Liande Co., Ltd. 2025 Annual Report Analysis: Net profit increased by 21.46% to 228 million yuan, with overseas revenue up 22.19% to 632 million yuan

Operating Revenue: Up 14.19% Year over Year; Overseas Business Drives Growth

In fiscal year 2025, the company achieved operating revenue of RMB 1.254 billion, up 14.19% year over year. Revenue growth was mainly driven by overseas business. During the reporting period, overseas revenue reached RMB 632 million, up 22.19%. Against the backdrop of intensifying China-U.S. trade frictions, the company achieved overseas business growth against the trend by leveraging supply-chain resilience and customer trust. At the same time, the Mexico plant is expected to start production in the second quarter of 2026, which will further meet customer demand in the North American region and consolidate the company’s core position in the global supply chain.

From quarterly data, revenue showed a trend of “increasing quarter by quarter in the first three quarters and a slight decline in the fourth quarter”:

Net Profit: Up 21.46% Year over Year; Profitability Improves Steadily

In 2025, the company achieved net profit attributable to shareholders of listed companies of RMB 227.6953 million, up 21.46% year over year. The growth rate was higher than that of operating revenue, reflecting the effectiveness of the company’s cost-reduction and efficiency-improvement measures. Through multi-dimensional cost control such as building a group-based procurement platform, refining production processes, and optimizing organizational effectiveness, the company achieved a steady improvement in profitability.

Net Profit After Non-recurring Items: Up 20.29% Year over Year; Core Business Profit Base Is Solid

In 2025, the company’s net profit after deducting non-recurring gains and losses was RMB 221.9241 million, up 20.29% year over year. It is close to the net profit growth rate, indicating that the company’s profit growth mainly comes from its principal business. Regarding non-recurring items, in 2025 the total was RMB 5.7712 million, mainly including government grants of RMB 6.6115 million, gains or losses from entrusting others with investment or asset management of RMB 1.0711 million, and others; their impact on overall profit was relatively small.

Earnings Per Share: Synchronized Growth; Shareholder Returns Improve

In 2025, the company’s basic earnings per share (EPS) was RMB 0.95 per share, up 21.79% year over year; after deducting non-recurring items, EPS was RMB 0.93 per share, up 20.78% year over year. Both indicators grew in line with net profit, and the level of earnings per share returned to shareholders increased.

Expense Control: Significant Results from Cost Reduction and Efficiency Improvement; R&D Spending Continues to Increase

Selling Expenses: Flexible Control Tailored to a Globalized Layout

During the reporting period, the company’s selling expenses increased reasonably alongside the expansion of overseas business, mainly used for building a global marketing network, including establishing a Japan marketing agent system and preparing European marketing organizations, providing support for implementing the global strategy.

Administrative Expenses: Efficiency Improvement Under Group-based Governance

By building a group-based procurement platform, optimizing the organizational structure, and other initiatives, administrative expenses achieved refined control. Non-core cost expenditures were kept under reasonable control, and organizational effectiveness improved significantly.

Finance Expenses: Cost Optimization Under Scale Effects

As the company’s operating scale expanded and the efficiency of capital use improved, finance expenses remained at a reasonable level and did not create additional pressure on profitability.

R&D Expenses: Sustained High Investment to Solidify Technical Barriers

The company has always treated R&D as its core driving force. In 2025, it continued to increase investment in technological innovation. The customized automatic programming software was successfully launched, enabling automated generation of machining programs and effectively improving production efficiency and the standardization level of machining. By the end of 2025, the company and its domestic subsidiaries had obtained 113 authorized patents in total (44 invention patents and 69 utility model patents) and 5 software copyrights. Its technical reserve and process capability remain at the forefront of the industry.

R&D Personnel: Building a Stable, Efficient R&D Team

The company has formed a full-dimensional R&D system covering technology team development, independent innovation, customer collaborative development, and industry-university-research cooperation. R&D personnel have extensive industry experience and technical capabilities, enabling deep participation in the front-end R&D design of downstream customers, achieving technical collaboration with customers and shared growth, and providing talent support for the company’s ongoing innovation.

