Hegang New Energy 2025 Annual Report Analysis: Net profit attributable to parent company soars by 502.28%, net cash flow from investing activities plummets by 5673.89%

Core Revenue Profit Indicator Interpretation

Operating Revenue: Photovoltaic EPC Drives Revenue Growth of 55.95%

In 2025, the company achieved an operating revenue of 7.449 billion yuan, a year-on-year increase of 55.95%. By business segment, the new energy business contributed 6.7 billion yuan in revenue, a year-on-year increase of 73.90%, of which the photovoltaic EPC business generated 6.583 billion yuan, a year-on-year increase of 77.17%, serving as the core driver of revenue growth; the industrial automation business revenue was 503 million yuan, a slight increase of 0.12%; other businesses generated 245 million yuan, a year-on-year decrease of 41.78%.

By region, domestic market revenue was 7.212 billion yuan, a year-on-year increase of 59.76%, accounting for 96.82% of total revenue; overseas market revenue was 237 million yuan, a year-on-year decrease of 9.64%.

Net Profit Attributable to Shareholders: Non-recurring Gains Boost Net Profit by 502.28%

During the reporting period, the company achieved a net profit attributable to shareholders of 62.012 million yuan, a significant year-on-year increase of 502.28%. However, the net profit after deducting non-recurring gains was only 10.6126 million yuan, a year-on-year increase of 38.96%, with the main growth driver coming from non-recurring gains, which totaled 51.3994 million yuan for the year, including a loss from the disposal of non-current assets of 24.6558 million yuan and government subsidies recognized in the current period amounting to 42.7061 million yuan.

Earnings Per Share: Basic Earnings Per Share of 0.06 Yuan, Year-on-Year Growth of 500%

The company’s basic earnings per share were 0.06 yuan/share, a year-on-year increase of 500%; the earnings per share excluding non-recurring items were 0.01 yuan/share, a year-on-year increase of 38.96%, consistent with the growth rate of net profit excluding non-recurring items.

In-Depth Analysis of Expense Structure

In 2025, the company’s total period expenses amounted to 6.420 billion yuan, a year-on-year increase of 11.22%, with expense growth rate lower than revenue growth rate, demonstrating effective expense control.

Selling Expenses: Growth in Line with Revenue Expansion

Selling expenses increased by 16.33% year-on-year, mainly due to the expansion of revenue scale, with corresponding increases in wages, travel expenses, and transportation and handling fees; among them, wage and welfare expenses increased by 177 million yuan to 944 million yuan, and transportation and handling fees increased by 96 million yuan to 274 million yuan.

Management Expenses: Increase in Labor and Consulting Fees Drives Growth

Management expenses increased by 10.94% year-on-year, mainly due to increases in personnel compensation (wage, insurance, and welfare increased by 76 million yuan to 506 million yuan), growth in intermediary consulting fees (increased by 53 million yuan to 64 million yuan), and an increase in financial insurance expenses of 37 million yuan to 85 million yuan.

Financial Expenses: Changes in Exchange Gains and Losses Lead to Expanded Net Income

Financial expenses amounted to a net income of 9.5963 million yuan, an increase of 2.2585 million yuan year-on-year, mainly due to changes in exchange gains and losses during the reporting period, with an exchange loss of 4.5222 million yuan for the year, while there was an exchange gain of 206,000 yuan in 2024, and the difference between interest income and interest expenses slightly widened.

R&D Expenses: Continued Investment Strengthens Technical Barriers

R&D expenses increased by 9.30% to 350 million yuan year-on-year, mainly used for the technological research and development of products such as high-voltage frequency converters, photovoltaic inverters, and household energy storage. Throughout the year, 258 million yuan was invested in labor costs, 3.0785 million yuan in material consumption, and 88.9609 million yuan in other expenses, with continued R&D investment supporting the company’s technological leadership in the new energy and industrial automation fields.

