Shenghui Cleanness (2521) H2 2025 earnings summary

Executive summary

• FY2025 revenue rose 3.2% YoY to RMB694.9m; gross profit increased to RMB118.4m, while net profit fell to RMB25.2m from RMB49.2m, mainly reflecting fair-value losses on financial assets.

• Gross margin improved to 17.0% from 15.0% on better cost control; net margin declined to 3.6% from 7.3%.

Financial highlights

• Revenue was RMB694.916m versus RMB673.558m; service costs rose 0.6% to RMB576.553m, slower than revenue growth.

• Gross profit was RMB118.363m versus RMB100.700m; other income, gains and losses rose to RMB15.318m from RMB2.433m, including rental income, insurance compensation and disposal gains.

• Profit before tax was RMB24.069m versus RMB59.231m; net profit was RMB25.163m versus RMB49.226m, with an income-tax credit of RMB1.094m versus tax expense of RMB10.005m.

• Administrative and other expenses increased 13.1% to RMB77.0m, primarily on higher staff costs; employee benefit expenses rose to RMB403.2m from RMB379.9m.

• Operating cash flow was RMB22.342m versus an outflow of RMB53.098m; investing outflow was RMB108.254m and financing inflow RMB62.691m.

Outlook and guidance

• Plans prioritize organic growth and expansion into PRC markets with strong demand for cleaning and maintenance, extending a footprint already spanning 17 provincial-level regions.

• Potential Greater Bay Area acquisitions or investments in cleaning and maintenance providers may broaden customer and geographic reach and support bids for major infrastructure cleaning work.

• Expansion opportunities also include waste-material recycling for packaging and the design, manufacture and sale of biodegradable materials.