Eagle Eye Alert: Tian Hong Shares Operating Revenue Declines

Sina Finance Listed Company Research Institute | Financial Report Eagle Eye Warning

On March 13, Tianhong Co., Ltd. released its 2025 annual report, with an audit opinion of standard unqualified audit opinion.

The report shows that the company’s total operating revenue for 2025 was 11.559 billion yuan, a decrease of 1.92% year-on-year; net profit attributable to shareholders was 83.1871 million yuan, an increase of 8.43%; non-recurring net profit was 9.8904 million yuan, down 29%; basic earnings per share were 0.0712 yuan per share.

Since listing in May 2010, the company has paid cash dividends 15 times, totaling 4.149 billion yuan. The announcement states that the company plans to distribute a cash dividend of 0.7 yuan (tax included) for every 10 shares to all shareholders.

The listed company financial report Eagle Eye warning system performs intelligent quantitative analysis of Tianhong Co., Ltd.'s 2025 annual report from four dimensions: performance quality, profitability, capital pressure and safety, and operational efficiency.

1. Performance Quality

During the reporting period, the company’s revenue was 11.559 billion yuan, down 1.92% year-on-year; net profit was 83.6373 million yuan, up 8.2%; net cash flow from operating activities was 1.635 billion yuan, down 17.12%.

Overall performance analysis to focus on:

• Decline in operating revenue. During the reporting period, operating revenue was 11.56 billion yuan, a decrease of 1.93%.

• Operating profit has been negative for three consecutive quarters. During the reporting period, the operating profits for the last three quarters were -20 million, -20 million, -60 million yuan, all negative.

• Divergence between revenue and net profit. During the reporting period, revenue decreased by 1.93% year-on-year, while net profit increased by 8.2%, showing a divergence.

Asset quality analysis:

• Accounts receivable/revenue ratio continues to grow. In the last three annual reports, the ratios were 1.39%, 1.54%, and 1.68%, respectively, showing a continuous increase.

• Cash flow quality: focus on:

• Net cash flow from operating activities continues to decline. In the last three annual reports, the net cash flows were 2.75 billion, 1.97 billion, and 1.635 billion yuan, respectively, showing a downward trend.

2. Profitability

During the reporting period, the company’s gross profit margin was 36.67%, down 0.6%; net profit margin was 0.72%, up 10.32%; return on equity (weighted) was 2.03%, up 9.14%.

Profitability analysis:

• Continuous decline in gross profit margin. In the last three annual reports, gross profit margins were 38.26%, 36.89%, and 36.67%, respectively, showing a downward trend.

• Gross profit margin decreased, net sales profit margin increased. During the reporting period, gross profit margin decreased from 36.89% to 36.67%, while net sales profit margin increased from 0.66% to 0.72%.

Asset-side profitability:

• The average return on net assets over the past three years has been below 7%. During the reporting period, the weighted average return on net assets was 2.03%, with an average below 7% over the last three fiscal years.

• Return on invested capital below 7%. During the reporting period, the company’s return on invested capital was 1.61%, with an average below 7% over the three periods.

Unusual gains and losses:

• High proportion of non-recurring income. During the reporting period, the ratio of non-recurring income to net profit was 98%. (Note: Non-recurring income includes investment net income, fair value changes, non-operating income, and losses on disposal of non-current assets).

3. Capital Pressure and Safety

During the reporting period, the company’s asset-liability ratio was 84.18%, a decrease of 1.54% year-on-year; current ratio was 0.3; quick ratio was 0.24; total debt was 3.304 billion yuan, all short-term debt.

Overall financial status:

• Current ratio continues to decline. In the last three annual reports, ratios were 0.8, 0.38, and 0.3, indicating weakening short-term debt-paying ability.

• Short-term capital pressure:

• Sharp increase in short-term to long-term debt ratio. During the period, short-term debt/long-term debt rose sharply to 0.37.

• Large short-term debt, capital gap exists. During the period, broad monetary funds were 2.68 billion yuan, short-term debt was 3.3 billion yuan, broad monetary funds/short-term debt ratio was 0.81, indicating funds are insufficient.

• Cash ratio below 0.25. During the period, the cash ratio was 0.13.

• Net cash flow from operating activities to current liabilities ratio continues to decline. In the last three annual reports, ratios were 0.23, 0.17, and 0.13.

Long-term capital pressure:

• Gradual decrease in total debt cash coverage ratio. In the last three reports, broad monetary funds/total debt ratios were 4.87, 0.25, and 0.22.

• From a capital management perspective:

• Total debt/total liabilities ratio exceeds 20%, interest expense/net profit ratio exceeds 30%. During the period, total debt/total liabilities was 56.59%, interest expense as a percentage of net profit was 221.45%, indicating significant impact on performance.

• Prepaid accounts payable/total current assets ratio continues to grow. In the last three annual reports, ratios were 0.35%, 1.13%, and 1.36%.

• Growth rate of prepaid accounts payable exceeds that of operating costs. During the period, prepaid accounts payable increased by 4.01% from the beginning, while operating costs decreased by 1.58%, indicating faster growth.

• Other receivables/total current assets ratio continues to grow. In the last three reports, ratios were 0.6%, 1.29%, and 1.6%.

4. Operating Efficiency

During the reporting period, accounts receivable turnover was 61.66, down 8.61%; inventory turnover was 9.1, up 1.1%; total asset turnover was 0.43, up 3.02%.

Asset management focus:

• Accounts receivable/total assets ratio continues to increase. In the last three annual reports, ratios were 0.59%, 0.64%, and 0.75%.

• Long-term assets: high proportion of other non-current assets. During the period, other non-current assets/total assets ratio was 24.96%.

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Sina Finance Listed Company Financial Report Eagle Eye Warning Introduction: The Eagle Eye Warning system is an intelligent professional analysis system for listed company financial reports. It gathers authoritative financial experts from accounting firms and listed companies to track and interpret the latest financial reports from multiple dimensions such as performance growth, earnings quality, capital pressure and safety, and operational efficiency, providing visual alerts for potential financial risks. It offers professional, efficient, and convenient technical solutions for financial risk identification and early warning for financial institutions, listed companies, and regulatory authorities.

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