UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 20-F

(Mark One)

☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2025

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report:

For the transition period from            to

Commission file number: 001-42738

Delixy Holdings Limited

(Exact name of Registrant as specified in its charter)

(Translation of Registrant’s name into English)

Cayman Islands

(Jurisdiction of incorporation or organization)

883 North Bridge Road, #04-01 Southbank

Singapore 198785

(Address of principal executive offices)

Mr. Xie, Dongjian

+65 6291 3184

public@delixy.com

883 North Bridge Road, #04-01 Southbank

Singapore 198785

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Securities registered or to be registered pursuant to Section 12(g) of the Act: None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: 16,350,000 ordinary shares issued and outstanding as of December 31, 2025.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

☐ Yes ☒ No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

☐ Yes ☒ No

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the fi ling reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

☐ Item 17 ☐ Item 18

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes ☒ No

Table of Contents

INTRODUCTION

Except where the context otherwise requires and for purposes of this annual report only the term:

Delixy Holdings Limited is a holding company with all operations conducted in Singapore through Delixy Energy Pte. Ltd., our wholly-owned operating subsidiary. Our reporting and functional currency is the United States Dollar. Our financial year ends on December 31 of each year; references in this annual report to a financial year, such as “Financial Year 2025” or “FY2025”, relate to our financial year ended December 31 of that calendar year.

We obtained the industry and market data used in this annual report or any document incorporated by reference from industry publications, research, surveys and studies conducted by third parties and our own internal estimates based on our management’s knowledge and experience in the markets in which we operate. We did not, directly or indirectly, sponsor or participate in the publication of such materials, and these materials are not incorporated in this annual report other than to the extent specifically cited in this annual report. We have sought to provide current information in this annual report and believe that the statistics provided in this annual report remain up-to-date and reliable, and these materials are not incorporated in this annual report other than to the extent specifically cited in this annual report.

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This annual report contains forward-looking statements that reflect our current expectations and views of future events, all of which are subject to risks and uncertainties. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. You can find many (but not all) of these statements by the use of words such as “approximates,” “believes,” “hopes,” “expects,” “anticipates,” “estimates,” “projects,” “intends,” “plans,” “will,” “would,” “should,” “could,” “may” or other similar expressions in this annual report. These statements are likely to address our growth strategy, financial results and product and development programs. You must carefully consider any such statements and should understand that many factors could cause actual results to differ from our forward-looking statements. These factors may include inaccurate assumptions and a broad variety of other risks and uncertainties, including some that are known and some that are not. No forward-looking statement can be guaranteed and actual future results may vary materially. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to:

We base our forward-looking statements on our management’s beliefs and assumptions based on information available to our management at the time the statements are made. We caution you that actual outcomes and results may, and are likely to, differ materially from what is expressed, implied or forecast by our forward-looking statements. Accordingly, you should be careful about relying on any forward-looking statements. Except as required under the federal securities laws, we do not have any intention or obligation to update publicly any forward-looking statements after the distribution of this annual report, whether as a result of new information, future events, changes in assumptions, or otherwise.

PART I

Item 1. Identity of Directors, Senior Management and Advisers

Not applicable for annual reports on Form 20-F.

Item 2. Offer Statistics and Expected Timetable

Not applicable for annual reports on Form 20-F.

Item 3. Key Information

3.A. [Reserved]

3.B. Capitalization and Indebtedness

Not applicable for annual reports on Form 20-F.

3.C. Reasons for the Offer and Use of Proceeds

Not applicable for annual reports on Form 20-F.

3.D. Risk Factors

Risks and Challenges

Investing in our Class A Ordinary Shares involves risks. The risks summarized below are qualified by reference to “Risk Factors” beginning on page 1 of this annual report, which you should carefully consider before making a decision to purchase Class A Ordinary Shares. If any of these risks actually occurs, our business, financial condition or results of operations would likely be materially adversely affected. In such case, the trading price of our Class A Ordinary Shares would likely decline, and you may lose all or part of your investment.

These risks include but are not limited to the following:

Risks Related to Our Business and Industry

Risks Related to Our Securities

Investing in our Shares is highly speculative and involves a significant degree of risk. You should carefully consider the following risks, as well as other information contained in this annual report, before making an investment in our Company. The risks discussed below could materially and adversely affect our business, prospects, financial condition, results of operations, cash flows, ability to pay dividends and the trading price of our shares. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business, prospects, financial condition, results of operations, cash flows and ability to pay dividends, and you may lose all or part of your investment.

This annual report also contains forward-looking statements having direct and/or indirect implications on our future performance. Our actual results may differ materially from those anticipated by these forward-looking statements due to certain factors, including the risks and uncertainties faced by us, as described below and elsewhere in this annual report.

Risks Related to Our Business and Industry

We are dependent on our suppliers for the supply of crude oil and oil-based products. Any shortage or delay in the supply of crude oil and oil-based products from them may materially and/or adversely affect our business and results of operations if we cannot secure alternative sources of supply immediately

We depend on our suppliers for the supply of crude oil and oil-based products. This makes us susceptible to supply shortages or price fluctuations that could negatively impact our operating results. We currently purchase the crude oil and oil-based products from a number of suppliers. For the financial years ended December 31, 2024 and 2025, our top three suppliers accounted for approximately 63.2% and 47.7% of our total purchases, respectively.

If our relationship with any of our suppliers terminates or if any of our suppliers suffer a material disruption in production, we may experience difficulties and delays in obtaining the products we trade from alternative sources of supply and we may therefore be unable to obtain a sufficient quantity of products on acceptable terms without interruption to our business operations. Any interruption or delay in the supply of the products we trade, or the inability to obtain such products from alternate sources at acceptable prices and within a reasonable amount of time, would impair our ability to meet scheduled deliveries to our customers and could result in our customers cancelling their orders or switching to another supplier. Any such events could adversely affect our business, results of operations and financial condition.

A significant portion of our revenue is attributable to the sale of crude oil and our profitability may be adversely affected if demand for crude oil declines for any reason

We have a concentrated revenue portfolio as a significant portion of our revenue is attributable to the sale of crude oil. For the fiscal year ended December 31, 2025, trading in crude oil represented 59.3% of our total trading revenue, while trading in oil-based products represented the remaining 40.7% of our total trading revenue. There can be no assurance that we will be able to maintain a stable supply of crude oil from our suppliers or demand for crude oil from our customers. If our customers’ requirements change or if the demand for crude oil declines for any reason, including due to any fuel conservation measures, alternative fuel requirements, increasing consumer demand for alternatives to oil and natural gas, technological advances in fuel economy and energy generation devices, there may be a potential loss in revenue which would adversely affect our profitability.

We do not enter into long-term agreements with our customers and our customers are not subject to any minimum purchase requirement to place orders with us

We do not enter into long-term agreements with our customers and there is no assurance that our customers will continue to purchase from us in the future. Our customers are not subject to any minimum purchase requirement to place orders with us and they have the flexibility to place their orders based on their needs and on a case-by-case basis. If any of our major customers terminates its business relationship with us, and we fail to secure orders from new customers on a timely basis, there may be an adverse effect on our business operations, financial performance and profitability.

We are dependent on a small number of key customers

Our revenue is concentrated among a small number of customers. For the financial years ended December 31, 2024 and 2025, our top three customers accounted for approximately 41.9% and 58.3% of our revenue, respectively. If any of these customers were to reduce or cease their business with the Company, it could have a material adverse impact on the Company’s financial condition and results of operations.

The Company has taken steps to mitigate its customer concentration risk by diversifying its customer base and developing long-term relationships with its key customers as evidenced in the period under review. However, the Company remains exposed to customer concentration risk, and any significant changes in the business of its key customers could have a material adverse impact on its business.

In addition, the Company’s business is dependent on the continued success of its customers. If any of the Company’s customers were to experience financial difficulties or cease operations, it could have a material adverse impact on the Company’s business.

The Company is aware of the risks associated with customer concentration and is taking steps to mitigate these risks. However, investors should be aware of the potential for customer concentration to have a material adverse impact on the Company’s business.

We are reliant on customers and suppliers located within the PRC

Our business is reliant on customers and suppliers located within the PRC. For the financial years ended December 31, 2024 and 2025, the percentage of revenue derived from customers in the PRC was 54.5% and 29.2% respectively, while the percentage of products that we source from suppliers in the PRC was 22.6% and 51.6% respectively.

The Company has taken steps to mitigate its concentration risk in the PRC by diversifying its customer and supplier base and developing long-term relationships with its key customers and suppliers. However, the Company remains exposed to concentration risk in the PRC, and any significant changes in the business of its key customers and suppliers from the PRC could have a material adverse impact on its business.

If any of our key customers or suppliers in the PRC were to reduce their level of business with us, cease operations, or face adverse regulatory actions, it could materially and adversely affect our business, financial condition, and results of operations. The PRC government has substantial oversight and regulatory authority over the conduct of business activities within its jurisdiction, and any intervention or changes in its economic or regulatory policies could directly impact the operations of our customers and suppliers. Such changes could include increased scrutiny and restrictions on cross-border transactions or changes in international trade policies. The PRC’s regulatory environment is subject to change, and any changes in the policies, regulations, rules and the enforcement of laws of the PRC government may be implemented quickly with little advance notice. The imposition of additional restrictions on our customers’ or suppliers’ ability to conduct business, or any actions taken by the PRC government to influence or intervene in their operations could limit their ability to continue conducting business with us. This could have a material adverse impact on our business, financial condition and results of operations.

Our cash flows could be adversely affected by net operating cash outflows caused by a potential timing mismatch between the receipt of payments from our customers and the disbursement of payments to our suppliers

We typically procure our crude oil from global suppliers, including those in Europe, West Africa, the Middle East, Singapore, Malaysia and Brazil for sale to our customers which include refineries and trading companies in Southeast Asia, East Asia and the Middle East. For oil-based products, we generally procure them from suppliers in the PRC for sale to our customers which comprises mainly other traders and wholesalers in Southeast Asia, East Asia and the Middle East. While we typically settle full payment of our purchase orders with our suppliers immediately upon confirmation of the order, we generally grant our customers credit terms of up to 90 days, depending on our credit assessment of the customer and our relationship with such customers, resulting in a material cash flow mismatch. As such, we would record significant net operating cash outflows in the event that we accept too many of our customers’ orders in a particular period of time and are required to settle full payment of our back-to-back purchase orders with our suppliers.

We depend on timely payments from our customers for cash inflow to meet our payment obligations to our suppliers. There is no assurance that our cash flow management measures will function effectively, if at all. In the event of a significant cash flow mismatch or substantial cash outflow, our cash flow position may be adversely affected and we might have to raise funds through internal resources and/or banking facilities in order to meet our payment obligations to our suppliers in full and on time.

We may be unable to fully pass any increase in cost of sales to our customers

Our ability to obtain and maintain suitable pricing for our customers is essential. Depending on their individual needs and taking into consideration market trends, our customers may enter into either fixed price contracts or contracts where the price of the product is pegged to the prevailing market price at time of delivery. Where possible, we will enter into back-to-back agreements with our customers and suppliers, and the price we charge our customers is based on a cost-plus approach by adding a mark-up to our cost of purchase. In calculating the mark-up, we will consider factors such as our cost of purchase, quantity of product, delivery timelines, credit terms and our business relationship with the customer. Other factors that we take into consideration include where we have purchased the relevant products ahead of time with the intention of taking advantage of arbitrage windows and opportunities. However, we may not always be able to enter into back-to-back agreements and our Company may be unable to fully pass any increase in cost of sales to our customers. In particular, a significant increase in labor costs could exert downward pressure on our profit margins.

We depend on key management personnel

Our success depends significantly on the expertise, experience, continuity, network and committed service of our key management personnel, most of whom have an in-depth understanding of our industry and operations and would be difficult to replace. Our key management personnel, including Mr. Xie, Ms. Chong and Ms. Yao, are essential to our success because of their experience and connections in the oil trading market, their market development skills and expertise in managing our operations. Details of their expertise and experience are set out in the section headed “Directors and senior management” in this annual report. In addition, the maintenance of our existing business relationships as well as the reputation that our management team has established is dependent on the continued service of our key management personnel.

There is no assurance that these key management personnel will not voluntarily terminate their employment with us. We do not carry, and do not intend to procure, key person insurance on any of our senior management team.

As a result, the departure of any of our key management personnel could be disruptive to our business development and could have a material adverse effect on our business and financial conditions. We cannot guarantee that the services of such personnel will continue to be available to us or that we will be able to replace any such personnel with individuals who possess similar knowledge, experience or network.

We are dependent on our transport providers for the transport of our products

We also utilize and depend on the services of certain third-party service providers for our operations. In particular, and from time to time, we may engage third party transport providers, such as international haulers, shipping lines and transport companies, for freight forwarding and shipping services. In the event any such third party transport providers fail to satisfy their obligations or in the event there are any service disruptions or issues with delivery (such as leakage of the products we are transporting and/or a change in quality of the oil products within the cargo), this may result in our products being rejected by our customers and/or a breach of our contractual obligations towards our customers.

In addition, there is a risk that the use of vessels to transport crude oil and oil-based products may result in an oil spill and cause significant environmental damage. Vessels are also exposed to a high risk of damage and loss by fire, whether ignited by a terrorist attack, collision, or other cause, due to the high flammability and hazardous characteristics of crude oil and oil-based products transported in the vessels. The crew may also be inadvertently exposed to escaped gases from the crude oil and oil-based products transported in their vessel, and this may pose a risk to their health and safety. The operation of vessels is subject to strict regulations and vetting requirements that our third-party transport providers need to comply with. For the avoidance of doubt, we are not liable for the satisfaction of such regulations and requirements by such third-party transport providers. Generally, the regulations governing the transport of crude oil are applicable to the vessel owners, rather than to the charterers or end users. Specifically, in relation to the International Safety Management (ISM) Code, which provides an international standard for the safe management and operation of ships and for pollution prevention, our chartering agreement provides that any loss, damage, expense or delay caused by failure on the part of the owners to comply with the ISM Code shall be for the owner’s account. Our purchase agreements with our suppliers will also typically require that each vessel nominated to carry cargo be owned or demise chartered by a member of the International Tanker Owners Pollution Federation Limited (ITOPF) and have in place adequate insurance cover for oil pollution in accordance with the rules of the International Group of Protection and Indemnity Clubs. Where the vessel does not meet such requirements, the supplier may refuse to load the vessel. We believe that our arrangements adequately prevent any non-compliance with regulations and protect us from liability in the event of any failure to comply with regulations applicable to the transport of crude oil.

However, in the event of any accident or damage, our products may be affected and we may not be able to deliver our products to our customers in a timely manner. Our relationship with our suppliers may also be adversely affected. Any such events could therefore adversely affect our reputation, as well as our business, results of operations and financial condition.

We may fail to deliver our products timely to our customers or maintain our reputation and this can adversely affect our business, financial condition and results of operations

We believe that the reputation we have built over the years plays a significant role in attracting customers and securing our customers’ orders. Whether or not we can maintain or enhance our reputation depends largely on our ability to continue to provide quality and timely services to our customers. If we fail to meet their needs or are unable to deliver the products requested by them to the designated location in a timely manner, our customers may no longer perceive our services to be of a high quality and our reputation could be adversely affected. This will in turn negatively affect our business, financial condition and results of operations.

Natural disasters and other catastrophic events beyond our control, including but not limited to the COVID-19 pandemic, have and could continue in the future to adversely affect our business operations and financial performance

The occurrence of the global COVID-19 pandemic negatively affected our business between 2020 and 2022 due to the global imposition of movement control measures and a global plunge in oil prices, which resulted in reduced revenue for our business. The occurrence of one or more other natural disasters, such as fires, hurricanes, tornados, tsunamis, floods and earthquakes, geo-political events or military activities disrupting transportation, communication or utility systems; or other highly disruptive events, such as nuclear accidents, pandemics, unusual weather conditions or cyberattacks, could adversely affect our operations and financial performance. The occurrence of these events or another global pandemic could result in, among other things, operational disruptions, the lack of an adequate workforce in parts of or all of our operations and communications and transportation disruptions. This in turn could lead to decreased consumer confidence and spending, and increased volatility in Singapore, the United States and the global financial markets and economy. As a result, our business operations and financial performance may be adversely affected.

We operate in a competitive market

We compete with various international and local service providers. Competition may result in pricing pressures, declining revenue and profitability, or a loss of market share. We face competitors who may have strong competitive advantages, including longer operating histories, larger and broader customer bases, lower operating costs, more established relationships with a broader set of suppliers and customers, greater brand recognition, and greater financial, research and development, marketing, distribution, and other resources than us. In addition, new companies may enter the market with innovative business models or more appealing service offerings and disrupt the competitive landscape, making it even more challenging for us to maintain our market position. There is no guarantee that our strategies will remain competitive or successful in the future. Increased competition may result in pricing pressures and loss of our market share, which could have a material adverse effect on our business, financial condition and results of operations.

Changes in existing laws, regulations and government policies may cause us to incur additional costs

Our business operations are governed by various laws, regulations and government policies in Singapore. These laws and regulations may change from time to time. We may be unable to comply with all these requirements in time or at all or we may need to incur substantial costs to be compliant, which may adversely affect our business operations and financial condition.

Our business may be adversely affected by a deterioration in general economic conditions or a weakening of the broader energy industry

Our business is driven by crude oil prices, which are affected by both domestic and global supply and demand factors. A prolonged economic slowdown, a global recession, periods of high inflation, adverse events relating to the energy industry and local, regional and national economic conditions and factors could negatively impact our operations and therefore adversely affect our business, financial condition and results of operations. The risks associated with our business are more acute during periods of economic slowdown or recession because such periods may lead to greater fluctuations in crude oil prices and/or decreased demand for crude oil and oil-based products. During periods of high inflation, we may experience increased procurement, transportation and labor costs, as well as demand volatility due to economic uncertainty. While recent inflationary pressures have led to such increase in costs and impacted our operations, we have been able to mitigate this impact due to our strong market position and pricing power, which has allowed us to pass these costs on to our customers through back-to-back agreements. As a result, our profitability and operating results have not been impacted by recent inflationary pressures. However, we can provide no assurance that we will not be affected by such inflationary pressures in Singapore or globally in the future. In the event that the inflationary pressures continue to increase to any material extent, and we continue to pass along the increased costs to our customers, it may result in loss of sales and loss of customers, thereby adversely impacting our margins and results of operations.

We may implement business strategies and future plans that may not be successful

The successful implementation of our business strategies and future plans depends on a number of factors, including general market conditions, government policies, the availability of funds, competition and our ability to retain and recruit competent employees. There is no assurance that our business strategies and future plans can be implemented effectively and successfully as some of these factors are beyond our control. If any implementation of these strategies and plans fails or is delayed, we may be adversely affected by investment expenses that have not led to the anticipated results, the distraction of management from our core business or any damage to our brand or reputation. Additionally, if we fail to secure adequate funds in a timely manner, we may also be unable to pursue opportunities to expand our business.

Our inability to predict accurately market demand may affect our business operations and financial performance

The market demand for our products could decline, sometimes rapidly or unpredictably, due to general market conditions that are not specific to a particular company, such as real or perceived adverse economic or political conditions throughout the world, changes in the general outlook for corporate earnings, changes in interest or currency rates, or adverse investor sentiment generally. The market demand for our oil products may also decline because of factors that affect a particular industry such as labor shortages, increased production costs, and competitive conditions. Local, regional, or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the market generally and on specific investments. For example, in recent years, the COVID-19 pandemic, the large expansion of government deficits and debt as a result of government actions to mitigate the effects of the pandemic, Russia’s invasion of Ukraine, and the rise of inflation have resulted in extreme volatility in the global economy and in global financial markets. Economies and financial markets throughout the world are becoming increasingly interconnected. As a result, the value and liquidity of our trades may be negatively affected, which will in turn, impact our business, results of operations and financial condition.

In particular, Russia’s invasion of Ukraine led to significant geopolitical tensions and subsequent import and export bans. While we do not source any of our products from suppliers in Russia or trade with any customers from Russia, these trade sanctions and restrictions have affected global supply chains, led to a reduction in global oil supply and an increase in oil prices. The uncertainty and volatility in the global oil market that followed caused disruptions for our customers. However, due to our well established networks, we experienced a slight increase in volume for the financial year ended December 31, 2025. As of the date of this annual report, global oil supply and oil prices have since stabilized, and we do not anticipate any further significant impacts from the ongoing Russia-Ukraine conflict. However, should there be new developments in the Russia-Ukraine conflict, such as further escalations or additional sanctions, these could lead to renewed volatility in global oil supply and oil prices, thereby potentially impacting our business operations and financial performance.

We may use hedging strategies that may be unsuccessful

We may use hedging strategies to cover any outstanding positions we may hold from time to time. These strategies may be unsuccessful because there may be an imperfect correlation, or no correlation, between the price movements of the hedging instrument and the price movements of the trade being hedged. We are subject to the risk that our counterparty will default on its obligation to pay us, as well as the risk that we will not be able to meet our obligations to pay the other party to the agreement. Swap agreements may also involve the risk that there is an imperfect correlation between the return on our obligation to the counterparty and the return on the referenced asset. In addition, swap agreements are subject to market and illiquidity risk, leverage risk and hedging risk. The value of swaps, like many other derivatives, may move in unexpected ways and may result in losses for us. There can be no assurance that our hedging transactions (including by way of swap arrangements) will be effective. The use of hedging may also result in certain adverse tax consequences, and may also reduce our potential for profit.

