China Rare Earth Resources And Technology Co., Ltd. reported a decline in revenue alongside a sharp increase in profit for the first half of the year, reflecting a structural improvement in corporate profitability within the rare earth industry's current "price-for-volume" market environment.
The company's semi-annual report for 2026, released on August 7, showed net profit attributable to shareholders of listed companies reaching 237 million yuan in the first half, a year-on-year increase of 46.53%. After deducting non-recurring gains and losses, net profit stood at 240 million yuan, up 55.49% year-on-year. Meanwhile, operating revenue was 1.647 billion yuan, a decrease of 12.19% year-on-year.
Net cash flow from operating activities improved significantly, shifting from a net outflow of 45.6 million yuan in the same period last year to a net inflow of 711 million yuan, an increase of 1658.72%. This indicates a substantial enhancement in the company's actual operational quality and provides a key reference for assessing the sustainability of its earnings. The company's board of directors decided not to distribute cash dividends, issue bonus shares, or convert capital reserves into share capital for this period.
Revenue Falls While Profit Soars, Earnings Structure Clearly Optimized
The combination of a 12.19% decline in revenue and nearly 50% growth in net profit suggests that the company's earnings structure underwent a substantive change during the reporting period.
Looking at key financial indicators, basic earnings per share rose to 0.2233 yuan from 0.1524 yuan in the same period last year, an increase of 46.52%. The weighted average return on equity increased from 3.42% to 4.81%, up 1.39 percentage points. As of the end of the reporting period, the company's total assets stood at 5.956 billion yuan, up 3.82% from the end of the previous year. Net assets attributable to shareholders of the listed company were 5.063 billion yuan, up 5.33% from the end of the previous year.
The growth rate of net profit after deducting non-recurring gains and losses (55.49%) was higher than the net profit growth rate (46.53%), indicating that the company's core business contributed more significantly to profits, with limited interference from non-recurring items, leading to improved earnings quality.
Stable Shareholding Structure, State-Owned Shareholders Hold Over 30%
The company's shareholding structure remained stable, with no changes to the controlling shareholder or actual controller during the reporting period.
Among the top ten shareholders, state-owned legal entities held a relatively concentrated stake. China Rare Earth Group Industrial Development Co., Ltd. held 22.17%, making it the largest shareholder. Guangdong Guangcheng Holdings Group Co., Ltd. held 9.48%, and China Rare Earth Group Co., Ltd. held 6.39%. China Rare Earth Group Industrial Development Co., Ltd. and China Rare Earth Group Co., Ltd. are related parties, with the latter being the actual controller of the former.
In terms of foreign capital, Hong Kong Securities Clearing Company Ltd. held 2.81%, and J.P. Morgan Securities PLC held 0.37% with its own funds. As of the end of the reporting period, the total number of ordinary shareholders was 177,656.
Two Strategic Initiatives Underway, Strengthening Asset Integration and Capacity Layout
During the reporting period, the company had two major matters in progress, both aimed at enhancing core competitiveness and operational efficiency.
The first is internal asset integration. The company's board and shareholders' meeting have approved the proposed absorption and merger of its wholly-owned subsidiary, Zhongxi Ganzhou. Upon completion, Zhongxi Ganzhou's legal entity status will be dissolved, and all its assets, liabilities, debts, and other rights and obligations will be assumed by the company. This proposal was disclosed in August 2025, and related work is still ongoing.
The second is capacity relocation. The company's subsidiary, Guangzhou Jianfeng, due to the existing production site limiting long-term development, plans to acquire industrial land in Conghua District, Guangzhou, to implement a relocation project for rare earth deep processing and new material manufacturing. The company disclosed this plan in April 2026, stating that it aims to enhance high-quality and sustainable development capabilities. Related work is also in progress.
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