Business Operations - Graphjet Technology has not commenced commercial sales but plans to sample products to multinational companies to gain market acceptance [154]. - The company secured a production facility in July 2023, with machinery commissioning completed and production started, generating revenue from side products since June 2025 [155]. - The qualification process for products by prospective customers typically spans 12 to 18 months, involving comprehensive testing and quality assurance [169]. - The company is currently in the production testing phase at its factory located in Selangor State, Malaysia [211]. - The company aims to enhance its ESG profile by adopting green manufacturing methods, achieving up to an 83% reduction in carbon footprint and up to an 80% reduction in production costs [191]. - The company is positioned to become a global leader in high-quality graphene and graphite production, catering to multiple billion-dollar markets [192]. - The company's patented production technology allows it to offer graphene and graphite at lower production costs while maintaining higher quality standards [194]. Financial Performance - General and administrative expenses decreased by approximately $13.5 million, or 96.1%, from approximately $14.1 million for the three months ended March 31, 2024, to approximately $0.6 million for the three months ended March 31, 2025 [200]. - Net loss decreased by approximately $13.7 million, or 96.0%, from approximately $14.3 million for the three months ended March 31, 2024, to approximately $0.6 million for the three months ended March 31, 2025 [202]. - For the six months ended March 31, 2025, general and administrative expenses decreased by approximately $13.1 million, or 91.6%, from approximately $14.3 million for the six months ended March 31, 2024, to approximately $1.2 million [206]. - Net loss for the six months ended March 31, 2025, decreased by approximately $13.4 million, or 91.4%, from approximately $14.7 million for the six months ended March 31, 2024, to approximately $1.3 million [208]. - The company has incurred cumulative losses from operations amounting to $27.1 million and has negative cash flows from operating activities [211]. Cash Flow and Funding - For the six months ended March 31, 2025, net cash used in operating activities was approximately $1.1 million, primarily due to a net loss of approximately $1.3 million [215]. - Net cash used in investing activities for the six months ended March 31, 2025 was approximately $32,000, attributed to purchases of fixed and intangible assets [217]. - Net cash provided by financing activities for the six months ended March 31, 2025 was approximately $1.1 million, consisting of proceeds from the issuance of ordinary shares of approximately $1.0 million [218]. - The company reported a net cash used in operating activities of approximately $1.2 million for the six months ended March 31, 2024, primarily due to a net loss of approximately $14.7 million [216]. - Net cash provided by financing activities for the six months ended March 31, 2024 was approximately $3.7 million, including proceeds from PIPE investment of $2.5 million [219]. - As of March 31, 2025, the company did not have any off-balance sheet arrangements affecting liquidity or capital resources [220]. - The company believes it will have sufficient working capital for the next 12 months, but may seek additional funds if required [212]. - Cash at the end of the period for March 31, 2025 was $227,828, down from $1,146,341 at the end of March 31, 2024 [214]. - The company may face dilution of equity holders' ownership if additional funds are raised through equity financing [212]. Market Conditions - Graphite prices have declined due to China's export ban since December 1, 2023, which could adversely affect the company's financial condition [159]. - The surge in palm kernel shell prices has negatively impacted operational performance due to increased raw material costs [160]. - Geopolitical tensions and trade restrictions have disrupted supply chains, affecting the company's ability to transport and trade graphite efficiently [161]. - The competitive landscape in the graphene and graphite industry is driven by price, performance, and customer service, with fierce competition expected [166]. - The company is committed to adapting to evolving market conditions and regulatory changes to ensure sustainable growth and resilience [164]. Intellectual Property - The company holds all intellectual property rights to its technology and manufacturing processes, which are not subject to third-party claims [156]. - Graphjet Technology aims to be a low-cost producer of premium artificial graphite and graphene, leveraging patented technology for biomass conversion [151].
Energem (ENCP) - 2025 Q1 - Quarterly Report