FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) FIYTA Precision Technology Co. Ltd.2026 Interim Report August 21 2026 1FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Section I Important Notice Table of Contents and Definitions The Board of Directors Directors and Senior Executives of the Company guarantee that the contents of this Interim Report are true accurate and complete contain no false representations misleading statements or material omissions and accept individual and joint legal liability.Zhou Jinqun the person in charge of the Company Song Yaoming the Chief Financial Officer and Jiang Haiming the Head of Accounting Department (Accounting Supervisor) hereby declare that they guarantee the truthfulness accuracy and completeness of the financial report in this Interim Report.All Directors attended the Board meeting at which this Interim Report was considered.The forward-looking statements in this Interim Report concerning future plans development strategies etc. do not constitute any substantive commitment by the Company to investors. Investors are advised to be aware of the investment risks.The risk factors that the Company may face are described in detail in this report. Please refer to the content on the risks facing the Company and the corresponding countermeasures in Section III Management Discussion and Analysis.The Company does not plan to distribute cash dividends issue 2FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) bonus shares or convert capital reserve into share capital for the reporting period.This report is prepared in both Chinese and English. In the event of any discrepancy in the interpretation of this report the Chinese version shall prevail. 3FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Table of Contents Section I Important Notice Table of Contents and D....2 Section II Company Profile and Financial Highlight... 7 Section III Management Discussion and Analysis ......10 Section IV Corporate Governance Environmental and .. 19 Section V Significant Events ........................21 Section VI Changes in Shares and Shareholder Infor.. 30 Section VII Bonds ...................................36 Section VIII Financial Report .......................37 4FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Documents Available for Reference I. Financial statements signed and stamped by the Legal Representative Chief Financial Officer and Head of Accounting Department.II. Originals of all company documents and public announcements disclosed on media designated by the CSRC during the reporting period.III. The 2026 Interim Report (Full Text) signed by the Legal Representative. 5FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Definitions Defined Term Refers to Definition The Company Company FIYTA Refers to FIYTA Precision Technology Co. Ltd.AVIC Refers to Aviation Industry Corporation of China Ltd.AVIC Kechuang Refers to AVIC Science and Technology Innovation Co. Ltd.Shentian Technology Holding Refers to Shentian Technology Holding (Shenzhen) Co. Ltd.AVIC Finance Refers to AVIC Finance Co. Ltd.Hanhang Electromechanical Refers to Hanzhong Hanhang Electromechanical Co. Ltd.Changkong Gear Refers to Shaanxi Changkong Gear Co. Ltd.The reporting period reporting period Refers to January 1 2026 to June 30 2026 6FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Section II Company Profile and Financial Highlights I. Company Profile Stock Abbreviation FIYTA FIYTA B Stock Code 000026 200026 Stock abbreviation before change (if any) None Stock Exchange for Listing Shenzhen Stock Exchange Chinese Name of the Company FIYTA Precision Technology Co. Ltd.Chinese Abbreviation of the Company (if any) FIYTA English Name of the Company (if any) FIYTA Precision Technology Co. Ltd.English Abbreviation of the Company (if any) FIYTA Legal Representative of the Company Zhou Jinqun II. Contact Persons and Contact Information Board Secretary Securities Affairs Representative Name Song Yaoming Xiong Yaojia Contact 20th Floor FIYTA Technology Building Gaoxin 20th Floor FIYTA Technology Building Gaoxin Address South 1st Avenue Nanshan District Shenzhen South 1st Avenue Nanshan District Shenzhen Telephone 0755-86013669 0755-86013669 Fax 0755-83348369 0755-83348369 Email investor@fiyta.com.cn investor@fiyta.com.cn III. Other Information 1. Contact Information of the Company The registered address office address postal code website email address etc. of the Company remained unchanged during the reporting period. For details please refer to the 2025 Annual Report. 2. Information Disclosure and Place of Maintenance Stock exchange website for disclosing the Interim Report http://www.szse.cn Media names and websites for disclosing Securities Times Hong Kong Commercial Daily and Cninfo the Interim Report (www.cninfo.com.cn) Place where the Company's annual reports are kept for inspection Management Department of the Company (Board Office) 7FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 3. Other Relevant Information Whether other relevant information changed during the reporting period Not applicable IV. Key Accounting Data and Financial Highlights Whether the Company needs to retrospectively adjust or restate accounting data of previous years No The Reporting Period The Same Period of Increase/decrease of the Last Year reporting period over thesame period of last year Operating revenue (RMB) 1840480340.48 1784131937.23 3.16% Net profit attributable to shareholders of the listed company (RMB) 100504370.41 82445500.03 21.90% Net profit attributable to shareholders of the listed company after deducting 96839220.48 78377262.19 23.56% non-recurring profit or loss (RMB) Net cash flows from operating activities (RMB) 383972620.40 251490807.07 52.68% Basic earnings per share (RMB/share) 0.2477 0.2034 21.78% Diluted earnings per share (RMB/share) 0.2477 0.2034 21.78% Weighted average return on equity (ROE) 2.98% 2.41% 0.57% Increase/decrease at the End of the Reporting End of Last Year end of the reporting periodPeriod compared with the end of last year Total assets (RMB) 3731488593.54 3733401610.34 -0.05% Net assets attributable to shareholders of the listed company 3379593262.55 3336540162.45 1.29% (RMB) V. Differences in Accounting Data Under Domestic and Foreign Accounting Standards 1. Differences in net profit and net assets in financial reports disclosed simultaneously under IFRS and CAS Not applicable 2. Differences in net profit and net assets in financial reports disclosed simultaneously under foreign accounting standards and CAS Not applicable 8FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) VI. Non-recurring Profit or Loss Items and Amounts Unit: RMB Item Amount Description Gains and losses on disposal of non- current assets (including write-off of 474063.48 accrued asset impairment provisions) Government grants recognized in current profit or loss (excluding those closely related to the Company's normal operating business complying with national policies and 1916497.10 regulations enjoyed in accordance with established standards and having a continuing impact on the Company's profit or loss) Fair value change gains and losses arising from holding financial assets and financial liabilities by non- financial enterprises and gains and losses from disposal of financial 394557.22 assets and financial liabilities except for effective hedging activities related to the Company's normal business operations Reversal of impairment provision for receivables tested for impairment 1390273.53 individually Other non-operating income and expenses other than the above items 252866.81 Less: Income tax effect 763108.21 Total 3665149.93 Specific circumstances of other profit or loss items that meet the definition of non-recurring profit or loss: Not applicable Explanation of defining non-recurring profit or loss items listed in "Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Securities to the Public — Non-recurring Profit or Loss" as recurring profit or loss items Not applicable 9FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Section III Management Discussion and Analysis I. Principal Businesses of the Company During the Reporting Period (I) Principal Business Activities The Company ’ s founding and development are rooted in aviation precision technology and materials science.Guided by the mission of “carrying forward the spirit of ‘aviation serving the nation’ and creating a quality life” the Company has dedicated itself to the horology industry for many years. It has established a core business structure characterized by the synergy between its proprietary watch brands and comprehensive luxury watch services. The Company is committed to becoming a leader in China’s watch industry while promoting aviation culture and Chinese culture. In recent years leveraging its precision technology and industrial expertise and adhering to the principles of “ technology homology industrial synergy and value alignment ” the Company has strategically cultivated emerging businesses in precision technology and actively promoted technological innovation and business transformation.The Company has continuously built its capabilities in professional watchmaking and brand operations establishing a full industry chain covering research and development design manufacturing and sales. It owns proprietary watch brands such as “FIYTA” and “Emile Chouriet ” as well as the licensed brand “Beijing ” covering market segments ranging from mid-to-high-end and mass-market to fashion. The core brand “FIYTA” is positioned on the integration of “ aviation precision + oriental aesthetics ” adhering to the application of aviation technology and materials while incorporating oriental aesthetic design concepts to build a differentiated national brand.To capitalize on opportunities in the domestic luxury watch market the Company launched “ Harmony ” a comprehensive service channel for luxury timepieces. Harmony specializes in the distribution and servicing of world- renowned watches and has established close partnerships with numerous high-end and mainstream luxury watch brands. Committed to becoming “ the premier comprehensive service provider for luxury watches ” Harmony has become one of the leading high-end professional watch retail chains in China distinguished by its solid operational management customer service capabilities and best practices adopted from leading international brand operations.To seize opportunities in emerging industries the Company has increased investments in precision technology capabilities. It has gradually developed comprehensive capabilities in the design development and manufacturing of precision components. While consolidating its existing businesses in lasers and optical communications the Company is strategically targeting key sectors such as robotics to accelerate the development of its emerging business portfolio.(II) Industry Overview In the first half of 2026 China ’s total retail sales of consumer goods increased by 1.3% year-on-year with the share of service consumption continuing to rise and structural divergence in consumption upgrades becoming more pronounced. The domestic watch consumption industry in which the Company operates remained under pressure due to weak consumer demand. According to data from the Federation of the Swiss Watch Industry the total value of Swiss watch exports to mainland China decreased by 5.0% year-on-year from January to June.Meanwhile the high-tech manufacturing sector— toward which the Company is transforming—has maintained robust growth. According to the National Bureau of Statistics the value-added output of large-scale high-tech manufacturing enterprises increased by 13.3% year-on-year in the first half of the year. The rapid development of artificial intelligence-related industries has driven up demand across industrial chains such as robot reducers with the output of robot reducers surging by 57.3% year-on-year during the January–June period. 10FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 2、Core Competitiveness Analysis (I) End-to-End Brand Operation and Management Capabilities Across the Entire Industrial Chain The Company possesses fully integrated operational management capabilities spanning R&D design manufacturing sales and service. Through resource integration and business synergy it continuously reinforces the differentiated brand identity and market competitiveness of its core proprietary brand "FIYTA". During the reporting period the "FIYTA" brand was awarded the title of "Pioneer Brand" for FY2026 by Tmall and named "Consumers' Favorite Brand of 2025" by JD.com.(II) Omnichannel Refined Operational Management Capabilities The Company boasts refined channel operational capabilities. By pursuing high-quality development of offline channels and steadily advancing online-offline integration channel structure has been continuously optimized and operational efficiency has steadily improved. It has established a multi-dimensional channel network covering both online and offline channels across domestic and overseas markets.(III) Core Technical Capabilities in Precision Technology As a National Demonstration Enterprise for Technological Innovation the Company hosts a National Corporate Technology Center and a National Industrial Design Center. Leveraging its expertise in watch movements and aerospace timing equipment it has developed micron-level ultra-precision manufacturing processes and possesses strong capabilities in small-size high-precision component manufacturing and solution provision. The Company has also achieved independent R&D and mass production capabilities for medium- and small-modulus gears and precision reducers. Its core products are primarily applied in robotics lasers optical communications aerospace and other advanced industrial sectors.(IV) High-Efficiency Digitalized Operational Management Capabilities The Company possesses diversified digital retail systems and digital management platforms that empower operations and employees. By continuously deepening digital applications across management manufacturing sales and customer service it fosters cross-business synergies and enhances operational efficiency.(V)Professional Talent Pool Building Capabilities Based on the philosophy of "Value Creation" the Company continuously invests in workforce building maintaining a sound talent selection cultivation and promotion system as well as a professional and stable talent pool. Through innovative incentive mechanisms and diverse incentive tools it has fostered numerous industry-leading professionals in core areas such as design R&D and manufacturing. 3. Analysis of Principal Businesses Overview In the first half of 2026 situated in a pivotal phase of transformation and upgrading the Company focused on talent development precision manufacturing and digitalization continuously enhanced organizational capabilities deepened its core watch business and accelerated strategic layout in emerging industries. During the reporting period the Company achieved operating revenue of RMB 1840.4803 million up 3.16% year-on-year; total profit was RMB 131.6645 million up 24.73% year-on-year. Meanwhile the Company deepened structural adjustments strengthened risk control and steadily improved operational efficiency with inventory balance decreasing by RMB 265.4821 million from the end of last year.During the reporting period the Company's primary operational initiatives were as follows: (I)Consolidating the fundamentals of the watch business optimizing business structure and enhancing operating quality and efficiency 11FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) "FIYTA" defined its brand positioning as "Aviation Precision + Oriental Aesthetics" continually cultivating brand differentiation. It optimized product structure enhanced innovative product design launched new product series such as "Chinese Ginkgo" and "Oriental Beauty" and steadily advanced product and brand rejuvenation. It optimized store portfolio focusing on increasing store productivity of flagship offline stores strictly managing ROI online and strengthening refined operations. It executed integrated marketing campaigns hosting nationwide dual-theme roadshows featuring Aviation Precision and Oriental Aesthetics celebrity events and Ru porcelain cultural crossover IP collaborations enhancing omnichannel brand influence."Harmony" focused deeply on top-tier brands and prime channels practiced lean operations and tightened inventory risk control achieving substantial improvements in inventory turnover and asset efficiency. By deepening customer service the Company achieved a marked increase in repeat purchase volume from existing customers further strengthening customer loyalty.(II) Accelerating the Development of Emerging Businesses Increasing Key Investments and Building Core Capabilities Building on its existing precision technology business the Company is focusing on emerging sectors such as robotics pursuing a premium high-impact strategy. It is establishing a core talent pipeline and dedicated product lines for precision manufacturing and robotics to solidify its capability foundation. By strengthening internal and external resource coordination the Company is prioritizing the development of core products and key customer accounts to secure an early-mover advantage in its business layout. As of the disclosure date the Company has completed the 100% equity acquisition of Changkong Gear. It is steadily advancing deep integration and business empowerment leveraging Changkong Gear’s technological expertise and product strengths in precision gears and precision reducers to accelerate the development of its robotics business.(III) Comprehensively Strengthening Organizational Capabilities Building a High-Caliber Talent Pool and Enhancing Management Effectiveness The Company adheres to a talent- and management-driven approach to improve business quality and efficiency.Aligning with its business development strategy it has refined its systems for talent acquisition integration and development bringing in specialized professionals for key roles in R&D production process engineering and marketing. The Company has improved its closed-loop management mechanism covering strategic formulation decomposition and performance evaluation to ensure the effective execution of strategic objectives. It is advancing integrated control and functional support functions while deepening the integration of business and finance operations.Additionally digital transformation initiatives in production and operations are being implemented to enhance overall operational efficiency.Year-on-Year Changes in Major Financial Data Unit: RMB The Reporting The Same Period YoY Period of Last Year change Reason for change Operating revenue 1840480340.48 1784131937.23 3.16% Not applicable Operating costs 1196202821.77 1149808611.57 4.03% Not applicable Selling expenses 360654255.33 392808032.65 -8.19% Not applicable Administrative expenses 95354788.74 89971510.01 5.98% Not applicable Mainly due to the decrease in interest on borrowings and Financial expenses 3035440.88 5640080.29 -46.18% the impact of foreign exchange gains during the reporting period. 12FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Mainly due to the increase in Income tax expense 31160140.78 23115165.73 34.80% total profit during the reporting period.R&D investment 40717396.64 33087871.33 23.06% Not applicable Mainly due to the increase in Net cash flows from operating sales receipts and the activities 383972620.40 251490807.07 52.68% decrease in inventorypurchases during the reporting period.Mainly due to the payment for Net cash flows from investing equity acquisition and the activities -261963522.13 -40364724.39 -548.99% impact of time depositactivities during the reporting period.Mainly due to the year-on- Net cash flows from financing activities -94859977.01 -191150697.48 50.37% year decrease in cash dividend distribution during the reporting period.Net increase in cash and cash equivalents 26541299.16 20352756.48 30.41% Mainly due to the combined effect of the above factors.Significant changes in the Company's profit composition or profit sources during the reporting period Not applicable Composition of Operating Revenue Unit: RMB The Reporting Period The Same Period of Last Year Proportion of Proportion of YoY Amount Operating Amount Operating change Revenue Revenue Total operating revenue 1840480340.48 100% 1784131937.23 100% 3.16% By Industry Watch business 1691696415.16 91.92% 1659610629.02 93.02% 1.93% Precision technology 79085973.27 4.30% 60465539.30 3.39% 30.80% business Leasing business 52916447.44 2.88% 57835071.51 3.24% -8.50% Other 16781504.61 0.90% 6220697.40 0.35% 169.77% By Product Watch brand business 252452120.62 13.72% 315109112.17 17.66% -19.88% Comprehensive luxury watch 1439244294.54 78.20% 1344501516.85 75.36% 7.05% service business Precision technology 79085973.27 4.30% 60465539.30 3.39% 30.80% business Leasing business 52916447.44 2.88% 57835071.51 3.24% -8.50% Other 16781504.61 0.90% 6220697.40 0.35% 169.77% By Region South China 846839128.62 46.01% 806381444.29 45.20% 5.02% Northwest China 255622443.68 13.89% 248784340.56 13.94% 2.75% North China 67720684.71 3.68% 51669800.71 2.90% 31.06% East China 152531098.84 8.29% 228872072.10 12.83% -33.36% Northeast China 181784914.65 9.88% 162388661.36 9.10% 11.94% Southwest China 335982069.98 18.25% 286035618.21 16.03% 17.46% 13FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Industries products or regions accounting for over 10% of the Company's operating revenue or operating profit Unit: RMB Operating Gross YoY change inOperating costs profit operating YoY change in YoY change revenue margin revenue operating costs in gross profit margin By Industry Watch business 1691696415.16 1103017338.82 34.80% 1.93% 2.35% -0.27% Leasing business 52916447.44 16753851.32 68.34% -8.50% 0.56% -2.85% By Product Watch brand business 252452120.62 70365782.78 72.13% -19.88% -27.51% 2.93% Comprehensive luxury watch service 1439244294.54 1032651556.04 28.25% 7.05% 5.31% 1.19% business Leasing business 52916447.44 16753851.32 68.34% -8.50% 0.56% -2.85% By Region South China 846839128.62 546188552.47 35.50% 5.02% 7.77% -1.65% Northwest China 255622443.68 165765219.64 35.15% 2.75% 3.70% -0.60% North China 67720684.71 41875442.33 38.16% 31.06% 40.74% -4.25% East China 152531098.84 94900877.97 37.78% -33.36% -38.28% 4.97% Northeast China 181784914.65 127934009.81 29.62% 11.94% 12.59% -0.40% Southwest China 335982069.98 219538719.55 34.66% 17.46% 18.04% -0.32% If the statistical scope of the Company's principal business data was adjusted during the reporting period the Company's principal business data for the most recent period adjusted according to the scope at the end of the reporting period Not applicable 4. Analysis of Non-Principal Businesses Not applicable V. Analysis of Assets and Liabilities 1. Significant Changes in Asset Composition Unit: RMB End of the Reporting Period End of last year Change Significant Proportion of in changeAmount total assets Amount Proportion of total assets proportion Description Cash and cash 657780338.81 17.63% 631239039.65 16.91% 0.72% Not equivalents applicable Accounts receivable 264290477.99 7.08% 249868540.94 6.69% 0.39% Not applicable Contract 0.00 0.00% 0.00 0.00% 0.00% Not 14FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) End of the Reporting Period End of last year Change Significant Amount Proportion of Proportion of in change total assets Amount total assets proportion Description assets applicable Inventories 1462500282.14 39.19% 1727982404.66 46.28% -7.09% Notapplicable Investment properties 301443999.00 8.08% 308270580.37 8.26% -0.18% Not applicable Long-term equity 46672153.60 1.25% 46436556.86 1.24% 0.01% Not investments applicable Fixed assets 337417287.88 9.04% 343353998.15 9.20% -0.16% Notapplicable Construction in progress 0.00 0.00% 0.00 0.00% 0.00% Not applicable Right-of-use 62048131.85 1.66% 72791092.06 1.95% -0.29% Notassets applicable Short-term borrowings 0.00 0.00% 0.00 0.00% 0.00% Not applicable Contract liabilities 18121608.21 0.49% 16450934.50 0.44% 0.05% Not applicable Long-term Not borrowings 0.00 0.00% 0.00 0.00% 0.00% applicable Lease liabilities 14736464.18 0.39% 17892390.31 0.48% -0.09% Not applicable 2. Major Overseas Assets Not applicable 3. Assets and Liabilities Measured at Fair Value Not applicable 4. Restricted Asset Rights as of the End of the Reporting Period Not applicable VI. Investment Analysis 1. Overview Investment amount in the reporting Investment amount in the same period (RMB) period of last year (RMB) Change rate 0.000.000.00% 2. Significant Equity Investments Acquired During the Reporting Period Not applicable 15FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 3. Significant Non-Equity Investments in Progress During the Reporting Period Not applicable 4. Financial Asset Investments (1) Securities Investments Not applicable (2) Derivative Investments Not applicable 5. Use of Proceeds Not applicable VII. Material Asset and Equity Sales 1. Material Asset Sales Not applicable 2. Material Equity Sales Not applicable VIII. Analysis of Major Subsidiaries and Investees Major subsidiaries and investees with an impact of 10% or more on the Company's net profit Unit: RMB Company Company Principal Registere Total name type business d capital assets Net assets Operating Operating revenue profit Net profit Shenzhen Purchase Harmony and sale of World Subsidiar watchesand spare 6000000 1510748 1036048 1401274 1455040 1086096Watch y 00.00 441.66 068.31 553.21 94.51 08.49 Center parts; Co. Ltd. maintenance services.Shenzhen Manufactur FIYTA ing and Precision Subsidiar production 1800000 2901817 2104169 1179882 -- Technolog y of watches 00.00 12.22 98.96 63.07 16327031153890 0.046.53 y Co. Ltd. and spareparts.Shenzhen Production FIYTA Subsidiar and 5000000 1979183 1676909 7605265 - - Technolog y processing 0.00 81.84 88.10 4.71 1385197. 472770.6 y of precision 59 1 16FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Developm component ent Co. s.Ltd.FIYTA Sale of Sales Co. Subsidiar watches 4500000 4288461 3224167 1629924 3886286. 2966844.Ltd. y and spare 00.00 56.44 03.75 57.28 13 34parts.Acquisition and Disposal of Subsidiaries During the Reporting Period Not applicable Description of Major Subsidiaries and Investees 1. Net profit of Shenzhen Harmony World Watch Center Co. Ltd. increased by RMB 41674794.50 year-on-year mainly due to the growth in luxury watch sales revenue and the reduction in period expenses during the reporting period.IX. Structured Entities Controlled by the Company Not applicable X．Risks Facing the Company and Countermeasures 1. Consumer Market Risk Currently the Company faces market risks arising from softened demand in the domestic traditional watch consumer market. The Company will continue to build differentiated proprietary brands optimize brand product and channel structures adhere to customer-oriented strategies consolidate refined operations and customer services and enhance customer recognition. Concurrently it will increase resource allocation and capability development in emerging industries driving strategic transformation upgrading and business growth. 2. Core Technology Risk Currently the Company faces technological challenges across multiple fields including traditional watchmaking emerging industries and digital applications. In response the Company will increase investment in core technical talent and digitalization strengthening frontier technological breakthroughs and practical applications in proprietary movement R&D key component manufacturing specialized precision manufacturing lines and digital factory construction thereby driving technological innovation and business growth.XI. Formulation and Implementation of Market Value Management System and Valuation Enhancement Plan Whether the Company has formulated a market value management system.Yes Whether the Company has disclosed a valuation enhancement plan.No The 13th meeting of the 11th Board of Directors held on January 29 2026 reviewed and approved the "Proposal on Formulating the Company's ". To strengthen market value management promote the enhancement of investment value and boost investor returns the Company formulated the "Market Value Management System" in accordance with regulations such as the "Regulatory Guidelines for Listed Companies No. 10 — Market Value Management". For details please refer to the full text of the system disclosed on Cninfo on January 312026. 17FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) XII. Implementation of the Action Plan for "Dual Enhancement of Quality and Return" Whether the Company has disclosed the announcement on the Action Plan for "Dual Enhancement of Quality and Return".No 18FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Section IV Corporate Governance Environmental and Social Responsibilities I. Changes in Directors and Senior Executives of the Company Name PositionHeld Type Date Reason Huang Electe Kai Director d May 20 2026 Elected as a non-independent director of the 11th Board of Directors by the 2025 Annual General Meeting.Chen Independe Electe Elected as an independent director of the 11th Board of Han nt Director d July 10 2026 Directors by the First Extraordinary General Meeting of 2026.Zhang Deputy Haohai General Appoin ted June 22 2026 Appointed as Deputy General Manager at the 17th meeting of Manager the 11th Board of Directors.Song Deputy Yongk General Appointed June 22 2026 Appointed as Deputy General Manager at the 17th meeting of ang Manager the 11th Board of Directors.Yuan General Appoin Tianbo Counsel ted June 22 2026 Appointed as General Counsel at the 17th meeting of the 11th Board of Directors.Director Pan Bo and ResignGeneral ed June 22 2026 Resigned from the positions of Director of the 11th Board of Directors and General Manager due to work reasons.Manager Li Director Resign March 12 2026 Resigned from the position of Director of the 11th Board ofPeiyin ed Directors due to work reasons.Wang Sushe Independe Resign July 10 2026 Resigned from the position of Director of the 11th Board of ng nt Director ed Directors due to work reasons.Lu Wanju General Resign June 22 2026 Resigned from the position of General Counsel due to work n Counsel ed reasons.Tang Deputy Haiyua General Resign March 27 2026 Resigned from the position of Deputy General Manager due to n Manager ed personal reasons.II. Profit Distribution and Conversion of Capital Reserve into Share Capital During the Reporting Period The Company does not plan to distribute cash dividends issue bonus shares or convert capital reserve into share capital for the reporting period.III. Implementation of Equity Incentive Plans Employee Stock Ownership Plans or Other Employee Incentive Measures Not applicable IV. Environmental Information Disclosure Whether the listed company and its major subsidiaries are included in the list of enterprises subject to mandatory 19FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) disclosure of environmental information No V. Social Responsibility The Company has actively fulfilled its corporate social responsibilities over the years. For details on recent developments please refer to the "2025 Environmental Social and Governance (ESG) Report" disclosed on Cninfo (www.cninfo.com.cn) on March 14 2026. 20FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Section V Significant Events I. Commitments Completed During the Reporting Period and Overdue Commitments as of the End of the Reporting Period by De Facto Controllers Shareholders Related Parties Acquirers the Company and Other Related Parties Not applicable II. Non-Operating Capital Occupation by Controlling Shareholders and Other Related Parties Not applicable III. Non-Compliant External Guarantees Not applicable IV. Appointment and Dismissal of Accounting Firm Whether the interim financial report has been audited No V. Explanations of the Board of Directors on the "Non-Standard Audit Report" Issued by the Accounting Firm for the Reporting Period Not applicable VI. Explanations of the Board of Directors on Matters Related to the "Non-Standard Audit Report" of the Previous Year Not applicable VII. Matters Related to Bankruptcy Reorganization Not applicable VIII. Litigation Matters Material Litigation and Arbitration Not applicable Other Litigation Matters Not applicable 21FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) IX. Penalties and Rectifications Not applicable X. Integrity Status of the Company and Its Controlling Shareholder and De Facto Controller Not applicable XI. Material Related-Party Transactions 1. Related-Party Transactions Related to Daily Operations Not applicable 2. Related-Party Transactions from Asset or Equity Acquisition and Disposal Carryin Apprai Gai Settle n/lo Type g sed mentvalue ssRelat of Conten amount Transf meth on ed- relat t of Pricing principle of of er od of tran Discl Relate party ed- related transfeof related-party transfer price relate sact osur Disclosud Party relati party -party rred onshi trans transa transaction red (RMB d- e re index assets assets ion 10000 party date p actio ction ) trans (RM n (RMB (RMB actio B 10000) 10000) n 10000) The The transactionAVIC Compa price wasis the ny determinedCom intends based on the https://w pany' appraised net ww.cninf s de to asset value of o.com.c facto acquir Changkong n/new/di contr e a sclosure/ oller 100% Gear as of the detailpl and equity evaluation ate=szs AVIC interes benchmark date e&orgId Hanha Hanhang Equit t in of December 31 ng y Chang 2025 (RMB April =gssz00 Electro Electr acqui kong 339.6904 27279. 33969 32479 Cash 0 30 00026&s omec million) as set 79 .04 .04 2026 tockCodmecha hanic sition Gearnical held out in the Asset e=00002 al is 6&annou a jointly Valuation by Report (Zhong ncement contr AVIC Tong Hua Ping Id=1225 olled and Bao Zi [2026] 262620& subsi Hanha No. 020289) announc diary issued by ementTi of ng me=202 AVIC Electro Beijing mecha Zhongtonghua 6-04-30. nical. AssetsAppraisal Co. 22FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Ltd. and filed with the state- owned assets supervision authority. After deducting the Shaanxi Provincial state- owned exclusive capital reserve of RMB 14.90 million the 100% equity valuation of Changkong Gear was fixed at RMB 324.7904 million.Reasons for significant differences between transfer price and book value or Not applicable.appraised value (if any) Impact on the Company's This transaction constitutes a business combination under common control and will Operating Results and Financial not change the accounting treatment of Changkong Gear. Upon completion of the Position transaction Changkong Gear becomes a wholly-owned subsidiary of the Companyand is included in the consolidated financial statements.Performance fulfillment during the reporting period if performance commitments are Not applicable.involved Note: As of June 30 2026 the acquisition of 100% equity in Changkong Gear had not been completed. On July 14 2026 the Company completed the acquisition of 100% equity in Changkong Gear. Changkong Gear completed the industrial and commercial registration of changes for the equity transfer and obtained the "Business License" issued by the Administrative Approval Service Bureau of Nanzheng District Hanzhong City. For details please refer to the "Announcement on the Completion of Industrial and Commercial Registration of Changes for the Acquisition of 100% Equity in Shaanxi Changkong Gear Co. Ltd. and Related-Party Transaction 2026-033" disclosed on Cninfo (www.cninfo.com.cn) on July 15 2026. 3. Related-Party Transactions of Joint External Investment Not applicable 4. Related-Party Claims and Debts Not applicable 5. Transactions with Associated Finance Companies Deposit Business Related- Maximum Beginning Amount incurred in current party Deposit Ending Related Party daily period relationshi interest rate balance balance deposit limit p range (RMB Total Total (RMB (RMB 10000) deposit withdrawal 10000) 23FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 10000) amount in amount in current current period period (RMB (RMB 10000)10000) Under control of AVIC Finance the same 100000 0.15%-0.85% 55255 286888 279573 62570ultimate party Loan Business Amount incurred in current period Related- Total party Loan credit Loan Beginning Total loan Ending Related Party balance amount in repayment balance relationshi line (RMB interest rate10000) range (RMB current amount in (RMB p 10000) period current 10000) (RMB period 10000) (RMB10000) Under AVIC control of Not higher Finance the same 80000 than the 1- 0 0 0 0ultimate year LPR party Credit Facility or Other Financial Services During the reporting period the maximum daily balance of deposits and loans between the Company and AVIC Finance did not exceed the limits specified in the Financial Services Agreement. No credit facilities or other financial business occurred. Concurrently the Company issues an interim "Risk Continuous Assessment Report on Related- Party Deposits and Loans with AVIC Finance Co. Ltd.". 