Yuexiu Property Company (123) H2 2024 earnings summary

Executive summary

• Revenue grew 7.7% year-over-year to RMB86.40 bn, but gross profit margin fell by 4.8 percentage points to 10.5%.

• Contracted sales value declined 19.4% year-over-year to RMB114.54 bn, outperforming the top 10 developer average decline.

• Net operating cash inflow surged to RMB21.73 bn from RMB8.35 bn in 2023, with cash on hand rising 8.6% to RMB50.05 bn.

• Maintained strong liquidity, improved debt structure, and adhered to long-term sustainable development strategies.

• No final dividend declared for 2024; total dividend for the year was HKD0.189 per share, a payout ratio of 44% of core net profit.

Financial highlights

• Gross profit fell 26.1% year-over-year to RMB9.05 bn; gross margin dropped to 10.5% from 15.3%.

• Profit attributable to equity holders declined 67.3% to RMB1.04 bn; core net profit down 54.4% to RMB1.59 bn.

• EPS decreased 69.7% to RMB0.2584; annual dividend per share halved to RMB0.173.

• Net gearing ratio improved to 51.7% from 57.0%; total borrowings slightly decreased to RMB103.89 bn.

• Weighted average borrowing interest rate decreased to 3.49%.

Outlook and guidance

• 2025 contracted sales target set at RMB120.5 bn, with total sellable resources of RMB235.4 bn.

• Management expects moderate global economic recovery in 2025, with China continuing proactive measures to stabilise the real estate market.

• Focus remains on accelerating sales, destocking, prudent investment in tier-1 and quality tier-2 cities, and enhancing operational efficiency.

• Fiscal and monetary policies anticipated to loosen, supporting industry recovery and developer financing.

• Continued emphasis on cost control, digital marketing, and ESG initiatives.