Shenzhou International Group (2313) H1 2025 earnings summary

Executive summary

• Sales revenue for the six months ended 30 June 2025 reached RMB14,966 million, up 15.3% year-over-year, with net profit attributable to owners at RMB3,177 million, an 8.4% increase, both setting historical highs for the period.

• Gross profit increased 7.9% to RMB4,058 million, though gross margin declined by 1.9 percentage points to 27.1% due to higher labor costs.

• International sales grew strongly, especially in the US (up 35.8%), Europe (up 19.9%), and Japan (up 18.1%), while domestic sales declined 2.1%.

• Overseas production capacity expanded, with a new fabric factory in Vietnam nearing completion and a new garment factory in Cambodia commencing production in March 2025.

• Interim dividend declared at HKD1.38 per share, a 10.4% increase year-over-year.

Financial highlights

• Revenue: RMB14,966 million (up 15.3% year-over-year); net profit: RMB3,177 million (up 8.4%).

• Gross profit: RMB4,058 million (up 7.9%); gross margin: 27.1% (down 1.9 percentage points).

• Earnings per share: RMB2.11 (up from RMB1.95 year-over-year).

• Net cash from operating activities: RMB2,693 million (up from RMB2,310 million year-over-year).

• Interim dividend declared: HKD1.38 per share (up from HKD1.25 per share year-over-year).

Outlook and guidance

• Strategic focus on market expansion, capacity optimization, and institutional enhancement, with emphasis on technology empowerment, green development, and efficiency improvement.

• Plans to further automate and digitize production, expand product portfolio, and deepen customer and supplier relationships.

• Plans to expand overseas production capacity, especially in Vietnam and Cambodia, and upgrade domestic facilities for automation and efficiency.

• Industry faces challenges from tariff uncertainties, weak external demand, rising compliance and labor costs, but digital transformation and smart manufacturing are seen as key growth drivers.