中国心连心化肥(01866) - 2025 - 中期业绩

Financial Statements Condensed Consolidated Statement of Profit or Loss For the first half of 2025, the Group's revenue increased by 5.0% year-on-year to RMB 12.67 billion, but gross profit decreased by 13.4% due to faster growth in cost of sales, leading to a 19.3% decline in profit for the period and a 12.8% decrease in profit attributable to owners of the parent 2025 H1 Key Profit or Loss Data | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 12,665,749 | 12,060,957 | +5.0% | | Gross Profit | 2,040,184 | 2,355,720 | -13.4% | | Profit Before Tax | 918,518 | 1,122,610 | -18.2% | | Profit for the Period | 757,116 | 938,486 | -19.3% | | Profit Attributable to Owners of the Parent | 599,295 | 686,996 | -12.8% | | Basic Earnings Per Share (RMB cents) | 51.50 | 56.4 | -8.7% | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets increased by 10.8% from the end of 2024 to RMB 36.04 billion, primarily driven by an increase in property, plant, and equipment, while total liabilities increased by 14.5% to RMB 22.90 billion, mainly due to an increase in non-current interest-bearing borrowings, resulting in net assets growing by 4.9% to RMB 13.14 billion Key Balance Sheet Data as of June 30, 2025 | Indicator | June 30, 2025 (RMB thousands) | Dec 31, 2024 (RMB thousands) | Period Change | | :--- | :--- | :--- | :--- | | Total Non-current Assets | 28,256,258 | 26,217,520 | +7.8% | | Total Current Assets | 7,785,057 | 6,300,724 | +23.6% | | Total Assets | 36,041,315 | 32,518,244 | +10.8% | | Total Current Liabilities | 11,126,855 | 11,367,961 | -2.1% | | Total Non-current Liabilities | 11,772,334 | 8,628,495 | +36.4% | | Total Liabilities | 22,899,189 | 19,996,456 | +14.5% | | Net Assets | 13,142,126 | 12,521,788 | +4.9% | Condensed Consolidated Statement of Changes in Equity During the period, total equity increased from RMB 12.52 billion at the beginning of the year to RMB 13.14 billion, primarily driven by profit for the period of RMB 757 million, partially offset by dividends paid to non-controlling shareholders (RMB 122 million) and share repurchases (RMB 4.84 million) - Total equity increased by approximately RMB 620 million during the period, primarily contributed by current period profit[7] - The company conducted share repurchases, costing approximately RMB 4.84 million[7] Notes to the Condensed Consolidated Interim Financial Information Product Performance Contribution By product, the fertilizer segment (urea and compound fertilizer) contributed the majority of revenue and profit, with urea remaining the largest profit source despite a significant year-on-year decline in segment profit, while in the chemical segment, methanol revenue grew significantly, and other products performed steadily or slightly declined H1 2025 Performance by Product Segment | Product Segment | Revenue (RMB thousands) | Segment Profit (RMB thousands) | | :--- | :--- | :--- | | Urea | 3,225,357 | 662,636 | | Compound Fertilizer | 3,566,305 | 563,356 | | Methanol | 1,641,974 | 138,724 | | Liquid Ammonia | 533,249 | 69,437 | | Melamine | 377,812 | 116,775 | | DMF | 587,071 | 108,294 | | Others | 2,733,981 | 380,962 | | Total | 12,665,749 | 2,040,184 | - Compared to the same period last year, urea segment profit significantly decreased from RMB 1.18 billion to RMB 660 million, which is the primary reason for the Group's overall profit decline[16][19] Notes on Key Financial Items This section details the composition and changes of key financial items including revenue, expenses, dividends, borrowings, and gearing ratio, noting that finance costs decreased year-on-year, total interest-bearing borrowings increased but with optimized structure, and the gearing ratio slightly rose to 63.5% Dividends During the period, the company declared a final dividend for the year ended December 31, 2024, totaling RMB 334 million, with no interim dividend proposed or declared for the six months ended June 30, 2025 - Final dividend for 2024 of RMB 333,643,000 has been distributed[28] - No interim dividend proposed for 2025[28] Interest-bearing Bank and Other Borrowings As of the end of the period, total interest-bearing borrowings were RMB 15.53 billion, a significant increase from RMB 12.86 billion at the beginning of the period, with the Group actively optimizing its debt structure by improving the long-term to short-term borrowing ratio from 6:4 to 7:3, increasing the proportion of medium and long-term