Core Viewpoint - The three major telecom operators in China reported a year-on-year net profit growth of over 5% for the first half of 2025, despite stable revenue levels, leading to media headlines emphasizing their profitability. However, the decline in free cash flow raises concerns about their actual cash-generating capabilities [1][9]. Group 1: Financial Performance - The telecom operators' free cash flow has shown a downward trend over the past three years, with China Mobile reporting a free cash flow of 25.5 billion, a 62% decrease year-on-year, while China Telecom and China Unicom also experienced significant declines compared to 2023 [6][8]. - Despite the net profit growth, the decline in free cash flow indicates a weakening ability to distribute dividends or reinvest, reflecting the true financial health of these operators [9]. Group 2: Capital Expenditure Trends - Following a peak in 5G investments from 2020 to 2023, the three operators have begun to reduce capital expenditures, with China Mobile, China Telecom, and China Unicom decreasing their capital expenditures by 9%, 28%, and 15% respectively in the first half of 2025 [12]. - The reduction in capital expenditures positively impacted free cash flow for China Telecom and China Unicom, which saw slight increases in free cash flow due to this decrease [12]. Group 3: Operating Cash Flow Analysis - The operating cash flow for the three operators declined significantly, with China Mobile's operating cash flow net amount halving compared to the same period in 2023, while China Telecom and China Unicom also reported decreases of 19% and 3% respectively [14]. - The primary reasons for the decline in operating cash flow include increased payments to suppliers and a rise in accounts receivable due to slower collection from government enterprise projects [16][21]. Group 4: Accounts Receivable and Bad Debt Provisions - Accounts receivable for the three operators increased significantly, with China Mobile, China Telecom, and China Unicom reporting year-on-year increases of 25%, 26%, and 19% respectively [22]. - The rise in accounts receivable has led to a substantial increase in bad debt provisions, with China Mobile and China Telecom seeing provisions grow by 33% and 59% respectively in 2025 [28][30]. Group 5: Strategic Implications - The operators need to shift focus from merely increasing revenue to ensuring cash flow generation, particularly in the government enterprise market, to avoid a cycle of "paper profits" without actual cash [36]. - A return to high-quality development is essential for the operators to maintain competitiveness and ensure that enterprise business becomes a growth engine rather than a cash drain [35][36].

Company Performance - Longsoft Technology reported a net profit of 33.03 million yuan for 2024, a year-on-year decline of 60.83% due to decreased coal industry prosperity [2][4] - The company's operating revenue for 2024 was 329 million yuan, down 17.04% year-on-year, with smart mining industrial software contributing 84.21% of total revenue [3][4] - In Q4 2024, the company achieved operating revenue of 114 million yuan, a year-on-year decrease of 20.93%, and reported a net loss of 16.02 million yuan [3] Dividend Announcement - Longsoft Technology announced a cash dividend of 0.136 yuan per share, with the record date set for June 16, 2025, and the payment date on June 17, 2025 [1][4] - The total cash dividend distribution amounts to approximately 9.91 million yuan based on the total share capital of 72,893,000 shares [1] Accounts Receivable - The accounts receivable balance for the company was 397 million yuan in 2022, 507 million yuan in 2023, and 506 million yuan in 2024, representing 49.69%, 56.21%, and 53.83% of total assets respectively [3] - The company recognized bad debt provisions of 28.24 million yuan during the reporting period, with an ending balance of 127 million yuan [3] Tax Matters - For individual shareholders holding unrestricted shares for over one year, dividend income is exempt from personal income tax; for those holding less than one year, tax is deferred until the stock is sold [2] - The company has withheld a 10% tax on cash dividends for certain investors, including QFIIs and Hong Kong market investors [2]

Core Viewpoint - The company, Jiangjian Co., Ltd. (交建股份), reported a stock price of 7.16 yuan as of June 6, 2025, with a 1.42% increase and a trading volume of 94,600 shares, amounting to a transaction value of 67.32 million yuan [1]. Trading Information Summary - On June 6, 2025, the net inflow of main funds was 4.62 million yuan, while retail investors experienced a net outflow of 5.11 million yuan [2][3]. Company Announcement Summary - Jiangjian Co., Ltd. responded to the Shanghai Stock Exchange's inquiry regarding its 2024 annual report, confirming that the accounting firm, Rongcheng, conducted a review and provided an opinion on the disclosed information [3]. - As of the end of 2024, the balance of receivables and contract assets from related parties was 799.88 million yuan, accounting for 13.44% of the total balance [3][4]. Performance Commitment - The revenue from related parties for the years 2021 to 2023 was 868.09 million yuan, 669.70 million yuan, and 468.19 million yuan, representing 95.07%, 82.57%, and 50.23% of total revenue, respectively [4]. - The net profit during the performance commitment period from 2021 to 2023 was 40.68 million yuan, 34.48 million yuan, and 60.53 million yuan, achieving a cumulative completion rate of 113% [4]. Financial Overview - In 2024, Jiangjian Co., Ltd. achieved an operating income of 691.37 million yuan and a net profit of 14.57 million yuan, with related sales revenue decreasing to 212.32 million yuan [4]. - The company reported a cash balance of 849.41 million yuan and total borrowings of 1.59 billion yuan, primarily used for PPP projects and operational funding [6]. - The net cash flow from operating activities was -193 million yuan, with 137 million yuan paid for other operating-related cash flows [6].