Summary of Jinggong Steel Structure Conference Call Company Overview - **Company**: Jinggong Steel Structure - **Industry**: Steel Construction and Engineering Key Financial Metrics - Operating revenue for Q3 2025 reached **14.5 billion** CNY, a **21%** year-on-year increase [3] - Net profit attributable to shareholders was **589 million** CNY, up **24%** year-on-year [3] - Operating cash flow for Q3 was **760 million** CNY, indicating strong performance [3] - Three expense ratios decreased by **1.6%** year-on-year, with ROE exceeding the previous year's total [3] Business Growth and Strategy - **Overseas Business Growth**: - Expected overseas order scale to exceed **6 billion** CNY by 2025, enhancing overall order quality [2][5] - Key growth areas include landmark projects in Saudi Arabia and industrial plants in Southeast Asia [2] - Overseas orders accounted for nearly **30%** of total platform revenue in the first three quarters [10] - **Domestic Market Strategy**: - Despite macroeconomic challenges, the company is expanding its regional layout through a franchise model, partnering with local firms to establish holding companies [6] - Anticipated **1.2 billion** CNY in new orders from this strategy [6] - **EPC Business Development**: - Aiming to become a leader in the construction industry chain through EPC (Engineering, Procurement, and Construction) and prefabricated building systems [7][8] - Plans to build model houses in Shanghai to penetrate the residential market [8] Dividend Policy - Introduced a three-year dividend plan, increasing the payout ratio to **70%** with a minimum dividend of **400 million** CNY, targeting a dividend yield of at least **5%** [9] International Market Insights - The Middle East market is projected to have significant growth potential, with numerous projects expected to be tendered in the coming years [14] - The company has a history of successful projects in the region, including major constructions in Saudi Arabia and Qatar [13] Competitive Landscape - Key competitors in the Middle East include major steel structure companies from Vietnam and Turkey, as well as local firms in Saudi Arabia [29] - The company maintains a competitive edge due to lower steel prices and higher labor efficiency in China [29] Operational Efficiency - The company’s overseas projects primarily utilize domestic production from its **100,000-ton** export base in Shaoxing [26] - Focus on project management and technical expertise rather than merely increasing processing capacity [19] Future Outlook - The company aims to achieve **10 billion** CNY in overseas business within three years, with a projected growth of **70-80%** in 2026 [17] - Plans to explore further international expansion while maintaining a strong domestic presence [12][24] Additional Insights - The company is not currently considering establishing overseas factories due to cost advantages in China [26] - The use of robots for welding and rust removal is still in early stages, with limited impact on cost reduction [30] This summary encapsulates the key points from the conference call, highlighting the company's financial performance, strategic initiatives, and market positioning.

Group 1 - The report highlights that public funds in Q3 2025 have reached historical highs in their allocations to the electronics and communications sectors, with the electronics allocation increasing from 18.67% in Q2 to 25.53% in Q3, and the relative overweight ratio rising from +9.1% to +12.75% [2][22][26] - The report indicates that the electronics, communications, and power equipment sectors are the top three in terms of overweight ratios across all industries, while allocations to home appliances, food and beverages, and automobiles have decreased [2][26] - The report notes that among the top 500 companies held by funds, the number of companies in the electronics, power equipment, and pharmaceutical sectors has increased significantly, with respective increases of 63.64%, 72.73%, and 62.75% [2][26] Group 2 - The report states that the Shanghai Composite Index has broken the 4000-point mark for the first time in ten years, with significant market activity driven by net inflows from margin trading and southbound funds [3][27] - It mentions that the total supply of funds was 301 billion yuan, while demand was 605 billion yuan, resulting in a net outflow of 304 billion yuan, indicating a high level of market activity despite the outflow [3][28] - The report highlights that southbound funds have seen a net inflow of 572.77 billion yuan, a 279.07% increase compared to the previous period, reflecting continued optimism towards the Hong Kong stock market [3][30] Group 3 - The report on Aimei Ke indicates that the company experienced a revenue decline of 21.49% year-on-year in the first three quarters of 2025, with a total revenue of 18.65 billion yuan and a net profit of 10.93 billion yuan, down 31.05% [8][37] - It emphasizes the company's strong R&D capabilities and a rich pipeline, with several products in various stages of approval and clinical trials, which are expected to drive future growth [8][39] - The report also notes the acquisition of the Korean company REGEN, which is anticipated to enhance Aimei Ke's international market presence, particularly in the medical aesthetics sector [8][39] Group 4 - The report on Zhongmei Energy states that the company achieved a revenue of 361.48 billion yuan in Q3 2025, a year-on-year decline of 23.8%, but a quarter-on-quarter increase of 28.26% [17] - It highlights that the coal segment benefited from a rebound in coal prices, with the average selling price per ton reaching 474 yuan, higher than the previous half-year average [17][18] - The report maintains profit forecasts for 2025-2027, projecting net profits of 175 billion yuan, 177 billion yuan, and 182 billion yuan, respectively [17][18]

