TRIO-TECH INTERNATIONAL 10-K

ITEM 9A – CONTROLS AND PROCEDURES An evaluation was carried out by the Company’s Chief Executive Officer and Chief Financial Officer (the principal executive and principal financial officers, respectively, of the Company) of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) or 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended) as of June 30, 2025, the end of the period covered by this Form 10-K. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of June 30, 2025. Additionally, management has the responsibility for establishing and maintaining adequate internal control over financial reporting for the Company and thus also assessed the effectiveness of our internal controls over financial reporting as of June 30, 2025. Management used the framework set forth in the report entitled “Internal Control – Integrated Framework” published by the Committee of Sponsoring Organizations of the Treadway Commission in 2013 to evaluate the effectiveness of the Company’s internal control over financial reporting. 24 Table of Contents Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purpose in accordance with U.S. generally accepted accounting principles, and includes those policies and procedures that: 1. Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; 2. Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorization of management and directors of the Company; and 3. Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition and use or disposition of the Company’s assets that could have a material effect on the financial statements. Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations. Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper management override. Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, the risk. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s internal controls over financial reporting were effective as of June 30, 2025. Changes in Internal Control Over Financial Reporting There has been no change in the Company’s internal control over financial reporting during the fourth quarter of Fiscal 2025, which were identified in connection with management’s evaluation required by paragraph (d) of rules 13a-15 and 15d-15 under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. ITEM 9B – OTHER INFORMATION On September 17, 2025, the Company and Lodestar Enterprise Sdn. Bhd. (“ Lodestar ”) entered into an Equity Purchase Agreement (“ Agreement ”) pursuant to which the Company, through its wholly-owned subsidiary, Trio-Tech International Pte. Ltd (Singapore) (“ Trio-Tech Singapore ”) agreed to acquire from Lodestar the remaining 50% of the total share capital of Trio-Tech (Malaysia) Sdn. Bhd. owned by Lodestar and not already owned by Trio-Tech Singapore (the “ Acquisition ”). The Acquisition is subject to conditions to closing, including approval of the Acquisition by the Ministry of Investment, Trade and Industry in Malaysia. The purchase price for the Acquisition is RM14,200 payable in cash, or approximately $3,357 USD. Upon consummation of the Acquisition, the Company will indirectly through Trio-Tech Singapore own 100% of the share capital of Trio-Tech Malaysia. The foregoing description of the Agreement does not purport to be complete and is qualified in its entirety by the full text of each of the Agreement, a copy of which is filed hereto as Exhibit 10.6 and is incorporated by reference herein. The Agreement contains representations, warranties and covenants of each of the parties thereto that are customary for transactions of this type, and such representations, warrants, and covenants were made to each other as of the date of the Agreement or other specific dates. The assertions embodied in those representations, warranties and covenants were made for purposes of the contract among the respective parties and are subject to important qualifications and limitations agreed to by the parties in connection with negotiating the Agreement. The Agreement is incorporated herewith to provide investors with information regarding its terms. It is not intended to provide any other factual information about the parties to the Agreement. In particular, the representations, warranties, covenants and agreements contained in the Agreement, which were made only for purposes of the Agreement and as of specific dates, were solely for the benefit of the parties to the Agreement, may be subject to limitations agreed upon by the contracting parties and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors, security holders and reports and documents filed with the Securities and Exchange Commission ( “ SEC ”) . In addition, the representations, warranties, covenants and agreements and other terms of the Agreement may be subject to subsequent waiver or modification. ITEM 9C – DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable. 25 Table of Contents PART III The information required by Items 10 through 14 of Part III of this Form 10 -K (information regarding our directors and executive officers, executive compensation, security ownership of certain beneficial owners, management, related stockholder matters, and certain relationships and related transactions and principal accountant fees and services) is hereby incorporated by reference from the Company's Proxy Statement to be filed with the Securities and Exchange Commission within 120 days of June 30, 2025 . PART IV ITEM 15 – EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a) (1 and 2) FINANCIAL STATEMENTS AND SCHEDULES: The following financial statements, including notes thereto and the independent auditors' report with respect thereto, are filed as part of this Annual Report on Form 10‑K, starting on page 34 hereof: 1. Report of Independent Registered Public Accounting Firm (PCAOB ID 2136) 2. Consolidated Balance Sheets 3. Consolidated Statements of Operations and Comprehensive Income (Loss) 4. Consolidated Statements of Shareholders' Equity 5. Consolidated Statements of Cash Flows 6. Notes to Consolidated Financial Statements (b) The exhibits filed as part of this Annual Report on Form 10K are set forth on the Exhibit Index immediately preceding such exhibits and are incorporated herein by reference. 26 Table of Contents ITEM 16 – FORM 10-K SUMMARY Not applicable. 27 Table of Contents EXHIBITS: Number Description 3.1 Articles of Incorporation of Trio-Tech International, as currently in effect. (Incorporated by reference to Exhibit 3.1 to the Registrant’s Annual Report on Form 10 ‑K for June 30, 1988) 3.2 Second Amended and Restated Bylaws of Trio-Tech International (Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed December 13, 2023) 4.1 Description of Registrant’s Securities 10.1 2017 Employee Stock Option Plan (Incorporated by reference to Appendix 1 to the Registrant’s Proxy Statement for its Annual Meeting held December 4, 2017.)** 10.2 2017 Directors Equity Incentive Plan (Incorporated by reference to Appendix 2 to the Registrant’s Proxy Statement for its Annual Meeting held December 4, 2017.)** 10.3 Amendment to 2017 Directors Equity Incentive Plan* 10.4 Joint Venture Agreement between Trio-Tech SIP Co., Ltd and Suzhou Anchuang Technology Management LLP dated December 1, 2021 (Incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, filed February 13, 2022) 10.5 Equity Transfer Agreement between Suzhou Anchuang Technology Management LLP and Trio-Tech (SIP) Co. Ltd 10.6+ Equity Purchase Agreement between Trio-Tech international Pte Ltd and Lodestar Enterprise Sdn Bhd. 21.1 Subsidiaries* 23.1 Consent of Independent Registered Public Accounting Firm* 31.1 Rule 13a-14(a) Certification of Principal Executive Officer of Registrant* 31.2 Rule 13a-14(a) Certification of Principal Financial Officer of Registrant* 32 Section 1350 Certification.* 97.1 Trio-Tech International Clawback Policy 101.INS The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.* 101.SCH Inline XBRL Taxonomy Extension Schema* 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase* 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase* 101.LAB Inline XBRL Taxonomy Extension Label Linkbase* 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase* 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)* * Filed electronically herewith. ** Indicates management contracts or compensatory plans or arrangements required to be filed as an exhibit to this report. +Certain portions of this exhibit (indicated by “[***]”) have been omitted as the Company has determined (i) the omitted information is not material and (ii) the omitted information would likely cause harm to the Company if publicly disclosed. 28 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. TRIO‑TECH INTERNATIONAL By: /s/ Srinivasan Anitha Srinivasan Anitha Chief Financial Officer September 19, 2025 Pursuant to the requirement of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacity and on the dates indicated. By: /s/ S.W.Yong S. W. Yong, Director Chairman and Chief Executive Officer (Principal Executive Officer) September 19, 2025 By: /s/ Srinivasan Anitha Srinivasan Anitha Chief Financial Officer (Principal Financial Officer) September 19, 2025 By: /s/ Jason T. Adelman Jason T. Adelman, Director September 19, 2025 By: /s/ Richard M. Horowitz Richard M. Horowitz, Director September 19, 2025 By: /s Victor Ting Hock Ming Victor Ting Hock Ming, Director September 19, 2025 29 Table of Contents INDEX TO FINANCIAL STATEMENTS Report of independent registered public account ing f irm (PCAOB ID 2136) F-1 Consolidated Balance Sheets as of June 30, 2025 and 2024 F-3 Consolidated Statements of Operations and Comprehensive Incom e for th e Years Ended June 30, 2025 and 2024 F-4 Consolidated Statements of Shareholders’ Equity for the Years Ended June 30, 2025 and 2024 F-6 Consolidated Statements of Cash Flows for the Years Ended June 30, 2025 and 2024 F-7 Notes to Consolidated Financial Statements F-8 30 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors of Trio Tech International Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Trio-Tech International and its Subsidiaries (the “Company”) as of June 30, 2025 and 2024, and the related consolidated statements of operations and comprehensive income (loss), shareholders’ equity and cash flows for each of the two years in the period ended June 30, 2025 and 2024, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of June 30, 2025 and 2024, and the consolidated results of its operations and its cash flows for each of the two years in the period ended June 30, 2025 and 2024, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. F-1 Table of Contents Critical Audit Matter Critical audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters. FORVIS MAZARS LLP (FORMERLY KNOWN AS MAZARS LLP) PUBLIC ACCOUNTANTS AND CHARTERED ACCOUNTANTS We have served as the company’s auditors since 2009 /s/ Forvis Mazars LLP Singapore September 19, 2025 PCAOB ID Number 2136 F-2 Table of Contents TRIO-TECH INTERNATIONAL AND SUBSIDIARIES AUDITED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT NUMBER OF SHARES) June 30, June 30, 2025 2024 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 10,890 $ 10,035 Short-term deposits 5,817 6,497 Trade accounts receivable, less allowance for expected credit losses of $ 35 and $ 209 , respectively 10,804 10,661 Other receivables 608 541 Inventories, less provision for obsolete inventories of $ 851 and $ 679 , respectively 2,262 3,162 Prepaid expense and other current assets 384 536 Restricted term deposits 816 750 Total current assets 31,581 32,182 NON-CURRENT ASSETS: Deferred tax assets 91 124 Investment properties, net 345 407 Property, plant and equipment, net 6,021 5,937 Operating lease right-of-use assets 864 1,887 Other assets 231 232 Restricted term deposits 1,935 1,771 Total non-current assets 9,487 10,358 TOTAL ASSETS $ 41,068 $ 42,540 LIABILITIES CURRENT LIABILITIES: Lines of credit $ 141 $ - Accounts payable 1,896 3,175 Accrued expense 3,036 3,634 Contract liabilities 250 754 Income taxes payable 122 379 Current portion of bank loans payable 256 261 Current portion of finance leases 43 57 Current portion of operating leases 540 1,162 Total current liabilities 6,284 9,422 NON-CURRENT LIABILITIES: Bank loans payable, net of current portion 428 613 Finance leases, net of current portion - 34 Operating leases, net of current portion 324 725 Income taxes payable, net of current portion - 141 Deferred tax liabilities 10 - Other non-current liabilities 31 27 Total non-current liabilities 793 1,540 TOTAL LIABILITIES $ 7,077 $ 10,962 EQUITY TRIO-TECH INTERNATIONAL’S SHAREHOLDERS’ EQUITY: Common stock, no par value, 15,000,000 shares authorized; 4,312,805 and 4,250,305 shares issued outstanding as of June 30, 2025 and 2024, respectively $ 13,490 $ 13,325 Paid-in capital 5,979 5,531 Accumulated retained earnings 12,037 11,813 Accumulated other comprehensive income-translation adjustments 2,522 660 Total Trio-Tech International shareholders’ equity 34,028 31,329 Non-controlling interest ( 37 ) 249 TOTAL EQUITY $ 33,991 $ 31,578 TOTAL LIABILITIES AND EQUITY $ 41,068 $ 42,540 See notes to consolidated financial statements. F-3 Table of Contents TRIO-TECH INTERNATIONAL AND SUBSIDIARIES AUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (IN