Summary of Anke Electric's Conference Call Company Overview - **Company**: Anke Electric - **Industry**: Electric Power Equipment and Systems Key Points Financial Performance - In the first half of 2025, Anke Electric's overall revenue decreased by 32% year-on-year, primarily due to a decline in domestic renewable energy investments and government infrastructure project investments [3][4] - The cable system business saw a 10% decline compared to the same period last year, mainly due to delays in the completion of 220kV and 500kV products, with expected revenue recognition in the second half of the year [3][4] - Revenue from household products and system services dropped significantly from 136 million yuan to 60 million yuan, attributed to a shift from large projects to smaller orders [3][4] - R&D expenses increased by 13 million yuan, focusing on integrated machine development, transformer technology, and environmentally friendly gas research [2][3] Market Outlook - The company has a strong order backlog and anticipates accelerated project deliveries in the second half of the year, with expectations for the cable accessory business to remain stable or see slight growth [2][4] - Major projects for the second half include large orders from Haidong Commercial Center and Green Development Xinjiang, totaling nearly 200 million yuan [4] - The company is actively tracking ultra-high voltage projects, with an estimated total equipment volume of 2 to 3 billion yuan expected to be tendered by the end of this year to next year [2][7] Strategic Initiatives - The modular parallel station business is focusing on new energy boosting and supercomputing data centers, with multiple projects in Xinjiang, Qinghai, and Gansu [8] - The Yajiang project, approximately 1,800 kilometers long, is expected to be completed between the end of 2027 and 2030, utilizing 500kV equipment [9] Competitive Landscape - Anke Electric faces competition from new entrants like Pinggao and Hengchi Electric, which have rapidly improved their manufacturing capabilities [15] - Despite the competitive pressure, the company believes that the monopolistic nature of the grid industry provides a buffer against new entrants [15] Environmental and Technological Developments - The company is developing C4 environmentally friendly gas production facilities to address high carbon emissions from traditional SF6 insulation media, with production capacity expected by the end of the year [10][18] - Anke Electric is also focusing on reducing carbon emissions in the Yajiang project, with potential collaboration with State Grid for C4 technology development [19] International Expansion - The company is prioritizing overseas market expansion due to intense domestic competition, with successful sales in Russia and ongoing efforts in Egypt, Saudi Arabia, and Kuwait [16] - Anke Electric has achieved stable sales of over 20 million yuan annually with 3M and is working on product validation and certification for international markets [16] Product Pricing and Cost Structure - Current market prices for various products include 15,000 yuan/meter for 220kV three-phase products and approximately 8,000 yuan/meter for 500kV products [20][21] - The company anticipates cost reductions in the long term due to increased production volume, although prices are expected to remain stable due to the industry's monopolistic nature [20][21] Conclusion - Anke Electric maintains a positive outlook for the second half of 2025, driven by a solid order backlog and strategic project deliveries, while navigating challenges from market competition and environmental regulations [2][4][16]

Core Viewpoint - Jiangsu Ankao Smart Electric Co., Ltd. reported a growth in operating revenue for 2024, but a decline in net profit, while operating cash flow significantly increased [1][9]. Financial Performance - Operating revenue for 2024 reached CNY 1,085,039,917.46, a 13.21% increase from CNY 958,438,645.23 in 2023 [2]. - Revenue from the power industry was CNY 1,071,781,256.06, accounting for 98.78% of total revenue, with a year-on-year growth of 12.75% [2]. - Other industries contributed CNY 13,258,661.40, representing 1.22% of total revenue, with a significant increase of 67.91% [2]. - Specific product revenue growth included: - 330kV - 500kV cable connectors: CNY 43,493,475.79, up 70.27% - GIL products and system services: CNY 231,703,993.48, up 52.60% - Smart modular substations: CNY 378,914,615.50, up 20.02% - However, some products saw revenue declines, such as: - Medium and low voltage cable connectors: CNY 8,739,931.82, down 44.50% - Smart power system services: CNY 79,016,633.66, down 53.03% - Smart sea cotton energy storage charging system services: CNY 6,141,188.01, down 49.29% [2]. Profitability - Net profit attributable to shareholders was CNY 183,360,451.10, a decrease of 10.50% from CNY 204,865,598.01 in 2023 [3]. - Net profit excluding non-recurring gains and losses was CNY 153,109,340.85, down 7.90% from CNY 166,241,399.95 in 2023 [3]. - Non-recurring gains and losses totaled CNY 30,251,110.25, primarily from investment management and fair value changes of financial assets [3]. Earnings Per Share - Basic earnings per share decreased to CNY 1.12 from CNY 1.25, a decline of 10.40% [4]. - Diluted earnings per share, excluding non-recurring gains and losses, also fell [4]. Expenses - Sales expenses decreased to CNY 44,902,935.64, down 12.41% from CNY 51,265,627.72 in 2023 [5]. - Management expenses increased to CNY 57,593,249.59, up 15.52% from CNY 49,853,697.86, due to higher depreciation and salary costs [5]. - Financial expenses significantly decreased to CNY 1,323,419.54, down 81.47% from CNY 7,141,706.41, mainly due to reduced interest expenses [5]. - R&D expenses were CNY 56,632,357.88, down 12.41% from CNY 64,658,531.61, indicating a potential impact on future innovation [5]. R&D Investment and Personnel - R&D investment was CNY 56,632,357.88, accounting for 5.22% of operating revenue, down from 6.75% in 2023 [6]. - The number of R&D personnel increased to 231, up 58.22% from 146 in 2023, indicating a shift in strategy towards human resource investment [6]. Cash Flow - Net cash flow from operating activities was CNY 173,901,054.29, a significant increase of 102.57% from CNY 85,845,852.08 in 2023 [7]. - Cash flow from investing activities was -CNY 78,610,944.71, a decrease of 146.96% from CNY 167,394,454.28, reflecting increased cash outflows for fixed assets [7]. - Cash flow from financing activities improved to -CNY 72,239,942.55, an increase of 79.29% from -CNY 348,858,779.93, indicating better debt management [7].