Core Viewpoint - The company is experiencing a significant decline in contract sales and profitability, with a focus on maintaining financial safety and reducing debt levels amidst a challenging real estate market [2][5][22]. Sales Performance - Contract sales decreased by 32% to 35 billion, with a total sales area of 2.61 million square meters, down 28% year-on-year [6][8]. - The average sales price was 13,393 per square meter, a decline of 4% compared to the same period last year [6]. - The company expects to release approximately 125 billion in inventory in the second half of the year, with 90% located in first and second-tier cities [2][6]. Land Acquisition and Financial Strategy - The company acquired four plots of land in Guizhou, Chongqing, Shanghai, and Suzhou, with a total land reserve of 24.9 million square meters, a decrease of 57% year-on-year [10][12]. - Financial safety is prioritized over new investments, with a focus on debt security and project completion [10][12]. - The total land reserve is 28.4 million square meters, with a significant portion located in first and second-tier cities [12][13]. Operational Performance - The operating business achieved a gross profit margin of 77.7%, with rental income of 7.01 billion, a year-on-year increase of 2.5% [3][16]. - The service business generated 6.26 billion in revenue, with a gross profit margin of approximately 30% [3][16]. - The company plans to open about 10 shopping malls in the second half of the year and aims for over 10% growth in the commercial sector for 2025 [17][19]. Profitability and Financial Health - The net profit margin decreased to 6.72%, with a net profit of 3.9 billion, down 43% year-on-year [19][22]. - The development business reported a gross profit margin of only 0.2%, leading to a loss of 1.18 billion in this segment [19][22]. - The company aims to reduce interest-bearing debt by over 30 billion in 2025, with a target to stabilize at around 100 billion [4][26]. Debt Management - As of mid-2025, the company held cash reserves of 44.7 billion, with a net debt ratio of 51.2% [4][25]. - The average financing cost decreased to 3.58%, and the average loan term extended to nearly 11 years [4][25]. - The company has a plan to manage its debt effectively, with a focus on maintaining a green status under the "three red lines" policy [28].

Core Viewpoint - Longfor Group has maintained growth and profitability amidst a deep adjustment in the real estate industry, achieving a revenue of 58.75 billion yuan in the first half of 2025, representing a year-on-year increase of 25.4% [1] Group 1: Financial Performance - Among 135 real estate companies that disclosed semi-annual performance data, only 53 reported revenue growth, with Longfor being one of the three companies with revenue exceeding 50 billion yuan that experienced growth [1] - The operating business, including commercial investment and asset management, achieved a gross profit margin of 77.7%, an increase of 2.3 percentage points year-on-year, demonstrating resilience [1][4] - Longfor's real estate development business generated revenue of 45.48 billion yuan, a year-on-year increase of 34.7%, with a delivery satisfaction rate of 90% for nearly 40,000 quality housing units [2] Group 2: Sales and Market Position - Longfor achieved a contract sales amount of 35.01 billion yuan, with a sales area of 2.614 million square meters, ranking in the first tier of the CRIC list [2] - The company has shifted focus from sales scale to quality of development, with 90% of sales coming from first- and second-tier cities and a collection rate exceeding 100% [2] - Longfor's land reserve totals 28.4 million square meters, with an average cost of 4,207 yuan per square meter, ensuring future development [2] Group 3: Operational Efficiency - The operating business and service business maintained steady growth, with operating business revenue reaching 13.27 billion yuan, accounting for 22.6% of total revenue [3] - Longfor operates 89 commercial properties, with a high occupancy rate of 97% and a sales growth of approximately 17% [3] - The smart construction business achieved sales of 8.4 billion yuan, with a delivery area of 1.22 million square meters [4] Group 4: Debt Management - Longfor has actively reduced its debt, with interest-bearing debt decreasing by 6.5 billion yuan in the first half of the year, and the average financing cost dropping to a historical low of 3.58% [6] - As of June 30, the net debt ratio was 51.2%, with a cash-to-short-term debt ratio of 1.14 times, maintaining a "green file" status [6] - The company plans to reduce interest-bearing debt by over 30 billion yuan by 2025, stabilizing total interest-bearing debt around 100 billion yuan [6][7] Group 5: Strategic Outlook - The company remains optimistic about the resilience of the Chinese real estate market, particularly in core locations of first- and second-tier cities [3] - Longfor's strategy of "low leverage + strong operations" has demonstrated strong cyclical resilience, positioning the company well for future growth [7]