AECC AERO-ENGINE CONTROL (000738) Q2 2025 earnings summary

Executive summary

• Revenue for H1 2025 was ¥2.74 billion, down 2.5% year-over-year, mainly due to military product VAT reform policy impacts.

• Net profit attributable to shareholders was ¥309 million, a 34.32% decrease year-over-year, primarily from lower gross profit.

• Cash flow from operating activities surged 446.13% year-over-year to ¥1.01 billion, driven by increased cash from sales.

• The company maintained its industry-leading position in aero-engine control systems, with continued investment in R&D and digital manufacturing.

Financial highlights

• Operating income: ¥2,735,534,081.32, down 2.5% year-over-year.

• Net profit attributable to shareholders: ¥308,505,313.75, down 34.32% year-over-year.

• Basic and diluted EPS: ¥0.2346, down 34.32% year-over-year.

• Gross margin for manufacturing: 27.49%, down 3.08 percentage points year-over-year.

• Total assets at period end: ¥16.48 billion, up 1.02% from year-end 2024.

• Net assets attributable to shareholders: ¥12.44 billion, up 0.72% from year-end 2024.

• R&D investment intensity: 9.57% of revenue, down 1.37 percentage points year-over-year.

• Net asset return rate: 2.47%, down 1.46 percentage points year-over-year.

• Operating cash flow: ¥1,008,726,518.74, up 446.13% year-over-year.

Outlook and guidance

• The company aims to optimize product structure, ensure delivery of key military and civil projects, and accelerate the development of commercial, general aviation, and derivative businesses.

• Focus remains on technological innovation, digital transformation, and expanding into new markets such as aerospace and marine.