China Electronics Huada Technology Company Limited (CE Huada Tech) reported a 59.9% year-on-year drop in profit attributable to owners to HK$235.36 million for the year ended 31 December 2025, as revenue fell 7.1% to HK$2.18 billion. Basic earnings per share declined to 11.59 HK cents from 28.94 HK cents.

Gross profit contracted 26.3% to HK$836.86 million, pushing the gross margin down by 8.9 percentage points to 38.4%, reflecting intensified price competition in smart card and secure element chips. Operating profit fell 60.0% to HK$260.94 million.

Cost pressures were evident: • Selling and marketing costs rose 25.2% to HK$57.07 million, lifting their share of revenue to 2.6% (2024: 1.9%). • Administrative expenses increased 7.9% to HK$607.12 million, largely driven by higher R&D spending. • Research and development outlays climbed 10.7% to HK$495.72 million, representing 22.7% of revenue, up from 19.1% a year earlier.

Other income slipped 29.4% to HK$88.67 million, mainly due to lower government grants and interest income. Net finance costs were reduced to HK$9.92 million from HK$23.22 million on lower borrowing costs.

The board proposed a final dividend of 3.6 HK cents per share, down from 9.0 HK cents in 2024, amounting to HK$73.08 million and representing a payout ratio of roughly 31%.

Balance-sheet indicators remained solid. Cash and cash equivalents stood at HK$617.08 million, while time deposits and restricted cash totaled HK$1.74 billion. Bank and other borrowings fell to HK$276.85 million, all short-term, leaving the group in a net cash position. Net current assets increased to HK$1.70 billion, and undrawn committed facilities amounted to HK$1.02 billion.

Trade receivables contracted 41.1% to HK$206.02 million, with 48.7% outstanding for less than 30 days, versus 34.5% a year earlier. Contract liabilities dropped to HK$62.48 million from HK$134.23 million, reflecting revenue recognition from prior-year customer prepayments.

Management cited stabilising global demand for smart cards and secure element chips, alongside strong volume growth in security microcontroller unit (MCU) chips and eSIM-related products. However, average selling price pressure persisted, weighing on revenue and margins.

No material capital commitments or contingent liabilities were recorded at year-end, and the company confirmed compliance with the Corporate Governance Code throughout 2025.