Guolian Minsheng Securities: Profits in the property management industry in the first half of 2025 have recovered, with stable returns and dividends highlighting the stability of dividends.

Guolian Minsheng Securities released a research report, stating that in the first half of 2025, the total net profit attributable to the parent of 59 sampled listed property companies was 10.06 billion yuan, an increase of 22.0% year-on-year. With improvements in expense ratio and reduced impairment effects, profit repair was significant. The total dividend amount was 4.4 billion yuan, an increase of 0.1% year-on-year, with strong dividend willingness among top property companies. The real estate industry of property companies is still in an adjustment phase, with a focus on operational efficiency and cash flow management shifting from scale expansion. It is recommended to invest in top property management companies with high dividend willingness, efficient operations, and solid fundamentals, such as CHINA RES MIXC (01209), ONEWO (02602), etc. Guolian Minsheng Securities' main points are as follows: Income statement: Revenue growth slows down, profit rebounds, and state-owned enterprises and high-quality private enterprises perform better In the first half of 2025, the 59 sampled listed property companies had a total revenue of 147.07 billion yuan, an increase of 4.1% year-on-year. The net profit attributable to the parent was 10.06 billion yuan, an increase of 22.0% year-on-year, with significant profit repair due to improved expense ratio and reduced impairment effects. CHINA RES MIXC, CG SERVICES, POLY PPT SER posted the top three profits. The gross profit margin was 19.4%, a decrease of 1.2% year-on-year, mainly due to low willingness of owners to pay fees and rising labor costs. The selling and management expense ratio was 7.4%, a decrease of 0.5% year-on-year, showing positive results in cost reduction and efficiency improvement for property companies. Balance sheet: Collection stability with sufficient cash flow, state-owned enterprises lead in financial resilience In the first half of 2025, the 59 sampled listed property companies had an accounts receivable turnover days of approximately 114 days, a decrease of about 3 days compared to the first half of 2024. State-owned enterprises performed the best (about 70 days), still significantly better than the industry average. The net cash total was 92.94 billion yuan, almost unchanged year-on-year. State-owned enterprises and high-quality private enterprises have significant cash flow advantages, providing a foundation for continuous dividends. ONEWO, POLY PPT SER, and CG SERVICES ranked top in net cash. Business structure: Focus on core business operations and high-quality expansion in external markets In the first half of 2025, the revenue of various businesses of 34 listed property companies: 1) Property management service income increased by 7.6% year-on-year, accounting for 72.7%, with a focus on core business and solid fundamentals, and steady growth in basic property management; 2) Community value-added services decreased by 2.3% year-on-year, as property companies contracted inefficient businesses to improve quality; 3) Non-owner value-added services decreased by 24.6% year-on-year, affected by the decline in new home sales, the income ratio may continue to decrease. In the first half of 2025, the managed area and contracted area of property companies increased year-on-year by 1.4% and 0.2% respectively, shifting focus from "scale expansion" to "fine management" and "profit quality improvement". Stable dividend payments and active buybacks, highlighting the value of leading property companies In the first half of 2025, the 59 listed property companies: 1) The total dividend amount was 4.4 billion yuan, an increase of 0.1% year-on-year, with strong dividend willingness among top property companies, with CHINA RES MIXC, ONEWO, CHINA OVS PPT ranking top in dividend amounts; 2) Buybacks steadily progressed, with companies like ONEWO, GREENTOWN SER, CG SERVICES continuing to repurchase shares to stabilize stock prices and enhance confidence; 3) Some top property companies have strong dividend willingness, with high dividend yields, showing good dividend asset characteristics and long-term investment value. Investment recommendation: Recommended investment in top property management companies with high dividend willingness, efficient operations, and solid fundamentals Guolian Minsheng Securities pointed out that the real estate industry of property companies is still in an adjustment phase, with a focus on operational efficiency and cash flow management shifting from scale expansion. Top property companies, with resource endowments, customer stickiness, and service capabilities, maintain strong resilience in basic property management and continuously improve comprehensive operational efficiency through exiting inefficient businesses and optimizing diversified business structures, presenting higher investment value in the current market environment. It is recommended to invest in top property management companies with high dividend willingness, efficient operations, and solid fundamentals, such as CHINA RES MIXC (01209), ONEWO (02602), etc. Risk Warning Policy effects falling short of expectations, lower-than-expected related party sales, and weaker-than-expected market expansion.