YUEXIU SERVICES Issues Profit Warning, Forecasts 45-50% Drop in Core Net Profit for 2025

Stock News
Feb 13

YUEXIU SERVICES (06626) announced that based on a preliminary assessment of the group's unaudited consolidated management accounts for the fiscal year ending December 31, 2025, and information currently available to the board, profit attributable to equity holders for 2025 is expected to decrease by approximately 20% to 25% compared to the previous fiscal year ending December 31, 2024. Core net profit is projected to decline by about 45% to 50% from the 2024 level. Core net profit is defined as profit attributable to equity holders excluding the impact of goodwill impairment. The expected decreases in both profit attributable to equity holders and core net profit are primarily attributed to a decline in gross profit margin, driven by the following factors: (1) A reduction in high-margin value-added services, such as brokerage businesses, due to the ongoing significant adjustment in the real estate sector; (2) The gradual completion of settlements for phased hard decoration services for residential properties, leading to reduced revenue and gross profit from this segment; (3) Increased overall operating expenses resulting from continued investments to enhance service quality and stabilize occupancy rates in commercial projects; (4) Rising labor costs due to policy adjustments. Looking ahead to 2026, the group will continue to pursue high-quality, long-term growth, actively adapt to industry changes, expand the scale of its non-residential business segment with a focus on quality, accelerate the restructuring of its value-added services, cultivate new profit growth drivers, and achieve structural optimization and efficiency improvements, taking solid steps toward its vision of becoming a "trusted smart city service provider."

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