Sinoseal (300470) H1 2025 earnings summary

Executive summary

• Revenue for H1 2025 reached ¥857.53 million, up 18.45% year-over-year; net profit attributable to shareholders was ¥187.48 million, up 8.1% year-over-year.

• Adjusted net profit (excluding stock incentive expense) rose 16.76% year-over-year to ¥202.49 million.

• All business segments showed growth, with mechanical seals and the acquisition of KS GmbH as key drivers.

• Cash flow from operations decreased 38.94% year-over-year due to increased procurement for international projects and higher personnel and tax costs.

• Gross margin was 44.03%, down 3.11 percentage points year-over-year, mainly due to product mix and consolidation of lower-margin KS GmbH.

Financial highlights

• Operating income: ¥857.53 million (+18.45% YoY); net profit: ¥187.48 million (+8.1% YoY).

• Adjusted net profit: ¥202.49 million (+16.76% YoY).

• Operating cash flow: ¥46.27 million (-38.94% YoY).

• Basic EPS: ¥0.9106; diluted EPS: ¥0.9049.

• Total assets: ¥3.30 billion (+2.38% from year-end 2024); net assets: ¥2.78 billion (+4.17%).

• Non-recurring profit: ¥13.95 million, mainly from government subsidies and fair value gains.

Outlook and guidance

• Domestic market remains challenging with few new large petrochemical projects and low downstream industry sentiment.

• International business continues to grow, especially in high-end petrochemical markets and developing countries.

• Focus remains on expanding new energy, water treatment, and international markets for future growth.

• Proposed interim dividend: ¥5 cash per 10 shares, representing 55.46% of H1 net profit.