On April 2, the 2025 annual report disclosed by Zhejiang Weixing New Building Materials Co., Ltd. (002372.SZ) showed that the company achieved operating income of 5.382 billion yuan, a year-on-year decrease of 14.12%; net profit attributable to the parent company was 741 million yuan, a year-on-year decrease of 22.24%; net profit after deducting non-recurring gains and losses was 684 million yuan, a year-on-year decrease of 25.37%.
Against the background of deep adjustments in real estate and shrinking demand in the consumer building materials industry, the decline in performance is not unexpected, but it still shows strong risk resistance in the cold winter of the industry.
The company plans to distribute a cash dividend of 3.5 yuan (tax included) to all shareholders for every 10 shares, totaling approximately 550 million yuan in cash, with a dividend ratio as high as 74.2%, demonstrating the company’s ability to sustain returns to shareholders and the stability of its financial position.
The performance decline of Weixing New Materials is not an isolated case, but a microcosm of the collective pressure on the entire consumer building materials industry in the real estate downturn cycle.
In 2025, the real estate market will continue to undergo in-depth adjustments. Data from the National Bureau of Statistics show that the newly started housing area for the whole year was 588 million square meters, a year-on-year decrease of 20.40%, and a decrease of 73.80% from the high point in 2020. Investment in real estate development was approximately 8.28 trillion yuan, a year-on-year decrease of 17.20%, and a decrease of 43.90% from the high point in 2021.
The sales area of commercial housing was approximately 881 million square meters, a year-on-year decrease of 8.7%.
The continued downturn in the real estate market has directly led to a “cliff-like” contraction in the demand for consumer building materials.
Annual report data shows that in 2025, the company’s manufacturing industry will achieve operating income of 5.349 billion yuan, accounting for 99.41% of total revenue, a slight increase of 0.12 percentage points from 99.29% in 2024, and a year-on-year decrease of 14.01%, slightly lower than the 14.12% decline in total revenue; other business income is 32
005,300 yuan, accounting for 0.59%, a decrease of 0.12 percentage points from 0.71% in 2024, and a sharp decline of 28.42% year-on-year. The decline is significantly higher than that of the manufacturing industry. It reflects the company’s strategic tendency to focus on core manufacturing business and shrink non-core businesses. It also reflects the fact that non-core businesses are more affected by industry fluctuations.
PPR series products, as the company’s absolute core revenue pillar, will achieve revenue of 2.492 billion yuan in 2025, accounting for 46.31% of total revenue, a slight decrease of 0.59 percentage points from 46.90% in 2024, and a year-on-year decrease of 15.20%.
As the domestic leader in retailing PPR pipes, Weixing New Materials’ revenue share of this product remained high even during the industry downturn, and the decline did not exceed the average decline in total revenue, reflecting the strong resilience of the home improvement retail channel.
The brand premium built by the Star Butler service system has become the core barrier against industry fluctuations. The gross profit margin of Lesso’s retail business is about 35%, while the gross profit margin of Weixing New Materials’ PPR products reaches 56.47%. The high premium supports its ability to resist risks in price wars.
PE series product revenue was 1.166 billion yuan, accounting for 21.68%, a decrease of 1.03 percentage points from 22.71% in 2024, and a year-on-year decrease of 18.00%, which was higher than the average level of total revenue.
PE series products are mainly used in engineering fields such as municipal water supply, drainage and sewage, heating, and gas. In 2025, the slowdown in infrastructure investment growth and the shrinkage of engineering end demand are the core incentives for the decline of this product line. It also reflects that the company’s engineering end business is more significantly affected by industry cycles.
PVC series product revenue was 749 million yuan, accounting for 13.93%, a slight increase of 0.73 percentage points from 13.20% in 2024, and a year-on-year decrease of 9.40%, which was the category with the smallest decline among the major product lines.
PVC series products are mainly used in fields with rigid needs such as drainage and sewage treatment and power sheathing. They are relatively less affected by the downturn in real estate. This data also confirms the anti-cyclical ability of rigid-demand products and has become a “stabilizer” in the company’s revenue.
Other product revenue was 941 million yuan, accounting for 17.49%, an increase of 1.01 percentage points from 16.48% in 2024, and a year-on-year decrease of 8.83%, which was also lower than the average level of total revenue.
This category covers new business sectors such as waterproofing and water purification. Based on the company’s business layout, although the revenue has declined slightly, the increase in the proportion reflects the company’s strategic tendency to cultivate new businesses, and the relatively mild decline also reflects the potential resilience of the new business.
In addition, the distribution model achieved revenue of 4.047 billion yuan, accounting for 75.20% of total revenue, a slight decrease of 0.57 percentage points from 75.77% in 2024, and a year-on-year decrease of 14.76%.
The distribution channel is the absolute main force of the company’s revenue, and the decline is slightly higher than the average level of total revenue (14.12%). However, based on the characteristics of the industry, the distribution model relies on offline terminal outlets and is closer to the needs of home improvement retail terminals. During the industry downturn, it has maintained a relatively stable ability to resist risks through terminal sinking and service upgrades.
