Runhua Living Service Group Holdings (2455) H1 2024 earnings summary

Executive summary

• H1 revenue rose 11.3% YoY to RMB407.5m, while profit fell 13.9% to RMB17.5m as gross margin compressed and costs increased.

• Property management remained the core business, contributing 93.2% of revenue; no interim dividend was declared.

Financial highlights

• Revenue increased 11.3% YoY to RMB407.5m; cost of services rose 16.0% to RMB346.2m.

• Gross profit fell 9.7% to RMB61.3m; gross margin declined to 15.0% from 18.5%.

• Profit for the period decreased 13.9% to RMB17.5m; basic and diluted EPS was RMB0.06 versus RMB0.07.

• Adjusted for prior-period listing expenses of RMB2.5m, administrative expenses declined to RMB34.4m from RMB37.7m.

Outlook and guidance

• Strategy targets greater share in existing Shandong markets through acquisitions and partnerships, with expansion into the Yangtze River Delta and Beijing-Tianjin-Hebei regions.

• Part of global offering proceeds remains intended for acquiring a property management business; use-of-proceeds plans were unchanged.

• Management cited expected growth in China’s economy, urbanization and new residential and non-residential properties as market opportunities.