Core Viewpoint - The leading company in the domestic funeral industry, Fushouyuan International Group Co., Ltd., has announced its first profit warning since its listing, projecting a loss of between 235 million to 265 million yuan for the first half of 2025, compared to a net profit of approximately 299 million yuan in the same period last year, marking its first loss since its IPO in 2013 [1][2] Group 1: Financial Performance - Fushouyuan's revenue peaked at 2.628 billion yuan in 2023 but fell by 20.95% to 2.077 billion yuan in 2024, while net profit dropped by 49.04% from 976 million yuan in 2023 to 497 million yuan in 2024, returning to levels seen in 2016 [2][4] - The company's operating cash flow decreased from 1.103 billion yuan in 2023 to 709 million yuan in 2024, indicating a significant decline in cash generation [4] Group 2: Business Segments and Challenges - The main revenue source for Fushouyuan comes from three segments: cemetery services, funeral services, and other services, with cemetery services accounting for 82.3% of total revenue, which decreased by 21% to 1.709 billion yuan in 2024 [4][10] - The company faces challenges such as high goodwill, increased inventory turnover days, and a cautious consumer spending environment influenced by macroeconomic factors [2][5][10] Group 3: Market Trends and Consumer Behavior - The funeral industry is experiencing a shift in consumer behavior, with a growing preference for alternative burial methods and a trend towards "thick nurturing and thin burial," impacting traditional cemetery service sales [7][8] - Despite rising prices in the high-end cemetery market, with average sales prices increasing from 1.025 million yuan in 2018 to approximately 1.212 million yuan in 2024, the company is facing inventory management issues due to prolonged inventory turnover days, which reached a historical high of 694.61 days in 2024 [7][8][10]

Core Viewpoint - Fushouyuan International Group Limited has issued its first profit warning since its listing in 2013, expecting a loss of approximately 235 million to 265 million yuan for the first half of 2024, compared to a profit of about 298.8 million yuan in the same period last year [1][3]. Financial Performance - For the first half of 2024, Fushouyuan anticipates total revenue of approximately 2.0775 billion yuan, a year-on-year decrease of about 20.9%, and a profit attributable to shareholders of approximately 373.1 million yuan, down 52.8% [5]. - The company reported a revenue of 1.1 billion yuan for the mid-2024 period, reflecting a year-on-year decline of 27.97%, with a shareholder profit of 298.8 million yuan, down 35.7% [5]. - The revenue primarily comes from three segments: cemetery services, funeral services, and other services, with cemetery services accounting for 82.3% of total revenue at 1.709 billion yuan, a decrease of 21% [5]. Business Operations and Market Trends - The decline in performance is attributed to macroeconomic factors and cautious consumer spending, alongside increased tax costs for some subsidiaries and impairment provisions for goodwill and related assets [3][5]. - The company has noted a shift in consumer behavior towards more economical burial options, with a growing preference for ecological burials and other alternatives, impacting traditional cemetery sales [5]. - As of December 31, 2024, Fushouyuan has approximately 2.83 million square meters of land available for cemetery sales, with a decrease in the number of operational graves sold by 3,816 units compared to 2023 [5]. Strategic Initiatives - Fushouyuan aims to optimize operational management, enhance service efficiency, and respond to public welfare policies while leveraging technology to maintain its leadership in the funeral technology sector [3]. - The company plans to continue its expansion strategy, seeking suitable development opportunities and integrating resources within the fragmented Chinese funeral industry to increase market share [6]. - Fushouyuan intends to transform from a funeral service provider to a life and funeral technology service provider, focusing on growing its cremation machine business and expanding its service offerings through innovative collaborations with local governments [6]. Market Reaction - Following the profit warning announcement on August 6, 2024, Fushouyuan's stock price opened lower, experiencing a drop of 9.09% to close at 3.3 HKD, and further declined to 3.28 HKD by August 8, 2024, with a total market capitalization of 7.6 billion HKD [6].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責， 對其準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部或任何 部分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 – 1 – 儘管本報告期受到週期性調整的壓力，本集團通過前瞻性戰略佈局和精準成本管 控，仍展現出強大的經營韌性，並積極應對市場挑戰，構建盈利質量的護城河，使 本集團的扣除非經常性損益後淨利潤率依舊保持較高水平。未來，本集團將持續優 化運營管理，實現服務效能的提升，積極響應惠民利民政策，並通過加速科技賦能 和打造智能服務生態，以鞏固殯葬科技領軍者地位。同時，本集團將保持穩健的現 金流和財務結構，保持利潤分配的連續性和穩定性，推動股東回報沿較高增長曲線 發展，構建具有長期投資價值的企業。 截至本公告日期，本公司仍在落實本集團截至二零二五年六月三十日止六個月之綜 合財務資料。本公告所載之資料僅根據本公司管理層參考現時可得資料（包括本集 團截至二零二五年六月三十日止年度未經審核管理賬目）作出之初步評估而得出， 有關綜合管理賬目尚未經本公司核數師審核或經本公司審核委員會審閱，有待落實 及作出必要調整（如有）。本公 ...

