United Nations Minsheng Securities 2025 Annual Report Analysis: Revenue up 185.99% Year-over-Year, Cash Flow from Investing Activities Soars 1739.09%

Interpretation of Core Profitability Metrics

Operating Revenue

In 2025, Guolian Minsheng Securities achieved operating revenue of RMB 7.673 billion, representing a substantial year-over-year increase of 185.99% from RMB 2.683 billion in 2024. The sharp growth in revenue was mainly attributable to two factors: first, after completing the acquisition of Minsheng Securities, the business scale expanded in a step-change manner, with revenue across multiple segments—including brokerage, investment banking, and investment—rising significantly; second, in 2025, trading activity in the A-share market increased markedly. The full-year trading value of stock and fund (including stocks, funds, and Northbound market) in the Shanghai, Shenzhen, and Beijing markets rose 70.19% year over year, driving growth in the company’s revenue from brokerage and investment businesses.

Net Profit and Non-GAAP Net Profit

In 2025, the company’s net profit attributable to shareholders of the parent company was RMB 2.009 billion, up 405.49% year over year from RMB 397 million in 2024; non-GAAP net profit (excluding non-recurring gains and losses) was RMB 1.950 billion, up 412.38% year over year from RMB 381 million in 2024. The net profit growth rate far exceeded the revenue growth rate, mainly due to two factors: first, after the acquisition of Minsheng Securities, the scale effect became apparent, and the growth rate of costs such as business and management fees (121.18%) was lower than the revenue growth rate; second, investment gains performed exceptionally. Full-year investment gains were RMB 3.769 billion, up 92.77% year over year, and credit impairment losses decreased by 32.85% year over year.

Earnings Per Share

In 2025, basic earnings per share were RMB 0.36 per share, up 157.14% year over year from RMB 0.14 per share in 2024; non-GAAP basic earnings per share were RMB 0.35 per share, up 169.23% year over year from RMB 0.13 per share in 2024. The increase in earnings per share comes on the one hand from the substantial rise in net profit; on the other hand, although the company’s total share capital increased from 2.832 billion shares to 5.681 billion shares due to the acquisition, the growth in net profit far outpaced the expansion in share capital.

Analysis of Expense Structure

Overall Expense Situation

In 2025, the company’s business and management fees were RMB 5.136 billion, up 121.18% year over year from RMB 2.322 billion in 2024. The increase in expenses was mainly driven by the expansion of operational scale—such as personnel, systems, and branch institutions—after the acquisition of Minsheng Securities. The expense growth rate was lower than the revenue growth rate, indicating that the scale effect after the acquisition is gradually being released.

Breakdown of Expenses

• Selling Expenses: During the reporting period, the company’s spending related to sales increased along with the expansion of its wealth management business. The annual sales scale of financial products (excluding cash management products) reached RMB 123.714 billion. The balance of financial products at period-end was RMB 32.878 billion. The AUM for fund investment advisory (fund投顾) was RMB 14.511 billion. Accordingly, the sales team and channel investment increased.
• Management Expenses: Mainly due to the management team, branch institutions, and back-office operating costs of Minsheng Securities being brought into the company after the acquisition, along with the company’s advancement of digital transformation, upgrades to internal management systems, and compliance and risk-control investments, all of which also drove the growth in management expenses. In 2025, compliance and risk-control investments were RMB 153 million, and information technology investments were RMB 549 million.
• Financial Expenses: In 2025, net interest income was RMB 179 million, turning a loss into profit compared with RMB -99 million in 2024. This was mainly because after the acquisition the company’s financing scale expanded, but market interest rates declined. Meanwhile, the scale of funds lent increased from RMB 11.551 billion to RMB 23.811 billion, and the increase in interest income exceeded the increase in interest expense.
• R&D Expenses: The company continued to increase investment in financial technology. In 2025, information technology investments were RMB 549 million, used for the digital wealth management platform, upgrading investment research and analysis systems, intelligent risk-control tools, and other R&D efforts, promoting an intelligent transformation of the business—for example, the intelligent allocation system for fund investment advisory (fund投顾), and AI tools for customer service in brokerage business.

R&D Personnel Profile

As of the end of 2025, the company had 172 R&D personnel, accounting for 3.12% of the company’s total headcount. By education level, R&D personnel are mainly master’s and undergraduate degrees. There were 93 master’s graduate students, accounting for 54.07%; 79 undergraduates, accounting for 45.93%. There were no personnel with doctorates or education below junior college. In terms of age structure, there were 113 R&D personnel aged 30–40, accounting for 65.70%, serving as the core force of the R&D team; 23 personnel were under age 30, accounting for 13.37%; 32 personnel were aged 40–50, accounting for 18.60%; and 4 personnel were over age 50, accounting for 2.33%. Overall, the R&D team shows characteristics of being younger and more highly educated, providing talent support for the company’s financial technology R&D.

