Financial Performance - For the six months ended June 30, 2024, the group reported an unaudited loss attributable to shareholders of approximately RMB 129.7 million, an increase in loss of about RMB 26.9 million compared to the same period last year[1]. - The group's unaudited revenue for the same period was approximately RMB 1,430 million, representing a slight increase of about 1.9% year-on-year, primarily due to increased sales of N-Methyl-2-pyrrolidone and N,N-Dimethylformamide[2]. - The unaudited basic loss per share for the six months ended June 30, 2024, was approximately RMB 2.15, compared to RMB 1.71 for the same period last year[3]. - The company reported a pre-tax loss of RMB 115,847,000 for the six months ended June 30, 2024, compared to a loss of RMB 97,820,000 in the same period of 2023[15]. - The net cash generated from operating activities after tax was RMB 113,343,000, down from RMB 266,458,000 in the prior year[15]. - The net loss attributable to shareholders was approximately RMB 129.7 million, an increase of RMB 26.9 million compared to a loss of RMB 102.8 million in the previous year, primarily due to a decrease in gross margin[25]. Sales and Production - The total sales volume (excluding trading) reached approximately 539,000 tons, an increase of about 3.5% compared to the same period last year[2]. - Urea sales contributed RMB 355,449,000, accounting for 24.9% of total revenue, down from 34.8% in the previous year[13]. - Ammonia sales increased to RMB 431,285,000, representing 30.2% of total revenue, compared to 26.2% in the prior year[13]. - The gross margin decreased from approximately 8.8% to 5.5%, mainly due to rising natural gas prices, with sales costs amounting to approximately RMB 1,350 million, an increase of about 5.5% year-on-year[25]. - The Guang'an Jiuyuan factory achieved record production and energy consumption levels, contributing an estimated additional revenue of over RMB 20 million through operational innovations[27]. Cash Flow and Liquidity - The net cash inflow from operating activities before interest paid was approximately RMB 113.3 million, a decrease from RMB 266.5 million in the previous year[6]. - The group reported a net cash and cash equivalents balance of RMB 52.8 million as of June 30, 2024, down from RMB 270.3 million at the beginning of the year[7]. - The total borrowings as of June 30, 2024, amounted to RMB 2,409,439 thousand, a decrease from RMB 2,793,478 thousand as of December 31, 2023[23]. - The capital debt ratio as of June 30, 2024, was 77%, up from 75% at the end of 2023, indicating a higher level of financial leverage[53]. - As of June 30, 2024, the company reported current liabilities of approximately RMB 2,990,178,000, with cash and bank deposits amounting to about RMB 52,754,000[50]. Dividends and Shareholder Information - The group did not recommend any interim dividend for the six months ended June 30, 2024[2]. - The company did not recommend any dividend payment for the six months ended June 30, 2024[18]. - As of June 30, 2024, there are 171,492,259 unexercised stock options under the stock option plan, representing approximately 2.84% of the company's shares[63]. - The company has a total of 8,702,675 unexercised convertible securities as of June 30, 2024[65]. - The diluted loss per share for the year ending June 30, 2024, is calculated based on RMB 0.88, assuming all unexercised convertible securities are converted[66]. Market Outlook - For the second half of 2024, DMF prices are expected to continue weak operations with limited upward space due to increasing supply and demand conflicts[32]. - The NMP market is anticipated to maintain low-level fluctuations in the second half of 2024, with supply pressures and insufficient demand expectations[34]. - Methanol prices are projected to show a trend of first declining, then rising, and finally falling again in the second half of 2024[37]. - The ammonia market is likely to experience a price trend of first declining, then rising, and finally declining again due to various market factors[41]. - The overall demand for urea is expected to decrease significantly in the second half of 2024 due to reduced agricultural needs and strict export policies[45]. Operational Efficiency and Cost Control - The company has maintained a focus on cost control, with administrative expenses decreasing by approximately 11.8% compared to the previous year[25]. - The company aims to reduce operational costs through technical upgrades and improved production efficiency, achieving historical lows in comprehensive energy consumption at certain plants[46]. - The company plans to optimize the production costs of the DMF and NMP projects, which were successfully launched in May 2023, to significantly enhance product competitiveness[28]. - The company has implemented a production organization model of "production before the year-end, major repairs after the year" at the Dazhou Jiuyuan factory, contributing significantly to economic benefits[29]. Employee and Management - The company is committed to enhancing employee training and management capabilities to improve overall operational efficiency[47]. - As of June 30, 2024, the group has a total of 821 employees, a slight decrease from 823 employees in 2023[57]. Risk Management - The group faces foreign exchange risk due to certain loans denominated in foreign currencies, primarily Hong Kong dollars, and management monitors this risk[59]. - The company has taken measures to improve liquidity and financial conditions, including negotiating loan renewals or restructurings with banks[72]. Investments and Acquisitions - No significant acquisitions or disposals were reported in the six months ending June 30, 2024[55]. - The group has no other significant investment plans apart from those previously disclosed[57].

