Small Moh: Country Garden Services (06098.HK) did not meet profit expectations in the first half of the year, but dividend guidance has been raised.

According to the Wisdom Financial APP, Xiao Mo released a research report stating that Country Garden Services (06098.HK) core net profit in the first half of 2025 decreased by 15% compared to the same period last year, which is 6% lower than the bank's forecast. Despite a 10% year-on-year increase in revenue, the gross profit margin contracted. The disappointing performance was mainly due to the unexpected increase in administrative expenses, which grew by 23% year-on-year. However, the surprising highlight is that the management has committed to a dividend payout ratio of 60% for the 2025 fiscal year, higher than the 33% in the 2024 fiscal year, implying a dividend yield of 6.5% to 7%. The rating is reduced to hold, with a target price of 5 Hong Kong dollars.