6. Transactions Between Finance Companies Controlled by the Company and Related Parties Not applicable 7. Other Significant Related-Party Transactions The 14th meeting of the 11th Board of Directors held on March 12 2026 and the 16th meeting of the 11th Board of Directors held on April 29 2026 respectively reviewed and approved the "Proposal on the Expected Daily Related- Party Transactions for 2026" and the "Proposal on Increasing the Expected Daily Related-Party Transactions for 2026".The above proposals were approved at the 2025 Annual General Meeting held on May 20 2026. During the reporting period the cumulative transaction amounts of various related-party transactions associated with daily operations were within the estimated annual limits.Relevant Inquiries on Websites Disclosing Temporary Reports on Significant Related-Party Transactions Disclosure Date of Title of Temporary Announcement Temporary Website for Disclosing Temporary Announcement Announcement Announcement on Resolutions of the 14th Meeting of the 11th Board of Directors 2026-002 March 14 2026 http://www.cninfo.com.cn/ Announcement on Expected Daily Related-Party Transactions for 2026 2026-009 March 14 2026 http://www.cninfo.com.cn/ Announcement on Resolutions of the 16th Meeting of the 11th Board of Directors 2026-016 April 30 2026 http://www.cninfo.com.cn/ 24FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Announcement on Increasing the Expected Daily Related-Party Transactions for 2026 2026-018 April 30 2026 http://www.cninfo.com.cn/ Announcement on Resolutions of 2025 Annual General Meeting 2026-024 May 21 2026 http://www.cninfo.com.cn/ XII. Material Contracts and Their Performance 1. Custody Contracting and Leasing Matters (1) Custody Not applicable (2) Contracting Not applicable (3) Leasing Not applicable 2. Material Guarantees Unit: RMB 10000 External Guarantees of the Company and Its Subsidiaries (Excluding Guarantees for Subsidiaries) Disclos ure Name date of Whethe of announ Actual Actual Counter Whethe Collater - Guarant r r it is a guarant cement Guarant occurre guarant Guarant related- eed on ee limit nce ee ee type al (if guarant ee fulfilled guarant date amount any) ee (if period complet party party any) ely guarantee ee credit line Not applicable Total approved Total actual external guarantee amount of external limit during the 0 guarantees during 0 reporting period the reporting (A1) period (A2) Total approved Total actual external guarantee balance of external limit at the end of 0 guarantees at the 0 the reporting end of the period (A3) reporting period(A4) Guarantees Provided by the Company to Subsidiaries Name Disclos Guarant Actual Actual Guarant of ure occurre guarant Collater Counter Whethe Whethe ee limit ee type al (if - Guarant ee r r it is aguarant date of nce ee guarant fulfilled related- 25FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) eed announ date amount any) ee (if period complet party party cement any) ely guarant on ee guarant ee credit line Shenzh Counter en Joint - Harmon and guarant y World March Decem several ee One Watch 14 30000 ber 30 9000 liability provide No No Center 2025 2025 guarant d by the year Co. ee guarant Ltd. eedparty Total approved Total actual guarantee limit for guarantee amount subsidiaries during 30000 for subsidiaries 0 the reporting during the period (B1) reporting period(B2) Total approved Total actual guarantee limit for guarantee balance subsidiaries at the for subsidiaries at end of the 30000 the end of the 9000 reporting period reporting period (B3) (B4) Guarantees Provided by Subsidiaries to Subsidiaries Disclos ure Name date of Whethe of announ Actual Actual Counter Whethe r it is a guarant cement Guarant occurre guarant Guarant Collater - Guarant r on ee limit nce ee ee type al (if guarant ee fulfilled related- eed guarant date amount any) ee (if period complet party party any) ely guarantee ee credit line Not applicable Total approved Total actual guarantee limit for guarantee amount subsidiaries during 0 for subsidiaries the reporting during the 0 period (C1) reporting period(C2) Total approved Total actual guarantee limit for guarantee balance subsidiaries at the for subsidiaries at end of the 0 the end of the 0 reporting period reporting period (C3) (C4) Total Guarantee Amount of the Company (Total of the First Three Items) Total approved 30000 Total actual 0 guarantee limit guarantee amount 26FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) during the during the reporting period reporting period (A1+B1+C1) (A2+B2+C2) Total approved Total actual guarantee limit at guarantee balance the end of the 30000 at the end of the 9000 reporting period reporting period (A3+B3+C3) (A4+B4+C4) Proportion of total actual guarantee amount (A4+B4+C4) to the Company's 2.66% net assets Including: Balance of guarantees provided to shareholders de facto controller and 0 related parties (D) Balance of debt guarantees provided directly or indirectly to guaranteed entities with an asset-liability ratio 0 exceeding 70% (E) Amount of total guarantees exceeding 50% of net assets (F) 0 Total amount of the above three guarantee items (D+E+F) 0 Explanations on guarantee liabilities incurred during the reporting period or evidence indicating possible joint and Not applicable several repayment liabilities for unexpired guarantee contracts (if any) Explanation of non-compliant external guarantees (if any) Not applicable Specific explanations on combined guarantees Not applicable 3. Entrusted Wealth Management Not applicable 4. Other Material Contracts Not applicable XIII. Registration Form of Research Communication Interviews and Other Activities During the Reporting Period Main Topics Basic Receptio Reception Receptio Type of n Date Location n Method Visitors Visitors Discussed and Information Materials Index of Provided Research January Conferenc On-site Instituti Changan Fund Management Co. Company https://irm.cni 9 2026 e Room research on Ltd. Orient Securities Co. Ltd. operations nfo.com.cn/ircFIYTA Cinda Australasia Fund development s/searchkey 27FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Technolo Management Co. Ltd. Essence plans word=000026 gy Fund Management Co. Ltd. First acquisition Building Seafront Fund Management Co. project Ltd. China Fortune Securities progress etc.Co. Ltd. Hongming Capital.Conferenc Guotai Haitong Securities Co. Company e Room Ltd. East Money Securities Co. operations https://irm.cni January FIYTA On-site Instituti Ltd. First Capital Securities Co. development nfo.com.cn/irc 22 2026 Technolo research on Ltd. Shenzhen Mawang plans gy Investment Group Co. Ltd. acquisition s/searchkey Building Ruizhi Fund. project word=000026 progress etc.Online Companyoperations March https://ese communi https://irm.cni b.cn/1wu0 cation Investors participating remotely development 25 2026 via Other online in the Company's 2025 plans nfo.com.cn/irc ClV7w9q network Online Performance Briefing. acquisition s/searchkey word=000026 platform projectprogress etc.Conferenc Company e Room Huisheng Fund Management Co. operations https://irm.cni April 3 FIYTA On-site Instituti Ltd. Zhongtian Securities Co. development 2026 Technolo research on Ltd. Shenzhen Chuanghua plans nfo.com.cn/irc acquisition s/searchkeygy Investment Consulting Co. Ltd. project word=000026Building progress etc.Guosen Securities Co. Ltd.Huachuang Securities Co. Ltd.Ping An Asset Management Co.Ltd. GF Securities Co. Ltd.Orient Securities Co. Ltd.Penghua Fund Management Co.Ltd. Western Securities Co. Ltd.Huaxi Securities Co. Ltd.Sealand Securities Co. Ltd.Caitong Securities Co. Ltd.Zheshang Securities Co. Ltd.Rongtong Fund Management Co.Ltd. Shanxi Securities Co. Ltd.Conferenc Tianfeng Securities Co. Ltd. Company e Room Shenwan Hongyuan Securities operations https://irm.cni May 28 FIYTA On-site Instituti Co. Ltd. Xinjiang Qianhai United developmentplans nfo.com.cn/irc2026 Technolo research on Fund Management Co. Ltd. s/searchkey gy Kaiyuan Securities Asset acquisition word=000026 Building Management Co. Ltd. Quango project Fund Management Co. Ltd. progress etc.Shenzhen Hengbang Zhaofeng Asset Management Co. Ltd.Shenzhen Gaoshengxin Private Securities Fund Management Co. Ltd. Shenzhen Qianrong Private Securities Investment Fund Co. Ltd. Shenzhen Kangruitong Investment Management Co. Ltd.Guangzhou Xinmiao Private Securities Investment Fund Management Co. Ltd. Shenzhen 28FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Huaqi Capital Partnership (Limited Partnership) Hainan Daohe Private Equity Fund Management Co. Ltd.XIV. Description of Other Material Events Not applicable XV. Material Events of Subsidiaries Not applicable 29FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Section VI Changes in Shares and Shareholder Information I. Changes in Shares 1. Statement of Changes in Shares Unit: Share Before the change Increase/decrease (+ -) After the change Issu Conver anc Bon sion of Quantity Proporti e us capital on sha reserv Other Subtotal Quantity Proportio New n shar res e into es shares I.Restricted 622340 0.15% 0 0 0 122914 122914 745254 0.18% shares 1. State- owned 0 0.00% 0 0 0 0 0 0 0.00% shares 2. State- owned legal 0 0.00% 0 0 0 0 0 0 0.00% person shares 3. Other domestic 622340 0.15% 0 0 0 122914 122914 745254 0.18% shares Includ ing: Domestic legal 0 0.00% 0 0 0 0 0 0 0.00% person shares Dome stic natural 622340 0.15% 0 0 0 122914 122914 745254 0.18% person shares 4. Foreign 0 0.00% 0 0 0 0 0 0 0.00% shares Includ ing: Foreign legal 0 0.00% 0 0 0 0 0 0 0.00% person shares 30FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Forei gn natural person 0 0.00% 0 0 0 0 0 0 0.00% shares II.Unrestrict 405141667 99.85% 0 0 0 -122914 -122914 405018753 99.82% ed shares 1. RMB ordinary shares (A 364560733 89.85% 0 0 0 -122914 -122914 364437819 89.82% shares) 2. Domestic ally listed foreign 40580934 10.00% 0 0 0 0 0 40580934 10.00% shares (B shares) 3. Overseas listed 0 0.00% 0 0 0 0 0 0 0.00% foreign shares 4. Other 0 0.00% 0 0 0 0 0 0 0.00% III. Total number of 405764007 100.00% 0 0 0 0 0 405764007 100.00%shares Reason for share changes During the reporting period due to adjustments in transferable quotas for outgoing executives restricted shares increased by 122914 shares (with a corresponding decrease in unrestricted shares) while the Company's total share capital remained unchanged.Approval of share changes Not applicable Transfer of share changes Not applicable Implementation progress of share repurchase Not applicable Progress of reducing repurchased shares via centralized bidding Not applicable Impact of share changes on basic and diluted earnings per share net assets per share attributable to ordinary shareholders and other financial indicators for the most recent year and the latest period Not applicable 31FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Other information deemed necessary by the Company or required by securities regulatory authorities Not applicable 2. Changes in Restricted Shares Unit: Share Beginning of Unlocked in Increased in period current period current End of period Name of period Number of Reason for Date of shareholder Number of Number of restricted restricted Number of restricted lock-up unlocking shares shares restricted sharesshares Locked shares Pan Bo 172537 0 57513 230050 of outgoing Not applicable executives Locked shares Lu Wanjun 120037 0 40013 160050 of outgoing Not applicable executives Li Ming 120067 0 0 120067 Executivelocked shares Not applicable Liu Xiaoming 120037 0 0 120037 Executivelocked shares Not applicable Locked shares Tang Haiyuan 80662 0 26888 107550 of outgoing Not applicable executives Unlocked in accordance Locked shares with relevant Hu Jing 9000 1500 0 7500 of outgoing laws and supervisors regulationsgoverning supervisor locked shares.Total 622340 1500 124414 745254 -- -- II. Issuance and Listing of Securities Not applicable III. Number of Shareholders and Shareholding Status Unit: Share Total number of Total number of preferred shareholders ordinary shareholders with restored voting rights at the end of at the end of the 29296 the reporting period (if any) (see Note 0 reporting period 8) Shareholding of shareholders holding 5% or more shares or the top 10 shareholders (excluding shares lent via refinancing) Nature Shareho Number of Increase/d Number of Pledged marked or Name of of lding Number ofshares held ecrease restricted frozen status shareholder shareh percenta at the end of during the shares unrestricted older ge shares heldthe reporting held Share status Quanti 32FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) reporting period ty period Shentian Technology State- Holding owned 40.17% 162977327 0 0 16297732 Not 0 (Shenzhen) legal 7 applicable Co. Ltd. person Domest # Wu Jilin icnatural 4.73% 19189124 2337198 0 19189124 Not applicable 0 person Qianhai Life Insurance Co. Ltd. - Dividend Other 3.99% 16183970 -2400 0 16183970 Not applicable 0 Insurance Product Bank of China Limited - Huashang Selected Other 0.96% 3906000 2641700 0 3906000 Not 0 Return Mixed applicable Securities Investment Fund Hong Kong Securities Foreign Clearing legal 0.78% 3144933 1581432 0 3144933 Not Company person applicable 0 Limited China Merchants Bank Co.Ltd. - Huashang Quality Value Other 0.68% 2763400 1814600 0 2763400 Not applicable 0 Mixed Securities Investment Fund Domest # Zhu Rui ic Notnatural 0.59% 2382300 285700 0 2382300 applicable 0 person Bank of China Limited - Huashang Vision Value Other 0.55% 2236500 1301200 0 2236500 Notapplicable 0Mixed Securities Investment Fund CITIC Securities Other 0.53% 2152000 1278600 0 2152000 Not 0 Co. Ltd. - applicable 33FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Huatai- PineBridge CSI Central SOE Dividend Exchange- Traded Fund (ETF) Domest # Wang Xing ic Notnatural 0.53% 2141400 321100 0 2141400 applicable 0 person Circumstances where strategic investors or general legal persons became top 10 shareholders due to Not applicable placement of new shares (if any) (see Note 3) Explanation of related- party relationships or The Company is not aware of whether there are related-party relationships or concerted concerted action among action among the above 10 shareholders.the above shareholders Explanation of voting rights entrusted by/to Shareholder Shentian Technology Holding authorized a representative to exercise voting or waived by the above rights on its behalf representing 162977327 shares at the 2025 Annual General Meeting.shareholders For voting results please refer to relevant announcements published on Cninfo.Special explanation on the existence of a repurchase special account among the top Not applicable 10 shareholders (if any) (see Note 11) Shareholding of top 10 unrestricted shareholders (excluding shares lent via refinancing and executive locked shares) Number of Share class Name of shareholder unrestricted sharesheld at the end of the Share class Quantity reporting period Shentian Technology Holding (Shenzhen) Co. Ltd. 162977327 RMB ordinaryshares 162977327 # Wu Jilin 19189124 RMB ordinaryshares 19189124 Qianhai Life Insurance Co. Ltd. - Dividend Insurance RMB ordinary Product 16183970 shares 16183970 Bank of China Limited - Huashang Selected Return Mixed RMB ordinary Securities Investment Fund 3906000 shares 3906000 Hong Kong Securities Clearing Company Limited 3144933 RMB ordinaryshares 3144933 China Merchants Bank Co. Ltd. - Huashang Quality Value 2763400 RMB ordinaryMixed Securities Investment Fund shares 2763400 # Zhu Rui 2382300 RMB ordinaryshares 2382300 Bank of China Limited - Huashang Vision Value Mixed RMB ordinary Securities Investment Fund 2236500 shares 2236500 34FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) CITIC Securities Co. Ltd. - Huatai-PineBridge CSI Central RMB ordinary SOE Dividend Exchange-Traded Fund (ETF) 2152000 shares 2152000 # Wang Xing 2141400 RMB ordinaryshares 2141400 Explanation of related- party relationships or concerted action among the top 10 unrestricted shareholders and The Company is not aware of whether there are related-party relationships or concerted between the top 10 action among the above 10 shareholders.unrestricted shareholders and the top 10 shareholders 1. Company shareholder Wu Jilin held 4613302 shares through a regular securities Explanation of top 10 account and 14575822 shares through a client credit collateral securities account at China ordinary shareholders CICC Wealth Management Securities Co. Ltd. totaling 19189124 shares; participating in margin 2. Company shareholder Zhu Rui held 2600 shares through a regular securities account financing and securities and 2379700 shares through a client credit collateral securities account at First Capital lending business (if Securities Co. Ltd. totaling 2382300 shares; any) 3. Company shareholder Wang Xing held 1831400 shares through a regular securitiesaccount and 310000 shares through a client credit collateral securities account at China Merchants Securities Co. Ltd. totaling 2141400 shares.Share lending via refinancing business by shareholders holding 5% or more shares top 10 shareholders and top 10 unrestricted circulating shareholders Not applicable Changes in top 10 shareholders and top 10 unrestricted circulating shareholders compared to the prior period due to share lending/return via refinancing Not applicable Whether the top 10 ordinary shareholders and top 10 unrestricted ordinary shareholders engaged in agreed repurchase transactions during the reporting period No IV. Changes in Shareholding of Directors and Senior Executives Not applicable The shareholdings of Directors and Senior Executives remained unchanged during the reporting period. For details please refer to the 2025 Annual Report.V. Changes in Controlling Shareholder or De Facto Controller If the Company previously disclosed plans for a change in control by the de facto controller that have not been completed please explain the progress of the change in control.Not applicable Change in controlling shareholder during the reporting period Not applicable Change in de facto controller during the reporting period Not applicable 35FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) VI. Preferred Shares Not applicable Section VII Bonds Not applicable 36FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Section VIII Financial Report I. Audit Report Whether the Interim Report has been audited No II. Financial Statements The unit in the notes to the financial statements is: RMB 1. Consolidated Balance Sheet Prepared by: FIYTA Precision Technology Co. Ltd.June 30 2026 Unit: RMB Item Ending balance Beginning balance Current assets: Cash and cash equivalents 657780338.81 631239039.65 Settlement reserve Lending funds Financial assets held for trading Derivative financial assets Notes receivable 15179652.64 13617187.55 Accounts receivable 264290477.99 249868540.94 Receivables financing Prepayments 26452620.03 4912759.05 Premiums receivable Reinsurance accounts receivable Reinsurance contract reserve Other receivables 55463903.88 51040153.19 Including: Interest receivable Dividends receivable Financial assets purchased under agreements to resell Inventories 1462500282.14 1727982404.66 Including: Data resources Contract assets Assets held for sale Non-current assets due within one year Other current assets 138092496.03 66510872.63 Total current assets 2619759771.52 2745170957.67 37FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Non-current assets: Loans and advances granted Debt investments Other debt investments Long-term receivables Long-term equity investments 46672153.60 46436556.86 Other equity instrument investments Other non-current financial assets Investment properties 301443999.00 308270580.37 Fixed assets 337417287.88 343353998.15 Construction in progress Productive biological assets Oil and gas assets Right-of-use assets 62048131.85 72791092.06 Intangible assets 30920347.73 31720744.04 Including: Data resources Development expenditure Including: Data resources Goodwill Long-term prepaid expenses 68950815.87 89174269.50 Deferred income tax assets 93267447.01 90726063.88 Other non-current assets 171008639.08 5757347.81 Total non-current assets 1111728822.02 988230652.67 Total assets 3731488593.54 3733401610.34 Current liabilities: Short-term borrowings Borrowings from the central bank Placements from banks and other financial institutions Financial liabilities held for trading Derivative financial liabilities Notes payable Accounts payable 68846072.91 94791440.02 Advances from customers 7051846.87 11368005.63 Contract liabilities 18121608.21 16450934.50 Financial assets sold under agreements to repurchase Customer deposits and deposits from other banks Funds received as agent of securities trading Funds received as agent of securities underwriting 38FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Employee benefits payable 64278748.33 80059217.82 Taxes and surcharges payable 50056542.45 40198014.04 Other payables 78195511.10 75141232.27 Including: Interest payable Dividends payable Handling charges and commissions payable Reinsurance payables Liabilities held for sale Non-current liabilities due within one year 48155286.06 57044492.54 Other current liabilities 1870242.74 2392725.11 Total current liabilities 336575858.67 377446061.93 Non-current liabilities: Insurance contract reserve Long-term borrowings Bonds payable Including: Preferred shares Perpetual bonds Lease liabilities 14736464.18 17892390.31 Long-term payables Long-term employee benefits payable Provisions Deferred income Deferred income tax liabilities 583008.14 1522995.65 Other non-current liabilities Total non-current liabilities 15319472.32 19415385.96 Total liabilities 351895330.99 396861447.89 Owners' equity: Share capital 405764007.00 405764007.00 Other equity instruments Including: Preferred shares Perpetual bonds Capital reserve 935609251.94 935609251.94 Less: Treasury shares Other comprehensive income 14994784.98 23665217.37 Special reserve 3872012.79 3961169.87 Surplus reserve 275010401.50 275010401.50 General risk reserve Undistributed profits 1744342804.34 1692530114.77 Total equity attributable to owners of the parent company 3379593262.55 3336540162.45 Non-controlling interests Total owners' equity 3379593262.55 3336540162.45 Total liabilities and owners' equity 3731488593.54 3733401610.34 Legal Representative: Zhou Jinqun Chief Financial Officer: Song Yaoming Head of Accounting Department: 39FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Jiang Haiming 2. Balance Sheet of the Parent Company Unit: RMB Item Ending balance Beginning balance Current assets: Cash and cash equivalents 547732738.10 457084217.33 Financial assets held for trading Derivative financial assets Notes receivable Accounts receivable 19832052.07 9983210.72 Receivables financing Prepayments Other receivables 361944183.93 545751274.33 Including: Interest receivable Dividends receivable Inventories 8183772.06 35526848.62 Including: Data resources Contract assets Assets held for sale Non-current assets due within one year Other current assets 29608376.75 25674166.66 Total current assets 967301122.91 1074019717.66 Non-current assets: Debt investments Other debt investments Long-term receivables Long-term equity investments 1639216039.51 1638980442.77 Other equity instrument investments Other non-current financial assets Investment properties 213212587.10 218384208.08 Fixed assets 239695300.64 242887333.30 Construction in progress Productive biological assets Oil and gas assets Right-of-use assets Intangible assets 23130780.28 24260033.91 Including: Data resources Development expenditure Including: Data resources Goodwill 40FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Long-term prepaid expenses 12350444.88 12299699.77 Deferred income tax assets 31026695.78 20283973.50 Other non-current assets 163831502.68 1989858.55 Total non-current assets 2322463350.87 2159085549.88 Total assets 3289764473.78 3233105267.54 Current liabilities: Short-term borrowings Financial liabilities held for trading Derivative financial liabilities Notes payable Accounts payable 5905907.39 111122030.74 Advances from customers 8121477.80 11369857.62 Contract liabilities Employee benefits payable 18189531.94 17665486.91 Taxes and surcharges payable 3584364.38 790242.76 Other payables 386552692.89 297160359.41 Including: Interest payable Dividends payable Liabilities held for sale Non-current liabilities due within one year Other current liabilities Total current liabilities 422353974.40 438107977.44 Non-current liabilities: Long-term borrowings Bonds payable Including: Preferred shares Perpetual bonds Lease liabilities Long-term payables Long-term employee benefits payable Provisions Deferred income Deferred income tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities 422353974.40 438107977.44 Owners' equity: Share capital 405764007.00 405764007.00 Other equity instruments Including: Preferred shares Perpetual bonds Capital reserve 938999713.64 938999713.64 Less: Treasury shares 41FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Other comprehensive income Special reserve Surplus reserve 275010401.50 275010401.50 Undistributed profits 1247636377.24 1175223167.96 Total owners' equity 2867410499.38 2794997290.10 Total liabilities and owners' equity 3289764473.78 3233105267.54 Legal Representative: Zhou Jinqun Chief Financial Officer: Song Yaoming Head of Accounting Department: Jiang Haiming 3. Consolidated Income Statement Unit: RMB Item First half of 2026 First half of 2025 I. Total operating revenue 1840480340.48 1784131937.23 Including: Operating revenue 1840480340.48 1784131937.23 Interest income Premiums earned Handling charges and commission income II. Total operating costs 1714427144.42 1686829306.89 Including: Operating costs 1196202821.77 1149808611.57 Interest expense Handling charges and commission expenses Surrender values Net compensation expenses Net appropriation of insurance contract reserve Policy dividend expenses Reinsurance expenses Taxes and surcharges 18462441.06 15513201.04 Selling expenses 360654255.33 392808032.65 Administrative expenses 95354788.74 89971510.01 R&D expenses 40717396.64 33087871.33 Financial expenses 3035440.88 5640080.29 Interest expense 1186429.02 2390395.42 Interest income 1831836.70 1870950.85 Add: Other income 3155303.04 2946889.68 Investment income (loss is indicated by "-") 630153.96 742044.98 Including: Investment income from associates and joint 235596.74 494545.14 ventures Gains on derecognition of financial assets measured at amortized cost Foreign exchange gains (loss 42FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) is indicated by "-") Net exposure hedging gains (loss is indicated by "-") Gains from changes in fair value (loss is indicated by "-") Credit impairment losses (loss is indicated by "-") 1098927.84 2228174.46 Asset impairment losses (loss is indicated by "-") 1780567.39 Gains on disposal of assets (loss is indicated by "-") 474063.48 -424407.32 III. Operating profit (loss is indicated by "-") 131411644.38 104575899.53 Add: Non-operating income 653081.03 1204207.92 Less: Non-operating expenses 400214.22 219441.69 IV. Total profit (total loss is indicated by "-") 131664511.19 105560665.76 Less: Income tax expense 31160140.78 23115165.73 V. Net profit (net loss is indicated by "-")100504370.4182445500.03 (I) Categorized by operating continuity 1. Net profit from continuing operations (net loss is indicated by "- 100504370.41 82445500.03 ") 2. Net profit from discontinued operations (net loss is indicated by "- ") (II) Categorized by ownership attribution 1. Net profit attributable to shareholders of the parent company 100504370.41 82445500.03 (net loss is indicated by "-") 2. Profit or loss attributable to non-controlling interests (net loss is indicated by "-") VI. Other Comprehensive Income Net of Tax -8670432.39 9592491.09 Net other comprehensive income attributable to owners of the parent -8670432.39 9592491.09 company after tax (I) Other comprehensive income that cannot be reclassified to profit or loss 1. Changes in remeasurement of defined benefit plans 2. Other comprehensive income that cannot be transferred to profit or loss under the equity method 3. Fair value changes of other equity instrument investments 4. Fair value changes of enterprise's own credit risk 5. Other 43FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (II) Other comprehensive income that will be reclassified to profit or -8670432.39 9592491.09 loss 1. Other comprehensive income that can be transferred to profit or loss under the equity method 2. Fair value changes of other debt investments 3. Amount of financial assets reclassified into other comprehensive income 4. Credit impairment provisions for other debt investments 5. Cash flow hedge reserve 6. Translation differences of foreign currency financial statements -8670432.39 9592491.09 7. Other Net other comprehensive income attributable to non-controlling interests after tax VII. Total Comprehensive Income 91833938.02 92037991.12 Total comprehensive income attributable to owners of the parent 91833938.02 92037991.12 company Total comprehensive income attributable to non-controlling interests VIII. Earnings Per Share: (I) Basic earnings per share 0.2477 0.2034 (II) Diluted earnings per share 0.2477 0.2034 Legal Representative: Zhou Jinqun Chief Financial Officer: Song Yaoming Head of Accounting Department: Jiang Haiming 4. Income Statement of the Parent Company Unit: RMB Item First half of 2026 First half of 2025 I. Operating revenue 80539710.30 81474823.42 Less: Operating costs 41246617.92 25511651.20 Taxes and surcharges 4062559.84 3821053.25 Selling expenses 32373061.83 17415912.81 Administrative expenses 38760021.37 27948465.95 R&D expenses 9168396.13 6543258.58 Financial expenses -1263832.96 -1776950.85 Interest expense 66406.39 -54463.04 Interest income 1384769.95 1566068.25 Add: Other income 764312.77 818743.58 Investment income (loss is indicated by "-") 153590219.07 494545.14 Including: Investment 235596.74 494545.14 income from associates and joint 44FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) ventures Gains on derecognition of financial assets measured at amortized cost (loss is indicated by "-") Net exposure hedging gains (loss is indicated by "-") Gains from changes in fair value (loss is indicated by "-") Credit impairment losses (loss is indicated by "-") 52237.67 -462263.85 Asset impairment losses (loss is indicated by "-") Gains on disposal of assets (loss is indicated by "-") -45519.85 II. Operating profit (loss is indicated by "-") 110554135.83 2862457.35 Add: Non-operating income 26139.97 23782.21 Less: Non-operating expenses 196857.96 6.18 III. Total profit (total loss is indicated by "-") 110383417.84 2886233.38 Less: Income tax expense -10721472.28 511106.83 IV. Net profit (net loss is indicated by "-")121104890.122375126.55 (I) Net profit from continuing operations (net loss is indicated by "- 121104890.12 2375126.55 ") (II) Net profit from discontinued operations (net loss is indicated by "- ") V. Other Comprehensive Income Net of Tax (I) Other comprehensive income that cannot be reclassified to profit or loss 1. Changes in remeasurement of defined benefit plans 2. Other comprehensive income that cannot be transferred to profit or loss under the equity method 3. Fair value changes of other equity instrument investments 4. Fair value changes of enterprise's own credit risk 5. Other (II) Other comprehensive income that will be reclassified to profit or loss 1. Other comprehensive income that can be transferred to profit or loss under the equity method 2. Fair value changes of other debt investments 45FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 3. Amount of financial assets reclassified into other comprehensive income 4. Credit impairment provisions for other debt investments 5. Cash flow hedge reserve 6. Translation differences of foreign currency financial statements 7. Other VI. Total Comprehensive Income 121104890.12 2375126.55 VII. Earnings Per Share: (I) Basic earnings per share (II) Diluted earnings per share Legal Representative: Zhou Jinqun Chief Financial Officer: Song Yaoming Head of Accounting Department: Jiang Haiming 5. Consolidated Cash Flow Statement Unit: RMB Item First half of 2026 First half of 2025 I. Cash flows from operating activities: Cash received from sale of goods and rendering of services 2007937285.55 1918518666.40 Net increase in customer deposits and placements from other banks Net increase in borrowings from central bank Net increase in placements from other financial institutions Cash received from premiums of original insurance contracts Net cash received from reinsurance business Net increase in policyholders' deposits and investment funds Cash received from interest handling charges and commissions Net increase in placements from banks and other financial institutions Net increase in repurchase business funds Net cash received from agent securities trading Refunds of taxes and surcharges 3206857.32 765302.02 Cash received relating to other operating activities 10085016.64 20316713.59 Subtotal of cash inflows from operating activities 2021229159.51 1939600682.01 Cash paid for goods purchased and services received 1060649891.91 1117286716.61 Net increase in loans and advances to customers 46FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Net increase in deposits with central bank and other banks Cash paid for claims of original insurance contracts Net increase in lending funds Cash paid for interest handling charges and commissions Cash paid for policy dividends Cash paid to and on behalf of employees 274798070.57 295806175.23 Payments of various taxes and surcharges 143475206.37 123135450.22 Cash paid relating to other operating activities 158333370.26 151881532.88 Subtotal of cash outflows from operating activities 1637256539.11 1688109874.94 Net cash flows from operating activities 383972620.40 251490807.07 II. Cash flows from investing activities: Cash received from recovery of investments Cash received from investment income 9387.93 297627.16 Net cash received from disposal of fixed assets intangible assets and 32260.84 134782.34 other long-term assets Net cash received from disposal of subsidiaries and other business units Cash received relating to other investing activities 3389433.51 104282319.06 Subtotal of cash inflows from investing activities 3431082.28 104714728.56 Cash paid for acquisition and construction of fixed assets intangible assets and other long- 26748244.92 33910801.03 term assets Cash paid for investments Net increase in pledged loans Net cash paid for acquisition of subsidiaries and other business units 162395200.00 Cash paid relating to other investing activities 76251159.49 111168651.92 Subtotal of cash outflows from investing activities 265394604.41 145079452.95 Net cash flows from investing activities -261963522.13 -40364724.39 III. Cash flows from financing activities: Cash received from capital contributions Including: Cash received by subsidiaries from capital contributions of non-controlling shareholders Cash received from borrowings 11000000.00 140000000.00 47FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Cash received relating to other financing activities Subtotal of cash inflows from financing activities 11000000.00 140000000.00 Cash paid for debt repayments 11000000.00 120000000.00 Cash paid for distribution of dividends or profits and payment of 48724606.91 165355261.79 interest Including: Dividends and profits paid by subsidiaries to non- controlling shareholders Cash paid relating to other financing activities 46135370.10 45795435.69 Subtotal of cash outflows from financing activities 105859977.01 331150697.48 Net cash flows from financing activities -94859977.01 -191150697.48 IV. Effect of Exchange Rate Changes on Cash and Cash Equivalents -607822.10 377371.28 V. Net Increase in Cash and Cash Equivalents 26541299.16 20352756.48 Add: Beginning balance of cash and cash equivalents 631239039.65 518954177.49 VI. Ending Balance of Cash and Cash Equivalents 657780338.81 539306933.97 Legal Representative: Zhou Jinqun Chief Financial Officer: Song Yaoming Head of Accounting Department: Jiang Haiming 6. Cash Flow Statement of the Parent Company Unit: RMB Item First half of 2026 First half of 2025 I. Cash flows from operating activities: Cash received from sale of goods and rendering of services 75602738.85 79872428.27 Refunds of taxes and surcharges 13830.30 Cash received relating to other operating activities 1816612718.85 1750398006.10 Subtotal of cash inflows from operating activities 1892229288.00 1830270434.37 Cash paid for goods purchased and services received 109756546.00 9263532.80 Cash paid to and on behalf of employees 46266009.30 40073696.79 Payments of various taxes and surcharges 3383934.91 5903973.37 Cash paid relating to other operating activities 1578059018.09 1585917118.90 Subtotal of cash outflows from operating activities 1737465508.30 1641158321.86 Net cash flows from operating activities 154763779.70 189112112.51 II. Cash flows from investing activities: 48FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Cash received from recovery of investments Cash received from investment income 153354622.33 Net cash received from disposal of fixed assets intangible assets and 12635.00 other long-term assets Net cash received from disposal of subsidiaries and other business units Cash received relating to other investing activities Subtotal of cash inflows from investing activities 153367257.33 Cash paid for acquisition and construction of fixed assets intangible assets and other long- 6298513.00 5249498.62 term assets Cash paid for investments Net cash paid for acquisition of subsidiaries and other business units 162395200.00 Cash paid relating to other investing activities Subtotal of cash outflows from investing activities 168693713.00 5249498.62 Net cash flows from investing activities -15326455.67 -5249498.62 III. Cash flows from financing activities: Cash received from capital contributions Cash received from borrowings 11000000.00 140000000.00 Cash received relating to other financing activities Subtotal of cash inflows from financing activities 11000000.00 140000000.00 Cash paid for debt repayments 11000000.00 120000000.00 Cash paid for distribution of dividends or profits and payment of 48724606.91 165355261.79 interest Cash paid relating to other financing activities Subtotal of cash outflows from financing activities 59724606.91 285355261.79 Net cash flows from financing activities -48724606.91 -145355261.79 IV. Effect of Exchange Rate Changes on Cash and Cash Equivalents -64196.35 -14118.87 V. Net Increase in Cash and Cash Equivalents 90648520.77 38493233.23 Add: Beginning balance of cash and cash equivalents 457084217.33 390160466.41 VI. Ending Balance of Cash and Cash Equivalents 547732738.10 428653699.64 Legal Representative: Zhou Jinqun Chief Financial Officer: Song Yaoming Head of Accounting Department: Jiang Haiming 49FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 7. Consolidated Statement of Changes in Owners' Equity Amount in Current Period Unit: RMB First half of 2026 Equity attributable to owners of the parent company Other equity Oth Non Tot instruments LesCap s: er Spe Sur Gen Und - al Item Sha ital Tre com cial plus eral istri cont Pref Per rolli ownre pre risk but Oth Sub capi erre pet res asu res res ng ers' Oth erv ry hen erv erv res ed er total intetal d ual equi sive erv prof rest sha bon er e sha inco e e s ty e its res ds res me 163333 I. Ending 405 935 23 275 balance of 76 60 665 3901923636 the previous 40 92 21 61530540540 07.51.7.3169 04 01. 11 16 16year 00 94 7 .87 50 4.7 2.4 2.47 5 5 Add: Changes in accounting policies Co rrection of prior-period errors Ot her II. 405 935 23 275 16 33 33 Beginning 76 60 665 39 01 92 36 36 balance of 40 92 21 61 04 530 540 540 the current 07. 51. 7.3 169 01. 11 16 16 year 00 94 7 .87 50 4.7 2.4 2.47 5 5 III.Increase/de crease - - 51 43 43amount in 86 89 812 053 053current 70 157 68 10 10period 432 9.5 0.1 0.1 (decrease is .39 .08 7 0 0 indicated by "-") -1009191 (I) Total 86 50 833 833 comprehen 70 43 93 93 sive income 432 70. 8.0 8.0.394122 (II) Capital contributed and reduced by 50FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) owners 1. Ordinary shares contributed by owners 2. Capital contributed by holders of other equity instruments 3. Amount of share- based payments recognized in owners' equity 4. Other --- 484848 (III) Profit 691 691 691 distribution 68 68 68 0.80.80.8 444 1. Appropriatio n to surplus reserve 2. Appropriatio n to general risk reserve 3.--- Distribution 48 48 48 to owners 691 691 691 (or 68 68 68 shareholder 0.8 0.8 0.8 s) 4 4 4 4. Other (IV) Internal carry-over of owners' equity 1. Capital reserve converted into capital (or share capital) 2. Surplus reserve converted into capital 51FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (or share capital) 3. Surplus reserve making up for losses 4. Changes in defined benefit plans carried forward to retained earnings 5. Other comprehen sive income carried forward to retained earnings 6. Other --- (V) Special 89 89 89 reserve 157 157 157.08.08.08 1.260260260 Appropriatio 69 69 69 n during the 1.3 1.3 1.3 period 0 0 0 --- 2. Utilization 349 349 349 during the 84 84 84 period 8.3 8.3 8.3 888 (VI) Other IV. Ending 405 935 14 275 173333 balance of 76 60 994 38447979 40927872 01 current 012 04 342593593 07. 