Beijing Mining Inspection 2025 Annual Report Analysis: Net profit increased by 40.07% to 772 million yuan; operating cash flow rose by 58.56%

Operating Revenue: Revenue scale expands steadily, with the instruments business leading in growth

In 2025, the company achieved operating revenue of RMB 1.87B, up 26.60% year over year. Revenue scale continued to expand. From the perspective of business structure, the testing and inspection business remains the core source of revenue, generating revenue of RMB 1.74B for the full year, up 26.20% year over year, accounting for 92.92% of total operating revenue. Instruments business revenue was RMB 129.17 million, up 29.93% year over year, higher than the testing and inspection business; it has become an important supplement to revenue growth. Other business revenue was RMB 358k, up sharply by 227.17% year over year, but its share remains relatively low.

By region, domestic business revenue was RMB 1.86B, up 26.69% year over year, and is the main support for operating revenue; overseas business revenue was RMB 1.1546 million, up 12.76% year over year, with a relatively small scale.

Net Profit: Profitability improves significantly, and the impact from non-recurring gains and losses is limited

During the reporting period, the company’s net profit attributable to shareholders of the listed company was RMB 772.28 million, up significantly 40.07% year over year. The growth rate was clearly higher than that of revenue, and profitability improved notably. Net profit after excluding non-recurring gains and losses was RMB 756.10 million, up 49.34% year over year, with a faster growth rate, indicating that the company’s core profit-generating business has continuously strengthened its profitability.

Net non-recurring gains and losses were RMB 1.6132 million, with a relatively small impact on net profit. They mainly came from government subsidies, gains from disposal of financial assets, etc. Among them, government subsidies recognized in profit or loss for the current period were RMB 2.0441 million, decreased from RMB 5.1122 million in the same period of the prior year.

Earnings per Share: Earnings grow in tandem, with stronger performance for the non-recurring-excluded metric

In 2025, the company’s basic earnings per share were RMB 0.88 per share, up 35.38% year over year; diluted earnings per share after excluding non-recurring items were RMB 0.87 per share, up 45.00% year over year, consistent with the growth trends of net profit and net profit after excluding non-recurring items. The growth in earnings per share mainly benefited from the company’s significant improvement in net profit. Meanwhile, during the reporting period the company completed a public offering of shares; total share capital increased from 84.96 million shares to 113.28 million shares. Even with the expansion of share capital, the company still achieved an increase in earnings per share, further demonstrating the company’s strong profitability.

Expenses: Overall expense ratio declines, and financial expenses change sharply

In 2025, the company’s total period expenses were RMB 224 million, decreasing RMB 131 million year over year. The period expense ratio fell from 20.67% last year to 11.97%, showing significant results in expense control.

Selling expenses: Slight increase following the scale of revenue

Selling expenses were RMB 2.1502 million, up 16.01% year over year, mainly due to increases in staff compensation, office and communications expenses, and other items as the business scale expanded. The selling expense ratio was 1.15%, slightly lower than 1.25% last year, indicating improved efficiency of expense deployment.

Administrative expenses: Scale declines, and management and control effectiveness becomes evident

Administrative expenses were RMB 16.6234 million, down 7.57% year over year, mainly due to decreases in staff compensation, fees for intermediary institutions, and other spending. The administrative expense ratio decreased from 12.15% last year to 8.87%. The company achieved results in cost control at the management level.

Financial expenses: Deepening negative trend, with a big jump in interest income

Financial expenses were RMB -9.2812 million, decreasing sharply by 426.53% year over year. The main reason was an increase in interest income from bank deposits and large-denomination time deposit products. During the reporting period, interest income reached RMB 9.7673 million, up 324.62% from RMB 2.3002 million in the previous year.

R&D expenses: Slight decline in investment scale, with the proportion of revenue falling

R&D expenses were RMB 12.9435 million, down 6.15% year over year. The proportion of R&D investment to operating revenue fell from 9.32% last year to 6.91%. In terms of the structure of R&D investment, staff compensation and analysis, testing, and processing fees decreased, while material costs increased somewhat.

R&D personnel: Team size expands slightly, while the structure remains stable

As of the end of 2025, the company had a total of 22 R&D personnel, an increase of 3 from 19 at the beginning of the period. The proportion of R&D personnel among total employees increased from 9.6% to 10.2%. In terms of education level, the proportion of R&D personnel with a master’s degree or above exceeded 81.82%. Among them, there was 1 PhD and 17 master’s degree holders. The R&D team’s overall education level is high, and professional capabilities are strong, providing talent support for the company’s technological innovation.