THOUSANDS, EXCEPT EARNINGS PER SHARE) For the Year Ended June 30, 2025 2024 Revenue Semiconductor Back-end Solutions $ 24,682 $ 30,111 Industrial Electronics 11,756 12,176 Others 35 25 36,473 42,312 Cost of Sales 27,329 31,550 Gross Margin 9,144 10,762 Operating Expense: General and administrative 7,890 8,387 Selling 718 844 Research and development 384 392 (Gain) / Loss on disposal of property, plant and equipment ( 102 ) 46 Total operating expense 8,890 9,669 Income from Operations 254 1,093 Other (Expense) / Income Interest expense ( 45 ) ( 77 ) Other (expense) / income, net ( 181 ) 500 Government grant 145 113 Total other (expense) / income ( 81 ) 536 Income from Continuing Operations before Income Taxes 173 1,629 Income Tax Expense ( 168 ) ( 486 ) Income from Continuing Operations before Non-controlling Interest, Net of Tax 5 1,143 Discontinued Operations Loss from discontinued operations, net of tax ( 5 ) ( 1 ) NET INCOME - 1,142 Less: Net income attributable to non-controlling interest 41 92 Net (Loss) / Income Attributable to Trio-Tech International Common Shareholders $ ( 41 ) $ 1,050 Amounts Attributable to Trio-Tech International Common Shareholders: (Loss) / income from continuing operations, net of tax ( 36 ) 1,051 Loss from discontinued operations, net of tax ( 5 ) ( 1 ) Net (Loss) / Income Attributable to Trio-Tech International Common Shareholders $ ( 41 ) $ 1,050 Basic (Loss) / Earnings per Share: Basic (loss) / earnings per share from continuing operations attributable to Trio-Tech International $ ( 0.01 ) $ 0.25 Basic earnings per share from discontinued operations attributable to Trio-Tech International $ - $ - Basic (Loss) / Earnings per Share from Net (Loss) / Income Attributable to Trio-Tech International $ ( 0.01 ) $ 0.25 Diluted (Loss) / Earnings per Share: Diluted (loss) / earnings per share from continuing operations attributable to Trio-Tech International $ ( 0.01 ) $ 0.24 Diluted earnings per share from discontinued operations attributable to Trio-Tech International $ - $ - Diluted (Loss) / Earnings per Share from Net (Loss) / Income Attributable to Trio-Tech International $ ( 0.01 ) $ 0.24 Weighted average number of common shares outstanding Basic 4,271 4,160 Dilutive effect of stock options 93 139 Number of shares used to compute earnings per share diluted 4,364 4,299 See notes to consolidated financial statements. F-4 Table of Contents TRIO-TECH INTERNATIONAL AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (IN THOUSANDS) For the Year Ended June 30, 2025 2024 Comprehensive Income Attributable to Trio-Tech International Common Shareholders: Net income $ - $ 1,142 Foreign currency translation, net of tax 1,800 ( 106 ) Comprehensive Income 1,800 1,036 Less: Comprehensive (loss) / income attributable to non-controlling interest ( 21 ) 84 Comprehensive Income Attributable to Trio-Tech International Common Shareholders $ 1,821 $ 952 See notes to consolidated financial statements. F-5 Table of Contents TRIO-TECH INTERNATIONAL AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (IN THOUSANDS) Accumulated Accumulated Other Non- Common Stock Paid-in Retained Comprehensive controlling Shares Amount Capital Earnings Income Interest Total $ $ $ $ $ $ Balance at June 30, 2023 4,097 12,819 5,066 10,763 758 165 29,571 Stock option expense - - 465 - - - 465 Net income - - - 1,050 - 92 1,142 Exercise of stock option 153 506 - - - - 506 Translation adjustment - - - - ( 98 ) ( 8 ) ( 106 ) Balance at June 30, 2024 4,250 13,325 5,531 11,813 660 249 31,578 Stock option expense - - 448 - - - 448 Net (loss) / income - - - ( 41 ) - 41 - Acquisition of subsidiary without a change in control - - - 265 - ( 265 ) - Exercise of stock option 63 165 - - - - 165 Translation adjustment - - - - 1,862 ( 62 ) 1,800 Balance at June 30, 2025 4,313 13,490 5,979 12,037 2,522 ( 37 ) 33,991 See accompanying notes to consolidated financial statements. F-6 Table of Contents TRIO-TECH INTERNATIONAL AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS) For the Year Ended June 30, 2025 2024 Cash Flow from Operating Activities Net income $ - $ 1,142 Adjustments to reconcile net income to net cash flow provided by operating activities Unrealized foreign exchange loss 450 159 Depreciation and amortization 2,741 4,234 (Gain) / Loss on sale and write-off of property, plant and equipment ( 102 ) 46 Stock compensation 448 465 Addition of provision for obsolete inventory, net 150 44 Payment of interest portion of finance lease ( 3 ) ( 6 ) Bad debt recovery, net of allowance charged 1 ( 5 ) Accrued interest income, net accrued interest expense ( 30 ) ( 72 ) Addition of income tax provision ( 12 ) ( 7 ) Assurance warranty utilisation, net 4 - Deferred tax expenses / (benefit) 48 ( 22 ) Repayment of operating lease ( 1,450 ) ( 1,415 ) Changes in operating assets and liabilities, net of acquisition effects Trade accounts receivable ( 142 ) ( 838 ) Other receivables ( 67 ) 398 Other assets ( 11 ) ( 51 ) Inventories 898 ( 1,046 ) Prepaid expenses and other current assets 150 159 Accounts payable and accrued expenses ( 1,881 ) 798 Contract liabilities ( 505 ) ( 523 ) Income taxes payable ( 320 ) ( 176 ) Other non-current liabilities 4 ( 567 ) Net Cash Provided by Operating Activities $ 371 $ 2,717 Cash Flow from Investing Activities Withdrawal from unrestricted term deposits 5,799 4,796 Investment in unrestricted term deposits ( 4,838 ) ( 4,627 ) Proceeds from disposal of assets for sale - 200 Proceeds from disposal of property, plant and equipment 173 60 Additions to property, plant and equipment ( 967 ) ( 542 ) Net Cash Provided by / (Used in) Investing Activities $ 167 ( 113 ) Cash Flow from Financing Activities Payment on lines of credit ( 98 ) ( 961 ) Payment of bank loans ( 279 ) ( 475 ) Payment of principal portion of finance leases ( 59 ) ( 112 ) Proceeds from exercising stock options 165 506 Proceeds from lines of credit 231 952 Net Cash Used in Financing Activities $ ( 40 ) ( 90 ) Effect of Changes in Exchange Rate 587 4 Net Increase in Cash, Cash Equivalents, and Restricted Cash 1,085 2,518 Cash, Cash Equivalents, and Restricted Cash at Beginning of Period 12,556 10,038 Cash, Cash Equivalents, and Restricted Cash at End of Period $ 13,641 $ 12,556 Supplementary Information of Cash Flows Cash paid during the period for: Interest $ 46 $ 75 Income taxes $ 438 $ 425 Reconciliation of Cash, Cash Equivalents, and Restricted Cash Cash 10,890 10,035 Restricted Term-Deposits in Current Assets 816 750 Restricted Term-Deposits in Non-Current Assets 1,935 1,771 Total Cash, Cash Equivalents, and Restricted Cash Shown in Statements of Cash Flows $ 13,641 $ 12,556 Restricted deposits represent the amount of cash pledged to secure loans payable or trade financing granted by financial institutions, serve as collateral for public utility agreements such as electricity and water, and performance bonds related to customs duty payable. Restricted deposits are classified as current and non-current depending on whether they relate to long-term or short-term obligations. Restricted deposits of $816 as of June 30, 2025 are classified as current assets as they relate to short-term trade financing. Restricted deposits of $1,935 as of June 30, 2025 are classified as non-current assets as they relate to long-term obligations and will become unrestricted only upon discharge of the obligations. F-7 Table of Contents TRIO-TECH INTERNATIONAL AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED June 30, 2025 and 2024 (IN THOUSANDS, EXCEPT EARNINGS PER SHARE) 1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation - Trio-Tech International (the “ Company ” or “ TTI ”) was incorporated in fiscal year ended June 30, 1958 under the laws of the State of California. TTI provides third -party semiconductor testing and burn-in services primarily through its laboratories in Southeast Asia. The Company also designs, develops, manufactures and markets a broad range of equipment and systems used in the manufacturing and testing of semiconductor devices and electronic components. During the year ended June 30, 2025 , TTI conducted business in two business segments: Semiconductor Back-End Solutions and Industrial Electronics. TTI has subsidiaries in the U.S., Singapore, Malaysia, Thailand, Indonesia, and China as follows: Ownership Location Express Test Corporation (Dormant) 100 % Van Nuys, California Trio-Tech Reliability Services (Dormant) 100 % Van Nuys, California KTS Incorporated, dba Universal Systems (Dormant) 100 % Van Nuys, California European Electronic Test Centre (Dormant) 100 % Cayman Islands Trio-Tech International Pte. Ltd. 100 % Singapore Universal (Far East) Pte. Ltd.* 100 % Singapore Trio-Tech International (Thailand) Co. Ltd. * 100 % Bangkok, Thailand Trio-Tech (Bangkok) Co. Ltd. * 100 % Bangkok, Thailand Trio-Tech (Malaysia) Sdn. Bhd. 55 % Penang and Selangor, Malaysia (55% owned by Trio-Tech International Pte. Ltd.) Prestal Enterprise Sdn. Bhd. 76 % Selangor, Malaysia (76% owned by Trio-Tech International Pte. Ltd.) Trio-Tech (SIP) Co., Ltd. * 100 % Suzhou, China Trio-Tech (Chongqing) Co. Ltd. * 100 % Chongqing, China SHI International Pte. Ltd. (Dormant) 55 % Singapore (55% owned by Trio-Tech International Pte. Ltd) PT SHI Indonesia (Dormant) 52 % Batam, Indonesia (95% owned by SHI International Pte. Ltd.) Trio-Tech (Tianjin) Co., Ltd. * 100 % Tianjin, China Trio-Tech (Jiangsu) Co., Ltd. (100% owned by Trio-Tech (SIP) Co., Ltd.) 100 % Suzhou, China * 100 % owned by Trio-Tech International Pte. Ltd. # Trio-Tech (Kuala Lumpur) Sdn. Bhd. has been gazetted and formally removed from the register following the completion of the strike-off process during the year ended June 30, 2025 . On June 30, 2025, TTI, through its subsidiary Trio-Tech (SIP) Co., Ltd., a Suzhou, China limited liability company (“ Trio-Tech SIP ”) acquired 49 % of the equity interest of Trio-Tech (Jiangsu) Co. Ltd., a Suzhou, China limited liability company (“ Trio-Tech Jiangsu ”) from Suzhou Anchuang Technology Management LLP (“ Anchuang ”), resulting in the acquisition of all the equity interest in Trio-Tech Jiangsu (the “ Equity Acquisition ”). Prior to the Equity Acquisition, Trio-Tech SIP owned 51 % of the equity interest of Trio-Tech Jiangsu. As result of the Equity Acquisition, Trio-Tech Jiangsu became a wholly-owned subsidiary of Trio-Tech SIP. Trio-Tech SIP is a wholly-owned subsidiary of Trio-Tech International Pte Ltd, a Singapore limited liability company, which is a wholly-owned subsidiary of Trio-Tech International. The consolidated financial statements are prepared in accordance with United States Generally Accepted Accounting Principles (“ U.S. GAAP ’’). The basis of accounting differs from that used in the statutory financial statements of the Company’s subsidiaries and equity investee companies, which are prepared in accordance with the accounting principles generally accepted in their respective countries of incorporation. In the opinion of management, the consolidated financial statements have reflected all costs incurred by the Company and its subsidiaries in operating the business. F- 8 Table of Contents All dollar amounts in the consolidated financial statements and in the notes herein are presented in thousands of United States dollars ( US’000 ) unless otherwise designated. Liquidity – The Company made a net loss attributable to common shareholders of $ 41 during the year ended June 30, 2025 (“ Fiscal 2025 ”) and net income attributable to common shareholders of $ 1,050 during the year ended June 30, 2024 (“ Fiscal 2024 ”), respectively. The Company’s core businesses, Semiconductor Back-end Solutions (“ SBS ”) and Industrial Electronics(“ IE ”), operate in a volatile industry, where average selling prices and product costs are influenced by competitive factors. These factors create pressures on sales, costs, earnings and cash flows, which can impact liquidity. Foreign Currency Translation and Transactions – The U.S. dollar is the functional currency of the U.S. parent company. The Singapore dollar (“ SGD ”), the national currency of Singapore, is the primary currency of the economic environment in which the operations in Singapore are conducted. The Company also has business entities in Malaysia, Thailand, China and Indonesia of which the Malaysian ringgit (“ RM ”), Thai baht, Chinese renminbi (“ RMB ”) and Indonesian rupiah, are the national currencies. The Company uses the U.S. dollar for financial reporting purposes. The Company translates assets and liabilities of its subsidiaries outside the U.S. into U.S. dollars using the rate of exchange prevailing at the fiscal year end, and the consolidated statements of operations and comprehensive income or loss is translated at average rates during the reporting period. Adjustments resulting from the translation of the subsidiaries’ financial statements from foreign currencies into U.S. dollars are recorded in shareholders' equity as part of accumulated other comprehensive gain - translation adjustments. Gains or losses resulting from transactions denominated in currencies other than functional currencies of the Company’s subsidiaries are reflected in income for the reporting period. Use of Estimates – The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expense