Shengxing Co., Ltd. 2025 Annual Report Interpretation: Deducting Non-GAAP Net Profit Declined 31.49% Cash Flow from Financing Activities Net Amount Reduced Loss by 40.11%

Log in to Sina Finance App and search for [Disclosure of Information] to see more evaluation levels

Core Profitability Indicators Decline, Profit Quality Under Pressure

Revenue Slightly Up, Main Business Growth Weak

In 2025, Shengxing Co., Ltd. achieved operating revenue of 7.174 billion yuan, a year-on-year increase of only 0.61%, with growth further slowing compared to 2024. From the revenue structure, revenue from the metal packaging industry was 6.712 billion yuan, a slight decrease of 0.38% year-on-year, accounting for 93.56% of total revenue, remaining the company’s main income source; other business income was 456 million yuan, up 18.04% year-on-year, but only 6.36% of total, still unable to offset the weak growth of the core business.

Net Profit and Non-Recurring Profit Both Decline, Profit Quality Deteriorates

Net profit attributable to shareholders of the listed company was 307 million yuan, a sharp decrease of 27.44% year-on-year; net profit after deducting non-recurring gains and losses was 279 million yuan, down 31.49%, a larger decline than net profit, indicating pressure on core profitability. Among non-recurring gains and losses, government grants amounted to 19.518 million yuan, an increase of 11.6 million yuan from 2024, somewhat buffering the impact of declining main business profits, but the decline in core profitability remains the main reason for profit shrinkage.

Earnings Per Share Decline Simultaneously, Shareholder Returns Shrink

Basic earnings per share were 0.31 yuan/share, down 27.91% year-on-year; non-recurring EPS was 0.29 yuan/share, down 31.49%, consistent with the decline in net profit and non-recurring profit, with shareholder returns per share shrinking accordingly.

Cost Structure Optimization Fails to Offset Cost Pressures, R&D Investment Slightly Shrinks

Total Expenses Slightly Up, Structural Optimization Achieved

In 2025, total expenses (sales + management + financial + R&D) amounted to 400.138 million yuan, a slight increase of 0.23% year-on-year. Expense growth was lower than revenue growth, indicating initial results of expense control, but still insufficient to offset the decline in main business profits.

Sales Expenses Reduced, Management Expenses Stable

Sales expenses were 32.6338 million yuan, down 9.91% year-on-year, mainly due to optimization of sales channels and reduction of unnecessary sales costs; management expenses were 289.2246 million yuan, up only 1.75%, much lower than previous years, showing effective expense control at the management level.

Financial Expenses Rise, Financial Cost Pressure Emerges

Financial expenses were 35.4036 million yuan, up 11.00% year-on-year, mainly due to increased interest rates on some borrowings and exchange losses caused by currency fluctuations, indicating rising financial costs.

R&D Expenses Slightly Shrink, R&D Investment Marginally Weaker

R&D expenses were 43.2768 million yuan, down 6.60%, indicating a slight reduction in R&D investment intensity. The company mainly focuses on process optimization and cost reduction of existing products, such as SK330 can weight reduction technology innovation project, SD500ml can stretching process innovation project, aiming to lower production costs through technological improvements, but investment in new product R&D is somewhat insufficient.

Expansion of R&D Staff and Continuous Talent Strengthening

In 2025, the company’s R&D personnel numbered 373, a significant increase of 21.10% year-on-year. R&D staff accounted for 9.80% of total employees, up from 8.37%. The company continues to increase R&D talent reserves. From educational background, 105 R&D personnel hold bachelor’s degrees or above, a 43.84% increase, significantly improving the team’s educational level and laying a talent foundation for future technological innovation.

Net Cash Flow Turns Positive, Marginal Relief in Financing Pressure

Steady Increase in Operating Cash Flow, Stable Cash Generation Ability

Net cash flow from operating activities was 560.072 million yuan, up 6.85% year-on-year, mainly due to improved receivables management, with cash received from sales increasing by 3.52% to 7.368 billion yuan; at the same time, strict control of procurement expenses kept cash paid for purchases below revenue growth, maintaining stable cash generation capacity.

Narrowed Net Outflow of Investing Cash Flow, Slower Capital Expenditure

Net cash flow from investing activities was -270.316 million yuan, a reduction of 18.9 million yuan from the previous year, mainly due to slowed capital expenditure, with cash paid for fixed assets, intangible assets, and other long-term assets decreasing by 24.37 million yuan to 290 million yuan; asset disposals recovered 3.8 million yuan, reducing the net outflow.

Significant Reduction in Financing Cash Outflows, Slight Relief in Debt Repayment Pressure

Net cash flow from financing activities was -289.231 million yuan, a decrease of 40.11% year-on-year, mainly due to optimized debt structure, with debt repayment cash decreasing by 3.187 billion yuan to 1.241 billion yuan; meanwhile, cash received from new borrowings remained stable, easing financing pressure.

Multiple Risks Remain, Operational Challenges Persist

Raw Material Price Fluctuation Risk

Raw materials such as tinplate and aluminum account for over 85% of production costs. Fluctuations in raw material prices significantly impact costs. Although prices declined somewhat in 2025, they remain at historically high levels. A sharp increase in raw material prices in the future would further increase cost pressures.

Intensified Market Competition Risk

The metal packaging industry has a dispersed competitive landscape. Leading companies still have room to expand market share, but slow clearance of small and medium capacities results in fierce competition. Downstream food and beverage demand remains weak, and customer bargaining power increases, putting downward pressure on product prices.

Exchange Rate Fluctuation Risk

The company’s overseas revenue continued to grow, reaching 1.092 billion yuan in 2025, up 14.42% year-on-year, accounting for 15.22% of total revenue. Fluctuations in the RMB exchange rate will directly affect overseas profitability. A significant appreciation of the RMB could erode overseas profits.

Executive Compensation Linked to Company Performance, Incentive Mechanism Needs Optimization

Chairman and President Compensation Remain Stable

Chairman and President Lin Yongbao received a pre-tax total of 864,200 yuan in 2025, roughly unchanged from 2024. Despite declining performance, core executives’ compensation was not adjusted accordingly, indicating weak linkage between pay and performance.

Vice Presidents and CFO Compensation Increased

Vice President Lin Bin’s pre-tax compensation was 1.0009 million yuan, up 12.30%; CFO Wang Wei’s was 1.0833 million yuan, up 15.67%, mainly due to annual performance-based adjustments, contrasting with the company’s performance decline.

Vice President and Board Secretary Liu Jiayi Maintains High Compensation

Vice President and Board Secretary Liu Jiayi’s pre-tax pay was 914,100 yuan, roughly stable from 2024, reflecting the company’s emphasis on capital operations and information disclosure.

Click to view the original announcement>>

Disclaimer: Market risks exist; investment should be cautious. This article is automatically generated by an AI model based on third-party data and does not represent Sina Finance’s views. All information herein is for reference only and does not constitute personal investment advice. Please refer to official announcements for accuracy. For questions, contact biz@staff.sina.com.cn.