PLA Market Oversupply, Hisun Biomaterials' Net Profit in the First Half Decreased by Nearly 90% Year-on-Year, Company Fundraising Project Delayed

On the evening of August 18,Haizheng BiomaterialsIn the disclosure of the 2025 semi-annual report for (688203), the company achieved a revenue of 408 million yuan in the first half of the year, a decrease of 5.28% year-on-year; the net profit attributable to shareholders was 3.1815 million yuan, a decrease of 87.32% year-on-year.

Hisun BiomaterialsThe company stated that the main reason for the significant decline in net profit was the year-on-year decrease in product prices during the reporting period, which narrowed profit margins, as well as a year-on-year reduction in interest income and government subsidies.

Haizheng BiomaterialsThe gross profit margin has significantly decreased. The semi-annual report shows that the company's gross profit margin is 9.87%, a year-on-year decrease of 3.72 percentage points.

The company is the first in China and the second in the world to commercialize the production of polylactic acid (PLA). Listed on the STAR Market in August 2022, the company’s main products are resin-form polylactic acid, which are used in low-temperature food contact packaging materials, fiber products, heat-resistant household items, disposable tableware, and 3D printing materials.

In the institutional survey conducted in June,Haizheng BiomaterialsThe executive stated that the current polylactic acid market is experiencing an oversupply, with a significant imbalance between supply and demand. In 2024, the global consumption of polylactic acid is expected to be around 260,000 tons, while domestic consumption in China will be about 120,000 tons. Market prices are affected by supply and demand conditions, and both domestic and international companies are expected to introduce new production capacities, which is likely to lead to a further decline in polylactic acid prices in the future. However, the current market price is already close to the cost line, so there won't be much fluctuation in pricing in the future.

Haizheng currently has a pure polylactic acid production capacity of 60,000 tons per year, and the company's existing production lines are operating near full capacity with full sales.

Haizheng BiomaterialsWith the tightening of domestic and international environmental protection policies and the steady advancement of the "plastic restriction and ban" timetable, the domestic polylactic acid (PLA) industry has gradually transitioned from a situation of "external dependency at both ends" to a "dual circulation" pattern of both domestic and international markets. The downstream markets for PLA products at home and abroad have rapidly expanded. Existing competitors of the company all have plans to increase PLA production capacity, and some enterprises have to varying degrees mastered PLA production technology and have already begun constructing new PLA production capacities.

Considering the macro environment, actual implementation of policies, and market conditions in recent years, the company has decided to extend the timeline for its projects funded by raised capital. The completion date for the 150,000-ton annual production capacity polylactic acid project (Phase I) is now extended to before December 2025, while the completion date for the 150,000-ton annual production capacity polylactic acid project (Phase II) is extended to before December 2028. As of the end of the reporting period, the civil engineering works for the 150,000-ton annual production capacity polylactic acid project are basically completed. For Phase I, the equipment installation and commissioning for the 75,000-ton annual production capacity polylactic acid production line, as well as the operation of the production auxiliary building and warehouse system along with personnel deployment, have been completed.