Editor's Introduction: The growth rate of net profit attributable to the mother achieved the first decline in nearly six years, which made New Town Holdings fall into the dilemma of no increase in revenue and decline in a number of profitability indicators such as net profit margin and gross profit margin.
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Recently, many housing enterprises have chosen to postpone the release of annual reports, resulting in entering the "difficult production period" of housing enterprises' annual reports.
However, New Town Holdings was not affected by this and recently disclosed its 2021 annual report.
However, the annual report of New Town Holdings is somewhat unsatisfactory, the data shows that last year, the contract sales amount of New Town Holdings was 233.75 billion yuan, down 6.85% year-on-year, and the sales target achievement rate was 89.91%; the operating income was 168.2 billion yuan, an increase of 15.64% year-on-year, and the growth rate hit a new low in nearly six years.
Not only that, its attributable net profit growth rate has also achieved the first decline in nearly six years, which has plunged New Town Holdings into the predicament of no increase in revenue and the decline of profitability indicators such as net profit margin and gross profit margin.
At the same time, the "green file" New Town Holdings has a shortage of funds in 2021, and its cash is difficult to cover short-term bonds and accounts payable, other payables, so it seems that the new town holdings that safely survived the cold winter of the industry in 2021 are not under pressure in 2022.
Gross margin declined And revenue increased without profit
Recently, New Town Holdings released its 2021 annual report.
According to the annual report, in 2021, New Town Holdings achieved contract sales of 233.775 billion yuan, down 6.85% year-on-year; achieved sales area of 23.5473 million square meters, an increase of 0.25% year-on-year.
Based on the sales target of 260 billion yuan set in 2021, the sales target achievement rate of New Town Holdings is only 89.91%, which is the first year since 2013 that the target has not been achieved.
Affected by this, in 2021, New Town Holdings achieved operating income of 168.232 billion yuan, an increase of 15.64% year-on-year, becoming the lowest growth rate of operating income in the past six years.
At the same time, New Town Holdings has also fallen into the situation of increasing revenue without increasing profits, and the data shows that in 2021, New Town Holdings achieved a net profit of 13.76 billion yuan, down 16.43% year-on-year; achieved a net profit attributable to the mother of 12.598 billion yuan, a year-on-year decrease of 17.42%, the first decline in nearly 6 years.
In this regard, many institutions believe that the decline in gross profit margin is one of the main reasons for their increase in revenue and no increase in profit. The data shows that in 2021, the gross profit margin of New Town Holdings was 20.45%, a year-on-year decrease of 3.05 percentage points, although the commercial income of New Town Holdings increased in 2021, but according to the annual report, more than 90% of the current revenue of New Town Holdings still comes from real estate development, and in 2021, its gross profit margin of real estate development decreased sharply from 21.74% in the same period of 2020 by 4.06 percentage points to 17.68%.
Zheshang Securities believes that the decline in the gross profit margin of New Town Holdings is mainly due to the impact of the historically high price carry-over superimposed price limit policy.
That is to say, the land that New Town Holdings previously took for the expansion of high prices pulled down its gross profit margin when it was carried forward in 2021.
In addition, it is estimated that the average sales price of New Town Holdings in 2021 will be 0.9928 million yuan / square meter, down 7.08% year-on-year, and the decline in the average sales price will also affect the gross profit margin of New Town Holdings, which will become one of the reasons for the performance to increase revenue and not increase profits.
Difficulties in dematerialization Substantial provision for asset impairment
According to the research report of Zheshang Securities, another reason for the increase in revenue of New Town Holdings is that it has made a large provision for asset impairment.
According to the announcement, in 2021, New Town Holdings made a provision for impairment of various assets of 5.404 billion yuan, of which 554 million yuan was provided for bad debts, 4.851 billion yuan was provided for inventory decline, and the impact of the asset impairment provision on the net profit attributable to the mother in 2021 was 3.440 billion yuan.