R&D Personnel Situation

At the end of the reporting period, the number of R&D personnel in the company was 431, a decrease of 14.65% from 505 in 2024. The proportion of R&D personnel to total employees dropped from 41.60% to 38.24%. In terms of educational structure, over 87.70% of R&D personnel hold a bachelor’s degree or higher, with 105 holding a master’s degree or above, accounting for 24.36% of R&D personnel; in terms of age structure, R&D personnel aged 30-40 accounted for 50.35%, making them the core strength of R&D.

Cash Flow Situation Analysis

In 2025, the company’s net increase in cash and cash equivalents was 195 million yuan, a year-on-year decrease of 41.01%, with three types of cash flows showing divergent trends:

Operating Activity Cash Flow: Expenditure Growth Exceeds Revenue, Net Amount Declines Year-on-Year

Cash inflow from operating activities was 7.890 billion yuan, a year-on-year increase of 63.42%, mainly due to increased cash receipts from expanded sales scale; cash outflow from operating activities was 7.642 billion yuan, a year-on-year increase of 69.00%, with cash payments for purchasing goods and receiving services amounting to 6.288 billion yuan, a year-on-year increase of 85.92%, leading to a year-on-year decrease of 58.07 million yuan in net cash flow from operating activities.

Investing Activity Cash Flow: Large Purchases of Deposit Products Cause Net Amount to Plummet

Cash inflow from investing activities was 1.805 billion yuan, a year-on-year increase of 1048.32%, mainly due to increased principal and interest received from deposit products; cash outflow from investing activities was 1.903 billion yuan, a year-on-year increase of 1124.54%, mainly due to the purchase of deposit products amounting to 1.4 billion yuan during the reporting period, far exceeding 100 million yuan in 2024, resulting in the net cash flow from investing activities turning negative, a year-on-year decrease of approximately 1 billion yuan.

Financing Activity Cash Flow: Share Payment Exercise Drives Cash Flow Growth

Cash inflow from financing activities was 57.4871 million yuan, a year-on-year increase of 122.87%, mainly due to increased cash received from share payment exercises; cash outflow from financing activities was 11.8915 million yuan, a year-on-year increase of 310.83%, mainly due to increased fixed payments for lease liabilities, but the overall net cash flow from financing activities still increased by 22.70 million yuan year-on-year.

Potential Risks

2. Market Competition Risk: The new energy fields such as photovoltaics and energy storage are highly competitive, with industry overcapacity and ongoing price wars, which may lead to a decline in gross margin for the company’s photovoltaic EPC business; the industrial automation sector also faces dual competition from foreign brands and leading domestic enterprises.
3. Policy Change Risk: The new energy industry relies on policy support; if subsidies decline or grid connection policies are adjusted, it may affect the profit margins of the company’s household energy storage and photovoltaic EPC businesses.
4. Overseas Market Risk: Although the overseas market revenue proportion is low, it faces risks from exchange rate fluctuations, trade barriers, and changes in local policies, with overseas revenue already showing a decline in 2025.
5. Accounts Receivable Collection Risk: The accounts receivable balance at the end of the period was 1.088 billion yuan, a year-on-year increase of 10.90%; if downstream customers’ operating conditions worsen, there may be difficulties in collecting accounts receivable.

Executive Compensation Situation

During the reporting period, the total pre-tax compensation received by the company’s Chairman and General Manager Lu Jianfeng was 3.7995 million yuan; Vice President and CFO Wang Wenliang received a total pre-tax compensation of 1.6970 million yuan; Vice President Liu Yi received a total pre-tax compensation of 3.3927 million yuan; Board Secretary Xu Qinhong received a total pre-tax compensation of 798,500 yuan. Independent directors received a pre-tax compensation of 120,000 yuan per person. Overall, the compensation of core executives is linked to the company’s performance growth and is in line with industry compensation levels.

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Editor: Xiao Lang Fast Report