Core Viewpoint - Longhua Technology reported a revenue of 811 million yuan in Q3, representing a year-on-year increase of 14.50% but a quarter-on-quarter decrease of 7.46%. The net profit attributable to shareholders was 68.84 million yuan, with a year-on-year increase of 39.78% and a quarter-on-quarter increase of 3.36% [1] Financial Performance - For the first three quarters of 2025, the company achieved a revenue of 2.326 billion yuan, reflecting a year-on-year growth of 20.49%. The net profit attributable to shareholders was 180 million yuan, up 16.64% year-on-year, while the net profit excluding non-recurring items was 161 million yuan, increasing by 19.12% year-on-year [1] - The gross margin for the first three quarters of 2025 increased by 1.4 percentage points compared to the beginning of the year, reaching 23.20%. The expense ratio decreased to 13.95%, down 0.6 percentage points year-on-year, with financial expenses dropping from 2.43% to 1.66% due to the delisting of convertible bonds [1] Strategic Initiatives - The company is actively expanding into strategic emerging fields with new materials. Its subsidiary, Sanuo New Materials, focuses on rare earth separation, lithium extraction from salt lakes, and battery metal recycling, establishing long-term partnerships with major rare earth suppliers [2] - The company's target material business includes high-purity molybdenum and molybdenum alloy targets for TFT-LCD/AMOLED, ITO targets, silver alloy targets, and ultra-high purity sputtering targets for semiconductor IC manufacturing, primarily used in display panels and photovoltaic fields [2] - The EPMI wave-absorbing foam has successfully broken the foreign companies' market blockade in China, achieving domestic substitution [3] Profit Forecast and Valuation - The company maintains its net profit forecast for 2025-2027 at 232 million, 258 million, and 310 million yuan, respectively, corresponding to EPS of 0.22, 0.25, and 0.30 yuan. The estimated PE ratios for comparable companies in 2026 are 20.3X for energy-saving and environmental protection business and 23.0X for new materials [4] - Given the broad application space and continuous expansion of the company's material business, a valuation premium is applied to the new materials segment, resulting in a target price of 9.64 yuan for 2026, down from a previous value of 10.49 yuan [4]

Summary of Longhua Technology Conference Call Company Overview - **Company**: Longhua Technology - **Date**: October 29, 2025 Key Points Industry and Company Performance - Longhua Technology's operating cash flow significantly improved in the first three quarters of 2025, with a notable decrease in debt ratio and financial costs, establishing a solid financial foundation for future growth [2][3] - The company achieved a profit of 69 million yuan in Q3 2025, maintaining a strong growth momentum with approximately 20% growth in both sales and profit for the first three quarters [3] Business Segments Performance - **Composite Materials**: This segment performed exceptionally well, with subsidiary Zhaoheng Technology maintaining a growth rate of 40%-50%. The revenue for the first three quarters reached the total of the previous year [2][4] - **Extraction Agents**: The business underperformed due to environmental and construction delays, with production expected to be postponed to 2026 [2][5][6] - **Optoelectronic Target Materials**: The display panel segment remains dominant, but there are positive signs of improvement in the photovoltaic sector, particularly with increased orders for perovskite and BC series products [2][8] Strategic Initiatives - Longhua Technology acquired a minority stake in Zhaoheng Technology and integrated it with Siwinuo to enhance its foam material product line, expecting Zhaoheng's annual sales to reach 400-500 million yuan with a profit of nearly 100 million yuan [2][7] - Siwinuo's revenue in the wind power sector accounts for about 95%, but the company plans to focus on high-end PVC and PMI areas to improve profit margins rather than expanding capacity [2][11] Future Growth and Challenges - The extraction agent project aims to achieve half of its capacity by the end of 2025, but environmental constraints have delayed progress [12] - Longhua Technology anticipates significant growth in 2026 from the extraction business and other segments, projecting sales of approximately 1 billion yuan from the extraction business alone [15] - The company is exploring new applications in energy efficiency and environmental protection, including data centers and nuclear fusion, while also expanding into overseas markets to counter domestic challenges [14][16] Financial Outlook - The company expects to turn profitable in 2025, with a focus on improving cash flow and reducing financial costs [3][13] - The integration of Siwinuo into Zhaoheng is expected to streamline operations and enhance profitability without expanding production capacity [17] Additional Insights - Longhua Technology's photovoltaic perovskite component clients include major manufacturers like Longi and Xiexin, indicating strong industry partnerships [9] - The company is actively managing its financial structure to optimize costs and improve overall performance, with a focus on achieving set targets despite setbacks in the extraction segment [13][18]

