The company recently released its annual report for 2023. The annual operating revenue was 98.13 billion yuan, down 18.4% year on year, and the net profit attributable to the parent company was 0.89 billion yuan, down 85.5% year on year.
The development business income and gross profit margin both decreased, and the provision for impairment affected the performance. In 23 years, the company realized a revenue of 98.13 billion yuan, down 18.4% year on year, mainly because the settlement area of the company's real estate projects decreased by 21.13% year on year to 4.8634 million square meters, and the settlement revenue decreased by 21.72% year on year to 85.469 billion yuan. The net profit attributable to the parent company in 23 years was RMB 0.89 billion, down 85.5% year on year, and the decline in performance was greater than that in revenue, mainly because the gross profit margin of development business settlement decreased by 3.8 pct to 16.2%, the net investment income decreased by 50.8% year on year to RMB 1.96 billion, and the superimposed impairment loss of credit and asset provision was RMB 3.37 billion (the impairment in 22 years was RMB 4.73 billion). In 23 years, the newly started area of the company was about 3.13 million square meters, and the completed area was about 13.43 million square meters. In 24 years, the company planned to complete an area of 10.74 million square meters, providing support for the settlement volume.
The sales end shrinks, and land acquisition focuses on the refined storage expansion of high-energy cities. In 23 years, the company achieved a contracted area of 8.77 million square meters, with a contracted amount of 153.6 billion yuan, down 14% and 30.8% respectively year on year, and its sales performance remained the first echelon in the industry. The industry went down faster than expected. The company optimized the allocation of investment resources, and added about 950000 cubic meters of soil reserves in core cities such as Shanghai, Hangzhou, Nanjing, Xi'an, with a total investment of about 12.5 billion yuan. By the end of 23, the total land reserve of the company was about 41 million square meters, and the equity land reserve was about 18 million square meters, of which the first and second tier cities accounted for about 73%.
Interest bearing liabilities were further reduced to actively cope with debt repayment pressure. By the end of the 23rd year, the company's interest bearing debt balance was 91.9 billion yuan (- 20.2%), of which bank borrowings accounted for 75.5% and open market financing accounted for 24.5%; The asset liability ratio after excluding advance receipts is 61.3%, and the weighted average cost of debt financing is 4.36%. The company's public bonds have been fully paid in the first quarter of the 24th year. As of April 23, the balance of the company's domestic debt in 24 years was 6.5 billion yuan, the repayment peak in the first half of the year was from May to June (3.5 billion yuan), and from November to December in the second half of the year (3 billion yuan). The only foreign debt will be due in August of 24 years, with a balance of 480 million dollars; The balance of domestic debt declined significantly in 25 and 26 years, to 2.2 billion yuan and 0.5 billion yuan respectively. The company actively responds to the pressure of debt repayment, and existing development projects and operational properties may be financing windows.
It was downgraded to the overweight rating, and the target price was lowered to 3.74 yuan. According to the 2023 annual report data, we adjusted the forecast of the company's revenue growth rate, gross profit margin of various businesses, and sales management expense rate. After the adjustment, the net assets per share in 24-26 years are respectively 14.40, 14.52, and 14.63 yuan (the original forecast is 16.58 and 17.68 yuan in 24-25 years). The average PB of comparable companies in 2024 is 0.26 times, and the corresponding target price is 3.74 yuan.
Risk tip: sales and settlement are not as expected. Policy easing was less than expected. The corporate financing environment tightened more than expected. Risk of asset impairment loss. The ground was not as expected.
