been completed, ECOVE Solvent Recycling Corporation will

complete the registration of ownership on the construction and pledge with the basement of construction in first priority to Chang Hwa Bank.

Type of borrowings

Borrowing period

and repayment term

Interest


Financing


Subsidiary - CTCI

Development Corporation

KGI Bank

secured borrowings

Borrowing period is

from January 2019 to

December 2048;

interest is payable

monthly, and principal

is payable

semiannually after

grace period.

1.36378%~

1.36522%

Land and buildings and

structures

3,700,000$ 1,965,960$ -$ -$

Subsidiary - CTCI

Development Corporation

Taiwan Cooperative Bank

secured borrowings

Borrowing period is

from April 2009 to

April 2029; interest is

payable monthly, and

principal is payable

semiannually.

1.3504% Land and buildings and

structures

3,600,000 - - 2,001,150

Less: Current portion 195,764)( 128,268)( 266,617)(

3,423,573$ 1,423,586$ 1,854,133$

~45~

(17) Other non-current liabilities

Note: Deferred revenue is a cash grant received from New Jersey government since Lumberton

builds and operates a solar power station in New Jersey. The construction period of the solar

power station is 15 years.

(18) Pensions

A. Defined benefit pension plan

(a) The Company and its domestic subsidiaries have a defined benefit pension plan in

accordance with the Labor Standards Law, covering all regular employees’ service years prior

to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of

employees who chose to continue to be subject to the pension mechanism under the Law.

Under the defined benefit pension plan, two units are accrued for each year of service for the

first 15 years and one unit for each additional year thereafter, subject to a maximum of 45

units. Pension benefits are based on the number of units accrued and the average monthly

salaries and wages of the last 6 months prior to retirement. The Company contributes monthly

an amount equal to 6.5% of the employees’ monthly salaries and wages to the retirement fund

deposited with Bank of Taiwan, the trustee, under the name of the independent retirement

fund committee. Also, the Company would assess the balance in the aforementioned labor

pension reserve account by the end of December 31, every year. If the account balance is

insufficient to pay the pension calculated by the aforementioned method to the employees

expected to qualify for retirement in the following year, the Company will make

contributions to cover the deficit by next March.

(b) For the aforementioned pension plan, the Group recognized pension cost of $10,816, $13,639,

$21,655 and $27,702 for the three-month and six-month periods ended June 30, 2019 and

2018, respectively.

(c) Expected contributions to the defined benefit pension plans of the Group for the year ending

December 31, 2020 amount to $86,581.


Net defined benefit liabilities 1,511,544$ 1,847,269$ 1,880,353$

Deposits received 336,382 407,649 378,517

Accrued recovery costs 97,708 98,932 98,687

Deferred revenue (Note) 164,873 169,741 -

Others 70,645 92,101 77,013

2,181,152$ 2,615,692$ 2,434,570$

~46~

B. Defined contribution pension plan

(a) Effective July 1, 2005, the Company and its domestic subsidiaries have established a defined

contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”),

covering all regular employees with R.O.C. nationality. Under the New Plan, the Company

and its domestic subsidiaries contribute monthly an amount based on 6% of the employees’

monthly salaries and wages to the employees’ individual pension accounts at the Bureau of

Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of

employment.

(b) The pension costs under the defined contribution pension plans of the Group for the three-

month and six-month periods ended June 30, 2019 and 2018 were $51,380, $51,170,

$103,228 and $101,817, respectively.

(c) Some overseas subsidiaries adopted a defined contribution pension plan, covering all regular

employees. Appropriation of pension cost for the three-month and six-month periods ended

June 30, 2019 and 2018 were $25,549, $22,570, $57,503 and $44,174, respectively.

(19) Share-based payment - employee compensation

A. The Company

(a) For the six-month periods ended June 30, 2019 and 2018, the Company’s share-based

payment arrangements were as follows:

Type of arrangement Grant date

Quantity

granted

Contract

period

Vesting

conditions

Fifth plan of employee

stock options

2017.04.11 20,000 units 6 years Service of 2 to

4 years

Sixth plan of employee

stock options


4 years

Seventh plan of

employee stock options


4 years

~47~

(b) The above employee stock options are set forth below:

i. Details of the fifth plan of employee stock options outstanding as of June 30, 2019 and

2018 are set forth below:

ii. Details of the sixth plan of employee stock options outstanding as of June 30, 2019 and


No. of units

Weighted-

average No. of units

Weighted-

average

(shares in exercise price (shares in exercise price

Stock options thousands) (in dollars) thousands) (in dollars)

Options outstanding

at beginning of period 18,328.55 NT$49.60 19,125.30 NT$49.60

Options granted - - - -

Options waived 388.11)( - 426.78)( -

Options exercised 36.15)( NT$49.60 - -

Options outstanding

at end of period 17,904.29 NT$49.60 18,698.52 NT$49.60

Options exercisable

at end of period 7,485.45 NT$49.60 - -


2019 2018

No. of units

Weighted-


Weighted-

average



Options outstanding

at beginning of period 19,294.54 NT$45.90 - -

Options granted - - 20,000.00 NT$45.90

Options waived 469.32)( - 298.55)( -

Options revoked - - - -

Options outstanding

at end of period 18,825.22 NT$45.90 19,701.45 NT$45.90

Options exercisable

at end of period - - - -


2019 2018

~48~

iii. Details of the seventh plan of employee stock options outstanding as of June 30, 2019 is

set forth below:

(c) The weighted-average stock price of stock options at exercise dates for the six-month period

ended June 30, 2019 was NT$46.40.

(d) As of June 30, 2019, December 31, 2018 and June 30, 2018, the range of exercise prices of

stock options outstanding were NT$45.90~NT$49.60; the weighted-average remaining

contractual period was as follows:

(e) The fair value of stock options is measured using the Black-Scholes option-pricing model.

Relevant information is as follows:

No. of units

Weighted-

average

(shares in exercise price

Stock options thousands) (in dollars)

Options outstanding

at beginning of period - -

Options granted 20,000.00 NT$48.90

Options waived 357.44)( -

Options revoked - -

Options outstanding

at end of period 19,642.56 NT$48.90

Options exercisable

at end of period - -

For the six-month period ended June 30, 2019

Type of arrangement June 30, 2019 December 31, 2018 June 30, 2018


stock options

4~5 years 4~5 years 4~5 years


stock options

4~5 years 4~5 years 4~5 years

Seventh plan of

employee stock options

4~5 years-

-

Type of

arrangement

Grant

date

Stock

price

(in dollars)

Exercise

price

(in dollars)

Expected

price

volatility

Expected

option

life

Expected

dividends

Risk free

interest

rate

Fair value

per unit

(in dollars)

Fifth plan of

employee stock

options

2017.4.11 NT$ 52.2 NT$ 52.2 28.06%~

29.05%

4~5

years

0% 0.80%~

0.89%

NT$12.19~

NT$14.17

Sixth plan of

employee stock

options

2018.3.9 NT$ 45.9 NT$ 45.9 24.96%~

26.37%

4~5

years

0% 0.63%~

0.72%

NT$ 9.56~

NT$11.29

Seventh plan of

employee stock

options

2019.3.8 NT$ 48.9 NT$ 48.9 22.88%~

23.56%

4~5

years

0% 0.64%~

0.67%

NT$ 9.38~

NT$10.82

~49~

(f) For the three-month and six-month periods ended June 30, 2019 and 2018, expense

recognized arising from share-based payment amounted to $41,507, $29,370, $73,170 and

$49,627, respectively.

B. Subsidiary – CTCI Advanced System Inc.

(a) For the six-month periods ended June 30, 2019 and 2018, the subsidiary’s share-based

payment transactions are set forth below:


i. Details of the sixth plan of employee stock options outstanding as of June 30, 2019 and

2018 are set forth below

Type of arrangement Grant date

Quantity

granted

Contract

period

Vesting

conditions


stock options

2018.03.23 600 units 6 years Service of

2 to 4 years

Seventh plan of employee

stock options

2019.03.08 600 units 6 years Service of

2 to 4 years

No. of units

Weighted-


Weighted-

average



Options outstanding

at beginning of period 583.00 NT$44.00 - -

Options granted - - 600.00 NT$46.85

Options waived 15.00)( - 3.00)( -


Options outstanding

at end of period 568.00 NT$44.00 597.00 -

Options exercisable



2019 2018

~50~

ii. Details of the seventh plan of employee stock options outstanding as of June 30, 2019 and


(c) For the six-month periods ended June 30, 2019 and 2018, no stock options had been executed.

(d) As of June 30, 2019, December 31, 2018 and June 30, 2018, the exercise price of stock

options outstanding were NT$42.20~NT$44.00, NT$46.85 and NT$ 46.85, respectively. The

weighted-average remaining contractual period were 4.75~5.75 years, 0～5.25 years and 0

～5.75 years, respectively.



(f) For the three-month and six-month periods ended June 30, 2019 and 2018, the expenses

incurred on share-based payment transactions were $982, $476, $1,444 and $523,

respectively.

No. of units

Weighted-


Weighted-

average



Options outstanding

at beginning of period - - - -

Options granted 600.00 NT$42.20 - -

Options waived 6.00)( - - -


Options outstanding

at end of period 594.00 NT$42.20 - -

Options exercisable



2019 2018

Type of

arrangement

Grant

date

Stock

price

(in dollars)

Exercise

price

(in dollars)

Expected

price

volatility

Expected

option

life

Expected

dividends

Risk free

interest

rate

Fair value

per unit

(in dollars)

Sixth plan of

employee stock

options

2018.03.23 NT$46.85 NT$46.85 21.33%~

22.13%

4～5

years

0% 0.65%~

0.72%

NT$8.67~

NT$9.85

Seventh plan of

employee stock

options

2019.03.08 NT$42.20 NT$42.20 19.42%~

20.74%

4～5

years

0% 0.64%~

0.67%

NT$7.08~

NT$8.33

~51~

C. Subsidiary – ECOVE Environment Corp.

(a) For the six-month periods ended June 30, 2019 and 2018, the subsidiary’s share-based

payment transactions are set forth below:


i. Details of the fourth plan of employee stock options outstanding as of June 30, 2019 and

2018 are set forth below: all options were exercised.

Type of

arrangement Grant date Quantity granted Contract period Vesting conditions

Fourth plan of employee

stock options

2011.6.17 1,200 units 6 years Service of

2 years


stock options


2 years


stock options


2 years

No. of units

Weighted-


Weighted-

average



Options outstanding

at beginning of period - - 3.00 NT$106.30

Options waived - - 3.00)( -

Options exercised - - - -

Options outstanding


Options exercisable



2019 2018

~52~

ii. Details of the fifth plan of employee stock options outstanding as of June 30, 2019 and

2018 are set forth below: all options were exercised.

iii. Details of the sixth plan of employee stock options outstanding as of June 30, 2019 is set

forth below:

(c) The weighted-average stock price of stock options at exercise dates for the six-month periods

ended June 30, 2019 and 2018 were NT$186.13 and NT$171.85, respectively.

No. of units

Weighted-


Weighted-

average



Options outstanding

at beginning of period - - 298.25 NT$103.00

Options waived - - 3.75)( -

Options exercised - - 294.50)( NT$103.00

Options outstanding


Options exercisable



2019 2018

No. of units

Weighted-

average

(shares in exercise price

Stock options thousands) (in dollars)

Options outstanding

at beginning of period1,448.27

NT$173.50

Options waived 24.05)( -

Options exercised - -

Options outstanding at end

of period 1,424.22 NT$163.90

Options exercisable at end

of period - -


~53~

(d) As of June 30, 2019, December 31, 2018, and June 30, 2018, the range of exercise prices of

stock options outstanding were NT$163.90, NT$173.5 and NT$103~NT$106.3, respectively;

the weighted-average remaining contractual period was as follows:



(f) For the three-month and six-month periods ended June 30, 2019 and 2018, the expenses

incurred on share-based payment transactions were $2,442 and $4,966, respectively.

(20) Share capital

A. As of June 30, 2019, the Company’s authorized capital was $9,000,000 (including 800 million

shares reserved for employee stock options), and the paid-in capital was $7,633,100, consisting

of 763,310,001 shares with a par value of NT$10 per share.

Movements in the number of the Company’s ordinary shares outstanding are as follows:

Type of arrangement June 30, 2019 December 31, 2018 June 30, 2018

Fourth plan of employee

stock options

- - -


stock options

- - -


stock options

5.25 years 5.5 year -

Type of

arrangement

Grant

date

Stock

price

(in dollars)

Exercise

price

(in dollars)

Expected

price

volatility

Expected

option

life

Expected

dividends

Risk free

interest

rate

Fair value

per unit

(in dollars)

Fourth plan of

employee stock

options

2011.6.17 NT$146.0 NT$146.0 38.65% 4.50

years

0% 1.05% NT$48.82

Fifth plan of

employee stock

options

2012.6.28 NT$145.0 NT$145.0 33.63% 4.60

years

0% 1.00% NT$42.79

Sixth plan of

employee stock

options

2018.7.9 NT$173.5 NT$173.5 11.38%~

12.71%

4~5

years

0% 0.66%~

0.71%

NT$17.88~

NT22.44

2019

At January 1 763,273,848

Employee stock options exercised 36,153

At June 30 763,310,001

~54~

B. Treasury shares

(a) Reason for share reacquisition and movements in the number of the Company’s treasury

shares are as follows:

(b) Pursuant to the R.O.C. Securities and Exchange Law, the number of shares bought back as

treasury share should not exceed 10% of the number of the Company’s issued and

outstanding shares and the amount bought back should not exceed the sum of retained

earnings, paid-in capital in excess of par value and realized capital surplus.

Name of company Reason for Number of shares

holding the shares reacquisition (shares in thousands) Carrying amount

Subsidiary-ECOVE

Environmental Services

Corp.

To maintain

stockholders’

equity

1 $ 10

Subsidiary-CTCI Investment

Corp."

344 3,241

Subsidiary-CTCI Development

Corp." 912 8,584

$ 11,835



Subsidiary-ECOVE


Corp.

To maintain

stockholders’

equity

1 $ 10


Corp."

344 3,241


Corp." 912 8,584

$ 11,835



Subsidiary-ECOVE


Corp.

To maintain

stockholders’

equity

1 $ 10


Corp."

344 3,241


Corp." 912 8,584

$ 11,835

June 30, 2019

December 31, 2018

June 30, 2018

~55~

(21) Capital surplus

A. Pursuant to the R.O.C. Company Law, capital surplus arising from paid-in capital in excess of

par value on issuance of common stocks and donations can be used to cover accumulated deficit

or to issue new stocks or cash to shareholders in proportion to their share ownership, provided

that the Company has no accumulated deficit. Further, the R.O.C. Securities and Exchange Law

requires that the amount of capital surplus to be capitalized mentioned above should not exceed

10% of the paid-in capital each year. Capital surplus should not be used to cover accumulated

deficit unless the legal reserve is insufficient.

B. The details and movements of capital surplus are provided as follows:

C. Please refer to Note 6 (19) for details about the capital surplus - employee stock options.

Share premium

Treasury share

transactions

Difference

between

consideration and

carrying amount of

subsidiaries

acquired or

disposed

Employee stock

options Others Total

At January 1, 2019 2,865,969$ 5,043$ 211,172$ 453,627$ 9,242$ 3,545,053$

Employee stock options

exercised 1,316 - - - - 1,316

Share-based payment

transaction - - - 102,075 - 102,075

At June 30, 2019 $ 2,867,285 $ 5,043 $ 211,172 $ 555,702 $ 9,242 $ 3,648,444

Share premium

Treasury share

transactions

Difference

between

consideration and

carrying amount of

subsidiaries

acquired or

disposed

Employee stock

options Others Total

At January 1, 2018 2,865,969$ 5,043$ 205,931$ 309,435$ 9,242$ 3,395,620$

Employee stock options

exercised by subsidiary - - 5,315 - - 5,315

Share-based payment

transaction - - - 64,563 - 64,563

At June 30, 2018 $ 2,865,969 $ 5,043 $ 211,246 $ 373,998 $ 9,242 $ 3,465,498

~56~

(22) Retained earnings

Note: The Company has adopted the modified retrospective approach under IFRS 9. For details of

the effect as at January 1, 2018, please refer to Note 12(4) B of the consolidated financial

statements and for 2018.

A. When net profit occurs in the annual accounts, the Company may, after reserving a sufficient

amount of the income before tax to cover the accumulated losses, with the resolution of the Board

of Directors, distribute 1.5% to 5% of the income before tax to pay to the employees as

remuneration, and distribute no more than 1.5% of the income before tax to pay to the Board of

Directors as remuneration. The remuneration could be in the form of stock or cash, and the

employee remuneration could be distributed to the employees of subsidiaries of the Company

under certain conditions. A report of the distribution of employee remuneration or the Board of

Directors’ remuneration shall be submitted to the stockholders’ meeting.

B. The Company shall, after all taxes and dues have been paid and its losses have been covered and

at the time of allocating surplus profits, first set aside 10% of such profits as legal reserve.

However, when the legal reserve amounts to the authorized capital, this shall not apply.

Furthermore, in accordance with the provisions of laws and regulations and the rules prescribed

by the central competent authority, a special reserve shall be set aside. If there is recovery of the

balance of special reserve, the recovered amount shall be included in the distribution of the profit

for the current year.

The allocable profit for the current year, which is the balance after the profit distribution and

covering losses aforementioned as the preceding paragraph, together with the undistributed

retained earnings accrued from prior years shall be referred to as accumulated distributable

earnings, which shall be distributed as dividends to shareholders according to shareholders’

resolutions.