We are vulnerable to fluctuations in foreign exchange rates

Our functional and presentation currency is U.S. dollars. While substantially all of our major contracts are denominated in U.S. dollars, our operating costs are incurred in a mix of currencies, predominantly the U.S. dollar and Singapore dollar. Some expenses, comprising primarily the salaries of Singapore employees, rent and payments to other contractors in Singapore are normally paid in Singapore dollars. Accordingly, movements in the exchange rates of any of these currencies relative to the U.S. dollar could adversely affect our results of operations and financial condition.

Our current insurance coverage may not sufficiently protect us against all the risks we are exposed to and this may adversely affect our business, results of operations and financial condition

There can be no assurance that our current insurance coverage will cover all our risks or adequately protect us against all liabilities arising from claims and litigation against us. We will have to bear any losses, damages or liabilities in the course of our operations arising from events for which we do not have adequate insurance coverage. Further, the insurance premium payable by us depends on various factors, including the scope and estimated contract sum set out in the service contracts with our customers and our insurance claim track record.

Additionally, our insurers may refuse to pay particular claims and our insurance policies may be voidable by the insurers if we take, or fail to take, certain actions as mandated by the insurers. Our ability to obtain and maintain adequate insurance may be adversely affected by conditions in the insurance market for which we have no control. There is no assurance that the insurance premium payable by us will not increase or that our insurance coverage will not be reduced in the future. If we are held liable for uninsured losses, the amounts of claims for insured losses exceed the limits of our insurance coverage or the insurance premium payable by us increases significantly, our business, results of operations and financial condition may be materially and adversely affected. In addition, we may not be able to obtain adequate insurance coverage at reasonable rates in the future during adverse insurance market conditions.

We may also be subject to calls or premiums in amounts based not only on our claim records but also the claim records of other members of the protection and indemnity associations through which we receive insurance coverage for tort liability, including pollution-related liability. Payment of these calls could result in significant expense to us, which could have a material adverse effect on our results of operations, cash flows and financial condition. Moreover, the protection and indemnity associations and other insurance providers reserve the right to make changes in insurance coverage with little or no advance notice. Any such events could adversely affect our results of operations and financial condition.

We may need to raise additional capital required to grow our business, and we may be unable to raise capital on terms acceptable to us or at all

Growing and operating our business may require significant cash outlays and capital expenditures and commitments. Although our current cash and cash equivalents, and anticipated cash flows from operating activities will be sufficient to meet our anticipated working capital requirements and capital expenditures in the ordinary course of business for at least 12 months from the date of this annual report, there is a risk that we may need additional cash resources in the future to fund our growth plans or if we experience adverse changes in business conditions or other developments. We may also need additional cash resources in the future if we find and wish to pursue opportunities for new investments, acquisitions, capital expenditures or similar actions. If we determine that our cash requirements exceed the amount of cash and cash equivalents we have on hand at the time, we will need to seek additional capital, potentially through equity or debt financing, to fund our growth. Our ability to access the credit and capital markets in the future as a source of liquidity, and the borrowing costs associated with such financing, are dependent upon market conditions. We cannot provide any assurance that our assumptions used to estimate our liquidity requirements will remain accurate due to unseen factors such as the recurrence of the COVID-19 global pandemic, risks of war and regional conflicts. In the event of a sustained market deterioration, and continued declines in revenues, we may need additional liquidity, which would require us to evaluate available alternatives and take appropriate actions. We cannot provide any assurance that we will be able to obtain additional sources of financing or liquidity in amounts or on terms acceptable to us, or at all.

If we fail to implement and maintain an effective system of internal controls, we may be unable to accurately or timely report our results of operations or prevent fraud, and investor confidence and the market price of our Class A Ordinary Shares may be materially and adversely affected

Effective internal control over financial reporting is necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, is designed to prevent fraud. Our failure to implement and maintain effective internal controls over financial reporting could result in errors in our financial statements that could result in a restatement of our financial statements, cause us to fail to meet our reporting obligations and cause investors to lose confidence in our reported financial information, which may result in volatility in and a decline in the market price of our Class A Ordinary Shares.

We are a public company in the United States subject to the Sarbanes-Oxley Act of 2002. Section 404 of the Sarbanes-Oxley Act of 2002, or Section 404, will require that we include a report of management on our internal control over financial reporting in our annual report on Form 20-F. In addition, if we cease to be an “emerging growth company” as such term is defined in the JOBS Act, our independent registered public accounting firm must attest to and report on the effectiveness of our internal control over financial reporting on an annual basis. Our management may conclude that our internal control over financial reporting is ineffective. Moreover, even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified if it is not satisfied with our internal controls or the level at which our controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements differently from us. In addition, after we become a public company, our reporting obligations may place a burden on our management, operational and financial resources and systems for the foreseeable future. We may be unable to timely complete our evaluation testing and any required remediation.

During the course of documenting and testing our internal control procedures, in order to satisfy the requirements of Section 404, we may identify material weaknesses and deficiencies in our internal control over financial reporting. The Public Company Accounting Oversight Board, or PCAOB, has defined a material weakness as “a deficiency, or a combination of deficiencies in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim statements will not be prevented or detected on a timely basis.”

In addition, if we fail to maintain the adequacy of our internal control over financial reporting, as these standards are modified, supplemented or amended from time to time, we may be unable to conclude on an ongoing basis that we have effective internal control over financial reporting in accordance with Section 404. Generally speaking, if we fail to achieve and maintain an effective internal control environment, we could suffer material misstatements in our financial statements and fail to meet our reporting obligations, which would likely cause investors to lose confidence in our reported financial information. This could in turn limit our access to capital markets, harm our results of operations and lead to a decline in the trading price of our Class A Ordinary Shares. Additionally, ineffective internal control over financial reporting could expose us to increased risk of fraud, misuse of corporate assets and legal actions under the United States securities laws and subject us to potential delisting from the Nasdaq Capital Market, to regulatory investigations and to civil or criminal sanctions.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of internal control over financial reporting as of December 31, 2025, the Company determined that there were no control deficiencies that constituted material weaknesses.

We will be subject to changing laws, rules and regulations in the U.S. regarding regulatory matters, corporate governance and public disclosure that will increase both our costs and the risks associated with non-compliance

We are subject to rules and regulations by various governing bodies and self-regulatory organizations, including, for example, the SEC and the Nasdaq Capital Market, which are responsible for the protection of investors and the oversight of companies whose securities are publicly traded, and to new and evolving regulatory measures under applicable law. Our efforts to comply with these new and changing laws and regulations have resulted in and are likely to continue to result in increased general and administrative expenses and a diversion of management time and attention from revenue-generating activities to compliance activities.

Moreover, as these laws, regulations and standards are subject to varying interpretations, their application in practice may evolve over time as new guidance becomes available. This evolution may result in continuing uncertainty regarding compliance matters and additional costs necessitated by ongoing revisions to our disclosure and governance practices. If we fail to address and comply with these regulations and any subsequent changes, we may be subject to penalties and this may harm our business.

Fluctuations in the price of crude oil and oil-based products may adversely affect our business

We are exposed to risks arising from fluctuations in the price of crude oil, which can be volatile. Any material or sustained decline in crude oil prices, or change in buyer preferences, could have a material adverse effect on our performance.

Crude oil prices are affected by numerous factors beyond our control, including worldwide oil supply and demand. The price of crude oil may be affected by numerous factors such as:

A low crude oil price environment or decline in the price of crude oil could adversely affect our business, results of operations and financial condition. They could also negatively impact our ability to access sources of capital, including equity and debt markets.

Our susceptibility to litigation, arbitration and other proceedings could have an adverse effect on our business

We may be, from time to time, involved in various litigation matters arising in the ordinary course of business, or otherwise. These matters may include, among other things, contract disputes, personal injury claims, employment matters, environmental matters, governmental claims for taxes or duties, securities, or commodities matters. The potential costs to resolve any claim or other litigation matter, or a combination of these, may have a material adverse effect on us because of potentially negative outcomes, the costs associated with asserting our claims or defending such lawsuits, and the diversion of management’s attention to these matters.

We are subject to the risk of labor disputes

We employ employees in Singapore and are subject to the local labor laws of Singapore. While we have not been materially adversely affected by any labor-related developments or industrial action in the past, there can be no assurance that such developments or actions may not occur in the future. Such occurrences may have a material adverse impact on our business, financial condition and results of operations.

Any fraudulent behavior by our employees and/or third parties may have an adverse effect on us

Our employees or third parties could engage in fraudulent behavior which could lead to potential criminal, civil and employment sanctions as well as negative publicity. This could result in a material adverse effect on our business, financial condition and results of operations. Our operations are subject to various anti-bribery laws, including the Prevention of Corruption Act 1960 of Singapore and the U.S. Foreign Corrupt Practices Act. Our employees and/or third parties acting as agents for us could engage in fraudulent behavior against us on their own or others’ initiative and act against our interests. Such actions could include, entering into agreements with our competitors thereby limiting free competition, document fraud, bribes, fraudulent commission agreements, facilitation payments and bribes to get access to exclusive business, among others. Whether intentional or not, such actions could potentially expose us to potential legal liabilities and reputational harm.

Our operations are subject to cyber security risks that could have a material adverse effect on our business, financial condition and results of operations

Information technology plays a crucial role in all of our operations. To remain competitive, our hardware, software and related services must interact with our suppliers and customers efficiently, record and process our financial transactions accurately, and obtain the data and information to enable the analysis of trends and plans and the execution of our strategies. Our information technology systems are subject to possible breaches and other threats that could cause us harm. If our systems for protecting against cyber security risks prove not to be sufficient, we could be adversely affected by, among other things, loss or damage of intellectual property, proprietary information, or customer data; interruption of business operations; or additional costs to prevent, respond to, or mitigate cyber security attacks. These risks could have a material adverse effect on our business, financial condition and results of operations.

Nonetheless, our business model does not heavily rely on third-party software or services, particularly those that are directly integrated into our products or operations. This reduces our dependency on external technology and lessens the potential impact of cybersecurity breaches or disruptions originating from these third-party entities. While data breaches and operational disruptions can still occur, the physical presence of our business allows for alternative methods of product distribution and customer service, reducing the overall impact of cybersecurity related incidents on our operations. Despite our perception of the lower risk of cybersecurity related incidents materially affecting our operations, we plan to prioritize the implementation of cybersecurity measures to maintain a secure and reliable business environment. For example, we plan to (i) conduct more rigorous assessments of potential suppliers’ cybersecurity practices, including penetration testing and vulnerability assessments; (ii) incorporate cybersecurity clauses into our business contracts; (iii) include specific security requirements and data protection protocols in our vendor contracts to ensure consistent cybersecurity standards across our supply chain; (iv) educate our employees on cybersecurity threats by providing training for employees to recognize and report phishing attempts, social engineering tactics, and other cyber threats; and (v) implement cybersecurity awareness tools and simulations to test employees’ knowledge and response to potential threats. By implementing these measures, we hope that our ability to respond to and recover from any eventual cybersecurity incidents will be enhanced.

We are exposed to the credit risks of our customers

We extend credit terms of up to 90 days for our customers. Our average accounts receivable turnover days were approximately 10.6 days and 23.7 days for the financial years ended December 31, 2024, and 2025, respectively. Our customers may be unable to meet their contractual payment obligations to us, either in a timely manner or at all.

The reasons for payment delays, cancellations or default by our customers may include insolvency or bankruptcy, or insufficient financing or working capital due to late payments by their respective customers. While we did not experience any material order cancellations by our customers during the financial years ended December 31, 2024 and 2025, there is no assurance that our customers will not cancel their orders and/or refuse to make payment in the future in a timely manner or at all. We may not be able to enforce our contractual rights to receive payment through legal proceedings. In the event that we are unable to collect payments from our customers, we are still obliged to pay our suppliers in a timely manner and thus our business, financial condition and results of operations may be adversely affected.

Our business is subject to supply chain interruptions

We rely on our suppliers’ abilities to deliver our products as part of the supply chain logistics. The factors that can adversely affect our operations include, but are not limited to:

Any increased costs from delays, cancellations, and insurance, or disruption to, or inefficiency in, the supply chain network of our suppliers, whether due to geopolitical conflicts such as Russia’s invasion of Ukraine or the conflicts in the Middle East, including the 2026 Iran war, pandemic outbreaks, or other factors, could affect our revenue and profitability. If we fail to manage these risks effectively, we could experience a material adverse impact on our reputation, revenue, and profitability. Russia’s invasion of Ukraine led to significant geopolitical tensions and subsequent import and export bans. While we do not source any of our products from suppliers in Russia or trade with any customers from Russia, these trade sanctions and restrictions have affected global supply chains and led to an increase in procurement, transportation and labor costs for our crude oil and oil-based products. Our supply chains were materially impacted by the war, leading to increased costs. However, we were able to mitigate this impact due to our strong market position and pricing power, which allowed us to pass these costs on to our customers through back-to-back agreements. As a result, our business, results of operations and financial condition for the financial years ended December 31, 2024 and 2025 were not materially impacted by such increase in costs. However, we may not always be able pass all of our costs on, and our revenue and profitability may be affected by future supply chain disruptions if we are unable to manage such risks effectively. Furthermore, such supply chain disruptions have an indirect impact on our business as the uncertainty and volatility in the global oil market that followed caused disruptions for our customers, leading to a decrease in demand for our crude oil and oil-based products. As a result, we experienced a decrease in revenue for the financial year ended December 31, 2025. In relation to the Russia-Ukraine conflict, as of the date of this annual report, the global oil market and demand for oil have since stabilized, and we do not anticipate any further significant impacts from the ongoing conflict. However, should there be new developments in the Russia-Ukraine conflict, such as further escalations or additional sanctions, these could lead to renewed volatility in the global oil market and a potential decrease in demand for our crude oil and oil-based products.

Moving forward, we do not expect to experience such supply chain disruptions in the future because we source our goods from a number of suppliers. To the best of our knowledge, we have not received any information from our suppliers pertaining to any present or potential supply chain disruptions as well.

The ongoing conflict involving Iran has also contributed to volatility in global energy markets, including fluctuations in oil prices, disruptions to shipping routes, and increased transportation and insurance costs. Such volatility may increase the cost of procuring crude oil and oil-based products and may affect the availability and timing of shipments. While we generally seek to mitigate such impacts through back-to-back arrangements and pricing mechanisms that allow us to pass increased costs on to our customers, we may not always be able to do so fully or on a timely basis. If we are unable to pass through such cost increases, our margins and profitability could be adversely affected.

Our existing credit facilities contain certain covenants and restrictions that may limit the flexibility of our Company in the way in which we organize our subsidiaries and/or operate our business

We are currently party to two existing short term credit facilities with the Bank of China Limited (Singapore Branch) (“BOC”) and United Overseas Bank Limited (“UOB”) respectively. The terms of such credit facilities provide, among others, that the Company is not to undertake or permit any reorganization, amalgamation, reconstruction, takeover, or change of shareholders without the respective bank’s prior written consent. Prior to our initial public offering and listing of our Class A Ordinary Shares on the Nasdaq Capital Market, we sought consent from the respective banks to confirm that the reorganization and listing of our Class A Ordinary Shares on the Nasdaq Capital Market will not cause a breach of the credit facilities and/or in any way affect their validity or any part thereof. However, we did not receive such confirmation from the relevant banks.

We therefore cannot assure you that we are not in default of or that we are in full compliance with the terms of our credit facilities with BOC and UOB. Notwithstanding the above, as of December 31, 2024 and December 31, 2025, and as of the date of this annual report, the amount outstanding with respect to these credit facilities is zero, US$2,104,000 and zero. Further, in the event that we utilize the credit facilities prior to confirmation being obtained from these banks and are required to make immediate repayment, our directors and management believe that we will be able to repay the borrowings without significantly affecting our cash flows and/or operations. Our directors and management are also of the view that there will be no material adverse effect on our business and operations even in the event the banks terminate such short term credit facilities, as (i) we do not draw down on these facilities regularly given that there are no amounts outstanding currently, and (ii) we have alternative sources of liquidity and financing that we can tap on without the need for such back to back letters of credit to be issued.

Risks Related to Our Securities

We may not maintain the listing of our Class A Ordinary Shares on the Nasdaq Capital Market, which could limit investors’ ability to make transactions in our Class A Ordinary Shares and subject us to additional trading restrictions

To continue the listing of our Class A Ordinary Shares on the Nasdaq Capital Market, we must maintain certain financial and share price levels and we may be unable to meet these requirements in the future. We cannot assure you that our Class A Ordinary Shares will continue to be listed on the Nasdaq Capital Market in the future.

If the Nasdaq Capital Market delists our Class A Ordinary Shares and we are unable to list our Class A Ordinary Shares on another national securities exchange, we expect that our Class A Ordinary Shares could be quoted on an over-the-counter market in the United States. If this were to occur, we could face significant material adverse consequences, including:

As long as our Class A Ordinary Shares are listed on the Nasdaq Capital Market, U.S. federal law prevents or preempts the states from regulating their sale. However, the law does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar their sale. Further, if we were no longer listed on the Nasdaq Capital Market, we would be subject to regulations in each state in which we offer our shares.

Any of these factors may result in significant and sudden changes in the volume and price at which our shares will trade.

In the event of market volatility, shareholders of public companies have often brought securities class action suits against those companies following periods of instability in the market price of their securities. If we are involved in a class action suit, it could divert a significant amount of our management’s attention and other resources from our business and operations and require us to incur significant expenses to defend the suit, which could harm our results of operations. Any such class action suit, whether successful or not, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations.

On April 23, 2026, we received a notification letter from the Nasdaq Stock Market LLC (“Nasdaq”) indicating that we are not in compliance with Nasdaq Listing Rule 5550(a)(2), which requires listed securities to maintain a minimum bid price of US$1.00 per share. The notification stated that the closing bid price of our Class A Ordinary Shares had fallen below US$1.00 per share for 30 consecutive business days, from March 11, 2026 to April 22, 2026. The notification did not result in any immediate impact on the listing or trading of our Class A Ordinary Shares. Under Nasdaq rules, we have been granted a compliance period of 180 calendar days, until October 20, 2026, to regain compliance. To regain compliance, the closing bid price of our Class A Ordinary Shares must be at least US$1.00 per share for a minimum of ten consecutive business days during the compliance period. If we do not regain compliance by October 20, 2026, we may be eligible for an additional 180 calendar day compliance period, provided we meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for the Nasdaq Capital Market (other than the bid price requirement) and provide written notice of our intention to cure the deficiency during the second compliance period, which may include implementing a reverse stock split, if necessary. If we are unable to regain compliance within the available compliance period(s), our Class A Ordinary Shares may be subject to delisting, which could limit investors’ ability to make transactions in our Class A Ordinary Shares, reduce their liquidity and trading volume, and adversely affect their market price. We are actively monitoring the bid price of our Class A Ordinary Shares and considering all available options to regain compliance with Nasdaq’s minimum bid price requirement.

The trading price of our Ordinary Share may be volatile, which could result in substantial losses to investors

The trading price of our Class A Ordinary Shares may be subject to rapid and substantial volatility, which could make it difficult for prospective investors to assess the rapidly changing value of our Class A Ordinary Shares and result in substantial losses to investors.

There have been instances of extreme stock price run-ups followed by rapid price declines and strong stock price volatility with recent initial public offerings, especially among those with relatively smaller public floats. As a relatively small-capitalization company with a relatively small public float, we may experience greater stock price volatility, extreme price run-ups, lower trading volume and less liquidity than large-capitalization companies. In particular, our Class A Ordinary Shares may be subject to rapid and substantial price volatility, low volumes of trades and large spreads in bid and ask prices. Such volatility, including any stock-run up, may be unrelated to our actual or expected operating performance and financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our Class A Ordinary Shares.

The volatility and fluctuations in the trading price of our Class A Ordinary Shares may be due to factors beyond our control and for reasons that are unrelated to our actual or expected performance. In addition, if the trading volumes of our Class A Ordinary Shares are low, persons buying or selling in relatively small quantities may easily influence prices of our Class A Ordinary Shares. This low volume of trades could also cause the price of our Class A Ordinary Shares to fluctuate greatly. Holders of our Class A Ordinary Shares may also not be able to readily liquidate their investment or may be forced to sell at depressed prices due to low volume trading. Broad market fluctuations and general economic and political conditions may also adversely affect the market price of our Class A Ordinary Shares.

In addition to market and industry factors, the price and trading volume for our shares may be highly volatile for factors specific to our own operations, including the following:

Companies with public floats comparable to our public float have experienced extreme volatility that was seemingly unrelated to the underlying performance of the respective company. We may experience similar volatility, which may make it difficult for prospective investors to assess the value of our Class A Ordinary Shares

In addition to the risks addressed above in “- The trading price of our Class A Ordinary Shares may be volatile, which could result in substantial losses to investors,” our Class A Ordinary Shares may be subject to extreme volatility that is seemingly unrelated to the underlying performance of our business. Recently, companies with comparable public floats have experienced instances of extreme stock price run-ups followed by rapid price declines, and such stock price volatility was seemingly unrelated to the respective company’s underlying performance. Although the specific cause of such volatility is unclear, our public float may amplify the impact the actions taken by a few shareholders have on the price of our shares, which may cause our share price to deviate, potentially significantly, from a price that better reflects the underlying performance of our business. Should our Class A Ordinary Shares experience run-ups and declines that are seemingly unrelated to our actual or expected operating performance and financial condition or prospects, prospective investors may have difficulty assessing the rapidly changing value of our Class A Ordinary Shares.

If securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations regarding our Class A Ordinary Shares, the market price for our Class A Ordinary Shares and trading volume could decline

The trading market for our Class A Ordinary Shares will be influenced by research or reports that industry or securities analysts publish about our business. If one or more analysts downgrade our Class A Ordinary Shares, the market price for our Class A Ordinary Shares would likely decline. If one or more of these analysts cease to cover us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause the market price or trading volume for our Class A Ordinary Shares to decline.

If we are classified as a passive foreign investment company, United States taxpayers who own our securities may have adverse United States federal income tax consequences

We are a non-U.S. corporation and, as such, we will be classified as a passive foreign investment company, which is known as a PFIC, for any taxable year if, for such year, either

Passive income generally includes dividends, interest, rents, royalties (other than rents or royalties derived from the active conduct of a trade or business) and gains from the disposition of passive assets.

If we are determined to be a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. taxpayer who holds our securities, the U.S. taxpayer may be subject to increased U.S. federal income tax liability and may be subject to additional reporting requirements.

It is possible that, for our current taxable year or for any subsequent year, more than 50% of our assets may be assets which produce passive income. We will make this determination following the end of any particular tax year. For purposes of the PFIC analysis, in general, a non-U.S. corporation is deemed to own its pro rata share of the gross income and assets of any entity in which it is considered to own at least 25% of the equity by value.

For a more detailed discussion of the application of the PFIC rules to us and the consequences to U.S. taxpayers if we were determined to be a PFIC, see “Material Tax Considerations - Passive Foreign Investment Company Considerations.”

Short selling may drive down the market price of our Class A Ordinary Shares

Short selling is the practice of selling shares that the seller does not own but rather has borrowed from a third party with the intention of buying identical shares back at a later date to return to the lender. The short seller hopes to profit from a decline in the value of the shares between the sale of the borrowed shares and the purchase of the replacement shares, as the short seller expects to pay less in that purchase than it received in the sale. As it is in the short seller’s interest for the price of the shares to decline, many short sellers publish, or arrange for the publication of, negative opinions and allegations regarding the relevant issuer and its business prospects in order to create negative market momentum and generate profits for themselves after selling the shares short. These short attacks have, in the past, led to selling of shares in the market. If we were to become the subject of any unfavorable publicity, whether such allegations are proven to be true or untrue, we could have to expend a significant amount of resources to investigate such allegations and/or defend ourselves. While we would strongly defend against any such short seller attacks, we may be constrained in the manner in which we can proceed against the relevant short seller by principles of freedom of speech, applicable state law or issues of commercial confidentiality.

As a “controlled company” within the meaning of the Nasdaq Capital Market Rules, we may rely on exemptions from certain corporate governance requirements that provide protection to shareholders of other companies

We are a “controlled company” as defined under the Nasdaq Capital Market Rules, because one of our shareholders, namely Mega Origin holds more than 50% of our voting power. As a result, for so long as we remain a controlled company as defined under that rule, we are permitted to elect to rely, and may rely, on certain exemptions from corporate governance rules of the Nasdaq Capital Market Rules including:

We do not intend to rely on these exemptions applicable to a “controlled company” and will instead rely on the exemptions provided to foreign private issuers to be exempt from the corporate governance requirements of the Nasdaq Capital Market listing rules. However, in the event we cease to be a foreign private issuer, we intend to rely on these exemptions applicable to a “controlled company”. As a result, you may not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements.

Mr. Xie, our Executive Director and an indirect controlling shareholder, has significant influence over us, including control over decisions that require the approval of shareholders, which will limit your ability to influence the outcome of matters submitted to shareholders for a vote.

We are currently controlled, indirectly by Mr. Xie. As long as Mr. Xie directly or indirectly owns or controls at least a majority of our outstanding voting power, he will have the ability to exercise substantial control over all corporate actions requiring shareholder approval, irrespective of how our other shareholders may vote, including the election and removal of Directors and the size of our Board of Directors, any amendment of our charter documents, or the approval of any merger or other significant corporate transaction, including a sale of substantially all of our assets. Even if Mr. Xie’s indirect ownership falls below 50%, he will continue to be able to strongly influence or effectively control our decisions. Additionally, Mr. Xie’s interests, or the interests of our Executive Officers and Directors as a whole, may not align with the interests of our other shareholders.

As a company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from Nasdaq Capital Market corporate governance listing standards. These practices may afford less protection to shareholders than they would enjoy if we complied fully with Nasdaq Capital Market corporate governance listing standards

As a foreign private issuer that has applied to list our Class A Ordinary Shares on the Nasdaq Capital Market, we rely on a provision in the Nasdaq Capital Market corporate governance listing standards that allows us to follow Cayman Islands law with regard to certain aspects of corporate governance. This allows us to follow certain corporate governance practices that differ in significant respects from the corporate governance requirements applicable to U.S. companies listed on the Nasdaq Capital Market.

We intend to rely on home country practice to be exempted from certain of the corporate governance requirements of Nasdaq, namely; (i) there will not be a necessity to have regularly scheduled executive sessions with independent Directors; and (ii) there will be no requirement for the Company to obtain Shareholder approval prior to an issuance of securities in connection with (a) the acquisition of stock or assets of another company; (b) equity-based compensation of Executive Officers, Directors, employees or consultants; (c) a change of control; and (d) transactions other than public offerings.

You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law

We are an exempted company incorporated under the laws of the Cayman Islands with limited liability. Our corporate affairs are governed by our Amended and Restated Memorandum and Articles of Association, the Companies Act and the common law of the Cayman Islands. We will also be subject to the U.S. securities laws. The rights of shareholders to take action against our Directors and us, actions by minority shareholders and the fiduciary duties of our Directors to us under Cayman Islands law are governed by our Amended and Restated Memorandum and Articles of Association, the Companies Act and the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands (as compared to the U.S. law) as well as from English common law. The decisions of the English courts are of highly persuasive authority, but are not binding on Cayman Islands courts (except for those decisions handed down from the Judicial Committee of the Privy Council to the extent that these have been appealed from the Cayman Islands courts). The rights of our shareholders and the fiduciary duties of our Directors under Cayman Islands law are broadly similar to those in other common law jurisdictions, but there may be differences in the statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands has a different body of securities laws than the United States, and provide significantly less protection to investors. In addition, if shareholders want to proceed against the Company outside of the Cayman Islands, they will need to demonstrate that they have the standing to initiate a shareholder derivative action in a federal court of the United States. There is no guarantee that the courts of the Cayman Islands would automatically recognize or enforce against us judgments of courts of Singapore or the United States predicated upon the civil liability provisions of the Singapore securities laws or the federal securities laws of the United States or any state. In addition, the courts of the Cayman Islands will not recognize and enforce a judgment predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities imposed by those provisions are taxes, fines or penal in nature, or otherwise contrary to public policy, including punitive damages.

Shareholders of Cayman Islands exempted companies like us have no general rights under Cayman Islands law to inspect corporate records (other than the Amended and Restated Memorandum and Articles of Association, the register of mortgages and charges and any special resolutions passed by shareholders) or to obtain copies of lists of shareholders of these companies. Our Directors are not required under our Amended and Restated Memorandum and Articles of Association to make our corporate records available for inspection by our shareholders. This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder resolution or to solicit proxies from other shareholders in connection with a proxy contest.

Certain corporate governance practices in the Cayman Islands, which is our home country, differ significantly from requirements for companies incorporated in other jurisdictions such as U.S. states These practices may afford less protection to shareholders than they would enjoy if we complied fully with corporate governance listing requirements of such exchanges. We intend to rely on home country practice to be exempted from certain of the corporate governance requirements of Nasdaq, namely; (i) there will not be a necessity to have regularly scheduled executive sessions with Independent Directors; and (ii) there will be no requirement for the Company to obtain Shareholder approval prior to an issuance of securities in connection with (a) the acquisition of stock or assets of another company; (b) equity-based compensation of Executive Officers, Directors, employees or consultants; (c) a change of control; and (d) transactions other than public offerings. Accordingly, our shareholders may be afforded less protection than they otherwise would under rules and regulations applicable to U.S. domestic issuers.

As a result of all of the above, shareholders may have more difficulty in protecting their interests in the face of actions taken by our management, members of the Board or controlling shareholder than they would as shareholders of a company incorporated in a U.S. state. For a discussion of significant differences between the provisions of the Companies Act and the laws applicable to companies incorporated in a U.S. state and their shareholders, see “Certain Cayman Islands Company Considerations - Differences in Corporate Law.”

Recently introduced economic substance legislation of the Cayman Islands may impact us or our operations

The Cayman Islands, together with several other non-European Union jurisdictions, have recently introduced legislation aimed at addressing concerns raised by the Council of the European Union as to offshore structures engaged in certain activities which attract profits without real economic activity. Effective January 1, 2019, the International Tax Co-operation (Economic Substance) Act (as amended) (the “Substance Law”) and issued Regulations and Guidance Notes came into force in the Cayman Islands introducing certain economic substance requirements for “relevant entities” which are engaged in certain “relevant activities,” which in the case of exempted companies incorporated before January 1, 2019, will apply in respect of financial years commencing July 1, 2019, onwards. A “relevant entity” includes an exempted company incorporated in the Cayman Islands; however, it does not include an entity that is tax resident outside the Cayman Islands. Accordingly, for so long as we are a tax resident outside the Cayman Islands, we are not required to satisfy the economic substance test under the Substance Law. Although it is presently anticipated that the Substance Law will have little material impact on us or our operations, as the legislation is new and remains subject to further clarification and interpretation it is not currently possible to ascertain the precise impact of these legislative changes on us.

Certain judgments obtained against us by our shareholders may not be enforceable

We are a Cayman Islands exempted company with limited liability and substantially all of our assets are located outside of the United States. In addition, all of our current Directors and Executive Officers are nationals and residents of countries other than the United States and substantially all of the assets of these persons are located outside the United States. Service of court documents on a Cayman Islands company can be effected by serving the documents at the company’s registered office and it may be possible to enforce foreign judgments in the Cayman Islands against a Cayman Islands company, subject to some exceptions. However, if investors wish to serve documents on and/or enforce foreign judgments against our Directors and Executive Officers, they will need to ensure that they comply with the rules of the jurisdiction where our Directors and Executive Officers are located. As a result, it may be difficult for a shareholder to effect service of process within the United States upon these persons or to enforce against us or them judgments obtained in United States courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States. Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands may render you unable to enforce a judgment against our assets or the assets of our Directors and Executive Officers. For more information regarding the relevant laws of the Cayman Islands, see “Enforcement of Civil Liabilities.” As a result of all of the above, our shareholders may have more difficulty in protecting their interests through actions against us or our Executive Officers, Directors or major shareholders than would shareholders of a corporation incorporated in a jurisdiction in the United States, depending on where our Directors and Executive Officers are located.

We are an emerging growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements

We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from various requirements applicable to other public companies that are not emerging growth companies including, most significantly, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act for so long as we are an emerging growth company. As a result, if we elect not to comply with such auditor attestation requirements, our investors may not have access to certain information they may deem important.

The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the extended transition period. As a result of this election, our future financial statements may not be comparable to other public companies that comply with the public company effective dates for these new or revised accounting standards.

We are a foreign private issuer within the meaning of the Exchange Act, and as such we are exempt from certain provisions applicable to United States domestic public companies

Because we are a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, including:

We will be required to file an annual report on Form 20-F within four months of the end of each financial year. In addition, we intend to publish our financial results on a semi-annual basis through press releases distributed pursuant to the rules and regulations of the Nasdaq Capital Market. Press releases relating to financial results and material events will also be furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC will be less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers. As a result, you may not be afforded the same protections or information that would be made available to you if you were investing in a U.S. domestic issuer.

We may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses to us

As discussed above, we are a foreign private issuer, and therefore, we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act. The determination of foreign private issuer status is made annually on the last Business Day of an issuer’s most recently completed second financial quarter, and, accordingly, the next determination will be made with respect to us on June 30, 2025. In the future, we would lose our foreign private issuer status if (i) more than 50% of our outstanding voting securities are owned by U.S. residents; and (ii) a majority of our Directors or Executive Officers are U.S. citizens or residents, or we fail to meet additional requirements necessary to avoid the loss of foreign private issuer status. If we lose our foreign private issuer status, we will be required to file with the SEC periodic reports and registration statements on U.S. domestic issuer forms, which are more detailed and extensive than the forms available to a foreign private issuer. We will also have to comply with U.S. federal proxy requirements, and our Directors, Executive Officers and 10% shareholders will become subject to the short-swing profit disclosure and recovery provisions of Section 16 of the Exchange Act. In addition, we will lose our ability to rely upon exemptions from certain corporate governance requirements under the listing rules of the Nasdaq Capital Market. As a U.S. listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer.

As a Nasdaq-listed public company, we incur significantly increased costs and devote substantial management time to complying with public company requirements

As a company whose Class A Ordinary Shares are listed on the Nasdaq Capital Market, we incur additional legal, accounting and other expenses associated with being a public reporting company, particularly after we cease to qualify as an emerging growth company. For example, we are required to comply with the reporting and other requirements of the Securities and Exchange Commission (the “SEC”) and the rules and corporate governance standards of the Nasdaq Capital Market. Compliance with these requirements has increased our legal and financial compliance costs and has made certain activities more time-consuming and costly.

In addition, our management and other personnel devote substantial time to complying with public company reporting obligations and other regulatory requirements. As a result, our management’s attention may be diverted from operational and other business matters to these compliance-related activities. We cannot predict or estimate the amount of additional costs we may incur as a result of maintaining our status as a public company.

In addition, changing laws, regulations and standards relating to corporate governance and public disclosure continue to create uncertainty for public companies, increase legal and financial compliance costs and make some activities more time-consuming. These laws, regulations and standards are subject to varying interpretations, in many cases due to their lack of specificity, and their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This may result in continuing uncertainty regarding compliance matters and higher costs associated with ongoing revisions to our disclosure and governance practices.

We expect to continue to invest resources to comply with evolving laws, regulations and standards, and such investments may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance-related activities. If our efforts to comply with new laws, regulations and standards differ from the interpretations or expectations of regulatory authorities due to ambiguities related to their application in practice, regulatory authorities may initiate legal proceedings against us, and our business, financial condition and results of operations could be adversely affected.

If we fail to meet applicable listing requirements, the Nasdaq Capital Market may delist our Class A Ordinary Shares from trading, in which case the liquidity and market price of our Shares could decline

Our Class A Ordinary Shares are listed on the Nasdaq Capital Market. However, we cannot assure you that we will be able to continue to meet the continued listing standards of the Nasdaq Capital Market in the future. If we fail to comply with the applicable listing standards and Nasdaq Capital Market delists our Class A Ordinary Shares, we and our shareholders could face significant adverse consequences, including:

The National Securities Markets Improvement Act of 1996, a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Because our Class A Ordinary Shares are listed on the Nasdaq Capital Market, they qualify as covered securities. Although the states are preempted from regulating the sale of our securities, the federal statute allows states to investigate companies if there is a suspicion of fraud and, if there is a finding of fraudulent activity, states can regulate or bar the sale of covered securities in a particular case.

If our Class A Ordinary Shares were to be delisted from the Nasdaq Capital Market, they would no longer qualify as covered securities, and we would become subject to regulation in each state in which we offer our securities. This could increase the complexity and cost of future securities offerings and adversely affect the liquidity and market price of our Class A Ordinary Shares. If we fail to meet applicable listing requirements, Nasdaq Capital Market may delist our Shares from trading, in which case the liquidity and market price of our Shares could decline.

As a result of the dual-class share structure of our share capital, Mega Origin Holdings Limited has and will continue to have voting control over our Company. The interests of Mega Origin Holdings Limited may not align with those of our other shareholders, limiting or precluding our shareholders’ ability to influence corporate matters.

Our share capital consists of Class A Ordinary Shares and Class B Ordinary Shares. Each holder of Class A Ordinary Shares is entitled to one (1) vote per share on all matters submitted to a vote at a general meeting of shareholders, while each holder of Class B Ordinary Shares is entitled to fifty (50) votes per share. As a result of this dual-class share structure and the 50:1 voting ratio between our Class B Ordinary Shares and Class A Ordinary Shares, Mega Origin Holdings Limited, our controlling shareholder, holds all of the issued and outstanding Class B Ordinary Shares and therefore controls a substantial majority of the total voting power of our issued and outstanding share capital.

This concentration of voting power allows Mega Origin Holdings Limited to control matters submitted to our shareholders for approval, including the election and removal of directors, mergers, consolidations and other business combinations, amendments to our amended and restated memorandum and articles of association, the approval of significant corporate transactions, and other matters requiring shareholder approval. Accordingly, Mega Origin Holdings Limited has considerable influence, and effectively controls, the outcome of corporate actions requiring shareholder approval for the foreseeable future.

Because the interests of Mega Origin Holdings Limited may differ from those of our other shareholders, the dual-class share structure and concentrated voting control may discourage, delay or prevent a change in control of our Company or unsolicited acquisition proposals that other shareholders may believe are in their best interests. Without the consent of Mega Origin Holdings Limited, we may be prevented from entering into transactions that could be beneficial to our minority shareholders. The concentration of ownership and voting control may also adversely affect the market price of our Class A Ordinary Shares.

In addition, unless our Class B Ordinary Shares are converted into Class A Ordinary Shares or otherwise cease to be outstanding in accordance with our amended and restated memorandum and articles of association, our shareholding structure will remain a dual-class structure, which will continue to result in significant voting control being concentrated with Mega Origin Holdings Limited. For more information regarding our principal shareholders and their affiliated entities, see “Principal Shareholders.”

Further issuances of Class B Ordinary Shares may dilute the voting power of holders of our Class A Ordinary Shares.

We may issue additional Class B Ordinary Shares in the future. The issuance of additional Class B Ordinary Shares could dilute the relative voting power of holders of our Class A Ordinary Shares.

Each holder of Class A Ordinary Shares is entitled to one (1) vote per share on all matters submitted to a vote at a general meeting of shareholders, while each holder of Class B Ordinary Shares is entitled to fifty (50) votes per share. As a result, holders of Class B Ordinary Shares have significantly greater voting power than holders of Class A Ordinary Shares. If we issue additional Class B Ordinary Shares, the overall voting power of holders of Class B Ordinary Shares relative to holders of Class A Ordinary Shares would increase, which could further diminish the ability of holders of Class A Ordinary Shares to influence matters requiring shareholder approval. Such matters include, among others, the election of directors, amendments to our amended and restated memorandum and articles of association, mergers, acquisitions, and other significant corporate transactions.

Accordingly, future issuances of Class B Ordinary Shares may further concentrate voting control in the holders of such shares and may result in corporate decisions that are not aligned with the interests of holders of our Class A Ordinary Shares.

Item 4. Information on the Company

Recent Developments 

Initial Public Offering

On July 10, 2025, we completed our initial public offering on the Nasdaq Capital Market. In the offering, we sold 1,350,000 ordinary shares, par value US$0.000005 per share (the “Ordinary Shares”), and the selling shareholders, Mega Origin Holdings Limited and Novel Majestic Limited, sold an aggregate of 650,000 Ordinary Shares, in each case at a public offering price of US$4.00 per Ordinary Share. Bancroft Capital, LLC acted as sole lead underwriter for the offering. We received gross proceeds of approximately US$5.4 million from the offering, before deducting underwriting discounts and other offering expenses. We did not receive any proceeds from the sale of Ordinary Shares by the selling shareholders or by the resale shareholders under the concurrent resale prospectus covering an aggregate of 3,000,000 Ordinary Shares. Our Ordinary Shares commenced trading on the Nasdaq Capital Market on July 9, 2025 under the ticker symbol “DLXY.”

February 2026 Extraordinary General Meeting

On February 23, 2026, we held an extraordinary general meeting of our shareholders. At the meeting, our shareholders approved by special resolution the re-designation and re-classification of our authorized and issued share capital, and the adoption of our second amended and restated memorandum and articles of association, to implement a dual-class share structure. As a result, our authorized share capital of US$2,500, divided into 500,000,000 ordinary shares of par value US$0.000005 each, was re-designated and re-classified into 450,000,000 Class A Ordinary Shares of par value US$0.000005 each and 50,000,000 Class B Ordinary Shares of par value US$0.000005 each, and our 16,350,000 issued and outstanding ordinary shares were re-designated and re-classified into 7,174,000 Class A Ordinary Shares and 9,176,000 Class B Ordinary Shares. The 9,176,000 Class B Ordinary Shares were re-designated from ordinary shares held by Mega Origin Holdings Limited, and the 7,174,000 Class A Ordinary Shares were re-designated from ordinary shares held by all other holders. Each Class A Ordinary Share is entitled to one vote per share, and each Class B Ordinary Share is entitled to fifty votes per share. Class B Ordinary Shares are convertible into Class A Ordinary Shares on a one-for-one basis at the option of the holder, but Class A Ordinary Shares are not convertible into Class B Ordinary Shares under any circumstances.

At the same meeting, our shareholders also approved by ordinary resolution the adoption of the Delixy Holdings Limited 2026 Equity Incentive Plan, the form of which is filed as Exhibit 10.1 to our Current Report on Form 6-K furnished to the SEC on February 25, 2026.