呈交日期: 2025年8月1日 股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 截至月份: 2025年7月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 福壽園國際集團有限公司 I. 法定/註冊股本變動 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | | 於香港聯交所上市 (註1) | | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 01448 | 說明 | | | | | | | | | | | 法定/註冊股份數目 | | | 面值 | | | 法定/註冊股本 | | | 上月底結存 | | | 20,000,000,000 | USD | | 0.01 | USD | | 200,000,000 | | 增加 / 減少 (-) | | | 0 | | | | USD | | 0 | | 本月底結存 | | | 20,000,000,000 | USD | | 0.01 | USD | | 200,000,000 | 本 ...

Group 1: Regulatory Changes and Industry Trends - The Ministry of Civil Affairs has released a draft for the revised Funeral and Interment Management Regulations, expanding the original regulations to 8 chapters and 57 articles, focusing on public welfare and clarifying government responsibilities [1] - The revisions aim to establish a basic public service system for funerals, curb industry chaos, and reinforce the government's commitment to safeguarding public welfare [1] Group 2: Company Strategy and Digital Transformation - Fushouyuan is embracing industry changes and focusing on balancing public welfare with market efficiency, aiming to create long-term sustainable social value [1] - The company is undergoing a transformation from traditional funeral services to becoming guardians of life value, driven by the increasing demand for spiritual and cultural services [2] - Fushouyuan's digital transformation includes upgrading management systems and enhancing customer experience through technology and data-driven approaches [2][3] Group 3: ESG and Sustainable Development - Fushouyuan has achieved a significant milestone by upgrading its MSCI rating from AA to AAA, placing it in the top 1% of the MSCI China investable market index [3] - The company has implemented initiatives such as achieving 97% smoke-free parks and increasing the proportion of eco-friendly products, reflecting its commitment to sustainability [3] - Fushouyuan is pioneering a "digital life + life education" service model, promoting industry value reconstruction through the integration of ESG factors into its core business [3] Group 4: Shareholder Returns and Financial Strategy - Since its listing in 2013, Fushouyuan has maintained a dividend payout ratio of over 25%, with a commitment to increase the payout ratio to at least 35% and gradually to 60% or more starting from 2022 [4] - The stable cash flow characteristic of the funeral industry supports the company's high dividend policy, reflecting confidence in its internal growth and consideration for shareholder interests [4] - Fushouyuan is leading the digital transformation of the traditional funeral industry, utilizing technology to preserve memories and convey emotions, thereby redefining life services in modern society [4]

Financial Performance - The company reported a revenue of RMB 2,077.5 million and a net profit of RMB 497.3 million for the fiscal year 2024[10]. - The company recorded a total comprehensive income attributable to shareholders of RMB 373.1 million for the fiscal year 2024[10]. - The total revenue for the company in the current year reached RMB 2,077.5 million, a decrease of approximately 20.9% compared to the previous year[42]. - The profit attributable to shareholders and comprehensive income was RMB 373.1 million, down about 52.8% year-on-year[42]. - Revenue from cemetery services amounted to RMB 1,709.2 million, accounting for 82.3% of total revenue, while revenue from funeral services was RMB 339.2 million, representing 16.3% of total revenue[43]. - The number of operating graves sold decreased by 3,816 units or 23.3%, leading to a revenue decline of RMB 435.1 million or 22.2% in cemetery services[45]. - The company achieved sales of 16,504 burial plots and provided various funeral services to 65,143 families, generating a total revenue of RMB 2,077.5 million and a net profit of RMB 497.3 million, with RMB 373.1 million attributable to shareholders[114]. - The company faced risks related to strict government regulations in the funeral industry, which may impact business expansion and operational flexibility[115]. Dividends and Shareholder Returns - Shareholders will receive a final dividend of HKD 0.0954 per share, totaling an annual dividend of HKD 0.5474 per share, in line with the company's dividend policy[10]. - The company declared a special dividend of HKD 0.3882 per share, to be paid in three installments: HKD 0.1724 on April 25, 2025, HKD 0.1079 on July 25, 2025, and HKD 0.1079 on October 31, 2025[133]. - The