Stock Code: 5907

GRAND OCEAN RETAIL GROUP LTD. AND SUBSIDIARIES

Consolidated Financial Statements

With Independent Auditors’ Review Report

For the Three Months Ended March 31, 2026 and 2025

Company Address: P.O. Box 31119 Grand Pavilion, Hibiscus Way, 802 West Bay Road, Grand Cayman KY1-1205, Cayman Islands.

Taipei Office: 14F., No. 237, Sec. 2, Fuxing S. Rd., Da’an Dist., Taipei City 106, Taiwan (R.O.C.)

TEL: (02) 2707-8833

The independent auditors’ report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and consolidated financial statements, the Chinese version shall prevail.

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TABLE OF CONTENTS

CONTENTS		Page
I.	Cover	1
II.	Table of Contents	2
III.	Independent Auditors’ Review Report	3
IV.	Consolidated Balance Sheet (NTD)	4
IV-1.	Consolidated Balance Sheet (RMB)	5
V.	Consolidated Income Statement (NTD)	6
V-1.	Consolidated Income Statement (RMB)	7
VI.	Consolidated Statement of Changes in Shareholders' Equity (NTD)	8
VI-1.	Consolidated Statement of Changes in Shareholders' Equity (RMB)	9
VII.	Consolidated Statement of Cash Flows (NTD)	10
VII-1.	Consolidated Statement of Cash Flows (RMB)	11
VIII.	Note of Consolidated Financial Statements
	1. Company history	12
	2. Approval date and procedures of the consolidated financial statements	12
	3. New standards, amendments and interpretations adopted	12~14
	4. Summary of significant accounting policies	14~17
	5. Significant accounting assumptions and judgments, and major sources of estimation uncertainty	17
	6. Explanation of significant accounts	17~44
	7. Related-party transactions	44~46
	8. Pledged assets	47
	9. Significant contingent liabilities and unrecognized contract commitments	47~50
	10. Losses due to major disasters	50
	11. Subsequent events	50
	12. Others	50~51
	13. Other disclosures	51~52
	(1) Information on significant transaction	51
	(2) Information on investees	52
	(3) Information on investment in mainland China	52
	14. Segment information	52
	15. Accompanying schedule	53~63

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Independent Auditors' Review Report

To the Board of Directors of Grand Ocean Retail Group Ltd.:

Introduction

We have reviewed the consolidated financial statements of the Grand Ocean Retail Group Ltd. and its subsidiaries (“the Group”), which comprise the consolidated balance sheets as of March 31, 2026 and 2025, the consolidated statements of comprehensive income for the three months ended March 31, 2026 and 2025, as well as the changes in equity and cash flows for the three months ended March 31, 2026 and 2025, 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 (“IASs”) 34, “Interim Financial Reporting” endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China. Our responsibility is to express a conclusion on the consolidated financial statements based on our review.

Scope of Review

Except as explained in the Basis for Qualified Conclusion paragraph, we conducted our reviews in accordance with the Standard on Review Engagements 2410, "Review of Financial Information Performed by the Independent Auditor of the Entity" of the Republic of China. A review of the consolidated financial statements 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 conducted in accordance with the generally accepted auditing standards 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

Some of the non-major subsidiaries included in the consolidated financial statements above are based on the financial statements of the investee companies that have not been reviewed by accountants during the same period. As of March 31, 2026 and 2025, the total assets were NT$253,668 thousand and NT$308,055 thousand, respectively, constituting 1.24% and 1.30% of the total consolidated assets, the total liabilities were NT$225,377 thousand and NT$312,739 thousand, respectively, constituting 1.35% and 1.64% of the total consolidated liabilities, the comprehensive profit and loss was NT$1,361 thousand and NT$636 thousand, constituting (3.65)% and (0.54)% of the consolidated comprehensive profit and loss for the three months ended March 31, 2026 and 2025, respectively.

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Conclusion

Based on our reviews, except for the adjustments, if any, as might have been determined to be necessary had the financial statements of the non-major subsidiaries and the equity-method investees as described in the Basis for Qualified Conclusion paragraph above been reviewed, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as of March 31, 2026 and 2025, and its consolidated financial performance for the three months ended March 31, 2026 and 2025, as well as its consolidated cash flows for the three months ended March 31, 2026 and 2025 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, "Interim Financial Reporting" endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

The engagement partners on the reviews resulting in this independent auditors' review report are Jun-Ming Pan and Chung-Che Chen.

KPMG
Taipei, Taiwan (Republic of China)
May 14, 2026

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 the accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such consolidated financial statements are those generally accepted and applied in the Republic of China.

For the convenience of readers, the independent auditors' 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. In case of 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' report and consolidated financial statements shall prevail.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries
Consolidated Balance Sheet
March 31, 2026, December 31, 2025, and March 31, 2025
(Expressed in Thousands of New Taiwan Dollars)

Assets	March 31, 2026		December 31, 2025		March 31, 2025
		Amount	%	Amount	%	Amount	%
Current assets:
1100	Cash and cash equivalents (Note 6(1))	$ 297,368	1	243,883	1	474,868	2
1110	Financial assets measured at fair value through profit or loss – current (Note 6(2))	11,999	-	12,394	-	12,177	-
1170	Accounts receivable, net (Note 6(3))	135,326	1	124,847	1	127,599	1
1200	Other receivables (Note 6(3))	22,038	-	19,387	-	47,537	-
1300	Inventories – merchandising business	104,576	1	107,024	1	165,469	1
1410	Pre-payments (Note 7)	210,609	1	214,343	1	263,515	1
1476	Other financial assets – current (Note 6(7), 8 and 9)	801,740	4	746,482	4	555,432	2
		1,583,656	8	1,468,360	8	1,646,597	7
Non-current assets:
1600	Property, plants and equipment (Note 6(4) and 8)	4,896,410	24	4,813,540	22	5,225,295	22
1755	Right-of-use asset (Note 6(5), 7 and 8)	9,573,589	47	10,442,396	49	11,632,682	49
1780	Intangible assets (Note 6(6))	1,557,221	8	1,505,352	7	1,696,556	7
1840	Deferred tax assets (Note 6(13))	2,346,565	11	2,560,055	12	2,812,095	12
1980	Other financial assets – non-current (Note 6(7), 7 and 8)	289,609	1	274,844	1	494,216	2
1990	Other non-current assets (Note 6(14) and 7)	200,593	1	194,009	1	200,444	1
		18,863,987	92	19,790,196	92	22,061,288	93
Total assets		$20,447,643	100	21,258,556	100	23,707,885	100

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GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries
Consolidated Balance Sheet
March 31, 2026, December 31, 2025, and March 31, 2025
(Expressed in Thousands of New Taiwan Dollars)

	March 31, 2026		December 31, 2025		March 31, 2025
Liabilities and equity	Amount	%	Amount	%	Amount	%
Current liabilities:
2100 Short-term loans (Note 6(8))	$ 3,429,003	17	3,061,449	14	2,499,861	11
2171 Accounts payable (Note 6(10))	811,412	4	888,289	4	932,604	4
2219 Other payables (Note 6(4), (10), 7 and 9)	1,137,803	6	1,146,360	5	1,220,261	5
2230 Current tax liabilities	51,159	-	37,119	-	43,910	-
2280 Current lease liabilities (Note 6(11) and 7)	1,015,398	5	1,024,169	5	909,256	4
2322 Current portion of long-term borrowings (Note 6(9))	38,394	-	37,716	-	802,417	3
2399 Other current liabilities	12,193	-	11,793	-	12,199	-
	6,495,362	32	6,206,895	28	6,420,508	27
Non-current Liabilities:
2541 Long-term bank loans (Note 6(9))	-	-	-	-	39,846	-
2570 Deferred tax liabilities (Note 6(13))	1,751,810	9	1,984,582	9	2,242,837	9
2580 Non-current lease liabilities (Note 6(11) and 7)	7,857,489	38	8,700,673	41	9,753,728	42
2645 Deposit received	561,077	3	547,178	3	582,387	2
	10,170,376	50	11,232,433	53	12,618,798	53
Total liabilities:	16,665,738	82	17,439,328	81	19,039,306	80
Equity of owner of parent company (Note 6(14)):
3100 Share capital	1,955,310	10	1,955,310	9	1,955,310	8
3200 Capital surplus	3,656,472	18	3,656,472	18	4,168,363	18
3350 Unappropriated retained earnings (accumulated deficit)	(1,087,560)	(6)	(890,325)	(4)	(696,152)	(3)
3400 Other equity	(742,317)	(4)	(902,229)	(4)	(758,942)	(3)
Total equity	3,781,905	18	3,819,228	19	4,668,579	20
Total liabilities and equity	$20,447,643	100	21,258,556	100	23,707,885	100

See accompanying notes to consolidated financial statements.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries
Consolidated Balance Sheet
March 31, 2026, December 31, 2025, and March 31, 2025
(Expressed in Thousands of Chinese Yuan Renminbi)

Assets	March 31, 2026		December 31, 2025		March 31, 2025
		Amount	%	Amount	%	Amount	%
Current assets:
1100	Cash and cash equivalents	$ 64,310	1	54,541	1	102,656	2
1110	Financial assets measured at fair value through profit or loss – current	2,595	-	2,772	-	2,632	-
1170	Accounts receivable, net	29,267	1	27,920	1	27,584	1
1200	Other receivables	4,766	-	4,336	-	10,276	-
1300	Inventories – merchandising business	22,616	1	23,934	1	35,771	1
1410	Pre-payments	45,547	1	47,934	1	56,966	1
1476	Other financial assets – current	173,388	4	166,938	4	120,072	2
		342,489	8	328,375	8	355,957	7
Non-current assets:
1600	Property, plants and equipment	1,058,922	24	1,076,468	22	1,129,595	22
1755	Right-of-use asset	2,070,433	47	2,335,269	49	2,514,733	49
1780	Intangible assets	336,772	8	336,647	7	366,759	7
1840	Deferred tax assets	507,480	11	572,514	12	607,914	12
1980	Other financial assets – non-current	62,632	1	61,464	1	106,839	2
1990	Other non-current assets	43,381	1	43,387	1	43,331	1
		4,079,620	92	4,425,749	92	4,769,171	93
Total assets		$ 4,422,109	100	4,754,124	100	5,125,128	100

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GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Balance Sheet

March 31, 2026, December 31, 2025, and March 31, 2025

(Expressed in Thousands of Chinese Yuan Renminbi)

Liabilities and equity	March 31, 2026		December 31, 2025		March 31, 2025
		Amount	%	Amount	%	Amount	%
Current liabilities:
2100	Short-term loans	$ 741,574	17	684,642	14	540,416	11
2171	Accounts payable	175,480	4	198,651	4	201,609	4
2219	Other payables	246,067	6	256,364	5	263,794	5
2230	Current tax liabilities	11,064	-	8,301	-	9,492	-
2280	Current lease liabilities	219,595	5	229,039	5	196,561	4
2322	Current portion of long-term borrowings	8,303	-	8,435	-	173,465	3
2399	Other current liabilities	2,637	-	2,638	-	2,637	-
		1,404,720	32	1,388,070	28	1,387,974	27
Non-current liabilities:
2541	Long-term bank loans	-	-	-	-	8,614	-
2570	Deferred tax liabilities	378,855	9	443,819	9	484,853	10
2580	Non-current lease liabilities	1,699,300	38	1,945,762	41	2,108,544	41
2645	Deposit received	121,341	3	122,367	3	125,900	2
		2,199,496	50	2,511,948	53	2,727,911	53
Total liabilities:		3,604,216	82	3,900,018	81	4,115,885	80
Equity of owner of parent company:
3100	Share capital	492,105	10	492,105	9	492,105	10
3200	Capital surplus	613,189	15	613,189	14	728,494	14
3350	Unappropriated retained earnings (accumulated deficit)	(249,177)	(6)	(205,832)	(3)	(156,203)	(3)
3400	Other equity	(38,224)	(1)	(45,356)	(1)	(55,153)	(1)
Total equity		817,893	18	854,106	19	1,009,243	20
Total liabilities and equity		$ 4,422,109	100	4,754,124	100	5,125,128	100

See accompanying notes to consolidated financial statements.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Income Statement

For the three months ended March 31, 2026 and 2025

(Expressed in Thousands of New Taiwan Dollars, Except for Earnings Per Share)

		For the three months ended March 31
		2026		2025
		Amount	%	Amount	%
4000	Operating revenues (Note 6(16)	$ 725,245	100	796,329	100
5000	Operating costs	111,397	15	127,667	16
	Gross profit	613,848	85	668,662	84
6000	Operating expenses (Note 6(6), (11), (12) and 7)	619,006	85	698,992	88
6450	Expected credit loss (Note 6(3))	816	-	12,758	2
		619,822	85	711,750	90
	Operating loss	(5,974)	-	(43,088)	(6)
	Non-operating income and expenses:
7100	Total interest income (Note 6(18))	3,382	-	7,357	1
7010	Other revenues (Note 6(18))	127	-	74	-
7020	Other gains and losses (Note 6(18))	(47,510)	(6)	13,962	2
7050	Financial costs (Note 6(11), (18) and 7)	(135,480)	(19)	(151,825)	(19)
		(179,481)	(25)	(130,432)	(16)
7900	Loss before tax	(185,455)	(25)	(173,520)	(22)
7950	Deduction: income tax expenses (Note 6(13))	11,780	2	10,741	1
	Current net loss	(197,235)	(27)	(184,261)	(23)
8300	Other comprehensive income:
8360	Items that may be re-classified subsequently to profit or loss (Note 6(14))
8361	Exchange difference on translation of foreign operations	159,912	22	66,533	8
8399	Income tax related to components of other comprehensive income that will be reclassified to profit or loss	-	-	-	-
	Sum of items that may be re-classified subsequently to profit or loss	159,912	22	66,533	8
8300	Other comprehensive income (loss)	159,912	22	66,533	8
	Comprehensive income	$ (37,323)	(5)	(117,728)	(15)
	Net loss, attributable to:
8610	Owners of parent	$ (197,235)	(27)	(184,261)	(23)
	Comprehensive income (loss) attributable to:
8710	Owners of parent	$ (37,323)	(5)	(117,728)	(15)
	Loss per share (Note 6(15))
9750	Basic loss per share (NT dollars)	$	(1.01)		(0.94)

See accompanying notes to consolidated financial statements.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Income Statement

For the three months ended March 31, 2026 and 2025

(Expressed in Thousands of Chinese Yuan Renminbi, Except for Earnings Per Share)

	For the three months ended March 31
		2026		2025
		Amount	%	Amount	%
4000	Operating revenues	$ 159,383	100	176,753	100
5000	Operating costs	24,481	15	28,337	16
	Gross profit	134,902	85	148,416	84
6000	Operating expenses	136,035	85	155,148	88
6450	Expected credit loss	179	-	2,832	2
		136,214	85	157,980	90
	Operating loss	(1,312)	-	(9,564)	(6)
	Non-operating income and expenses:
7100	Total interest income	743	-	1,633	1
7010	Other revenues	28	-	17	-
7020	Other gains and losses	(10,441)	(6)	3,099	2
7050	Financial costs	(29,774)	(19)	(33,699)	(19)
		(39,444)	(25)	(28,950)	(16)
7900	Loss before tax	(40,756)	(25)	(38,514)	(22)
7950	Deduction: income tax expenses	2,589	2	2,384	1
	Current net loss	(43,345)	(27)	(40,898)	(23)
8300	Other comprehensive income:
8360	Items that may be re-classified subsequently to profit or loss
8361	Exchange difference on translation of foreign operations	7,132	4	704	-
8399	Income tax related to components of other comprehensive income that will be reclassified to profit or loss	-	-	-	-
	Sum of items that may be re-classified subsequently to profit or loss	7,132	4	704	-
8300	Other comprehensive income (loss)	7,132	4	704	-
	Comprehensive income	$ (36,213)	(23)	(40,194)	(23)
	Net loss, attributable to:
8610	Owners of parent	$ (43,345)	(27)	(40,898)	(23)
	Comprehensive income (loss) attributable to:
8710	Owners of parent	$ (36,213)	(23)	(40,194)	(23)
	Loss per share
9750	Basic loss per share (RMB)	$	(0.22)		(0.20)

