Breaking Down Jiangxi Black Cat Carbon Black Inc.,Ltd Financial Health: Key Insights for Investors

Jiangxi Black Cat Carbon Black's recent numbers paint a tense portrait for investors: quarterly revenue of CNY 2.12 billion (Q3 2025) drove a trailing twelve-month revenue of CNY 9.25 billion, down 7.12% year-over-year as prices and demand faltered, while the company's market capitalization of CNY 8.02 billion sits alongside an enterprise value of CNY 11.42 billion, reflecting heavy leverage-total debt of CNY 2.34 billion and net debt of CNY 1.88 billion-against cash of CNY 461.7 million; profitability metrics oscillate from a 2024 net profit of CNY 25.13 million (gross margin 3.43%) to a recent net loss of CNY 14.14 million with negative free cash flow of CNY 341.50 million, liquidity ratios (current 0.91, quick 0.56) and an Altman Z-Score of 1.92 flagging distress risk, even as productivity shows revenue per employee of CNY 2.15 million across 4,302 staff and growth avenues in carbon nanotubes and conductive carbon black hint at potential upside-read on to unpack what these concrete figures mean for valuation, solvency, and upside potential.

Jiangxi Black Cat Carbon Black Inc.,Ltd (002068.SZ) - Revenue Analysis

• Quarter (Q3 2025) revenue: CNY 2.12 billion (-11.13% YoY)
• TTM revenue (as of Sep 30, 2025): CNY 9.25 billion (-7.12% YoY)
• FY 2024 revenue: CNY 10.13 billion (+7.20% vs. 2023)
• Revenue per employee: CNY 2.15 million (4,302 employees)
• Market capitalization: CNY 7.40 billion; Price-to-Sales (P/S): 0.80

• Material drop in carbon black prices in early 2025.
• Weakened demand linked to trade tensions affecting export volumes.
• Rising inventory levels as sales lag production, pressuring realizations.
• Intensified market competition compressing margins and volumes.

Jiangxi Black Cat Carbon Black Inc.,Ltd (002068.SZ) - Profitability Metrics

• Reported net profit: CNY 25.13 million (2024)
• Gross profit: CNY 317.31 million; Gross profit margin: 3.43%
• Operating margin: -1.13%
• EBITDA margin: 2.78%
• Net profit margin: 0.25% (reported alongside the CNY 25.13 million figure)
• Alternate reported net profit margin: -1.42% (reflecting contradictory/loss indication in certain disclosures)
• Earnings per share (EPS): -0.18

• Gross margin of 3.43% indicates limited buffer to absorb cost volatility or pricing pressure.
• Positive net profit headline (CNY 25.13M) sits uneasily with negative operating margin and reported negative EPS, signaling that non-operating items or one-offs may be affecting bottom-line presentations.
• Low EBITDA margin (2.78%) suggests thin operational earnings before capital structure and tax impacts.
• Conflicting net margin figures (0.25% vs. -1.42%) merit careful review of the company's financial notes and reconciliation items.

Jiangxi Black Cat Carbon Black Inc.,Ltd (002068.SZ) - Debt vs. Equity Structure

• Debt-to-Equity Ratio: 1.27 - higher reliance on debt than equity.
• Total Debt: CNY 2.34 billion; Cash Reserves: CNY 461.7 million; Net Debt: CNY 1.88 billion.
• Interest Coverage Ratio: -1.22 - earnings are insufficient to cover interest expenses.
• Equity (Book Value): CNY 2.81 billion; Book Value per Share: CNY 3.72.
• Altman Z-Score: 1.92 - below the safe threshold of 3, indicating higher financial distress risk.
• Piotroski F-Score: 3 - suggesting weak fundamentals across profitability, leverage, and efficiency.

• Liquidity and solvency concern: net debt remains substantial relative to equity and cash buffers.
• Earnings vulnerability: negative interest coverage implies operating losses or very low EBIT versus interest expense.
• Balance-sheet risk: Altman Z-Score near the distress zone warrants monitoring of refinancing needs and covenant exposure.
• Fundamental weakness: Piotroski F-Score of 3 points to limited improvement in profitability, leverage, or efficiency metrics.

Jiangxi Black Cat Carbon Black Inc.,Ltd (002068.SZ) - Liquidity and Solvency

• Current ratio: 0.91 - short-term assets cover only 91% of short-term liabilities.
• Quick ratio: 0.56 - excluding inventory, immediate liquid assets cover just 56% of short-term liabilities.
• Operating cash flow: CNY 1.98 million versus capital expenditures of CNY 343.49 million, yielding free cash flow of -CNY 341.50 million.
• Net income: -CNY 14.14 million - a reported net loss for the period.
• Working capital: -CNY 422.48 million - indicates a shortfall to meet short-term obligations.
• Net cash per share: -CNY 4.54 - negative cash position on a per-share basis.

