Han's CNC tripled profit as sales doubled, then doubled equity

Net profit rose 214% to 1.54 billion yuan on 101% revenue growth. Equity doubled to 12.4 billion yuan after the Hong Kong share issue.

Han's CNC Science and Technology said on the evening of 15 October that its net profit for the first nine months rose 214% to 1.54 billion yuan. The Shenzhen listed company makes drilling and inspection machines for printed circuit boards, or PCBs.

Revenue doubled, so profit tripled, and the Hong Kong share issue doubled the equity base. Han's CNC earned a higher margin during an AI board building boom. Whether the larger capital base earns a good return will show up in receivables, the money customers still owe.

The figures come from a preliminary results express in the company's announcement, republished by CFi.CN. The numbers are actual and unaudited. The company had issued no earlier guidance for the period.

Revenue rose 101% to 7.84 billion yuan. Operating profit rose 224% to 1.81 billion. Net margin, which is net profit as a share of revenue, climbed from 12.6% to 19.7%. Costs grew slower than sales, so each extra yuan of revenue kept more profit.

The company's own explanation is specific. It names high layer count HDI boards for the next generation of rack server compute and switch units. It also names N+N high layer boards and mSAP class substrates for 800G and 1.6T optical modules. HDI means high density interconnect, the fine line boards that carry the densest signals in AI servers.

PCB makers are expanding capacity to build these boards, and the filing says orders grew sharply across the whole product line. Han's CNC sells the machines that drill and inspect them, so its sales follow its customers' capital spending.

Operating margin moved from 14.3% to 23.0%. Each additional yuan of revenue over last year's nine months carried about 32 fen of operating profit, where a fen is one hundredth of a yuan. The average on last year's base was 14 fen.

Revenue rose about two times while operating profit rose about 3.2 times. Costs did not keep pace with sales, which suggests the business is running a fuller factory on the same fixed base. The filing does not itemise those costs, so the split between price and volume is not public.

The quality of the profit supports that reading. Net profit excluding non recurring items was 1.54 billion yuan, up 222.5% from 476 million. That is almost the same as the headline figure. Gains from asset sales or subsidies explain very little of the jump, so the result comes from selling machines.

Revenue grew by 3.94 billion yuan year on year, while net profit grew by 1.05 billion. About 27 fen of each additional yuan of sales reached the bottom line, against 13 fen on the base nine months of last year.

That gap is why net margin rose by seven points while revenue doubled. Growth at this rate will normalise because the comparison base turns in 2027, when this year's first nine months become the bar. A seller in a crowded, price taking market usually does not report a margin gain like this.

The balance sheet is more complicated. Both changes are measured against 31 December 2025. Total assets rose 81% to 19.2 billion yuan from 10.6 billion. Equity rose 104% to 12.4 billion yuan, an increase of 6.33 billion.

The filing attributes the equity rise to profit and to the share capital and capital reserves added by the Hong Kong listing. H shares are the shares of a mainland company that trade in Hong Kong. Nine month profit supplies 1.54 billion yuan of the rise. Most of the remaining 4.8 billion therefore came from the H share issue.

Shareholders paid for the growth through dilution and a much larger capital base. The share count rose 14.9% to 489.0 million. Earnings per share rose 182% to 3.27 yuan, a smaller gain than the 214% profit rise.

Net asset value per share is equity divided by shares. It rose from 14.27 yuan to 25.35 yuan. The cash raised is therefore already on the books at a higher value per share.

Weighted return on equity improved from 9.14% to 15.43%. Return on equity is profit divided by shareholders' capital. The weighted figure counts the new equity only for the part of the period it was held. A full year on the larger base will press harder on the ratio.

At 12.4 billion yuan of equity, holding 15% takes about 1.9 billion yuan of profit a year. Nine months at 1.54 billion annualise to about 2.1 billion. That clears the bar, with limited room if growth slows.

The filing says asset growth came from the H share proceeds and from receivables and inventory rising as production and sales expanded. A tool maker in a boom buys components and builds machines before it is paid. Its customers are PCB manufacturers racing to add capacity.

Revenue of 7.84 billion yuan can therefore include sales that have shipped, been invoiced and not yet collected. A 19.7% margin is a margin on accounting profit. Cash conversion decides whether it is also a margin on cash.

The third quarter report will show receivables and inventory against the 31 December 2025 balance. If receivables have grown faster than revenue over these nine months, the 214% headline will look less like cash.