Meilian New Materials’ Semiannual Report: Masterbatch and Cyanuric Chloride Under Pressure, Battery Separator Still in Loss

On August 26, 2025, Meilian New Materials released its semi-annual report. The report showed that the company's operating revenue for the first half of the year was 878 million yuan, an increase of 3.1% year-on-year. However, the net profit attributable to shareholders was -16 million yuan, a year-on-year decrease of 146.89%. During the reporting period, the company’s short-term loans amounted to 341 million yuan, an increase of 56 million yuan; long-term loans stood at 334 million yuan, a decrease of 34 million yuan. The total borrowings amounted to 675 million yuan, an increase of 22 million yuan over the half-year period.

The performance situation has indeed made many people concerned about Meilian New Materials break into a sweat. After all, in a fiercely competitive market environment, revenue growth but profit decline signifies considerable underlying issues.

Masterbatch segment: significant price reduction, shrinking profits

As one of Meilian New Materials' main products, masterbatch achieved an operating revenue of 340.3466 million yuan in the first half of the year, representing an 11.43% year-on-year increase. According to the sales data, the sales volume of masterbatch rose by 21.51% year-on-year. Although this significant growth in sales volume seems like good news, it is not necessarily so. The unit selling price decreased by 8.29% year-on-year, and although the unit cost also dropped by 5.91%, the overall gross margin was 11.94%, down 2.23 percentage points year-on-year.

Trichlorocyanuric Acid Segment: Gross Profit Margin Only 1%

The performance of the melamine cyanurate sector in the first half of the year was also less than satisfactory. While revenue declined, costs increased. Compared with the same period last year, the sales volume of melamine cyanurate products increased by 6.08% year-on-year, but the unit price decreased by 25.15% year-on-year. As a result, the gross profit margin was only 1.09%, down 23.41% year-on-year.

High-performance pigment and dye sector: outstanding performance

High-performance dyes exhibit outstanding performance, with a gross margin as high as 44.10%. This result reflects the essence behind it, which is "high profit potential," directly indicating that the product possesses strong "profit potential reserve" and "cost control capability."

According to available information, Huihong Technology, a subsidiary of Meilian New Materials, achieved an operating revenue of 44.4462 million yuan during the reporting period, representing a year-on-year increase of 10.07%, with sales revenue from EX electronic materials reaching 9.1162 million yuan. Huihong Technology possesses globally leading manufacturing technology for high-performance dyes and pigments. Its series of high-performance dyes and pigments—such as Orange 43, Red 15, Red 14, and their intermediates—feature excellent performance and enjoy a unique competitive advantage in the global market, currently constituting its main source of income. The masterbatch industry itself has limited profit margins and weaker R&D investment capabilities compared to upstream sectors, leading to a dilemma in “cost reduction and efficiency improvement” where there is the will but a lack of funds and technology. While such upstream technological barriers solidify the position within the industry chain and pose challenges to cost reduction and efficiency improvement in the masterbatch industry to some extent, they also compel the industry to actively explore breakthrough paths.

Battery separator sector: revenue improvement

The battery separator segment has seen some improvement in revenue, with a gross margin of -23.72%, representing a year-on-year increase of 112.52%, but it is still operating at a loss. It is understood that the low selling price of products from the subsidiary Anhui Meixin has been a key factor dragging down performance. During the reporting period, Anhui Meixin failed to contribute positive operating results to Meilian New Materials.

In the first half of 2025, Meilian New Materials exhibited a clear divergence in performance: the masterbatch and cyanuric chloride segments faced profit pressure, the battery separator segment had yet to escape losses, and only the high-performance pigments and dyes segment maintained high profitability due to its technical advantages.

For the masterbatch industry, Meilian New Material's semi-annual report is not only a reflection of a company's operations but also highlights the common challenges faced by the industry in its development. We hope to see companies within the industry find ways to overcome these difficulties and jointly promote more stable growth for the entire industry.