CHINANEWENERGY(01156) - 2025 - 中期业绩

Financial Statements Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2025, the Group experienced significant declines in revenue and gross profit, shifting from profit to a substantially widened operating and period loss | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 23,570 | 36,584 | -35.6% | | Cost of sales | (21,168) | (31,315) | -32.4% | | Gross profit | 2,402 | 5,269 | -54.5% | | Operating loss | (7,176) | (1,584) | +353.0% | | Loss for the period | (7,802) | (2,542) | +206.9% | Condensed Consolidated Statement of Comprehensive Income The Group's total comprehensive loss for the period significantly increased, driven by an expanded period loss and a shift from foreign exchange gains to losses on overseas operations | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Loss for the period | (7,802) | (2,542) | +206.9% | | Exchange differences on translation of overseas operations | (76) | 1,013 | -107.5% | | Total comprehensive loss for the period | (7,878) | (1,529) | +415.2% | | Loss attributable to owners of the Company | (7,852) | (2,760) | +184.5% | | Basic loss per share (RMB) | (0.013) | (0.005) | +160.0% | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total and net assets significantly declined, net current liabilities increased, total equity substantially decreased, and the gearing ratio rose sharply | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current assets | 75,797 | 79,140 | -4.2% | | Current assets | 168,956 | 187,424 | -9.8% | | Current liabilities | 234,295 | 246,788 | -5.1% | | Net current liabilities | (65,339) | (59,364) | +10.1% | | Net assets | 1,777 | 9,655 | -81.6% | | Total equity | 1,777 | 9,655 | -81.6% | Notes to the Condensed Consolidated Financial Statements 1. General Information China New Energy Limited, registered in Jersey and listed on the HKEX, primarily provides integrated technical services for ethanol production systems in China's ethanol fuel and alcoholic beverage sectors - The Company was incorporated in Jersey on May 2, 2006, with shares listed on the Hong Kong Stock Exchange since July 15, 2020[9] - The principal business involves providing integrated technical services for ethanol production systems in the ethanol fuel and alcoholic beverage industries within the People's Republic of China[9] - The condensed consolidated interim financial statements are presented in RMB and were approved for issue by the Board of Directors on August 26, 2025[9] 2. Basis of Preparation These condensed consolidated financial statements are prepared under IAS 34, emphasizing significant going concern uncertainties despite board measures and major shareholder support - The condensed consolidated financial statements have been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting"[10] - As of June 30, 2025, the Group recorded a net loss of approximately RMB 7,802,000, and net current liabilities exceeding current assets by approximately RMB 65,339,000, indicating a material uncertainty regarding going concern[11] - The Board has taken measures to mitigate liquidity pressure, including financial support from a major shareholder, negotiating loan extensions with lenders, reducing expenses and capital expenditures, and anticipating positive cash flows in the future[12][14] 3. Principal Accounting Policies The condensed consolidated financial statements are prepared using the historical cost convention, with the first-time application of IAS 21 (Amendment) 'Lack of Exchangeability' having no material impact - The condensed consolidated financial statements are prepared on the historical cost basis, except for certain financial instruments measured at fair value[15] - The first-time application of IAS 21 (Amendment) "Lack of Exchangeability" during this interim period had no significant impact on the Group's financial position and performance[16] 4. Segment Information Management reviews the Group's business as a single segment, providing integrated technical services for ethanol production systems in various sectors, with all non-current assets located in China - Management reviews the operating results of the business as one segment, considering there is only one segment for making strategic decisions[17] - The Group primarily provides integrated technical services for ethanol production systems in the ethanol fuel and alcoholic beverage industries, and for medical and industrial ethyl acetate related projects[17] - As of December 31, 2024, and June 