See accompanying notes to consolidated financial statements.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Statement of Changes in Shareholders' Equity

For the three months ended March 31, 2026 and 2025

(Expressed in Thousands of New Taiwan Dollars)

	Owner's equity
			Retained earnings		Other equity
	Share capital	Capital surplus	Unappropriated retained earnings (accumulated deficit)	Sum	Exchange differences on translation of foreign operations	Total equity
Balance at January 1, 2025	$ 1,955,310	4,168,363	(511,891)	(511,891)	(825,475)	4,786,307
Current net loss	-	-	(184,261)	(184,261)	-	(184,261)
Current other comprehensive income	-	-	-	-	66,533	66,533
Current total comprehensive income	-	-	(184,261)	(184,261)	66,533	(117,728)
Balance at March 31, 2025	$ 1,955,310	4,168,363	(696,152)	(696,152)	(758,942)	4,668,579
Balance at January 1, 2026	$ 1,955,310	3,656,472	(890,325)	(890,325)	(902,229)	3,819,228
Current net loss	-	-	(197,235)	(197,235)	-	(197,235)
Current other comprehensive income	-	-	-	-	159,912	159,912
Current total comprehensive income	-	-	(197,235)	(197,235)	159,912	(37,323)
Balance at March 31, 2026	$ 1,955,310	3,656,472	(1,087,560)	(1,087,560)	(742,317)	3,781,905

See accompanying notes to consolidated financial statements.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Statement of Changes in Shareholders' Equity

For the three months ended March 31, 2026 and 2025

(Expressed in Thousands of Chinese Yuan Renminbi)

	Owner's equity
		Retained earnings			Other equity	Total equity
	Share capital	Capital surplus	Unappropriated retained earnings (accumulated deficit)	Sum	Exchange differences on translation of foreign operations
Balance at January 1, 2025	$ 492,105	728,494	(115,305)	(115,305)	(55,857)	1,049,437
Current net loss	-	-	(40,898)	(40,898)	-	(40,898)
Current other comprehensive income	-	-	-	-	704	704
Current total comprehensive income	-	-	(40,898)	(40,898)	704	(40,194)
Balance at March 31, 2025	$ 492,105	728,494	(156,203)	(156,203)	(55,153)	1,009,243
Balance at January 1, 2026	$ 492,105	613,189	(205,832)	(205,832)	(45,356)	854,106
Current net loss	-	-	(43,345)	(43,345)	-	(43,345)
Current other comprehensive income	-	-	-	-	7,132	7,132
Current total comprehensive income	-	-	(43,345)	(43,345)	7,132	(36,213)
Balance at March 31, 2026	$ 492,105	613,189	(249,177)	(249,177)	(38,224)	817,893

See accompanying notes to consolidated financial statements.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries
Consolidated Statement of Cash Flows
For the three months ended March 31, 2026 and 2025
(Expressed in Thousands of New Taiwan Dollars)

| | For the three months ended
March 31 | |
| --- | --- | --- |
| | 2026 | 2025 |
| Cash flows from operating activities | | |
| (Loss) profit before tax | $ (185,455) | (173,520) |
| Adjusting events: | | |
| Income and expenses | | |
| Depreciation expense | 332,805 | 369,740 |
| Amortization expense | 607 | 576 |
| Expected credit loss | 816 | 12,758 |
| Net loss on financial assets or liabilities at fair value through
profit or loss | 608 | 646 |
| Interest expense | 135,480 | 151,825 |
| Interest income | (3,382) | (7,357) |
| Loss on disposal of property, plant and equipment | 133 | 222 |
| Other loss | 47,451 | - |
| Total adjustments to reconcile profit (loss) | 514,518 | 528,410 |
| Changes in operating assets and liabilities: | | |
| Changes in operating assets: | | |
| Accounts receivable | (6,942) | 25,451 |
| Other receivables | (20,070) | (8,759) |
| Inventories | 5,998 | 1,352 |
| Prepayments | (9,495) | (3,994) |
| Subtotal of changes in operating assets | (30,509) | 14,050 |
| Changes in operating liabilities: | | |
| Accounts payable | (105,436) | (137,525) |
| Other payables | (57,721) | (175,772) |
| Other current liabilities | - | 1,438 |
| Subtotal of changes in operating liabilities | (163,157) | (311,859) |
| Subtotal of changes in operating assets and liabilities | (193,666) | (297,809) |
| Total adjustments | 320,852 | 230,601 |
| Cash inflow generated from operations | 135,397 | 57,081 |
| Interest received | 19,942 | 3,377 |
| Interest paid | (127,331) | (145,434) |
| Income taxes paid | (9,931) | (27,393) |
| Net cash flows from operating activities | 18,077 | (112,369) |

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GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Statement of Cash Flows

For the three months ended March 31, 2026 and 2025

(Expressed in Thousands of New Taiwan Dollars)

| | For the three months ended
March 31 | |
| --- | --- | --- |
| | 2026 | 2025 |
| Cash flows from (used in) investing activities: | | |
| Proceeds from disposal of investments using the equity method | 1,638 | 2,163 |
| Acquisition of property, plant and equipment | (20,855) | (12,757) |
| Decrease (Increase) in refundable deposits | 167 | (61) |
| Acquisition of intangible assets | (1,178) | (86) |
| (Increase) Decrease in other financial assets | (34,833) | 24,076 |
| Net cash flows used in investing activities | (55,061) | 13,335 |
| Cash flows from (used in) financing activities: | | |
| Increase (Decrease) in short-term loans | 271,998 | (73,733) |
| Decrease in deposit received | (4,669) | (16,369) |
| Payment of lease liabilities | (193,796) | (170,980) |
| Net cash flows used in financing activities | 73,533 | (261,082) |
| Effect of exchange rate changes on cash and cash equivalents | 16,936 | 3,622 |
| Net increase (decrease) in cash and cash equivalents | 53,485 | (356,494) |
| Cash and cash equivalents at beginning of period | 243,883 | 831,362 |
| Cash and cash equivalents at end of period | $ 297,368 | 474,868 |

See accompanying notes to consolidated financial statements.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries
Consolidated Statement of Cash Flows
For the three months ended March 31, 2026 and 2025
(Expressed in Thousands of Chinese Yuan Renminbi)

| | For the three months ended
March 31 | |
| --- | --- | --- |
| | 2026 | 2025 |
| Cash flows from operating activities | | |
| (Loss) profit before tax | $ (40,756) | (38,514) |
| Adjusting events: | | |
| Income and expenses | | |
| Depreciation expense | 73,139 | 82,067 |
| Amortization expense | 133 | 128 |
| Expected credit loss | 179 | 2,832 |
| Net loss on financial assets or liabilities at fair value through
profit or loss | 134 | 143 |
| Interest expense | 29,774 | 33,699 |
| Interest income | (743) | (1,633) |
| Loss on disposal of property, plant and equipment | 29 | 49 |
| Other loss | 10,428 | - |
| Total adjustments to reconcile profit (loss) | 113,073 | 117,285 |
| Changes in operating assets and liabilities: | | |
| Changes in operating assets: | | |
| Accounts receivable | (1,526) | 5,649 |
| Other receivables | (4,411) | (1,944) |
| Inventories | 1,318 | 300 |
| Prepayments | (2,087) | (887) |
| Subtotal of changes in operating assets | (6,706) | 3,118 |
| Changes in operating liabilities: | | |
| Accounts payable | (23,171) | (30,525) |
| Other payables | (12,685) | (39,014) |
| Other current liabilities | - | 319 |
| Subtotal of changes in operating liabilities | (35,856) | (69,220) |
| Subtotal of changes in operating assets and liabilities | (42,562) | (66,102) |
| Total adjustments | 70,511 | 51,183 |
| Cash inflow generated from operations | 29,755 | 12,669 |
| Interest received | 4,383 | 750 |
| Interest paid | (27,983) | (32,280) |
| Income taxes paid | (2,182) | (6,080) |
| Net cash flows from operating activities | 3,973 | (24,941) |

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GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Statement of Cash Flows

For the three months ended March 31, 2026 and 2025

(Expressed in Thousands of Chinese Yuan Renminbi)

| | For the three months ended
March 31 | |
| --- | --- | --- |
| | 2026 | 2025 |
| Cash flows from (used in) investing activities: | | |
| Proceeds from disposal of investments using the equity method | 360 | 480 |
| Acquisition of property, plant and equipment | (4,583) | (2,832) |
| Decrease (Increase) in refundable deposits | 37 | (14) |
| Acquisition of intangible assets | (259) | (19) |
| (Increase) Decrease in other financial assets | (7,655) | 5,344 |
| Net cash flows used in investing activities | (12,100) | 2,959 |
| Cash flows from (used in) financing activities: | | |
| Increase in short-term loans | 59,776 | (16,366) |
| Decrease in deposit received | (1,026) | (3,633) |
| Payment of lease liabilities | (42,589) | (37,951) |
| Net cash flows used in financing activities | 16,161 | (57,950) |
| Effect of exchange rate changes on cash and cash equivalents | 1,735 | 305 |
| Net increase (decrease) in cash and cash equivalents | 9,769 | (79,627) |
| Cash and cash equivalents at beginning of period | 54,541 | 182,283 |
| Cash and cash equivalents at end of period | $ 64,310 | 102,656 |

See accompanying notes to consolidated financial statements.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries
Notes to the Consolidated Financial Statements
For the three months ended March 31, 2026 and 2025
(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

Company History

GRAND OCEAN RETAIL GROUP LTD. (the “Company”) was founded in the Cayman Islands on Aug 23, 2006, and the organizational structure re-engineering of the company was executed in Oct 2007. Afterwards there were 160,000 thousand newly-issued shares from the company in exchange for 100% equity of REGAL OCEAN INTERNATIONAL LTD., making the company also acquire 100% equity of the Grand Ocean Department Store indirectly. After re-engineering, the company has become the parent company of the Grand Ocean Department Store Group. Shares of the company had been listed in Taiwan Stock Exchange since June 6, 2012. The consolidated financial statements of the company include equity of the associates by the company and its subsidiaries (the “Group”). Main business contents of the Group are business management consulting and retail sales.

Approval date and procedures of the consolidated financial statements:

These consolidated financial statements were approved and authorized for issuance by the Board of Directors on May 14, 2026.

New standards, amendments and interpretations adopted:

(1) The impact of the International Financial Reporting Standards (“IFRSs”) endorsed by the Financial Supervisory Commission, R.O.C. (“FSC”) which have already been adopted.

The Group has initially adopted the following new amendments, which do not have a significant impact on its consolidated financial statements, from January 1, 2026.

IFRS 17 “Insurance Contracts” and Amendments to IFRS 17.
Amendment to IFRS 9 and IFRS 7 "Amendments to the Classification and Measurement of Financial Instruments"
Annual Improvements to IFRS Accounting Standards.
Amendments to IFRS 9 and IFRS 7 “Contracts Referencing Nature-dependent Electricity”.

(2) The impact of IFRS issued by IASB but not yet endorsed by the FSC

The following new and amended standards, which may be relevant to the Group, have been issued by the International Accounting Standards Board (IASB), but have yet to be endorsed by the FSC:

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Standards or Interpretations	Content of amendment	Effective date per IASB
IFRS 18 “Presentation and Disclosure in Financial Statements”	The new standard introduces three categories of income and expenses, two income statement subtotals and one single note on management performance measures. The three amendments, combined with enhanced guidance on how to disaggregate information, set the stage for better and more consistent information for users, and will affect all the entities.

● A more structured income statement: under current standards, companies use different formats to present their results, making it difficult for investors to compare financial performance across companies. The new standard promotes a more structured income statement, introducing a newly defined ‘operating profit’ subtotal and a requirement for all income and expenses to be allocated between three new distinct categories based on a company’s main business activities.

● Management performance measures (MPMs): the new standard introduces a definition for management performance measures and requires companies to explain in a single note to the financial statements why the measure provides useful information, how it is calculated and reconcile it to an amount determined under IFRS Accounting Standards.

● Greater disaggregation of information: the new standard includes enhanced guidance on how companies group information in the financial statements. This includes guidance on whether information is included in the primary financial statements or is further disaggregated in the notes. | January 1, 2027
Note: On September 25, 2025, the FSC issued a press release announcing that Taiwan will adopt IFRS 18 beginning in 2028. |

The Group is evaluating the impact on its consolidated financial position and consolidated financial performance upon the initial adoption of the above-mentioned standards or interpretations. The results thereof will be disclosed when the Group completes its evaluation.

The Group does not expect the following other new and amended standards, which have yet to be endorsed by the FSC, to have a significant impact on its consolidated financial statements:

Amendments to IFRS 10 and IAS 28 "Sale or Contribution of Assets between an Investor and its Associate or Joint Venture".
IFRS 19 "Subsidiaries without Public Accountability: Disclosures" and amendments to IFRS 19.
Amendments to IAS 21 "Translation to a Hyperinflationary Presentation Currency".

4. Summary of significant accounting policies:

(1) Statement of compliance

This consolidated financial report has been prepared in accordance with the Securities Issuance Company Financial Reporting Standards (referred to as the "Reporting Standards") and International Accounting Standard No. 34 "Interim Financial Reporting" as approved and issued by the Financial Supervisory Commission (FSC). This consolidated financial report does not include the complete necessary information required to be disclosed in the annual consolidated financial report prepared in accordance with the International Financial Reporting Standards, Accounting Standards, Interpretations, and Interpretive Bulletins (referred to as "FSC-approved IFRS Accounting Standards") approved and issued by the FSC.

Apart from the following, the significant accounting policies adopted in this consolidated financial report are consistent with the consolidated financial report for the year ended December 31, 2025. For related information, please refer to Note 4 of the consolidated financial report for the year ended December 31, 2025.

