Xinyu Iron & Steel Co Ltd

Xinyu Steel released its 2026 interim report. Total operating revenue was 16.108 billion yuan, down 8.02% year-on-year. Net profit attributable to the parent company was negative 607 million yuan, swinging from profit to loss year-on-year, a decline of 652.64%. Net cash flow from operating activities was negative 1.245 billion yuan, a decrease of 529 million yuan year-on-year. The company's asset-liability ratio was 42.96%, gross margin was negative 0.04%, return on equity was negative 2.42%, and diluted earnings per share was negative 0.19 yuan. The number of shareholders was 49,500, and the top ten shareholders held 55.06% of total share capital.

Xinyu Steel disclosed its 2026 semi-annual report on August 27. In the first half of the year, it achieved total operating revenue of 16.108 billion yuan, down 8.02 percent year on year. Net profit attributable to the parent company was a loss of 607 million yuan, compared with a profit of 110 million yuan in the same period last year. Net profit after deducting non-recurring items was a loss of 715 million yuan, compared with a loss of 62.8561 million yuan a year earlier. Net cash flow from operating activities was negative 1.245 billion yuan, compared with negative 716 million yuan in the prior-year period. Basic earnings per share were negative 0.19 yuan, and the weighted average return on equity was negative 2.36 percent, down 2.78 percentage points year on year. The company is mainly engaged in the smelting, forging and processing, and sale of ferrous metals and metal products.

First-half earnings forecasts from domestic listed steel companies show a marked widening of industry losses. According to an incomplete tally by Jiemian News, 15 out of 20 listed steelmakers are in the red, accounting for 75 percent. Among them, Angang Steel, Bengang Steel Plates, and Anyang Iron and Steel each reported losses exceeding 1 billion yuan, while Wujin Stainless Steel and Zhongnan Steel, among others, swung from profit to loss. Ge Xin, deputy director of Lange Steel Research Center, noted that the domestic steel market is oversupplied, while iron ore, coking coal, and coke have all stayed at elevated prices, with dual cost pressures continuously eating into steelmakers' profits. Mysteel data from Shanghai Ganglian shows that raw material price increases significantly outpaced steel in the first half, with coking coal prices up 74 percent year on year and coke prices up 57.3 percent. National Bureau of Statistics data shows that profits in ferrous metal smelting and rolling processing totaled 18.17 billion yuan in the first five months, down 42.7 percent year on year. Facing the industry downturn, product mix and resource endowments have become a dividing line. Companies such as Taiyuan Iron and Steel, Jiuquan Iron and Steel, Fushun Special Steel, and Baotou Steel have reduced losses or achieved profits through differentiated business strategies. Ge Xin believes the steel industry has completely bid farewell to the era of scale expansion, and future core competitiveness will focus on high-end product layout, full-process cost control, and upstream mineral resource support. In the short term, the traditional off-season in July and August combined with high raw material prices will limit the room for profit recovery for most steelmakers. In the medium to long term, the commissioning of high-grade iron ore from Simandou in Guinea in the second half of the year and the implementation of domestic policies to ensure coal mine supply and increase production are expected to ease raw material cost pressures.

Xinyu Steel disclosed its earnings forecast, expecting a net loss attributable to the parent company of 588 million to 613 million yuan in the first half of 2026, compared with a profit of 111 million yuan in the same period last year. The company's net loss after deducting non-recurring items is expected to be 690 million to 715 million yuan, compared with a loss of 61.4537 million yuan in the same period last year. The announcement said that the steel industry's prominent supply-demand contradiction, high and volatile raw material prices, combined with the company's system-wide maintenance of blast furnaces and supporting systems at the beginning of the year, which led to a decline in production and sales scale and an increase in maintenance costs, as well as the provision for personnel reform costs, jointly led to the expected loss in the first half of the year. However, after the completion of the major overhaul in the second quarter, production returned to normal, and the company expects to achieve a net profit attributable to the parent company of 120 million to 145 million yuan in the second quarter, an improvement from the previous quarter.