PropNex (OYY) H2 2023 earnings summary

Executive summary

• FY2023 revenue fell 18.6% to $838.1m and net attributable profit declined 23.3% to $47.8m amid weaker property transactions and project marketing.

• 2H2023 revenue and net attributable profit rose 30.1% and 16.8% versus 1H2023, though the improvement did not offset full-year declines.

• 2023 market shares remained strong across key segments, with 47.9% in new launches, 65.8% in private resale and 64.7% in HDB resale.

Financial highlights

• FY2023 gross profit was $81.0m, down 22.6%, with gross margin of 9.7% versus 10.2%; profit before tax fell 24.8% to $59.5m.

• Profit for the year declined 24.1% to $49.6m; net attributable profit fell 23.3% to $47.8m.

• 2H2023 revenue was $473.8m, down 14.9% YoY; gross profit was $45.2m, down 20.6%, and net attributable profit was $25.8m, down 27.1%.

• Agency services commission income declined 7.7% to $591.1m; project marketing commission income fell 36.9% to $242.3m.

• Finance income rose to $4.5m from $1.2m; other income fell 51.1% to $7.9m, while other expenses increased 48.4% to $19.4m.

Outlook and guidance

• 2024 forecasts: private home prices up 3%–4%, HDB resale prices up 4%–5%; HDB resale volume 26,000–27,000, private resale 13,000–14,000 and new-home sales 7,000–7,500 units.

• The 2024 marketing pipeline included 109 projects and 15,922 units; 33 appointed projects with 10,587 units were expected to launch.

• Nearly 10,000 private residential units were expected to complete in 2024; more than 13,000 HDB flats and 1,386 EC units were expected to reach MOP.

• Plans included growing the salesforce from 12,233 to 15,000 by 2026 and increasing IT development and training investment; buying sentiment could improve with economic growth and potential rate easing.