Greentown Management Warns of Significant Profit Decline for FY2025

Key Highlights

• Profit Warning: Greentown Management Holdings Company Limited has issued a profit warning indicating that its net profit attributable to shareholders for the year ended 31 December 2025 is expected to decrease by approximately 40% to 50% compared to the prior year.
• Comparison with Previous Year: The expected decrease is in relation to the net profit of approximately RMB801 million recorded for FY2024.
• Reasons for Decline:
  • Intensified competition in the project management industry
  • Decline in revenue from the project management business
  • High and inflexible personnel costs leading to reduced gross profit
• Industry Context: The real estate sector in China remained in an adjustment cycle in 2025, leading to increased market fragmentation and competition, making profitability more challenging across the sector.
• Market Position: Despite the profit pressure, Greentown maintained a market share of over 20% for ten consecutive years and continued to be an industry leader in several operational metrics.

Operational Details and Achievements

• New Contracted Projects: Total Gross Floor Area (GFA) of newly contracted projects under project management reached 35.35 million square meters in 2025, with estimated project management fees of approximately RMB9.35 billion.
• Repeat Mandates: The rate of repeat mandates for projects increased for three consecutive years, reaching 26%.
• Project Delivery: The company delivered approximately 14.51 million square meters of high-quality projects in 2025, maintaining over 10 million square meters of delivery for five years in a row.
• Client and Buyer Satisfaction: Both client and homebuyer satisfaction remained at industry-leading levels.
• Financial Health: Operating cash flow showed continued improvement, and the company describes its financial condition as healthy and robust, providing a strong foundation for future sustainable development.
• Shareholder Returns: In 2025, the company repurchased and cancelled a total of 10,000,000 ordinary shares and declared its first interim dividend of RMB0.076 per share.

Key Information for Shareholders

• Price-Sensitive Information: The expected 40-50% decline in net profit is highly material and price sensitive. Investors should carefully consider this development when making investment decisions, as it could significantly impact the company’s share price.
• Unaudited Figures: The figures provided are based on unaudited management accounts for FY2025, and the actual audited results (to be announced by the end of March 2026) may differ.
• Continued Resilience: Despite the profit warning, the company emphasizes its industry leadership, high market share, and ongoing improvements in operational and financial metrics.

Leadership and Governance

The announcement was made under the authority of the Board, comprising both executive and non-executive directors, as well as independent non-executive directors, reflecting the company’s ongoing commitment to governance and transparency.

Conclusion

Greentown Management’s profit warning for FY2025 signals significant challenges in the Chinese project management and real estate sectors, with intensified competition and revenue declines impacting profitability. However, the company continues to deliver strong operational metrics and maintain industry leadership, supported by healthy cash flow and proactive shareholder returns.

Disclaimer

This article is based on publicly available information and the company’s unaudited management accounts. Investors are advised to exercise caution and await the audited annual results, as actual performance may differ from preliminary estimates. The information provided does not constitute investment advice.

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