SEALING TECHNOLOGY (301020) 2025 Annual Report Brief Analysis: Revenue and Net Profit Both Increase Year-over-Year, Profitability Improves

According to publicly available data compiled by Securities Star, Sealing Technology (301020) recently released its 2025 annual report. As of the end of this reporting period, the company’s total operating revenue was 562 million yuan, an increase of 6.6% year-over-year, and net profit attributable to shareholders was 88.505 million yuan, up 8.07% year-over-year. Looking at quarterly data, in the fourth quarter, total operating revenue was 136 million yuan, up 2.14% year-over-year, while net profit attributable to shareholders was 15.039 million yuan, down 4.11%. During this period, Sealing Technology’s profitability improved, with gross profit margin increasing by 4.49% and net profit margin rising by 1.37% year-over-year.

The financial data indicators released in this report are generally favorable. The gross profit margin is 30.97%, up 4.49% year-over-year; net profit margin is 15.76%, up 1.37%. Total selling, administrative, and financial expenses amounted to 35.466 million yuan, accounting for 6.32% of revenue, an increase of 2.08%. Net asset value per share is 6.69 yuan, up 4.69%; operating cash flow per share is 0.68 yuan, up 29.04%; earnings per share are 0.6 yuan, an increase of 7.14%.

The explanations for significant changes in certain financial items are as follows:

1. Net cash flow from operating activities changed by 29.04%, due to reduced payments based on credit terms.
2. Net cash flow from investing activities changed by 728.65%, due to increased redemption of maturing financial products.
3. Net cash flow from financing activities changed by 11.43%, due to decreased cash dividends distributed in 2025.
4. Construction in progress increased by 3845.55%, due to more unapproved factory and production line equipment.
5. Prepaid expenses increased by 5218.63%, due to higher prepayments at the end of the period.
6. Other receivables decreased by 100.0%, due to a reduction in petty cash at period-end.
7. Other current assets increased by 458.91%, due to higher deductible taxes.
8. Notes payable decreased by 55.9%, due to fewer bank acceptance bills issued.
9. Accounts payable increased by 51.49%, due to higher amounts owed to suppliers.

Securities Star’s financial analysis tools show:

• Business Evaluation: The company’s ROIC last year was 7.98%, indicating an average capital return rate. The net profit margin was 15.76%, suggesting high added value for products or services after all costs. Historically, since listing, the median ROIC is 13.99%, with relatively good investment returns, though 2015 was notably poor with a ROIC of -2.05%. The company’s financials are generally solid (note: the company has been listed for less than 10 years; the longer the listing, the more meaningful the financial averages). Since going public, there have been four annual reports, with one loss year—worth examining for any special reasons.
• Debt-paying Ability: The company’s cash assets are very healthy.
• Business Breakdown: Over the past three years (2023/2024/2025), net return on operating assets was 41.1%, 50.6%, and 43.5%, respectively. Net operating profits were 72.36 million, 81.89 million, and 88.51 million yuan; net operating assets were 176 million, 162 million, and 203 million yuan.

Operating capital to revenue ratios over these three years were 0.24, 0.20, and 0.21, respectively, with operating capital (funds invested by the company in production) at 125 million, 104 million, and 115 million yuan, and revenue at 512 million, 527 million, and 562 million yuan.

Financial health check tools recommend paying attention to the company’s accounts receivable status (accounts receivable/profit ratio reaching 165.76%).

Recent attention from well-known institutions includes:

Question: What are the main topics discussed during the activity?

Answer: In the automotive sector, metal-coated gasket plates have broad market potential in sealing and damping/noise reduction in brake systems. Currently, most high-end domestic markets are dominated by imports. The company’s metal-coated gasket plates are made from stainless steel and other metals as substrates, coated with nitrile rubber, fluororubber, etc., as high-performance composite materials. They can be used to manufacture high-end engine sealing gaskets, transmission gaskets, compressor gaskets, and general gasoline engine gaskets. They are also suitable for making brake noise reduction plates and retaining rings. The downstream industry includes not only commercial vehicles but the entire automotive sector, such as brake system noise reduction and retaining rings, applicable to all disc brake systems in cars and new energy vehicles. Besides the annual demand from millions of new cars, there are hundreds of millions of vehicles in the maintenance market, making future market space far beyond diesel engine gaskets.

Question: How are the company’s current orders?

Answer: Orders are normal, maintaining a good trend from last year. The company emphasizes market development, actively mobilizing technical, administrative, and production staff to assist sales, continuously developing new customers while maintaining existing market share. For metal-coated gasket plates, preparations are underway for new production lines. In the new year, the company plans to focus on technological innovation and strict quality control to secure more orders.

Question: What are the competitive advantages of the company’s products in the market?

Answer: In recent years, the company’s sealing gasket business has closely followed the development of major OEMs, engaging in synchronized R&D. Through industry-leading technology and product consistency, the company has gained customer trust, increasing market share. After years of steady operation and reputation building, the company remains a leader in its niche. The metal-coated gasket business mainly faces competition from imports. After years of R&D, the company’s products now approach international advanced levels, with competitive pricing and high cost-performance. Based on engine sealing technology, the company will accelerate layout in new energy vehicle sealing and precision processing, while expanding into transmission, pump, heat exchange, and refrigeration sealing fields.

Question: How is the company’s business in the new energy vehicle sector in 2025, and what is its revenue share?

Answer: The company continues to focus on the new energy vehicle market, supplying multiple categories such as extended-range and hybrid models to several leading new energy automakers. The sealing business for hybrid and extended-range models has grown rapidly. However, due to low per-vehicle value and small base, the revenue share remains relatively low.

Question: Will the delay of the “Sealing Gasket Technology Upgrade and Expansion Project” affect the company?

Answer: The project aims to expand capacity and upgrade technology for sealing gaskets. Since the company’s IPO, the commercial vehicle industry has experienced notable fluctuations. Facing a complex market environment, the company prioritizes actual demand, actively adjusts project implementation pace, and enhances technological upgrades to improve product competitiveness, avoiding overcapacity risks. Overall, in 2025, the company’s sealing gasket business performed well and was not impacted by the project delay.

Question: How is the company’s export situation, and are there plans to expand overseas markets?

Answer: The company has been actively developing international markets in recent years. Indirect exports follow downstream OEMs’ engine and vehicle exports, but data is difficult to track. Direct exports involve supplying products to well-known global OEMs like Cummins (USA), Doosan (Korea), and developing overseas clients in Russia, India, Korea, Italy, etc. Export revenue is expected to grow significantly this year. As the company’s technology and product competitiveness improve, its reputation in the industry increases. The company’s R&D capabilities and product consistency have been recognized by many international brands. With the implementation of its internationalization strategy, future overseas markets are expected to strongly support the company’s performance.

The above content is compiled from publicly available information by Securities Star, generated by AI algorithms (NetTrust Backup 310104345710301240019), and does not constitute investment advice.