Core views
In 2023, the company achieved revenue of 77.78 billion yuan, an increase of 28.2% over the previous year. The housing transaction business led to an increase in total transaction volume and a relatively rapid increase in revenue. In 2023, the company's total transaction volume was 3142.9 billion yuan, an increase of 20.4% over the previous year. In 2023, the company achieved adjusted non-GAAP net profit of 9.79 billion yuan, an increase of 243.3% year over year. The performance growth rate was significantly higher than the revenue growth rate, mainly due to the increase in profit margins contributed by 7.4 and 3.0 percentage points from the previous year in stock housing and new housing transactions, respectively, which led to a rise in comprehensive gross margin from 22.7% in 2022 to 27.9%. The number of stores and agents grew steadily in 2023, and the synergy with the second track business was further enhanced. The revenue of the home improvement and leasing business both increased significantly, accounting for a sharp increase in total revenue from 13.0% in 2022 to 24.7%. The company increased shareholder feedback and paid $600 million in 2023, with a dividend payout ratio of 44%.
occurrences
In 2023, the company achieved revenue of 77.78 billion yuan, up 28.2% year on year; realized net profit of 5.88 billion yuan, net loss due to mother of 1.39 billion yuan in 2022; achieved adjusted non-GAAP net profit of 9.79 billion yuan, an increase of 243.3% year on year.
Brief review
The increasing quality of stock and new housing transactions has led to a high increase in performance. In 2023, the company achieved revenue of 77.78 billion yuan, an increase of 28.2% over the previous year. 1. The second-hand housing transaction business led to an increase in total transaction volume, which contributed to a relatively rapid increase in revenue. In 2023, the company's total transaction volume was 3142.9 billion yuan, up 20.4% year on year, of which total second-hand housing transaction volume was 2028 billion yuan, up 28.6% year on year, and total new housing transaction volume was 103 billion yuan, up 6.7% year on year. In 2023, the company achieved net profit of 5.88 billion yuan, and net loss to mother of 1.39 billion yuan in 2022; achieved adjusted non-GAAP net profit of 9.79 billion yuan, an increase of 243.3% over the previous year. The main reason why the performance growth rate was significantly higher than the revenue growth rate was the sharp increase in the profit margin contributed by the housing transaction business. The contributing profit margins of the stock housing and new housing transactions reached 47.2% and 26.6% respectively in 2023, up 7.4 and 3.0 percentage points from the previous year, driving the comprehensive gross margin to 27.9% from 22.7% in 2022.
The number of stores and agents has been growing steadily, and the collaborative development of the second track business has had good results.
By the end of 2023, the number of the company's stores was nearly 44,000, up 8.1% from the end of the previous year; the number of agents was 428,000, up 8.5% from the end of the previous year. The scale of the housing transaction business grew steadily, and the synergy with the second track business was further strengthened. In 2023, the home improvement business achieved revenue of 10.85 billion yuan, an increase of 115.0% year on year, and the emerging business, including leasing, achieved revenue of 8.4 billion yuan, an increase of 194.8% year on year. The share of the second track business in total revenue increased sharply from 13.0% in 2022 to 24.7%.
Increase shareholder feedback. The company announced a dividend of US$400 million for the end of 2023, along with a special dividend of US$200 million paid in the third quarter of 2023. The total dividend in 2023 was US$600 million, accounting for 44% of the adjusted non-GAAP net profit of US$1.38 billion in 2023, further strengthening the return to shareholders.
The profit forecast was lowered and the buying rating was maintained. We forecast that the company's EPS for 2024-2026 will be 1.78/1.99/2.18 yuan (the original forecast for 2024-2025 will be 2.08/2.54 yuan), and the company's non-GAAP net profit for 2024-2026 will be 107.5/116.8/12.62 billion yuan, respectively. We are optimistic about the company's leading position in the field of stock housing and new housing transactions, the development potential of the second track business, and maintain the purchase rating.
Risk warning: 1) The repair of second-hand housing and new housing transactions may fall short of expectations. Subsequent new and second-hand housing market trends are still affected by the macroeconomic environment and residents' income expectations. If housing transactions fall short of expectations, it may cause the company's GTV and trading business revenue growth to fall short of expectations and put pressure on performance; 2) Emerging business development may fall short of expectations. The company joined Shengdu Home Furnishing in the second quarter of 2022, and plans to complete the acquisition of iSpace Home Furnishing in the first half of 2024. In the future, it will rely on the home improvement business to open up a second growth curve. However, there is a risk that the integration results will fall short of expectations, and iSpace Home Furnishing has a risk that the acquisition will fail; the home improvement business is not a completely standardized business, and there is also a risk that the results of replication in many places will fall short of expectations.