China Treasures New Materials (2439) H1 2025 earnings summary

Executive summary

• H1 revenue fell 21.8% YoY to RMB153.886m as weaker domestic demand and online shopping reduced supermarket orders for biodegradable bags and produce rolls.

• Net profit declined 25.7% to RMB35.758m; the Changchun production base is under construction, with trial operations and production expected to start in November 2025.

Financial highlights

• Revenue was RMB153.886m versus RMB196.868m; gross profit was RMB60.334m versus RMB78.4m, and profit before tax was RMB42.357m versus RMB56.469m.

• Profit attributable to owners was RMB35.534m versus RMB47.834m; cost of sales declined 21.0% to RMB93.552m.

• Other income rose to RMB2.115m from RMB0.920m; administrative and other operating expenses fell to RMB14.385m from RMB18.717m, while finance costs increased to RMB3.440m from RMB1.745m.

• Operating cash flow was RMB68.0m, investing cash outflow RMB254.6m and financing cash inflow RMB162.9m; cash and cash equivalents were RMB398.974m at 30 June 2025.

Outlook and guidance

• Trial operations and production at the Changchun base are expected to commence in November 2025; construction was progressing to schedule.

• PRC restrictions on non-degradable plastic bags are expected to extend to marketplaces by end-2025, supporting prospective biodegradable-product demand.

• Management remained cautiously optimistic on the long-term market outlook, citing supportive policies and rising environmental awareness while noting near-term demand challenges.