during the reporting period. Among the more significant estimates included in these consolidated financial statements are the estimated allowance for credit losses on account receivables, reserve for obsolete inventory, impairments, provision of income tax, stock options and the deferred income tax asset allowance. Actual results could materially differ from those estimates. Revenue Recognition – The Company follows ASU No. 2014 - 09, ASC Topic 606, Revenue from Contracts with Customers (“ ASC Topic 606 ”). This standard update outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. We apply a five -step approach as defined in ASC Topic 606 in determining the amount and timing of revenue to be recognized: ( 1 ) identifying the contract with customer; ( 2 ) identifying the performance obligations in the contracts; ( 3 ) determining the transaction price; ( 4 ) allocating the transaction price to the performance obligations in the contract; and ( 5 ) recognizing revenue when the corresponding performance obligation is satisfied. Revenue derived from testing services in SBS and IE segment is recognized when services are rendered. Revenue generated from sale of products for both SBS and IE segments are recognized when persuasive evidence of an arrangement exists, delivery of the products has occurred, customer acceptance has been obtained (which means the control has been transferred to the customer), the price is fixed or determinable and collectability is reasonably assured. Certain customers can request for installation and training services to be performed for certain equipment sold in SBS and IE segment. These services are mainly for helping customers with the test runs of the machines sold and are considered a separate performance obligation. Such services can be provided by other entities as well, and these do not significantly modify the product. The Company recognizes the revenue at the point in time when the Company has satisfied its performance obligations. The Company enters into repair and maintenance service contracts for a fee over a specified duration. These contracts typically involve the provision of ongoing services, such as routine maintenance, repairs, and support. Revenue from these contracts is recognized over time, as the customer simultaneously receives and consumes the benefits of the services as they are provided. The continuous nature of these services means that the customer benefits from the Company's performance throughout the contract period. Accordingly, the Company uses a time-based measure of progress to recognize revenue evenly over the duration of the contract, reflecting the ongoing transfer of control of the services to the customer. This method accurately reflects the pattern of service delivery and the customer's receipt of benefits from the Company's performance. F- 9 Table of Contents Certain customers can request for installation and training services to be performed for certain products sold. These services are mainly for helping customers with the test runs of the machines sold and are considered a separate performance obligation. Such services can be provided by other entities as well and these do not significantly modify the product. The Company recognizes the revenue at a point in time when the Company has satisfied its performance obligation. GST / Indirect Taxes – The Company’s policy is to present taxes collected from customers and remitted to governmental authorities on a net basis. The Company records the amounts collected as a current liability and relieves such liability upon remittance to the taxing authority without impacting revenue or expense. Trade Account Receivables and Allowance for Credit Losses – During the normal course of business, the Company extends unsecured credit to its customers in all segments. Typically, credit terms require payment to be made between 30 to 90 days from the date of the sale. The Company generally does not require collateral from our customers. The Company accounts for allowance for credit losses under the current expected credit loss (“CECL”) impairment model for its financial assets, including accounts receivable, and presents the net amount of the financial instrument expected to be collected. The CECL impairment model requires an estimate of expected credit losses, measured over the contractual life of an instrument, which considers forecasts of future economic conditions in addition to information about past events and current conditions. Based on this model, the Company estimates the amount of uncollectible accounts receivable at the end of each reporting period based on the aging of the receivable balance, current and historical customer trends, communications with its customers, and macro-economic conditions. Amounts are written off after considerable collection efforts have been made and the amounts are determined to be uncollectible. Assurance Warranty Costs – The Company provides for the estimated costs that may be incurred under its warranty program at the time the sale is recorded in its products sales. The Company estimates warranty costs based on the historical rates of warranty returns. The Company periodically assesses the adequacy of its recorded warranty liability and adjusts the amounts as necessary. Cash and Cash Equivalents – The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Term Deposits – Term deposits consist of bank balances and interest-bearing deposits with maturities more than three months. Restricted Term Deposits – The Company held certain term deposits in Singapore and Malaysia operations which were considered restricted, as they were held as security against certain facilities granted by the financial institutions. Inventories – Inventories in the Company’s business , consisting principally of raw materials, works in progress, and finished goods, are stated at the lower of cost and net realizable value, using the first -in, first -out (“ FIFO ”) method. The semiconductor industry is characterized by rapid technological change, short-term customer commitments and rapid fluctuations in demand. Provisions for estimated excess and obsolete inventory are based on our regular reviews of inventory quantities on hand and the latest forecasts of product demand and production requirements from our customers. Inventories are written down for not -saleable, excess or obsolete raw materials, works-in-process and finished goods by charging such write-downs to cost of sales. In addition to write-downs based on newly introduced parts, statistics and judgments are used for assessing provisions of the remaining inventory based on salability and obsolescence. Property, Plant and Equipment and Investment Properties – Property, plant and equipment and investment properties are stated at cost, less accumulated depreciation and amortization. Depreciation is provided for over the estimated useful lives of the assets using the straight-line method. Amortization of leasehold improvements is provided for over the lease terms or the estimated useful lives of the assets, whichever is shorter, using the straight-line method. Maintenance, repairs and minor renewals are charged directly to expense as incurred. Additions and improvements to the assets are capitalized. When assets are disposed of, the related cost and accumulated depreciation thereon are removed from the accounts and any resulting gain or loss is included in the consolidated statements of operations and comprehensive income or loss. F- 10 Table of Contents Long-Lived Assets and Impairment – The Company’s business requires heavy investment in manufacturing facilities and equipment that are technologically advanced but can quickly become significantly underutilized or rendered obsolete by rapid changes in demand. The Company evaluates the long-lived assets, including property, plant and equipment and investment property, for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Factors considered important that could result in an impairment review include significant underperformance relative to expected historical or projected future operating results, significant changes in the manner of use of the assets or the strategy for our business, significant negative industry or economic trends, and a significant decline in the stock price for a sustained period of time. Impairment is recognized based on the difference between the fair value of the asset and its carrying value, and fair value is generally measured based on undiscounted cash flow analysis, if there is significant adverse change. The Company applies the provisions of ASC Topic 360, Accounting for the Impairment or Disposal of Long-Lived Assets (“ ASC Topic 360 ”), to property, plant and equipment. ASC Topic 360 requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through the estimated undiscounted cash flows expected to result from the use and eventual disposition of the assets. Whenever any such impairment exists, an impairment loss will be recognized for the amount by which the carrying value exceeds the fair value. Leases – The Company applies the guidance in ASC Topic 842, Lease Accounting (“ ASC Topic 842 ”) to its individual leases of assets. When the Company receives substantially all the economic benefits from and directs the use of specified property, plant and equipment, the transactions give rise to leases. The Company’s classes of assets include real estate leases. The Company determines if an arrangement is a lease, or contains a lease, at the inception of the arrangement and evaluate whether the lease is an operating lease or a finance lease at the commencement date. When discount rates implicit in leases cannot be readily determined, the Company uses the applicable incremental borrowing rate at lease commencement to perform lease classification tests on lease components and to measure lease liabilities and ROU assets. The incremental borrowing rate used by the Company was based on baseline rates and adjusted by the credit spreads commensurate with the Company’s secured borrowing rate over a similar term. At each reporting period when there is a new lease initiated, the rates established for that quarter will be used. All of the leases under which the Company is the lessor will continue to be classified as operating leases and sales-type lease. Comprehensive Income or Loss – ASC Topic 220, Reporting Comprehensive Income, (“ ASC Topic 220 ”), establishes standards for reporting and presentation of comprehensive income or loss and its components in a full set of general-purpose consolidated financial statements. The Company has chosen to report comprehensive income or loss in the statements of operations. Comprehensive income or loss is comprised of net income or loss and all changes to shareholders’ equity except those due to investments by owners and distributions to owners. Income Taxes – The Company accounts for income taxes using the liability method in accordance with ASC Topic 740, Accounting for Income Taxes (“ ASC Topic 740 ”) . ASC Topic 740 requires an entity to recognize deferred tax liabilities and assets. Deferred tax assets and liabilities are recognized for the future tax consequence attributable to the difference between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements, which will result in taxable or deductible amounts in future years. Further, the effects of enacted tax laws or rate changes are included as part of deferred tax expense or benefits in the period that covers the enactment date. The calculation of tax liabilities involves dealing with uncertainties in the application of complex global tax regulations. The Company recognizes potential liabilities for anticipated tax audit issues in the U.S. and other tax jurisdictions based on its estimate of whether, and the extent to which, additional taxes will be due. If payment of these amounts ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when the Company determines the liabilities are no longer necessary. If the estimate of tax liabilities proves to be less than the ultimate assessment, a further charge to expense would result. Retained Earnings – It is the intention of the Company to re-invest earnings of its foreign subsidiaries in the operations of those subsidiaries. These taxes are undeterminable as of the date of this Annual Report. The amount of earnings retained in subsidiaries was $ 23,374 and $ 22,528 as of June 30, 2025 and 2024 , respectively. F- 11 Table of Contents Research and Development Costs – The Company incurred research and development costs of $ 384 and $ 392 during Fiscal 2025 and 2024 , respectively, which were charged to operating expense as incurred. Stock-based Compensation – The Company calculates compensation expense related to stock option awards made to employees and directors based on the fair value of stock-based awards on the date of grant. The Company determines the grant date fair value of our stock option awards using the Black-Scholes option pricing model and for awards without performance condition the related stock-based compensation is recognized over the period in which a participant is required to provide service in exchange for the stock-based award, which is generally four years. The Company