Zhejiang Sanhua Intelligent Controls Co., Ltd. (SANHUA) released its 2026 interim report for the six months ended 30 June 2026.

Financial Highlights • Revenue reached RMB 16.90 billion, rising 3.9% year on year. • Net profit attributable to shareholders slipped 3.1% to RMB 2.04 billion. • Gross profit margin held at 27.9%, versus 27.8% a year earlier. • Operating cash inflow doubled to RMB 2.42 billion; free cash flow turned positive despite heavier capex. • Cash and cash equivalents closed at RMB 11.91 billion; interest-bearing debt totaled RMB 3.72 billion, keeping the liability-to-asset ratio at 36.2%.

Segment Performance 1. Refrigeration & Air-Conditioning Components – Sales: RMB 10.44 billion, up 0.5% YoY, contributing 61.8% of group revenue. – Gross profit: RMB 2.95 billion; segment margin 28.3%. – Management cited muted residential AC demand in China and softer overseas orders, partly offset by structural growth in heat-pump and data-center liquid-cooling applications.

2. Automotive Components – Sales: RMB 6.46 billion, up 9.9% YoY, lifting revenue share to 38.2%. – Gross profit: RMB 1.76 billion; segment margin 27.2%. – Growth driven by higher penetration of thermal-management parts in new-energy and export vehicles; commercial-vehicle and energy-storage opportunities under exploration.

Capital Expenditure & R&D • First-half capex: RMB 1.00 billion, mainly on manufacturing upgrades in Hangzhou, Shaoxing and overseas bases. • R&D spend increased 8.3% to RMB 763.30 million, representing 4.5% of revenue; six global R&D centers and 4,877 patents (2,664 invention patents) as at period-end.

Balance Sheet & Liquidity • Total assets: RMB 51.46 billion; net assets: RMB 32.82 billion. • Net current assets improved to RMB 18.98 billion; current ratio at 2.1 times. • Net cash used in investing was RMB 2.26 billion, chiefly due to term-deposit placements and factory construction. • Financing cash outflow of RMB 0.58 billion reflected dividend payments of RMB 0.50 billion and lease/interest payments.

Dividend An interim cash dividend of RMB 1.20 per 10 shares (tax inclusive) was approved on 15 September 2026, totaling approximately RMB 503.30 million and equating to a 24.6% payout of first-half earnings. Payment to H-shareholders is scheduled for 29 October 2026, converted at RMB 1 = HK$1.157348.

Strategic Outlook for 2H 2026 SANHUA targets: • Deepening customer ties and cost optimisation in core RAC components. • Expanding NEV thermal-management share, while entering commercial-vehicle, energy-storage and autonomous-driving niches. • Accelerating data-center liquid-cooling deployments across primary side, CDU and server-rack applications. • Leveraging digitalisation and AI to raise global manufacturing efficiency.

Post-Period Event Between July and mid-September 2026, SANHUA repurchased 5.50 million A-shares for RMB 197.80 million, representing 0.1% of total issued capital.

Capital Commitments Outstanding authorised but uncontracted capex stood at RMB 4.96 billion; contracted but unprovided commitments totaled RMB 908.93 million, mainly for China and overseas capacity expansions.

No material acquisitions, disposals or contingent liabilities were reported after 30 June 2026.