Hong Kong – 28 August 2026 – China Lesso Group Holdings (China Lesso) reported a 25.6% year-on-year decline in first-half 2026 net profit to RMB0.70 billion as China’s softer construction cycle, fiercer price competition and higher other expenses outweighed solid export growth.
Revenue slipped 4.5% to RMB11.91 billion, led by a 5.3% fall in the core plastic piping systems division to RMB10.28 billion. Domestic sales weakened, with Southern China down 10.3% and the rest of China down 6.2%. By contrast, overseas markets delivered 36.2% revenue growth, lifting their contribution to 12.1% of group turnover (1H25: 8.5%).
Gross profit edged 2.5% lower to RMB3.43 billion, yet the gross margin improved 0.6 percentage points to 28.8%, reflecting strategic raw-material procurement and cost controls. EBITDA decreased 17.0% to RMB2.05 billion, while the EBITDA margin narrowed to 17.2% (1H25: 19.8%). Profit before tax fell 27.4% to RMB0.95 billion, pressured by a RMB225.0 million reduction in other revenue and gains and a 38.2% rise in other expenses to RMB0.81 billion. Finance costs declined 19.9% to RMB0.30 billion on a lower average funding cost.
Segment detail
• Plastic piping systems: Accounted for 86.3% of sales; volume slipped 3.2% to 1.21 million tonnes and ASP eased 2.2% to RMB8,502 per tonne. Gross margin improved to 30.0% (1H25: 29.4%).
• Building materials & home improvement: Revenue inched up 1.9% to RMB0.87 billion, representing 7.3% of the total.
• Other businesses (environmental protection, new energy, supply-chain services): Combined sales dipped 1.0% to RMB0.75 billion.
Balance-sheet highlights
Cash and bank deposits fell to RMB4.57 billion from RMB6.52 billion at end-2025, while total debt stood at RMB17.99 billion. Net current liabilities widened to RMB1.25 billion, trimming the current ratio to 0.94. Gearing edged down to 41.4%. Capital expenditure reached RMB1.12 billion, mainly for overseas plants and investment properties. The board maintained a cautious stance and omitted an interim dividend.
Strategic focus
Management reiterated six priorities: sharpening focus on core piping, accelerating overseas localisation, optimising business mix, tightening risk control, upgrading product and customer structures, and streamlining the capital structure. Between 2026 and 2030, China’s plan to invest around RMB5 trillion in urban underground pipeline networks is expected to underpin long-term demand, while international expansion—already spanning Southeast Asia, Africa, Central Asia and North America—should diversify growth and earnings.
The board expressed confidence in the company’s resilience and long-term prospects, underscoring its ambition to solidify China Lesso’s position as a global leader in piping and building-materials solutions.
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