Investment Rating - The investment rating for the company is "Accumulate" (maintained) [2] Core Views - The company reported strong performance in Q3 with revenue of 14.557 billion yuan, a year-on-year increase of 20.85%, and a net profit of 590 million yuan, up 24.02% year-on-year [7][8] - The company has a future action plan to distribute at least 70% of the annual net profit in cash or a minimum of 400 million yuan (including tax) as dividends, which translates to a current dividend yield of 4.8%, indicating significant investment attractiveness [7][8] - The company has optimized its order structure with a notable increase in overseas contracts, which accounted for 27.8% of total orders in the first three quarters of 2025, up from 13.7% in 2024 [7][8] Financial Performance - For the first three quarters of 2025, the company achieved steel structure sales of 1.18 million tons, a year-on-year increase of 34.6% [7][8] - The company’s revenue projections for 2025-2027 are 23.836 billion yuan, 28.335 billion yuan, and 32.490 billion yuan, respectively, with net profits expected to be 640 million yuan, 733 million yuan, and 838 million yuan [6][8] - The company’s PE ratios based on the closing price on October 28 are projected to be 13.0, 11.3, and 9.9 for 2025, 2026, and 2027, respectively [6][8] Cash Flow and Profitability - The operating cash flow for the first three quarters was 761 million yuan, an increase of 533 million yuan year-on-year, with a cash collection ratio of 112.06% [8] - The gross profit margin for the first three quarters was 11.52%, a decrease of 1.54 percentage points year-on-year, while the net profit margin was 4.05%, showing a slight increase [8] Order and Market Expansion - The company signed new contracts worth 17.6 billion yuan in EPC and 11.4 billion yuan in prefabricated/industrial chain and strategic franchise/BIPV businesses, with significant growth in the latter two areas [7][8] - The overseas business has expanded into six major regional markets, effectively mitigating the impact of intense competition in the domestic construction market [7][8]

Investment Rating - The investment rating for the company is "Buy" with a target price not specified [6] Core Views - The company has shown steady growth in revenue and performance, with a focus on high dividend attributes. For the first three quarters of 2025, the company achieved operating revenue of 14.56 billion, a year-on-year increase of 20.85%. The net profit attributable to the parent company was 590 million, reflecting a year-on-year growth of 24% [1][2] - The company has committed to a shareholder return plan for 2025-2027, promising to distribute at least 70% of the annual net profit or a minimum of 400 million in cash dividends, whichever is higher [1] - The company’s cash dividend yield for 2025 is projected to be 5.3%, highlighting its strong dividend characteristics [1] Revenue and Orders - In the first three quarters of 2025, the company sold 1.18 million tons of steel structures, a year-on-year increase of 34.6%. New orders signed amounted to 17.98 billion, a year-on-year increase of 4.8%, with international orders growing significantly by 87.3% [2][3] - The domestic EPC business has shown steady growth, while the overseas business is expanding rapidly, contributing to the overall improvement in operational quality [3] Profitability and Cash Flow - The comprehensive gross margin for the first three quarters of 2025 was 11.5%, with a net profit margin of 4.05%, reflecting a slight year-on-year improvement [4] - The company reported a significant increase in operating cash flow, with a net inflow of 760 million, up by 530 million year-on-year, indicating enhanced cash collection capabilities [4] Financial Data and Valuation - The company’s projected net profit for 2025 is 630.77 million, with a corresponding P/E ratio of 13.19. The projected revenue for 2025 is 21.57 billion, with a growth rate of 16.65% [5][10] - The company’s total assets are expected to reach 27.42 billion by 2025, with a debt-to-asset ratio of 65.56% [11]