In addition, our shareholders approved at the same meeting, by ordinary resolution, the consolidation of all of the issued and unissued shares of our company, of whatever class or series, at a ratio of not less than one share for every two shares and not more than one share for every five hundred shares, with the exact consolidation ratio (being a whole number within such range) to be determined by our board of directors in its sole discretion within 180 days from the date of passage of the resolution (the "Share Consolidation"), and the authorization of our board of directors to deal with any fractional entitlements arising from the Share Consolidation in such manner as our board of directors considers expedient. As of the date of this annual report, our board of directors has not effected the Share Consolidation.

Receipt of Nasdaq Notification of Minimum Bid Price Deficiency

On April 23, 2026, we received a notification letter from the Nasdaq Stock Market LLC (“Nasdaq”) indicating that we are not in compliance with Nasdaq Listing Rule 5550(a)(2), which requires listed securities to maintain a minimum bid price of US$1.00 per share. The notification stated that the closing bid price of our Class A Ordinary Shares had fallen below US$1.00 per share for the 30 consecutive business days from March 11, 2026 to April 22, 2026. The notification did not result in any immediate impact on the listing or trading of our Class A Ordinary Shares. Under Nasdaq rules, we have been granted a compliance period of 180 calendar days, until October 20, 2026, to regain compliance. If we do not regain compliance by October 20, 2026, we may be eligible for an additional 180 calendar day compliance period, subject to satisfaction of certain other continued listing standards and the provision of written notice of our intention to cure the deficiency, which may include implementing a reverse stock split, if necessary. We are actively monitoring the bid price of our Class A Ordinary Shares and considering all available options to regain compliance with Nasdaq’s minimum bid price requirement. See “Item 3.D. Risk Factors—We may not maintain the listing of our Class A Ordinary Shares on the Nasdaq Capital Market…” for additional information.

4.A. History and Development of the Company

Corporate Structure

Our Company was incorporated in the Cayman Islands on May 16, 2024, under the Companies Act as an exempted company with limited liability. On incorporation, our authorized share capital was US$500,000 divided into 500,000,000 ordinary shares, par value of US$0.001 each. Following incorporation, our entire issued share capital was held solely by Mr. Xie. Per the reorganization executed on August 21, 2024, Mr. Xie was issued an additional 99,999 shares, and on the same date, he transferred 18.62%, 4.90%, 4.90%, 4.90% and 3.34% of his shares to Novel Majestic, Cosmic Magnet, Dragon Circle, Rosywood Holdings and Golden Legend respectively. On November 6, 2024, Mega Origin transferred its entire equity interest in Delixy to us in consideration of our allotment and issue to it of one share credited as fully paid. On November 19, 2024, Mr. Xie transferred his 63.34% interest in our Company to his wholly-owned company, Mega Origin, for cash at par.

On November 29, 2024, for purposes of recapitalization in anticipation of the initial public offering, the Company effected a 1:200 sub-division of its shares (a “forward stock split”) and, following the forward stock split, the cancellation of 99,500,000,000 shares in its authorized but unissued share capital, resulting in its authorized share capital becoming $2,500 divided into 500,000,000 shares of a par value of $0.000005 each. Concurrently, Mega Origin surrendered 3,167,200 ordinary shares par value US$0.000005 each, Novel Majestic surrendered 931,000 ordinary shares par value US$0.000005 each, Cosmic Magnet surrendered 245,000 ordinary shares par value US$0.000005 each, Dragon Circle surrendered 245,000 ordinary shares par value US$0.000005 each, Rosywood Holdings surrendered 245,000 ordinary shares par value US$0.000005 each and Golden Legend surrendered 167,000 ordinary shares par value US$0.000005 each to the Company, respectively or 25.0% of their shareholdings each. None of these shareholders surrendering their ordinary shares received any consideration for surrender of their ordinary shares, nor are there any agreements or arrangements in place under which any of these shareholders will surrender their respective ordinary shares. Unless otherwise indicated, all references to Ordinary Shares, share data, per Share data, and related information have been retroactively adjusted, where applicable, in this annual report to reflect the 1:200 forward stock split of our Ordinary Shares and the shares surrendered by our existing shareholders on November 29, 2024 as if they had occurred at the beginning of the earlier period presented.

Historically, our Group was comprised of Delixy Energy. We completed a reorganization whereby the entire share capital of Delixy Energy was transferred to Delixy International, resulting in our holding of the entire issued share capital of Delixy indirectly.

Organization Chart

The chart below sets out our corporate structure as at the date of this annual report.

Entities

A description of our principal operating subsidiary is set out below.

Delixy Energy Pte. Ltd.

Delixy Energy Pte. Ltd was incorporated in Singapore on September 10, 2007 and is our indirect wholly-owned subsidiary with an issued share capital of 1,000,000 shares of S$1.00 each which is held as to 100.0% by Delixy International Limited following the internal group reorganization on November 6, 2024. Delixy Energy carries on the business of trading in crude oil and oil-based products.

4.B. Business Overview

OVERVIEW

We are a holding company incorporated in the Cayman Islands with operations conducted by our Singapore subsidiary which is incorporated in Singapore.

As a holding company incorporated in the Cayman Islands with no material operations, we conduct our operations in Singapore through our operating subsidiary, Delixy Energy Pte. Ltd. We are principally engaged in the trading of oil related products, which can be broadly categorized into (i) crude oil and (ii) oil-based products such as naphtha, motor gasoline, gas oil, fuel oil, asphalt, base oil and other petrochemicals.

We trade our products across multiple countries in Southeast Asia, East Asia and the Middle East, and we have established a presence in the oil trading markets in these countries. For the financial years ended December 31, 2024 and 2025, our total trading revenue decreased by 2.3% from US$314,916,000 to US$307,747,000, respectively.

Crude oil trading represents a core aspect of our business as it accounts for a significant portion of our revenue. For the financial years ended December 31, 2024 and 2025, trading in crude oil represented 53.8% and 59.3% of our total trading revenue, respectively. The trading in various oil-based products make up the rest of our total trading revenue and for the financial years ended December 31, 2024 and 2025, these make up 46.2% and 40.7% of our total trading revenue, respectively.

We typically enter into back-to-back agreements with our suppliers after our customer has agreed on the terms of the purchase so as to reduce our exposure and trading risks. We may also enter into swap agreements or trade in oil and oil-based products derivatives to further hedge our positions.

We leverage on our strong existing relationships with our customers and suppliers as well as our deep experience and understanding of the oil industry to provide certain value-added services to our customers. This includes recommending to our customers optimal trading strategies tailored to their specific needs, and providing shipping and logistical support where required. In addition, our financing capabilities allow us to extend credit terms to our customers while satisfying the immediate payment terms required by our suppliers.

OUR COMPETITIVE STRENGTHS

We believe our main competitive strengths are as follows:

We have the financial capability to provide our customers with financing alternatives and credit terms

Most suppliers of crude oil and oil-based products require payment on delivery with minimal credit terms and this lack of flexibility may limit buyers who may require more accommodating payment arrangements. On the other hand, we are able to provide our customers with credit terms of up to 90 days by leveraging our strong balance sheet position as well as short term loan facilities available to the Group. Our ability to extend these advantageous credit terms to our customers allows us to cater to the diverse needs of our customers across multiple countries and to provide them with the financial flexibility they may require for their business operations. This in turn allows us to develop and maintain long-lasting relationships with our customers based on trust, and to provide differentiated offerings centered on flexible financing and/or delivery options. Our principal funding sources include short term loan facilities drawn down and secured by the underlying physical commodity and trade. From time to time, in recognition of our strong financial position, certain financial institutions have been willing to extend short term credit facilities to us. As of December 31, 2024, December 31, 2025, and as of the date of this annual report, the amount outstanding with respect to these credit facilities is zero, US$2,104,000 and zero. This approach not only minimizes risks but also grants us access to competitively priced funding, thereby allowing us to deliver flexible financing solutions to our customers whilst maintaining financial prudence. For more information regarding the material terms of our short term credit facilities, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources.”

We have a diversified portfolio of oil products

We trade in a diversified portfolio of oil products, including crude oil, naphtha, motor gasoline, gas oil, fuel oil, asphalt and base oil. Crude oil serves as the basis for a variety of petroleum products such as propane, asphalt, petrochemical feedstocks and more. With a portfolio founded on crude oil and its derivatives, we are able to cater to our customers’ demands across various industries and geographic regions. This ensures that our revenue is not seasonal or dependent on any specific sector or industry. In addition, in line with our ongoing commitment to global sustainability, we are also actively exploring opportunities to expand our product offerings to include sustainable fuels, including sustainable fuel products related to hydrogen energy and stationary energy storage systems. This would further enhance the variety of our product offerings and ensure that our revenue streams remain resilient to changes in global trends.

We have an experienced management team with strong relationships across our value chain

Our management team headed by our Executive Chairman, Chief Executive Officer and Executive Director, Mr. Xie, has decades of experience in oil trading as well as in the oil industry generally, including oil refining and logistics.

While we are not dependent on any individual supplier or groups of suppliers of crude oil or oil-based products, we maintain strong relationships with these suppliers and are able to leverage on our relationships with them to gain market insights and ensure a reliable supply of crude oil and oil-based products to our customers. We are also able to tap on the strong relationships we have with storage facilities providers as well as fleet and logistics providers in the event that we are required to provide bulk breaking or transportation services to our clients. Our team of traders are experienced and well equipped to identify and leverage arbitrage windows to maximize our value-added services, as well as to ensure that we hedge any outstanding positions that we may have from time to time effectively, thereby reducing any potential losses in our activities.

We have robust and strong risk management and internal controls capabilities

We believe that the ability to manage risk is one of our key strengths. Risk management is a core function under the supervision of our senior leadership structure. Our sound risk management practices have contributed to our positive performance through the volatile market environment in recent years and have helped to mitigate earnings volatility. We have stringent hedging practices and generally only enter into swaps or trade in derivatives of the oil and oil-based products we sell to the extent required to hedge our positions. Further, to the extent commercially practicable, we also prefer to enter into back-to-back agreements where we will place a back-to-back purchase order with our suppliers only after our customer has confirmed the terms of its order. This is done to limit any potential exposure we may have in terms of price fluctuations.

Our risk management processes in relation to the onboarding of new customers and suppliers are managed closely by a risk management committee which comprises three (3) members, with each member having a veto right in respect of the onboarding of every new customer and assessment of every new supplier. After approval is obtained for onboarding of the customer, our operations team will then take over to service the customer, and our finance team will monitor the trades entered into and our positions on an ongoing basis. For trades where we obtain bank financing and where our purchase pricing terms differ from our selling pricing terms, we may operate tripartite accounts at brokerage houses with our banks, for which all our derivative trading positions require the approval of ourselves and our bankers. We believe that these measures have enabled us to weather through the differing operating climates in the last two (2) decades that we have been in operation.

We are strategically located in Singapore, Asia’s refined products trading hub

Products such as gas oil and fuel oil are primarily sourced from Europe and the Middle East and distributed to companies across Southeast Asia, East Asia and the Middle East. Singapore has an extensive tank farm capacity and is supported by strong bunkering demand in the region. Coupled with the ease of doing business in the country, availability of banking facilities and an established and stable legal system, Singapore is both well-equipped and strategically positioned to be an oil trading hub. Our position in Singapore therefore allows us to take advantage of arbitrage opportunities arising from price differentials or variations in pricing formulas across regions and time zones.

OUR STRATEGIES

Expand our trading team

We believe that our success is derived from our deep understanding of the markets in which we trade in, our products and our customers. We draw on our knowledge and understanding of the local markets, the specific demands of our customers, as well as of the various types of oil-based products to shape our risk management strategies and provide to our customers various value-added services, including advising them on optimal trading strategies.

To further strengthen this competitive advantage of ours, we plan to expand our trading team by hiring market researchers and traders. In particular, we are aiming to expand the team of market researchers whose primary focus will be to conduct in-depth market research, including analyzing external reports, data trends and supply and demand projections. We also aim to expand the team of traders who will continuously monitor the markets to better identify arbitrage opportunities and ensure that our trades are effectively carried out.

Expand into the trading of other oil related products

We plan to leverage on our existing trading expertise and expand our product offering range beyond crude oil and oil-based products to include other oil related products, such as liquefied natural gas (“LNG”) and liquefied petroleum gas (“LPG”). To support this expansion, we have strengthened our team by employing traders with specific experience in LNG and LPG markets, ensuring that we are well-equipped to understand the unique market dynamics and risks associated with these products. We are currently in the process of establishing our presence in the LNG market. This includes ongoing efforts to secure LNG tank storage capacity and arrange terminal transshipment services. We expect to secure LNG tank space in South China in the near term, which will be a key milestone before commencing LNG trading operations. In parallel, we are also registering ourselves as an LNG trader with major oil companies to facilitate market entry. With respect to LPG, our trading activities have not yet commenced. This is primarily due to current market conditions, where LPG import prices—particularly from key suppliers such as the Middle East and the United States—remain higher than domestic supply prices in China. Nevertheless, we are actively preparing the necessary logistics infrastructure to support future LPG import operations when market conditions become more favorable. We will continue to assess our trading portfolio and selectively expand into new products where we have the requisite capabilities and where such expansion is expected to enhance our business. This product diversification strategy positions us to remain adaptable to evolving global energy demand trends.

Expand business and operations through development, strategic acquisitions and business cooperations

Whilst we intend to focus on our principal business activities in the trading of crude oil and oil-based products, we also plan to explore opportunities to diversify and expand our business and operations through internal development, as well as by collaborating with suitable partners through strategic acquisitions and business cooperations, including joint ventures and/or strategic alliances. For example, if a suitable opportunity arises, we may seek to acquire other oil trading businesses and oil trading related service providers that will complement our current business. We are currently not involved in any discussions for any potential acquisitions or business cooperations with any party. We may also seek to develop oil logistics services capabilities, such as oil freight and storage services, as well as other renewable energy related services to further diversify our business into regions beyond the PRC.

OUR BUSINESS

We conduct our operations in Singapore through our operating subsidiary, Delixy Energy Pte. Ltd. We are principally engaged in the trading of oil related products, which can be broadly categorized into (i) crude oil and (ii) oil-based products such as fuel oils, motor gasoline, additives, gas condensate, base oils, asphalt, petrochemicals and naphtha (heavy gasoline). We trade our products across countries in Southeast Asia, East Asia and the Middle East.

For the financial years ended December 31, 2024 and 2025, our total trading revenue decreased by 2.3% from US$314,916,000 to US$307,747,000 respectively.

Crude Oil

Crude oil is a naturally occurring unrefined fossil fuel composed of hydrocarbons which are organic compounds consisting primarily of hydrogen and carbon. Once extracted from underground reservoirs through drilling wells, crude oil is transported to refineries where it undergoes various processes such as distillation and refining, forming the basis for a variety of petroleum products such as propane, asphalt, petrochemical feedstocks, among others. It is a primary raw material for many industries including transportation, manufacturing and agriculture.

Crude oil prices are volatile and can be affected by numerous factors beyond our control, including worldwide oil supply and demand. The price of crude oil may be affected by numerous factors such as: the level of economic activity in the markets we serve; regional political developments and military conflicts; economic sanctions; weather conditions and natural disasters; conservation and environmental protection efforts; the level of crude oil inventories; the ability of OPEC and other major oil-producing or oil-consuming nations to influence global production levels and prices; governmental regulations and actions, including the imposition of taxes and trade restrictions; market uncertainty; exchange rates; speculative activities by those who buy and sell oil and gas on the world markets, including commodity futures trading; availability and capacity of infrastructure, processing facilities and necessary transportation; supply chain disruptions; the price and availability of new technology; the availability and cost of alternative sources of energy; and the impact of climate change considerations and actions towards energy transition on the demand for the products in which we trade in. In terms of volatility, we note that throughout the period under review, being January 1, 2024 to December 31, 2025, brent crude traded between a high of US$91.17 per barrel to a low of US$58.92 per barrel, with an average price of US$74.03. This underscores the volatility in the prices of the principal raw materials which we trade in.

Crude oil trading represents a core aspect of our business as it accounts for a significant portion of our revenue. For the financial years ended December 31, 2024 and 2025, trading in crude oil represented 53.8% and 59.3% of our total trading revenue, respectively. The trading in various oil-based products make up the rest of our total trading revenue and for the financial years ended December 31, 2024 and 2025, these make up 46.2% and 40.7% of our total trading revenue, respectively.

For the fiscal year ended December 31, 2025, our trading revenue composition reflected a shift in the relative weighting of our primary product lines. While we experienced growth in our crude oil trading business, the overall revenue mix was influenced by tactical adjustments in our fuel oil sales. These shifts were primarily driven by our customers' evolving procurement strategies, as they adjusted their feedstock selections to capitalize on prevailing market crack margins and the immediate utility of specific fuel oil grades as refinery feedstocks.

We view these variations in product mix as a reflection of transient market dynamics rather than a long-term structural change in our business model. Our operations are designed to remain highly agile, enabling us to continuously optimize our procurement and sales strategies to align with customer needs across our key markets in the PRC, South Korea, and Singapore. Consequently, we do not anticipate that these fluctuations in product mix will have a material adverse impact on our results of operations.

Other Oil-Based Products

Other oil-based products that we trade in include fuel oils, motor gasoline, additives, gas condensate, base oils, asphalt, petrochemicals and naphtha (heavy gasoline). Crude oil is a raw material for these oil-based products, and the prices of these oil-based products are correlated to crude oil prices. Their prices are volatile and may be affected by factors similar to those affecting crude oil prices as described above.

The trading in various oil-based products make up the rest of our total trading revenue and for the financial years ended December 31, 2024 and 2025, these make up 46.2% and 40.7% of our total trading revenue, respectively.

We generally procure our oil-based products from suppliers in the PRC, Singapore, Malaysia and Europe to sell to our customers comprising mainly other traders and wholesalers in Southeast Asia, East Asia and the Middle East. We also leverage on our relationships with oil blenders who have capabilities to blend oil-based products and other feedstocks or additives into other oil-based products to purchase our oil-based products. Many of our customers have storage tanks in Malaysia and Singapore to take delivery for sale into the rest of the Association of Southeast Asian Nations (“ASEAN”) countries in the region.

Our customers and suppliers

We source crude oil from oil producers and oil majors, storage facilities as well as other oil traders globally including Europe, West Africa, Middle East, Singapore, Malaysia and Brazil. We generally procure oil-based products from oil refineries, as well as other wholesalers and distributers in the PRC, Singapore, Malaysia and Europe. We purchase on an order-by-order basis and we typically do not enter into any long-term supply agreements with our suppliers. We also do not enter into any offtake agreements. We believe that this allows us to respond to market fluctuations (whether as to price, demand or otherwise) more effectively. While we have good relationships with our suppliers and make recurrent purchases from many of our suppliers, we are not dependent on any major supplier.

Our traders have longstanding and good relationships with our customers and suppliers, as well as a comprehensive and experienced understanding of the oil industry. Our network of trusted suppliers and partners ensure that we are able to offer and deliver our products on time and in compliance with our customers’ specifications. We select our suppliers from our approved list of suppliers based on their prices, quality, past performance and timeliness of delivery, and we have a risk management committee that is responsible for assessing every new supplier we deal with. In the last three (3) financial years, we have not experienced any material difficulty in sourcing suppliers or shortage of supplies based on our customers’ needs.

Our customers for crude oil are mainly refineries and trading companies in Southeast Asia, East Asia and the Middle East. Our customers for oil-based products are mainly other traders and wholesalers as well as storage facilities owners who undertake product blending in Singapore and Malaysia. Our traders maintain regular contact with our customers to understand their needs and to provide relevant information to support their needs and operations. We believe that our customers purchase crude oil and oil-based products from us instead of directly sourcing from our suppliers for various reasons, including our ability to provide our customers with credit terms of up to 90 days, our longstanding business relationships with our customers, as well as our ability to cater to their irregular and unplanned demands. Our team’s extensive industry knowledge and in-depth understanding of our customers’ needs also allows us provide guidance to our customers on the time and frequency of them placing orders and the price to place such orders at. Such value-added services allow us to develop and deepen the longstanding business relationships we have with our customers.

While we maintain a close and longstanding relationship with our customers and suppliers and are reliant on a small number of key customers and suppliers, we do not enter into any long-term or standing contractual agreements with our customers and suppliers. This allows us to maintain our flexibility, respond quickly to market fluctuations and take advantage of arbitrage windows more effectively. Our sale and purchase agreements with our customers and suppliers respectively are governed by standard terms, with the material terms relating to the quantity and quality of the product, delivery, price, payment and inspection requirements.

Our business process

Prior to onboarding any new customer or supplier, our risk management committee comprising three (3) members, each having a veto right, will undertake the necessary KYC checks or background checks before approving such onboarding. Every new customer or supplier must be approved by a unanimous vote of all members of our risk management committee. We will also assess the credit worthiness of the customer to determine the initial credit terms granted, which will be assessed on an ongoing basis. Please refer to the section entitled “Our pricing and credit policy” for more details.

Subsequently, the operations team (largely comprising the traders) will then take over to manage the client relationship and the trading activities, while our finance team monitors our trades and positions on an ongoing basis. We also assess our customers continually to review their business scope, operation status and records, as well as monitor their transaction volumes to reduce any risk of them engaging in any illegal or sanctioned activities. In addition, we are also able to leverage on our good relationships with our customers and suppliers to gather market information (including any investigation into any of our customers and suppliers), which may be indicative of risk factors in relation to anti-money laundering or illegal activities.