Financial Performance - For the six months ended June 30, 2024, the unaudited net loss attributable to shareholders was approximately RMB 129.7 million, an increase in loss of about RMB 26.9 million compared to the same period last year[1]. - The unaudited revenue for the six months ended June 30, 2024, was approximately RMB 1,430 million, representing a slight increase of about 1.9% compared to the same period last year, primarily due to increased sales of N-Methylpyrrolidone and N,N-Dimethylformamide[1]. - The company reported a significant increase in interest income to RMB 7,403 thousand from RMB 338 thousand in the same period last year[2]. - For the six months ended June 30, 2024, the company reported a net loss of RMB 135,073,000 compared to a net loss of RMB 102,831,000 for the same period in 2023, representing an increase in loss of approximately 31.3%[14]. - The total revenue for the six months ended June 30, 2024, was RMB 1,429,617,000, a slight increase from RMB 1,403,423,000 in the same period of 2023, reflecting a growth of about 1.9%[10]. - The company experienced a pre-tax loss of RMB 115,847,000 for the six months ended June 30, 2024, compared to a pre-tax loss of RMB 97,820,000 in the same period of 2023, indicating a deterioration in operational performance[11]. - The basic and diluted loss per share for the six months ended June 30, 2024, was RMB 0.0215, compared to RMB 0.0170 for the same period in 2023, reflecting a worsening loss per share[14]. Cash Flow and Liquidity - The unaudited operating cash inflow before changes in working capital and payment of income tax and interest was approximately RMB 62.9 million, an increase of about RMB 46.1 million compared to approximately RMB 16.8 million in the same period last year[1]. - The unaudited net cash inflow from operating activities was RMB 77,508 thousand for the six months ended June 30, 2024, compared to RMB 231,241 thousand in the same period last year[5]. - Cash generated from operating activities for the six months ended June 30, 2024, was RMB 113,343,000, a significant decrease from RMB 266,458,000 in the same period of 2023, highlighting cash flow challenges[11]. - The company reported a net increase in current liabilities amounting to RMB 2,990,178,000 as of June 30, 2024, indicating potential liquidity concerns[8]. - The group has current liabilities amounting to approximately RMB 2,990,178,000[44]. - The group's cash and bank balances as of June 30, 2024, are approximately RMB 52,754,000, with no unused bank credit[46]. - The company has taken multiple measures to improve liquidity and financial condition, including restructuring loans with banks[66]. Operational Highlights - The total sales volume (excluding trading) reached approximately 539,000 tons, an increase of about 3.5% compared to the same period last year[1]. - The company plans to continue focusing on the production and sales of chemical products and fertilizers in mainland China, which remains its primary market[7]. - The company continues to optimize its operational processes and improve economic efficiency, with a focus on enhancing core competitiveness through standardized work practices[24]. - Guang'an Jiuyuan Factory resumed production of the methanol-ammonia joint production unit on January 20, achieving historical best levels in both output and energy consumption in 2023, with an expected annual revenue increase of over RMB 20 million[26]. - The 100,000 tons/year DMF and NMP projects at Guang'an Jiuyuan Electronic Materials Factory, which started production in May 2023, are undergoing optimization to significantly reduce production costs and enhance product competitiveness[27]. - Dazhou Jiuyuan Factory plans to resume production of ammonia and urea units on March 26, 2024, following a major overhaul, with expected output and energy consumption at historical best levels in 2023[28]. - Jiangsu Blue Planet's 400,000 tons/year propylene oxide project is nearing completion and is expected to enter trial production in Q4 2024, potentially generating an annual sales increase of approximately RMB 4 billion[29]. Market Trends - The national DMF production capacity is projected to reach 1.8 million tons in 2024, a 7.14% increase from 2023, with a production increase of 10.11% in the first half of 2024 compared to the same period in 2023[30]. - The average monthly operating rate for DMF in the first half of 2024 was 45.83%, a decrease of 24.02% compared to the same period in 2023, indicating a significant supply-demand imbalance[30]. - NMP production capacity is expected to grow by approximately 11% in 2024, with market prices remaining under pressure and low trading activity due to weak demand from the new energy vehicle sector[33]. - Domestic methanol production reached 41.38 million tons in the first half of 2024, an increase of 11.26% year-on-year, with an average operating rate of 82.31%, up 6.54% from the previous year[35]. - In the first half of 2024, domestic synthetic ammonia production reached approximately 30 million tons, an increase of 13% year-on-year, with an average industry operating rate of 72.5%, up 7.5% from last year[37]. - The synthetic ammonia market is projected to see an increase in production capacity by 5.51 million tons from July to December 2024, which may put pressure on supply[38]. - The urea market is expected to experience a downward shift in trading focus in the second half of 2024 due to weak supply and demand dynamics, despite an anticipated increase of 4 million tons in production capacity[41]. Corporate Governance and Compliance - The Audit Committee was established on June 10, 2003, and is responsible for reviewing the financial reporting process and internal control systems[68]. - The company has complied with the corporate governance code since January 1, 2005[69]. - The company has adopted a standard code of conduct for directors regarding securities trading, ensuring compliance with trading regulations[67]. - There are no known interests in competitive businesses held by directors or management during the review period[65]. - The company has not disclosed any significant shareholder interests beyond those already reported[63]. Employee and Shareholder Information - As of June 30, 2024, the group had a total of 821 employees, a slight decrease from 823 in 2023[52]. - The group has 819 employees stationed in China and 2 in Hong Kong as of June 30, 2024[52]. - The total beneficial ownership of shares and related securities by director Tang Guoqiang is 7,869,800,000, representing 130.55% of the issued share capital[62]. - Director Shi Jianmin holds a total of 370,000,000 shares and related securities, which is 6.14% of the issued share capital[62]. - Director Zhang Weihua has beneficial ownership of 500,000,000 shares, accounting for 8.29% of the issued share capital[62].

