WOER Q1 2026: Revenue Climbs 15.52%, Profit Slips on Margin Pressure and FX Losses

Shenzhen Woer Heat-Shrinkable Material Co., Ltd. (WOER) reported first-quarter 2026 revenue of 2.03 billion RMB, a 15.52% year-on-year increase driven by continued expansion across communication-cable and materials businesses.

Net profit attributable to shareholders fell 7.63% to 231.29 million RMB, reflecting a 2.07-percentage-point contraction in gross margin to 30.46%. Management cited a weaker product mix—lower contribution from high-voltage power and wind-power segments—alongside raw-material cost inflation that could not be passed through during the period.

Operating expenses outpaced top-line growth: • Selling expenses rose 16.59% to 104.72 million RMB as the company expanded market coverage. • R&D spending increased 21.99% to 114.83 million RMB, supporting new-product development and performance optimisation. • Administrative expenses were up 12.95% to 87.38 million RMB.

Finance costs surged to 31.52 million RMB (up 390.27%) owing to exchange losses from the continued depreciation of the US and Hong Kong dollars against the renminbi.

Despite profit pressure, WOER’s balance sheet strengthened following its February 2026 H-share issuance in Hong Kong, which raised 2.45 billion RMB in gross proceeds. Monetary funds more than doubled to 3.15 billion RMB, while capital reserves expanded to 2.58 billion RMB. Short-term borrowings declined 39.70% to 357.0 million RMB, and total assets increased 19.78% to 14.76 billion RMB.

Net operating cash flow dropped 63.24% to 45.64 million RMB as payments for inventories and services accelerated. Conversely, financing cash inflow reached 2.19 billion RMB, reflecting H-share proceeds, lifting period-end cash and equivalents to 3.12 billion RMB.

Earnings per share declined to 0.1726 RMB (basic), while weighted average ROE fell to 2.60% from 4.44% a year earlier.

As at 31 March 2026, WOER’s total share capital stood at 1.40 billion shares; the largest shareholder, Chairman Zhou Heping and concert parties, held 13.54%.

The company attributes the first-quarter profit decline to margin compression, higher operating expenditure and exchange-rate movements, even as revenue momentum and balance-sheet liquidity improved following its Hong Kong listing.