Yunnan Water (Yunnan Water Investment Co., Limited) reported a net loss of RMB 760.86 million (USD-equivalent USD 105 million) for the six months ended 30 June 2026, trimming last year’s deficit of RMB 1.05 billion by 27.33%. The loss remained driven by a sharp contraction in gross profit and heavy financing costs, partially offset by lower impairment charges and administrative expenses.
Revenue and margins • Revenue declined 8.29% year on year to RMB 1.06 billion, reflecting softer construction activity and lower finance income in wastewater and solid-waste projects. • Gross profit fell 64.55% to RMB 52.65 million; gross margin contracted to 5.0% from 12.8% a year earlier. • Segment trends: – Wastewater treatment revenue dropped 15.90% to RMB 523.02 million. – Water-supply revenue edged up 3.40% to RMB 272.91 million. – Solid-waste revenue slipped 2.81% to RMB 225.25 million. – Construction & equipment sales fell 35.87% to RMB 7.06 million. – “Others” (O&M, technical services) rose 13.57% to RMB 33.35 million.
Cost structure and expenses • Cost of sales was broadly flat at RMB 1.01 billion, but lower revenue pushed margins down. • Administrative expenses dropped 72.60% to RMB 124.47 million, reflecting reduced impairment provisions versus 2025. • Net impairment losses on financial and contract assets remained heavy at RMB 242.69 million, but eased 2.56% year on year. • Net finance costs decreased 8.43% to RMB 439.62 million; the average borrowing rate declined to 3.76% from 4.04% in 2025.
Balance-sheet pressures • Current liabilities exceeded current assets by RMB 5.34 billion, underscoring short-term liquidity pressure. • Total borrowings stood at RMB 21.49 billion, of which short-term debt was RMB 4.41 billion; cash and cash equivalents were RMB 717.21 million. • Gearing (net debt/total capital) rose to 79.80% from 78.48% at end-2025. • Capital commitments remained high at RMB 7.04 billion, mainly for concession and construction projects.
Going-concern considerations Auditor Forvis Mazars highlighted material uncertainties about the Group’s ability to continue as a going concern, citing sustained losses, negative working capital and sizeable near-term debt maturities. Management is pursuing project divestments, new strategic investors and additional bank facilities (unused capacity of RMB 2.99 billion) to ease liquidity constraints.
Operational metrics • Operating wastewater treatment capacity: 1.84 million tonnes/day across 77 plants; utilisation 77.29%; average tariff RMB 1.41/tonne. • Water-supply capacity: 1.10 million tonnes/day across 33 projects; utilisation 74.61%; average tariff RMB 2.85/tonne. • Solid-waste capacity: 2.19 million tonnes/year across 14 projects; utilisation 94.72%.
Dividend and outlook Given continuing losses, the Board declared no interim dividend. Management will prioritise cost control, project completion, receivables recovery and asset disposals while seeking to stabilise cash flow and optimise the capital structure in the second half of 2026.
No significant investments or acquisitions were recorded during the period, and there were no material changes in business operations since 31 December 2025.