Financial Performance - The total operating revenue for General Elevator in the first half of 2025 was 156.49 million yuan, a decrease of 40.91% compared to 265.46 million yuan in the same period last year [1] - The net profit attributable to shareholders was -17.89 million yuan, a significant drop of 14,413.84% from 125,000 yuan in the previous year [1] - The net profit attributable to shareholders after deducting non-recurring gains and losses was -18.44 million yuan, an increase of 524.19% from -2.95 million yuan year-on-year [1] - The basic earnings per share were -0.0745 yuan, down 15,000% from 0.0005 yuan in the same period last year [1] - The weighted average return on net assets was -2.87%, a decline of 2.89% from 0.02% in the previous year [1] Asset and Equity Position - As of the end of the reporting period, the total assets of General Elevator were 987 million yuan, a decrease of 3.76% from 1.025 billion yuan at the beginning of the period [2] - The equity attributable to shareholders was 615 million yuan, down 2.68% from 632 million yuan at the beginning of the period [2] - The net asset per share attributable to shareholders was 2.56 yuan, a decrease of 2.66% from 2.63 yuan at the beginning of the period [2] Market Conditions - General Elevator indicated that the decline in operating revenue by 40.91% in the first half of 2025 was due to intense market competition and a decrease in product prices [3] Company Overview - General Elevator Co., Ltd. is located in Wujiang District, Suzhou, Jiangsu Province, and was established on August 21, 2003. It was listed on January 21, 2021 [8] - The company primarily engages in the research, design, manufacturing, sales, installation, renovation, and maintenance of elevators, escalators, and moving walkways, providing comprehensive solutions for various building elevator systems [8]

Company Overview - Zhejiang Meilun Elevator Co., Ltd. is engaged in the research, production, sales, installation, and maintenance of elevators, escalators, moving walkways, and related components [1][2][3] - The company has established a strong reputation in the domestic elevator industry and holds various national and provincial honors, including being a national high-tech enterprise and a "little giant" enterprise [2][4] Financial Data - As of 2025, the total assets of the company are approximately 1.93 billion yuan, with total liabilities of about 649 million yuan [5] - The company's revenue for the first quarter of 2025 is reported at approximately 129.21 million yuan, with a net profit attributable to shareholders of about 4.28 million yuan for the same period [5] - The gross profit margin for the first quarter of 2025 is 22.10%, while the weighted average return on net assets is 0.35% [5] Business Performance - The company has experienced fluctuations in revenue, with a reported revenue of 95.53 million yuan in 2023, down from 101.62 million yuan in 2022 [5] - The net profit attributable to the parent company for 2023 was approximately 13.44 million yuan, compared to 8.18 million yuan in 2022 [5] Market Position - The company has a comprehensive sales network covering major regions in China and over 30 countries globally, indicating a strong market presence [4] - The company emphasizes technological advancement and product quality, focusing on energy-saving, environmentally friendly, and safe elevator products [4] Securities Issuance - The company plans to issue A-shares through a simplified procedure to specific investors, with a total fundraising amount not exceeding 300 million yuan [13][17] - The issuance price is set at 5.66 yuan per share, with a total of approximately 42 million shares to be issued [17][18] Investment Projects - The raised funds will be primarily allocated to the "Nanning Intelligent Manufacturing Base Project," which aims to enhance the company's production capacity and optimize regional layout [18][19]

