CF Energy Announces Financial Results For the Three-month and Six-month periods ended June 30, 2025

Executive Summary

• CF Energy Corp. announced its unaudited interim consolidated financial results for the three-month and six-month periods ended June 30, 2025.
• For Q2 2025, the company reported a net profit of RMB1.0 million (CAD0.2 million), a significant turnaround from a net loss of RMB8.4 million in Q2 2024, driven by improved gross margins despite a slight decrease in revenue.
• For the first half of 2025 (1H 2025), revenue decreased by 18% year-over-year due to non-recurring bulk sales in the prior period, but gross profit and net profit both increased, with net profit rising to RMB2.6 million (CAD0.5 million).

Key Details

• Q2 2025 Financials (Three Months Ended June 30, 2025):

  • Revenue: RMB98.4 million (CAD19.1 million), a decrease of 2% from RMB100.4 million in Q2 2024. The decrease was attributed to bulk sales of pipeline gas to a power plant supplier in Q2 2024 that were not repeated in Q2 2025; excluding these, revenue remained stable.
  • Gross Profit: RMB25.6 million (CAD5.0 million), an increase of 64% from RMB15.6 million in Q2 2024.
  • Gross Profit Margin: Increased to 26.0% from 15.5% in Q2 2024. The improvement was driven by higher unit selling prices for residential pipeline installation connections and reduced negative margins in the Integrated Smart Energy segment.
  • Net Profit: RMB1.0 million (CAD0.2 million), compared to a net loss of RMB8.4 million (CAD1.6 million) in Q2 2024.
  • EBITDA: RMB21.1 million (CAD4.1 million), an increase of 130% from RMB9.1 million in Q2 2024.
  • EPS: Basic EPS from continuing operations was RMB0.04 (CAD0.01), compared to a loss of RMB0.09 (CAD0.02) in Q2 2024.

• 1H 2025 Financials (Six Months Ended June 30, 2025):

  • Revenue: RMB203.5 million (CAD39.5 million), a decrease of 18% from RMB249.4 million in 1H 2024. The decline was due to bulk sales to two power plants in 1H 2024 that were not repeated in 1H 2025.
  • Gross Profit: RMB50.1 million (CAD9.7 million), an increase of 4% from RMB48.3 million in 1H 2024.
  • Gross Profit Margin: Increased to 24.6% from 19.4% in 1H 2024. On a comparable basis (excluding bulk sales), the margin was similar to the prior year's 24.7%.
  • Net Profit: RMB2.6 million (CAD0.5 million), an increase of 70% from RMB1.5 million in 1H 2024.
  • Adjusted Net Profit (Non-GAAP): RMB2.4 million (CAD0.5 million), excluding RMB0.2 million in government financial assistance received in 1H 2025.
  • EBITDA: RMB43.0 million (CAD8.4 million), an increase of 11% from RMB38.7 million in 1H 2024.
  • Adjusted EBITDA (Non-GAAP): RMB42.8 million (CAD8.4 million), excluding government financial assistance.
  • EPS: Basic EPS from continuing operations was RMB0.09 (CAD0.02), compared to RMB0.08 (CAD0.02) in 1H 2024.

• Operational Updates & Strategy:

  • The company is transitioning from a traditional natural gas distributor to a comprehensive clean energy service solutions provider.
  • Distributed Smart Energy Ecosystem: CF Energy is developing integrated smart energy systems, including the Haitang Bay and Meishan projects, utilizing ice storage and advanced grid technologies.
  • Battery Swapping: The company operates a battery swap station network in Sanya for EV taxis, incorporating solar panels and electrochemical energy storage to create a distributed energy system.
  • IoT and EMS: Partnerships are being developed to create an Energy Management System (EMS) connecting distributed systems via IoT devices and machine learning to optimize energy production, storage, and distribution.
  • Virtual Power Plant Vision: The company aims to integrate centralized cooling, battery swap stations, and storage to operate as a virtual power plant, providing grid services like peak shaving and load balancing, potentially utilizing Vehicle-to-Grid (V2G) technology.
  • Natural Gas Integration: The traditional natural gas business will support the renewable ecosystem through Combined Heat and Power (CHP) systems, providing baseload power and thermal energy to balance intermittent renewable supply.