Sinoseal (300470) Q1 2026 earnings summary

Executive summary

• Revenue for Q1 2026 was ¥397.97 million, down 3.05% year-over-year, with net profit attributable to shareholders at ¥66.54 million, a 29.48% decrease year-over-year.

• The decline in profit was mainly due to weaker demand in the domestic petrochemical industry and intensified competition in both domestic and international markets, leading to lower gross margins in the mechanical seal segment.

Financial highlights

• Gross margin dropped to 36.54% from 44.43% year-over-year, mainly due to a higher proportion of lower-margin incremental business and reduced government subsidies.

• Operating cash flow turned positive at ¥6.42 million, up 235.42% year-over-year.

• Total assets at quarter-end were ¥3.49 billion, down 0.37% from year-end 2025, while shareholders’ equity rose 2.56% to ¥2.97 billion.

• Basic and diluted EPS were ¥0.3272 and ¥0.3250, respectively, both down nearly 30% year-over-year.

Outlook and guidance

• The company expects continued market competition and pressure on gross margins due to weak demand in the petrochemical sector and international expansion challenges.