loans to reduce short-term repayment pressure Interest-bearing Borrowings Structure | Item | June 30, 2025 (RMB thousands) | Dec 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Current Borrowings | 4,858,594 | 5,267,226 | | Non-current Borrowings | 10,673,109 | 7,588,086 | | Total | 15,531,703 | 12,855,312 | - The Group optimized its debt structure by increasing medium and long-term project loans, adjusting the long-term to short-term borrowing ratio from 6:4 to 7:3, to match project construction cycles and alleviate short-term funding pressure[44] Gearing Ratio As of the end of the first half of 2025, the Group's gearing ratio was 63.5%, an increase of 2 percentage points from 61.5% at the beginning of the year, primarily due to new medium and long-term loans of approximately RMB 2.67 billion to meet project construction needs - Gearing ratio (total liabilities/total assets) increased from 61.5% to 63.5%[45] - The increase in gearing ratio was mainly due to new medium and long-term loans to support project construction; the company expects cash flow to improve and the gearing ratio to stabilize after the Jiangxi Phase II project commences operation[45] Management Discussion and Analysis Business Review In the first half of 2025, despite a decline in gross profit due to falling product prices, the Group achieved a 5% year-on-year revenue increase through new capacity deployment and market expansion, with Q2 performance significantly rebounding quarter-on-quarter, showing a positive trend with gross profit up 44% and net profit up 104% - H1 revenue increased by 5% year-on-year to approximately RMB 12.67 billion, but net profit attributable to owners of the parent decreased by 13% year-on-year (down 9% after non-recurring items)[46] - The decline in performance was mainly due to product price decreases exceeding cost reductions, with urea gross profit decreasing by nearly 44% year-on-year, being the primary drag[46] - Q2 performance significantly improved quarter-on-quarter, with gross profit increasing by 44% and net profit growing by 104%, driven by both selling prices and sales volume[47] Segment Performance Analysis In the fertilizer segment, urea revenue decreased by 16% due to price declines, but sales volume increased by 4%, while compound fertilizer revenue grew by 5% benefiting from new capacity; in the chemical segment, methanol performed strongly with a 27% revenue increase, and melamine and DMF achieved sales volume growth by expanding markets, partially offsetting the impact of price declines Fertilizer Segment Urea business revenue declined by 16% due to a 19% year-on-year decrease in selling price, with gross margin falling to 21%, though the company reduced production costs by 7% through technical optimization and procurement strategies; compound fertilizer business revenue grew by 5% driven by an 8% increase in sales volume due to the Guangxi base commissioning, but rising raw material costs reduced gross margin to 16% - Urea: Revenue decreased by 16% year-on-year due to a 19% decline in average selling price. The company actively expanded overseas markets, driving an increase in export volume, supporting a 4% year-on-year growth in total sales volume. Gross margin decreased from 31% to 21%[48] - Compound Fertilizer: Revenue increased by 5% year-on-year due to an 8% increase in sales volume. The Guangxi base commissioning expanded coverage to the South China market, with high-efficiency fertilizer sales volume increasing by 11% year-on-year. Gross margin decreased from 18% to 16% due to rising raw material costs[49] Chemical Segment Methanol benefited from market improvement and increased foreign trade volume, with sales volume up 28% and revenue up 27%; liquid ammonia sales and revenue both decreased due to the company's 'prioritize methanol, reduce ammonia' strategy; melamine and DMF, despite falling prices, achieved sales volume growth of 5% and 9% respectively by expanding overseas markets and collaborating with leading enterprises, and improved gross margins through cost control - Methanol: Sales volume increased by 28% year-on-year, driving a 27% increase in revenue, with gross margin stable at 8%[50][51] - Liquid Ammonia: Revenue decreased by 20% year-on-year due to the company's 'prioritize methanol, reduce ammonia' strategy leading to reduced self-production. Gross margin benefited from cost reduction, increasing from 11% to 13%[52] - Melamine: Revenue decreased by 