XINYUREN ORD A (SHH) EQSW Exp:

Xinyuren published its 2026 interim report on August 26. During the reporting period, it achieved operating revenue of 207 million yuan, up 139.53 percent year on year, but net profit attributable to the parent company was negative 80.94 million yuan, a slightly wider loss than the negative 72.41 million yuan in the same period last year. Net profit after deducting non-recurring items was negative 82.36 million yuan. Net cash flow from operating activities was negative 5.49 million yuan, turning from a net inflow of 28.80 million yuan in the same period last year to a net outflow. As of the end of the reporting period, the company's inventory reached 1.043 billion yuan, a sharp increase of 60.26 percent from the beginning of the period, mainly due to a substantial increase in goods shipped. The company's core revenue comes from lithium battery drying equipment, which generated 181 million yuan in revenue during the reporting period, driven mainly by optimization of the customer structure and concentrated delivery of orders from leading customers. Revenue recognized in the second quarter was 124 million yuan, up 48.19 percent quarter on quarter. However, the rapid revenue growth did not translate into profit, mainly because orders from newly acquired leading customers are still in the early stage of cooperation, and the company adopted a lower pricing strategy, resulting in low gross margins. At the same time, high inventory tied up a large amount of working capital. The company invested 21.84 million yuan in research and development, focusing on frontier areas such as dry electrode equipment and solid-state electrolytes, and the first prototype of a dry electrode test machine has been completed. Looking ahead, the lithium battery equipment industry is being driven by downstream capacity expansion and energy storage demand, and market demand is recovering, but intensifying price competition in the industry may continue to squeeze profit margins. Attention should be paid to gross margin improvement, the pace of inventory conversion, and cash flow recovery.

Xinyuren released its 2026 interim report, with total operating revenue of 207 million yuan and net profit attributable to the parent company of negative 80.9399 million yuan, a decrease of 8.5335 million yuan compared with the same reporting period last year, widening the loss. Net cash flow from operating activities was negative 5.4851 million yuan, a year-on-year decrease of 34.2893 million yuan, down 119.04%. The company's asset-liability ratio rose to 88.36%, gross margin fell to 4.85%, ROE was negative 26.92%, and diluted earnings per share was negative 0.83 yuan.

Xinyu Guoke released its 2026 interim report. First-half net profit attributable to the parent was 17.7193 million yuan, down 32.76% year on year, while operating revenue was 157 million yuan, down 4.27%. Net profit excluding non-recurring items fell 45.28%, and net cash flow from operating activities turned from positive to negative at minus 29.9148 million yuan, a decline of 545.71%, mainly due to increased cash outflows for purchasing goods, paying taxes, and operating-related payments. Overall gross margin fell to 40.21% from 48.60% in the same period last year. Pressure on net profit came from a 22.07% decline in military product revenue and an 11.37% rise in operating costs, compounded by pressure from military product pricing and cost control. By product, military product revenue was 89.1244 million yuan with a gross margin of 37.70%, down 10.21 percentage points year on year. Civilian product revenue was 62.0879 million yuan, up 29.38% year on year, with a gross margin of 46.10%, still higher than military products but down 5.94 percentage points year on year. Civilian product growth was driven by government bond projects for weather modification, but rising costs eroded profit. Other business revenue was 6.1187 million yuan, surging 208.44%. Regarding shareholders, Chairman Yuan Yougen reduced his holdings by 30,000 shares, General Manager Liu Aiping and Deputy General Manager He Guangming each reduced by 20,000 shares, and the two shareholding platforms Xinyu Kexin and Xinyu Guohui also made small reductions.

Xinyuren replied to the Shanghai Stock Exchange's annual report supervision inquiry letter, disclosing that the actual controller non-operationally misappropriated 37.107 million yuan of raised funds and assisted five customers in falsifying 76.1 million yuan of repayments. The actual controller transferred funds into accounts under their control through a supplier of the raised funds investment project, and as of the end of 2025, had repaid a total of 39.4868 million yuan in principal and interest. Regarding the assistance in falsifying customer repayments, the actual controller paid for goods on behalf of customers through methods such as guaranteed loans, involving a loan principal of 96.1 million yuan, of which 76.1 million yuan had not yet been repaid. The company has reversed the corresponding accounts receivable, and the actual controller treated this amount as a donation to the listed company. In 2025, the company's operating revenue was 261 million yuan, a year-on-year decrease of 57.99%, and the net loss attributable to the parent company was 471 million yuan, with the loss widening by 644.08% year-on-year, marking two consecutive years of substantial losses. The book balance of accounts receivable was 516 million yuan, of which those aged over two years accounted for 78.16%. A full bad debt provision of 109 million yuan was made for accounts receivable from Shandong Judian New Energy Co., Ltd. Shanghai Certified Public Accountants issued a qualified opinion audit report on the company's 2025 financial statements, as it was unable to obtain sufficient evidence to prove whether the correction of prior accounting errors was accurate.