Huafang Co Ltd

Huafang Co. released its 2026 interim report, showing a net loss attributable to the parent of 44 million yuan, an increase of 9.33 million yuan compared with the same period last year. Total operating revenue was 1.478 billion yuan, up 3.69 percent year on year, marking a third consecutive year of growth. Net cash inflow from operating activities was 36.15 million yuan, up 52.48 percent year on year. The company's latest asset-liability ratio was 72.91 percent, gross margin was 8.85 percent, return on equity was negative 4.91 percent, and diluted earnings per share was negative 0.07 yuan.

Huafang Co. disclosed its earnings forecast, expecting a net loss attributable to the parent company of 44 million yuan in the first half of 2026, compared with a loss of 34.6777 million yuan in the same period last year. The net loss after deducting non-recurring items is expected to be 48 million yuan, compared with a loss of 35.4274 million yuan a year earlier. The company stated that the change in performance is mainly due to declining market demand, rising material costs, and the impact of exchange rate fluctuations. Domestic retail sales of apparel and home textiles have declined, and brand apparel companies have reduced fabric purchase orders to destock, leading to a year-on-year decrease in printing and dyeing orders. Overseas demand is weak, with buyers cutting back on medium- and long-term large orders, and the expansion of printing and dyeing capacity in Southeast Asia has diverted domestic orders. At the same time, raw material prices such as cotton and polyester remain high, energy costs like steam have increased, and the continued appreciation of the renminbi has led to higher exchange losses. In addition, the company received other income and incidental non-operating income and expenses totaling more than 4 million yuan in the first half of 2026.