HTC : 2021 Q2Financial Results - Consolidated Financial Report (IFRS)

HTC Corporation and Subsidiaries

Consolidated Financial Statements for the

Six Months Ended June 30, 2021 and 2020 and Independent Auditors' Review Report

The engagement partners on the reviews resulting in this independent auditors' review report are Chi-Ming Hsu and Kenny Hong.

Deloitte & Touche

Taipei, Taiwan

Republic of China

July 28, 2021

Notice to Readers

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

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

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HTC CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (In Thousands of New Taiwan Dollars)

			June 30, 2021						December 31, 2020				June 30, 2020
			(Reviewed)						(Audited)						(Reviewed)
ASSETS			Amount	%					Amount	%					Amount	%
CURRENT ASSETS
Cash and cash equivalents (Note 6)	$	20,441,167		46		$	16,375,830		36	$	17,313,929		37
Financial assets at fair value through profit or loss - current (Note 7)			100,021	-					173,357	-					105,706	-
Financial assets at fair value through other comprehensive income - current (Note 8)			71,755	-					68,774	-					2,417,792		5
Notes, trade receivables, net (Note 10)			595,623	1					475,713	1					584,265	1
Other receivables (Note 10)			68,613	-					78,017	-					68,815	-
Current tax assets			174,041	-					242,033	1					254,483	1
Inventories (Note 11)			1,688,202		4					1,527,103		4					1,617,370		3
Prepayments (Note 12)			334,789	1					269,094	1					343,432	1
Other current financial assets (Notes 9 and 33)			3,310,604		8					9,470,781		21				8,161,193		17
Other current assets			2,803	-					2,225	-					1,869	-
Total current assets			26,787,618		60					28,682,927		64				30,868,854		65
NON-CURRENT ASSETS
Financial assets at fair value through profit or loss - non-current (Note 7)			341,226	1					336,918	1					360,329	1
Financial assets at fair value through other comprehensive income - non-current (Note 8)			2,328,342		5					1,560,351		4					1,634,148		4
Investments accounted for using the equity method (Note 14)			1,146,262		3					549,657	1					552,377	1
Property, plant and equipment (Notes 15, 32 and 33)			7,704,083		17					7,666,798		17				7,671,823		16
Right-of-use assets (Note 16)			82,629	-					139,026	-					277,103	1
Investment properties, net (Notes 17 and 33)			2,390,239		5					2,181,884		5					2,045,400		4
Intangible assets (Note 18)			34,224	-					101,943	-					108,767	-
Deferred tax assets			3,289,350		8					3,328,452		7					3,351,483		7
Refundable deposits			12,288	-					27,139	-					108,114	-
Net defined benefit asset - non-current			329,808	1					331,282	1					286,709	1
Other non-current financial assets (Notes 9 and 33)			69,664	-					142,483	-					148,245	-
Other non-current assets (Note 12)			15,416	-					17,477	-					28,367	-
Total non-current assets			17,743,531		40					16,383,410		36				16,572,865		35
TOTAL	$	44,531,149		100		$	45,066,337		100	$	47,441,719		100
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Note 19)	$	1,520,000		3		$	900,000	2		$	-		-
Financial liabilities at fair value through profit or loss - current (Note 7)			198,429	1					90,599	-					79,236	-
Note and trade payables (Notes 20 and 32)			5,708,122		13					6,028,712		14				5,937,423		13
Other payables (Notes 21 and 32)			5,125,480		12					5,689,212		13				6,146,800		13
Current tax liabilities			84,961	-					63,961	-					142,548	-
Provisions - current (Note 22)			1,312,788		3					1,410,042		3					1,552,229		3
Lease liabilities - current (Notes 16 and 32)			39,004	-					68,220	-					115,084	-
Other current liabilities (Note 21)			549,847	1					524,278	1					826,244	2
Total current liabilities			14,538,631		33					14,775,024		33				14,799,564		31
NON-CURRENT LIABILITIES
Long-term borrowings (Notes 19 and 33)			1,500,000		3					-		-					-		-
Deferred tax liabilities			86,183	-					86,253	-					104,322	-
Lease liabilities - non-current (Notes 16 and 32)			46,380	-					81,834	-					187,057	1
Guarantee deposits received			169,140	1					169,650	1					170,797	-
Total non-current liabilities			1,801,703		4					337,737	1					462,176	1
Total liabilities			16,340,334	37					15,112,761		34				15,261,740		32
EQUITY (Note 23)
Share capital - ordinary shares			8,189,294		18					8,186,444		18				8,188,043		17
Capital surplus			15,835,588		35					15,761,158		35				15,660,649		33
Retained earnings
Legal reserve			15,725,509		35					15,725,509		35				15,725,509		33
Special reserve			3,080,480		7					3,080,480		7					3,080,480		7
Accumulated deficits			(9,144,437)	(20)				(7,390,476)	(17)				(7,502,648)	(16)
Other equity			(5,495,619)	(12)				(5,470,576)	(12)				(3,079,542)	(6)
Total equity attributable to owners of the parent			28,190,815		63					29,892,539		66				32,072,491		68
NON-CONTROLLING INTERESTS			-		-					61,037	-					107,488	-
Total equity			28,190,815		63					29,953,576	66				32,179,979		68
TOTAL	$	44,531,149		100		$	45,066,337		100	$	47,441,719		100

