According to Frost & Sullivan, the fourth quarter is generally considered a traditional peak season for the automotive industry, primarily driven by active nationwide auto shows and increased vehicle purchasing activities near year-end.
Business · p. 230
Consequently, our business has historically experienced, and we expect to continue to experience, relatively higher demand for our services in the fourth quarter of the calendar year.
Demand for e-bikes is generally stronger during the spring and summer months and weaker during the winter months due to reduced cycling activity in colder weather.
Business · p. 126
Given the lead time involved in sourcing components and manufacturing, as well as the limited flexibility to adjust production capacity in the short term, we typically prepare raw materials and production inventory approximately six months in advance of expected sales periods.
Business · p. 126
As a result, inventory levels are generally higher in the fourth and first quarters compared to other periods.
The demand for our products is significantly influenced by customers’ capital expenditure budgets, which are closely linked to macroeconomic conditions.
Business · p. 254
As a result, our operating results are closely correlated with prevailing macroeconomic conditions and may fluctuate with changes in the manufacturing investment cycle.
Business · p. 254
To diversify our revenue base and mitigate cyclicality, we intend to expand sales to customers in end markets with more favorable demand outlooks, particularly the automotive, lithium battery and electronics sectors, to support future growth.
Our business operations are subject to seasonal fluctuations, which are primarily in line with the procurement, budgeting, and project implementation cycles of our major customers, particularly those in the power and infrastructure sectors.
Business · p. 178
Generally, the first half of the fiscal year is focused on the initiation of bidding and procurement activities, while the completion, acceptance, and settlement of projects tend to be more concentrated in the latter half of the year.
Business · p. 178
We actively manage the impact of this seasonality by optimizing our manufacturing planning and ensuring efficient resource allocation throughout the year.
During the Track Record Period, we typically recorded higher revenue in the second half of each year, primarily because our customers generally conducted inspections upon project completion and confirmed their acceptance in the second half of the year.
Financial Information · p. 348
Such seasonality patterns can also affect our working capital and liquidity conditions, as well as the level of our inventory, contract assets and contract liabilities.
For the nine months ended September 30, 2025, our inventory turnover days increased to 369 days, primarily because the sales of our products are typically concentrated in the last quarter of the year, aligning with customer ordering patterns.
Financial Information · p. 297
Our inventories increased from RMB79.9 million as of December 31, 2022 to RMB135.3 million as of December 31, 2023, to RMB211.9 million as of December 31, 2024, and further increased to RMB362.4 million as of September 30, 2025, primarily in line with our expanded operations and growing demand for our products and to stock up to satisfy the higher demand in the last quarter of the year.
The demand for our products is affected by consumers’ consumption patterns. The demand for our products is typically relatively higher before traditional festivals, such as China’s Spring Festival, Mid Autumn Festival and National Day.
As a result of the foregoing, our revenue was lower in the first quarter of each financial year and higher in the fourth quarter of each financial year during the Track Record Period.
Business · p. 281
As a result of these factors, our revenue was lower in the first quarter of each financial year and higher in the fourth quarter of each financial year during the Track Record Period.
Our sales are generally higher in the second and third quarters of each year due to increased consumption driven by warmer weather.
Financial Information · p. 263
Conversely, the first and fourth quarters are generally low seasons with relatively lower revenue, which negatively affects our profitability during the same periods.
Our inventories increased from RMB1,674.1 million as of December 31, 2024 to RMB2,490.6 million as of September 30, 2025, mainly due to increased stocking of goods in anticipation of higher sales during the Mid-Autumn Festival and National Day, as well as to support our increased sales demand attributable to our expanded business.
Financial Information · p. 297
Our trade receivables further increased substantially to RMB153.1 million as of December 31, 2024, mainly because of our business growth, which resulted in an increased total amount of credit granted to the franchisees for the Special Purchase Day for Spring Festival.
Financial Information · p. 298
As of December 31, 2022, 2023, 2024 and September 30, 2025, all of our trade receivables were aged less than six months.
We typically experience peak sales in the fourth quarter of each year, where the holiday season and promotion activities occurs, and the off-season period in the second quarter of each year.
