China Modern Dairy (1117) H1 2026 earnings summary

Executive summary

• Revenue increased by 8.6% year-over-year to RMB 6,593 million in 2026H1, with net profit rebounding to RMB 42 million from a loss of RMB 984 million in 2025H1, driven by both raw milk and integrated dairy farming solutions.

• The acquisition of China Shengmu Organic Milk Limited (CSM) was completed, making the group the largest shareholder and expanding access to organic milk supply.

• Integrated dairy farming solutions revenue surged 18.9% year-over-year, while raw milk business grew 6.5%.

• Strategic focus on digital services, overseas markets, and full industrial chain integration diversified profit drivers.

• The group maintained industry-leading product quality, with its pure milk brand winning the Monde Selection gold medal for 13 consecutive years and MSCI upgrading its ESG rating to AA.

Financial highlights

• Gross profit increased 7.7% year-over-year to RMB 1,727 million; gross margin slightly decreased to 26.2%.

• Cash EBITDA grew 8.3% year-over-year to RMB 1,599 million, with margin stable at 24.3%.

• Net cash from operating activities rose 56.8% year-over-year to RMB 768.5 million.

• Feed costs per kg dropped 1.7% year-over-year, and overall COGS per kg fell 1.3%.

• Basic EPS turned positive at RMB 0.20 cents from -11.67 cents.

Outlook and guidance

• Continued focus on digital transformation, smart animal husbandry, and expanding overseas markets.

• Focus on optimizing herd structure, improving milk yield, and enhancing raw milk quality.

• Plans to accelerate new business expansion, including breeding technology and digital platforms.

• Intends to extend the industrial chain and expand international business, leveraging technology and management exports.

• No interim dividend declared for the period.