泸天化(000912) - 2025 Q2 - 季度财报

Important Notice, Table of Contents, and Definitions This section provides the important notice, table of contents, and definitions of key terms used throughout the report Important Notice The Board of Directors, directors, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report content, assuming legal responsibility - The company's Board of Directors, directors, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report content, assuming legal responsibility[4] - Company head Liao Tingjun, chief accountant Wang Bin, and head of accounting department Li Chun declare the financial report is true, accurate, and complete[4] - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital[4] Catalogue of Reference Documents Reference documents for this reporting period include signed and sealed financial statements and original announcements disclosed on the CSRC-designated website - Reference documents include financial statements signed and sealed by the company's head, chief accountant, and head of the accounting department[8] - Reference documents also include the originals and announcements of all company documents publicly disclosed on the CSRC-designated website during the reporting period[8] Definitions This section defines common terms used in the report, such as Company, Lutianhua Group, Luzhou Development, Reporting Period, SZSE, CSRC, Hening Chemical, Jiuhe Shares, Import & Export Company, Agricultural Company, Hongtu Company, and Yicheng Company Major Definitions | Term | Definition | | :--- | :--- | | Company, The Company | Sichuan Lutianhua Co., Ltd | | Lutianhua Group | Lutianhua (Group) Co., Ltd | | Luzhou Development | Luzhou Industrial Development Investment Group Co., Ltd | | Reporting Period | First half of 2025 | | SZSE | Shenzhen Stock Exchange | | CSRC | China Securities Regulatory Commission | | Hening Chemical | Ningxia Hening Chemical Co., Ltd | | Jiuhe Shares | Jiuhe Co., Ltd | | Import & Export Company | Sichuan Lutianhua Import & Export Trading Co., Ltd | | Agricultural Company | Sichuan Lutianhua Agricultural Technology Service Co., Ltd | | Hongtu Company | Sichuan Lutianhua Hongtu Engineering Design Co., Ltd | | Yicheng Company | Luzhou Yicheng Automobile Trade Co., Ltd | Company Profile and Key Financial Indicators This section provides an overview of the company, its contact information, and key financial performance metrics for the reporting period Company Profile Sichuan Lutianhua Co., Ltd., with stock abbreviation "Lutianhua" and code 000912, is listed on the Shenzhen Stock Exchange, with Liao Tingjun as its legal representative Company Basic Information | Indicator | Content | | :--- | :--- | | Stock Abbreviation | Lutianhua | | Stock Code | 000912 | | Listed Stock Exchange | Shenzhen Stock Exchange | | Chinese Name | 四川泸天化股份有限公司 | | Legal Representative | Liao Tingjun | Contact Person and Contact Information The company's Board Secretary is Wang Bin and Securities Affairs Representative is Li Chun, both located at Sichuan Lutianhua Co., Ltd., Luzhou City, Sichuan Province, with provided contact numbers and email addresses Contact Information | Position | Name | Contact Address | Phone | Email | | :--- | :--- | :--- | :--- | :--- | | Board Secretary | Wang Bin | Sichuan Lutianhua Co., Ltd., Luzhou City, Sichuan Province | 0830-4122575 | lthwbb@126.com | | Securities Affairs Representative | Li Chun | Sichuan Lutianhua Co., Ltd., Luzhou City, Sichuan Province | 0830-4120687 | 329761709@qq.com | Other Information During the reporting period, there were no changes in the company's contact information, information disclosure, or other relevant materials - The company's registered address, office address, postal code, website, and email address remained unchanged during the reporting period[14] - Information disclosure and storage locations remained unchanged during the reporting period[14] - Other relevant information remained unchanged during the reporting period[14] Key Accounting Data and Financial Indicators In the first half of 2025, the company's operating revenue decreased by 13.45% year-on-year, net profit attributable to shareholders significantly dropped by 65.55%, and net cash flow from operating activities sharply declined by 98.51% Key Accounting Data and Financial Indicators for H1 2025 | Indicator | Current Period (RMB) | Prior Year Period (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | Operating Revenue | 2,378,804,908.52 | 2,748,552,231.75 | -13.45% | | Net Profit Attributable to Shareholders of Listed Company | 46,102,567.96 | 133,842,477.11 | -65.55% | | Net Profit Attributable to Shareholders of Listed Company (Excluding Non-recurring Gains/Losses) | 10,358,470.42 | 63,098,589.19 | -83.58% | | Net Cash Flow from Operating Activities | 4,871,847.14 | 327,444,444.91 | -98.51% | | Basic Earnings Per Share (RMB/share) | 0.03 | 0.09 | -66.67% | | Diluted Earnings Per Share (RMB/share) | 0.03 | 0.09 | -66.67% | | Weighted Average Return on Net Assets | 0.71% | 2.05% | -1.34% | | Period-End Indicators | Current Period-End (RMB) | Prior Year-End (RMB) | Period-End vs. Prior Year-End Change | | Total Assets | 9,260,429,068.88 | 10,219,298,716.97 | -9.38% | | Net Assets Attributable to Shareholders of Listed Company | 6,423,743,139.33 | 6,373,725,760.72 | 0.78% | Differences in Accounting Data under Domestic and Overseas Accounting Standards The company reports no differences in net profit and net assets between financial statements prepared under international or overseas accounting standards and Chinese accounting standards - The company reports no differences in net profit and net assets between financial statements disclosed under international accounting standards and Chinese accounting standards[16] - The company reports no differences in net profit and net assets between financial statements disclosed under overseas accounting standards and Chinese accounting standards[16] Non-recurring Gains and Losses and Amounts During the reporting period, the company's total non-recurring gains and losses amounted to 35.74 million RMB, primarily from disposal of non-current assets, government grants, fair value changes of financial assets/liabilities, and other non-operating income/expenses Non-recurring Gains and Losses and Amounts | Item | Amount (RMB) | | :--- | :--- | | Gains or losses from disposal of non-current assets | 356,994.08 | | Government grants recognized in current profit or loss | 15,585,646.05 | | Gains or losses from changes in fair value of financial assets and liabilities, and investment income from disposal of financial assets and liabilities, excluding effective hedging activities related to normal business operations | 13,758,965.91 | | Other non-operating income and expenses apart from the above | 14,269,467.07 | | Less: Income tax impact | 8,219,695.60 | | Less: Impact on minority interests (after tax) | 7,279.97 | | Total | 35,744,097.54 | Management Discussion and Analysis This section provides an in-depth analysis of the company's main business operations, core competencies, financial performance, and risk management strategies Company's Main Business Activities During the Reporting Period The company's main business encompasses the production and sale of fertilizers like urea and compound fertilizers, as well as chemical products such as liquid ammonia, methanol, and nitric acid, maintaining strong market presence in Southwest China - The company's main business includes the production and sale of fertilizer products such as urea and compound fertilizers, as well as chemical products such as liquid ammonia, methanol, liquid ammonium nitrate, concentrated nitric acid, dilute nitric acid, dinitrogen tetroxide, and automotive urea[24] - The fertilizer industry is undergoing product transformation and upgrading, characterized by differentiated competition, green and low-carbon products, and enhanced industrial chain advantages[19] - The non-fertilizer chemical industry is in a development stage of product transformation and upgrading, shifting from basic chemicals to fine chemicals, with increasing refinement[19] - The company maintains a high market share and product influence in its traditional advantageous markets in Southwest China, with products like synthetic ammonia, ammonium nitrate, and nitric acid serving as price benchmarks for surrounding regional markets[30] (I) Industry Development During the Reporting Period The fertilizer industry is undergoing product transformation and differentiated competition, emphasizing green and low-carbon practices, while the non-fertilizer chemical sector is moving towards fine chemicals with improved quality and processes - The fertilizer industry is in a stage of product transformation and upgrading, with differentiated competition, where green and low-carbon environmental products are widely recognized, and forward-integrated companies' industrial chain advantages are further highlighted[19] - The non-fertilizer chemical industry is shifting towards fine chemicals, with strict quality requirements for front-end semi-finished products from end consumers, prompting enterprises to transform, upgrade, improve processes, and reduce costs[19] - In the first half of 2025, the urea industry experienced a tight supply-demand balance, with prices initially rising then falling, coal-based enterprises improving profitability, gas-based enterprises expanding losses, and exports being restricted[20] - In the first half of 2025, the compound fertilizer industry saw capacity expansion, but utilization rates were only 34.49% (a 3.51% year-on-year decrease), and export volumes decreased by 69.18% year-on-year, with the industry shifting towards precision fertilization and environmentally friendly products[21] - In the first half of 2025, the methanol industry accelerated domestic substitution, with production increasing by 12% year-on-year, but downstream demand for olefins slowed, and policies promoted the industry's green and intensive transformation[23] (II) Company's Main Business During the Reporting Period The company's main business involves the production and sale of various fertilizer products, including urea and compound fertilizers, and chemical products such as liquid ammonia, methanol, and nitric acid - The company's main business includes the production and sale of fertilizer products such as urea and compound fertilizers, as well as chemical products such as liquid ammonia, methanol, liquid ammonium nitrate, concentrated nitric acid, dilute nitric acid, dinitrogen tetroxide, and automotive urea[24] (III) Company's Main Products and Their Uses During the Reporting Period The company's key products include urea for agriculture and industry, compound fertilizers for agricultural use, and methanol as a vital organic chemical raw material and fuel - Urea is primarily used as agricultural fertilizer and industrial raw material, mainly for direct application in agriculture and compound fertilizer production, and industrially for melamine and urea-formaldehyde glue production[25] - Compound fertilizers are mainly for direct agricultural use, aiming to balance crop nutrient demand with soil supply, improving fertilizer utilization and crop yield[25] - Methanol is an important organic chemical raw material, widely used in the production of olefins, formaldehyde, dimethyl ether, and also serves as an excellent energy source and automotive fuel[26] (IV) Company's Business Model During the Reporting Period The company operates with independent procurement, production, and marketing systems, maintaining continuous fertilizer and chemical production, guided by a market- and customer-centric approach, supported by robust R&D platforms and collaborations - The company possesses independent and complete procurement, production, and marketing systems, with continuous and uninterrupted operation for fertilizer and chemical production[29] - The company has established a comprehensive sales, logistics, and after-sales service system and procedures, providing pre-sales, in-sales, and after-sales services[29] - The company owns national-level technology centers, postdoctoral research workstations, and other R&D platforms, and has signed strategic cooperation agreements with multiple domestic research institutes and universities to promote knowledge sharing and technology transfer[29] (V) Company's Market Position During the Reporting Period The company aims to build a nationally renowned brand, leveraging its complete chemical product value chain and professional marketing team to maintain a high market