2025 Annual Financial Report

Audit Report

Audit Opinion Type

Standard unqualified audit opinion

Signing Date

April 22, 2026

Audit Firm Name

Lixin Certified Public Accountants (Special General Partnership)

Audit Report Number

Xinhui CPA Report [2026] No. ZB10521

Certified Public Accountants

Zhang Huice, Liu Jian

Audit Report Body

To all shareholders of Shandong Haike New Source Material Technology Co., Ltd.:

Audit Opinion
We have audited the financial statements of Shandong Haike New Source Material Technology Co., Ltd. (hereinafter referred to as Haike New Source), including the consolidated and parent company balance sheets as of December 31, 2025, the consolidated and parent company income statements, consolidated and parent company cash flow statements, consolidated and parent company statements of changes in equity, and related notes to the financial statements. We believe that the attached financial statements are prepared in accordance with the provisions of enterprise accounting standards in all material respects and fairly reflect the financial position of Haike New Source as of December 31, 2025, as well as the operating results and cash flows for the year 2025.
Basis for Forming Audit Opinion
We conducted our audit in accordance with the auditing standards for certified public accountants in China. The section "Responsibilities of Certified Public Accountants for the Audit of Financial Statements" in the audit report further elaborates on our responsibilities under these standards. In accordance with the "Independence Standards for Certified Public Accountants No. 1 - Requirements for Independence in Financial Statement Audits and Reviews" and the Code of Ethics for Certified Public Accountants in China, we are independent of Haike New Source and have fulfilled other ethical responsibilities. We adhered to the independence requirements for auditing public interest entities during the audit. We believe that the audit evidence we obtained is sufficient and appropriate to provide a basis for our audit opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the period. Our responses to these matters are in the context of our audit of the financial statements as a whole and in forming our opinion thereon, and we do not express an opinion on these matters separately. The key audit matters identified in our audit are summarized as follows:

Key Audit Matter	How the Matter Was Addressed in the Audit
(1) Revenue Recognition	Refer to notes 5, 26, Revenue and notes 7, 39, Operating Revenue and Operating Costs in Haike New Source's financial statements. The main audit procedures we implemented regarding revenue recognition include: 1. Understanding and testing the design and effectiveness of key internal controls related to sales; 2. Performing analytical review procedures to assess the reasonableness of changes in revenue and gross margin; 3. Confirming sales amounts and receivable balances with major customers; 4. Verifying the relationship between major customers and Haike New Source; 5. Checking key terms of sales contracts to ensure compliance with accounting standards; 6. Performing detail tests on supporting documents; 7. Conducting cutoff tests for revenue recognized before and after the balance sheet date.
(2) Recoverability of Accounts Receivable	Refer to notes 5, 11, Financial Instruments and notes 7, 4, Accounts Receivable in Haike New Source's financial statements. As of the end of 2025, Haike New Source's accounts receivable amounted to RMB 1,496.84 million, with a provision for bad debts of RMB 76.07 million. Due to the management's need to assess the credit status of relevant customers and the significant impact of this estimate, we identified the recoverability of accounts receivable as a key audit matter. The main audit procedures implemented include: 1. Understanding and evaluating management's internal controls related to aging analysis and bad debt provisions; 2. Evaluating the reasonableness of the bad debt provision ratios; 3. Reviewing management's considerations for impairment testing; 4. Confirming the accuracy of accounts receivable balances; 5. Checking post-period collection situations to assess the reasonableness of bad debt provisions.

Key Audit Matter

How the Matter Was Addressed in the Audit

(1) Revenue Recognition

Refer to notes 5, 26, Revenue and notes 7, 39, Operating Revenue and Operating Costs in Haike New Source's financial statements. The main audit procedures we implemented regarding revenue recognition include: 1. Understanding and testing the design and effectiveness of key internal controls related to sales; 2. Performing analytical review procedures to assess the reasonableness of changes in revenue and gross margin; 3. Confirming sales amounts and receivable balances with major customers; 4. Verifying the relationship between major customers and Haike New Source; 5. Checking key terms of sales contracts to ensure compliance with accounting standards; 6. Performing detail tests on supporting documents; 7. Conducting cutoff tests for revenue recognized before and after the balance sheet date.

(2) Recoverability of Accounts Receivable

Refer to notes 5, 11, Financial Instruments and notes 7, 4, Accounts Receivable in Haike New Source's financial statements. As of the end of 2025, Haike New Source's accounts receivable amounted to RMB 1,496.84 million, with a provision for bad debts of RMB 76.07 million. Due to the management's need to assess the credit status of relevant customers and the significant impact of this estimate, we identified the recoverability of accounts receivable as a key audit matter. The main audit procedures implemented include: 1. Understanding and evaluating management's internal controls related to aging analysis and bad debt provisions; 2. Evaluating the reasonableness of the bad debt provision ratios; 3. Reviewing management's considerations for impairment testing; 4. Confirming the accuracy of accounts receivable balances; 5. Checking post-period collection situations to assess the reasonableness of bad debt provisions.

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