51. 4.9 01. 80 26 26period 00 94 8 .79 50 4.3 2.5 2.54 5 5 Amount in Previous Year Unit: RMB First half of 2025 Equity attributable to owners of the parent company Non Other equity Les Oth - Tot instruments Cap s: Gen Under Spe Sur cont al Item Sha re ital Tre com cial plus eral istri rolli own Pref Per capi res asu pre res res risk but Oth Sub ng ers' erre pet Oth erv ry erv erv res ed er totalhen inte equital d ual er e sha sive e e erv prof rest ty sha bon res e itsinco s 52FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) res ds me 173333 I. Ending 405 936 12 15 275 balance of 76 33 815 686 430167919140517843843 the previous 40 95 55 79 04 year 07. 03. 6.8 4.6 16201.882020 006012.76507.90.60.6411 Add: Changes in accounting policies Co rrection of prior-period errors Ot her II. 405 936 12 15 275 17 33 33 Beginning 76 33 815 686 43 01 67 91 91 balance of 40 95 55 79 40162 04 517843843 the current 07. 03. 6.8 4.6 01. 88 20 20 year 00 60 1 2 .76 50 7.9 0.6 0.64 1 1 III.Increase/de crease - - - - - amount in 730 12 95 - 79 58 58 current 25 815 92 51 860 233 233 period 1.6 55 491 210 10 51 51 (decrease is 6 6.8 .09 .69 2.7 7.2 7.2 indicated by 1 7 2 2 "-") 829292 (I) Total 95 445 037 037 comprehen 92 50 99 99 sive income 491.09 0.0 1.1 1.13 2 2 (II) Capital - - 12 12 contributed 730 12815 085 085and 25 55 30 30reduced by 1.6 5.1 5.1 owners 6 6.81 5 5 1. Ordinary shares contributed by owners 2. Capital contributed by holders of other equity instruments 3. Amount - - 12 12 of share- 730 12 085 085 53FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) based 25 815 30 30 payments 1.6 55 5.1 5.1 recognized 6 6.8 5 5 in owners' 1 equity 4. Other --- 162162162 (III) Profit 30 30 30 distribution 56 56 56 02.02.02. 808080 1. Appropriatio n to surplus reserve 2. Appropriatio n to general risk reserve 3.--- Distribution 162 162 162 to owners 30 30 30 (or 56 56 56 shareholder 02. 02. 02.s) 80 80 80 4. Other (IV) Internal carry-over of owners' equity 1. Capital reserve converted into capital (or share capital) 2. Surplus reserve converted into capital (or share capital) 3. Surplus reserve making up for losses 4. Changes in defined benefit plans carried forward to retained 54FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) earnings 5. Other comprehen sive income carried forward to retained earnings 6. Other --- (V) Special 51 51 51 reserve 210 210 210.69.69.69 1.223223223 Appropriatio 17 17 17 n during the 7.6 7.6 7.6 period 4 4 4 --- 2. Utilization 274 274 274 during the 38 38 38 period 8.3 8.3 8.3 333 (VI) Other IV. Ending 405 935 25 275 163333 76 60 279 42 01 87 33 33balance of 40 92 28 88 04 657 609 609current 952 78 68 68 period 07. 51. 5.7 01.00 94 1 .07 50 5.1 3.3 3.37 9 9 Legal Representative: Zhou Jinqun Chief Financial Officer: Song Yaoming Head of Accounting Department: Jiang Haiming 8. Statement of Changes in Owners' Equity of the Parent Company Amount in Current Period Unit: RMB First half of 2026 Other equity Less: Otherinstruments Undis Item Share Capit Treas comp Speci Surpl Total capita Prefe Perpe al ury rehen al us tribut reser sive reser reser ed Other owne l rred tual share rs' share bond Other ve s incom ve ve profit equity s s e s I. Ending 1175 2794 balance of 4057 9389 2750 223 997 the previous 6400 9971 1040 year 7.00 3.64 1.50 167.9290.1 60 Add: Changes in accounting policies Co 55FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) rrection of prior-period errors Ot her II.Beginning 4057 9389 2750 1175 2794 balance of 6400 9971 1040 223 997 the current 7.00 3.64 1.50 167.9 290.1 year 6 0 III.Increase/de crease amount in 7241 7241 current 3209 3209 period .28 .28 (decrease is indicated by "-") (I) Total 1211 1211 comprehen 0489 0489 sive income 0.12 0.12 (II) Capital contributed and reduced by owners 1. Ordinary shares contributed by owners 2. Capital contributed by holders of other equity instruments 3. Amount of share- based payments recognized in owners' equity 4. Other -- (III) Profit 4869 4869 distribution 1680 1680.84.84 1. Appropriatio n to surplus reserve 2.-- 56FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Distribution 4869 4869 to owners 1680 1680 (or .84 .84 shareholder s) 3. Other (IV) Internal carry-over of owners' equity 1. Capital reserve converted into capital (or share capital) 2. Surplus reserve converted into capital (or share capital) 3. Surplus reserve making up for losses 4. Changes in defined benefit plans carried forward to retained earnings 5. Other comprehen sive income carried forward to retained earnings 6. Other (V) Special reserve 1. Appropriatio n during the period 2. Utilization during the period (VI) Other IV. Ending 4057 9389 2750 1247 2867 57FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) balance of 6400 9971 1040 636 410 current 7.00 3.64 1.50 377.2 499.3 period 4 8 Amount in Previous Year Unit: RMB First half of 2025 Other equity Other instruments Capit Less: comp Speci Surpl UndisShare Treas tribut TotalItem capita Prefe Perpe al rehen al us owne l rred tual reser ury sive reser reser ed Other rs' share bond Other ve share s incom ve ve profit s equity s s e I. Ending 4057 9392 1281 2750 1206 2813balance of 6400 1799 5556 1040 072 249the previous year 7.00 9.41 .81 1.50 217.1068.2 44 Add: Changes in accounting policies Co rrection of prior-period errors Ot her II.Beginning 4057 9392 1281 2750 1206 2813 balance of 6400 1799 5556 1040 072 249 the current 7.00 9.41 .81 1.50 217.1 068.2 year 4 4 III.Increase/de crease amount in - - - - current 2182 1281 1599 1473 period 85.77 5556 3047 3320 (decrease is .81 6.25 5.21 indicated by "-") (I) Total 2375 2375 comprehen 126. 126.sive income 55 55 (II) Capital contributed - - 1259 and 2182 12815556 7271reduced by 85.77 owners .81.04 1. Ordinary shares contributed by owners 58FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 2. Capital contributed by holders of other equity instruments 3. Amount of share- based - - 1259 payments 2182 1281 7271 recognized 85.77 5556 in owners' .81.04 equity 4. Other -- (III) Profit 1623 1623 distribution 0560 0560 2.802.80 1. Appropriatio n to surplus reserve 2. Distribution - - to owners 1623 1623 (or 0560 0560 shareholder 2.80 2.80 s) 3. Other (IV) Internal carry-over of owners' equity 1. Capital reserve converted into capital (or share capital) 2. Surplus reserve converted into capital (or share capital) 3. Surplus reserve making up for losses 4. Changes in defined benefit plans carried 59FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) forward to retained earnings 5. Other comprehen sive income carried forward to retained earnings 6. Other (V) Special reserve 1. Appropriatio n during the period 2. Utilization during the period (VI) Other IV. Ending 1046 2665 balance of 4057 9389 27506400 9971 1040 141 915current 7.00 3.64 1.50 740.8 863.0period 9 3 Legal Representative: Zhou Jinqun Chief Financial Officer: Song Yaoming Head of Accounting Department: Jiang Haiming III. Basic Information of the Company 1. Domicile Organizational Form and Address of the Company FIYTA Precision Technology Co. Ltd. (hereinafter referred to as the "Company" or "our Company") was restructured from "Shenzhen FIYTA Timepiece Industry Company" with China National Aero-Technology Import & Export Shenzhen Industry & Trade Center (subsequently renamed "China National Aero-Technology Shenzhen Co.Ltd.") as the promoter upon approval by the General Office of Shenzhen Municipal People's Government under document Shen Fu Ban Fu [1992] No. 1259 dated December 25 1992. The Company was listed on the Shenzhen Stock Exchange on June 3 1993 and currently holds a business license with the Unified Social Credit Code of 91440300192189783K. Following years of bonus share distributions rights issues capitalizations of reserve and additional share issuances as of June 30 2026 the Company had an aggregate issued share capital of 405764007 shares with a registered capital of RMB 405.764007 million. Registered address: FIYTA Technology Building Gaoxin South 1st Avenue Nanshan District Shenzhen Guangdong Province. Its parent company is Shentian Technology Holding (Shenzhen) Co. Ltd. and its ultimate controlling party is Aviation Industry Corporation of China Ltd. 2. Nature of Business and Principal Operating Activities The business nature and principal operating activities of the Company and its subsidiaries include: sale of timepieces; manufacturing of timepieces and timing instruments; sale of timepieces and timing instruments; wholesale of jewelry; retail of jewelry; manufacturing of smart wearable devices; sale of smart wearable devices; leasing of non- residential real estate; professional design services; sale of household appliances; sale of satellite mobile 60FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) communications terminals. (Except for items subject to approval according to law operating activities are carried out autonomously according to law with the business license) 3. Scope of Consolidated Financial Statements A total of 12 subsidiaries are included in the scope of consolidation for the current period. For details please refer to Note X. Interests in Other Entities. The entities included in the scope of consolidated financial statements in the current period remained unchanged compared with the previous period. 4. Approval of Financial Statements Date of approval for issuance of financial statements: These financial statements were approved for issuance by resolution of the Board of Directors of the Company on August 19 2026.IV. Basis of Preparation of Financial Statements 1. Basis of Preparation The Company prepares its financial statements on a going concern basis based on transactions and events that have actually occurred and in accordance with the recognition and measurement requirements of the Accounting Standards for Business Enterprises (CAS) Application Guidance and Interpretations. In addition the Company also discloses relevant financial information in accordance with CSRC's "Compilation Rules for Information Disclosure by Companies Offering Securities to the Public No. 15 — General Provisions on Financial Reports (Revised in 2023)". 2. Going Concern The Company assessed its ability to continue as a going concern for the 12 months from the end of the reporting period and found no events or conditions that cast significant doubt on its ability to continue as a going concern. It is reasonable for the Company to prepare the financial statements on a going concern basis.V. Significant Accounting Policies and Accounting Estimates Notes on specific accounting policies and accounting estimates: 1. The Company determines specific accounting policies and accounting estimates based on its production and operational characteristics primarily reflected in the methods for measuring expected credit losses on receivables (Note V.12 Note V.13 Note V.15) inventory valuation methods (Note V.17) depreciation of investment properties depreciation of fixed assets and amortization of intangible assets (Note V.23 Note V.24 Note V.29) revenue recognition (Note V.37) etc. 2. The Company continuously evaluates the significant accounting estimates and key assumptions adopted based on historical experience and other factors including reasonable expectations of future events. Material changes in the following significant accounting estimates and key assumptions may have a material impact on the carrying amounts of assets and liabilities in subsequent accounting years: (1) Provision for bad debts on accounts receivable and other receivables. Management estimates the impairment provision for accounts receivable and other receivables based on its judgment of expected credit losses. If any event or change in circumstances indicates that the Company may not recover the relevant balances estimates are required to accrue provisions for accounts receivable and other receivables. If the expected figures differ from the original estimates the difference will affect the carrying amount of accounts receivable and other receivables as well as the impairment charges in the period in which the estimate changes. 61FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (2) Estimation of inventory impairment. Inventories are measured at the lower of cost and net realizable value at the balance sheet date. The calculation of net realizable value requires the use of assumptions and estimates. If management revises the estimated selling prices and the costs and expenses to be incurred upon completion it will affect the estimate of the net realizable value of inventories and such difference will impact the accrued inventory write-down provision. (3) Estimation of impairment of long-term assets. When judging whether long-term assets are impaired management assesses and analyzes primarily from the following aspects: 1) whether events affecting asset impairment have occurred; 2) whether the present value of expected future cash flows from continuous use or disposal of the assets is lower than their carrying amount; and 3) whether the significant assumptions used in the present value of expected future cash flows are appropriate.If relevant assumptions adopted by the Company for determining impairment—such as profitability discount rates and growth rates used in the present value of future cash flows method—change they may have a material impact on the present value used in impairment testing and result in impairment of the Company's long-term assets. (4) Depreciation and amortization. The Company estimates the useful lives and net residual values of investment properties fixed assets and intangible assets based on the historical actual useful lives and net residual values of assets of a similar nature and function. During the use of assets the economic environment technological environment and other circumstances in which they operate may have a significant impact on their useful lives and estimated net residual values. If the estimated useful life and net residual value of an asset differ from the original estimates management will adjust them appropriately. (5) Deferred income tax assets. Deferred income tax assets shall be recognized for all unused tax losses to the extent that it is probable that sufficient taxable profits will be available against which the losses can be utilized. This requires management to exercise significant judgment to estimate the timing and amount of future taxable profits combined with tax planning strategies to determine the amount of deferred income tax assets to be recognized. (6) Income tax. In normal operating activities the ultimate tax treatment of many transactions and events involves uncertainties. Significant judgment is required when accruing for income tax. If the final determination of these tax matters differs from the amounts initially recorded such difference will impact the tax amount in the period during which such final determination is made. 1. Statement of Compliance with Accounting Standards for Business Enterprises The financial statements prepared by the Company comply with the requirements of the Accounting Standards for Business Enterprises and truly and completely reflect the financial position operating results changes in owners' equity cash flows and other relevant information of the Company. 2. Accounting Period The accounting year of the Company is from January 1 to December 31 of the Gregorian calendar. 3. Operating Cycle The normal operating cycle of the Company is one year. 62FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 4. Functional Currency The Company and its domestic subsidiaries adopt RMB as their functional currency. FIYTA (Hong Kong) Limited an overseas subsidiary of the Company determines HKD as its functional currency according to the primary economic environment in which it operates; Montres Chouriet SA a subsidiary of FIYTA (Hong Kong) Limited determines CHF as its functional currency according to the primary economic environment in which it operates. Their financial statements are translated into RMB when preparing consolidated financial statements. The presentation currency adopted by the Company for preparing these financial statements is RMB. 5. Method for Determining Materiality Criteria and Basis of Selection Item Materiality Criteria Accounts receivable with material bad debt provision reversed or recovered in the current period Individual ending balance exceeding RMB 1 million Material other payables aged over one year Individual ending balance exceeding RMB 1 million 6. Accounting Treatment of Business Combinations Under Common Control and Not Under Common Control (1) Business combinations under common control Assets and liabilities acquired by the Company in a business combination are measured at the merger date based on their carrying amounts in the consolidated financial statements of the ultimate controlling party. Where the accounting policies and accounting periods adopted by the combinee differ from those of the Company prior to the merger the accounting policies and periods are unified based on the materiality principle; that is the carrying amounts of the combinee's assets and liabilities are adjusted in accordance with the Company's accounting policies and accounting periods. Any difference between the carrying amount of net assets acquired and the carrying amount of consideration paid is adjusted against capital reserve (capital premium or share premium); if the capital reserve (capital premium or share premium) is insufficient to offset the difference the remaining balance is adjusted against surplus reserve and undistributed profits sequentially. (2) Business combinations not under common control Identifiable assets and liabilities of the acquiree acquired by the Company in a business combination are measured at fair value on the acquisition date. Where the accounting policies and accounting periods adopted by the acquiree differ from those of the Company prior to the merger the accounting policies and periods are unified based on the materiality principle; that is the carrying amounts of the acquiree's assets and liabilities are adjusted in accordance with the Company's accounting policies and accounting periods. The excess of the combination cost over the fair value of the acquiree's identifiable net assets acquired on the acquisition date is recognized as goodwill; if the combination cost is less than the fair value of the acquiree's identifiable net assets acquired the Company first re- evaluates the combination cost and the fair value of the acquiree's identifiable assets and liabilities. If the cost remains lower than the fair value of identifiable net assets acquired after review the difference is recognized in current profit or loss. (3) Treatment of transaction fees in business combinations Intermediary fees such as auditing legal services valuation and consulting fees and other related administrative expenses incurred for business combinations are recognized in profit or loss when incurred. Transaction fees for issuing equity securities or debt securities as combination consideration are included in the initial recognition amount of such equity or debt securities. 63FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 7. Criteria for Determining Control and Compilation Method of Consolidated Financial Statements (1) Criteria for determining control and scope of consolidation Control refers to the power the Company has over the investee whereby it is exposed to or has rights to variable returns from its involvement with the investee and has the ability to use its power over the investee to affect the amount of its returns. The definition of control contains three basic elements: first the investor has power over the investee; second the investor enjoys variable returns through involvement in the investee's related activities; third the investor has the ability to use its power over the investee to affect the amount of its returns. When the Company's investment in an investee meets all three elements it indicates that the Company controls the investee.The scope of consolidated financial statements is determined on the basis of control encompassing not only subsidiaries determined based on voting rights (or similar rights) alone or in combination with other arrangements but also structured entities governed by one or more contractual arrangements.A subsidiary refers to an entity controlled by the Company (including enterprises divisible parts of investees and structured entities controlled by the enterprise etc.). A structured entity refers to an entity designed so that voting rights or similar rights are not the dominant factor in deciding who controls the entity (sometimes referred to as a special purpose entity). (2) Compilation method of consolidated financial statements The Company prepares consolidated financial statements based on its own financial statements and those of its subsidiaries and using other relevant information.In preparing consolidated financial statements the Company treats the entire corporate group as a single accounting entity reflecting the group's overall financial position operating results and cash flows in accordance with unified accounting policies and periods pursuant to CAS recognition measurement and presentation requirements.* Consolidating items of assets liabilities owners' equity revenue expenses and cash flows of the parent company and its subsidiaries.* Offsetting the parent company's long-term equity investment in subsidiaries against its share of owners' equity in subsidiaries.* Offsetting the effects of internal transactions between the parent company and subsidiaries and among subsidiaries. Where internal transactions indicate impairment losses on relevant assets such losses shall be recognized in full.* Adjusting special transaction matters from the perspective of the enterprise group. (3) Special considerations in consolidation elimination * Long-term equity investments held by subsidiaries in the Company shall be regarded as treasury shares of the Company presented as a deduction in owners' equity under the item "Less: Treasury shares" in the consolidated balance sheet.Long-term equity investments held between subsidiaries shall be eliminated by offsetting the long-term equity investment against the corresponding share of owners' equity in the investee subsidiary mutatis mutandis to the Company's elimination method for subsidiaries.* Since "Special reserve" and "General risk reserve" are neither paid-in capital (or share capital) nor capital reserve and differ from retained earnings and undistributed profits they are restored based on the share attributable to owners of the parent company after the elimination of long-term equity investments and owners' equity of subsidiaries.* If temporary differences arise between the carrying amounts of assets and liabilities in the consolidated balance sheet and their tax bases in the respective taxable entities due to the elimination of unrealized internal sales profits and losses deferred income tax assets or deferred income tax liabilities are recognized in the consolidated 64FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) balance sheet with income tax expense in the consolidated income statement adjusted accordingly except for deferred income taxes related to transactions recognized directly in equity or business combinations.* Unrealized internal transaction profits and losses arising from the Company's sale of assets to subsidiaries shall be fully offset against "Net profit attributable to owners of the parent company". Unrealized internal transaction profits and losses arising from subsidiaries' sales of assets to the Company shall be allocated and offset between "Net profit attributable to owners of the parent company" and "Non-controlling interests" in proportion to the Company's allocation ratio to the subsidiary. Unrealized internal transaction profits and losses arising from sales of assets between subsidiaries shall be allocated and offset between "Net profit attributable to owners of the parent company" and "Non-controlling interests" in proportion to the Company's allocation ratio to the selling subsidiary.* Where the current loss shared by non-controlling shareholders of a subsidiary exceeds their share in the beginning owners' equity of the subsidiary the excess shall still be deducted from non-controlling interests. 8. Classification of Joint Arrangements and Accounting Treatment for Joint Operations A joint arrangement refers to an arrangement under the joint control of two or more parties. The Company's joint arrangements are classified into joint operations and joint ventures. (1) Joint operations A joint operation refers to a joint arrangement whereby the Company has rights to the assets and obligations for the liabilities relating to the arrangement.The Company recognizes the following items in relation to its share of interest in a joint operation and accounts for them in accordance with relevant CAS: * Recognize solely-held assets and jointly-held assets according to its share; * Recognize solely-incurred liabilities and jointly-incurred liabilities according to its share; * Recognize revenue from the sale of its share of output arising from the joint operation; * Recognize its share of revenue from the sale of output by the joint operation; * Recognize solely-incurred expenses and jointly-incurred expenses according to its share. (2) Joint ventures A joint venture refers to a joint arrangement whereby the Company only has rights to the net assets of the arrangement.The Company accounts for investments in joint ventures in accordance with the equity method provisions for long-term equity investments. 9. Determination Criteria for Cash and Cash Equivalents Cash refers to cash on hand and deposits that can be readily drawn upon for payments. Cash equivalents refer to short-term (generally maturing within three months from the acquisition date) highly liquid investments that are readily convertible to known amounts of cash and subject to an insignificant risk of changes in value. 10. Foreign Currency Transactions and Translation of Foreign Currency Statements (1) Determination of exchange rates for foreign currency transactions Foreign currency transactions of the Company are translated into the functional currency at initial recognition using the spot exchange rate on the transaction date or an exchange rate determined through a systematic and rational method that approximates the spot rate on the transaction date (hereinafter referred to as "approximate spot rate"). 65FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (2) Translation of foreign currency monetary items at the balance sheet date At the balance sheet date foreign currency monetary items are translated using the spot exchange rate at the balance sheet date. Exchange differences arising from differences between the spot rate at the balance sheet date and the spot rate at initial recognition or the previous balance sheet date are recognized in current profit or loss.Foreign currency non-monetary items measured at historical cost are still translated using the spot exchange rate on the transaction date; foreign currency non-monetary items measured at fair value are translated using the spot exchange rate on the date when the fair value is determined. For financial assets measured at fair value through profit or loss the difference between the translated functional currency amount and the original functional currency amount is recognized in current profit or loss. (3) Translation method for foreign currency statements Before translating the financial statements of overseas operations the accounting period and accounting policies of overseas operations are adjusted to align with those of the Company and financial statements in the respective currency (other than functional currency) are prepared based on adjusted accounting policies and periods followed by translation under the following rules: * Assets and liabilities items in the balance sheet are translated using the spot exchange rate at the balance sheet date; owners' equity items except for "Undistributed profits" are translated using the spot exchange rate at the time of occurrence.* Income and expense items in the income statement are translated using the spot exchange rate or approximate spot rate on the transaction date.* Foreign currency cash flows and cash flows of overseas subsidiaries are translated using the spot exchange rate or approximate spot rate on the date of cash flows. The effect of exchange rate changes on cash is presented separately in the cash flow statement as a reconciling item.* Resulting foreign currency statement translation differences are presented under "Other comprehensive income" within owners' equity in the consolidated balance sheet when compiling consolidated financial statements.Upon disposal of an overseas operation resulting in loss of control the foreign currency translation differences related to that overseas operation presented under owners' equity in the balance sheet are reclassified into current profit or loss in full or in proportion to the disposal. 11. Financial Instruments A financial instrument refers to a contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. (1) Recognition and derecognition of financial instruments The Company recognizes a financial asset or financial liability when it becomes a party to the contractual provisions of the instrument.A financial asset is derecognized when meeting one of the following conditions: * The contractual rights to receive cash flows from the financial asset expire; * The financial asset has been transferred and meets the criteria for derecognition of financial assets below.A financial liability (or part thereof) is derecognized when its present obligation has been discharged. Where an agreement is signed between the Company (debtor) and the lender to replace the existing financial liability by assuming a new financial liability with substantially different contractual terms the existing financial liability is derecognized and a new financial liability is recognized simultaneously. Where the Company makes substantial modifications to the contractual terms of an existing financial liability (or part thereof) the existing financial liability is derecognized and a new financial liability is recognized in accordance with modified terms. 66FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Purchases or sales of financial assets in a regular way are recognized and derecognized on the trade date.Regular way purchases or sales of financial assets refer to deliveries of financial assets within the time frame established by regulation or market convention according to contract terms. Trade date refers to the date on which the Company commits to purchase or sell a financial asset. (2) Classification and measurement of financial assets At initial recognition based on the business model for managing financial assets and the contractual cash flow characteristics of financial assets the Company classifies financial assets into: financial assets measured at amortized cost financial assets measured at fair value through profit or loss (FVTPL) and financial assets measured at fair value through other comprehensive income (FVOCI). Unless the Company changes its business model for managing financial assets in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in business model financial assets shall not be reclassified after initial recognition.Financial assets are measured at fair value at initial recognition. For financial assets measured at FVTPL relevant transaction costs are directly recognized in profit or loss; for other categories of financial assets relevant transaction costs are included in their initial recognition amounts. Notes receivable and accounts receivable arising from the sale of goods or rendering of services that do not contain or consider significant financing components are initially measured at the transaction price defined in the revenue standard.Subsequent measurement of financial assets depends on their classification: * Financial assets measured at amortized cost Financial assets meeting both of the following conditions are classified as financial assets measured at amortized cost: the Company manages the financial assets under a business model whose objective is to collect contractual cash flows; the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding (SPPI). For such financial assets the effective interest method is used for subsequent measurement at amortized cost. Gains or losses arising from derecognition amortization using the effective interest method or impairment are recognized in profit or loss.* Financial assets measured at fair value through other comprehensive income (FVOCI) Financial assets meeting both of the following conditions are classified as financial assets measured at FVOCI: the Company manages the financial assets under a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding (SPPI). For such financial assets subsequent measurement is performed at fair value. Except for impairment losses or gains and exchange differences recognized in profit or loss fair value changes of such financial assets are recognized in other comprehensive income until the financial asset is derecognized whereupon its cumulative gains or losses are transferred to profit or loss. However interest income calculated using the effective interest method is recognized in profit or loss.The Company irrevocably designates certain non-trading equity instrument investments as financial assets measured at FVOCI; only relevant dividend income is recognized in profit or loss while fair value changes are recognized in other comprehensive income and cumulative gains or losses are transferred to retained earnings upon derecognition.* Financial assets measured at fair value through profit or loss (FVTPL) Financial assets other than those measured at amortized cost and FVOCI are classified as financial assets measured at FVTPL. For such financial assets subsequent measurement is performed at fair value and all fair value changes are recognized in profit or loss. (3) Classification and measurement of financial liabilities 67FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) The Company classifies financial liabilities into: financial liabilities measured at FVTPL loan commitments for below-market-rate loans and financial guarantee contract liabilities and financial liabilities measured at amortized cost.Subsequent measurement of financial liabilities depends on their classification: * Financial liabilities measured at fair value through profit or loss (FVTPL) Such financial liabilities include trading financial liabilities (including derivatives classified as financial liabilities) and financial liabilities designated as measured at FVTPL. After initial recognition such financial liabilities are subsequently measured at fair value; except for those related to hedge accounting gains or losses (including interest expense) are recognized in profit or loss. However for financial liabilities designated as measured at FVTPL the amount of change in fair value caused by changes in the Company's own credit risk is recognized in other comprehensive income; upon derecognition cumulative gains or losses previously recognized in other comprehensive income are transferred to retained earnings.* Loan commitments and financial guarantee contract liabilities A loan commitment is a commitment provided by the Company to a customer to provide a loan under predetermined contractual terms within the commitment period. Impairment losses for loan commitments are accrued according to the expected credit loss model.A financial guarantee contract refers to a contract that requires the Company to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with the terms of a debt instrument. Financial guarantee contract liabilities are subsequently measured at the higher of the loss allowance determined in accordance with financial instrument impairment principles and the initial recognition amount less cumulative amortization recognized under revenue principles.* Financial liabilities measured at amortized cost After initial recognition other financial liabilities are measured at amortized cost using the effective interest method.Except in special circumstances financial liabilities and equity instruments are distinguished according to the following principles: * If the Company cannot unconditionally avoid delivering cash or another financial asset to settle a contractual obligation the contractual obligation meets the definition of a financial liability. Although some financial instruments do not explicitly contain terms and conditions requiring delivery of cash or another financial asset they may indirectly create contractual obligations through other terms and conditions.* If a financial instrument will or may be settled in the Company's own equity instruments it is necessary to consider whether the Company's equity instruments used to settle the instrument are used as substitutes for cash or other financial assets or to enable the holder to enjoy the residual interest in the issuer's assets after deducting all liabilities. If the former the instrument is a financial liability of the issuer; if the latter the instrument is an equity instrument of the issuer. Under certain circumstances where a contract requires or allows the Company to settle a financial instrument with its own equity instruments and the contractual right or obligation amount equals the quantity of equity instruments to be received or delivered multiplied by their fair value at settlement the contract is classified as a financial liability regardless of whether the amount is fixed or varies based on variables other than the market price of the Company's own equity instruments (e.g. interest rate commodity price or financial instrument price). (4) Derivative financial instruments and embedded derivatives Derivative financial instruments are initially measured at fair value on the date the derivative contract is signed and subsequently measured at fair value. A derivative financial instrument with a positive fair value is recognized as an asset and one with a negative fair value is recognized as a liability. 68FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Gains or losses arising from changes in the fair value of derivatives are directly recognized in profit or loss except for the effective portion of cash flow hedges which is recognized in other comprehensive income and reclassified into profit or loss when the hedged item affects profit or loss.For hybrid instruments containing embedded derivatives if the host contract is a financial asset the hybrid instrument as a whole applies the classification rules for financial assets. If the host contract is not a financial asset and the hybrid instrument is not accounted for at FVTPL an embedded derivative is bifurcated from the host contract and treated as a standalone derivative if its economic characteristics and risks are not closely related to those of the host contract and a separate instrument with the same terms as the embedded derivative would meet the definition of a derivative. If the fair value of the embedded derivative cannot be measured reliably on the acquisition date or subsequent balance sheet dates the hybrid instrument as a whole is designated as a financial asset or financial liability at FVTPL. (5) Impairment of financial instruments The Company recognizes loss allowances on the basis of expected credit losses (ECL) for financial assets measured at amortized cost debt investments measured at FVOCI contract assets lease receivables loan commitments and financial guarantee contracts.* Measurement of expected credit losses Expected credit losses refer to the weighted average of credit losses of financial instruments weighted by the risk of default. Credit loss refers to the difference between all contractual cash flows receivable under the contract and all cash flows expected to be received discounted at the original effective interest rate—namely the present value of all cash shortfalls. Among them for purchased or originated credit-impaired (POCI) financial assets discounting is performed using the credit-adjusted effective interest rate.Lifetime expected credit losses refer to the expected credit losses that result from all possible default events over the expected life of a financial instrument. 12-month expected credit losses refer to the portion of lifetime expected credit losses that result from default events on a financial instrument that are possible within 12 months after the balance sheet date (or the expected life if less than 12 months).At each balance sheet date the Company measures expected credit losses for financial instruments at different stages. Where credit risk has not increased significantly since initial recognition the instrument is in Stage 1 and the loss allowance is measured at an amount equal to 12-month ECL; where credit risk has increased significantly since initial recognition but is not credit-impaired the instrument is in Stage 2 and the loss allowance is measured at an amount equal to lifetime ECL; where the financial instrument is credit-impaired since initial recognition the instrument is in Stage 3 and the loss allowance is measured at an amount equal to lifetime ECL.For financial instruments with low credit risk at the balance sheet date the Company assumes that credit risk has not increased significantly since initial recognition and measures the loss allowance at an amount equal to 12-month ECL.For financial instruments in Stage 1 Stage 2 and those with low credit risk interest income is calculated based on the gross carrying amount (without deducting impairment allowance) and the effective interest rate. For financial instruments in Stage 3 interest income is calculated based on the amortized cost (gross carrying amount less impairment allowance) and the effective interest rate.For notes receivable and accounts receivable whether containing a significant financing component or not the Company always measures the loss allowance at an amount equal to lifetime ECL.A. Receivables For notes receivable accounts receivable and other receivables with objective evidence of impairment or applicable for individual assessment individual impairment tests are conducted to recognize ECL and accrue 69FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) individual impairment allowances. For notes receivable accounts receivable and other receivables without objective evidence of impairment or when information on ECL cannot be assessed at a reasonable cost for an individual asset the Company groups them into portfolios based on credit risk characteristics and calculates ECL on a collective basis.The basis for determining portfolios is as follows: Basis for determining portfolios of notes receivable: Notes receivable portfolio 1: Commercial acceptance bills Notes receivable portfolio 2: Bank acceptance bills For notes receivable categorized into portfolios the Company calculates ECL based on exposure at default and the lifetime ECL rate referencing historical credit loss experience combined with current conditions and forecasts of future economic conditions.Basis for determining portfolios of accounts receivable: Accounts receivable portfolio 1: Receivables from customers For accounts receivable categorized into portfolios the Company prepares an aging schedule and lifetime ECL rate matrix to calculate ECL referencing historical credit loss experience current conditions and forecasts of future economic conditions.Basis for determining portfolios of other receivables: Other receivables portfolio 1: Deposits and security deposits receivable Other receivables portfolio 2: Employee petty cash receivable Other receivables portfolio 3: Other receivables For other receivables categorized into portfolios the Company calculates ECL based on exposure at default and the 12-month or lifetime ECL rate referencing historical credit loss experience current conditions and forecasts of future economic conditions.The aging calculation method for determining credit risk characteristic portfolios is: aging for notes receivable accounts receivable and other receivables is determined from the booking date to the balance sheet date.B. Debt investments other debt investments For debt investments and other debt investments the Company calculates ECL based on the nature of the investment counterparties and types of exposures using exposure at default and the 12-month or lifetime ECL rate.* Low credit risk A financial instrument is deemed to have low credit risk if the default risk is low the borrower has a strong capacity to meet its contractual cash flow obligations in the short term and adverse changes in economic and business conditions in the longer term will not necessarily reduce the borrower's ability to fulfill its contractual cash flow obligations.* Significant increase in credit risk The Company assesses whether credit risk has increased significantly since initial recognition by comparing the probability of default over the expected life of the financial instrument at the balance sheet date with that determined at initial recognition to determine the relative change in default probability.In determining whether credit risk has increased significantly since initial recognition the Company considers reasonable and supportable information available without undue cost or effort including forward-looking information.Information considered by the Company includes: A. Significant changes in internal price indicators resulting from changes in credit risk; B. Adverse changes in business financial or economic conditions that are expected to cause a significant change in the debtor's ability to meet its debt obligations; C. Actual or expected significant changes in the operating results of the debtor; Significant adverse changes in the regulatory economic or technological environment of the debtor; 70FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) D. Significant changes in the value of collateral supporting the obligation or in the quality of third-party guarantees or credit enhancements. These changes are expected to reduce the debtor's economic incentive to pay within contractual terms or affect the probability of default; E. Significant changes in the expected economic incentive of the debtor to make repayments according to the contractual terms; F. Expected changes in loan contracts including whether anticipated contractual breaches might lead to covenant waivers or amendments grace periods interest rate step-ups collateral/guarantee additions or other changes to the contractual framework; G. Significant changes in the expected performance and payment behavior of the debtor; H. Whether contractual payments are overdue for more than (inclusive of) 30 days.Depending on the nature of the financial instruments the Company evaluates whether credit risk has increased significantly on an individual basis or a collective basis. When evaluated on a portfolio basis financial instruments may be grouped based on shared credit risk characteristics such as delinquency information and credit risk ratings.Generally if overdue for more than 30 days the Company determines that the credit risk of the financial instrument has increased significantly. Unless the Company can obtain reasonable and supportable information without undue cost or effort demonstrating that credit risk has not increased significantly since initial recognition despite being overdue for more than 30 days.* Credit-impaired financial assets The Company assesses at the balance sheet date whether financial assets measured at amortized cost and debt investments measured at FVOCI have become credit-impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.Evidence of credit impairment includes observable data about the following events: Significant financial difficulty of the issuer or debtor; A breach of contract by the debtor such as a default or delinquency in interest or principal payments; The creditor for economic or contractual reasons relating to the debtor's financial difficulty granting a concession that would not otherwise be considered; It becoming probable that the debtor will enter bankruptcy or other financial reorganization; The disappearance of an active market for that financial asset because of financial difficulties of the issuer or debtor; The purchase or origination of a financial asset at a deep discount that reflects incurred credit losses.* Presentation of ECL allowance To reflect changes in the credit risk of financial instruments since initial recognition the Company remeasures ECL at each balance sheet date. The resulting increase or reversal of the loss allowance is recognized in profit or loss as an impairment loss or gain. For financial assets measured at amortized cost the loss allowance offsets the carrying amount of the financial asset presented in the balance sheet; for debt investments measured at FVOCI the Company recognizes the loss allowance in other comprehensive income without reducing the carrying amount of the financial asset.* Write-off The Company writes down the gross carrying amount of a financial asset directly when it no longer has a reasonable expectation of recovering the contractual cash flows in whole or in part. Such a write-down constitutes a derecognition of the related financial asset. This usually occurs when the Company determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amount subject to write-off.Subsequent recoveries of financial assets previously written off are recognized in profit or loss in the period of recovery as a reversal of impairment loss. (6) Transfer of financial assets Transfer of financial assets refers to the following two scenarios: 71FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) A. Transferring the contractual rights to receive cash flows from the financial asset to another party; B. Transferring the financial asset in whole or in part to another party while retaining the contractual rights to receive cash flows but assuming a contractual obligation to pay those cash flows to one or more recipients.* Derecognition of transferred financial assets A financial asset is derecognized if the Company has transferred substantially all the risks and rewards of ownership of the financial asset to the transferee or has neither transferred nor retained substantially all the risks and rewards of ownership but has relinquished control over the financial asset.In determining whether control over the transferred financial asset has been relinquished focus is placed on the transferee's practical ability to sell the financial asset. If the transferee has the practical ability to sell the transferred financial asset in its entirety to an unrelated third party without attaching additional restrictions the Company has relinquished control over the asset.The Company focuses on the substance of financial asset transfers when judging whether derecognition criteria are met.If a transfer of an entire financial asset satisfies the conditions for derecognition the difference between the following two amounts is recognized in profit or loss: A. The carrying amount of the transferred financial asset; B. The sum of consideration received from the transfer and the cumulative amount of fair value changes previously recognized directly in other comprehensive income corresponding to the derecognized part (where the transferred financial asset is classified as measured at FVOCI under Article 18 of CAS 22 - Recognition and Measurement of Financial Instruments).If a partial transfer of a financial asset satisfies the derecognition conditions the total carrying amount of the transferred asset is allocated between the derecognized part and the retained part (where retained servicing assets are treated as part of the continuing financial asset) based on their relative fair values on the transfer date with the difference between the following two amounts recognized in profit or loss: A. The carrying amount of the derecognized part on the derecognition date; B. The sum of consideration received for the derecognized part and the cumulative amount of fair value changes previously recognized in other comprehensive income corresponding to the derecognized part (where the transferred asset is classified as measured at FVOCI under Article 18 of CAS 22).* Continuing involvement in transferred financial assets If the Company neither transfers nor retains substantially all the risks and rewards of ownership and has not relinquished control it recognizes the financial asset to the extent of its continuing involvement and recognizes an associated liability accordingly.The extent of continuing involvement refers to the extent to which the enterprise is exposed to changes in the value of the transferred financial asset.* Continued recognition of transferred financial assets If the Company retains substantially all the risks and rewards of ownership of the transferred financial asset it continues to recognize the entire financial asset and recognizes the consideration received as a financial liability.The financial asset and the recognized associated liability shall not be offset. In subsequent accounting periods the enterprise continues to recognize income (or gains) arising from the asset and expenses (or losses) incurred on the liability. (7) Offsetting of financial assets and financial liabilities Financial assets and financial liabilities shall be presented separately in the balance sheet and shall not be offset.However they are presented on a net basis in the balance sheet if both of the following conditions are met: 72FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) The Company has a legally enforceable right to set off the recognized amounts and such legal right is currently enforceable; The Company plans to settle on a net basis or to realize the financial asset and settle the financial liability simultaneously.For transfers of financial assets that do not meet derecognition conditions the transferor shall not offset the transferred financial asset and the related liability. 12. Notes Receivable Basis for determining portfolios of notes receivable: Notes receivable portfolio 1: Commercial acceptance bills Notes receivable portfolio 2: Bank acceptance bills For notes receivable categorized into portfolios the Company calculates ECL based on exposure at default and the lifetime ECL rate referencing historical credit loss experience combined with current conditions and forecasts of future economic conditions. 13. Accounts Receivable Basis for determining portfolios of accounts receivable: Accounts receivable portfolio 1: Receivables from customers For accounts receivable categorized into portfolios the Company prepares an aging schedule and lifetime ECL rate matrix to calculate ECL referencing historical credit loss experience current conditions and forecasts of future economic conditions. 14. Receivables Financing Not applicable 15. Other Receivables Method for Determining Expected Credit Losses and Accounting Treatment of Other Receivables Basis for determining portfolios of other receivables: Other receivables portfolio 1: Deposits and security deposits receivable Other receivables portfolio 2: Employee petty cash receivable Other receivables portfolio 3: Other receivables For other receivables categorized into portfolios the Company calculates ECL based on exposure at default and the 12-month or lifetime ECL rate referencing historical credit loss experience current conditions and forecasts of future economic conditions. 16. Contract Assets The Company presents contract assets or contract liabilities in the balance sheet based on the relationship between the fulfillment of performance obligations and customer payments. The Company's right to consideration for goods or services transferred to customers (where such right depends on factors other than the passage of time) is 73FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) presented as contract assets. The Company's obligation to transfer goods or services to customers for consideration received or receivable from customers is presented as contract liabilities.For the method of determining expected credit losses and accounting treatment of contract assets please refer to Note V.11.Contract assets and contract liabilities are presented separately in the balance sheet. Contract assets and contract liabilities under the same contract are presented on a net basis. If the net amount is a debit balance it is presented under "Contract assets" or "Other non-current assets" based on its liquidity; if the net amount is a credit balance it is presented under "Contract liabilities" or "Other non-current liabilities" based on its liquidity. Contract assets and contract liabilities under different contracts cannot be offset against each other. 17. Inventories (1) Classification of inventories Inventories refer to finished goods or commodities held for sale in the ordinary course of business work in progress in the production process and materials and supplies consumed in the production process or rendering of services including raw materials work in progress and finished goods (merchandise inventories). (2) Valuation method for delivered inventories The weighted average method is used upon delivery of raw materials and merchandise inventory (excluding luxury brand watches) while the specific identification method is used for luxury brand watch inventories. (3) Inventory system The Company adopts a perpetual inventory system and conducts physical counts at least once a year. Inventory surpluses and shortages are recognized in current profit or loss. (4) Recognition criteria and provision method for inventory write-downs Inventories are measured at the lower of cost and net realizable value at the balance sheet date. If the cost exceeds net realizable value an inventory write-down provision is recognized in profit or loss.In determining net realizable value reliable evidence obtained is taken as the basis taking into account the purpose of holding inventories the impact of post-balance sheet events and other factors.* For inventories directly held for sale such as finished goods merchandise and materials for sale net realizable value is determined in the ordinary course of business by the estimated selling price less estimated selling expenses and related taxes. For inventories held to satisfy sales contracts or service contracts the contract price serves as the basis for calculating net realizable value; if the quantity held exceeds the order quantity in the sales contract the net realizable value of the excess is based on general selling prices. For materials held for sale market prices serve as the basis for calculating net realizable value.* For material inventories requiring processing net realizable value is determined in the ordinary course of business by the estimated selling price of finished products less estimated costs to completion estimated selling expenses and related taxes. If the net realizable value of the finished products produced from the materials exceeds cost the materials are measured at cost; if a decline in material prices indicates that the net realizable value of finished products is below cost the materials are measured at net realizable value and an inventory write-down provision is accrued for the difference.* The Company generally accrues inventory write-down provisions on an individual inventory item basis; for inventories with large quantities and low unit prices provisions are accrued by inventory category.* If the factors causing previous write-downs of inventory value no longer exist at the balance sheet date the written-down amount is restored and reversed within the original inventory write-down provision with the reversed amount recognized in current profit or loss. 74FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 18. Assets Held for Sale Not applicable 19. Debt Investments Not applicable 20. Other Debt Investments Not applicable 21. Long-Term Receivables Not applicable 22. Long-Term Equity Investments The Company's long-term equity investments include equity investments where it exercises control or significant influence over investees. An investee over which the Company can exert significant influence is an associate of the Company. (1) Basis for determining significant influence over investees Significant influence refers to the power to participate in the financial and operating policy decisions of the investee but without control or joint control over the formulation of those policies. In determining significant influence consideration is given to the voting shares held directly or indirectly by the investor in the investee as well as the effect of currently exercisable potential voting rights held by the investor and other parties assumed to be converted into equity including warrants share options and convertible corporate bonds issued by the investee.When the Company directly or indirectly holds 20% or more (inclusive) but less than 50% of the voting shares of an investee it is generally considered to have significant influence unless there is clear evidence indicating that it cannot participate in operating decisions and thus does not exert significant influence. (2) Determination of initial investment cost * For long-term equity investments formed through business combinations investment cost is determined as follows: A. In a business combination under common control where consideration is paid in cash transfer of non-cash assets or assumption of debt the initial investment cost is the share of carrying amount of the combinee's owners' equity in the consolidated financial statements of the ultimate controlling party on the merger date. Any difference between the initial investment cost and the carrying amount of cash paid non-cash assets transferred and debts assumed is adjusted against capital reserve; if capital reserve is insufficient it is adjusted against retained earnings; B. In a business combination under common control where equity securities are issued as combination consideration the initial investment cost is the share of carrying amount of the combinee's owners' equity in the consolidated financial statements of the ultimate controlling party on the merger date. The aggregate par value of shares issued is recognized as share capital; the difference between the initial investment cost and the aggregate par value is adjusted against capital reserve; if capital reserve is insufficient it is adjusted against retained earnings; C. In a business combination not under common control the combination cost—determined as the fair value of assets given liabilities incurred or assumed and equity securities issued on the acquisition date to gain control—is 75FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) recognized as the initial investment cost. Intermediary fees such as auditing legal services valuation and consulting fees and other related administrative expenses incurred by the acquirer for business combinations are recognized in profit or loss when incurred.* For long-term equity investments acquired other than through business combinations investment cost is determined as follows: A. For long-term equity investments acquired by cash payment the actual purchase price paid is recognized as the investment cost. Initial investment cost includes expenses taxes and other necessary expenditures directly related to the acquisition; B. For long-term equity investments acquired by issuing equity securities the fair value of the issued equity securities is recognized as the initial investment cost; C. For long-term equity investments acquired through non-monetary asset exchanges if the exchange has commercial substance and the fair value of the asset received or surrendered can be measured reliably the initial cost is based on the fair value of the surrendered asset plus related taxes with any difference between fair value and book value recognized in profit or loss; if both conditions are not met the carrying amount of the surrendered asset plus related taxes is recognized as the initial investment cost.D. For long-term equity investments acquired through debt restructuring the initial carrying amount is based on the fair value of claims waived and directly attributable taxes and other costs with the difference between the fair value and carrying amount of waived claims recognized in profit or loss. (3) Subsequent measurement and recognition of profit or loss Long-term equity investments where the Company can exercise control over investees are accounted for using the cost method; long-term equity investments in associates are accounted for using the equity method.* Cost method For long-term equity investments accounted for using the cost method the cost is adjusted when adding or recovering investments; cash dividends or profits declared by the investee are recognized as current investment income.* Equity method For long-term equity investments accounted for under the equity method general accounting treatments are: If the initial investment cost exceeds the Company's share of the fair value of the investee's identifiable net assets at acquisition the initial cost is not adjusted; if the initial investment cost is less than the Company's share of the fair value of the investee's identifiable net assets at acquisition the difference is recognized in profit or loss and the cost of the investment is adjusted accordingly.The Company recognizes investment income and other comprehensive income based on its share of net profit/loss and other comprehensive income realized by the investee while adjusting the carrying amount of the long- term equity investment; the carrying amount of the investment is reduced by the Company's share of profits or cash dividends declared by the investee; for changes in owners' equity of the investee other than net profit or loss other comprehensive income and profit distribution the carrying amount is adjusted and recognized in owners' equity. In recognizing its share of the investee's net profit/loss net profit is adjusted based on the fair value of the investee's identifiable net assets upon acquisition. If accounting policies and periods of the investee differ from those of the Company the financial statements of the investee are adjusted to conform to the Company's accounting policies and periods before recognizing investment income and other comprehensive income. Unrealized profits and losses from internal transactions between the Company and its associates/joint ventures are eliminated in proportion to the share attributable to the Company upon which investment gains/losses are recognized. Where unrealized internal transaction losses between the Company and investees represent asset impairment losses they are recognized in full. 76FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Where significant influence or joint control (without control) over an investee is obtained due to additional investments the initial cost under the equity method is the sum of the fair value of previously held equity plus new investment costs. If the previously held equity investment was classified as an investment in other equity instruments the difference between fair value and carrying amount along with cumulative gains or losses previously recognized in OCI is transferred to retained earnings in the period of adopting the equity method.Upon loss of joint control or significant influence due to partial disposal of equity the remaining equity is measured at fair value with the difference between its fair value and carrying amount on the date of losing joint control or significant influence recognized in profit or loss. Other comprehensive income recognized under the equity method is accounted for on the same basis as would be required if the investee had directly disposed of the related assets or liabilities upon discontinuing the equity method. (4) Impairment test method and provision for impairment For methods of accruing asset impairment for investments in subsidiaries and associates please refer to Note V.30. 23. Investment Properties Measurement Model for Investment Properties Cost model measurement Depreciation or Amortization Method (1) Classification of investment properties Investment property refers to real estate held to earn rentals for capital appreciation or both. It primarily includes: * Land use rights leased out.* Land use rights held and intended to be transferred after appreciation.* Buildings leased out. (2) Measurement model for investment properties The Company adopts the cost model for subsequent measurement of investment properties; for the impairment provision method please refer to Note V.30.The Company calculates depreciation or amortization on a straight-line basis based on cost less accumulated impairment and net residual value. The depreciation periods and annual depreciation rates determined by category estimated useful life and estimated net residual value rate are as follows: Category Depreciation Period (Years)Residual Value Rate (%)Annual Depreciation Rate (%) Buildings and structures 20-35 5.00 2.71-4.85 24. Fixed Assets (1) Recognition criteria Fixed assets are recognized at actual cost upon acquisition when both of the following conditions are met: * It is probable that economic benefits associated with the fixed asset will flow to the enterprise.* The cost of the fixed asset can be reliably measured.Subsequent expenditures incurred on fixed assets meeting recognition criteria are included in the cost of fixed assets; those not meeting recognition criteria are recognized in profit or loss when incurred. 77FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (2) Depreciation methods Category Depreciation Method Depreciation Period Residual Value Rate Annual DepreciationRate Buildings and structures Straight-line method 20-35 5% 2.71%-4.85% Machinery and equipment Straight-line method 10 5%-10% 9%-9.5% Electronic equipment Straight-line method 5 5% 19% Transportation equipment Straight-line method 5 5% 19% Other equipment Straight-line method 5 5% 19% The Company accrues depreciation using the straight-line method starting from the month following the date the fixed asset reaches its intended usable state determining depreciation periods and annual rates by category estimated useful life and estimated net residual value rate.For fixed assets with impairment provisions accrued the accumulated impairment provision is deducted when calculating depreciation.At each year-end the Company reviews the useful life estimated net residual value and depreciation method of fixed assets. If the estimated useful life differs from previous estimates the useful life of the fixed asset is adjusted. 25. Construction in Progress (1) Construction in progress is accounted for separately by approved project. (2) Criteria and timing for transferring construction in progress to fixed assets The carrying amount of fixed assets transferred from construction in progress comprises all expenditures incurred before the asset reaches its intended usable state. This includes construction costs original cost of machinery and equipment other necessary expenses incurred to bring the project to its intended usable state as well as borrowing costs on specific borrowings and general borrowings incurred before reaching the intended usable state. The Company transfers construction in progress to fixed assets upon installation or construction completion reaching the intended usable state. Fixed assets constructed that have reached the intended usable state but have not yet finalized final accounts of completed projects are transferred to fixed assets based on estimated values derived from project budgets construction costs or actual costs and depreciated according to the Company's depreciation policy from the date of reaching usable state. Upon finalization of final accounts the estimated value is adjusted to actual cost while previously accrued depreciation is not adjusted. 26. Borrowing Costs (1) Recognition principles and capitalization period for borrowing costs Borrowing costs directly attributable to the acquisition construction or production of qualifying assets are capitalized as part of the asset cost when all of the following conditions are met: * Asset expenditures have been incurred; * Borrowing costs have been incurred; * Acquisition construction or production activities necessary to prepare the asset for its intended use or sale have commenced.Other borrowing interest discount or premium amortization and exchange differences are recognized in current profit or loss. 78FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) If the acquisition construction or production of a qualifying asset is interrupted abnormally and the interruption lasts continuously for more than 3 months capitalization of borrowing costs is suspended.Capitalization of borrowing costs ceases when the qualifying asset reaches its intended usable or salable state; subsequent borrowing costs are recognized as expenses in the period incurred. (2) Calculation method of capitalization rate and capitalization amount of borrowing costs For specific borrowings borrowed for the acquisition construction or production of qualifying assets the capitalization amount is the actual interest expense incurred on the specific borrowings during the period less interest income from unutilized funds deposited in banks or investment income from temporary investments.Where general borrowings are utilized for the acquisition construction or production of qualifying assets the interest amount to be capitalized on general borrowings is determined by multiplying the weighted average of accumulated asset expenditures exceeding specific borrowings by the capitalization rate of the general borrowings utilized. The capitalization rate is calculated and determined based on the weighted average interest rate of general borrowings. 27. Biological Assets Not applicable 28. Oil and Gas Assets Not applicable 29. Intangible Assets (1) Useful life determination basis estimation amortization method or review procedures 1) Valuation method of intangible assets Recorded at actual cost upon acquisition. 2) Useful life and amortization of intangible assets * Estimation of useful life for intangible assets with finite useful lives: Item Estimated UsefulLife Basis Land use rights 50 years Statutory rights of use Software Determined with reference to the period generating economic benefits for the systems 5 years Company Trademark 5-10 years Determined with reference to the period generating economic benefits for therights Company At each year-end the Company reviews the useful life and amortization method of intangible assets with finite useful lives. Upon review the useful lives and amortization methods of intangible assets at the end of the period showed no difference from previous estimates.* Intangible assets whose period of bringing economic benefits to the enterprise is unforeseeable are regarded as intangible assets with indefinite useful lives. For intangible assets with indefinite useful lives the Company reviews their useful lives at each year-end; if still determined as indefinite upon review impairment tests are conducted at the balance sheet date.* Amortization of intangible assets For intangible assets with finite useful lives the Company determines their useful lives upon acquisition and amortizes them systematically and rationally over their useful lives using the straight-line method with the amortization 79FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) amount recognized in current profit or loss or included in the cost of related assets based on beneficiary items. The amortizable amount is its cost less estimated residual value. For intangible assets with impairment provisions accrued the accumulated impairment provision is also deducted. The residual value of an intangible asset with a finite useful life is treated as zero unless: a third party has committed to purchase the asset at the end of its useful life or estimated residual value information can be obtained from an active market that is likely to exist at the end of its useful life.Intangible assets with indefinite useful lives are not amortized. At each year-end the useful lives of intangible assets with indefinite useful lives are reviewed; if evidence indicates that the useful life is finite the useful life is estimated and amortized systematically and rationally over the estimated useful life. (2) Scope of R&D expenditure collection and related accounting treatments 1) Scope of R&D expenditure collection The Company collects expenses directly related to R&D activities as R&D expenditures including employee compensation for R&D personnel direct input costs depreciation expenses and long-term prepaid expenses design fees equipment commissioning fees amortization of intangible assets outsourced R&D fees other expenses etc. 2) Criteria for distinguishing research stage and development stage of internal R&D projects * The Company treats data collection and preparatory activities for further development as the research stage; expenditures in the research stage are recognized in profit or loss when incurred.* Development activities conducted after the completion of the research stage are treated as the development stage. 