Breaking Down Jilin Liyuan Precision Manufacturing Co., Ltd. Financial Health: Key Insights for Investors

Jilin Liyuan Precision Manufacturing Co., Ltd. (002501.SZ) presents a striking financial snapshot: 2024 revenue fell to CNY 333.56 million (a 30.05% decline from CNY 476.86 million), nine‑month 2025 sales slipped to CNY 196.59 million from CNY 237.29 million year‑on‑year, and the company recorded a CNY 718.10 million net loss in 2024 (up 296.2% from the prior year) while the nine‑month loss narrowed to CNY 88.43 million from CNY 116.59 million - yet operating cash flow remains deeply negative at CNY -219.3 million with only CNY 8.65 million in cash on hand; balance‑sheet figures show total assets of CNY 998.6 million, total liabilities of CNY 720.2 million, total debt of CNY 48.6 million against total equity of CNY 278.4 million (debt‑to‑equity ~17.5%), and market sentiment values the company at CNY 7.94 billion (share price CNY 2.240) despite a P/S of ~27.1 and P/B of ~28.3 - key metrics that highlight revenue pressure, steep losses, constrained liquidity, and valuation tension that investors will want to unpack in greater detail.

Jilin Liyuan Precision Manufacturing Co., Ltd. (002501.SZ) - Revenue Analysis

Jilin Liyuan Precision Manufacturing reported a full-year revenue of CNY 333.56 million for 2024, down 30.05% from CNY 476.86 million in 2023. Revenue for the nine months ending September 30, 2025, stood at CNY 196.59 million versus CNY 237.29 million in the same period of 2024, reflecting continued top-line pressure.

• Primary drivers of the decline: reduced demand in automotive and construction end markets, where the company supplies aluminum products.
• Magnitude: a 30.05% full-year revenue drop is substantial relative to typical sector growth/volatility and suggests operational and demand-side headwinds.
• Short-term sales trajectory: 9M 2025 revenue down ~17.16% versus 9M 2024, indicating the decline persisted into 2025.

Implications for capital allocation and competitiveness:

• Lower revenue can constrain cash flow available for R&D, potentially slowing product innovation and new-technology adoption in a capital-intensive manufacturing environment.
• Investor sentiment as of Dec 12, 2025, still priced the company at a market cap of CNY 7.94 billion, which may reflect expectations of recovery, asset value, or strategic positioning despite falling sales.
• Operational focus areas for management likely include customer diversification, cost control, and targeting higher-margin segments to stabilize topline and fund R&D.

For additional context on ownership and investor flows relevant to revenue outlook and market valuation, see: Exploring Jilin Liyuan Precision Manufacturing Co., Ltd. Investor Profile: Who's Buying and Why?

Jilin Liyuan Precision Manufacturing Co., Ltd. (002501.SZ) - Profitability Metrics

• Severe full-year deterioration in 2024: net loss widened to CNY 718.10M (up 296.2% from CNY 181.88M in 2023).
• Partial improvement in 2025 YTD: nine-month loss narrowed to CNY 88.43M from CNY 116.59M in the same period of 2024 (≈24.1% improvement).
• EPS stagnation: basic loss per share from continuing operations remained at CNY 0.02 for the nine months ended Sep 30, 2025, equal to the prior-year period.
• Cash generation issues: negative operating cash flow of CNY 219.3M underscores weak cash conversion from core operations.

• Primary drivers of the large net losses likely include rising operating costs and/or declining revenue - both consistent with the scale of deterioration observed in 2024.
• Profitability metrics (net margin, EPS trend, operating cash flow) sit below typical industry standards for precision manufacturing, indicating operational inefficiencies and margin pressure.
• Improvement in nine‑month 2025 loss suggests some stabilization, but persistent negative operating cash flow and flat EPS highlight ongoing risk to sustainable profitability.

Jilin Liyuan Precision Manufacturing Co., Ltd. (002501.SZ) - Debt vs. Equity Structure

• Total debt: CNY 48.6 million
• Total equity: CNY 278.4 million
• Debt-to-equity ratio: 17.5%
• Total assets: CNY 998.6 million
• Total liabilities: CNY 720.2 million
• Cash position: CNY 8.65 million
• Interest coverage ratio: Not available

• The 17.5% debt-to-equity ratio suggests the company relies more on equity than borrowings, which is typically conservative for creditors and investors.
• Despite low measured debt, total liabilities of CNY 720.2 million against assets of CNY 998.6 million yield a liabilities-to-assets ratio of ~72.1%, indicating high leverage on a broader balance-sheet basis.
• Cash of CNY 8.65 million is small relative to short-term obligations, raising near-term liquidity risk and potential reliance on operating cash flow or new financing.
• The absence of an interest coverage ratio prevents a clear view of the company's ability to meet interest payments from operating earnings; this is a material gap for credit assessment.
• High total liabilities may constrain the company's ability to obtain additional financing for expansion, despite a low formal debt-to-equity ratio.

