Nine Dragons Paper (02689.HK) recently announced its results for fiscal year 2026. During the reporting period, sales volume increased by approximately 14% year on year to approximately 24.5 million tonnes, marking a new historical high for the fourth consecutive year. Sales revenue increased by 18.6% year on year to approximately RMB75 billion, while net profit surged 83.8% year on year to approximately RMB4.05 billion.
The Company said the significant improvement in profitability was mainly attributable to the strengthened cost advantages arising from its vertically integrated raw material supply chain, as well as higher average selling prices driven by an increased proportion of high-end products.
Nine Dragons Paper said its integrated forestry, pulp and paper strategy represents a strategic long-term investment designed to align with the development trends of the industry. The strategy not only provides stable quality assurance for the research, development and production of high-end products, but also strengthens the Company's resilience and profit flexibility amid industry fluctuations.
During the reporting period, the Company's expansion projects in Beihai, Guangxi, and Jingzhou, Hubei province, came on stream successfully. The projects comprise 1.9 million tonnes per year of designed capacity for high-end paper production and 0.7 million tonnes per year of designed capacity for wood pulp production, further strengthening the Company's raw material advantages and diversifying its product portfolio. As of June 30, 2026, the Company's total designed annual wood pulp production capacity was approximately 5.4 million tonnes, while its total designed annual paper production capacity was approximately 24.8 million tonnes.
The Company said it is investing in projects in Chongqing, Tianjin, Jingzhou, Beihai, Dongguan and Taicang, with approximately 3.8 million tonnes per year of designed fibre production capacity and approximately 3.2 million tonnes per year of designed paper production capacity. Upon completion, the Company's total designed annual wood pulp production capacity will exceed 8.5 million tonnes, while its total designed annual paper production capacity will reach approximately 26.1 million tonnes. The Company's wood pulp capacity footprint will then achieve comprehensive coverage across key regions in China. This will support product upgrades and create a market-oriented, more efficient supply chain network, laying a solid foundation for the sustained release of profitability.
Nine Dragons Paper is the world's largest paper manufacturer by production capacity and a leading integrated pulp and paper enterprise. Looking ahead, the Company said that a series of policies aimed at expanding domestic demand, boosting consumption and stabilising foreign trade, together with the environmental benefits arising from the substitution of paper for plastic and the expansion of China's national carbon emissions trading market, are expected to further improve supply-demand conditions in the paper industry. The Company's integrated pulp and paper operations and diversified product portfolio are positioned to benefit from these favourable development conditions.
