Silicon-carbide (SiC) substrate producer SICC (02631) reported first-half 2026 revenue of RMB 913.65 million, a 15.10% year-on-year increase driven by stronger demand for 8-inch and emerging 12-inch products. Principal operations contributed RMB 856.85 million, while other businesses added RMB 56.79 million.

Despite top-line growth, the group recorded a net loss attributable to shareholders of RMB 58.62 million (1H25: profit of RMB 10.88 million) after booking RMB 12.03 million in credit-related charges, RMB 18.10 million in inventory impairments and RMB 99.04 million in finance costs — the latter reflecting a sharp swing to RMB 118.38 million in foreign-exchange losses.

Quarterly momentum improved: second-quarter revenue reached a record RMB 548 million, up 42.06% year-on-year and 49.97% quarter-on-quarter. Q2 gross margin rose to 25.36%, helping the company post a quarterly net profit of RMB 1.89 million versus a Q1 loss, narrowing first-half losses.

Gross margin for 1H26 stood at 22.86%, up sequentially on higher 8-inch substrate mix (now above 50 % of sales) and ongoing cost-control measures. R&D spending remained robust at RMB 74.57 million, or 8.16 % of revenue, supporting advancement of 12-inch SiC substrate technology and liquid-phase P-type development.

Operating cash flow turned negative to RMB 20.26 million (1H25: +RMB 289.47 million) due to higher working-capital needs and lower profitability. Investment outflows expanded to RMB 2.84 billion, largely reflecting capacity expansion and foreign-exchange hedging activities. Total assets reached RMB 10.02 billion; cash and equivalents stood at RMB 3.14 billion. Short-term borrowings nearly doubled to RMB 1.26 billion, lifting total liabilities to RMB 2.91 billion, yet the gearing ratio improved slightly to 29.08 %.

Management cited accelerating adoption of SiC in high-voltage electric vehicles and AI-driven data-centre power systems as demand tailwinds. With expanded Shanghai and Jinan lines, first customer deliveries of 12-inch wafers, and a focus on overseas expansion, SICC expects scale benefits and stabilized pricing to support a gradual earnings recovery. No interim dividend was declared.

Basic and diluted loss per share were RMB 0.12 (1H25: earnings of RMB 0.03). Book value per share ended the period at RMB 14.66. SICC maintained compliance with HKEX public float requirements.