Core Viewpoint - The company has approved a profit distribution plan for the first half of 2025, proposing a cash dividend of 1.00 yuan per 10 shares, amounting to a total distribution of approximately 53.27 million yuan, which represents 44.88% of the net profit attributable to shareholders for the same period [3][19][18]. Company Overview - The company is focused on enhancing its operational quality by divesting from non-core businesses and concentrating on manufacturing sectors such as new energy sanitation equipment and mining equipment [5][6]. - As of the end of the reporting period, the company has undergone a change in its main business focus, now primarily engaging in sanitation equipment, mining equipment, and basic engineering machinery [6]. Financial Data - The company reported a total of 7,019.32 million yuan available for distribution as of June 30, 2025 [19]. - The total number of shares eligible for the dividend distribution is 532,734,346 shares after excluding restricted shares [19]. Important Events - The company has completed the transfer of 85% equity in its subsidiary, which will no longer be included in the consolidated financial statements, allowing for a more focused business strategy [6][5]. - The board of directors has approved the asset impairment provision totaling 26.39 million yuan for the first half of 2025, which will reduce the profit for the period by the same amount [25][27]. Profit Distribution Plan - The profit distribution plan was approved unanimously by the board, and it does not require further approval from the shareholders' meeting [20][21]. - The cash dividend will be distributed based on the total share capital as of the equity distribution registration date, with adjustments made if there are changes in the share capital before that date [18][19]. Asset Impairment - The company has recognized an asset impairment provision of 26.39 million yuan, which includes provisions for receivables and inventory [25][27]. - The impairment assessment was conducted in accordance with accounting standards and reflects the company's commitment to accurately represent its financial condition [25][26].

Investment Rating - The investment rating for the company is "Accumulate" and is maintained [8] Core Views - In Q1 2025, the company achieved operating revenue of 707 million yuan, a year-on-year increase of 0.79%, and a net profit attributable to shareholders of 52 million yuan, representing a year-on-year growth of 62.47%. The non-recurring net profit attributable to shareholders was 40 million yuan, up 51.09% year-on-year. The significant profit increase was mainly driven by a reduction in asset impairment and a reversal of credit impairment, which collectively impacted pre-tax profit by 66.55 million yuan [2][6][11] - The company's gross margin continued to decline, while the expense ratio slightly increased. The company has recently announced plans to sell its sanitation service business to focus on its core equipment business, which is expected to enhance its competitive advantage and drive performance recovery in the long term [2][11] Summary by Sections Financial Performance - In Q1 2025, the company reported a total of 17,600 sanitation equipment insured, a year-on-year increase of 3.3%. The new energy sanitation equipment insured reached 2,631 units, up 78.1% year-on-year, indicating a recovery from the previous downturn. The overall insured volume for the company decreased by 29.8%, but revenue remained stable, suggesting that products were sold but not yet insured by clients [11] - The asset impairment loss for Q1 2025 was 7.92 million yuan, a decrease of 10.23 million yuan compared to the same period last year. The reversal of credit impairment due to historical accounts receivable increased revenue by 56.33 million yuan, contributing significantly to the profit increase [11] Cost and Expense Analysis - The comprehensive gross margin in Q1 2025 decreased by 4.4 percentage points to 19.1%, primarily due to intensified industry competition. The company's expense ratio increased by 3.3 percentage points, with sales expenses rising by 1.7 percentage points and management expenses (including R&D) increasing by 0.9 percentage points [11] - The cash flow situation has improved, with a cash collection ratio of 113.13% in Q1 2025, compared to 111.53% for the entire year of 2024, indicating healthy cash flow management [11] Strategic Focus - The company announced on April 23 its intention to sell 85% of its sanitation service subsidiary, aiming to focus on its core manufacturing business of new energy sanitation equipment and mining equipment. This strategic move is expected to enhance operational quality and avoid competition with sanitation service clients [11] - The long-term outlook for the company remains positive, as it possesses integrated manufacturing capabilities for chassis and superstructure, which provide cost advantages. The company has demonstrated strong cost control amid rising raw material prices and is expected to benefit from the low penetration rate of new energy equipment in the market [11] - The projected net profits attributable to shareholders for 2025-2027 are estimated at 280 million yuan, 380 million yuan, and 460 million yuan, corresponding to price-to-earnings ratios of 21x, 15x, and 13x, respectively [11]