(2) Basis of consolidation

A. Subsidiary Listed in Consolidated Financial Statements

All the shareholding ratios of other subsidiaries listed in the consolidated financial statements are 100%, which are listed as follows:

Name of Investor	Name of Subsidiary	Principal activity	Percentage of holding shares (%)			Note
			March 31, 2026	December 31, 2025	March 31, 2025
GRAND OCEAN RETAIL GROUP LTD.	GRAND CITI LTD.	Investment holding company	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
GRAND CITI LTD.	Grand Ocean Classic Commercial Group Co., Ltd	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
GRAND CITI LTD.	Grand Ocean Classic (Shanghai) Commercial Group Co., Ltd. (Note)	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	- %	The company directly (indirectly) holds more than 50% of its subsidiaries

Name of Investor	Name of Subsidiary	Principal activity	Percentage of holding shares (%)			Note
			March 31, 2026	December 31, 2025	March 31, 2025
Grand Ocean Classic Commercial Group Co., Ltd	Nanjing Grand Ocean Classic Commercial Limited	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Grand Ocean Classic Commercial Group Co., Ltd	Fuzhou Grand Ocean Commercial Limited	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Grand Ocean Classic Commercial Group Co., Ltd	Quanzhou Grand Ocean Commercial Limited	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Grand Ocean Classic Commercial Group Co., Ltd	Shanghai Jingxuan Business Administration Limited (Note)	Management consulting business, and trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Grand Ocean Classic Commercial Group Co., Ltd	Shanghai Grand Ocean Qianxhu Commercial Management Co., Ltd	Management consulting business, and trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Quanzhou Grand Ocean Commerce Limited	Wuhan Grand Ocean Classic Commercial Development Limited	Trading of cosmetics, furnishings, etc.	30.00%	30.00%	30.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Nanjing Grand Ocean Classic Commerce Limited	Hefei Grand Ocean Classic Commercial Development Limited	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Fuzhou Grand Ocean Commerce Limited	Fuzhou Grand Ocean Classic Commercial Development Limited	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Fuzhou Grand Ocean Commerce Limited	Wuhan Grand Ocean Classic Commercial Development Limited	Trading of cosmetics, furnishings, etc.	70.00%	70.00%	70.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Fuzhou Grand Ocean Commerce Limited	Fuzhou Jiaruixing Business Administration Limited (Note)	Management consulting business, and trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Wuhan Grand Ocean Classic Commercial Development Limited	Wuhan Optics Valley Grand Ocean Commercial Development Limited	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries

Name of Investor	Name of Subsidiary	Principal activity	Percentage of holding shares (%)			Note
			March 31, 2026	December 31, 2025	March 31, 2025
Wuhan Grand Ocean Classic Commercial Development Limited	Chongqing Optics Valley Grand Ocean Commercial Development Limited	Trading of cosmetics, furnishings, etc.	- %	35.30%	35.30%	The company directly (indirectly) holds more than 50% of its subsidiaries and the liquidation procedures were completed in January 2026.
Wuhan Grand Ocean Classic Commercial Development Limited	Wuhan Hanyang Grand Ocean Classic Commercial Limited	Trading of cosmetics, furnishings, etc.	50.00%	50.00%	50.00%	The company directly (indirectly) holds more than 50% of its subsidiaries and it also ceased operations on August 31, 2023, and in the process of liquidation.
Wuhan Grand Ocean Classic Commercial Development Limited	Hengyang Grand Ocean Commercial Development Limited	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Wuhan Grand Ocean Classic Commercial Development Limited	Shiyan Grand Ocean Commerce Limited	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Wuhan Grand Ocean Classic Commercial Development Limited	Chongqing Optics Valley Grand Ocean Commercial Development Limited	Trading of cosmetics, furnishings, etc.	- %	64.70%	64.70%	The company directly (indirectly) holds more than 50% of its subsidiaries and the liquidation procedures were completed in January 2026.
Wuhan Optics Valley Grand Ocean Commercial Development Limited	Wuhan Hanyang Grand Ocean Classic Commercial Limited	Trading of cosmetics, furnishings, etc.	50.00%	50.00%	50.00%	The company directly (indirectly) holds more than 50% of its subsidiaries and it also ceased operations on August 31, 2023, and in the process of liquidation.
Wuhan Optics Valley Grand Ocean Commercial Development Limited	Yichang Grand Ocean Commerce Limited	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	100.00%	The company directly (indirectly) holds more than 50% of its subsidiaries
Fuzhou Grand Ocean Commerce Limited	Fuzhou Grand Ocean Select Commercial Co., Ltd.	Trading of cosmetics, furnishings, etc.	100.00%	100.00%	- %	The company directly (indirectly) holds more than 50% of its subsidiaries

Note: As the subsidiaries do not meet the definition of significant subsidiaries, their financial statements as at March 31, 2026 were not reviewed by independent auditors.

B. Subsidiaries excluded from the consolidated financial statements: None.

(3) Income taxes

The Group measures and discloses income tax expense for the interim period in accordance with Paragraph B12 of International Accounting Standard No. 34 "Interim Financial Reporting."

Income tax expense is measured by multiplying the pre-tax income for the interim reporting period by the management's best estimate of the effective tax rate for the full year. The current income tax expense and deferred income tax expense are then allocated based on the ratio of the estimated current and deferred income tax expenses for the full year.

Income tax expense that is directly recognized in equity items or in comprehensive income is measured based on the temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their tax bases, using the applicable tax rate expected to be realized or settled upon realization or settlement.

Significant accounting assumptions and judgments, and major sources of estimation uncertainty:

In the preparation of this consolidated financial report, management has made judgments and estimates about the future, including climate-related risks and opportunities, in accordance with the applicable accounting standards and International Accounting Standard No. 34 "Interim Financial Reporting" recognized by the Financial Supervisory Commission. These judgments, estimates, and assumptions may have an impact on the adoption of accounting policies and the reported amounts of assets, liabilities, income, and expenses. Actual results may differ from these estimates.

In the preparation of the consolidated financial report, management's significant judgments and key sources of estimation uncertainty in adopting the accounting policies of the Group are consistent with Note 5 of the consolidated financial report for the year ended December 31, 2025.

Explanation of significant accounts:

Apart from the following, the explanations of significant accounting items in this consolidated financial report are not materially different from the consolidated financial report for the year ended December 31, 2025. Please refer to Note 6 of the consolidated financial report for the year ended December 31, 2025, for relevant information.

(1) Cash and cash equivalents

	March 31, 2026	December 31, 2025	March 31, 2025
Cash on hand and petty cash	$ 5,608	5,293	7,059
Demand deposits	291,760	238,590	441,909
Time deposits	-	-	25,900
Total	$ 297,368	243,883	474,868

Please refer to Note 6(19) for the sensitivity analysis and interest rate risk.

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

	March 31, 2026	December 31, 2025	March 31, 2025
Mandatorily measured at fair value through profit or loss - current:
Open-end funds	$ 11,999	12,394	12,177

A. Please refer to Note 6(19) for disclosure of credit risk and market risk of all financial instruments mentioned above.
B. The financial assets mentioned above had not been pledged as collateral.
C. For gain or loss on financial assets or liabilities at fair value through profit or loss, please refer to Note 6(18).

(3) Account receivables and other receivables

	March 31, 2026	December 31, 2025	March 31, 2025
Accounts receivable	$ 184,674	200,473	190,021
Allowance for impairment	(49,348)	(75,626)	(62,422)
	135,326	124,847	127,599
Other receivables - current :
Other receivables - investment funds	282,061	272,768	282,175
Other receivables – lease deposit	65,898	63,727	65,924
Other receivables – others	31,709	28,739	47,537
Less: Impairment loss allowance	(357,630)	(345,847)	(348,099)
Subtotal	22,038	19,387	47,537
Total	$ 157,364	144,234	175,136

A. The Group's main trade receivables from retail department in China are credit card payments collected from banks, with an average credit period of 2 to 3 days, wherein there is no concern about the collectability, so the simplified method is used to estimate the expected credit loss for the leased accounts receivable, the expected credit loss during the lifetime is used to measure. To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due, as well as incorporated forward-looking information.

The expected credit loss analysis of the remaining accounts receivable of the Group is as follows :

March 31, 2026

	Gross carrying amount	Weighted-average loss rate	Loss allowance provision
Not overdue	$ 95,960	0%	-
1 to 90 days past due	42,676	0%~13%	3,310
91 to 180 days past due	6,301	100%	6,301
181 to 270 days past due	3,016	100%	3,016
271 to 365 days past due	3,453	100%	3,453
More than 365 days past due	33,268	100%	33,268
	$ 184,674		49,348

December 31, 2025

	Gross carrying amount	Weighted-average loss rate	Loss allowance provision
Not overdue	$ 91,575	0%	-
1 to 90 days past due	54,700	0%~39%	21,428
91 to 180 days past due	7,591	100%	7,591
181 to 270 days past due	2,141	100%	2,141
271 to 365 days past due	3,218	100%	3,218
More than 365 days past due	41,248	100%	41,248
	$ 200,473		75,626

March 31, 2025

	Gross carrying amount	Weighted-average loss rate	Loss allowance provision
Not overdue	$ 99,137	0%	-
1 to 90 days past due	20,717	0%	-
91 to 180 days past due	8,143	0%~27%	2,231
181 to 270 days past due	7,824	77%	5,991
271 to 365 days past due	19,613	100%	19,613
More than 365 days past due	34,587	100%	34,587
	$ 190,021		62,422

B. Changes in the provision for losses on accounts receivable of the Group are as follows:

	For the three months ended March 31
	2026	2025
Opening balance	$ 75,626	48,757
Impairment loss recognized	816	12,758
Amount written off	(29,210)	(125)
Exchange rate impact number	2,116	1,032
Ending balance	$ 49,348	62,422

C. Other receivables—others are the advance payment in accordance with the promotions held by retail business department and vendors. Since the Group and the vendors are in a long-term business relationship, the Group has considered historical experience and believed that they were less doubtful of the recoverability of these receivables. The Group assessed the aforesaid other receivables as the financial assets with low credit risk and measured loss allowances at an amount as 12-month expected credit loss. Please refer to Note 6(19) for the remaining credit risk information.

D. Since the rental agreement of Xiangtan Grand Ocean Department Store Co., Ltd. (Xiangtan) one of the Group’s subsidiaries, have reached its maturity in December 2018, the Group ceased Xiangtan’s business operation, wherein a security deposit amounting to CNY 15,000 thousand is expected to be received. Xiangtan had already returned the property to its owner, Xiangyuan Industrial Development Co., Ltd. (Xiangyuan), but failed to receive the security deposit. In order to receive the payment and begin the liquidation process, Xiangtan filed a lawsuit against Xiangyuan. On July 1, 2019, the people’s court ordered Xiangyuan to pay the amount of CNY 14,700 thousand to Xiangtan. However, Xiangyuan disagreed with the court’s decision, therefore, filed an appeal on November 13, 2019, wherein it was denied on January 16, 2020. Furthermore, Xiangtan filed an appeal to the court to freeze the property of Xiangyuan, in which the court granted the approval to do so. After a thorough investigation by the court, it was found that Xiangyuan has enough property to pay for the security deposit, and the Group has collected the mandatory payment of NT$1,952 thousand (CNY 448 thousand). However, considering that the department store industry has been more severely affected by the pandemic and economic uncertainties, and that the future development of the region remains highly uncertain, the Group, based on the principle of prudence, has recognized expected credit losses on the rental deposit. As of March 31, 2026, December 31, 2025, and March 31, 2025, the rental deposit and the corresponding allowance for expected credit losses were NT$65,898 thousand (CNY 14,252 thousand), NT$63,727 thousand (CNY 14,252 thousand), and NT$65,924 thousand (CNY 14,252 thousand), respectively.

E. In 2012, the Group paid a guarantee deposit of CNY 124,000 thousand to Quanzhou Fengsheng Group to purchase the commercial real estate of the Fengsheng Junyuan Development Project developed by Fengsheng Group in Fengze District, Quanzhou. After assessing the investment value of the project, the Board of Directors of the Group resolved during the meeting in July 2015 to invest Quanzhou Fengan Real Estate Development Co., Ltd. (Fengan), and expected to obtain 100% equity of the company with a contractual amount of CNY 325,000 thousand. As of December 31, 2015, the Group had paid CNY 200,000 thousand, which was reported under the prepayment for investments. The management of the Group evaluated the uncertainty of the investment and thus terminated the investment. Therefore, the original prepayment for investments of CNY 200,000 thousand and other financial assets – current of CNY 124,000 thousand, were reclassified as other receivables as of June 30, 2016.

In addition, the Group reviewed the nature of other receivables and analyzed the current

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financial position of the counterparty. In order to secure the aforementioned debt, the Group had acquired pledge of stock rights of Fengan, and at the same time had obtained the debtor's promise that other investment profits to be priority to repay the debt. The Group evaluated that the aforementioned debt should have no impairment concern. Because the debtor takes time to complete the relevant legal procedures of the disposition of investment, the Group and the debtor renegotiate the repayment period, which should be before April 30, 2017, before September 30, 2017, and before December 31, 2017. The total amount of repayment should be 10%, 40% and 50%, respectively. In case of violation of the agreement, the aforementioned collateral would be transferred to the Group for debt repayment. As of December 31, 2017, the Group had recovered CNY 162,000 thousand according to aforesaid agreement. On December 19, 2017, the Board of Directors of the Group resolved during the meeting on the Fengsheng Group's extension of the repayment agreement, which extended remaining proceeds to June 30, 2018. Due to the delay of procedures of the disposition of investment, Fengsheng Group could not make the payments by the aforementioned date.

To ensure the recovery of the aforementioned creditor's rights and the development of Fengan's property, on August 12, 2019, the Board of Directors resolved to sign a "Debt Confirmation and Repayment Plan" with Damahua Investment Co., Ltd. (Damahua), Fengsheng and Fengan, stating that Damahua will provide financial support to Fengan for the development and construction of a real estate property to be sold to the market to ensure that the future sales proceeds will be used to repay for the aforementioned claims. Considering the development progress of Fengan's property, the credit recovery period will exceed one year; therefore, the related receivables reclassified to other non-current receivables were recognized as other non-current financial assets. The Group evaluated that the aforementioned debt should have no impairment concern under the cash flow of pledge asset.

The Board of Directors resolved to sign a "Debt Preservation and Conditional Credit Transfer Agreement" and agree that the Group and Damahua to oversee the development and construction of Fengan's property to ensure that the future sales proceeds will be used to repay for the aforementioned claims. Damahua agreed that the credit transfer condition would be met under certain circumstances mentioned in transfer agreement, such as the construction couldn't resume as scheduled, the court auction is designated, or the compulsory execution is enforced by judicial authority. The aforementioned "Debt Preservation and Conditional Credit Transfer Agreement" stated that the development project of the Fengan property must be restarted before June 30, 2020. The progress of approval was delayed because of COVID-19 pandemic. The Group has agreed to extend the start date to December 31, 2020.

On December 31, 2020, the aforementioned "Debt Preservation and Conditional Credit Transfer Agreement" has been reached, Damahua carried the aforementioned creditor's right. On February 9, 2021, the Group agreed to modify the original payment terms and timeline because of the impact of COVID-19 pandemic and the property policy in

~21~

Quanzhou, which are force majeure. The details of payments are as follows:

(A) Damahua agrees to pay CNY 30,000 thousand before February 9, 2021.
(B) Damahua agrees to pay CNY 51,000 thousand before December 31, 2021.
(C) Damahua agrees to pay CNY 81,000 thousand before June 30, 2022.
(D) Under the premise of obtaining written consent of the Group, Damahua can transfer the title of properties located in Citong road to the Group, as the payment of debt.

Due to the force majeure factor of the COVID-19 epidemic, the society, various industries and the business of Damahua have been seriously affected. In August 2022, Damahua needs to retain part of the operating capital, and proposes to the Group to postpone the payment of the remaining receivables until June 30, 2023. The payment schedule is described as follows:

(A) Damahua agrees to pay CNY 16,000 thousand before December 31, 2022.
(B) Damahua agrees to pay CNY 16,000 thousand before March 31, 2023.
(C) Damahua agrees to pay CNY 29,000 thousand before June 30, 2023.
(D) If the above amount is not repaid by Damahua before the expiry of the deferred repayment period, Damahua will unconditionally cooperate with the liquidation of the Quanzhou Citong Road Project, and the land disposal price of the Quanzhou Citong Road Project will be repaid to the Group in priority.

The Group had an original receivable of CNY 162,000 thousand from Damahua. As of June 30, 2023, a total of CNY 101,000 thousand has been repaid, with the remaining CNY 61,000 thousand still outstanding and not repaid by Damahua in accordance with the agreement. The Group considers that the aforementioned creditor's rights are caused by undertaking the Fengan land, and the Quanzhou Municipal Government has recently agreed that existing developers will adopt a cooperative approach to undertake the development and construction of the Fengan land plot, which will be implemented by the Fengze District Government, and is coordinating to promote Fengan land is under construction, so the Group intends to negotiate with Damahua for proceeds from subsequent project development in order to repay all creditor's rights of the Group.