To meet the requirements in business expansion and industry growth, fulfilling future operating

needs and stabilizing financial structure is the priority of the Company's dividend policy. Thus,

the distribution of the accumulated distributable earnings is in accordance with the shareholders’

resolutions. Also, the amount of shareholders’ bonus shall not be less than 50% of accumulated

distributable earnings of the Company, and in particular cash dividends shall not be less than

20%.

2019 2018

At January 1 2,217,619$ 3,061,699$

Effect of retrospective restatement (Note) - 166,327

At January 1 (revised) 2,217,619$ 3,228,026$


Legal reserve appropriated 182,754)( 280,534)(

Cash dividends 1,721,210)( 2,468,202)(

Reversal of special reserve 1,417 2,110

Valuation adjustment transferred to retained

earnings 2,367)( -

Impact of change in tax rate - 19,951

At June 30 $ 806,242 $ 1,229,073

~57~

C. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in

proportion to their share ownership, the legal reserve shall not be used for any other purpose.

The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their

share ownership is permitted, provided that the balance of the reserve exceeds 25% of the

Company’s paid-in capital.

D. Special reserve

(a) In accordance with the regulations, the Company shall set aside special reserve from the debit

balance on other equity items at the balance sheet date before distributing earnings. When

debit balance on other equity items is reversed subsequently, the reversed amount could be

included in the distributable earnings.

(b) The amounts previously set aside by the Company as special reserve on initial application of

IFRSs in accordance with Jin-Guan-Zheng-Fa-Zi Letter No. 1010012865, dated April 6, 2012,

shall be reversed proportionately when the relevant assets are used, disposed of or reclassified

subsequently. Such amounts are reversed upon disposal or reclassified if the assets are

investment property of land, and reversed over the use period if the assets are investment

property other than land.

E. The Company’s appropriations of 2018 and 2017 earnings had been resolved at the stockholders’

meeting on May 29, 2019 and 2018, respectively. Details are summarized below:

F. The appropriation of 2018 earnings became effective on August 1, 2019, as resolved at the Board

of Director’s meeting on May 29, 2019.

G. For information relating to employees’ compensation (bonuses) and directors’ remuneration,

please refer to Note 6(28).

Amount

Dividends

per share

(in NT dollars) Amount

Dividends

per share

(in NT dollars)

Set aside as legal reserve 182,754$ -NT$ 280,534$ -NT$

Reversal of special reserve 1,417)( - 2,110)( -

Cash dividends 1,721,210 2.255 2,468,202 3.23

1,902,547$ 2.255$ 2,746,626$ 3.23$

2018 2017

~58~

(23) Operating revenue

A. Disaggregation of revenue from contracts with customers

The Group derives revenue from the transfer of goods and services over time and at a point in

time in the following major product lines and geographical regions:

2019 2018

Revenue from contracts with customers 13,079,375$ 13,186,351$

Other-service concession revenue 302,090 169,814

$ 13,381,465 $ 13,356,165

2019 2018

Revenue from contracts with customers 26,656,618$ 27,576,477$

Other-service concession revenue 437,305 320,270

$ 27,093,923 $ 27,896,747



For the three-month

period ended

June 30, 2019

Construction

Engineering

Revenue Service Revenue

Other Operating

Revenue Total

Total segment

revenue

11,502,082$ 1,092,311$ 484,982$ 13,079,375$

Inter-segment

revenue 770,008 2,678 43,676 816,362

12,272,090$ 1,094,989$ 528,658$ 13,895,737$

Revenue from

external

customer

contracts

Timing of

revenue

recognition

At a point time -$ 1,092,311$ 484,982$ 1,577,293$

Over time 11,502,082 - - 11,502,082

11,502,082$ 1,092,311$ 484,982$ 13,079,375$

~59~

For the three-month

period ended

June 30, 2018

Construction

Engineering


Other Operating

Revenue Total

Total segment

revenue

11,949,212$ 1,064,832$ 172,307$ 13,186,351$

Inter-segment

revenue 600,323 5,769 125,398 731,490

12,549,535$ 1,070,601$ 297,705$ 13,917,841$

Revenue from

external

customer

contracts

Timing of

revenue

recognition

At a point time -$ 1,064,832$ 172,307$ 1,237,139$

Over time 11,949,212 - - 11,949,212

11,949,212$ 1,064,832$ 172,307$ 13,186,351$

For the six-month

period ended

June 30, 2019

Construction

Engineering


Other Operating

Revenue Total

Total segment

revenue

23,747,085$ 2,235,433$ 674,100$ 26,656,618$

Inter-segment

revenue 1,320,050 8,178 237,896 1,566,124

25,067,135$ 2,243,611$ 911,996$ 28,222,742$

Revenue from

external

customer

contracts

Timing of

revenue

recognition

At a point time -$ 2,235,433$ 674,100$ 2,909,533$

Over time 23,747,085 - - 23,747,085

23,747,085$ 2,235,433$ 674,100$ 26,656,618$

~60~

B. Contract assets and liabilities

The Group has recognized the following revenue-related contract assets and liabilities:

For the six-month

period ended

June 30, 2018

Construction

Engineering


Other Operating

Revenue Total

Total segment

revenue

25,204,991$ 2,097,182$ 274,304$ 27,576,477$

Inter-segment

revenue 1,204,317 20,566 244,444 1,469,327

26,409,308$ 2,117,748$ 518,748$ 29,045,804$

Revenue from

external

customer

contracts

Timing of

revenue

recognition

At a point time -$ 2,097,182$ 274,304$ 2,371,486$

Over time 25,204,991 - - 25,204,991

25,204,991$ 2,097,182$ 274,304$ 27,576,477$

June 30, 2019 December 31, 2018 June 30, 2018 January 1, 2018

Contract assets-

construction contract

revenue 18,840,920$ 24,823,432$ 21,707,003$ 23,759,310$

Contract liabilities-

construction contract

revenue 14,196,426)( 13,920,198)( 12,509,386)( 13,880,106)(

4,644,494$ 10,903,234$ 9,197,617$ 9,879,204$

~61~

(24) Other income

(25) Other gains and losses

2019 2018

Interest income:

Interest income from bank deposits 73,665$ 58,204$

Rental revenue 2,700 1,089

Dividend income 128 -

Gains on reversal of bad debts - 128

Other income-others 22,166 15,263

98,659$ 74,684$

2019 2018

Interest income:

Interest income from bank deposits 131,825$ 107,931$

Rental revenue 4,257 2,611

Dividend income 230 -

Gains on reversal of bad debts - 128

Other income-others 37,745 25,263

174,057$ 135,933$



2019 2018

(Losses) gains on disposal of property, plant and

equipment 1,383)($ 66,860$

Gains on disposal of investments 5,158 64,334

Foreign exchange gains 116,335 135,281

Gains on financial assets at fair value through

profit or loss 26,063 53,524

Other gains and losses 3,616)( 34,093)(

142,557$ 285,906$

2019 2018

(Losses) gains on disposal of property, plant and

equipment 1,353)($ 66,798$

Gains on disposal of investments 5,158 64,420

Foreign exchange gains 116,729 35,208

Gains on financial assets at fair value through

profit or loss 56,214 26,136

Other gains and losses 6,327)( 37,354)(

170,421$ 155,208$



~62~

(26) Finance costs

(27) Expenses by nature

2019 2018

Interest expense

Interest on loan 41,950$ 42,492$

Interest on lease liability 568 -

42,518$ 42,492$

2019 2018

Interest expense

Interest on loan 123,389$ 79,181$

Interest on lease liability 1,186 -

124,575$ 79,181$



2019 2018

Subcontract costs 4,444,837$ 4,801,096$

Materials 4,532,180 3,967,338

Employee benefit expense 2,159,197 2,111,764

Amortisation charges on buried equipment 118,609 73,124

Temporary equipment 1,562 6,864

Depreciation charges on property, plant and

equipment 139,728 90,752

Amortisation on intangible assets 36,191 36,074

Others 1,581,278 1,885,397

13,013,582$ 12,972,409$

2019 2018

Subcontract costs 9,952,088$ 9,644,188$

Materials 8,575,287 9,293,207

Employee benefit expense 4,394,498 4,259,252

Amortisation charges on buried equipment 219,740 145,535

Temporary equipment 1,566 78,327

Depreciation charges on property, plant and

equipment 282,881 179,778

Amortisation on intangible assets 74,638 77,765

Others 2,621,112 3,118,482

26,121,810$ 26,796,534$



~63~

(28) Employee benefit expense

A. According to the Articles of Incorporation of the Company, when distributing earnings, the

Company shall distribute bonus to the employees and pay remuneration to the directors that

should be 1.5% to 5% and not be higher than 1.5%, respectively, of the total distributed amount.

B. For the three-month and six-month periods ended June 30, 2019 and 2018, employees’

compensation was accrued at ($2,863), $7,607, $8,074 and $20,122, respectively; directors’

remuneration was accrued at $4,500, $4,500, $9,000 and $9,000, respectively. The

aforementioned amounts were recognized in other expenses.

The employees’ compensation and directors’ remuneration were estimated and accrued based on

an amount of 1.5% to 5% and not higher than 1.5% of distributable profit of current period for

the six-month period ended June 30, 2019.

Employees’ compensation and directors’ remuneration for 2018 as resolved at the meeting of

Board of Directors were in agreement with those amounts recognized in the 2018 financial

statements.

Information about employees’ compensation and directors’ remuneration of the Company as

resolved at the meeting of Board of Directors will be posted in the “Market Observation Post

System” at the website of the Taiwan Stock Exchange.

2019 2018

Salaries and wages 1,792,114$ 1,790,024$

Employee stock options 97,865 39,930

Labor and health insurance fees 119,780 102,437

Pension costs 87,745 87,379

Other personnel expenses 61,693 91,994

2,159,197$ 2,111,764$

2019 2018

Salaries and wages 3,676,113$ 3,605,402$

Employee stock options 141,783 65,258

Labor and health insurance fees 253,826 240,480

Pension costs 182,386 173,693

Other personnel expenses 140,390 174,419

4,394,498$ 4,259,252$



~64~

(29) Income tax

A. Income tax expense

(a) Components of income tax expense:

(b) The income tax (charge)/credit relating to components of other comprehensive income is as

follows:

2019 2018

Current tax:

Current tax on profits for the period 211,896$ 203,375$

Prior year income tax (over) underestimation 33,830)( 4,635

Total current tax 178,066 208,010

Deferred tax:

Origination and reversal of temporary

differences 72,033)( 83,854)(

Impact of change in tax rate - -

Total deferred tax 72,033)( 83,854)(

Income tax expense 106,033$ 124,156$

2019 2018

Current tax:

Current tax on profits for the period 437,590$ 300,648$

Prior year income tax (over) underestimation 33,830)( 4,635

Total current tax 403,760 305,283

Deferred tax:

Origination and reversal of temporary

differences 164,639)( 10,300)(

Impact of change in tax rate - 16,750

Total deferred tax 164,639)( 6,450

Income tax expense 239,121$ 311,733$



2019 2018

Impact of change in tax rate -$ -$

2019 2018

Impact of change in tax rate -$ 19,379$



~65~

B. Assessment of income tax

The Company’s income tax returns through 2014 and 2016 have been assessed and approved by

the Tax Authority.

C. The Company’s subsidiary, CTCI Arabia Ltd., was ordered by the local tax authorities to pay

back taxes in the amount of $134,635 (SAR 17,212) for the years 2007 through 2010. CTCI

Arabia Ltd. has appealed the decision and paid tax beforehand in the amount of $134,635 (SAR

17,212) in order to conduct subsequent administrative litigation, therefore it is difficult to assess

the maximum possible loss that CTCI Arabia Ltd. could incur from this tax dispute.

D. Under the amendments to the Income Tax Act which was promulgated by the President of the

Republic of China on February 7, 2018, the Company’s applicable income tax rate was raised

from 17% to 20% effective from January 1, 2018. The Group has assessed the impact of the

change in income tax rate.

(30) Earnings per share

Amount

after tax

Weighted-average

number of ordinary

shares outstanding

(shares in

thousands)

Earnings per share

(in dollars)

Basic earnings per share

Profit attributable to the ordinary

shareholders of the parent272,064$ 762,016 0.36NT$

Diluted earnings per share

Assumed conversion of all

dilutive potential ordinary shares

Employees’ compensation - -

Profit attributable to ordinary

shareholders of the parent plus

assumed conversion of all

dilutive potential ordinary shares 272,064$ 762,016 0.36NT$

For the three-month period ended June 30, 2019

~66~

Amount

after tax

Weighted-average

number of ordinary

shares outstanding

(shares in

thousands)

Earnings per share

(in dollars)







Employees’ compensation - 151





Amount

after tax

Weighted-average

number of ordinary

shares outstanding

(shares in

thousands)

Earnings per share

(in dollars)












For the three-month period ended June 30, 2018


~67~

(31) Business combinations

A. ECOVE Solvent Recycling Corporation

(a) On May 10, 2018, the Group acquired a 90% equity interest of ECOVE Solvent Recycling

Corporation in the amount of $49,590 in the form of cash, and had control over ECOVE

Solvent Recycling Corporation which is primarily engaged in operating basic chemical

industry and manufacture of other chemical products. As a result of the acquisition, the Group

is expected to increase its presence in these markets. It also expects to reduce costs through

economies of scale.

(b) The following table summarises the consideration paid for ECOVE Solvent Recycling

Corporation and the fair values of the assets acquired and liabilities assumed at the acquisition

date, as well as the non-controlling interest’s proportionate share of the recognized amounts

of acquiree’s identifiable net assets at the acquisition date:

Amount

after tax

Weighted-average

number of ordinary

shares outstanding

(shares in

thousands)

Earnings per share

(in dollars)













~68~

(c) The operating revenue included in the consolidated statement of comprehensive income since

May 10, 2018 contributed by ECOVE Solvent Recycling Corporation was $0. ECOVE

Solvent Recycling Corporation also contributed loss before income tax of ($7,014) over the

same period. Had ECOVE Solvent Recycling Corporation been consolidated from January 1,

2018, the consolidated statement of comprehensive income would increase operating revenue

by $1,485 and decrease profit before income tax by ($385).

B. ECOVE Solar Energy Corporation

(a) On September 20, 2018, the Group acquired a 50% equity interest of ECOVE Solar Energy

Corporation in the amount of $455,384 by cash, and have control over ECOVE Solar Energy

Corporation.

(b) The following table summarises the consideration paid for ECOVE Solar Energy Corporation

and the fair values of the assets acquired and liabilities assumed at the acquisition date, as

well as the non-controlling interest’s proportionate share of the recognized amounts of

acquiree’s identifiable net assets at the acquisition date:

May 10, 2018

Purchase consideration

Cash paid 49,590$

Non-controlling interest’s proportionate share of the recognised

amounts of acquiree’s identifiable net assets 4,126

53,716

Fair value of the identifiable assets acquired and liabilities assumed

Cash 150

Prepayments 291

Property, plant and equipment 68,492

Other non-current assets 588

Other payables 143)(

Other current liabilities 325)(

Long-term borrowings 27,800)(

Total identifiable net assets 41,253

Goodwill 12,463$

~69~

(c) The operating revenue included in the consolidated statement of comprehensive income since

September 20, 2018 contributed by ECOVE Solar Energy Corporation was $83,600, and the

contributed profit before income tax was $12,047 over the same period. Had ECOVE Solar

Energy Corporation been consolidated from January 1, 2018, the consolidated statement of

comprehensive income would increase operating revenue by $127,316 and profit before

income tax by $32,284.

(d) The fair value of the identifiable property, plant and equipment obtained is tentatively set at

$1,533,559 and the assets are subject to final valuation.

September 20, 2018

Purchase consideration

Cash paid 455,384$

Fair value of equity interest in ECOVE Solar Energy

Corporation held before the business combination 388,193

843,577

Fair value of the identifiable assets acquired and liabilities assumed

Cash 298,165

Accounts receivable 13,501

Other receivables 5,509

Prepayments 29,536

Property, plant and equipment 1,533,559

Deferred income tax assets 1,516

Other non-current assets 721,902

Short-term borrowings 143,000)(

Accounts payable 5,245)(

Current income tax liabilities 8,903)(

Other payables 33,310)(

Other current liabilities 138,880)(

Long-term borrowings 1,376,650)(

Deferred income tax liabilities 2,773)(

Other non-current liabilities 175,040)(

Total identifiable net assets 719,887

Goodwill 123,690$

~70~

(32) Operating leases

Prior to 2018

The Group’s future aggregate minimum lease payments under non-cancellable operating leases are

as follows:

(33) Supplemental cash flow information

A. Investing activities with partial cash payments

B. Financing activities with partial cash payments

(34) Changes in liabilities from financing activities

The Group’s liability from financing activities in 2019 and 2018 included short-term borrowings,

short-term notes and bills payable and long-term loan, the change is the cash flow of financing, etc.

The summary amount is as follows. For the rest of the information, please refer to the cash flow

statement.