Financial Performance - In 2023, the group's gross profit margin decreased from approximately 24.7% in 2022 to 10.9% in 2023 due to falling product prices and rising raw material costs[7]. - As of December 31, 2023, the group's total borrowings, convertible bonds, and notes payable amounted to approximately RMB 3.69 billion[12]. - The group anticipates continued weak performance in the DMF market in 2024, with an additional 300,000 tons of new capacity expected to come online[1]. - The overall demand in the downstream lithium battery sector is expected to remain generally weak, maintaining low operational levels in the industry[1]. - The top five customers accounted for approximately 34.3% of the group's total revenue, with the largest customer contributing about 13.8%[82]. - The group reported a positive operating cash flow for 2023, indicating that management should continue its actions and measures[81]. Operational Efficiency - The group plans to reduce non-scheduled downtime to historical lows through internal reforms and technological upgrades, aiming to improve operational efficiency[4]. - The group is exploring the feasibility of extending maintenance intervals from annually to biennially to reduce costs and improve output[6]. - The group has implemented performance assessments and compensation reforms to enhance team creativity and execution[5]. - The group is focused on real-time monitoring of changes in the fertilizer and chemical industry to navigate challenges and pursue opportunities[4]. - The group has prioritized production and equipment management to optimize production processes and improve overall product quality[102]. Environmental Management - The group has successfully obtained ISO certifications in environmental management, energy management, and quality management, demonstrating its commitment to high standards[102]. - The group aims to reduce waste and emissions as part of its sustainability goals, which are integrated into its business strategy[123]. - The group has implemented ISO9001:2015, ISO14001:2015, and ISO50001:2018 certifications in 2023, reflecting its commitment to quality and environmental management[124]. - The group has established a comprehensive environmental management system (EMS) and most operations are ISO 14001 certified, ensuring compliance with international environmental management standards[175]. - The group has implemented a wastewater reuse strategy, aiming to maximize the reuse of treated wastewater in its operations[166]. Sustainability Goals - The company aims to reduce total carbon emissions by 115.55% over a ten-year period, reflecting a strong commitment to sustainability[142]. - The group has set a target to reduce water consumption by 50,000 cubic meters annually, achieving a total reduction of 1,080,562 cubic meters from 2021 to 2023, which is 216% of the 10-year reduction target[181]. - The group has achieved 115.55% progress towards its 10-year greenhouse gas emission reduction target, with current emissions at 146,717.31 tons of CO2 equivalent[168]. - The company has made significant progress in water conservation, with a project expected to save approximately 443,500 cubic meters of water annually, reducing water usage by 508,082 cubic meters compared to 2022[194]. - The company has installed new equipment to improve energy efficiency and reduce pollution, alongside ongoing renovations to further minimize environmental impact[199]. Compliance and Governance - The company ensures compliance with all relevant product quality laws and regulations, with no reported serious violations during the reporting period[69]. - The company maintains strict regulations on employee discipline and professional conduct to prevent potential bribery and fraud[50]. - The company has established a dedicated whistleblower hotline to allow stakeholders to report any misconduct anonymously[50]. - The audit committee has reviewed the group's financial reporting procedures and internal control systems, ensuring compliance with accounting principles[95]. - The audit committee consists of three independent non-executive directors, ensuring oversight of the group's financial reporting[79]. Community Engagement - The company actively participated in community projects and volunteer services, contributing resources such as RMB 4,277.5 for firefighter support and 10 tons of urea for donation[54]. - The group has received multiple awards for its contributions to environmental protection and corporate social responsibility during the reporting period[124]. Employee Engagement and Training - A total of 327 employees, representing approximately 58.9% of the workforce, participated in anti-corruption training, averaging 3.65 hours per employee[51]. - The company has not exercised any stock options during the fiscal year ending December 31, 2023[32]. - The company has 171,492,259 unissued share options as of December 31, 2023, representing approximately 2.84% of the company's shares[67].

