Dongyue Group (189) H1 2026 earnings summary

Executive summary

• Revenue for H1 2026 rose 7.99% year-over-year to RMB8.06 billion, with net profit up 54.7% to RMB1.63 billion and gross margin improving by 8 percentage points to 37.18%.

• Strong performance was driven by higher prices and demand in core segments: fluoropolymers, refrigerants, and organic silicon, with effective cost control despite higher raw material costs.

• R&D investment increased 14.98% year-over-year, accounting for 5.27% of revenue, with 12 new patents granted and 478 patents held at period end.

• Major projects completed include the New Energy Center and R32 refrigerant capacity expansion, enhancing operational efficiency and market readiness.

Financial highlights

• Revenue: RMB8,059,974,000 (+7.99% YoY); Net profit: RMB1,634,012,000 (+54.7% YoY); EPS: RMB0.60 (+27.7% YoY).

• Gross profit reached RMB2,996.46 million, up from RMB2,172.42 million year-over-year; gross margin: 37.18% (2025: 29.11%); operating margin: 24.45% (2025: 19.00%).

• Net cash position: RMB6.07 billion; current ratio: 2.90; net cash-to-equity ratio: 28.32%.

• Capital expenditure: RMB854.6 million, mainly for new projects and equipment.

• No interim dividend declared for H1 2026.

Outlook and guidance

• Plans to streamline and focus R&D on AI, semiconductors, and new energy, accelerating commercialization.

• Enhanced sales strategies for new products, with dedicated promotion teams and digital upgrades for safety/environmental management.

• Further upgrades to safety and environmental standards, aiming for zero-accident, zero-waste, and green industrial parks.

• Comprehensive risk management to address market, operational, and compliance uncertainties in H2 2026.

• Management remains cautious due to market volatility and aims to maintain stable operations and long-term growth.