recognizes stock-based compensation expense in the consolidated statements of shareholders' equity based on awards ultimately expected to vest. Forfeitures are estimated on the date of grant and revised if actual or expected forfeiture activity differs materially from original estimates. Determining the fair value of stock-based awards at the grant date requires significant judgment. The determination of the grant date fair value of stock-based awards using the Black-Scholes option-pricing model is affected by our estimated common stock fair value as well as other subjective assumptions including the expected term of the awards, the expected volatility over the expected term of the awards, expected dividend yield and risk-free interest rates. The assumptions used in our option-pricing model represent management’s best estimates and are as follows: ● Fair Value of Common Stock . We determined the fair value of each share of underlying common stock based on the mean of the high and the low prices of Shares sold on an established securities market on the date the option is granted. ● Expected Term . The expected term of employee stock options reflects the period for which we believe the option will remain outstanding based on historical experience and future expectations. ● Expected Volatility . We base expected volatility on our historical information over a similar expected term. Earnings per Share – Computation of basic earnings per share is conducted by dividing net income available to common shares (numerator) by the weighted average number of common shares outstanding (denominator) during a reporting period. Computation of diluted earnings per share gives effect to all dilutive potential common shares outstanding during a reporting period. In computing diluted earnings per share, the average market price of common shares for a reporting period is used in determining the number of shares assumed to be purchased from the exercise of stock options. Fair Values of Financial Instruments – Carrying values of trade account receivables, accounts payable, accrued expense, and term deposits approximate their fair value due to their short-term maturities. Carrying values of the Company’s lines of credit and long-term debt are considered to approximate their fair value because the interest rates associated with the lines of credit and long-term debt are adjustable in accordance with market situations when the Company tries to borrow funds with similar terms and remaining maturities. See Note 15 for detailed discussion of the fair value measurement of financial instruments. ASC Topic 820, Fair Value Measurements and Disclosures (“ ASC Topic 820 ”) defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The financial assets and financial liabilities that require recognition under the guidance include available-for-sale investments, employee deferred compensation plan and foreign currency derivatives. The guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of us. Unobservable inputs are inputs that reflect our assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available under the circumstances. As such, fair value is a market-based measure considered from the perspective of a market participant who holds the asset or owes the liability rather than an entity-specific measure. The hierarchy is broken down into three levels based on the reliability of inputs as follows: ● Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that we can access. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment. Financial assets utilizing Level 1 inputs include U.S. treasuries, most money market funds, marketable equity securities and our employee deferred compensation plan; ● Level 2 – Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, directly or indirectly. Financial assets and liabilities utilizing Level 2 inputs include foreign currency forward exchange contracts, most commercial paper and corporate notes and bonds; and ● Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement. F- 12 Table of Contents Concentration of Credit Risk – Financial instruments that subject the Company to credit risk consist of trade account receivables. The Company performs ongoing credit evaluations of its customers for potential credit losses. The Company generally does not require collateral. The Company believes that its credit policies do not result in significant adverse risk and historically it has not experienced significant credit related losses. Investments – The Company (a) evaluates the sufficiency of the total equity at risk, (b) reviews the voting rights and decision-making authority of the equity investment holders as a group, and whether there are any guaranteed returns, protection against losses, or capping of residual returns within the group, and (c) establishes whether activities within the venture are on behalf of an investor with disproportionately few voting rights in making this VIE determination. The Company would consolidate an investment that is determined to be a VIE if it was the primary beneficiary. The primary beneficiary of a VIE is determined by a primarily qualitative approach, whereby the variable interest holder, if any, has the power to direct the VIE’s most significant activities and is the primary beneficiary. A standard became effective and changed the method by which the primary beneficiary of a VIE is determined. Through a primarily qualitative approach, the variable interest holder who has the power to direct the VIE’s most significant activities is determined to be the primary beneficiary. To the extent that the investment does not qualify as VIE, the Company further assesses the existence of a controlling financial interest under a voting interest model to determine whether the investment should be consolidated. Loan Receivables from Property Development Projects – The loan receivables from property development projects are classified as current assets, carried at face value, and are individually evaluated for impairment. The allowance for loan losses reflects management’s best estimate of probable losses determined principally on the basis of historical experience and specific allowances for known loan accounts. All loans or portions thereof deemed to be uncollectible or to require an excessive collection cost are written off to the allowance for losses. Interest income on the loan receivables from property development projects are recognized on an accrual basis. Discounts and premiums on loans are amortized to income using the interest method over the remaining period to contractual maturity. The amortization of discounts into income is discontinued on loans that are contractually 90 days past due or when collection of interest appears doubtful. Contingent Liabilities – Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company’s management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Recasting of Certain Prior Period Information - In response to changes in our business strategy, during the first quarter of fiscal 2025, the Company’s chief operating decision maker, who is also our Chief Executive Officer, requested changes in the information that he regularly reviews for purposes of allocating resources and assessing performance. As a result, beginning in fiscal 2025, we report our financial performance based on our new segments described in Note 14 – Segment Information. We have recast certain prior period amounts to conform to the way we internally manage and monitor segment performance during fiscal 2025. This change primarily impacted Note 14 – Segment Information, with no impact on consolidated net income or cash flows. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed. 2. NEW ACCOUNTING PRONOUNCEMENTS In November 2023, the Financial Accounting Standards Board (" FASB ") issued Accounting Standards Update (" ASU ") 2023 - 07, Segment Reporting (Topic 280 ), Improvements to Reportable Segment Disclosures. The new guidance requires enhanced disclosures about significant segment expense. This standard update is effective for Company beginning in the fiscal year ending June 30, 2025 and interim period reports beginning in the first quarter of the fiscal year ending June 30, 2026. The Company has adopted this ASU for the fiscal year ending June 30, 2025. F- 13 Table of Contents In December 2023, the FASB issued ASU 2023 - 09, Income Taxes (Topic 740 ), Improvements to Income Tax Disclosures . The new guidance requires enhanced disclosures about income tax expense. This standard update is effective for Company beginning in the fiscal year ending June 30, 2026. Early adoption is permitted on a prospective basis. The Company do not plan to early adopt and is currently evaluating the impact of this ASU on annual income tax disclosures. In November 2024, the FASB released ASU No. 2024 - 03, Disaggregation of Income Statement Expenses . This ASU’s purpose is to improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses in commonly presented expense captions. Early adoption is permitted. The Company do not plan to early adopt and is currently evaluating the impact of this ASU. This standard update is effective for Company beginning in the fiscal year ending June 30, 2029. Other new pronouncements issued but not yet effective until after June 30, 2025 are not expected to have a significant effect on the Company’s consolidated financial position or results of operations. 3. TERM DEPOSITS For the Year Ended June 30, 2025 2024 Short-term deposits $ 5,571 $ 6,540 Currency translation effect on short-term deposits 246 ( 43 ) Total short-term deposits 5,817 6,497 Restricted term deposits - Current 768 750 Currency translation effect on restricted term deposits 48 - Total restricted term deposits - Current 816 750 Restricted term deposits - Non-current 1,797 1,773 Currency translation effect on restricted term deposits 138 ( 2 ) Total restricted term deposits - Non-current 1,935 1,771 Total term deposits $ 8,568 $ 9,018 Restricted deposits represent the amount of cash pledged to secure loans payable or trade financing granted by financial institutions, serve as collateral for public utility agreements such as electricity and water, and performance bonds related to customs duty payable. Restricted deposits are classified as current and non-current depending on whether they relate to long-term or short-term obligations. Restricted deposits of $ 816 as of June 30, 2025 are classified as current assets as they relate to short-term trade financing. Restricted deposits of $ 1,935 as of June 30, 2025 are classified as non-current assets as they relate to long-term obligations and will become unrestricted only upon discharge of the obligations. Short-term deposits represent bank deposits, which do not qualify as cash equivalents. 4. TRADE ACCOUNT RECEIVABLES AND ALLOWANCE FOR CREDIT LOSSES Accounts receivable are customer obligations due under normal trade terms. The Company performs continuing credit evaluations of its customers’ financial conditions, and although management generally does not require collateral, letters of credit may be required from the customers in certain circumstances. The allowance for credit losses represent management’s expected credit losses in our trade receivables as of the date of the financial statements. The allowance provides for probable losses that have been identified with specific customer relationships and for probable losses believed to be inherent in the trade receivables, but that have not been specifically identified. Based on the information available to us, management believed the allowance for credit losses as of June 30, 2025 and June 30, 2024 was adequate. F- 14 Table of Contents The following table represents the changes in the allowance for credit losses: For the Year Ended June 30, 2025 2024 Beginning $ 209 $ 217 Additions charged to expenses 62 12 Recovered ( 61 ) ( 15 ) Written off ( 178 ) ( 2 ) Currency translation effect 3 ( 3 ) Ending $ 35 $ 209 5. LOANS RECEIVABLE FROM PROPERTY DEVELOPMENT PROJECTS The following table presents Trio-Tech (Chongqing) Co. Ltd (“ TTCQ ”)’s loan receivables from property development projects in China as of June 30, 2025 . Loan Expiry Loan Amount Loan Amount Date (RMB) (U.S. Dollars) Short-term loan receivables JiangHuai (Project – Yu Jin Jiang An) May 31, 2013 2,000 279 Less: allowance for expected credit losses ( 2,000 ) ( 279 ) Net loan receivables from property development projects - - The short-term loan receivables amounting to RMB 2,000, or approximately $ 279 arose due to TTCQ entering into a Memorandum Agreement with JiangHuai Property Development Co. Ltd. (“ JiangHuai ”) to invest in their property development projects (Project - Yu Jin Jiang An) located in Chongqing City, China in the fiscal year ended June 30, 2011 (“ Fiscal 2011 ”). Based on TTI’s financial policy, an allowance for expected credit losses of $ 279 on the investment in JiangHuai was recorded during the fiscal year ended June 30, 2014 (“ Fiscal 2014 ”). TTCQ did not generate other income from JiangHuai for Fiscal 20 25. TTCQ is in the legal process of recovering the outstanding amount of approximately $ 279 . 