Financial Performance - For the year ended December 31, 2023, the sales revenue was approximately RMB 2,905,000,000, a decrease of about 9.4% compared to 2022[2]. - The loss attributable to shareholders was approximately RMB 152,000,000, a decrease of RMB 354,000,000 compared to a profit of RMB 202,000,000 in 2022[2]. - The company reported a net loss of approximately RMB 154,615,000 for the year ended December 31, 2023[14]. - The basic loss per share for the year was approximately RMB 0.0253[2]. - Total revenue for the year ended December 31, 2023, was RMB 2,904,857 thousand, a decrease from RMB 3,205,226 thousand in 2022[117]. - The group recorded a net loss of RMB (107,652,000) in 2023 compared to a profit of RMB 355,824,000 in 2022[133]. - Basic loss per share for 2023 was RMB (152,341,000), compared to a profit of RMB 201,563,000 in 2022, representing a substantial decline in profitability[142]. Revenue Breakdown - The sales revenue and quantity for major products showed the following changes: Urea sales revenue decreased by 12.0% and sales quantity increased by 1.2%[3]. - Ammonia sales revenue decreased by 13.8% and sales quantity increased by 6.7%[3]. - Methanol sales revenue decreased by 14.5% and sales quantity decreased by 6.0%[3]. - The revenue from urea sales was RMB 888,393 thousand in 2023, down from RMB 1,009,200 thousand in 2022[117]. - The group's revenue from major customer A decreased to 13.81% in 2023 from 15.11% in 2022[124]. Assets and Liabilities - Total assets as of December 31, 2023, were RMB 6,266,330,000, an increase from RMB 5,845,522,000 in 2022[7]. - The total liabilities increased to RMB 5,354,515,000 in 2023, compared to RMB 4,785,396,000 in 2022, reflecting a growth of 11.9%[14]. - As of December 31, 2023, the company's net current liabilities amounted to approximately RMB 2,859,724,000[14]. - The total assets minus current liabilities decreased to RMB 1,985,741,000 in 2023 from RMB 2,492,369,000 in 2022, indicating a decline of 20.3%[14]. - The company's total debt amounted to RMB 3,685,589,000, an increase from RMB 3,127,908,000 in 2022, reflecting a rise in the debt-to-equity ratio to 75% from 70%[184]. Cash Flow and Operating Activities - The net cash inflow from operating activities before changes in working capital and payment of income tax and interest was approximately RMB 306,000,000, a decrease of about 62.8% from RMB 823,000,000 in 2022[2]. - The company generated a net operating cash inflow of approximately RMB 224,469,000 during the year[14]. - Cash and cash equivalents decreased from RMB 220,143,000 in 2022 to RMB 16,951,000 in 2023, a decline of approximately 92.3%[179]. - The company maintained sufficient cash and cash equivalents to ensure operational liquidity through various financing sources[111]. Equity and Dividends - The total equity attributable to the company's owners was RMB 908,102,000, a decrease from RMB 1,059,039,000 in 2022[7]. - The company does not recommend the payment of any final dividend for the year ended December 31, 2023[3]. - The total equity as of December 31, 2023, was RMB 387,533,000, a decrease from RMB 538,470,000 in 2022[190]. Costs and Expenses - The cost of goods sold increased to RMB 2,588,660,000 in 2023 from RMB 2,411,956,000 in 2022[133]. - Employee costs, including salaries and bonuses, rose to RMB 104,206,000 in 2023 from RMB 90,663,000 in 2022[133]. - Financial expenses decreased slightly to RMB 238,925,000 in 2023 from RMB 244,903,000 in 2022[127]. - The income tax expense for 2023 was RMB 46,963,000, significantly lower than RMB 154,780,000 in 2022[130]. Financial Instruments and Risks - The group faces various financial risks, including market risk, credit risk, and liquidity risk, with a focus on minimizing potential negative impacts on financial performance[98]. - The group has minimal foreign exchange risk as most transactions are denominated in RMB, with no current hedging policies in place[99]. - The group manages credit risk by depositing cash in reputable banks and assessing the credit quality of trade receivables[103]. - The company's financial assets have significantly increased credit risk during the reporting period, particularly when debtors are overdue by more than 30 days[104]. Accounting Policies and Estimates - The group adopted new and revised Hong Kong Financial Reporting Standards effective from January 1, 2023, with no significant impact on the financial statements for the current and prior years[17]. - The consolidated financial statements are prepared in accordance with Hong Kong Financial Reporting Standards and applicable disclosure requirements[18]. - The group applies significant judgments in the application of accounting policies that have a substantial impact on the amounts recognized in the consolidated financial statements[91]. - The group assesses the carrying amounts of tangible and intangible assets at each reporting period to determine if there are indications of impairment losses[86]. Subsidiaries and Ownership - The company has 100% ownership in several subsidiaries, including Dazhou Jiuyuan Chemical Co., Ltd. with a registered capital of RMB 420 million and Sichuan Chengyuan Chemical Co., Ltd. with RMB 8 million[162]. - The company has pledged 100% equity of several subsidiaries, including Dazhou Jiuyuan Chemical and Sichuan Chengyuan, as collateral for loans[168]. - The company operates in various sectors, including chemical production and sales, with subsidiaries located in mainland China and Hong Kong[162]. Inventory and Receivables - The total inventory value as of December 31, 2023, is RMB 216.1 million, a decrease from RMB 241.3 million in 2022[166]. - Accounts receivable decreased from RMB 1,047,417,000 in 2022 to RMB 1,027,975,000 in 2023, a reduction of approximately 1.5%[169]. - The company reported no change in the allowance for trade receivables losses, maintaining a loss provision of 0% for both years[174]. Capital Management and Financing - The company maintained a capital management strategy focused on ensuring sustainable operations and optimizing capital structure to reduce costs[183]. - The total amount of convertible bonds was RMB 892,111,000 in 2023, compared to RMB 810,623,000 in 2022[184]. - The company issued convertible bonds with a principal amount of HKD 832,000,000 (approximately RMB 665,600,000) at an annual interest rate of 7%[200].

