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China’s Jihong Technology released its 2026 semi-annual report, posting first-half revenue of 3.74 billion yuan (approximately $554.0 million), up 15.53% year-on-year. Net profit attributable to shareholders reached 158 million yuan (approximately $23.4 million), up 33.52%, while non-GAAP net profit rose 30.98% to 148 million yuan (approximately $21.9 million). Basic earnings per share came in at 0.36 yuan. The company plans to distribute a cash dividend of 1.4 yuan per 10 shares. By segment, cross-border social e-commerce revenue grew 15.82% to 2.45 billion yuan (approximately $363.5 million), with segment net profit surging 80.92% to 100 million yuan (approximately $14.8 million), driven by expansion into Northeast Asia and Europe plus digital operational efficiency gains. The packaging business posted revenue of 1.28 billion yuan (approximately $190.3 million), up 15.04%, but segment net profit fell 31.62% due to rising raw material costs, intensifying competition, and new facility ramp-up expenses. As of end-June, total assets stood at 4.92 billion yuan (approximately $729.8 million), up 13.85% from the start of the year, while operating cash flow reached 302 million yuan (approximately $44.8 million), up 65.60%.
Key Elements
China’s Jihong Technology (002803.SZ) disclosed its 2026 semi-annual report on August 17, reporting first-half revenue of 3.74 billion yuan (approximately $554.0 million), up 15.53% year-on-year. Net profit attributable to shareholders of the listed company was 158 million yuan (approximately $23.4 million), up 33.52%. Net profit attributable to shareholders excluding non-recurring items was 148 million yuan (approximately $21.9 million), up 30.98%. Basic earnings per share came in at 0.36 yuan. The company also announced plans to distribute a cash dividend of 1.4 yuan per 10 shares to all shareholders.
The double-digit growth in both revenue and net profit was primarily driven by the strong performance of the cross-border social e-commerce business and steady expansion of the packaging business. From a cash flow perspective, net cash flow from operating activities in the first half reached 302 million yuan (approximately $44.8 million), a substantial increase of 65.60% year-on-year, indicating improved earnings quality.
Cross-Border Social E-Commerce Emerges as Primary Growth Engine
These figures indicate that Jihong Technology’s refined operational strategy in overseas markets is generating tangible returns. The net profit margin of the cross-border social e-commerce business improved from approximately 2.6% in the same period last year to approximately 4.1%, marking a significant enhancement in profitability.
In the packaging business, first-half revenue reached 1.28 billion yuan (approximately $190.3 million), up 15.04% year-on-year, with growth momentum primarily coming from rising demand from major customers in food packaging and other sectors. However, segment net profit attributable to shareholders was 51.73 million yuan (approximately $7.7 million), down 31.62% year-on-year. The company noted that the profit decline was due to short-term increases in raw material prices, intensifying market competition, and new production bases both in China and overseas still being in the investment phase.
| Business Segment | Revenue (100M yuan) | YoY Change | Net Profit (100M yuan) | YoY Change |
|---|---|---|---|---|
| Cross-Border Social E-Commerce | 24.51 | +15.82% | 1.00 | +80.92% |
| Packaging Business | 12.83 | +15.04% | 0.52 | -31.62% |
Note: Packaging business net profit attributable to shareholders is precisely 51.73 million yuan
Balance Sheet and Cash Flow Performance
As of June 30, 2026, Jihong Technology’s total assets stood at 4.92 billion yuan (approximately $729.8 million), up 13.85% from the beginning of the year. Shareholders’ equity attributable to the listed company was 2.77 billion yuan (approximately $411.4 million), up 2.80% from the start of the year. The significantly faster growth in total assets compared to net assets reflects the company’s increased investment on the asset side during the reporting period, consistent with the description of new packaging production bases being in the investment phase.
Net cash flow from operating activities was 302 million yuan (approximately $44.8 million), up 65.60% year-on-year. The improvement in cash flow outpacing net profit growth suggests enhanced collection capability and working capital management efficiency.
The company’s proposed cash dividend of 1.4 yuan per 10 shares, based on the current total share capital, amounts to approximately 53 million yuan (approximately $7.9 million) in total distributions, representing a payout ratio of approximately 33.6% relative to first-half net profit attributable to shareholders, continuing its emphasis on shareholder returns.
A Milestone Signal in Business Structure Transformation
Jihong Technology’s semi-annual report reveals the differentiated performance of its current business portfolio: the high-growth cross-border social e-commerce business is progressively replacing the traditional packaging business as the core profit growth driver. The cross-border social e-commerce segment, with less than two-thirds of revenue share, contributed approximately 63.5% of net profit attributable to shareholders, with profit growth far exceeding that of the packaging business.
The challenges facing the packaging business are more complex. Raw material cost volatility and intensifying industry competition represent external pressures, while the ramp-up phase investment in new production bases both in China and overseas constitutes a transitional cost of proactive expansion. If the new bases successfully commence production and release capacity, the packaging business’s profit margins are expected to recover over the medium to long term.
From a regional strategy perspective, the company has clearly identified Northeast Asia and Europe as priority expansion markets for cross-border social e-commerce. Both regions feature high e-commerce penetration rates and consumer purchasing power, but also present multiple challenges including localized operations and compliance requirements. Whether the company can sustain revenue growth while further improving profit margins will depend on the continuous iteration of its digital operational capabilities and the execution efficiency of its overseas localization teams.
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