Delta Electronics : 8/29/2022Q2 2022 Consolidated Financial Report

DELTA ELECTRONICS, INC. AND

SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND

INDEPENDENT AUDITORS' REVIEW REPORT

JUNE 30, 2022 AND 2021

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

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.

~1~

REPORT ON REVIEW OF INTERIM FINANCIAL INFORMATION

To the Board of Directors and Shareholders of Delta Electronics, Inc.

Introduction

We have reviewed the accompanying consolidated balance sheets of Delta Electronics, Inc. and its subsidiaries (the "Group") as at June 30, 2022 and 2021, and the related consolidated statements of comprehensive income for the three months and six months then ended, as well as the related consolidated statements of changes in equity and of cash flows for the six months then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies. Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the "Regulations Governing the Preparation of Financial Reports by Securities Issuers" and International Accounting Standards (IAS) No. 34, "Interim Financial Reporting" as endorsed by the Financial Supervisory Commission (FSC). Our responsibility is to express a conclusion on these interim financial statements based on our reviews and the review reports of other independent auditors.

Scope of review

Except as explained in the Basis for Qualified Conclusion, we conducted our reviews in accordance with the Statement of Auditing Standards No. 65, "Review of Financial Statements". A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Basis for Qualified Conclusion

As explained in Notes 4(3)B and 6(8), the financial statements of certain insignificant consolidated subsidiaries and investments accounted for under the equity method were not reviewed by independent auditors. Those statements reflect total assets of NT$22,664,075 thousand and NT$18,127,683 thousand, constituting 5.75% and 5.17% of the consolidated total assets, and total liabilities of NT$6,212,789 thousand and NT$5,889,623 thousand, constituting 3.16% and 3.35% of the consolidated total liabilities as at June 30, 2022 and 2021, respectively, and total comprehensive loss of (NT$370,128) thousand and (NT$65,542) thousand, constituting (3.04%) and (1.68%) of the consolidated total comprehensive income for the three months then ended, respectively, and total

~2~

comprehensive loss of (NT$15,229) thousand and (NT$317,496) thousand, constituting (0.06%) and (2.53%) of the consolidated total comprehensive income for the six months then ended, respectively.

Qualified Conclusion

Based on our reviews and the review reports of other independent auditors as described in the Other Matter-Review Reports By Other Independent Auditors section of our report, except for the possible effects of the matter described in the Basis for Qualified Conclusion section of our report, nothing has come to our attention that causes us to believe that the accompanying interim financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as at June 30, 2022 and 2021, and of its consolidated financial performance for the three months and six months then ended, and its consolidated cash flows for the six months then ended in accordance with the "Rules Governing the Preparation of Financial Reports by Securities Issuers" and IAS No. 34, "Interim Financial Reporting" as endorsed by the FSC.

Other Matter-Review Reports By Other Independent Auditors

We did not review the financial statements of certain subsidiaries which were reviewed by other independent auditors. Those statements reflect total assets amounting to NT$65,120,611 thousand and NT$52,950,810 thousand, constituting 16.53% and 15.09% of the consolidated total assets as at June 30, 2022 and 2021, respectively, and total operating revenues amounting to NT$20,848,803 thousand and NT$16,319,417 thousand, constituting 23.17% and 20.72% of the consolidated total operating revenues for the three months then ended, respectively, and total operating revenues amounting to NT$39,216,681 thousand and NT$31,794,537 thousand, constituting 22.73% and 21.02% of the consolidated total operating revenues for the six months then ended, respectively.

~3~

The consolidated financial statements of Delta Electronics, Inc. and subsidiaries as at and for the six months ended June 30, 2022 expressed in US dollars are presented solely for the convenience of the reader and were translated from the financial statements expressed in New Taiwan dollars using the exchange rate of $29.72 to US$1.00 at June 30, 2022. This basis of translation is not in accordance with International Financial Reporting Standards, International Accounting Standards, and relevant interpretations and interpretative bulletins that are ratified by the FSC.

Hsiao, Chun-Yuan

Chou, Chien-Hung

for and on behalf of PricewaterhouseCoopers, Taiwan

July 28, 2022

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

The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the review of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and review report of independent auditors are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

~4~

DELTA ELECTRONICS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

JUNE 30, 2022, DECEMBER 31, 2021 AND JUNE 30, 2021

(EXPRESSED IN THOUSANDS OF DOLLARS)

(THE BALANCE SHEETS AS OF JUNE 30, 2022 AND 2021 ARE UNAUDITED)

					US Dollars					New Taiwan Dollars
Assets		Notes		June 30, 2022			June 30, 2022		December 31, 2021		June 30, 2021
Current assets
Cash and cash equivalents	6(1)		$	2,054,130	$	61,048,738	$	49,855,053		$	57,483,109
Financial assets at fair value through	6(2)
profit or loss - current					48,786			1,449,914			1,085,729			1,042,097
Financial assets at amortised cost -	8
current					10,644			316,331			327,238			453,887
Contract assets - current	6(21)			121,472			3,610,156			3,589,313			2,932,483
Notes receivable, net	6(5)			107,715			3,201,289			3,420,633			3,464,533
Accounts receivable, net	6(5)			2,407,606			71,554,046			67,436,377			59,987,429
Accounts receivable - related parties	7			1,037			30,816			27,831			29,415
Other receivables		6(6) and 7		62,293			1,851,363			1,815,370			1,990,133
Current income tax assets					15,627			464,441			349,207			443,700
Inventories	6(7)			2,400,542			71,344,118			66,107,351			56,150,566
Prepayments					90,108			2,678,000			2,450,269			2,692,937
Non-current assets held for sale	6(9)			-			-			320,551			720,196
Other current assets					2,799			83,182			93,272			64,925
Total current assets					7,322,759			217,632,394			196,878,194			187,455,410
Non-current assets
Financial assets at fair value through	6(2)
profit or loss - non-current					91,238			2,711,600			3,351,798			3,109,829
Financial assets at fair value through	6(3)
other comprehensive income -
non-current					55,139			1,638,731			1,587,843			1,793,192
Contract assets - non-current	6(21)			24,113			716,632			462,941			393,792
Investments accounted for under the	6(8)
equity method					2,486			73,869			63,731			65,206
Property, plant and equipment		6(9) and 8		2,702,234			80,310,399			76,607,285			73,025,221
Right-of-use assets	6(10)			143,393			4,261,646			3,006,960			2,939,311
Investment property, net					474			14,070			14,070			14,070
Intangible assets	6(11)			2,567,587			76,308,689			73,609,564			73,641,438
Deferred income tax assets					249,947			7,428,432			7,177,747			6,264,649
Other non-current assets	6(5)(12)
		and 8		95,969			2,852,209			2,352,477			2,217,016
Total non-current assets					5,932,580			176,316,277			168,234,116			163,463,724
Total assets				$	13,255,339		$	393,948,671		$	365,112,310		$	350,919,134

(Continued)

~5~