Financial Data and Key Metrics Changes - Otis reported net sales of $3.6 billion, flat year-over-year, with organic sales down 2% [18] - Adjusted EPS for the first half of the year was $1.97, growing 2% compared to the same period last year [9] - Adjusted operating profit margin remained flat at 17% year-over-year [18] Business Line Data and Key Metrics Changes - Service segment organic sales grew 4%, driven by maintenance and repair growth of 4% and a repair business growth of 6% [20][21] - New equipment organic sales declined 11%, with EMEA sales growing 7% but offset by declines in China, Americas, and Asia Pacific [22] - Modernization organic sales grew 5%, with notable growth in China exceeding 20% [21] Market Data and Key Metrics Changes - Combined new equipment and modernization orders grew 4%, with orders in the Americas and Asia Pacific increasing significantly [12][13] - In China, new equipment orders declined by more than 20%, while the rest of the world saw an 11% increase [13] - The backlog for new equipment remained flat year-over-year, but excluding China, it increased by 10% [12] Company Strategy and Development Direction - The company is focused on achieving $200 million in run rate savings by year-end through initiatives like Uplift and China transformation [7] - Otis aims to enhance customer centricity and invest in growth despite economic challenges, particularly in China [7][30] - The modernization opportunity is driven by an aging installed base of 22 million units, expected to support multiyear growth [14] Management's Comments on Operating Environment and Future Outlook - Management anticipates a low single-digit decline in the Americas and a high single-digit decline in Asia, primarily due to challenges in China [25][26] - The global new equipment market is expected to decline mid-single digits in 2025, with service organic sales growth expected to ramp up [26][30] - Management remains optimistic about the service business, which represents approximately 90% of total operating profit [30] Other Important Information - The company completed approximately $300 million in share repurchases in Q2, totaling $550 million year-to-date [9] - Otis has been recognized for its sustainability efforts, being included in various climate leader lists [10] Q&A Session Summary Question: Can you unpack service growth and retention? - Management noted that service revenue growth is equal to portfolio growth, with churn and mix affecting results. Repair sales increased significantly, and they expect further growth in the coming quarters [45][49][51] Question: What is the outlook for new equipment orders in the Americas and China? - Management reported strong performance in North America with a 15% increase in new equipment orders, while China remains weak but is expected to stabilize [60][62] Question: How will free cash flow look in the second half of the year? - Free cash flow is expected to align with the second half of 2024, with a focus on stabilizing new equipment and improving collections in service [84][86] Question: What are the dynamics around operating margins and tariff impacts? - Management indicated that while tariffs will be a headwind, improvements in service margins and productivity from ongoing initiatives will help offset these impacts [113][115]

Financial Data and Key Metrics Changes - Otis reported net sales of $3.6 billion, flat year-over-year, with organic sales down 2% [17] - Adjusted EPS for the first half of the year was $1.97, growing 2% compared to the same period last year [7] - Adjusted operating profit margin remained flat at 17% year-over-year [17] - Adjusted free cash flow was $243 million for the quarter [18] Business Line Data and Key Metrics Changes - The Service segment saw organic sales growth of 4%, driven by maintenance and repair [19] - New equipment organic sales declined by 11%, with EMEA growing 7% but offset by declines in China, Americas, and Asia Pacific [21] - Modernization organic sales grew 5%, with a strong backlog up 16% at constant currency [20] Market Data and Key Metrics Changes - Orders in The Americas increased by 15%, while China saw a decline of over 20% [58][62] - Excluding China, new equipment orders grew by 11% [62] - The global new equipment market is expected to decline mid-single digits in 2025, with China anticipated to decline approximately 10% for the remainder of the year [25][26] Company Strategy and Development Direction - Otis is focused on customer-centric initiatives and cost-saving measures, targeting $200 million in run rate savings by year-end [6] - The company is executing a transformation in China to adapt to market conditions, with a focus on modernization and service growth [80] - The modernization opportunity is driven by an aging installed base of 22 million units, expected to create a multi-year growth cycle [13] Management's Comments on Operating Environment and Future Outlook - Management noted continued economic challenges in China but expressed optimism for future growth in the region [60] - The service business is expected to remain resilient, representing approximately 90% of total operating profit [28] - Adjusted EPS outlook for 2025 remains unchanged at $4 to $4.1 per share, indicating a growth of 4% to 7% compared to 2024 [29] Other Important Information - Otis completed approximately $300 million in share repurchases in the second quarter, totaling $550 million year-to-date [7] - The company received several sustainability awards, highlighting its commitment to environmental performance [9] Q&A Session Summary Question: Can you unpack service growth and retention during this economic period? - Management indicated that service revenue growth is aligned with portfolio growth, with churn and mix affecting overall performance. Retention improved slightly in Q2 compared to Q1 [44][52] Question: What are the growth pockets in The Americas despite multifamily drag? - North America saw a strong performance in infrastructure projects, with new equipment orders up 15%. Multifamily orders were flat year-over-year, which is seen as a positive sign [58][59] Question: What is the outlook for China and its impact on next year's performance? - The new equipment market in China remains weak, but management expects sequential improvement. The focus is on value and retaining service portfolio [60][62] Question: How will free cash flow and operating margins be affected in the second half? - Free cash flow is expected to stabilize, with service growth offsetting declines in new equipment. Operating margins are anticipated to improve due to strong service performance and cost-saving initiatives [82][110]

