--- title: "Longfor Group's annual net profit fell by 90%, no dividend will be distributed, and it is expected that this year's performance will hit bottom, with the overall domestic real estate market stabilizing after a decline" type: "News" locale: "en" url: "https://longbridge.com/en/news/280752568.md" description: "LONGFOR GROUP (960) reported a net profit of HKD 1.022 billion for the full year of 2022, a year-on-year decrease of 90.2%, and will not distribute a final dividend. Revenue was approximately HKD 97.309 billion, down 23.7% year-on-year. Chairman Chen Xuping stated that the domestic property industry has undergone a deep adjustment, and the market is expected to stabilize. LONGFOR is actively reducing its debt, striving to achieve an operating cash flow of HKD 10 billion, and expects profit growth in its operations and services business to exceed 10%" datetime: "2026-03-27T08:27:07.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/280752568.md) - [en](https://longbridge.com/en/news/280752568.md) - [zh-HK](https://longbridge.com/zh-HK/news/280752568.md) --- # Longfor Group's annual net profit fell by 90%, no dividend will be distributed, and it is expected that this year's performance will hit bottom, with the overall domestic real estate market stabilizing after a decline Longfor Group (960) reported a net profit of RMB 1.022 billion for the entire year, a year-on-year decrease of 90.2%, with basic earnings per share of 15 cents and no final dividend declared, while a final dividend of RMB 0.1 is expected to be distributed in 2024. During the period, revenue was approximately RMB 97.309 billion, a year-on-year decline of 23.7%. Among this, revenue from real estate development was RMB 70.54 billion, operational business revenue was RMB 14.19 billion, and service business revenue was RMB 12.58 billion; the combined revenue from operational and service businesses was RMB 26.77 billion, accounting for 27.5% of total operating revenue. ## Market Decline Expected to Narrow Significantly Chen Xuping, Chairman and CEO of Longfor, stated at the earnings conference that the domestic real estate industry has undergone five years of deep adjustment, with new housing starts down 70% from peak levels, new home transaction volumes down 50%, and second-hand home prices correcting nearly 40%. The extent of the adjustment is considerable, and with the continued strengthening of policies to stabilize the housing market, the latest data shows that transaction volumes of second-hand homes in hot cities have stabilized in the first quarter of this year, with some high-quality new housing projects experiencing strong sales. It is expected that the overall real estate market will significantly narrow its decline this year and achieve stabilization. ## Debt Reduction Aiming for RMB 10 Billion Operating Cash Flow This Year As of the end of 2025, Longfor's total consolidated borrowings amounted to RMB 152.81 billion, a decrease of RMB 23.51 billion from the end of the previous year; cash on hand was RMB 29.2 billion. Chen Xuping stated that Longfor has actively reduced its debt since the second half of 2022, with a cumulative reduction of approximately RMB 60 billion in interest-bearing debt over three and a half years, and supply chain financing has been cleared. The company has maintained positive operating cash flow for three consecutive years, and this year, its development business will continue to focus on inventory clearance and activating existing assets, supplemented by selective incremental investments. At the group level, growth will be driven by operating cash flow, aiming to achieve an operating cash flow of RMB 5 to 10 billion for the entire year, and continue to replace short-term financing with operational property loans. ## Domestic Debt to be Cleared This Year He also mentioned that the company's credit financing due this year is only RMB 6 billion, significantly reduced from RMB 22 billion last year, and all domestic debts will be fully repaid by the end of 2026, with only a small amount of overseas syndicate loans and dollar bonds to be orderly repaid between 2027 and 2029. The company will continue to prioritize debt safety as its primary development strategy. ## Expected Profit Growth in Operational and Service Businesses Exceeding 10% Chen Xuping emphasized that the company expects profit growth in its operational and service businesses to exceed 10% this year, reaching a scale of RMB 10 billion, and estimates that by 2028 at the latest, the company's operational and service revenue will surpass real estate development revenue, marking a complete transformation of the company's debt structure. ## Systematic Repair of Profit Model Initiated Last year, the core after-tax profit margin was negative 2.4%, and the core equity after-tax profit margin was negative 1.7%. Zhao Yi, Executive Director and CFO of Longfor, stated that the company experienced its first core equity loss last year, mainly due to the ongoing decline in volume and price in the real estate development market, which significantly pressured the gross profit margin of development business sales. This pressure is expected to be concentrated in the 2025 to 2026 settlement cycle. He further indicated that since Longfor has successfully passed the peak debt period in 2025, and with the systematic repair of the profit model initiated, the development business is gradually reducing losses while the operational and service businesses maintain robust double-digit growth. The company's performance is expected to bottom out between 2025 and 2026 Growth will resume starting in 2027. ## Strictly Adhere to Investment Scale and Discipline in Land Acquisition Regarding future land acquisition models, Zhang Xuzhong, Executive Director and General Manager of Real Estate Development at LONGFOR GROUP, stated that LONGFOR will always prioritize financial safety first, with a clear internal priority of "ensuring payment" over new investments. Last year, LONGFOR acquired 7 pieces of quality land in core cities such as Shanghai, Shenzhen, Chengdu, Suzhou, and Chongqing, with a total construction area of 380,000 square meters and a new value of approximately 8.2 billion yuan. By the end of 2025, the total land reserve will exceed 22 million square meters, with a value of over 200 billion yuan, of which the proportion of land reserves in first- and second-tier cities exceeds 70%. In the future, the company will continue to strictly adhere to investment scale and discipline. 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