Data shows that the company’s “Star Butler” service covers more than 30,000 terminal outlets, and the service premium rate of distribution channels exceeds 20%, becoming the core support to resist industry fluctuations.
The direct sales model achieved revenue of 1.334 billion yuan, accounting for 24.80%, an increase of 0.57 percentage points from 24.23% in 2024, and a year-on-year decrease of 12.10%, making it the channel with the smallest decline among the two types of models.
The direct sales model mainly focuses on customers such as municipal administration and large-scale projects. Although it declined year-on-year, the decline was lower than the average level of total revenue and distribution channels, reflecting the customer stickiness and project resource advantages of the company’s direct sales channels.
However, affected by the overall contraction of demand on the engineering side, direct sales channels still cannot completely avoid industry cycle risks.
Weixing New Materials Waterproofing Business is a core component of “Other Products”.
Although the overall revenue will decline slightly year-on-year in 2025, the number of service users will increase by 18% against the trend, which echoes the feature of “other products decline less than the average total revenue” in the annual report product data.
In August 2025, the company’s Shanghai waterproof material production base was completed, forming an “East-West Echo” pattern with the Chongqing base. The total investment in the project is 306 million yuan. After completion, it can produce 110,000 tons of water-based waterproof coatings, water-based adhesives and environmentally friendly mortars annually, laying a production capacity foundation for the large-scale development of the waterproof business.
Based on industry data, the gross profit margin of Weixing’s new material waterproofing business is about 25-30%, which is lower than that of PPR products but higher than the industry average. Through the “Kaletu” integrated service and “double warranty” commitment, differentiated competition is formed at the retail end and has become the core fulcrum of the company’s new business layout.
However, the performance decline of Weixing New Materials in the fourth quarter was even more obvious. Single-quarter revenue plummeted 19% year-on-year to 2.015 billion yuan; net profit attributable to the parent company was 201 million yuan, a year-on-year decrease of nearly 40%; non-net profit after deduction was 195 million yuan, a decrease of 36%.
This data is combined with quarterly, product and regional data. It is mainly due to the further contraction of demand in the fourth quarter of core markets such as East China and South China, as well as the increased decline in PE and direct sales channel business in the fourth quarter. It also reflects that the seasonal characteristics of the consumer building materials industry of “stable in the first three quarters and weak in the fourth quarter” are amplified in the downward cycle.
As the core segment of the company’s new business, the performance of the waterproofing business in 2025 has further strengthened the company’s ability to resist risks.
Although the waterproofing business included in other products in the annual report declined slightly year-on-year, the number of service users bucked the trend and increased by 18%, and operating income increased slightly year-on-year in Q3, reflecting the initial results of the company’s “pipe + waterproofing + water purification” whole-house water ecological strategy.
From the perspective of industry comparison, the overall growth rate of the waterproof industry in 2025 is low. However, Weixing’s new material waterproofing business collaborates through the “Star Butler” channel and relies on the existing distribution network to reduce customer acquisition costs. At the same time, it builds differentiation barriers with “double warranty” services, and the growth rate of the number of service users far exceeds the industry average.
The production capacity layout of the two major production bases in Shanghai and Chongqing has also laid the foundation for the subsequent large-scale growth of the waterproof business. According to the company’s plan, the waterproof business aims to exceed 5% of the market share within three years and is expected to become the company’s second growth core after PPR.
As for the goals for 2026, Weixing New Materials’ operating income target will strive to reach 5.70 billion yuan, and costs and expenses will strive to be controlled at around 4.720 billion yuan.
In addition, the operation and management work in 2026 will mainly focus on the following aspects: intensive cultivation and consolidating the main retail track.
Deepen the construction of the retail system, actively promote the “Weixing Water Ecology”, and collaboratively promote the high-quality development of the retail business through intensive market cultivation, deep customer cultivation and service empowerment, and continue to increase market share; transform and improve quality, and cultivate new momentum for the engineering business.
On the one hand, we will consolidate the base of high-quality customers, strengthen technical marketing, and create differentiated competitive advantages; on the other hand, we will adhere to “risk control first” to improve the quality of operations; we will accelerate our international layout and accelerate overseas market expansion.
Overseas business continues to deeply explore core markets and accelerate the layout of high-potential markets; Singapore Jetstream accelerates business expansion and transformation to accelerate development; research, production, sales and services are fully coordinated to jointly build core barriers.
Innovation-driven: Accelerate product iteration and system transformation to build comprehensive advantages in product, design and cost; Digital intelligence-driven: Accelerate the intelligent and flexible upgrade of production and manufacturing, and continuously strengthen the advantages of intelligent manufacturing; Service-driven: Standardize and lean upgrade of service system, build new service barriers; Continue to stimulate organizational vitality and ensure the effective implementation of strategies.
Continue to deepen organizational reform, promote process reengineering and optimize talent structure; focus on improving key capabilities to create a “professional, international, and hierarchical” talent team; strengthen cultural leadership and cultural influence, and take multiple measures to stimulate employee creativity and stimulate organizational vitality.