After a customer has been onboarded, our traders typically receive enquiries from customers by phone or email. Customers will typically specify the product, quantity, and delivery details in the purchase request, which we will then check with our suppliers on availability and delivery timeline. To the extent commercially practicable, we enter into back-to-back agreements to reduce our exposure and trading risks. Once we have obtained the price for the relevant product and confirmed the availability for delivery, we will then confirm their orders in writing. After our customer has agreed on the terms of the order, we will place the back-to-back purchase order with our suppliers in writing. Where required by our customers, we may also work with our third-party suppliers to provide freight and delivery of the commodity. However, such demand for freight and delivery services from us has reduced in recent years as it has become more common for suppliers to arrange for delivery to the destination as part of their services. Through our network of suppliers coupled with our strong financial position, we are also able to liaise with other third party service providers to deploy a number of other shipping and logistics strategies including making bulk, breaking bulk and storage for future use.

While our purchases are generally driven by customer orders as we endeavor to enter into back-to-back agreements, we continue to keep regular contact with our suppliers who provide us with updated quotations for the products we trade in. Once we receive the relevant price from our suppliers, we will consider if the purchase price offered by our suppliers is reasonable and if necessary, we will negotiate with our suppliers for a more favorable price with reference to price indices such as ICE Brent crude price, the expected purchase quantity, payment terms and length of credit period offered by our suppliers. We also keep up to date with the prevailing trends in the market. Our traders are able to analyze market trends to predict and take advantage of arbitrage windows such as purchasing assets in a market where there is oversupply for sale in a market where there is increased demand, as well as predicting periods of higher demand and purchasing the relevant products ahead of time when prices are more depressed. As delivery of the products we trade in is usually approximately two (2) months after the order, we are also able to take advantage of such timing differences and arbitrage opportunities therein. As such, where opportunities arise, or where our traders are of the view that there may be arbitrage opportunities, we may purchase crude oil and oil-based products in large quantities without back-to-back customer orders, and undertake activities such as bulk breaking which involves reselling these products in smaller quantities to our customers. This strategy enhances our flexibility when dealing with our customers as we are able to respond to our customers’ immediate or unplanned purchase demands for the products within a short time frame and accommodate their delivery schedule in a more flexible manner. In turn, we may be able to increase our trading revenue.

With a strong network and an in-depth understanding of each of our existing customers, we also regularly reach out to them to understand their current and expected demand for the products in which we trade in. Where any potential opportunities are identified, our traders will also reach out to our customers to determine if they may require our services, for instance, where prices are expected to increase considerably or when demand for the products is expected to rise, to advise our customers to consider placing orders for future deliveries at a current fixed price. We are also able to provide consulting services to some of our customers by leveraging our experience and understanding of the oil industry, through which we will recommend to them optimal trading strategies tailored to their specific needs in relation to quantity, timing and price.

After entering into purchase and sales contracts, our finance team regularly monitors our trading exposure and positions, and will undertake steps to mitigate any accompanying risks. We have stringent hedging practices and will generally enter only into swap agreements, or trade in derivatives of the oil and oil-based products we sell on derivative exchanges, to the extent required to hedge our positions. Our finance team comprises derivative traders who have the requisite experience to conduct such trading to effectively hedge our positions.

Our pricing and credit policy

Depending on their individual needs and taking into consideration market trends, our customers may enter into either fixed price contracts or contracts where the price of the product is dependent on a formula, typically pegged to the prevailing market price at time of delivery. Occasionally, we may have “oil price trigger” and “oil price roll-over” clauses in our contracts with our customers, where we grant our customers the option to convert the formula price into a fixed price within a stipulated period, depending on the prevailing market price at the time of conversion. In such event, we will, to the extent possible, secure the same clause from our suppliers, or undertake hedging activities to hedge against any risk posed by such clauses.

We also provide our customers with advice on choosing between such pricing models, based on our experience and understanding of the market and our ability to anticipate potential price movements. Where possible, we will enter into back-to-back agreements with our customers and suppliers, and the price we charge our customers is based on a cost-plus approach by adding a mark-up to our cost of purchase. In calculating the mark-up, we will consider factors such as our cost of purchase, quantity of product, delivery timelines, credit terms and our business relationship with the customer. Other factors that we take into consideration include where we have purchased the relevant products ahead of time with the intention of taking advantage of arbitrage windows and opportunities.

Our financing capabilities allow for the execution of trades across different time zones and periods, and importantly, they also allow us to extend credit terms to our customers while satisfying the immediate payment terms required by our suppliers. While we typically settle full payment of our purchase orders with our suppliers immediately upon confirmation of the order, we generally grant our customers credit terms of up to 90 days, depending on our credit assessment of the customer and our relationship with such customer.

Customer acceptance procedures in relation to credit worthiness are performed on all of our customers at the time of onboarding. This includes, but is not limited to, (i) setting up of credit assessment and control policy and procedures; and (ii) where the customer is an existing customer, checking our internal records for the payment history of the customer. Following the onboarding of our customers, we will also conduct continuous regular assessments on all our customers. Material overdue payments are monitored continuously and evaluated on a case-by-case basis. In such event, we will take the appropriate follow-up actions, having regard to the customer’s normal payment processing procedures, our relationship with the customer, its financial position as well as the general economic environment. This includes, but is not limited to, actively liaising with the customer, and, if necessary, taking legal action against the customer to recover payments due. We will review the recoverable amount of each individual receivable balance at the end of each reporting period to ensure adequate impairment losses are provided for the irrecoverable amounts.

Sales and marketing

We believe that our reputation, our proven track record in the industry, our well-established relationships with our existing customers, along with our years of experience in the trading of oil and oil-based products enable us to leverage our existing customer base for further expansion. As such, we do not rely heavily on marketing and promotional activities. All our traders are responsible for liaising and maintaining our relationship with our customers and suppliers, and keeping abreast of market developments and potential business opportunities. They are also well equipped to identify any arbitrage windows to maximize our revenue. We focus on maintaining the quality of our services, enriching our experience and expertise in the industry, upholding our professional reputation, and maintaining our relationships within the industry, instead of relying on significant advertising and promotion. We currently have a team of 5 traders responsible for sales and marketing, led by our CEO and overseen by our risk management committee.

Quality Management

We believe that quality control is important to our business, and we have quality control measures in place to ensure that our products consistently meet the standards that our customers demand of us. Where our goods are delivered by cargo, during the unloading or discharging process, we will typically require one of our employees to monitor the unloading operations and, together with an independent surveyor, take spot samples to ensure stable product quality of our products sold. We monitor customer feedback and ensure that any new supplier whom we deal with has been approved by our risk management committee. Please also refer to the section above on “Our customer and suppliers” for more information.

Information Technology

We consider information technology development aimed at improving systems, processes and security to be of importance, and we invest in information technology systems and process improvements from time to time. We also subscribe to online publications to ensure that our traders are kept up to date with industry news and trends, as well as to obtain current information from independent reports. We are mindful of the need to progressively replace legacy applications with better-integrated systems in the areas of commodity trading and risk management. Our aim is to implement systems which allow for better monitoring of processes and increased efficiency. We currently run a number of programs, including accounts-related software as well as trading-related software, namely the WebICE system and Oilchem networks.

Environment, Health and Safety

As our operations solely involves trading, we are not exposed to significant environment, health and safety risks.

Brands and Intellectual Property

We are not materially dependent on any brand or intellectual property. Save as set out below, as at the date of this annual report, we have not registered for any intellectual property in any country. We have registered the following marks in Singapore:

Trademark		Class				Application Date
			36,39			15 May 2024
DELIXY			36,39			15 May 2024

Note:

The goods and/or services under Class 36 comprises trading in futures; providing information relating to the trading of commodity futures; options trading; trading in contracts on stocks; trading in bonds; trading of options; trading of securities; trading in shares; agencies for trading of securities; agencies for commodity futures trading; commodities trading (financial); brokerage of commodities; financial analysis and consultancy; commodities financing; commodities insurance; commodities, gold, mercantile, monetary and security exchanges; commodities investment consultancy; insurance services relating to sea freight; valuation of freight and cargo.

The goods and/or services under Class 39 comprises oil distribution services; air freight shipping services; air freight transportation; arranging for the transport of air freight; freight (shipping of goods); freight and transport brokerage services; freight brokerage and providing information relating thereto; freight ship transport; freight shipping; freight transportation by sea; freight transportation by land; freight warehousing services; freight transportation services; goods warehousing; loading, packing, storage, transport and unloading of freight; services for freight forwarding; storage; storage and delivery of goods; storage consultancy services; storage services for freight; supply chain logistics and reverse logistics services consisting of the storage, transportation and delivery of freight; supply chain logistics and reverse logistics services consisting of the storage, transportation and delivery of freight for others; tracking of freight vehicles by computer or via global positioning systems; warehousing of freight; advisory services relating to the storage of goods; arrangement of the storage of goods; oil storage services; rental of containers for warehousing and storage; storage of petro-chemicals; transmission of oil or gas through pipelines; transport of crude oil; transport of oil.

As of the date of this annual report, we have registered our domain name, “delixy.com”.

Employees

We employed 11 people as of the date of this annual report, 11 people as of December 31, 2025, 11 people as of December 31, 2024 and 11 people as of December 31, 2023, all of whom are based out of Singapore. As of December 31, 2025, while most of our employees undertake multiple roles in our Group’s operations, based on their core functions, our employees generally comprise three management personnel, five trading personnel, four logistics personnel and two administrative personnel.

We have developed various methods to ensure that employees are adequately and correctly trained for the functions they perform and are aware of the relevant legislations affecting our business. Our success depends on our ability to attract, retain, and motivate qualified employees. We believe that we maintain a good working relationship with our employees, and we have not experienced any material labor disputes or work stoppages. No collective bargaining agreement has been put in place.

We enter into standard labor contracts which contain standard confidentiality clauses with our employees.

Seasonality

We may experience an increase in demand for crude oil and oil-based products during the winter seasons. This is caused by a general increase in demand for heating during the winter seasons. We are able to leverage on our experience to monitor such trends and identify arbitrage windows to take advantage of such increase in demand.

Real Property

Our headquarters are located in Singapore. We are an asset light business and we do not own any real property. We are renting the office space that we currently use for our headquarters and day-to-day operations.

A description of the leased office space in Singapore is as follows:

Licenses, Permits and Registrations

To the best of our knowledge, no environmental licenses are required for us to operate our business in Singapore.

Insurance

We have limited liability insurance coverage for our business operations, including cargo insurance for our trades where we purchase our goods from our suppliers on “free on board” terms and sell them to our customers on “cost, insurance and freight” terms where we covers costs, insurance and freight for of our account customer’s order while the cargo is in transit. We believe that our insurance coverage is consistent with industry standards and is adequate to cover our key assets, facilities and liabilities. Please see “Risk Factors - Our current insurance coverage may not sufficiently protect us against all the risks we are exposed to and this may adversely affect our business, results of operations and financial condition”.

Legal Proceedings

We may from time to time be subject to various legal or administrative claims and proceedings arising from the ordinary course of business, including contractual disputes and other commercial disputes. Litigation or any other legal or administrative proceeding, regardless of the outcome, is likely to result in substantial cost and diversion of our resources, including our management’s time and attention. We may also need to pay damages to settle claims with a substantial amount of cash. Please see “Risk Factors - Our susceptibility to litigation, arbitration and other proceedings could have an adverse effect on our business”.

As at the date of this annual report and for the financial years ended December 31, 2024 and 2025, we have not been engaged in any legal proceedings.

Regulatory Environment

Delixy is incorporated and carries on its business in Singapore, we are subject to all relevant laws and regulations of Singapore and may be affected by new laws, regulations and policies which are introduced by the Singapore government from time to time. We have identified the main laws and regulations (apart from those pertaining to general business requirements) that we anticipate are relevant to our operations, the relevant regulatory bodies and the licenses, permits and approvals typically required for the conduct of our business in Singapore. There are no material effects of the regulations discussed under this section on our business.

The following description is a summary of material laws and regulations applicable to our operations in Singapore. The laws and regulations set out below are not exhaustive and are only intended to provide general information to investors and are neither designed nor intended to be a substitute for professional advice. Prospective investors should consult their own advisers regarding the implication of the relevant laws and regulations on us.

Regulation on Commodity Trading

The Commodity Trading Act 1992 of Singapore (“CTA”) regulates certain types of commodity trading activities, including commodity brokers and spot commodity trading. Section 2 of the CTA provides a wide definition of “commodity”. In general, commodities include any produce, item, goods or article (i.e. oil, gas and chemicals) that is the subject of any commodity forward contract, leveraged commodity trading, contract made pursuant to trading in differences, or spot commodity trading. The CTA is regulated by the Monetary Authority of Singapore.

Spot Commodity Trading License

Under Section 13A, all persons involved in spot commodity trading require a license, this includes a “spot commodity broker”, a “spot commodity broker’s representative”, a “spot commodity pool operator” and “spot commodity pool operator’s representative”.

However, a person may be exempted from spot commodity licensing if any exemptions under the CTA Schedule apply. The exemptions are as set out below:

Under Section 13A(3)(a), the penalty for a person acting as or holding himself out as a “spot commodity broker” or “spot commodity pool operator” without the necessary license is a fine not exceeding S$100,000 or imprisonment for a term not exceeding 3 years or both. Under Section 13A(3)(b), the penalty for a person acting as or holding himself out as a “spot commodity broker’s representative” or “spot commodity pool operator’s representative” without the necessary license is a fine not exceeding S$50,000 or imprisonment for a term not exceeding 12 months or both.

Part 7 of the CTA prohibits false trading, bucketing, dissemination of information about false trading, manipulation of price and cornering, employment of fraudulent or deceptive devices and fraudulently inducing trading. The prohibitions are elaborated upon below:

We must comply with Part 7 of the CTA and we ensure that all our employees are aware of such restrictions on an ongoing basis. Our management team also monitors the trades that we carry out. Pursuant to section 49 of the CTA, a person who contravenes any of the provisions of Part 7 of the CTA shall be guilty of an offence and shall be liable on conviction, in the case of an individual, to a fine not exceeding $250,000 or to imprisonment for a term not exceeding 7 years or to both, and in the case of a body corporate, to a fine not exceeding $500,000.

The Company is exempted from the requirement to hold a spot commodity license in pursuant to Sections 14A(1) of the CTA since it carries out the trading for their own account and does not solicit any funds from any member of the public.

Securities and Futures Act 2001

The Securities and Futures Act 2001 (“SFA”) governs the regulation of activities and institutions in the securities and derivatives industry. The SFA and its regulations are regulated by the Monetary Authority of Singapore.

Under the Section 2 of the SFA, a “commodity” is defined as:

but does not include -

Under Section 2 of the SFA, a “futures contract” is an exchange-traded derivatives contract under which:

Under Section 2 of the SFA, a “derivative contract” means:

but does not include -

Part 12 of the SFA governs acts occurring both within and outside Singapore, in relation to derivatives contracts, traded in Singapore. The jurisdiction conferred by SFA also extends to acts occurring within Singapore, in relation to derivatives contracts traded outside Singapore. Accordingly, we have to comply with Part 12 of the SFA. We ensure that all our employees are aware of such restrictions on an ongoing basis. Our management team also monitors the trades that we carry out.

Similar to Part 7 of the CTA, Part 12 of the SFA prohibits false trading, bucketing, dissemination of information about false trading, manipulation of price and cornering, employment of fraudulent or deceptive devices and fraudulently inducing trading. The prohibitions are elaborated upon below:

Under Section 204, a person who contravenes any of the provisions of Part 12 Division 1 of the SFA shall be guilty of an offence and shall be liable on conviction, in the case of an individual, to a fine not exceeding $250,000 or to imprisonment for a term not exceeding 7 years or to both.

Securities and Futures (Reporting of Derivatives Contracts) Regulations 2013

Securities and Futures (Reporting of Derivatives Contracts) Regulations 2013 (“SF(RDC)R”) sets out the regulations governing the reporting requirements for over-the-counter (“OTC”) counterparties and OTC derivatives.

Under Section 2 of the SF(RDC)R, “commodity derivatives contract” means a derivatives contract the value of which is determined (whether directly or indirectly, or whether wholly or in part) by reference to, is derived from, or varies by reference to, either of the following:

In pursuant to Section 5(d) of the SF(RDC)R, a “commodity derivatives contract” is a “specified derivatives contract” specified under Section 124 of the SFA and “specified persons” are subject to reporting requirements.

Under Section 6 of the SF(RDC)R, a person is a “specified person” if all of the following requirements on the last day of any quarter is satisfied:

Under Section 125 of the SFA read with Section 7 of the SF(RDC)R, every specified person who is a party to a specified derivatives contract must commence reporting of:

from and including the date specified against that information in the fourth column of that Schedule.

For example, for commodity derivatives contracts booked or traded in Singapore, information in relation to that mentioned in Parts I, IA and VI of the First Schedule will have to be reported from 1 October 2021.This includes contract information, counterparty information, clearing, transactional data and more.

We do not fall under the definition of a “specified person” and accordingly are not required to report the information set out above as the aggregate gross notional amount of the specified derivative contracts to which Delixy is a party and which are booked or traded in Singapore, for the year ending on the last day of any quarter does not exceed the reporting threshold amount. Accordingly, unless we fall under the definition of a “specified person” if the aggregate gross notional amount of specified derivative contracts to which Delixy is a party and which are booked or traded in Singapore increases, these regulations do not have a material effect on our business.

Regulation on Employment

The Employment Act 1968

The Employment Act 1968 of Singapore (the “Employment Act”) is administered by the Ministry of Manpower of Singapore and sets out the basic terms and conditions of employment and the rights and responsibilities of employers as well as employees. It generally extends to all local and foreign employees under a contract of service with an employer, except seafarers, domestic workers, statutory board employees or civil servants. Accordingly, Delixy is required to comply with the Employment Act. The Employment Act prescribes certain minimum conditions of service that employers are required to provide to their employees, including (i) minimum days of statutory annual and sick leave; (ii) paid public holidays; (iii) statutory protection against wrongful dismissal; (iv) provision of key employment terms in writing; and (v) statutory maternity leave and childcare leave benefits. In addition, certain statutory protections prescribed under Part IV of the Employment Act relating to overtime and hours of work only apply to limited categories of employees, such as workmen who receive a monthly salary of up to S$4,500 and employees (other than a workman or a person employed in a managerial or an executive position) who receives a monthly salary of up to S$2,600 (excluding any other payment, supplement or allowance.

Employment of Foreign Manpower Act 1990

The Employment of Foreign Manpower Act 1990 provides that no person shall employ a foreign employee unless the foreign employee has a valid work pass. Work passes are issued by the Ministry of Manpower and the number of work passes that can be issued is subject to each sector’s dependency ratio ceiling. The employer also must pay a monthly levy for work pass holders to the Ministry of Manpower. To the extent Delixy employs any foreign employees, Delixy has to comply with the Employment of Foreign Manpower Act 1990. Delixy will apply for work passes and pay the applicable monthly levy for any foreign employees it employs and monitor the number of foreign employee it employs on an ongoing basis to ensure that the dependency ratio ceiling is not exceeded.

The Central Provident Fund Act 1953

Aside from minimum benefits in respect of the aforementioned terms of employment in the Employment Act, employees in Singapore are entitled to contributions to the central provident fund by the employer as prescribed under the Central Provident Fund Act 1953 of Singapore (the “CPF Act”). The CPF Act is administered by the Central Provident Fund Board and governs the contributions made by employers and employees to the Central Provident Fund. The specific contribution rate to be made by employers varies depending on whether the employee is a Singapore citizen or permanent resident in the private or public sector and the age group and wage band of the employee. Generally, for employees who are Singapore citizens in the private sector or non-pensionable employees in the public sector, aged 55 years old or below and who earn more than or equal to S$750 a month, the employer’s contribution rate is 17% of the employee’s wage and the employee’s contribution rate is 20% of the employee’s wage. Delixy is required to comply with the employer’s obligations under the CPF Act for all employees it employs that are Singapore citizens or permanent residents by ensuring that the required employer’s contribution is made every month and deducting the relevant amount from each employee’s wage for contribution to the central provident fund.

Regulations on the Safety and Health of Employees

The Workplace Safety and Health Act 2006 of Singapore (the “WSH Act”) is the principal legislation governing the safety, health and welfare of persons at work in all workplaces. Delixy is required to comply with the WSH Act in respect of all its employees and persons at work in its workplaces. Among other things, the WSH Act imposes a duty on every employer and every principal to take, so far as is reasonably practicable, such measures as are necessary to ensure the safety and health of its employees, and any contractor, any direct or indirect subcontractor, and any employee employed by such contractor or subcontractor, when at work. These measures include, among other things, developing and implementing procedures for dealing with emergencies that may arise while the employees are at work and ensuring that the employee at work has adequate instruction, information, training and supervision as is necessary for that employee to perform his work. More specific duties imposed by the Ministry of Manpower on employers are laid out in the Workplace Safety and Health (General Provisions) Regulations. Some of these duties include, among other things, preventing the workplace from being overcrowded and ensuring adequate ventilation of the workplace. Given the main business of Delixy is in trading, Delixy is of the view that it has implemented sufficient measures in its workplace of an office space to ensure the safety and health of its employees.