share and influence in Southwest China - The company is committed to building a well-known brand in Southwest China and nationwide, strengthening brand influence through brand strategy, internal management system construction, and high-quality agricultural technical services[30] - The company has passed environmental and ecological product certification for "Lutianhua" and "Gongnong Brand Urea," enjoying a high reputation in Southwest China and across the country[30] - The company's chemical product industrial chain is complete, with a professional marketing management team capable of flexibly adjusting production based on market conditions, maintaining a high market share and product influence in traditional advantageous markets in Southwest China[30] (VI) Company's Main Performance Drivers During the Reporting Period The company's performance is primarily driven by cost, output, sales volume, selling price, and safety production status, with management focusing on employee incentives, quality control, market trends, and execution to enhance results - The main variables determining the company's performance are cost, output, sales volume, selling price, and safety production status[31] - The process technology and production management level of production facilities determine the direct cost and output of the company's products; internal energy saving, consumption reduction, and cost control determine management costs[31] - The company's management relies on employee incentives, strict product quality control, accurate grasp of upstream and downstream market trends to hedge price risks, and improved institutional execution to drive cost reduction, increased output and sales, stable selling prices, and excellent safety production, indirectly driving company performance[31] Core Competitiveness Analysis The company's core competitiveness stems from its strong brand, integrated industrial chain, extensive marketing network and services, and continuous innovation capabilities - The company is recognized as the "cradle of modern urea industry in China" and owns the "Gongnong" brand urea, a "China Famous Brand," leveraging its integrated "ammonia, acid, alcohol, fertilizer, hydrogen" industrial chain for optimized production and resource efficiency[32][34][35] - Its wholly-owned subsidiary, Jiuhe, has established a dense marketing network across major fertilizer-consuming regions and is transforming into a comprehensive agricultural service provider, integrating R&D, production, sales, technical services, and cultivation[36] - The company has established the "Lutianhua Green Low-Carbon Technology R&D Center" and collaborates with domestic and international research institutions to build a "high-end full industrial chain green circular chemical enterprise," continuously advancing innovation[37] (I) Brand Competitiveness As the cradle of China's modern urea industry, the company boasts renowned brands like "Gongnong" urea, enjoying a strong reputation and market foundation nationwide - The company is China's first enterprise to use Western technology to produce synthetic ammonia and urea from natural gas, earning the title "cradle of China's modern urea industry"[32] - Its core brand, "Gongnong" brand urea, has been recognized as a "China Famous Brand Product" and "China Well-known Trademark," enjoying a good reputation and market foundation across 31 provinces, autonomous regions, and municipalities nationwide[34] (II) Industrial Chain Competitiveness The company optimizes its "ammonia, acid, alcohol, fertilizer, hydrogen" elements to enhance production, achieve energy savings, reduce emissions, and improve overall efficiency through deep integration with surrounding chemical enterprises - The company fully leverages its five key elements: ammonia (synthetic ammonia), acid (nitric acid), alcohol (methanol), fertilizer (urea, new high-efficiency compound fertilizers), and hydrogen (hydrogen gas) to optimize production scheduling[35] - Through deep integration in natural gas chemicals and deep processing of raw and auxiliary materials and products with surrounding chemical enterprises, the company maximizes raw material and energy utilization efficiency, comprehensively enhancing overall benefits[35] (III) Marketing Network and Service Competitiveness The company's wholly-owned subsidiary, Jiuhe, has established an extensive marketing network and is transforming towards comprehensive agricultural services, integrating R&D, production, sales, technical services, and cultivation - Jiuhe, a wholly-owned subsidiary of the company, has established a dense marketing network with sales and after-sales service outlets across major fertilizer-consuming regions nationwide, comprising ten departments, one institute, three bases, four battle zones, and thirteen marketing teams[36] - The company focuses on building five major platforms: "New Agricultural Chemical R&D Platform," "Specialty Fertilizer Business Platform," "Agricultural Technology Service Platform," "New Agricultural Chemical Business + E-commerce Platform," and "Agricultural Planting Demonstration Platform"[36] - This initiative promotes the company's transformation from fertilizer production and sales to a comprehensive agricultural chemical service model that integrates R&D, production, sales, technical services, and cultivation for circular development[36] (IV) Innovation Competitiveness The company actively collaborates with domestic and international research institutions, establishing the "Lutianhua Green Low-Carbon Technology R&D Center" to foster innovation and build a high-end green circular chemical enterprise - While strengthening its talent team, the company actively collaborates with domestic and international research institutes to establish R&D platforms and conduct scientific research and development[37] - It has established the "Lutianhua Green Low-Carbon Technology R&D Center" and invited experts from research institutes to serve as external experts, focusing on building a "high-end full industrial chain green circular chemical enterprise"[37] Main Business Analysis During the reporting period, the company's operating revenue decreased by 13.45% due to lower product prices, leading to a 65.55% decline in net profit attributable to the parent company