Financial Performance - The group reported a net loss attributable to shareholders of approximately RMB 102.8 million for the six months ended June 30, 2023, a decrease from a profit of RMB 329.2 million in the same period last year[2]. - Revenue for the six months ended June 30, 2023, was approximately RMB 1.403 billion, representing a decrease of about 16.0% compared to RMB 1.671 billion in the previous year, primarily due to a reduction in product prices[2]. - The total sales volume (excluding trading) reached approximately 521,359 tons, a decrease of 8.0% compared to the same period last year[2]. - Basic loss per share for the six months ended June 30, 2023, was approximately RMB 1.71, compared to earnings of RMB 3.96 per share in the same period last year[2]. - The group experienced a net cash outflow from operating activities of RMB 77.7 million for the six months ended June 30, 2023, compared to a net inflow of RMB 210 million in the previous year[9]. - For the six months ended June 30, 2023, the company reported a net loss of RMB 102,831,000 compared to a net profit of RMB 226,438,000 for the same period in 2022[26]. - The company experienced a pre-tax loss of RMB 97,820,000 for the six months ended June 30, 2023, compared to a pre-tax profit of RMB 313,657,000 in the same period of 2022[20]. - Operating cash flow for the six months ended June 30, 2023, was RMB 271,855,000, a decrease of 63.7% from RMB 746,903,000 in the same period of 2022[20]. Dividends and Shareholder Returns - The group did not recommend the payment of any interim dividend for the six months ended June 30, 2023[3]. - The company did not recommend any dividend payment for the six months ended June 30, 2023[28]. Assets and Liabilities - Total assets as of June 30, 2023, were approximately RMB 5.741 billion, a slight decrease from RMB 5.846 billion as of December 31, 2022[6]. - Total liabilities as of June 30, 2023, were approximately RMB 4.785 billion, remaining relatively stable compared to RMB 4.785 billion as of December 31, 2022[8]. - As of June 30, 2023, the company had net current liabilities of RMB 2,710,553,000[14]. - The group’s cash and bank balances as of June 30, 2023, were approximately RMB 270,297,000, with no available bank credit facilities[84]. - The capital-to-debt ratio as of June 30, 2023, was 73%, compared to 70% as of December 31, 2022[85]. - The group had no significant contingent liabilities as of June 30, 2023[86]. - The group has approximately RMB 2,020,734,000 in unpaid capital commitments as of June 30, 2023[83]. Operational Highlights - Urea sales accounted for 34.8% of total revenue in the first half of 2023, generating RMB 488,642,000, while ammonia sales contributed 26.2% with RMB 368,300,000[18]. - The Guang'an Jiuyuan factory successfully completed the first trial run of the carbon monoxide project on May 13, 2023, producing qualified products[46]. - The newly constructed DMF and NMP projects at the Guang'an Jiuyuan Electronic Materials Factory achieved successful trial runs on May 22, 2023, with an expected annual additional sales of RMB 3 billion[47]. - Dazhou Jiuyuan plant implemented a new production model, achieving record production levels and energy efficiency post-maintenance, contributing significantly to the group's economic benefits[49]. - Jiangsu Blue Planet project, acquired in September 2022, is nearing completion with expected annual sales of approximately 4 billion after trial production in Q3 2023[50]. Market Conditions - NMP market prices showed a downward trend in H1 2023, with no new production capacity added, and demand from the power battery sector decreased by 9.32%[51][52]. - In H2 2023, NMP supply is expected to increase by 400,000 to 500,000 tons, leading to significant pressure on prices, which are anticipated to remain weak[53]. - DMF production capacity increased by 300,000 tons in H1 2023, but the overall market showed a downward trend due to weak demand and low operating rates[54][57]. - The domestic methanol market saw a production decrease of 0.63% in H1 2023, with prices dropping below 2,000 yuan per ton, the lowest in nearly two years[61]. - Methanol imports increased by 6.64% in H1 2023, while downstream consumption decreased by 2.72%, indicating a supply-demand imbalance[61]. - In H2 2023, methanol prices are expected to rise temporarily due to seasonal demand, but overall price increases will be limited due to macroeconomic pressures[62][64]. - The epoxy propylene market experienced fluctuations, with prices expected to decline in H2 2023 due to increased supply and weak demand during the traditional off-season[58][60]. - The overall market outlook suggests a potential for price recovery in the second half of 2023, despite initial downward pressure due to increased supply[72]. Strategic Initiatives - The company plans to optimize its sales model to increase the proportion of