5% year-on-year due to a 9% decline in selling price, but sales volume increased by 5%. Through expanding into the EU market and cost control, gross margin increased from 30% to 31%[53] - DMF: Revenue slightly decreased by 1% year-on-year due to a 9% decline in selling price, but sales volume increased by 9%. Through technical transformation to reduce costs, gross margin significantly increased from 13% to 18%[54] Analysis of Expenses and Other Income During the period, net other income significantly increased by 79% year-on-year, mainly from government grants and byproduct sales, while selling expenses increased by 4% due to expanded sales volume, general and administrative expenses (excluding share-based payment expenses) actually decreased by 5% year-on-year, and finance costs significantly decreased by 14% due to optimized debt structure and lower interest rates - Other Income, Net: Increased by 79% year-on-year to RMB 200 million, mainly due to increased government grants and net profit from byproduct sales[55] - Selling and Distribution Expenses: Increased by 4% year-on-year, mainly due to increased handling and freight inspection service fees resulting from higher sales volume and overseas market development[56] - General and Administrative Expenses: Slightly decreased by 0.3% year-on-year. Excluding RMB 35 million in share-based payment expenses, actual administrative expenses decreased by 5% year-on-year, benefiting from organizational streamlining and optimized equipment maintenance[57] - Finance Costs: Decreased by 14% year-on-year to RMB 230 million, mainly due to the Group optimizing its debt structure and replacing high-interest loans, leading to a 0.8 percentage point decrease in average loan interest rate[59] Outlook Looking ahead to the second half, the company expects urea prices to remain stable and the chemical industry's prosperity to improve, with the Group adhering to its strategy of 'fertilizer as foundation, high-quality development,' focusing on high-efficiency fertilizers and cost advantages, as several ongoing projects are scheduled to commence operation, with full capacity release expected by 2027, bringing long-term value growth to the Group - The company's strategic core is to be an 'advocate for high-efficiency fertilizers in China,' focusing on R&D of slow-release and controlled-release technologies, and providing full-chain agricultural services with humic acid as the core product[62][63] - Construction projects are progressing steadily: Jiangxi Base Phase II project is expected to commence operation in Q3 this year, and Xinxiang Base Chemical New Materials project in Q1 next year[63] - By 2027, all of the Group's ongoing capacities are expected to be fully released, at which point cash flow will significantly exceed capital expenditures, forming a positive cycle of 'investment, output, and development'[63] Risk Management and Other Disclosures Operational and Financial Risks The Group faces key risks including market risks (product selling price and raw material cost fluctuations), interest rate risk, liquidity risk, and gearing ratio risk, which the company manages by monitoring cash positions, adjusting the long-term to short-term loan structure, and adapting its asset-liability structure based on economic conditions - Key market risks include fluctuations in average product selling prices, raw material (primarily coal) costs, and interest rate volatility[64] - Liquidity risk management: The Group manages liquidity risk by adjusting its loan structure; as of the end of the period, the proportion of debt due within one year decreased from 40.97% to 31.28%[69] - Gearing ratio risk: The Group monitors its gearing ratio, which was 63.5% at the end of the period[70] Corporate Governance and Other Information The company confirmed compliance with all corporate governance code provisions during the reporting period, repurchasing 1,006,000 shares for approximately HKD 5.32 million to demonstrate confidence in business prospects and optimize capital structure, with the Group having 11,945 employees as of the period end - The company repurchased 1,006,000 shares on the Stock Exchange during the period for a total consideration of approximately HKD 5.318 million, with repurchased shares intended for employee share incentive schemes and other purposes[76][78][79] - As of June 30, 2025, the Group had 11,945 employees, a slight increase from 11,787 at the end of 2024[80]