6. INVENTORIES Inventories consisted of the following: For the Year Ended June 30, 2025 2024 Raw materials $ 1,438 $ 1,668 Work in progress 658 1,048 Finished goods 838 1,129 Less: provision for obsolete inventories ( 851 ) ( 679 ) Currency translation effect 179 ( 4 ) $ 2,262 $ 3,162 F- 15 Table of Contents The following table represents the changes in provision for obsolete inventories: For the Year Ended June 30, 2025 2024 Beginning $ 679 $ 648 Additions charged to expenses 160 65 Usage – disposition ( 10 ) ( 21 ) Currency translation effect 22 ( 13 ) Ending $ 851 $ 679 7 . INVESTMENT PROPERTIES The following table presents the Company’s investment in properties in China as of June 30, 2025 and June 30, 2024. The exchange rate is based on the market rate as of June 30, 2025 and June 30, 2024. For the Year Ended June 30, 2025 2024 Property I – MaoYe Property Cost $ 301 $ 301 Less: Accumulated depreciation ( 250 ) ( 226 ) Currency translation effect ( 11 ) ( 22 ) $ 40 53 For the Year Ended June 30, 2025 2024 Property II – JiangHuai Property Cost $ - $ 580 Less: Accumulated depreciation - ( 360 ) Currency translation effect - ( 83 ) Carrying value of relinquished asset $ - $ 137 Cost of acquired asset 137 - Less: Accumulated depreciation of acquired asset ( 25 ) - Currency translation effect 1 $ 113 $ 137 For the Year Ended June 30, 2025 2024 Property III – FuLi Property Cost $ 648 $ 648 Less: Accumulated depreciation ( 382 ) ( 338 ) Currency translation effect ( 74 ) ( 93 ) $ 192 $ 217 F- 16 Table of Contents Rental Property I - MaoYe A lease agreement was entered into on February 1, 2023 for a period of 4 years at a monthly rate of RMB15, or approximately $ 2 . Pursuant to the agreement, monthly rental will increase by 5% after the second year. MaoYe property generated a rental income of $ 25 for both Fiscal 2025 and 2024 , respectively. Depreciation expense for MaoYe was $ 14 for both Fiscal 2025 and 2024 , respectively. Rental Property II - JiangHuai During the year ended June 30, 2010 (“ Fiscal 2010 ”), TTCQ purchased eight units of commercial property in Chongqing, China, from JiangHuai for RMB 3,600 , or approximately $ 580 . The title deeds for these properties had not been received by TTCQ since the entire project had not been completed by JiangHuai. JiangHuai is currently in liquidation and the local court had appointed a Management Company to manage the liquidation process and address claims from stakeholders. To expedite the resolution, TTCQ agreed to settle the claims through an asset exchange. The court directed the Management Company to engage a third -party valuer to assess the assets involved. Based on the valuation, the court determined that TTCQ would receive title deeds for 5 shop units having a total area of 547.67 m² in exchange of the claim made for the 8 units without title deeds. In July 2024, the court concluded that the value of these 5 shop units was equivalent to the original purchase price of 8 shop units of RMB 3,600 and issued a court order to process title deeds for the five units in the name of TTCQ. The carrying value of the JiangHuai asset group as at June 30, 2024 was RMB 990 . Applying the guidance in FASB Accounting Standards Codification (" ASC ") Topic 845, Nonmonetary transactions, this transaction lacks commercial substance and hence, the JiangHuai asset group continued to be accounted based on the carrying value of the exchanged investment properties. The title deeds have been received as of September 2024. JiangHuai properties generated a rental income of $ 2 and $nil for Fiscal 2025 and 2024 , respectively. Depreciation expense for JiangHuai was $ 25 for both Fiscal 2025 and 2024 , respectively. F- 17 Table of Contents Rental Property III – FuLi FuLi properties generated a rental inco me of $ 9 and $ 1 for Fiscal 2025 and 2024 , respectively. A lease agreement was entered into October 10, 2024 for a period of four years at a monthly rate of RMB9, or approximately $ 1 . Pursuant to the agreement, monthly rental will increase by 5% after the second year. Depreciation expense for FuLi was $ 28 for both Fiscal 2025 and 2024 , respectively. Summary Total rental income for all investment properties in China was $ 36 and $ 26 for Fiscal 2025 and 2024 , respectively. Depreciation expense for all investment properties in China was $ 67 for both Fiscal 2025 and 2024 , respectively. 8. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following: Estimated Useful For the Year Ended June 30, Life in Years 2025 2024 Building and improvements 3 - 20 $ 5,260 $ 5,185 Leasehold improvements 1 - 27 7,446 9,629 Machinery and equipment 3 - 7 22,189 25,090 Furniture and fixtures 3 - 5 1,205 1,252 Equipment under finance leases 3 - 5 1,481 1,545 Property, plant and equipment, gross $ 37,581 $ 42,701 Less: accumulated depreciation ( 28,100 ) ( 32,561 ) Less: accumulated amortization of equipment under finance leases ( 1,383 ) ( 1,341 ) Total accumulated depreciation $ ( 29,483 ) $ ( 33,902 ) Property, plant and equipment before currency translation effect, net $ 8,098 $ 8,799 Currency translation effect ( 2,077 ) ( 2,862 ) Property, plant and equipment, net $ 6,021 $ 5,937 Depreciation and amortization expense for property, plant and equipment during Fiscal 2025 and 2024 wa s $ 1,285 and $ 2,898 , respectively. Addition is inclusive of additions made from finance lease amount. F- 18 Table of Contents 9. OTHER ASSETS Other assets consisted of the following: For the Year Ended June 30, 2025 2024 Deposits for rental and utilities and others 219 234 Downpayment for Purchase of Investment Properties* 1,580 1,580 Less: Provision for impairment ( 1,580 ) ( 1,580 ) Currency translation effect 12 ( 2 ) Total $ 231 $ 232 *Down payment for purchase of investment properties included downpayment relating to shop lots in Singapore Themed Resort Project in Chongqing, China. The shop lots are to be delivered to TTCQ upon completion of the construction. The initial targeted date of completion was in Fiscal 2017. However, progress has stalled because the developer is currently reorganizing assets and renegotiating with the creditors to complete the project. During the fourth quarter of Fiscal 2021, the Company accrued an impairment charge of $ 1,580 related to the doubtful recovery of the down payment on property in the Singapore Themed Resort Project in Chongqing, China. The Company elected to take this non-cash impairment charge due to increased uncertainties regarding the project’s viability, given the developers’ weakening financial condition as well as uncertainties arising from the negative real-estate environment in China, implementation of control measures on real-estate lending in China and its relevant government policies. F- 19 Table of Contents 10. LINES OF CREDIT The carrying value of the Company’s lines of credit approximates its fair value because the interest rates associated with the lines of credit are adjustable in accordance with market situations when the Company borrowed funds with similar terms and remaining maturities. The Company’s credit rating provides it with readily and adequate access to funds in global markets. As of June 30, 2025 , the Company had certain lines of credit that are collateralized by restricted deposits. Entity with Type of Interest Credit Unused Facility Facility Rate Limitation Credit Trio-Tech International Pte. Ltd., Lines of Credit Cost of Funds Rate +1.25% $ 4,155 $ 3,856 Singapore Universal (Far East) Pte. Ltd. Lines of Credit Cost of Funds Rate +1.25% $ 1,960 $ 1,864 Trio-Tech Malaysia Sdn. Bhd. Revolving credit Cost of Funds Rate +2% $ 354 $ 354 As of June 30, 2024 , the Company had certain lines of credit that are collateralized by restricted deposits. Entity with Type of Interest Credit Unused Facility Facility Rate Limitation Credit Trio-Tech International Pte. Ltd., Lines of Credit Cost of Funds Rate +1.25% $ 3,907 $ 3,626 Singapore Universal (Far East) Pte. Ltd. Lines of Credit Cost of Funds Rate +1.25% $ 1,843 $ 1,818 Trio-Tech Malaysia Sdn. Bhd. Revolving credit Cost of Funds Rate +2% $ 318 $ 318 11. ACCRUED EXPENSE Accrued expense consisted of the following: June 30, June 30, 2025 2024 Payroll and related costs $ 1,040 $ 1,859 Commissions 155 164 Travel expenses 24 25 Legal and audit 302 328 Sales tax 61 34 Sales rebate 46 - Utilities 95 231 Warranty 17 27 Accrued purchase 339 553 Provision for reinstatement 555 384 Other accrued expense 125 7 Acquisition of subsidiary shares from non-controlling interest 141 - Currency translation effect 136 22 Total $ 3,036 $ 3,634 F- 20 Table of Contents 12. ASSURANCE WARRANTY ACCRUAL The Company provides for the estimated costs that may be incurred under its warranty program at the time the sale is recorded. The warranty period of the products manufactured by the Company is generally one year or the warranty period agreed upon with the customer. The Company estimates the warranty costs based on the historical rates of warranty returns. The Company periodically assesses the adequacy of its recorded warranty liability and adjusts the amounts as necessary. For the Year Ended June 30, 2025 2024 Beginning $ 27 $ 24 Additions charged to cost and expense 4 21 Utilization ( 15 ) ( 20 ) Currency translation effect 1 2 Ending $ 17 $ 27 13. BANK LOANS PAYABLE June 30, June 30, 2025 2024 Note payable denominated in the Malaysian Ringgit for expansion plans in Malaysia, maturing in July 2028, bearing interest at the bank’s prime rate less 2.00 % ( 4.85 % for both June 30, 2025 and 2024) per annum, with monthly payments of principal plus interest through July 2028, collateralized by the acquired building with a carrying value of $ 2,351 and $ 2,149 , as of June 30, 2025 and 2024 respectively. $ 508 $ 596 Financing arrangement at fixed interest rate 3.2 % per annum, with monthly payments of principal plus interest through July 2025. 4 44 Financing arrangement at fixed interest rate 3.0 % per annum, with monthly payments of principal plus interest through December 2026. 85 124 Financing arrangement at fixed interest rate 3.0 % per annum, with monthly payments of principal plus interest through August 2027. 87 110 Total bank loans payable $ 684 $ 874 Current portion of bank loans payable 225 235 Currency translation effect on current portion of bank loans 31 26 Current portion of bank loans payable 256 261 Long-term portion of bank loans payable 368 591 Currency translation effect on long-term portion of bank loans 60 22 Long-term portion of bank loans payable $ 428 $ 613 F- 21 Table of Contents Future minimum payments (excluding interest) as of June 30, 2025 , were as follows: 2026 $ 256 2027 236 2028 181 2029 11 Total obligations and commitments $ 684 Future minimum payments (excluding interest) as of June 30, 2024 , were as follows: 2025 $ 260 2026 230 2027 212 2028 172 Total obligations and commitments $ 874 14. COMMITMENTS AND CONTINGENCIES The Company has capital commitments for capital expenditure amounting t o $ 16 as at June 30, 2025 , as compared to capital commitment of $ 65 as at June 30, 2024 . Deposits with banks are not fully insured by the local government or agency and are consequently exposed to risk of loss. The Company believes that the probability of bank failure, causing loss to the Company, is remote. The Company is, from time to time, the subject of litigation claims and assessments arising out of matters occurring in its normal business operations. In the opinion of management, resolution of these matters will not have a material adverse effect on the Company’s consolidated financial statements. 