direct sales customers and maximize sales profits[76]. - The company aims to reduce operational costs through various measures, including performance assessments and cost-saving initiatives[76]. - The company is pushing for the trial production and optimization of new projects such as DMF&NMP and propylene oxide, aiming to create new sales and profit growth points[79]. - The company will continue to monitor and adjust production organization and operational loads to ensure optimal operational efficiency[76]. Shareholder Information - The major shareholders include Mr. Zhang Weihua, who holds 1,520,000,000 shares, representing 25.22% of the issued share capital[106]. - As of June 30, 2023, the total equity interest of Mr. Tang Guoqiang is approximately 7,949,800,000 shares, which is 131.88% of the issued share capital[106]. - The company has not identified any individuals, other than directors or senior management, with significant shareholding interests that require disclosure under the Securities and Futures Ordinance[107]. Corporate Governance - The audit committee, established on June 10, 2003, is responsible for reviewing the financial reporting procedures and internal control systems of the company[114]. - The company has adopted a code of conduct for securities trading, ensuring compliance with trading regulations and standards[112]. - No shares were purchased, sold, or redeemed by the company or any of its subsidiaries during the review period[116]. - The company continues to engage with banks for loan renewal or restructuring to enhance its financial stability[111].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公佈之內 容概不負責，對其準確性或完整性亦不發表任何聲明，並明確表示概不 就因本公佈全部或任何部分內容而產生或因依賴該等內容而引致之任 何損失承擔任何責任。 玖 源 化 工（ 集 團 ）有 限 公 司 Ko Yo Chemical (Group) Limited （於開曼群島註冊成立之有限公司） （股份代號：00827） 截 至 二 零 二 三 年 六 月 三 十 日 止 六 個 月 中 期 業 績 公 佈 摘 要 截 至 二 零 二 三 年 六 月 三 十 日 止 六 個 月，未 經 審 核 本 集 團 股 東 應 佔 虧 損約為人民幣102,800,000元，較去年同期減少溢利人民幣329,200,000元。 截 至 二 零 二 三 年 六 月 三 十 日 止 六 個 月，本 集 團 未 經 審 核 之 營 運 資 金 變 動 及 支 付 利 得 稅 和 利 息 前 的 經 營 業 務 流 入 現 金 淨 額 約 為 人 民 幣 16,800,000元，較去年同期的人民幣532,800,000元減少人民幣516,000,000 ...

Environmental Impact and Sustainability Goals - The total greenhouse gas emissions from the group's operations amounted to 287,983.35 tons of CO2 equivalent, with a density of 9.48 tons per square meter of total production area and 0.23 tons per ton of chemical products produced[6]. - The group achieved a 10.3% reduction in total greenhouse gas emissions in 2022 compared to 2021, with a total reduction of 10,239 tons of greenhouse gases at the Guang'an factory[9]. - The group has set a target to reduce total carbon emissions by 19,300 tons of CO2 equivalent over the next 10 years, with annual reductions of 1,930 tons planned[11]. - The group aims to reduce total waste generation by 3% by 2023 compared to the 2022 baseline, as part of its sustainability commitment[16]. - The company is committed to using resources responsibly, with most operations certified under ISO 14001, and aims to reuse wastewater wherever possible[17]. - The company continues to invest resources in managing and monitoring environmental and social performance, focusing on sustainable development through technological advancements[92]. - The company is committed to strict compliance with applicable regulations and actively engages stakeholders on significant issues such as energy, emissions, and waste management[92]. - The company has achieved ISO certifications for environmental management (ISO 14001), energy management (ISO 50001), and quality management (ISO 9001)[176]. - The company has established an environmental management system to enhance its sustainable development performance[195]. - The company emphasizes the importance of stakeholder engagement in identifying key ESG issues through surveys and discussions[183]. Waste Management - The group produced 470.51 tons of hazardous waste during the reporting period, an increase of 98.7% compared to 236.82 tons in 2021, primarily due to the biennial replacement of chemical catalysts[14]. - Non-hazardous waste generation increased by 62.6% to 179.08 tons, attributed to increased production and workforce size[15]. - The total wastewater discharged during the reporting period was 226,413 cubic meters, with a density of 4.66 cubic meters per square meter of total production area[23]. - The company has implemented automatic samplers to monitor water quality, ensuring that all discharged wastewater meets the ammonia industry water pollutant discharge standards[25]. Financial Performance - The company's operating cash inflow before changes in working capital and payment of income tax and interest for the year ended December 31, 2022, was approximately RMB 823 million, a decrease of about 7.9% compared to RMB 894 million in 2021[37]. - The profit attributable to shareholders for the year ended December 31, 2022, was