At the 2025 annual results briefing held on the afternoon of April 20, management from China State Construction Engineering Corporation Limited (SH601668) highlighted strategic priorities. The briefing was attended by company leaders including Chairman Zheng Xuexuan, Vice President and CFO Huang Jie, Independent Director Liu Ruchen, Board Secretary Liu Lixin, and General Manager of the Investment Department Huang Gang.
Huang Gang addressed key questions regarding the company's real estate operations. Responding to inquiries about land acquisitions, he stated that projects acquired over the past two years have generally met established profitability targets, aligning with the group's requirements for stable investment returns.
Financial reports indicate that in 2025, the company reported operating revenue of 2,082.142 billion yuan, a decrease of 4.8% year-on-year. Net profit attributable to shareholders was 39.069 billion yuan, down 15.4% annually. The real estate segment recorded contract sales of 394.8 billion yuan, a 6.4% decline, while the contracted sales area increased by 3.3% to 150.9 million square meters. Revenue from real estate operations fell 7.2% to 284.4 billion yuan, with gross profit dropping 22.5% to 41.03 billion yuan.
According to the annual report, the company acquired 88 new land parcels during the reporting period, with a total land reserve of 69.61 million square meters by year-end. New land additions amounted to 9.28 million square meters, involving a total expenditure of 189.2 billion yuan. New construction starts for real estate projects decreased by 7.2% to 9.75 million square meters, while completed area saw a slight decline of 0.6% to 16.22 million square meters. The area under construction stood at 50.36 million square meters, down 11.1% year-on-year.
All newly added land reserves are located in first-tier, second-tier, and provincial capital cities. Specifically, within the company's portfolio, subsidiary China Overseas Land & Investment acquired 35 new parcels, adding 4.99 million square meters of land reserve with an investment of 118.7 billion yuan. China Construction Land Development secured 53 new parcels, increasing its land bank by 4.29 million square meters at a cost of 70.5 billion yuan.
The company currently holds over 15 million square meters of investment properties, including office buildings, hotels, apartments, and commercial real estate, with a net book value of 156.7 billion yuan.
Huang Gang emphasized the company's focus on ensuring successful project execution for every investment made. This involves optimizing regional布局 by actively securing prime land plots in core areas to strengthen market share in key cities. Furthermore, the company is enhancing its investment base development by leveraging subsidiaries and regional headquarters to establish strategic strongholds. Efforts are being intensified to explore non-public land acquisition channels, focusing on urban renewal, landscape enhancement projects, and equity acquisitions. Active participation in the investment of government-backed回购 housing projects is also prioritized to build a competitive edge in diversified land sourcing.
Huang Gang elaborated that the satisfactory profit margins from recent land acquisitions are attributed to several factors: the relatively favorable inherent qualities of the newly acquired land, with a focus on regions characterized by strong population influx and sufficient purchasing power among high-net-worth clients, providing solid price support for sales and effectively securing project profitability; the continuous enhancement of product competitiveness under the "Good Housing" standard, which involves comprehensive implementation and iterative upgrades to improve product quality and living experience; and effective internal coordination and empowerment for stringent cost control.
The company's 2025 annual report noted the ongoing progress of new urbanization initiatives in China, with relevant policies activating the existing property market. National statistics indicated substantial activity in the affordable housing sector and urban renewal projects throughout the year.
Huang Gang stated that China's urban development has entered a new historical phase, transitioning from rapid urbanization growth to stable development, and shifting from scale expansion to a stage focused on enhancing the quality and efficiency of existing urban stock. These transitions signify that urban renewal and city operation will become decisive areas for the development of the company's investment division, presenting significant strategic opportunities.
He explained that this shift is driven by the gradual release of policy and market benefits, and it promotes the transformation and upgrading of business models. The approach involves redefining land acquisition strategies to secure prime existing land in core areas through urban renewal, equity purchases, and streetscape improvements. Leveraging the company's full industrial chain advantage in investment, construction, and operation enables it to assist local governments with city assessments, profitability planning, and seeking economically viable systematic solutions. This strategy also enhances risk resilience and profit stability.
Huang Gang concluded by underscoring the high importance the company places on urban renewal operations. For the investment division specifically, it is mandated to act as the lead resource integrator and driver within the "investment-construction-operation" chain, playing a crucial role in leveraging synergistic advantages across the entire business spectrum.
Comments