Zhongtian Rocket to record an impairment of 100 million yuan in 2025—can the veteran space figure take over and pull off a comeback against the odds?

In 2025, Zhongtian Rocket (003009.SZ) entered a highly dramatic turning point.

This annual report, shaped by interwoven losses of hundreds of millions of yuan, asset impairment of more than 100 million yuan, and a major reshuffle of the core management team, unveils the truth about this aerospace-related listed company’s “financial makeover” and strategic transformation amid multiple cycles squeezing it from all sides.

Over the past three years, Zhongtian Rocket’s profit kept declining for three consecutive years—from parent-attributable net profit of RMB 96.0127 million in 2023 and RMB 19.57 million in 2024, down to a cliff-like drop to -1.02 hundred million yuan in 2025. In addition, high-provision impairment charges are also a key reason for the losses.

On one hand, its weather modification business (hereinafter referred to as the human impact business) has continued to consolidate steadily. The cumulative bid-winning scale of government bond projects reached RMB 340 million, hitting a historical high.

On the other hand, core businesses such as carbon/carbon hot-field materials have been hit by the severe cold of the industry cycle, leading to a decline in profitability and a year-over-year contraction in revenue scale.

Against the backdrop of performance pressure for three straight years, Zhongtian Rocket pressed the “fast-forward key” of personnel reform in 2025. Cheng Hao, who has a deep background in Chaomai Technology and experience at the Fourth Academy of Aerospace, took over as chairman, supported by a hands-on bench of “research + capital” operating on two fronts.

With the newly appointed management team officially stepping into their roles, whether Zhongtian Rocket can leverage its aerospace technology foundation to break through the photovoltaic cycle and convert “resilience in output value” into “financial statement profitability” has become the key to determining whether its future valuation can be reshaped.

Performance Plunge

On March 30, Zhongtian Rocket disclosed its 2025 financial report, presenting an extremely stark sense of “tearing”: on one side, the production end is running at full power and market share is stable; on the other side, the financial statements show eye-catching losses of massive amounts.

During the reporting period, the company realized operating revenue of RMB 783 million, down 15.32% year over year. The most striking data is that it recorded a parent-attributable net profit loss of RMB 102 million, with a year-over-year decline as high as 620.65%.

Looking through the financial report, it can be seen that this “performance plunge” was not caused entirely by a collapse of operating businesses, but instead stemmed from a heavy one-time provision.

Zhongtian Rocket said that, based on the principle of prudence, it accrued RMB 92.0928 million in asset impairment provisions and RMB 12.2730 million in credit impairment losses. These two items together reduced profit by RMB 104 million, strongly offsetting the company’s full-year profit space.

What is worth paying attention to is that although net profit is mired in trouble, since the impairment is a “non-cash cost,” it did not result in an actual cash outflow. The company still maintained a positive net cash flow from operating activities.

In terms of product structure, Zhongtian Rocket’s rain enhancement and hail suppression rockets, as well as supporting equipment, increased 39.87% year over year, accounting for more than 50% of revenue.

Meanwhile, the “growth engine” that had been highly anticipated—carbon/carbon hot-field materials—saw a sharp decline of -41.87% year over year. At the same time, its military small solid rockets fell 54.04% year over year. Together, these two business segments account for more than 30% of revenue and have become important factors dragging down performance.

In addition, the intelligent weighing system and measurement and control system integration have nearly come to a standstill, down 90.82% year over year. However, this segment’s revenue share is less than 1%, so it is difficult to affect the overall financial picture.

Zhongtian Rocket’s current situation is a typical case of manufacturing capability pushing upward while pressure on the financial statements pushes downward.

On the production side, the company still maintains strong delivery capability. In particular, production of human impact rockets reached 88,000 rounds, up 42% year over year; production of various igniters reached 45,000 units, up 71%; and production of launch frames reached 1,200 units, up 226%. The output of core products substantially exceeded the expected targets.

This resilience on the production side contrasts sharply with the decline on the sales side, reflecting changes in pricing power in downstream markets, a lengthening of customer settlement cycles, or inventory digestion pressure brought about by excess industry capacity.

Pain of the Cycle

Under the dual blows of the downturn in the photovoltaic cycle and setbacks to emerging businesses, a top-down “major reshuffle” of the core management team became the company’s last card in its attempt to turn things around.

With the awkward situation that traditional businesses can’t carry the weight on their own, the multi-pivot strategy Zhongtian Rocket has promoted in recent years is now facing survival tests unprecedented in difficulty. Confronted with three consecutive years of performance declines, Zhongtian Rocket pressed the “fast-forward key” for personnel reform in 2025.

Cheng Hao, who has a solid background in the Fourth Academy of Aerospace, officially took over as chairman. It is worth noting that Cheng Hao had long been in charge of the subsidiary Chaomai Technology, and that company is precisely the core operating entity for hot-field materials and burn-resistant and erosion-resistant components. This appointment appears to precisely signal the strategic intent of “getting back up from where you fell,” aiming to reverse the downturn by deeply reorganizing core assets.

The subsequent selection and appointment of the general manager leaned toward a “battle-tested, hands-on” style. The newly appointed general manager, Li Huaien, has more than 30 years of experience in scientific research management. Deputy general manager Ning Xinghua has deep accumulation in asset management and capital operations.

This new team, made up of veterans from the “aerospace group,” faces an extremely challenging business question.

First is reducing inventory and improving efficiency through cost reduction. In the context of how the photovoltaic hot-field materials industry cycle affects the business, how will the new management use past experience to quickly optimize process routes, digest inventory, and stop the “bleeding points”?

Second is rebalancing the business structure. Although the winning amount of the human impact business reached a new high of RMB 340 million, its ceiling is visible. Whether the new team can leverage its deep resources in aerospace systems to open up a new growth engine for high-value-added products such as military small rockets will determine whether Zhongtian Rocket can reshape investors’ long-term confidence.

For Zhongtian Rocket, this “major reshuffle” in personnel is only the prologue. Whether it can achieve a second coupling between technology and the market during the cold winter of the cycle is the “touchstone” for testing the quality of the newly appointed management team.

(Author: Lingchen; Editor: Luo Yifan)

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