Sinostar PEC Holdings posted a net profit of RMB 164.6 million for the six months ended Jun 30, 2026, a 184.7 per cent year-on-year jump, driven by a sharp recovery in gross margins at its core gas separation business.

Basic and diluted earnings per share rose to 17.14 RMB cents from 6.02 RMB cents a year earlier. The board did not propose an interim dividend, citing the need to preserve cash amid volatile feedstock prices.

Group revenue edged down 1.1 per cent YoY to RMB 2.61 billion. The gas separation segment remained the main contributor, generating RMB 2.39 billion in external sales, while transport and logistics services added RMB 219.7 million. Pre-tax earnings from gas separation surged to RMB 192.4 million (1H25: RMB 89.3 million), offsetting a decline in logistics profit to RMB 2.2 million (1H25: RMB 12.3 million). Overall gross profit more than doubled to RMB 212.7 million, lifting the margin to 9.1 per cent from 3.0 per cent.

Product-wise, MTBE revenue climbed 13.1 per cent to RMB 1.07 billion on higher selling prices and volumes, while premium-grade polypropylene slipped 1.4 per cent to RMB 813.1 million due to lower tonnage sold. Hydrogen and isobutylene sales increased 11.0 per cent and 7.9 per cent respectively, whereas processed LPG and propylene sales fell sharply following the 2025 merger of two subsidiaries and the retirement of a 50,000-tonne polypropylene line. Administrative expenses were cut by 55.7 per cent, reflecting reduced R&D spending, and finance costs dropped 40.9 per cent after loan repayments.

Looking ahead, Sinostar warned that the domestic polypropylene and MTBE markets are entering a “rebalancing phase” amid new capacity additions and tepid demand, which could pressure margins over the next 12 months. To mitigate these headwinds, the group plans to tighten cost controls, accelerate development of higher-margin specialty grades, and expand export sales to more overseas markets. Total offshore revenue accounted for 3.9 per cent of 1H26 turnover after the establishment of an international sales team in 2025.

The company ended the half with RMB 588.3 million in total cash and bank balances, including restricted deposits, and reduced outstanding bank borrowings to RMB 150 million, down from RMB 200 million at end-2025. Net asset value rose to RMB 1.83 per share from RMB 1.66 at Dec 31, 2025, supported by retained earnings.