Yantai Linghua New Material Co., Ltd. 2025 Annual Performance Summary Report

Yantai Linghua New Material Co., Ltd. 2025 Annual Performance Summary Report

– Dual Engines Drive, Steady Growth, Quality Opens the Future

The year 2025 marked a pivotal year for Linghua New Material in implementing its “Dual Engines Drive by TPU Pellets and High-end Films” strategy. Facing a complex market environment, we leveraged our deep expertise in polyurethane materials to achieve synergistic development across the entire chain, from upstream raw materials to downstream high-value-added film products. The company made significant achievements both in the customized development of modified TPU pellets and in the quality breakthrough of TPU PPF (Paint Protection Film) base films. We have not only solidified our leading position in the high-end PPF substrate sector but also carved out new growth avenues in pellet sales for emerging applications. All colleagues, with innovation and craftsmanship, have collectively written a new chapter in Linghua’s high-quality development.

I. Performance Overview: Success on Both Fronts, Exceeding All Targets

In 2025, focusing on the annual goal of “consolidating the pellet foundation and strengthening the film growth driver,” the two major business segments worked in synergy, with all key performance indicators surpassing expectations.

II. Market & Sales: Dual Engines Drive, Optimized Structure

The company precisely implemented a differentiated market strategy, with the two business segments supporting each other, significantly enhancing competitiveness.

1. Strong Synergistic Growth: Annual sales revenue achieved robust 32% year-on-year growth. The TPU PPF film business, with its superior optical and weatherability performance, became the main growth driver, with revenue up 40%. The TPU pellet business, as the cornerstone, maintained stable demand in traditional strongholds like footwear, wearable devices, and industrial transmission, and achieved 18% healthy growth by tapping into new markets like new energy vehicle interiors.
2. Remarkable Success of Premiumization Strategy: PPF film products successfully entered the supply chains of 5 top domestic brands, with market share in the high-end segment jumping to 38%. For pellets, the sales proportion of “specialized, sophisticated, distinctive, and innovative” grades like high-transparency, high-wear-resistance, and hydrolysis-resistant types increased to 30%, continuously optimizing the customer portfolio.
3. New Steps in Global Layout: PPF films achieved first-time batch exports to the European high-end aftermarket. Specialty TPU pellets received certification from several multinational consumer goods manufacturers, laying a solid foundation for a full-scale entry into international high-end manufacturing supply chains in 2026.

III. R&D & Innovation: Chain Innovation, Mutual Empowerment

The company established a chain-type R&D system integrating “fundamental material research and end-use application development,” enabling mutual empowerment between pellet and film technologies.

1. Core Technology Breakthroughs: At the pellet level, successfully developed an ultra-low VOC aliphatic TPU formula, ensuring extremely low fogging value (<1.5mg) and yellowing resistance (ΔYI<3) for PPF films from the source. At the film level, conquered the interlayer stress control technology in multi-layer co-extrusion casting, stabilizing base film thermal shrinkage below 0.7%.
2. Enriched New Product Portfolio: Launched 7 new pellet and 2 new film products throughout the year, including the ”Rock-Solid” series high-rigidity injection pellets, “Soft Cloud” series high-elasticity film-grade pellets, and the ”Crystal Shield MAX” dual-coating PPF film substrate, meeting diverse market needs.
3. IP and Standard Development: Filed 10 patents for the year, led/participated in revising the industry standard Thermoplastic Polyurethane (TPU) Film. The internally built ”Pellet-Film” Performance Correlation Database has become a core knowledge asset guiding product development and customer service.

IV. Production & Operations: Lean & Smart Manufacturing, Flexible & Efficient

To support dual business development, the company continued advancing the intelligent and flexible transformation of its production system.

1. Precision Capacity Expansion: The Phase II cleanroom for PPF film production commenced operation, increasing capacity by 35%, equipped with a fully automated online defect detection system. The pellet sector completed flexible upgrades on key lines, enabling rapid response to small-batch, multi-variety orders, with changeover efficiency improved by 50%.
2. Deepened Lean Operations: Fully implemented MES (Manufacturing Execution System) and APS (Advanced Planning and Scheduling), linking pellet production planning with film scheduling to optimize inventory and delivery cycles. The company was recognized as a “Shandong Province Smart Manufacturing Benchmark Workshop.”
3. Vertical Supply Chain Integration: Extended upstream by signing long-term strategic agreements with major monomer suppliers (e.g., adipic acid) to mitigate raw material price volatility. Collaborated downstream by establishing a ”Pellet-Base Film-Coating” Joint Lab Platform with key coating customers for co-development and product iteration.

V. Quality & Systems: End-to-End Coverage, Benchmark Leadership

Quality control spans the entire process from a single pellet to a finished film roll, establishing a quality assurance system that exceeds customer expectations.

1. Comprehensive System Upgrade: Successfully obtained IATF 16949 certification and concurrently applied the stringent automotive industry control standards to the production management of high-end pellet products. Released Linghua’s Internal Grading Standard for Automotive-Grade TPU Pellets, leading the industry in quality grading.
2. Precision Process Control: Achieved online monitoring and closed-loop control of key process parameters (e.g., viscosity, molecular weight distribution) in pellet production. For films, utilized big data analytics to predict quality trends, improving the process capability index (Cpk) from 1.33 to 1.67.
3. Demonstrated Customer Value: PPF film Grade A rate remained stable above 99.5%, with zero major customer complaints for the year. Pellet products, recognized for exceptional batch-to-batch consistency, became designated ”skip-lot inspection” materials for several customers.

VI. Financial Performance: Optimized Structure, Healthy Development

The company’s product mix continuously optimized towards high-tech, high-value-added directions, strengthening its financial foundation.

• Revenue & Profitability: While revenue grew rapidly, the increased proportion of high-margin products further enhanced overall profitability and risk resilience.
• Cash Flow & Investment: Strong operating cash flow continued to fuel R&D innovation and smart upgrades. Strategic investments focused on enhancing core competitiveness.
• Assets & Efficiency: Operational efficiency indicators like total asset turnover and inventory turnover improved consistently, significantly boosting the value-creating capability of assets.

VII. Outlook for 2026: Synergistic Progress, Ecosystem Win-Win

Looking ahead to 2026, Linghua New Material will embark on a new journey centered on “Deepening Synergy, Building Ecosystems”:

1. Market Synergy: Promote ”Pellet + Film” Combo Solution Marketing, offering brand customers integrated solutions from material to finished product, enhancing customer loyalty and share of wallet.
2. Technology Ecosystem: Establish the “TPU Materials & Applications Joint Innovation Lab,” inviting leading downstream customers and universities to collaborate, driving innovation from the source of demand.
3. Zero-Carbon Manufacturing: Launch the “Green Linghua” initiative, developing bio-based TPU pellets, and plan for integrated photovoltaic and energy storage facilities, fulfilling sustainability commitments.
4. Talent Development: Implement a “Dual-Career-Path” talent development system, cultivating compound leaders proficient in both material science and market applications.

Conclusion

The outstanding achievements of 2025 stem from our profound understanding and relentless pursuit of TPU materials science, and more importantly, from the foresight and steadfast execution of the “Dual Engines” strategy. Linghua New Material is no longer just a product supplier but is evolving into an innovative partner capable of providing customers with systematic material solutions. In the future, we will continue to use pellets as our foundation and films as our spearhead, joining hands with global partners to co-create a new era of more performant and sustainable materials.