On January 7, 2026, Sinochem International (Holdings) Co., Ltd. issued a preliminary announcement indicating an expected loss for the full year of 2025. Based on preliminary estimates, the company is projected to report a net loss for the year. The announcement revealed that as of the end of the third quarter of 2025, the net profit attributable to shareholders of the listed company had already reached -13.31 billion yuan. The specific and accurate financial data will be subject to the audited annual report for 2025.

Regarding the reasons for the performance loss, Sinochem International explained in the announcement that in 2025, the domestic chemical price index was in a downward trend due to supply-demand dynamics, and the industries in which the company's main products operate faced severe challenges. Despite implementing a series of countermeasures, including enhancing operational excellence, optimizing costs, and improving efficiency—resulting in significant reductions in energy and production costs—as well as reducing working capital usage, which led to positive operating cash flow and a substantial year-on-year improvement, the company's operating performance still encountered significant market challenges. This was primarily due to the continued year-on-year decline in market prices of key products such as propylene oxide, antioxidants, phenol-ketone, bisphenol A, nylon 66, and aramid fibers.

Public information shows that Sinochem International's main business covers five segments: basic raw materials and intermediates, high-performance materials, polymer additives, chemical material marketing, and others. The high-performance materials segment includes core products such as epoxy resins, ABS, nylon 66, aramid fibers, and functional fine chemicals. In 2025, the company continued to advance its business layout in the new materials sector. On October 28, its engineering plastics subsidiary, ELIX Polymers, officially launched the new PC/ABS GR5120 composite material for automotive interior upgrades. Prior to this, ELIX Polymers had collaborated with Cangzhou Dahua to complete the EU REACH certification for PC products by the end of 2024, gaining local market access and initiating a joint PC sales plan. On December 23, Luxi Chemical, Cangzhou Dahua, and Sinochem Plastics Co., Ltd., a wholly-owned subsidiary of Sinochem International, proposed to jointly invest in establishing Sinochem Polycarbonate Sales (Liaocheng) Co., Ltd., with a registered capital of 5 million yuan. This initiative aims to fulfill the commitment of state-owned shareholders to avoid同业竞争 and integrate sales resources.

Performance data indicates that Sinochem International has been in a continuous loss-making state since 2023. In the first three quarters of 2025, the company achieved operating revenue of 35.716 billion yuan, a year-on-year decrease of 9.56%. The net profit attributable to shareholders recorded a loss of 13.31 billion yuan, further expanding from the loss of 5.16 billion yuan in the same period of the previous year.

Against this backdrop, Sinochem International introduced a series of strategic adjustment measures intensively in 2025. On July 15, the company issued an asset restructuring announcement, proposing to acquire 100% equity of Nantong Xingchen, a wholly-owned subsidiary of Bluestar Group, to strengthen the development of the epoxy resin industry chain. It is understood that Nantong Xingchen is a leading domestic epoxy resin enterprise. Upon completion of the acquisition, Sinochem International's total epoxy resin production capacity will increase from 350,000 tons to 510,000 tons, solidifying its position as the top domestic producer. In September, its subsidiary Sinochem (Ningbo) Runwo Membrane Technology Co., Ltd. was acquired by DuPont. In October, its subsidiary Ningxia Sinochem Lithium Battery Material Co., Ltd. applied for bankruptcy reorganization. Prior to this, the investor of another lithium battery enterprise under its umbrella, Huaian Junsheng New Energy Technology Co., Ltd., had been changed from Sinochem International to Xingdong (Hebei) Lithium Battery Technology Co., Ltd.

Information shows that Sinochem International had previously focused on developing its new energy business, attempting to build a closed-loop industrial chain from upstream lithium resources to downstream new energy vehicle applications. In the field of cathode materials, the company planned and invested in the construction of 10,000 tons and 50,000 tons of NCM ternary cathode material capacity in Ningxia Zhongwei. It also collaborated with Jiangsu Leneng to explore the construction of a lithium iron phosphate cathode material production base. In the field of anode materials, it planned to phase in the construction of a 30,000-ton mesophase carbon microsphere anode material project in Cixian, Handan, Hebei. Simultaneously, the company ventured into the lithium battery recycling business by establishing Hebei Sinochem Lithium Battery Technology Co., Ltd. Additionally, the company had partnered with the German BMW Group to build the Sinochem International New Energy Yangzhou Base, planning to use the battery modules produced at this base for the BMW i3 model in 2022 and develop variant batteries for third-party customers.

Historical financial reports indicate that Sinochem International once had four lithium battery-related enterprises. According to the 2025 semi-annual report, apart from the bankrupt Junsheng New Energy and Ningxia Lithium Battery, only Hebei Sinochem Lithium Battery Technology Co., Ltd. and Sinochem Yangzhou Lithium Battery Technology Co., Ltd. remain as lithium battery-related enterprises.

Regarding the challenges in the lithium battery business, related information shows that due to factors such as overcapacity in the power battery industry and intensified price wars, Junsheng New Energy faced operational difficulties, while Ningxia Lithium Battery continued to incur losses and became insolvent, unable to repay its debts. This outcome was foreshadowed in Sinochem International's 2024 annual report, which explicitly stated that, in addition to the downturn in the chemical industry, the battery and some other businesses faced overcapacity and intensified competition, leading to continuously compressed profit margins. The company had already made impairment provisions for related long-term asset groups.

A series of strategic initiatives indicate that Sinochem International is accelerating the divestment of loss-making businesses and shifting its focus to the new materials sector. At the semi-annual performance briefing on September 30, 2025, in response to investors' inquiries about the future of the lithium battery business, Chairman Zhang Xuegong clearly stated that Sinochem International would focus on its core industrial chain in the future, aiming to build distinctive material industries such as epoxy resins, polymer additives, engineering plastics, and aramid fibers, which possess independent technology and integrated development advantages. No mention was made of the lithium battery business.