Mingxin Automotive Leather Co. Ltd.

Mingxin Xuteng's controlled subsidiary, Liaoning Fuxin New Materials Co., Ltd., has been forced to halt production because the discharge limits of the industrial park's wastewater treatment plant far exceed its treatment capacity. Starting June 27, 2026, the park's wastewater treatment plant further tightened discharge requirements, which far surpassed the maximum capability of Liaoning Fuxin's existing wastewater treatment system. After multiple rounds of unsuccessful negotiations, the company made the decision to stop production on July 27. Liaoning Fuxin achieved operating revenue of 258 million yuan and net profit of 3.16 million yuan in 2025, but had already incurred a loss of 4.95 million yuan in the first quarter of 2026. Mingxin Xuteng stated that it will ensure delivery through inventory and order transfers, and the production halt itself will not have a significant impact on the group's normal operations, but it expects to set aside an asset impairment provision of about 10 million yuan. The company previously forecast a net loss attributable to the parent company of 35 million to 52 million yuan for the first half of 2026, mainly due to factors such as industry price wars, production capacity ramp-up, and insufficient contribution from new products.

Mingxin Xuteng disclosed its earnings forecast, expecting a net loss attributable to the parent company of 35 million to 52 million yuan for the first half of 2026, compared with a loss of 29.3909 million yuan in the same period last year. The net loss after deducting non-recurring items is expected to be 40 million to 60 million yuan, compared with a loss of 40.971 million yuan a year earlier. The company said the main reasons for the loss are the ongoing escalation of the price war in the automotive industry, with cost-cutting pressure from vehicle manufacturers being passed on to the upstream supply chain, resulting in low product gross margins. Fixed costs remain high as previously planned production capacity is gradually converted to fixed assets, and capacity is still in the ramp-up phase, so economies of scale have not been fully realized. New products have been on the market for only a short time and have yet to contribute effectively to profits.

Mingxin Xuteng announced that shareholder Zhejiang Mingxin Asset Management Co., Ltd. has reduced its stake by 1.48 million shares through block trades, accounting for 0.91% of the company's total share capital, and Mingxin Asset has decided to terminate this share reduction plan early. In the first quarter of 2026, Mingxin Xuteng achieved revenue of 302 million yuan and a net loss attributable to the parent company of 15.42 million yuan.