LOPAL(SH:603906) Zheng Quan Zhi Xing·2025-08-21 22:33Core Viewpoint - Longpan Technology (603906) reported a slight increase in total revenue for the first half of 2025, but continued to face net losses, although the loss amount decreased significantly compared to the previous year [1]. Financial Performance - Total revenue for the first half of 2025 reached 3.622 billion yuan, a year-on-year increase of 1.49% [1]. - The net profit attributable to shareholders was -85.1534 million yuan, showing a year-on-year improvement of 61.7% [1]. - In Q2 2025, total revenue was 2.03 billion yuan, down 3.08% year-on-year, while the net profit attributable to shareholders was -59.2046 million yuan, an increase of 58.81% year-on-year [1]. - Gross margin improved to 13.84%, up 36.23% year-on-year, while net margin improved to -3.04%, up 59.09% year-on-year [1]. Cost and Expenses - Total selling, administrative, and financial expenses amounted to 376 million yuan, accounting for 10.37% of revenue, a decrease of 2.99% year-on-year [1]. - Selling expenses decreased by 13.71% due to lower business promotion costs [10]. - Management expenses slightly increased by 0.09% due to higher employee compensation [10]. - Financial expenses increased by 4.25% due to higher bill discounting costs [10]. Cash Flow and Assets - Cash flow from operating activities showed a significant decline of 90.32%, attributed to reduced cash received from sales of goods and services [15]. - Cash and cash equivalents increased by 34.94% to 3.203 billion yuan [1]. - The company’s net asset per share decreased by 15.81% to 4.53 yuan [1]. Liabilities and Debt - Interest-bearing liabilities rose by 6.90% to 9.576 billion yuan [1]. - The company’s debt-to-asset ratio reached 52.89%, indicating a high level of leverage [21]. Investment and Returns - The company’s return on invested capital (ROIC) has been historically low, with a median ROIC of 11.26% since its listing, and a particularly poor ROIC of -10.32% in 2023 [18]. - Investment income surged by 712.35% due to increased returns from financial products [12]. Business Model and Strategy - The company’s performance is primarily driven by research and development, necessitating a thorough examination of the underlying drivers of this strategy [20]. - The business model has shown signs of weakness, with two years of losses since its listing [18].