HUAXI Securities·2025-04-30 12:36Investment Rating - The investment rating for the company is "Accumulate" [1] Core Views - The company's Q1 2025 report shows a revenue of 1.615 billion yuan, a year-on-year decline of 23.49% and a quarter-on-quarter decline of 5.86%. The net profit attributable to the parent company was -513 million yuan, a year-on-year decline of 38.20% but a quarter-on-quarter increase of 53.18% [2] - The company is experiencing a recovery in profit margins on a quarter-on-quarter basis, with the operating profit excluding fair value changes nearing breakeven at -46 million yuan [2] - The company is actively promoting national subsidies in its malls to improve occupancy rates, with a focus on digital empowerment and user operations [3] - The gross margin for Q1 2025 was 59.06%, a year-on-year decrease of 1.45 percentage points, while the net profit margin was -36.90%, a year-on-year decrease of 19.97 percentage points [4] - The company is implementing a "3+Star Ecosystem" strategy to enhance its high-end home appliance and home decoration business, aiming to activate the existing market [5] Summary by Sections Revenue Performance - The revenue continues to be under pressure due to economic fluctuations, increased discounts to retain tenants, and a decrease in the number of managed malls. The revenue from self-owned malls, leased malls, and joint ventures was 1.104 billion yuan, 106 million yuan, and 37 million yuan respectively, with year-on-year declines of 14.0%, 34.9%, and 17.7% [3] Profitability Analysis - The company’s Q1 2025 gross margin was 59.06%, with a net profit margin of -36.90%. The decline in net profit is attributed to revenue drop and relatively fixed costs, alongside a decrease in the fair value of investment properties [4] Strategic Initiatives - The company is focusing on high-end home appliances and home decoration, promoting successful mall cases in cities like Kunming and Shenyang, and developing a new recruitment model [5] - The company is also enhancing multi-business collaboration, successfully launching new automotive space initiatives and participating in industry events to increase visibility [5] Financial Forecast - The company expects revenues of 8.195 billion yuan, 8.503 billion yuan, and 8.783 billion yuan for 2025, 2026, and 2027 respectively, with EPS projected at 0.02 yuan, 0.09 yuan, and 0.16 yuan [7]