Eagle Eye Warning: The ratio of net cash flow from operating activities to net profit for Times Electric is less than 1

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

On March 28, TDK Corporation released its 2025 annual report. The audit opinion was a standard unqualified audit opinion.

The report shows that the company’s operating revenue for 2025 was 28.703 billion yuan, up 15.23% year over year; net profit attributable to shareholders was 4.097 billion yuan, up 10.64% year over year; net profit attributable after non-recurring items was 3.9 billion yuan, up 20.91% year over year; and basic earnings per share were 2.99 yuan per share.

Since the company’s listing in August 2021, it has paid cash dividends 6 times. The cumulative cash dividends implemented were 5.11 billion yuan. The announcement shows that the company plans to distribute a cash dividend of 6.8 yuan for every 10 shares to all shareholders (including tax).

The Listed Company Financial Report Eagle-Eye Alert System conducts intelligent quantitative analysis of TDK Corporation’s 2025 annual report from four major dimensions: performance quality, profitability, capital pressure and safety, and operating efficiency.

I. Performance Quality

In the reporting period, the company’s revenue was 28.703 billion yuan, up 15.23%; net profit was 4.309 billion yuan, up 9.12%; and net cash flow from operating activities was 3.965 billion yuan, up 17.96%.

Judging from the overall performance, it is necessary to focus on:

• The year-over-year growth rate of net profit attributable after non-recurring items continues to decline. In the past three annual reports, the year-over-year changes in net profit attributable after non-recurring items were 29.89%, 24.28%, and 20.91% respectively, and the downward trend has continued.

Judging from the ratio of revenue, cost, and period expenses, it is necessary to focus on:

• The change in selling expenses differs greatly from the change in operating revenue. In the reporting period, operating revenue changed by 15.23% year over year, selling expenses changed by -0.38% year over year, and the difference between the changes in selling expenses and operating revenue is large.

In combination with the quality of operating assets, it is necessary to focus on:

• The growth rate of notes receivable is higher than the growth rate of operating revenue. In the reporting period, notes receivable increased by 64.18% compared with the beginning of the period, operating revenue grew 15.23% year over year, and the growth rate of notes receivable is higher than that of operating revenue.

• Inventory growth rate is higher than the growth rate of operating costs. In the reporting period, inventory increased by 23.25% compared with the beginning of the period, operating costs increased by 13.61% year over year, and the inventory growth rate is higher than the operating cost growth rate.

• Inventory growth rate is higher than the growth rate of operating revenue. In the reporting period, inventory increased by 23.25% compared with the beginning of the period, operating revenue grew 15.23% year over year, and the inventory growth rate is higher than that of operating revenue.

In combination with cash flow quality, it is necessary to focus on:

• The ratio of net cash flow from operating activities to net profit is below 1. In the reporting period, the ratio of net cash flow from operating activities to net profit was 0.92, which is below 1, indicating weaker earnings quality.

II. Profitability

In the reporting period, the company’s gross margin was 33.43%, up 2.93% year over year; the net profit margin was 15.01%, down 5.3% year over year; and return on net assets (weighted) was 9.81%, up 5.37% year over year.

In combination with the company’s operating side and the resulting returns, it is necessary to focus on:

• Growth in selling gross margin, while selling net profit margin declines. In the reporting period, selling gross margin increased from 32.48% in the prior-year period to 33.43%, while selling net profit margin decreased from 15.85% in the prior-year period to 15.01%.

III. Capital Pressure and Safety

In the reporting period, the company’s asset-liability ratio was 36.29%, up 17.35% year over year; the current ratio was 1.7, and the quick ratio was 1.35; total debt was 9.768 billion yuan, including short-term debt of 9.72 billion yuan, and short-term debt accounted for 99.5% of total debt.

From the overall perspective of the financial position, it is necessary to focus on:

• The current ratio continues to decline. In the past three annual reports, the current ratio was 2.79, 2.48, and 1.7 respectively, and short-term solvency continues to weaken.

From the perspective of short-term capital pressure, it is necessary to focus on:

• The cash ratio continues to decline. In the past three annual reports, the cash ratio was 0.97, 0.69, and 0.53 respectively, showing a continuous decline.

