KWG Group (1813) H1 2025 earnings summary

Executive summary

• Revenue for H1 2025 was RMB3,792.3 million, down 27.5% year-over-year, with all segments declining due to a sluggish real estate market and lower average selling prices.

• Net loss for the period was RMB2,171.7 million, a significant improvement from RMB8,133.0 million loss in H1 2024.

• Gross profit decreased 4.4% to RMB93.5 million, reflecting lower sales and continued market weakness.

• The company is undergoing debt restructuring and has not declared an interim dividend.

Financial highlights

• Property development revenue fell 30.5% to RMB3,072.6 million due to lower GFA delivered and reduced ASP.

• Property investment revenue dropped 9.2% to RMB406.1 million; hotel operation revenue declined 14.2% to RMB313.6 million.

• Other income and gains dropped 94.2% to RMB29.7 million.

• Finance costs fell 47.2% to RMB1,008.1 million.

• Income tax credits of RMB990.1 million were recorded, mainly due to reversal of prior accruals.

Outlook and guidance

• The company expects continued industry adjustment, focusing on core projects in the Greater Bay Area, cash flow management, and advancing debt restructuring.

• Policy support is anticipated to stabilize the market, but non-core cities remain under pressure.