Hong Kong – China Sunshine Paper Holdings Company Limited (Sunshine Paper) released its unaudited interim results for the six months ended 30 June 2026, revealing solid top-line growth offset by a sharp decline in earnings as surging input costs squeezed profitability.

Revenue climbed 20.2% year-on-year to RMB4.30 billion, driven by a 17.5% increase in paper sales volume to 1.14 million tonnes and firmer average selling prices across key product lines. Paper products contributed 95.5% of group turnover, with specialised paper (RMB1.21 billion) and coated white-top linerboard (RMB0.91 billion) the largest contributors.

Gross profit slipped 3.5% to RMB519.60 million, pushing the gross margin down to 12.1% from 15.1% a year earlier. Management cited higher raw-material and energy costs as the primary drag.

Operating expenses rose in absolute terms yet improved against revenue: distribution and selling costs represented 4.4% of sales (1H 2025: 5.1%), while administrative expenses accounted for 6.7% (1H 2025: 6.8%). Finance costs were broadly stable at RMB61.25 million.

Profit attributable to owners fell 30.7% to RMB57.65 million, translating into basic earnings per share of RMB0.06. The effective tax rate stood at 46.3%.

Balance-sheet indicators weakened modestly. Cash and restricted deposits totalled RMB3.05 billion, while total borrowings and lease liabilities reached RMB4.51 billion. Net gearing edged up to 27.1% (31 Dec 2025: 26.4%), and the current ratio slipped to 0.81x. Inventories and trade receivables rose to RMB714.0 million and RMB932.81 million respectively, with turnover days of 34 and 38.

Capital expenditure amounted to RMB472.70 million, mainly for capacity expansion and supporting facilities. Committed but not yet incurred capex stood at RMB1.59 billion.

Management Outlook The board expects domestic paper demand to remain subdued amid high raw-material prices and intensified industry competition. Strategic priorities for 2H 2026 include tighter cost control, operational efficiency gains and accelerated digitalisation to stabilise profitability. No interim dividend was declared.

The company confirmed no significant events after the reporting period.