China XLX Fertiliser (1866) H1 2025 earnings summary

Executive summary

• Revenue for 1H2025 reached RMB12,666 million, up 5% year-over-year, driven by higher sales volumes despite lower product prices and initial supply-demand imbalances.

• Net profit attributable to the parent declined, with figures reported as RMB599 million (down 13% YoY) and RMB757 million (down 19% YoY), mainly due to product price declines outpacing cost reductions.

• Second quarter saw a strong rebound: gross profit rose 44% QoQ and net profit surged 104% QoQ, led by higher prices and volumes for urea and melamine.

• Gross profit margin fell, with urea gross profit down 44% YoY, partially offset by cost reductions and process optimizations.

Financial highlights

• Gross profit for 1H2025 was RMB2,040 million, down from RMB2,356 million in 1H2024.

• Basic EPS was RMB0.515, down from RMB0.564 in 1H2024.

• Other income, net, increased 79% YoY to RMB200 million, mainly from higher government grants and by-product sales.

• Finance costs decreased 14% YoY due to lower average loan rates and optimized debt structure.

• No interim dividend was declared for 1H2025.

Outlook and guidance

• Urea prices expected to remain stable in 2H2025, with potential for periodic upward movement due to coal price stabilization.

• Chemical product industry supply-demand is expected to improve, supporting a steady upward trend in industry prosperity.

• Expansion projects in Jiangxi and Xinxiang bases are on track, with full capacity release expected by 2027, supporting long-term growth.