30, 2025, all non-current assets were located in the People's Republic of China[18] 5. Revenue, Contract Assets and Contract Liabilities In H1 2025, revenue decreased by 35.6% year-on-year, primarily from ethanol fuel, alcoholic beverage, and ethyl acetate projects, with China contributing most revenue, while net contract assets and liabilities declined Revenue by Source | Revenue Source | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Ethanol fuel industry | 12,709 | 24,825 | -48.8% | | Alcoholic beverage industry | 3,066 | 9,638 | -68.2% | | Others (Ethyl acetate related) | 7,795 | 2,121 | +267.5% | | Total | 23,570 | 36,584 | -35.6% | Revenue by Geographical Market | Region | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | China | 23,480 | 35,812 | -34.4% | | Other countries | 90 | 772 | -88.3% | | Total | 23,570 | 36,584 | -35.6% | Contract Assets and Liabilities | Customer Contract Related Assets and Liabilities | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Contract assets - net | 134,327 | 148,905 | -9.8% | | Contract liabilities | 33,832 | 36,190 | -6.5% | 6. Income Tax Credit In H1 2025, a deferred income tax credit of RMB 89 thousand was recognized, mainly from leases, with no tax provision for Hong Kong and Jersey, and a 15% preferential rate for the main PRC subsidiary Income Tax Credit Summary | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Deferred income tax credit | 89 | – | | Total income tax credit | 89 | – | - Guangdong Zhongke Tianyuan New Energy Technology Co., Ltd., a principal subsidiary, was certified as a "High-tech Enterprise" in 2022, enjoying a preferential income tax rate of 15%[25] - The Company's income tax rate in Jersey is zero percent, and no provision for Hong Kong tax has been made as no income was generated in Hong Kong[24][26] 7. Loss Per Share Basic loss per share for H1 2025 widened to RMB 0.013 from RMB 0.005 in the prior period, primarily due to an increased loss attributable to owners of the Company Basic Loss Per Share | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Loss attributable to owners of the Company | (7,852) | (2,760) | | Weighted average number of ordinary shares in issue (thousands of shares) | 589,759 | 589,759 | | Basic loss per share (RMB) | (0.013) | (0.005) | - Diluted loss per share is not presented as there were no outstanding potential ordinary shares in either period[29] 8. Dividends During the reporting period, the Company neither declared nor paid any dividends - For the periods ended June 30, 2024, and 2025, the Company neither declared nor paid any dividends[30] 9. Trade and Bills Receivables As of June 30, 2025, net trade and bills receivables decreased by 31.6% year-on-year, with most balances aged within one year Trade and Bills Receivables Summary | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Net trade and bills receivables | 9,202 | 13,448 | -31.6% | Ageing Analysis of Trade and Bills Receivables (June 30, 2025) | Ageing Analysis (June 30, 2025) | Amount (RMB thousands) | | :--- | :--- | | Within 1 year | 9,088 | | 1 to 2 years | 114 | | 2 to 3 years | – | | Total | 9,202 | 10. Trade and Other Payables As of June 30, 2025, trade payables decreased by 10.4% year-on-year, with the largest portion aged over three years, while total other payables remained stable Trade and Other Payables Summary | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Trade payables | 55,853 | 62,260 | -10.4% | | Other payables and accrued expenses | 30,518 | 28,352 | +7.6% | | Amounts due to directors | 1,438 | 615 | +133.8% | | Accrued salaries | 5,667 | 6,211 | -8.7% | | VAT payable | 40,819 | 36,889 | +10.6% | | Total | 134,295 | 134,327 | 0.0% | Ageing Analysis of Trade Payables (June 30, 2025) | Trade Payables Ageing (June 30, 2025) | Amount (RMB thousands) | | :--- | :--- | | Within 1 year | 23,910 | | 1 to 2 years | 4,183 | | 2 to 3 years | 2,342 | | Over 3 years | 25,418 | | Total | 55,853 | Management Discussion and Analysis Business Review As a leading ethanol system producer, the Company faced challenges in H1 2025 from declining domestic fuel ethanol consumption, intensified competition, and slow international project progress, leading to reduced revenue and profit, while actively adjusting strategies and increasing R&D - The Company is a leading ethanol system producer in China, primarily providing integrated core system services for ethanol production in the ethanol fuel and alcoholic beverage industries[34] - In H1 2025, domestic