Regulations on Intellectual Property Rights

The Company has applied to register its trademarks in Singapore. Accordingly, the Trade Marks Act 1998 would apply to such trademarks. The Intellectual Property Office of Singapore is the national authority that registers and is responsible for the administration of IP rights in Singapore, which includes copyrights, trademarks and patents. Singapore is a member of the main international conventions regulating intellectual property matters, and the World Trade Organization’s Agreement on Trade Related Aspects of Intellectual Property Rights.

Trademarks

Singapore operates a first-to-file system in respect of registered trademarks under the Trade Marks Act 1998 of Singapore, and the registered proprietor is granted a statutory monopoly of the trademark in Singapore in relation to the product or service for which it is registered. The proprietor of a registered trademark may also authorize other persons to use the trademark in relation to the goods or services for which it is registered. In all legal proceedings relating to a registered trademark or any right thereunder, the registration of a person as proprietor of a registered trademark is prima facie evidence of the validity of the original registration in any subsequent assignment or other transmission of the registration. In the event of any trademark infringement, the registered proprietor will be able to rely on the registered trademark as proof of his right to the mark, and the infringement of a trademark may give rise to civil and criminal liabilities. Goods and services are classified, for the purposes of the registration of trademarks, according to a prescribed system of classification. Statutory protection of a registered trademark can last indefinitely, as long as the registration is renewed every 10 years. Unregistered trademarks are also protected under the common law of passing off, provided that the owner is able to prove that there is goodwill or reputation in the mark, misrepresentation on the part of the infringer and damage to the mark as a result.

4.C. Organizational Structure

We are an exempted company incorporated in the Cayman Islands on May 16, 2024. Our operations are conducted through Delixy Energy Pte. Ltd., a company incorporated in Singapore, which is our wholly-owned operating subsidiary. A summary organizational chart showing our corporate structure is set out under “4.A. History and Development of the Company — Corporate Structure” above.

4.D. Property, Plants and Equipment

Brands and Intellectual Property

We are not materially dependent on any brand or intellectual property. Save as set out below, as at the date of this annual report, we have not registered for any intellectual property in any country. We have registered the following marks in Singapore:

Trademark		Class				Application Date
			36,39			15 May 2024
DELIXY			36,39			15 May 2024

Note:

The goods and/or services under Class 36 comprises trading in futures; providing information relating to the trading of commodity futures; options trading; trading in contracts on stocks; trading in bonds; trading of options; trading of securities; trading in shares; agencies for trading of securities; agencies for commodity futures trading; commodities trading (financial); brokerage of commodities; financial analysis and consultancy; commodities financing; commodities insurance; commodities, gold, mercantile, monetary and security exchanges; commodities investment consultancy; insurance services relating to sea freight; valuation of freight and cargo.

The goods and/or services under Class 39 comprises oil distribution services; air freight shipping services; air freight transportation; arranging for the transport of air freight; freight (shipping of goods); freight and transport brokerage services; freight brokerage and providing information relating thereto; freight ship transport; freight shipping; freight transportation by sea; freight transportation by land; freight warehousing services; freight transportation services; goods warehousing; loading, packing, storage, transport and unloading of freight; services for freight forwarding; storage; storage and delivery of goods; storage consultancy services; storage services for freight; supply chain logistics and reverse logistics services consisting of the storage, transportation and delivery of freight; supply chain logistics and reverse logistics services consisting of the storage, transportation and delivery of freight for others; tracking of freight vehicles by computer or via global positioning systems; warehousing of freight; advisory services relating to the storage of goods; arrangement of the storage of goods; oil storage services; rental of containers for warehousing and storage; storage of petro-chemicals; transmission of oil or gas through pipelines; transport of crude oil; transport of oil.

As of the date of this annual report, we have registered our domain name, “delixy.com”.

Leased Property

Our headquarters are located in Singapore. We are an asset light business and we do not own any real property. We are renting the office space that we currently use for our headquarters and day-to-day operations.

A description of the leased office space in Singapore is as follows:

Item 4A. Unresolved Staff Comments

None.

Item 5. Operating and Financial Review and Prospects

5.A. Operating Results

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this annual report. This discussion and analysis and other parts of this annual report contain forward-looking statements based upon current beliefs, plans and expectations that involve risks, uncertainties and assumptions. Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of several factors, including those set forth under “Risk Factors” and elsewhere in this annual report. You should carefully read the “Risk Factors” section of this annual report to gain an understanding of the important factors that could cause actual results to differ materially from our forward-looking statements.

Overview

We are principally engaged in the trading of oil related products, which can be broadly categorized into (i) crude oil and (ii) oil-based products such as fuel oils, motor gasoline, additives, gas condensate, base oils, asphalt, petrochemicals and naphtha (heavy gasoline).

We trade our products across multiple countries in Southeast Asia, East Asia and the Middle East, and we have established a presence in the oil trading markets in these countries. For the financial years ended December 31, 2024 and 2025, our total trading volume increase by 13.9% from 3,838 kBBLs (where 1 kBBL is equal to 1,000 barrels of oil) to 4,373 kBBLs, respectively. For the financial years ended December 31, 2024 and 2025, our total trading revenue decreased by 2.3% from US$314,916,000 to US$307,747,000 respectively.

Crude oil trading represents a core aspect of our business as it accounts for a significant portion of our revenue. For the financial years ended December 31, 2024 and 2025, trading in crude oil represented 53.8% and 59.3% of our total trading revenue, respectively. The trading in various oil-based products make up the rest of our total trading revenue and for the financial years ended December 31, 2024 and 2025, these make up 46.2% and 40.7% of our total trading revenue, respectively.

We typically enter into back-to-back agreements with our suppliers after our customer has agreed on the terms of the purchase so as to reduce our exposure and trading risks. We may also enter into swap agreements or trade in oil and oil-based products derivatives to further hedge our positions.

We leverage on our strong existing relationships with our customers and suppliers as well as our deep experience and understanding of the oil industry to provide certain value-added services to our customers. This includes recommending to our customers optimal trading strategies tailored to their specific needs, and providing shipping and logistical support where required. In addition, our financing capabilities allow us to extend credit terms to our customers while satisfying the immediate payment terms required by our suppliers.

KEY FACTORS AFFECTING THE RESULTS OF OUR GROUP’S OPERATIONS

We believe our financial condition and results of operations have been and will continue to be affected by a number of factors, many of which may be beyond our control, including those factors set out in the section headed “Risk Factors” in this annual report and those set out below:

Our business operations are governed by various laws, regulations and government policies in Singapore. These laws and regulations may change from time to time. We may be unable to comply with all these requirements in time or at all or we may need to incur substantial costs to be compliant, which may adversely affect our business operations and financial condition.

Our business is driven by crude oil prices, which are affected by both domestic and global supply and demand factors. A prolonged economic slowdown, a global recession, adverse events relating to the energy industry and local, regional and national economic conditions and factors could negatively impact our operations and therefore adversely affect our business, financial condition and results of operations.

The risks associated with our business are more acute during periods of economic slowdown or recession because such periods may lead to greater fluctuations in crude oil prices and/or decreased demand for crude oil and oil-based products.

We compete with various international and local service providers. Competition may result in pricing pressures, declining revenue and profitability, or a loss of market share. We face competitors who may have strong competitive advantages, including longer operating histories, larger and broader customer bases, lower operating costs, more established relationships with a broader set of suppliers and customers, greater brand recognition, and greater financial, research and development, marketing, distribution, and other resources than us. In addition, new companies may enter the market with innovative business models or more appealing service offerings and disrupt the competitive landscape, making it even more challenging for us to maintain our market position. There is no guarantee that our strategies will remain competitive or successful in the future. Increased competition may result in pricing pressures and loss of our market share, which could have a material adverse effect on our business, financial condition and results of operations.

If our customers’ requirements change or if the demand for crude oil declines for any reason, including due to any fuel conservation measures, alternative fuel requirements, increasing consumer demand for alternatives to oil and natural gas, technological advances in fuel economy and energy generation devices, there may be a potential loss in revenue which would adversely affect our profitability.

We may use hedging strategies to cover any outstanding positions we may hold from time to time. These strategies may be unsuccessful because there may be an imperfect correlation, or no correlation, between the price movements of the hedging instrument and the price movements of the trade being hedged. We are subject to the risk that our counterparty will default on its obligation to pay us, as well as the risk that we will not be able to meet our obligations to pay the other party to the agreement. Swap agreements may also involve the risk that there is an imperfect correlation between the return on our obligation to the counterparty and the return on the referenced asset. In addition, swap agreements are subject to market and illiquidity risk, leverage risk and hedging risk. The value of swaps, like many other derivatives, may move in unexpected ways and may result in losses for us. There can be no assurance that our hedging transactions (including by way of swap arrangements) will be effective. The use of hedging may also result in certain adverse tax consequences, and may also reduce our potential for profit.

The outbreaks of diseases or pandemics could result in, among other things, operational disruptions, the lack of an adequate workforce in parts of or all of our operations and communications and transportation disruptions. This in turn could lead to decreased consumer confidence and spending, and increased volatility in Singapore, the United States and the global financial markets and economy. As a result, our business operations and financial performance may be adversely affected.

Regular monitoring, strategic adaptation, and proactive management of these factors are crucial to maintaining the resilience and success of our group’s operations.

Results of Operations

Comparison of Results of Operations for the Financial Years Ended December 31, 2024 and 2025

Revenue

Total revenue decreased by approximately US$7,169,000 or 2.3% from approximately US$314,916,000 for the financial year ended December 31, 2024 to approximately US$307,747,000 for the financial year ended December 31, 2025.

The increase in revenues derived from the sale of crude oil was due to more volume of crude oil been sold in the financial year ended December 31, 2025 compared to the financial year ended December 31, 2024, even though average of crude oil price is lower followed world crude oil price trend.

The decrease in revenue for the financial year ended December 31, 2025, was primarily driven by lower market prices for fuel oil compared to the previous year. This price decline led to a contraction in fuel oil trading volumes. Additionally, while we saw an increase in MTBE sales, it was insufficient to offset the overall decline in revenue. Consequently, the decrease in revenue from oil-based products is primarily attributable to the lower average selling prices realized in the financial year ended December 31, 2025 relative to the financial year ended December 31, 2024, rather than a reduction in our core trading activity.

As set forth in the following table, for the financial years ended December 31, 2024 and 2025, our revenue was derived from the following segment:

Revenue by geographical location

For the financial years ended December 31, 2024 and 2025, substantially all of our revenue was derived from customers located in Southeast Asia, East Asia and the Middle East.

For the financial years ended December 31, 2024 and 2025, the percentage of revenue derived from customers in the PRC was 54.5% and 29.2% respectively, while the percentage of products that we source from suppliers in the PRC was 22.6% and 51.6% respectively.

Cost of revenue

Our cost of revenue primarily consists of purchases of crude oil and oil-based products. For the financial years ended December 31, 2024 and 2025, our cost of revenue was US$310,618,000 and US$305,203,000 respectively.

The decrease in the cost of revenue was primarily driven by lower average procurement prices for these products during the period. While trading volumes for these products increased, the impact of lower unit costs resulted in an overall reduction in the cost of revenue. 

Gross profit and gross profit margin

Gross profit margin was approximately 1.4% and 0.8%, for both financial years ended December 31, 2024 and 2025. Our gross profit amounted to approximately US$4,298,000 and US$2,544,000, respectively, for the financial years ended December 31, 2024 and 2025.

Our gross profit decreased by approximately US$1,754,000 during the financial years ended December 31, 2024 and 2025 as a result of the lower revenues generated during the financial year ended December 31, 2025 compared to the financial year ended December 31, 2024.

General and administrative expenses

For the financial years ended December 31, 2024 and 2025, our general and administrative expenses increased by approximately US$3,485,000 or 97.0% from approximately US$3,592,000 for the financial year ended December 31, 2024 to approximately US$7,077,000 for the financial year ended December 31, 2025, each representing approximately 1.1% and 2.3% respectively of our total revenue for the respective financial years.

The following table sets forth the breakdown of our general and administrative expenses for the financial years ended December 31, 2024 and 2025, respectively, indicated:

Commission mostly comprises brokerage commissions and clearing fees associated with financial hedging instruments.

A common concept in international shipping, demurrage is a fee that must be paid when a vessel remains at a port or terminal for longer than the agreed free time period specified in a shipping contract.

Depreciation and amortization expenses are charged on our property and equipment and also right-of-use asset.

Decreased in freight and handling charges primarily due to a strategic revision of our shipping terms, which effectively mitigated our exposure to logistics-related risks and costs.

Legal and professional fees consist of audit, tax and secretarial fees. No legal fees related to any lawsuit noted.

Consulting and advisory fees relate to fees paid for the expansion of the Group’s product offerings, strengthening its market position; as well as business cooperations as per the use of proceeds from the offering.

Letter of credit charges mainly represent charges incurred on trade-related activities such as letter of credits and bill payables.

Staff costs mainly represent the salaries, employee benefits and retirement benefit costs to our employees and directors’ remuneration. Staff costs increased by approximately US$100,000, or 24.2% from approximately US$414,000 for the financial year ended December 31, 2024 to approximately US$514,000 for the financial year ended December 31, 2025. The increase was mainly attributable to the salary adjustment of the COO during this period. The cost consists of employees’ salary, bonuses & allowances, and CPF Contributions.

Interest expenses are mainly charged on new loan from shareholder with simple annual interests charged at 3.5% per annum. Effective May 1, 2025, the Company and the lending shareholder entered into an amended loan agreement. Pursuant to this amendment, the parties agreed to waive all interest obligations associated with the 3.5% interest-bearing facility for the fiscal year ended December 31, 2025. Consequently, no interest expense was recognized in the Company’s consolidated statement of operations for the year ended December 31, 2025, in relation to this facility. This arrangement was entered into to strengthen the Company’s financial position and provide necessary support for its business operations as it continues to execute its growth strategy within the corporate group.

Other expenses comprised independent director fees, insurance expenses, office supplies, repair and maintenance and other general expenses.

Other income

For the financial years ended December 31, 2024 and 2025, other income decreased by approximately US$214,000 or 51.0% from approximately US$420,000 for the financial year ended December 31, 2024 to approximately US$206,000 for the financial year ended December 31, 2025.

The following table sets forth the breakdown of total other income for the financial years ended December 31, 2024 and 2025, respectively, indicated:

Interest income

Interest income earned from bank fixed deposit. The decrease in interest income from the financial year ended December 31, 2024 to December 31, 2025 was primarily due to lesser interest income received by the Group from the placement of excess funds of the Group in fixed deposits.

The Group had placed a lesser amount in fixed deposits in the year ended December 31, 2025, compared to the year ended December 31, 2024, generating a lower interest income for the Group.

Income tax expense

Our income tax expense increase by approximately US$38,000 or 38.8% from approximately US$98,000 in the financial year ended December 31, 2025 to approximately US$136,000 for the financial year ended December 31, 2025. Our effective tax rate was 17.0%. For the financial years ended December 31, 2024 and 2025, our income tax expense comprised current tax expense.

Net income/(loss)

As a result of the foregoing, our net income amounted to approximately US$1,028,000 and net loss US$4,463,000 for the financial years ended December 31, 2024 and 2025, respectively.

5.B. Liquidity and Capital Resources

Liquidity and Capital Resources

Our liquidity and working capital requirements primarily relate to our operating expenses. Historically, we have met our working capital and other liquidity requirements through a combination of cash generated from our operations and loans from banking facilities. Going forward, we expect to fund our working capital and other liquidity requirements from various sources, including but not limited to cash generated from our operations, loans from banking facilities, the net proceeds from our initial public offering and other equity and debt financings, as and when appropriate. From time to time, in recognition of our strong financial position, certain financial institutions have been willing to extend short term credit facilities to us. We are currently party to two existing short term credit facilities with BOC and UOB respectively.

Pursuant to the terms of such credit facilities, the banks grant us lines of credit for, amongst others, (a) establishing irrevocable sight and/or usance import documentary letters of credits and/or standby letters of credit covering our purchase of crude oil and/or other petroleum products on a pre-sold basis against certain conditions including copies of purchase and sales contracts and a cash margin, (b) issuing term bills to finance bills drawn under the bank’s usance letters of credit, (c) trust receipt financing to bridge the financing gap between payment to supplier and receipt of export proceeds, and (d) freight financing in relation to our purchase of goods. These letters of credit are issued on a back to back basis, against, amongst others, one or more export letters of credit issued by banks acceptable to UOB and BOC respectively under their respective credit facilities. Accordingly, the amount under the letter of credit issued to us will be subject to the amount in the corresponding export letter of credit we provide. The facilities are uncommitted in nature and the availability of each utilization is subject to review and approval by the banks or specifically restricted to oil majors and/or national oil companies and/or producers and/or suppliers that are acceptable to the banks. The facilities are secured by, amongst others, a personal guarantee provided by Mr. Xie Dongjian, a pledge of goods in relation to the goods financed by the bank, a letter of charge and set-off, and a deed of charge and assignment for an assignment of, amongst others, all rights, interests and title under or in respect of purchase contracts and/or sales contracts pertaining to goods financed by the bank, goods financed by the bank and accounts maintained by the bank. Other terms and conditions include submitting our annual audited financial statements to the bank, complying with applicable environmental, social and governance laws and regulations, ensuring that the obligations and liabilities under the facility rank ahead of or otherwise at least pari passu in all respects with all other present and future unsecured and unsubordinated obligations and liabilities to other creditors, and not undertaking or permitting any reorganization, amalgamation, reconstruction, takeover, change of shareholders or any other schemes of compromise or arrangement affecting Delixy’s present constitution or amending or altering any provisions in Delixy’s constitution relating to Delixy’s borrowing powers and principal business activities.

Both banks charge interest based on a spread over its respective cost of funds, as well as commissions based on a percentage of the amount issued under the letters of credit. There may also be other fees such as facility fees, acceptance commission and outward remittance fees. The validity of letters of credit range from 30 days to three (3) months, while the other financing facilities such as trust receipt financing and freight financing have tenors ranging from 7 to 30 days. As of December 31, 2024 and December 31, 2025, and as of the date of this annual report, the amount outstanding with respect to these credit facilities is zero, US$2,104,000 and zero.

Cash flows

The following table summarizes our cash flows for the financial years ended December 31, 2024 and 2025:

Cash flows from operating activities

For the year ended December 31, 2024, our net cash provided by operating activities was approximately US$612,000, primarily reflecting net income of approximately US$1,028,000, as adjusted by the following:

For the year ended December 31, 2025, our net cash used in operating activities was approximately US$5,245,000, primarily reflecting net loss of approximately US$4,463,000, as adjusted by the following:

Cash flows from investing activities

For the year ended December 31, 2024, our net cash provided by investing activities was approximately US$552,000, primarily consisting of negative changes in derivative financial instruments of US$78,000; positive changes from the proceeds received from the disposal of property of US$957,000; and negative changes in amounts due from our shareholder of US$327,000.

For the year ended December 31, 2025, our net cash provided by investing activities was approximately US$160,000, primarily consisting of positive changes in derivative financial instruments of US$103,000 and positive changes in amounts due from our shareholder of US$57,000.

Cash flows from financing activities

For the year ended December 31, 2024, our net cash used in financing activities was approximately US$6,066,000 primarily consists of dividend paid of approximately US$4,745,000; and negative changes from deferred offering costs of US$1,321,000.

For the year ended December 31, 2025, our net cash provided by financing activities was approximately US$3,535,000, primarily consists of proceed of issuance of stock approximately US$4,536,000; and repayment of loan repayment of approximately US$1,000,000.

Capital Expenditures

There were no capital expenditures incurred in the financial years ended December 31, 2024 and 2025.

We plan to fund our future capital expenditures with our existing cash balance and proceeds from our initial public offering. We will continue to make capital expenditures to meet the expected growth of our business.

Working Capital

We have sufficient working capital for our requirements for at least the next 12 months from the date of this annual report, in the absence of unforeseen circumstances, considering the financial resources presently available to us, including cash and cash equivalents on hand, cash flows from our operations and the estimated net proceeds from our initial public offering.

Going Concern

As of December 31, 2025, the Company’s reported negative operating cash flow and net loss for the period warrant a comprehensive assessment of our ability to continue as a going concern. Management and the Board have evaluated our liquidity position and determined that the Company remains a going concern based on the following considerations:

Consequently, these consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. Should management be unable to execute these plans as anticipated, there could be a material adverse effect on the Company’s business.

Accounts receivable, net

Our accounts receivable, net, approximately US$17,519,000 and US$22,399,000 as of December 31, 2024 and December 31, 2025 respectively. This increase in net accounts receivable was due to the longer repayment time from customer to the company. We did not charge any interest on, or hold any collaterals as security over these accounts receivable balances. We generally offer credit periods of up to 90 days to our customers. We have not had, and do not expect to have, issues collecting payment from these longer aging invoices.

The following table sets forth the ageing analysis of our accounts receivable, net, based on the invoiced date as of the dates mentioned below:

We determine, on a continuing basis, the probable losses and an allowance for doubtful accounts, based on several factors including internal risk ratings, customer credit quality, payment history, historical bad debt/write-off experience and forecasted economic and market conditions. Accounts receivable is written off after exhaustive collection efforts occur and the receivable is deemed uncollectible. In addition, receivable balances are monitored on an ongoing basis and its exposure to bad debts is not significant.

Amount due from shareholder

Amount due from shareholder, Mega Origin, is US$152,000 and US$95,000 as of December 31, 2024 and December 31, 2025 respectively. The amount is non-trade in nature, unsecured, interest-free and recoverable on demand.

