Xianhe(SH:603733) Xin Lang Cai Jing·2025-11-08 04:29Core Viewpoint - The company reported strong Q3 2025 performance with revenue of 3.07 billion yuan, a year-on-year increase of 15.5%, and a net profit attributable to shareholders of 304 million yuan, up 13.9% year-on-year, indicating robust operational stability and improved profitability driven by integrated operations in the pulp and paper sector [1][2]. Financial Performance - Q3 2025 revenue reached 3.07 billion yuan, with a year-on-year growth of 15.5% and a net profit of 304 million yuan, reflecting a 13.9% increase year-on-year [1]. - The company achieved a non-recurring net profit of 247 million yuan, which is a 1.5% increase year-on-year [1]. - Investment income from joint ventures and associates amounted to 52.29 million yuan in Q3 [1]. Production and Cost Analysis - The total production and sales volume for Q3 2025 was 38,000 tons, remaining stable quarter-on-quarter, with an average selling price of 7,241 yuan per ton, down 174 yuan from the previous quarter [2]. - The cost per ton was 6,062 yuan, a decrease of 367 yuan quarter-on-quarter, leading to a gross profit of 1,179 yuan per ton, which is an increase of 193 yuan quarter-on-quarter [2]. - The net profit per ton for the main business was 640 yuan, up 29 yuan quarter-on-quarter, while excluding contributions from the summer king, the net profit per ton was 500 yuan, an increase of 37 yuan quarter-on-quarter [2]. Profitability and Efficiency - The gross profit margin for Q3 2025 was 14.59%, stable year-on-year and up 1.77 percentage points quarter-on-quarter [3]. - The net profit margin was 9.88%, down 0.15 percentage points year-on-year but up 1.94 percentage points quarter-on-quarter [3]. - The operating cash flow for Q3 2025 was 590 million yuan, compared to 371 million yuan in the same period last year, indicating strong cash flow performance [4]. Strategic Positioning - The company is a leading player in the specialty paper sector, with a comprehensive production capacity exceeding 2 million tons annually across various locations in China [4]. - The integration of pulp and paper operations is expected to smooth out cyclical fluctuations and provide substantial growth momentum [4]. Investment Outlook - The company anticipates a recovery in pulp prices from Q3 to Q4, with expected revenue growth of 24%, 19%, and 18% for 2025, 2026, and 2027, respectively [5]. - Projected net profits for 2025, 2026, and 2027 are 1.108 billion, 1.389 billion, and 1.683 billion yuan, respectively, with corresponding EPS of 1.57, 1.97, and 2.38 yuan [5].