中国淀粉(03838) - 2025 - 中期业绩

Corporate Information and Announcements Disclaimer The Hong Kong Exchanges and Clearing Limited disclaims responsibility for this announcement's content and any loss arising from reliance upon it[1] Corporate Information China Starch Holdings Limited (Stock Code: 3838) announces its unaudited consolidated interim results for the six months ended June 30, 2025[2][3] Consolidated Financial Statements Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the Group's revenue decreased by 9.4% to RMB 5.115 billion, with profit for the period declining by 15.7% Key Data from Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 5,114,852 | 5,645,514 | -9.4% | | Cost of sales | (4,686,096) | (5,138,334) | -8.8% | | Gross profit | 428,756 | 507,180 | -15.4% | | Operating profit | 279,725 | 342,483 | -18.3% | | Profit before tax | 297,133 | 355,294 | -16.4% | | Profit and total comprehensive income for the period | 225,636 | 267,482 | -15.7% | | Profit attributable to owners of the Company | 151,390 | 214,659 | -29.5% | | Basic and diluted earnings per share (RMB) | 0.0254 | 0.0360 | -29.4% | Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets remained stable at RMB 6.96 billion while total liabilities decreased, indicating an optimized financial structure Key Data from Consolidated Statement of Financial Position | Metric | As at June 30, 2025 (RMB'000) | As at December 31, 2024 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Assets | | | | | Total non-current assets | 2,490,059 | 2,539,526 | -1.9% | | Total current assets | 4,469,492 | 4,419,363 | +1.1% | | Total assets | 6,959,551 | 6,958,889 | +0.01% | | Equity | | | | | Equity attributable to owners of the Company | 4,204,055 | 4,105,970 | +2.4% | | Non-controlling interests | 448,431 | 387,685 | +15.7% | | Total equity | 4,652,486 | 4,493,655 | +3.5% | | Liabilities | | | | | Total non-current liabilities | 214,568 | 306,648 | -30.0% | | Total current liabilities | 2,092,497 | 2,158,586 | -3.0% | | Total liabilities | 2,307,065 | 2,465,234 | -6.4% | - Borrowings under non-current liabilities were reduced to zero as of June 30, 2025, from RMB 59,267 thousand at the end of 2024[4] Notes to the Financial Statements Basis of Preparation The interim financial statements are prepared in accordance with HKAS 34 and the Listing Rules, using accounting policies consistent with the 2024 annual report - The condensed consolidated interim financial statements are prepared in accordance with the Listing Rules of The Stock Exchange of Hong Kong Limited and HKAS 34[6] - The statements are presented in RMB and prepared under the historical cost convention, as modified by the revaluation of certain financial assets and liabilities[6] Adoption of New/Revised Hong Kong Financial Reporting Standards (HKFRSs) The Group adopted an amendment to HKAS 21 in 2025, which had no material impact on its financial position or performance - The Group adopted the amendment to HKAS 21 "Lack of Exchangeability" in 2025[7] - The amendment did not have any impact on the Group's results and financial position[7] Segment Information The Group operates two segments, with upstream product performance declining significantly while fermentation and downstream product performance improved External Sales and Performance by Segment | Segment | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | External Sales | | | | | Upstream products | 3,149,725 | 3,524,090 | -10.7% | | Fermentation and downstream products | 1,965,127 | 2,121,424 | -7.4% | | Total | 5,114,852 | 5,645,514 | -9.4% | | Reportable Segment Performance | | | | | Upstream products | 5,607 | 98,337 | -94.3% | | Fermentation and downstream products | 295,113 | 255,951 | +15.3% | | Total | 300,720 | 354,288 | -15.1% | Other Net Income Other net income decreased by 13.9% to RMB 49.4 million, primarily due to an increased loss on the disposal of property, plant, and equipment Breakdown of Other Net Income | Item | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Amortisation of government grants | 37,530 | 38,977 | -3.7% | | Gain on sales of scrap materials | 12,855 | 14,611 | -12.0% | | Net foreign exchange gain | 2,644 | 4,265 | -38.0% | | Loss on disposal of property, plant and equipment | (6,216) | (512) | +1114.1% | | Government grants | 253 | 131 | +93.1% | | Gain on futures | – | 333 | -100.0% | | Others | 2,371 | (389) | +709.0% | | Total | 49,437 | 57,416 | -13.9% | Profit Before Tax The Group's profit before tax was RMB 297.1 million, with notable changes in major expenses including a significant decrease in research costs Breakdown of Major Expenses | Item | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Cost of inventories | 4,018,342 | 4,465,085 | -10.0% | | Salaries and other related expenses | 153,658 | 136,605 | +12.5% | | Depreciation of property, plant and equipment | 134,737 | 136,663 | -1.4% | | Depreciation of right-of-use assets | 5,185 | 5,185 | 0.0% | | Delivery and logistics | 46,767 | 65,622 | -28.7% | | Research expenses | 20,731 | 43,689 | -52.6% | - Research expenses include the cost of inventories, staff costs of the R&D