Kangxin New Materials has replied to the Shanghai Stock Exchange's annual report inquiry, addressing issues concerning forestland assets, container flooring business, and going concern capability. As of the end of 2025, the company's consumable biological assets had a book balance of 3.467 billion yuan, and forestland use rights assets had a book value of 1.333 billion yuan, together accounting for about 72 percent of total assets. No inventory write-down provision was made, and the annual auditor considered the net realizable value to be higher than the book value, with sufficient judgment basis. In 2025, container flooring business revenue was 289 million yuan, down 41.33 percent year-on-year, with a gross margin of negative 27.50 percent, mainly due to a significant drop in market selling prices. Although self-produced output increased substantially, the economic benefits have not yet been fully realized. The company's 2025 revenue was 377 million yuan, down 37.24 percent year-on-year, with losses for multiple consecutive years and an expanding loss amount. Net cash flow from operating activities was negative 119 million yuan, the asset-liability ratio rose to 44.90 percent, and interest-bearing liabilities were about 1.693 billion yuan. However, the company stated that there is no risk of mandatory repayment in the next 12 months, and there is no material uncertainty regarding its going concern capability. In addition, the company expects a net loss attributable to the parent company of about 132 million yuan for the first half of 2026, mainly affected by rising costs, declining gross margins, and impairment provisions.
Kangxin New Materials Co LtdRevenue down 37%, container flooring gross margin negative 27.5%, losses expanding, and expected H1 2026 net loss of 132 million yuan.