approximately RMB 202 million, a decrease of about 46.7% compared to RMB 379 million in 2021[37]. - The sales revenue for the year ended December 31, 2022, was approximately RMB 3,205 million, an increase of about 4.5% compared to the previous year[37]. - The sales cost increased to approximately RMB 2,412,000,000, reflecting a 7.0% rise due to higher raw material prices[70]. - The gross profit margin declined from approximately 26.5% in 2021 to 24.7% in 2022, attributed to rising raw material market prices[71]. - Distribution costs surged by approximately 71.6% compared to the previous year, with a distribution cost to sales ratio of 1.42%, an increase of 0.55% from 2021[71]. - Administrative expenses rose by approximately 29.2% to about RMB 149,600,000, mainly due to increased business activities and inflation[71]. - Other income decreased significantly from approximately RMB 140,300,000 in 2021 to about RMB 5,900,000 in 2022, primarily due to the sale of investment properties in the previous year[71]. Production and Sales - The total urea production in 2022 is estimated at 56.3 million tons, a year-on-year increase of 4.8%, with domestic urea capacity around 75.35 million tons, growing by 3.4% year-on-year[49]. - The average price of urea in 2022 was RMB 2,731 per ton, an increase of RMB 333 per ton compared to the average price of RMB 2,398 per ton in 2021[49]. - The sales volume of urea was 394,326 tons, with a sales revenue of RMB 1,009 million, reflecting a revenue increase of 4.9% but a volume decrease of 9.7%[37]. - The sales volume of methanol was 399,170 tons, with a sales revenue of RMB 912 million, showing a revenue decrease of 7.9% and a volume decrease of 12.2%[37]. - In 2022, methanol production in China is projected to be 68.41 million tons, a year-on-year increase of 1.36%, with domestic methanol capacity reaching approximately 100.91 million tons, up 4.1% year-on-year[51]. - The average price of methanol in 2022 was RMB 2,570 per ton, an increase of RMB 20 per ton compared to the average price of RMB 2,550 per ton in 2021[51]. - The company recorded a revenue of approximately RMB 3,205,000,000 for the fiscal year, representing an increase of 4.5% compared to the previous year, primarily driven by increased sales of urea and ammonia[69]. Operational Efficiency and Challenges - The company faced challenges such as tight natural gas supply and extreme weather, yet managed to maintain stable operations and achieve profitability[42]. - The company plans to reduce operational costs and improve efficiency through technical upgrades and management reforms[62]. - The company is focusing on improving its internal decision-making efficiency and enhancing employee training to boost overall productivity[64]. - The company emphasizes long-term production stability and has initiated measures to optimize production and equipment management[176]. - The company is expected to face ongoing impacts from "dual carbon" and "energy consumption dual control" policies in 2023, affecting the methanol market[55]. Corporate Governance and Management - The company has a strong management team with over 30 years of experience in various leadership roles, enhancing its operational capabilities[95][96][101]. - The company has a diverse board of directors with expertise in economics, finance, and management, contributing to strategic decision-making[97][99][100]. - The board of directors includes both executive and independent non-executive members, with specific terms for their service contracts[116]. - The audit committee consists of three independent non-executive directors, ensuring compliance with financial reporting and internal control systems[164]. Future Outlook - The outlook for 2023 indicates a potential weakening of urea prices due to increased supply and seasonal demand fluctuations[50]. - The company anticipates that the synthetic ammonia market in 2023 will experience a weak and fluctuating price pattern due to global economic recession expectations and geopolitical instability[61]. - New projects, including a 100,000-ton DMF project and a 400,000-ton epoxy propane project, are expected to begin trial production in Q2 2023[65]. - The company is working on a 1.2 million-ton nylon 66 project, with the first phase (600,000 tons/year of hexamethylenediamine) expected to start construction in Q4 2023[67].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公佈之內 容概不負責，對其準確性或完整性亦不發表任何聲明，並明確表示概不 就因本公佈全部或任何部份內容而產生或因倚賴該等內容而引致之任 何損失承擔任何責任。 玖 源 化 工（ 集 團 ）有 限 公 司 Ko Yo Chemical (Group) Limited （於開曼群島註冊成立之有限公司） （股份代號：00827） 截 至 二 零 二 二 年 十 二 月 三 十 一 日 止 年 度 全 年 業 績 公 佈 摘 要 — 截 至 二 零 二 二 年 十 二 月 三 十 一 日 止 年 度，營 運 資 金 變 動 及 支 付 利 得 稅 和 利 息 前 的 經 營 業 務 流 入 現 金 淨 額 約 人 民 幣823,000,000元，較 二零二一年的經營業務流入現金淨額約人民幣894,000,000元減少約 7.9%。 — 截 至 二 零 二 二 年 十 二 月 三 十 一 日 止 年 度，股 東 應 佔 溢 利 約 為 人 民 幣202,000,000元，較 二 零 二 一 年 溢 利 約 人 民 幣379,000,000元 減 少 溢 ...