Cash Flow: Operating Cash Flow Is Stable; Investment and Financing Match the Strategic Layout

Net Cash Flow from Operating Activities: Staying Positive Continuously; Stable “Cash-Building” Capability

In 2025, net cash flow from operating activities remained steady. Cash flows were positive in each quarter throughout the year. This reflects that the company’s principal business has strong “cash-building” capability and can provide stable funding support for daily operations, R&D investment, and capacity expansion.

Cash Flow from Investing Activities: Matching Capacity Planning and Business Integration

Cash flows from investing activities are mainly used for ramping up capacity at the Mingde plant, technical upgrades of existing production bases, construction of the Mexico plant, and integration of the hydraulics business. In 2025, the ramp-up at the Mingde plant proceeded smoothly, while Liyuan Jinhhe achieved stable profitability. Suzhou Liyuan substantially reduced losses. Investment projects gradually entered a period of benefit release, laying the foundation for the company’s long-term growth.

Cash Flow from Financing Activities: Supporting Globalization and Capacity Expansion

Cash flows from financing activities are mainly used to meet funding needs for supporting the company’s globalized layout, capacity upgrades, and business integration. Through reasonable financing arrangements, the company matches the pace of long-term strategic development and ensures the safety and stability of the capital chain.

Risks It May Face: Multiple External Challenges Require Vigilance

Risks from Trade Friction and Globalization Layout

As China-U.S. trade frictions intensify, they may have potential impacts on overseas business. Although the company uses the Mexico plant layout to mitigate some risks, uncertainty in global trade policies may still cause supply-chain volatility.

Risks from Cyclical Fluctuations in Downstream Industries

The company’s business involves multiple downstream sectors such as compressors, construction machinery, and energy power. Cyclical fluctuations in the construction machinery industry may affect related businesses, so changes in downstream demand should be monitored continuously.

Technology Iteration and Competitive Risks

The industry of high-precision components has rapid technology iteration. If the company cannot continuously maintain R&D investment and technological leadership, it may face the risk of losing market share to competitors.

Risk of Fluctuations in Raw Material Prices

Raw material costs are one of the main components of the company’s production costs. Fluctuations in raw material prices may affect the company’s profitability. The company needs to hedge risks through measures such as group-based procurement and inventory management.

Remuneration of Directors, Supervisors, and Senior Management: Linked to Operating Performance; Incentive Mechanisms Are Reasonable

During the reporting period, the total pre-tax remuneration of senior management personnel such as the company’s chairman, general manager, deputy general manager, and chief financial officer was linked to the company’s operating performance, reflecting a reasonable incentive-and-constraint mechanism. This not only ensures reasonable returns for management but also encourages them to focus on the company’s long-term development and performance improvement.

Profit Distribution Plan: RMB 3.5 Cash Dividend per 10 Shares; Returning Value to Shareholders

The company plans to use the total share capital registered on the record date for the implementation of the equity distribution (excluding the number of shares held in the share repurchase escrow account) as the base. It will distribute a cash dividend of RMB 3.5 per 10 shares to all shareholders (including tax). The company expects to distribute dividends totaling RMB 84.1875 million (including tax). The remaining undistributed profits will be carried forward for distribution in subsequent years. This plan will not include any transfer of capital reserve into share capital nor any bonus share issuance. This proposal still needs to be submitted for review at the 2025 annual general meeting of shareholders.

Click to view the original text of the announcement>>

Statement: There are risks in the market; invest with caution. This article is automatically published by an AI large model based on third-party databases and does not represent Sina Finance’s views. Any information appearing in this article is for reference only and does not constitute personal investment advice. If there are discrepancies, please refer to the actual announcement. If you have any questions, please contact biz@staff.sina.com.cn.

Huge amounts of information and precise analysis—available in the Sina Finance app

责任编辑：小浪快报