Fujian Fynex Textile Science & Technology Co Ltd

Fengzhu Textile released its 2026 interim report after market close on August 28. Revenue reached 466 million yuan, up 9.19% year on year, but net profit attributable to the parent was only 1.29 million yuan, down 83.73% year on year, while non-GAAP net profit showed a loss of 1.94 million yuan. The profit decline was mainly due to lower gross margin and additional depreciation at the Henan plant. As of the end of June, the company's gross margin was 13.08% and net margin was only 0.28%. Accounts receivable stood at 156 million yuan, more than 1,000% of net profit attributable to the parent, while inventory was 246 million yuan. Cash of 170 million yuan was insufficient to cover short-term liabilities of 212 million yuan. Revenue has declined for four consecutive years since the 2021 peak of 1.30 billion yuan, and net profit has fallen for two straight years. Industry insiders noted that the flexible-support rooftop solar project at the Andong new plant, the first of its kind in China's textile industry, generates about 6 million kilowatt-hours of electricity annually, which can reduce electricity costs over the long term and become a future growth driver.

Fengzhu Textile disclosed its earnings forecast, estimating net profit attributable to the parent company at 1.33 million yuan for the first half of 2026, a year-on-year decline of 83.26 percent. Deducted non-recurring net profit is expected to be a loss of 1.85 million yuan, compared with a profit of 2.5886 million yuan in the same period last year. The company stated that during the reporting period, downstream demand was sluggish, product sales gross margin declined, capacity utilization fell short of expectations, and fixed amortization costs increased, leading to the decline in performance. Based on the closing price on July 10, Fengzhu Textile currently has a price-to-earnings ratio of about 175.58 times, a price-to-book ratio of about 1.44 times, and a price-to-sales ratio of about 1.72 times.