Eagle Eye Warning: Haohai Biological's Return on Net Assets has decreased significantly

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

On March 20, Haohai Biotechnology released its 2025 annual report.

The report shows that the company’s operating revenue for the full year of 2025 was 2.473 billion yuan, a year-over-year decrease of 8.33%; net profit attributable to shareholders was 251 million yuan, a year-over-year decrease of 40.3%; non-recurring profit and loss attributable to shareholders was 160 million yuan, a year-over-year decrease of 57.67%; and basic earnings per share were 1.08 yuan per share.

Since it went public in October 2019, the company has made cash dividends 8 times, with cumulative cash dividends already implemented of 891 million yuan.

The listed company financial report eagle-eye early-warning system conducts intelligent quantitative analysis of Haohai Biotechnology’s 2025 annual report across four major dimensions: performance quality, profitability, capital pressure and safety, and operating efficiency.

I. Performance Quality

During the reporting period, the company’s revenue was 2.473 billion yuan, a year-over-year decrease of 8.33%; net profit was 208 million yuan, a year-over-year decrease of 44.63%; and net cash flow from operating activities was 491 million yuan, a year-over-year decrease of 24.3%.

From the overall performance perspective, key items to focus on:

• Revenue growth continues to decline. In the past three periods’ annual reports, the year-over-year changes in revenue were 24.59%, 1.64%, and -8.33%, respectively, with the trend continuing downward.

• Growth rate of net profit attributable to shareholders continues to decline. In the past three periods’ annual reports, the year-over-year changes in net profit attributable to shareholders were 130.58%, 1.04%, and -40.3%, respectively, with the trend continuing downward.

• Growth rate of non-recurring profit and loss attributable to shareholders continues to decline. In the past three periods’ annual reports, the year-over-year changes in non-recurring profit and loss attributable to shareholders were 141.52%, -1.12%, and -57.67%, respectively, with the trend continuing downward.

II. Profitability

During the reporting period, the company’s gross margin was 70.13%, up 0.36% year over year; net profit margin was 8.42%, down 39.6% year over year; and return on net assets (weighted) was 4.53%, down 38.95% year over year.

Based on the company’s operating end, key items to focus on:

• Sales net profit margin is fairly volatile. During the reporting period, the company’s sales net profit margin for Q1 to Q4 were 13.55%, 1.91%, 0.05%, and -7.08%, respectively; year-over-year changes were -5.36%, 61.84%, -116.98%, and 452.24%, respectively, indicating significant volatility in sales net profit margin.

| Item | 20250331 | 20250630 | 20250930 | 20251231 | | Sales net profit margin | 13.55% | 1.91% | 0.05% | -7.08% | | Sales net profit margin growth rate | -5.36% | 61.84% | -116.98% | 452.24% |

• Sales net profit margin continues to decline. In the past three periods’ annual reports, the sales net profit margin was 15.53%, 13.95%, and 8.42%, respectively, with the trend continuing downward.

• Gross margin increases, while sales net profit margin declines. During the reporting period, the sales gross margin increased from 69.88% in the same period last year to 70.13%, while the sales net profit margin decreased from 13.95% in the same period last year to 8.42%.

Based on the company’s asset side, key items to focus on:

• Return on net assets declines markedly. During the reporting period, the weighted average return on net assets was 4.53%, a significant year-over-year decrease of 38.95%.

• Average return on net assets over the last three years is below 7%. During the reporting period, the weighted average return on net assets was 4.53%, and the average weighted average return on net assets for the most recent three accounting years was below 7%.

• Return on invested capital is below 7%. During the reporting period, the company’s return on invested capital was 4.56%, and the average value over the three reporting periods was below 7%.

III. Unusual Gains and Losses

From non-recurring gains and losses, key items to focus on:

• Cash inflows from disposing of equity or assets are relatively large. During the reporting period, the company’s net cash inflows from disposing of equity interests in subsidiaries, real estate, and so on, as a ratio of net profit, was 41.52%.

| Item | 20231231 | 20241231 | 20251231 | | Asset or equity disposal cash inflows (yuan) | - | - | 86.49 million | | Net profit (yuan) | 412 million | 376 million | 208 million | | Asset or equity disposal cash inflows / net profit | - | - | 41.52% |

IV. Whether There Is an Impairment Risk

From whether there is a risk of impairment, key items to focus on:

• Goodwill fluctuation rate exceeds 30%. During the reporting period, the goodwill balance was 270 million yuan, and the change rate compared with the beginning of the period was -35.9%.

