Taiwan Cogeneration : 2023YearsQ1 Consolidated Financial Statements

Taiwan Cogeneration Corporation and Subsidiaries

Consolidated Financial Statements for the

Three Months Ended March 31, 2023 and 2022 and Independent Auditors' Review Report

Emphasis of Matter

For details on Taiwan Power Company's filing of a civil lawsuit against the Group's associates, Sun Ba Power Corporation, Star Energy Power Corporation, Star Buck Power Corporation, and Kuo Kuang Power Company Ltd., in connection with their alleged violation of the Fair Trade Act and request for compensation on the basis of claims for damages which it has suffered, refer to Note 35d. Our review conclusion is not modified in respect of this matter.

The engagement partners on the reviews resulting in this independent auditors' review report are Chao-Mei Chen and Cheng-Chuan Yu.

Deloitte & Touche

Taipei, Taiwan

Republic of China

May 10, 2023

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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TAIWAN COGENERATION CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (In Thousands of New Taiwan Dollars)

			March 31, 2023						December 31, 2022						March 31, 2022
ASSETS			(Reviewed)						(Audited)						(Reviewed)
		Amount	%					Amount	%					Amount	%
CURRENT ASSETS
Cash and cash equivalents (Note 6)	$	3,429,445		14		$	3,734,653			15		$	2,698,846		11
Contract assets (Notes 23, 25 and 33)			1,956,240		8					1,959,825			8					2,401,910		10
Notes receivable (Notes 7 and 25)			-		-					-			-					16,907		-
Accounts receivable (Notes 7 and 25)			216,400		1					521,402			2					548,250		3
Accounts receivable from related parties (Notes 25 and 33)			121,293		-					151,212			1					37,534		-
Finance lease receivables (Notes 8 and 33)			10,349		-					10,324			-					10,338		-
Other receivables (Note 33)			21,380		-					36,885			-					10,388		-
Inventories (Note 9)			19,896	-				18,104		-				14,460	-
Prepaid construction costs (Note 23)			57,793		-					46,184			-					17,484		-
Prepaid value-added tax			121,594		1					102,751			1					79,964		1
Other financial assets (Note 34)			20,337		-					20,341			-					343		-
Other current assets			66,473		-					34,523			-					41,270		-
Total current assets			6,041,200		24					6,636,204			27					5,877,694		25
NON-CURRENT ASSETS
Financial assets at fair value through other comprehensive income (Notes 10 and 32)			264,120		1					277,120			1					272,510		1
Investments accounted for using the equity method (Note 12)			13,672,877		54					13,004,719			52					12,902,975		54
Property, plant and equipment (Notes 13 and 34)			3,403,923		13					3,231,917			13					3,082,126		13
Right-of-use assets (Notes 14 and 33)			420,527		2					417,718			2					435,613		2
Goodwill			141,014		1					141,014			-					141,014		-
Intangible assets (Notes 15 and 34)			925,277		4					937,452			4					888,068		4
Deferred income tax assets (Notes 4 and 27)			188,800		1					188,007			1					197,283		1
Finance lease receivables (Notes 8 and 33)			8,729	-				11,325		-				19,251	-
Prepayments for equipment			1,674		-					7,149			-					4,089		-
Refundable deposits			64,987		-					69,134			-					78,172		-
Other financial assets (Note 34)			21,867		-					34,104			-					47,373		-
Other non-current assets (Note 16)			20,273		-					20,537			-					22,212		-
Total non-current assets			19,134,068		76					18,340,196			73					18,090,686		75
TOTAL	$	25,175,268	100	$	24,976,400		100	$	23,968,380	100
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Note 17)	$	52,000		-		$	67,000			-		$	40,000		-
Short-term bills payable (Note 17)			999,594		4					999,276			4					998,773		4
Contract liabilities (Notes 23, 25 and 33)			353,112		1					583,082			3					157,948		1
Notes payable			-	-				-		-				305	-
Accounts payable			140,341		1					156,870			1					69,680		-
Construction costs payable			3,086,979		12					3,220,782			13					3,275,152		14
Accounts payable to related parties (Note 33)			10,419		-					2,045			-					7,597		-
Other payables (Notes 19 and 33)			226,295		1					315,915			1					289,405		1
Current income tax liabilities (Note 4)			95,264		-					70,657			-					71,820		1
Provisions (Notes 21 and 23)			258,192		1					259,197			1					287,377		1
Lease liabilities (Notes 14 and 33)			62,826		-					53,315			-					57,504		-
Current portion of long-term borrowings (Note 17)			1,121,938	5					947,393		4					137,988	1
Other current liabilities			16,004		-					24,905			-					5,342		-
Total current liabilities			6,422,964		25					6,700,437			27					5,398,891		23
NON-CURRENT LIABILITIES
Long-term borrowings (Note 17)			2,897,266		12					3,127,031			13					3,050,154		13
Contract liabilities (Note 25)			141,841		1					122,188			1					75,547		-
Lease liabilities (Notes 14 and 33)			419,314	2					424,382		2					435,215	2
Bonds payable (Note 18)			2,498,042		10					2,497,884			10					2,497,411		10
Provisions (Note 21)			14,373		-					14,296			-					14,061		-
Deferred income tax liabilities (Note 4)			69,944		-					70,691			-					73,994		-
Net defined benefit liabilities (Notes 4 and 22)			112,582		-					112,088			-					124,675		1
Guarantee deposits received			56,841		-					41,297			-					33,388		-
Other liabilities (Note 20)			15,905		-					15,866			-					2,809		-
Total non-current liabilities			6,226,108	25				6,425,723		26				6,307,254	26
Total liabilities			12,649,072		50					13,126,160			53					11,706,145		49
EQUITY ATTRIBUTABLE TO OWNERS OF THE CORPORATION (Note 24)
Share capital
Ordinary shares			5,890,486		23					5,890,486			24					5,890,486		24
Capital surplus			499,694		2					499,694			2					499,694		2
Retained earnings
Legal reserve			1,737,133	7					1,737,133		7					1,644,763	7
Special reserve			2,621,945		10					2,621,945			10					2,823,917		12
Unappropriated earnings			1,635,960		7					958,281			4					1,243,868		5
Total retained earnings			5,995,038		24					5,317,359			21					5,712,548		24
Other equity			(18,245)		-					(14,130)			-					8,371		-
Total equity attributable to owners of the Corporation			12,366,973		49					11,693,409			47					12,111,099		50
NON-CONTROLLING INTERESTS			159,223	1					156,831		-				151,136	1
Total equity			12,526,196		50					11,850,240			47					12,262,235		51
TOTAL	$	25,175,268		100		$	24,976,400			100		$	23,968,380		100

