Core Viewpoint - The company reported a significant decline in revenue and net profit for the first half of 2025, primarily due to weak coking coal prices and trade volumes, but maintains a positive outlook on its transformation and future profitability potential [1][2][4]. Financial Performance - In H1 2025, the company's revenue was 6.7 billion yuan, down 35% year-over-year (yoy), with a net profit attributable to shareholders of 310 million yuan, down 43% yoy [1]. - For Q2 2025, revenue, net profit, and net profit excluding non-recurring items were 3.1 billion yuan, 130 million yuan, and 130 million yuan, respectively, reflecting yoy declines of 43%, 52%, and 51% [1]. Revenue Breakdown - The company's coking coal sales volume in H1 2025 was 2.22 million tons, compared to 3.16 million tons in H1 2024, indicating a significant decrease [2]. - Revenue from engineering, resource equipment supply chain, and power operations in H1 2025 decreased by 25%, 51%, and increased by 55% to 3.1 billion yuan, 2.66 billion yuan, and 330 million yuan, respectively [2]. - The increase in power operations revenue is attributed to better performance from the Croatia wind power project, with generation volumes increasing by 21% yoy [2]. Profitability Metrics - The company's overall gross margin improved by 3.1 percentage points to 13.1% in H1 2025, with specific margins for engineering, resource equipment supply chain, and power operations at 17.4%, 0.7%, and 70.5%, respectively [3]. - The increase in gross margin is linked to changes in revenue structure and improved profitability of certain projects, such as the Croatia wind power project [3]. - However, the net profit margin decreased by 0.6 percentage points to 4.6% in H1 2025 due to rising fixed costs and reduced foreign exchange contributions [3]. Future Outlook - The company expects revenues of 20.8 billion yuan, 22.7 billion yuan, and 24.7 billion yuan for 2025, 2026, and 2027, respectively, with a consistent growth rate of 9% yoy [4]. - Net profits are projected to be 1.2 billion yuan, 1.3 billion yuan, and 1.41 billion yuan for the same years, reflecting growth rates of 14%, 9%, and 8% yoy [4]. - The company is advancing its integrated investment and operation model, with key projects in Mongolia and Croatia serving as benchmarks for its transformation [4]. - Recent improvements in coking coal prices since H2 2025 may provide better profit elasticity, supporting a "buy" rating with a projected PE of 10x for 2025 [4].

Investment Rating - The investment rating for the company is "Buy" with a target price not specified [5] Core Views - The company faced operational pressure in H1 2025 due to declining coking coal prices, but the focus on the coking coal business's elasticity is emphasized under the anti-involution policy [1] - The company achieved revenue of 6.735 billion in H1 2025, a year-on-year decrease of 35.34%, and a net profit attributable to the parent company of 309 million, down 42.71% [1] - The company is expected to benefit from the operational performance of ongoing projects, particularly the Bangladesh coal-fired power plant, which is anticipated to start contributing operational revenue this year [1] - The overall coking coal prices have shown signs of recovery since Q3, which is expected to enhance profit elasticity in the company's coking coal business [1] - The company maintains a positive outlook on its integrated investment and operation business development prospects, forecasting net profits attributable to the parent company of 1.12 billion, 1.24 billion, and 1.4 billion for 2025-2027 [1] Financial Performance Summary - In H1 2025, the revenue from various business segments was as follows: Engineering Construction and Services 3.1 billion, Resource Equipment Supply Chain 2.66 billion, Power Operations 330 million, and Industrial Manufacturing 620 million, with respective year-on-year changes of -24.9%, -50.9%, +55.2%, and -0.9% [2] - The overall gross margin for H1 2025 was 13.09%, an increase of 3 percentage points year-on-year, with Q2 gross margin at 13.15%, up 2.63 percentage points [2] - The company signed new contracts worth 402 million USD in H1 2025, a decrease of 44.76% year-on-year, while efforts to explore emerging markets have yielded breakthroughs in Egypt and the UAE [2] - The company's cash flow from operations (CFO) improved to 147 million in H1 2025, an increase of 531 million year-on-year, primarily due to a reduction in the maturity of large acceptance bills compared to the previous year [3] Financial Data and Valuation - The projected financial data for the company from 2023 to 2027 includes revenue growth rates of 59.96% in 2023, -11.21% in 2024, and positive growth in subsequent years [4] - The estimated net profit attributable to the parent company is forecasted to be 918.06 million in 2023, increasing to 1.399 billion by 2027, with corresponding growth rates of 44.35%, 14.32%, and 12.97% [4] - The company's price-to-earnings (P/E) ratio is projected to decrease from 14.30 in 2023 to 9.38 in 2027, indicating an improving valuation over time [4]

