Hubei Fuxing Science and Technology Co Ltd

Fuxing Shares released its 2026 interim report on August 28. First-half operating revenue was 749 million yuan, up 2.2 percent year on year, but net profit attributable to the parent swung from a loss of 658 million yuan in the same period last year to a loss of 2.334 billion yuan. Net profit attributable to the parent after deducting non-recurring items widened from a loss of 629 million yuan to a loss of 2.268 billion yuan. Net operating cash flow was 573 million yuan, down 16.2 percent year on year, and earnings per share were negative 1.4654 yuan. In the second quarter, operating revenue was 347 million yuan, down 10.5 percent year on year, while net profit attributable to the parent widened from a loss of 562 million yuan to a loss of 2.2 billion yuan. As of the end of the second quarter, total assets were 19.912 billion yuan, down 10.8 percent from the end of the previous year, and net assets attributable to the parent were 3.03 billion yuan, down 43.5 percent from the end of the previous year. The company's main businesses are concentrated in two segments: real estate and metal products. In real estate, it promotes urban renewal through urban village redevelopment and old city renovation. In metal products, it focuses on products such as steel cord for radial tires. Operationally, the company follows a prudent approach, advancing work around project development, inventory reduction, and collection of accounts receivable. Among its projects, the Fuxing Huiyu Platinum Mansion project achieved contracted sales area of 32,600 square meters, and the occupancy rate of its self-held properties exceeded 90 percent.

The Shenzhen Stock Exchange issued an announcement on August 18, publicly reprimanding Fuxing Shares along with Chairman Tan Shaoqun, General Manager Feng Dongxing, former Chief Financial Officer Feng Junxiu, and Board Secretary Xiao Yongchao. Upon review, the company's 2025 annual report contained errors in 34 data points or statements, including the weighted average return on equity, key financial indicators by quarter, non-recurring profit and loss items and amounts, amounts of newly added land reserves, sales figures for major projects, year-on-year changes in gross margin and operating costs for the central China region, and the ending balance of allowance for bad debts on other receivables. In addition, the summary of the company's 2025 annual report contained errors in two data points, namely the weighted average return on equity and key financial indicators by quarter. In the first quarter of 2026, Fuxing Shares achieved revenue of 401 million yuan and a net loss attributable to the parent company of 133 million yuan.

Fuxing Shares disclosed its performance forecast, expecting a net loss attributable to the parent company of 1.6 billion to 2.4 billion yuan in the first half of 2026, compared with a loss of 658 million yuan in the same period last year. The net loss after deducting non-recurring items is expected to be 1.57 billion to 2.35 billion yuan, compared with a loss of 629 million yuan a year earlier. Basic earnings per share are projected at negative 1 yuan to negative 1.51 yuan per share. The company stated that the loss is mainly due to the continued decline in the settlement scale of real estate development projects, coupled with changes in the industry and market operating environment, resulting in the overall gross profit margin remaining at a low level, and a corresponding increase in asset impairment provisions. The company is revitalizing existing assets and leveraging the synergy of its dual main businesses to deepen cost reduction and efficiency improvement, and promote stable and sustainable development.