15. FAIR VALUE OF FINANCIAL INSTRUMENTS In accordance with ASC Topic 825 and 820, the following presents assets and liabilities measured and carried at fair value and classified by level of fair value measurement hierarchy: There were no transfers between Levels 1 and 2 during the year ended June 30, 2025 , or for the same period in the prior year. Term deposits (Level 2 ) – The carrying amount approximates fair value because of the short maturity of these instruments. Restricted term deposits (Level 2 ) – The carrying amount approximates fair value because of the short maturity of these instruments. Lines of credit (Level 3 ) – The carrying value of the lines of credit approximates fair value due to the short-term nature of the obligations. Bank loans payable (Level 3 ) – The carrying value of the Company’s bank loans payable approximates its fair value as the interest rates associated with long-term debt is adjustable in accordance with market situations when the Company borrowed funds with similar terms and remaining maturities. F- 22 Table of Contents 16. CONCENTRATION OF CUSTOMERS During the years ended June 30, 2025 and 2024 , the Company had three major customers that accounted for the following revenue and trade account receivables: For the Year Ended June 30, 2025 2024 Revenue - Customer A 20.7 % 20.6 % - Customer B 16.8 % 16.0 % - Customer C 9.5 % 12.9 % As of June 30, 2025 2024 Trade Account Receivables - Customer A 22.0 % 20.8 % - Customer B 22.4 % 18.7 % - Customer C 11.9 % 17.5 % 17. BUSINESS SEGMENTS ASC Topic 280, Segment Reporting , establishes standards for reporting information about operating segments. Operating segments are defined as components of a reporting entity, the operating results of which are reviewed regularly by the chief operating decision maker (“ CODM ”) to make decisions about resource allocation and to assess performance. Our CODM is our Chief Executive Officer. In response to changes in our business strategy in an effort to better align with our focus areas and to streamline operations, during the first quarter of Fiscal 2025, our CODM requested changes in the information that he regularly reviews for purposes of allocating resources and assessing performance. As a result, we have updated our reporting and beginning in Fiscal 2025, we report our financial performance based on our new segments, SBS and IE, and analyze gross profit and operating income as the measure of segment profitability. We have recast certain prior period amounts to conform to the way we internally manage and monitor segment performance during Fiscal 2025. Our operating businesses are organized based on the nature of markets. The SBS segment comprises our core semiconductor back-end equipment manufacturing and testing operations that serve the semiconductor industry. Our value-added distribution business, along with our services and equipment manufacturing operations that serve various industries are being reported together in our IE segment. A detailed description of our operating segments and a mapping of our previous presentation and the new segments in the year ended June 30, 2025 can be found in the overall business strategies and business segments section of Item 1 of this Report, entitled "Business". Our CODM uses total revenue, gross profit, operating income and total assets in assessing segment performance and deciding how to allocate resources. Segment operating income includes corporate allocations. Segment revenues include sales of equipment and services by our segments. Total intersegment sales were $ 216 in the year ended June 30, 2025 and $ 769 in the year ended June 30, 2024 . Certain corporate costs, including those related to legal, information technology, human resources and shared services are allocated to our segments on a combination of factors based on their relative revenues, manpower costs and fixed assets investments. The amounts related to revenue and earnings presented as "Corporate/Others & Unallocated" include the results of an immaterial real estate business that ceased to be a reportable segment in Fiscal 2025 and includes certain costs incurred at the corporate-level, including the cost of our stock compensation plans, salaries, insurance, professional expenses and directors' fees not allocated to our reportable segments. Assets presented under the Corporate/Others & Unallocated segment consisted primarily of cash and cash equivalents, prepaid expenses and investment properties. F- 23 Table of Contents The cost of equipment, current year investment in new equipment and depreciation expense is allocated into respective reportable segments based on the primary purpose for which the equipment was acquired. The following segment information table includes segment operating income or loss after including corporate expenses allocated to the segments, which gets eliminated in the consolidation: Gross Operating Year Ended Profit / Income / Total Depr. And Capital Jun. 30, Revenue (Loss) (Loss) Assets Amort. Expenditures Semiconductor Back-End Solutions 2025 $ 24,682 $ 6,766 $ 411 $ 23,114 $ 2,437 $ 867 2024 $ 30,111 $ 8,376 $ 1,095 $ 23,418 $ 4,056 $ 542 Industrial Electronics 2025 11,756 $ 2,412 $ 236 $ 6,659 $ 236 $ 100 2024 12,176 $ 2,432 $ 509 $ 6,439 $ 210 $ - Corporate/Others & Unallocated 2025 35 $ ( 34 ) $ ( 393 ) $ 11,295 $ 68 $ - 2024 25 $ ( 46 ) $ ( 511 ) $ 12,683 $ 75 $ - Total Company 2025 $ 36,473 $ 9,144 $ 254 $ 41,068 $ 2,741 $ 967 2024 $ 42,312 $ 10,762 $ 1,093 $ 42,540 $ 4,341 $ 542 Management periodically evaluates the ongoing contributions of each of its business segments to its current and future revenue and prospects. As a result, it may divest one or more business segments in the future to enable management to concentrate on segments where it anticipates opportunities for future revenue growth, thereby maximizing shareholder value. 18. OTHER (EXPENSE) / INCOME Other (expense) / income consisted of the following: For the Year Ended June 30, 2025 2024 Interest income $ 314 $ 370 Other rental income 138 127 Exchange loss ( 671 ) ( 74 ) Other miscellaneous income 38 77 Total $ ( 181 ) $ 500 F- 24 Table of Contents 19. GOVERNMENT GRANTS For the Year Ended June 30, 2025 2024 Government grants $ 145 $ 113 During Fiscal 2025 , the Company received government grants amounting to $ 145 , $ 82 of which was an incentive from the Singapore government for local resident recruitment, $ 48 from the U.S. government related to Employee Retention Credit (“ ERC ”) and the remaining $ 15 related to capital expenditure subsidy received from the government in China. During Fiscal 2024 , the Company received government grants amounting to $ 113 , $ 23 of which was an incentive from the Singapore government for local resident recruitment, $ 33 related to capital expenditure subsidy received from the China government and $ 57 from the U.S. government related to Employee Retention Credit. 20. INCOME TAXES (Loss) / Income before provision for income taxes consists of the following: For the Year Ended June 30, 2025 2024 United States ( 642 ) ( 539 ) International 815 2,168 Total $ 173 $ 1,629 The components of the provision for income taxes are as follows: For the Year Ended June 30, 2025 2024 Current: Federal $ ( 25 ) $ 76 State 5 2 Foreign 141 442 $ 121 $ 520 Deferred: Foreign 47 ( 34 ) Total $ 168 $ 486 A reconciliation of income tax benefit compared to the amount of income tax expense that would result by applying the U.S. federal statutory income tax rate to pre-tax income is as follows: For the Year Ended June 30, 2025 2024 Statutory federal tax rate 21.00 % 21.00 % State taxes, net of federal benefit 0.11 0.75 Permanent items and credits 126.63 11.04 Foreign rate differential ( 52.40 ) ( 4.23 ) Tax true-ups and adjustments 14.27 - Other 12.28 0.34 Changes in valuation allowance 14.70 0.93 Effective rate 136.59 % 29.83 % F- 25 Table of Contents The provision for income taxes has been determined based upon the tax laws and rates in the countries in which we operate. The Company is subject to income taxes in the U.S. and numerous foreign jurisdictions. Significant judgment is required in determining the provision for income taxes and income tax assets and liabilities, including evaluating uncertainties in the application of accounting principles and complex tax laws. Due to the enactment of Tax Cuts and Jobs Act, the Company is subject to a tax on global intangible low-taxed income ( “ GILTI ” ) . GILTI is a tax on foreign income in excess of a deemed return on tangible assets of foreign corporations. Companies subject to GILTI have the option to account for the GILTI tax as a period cost if and when incurred, or to recognize deferred taxes for temporary differences including outside basis differences expected to reverse as GILTI. The Company has elected to account for GILTI as a period cost, and therefore has included GILTI expense in its effective tax rate calculation for the year ended June 30, 2025 . The Company accrues penalties and interest related to unrecognized tax benefits when necessary as a component of penalties and interest expenses, respective ly. The Company had no unrecognized tax benefits or related accrued penalties or interest expenses at June 30, 2025 . In assessing the ability to realize the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the genera tion of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on these criteria, management believes it is more likely than not the Company will not realize the benefits of the federal, state, and foreign deductible differences. Accordingly, a valuation allowance has been established against deferred tax assets recorded in the US and various foreign jurisdictions. Temporary differences that give rise to a significant portion of deferred tax assets and deferred tax liabilities are as follows: For the Year Ended June 30, 2025 2024 Deferred tax assets: Net operating losses and credits $ 646 $ 599 Inventory valuation 75 75 Right-of-use assets - 56 Accrued vacation 33 12 Accrued expense 42 142 Fixed asset basis 25 11 Investment 70 77 General business credit 39 14 Other - 13 Total deferred tax assets $ 930 $ 999 Deferred tax liabilities: Depreciation $ ( 196 ) $ ( 238 ) Right-of-use assets ( 10 ) ( 56 ) Other ( 1 ) ( 1 ) Total deferred tax liabilities $ ( 207 ) $ ( 295 ) Subtotal 723 704 Valuation allowance ( 642 ) ( 580 ) Net deferred tax assets $ 81 $ 124 Presented as follows in the balance sheets: Deferred tax assets $ 91 $ 124 Deferred tax liabilities ( 10 ) - Net deferred tax assets $ 81 $ 124 F- 26 Table of Contents The valuation allowance increased by $ 61 in Fiscal 2025 and decreased by $ 37 in Fiscal 2024 . At June 30, 2025 , the Company had no federal net operating loss carry-forward and had state net operating loss carry-forward of $ 2,384 , which expire through 2034. These carryovers may be subject to limitations under I.R.C. Section 382. In assessing the ability to realize the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax asset s is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on these criteria, management believes it is more likely than not the Company will not realize the benefits of the federal, state, and foreign deductible differences. Accordingly, a valuation allowance has been established against deferred tax assets recorded in the US and various foreign jurisdictions. Generally, U.S. federal, state, and foreign authorities may examine the Company’s tax returns for three years, four years, and five years, respectively, from the date an income tax return is filed. However, the taxing authorities may continue to adjust the Company’s net operating loss carry-forwards until the statute of limitations closes on the tax years in which the net operating losses are utilized. Foreign tax authorities are currently conducting audits of our subsidiaries in Malaysia and China. 21. REVENUE The Company generates revenue primarily from SBS and IE, it's two reporting segments. The Company accounts for a contract with a customer when there is approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. The Company’s revenues are measured based on consideration stipulated in the arrangement with each customer, net of any sales incentives and amounts collected on behalf of third parties, such as sales taxes. The revenues are recognized as separate performance obligations that are satisfied by transferring control of the product or service to the customer. Significant Judgments The Company’s arrangements with its customers include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. A product or service is considered distinct if it is separately identifiable from other deliverables in the arrangement and if a customer can benefit from it on its own or with other resources that are readily available to the customer. The Company allocates the transaction price to each performance obligation on a relative standalone selling price basis (“ SSP ”). Determining the SSP for each distinct performance obligation and allocation of consideration from an arrangement to the individual performance obligations and the appropriate timing of revenue recognition are significant judgments with respect to these arrangements. The Company typically establishes the SSP based on observable prices of products or services sold separately in comparable circumstances to similar clients. The Company may estimate SSP by considering internal costs, profit objectives and pricing practices in certain circumstances. Warranties, discounts and allowances are estimated using historical and recent data trends. The Company includes estimates in the transaction price only to the extent that a significant reversal of revenue is not probable in subsequent periods. The Company’s products and services are generally not sold with a right of return, nor has the Company experienced significant returns from or refunds to its customers. F- 27 Table of Contents Products The Company primarily derives revenue from the sale of both front-end and back-end semiconductor test equipment and related peripherals, maintenance, and support of all these products, installation and training services and the sale of spare parts. The Company’s revenues are measured based on consideration stipulated in the arrangement with each customer, net of any sales incentives and amounts collected on behalf of third parties, such as sales taxes. The Company derives SBS segment revenue from the sale of burn-in and reliability test equipment used in the “back-end” manufacturing processes of semiconductors. Our equipment includes burn-in systems, burn-in boards and related equipment that is used in the testing of structural integrity of integrated circuits. Under the IE segment, the Company designs, manufactures and distributes an extensive range of test, process and other equipment used in the manufacturing processes of customers in various industries in the consumer and industrial market. The Company also acts as a design-in reseller of a wide range of camera module, LCD