December 31, 2018 June 30, 2018

Not later than one year 143,352$ 190,368$

Later than one year but not later than five years 254,239 239,666

Later than five years 370,879 14,195

768,470$ 444,229$

2019 2018

Purchase of property, plant and equipment 423,907$ 79,427$

Add: Opening balance of payable on equipment 1,785,960 -

Less: Ending balance of payable on equipment - -

Cash paid during the period 2,209,867$ 79,427$

2019 2018

Cash dividends 2,250,831$ 2,917,223$

Add: Opening balance of cash dividends payable - -

Less: Ending balance of cash dividends payable 2,113,814)( 2,844,131)(

Cash paid during the period 137,017$ 73,092$

2019

Liabilities from

financing activities-gross

At January 1 14,966,313$

Changes in cash flow from financing activities 699,821)(

At June 30 14,266,492$

~71~

7. RELATED PARTY TRANSACTIONS

(1) Names of related parties and relationship

2018

Liabilities from

financing activities-gross

At January 1 8,804,167$

Changes in cash flow from financing activities 1,336,058

Changes in acquisition of subsidiaries 27,800

At June 30 10,168,025$

Names of related parties Relationship with the Group

Pan Asia Corp. Associate

Boretech Resource Recovery Associate

MIE Industrial Sdn. Bhd. Associate

ZheJiang Boretech Environmental

Engineering Co., Ltd.Associate

Blue Whale Water Technology Corp. Associate

Powertech Energy Corp. Associate

EVER ECOVE CORP. Associate

HDEL-CTCI (Linhai) Associate

ECOVE Solar Energy Corporation The Group was a joint venture before

September 20, 2018, and became a subsidiary

starting from September 20, 2018.

Hsin Dar Environment Corp. Other related party

CTCI Foundation Other related party

CTCI Education Foundation Other related party

Gintech (Thailand) Limited Other related party

ECOVE Central Corporation Ltd. It was a related party before September 20,

2018, and became a subsidiary starting from

September 20, 2018.

ECOVE South Corporation Ltd. It was a related party before September 20,

2018, and became a subsidiary starting from

September 20, 2018.

~72~

(2) Significant transactions and balances with related parties

A. Sales of services

The price on the construction contracts entered into with related parties are set through negotiation

by both parties. The collection terms were approximately the same as those with third parties.

B. Purchases of services

The price on the construction subcontracts entered into with related parties are set through

negotiation by both parties.

C. Accounts receivable

2019 2018

Associates 1,035,293$ 258,862$

Joint ventures - 86,770

Other related parties 4,511 2,347

1,039,804$ 347,979$

2019 2018

Associates 1,538,696$ 475,549$

Joint ventures - 159,388


1,544,316$ 638,912$



2019 2018

Associates 197,059$ 340,996$


217,547$ 356,751$

2019 2018

Associates 568,843$ 1,327,783$


603,786$ 1,346,917$




Associates 496,773$ 942,076$ 30,087$

Other related parties - 1,995 1,926

496,773$ 944,071$ 32,013$

~73~

D. Accounts payable

E. Rental expense

F. Disposal of financial assets

G. Leasing arrangements - lessee

(a) The Group leases buildings from other related parties. Rental contracts are made for periods

from 2010 to 2029, and payments are made at the end of each year.

(b) Acquisition of right-of-use assets:

On January 1, 2019 (the date of initial application of IFRS 16), the Group increased right-of-

use assets by $88,886.


Associates 792,220$ 1,359,712$ 873,722$

Lessor Leased assets Rental amount 2019 2018

Other related parties Land / Buildings $698/month/

semiannual

payment-$ 2,093$

Lessor Leased assets Rental amount 2019 2018

Other related parties Land / Buildings $698/month/

semiannual

payment-$ 4,186$

For the three-month periods

ended June 30,

For the six-month periods

ended June 30,

Accounts No. of shares Objects Proceeds Gain/(loss)

Other related parties Financial assets

at fair value

through profit

or loss-non

current

17,556,000 Utech Solar Corp. 132,851$ 64,277$

For the six-month

period ended

June 30, 2018

2019 2018

Other related parties 88,886$ -$


~74~

(c) Lease liability

i. Outstanding balance:

ii. Interest expense

H. Provision for endorsements and guarantees

I. The Group donated $15,000 to the CTCI Education Foundation in March, 2018 for personnel

training and enterprise social responsibility.

(3) Key management compensation

June 30, 2019 June 30, 2018

Other related parties 84,988$ -$

2019 2018

Other related parties 288$ -$



Associates 3,307,300$ 1,984,300$ 769,300$

Joint ventures - - 719,622

3,307,300$ 1,984,300$ 1,488,922$

2019 2018

Salaries and other short-term employee

benefits

37,158$ 36,124$

Post-employment benefits 872 477

Other long-term benefits 619 205

Share-based payments 4,851 2,803

43,500$ 39,609$

2019 2018

Salaries and other short-term employee

benefits

131,420$ 125,303$

Post-employment benefits 1,131 2,111

Other long-term benefits 1,124 512

Share-based payments 7,576 4,932

141,251$ 132,858$



~75~

8. PLEDGED ASSETS

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNISED CONTRACT

COMMITMENTS

In addition to those items which have been disclosed in Note 6 (29), the significant contingent liabilities

and unrecognized contract commitments of the Group as of June 30, 2019 were as follows:

A. Guarantee

(a) The Group had outstanding notes payable for security deposits under various construction

projects amounting to $6,532,090.

(b) The Group had outstanding notes payable for bank financing amounting to $106,683,078.

B. The Group had unused and outstanding letters of credit of $793,730.

C. The Group had outstanding commitments for construction subcontracts and services contracts, less

accounts payable that were already paid and accrued in the future, of $40,526,673.

D. The Group had entered into contracts for acquisition of inventory amounting to $868,000.

Pledged assets June 30, 2019 December 31, 2018 June 30, 2018 Purpose

Other current assets

Guarantee for wages 5,873$ 5,816$ 5,978$ Guarantee for wages

Other non-current assets

Pledged time deposits 164,755 141,948 9,057 Guarantee for oil

expense, litigation

deposits,

construction

contracts and short-

term borrowing

Refundable deposits 138,729 130,167 133,135 Guarantee for oil

expense, rent, golf

certificates, tender

bonds, construction

contracts and

dormitory deposit

Long-term prepaid rent - 16,530 17,683 Guarantee for long-

term borrowings

Property, plant and

equipment

5,890,809 5,937,741 3,831,166 Guarantee for long-

term and short-term

borrowings

Investment property 805,976 808,129 810,390

Guarantee for long-

term and short-term

borrowings

7,006,142$ 7,040,331$ 4,807,409$

Book value

~76~

E. The Company had a joint procurement project with Mitsubishi Heavy Industries, Ltd. in 1996. The

construction was completed on February 19, 2000 and accepted by the Environmental Protection

Administration (the “EPA”) on May 16, 2000. According to the contract, the Company provided

warranty deposit amounting to $141,690 on the materials of the equipment. As the Kaohsiung County

government, the user of the incineration, had a dispute with the operating manufacturer, the EPB

rejected to repay the deposit.

The EPA availed of the warranty deposit on February 4, 2009. As a result, the Company had to remit

$73,253 to the procurement department of Bank of Taiwan Co., Ltd. Consequently, the Company

took action to cancel the deposit of $141,690 on February 6, 2009 and filed a lawsuit requiring EPA

to repay the $73,253. On April 16, 2009, the EPA indicated that it had repaid $9,299, which was the

warranty deposit of $73,253 less actual amounts used of $63,954, to the Company. Therefore, the

Company reduced the lawsuit claim to $63,954 plus interest of $117 and damage loss of $2,421. The

Company won the lawsuit apart from the loss compensation of 1,708. Nonetheless, the EPA appealed

the decision with the High Court, and the appeal was dismissed. The EPA then filed an appeal with

the Supreme Court, which reviewed and remanded the case to the High Court. After serval remands,

the High Court rendered a verdict in 105-Zhong-Shang-Geng-3-11 stating that the EPA should pay

$61,706, which bears an interest at 5% per annum starting from February 19, 2009 to the date of

repayment, to the Company, and denied the request of the Company for the compensation of $3,059.

Accordingly, the Company won the majority of the lawsuits. However, both parties filed appeals to

the third instance for the verdicts that were not in their favor and the case is still pending in the

Supreme Court.

According to the Company’s lawyer, the outcome of the case is still uncertain and the EPA received

an arbitration award as the defence. Thus, it is difficult to estimate any potential gain or loss on the

case.

F. The subsidiary, CTCI Smart Engineering Corp., has entered into an electrical and mechanical contract

with RPTI International Ltd. (RPTI) on behalf of the joint venture by RSEA Engineering Corporation

and CTCI Smart Engineering Corp. for partial permanent work of electrical and mechanical

engineering. However, as RPTI International Ltd. was behind the schedule, it agreed that CTCI

SMART ENGINEERING CORP. hire others to carry out the pending construction. In addition,

because RPTI was unable to perform the air conditioning construction as stated in the contract, CTCI

SMART ENGINEERING CORP. revoked the air conditioning construction, and re-contract out to

JEHNG LONG ENGINEERING CORP. The aforementioned construction expenses for hiring others

and for working on the terminated construction and losses were expected to be paid using RPTI’s

estimated assessment amount and retention payment. However, RPTI filed a lawsuit with the Taiwan

Taipei District Court, alleging improper deduction by CTCI SMART ENGINEERING CORP. and

requesting construction payment of $72,024 along with an interest at 5% per annum from November

28, 2007 until the date of repayment. The case was still in trial and CTCI SMART ENGINEERING

CORP. filed a counter-claim on August 8, 2008, alleging RPTI’s estimated assessment amount and

retention amount were insufficient to cover all payables, and requesting payment of $94,569. The

amount of $22,947 of the requested payment of $94,569 shall be paid along with an interest at 5%

per annum from July 16, 2008 until the date of repayment, while the remaining request amount shall

~77~

be paid along with an interest at 5% per annum from the date when RPTI receives the transcription

of counter-complaint until the date of repayment. RPTI expanded its claim to request a payment of

$111,079 along with an interest. On April 27, 2015, Taiwan Taipei District Court rendered a

judgement (Year 2008, Zian-Zi No. 21, Civil case) that CTCI SMART ENGINEERING CORP. needs

to pay RPTI an amount of $84,305 which comprises of $72,574 along with an interest at 5% per

annum from November 28, 2007 and of the remaining $11,731 along with an interest at 5% per

annum from December 15, 2010 until the date of repayment. RPTI’s remaining appeal and CTCI

SMART ENGINEERING CORP.’s counter-claim were refuted. CTCI SMART ENGINEERING

CORP. disagreed with the verdict and filed an appeal with the Taiwan High Court in the prescribed

time, asking for rejection to RPTI’s claim and judgment of the counter-claim. The counter-claim is

requesting RPTI to pay an amount of $75,166 which comprises of $22,947 along with an interest at

5% per annum from July 16, 2008 and of remaining $52,218 along with an interest at 5% per annum

from August 9, 2008 until the date of repayment. RPTI filed an incidental appeal requesting CTCI

SMART ENGINEERING CORP. to pay another amount of $7,092 along with an interest at 5% per

annum from November 28, 2007 until the date of repayment. Taiwan High Court rendered the

judgement on August 30, 2017. Refuted the verdict above and commanded that RPTI needs to pay

CTCI SMART ENGINEERING CORP. $57,899 along with an interest at 5% per annum from

August 9, 2008 until the date of repayment. RPTI appealed to the Supreme Court during the legal

period because they disagreed with the judgement. The Supreme Court rendered the judgement that

the verdict Taiwan High Court rendered was void and reverted the case back to the Taiwan High

Court for a retrial. During the retrial, the judge gave explicit instructions that CTCI SMART

ENGINEERING CORP. should obey the tenor sent by the Supreme Court and amend the statement

of payment request to the statement of creditor's rights confirmation request, the statement declares

that CTCI SMART ENGINEERING CORP. needs to pay RPTI an amount of $57,899 which

comprises of $22,947 along with an interest at 5% per annum from July 16, 2008 and of remaining

$34,952 along with an interest at 5% per annum from August 9, 2008 until the date of repayment and

they would be included in the Group’s claim in bankruptcy. According to the Company’s appointed

lawyers, the case is still pending in the Taiwan High Court, and the case number is Year 2018, Chong-

Shang-Gang-Yi-Zi No. 65.

G. The Company’s subsidiary, ECOVE Environment Services Corp., was ordered to pay $54,267 for air

pollution prevention fees by the Environmental Protection Department of the New Taipei City

Government on October 28, 2014, and the penalty was upheld after filing an administrative appeal.

On July 6, 2015, ECOVE Environment Services Corp. asked the Taipei High Administrative Court

to revoke both the original penalty and the subsequent decision on the administrative appeal, but the

request was denied. ECOVE Environment Services Corp. filed an appeal with the Supreme Court.

On January 31, 2018, the Supreme Court has rendered a judgement that the verdict rendered by the

Taiwan High Court was void and reverted the case back to the Taiwan High Court for a retrial. The

lawyer representing ECOVE Environment Services Corp. regards the original penalty to be illegal

and invalid, therefore no provisions for the lawsuit have been recognized in the financial statements.

~78~

10. SIGNIFICANT DISASTER LOSS

None.

11. SIGNIFICANT SUBSEQUENT EVENTS

None.

12. OTHERS

(1) Capital management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a

going concern in order to provide returns for shareholders and to maintain an optimal capital

structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group

may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new

shares or sell assets to reduce debt. The Group monitors capital on the basis of the gearing ratio.

This ratio is calculated as net debt divided by total capital. Total borrowings include ‘current and

non-current borrowings’ as shown in the consolidated balance sheet. Total capital is calculated as

‘equity’ as shown in the consolidated balance sheet.

The gearing ratios as of June 30, 2019, December 31, 2018 and June 30, 2018 were as follows:


Total borrowings 14,266,492$ 14,966,313$ 10,168,025$

Total equity 19,263,594$ 20,626,159$ 19,363,665$

Gearing ratio 74.06% 72.56% 52.51%

~79~

(2) Financial risk of financial instruments

A. Financial instruments by category


Financial assets

Financial assets at fair value through profit

or loss

Financial assets mandatorily measured at

fair value through profit or loss 382,122$ 554,638$ 420,043$

Financial assets at fair value through other

comprehensive income

Designation of equity instrument 1,270,468 1,262,160 1,196,144

Qualifying debit instrument 27,291 26,778 64,195

1,297,759$ 1,288,938$ 1,260,339$

Financial assets at amortised cost

Cash and cash equivalents 17,027,571$ 15,070,992$ 15,318,991$

Notes receivable 109,921 75,006 126,932

Accounts receivable 4,714,762 9,092,332 4,079,928

Accounts receivable due from related

parties 496,773 944,071 32,013

Other receivables 230,637 338,477 158,234

Refundable deposits 138,729 130,167 133,135

Long-term accounts receivable 2,319,445 2,392,339 2,353,698

Other financial assets 244,916 558,950 229,893

25,282,754$ 28,602,334$ 22,432,824$

Financial liabilities

Financial liabilities at fair value through

profit or loss

Financial liabilities mandatorily measured

at fair value through profit or loss 4,487$ 548$ -$

Financial liabilities at amortised cost

Short-term borrowings 10,396,242$ 13,414,459$ 8,047,275$

Short-term notes and bills payable 250,913 - -

Notes payable 22,229 18,788 5,224

Accounts payable 9,664,066 9,991,262 8,610,127

Accounts payable due to related parties 792,220 1,359,712 873,722

Other payables (including related parties) 4,088,570 4,692,516 4,658,235

Lease liability 378,647 - -

Long-term borrowings (including current

portion) 3,619,337 1,551,854 2,120,750

Guarantee deposits received 336,382 407,649 378,517

29,548,606$ 31,436,240$ 24,693,850$

~80~

B. Risk management policies

(a) The Group’s activities expose it to a variety of financial risks: market risk (including foreign

exchange risk, interest rate risk and price risk), credit risk and liquidity risk.

(b) Risk management is carried out by a central treasury department (Group treasury) under

policies approved by the Board of Directors. Group treasury identifies, evaluates and hedges

financial risks in close cooperation with the Group’s operating units. The Board provides

written principles for overall risk management, as well as written policies covering specific

areas and matters, such as foreign exchange risk, interest rate risk, credit risk, use of

derivative financial instruments and non-derivative financial instruments, and investment of

excess liquidity.

C. Significant financial risks and degrees of financial risks

(a) Market risk

Foreign exchange risk

i. The Group operates internationally and is exposed to exchange rate risk arising from the

transactions of the Company and its subsidiaries used in various functional currency,

primarily with respect to the USD and EUR. Exchange rate risk arises from future

commercial transactions and recognized assets and liabilities.

ii. Management has set up a policy to require group companies to manage their foreign

exchange risk against their functional currency. The companies are required to hedge their

entire foreign exchange risk exposure with the Group treasury.

