Breaking Down JiaoZuo WanFang Aluminum Manufacturing Co., Ltd Financial Health: Key Insights for Investors

Jiaozuo WanFang Aluminum Manufacturing Co., Ltd (000612.SZ) delivers compelling mid-2025 figures that demand a closer look: operating revenue of 3.309 billion yuan in H1 (+5.34% YoY) and net profit attributable to shareholders of 536 million yuan (+49.06% YoY), while the first three quarters showed 4.982 billion yuan revenue (+4.03% YoY) and 906 million yuan net profit (+71.58% YoY); its TTM revenue is 6.66 billion yuan with TTM net income of 966.64 million yuan, market cap stands at 11.53 billion yuan (P/S 1.71, P/E 11.92), balance-sheet strengths include cash and equivalents of 1.70 billion yuan versus total debt of 643.1 million yuan, a debt-to-equity of 0.06 (5.6% over five years), current ratio 2.60 and interest coverage 50.60, and strategic moves - a planned 3.8 billion yuan investment in a 400,000-ton secondary aluminum project plus a 99.4% stake acquisition in Sanmenxia - that intersect with risks like raw-material price volatility and tightening emissions rules; read on for the full financial breakdown and investor takeaway.

JiaoZuo WanFang Aluminum Manufacturing Co., Ltd (000612.SZ) - Revenue Analysis

• Operating revenue (H1 2025): 3.309 billion yuan, +5.34% YoY.
• Net profit attributable to shareholders (H1 2025): 536 million yuan, +49.06% YoY.
• Operating revenue (first three quarters 2025): 4.982 billion yuan, +4.03% YoY.
• Net profit attributable to shareholders (first three quarters 2025): 906 million yuan, +71.58% YoY.
• TTM revenue: 6.66 billion yuan; TTM net income: 966.64 million yuan.
• Market capitalization: 11.53 billion yuan; P/S ratio: 1.71.

• Revenue growth is positive but modest (H1 +5.34%, Q1-3 +4.03%); profitability improvement is pronounced (H1 net +49.06%, Q1-3 net +71.58%), indicating margin expansion or better cost control.
• TTM margins: net income of 966.64 million on 6.66 billion revenue implies an approximate net margin of 14.5%.
• P/S of 1.71 on a market cap of 11.53 billion suggests market valuation pricing moderate growth with current profitability reflected.

JiaoZuo WanFang Aluminum Manufacturing Co., Ltd (000612.SZ) - Profitability Metrics

• Net profit (H1 2025): ¥536 million; Revenue (H1 2025): ¥3,309 million → net profit margin ≈ 16.2% (536/3,309).
• Reported alternative net profit margin: 11.5% (company-disclosed or period-comparable figure).
• Return on equity (ROE): 14.68% (primary reported); an alternate reported ROE figure is 11.5% (period/segment-based).
• Return on assets (ROA): 7.23%.
• Operating income (H1 2025): ¥561.7 million; Operating expenses: ¥76.8 million.
• Earnings per share (EPS) - first three quarters 2025: ¥0.76, up from ¥0.443 in the same period last year.

• Improvement in EPS (0.76 vs 0.443) signals stronger bottom-line per-share performance year-over-year.
• Operating margin implied by operating income vs operating expenses indicates operating leverage (¥561.7M income vs ¥76.8M expenses).
• Discrepancies between calculated and reported margins/ROE suggest period, nonrecurring items, or accounting adjustments; investors should reconcile H1 vs full-period disclosures.

JiaoZuo WanFang Aluminum Manufacturing Co., Ltd (000612.SZ) - Debt vs. Equity Structure

• Total cash & equivalents: 1.70 billion yuan versus total debt: 643.1 million yuan - cash exceeds debt by ~1.06 billion yuan.
• Debt-to-equity ratio: 0.06 (5.6%) - a materially low leverage level, down from 24.7% five years ago.
• Interest coverage ratio: 50.60 - ample ability to service interest expenses from operating earnings.
• Current ratio: 2.60 and quick ratio: 1.95 - solid short-term liquidity and near-cash coverage of immediate liabilities.

• Investor implications: low default risk, flexibility for capex/dividends, lower financial risk premium compared with higher‑leveraged peers.
• Potential trade-offs: conservative leverage may dilute potential ROE upside from debt-financed growth; monitor capital allocation choices.
• Watch points: stability of operating earnings (to sustain interest coverage), deployment of excess cash, and any strategic M&A that could alter leverage quickly.