Core Insights - The report highlights concerns regarding the independence of the Federal Reserve, particularly in light of political pressures, which may impact the macroeconomic narrative and the valuation of the US dollar [2] - The report provides a detailed analysis of various companies, focusing on their financial performance and strategic initiatives [3][4][5][6][7][8][10][11][12][17][19][20][22][24][25][26][27][28][30][31] Company Summaries - **Lihigh Food (300973 CH, Buy)**: The company reported revenue of 3.14 billion and net profit of 250 million for the first three quarters of 2025, showing year-on-year growth of 15.7% and 22.0% respectively. Despite pressure on gross margins due to rising palm oil prices, effective cost control has helped maintain profitability [3] - **Red Flag Chain (002697 CH, Accumulate)**: The company achieved revenue of 7.11 billion in the first three quarters of 2025, a year-on-year decrease of 8.5%. The net profit was 383 million, down 1.9% year-on-year. The company is focusing on internal management and cost reduction to improve profitability [4] - **Kanglong Chemical (300759 CH, Buy)**: The company reported revenue of 10.086 billion and adjusted net profit of 1.227 billion for the first three quarters of 2025, reflecting year-on-year growth of 14.4% and 10.8% respectively. The company has raised its revenue growth guidance for 2025 from 10-15% to 12-16% [5] - **Zhou Dasheng (002867 CH, Buy)**: The company reported revenue of 6.772 billion for the first three quarters of 2025, a decline of 37.3% year-on-year, while net profit increased by 3.1%. The growth in net profit is attributed to a higher proportion of high-margin products [6] - **Aimeike (300896 CH, Buy)**: The company reported revenue of 566 million in Q3 2025, down 21.3% year-on-year, with a net profit of 304 million, down 34.6%. The company is focusing on expanding its product pipeline and international market presence [7] - **Leixin Technology (688018 CH, Accumulate)**: The company achieved revenue of 1.912 billion in the first three quarters of 2025, a year-on-year increase of 30.97%. Despite a slight decline in Q3 revenue, the company is expanding its market presence in high-performance SoC [8] - **Zhongke Chuangda (300496 CH, Buy)**: The company reported revenue of 5.148 billion for the first three quarters of 2025, reflecting a year-on-year increase of 39.34%. The growth is driven by the AIOT sector [9] - **Yihua (301029 CH, Buy)**: The company reported revenue of 736 million in Q3 2025, up 17.52% year-on-year, with a net profit of 136 million, up 28.59%. The growth is attributed to the continued demand in lithium battery and automotive sectors [10] - **Huazhi Technology (688281 CH, Buy)**: The company reported revenue of 285 million in Q3 2025, a year-on-year increase of 12.85%. The company is focusing on its leading position in stealth materials [11] - **Chengdu Bank (601838 CH, Buy)**: The bank reported a net profit of 5.0% and revenue growth of 3.0% for the first nine months of 2025, indicating stable performance despite non-interest income fluctuations [12] - **Yun Tianhua (600096 CH, Buy)**: The company reported revenue of 12.6 billion in Q3 2025, a year-on-year decrease of 14%, but net profit increased by 24%. The company benefits from strong export demand for phosphate products [13] - **Funi Co., Ltd. (600483 CH, Buy)**: The company reported revenue of 3.666 billion in Q3 2025, down 4.04% year-on-year, but net profit increased by 11.53%. The company is focusing on its project reserves and renewable energy contributions [14] - **Hongcheng Environment (600461 CH, Buy)**: The company reported revenue of 1.738 billion in Q3 2025, up 2.41% year-on-year, with net profit of 324 million, reflecting stable operational performance [15] - **Op Lighting (603515 CH, Accumulate)**: The company reported revenue of 1.692 billion in Q3 2025, down 0.59% year-on-year, with net profit of 208 million, down 12.22%. The company is expected to recover as the housing market stabilizes [16] Industry Insights - The macroeconomic environment is influenced by political pressures on the Federal Reserve, which may affect market confidence and asset valuations [2] - The food and beverage sector is experiencing mixed performance, with some companies managing to maintain profitability through cost control and strategic initiatives [3][4][5][6] - The healthcare and pharmaceutical sectors are showing resilience, with companies reporting steady revenue growth and improved cash flow [7][8][9] - The technology sector, particularly in AI and IoT, is witnessing significant growth, driven by increased demand for advanced solutions [10][11][12] - The banking sector is showing stable performance, with banks managing to maintain profitability despite fluctuations in non-interest income [13][14] - The energy sector is focusing on renewable energy projects, with companies looking to expand their project reserves and improve operational efficiency [15][16]

