Core Viewpoint - Zhejiang Southeast Steel Structure Co., Ltd. has won the bid for the "Hangzhou Government Storage (2025) No. 20 Intelligent Robot and Health Care Technology R&D Base Project Phase I EPC General Contracting" with a total bid amount of RMB 1,322.90 million, which is expected to positively impact the company's future operations [1][3]. Group 1: Project Details - Project Name: Hangzhou Government Storage (2025) No. 20 Intelligent Robot and Health Care Technology R&D Base Project Phase I EPC General Contracting [1] - Bidder: A consortium consisting of Zhejiang Southeast Steel Structure Co., Ltd., Chaofeng Steel Structure Group Co., Ltd., and Zhejiang Provincial Architectural Design Research Institute Co., Ltd. [1] - Total Bid Amount: RMB 1,322.90 million [1] - Project Scope: Includes all construction drawings, various special designs, construction budget preparation, construction, equipment procurement, completion drawings, acceptance, and other construction-related services [1][2]. Group 2: Project Impact on the Company - The project adopts the EPC general contracting model, which will help the company transition from specialized subcontracting to general contracting, aligning with its "EPC General Contracting + No. 1 Project" dual-engine development strategy [3]. - The total bid amount represents 11.77% of the company's audited revenue for the fiscal year 2024, indicating a significant contribution to future revenue [3].

Financial Performance - The company reported a total revenue of 4.538 billion yuan, a year-on-year decrease of 27.28% [1] - The net profit attributable to shareholders was 42.1545 million yuan, down 67.28% year-on-year [1] - In Q2, total revenue was 2.1 billion yuan, a decline of 35.04% year-on-year, with a net profit of -4.7475 million yuan, a decrease of 111.99% [1] - The gross margin was 7.96%, a decrease of 0.2% year-on-year, while the net margin was 0.96%, down 53.48% year-on-year [1] - Total sales, management, and financial expenses amounted to 198 million yuan, accounting for 4.36% of revenue, an increase of 24.24% year-on-year [1] - Earnings per share were 0.04 yuan, a decrease of 63.64% year-on-year [1] Financial Ratios and Cash Flow - The company's accounts receivable were significantly high, with accounts receivable to net profit ratio reaching 2165.62% [1] - The net cash flow from operating activities decreased by 566.69% due to payments for trade activities [3] - The net cash flow from financing activities increased by 175.18% due to higher borrowing [4] - The company’s return on invested capital (ROIC) was 2.81%, indicating weak capital returns [5] - The average cash flow from operating activities over the past three years has been negative [7] Business Strategy and Future Plans - The company aims to implement the "EPC General Contracting + No. 1 Project" strategy to drive high-quality development [7] - Plans to focus on green and low-carbon construction, expanding into new energy markets with a comprehensive energy business model [7] - The company will respond to the "Belt and Road" initiative by expanding its business in core regions and enhancing its global brand influence [8] - Emphasis on digital management and smart manufacturing to reduce production costs and improve product quality [9]

Group 1 - The company, Dongnan Network (002135), has won a bid for the "Qianjiang Century City Intelligent Comprehensive Sci-tech Park EPC Project" in collaboration with Zhejiang Guofeng Group Co., Ltd. and Zhejiang University Architectural Design Institute Co., Ltd. [1] - The total bid amount for the project is RMB 1.183 billion, which accounts for 10.52% of the company's audited revenue for the year 2024 [1] - The total planned investment for the project is RMB 3.956 billion, with a total construction area of 273,600 square meters, including approximately 213,000 square meters above ground and about 59,000 square meters underground [1] Group 2 - The project consists of 11 independent buildings, with the tallest building being a super high-rise research and development center reaching 150 meters [1] - The project will be constructed using the EPC (Engineering, Procurement, and Construction) model, which will assist the company in transitioning from a steel structure subcontractor to a general contractor [1] - This aligns with the company's dual-engine development strategy of "EPC General Contracting + No. 1 Project," which is expected to enhance the company's brand influence within the industry [1]