Ultrasound Electronics 2025 Annual Report Analysis: Operating Cash Flow Increased by 47.41%, Financial Expenses Soared by 534.28%

Interpretation of Core Profitability Indicators

Operating Revenue Grows Steadily

In 2025, the company achieved operating revenue of 6.331 billion yuan, up 9.98% year over year, sustaining a growth trend for three consecutive years. By product segment, printed circuit board revenue was 3.150 billion yuan, up 13.44% year over year, becoming the core driver of revenue growth; rigid copper-clad laminates revenue was 1.109 billion yuan, up 11.94%; and liquid crystal display revenue was 1.744 billion yuan, up only 1.67% year over year, with a clearly slowed growth rate. By region, domestic revenue was 3.578 billion yuan, up 16.38%, with a growth rate far exceeding the 2.65% of overseas revenue; the domestic market became the main growth engine.

Divergence Between Net Profit and Non-GAAP Net Profit

In 2025, the company’s net profit attributable to shareholders of listed companies was 222 million yuan, up 3.10%; net profit after excluding non-recurring gains and losses was 219 million yuan, up 8.65%, with a growth rate significantly higher than that of net profit. The difference in growth rates between the two mainly stems from a sharp decrease in non-recurring gains and losses. In 2025, non-recurring gains and losses were 3.7412 million yuan, down 74.13% from 14.4654 million yuan in 2024. Of this, government subsidies decreased from 6.0077 million yuan to 4.1559 million yuan, and gains from the disposal of financial assets decreased from 10.8911 million yuan to 7.5922 million yuan.

Earnings Per Share Improves Slightly

In 2025, basic earnings per share was 0.4143 yuan per share, up 3.11% year over year; non-GAAP earnings per share was 0.4073 yuan per share, up 8.62% year over year, which largely matches the growth rate of non-GAAP net profit. The increase in earnings per share mainly benefits from a slight increase in net profit. Meanwhile, the company’s share capital increased only by 10,500 shares due to conversion of convertible bonds, resulting in an immaterial impact on earnings per share.

Deep Dive Into the Cost Structure

Overall Expense Situation

In 2025, the company’s total period expenses were 751 million yuan, up 10.12%. The growth rate was lower than that of operating revenue (9.98%), indicating effective overall expense management.

Selling Expenses Grow Relatively Fast

Selling expenses increased 14.33% year over year, mainly due to higher employee compensation and packaging costs. The company stepped up its market expansion efforts, especially in developing the domestic market, which led to higher selling expenses. However, the selling expense ratio was 2.46%, only slightly higher than 2.37% in 2024; overall sales efficiency remained stable.

Administrative Expenses Largely Stable

Administrative expenses increased only 0.71% year over year, mainly due to higher employee compensation costs. Through optimizing management processes and compressing non-essential expenditures, the company kept the administrative expense ratio at a relatively low level of 4.30%, demonstrating strong cost control capabilities.

Finance Expenses Surge Significantly

Finance expenses surged 534.28% year over year, the most prominent change on the expense side. The main reason is that last year’s exchange gains were large, while this year it turned into exchange losses. In 2024, the company generated substantial exchange gains, while in 2025 fluctuations in the RMB exchange rate increased exchange losses. At the same time, interest expense remained at a relatively high level, jointly driving a sharp rise in finance expenses.

R&D Expenses Grow Steadily

R&D expenses increased 0.96% year over year. The growth rate slowed compared with 2024, but the scale of R&D investment still remained high at 288 million yuan. The company’s R&D investment is mainly used for technological innovation in areas such as high-end PCBs, automotive displays, and rigid copper-clad laminates. During the year, the company carried out 140 R&D projects, completed 67 and put them into production and application, and obtained 62 patent authorizations, including 30 invention patents, continuously strengthening technological competitiveness.

Analysis of R&D Personnel

In 2025, the company had 1,089 R&D personnel, down 7.24% year over year. The proportion of R&D personnel decreased from 15.27% to 14.46%. Regarding the education structure of R&D personnel, the number of bachelor’s degree holders decreased from 716 to 689; the number of master’s degree holders decreased from 80 to 68, meaning the number of highly educated R&D personnel declined. However, R&D personnel under 30 years old increased from 177 to 197, up 11.30% year over year, and the proportion of young R&D personnel rose, injecting new vitality into the R&D team. The decline in the number of R&D personnel was mainly due to the company optimizing the structure of its R&D team, focusing on core R&D projects, and improving R&D efficiency.