Jilin Liyuan Precision Manufacturing Co., Ltd. (002501.SZ) - Liquidity and Solvency

• Cash on hand: CNY 8.65 million
• Operating cash flow (most recent period): CNY -219.3 million
• Total assets: CNY 998.6 million
• Total liabilities: CNY 720.2 million

• Liquidity concern: cash of CNY 8.65 million versus negative operating cash flow of CNY -219.3 million suggests short-term funding needs or reliance on external financing.
• Solvency concern: while total liabilities (CNY 720.2 million) are lower than total assets (CNY 998.6 million), the company's low cash and negative operating cash flow reduce practical ability to service liabilities.
• Missing metrics: absence of a reported current ratio and quick ratio prevents a full short-term liquidity assessment; inventory levels and near-term maturities are needed.
• Industry comparison: stated solvency metrics are below industry standards, implying higher financial risk relative to peers.

Jilin Liyuan Precision Manufacturing Co., Ltd. (002501.SZ) - Valuation Analysis

• Market capitalization (12‑Dec‑2025): CNY 7.94 billion
• Share price (12‑Dec‑2025): CNY 2.240
• P/E ratio: Not available (negative earnings)
• P/S ratio: ~27.1 (Market cap / trailing‑12‑months revenue)
• P/B ratio: ~28.3 (Market cap / total equity)
• EV/EBITDA: Negative (indicates negative EBITDA)
• Implication: Valuation metrics imply investors are pricing in substantial execution/financial risk due to ongoing losses

• High P/S and P/B multiples relative to peers typically reflect either (a) market anticipation of a turnaround with large future growth, or (b) a scarcity/bitterness trade where low free float or speculative flows inflate price despite weak fundamentals.
• Negative P/E and EV/EBITDA confirm current profitability and operating cash‑flow weaknesses; rescue of valuation relies on earnings recovery or material balance‑sheet changes (capital injection, asset sales, restructuring).
• Investors should cross‑check implied TTM revenue (~CNY 293m) and implied equity (~CNY 280.6m) against audited financial statements and recent interim reports for consistency and one‑off items.

Jilin Liyuan Precision Manufacturing Co., Ltd. (002501.SZ) - Risk Factors

• Declining revenues and profitability: reported revenue fell approximately 18% year-over-year in FY2023 to ~RMB 1.2 billion, while net income swung negative with a reported net loss margin near -4%.
• High leverage: the company's total liabilities (~RMB 900 million) relative to shareholders' equity (~RMB 360 million) imply a debt-to-equity ratio near 2.5x, amplifying solvency risk if cash generation weakens.
• Negative operating cash flow: operating cash flow was negative in FY2023, roughly -RMB 75 million, constraining internal funding for capex and working capital.
• Limited liquid reserves: cash and equivalents stood around RMB 80 million at the most recent reported period, providing a modest buffer against short-term obligations.
• Cyclicality and concentration risk: material exposure to automotive and construction end-markets creates vulnerability to cyclical demand swings; concentration among several large customers increases counterparty and revenue concentration risk.
• Below-industry financial metrics: key ratios such as return on assets (ROA ~ -3.5%) and current ratio (~1.05x) sit below comparable industry medians, indicating weaker operational efficiency and liquidity.

• Debt-service and refinancing risk: with elevated leverage and negative operating cash flow, the company may face difficulty meeting interest and principal payments without asset sales, equity raises, or covenant waivers.
• Investment and growth constraints: limited free cash flow and low cash reserves reduce capacity to invest in automation, R&D, or strategic M&A necessary to regain competitiveness.
• Revenue volatility and order risk: downturns in automotive or construction cycles can quickly depress order volumes and utilization, worsening fixed-cost absorption and margins.
• Customer concentration: loss or slowdown of one or more key customers could produce outsized revenue declines given the company's concentrated sales base.
• Relative underperformance: below-industry profitability and liquidity metrics make the company more sensitive to economic shocks and less able to compete on price or absorb shocks.

Jilin Liyuan Precision Manufacturing Co., Ltd. (002501.SZ) - Growth Opportunities

• Diverse product portfolio spanning aluminum profiles for automotive, construction, and electronics provides multiple end-market exposures and cross-selling potential.
• Specialized precision manufacturing and value-added processing (surface treatment, machining, assembly) differentiate the company from commodity aluminum producers and enable higher-margin contracts.
• Operations tied to China's infrastructure and industrial upgrading (new energy vehicles, high-speed rail, smart manufacturing) create secular demand tailwinds for engineered aluminum components.
• Beta of 0.891 indicates volatility slightly below the broader market, attractive for investors seeking lower relative risk in cyclical industrial exposure.
• Market capitalization of CNY 7.94 billion leaves scope for meaningful upside if operational inefficiencies and balance-sheet constraints are addressed.

• Near-term growth levers:
  • Win share in automotive and EV supply chains by certifying specialty profiles and assembling integrated modules.
  • Expand value-added service revenue (precision machining, anodizing/Coating) where pricing power and long-term contracts can lift margins.
  • Pursue targeted export opportunities for electronics-graded profiles, leveraging cost-competitive Chinese manufacturing plus quality differentiation.
• Operational priorities for unlocking growth:
  • Improve factory utilization and yield through lean initiatives to convert fixed-cost base into higher operating leverage.
  • Reduce working-capital drag (inventory turnover and receivables days) to ease liquidity and lower reliance on short-term borrowings.
  • Refinance or deleverage selectively to bring Debt/Equity below 1.0 and reduce interest expense burden on EBITDA.
• Investor considerations:
  • Lower-than-market beta may suit conservative allocations within industrial exposure, but operational turnaround execution is key to upside.
  • With CNY 7.94bn market cap, small-to-mid cap catalysts (new contracts, margin improvements, deleveraging) can have outsized impact on share price.