Shandong Hualu-Hengsheng Chemical (600426) investor relations material

Executive summary

• Revenue reached ¥30.97 billion, down 9.52% year-over-year due to intensified industry supply-demand imbalance and lower product prices; net profit attributable to shareholders was ¥3.32 billion, down 15.04% year-over-year.

• Operating cash flow was ¥4.20 billion, down 15.51% year-over-year, mainly due to reduced cash inflow from product sales.

• The company maintained industry-leading operational indicators despite a challenging market, with significant investments in new projects and capacity upgrades.

• Dividend proposal: cash dividend of ¥2.50 per 10 shares (tax included) and 3 bonus shares per 10 shares.

Financial highlights

• Gross margin for the year was 19.31%, up 0.44 percentage points year-over-year.

• Basic and diluted EPS were both ¥1.563, down 15.10% year-over-year.

• Weighted average ROE was 10.32%, down 2.73 percentage points year-over-year.

• R&D investment reached ¥1.26 billion, accounting for 4.07% of revenue, with 29.64% capitalized.

• Total assets at year-end were ¥49.18 billion, up 5.40% from the previous year.

Outlook and guidance

• 2026 sales revenue is projected at ¥33.5 billion, reflecting expectations of market recovery and new project contributions.

• The company will focus on high-end, green, and intelligent transformation, aiming to strengthen cost control and product upgrades.