China Risun Group (1907) H1 2024 earnings summary

Executive summary

• Revenue for the six months ended June 30, 2024, rose 21.0% year-over-year to RMB25,208.8 million, driven by higher sales volumes in coke, refined chemicals, and hydrogen products.

• Net profit attributable to owners dropped 84.4% year-over-year to RMB111.9 million, mainly due to lower average selling prices for coke and increased costs.

• The company maintained its position as the world's largest independent coke producer and leading player in several refined chemical segments.

• Interim dividend declared at RMB0.78 cents per share, a significant reduction from RMB4.90 cents per share last year.

Financial highlights

• Gross profit increased 24.2% year-over-year to RMB1,854.6 million, with gross margin up slightly to 7.4%.

• Net profit margin fell to 0.5% from 3.4% a year earlier; EBITDA margin was 8.1%, down from 9.1%.

• Basic EPS was RMB2.54 cents, down 84.3% year-over-year.

• Total borrowings increased 17.1% to RMB30,090.8 million as of June 30, 2024.

• Coke and refined chemicals volumes increased 14.9% and 19.0% year-over-year, respectively; high-purified hydrogen volume surged 98.9%.

Outlook and guidance

• Plans to expand annual coke and refined chemicals capacity, targeting new markets with high demand and low domestic supply.

• Construction of Pingxiang Production Base (1.8 million tons annual coke capacity) expected to complete by end of 2025.

• Active participation in hydrogen industrialization projects in multiple Chinese cities, aiming to become a leading clean hydrogen supplier.

• Targeting completion of the Sixth Five-Year Plan by 2025, aiming for 30 million tons annual coke processing capacity.

• Focus on maximizing product price spreads through coal diversification and digital technologies.