Although the Group assessed that after the allocation of the disposal value of the Fengan land, Damahua should be able to repay the debts. However, following the COVID-19 pandemic in China, the economy has not yet recovered to normal levels. In accordance with the principle of prudence, the Group recognized expected credit losses on the aforementioned receivables. As of March 31, 2026, December 31, 2025, and March 31, 2025, the outstanding receivables and the related allowance for expected credit losses were NT$282,061 thousand (CNY 61,000 thousand), NT$272,768 thousand (CNY 61,000 thousand), and NT$282,175 thousand (CNY 61,000 thousand), respectively.

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F. On June 28, 2023, the Group entered into an equity repurchase and urban investment termination agreement with Shanghai Dongfadao Catering Management Co., Ltd. in relation to Nanjing Grand Ocean Dongfadao Catering Co., Ltd., with a total repurchase consideration of NT$30,157 thousand (CNY 7,000 thousand). The equity transfer procedures were completed on August 30, 2023. Pursuant to the agreement, the repurchase consideration is to be received in installments. As of March 31, 2026, December 31, 2025, and March 31, 2025, the outstanding amounts yet to be collected were zero, NT$1,610 thousand (CNY 360 thousand), and NT$7,586 thousand (CNY 1,640 thousand), respectively. These amounts were recognized under other receivables.

G. The Group provided employees with treasury shares subscription rights funded through salary advances. However, the salary advances made to certain former employees have not yet been recovered. Accordingly, these amounts were reclassified from “Other non-current assets – others” to “Other receivables,” and full impairment losses were recognized. For related information, please refer to Note 6(14). As of March 31, 2026, December 31, 2025, and March 31, 2025, the unrecovered receivables and the corresponding impairment allowances amounted to NT$9,671 thousand (RMB 2,091 thousand), NT$9,352 thousand (RMB 2,091 thousand), and zero, respectively.

(4) Property, plant and equipment

The cost, depreciation, and impairment of the property, plant and equipment of the Group were as follows:

	Building	Transportation Device	Office Equipment	Lease Improvement	Construction in progress	Total
Cost or deemed cost:
Balance at January 1, 2026	$ 4,726,415	11,939	219,362	6,785,426	22,774	11,765,916
Additions	-	-	2,170	-	16,487	18,657
Current re-classification	-	-	343	21,004	(21,347)	-
Disposal and abandonment	-	-	(321)	(6,930)	-	(7,251)
Influenced by fluctuation of exchange rates	161,035	406	7,507	231,412	618	400,978
Balance at March 31, 2026	$ 4,887,450	12,345	229,061	7,030,912	18,532	12,178,300
Balance at January 1, 2025	$ 4,820,717	13,029	226,796	6,864,726	22,495	11,947,763
Additions	-	-	364	1,365	1,296	3,025
Current re-classification	-	-	-	14,365	(14,365)	-
Disposal and abandonment	-	-	(853)	(3,148)	-	(4,001)
Influenced by fluctuation of exchange rates	68,695	185	3,219	98,158	(62)	170,195
Balance at March 31, 2025	$ 4,889,412	13,214	229,526	6,975,466	9,364	12,116,982

	Building	Transportation Device	Office Equipment	Lease Improvement	Construction in progress	Total
Depreciation and impairment losses:
Balance at January 1, 2026	$ 1,635,929	6,587	173,814	5,133,729	2,317	6,952,376
Depreciation	25,373	318	2,749	69,927	-	98,367
Disposal and abandonment	-	-	(289)	(6,829)	-	(7,118)
Influenced by fluctuation of exchange rates	56,149	229	5,960	175,927	-	238,265
Balance at March 31, 2026	$ 1,717,451	7,134	182,234	5,372,754	2,317	7,281,890
Balance at January 1, 2025	$ 1,566,841	7,745	170,933	4,944,306	2,317	6,692,142
Depreciation	25,122	353	2,829	76,979	-	105,283
Disposal and abandonment	-	-	(749)	(3,030)	-	(3,779)
Influenced by fluctuation of exchange rates	22,999	120	2,491	72,431	-	98,041
Balance at March 31, 2025	$ 1,614,962	8,218	175,504	5,090,686	2,317	6,891,687
Carrying amounts:
Balance at January 1, 2026	$ 3,090,486	5,352	45,548	1,651,697	20,457	4,813,540
Balance at March 31, 2026	$ 3,169,999	5,211	46,827	1,658,158	16,215	4,896,410
Balance at January 1, 2025	$ 3,253,876	5,284	55,863	1,920,420	20,178	5,255,621
Balance at March 31, 2025	$ 3,274,450	4,996	54,022	1,884,780	7,047	5,225,295

A. As of March 31, 2026, December 31, 2025 and March 31, 2025, due to payments to stores maintenance and to acquire the property for department stores, the Group recognized other payables amounting to NT$84,424 thousand, NT$83,801 thousand and NT$82,132 thousand, respectively.

B. The significant components of the buildings include the main building, machinery and air conditioner with their own estimated useful lives as 5 to 50 years, 5 to 20 years and 5 to 20 years.

C. The recoverable amount and the key assumptions used in the Group's impairment assessment of non-financial assets are consistent with those disclosed in the consolidated financial statements for the year ended December 31, 2025, with no material changes. For related information, please refer to Note 6(4) of the consolidated financial statements for the year ended December 31, 2025.

D. Please refer to Note 6(18) for details on disposal gains and losses.

E. Guarantee

Please refer to Note 8 for the details of long-term loans and financing line guarantees on March 31, 2026, December 31, 2025, and March 31, 2025.

(5) Right of use assets

The movements in the cost and depreciation of the leased land, buildings, machine and transportation equipment were as follows:

	Land	Buildings	Machine equipment	Total
Cost:
Balance at January 1, 2026	$ 3,375,111	13,248,065	60,188	16,683,364
Lease modifications	-	(970,656)	-	(970,656)
Effect of changes in foreign exchange rates	114,995	435,673	2,051	552,719
Balance at March 31, 2026	$ 3,490,106	12,713,082	62,239	16,265,427
Balance at January 1, 2025	$ 3,442,452	13,546,704	61,389	17,050,545
Effect of changes in foreign exchange rates	49,055	193,039	875	242,969
Balance at March 31, 2025	$ 3,491,507	13,739,743	62,264	17,293,514
Accumulated depreciation:
Balance at January 1, 2026	$ 803,972	5,386,838	50,158	6,240,968
Depreciation	23,734	209,071	1,633	234,438
Effect of movement in exchange rate	27,777	186,919	1,736	216,432
Balance at March 31, 2026	$ 855,483	5,782,828	53,527	6,691,838
Balance at January 1, 2025	$ 724,858	4,544,115	44,612	5,313,585
Depreciation	23,499	239,341	1,617	264,457
Effect of movement in exchange rate	10,958	71,153	679	82,790
Balance at March 31, 2025	$ 759,315	4,854,609	46,908	5,660,832
Carrying amounts:
Balance at January 1, 2026	$ 2,571,139	7,861,227	10,030	10,442,396
Balance at March 31, 2026	$ 2,634,623	6,930,254	8,712	9,573,589
Balance at January 1, 2025	$ 2,717,594	9,002,589	16,777	11,736,960
Balance at March 31, 2025	$ 2,732,192	8,885,134	15,356	11,632,682

The Group's subsidiaries, Wuhan Grand Ocean Classic Commercial Development Limited and Wuhan Optics Valley Grand Ocean Commercial Development Limited, reached agreements with the lessors in 2026 for rent reductions on their leased operating premises. Accordingly, the right-of-use assets and lease liabilities were reduced by NT$970,656 thousand.

(6) Intangible assets

The costs, amortization, and impairment loss of intangible assets were as follows:

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	Goodwill	Trademark Rights	Computer Software	Total
Costs:
Balance at January 1, 2026	$ 1,494,827	440,526	37,550	1,972,903
Additions	-	-	1,178	1,178
Influenced by fluctuation of exchange rates	50,930	7,919	1,299	60,148
Balance at March 31, 2026	$ 1,545,757	448,445	40,027	2,034,229
Balance at January 1, 2025	$ 1,524,652	459,518	36,758	2,020,928
Additions	-	-	86	86
Influenced by fluctuation of exchange rates	21,726	5,887	527	28,140
Balance at March 31, 2025	$ 1,546,378	465,405	37,371	2,049,154
Amortization and impairment losses:
Balance at January 1, 2026	$ -	440,526	27,025	467,551
Amortization	-	-	607	607
Influenced by fluctuation of exchange rates	-	7,919	931	8,850
Balance at March 31, 2026	$ -	448,445	28,563	477,008
Balance at January 1, 2025	$ -	322,328	25,190	347,518
Amortization	-	-	576	576
Influenced by fluctuation of exchange rates	-	4,130	374	4,504
Balance at March 31, 2025	$ -	326,458	26,140	352,598
Carrying amounts:
Balance at January 1, 2026	$ 1,494,827	-	10,525	1,505,352
Balance at March 31, 2026	$ 1,545,757	-	11,464	1,557,221
Balance at January 1, 2025	$ 1,524,652	137,190	11,568	1,673,410
Balance at March 31, 2025	$ 1,546,378	138,947	11,231	1,696,556

A. Recognition of amortization

The amortization of intangible assets are included in the consolidated statements of comprehensive income for the three months ended March 31, 2026 and 2025:

	For the three months ended March 31
	2026	2025
Operating expenses	$ 607	576

B. Goodwill

The recoverable amount and the key assumptions used for the department store retail cash-generating unit are consistent with those disclosed in the consolidated financial statements for the year ended December 31, 2025, with no material changes. For related information, please refer to Note 6(6) of the consolidated financial statements for the year ended December 31, 2025.

(7) Other financial assets—current and non-current

The details of Other financial assets—current and non-current are as below:

	March 31, 2026	December 31, 2025	March 31, 2025
Other financial assets—current
Deposits—out for lease (Note)	$ 279	270	296
Restricted deposits	798,749	738,200	552,690
Others	2,712	8,012	2,466
	$ 801,740	746,482	555,452
Other financial assets—non-current
Deposits—out for lease (Note)	$ 210,230	201,119	204,770
Deposits—out for cooperation	6,689	6,609	7,273
Restricted deposits	-	-	209,454
Deposit for rent expansion (Note)	69,359	67,074	69,387
Others	3,331	42	3,332
	$ 289,609	274,844	494,216

Note: The lease deposit is mainly the deposit deposited by the lessee; the deposit for rent expansion is the deposit paid by the subsidiary, Yichang Grand Ocean Commerce Limited, for expanding the leased area, and it will be used to offset the rental expenses after the contract is signed.

(8) Short-term loans

The details of short-term loans are as below:

	March 31, 2026	December 31, 2025	March 31, 2025
Secured bank loans	$ 3,429,003	3,061,449	2,499,861
Unused credit lines	$ 271,582	661,630	334,249
Range of interest rates	3.0%~5.4%	3.0%~5.4%	3.25%~6.2%

A. For information on the Group’s assets pledged as collateral for bank borrowings, please refer to Note 8.
B. For information on the Group’s exposure to interest rate risk and liquidity risk, please refer to Note 6(19).

(9) Long-term loans

The list, terms and conditions of long-term loans of the Group were as follows:

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March 31, 2026

	Currency	Interest rate collar	Year of expiry	Amount
Unsecured bank loans	USD	5.86%	115	$ 38,394
Less: current portion				(38,394)
Total				$ -
Unused credit lines				$ -

December 31, 2025

	Currency	Interest rate collar	Year of expiry	Amount
Unsecured bank loans	USD	6.08%	115	$ 37,716
Less: current portion				(37,716)
Total				$ -
Unused credit lines				$ -

March 31, 2025

	Currency	Interest rate collar	Year of expiry	Amount
Unsecured bank loans	USD	6.53%	115	$ 79,692
Secured bank loans	USD	5.22%	114	531,280
”	RMB	4.2%	114	231,291
				842,263
Less: current portion				(802,417)
Total				$ 39,846
Unused credit lines				$ 166,025

A. For information on the Group’s assets pledged as collateral for bank borrowings, please refer to Note 8.

B. For information on the Group’s exposure to interest rate risk and liquidity risk, please refer to Note 6(19)

(10) Accounts payable and other payables

	March 31, 2026	December 31, 2025	March 31, 2025
Accounts payable
Arising from direct sales	$ 45,712	33,833	59,740
Arising from concessionaire sales	701,194	785,200	798,525
Others	64,506	69,256	74,339
Total	$ 811,412	888,289	932,604

Most of the payable arises from suppliers.

-29-

	March 31, 2026	December 31, 2025	March 31, 2025
Other payables
Wages and salaries payables	$ 68,016	95,751	74,090
Construction payables	84,424	83,801	82,132
Compensation payable for store closures, etc.	-	-	865
Compensation payable for lawsuit	25,363	24,527	75,910
Payables to related parties	575,910	565,740	597,690
Tax payables	18,725	27,073	20,048
Interest payables	61,314	52,105	-
Others	304,051	297,363	369,526
Total	$ 1,137,803	1,146,360	1,220,261

(11) Lease liabilities

The Group’s lease liabilities were as follows:

	March 31, 2026	December 31, 2025	March 31, 2025
Current	$ 1,015,398	1,024,169	909,256
Non-current	$ 7,857,489	8,700,673	9,753,728

Please refer to Note 6(19) financial instruments for maturity analysis.

The amounts recognized in profit or loss were as follows:

	For the three months ended March 31
	2026	2025
Interest on lease liabilities	$ 95,932	109,967
Expenses relating to short-term leases	$ 249	264
Expenses relating to leases of low-value, excluding short-term leases of low-value assets	$ 12	12

Total cash flow for the Group’s leases was as follows:

	For the three months ended March 31
	2026	2025
Total cash outflow for leases	$ 289,989	281,223

A. Lease of land, housing and construction

The Group leases land use rights, housing and buildings as office space and department store buildings for business. The lease period of office premises and department store buildings is usually with three years and ten to twenty years, respectively. Some leases include the option to extend the lease period at the end of the lease term.

Some leases provide for additional rent payments that are based on changes in local price indices, or sales that the Group makes at the leased store in the period.

B. Other leases

The lease period of the Group leased transportation and machinery and equipment is five to ten years. Some lease contracts stipulate that the Group has options to purchase the leased assets at the end of the lease term.

In addition, the period in which the Group leases part of the office is one year, and the leases are short-term leases. The Group chooses to apply the exemption recognition requirement without recognizing its related right-of-use assets and lease liabilities.

(12) Employee benefits

A. Defined contribution plans

Defined contribution plans of the employees in Taiwan office of the Group are plotted in accordance with Taiwan Labor Pension Act, where a contribution rate as 6% of the wage of a labor each month is conducted and contributed to the personal account of retirement created by the Bureau of Labor Insurance. After the Group has contributed the fixed amount to Bureau of Labor Insurance under the plans, it shall not assume any more legal or constructive obligations for paying an extra amount.

Defined benefit plans of the employees working in the Chinese subsidiaries are also applied with the contribution system, where an amount corresponding to the wage per month of the position as for an employee is to be contributed to his (or her) own account respectively. Whenever resigning or retiring from the job of an employee, the voluntary pension calculated by the subtraction of early withdrawn provident fund from actual cumulative voluntary amount over the years will be returned at one time; the pension contributed by company will be returned by the subtraction of early withdrawn provident fund during the tenure from actual cumulative provident fund contributed by company over the years multiplying percentage of seniority-based pay.

Pension expenses of the defined contribution plans of the Group for the three months ended March 31, 2026 and 2025 were NT$12,230 thousand and NT$12,803 thousand, respectively.