Cash Flow: Clear divergence among the three types of cash flows, with operating cash flow increasing sharply

Cash flow from operating activities: Net inflow surges, strengthening “cash-making” capability

The net cash flow from operating activities was RMB 1.02B, up 58.56% year over year. The growth rate was significantly higher than that of revenue and net profit. This was mainly because the company’s operating business grew steadily; cash received from selling goods and providing services increased to RMB 2.03B, up 34.19% year over year. At the same time, cash paid for purchasing goods and receiving services declined to some extent. The inflow/outflow structure of operating cash flow improved, and the company’s own cash-making capability continued to strengthen.

Cash flow from investing activities: Large net cash outflow, with increased allocations to large-denomination time deposits

The net cash flow from investing activities was RMB -3.06B, decreasing sharply by 2,772.05% year over year. The main reason was that during the year the company purchased RMB 300 million in large-denomination time deposits, leading to a significant increase in cash outflow from investing activities. During the reporting period, cash inflow from investing activities was only RMB 0.8049 million, mainly cash received from recovering investments and receiving investment returns.

Cash flow from financing activities: Net balance turns from negative to positive, with raised funds arriving

The net cash flow from financing activities was RMB 1.4733 billion, up 800.65% year over year. This was mainly because the company received the net proceeds of RMB 1.73B from a public issuance of shares on the Beijing Stock Exchange. Meanwhile, cash outflows such as cash dividends paid and issuance expenses were RMB 317 million. As a result, the net financing cash flow changed from net outflow in the prior year to net inflow.

Risks that may be faced: Multiple risks still require caution

Risk of damage to brand credibility

Brand credibility is the core competitive strength of third-party testing and inspection institutions. If negative events occur—such as employee operational errors, gaps in internal quality management, customer disputes, and other incidents—it may lead to damage to the company’s brand credibility, and even affect business qualifications, thereby impacting profitability and sustainable operating capability. The company needs to continuously strengthen compliant operations and quality management, improve internal systems, and enhance employee training.

Risk of fluctuations in market demand

The demand for the company’s testing and inspection business is closely related to trading scale in the mining and metallurgy industry. If in the future the mining and metallurgy industry experiences a contraction in trading scale due to factors such as macroeconomic conditions and conditions across the upstream and downstream of the industrial chain, it will directly cause the company’s testing and inspection demand to shrink, and there will be a risk of performance decline. The company needs to actively expand its business scope and reduce reliance on a single industry.

Risk of intensifying market competition

The marketization level of the testing and inspection industry continues to deepen, and the number of institutions may further increase. At the same time, institutions in other sub-sectors may also enter the field where the company operates, making competition increasingly fierce. If the company cannot respond effectively to competition, its market share may be squeezed and its growth in performance will be constrained. The company needs to continuously enhance its technical strength and service quality to consolidate its market position.

Risk of a single main business

The testing and inspection business accounts for more than 90% of the company’s revenue. Although the company actively develops its instruments business, its current scale is still relatively small. If the testing and inspection business suffers unfavorable impacts, it could have a significant effect on the company’s overall performance. The company needs to increase R&D and market promotion efforts for the instruments business and optimize its business structure.

Risk of insufficient talent or talent loss

The testing and inspection industry is a technology-intensive sector, with long training cycles for professional technical talent. The company faces pressure from an insufficient number of talent. Meanwhile, as competition in the industry intensifies, talent acquisition may become increasingly fierce. If the company’s talent incentive, recruitment, and training mechanisms are not well developed, it may face the risk of talent loss, affecting the company’s sustainable development. The company needs to improve its compensation and incentive system, keep career development channels open, and enhance talent cohesion.

Risk of defects in the title of leased properties

Some properties owned by the mining and metallurgy group that the company leases have not yet obtained title certificates. If in the future it becomes impossible to continue leasing due to title defects, the company will face risks of relocation and losses from production stoppage. Although the mining and metallurgy group has issued relevant commitments, there is still some uncertainty.

Compensation of executives and directors/monitors: Core executive compensation linked to performance

Chairman—pre-tax compensation

The total pre-tax compensation received by Chairman Li Huachang from the company during the reporting period was RMB 1.24M. The basis for assessment was operating performance and completion of job responsibilities, and the company has completed the annual assessment target.

General Manager—pre-tax compensation

The total pre-tax compensation received by General Manager Yu Li during the reporting period was RMB 1.23M. The basis for assessment was also operating performance and completion of job responsibilities, and the company has completed the assessment.

Deputy General Managers—pre-tax compensation

The total pre-tax compensation received by Deputy General Managers Shi Yehong and Jiang Qiutao during the reporting period were RMB 1.0674 million and RMB 0.9969 million, respectively. Both have completed the annual operating performance and job responsibility assessment targets. Compensation is linked to performance completion.

Chief Financial Officer—pre-tax compensation

The total pre-tax compensation received by Chief Financial Officer and board secretary Li Riqiang during the reporting period was RMB 1.0953 million. The basis for assessment was operating performance and completion of job responsibilities, and the company has completed the assessment.

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