fuel ethanol consumption declined, supply exceeded demand, production enterprises faced cost pressure, and industry competition intensified; international potential projects progressed slowly due to geopolitical and tariff impacts[35][36] - The Company actively recalibrated its marketing strategy, explored new markets such as baijiu concentration and impurity removal, and xanthan gum light alcohol recovery projects, and participated in coal-to-ethanol production line design, equipment installation, commissioning, and after-sales services[37] - During the reporting period, the Company signed 9 new contracts with a total contract value (excluding VAT) of RMB 31.86 million, consistent with the same period last year[38] - R&D expenses amounted to RMB 2.07 million (H1 2024: RMB 1.44 million), primarily focused on biomass fuel projects and small-scale hydrogen production units[39] - The five largest ongoing projects generated revenue of RMB 15.77 million, accounting for 66.9% of the Group's total revenue during the reporting period[40] Future Outlook The Company plans to capitalize on biofuel opportunities under 'dual carbon' goals, consolidate domestic markets, expand overseas, and increase revenue by strengthening marketing, exploring related industry investments, and boosting R&D in advanced ethanol, hydrogen, and higher alcohol production technologies - China's "14th Five-Year Plan" explicitly proposes expanding biofuel applications, with a target fuel ethanol consumption of 12 million tons by 2025, indicating significant long-term growth potential for the biofuel industry[41] - The Company will strengthen its marketing team, maintain existing clients, expand its new client portfolio, actively explore investment opportunities in related industries, and expand revenue from manufacturing and technical services for other chemical production equipment[41] - The Company will increase R&D investment in leading 1.5 and 2nd generation cellulosic ethanol production technologies, hydrogen energy production technologies, ethanol deep processing for higher alcohol production processes, and related equipment manufacturing[43] - As of the end of the reporting period, the Company and its subsidiaries held a total of 35 valid registered patents, including 19 invention patents[43] Financial Review In H1 2025, the Company's revenue, gross profit, and gross margin significantly decreased, associate performance turned to loss, leading to a substantial increase in loss attributable to owners, while administrative expenses and finance costs decreased, and income tax credit increased - Revenue decreased by 35.6% from approximately RMB 36.58 million in H1 2024 to approximately RMB 23.57 million in H1 2025, primarily due to fewer sales contracts and slower progress on existing contract projects[44] - Gross profit decreased by 54.5% from approximately RMB 5.27 million in H1 2024 to approximately RMB 2.40 million in H1 2025, with the overall gross margin decreasing from 14.4% to 10.2%, mainly affected by market fluctuations[45] - Selling and marketing expenses decreased by 18.9% to approximately RMB 1.80 million, and administrative expenses decreased by 12.6% to approximately RMB 7.59 million, primarily due to cost control measures[46][47] - Share of results of associates turned from a profit of approximately RMB 0.99 million in H1 2024 to a loss of approximately RMB 1.25 million in H1 2025, a decrease of 225.8%, mainly due to the decline in operating performance of associates[48] - Net finance costs decreased by 25.4% to approximately RMB 0.72 million, primarily referring to interest on bank borrowings and lease liabilities[50] - Income tax credit increased from RMB 0 in H1 2024 to approximately RMB 89,000 in 2025, due to deferred income tax credit arising from leases[51] - Loss attributable to owners of the Company expanded to approximately RMB 7.85 million (H1 2024: approximately RMB 2.76 million), mainly due to decreased revenue, lower gross margin, and reduced share of results of associates[52] Liquidity, Financial Resources and Capital Structure As of June 30, 2025, the Group's cash and cash equivalents significantly decreased, bank borrowings declined, but net current liabilities increased, total equity substantially reduced, leading to a sharp rise in the gearing ratio to 136.73% Liquidity and Capital Structure Summary | Indicator | June 30, 2025 (RMB millions) | December 31, 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | 1.09 | 4.17 | -73.9% | | Bank