Paper & Forest Products

ST Chenming announced after market close on September 29 that its controlling shareholder, Chenming Holdings Limited, issued a debt waiver letter, waiving its 207 million yuan claim against the company to support the company in easing operating pressure and focusing on its core pulp and paper business. On the same day, the company issued another announcement stating that Shouguang Zhichen Asset Operation Company Limited, a wholly state-owned enterprise under the Shouguang Municipal Finance Bureau, issued debt waiver letters to its controlling subsidiaries Shouguang Meilun Paper Company Limited and Shandong Chenming Paper Products Company Limited, waiving 487 million yuan of debt owed by Shouguang Meilun and 350 million yuan of debt owed by Shandong Chenming Paper Products. The controlling shareholder and local state-owned assets together waived more than 1 billion yuan in debt. The waived amounts will be recorded in capital reserves for the current year, and the company said this will effectively reduce debt pressure and optimize its asset-liability structure. In terms of performance, in the first half of 2026 the company achieved operating revenue of 6.865 billion yuan, up 225.90 percent year on year, while the net loss attributable to shareholders of the listed company was 786 million yuan, a significant narrowing of 79.61 percent from the loss of 3.858 billion yuan in the same period last year. As of June 30, 2026, the company's asset-liability ratio was 96.09 percent, and total bank borrowings stood at 28.92 billion yuan.

Yongan Forestry announced on the evening of September 23 that the company has filed a lawsuit with the Yongan Municipal People's Court in Fujian Province against four former directors and executives, Su Jiaxu, Chen Songbai, Chen Zhenzong, and Wu Jingxian, over a dispute concerning liability for damages to the company's interests. The amount involved is 32.7645 million yuan. The company has received the court's notice of case acceptance, and the case has not yet been heard. This recovery action stems from a securities misrepresentation case from years ago. On August 18, 2021, the Fujian Bureau of the China Securities Regulatory Commission determined that the company's 2016 and 2017 annual reports contained false financial records, issued a warning to Yongan Forestry, and imposed a fine of 500,000 yuan. All four individuals were identified as directly responsible supervisors and received warnings and fines. On April 18, 2024, the Fuzhou Intermediate People's Court ruled in a securities misrepresentation liability dispute involving Zhang Qiang and 16 others, ordering the company to pay compensation of 31.7255 million yuan to sixteen plaintiffs, with the four defendants bearing joint and several liability. The judgment took effect after the Fujian Provincial High People's Court upheld it on second instance on June 25, 2025, and the Supreme People's Court rejected a retrial application on May 29, 2026. Because the four individuals failed to fulfill their obligations under the effective judgment, Yongan Forestry is seeking a court order requiring the four defendants to jointly compensate a total of 32.764504 million yuan, comprising a fine of 500,000 yuan, compensation of 31.72551364 million yuan, first-instance litigation costs of 269,495.18 yuan, and second-instance litigation costs of 269,495.18 yuan, and to jointly bear the case acceptance fee. The company stated that the case has not yet been heard, and its impact on current and future profits remains uncertain.

Clearwater Paper has completed a refinancing that replaces its term revolver, its existing asset-based lending revolving facility and its senior notes maturing in 2028 with a new term loan and a new revolving credit line. Under the package, the company secured a $200m revolving credit facility, with $15m drawn at the closing date, and put in place a $275m term loan that was fully funded when the transaction closed. The revolving facility carries an uncommitted option to increase capacity by a further $100m, subject to lender participation, submission of the company's 2027 year-end financial statements and other standard conditions. Proceeds were used to repay and terminate the existing ABL facility and to cover the redemption price for the company's outstanding $275m senior notes due in 2028, which are to be redeemed in full. The new agreement, signed this month with AgWest Farm Credit acting as administrative agent alongside a lender syndicate, runs for five years and matures in September 2031, extending Clearwater Paper's long-term debt maturity timetable. President and CEO Arsen Kitch said the refinancing extends the company's debt maturities and provides greater certainty as it executes its long-term strategy.

West Fraser Timber Co. Ltd. has entered into a new $500 million three-year term loan, with partial proceeds used to retire its existing $300 million term loan due in 2028. The new term loan matures in September 2029, while the company's $1 billion syndicated credit facility remains outstanding on existing terms with roughly four years left to its May 2030 maturity. Pro forma for the refinancing at the end of the second quarter, West Fraser would have had a cash balance of $219 million, no draw on its syndicated credit facility, available liquidity of over $1.2 billion, and a net debt to capital ratio of 5.4%. President and CEO Sean McLaren said the new term loan strengthens near-term liquidity and provides additional financial flexibility. The company also declared a quarterly dividend of US$0.32 per share on its Common shares and Class B Common shares, payable October 19, 2026 to shareholders of record on September 29, 2026.