3) Specific conditions for capitalizing development stage expenditures Expenditures during the development stage are recognized as intangible assets only when all of the following conditions are met: A. It is technically feasible to complete the intangible asset so that it will be available for use or sale; B. There is an intention to complete the intangible asset and use or sell it; C. The manner in which the intangible asset will generate economic benefits including demonstrating the existence of a market for the output of the intangible asset or the intangible asset itself or if it is to be used internally the usefulness of the intangible asset; D. Availability of adequate technical financial and other resources to complete the development and to use or sell the intangible asset; E. Ability to measure reliably the expenditure attributable to the intangible asset during its development stage. 30. Impairment of Long-Term Assets Impairment of long-term equity investments in subsidiaries and associates investment properties measured under the cost model fixed assets construction in progress right-of-use assets and intangible assets is determined as follows: The Company assesses at the balance sheet date whether there are indications of asset impairment; if any such indication exists the Company estimates the recoverable amount and conducts impairment tests. Goodwill arising from business combinations intangible assets with indefinite useful lives and intangible assets not yet ready for use are tested for impairment annually regardless of whether there is any indication of impairment.The recoverable amount is determined at the higher of the asset's fair value less costs of disposal and the present value of the estimated future cash flows of the asset. The Company estimates the recoverable amount on an individual asset basis; if it is difficult to estimate the recoverable amount of an individual asset the recoverable amount of the 80FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) asset group to which the asset belongs is determined. An asset group is identified based on whether major cash inflows generated by the asset group are largely independent of cash inflows from other assets or asset groups.When the recoverable amount of an asset or asset group is lower than its carrying amount the Company writes down its carrying amount to the recoverable amount recognizing the write-down in profit or loss and accruing a corresponding asset impairment provision.In impairment testing if there is an indication of impairment for an asset group or combination of asset groups related to goodwill an impairment test is first performed on the asset group or combination excluding goodwill to calculate the recoverable amount and recognize corresponding impairment loss. Subsequently an impairment test is performed on the asset group or combination including goodwill by comparing its carrying amount with its recoverable amount; if the recoverable amount is lower than the carrying amount an impairment loss for goodwill is recognized.Once recognized asset impairment losses shall not be reversed in subsequent accounting periods. 31. Long-Term Prepaid Expenses Long-term prepaid expenses account for expenditures already incurred with an amortization period exceeding one year to be borne by the current and subsequent periods and are amortized evenly over the benefit period. 32. Contract Liabilities The Company presents contract assets or contract liabilities in the balance sheet based on the relationship between the fulfillment of performance obligations and customer payments. The Company's right to consideration for goods or services transferred to customers (where such right depends on factors other than the passage of time) is presented as contract assets. The Company's obligation to transfer goods or services to customers for consideration received or receivable from customers is presented as contract liabilities.For the method of determining expected credit losses and accounting treatment of contract assets please refer to Note V.11.Contract assets and contract liabilities are presented separately in the balance sheet. Contract assets and contract liabilities under the same contract are presented on a net basis. If the net amount is a debit balance it is presented under "Contract assets" or "Other non-current assets" based on its liquidity; if the net amount is a credit balance it is presented under "Contract liabilities" or "Other non-current liabilities" based on its liquidity. Contract assets and contract liabilities under different contracts cannot be offset against each other. 33. Employee Benefits (1) Accounting treatment of short-term employee benefits * Basic employee compensation (salaries bonuses allowances subsidies) During the accounting period in which employees render services the Company recognizes short-term employee benefits actually incurred as liabilities and in current profit or loss unless other accounting standards require or permit inclusion in asset costs.* Employee welfare expenses Employee welfare expenses incurred by the Company are recognized in current profit or loss or related asset costs based on actual amounts when incurred. Non-monetary employee benefits are measured at fair value.* Social insurances such as medical work-related injury and maternity insurance housing provident funds trade union funds and employee education funds 81FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Social insurances (medical work-related injury maternity insurance) housing provident funds trade union funds and employee education funds paid by the Company are calculated and recognized as liabilities and in profit or loss or asset costs during the service period based on statutory accrual bases and proportions.* Short-term paid absences The Company recognizes employee benefits related to accumulating paid absences when employees render services that increase their entitlement to future paid absences measuring them at the additional amount expected to be paid as a result of unused entitlements. Employee benefits related to non-accumulating paid absences are recognized in the accounting period in which absences actually occur.* Short-term profit-sharing plans The Company recognizes relevant employee benefits payable under a profit-sharing plan when all of the following conditions are met: A. The enterprise has a present legal or constructive obligation to make payments as a result of past events; B. The amount of obligation under the profit-sharing plan can be reliably estimated. (2) Accounting treatment of post-employment benefits * Defined contribution plans During the accounting period in which employees render services the Company recognizes the payable contribution calculated under the defined contribution plan as a liability and in current profit or loss or asset costs.If contributions are not expected to be settled wholly before twelve months after the end of the reporting period in which employees render the related service the Company discounts the total contributions payable to present value (using discount rates matched to government bonds or high-quality corporate bonds) to measure employee benefits payable.* Defined benefit plans A. Determining the present value of defined benefit obligations and current service cost Using the projected unit credit method unbiased and mutually compatible actuarial assumptions are applied to estimate demographic and financial variables measuring obligations under defined benefit plans and attributing benefits to periods of service. Obligations under defined benefit plans are discounted at market yields of government bonds or high-quality corporate bonds at the balance sheet date to determine the present value of obligations and current service cost.B. Recognizing net defined benefit liability or asset When plan assets exist the deficit or surplus resulting from the present value of defined benefit obligations less the fair value of plan assets is recognized as a net defined benefit liability or net asset.If a surplus exists the net defined benefit asset is measured at the lower of the surplus in the defined benefit plan and the asset ceiling.C. Determining amounts recognized in asset costs or profit or loss Service cost comprises current service cost past service cost and gains or losses on settlement. Except for current service costs permitted or required by other standards to be included in asset costs service costs are recognized in profit or loss.Net interest on the net defined benefit liability (asset) comprising interest income on plan assets interest cost on defined benefit obligations and interest on the effect of the asset ceiling is recognized in profit or loss.D. Determining amounts recognized in other comprehensive income Remeasurements of the net defined benefit liability (asset) comprise: (a) Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions; (b) Return on plan assets excluding amounts included in net interest on the net defined benefit liability (asset); 82FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (c) Changes in the effect of the asset ceiling excluding amounts included in net interest on the net defined benefit liability (asset).Such remeasurements are recognized directly in other comprehensive income and are not reclassified to profit or loss in subsequent periods; upon termination of the plan all amounts previously recognized in OCI are transferred to undistributed profits within equity. (3) Accounting treatment of termination benefits The Company recognizes a liability and expense for termination benefits at the earlier of the following dates: * When the enterprise can no longer unilaterally withdraw the offer of those benefits; * When the enterprise recognizes costs for a restructuring that involves the payment of termination benefits.If termination benefits are not expected to be settled wholly within twelve months after the end of the annual reporting period they are discounted at market yields of matched bonds to measure employee benefits payable. (4) Accounting treatment of other long-term employee benefits * Meeting criteria for defined contribution plans Where other long-term employee benefits meet the criteria of defined contribution plans employee benefits payable are measured at discounted total contributions payable.* Meeting criteria for defined benefit plans At the end of the reporting period the Company recognizes employee benefit costs arising from other long-term employee benefits as the following components: A. Service cost; B. Net interest on the net liability (asset) of other long-term employee benefits; C. Changes from remeasurement of the net liability (asset) of other long-term employee benefits.To simplify accounting treatments the net total of the above items is recognized in profit or loss or relevant asset costs. 34. Provisions (1) Recognition criteria for provisions The Company recognizes an obligation related to a contingency as a provision when all of the following conditions are met: * The obligation is a present obligation assumed by the Company; * It is probable that an outflow of economic benefits will be required to settle the obligation; * The amount of the obligation can be reliably measured. (2) Measurement method for provisions Provisions are initially measured at the best estimate of the expenditure required to settle the present obligation taking into account risks uncertainties and the time value of money related to contingencies. The carrying amount of provisions is reviewed at each balance sheet date. If there is clear evidence that the carrying amount does not reflect the current best estimate it is adjusted to the current best estimate. 35. Share-Based Payments (1) Types of share-based payments 83FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) The Company's share-based payments include cash-settled share-based payments and equity-settled share- based payments. (2) Determination of fair value of equity instruments * For shares granted to employees fair value is measured at the market price of the Company's shares adjusted for terms and conditions (excluding vesting conditions other than market conditions) upon which the shares were granted. * For share options granted to employees market prices are often unavailable. If no traded options with similar terms and conditions exist the Company selects an appropriate option pricing model to estimate the fair value of granted options. (3) Basis for determining the best estimate of exercisable equity instruments At each balance sheet date during the vesting period the Company makes best estimates based on newly obtained information such as changes in the number of vesting employees revising the number of equity instruments expected to vest. (4) Accounting treatment for implementation of share-based payment plans Cash-settled share-based payments * For cash-settled share-based payments immediately exercisable after grant the fair value of liabilities assumed by the Company is recognized in costs or expenses on the grant date with a corresponding increase in liabilities. The fair value of the liability is remeasured at each balance sheet date and settlement date before settlement with changes recognized in profit or loss.* For cash-settled share-based payments exercisable only after completing vesting services or meeting performance conditions services received are recognized in costs/expenses and liabilities at each balance sheet date during the vesting period based on the best estimate of vesting conditions and the fair value of liabilities assumed.Equity-settled share-based payments * For equity-settled share-based payments for employee services immediately exercisable after grant the fair value of equity instruments is recognized in costs/expenses on the grant date with a corresponding increase in capital reserve.* For equity-settled share-based payments for employee services exercisable only after completing vesting services or meeting performance conditions services received are recognized in costs/expenses and capital reserve at each balance sheet date during the vesting period based on the best estimate of vesting equity instruments at grant- date fair value. (5) Accounting treatment for modifications to share-based payment plans When the Company modifies a share-based payment plan if the modification increases the fair value of equity instruments granted the increase in services received is recognized based on the incremental fair value; if the modification increases the number of equity instruments granted the fair value of additional equity instruments is recognized as an increase in services received. Incremental fair value refers to the difference between the fair values of modified and original equity instruments on the modification date. If the modification reduces the total fair value of share-based payments or alters terms and conditions unfavorably to employees the Company continues to account for services received as if the modification had not occurred unless part or all of the granted instruments are canceled. (6) Accounting treatment for cancellations/terminations of share-based payment plans If granted equity instruments are canceled or settled during the vesting period (other than cancellations due to failure to meet vesting conditions) the Company: * Treats the cancellation or settlement as an acceleration of vesting and immediately recognizes the amount that otherwise would have been recognized over the remainder of the vesting period; * Treats all payments made to employees on cancellation or settlement as repurchases of equity interests recognizing any excess of payment over the fair value of equity instruments at repurchase date in current expenses. 84FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) If the Company repurchases vested equity instruments from employees it is deducted from owners' equity; any excess of payment over the fair value at repurchase date is recognized in profit or loss. 36. Preferred Shares Perpetual Bonds and Other Financial Instruments Not applicable 37. Revenue Disclosure of Accounting Policies for Revenue Recognition and Measurement by Business Type (1) General principles Revenue is the gross inflow of economic benefits arising in the course of the Company's ordinary activities that results in an increase in owners' equity other than contributions from equity holders.The Company recognizes revenue when performance obligations in a contract are satisfied i.e. when the customer obtains control of the relevant goods or services. Obtaining control over relevant goods or services means being able to direct the use of and obtain substantially all of the remaining economic benefits from the goods or services.If a contract contains two or more performance obligations the Company allocates the transaction price to each individual performance obligation at contract inception in proportion to the relative standalone selling prices of promised goods or services measuring revenue based on allocated transaction prices.The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring goods or services to customers excluding amounts collected on behalf of third parties. In determining transaction prices if variable consideration exists the Company determines the best estimate using the expected value or most likely amount including it in the transaction price only to the extent that it is highly probable that a significant reversal in cumulative revenue recognized will not occur when uncertainty is resolved. If a significant financing component exists in a contract the transaction price is determined based on the cash price that would have been paid upon obtaining control. The difference between the transaction price and contract consideration is amortized over the contract term using the effective interest method; financing components are not considered if the transfer of control and payment interval is one year or less.A performance obligation is satisfied over time if one of the following criteria is met; otherwise it is satisfied at a point in time: * The customer simultaneously receives and consumes the benefits provided by the Company's performance as the Company performs; * The customer can control the asset as it is created or enhanced during the Company's performance; * Goods produced during performance have no alternative use to the Company and the Company has an enforceable right to payment for performance completed to date throughout the contract period.For performance obligations satisfied over time the Company recognizes revenue over time according to the progress of performance except where progress cannot be reasonably determined. The Company determines performance progress using the input method (or output method). When performance progress cannot be reasonably determined if incurred costs are expected to be recovered revenue is recognized to the extent of costs incurred until progress can be reasonably determined.For performance obligations satisfied at a point in time the Company recognizes revenue when the customer obtains control over the relevant goods. In judging whether the customer has obtained control over goods or services the Company considers indicators including: * The Company has a present right to payment i.e. the customer has a present obligation to pay; 85FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) * The Company has transferred legal title of the goods to the customer i.e. the customer has legal title; * The Company has transferred physical possession of the goods to the customer i.e. the customer has physical possession; * The Company has transferred significant risks and rewards of ownership to the customer i.e. the customer has acquired significant risks and rewards of ownership; * The customer has accepted the goods.Sales with a Right of Return For sales with a right of return when the customer obtains control of the relevant goods the Company recognizes revenue based on the amount of consideration to which it expects to be entitled in exchange for transferring the goods and recognizes a provision (estimated liability) based on the amount expected to be refunded due to sales returns; at the same time an asset (cost of return receivables) is recognized based on the carrying amount of the goods expected to be returned at transfer less expected costs to recover those goods (including impairment in value of returned goods). Cost of sales is carried forward based on the carrying amount of transferred goods less the net amount of the aforementioned asset cost. At each balance sheet date the Company re-estimates future sales returns and remeasures the aforementioned assets and liabilities.Warranties The Company provides warranties for goods sold projects constructed etc. in accordance with contractual terms and statutory requirements. For assurance-type warranties assuring that goods sold comply with agreed-upon specifications the Company accounts for them in accordance with "CAS 13 — Contingencies". For service-type warranties that provide a distinct service in addition to assuring compliance with agreed-upon specifications the Company treats them as separate performance obligations allocating a portion of the transaction price based on the relative standalone selling prices of the goods and the service-type warranty and recognizing revenue when the customer obtains control of the service. In assessing whether a warranty provides a distinct service beyond assurance of compliance with agreed specifications the Company considers factors such as statutory requirements warranty period and the nature of tasks promised by the Company.Principal vs. Agent The Company assesses whether it is a principal or an agent based on whether it controls the specified goods or services before they are transferred to the customer. If the Company controls the goods or services before transfer to the customer it acts as a principal and recognizes revenue at the gross amount of consideration received or receivable. Otherwise the Company acts as an agent and recognizes revenue at the amount of fee or commission to which it expects to be entitled determined on a net basis after deducting amounts payable to third parties or based on predetermined commission amounts or percentages.Consideration Payable to Customers Where consideration is payable to a customer unless it is paid in exchange for a distinct good or service received from the customer the Company offsets such payable against the transaction price reducing current revenue at the later of when the related revenue is recognized and when the Company pays (or promises to pay) the consideration.Unexercised Customer Rights (Breakage) When the Company receives advance payments for goods or services from customers it first recognizes them as liabilities and reclassifies them as revenue upon fulfilling the performance obligations. When advance payments are non-refundable and customers may waive all or part of their contractual rights if the Company expects to be entitled to breakage amounts it recognizes such amounts as revenue in proportion to the pattern of rights exercised by the customer; otherwise the Company reclassifies the remaining liability balance to revenue only when the likelihood of the customer demanding performance of the remaining obligations is remote.Contract Modifications 86FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) When contract modifications occur in construction contracts with customers: 1) If the modification adds distinct construction services and contract price and the incremental price reflects standalone selling prices of the additional services the Company accounts for the contract modification as a separate contract; * If not falling under (1) above and the construction services transferred up to the modification date are distinct from those not yet transferred the Company treats the modification as a termination of the original contract and creates a new contract combining unperformed parts and modified parts; * If not falling under (1) above and the construction services transferred are not distinct from those not yet transferred the Company accounts for the modification as part of the existing contract adjusting current revenue on the modification date for the cumulative catch-up impact on recognized revenue.Circumstances Where Similar Businesses Adopt Different Operating Models Involving Different Revenue Recognition and Measurement Methods (2) Specific methods The specific revenue recognition methods of the Company are as follows: 1) Watch sales business The Company's watch sales business constitutes performance obligations satisfied at a point in time.A. Online sales Revenue is recognized when goods are dispatched and acknowledged/signed for by customers and payments have been collected by e-commerce platforms.B. Offline sales Revenue is recognized when goods are delivered to and accepted by customers payments have been received or the right to receive payment has been obtained and it is probable that associated economic benefits will flow to the Company.C. Consignment sales (as consignor) Under the consignment sales model the Company recognizes revenue upon receiving sales lists from consignees and confirming that control over goods has been transferred to purchasers.D. Commissioned consignment sales (as consignee) Under the commissioned consignment sales model the Company recognizes revenue on a net basis when delivered third-party consignment products to customers and confirming that control has been transferred to buyers. 2) Precision manufacturing business The Company's precision manufacturing sales business constitutes performance obligations satisfied at a point in time. Domestic sales revenue is recognized when products are delivered to contractually designated locations and accepted by customers payments are received or the right to collect payment is established and associated economic benefits are probable to flow to the Company. Export sales revenue is recognized when products are cleared through customs under contract terms bills of lading are obtained payments are received or the right to collect payment is established and associated economic benefits are probable to flow to the Company. 3) Property leasing business For specific accounting policies please refer to Note V.41 Accounting Treatment with the Company as Lessor. 38. Contract Costs Contract costs comprise contract performance costs and contract acquisition costs.Costs incurred by the Company to fulfill a contract are recognized as an asset (contract performance costs) when all of the following criteria are met: 87FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) * The cost relates directly to a contract or an anticipated contract including direct labor direct materials manufacturing overheads (or similar expenses) costs explicitly chargeable to the customer and other costs incurred solely because of entering into the contract; * The cost generates or enhances resources of the Company that will be used in satisfying performance obligations in the future; 3) The cost is expected to be recovered. Incremental costs incurred by the Company to obtain a contract are recognized as an asset (contract acquisition costs) if they are expected to be recovered.Assets recognized for contract costs are amortized on a systematic basis that is consistent with the transfer to the customer of the goods or services to which the asset relates; however if the amortization period of contract acquisition costs is one year or less the Company recognizes them in profit or loss when incurred.An impairment loss is recognized in profit or loss to the extent that the carrying amount of an asset related to contract costs exceeds the difference between the following two items with further assessment of whether provisions for onerous contracts should be recognized: 1) The remaining amount of consideration that the Company expects to receive in exchange for the goods or services to which the asset relates; 2) The estimated costs that relate directly to transferring those goods or services. If the impairment provision is subsequently reversed the increased carrying amount of the asset shall not exceed the carrying amount that would have been determined had no impairment provision been recognized on the reversal date.Contract performance costs recognized as assets are presented under "Inventories" if the amortization period at initial recognition is one year or one normal operating cycle or less and under "Other non-current assets" if exceeding one year or one normal operating cycle.Contract acquisition costs recognized as assets are presented under "Other current assets" if the amortization period at initial recognition is one year or one normal operating cycle or less and under "Other non-current assets" if exceeding one year or one normal operating cycle. 39. Government Grants (1) Recognition of government grants Government grants are recognized only when both of the following conditions are met: 1) The Company can comply with the conditions attached to the government grant; 2) The Company is able to receive the government grant. (2) Measurement of government grants Government grants in monetary assets are measured at the amount received or receivable. Government grants in non-monetary assets are measured at fair value; if fair value cannot be reliably determined they are measured at a nominal amount of RMB 1. (3) Accounting treatment of government grants 1) Asset-related government grants Government grants acquired by the Company for purchasing constructing or otherwise forming long-term assets are classified as asset-related government grants. Asset-related government grants are recognized as deferred income and recognized in profit or loss on a systematic and rational basis over the useful life of the related asset.Government grants measured at nominal amounts are directly recognized in current profit or loss. If the related asset is sold transferred scrapped or damaged before the end of its useful life the unallocated balance of deferred income is transferred to profit or loss in the period of asset disposal. 88FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 2) Income-related government grants Government grants other than asset-related government grants are classified as income-related government grants. Income-related government grants are accounted for as follows depending on circumstances: Grants used to compensate for related costs expenses or losses in subsequent periods are recognized as deferred income and recognized in current profit or loss in the period in which the related costs expenses or losses are recognized; grants used to compensate for related costs expenses or losses already incurred are directly recognized in current profit or loss.For government grants containing both asset-related and income-related portions they are accounted for separately; if difficult to distinguish they are classified entirely as income-related government grants.Government grants related to daily operating activities of the Company are recognized in other income based on economic substance. Government grants unrelated to daily operating activities are recognized in non-operating income and expenses. 3) Policy-based preferential loan interest subsidies Where fiscal authorities allocate interest subsidies to lending banks and lending banks provide loans to the Company at policy preferential interest rates the actual loan amount received is recognized as the entry value with borrowing costs calculated based on loan principal and preferential rates.Where fiscal authorities allocate interest subsidies directly to the Company the Company offsets the subsidies against relevant borrowing costs. 4) Repayment of government grants When a recognized government grant needs to be refunded if it was offset against the carrying amount of the related asset upon initial recognition the asset carrying amount is adjusted; if there is a related deferred income balance it is offset against the deferred income balance and any excess is recognized in current profit or loss; in other cases it is recognized directly in current profit or loss. 40. Deferred Income Tax Assets / Deferred Income Tax Liabilities The Company generally uses the balance sheet liability method to recognize and measure the income tax effects of taxable temporary differences or deductible temporary differences as deferred income tax liabilities or deferred income tax assets based on the differences between the carrying amounts of assets and liabilities and their tax bases at the balance sheet date. The Company does not discount deferred income tax assets and deferred income tax liabilities. (1) Recognition of deferred income tax assets For deductible temporary differences deductible losses and tax credits that can be carried forward to subsequent years the income tax effect is calculated at the tax rates expected to apply in the period of reversal and recognized as deferred income tax assets to the extent that it is probable that future taxable profits will be available against which the deductible temporary differences deductible losses and tax credits can be utilized.The income tax effect of deductible temporary differences arising from initial recognition of assets or liabilities in transactions or events possessing both of the following characteristics is not recognized as deferred income tax assets: A. The transaction is not a business combination; B. At the time of the transaction it affects neither accounting profit nor taxable profit (or deductible loss).However for single transactions meeting both of the above conditions where initial recognition of assets and liabilities results in equal taxable and deductible temporary differences the initial recognition exemption for deferred income tax liabilities and assets does not apply. For taxable and deductible temporary differences arising from initial 89FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) recognition of assets and liabilities in such transactions the Company recognizes corresponding deferred tax liabilities and assets at transaction occurrence.For deductible temporary differences related to investments in subsidiaries associates and joint ventures the tax effect is recognized as deferred tax assets only when both of the following conditions are met: A. It is probable that the temporary difference will reverse in the foreseeable future; B. It is probable that taxable profit will be available against which the deductible temporary difference can be utilized; At the balance sheet date if there is solid evidence that sufficient taxable profits will be available in future periods to utilize deductible temporary differences previously unrecognized deferred income tax assets are recognized.At each balance sheet date the Company reviews the carrying amount of deferred income tax assets. If it is probable that sufficient taxable profits will not be available in future periods to allow the benefit of deferred income tax assets to be utilized the carrying amount of deferred income tax assets is written down. Any such write-down is reversed to the extent that it becomes probable that sufficient taxable profit will be available. (2) Recognition of deferred income tax liabilities All taxable temporary differences of the Company are measured for their tax effects at tax rates expected to apply in the period of reversal and recognized as deferred income tax liabilities except for: 1) Tax effects of taxable temporary differences arising from the following transactions/events are not recognized as deferred income tax liabilities: A. Initial recognition of goodwill; B. Initial recognition of an asset or liability in a transaction that is not a business combination and at the time of the transaction affects neither accounting profit nor taxable profit (or deductible loss). 2) For taxable temporary differences related to investments in subsidiaries joint ventures and associates the tax effect is generally recognized as deferred tax liabilities except where both of the following conditions are met: A. The Company is able to control the timing of the reversal of the temporary difference; B. It is probable that the temporary difference will not reverse in the foreseeable future. (3) Recognition of deferred tax liabilities or assets involved in specific transactions 1) Deferred tax liabilities or assets related to business combinations For taxable or deductible temporary differences arising from business combinations not under common control the recognized deferred tax liabilities or assets and related deferred tax expenses (or income) generally adjust goodwill recognized in the combination.* Items directly recognized in owners' equity Current and deferred income taxes related to transactions or events recognized directly in owners' equity are recognized in owners' equity. Transactions or events whose temporary difference tax effects are recognized in owners' equity include: other comprehensive income from fair value changes of other debt investments adjustments to beginning retained earnings under retrospective adjustment for accounting policy changes or retrospective restatement for prior-period errors and compound financial instruments containing both liability and equity components recognized in owners' equity at initial recognition. 3) Tax losses and tax credits A. Recoverable tax losses and tax credits arising from the Company's own operations Deductible losses refer to losses determined in accordance with tax laws that are permitted to be carried forward to offset taxable profits in subsequent years. Unused tax losses (deductible losses) and tax credits that can be carried forward under tax laws are treated as deductible temporary differences. When it is probable that sufficient taxable profits will be available in future periods against which recoverable losses or tax credits can be utilized corresponding 90FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) deferred income tax assets are recognized up to the probable taxable profits reducing income tax expense in current profit or loss.B. Deductible unutilized losses of combinees arising from business combinations In a business combination deductible temporary differences of the acquiree obtained by the Company that do not meet deferred tax asset recognition criteria on the acquisition date are not recognized. If within 12 months after the acquisition date new or further information indicates that relevant conditions already existed on the acquisition date and the economic benefits of deductible temporary differences are expected to be realized deferred income tax assets are recognized with a corresponding reduction in goodwill; if goodwill is insufficient the difference is recognized in current profit or loss; in circumstances other than the above deferred income tax assets related to business combinations are recognized in current profit or loss. 4) Temporary differences arising from consolidation eliminations In preparing consolidated financial statements if temporary differences arise between the carrying amounts of assets and liabilities in the consolidated balance sheet and their tax bases in individual taxable entities due to elimination of unrealized internal sales profits/losses deferred tax assets or liabilities are recognized in the consolidated balance sheet and income tax expense is adjusted in the consolidated income statement except for deferred taxes related to transactions recognized directly in equity or business combinations. 