Since August, real estate companies have been releasing their semi-annual reports for 2024 one after another. Under the new industry cycle, Xincheng Holdings (601155.SH), with its consistent "residential + commercial" dual-wheel drive strategy advantage, has strengthened its safe operation bottom line, ensured the quality and quantity of property delivery and commercial opening targets, continuously released commercial potential, and sought new development in the new track of agency construction, injecting a continuous stream of momentum into the company's development.

On the evening of August 30, Xincheng Holdings released its semi-annual report for 2024. During the reporting period, the company focused on "stable operation" and "bottom-line thinking," continuously raising the safety level of corporate operations.

In terms of stable performance, in the first half of the year, Xincheng Holdings achieved a total operating income of 33.904 billion yuan, a net profit attributable to the shareholders of the listed company of 1.318 billion yuan, a non-IFRS net profit attributable to the mother company of 1.318 billion yuan, and a gross margin of 21.6%, an increase of 2.57 percentage points year-on-year. Based on the stable core indicators, as of the end of the reporting period, Xincheng Holdings' undelivered area (including joint ventures) reached 19.1644 million square meters, providing ample room for imagination for future performance.

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In terms of cash flow, which affects the capital flow and operational efficiency of real estate companies, Xincheng Holdings also performed steadily. In the first half of the year, Xincheng Holdings achieved a contract sales amount of about 23.554 billion yuan, a contract sales area of about 3.2622 million square meters; it achieved a cash recovery amount of 24.7 billion yuan, with a cash recovery rate of 105%, providing a stable guarantee for the company's cash flow security.

In terms of reducing debt, Xincheng Holdings continued to reduce interest-bearing debt and continuously consolidated a stable and safe financial foundation. As of the end of June 2024, the company's financing balance was 55.8 billion yuan, a reduction of 1.3 billion yuan from the beginning of the year, and the debt structure was further optimized; the company's joint venture equity interest-bearing debt was reduced to 3.952 billion yuan, a decrease of 1.256 billion yuan from the beginning of the year.

Xincheng Holdings actively repays its debts to ensure that every debt is repaid in advance or on time. In the first half of 2024, the company has repaid 1.97 billion yuan of domestic and foreign public market bonds as scheduled.

The debt is within the safety line, and the cash flow is more relaxed, leaving a safe space for the company's development. As of the end of the reporting period, Xincheng Holdings had a cash balance of 15.782 billion yuan, with ample cash on hand; the net debt ratio was 47.00%, which continued to remain at a low level; the net cash flow from operating activities was 2.088 billion yuan, and the net cash flow from operating activities has been positive for six consecutive years. The healthy "internal blood-making" ability ensures that the company can still maintain a good cash flow situation in the complex and changing market environment, providing a solid foundation for the company's continuous development.

In addition, Xincheng Holdings actively fulfills its corporate social responsibility and takes the delivery of properties as the top priority in operation management. Data shows that in the first half of 2024, the company has organized the delivery of more than 57,000 properties. In the second half of the year, the company will also continue to promote the delivery work to ensure the high-quality completion of the annual delivery tasks.

Behind the continued improvement in performance is the further advantage of Xincheng Holdings' dual-wheel drive strategy. Commercial real estate, as the second growth curve for the company's development, has been continuously increasing its contribution to the overall performance of Xincheng Holdings and has brought long-term and stable cash flow.

Data shows that in the first half of this year, Xincheng Holdings achieved a total commercial operation income of 6.212 billion yuan, a year-on-year increase of about 19.44%, which has reached half of the annual target; it achieved a non-tax property rental and management income of 5.804 billion yuan, accounting for 17% of the company's total operating income; the property rental and management business gross profit was 4.191 billion yuan, accounting for the company's total gross profit from 43% last year to 57% this year; the property rental and management gross margin reached 72%.Additionally, relying on the "balanced emphasis on both light and heavy assets" business model, the commercial management scale of Seazen Holdings has further expanded. In the first half of this year, Seazen Holdings added six newly opened Wuyue Plazas, continuously creating new commercial landmarks for cities and bringing a happy life experience to consumers. As of the end of the reporting period, the company has achieved a layout of 201 complex projects in 137 major and medium-sized cities, with a total commercial area of Wuyue Plazas reaching 15.279 million square meters and a rental rate of 97.24%.

With the commercial real estate entering the era of stock, Seazen Holdings continues to promote the implementation of the "deep operation" strategy. Its Wuyue Plazas fully leverage their scale and platform effects, strengthen the construction of a win-win consumption field of "shopping malls - merchants - users," and continuously promote the increase of mall sales and customer flow.

Both scale and quality have increased, and Seazen Holdings has also steadily entered the commercial harvest period: since 2021, the commercial sustainable operating income has significantly exceeded the interest expense of the current period, and in the first half of 2024, this ratio further increased to 2.71 times.

Thanks to a healthy financial condition and an excellent credit system, Seazen Holdings has always maintained smooth and diversified financing channels.

In May of this year, Seazen Holdings successfully issued the first medium-term note of the year, with full guarantee from China Bond Insurance Corporation, with an issuance scale of 1.36 billion yuan, a total subscription multiple of more than 2.7 times, a 3-year term note interest rate of 3.2%, and a 5-year term note interest rate of 3.4%, maintaining a low financing cost. This is also the company's policy support from the private enterprise bond financing support tool after successfully issuing four full guarantees from China Bond Insurance Corporation in 2024.

In addition, relying on the high-quality asset fundamentals of Wuyue Plaza itself and the growing operational strength, the commercial sector continues to bring incremental financing cash flow to Seazen Holdings. From January to August this year, Seazen Holdings added 12 billion yuan in financing obtained by mortgaging Wuyue Plaza.

In addition to good performance and financial performance, to give full play to the synergistic effect and resource advantages, Seazen Holdings established a real estate agency construction and management business platform "Xincheng Construction Management", continuously expanding the development track. With the strategic layout and resource accumulation of the parent company, Xincheng Construction Management has basically achieved a national layout. Data shows that as of the end of June 2024, Xincheng Construction Management has managed more than 90 projects, with a total construction area of more than 13 million square meters, and more than 50 commercial complex projects under management. In the first half of the year, the newly signed area exceeded 3.52 million square meters, ranking 6th in the "Newly Signed Agency Construction Scale Ranking" and 9th in the "Agency Construction Sales Scale Ranking" of the China Real Estate Agency Construction Enterprise in the first half of 2024 by the China Index Research Institute, with a steady increase in business scale.