Shantui Co., Ltd. 2025 Annual Report Analysis: Net Profit Excluding Non-Recurring Items Up 20.28%, Financial Expenses Increase by 268.32%

Financial Report Analysis

Operating Revenue

In 2025, the company achieved an operating revenue of 14.62 billion yuan, a year-on-year increase of 2.82%. From the revenue composition, main business income was 13.618 billion yuan, up 5.49%. Industrial product sales contributed 13.339 billion yuan, a 7.75% increase, with construction machinery main products revenue reaching 10.95 billion yuan, a significant rise of 12.15%, becoming the core driver of revenue growth; commercial product sales, however, dropped sharply by 47.34% to 279 million yuan. Regionally, domestic revenue was 4.876 billion yuan, down 11.29%, while overseas revenue was 8.741 billion yuan, up 17.94%, making the overseas market an important support for revenue growth. In terms of sales channels, direct sales amounted to 6.07 billion yuan, up 24.09%, while distributor sales were 7.548 billion yuan, down 5.85%. The proportion of direct sales increased significantly.

Net Profit

The company’s net profit attributable to shareholders of the listed company in 2025 was 1.211 billion yuan, a 9.86% increase. The profit growth was mainly due to steady growth in main business, supplemented by non-recurring gains and losses of 24.1568 million yuan, which contributed to net profit growth.

Net Profit Excluding Non-Recurring Items

Net profit attributable to shareholders after deducting non-recurring gains and losses was 1.187 billion yuan, a substantial increase of 20.28%, significantly higher than the overall net profit growth, indicating the company’s profitability from core operations has been effectively enhanced and profit quality further improved.

Basic Earnings Per Share

Basic earnings per share were 0.8094 yuan, up 10.18%, consistent with the net profit growth trend, reflecting increased net profit generated per share.

Diluted Earnings Per Share (excluding non-recurring items)

The specific figure for diluted EPS excluding non-recurring items was not disclosed separately, but given the high growth rate of net profit after deducting non-recurring items, its year-on-year increase is expected to be considerable, indicating a significant improvement in earnings per share after excluding non-recurring factors.

Expenses

In 2025, the company’s total operating expenses were 1.694 billion yuan, with various expense categories showing different trends.

Selling Expenses

Selling expenses were 621 million yuan, up 5.01%, mainly due to an increase in overseas sales personnel leading to higher salaries, reflecting the company’s increased investment in expanding overseas markets.

Management Expenses

Management expenses were 424 million yuan, down 4.12%, mainly due to salary adjustments for internal retirees and strengthened cost control measures, demonstrating improved internal management efficiency and cost management.

Financial Expenses

Financial expenses were 74.1 million yuan, a sharp increase of 268.32%, primarily due to exchange losses caused by currency fluctuations, highlighting the impact of exchange rate risks on financial costs.

R&D Expenses

R&D expenses totaled 575 million yuan, up 6.09%, mainly due to an increase in R&D personnel leading to higher salaries. The company continues to increase R&D investment, focusing on large-scale mining, high-end small-scale equipment, and new energy sectors. Several mining and new energy products have been successfully launched, laying a foundation for technological upgrades and product structure optimization.

R&D Personnel

In 2025, R&D staff numbered 2,118, a 5.85% increase. The proportion of R&D personnel rose to 29.23%, up 0.48 percentage points year-on-year. The share of bachelor’s degree or higher R&D staff increased, with R&D personnel aged 30-40 growing by 17.57%, further optimizing the team structure and supporting technological innovation.

Cash Flow

The company’s net increase in cash and cash equivalents in 2025 was -170 million yuan, a 63.77% increase compared to the previous year, but still negative, indicating a reduction in overall cash reserves.

Net Cash Flows from Operating Activities

Net cash flow from operating activities was 781 million yuan, a significant increase of 51.64%, mainly due to increased sales receipts, reflecting improved cash collection ability from core business and effective profit quality.

Net Cash Flows from Investing Activities

Net cash flow from investing activities was -310 million yuan, down 349.18%, mainly due to increased capital injection into Shandong Heavy Industry Financial Company, indicating ongoing investment in strategic layout.

Net Cash Flows from Financing Activities

Net cash flow from financing activities was -660 million yuan, up 40.96%, mainly because last year’s payment of 1.841 billion yuan for the acquisition of Shandong Heavy Industry Construction Machinery Co., Ltd. was not repeated this year, easing cash outflow pressure.

Potential Risks

The main risks faced by the company include: 1) macro policy adjustment risk, as the construction machinery industry is highly related to fixed asset investment, and policy changes may impact market demand; 2) exchange rate risk, with increased overseas business proportion, fluctuations could affect financial costs and profits; 3) raw material price increase risk, as prices of steel, copper, aluminum, and lithium carbonate may fluctuate, raising costs; 4) accounts receivable and inventory impairment risk, due to weak downstream customer risk resistance, increased credit sales from industry competition, and market supply-demand changes potentially leading to impairments; 5) industry competition risk, as industry concentration increases, leading to intensified competition among leading enterprises, requiring continuous product competitiveness enhancement.

Chairman’s Pre-Tax Compensation During the Reporting Period

Chairman Li Shizhen received a total pre-tax remuneration of 1.3209 million yuan, aligned with the company’s performance growth, reflecting performance-linked compensation for core management.

General Manager’s Pre-Tax Compensation During the Reporting Period

General Manager Zhang Min received a total pre-tax remuneration of 1.2829 million yuan, consistent with operational results, indicating the importance of his role in company management.

Deputy General Managers’ Pre-Tax Compensation During the Reporting Period

Deputy General Managers Huang Yajun, Han Baohui, and Zhu Laisuo received pre-tax remunerations of 960,200 yuan, 1.1152 million yuan, and 1.0695 million yuan, respectively, with compensation levels varying according to their responsibilities and contributions, reflecting a performance-based remuneration system.

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