JiaoZuo WanFang Aluminum Manufacturing Co., Ltd (000612.SZ) - Liquidity and Solvency

Key liquidity and solvency metrics for JiaoZuo WanFang Aluminum Manufacturing Co., Ltd (000612.SZ) demonstrate strong short-term coverage, minimal leverage, and ample cash reserves relative to obligations.

• Current ratio: 2.60 - indicates good short-term financial health.
• Quick ratio: 1.95 - reflects adequate liquidity to cover immediate liabilities without relying on inventory conversion.
• Cash and equivalents: ¥1.70 billion - substantially exceeds total debt of ¥643.1 million.
• Interest coverage ratio: 50.60 - suggests a very strong ability to meet interest obligations from operating earnings.
• Debt-to-equity ratio: 0.06 (6.0%) - low level of debt relative to equity.
• Five-year change in debt-to-equity: down from 24.7% to 5.6% - indicating materially reduced financial leverage.

For broader context on the company's background and business model, see: JiaoZuo WanFang Aluminum Manufacturing Co., Ltd: History, Ownership, Mission, How It Works & Makes Money

JiaoZuo WanFang Aluminum Manufacturing Co., Ltd (000612.SZ) - Valuation Analysis

• P/E of 11.92 places the company in a modest earnings valuation band - cheaper than many industrial peers trading >15x.
• P/S of 1.71 (market cap vs. revenue) signals the market pays roughly 1.7 yuan for each yuan of sales.
• EV/EBITDA at 9.16 and implied EBITDA ≈1.11 billion indicate operating profitability that supports current EV.
• P/FCF ~19 implies free cash flow is positive but not abundant; implied FCF ≈605 million yuan.
• P/B of 1.65 shows limited premium over book value (implied book ≈6.99 billion yuan).

• Key valuation cross-checks:
  • Net margin ~14.5% supports earnings-based P/E.
  • EBITDA and FCF metrics together suggest solid operating cash conversion but a moderate premium on cash flows.

JiaoZuo WanFang Aluminum Manufacturing Co., Ltd (000612.SZ) - Risk Factors

• Intense global competition: the global aluminum market is projected at $224 billion by 2027, increasing pressure from lower-cost producers in emerging markets and compressing margins.
• Regulatory and environmental compliance: stricter emissions standards and decarbonization expectations (industry target: 30% carbon reduction by 2030) may require capital expenditure and process upgrades.
• Raw material price volatility: primary aluminum prices have ranged from $2,250 to $2,800 per metric ton recently, creating earnings volatility and inventory revaluation risk.
• Supplier concentration: dependence on a limited supplier base has coincided with a ~20% increase in procurement costs, raising operational risk and input-cost sensitivity.
• Leverage and financing cost risk: a debt-to-equity ratio of 1.5 signals moderate financial leverage; combined with a rising average corporate loan rate in China (currently ~5.2%), interest expense sensitivity is elevated.

• Cash-flow sensitivity: with procurement up and prices volatile, free cash flow can swing materially quarter-to-quarter, affecting covenant compliance risk given 1.5 leverage.
• Capex and modernization burden: meeting emissions targets likely requires multi-year capex; timing and funding choices will influence credit metrics and shareholder returns.
• Market-share risk: sustained price competition from lower-cost regions could force price reductions or require strategic repositioning toward value-added products.
• Supplier disruption risk: concentration raises the possibility of single-point failures (logistics, quality or price), necessitating sourcing diversification or inventory cushions.

JiaoZuo WanFang Aluminum Manufacturing Co., Ltd (000612.SZ) - Growth Opportunities

• 400,000-ton secondary aluminum project: ~RMB 3.8 billion investment to expand recycled-aluminum capacity and improve margins.
• Acquisition of 99.4% stake in Sanmenxia Aluminum: upstream integration to secure feedstock and improve supply-chain resilience.
• Product portfolio expansion: planned additions of 100,000 tons of round bars and 75,000 tons of alloy ingots to address diversified end-market demand.
• Green technology investments: capital allocation toward emission controls, energy efficiency and waste-heat recovery to comply with stricter environmental regulations and reduce operating costs long-term.

• Increased annual output and improved product mix are projected to lift revenue per ton through higher-value round bars and alloy ingots.
• Upstream control via Sanmenxia Aluminum is expected to stabilize raw-material costs and margins by securing feedstock and reducing spot-price exposure.
• Green investments reduce regulatory risk and may enable longer-term cost savings from energy efficiency and potential carbon-related incentives.
• Entry and scale in the secondary aluminum market aligns with global trends favoring recycled aluminum, potentially increasing market share in domestic and export channels.