Yida China Holdings (3639.HK) Q2 2025 Earnings Report

- Core operating metrics illustrate a modestly constructive quarter: revenue of 350.20 million CNY and gross profit of 49.85 million CNY yield a gross margin of 14.23%. Operating income reached 10.51 million CNY with EBITDA of 12.83 million CNY, signaling that the business segments generated positive operating activity despite a challenging environment.
- Net income was materially negative at -387.77 million CNY, driven primarily by a large negative total other income and expenses net of -364.68 million CNY. This non-operating item more than offset the positive operating performance, resulting in a headline loss despite positive EBIT/ EBITDA.
- Balance sheet and liquidity indicators point to meaningful leverage and stronger liquidity risk than peers. Current ratio stands at 0.54, quick ratio at 0.088, and cash ratio at 0.007, implying limited near-term liquidity buffers. Leverage remains elevated (debt ratio 0.343; debt-to-capitalization 0.641; equity multiplier 5.22), underscoring reliance on external funding in a capital-intensive sector.
- Valuation vs. fundamentals presents a stark contrast: price-to-book around 0.022x and price-to-sales near 0.20x imply a severe discount to book value, consistent with the market pricing of a company reporting sizeable losses and liquidity concerns. The investment case hinges on resolution of non-operating items, balance-sheet repair, and selective asset optimization.
- Given the absence of formal forward guidance in the provided data and ongoing real estate sector headwinds in China, the near-term focus should be on deleveraging, improving working capital efficiency, and potential asset-light strategies or asset sales to restore cash generation and investor confidence.