Loan from shareholder

For long-term loan, the loan quantum is US$5,000,000 with simple annual interests charged at 3.5% per annum. The loan was entered into on January 1, 2024, and is for a period of two years and not repayable upon demand, save upon the request by Delixy Energy, whichever earlier. On December 31, 2024, the loan was further extended for another year to December 31, 2026.

Effective May 1, 2025, the Company and its shareholder entered into a revised loan agreement. Following a partial repayment of US$1,000,000 on April 22, 2025, the outstanding principal balance was US$4,000,000. The shareholder irrevocably waived all interest accrued from January 1, 2025 to May 1, 2025, and the loan is non-interest-bearing thereafter.

Accrued liabilities

Our accrued liabilities were approximately US$50,000 as of December 31, 2024 and US$237,000 as of December 31, 2025.

Contractual Obligations

We had the following contractual obligations as of December 31, 2024:

We had the following contractual obligations as of December 31, 2025:

Capital commitments

As of December 31, 2024 and 2025, we did not have any capital commitments.

Off-Balance Sheet Transactions

As of December 31, 2024 and 2025, we had not entered into any material off-balance sheet transactions or arrangements.

We have not entered into any financial guarantees or other commitments to guarantee the payment obligations of any third parties. In addition, we have not entered into any derivative contracts that are indexed to our own shares and classified as shareholders’ equity, or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. Moreover, we do not have any variable interest in an unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or research and development services with us.

Taxation

Cayman Islands Tax Considerations

The Cayman Islands currently levies no taxes on individuals or corporations based upon profits, income, gains or appreciation and there is no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to us levied by the government of the Cayman Islands except for stamp duties which may be applicable on instruments executed in, or, after execution, brought within the jurisdiction of the Cayman Islands. The Cayman Islands is not party to any double tax treaties that are applicable to any payments made to or by our Company. There are no exchange control regulations or currency restrictions in the Cayman Islands.

British Virgin Islands

Our intermediate holding subsidiary, Delixy International Limited, is incorporated in the British Virgin Islands. The British Virgin Islands currently levies no taxes on individuals or corporations based upon profits, income, gains or appreciation and there is no taxation in the nature of estate duty or inheritance tax. There are no other taxes likely to be material to us levied by the government of the British Virgin Islands except for stamp duties which may be applicable on instruments executed in, or after execution brought within the jurisdiction of the British Virgin Islands. The British Virgin Islands is not party to any double tax treaties that are applicable to any payments made to or by our company. There are no exchange control regulations or currency restrictions in the British Virgin Islands. In addition, the British Virgin Islands does not impose withholding tax on dividend payments.

Singapore

Delixy Energy Pte. Ltd. is operating in Singapore and are subject to the Singapore tax law at the corporate tax rate at 17.0% on the assessable income arising in Singapore during its tax year. See “Material Tax Considerations”.

5.C. Research and Development, Patents and Licenses, etc.

Please refer to "Item 4.B. Business Overview" for a discussion of our research and development, patents and licenses.

5.D. Trend Information

Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the year ended December 31, 2025 that are reasonably likely to have a material adverse effect on our net revenues, income, profitability, liquidity, capital resources or capital expenditures, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial condition.

5.E. Critical Accounting Estimates

Critical Accounting Policies, Judgments and Estimates

Summary of significant accounting policies

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements. These financial statements are prepared in accordance with U.S. GAAP, which requires us to make estimates and assumptions that affect the reported amounts of our assets and liabilities and revenue and expenses, to disclose contingent assets and liabilities on the date of the consolidated financial statements, and to disclose the reported amounts of revenue and expenses incurred during the financial reporting period. We continue to evaluate these estimates and assumptions that we believe to be reasonable under the circumstances. We rely on these evaluations as the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Since the use of estimates is an integral component of the financial reporting process, actual results could differ from those estimates. Some of our accounting policies require higher degrees of judgment than others in their application. We believe that the critical accounting policies as disclosed in this annual report reflect the more significant judgments and estimates used in preparation of our consolidated financial statements. Further, we elected to use the extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, these financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements.

The following critical accounting policies rely upon assumptions and estimates and were used in the preparation of our consolidated financial statements:

(a) Consolidation

The consolidated financial statements include the financial statements of the Company and its subsidiaries. All inter-company transactions, if any, and balances due to, due from, long-term investment subsidiary, and registered paid in capital have been eliminated upon consolidation.

(b) Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the financial years presented.

Significant accounting estimates reflected in our consolidated financial statements in the period include the allowance for doubtful accounts on accounts and other receivables, assumptions used in assessing right-of-use assets and impairment of long-lived assets. Actual results could vary from the estimates and assumptions that were used.

Given the uncertainty regarding the length, severity, and ability to combat the COVID-19 pandemic, we cannot reasonably estimate the impact on our future results of operations, cash flows, or financial condition. As of the date of this annual report, we are not aware of any specific event or circumstance that would require us to update our estimates, our judgments, or the carrying value of our assets or liabilities. These estimates may change as new events occur and additional information is obtained and are recognized in the consolidated financial statements as soon as they become known. Actual results could differ from those estimates, and any such differences may be material to our consolidated financial statements.

(c) Accounts receivables

Accounts receivables include trade accounts due from customers in the sale of products.

Accounts receivable is recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms. The Company seeks to maintain strict control over its outstanding receivables to minimize credit risk. Overdue balances are reviewed regularly by senior management. Management reviews its receivables on a regular basis to determine if the bad debt allowance is adequate and provides allowance when necessary. The allowance is based on management’s best estimates of specific losses on individual customer exposures, as well as the historical trends of collections, the age of the accounts receivable balances, current general economic conditions, future expectations and customer specific quantitative and qualitative factors that may affect the Company’s customers’ ability to pay. Account balances are charged off against the allowance after all means of collection have been exhausted and the likelihood of collection is not probable. The Company’s management continues to evaluate the reasonableness of the valuation allowance policy and update it if necessary.

The Company does not hold any collateral or other credit enhancements overs its accounts receivable balances.

(d) Property and equipment

Property and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

Expenditure for repairs and maintenance is expensed as incurred. When assets have retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

Long-lived assets, including property and equipment with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. We assess the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, we would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. As of December 31, 2024 and 2025, no impairment of long-lived assets was recognized.

In accordance with the provisions of ASC Topic 360, Impairment or Disposal of Long-Lived Assets, all long-lived assets such as property, plant and equipment owned and held by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets.

(e) Revenue recognition

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Topic 606, “Revenue from Contracts with Customers”. This topic clarifies the principles for recognizing revenue and develops a common revenue standard for U.S. GAAP. Simultaneously, this topic supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance throughout the Industry Topics of the Codification. The core principle of the guidance requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

Revenue from goods sold and services provided

Revenue from sales of goods and services in the ordinary course of business is recognized when the Company satisfies a performance obligation (“PO”) by transferring control of a promised good or service to the customer. The amount of revenue recognized is the amount of the transaction price allocated to the satisfied PO.

The transaction price is allocated to each PO in the contract on the basis of the relative stand-alone selling prices of the promised goods or services. The individual stand-alone selling price of a good or service that has not previously been sold on a stand-alone basis, or has a highly variable selling price, is determined based on the residual portion of the transaction price after allocating the transaction price to goods and/or services with an observable stand-alone selling price. A discount or variable consideration is allocated to one or more, but not all, of the performance obligations if it relates specifically to those performance obligations.

Transaction price is the amount of consideration in the contract to which the Company expects to be entitled in exchange for transferring the promised goods or services. The transaction price may be fixed or variable and is adjusted for time value of money if the contract includes a significant financing component. Consideration payable to a customer is deducted from the transaction price if the Company does not receive a separate identifiable benefit from the customer. When consideration is variable, if applicable, the estimated amount is included in the transaction price to the extent that it is highly probable that a significant reversal of the cumulative revenue will not occur when the uncertainty associated with the variable consideration is resolved.

Revenue may be recognized at a point in time following the timing of satisfaction of the PO. Typically, POs for products and services where the process is as described below, the PO is satisfied at a point in time. For the sale of oil products, the Company typically receives purchase orders from its customers which will set forth the terms and conditions, including the transaction price, products to be delivered, terms of delivery, and terms of payment. The terms serve as the basis of the performance obligations that the Company must fulfil in order to recognize revenue. The key performance obligation is the delivery of the finished product to the customer at their location, at which point title to that asset passes to the customer. The completion of this earning process is evidenced by transport documents such as bill of lading or delivery order.

Trading of derivatives embedded in sales contracts or at the requested from the suppliers for oil products are initially recognized at fair value at the date the derivative contracts are entered into and are subsequently remeasured to their fair value as at each reporting date. The resulting gain or loss is recognized under statements of income.

(f) Income taxes

Income taxes are determined in accordance with the provisions of ASC Topic 740, Income Taxes, or ASC 740. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

The Company evaluates the uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measure the unrecognized benefits associated with the tax positions. As of December 31, 2024 and 2025, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential underpaid income tax expenses for the financial years ended December 31, 2023, 2024 and 2025 and also did not anticipate any significant increases or decreases in unrecognized tax benefits in the next 12 months from December 31, 2025.

We are subject to tax in local and foreign jurisdiction. As a result of our business activities, we file tax returns that are subject to examination by the relevant tax authorities.

(g) Leases

Effective from January 1, 2020, we adopted the guidance of ASC 842, Leases, which requires an entity to recognize a right-of-use asset and a lease liability for virtually all leases. On February 25, 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update No. 2016-02, Leases (Topic 842), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing transactions. ASC 842 requires that lessees recognize right-of-use assets and lease liabilities calculated based on the present value of lease payments for all lease agreements with terms that are greater than twelve months. It requires for leases longer than one year, a lessee to recognize in the statement of financial condition a right-of-use asset, representing the right to use the underlying asset for the lease term, and a lease liability, representing the liability to make lease payments. ASC 842 distinguishes leases as either a finance lease or an operating lease that affects how the leases are measured and presented in the statement of operations and statement of cash flows. ASC 842 supersedes nearly all existing lease accounting guidance under GAAP issued by the FASB including ASC Topic 840, Leases.

The accounting update also requires that for finance leases, a lessee recognize interest expense on the lease liability, separately from the amortization of the right-of-use asset in the statements of earnings, while for operating leases, such amounts should be recognized as a combined expense. In addition, this accounting update requires expanded disclosures about the nature and terms of lease agreements.

(h) Related parties

We follow the ASC 850-10, Related Party for the identification of related parties and disclosure of related party transactions.

(i) Fair value measurement

We follow the guidance of the ASC Topic 820-10, Fair Value Measurement and Disclosure, or ASC 820-10, with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

The carrying value of our financial instruments: cash and cash equivalents, accounts receivable, deposits and other receivables, amount due from shareholder, accounts payable and accrued liabilities, other payables, lease liabilities and hedging contracts approximate at their fair values because of the short-term nature of these financial instruments.

Management believes, based on the current market prices or interest rates for similar debt instruments, the fair value of note payable approximate the carrying amount. We account for loans receivable at cost, subject to impairment testing. We obtain a third-party valuation based upon loan level data including note rate, type and term of the underlying loans.

Our non-marketable equity securities are investments in privately held companies, which are without readily determinable market values and are classified as Level 3, due to the absence of quoted market prices, the inherent lack of liquidity and the fact that inputs used to measure fair value are unobservable and require management’s judgment. Financial instruments are fair value financial assets that are marked to fair value and are accounted for as under Level 3 under the above hierarchy except for derivative instruments that are marked to fair value and are accounted for as under Level 2.

Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Recent Accounting Pronouncements

The Company has evaluated all the recently issued, but not yet effective, accounting standards that have been issued or proposed by the FASB or other standards-setting bodies through the date of this report and do not believe the future adoption of any such standards will have a material impact on the Company’s consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, and in January 2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Both early adoption and retrospective application are permitted. The Company is currently evaluating the impact that the adoption of these standards will have on its consolidated financial statements.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provide all entities with a practical expedient and entities other than public business entities with an accounting policy election when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. The amendments will be effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.

ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities. In December 2025, the FASB issued this ASU to establish authoritative guidance on the accounting for government grants received by business entities. This update is effective beginning with the Company’s 2029 fiscal year annual reporting period, with early adoption permitted. The Company is currently assessing the impact this standard will have on the Company’s consolidated financial statements.

Other accounting standards that have been issued by the FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent standards that are not anticipated to have an impact on or are unrelated to its consolidated financial condition, results of operations, cash flows or disclosures.

Except as mentioned above, we do not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on our consolidated balance sheets, statements of income and comprehensive income/(loss) and statements of cash flows.

Impact of Inflation

In accordance with the Monetary Authority of Singapore, the year-over-year percentage changes in the consumer price index for 2024 and 2025 were 2.8% and 0.7%, respectively. As of the date of this annual report, inflation in Singapore has not materially affected our profitability and operating results. While recent inflationary pressures have led to such increase in costs and impacted our operations, we have been able to mitigate this impact due to our strong market position and pricing power, which has allowed us to pass these costs on to our customers through back-to-back agreements. As a result, our profitability and operating results have not been impacted by recent inflationary pressures. However, we can provide no assurance that we will not be affected by such inflationary pressures in Singapore or globally in the future. In the event that the inflationary pressures continue to increase to any material extent, and we continue to pass along the increased costs to our customers, it may result in loss of sales and loss of customers, thereby adversely impacting our margins and results of operations.

Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

As the Company has no significant interest-bearing assets, the Company’s income and operating cash flows are substantially independent of changes in market interest rates.

The Company’s interest-rate risk arises from lease liabilities. The Company manages interest rate risk by varying the issuance and maturity dates of variable rate debt, limiting the amount of variable rate debt, and continually monitoring the effects of market changes in interest rates. As of December 31, 2024 and 2025, the lease liabilities were at fixed interest rates.

Credit Risk

Credit risk is controlled by the application of credit approvals, limits and monitoring procedures. We manage credit risk through in-house research and analysis of the relevant economy and the underlying obligors and transaction structures. We identify credit risk collectively based on industry, geography and customer type. In measuring the credit risk of our sales to our customers, we mainly reflect the “probability of default” by the customer on its contractual obligations and consider the current financial position of the customer and the current and likely future exposures to the customer.

Liquidity Risk

We are also exposed to liquidity risk, which is a risk that we will be unable to provide sufficient capital resources and liquidity to meet our commitments and business needs. Liquidity risk is controlled by the application of financial position analysis and monitoring procedures. When necessary, we will turn to financial institutions and related parties to obtain short-term funding to cover any liquidity shortage.

Foreign Exchange Risk

Our reporting currency is the United States dollars, and almost all of our consolidated revenues and consolidated costs and expenses are in United States dollars.

Internal Control Over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Under the supervision and with the participation of management, including the Chief Executive Officer and Financial Controller, the Company conducted an evaluation of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025 using its internal standard operating procedures (“SOP”).

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of internal control over financial reporting as of December 31, 2025, the Company determined that there were no control deficiencies that constituted material weaknesses.

Item 6. Directors, Senior Management and Employees

6.A. Directors and Senior Management

Set forth below is information concerning our Directors, Director appointees, and Executive Officers.

No arrangement or understanding exists between any such Director or Executive Officer and any other persons pursuant to which any Director or Executive Officer was elected as a Director or Executive Officer. Our Directors are elected annually and serve until their successors take office or until their death, resignation or removal. The Executive Officers serve at the pleasure of our Board.

The following is a brief biography of each of our Executive Directors and Executive Officers, key personnel, and director appointees:

Executive Directors and Executive Officers

Mr. Xie, Dongjian

Mr. Xie Dongjian (“Mr. Xie”), aged 58, is our Executive Chairman, Chief Executive Officer and Executive Director. Mr. Xie is responsible for overseeing all aspects of our Group’s operations, strategic planning and formulation of corporate strategies. Mr. Xie was appointed as a director of Delixy Energy Pte. Ltd. on September 10, 2007, and as the chief executive officer on June 22, 2020. Since the incorporation of our Company, Mr. Xie has been our Executive Chairman, Chief Executive Officer and Executive Director. He is currently a director of all the subsidiaries of our Group.

Mr. Xie has over 30 years of experience in the energy market. He began his career as a trader in crude oil trading and processing in Sinochem Head office (Beijing) in 1990. 4 years thereafter, in 1994, he was promoted to department manager in crude and product trading at Sinochem America Holdings & Sinochem International Oil (Bahamas). In 1998, he transferred back to Sinochem Head Office (Beijing) and continued working as department manager in crude & feedstocks trading. In 2000, he was reassigned to Sinochem Japan to work as the department manager in crude & product trading. Prior to joining our Group in September 2007, Mr. Xie was working as the section chief at Nissho Iwai Corporation (or otherwise known as Sojitz Corporation), a listed company on the Tokyo Stock Exchange between 2002 to 2007.

Mr. Xie completed his bachelor’s degree in international business at the University of International Business & Economics in Beijing in 1990.

Ms. Yen Chong Yin Lai

Ms. Yen Chong Yin Lai (“Ms. Chong”), aged 42, is our Chief Financial Officer. Ms. Chong is responsible for the overall supervision and management of the financial aspects of our Group. Ms. Chong has over 15 years of experience in accounting, financial management, and corporate finance. She most recently served as Chief Financial Officer of SBS Logistics Singapore Pte Ltd from April 2021 to May 2025, where she led regional finance operations including budgeting, forecasting, financial reporting, audit and tax compliance, risk management, and internal controls across multiple subsidiaries. Prior to that, she held progressively senior finance and accounting roles at SBS Logistics Singapore Pte Ltd and its holding company, as well as at Cargotec CHS Asia Pacific Pte Ltd. Ms. Yen holds a Bachelor of Arts with Honors in Business and Finance from Coventry University.

Ms. Yao Yuan

Ms. Yao Yuan (“Ms. Yao”), aged 44, is our Executive Director and Chief Operating Officer. Ms. Yao has been our chief operating officer since 2009, and is responsible for the overall implementation of our business strategies and operation of our Company.

Prior to joining our Group, between February 2008 to March 2009, Ms. Yao served as the trader/feedstock team leader at Dezhou Huatai Petroleum Co., Ltd. She was largely responsible for spearheading, strategizing and managing the company’s straight run fuel oil, light oil (including naphtha and kerosene), and crude oil business for its own crude distillation unit and vacuum distillation unit; as well as the trading in oil products in Shandong and in other areas within the PRC. From July 2005 to February 2008, Ms. Yao was the marketing manager in oil and petroleum trading at Beijing Yalian Jiye Petro-Chemical Co., Ltd. As the marketing manager, she was responsible for the purchase and sale of residual and fuel oil in the northern part of the PRC to maintain the balance in its supply and demand; the residual feedstock procurement for refineries in Shandong and Hebei of the PRC. From September 2003 to July 2005, Ms. Yao was an operation assistant at Beijing Jingshi Ninwei Trading Co., Ltd, whereby she was responsible for planning and managing the duel oil and middle distillates operations of the company for domestic trading; the fuel oil blending operation; the general shipping and storage operations for crude and products; and contracting administration for importing oil products.

Ms. Yao completed her bachelor’s degree in English at the Beijing Foreign Studies University in 2003.

Independent Directors

Mr. Lay Shi Wei (“Mr. Lay”) is our independent director. Mr. Lay serves as chairman of the audit committee and as a member of the compensation and nomination committees.

Mr. Lay has a background in accounting and finance. Since November 2023, Mr. Lay has served as the Vice President and a Registered Professional of Evolve Capital Advisory Private Limited (“ECA”), a boutique corporate investment bank in Singapore. ECA is a Capital Market Services license holder licensed by the Monetary Authority of Singapore (“MAS”) and a Full Sponsor approved by the Singapore Exchange. Previously from May 2017 to October 2023, he was Associate Director, Team Lead, Registered Professional at RHT Capital Pte. Ltd., a Capital Market Services license holder licensed by the MAS and a Full Sponsor approved by the Singapore Exchange. During his tenure with RHT Capital Pte. Ltd., he led his team in several successful IPOs and acted as the financial adviser in projects which involve the privatization and buyout of listed companies. From June 2016 to May 2017, Mr. Lay served as the Manager at Prime Partners Corporate Finance Pte. Ltd., a Capital Market Services license holder licensed by the MAS and a Full Sponsor approved by the Singapore Exchange, where he was involved in the IPO projects and reverse take-over. Between December 2011 to June 2016, Mr. Lay was an associate to Manager at Provenance Capital Pte. Ltd., a Capital Market Services license holder licensed by the MAS, where he advised on various capital markets transactions in Singapore. From July 2010 to December 2011, he worked as an associate at KPMG Services Pte. Ltd., a global auditing firm. From April 2024, Mr. Lay has been an Independent Director and chairman of the audit committee of China Yuanbang Property Holdings Limited, a company listed on the Mainboard of the Singapore Exchange.

Mr. Lay received his bachelor’s degree of Business Administration from National University of Singapore in 2010. He is a Chartered Accountant of Singapore.

Mr. Yap Beng Tat, Richard (“Mr. Yap”) is our independent director. Mr. Yap serves as chairman of the nomination committee and as a member of the audit and compensation committees.