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

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HTC CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Loss Per Share) (Reviewed, Not Audited)

			For the Three Months Ended June 30							For the Six Months Ended June 30
			2021						2020							2021						2020
			Amount	%					Amount	%						Amount	%					Amount	%
OPERATING REVENUE
(Notes 24 and 32)	$	1,349,180		100	$	1,343,394		100		$	2,524,267	100	$	2,673,144	100
OPERATING COST (Notes 11,
25 and 32)			945,886		70				987,620	74					1,780,765	70				1,968,340	74
GROSS PROFIT			403,294		30				355,774	26					743,502	30				704,804	26
OPERATING EXPENSES
(Notes 25 and 32)
Selling and marketing			417,843		31				407,956	30					821,604	33				974,400	36
General and administrative			434,817		32				691,991	52					955,760	38				1,355,380	51
Research and development			600,128		45				922,153	69					1,293,716	51				1,892,968	71
Total operating expenses			1,452,788		108				2,022,100		151					3,071,080	122				4,222,748	158
OPERATING LOSS			(1,049,494)	(78)				(1,666,326)	(125)				(2,327,578)	(92)				(3,517,944)	(132)
NON-OPERATING INCOME
AND EXPENSES
Interest income (Note 25)			29,914	2				66,258	5					61,995	2				144,815	5
Other income (Notes 25
and 32)			210,143		16				346,828	26					422,844	17				534,124	20
Other gains and losses
(Notes 15, 18, 25 and 28)			248,114		18				(571,746)	(42)				241,100	9				(675,436)	(25)
Finance costs (Notes 25
and 32)			(11,101)	(1)				(5,684)	-					(21,010)	(1)				(8,250)	-
Share of the loss of associate
(Note 14)			6,612	1				(12,368)	(1)				17,332	1				(17,028)	-
Total non-operating
income and expenses			483,682		36				(176,712)	(12)				722,261	28				(21,775)	-
LOSS BEFORE INCOME TAX			(565,812)	(42)				(1,843,038)	(137)				(1,605,317)	(64)				(3,539,719)	(132)
INCOME TAX BENEFIT
(Note 26)			353		-				148	-					1,728	-				2,928	-
LOSS FOR THE PERIOD			(565,459)	(42)				(1,842,890)	(137)				(1,603,589)	(64)				(3,536,791)	(132)
OTHER COMPREHENSIVE
INCOME AND LOSS, NET
OF INCOME TAX
Items that will not be
reclassified subsequently to
profit or loss:
Unrealized gain on
investments in equity
instruments designated as
at fair value through other
comprehensive income			277,596		21				1,304,120		97					486,474	19				1,290,937	48
Items that may be reclassified
subsequently to profit or
loss:
Exchange differences on
translation of foreign
operations			(535,236)	(40)				(394,103)	(29)				(691,198)	(27)				(637,290)	(24)
Other comprehensive
income and loss for the
period, net of income
tax			(257,640)	(19)				910,017	68					(204,724)	(8)				653,647	24
TOTAL COMPREHENSIVE
LOSS FOR THE PERIOD	$	(823,099)	(61)	$	(932,873)	(69)	$	(1,808,313)	(72)	$	(2,883,144)	(108)
																										(Continued)

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