Greetings and welcome to Candy Technologies Group, Inc.'s first half 2026 Financial Results Conference call. At this time, all participants are on a listen-only mode. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Kewa Luo, Investor Relations. Thank you. Please go ahead. Thank you.

Hello, everyone, and welcome to Candy Technologies Group, Inc.'s first half 2026 Earnings Conference call. As a reminder, today's call is being recorded. The company's financial and operational highlights were issued in a press release earlier today and are available online. You can access the earnings press release and subscribe to the company's email alerts by visiting the investor relations section of our website at ir.candygroup.com. Joining us today are Mr. Feng Chen, Chief Executive Officer, and Mr. Alan Lin, Chief Financial Officer. Before we begin, please note that today's discussion will contain forward-looking statements made under the Safe Harbor provisions of the U.S. Private Security Litigation Reform Act of 1995. Forward-looking statements involve inherent risk and On Certainties. As such, the company's actual results may be materially different from the expectations expressed today. Further information regarding these and other risks and uncertainties is included in the company's public filings with the SEC. The company does not assume any obligations to update any forward-looking statements. except as required under applicable laws. Unless otherwise noted, all financial figures discussed today are in U.S. dollars. I will now turn the call over to our CEO, Mr. Feng Chen, who will deliver his remarks in Chinese, followed immediately by English translation. Mr. Chen, please go ahead.

Good day, investors and analysts. Welcome to Candy Technologies' earnings conference call for the first half of 2026. Thank you for your continued interest

and support of the company.

In the first half of 2026, after the early phase of the strategic transformation, the new business of Condi has entered the harvest period. The change of business has been reported and spread. It has shifted from the same road layout to commercialization. It is about to become an important growth curve for the company. At the same time, our main business growth is clearly improving. We continue to improve the marketing network of non-roadway car business, optimize the retail cooperation model, and promote product line to upgrade. These progress show that the company is continuing to transform strategic layout into business results, and business basics are constantly improving. This has further strengthened our confidence in the next stage of growth.

The first half of 2026 marked a new phase in Candy's strategic transformation as our new business initiatives began to deliver tangible results. Our battery swapping business, in particular, is gaining commercial traction, showing that our earlier investment and development efforts are paying off. It is now poised to become an important growth driver Growth Momentum is our core business, also strengthened significantly, driving robust things in both our top and bottom lines. Meanwhile, we continue to build out our off-road vehicle dealer network, refine our retail partnership model, and refresh and upgrade our product lineup. This financial and operational progress demonstrates Our strategy is driving improvements in operating performance and business fundamentals, reinforcing our confidence in our next phase of growth.

上半年,公司營收同比大幅增長57.4%, 達到5710萬美元。 核心非公路車電動車業務收入同比增長59.4%, to $54.2 million, of which the electric motorcycle brand Raw, which was acquired in February this year, contributed a revenue of $6.1 million. At the same time as revenue and net profit growth, the company's operating expenses remained relatively stable, promoting the performance of the business to achieve a loss-to-profit profit, and the profit performance significantly improved. The net profit increased by 452.2%, reaching $9.4 million. Our first half revenue grew 57.4% year-over-year to $57.1 million Revenue from our core off-road electric vehicle business increased 59.4%

to $54.2 million, including $6.1 million from Roar, the electric off-road motorcycle brand we acquired in February 2026. Higher revenue and gross profit combined with relatively stable operating expenses drove a return to operating profitability and a significant improvement in earnings. net income rose 452.2% year-over-year to $9.4 million. As of June 30, our cash and cash equivalents, restricted cash, and certificates of deposit totaled $285.7 million, providing a solid financial foundation to support future growth.

I have introduced the dual-engine strategy of Condi at the conference in 2025, which is to consolidate the basics of the North American non-roadway electric vehicle business and cultivate new growth sources in the field of energy and intelligent equipment. In this direction, we are continuously advancing the energy and electrical equipment and intelligent robot business, and through the strategic control of new energy sources, On our full-year 2025 earnings call, I outlined Candy's dual-engine strategy.

strengthening our core North American off-road electric vehicle businesses while cultivating new growth drivers in energy and intelligent equipment. On the new driver's side, we are advancing our battery swapping equipment and intelligent robotics business, and we broaden our energy solutions for AI data centers by acquiring a controlling stake and Xin Chu New Energy. Going forward, we will continue to improve product competitiveness and sales channel efficiency in our core business while tailoring our commercialization efforts for new business to each one stage of development. Over time, this will diversify our revenue base and growth drivers.