borrowings | 21.34 | 32.23 | -33.8% | | Total equity | 1.78 | 9.66 | -81.6% | | Net current liabilities | 65.34 | 59.36 | +10.1% | | Current ratio | 0.72 times | Largely unchanged | - | | Gearing ratio | 136.73% | 26.60% | +413.9% | Other Financial Information During the reporting period, the Group reported no significant changes in capital expenditure, major acquisitions, disposals, investments, contingent liabilities, or capital commitments, with certain assets pledged for financing, insignificant foreign exchange risk, and no speculative derivative transactions - The Group's capital expenditure primarily includes intangible assets and expenses for acquiring property, plant, and equipment related to operations, with no significant changes during the reporting period[55] - In H1 2025, there were no significant acquisitions or disposals of subsidiaries, associates, or joint ventures, nor any significant investments held outside its subsidiaries[56][57] - As of June 30, 2025, the Group had no contingent liabilities or capital commitments[60][62] - The right-of-use assets and buildings of the Company's subsidiaries have been pledged to banks as security for bank facilities granted to the Group[61] - The functional currency of the Group's operations, assets, and liabilities is RMB, and it does not face significant foreign exchange risk, nor does it use any financial instruments for hedging purposes[63] - The Group's treasury policy prohibits entering into derivative transactions for speculative purposes[64] Employees and Remuneration Policy As of June 30, 2025, the Group had 84 full-time employees, whose skills are enhanced through customized training, with remuneration comprising salaries and bonuses determined by qualifications, position, and performance - As of June 30, 2025, the Group had 84 full-time employees (December 31, 2024: 82 employees)[65] - The Group provides tailored training programs to employees aimed at enhancing their skills and knowledge[65] - Remuneration for employees generally includes salaries and bonuses, determined based on each employee's qualifications, position, and performance[65] Other Information Corporate Governance Practices The Company is committed to maintaining high corporate governance standards and confirmed compliance with all code provisions of the Corporate Governance Code in Appendix C1 Part 2 of the HKEX Listing Rules during the reporting period - The Company is committed to achieving and maintaining a high level of corporate governance to protect shareholders' interests and create long-term value[66] - The Directors believe that for the six months ended June 30, 2025, the Company has complied with all code provisions of the Corporate Governance Code set out in Appendix C1 Part 2 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[66] Standard Code for Securities Transactions The Company has adopted the Standard Code for Securities Transactions by Directors of Listed Issuers in Appendix C3 of the Listing Rules and confirmed directors' compliance with its requirements during the reporting period - The Company has adopted the Standard Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules as its own code of conduct[67] - Following specific enquiry, the Company confirmed that the Directors have complied with the required standards set out in the Standard Code for the six months ended June 30, 2025[67] Interim Dividends The Board resolved not to declare any interim dividend for the six months ended June 30, 2025 - The Board resolved not to declare any interim dividend for the six months ended June 30, 2025 (six months ended June 30, 2024: nil)[68] Purchase, Sale or Redemption of the Company's Listed Securities During the six months ended June 30, 2025, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities, and no treasury shares were held - During the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[69] - As of June 30, 2025, the Company did not hold any treasury shares[69] Review and Publication The Group's interim results for the six months ended June 30, 2025, have been reviewed by the Company's Audit Committee and will be published on the HKEX and Company websites - The Group's interim results for the six months ended June 30, 2025, have been reviewed by the Company's Audit Committee, which comprises three independent non-executive directors[70] - This announcement is published on the HKEX website (www.hkexnews.hk) and the Company's website (www.zkty.com.cn)[71](index=71&type=chunk)