displays and touch screen panels. The Company recognizes revenue at a point in time when the Company has satisfied its performance obligation by transferring control of the product to the customer. The Company uses judgment to evaluate whether the control has transferred by considering several indicators, including whether: ● the Company has a present right to payment; ● the customer has legal title; ● the customer has physical possession; ● the customer has significant risk and rewards of ownership; and ● the customer has accepted the product, or whether customer acceptance is considered a formality based on history of acceptance of similar products (for example, when the customer has previously accepted the same equipment, with the same specifications, and when we can objectively demonstrate that the tool meets all the required acceptance criteria, and when the installation of the system is deemed perfunctory). Not all indicators need to be met for the Company to conclude that control has transferred to the customer. In circumstances in which revenue is recognized prior to the product acceptance, the portion of revenue associated with its performance obligations of product installation and training services are deferred and recognized upon acceptance. Majority of the equipment sales type include a 12 -month warranty. The Company generally provides a limited warranty that our products comply with applicable specifications at the time of delivery. Under our standard terms and conditions of sale, liability for certain failures of product during a stated warranty period is usually limited to repair or replacement of defective parts. The Company has concluded that the warranty provided for standard products are assurance type warranties and are not separate performance obligations. Customized products are generally more complex and, as a result, may contain unforeseen faults that could lead to additional costs for us, including increased servicing or the need to provide product modifications. Warranty provided for customized products are service warranties and are separate performance obligations. Transaction prices are allocated to this performance obligation using cost plus method. The portion of revenue associated with warranty service is deferred and recognized as revenue over the warranty period, as the customer simultaneously receives and consumes the benefits of warranty services provided by the Company. Product sales were $ 21,459 for the fiscal year ended June 30, 2025, as compared to $ 24,070 for the fiscal year ended June 30, 2024. Services The Company renders testing services to manufacturers and purchasers of semiconductors and other entities who either lack testing capabilities or whose in-house screening facilities are insufficient. The Company primarily derives testing revenue from burn-in services, manpower supply and other associated services. SSP is directly observable from the sales orders. Revenue is allocated to performance obligations satisfied at a point in time depending upon terms of the sales order. Generally, there is no other performance obligation other than what has been stated inside the sales order for each of these sales. Terms of contract that may indicate potential variable consideration include warranty, late delivery penalty and reimbursement to solve non-conformance issues for rejected products. Based on historical and recent data trends, it is concluded that these terms of the contract do not represent potential variable consideration. The transaction price is not contingent on the occurrence of any future event. Service sales were $ 14,980 for the fiscal year ended June 30, 2025, as compared to $ 18,217 for the fiscal year ended June 30, 2024. F- 28 Table of Contents Contract Balances The timing of revenue recognition, billings and collections may result in billed accounts receivable, unbilled receivables, contract assets, customer advances, deposits and contract liabilities. The Company’s payment terms and conditions vary by contract type, although terms generally include a requirement of payment of 70% to 90% of total contract consideration within 30 to 60 days of shipment with the remainder payable within 30 days of acceptance. In instances where the timing of revenue recognition differs from the timing of invoicing, the Company has determined that its contracts generally do not include a significant financing component. The following table is the reconciliation of contract balances. June 30, June 30, 2025 2024 Trade Accounts Receivable 10,804 10,661 Accounts Payable 1,896 3,175 Contract Liabilities 250 754 The Company had $nil and $ 47 remaining performance obligations, which represents our obligation to deliver products and services as of June 30, 2025 and 2024. Practical Expedients The Company applies the following practical expedients: ● The Company accounts for shipping and handling costs as activities to fulfil the promise to transfer the goods, instead of a promised service to its customer. ● The Company has not elected to adjust the promised amount of consideration for the effects of a significant financing component as the Company expects, at contract inception, that the period between when the entity transfers a promised good or service to a customer and when the customer pays for that good or service will generally be one year or less. ● The Company has elected to adopt the practical expedient for contract costs, specifically in relation to incremental costs of obtaining a contract. Costs to obtain a contract are not material, and the Company generally expenses such costs as incurred because the amortization period is one year or less. F- 29 Table of Contents 22. EARNINGS PER SHARE The Company follows ASC Topic 260, Earnings Per Share. Basic earnings per share (“ EPS ”) are computed by dividing net income available to common shareholders (numerator) by the weighted average number of common shares outstanding (denominator) during the period. Diluted EPS give effect to all dilutive potential common shares outstanding during a period. In computing diluted EPS, the average price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options and warrants. Options to purchase 819,250 shares of common stock at exercise prices ranging from $ 3.73 to $ 7.76 per share were outstanding as of June 30, 2025 . 82,467 s tock options were excluded in the computation of diluted EPS for Fiscal 2025 because they were anti-dilutive. Options to purchase 701,750 shares of common stock at exercise prices ranging from $ 2.53 to $ 7.76 per share were outstanding as of June 30, 2024 . 140,500 stock options were excluded in the computation of diluted EPS for Fiscal 2024 because they were anti-dilutive. The following table is a reconciliation of the weighted average shares used in the computation of basic and diluted EPS for the years presented herein: For the Year Ended June 30, 2025 2024 (Loss) / Income attributable to Trio-Tech International common shareholders from continuing operations, net of tax $ ( 36 ) $ 1,051 Loss attributable to Trio-Tech International common shareholders from discontinued operations, net of tax ( 5 ) ( 1 ) Net (loss) / income attributable to Trio-Tech International Common Shareholders $ ( 41 ) $ 1,050 Weighted average number of common shares outstanding - basic 4,271 4,160 Dilutive effect of stock options 93 139 Number of shares used to compute earnings per share - diluted 4,364 4,299 Basic (loss) / earnings per share from continuing operations attributable to Trio-Tech International $ ( 0.01 ) $ 0.25 Basic earnings per share from discontinued operations attributable to Trio-Tech International - - Basic (loss) / earnings per share from net income attributable to Trio-Tech International $ ( 0.01 ) $ 0.25 Diluted (loss) / earnings per share from continuing operations attributable to Trio-Tech International $ ( 0.01 ) $ 0.24 Diluted earnings per share from discontinued operations attributable to Trio-Tech International - - Diluted (loss) / earnings per share from net income attributable to Trio-Tech International (1*) $ ( 0.01 ) $ 0.24 ( 1*) For periods in which the Company has reported net loss, diluted net loss per share attributable to common stockholders is the same as basic net loss per share attributable to common stockholders, because dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. F- 30 Table of Contents 23. STOCK OPTIONS On September 14, 2017, the Company’s Board of Directors unanimously adopted the 2017 Employee Stock Option Plan (the “ 2017 Employee Plan ”) and the 2017 Directors Equity Incentive Plan (the “ 2017 Directors Plan ”) each of which was approved by the shareholders on December 4, 2017. Assumptions The fair value for the stock options granted to both employees and directors was estimated using the Black-Scholes option pricing model with the following weighted average assumptions, assuming: ● An expected life varying from 2.50 to 3.25 years, calculated in accordance with the guidance provided in SEC Staff bulletin No. 110 for plain vanilla options using the simplified method, since the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term. ● A risk-free interest rate varying from 0.11 % to 4.59 % ( 2024 : 0.20 % to 4.59 %); ● No expected dividend payments and; ● Expected volatility of 46.0 % to 73.9 % ( 2024 : 47.3 % to 72.2 %). The expected volatilities are based on the historical volatility of the Company’s common stock. Due to higher volatility, the observation was made on a daily basis for the 12 months ended June 30, 2025 and 2024 respectively. The observation period covered is consistent with the expected life of the options. The expected life of the options granted to employees has been determined utilizing the “simplified” method as prescribed by ASC Topic 718 Stock Based Compensation , which, among other provisions, allows companies whose historical share option exercise experience does not provide a reasonable basis upon which to estimate expected term, to use a simplified approach for estimating the expected life of a “plain vanilla” option grant. The simplified rule for estimating the expected life of such an option is the average of the time to vesting and the full term of the option. The risk-free rate is consistent with the expected life of the stock options and is based on the United States Treasury yield curve in effect at the time of grant. 2017 Employee Stock Option Plan The Company’s 2017 Employee Plan permits the grant of stock options to its employees covering up to an aggregate of 300,000 shares of common stock. In December 2021, the Company’s Board of Directors approved an amendment to the 2017 Employee Plan to increase the shares covered thereby from 300,000 shares to an aggregate of 600,000 shares, which amendment was approved by the Company’s shareholders at the annual meeting held in December 2021. Under the 2017 Employee Plan, all options must be granted with an exercise price of no less than fair value as of the grant date and the options granted must be exercisable within a maximum of ten years after the date of grant, or such lesser period of time as is set forth in the stock option agreements. The options may be exercisable (a) immediately as of the effective date of the stock option agreement granting the option, or (b) in accordance with a schedule related to the date of the grant of the option, the date of first employment, or such other date as may be set by the Compensation Committee. Generally, options granted under the 2017 Employee Plan are exercisable within five years after the date of grant and vest over the period as follows: 25 % vesting on the grant date and the remaining balance vesting in equal installments on the next three succeeding anniversaries of the grant date. The share-based compensation will be recognized in terms of the grade method on a straight-line basis for each separately vesting portion of the award. Certain option awards provide for accelerated vesting if there is a change in control (as defined in the 2017 Employee Plan). During the year ended June 30, 2025 , the Company granted options to purchase 80,000 shares of its common stock to employees pursuant to the 2017 Employee Plan, with a weighted average grant-date fair value of $ 6.20 . During the year ended June 30, 2024 , the Company granted options to purchase 122,500 shares of its common stock to employees pursuant to the 2017 Employee Plan, with a weighted average grant-date fair value of $ 4.94 . There were 2,500 stock options exercised under the 2017 Employee Plan during the year ended June 30, 2025 . The Company recognized stock-based compensation expense of $ 244 in the year ended June 30, 2025 under the 2017 Employee Plan. The balance of unamortized stock-based compensation of $ 173 based on fair value on the grant date related to options granted under the 2017 Employee Plan is to be recognized over a period of 3 years. The weighted average remaining contractual term for non-vested options outstanding under the 2017 Employee Plan was 1.69 years. F- 31 Table of Contents There were 64,625 stock options exercised under the 2017 Employee Plan during the year ended June 30, 2024 . The Company recognized stock-based compensation expense of $ 246 in the year ended