Shanghai Electric Q1 net profit soared 145.7%, gross profit from main business increased | Financial report insights

Shanghai Electric's performance in the first quarter showed significant recovery, with operating revenue increasing by 8.06% year-on-year and net profit soaring by 145.69% year-on-year, turning non-recurring net profit from loss to profit.

On Monday evening, Shanghai Electric released its financial report for the first quarter of 2025, with the following key points:

• Significant performance improvement: Q1 net profit attributable to shareholders reached 292 million yuan, a year-on-year increase of 145.7%; total operating revenue was 22.245 billion yuan, a year-on-year increase of 8.1%
• Profitability significantly enhanced: Non-recurring net profit attributable to shareholders turned from a loss of 120 million yuan in the same period last year to a profit of 205 million yuan
• Improvement in operating cash flow: Net cash outflow from operating activities was 3.87 billion yuan, a decrease of about 3.07 billion yuan compared to the same period last year
• Optimization of business structure: Gross profit from main business increased, driving overall performance improvement, with clear advantages in new energy, intelligent manufacturing, and other fields

Steady Development of Main Business, Improvement in Gross Profit and Operational Efficiency

This performance improvement is mainly attributed to the steady development of the company's main business. During the reporting period, the company's main business revenue and gross profit increased compared to the same period last year, driving basic earnings per share to reach 0.0188 yuan, a year-on-year increase of 147.37%. At the same time, although the net cash flow generated from operating activities remained negative (-3.87 billion yuan), it showed significant improvement compared to the same period last year (-6.938 billion yuan), indicating that the company has improved its operational status and capital utilization efficiency.

The core reason for the improvement in profitability partly stems from the structural adjustments and asset optimization by the company's management: inventory increased from 3.455 billion yuan to 3.963 billion yuan, reflecting pressure from project advancement and increased stocking; accounts receivable remained relatively stable, indicating that the collection of receivables is acceptable, but the amount of funds allocated decreased from 26.2 billion yuan to 16.4 billion yuan, which can be seen as the company's efforts to optimize asset structure and reduce liquidity risk.

It is noteworthy that the company achieved investment income of 514 million yuan in the first quarter, a year-on-year increase of 13%, of which investment income from joint ventures and associates reached 398 million yuan, an increase of 36.6% compared to the same period last year, showing the effectiveness of the company's investment layout is beginning to emerge. In addition, the company's credit impairment losses and asset impairment losses totaled about 151 million yuan, a decrease from 209 million yuan in the same period last year.

Asset-Liability Structure Remains Stable, Operating Cash Flow Continues to Improve

As of the end of the first quarter of 2025, Shanghai Electric's total assets reached 300.474 billion yuan, a slight decrease of 0.67% compared to the end of the previous year, but overall remained stable. The equity attributable to shareholders of the listed company was 53.559 billion yuan, an increase of 0.69% compared to the end of the previous year, and the financial structure continues to maintain a healthy state. On the liability side, short-term borrowings slightly increased (955 million yuan), but overall current liabilities remain large (18.82 billion yuan), indicating continued liquidity pressure. From a cash flow perspective, although there was still a net cash outflow from operating activities in the first quarter, the scale of outflow has significantly decreased compared to the same period last year, indicating an improvement in the company's cash flow management capabilities. In terms of investment activities, the company had a net outflow of 2.924 billion yuan, a significant change from a net inflow of 829 million yuan in the same period last year, mainly due to the company making payments of 1.441 billion yuan for the acquisition of subsidiaries and other operating units during the period.

As a leading comprehensive equipment manufacturing group in China, Shanghai Electric occupies an important position in the fields of energy equipment, industrial equipment, and integrated services. The company's asset scale exceeds 300 billion yuan, and beyond traditional energy equipment, it is also actively expanding into new energy, high-end equipment manufacturing, and intelligent manufacturing to address the challenges and opportunities brought by energy transformation and industrial upgrading. However, investors still need to pay attention to several key issues: first, the development of the company's overseas business as global economic uncertainty increases; second, the pressure for transformation and upgrading in the energy equipment sector; and third, the competitive strategies in the high-end manufacturing sector against international giants