Zhimingda 2025 Annual Report Interpretation: Net profit increased by 425.27% to 102 million yuan, operating cash flow turned negative, decreasing by 216.14%

Core Profitability Indicators Interpretation

Operating Revenue: Order-Driven Revenue Surges 61.87%

In 2025, the company achieved operating revenue of 708,867,237.23 yuan, a year-over-year increase of 61.87%, mainly due to a significant rise in customer demand, a substantial increase in order volume, and a corresponding expansion in delivery scale. By product, embedded computers for missile payloads saw a year-over-year jump of 167.09% to 118,626,651.84 yuan, becoming the main driver of revenue growth; embedded computers for airborne and commercial aerospace increased by 50.85% and 199.69% respectively, indicating a comprehensive expansion across the business.

Net Profit: Scale Control + Revenue Growth Drive 425.27% Surge

Net profit attributable to shareholders of the listed company was 102,190,314.80 yuan, a significant increase of 425.27% year-over-year. The growth mainly stems from two factors: first, a sharp increase in operating revenue boosting the profit base; second, effective management of operational scale, with a notable decrease in period expense rates, further amplifying profit elasticity.

Non-Recurring Net Profit: Significant Improvement in Profit Quality, Up 704.06% YoY

Net profit after deducting non-recurring gains and losses was 97,486,300.94 yuan, up 704.06% year-over-year, far exceeding the net profit growth rate. This indicates a substantial enhancement in the company’s core business profitability, with a further reduction in the impact of non-operating gains and losses on profits, continuously optimizing profit quality.

Earnings Per Share: Despite Capital Dilution, Rapid Growth Achieved

Basic earnings per share were 0.61 yuan/share, up 408.33%; non-recurring EPS was 0.58 yuan/share, up 728.57%. Although during the reporting period, the company increased total share capital from 112,561,524 shares to 173,906,404 shares through capital reserve conversion and private placements, EPS still grew several times, demonstrating strong resilience in profit growth.

Period Expense Analysis

Overall Expenses: Scale Effect Evident, Period Expense Ratio Declines

During the reporting period, total sales, management, R&D, and financial expenses amounted to 171,032,079.16 yuan, an increase of 1.77%, far below the 61.87% revenue growth. The period expense ratio dropped from 48.33% last year to 24.13%, highlighting scale effects.

Sales Expenses: Slight Increase of 5.33% with Revenue Growth

Sales expenses were 25,775,249.31 yuan, up 5.33%, mainly driven by increased revenue leading to higher business entertainment and travel expenses. The sales expense ratio decreased from 5.59% last year to 3.64%, indicating improved expense efficiency.

Management Expenses: Inventory Losses Increase, Up 11.82%

Management expenses totaled 49,802,609.65 yuan, up 11.82%, mainly due to increased inventory write-offs during the period, with inventory loss expenses rising by 61.25% to 11,722,842.96 yuan. The management expense ratio fell from 10.17% to 7.03%, showing overall improved control.

Financial Expenses: Increased Discounting, Up 9.38%

Financial expenses were 2,948,106.54 yuan, up 9.38%, mainly because the company increased bill discounting activities based on operational needs, with discounting interest rising by 352.68% to 584,233.23 yuan.

R&D Expenses: Personnel Reduction + Unmet Equity Incentives, Down 6.58%

R&D expenses amounted to 92,506,114.66 yuan, down 6.58%. On one hand, R&D personnel decreased from 270 to 250, with corresponding salary expenses declining; on the other hand, some equity incentives did not meet exercise conditions, reducing share-based payment expenses, leading to a decrease in R&D costs. Nonetheless, the company maintains high R&D investment intensity, with R&D expenditure accounting for 13.05% of operating revenue, continuing to advance core technologies such as next-generation avionic buses and ultra-high-speed inter-board communication buses.

R&D Personnel: Slight Decrease in Number, Continued Optimization of Structure

At the end of the period, R&D personnel numbered 250, accounting for 48.83% of total staff, a decrease from 270 last year-end, but total R&D salary expenditure was 77.9964 million yuan, with an average salary of 290.6k yuan, up 5.29% year-over-year, indicating improved compensation for core R&D staff. In terms of educational background, 47 R&D personnel hold master’s degrees or higher, accounting for 18.8%, maintaining a high level of professional qualification.

Cash Flow Analysis

Operating Cash Flow: Turns Negative, Net Decreases by 216.14%

Net cash flow from operating activities was -71,525,921.32 yuan, a decrease of 216.14% year-over-year, mainly due to two factors: first, lower sales collection compared to the same period last year, with cash inflows growing slower than outflows; second, increased orders driving higher procurement payments, with cash paid for purchases and labor services rising by 33.61% to 289,652,991.94 yuan, leading to a significant increase in operating cash outflows.

Investing Cash Flow: Narrowed Net Outflow

Net cash flow from investing activities was -17,145,320.68 yuan, compared to -62,087,042.64 yuan last year, a substantial reduction in net outflow. This was mainly because large payments for production base buildings and renovations made in the previous year were absent this period, and the company recovered 290.6k yuan from investment cash inflows, offsetting part of the outflows.

Financing Cash Flow: Refinance + New Borrowings Drive Large Increase in Net Inflows

Net cash flow from financing activities was 261,601,582.06 yuan, turning positive from -49,342,895.02 yuan last year, a significant increase. On one hand, the company completed a private placement of shares to specific investors, raising 208,275,977.04 yuan; on the other hand, to support operational development, it added new bank loans of 717.2k yuan, greatly boosting financing cash inflows.

Risk Factors Interpretation

Core Competitiveness Risks: Technology Iteration and Talent Loss Risks Need Attention

As a technology-intensive enterprise, failure to accurately grasp technological, product, and market demand trends may lead to wrong development directions, project failures; additionally, inability to maintain effective talent attraction and incentive mechanisms could result in key personnel attrition, adversely affecting R&D progress and technological leadership.

Operational Risks: Customer Concentration and Supply Chain Dependence Coexist

The company’s main clients are subsidiaries of large domestic state-owned key industry groups, with high customer concentration. Changes in industry policies or customer needs could directly impact performance. Moreover, products in key national fields require stable supply of core raw materials; some critical component suppliers are relatively fixed. If suppliers cannot deliver timely or prices fluctuate significantly, production and profitability could be affected.

Financial Risks: Rising Accounts Receivable and Inventory Levels

With business expansion, accounts receivable at period-end reached 989,508,578.91 yuan, up 45.33%, posing potential collection and turnover risks. Inventory at period-end was 245,061,127.24 yuan, up 6.89%. If market demand shifts or product competitiveness declines, inventory backlog and devaluation risks may arise.

Industry Risks: Uncertainty in Emerging Field Expansion

The company’s revenue share from emerging fields like low-altitude economy and commercial aerospace remains small, as these areas are still in early industrialization stages. Market cultivation and large-scale application require time; if market demand falls short of expectations, it could impact the company’s new growth trajectory.

Executive and Senior Management Compensation Interpretation

During the period, Chairman Wang Yong received a pre-tax remuneration of 1.8434 million yuan; General Manager Long Bo received 1.9468 million yuan; Vice Presidents Qin Yin, Wan Chonggang, and Li Wei received 717.2k yuan, 941.4k yuan, and 496.4k yuan respectively; CFO Liu Xin Zhu received 434.1k yuan. Compensation levels align with industry standards and company performance, with core management incentives linked to profitability, demonstrating effective incentive mechanisms.

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