As the real estate industry enters a period of deep adjustment, the property management industry has bid farewell to its past era of rapid, expansive growth and fully entered a new stage characterized by competition for existing assets and refined operations.
As a property services enterprise backed by Yuexiu Property, YUEXIU SERVICES' performance report for 2025, released on March 26, is a true reflection of this industry cycle transition.
From the overall revenue perspective, YUEXIU SERVICES barely maintained its growth momentum in 2025, achieving a total revenue of approximately 3.902 billion yuan for the year, a slight increase of 0.9% year-on-year.
However, beneath the surface of stable overall revenue, its profitability has encountered substantial downward pressure.
Financial report data shows that YUEXIU SERVICES' net profit attributable to the parent company in 2025 was approximately 270 million yuan, a year-on-year decrease of 22.5%. At the same time, the gross profit margin, representing the company's Headline Earnings indicators, also experienced a significant decline, with the overall gross profit margin falling by 8.5 percentage points from 23.3% in 2024 to 14.8%.
This situation of increasing revenue without increasing profit profoundly reflects the profit-related challenges currently faced by property management companies.
Specifically, the primary reason for the significant decline in YUEXIU SERVICES' profit for the year is the retreat of high-margin businesses that are highly tied to the real estate development cycle.
Directly impacted by the deep adjustment in the real estate industry, the gross profit margin of YUEXIU SERVICES' non-owner value-added services (such as brokerage services) decreased by 12.2 percentage points, and the gross profit margin of community value-added services also declined by 9.7 percentage points as phased home renovation businesses were gradually settled.
Meanwhile, in terms of basic property management services, due to continuous increases in investment, coupled with the rigid growth in labor and outsourced personnel costs brought about by policy adjustments, the gross profit margin of YUEXIU SERVICES' basic property management services has been further squeezed, falling by 3.7 percentage points last year.
Under the combined effect of these factors, the gross profit margin of YUEXIU SERVICES' non-commercial property management and value-added services segment in 2025 dropped significantly from 21.9% in 2024 to 13.4%.
Furthermore, fluctuations in the macroeconomic environment have also affected the operation of commercial properties. In 2025, the occupancy rates of commercial projects generally declined. To stabilize customer flow and occupancy rates, YUEXIU SERVICES had to increase cost investments against the trend, which directly caused its gross profit margin for the commercial property management and operation services segment to decrease from 29.3% to 20.7%.
The pressure on profitability in the fundamentals inevitably transmitted to the secondary market.
Over the past year, accompanied by the downturn in developer sentiment, the valuations of the entire property management sector have undergone profound restructuring. Investors have raised more stringent scrutiny on the growth expectations and risk resistance capabilities of property companies, and YUEXIU SERVICES' stock price performance has consequently faced considerable volatility and downward pressure.
After issuing its 2025 Profit Forecast warning, YUEXIU SERVICES' stock price experienced a sharp drop. On February 16, the decline reached 18.18%. As of the close of trading on March 26, YUEXIU SERVICES' stock price was approximately HK$1.79 per share, with a total market capitalization of approximately HK$2.689 billion.
Li Huiting, Chief Financial Officer of YUEXIU SERVICES, believes that the current stock price does not reflect the actual value of YUEXIU SERVICES. In 2026, in terms of market value management, the company will focus on expanding non-residential businesses and adjusting the structure of value-added services, primarily by improving performance to fulfill commitments.
Although not directly answering whether buybacks would be used to boost the stock price in the future, YUEXIU SERVICES has not remained silent in the secondary market over the past year.
In 2025, YUEXIU SERVICES cumulatively repurchased 8.2595 million ordinary shares for a total consideration of approximately HK$24.6 million, with the highest repurchase price reaching HK$3.29 per share.
In addition to substantial buybacks, YUEXIU SERVICES also attempted to stabilize the confidence of long-term investors through generous dividends. In 2025, YUEXIU SERVICES increased its full-year payout ratio to 60%, with a dividend of 0.11 yuan per share.
During this period of industry uncertainty, such high-certainty cash returns undoubtedly served as a strong boost to the market.
YUEXIU SERVICES' ability to calmly distribute dividends and conduct buybacks in the secondary market stems from its healthy balance sheet and ample cash flow.
As of the end of last year, YUEXIU SERVICES held cash and cash equivalents and time deposits of approximately 4.906 billion yuan, with no bank borrowings on its books.
YUEXIU SERVICES maintained its usual caution in terms of scale.
In 2025, YUEXIU SERVICES' contracted area only increased slightly by 1.4% to 90 million square meters, and its managed area grew by 6% to 73.5 million square meters. Behind the slowdown in growth is YUEXIU SERVICES' active &#34;slimming down&#34; of its management portfolio, with the company exiting a total of 6.5 million square meters of low-quality, low-efficiency projects during the year.
It is worth mentioning that approximately 495 million yuan of the funds raised by YUEXIU SERVICES during its 2021 IPO for mergers and acquisitions remains unutilized.
In response, YUEXIU SERVICES' management stated that considering the changes in the industry over the past few years, YUEXIU SERVICES' prudent attitude towards mergers and acquisitions is particularly valuable. The company has been actively monitoring and pursuing market opportunities, but it focuses on targets that have high synergy with the company, high operating quality, high sustainability, standardized financials, and relatively reasonable valuations.
Standing at the watershed moment of deep reshuffling in the real estate and property management industries, YUEXIU SERVICES experienced the pain brought by the retreat of high-margin businesses in 2025, but at the same time, it demonstrated its rationality in financial control and decisiveness in strategic adjustments.
Short-term fluctuations in the secondary market may be unavoidable, but in the latter half of the industry where survival of the fittest is accelerating, whoever possesses healthier cash flow and can truly achieve transformation will have the power to redefine the market landscape.

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Undergoing a cautious transformation

- The real estate sector's adjustment has influenced the property management industry, as evidenced by Yuexiu Service's 2025 performance report showing minimal revenue growth of 0.9%, with net profit down 22.5%.  
- Factors contributing to this decline include a reduction in high-margin services tied to real estate cycles and increased costs from policy changes affecting labor and outsourcing.  
- Despite challenges, Yuexiu Service's strong cash flow and zero debt allow it to strategically manage its assets, including share buybacks and generous dividends, while focusing on sustainable growth opportunities.

Profitability enters a painful period; how will YUEXIU SERVICES navigate the cycle?