• Negative free cash flow driven primarily by large CapEx relative to minimal operating cash inflow.
• Negative working capital and net cash per share increase dependence on external financing or asset disposals.
• Low quick ratio suggests limited buffer if inventory becomes illiquid or declines in value.

Jiangxi Black Cat Carbon Black Inc.,Ltd (002068.SZ) - Valuation Analysis

• Market capitalization: CNY 8.02 billion
• Enterprise value (EV): CNY 11.42 billion - EV exceeds market cap, reflecting net debt/lease obligations
• Price-to-book (P/B): 2.86 - market values equity at a sizable premium to book value
• Price-to-tangible-book (P/TBV): 3.58 - premium remains when intangible assets are stripped out
• Price-to-free-cash-flow (P/FCF): Not available - company has negative free cash flow
• Price-to-operating-cash-flow (P/OCF): 4,048.47 - extremely high relative to operating cash flow
• Earnings yield: -1.64% - negative earnings yield implies current earnings are a loss on a per-share basis

• The EV-to-market-cap gap indicates leverage and obligations materially affect enterprise valuation.
• High P/B and P/TBV ratios signal market willingness to pay above balance-sheet values; investor expectations may be growth- or brand-driven.
• Negative FCF and extremely high P/OCF show cash-generation weakness - a central risk when valuing future returns.
• Negative earnings yield underscores current unprofitability on a per-share basis, increasing reliance on turnaround or margin recovery for upside.

Jiangxi Black Cat Carbon Black Inc.,Ltd (002068.SZ) - Risk Factors

• High leverage: debt-to-equity ratio of 1.27 - debt exceeds shareholders' equity, raising solvency concerns and refinancing risk.
• Poor interest coverage: interest coverage ratio of -1.22 - operating earnings are insufficient to service interest, implying reliance on external financing or asset sales.
• Altman Z-Score: 1.92 - below common safe thresholds, signaling elevated probability of financial distress or bankruptcy risk.
• Negative free cash flow: -CNY 341.50 million - indicates cash shortfalls to fund operations, capex and debt repayments without new financing.
• Declining profitability: net profit margin of -1.42% - company is generating losses on sales, reflecting margin compression or one-off charges.
• Weak liquidity: current ratio 0.91 and quick ratio 0.56 - current assets are insufficient to cover short-term liabilities, increasing default risk on payables and short-term debt.
• Negative earnings yield: -1.64% - earnings per share are negative relative to market price, reducing investment return expectations based on current earnings.

• Operational sensitivity: commodity pricing, feedstock costs and capacity utilization swings can further erode margins.
• Refinancing and covenant risk: high leverage and negative coverage increase the likelihood of covenant breaches or costly refinancing terms.
• Market perception: persistent negative earnings and cash flow may reduce investor confidence and access to capital markets.

Jiangxi Black Cat Carbon Black Inc.,Ltd (002068.SZ) - Growth Opportunities

• Carbon nanotube (CNT) powder development aimed at lithium‑ion battery conductive additives and conductive pastes - a route to higher-value sales and tech differentiation.
• Close collaboration with leading domestic tire manufacturers, including joint new‑product development that can secure long-term offtake and incremental market share in tire carbon black.
• Ongoing R&D and pilot-to-industrialization programs for new products, indicating a pipeline that can convert into scalable revenue over 1-3 years.
• Active customer engagement and partnership-building as industry supply-demand dynamics shift, helping stabilize volumes and pricing exposure.
• Domestic production emphasis for conductive carbon black to substitute imports and tap fast‑growing local demand in electronics and batteries.
• Exploration of opportunities in power generation, transmission, distribution and supply sectors to diversify end markets and reduce cyclicality tied exclusively to rubber/tire demand.

• Revenue diversification potential: If CNT and conductive carbon black reach 3-5% of group revenues within 2-4 years, gross margin could improve by 100-250 bps given higher ASPs on specialty products.
• Customer & channel risk mitigation: Deepening ties with tier‑1 tire makers provides volume stability; new electrification and electronics customers reduce cyclic sensitivity.
• Capital intensity and payback: Elevated capex in 2022-2023 reflects industrialization; payback depends on successful scale‑up and commercialization of CNT/ conductive offerings.

• Commercial off‑take agreements or joint development announcements with battery makers or conductive paste formulators.
• Quarterly volume mix showing rising share of conductive carbon black / CNT revenues.
• R&D-to-revenue ratio and time-to-industrialization milestones for pilot lines.
• Price realization trends versus feedstock/naphtha/coal tar pitch input costs.