(13) Income tax

A. Income tax expense

The components of income tax were as follows:

-30-

	For the three months ended March 31
	2026	2025
Current tax expense
Current period	$ 11,194	16,597
Deferred tax expense
Origination and reversal of temporary differences	586	(5,856)
Income tax expenses from continuing operations	$ 11,780	10,741

B. Deferred tax assets

(A) Recognized deferred tax assets and liabilities

Changes in the amount of deferred tax assets and liabilities for the three months ended March 31, 2026 and 2025 were as follows:

Deferred tax assets:

	Tax losses deduction and other	Rental expenses	Total
Balance at January 1, 2026	$ 26,965	2,533,090	2,560,055
Recognized in profit or loss	43	(295,969)	(295,926)
Foreign currency translation differences for foreign operations	919	81,517	82,436
Balance at March 31, 2026	$ 27,927	2,318,638	2,346,565
Balance at January 1, 2025	$ 29,647	2,797,992	2,827,639
Recognized in profit or loss	-	(54,384)	(54,384)
Foreign currency translation differences for foreign operations	422	38,418	38,840
Balance at March 31, 2025	$ 30,069	2,782,026	2,812,095

Deferred tax liabilities:

	Retained earnings	Tax losses deduction	Total
Balance as of January 1, 2026	$ 16,767	1,967,815	1,984,582
Recognized in profit or loss	-	(295,340)	(295,340)
Influenced by fluctuation of exchange rates	302	62,266	62,568
Balance as of March 31, 2026	$ 17,069	1,734,741	1,751,810
Balance as of January 1, 2025	$ 17,490	2,254,842	2,272,332
Recognized in profit or loss	-	(60,240)	(60,240)
Influenced by fluctuation of exchange rates	224	30,521	30,745
Balance as of March 31, 2025	$ 17,714	2,225,123	2,242,837

C. Income tax verification situation

The income tax settlement filings of the mainland subsidiaries have been filed with the local tax authorities through 2024.

(14) Capital and other equity

Except for the following disclosures, there was no significant difference in capital and other equity for the three months ended March 31, 2026 and 2025. For the related information, please refer to the Note 6(14) of the consolidated financial statements for the year ended December 31, 2025.

A. Capital surplus

The components of the capital surplus were as follows:

	March 31, 2026	December 31, 2025	March 31, 2025
Premium on Issued Shares	$ 3,622,017	3,622,017	4,133,908
Treasury stock trading	25,333	25,333	25,333
Exercising the right of imputation	9,122	9,122	9,122
	$ 3,656,472	3,656,472	4,168,363

The Board of Directors proposed on March 30, 2026, and the shareholders' meeting resolved on June 12, 2025, to offset deficits of NT$890,325 thousand and NT$511,891 thousand, respectively, by utilizing capital surplus.

B. Retained earnings

Based on the articles of the company, the board should in accord with the measures and procedure described as below to draft the distribution of earnings and submit it to the shareholders meeting for approval by an ordinary resolution if there is any earning at general accounts annually of the company:

(A) Tax payables contributed by law;
(B) Compensation to the accumulated deficit by previous years;
(C) 10% as a contribution to the legal reserve in accordance with the applicable laws and regulations, except for when the legal reserve approaches the paid-in capital of the company;
(D) Contribution of the appropriated retained earnings by the applicable laws and regulations or the demands from a competent authority; and
(E) Profit available for distribution is the amount of earnings of the current year minus the sum from (A) to (D) above, and then plus cumulative retained earnings of the prior period. The board will propose the project of dividend distribution from it and then submit to the shareholders meeting for approval by an ordinary resolution according to the applicable laws and regulations.

Policies concerning the dividends of the company must take the environment as well as trends in the industry in the future, requirements for funds and financial structure into consideration. As for the profit available for distribution, except for an option of retaining, it can be distributed through equity dividends or cash dividends, which the latter is subject to be more than 10% of the total dividends.

(A) Legal reserve

When a company incurs no loss, it may, pursuant to a resolution by a shareholders’ meeting, distribute its legal reserve by issuing new shares or by distributing cash, and only the portion of legal reserve which exceeds 25% of capital may be distributed.

(B) Special reserve

The Group chose to apply the exemption under the IFRS1 “First-time adoption of IFRS”; therefore, a portion of cumulative translation adjustments amounting to thousand was reclassified as special earnings reserve. The net increase in retained earnings due to this reclassification is not covered by the Ruling No. 1010012865 issued by the FSC on April 6, 2012 for purposes of appropriating the same amount of special earnings reserve.

In accordance with the aforementioned Ruling, when the company distributes the distributable surplus, the net amount of other shareholders' equity deduction that occurs in the current year is supplemented as a special surplus reserve from the current profit and loss and the undistributed surplus of the previous period; it belongs to the deduction of other shareholders' equity accumulated in the previous period amount, the special surplus reserve shall not be distributed from the undistributed surplus of the previous period. If there is a subsequent reversal in the amount of reductions in other shareholders' equity, the surplus may be distributed for the reversed portion.

On March 30, 2026, the Board of Directors proposed the loss appropriation plan for the 2025 fiscal year. Separately, on June 12, 2025, the shareholders’ annual general meeting approved the loss appropriation plan for the 2024 fiscal year.

C. Treasury stock

The details for transferring treasury shares to employees:

| | (In thousands of shares)
For the three months ended
March 31 | |
| --- | --- | --- |
| | 2026 | 2025 |
| Outstanding at March 31 (same as January 1) | 3,663 | 3,663 |

The proceeds from transferring treasury shares were recognized as prepaid salary for employees to subscribe. As of March 31, 2026, December 31, 2025 and March 31, 2025, these prepaid salaries amounting to NT$131,333 thousand, NT$127,032 thousand and NT$131,157 thousand were recognized under other non-current assets – other. Considering the increasingly challenging environment in the department store industry, the Group has

taken steps to retain talent and maintain team stability. Furthermore, due to the impact of the COVID-19 pandemic, the profitability of the department store retail sector has not yet returned to pre-pandemic levels. To address these challenges, the Board of Directors resolved on November 13, 2024, and August 30, 2022, to defer the repayment of employees' advanced salaries to 2028 and 2025, respectively.

D. Other equity (net income after tax)

	Exchange difference on translation of foreign operations
Balance at January 1, 2026	$ (902,229)
Exchange difference on translation of net assets of foreign operations	159,912
Balance at March 31, 2026	$ (742,317)
Balance at January 1, 2025
Exchange difference on translation of net assets of foreign operations	$ (825,475)
Balance at March 31, 2025	66,533

(15) Earnings per share

Calculations of the basic as well as diluted earnings per share of the Group are as below:

	For the three months ended March 31
	2026	2025
Basic earnings (loss) per share
Net profit attributed to shareholder of common stock of the Company	$ (197,235)	(184,261)
Weighted average number of common shares outstanding	195,531	195,531
Basic earnings (loss) per share (NTD)	$ (1.01)	(0.94)

The Company did not disclose the diluted earnings (loss) per share for the three months ended March 31, 2026 and 2025, as there were losses before tax. Additionally, there were no potential ordinary shares of employee remuneration that could have diluted the earnings (loss) per share.

(16) Revenue from contracts with customers

A. Details of revenue

-35-

	For the three months ended March 31
	2026	2025
Main regional markets:
China	$ 725,245	796,329
Main product/service:
Commissions revenue (retail revenue – concessionaire sales)	$ 177,412	226,140
Commodity sales (retail revenue – direct sales)	125,777	139,743
Lease revenue (Note)	241,293	245,857
Service revenue and others	180,763	184,589
	$ 725,245	796,329

Note: The lease revenue and financial lease interest income of the Group are under IFRS 16.

(17) Employee compensation and directors' remuneration

According to the Articles of Association, once the Company has annual profit, it should appropriate no less than 1% of the profit to its employees and 3% or less as directors' and supervisor's remuneration. However, if the Company has accumulated deficits, the profit should be reserved to offset the deficit. The pervading target given via shares or cash includes dependent employees of the Company and Company's subsidiaries

As the company incurred loss before tax for the three months ended March 31, 2026 and 2025, no employee compensation and directors' remuneration were estimated and accrued.

(18) Non-operating income and expenses

A. Interest income

The details of other income were as follows:

	For the three months ended March 31
	2026	2025
Interest of back deposit	$ 3,140	7,105
Open-end funds	242	252
Total	$ 3,382	7,357

B. Other income

The details of other income were as follows:

	For the three months ended March 31
	2026	2025
Government grants income	$ 127	74

-36-

C. Other gains and losses

The details of other gains and losses were as follows:

	For the three months ended March 31
	2026	2025
Loss on disposal of property, plant and equipment	$ (133)	(222)
Foreign exchange gain (losses)	(8,303)	(643)
Net gain on financial assets at fair value through profit or loss	(608)	(646)
Overdue payments transferred to income	182	5,473
Other gains and losses (such as fees and charges of credit card, etc.)	(38,648)	10,000
Other gains and losses, net	$ (47,510)	13,962

D. Finance costs

The details of finance costs were as follows:

	For the three months ended March 31
	2026	2025
Interest expense	$ 39,548	41,858
Interest on lease liabilities	95,932	109,967
Finance costs, net	$ 135,480	151,825

(19) Financial instruments

Except for the contention mentioned below, there was no significant change in the fair value of the Group’s financial instruments and degree of exposure to credit risk, liquidity risk and market risk arising from financial instruments. For the related information, please refer to Note 6(19) of the consolidated financial statements for the year ended December 31, 2025.

A. Credit risks

(A) Exposure of credit risk

Carrying amount of a financial asset represents the maximum amount of credit risk exposure.

(B) Concentration of credit risk

There is no significant concentration on single customer in the Group’s retail business, and debtors of accounts receivable are banks with high credit rating; therefore, management believes that there is no significant concentration of credit risk.

For credit risk exposure of accounts receivables, please refer to Note 6(3).

Other financial assets at amortized cost includes other receivables etc., as stated above,

there were almost low credit risk, therefore the impairment provision of all of these financial assets recognized during the period was limited to 12 months expected losses or lifetime ECL measurement, please refer to Note 4(7) of the consolidated financial statements for the year ended December 31, 2025.

The movement in the allowance for impairment for other receivables for the three months ended March 31, 2026 and 2025 were as follows:

	For the three months ended March 31
	2026	2025
Balance at January 1	$ 345,847	343,208
Influenced by fluctuation of exchange rates	11,783	4,891
Balance at March 31	$ 357,630	348,099

B. Liquidity risks

The following table shows the contractual maturities of financial liabilities, including estimated interest payments and excluding the impact of netting agreements.

	Carrying amount	Contract cash flows	Within 1 Year	1 – 5 Years	Over 5 Years
March 31, 2026
Non-derivative financial liabilities
Floating rate instruments $	4,043,307	4,133,474	4,133,474	-	-
Non-interest-bearing	1,934,383	1,934,383	1,373,306	-	561,077
Lease liabilities	8,872,887	11,332,345	1,383,068	4,592,290	5,356,987
	$ 14,850,577	17,400,202	6,889,848	4,592,290	5,918,064
December 31, 2025
Non-derivative financial liabilities
Floating rate instruments $	3,664,905	3,758,066	3,758,066	-	-
Non-interest-bearing	2,016,087	2,016,087	1,468,909	-	547,178
Lease liabilities	9,724,842	12,375,244	1,425,323	4,954,183	5,995,738
	$ 15,405,834	18,149,397	6,652,298	4,954,183	6,542,916
March 31, 2025
Non-derivative financial liabilities
Floating rate instruments $	1,540,712	1,579,450	1,538,737	40,713	-
Fixed rate instruments	2,399,102	2,453,438	2,453,438	-	-
Non-interest-bearing	2,137,562	2,137,562	1,555,175	-	582,387
Lease liabilities	10,662,984	13,740,699	1,350,573	5,350,841	7,039,285
	$ 16,740,360	19,911,149	6,897,923	5,391,554	7,621,672

The Group does not expect the cash flows included in the maturity analysis to occur significantly earlier or at significantly different amounts.

C. Interest rate analysis

The Group's financial assets and financial liabilities with interest rate exposure risk as of the reporting date were as follows:

	Carrying amount
	March 31, 2026	December 31, 2025	March 31, 2025
Fixed interest rate
Financial asset	$ 798,749	738,200	788,044
Financial liability	(8,872,887)	(9,758,485)	(13,062,086)
	$ (8,074,138)	(9,020,285)	(12,274,042)
Variable interest rate
Financial asset	$ 291,760	238,590	441,909
Financial liability	(4,043,307)	(3,664,905)	(1,540,712)
	$ (3,751,547)	(3,426,315)	(1,098,803)

The following sensitivity analysis is based on the exposure to the interest rate risk of derivative and non-derivative financial instruments at the reporting date. Regarding of liabilities with floating interest rates, the analysis is based on the assumption that the amount of liabilities outstanding at the reporting date was outstanding throughout the year. The rate of change is expressed as the interest rate increases or decreases by $0.5\%$ when reporting to management internally, which also represents the Group management's assessment of the reasonably possible interest rate change.

If the interest rate were to increase or decrease by $0.5\%$ basis points, with all other variables held constant, the Group's losses before tax for the three months ended March 31, 2026 and 2025, would increase or decrease by NT$4,689 thousand and NT$1,374 thousand, respectively.

D. Other market price risk

If the security price changes, the impact of security price change to other comprehensive income will be as follows, assuming the analysis is based on the same basis for both years and assuming that all other variables considered in the analysis remain the same:

	For the three months ended March 31
	2026		2025
Reporting day security prices	Other comprehensive income before tax	Profit or loss before tax	Other comprehensive income before tax	Profit or loss before tax
5% Increase	$ -	600	-	609
5% Decrease	$ -	(600)	-	(609)

E. Information of fair value

(A) Measurement process of fair value of financial instruments

Accounting policies and disclosure of the Group include the assets and liabilities financial or non-financial measured by fair value. The Group is to build an inner control system concerning fair value measurement. Wherein it includes an evaluation team to be responsible for reviewing all the assessments of fair value (including a Level 3 fair value), and this team will directly report to the CFO. The evaluation team will review the material inputs non-observable and adjust them periodically. If an input used for measuring fair value comes from the 3rd party information (such as a broker or pricing service institution), the team shall assess the evidence of this input provided and supported by the 3rd party, in order to ensure that this evaluation and the hierarchy classification of its fair value comply with IFRS.

The Group shall use an observable input in the market as possible as it can when measuring the assets and liabilities. Fair value hierarchy is classified according to the input used of evaluation techniques:

Level 1: Opening quotes (unadjusted) from the same assets or liabilities in an active market.
Level 2: Except for the opening quotes in Level 1, input parameters of the assets or liabilities can be directly (i.e. price) or indirectly (i.e. inference from price) observed.
Level 3: Input parameters of the assets or liabilities not based on the observable market information (non-observable parameters).

(B) Classifications of financial instruments and fair value

The Group measures the fair value based on repeatability by the financial assets and liabilities measured by fair value through profit or loss. Carrying amount and fair value of all kinds of financial assets and liabilities (including fair value hierarchy, yet carrying amount of the financial instruments not measured by fair value are those ones having the fair value to that are reasonably approximate) are listed as below:

	March 31, 2026
	Carrying amount	Fair Value
		Level 1	Level 2	Level 3	Total
Financial assets measured by fair value through profit or loss
Non-derivative financial assets measured by fair value through profit or loss by enforcement	$ 11,999	11,999	-	-	11,999

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December 31, 2025

	Carrying amount	Fair Value
		Level 1	Level 2	Level 3	Total
Financial assets measured by fair value through profit or loss
Non-derivative financial assets measured by fair value through profit or loss by enforcement	$ 12,394	12,394	-	-	12,394

March 31, 2025

	Carrying amount	Fair Value
		Level 1	Level 2	Level 3	Total
Financial assets measured by fair value through profit or loss
Non-derivative financial assets measured by fair value through profit or loss by enforcement	$ 12,177	12,177	-	-	12,177

The Group’s valuation techniques and assumptions used for financial instruments not measured at fair value are as follows:

a. Financial assets or liabilities measured at amortized cost

If there is quoted price generated by transactions, the recent transaction price and quoted price data is used as the basis for fair value measurement. However, if no quoted prices are available, the discounted cash flows are used to estimate fair values.

