Shuhua Sports (605299) 2025 Annual Report Brief Analysis: Revenue growth without profit increase, company accounts receivable are relatively large

According to publicly available data compiled by Securities Star, Shuhua Sports (605299) recently released its 2025 annual report. As of the end of this reporting period, the company’s total operating revenue was 1.566 billion yuan, an increase of 10.53% year-over-year, and net profit attributable to shareholders was 89.21 million yuan, a decrease of 1.24% year-over-year. Looking at quarterly data, in the fourth quarter, total operating revenue was 558 million yuan, up 8.84% year-over-year, and net profit attributable to shareholders was 53.66 million yuan, up 35.8% year-over-year. During this reporting period, Shuhua Sports had a large accounts receivable balance, with accounts receivable accounting for 402.72% of the latest annual net profit attributable to shareholders.

This figure is below most analysts’ expectations, who previously forecasted a net profit of around 98 million yuan for 2025.

The financial data released in this report shows average performance. Among them, gross profit margin is 30.69%, up 0.44% year-over-year; net profit margin is 5.7%, down 10.65% year-over-year; total sales, management, and financial expenses amount to 277 million yuan, accounting for 17.69% of revenue, down 5.8% year-over-year; net assets per share are 3.11 yuan, down 0.04 yuan; operating cash flow per share is 0.26 yuan, down 1.74%; earnings per share are 0.22 yuan.

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

1. Financial expenses changed by -6345.73%. Reason: Due to an increase in the amount of large-term deposit certificates held compared to the same period last year, interest income increased by 6.28 million yuan, a 273.46% rise.
2. Net cash flow from investing activities changed by -61.46%. Reason: Cash received from investment income decreased by 15.26 million yuan compared to the same period last year, leading to a decrease of 10.56 million yuan in net cash flow from investing activities.
3. Trading financial assets changed by -100.0%. Reason: Trading financial assets matured during this period, with no subsequent purchases.
4. Notes receivable changed by -52.19%. Reason: The amount settled by customers through notes decreased this period.
5. Prepaid expenses changed by 34.44%. Reason: An increase in orders settled with prepayments at the end of this period.
6. Contract assets changed by -37.96%. Reason: Recovery of previous warranty deposits during this period.
7. Non-current assets due within one year changed by 103.68%. Reason: An increase in orders settled through long-term receivables.
8. Long-term receivables changed by 143.11%. Reason: An increase in orders settled through long-term receivables.
9. Investment properties changed by 35.47%. Reason: New external operating lease assets during this period.
10. Intangible assets changed by 44.0%. Reason: Purchase of land use rights for G2023-3 land parcel in Jinjiang City.
11. Long-term deferred expenses changed by 76.66%. Reason: Increase in the number of new fitness store openings, leading to higher long-term deferred renovation costs.
12. Other non-current assets changed by -61.48%. Reason: Decrease in prepayments for equipment compared to the same period last year.
13. Notes payable changed by 273.41%. Reason: Increase in payments settled via bank acceptance bills compared to the same period last year.
14. Contract liabilities changed by 36.23%. Reason: Increase in orders received but not yet fulfilled at the end of this period.
15. Non-current liabilities due within one year changed by 40.04%. Reason: Increase in the number of new fitness stores and corresponding external operating leases.

Securities Star’s valuation analysis tools indicate:

• Business Evaluation: The company’s ROIC last year was 5.61%, generally indicating average capital returns. The net profit margin last year was 5.7%. After accounting for all costs, the company’s products or services have moderate added value. Historically, since listing, the median ROIC is 11.66%, indicating relatively good investment returns, though 2025’s ROIC of 5.61% is average. The company’s historical financial reports are relatively average (Note: The company has been listed for less than 10 years; the longer the listing, the more meaningful the financial averages).

• Business Model: The company’s performance mainly relies on marketing-driven growth. It is necessary to carefully analyze the actual drivers behind this.

• Business Breakdown: Over the past three years (2023/2024/2025), net operating asset return rates were 13.1%, 9.4%, and 8.9%, respectively. Net operating profits were 129 million, 90.33 million, and 89.21 million yuan, respectively. Net operating assets were 982 million, 961 million, and 1 billion yuan.

  Over the past three years, (2023/2024/2025), working capital/revenue ratios were 0.17, 0.19, and 0.19, respectively, with working capital (funds invested by the company in operations) at 242 million, 272 million, and 299 million yuan, and revenue at 1.422 billion, 1.417 billion, and 1.566 billion yuan.

Financial report analysis tools suggest:

1. Pay close attention to the company’s accounts receivable status (accounts receivable/profit ratio has reached 402.72%).

The above content is compiled by Securities Star based on publicly available information and generated by AI algorithms (Net Xin Suan Bei 310104345710301240019). It does not constitute investment advice.