Lushang Life Services (2376) H1 2024 earnings summary

Executive summary

• H1 revenue was RMB308.5m, down 1.7% against the pre-restatement comparator; net profit was RMB21.9m, down 28.9%, and profit attributable to owners was RMB21.7m, down 27.7%.

• Managed 97 projects with 23.5m sq.m. of GFA, down 1.3% YoY; contracted area was 26.8m sq.m., down 2.2%.

Financial highlights

• Revenue fell 50.8% against restated H1 2023 revenue of RMB627.3m, reflecting the common-control acquisition restatement and cessation of Daantong’s former real estate and leasing businesses.

• Gross profit was RMB60.5m, down 11.0% against the pre-restatement comparator of RMB67.9m; gross margin was 19.6% versus 21.6%. Against restated results, gross profit fell 22.3% and margin rose from 12.4%.

• Net profit of RMB21.9m was down 0.3% from restated RMB22.0m; profit attributable to owners was RMB21.7m versus restated RMB21.2m.

• Operating cash flow was negative RMB52.9m versus negative RMB34.3m in restated H1 2023; cash and cash equivalents were RMB385.0m at June 30, 2024.

Outlook and guidance

• No material investment or capital-asset plan was in place; business development opportunities will continue to be assessed.

• Remaining listing proceeds and their expected utilization schedule remain subject to business development and market conditions; Daantong is focusing on elevator maintenance and installation after ceasing its former real estate business.