Company: FSTWF
Filing Date: 2025-02-28
Form Type: F-1
Source: 0001213900-25-018264
Chunk: 66

Company: FST Corp.
Filing Date: 2025-02-28
Form: F-1
Chunk 66
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 Group provided software service to Factory Automation Technology Co., Ltd., a related party, and purchased related software from Parametric Technology Corporation, a third party. The Group recorded the software service income as other income and recorded software purchase fee as research and development expenses for the six months ended June 30, 2023. In fiscal year 2024, Group became an authorized agent of Parametric Technology Corporation to resell its software and the Group recorded the software service income as revenue according to ASC 606 and recorded the software purchase fee as cost of sales accordingly. This reclassification accounts for the 17.3% decrease in FST’s R&D expenses and reflects the FST’s evolving role from a software user to a distributor. Other Income Other income increased by $75,153, or 9.2%, from $814,139 for the six months ended June 30, 2023 to $889,292 for the six months ended June 30, 2024. The increase was mainly due to the increase of the foreign exchange rate gain of $699,001 due to more efficient capital arrangement, and partially offset by the increase of net interest expense of $435,982. Income Tax Expenses Income tax expenses was $167,450 and $5,184 for the six months ended June 30, 2024 and 2023, which was mainly due to the increase of taxable income. 42

Comparison of Results of Operations for the Year Ended December 31, 2023 to the Year Ended December 31, 2022 The table below sets forth the results of operations for the year ended December 31, 2023 and the year ended December 31, 2022:

|                                         |     | For the Years Ended 
 December 31,        |       2023 |   |     |   |       2022 |   |
|:----------------------------------------|:----|:--------------------|-----------:|:--|:----|:--|-----------:|:--|
| Revenue                                 |     | $                   | 28,730,549 |   |     | $ | 49,779,465 |   |
| Cost of sales                           |     |                     | 15,287,532 |   |     |   | 23,207,116 |   |
| Gross profit                            |     |                     | 13,443,017 |   |     |   | 26,572,349 |   |
| COSTS AND OPERATING EXPENSE