June 30, 2024 under the 2017 Employee Plan. The balance of unamortized stock-based compensation of $ 196 based on fair value on the grant date related to options granted under the 2017 Employee Plan is to be recognized over a period of 3 years. The weighted average remaining contractual term for non-vested options outstanding under the 2017 Employee Plan was 2.01 years. As of June 30, 2025 , there were vested employee stock options granted under the 2017 Employee Plan covering a total of 210,750 shares of common stock, with a weighted average exercise price of $ 5.59 , and a weighted average contractual term of 2.35 years. The total fair value of vested employee stock options outstanding under the 2017 Employee Plan as of June 30, 2025 , was $ 1,179 . As of June 30, 2024 , there were vested employee stock options granted under the 2017 Employee Plan covering a total of 136,250 shares of common stock, with a weighted average exercise price of $ 5.57 , and a weighted average contractual term of 2.87 years. The total fair value of vested employee stock options outstanding under the 2017 Employee Plan as of June 30, 2024 , was $ 759 . A summary of option activities under the 2017 Employee Plan during the years ended June 30, 2025 and 2024 , is presented as follows: Weighted Average Weighted Remaining Average Contractual Aggregate Exercise Term Intrinsic Options Price (Years) Value Outstanding at July 1, 2023 216,375 4.89 2.92 140 Granted 122,500 4.94 - - Exercised ( 64,625 ) 3.14 - - Forfeited or expired ( 3,500 ) - - - Outstanding at June 30, 2024 270,750 5.35 3.43 268 Granted 80,000 6.20 - - Exercised ( 2,500 ) 4.97 - - Forfeited or expired - - - - Outstanding at June 30, 2025 348,250 5.55 2.88 113 Exercisable at June 30, 2025 210,750 5.59 2.35 74 A summary of the status of the Company’s non-vested employee stock options during the years ended June 30, 2025 and 2024 , is presented below: Weighted Average Grant-Date Fair Options Value Non-vested at July 1, 2023 81,750 $ 5.53 Granted 122,500 6.26 Vested ( 69,750 ) - Forfeited - - Non-vested at June 30, 2024 134,500 $ 5.12 Granted 80,000 6.20 Vested ( 77,000 ) - Forfeited - - Non-vested at June 30, 2025 137,500 5.47 F- 32 Table of Contents 2017 Directors Equity Incentive Plan The 2017 Directors Plan permits the grant of options to its directors in the form of non-qualified options and restricted stock, and initially covered up to an aggregate of 300,000 shares of common stock. In September 2020, the Company’s Board of Directors approved an amendment to the 2017 Directors Plan to increase the shares covered thereby from 300,000 shares to an aggregate of 600,000 shares, which amendment was approved by the Company’s shareholders at the annual meeting held in December 2020. In October 2023, the Company’s Board of Directors approved an amendment to the 2017 Directors Plan to increase the shares covered thereby from 600,000 shares to an aggregate of 900,000 shares, which amendment was approved by the Company’s shareholders at the annual meeting held in December 2023. Under the 2017 Directors Plan, the exercise price of the non-qualified options is required to be 100% of the fair value of the underlying shares on the grant date. The options have five -year contractual terms and are exercisable immediately as of the grant date. During the year ended June 30, 2025 , the Company granted options to purchase 100,000 shares of its common stock to directors pursuant to the 2017 Directors Plan, with an exercise price equal to the fair market value of common stock (as defined under the 2017 Directors Plan in conformity with Regulation 409A or the Internal Revenue Code of 1986, as amended) at the date of grant, and a fair value of approximately $ 204 , based on the fair value of $ 2.04 per share determined by the Black-Scholes option pricing model. During the year ended June 30, 2024 , the Company granted options to purchase 100,000 shares of its common stock to directors pursuant to the 2017 Directors Plan, with an exercise price equal to the fair market value of common stock (as defined under the 2017 Directors Plan in conformity with Regulation 409A or the Internal Revenue Code of 1986, as amended) at the date of grant, and a fair value of approximately $ 220 , based on the fair value of $ 2.20 per share determined by the Black-Scholes option pricing model. As all stock options granted under the 2017 Directors Plan vest immediately on the date of grant, there were no unvested stock options granted under the 2017 Directors Plan as of June 30, 2025 and June 30, 2024 . There were 60,000 stock options exercised under the 2017 Directors Plan during the year ended June 30, 2025 . The Company recognized stock-based compensation expense of $ 204 in the year ended June 30, 2025 under the 2017 Directors Plan. There were 89,000 stock options exercised under the 2017 Directors Plan during the year ended June 30, 2024 . The Company recognized stock-based compensation expense of $ 220 in the year ended June 30, 2024 under the 2017 Directors Plan. A summary of option activities under the 2017 Directors Plan during the years ended June 30, 2025 and 2024 , is presented as follows: Weighted Average Weighted Remaining Average Contractual Aggregate Exercise Term Intrinsic Options Price (Years) Value Outstanding at July 1, 2023 420,000 $ 4.91 2.91 $ 309 Granted 100,000 5.01 - - Exercised ( 89,000 ) 3.40 - - Forfeited or expired - - - - Outstanding at June 30, 2024 431,000 $ 5.24 2.88 $ 531 Granted 100,000 5.01 - - Exercised ( 60,000 ) 2.53 - - Forfeited or expired - - - - Outstanding at June 30, 2025 471,000 $ 5.80 2.76 $ 136 Exercisable at June 30, 2025 471,000 $ 5.80 2.76 $ 136 F- 33 Table of Contents 24. LEASES Company as Lessor Operating leases under which the Company is the lessor arise from leasing the Company’s commercial real estate investment property to third parties. Initial lease terms generally range from 12 to 48 months. Depreciation expense for assets subject to operating leases is taken into account primarily on the straight-line method over a period of 20 years in amounts necessary to reduce the carrying amount of the asset to its estimated residual value. Depreciation expense relating to the property held as investments in operating leases w ere $ 67 an d $ 66 for the years ended June 30, 2025 and 2024 , respectively. Future minimum rental income in China and Thailand to be received from Fiscal 2026 to the fiscal year ended June 30, 2029 ( “Fiscal 2029” ) on non-cancellable operating leases, and is contractually due as of June 30, 2025 , as follows: 2026 $ 65 2027 23 2028 18 2029 4 $ 110 Future minimum rental income in China and Thailand to be received from fiscal year ended June 30, 2025 to fiscal year ended June 30, 2027 on non-cancellable operating leases, and is contractually due as of June 30, 2024 , as follows: 2025 $ 131 2026 44 2027 16 $ 191 F- 34 Table of Contents Company as Lessee The Company is the lessee under operating leases for corporate offices and research and development facilities with remaining lease terms of one year to four years and finance leases for plant and equipment. Supplemental balance sheet information related to leases was as follows (in thousands): Components of Lease Balances June 30, June 30, 2025 2024 Finance Leases (Plant and Equipment) Plant and equipment, at cost $ 400 $ 1,649 Accumulated depreciation ( 131 ) ( 1,091 ) Plant and Equipment, Net $ 269 $ 558 Current portion of finance leases $ 43 $ 57 Net of current portion of finance leases - 34 Total Finance Lease Liabilities $ 43 $ 91 Operating Leases (Corporate Offices, Research and Development Facilities) Operating lease right-of-use assets, Net $ 864 $ 1,887 Current portion of operating leases 540 1,162 Net of current portion of operating leases 324 725 Total Operating Lease Liabilities $ 864 $ 1,887 For the Year Ended June 30, 2025 2024 Lease Cost Finance lease cost: Interest on finance lease $ 3 $ 7 Amortization of right-of-use assets 78 85 Total finance lease cost 81 92 Operating Lease Costs $ 1,450 $ 1,548 Other information related to leases was as follows (in thousands except lease term and discount rate): For the Year Ended June 30, 2025 2024 Cash Paid for Amounts Included in the Measurement of Lease Liabilities Operating cash flows from finance leases $ ( 3 ) $ ( 6 ) Operating cash flows from operating leases ( 1,450 ) ( 1,415 ) Finance cash flows from finance leases ( 59 ) ( 112 ) Right-of-Use Assets Obtained in Exchange for New Operating Lease Liabilities 450 732 Weighted-Average Remaining Lease Term: Finance leases 0.65 1.46 Operating leases 2.25 1.58 Weighted-Average Discount Rate: Finance leases 1.98 % 2.47 % Operating leases 4.93 % 5.60 % F- 35 Table of Contents As of June 30, 2025 , the maturities of the Company's operating and finance lease liabilities were as follow: Operating Lease Finance Lease Liabilities Liabilities Fiscal Year 2026 560 44 2027 146 - 2028 217 - Total future minimum lease payments $ 923 $ 44 Less: amount representing interest ( 59 ) ( 1 ) Present value of net minimum lease payments $ 864 $ 43 Presentation on statement of financial position Current 540 43 Non-Current 324 - As of June 30, 2024 , future minimum lease payments under finance leases and noncancelable operating leases were as follows: Operating Lease Finance Lease Liabilities Liabilities Fiscal Year 2025 1,234 61 2026 658 34 2027 86 - Total future minimum lease payments $ 1,978 $ 95 Less: amount representing interest ( 91 ) ( 4 ) Present value of net minimum lease payments $ 1,887 $ 91 Presentation on statement of financial position Current 1,162 57 Non-Current 725 34 F- 36 Table of Contents 25. NON-CONTROLLING INTEREST In accordance with the provisions of ASC Topic 810, the Company has classified the non-controlling interest as a component of stockholders’ equity in the accompanying consolidated balance sheets. Additionally, the Company has presented the net income attributable to the Company and the non-controlling ownership interests separately in the accompanying consolidated financial statements. Non-controlling interest represents the minority stockholders’ share of 45 % of the equity of Trio-Tech (Malaysia) Sdn. Bhd., Trio-Tech (Kuala Lumpur) Sdn. Bhd., SHI International Pte. Ltd., 48 % of PT. SHI Indonesia, and 24 % interest in Prestal Enterprise Sdn. Bhd. which are subsidiaries of the Company. On June 30, 2025, TTI, through its subsidiary Trio-Tech (SIP) Co., Ltd., a Suzhou, China limited liability company (“ Trio-Tech SIP ”) acquired 49 % of the equity interest of Trio-Tech (Jiangsu) Co. Ltd., a Suzhou, China limited liability company (“ Trio-Tech Jiangsu ”) from Suzhou Anchuang Technology Management LLP (“ Anchuang ”), resulting in the acquisition of all the equity interest in Trio-Tech Jiangsu (the “ Equity Acquisition ”). Prior to the Equity Acquisition, Trio-Tech SIP owned 51% of the equity interest of Trio-Tech Jiangsu. As result of the Equity Acquisition, Trio-Tech Jiangsu became a wholly-owned subsidiary of Trio-Tech SIP. Trio-Tech SIP is a wholly-owned subsidiary of Trio-Tech International Pte Ltd, a Singapore limited liability company, which is a wholly-owned subsidiary of Trio-Tech International. The table below reflects a reconciliation of the equity attributable to non-controlling interest: For the Year Ended June 30, 2025 2024 Non-controlling interest Beginning balance $ 249 $ 165 Net income 41 92 Acquisition of subsidiary without a change in control ( 265 ) - Translation adjustment ( 62 ) ( 8 ) Ending balance $ ( 37 ) $ 249 26. STOCK REPURCHASE PROGRAM On May 8, 2025 , the Company’s Board of Directors authorized a share repurchase program under which the Company may repurchase up to $ 1 million of its issued and outstanding common stock over a period of two years. Any and all share repurchase transactions are subject to market condition and applicable legal requirements. As of June 30, 2025, $ 1 million remained available for repurchases under our repurchase program. 27. SUBSEQUENT EVENT On September 17, 2025, the Company and Lodestar Enterprise Sdn. Bhd. (“ Lodestar ”) entered into an Equity Purchase Agreement (“ Agreement ”) pursuant to which the Company, through its wholly-owned subsidiary, Trio-Tech International Pte. Ltd (Singapore) (“ Trio-Tech Singapore ”) agreed to acquire from Lodestar the remaining 50 % of the total share capital of Trio-Tech (Malaysia) Sdn. Bhd. owned by Lodestar and not already owned by Trio-Tech Singapore (the “ Acquisition ”). The Acquisition is subject to conditions to closing, including approval of the Acquisition by the Ministry of Investment, Trade and Industry in Malaysia. The purchase price for the Acquisition is RM14,200 payable in cash, or approximately $ 3,357 USD. Upon consummation of the Acquisition, the Company will indirectly through Trio-Tech Singapore own 100 % of the share capital of Trio-Tech Malaysia. Other than as set forth above, the Company evaluated subsequent events for their potential impact on the consolidated financial statements and disclosures through the date the consolidated financial statements were issued and determined that no additional subsequent events occurred that were reasonably expected to impact the consolidated financial statements presented herein. F-37