Core Insights - The company reported a total operating revenue of 14.557 billion yuan for the first three quarters of 2025, representing a year-on-year increase of 20.85% [1] - The net profit attributable to shareholders of the parent company reached 590 million yuan, reflecting a year-on-year growth of 24.02% [1] - The basic earnings per share stood at 0.2949 yuan [1]

Financial Performance - The company's operating revenue for the third quarter reached CNY 4,646,697,589.39, representing a year-on-year increase of 5.80%[4] - The total profit for the period was CNY 269,065,747.03, reflecting an increase of 11.33% compared to the previous year[4] - The net profit attributable to shareholders was CNY 240,022,485.37, which is an 18.57% increase year-on-year[4] - Total operating revenue for the first three quarters of 2025 reached ¥14.56 billion, a 21% increase from ¥12.05 billion in the same period of 2024[18] - Operating profit for the first three quarters of 2025 was ¥661.11 million, up 24% from ¥533.02 million in the first three quarters of 2024[18] - Net profit attributable to shareholders of the parent company for the first three quarters of 2025 was ¥589.72 million, representing a 24% increase compared to ¥475.50 million in the same period of 2024[20] - The total comprehensive income for the first three quarters of 2025 was ¥577.07 million, compared to ¥512.27 million in the same period of 2024[20] Earnings and Shares - The basic earnings per share for the quarter were CNY 0.1180, up 16.03% from the same period last year[6] - The diluted earnings per share were CNY 0.1075, reflecting a 16.72% increase year-on-year[6] - Earnings per share for the first three quarters of 2025 were ¥0.2949, up from ¥0.2389 in the same period of 2024[20] Cash Flow - The cash flow from operating activities showed a significant increase of 233.31%, amounting to CNY 760,826,548.78[6][9] - The company reported a net cash flow from operating activities of ¥760.83 million for the first three quarters of 2025, significantly up from ¥228.27 million in the same period of 2024[22] - The net cash flow from investing activities was -712,071,743.28, indicating a significant outflow compared to the previous period's -134,787,425.88[23] - Total cash inflow from financing activities amounted to 1,285,012,386.19, while cash outflow was 1,711,423,710.21, resulting in a net cash flow of -426,411,324.02[23] - The ending balance of cash and cash equivalents was 1,461,019,631.24, down from 1,837,744,175.83 at the beginning of the period[23] - Cash received from borrowings was 1,285,012,386.19, reflecting the company's reliance on debt financing during the period[23] Assets and Liabilities - The total assets at the end of the period were CNY 26,629,510,319.53, a 3.97% increase from the end of the previous year[6] - The company's current assets totaled CNY 22,488,882,845.82, up from CNY 21,326,863,734.55, indicating an increase of about 5.45%[14] - The company's total liabilities reached CNY 17,246,461,158.35, compared to CNY 16,639,584,333.00, marking an increase of about 3.66%[16] - The total equity attributable to shareholders rose to CNY 9,355,660,741.60 from CNY 8,941,482,793.90, which is an increase of approximately 4.63%[16] Investments and Expenses - Research and development expenses for the first three quarters of 2025 amounted to ¥509.19 million, a 5% increase from ¥486.07 million in the same period of 2024[18] - The company reported an increase in investment income to ¥21.02 million in the first three quarters of 2025, compared to ¥9.83 million in the same period of 2024[18] - The company reported a total cash outflow from investing activities of 1,338,865,125.79, which is a substantial increase from the previous period[23] Shareholder Information - The company has not reported any significant changes in shareholder participation in margin financing and securities lending activities[12] - The company distributed dividends and interest payments totaling 214,867,737.69, which is an increase compared to the previous period[23] Other Information - The company reported non-recurring gains of CNY 50,210,633.23 for the period[8] - The weighted average return on equity was 2.60%, an increase of 0.29 percentage points from the previous year[6] - The company plans to continue expanding its market presence and investing in new technologies to drive future growth[19] - The impact of exchange rate changes on cash and cash equivalents was a positive 931,973.93, contrasting with a negative impact of -3,463,113.40 in the previous period[23] - The company did not apply new accounting standards starting from 2025, indicating stability in financial reporting practices[24]