The accompanying notes are an integral part of the consolidated financial statements. (With Deloitte & Touche review report dated May 10, 2023)

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TAIWAN COGENERATION CORPORATION AND SUBSIDIARIES

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

		For the Three Months Ended March 31
	2023			2022
		Amount	%				Amount	%
OPERATING REVENUE (Notes 25 and 33)
Sales	$ 462,284		43		$ 327,856		37
Construction services	590,308		54		522,719		59
Operations, maintenance and consulting services		31,620		3			39,622		4
Total operating revenues	1,084,212		100		890,197		100
OPERATING COSTS (Notes 22, 26 and 33)
Cost of sales	344,911		32		275,883		31
Construction services	541,354		50		487,857		55
Operations, maintenance and consulting services		30,698		3			39,444		4
Total operating costs		916,963		85			803,184		90
GROSS PROFIT	167,249		15		87,013		10
REALIZED GAIN ON TRANSACTIONS WITH
ASSOCIATES		4,858		1			2,465		-
REALIZED GROSS PROFIT	172,107		16		89,478		10
OPERATING EXPENSES (Notes 22 and 26)		107,473		10			89,894		10
PROFIT (LOSS) FROM OPERATIONS	64,634		6		(416)	-
NON-OPERATING INCOME AND EXPENSES
Interest income	3,049		-		76		-
Other income (Notes 26 and 33)	4,870		1		4,597		-
Other gains and losses (Note 26)	3,621		-		25,022		3
Finance costs (Note 26)	(29,199)	(3)	(17,812)	(2)
Share of profit of associates accounted for using the
equity method (Note 12)		654,978		61			294,672		33
Total non-operating income and expenses		637,319		59			306,555		34
PROFIT BEFORE INCOME TAX	701,953		65		306,139		34
INCOME TAX EXPENSE (Notes 4 and 27)		(21,882)	(2)	(18,960)	(2)
NET PROFIT		680,071		63			287,179		32
									(Continued)

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