Group 1 - Liu Wenchao, born in 1971, has been the Chairman and General Manager of Xizi Elevator Technology Co., Ltd. since 2003, leading the company for 22 years and transforming it from a regional brand into a nationally recognized elevator manufacturer [2][6] - Xizi Elevator, established in 1997, specializes in the research, manufacturing, sales, installation, and after-sales service of elevators, escalators, and moving walkways, holding national A-level manufacturing and installation qualifications [4] - The company operates over 30 direct subsidiaries and more than 500 sales and service outlets across China, exporting products to over 80 countries and regions, and has undertaken significant projects like the Shanghai Bund International Financial Service Center [4] Group 2 - Liu Wenchao is recognized as a visionary leader who emphasizes technological research and development, attracting top industry talent and overcoming technical challenges to advance elevator products' intelligence, efficiency, and safety [6] - He has actively participated in the formulation and revision of industry standards, contributing to the elevator industry's standardized and healthy development, and has a notable presence in industry conferences [6] - The sudden passing of Liu Wenchao has caused significant shock within the industry, with many colleagues and partners expressing their disbelief and sorrow over the loss of such a prominent figure [7][9]

Core Viewpoint - Multiple metro operators in China are promoting the practice of standing still on escalators instead of the traditional "keep left, stand right" approach, emphasizing safety as the primary reason for this change [2][3][4]. Group 1: Safety Concerns - The shift from "keep left, stand right" to standing still is primarily driven by safety concerns, as walking on escalators increases the risk of accidents such as falls [2][3]. - The operational characteristics of escalators, including their height and speed, contribute to a higher risk of accidents when passengers walk or run on them [3][4]. - Increased passenger flow during peak hours necessitates a more efficient use of escalator capacity, which can be achieved by having passengers stand side by side [3]. Group 2: Implementation and Communication - Metro operators are implementing various measures to promote the new standing policy, including clear signage, audio reminders, and visual aids to guide passengers [2][3]. - In Beijing, initiatives include the installation of yellow warning lines and footprints on escalators to encourage passengers to stand within safe zones [3]. - Shanghai has removed references to "keep left, stand right" from safety materials and emphasizes the prohibition of walking or running on escalators in its public safety campaigns [4]. Group 3: Industry Recommendations - Industry experts suggest using multiple communication channels, such as broadcasts, posters, and safety weeks, to educate the public about the risks associated with walking on escalators and the benefits of standing still [5]. - Regular safety demonstrations and interactive experiences are recommended to enhance public understanding of escalator safety [5].

Industry Insights - The State Administration for Market Regulation has drafted a notice to improve the updating of old residential elevators, focusing on production, inspection, usage, and regulation [1] - The notice emphasizes that safety performance indicators for components selected for updating elevators must not be lower than those of the existing elevators [1] - The market for updating old elevators is identified as a new growth area, combining public demand and industrial upgrades, with policies supporting funding and regulatory collaboration [1] - As of 2023, China has over 9 million elevators, with 15%-20% (over 1.3 million) classified as "old elevators" over 15 years old, and an annual addition of 500,000 to 600,000 elevators entering the aging cycle [1] - The market for old elevator updates is expected to grow at an average annual rate of 18% until 2035, potentially exceeding 100 billion yuan in the next 5-10 years [1] Company Developments - Kone Elevator focuses on elevator research and manufacturing, integrating information technology and automation, and is developing new business growth points such as installation of new elevators, updating old elevators, and home elevators [2] - Meilun Elevator specializes in elevators and escalators, along with related products, and is positioned at a leading level in the domestic market [2]

