Eagle Eye Warning: The ratio of net cash flow from operating activities to net profit for Yunnan Baiyao is less than 1

Sina Finance Listed Company Research Institute | Financial Report Eagle-Eye Early Warning

On March 31, Yunnan Baiyao released its 2025 annual report.

The report shows that the company’s total operating revenue for 2025 was RMB 41.187 billion, up 2.88% year over year; net profit attributable to shareholders was RMB 5.153 billion, up 8.51%; net profit after deducting non-recurring gains and losses attributable to shareholders was RMB 4.865 billion, up 7.55%; and basic earnings per share were RMB 2.89/share.

Since it was listed in December 1993, the company has issued cash dividends 34 times, with cumulative cash dividends already implemented totaling RMB 30.558 billion.

The listed-company financial report eagle-eye early warning system performs intelligent quantitative analysis on Yunnan Baiyao’s 2025 annual report across four major dimensions: performance quality, profitability, funding pressure and safety, and operating efficiency.

I. Performance Quality

During the reporting period, the company’s revenue was RMB 41.187 billion, up 2.88%; net profit was RMB 5.19 billion, up 8.87%; and net cash flow from operating activities was RMB 4.6 billion, up 7.04%.

From an overall performance perspective, it is necessary to focus on:

• The growth rate of net profit attributable to shareholders has continued to decline. In the annual reports over the past three periods, the year-over-year changes in net profit attributable to shareholders were 36.41%, 16.02%, and 8.51%, respectively, with the downward trend continuing.

From the allocation between revenue, costs, and period expenses, it is necessary to focus on:

• Divergence between operating revenue and taxes and surcharges. During the reporting period, operating revenue changed by 2.88% year over year, taxes and surcharges changed by -3.71% year over year, and there is a divergence between operating revenue and taxes and surcharges.

Based on cash flow quality, it is necessary to focus on:

• The ratio of net cash flow from operating activities to net profit is below 1. During the reporting period, the ratio of net cash flow from operating activities to net profit was 0.886, below 1, indicating weaker profit quality.

II. Profitability

During the reporting period, the company’s gross margin was 29.51%, up 5.78% year over year; net profit margin was 12.6%, up 5.82% year over year; and return on net assets (weighted) was 13.02%, up 8.59% year over year.

III. Funding Pressure and Safety

During the reporting period, the company’s asset-liability ratio was 26.02%, down 1.99% year over year; the current ratio was 2.64, and the quick ratio was 2.16; total debt was RMB 2.193 billion, of which short-term debt was RMB 2.106 billion; short-term debt as a proportion of total debt was 96.05%.

From an overall financial position perspective, it is necessary to focus on:

• The current ratio has continued to decline. In the annual reports over the past three periods, the current ratio was 2.85, 2.66, and 2.64, respectively, indicating weakening short-term debt-paying ability.

From short-term funding pressure, it is necessary to focus on:

• The cash ratio has continued to decline. In the annual reports over the past three periods, the cash ratio was 1.09, 1.08, and 1.08, respectively, showing a continuing decline.

From the perspective of cash management and control, it is necessary to focus on:

• The ratio of interest income / cash and cash equivalents is less than 1.5%. During the reporting period, cash and cash equivalents were RMB 9.11 billion, short-term debt was RMB 260 million; the company’s average ratio of interest income / cash and cash equivalents was 0.905%, below 1.5%.

• Prepayments have changed significantly. During the reporting period, prepayments were RMB 430 million, with a change rate versus the beginning of the period of 43.11%.

• The ratio of prepayments / current assets has continued to grow. In the annual reports over the past three periods, the ratio of prepayments / current assets was 0.86%, 0.89%, and 1.28%, respectively, showing continuous growth.

• The growth rate of prepayments is higher than the growth rate of operating costs. During the reporting period, prepayments increased 43.11% versus the beginning of the period; operating costs grew 0.58% year over year; the growth rate of prepayments is higher than that of operating costs.

• Other receivables have changed significantly. During the reporting period, other receivables were RMB 330 million, with a change rate versus the beginning of the period of 233.04%.

• The ratio of other receivables / current assets has continued to increase. In the annual reports over the past three periods, the ratio of other receivables / current assets was 0.27%, 0.29%, and 0.96%, respectively, showing a continuing rise.

IV. Operating Efficiency

During the reporting period, the company’s accounts receivable turnover ratio was 4.1, up 1.89% year over year; the inventory turnover ratio was 4.64, up 2.28% year over year; and the total asset turnover ratio was 0.77, up 2.42% year over year.

For long-term assets, it is necessary to focus on:

• The unit fixed-asset income output value has been declining year by year. In the annual reports over the past three periods, the ratio of operating revenue / original value of fixed assets was 14.69, 13.29, and 12.58, respectively, showing a continuous decline.

• Other non-current assets have changed significantly. During the reporting period, other non-current assets were RMB 160 million, up 38.83% versus the beginning of the period.

Click Yunnan Baiyao’s eagle-eye early warning to view the latest warning details and a visual preview of the financial report.

Sina Finance listed-company financial report eagle-eye early warning introduction: The listed-company financial report eagle-eye early warning is an intelligent professional analysis system for listed-company financial reports. The eagle-eye early warning aggregates a large number of authoritative financial experts from accounting firms and listed companies, among others, and tracks and interprets the latest financial reports of listed companies across multiple dimensions such as company performance growth, earnings quality, funding pressure and safety, and operating efficiency, and provides alerts to possible financial risk points in the form of text and images. It provides professional, efficient, and convenient technical solutions for listed-company financial risk identification and early warning for financial institutions, listed companies, regulatory bodies, and others.

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Responsible editor: Xiao Lang Express