On September 21, 2026, Tong Petrotech Corp. (300164) announced that Wang Limo from Everbright Securities Company Limited conducted a research visit with the company that same day. During the session, Board Secretary Zhang Xu first presented an overview of the company's fundamentals and its operational performance for the first half of 2026, before addressing investor questions on key concerns.
Addressing inquiries about the first-half revenue decline, management attributed the downturn primarily to seasonal factors, noting that the company's business is typically unevenly distributed across the year. Delays in major client work plans and the postponement of bidding processes further weighed on first-half revenue, though operations are expected to gradually recover in the second half.
Regarding the company's successful bids in Algeria, Tong Petrotech Corp. highlighted its extensive domestic experience in natural gas processing projects, combined with nearly a decade of operations in North Africa through its associate company Yilonghengye. This track record enabled the company to secure the Algeria EPF and natural gas compressor project in October 2025, followed by a second win in June 2026 for the multiphase mixing pump and desalinated brine injection project.
On the contract signing timeline for both Algerian projects, the company explained that international contract negotiations typically take extended periods. To date, neither contract has been formally signed, and management is actively engaging with clients to expedite the process. The company reiterated its commitment to fulfilling information disclosure obligations strictly in accordance with relevant laws, regulations, and supervisory requirements.
Concerning potential risk factors for the Algerian ventures, Tong Petrotech Corp. acknowledged that contract signing remains uncertain until formal agreements are executed. During both the signing and implementation phases, policy shifts, market conditions, client financing arrangements, and other force majeure events could affect contract execution, timelines, and overall results. Additional overseas-specific risks include potential political changes, regulatory adjustments, foreign exchange controls, currency fluctuations, labor policies, and cultural differences. Once new projects are operational, there is also the possibility of underperformance or investment failure. To mitigate these risks, the company will diligently study local regulations and policy environments, conduct thorough pre-implementation research, make prudent decisions, adopt a scientifically grounded approach to planning, actively recruit and develop talent, and expand training programs to prevent and resolve potential issues. Investors are urged to make rational investment decisions and remain mindful of associated risks.
Tong Petrotech Corp.'s core business involves providing technical support and services for oil and natural gas exploration and development. According to its 2026 interim report, the company generated main business revenue of RMB 493 million in the first half, down 10.6% year-on-year. Net profit attributable to shareholders came in at RMB -24.64 million, a 163.78% decline from the prior year, while non-GAAP net profit fell 328.9% to RMB -31.06 million. In the second quarter alone, main business revenue totaled RMB 273 million, down 6.73% year-on-year, with attributable net profit of RMB -11.74 million (-131.01% year-on-year) and non-GAAP net profit of RMB -12.63 million (-194.18% year-on-year). The company's debt-to-asset ratio stood at 32.31%, with investment income of RMB -1.40 million, financial expenses of RMB 1.67 million, and a gross margin of 13.64%.
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