Financial Data and Key Metrics Changes - The company reported strong financial performance in 2024, attributed to operational excellence and effective strategy execution [3] - Approximately 89.6% of the voting power was represented at the annual meeting, indicating strong shareholder engagement [10] - The preliminary vote report showed that the advisory vote for executive compensation was approved by only 39.3% of the votes, suggesting potential concerns among shareholders [20] Business Line Data and Key Metrics Changes - The company maintains approximately 2,400,000 elevators and escalators globally, representing the largest service portfolio in the industry [3] - The new equipment business is primarily impacted by tariffs, with an estimated impact ranging from $45 million to $75 million for the remainder of the 2025 fiscal year [22] Market Data and Key Metrics Changes - The company serves customers in over 200 countries and territories, highlighting its extensive global reach [3] - The company is expanding its supply chain to mitigate tariff impacts, indicating adaptability to market conditions [22] Company Strategy and Development Direction - The company is focused on a results-driven, digitally focused, and service-oriented growth strategy to deepen customer relationships and enhance efficiency [2] - The transformational uplift program aims to optimize the organizational structure and drive efficiency at all levels [2][5] - The mission is to be a world-class customer-centric service-oriented company, aligning with global macro trends and new expectations [4][5] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the complex and dynamic nature of the modern world, emphasizing the need for resilience and clarity of mission [5] - The company is actively working on mitigation plans with customers to protect against future tariffs [23] Other Important Information - The company has a strong workforce of 72,000 colleagues, including 44,000 field professionals [3] - The board unanimously recommended a vote against the shareholder proposal for transparency in political spending, indicating a strategic stance on corporate governance [18] Q&A Session Summary Question: What areas of Otis will be impacted by tariffs and what is being done to minimize the impact? - The new equipment business is primarily impacted by tariffs, with an estimated impact of $45 million to $75 million for the remainder of 2025 [22] - The company is expanding its supply chain to multiple suppliers and moving some operations to the United States to mitigate the impact [23]

Financial Data and Key Metrics Changes - Otis Worldwide Corporation reported net sales of $3.3 billion with organic sales flat year over year [24] - Adjusted operating profit increased by 3% excluding a $16 million foreign exchange headwind, with adjusted operating profit margin expanding by 40 basis points to 16.7% [24][11] - Adjusted EPS grew by 5% or $0.04 in the quarter, driven by solid operational performance and a lower share count [25] Business Line Data and Key Metrics Changes - Service organic sales grew by 4%, with maintenance and repair services increasing by 3% and modernization orders rising by 12% [10][26] - New equipment organic sales declined by 7%, with EMEA sales growing mid-single digits and APAC growing approximately 10% [29][30] - Service operating profit increased to $537 million, with operating profit margins expanding to 24.6% [28] Market Data and Key Metrics Changes - Americas saw strong orders performance, growing mid-teens, while Asia Pacific orders grew greater than 20%, primarily driven by India and Southeast Asia [15][16] - New equipment orders in China declined greater than 20%, aligning with expectations, while EMEA experienced mid-single digit declines [15][16] - The total backlog, including maintenance and repair, remains at historically high levels, positioning the company well for future quarters [14] Company Strategy and Development Direction - The company is focused on service-driven business models and modernization opportunities, with a projected multiyear growth cycle in modernizations due to an aging installed base [17][19] - Otis is implementing transformation initiatives, including Uplift and a China transformation program, to drive process efficiencies and capture service and modernization opportunities [50][52] - The company anticipates adjusted free cash flow of approximately $1.6 billion, primarily returning capital to shareholders through dividends and share repurchases [44] Management's Comments on Operating Environment and Future Outlook - Management expects the global new equipment market to stabilize later in 2025, with a projected decline in new equipment units of mid-single digits for the year [35][36] - The service business, representing approximately 90% of segment operating income, is largely insulated from tariff impacts, with expectations for continued growth [39][40] - Management remains optimistic about the service flywheel model and anticipates stronger growth in the second half of the year due to backlog execution and cost savings realization [57][60] Other Important Information - The company announced an 8% increase in its dividend, bringing cumulative dividend increases since the spin-off to approximately 110% [12][44] - Otis was recognized by Fortune as one of the world's most admired companies and named to the Wall Street Journal's best-managed companies list [12] Q&A Session Summary Question: Can you provide clarity on the gross headwind from tariffs? - Management indicated that the annualized impact of China tariffs is around $90 million, with mitigation efforts expected to offset half of this amount [66][68] Question: Are you seeing any impact at the local level in China regarding US companies? - Management stated that there is no overt targeting of Otis Worldwide Corporation in China, and they continue to develop relationships at all levels of government [78] Question: What is the pricing strategy in response to tariffs? - Management confirmed that they have increased prices across new equipment and maintenance services, with a focus on passing inflation costs to customers [80] Question: What is the outlook for new equipment orders in China? - Management expects the China market to be down 15% in the second quarter, with a gradual improvement anticipated in the second half of the year [84] Question: Can you elaborate on the project delays in the Americas? - Management noted that project delays are primarily due to uncertainty around global trade policies, but they remain optimistic about backlog execution and future orders [122][126]