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Abstract: In order to meet the higher requirements, the outsourcing cost and property operation expenses of special services have been further increased.
On April 21, the leading property enterprise special service in the track of the high-tech industrial park handed over the report card of the past year.
Since its listing in 2020, the company has achieved revenue and profit growth for four consecutive years. In 2023, the revenue recorded was 2.447 billion yuan, a year-on-year increase of 22.04%, and the net profit attributable to shareholders of the listed company was 120 million yuan, a year-on-year increase of 5.30%, and the growth rate increased slightly compared with the previous year.
At the same time, Wuliao has learned that the gross profit margin of integrated property management services, which is its core business, has declined for four consecutive years. Although the trend of "involution" in the industry is squeezing the profitability of enterprises, for the special services of many large customers such as Huawei and Alibaba, the market wants to see more efforts by the management to improve profitability.
According to the company's dividend plan, the special service intends to distribute a cash dividend of RMB 2.2 (tax included) to all shareholders for every 10 shares.
During the period, while continuing to take park properties as the business strategy and develop in tandem with commercial, residential and public properties, laying the foundation for high-quality development, the company continued to actively seek entry and breakthroughs in new fields and new business formats, successfully entered the field of hydropower properties through equity investment, and continued to follow up market opportunities in the fields of government public construction and hospital logistics, seeking to expand and extend the market territory.
Gross profit margin fell for four consecutive years
In 2023, the company achieved operating income of RMB2.448 billion, an increase of 22.04% over the same period of last year, total profit of RMB17,200, an increase of 6.46% over the same period of last year, and net profit attributable to the parent company of RMB120 million, an increase of 5.30% over the same period of last year, all of which increased over the previous year.
There were 68 new expansion projects and new contracts of about RMB515 million, which were lower than the 82 new expansion projects and the newly signed contracts of RMB967 million in 2022, respectively.
In terms of product lines, the revenue of comprehensive property management services was 1.998 billion yuan, accounting for 81.64% of the total revenue, which was the core business of special services, while the revenue of government services, value-added services and other businesses were 253 million yuan, 192 million yuan and 0.04 billion yuan respectively, accounting for 10.34%, 7.85% and 0.17% respectively. All product lines recorded year-on-year growth, with growth rates of 21.11%, 9.34%, 57.83% and 67.74% respectively.
Data source: enterprise annual report, compiled by Wuliao Society
While revenue and net profit increased, the profitability of the special service failed to improve, and the overall gross profit margin recorded in 2023 was 12.19%, a decrease of 1.5 percentage points from 2022, accounting for only about half of the average gross profit margin of 23.49% in 2023.
In 2023, the gross profit margin of this product line decreased by 2.96 percentage points year-on-year to 8.31%, down more than 9 percentage points from 17.99% in 2020, while the gross profit margin of government services increased by 0.37 percentage points year-on-year to 15%, rebounding for three consecutive years.
Data source: enterprise annual report, compiled by Wuliao Society
During the Reporting Period, the operating cost of special services was approximately RMB2.149 billion, representing a year-on-year increase of approximately 24%. Specifically, the labor cost, business outsourcing cost and property operation expenses of comprehensive property management services increased by 9.65%, 24.72% and 140.02% year-on-year respectively, accounting for 82.68% of the total. The business outsourcing cost and property operation expenses of government services decreased by 48.12% and 11.28% respectively year-on-year.
It is understood that the park property management services in the comprehensive property management services of the special service are mainly for high-tech industrial parks, commercial office buildings, etc., and the services provided include facilities and equipment management, safety and fire management, environmental services, comprehensive customer service, space management, small property projects, etc., and representative projects include Huawei global headquarters property service projects, Alibaba global headquarters property service projects, etc.
With the development of their own business and the improvement of their industry status, these large enterprise customers have become more stringent in the control and assessment of property and other suppliers, and their requirements for service quality have been continuously improved. In order to meet the higher requirements, the outsourcing cost and property operation expenses of special services have been further increased.
In addition, the business of special services is mainly concentrated in South China, Central China and East China, which have developed economies, and the local wage level and price level are higher than those in other regions, and in recent years, they have continued to rise, and labor costs have also risen.
M&A entered the energy track
At present, property enterprises are seeking high-quality development, further shifting from emphasizing scale to emphasizing quality, and continuously enhancing their core competitiveness is the main strategic goal.
We have been working diligently on IFM integrated property management services in the park for many years, deepening the research on customer needs, operation scenarios and service standards, and has established long-term cooperative relations with enterprise customers such as Huawei, Alibaba, Tencent, Ant Financial, and China Mobile.
The management said that the integrated property management services in the park it is engaged in have certain entry thresholds, and there are also professional requirements for the comprehensive quality and professional ability of employees. With the rich experience accumulated over the years of deep cultivation of park properties, it has a high reputation in the market segment, can quickly respond to the needs of park customers and give targeted service solutions, and has a first-mover advantage in the competition of park property services.
At the same time, the background of state-owned enterprises in special services makes it easier for them to be recognized and trusted by government agencies when participating in government projects, thereby increasing the opportunities and success rate of project cooperation.
In recent years, the company has undertaken government services in Wuhan, Enshi, Huangshi, Jingmen, Shenzhen, Shantou, Dongying, Tianjin, etc., and has gradually formed a perfect business model in terms of project specialization and service standardization.
During the reporting period, in order to further promote the national market expansion of government services, Tefa Service also established a joint venture with Shanghai Shengtong Information Technology Co., Ltd. and Chongqing Yuanzhi Shengjing Digital Technology Partnership (Limited Partnership) to establish Tefa Shengtong Technology Co., Ltd., aiming to deeply explore the application of digital government services and build a smart government service platform, so as to enhance the technical competitiveness of the company's government services.
In addition, Tefa Service adheres to the strategy of "deepening the main business and diversifying the development in parallel", and after expanding the hospital format through marketization in 2022, it will complete the capital increase and share expansion project of Sichuan Dajinyuan Tianding Property Management Co., Ltd. (now "Tefa Energy Service") in 2023, which is also the first independent investment and M&A project since its listing, marking the official entry of Tefa Service into the energy property management track.
It is reported that the main customer of Tefa Energy Service, Guoneng Dadu River Basin Hydropower Development Co., Ltd., is responsible for the development and utilization of hydropower resources in the Dadu River Basin of Sichuan.
There are technical barriers to the property management of hydropower stations, small market competition, strong local protection, and regional restrictions, etc., even if the contract period signed by Tefa Energy Service is short, the possibility of continuous renewal is still large, which shows that Tefa Energy Service still has a large room for performance growth.
Guoneng Dadu River Hydropower Co., Ltd. is also committed to deeply integrating advanced digital technologies such as big data and artificial intelligence with power plant operation and management, and plans to build a non-hierarchical smart power plant in the future, which is highly synergistic with the current strategic goal of technological upgrading of special services.
In 2023, by focusing on core business and needs, Tefa Service will complete the construction of the smart property application (phase I) project and apply it in multiple property projects, continuously deepen and improve the middle and back office information systems such as human resources and financial management to improve management efficiency, continue to promote intelligent applications in project management scenarios such as equipment and facility operation and maintenance, environmental cleaning, and use Internet of Things technology, intelligent cleaning robots and mechanized equipment to effectively replace part of the manual work, and improve service quality and efficiency.