BEKE(BEKE)2024-03-15 16:45Financial Data and Key Metrics - Full year 2023 revenue reached RMB77.8 billion, up 28% year-over-year, with over 20% attributable to new initiatives [7] - GTV on the platform was RMB3.14 trillion, up 20% year-over-year, with existing home transactions growing by 29% and new home transactions rising by 7% [7] - Adjusted net margin increased by 7.9 percentage points to 12.6%, with adjusted net income of RMB9.8 billion [25] - Q4 2023 revenue increased by 20.6% year-over-year to RMB28.2 billion, with GAAP net income rising by 80.2% to RMB670 million [26] Business Line Performance - Existing home transaction services revenue grew by 15.9% year-over-year, with GTV reaching RMB468.1 billion in Q4, up 30.1% [28] - New home transaction services revenue grew by 6.7% year-over-year, with GTV reaching RMB238 billion in Q4, down 9.7% year-over-year but up 23.9% sequentially [29] - Home renovation and furnishing services revenue grew by 74.3% year-over-year to RMB10.9 billion, with contracted sales up 93% year-over-year [24][44] - Beike Rental Services managed over 210,000 units, up from 70,000 in 2022, with Carefree Rental model managing over 200,000 units [11][66] Market Performance - Existing home market GTV increased significantly, driven by lower base effects and increased activity in second and third-tier cities [27] - New home market remained sluggish, with CRIC data showing a 32% year-over-year decline in sales from top 100 developers in Q4 [29] - Homebuyers showed a preference for existing homes, with existing home GTV nationwide rising by 20-30% year-over-year [55] Strategic Direction and Industry Competition - The company is focusing on a technology-driven one-stop residential services platform, with a strategy of "One Body, Three Wings" to foster synergies [6][19] - Emphasis on quality and efficiency, with plans to enhance customer trust and drive future growth in home renovation and furnishing services [19][46] - Expansion of store and agent networks, with 42,000 active stores and 397,000 active agents by the end of 2023 [8][49] Management Commentary on Operating Environment and Future Outlook - The company aims for growth with stability in 2024, focusing on quality and efficiency while maintaining a strong balance between growth and risk control [13] - The real estate market is undergoing deep adjustments, with a shift towards existing homes and a focus on home upgrades [55][57] - The company plans to enhance digitalization and technology-driven initiatives to improve long-term efficiency [20] Other Important Information - The company repurchased approximately US0.351 per ADS [37][38] - Total shareholder return for 2023 significantly exceeded net income, accounting for around 159% of net income [38] Q&A Session Summary Question: Drivers behind the strong growth in home renovation and furnishing business [43] - The growth was driven by high-efficiency synergies between core and emerging businesses, a diversified product portfolio, and higher delivery capabilities [45] - In 2024, the focus will be on quality, with measures to shorten construction timelines and establish quality control roles [46] Question: Penetration rate in the existing home market and expansion plans [47] - The company achieved significant improvement in scale, efficiency, and profitability in the existing home market, with a 29% year-over-year increase in GTV [48] - Plans for 2024 include expanding the store network, improving agent expertise, and fostering collaboration with store owners [49][53] Question: Outlook on the real estate market and differentiation between new and existing home markets [54] - The existing home market is expected to remain stable, while the new home market will continue to fluctuate as it bottoms out [63][64] - Demand for home upgrades is dominant, making up 60% of total housing demand [56] Question: Accomplishments and risks in the home rental business [65] - The company expanded its Carefree Rental model to over 200,000 units and improved operational efficiency and service quality [66] - For 2024, the focus will be on achieving operational breakeven in core cities and enhancing service quality [68] Question: Strategy and outlook for the new home business [71] - The company outperformed the industry with a 7% growth in new home GTV, driven by proactive strategies and innovative services [72][73] - Plans for 2024 include promoting strategic collaborations with developers and enhancing infrastructure for new home sales [76]