Core Viewpoint - 隆华科技 reported strong revenue growth in H1 2025, with a revenue of 1.515 billion yuan, representing a year-over-year increase of 23.95% and a net profit of 112 million yuan, up 5.83% year-over-year [1] Group 1: Financial Performance - In Q2 2025, the company achieved revenue of 876 million yuan, marking a year-over-year increase of 50.95% and a quarter-over-quarter increase of 37.16% [1] - The company's material business saw significant gross margin improvement, contributing to the overall positive revenue growth [2] - The revenue from traditional energy-saving products, target materials, ultra-high temperature special functional materials, water treatment systems, foam products, and extraction agents accounted for 35.87%, 26.91%, 13.49%, 9.44%, and 8.76% of total revenue, respectively [2] Group 2: Business Expansion - The company is expanding its electronic materials business beyond traditional display fields into areas such as foldable screens and various battery technologies [3] - The company is actively developing high-performance furnace components for high-temperature vacuum furnaces, targeting markets in aerospace, naval vessels, vehicles, radar communication, medical devices, and more [3] - The company’s subsidiary, Sanuo New Materials, achieved revenue of 133 million yuan in H1 2025, growing 6.22% year-over-year, focusing on rare earth separation and lithium extraction [3] Group 3: Profit Forecast and Valuation - The company maintains profit forecasts for 2025-2027 at 232 million, 258 million, and 310 million yuan, respectively, with corresponding EPS of 0.26, 0.29, and 0.34 yuan [4] - The estimated PE ratios for comparable companies in 2025 are 30.2x and 30.6x, with a valuation premium applied to the new materials segment due to its broad application potential [4] - The target price for the company is set at 10.49 yuan, reflecting an increase from the previous value of 8.92 yuan [4]

Core Viewpoint - 隆华科技 reported a significant increase in revenue and profit for the first half of 2025, indicating strong growth and improved profitability in its core business segments [1]. Business Performance - The company achieved an operating income of 1.515 billion yuan, a year-on-year increase of 23.95% [1]. - The net profit attributable to shareholders was 112 million yuan, up 5.83% year-on-year, while the net profit excluding non-recurring items reached 105 million yuan, reflecting a 13.29% increase [1]. Key Business Segments - The electronic new materials segment is a strategic focus, with breakthroughs in technology that challenge foreign monopolies. The subsidiary Fenglian Ke Optoelectronics has made significant advancements in high-end target materials, supplying major global panel manufacturers [2]. - In the photovoltaic sector, the company’s HITO target materials have shown higher efficiency compared to peers, and significant breakthroughs have been made in the development of new low-indium and no-indium high-efficiency target materials [2]. - The polymer composite materials segment has also performed well, with products being widely used in rail transportation and aerospace applications. The subsidiary Kebo Si has achieved international advanced levels in its projects [3]. R&D and Innovation - The company has increased its R&D investment to 61.215 million yuan, a year-on-year growth of 12.18%, ensuring support for technological breakthroughs and product iterations [4]. - Moving forward, 隆华科技 plans to continue driving innovation, focusing on electronic new materials, polymer composite materials, and energy-saving environmental protection, while promoting collaborative development across its business segments [4].

Core Viewpoint - The company reported a revenue of 2.711 billion yuan for 2024, marking a year-on-year increase of 9.87%, and a net profit attributable to shareholders of 131 million yuan, up 3.37% year-on-year. However, in Q1 2025, revenue decreased by 0.46% to 639 million yuan, and net profit fell by 18.12% to 45 million yuan [2][3]. Group 1: Business Segments Performance - The electronic new materials segment achieved a revenue of 678 million yuan in 2024, a significant year-on-year growth of 43.38%, with a gross margin of 22.12%, up 2.75 percentage points [3]. - The polymer composite materials segment generated a revenue of 330 million yuan, reflecting a year-on-year increase of 3.94%, with a notable gross margin improvement to 39.89%, up 6.11 percentage points [3]. - The energy-saving and environmental protection products and services segment reported a revenue of 1.702 billion yuan, a year-on-year growth of 1.54%, but with a gross margin of 20.08%, down 3.92 percentage points [3]. Group 2: Technological Advancements and Market Position - The company's target material business has a high technical barrier, with the ITO target material project officially commencing production in 2024. The market share of the optical target material business is gradually expanding, with significant growth in the new silver alloy target material for AMOLED applications [4]. - The company is actively developing multiple tracks in the ITO target material sector, including perovskite and heterojunction stacked batteries, achieving a breakthrough in electronic mobility rates with its self-developed high mobility HITO target material [4]. - The successful production of the 500-ton ITO target material project in July 2024 alleviated capacity bottlenecks [4]. Group 3: Strategic Initiatives in Lithium Battery Recycling - The company has focused its extraction agent business on lithium battery recycling, establishing stable strategic partnerships with leading enterprises across various sectors, including nickel-cobalt separation and rare earths [5]. - In 2024, the company successfully launched a high-performance extraction agent project with an annual production capacity of 60,000 tons, increasing its production capacity from 20,000 tons/year to 80,000 tons/year, with projected annual output value rising from 400 million yuan to 2.7 billion yuan [5]. - The upcoming peak period for retired power batteries presents new opportunities for the application of wet extraction technology and products in the recycling and circular economy sector [5].