Mr. Yap has more than 15 years of financial analysis experience which includes valuation of companies, intangibles, private equity & financial derivatives, financial statement analysis, business strategy analysis, financial modelling and execution of transactions. In July 2022, Mr. Yap founded Navi Corporate Advisory Pte Ltd (“NAVI”), a Singapore company that performs business valuation and advisory project for both private companies and listed companies. He has been serving as the CEO of NAVI since July 2022. Mr. Yap is also previously the independent director, chairman of the nominating committee of Singapore Paincare Holdings Ltd, a listed company on the stock exchange of Singapore from June 2020 to February 2024.

Between April 2017 to July 2022, Mr. Yap was the director and then senior director of Cushman & Wakefield VHS Pte Ltd where he led and develop the business valuation team to achieve the goals and targets set by the company, and strategized the growth of the business valuation team by offering business valuation and advisory service. From October 2011 to April 2017, Mr. Yap was the assistant manager and then director at Censere Group where he was responsible for planning, managing and leading the execution of various business valuation projects; conducting financial forecast reviews, business strategy analysis and financial modelling; performing various valuation works for financial reporting and transaction purposes; and performing due diligence for M&A transactions. Prior to joining Censere Group, he served as a principal accountant with JTC Corporation between November 2010 to July 2011. As the principal accountant, he was responsible for reviewing and preparing cashflow forecast to determine the optimal capital structure and financial sustainability of JTC Corporation and overseeing the subsidiaries of JTC Corporation to ensure its compliance with corporate governance. From July 2008 to October 2010, Mr. Yap was the analyst and then assistant manager at Asian Corporate Advisors Pte. Ltd, performing corporate finance and continuing sponsorship work. From October 2007 to July 2008, he was the financial analyst at Development Bank of Singapore, and between July 2005 to September 2007, Mr. Yap was the associate and then senior associate at KPMG Singapore performing external audit work.

Mr. Yap is a member of the Charter Financial Analyst, Chartered Accountant Singapore, Chartered Valuer and Appraiser and Singapore Institute of Directors. Mr. Yap obtained his Bachelor’s Degree in Accountancy from Nanyang Technological University in 2005.

Mr. Wang Jinxiao (“Mr. Wang”) is our independent director. Mr. Wang serves as chairman of the compensation committee and as a member of the audit and nomination committees.

Since May 2005, Mr. Wang has been serving as a director of Beijing Harrow Education Service Co., Ltd., where he is responsible financing, budgeting, cost control. The company owns 100% share of Harrow International School Beijing. Mr. Wang is also currently the chairman of Beijing HongJiFeng Innovation Culture Development Co., Ltd., and has been serving this role since August 2000. Between August 1995 to July 2000, Mr. Wang served as a director of Beijing Jixinhangxiu Development Co., Ltd. Prior to that, between April 1993 to July 1995, Mr. Wang was the Deputy GM of Financial Department of Sinochem International Petroleum Co., Ltd. From October 1989 to March 1993, Mr. Wang was the financial manager of Sinochem American Holding Company. From May 1988 to September 1989, he was the assistant to general manager of the accounting department at Sinochem Headquarters. From July 1985 to April 1988, Mr. Wang began his career has the lecturer of the accounting department of Beijing Technology and Business University, his alma mater.

Mr. Wang graduated with a Bachelor’s Degree in Financial Accounting from Beijing Technology and Business University in 1985, and obtained his postgraduate study of International Finance from the University of International Business and Economics in 2000.

Family Relationships

There are no family relations in respect of any member of the Board.

6.B. Compensation

Compensation of Executive Directors and Executive Officers

For the fiscal year ended December 31, 2025, we paid an aggregate of approximately S$455,701 (approximately US$353,405) in cash to our Executive Directors and Executive Officer.

For the financial year ended December 31, 2024, we paid an aggregate of approximately S$289,653 (approximately US$224,632) in cash to our Executive Directors and Executive Officer.

For the financial year ended December 31, 2023, we paid an aggregate of approximately S$257,446 (approximately US$199,654) in cash to our Executive Directors and Executive Officer. 

Employment Agreements

Employment Agreement between Mr. Xie and our Company

We have entered into an Employment Agreement with Mr. Xie that became effective on the date of the listing of the Company on Nasdaq Capital Market (“Effective Date”), pursuant to which he is employed as our Executive Chairman, Chief Executive Officer and Executive Director. The agreement provides for a monthly base salary equal to SGD 12,000.00, as per Mr. Xie’s existing agreement with Delixy Energy Pte. Ltd. Under the terms of the agreement, Mr. Xie’s employment will continue for the period commencing as of the Effective Date and ending (1) year after the Effective Date (“Initial Term”). The Initial Term shall automatically be extended one additional year unless either party gives written notice to the other party 60 days prior to expiration of the Initial Term that he does not wish to extend the agreement. The agreement also provides that Mr. Xie shall not, during the term of the agreement and for 2 years following the date of termination, carry on business in competition with the Group.

Employment Agreement between Ms. Chong and our Company

We have entered into an Employment Agreement with Ms. Chong, effective December 31, 2025, pursuant to which she will serve for the period commencing as of the effective date and ending (1) year after the effective date (“Initial Term”). The Initial Term shall automatically be extended one additional year unless either party gives written notice to the other party 60 days prior to expiration of the Initial Term that it or she, as applicable, does not wish to extend the agreement. Ms. Chong will receive an annual base salary of S$108,000 (approximately US$84,000).

Employment Agreement between Ms. Yao and our Company

We have entered into an Employment Agreement with Ms. Yao that will become effective on the Effective Dates, pursuant to which she will be employed as our chief operating officer. The agreement provides for a monthly base salary equal to SGD 17,200.00. Under the terms of the agreement, Ms. Yao’s employment will continue for the Initial Term. The Initial Term shall automatically be extended one additional year unless either party gives written notice to the other party 60 days prior to expiration of the Initial Term that he does not wish to extend the agreement. The agreement also provides that Ms. Yao shall not, during the term of the agreement and for 2 years following the date of termination, carry on business in competition with the Group. In connection with her appointment as Director, Ms. Yao Yuan entered into a director’s offer letter with the Company, pursuant to which she will serve as a director for an initial term of five years, subject to annual re-appointment by the Board of Directors. The director offer letter does not provide for separate cash or equity compensation to Ms. Yao Yuan.

Independent Director Agreements

Each of our Independent Directors have entered into an Independent Director Agreement with the Company. The terms and conditions of such Independent Director Agreements are similar in all material aspects. Each Independent Director Agreement is for an initial term of one year and will continue until the Independent Director’s successor is duly elected and qualified. Each Independent Director will be up for re-election each year at the annual shareholders’ meeting, if held, and, upon re-election, the terms and provisions of his or her Independent Director Agreement will remain in full force and effect. Any Independent Director Agreement may be terminated for any or no reason by the Independent Director or at a meeting called expressly for that purpose by a vote of the shareholders holding more than 50% of the voting power of our Ordinary Shares.

Under the Independent Director Agreements, the initial annual director fees that are payable to our Independent Directors will be US$50,000 to Mr. Lay, US$30,000 to Mr. Yap and US$30,000 to Mr. Wang. Such director fees are payable in cash on a monthly basis.

In addition, our Independent Directors will be entitled to participate in such share option scheme as may be adopted by the Company, as amended from time to time. The number of options granted, and the terms of those options will be determined from time to time by a vote of the Board of Directors; provided that each Independent Director shall abstain from voting on any such resolution or resolutions relating to the grant of options to that Independent Director.

Other than as disclosed above, none of our Independent Directors has entered into a service agreement with our Company or any of our subsidiary that provides for benefits upon termination of employment.

Equity Incentive Plan

Our shareholders and Board have adopted the Delixy Holdings Limited 2026 Equity Incentive Plan (“Delixy Incentive Plan”), to motivate attract and retain the best available personnel, provide additional incentives to staff, Directors and those that have or will contribute to the success of our Group and promote the success of our business. Under the Delixy Incentive Plan, the maximum aggregate number of Class A Ordinary Shares which may be issued pursuant to all awards under such plan is 1,635,000, which constitutes 10% of the total issued and outstanding Ordinary Shares of our Company on a fully-diluted basis as of the date of adoption. Any Class A Ordinary Shares covered by an award granted under the Delixy Incentive Plan (or portion of an award) that terminates, expires, lapses or repurchased for any reason will be deemed not to have been issued for purposes of determining the maximum aggregate number of Class A Ordinary Shares that may be issued under the Delixy Incentive Plan. As of the date of this annual report, we have not granted any awards under the Delixy Incentive Plan.

The following paragraphs summarize the principal terms of the Delixy Incentive Plan.

Types of awards. The Delixy Incentive Plan permits the awards of options, restricted shares, restricted share units or any other type of awards approved by our Board or the compensation committee.

Plan administration. Our Board or the compensation committee administers the Delixy Incentive Plan. Our Board or the compensation committee determines, among other things, the participants to receive awards, the type and number of awards to be granted to each participant, and the terms and conditions of each award grant.

Award agreement. Awards granted under the Delixy Incentive Plan are evidenced by an award agreement that sets forth terms, conditions and limitations for each award, which may include the term of the award, the provisions applicable in the event of the grantee’s employment or service terminates, and our authority to unilaterally or bilaterally amend, modify, suspend, cancel or rescind the award.

Eligibility. We may grant awards to our Directors, employees, business partners, consultants etc.

Vesting schedule. In general, the plan administrator determines the vesting schedule, which is specified in the relevant award agreement.

Exercise of awards. The exercise price per Share subject to an option is determined by the plan administrator and set forth in the award agreement, which may be a fixed price or a variable price related to the fair market value of the Ordinary Shares. The vested portion of option will expire if not exercised prior to the time as the plan administrator determines at the time of its grant.

Transfer restrictions. Awards may not be transferred in any manner by the eligible participant other than in accordance with the limited exceptions, such as transfers to our company or a subsidiary of ours, transfers to the immediate family members of the participant by gift, the designation of a beneficiary to receive benefits if the participant dies, permitted transfers or exercises on behalf of the participant by the participant’s duly authorized legal representative if the participant has suffered a disability, or, subject to the prior approval of the plan administrator or our Executive Officer or Director authorized by the plan administrator, transfers to one or more natural persons who are the participant’s family members or entities owned and controlled by the participant and/or the participant’s family members, including but not limited to trusts or other entities whose beneficiaries or beneficial owners are the participant and/or the participant’s family members, or to such other persons or entities as may be expressly approved by the plan administrator, pursuant to such conditions and procedures as the plan administrator may establish. 

Termination and amendment. Unless terminated earlier, the Delixy Incentive Plan has a term of 10 years. Our Board may terminate, amend or modify the plan, subject to the limitations of applicable laws. However, no such action may adversely affect in any material way any award previously granted without prior written consent of the participant.

6.C. Board Practices

Board of Directors

Our Board of Directors consists of five Directors, three of whom are “independent” within the meaning of the corporate governance standards of the Nasdaq listing rules and meet the criteria for independence set forth in Rule 10A-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Leadership Structure and Risk Oversight

Our Board of Directors actively manages our Company’s risk oversight process and receives periodic reports from management on areas of material risk to our Company, including operational, financial, legal, and regulatory risks. The committees of the Board of Directors will assist the Board of Directors in fulfilling its oversight responsibilities in certain areas of risk. The audit committee will assist the Board of Directors with its oversight of our Company’s major financial risk exposure. The compensation committee will assist the Board of Directors with its oversight of risks arising from our Company’s compensation policies and programs. The nominating and corporate governance committee will assist the Board of Directors with its oversight of risks associated with board organization, board independence, and corporate governance. While each committee will be responsible for evaluating certain risks and overseeing the management of those risks, the entire Board of Directors will continue to be regularly informed about the risks.

Board composition and director independence

As a company incorporated in the Cayman Islands, we qualify as a foreign private issuer that is permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from the corporate governance listing requirements of the Nasdaq Capital Market. We intend to rely on home country practice to be exempted from certain of the corporate governance requirements of Nasdaq, namely; (i) there will not be a necessity to have regularly scheduled executive sessions with independent Directors; and (ii) there will be no requirement for the Company to obtain Shareholder approval prior to an issuance of securities in connection with (a) the acquisition of stock or assets of another company; (b) equity-based compensation of Executive Officers, Directors, employees or consultants; (c) a change of control; and (d) transactions other than public offerings. Accordingly, our shareholders may be afforded less protection than they otherwise would under rules and regulations applicable to U.S. domestic issuers.

Mr. Xie, through Mega Origin, indirectly controls approximately 0% of our total issued and outstanding Class A Ordinary Shares, and 100% of our total issued and outstanding Class B Ordinary Shares, representing approximately 98.46% of the total voting power. As a result, we are a “controlled company” within the meaning of the Nasdaq Capital Market Stock Market Rules and therefore eligible for certain exemptions from the corporate governance requirements of the Nasdaq Capital Market listing rules, including (i) the requirement that a majority of our Board of Directors must be independent directors, (ii) the requirement that our director nominees must be selected or recommended solely by independent directors, and (iii) the requirement that we have a corporate governance and nominating committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities. We do not intend to rely on these exemptions applicable to a “controlled company” and will instead rely on the exemptions provided to foreign private issuers to be exempt from the corporate governance requirements of the Nasdaq Capital Market listing rules. However, in the event we cease to be a foreign private issuer, we intend to rely on these exemptions applicable to a “controlled company”. As a result of being a foreign private issuer and a controlled company, you may not have the same protection afforded to shareholders of companies that are not exempt from the corporate governance requirements identified above.

Committees of the Board of Directors

We have established an audit committee, a compensation committee and a nomination committee, each of which operates pursuant to a charter adopted by our Board. The Board may also establish other committees from time to time to assist our Company and the Board. The composition and functioning of all of our committees comply with all applicable requirements of the Sarbanes-Oxley Act of 2002, Nasdaq Capital Market and SEC rules and regulations. Each committee’s charter is available on our website at https://www.delixy.com. The reference to our website address does not constitute incorporation by reference of the information contained at or available through our website, and you should not consider it to be part of this annual report.

Audit committee

Mr. Lay, Mr. Yap and Mr. Wang, all of whom are independent Directors, serve on the audit committee, which is chaired by Mr. Lay. Our Board of Directors has determined that each are “independent” for audit committee purposes as that term is defined by the rules of the SEC and Nasdaq Capital Market, and that each has sufficient knowledge in financial and auditing matters to serve on the audit committee. Our Board has designated Mr. Lay as an “audit committee financial expert,” as defined under the applicable rules of the SEC. The audit committee’s responsibilities include:

Compensation committee

Mr. Lay, Mr. Yap and Mr. Wang, all of whom are independent Directors, serve on the compensation committee, which is chaired by Mr. Wang. Our Board has determined that each such member satisfies the “independence” requirements of Rule 5605(a)(2) of the Listing Rules of the Nasdaq Capital Market. The compensation committee’s responsibilities include:

Nomination committee

Mr. Lay, Mr. Yap and Mr. Wang, all of whom are independent Directors, serve on the nomination committee, which s chaired by Mr. Yap. Our Board of Directors has determined that each member of the nomination committee is “independent” as defined in the applicable Nasdaq Capital Market rules. The nomination committee’s responsibilities include:

Our nomination committee’s and Board’s priority in selecting board members is identification of persons who will further the interests of our shareholders through their established record of professional accomplishment, the ability to contribute positively to the collaborative culture among board members, knowledge of our business, understanding of the competitive landscape and professional and personal experience and expertise relevant to our growth strategy.

Controlled Company

Mr. Xie, through Mega Origin, indirectly controls approximately 0% of our total issued and outstanding Class A Ordinary Shares, and 100% of our total issued and outstanding Class B Ordinary Shares, representing approximately 98.46% of the total voting power. As a result, we are a “controlled company” within the meaning of the Nasdaq Capital Market Stock Market Rules and therefore eligible for certain exemptions from the corporate governance requirements of the Nasdaq Capital Market listing rules, including (i) the requirement that a majority of our Board of Directors must be independent directors, (ii) the requirement that our director nominees must be selected or recommended solely by independent directors, and (iii) the requirement that we have a corporate governance and nominating committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities. We do not intend to rely on these exemptions applicable to a “controlled company” and will instead rely on the exemptions provided to foreign private issuers to be exempt from the corporate governance requirements of the Nasdaq Capital Market listing rules. However, in the event we cease to be a foreign private issuer, we intend to rely on these exemptions applicable to a “controlled company”. As a result of being a foreign private issuer and a controlled company, you may not have the same protection afforded to shareholders of companies that are not exempt from the corporate governance requirements identified above.

Foreign Private Issuer Status

As a company incorporated in the Cayman Islands, we qualify as a foreign private issuer that is permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from the corporate governance listing requirements of the Nasdaq Capital Market. These practices may afford less protection to shareholders than they would enjoy if we complied fully with corporate governance listing requirements of such exchanges. We intend to rely on home country practice to be exempted from certain of the corporate governance requirements of Nasdaq, namely; (i) there will not be a necessity to have regularly scheduled executive sessions with independent Directors; and (ii) there will be no requirement for the Company to obtain Shareholder approval prior to an issuance of securities in connection with (a) the acquisition of stock or assets of another company; (b) equity-based compensation of Executive Officers, Directors, employees or consultants; (c) a change of control; and (d) transactions other than public offerings. Accordingly, our shareholders may be afforded less protection than they otherwise would under rules and regulations applicable to U.S. domestic issuers.

Code of Conduct, Code of Ethics, Insider Trading Policy and Executive Compensation Recovery Policy

We have adopted (i) a written code of business conduct and ethics and (ii) Insider Trading Policy that applies to our Directors, officers and employees, including our Chief Executive Officer, Chief Financial Officer, principal accounting officer or controller or persons performing similar functions, and we also intend to adopt an (iii) Executive Compensation Recovery Policy that applies to our officers, and employees, including our Chief Executive Officer, Chief Financial Officer, principal accounting officer or controller or persons performing similar functions, (collectively the “Policies”). A current copy of the Policies is posted on the Corporate Governance section of our website, which is located at https://www.delixy.com. The information on our website is deemed not to be incorporated in this annual report or to be a part of this annual report. We intend to disclose any amendments to the Policies, and any waivers of the Policies for our Directors, Executive Officers and senior finance executives, on our website to the extent required by applicable U.S. federal securities laws and the corporate governance rules of the Nasdaq Capital Market.

6.D. Employees

We employed 11 people as of the date of this annual report, 11 people as of December 31, 2025, 11 people as of December 31, 2024 and 11 people as of December 31, 2023, all of whom are based out of Singapore. As of December 31, 2025, while most of our employees undertake multiple roles in our Group’s operations, based on their core functions, our employees generally comprise three management personnel, five trading personnel, four logistics personnel and two administrative personnel.

We have developed various methods to ensure that employees are adequately and correctly trained for the functions they perform and are aware of the relevant legislations affecting our business. Our success depends on our ability to attract, retain, and motivate qualified employees. We believe that we maintain a good working relationship with our employees, and we have not experienced any material labor disputes or work stoppages. No collective bargaining agreement has been put in place.

We enter into standard labor contracts which contain standard confidentiality clauses with our employees.

6.E. Share Ownership

For information on the beneficial ownership of our Ordinary Shares by our directors and senior management, see “7.A. Major Shareholders” below. As of the date of this annual report, none of our directors or senior management hold any unexercised options or unvested share-based awards under our 2026 Equity Incentive Plan.

Item 7. Major Shareholders and Related Party Transactions

7.A. Major Shareholders

The following table sets forth information regarding beneficial ownership of our share capital as of the date of this annual report by:

The following table also sets forth the position(s), office(s) or other material relationship(s) these principal and selling shareholders have had with the Company within the past three years from the date of this annual report.

Applicable percentage ownership is based on 7,174,000 Class A Ordinary Shares issued and outstanding and 9,176,000 Class B Ordinary Shares issued and outstanding as at the date of this annual report. At a general meeting of shareholders, each Class A Ordinary Share is entitled to one (1) vote, and each Class B Ordinary Share is entitled to fifty (50) votes, on all matters submitted to a vote of shareholders. Our Class B Ordinary Shares are convertible into Class A Ordinary Shares on a one-for-one basis at the option of the holder, subject to the provisions of our amended and restated memorandum and articles of association. Our Class A Ordinary Shares are not convertible into Class B Ordinary Shares. Except for voting rights and certain other rights as set forth in our amended and restated memorandum and articles of association, the Class A Ordinary Shares and Class B Ordinary Shares have substantially identical rights, including rights to dividends and distributions.

The information presented below regarding beneficial ownership of our voting securities has been presented in accordance with the rules of the SEC and is not necessarily indicative of ownership for any other purpose. Under these rules, a person is deemed to be a “beneficial owner” of a security if that person has or shares the power to vote or direct the voting of the security or the power to dispose or direct the disposition of the security. A person is deemed to own beneficially any security as to which such person has the right to acquire sole or shared voting or investment power within 60 days through the conversion or exercise of any convertible security, warrant, option or other right. More than 1 person may be deemed to be a beneficial owner of the same securities. The percentage of beneficial ownership by any person as of a particular date is calculated by dividing the number of shares beneficially owned by such person, which includes the number of shares as to which such person has the right to acquire voting or investment power within 60 days, by the sum of the number of shares outstanding as of such date, plus the number of shares as to which such person has the right to acquire voting or investment power within 60 days. Consequently, the denominator used for calculating such percentage may be different for each beneficial owner. Except as otherwise indicated below and under applicable community property laws, we believe that the beneficial owners of our shares listed below have sole voting and investment power with respect to the shares shown.

Unless otherwise noted below, the address of each person listed on the table is 883 North Bridge Road #04-01, Southbank Singapore 198785.