ZENERGY (03677) achieved steady profitability in the first half of 2026, with net profit increasing by nearly 70% year-on-year. The energy storage business has become a second growth driver for development.

On August 31, ZENERGY (03677) released its interim performance report for 2026. During the reporting period, the company achieved operating revenue of 5.44 billion yuan, a year-on-year increase of 71.4%; net profit reached 370 million yuan, up 68.6%, continuing its growth trend; net cash flow from operating activities was 640 million yuan, an increase of 770 million yuan year-on-year, demonstrating good synergy between revenue growth and profit growth. Regarding the profit performance in the first half of the year, the companys management stated that in the first half of 2026, the domestic lithium battery industry continued its structural recovery trend, showing a dual growth pattern of structural iteration in power batteries and rapid expansion in the energy storage industry. Downstream market demand has seen some recovery, but uncertainties in the market persist due to fluctuating upstream raw material prices, differentiated industry capacity, and the escalation of overseas trade barriers. In the face of a complex and changing industry environment, the company adheres to a core strategy of stable operations, focusing on upgrading manufacturing capabilities and ensuring high-quality delivery while continuously deepening its internal refined management, rigorously controlling operating costs and various expense expenditures, effectively hedging against the risks of industry cycle fluctuations. From achieving a turnaround to profitability in 2024, significantly improving profit capabilities in 2025, to achieving simultaneous revenue and profit growth in the first half of 2026, ZENERGY is continuously consolidating its foundation for development, equipping equal importance to scale, efficiency, and quality. Specifically, driven by sustained industry demand growth, the companys shipment volumes for power battery and energy storage products have seen rapid growth, with revenue scale continually expanding. During the reporting period, upstream raw material prices increased in stages. Affected by long-term order arrangements and the business negotiation cycle with downstream customers, the transmission of costs to downstream experienced a certain lag. The new 10GWh factory was in a ramp-up phase in the first quarter, and the scale effect has not yet been fully released, indicating further room for improvement in the company's profitability. The company continues to advance refined operations, reduce costs, enhance efficiency, and control expenses, resulting in a continuous optimization of the expense ratio and achieving year-on-year net profit growth. Entering the second half of the year, all production lines are operating stably, maintaining a high capacity utilization rate, and newly constructed capacities are gradually entering stable production stages. As customer deliveries continue and cost transmission to downstream gradually aligns, the company's operational quality and profit resilience are expected to further improve. The power business is steadily improving, with structural optimization solidifying the profit foundation. The power battery business is the core support for ZENERGY's revenue and profit growth. ZENERGY continues to focus on the high-end market for passenger vehicles, adhering to a customer-centric approach and a focus on product competitiveness, continuously optimizing customer structures, product matrices, and capacity configuration efficiency to achieve high-quality and steady business growth. At the same time, the scale of overseas deliveries for several models from its core cooperative automotive clients has continued to rise, driving further release of related battery demand. In the first half of 2026, ZENERGY's domestic passenger vehicle installation ranking rose from seventh to fifth, further solidifying its market position. During the reporting period, the company has deepened refined operations, continuously advancing iterations of high-performance, high-cost-effectiveness, and high-safety power battery products, precisely matching the diverse, high-end, and intelligent needs of the downstream vehicle market. Meanwhile, the company dynamically optimizes capacity layout, continually enhancing capacity utilization rates and matching efficiency between production and sales, rigorously controlling production losses and operating costs, and continuously solidifying its profitability from three dimensions: customer quality, product performance, and production efficiency, ensuring stable operations in the power battery business and continuous core revenue contributions. The energy storage business has made rapid breakthroughs, creating a second growth pole. While consolidating its power battery fundamentals, the energy storage business is becoming a key cultivated second growth pole for the company. In the first half of 2026, the company's energy storage battery business achieved revenue of 590 million yuan, accounting for over 10% of total revenue, marking a significant year-on-year increase of nearly eightfold. Relying on its long-standing accumulation in cell research and development, intelligent manufacturing, and