and a 98.51% drop in net cash flow from operating activities Major Financial Data Year-on-Year Changes | Indicator | Current Period (RMB) | Prior Year Period (RMB) | YoY Change | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 2,378,804,908.52 | 2,748,552,231.75 | -13.45% | | | Operating Cost | 2,179,502,745.80 | 2,388,379,296.05 | -8.75% | | | Administrative Expenses | 109,305,810.04 | 218,725,512.72 | -50.03% | Primarily due to the reclassification of some routine equipment repair costs to manufacturing costs and enhanced expense control | | Financial Expenses | -14,764,372.34 | -30,333,191.72 | -51.33% | Primarily due to a decrease in interest income | | Net Cash Flow from Operating Activities | 4,871,847.14 | 327,444,444.91 | -98.51% | Primarily due to a decrease in product prices, leading to reduced operating cash inflows | | Net Cash Flow from Investing Activities | 544,667,621.06 | -342,760,806.67 | 258.91% | Primarily due to the recovery of wealth management product investments and a reduction in such investments during the reporting period | Operating Revenue Composition (by Industry, by Product) | Category | Current Period Amount (RMB) | Proportion of Operating Revenue | Prior Year Period Amount (RMB) | Proportion of Operating Revenue | | :--- | :--- | :--- | :--- | :--- | | By Industry | | | | | | Fertilizer Industry | 1,683,114,129.54 | 70.75% | 1,839,632,330.75 | 66.93% | | Chemical Industry | 682,905,402.14 | 28.71% | 855,869,599.86 | 31.14% | | By Product | | | | | | Fertilizer Products | 1,683,114,129.54 | 70.75% | 1,839,632,330.75 | 66.93% | | Chemical Products | 682,905,402.14 | 28.71% | 855,869,599.86 | 31.14% | Industries, Products, or Regions Accounting for Over 10% of Company's Operating Revenue or Operating Profit | Category | Operating Revenue (RMB) | Operating Cost (RMB) | Gross Margin | YoY Change in Operating Revenue | YoY Change in Operating Cost | YoY Change in Gross Margin | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | By Industry | | | | | | | | Fertilizer Industry | 1,683,114,129.54 | 1,546,068,967.12 | 8.14% | -8.51% | 2.15% | -9.58% | | Chemical Industry | 682,905,402.14 | 626,537,821.77 | 8.25% | -20.21% | -25.00% | 5.87% | | By Product | | | | | | | | Fertilizer Products | 1,683,114,129.54 | 1,546,068,967.12 | 8.14% | -8.51% | 2.15% | -9.58% | | Chemical Products | 682,905,402.14 | 626,537,821.77 | 8.25% | -20.21% | -25.00% | 5.87% | | By Region | | | | | | | | Domestic Sales | 2,378,804,908.52 | 2,179,502,745.80 | 8.38% | -13.45% | -8.75% | -4.14% | Non-Main Business Analysis During the reporting period, the company had no non-main business analysis content Analysis of Assets and Liabilities At the end of the reporting period, the company's total assets were 9.26 billion RMB, a 9.38% decrease from the previous year-end, with significant changes in various asset and liability categories Major Changes in Asset Composition | Item | Current Period-End Amount (RMB) | Proportion of Total Assets | Prior Year-End Amount (RMB) | Proportion of Total Assets | Change in Proportion | | :--- | :--- | :--- | :--- | :--- | :--- | | Cash and Bank Balances | 1,991,281,697.61 | 21.50% | 2,191,758,926.98 | 21.45% | 0.05% | | Inventories | 716,773,771.38 | 7.74% | 665,719,723.72 | 6.51% | 1.23% | | Fixed Assets | 3,669,669,235.00 | 39.63% | 3,772,614,024.12 | 36.92% | 2.71% | | Construction in Progress | 730,279,779.91 | 7.89% | 601,436,047.18 | 5.89% | 2.00% | | Long-term Borrowings | 85,693,174.08 | 0.93% | 186,660,206.82 | 1.83% | -0.90% | Assets and Liabilities Measured at Fair Value | Item | Beginning Balance (RMB) | Amount Purchased in Current Period (RMB) | Amount Sold in Current Period (RMB) | Ending Balance (RMB) | | :--- | :--- | :--- | :--- | :--- | | Trading Financial Assets | 1,298,285,837.86 | 580,000,000.00 | 1,280,000,000.00 | 598,285,837.86 | | Receivables Financing | 4,964,935.73 | 51,920,448.87 | | 56,885,384.60 | | Other Equity Instrument Investments | 23,506,895.69 | | | 27,660,362.75 | | Subtotal of Financial Assets | 1,326,757,669.28 | 631,920,448.87 | 1,280,000,000.00 | 682,831,585.21 | Assets with Restricted Ownership or Use Rights (Period-End) | Item | Book Balance (RMB) | Book Value (RMB) | Restriction Type | Restriction Details | | :--- | :--- | :--- | :--- | :--- | | Cash and Bank Balances | 1,006,178,514.05 | 1,006,178,514.05 | Pledge | Bill deposit | | Cash and Bank Balances | 50,000,000.00 | 50,000,000.00 | Freeze | Judicial freeze | | Fixed Assets | 2,154,760,523.49 | 767,910,559.00 | Mortgage | Loan mortgage | | Total | 3,232,164,260.47 | 1,845,314,295.98 | | | Investment Analysis During the reporting period, the company's total investment was 154 million RMB, a 6.08% decrease year-on-year, with a significant ongoing green fine chemical project Overall Investment Situation | Indicator | Amount (RMB) | | :--- | :--- | | Investment Amount for the Reporting Period | 153,934,750.22 | | Investment Amount for the Prior Year Period | 163,893,484.80 | | Change Rate | -6.08% | Significant Non-Equity Investments in Progress During the Reporting Period | Project Name | Investment Method | Industry | Amount Invested in Current Period (RMB) | Cumulative Investment Amount as of Period-End (RMB) | Project Progress | | :--- | :--- | :--- | :--- | :--- | :--- | | 100,000 tons/year Green Fine Chemical Project | Self-built | Fine Chemical Industry | 30,794,095.75 | 30,794,095.75 | 5.00% | Disposal of Major Assets and Equity During the reporting period, the company had no significant asset or equity disposals Analysis of Major Holding and Participating Companies The company's key subsidiaries, Jiuhe Company and Hening Company, reported operating revenues of 2.48 billion RMB and 760 million RMB, with net profits of 55.89 million RMB and 90.33 million RMB, respectively Major Subsidiaries and Participating Companies with Over 10% Impact on Company's Net Profit | Company Name | Company Type | Main Business | Registered Capital (RMB) | Total Assets (RMB) | Net Assets (RMB) | Operating Revenue (RMB) | Operating Profit (RMB) | Net Profit (RMB) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Jiuhe Company | Subsidiary | Nitrogen fertilizer manufacturing, sales | 200,000,000.00 | 2,690,456,866.18 | 666,425,678.27 | 2,479,861,224.85 | 64,351,643.33 | 55,890,087.30 | | Hening