Net profit drops nearly 40%! Can Wanwu Cloud still sustain itself after "de-Vanke-ization"? | Financial Report Review

Ask AI · What concerns does the independent path of Vanke face under the risk of debt?

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For Wanyun, in addition to common industry pressures, the debt owed by the single largest related party, Vanke, has become the most uncontrollable risk point—once a stable business supplier, it has now turned into a source of financial risk transmission.

China Real Estate News reporter Xu Qian | Beijing report

As the adjustment wave in the real estate industry continues to sweep through upstream and downstream, property companies that once rapidly rose with the support of their parent companies are collectively facing growing pains.

On the evening of March 19, Wanyun, the leading property company under Vanke, delivered its performance report for 2025: operating income slightly increased by 2.7% year-on-year, reaching 37.27 billion yuan; however, net profit plummeted by 38%, only 772 million yuan.

Behind the sharp drop in profit is not only the helplessness of recognizing a 743 million yuan impairment for receivables from Vanke but also reflects the operational pressure faced by the property industry, which is generally experiencing difficulties in collecting property fees and high vacancy rates in newly delivered communities. More importantly, the long-pursued “de-Vanke” process by Wanyun has entered a deep-water zone.

In a letter to shareholders, Wanyun Chairman Zhu Baoquan candidly stated that selling houses is currently challenging, with over 30% of units in newly delivered communities unsold. Among the sold units, the vacancy rate for owners who have not moved in is also significant, further increasing the burden of payment. To reduce accounts receivable, the company has had to participate in arrangements where property developers settle debts with properties, but the assets used to settle debts often carry impairment risks.

“Ten years ago, we undertook a project developed by a leading real estate company in Shenzhen, and I was shocked that its subordinate property management could actually abandon projects developed by the related real estate company. In 2025, we also exited a project developed by a related company in Tianjin for the first time, breaking through the historical internal red line,” Zhu Baoquan said.

After the performance announcement, Wanyun’s stock price came under pressure. On March 20, it dropped by 5.79%, and on March 23, it fell another 5.98%, closing at 16.51 HKD per share. To stabilize market confidence, the company repurchased 270,000 shares on March 20, spending 4.7346 million HKD, signaling management’s recognition of the company’s long-term value and intention to support the stock.

From a service perspective, the property service industry has been plagued by various issues such as long-term regulatory loopholes, arbitrary charges, severely reduced services, mysterious public revenue distributions, illegal collections, and mandatory bundled services, which have become troubling matters for many people. Last year, the Central Commission for Discipline Inspection focused on various issues in the property service industry, triggering a nationwide grassroots anti-corruption campaign in the property sector.

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Profit Decline

Wanyun’s performance report for 2025 shows highly contrasting “split” characteristics: operating income maintained slight positive growth, with a net operating cash flow of 1.69 billion yuan, cash reserves of 12.09 billion yuan, and no interest-bearing loans, indicating a stable financial base; however, net profit dropped sharply, severely impacting profitability.

The core issue points to the receivables crisis and the drag from related businesses with Vanke. The financial report shows that Wanyun’s credit impairment losses significantly increased by 567 million yuan in 2025, with the vast majority coming from impairment provisions for receivables from Vanke and its related companies (an increase of 483 million yuan year-on-year). As of the end of 2025, Wanyun’s receivables from Vanke still reached 2.064 billion yuan, although this was a decrease from 2.446 billion yuan at the end of 2024, the proportion of which in overall receivables remains significant.

Against the backdrop of ongoing liquidity pressure in the real estate sector, Vanke itself faces slowing development business and pressure on capital recovery, which directly leads to payment difficulties from Wanyun’s related parties, with a large amount of funds being occupied, forcing them to digest risks through impairment provisions, thus eroding the company’s net profit.

This issue is not unique to Wanyun, but Wanyun is more significantly affected by its parent company. Data shows that in 2025, the average property fee collection rate of the top 500 property companies nationwide has dropped to 71%, with rising vacancy rates, declining willingness of owners to pay, and overdue debts from developers, collectively squeezing the profit margins of property companies.

Wanyun’s Chief Operating Officer He Shuhua stated that the company’s new projects have a vacancy rate of about 30%, including leftover units from developers and units not yet received by owners, making collection difficult and possibly requiring discounts; combined with the impact of housing prices on owners’ willingness to pay, the performance of the real estate industry is continuously transmitting pressure to the property side.

For Wanyun, aside from the common pressures in the industry, the debt owed by its single largest related party, Vanke, has become the most uncontrollable risk point—once a stable business supplier, it has now become a source of financial risk transmission, which is also the core catalyst for Wanyun’s determination to accelerate its “de-Vanke” process.

Deeper pressure comes from the contraction of related businesses and declining profitability. For many years, Vanke’s new home deliveries, site services, and property services provided Wanyun with a stable business foundation, which was a core advantage for its early rapid expansion. However, as Vanke’s development business slows down and new projects sharply decrease, coupled with Wanyun’s active reduction of high-risk related businesses, income from Vanke continues to shrink.

From the income structure perspective, in 2025, Wanyun’s cyclical business revenue (including residential, commercial, and urban comprehensive space property services and related technical solution services) reached 33.402 billion yuan, a year-on-year increase of 8.5%, accounting for 89.7% of the group’s total revenue; while income from related transactions was only 2.239 billion yuan, a year-on-year decrease of 1.197 billion yuan, with its share of total revenue dropping significantly from over 20% five years ago and 9.5% in 2024 to 6%.