company plans to distribute at least 35% of annual distributable net profits to shareholders starting from the fiscal year ending June 30, 2022, with annual reassessment of the dividend policy[133]. Market and Industry Trends - 2024年中國60歲及以上人口達到31,031萬人，佔比22.0%，顯示人口老齡化加劇[20]. - 2024年中國的死亡人口為1,093萬人，遺體火化率達到58.8%[20]. - 隨著城鎮化率提高至67.0%，將催生對殯葬基礎設施的廣泛需求[20]. - The cremation rate in China is increasing, driven by rising disposable income and urbanization, leading to a higher demand for diverse and quality funeral services[28]. - The ongoing reforms in the funeral sector are expected to raise entry barriers for new and existing participants, fostering a more competitive environment[25]. Corporate Strategy and Transformation - The company is transitioning from a traditional funeral service provider to a life technology service provider, emphasizing digital transformation and innovation[11]. - The company aims to enhance its international presence by sharing experiences and exploring cooperation at the 2024 International Funeral Association Conference[14]. - The company plans to transform from a funeral service provider to a provider of funeral and life technology services, focusing on high-quality life services and memorial services[88]. - The company aims to expand its market share by integrating resources in the highly fragmented Chinese funeral industry and actively seeking development opportunities[87]. - The company is committed to advancing its standardization efforts and maintaining compliance with regulatory frameworks to support sustainable growth[25]. Social Responsibility and Community Engagement - The company actively participated in social welfare activities, earning the title of "2023 Annual Chinese Public Welfare Enterprise" for its charitable efforts[13]. - The group made charitable donations of approximately RMB 1.75 million for the fiscal year ending December 31, 2024[147]. - The company is committed to achieving carbon neutrality and promoting green funerals, utilizing eco-friendly materials and constructing century-old ecological cemeteries[179]. Governance and Management - The board of directors consists of three executive directors, three non-executive directors, and four independent non-executive directors, complying with listing rules regarding board composition[185]. - The board has the discretion to determine eligible participants for the Restricted Share Incentive Plan and the number of shares to be granted[158]. - The company has established a remuneration committee to formulate remuneration policies, with directors' remuneration subject to shareholder approval at the annual general meeting[155]. - The company has adopted a corporate governance code to enhance transparency and accountability, aiming for high standards in corporate governance[181]. Innovation and Technology - The company introduced the first domestic virtual and interactive digital ancestral hall, "Yuan Family Hall," integrating various digital memorial functions[12]. - The introduction of new industry standards emphasizes the integration of technology in funeral services, including the development of an IoT-based information system for funeral management[26]. - The company aims to leverage technological innovation to enhance the dignity and quality of funeral services, aligning with modern consumer expectations[26]. - The company is focused on transforming from a funeral service provider to a life and memorial technology service provider, enhancing the quality of life services offered[119]. Employee and Operational Insights - The company has 2,198 full-time employees as of December 31, 2024, down from 2,471 in 2023, indicating a focus on optimizing workforce efficiency[126]. - Employee costs decreased by RMB 19.6 million or 3.9%, primarily due to a decline in sales services and one-time costs related to personnel optimization[55]. - The company emphasizes the importance of customer satisfaction and conducts monthly surveys to gather feedback and improve service quality[127]. Financial Health and Cash Flow - Cash generated from operating activities was RMB 731.6 million, a decrease of RMB 490.9 million or 40.2% year-on-year, primarily due to reduced revenue and increased tax payments on dividends[68]. - The debt-to-equity ratio as of December 31, 2024, was 0.5%, significantly lower than 3.5% the previous year, indicating strong cash generation capabilities[75]. - The company had no outstanding bank loans as of December 31, 2024, and maintained a comprehensive credit facility of approximately RMB 10 billion[73][74].

