Xuyang Group (01907) has seen a significant increase in profits, initiating a new round of growth. The three major pillar businesses are working together to construct a framework for certain growth.

In terms of industrial layout, CHINA RISUN GP (01907) has initially formed a preliminary structure with three pillar industries: chemicals, coke, and new energy, advancing simultaneously. Its latest disclosed interim performance for the year 2026 showcases the companys comprehensive repair of financial indicators and the accelerated release of growth potential after undergoing a previous industry downturn. The companys mid-term report indicates that in the first half of this year, Xuyang Group's revenue increased by 5.2% year-on-year to 21.856 billion yuan, while net profit surged by 376% year-on-year to 244 million yuan, with basic earnings per share reaching 4.77 cents, a remarkable rise of 736.8% year-on-year. Core financial data across the board warmed up, marking that this lead independent coke manufacturer globally is gradually emerging from the industry adjustment cycle and has strongly initiated a new round of high-quality growth. Notably, as fundamental conditions warmed up, Xuyang Group increased its dividend payout, with the board of directors declaring an interim dividend of 1.44 cents per share, rewarding shareholders with real returns. Crossing the turning point to restart a new round of high-quality growth In the over thirty years of development of Xuyang Group, 2026 is destined to be a significant year. In the first half of this year, Xuyang Group completed a scheduled acquisition of 14.5% equity in Tianjin Binhai Energy & Development, with the latter's controlling shareholder changing to Xuyang Group. It must be pointed out that this change is an optimization of the shareholding structure within the same actual control system, with the actual controller remaining unchanged. Thus, Xuyang Group's dual listing platform strategy of coordinated development in Hong Kong stocks and focused on new energy in A-shares has officially been implemented, expanding the Group's industrial layout from two pillars of chemicals and coke to a new pattern of three growth engines: chemicals, coke, and new energy progressing simultaneously. It is precisely in this year that Xuyang Group, after undergoing an industry cycle bottom, declared the arrival of a performance turning point with a mid-term report showing growth in both revenue and net profit. Looking item by item, in the chemicals sector, revenue from the fine chemicals production business during the reporting period grew by 4.2% year-on-year to 9.475 billion yuan, while gross profit surged from 655 million yuan in the same period last year to 926 million yuan, an increase of 41.4%. Gross profit margin rose from 7.2% to 9.8%. The core variable driving this growth was the significant rebound in prices of the companys main chemical products. Against the backdrop of industry anti-involution, companies like caprolactam and hydrogenated benzene have actively reduced production to stabilize prices, improving the supply-demand structure, with the average price of caprolactam rising 13.3% year-on-year to 9,701 yuan/ton. Coupled with rising prices of upstream raw materials like pure benzene and cyclohexanone forming rigid cost support, this collectively drove the price recovery of chemical products. At the same time, due to reduced methanol supply and increased demand, methanol prices steadily increased, with Xuyang benefitting from stable raw material supply and the rigid cost advantage brought by the methanol production process of coke oven gas, resulting in substantial profitability from the methanol-ammonia production line. In the coke business, revenue from coke and coking product production increased by 9.6% year-on-year to 6.966 billion yuan, with gross profit rising 10.5% year-on-year to 953 million yuan, maintaining a gross profit margin of 13.7%. During the reporting period, the average price of coke rose 11.3% year-on-year to approximately 1,515 yuan/ton. The company maintained the coal-coke price difference at over 300 yuan/ton through precise coal blending management and cost control. Against the backdrop of overall excess capacity in the coke industry, Xuyang leveraged its status as the world's largest independent coke producer and the integrated advantages accumulated over 31 years in sales, transportation, production, supply, and research, achieving a robust counter-cyclical performance. During the period, Xuyang Group's overseas markets also performed outstandingly; thanks to the increase in production capacity from newly constructed and resumed blast furnaces globally, as well as favorable factors like Indias lifting of quotas, Xuyang's operations in Indonesia saw revenue, net profit attributable to the parent company, and sales increase year-on-year by 976%, 1,854%, and 61%, respectively. The new energy sector demonstrated strong growth momentum, with revenue from the production business of new energy products soaring 122.9% year-on-year to 523 million yuan, while gross profit significantly improved from a loss of 12.95 million yuan in the same period last year to a profit of 58.26 million yuan, and the gross profit margin jumped from -5.5% to 11.1%. Increased shipment volumes of negative electrode materials and expanded graphitization capacity were the main drivers; the nations only 580MW source-grid-load-storage projects first phase of 150MW officially commenced trial operation, further consolidating Xuyang Group's cost competitiveness in new energy business. Beyond the three pillar industries, in the first half of the year, Xuyang Group's operations management and trading business also featured highlights. The operations management business benefitted from new project implementations, with revenue increasing by 46.2% year-on-year to 1.863 billion yuan and gross profit margin rising from 4.8% to 8.1%; though trading business saw