Company | Subsidiary | Nitrogen fertilizer manufacturing | 1,910,000,000.00 | 4,038,566,288.62 | 991,622,011.53 | 759,793,210.59 | 102,312,680.27 | 90,328,304.08 | Company's Controlled Structured Entities During the reporting period, the company had no controlled structured entities Risks Faced by the Company and Countermeasures The company addresses risks from rising costs, declining product prices, and environmental regulations through enhanced production control, optimized marketing strategies, and continuous safety and environmental standardization - The company's main raw material, natural gas, faces continuous price increase risks, impacting product costs and profit margins; the company manages this through multi-dimensional, full-process production control, reducing material consumption, strengthening internal control, and continuously cutting non-production expenses[54] - The domestic urea market faces significant oversupply pressure, with the company's main product market prices entering a downward cycle; the company strengthens market analysis, refines marketing strategies, adjusts market layout, and increases promotion and sales of high-value-added products to enhance market share[55] - The industry in which the company operates carries certain safety and environmental risks, with increasingly stringent environmental policies; the company continuously promotes safety and environmental standardization, vigorously conducts safety education and training, strictly controls safety and environmental risks, and achieves stable compliance discharge of "three wastes" through a circular economy model[56] Formulation and Implementation of Market Value Management System and Valuation Enhancement Plan The company has not formulated a market value management system nor disclosed a valuation enhancement plan - The company has not formulated a market value management system[57] - The company has not disclosed a valuation enhancement plan[57] Implementation of "Quality and Return Dual Improvement" Action Plan The company has not disclosed an announcement regarding the "Quality and Return Dual Improvement" action plan - The company has not disclosed an announcement regarding the "Quality and Return Dual Improvement" action plan[58] Corporate Governance, Environment, and Society This section details changes in the company's governance, its environmental information disclosure, and its social responsibility initiatives Changes in Company Directors, Supervisors, and Senior Management During the reporting period, independent director Yi Zhi resigned due to term expiration, and Ma Weimin was elected as an independent director for the eighth board of directors - Independent director Yi Zhi resigned due to serving six consecutive years as an independent director, in accordance with relevant regulations[60] - Ma Weimin was elected as an independent director for the company's eighth board of directors, approved at the 2024 annual general meeting[60] Profit Distribution and Capital Reserve Conversion to Share Capital in Current Period During the reporting period, the company had no profit distribution or capital reserve conversion to share capital Implementation of Equity Incentive Plans, Employee Stock Ownership Plans, or Other Employee Incentive Measures During the reporting period, the company had no implementation of equity incentive plans, employee stock ownership plans, or other employee incentive measures Environmental Information Disclosure The company and its main subsidiaries, Sichuan Lutianhua Co., Ltd. and Ningxia Hening Chemical Co., Ltd., are included in the list of enterprises required to disclose environmental information, accessible via relevant systems - The listed company and its main subsidiaries, Sichuan Lutianhua Co., Ltd. and Ningxia Hening Chemical Co., Ltd., are included in the list of enterprises required to disclose environmental information by law[61] - Environmental information disclosure reports can be accessed through the Enterprise Environmental Information Disclosure System (Sichuan) and (Ningxia)[61] Social Responsibility Performance In the first half of the year, the company actively fulfilled its social responsibilities through various initiatives, including party building, industrial assistance, visits, and charitable activities - The company consistently upholds the core philosophy of "contributing to and giving back to society," integrating social responsibility into its corporate development strategy and encouraging all employees to actively participate in public welfare activities[62] - The company dispatched 5 first secretaries (team members) to villages for regular assistance work and specifically studied targeted assistance tasks[63] - The company formed agricultural technology service teams, providing over 500 on-site guidance sessions, handling over 1,000 phone consultations, conducting over 200 agricultural technology training sessions, and releasing 32 technical videos[65] - The company donated 21 tons of chili fertilizer to Jiaoyuan Village in Gulin County, 12 tons of compound fertilizer to Zhaoping Village in Naxi District, 5.5 tons to Yunhui Village, and 30 tons of urea to Shagou Village in Xiji County, Ningxia[65] - The company organized a "Charity Day Donation" event, raising a total of 208,000 RMB, and an employee blood donation drive, collecting a total of 17,600 milliliters of blood[67] - Through the Ningxia Poverty Alleviation Foundation platform, the company conducted educational support activities, donating learning supplies worth 36,000 RMB to rural schools[67] Significant Matters This section covers significant matters including commitments, related party transactions, litigation, and major contracts Commitments Fulfilled and Overdue Unfulfilled Commitments by Actual Controller, Shareholders, Related Parties, Acquirers, and the Company During the reporting period, there were no commitments fulfilled or overdue unfulfilled commitments by the company's actual controller, shareholders, related parties, acquirers, or the company itself Non-Operating Fund Occupation by Controlling Shareholder and Other Related Parties During the reporting period, there was no non-operating fund occupation by the company's controlling shareholder or other related parties Irregular