• Year-over-year change rate of asset impairment losses exceeds 30%. During the reporting period, asset impairment losses were -200 million yuan, a year-over-year decrease of 515.78%.

| Item | 20231231 | 20241231 | 20251231 | | Asset impairment losses (yuan) | -6.7409 million | -32.2384 million | -199 million |

V. Customer Concentration and Minority Shareholders

From dimensions such as customer concentration and minority shareholders, key items to focus on:

• Losses attributable to minority shareholders are negative, while net profit attributable to shareholders is positive. During the reporting period, losses attributable to minority shareholders were -40 million yuan, while net profit attributable to shareholders was 250 million yuan.

| Item | 20231231 | 20241231 | 20251231 | | Losses attributable to minority shareholders (yuan) | -3.8521 million | -44.2036 million | -42.6872 million | | Net profit attributable to shareholders (yuan) | 416 million | 420 million | 251 million |

III. Capital Pressure and Safety

During the reporting period, the company’s asset-liability ratio was 16.6%, down 1.84% year over year; the current ratio was 3.79, and the quick ratio was 3.21; total debt was 368 million yuan, of which short-term debt was 335 million yuan, and short-term debt as a percentage of total debt was 91%.

From the overall financial position, key items to focus on:

• Current ratio continues to decline. In the past three periods’ annual reports, the current ratio was 5.24, 4.22, and 3.79, respectively, indicating weakening short-term solvency capacity.

From short-term capital pressure, key items to focus on:

• Short- and long-term debt ratio continues to grow. In the past three periods’ annual reports, the ratio of short-term debt to long-term debt was 1.38, 2.17, and 5.24, respectively, showing an upward trend in the short- and long-term debt ratio.

• Cash ratio continues to decline. In the past three periods’ annual reports, the cash ratio was 3.53, 2.92, and 2.76, respectively, continuing to decline.

• Net cash flow from operating activities / current liabilities continues to decline. In the past three periods’ annual reports, the ratio of net cash flow from operating activities to current liabilities was 0.89, 0.75, and 0.54, respectively, continuing to decline.

From the perspective of capital management and control, key items to focus on:

• Prepayments to suppliers / current assets ratio continues to grow. In the past three periods’ annual reports, the ratio of prepayments to suppliers / current assets was 1.39%, 1.44%, and 1.53%, respectively, continuing to increase.

• The growth rate of prepayments to suppliers is higher than the growth rate of operating costs. During the reporting period, prepayments to suppliers increased by 0.14% compared with the beginning of the period; operating costs grew by -9.09% year over year; the growth rate of prepayments to suppliers was higher than that of operating costs.

| Item | 20231231 | 20241231 | 20251231 | | Prepayments to suppliers growth rate vs. beginning of period | -10.89% | 1.03% | 0.14% | | Operating costs growth rate | 18.48% | 3.8% | -9.09% |

• Other receivables change significantly. During the reporting period, other receivables were 60 million yuan, with a change rate of 32.66% compared with the beginning of the period.

• The ratio of other receivables / current assets continues to increase. In the past three periods’ annual reports, the ratio of other receivables / current assets was 0.6%, 1.23%, and 1.73%, respectively, continuing to rise.

From the perspective of capital coordination, key items to focus on:

• Short-term debt pressure continues to grow, and financing channels are tightening. In the past three periods’ annual reports, the ratios of short- and long-term debt were 1.38x, 2.17x, and 5.24x respectively, continuing to grow; the net cash flow from financing activities was -2.6 billion yuan, -3.9 billion yuan, and -5.8 billion yuan respectively, continuing to decline.

| Item | 20231231 | 20241231 | 20251231 | | Net cash flow from financing activities (yuan) | -258 million | -390 million | -581 million | | Short-/long-term debt ratio | 0.35 | 1.38 | 2.8 |

IV. Operating Efficiency

During the reporting period, the company’s accounts receivable turnover rate was 8.42, up 0.55% year over year; inventory turnover rate was 1.46, down 8.79% year over year; and total asset turnover rate was 0.36, down 5.78% year over year.

From long-term assets, key items to focus on:

• Construction in progress exceeds fixed assets. During the reporting period, construction in progress was 1.02 billion yuan, fixed assets were 710 million yuan, and construction in progress exceeded fixed assets.

• Other non-current assets change significantly. During the reporting period, other non-current assets were 90 million yuan, up 237.64% from the beginning of the period.

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