• The ratio of net cash flow from operating activities to current liabilities continues to decline. In the past three annual reports, the ratio was 0.21, 0.18, and 0.16 respectively, showing a continuous decline.

From the perspective of capital management, it is necessary to focus on:

• The company’s operating activities cannot meet the capital expenditure funding needs, and financing channels are tightening. In the reporting period, the sum of net cash flow from operating activities and net cash flow from investing activities was -2.56 billion yuan, and net cash flow from financing activities was -0.7 billion yuan. Operating activities cannot cover the funding needs for investing, and financing channels are tightening.

• Capital expenditures continue to exceed net cash inflow from operating activities. In the past three annual reports, cash paid for the purchase and construction of fixed assets, intangible assets, and other long-term assets was 2.98 billion yuan, 3.45 billion yuan, and 4.01 billion yuan respectively. The net cash flow from operating activities was 2.78 billion yuan, 3.36 billion yuan, and 3.96 billion yuan respectively.

IV. Operating Efficiency

In the reporting period, the company’s accounts receivable turnover was 2.4, up 2.98% year over year; inventory turnover was 2.42, down 9.23% year over year; and total asset turnover was 0.42, down 0.18% year over year.

In terms of operating assets, it is necessary to focus on:

• Notes receivable continue to grow. In the past three annual reports, the ratio of notes receivable to current assets was 6.34%, 6.94%, and 12.65% respectively, continuing to rise. The ratio of other cash received related to operating activities to notes receivable was 26.42%, 26.04%, and 12.94% respectively, continuing to decline.

• The ratio of inventory to total assets continues to rise. In the past three annual reports, the ratio of inventory to total assets was 10.19%, 10.9%, and 12.08% respectively, continuing to rise.

In terms of long-term assets, it is necessary to focus on:

• Total asset turnover continues to decline. In the past three annual reports, total asset turnover was 0.43, 0.42, and 0.42 respectively, and the company’s total asset turnover capacity is weakening.

• Fixed assets fluctuate significantly. In the reporting period, fixed assets were 11.39 billion yuan, up 32.58% compared with the beginning of the period.

• Unit fixed-asset revenue production decreases year by year. In the past three annual reports, the ratio of operating revenue to original value of fixed assets was 4.17, 2.9, and 2.52 respectively, showing a continuing decline.

• Construction in progress fluctuates significantly. In the reporting period, construction in progress was 3.46 billion yuan, up 49.75% compared with the beginning of the period.

• Long-deferred expenses change significantly compared with the beginning of the period. In the reporting period, long-deferred expenses were 0.2 billion yuan, up 30.19% compared with the beginning of the period.

• Other non-current assets have a relatively high proportion. In the reporting period, the ratio of other non-current assets to total assets was 15.61%.

• Other non-current assets fluctuate significantly. In the reporting period, other non-current assets were 11.25 billion yuan, up 220.24% compared with the beginning of the period.

Click TDK Corporation’s Eagle-Eye Alert to view the latest alert details and a visual financial report preview.

Sina Finance’s Listed Company Financial Report Eagle-Eye Alert System overview: The listed company financial report Eagle-Eye Alert is an intelligent, professional analytical system for listed companies’ financial reports. Eagle-Eye alerts, by bringing together large numbers of authoritative financial experts from accounting firms and listed companies, track and interpret the latest financial reports of listed companies across multiple dimensions—including company performance growth, earnings quality, capital pressure and safety, and operating efficiency—and present potentially existing financial risk points in both text and image form. It provides professional, efficient, and convenient technical solution for identifying and alerting financial risks of listed companies for financial institutions, listed companies, regulatory authorities, and more.

Eagle-Eye Alert entry: Sina Finance APP—Quotes—Data Center—Eagle-Eye Alerts or Sina Finance APP—Stock Quotes page—Finance—Eagle-Eye Alerts

Disclaimer: The market has risk; investment must be done cautiously. This article is automatically published based on third-party databases and does not represent Sina Finance’s viewpoints. Any information appearing in this article is for reference only and does not constitute personal investment advice. If there are any discrepancies, please refer to the actual announcements. If you have any questions, please contact biz@staff.sina.com.cn.

Massive information and precise interpretation—right in the Sina Finance APP

责任编辑：小浪快报