Yuexiu Services: More Stable Chassis, New Roads Opened | Annual Report Highlights ⑧

“Future markets will gradually consolidate around leading companies, and companies with the capabilities and development vision will achieve better growth.”

On March 26, Yuexiu Services (06626.HK) released its 2025 performance. For the full year, total revenue was approximately RMB 3.9B, up 0.9%; gross profit was approximately RMB 577 million, with a gross profit margin of approximately 14.8%; and net profit attributable to shareholders was approximately RMB 274 million.

Looking back over the past year, the property management industry has still been undergoing a painful transformation. Upstream real estate has continued to clear out inventory, costs have risen rigidly, waves of companies withdrawing from the sector have surged, and collection rates have fallen… property management firms have generally struggled with the dilemma of “increasing revenue without increasing profits,” or even “a double decline in revenue.”

Against this backdrop, Yuexiu Services has also “subtracted” from profits. However, beneath the surface fluctuations in profit lies its “addition” in core service quality, a “gear shift” in the structure of value-added businesses, a “leap” in the quality of non-residential tracks, and “building a wall” with digital intelligence and smart capabilities.

“Although the company’s performance showed short-term fluctuations last year, the company’s business foundation and financial fundamentals remain solid,” management said at the results presentation. During the industry’s transition period, opportunities and challenges coexist. Yuexiu Services will chart a path toward sustainable, high-quality development driven by internal growth.

Strengthen the foundation

“In 2025, Yuexiu Services’ residential customer satisfaction was 85.6%, improving year over year, and the collection rate reached 91%.”

As of December 31, 2025, Yuexiu Services had an area under management of approximately 73.47M square meters, up 6.0%; and a contracted area of approximately 90.01M square meters, up 1.4%.

The industry has moved on from the crude expansion phase of “race to grab market share,” entering a new stage of stock-based competition with quality as the top priority. Compared with growing by scale, quality and structure are more worth attention.

Last year, Yuexiu Services proactively exited 6.55 million square meters of low-quality and low-efficiency projects, strengthening its foundation through project-structure optimization. At the same time, 92% of its projects within the area under management were located in first- and second-tier cities, and its property fee unit prices were generally at the mid-to-high level in the industry, providing strong geographic and locational support for its “quality at a premium” strategy.

While optimizing scale, Yuexiu Services was also willing to invest heavily to enhance quality. During the reporting period, together with Yuexiu Real Estate, it carried out special “Yuehuanxin” campaigns across 83 communities nationwide. With cumulative investment of tens of millions of yuan, it completed 228 quality improvement projects, covering owner high-frequency touchpoints such as community gates, landscaped gardens, children’s recreational facilities, and elevator cabs.

Service quality ultimately shows up in cash flow. In 2025, Yuexiu Services’ collection rate for current-period fees from small property owners reached 91%, and the collection rate for current-period fees from externally expanded projects was as high as 94%, both far above the industry average. Benefiting from this, during the reporting period Yuexiu Services recorded a net inflow of operating cash flow of RMB 509 million.

In a period of industry contraction, Yuexiu Services strengthened its foundation. In 2025, revenue from basic property management reached RMB 1.5B, up 21.3%; accounting for 38% of total revenue, up 6 percentage points year over year—becoming the most stable growth engine for Yuexiu Services.

On the other hand, the value-added business segment underwent clear structural adjustments in 2025: the phase-out and settlement of high gross margin, hard-fi xed home improvement business were completed in succession, while non-owner value-added services related to affiliated real estate continued to contract. Yuexiu Services proactively made a strategic “gear shift.”

In 2025, Yuexiu Services established a value-added business department. Through resource integration and innovation in business models, it drove value-added services to transition from a “transaction-oriented” model that relied on highly related real-estate-linked business to an “operations-oriented” model focused on deepening into community stock-based demand.

Specifically, on the life services side, it implemented a “best-seller matrix + deep channel cultivation” strategy. It focused on high-frequency essential scenarios such as customized bottled water, grains and oils, air-conditioner cleaning, and Mid-Autumn Festival mooncakes, improving the coverage rate of community front warehouses.