External Guarantees During the reporting period, the company had no irregular external guarantees Appointment and Dismissal of Accounting Firms The company's semi-annual financial report was not audited - The company's semi-annual financial report was not audited[70] Board of Directors' and Supervisory Board's Explanations on "Non-Standard Audit Report" for the Current Period During the reporting period, the company had no non-standard audit report, thus no explanations from the Board of Directors or Supervisory Board Board of Directors' Explanations on "Non-Standard Audit Report" for the Previous Year During the reporting period, the company had no non-standard audit report for the previous year, thus no explanations from the Board of Directors Bankruptcy and Reorganization Matters During the reporting period, the company had no bankruptcy and reorganization matters Litigation Matters During the reporting period, the company had no significant litigation or arbitration matters, nor other litigation matters Penalties and Rectification Status During the reporting period, the company had no penalties or rectification situations Integrity Status of the Company, its Controlling Shareholder, and Actual Controller During the reporting period, the company, its controlling shareholder, and actual controller had no integrity issues Significant Related Party Transactions During the reporting period, the company had no significant related party transactions, including those related to daily operations, asset/equity acquisitions/disposals, joint external investments, related party debts, or transactions with affiliated financial companies Major Contracts and Their Performance The company recognized right-of-use assets for leases of production facilities, land, and buildings, with significant external guarantees totaling 855.09 million RMB, representing 13.31% of net assets, and holds 18.29 million RMB in wealth management products Leased Asset Right-of-Use Status | Item | Original Book Value (RMB) | Accumulated Depreciation (RMB) | Book Value (RMB) | | :--- | :--- | :--- | :--- | | Production Facilities | 323,520,313.71 | 145,800,280.80 | 177,720,032.91 | | Land | 5,890,630.33 | 2,208,986.40 | 3,681,643.93 | | Buildings and Structures | 24,158,010.00 | 1,207,900.56 | 22,950,109.44 | Company and its Subsidiaries' External Guarantees (Excluding Guarantees to Subsidiaries) | Guarantor Name | Guarantee Limit (10,000 RMB) | Actual Guarantee Amount (10,000 RMB) | Guarantee Type | Guarantee Period | Fulfilled | | :--- | :--- | :--- | :--- | :--- | :--- | | Sichuan Chemical Holdings (Group) Co., Ltd | 102,205.88 | 102,205.88 | Joint and several liability guarantee | 8 years | No | Company's Guarantees to Subsidiaries (Partial) | Guarantor Name | Guarantee Limit (10,000 RMB) | Actual Guarantee Amount (10,000 RMB) | Guarantee Type | Guarantee Period | Fulfilled | | :--- | :--- | :--- | :--- | :--- | | Ningxia Hening Chemical Co., Ltd | 111,314.18 | 64,989.75 | Joint and several liability guarantee | 8 years | No | | Sichuan Lutianhua Import & Export Trading Co., Ltd | 150,000 | 8,000 | Joint and several liability guarantee | 6 months | No | | Jiuhe Co., Ltd | 30,000 | 1,400 | Joint and several liability guarantee | 6 months | No | - As of the end of the reporting period, the total approved guarantee limit was 3.94 billion RMB, with an actual guarantee balance of 855.09 million RMB, accounting for 13.31% of the company's net assets[75] - The debt guarantee balance provided for guaranteed parties with an asset-liability ratio exceeding 70% was 601.54 million RMB[75] Entrusted Wealth Management The company holds broker wealth management products with an outstanding balance of 18.29 million RMB at period-end, funded by its own capital, and no overdue unrecovered amounts Entrusted Wealth Management Status | Specific Type | Source of Entrusted Wealth Management Funds | Outstanding Balance (10,000 RMB) | | :--- | :--- | :--- | | Broker Wealth Management Products | Own funds | 1,828.58 | | Total | | 1,828.58 | - The company has no high-risk entrusted wealth management products with significant individual amounts or low safety and poor liquidity[78] - No situations have arisen where entrusted wealth management is expected to be unrecoverable or where other impairment may occur[78] Other Major Contracts During the reporting period, the company had no other major contracts Explanation of Other Significant Matters During the reporting period, the company had no other significant matters to explain Significant Matters of Company Subsidiaries During the reporting period, the company's subsidiaries had no significant matters Share Changes and Shareholder Information This section details changes in the company's share capital, shareholder structure, and related information Share Change Status During the reporting period, the company's total share capital remained unchanged at 1.568 billion unrestricted shares, with a completed share repurchase plan for equity incentives Share Change Status | Item | Number of Shares Before Change (shares) | Proportion Before Change | Net Increase/Decrease in Current Change (shares) | Number of Shares After Change (shares) | Proportion After Change | | :--- | :--- | :--- | :--- | :--- | :--- | | II. Unrestricted Shares | 1,568,000,000 | 100.00% | 0 | 1,568,000,000 | 100.00% | | III. Total Shares | 1,568,000,000 | 100.00% | 0 | 1,568,000,000 | 100.00% | - The company completed its share repurchase plan on June 19, 2025, having repurchased a total of 23,595,637 shares, representing 1.505% of the current total share capital, with a total transaction amount of 89.05 million RMB[81] - These repurchased shares will be used for equity incentives[81] Securities Issuance and Listing Status During the reporting period, the company had no securities issuance or listing activities Company Shareholder Numbers and Shareholding Status At the end of the reporting period, the company had 41,760 common shareholders, with Lutianhua (Group) Co., Ltd. and Luzhou Industrial Development Investment Group Co., Ltd. being major shareholders with 15.09% and 14.84% stakes, respectively - At the end of the reporting period, the total number of common shareholders was 41,760[84] Shareholding of Shareholders Holding 5% or More or Top 10 Shareholders | Shareholder Name | Shareholder Nature | Shareholding Ratio | Number of Shares Held at Period-End (shares) | Change in Current Period (shares) | Number of Unrestricted Shares Held (shares) | | :--- | :--- | :--- | :--- | :--- | :--- | | Lutianhua (Group) Co., Ltd | State-owned Legal Person | 15.09% | 236,550,393 | 0 | 236,550,393 | | Luzhou Industrial Development Investment Group Co., Ltd | State-owned Legal Person | 14.84% | 232,664,610 | 39,200,000 | 232,664,610 | | Bank of China Co., Ltd. Luzhou Branch | Domestic Non-state-owned Legal Person | 9.11% | 142,847,727 | -9,032,700 | 142,847,727 | | Sichuan Lutianhua Co., Ltd. Bankruptcy Enterprise Property Disposal Special Account | Domestic Non-state-owned Legal Person | 5.83% | 91,363,464 | -1,109,250 | 91,363,464 | | Agricultural Bank of China Co., Ltd. Sichuan Branch | State-owned Legal Person | 5.00% | 78,402,297 | 0 | 78,402,297 | - Among the top 10 shareholders, Lutianhua (Group) Co., Ltd. and Luzhou Industrial Development Investment Group Co., Ltd. are parties acting in concert[84] Changes in Shareholdings of Directors, Supervisors, and Senior Management During the reporting period, there were no changes in the shareholdings of the company's directors, supervisors, and senior management Changes in Controlling Shareholder or Actual Controller During the reporting period, there were no changes in the company's controlling shareholder or actual controller Preferred Share Related Information During the reporting period, the company had no preferred share related information Bond-Related Information This section provides information regarding the company's bonds Bond-Related Information During the reporting period, the company had no bond-related information Financial Report This section presents the company's financial statements, including the audit report, balance sheets, income statements, cash flow statements, and statements of changes in owners' equity Audit Report The company's semi-annual report was not audited - The company's semi-annual report was not audited[91] Financial Statements This section presents the company's consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in owners' equity for the first half of 2025, providing a comprehensive view of its financial position, operating results, and cash flows at the end of the reporting period 1. Consolidated Balance Sheet As of June 30, 2025, the company's consolidated total assets were 9.26 billion RMB, a 9.38% decrease from the beginning of the period, with total liabilities at 2.83 billion RMB and total owners' equity at 6.43 billion RMB Consolidated Balance Sheet Key Data (Period-End) | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Total Assets | 9,260,429,068.88 | 10,219,298,716.97 | | Total Current Assets | 4,344,681,129.38 | 5,300,497,742.79 | | Total Non-current Assets | 4,915,747,939.50 | 4,918,800,974.18 | | Total Liabilities | 2,831,431,497.15 | 3,839,987,631.29 | | Total Owners' Equity | 6,428,997,571.73 | 6,379,311,085.68 | 2. Parent Company Balance Sheet As of June 30, 2025, the parent company's total assets were 7.07 billion RMB, a 1.25% decrease from the beginning of the period, with total liabilities at 1.13 billion RMB and total owners' equity at 5.94 billion RMB Parent Company Balance Sheet Key Data (Period-End) | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Total Assets | 7,070,054,065.16 | 7,159,925,533.30 | | Total Current Assets | 4,507,664,534.00 | 4,830,365,531.01 | | Total Non-current Assets | 2,562,389,531.16 | 2,329,560,002.29 | | Total Liabilities | 1,133,801,085.39 | 834,025,164.72 | | Total Owners' Equity | 5,936,252,979.77 | 6,325,900,368.58 | 3. Consolidated Income Statement In the first half of 2025, the company's consolidated total operating revenue was 2.38 billion RMB, a 13.45% year-on-year decrease, resulting in a net profit of 45.77 million RMB and basic earnings per share of 0.03 RMB Consolidated Income Statement Key Data | Item | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Total Operating Revenue | 2,378,804,908.52 | 2,748,552,231.75 | | Operating Profit | 48,145,003.56 | 121,200,325.47 | | Total Profit | 62,415,494.53 | 159,256,388.18 | | Net Profit | 45,771,675.40 | 133,795,585.30 | | Net Profit Attributable to Parent Company Shareholders | 46,102,567.96 | 133,842,477.11 | | Basic Earnings Per Share | 0.03 | 0.09 | | Diluted Earnings Per Share | 0.03 | 0.09 | 4. Parent Company Income Statement In the first half of 2025, the parent company's operating revenue increased by 31.30% to 1.41 billion RMB, but it incurred a net loss of 90.01 million RMB, a significant reversal from the prior year's profit Parent Company Income Statement Key Data | Item | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Operating Revenue | 1,414,410,263.31 | 1,077,204,895.03 | | Operating Profit | -94,227,019.19 | 1,618,750.46 | | Total Profit | -94,206,748.73 | 1,196,293.33 | | Net Profit | -90,006,894.75 | 4,306,611.31 | | Basic Earnings Per Share | -0.06 | 0.00 | | Diluted Earnings Per Share | -0.06 | 0.00 | 5. Consolidated Cash Flow Statement In the first half of 2025, the company's net cash flow from operating activities significantly decreased by 98.51% to 4.87 million RMB, while net cash flow from investing activities substantially increased by 258.91% to 545 million RMB Consolidated Cash Flow Statement Key Data | Item | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 4,871,847.14 | 327,444,444.91 | | Net Cash Flow from Investing Activities | 544,667,621.06 | -342,760,806.67 | | Net Cash Flow from Financing Activities | -236,916,594.43 | -299,113,875.63 | | Net Increase in Cash and Cash Equivalents | 312,618,846.34 | -314,430,237.37 | 6. Parent Company Cash Flow Statement In the first half of 2025, the parent company's net cash flow from operating activities improved to -45.39 million RMB, while net cash flow from investing activities significantly increased to 446 million RMB Parent Company Cash Flow Statement Key Data | Item | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | -45,387,107.32 | -267,471,771.18 | | Net Cash Flow from Investing Activities | 445,631,074.16 | 7,488,714.01 | | Net Cash Flow from Financing Activities | -120,029,075.14 | -50,029,075.13 | | Net Increase in Cash and Cash Equivalents | 280,214,891.70 | -310,012,132.30 | 7. Consolidated Statement of Changes in Owners' Equity In the first half of 2025, the company's consolidated owners' equity totaled 6.43 billion RMB, an increase of 0.78% from the beginning of the period, primarily driven by comprehensive income and changes in other capital reserves Consolidated Statement of Changes in Owners' Equity (Current Period) | Item | Beginning Balance (RMB) | Change in Current Period (RMB) | Ending Balance (RMB) | | :--- | :--- | :--- | :--- | | Total Owners' Equity Attributable to Parent Company | 6,373,725,760.72 | 50,017,378.61 | 6,423,743,139.33 | | Minority Interests | 5,585,324.96 | -330,892.56 | 5,254,432.40 | | Total Owners' Equity | 6,379,311,085.68 | 49,686,486.05 | 6,428,997,571.73 | Company Basic Information Sichuan Lutianhua Co., Ltd., established on April 5, 1999, with a registered capital of 1.568 billion RMB, is a state-controlled listed company in the chemical industry, primarily producing and selling fertilizers and chemical products - Sichuan Lutianhua Co., Ltd. publicly issued RMB A-shares on April 5, 1999, with a registered capital of 1.568 billion RMB[125][127][131] - The company's legal representative is Liao Tingjun, its address is in Naxi District, Luzhou City, Sichuan Province, and its organizational form is a joint-stock company (listed, state-controlled)[131] - The company operates in the chemical industry, primarily engaged in the production and sale of various fertilizers and chemical products[132] - The company's largest shareholder is Lutianhua (Group) Co., Ltd., and its ultimate actual controller is the Luzhou State-owned Assets Supervision and Administration Commission[135] (I) Company History Since its establishment in 1999, the company has undergone several capital increases and equity transfers, with Lutianhua Group regaining its controlling shareholder status through various transactions - The company publicly issued 150 million RMB A-shares on April 5, 1999, with a total share capital of 450 million shares after issuance[125] - On July 27, 2018, the company implemented a capital reserve conversion to shares at a ratio of 16.803419 shares for every 10 shares, increasing its total share capital to 1.568 billion shares[127] - In December 2018, Lutianhua Group purchased 286 million shares of the company's capital reserve converted shares, increasing its stake to 18.24%, and together with its concerted party, Chanfa Group, held a combined 25.58%, becoming the controlling shareholder[129] - From March 1, 2024, to August 30, 2024, Lutianhua Group cumulatively increased its shareholding in the listed company by 25,091,400 shares through centralized bidding, changing its shareholding ratio to 15.09% and remaining the controlling shareholder[130] (II) Company's Registered Address, Organizational Form, and Headquarters Address The company's latest business license was issued by the Luzhou Market Supervision Administration, with a unified social credit code of 91510500711880825C, registered capital of 1.568 billion RMB, and its legal representative is Liao Tingjun - The company's latest business license was issued by the Luzhou Market Supervision Administration, with a unified social credit code: 91510500711880825C[131] - Registered capital: 1.568 billion RMB; organizational form: joint-stock company (listed, state-controlled); legal representative: Liao Tingjun; company address: Naxi District, Luzhou City, Sichuan Province[131] (III) Company's Business Nature, Scope, and Revenue Composition The company operates in the chemical industry, primarily producing and selling various fertilizers and chemical products, with revenue mainly derived from its parent company and subsidiaries' production and sales activities - The company operates in the chemical industry, primarily engaged in the production and sale of various fertilizers and chemical products[132] - Its business scope includes the production of ammonia, carbon dioxide, methanol, nitric acid, etc., as well as fertilizer manufacturing, synthetic fiber monomer (polymer) manufacturing, import and export, and technology promotion and application services[133] - The company's operating revenue primarily consists of the production and sale of fertilizers and chemical products by the parent company and Ningxia Hening Chemical Co., Ltd., with compound fertilizer production and sales and purchased product sales by Jiuhe Co., Ltd. also forming part of the operating revenue[134] (IV) Approver of Financial Report The company's financial report was approved and issued by the Board of Directors at its fourteenth meeting of the eighth session in August 2025 - The company's financial report was approved and issued by the Board of Directors, with this financial report approved at the fourteenth meeting of the eighth session of the Board of Directors in August 2025[136] Basis of Financial Statement Preparation The company's financial statements are prepared on a going concern basis, adhering to accounting standards issued by the Ministry of Finance and disclosure regulations by the CSRC, with historical cost measurement and no significant doubt about future operations - The company's financial statements are prepared on a going concern basis, in accordance with actual transactions and events, and in compliance with the accounting standards issued by the Ministry of Finance, their accompanying guidelines and interpretations, and the disclosure requirements of the China Securities Regulatory Commission's "Rules for the Preparation of Information Disclosure by Companies Issuing Securities No. 15 - General Provisions for Financial Reports" (Revised in 2023)[137] - The company's accounting is based on the accrual basis. Except for certain financial instruments, these financial statements are measured at historical cost. If assets are impaired, corresponding impairment provisions are made in accordance with relevant regulations[137] - The company believes there are no significant doubts or circumstances regarding its ability to continue as a going concern for the next 12 months, and thus, preparing financial statements on a going concern basis is reasonable[138] Significant Accounting Policies and Estimates This section outlines the company's adherence to Enterprise Accounting Standards, covering accounting periods, operatin