Binjiang Services' profit last year was approximately 600 million yuan, and the parent company Binjiang Group still focuses mainly on the Hangzhou and Shanghai regions.

On March 26, at the 2025 performance briefing held by Binjiang Services (03316.HK), management discussed the current property industry, stating that the overall situation remains severe.

Binjiang Services’ disclosed 2025 results show an annual revenue of approximately 4.101 billion yuan, an increase of 14.1% year-on-year. Of this, property management service revenue is about 2.441 billion yuan, up 26.3% YoY; non-owner value-added service revenue is approximately 471 million yuan; and 5S value-added service revenue is about 1.188 billion yuan, an 8.3% increase YoY.

The company’s gross profit is around 909 million yuan, up 8.9% YoY, with a gross profit margin of 22.2%. Annual profit is approximately 609 million yuan, a 10.1% increase YoY; profit attributable to equity shareholders is about 595 million yuan, up 9%; net profit margin is 14.9%. Deposits and bank wealth management total about 3.692 billion yuan, up 12.5% YoY; net operating cash inflow is approximately 828 million yuan, an increase of 47.7%.

As of the end of 2025, Binjiang Services’ managed area was 82.62 million square meters, a 21.6% increase YoY; contracted area was about 104 million square meters, up 12.3%. The new awarded stock residential projects for the year totaled 4.067 million square meters, a 28% increase. Among these, nine projects were awarded at a premium, and the company’s managed area from independent third parties accounted for 56.5%.

In 2025, the average property management fee (calculated as property management service revenue divided by the average of the beginning and end of reporting period chargeable building area) is approximately 4.2 yuan per square meter per month (compared to 4.1 yuan in 2024).

According to Sina Finance from the investor performance meeting held that day, management acknowledged that the current market environment is definitely severe. When asked about how to respond, management stated that the overall development of the property industry is slowing down. Under significant cost and profit pressures, and with the entire industry focusing on reducing costs and increasing efficiency, the company has taken corresponding measures. Instead of layoffs, the company has improved operational efficiency and profits through energy-saving expenses and management fee rate reductions.

Management further noted that from their own operational experience, from the second half of 2025 to now in 2026, the company’s market recognition has improved, and the success rate of taking over projects has increased compared to before. They emphasized that they aim to ensure steady growth in key operational indicators and revenue for at least this year and 2027.

Regarding the parent company Binjiang Group, management said that after several years of industry optimization and financial restructuring, the current debt-to-cash ratio is about 1:1, with more cash on hand. This ensures the company’s funds remain absolutely safe even in extreme market conditions. The company will maintain a roughly 1:1 ratio of cash to interest-bearing debt, avoiding excessive increases in interest-bearing liabilities.

Regionally, management stated that the company will continue to focus on Hangzhou and Shanghai. Since the Lunar New Year, the Hangzhou market has shown a clear rebound, with daily sales increasing by about 50% compared to before the holiday. Shanghai’s second-hand housing transactions also reached a new weekly high in five years. Overall, the real estate markets in Hangzhou and Shanghai have significantly improved after the Lunar New Year, further confirming the value and necessity of the company’s previous strategic contraction. The company will continue to prioritize these two cities for real estate development.

Additionally, management said that the sales target set before 2026 is 80 billion yuan. As the market warms up, Binjiang Group is expected to participate more actively in land auctions in Shanghai and Hangzhou. If more land is acquired, the sales target may be adjusted upward accordingly.