Cash Flow Analysis

Net Cash Flow from Operating Activities

In 2025, the net cash flow generated by operating activities was RMB -5.445 billion, a sharp decline of 138.74% from RMB 14.057 billion in 2024. The main reasons are: first, net increase of RMB 5.845 billion in financial assets held for trading purposes, as the company increased its proprietary investment positioning; second, net increase of RMB 6.771 billion in funds lent, with the scale of margin trading and securities lending expanding from RMB 11.551 billion to RMB 23.811 billion, occupying a large amount of capital; third, payment of RMB 9.651 billion of other cash related to operating activities, with increased outflows of operating funds brought by post-acquisition integration and business expansion.

Net Cash Flow from Investing Activities

In 2025, the net cash flow generated by investing activities was RMB 25.265 billion, surging 1739.09% year over year from RMB 1.374 billion in 2024. This was mainly because cash received from the recovery of investments was RMB 10.197 billion, while the company also received RMB 22.275 billion in other cash related to investing activities, primarily related to fund-related transactions during the process of acquiring Minsheng Securities and dividends from subsidiaries, whereas cash paid for investments was only RMB 7.626 billion. The cash flow showed a significant net inflow.

Net Cash Flow from Financing Activities

In 2025, the net cash flow generated by financing activities was RMB 8.933 billion, turning from a loss to a profit compared with RMB -2.262 billion in 2024. The main reasons are that cash received from issuing bonds was RMB 21.400 billion, while cash absorbed from investments received was RMB 1.971 billion (supporting financing). Meanwhile, cash paid to repay debts was RMB 12.778 billion, and the overall net financing inflow supported the company’s business expansion and acquisition integration funding needs.

Risks that may be Faced

Market Risk

The company’s businesses such as proprietary investments, fixed-income products, and over-the-counter derivatives face risks of market price fluctuations, including risks related to stock prices, interest rates, and exchange rates. In 2025, the bond market experienced significant adjustments. The CDB (China Bond) net price total index fell by 1.98%. If market interest rates continue to rise in 2026, the company’s bond investment and related derivatives businesses may face the risk of expanding unrealized losses. At the same time, if the A-share market experiences a large-scale pullback, investment returns from equities will be adversely affected.

Credit Risk

The company’s credit risk mainly comes from margin trading and securities lending, stock pledges, and bond investments. At the end of 2025, the outstanding balance of margin trading and securities lending was RMB 23.371 billion. If the market falls and causes collateral value provided by clients to be insufficient, default risk may arise. The outstanding balance of stock pledge business was RMB 0.901 billion. Although the average performance guarantee ratio was 397.17%, if certain underlying assets deteriorate fundamentally, credit losses may still be triggered. In bond investments, the proportion of credit bonds increased. If issuers’ credit profiles decline, credit impairment losses may occur.

Liquidity Risk

At the end of 2025, the company’s total assets were RMB 203.218 billion, up 109.05% from the beginning of the year, while total liabilities were RMB 150.346 billion, up 92.11% from the beginning of the year. If liquidity in the market tightens, the cost of issuing short-term financing instruments may rise or issuance may become difficult, potentially leading to liquidity pressure. Meanwhile, since business expansion after the acquisition is relatively fast, if funds are allocated improperly, there may be temporary funding gaps.

Integration Risk

After the company completed the acquisition of Minsheng Securities, although some progress has been made in business synergies, integration in areas such as corporate culture, management systems, and IT systems still requires time. If integration falls short of expectations, issues such as staff loss and declining business efficiency may arise, affecting the company’s overall operating performance.

Compensation for Directors, Supervisors, and Senior Executives

• Chairman: During the reporting period, Gu Wei has served as Chairman since August 2025. His pre-tax compensation received from the company was not disclosed separately. His compensation was mainly paid by the related party Guolian Group. The pre-tax compensation for former Chairman Ge Xiaobo during the reporting period was RMB 2.0347 million.
• General Manager: Ge Xiaobo, as President, had pre-tax compensation of RMB 2.0347 million during the reporting period.
• Deputy General Managers: During the reporting period, multiple deputy general managers had different roles. Among them, Wang Jinling’s pre-tax compensation was RMB 1.4477 million, Xiong Leiming’s was RMB 1.1938 million, Zheng Liang’s was RMB 1.0736 million, Wang Wei’s was RMB 1.2782 million, Yin Lei’s was RMB 1.6434 million, Li Qin’s was RMB 1.6434 million, Ren Kaifeng’s was RMB 1.2782 million, Hu Youwen’s was RMB 1.0736 million, Xu Chun’s was RMB 2.4225 million, and Yang Hai’s was RMB 1.2782 million. For former deputy general manager Yin Hongwei, compensation was RMB 0.5420 million; for Ma Qunxing, RMB 0.7779 million.
• Chief Financial Officer: Yin Lei also serves as the financial officer, and his pre-tax compensation was RMB 1.6434 million.

Overall, the compensation of the company’s executives is linked to performance. In 2025, with a significant increase in performance, executive compensation was correspondingly adjusted. At the same time, some executives’ compensation implements deferred payment—for example, 40% of the performance bonus is deferred and distributed over three years—strengthening long-term incentives and constraints.

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