Zhongfu Shenying 2025 Annual Report: Revenue Increased by 40.87%, Turned Losses into Profits, Management Expenses Dropped by 37.89%

Core Revenue Indicators: Turned Losses into Profits, Significant Revenue Growth

In 2025, Zhongfu Shenying achieved operating revenue of 2.194 billion yuan, a 40.87% increase from 1.557 billion yuan in 2024, mainly driven by active expansion into downstream application fields boosting sales. Net profit attributable to shareholders of the listed company was 96 million yuan, turning from a loss of 124 million yuan in 2024; net profit excluding non-recurring gains and losses was 69 million yuan, also turning positive (2024: -185 million yuan).

Basic earnings per share were 0.11 yuan/share, compared to -0.14 yuan/share in 2024; non-recurring EPS was 0.08 yuan/share, compared to -0.21 yuan/share in 2024.

Remarkable Cost Control: Significant Reduction in Management and Financial Expenses

In 2025, total operating expenses were 3.288 billion yuan, down 13.18% from 3.787 billion yuan in 2024. Specifically:

• Sales Expenses: 32.78 million yuan, up 8.39% from 30.24 million yuan in 2024, mainly due to strengthened sales team and increased market development.
• Management Expenses: 1.09 billion yuan, down 37.89% from 1.77 billion yuan in 2024, mainly due to optimized management structure and tighter expense control.
• Financial Expenses: 22.35 million yuan, down 36.43% from 35.16 million yuan in 2024, mainly due to reduced interest expenses.
• R&D Expenses: 1.64 billion yuan, down 7.19% from 1.77 billion yuan in 2024, mainly due to completion of some R&D projects.

R&D Staff and Investment: Stable Workforce, Decreased Investment Ratio

In 2025, the company had 328 R&D personnel, an 8.25% increase from 303 in 2024. R&D staff accounted for 10.04% of total employees, slightly down from 10.25% in 2024. Total R&D personnel compensation was 51.79 million yuan, slightly down from 52.00 million yuan in 2024. Average salary per R&D employee was 157,900 yuan, an 8.0% decrease from 171,600 yuan in 2024.

Total R&D investment was 164 million yuan, a 13.78% decrease from 190 million yuan in 2024. R&D expenditure accounted for 7.48% of operating revenue, down from 12.22% in 2024, a decrease of 4.74 percentage points.

Cash Flow Structure: Decline in Operating Cash Flow, Surge in Financing Cash Flow

In 2025, net cash flow from operating activities was 375 million yuan, down 30.60% from 540 million yuan in 2024, mainly due to increased cash payments for raw materials and taxes resulting from higher production volume and improved profitability.

Net cash flow from investing activities was -360 million yuan, significantly narrower than -1.372 billion yuan in 2024, mainly due to maturity and redemption of structured deposits.

Net cash flow from financing activities was 1.124 billion yuan, turning positive from -246 million yuan in 2024, mainly due to issuance of special bonds for project construction.

Risk Warnings: Multiple Dimensions of Risks Still Need Attention

Core Competitiveness Risks

The carbon fiber industry evolves rapidly; the company needs to accelerate research in basic carbon fiber technology, fiber materials, and microstructure to balance foundational research, theoretical development, and technological and process innovation.

Operational Risks

2. Industry Policy Risks: The EU carbon tariff policy takes effect on January 1, 2026, potentially impacting export business; changes in downstream industries like wind power, photovoltaics, and new energy vehicles may also affect upstream carbon fiber industry.
3. Raw Material and Energy Price Fluctuation Risks: Prices of raw materials like acrylonitrile are affected by international oil prices, and natural gas and electricity prices also face upward risks. Significant increases could raise production costs.

Financial Risks

2. Performance Volatility Risks: The company’s profitability is influenced by macroeconomic cycles, industry policies, and market competition. Major changes could lead to supply-demand fluctuations downstream, affecting operations.
3. Gross Margin Fluctuation Risks: As domestic carbon fiber capacity expands, market supply and demand dynamics may impact bargaining power, leading to potential volatility in gross margins.

Industry Risks

The industry faces phased supply-demand adjustments due to capacity releases, ongoing technological upgrades, and evolving technical barriers; emerging application markets require time to develop, and industrialization progress may face uncertainties.

Macroeconomic Environment Risks

Cross-cycle macroeconomic policy adjustments and delayed policy transmission may cause downstream demand fluctuations, impacting company operations and market expansion strategies.

Executive and Senior Management Compensation: Chairman and General Manager Lead

In 2025, Chairman Zhang Jian received a pre-tax total compensation of 1.8955 million yuan; General Manager Chen Qiufei received 1.8007 million yuan; Vice Presidents Lian Feng, Li Wei, Jin Liang, Wang Nuan, and Xi Yusong received 1.4285 million yuan, 1.3806 million yuan, 1.2706 million yuan, 1.2004 million yuan, and 1.028 million yuan respectively.

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