(D) Valuation techniques for financial instruments measured at fair value

a. Non-derivative financial instruments

A financial instrument is regarded as being quoted in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency and those prices represent actual and regularly occurring market transactions on an arm’s length basis. Whether transactions are taking place ‘regularly’ is a matter of judgment and depends on the facts and circumstances of the market for the instrument.

Quoted market prices may not be indicative of the fair value of an instrument if the activity in the market is infrequent, the market is not well established, only small volumes are traded, or bid ask spreads are very wide. Determining whether a market is active involves judgment.

If the Group’s financial instruments are regarded as being quoted in an active market, the classification and property of fair value are as follows:

Stocks in listed companies, fund and corporate bonds, which have standard term and quoted prices in active markets. The fair values are referenced by market

quotation.

(E) For the three months ended March 31, 2026 and 2025 fair value of the financial assets as well as liabilities at each level did not transfer at all.

(20) Financial risk management

Except for the matters described below, there were no significant changes in the Group's financial risk management objectives and policies as disclosed in Note 6(20) of the consolidated financial statements for the year ended December 31, 2025.

A. Liquidity risk

Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations. The Group's approach to managing liquidity is to ensure, as far as possible, that it always has sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group's reputation.

Due to the nature of its retail business, the Group generates ample cash flows from its operating activities. Generally, the Group ensures that it has sufficient cash to cover its expected operating expenses for a period of 60 to 90 days, including the fulfillment of financial obligations. However, this expectation excludes potential impacts from extreme, unforeseeable events, such as natural disasters. In addition, as of March 31, 2026, December 31, 2025, and March 31, 2025, the Group had unused loan facilities of NT$271,582 thousand, NT$661,630 thousand, and NT$500,274 thousand, respectively.

As of March 31, 2026, the Group's current assets were less than its current liabilities. The Group will continue discussions with banks and plans to adjust its borrowing structure by converting U.S. dollar-denominated borrowings into RMB-denominated borrowings in order to reduce borrowing interest rates. Given the nature of the department store industry, where there are no significant current assets such as inventory, it is common for current assets to be less than current liabilities. The Group has been continuously evaluating the aforementioned plans and does not anticipate any liquidity risk concerns.

(21) Capital management

Management believes that the objectives, policies and processes of capital management of the Group has been applied consistently with those described in the consolidated financial statements for the year ended December 31, 2025. Also, management believes that there were no significant changes in the Group's capital management information as disclosed for the year ended December 31, 2025. Please refer to Note 6(21) of the consolidated financial statements for the year ended December 31, 2025 for further details.

(22) Investment and financing activities in non-cash transactions

The Group's investing and financing activities on non-cash transactions for the three months ended March 31, 2026 and 2025 were as follows:

A. The reconciliation of liabilities from financing activities is as follows:

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-42-

	Non-cash changes
	January 1, 2026	Cash flows	Foreign exchange movement	Other	March 31, 2026
Short-term borrowings	$ 3,061,449	271,998	95,556	-	3,429,003
Long-term borrowings	37,716	-	678	-	38,394
Guarantee deposits	547,178	(4,669)	18,568	-	561,077
Other related parties	565,740	-	10,170	-	575,910
				(Note)
Lease liabilities	9,724,842	(193,796)	312,497	(970,656)	8,872,887
Total liabilities from financing activities	$13,936,925	73,533	437,469	(970,656)	13,477,271
			Non-cash changes
	January 1, 2025	Cash flows	Foreign exchange movement		March 31, 2025
Short-term borrowings	$ 2,539,845	(73,733)		33,749	2,499,861
Long-term borrowings	831,285	-		10,978	842,263
Guarantee deposits	590,775	(16,369)		7,981	582,387
Other related parties	590,130	-		7,560	597,690
Lease liabilities	10,686,259	(170,980)		147,705	10,662,984
Total liabilities from financing activities	$ 15,238,294	(261,082)		207,973	15,185,185

Note : Decrease of NT$970,656 thousand due to lease modification.

7. Related-party transactions:

(1) Names and relationships with related parties

All the related parties who have transacted with the Group during the coverage period of the consolidated financial statements are as below:

Name of Related Party	Relationship with the Group
First Steamship Co., Ltd.	Entity with significant influence over the Group (Note)
First Steamship S.A.	Entity with significant influence over the Group (Note)
Ahead Capital Ltd.	The Group’s other related parties
Shanghai Guorui Tongshun Environmental Protection Technology Co., Ltd.	Management of the Group serves as director of the company.
Shanghai Allied Cement Holdings Limited	Management of the Group serves as director of the company.

Note: Effective December 30, 2025, the entity disposed of its equity interest in the Group and is no longer the parent company; however, it continues to have significant influence over the Company.

(2) Significant transactions with related parties

A. Prepayments

	March 31, 2026	December 31, 2025	March 31, 2025
Entity with significant influence over the Group - First Steamship Co., Ltd.	$ 70	70	70

B. Borrow from related parties (recognized as other payables)

The amounts borrowed by the Group from related parties are as follows:

	March 31, 2026	December 31, 2025	March 31, 2025
Entity with significant influence over the Group - First Steamship S.A.	$ 575,910	565,740	597,690

As of March 31, 2026, December 31, 2025, and March 31, 2025, the Group's borrowings from related parties bore interest at floating rates, adjusted quarterly, of 5.50% to 6.50%, 4.01% to 5.50%, and 4.35%, respectively. For the three months ended March 31, 2026 and 2025, the recognized interest expenses were NT$8,492 thousand and NT$6,431 thousand, respectively. As of March 31, 2026, December 31, 2025, and March 31, 2025, the unpaid interest amounted to NT$59,575 thousand, NT$50,053 thousand, and NT$32,352 thousand, respectively.

C. Lease

(A) Liabilities lease

Relationship	Purpose	Lease liabilities
		March 31, 2026	December 31, 2025	March 31, 2025
Other related parties	Energy-saving renovation engineering equipment	$ 3,874	4,583	7,276

Note: The price and payment method of the above-mentioned lease agreement signed with the related party are handled in accordance with the agreement of both parties.

		Interest Expense
		For the three months ended March 31
Relationship	Purpose	2026	2025
Other related parties	Energy-saving renovation engineering equipment	$ 50	91

(B) Operating lease

		Rent expense
		For the three months ended March 31
Relationship	Account	2026	2025
Entity with significant influence over the Group - First Steamship Co., Ltd. (Note)	Office building	$ 211	211
Other related parties (Note)	Office building	38	53
		$ 249	264

Note: These leases are short-term lease, and the Group chooses to apply the exemption recognition requirement without recognizing its related right-of-use assets and liabilities.

Account items	Relationship category	March 31, 2026	December 31, 2025	March 31, 2025
Other financial assets - non-current	Entity with significant influence over the Group - First Steamship Co., Ltd.	$ 148	148	148

(3) Key management personnel compensation

A. Key management personnel compensation comprised:

	For the three months ended March 31
	2026	2025
Short-term employee benefits	$ 5,384	5,984

B. The Group granted key management personnel rights to subscribe treasury shares in advance salaries. As of March 31, 2026, December 31, 2025, and March 31, 2025, those prepaid salaries amounting to NT$40,752 thousand (CNY 8,813 thousand), NT$39,409 thousand (CNY 8,813 thousand) and NT$40,926 thousand (CNY 8,847 thousand), respectively, were recorded as non-current assets - other.

Pledged assets:

The carrying amount of pledged assets were as follows:

Pledged asset	Object	March 31, 2026	December 31, 2025	March 31, 2025
Property, Plants and Equipment (Note)	Bank Loans	$ 5,700,691	5,558,393	4,886,607
Other financial assets
Restricted Deposit	Bank depository funds	11,939	11,532	13,095
Restricted Deposit	Lease dispute freeze deposit	34,922	927	309
Restricted Deposit	Bank loans	751,888	725,741	748,740
		$ 6,499,440	6,296,593	5,648,751

Note: Including the land use right, which are recognized as right-of-use assets.

Significant contingent liabilities and unrecognized contract commitments:

(1) As of March 31, 2026, December 31, 2025, and March 31, 2025, the promissory notes issued by the Group for financing obtained from related parties amounted to NT$607,905 thousand, NT$597,170 thousand and NT$630,895 thousand, respectively.

(2) While the Group acquired the Quanzhou real estate, the assignor, Quanzhou FuHua Co., Ltd., failed to comply with the term of the contract, which stated that the assignor should repay the mortgage loan secured by the fourth floor of Quanzhou real estate with the consideration paid by the Group to release the mortgage. Therefore, the mortgagee filed an application to freeze the rent earned from the fourth floor of Quanzhou real estate in June 2020. The Group evaluates that the creditor still has means to repay the mortgage loan; hence, the fourth floor of Quanzhou real estate may not be at risk of impairment.

(3) Wuhan Hanyang Grand Ocean Classic Commercial Limited, a subsidiary of the Group, ceased operations on August 31, 2023, due to sustained losses. It terminated its lease agreement with Wuhan Laopai Catering Management Co., Ltd. (hereinafter referred to as "Laopai Company") prematurely. Consequently, Laopai Company filed for arbitration on December 20, 2023, requesting the Group to refund the performance bond and pay early termination penalties, renovation losses, and related litigation expenses, totaling NT$27,085 thousand (CNY 6,101 thousand). On October 12, 2024, in accordance with the arbitration ruling, the Group was required to compensate Laopai Company for the aforementioned expenses totaling NT$25,363 thousand (CNY 5,485 thousand). The Group accrued the amount in 2024, recorded under other payables and other gains and losses. As of March 31, 2026, the amount had not yet been paid.

(4) The Group's subsidiary, Wuhan Grand Ocean Classic Commercial Development Limited, leased counter space to Hubei Lvshu Cybercafe Development Co., Ltd. (hereinafter referred to as "Lvshu Cybercafe"). However, Lvshu Cybercafe failed to pay the rental as due.

-45-

Accordingly, the Group terminated the lease agreement on September 30, 2025, and filed a lawsuit with the court seeking the recovery of overdue rental, management service fees, penalties for breach of contract, and related litigation expenses, totaling NT$5,761 thousand (CNY 1,266 thousand).

However, in January 2026, Lvshu Cybercafe filed a lawsuit against the Group, claiming that the lease agreement had not yet expired, and requested the return of rental and management service fees previously collected by the Group, as well as compensation for early termination penalties, operating renovation losses, and other related expenses, totaling NT$30,273 thousand (CNY 6,653 thousand). Based on the Group’s assessment, since Lvshu Cybercafe had defaulted on rental payments prior to the termination, the Group believes that the claims asserted by Lvshu Cybercafe are without merit and that the Group has no obligation for compensation. The case is currently pending before the court.

In addition, in January 2026, Lvshu Cybercafe applied to the court for asset preservation. The court, in accordance with the law, froze the Group’s bank deposits of NT$21,363 thousand (CNY 4,620 thousand), which were recognized under other financial assets – current.

10. Losses due to major disasters: None

11. Subsequent events: None

12. Other

(1) A summary of current-period employee benefits, depreciation, depletion and amortization, by function, is as follows:

	For the three months ended March 31
Function	2026			2025
Item	Operating cost	Operating expense	Total	Operating cost	Operating expense	Total
Employee benefits
Salary	-	93,594	93,594	-	96,396	96,396
Health and labor insurance	-	113	113	-	124	124
Pension	-	12,230	12,230	-	12,803	12,803
Others	-	19,840	19,840	-	22,744	22,744
Depreciation	-	332,805	332,805	-	369,740	369,740
Amortization	-	607	607	-	576	576

(2) Seasonality of operations

The Group's retail business is subject to seasonal fluctuations as a result of vacation. Thus, this industry typically has higher revenues and results for the first and fourth quarter of the year.

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13. Other disclosures:

(1) Information on significant transactions:

The following were the information on significant transactions required by the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” for the Group for the three months ended March 31, 2026:

A. Loans to other parties: Refer to table 1.

B. Guarantees and endorsements for other parties: Refer to table 2.

C. Holding of significant marketable securities at the end of the period (excluding investment in subsidiaries, associates and joint ventures): Refer to table 3.

D. Related-party transactions for purchases and sales with amounts exceeding the lower of NT$100,000 thousand or 20% of the capital stock: None.

E. Receivables from related parties with amounts exceeding the lower of NT$100,000 thousand or 20% of the capital stock: Refer to table 4.

F. Business relationships and significant intercompany transactions: Refer to table 5.

(2) Information on investees (excluding investees in Mainland China): Refer to table 6.

(3) Information on investment in mainland China: Refer to table 7.

14. Segment information

(1) General information:

The main revenue of the Group comes from department store retail. The chief operating decision-maker of the Group uses the overall operating results as the basis for evaluating performance. Accordingly, the Group is a single operating department, and the operating department information for the three months ended March 31, 2026 and 2025 is consistent with the consolidated financial report information.

(2) Information of products and services: The Group belongs to department store retail business.

(3) Information of regional finance: Sales regions of the retail commodity are all in China.

(4) Information on major customers: Sales objects of the Group are all general consumers, and there is no dependence upon the major customers.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries Notes to the Consolidated Financial Statements (Continued)

Table 1 Loans to others
For the three months ended March 31, 2026

No.	Creditor	Borrower	General ledger account	Is a related party	Maximum outstanding balance during the three months ended March 31, 2026	Balance at March 31, 2026	Actual amount drawn down	Interest rate	Nature of loan	Amount of transactions with the borrower	Reason for short-term financing	Allowance for doubtful accounts	Collateral		Limit on loans granted to a single party	Ceiling on total loans granted
													Item	Value
1	Grand Citi Ltd.	Grand Ocean Retail Group Ltd.	Other receivables - related parties	Y	735,885	735,885	672,912	3.50%	2	-	Operating capital	-	-	-	69,656,840	69,656,840
1	Grand Citi Ltd.	Grand Ocean Classic Commercial Group Co., Ltd	Other receivables - related parties	Y	279,956	279,956	230,231	0.00%	2	-	Operating capital	-	-	-	69,656,840	69,656,840
2	Grand Ocean Classic Commercial Group Co., Ltd	Hengyang Grand Ocean Commercial Development Limited	Other receivables - related parties	Y	346,797	346,797	343,930	0.00%	2	-	Operating capital	-	-	-	59,024,600	59,024,600
2	Grand Ocean Classic Commercial Group Co., Ltd	Quanzhou Grand Ocean Commercial Limited	Other receivables - related parties	Y	1,525,905	1,525,905	1,509,722	0.00%	2	-	Operating capital	-	-	-	59,024,600	59,024,600
2	Grand Ocean Classic Commercial Group Co., Ltd	Fuzhou Grand Ocean Classic Commerce Limited	Other receivables - related parties	Y	1,618,385	1,618,385	1,528,448	0.00%	2	-	Operating capital	-	-	-	59,024,600	59,024,600
2	Grand Ocean Classic Commercial Group Co., Ltd	Fuzhou Jiaruixing Business Administration Limited	Other receivables - related parties	Y	215,015	215,015	187,733	0.00%	2	-	Operating capital	-	-	-	59,024,600	59,024,600
2	Grand Ocean Classic Commercial Group Co., Ltd	Fuzhou Grand Ocean Commercial Limited	Other receivables - related parties	Y	380,553	380,553	278,826	0.00%	2	-	Operating capital	-	-	-	59,024,600	59,024,600
2	Grand Ocean Classic Commercial Group Co., Ltd	Wuhan Grand Ocean Classic Commercial Development Limited	Other receivables - related parties	Y	53,176	53,176	1,618	0.00%	2	-	Operating capital	-	-	-	59,024,600	59,024,600
2	Grand Ocean Classic Commercial Group Co., Ltd	Shanghai Grand Ocean Qianshu Commercial Management Co., Ltd	Other receivables - related parties	Y	323,679	323,679	323,474	0.00%	2	-	Operating capital	-	-	-	59,024,600	59,024,600
2	Grand Ocean Classic Commercial Group Co., Ltd	Grand Ocean Retail Group Ltd.	Other receivables - related parties	Y	767,880	767,880	729,486	3.5%–3.95%	2	-	Operating capital	-	-	-	59,024,600	59,024,600
3	Fuzhou Grand Ocean Commercial Limited	Fuzhou Jiaruixing Business Administration Limited	Other receivables - related parties	Y	34,680	34,680	34,680	0.00%	2	-	Operating capital	-	-	-	16,604,680	16,604,680