On the integrated commercial side, “Yue + LIFE” lifestyle-integrated storefronts were deployed and operated. Using a “property leasing and sales + coffee + home furnishings” model, it built one-stop lifestyle service scenarios. The first externally expanded project in culture, commerce, and tourism—Wuxi Longtingli—achieved a leasing and tenant introduction rate of 82%.

In terms of property asset management, it focused on community high-frequency essential demand such as “cars, the elderly, small units, and pets,” cultivating a long-tail value-added ecosystem.

Management stated: “At the stock level, there is still significant room for value-added growth. The company will deeply understand owners’ needs and promote the transformation of value-added businesses from a transaction-oriented model to an operations-oriented direction.”

Break the grid, find a new path

If basic services and value-added businesses are Yuexiu Services’ “stock optimization,” then breaking through in non-residential tracks and its independently developed digital intelligence and smart capabilities—are Yuexiu Services’ “incremental layout” for the future.

In 2025, Yuexiu Services established a non-residential business division, focusing on three major tracks: commercial and office properties, large-scale public buildings, and large transportation hubs. During the reporting period, it新增 contracted area of 9.80 million square meters, newly signed 69 projects, and the annual contract value from city expansion and new signings was approximately RMB 300 million, of which the non-residential business accounted for as much as 87%.

A series of high-gold-standard benchmark projects were rolled out: Harbor and Navigation Building, Nanjing Crossing the River Victory Memorial, Jingyang Lake Innovation & Technology Park, Tianjin West Railway Station…

Among them, Jingyang Lake Innovation & Technology Park is especially worth attention. This is Yuexiu Services’ first comprehensive operational management project combining “industry + commerce + property.” The contract value was nearly RMB 370k, marking a substantive step in its move from single property management to a comprehensive urban operator.

As of December 31, 2025, the area under management for Yuexiu Services’ non-residential formats accounted for 37%. At the performance meeting, management clearly stated that it would position non-residential formats as the core development direction during the “15th Five-Year Plan” period, and emphasized selecting the best tracks among those with “strong creditworthiness, strong payment capability, and high strategic alignment.” It will also establish strict project exit mechanisms—“to ensure that every project entering achieves full profitability and a high collection rate.”

The “carefully selected” external expansion strategy reflects Yuexiu Services’ improvement in the quality standards of projects it pursues. Management said that over the next three years, Yuexiu Services will deeply cultivate the Greater Bay Area, the Yangtze River Delta, the high-tier cities in the central and western regions, and key cities such as Beijing-Tianjin-Hebei—12 core cities in total. Through regional deep cultivation and the overlay of comprehensive capabilities, it will build a moat for the non-residential business.

In the digital intelligence field, Yuexiu Services chose a more difficult path that also offers a stronger moat: independent R&D.

In 2025, Yuexiu Services advanced its digital intelligence transformation with an “integrated soft-and-hard-services” approach. Its key achievements are concentrated in three major directions: the integrated command center, the AI quality inspection system, and the EBA smart equipment management.

Specifically, the integrated command center builds a “platform + terminals” efficient operations system. The management cockpit achieves visualization and penetration of three-tier data—group, region, and project levels. With 80% of indicator systems generated directly, it significantly reduces supervisory costs.

The AI quality inspection system includes self-developed management software, self-developed data-collection hardware, and self-developed algorithm models. Compared with external procurement, it saves about RMB 3 million in development costs. It currently covers 209 projects and is applied to eight major scenarios, including when personnel are off duty and when e-bike vehicles park illegally. The AI intelligent monitoring has been performed over 84.14 million times, and warnings have been issued over 370k times.

The EBA-FM system manages all facilities and equipment based on AIoT, implementing a closed-loop process that automatically captures core equipment data, conducts real-time monitoring, sends alerts at the second level, and automatically dispatches work orders—reducing reliance on manual inspections.

Related company: Yuexiu Services hk06626