Eagle Eye Warning: The standard testing accounts receivable growth rate should exceed the revenue growth rate

Sina Finance Listed Company Research Institute | Financial Report Eagle-Eye Early Warning

On March 31, Xincee Standard released its 2025 annual report. The audit opinion is a standard unqualified (standard) audit opinion.

The report shows that the company’s operating revenue for the full year of 2025 was RMB 804 million, up 10.86% year over year; net profit attributable to shareholders was RMB 196 million, up 11.49% year over year; net profit after deducting non-recurring items attributable to shareholders was RMB 187 million, up 13.2% year over year; and basic earnings per share were RMB 0.8551 per share.

Since the company’s IPO in January 2021, it has issued cash dividends 5 times, with cumulative cash dividends implemented totaling RMB 173 million. The announcement shows that the company plans to distribute a cash dividend of RMB 3 per 10 shares to all shareholders (including tax).

The Listed Company Financial Report Eagle-Eye Early Warning System conducts intelligent and quantitative analysis of Xincee Standard’s 2025 annual report from four major dimensions: performance quality, profitability, capital pressure and safety, and operating efficiency.

I. Performance Quality

During the reporting period, the company’s revenue was RMB 804 million, up 10.86% year over year; net profit was RMB 204 million, up 12.25% year over year; and net cash flow from operating activities was RMB 214 million, down 8.96% year over year.

In terms of the quality of operating assets, the following should be重点 prioritized:

• The growth rate of notes receivable is higher than the growth rate of operating revenue. During the reporting period, notes receivable increased by 73.28% from the beginning of the period; operating revenue grew by 10.86% year over year; and the growth rate of notes receivable was higher than that of operating revenue.

• The growth rate of accounts receivable is higher than the growth rate of operating revenue. During the reporting period, accounts receivable increased by 20.1% from the beginning of the period; operating revenue grew by 10.86% year over year; and the growth rate of accounts receivable was higher than that of operating revenue.

• The ratio of accounts receivable to operating revenue continues to rise. In the annual reports for the past three periods, the ratios of accounts receivable to operating revenue were 36.4%, 43.08%, and 46.67% respectively, showing continuous growth.

In terms of cash-flow quality, the following should be重点 prioritized:

• Operating revenue and net cash flow from operating activities move in opposite directions. During the reporting period, operating revenue grew by 10.86% year over year, while net cash flow from operating activities fell by 8.97% year over year; the movements in operating revenue and net cash flow from operating activities diverged.

II. Profitability

During the reporting period, the company’s gross margin was 60.16%, up 3.75% year over year; net profit margin was 25.32%, up 1.25% year over year; and return on equity (weighted) was 12.4%, down 16.95% year over year.

In terms of returns on the company’s asset base, the following should be重点 prioritized:

• Return on equity declines. During the reporting period, the weighted average return on equity was 12.4%, down 16.95% year over year.

III. Capital Pressure and Safety

During the reporting period, the company’s asset-liability ratio was 14.24%, down 62.87% year over year; the current ratio was 4.06, and the quick ratio was 3.89; total debt was RMB 57.2036 million, of which short-term debt was RMB 57.2036 million; the ratio of short-term debt to total debt was 100%.

From an overall view of the financial position, the following should be重点 prioritized:

• The current ratio keeps declining. In the annual reports over the past three periods, the current ratios were 5.81, 4.94, and 4.06 respectively, indicating weakening short-term solvency.

From the perspective of near-term capital pressure, the following should be重点 prioritized:

• The ratio of short-term to long-term debt increases significantly. During the reporting period, short-term debt / long-term debt increased substantially to 1.53.

From the perspective of capital management and control, the following should be重点 prioritized:

• The ratio of interest income to cash and cash equivalents is less than 1.5%. During the reporting period, cash and cash equivalents were RMB 190 million, short-term debt was RMB 60 million, and the company’s average ratio of interest income to cash and cash equivalents was 0.185%, below 1.5%.

• Other payables show a relatively large change. During the reporting period, other payables were RMB 40 million, and the change rate from the beginning of the period was 91.92%.

IV. Operating Efficiency

During the reporting period, the company’s accounts receivable turnover ratio was 2.34, down 9.75% year over year; inventory turnover ratio was 6.76, up 15.08% year over year; and total asset turnover ratio was 0.37, up 7.77%.

In terms of operating assets, the following should be重点 prioritized:

• The accounts receivable turnover ratio continues to decline. In the annual reports over the past three periods, the accounts receivable turnover ratios were 3.1, 2.59, and 2.34 respectively, indicating weakening accounts receivable collection capability.

• The proportion of accounts receivable to total assets continues to increase. In the annual reports over the past three periods, the ratios of accounts receivable to total assets were 11.53%, 15.25%, and 16.56% respectively, showing continuous growth.

In terms of long-term assets, the following should be重点 prioritized:

• Fixed assets change significantly. During the reporting period, fixed assets were RMB 590 million, up 62.83% from the beginning of the period.

• Unit fixed-asset income and production value declines year by year. In the annual reports over the past three periods, the ratios of operating revenue to original value of fixed assets were 2.02, 1.99, and 1.35 respectively, showing continuous decline.

Click on Xincee Standard’s Eagle-Eye Early Warning to view the latest warning details and a visualized financial report preview.

Intro to Sina Finance listed-company financial report Eagle-Eye Early Warning: the listed-company financial report Eagle-Eye Early Warning is a specialized, intelligent financial analysis system for listed-company financial reports. By pooling a large number of authoritative financial experts—including accounting firms and listed companies—the Eagle-Eye Early Warning tracks and interprets listed companies’ latest financial reports across multiple dimensions such as corporate performance growth, earnings quality, capital pressure and safety, and operating efficiency, and highlights possible financial risk points in a picture-and-text format. It provides professional, efficient, and convenient technical solutions for financial institutions, listed companies, regulatory authorities, and others to identify and issue early warnings on financial risks.

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