5) Equity-settled share-based payments If tax laws permit tax deductions for expenses related to share-based payments during the period in which costs and expenses are recognized under accounting standards the Company estimates the tax-deductible amount based on information obtained at the end of the accounting period to determine tax bases and resulting temporary differences recognizing related deferred tax when recognition criteria are met. If the estimated future tax-deductible amount exceeds the cumulative costs and expenses recognized under accounting standards the tax effect of the excess is recognized directly in owners' equity. (4) Basis for presenting deferred income tax assets and liabilities on a net basis The Company presents deferred income tax assets and liabilities on a net basis after offsetting when both of the following conditions are met: 1) The Company has a legally enforceable right to settle current income tax assets and current income tax liabilities on a net basis; 2) Deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax assets and liabilities on a net basis or to realize the assets and settle the liabilities simultaneously in each future period in which significant amounts of deferred tax assets or liabilities are expected to be reversed. 41. Leases (1) Accounting treatment of leases as lessee 1) Accounting treatment of the Company as lessee At the commencement date of the lease the Company recognizes a lease with a lease term of 12 months or less and containing no purchase option as a short-term lease; a lease of an underlying asset that is of low value when new is recognized as a lease of a low-value asset. If the Company subleases or expects to sublease an underlying asset the head lease is not recognized as a lease of a low-value asset.For all short-term leases and low-value asset leases the Company recognizes lease payments in related asset costs or current profit or loss on a straight-line basis over each period of the lease term. 91FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Except for short-term leases and low-value asset leases subject to simplified treatment the Company recognizes right-of-use assets and lease liabilities at the lease commencement date. 1) Right-of-use assets A right-of-use asset refers to a lessee's right to use an underlying asset for the lease term.At the commencement date the right-of-use asset is initially measured at cost. This cost comprises: * The initial measurement amount of the lease liability; * Lease payments made at or before the commencement date less any lease incentives received; * Initial direct costs incurred by the lessee; * Estimated costs to be incurred by the lessee in dismantling and removing the underlying asset restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease. The Company recognizes and measures such costs according to the criteria and methods for provisions in Note V.34. Costs incurred to produce inventories are included in the cost of inventories.Right-of-use assets are depreciated by category using the straight-line method. Where ownership of the underlying asset is reasonably certain to be obtained at the end of the lease term the depreciation rate is determined over the remaining useful life of the underlying asset based on asset category and estimated net residual value rate; where ownership cannot be reasonably determined to be obtained at lease expiry depreciation is calculated over the shorter of the lease term and the remaining useful life based on asset category. 2) Lease liabilities Lease liabilities are initially measured at the present value of lease payments unpaid at the commencement date.Lease payments include the following five components: * Fixed payments and in-substance fixed payments less any lease incentives receivable; * Variable lease payments that depend on an index or a rate; * Exercise price of a purchase option provided that the lessee is reasonably certain to exercise that option; * Payments for terminating the lease provided that the lease term reflects the lessee exercising an option to terminate the lease; * Amounts expected to be payable by the lessee under residual value guarantees.In calculating the present value of lease payments the interest rate implicit in the lease is used as the discount rate; if that rate cannot be readily determined the Company's incremental borrowing rate is used. The difference between lease payments and their present value is treated as unrecognized financing charges with interest expense recognized in profit or loss across each period of the lease term using the discount rate determined for discounting lease payments. Variable lease payments not included in the measurement of lease liabilities are recognized in profit or loss when actually incurred.After commencement date upon changes in in-substance fixed payments expected amounts payable under residual value guarantees indices or rates used to determine payments or reassessments/actual exercises of purchase renewal or termination options the Company remeasures lease liabilities at the present value of revised lease payments and adjusts the carrying amount of right-of-use assets accordingly. 2) Accounting treatment of lease modifications 1) Lease modification accounted for as a separate lease A lease modification is accounted for as a separate lease if both of the following conditions are met: A. The modification increases the scope of the lease by adding the right to use one or more underlying assets; B. The consideration for the lease increases by an amount commensurate with the standalone price for the increase in scope and any appropriate adjustments to that standalone price to reflect the circumstances of the particular contract. 2) Lease modification not accounted for as a separate lease A. The Company as lessee 92FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) At the effective date of the lease modification the Company redetermines the lease term and remeasures the lease liability by discounting the revised lease payments using a revised discount rate. In calculating the present value of revised payments the interest rate implicit in the lease for the remainder of the term is used; if that rate cannot be determined the lessee's incremental borrowing rate at the effective date of the modification is used.The effects of lease liability adjustments are accounted for according to the following scenarios: * If the modification decreases the scope of the lease or shortens the lease term the carrying amount of the right- of-use asset is reduced and gains or losses relating to the partial or full termination of the lease are recognized in profit or loss; * For other lease modifications the carrying amount of the right-of-use asset is adjusted accordingly. 3) Sale and leaseback transactions The Company evaluates and determines whether the transfer of an asset in a sale and leaseback transaction qualifies as a sale in accordance with Note V.37.The Company as seller (lessee) If the transfer does not qualify as a sale the Company continues to recognize the transferred asset and recognizes a financial liability equal to the transfer proceeds accounting for the liability in accordance with Note V.11.If the transfer qualifies as a sale the Company measures the right-of-use asset arising from the leaseback at the proportion of the previous carrying amount of the asset that relates to the right of use retained recognizing only the amount of any gain or loss that relates to the rights transferred to the lessor. (2) Accounting treatment of leases as lessor 1) Accounting treatment of the Company as lessor At the inception date the Company classifies a lease as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset; otherwise it is classified as an operating lease. 1) Operating leases The Company recognizes lease receipts from operating leases as rental income on a straight-line basis over each period of the lease term. Initial direct costs incurred are capitalized amortized on the same basis as rental income recognition and recognized in profit or loss in installments. Variable lease payments received relating to operating leases that are not included in lease receipts are recognized in profit or loss when actually incurred. 2) Finance leases At the commencement date the Company recognizes finance lease receivables based on the net investment in the lease (the sum of unguaranteed residual value and lease receipts not received at commencement date discounted at the interest rate implicit in the lease) and derecognizes the finance lease asset. Over each period of the lease term the Company calculates and recognizes interest income using the interest rate implicit in the lease.Variable lease payments received that are not included in the measurement of the net investment in the lease are recognized in profit or loss when actually incurred. 2) Accounting treatment of lease modifications 1) Lease modification accounted for as a separate lease A lease modification is accounted for as a separate lease if both of the following conditions are met: A. The modification increases the scope of the lease by adding the right to use one or more underlying assets; B. The consideration for the lease increases by an amount commensurate with the standalone price for the increase in scope and any appropriate adjustments to that standalone price to reflect the circumstances of the particular contract. 2) Lease modification not accounted for as a separate lease B. The Company as lessor 93FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Where an operating lease is modified the Company accounts for it as a new lease from the effective date of the modification treating advances or receivables relating to the original lease as receipts for the new lease.If a finance lease modification is not accounted for as a separate lease the Company treats the modified lease as follows: if the lease would have been classified as an operating lease had the modification been effective at inception the Company accounts for it as a new lease from the effective date of modification measuring the asset's carrying amount at the net investment in the lease immediately before modification; if the lease would have been classified as a finance lease had the modification been effective at inception the Company accounts for it in accordance with provisions on contractual amendments or renegotiations. 3) Sale and leaseback transactions The Company evaluates and determines whether the transfer of an asset in a sale and leaseback transaction qualifies as a sale in accordance with Note V.37. 2) The Company as buyer (lessor) If the transfer of an asset in a sale and leaseback transaction does not qualify as a sale the Company does not recognize the transferred asset but recognizes a financial asset equal to the transfer amount accounting for it under Note V.11. If the transfer qualifies as a sale the Company accounts for the purchase of the asset in accordance with applicable CAS and accounts for the lease of the asset. 42. Other Significant Accounting Policies and Accounting Estimates Not applicable 43. Changes in Significant Accounting Policies and Accounting Estimates (1) Changes in significant accounting policies Not applicable (2) Changes in significant accounting estimates Not applicable (3) Adjustments to relevant financial statement items at the beginning of the year of first adoption of new accounting standards starting from 2026 Not applicable 44. Other Not applicable VI. Taxes 1. Major Tax Categories and Tax Rates Tax Category Tax Basis Tax Rate Taxable revenue Output VAT is calculated at 5% 6% 9% or 13%Value-added tax of sales and paid after deducting allowable input 94FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (VAT) VAT Consumption tax Taxable sales value and quantity ofluxury watches 20% Urban maintenance and construction tax Turnover taxes payable 5% 7% Enterprise income tax (EIT) Taxable income See the table below Property tax 70% or 80% of original property cost astax basis 1.2% 12% Disclosure of Taxable Entities with Different Enterprise Income Tax Rates Name of Taxable Entity Income Tax Rate FIYTA Precision Technology Co. Ltd. 25% Shenzhen Harmony World Watch Center Co. Ltd. (* ) 25% FIYTA Sales Co. Ltd. (* ) 25% Shenzhen FIYTA Precision Technology Co. Ltd. (* ) 15% Shenzhen FIYTA Technology Development Co. Ltd. (* ) 15% Harmony World Watch Center (Hainan) Co. Ltd. (* ) 20% Shenzhen Xunhang Precision Technology Co. Ltd. 25% Emile Chouriet Horlogerie (Shenzhen) Co. Ltd. 25% Liaoning Hengdarui Commercial & Trade Co. Ltd. 25% Shiyuehui Boutique (Shenzhen) Co. Ltd. 25% Shenzhen Harmony E-Commerce Co. Ltd. (* ) 20% FIYTA (Hong Kong) Limited (* ) 16.5% Montres Chouriet SA (* ) 30% Note: * In accordance with the "Interim Measures for the Administration of Collection of Enterprise Income Tax for Cross-Regional Consolidated Taxpaying Enterprises" issued by the State Taxation Administration the headquarters and branch offices of these companies implement the consolidated EIT payment method of "unified calculation hierarchical management local prepayment consolidated settlement and fiscal treasury adjustment". 50% is allocated and prepaid among branch offices and 50% is allocated and prepaid by the head office; * These companies enjoy the preferential enterprise income tax rate reduction for "High-tech Enterprises Supported by the State"; * The company is registered in Hong Kong and subject to Hong Kong profits tax with an applicable tax rate of 16.50% this year; * The company is registered in Switzerland and according to the local tax rates of its domicile the comprehensive effective tax rate this year is 30%; * These companies are small and micro-sized enterprises and pay enterprise income tax at a rate of 20%. 2. Tax Preferences According to the "Enterprise Income Tax Law of the People's Republic of China" high-tech enterprises supported by the state are subject to a reduced EIT rate of 15%. The Company's subsidiary Shenzhen FIYTA Precision Technology Co. Ltd. was recognized as a High-tech Enterprise in 2024 (Certificate No.: GR202444200965 valid for 3 years) and was subject to an EIT rate of 15% from 2024 to 2026; the Company's subsidiary Shenzhen FIYTA Technology Development Co. Ltd. was recognized as a High-tech Enterprise in 2025 (Certificate No.: GR202544201002 valid for 3 years) and is subject to an EIT rate of 15% from 2025 to 2027.Pursuant to the "Announcement of the Ministry of Finance and the State Taxation Administration on Preferential Income Tax Policies for Small and Micro Enterprises and Individual Industrial and Commercial Households" (Cai Shui 95FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) [2023] No. 6) the taxable income of small and micro enterprises is calculated at a reduced rate of 25% and enterprise income tax is paid at a rate of 20%.Pursuant to the "Notice of the Ministry of Finance and the State Taxation Administration on Extending the Loss Carryforward Period for High-tech Enterprises and Science and Technology SMEs" (Cai Shui [2018] No. 76) starting from January 1 2018 unrecovered losses incurred in the 5 accounting years prior to obtaining high-tech enterprise qualification are allowed to be carried forward to subsequent years with the maximum carryforward period extended from 5 years to 10 years.Pursuant to the "Announcement of the Ministry of Finance and the State Taxation Administration on Further Improving the Policy for Pre-tax Super Deduction of R&D Expenses" (Cai Shui [2023] No. 7) for actual R&D expenses incurred by enterprises that do not form intangible assets and are included in current profit or loss an extra 100% of the actual amount incurred is deducted before tax starting from January 1 2023 on top of actual deductions; for those forming intangible assets they are amortized before tax at 200% of the intangible asset cost starting from January 1 2023. Starting from 2019 Hong Kong implemented a two-tiered profits tax rate regime under which the profits tax rate for the first HKD 2 million of assessable profits for Hong Kong companies is reduced to 8.25% with remaining profits taxed at 16.5%. 3. Other Not applicable VII. Notes to Items in Consolidated Financial Statements 1. Cash and Cash Equivalents Unit: RMB Item Ending balance Beginning balance Cash on hand 32057.42 34041.22 Bank deposits 29624741.68 75156082.51 Other monetary funds 2419704.68 3489741.96 Funds deposited in finance companies 625703835.03 552559173.96 Total 657780338.81 631239039.65 Including: Total funds deposited overseas 4354107.60 7127169.50 Other Notes Note 1: Funds deposited in finance companies mainly represent funds deposited in AVIC Finance; Note 2: As of June 30 2026 the Company had no funds pledged frozen or subject to potential recovery risks.The details of funds deposited overseas with restricted repatriation are as follows: Item Ending balance Beginning balance Funds deposited overseas with restricted repatriation 4354107.60 7127169.50 96FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 2. Financial Assets Held for Trading Not applicable 3. Derivative Financial Assets Not applicable 4. Notes Receivable (1) Classification of notes receivable Unit: RMB Item Ending balance Beginning balance Bank acceptance bills 3396993.79 3665974.22 Commercial acceptance bills 11782658.85 9951213.33 Total 15179652.64 13617187.55 (2) Disclosure by bad debt provision method Unit: RMB Ending balance Beginning balance Categor Gross carryingamount Bad debt provision Gross carrying Carryin y amount Bad debt provision Carryin g g Amount Proportion Amount Provisio amount n ratio Amount Proporti on Amount Provisio amount n ratio Includin g: Notes receiva ble with bad debt provisio 15799 100.00 620139 3.92% 15179 14140 100.00 523748792.57 % .93 652.64 935.62 % .07 3.70% 13617 n 187.55 accrued on a portfolio basis Includin g: Comme rcial accepta 12402 78.50% 620139 5.00% 11782 10474 523748 99512 nce bills 798.78 .93 658.85 961.40 74.08%.075.00%13.33 portfolio Bank accepta 33969 33969 36659 36659 nce bills 93.79 21.50% 0.00 0.00% 93.79 74.22 25.92% 0.00 0.00% 74.22 portfolio 97FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Total 15799 100.00 620139 3.92% 15179 14140 100.00 523748792.57 % .93 652.64 935.62 % .07 3.70% 13617 187.55 Category of bad debt provision on a portfolio basis: Commercial acceptance bills portfolio Unit: RMB Ending balance Name Gross carrying amount Bad debt provision Provision ratio Commercial acceptance bills portfolio 12402798.78 620139.93 5.00% Total 12402798.78 620139.93 Basis for determining the portfolio: Receivables of the same type share similar credit risk characteristics.Category of bad debt provision on a portfolio basis: Bank acceptance bills portfolio Unit: RMB Ending balance Name Gross carrying amount Bad debt provision Provision ratio Bank acceptance bills portfolio 3396993.79 0.00 0.00% Total 3396993.79 0.00 Basis for determining the portfolio: The issuers have high credit ratings have had no historical bill defaults present extremely low credit loss risk and possess strong capacity to meet contractual cash flow payment obligations in the short term.If the general expected credit loss model is adopted for notes receivable bad debt provision: Not applicable (3) Bad debt provision accrued recovered or reversed in current period Accrual of bad debt provisions in current period: Unit: RMB Amount changed in current period Category Beginning Endingbalance Accrued Recovered or Written off Other balancereversed Notes receivable with bad debt provision accrued on an individual basis Notes receivable with bad debt provision accrued on a portfolio basis Including: Commercial acceptance 523748.07 96391.86 620139.93 bills portfolio Bank 98FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) acceptance bills portfolio Total 523748.07 96391.86 620139.93 Including significant recoveries or reversals of bad debt provisions in current period: Not applicable (4) Notes receivable pledged by the Company at the end of the period Not applicable (5) Notes receivable endorsed or discounted but not yet matured at the balance sheet date Not applicable (6) Notes receivable actually written off in current period Not applicable 5. Accounts Receivable (1) Disclosure by aging Unit: RMB Aging Ending gross carrying amount Beginning gross carrying amount Within 1 year (inclusive) 272323170.38 260899769.98 1 to 2 years 4921251.35 3565228.42 2 to 3 years 779390.62 524363.37 Over 3 years 9668485.22 9567138.57 3 to 4 years 524363.37 1410843.36 4 to 5 years 1400464.05 968144.90 Over 5 years 7743657.80 7188150.31 Total 287692297.57 274556500.34 (2) Disclosure by bad debt provision method Unit: RMB Ending balance Beginning balance Categor Gross carrying Bad debt provision Gross carryingamount Carryin amount Bad debt provision Carryiny g g Amount Proporti Amount Provisio amount Amount Proportion n ratio on Amount Provisio amount n ratio Account s receiva 14573 14281 292020 15766 15433 332995 ble with 270.71 5.07%250.0298.00%.69982.495.74%987.2397.89%.26 bad debt 99FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) provisio n accrued on an individu al basis Includin g: Account s receiva ble with bad debt 273119 91205 263998 258789 provisio 026.86 94.93% 69.56 3.34% 457.30 517.85 94.26% 92539 72.173.58% 249535 545.68 n accrued on a portfolio basis Includin g: Receiva bles from 273119 91205 263998 258789 92539 249535 custom 026.86 94.93% 69.56 3.34% 457.30 517.85 94.26% 72.17 3.58% 545.68 ers portfolio Total 287692 100.00 23401 8.13% 264290 274556 100.00 24687297.57 % 819.58 477.99 500.34 % 959.40 8.99% 249868 540.94 Category of individual bad debt provision: Receivables from customers Unit: RMB Beginning balance Ending balance Name Gross carrying Bad debt Gross carrying Bad debt Provision Reason for amount provision amount provision ratio provision Commercial Receivables disputes poor from 15766982.49 15433987.23 14573270.71 14281250.02 98.00% customer customers operations etc.Total 15766982.49 15433987.23 14573270.71 14281250.02 Category of portfolio bad debt provision: Receivables from customers portfolio Unit: RMB Ending balance Name Gross carrying amount Bad debt provision Provision ratio Receivables from customers portfolio 273119026.86 9120569.56 3.34% Total 273119026.86 9120569.56 Basis for determining the portfolio: Receivables of the same type share similar credit risk characteristics.If the general expected credit loss model is adopted for accounts receivable bad debt provision: 100FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Not applicable (3) Bad debt provision accrued recovered or reversed in current period Accrual of bad debt provisions in current period: Unit: RMB Amount changed in current period Category Beginningbalance Recovered or Ending balanceAccrued reversed Written off Other Accounts receivable with ECL accrued on an 15433987.23 237156.32 1389893.53 14281250.02 individual basis Accounts receivable with ECL 9253972.17 -118024.55 -15378.06 9120569.56 accrued on a portfolio basis Total 24687959.40 119131.77 1389893.53 -15378.06 23401819.58 Including significant recoveries or reversals of bad debt provisions in current period: Not applicable (4) Accounts receivable actually written off in current period Not applicable (5) Top five accounts receivable and contract assets grouped by debtor at period-end Unit: RMB Proportion of Ending balance Ending balance Ending balance Ending balance total ending of accounts of accounts balance of receivable badEntity Name of accounts of contract receivable assets receivable and accounts debt provision contract assets receivable and and contract contract assets asset impairmentprovision Summary of top five accounts receivable 76226406.11 76226406.11 26.50% 3811320.31 ending balances Total 76226406.11 76226406.11 26.50% 3811320.31 6. Contract Assets Not applicable 101FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 7. Receivables Financing Not applicable 8. Other Receivables Unit: RMB Item Ending balance Beginning balance Other receivables 55463903.88 51040153.19 Total 55463903.88 51040153.19 (1) Interest receivable 1) Classification of interest receivable Not applicable 2) Significant overdue interest Not applicable 3) Disclosure by bad debt provision method Not applicable 4) Bad debt provision accrued recovered or reversed in current period Not applicable 5) Interest receivable actually written off in current period Not applicable (2) Dividends receivable 1) Classification of dividends receivable Not applicable 2) Significant dividends receivable aged over 1 year Not applicable 3) Disclosure by bad debt provision method Not applicable 102FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 4) Bad debt provision accrued recovered or reversed in current period Not applicable 5) Dividends receivable actually written off in current period Not applicable (3) Other receivables 1) Classification of other receivables by nature Unit: RMB Nature of payment Ending gross carrying amount Beginning gross carrying amount Deposits and security deposits 49934260.20 49507243.06 Employee petty cash 2215776.38 941768.76 Other 10455237.05 7657685.25 Total 62605273.63 58106697.07 2) Disclosure by aging Unit: RMB Aging Ending gross carrying amount Beginning gross carrying amount Within 1 year (inclusive) 59901246.28 54498112.58 1 to 2 years 590786.00 2058962.96 2 to 3 years 572219.82 103556.63 Over 3 years 1541021.53 1446064.90 3 to 4 years 103556.63 167110.00 4 to 5 years 158510.00 119250.00 Over 5 years 1278954.90 1159704.90 Total 62605273.63 58106697.07 3) Disclosure by bad debt provision method Unit: RMB Ending balance Beginning balance Categor Gross carryingamount Bad debt provision Gross carrying Carryin y amount Bad debt provision Carryin g g Amount Proporti Amount Provisio amount Amount Proportion n ratio on Amount Provisio amount n ratio Accrue d on an 44252 44252 100.00 44152 44152 100.00 individu 61.16 7.07% 61.16 % 0.00 41.16 7.60% 41.16 % 0.00 al basis Including: Accrue 58180 92.93% 27161 4.67% 55463 53691012.47 08.59 903.88 455.91 92.40% 2651351040 d on a 02.72 4.94%153.19 103FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) portfolio basis Including: Deposit s and security 48910 78.13% 24938 5.10% 46416 48443 83.37% 24533 5.06% 45990deposit 811.67 78.09 933.58 814.53 08.64 505.89 s portfolio Employ ee petty 21820 3.49% 0.00 0.00% 21820 908012 908012cash 20.58 20.58 .96 1.56% 0.00 0.00% .96 portfolio Other receiva 70871 11.32% 222230 3.14% 68649 43396 7.47% 197994bles 80.22 .50 49.72 28.42 .08 4.56% 41416 34.34 portfolio Total 62605 100.00 71413 11.41% 55463 58106 100.00 70665 12.16% 51040273.63 % 69.75 903.88 697.07 % 43.88 153.19 Category of individual bad debt provision: Other receivables Unit: RMB Beginning balance Ending balance Name Gross Gross carrying Bad debt carrying Bad debt Reason for amount provision amount provision Provision ratio provision Other receivables 4415241.16 4415241.16 4425261.16 4425261.16 100.00% Disputes exist Total 4415241.16 4415241.16 4425261.16 4425261.16 Category of portfolio bad debt provision: Deposits and security deposits portfolio Unit: RMB Ending balance Name Gross carrying amount Bad debt provision Provision ratio Deposits and security deposits portfolio 48910811.67 2493878.09 5.10% Total 48910811.67 2493878.09 Basis for determining the portfolio: Receivables of the same nature share similar credit risk characteristics.Category of portfolio bad debt provision: Employee petty cash portfolio Unit: RMB Ending balance Name Gross carrying amount Bad debt provision Provision ratio Employee petty cash portfolio 2182020.58 0.00 0.00% Total 2182020.58 0.00 Basis for determining the portfolio: Receivables of the same nature share similar credit risk characteristics.Category of portfolio bad debt provision: Other receivables portfolio Unit: RMB Ending balance Name Gross carrying amount Bad debt provision Provision ratio Other receivables portfolio 7087180.22 222230.50 3.14% Total 7087180.22 222230.50 104FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Basis for determining the portfolio: Receivables of the same nature share similar credit risk characteristics.Bad debt provision accrued under the general expected credit loss model: Unit: RMB Stage 1 Stage 2 Stage 3 Bad debt provision 12-month expected Lifetime expected Lifetime expected Total credit losses credit losses (not credit losses (credit-credit-impaired) impaired) Balance as of January 1 2026 2651302.72 4415241.16 7066543.88 Balance as of January 1 2026 in current period -- Transfer to Stage 2 -- Transfer to Stage 3 -- Reverse to Stage 2 -- Reverse to Stage 1 Accrual in current period 65422.06 10400.00 75822.06 Reversal in current period 380.00 380.00 Other changes -616.19 -616.19 Balance as of June 3020262716108.594425261.167141369.75 Basis for stage division and bad debt provision accrual ratios Stage 1 represents bad debt provisions for other receivables aged within 1 year; Stage 2 represents bad debt provisions for other receivables aged over 1 year without individual assessment; Stage 3 represents bad debt provisions accrued on an individual assessment basis.Significant changes in gross carrying amounts affecting changes in loss allowances Not applicable 4) Bad debt provision accrued recovered or reversed in current period Accrual of bad debt provisions in current period: Unit: RMB Amount changed in current period Category Beginning Endingbalance Accrued Recovered or balancereversed Write-off Other Bad debt provision 7066543.88 75822.06 380.00 -616.19 7141369.75 Total 7066543.88 75822.06 380.00 -616.19 7141369.75 Including significant reversals or recoveries of bad debt provisions in current period: Not applicable 5) Other receivables actually written off in current period Not applicable 105FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 6) Top five other receivables grouped by debtor at period-end Unit: RMB Proportion of Nature of total ending Ending balanceEntity Name payment Ending balance Aging balance of other of bad debt receivables provision First Other 2650000.00 Within 1 year 4.23% 2650000.00 Second Deposits andsecurity deposits 1925263.00 Within 1 year 3.08% 96263.15 Third Deposits andsecurity deposits 1702620.00 Within 1 year 2.72% 85131.00 Fourth Deposits andsecurity deposits 1594477.50 Within 1 year 2.55% 79723.88 Fifth Deposits andsecurity deposits 1281330.00 Within 1 year 2.05% 64066.50 Total 9153690.50 14.62% 2975184.53 7) Presented in other receivables due to centralized cash management Not applicable 9. Prepayments (1) Presentation of prepayments by aging Unit: RMB Ending balance Beginning balance Aging Amount Proportion Amount Proportion Within 1 year 26452620.03 100.00% 4912759.05 100.00% 1 to 2 years 0.00 0.00% 0.00 0.00% 2 to 3 years 0.00 0.00% 0.00 0.00% Over 3 years 0.00 0.00% 0.00 0.00% Total 26452620.03 4912759.05 Explanation of reasons for non-settlement of significant prepayments aged over 1 year: Not applicable (2) Top five prepayments grouped by payee at period-end The aggregated ending balance of the top five prepayments grouped by payee in the current period was RMB 25444410.11 accounting for 96.19% of the total ending balance of prepayments. 10. Inventories Whether the Company needs to comply with real estate industry disclosure requirements No 106FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (1) Classification of inventories Unit: RMB Ending balance Beginning balance Provision for Provision for inventory inventory Item Gross carrying depreciation Gross depreciationor contract Carrying carrying or contract Carryingamount performance amount amount performance amount cost cost impairment impairment Raw materials 115650795.95 9739886.73 105910909.2123474829.59910053.86113564775.7293 Work in progress 6352114.28 0.00 6352114.28 7461603.28 0.00 7461603.28 Merchan dise inventory /1418376391.8168139133.17 1350237258170003007393074047.641606956025.64.29.65 Finished goods Total 1540379302.04 77879019.90 1462500282 1830966506 102984101.5 1727982404.14 .16 0 .66 (2) Data resources recognized as inventories Not applicable (3) Provision for inventory depreciation and contract performance cost impairment Unit: RMB Increase in current Beginning period Decrease in current period Item balance Ending balance Accrued Other Reversal or write-off Other Raw materials 9910053.86 170167.13 9739886.73 Merchandise inventory / Finished 93074047.64 24698986.29 235928.18 68139133.17 goods Total 102984101.50 24698986.29 406095.31 77879019.90 Provision for inventory depreciation accrued on a portfolio basis Not applicable (4) Description of capitalized borrowing costs in ending inventory balances Not applicable 107FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (5) Description of contract performance costs amortized in current period Not applicable 11. Assets Held for Sale Not applicable 12. Non-Current Assets Due Within One Year Not applicable (1) Debt investments due within one year Not applicable (2) Other debt investments due within one year Not applicable 13. Other Current Assets Unit: RMB Item Ending balance Beginning balance Reclassification of debit VAT balance 51005107.59 47303261.96 Certificates of deposit 73122285.72 0.00 Prepaid taxes and surcharges 5120414.75 5517052.75 Other 8844687.97 13690557.92 Total 138092496.03 66510872.63 14. Debt Investments Not applicable 15. Other Debt Investments Not applicable 16. Other Equity Instrument Investments Not applicable 17. Long-Term Receivables (1) Long-term receivables overview Not applicable 108FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (2) Disclosure by bad debt provision method Not applicable (3) Bad debt provision accrued recovered or reversed in current period Not applicable (4) Long-term receivables actually written off in current period Not applicable 18. Long-Term Equity Investments Unit: RMB Changes in current period Begin Begin Invest Endin Endin ning ning ment Other g g balan balan incom compr Cash Impair balan balan Invest ce ce of Additi Invest e/loss ehens Other divide ment ce ce of ee (carryi impair onal ment recog ive equity nds or provisi (carryi impair ng ment invest reduct nized incom chang profits on Other ng ment amou provisi ment ion under e es declar accru amou provisi nt) on equity adjust ed ed nt) on metho ments d I. Joint ventures II. Associates Shang hai 4643 Watch 6556. 2355 4667 96.74 2153.Co. 86 60 Ltd.Subtot 4643 4667 al 6556. 2355 96.742153.8660 46434667 Total 6556. 