Next, I would like to share more details on our first half progress and recent developments across each business, as well as our priorities going forward. In terms of new business, the commercialization of energy and power equipment business has made a substantial progress. It is currently in the stage of scale production. In July this year, we launched a pre-priced pre-priced pre-priced pre-priced pre-priced pre-priced pre-priced pre-priced Let me begin with our new business initiative. We have made tangible progress in commercializing our battery swapping equipment and are now in volume production. In July,

Our subsidiary, China Battery Exchange, secured its first batch order from CATL's Shijian Energy subsidiary for heavy-duty truck battery swapping station equipment. Just two months later, it received another batch order. These orders demonstrate that our investments in technology and strategic partnerships are beginning to pay off. while also providing visibility for planning, production, and deliveries. We expect this business to begin generating meaningful revenue in the second half of this year, emerging as a new growth driver for Kandy.

For Kandy, the electronic equipment business is an important step in extending technology and manufacturing capabilities to the new energy infrastructure. In the next stage, we will focus on order delivery, improve product quality and delivery efficiency, and simultaneously improve customer service capabilities. Our goal is to use reliable project execution to consolidate customer cooperation, strive for subsequent orders, and at the same time stimulate delivery experience, improve scale production capabilities, and promote the continuous growth of electronic equipment business.

Our entry into the battery swapping equipment business marks an important step in extending Candi's technology and manufacturing expertise to new energy infrastructure. Looking ahead, our priorities are to fulfill customer orders, improve product quality and delivery efficiency, and strengthen our after-sales service capabilities. We aim to deepen customer relationships and secure follow-on orders by constantly meeting our project commitments. As we accumulate project delivery experience and scale manufacturing capacity, we will be better positioned to drive sustained growth in this business.

在智能机器人方向,我们保持持续的投入。 In intelligent robotics, we continue to invest in autonomous quadro robots, focusing on security patrols,

inspections, and applications in logistics parks. This business remains in an early R&D stage. Our work is currently centered on aligning development with customer needs, tailoring products to specific use cases, and validating their performance in real-world settings. Progress in these areas will guide our decisions on further investment.

At the same time, our strategic shareholder, Hsinchu, is actively expanding its AIDC backup power supply and storage capacity. In July, Hsinchu obtained the authorization from Hsinchu Electronics to solve the problem and entrust Hsinchu Electronics' matured UPS and data center infrastructure product system. and many other companies, we can provide customers with a tactical solution that covers spare power and storage applications. At present, relevant new products and technical services are continuously advancing to the market and have begun to receive overseas orders. It is expected that this year we can contribute a substantial income. As the AI algorithm technology facilities continue to develop, Additionally, Hsinchu New Energy, in which we acquired a controlling stake in the third quarter of this year, is expanding its AI data center backup power and energy storage business.

Xingzhu became an authorized solutions reseller of Schneider Electric. By combining Schneider Electric's established UPS and data center infrastructure products with Xingzhu's expertise in energy storage batteries and battery management systems, we can offer data center customers integrated backup power and energy storage solutions. Xingzhu is rolling out new products and Technical Services and has already begun winning orders overseas. We expect the business to make meaningful revenue contributions this year. As AI computing infrastructure continues to expand globally, we will build out our integrated solutions to meet demand for highly reliable backup power and energy storage, cultivate customer relationships and drive order conversion further developing this new revenue stream.

主營業務方面,仍然是以北美市場為核心的非公立電動車業務,涵蓋UTV,高爾夫球車和電動越野產品等。 上半年,美國業務的經銷商越均銷量較去年同期實現翻倍, Turning to our core business.

that is the North American off-road electric vehicle market with a portfolio spanning UTVs, golf carts, and other electric off-road products. In the first half, average monthly sales through our U.S. dealer network doubled year over year, reflecting strong sales momentum. This growth was driven by greater contributions from existing dealers and the addition of new partners. Looking ahead, we will deepen collaboration with existing dealers, add high quality new partners, and align these efforts with upcoming product launches to broaden our reach and improve sales performance.

产品方面,上半年我们继续清理滞销车型及全新车辆库存。 On the product side, we continue to clear inventory of slow-selling models

and old models in the first half. We expect to complete the transition to an all-new candy product lineup in the fourth quarter. We are closely coordinating inventory optimization, new product launches and sales channel upgrades to provide our dealers and retail partners with a more competitive product mix and help drive core business growth in 2027.

Roar is already contributing to our revenue.

and we continue to deepen its post-acquisition integration with the group. Amid intense price competition in the electric off-road motorcycle market, we are preserving Roar's premier brand positioning, focusing on product performance, rider experience, and brand equity to differentiate the business and support sustainable growth.

