LANZHOU HUANGHE(SZ:000929) Zheng Quan Zhi Xing·2025-08-26 22:39Core Viewpoint - *ST Lanhuang (000929) reported a significant decline in net profit and revenue for the first half of 2025, indicating ongoing financial struggles and operational challenges [1][3]. Financial Performance Summary - The total operating revenue for the first half of 2025 was 96.83 million yuan, a decrease of 15.81% compared to the previous year [1]. - The net profit attributable to shareholders was -11.91 million yuan, reflecting a year-on-year decline of 45.29% [1]. - In Q2 2025, the operating revenue was 49.16 million yuan, down 19.63% year-on-year, with a net profit of -19.14 million yuan, a staggering decline of 161.09% [1]. Key Financial Metrics - Gross margin stood at 13.94%, showing a slight increase of 0.72% year-on-year, while the net margin dropped to -24.76%, a decrease of 35.92% [1]. - Total expenses (selling, administrative, and financial) amounted to 31.67 million yuan, accounting for 32.7% of revenue, an increase of 14.43% year-on-year [1]. - Earnings per share were -0.06 yuan, down 45.58% from the previous year, and the net asset per share decreased by 18.77% to 2.53 yuan [1]. Cash Flow and Debt Analysis - The net cash flow from operating activities was significantly negative, with a change of -303.81%, primarily due to decreased cash inflows from sales [3]. - The company reported a 95.09% decrease in interest-bearing debt, indicating a reduction in financial leverage [1]. - The cash and cash equivalents decreased by 24.58% year-on-year, reflecting liquidity challenges [1]. Historical Performance Insights - The company's historical return on invested capital (ROIC) has been poor, with a median of -4.74% over the past decade, and the worst year being 2024 with an ROIC of -18.73% [4]. - The company has reported losses in 9 out of 25 annual reports since its listing, suggesting a trend of underperformance [4]. Recommendations for Monitoring - Attention is advised on the company's cash flow situation, as the average operating cash flow over the past three years is -24.08% of current liabilities [4]. - Monitoring of financial expenses is crucial, as they have reached 57.93% of the average operating cash flow over the past three years [4]. - The status of accounts receivable should be closely observed, given the negative net profit reported in annual reports [4].