235596.74 2153.86 60 Recoverable amount determined at fair value less costs of disposal Not applicable Recoverable amount determined at present value of estimated future cash flows Not applicable Reasons for significant discrepancies between the above information and information used in prior years' impairment tests or external information Not applicable Reasons for significant discrepancies between information used in prior years' impairment tests and actual current- year conditions Not applicable 109FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Other Notes Not applicable 19. Other Non-Current Financial Assets Not applicable 20. Investment Properties (1) Investment properties measured under the cost model Unit: RMB Item Buildings andstructures Land use rights Construction in progress Total I. Original carrying amount 1. Beginning balance 555858219.43 555858219.43 2. Increase in current period 2847419.84 2847419.84 (1) Purchase (2) Transferred from inventories / fixed assets / construction 2847419.84 2847419.84 in progress (3) Increase from business combination 3. Decrease in current period (1) Disposal (2) Other transfers out (3) Transferred to fixed assets 4. Ending balance 558705639.27 558705639.27 II. Accumulated depreciation and accumulated amortization 1. Beginning balance 247587639.06 247587639.06 2. Increase in current period 9674001.21 9674001.21 (1) Accrual or amortization 6968952.37 6968952.37 (2) Transferred from fixed assets 2705048.84 2705048.84 3. Decrease in current period (1) Disposal 110FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (2) Other transfers out (3) Transferred to fixed assets 4. Ending balance 257261640.27 257261640.27 III. Impairment provision 1. Beginning balance 2. Increase in current period (1) Accrual 3. Decrease in current period (1) Disposal (2) Other transfers out 4. Ending balance IV. Carrying amount 1. Ending carrying amount 301443999.00 301443999.00 2. Beginning carrying amount 308270580.37 308270580.37 Recoverable amount determined at fair value less costs of disposal Not applicable Recoverable amount determined at present value of estimated future cash flows Not applicable Reasons for significant discrepancies between the above information and information used in prior years' impairment tests or external information Not applicable Reasons for significant discrepancies between information used in prior years' impairment tests and actual current- year conditions Not applicable Other Notes Not applicable (2) Investment properties measured under the fair value model Not applicable (3) Transferred to investment properties and measured at fair value Not applicable (4) Investment properties without property title certificates Not applicable 111FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 21. Fixed Assets Unit: RMB Item Ending balance Beginning balance Fixed assets 337417287.88 343353998.15 Disposal of fixed assets 0.00 0.00 Total 337417287.88 343353998.15 (1) Fixed assets breakdown Unit: RMB Buildings and MachineryItem and Transportation Electronic Otherstructures equipment equipment equipment equipment Total I. Original carrying amount: 1. Beginning 509813869.1 140974496.2 balance 8 5 9347026.59 52889659.73 41720151.56 754745203.3 2. Increase in current period 5445754.48 16479.96 2490641.91 634245.50 8587121.85 (1) Acquisition 5445754.48 16479.96 2490641.91 634245.50 8587121.85 (2) Transferred from construction in progress (3) Increase from business combination (4) Transferred back from investment properties (5) Translation differences of foreign currency statements 3. Decrease in current period 5777594.09 2163402.84 1210392.11 1328222.20 458666.77 10938278.01 (1) Disposal or retirement 729566.62 1210392.11 1283511.94 331641.72 3555112.39 (2) Transferred to investment 2847419.84 2847419.84 properties (3) Translation differences of foreign 2930174.25 1433836.22 44710.26 127025.05 4535745.78 currency 112FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) statements 4. Ending 504036275.0 144256847.8 balance 9 9 8153114.44 54052079.44 41895730.29 752394047.1 5 II.Accumulated depreciation 1. Beginning 224612441.1 balance 8 99430144.65 9210286.57 41030839.31 37107493.45 411391205.1 6 2. Increase in current period 7379281.95 3554416.79 53084.29 1708421.84 549537.47 13244742.34 (1) Accrual 7379281.95 3554416.79 53084.29 1708421.84 549537.47 13244742.34 (2) Transferred back from investment properties (3) Translation differences of foreign currency statements 3. Decrease in current period 5046656.96 2057221.53 1149872.50 1128667.30 276769.94 9659188.23 (1) Disposal or retirement 648811.03 1149872.50 1085909.50 149757.67 3034350.70 (2) Transferred to investment 2705048.84 2705048.84 properties (3) Translation differences of foreign 2341608.12 1408410.50 42757.80 127012.27 3919788.69 currency statements 4. Ending 226945066.1 100927339.9 8113498.36 41610593.85 37380260.98 414976759.2balance 7 1 7 III. Impairment provision 1. Beginning balance 2. Increase in current period (1) Accrual 3. Decrease in current period (1) Disposal or retirement 4. Ending balance IV. Carrying amount 1. Ending 277091208.9 43329507.98 39616.08 12441485.59 4515469.31 337417287.8 113FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) carrying 2 8 amount 2. Beginning carrying 285201428.0 41544351.60 136740.02 11858820.42 4612658.11 343353998.1 amount 0 5 (2) Temporarily idle fixed assets Not applicable (3) Fixed assets leased out under operating leases Not applicable (4) Fixed assets without property title certificates Unit: RMB Item Carrying amount Reason for title certificates not yetcompleted Buildings and structures 150453.94 Defects in property rights (5) Impairment tests of fixed assets Not applicable (6) Disposal of fixed assets Not applicable 22. Construction in Progress (1) Construction in progress overview Not applicable (2) Changes in major construction in progress projects during current period Not applicable (3) Impairment provisions accrued for construction in progress during current period Not applicable (4) Impairment tests of construction in progress Not applicable 114FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (5) Engineering materials Not applicable 23. Productive Biological Assets (1) Productive biological assets measured under the cost model Not applicable (2) Impairment tests of productive biological assets measured under the cost model Not applicable (3) Productive biological assets measured under the fair value model Not applicable 24. Oil and Gas Assets Not applicable 25. Right-of-Use Assets (1) Breakdown of right-of-use assets Unit: RMB Item Buildings and structures Total I. Original carrying amount 1. Beginning balance 189258884.19 189258884.19 2. Increase in current period 35107980.23 35107980.23 (1) Lease 35107980.23 35107980.23 3. Decrease in current period 59096717.77 59096717.77 (1) Disposal 59092725.61 59092725.61 (2) Translation differences of foreign currency statements 3992.16 3992.16 4. Ending balance 165270146.65 165270146.65 II. Accumulated depreciation 1. Beginning balance 116467792.13 116467792.13 2. Increase in current period 42251023.88 42251023.88 (1) Accrual 42251023.88 42251023.88 (2) Translation differences of foreign currency statements 3. Decrease in current period 55496801.21 55496801.21 (1) Disposal 55496801.21 55496801.21 4. Ending balance 103222014.80 103222014.80 III. Impairment provision 115FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 1. Beginning balance 2. Increase in current period (1) Accrual 3. Decrease in current period (1) Disposal 4. Ending balance IV. Carrying amount 1. Ending carrying amount 62048131.85 62048131.85 2. Beginning carrying amount 72791092.06 72791092.06 (2) Impairment tests of right-of-use assets Not applicable 26. Intangible Assets (1) Breakdown of intangible assets Unit: RMB Item Land userights Patents Non-patent Software Trademark technology systems rights Total I. Original carrying amount 1. Beginning balance 34933822.40 41923737.44 16630014.38 93487574.22 2. Increase in current period 637672.77 637672.77 (1) Acquisition 637672.77 637672.77 (2) Internal R&D (3) Increase from business combination (4) Translation differences of foreign currency statements 3. Decrease in current period 15762.40 0.46 15762.86 (1) Disposal (2) Translation differences of foreign 15762.40 0.46 15762.86 currency statements 4. Ending balance 34933822.40 42545647.81 16630013.92 94109484.13 116FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) II.Accumulated amortization 1. Beginning balance 18716581.87 32720189.07 10330059.24 61766830.18 2. Increase in current period 366776.65 1054451.09 7383.44 1428611.18 (1) Accrual 366776.65 1054451.09 7383.44 1428611.18 3. Decrease in current period 6304.96 6304.96 (1) Disposal (2) Translation differences of foreign 6304.96 6304.96 currency statements 4. Ending balance 19083358.52 33768335.20 10337442.68 63189136.40 III. Impairment provision 1. Beginning balance 2. Increase in current period (1) Accrual 3. Decrease in current period (1) Disposal 4. Ending balance IV. Carrying amount 1. Ending carrying 15850463.88 8777312.61 6292571.24 30920347.73 amount 2. Beginning carrying 16217240.53 9203548.37 6299955.14 31720744.04 amount Proportion of intangible assets formed through internal R&D to ending intangible asset balance: 0.00% (2) Data resources recognized as intangible assets Not applicable (3) Land use rights without title certificates Not applicable 117FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (4) Impairment tests of intangible assets Not applicable 27. Goodwill (1) Original carrying amount of goodwill Not applicable (2) Provision for goodwill impairment Not applicable (3) Relevant information of asset group or portfolio containing goodwill Not applicable (4) Specific determination method of recoverable amounts Not applicable (5) Fulfillment of performance commitments and corresponding goodwill impairment Not applicable 28. Long-Term Prepaid Expenses Unit: RMB Item Beginning Increase in Amortization inbalance current period current period Other decreases Ending balance Decoration and shop counter construction 76231700.49 7330749.24 26561168.68 507115.39 56494165.66 expenses Other 12942569.01 2615544.98 3101463.78 12456650.21 Total 89174269.50 9946294.22 29662632.46 507115.39 68950815.87 29. Deferred Income Tax Assets / Deferred Income Tax Liabilities (1) Un-offset deferred income tax assets Unit: RMB Ending balance Beginning balance Item Deductible temporary Deferred income tax Deductible temporary Deferred income tax differences assets differences assets Asset impairment provisions 98644996.59 22145545.82 123393575.15 28379525.24 118FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Unrealized profits from internal 48833283.15 11930325.18 73681954.31 17864553.33 transactions Deductible losses 266996150.00 57569144.35 203464885.90 45249255.22 Advertising and publicity expenses deductible in 15852279.52 3963069.88 0.00 0.00 subsequent years Lease liabilities 69456113.89 17364028.48 74789934.31 18697483.59 Other 4233830.22 1058457.55 5030696.54 1248681.80 Total 504016653.37 114030571.26 480361046.21 111439499.18 (2) Un-offset deferred income tax liabilities Unit: RMB Ending balance Beginning balance Item Taxable temporary Deferred income Taxable temporary Deferred income tax differences tax liabilities differences liabilities One-time pre-tax deduction of fixed assets 27952923.40 4192938.51 27169935.68 4075490.34 Right-of-use assets 68612775.52 17153193.88 72643762.42 18160940.61 Total 96565698.92 21346132.39 99813698.10 22236430.95 (3) Deferred income tax assets or liabilities presented on a net basis Unit: RMB Offset amount of Net ending balance Offset amount of Net beginning Item deferred tax assets of deferred tax deferred tax assets balance of deferredand liabilities at assets or liabilities and liabilities at tax assets or period-end after offset beginning of period liabilities after offset Deferred income tax assets 20763124.25 93267447.01 20713435.30 90726063.88 Deferred income tax liabilities 20763124.25 583008.14 20713435.30 1522995.65 (4) Details of unrecognized deferred income tax assets Unit: RMB Item Ending balance Beginning balance Deductible temporary differences 10582452.38 11868777.70 Deductible losses 0.00 0.00 Total 10582452.38 11868777.70 (5) Deductible losses of unrecognized deferred tax assets expiring in subsequent years Not applicable 119FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 30. Other Non-Current Assets Unit: RMB Ending balance Beginning balance Item Gross carrying Impairmen Carrying Gross carrying Impairment Carrying amount t provision amount amount provision amount Prepayments for long-term 171008639.08 171008639.08 5757347.81 5757347.81 assets Total 171008639.08 171008639.08 5757347.81 5757347.81 31. Assets with Restricted Ownership or Use Rights Not applicable 32. Short-Term Borrowings (1) Classification of short-term borrowings Not applicable (2) Overdue outstanding short-term borrowings Not applicable 33. Financial Liabilities Held for Trading Not applicable 34. Derivative Financial Liabilities Not applicable 35. Notes Payable Not applicable 36. Accounts Payable (1) Presentation of accounts payable Unit: RMB Item Ending balance Beginning balance Payables for goods 68846072.91 94791440.02 Total 68846072.91 94791440.02 120FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (2) Significant accounts payable aged over 1 year or overdue Not applicable 37. Other Payables Unit: RMB Item Ending balance Beginning balance Other payables 78195511.10 75141232.27 Total 78195511.10 75141232.27 (1) Interest payable Not applicable (2) Dividends payable Not applicable (3) Other payables 1) Presentation of other payables by nature Unit: RMB Item Ending balance Beginning balance Deposits and security deposits 28985384.66 28070048.35 Decoration payables 3595389.05 3524465.97 Accrued expenses and other payables 45614737.39 43546717.95 Total 78195511.10 75141232.27 2) Significant other payables aged over 1 year or overdue Not applicable 38. Advances from Customers (1) Presentation of advances from customers Unit: RMB Item Ending balance Beginning balance Rental advances 7051846.87 11368005.63 Total 7051846.87 11368005.63 (2) Significant advances from customers aged over 1 year or overdue Not applicable 121FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 39. Contract Liabilities Unit: RMB Item Ending balance Beginning balance Advances received for goods 18121608.21 16450934.50 Total 18121608.21 16450934.50 Significant contract liabilities aged over 1 year Not applicable Amounts and reasons for significant changes in carrying amounts during reporting period Not applicable 40. Employee Benefits Payable (1) Presentation of employee benefits payable Unit: RMB Item Beginning balance Increased in current Decrease in currentperiod period Ending balance I. Short-term employee benefits 67568251.00 224189841.22 234035826.57 57722265.65 II. Post-employment benefits - Defined 7642994.24 22650044.70 24459412.03 5833626.91 contribution plans III. Termination benefits 4847972.58 2662784.40 6787901.21 722855.77 Total 80059217.82 249502670.32 265283139.81 64278748.33 (2) Presentation of short-term employee benefits Unit: RMB Item Beginning balance Increased in current Decrease in currentperiod period Ending balance 1. Salaries bonuses allowances and 66563202.49 199846803.10 209868028.77 56541976.82 subsidies 2. Employee welfare expenses 5661.88 4036561.78 4014725.58 27498.08 3. Social insurance premiums 349672.75 9230744.29 9225968.33 354448.71 Including: Medical insurance premiums 349594.43 8252005.25 8247297.51 354302.17 Work-related injury insurance premiums 78.32 604965.09 604896.87 146.54 Maternity insurance premiums 0.00 373773.95 373773.95 0.00 4. Housing provident funds 16453.20 8089778.57 8105559.77 672.00 5. Union running 633260.68 2985953.48 2821544.12 797670.04 122FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) costs and employee education funds Total 67568251.00 224189841.22 234035826.57 57722265.65 (3) Presentation of defined contribution plans Unit: RMB Item Beginning balance Increased in current Decrease in currentperiod period Ending balance 1. Basic pension insurance 153864.51 19565992.45 19674056.00 45800.96 2. Unemployment insurance premiums 126.27 795957.89 795362.98 721.18 3. Enterprise annuity contributions 7489003.46 2288094.36 3989993.05 5787104.77 Total 7642994.24 22650044.70 24459412.03 5833626.91 41. Taxes and Surcharges Payable Unit: RMB Item Ending balance Beginning balance Value-added tax (VAT) 27745887.68 24404139.24 Enterprise income tax (EIT) 16639669.59 12878070.87 Individual income tax 717830.57 969315.24 Urban maintenance and construction tax 667021.47 453029.07 Educational surcharges 476950.35 316181.96 Other 3809182.79 1177277.66 Total 50056542.45 40198014.04 42. Liabilities Held for Sale Not applicable 43. Non-Current Liabilities Due Within One Year Unit: RMB Item Ending balance Beginning balance Lease liabilities due within one year 48155286.06 57044492.54 Total 48155286.06 57044492.54 44. Other Current Liabilities Unit: RMB Item Ending balance Beginning balance Output VAT to be transferred 1870242.74 2392725.11 Total 1870242.74 2392725.11 123FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Changes in short-term bonds payable: Not applicable 45. Long-Term Borrowings (1) Classification of long-term borrowings Not applicable 46. Bonds Payable (1) Bonds payable Not applicable (2) Changes in bonds payable (excluding preferred shares perpetual bonds and other financial instruments classified as financial liabilities) Not applicable (3) Explanation of convertible corporate bonds Not applicable (4) Explanation of other financial instruments classified as financial liabilities Not applicable 47. Lease Liabilities Unit: RMB Item Ending balance Beginning balance Buildings and structures 63976001.44 76851971.25 Unrecognized financing charges -1084251.20 -1915088.40 Lease liabilities due within one year -48155286.06 -57044492.54 Total 14736464.18 17892390.31 48. Long-Term Payables Not applicable (1) Presentation of long-term payables by nature Not applicable 124FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (2) Special payables Not applicable 49. Long-Term Employee Benefits Payable (1) Statement of long-term employee benefits payable Not applicable (2) Changes in defined benefit plans Not applicable 50. Provisions Not applicable 51. Deferred Income Not applicable 52. Other Non-Current Liabilities Not applicable 53. Share Capital Unit: RMB Changes during current period (+ -) Beginning Conversion balance Issuance of Bonus of capital Ending balance new shares shares reserve into Other Subtotal shares Total number 405764007.00 0.00 0.00 0.00 0.00 0.00 405764007.00 of shares 54. Other Equity Instruments (1) Basic information on preferred shares perpetual bonds and other financial instruments outstanding at period-end Not applicable 125FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (2) Statement of changes in preferred shares perpetual bonds and other financial instruments outstanding at period-end Not applicable 55. Capital Reserve Unit: RMB Item Beginning balance Increased in current Decrease in currentperiod period Ending balance Capital premium (share premium) 921603733.97 0.00 0.00 921603733.97 Other capital reserve 14005517.97 0.00 0.00 14005517.97 Total 935609251.94 0.00 0.00 935609251.94 Other notes including changes in current period and reasons for changes: Not applicable 56. Treasury Shares Not applicable 57. Other Comprehensive Income Unit: RMB Amount incurred in current period Amount Less: Less: Net-of-tax Net-of-tax Beginning before Reclassifi Reclassifi Less: amount amount Item Endingbalance income cation of cation of previous previous Income attributabl attributabl balancetax in current OCI into OCI into tax e to e to non- period profit or retained expense parent controlling loss earnings company interests I. Other comprehe nsive income that cannot be reclassifie d to profit or loss Including: Changes in remeasur ement of defined benefit plans Other 126FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) comprehe nsive income that cannot be transferre d to profit or loss under equity method Fair value changes of other equity instrument investmen ts Fair value changes of enterprise' s own credit risk II. Other comprehe nsive income 2366521 - - 1499478 that will be 7.37 8670432. 8670432.reclassifie 39 39 4.98 d to profit or loss Including: Other comprehe nsive income that can be transferre d to profit or loss under equity method Fair value changes of other debt investmen ts Amou nt of 127FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) financial assets reclassifie d into other comprehe nsive income Credit impairmen t provisions for other debt investmen ts Cash flow hedge reserve Trans lation difference s of foreign 2366521 -- 7.378670432.8670432. 1499478 currency 39 39 4.98 financial statement s Total other comprehe 2366521 -- 7.378670432.8670432. 1499478 nsive 39 39 4.98 income 58. Special Reserve Unit: RMB Item Beginning balance Increased in current Decrease in currentperiod period Ending balance Work safety funds 3961169.87 260691.30 349848.38 3872012.79 Total 3961169.87 260691.30 349848.38 3872012.79 59. Surplus Reserve Unit: RMB Item Beginning balance Increased in current Decrease in currentperiod period Ending balance Statutory surplus reserve 213025507.50 0.00 0.00 213025507.50 Discretionary surplus reserve 61984894.00 0.00 0.00 61984894.00 128FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Total 275010401.50 0.00 0.00 275010401.50 60. Undistributed Profits Unit: RMB Item Current period Prior period Undistributed profits at the end of prior period before adjustment 1692530114.77 1767517887.94 Total adjustment of beginning undistributed profits (increase + 0.00 0.00 decrease -) Beginning undistributed profits after adjustment 1692530114.77 1767517887.94 Add: Net profit attributable to owners of the parent company in current 100504370.41 87317829.63 period Dividends payable on ordinary shares 48691680.84 162305602.80 Ending undistributed profits 1744342804.34 1692530114.77 Details of adjustments to beginning undistributed profits: 1) Due to retrospective adjustments under CAS and relevant new regulations beginning undistributed profits were affected by RMB 0.00. 2) Due to changes in accounting policies beginning undistributed profits were affected by RMB 0.00. 3) Due to corrections of material accounting errors beginning undistributed profits were affected by RMB 0.00. 4) Due to changes in the scope of consolidation under common control beginning undistributed profits were affected by RMB 0.00. 5) Other adjustments collectively affected beginning undistributed profits by RMB 0.00. 61. Operating Revenue and Operating Costs Unit: RMB Amount incurred in current period Amount in prior period Item Revenue Costs Revenue Costs Principal businesses 1823698835.87 1185961781.16 1777911239.83 1149101334.42 Other businesses 16781504.61 10241040.61 6220697.40 707277.15 Total 1840480340.48 1196202821.77 1784131937.23 1149808611.57 Disaggregated information of operating revenue and operating costs: Unit: RMB Segment 1 Total Contract Classification Operating revenue Operating costs Operating revenue Operating costs Business Type Including: Watch brand business 252452120.62 70365782.78 252452120.62 70365782.78 Comprehensive luxury watch service business 1439244294.54 1032651556.04 1439244294.54 1032651556.04 Precision technology business 79085973.27 66190591.02 79085973.27 66190591.02 129FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Leasing business 52916447.44 16753851.32 52916447.44 16753851.32 Other 16781504.61 10241040.61 16781504.61 10241040.61 By Operating Region Including: South China 846839128.62 546188552.47 846839128.62 546188552.47 Northwest China 255622443.68 165765219.64 255622443.68 165765219.64 North China 67720684.71 41875442.33 67720684.71 41875442.33 East China 152531098.84 94900877.97 152531098.84 94900877.97 Northeast China 181784914.65 127934009.81 181784914.65 127934009.81 Southwest China 335982069.98 219538719.55 335982069.98 219538719.55 Total 1840480340.48 1196202821.77 1840480340.48 1196202821.77 Other Notes See Note V.37 for details.Information related to transaction prices allocated to remaining performance obligations: At the end of the reporting period revenue corresponding to performance obligations that have been signed but not yet performed or completed was RMB 0.00.Information related to variable consideration in contracts: Not applicable Significant Contract Modifications or Major Transaction Price Adjustments Not applicable 62. Taxes and Surcharges Unit: RMB Item Amount incurred in current period Amount in prior period Consumption tax 1161736.13 1206242.82 Urban maintenance and construction tax 6815670.98 5065292.07 Educational surcharges 4855547.05 3560819.76 Property tax 3711955.46 3761835.26 Land use tax 200921.98 193107.20 Vehicle and vessel usage tax 1680.00 1020.00 Stamp duty 1393054.07 1137269.96 Other 321875.39 587613.97 Total 18462441.06 15513201.04 63. Administrative Expenses Unit: RMB Item Amount incurred in current period Amount in prior period Employee benefits 72836051.07 70190119.12 Depreciation and amortization 9761906.82 10093537.37 Travel expenses 1589706.47 697547.75 Office expenses 1318846.75 1218376.72 Intermediary fees 1615228.32 1543816.43 Utilities property management and rental expenses 1508452.49 1554287.31 Business entertainment expenses 215725.98 229638.66 130FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Vehicle and transportation expenses 476856.31 431178.16 Communication expenses 72843.71 106156.57 Other 5959170.82 3906851.92 Total 95354788.74 89971510.01 64. Selling Expenses Unit: RMB Item Amount incurred in current period Amount in prior period Employee benefits 118180389.36 151438933.03 Mall and rental expenses 82328499.83 64976038.21 Advertising exhibition and marketing promotion expenses 62380235.33 66944607.21 Depreciation and amortization 69408538.50 85895948.64 Packaging expenses 2613732.57 3354092.79 Utilities and property management fees 9947390.90 10758091.61 Transportation expenses 2049319.60 2155504.25 Office expenses 1834779.28 2092204.90 Travel expenses 1818131.83 1727206.33 Business entertainment expenses 593496.54 882474.30 Other 9499741.59 2582931.38 Total 360654255.33 392808032.65 65. R&D Expenses Unit: RMB Item Amount incurred in current period Amount in prior period Employee benefits 33415540.82 25193556.07 Sample and material costs 1317816.72 427397.19 Depreciation and amortization 2463373.05 2484373.63 Technical cooperation expenses 425254.93 1292546.07 Other 3095411.12 3689998.37 Total 40717396.64 33087871.33 66. Financial Expenses Unit: RMB Item Amount incurred in current period Amount in prior period Interest expense 1186429.02 2390395.42 Less: Capitalized interest 0.00 0.00 Less: Interest income 1831836.70 1870950.85 Foreign exchange gains/losses -1511346.78 -560384.92 Bank handling charges and other expenses 5192195.34 5681020.64 Total 3035440.88 5640080.29 67. Other Income Unit: RMB Sources Generating Other Income Amount incurred in current period Amount in prior period 131FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Government grants 1916497.10 1509835.03 Handling fees for withholding individual income tax 619576.19 565713.33 Additional deduction for input VAT 619229.75 871341.32 Total 3155303.04 2946889.68 68. Net Exposure Hedging Gains Not applicable 69. Gains from Changes in Fair Value Not applicable 70. Investment Income Unit: RMB Item Amount incurred in current period Amount in prior period Investment income from long-term equity investments under equity 235596.74 494545.14 method Interest on time deposits 394557.22 247499.84 Total 630153.96 742044.98 71. Credit Impairment Losses Unit: RMB Item Amount incurred in current period Amount in prior period Bad debt losses on notes receivable -96391.86 676063.08 Bad debt losses on accounts receivable 1270761.76 1433272.16 Bad debt losses on other receivables -75442.06 118839.22 Total 1098927.84 2228174.46 72. Asset Impairment Losses Unit: RMB Item Amount incurred in current period Amount in prior period I. Inventory depreciation losses and contract performance cost 0.00 1780567.39 impairment losses II. Impairment losses on long-term equity investments III. Impairment losses on investment properties IV. Impairment losses on fixed assets V. Impairment losses on engineering materials 132FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) VI. Impairment losses on construction in progress VII. Impairment losses on productive biological assets VIII. Impairment losses on oil and gas assets IX. Impairment losses on intangible assets X. Impairment losses on goodwill XI. Impairment losses on contract assets XII. Other Total 0.00 1780567.39 73. Gains on Disposal of Assets Unit: RMB Sources of Gains on Disposal of Assets Amount incurred in current period Amount in prior period Gains or losses on disposal of fixed assets -72202.13 -136999.29 Gains or losses on disposal of right- of-use assets 546265.61 -287408.03 Total 474063.48 -424407.32 74. Non-Operating Income Unit: RMB Amount incurred in current Amount recognized inItem period Amount in prior period current non-recurring profitor loss Payables no longer required to be paid 342.85 208509.16 342.85 Compensation income 537470.88 913547.80 537470.88 Other 115267.30 82150.96 115267.30 Total 653081.03 1204207.92 653081.03 75. Non-Operating Expenses Unit: RMB Item Amount incurred in current Amount recognized in period Amount in prior period current non-recurring profitor loss Losses on non-monetary asset exchanges 0.00 0.00 0.00 External donations 0.00 0.00 0.00 Fines and late payment surcharges 347117.28 139702.96 347117.28 Liquidated damages 43279.99 1045.00 43279.99 133FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Other 9816.95 78693.73 9816.95 Total 400214.22 219441.69 400214.22 76. Income Tax Expense (1) Statement of income tax expense Unit: RMB Item Amount incurred in current period Amount in prior period Current income tax expense 34641511.42 21933368.58 Deferred income tax expense -3481370.64 1181797.15 Total 31160140.78 23115165.73 (2) Reconciliation of accounting profit to income tax expense Unit: RMB Item Amount incurred in current period Total profit 131664511.19 Income tax expense calculated at statutory/applicable tax rates 32916127.80 Impact of different tax rates applicable to subsidiaries 148591.51 Impact of adjustments to income tax of prior periods 310828.33 Impact of non-taxable income -58899.19 Impact of non-deductible costs expenses and losses 1066613.03 Super deduction for R&D expenses -3223120.70 Income tax expense 31160140.78 77. Other Comprehensive Income See Note VII.57 for details. 78. Cash Flow Statement Items (1) Cash related to operating activities Cash received relating to other operating activities Unit: RMB Item Amount incurred in current period Amount in prior period Deposits and security deposits 1647257.08 4721865.96 Government grants 2226588.68 1698194.84 Product promotion fees 1067423.08 2732719.87 Interest income 1831836.70 1913911.99 Petty cash 377419.23 843906.32 Other 2934491.87 8406114.61 Total 10085016.64 20316713.59 Cash paid relating to other operating activities Unit: RMB 134FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Item Amount incurred in current period Amount in prior period Deposits and security deposits 5371300.42 5929267.55 Period expenses and other expenses 152962069.84 145952265.33 Total 158333370.26 151881532.88 (2) Cash related to investing activities Cash received relating to other investing activities Unit: RMB Item Amount incurred in current period Amount in prior period Maturity of time deposits 3389433.51 104282319.06 Total 3389433.51 104282319.06 Significant cash received relating to investing activities Not applicable Cash paid relating to other investing activities Unit: RMB Item Amount incurred in current period Amount in prior period Placement of time deposits 76251159.49 111168651.92 Total 76251159.49 111168651.92 Significant cash paid relating to investing activities Not applicable (3) Cash related to financing activities Cash received relating to other financing activities Not applicable Cash paid relating to other financing activities Unit: RMB Item Amount incurred in current period Amount in prior period Cash outflow for leases 46135370.10 45795435.69 Total 46135370.10 45795435.69 Explanation of cash paid relating to other financing activities: Not applicable Changes in liabilities arising from financing activities Unit: RMB Increased in current period Decrease in current period Item Beginning Endingbalance Cash changes Non-cash Non-cash balancechanges Cash changes changes Short-term borrowings 11000000.00 32926.07 11032926.07 Dividends payable 48691680.84 48691680.84 Non-current liabilities due within one 57044492.54 37246163.62 46135370.10 48155286.06 year 135FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Lease liabilities 17892390.31 34090237.49 37246163.62 14736464.18 Total 74936882.85 11000000.00 120061008.0 105859977.02 1 37246163.62 62891750.24 (4) Description of cash flows presented on a net basis Not applicable (5) Significant activities and financial impacts not involving current cash flows but affecting financial position or future cash flows Not applicable 79. Supplementary Information to the Cash Flow Statement (1) Supplementary information to the cash flow statement Unit: RMB Supplementary Information Amount in Current Period Amount in prior period 1. Reconciliation of net profit to cash flows from operating activities: Net profit 100504370.41 82445500.03 Add: Asset impairment provisions -1098927.84 -4008741.85 Depreciation of fixed assets depletion of oil and gas assets and depreciation of productive biological 20213694.71 20339883.04 assets Depreciation of right-of-use assets 42251023.88 49457474.41 Amortization of intangible assets 1428611.18 1441178.28 Amortization of long-term prepaid expenses 29662632.46 36795322.80 Losses on disposal of fixed assets intangible assets and other long-term assets (gains are indicated -474063.48 424407.32 by "-") Losses on scrapping of fixed assets (gains are indicated by "-") Losses from changes in fair value (gains are indicated by "-") Financial expenses (income is indicated by "-") 1186429.02 1830010.50 Investment losses (income is indicated by "-") -630153.96 -742044.98 Decrease in deferred tax assets (increase is indicated by "-") -2541383.13 4768466.33 Increase in deferred tax -939987.51 -2856417.52 136FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) liabilities (decrease is indicated by "- ") Decrease in inventories (increase is indicated by "-") 290587204.12 141549995.09 Decrease in operating receivables (increase is indicated by -40736699.86 -38310215.86 "-") Increase in operating payables (decrease is indicated by "-") -55440129.60 -41644010.52 Other Net cash flows from operating activities 383972620.40 251490807.07 2. Significant investing and financing activities not involving cash receipts and payments: Conversion of debt into capital Convertible corporate bonds due within one year Fixed assets leased under finance leases 3. Net changes in cash and cash equivalents: Ending balance of cash 657780338.81 539306933.97 Less: Beginning balance of cash 631239039.65 518954177.49 Add: Ending balance of cash equivalents Less: Beginning balance of cash equivalents Net increase in cash and cash equivalents 26541299.16 20352756.48 (2) Net cash paid for acquisition of subsidiaries in current period Not applicable (3) Net cash received from disposal of subsidiaries in current period Not applicable (4) Composition of cash and cash equivalents Unit: RMB Item Ending balance Beginning balance I. Cash 657780338.81 631239039.65 Including: Cash on hand 32057.42 34041.22 Bank deposits readily available for payment 655328576.71 627225875.81 Other monetary funds readily 2419704.68 3979122.62 137FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) available for payment II. Cash equivalents Including: Bond investments maturing within three months III. Ending balance of cash and cash equivalents 657780338.81 631239039.65 Including: Restricted cash and cash equivalents used by the parent company or subsidiaries within the 4354107.60 7127169.50 group (5) Circumstances where funds are restricted in use but still presented as cash and cash equivalents Unit: RMB Reason for still qualifying Item Amount in Current Period Amount in prior period as cash and cash equivalents Account funds of the Company's subsidiary FIYTA (Hong Kong) Limited and sub-subsidiary Bank deposits 4354107.60 499487.91 Montres Chouriet SA are deposited overseas with restricted repatriation but their routine operational use is not affected.Total 4354107.60 499487.91 (6) Monetary funds not qualifying as cash and cash equivalents Not applicable (7) Explanation of other significant activities Not applicable 80. Notes to Items in Statement of Changes in Owners' Equity Not applicable 81. Foreign Currency Monetary Items (1) Foreign currency monetary items Unit: RMB Item Ending foreign currencybalance Translation exchange rate Ending balance translated into RMB Cash and cash equivalents 11734756.15 138FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Including: USD 322360.82 6.8109 2195567.30 EUR 41867.18 7.7671 325186.59 HKD 5571302.28 0.8686 4838954.60 CHF 519429.13 8.4228 4375047.68 Accounts receivable 7223507.79 Including: USD 759231.08 6.8109 5171046.99 EUR HKD 2134337.88 0.8686 1853779.17 CHF 23588.55 8.4228 198681.64 Long-term borrowings Including: USD EUR HKD Other receivables 185283.70 Including: HKD 2005.60 0.8686 1741.96 CHF 21791.06 8.4228 183541.74 Accounts payable 378240.29 Including: USD 0.76 6.8109 5.18 HKD 435478.80 0.8686 378235.11 Other payables 544464.24 Including: USD 10611.45 6.8109 72273.52 HKD 411254.27 0.8686 357194.90 CHF 13652.92 8.4228 114995.81 (2) Nature and financial impact of non-convertibility of currencies spot rates adopted and estimation processes and enterprise exposure to non-convertibility risks Not applicable (3) Explanation of overseas operating entities including disclosures of principal place of business functional currency basis of determination and reasons for any changes in functional currency For the principal places of business and functional currencies of significant overseas entities please refer to Note V.4. (4) Non-convertibility between the functional currency of overseas operations and the Company's presentation currency Not applicable 82. Leases (1) The Company as lessee Variable lease payments not included in the measurement of lease liabilities Item Amount for H1 2026 Short-term lease expenses with simplified treatment recognized in current profit or loss 4871519.12 139FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Lease expenses for low-value assets (excluding short-term leases) with simplified treatment recognized in current profit or loss Interest expense on lease liabilities 1119341.05 Variable lease payments not included in the measurement of lease liabilities recognized in current profit or loss 57289788.10 Income from subleasing right-of-use assets Total cash outflow related to leases 108296677.32 Gains and losses arising from sale and leaseback transactions In the first half of 2026 variable lease payments not included in the measurement of lease liabilities recognized in current profit or loss amounted to RMB 57289788.10.Lease expenses for short-term leases or low-value assets with simplified treatment In the first half of 2026 short-term lease expenses with simplified treatment recognized in current profit or loss amounted to RMB 4871519.12.Circumstances involving sale and leaseback transactions Not applicable (2) The Company as lessor Operating leases as lessor Unit: RMB Including: Income related to variable Item Lease income lease payments not included in lease receipts Lease income 52916447.44 0.00 Total 52916447.44 0.00 Finance leases as lessor Not applicable Undiscounted lease receipts for each of the next five years Not applicable Reconciliation of undiscounted lease receipts to net investment in the lease Not applicable (3) Selling profit or loss recognized as manufacturer or dealer in finance leases Not applicable 83. Data Resources Not applicable 84. Other Not applicable 140FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) VIII. R&D Expenditures Unit: RMB Item Amount incurred in current period Amount in prior period Employee benefits 33415540.82 25193556.07 Sample and material costs 1317816.72 427397.19 Depreciation and amortization 2463373.05 2484373.63 Technical cooperation expenses 425254.93 1292546.07 Other 3095411.12 3689998.37 Total 40717396.64 33087871.33 Including: Expensed R&D expenditures 40717396.64 33087871.33 Capitalized R&D expenditures 0.00 0.00 1. R&D Projects Qualifying for Capitalization Not applicable 2. Significant Acquired Projects in Progress Not applicable IX. Changes in Scope of Consolidation 1. Business Combinations Not Under Common Control (1) Business combinations not under common control in current period Not applicable (2) Combination costs and goodwill Not applicable (3) Identifiable assets and liabilities of acquirees on acquisition date Not applicable (4) Gains or losses arising from remeasurement of previously held equity at fair value on acquisition date Whether control was obtained through step acquisitions via multiple transactions in the reporting period No (5) Explanations where combination consideration or acquiree's identifiable assets/liabilities fair values cannot be determined reasonably on acquisition date or period-end Not applicable 141FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (6) Other notes Not applicable 2. Business Combinations Under Common Control (1) Business combinations under common control in current period Not applicable (2) Combination costs Not applicable (3) Carrying amounts of combinees' assets and liabilities on merger date Not applicable 3. Reverse Acquisitions Not applicable 4. Disposal of Subsidiaries Whether transactions or events occurred in current period resulting in loss of control over subsidiaries No Whether step disposals of investments in subsidiaries occurred resulting in loss of control in current period No 5. Changes in Consolidation Scope for Other Reasons Not applicable 6. Other Not applicable X. Interests in Other Entities 1. Interests in Subsidiaries (1) Composition of the corporate group Unit: RMB Subsidiary Name Registered Princip Place Nature Shareholding Acquisitioncapital al of of percentage Method 142FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Place Regist Busine of ration ss Busine Direct Indirect ss Shenzhen Harmony World 600000000.00 Shenzh Shenz Comm 100.00 Establishme Watch Center Co. Ltd. en hen erce % nt orinvestment Establishme FIYTA Sales Co. Ltd. 450000000.00 Shenzh Shenz Comm 100.00en hen erce % nt orinvestment Shenzhen FIYTA Precision 180000000.00 Shenzh Shenz Manufa Establishme Technology Co. Ltd. en hen cturing 99.44% 0.56% nt orinvestment Shenzhen FIYTA Technology Shenzh Shenz Manufa 100.00 Establishme Development Co. Ltd. 50000000.00 en hen cturing % nt orinvestment Harmony World Watch Center Establishme (Hainan) Co. Ltd. 10000000.00 Sanya Sanya Comm 100.00 erce % nt orinvestment Shenzhen Xunhang Precision 10000000.00 Shenzh Shenz Manufa 100.00 Establishme Technology Co. Ltd. en hen cturing % nt orinvestment Emile Chouriet Horlogerie Establishme (Shenzhen) Co. Ltd. 41355200.00 Shenzh Shenz Comm 100.00 en hen erce % nt orinvestment Business Liaoning Hengdarui Shenya Sheny Comm 100.00 combination Commercial & Trade Co. Ltd. 51000000.00 ng ang erce % undercommon control Shiyuehui Boutique (Shenzhen) Establishme Co. Ltd. 5000000.00 Shenzh Shenz Comm 100.00 en hen erce % nt orinvestment Shenzhen Harmony E- Shenzh Shenz Comm 100.00 Establishme Commerce Co. Ltd. 10000000.00 en hen erce % nt orinvestment Establishme FIYTA (Hong Kong) Limited 137737520.00 Hong Hong Comm 100.00Kong Kong erce % nt orinvestment Business Montres 97958426.10 Switzer Switze Manufa 100.00 combination Chouriet SA land rland cturing % not undercommon control Explanation of difference between shareholding percentage and voting rights percentage in subsidiaries: Not applicable Basis for controlling investees with half or less voting rights or not controlling investees with over half voting rights: Not applicable Basis for control over significant structured entities included in consolidation scope: Not applicable Basis for determining whether the Company is a principal or an agent: Not applicable Other notes: 143FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Not applicable (2) Significant non-wholly-owned subsidiaries Not applicable (3) Key financial information of significant non-wholly-owned subsidiaries Not applicable (4) Material restrictions on using corporate group assets and settling group debts Not applicable (5) Financial or other support provided to structured entities included in consolidated statements Not applicable 2. Transactions Resulting in Changes in Owners' Equity Shares in Subsidiaries Without Loss of Control (1) Description of changes in owners' equity shares in subsidiaries Not applicable (2) Impact of transactions on non-controlling interests and equity attributable to owners of the parent company Not applicable 3. Interests in Joint Ventures or Associates (1) Significant joint ventures or associates Not applicable (2) Key financial information of significant joint ventures Not applicable (3) Key financial information of significant associates Not applicable (4) Aggregate financial information of insignificant joint ventures and associates Unit: RMB 144FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Ending balance / Amount in current Beginning balance / Amount in prior period period Joint ventures: Aggregate amounts calculated in proportion to shareholding Associates: Total carrying amount of investments 46672153.60 46436556.86 Aggregate amounts calculated in proportion to shareholding -- Net profit 942386.98 1978180.55 -- Total comprehensive income 942386.98 1978180.55 (5) Explanation of significant restrictions on the ability of joint ventures or associates to transfer funds to the Company Not applicable (6) Excess losses incurred by joint ventures or associates Not applicable (7) Unrecognized commitments related to investments in joint ventures Not applicable (8) Contingent liabilities related to investments in joint ventures or associates Not applicable 4. Significant Joint Operations Not applicable 5. Interests in Structured Entities Not Included in Consolidated Financial Statements Not applicable 6. Other Not applicable XI. Government Grants 1. Government Grants Recognized as Receivables at Period-End Not applicable 145FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 2. Liabilities Items Involving Government Grants Not applicable 3. Government Grants Recognized in Current Profit or Loss Unit: RMB Accounting Line Item Amount incurred in current period Amount in prior period Other income 1916497.10 1509835.03 XII. Risks Related to Financial Instruments 1. Various Risks Arising from Financial Instruments Risks related to financial instruments arise from various financial assets and liabilities recognized by the Company in the course of operations including credit risk liquidity risk and market risk.The Company's management is responsible for formulating risk management objectives and policies related to financial instruments. The operational management is responsible for routine risk management through functional departments (for example the Company's Credit Management Department reviews credit sales on a transaction-by- transaction basis). The Company's Internal Audit Department conducts regular monitoring of the implementation of risk management policies and procedures and reports findings promptly to the Audit Committee.The overall objective of the Company's risk management is to formulate risk management policies that minimize risks related to financial instruments without unduly compromising the Company's competitiveness and resilience. 