Summary of Conference Call Records Company and Industry Overview - The conference call discusses a company in the life sciences and memorial services industry, focusing on its strategic transformation and digitalization efforts to enhance service offerings and operational efficiency [3][5][8]. Key Points and Arguments 1. **Financial Performance**: - The company achieved a revenue of approximately RMB 20 billion in the fiscal year, maintaining a low cost burden of only 0.5% [1]. - Total return on investment has approached 14%, reinforcing the company's position as a preferred long-term investment [2]. - The operating income from various segments reached RMB 4.97 billion and RMB 3.73 billion, with operating margins of 30.2% and 23.9% respectively, showcasing strong profitability [2]. 2. **Strategic Transformation**: - The company aims to become a leading provider of life sciences and memorial services in China, emphasizing the importance of digital transformation to standardize consumer value through technology [3]. - The integration of AI and data analytics is enhancing customer demand forecasting and operational efficiency [3]. 3. **Market Trends**: - The aging population in China is driving demand for memorial services, with the elderly population expected to reach 400 million by 2030 [7]. - Despite cautious consumer spending, there remains a strong potential for growth in the industry, particularly in high-quality and personalized services [6][7]. 4. **Government Policies**: - Recent government initiatives aim to optimize the business environment and stimulate market vitality, which is expected to boost consumer confidence and economic stability [5][6]. - The government is also focusing on enhancing service industry standards, which presents opportunities for the company to improve its service offerings [6]. 5. **Digitalization and Innovation**: - The company is leveraging digital tools to enhance customer experiences, including AI-driven memorial services and online platforms for service delivery [3][44]. - A significant increase in the sales of digital products was noted, with a 204% rise in specific service offerings compared to the previous year [44]. 6. **Challenges and Responses**: - The company faces challenges from a cautious consumer environment and increased competition, leading to adjustments in sales strategies and service offerings [42][43]. - The management is focused on maintaining high service standards while adapting to changing consumer preferences and economic conditions [42][43]. Other Important but Overlooked Content - The company is actively working on enhancing its supply chain management to ensure sustainable development and operational efficiency [18]. - There is a strong emphasis on community engagement and educational initiatives to promote life sciences and memorial services, which is seen as vital for long-term growth [9][16]. - The company is committed to maintaining a balance between profitability and social responsibility, ensuring that its services meet the evolving needs of society [39][48]. This summary encapsulates the key insights from the conference call, highlighting the company's strategic direction, financial performance, market dynamics, and the impact of government policies on its operations.

Core Viewpoint - The leading company in the funeral industry, Fushouyuan, is experiencing a significant decline in performance, with a reported revenue of 2.078 billion RMB in 2024, down 20.9% year-on-year, and a net profit of 373 million RMB, down 52.8% year-on-year [2][5]. Revenue Breakdown - Fushouyuan's revenue is primarily derived from three segments: cemetery services, funeral services, and others, all of which are experiencing a downward trend in 2024. Specifically, cemetery service revenue decreased by 22.2%, funeral service revenue decreased by 14.8%, and the average sales price for funeral services dropped by 269 RMB or 4.9% [4][6]. Market Conditions - The decline in performance is attributed to a high base from the previous year, overall market conditions, and cautious consumer behavior. The average profit margin for cemetery services has also decreased from 60.2% in 2023 to 41.3% in 2024 [5][6]. Industry Characteristics - The funeral industry is generally considered a market necessity with high margins and low price sensitivity. However, the approval for new cemeteries has been restricted, raising the entry barriers for new competitors [6][7]. Business Model Challenges - Fushouyuan's business model relies on long-term land leasing, but the current downturn in the real estate market has negatively impacted sales. The average price of graves has dropped from a peak of 121,500 RMB to 117,300 RMB, with a significant reduction in sales volume [8][11]. Acquisition Strategy - Fushouyuan has engaged in numerous acquisitions, totaling 2.06 billion RMB from 2014 to 2022, but the returns from these acquisitions have not met expectations, leading to a decline in profitability [8][9]. Digital Transformation Efforts - To counteract declining sales, Fushouyuan is pursuing a digital transformation strategy, including the introduction of AI technology and new digital services. However, the market response has been lukewarm, and the cost of innovation has not yielded significant revenue [10][12]. Future Outlook - The company anticipates a 15% increase in service volume in 2025, but expects the average price of graves to decrease by approximately 25%, potentially down to around 90,000 RMB [11]. Analysts suggest that without a shift towards mid-range offerings and asset-light restructuring, Fushouyuan's challenges will likely intensify [12].