Financial Measures - The company has taken measures to improve its financial situation, including the issuance of convertible bonds to alleviate financial pressure, completed on November 30, 2021 [4] - Proceeds from the convertible bonds will be allocated to the construction of multiple production lines, aiming to generate positive cash flow in the long term [5] - As of August 31, 2022, the company reached a settlement agreement with Dalian Bank to extend the repayment schedule for a loan with a remaining principal of RMB 69,600,000 [6] Auditor's Opinion - The auditor believes that the company's plans to improve financial conditions and cash flow can address the issues leading to the disclaimer of opinion [7] Liquidity and Cost Control - The company aims to continue taking proactive measures to enhance liquidity and control administrative and production costs [5]

Financial Performance - The group's unaudited revenue for the six months ended June 30, 2022, was approximately RMB 1,671,000,000, an increase of about 24.1% compared to the same period last year[2]. - The basic earnings per share for the six months ended June 30, 2022, was RMB 3.96, compared to RMB 2.81 for the same period last year[6]. - The group reported a net profit of RMB 226,432,000 for the six months ended June 30, 2022, an increase from RMB 153,999,000 in the previous year[6]. - The company reported a profit before tax of RMB 313,657,000 for the six months ended June 30, 2022, compared to RMB 159,261,000 for the same period in 2021, indicating a year-on-year increase of approximately 97%[26]. - Shareholders' profit attributable to the company reached approximately RMB 226,400,000, representing an increase of about RMB 72,400,000 or 47.0% from RMB 154,000,000 in the previous year[47]. Cash Flow and Liquidity - The net cash inflow from operating activities before tax and interest payments was approximately RMB 532,800,000, an increase of RMB 246,300,000 compared to RMB 286,500,000 in the same period last year[2]. - Operating cash flow before changes in working capital was RMB 532,751,000, significantly higher than RMB 286,512,000 in the previous year, reflecting improved cash generation capabilities[26]. - The net cash generated from operating activities after tax for the six months ended June 30, 2022, was RMB 659,678,000, compared to RMB 157,145,000 in the same period of 2021, marking a substantial increase[26]. - The cash and cash equivalents increased to RMB 571,626,000 as of June 30, 2022, from RMB 413,259,000 at the beginning of the year[14]. - The group reported cash and bank balances of approximately RMB 571,626,000 as of June 30, 2022, with no available bank credit facilities[85]. Assets and Liabilities - The total assets as of June 30, 2022, amounted to RMB 4,183,384,000, compared to RMB 4,037,708,000 as of December 31, 2021[8]. - The total liabilities as of June 30, 2022, were RMB 3,129,673,000, a decrease from RMB 3,214,120,000 as of December 31, 2021[9]. - As of June 30, 2022, the company had a net current liability of approximately RMB 1,005,831,000, with current assets including cash and bank deposits of about RMB 571,626,000[83]. - The capital debt ratio was 65% as of June 30, 2022, down from 72% as of December 31, 2021[86]. Sales and Production - The total sales volume (excluding trade) reached approximately 566,496 tons, a slight increase of 0.03% year-on-year[2]. - Urea sales contributed RMB 518,269,000, accounting for 31% of total revenue, while ammonia sales reached RMB 675,014,000, making up 40.4% of total revenue[23]. - The company's sales costs increased by approximately 9.4% to RMB 1,155,000,000, attributed to rising production costs[48]. - Distribution costs surged by approximately 88.8%, primarily due to increased transportation costs[48]. - The average monthly operating rate in the first half of 2022 was 73.85%, up by 0.18% year-on-year[57]. Market Conditions - The methanol market experienced fluctuations, with prices reaching a high of RMB 3,380 per ton before dropping to around RMB 2,600 per ton due to various external factors[54]. - The domestic methanol market is expected to show a trend of weakness followed by strength in the second half of 2022 due to improved supply-demand expectations[61]. - The synthetic ammonia market is projected to experience a trend of increase followed by decrease in the second half of 2022 due to seasonal demand fluctuations[67]. - The agricultural demand for urea is expected to be relatively weak in the second half of 2022, with a shift from weak to strong demand anticipated later in the year[74]. Operational Challenges and Strategies - The company faced challenges in natural gas supply during the heating season, impacting production capacity, but managed to maintain stable operations[51][53]. - The company plans to optimize existing operations and enhance management efficiency, focusing on cost reduction and increasing the proportion of direct sales customers[76]. - The company is focusing on internal reforms and innovations to navigate the challenges posed by the volatile fertilizer and chemical industry[76]. Future Projects and Developments - New projects include a 100,000-ton PBAT project expected to start production in Q4 2022, and a 300,000-ton/year dimethyl carbonate project that will complete all approval procedures within the year[80]. - The group has plans to establish three new production lines at its Dazhou, Guang'an, and Guang'an material factories, with the acquisition of the epoxy propane production line extended to September 30, 2022, for further testing[92]. Corporate Governance and Management - The audit committee has reviewed the financial reporting procedures and internal controls, ensuring compliance with accounting standards[123]. - The company has engaged in active negotiations with banks to restructure loans, indicating a proactive approach to financial management[120]. - The board is confident that the financial statements for the coming year will reflect improved conditions, potentially eliminating any audit opinion disclaimers[120].