department, and depreciation[10] Income Tax Expense Income tax expense decreased by 18.6% to RMB 71.5 million, mainly due to a reversal of deferred tax liabilities and over-provision in prior years Breakdown of Income Tax Expense | Item | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Current income tax - PRC Enterprise Income Tax | 80,797 | 45,298 | +78.4% | | Over-provision in prior years | (4,933) | – | N/A | | Deferred tax | (4,367) | 42,514 | -110.3% | | Total | 71,497 | 87,812 | -18.6% | - The enterprise income tax rate for PRC subsidiaries is 25%, with a preferential rate of 15% for high-tech enterprises[11] - The PRC withholding tax rate was reduced from 10% in 2024 to 5% in 2025[12] Earnings Per Share Basic earnings per share for the period decreased by 29.4% to RMB 0.0254, with no diluted EPS presented due to the absence of dilutive shares Calculation of Earnings Per Share | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Profit attributable to owners of the Company (RMB'000) | 151,390 | 214,659 | -29.5% | | Weighted average number of ordinary shares in issue ('000) | 5,964,492 | 5,965,532 | -0.02% | | Basic earnings per share (RMB) | 0.0254 | 0.0360 | -29.4% | - No diluted earnings per share was presented as there were no potential dilutive ordinary shares in either period[13] Dividends The Board does not recommend an interim dividend for the first half of 2025, but a final dividend for 2024 was approved in May 2025 - The Board does not recommend the payment of an interim dividend for H1 2025 (H1 2024: Nil)[14] - On May 20, 2025, shareholders approved a final dividend of HK 0.98 cents per share for 2024 (2023: HK 0.69 cents)[14] Trade and Other Receivables Total trade and other receivables increased by 22.1% to RMB 535.3 million, driven by higher trade receivables and prepayments Breakdown of Trade and Other Receivables | Item | As at June 30, 2025 (RMB'000) | As at December 31, 2024 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Trade receivables | 157,110 | 82,970 | +89.4% | | Bills receivable - bank acceptance | 274,145 | 280,774 | -2.4% | | Prepayments and other tax receivables | 94,217 | 52,993 | +77.8% | | Others | 9,853 | 21,602 | -54.3% | | Total | 535,325 | 438,339 | +22.1% | Ageing Analysis of Trade Receivables | Ageing | As at June 30, 2025 (RMB'000) | As at December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | 0 to 30 days | 152,266 | 75,434 | | 31 to 60 days | 4,844 | 7,190 | | 61 to 90 days | – | 346 | | Total | 157,110 | 82,970 | - The Group generally grants a credit period of 0 to 150 days to its customers[15] Trade and Other Payables Total trade and other payables decreased by 4.3% to RMB 345.3 million, mainly due to the settlement of notes payable and lower other tax payables Breakdown of Trade and Other Payables | Item | As at June 30, 2025 (RMB'000) | As at December 31, 2024 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Trade payables | 154,180 | 157,694 | -2.2% | | Notes payable | – | 2,000 | -100.0% | | Payables for construction and equipment | 56,335 | 60,639 | -7.0% | | Salaries and welfare payables | 48,978 | 43,806 | +11.8% | | Accrued expenses | 32,878 | 42,555 | -22.7% | | Other tax payables | 12,876 | 24,665 | -47.8% | | Tender deposits | 31,982 | 20,757 | +54.1% | | Total | 345,263 | 360,653 | -4.3% | Ageing Analysis of Trade and Notes Payables | Ageing | As at June 30, 2025 (RMB'000) | As at December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | 0 to 60 days | 133,346 | 134,654 | | 61 to 90 days | 1,120 | 2,164 | | Over 90 days | 19,714 | 22,876 | | Total | 154,180 | 159,694 | - The average credit period for purchases is 80 days[18] Management Discussion and Analysis Industry Overview and Corporate Development The Group faced economic headwinds, intense market competition, and margin pressure from rising corn costs but maintains a stable financial position - In H1 2025, the domestic economy faced challenges with sluggish demand and ongoing Sino-US trade disputes, leading to market oversupply and downward price pressure[20] - The corn starch and deep processing industry saw stable capacity but faced intensified competition from low-cost imported tapioca starch and weak demand from the feed and breeding sectors[20] - Domestic corn prices rose steadily, but prices for corn starch and related products remained low due to weak demand, leading to margin contraction[21] - The Group's financial position remains stable with sufficient funds, and management has adopted a prudent strategy to control costs and improve operational efficiency[21] - The Linqing production base expansion project was delayed until early August due to permit approvals but is not expected to affect the 2026 trial production schedule[21] - The expansion project involved dismantling existing facilities, resulting in a higher loss on disposal of obsolete equipment in H1, with no significant further losses expected in H2[22] Business Review The upstream segment faced multiple pressures while the downstream segment saw improved gross profit despite lower revenue, driven by strategic shifts - Upstream products (corn starch) faced pressure from rising corn kernel prices due to lower imports, falling prices of substitutes like wheat/tapioca starch, and industry capacity expansion[23] - The fermentation and downstream products segment saw an overall revenue decline but improved gross profit through strategic adjustments and solid performance of new bio-based materials[24] - The lysine business strategically shifted its sales focus from overseas to domestic channels due to an anti-dumping investigation in China[24] - The starch sugar business faced challenges from weak demand in the catering industry and intensified competition from industry capacity expansion, pressuring profitability[24] - The modified starch business experienced a significant decrease in sales volume, mainly due to stricter wastewater control measures[24] - The new bio-based materials business performed satisfactorily, achieving growth by expanding its distribution network, attracting new customers, and launching new products[24] Financial Performance The Group's revenue and gross profit declined by 9.4% and 15.4% respectively, pressured by lower sales volume and rising raw material costs - The Group's revenue decreased to RMB 5,114,852,000 (down 9.4% YoY), mainly due to a decline in both average selling prices and total sales volume[25] - A significant increase in the market price of corn kernels (the main raw material) led to a decrease in gross profit to RMB 428,756,000 (down 15.4% YoY), putting significant pressure on profit margins[25] - Profit before tax was RMB 297,133,000 (down 16.4% YoY), and profit after tax was RMB 225,636,000 (down 15.7% YoY)[25] Segment Performance: Upstream Products The upstream product segment's revenue and gross margin fell significantly due to rising corn costs, reduced demand, and competition from substitutes Upstream Products Segment Performance | Metric | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 3,149,725 | 3,524,090 | -10.6% | | Gross Profit | 91,475 | 198,370 | -53.9% | | Gross Profit Margin | 2.9% | 5.6% | -2.7 p.p. | - Corn starch sales volume was approximately 856,500 tonnes (2024: 891,288 tonnes), with an average selling price of approximately RMB 2,465 per tonne (2024: RMB 2,679 per tonne)[26] - Profitability was mainly affected by a significant increase in corn kernel costs, reduced market demand, and intensified competition from substitutes[26] Segment Performance: Fermentation and Downstream Products The fermentation and downstream segment's revenue decreased by 7.4%, but its gross margin improved due to strategic adjustments and product mix changes Fermentation and Downstream Products Segment Performance | Metric | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 1,965,127 | 2,121,424 | -7.4% | | Gross Profit | 337,281 | 308,810 | +9.2% | | Gross Profit Margin | 17.2% | 14.6% | +2.6 p.p. | Revenue Breakdown of Fermentation and Downstream Products | Product | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Lysine | 1,553,051 | 1,605,963 | -3.3% | | Starch sugar | 222,607 | 247,926 | -10.3% | | Modified starch | 110,250 | 216,954 | -49.2% | | Others (incl. new bio-based materials) | 79,219 | 50,581 | +56.6% | - Domestic sales volume of lysine increased to 247,596 tonnes (2024: 227,549 tonnes), while total sales volume rose slightly to approximately 275,187 tonnes (2024: 273,256 tonnes), with the average selling price decreasing to RMB 5,644 per tonne (2024: RMB 5,877 per tonne)[28] - Both sales volume and average selling price of starch sugar decreased, with the proportion of liquid starch sugar rising to 81.7%, leading to a lower overall average selling price[28] - Revenue from new bio-based materials and other products grew by 56.6%, mainly benefiting from an enhanced distribution network[29] Cost of Sales Total cost of sales decreased by 8.8% to RMB 4.69 billion, with the average purchase cost of corn kernels being lower than the prior period - Total cost of sales was approximately RMB 4,686,096,000, a year-on-year decrease of 8.8%[30] - The average purchase cost of corn kernels (net of VAT) was approximately RMB 2,068 per tonne, lower than H1 2024 (RMB 2,135) but higher than the H2 2025 forecast (RMB 2,040)[30] - The Group did not enter into any forward/futures contracts to hedge against corn kernel price fluctuations during the period[30] Other Operational Review The Group saw significant changes in operating expenses, with distribution and research costs decreasing while administrative expenses increased Distribution and Administrative Expenses Distribution expenses fell by 22.6% due to lower sales volume, while administrative expenses rose by 18.5% driven by higher government levies Breakdown of Distribution Expenses | Item | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Delivery and logistics | 46,767 | 65,622 | -28.7% | | Marketing expenses | 7,604 | 7,817 | -2.8% | | Staff costs | 5,624 | 5,116 | +9.9% | | Others | 3,709 | 3,663 | +1.3% | | Total | 63,704 | 82,218 | -22.6% | Breakdown of Administrative Expenses | Item | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Staff costs | 60,077 | 52,629 | +14.1% | | Government