Summary of Roman Holdings Conference Call Company Overview - **Company**: Roman Holdings (罗曼股份) - **Industry**: Digital Entertainment, Power Computing, Landscape Lighting Key Points Financial Performance - In 2022, Roman Holdings experienced negative growth due to the pandemic and a decline in municipal construction, leading to a loss in 2024 attributed to decreased gross margins, increased management expenses, and impairment provisions [2][3] - The company achieved a compound annual growth rate (CAGR) of 39.5% in revenue from 2015 to 2021, with a net profit margin consistently above 15% [2][3] Strategic Acquisitions - Roman Holdings acquired UK-based Holovis in 2024 to enter the digital entertainment sector, aiming for rapid growth through this transformation [4] - The company plans to acquire Wutong Tree Technology, a computing service provider, to establish a foothold in the computing industry [6] Wutong Tree Technology - Wutong Tree Technology reported a revenue of 130 million yuan in the first half of 2025, with a gross margin of 25% and a net margin of 15%, outperforming peers [2][7] - The company has secured orders worth approximately 550 million yuan as of September 5, 2025, including a 3 billion yuan project in Wuhu and a 1.5 billion yuan cooperation framework with the local government [9][10] Technological Advantages - Wutong Tree Technology boasts four core competitive advantages: 1. Superior server performance using GP GPU technology [7] 2. Integrated services with 100% liquid cooling technology, significantly improving heat dissipation efficiency [8] 3. Strong financial performance with a gross margin of 25% and net margin of 15% [7] 4. Early entry into the education sector, leveraging resources from university incubators [7] Industry Outlook - The computing industry in Wuhu is expected to grow significantly, with local government support and partnerships with major telecom companies [11] - The AI industry in China is projected to reach 352.2 billion yuan by 2025, with Wutong Tree positioned to benefit from this growth [6] Synergies and Future Growth - The acquisition of Holovis is expected to enhance Roman Holdings' immersive experience design business, benefiting from the rising demand for offline experience stores [13][14] - Holovis aims for revenues of over 50 million pounds in FY2025 and 60 million pounds in FY2026, with net profits projected between 3 to 4 million pounds [15] Traditional Business Prospects - Roman Holdings' traditional landscape lighting business is anticipated to rebound due to government policies promoting consumption and municipal construction projects [16] - The company has secured a 200 million yuan entertainment project in Saudi Arabia, indicating strong international growth potential [16] Overall Profitability and Future Outlook - Excluding Wutong Tree's contributions, Roman Holdings expects a significant recovery in net profits from its other two business segments in 2025-2027, with estimates of 102 million, 124 million, and 153 million yuan respectively [17] - The market has not fully priced in Wutong Tree's technological and performance advantages, suggesting a positive long-term growth outlook for Roman Holdings [17]