Core Insights - The company reported a revenue of 4.647 billion yuan for Q3 2025, representing a year-on-year growth of 5.80% [1] - The net profit attributable to shareholders for Q3 2025 was 240 million yuan, showing an increase of 18.57% year-on-year [1] - Basic earnings per share for Q3 2025 stood at 0.118 yuan [1] Financial Performance - For the first three quarters of 2025, the company achieved a total revenue of 14.557 billion yuan, which is a year-on-year increase of 20.85% [1] - The net profit attributable to shareholders for the first three quarters was 590 million yuan, reflecting a year-on-year growth of 24.02% [1] - Basic earnings per share for the first three quarters were reported at 0.2949 yuan [1]

Group 1 - The company will hold its third extraordinary general meeting of shareholders on November 10, 2025 [2][6] - The meeting will utilize a combination of on-site and online voting methods [2][3] - The online voting will be conducted through the Shanghai Stock Exchange's system, available from 9:15 AM to 3:00 PM on the day of the meeting [3][4] Group 2 - The company has successfully signed a subcontract for the Saudi Qiddiya Cultural and Arts Center project, with a contract value of 649.43 million Saudi Riyals (approximately 1.23 billion RMB), accounting for 6.7% of the company's latest audited revenue [21][22] - This project is part of Saudi Arabia's Vision 2030 and aims to create a landmark venue for performing arts [22][26] - The project is expected to positively impact the company's future performance and reflects the recognition of the "Jinggong International" brand in the Saudi market [21][27] Group 3 - The company plans to provide financing guarantees for its controlled enterprises, including Jinggong Industrial Building System Group Co., Ltd., Zhejiang Jinggong Steel Structure Group Co., Ltd., and Jinggong International Steel Structure Co., Ltd. [38][39] - The total amount of external financing guarantees provided by the company and its subsidiaries is 611.79 million RMB, which accounts for 68.42% of the company's latest audited equity attributable to shareholders [43]

Core Viewpoint - Jinggong Steel Structure has signed a subcontract for the Qiddiya Cultural and Arts Center project in Saudi Arabia, valued at 650 million Saudi Riyals, approximately 1.23 billion RMB, marking a significant breakthrough in the Middle East market for the company [2] Group 1: Project and Financial Performance - The Qiddiya project is expected to become an important cultural landmark in Saudi Arabia and positively impact the company's future performance [2] - From January to September, the company signed 533 new contracts with a total value of 17.98 billion RMB, a year-on-year increase of 4.8% [2] - Steel structure sales reached 1.18 million tons, reflecting a year-on-year growth of 34.6% [2] Group 2: Overseas Business Growth - The company reported new overseas orders worth 5 billion RMB from January to September, a significant year-on-year increase of 87.3% [2] - Cumulative new orders for overseas business have already surpassed the total expected for the entire year of 2024 [2] - The overseas market serves as a crucial extension of the domestic market, helping to mitigate the impact of intense competition in the domestic construction sector while ensuring profitability and payment conditions for orders [2] Group 3: Financial Results - For the first half of the year, the company achieved operating revenue of 9.911 billion RMB, a year-on-year increase of 29.48% [2] - The net profit attributable to shareholders reached 350 million RMB, up 28.06% year-on-year [2] - The net profit excluding non-recurring items was 302 million RMB, reflecting a year-on-year growth of 22.75% [2]