Xiangxing International (1732.HK) Q4 2024 Earnings Report

Xiangxing International’s QQ4 2024 results show a modest top-line uplift in a highly cash-bearing balance sheet, underscoring a company in transition from revenue growth to profitability stabilization. Revenue for the quarter rose 14.39% YoY to 56.15 million CNY, with gross profit of 9.09 million CNY and a gross margin of 16.18%. Despite this, operating income remained negative at -4.37 million CNY and net income declined to -6.13 million CNY, resulting in a negative EPS of -0.0049 for the quarter. The discrepancy between EBITDA (4.95 million CNY) and reported operating income highlights the influence of non-cash or unusual items and/or rearrangements that warrant closer scrutiny in future quarters. From a liquidity and balance-sheet perspective, Xiangxing exhibits a strong relative funding position: cash and cash equivalents totaling 31.25 million CNY and a net cash position of approximately -30.20 million CNY (i.e., net cash). The company carries minimal debt (short-term 929,000 CNY and long-term 124,000 CNY; total debt 1.053 million CNY), supporting a robust current ratio of 9.28 and quick ratio of 9.08. However, cash flow from operations was negative (-8.26 million CNY) and free cash flow was -7.41 million CNY, driven by a sizable working capital outflow (-20.04 million CNY) largely associated with accounts receivable movement (-20.12 million CNY) and other non-cash items (17.92 million CNY). The quarter’s dynamics imply ongoing operating discipline and working-capital management will be critical to translating revenue growth into sustainable profitability. In the near term, the key questions for investors are whether Xiangxing can reduce the receivables burden, convert more EBITDA into free cash flow, and stabilize margins amid any volatility in the domestic logistics environment. On a relative basis, Xiangxing’s balance sheet is far less leveraged than many peers, which may help cushion near-term volatility while profitability improves.