Siquan New Materials Postpones Two Fundraising Projects to October 2026, Overall Fundraising Capital Deployment Ratio Reaches 90.82%

Guangdong Siquan New Materials Co., Ltd. (hereinafter referred to as “Siquan New Materials”) recently received a special explanation from an accounting firm regarding the delay of its previous fundraising projects, “Construction of High-Performance Thermal Conductive Heat Dissipation Products (Phase I)” and “Construction of New Material R&D Center.” In response to the second round of inquiry letters from the Shenzhen Stock Exchange, Zhongtong Certified Public Accountants (Special General Partnership) confirmed that the delays until October 18, 2026, for the two projects are reasonable, and the use of raised funds is consistent with the revised plan, with no implementation obstacles.

According to the special explanation, as of September 30, 2025, the overall investment of the previous fundraising funds by Siquan New Materials has reached 90.82%. Specifically, 94.10% of the funds allocated to “Construction of High-Performance Thermal Conductive Heat Dissipation Products (Phase I),” 66.47% for “Construction of New Material R&D Center,” and 100% for “Supplementary Working Capital” have been used.

Reasons and Justification for Project Delays

The delay of “Construction of High-Performance Thermal Conductive Heat Dissipation Products (Phase I)” mainly results from the company’s need to dynamically adjust the remaining equipment introduction schedule based on downstream customer demand to avoid equipment idling. The main factory building has been completed and put into use, some production equipment has already started operation, and the simulated benefits from January to September 2025 are promising. It is expected to achieve the anticipated returns after completion.

The delay of the “Construction of New Material R&D Center” is due to rapid technological iteration in the market. The company needs to optimize its R&D direction and increase investment in fields such as composite heat dissipation technology and ultra-thin lightweight materials. Additionally, the production cycle of some self-developed and customized R&D equipment has uncertainties. To ensure project quality, the construction period has been extended. The delays for both projects do not change the main entities, locations, content, or investment structure.

Consistency of Fund Usage with the Original Plan

As of September 30, 2025, the actual use of the previous fundraising funds amounted to 429.5614 million yuan, with remaining funds of 43.4167 million yuan mainly for equipment payments and progress payments not yet due. The specific usage plan is as follows:

Among the remaining funds, approximately 200,000 yuan will be invested in the “High-Performance Thermal Conductive Heat Dissipation Products (Phase I)” project during October-December 2025, and about 15 million yuan in 2026. For the “Construction of New Material R&D Center,” about 5 million yuan will be invested in October-December 2025, and approximately 22.49 million yuan in two phases in 2026.

Factory Rental Status and Impact

As of September 30, 2025, Siquan New Materials has leased out some temporarily idle factory buildings related to the fundraising projects. The leased area to subsidiaries is 14,950.51 square meters (27.62%), and to external parties is 3,758.11 square meters (6.94%). The accounting firm believes that leasing out these spaces is aimed at improving asset utilization, and the relatively low area ratio will not affect the construction progress of the production lines. The company commits to prioritizing the needs of the fundraising project sites and, if necessary, reclaiming leased properties to ensure project implementation. There is no risk of project suspension due to site issues.

Regarding the market prospects for heat management materials, according to Market Research Future data, the global market size for consumer electronics heat management materials was USD 3.93 billion in 2024 and is expected to reach USD 9.582 billion by 2034, indicating a growth trend. Siquan New Materials states that the market environment for the previous fundraising projects has not undergone significant changes, and the projects remain reasonably feasible for continued implementation.

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