some revenue fluctuations due to the active reduction of lower-margin projects, gross profit actually grew by 116.8%, indicating significant results from business structure optimization. During the reporting period, Xuyang Group's overall gross profit reached 2.311 billion yuan, with the gross profit margin improving from 8.1% in the same period last year to 10.6%, and net profit margin rising from 0.2% to 1.1%. The synchronous recovery of profitability indicators across various dimensions further confirmed that Xuyang Group achieved genuine high-quality growth at the turning point of the industry cycle. Three pillar businesses collaboratively build a deterministic growth pattern After surpassing the performance turning point, Xuyang Group's growth potential is expected to continue accelerating along with the synergistic efforts of the three pillar industries of chemicals, coke, and new energy. As the largest segment in Xuyang Group's business landscape, the chemicals sector demonstrated a robust recovery trend in the first half of the year. From an industry perspective, the collective rebound of chemical product prices in the first half was no coincidence, as most products have a foundational basis for sustained increases. Currently, anti-involution has become a consensus action in the chemical industry, with companies in caprolactam and hydrogenated benzene taking the lead in cutting production to stabilize prices, and the next phase is likely to transmit to more chemical products, implying that the supply-demand improvement pattern in the entire industry will continue to deepen. Moreover, Xuyang Group itself is continuously extending into higher value-added segments along its existing industrial chain. Previously, the 50,000 tons/year adipamine product, which was independently developed by Xuyang, has gone into production and achieved full production and sales, with quality widely recognized by downstream customers. It can be expected that with the chemical sector advancing from the cycle bottom to performance release, combined with the incremental contribution from high value-added fine chemical products, Xuyang Group's chemical operations will continue to unleash strong performance growth momentum. The coke sector, as a long-standing foundation for Xuyang Group, has shown consistent stability through cycles. Reviewing recent market performance, coke has exhibited a rapid upward movement, with the first and second rounds of price increases implemented one after another and the third round already commencing. Tracing the underlying supply-demand relationship, coke enterprises in the supply side have proactively reduced production due to deep losses, with both capacity utilization rate and daily average output declining, leading to a continuous contraction in supply; while in terms of demand, although molten iron production from steel mills showed a slight month-on-month decline, it remains high overall, with rigid demand for coke still present, and declining steel mill inventories further validating the tightened supply-demand pattern. In the medium to long term, despite ongoing excess capacity in the coke industry, under the backdrop of sustained anti-involution, Xuyang is expected to further enhance its market share owing to its leading position, continually transforming scale advantages into stronger bargaining and cost control capabilities. The new energy sector, on the other hand, represents a highly promising new growth driver for Xuyang Group. Relying on the Ulanqab industrial base, Xuyang Groups core subsidiary Tianjin Binhai Energy & Development has established over 100,000 tons of artificial graphite negative electrode capacity; the 200,000 tons integrated project is expected to be fully operational by the end of this year, with annual shipments projected to reach 130,000 tons; the supporting 580,000-kilowatt source-grid-load-storage green electricity project is set to be put into production in batches within this year, covering more than 50% with green power, constituting a rare supporting model in the industry that significantly reduces production costs while meeting export carbon accounting requirements. Additionally, Tianjin Binhai Energy & Development has also laid out silicon-carbon and porous carbon new negative electrode materials, forming a complete matrix of lithium battery materials. With the cost and supply chain advantages from green power + materials along with the rapid deployment of new production capacity, it is anticipated that Xuyang Group's third growth curve will speedily take shape and contribute significantly to performance increments. In terms of hydrogen energy business, the first domestic set of commercial 5 tons/day hydrogen expansion refrigeration hydrogen liquefaction project in the Dingzhou Park was completed and put into production in May. This is the countrys first comprehensive demonstration project of liquid hydrogen "production-storage-transportation-application" for civilian use, filling the domestic gap in the liquid hydrogen industry for civilian use. In the future, Xuyang Group will continue to focus on the rapid development of the hydrogen energy industry in the Beijing-Tianjin-Hebei region, using advanced technology and more customer-oriented services to extend the intelligent supply chain of hydrogen across the country. Overall, for the current Xuyang Group that has crossed the turning point, the logic of value reassessment is already clear: in the short to medium term, price increases in chemicals will continuously bring performance elasticity, while the release of new production capacity in the new energy sector will also contribute considerable performance increments to the company; looking further into the long term, the anti-cyclical development capability built by the coordinated development of the three industries of chemicals, coke, and new energy will continuously amplify the visibility and sustainability of Xuyang Groups growth.