~81~

iii. The Group’s businesses involve some non-functional currency operations (the

Company’s and certain subsidiaries’ functional currency: NTD; other certain subsidiaries’

functional currency: USD and RMB). The information on assets and liabilities

denominated in foreign currencies whose values would be materially affected by the

exchange rate fluctuations is as follows:

Foreign Currency

Amount

(In Thousands) Exchange Rate Book Value

(Foreign currency: functional

currency)

Financial assets

Monetary items

USD：NTD 148,687$ 31.0560 4,617,623$

EUR：NTD 21,862 35.3091 771,928

JPY：NTD 1,745,108 0.2885 503,464

MOP：NTD 57,345 3.8544 221,031

SGD：NTD 3,441 22.9458 78,956

USD：VND 1,861 23,305.0000 57,795

USD：MYR 1,255 4.1415 38,975

USD：THB 779 30.7851 24,193

RMB：NTD 5,228 4.5180 23,620

THB：NTD 9,042 1.0088 9,122

USD：EUR 92 0.8795 2,857

AUD：NTD 53 21.7625 1,153


Monetary items

USD：NTD 6,199 31.0560 192,516

USD：THB 2,270 30.7851 70,497

EUR：NTD 1,695 35.3091 59,849

USD：MYR 1,001 4.1415 31,087

SGD：NTD 948 22.9458 21,753

MOP：NTD 4,023 3.8544 15,506

RMB：NTD 1,351 4.5180 6,104

THB：NTD 1,589 1.0088 1,603

June 30, 2019

~82~

Foreign Currency

Amount


(Foreign currency: functional

currency)

Financial assets

Monetary items

USD : NTD 275,169$ 30.7400 8,458,695$

THB : NTD 817,495 0.9491 775,884

EUR : NTD 7,889 35.2327 277,951

USD : MYR 8,888 4.1575 273,217

MOP : NTD 53,270 3.8042 202,650

JPY : NTD 556,648 0.2779 154,692

RMB : NTD 23,979 4.4742 107,287

USD : THB 3,186 32.3886 97,938

SGD : NTD 4,271 22.4552 95,898

THB：USD 71,220 0.0309 67,595

RMB：USD 4,240 0.1455 18,971

USD：SAR 247 3.7523 7,593

SAR：NTD 555 8.1922 4,547

EUR：USD 80 1.1462 2,819


Monetary items

USD : SAR 32,700 3.7523 1,005,198

USD : NTD 10,733 30.7400 329,932

USD : MYR 4,298 4.1575 132,121

EUR : MYR 2,297 4.7651 80,930

EUR : NTD 1,316 35.2327 46,366

EUR：USD 1,198 1.1462 42,209

SGD : NTD 537 22.4552 12,064

MOP : NTD 2,723 3.8042 10,359

RMB：NTD 1,764 4.4742 7,892

SAR：NTD 406 8.1922 3,325

USD：SGD 95 1.3689 2,920

December 31, 2018

~83~

v. The unrealized exchange gain (loss) arising from significant foreign exchange variation

on the monetary items held by the Group for the three-month and six-month periods ended

June 30, 2019 and 2018 amounted to $129,705, $104,895, $134,193 and $59,275,

respectively.

Foreign Currency

Amount


(Foreign currency:

functional currency)

Financial assets

Monetary items

USD：NTD 128,615$ 30.5300 3,926,616$

EUR：NTD 622 35.5384 22,105

JPY：NTD 14,940 0.2758 4,120

THB：NTD 2,317 0.9208 2,133

AUD：NTD 814 22.5388 18,347

MOP：NTD 14,820 3.7716 55,895

SGD：NTD 684 22.3720 15,302

RMB：NTD 22,849 4.5982 105,064

SAR：NTD 726 8.1406 5,910

THB：USD 69,468 0.0302 63,966

RMB：USD 15,868 0.1506 72,964

USD：THB 4,379 33.1560 33,691

USD：SAR 188 3.7503 5,870

USD：MYR 9,570 4.0385 272,360

EUR：USD 193 1.1640 6,859


Monetary items

USD：NTD 5,460 30.5300 166,694

EUR：NTD 9,384 35.5384 333,492

JPY：NTD 590,551 0.2758 162,874

SGD：NTD 1,730 22.3720 38,704

THB：NTD 2,061 0.9208 1,898

SEK：NTD 1,320 3.4021 4,491

MOP：NTD 11,937 3.7716 45,022

RMB：NTD 24,575 4.5982 113,001

USD：SAR 42,700 3.7503 1,303,631

JPY：USD 27,000 0.0090 7,447

HKD：USD 46 7.8475 11,021

June 30, 2018

~84~

vi. Analysis of foreign currency market risk arising from significant foreign exchange

variation:

Degree of Effect on Profit

Effect on Other

Comprehensive

Variation or Loss Income

( Foreign currency:


Financial assets

Monetary items

USD：NTD 1% 46,176$ -$

EUR：NTD 1% 7,719 -

JPY：NTD 1% 5,035 -

MOP：NTD 1% 2,210 -

SGD：NTD 1% 790 -

USD：VND 1% 578 -

USD：MYR 1% 390 -

USD：THB 1% 242 -

RMB：NTD 1% 236 -

THB：NTD 1% 91 -

USD：EUR 1% 29 -

AUD：NTD 1% 12 -


Monetary items

USD：NTD 1% 1,925 -

USD：THB 1% 705 -

EUR：NTD 1% 598 -

USD：MYR 1% 311 -

SGD：NTD 1% 218 -

MOP：NTD 1% 155 -

RMB：NTD 1% 61 -

THB：NTD 1% 16 -

June 30, 2019

Sensitivity Analysis

~85~


Effect on Other

Comprehensive


( Foreign currency:


Financial assets

Monetary items

USD : NTD 1% $ 84,587 -$

THB : NTD 1% 7,759 -

EUR : NTD 1% 2,780 -

USD : MYR 1% 2,732 -

MOP : NTD 1% 2,027 -

JPY : NTD 1% 1,547 -

RMB : NTD 1% 1,073 -

USD : THB 1% 979 -

SGD : NTD 1% 959 -

THB：USD 1% 676 -

RMB：USD 1% 190 -

USD：SAR 1% 76 -

SAR：NTD 1% 45 -

EUR：USD 1% 28 -


Monetary items

USD : SAR 1% 10,052 -

USD : NTD 1% 3,299 -

USD : MYR 1% 1,321 -

EUR : MYR 1% 809 -

EUR : NTD 1% 464 -

EUR：USD 1% 422 -

SGD : NTD 1% 121 -

MOP : NTD 1% 104 -

RMB：NTD 1% 79 -

SAR：NTD 1% 33 -

USD：SGD 1% 29 -


December 31, 2018

~86~


Effect on Other

Comprehensive


( Foreign currency:


Financial assets

Monetary items

USD：NTD 1% $ 39,266 -$

EUR：NTD 1% 221 -

JPY：NTD 1% 41 -

THB：NTD 1% 21 -

AUD：NTD 1% 183 -

MOP：NTD 1% 559 -

SGD：NTD 1% 153 -

RMB：NTD 1% 1,051 -

SAR：NTD 1% 59 -

THB：USD 1% 640 -

RMB：USD 1% 730 -

USD：THB 1% 337 -

USD：SAR 1% 59 -

USD：MYR 1% 2,724 -

EUR：USD 1% 69 -


Monetary items

USD：NTD 1% 1,667 -

EUR：NTD 1% 3,335 -

JPY：NTD 1% 1,629 -

SGD：NTD 1% 387 -

THB：NTD 1% 19 -

SEK：NTD 1% 45 -

MOP：NTD 1% 450 -

RMB：NTD 1% 1,130 -

USD：SAR 1% 13,036 -

JPY：USD 1% 74 -

HKD：USD 1% 110 -

June 30, 2018


~87~

Price risk

The Group’s equity securities, which are exposed to price risk, are the held financial assets at

fair value through other comprehensive income, financial assets at fair value through profit or

loss and available-for-sale financial assets. To manage its price risk arising from investments

in equity securities, the Group diversifies its portfolio. Diversification of the portfolio is done

in accordance with the limits set by the Group.

Cash flow and fair value interest rate risk

The Group’s interest rate risk arises from borrowings. Borrowings issued at variable rates

expose the Group to cash flow interest rate risk which is partially offset by cash and cash

equivalents held at variable rates. During the six-month periods ended June 30, 2019 and 2018,

the Group’s borrowings at variable rate were denominated in NTD and USD.

(b) Credit risk

i. Credit risk refers to the risk of financial loss to the Group arising from default by the

clients or counterparties of financial instruments on the contract obligations. According to

the Group’s credit policy, each local entity in the Group is responsible for managing and

analyzing the credit risk for each of their new clients before standard payment and delivery

terms and conditions are offered.

ii. Individual risk limited is controlled by internal risk that assesses the credit quality of the

customers, taking into account their financial position, past experience and other factors.

iii. The Group adopts the assumption under IFRS 9, that is, if the contract payments were past

due over 30 days based on the terms, there has been a significant increase in credit risk on

that instrument since initial recognition.

iv. The Group adopts the assumption under IFRS 9, that is, the default occurs when the

customers’ contract payments are past due over 90 days.

v. The Group classifies customers’ accounts receivable and contract assets in accordance

with customer types. The Group applies the simplified approach using provision matrix

and loss rate methodology to estimate expected credit loss under the provision matrix basis.

vi. The Group used the forecastability of Taiwan Institute of Economic Research boom

observation report to adjust historical and timely information to assess the default

possibility of accounts receivable. On June 30, 2019, December 31, 2018 and June 30,

2018, the provision matrix is as follows:

~88~

Note 1: Government institutions, state-owned enterprises and listed companies

Note 2: Companies that are not included in Note 1.

Movements in relation to the Group applying the simplified approach to provide loss

allowance for accounts receivable, contract assets and lease payments receivable are as

follows:

Excellent

customers

(Note 1)

General

customers

(Note 2)

Individual

assessment

customers Total

June 30, 2019

Expected loss rate 0.03%~0.4% 0.03%~100% 50%~100%

Total book value 2,183,957$ 2,665,486$ 1,090$ 4,850,533$

Loss allowance 2,230)( 22,530)( 1,090)( 25,850)(

December 31, 2018


Total book value 4,488,537$ 4,699,248$ 5,148$ 9,192,933$

Loss allowance 2,749)( 19,019)( 3,827)( 25,595)(

June 30, 2018


Total book value 2,487,128$ 1,706,435$ 86,958$ 4,280,521$

Loss allowance 4,039)( 12,677)( 56,945)( 73,661)(

2019

Accounts receivable

At January 1 25,595$

Provision for impairment 255

Reversal of impairment -

At June 30 25,850$

2018

Accounts receivable

At January 1_IAS 39 84,920$

Adjustments under new standards -

Provision for impairment 18,289

Reversal of impairment 128)(

Write-offs 29,420)(

At June 30 73,661$

~89~

(c) Liquidity risk

i. Cash flow forecasting is performed in the operating entities of the Group and aggregated

by Group treasury. Group treasury monitors rolling forecasts of the Group’s liquidity

requirements to ensure it has sufficient cash to meet operational needs so that the Group

does not breach borrowing limits or covenants on any of its borrowing facilities. Such

forecasting takes into consideration the Group’s debt financing plans, covenant

compliance, compliance with internal balance sheet ratio targets.

ii. The table below analyses the Group’s non-derivative financial liabilities and net-settled

derivative financial liabilities into relevant maturity groupings based on the remaining

period at the balance sheet date to the contractual maturity date for non-derivative

financial liabilities and to the expected maturity date for derivative financial liabilities.

The amounts disclosed in the table are the contractual undiscounted cash flows.

Non-derivative financial liabilities

June 30, 2019 Less than 1 year More than 1 year

Short-term borrowings 10,443,579$ -$

Short-term notes and bills payable 251,076 -

Notes payable 22,229 -

Accounts payable (including related parties) 10,456,286 -

Other payables (including related parties) 4,088,570 -

Lease liabilities 126,174 252,473


portion)225,590 4,406,373


December 31, 2018 Less than 1 year More than 1 year






portion)131,788 1,670,586


June 30, 2018 Less than 1 year More than 1 year






portion)

324,487 2,118,863

~90~

(d) Cash flow risk from variations of rates

There is no significant cash flow risk from variations of rates since accounts payable are due

less than one year.

(3) Fair value information

A. The different levels that the inputs to valuation techniques are used to measure fair value of

financial and non-financial instruments have been defined as follows:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the

entity can access at the measurement date. A market is regarded as active if it meets

all the following conditions: the items traded in the market are homogeneous; willing

buyers and sellers can normally be found at any time; and prices are available to the

public. The fair value of the Group’s investment in listed stocks, beneficiary

certificates with quoted market prices is included in Level 1.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the

asset or liability, either directly or indirectly. The fair value of the Group’s investment

in most derivative instruments is included in Level 2.

Level 3: Inputs for the asset or liability that are not based on observable market data.

Derivative financial liabilities

Between 3 months

June 30, 2019 Less than 3 months and 1 year

Exchange rate swaps (net-settled) $ 4,162 $ -

Merchandise exchange contracts 19 -

Forward exchange contracts - 306

Derivative financial liabilities

Between 3 months

December 31, 2018 Less than 3 months and 1 year

Merchandise exchange contracts $ 548 $ -

~91~

B. The related information of financial and non-financial instruments measured at fair value by level

on the basis of the nature, characteristics and risks of the assets and liabilities are as follows:

(a) The related information of the nature of the assets and liabilities is as follows:

June 30, 2019 Level 1 Level 2 Level 3 Total

Financial assets:

Financial assets at fair value

through profit or loss

　Beneficiary certificates 369,341$ -$ -$ 369,341$

　Derivative instruments - 12,781 - 12,781



income

　Equity securities-current 502,059 - - 502,059

　Equity securities

-non-current - - 768,409 768,409

　Debt securities - 27,291 - 27,291

Total 871,400$ 40,072$ 768,409$ 1,679,881$

Financial liabilities:

Financial liabilities at fair value


　Derivative instruments -$ 4,487$ -$ 4,487$

December 31, 2018 Level 1 Level 2 Level 3 Total

Financial assets:







income



-non-current - - 788,611 788,611


Total 977,872$ 77,093$ 788,611$ 1,843,576$

Financial liabilities:

Financial liabilities at fair value


　Derivative instruments -$ 548$ -$ 548$

~92~

(b) The methods and assumptions the Group used to measure fair value are as follows:

i. The instruments the Group used market quoted prices as their fair values (that is, Level 1)

are listed below by characteristics:

ii. Except for financial instruments with active markets, the fair value of other financial

instruments is measured by using valuation techniques or by reference to counterparty

quotes.

C. There was no transfer between Level 1 and Level 2 for the six-month periods ended June 30,

2019 and 2018.

D. Movements on Level 3 for the six-month periods ended June 30, 2019 and 2018 are as follows:

E. For the six-month period ended June 30, 2018, there was no transfer into or out from Level 3.

June 30, 2018 Level 1 Level 2 Level 3 Total

Financial assets:







income



-non-current - - 644,062 644,062


Total 930,397$ 105,923$ 644,062$ 1,680,382$

Listed shares Open-end fund

Market quoted price Closing price Net asset value

2019 2018

Equity securities Equity securities

At January 1 788,611$ 739,940$

Gains and losses recognised in profit or loss

Recorded as non-operating income and expenses - 49,159

Recorded as unrealised gains (losses) on

valuation of investments in equity

instruments measured at fair value

through other comprehensive income 20,223)( 12,186)(

Sold in the period - 132,851)(

Effects of changes in foreign exchange rates 21 -

At June 30 768,409$ 644,062$

~93~

F. Group finance segment is in charge of valuation procedures for fair value measurements being

categorised within Level 3, which is to verify independent fair value of financial instruments.

Such assessment is to ensure the valuation results are reasonable by applying independent

information to make results close to current market conditions, confirming the resource of

information is independent, reliable and in line with other resources and represented as the

exercisable price, and frequently calibrating valuation model, performing back-testing, updating

inputs used to the valuation model and making any other necessary adjustments to the fair value.

Investment property is valuated regularly by the Group’s Finance segment based on the valuation

methods and assumptions announced by the Financial Supervisory Commission, Securities and

Futures Bureau or through outsourced appraisal performed by the external valuer.

G. The following is the qualitative information of significant unobservable inputs and sensitivity

analysis of changes in significant unobservable inputs to valuation model used in Level 3 fair

value measurement:

Fair value at

June 30,

2019

Valuation

technique

Significant

unobservable

input

Range (weighted

average)

Relationship of

inputs to fair

value

Non-derivative

equity

instrument:

Unlisted shares 219,392$ Market

comparable

companies

Price to book

ratio multiple,

discount for

lack of

marketability

Median:1.83

Average:1.83

Liquidity discount:

17.5%

The higher the

multiple and

control

premium, the

higher the fair

value

Fair value at

December 31,

2018

Valuation

technique

Significant

unobservable

input

Range (weighted

average)

Relationship of

inputs to fair

value

Non-derivative

equity

instrument:


comparable

companies

Price to book

ratio multiple,

discount for

lack of

marketability

Median:1.86

Average:1.79

Liquidity discount:

17.5%

The higher the

multiple and

control

premium, the

higher the fair

value

~94~

H. The Group has carefully assessed the valuation models and assumptions used to measure fair

value. However, use of different valuation models or assumptions may result in different

measurement. The following is the effect of profit or loss or of other comprehensive income from

financial assets and liabilities categorised within Level 3 if the inputs used to valuation models

have changed:

Fair value at

June 30,

2018

Valuation

technique

Significant

unobservable

input

Range (weighted

average)

Relationship of

inputs to fair

value

Non-derivative

equity

instrument:


comparable

companies

Price to book

ratio multiple,

discount for

lack of

marketability

Median:1.87

Average:1.67

Liquidity discount:

23%~45%

The higher the

multiple and

control

premium, the

higher the fair

value

Unlisted shares 389,533 Net assets Not applicable - Not applicable

Input Change

Favourable

change

Unfavourable

change

Favourable

change

Unfavourable

change

Financial assets

Equity

instrument

Price to book

ratio multiple,

discount for

lack of

marketability

± 1% -$ -$ 1,716$ 1,741)($

Input Change

Favourable

change

Unfavourable

change

Favourable

change

Unfavourable

change

Financial assets

Equity

instrument

Price to book

ratio multiple,

discount for

lack of

marketability

± 1% -$ -$ $ 24,521 ($ 24,521)

June 30, 2019

Recognised in

profit or loss

Recognised in other


December 31, 2018

Recognised in

profit or loss

Recognised in other


~95~

13. SUPPLEMENTARY DISCLOSURES

(1) Significant transactions information

A. Loans to others: Please refer to table 1.

B. Provision of endorsements and guarantees to others: Please refer to table 2.

C. Holding of marketable securities at the end of the period (not including subsidiaries, associates

and joint ventures): Please refer to table 3.