No.	Creditor	Borrower	General ledger account	Is a related party	Maximum outstanding balance during the three months ended March 31, 2026	Balance at March 31, 2026	Actual amount drawn down	Interest rate	Nature of loan	Amount of transactions with the borrower	Reason for short-term financing	Allowance for doubtful accounts	Collateral		Limit on loans granted to a single party	Ceiling on total loans granted
													Item	Value
3	Fuzhou Grand Ocean Commercial Limited	Wuhan Grand Ocean Classic Commercial Development Limited	Other receivables - related parties	Y	226,574	226,574	226,574	0.00%	2	-	Operating capital	-	-	-	16,604,680	16,604,680
4	Nanjing Grand Ocean Classic Commercial Limited	Grand Ocean Classic Commercial Group Co., Ltd	Other receivables - related parties	Y	2,534,668	2,534,668	2,517,698	0.10%	2	-	Operating capital	-	-	-	21,380,150	21,380,150
5	Wuhan Grand Ocean Classic Commercial Development Limited	Grand Ocean Classic Commercial Group Co., Ltd	Other receivables - related parties	Y	9,248	9,248	-	0.00%	2	-	Operating capital	-	-	-	16,504,330	16,504,330
5	Wuhan Grand Ocean Classic Commercial Development Limited	Shiyan Grand Ocean Commerce Limited	Other receivables - related parties	Y	478,581	478,581	443,439	0.00%	2	-	Operating capital	-	-	-	16,504,330	16,504,330
5	Wuhan Grand Ocean Classic Commercial Development Limited	Hengyang Grand Ocean Commercial Development Limited	Other receivables - related parties	Y	190,231	190,231	190,231	0.00%	2	-	Operating capital	-	-	-	16,504,330	16,504,330
5	Wuhan Grand Ocean Classic Commercial Development Limited	Wuhan Hanyang Grand Ocean Classic Commercial Limited	Other receivables - related parties	Y	106,352	106,352	103,213	0.00%	2	-	Operating capital	-	-	-	16,504,330	16,504,330
6	Yichang Grand Ocean Commerce Limited	Grand Ocean Classic Commercial Group Co., Ltd	Other receivables - related parties	Y	1,056,576	1,056,576	1,038,542	0.00%	2	-	Operating capital	-	-	-	5,649,780	5,649,780
6	Yichang Grand Ocean Commerce Limited	Wuhan Grand Ocean Classic Commercial Development Limited	Other receivables - related parties	Y	92,480	92,480	84,468	0.00%	2	-	Operating capital	-	-	-	5,649,780	5,649,780
6	Yichang Grand Ocean Commerce Limited	Wuhan Optics Valley Grand Ocean Commercial Development Limited	Other receivables - related parties	Y	243,683	243,683	222,875	0.00%	2	-	Operating capital	-	-	-	5,649,780	5,649,780
7	Hefei Grand Ocean Classic Commercial Development Limited	Grand Ocean Classic Commercial Group Co., Ltd	Other receivables - related parties	Y	457,774	457,774	444,734	0.00%	2	-	Operating capital	-	-	-	3,115,960	3,115,960
8	Shanghai Jingxuan Business Administration Limited	Grand Ocean Classic Commercial Group Co., Ltd	Other receivables - related parties	Y	32,368	32,368	32,136	0.00%	2	-	Operating capital	-	-	-	359,650	359,650
9	Wuhan Optics Valley Grand Ocean Commercial Development Limited	Grand Ocean Classic Commercial Group Co., Ltd	Other receivables - related parties	Y	161,840	161,840	149,817	0.00%	2	-	Operating capital	-	-	-	18,323,530	18,323,530
9	Wuhan Optics Valley Grand Ocean Commercial Development Limited	Wuhan Grand Ocean Classic Commercial Development Limited	Other receivables - related parties	Y	165,307	165,307	141,725	0.00%	2	-	Operating capital	-	-	-	18,323,530	18,323,530

No.	Creditor	Borrower	General ledger account	Is a related party	Maximum outstanding balance during the three months ended March 31, 2026	Balance at March 31, 2026	Actual amount drawn down	Interest rate	Nature of loan	Amount of transactions with the borrower	Reason for short-term financing	Allowance for doubtful accounts	Collateral		Limit on loans granted to a single party	Ceiling on total loans granted	Note
													Item	Value
9	Wuhan Optics Valley Grand Ocean Commercial Development Limited	Wuhan Hanyang Grand Ocean Classic Commercial Limited	Other receivables - related parties	Y	78,608	78,608	77,213	0.00%	2	-	Operating capital	-	-	-	18,323,530	18,323,530
10	Quanzhou Grand Ocean Commercial Limited	Sanhe Xiansen Trading Co., Ltd.	Other receivables	N	4,624	4,624	4,624	0.00%	2	-	Operating capital	4,624	-	-	10,860	10,860	Note 5

Note 1: Nature of the lending of funds: (2) Necessary for short-term financing.
Note 2: Maximum outstanding balance during the three months ended March 31, 2026 and Balance at March 31, 2026 represent the amounts of credit facilities.
Note 3: In accordance with the loans to other procedures of Grand Ocean Retail Group Ltd. and its subsidiaries, the total amount of loans shall not exceed $40\%$ of the net worth of the lending company's most recent financial statements, and the amount of individual transactions shall not exceed the amount of business transactions between the two parties. For non-ROC companies which do not directly or indirectly own $100\%$ of the voting shares, the amount of the loan is limited to $40\%$ of the lending company's net worth as shown in the most recent financial statements. Furthermore, for companies that directly or indirectly hold $100\%$ of the voting shares of non-ROC companies, or non-ROC companies that are directly or indirectly $100\%$ owned by such companies, the total and individual amounts of funds lent to Grand Ocean Retail Group Ltd. shall each be limited to $1000\%$ of the net value based on the most recent financial statements of the lending company.
Note 4: The transactions of the aforementioned subsidiaries have been eliminated in the preparation of the consolidated financial statements.
Note 5: Quanzhou Grand Ocean Commercial Ltd. granted a loan of (4,624 thousand to Sanhe Xiansen Trading Co., Ltd. and the court ruled in favor of Quanzhou Grand Ocean Commercial Ltd. in the second trial, but the Group assessed that it would be difficult to recover the loan, so an allowance for doubtful debt was recognized for the entire amount.

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Notes to the Consolidated Financial Statements (Continued)

Table 2 Provision of endorsements and guarantees to others
For the three months ended March 31, 2026

No.	Endorser/guarantor	Guaranteed party		Limit on endorsement/guarantee to each guaranteed party	Maximum balance for the period	Ending balance	Amount actually drawn	Amount of endorsement/guarantee collateralized by properties	Ratio of accumulated endorsement/guarantee amount to net equity per latest financial statement	Maximum endorsement/guarantee amount allowable	Guarantee provided by parent company	Guarantee provided by subsidiary	Guarantee provided to subsidiaries in Mainland China
		Company name	Relationship
1	Grand Ocean Classic Commercial Group Co., Ltd	Grand Ocean Retail Group Ltd.	3	40,116,105	831,870	831,870	831,870	Note 3	14.09%	40,116,105	N	Y	N
1	Grand Ocean Classic Commercial Group Co., Ltd	Wuhan Grand Ocean Classic Commercial Development Limited	2	40,116,105	624,234	624,234	392,668	-	10.58%	40,116,105	Y	N	Y
1	Grand Ocean Classic Commercial Group Co., Ltd	Shanghai Grand Ocean Qianshu Commercial Management Co., Ltd	2	40,116,105	231,198	231,198	69,351	-	3.92%	40,116,105	Y	N	Y
2	Fuzhou Grand Ocean Classic Commerce Limited	Grand Ocean Classic Commercial Group Co., Ltd	3	7,509,555	3,236,769	2,543,176	2,135,115	961,942	-1474.52%	7,509,555	N	Y	Y
3	Wuhan Optics Valley Grand Ocean Commercial Development Limited	Grand Ocean Classic Commercial Group Co., Ltd	3	16,815,405	2,080,780	1,387,187	1,386,996	2,023,868	75.71%	16,815,405	N	Y	Y
4	Fuzhou Grand Ocean Commercial Limited	Wuhan Grand Ocean Classic Commercial Development Limited	2	10,447,375	624,234	624,234	392,668	506,583	37.59%	10,447,375	Y	N	Y
4	Fuzhou Grand Ocean Commercial Limited	Shanghai Grand Ocean Qianshu Commercial Management Co., Ltd	4	10,447,375	231,198	231,198	69,351	506,583	13.92%	10,447,375	N	N	Y
5	Quanzhou Grand Ocean Commercial Limited	Grand Ocean Classic Commercial Group Co., Ltd	3	7,997,760	2,080,780	1,387,187	1,386,996	1,108,097	5109.16%	7,997,760	N	Y	Y
6	Wuhan Grand Ocean Classic Commercial Development Limited	Grand Ocean Classic Commercial Group Co., Ltd	3	23,847,875	1,155,989	1,155,989	748,119	1,100,201	70.04%	23,847,875	N	Y	Y

Note 1: In accordance with the Company's and its subsidiaries' procedures governing endorsements and guarantees, the total amount of endorsements and guarantees provided by the Company and each subsidiary, as well as the amount provided to any single enterprise, shall not exceed ten times the net worth as stated in the Company's most recent financial statements. Upon review, there were no instances of exceeding the prescribed limits in the current period.
Note 2: In accordance with the aforementioned procedures, for entities in which the Company directly or indirectly holds, or is held, more than 50% of the voting shares, the total amount of endorsements and guarantees and the amount provided to any single enterprise by Grand Ocean Classic Commercial Group Co., Ltd and its subsidiaries shall not exceed five times the total assets as stated in their most recent financial statements.
Note 3: Standby letters of credit (Standby L/C) and time deposits amounting to NT$750,291 thousand were provided as guarantees.
Note 4: Relationship with the endorsed/guaranteed parties:
(1) Companies having business transactions with the Company.
(2) Companies in which the Company directly or indirectly holds more than 50% of the voting shares.

(3) Companies that directly or indirectly hold more than 50% of the voting shares of the Company.

(4) Companies in which the Company directly or indirectly holds 90% or more of the voting shares.

(5) Companies within the same industry or joint constructors that provide mutual guarantees in accordance with contractual agreements due to project contracting requirements.

(6) Companies for which all investing shareholders provide endorsements/guarantees in proportion to their shareholdings due to joint investment relationships.

(7) Companies within the same industry providing joint and several guarantees for pre-sale housing contracts in accordance with consumer protection regulations.

Note 5: Subsidiaries Fuzhou Grand Ocean Classic Commerce Limited, Wuhan Optics Valley Grand Ocean Commercial Development Limited, and Quanzhou Grand Ocean Commercial Limited jointly provided endorsements and guarantees for Grand Ocean Classic Commercial Group Co., Ltd. The total endorsed/guaranteed amount at the end of the period was NT$4,161,561 thousand as a jointly shared credit facility, with an actual risk exposure of NT$1,387,187 thousand.

Subsidiaries Grand Ocean Classic Commercial Group Co., Ltd and Fuzhou Grand Ocean Commercial Limited jointly provided endorsements and guarantees for Wuhan Grand Ocean Classic Commercial Development Limited. The total endorsed/guaranteed amount at the end of the period was NT$1,248,468 thousand as a jointly shared credit facility, with an actual risk exposure of NT$624,234 thousand.

Subsidiaries Fuzhou Grand Ocean Classic Commerce Limited and Wuhan Grand Ocean Classic Commercial Development Limited jointly provided endorsements and guarantees for Grand Ocean Classic Commercial Group Co., Ltd. The total endorsed/guaranteed amount at the end of the period was NT$2,311,978 thousand as a jointly shared credit facility, with an actual risk exposure of NT$1,155,989 thousand.

Subsidiaries Grand Ocean Classic Commercial Group Co., Ltd and Fuzhou Grand Ocean Commercial Limited jointly provided endorsements and guarantees for Shanghai Grand Ocean Qianshu Commercial Management Co., Ltd. The total endorsed/guaranteed amount at the end of the period was NT$462,396 thousand as a jointly shared credit facility, with an actual risk exposure of NT$231,198 thousand.

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GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)

Table 3 Significant marketable securities held (excluding investments in subsidiaries, affiliates and joint ventures)
March 31, 2026

Holding company name	Type and name of marketable securities	Relationship with the holding company	Financial statement account	March 31, 2026				Note
				Shares/Units	Carrying value	Percentage of ownership (%)	Fair value
Grand Ocean Retail Group Ltd.	Funds of Allianz Income and Growth	-	Financial assets at fair value through profit or loss - current	46,510	11,999	-	11,999

-54-

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Notes to the Consolidated Financial Statements (Continued)

Table 4 Receivables from related parties reaching NT$100 million or 20% of the Company’s paid-in capital or more
March 31, 2026

Related party	Company name	Relationship	Ending balance (Note 1)	Turnover rate (%)	Overdue		Amounts received in subsequent period	Allowance for impairment loss
					Amount	Actions taken
Grand Citi Ltd.	GRAND OCEAN RETAIL GROUP LTD.	The parent company	672,912	-	-		-	-
Grand Citi Ltd.	Grand Ocean Classic Commercial Group Co., Ltd	Wholly-owned subsidiary	230,231	-	-		-	-
Grand Ocean Classic Commercial Group Co., Ltd	Hengyang Grand Ocean Commercial Development Limited	Wholly-owned subsidiary	343,930	-	-		-	-
Grand Ocean Classic Commercial Group Co., Ltd	Quanzhou Grand Ocean Commercial Limited	Wholly-owned subsidiary	1,509,722	-	-		-	-
Grand Ocean Classic Commercial Group Co., Ltd	Fuzhou Grand Ocean Classic Commerce Limited	Wholly-owned subsidiary	1,528,448	-	-		-	-
Grand Ocean Classic Commercial Group Co., Ltd	Fuzhou Jiaruixing Business Administration Limited	Wholly-owned subsidiary	187,733	-	-		-	-
Grand Ocean Classic Commercial Group Co., Ltd	Fuzhou Grand Ocean Commercial Limited	Wholly-owned subsidiary	278,826	-	-		-	-
Grand Ocean Classic Commercial Group Co., Ltd	Shanghai Grand Ocean Qianshu Commercial Management Co., Ltd	Wholly-owned subsidiary	323,474	-	-		-	-
Grand Ocean Classic Commercial Group Co., Ltd	GRAND OCEAN RETAIL GROUP LTD.	The parent company	729,486	-	-		-	-
Fuzhou Grand Ocean Commercial Limited	Wuhan Grand Ocean Classic Commercial Development Limited	Wholly-owned subsidiary of Grand Ocean Classic Commercial Group Co., Ltd.	226,574	-	-		-	-
Nanjing Grand Ocean Classic Commercial Limited	Grand Ocean Classic Commercial Group Co., Ltd	Wholly-owned subsidiary of Grand Ocean Classic Commercial Group Co., Ltd.	2,517,698	-	-		-	-
Wuhan Grand Ocean Classic Commercial Development Limited	Shiyan Grand Ocean Commerce Limited	Wholly-owned subsidiary of Grand Ocean Classic Commercial Group Co., Ltd.	443,439	-	-		-	-
Wuhan Grand Ocean Classic Commercial Development Limited	Hengyang Grand Ocean Commercial Development Limited	Wholly-owned subsidiary of Grand Ocean Classic Commercial Group Co., Ltd.	190,231	-	-		-	-
Wuhan Grand Ocean Classic Commercial Development Limited	Wuhan Hanyang Grand Ocean Classic Commercial Limited	Wholly-owned subsidiary of Grand Ocean Classic Commercial Group Co., Ltd.	103,213	-	-		-	-
Yichang Grand Ocean Commerce Limited	Grand Ocean Classic Commercial Group Co., Ltd	Wholly-owned subsidiary of Grand Ocean Classic Commercial Group Co., Ltd.	1,038,542	-	-		-	-
Yichang Grand Ocean Commerce Limited	Wuhan Optics Valley Grand Ocean Commercial Development Limited	Wholly-owned subsidiary of Grand Ocean Classic Commercial Group Co., Ltd.	222,875	-	-		-	-
Hefei Grand Ocean Classic Commercial Development Limited	Grand Ocean Classic Commercial Group Co., Ltd	Wholly-owned subsidiary of Grand Ocean Classic Commercial Group Co., Ltd.	444,734	-	-		-	-
Wuhan Optics Valley Grand Ocean Commercial Development Limited	Grand Ocean Classic Commercial Group Co., Ltd	Wholly-owned subsidiary of Grand Ocean Classic Commercial Group Co., Ltd.	149,817	-	-		-	-
Wuhan Optics Valley Grand Ocean Commercial Development Limited	Wuhan Grand Ocean Classic Commercial Development Limited	Wholly-owned subsidiary of Grand Ocean Classic Commercial Group Co., Ltd.	141,725	-	-		-	-