Financial Information · p. 353
Our trade receivables turnover days were 58.4 days, 96.2 days, 80.1 days and 97.6 days for the years ended December 31, 2022, 2023 and 2024 and the nine months ended September 30, 2025, respectively.
Demand for and sales of our products follow the same seasonality pattern as sales of the end products that feature our products.
Business · p. 199
As a result, we typically experience higher sales in the second and third quarters of the year due to the stock preparation of customers in response to the new product launch cycles and increased shopping activities during the holiday seasons.
Revenue is typically more widely distributed among our customers in the first half of the year, while major customers tend to make larger purchases in the second half for year-end project completions and inventory build-up, leading to higher revenue concentration.
Business · p. 207
This seasonal pattern is not uncommon in the industry and affects the revenue concentration ratio when comparing a six-month period against a full year.
Business · p. 207
The turnover days for our trade and bill receivables and long-term trade receivables increased to 225.4 days for the six months ended June 30, 2025, primarily because customers typically settle their outstanding balances toward the end of the year, and a larger portion of receivables remained outstanding as of June 30.
As a result of the timing of sales contracts and order fulfillment, we recorded higher sales volume in the second half of 2024 as compared to the first half of 2024, and we expect to experience a similar pattern in 2025.
During the Track Record Period, we generally recorded higher revenues for our products and solutions in the fourth quarter of the year, primarily because certain of our customers tend to finalize their annual procurement schedules and budgets during the first quarter of the year and complete their inspection and accept our products and solutions in the fourth quarter, which cause us to recognize revenue in the fourth quarter according to relevant revenue recognition policy.
Business · p. 225
According to Frost & Sullivan, this seasonal pattern is consistent with industry norms and reflects the procurement and budgeting cycles typical of medium to large enterprises and government entities in China.
Our sales generally peak during the fourth quarter, driven by major shopping events including Amazon Big Deal Day, Black Friday, and end-of-year holiday shopping seasons across our markets.
Business · p. 299
As a result, for the years ended December 31, 2022, 2023 and 2024, revenue generated in the fourth quarter accounted for 32.6%, 30.0% and 26.1% of our total annual revenue, respectively.
Our business exhibits clear seasonality due to the inherent characteristics of PS building construction, which is influenced by the environmental and social conditions of project locations.
Financial Information · p. 361
Similarly, the rainy season in Southeast Asia, such as Thailand, slows construction progress due to safety and quality concerns.
The occurrence of relatively low subsequent settlements in trade receivables as of October 31, 2025 is closely tied to the seasonal nature of our business operations.
Financial Information · p. 313
Historically, we have received a higher volume of orders from new and existing clients in the third and fourth fiscal quarters of each year due to the procurement and budgeting cycles of the clients, who tend to finalize their spending towards the end of the fiscal year to maximize their budget usage.
Financial Information · p. 313
Our R&D expenses decreased from RMB248.2 million in the six months ended June 30, 2024 to RMB168.1 million during the same period in 2025, primarily due to relatively lower demand for outsourced R&D in the six months ended June 30, 2025 as a result of seasonal business fluctuations, and the slowdown in technical service fee growth compared with the significant increase recorded in 2024, which was consistent with our R&D strategy to support our business growth in other diversified industries.
Our Impression — Dahongpao Scenery Show is subject to seasonality of the tourism market, statutory holidays and festivals throughout the year.
Business · p. 196
Throughout the Track Record Period, peak seasons primarily coincided with major holidays and school vacations.
Financial Information · p. 312
Our Directors believe that the fluctuations of our sales activities in respect of our signature show objectively reflect the seasonality for the broader cultural tourism industry in Mount Wuyi, which impacts our Moonlight over Mount Wuyi, Impression Cultural Tourism Town business and Chatang hotel business as well.
Our business is subject to seasonality. We experience seasonal fluctuations in our revenue and profitability.
Business · p. 229
Our hospitals generally experience more patient visits during the periods that are conducive to the spread of infectious diseases, particularly in the colder months of the fourth quarter.