D. Acquisition or sale of the same security with the accumulated cost exceeding NT$300 million

or 20% of the Company’s paid-in capital: None.

E. Acquisition of real estate reaching NT$300 million or 20% of paid-in capital or more: None.

F. Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more: None.

G. Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paid-

in capital or more: Please refer to table 4.

H. Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more:

Please refer to table 5.

I. Derivative financial instruments undertaken during the reporting periods: Please refer to Notes

6(2) and 12(2).

J. Significant inter-company transactions during the reporting periods: Please refer to table 6.

(2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland

China)：Please refer to table 7.

Input Change

Favourable

change

Unfavourable

change

Favourable

change

Unfavourable

change

Financial assets

Equity

instrument

Price to book

ratio multiple,

discount for

lack of

marketability

± 1% -$ -$ $ 2,545 ($ 2,545)

Equity

instrument

Not applicable± 1% $ - $ - $ 3,895 ($ 3,895)

June 30, 2018

Recognised in

profit or loss

Recognised in other


~96~

(3) Information on investments in Mainland China

A. Basic information: Please refer to table 8.

B. Significant transactions, either directly or indirectly through a third area, with investee

companies in the Mainland Area: None.

14. SEGMENTAL FINANCIAL INFORMATION

(1) General information

A. The Group has identified which segments should be reported based on the information used by

the Board of Directors to make decisions.

B. The Board of Directors classify reportable segments as construction engineering department,

environmental resource department, sales department and other operating departments.

(2) Measurement of segmental financial information

The Board of Directors evaluates the performance of segments based on segmental income. Interest

income and expenses cannot be attributed to any segment because such activity is handled by the

Company’s financial department.

(3) Segmental income, assets and liabilities of segments

The segmental financial information provided to the Board of Directors is as follows:

Construction

Engineering

Environmental

Resource Sales

Other

Operating

Department Department Department Departments Total

External revenues 23,747,085$ 2,533,349$ 67,249$ 746,240$ 27,093,923$

Internal revenues 1,320,050 8,178 - 237,896 1,566,124

Segmental revenues 25,067,135$ 2,541,527$ 67,249$ 984,136$ 28,660,047$

Segmental income 238,830$ 592,591$ 44,279$ 90,337$ 966,037$

Depreciation and

amortization 208,702$ 102,591$ 5,704$ 40,522$ 357,519$


Construction

Engineering

Environmental

Resource Sales Other Operating

Department Department Department Departments Total

External revenues 25,204,991$ 2,374,288$ 68,759$ 248,709$ 27,896,747$

Internal revenues 1,204,317 20,566 - 244,444 1,469,327

Segmental revenues 26,409,308$ 2,394,854$ 68,759$ 493,153$ 29,366,074$

Segmental income 366,814$ 582,006$ 14,469$ 124,686$ 1,087,975$

Depreciation and

amortization 188,373$ 18,129$ 8,639$ 42,402$ 257,543$


~97~

(4) Reconciliation information of segmental income

Intra-segment sales are of arm’s length transactions. The measurement of external revenues reported

to the Board of Directors is consistent with revenues in the statement of comprehensive income. The

reconciliation information of income from continuing operations before income tax and segmental

income is as follows:

2019 2018

Segmental income 966,037$ 1,087,975$

Adjustment and elimination 6,076 12,238

Share of loss of associates and

joint ventures accounted for using equity

method 208,525)( 17,997)(

Interest income 131,825 107,931

Foreign exchange gain 116,729 35,208

Finance costs 124,575)( 79,181)(

Others 95,924 148,002

Income from continuing operations before

income tax 983,491$ 1,294,176$


Item Value

0 CTCI Corp. CTCI

Engineering &

Construction

Sdn. Bhd.

Other

receivables

Yes 1,105,930$ 1,086,960$ -$ - 2 - For

operational

need

-$ - -$ 3,271,505$ 6,543,011$ -

0 CTCI Corp. CTCI

Machinery

Corp.

Other

receivables

Yes 650,000 650,000 632,000 1.01% 2 - For

operational

need

- - - 3,271,505 6,543,011 -

0 CTCI Corp. CTCI Arabia

Ltd.

Other

receivables

Yes 1,485,106 1,459,632 1,372,986 2.311%

~2.799%

2 - For

operational

need

- - - 3,271,505 6,543,011 -

0 CTCI Corp. CTCI

Singapore

Pte. Ltd.

Other

receivables

Yes 1,421,910 1,397,520 1,384,527 2.684%

~2.799%

2 - For

operational

need

- - - 3,271,505 6,543,011 -

0 CTCI Corp. CTCI Smart

Engineering

Corp.

Other

receivables

Yes 500,000 500,000 363,000 1.01% 2 - For

operational

need

- - - 3,271,505 6,543,011 -

0 CTCI Corp. CTCI

(Thailand)

Co., Ltd.

Other

receivables

Yes 800,000 800,000 716,248 1.01% 2 - For

operational

need

- - - 3,271,505 6,543,011 -

0 CTCI Corp. CIPEC

Construction

Inc.

Other

receivables

Yes 631,960 621,120 - - 2 - For

operational

need

- - - 3,271,505 6,543,011 -

1 CTCI

Advanced

System Inc.

CTCI Corp. Other

receivables

Yes 45,000 45,000 - - 2 - For

operational

need

- - - 53,442 213,769 -

2 CTCI

Overseas

Co., Ltd.

Superiority

(Thailand)

Co., Ltd.

Other

receivables

Yes 71,803 71,803 71,803 2.520% 2 - For

operational

need

- - - 695,882 695,882 -

Allowance

for

doubtful

accounts

Collateral

Limit on loans

granted to

a single party

（Note 7）

Ceiling on

total loans

granted

（Note 7） Footnote

Reason

for short-term

financing

（Note 6）

No.

（Note 1） Creditor Borrower

General

ledger

account

（Note 2）

Is a

related

party

Maximum

outstanding

balance during

six-month

period ended

June 30, 2019

(Note 3)

Balance at

June 30, 2019

（Note 8）

Actual amount

drawn down

Interest

rate

Nature of

loan

（Note 4）

Amount of

transactions

with the

borrower

（Note 5）

CTCI Corporation and its subsidiaries

Loans to others


Table 1 Expressed in thousands of NTD

(Except as otherwise indicated)

Table 1 Page 1

Item Value

Allowance

for

doubtful

accounts

Collateral

Limit on loans

granted to

a single party

（Note 7）

Ceiling on

total loans

granted


Reason

for short-term

financing

（Note 6）

No.


General

ledger

account

（Note 2）

Is a

related

party

Maximum

outstanding

balance during

six-month

period ended

June 30, 2019

(Note 3)

Balance at

June 30, 2019

（Note 8）

Actual amount

drawn down

Interest

rate

Nature of

loan

（Note 4）

Amount of

transactions

with the

borrower

（Note 5）

2 CTCI

Overseas

Co., Ltd.

CIPEC

Construction

Inc.

Other

receivables

Yes 312,472$ 21,491$ 21,480$ 2.625% 2 - For

operational

need

-$ - -$ 695,882$ 695,882$ -

2 CTCI

Overseas

Co., Ltd.

CTCI CMCE

JV SDN.

BHD.

Other

receivables

Yes 37,704 21,739 9,006 3.751% 2 - For

operational

need

- - - 695,882 695,882 -

2 CTCI

Overseas

Co., Ltd.

CTCI

Americas

Inc.

Other

receivables

Yes 129,552 127,330 127,330 2.333%

~2.604%

2 - For

operational

need

- - - 695,882 695,882 -

2 CTCI

Overseas

Co., Ltd.

CCJV P1

Engineering

& Construction

Sdn. Bhd.

Other

receivables

Yes 432,558 357,144 357,144 2.581%

~2.644%

2 - For

operational

need

- - - 695,882 695,882 -

3 CTCI

Overseas

(BVI) Corp.

CIPEC

Construction

Inc.

Other

receivables

Yes 20,811 - - - 2 - For

operational

need

- - - 698,646 698,646 -

4 ECOVE

Environment

Corp.

CTCI Solar

Energy

Corporation

Other

receivables

Yes 200,000 200,000 200,000 1.01% 2 - For

operational

need

- - - 457,868 1,831,470 -

5 ECOVE

Environment

Services

Corp.

ECOVE Solvent

Recycling

Corporation

Other

receivables

Yes 70,000 70,000 55,000 1.01% 2 - For

operational

need

- - - 63,659 254,637 -

5 ECOVE

Environment

Services

Corp.

ECOVE Miaoli

Energy Corp.

Other

receivables

Yes 70,000 70,000 - - 2 - For

operational

need

- - - 63,659 254,637 -

5 ECOVE

Environment

Services

Corp.

CTCI

Machinery

Corp.

Other

receivables

Yes 35,000 30,000 - - 2 - For

operational

need

- - - 63,659 254,637 -

5 ECOVE

Environment

Services

Corp.

CTCI Resources

Engineering

Inc.

Other

receivables

Yes 35,000 - - - 2 - For

operational

need

- - - 63,659 254,637 -

Table 1 Page 2

Item Value

Allowance

for

doubtful

accounts

Collateral

Limit on loans

granted to

a single party

（Note 7）

Ceiling on

total loans

granted


Reason

for short-term

financing

（Note 6）

No.


General

ledger

account

（Note 2）

Is a

related

party

Maximum

outstanding

balance during

six-month

period ended

June 30, 2019

(Note 3)

Balance at

June 30, 2019

（Note 8）

Actual amount

drawn down

Interest

rate

Nature of

loan

（Note 4）

Amount of

transactions

with the

borrower

（Note 5）

5 ECOVE

Environment

Services

Corp.

CTCI Corp. Other

receivables

Yes 70,000$ 30,000$ -$ - 2 - For

operational

need

-$ - -$ 63,659$ 254,637$ -

5 ECOVE

Environment

Services

Corp.

CTCI Smart

Engineering

Corp.

Other

receivables

Yes 70,000 30,000 - - 2 - For

operational

need

- - - 63,659 254,637 -

6 CTCI Solar

Energy

Corporation

ECOVE

Central

Corporation

Ltd.

Other

receivables

Yes 17,000 17,000 - - 2 - For

operational

need

- - - 287,539 287,539 -

6 CTCI Solar

Energy

Corporation

ECOVE South

Corporation

Ltd.

Other

receivables

Yes 14,000 14,000 14,000 1.71% 2 - For

operational

need

- - - 287,539 287,539 -

6 CTCI Solar

Energy

Corporation

ECOVE Solar

Power

Corporation

Other

receivables

Yes 200,000 156,000 28,000 1.71% 2 - For

operational

need

- - - 287,539 287,539 -

7 ECOVE

Waste

Management

Corp.

CTCI

Machinery

Corp.

Other

receivables

Yes 7,000 7,000 - - 2 - For

operational

need

- - - 6,786 27,144 -

7 ECOVE

Waste

Management

Corp.

CTCI Smart

Engineering

Corp.

Other

receivables

Yes 7,000 7,000 - - 2 - For

operational

need

- - - 6,786 27,144 -

8 CTCI Beijing

Co., Ltd.

CTCI Shanghai

Co., Ltd.

Other

receivables

Yes 275,922 271,080 - - 2 - For

operational

need

- - - 707,341 707,341 -

Table 1 Page 3

Note 1: The numbers filled in for the loans provided by the Company or subsidiaries are as follows:

(1)The Company is ‘0’.

(2)The subsidiaries are numbered in order starting from ‘1’.

Note 2: Fill in the name of account in which the loans are recognised, such as receivables-related parties, current account with stockholders, prepayments, temporary payments, etc.

Note 3: Fill in the maximum outstanding balance of loans to others during the six-month period ended June 30, 2018

Note 4:.The numbers filled in for the nature of loans are as follows:

　　　(1) Business association is labeled as “1”

　　　(2) Short-term financing is labeled as “2”.

Note 5: Fill in the amount of business transactions when nature of the loan is related to business transactions, which is the amount of business transactions occurred between the creditor and borrower in the current year.

Note 6: Fill in purpose of loan when nature of loan belongs to short-term financing, for example, repayment of loan, acquisition of equipment, working capital, etc.

Note 7: The calculation and amount on ceiling of loans are as follows:

　　　[The company]

　　　(1) The limit on loans granted to a single party shall not exceed 20% of the Company's net assets value.

　　　(2) The ceiling on total loans shall not exceed 40% of the Company's net assets value.

　　　[Domestic subsidiaries and overseas subsidiaries]

　　　(1) The limit on loans granted to a single party by domestic subsidiaries and overseas subsidiaries shall not exceed 10% and 40% of the Company's net value, respectively.

　　　(2) The ceiling on total loans shall not exceed 40% of the Company's net assets value.

Note 8: The amounts of funds to be loaned to others which have been approved by the board of directors of a public company in accordance with Article 14, Item 1 of the “Regulations Govering Loaning of Funds and Making

of Endorsements/Guarantees by public Companies” should be included in its published balance of loans to others at the end of the reporting period to reveal the risk of loaning the public company bears , even though they

have not yet been appropriated. However, this balance should excluded the loans repaid when repayments are done subsequently to reflect the risk adjustment. In addition, if the board of directors of a public company has

authorised the chairman to loan funds in instalments or in revolving within certain lines and within one year in accordance with Article 14, Item 2,of the “Regulations Governing Loaning of Funds and Making of Endorsements/

Guarantees by Public Companies”, the published balance of loans to others at the end of the reporting period should also include these lines of loaning approved by the board of directors , and these lines of loaning should not be

excluded from this balance even though the loans are repaid subsequently, for taking into consideration they could be loaned again thereafter.

Table 1 Page 4

Company name

Relationship

with the

endorser/

guarantor

（Note 2）

0 CTCI Corp. Universal Engineering

(BVI) Corporation

2 49,072,581$ 31,598$ 31,056$ -$ -$ 0.19% 98,145,162$ Y N N -

0 CTCI Corp. CTCI Machinery Corp. 2 49,072,581 4,836,207 4,835,482 4,486,444 - 29.56% 98,145,162 Y N N -

0 CTCI Corp. CTCI Development Corp. 2 49,072,581 500,000 500,000 - - 3.06% 98,145,162 Y N N -

0 CTCI Corp. CTCI Americas, Inc. 2 49,072,581 1,441,912 1,417,179 120,625 - 8.66% 98,145,162 Y N N -

0 CTCI Corp. CTCI Engineering &

Construction Sdn. Bhd.

2 49,072,581 1,857,034 1,844,146 1,409,362 - 11.27% 98,145,162 Y N N -

0 CTCI Corp. CTCI Singapore Pte. Ltd. 2 49,072,581 2,518,062 2,481,908 164,559 - 15.17% 98,145,162 Y N N -

0 CTCI Corp. CINDA Engineering &

Construction Pvt. Ltd.

2 49,072,581 3,095,856 3,072,010 1,472,556 - 18.78% 98,145,162 Y N N -

0 CTCI Corp. CTCI Arabia Ltd. 2 49,072,581 3,797,435 3,640,956 2,004,783 - 22.26% 98,145,162 Y N N -

0 CTCI Corp. CTCI Overseas Co., Ltd. 2 49,072,581 4,956,543 4,872,910 1,414,508 - 29.79% 98,145,162 Y N N -

0 CTCI Corp. CTCI Trading

Shanghai Co., Ltd.

2 49,072,581 161,239 86,957 - - 0.53% 98,145,162 Y N Y -

0 CTCI Corp. CTCI Shanghai Co., Ltd. 2 49,072,581 1,035,737 1,035,737 233,943 - 6.33% 98,145,162 Y N Y -

0 CTCI Corp. CTCI Beijing Co., Ltd. 2 49,072,581 1,096,232 1,078,662 567,542 - 6.59% 98,145,162 Y N Y -

0 CTCI Corp. CCJV P1 E&C Sdn. Bhd. 2 49,072,581 1,248,121 1,226,712 280,975 - 7.50% 98,145,162 Y N N -

0 CTCI Corp. CTCI Smart Engineering

Corp.

2 49,072,581 29,623 29,115 - - 0.18% 98,145,162 Y N N -

Amount of

endorsements/

guarantees

secured with

collateral

Ratio of

accumulated

endorsement/

guarantee amount

to net asset value

of the endorser/

guarantor

company

Ceiling on

total amount of

endorsements/

guarantees provided

（Note 3）

Provision of

endorsements/

guarantees by

parent

company to

subsidiary

（Note 7）

Provision of

endorsements/

guarantees by

subsidiary to

parent

company

（Note 7）

Outstanding

endorsement/

guarantees

amount at

June 30, 2019

（Note 5）


Provision of endorsements and guarantees to others




Number

（Note 1）

Endorser/

guarantor

Party being

endorsed/guaranteedLimit on

endorsements/

guarantees

provided for

a single party

（Note 3）

Maximum

outstanding

endorsement/

guarantee

amount as of

June 30, 2019

（Note 4）

Provision of

endorsement

s/guarantees

to the party

in Mainland

China


Actual amount

drawn down

（Note 6）

Table 2 Page 1

Company name

Relationship

with the

endorser/

guarantor

（Note 2）

Amount of

endorsements/

guarantees

secured with

collateral

Ratio of

accumulated

endorsement/

guarantee amount

to net asset value

of the endorser/

guarantor

company

Ceiling on

total amount of

endorsements/

guarantees provided

（Note 3）

Provision of

endorsements/

guarantees by

parent

company to

subsidiary

（Note 7）

Provision of

endorsements/

guarantees by

subsidiary to

parent

company

（Note 7）

Outstanding

endorsement/

guarantees

amount at

June 30, 2019

（Note 5）

Number

（Note 1）

Endorser/

guarantor

Party being


endorsements/

guarantees

provided for

a single party

（Note 3）

Maximum

outstanding

endorsement/

guarantee

amount as of

June 30, 2019

（Note 4）

Provision of

endorsement

s/guarantees

to the party

in Mainland

China


Actual amount

drawn down

（Note 6）

0 CTCI Corp. CTCI (Thailand) Co.,

Ltd.

