Hevol Services Group Co. Limited released its audited results for the year ended 31 December 2025, posting a slight revenue decline but a sharp swing to loss amid weaker profitability and lower scale of managed projects.

Revenue slipped 0.6% year on year to RMB1.36 billion, while gross profit fell 12.40% to RMB306.26 million. Group gross margin contracted 3.0 percentage points to 22.6%.

The company reported a loss after tax of RMB48.67 million, reversing a profit of RMB86.62 million in 2024. Loss per share stood at RMB0.1155, compared with earnings per share of RMB0.0971 a year earlier.

Segment performance:

• Property management services revenue increased 1.26% to RMB1.09 billion, representing 80.4% of total turnover, yet segment margin narrowed to 19.5% from 22.2%. • Community value-added services, including leasing, delivered RMB244.92 million, down 5.06%, with margin sliding to 36.3% from 40.7%. • Value-added services to non-property owners generated RMB20.36 million, down 30.32%; margin was stable at 19.9%.

Operating cost pressures were evident as cost of sales rose 3.45% to RMB1.05 billion, driven by higher subcontracting, staff and maintenance expenses. Expected credit-loss provisions on trade and other receivables more than doubled to RMB111.97 million, while other income swung to a RMB31.24 million loss, mainly due to a RMB28.87 million loss on subsidiary disposals and a RMB4.82 million goodwill impairment. Administrative expenses fell 2.82% to RMB200.27 million.

Operational scale contracted during the year. Gross floor area (GFA) under management declined 12.2% to 54.60 million sq m across 355 projects, and contracted GFA fell 14.8% to 59.80 million sq m.

Total assets decreased to RMB1.61 billion (-5.6%), while net assets slid to RMB605.52 million (-21.3%). Cash and bank balances stood at RMB239.45 million, down from RMB273.71 million a year earlier. The group remained in a net cash position, with total interest-bearing borrowings at RMB102.22 million, all on fixed rates. Current ratio eased to 1.00x (2024: 1.13x). No final dividend was proposed.

Corporate actions included the disposal of 51% of Jiangsu Shenhua Times Property Group for RMB30.50 million, the acquisition of the remaining 30% stake in Guiyang Xinglong Property Management for RMB60.19 million, and the sale of 51% of Zhongshan Zhongzheng Property Management for RMB7.88 million.

Looking ahead, management reiterated focus on third-party project expansion, enhancement of service quality via “Red Property” initiatives, deeper penetration of non-residential sectors, and continued deployment of AI-enabled smart service solutions, while maintaining a prudent financial stance.