"Domestic Real Estate" GREENTOWN CHINA: Expects profits to remain under pressure this year, land acquisition and investment work may face the biggest challenge in recent years

Regarding the issue of profit pressure, GREENTOWN CHINA (03900.HK) management stated at the 2025 annual performance meeting that the push for long inventory destocking has led to a certain decline in the gross profit margin for the 2025 fiscal year. The company recognized an asset impairment of RMB 4.9 billion in 2025. Affected by similar factors, the company is expected to face certain pressure on profits this year.

Management admitted that the current real estate market is still in the bottoming phase, and the overall market size is still facing certain downward pressure. Compared to the same period in previous years, the current pace of land market supply has significantly slowed, and the total supply has decreased. At the same time, high-quality land is relatively scarce, mainly influenced by multiple factors such as the government's land supply pace, the destocking situation in the commodity housing market, and developers' funding for land acquisition. Currently, the differentiation between cities and sectors is particularly pronounced. Overall, this year's investment work can be said to be the most challenging year in recent years.

Regarding this year's investment strategy, management stated that they will continue to adhere to the principle of "doing one thing at a time," balancing cash flow and profit, and not pursuing a single-dimensional indicator unilaterally. Regarding the dividend policy, the overall principle remains stable, based on net profit scale. As for whether the dividend policy will be adjusted in the future, management stated that there are currently no relevant plans