2 49,072,581$ 1,980,826$ 1,980,826$ 445,602$ -$ 12.11% 98,145,162$ Y N N -

0 CTCI Corp. CTCI Chemical Corp. 2 49,072,581 20,144 19,798 12,096 - 0.12% 98,145,162 Y N N -

0 CTCI Corp. CTCI-HDEC (Chungli)

Corporation

6 49,072,581 102,000 102,000 102,000 - 0.62% 98,145,162 Y N N -

0 CTCI Corp. CB&I-CTCI B.V. 6 49,072,581 6,695,578 6,580,729 6,580,729 - 40.23% 98,145,162 N N N -

0 CTCI Corp. Blue Whale Water

Technology Co., Ltd.

6 49,072,581 769,300 769,300 673,260 - 4.70% 98,145,162 N N N -

0 CTCI Corp. HDEC-CTCI (Linhai)

Corporation

6 49,072,581 1,215,000 1,215,000 180,000 - 7.43% 98,145,162 N N N -

0 CTCI Corp. CIPEC Construction Inc. 2 49,072,581 527,099 525,520 318,982 - 3.21% 98,145,162 Y N N -

0 CTCI Corp. EVER ECOVE Corp. 6 49,072,581 1,102,500 1,102,500 87,500 - 6.74% 98,145,162 N N N -

0 CTCI Corp. CTCI Malaysia Sdn. Bhd. 2 49,072,581 853,146 838,512 15,747 - 5.13% 98,145,162 Y N N -

0 CTCI Corp. CTCI CMCE JV

SDN. BHD.

6 49,072,581 470,254 - - - - 98,145,162 N N N -

1 CTCI

Advanced

System Inc.

Century Ahead Ltd. 2 534,423 18,959 18,634 - - 3.49% 1,068,846 N N N -

2 CTCI

Machinery

Corp.

CTCI Smart Engineering

Corp.

5 1,441,303 560,000 560,000 560,000 - 116.56% 2,882,607 N N N -

3 CTCI

Chemical

Corp.

CTCI Machinery Corp. 5 716,009 532,830 532,830 532,830 - 223.25% 1,432,019 N N N -

3 CTCI

Chemical

Corp.

CTCI Corp. 3 716,009 18,817 18,817 18,817 - 7.88% 1,432,019 N Y N -

Table 2 Page 2

Company name

Relationship

with the

endorser/

guarantor

（Note 2）

Amount of

endorsements/

guarantees

secured with

collateral

Ratio of

accumulated

endorsement/

guarantee amount

to net asset value

of the endorser/

guarantor

company

Ceiling on

total amount of

endorsements/

guarantees provided

（Note 3）

Provision of

endorsements/

guarantees by

parent

company to

subsidiary

（Note 7）

Provision of

endorsements/

guarantees by

subsidiary to

parent

company

（Note 7）

Outstanding

endorsement/

guarantees

amount at

June 30, 2019

（Note 5）

Number

（Note 1）

Endorser/

guarantor

Party being


endorsements/

guarantees

provided for

a single party

（Note 3）

Maximum

outstanding

endorsement/

guarantee

amount as of

June 30, 2019

（Note 4）

Provision of

endorsement

s/guarantees

to the party

in Mainland

China


Actual amount

drawn down

（Note 6）

4 CTCI

Shanghai

Co., Ltd.

CTCI Trading Shanghai

Co., Ltd.

2 1,510,571$ 68,981$ 67,770$ 67,770$ -$ 13.46% 3,021,141$ N N Y -

5 CTCI

Resources

Engineering

Inc.


Corp.

5 867,506 267,102 267,102 267,102 - 92.37% 1,735,011 N N N -

6 ECOVE

Environment

Corp.

ECOVE Solar Power

Corporation

2 9,157,352 317,000 317,000 200,099 - 6.92% 13,736,028 N N N -

6 ECOVE

Environment

Corp.

ECOVE South

Corporation Ltd.

2 9,157,352 150,000 150,000 - - 3.28% 13,736,028 N N N -

6 ECOVE

Environment

Corp.

ECOVE Solar

Energy Corporation

2 9,157,352 1,927,353 1,927,353 1,335,643 - 42.09% 13,736,028 N N N -

6 ECOVE

Environment

Corp.

ECOVE Solvent

Recycling Corporation

2 9,157,352 155,800 155,800 42,000 - 3.40% 13,736,028 N N N -

6 ECOVE

Environment

Corp.

EVER ECOVE Corp. 6 9,157,352 220,500 220,500 17,500 - 4.82% 13,736,028 N N N -

7 ECOVE Solar

Energy

Corporation

ECOVE South

Corporation Ltd.

2 2,875,392 14,000 14,000 13,300 - 1.95% 4,313,088 N N N -

7 ECOVE Solar

Energy

Corporation

ECOVE Central

Corporation Ltd.

2 2,875,392 16,790 16,790 15,990 - 2.34% 4,313,088 N N N -

7 ECOVE Solar

Energy

Corporation

ECOVE Solar Power

Corporation

2 2,875,392 784,076 784,076 528,822 - 109.07% 4,313,088 N N N -

8 ECOVE Solar

Power

Corporation

ECOVE Solar Energy

Corporation

3 816,246 12,420 12,420 12,420 - 6.09% 1,224,369 N N N -

Table 2 Page 3

Note 1: The numbers filled in for the endorsements/guarantees provided by the Company or subsidiaries are as follows:

(1)The Company is ‘0’.


Note 2: Relationship between the endorser/guarantor and the party being endorsed/guaranteed is classified into the following six categories; fill in the number of category each case belongs to:

(1)Having business relationship.

(2)The endorser/guarantor parent company owns directly more than 50% voting shares of the endorsed/guaranteed subsidiary.

(3)The endorser/guarantor parent company and its subsidiaries jointly own more than 50% voting shares of the endorsed/guaranteed company.

(4)The endorsed/guaranteed parent company directly or indirectly owns more than 90% voting shares of the endorser/guarantor subsidiary.

(5)Mutual guarantee of the trade as required by the construction contract.

(6)Due to joint venture, each shareholder provides endorsements/guarantees to the endorsed/guaranteed company in proportion to its ownership.

(7)The performance guarantees for the sale of pre-sales contracts under the Consumer Protection Law are jointly guaranteed.

Note 3: Fill in limit on endorsements/guarantees provided for a single party and ceiling on total amount of endorsements/guarantees provided as prescribed in the endorser/guarantor company’s

“Procedures for Provision of Endorsements and Guarantees”, and state each individual party to which the endorsements/guarantees have been provided and the calculation for ceiling on total amount

of endorsements/guarantees provided in the footnote.

　　[The company]

　　　(1)The limit on endorsements and guarantees granted to a single party shall not exceed 300% of the Company’s net assets value in last financial statements which was audited by accountant.

　　　(2)The ceiling on total endorsements and guarantees shall not exceed 600% of the Company’s net assets value in last financial statements which was audited by accountant.

　　[Domestic subsidiaries and overseas subsidiaries]

　　　(1)The limit on endorsements and guarantees granted to a single party shall not exceed 100% to 400% of the Company's net assets value in last financial statements which was audited by accountant.

　　　(2)The ceiling on total endorsements and guarantees shall not exceed 200% to 600% of the Company's net assets value in last financial statements which was audited by accountant.

Note 4: Fill in the year-to-date maximum outstanding balance of endorsements/guarantees provided as of the reporting period.

Note 5: Once endorsement/guarantee contracts or promissory notes are signed/issued by the endorser/guarantor company to the banks, the endorser/guarantor company bears endorsement/guarantee liabilities. And all other

events involve endorsements and guarantees should be included in the balance of outstanding endorsements and guarantees.

Note 6: Fill in the actual amount of endorsements/guarantees used by the endorsed/guaranteed company.

Note 7: Fill in ‘Y’ for those cases of provision of endorsements/guarantees by listed parent company to subsidiary and provision by subsidiary to listed parent company, and provision to the party in Mainland China.

Table 2 Page 4

Type of

marketable

securities Name of Investee company

Number of shares/

denominations

Book value

(Note 3)

Ownership

(%) Market value

CTCI Corp. Fund BlackRock Global Fund - European

Value Fund A2 USD Hedged

N/A Financial assets at fair value

through profit or loss-current

12,438 4,602$ - 4,442$ -

CTCI Corp. Fund Fubon US Preferred Stock ETF N/A Financial assets at fair value


500,000 10,000 - 9,975 -

14,602 14,417$

Adjustment 185)(

14,417$

CTCI Corp. Common Stock China Steel Chemical Corp. The Company is the

supervisor

Financial asset at fair value


income-current

1,726,916 96,713$ - 233,134$ -

CTCI Corp. Common Stock United Renewable Energy Co., Ltd. N/A Financial asset at fair value


income-current

644,015 6,505 - 6,247 -

CTCI Corp. Common Stock Taiwan Cement Corp. N/A Financial asset at fair value


income-current

1,980,000 68,448 - 90,189 -

171,666 329,570$

Adjustment 157,904

329,570$



Securities held by

(Note 1)

Relationship with the

securities issuer

(Note 2)

General

ledger account

As of June 30, 2019

Footnote

（Note 4）


Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures)


Table 3 Page 1

Type of

marketable


Number of shares/

denominations

Book value

(Note 3)

Ownership

(%) Market valueSecurities held by


securities issuer

(Note 2)

General

ledger account

Footnote

（Note 4）

CTCI Corp. Common Stock Core Pacific City Co., Ltd. N/A Financial assets at fair value


income-non-current

22,428,000 360,000$ 2.26 219,392$ -

CTCI Corp. Common Stock CDIB & Partners Investment

Holding Corp.

The Company is the

supervisor



income-non-current

27,000,000 250,000 2.48 250,000 -

CTCI Corp. Common Stock Metro-consultant Co., Ltd. The Company is the

Board of director



income-non-current

300,000 3,000 6.00 3,000 -

CTCI Corp. Common Stock Ever Victory Global Limited. N/A Financial assets at fair value


income-non-current

9,440,000 292,225 2.62 292,225 -

CTCI Corp. Common Stock Heng Keng Corp. N/A Financial assets at fair value


income-non-current

20,000 3,000 5.12 - -

908,225 764,617$

Less: Accumulated impairment 143,608)(

764,617$

CTCI Investment

Corporation

Fund Franklin Templeton Sinoam Money

Market Fund



671,211 6,946$ - 6,946$ -

CTCI Investment

Corporation

Common Stock United Renewable Energy Co., Ltd. N/A Financial asset at fair value


income-current

69,030 670 - 670 -

CTCI Investment

Corporation

Common Stock CTCI Corp. The Company Financial assets at fair value


income-non-current

344,436 16,051 0.05 16,051 -

CTCI Investment

Corporation

Common Stock Global Strategic Investment Inc. N/A Financial assets at fair value


income-non-current

283,500 962 0.65 962 -

Table 3 Page 2

Type of

marketable


Number of shares/

denominations

Book value

(Note 3)

Ownership



securities issuer

(Note 2)

General

ledger account

Footnote

（Note 4）

CTCI Development

Corp.



income-non-current

912,170 42,507$ 0.12 42,507$ -

CTCI Development

Corp.

Common Stock CTCI Advanced System Inc. Subsidiary Financial assets at fair value


income-non-current

324,417 14,096 1.38 14,096 -

CTCI Development

Corp.



income-current

173,010 1,678 - 1,678 -

CTCI Development

Corp.

Fund FSITC Money Market N/A Financial assets at fair value


135,024 24,118 - 24,118 -

CTCI Resources

Engineering Inc.



income-current

291,080 2,823 - 2,823 -

CTCI Resources

Engineering Inc.

Common Stock Global Strategic Investment Inc. N/A Financial assets at fair value


income-non-current

567,000 1,924 1.29 1,924 -

CTCI Resources

Engineering Inc.

Fund Yuanta De-Li Money Market Fund N/A Financial assets at fair value


3,371,941 55,045 - 55,045 -

CTCI Resources

Engineering Inc.

Fund Taishin 1699 Money Market Fund N/A Financial assets at fair value


3,328,669 45,085 - 45,085 -

ECOVE Waste

Management

Corporation



3,234,775 43,815 - 43,815 -

ECOVE Waste

Management

Corporation

Fund Franklin Templeton Sinoam Money

Market Fund



630,309 6,523 - 6,523 -

ECOVE Waste

Management

Corporation

Common Stock Taiwan Cement Corp. N/A Financial asset at fair value


income-current

478,841 21,811 - 21,811 -

Table 3 Page 3

Type of

marketable


Number of shares/

denominations

Book value

(Note 3)

Ownership



securities issuer

(Note 2)

General

ledger account

Footnote

（Note 4）

ECOVE Wujih

Energy

Corporation



37,981 6,784$ - 6,784$ -

ECOVE Wujih

Energy

Corporation



income-current

475,508 21,659 - 21,659 -

ECOVE

Environment

Corp.



income-current

472,758 21,534 - 21,534 -

ECOVE

Environment

Corp.



56,070 10,015 - 10,015 -

ECOVE

Environment

Corp.



income-current

116,157 1,127 - 1,127 -

ECOVE

Environment

Corp.

Common Stock TeamWIN Opto-Electronics

Co., Ltd.



income-non-current

150,000 475 2.46 475 -

ECOVE

Environment

Corp.

Common Stock Eastern Pacific Energy Sdn. Bhd. ECOVE Environment

Corp.'s President is the

director



income-non-current

10,000 68 10.00 68 -

ECOVE

Environmental

Services

Corporation

Common Stock CTCI Corp. The Company Financial asset at fair value


income-current

1,028 48 - 48 -

ECOVE

Environmental

Services

Corporation



income-current

1,251,971 57,027 - 57,027 -

ECOVE

Environmental

Services

Corporation



income-current

145,567 1,412 - 1,412 -

Table 3 Page 4

Type of

marketable


Number of shares/

denominations

Book value

(Note 3)

Ownership



securities issuer

(Note 2)

General

ledger account

Footnote

（Note 4）

ECOVE

Environmental

Services

Corporation

Fund Schroder 2022 Maturity Emerging Market

Quality Sovereign Bond Fund



35,000 11,350$ - 11,350$ -

ECOVE

Environmental

Services

Corporation



4,441,844 60,164 - 60,164 -

ECOVE

Environmental

Services

Corporation

Fund Yuanta De-Li Money Market Fund N/A Financial assets at fair value


1,227,267 20,034 - 20,034 -

ECOVE Mioali

Energy

Corporation

Fund FSITC Taiwan Money Market N/A Financial assets at fair value


130,559 2,000 - 2,000 -

ECOVE Mioali

Energy

Corporation



39,259 7,012 - 7,012 -

CTCI (Thailand)

Co., Ltd.

Common Stock CHIYODA(Thailand) Co. Ltd. N/A Financial assets at fair value


income-non-current

3,600 363 9.00 363 -

Crown Asia-2

Investment Limited



income-non-current

500 23 - 23 -

CTCI Advanced

System Inc.

Fund FSITC Taiwan Money Market N/A Financial assets at fair value


718,669 11,010 - 11,010 -

CTCI Advanced

System Inc.



252,060 45,023 - 45,023 -

Table 3 Page 5

Type of

marketable


Number of shares/

denominations

Book value

(Note 3)

Ownership



securities issuer

(Note 2)

General

ledger account

Footnote

（Note 4）

CTCI Advanced

System Inc.



income-current

908,578 41,386$ - 41,386$ -

CTCI Advanced

System Inc.



income-current

140,430 1,362 - 1,362 -

CTCI Advanced

System Inc.

Bonds BANK OF CHINA LTD PARIS N/A Financial asset at fair value


income-current

6,000,000 27,291 - 27,291 Note 5

Note 1: Marketable securities in the table refer to stocks, bonds, beneficiary certificates and other related derivative securities in accordance with IAS 39, ‘Financial instruments: recognition and measurement’.

Note 2: Leave the column blank if the issuer of marketable securities is non-related party.

Note 3: Fill in the book value without deduction of allowance for valuation loss of the marketable securities.

Note 4: The number of shares of securities and their amounts pledged as security or pledged for loans and their restrictions on use under some agreements should be stated in the footnote if the securities presented herein have such conditions.

Note 5: The book value of bonds denominated in CNY.

Table 3 Page 6

Purchases (sales) Amount

Percentage of

total purchases

(sales) Credit term Unit price Credit term Balance

Percentage of

total notes/accounts

receivable (payable)

ECOVE Environmental

Services Corporation

ECOVE Waste

Management

Corporation

Second-tier subsidiary (Sales) 319,846)($ 1.18% )(

30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

108,889$ 2.09% -

ECOVE Environmental


ECOVE Wujih Energy

Corporation

Second-tier subsidiary (Sales) 121,275)( 0.45% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

83,370 1.60% -

ECOVE Wujih Energy

Corporation

ECOVE Waste

Management

Corporation

Second-tier subsidiary (Sales) 215,885)( 0.80% )(

30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

85,235 1.64% -

CTCI Corp. CTCI Overseas Co., Ltd. Subsidiary (Sales) 453,324)( 1.67% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

87,050 1.67% -

CTCI Corp. EVER ECOVE Corp. Associate (Sales) 447,659)( 1.65% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

826 0.02% -

CTCI Corp. Blue Whale Water


Associate (Sales) 108,744)( 0.40% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

1,047 0.02% -

CTCI Advanced System

Inc.

