Guanghui Logistics Co.,Ltd reported a sharp decline in first-half profit, with revenue and net profit both falling year on year as the company pivots away from property development toward its core energy logistics business.

The company posted revenue of 1.07 billion yuan ($159.1 million)  for January-June 2026, down 24.71% year on year, while net profit attributable to shareholders slumped 95.08% to 13 million yuan, according to its interim report released on the evening of August 21. Basic earnings per share stood at 0.01 yuan.

The revenue decline was driven by two factors: the gradual exit from its real estate business, which saw segment income fall from the year-earlier period, and lower energy logistics revenue as railway operations faced softer coal market conditions and continued preferential freight rates from China State Railway Group.

Energy logistics has become the dominant revenue driver, accounting for 88.59% of total main business revenue, up 9.48 percentage points from a year earlier. The segment generated 948 million yuan in revenue and 83 million yuan in net profit attributable to shareholders.

The company's core asset is the Hongnao Railway in Hami, eastern Xinjiang Uygur autonomous region. The 435.6-km line connects the region's two major coal bases in Hami and Zhundong and serves as a key corridor for the national "Xinjiang coal outbound" strategy. Total freight volume, including transit cargo, reached 13.05 million tonnes in the first half of 2026.

In July 2026, Guanghui Logistics signed a framework agreement with China Railway Urumqi Group and the Linha backbone corridor company to integrate the Hongnao Railway into the Linha trunk line management system. The move creates a northern heavy-haul corridor with annual design capacity of 200 million tonnes, strengthening the railway's position as a hub on the northern route for Xinjiang coal outbound shipments.

Management said the integration lays the foundation for sustained freight volume growth in the years ahead. The Hongnao Railway posted a compound annual growth rate of 37% in freight volume from 2022 to 2025, and accounted for approximately 30% of total railway freight volume for Xinjiang coal outbound transport in 2024 and 2025.

Beyond the railway, the company is developing four logistics bases downstream. The Liugou comprehensive energy logistics base, serving as the first transfer hub for coal moving east from Xinjiang, has static coal storage capacity of 1 million tonnes and annual turnover capacity of about 20 million tonnes. Construction is progressing at three other bases in Mingshui, Ningdong and Guangyuan, all designated key projects in their respective provinces.

Once completed, the four bases will connect with the Hongnao Railway to form a more complete energy logistics network, enabling point-to-point transport to improve rail efficiency and increase Xinjiang coal outbound volumes, while using inventory management to smooth seasonal supply-demand gaps and expand end-user market share.