Earns 5.1 billion annually, with dividends exceeding 2.1 billion! Yuntianhua's cycle remains under pressure but maintains stable profits.

Hui Zheng Information, March 24, Yuntianhua officially disclosed its 2025 annual report.

According to the announcement, in 2025, Yuntianhua recorded total operating revenue of RMB 48.415 billion, a year-on-year decrease of 21.47%; net profit attributable to shareholders was RMB 5.156 billion, a year-on-year decrease of 3.40%; profit excluding non-recurring gains and losses was RMB 5.007 billion, a year-on-year decrease of 3.60%; net cash flow from operating activities was RMB 9.087 billion, a year-on-year decrease of 15.44%; basic earnings per share were RMB 2.8283, and the annualized weighted average return on net assets was 21.87%.

Structural transformation under performance pressure

Against the backdrop of a year-on-year decline in the revenue scale, Yuntianhua’s net profit only fell slightly. Its earnings resilience was far above the industry average, mainly because its proactive business-structure optimization strategy has taken effect.

From the perspective of revenue composition, revenue from the trading and logistics segment contracted to RMB 27.098 billion, which is the core factor affecting the change in total revenue. This is not due to a decline in operating capability; rather, Yuntianhua proactively divested trading businesses with low gross margins and high capital occupation, and advanced the strategic choice of “thinning out to strengthen and improve health,” which is highly aligned with the current development trend in the chemical industry to focus on its main business and improve profitability quality. As the revenue pillar, its fertilizer business achieved operating revenue of RMB 11.850 billion for the full year. Under industry pressures such as excess urea capacity and phosphate fertilizer prices running at low levels, it held steady in its core position. The data shows that Yuntianhua’s phosphate fertilizer capacity reached 5.55 million tons per year, ranking second in China and fourth globally. The domestic market share of its monoammonium phosphate and diammonium phosphate products has remained at the forefront of the industry. Leveraging advantages across the entire industrial chain, it stabilized its market share. At the same time, the phosphorus chemical segment of Yuntianhua achieved revenue of RMB 3.383 billion, maintaining a stable operating posture, demonstrating its deep accumulation in the comprehensive utilization of phosphorus resources.

The explosive growth of the new energy materials business has become the core highlight of structural optimization. The annual report shows that in 2025, this business achieved revenue of RMB 1.321 billion, up 75.2% year-on-year from RMB 0.754 billion in 2024. Its growth rate far outpaced other business segments, indicating that its layout in the new energy track has entered a harvest period. According to research and survey data from Buyang Plast Research Institute, in 2025, China’s shipments of lithium iron phosphate materials reached 3.87 million tons, up 58% year-on-year. The continued expansion of the new energy vehicle and energy storage markets provides broad space for phosphorus chemical companies to enter the new energy materials track. Yuntianhua’s forward-looking layout not only built a second growth curve, but also effectively offset the risks of cyclical fluctuations in its traditional fertilizer business.

Anchoring high value-added tracks to build an industrial moat

While making strategic adjustments to its business structure, Yuntianhua continued to increase capacity planning and R&D investment in 2025. With efforts made from both the resource side and the technology side, it built long-term competitive barriers. The annual report shows that at the end of 2025, Yuntianhua’s book balance of construction in progress was RMB 2.539 billion, up 15.62% year-on-year from RMB 2.196 billion at the beginning of the period. The capacity expansion precisely anchored three major directions: securing phosphate rock resource guarantees, new energy materials precursors, and comprehensive environmental treatment—highly matching the company’s transformation path.

Phosphate rock resources are the lifeblood of the phosphorus chemical industry chain and Yuntianhua’s core competitive moat. Currently, Yuntianhua’s battery new materials supporting the 4.5 million tons per year phosphate rock flotation project has an engineering progress of 95%; the Kunyang phosphate rock mine No. 2 underground mining project has an engineering progress of 96%. With the two projects about to be put into operation, they will significantly enhance Yuntianhua’s ability to supply phosphate rock from within. Meanwhile, Yuntianhua obtained the mining right for the phosphate rock mine at Wanchang County’s Wan chang? (Wanchang County, Wanchang?) through its investment in a participating company, Juping New Materials, gaining a resource amount of 2.438 billion tons for the mine, further strengthening its resource reserves.

From the industry perspective, data from the National Bureau of Statistics shows that in 2025, China’s phosphate rock (calculated as 30% phosphorus pentoxide equivalent) output was 12146.8 million tons, up 11.5% year-on-year. However, under constraints from policies such as the Yangtze River ecological protection and environmental-driven mining restrictions, the industry’s high market-entry threshold and high concentration characteristics have continued to be strengthened, and the tight supply situation of high-grade phosphate rock has not changed. Against this backdrop, Yuntianhua’s upstream resource layout, from the source, locks in cost advantages and supply stability for the entire industrial chain.

On the technology and R&D side, the company’s total R&D expenses in 2025 totaled RMB 0.731 billion, up 24.7% year-on-year from RMB 0.586 billion in 2024. Among them, R&D materials expenses were RMB 0.394 billion, accounting for more than 50%, highlighting an industrialization-oriented direction for R&D. R&D investment focuses on core areas such as lithium iron phosphate new materials, efficient utilization of phosphate rock, and the resource-based utilization of phosphogypsum. The 100,000-ton-per-year lithium iron phosphate project has completed the continuous-process technology transformation, and the unit’s operating efficiency has been significantly improved. At the same time, Yuntianhua continued to increase investment in environmental protection, completing core investment in phosphogypsum harmless treatment projects of 500 million tons per year and 160 million tons per year. This not only responds to the requirements of industry environmental protection policies, but also clears compliance obstacles for long-term development.

Continuous optimization of financial structure

In a complex market environment, a sound financial position is the core support for enterprises to fend off risks and advance the implementation of strategy. Yuntianhua’s 2025 annual report also demonstrates continuous improvement in financial quality and strong “cash-generating” operating capabilities.

The annual report shows that in 2025, Yuntianhua’s finance expenses totaled RMB 2.87 billion, down 41.2% year-on-year from RMB 4.88 billion in 2024. The main benefit came from the reduction in the scale of interest-bearing liabilities and the decline in comprehensive funding costs, fully reflecting the effectiveness of refined financial management and the results of cost reduction and efficiency improvement. Despite cyclical fluctuations in the industry, the company’s net operating cash flow for the full year still reached RMB 9.087 billion, continuously maintaining a large positive net inflow; as of the end of 2025, the company’s balance of cash and cash equivalents was RMB 45.55 billion, with ample cash reserves, providing sufficient support for capacity building, R&D investment, and strategic investment, while also significantly enhancing the company’s ability to withstand cyclical risk.

Meanwhile, Yuntianhua’s asset quality continued to improve. In 2025, the total asset impairment losses were RMB 1.19 billion, sharply narrowed from RMB 5.56 billion in 2024, with the risk of non-performing assets effectively controlled, further improving the robustness of the balance sheet.

In terms of shareholder returns, Yuntianhua has always maintained a stable cash dividend policy. For 2025, the company plans to distribute cash dividends of RMB 12 per 10 shares to all shareholders (including tax), totaling RMB 21.88 billion. Together with the interim dividends, the annual cash dividend payout ratio as a percentage of net profit attributable to shareholders reached 49.50%. A dividend ratio of nearly 50% not only demonstrates Yuntianhua’s operating philosophy of sharing development results with investors, but also reflects management’s strong confidence in future profitability. It is of great significance for enhancing the company’s long-term investment value in the capital market and attracting long-term value investors.

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