CTCI Corp. The Company (Sales) 116,498)( 0.43% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

41,581 0.80% -

CTCI Development Corp. CTCI Corp. The Company (Sales) 154,318)( 0.57% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

- - -

CTCI Engineering &


MIE INDUSTRIAL

SDN. BHD.

Associate (Sales) 880,854)( 3.25% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

494,212 9.48% -

CTCI Engineering &


CCJV P1 Engineering

& Construction Sdn.

Bhd.

Subsidiary (Sales) 212,802)( 0.79% )(

30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

189,974 3.65% -

ECOVE Wujih Energy

Corporation

ECOVE Environmental


Second-tier subsidiary Purchases 121,275 0.48% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

83,370)( 0.85% )( -

ECOVE Waste Management

Corporation

ECOVE Environmental



seasonal billings

Negotiated by both

parties

No significant

difference

108,889)( 1.12% )( -


Corporation

ECOVE Wujih Energy

Corporation


seasonal billings

Negotiated by both

parties

No significant

difference

85,235)( 0.87% )( -


Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paid-in capital or more




Notes/accounts receivable (payable)

FootnotePurchaser/seller Counterparty


counterparty

Transaction

Differences in transaction terms

compared to third party

transaction

Table 4 Page 1

Purchases (sales) Amount

Percentage of

total purchases

(sales) Credit term Unit price Credit term Balance

Percentage of

total notes/accounts

receivable (payable)

Notes/accounts receivable (payable)

FootnotePurchaser/seller Counterparty


counterparty

Transaction

Differences in transaction terms

compared to third party

transaction


System Inc.

Subsidiary Purchases 116,498$ 0.46% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

41,581)($ 0.43% )( -

CTCI Corp. CTCI Development Corp. Subsidiary Purchases 154,318 0.61% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

- - -

CTCI Overseas Co., Ltd. CTCI Corp. The Company Purchases 453,324 1.79% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

87,050)( 0.89% )( -

CTCI Engineering

& Construction Sdn. Bhd.

MIE INDUSTRIAL

SDN. BHD.

Associate Purchases 411,310 1.63% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

333,789)( 3.42% )( -

CCJV P1 E&C SDN. BHD. MIE INDUSTRIAL

SDN. BHD.

Associate Purchases 157,504 0.62% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

368,866)( 3.78% )( -

CCJV P1 Engineering &


CTCI Engineering &


Subsidiary Purchases 212,802 0.84% )( 30 days after

seasonal billings

Negotiated by both

parties

No significant

difference

189,974)( 1.95% )( -

Table 4 Page 2

Table 5

Amount Action taken

CTCI Corp. CTCI Machinery Corp. Subsidiary 632,000$ Note -$ - -$ -

CTCI Corp. CTCI Arabia Ltd. Subsidiary 1,372,986 Note - - - -

CTCI Corp. CTCI Singapore Pte. Ltd. Subsidiary 1,384,527 Note - - - -

CTCI Corp. CTCI Smart Engineering

Corp. Subsidiary363,000

Note- - - -

CTCI Corp. CTCI (Thailand ) Co., Ltd. Subsidiary 716,248 Note - - - -

CTCI Corp. CTCI CMCE JV SDN. BHD. Subsidiary 121,826 0.06 - Active collection - -

ECOVE Environment Corp. ECOVE Solar Energy Corporation Second-tier subsidiary 200,000 Note - - - -

CTCI Overseas Co., Ltd. CCJV P1 Engineering &

Construction Sdn. Bhd. Subsidiary357,144

Note- - - -

CTCI Overseas Co., Ltd. CTCI Americas Inc.Subsidiary

127,330 Note

- - - -

CTCI Engineering & Construction

Sdn. Bhd.

MIE INDUSTRIAL SDN. BHD.Associate

494,212 3.33 - - - -

ECOVE Environmental



Corporation Second-tier subsidiary108,889 3.06 - Active collection - -

CTCI Engineering & Construction

Sdn. Bhd.

CCJV P1 Engineering &

Construction Sdn. Bhd. Subsidiary189,974 3.30 - - - -

Note：Other accounts receivable arise from lending capital.


Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more


Expressed in thousands of NTD


Amount collected

subsequent to the

balance sheet date

Allowance for

doubtful accounts Creditor Counterparty

Relationship

with the counterparty

Balance as at

June 30, 2019 Turnover rate

Overdue receivables

Table 5 Page 1

General ledger

account Amount Transaction terms

Percentage of consolidated total

operating revenues or total assets

(Note 3)

0 CTCI Corp. CTCI Overseas Co., Ltd. 1 Sales revenue 453,324$ Negotiated by both

parties

1.67%

1 ECOVE Environmental Services

Corporation

ECOVE Waste Management Corporation 3 Sales revenue 319,846 Negotiated by both

parties

1.18%


Corporation

ECOVE Wujih Energy Corporation 3 Sales revenue 121,275 Negotiated by both

parties

0.45%

2 ECOVE Wujih Energy Corporation ECOVE Waste Management Corporation 3 Sales revenue 215,885 Negotiated by both

parties

0.80%

3 CTCI Advanced System

Inc.

CTCI Corp. 2 Sales revenue 116,498 Negotiated by both

parties

0.43%

4 CTCI Development Corp. CTCI Corp. 2 Sales revenue 154,318 Negotiated by both

parties

0.57%

12 CTCI Engineering & Construction

Sdn. Bhd.

CCJV P1 Engineering & Construction Sdn. Bhd. 3 Sales revenue 212,802 Negotiated by both

parties

0.79%


Corporation

ECOVE Waste Management Corporation 3 Accounts

receivable

108,889 Negotiated by both

parties

0.16%

12 CTCI Engineering & Construction

Sdn. Bhd.

CCJV P1 Engineering & Construction Sdn. Bhd. 3 Accounts

receivable


parties

0.28%

0 CTCI Corp. CTCI CMCE JV SDN. BHD. 3 Accounts

receivable


parties

0.18%

0 CTCI Corp. CTCI Machinery Corp. 1 Other receivables 632,000 Negotiated by both

parties

0.92%

0 CTCI Corp. CTCI (Thailand ) Co., Ltd. 1 Other receivables 716,248 Negotiated by both

parties

1.05%


Significant inter-company transactions during the reporting period




Number

(Note 1) Company name Counterparty

Relationship

(Note 2)

Transaction

Table 6 Page 1

General ledger




(Note 3)

Number


Relationship

(Note 2)

Transaction

0 CTCI Corp. CTCI Arabia Ltd. 1 Other receivables 1,372,986$ Negotiated by both

parties

2.00%

0 CTCI Corp. CTCI Singapore Pte. Ltd. 1 Other receivables 1,384,527 Negotiated by both

parties

2.02%

0 CTCI Corp. CTCI Smart Engineering Corp. 1 Other receivables 363,000 Negotiated by both

parties

0.53%

5 ECOVE Environment Corp. ECOVE Solar Energy Corporation 3 Other receivables 200,000 Negotiated by both

parties

0.29%

6 CTCI Overseas Co., Ltd. CCJV P1 Engineering & Construction Sdn. Bhd. 3 Other receivables 357,144 Negotiated by both

parties

0.52%

6 CTCI Overseas Co., Ltd. CTCI Americas Inc. 3 Other receivables 127,330 Negotiated by both

parties

0.19%

0 CTCI Corp. CTCI Overseas (BVI) Co. and its subsidiaries. 1 Advance

construction

receipt

5,795,050 Negotiated by both

parties

8.46%

7 CTCI Machinery Corp. CTCI Corp. 2 Advance

construction

receipt

3,335,759 Negotiated by both

parties

4.87%

8 CTCI Resources Engineering Inc. CTCI Corp. 2 Advance

construction

receipt


parties

0.37%

9 CTCI (Thailand ) Co., Ltd. CTCI Corp. 2 Advance

construction

receipt


parties

1.05%

0 CTCI Corp. CTCI Development Corp. 1 Refundable

deposits


parties

0.19%

0 CTCI Corp. CTCI Machinery Corp. 1 Guarantee 4,835,482 Not applicable Not applicable

0 CTCI Corp. CTCI Development Corp. 1 Guarantee 500,000 Not applicable Not applicable

0 CTCI Corp. CTCI Americas, Inc. 1 Guarantee 1,417,179 Not applicable Not applicable

0 CTCI Corp. CTCI Engineering & Construction Sdn. Bhd. 1 Guarantee 1,844,146 Not applicable Not applicable

Table 6 Page 2

General ledger




(Note 3)

Number


Relationship

(Note 2)

Transaction

0 CTCI Corp. CTCI Singapore Pte. Ltd. 1 Guarantee 2,481,908$ Not applicable Not applicable

0 CTCI Corp. CINDA Engineering & Construction Pvt. Ltd. 1 Guarantee 3,072,010 Not applicable Not applicable

0 CTCI Corp. CTCI Arabia Ltd. 1 Guarantee 3,640,956 Not applicable Not applicable

0 CTCI Corp. CTCI Overseas Co., Ltd. 1 Guarantee 4,872,910 Not applicable Not applicable

0 CTCI Corp. CTCI Shanghai Co., Ltd. 1 Guarantee 1,035,737 Not applicable Not applicable

0 CTCI Corp. CTCI Beijing Co., Ltd. 1 Guarantee 1,078,662 Not applicable Not applicable

0 CTCI Corp. CCJV P1 E&C Sdn. Bhd. 1 Guarantee 1,226,712 Not applicable Not applicable

0 CTCI Corp. CTCI (Thailand) Co., Ltd. 1 Guarantee 1,980,826 Not applicable Not applicable

0 CTCI Corp. CTCI-HDEC (Chungli) Corporation 1 Guarantee 102,000 Not applicable Not applicable

0 CTCI Corp. CIPEC Construction Inc. 1 Guarantee 525,520 Not applicable Not applicable

0 CTCI Corp. CTCI Malaysia Sdn. Bhd. 1 Guarantee 838,512 Not applicable Not applicable

7 CTCI Machinery Corp. CTCI Smart Engineering Corp. 3 Guarantee 560,000 Not applicable Not applicable

10 CTCI Chemical Corp. CTCI Machinery Corp. 3 Guarantee 532,830 Not applicable Not applicable

8 CTCI Resources Engineering Inc. CTCI Smart Engineering Corp. 3 Guarantee 267,102 Not applicable Not applicable

5 ECOVE Environment Corp. ECOVE Solar Power Corporation 3 Guarantee 317,000 Not applicable Not applicable

5 ECOVE Environment Corp. ECOVE South Corporation Ltd. 3 Guarantee 150,000 Not applicable Not applicable

5 ECOVE Environment Corp. ECOVE Solar Energy Corporation 3 Guarantee 1,927,353 Not applicable Not applicable

5 ECOVE Environment Corp. ECOVE Solvent Recycling Corporation 3 Guarantee 155,800 Not applicable Not applicable

11 ECOVE Solar Energy Corporation ECOVE Solar Power Corporation 3 Guarantee 784,076 Not applicable Not applicable

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

(1)Parent company is ‘0’.


Note 2: Relationship between transaction company and counterparty is classified into the following three categories; fill in the number of category each case belongs to (If transactions between parent company and subsidiaries or between

subsidiaries refer to the same transaction, it is not required to disclose twice. For example, if the parent company has already disclosed its transaction with a subsidiary, then the subsidiary is not required to disclose the transaction;

for transactions between two subsidiaries, if one of the subsidiaries has disclosed the transaction, then the other is not required to disclose the transaction.):

(1)Parent company to subsidiary.

(2)Subsidiary to parent company.

(3)Subsidiary to subsidiary.

Note 3: Regarding percentage of transaction amount to consolidated total operating revenues or total assets, it is computed based on period-end balance of transaction to consolidated total assets for balance sheet accounts and based on

accumulated transaction amount for the period to consolidated total operating revenues for income statement accounts.

Note 4: The Company may decide to disclose or not to disclose transaction details in this table based on the Materiality Principle.

Table 6 Page 3

Balance as at

June 30, 2019

Balance as at

December 31, 2018 Number of shares Ownership (%) Book value

CTCI Corp. CTCI Smart Engineering

Corp.

Taiwan Design, management,

and building of nuclear

power, thermal power,

fire pumped storage

power generation and

others related to

engineering.

$ 456,251 $ 456,251 59,098,624 97.09 $ 14,245 ($ 148,303) ($ 143,987) A subsidiary

CTCI Corp. CTCI Resources

Engineering Inc.

Taiwan Mining of geology, sea oil

and gas, marbal and

rare；planning, design,

monitor of civil, traffic

environment and various

mechanical and

electrical equipment.

262,649 262,649 24,762,252 99.05 327,985 48,751 44,861 A subsidiary


Systems Inc.

Taiwan Systems planning, design,

integration, and

engineering for various

IT systems, etc.

44,409 44,409 11,444,842 48.72 260,371 42,663 20,786 A subsidiary

CTCI Corp. CTCI Development

Corp.

Taiwan Real estate and leasing

business.

1,870,000 1,690,000 187,000,000 100.00 2,772,722 60,613 60,613 A subsidiary

CTCI Corp. CTCI Investment

Corporation

Taiwan General investment. 2,072,000 2,072,000 207,200,000 100.00 1,559,342 ( 170,969) ( 170,969) A subsidiary

CTCI Corp. ECOVE Environment

Corp.

Taiwan General investment. 938,889 938,889 38,457,105 57.31 2,624,039 402,616 230,730 A subsidiary

CTCI Corp. CTCI (Thailand)

Co., Ltd.

Thailand Design and building of

petrochemical plant.

116,894 116,894 1,249,500 49.00 ( 186,373) ( 493,367) ( 241,750) A subsidiary


Information on investees (not including investees in Mainland China)




Net profit (loss)

of the investee for the

six-month period

ended June 30, 2019

(Note 2(2))

Investment income(loss)

recognised by the

Company for the six-

month period ended June

30, 2019（Note 2(3)） Footnote Investor

Investee

(Notes 1 and 2) Location Main business activities

Initial investment amount Shares held as at June 30, 2019

Table 7 Page 1

Balance as at

June 30, 2019

Balance as at


Net profit (loss)


six-month period

ended June 30, 2019

(Note 2(2))


recognised by the




Investee



CTCI Corp. CTCI Machinery

Corp.

Taiwan Secondary processing

of steel, piping, heat

treatment, manufacture

of pollution control

equipment and non-

destructive testing, etc.

$ 293,800 $ 293,800 20,000,000 100.00 $ 469,805 $ 37,234 $ 37,234 A subsidiary

CTCI Corp. CTCI Arabia Ltd. Arabia Construction and

maintenance of refinery,

storage tanks and

chemical plant.

23,312 23,312 500 50.00 ( 568,335) 1,190 595 A subsidiary

CTCI Corp. Sinogal-Waste

Services Corp.

Macao Management of waste

recycling

site and maintenance of

related

mechanical and equipment,

etc.

4,958 4,958 - 30.00 37,158 100,094 30,028 A subsidiary

CTCI Corp. CTCI Singapore Pte.

Ltd.

Singapore Investment and planning

of related engineering.

152,254 152,254 5,100,000 100.00 ( 652,822) 13,874 13,874 A subsidiary

CTCI Corp. CTCI Overseas

(BVI) Corp.

BVI Investment and planning


308,554 308,554 6,740,000 100.00 2,235,923 383,327 383,327 A subsidiary

CTCI Corp. CTCI Engineering &


Malaysia Investment and planning


4,118 4,118 450,000 60.00 ( 27,193) ( 40,242) ( 24,145) A subsidiary

CTCI Corp. CTCI CMCE JV

SDN. BHD.

Malaysia Construction planning. 2,759 2,759 382,500 51.00 8,056 ( 1,115) ( 1,115) A subsidiary

CTCI Corp. CTCI Americas, Inc. USA To extend foreign business,

the Group strengthen the

collaborative relationship with

local business owner and

supplier, developing adequate

potential supplier, and help

them to operate projects,

purchase and other related

businesses.

3,217 3,217 100,000 100.00 ( 34,558) ( 38,464) ( 38,464) A subsidiary

CTCI Corp. CCJV P1

Engineering &

Construction Sdn.

Bhd.

Malaysia Construction planning. 2,259 2,259 247,500 99.00 ( 923,173) ( 853,248) ( 844,715) A subsidiary

Table 7 Page 2

Balance as at

June 30, 2019

Balance as at


Net profit (loss)


six-month period

ended June 30, 2019

(Note 2(2))


recognised by the




Investee



CTCI Corp. CTCI-HDEC (Chungli)

Corporation

Taiwan Sewerage System BOT

Project.

$ 255,000 $ 255,000 25,500,000 51.00 $ 243,386 ($ 2,217) ($ 1,130) A subsidiary

CTCI Corp. Blue Whale Water


Taiwan Wastewater Reclamation Unit

BTO Project.

347,900 347,900 36,260,000 49.00 399,109 56,382 27,627 An investee

under

equity

method

CTCI Corp. Pan Asia Corp. Taiwan Input of foreign labor

and technologies,

technical cooperation

with foreign construction

business, and construction of

engineering construction, etc.

35,826 71,543 19,639,509 17.16 220,865 16,201 ( 85,516) An investee

under

equity

method

CTCI Corp. EVER ECOVE Corp. Taiwan Waste service, waste clear and

steam power cogeneration.

