On August 31st, Shimao Service (873.HK) released its 2023 interim results report. During the period, Shimao Service realized operating income of 4.098 billion yuan, gross profit of 863 million yuan and net profit of 155 million yuan, an increase of 11% over the same period last year. The core return net profit margin is 7.7%, and all profit indicators have rebounded sharply. In terms of scale, the contract area increased to 346 million square meters, accounting for 77.6% of the total area from a third party, an all-time high.
Of this total, the income from property management services was 2.613 billion yuan, an increase of 11.5% over the same period last year. The income of non-owner value-added services is 121 million yuan, the proportion of income has dropped to 3.0%, and the correlation with real estate continues to decrease. The income from community value-added services was 709 million yuan, of which the proportion of income from pension services continued to increase to 71.94 million yuan, a substantial increase of 45.3% over the same period last year. The income of urban service business is 655 million yuan, and the gross profit margin is about 1 percentage point higher than that of 2022.
In the first half of the year, the net cash flow of the company became positive, reaching 351 million yuan, and the net-to-present ratio rose sharply to 1.72, a record high; the company's management expense rate, sales expense rate and financial expense rate decreased significantly by 8 percentage points compared with the end of 2022. In the first half of 2023, Shimao Service not only has a better overall income structure, but also has a significantly improved profit quality.