Interpretation of Cash Flow

Overall Cash Flow Situation

In 2025, the net increase in cash and cash equivalents was -41.3738 million yuan, narrowing significantly compared with -198.6021 million yuan in 2024, indicating an improvement in cash flow conditions.

Operating Cash Flow Improves Significantly

Net cash flow from operating activities increased 47.41% year over year, mainly because cash received from the sale of goods increased. In 2025, the company’s collection of payments from sales was good. Subtotal cash inflows from operating activities were 4.811 billion yuan, up 11.28% year over year. Meanwhile, subtotal cash outflows from operating activities were 4.124 billion yuan, up only 6.91% year over year. With effective cost and expense controls, these jointly drove a substantial increase in net cash flow from operating activities.

Investing Cash Flow Outflows Widen

Net cash flow from investing activities decreased 57.90% year over year, mainly due to the purchase of structured deposits of 1.8 billion yuan, which led to an increase in investment cash payments. In 2025, the company increased its financial management investment efforts. Subtotal cash outflows from investing activities were 3.254 billion yuan, up 27.38%; meanwhile, subtotal cash inflows from investing activities were 2.810 billion yuan, up 23.60%. Since the inflow growth rate was lower than the outflow growth rate, net investing cash flow further turned negative.

Financing Cash Flow Pressure Eases

Net cash flow from financing activities increased 27.28% year over year, mainly because the company repaid more bank borrowings in the prior year, reducing the repayment pressure in 2025. In 2025, subtotal cash outflows from financing activities were 829 million yuan, up 19.83%, far lower than the large outflows in 2024. At the same time, subtotal cash inflows from financing activities were 531 million yuan, up 88.20%, mainly because borrowings increased, narrowing the gap in net financing cash flow somewhat.

Risk Factor Disclosures

Risk of Macroeconomic Volatility

The electronic industry in which the company operates is highly related to the macroeconomy. If there is significant macroeconomic volatility, it will affect the business conditions of downstream industries such as automotive electronics, industrial control, and consumer electronics, thereby leading to a decline in demand for the company’s products.

Risk of Intensifying Market Competition

The electronics industry undergoes rapid technological iteration, and trends toward product premiumization and concentration are evident. The company faces intense competition from competitors at home and abroad. If the company cannot continuously innovate technologically and optimize its product mix, its competitive advantage may be weakened.

Risk of Exchange Rate Fluctuations

The company’s overseas revenue accounts for 43.48%. Fluctuations in the RMB exchange rate will directly affect the company’s foreign exchange gains and losses and its international product competitiveness. The sharp increase in finance expenses in 2025 has already highlighted exchange-rate risk. In the future, exchange-rate fluctuations will still affect the company’s performance.

Risk of Fluctuations in Raw Material Prices

The prices of key raw materials required for production—such as rigid copper-clad laminates, copper balls, and copper foil—fluctuate significantly. Although the company responds with measures such as supply chain management and product pricing, large raw material price swings will still pose challenges to cost control and profitability.

Remuneration of Directors, Supervisors, and Senior Management

In 2025, the total pre-tax remuneration paid by the company to its directors, supervisors, and senior management was 6.1139 million yuan. Among them, the Chairman Mo Yibin’s pre-tax remuneration was 1.2603 million yuan, the General Manager Lin Min’s pre-tax remuneration was 1.1105 million yuan, Vice General Manager Chen Dongping’s pre-tax remuneration was 1.0132 million yuan, and Vice General Manager Yang Xiao’s pre-tax remuneration was 1.6334 million yuan. Yang Xiao’s remuneration is relatively high mainly because he also serves as the General Manager of its subsidiary Shantou Gaowei Electronic Technology Co., Ltd., and remuneration is linked to the subsidiary’s operating performance. The remuneration for external directors and independent directors was both 0.104 million yuan, and the pay level aligns with market practice.

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Responsible editor: Xiao Lang Express