Hilong Holding (1623) investor relations material

Executive summary

• Revenue for 1H2025 was RMB2,322.5 million, down 5.8% year-over-year, mainly due to declines in oilfield equipment manufacturing and services.

• Gross profit fell 30.6% to RMB401.4 million, with gross margin dropping to 17.3% from 23.5% a year earlier.

• Net loss attributable to equity owners was RMB324.2 million, compared to a profit of RMB46.0 million in the prior year period.

• Offshore engineering services revenue surged 86.0% year-over-year, driven by subsea pipeline and platform projects.

• The company is advancing technological innovation, digital transformation, and international market expansion.

Financial highlights

• Oilfield equipment manufacturing & services revenue dropped 36.7% year-over-year to RMB716.6 million; oilfield services revenue fell 8.6% to RMB843.7 million; offshore engineering services revenue rose to RMB762.2 million.

• Segment revenue mix shifted: offshore engineering services 32.8%, oilfield services 36.3%, equipment manufacturing 30.9%.

• Administrative expenses rose 4.9% to RMB243.8 million; selling and marketing expenses dropped 31.2% to RMB43.4 million.

• Net finance costs decreased 21.7% to RMB101.0 million.

• No interim dividend was declared for the period.

Outlook and guidance

• Management expects stable investment in crude oil extraction and continued growth in high-end international markets, especially the US, Middle East, and Southeast Asia.

• Plans include expanding high-tech product offerings, improving operational efficiency, and pursuing new business opportunities in both existing and new markets.

• Offshore engineering will focus on cost reduction, efficiency, and digital management to enhance profitability.

• Continued R&D in nanofluids, MPD, and intelligent drilling technologies; accelerate digital transformation and automation.

• Offshore engineering to pursue EPCIC projects and expand in Southeast Asia, Middle East, and South America.