Shanghai Mechatronics 2025 Annual Report Analysis: Net profit attributable to parent company down 15.45% year-over-year; operating cash flow decreased by 11%

Core Profitability Metrics Under Pressure, Profit Quality Needs Improvement

Operating Revenue: Down 6.71% Year over Year, Multiple Business Segments Decline

In 2025, Shanghai Electric Machine achieved operating revenue of 19.294 billion yuan, down 6.71% year over year from 20.682 billion yuan in 2024. By business segment, elevator business revenue—accounting for the core of revenue—was 18.362 billion yuan, down 5.35% year over year, which remains the main drag on revenue decline. Printing and packaging business revenue was 218 million yuan, down sharply by 37.91% year over year; other business revenue was 188 million yuan, down 53.61% year over year; only hydraulic machinery business revenue increased slightly by 1.12%.

Net Profit Attributable to Shareholders: Down 15.45% YoY; Non-Recurring Gains Support Earnings

In 2025, the net profit attributable to shareholders of the listed company was 792 million yuan, down 15.45% from 937 million yuan in 2024. Net profit after deducting non-recurring items was 640 million yuan, down 12.55% year over year. The supporting effect of non-recurring items on profit is evident. In 2025, total non-recurring items aggregated 152 million yuan, of which gains from disposal of non-current assets amounted to 185 million yuan, mainly contributed by compensation payments for the acquisition of premises by Shanghai SMIKE Welding Materials Co., Ltd., a subsidiary.

Earnings Per Share: Moving Down in Sync; Earnings Dilution Effect Becomes Apparent

Basic earnings per share were 0.77 yuan per share, down 16.30% year over year from 0.92 yuan per share in 2024. Earnings per share after deducting non-recurring items were 0.63 yuan per share, down 12.50% year over year. This aligns with the trend in net profit changes and reflects the dilution effect on the company’s earnings level.

Cost Control Shows Results; R&D Investment Still Maintains Scale

Period Expenses Overall Contract; Financial Gains Narrow

In 2025, the company’s total period expenses were 185 million yuan, slightly down from 191 million yuan in 2024. Specifically:

• Selling expenses: 555 million yuan, down 6.73% year over year, mainly because agency and commissions, market development expenses, and other costs decreased along with the contraction in revenue scale;
• Administrative expenses: 790 million yuan, down 4.83% year over year, mainly due to improved control and management of external support fees, office expenses, and so on;
• Financial expenses: -221 million yuan—still a net gain, but narrower than -282 million yuan in 2024, mainly because interest income on deposits fell from 295 million yuan to 238 million yuan;
• R&D expenses: 725 million yuan, down 5.32% year over year, but the total R&D investment still reached 729 million yuan, representing 3.78% of operating revenue, maintaining ongoing investment in technical R&D.

R&D Staff Structure Stays Stable; Core Team Supports Technological Innovation

The company has 617 R&D personnel, accounting for 14.03% of its total headcount. In terms of educational background, 228 people have a master’s degree or above, representing 36.95%; 312 people have a bachelor’s degree, representing 50.57%. The share of high-education talent is nearly nine-tenths. In terms of age structure, there are 335 R&D personnel aged 30–50, representing 54.30%, forming a stable core R&D team that supports the company’s technological innovation.

Pressure on Cash Flow Emerges; Cash Outflows from Investing and Financing Activities Contract

Cash Flow from Operating Activities: Down 11% YoY; Lower Sales Collections Are the Main Cause

In 2025, net cash flow generated from operating activities was 799 million yuan, down 11.00% from 897 million yuan in 2024. The main reason is that cash received from selling goods and providing services decreased from 18.746 billion yuan to 18.469 billion yuan. Meanwhile, cash paid for buying goods and receiving services still totaled 14.610 billion yuan, causing net operating cash inflows to narrow.

Cash Flow from Investing Activities: Shifted from Net Inflow to Net Outflow; Scale of Short-Term Wealth Management Contracts

Net cash flow generated from investing activities was -61 million yuan, compared with a net inflow of 143 million yuan in 2024. The main reasons include a significant reduction in newly added time deposits of more than three months during the period. Cash outflows from investing activities increased from 706 million yuan to 606 million yuan. At the same time, net cash proceeds recovered from the disposal of long-term assets such as fixed assets decreased from 214 million yuan to 23 million yuan.

Cash Flow from Financing Activities: Net Outflow Narrows; Dividend Scale Declines

Net cash flow generated from financing activities was -667 million yuan, narrowing the net outflow scale compared with -1.253 billion yuan in 2024. The main reason is that cash paid for distributing dividends, profits, or paying interest decreased from 1.155 billion yuan to 637 million yuan. Specifically, dividends paid by subsidiaries to minority shareholders decreased from 499 million yuan to 207 million yuan.

Market Risks Remain; Volatility in the Real-Estate Chain Continues to Affect Operations

The company’s core risks still lie in market risk: market volatility in the real estate industry has intensified competition in the elevator market, compressing companies’ profit margins. In addition, tight funding in the real estate industry increases operational risks. Although the company maintains competitiveness through technological innovation and cost control, and demand for replacement and refurbishment of old elevators is gradually being released, in the short term, volatility in the real-estate chain still has some impact on the stability of the company’s operations. The pace of recovery in the downstream real estate sector needs to be continuously monitored.

Disclosure of Executive Pay; Compensation for Core Management Stays Stable

During the reporting period, the total pre-tax remuneration the company’s chairman, Zhuang Hua, received from the company was 1.0559 million yuan. The general manager position is held concurrently by Zhuang Hua, and the total pre-tax remuneration was also 1.0559 million yuan. Deputy general manager He Wei had pre-tax remuneration of 0.8922 million yuan, while Xu Junbin had pre-tax remuneration of 0.4 million yuan. The CFO, Chen Ming, had pre-tax remuneration of 0.1107 million yuan. Overall, compensation for the core management team remains stable and basically matches the company’s performance fluctuations.

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