LONGFOR GROUP(HK:00960)2022-09-29 22:00Financial Performance - Longfor Group reported a total revenue of RMB 50.3 billion for the first half of 2022, representing a year-on-year decrease of 15%[7]. - The company achieved a net profit of RMB 8.1 billion, down 20% compared to the same period last year[7]. - The core attributable profit for the first half of 2022 was RMB 6.55 billion, representing a year-on-year increase of 6.1%[49]. - Revenue for the six months ended June 30, 2022, was RMB 94,804,581, an increase of 56.3% compared to RMB 60,615,215 for the same period in 2021[128]. - Gross profit for the same period was RMB 20,146,783, representing a gross margin of approximately 21.2%[129]. - Profit for the period was RMB 10,883,297, which is a 7.4% increase from RMB 10,129,298 in the previous year[129]. - The company reported a profit before taxation of RMB 15,927,325, up from RMB 13,871,046, indicating a growth of 14.8%[129]. - The total revenue for the six months ended June 30, 2022, was RMB 221,877,608, a decrease of 1.4% compared to the previous period[140]. - The company reported a net profit attributable to owners of RMB 124,949,245, reflecting a significant decline of 7,475,617 compared to the prior year[140]. Project Development and Sales - Longfor's total assets reached RMB 500 billion, with a debt-to-equity ratio of 70%[7]. - The company has 30 ongoing projects with a total gross floor area (GFA) of 3.5 million square meters under development[11]. - Longfor plans to launch 15 new projects in 2023, aiming for a sales target of RMB 100 billion[7]. - The company expects a recovery in the real estate market in the second half of 2022, projecting a 10% increase in sales compared to the first half[7]. - The total GFA under development across various projects amounts to 1,200,000 sqm, indicating significant growth potential[27]. - The company is actively expanding its market presence with multiple projects in cities like Shenyang and Quanzhou, indicating a strategic focus on regional growth[27]. - The company has several projects under planning, including a 171,182 sqm project in Wuhan, expected to complete by May 2025[48]. - The Group achieved contracted sales of RMB 85.81 billion from January to June 2022, with a total GFA of 5.185 million square meters sold[66]. - The total contracted sales for the Group in the first half of 2022 amounted to RMB 85.81 billion, a decrease from RMB 142.63 billion in the same period of 2021[69]. Market Expansion and Strategy - Longfor is expanding its market presence in second-tier cities, with plans to enter 5 new cities by the end of 2023[7]. - The company is investing RMB 1 billion in new technology for smart home solutions to enhance customer experience[7]. - Longfor Group is committed to enhancing its portfolio with new residential and commercial projects, reflecting a robust growth strategy[28]. - The overall strategy includes expanding into new markets and enhancing existing properties to drive future growth[38]. - The company aims to maintain a reasonable and safe debt level while pursuing stable and sustainable development amid fierce industry competition[91]. Financial Stability and Management - The cash to short-term debt ratio was over four times, and short-term debt due within one year accounted for about 10.1% of total debt outstanding[53]. - The average financing cost of the Group decreased to 3.99%, indicating strong financial management and support from shareholders[53]. - The Group's total borrowings amounted to RMB 212.38 billion, with cash in hand of RMB 87.55 billion, resulting in a net debt to equity ratio of 55.3%[89]. - The average cost of borrowing for the Group was 3.99% per annum, with an average loan maturity of 6.28 years[89]. - The company maintains a strategic focus on financial stability and efficient operations to navigate economic cycles[51]. Rental Income and Property Management - Revenue from commercial investment, rental housing, and space services reached RMB 11 billion, representing a year-on-year increase of 26%[55]. - Rental income from investment properties was RMB 5.9 billion, up 23% year on year[55]. - The Group's rental housing brand "Goyoo" has commenced operations in major cities including Beijing, Shanghai, and Shenzhen, contributing to its rental income growth[70]. - The overall rental income growth rate for the company's properties was 3.9% in the first half of 2022[73]. - The occupancy rate across properties averaged 96.3% in the first half of 2022, showing a slight decline from 97.0% in the first half of 2021[73]. Corporate Governance and Shareholder Structure - The Company has complied with the Corporate Governance Code during the six months ended June 30, 2022[112]. - As of June 30, 2022, Madam Wu Yajun holds approximately 42.609% of the company's ordinary shares, totaling 2,589,778,201 shares[94]. - HSBC International Trustee holds a total of 3,983,066,605 ordinary shares, representing 65.532% of the company's equity[101]. - The company has established a trust structure involving multiple layers of ownership, including HSBC International Trustee and other entities[102]. - The voting rights of shares held by Charm Talent are controlled by Madam Wu Yajun, as per the trust agreement[96]. Future Outlook - The company plans to continue focusing on market expansion and new product development as part of its future strategy[140]. - Future outlook remains positive with expectations of improved occupancy rates and rental income growth in the upcoming quarters[73]. - The company is actively exploring mergers and acquisitions to enhance its market position and operational capabilities[140].