Core Insights - The visit to Shanghai and Zhejiang aimed to explore cooperation opportunities and discuss key projects in various industries [1] Group 1: Industry Engagement - The delegation visited leading companies in low-altitude economy and food research and production sectors, assessing their R&D achievements, innovative technologies, and supply chain layouts [1] - In Zhejiang, the delegation engaged with a well-known real estate development management company to learn about their integrated investment and construction model for future communities [1] - The visit to Qiandao Lake Water Economy Industrial Park focused on projects related to water beverages, health tourism, and the integration of water resources, aiming to gather insights for the development of the water economy in the new district [1] Group 2: Economic Potential and Collaboration - The new district boasts unique advantages in location, transportation, industrial foundation, and business environment, indicating significant economic development potential [1] - Business leaders expressed high appreciation for the district's industrial development and business environment, indicating a willingness to strengthen communication and arrange follow-up visits for collaborative projects [1]

Core Viewpoint - The document outlines the underwriting proposal for the issuance of A-shares by NORINCO International Cooperation Ltd., detailing the company's business operations, financial data, and the specifics of the share issuance process [1][17]. Group 1: Company Overview - NORINCO International was established in May 1986 and is headquartered in Beijing, with a registered capital of 1,071,385,874 yuan [1]. - The company operates in various sectors including engineering construction, international trade, and resource supply chain management, focusing on international markets [3][4]. Group 2: Main Business Activities - The core business of the company is engineering construction and services, with capabilities in project financing, design, procurement, construction, and logistics [3]. - The company has established significant international projects, particularly in regions such as Asia, Africa, and the Middle East, aligning with the Belt and Road Initiative [4]. Group 3: Financial Data - As of March 31, 2025, the total assets of the company amounted to 2,499,380,000 yuan, with total liabilities of 1,430,471,710 yuan, resulting in total equity of 1,068,908,300 yuan [5]. - The company reported total operating revenue of 364,962,260 yuan for the first quarter of 2025, with a net profit of 17,997,590 yuan [7]. Group 4: Share Issuance Details - The company plans to issue A-shares to specific investors, with a total fundraising target of up to 96,000,000 yuan [22]. - The issuance will be conducted in compliance with relevant laws and regulations, with a maximum of 105,032,822 shares to be issued [20][21]. Group 5: Risk Factors - The company faces various risks including macroeconomic fluctuations, market competition, and operational risks related to contract execution and project management [10][11]. - Financial risks include potential difficulties in obtaining financing and managing cash flow, particularly in light of high capital expenditures associated with its projects [12][13].

Core Viewpoint - CITIC Securities Co., Ltd. acts as the sponsor for NORINCO International Cooperation Ltd.'s issuance of A-shares to specific investors in 2024, ensuring compliance with relevant laws and regulations [1][2][19]. Group 1: Issuer Information - NORINCO International was established on April 5, 1986, and is listed on the Shenzhen Stock Exchange under the stock code 000065.SZ with a registered capital of 1,071,385,874 RMB [5][9]. - The company specializes in international engineering construction and services, focusing on sectors such as rail transportation, power, and mineral facilities [6][7]. Group 2: Financial Data - As of March 31, 2025, the total assets of NORINCO International amounted to 2,499,380,000 RMB, with total liabilities of 1,430,471,710 RMB, resulting in total equity of 1,068,908,300 RMB [9]. - The company reported total revenue of 1,907,992,540 RMB for the year 2024, with total costs of 1,746,831,590 RMB, leading to an operating profit of 115,692,320 RMB [9][12]. Group 3: Shareholding Structure - As of March 31, 2025, the largest shareholder, China North Industries Group Corporation, holds 40.37% of the shares, while North Industries Technology Co., Ltd. holds 11.72%, making them the controlling shareholders [9][10]. - The total number of shares is 1,069,806,922, with 90.99% being freely tradable [8][9]. Group 4: Project Team - The project team for the A-share issuance includes representatives Zhao Fan and Huang Kai as the main sponsors, with Cheng Cuiwei as the project coordinator and other team members [3][4]. Group 5: Regulatory Compliance - CITIC Securities has conducted due diligence and confirmed that NORINCO International meets the legal requirements for the issuance of A-shares, ensuring that all necessary approvals have been obtained [19][21][22]. - The issuance plan has been approved by the company's board and shareholders, and it complies with the relevant regulations set forth by the China Securities Regulatory Commission [20][21].