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Can “de-Vanke” succeed?

“This is the result of active management by the company, which will indeed bring pressure in the short term—contraction of related party businesses will lead to a corresponding decrease in income and gross profit; but in the long run, this is an inevitable path to optimize income structure, improve operational quality, and enhance business independence,” Wanyun’s financial officer Wang Xubin explained during the earnings conference.

It is worth noting that excluding the impact of developer business and impairment losses, Wanyun’s core net profit in 2025 increased by 11.1% year-on-year.

Wanyun’s “de-Vanke” process is not a sudden move but a gradual reform that has taken years, transitioning from passive response to active planning. As early as the beginning of its listing, Wanyun established a market-oriented and independent development direction, and the ongoing downturn in the real estate industry has forced an acceleration of this process, from business diversification to a complete cut-off of related risks, each step is filled with growing pains.

In terms of business structure, Wanyun has completed the transformation from “relying on the parent company” to “market-driven.” By the end of 2025, the company’s non-developer business income reached 34.72 billion yuan, a year-on-year increase of 8.4%, accounting for nearly 94% of total operating income; the proportion of third-party independent developer projects in residential properties reached 62.7%, and in commercial services, the proportion of third-party projects exceeded 86%.

In terms of operational decision-making, Wanyun has completely broken the traditional model of “prioritizing Vanke projects,” instead using profitability and payment capability as core criteria for selecting businesses, even actively exiting high-risk related projects.

According to Wanyun’s management, in 2025, the company exited projects developed by Vanke-related enterprises for the first time, clearly defining operational red lines: projects without clear payment paths should be approached cautiously, projects with vacancy rates exceeding 20% should be approached cautiously, and existing businesses with payment cycles exceeding two months should be strictly controlled.

When related transactions contract, what fills the gap is the ability to expand in the existing market. In 2025, Wanyun acquired 247 residential projects in the existing market, with newly signed annual income of 1.422 billion yuan, a year-on-year increase of 21.1%. Among these, 51 projects were obtained through an “elastic pricing” model, maintaining a 70% bidding success rate in the existing market competition.

At the same time, technology empowerment and cost reduction for efficiency. In 2025, Wanyun launched over 1,400 AI agents and officially employed nine AI staff, optimizing human resources and compressing administrative expenses through digital means. The company’s annual administrative expenses decreased by 198 million yuan year-on-year, with the expense ratio declining by 0.7 percentage points. Additionally, it continued to promote the “Butterfly City” strategy, covering 690 street-level Butterfly Cities by the end of 2025, enhancing service efficiency and reducing operating costs per project through regional centralized operations and labor reuse.

Wanyun’s “de-Vanke” process is not an isolated case, but a common fate for property companies affiliated with real estate developers. From Country Garden Services, Greentown Services, to Poly Property and China Resources Vientiane Life, leading property companies are all advancing “de-parenting” to varying degrees, expanding into third-party markets.

Zhu Baoquan believes that the property industry has fully entered a “Warring States era,” with competition for quality targets becoming intense. In 2025, Wanyun participated in 280 bids, winning 196 times, with more than half of the unsuccessful bids lost to small local property companies or local state-owned enterprises. For Wanyun, after “de-Vanke,” it must confront this fierce competition. However, Zhu Baoquan believes that companies that can endure will achieve exponential growth in the future, as the market landscape shifts from hundreds of thousands of companies to tens of thousands. The future core competitiveness will no longer be the quantity of related projects, but rather the ability to expand in the market, provide refined services, and control costs.

Regarding the performance trend for 2026, Wanyun’s management also provided a clear judgment. Board Secretary Huang Min stated at the earnings conference that external environmental disturbances still exist, and the issue of vacant houses is unlikely to be completely resolved in the short term. There may be some fluctuations in mid-2026 performance, but the overall goal for the year is clear: to strive for overall stability.

However, homeowners, the “bread and butter” of property services, have a different view of the management’s statements. On March 13, the Housing and Urban-Rural Development and Transportation Bureau of Jiujiang District, Wuhu City, Anhui Province, recently issued a notice criticizing the Wuhu branch of Nanjing Vanke Property Management Co., Ltd. and making several punitive decisions.

On December 22, 2025, the Anhui Provincial Safety Production Supervision Group conducted a “double random” inspection of the Vanke City (North District) community in Jiujiang District and discovered numerous serious fire safety hazards on-site, including clutter in fire lanes and pipeline wells, undismantled dust covers for smoke detectors in pipeline wells, non-functional fire fans in the basement, malfunctioning fire shutter doors, and pressure gauges without pressure in the wet alarm valve room. These issues expose the property service company’s weak safety awareness, lack of主体 responsibility, failure to conduct routine inspections, and ineffective maintenance of facilities, posing a significant threat to the life and property safety of community residents with serious nature and adverse impacts.

On one hand, property companies chase profits endlessly; on the other hand, homeowners have long criticized the mismatch between service quality and pricing by property companies. Wanyun faces the same inquiry. After a drastic restructuring for survival, Wanyun’s true path to independent growth has just begun. In the commercial script, after the barbaric growth of capital, there often comes a phase of reckoning and rebirth. In previous years, property companies relied on the “three highs” period of real estate to go public crazily, and the growth curve did not always align with service quality and commercial credit.

This is an exam question for every property company, and Wanyun is no exception.

On-duty editor: Su Zhiyong

Editor: Ma Lin, Wen Hongmei