We will combine the development, manufacturing, and supply chain capabilities of the Group with Rawr's brand and channel resources to improve product development efficiency around the U.S. market demand and to further release Rawr's current sales potential of more than 300 cooperating e-commerce networks. In the first half of the year, Rawr will continue to enrich its team, improve its operating system, And through professional events, industry exhibitions, and social media to strengthen brand construction At the same time, we actively promote the whole series of new products to be developed The plan is to push towards the market in 2027 This year, we will focus on storage and delivery, new products preparation, and channel optimization As the integration of the system gradually presents itself, we are confident to turn the product and channel advantage into a greater income contribution

We are integrating Candy Group's R&D, manufacturing, and supply chain capabilities with RORs, brand assets, and distribution networks to develop products and respond to U.S. market demand more efficiently. We are also broadening RORs product offering and strengthening channel coordination to drive sales growth across its existing network of more than 300 dealer partners. In the first half, Roar continued to expand its team and refine its operating system while building brand equity through professional racing events, trade shows, and social media campaigns. Roar is also advancing development of an all-new product lineup with launches planned for 2027. This year, we are concentrating on managing the inventory transition, preparing for new launches, and optimizing our sales channels. As the benefits of integration materialize, we are confident we can convert these product and channel strengths into revenue increases and make a role A stronger growth driver for our North American business.

今年下半年,我们会重点推进四项工作。 第一,推进换电装备订单规模化交付,并推动幸存新能源拓展海外订单。 第二,延续北美非公路电动车业务的销售动能,推进渠道调整和抗击品牌产品性更新。 In short, we have four priorities for the second half of this year. First, scale battery swapping equipment deliveries and support Hsinchu New Energy in running additional overseas orders.

Second, sustain sales momentum in our North American off-road electric vehicle business while refining our sales channels and refreshing the candy product lineup. Third, strengthen Roth's team, supply chain, and distribution network in preparation for its new product launches in 2027. Fourth, continue developing intelligent robotic solutions tailored to real-world applications.

We are full of confidence in the growth prospects for 2027. As the combination of Condi brand products is upgraded, Raw new products are listed, and new businesses are gradually making income contributions, we expect that the company will receive more positive business growth. We remain confident about our outlook for 2027.

We expect a significant upgrade to Candy's product portfolio. New product launches and revenue contributions from our emerging businesses to drive stronger growth. At the same time, we will maintain a disciplined approach to capital allocation, evaluating investments in new businesses, acquisitions, and capacity expansion based on commercial progress, expected payback period and associated risks and returns, and aligning the pace of investment with business needs to optimize capital efficiency.

我和管理团队将全力推动各项经营计划的落地。

The management team and I are fully committed to strategic execution, converting the momentum in our core business and opportunities across our new business into sustainable growth and long-term value for our shareholders.

Now, let me turn the call over to our CFO, Alan Lin, who will provide details on our first half 2026 financial performance. Thank you. Thank you, Mr. Chen and Kewa.

and Alan Lin, CFO of Candy Technologies. And thanks everyone for joining us today. I will go over the financial results for the first half of 2026. Regarding the income statements, the net revenues were $57.1 million for the current period, up from 57.4% from $36.3 million for the same period in 2025. mainly due to an increase of sales of off-road vehicles compared to the prior year end period, as well as the additional revenue contributed by our new acquired entity, Roar, a subsidiary in the company acquired in February 2026. The cost of goods sold was 32.3 million in the current period, up 62.3% from 19.9 million for the same period of 2025. The increase was primarily due to the corresponding increase in sales. The gross profit was $28.8 million in the current period compared with $16.4 million for the same period of 2025. The gross margin was 43%. It was comparable to 45.2% for the same period of 2025. The total operating expenses were $19.3 million up 5.3% from $18.3 million for the same period of 2025. There's a breakdown of different expenses. The R&D expenses were $2.4 million, a decrease of 3.5% from $2.5 million for the same period of 2025. Regarding the selling expenses, the total amount was $5.8 million, up 10% from $4.5 million for the same period of 2025. The increase reflected the highest sales activities. The GNN expenses were $11.9 million, up 5.4% from $11.3 million for the same period of 2025. The income from operations was $5.5 million in the current period compared with the loss from operations of $1.9 million for the same period of 2025. The net income increased 452.2% to $9.4 million from $1.7 million for the same period of 2025. The increase was primarily driven by the high net revenues and gross profit, while the operating expenses remained relatively stable and controllable. The base and diluted net income attributed to the company's shareholders per share were $0.10, compared with $0.02 for the same period of 2005. Turning to our balance sheets, our financial position remained strong. As of June 30, 2026, the company had cash and cash equivalents, the return of cash, and certificates of deposit totaling $285.7 million, compared with $211.9 million as of December 30, 2025. The working capital was $189.5 million as of June 30, 2026. So that concludes my remarks. I will now hand the call back to Kewa for any final comments.

Thank you, everyone.

Thank you once again for joining us today. If you have any further questions, please reach out using the contact information provided on our website. We appreciate your time and interest in Candy Technologies. This concludes today's conference call. You may now disconnect.

Ladies and gentlemen, thank you for your participation. You may now disconnect your lines or log off the webcast and enjoy the rest of your day.