Summary of Northern International's Conference Call Company Overview - Northern International has improved its ranking to 66th among the top 250 contractors, indicating enhanced industry status [2][3] - The company adopts an integrated investment, construction, and operation strategy, diversifying its business into goods trade, engineering construction and services, metal packaging containers, and power generation [2][3] Financial Performance - In 2024, revenue contributions from various segments are as follows: goods trade (44%), engineering construction and services (37%), metal packaging containers (2%), and power generation (3%) [4] - Gross profit contributions are: goods trade (44%), engineering construction and services (37%), metal packaging containers (7%), and power generation (11%), with a significant increase in gross profit from goods trade [4] - Cash flow remains strong, with net inflow levels between 650 million to 740 million from 2022 to 2024, although net inflow decreased by 50 million year-on-year in 2024 [5][4] - Total cash dividends for 2024 amount to 160 million, with a dividend payout ratio of 25% [5] Coal Trade Impact - Mongolian coal trade is a crucial revenue source for Northern International, with a 14% year-on-year increase in export volume to 78 million tons in 2024 [2][6] - The company has initiated comprehensive projects in Mongolia, including a 370 million USD heavy-load road project, which is expected to significantly boost coal export volumes [6] - The acquisition of a 60% stake in Inner Mongolia Mandula Mining facilitates the integration of Mongolian coal trade [6] Power Operations Progress - Northern International is transitioning towards an integrated investment and operation model, with multiple power projects in countries along the Belt and Road Initiative [7] - Key projects include: - Laos Sanbai Hydropower (investment of 210 million USD, stable revenue) - Croatia Saini Wind Power (revenue decreased in 2024 due to lower electricity prices) - Bangladesh Rocket Project (expected to commence operations in the first half of 2024, with a total investment of 2.5 billion USD) - Bosnia Herzegovina Komanyesh Mountain Solar Project (investment started in 2024) [7][9] Future Profit Forecast - The engineering construction sector is expected to maintain steady growth, while trade business is projected to achieve higher growth rates [8] - Overall profit is anticipated to grow at around 10% annually, with a forecasted growth rate of 4% for 2025 and over 15% for the following two years [8] - The current valuation is approximately 10 times earnings, making the company an attractive investment opportunity given the progress of the Belt and Road Initiative [8]

Core Viewpoint - North International has received approval from the State-owned Assets Supervision and Administration Commission for a non-public issuance of A-shares, aiming to raise up to 960 million yuan for the construction of a photovoltaic project in Bosnia and Herzegovina and to supplement working capital [1][2]. Group 1: Fundraising and Project Details - The company plans to issue no more than 105 million A-shares, with total fundraising not exceeding 960 million yuan, of which approximately 724 million yuan (75.45% of total funds) will be allocated to the 125MWp photovoltaic project in Bosnia [2][3]. - The project has a total investment of about 755 million yuan and is expected to be completed within 12 months [2]. Group 2: Business Transformation and Performance - North International is actively transforming its business model towards an integrated investment and construction operation, which has led to significant achievements in recent years [1][4]. - The company's revenue has grown from 1.66 billion yuan in 2012 to 19.08 billion yuan in 2024, while net profit increased from 120 million yuan to 1.05 billion yuan during the same period [4]. Group 3: Financial Health and Cost Management - The company's asset-liability ratio has decreased from 65.56% in 2020 to 57.23% in the first quarter of 2025, indicating improved financial health [5]. - In the first quarter of 2025, North International reported a revenue of 3.6496 billion yuan, a decrease of 27.22% year-on-year, but managed to reduce operating costs significantly, resulting in a gross profit margin of 13.03%, up from 9.62% in the previous year [5].

Investment Rating - The investment rating for the company is "Buy" with a target price not specified [6]. Core Views - The company is expected to continue its profit growth in 2024, with the Bangladesh project entering its operational phase in 2025, driving sustained revenue growth [1]. - In 2024, the company achieved a revenue of 19.08 billion, a year-on-year decrease of 11.21%, while the net profit attributable to the parent company was 1.05 billion, an increase of 14.32% year-on-year [1]. - The company has a strong order backlog, with contracts worth 63.9 billion USD (approximately 459.6 billion CNY) currently in execution, which is about 2.4 times the revenue for the period [2]. - The company’s comprehensive gross margin improved to 12.82% in 2024, up by 2.5 percentage points year-on-year, indicating enhanced profitability [3]. Financial Performance Summary - In 2024, the company reported a revenue of 190.8 billion CNY, with a net profit of 10.5 billion CNY, reflecting a 14.32% increase year-on-year [1]. - The company’s EBITDA for 2024 is projected at 1,964.89 million CNY, with a net profit attributable to the parent company expected to be 1,049.51 million CNY in 2024 [5]. - The company’s cash flow from operations (CFO) for 2024 is 653.35 million CNY, with a cash flow ratio of 104.61%, indicating improved cash management [3]. Business Segment Performance - Revenue from engineering construction and services, resource equipment supply chain, power operation, and industrial manufacturing in 2024 was 83.6 billion, 89.7 billion, 4.4 billion, and 12.4 billion CNY respectively, with notable declines in the first three segments [2]. - The Mongolian integrated mining project saw a 17.6% increase in mining volume, while coal sales decreased by 3.6% year-on-year [2]. - The Croatian wind power project generated 385 million kWh in 2024, a decrease of 16.3% year-on-year, primarily due to adverse weather conditions [2].