The so-called provision for inventory decline is that the net realizable value of inventory is lower than the original cost, and the reduction is a prudent treatment. That is to say, for various reasons, the current value of inventory is lower than the original cost, and the part below the original cost will be included in the inventory price decline reserve.
According to Dagong Real Estate reports, Bai Wenxi believes that when enterprises have inventory declines, it generally means that their projects have a risk of price decline in some cities, and it also indicates that enterprises may have difficulties in dematerialization.
According to the annual report, as of the end of 2021, the soil reserves of the first and second tier cities of New Town Holdings account for about 37% of the total soil reserves, and the third and fourth tier cities in the Yangtze River Delta region account for about 30% of the total soil reserves, and in the distribution of its sales of 233.775 billion yuan in 2021, the sales proportion of first- and second-tier cities reached 44%, and the proportion of third- and fourth-tier cities in the Yangtze River Delta region was lower than that of first- and second-tier cities, at 37%.
According to the previous research report of Kerry data, the overall deindustrialization cycle in 2021 has accelerated since the second half of the year, and the deindustrialization cycle of core first- and second-tier cities has decreased steadily, while the backlog of third- and fourth-tier inventory is more obvious, and the deindustrialization cycle has reached 19.34 months, significantly higher than the average of 100 cities, and the risk of dematerialization has surfaced.
In summary, the layout of New Town Holdings runs counter to this status quo, and its third- and fourth-tier cities in the second largest heavy position area have caused sales pressure on New Town Holdings.
In order to decentralize, at the performance briefing meeting, Wang Xiaosong said, "The company began to give certain discount promotions to customers with a high down payment ratio for projects or down payment ratios under pressure from October...", and said that "from January 2022, the company will comprehensively consider the dematerialization rate and profit margin, and begin to gradually recover the discount." ”
The so-called "fish and bear paws can not have both", according to Kerry data, the deindustrialization cycle of third- and fourth-tier cities in 2022 is still rising, that is to say, in the case of the gradual recovery of discounts, New Town Holdings will still face sales pressure.
Short-term debt repayment pressure is great
In fact, while facing sales pressure, New Town Holdings is also facing pressure to repay debts.
The data shows that in 2021, the current liabilities of New Town Holdings will be 364 billion yuan, a year-on-year decrease of 3.61%.
Among them, short-term borrowings were 558.9 million yuan, an increase of 24.28% year-on-year; bills payable were 6.682 billion yuan, a decrease of 1.53% year-on-year; non-current liabilities due within one year were 29.35 billion yuan, an increase of 44.69% year-on-year, and the three accumulated 36.591 billion yuan.
According to the financial report, as of December 31, 2021, the monetary funds of New Town Holdings were 55.226 billion yuan, and after excluding the restricted funds of 9.018 billion yuan, its cash and cash equivalents were 46.208 billion yuan, which can still fully cover the above debts.
As of the end of 2021, the asset-liability ratio after excluding pre-received accounts is 69.95%, the net debt ratio is 48.12%, the cash short-term debt ratio is 1.07, and all the company's indicators have reached the requirements of the green file.
However, it is worth mentioning that as of December 31, 2021, New Town Holdings had 52.35 billion yuan of accounts payable and 47.62 billion yuan of other payables, which although not included in short-term borrowings, if they cannot be repaid when due, it will also affect New Town Holdings, which shows that New Town Holdings has greater pressure on short-term debt.
As of the end of 2021, the minority shareholders' equity of New Town Holdings was 37.81 billion yuan, accounting for 38.93% of the total equity, but it only received 8.44% of the net profit of 13.76 billion yuan in 2021.
The rights and interests held are far from the profits obtained, so New Town Holdings is suspected of "clear shares and real debts".
At the performance meeting, Wang Xiaosong said that "living safely is the first priority", and the premise of survival is that New Town Holdings will face pressure from many aspects.
Original author: Wang Tingyan
Editor: Wang Tingyan