-55-

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Notes to the Consolidated Financial Statements (Continued)

Table 5 The business relationship and significant transactions between the parent and subsidiaries
For the three months ended March 31, 2026

No.	Company name	Counter-party	Relationship	Transaction
				Accounts	Amount	Transaction terms	Percentage of consolidated net sales or total assets
1	Grand Citi Ltd.	GRAND OCEAN RETAIL GROUP LTD.	2	Other receivables - related parties	672,912	Mutually agreed	3.29%
1	Grand Citi Ltd.	Grand Ocean Classic Commercial Group Co., Ltd	1	Other receivables - related parties	230,231	Mutually agreed	1.13%
2	Grand Ocean Classic Commercial Group Co., Ltd	Hengyang Grand Ocean Commercial Development Limited	1	Other receivables - related parties	343,930	Mutually agreed	1.68%
2	Grand Ocean Classic Commercial Group Co., Ltd	Quanzhou Grand Ocean Commercial Limited	1	Other receivables - related parties	1,509,722	Mutually agreed	7.38%
2	Grand Ocean Classic Commercial Group Co., Ltd	Fuzhou Grand Ocean Classic Commerce Limited	1	Other receivables - related parties	1,528,448	Mutually agreed	7.47%
2	Grand Ocean Classic Commercial Group Co., Ltd	Fuzhou Jiaruixing Business Administration Limited	1	Other receivables - related parties	187,733	Mutually agreed	0.92%
2	Grand Ocean Classic Commercial Group Co., Ltd	Fuzhou Grand Ocean Commercial Limited	1	Other receivables - related parties	278,826	Mutually agreed	1.36%
2	Grand Ocean Classic Commercial Group Co., Ltd	Wuhan Grand Ocean Classic Commercial Development Limited	1	Other receivables - related parties	1,618	Mutually agreed	0.01%
2	Grand Ocean Classic Commercial Group Co., Ltd	Shanghai Grand Ocean Qianshu Commercial Management Co., Ltd	1	Other receivables - related parties	323,474	Mutually agreed	1.58%
2	Grand Ocean Classic Commercial Group Co., Ltd	GRAND OCEAN RETAIL GROUP LTD.	2	Other receivables - related parties	729,486	Mutually agreed	3.57%
3	Fuzhou Grand Ocean Commercial Limited	Fuzhou Jiaruixing Business Administration Limited	1	Other receivables - related parties	34,680	Mutually agreed	0.17%
3	Fuzhou Grand Ocean Commercial Limited	Wuhan Grand Ocean Classic Commercial Development Limited	1	Other receivables - related parties	226,574	Mutually agreed	1.11%
4	Nanjing Grand Ocean Classic Commercial Limited	Grand Ocean Classic Commercial Group Co., Ltd	2	Other receivables - related parties	2,517,698	Mutually agreed	12.31%
5	Wuhan Grand Ocean Classic Commercial Development Limited	Shiyan Grand Ocean Commerce Limited	1	Other receivables - related parties	443,439	Mutually agreed	2.17%
5	Wuhan Grand Ocean Classic Commercial Development Limited	Hengyang Grand Ocean Commercial Development Limited	1	Other receivables - related parties	190,231	Mutually agreed	0.93%
5	Wuhan Grand Ocean Classic Commercial Development Limited	Wuhan Hanyang Grand Ocean Classic Commercial Limited	1	Other receivables - related parties	103,213	Mutually agreed	0.50%
6	Yichang Grand Ocean Commerce Limited	Grand Ocean Classic Commercial Group Co., Ltd	2	Other receivables - related parties	1,038,542	Mutually agreed	5.08%
6	Yichang Grand Ocean Commerce Limited	Wuhan Grand Ocean Classic Commercial Development Limited	1	Other receivables - related parties	84,468	Mutually agreed	0.41%
6	Yichang Grand Ocean Commerce Limited	Wuhan Optics Valley Grand Ocean Commercial Development Limited	1	Other receivables - related parties	222,875	Mutually agreed	1.09%
7	Hefei Grand Ocean Classic Commercial Development Limited	Grand Ocean Classic Commercial Group Co., Ltd	2	Other receivables - related parties	444,734	Mutually agreed	2.17%
8	Shanghai Jingxuan Business Administration Limited	Grand Ocean Classic Commercial Group Co., Ltd	2	Other receivables - related parties	32,136	Mutually agreed	0.16%
9	Wuhan Optics Valley Grand Ocean Commercial Development Limited	Grand Ocean Classic Commercial Group Co., Ltd	2	Other receivables - related parties	149,817	Mutually agreed	0.73%
9	Wuhan Optics Valley Grand Ocean Commercial Development Limited	Wuhan Grand Ocean Classic Commercial Development Limited	1	Other receivables - related parties	141,725	Mutually agreed	0.69%

Note 1: The numbering system is as follows:

-57-

1.1. “0” represents the parent company.

Subsidiaries are numbered sequentially in Arabic numerals starting from “1” according to company classification.

Note 2: The types of relationships with counterparties are indicated as follows:

Parent company to subsidiary.
Subsidiary to parent company.
Subsidiary to subsidiary.

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GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Notes to the Consolidated Financial Statements (Continued)

Table 6 Information on investees (excluding investees in Mainland China)
Information on investees for the three months ended March 31, 2026

Investor Company	Investee Company	Location	Main business activities	Original investment amount		Balance as of March 31, 2026			Net income (losses) of the investee	Share of Profit/loss on investee	Note
				March 31, 2026	December 31, 2025	Shares	Percentage of ownership	Carrying amount
GRAND OCEAN RETAIL GROUP LTD.	Grand Citi Ltd.	Hong Kong	Primarily engaged in general investment activities	4,244,240	4,244,240	1,040,000,000	100.00%	6,965,684	(159,881)	(159,881)	Subsidiary
Grand Citi Ltd.	Sandmartin International Holdings Limited	Hong Kong	Media and entertainment platform-related industries	81,052	81,052	4,419,725	3.59%	-	-	-	Associate

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Notes to the Consolidated Financial Statements (Continued)

Table 7 Information on investment in Mainland China

The names of investees in Mainland China, the main business and other information:

Investee company	Main business	Total amount of paid-in capital	Method of investment	Accumulated outflow of investment from Taiwan as of January 1, 2026	Investment of flows		Accumulated outflow of investment from Taiwan as of March 31, 2026	Net income (loss) of the investee company	Percentage of ownership	Share of profits/losses
					outflow	inflow
Grand Ocean Classic Commercial Group Co., Ltd	Engaged in holding activities and the wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	3,930,362
(CNY 850,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(162,987)	100%	(162,987)	5,902,460	-
Nanjing Grand Ocean Classic Commercial Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	231,198
(CNY 50,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	11,147	100%	11,147	2,138,015	-
Fuzhou Grand Ocean Commercial Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	323,677
(CNY 70,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(66,272)	100%	(66,272)	1,660,468	-
Quanzhou Grand Ocean Commercial Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	92,479
(CNY 20,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(20,686)	100%	(20,686)	27,151	-
Wuhan Grand Ocean Classic Commercial Development Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	231,198
(CNY 50,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(43,087)	100%	(43,087)	1,650,433	-
Wuhan Optics Valley Grand Ocean Commercial Development Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	92,479
(CNY 20,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	11,285	100%	11,285	1,832,353	-
Wuhan Hanyang Grand Ocean Classic Commercial Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	323,677
(CNY 70,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(30)	100%	(30)	(193,248)	-

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Investee company	Main business	Total amount of paid-in capital	Method of investment	Accumulated outflow of investment from Taiwan as of January 1, 2026	Investment of flows		Accumulated outflow of investment from Taiwan as of March 31, 2026	Net income (loss) of the investee company	Percentage of ownership	Share of profits/losses
					outflow	inflow
Fuzhou Grand Ocean Classic Commerce Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	231,198
(CNY 50,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(30,486)	100%	(30,486)	(172,475)	-
Chongqing Optics Valley Grand Ocean Commercial Development Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	786,072
(CNY 170,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(47,736)	100%	(47,736)	-	-
Hengyang Grand Ocean Commercial Development Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	92,479
(CNY 20,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(15,742)	100%	(15,742)	(458,216)	-
Yichang Grand Ocean Commerce Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	92,479
(CNY 20,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	29,985	100%	29,985	564,978	-
Shanghai Jingxuan Business Administration Limited	Engaged in management consulting services, retail and wholesale of cosmetics, apparel and footwear, as well as e-commerce operations.	46,240
(CNY 10,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	-	100%	-	35,965	-
Hefei Grand Ocean Classic Commercial Development Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	92,479
(CNY 20,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	10,166	100%	10,166	311,596	-
Shiyan Grand Ocean Commerce Limited	Wholesale of cosmetics, apparel, footwear, accessories, packaging materials, food products, household appliances, communication equipment, and handicrafts.	92,479
(CNY 20,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(13,367)	100%	(13,367)	(343,396)	-
Fuzhou Jiaruixing Business Administration Limited	Engaged in management consulting services, retail and wholesale of cosmetics, apparel and footwear, as well as e-commerce operations.	23,120
(CNY 5,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	3,108	100%	3,108	(230,268)	-
Shanghai Grand Ocean Qianshu Commercial Management Co., Ltd	Engaged in management consulting services, retail and wholesale of cosmetics, apparel and footwear, as well as e-commerce operations.	231,198
(CNY 50,000)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(54,178)	100%	(54,178)	(858,833)	-

Investee company	Main business	Total amount of paid-in capital	Method of investment	Accumulated outflow of investment from Taiwan as of January 1, 2026	Investment of flows		Accumulated outflow of investment from Taiwan as of March 31, 2026	Net income (loss) of the investee company	Percentage of ownership	Share of profits/losses	Carrying amount as of March 31, 2026	Accumulated inward remittance of earnings as of March 31, 2026
					outflow	inflow
Fuzhou Grand Ocean Select Commercial Co., Ltd.	Engaged in management consulting services, retail and wholesale of cosmetics, apparel and footwear, as well as e-commerce operations.	6,936 (CNY 1,500)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(3,220)	100%	(3,220)	(3,034)	-
Grand Ocean Classic (Shanghai) Commercial Group Co., Ltd. (Note 4)	Engaged in management consulting services, retail and wholesale of cosmetics, apparel and footwear, as well as e-commerce operations.	- (CNY 0)	(2)	(Note 2)	(Note 2)	(Note 2)	(Note 2)	(1,746)	100%	(1,746)	(3,549)	-

Limitation on investment in Mainland China:

Accumulated investment in Mainland China as of March 31, 2026	Investment amounts authorized by investment commission, MOEA	Upper limit on investment
Note 2	Note 2	Note 2

Note 1: The methods for engaging in investment in Mainland China include the following:

(1)Direct investment in Mainland China.
(2)Indirect investment in Mainland China through companies registered in a third region (the Company invests through Grand Citi Ltd.).
(3)Others method.

Note 2: The Company is an offshore company and is not subject to the "Regulations Governing the Review of Investment or Technical Cooperation in Mainland China."

Note 3: Except for certain non-significant subsidiaries, for which investment gains or losses are recognized based on their self-prepared management accounts, the investment gains or losses of other investees are recognized based on financial statements reviewed by international accounting firms affiliated with accounting firms in the Republic of China through cooperative relationships.

Note 4: No capital contribution has been made yet.

Significant transactions:

Significant transactions between the Group and its investees in Mainland China, whether directly or indirectly, for the period from January 1 to March 31, 2026 (which have been eliminated in the preparation of the consolidated financial statements), are disclosed in the section "Information on significant transactions."

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Grand Ocean Retail Group Limited — Interim / Quarterly Report 2026

52497_rns_2026-06-29_b8625ad0-df5c-4591-b715-0f1f4577f557.pdf

GRAND OCEAN RETAIL GROUP LTD. AND SUBSIDIARIES

Consolidated Financial Statements

With Independent Auditors’ Review Report

Introduction

Scope of Review

Basis for Qualified Conclusion

Conclusion

Notice to Readers

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Balance Sheet

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Income Statement

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Income Statement

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Statement of Changes in Shareholders' Equity

For the three months ended March 31, 2026 and 2025

(Expressed in Thousands of New Taiwan Dollars)

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Statement of Changes in Shareholders' Equity

For the three months ended March 31, 2026 and 2025

(Expressed in Thousands of Chinese Yuan Renminbi)

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Statement of Cash Flows

For the three months ended March 31, 2026 and 2025

(Expressed in Thousands of New Taiwan Dollars)

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Consolidated Statement of Cash Flows

For the three months ended March 31, 2026 and 2025

(Expressed in Thousands of Chinese Yuan Renminbi)

4. Summary of significant accounting policies:

(1) Statement of compliance

(2) Basis of consolidation

A. Subsidiary Listed in Consolidated Financial Statements

A. Recognition of amortization

B. Goodwill

(11) Lease liabilities

A. Lease of land, housing and construction

B. Other leases

(12) Employee benefits

A. Defined contribution plans

(13) Income tax

A. Income tax expense

B. Deferred tax assets

(A) Recognized deferred tax assets and liabilities

B. Liquidity risks

C. Interest rate analysis

D. Other market price risk

7. Related-party transactions:

(1) Names and relationships with related parties

10. Losses due to major disasters: None

11. Subsequent events: None

12. Other

13. Other disclosures:

14. Segment information

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries Notes to the Consolidated Financial Statements (Continued)

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Notes to the Consolidated Financial Statements (Continued)

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Notes to the Consolidated Financial Statements (Continued)

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Notes to the Consolidated Financial Statements (Continued)

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Notes to the Consolidated Financial Statements (Continued)

GRAND OCEAN RETAIL GROUP LTD. and Subsidiaries

Notes to the Consolidated Financial Statements (Continued)

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Grand Ocean Retail Group Limited Interim / Quarterly Report 2026