Shenfire Holdings Sees "Revenue Growth Without Profit Growth" for Second Consecutive Year, 2025 Net Profit Declines 7% YoY Falls Short of Institutional Expectations, Electrolytic Aluminum Business Reaches Full Capacity for First Time and Achieves Production-Sales Balance

Everyday Economic News Reporter | Cai Ding Everyday Economic News Editor | Yang Jun

On the evening of March 23, Shenhuo Co., Ltd. (SZ000933, stock price 29.98 yuan, market value 67.425 billion yuan) disclosed its 2025 annual report. The report shows that in 2025, the company achieved revenue of 41.241 billion yuan, a year-on-year increase of 7.47%; net profit attributable to shareholders of the listed company was 4.005 billion yuan, down 7% year-on-year; non-recurring net profit was approximately 4.075 billion yuan, down 0.94%; basic earnings per share were 1.81 yuan, down 6.22% year-on-year. The company plans to distribute a cash dividend of 8.00 yuan (tax included) per 10 shares based on 22.3358 billion shares after repurchasing shares into dedicated accounts, with no bonus shares or capital increase from reserves.

Image source: Shenhuo Co., Ltd. Annual Report

According to the Daily Economic News reporter, the annual report shows that Shenhuo Co., Ltd. exhibited a “revenue growth but profit decline” trend in 2025, which is the second consecutive year of such a situation (2024 revenue increased by 1.99%, net profit attributable to the parent decreased by 27.07%).

The report indicates that in 2025, Shenhuo Co., Ltd.'s electrolytic aluminum reached full capacity for the first time and achieved production-sales balance. Meanwhile, driven by macroeconomic recovery and improved market expectations, the electrolytic aluminum business achieved a total profit of 7.988 billion yuan, a significant increase of 48.66% year-on-year. Revenue from electrolytic aluminum products reached 28.979 billion yuan, up 11.49%, with a gross profit margin of 30.06%.

In the annual report, Shenhuo Co., Ltd. stated that its battery aluminum foil production ranks second nationwide and first in Henan Province, maintaining a leading position in the new energy market. High-end products such as 4.5-micron ultra-thin double-zero aluminum foil have achieved stable mass production. Additionally, in the aluminum foil business, Shenhuo successfully overcame the technical challenges of ultra-thin capacitor foil rolling, developing and mass-producing 5.3μm ultra-thin capacitor foil and 1235D alloy 8μm double-sided battery foil. This not only broke foreign technological monopoly but also greatly enhanced the company’s core competitiveness and market influence in new energy battery materials.

Despite facing the adverse backdrop of declining coal prices, Shenhuo Co., Ltd. leveraged its dedicated railway lines and regional advantages in East and Central China to accelerate the development of multimodal transport systems, successfully building an efficient, low-cost logistics network, effectively hedging industry profit pressures.

Furthermore, the company relied on the Shenhuo High-Quality Industry Development Fund platform to precisely carry out strategic investments across the industry chain, such as injecting 1 billion yuan into Shenhuo New Materials and investing 329 million yuan in Muluo Zhongping Electric New Energy Co., Ltd., actively deploying in new materials and new energy sectors to cultivate future core profit growth points.

Although 2025 showed many highlights, Shenhuo Co., Ltd. still faces the dilemma of “revenue growth but profit decline” for the second consecutive year.

Image source: Wind

According to data compiled by Wind Financial Terminal, eight institutions’ consensus forecast for Shenhuo Co., Ltd.'s net profit attributable to the parent in 2025 is 5.366 billion yuan, but the company announced a net profit of 4.005 billion yuan, below expectations.

Image source: Wind

From the annual report, it can be seen that the decline in net profit last year was mainly affected by the coal business—due to overall loose supply and demand in the coal market and falling prices, the company’s coal mining revenue was 5.602 billion yuan, a sharp decrease of 18.94%, with gross profit margin dropping significantly to 7.7%.

Image source: Shenhuo Co., Ltd. Annual Report

At the same time, due to mine suspensions, shutdowns, and underperformance, the company recognized asset impairment losses of 1.256 billion yuan. Specifically, Shenhuo reported impairment provisions mainly for its subordinate coal mines: Hecheng Coal Mine 486 million yuan, Damo Ling Coal Mine 444 million yuan, Liuhe Coal Mine 178 million yuan, and Xuehu Coal Mine 146 million yuan. These are the most direct reasons for the full-year net profit decline.

Image source: Shenhuo Co., Ltd. Annual Report

The Daily Economic News reporter noted that due to unpaid debts, Shenhuo’s Hecheng Coal Mine and Damo Ling Coal Mine have been sued by creditors, with some inventories and fixed assets seized or auctioned by courts. This not only caused asset impairments exceeding 1.2 billion yuan but also poses potential legal and debt clearance risks in the future.

On the cost side, Shenhuo reported that operating costs in non-ferrous metal smelting and rolling increased by 8.23% year-on-year, with raw material costs reaching 16.817 billion yuan, up 10.26%. This indicates that the company still faces certain upstream raw material cost inflation pressures.

Shenhuo also disclosed that although electrolytic aluminum achieved full capacity and production-sales balance for the first time last year, it mainly relies on external purchases of raw materials like alumina, which are highly susceptible to upstream price fluctuations. Additionally, compared to industry leaders, the company’s coal resource reserves are relatively limited, with insufficient backup resources.

Cover image source: Sina Finance Media Library