1. Credit risk Credit risk refers to the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. The Company's credit risk arises mainly from monetary funds notes receivable accounts receivable receivables financing etc. The credit risk of these financial assets stems from counterparty defaults with the maximum exposure equal to the carrying amounts of these instruments.The Company's monetary funds are mainly deposited in commercial banks and other financial institutions that the Company considers to possess high credit standing and strong asset positions thus presenting low credit risk.For notes receivable accounts receivable and receivables financing the Company implements policies to control credit risk exposure. The Company assesses customers' credit qualifications and establishes credit periods based on their financial standing the availability of third-party guarantees credit histories and other factors such as prevailing market conditions. The Company regularly monitors customer credit records. For customers with poor credit records it uses written payment reminders shortens credit periods or cancels credit terms to ensure overall credit risk remains controllable. (1) Criteria for determining significant increase in credit risk The Company assesses at each balance sheet date whether credit risk on financial instruments has increased significantly since initial recognition. In determining significant increases in credit risk the Company considers reasonable and supportable information available without undue cost or effort including qualitative and quantitative analyses based on historical data external credit ratings and forward-looking information. On an individual instrument basis or a collective portfolio basis of instruments with similar credit characteristics the Company evaluates changes in default risk over the expected life by comparing default risk at the balance sheet date with that at initial recognition.The Company considers that credit risk has increased significantly when one or more of the following quantitative or qualitative criteria are triggered: Quantitative criteria mainly comprise an increase in the remaining lifetime default 146FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) probability at the reporting date exceeding a specific threshold compared to initial recognition; qualitative criteria include significant adverse changes in the operational or financial condition of major debtors inclusion in early-warning customer lists etc. (2) Definition of credit-impaired financial assets To determine whether credit impairment has occurred the definition criteria adopted by the Company align with internal credit risk management objectives for relevant financial instruments incorporating both quantitative and qualitative indicators.In evaluating whether a debtor is credit-impaired the Company mainly considers the following: significant financial difficulty of the issuer or debtor; A breach of contract by the debtor such as a default or delinquency in interest or principal payments; The creditor for economic or contractual reasons relating to the debtor's financial difficulty granting a concession that would not otherwise be considered; It becoming probable that the debtor will enter bankruptcy or other financial reorganization; The disappearance of an active market for that financial asset because of financial difficulties of the issuer or debtor; The purchase or origination of a financial asset at a deep discount that reflects incurred credit losses.Credit impairment of a financial asset may be caused by the combined effect of multiple events rather than a single identifiable event. (3) Parameters for measuring expected credit losses Depending on whether credit risk has increased significantly and whether credit impairment has occurred the Company measures loss allowances for different assets at 12-month or lifetime ECL. Key parameters for ECL measurement include Probability of Default (PD) Loss Given Default (LGD) and Exposure at Default (EAD). Taking into account quantitative analysis of historical statistical data (such as counterparty ratings guarantee methods collateral types repayment methods) and forward-looking information the Company establishes PD LGD and EAD models.Related definitions are as follows: Probability of Default refers to the likelihood that a debtor will be unable to meet its repayment obligations over the next 12 months or over the remaining lifetime.Loss Given Default refers to the Company's expectation of the extent of loss on default exposure. LGD varies depending on counterparty types recourse methods priority and collateral. LGD is the percentage of exposure lost upon default calculated on a 12-month or lifetime basis; Exposure at Default refers to the amount the Company is entitled to be repaid upon default over the next 12 months or remaining lifetime. The assessment of significant increases in credit risk and the calculation of ECL both involve forward-looking information. Through historical data analysis the Company identifies key economic indicators affecting credit risk and ECL across various business segments.The Company's maximum credit risk exposure equals the carrying amount of each financial asset in the balance sheet. The Company has provided no other guarantees that would expose it to credit risk.In the Company's accounts receivable receivables from the top five customers accounted for 26.50% of the total accounts receivable (comparison period: 21.77%). 2. Liquidity risk Liquidity risk refers to the risk that an enterprise will encounter shortage of funds in meeting obligations settled by delivering cash or other financial assets. The Company oversees cash management across subsidiaries including short-term investment of surplus cash and loan arrangements to meet anticipated cash requirements. The Company's policy is to regularly monitor short- and long-term liquidity requirements and compliance with loan agreements to ensure adequate cash reserves and marketable securities readily convertible to cash.As of June 30 2026 the maturity profile of the Company's financial liabilities was as follows: (Unit: RMB 10000) 147FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) June 30 2026 Item Within 1 year 1-2 years 2-3 years Over 3 years Short-term borrowings - Accounts payable 6884.61 Other payables 7819.55 Non-current liabilities due within one year 4815.53 Lease liabilities 1451.25 22.40 Total 19519.69 1451.25 22.40 - 3. Market risk (1) Foreign exchange risk Except for the Hong Kong subsidiary holding assets denominated in HKD and the Swiss sub-subsidiary holding assets denominated in CHF the Company's other primary business activities are settled mainly in RMB. However foreign exchange risks remain for recognized foreign currency assets and liabilities and future foreign currency transactions (chiefly denominated in HKD and CHF). 1) As of June 30 2026 the Company's foreign currency financial assets and liabilities are set out in Note VII.81 Foreign Currency Monetary Items. 2) Sensitivity analysis As of June 30 2026 assuming all other risk variables remain constant if RMB appreciates or depreciates by 5% against foreign currencies on that date the Company's net profit for the year will increase or decrease by RMB 911000 (comparison period: RMB 741700). (2) Interest rate risk The Company's interest rate risk arises primarily from long-term interest-bearing debts such as long-term bank borrowings and bonds payable. Floating-rate financial liabilities expose the Company to cash flow interest rate risk while fixed-rate financial liabilities expose it to fair value interest rate risk. The Company determines the relative proportions of fixed-rate and floating-rate contracts based on prevailing market conditions.The Finance Department at Company headquarters continuously monitors group interest rate levels. Increases in interest rates raise the cost of new interest-bearing debts and interest expenses on outstanding floating-rate debts posing potential material adverse impacts on financial performance; management makes timely adjustments according to prevailing market conditions.As of June 30 2026 the Company had no long-term interest-bearing debt. 2. Hedging (1) Hedging activities conducted for risk management Not applicable (2) Qualified hedging activities applying hedge accounting Not applicable (3) Hedging activities conducted for risk management expected to achieve objectives without applying hedge accounting Not applicable 148FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 3. Financial Assets (1) Classification by transfer method Not applicable (2) Transferred financial assets derecognized Not applicable (3) Transferred financial assets with continuing involvement Not applicable XIII. Fair Value Disclosures 1. Ending Fair Value of Assets and Liabilities Measured at Fair Value Not applicable 2. Basis for Determining Market Prices for Recurring and Non-recurring Level 1 Fair Value Measurements Not applicable 3. Valuation Techniques and Qualitative/Quantitative Information of Key Parameters for Recurring and Non-recurring Level 2 Fair Value Measurements Not applicable 4. Valuation Techniques and Qualitative/Quantitative Information of Key Parameters for Recurring and Non-recurring Level 3 Fair Value Measurements Not applicable 5. Reconciliation Between Beginning and Ending Carrying Amounts and Sensitivity Analysis of Unobservable Parameters for Recurring Level 3 Fair Value Measurements Not applicable 6. Reasons for Transfers Between Levels and Policies for Determining Transfer Timing for Recurring Fair Value Measurements During Current Period Not applicable 7. Changes in Valuation Techniques and Reasons in Current Period Not applicable 149FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 8. Fair Value of Financial Assets and Liabilities Not Measured at Fair Value Not applicable 9. Other Not applicable XIV. Related Parties and Related-Party Transactions 1. Parent Company of the Enterprise Parent Parent Parent Company Place ofRegistratio Nature of Registered company's company's voting Name Business capital shareholding rightsn percentage in percentage in the enterprise the enterprise Shentian Technology Holding (Shenzhen) Shenzhen Business RMB 1166.1620 Co. Ltd. services million 40.17%40.17% Description of the parent company of the enterprise Shentian Technology Holding (Shenzhen) Co. Ltd. is a wholly-owned subsidiary indirectly held 100.00% by Aviation Industry Corporation of China Ltd.The ultimate controlling party of the enterprise is Aviation Industry Corporation of China Ltd. 2. Subsidiaries of the Enterprise For details of the enterprise's subsidiaries please refer to Note X. Interests in Other Entities. 3. Joint Ventures and Associates of the Enterprise For details of significant joint ventures or associates please refer to Note X. Interests in Other Entities. 4. Other Related Parties Relationship Between Name of Other Related Party Other Related Party and the Enterprise Aviation Industry Corporation of China Ltd. and its subsidiaries (hereinafter "AVIC and its Under control of the subsidiaries") same party Associates of Aviation Industry Corporation of China Ltd. and their subsidiaries Associates of the (hereinafter "AVIC associates and subsidiaries") ultimate controlling party Shanghai Watch Co. Ltd. (hereinafter "Shanghai Watch") Associate of theCompany Directors and Senior Executives of the Company (hereinafter "Key Management Key management Personnel") personnel 150FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 5. Related-Party Transactions (1) Related-party transactions in purchasing/selling goods and rendering/receiving services Purchase of goods / Receipt of services table Unit: RMB Whether Amount exceedin Related Party Content of related-party incurred in Approved g Amount in priortransaction current period transaction limit approved period limit AVIC and its Purchase of goods and subsidiaries payment of related 6033942.79 45000000.00 No 6239244.80expenses AVIC associates and Purchase of goods and subsidiaries payment of related 5170281.43 22000000.00 No 5394613.24expenses Shanghai Watch Purchase of goods 0.00 5000000.00 No 0.00 Total 11204224.22 72000000.00 11633858.04 Sale of goods / Rendering of services table Unit: RMB Related Party Content of related-party transaction Amount incurred Amount in priorin current period period AVIC and its subsidiaries Sale of goods and rendering of services 14566458.05 19627421.48 AVIC associates and subsidiaries Sale of goods and collection of propertymanagement fees 1561409.10 1410539.78 Shanghai Watch Sale of goods and rendering of services 0.00 2018837.18 Total 16127867.15 23056798.44 (2) Related-party entrusted management/contracting and entrustment/subcontracting Not applicable (3) Related-party leasing The Company as lessor: Unit: RMB Lessee Name Type of Leased Lease income recognized Lease income recognizedAsset in current period in prior period AVIC associates and subsidiaries Building 34285.74 25024.53 AVIC and its subsidiaries Building 0.00 281999.98 Total 34285.74 307024.51 The Company as lessee: Unit: RMB Type Rental expenses Variable lease Lessor of for short-term payments not Interest expense Increase in right- Name Lease and low-value included in Rent paid incurred on lease of-use assets d asset leases measurement of liabilities under simplified lease liabilities (if 151FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Asset treatment (if applicable) applicable) Amoun Amoun Amoun Amoun Amoun t Amoun t Amoun t Amoun t Amoun t Amoun incurre t in incurre t in incurre t in incurre t in incurre t in d in prior d in prior d in prior d in prior d in prior current period current period current period current period current period period period period period period AVIC associ ates Buildin 8509. 18422 13933 18280 2531. 2662.and g 09 .90 6.55 6.26 38 55 0.00 0.00 subsidi aries Total 8509. 18422 13933 18280 2531. 2662.09 .90 6.55 6.26 38 55 0.00 0.00 (4) Related-party guarantees Not applicable (5) Capital lending with related parties Not applicable (6) Asset transfer and debt restructuring with related parties Not applicable (7) Key management personnel compensation Not applicable (8) Other related-party transactions The ending deposit balance placed by the Company with AVIC Finance at the end of the period was RMB 625703835.03 with deposit interest received during the year amounting to RMB 1498088.02. 6. Amounts Due to/from Related Parties (1) Receivables items Unit: RMB Ending balance Beginning balance Item Name Related Party Gross carrying Bad debt Gross carrying Bad debt amount provision amount provision Bank deposits AVIC Finance 625703835.03 552559173.96 Notes AVIC and its receivable subsidiaries 200546.78 152FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) AVIC and its Accounts subsidiaries 5015909.19 250795.46 5142670.67 530714.66 receivable AVIC associates and subsidiaries 3000.00 150.00 AVIC and its Other subsidiaries 787957.00 39397.85 867917.00 43395.85 receivables AVIC associates and subsidiaries 77990.00 3899.50 77990.00 3899.50 (2) Payables items Unit: RMB Item Name Related Party Ending gross carrying Beginning gross carryingamount amount Other payables AVIC associates and subsidiaries 892941.08 892941.08 Accounts payable AVIC and its subsidiaries 188201.87 37471.91 Advances from AVIC associates and subsidiaries 3396.29 0.00 customers AVIC and its subsidiaries 11250.00 11250.00 7. Related-Party Commitments Not applicable 8. Other Not applicable XV. Share-Based Payments 1. General Overview of Share-Based Payments Not applicable 2. Equity-Settled Share-Based Payments Not applicable 3. Cash-Settled Share-Based Payments Not applicable 4. Share-Based Payment Expenses in Current Period Not applicable 5、Modifications and Terminations of Share-Based Payments Not applicable 153FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 6、Other Not applicable XVI. Commitments and Contingencies 1. Significant Commitments Significant commitments existing at the balance sheet date Significant external commitments and impacts existing at the balance sheet date represent lease contracts signed that are being executed or ready to be executed and their financial impacts; please refer to Note VII.47 Lease Liabilities and Note VII.82 Leases.Except for the aforementioned commitments as of June 30 2026 the Company had no other significant commitments required to be disclosed. 2. Contingencies (1) Significant contingencies existing at balance sheet date Not applicable (2) Statement where the Company has no significant contingencies to disclose The Company has no significant contingencies required to be disclosed. 3. Other Not applicable XVII. Events After Balance Sheet Date 1. Significant Non-Adjusting Events Not applicable 2. Profit Distribution Not applicable 3. Sales Returns Not applicable 4. Other Events After Balance Sheet Date Not applicable 154FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) XVIII. Other Significant Events 1. Correction of Prior-Period Accounting Errors (1) Retrospective restatement method Not applicable (2) Prospective application method Not applicable 2. Debt Restructuring Not applicable 3. Asset Swaps (1) Non-monetary asset exchanges Not applicable (2) Other asset swaps Not applicable 4. Annuity Plan Not applicable 5. Discontinued Operations Not applicable 6. Segment Information (1) Basis for determining reportable segments and accounting policies The Company determines operating segments based on internal organizational structure management requirements and internal reporting systems. An operating segment of the Company refers to a component that simultaneously meets the following criteria: (1) It can generate revenues and incur expenses in daily activities; (2) Management can regularly review its operating results to allocate resources and assess performance; (3) Accounting information regarding its financial position operating results cash flows etc. is available. The Company determines reportable segments based on operating segments; an operating segment meeting one of the following criteria is determined as a reportable segment: (1) Segment revenue accounts for 10% or more of total revenue of all segments; 155FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (2) The absolute amount of its segment profit (loss) accounts for 10% or more of the greater of the absolute total profit of all profitable segments and the absolute total loss of all loss-making segments.The Company operates in a single line of business primarily the manufacture and sale of watches. Management treats this business as a whole to manage and evaluate operating results; therefore no segment information is presented in these financial statements. (2) Financial information of reportable segments Not applicable (3) Explanation where the Company has no reportable segments or cannot disclose total assets and liabilities of each reportable segment Not applicable (4) Other notes Not applicable 7. Other Significant Transactions and Events Affecting Investor Decisions Not applicable 8. Other Not applicable XIX. Notes to Major Items in Financial Statements of the Parent Company 1. Accounts Receivable (1) Disclosure by aging Unit: RMB Aging Ending gross carrying amount Beginning gross carrying amount Within 1 year (inclusive) 20197101.17 10466091.51 1 to 2 years 1450358.55 1637255.79 2 to 3 years 251144.16 Over 3 years 319.04 319.04 3 to 4 years 319.04 4 to 5 years 319.04 Total 21898922.92 12103666.34 156FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) (2) Disclosure by bad debt provision method Unit: RMB Ending balance Beginning balance Categor Gross carryingamount Bad debt provision Gross carrying Carryin y amount Bad debt provision Carryin g g Amount Proporti Amount Provisio amount Amount Proporti Amount Provisio amounton n ratio on n ratio Account s receiva ble with bad debt 22795 10.41% 19929 87.43% 286540 23035 19.03% 19705 332995provisio 38.09 97.55 .54 65.35 70.09 85.54% .26 n accrued on an individu al basis Inclu ding: Account s receiva ble with bad debt 19619 73873. 19545 98001 149885 96502 provisio 384.83 89.59% 30 0.38% 511.53 00.99 80.97% .53 1.53% 15.46 n accrued on a portfolio basis Inclu ding: Receiva bles from 14774 6.75% 73873. 5.00% 14035 46320 38.27% 149885 3.24% 44821custom 66.73 30 93.43 24.39 .53 38.86 ers portfolio Related -party portfolio within 18141 82.84% 18141 51680 51680 consoli 918.10 918.10 76.60 42.70%76.60 dation scope Total 21898 100.00 20668922.92 % 70.85 9.44% 1983212103100.002120499832 052.07666.34%55.6217.52%10.72 Category of individual bad debt provision: Receivables from customers Unit: RMB 157FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Beginning balance Ending balance Name Gross Gross carrying Bad debt carrying Bad debt Provision ratio Reason for amount provision amount provision provision Receivables from 2303565.35 1970570.09 2279538.09 1992997.55 87.43% Expected customers uncollectible Total 2303565.35 1970570.09 2279538.09 1992997.55 Category of portfolio bad debt provision: Receivables from customers Unit: RMB Ending balance Name Gross carrying amount Bad debt provision Provision ratio Receivables from customers portfolio 1477466.73 73873.30 5.00% Total 1477466.73 73873.30 Basis for determining the portfolio: Receivables of the same type share similar credit risk characteristics.Category of portfolio bad debt provision: Related parties within consolidation scope portfolio Unit: RMB Ending balance Name Gross carrying amount Bad debt provision Provision ratio Related-party portfolio within consolidation scope 18141918.10 0.00 0.00% Total 18141918.10 0.00 Basis for determining the portfolio: Receivables of the same type share similar credit risk characteristics.If the general expected credit loss model is adopted for accounts receivable bad debt provision: Not applicable (3) Bad debt provision accrued recovered or reversed in current period Accrual of bad debt provisions in current period: Unit: RMB Amount changed in current period Category Beginning Endingbalance Accrued Recovered or balancereversed Written off Other Accounts receivable with ECL accrued on an 1970570.09 39948.76 17521.30 1992997.55 individual basis Accounts receivable with ECL 149885.53 -76012.23 73873.30 accrued on a 158FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) portfolio basis Total 2120455.62 -36063.47 17521.30 2066870.85 (4) Accounts receivable actually written off in current period Not applicable (5) Top five accounts receivable and contract assets grouped by debtor at period-end Unit: RMB Proportion of Ending balance Ending balance Ending balance Ending balance total ending of accounts receivable bad Entity Name of accounts of contract of accounts balance of receivable assets receivable and accounts debt provision contract assets receivable and and contract contract assets asset impairmentprovision Summary of top five accounts receivable 20120876.20 20120876.20 91.88% 1509224.62 ending balances Total 20120876.20 20120876.20 91.88% 1509224.62 2. Other Receivables Unit: RMB Item Ending balance Beginning balance Other receivables 361944183.93 545751274.33 Total 361944183.93 545751274.33 (1) Interest receivable 1) Classification of interest receivable Not applicable 2) Significant overdue interest Not applicable 3) Disclosure by bad debt provision method Not applicable 4) Bad debt provision accrued recovered or reversed in current period Not applicable 159FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 5) Interest receivable actually written off in current period Not applicable (2) Dividends receivable 1) Classification of dividends receivable Not applicable 2) Significant dividends receivable aged over 1 year Not applicable 3) Disclosure by bad debt provision method Not applicable 4) Bad debt provision accrued recovered or reversed in current period Not applicable 5) Dividends receivable actually written off in current period Not applicable (3) Other receivables 1) Classification of other receivables by nature Unit: RMB Nature of payment Ending gross carrying amount Beginning gross carrying amount Amounts due from related parties within consolidation scope 361147308.88 545517289.16 Deposits and security deposits 46992.02 61809.82 Employee petty cash 88346.00 0.00 Other 703586.96 212878.18 Total 361986233.86 545791977.16 2) Disclosure by aging Unit: RMB Aging Ending gross carrying amount Beginning gross carrying amount Within 1 year (inclusive) 361933127.23 545738870.53 1 to 2 years 2 to 3 years 13056.63 Over 3 years 53106.63 40050.00 3 to 4 years 13056.63 160FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 4 to 5 years Over 5 years 40050.00 40050.00 Total 361986233.86 545791977.16 3) Disclosure by bad debt provision method Unit: RMB Ending balance Beginning balance Categor Gross carrying Bad debt provision Gross carryingamount Carryin amount Bad debt provision Carryiny g g Amount Proporti Amount Provisio amount Amount Proporti Amount Provisio amounton n ratio on n ratio Account s receiva ble with bad debt provisio n accrued on an individu al basis Includin g: Accrue d on a 361986 100.00 42049. 361944 545791 100.00 40702. 545751 portfolio 233.86 % 93 0.01% 183.93 977.16 % 83 0.01% 274.33 basis Includin g: Portfoli o of receiva bles from related 361147 361147 545517 545517 parties 308.88 99.77%0.000.00%308.88289.1699.95%0.000.00%289.16 within consoli dation scope Deposit s and security 46992. 0.01% 40397. 85.97% 6594.9 61809. 0.01% 40673. 21136.deposit 02 10 2 82 05 65.80% 77 s portfolio Other receiva 791932 0.22% 1652.8 0.21% 790280 212878 212848bles .96 3 .13 .18 0.04% 29.78 0.01% .40 portfolio 161FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Total 361986 100.00 42049. 0.01% 361944 545791 100.00 40702.233.86 % 93 183.93 977.16 % 83 0.01% 545751 274.33 Category of portfolio bad debt provision: Deposits and security deposits portfolio Unit: RMB Ending balance Name Gross carrying amount Bad debt provision Provision ratio Deposits and security deposits portfolio 46992.02 40397.10 85.97% Total 46992.02 40397.10 Basis for determining the portfolio: Receivables of the same nature share similar credit risk characteristics.Category of portfolio bad debt provision: Other receivables portfolio Unit: RMB Ending balance Name Gross carrying amount Bad debt provision Provision ratio Other receivables portfolio 791932.96 1652.83 0.21% Total 791932.96 1652.83 Basis for determining the portfolio: Receivables of the same nature share similar credit risk characteristics.Bad debt provision accrued under the general expected credit loss model: Unit: RMB Stage 1 Stage 2 Stage 3 Bad debt provision 12-month Lifetime expected credit Total expected credit losses (not credit- Lifetime expected credit losses impaired) losses (credit-impaired) Balance as of January 1 202640702.8340702.83 Balance as of January 1 2026 in current period -- Transfer to Stage 2 -- Transfer to Stage 3 -- Reverse to Stage 2 -- Reverse to Stage 1 Accrual in current period 1347.10 1347.10 Reversal in current period Written off in current period Charged off in current period Other changes Balance as of June 30 202642049.9342049.93 Basis for stage division and bad debt provision accrual ratios Stage 1 represents bad debt provisions for other receivables aged within 1 year; Stage 2 represents bad debt provisions for accounts receivable aged over 1 year without individual assessment; Stage 3 represents bad debt provisions accrued on an individual assessment basis.Significant changes in gross carrying amounts affecting changes in loss allowances Not applicable 162FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 4) Bad debt provision accrued recovered or reversed in current period Accrual of bad debt provisions in current period: Unit: RMB Amount changed in current period Category Beginning Endingbalance Accrued Recovered or balancereversed Write-off Other Accrued on a portfolio basis 40702.83 1347.10 42049.93 Total 40702.83 1347.10 42049.93 5) Other receivables actually written off in current period Not applicable 6) Top five other receivables grouped by debtor at period-end Unit: RMB Entity Proportion of total Ending Name Nature of payment Ending balance Aging ending balance of balance of other receivables bad debtprovision Portfolio of receivables from First related parties within 267673632.07 Within 1year 73.95% 0.00consolidation scope Portfolio of receivables from Second related parties within 60366112.14 Within 1 consolidation scope year 16.68%0.00 Portfolio of receivables from Third related parties within 27107564.67 Within 1 consolidation scope year 7.49%0.00 Portfolio of receivables from Fourth related parties within 6000000.00 Within 1 1.66% 0.00 consolidation scope year Fifth Deposits receivable 40000.00 Over 3years 0.01% 40000.00 Total 361187308.88 99.79% 40000.00 7) Presented in other receivables due to centralized cash management Not applicable 3. Long-Term Equity Investments Unit: RMB Ending balance Beginning balance Item Gross carrying Impairment Carrying Gross carrying Impairment Carrying amount provision amount amount provision amount Investments in 1592543885 1592543885. 1592543885 1592543885 163FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) subsidiaries .91 91 .91 .91 Investments in associates and joint 46672153.60 46672153.60 46436556.86 46436556.86 ventures Total 1639216039 1639216039. 1638980442 1638980442.51 51 .77 .77 (1) Investments in subsidiaries Unit: RMB Beginning Beginning Changes in current period Ending Ending Investee balance balance of Additional Impairmen balance balance of(carrying impairmen investmen Investment reduction t provision Other (carrying impairmen amount) t provision t accrued amount) t provision Shenzhen Harmony World 6098919 6098919 Watch 73.62 73.62 Center Co. Ltd.Shenzhen Harmony E- 1168448 1168448 Commerc 4.39 4.39 e Co. Ltd.Shenzhen FIYTA Precision 1822908 1822908 Technolog 34.31 34.31 y Co. Ltd.Shenzhen FIYTA Technolog y 5116014 5116014 Developm 1.67 1.67 ent Co.Ltd.FIYTA (Hong 1377375 1377375 Kong) 20.00 20.00 Limited Shiyuehui Boutique (Shenzhe 5000000. 5000000.n) Co. 00 00 Ltd.FIYTA Sales Co. 4572971 4572971 Ltd. 83.13 83.13 Liaoning Hengdarui Commerci 3686784 3686784 al & Trade 3.96 3.96 Co. Ltd. 164FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Emile Chouriet Horlogerie 8061390 8061390 (Shenzhe 4.83 4.83 n) Co.Ltd.Harmony World Watch 1000000 1000000 Center 0.00 0.00 (Hainan) Co. Ltd.Shenzhen Xunhang Precision 1000000 1000000 Technolog 0.00 0.00 y Co. Ltd.Total 1592543 1592543885.91 885.91 (2) Investments in associates and joint ventures Unit: RMB Changes in current period Begin Begin Invest Endin Endin ning ning ment Other g g balan balan incom compr Cash Impair balan balan Invest ce ce of Additi Invest e/loss ehens Other divide ment ce ce of ee (carryi impair onal ment recog ive equity nds or provisi (carryi impair ng ment invest reduct nized incom chang profits on Other ng ment amou provisi ment ion under e es declar accru amou provisi nt) on equity adjust ed ed nt) on metho ments d I. Joint ventures II. Associates Shang hai 4643 2355 4667Watch 6556.Co. 86 96.74 2153. 60 Ltd.Subtot 4643 4667 al 6556. 2355 96.742153.8660 46434667 Total 6556. 2355 8696.74 2153. 60 (3) Other notes Not applicable 165FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) 4. Operating Revenue and Operating Costs Unit: RMB Amount incurred in current period Amount in prior period Item Revenue Costs Revenue Costs Principal businesses 78346349.63 41246617.92 79218866.11 25511651.20 Other businesses 2193360.67 2255957.31 Total 80539710.30 41246617.92 81474823.42 25511651.20 5. Investment Income Unit: RMB Item Amount incurred in current period Amount in prior period Investment income from long-term equity investments under cost 153354622.33 0.00 method Investment income from long-term equity investments under equity 235596.74 494545.14 method Total 153590219.07 494545.14 6. Other Not applicable XX. Supplementary Information 1. Statement of Current Non-recurring Profit or Loss Unit: RMB Item Amount Description Gains and losses on disposal of non-current assets 474063.48 Government grants recognized in current profit or loss (excluding those closely related to the Company's normal operating business complying with national policies and regulations enjoyed in accordance with established standards and 1916497.10 having a continuing impact on the Company's profit or loss) Fair value change gains and losses arising from holding financial assets and financial liabilities by non-financial enterprises and gains and losses from disposal of financial assets and financial liabilities except for effective hedging activities 394557.22 related to the Company's normal business operations Reversal of impairment provision for receivables tested for impairment individually 1390273.53 Other non-operating income and expenses other than the above items 252866.81 Less: Income tax effect 763108.21 Total 3665149.93 -- Specific circumstances of other profit or loss items that meet the definition of non-recurring profit or loss: Not applicable 166FIYTA Precision Technology Co. Ltd. 2026 Interim Report (Full Text) Explanation of defining non-recurring profit or loss items listed in "Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Securities to the Public — Non-recurring Profit or Loss" as recurring profit or loss items Not applicable 2. Return on Equity and Earnings Per Share Earnings Per Share Profit in Reporting Period Weighted average returnon equity (ROE) Basic earnings per share Diluted earnings per share (RMB/share) (RMB/share) Net profit attributable to ordinary shareholders of 2.98% 0.2477 0.2477 the Company Net profit attributable to ordinary shareholders of the Company after 2.87% 0.2387 0.2387 deducting non-recurring profit or loss 3. Differences in Accounting Data Under Domestic and Foreign Accounting Standards (1) Differences in net profit and net assets in financial reports disclosed simultaneously under IFRS and CAS Not applicable (2) Differences in net profit and net assets in financial reports disclosed simultaneously under foreign accounting standards and CAS Not applicable （3） Explanation of reasons for accounting data differences under domestic and foreign accounting standards including the name of overseas auditing firm if overseas audited data are reconciled Not applicable 4. Other Not applicable FIYTA Precision Technology Co. Ltd.Board of Directors August 21 2026 167