safety and quality management, the company continues to advance product iterations, capacity construction, and scenario expansion, driving high-quality and large-scale development of the energy storage business. Focusing on different application scenarios such as household storage, commercial and industrial storage, independent storage, and AIDC storage, the company continuously improves its energy storage product matrix. In the household storage field, its 104Ah and 314Ah standardized cells have become the main supply products in the global home energy storage market; to meet differentiated needs, customized versions of the 100Ah and 314Ah household storage products are expected to commence mass production in the second half of the year. For commercial and industrial storage, independent storage, and AIDC storage, the company has laid out multiple specifications of products including 100Ah/104Ah, 235Ah, 314Ah, 587Ah, and 588Ah, with plans to gradually achieve large-scale sales in 2026. Anchoring on the trends of large cell and long-duration energy storage development, the company has laid out a new product line compatible with the next generation of large-capacity cells and is developing large-capacity cell products above 1400Ah and 2700Ah, creating competitive products through extreme cost reductions while continuously refining storage solutions for complex scenarios. On the manufacturing side, the newly added 10GWh capacity at the end of 2025 is ramping up smoothly, and the new second phase capacity is expected to gradually come online in the fourth quarter of 2026, providing manufacturing guarantees for delivery and large-scale delivery in the long-duration energy storage business. Looking to the future, as the product matrix continues to improve, capacity scales gradually release, and application scenarios expand, the energy storage business will further enhance the companys growth momentum beyond automotive power batteries, improve the diversified business structure, and become an important support for the company's long-term growth. Smart manufacturing upgrades empower quality enhancement, with aviation quality building core barriers. During the reporting period, the company has continuously deepened its strategic layout for intelligent manufacturing, proactively implementing a digital upgrade system of AI + manufacturing to empower production quality and efficiency enhancement, cost reduction, and damage control. With stringent production standards, a green low-carbon production model, and advanced intelligent manufacturing levels, ZENERGY has successfully obtained the title of National Green Factory, with its brand influence and green production capabilities recognized at the national level. Currently, ZENERGY has built an advanced manufacturing system covering the entire process of "nano-level materials, micron-level manufacturing, and medical-grade testing," achieving high-standard control across the entire chain from raw material management, production, to finished product testing. Relying on its original "three-in-one manufacturing" management modewhere "logistics are workstations, workstations are manufacturing, and manufacturing is quality inspection"it has deeply linked the entire production process; simultaneously implementing a "three-degree management" system focusing on equipment reliability, product health, and personnel proficiency, strictly implementing the "three not-goals" of not producing, circulating, or releasing defective products, creating quality barriers with "aviation-level safety and automotive-grade applications." Through comprehensive upgrades in digitization, intelligence, and refinement, ZENERGY has continuously improved production efficiency, product yield, and delivery stability, effectively achieving cost reduction and efficiency enhancement, further strengthening the companys core operational resilience to navigate industry cycles. Gearing up for breakthroughs, steadily releasing long-term growth value. Looking ahead, as the technology routes for power batteries continue to iterate, and energy storage applications accelerate toward diversification and scale, competition in the lithium battery industry will increasingly focus on product value, manufacturing capability, operational efficiency, and sustainable development quality. In light of the new phase of industry development, ZENERGY will continue to be customer demand-oriented, relying on its long-standing technical, manufacturing, and quality management foundation to continuously enhance the overall competitiveness of its green energy business. Based on the solid operations in the first half of the year, the company will, while consolidating its competitive advantages in the power battery business, accelerate the rollout and ramp-up of new energy storage capacities, continuously improve its energy storage product matrix and scenario layout, and expand its diversified growth space; it will also leverage smart manufacturing upgrades and refined management to drive production efficiency and optimize the profit structure, steadily releasing operational flexibility. As various layouts gradually materialize, ZENERGY will create long-term, stable, and sustainable value for investors through a robust operational stance and continuous innovation capability.