Xianhe Co., Ltd. released its 2026 interim report, with total operating revenue of 6.304 billion yuan, net profit attributable to the parent company of 540 million yuan, and net cash inflow from operating activities of 417 million yuan. The company's latest asset-liability ratio is 65.37 percent, up 0.20 percentage points from the previous quarter; gross margin is 15.11 percent, return on equity is 5.94 percent, and diluted earnings per share is 0.76 yuan. Total asset turnover is 0.25 times and inventory turnover is 1.28 times, both ranking 17th among peers. The number of shareholders is 17,700, and the top ten shareholders hold 81.52 percent of the total share capital.

ST Chenming released its 2026 interim report. First-half operating revenue was 6.87 billion yuan, up 225.9% year on year. Net loss attributable to the parent was 786 million yuan, narrowing from a loss of 3.86 billion yuan in the same period last year. In the second quarter, operating revenue was 3.88 billion yuan, up 196.6% year on year, and net loss attributable to the parent was 274 million yuan, down from a loss of 2.41 billion yuan a year earlier. As of the end of the second quarter, total assets were 50.966 billion yuan, up 0.7% from the end of the previous year, while net assets attributable to the parent were 156 million yuan, down 82.8% from the end of the previous year. The company said that during the reporting period its production bases fully resumed operations, machine-made paper sales volume rose sharply year on year, shutdown losses fell sharply year on year, and the divestment of assets related to the financial leasing business significantly reduced credit impairment losses and asset impairment losses.

Chenming Paper disclosed its first-half 2026 report on the evening of August 28. The company pushed ahead with resuming full production across all manufacturing bases, achieving operating revenue of 6.865 billion yuan and a net loss attributable to the parent of 786 million yuan, a significant narrowing of over 70% compared with the same period last year. Net operating cash flow was 322 million yuan, maintaining a positive inflow. With all five major production bases back in full operation, machine-made paper output and sales more than doubled year on year, the advantage of self-sufficiency in wood pulp was gradually released, and the earnings resilience of the main business strengthened. The results of debt structure optimization became evident, with financial expenses of 561 million yuan, down 30.31% year on year. The financial leasing business was fully divested, sharpening the focus on the core pulp and paper business. Market analysts believe that the supply-demand landscape in the paper industry is improving at the margin, and there is room for the company's earnings recovery to open up further, but risks from industry cyclical fluctuations and intensifying competition remain.

Mercer International has secured C$20 million, approximately US$14 million, in financial support from the Canadian government for its Mercer Peace River Pulp subsidiary. The funding includes C$1 million non-repayable and C$19 million repayable, with repayment beginning in 2031. The capital will support productivity improvements and modernization at the Peace River mill in northern Alberta, including preparing the facility for expanded bio-energy production and carbon capture and storage. This builds on the mill's existing CO₂ capture demonstration project. Mercer International shares surged 53% in post-market trading.

Dashengda disclosed its 2026 semi-annual report on August 26. In the first half, it achieved total operating revenue of 1.084 billion yuan, up 5.69% year on year. Net profit attributable to the parent company was 64.51 million yuan, up 9.07% year on year. Net profit after deducting non-recurring items was 28.221 million yuan, down 26.19% year on year. Net cash flow from operating activities was 95.8402 million yuan, down 35.90% year on year. During the reporting period, the company's basic earnings per share were 0.12 yuan, and the weighted average return on net assets was 1.97%.

Rongsheng Environmental Protection released its 2026 interim report, with total operating revenue of 1.181 billion yuan and net profit attributable to the parent company of 190 million yuan. Net cash outflow from operating activities was 57.5165 million yuan, the asset-liability ratio was 48.15 percent, gross margin was 13.07 percent, return on equity was 7.74 percent, and diluted earnings per share was 0.67 yuan. The company had 14,500 shareholders, and the top ten shareholders held 55.27 percent of total share capital.

Hengfeng Paper has released its 2026 interim report. Total operating revenue was 1.386 billion yuan, an increase of 32.796 million yuan compared with the same period last year, marking a fifth consecutive year of growth and a year-on-year rise of 2.42%. Net profit attributable to the parent company was 112 million yuan, up 17.04 million yuan from a year earlier, achieving a fourth straight year of growth and a year-on-year increase of 17.95%. Net cash inflow from operating activities was 331 million yuan, up 183 million yuan from the prior year, a year-on-year increase of 124.39%. The company's latest asset-liability ratio was 26.74%, gross margin was 19.79%, return on equity was 3.64%, and diluted earnings per share was 0.35 yuan.

Sun Paper released its 2026 interim report. Total operating revenue was 20.862 billion yuan, net profit attributable to the parent company was 1.951 billion yuan, and net cash inflow from operating activities was 3.366 billion yuan. The latest asset-liability ratio was 47.85 percent, ranking 12th among peer companies that have disclosed data, up 0.18 percentage points from the previous quarter and up 1.84 percentage points from the same period last year. Gross margin was 15.66 percent, down 0.83 percentage points from a year earlier. Return on equity was 6.19 percent, and diluted earnings per share were 0.70 yuan. Total asset turnover was flat year on year. Inventory turnover was 3.08 times, down 0.23 times from a year earlier. The number of shareholders was 44,900, and the top ten shareholders held 53.07 percent of total share capital.