YONGYUE(SH:603879) Zheng Quan Zhi Xing·2025-08-30 23:24Core Viewpoint - Yongyue Technology (603879) reported a decline in total revenue for the first half of 2025, but showed improvement in profitability metrics, indicating a mixed financial performance [1] Financial Performance Summary - Total revenue for the first half of 2025 was 149 million yuan, a decrease of 6.16% year-on-year [1] - Net profit attributable to shareholders was -6.17 million yuan, an increase of 75.24% year-on-year [1] - Gross margin improved to 9.06%, up 40.73% year-on-year, while net margin was -4.14%, up 73.63% year-on-year [1] - Total expenses (selling, administrative, and financial) amounted to 17.99 million yuan, accounting for 12.08% of revenue, a decrease of 48.38% year-on-year [1] - Earnings per share were -0.02 yuan, an increase of 75.47% year-on-year [1] Cash Flow and Balance Sheet Changes - Cash and cash equivalents decreased by 64.36% due to daily operational expenditures [3] - Short-term borrowings decreased by 85.29% as a result of repayment [5] - Contract liabilities increased by 439.15% due to an increase in advance payments [5] - Operating cash flow improved by 45.15% due to reduced daily operational expenses [5] Historical Performance and Investment Return - The company's historical return on invested capital (ROIC) has been generally low, with a median of 6.74% since its listing, and a particularly poor ROIC of -44.72% in 2024 [6] - The company has reported losses in three out of seven annual reports since its listing, indicating a fragile business model [6] Recommendations and Observations - Attention is advised on the company's cash flow situation, with cash and cash equivalents to current liabilities ratio at 56.88% [7] - Financial expenses have been a concern, with negative net cash flow from operating activities over the past three years [7]