Heilongjiang Agriculture Company (600598) investor relations material

Executive summary

• Revenue for H1 2026 was RMB 2.13 billion, down 29.39% year-over-year, mainly due to a shift in fertilizer business model from direct sales to consignment, reducing reported sales revenue.

• Net profit attributable to shareholders was -RMB 536.51 million, a decrease of 154.5% year-over-year, primarily due to a one-time tax payment and penalty totaling RMB 1.41 billion.

• Basic and diluted EPS were both -0.302, compared to 0.554 in the prior year.

Financial highlights

• Operating income: RMB 2.13 billion, down 29.39% year-over-year.

• Net profit: -RMB 536.51 million, down 154.5% year-over-year.

• Operating cash flow: RMB 2.49 billion, down 32.68% year-over-year.

• Gross margin: 54.9%, up from 39% year-over-year due to lower cost of goods sold.

• Total assets: RMB 10.38 billion, up 15.92% from year-end 2025.

Outlook and guidance

• The fertilizer business model change is expected to reduce annual revenue by RMB 1.047 billion, but gross profit is expected to remain stable.

• The company expects the consignment model to be fully implemented in H2 2026, with related service income recognized in the second half.