Hong Kong-listed Nanfang Communication Holdings Limited released its audited results for the year ended 31 December 2025, showing lower top- and bottom-line figures but a notable recovery in profitability at the gross level.
Financial performance • Revenue fell 13.73 % year on year to RMB 464.17 million, reflecting softer demand for optical-fibre cables, optical distribution network devices and pre-painted steel sheet. • Gross profit edged up 5.44 % to RMB 103.83 million as raw-material costs eased. Gross margin widened to 22.4 % from 18.3 %. • Profit attributable to shareholders declined 23.90 % to RMB 30.39 million, and basic EPS slipped to RMB 0.019 from RMB 0.025. • The board proposed no final dividend, unchanged from the prior year.
Cost and expense dynamics • Cost of sales dropped 18.05 % to RMB 360.34 million, underpinning the margin rebound. • Other income and gains contracted to RMB 8.14 million (2024: RMB 19.48 million) amid lower bank interest income and reduced government subsidies. • Selling and distribution expenses declined 4.96 % to RMB 17.41 million, while administrative expenses rose 25.31 % to RMB 43.48 million, partly due to higher depreciation after new facilities came on stream. • Research costs were trimmed 11.66 % to RMB 29.32 million. • Net finance costs inched up 3.35 % to RMB 6.20 million. • Contributions from associates and a joint venture increased to RMB 11.07 million and RMB 3.87 million, respectively.
Balance-sheet highlights • Total assets stood at RMB 1.33 billion, with cash, bank deposits and restricted balances of RMB 421.75 million, up 4.08 % from end-2024. • Interest-bearing bank borrowings were cut to RMB 179.21 million from RMB 360.34 million. • Net current assets improved to RMB 497.82 million (2024: RMB 380.22 million); gearing ratio (total liabilities/total equity) eased to 56.6 % from 84.5 %. • The group pledged RMB 160.30 million in restricted deposits to secure bills payable and loans.
Post-balance-sheet developments • On 24 October 2025 the group completed the disposal of its 4 % stake (8.24 million Class A preferred shares) in Source Photonics Holdings (Cayman) for USD 25.18 million (about RMB 180.80 million). • In February 2026 the subsidiary Jiangsu Nanfang Communication Technology signed a RMB 38.25 million construction contract for the Nanfang Science and Technology Ecological Industrial Park redevelopment in Changzhou, with an additional RMB 2.10 million infrastructure fee due by end-February 2026.
Operational context and outlook Management noted a tightening global supply-demand balance for optical-fibre cables from 2H 2025, supported by AI-driven computing-power expansion and overseas broadband initiatives. CRU projects 5 % growth in 2026 global cable demand to 577 million fibre-km against sub-3 % supply growth. Nanfang plans to boost R&D spending on high-speed interconnect and eco-friendly cable products, expand data-centre and non-operator customer segments, and enhance cost control through intelligent manufacturing and supply-chain optimisation.
Governance updates During 2025 the board filled vacancies created by the passing of an independent non-executive director, restoring compliance with Hong Kong Listing Rules on board and committee composition. The company affirmed adherence to the Corporate Governance Code throughout the year, with one continuing director serving beyond nine years subject to annual re-election.
The annual general meeting is scheduled for 24 June 2026; the register of members will be closed from 18 to 24 June 2026 for voting eligibility.
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