Meikailong 2025 Annual Report: Net operating cash flow of 818 million yuan, main business stabilizing after bottoming out

(Source: Yuan Media Exchange)

On March 30, Meikailong ( 601828.SH and 01528.HK ) released their 2025 annual reports. During the reporting period, the company achieved revenue of 6.58B yuan. Affected by the downward pressure in the real estate industry, Meikailong adhered to a prudent principle and made significant valuation adjustments to its investment properties’ fair value, resulting in a net profit attributable to shareholders of the listed company of a loss of 23.72B yuan for the year.

It is noteworthy that, after excluding non-operating factors, Meikailong’s main business is showing resilience and recovery potential. Under the leadership of the new five-year strategy and deep empowerment from Jianfa Corporation, the company’s operational quality has improved. The annual report shows that the net operating cash flow for the year reached 816 million yuan, a substantial increase of 277.34% compared to 216 million yuan in 2024; the gross profit margin of the core home furnishing business service segment increased by 2 percentage points to 61.9%.

Jianfa’s comprehensive empowerment stabilizes core business

From this annual report, it appears that Meikailong’s main business has initially stabilized. As of December 31, 2025, the average occupancy rates of 74 self-operated malls and 218 managed malls under the company have improved compared to 2024. Among them, the average occupancy rate of self-operated malls increased by 2 percentage points to 85.0%.

Meanwhile, Jianfa Group’s mature state-owned asset management experience has helped the company achieve comprehensive cost reduction and efficiency enhancement. In 2025, Meikailong’s operating costs, selling expenses, and management expenses decreased by 18.95%, 18.59%, and 24.22%, respectively, with all declines exceeding the decline in operating income, substantially improving operational efficiency. The financing advantages brought by Jianfa’s shareholder background are also gradually materializing, with the company’s overall financing cost rate reduced from 5.1% last year to 4.4%, leading to interest expenses dropping from 2.53B yuan to 2.16 billion yuan. By the end of 2025, the total scale of notes payable and accounts payable decreased by 43.79% compared to the previous year-end, with historical debt steadily cleared.

During the reporting period, business collaboration between the two parties accelerated. Meikailong deepened cooperation with Jianfa Light Industry and Jianfa Automotive, continuously advancing strategies such as the 3+Star ecosystem and the integration of people, vehicles, and homes. In 2025, Meikailong’s appliance store operation area reached 1.41M square meters, accounting for 10.1% of the total area; the automotive operation area doubled from 160k to 320k square meters, covering 46 cities nationwide.

Jianfa also brought new customer acquisition channels to Meikailong. On one hand, the company linked with international events like the Diamond League and Xiamen Marathon, elevating brand image; on the other hand, through Jianfa/Lianfa’s real estate ecosystem, Meikailong extended marketing reach to 76 projects in 20 cities, accumulating over 14k customer groups, directly driving about 150 million yuan in conversions, and building a “real estate + home furnishing” traffic loop.

Additionally, the first deeply collaborative commercial project, Chengdu Bay Yuecheng, opened on December 20, 2025. The project is positioned as a “Vibrant Family Gathering Place in the South of the City,” breaking traditional boundaries of home furnishing commerce, introducing diverse high-frequency consumption formats such as sports outdoor, parent-child entertainment, and specialty dining, achieving a renewal upgrade of existing assets and efficient release of commercial value.

Valuation adjustment of investment properties consolidates asset quality

Due to the deep adjustments in China’s real estate industry over the past few years, commercial real estate generally requires valuation adjustments. Based on cautious judgment of macro environment and industry trends, Meikailong conducted a comprehensive revaluation of its investment properties’ fair value according to accounting standards. This move resulted in a fair value change loss of approximately 160k yuan on the books, which is the core reason for the significant loss in 2025. However, on the other hand, this valuation adjustment solidified the company’s asset quality, making the book value more aligned with current market realities.

Industry insiders point out that such accounting treatment does not involve the company’s cash flow and does not indicate a substantive deterioration of the company’s main business. Through sufficient value adjustments, Meikailong eliminated potential hidden risks of future asset depreciation, laying a more solid financial foundation for the company’s subsequent strategic deployment.

While promoting asset valuation to reflect reasonable commercial value, Meikailong is also proactively acting at the operational level. Facing shrinking industry demand and difficulties faced by tenants, the company has implemented measures such as rent reductions to stabilize tenants and support their operations, safeguarding the stability of the home furnishing industry chain. Although this exerts some short-term pressure on revenue, it also consolidates the tenant base and lays a foundation for ongoing improvement.

New five-year strategy sets sail, aiming for high-quality development

Since 2025, under the top-level tone of “stabilizing the real estate market,” a series of policy benefits have been introduced in the real estate sector. In December 2025, the China Securities Regulatory Commission issued a notice on promoting high-quality development of the Real Estate Investment Trusts (REITs) market, including commercial real estate in pilot programs, helping expand diversified financing channels. Starting January 1, 2026, the existing housing provident fund loan interest rates were fully lowered, with first-home loan rates for five-year or longer terms reduced to 2.6%, and second-home loans to 3.075%, continuously easing residents’ home purchase pressure. In March 2026, Shanghai announced that the minimum down payment ratio for commercial property purchases would be lowered to no less than 30%, reducing barriers to commercial real estate investment and ownership. Meanwhile, nationwide policies promoting the exchange of old for new consumer goods, including subsidies for smart home products, continue to stimulate home furnishing consumption demand.

With ongoing policy support and market self-cleansing, the real estate industry is gradually emerging from the downward cycle, with stabilization becoming a consensus. Citic Securities’ research report indicates that, as supply contraction enters its sixth year, the deep adjustment of the real estate market is nearing its end. Ding Zuyu, Co-President of CRIC Group and Chairman of Pru Smart Technology, analyzed from six dimensions including dynamic supply and demand, inventory, and house price adjustments, and believes that the real estate market is confirming a bottom, signaling stabilization.

At this critical juncture of industry stabilization, Meikailong’s new five-year strategy is also launching smoothly. The company positions itself as “a new commercial operator for home life and a service provider for the home furnishing industry ecosystem,” anchoring high-quality development. On one hand, Meikailong will focus on upgrading its core home furnishing business, continuously enhancing content and operational capabilities, and deeply exploring the value of home furnishing commercial spaces to strengthen core competitiveness; on the other hand, the company will expand service boundaries, empowering upstream industry chains, including brand factories, to create a second growth curve.

Analysts believe that as investment properties return to current commercial value and operational fundamentals stabilize, in the context of a gradually warming real estate market and sustained release of home furnishing demand, Meikailong is expected to seize industry recovery opportunities, achieve continuous improvement in operational performance, and realize long-term value return.

Some images are sourced from the internet. If there are any infringements, please notify for removal.

Massive information, precise analysis, all on Sina Finance APP