Core Viewpoint - The funeral industry is undergoing a green transformation under the national "dual carbon" strategy, with Liaoning Guanyin Mountain Fushou Garden initiating carbon neutrality certification, potentially becoming the first carbon-neutral ecological cemetery in Northeast China [1][2]. Group 1: Carbon Emission Management - Liaoning Guanyin Mountain Fushou Garden reported a total greenhouse gas emission of 561 tons CO2 equivalent for 2023, covering direct emissions, energy indirect emissions, and transportation indirect emissions [2]. - The emission data has been verified to meet the ISO14064-1:2018 international standard, achieving a "reasonable assurance level" with no substantial deviations, reflecting the company's commitment to transparent carbon emission management [2]. Group 2: Ecological and Cultural Integration - The garden adopts a "park-like cemetery" concept, restoring vegetation on barren mountains, achieving over 85% greenery in the park, and integrating ecological and cultural landscapes [5]. - It features various memorial sites and cultural attractions, combining natural scenery with humanistic memorials, thus creating both ecological benefits and cultural value [5]. Group 3: Sustainable Construction Practices - The park utilizes new types of paving materials instead of traditional stone, promotes biodegradable urns, and implements solar-powered lighting systems to reduce resource consumption and environmental pollution [6]. - These initiatives aim to harmonize cemetery construction with environmental protection [6]. Group 4: Innovative Operations and Services - Over the past decade, the garden has promoted over 1,000 eco-friendly burial methods, such as green burials and flower burials, significantly reducing land use and carbon emissions [8]. - The park enforces a "no burning, no fireworks" policy, advocating for low-carbon memorial practices, preserving emotional connections while protecting the environment [8]. - Digital technologies are introduced to provide low-carbon services, enhancing the memorial experience while supporting sustainability goals [8][14]. Group 5: Industry Implications - The carbon neutrality practices of Liaoning Guanyin Mountain Fushou Garden offer a replicable low-carbon pathway for the traditional funeral industry [15]. - The management emphasizes the integration of ecological, artistic, and intelligent elements to create a "zero-carbon cemetery" model, reflecting a growing societal responsibility towards future generations [15].

Core Viewpoint - The company, Fushouyuan, is transitioning from a funeral service provider to a provider of funeral and life technology services, demonstrating resilience despite short-term economic fluctuations and aiming to become a cultural innovation benchmark in the global funeral industry, thereby creating sustained excess returns for shareholders [1] Group 1: High Dividend Returns and Cash Flow Management - Fushouyuan declared a final dividend of HKD 0.0954 per share for 2024, with total dividends reaching HKD 1.269 billion, representing 311% of the company's attributable profit, significantly higher than the average in the Hong Kong stock market [2] - The company generated net cash from operating activities of HKD 731.6 million in 2024, with total cash and bank balances amounting to HKD 2.0566 billion, showcasing a robust financial strategy with a negative net debt ratio [3] Group 2: Business Structure and Market Opportunities - The dual cash flow model of Fushouyuan's cemetery business, combining one-time sales with long-term services, provides a stable income stream, supporting its high dividend policy [4] - The aging population, increasing cremation rates, and tight supply of burial plots create a strong growth environment for the company, with the elderly population in China projected to exceed 400 million by 2035 [5][6][7] Group 3: Innovative Service Models - Fushouyuan's pre-contract service model is expected to drive growth over the next 20 years, with a 14.2% year-on-year increase in signed pre-contracts in 2024 [8] - The company has introduced the "3JI" concept, integrating cultural elements into its services, and has successfully implemented this model in 17 parks, enhancing customer experience through technology [9] Group 4: ESG Leadership and Corporate Governance - Fushouyuan has established a robust governance structure and has been recognized for its sustainable development efforts, achieving an A+ rating in the Hang Seng Index for three consecutive years [10] - The company actively engages in corporate social responsibility, with initiatives in various fields, including the notable "Shanghai Grandma" digital memorial project, enhancing its brand value [13] Group 5: Long-term Value Creation - Fushouyuan is focused on cultural empowerment within the industry, achieving significant milestones in talent development and standard output [11][12] - The company aims to redefine its value proposition by integrating technology and culture, with potential market capitalization growth from HKD 10 billion to HKD 40 billion, driven by innovative services [17][18]