levies | 22,147 | 13,434 | +64.9% | | Depreciation and amortisation | 18,090 | 17,677 | +2.3% | | Others | 13,719 | 12,466 | +10.1% | | Total | 114,033 | 96,206 | +18.5% | Research Expenses Research expenses decreased substantially by 52.6% as the Group focused on developing production technology and proprietary techniques - Research expenses decreased significantly by 52.6% from RMB 43,689,000 to RMB 20,731,000[34] - These expenses, mainly comprising material costs, depreciation, and staff costs, were focused on the development of production technology and proprietary techniques[34] Other Net Income Other net income decreased by 13.9% to RMB 49.4 million, mainly due to a significant loss on the disposal of equipment at the Linqing plant Breakdown of Other Net Income | Item | For the six months ended June 30, 2025 (RMB'000) | For the six months ended June 30, 2024 (RMB'000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Amortisation of government grants | 37,530 | 38,977 | -3.7% | | Gain on sales of scrap materials | 12,855 | 14,611 | -12.0% | | Net exchange gain | 2,644 | 4,265 | -38.0% | | Loss on disposal of property, plant and equipment | (6,216) | (512) | +1114.1% | | Government grants (one-off) | 253 | 131 | +93.1% | | Gain on futures | – | 333 | -100.0% | | Others | 2,371 | (389) | +709.0% | | Total | 49,437 | 57,416 | -13.9% | - The decrease in other net income was mainly due to the loss on disposal arising from the dismantling of certain equipment at the Linqing production plant[35] Liquidity, Financial Resources, and Capital Structure The Group maintained sufficient working capital and a sound financial structure, with a lower gearing ratio and slightly changed liquidity ratios Key Financial Performance Indicators | Metric | As at June 30, 2025 | As at December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Accounts receivable turnover (days) | 14 | 12 | +2 days | | Accounts payable turnover (days) | 8 | 5 | +3 days | | Inventory turnover (days) | 28 | 24 | +4 days | | Current ratio (times) | 2.1 | 2.0 | +0.1 | | Quick ratio (times) | 1.7 | 1.8 | -0.1 | | Gearing ratio - borrowings to total assets (%) | 20.1 | 21.3 | -1.2 p.p. | - The Group has sufficient working capital to meet its current requirements, and all borrowings are short-term[37] - Total bank borrowings of RMB 1,337,864,000 are at fixed interest rates, and a loan from a controlling shareholder of RMB 61,101,000 is at a fixed annual rate of 0.5%[37] Human Resources and Remuneration Policy The Group reduced its headcount but increased total staff costs, implementing measures to optimize labor efficiency and retain talent - As of June 30, 2025, the Group employed 2,073 staff (2024: 2,267), a decrease in headcount[38] - Total staff costs (including directors' remuneration) were approximately RMB 153,658,000, a year-on-year increase of 12.5%[38] - To cope with operational challenges, the Group implemented measures to optimize labor efficiency, support staff retention, increase reliance on automation, and introduce discretionary performance bonuses[38] - The remuneration review during the period involved an in-depth assessment, resulting in a significant adjustment to enhance morale and maintain market competitiveness[38] Financial Management, Treasury Policy, and Foreign Exchange Risk There were no material changes to the Group's financial management, treasury policies, or foreign exchange risk exposure compared to the 2024 annual report[39] Pledge of Assets As of June 30, 2025, the Group pledged bank deposits and bills receivable totaling RMB 1.138 billion as security for certain banking facilities - As of June 30, 2025, the Group pledged bank deposits and bills receivable with a total carrying value of RMB 1,138,000,000 as security for banking facilities[40] - No land use rights or buildings were pledged as security for banking facilities during the period[40] Contingent Liabilities The Group had no significant contingent liabilities as of June 30, 2025[41] Material Investments The Group had no material investments or future plans for significant capital asset investments beyond its disclosed business development plans[42] Other Disclosures Interim Dividend The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: Nil)[43] Purchase, Sale, or Redemption of the Company's Listed Securities Neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the period[44] Corporate Governance The Company complied with the applicable code provisions of the Listing Rules, with the exception of the Chairman's absence from the 2025 AGM - The Company has complied with the applicable code provisions contained in Part 2 of Appendix C1 to the Listing Rules[45] - The Chairman, Mr Tian Qixiang, was unable to attend the 2025 Annual General Meeting due to other business engagements[45] Review of Interim Financial Statements The Audit Committee has reviewed the unaudited condensed consolidated interim financial statements for the six months ended June 30, 2025[46] Interim Report The 2025 Interim Report will be published on the websites of the HKEX and the Company by the end of September 2025[47]