250,000 250,000 25,000,000 25.00 245,832 ( 3,213) ( 803) An investee

under

equity

method

CTCI Corp. HDEC-CTCI (Linhai)

Corporation

Taiwan Reclaimed water operators. 202,500 202,500 20,250,000 45.00 205,541 9,226 4,152 An investee

under

equity

method

$ 9,231,925 ($ 698,767)

CTCI Development

Corp.

CTCI Chemical

Corp.

Taiwan Manufacture, wholesale,

and retail of industrial

chemicals.

$ 13,522 $ 13,522 480,661 6.77 $ 18,682 $ 37,294 $ 2,524 A second-

tier

subsidiary

CTCI Development

Corp.

ECOVE Environment

Corp.

Taiwan General investment. 11,270 11,270 243,918 0.36 19,230 403,953 1,468 A subsidiary

CTCI Development

Corp.

CTCI Resources

Engineering Inc.

Taiwan Mining of geology, sea oil

and gas, marbal and

rare; planning, design,

monitor of civil, traffic

environment and various

mechanical and

electrical equipment.

23 23 1,388 0.01 19 48,751 2 A subsidiary

Table 7 Page 3

Balance as at

June 30, 2019

Balance as at


Net profit (loss)


six-month period

ended June 30, 2019

(Note 2(2))


recognised by the




Investee



CTCI Development

Corp.

Crown Asia-2

Investment Limited

Taiwan General investment. $ 2,531 $ 2,531 25,000 100.00 $ 578 ($ 28) ($ 28) A second-

tier

subsidiary

CTCI Investment

Corporation

CTCI Chemical

Corp.

Taiwan Manufacture wholesale,


chemicals.

32,153 32,153 1,657,207 23.34 64,413 37,294 8,705 A second-

tier

subsidiary

CTCI Investment

Corporation

ECOVE Environment

Corp.

Taiwan General investment. 1,374 1,374 32,132 0.05 2,529 403,953 193 A subsidiary

CTCI Investment

Corporation


Corp.

Taiwan Design, management, and

building of nuclear power,

thermal power, fire pumped

storage power generation and

others related to engineering.

11 11 1,000 0.002 3 ( 148,303) - A subsidiary

CTCI Investment

Corporation

Powertec Energy

Corp.

Taiwan Basically chemical industry

power generation, rotation

electric, machinery

manufacturing of electric

power and services of

energy technologies.

1,832,107 1,832,107 211,291,688 16.03 1,038,147 ( 1,178,861) ( 188,943) An investee

under

equity

method

CTCI Investment

Corporation

MIE INDUSTRIAL

SDN. BHD.

Malaysia Equipment & Instrument,

Procurement & Contruction

& Panel.

139,885 139,885 10,500,000 21.00 248,423 31,869 6,692 An investee

under

equity

method

CTCI Machinery

Corp.

Boretech

Resource Recovery

Engineering Co., Ltd.

(Cayman)

Cayman

Islands

Share holding and

investment.

154,744 154,744 6,666,667 10.00 152,590 67,591 6,504 An investee

under

equity

method

Table 7 Page 4

Balance as at

June 30, 2019

Balance as at


Net profit (loss)


six-month period

ended June 30, 2019

(Note 2(2))


recognised by the




Investee



ECOVE Environment

Corp.

ECOVE Waste

Management

Corporation

Taiwan International trade and

environmental service of

waste disposal, equipment

installation and mechanical

installation, etc.

$ 20,000 $ 20,000 2,000,000 100.00 $ 67,860 $ 22,040 $ 21,747 A second-

tier

subsidiary

ECOVE Environment

Corp.

ECOVE Wujih Energy

Corporation

Taiwan Environmental service of

waste disposal device

installation, steam power

cogeneration, etc.

450,435 425,085 30,000,000 100.00 833,870 134,894 133,116 A second-

tier

subsidiary

ECOVE Environment

Corp.

ECOVE Environmental


Taiwan Management of waste

recycling site and

maintenance

of related mechanical and

equipment, etc.

339,921 339,921 14,065,936 93.15 588,638 179,354 167,072 A second-

tier

subsidiary

ECOVE Environment

Corp.

ECOVE Mioali

Energy Corporation




cogeneration, etc.

1,012,483 1,012,483 56,249,000 74.999 965,517 64,780 48,584 A second-

tier

subsidiary

ECOVE Environment

Corp.

ECOVE Solar Energy

Corporation

Taiwan Energy technology service. 762,349 762,349 63,245,452 100.00 842,538 23,012 23,012 A second-

tier

subsidiary

ECOVE Environment

Corp.

Yuan Ding

Resources

Management Corp.

Taiwan Waste service, waste clear

other environmental service,

and environmental pollution

service, etc.

42,696 27,000 4,500,000 100.00 39,293 55 40 A second-

tier

subsidiary

ECOVE Environment

Corp.

Boretech Resource

Recovery Engineering

Co., Ltd. (Cayman)

Cayman

Islands

Share holding and

investment.

309,489 309,489 13,333,333 20.00 288,653 67,591 13,008 An investee

under

equity

method

ECOVE Environment

Corp.

ECOVE Solvent

Recycling

Corporation

Taiwan Operating basic chemical

industry and manufacture of

other chemical products.

86,480 86,480 8,099,000 89.99 76,147 ( 4,468) ( 4,021) A second-

tier

subsidiary

Table 7 Page 5

Balance as at

June 30, 2019

Balance as at


Net profit (loss)


six-month period

ended June 30, 2019

(Note 2(2))


recognised by the




Investee



ECOVE Environment

Corp.

EVER ECOVE Corp. Taiwan Waste service, waste clear and

steam power cogeneration.

$ 50,000 $ 50,000 5,000,000 5.00 $ 49,175 ($ 3,213) ($ 169) An investee

under

equity

method

ECOVE

Environmental


ECOVE Wujih Energy

Corporation




cogeneration, etc.

- 6,000 - - - 134,894 1,778 A second-

tier

subsidiary

ECOVE

Environmental


CTCI Chemical

Corp.

Taiwan Manufacture, wholesale,


chemicals.

24,851 24,851 1,910,241 26.9048 60,380 37,294 10,034 A second-

tier

subsidiary

ECOVE

Environmental


Sinogal-Waste

Services Corp.

Macao Management of waste

recycling site and

maintenance of related

mechanical and

equipment, etc.

4,964 4,964 1,200,000 30.00 37,158 100,094 30,236 A second-

tier

subsidiary

ECOVE

Environmental


ECOVE Mioali

Energy Corporation




cogeneration, etc.

13 13 1,000 0.001 18 64,780 - A second-

tier

subsidiary

ECOVE

Environmental


ECOVE Solvent

Recycling

Corporation

Taiwan Operating basic chemical

industry and manufacture of

other chemical products.

10 10 1,000 0.010 8 ( 4,468) - A second-

tier

subsidiary

ECOVE Waste

Management

Corporation

ECOVE Environmental


Taiwan Management of waste

recycling site and

maintenance of related

mechanical and

equipment, etc.

53 53 1,000 0.01 63 179,354 - A second-

tier

subsidiary

Table 7 Page 6

Balance as at

June 30, 2019

Balance as at


Net profit (loss)


six-month period

ended June 30, 2019

(Note 2(2))


recognised by the




Investee



ECOVE Waste

Management

Corporation

Yuan Ding

Resources

Management Corp.

Taiwan Waste service, waste clear

other environmental service,

and environmental pollution

service, etc.

$ - $ 18,000 - - $ - $ 55 $ 15 A second-

tier

subsidiary

ECOVE Solar Energy

Corporation

ECOVE Solar Power

Corporation


tier

subsidiary

ECOVE Solar Energy

Corporation

ECOVE Central

Corporation Ltd.

Taiwan Energy technology service. 7,500 7,500 750,000 100.00 8,245 156 156 A second-

tier

subsidiary

ECOVE Solar Energy

Corporation

ECOVE South

Corporation Ltd.


tier

subsidiary

ECOVE Solar Energy

Corporation

G.D. International, LLC. USA Energy technology service. 189,197 189,197 - 100.00 385,316 12,907 12,907 A second-

tier

subsidiary

G.D International,

LLC.

Lumberton Solar W2-090,

LLC.

USA Energy technology service. 189,197 189,197 - 100.00 384,410 12,913 12,913 A second-

tier

subsidiary

CTCI Overseas

(BVI) Corp.

CTCI Overseas

Co., Ltd.

Hong Kong Investment and planning


276,815 276,815 6,740,000 100.00 2,125,114 384,516 384,516 A second-

tier

subsidiary

CTCI Overseas

Co., Ltd.

CTCI Arabia Ltd. Arabia Construction and


storage tanks and chemical

plant.

22,610 22,610 500 50.00 ( 568,000) 1,191 595 A

subsidiary

CTCI Overseas

Co., Ltd.

Universal Engineering

(BVI) Corp.

BVI Investment and planning


1,694 1,694 50,000 100.00 ( 218,430) ( 250,802) ( 250,802) A second-

tier

subsidiary

Table 7 Page 7

Balance as at

June 30, 2019

Balance as at


Net profit (loss)


six-month period

ended June 30, 2019

(Note 2(2))


recognised by the




Investee



CTCI Overseas

Co., Ltd.

CIPEC

Construction Inc.

Philippines Construction and


storage tanks and

chemical plant.

$ 663 $ 663 9,973 39.89 ($ 14,912) ($ 13,978) ($ 5,585) A second-

tier

subsidiary

CTCI Overseas

Co., Ltd.

CIMAS

Engineering Corp.

Vietnam Chemical, petrochemical,

feasibility study &

planning, engineering

design, procurement &

fabrication, erection,

construction &

commissioning.

65,079 26,330 - 83.00 83,773 ( 1,767) ( 1,503) A second-

tier

subsidiary

CTCI Overseas

Co., Ltd.

CTCI Engineering &




2,879 2,879 300,000 40.00 ( 18,200) ( 40,242) ( 16,097) A subsidiary

CTCI Overseas

Co., Ltd.

CINDA

Engineering &

Construction

Private Limited

India Chemical, petrochemical,

feasibility study &

planning, engineering

design, procurement &

fabrication, erection,

construction &

commissioning.

31,022 31,022 8,000,000 100.00 ( 65,496) ( 31,734) ( 31,734) A second-

tier

subsidiary

CTCI Overseas

Co., Ltd.

SUMBER MAMPU

SDN. BHD.

Malaysia Building of related

engineering.

95 95 10,000 10.00 175,752 6,427 6,427 A second-

tier

subsidiary

Universal

Engineering

(BVI) Corp.

Superiority


Thailand Investment and planning


151 151 2,156 49.00 ( 327,492) ( 252,319) ( 252,319) A second-

tier

subsidiary

Superiority

(Thailand) Co.,

Ltd.

CTCI (Thailand)

Co., Ltd.

Thailand Design and building of

petrochemical plant.

12,628 12,628 1,300,500 51.00 (277,398) ( 493,367) ( 251,617) A

subsidiary

CTCI Advanced

Systems Inc.

Century Ahead Ltd. Samoa Professional investment

company.

25,097 25,097 750,000 100.00 39,378 6,396 6,396 A second-

tier

subsidiary

Table 7 Page 8

Balance as at

June 30, 2019

Balance as at


Net profit (loss)


six-month period

ended June 30, 2019

(Note 2(2))


recognised by the




Investee



CTCI Smart

Engineering

Corp.

CTCI Chemical

Corp.



chemicals.

$ 7,354 $ 7,354 656,360 9.24 $ 24,538 $ 37,294 $ 3,448 A second-

tier

subsidiary

CTCI Resources

Engineering Inc.

CTCI Chemical

Corp.



chemicals.

7,354 7,354 656,360 9.24 24,769 37,294 3,448 A second-

tier

subsidiary

CTCI Singapore

Pte. Ltd.

CTCI Netherlands B.V. Netherlands Engineers and other technical

design and consultancy.

11,274 11,274 300,000 100.00 51,183 965 965 A second-

tier

subsidiary

CTCI Engineering &

Construction Sdn.

Bhd.

CTCI Malaysia SDN.

BHD.



1,357 1,357 150,000 20.00 2,737 8,083 1,617 A second-

tier

subsidiary

CTCI Malaysia

SDN. BHD.

MIE INDUSTRIAL

SDN. BHD.

Malaysia Equipment & Instrument,

Procurement & Construction,

Panel.

185,537 185,537 14,000,000 28.00 327,142 31,869 8,923 An investee

under

equity

method

SUMBER MAMPU

SDN. BHD.

CTCI Malaysia SDN.

BHD.



5,428 5,428 600,000 80.00 10,949 8,083 6,467 A second-

tier

subsidiary

Note 1: If a public company is equipped with an overseas holding company and takes consolidated financial report as the main financial report according to the local law rules,

it can only disclose the information of the overseas holding company about the disclosure of related overseas investee information.

Note 2: If situation does not belong to Note 1, fill in the columns according to the following regulations:

(1) The columns of ‘Investee’, ‘Location’, ‘Main business activities’, Initial investment amount’ and ‘Shares held as at June 30, 2019’ should fill orderly in the Company’s (public company’s)

information on investees and every directly or indirectly controlled investee’s investment information, and note the relationship between the Company (public company) and its investee each

(ex. direct subsidiary or indirect subsidiary) in the ‘footnote’ column.

(2) The ‘Net profit (loss) of the investee for the six-month period ended June 30, 2019’ column should fill in amount of net profit (loss) of the investee for this period.

(3) The ‘Investment income (loss) recognised by the Company for the six-month period ended June 30, 2019’ column should fill in the Company (public company) recognised investment income (loss)

of its direct subsidiary and recognised investment income (loss) of its investee accounted for under the equity method for this period. When filling in recognised investment income (loss) of its

direct subsidiary, the Company (public company) should confirm that direct subsidiary’s net profit (loss) for this period has included its investment income (loss) which shall be recognised by regulations.

Table 7 Page 9

Remitted to

Mainland

China

Remitted

back to

Taiwan

CTCI Beijing

Co., Ltd.

Design, survey, construction

and inspection of various

engineering and construction

projects, plants, machinery

and equipment, and

environmental protection

projects.

$ 433,473 2 $ 313,998 $ - $ - $ 313,998 $ 211,546 100.00 $ 211,546 $ 2,019,576 $ 295,938 Note 3

CTCI Shanghai

Co., Ltd.

Design, survey, construction and

inspection of various

engineering and construction

projects.

592,787 2 488,709 - 488,709 - 32,803 100.00 32,803 536,028 23,530 Note 7

CTCI Advanced

Systems

Shanghai Inc.

Computer technology services. 23,295 2 23,295 - - 23,295 6,394 48.72 3,115 38,196 - Note 4

ECOVE

Environment

Consulting Corp.

Technical development, advisory

and service in environmental

field;environmental pollution

control equipment and related

parts wholesale, import and

export, etc.

4,147 1 4,147 - - 4,147 3,516 53.77 1,890 16,790 17,306 -

FuJian Gulie

Petrochemical

Co., Ltd.

Operating in manufacturing and

selling of ethylene and others.

10,277,948 2 292,225 - - 292,225 - 1.31 - 292,225 - Note 5

CTCI Trading

Shanghai

Co., Ltd.

General trade. 23,748 2 - - - - 4,135 100.00 4,135 31,929 - Note 6

Footnote

Accumulated

amount

of remittance from

Taiwan to

Mainland China as

of June 30, 2019

Net income of

investee for the

three-month

period ended

June 30, 2019

Investee in

Mainland China Main business activities Paid-in capital

Investment

method

（Note 1）

Accumulated

amount of

remittance from

Taiwan to

Mainland China

as of

January 1, 2019

Ownership held

by

the Company

(direct or

indirect)

Investment income

(loss) recognised

by the Company

for the six-month

period ended June

30, 2019

（Note 2(2)B）

Book value of

investments in

Mainland China as

of June 30, 2019

Accumulated

amount

of investment

income

remitted back to

Taiwan as of

June 30, 2019

Amount remitted from

Taiwan to Mainland China/

Amount remitted back

to Taiwan for the period

ended June 30, 2019


Information on investees (not including investees in Mainland China)




Table 8 Page 1

Company name

Accumulated amount of

remittance from Taiwan to

Mainland China

as of June 30, 2019

Investment

amount approved

by the Investment

Commission of

the Ministry of

Economic Affairs

(MOEA)

Ceiling on

investments in

Mainland China

imposed by the

Investment

Commission of

MOEA

CTCI Corp. $ 633,665 $ 1,195,333 $ 9,814,517

Note 1: Investment methods are classified into the following three categories; fill in the number of category each case belongs to:

(1)Directly invest in a company in Mainland China..

(2)Through investing in an existing company in the third area, which then invested in the investee in Mainland China.

(3)Others

Note 2: In the Investment income (loss) recognised by the Company for the six-month period ended June 30, 2019 column:

(1)FuJian Galie Petrochemical Co., Ltd did not accrue investment income or loss since it was still in preparation.

(2)Indicate the basis for investment income (loss) recognition in the number of one of the following three categories:

A.The financial statements that are reviewed and attested by R.O.C. parent company’s CPA.

B.It is an insignificant subsidiary, and its financial report was not reviewed by the independent accountant.

C.Others.

Note 3: Invested by CTCI Overseas Co., Ltd.

Note 4: Invested by Century Ahead Ltd.

Note 5: Invested in Dynamic Ever Investments Limited through Ever Victory Global Limited.

Note 6: Invested by CTCI Shanghai Co., Ltd.

Note 7: Invested by CTCI Beijing Co., Ltd.

Table 8 Page 2

Documents

CTCI CORPORATION AND SUBSIDIARIES · CTCI CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS) (The balance sheets as of June 30,