Greentown China issues profit warning as profit drops by about 95%
On the evening of March 10th, Greentown China issued a profit warning announcement. Greentown officially expects that the profit attributable to shareholders for the whole year of 2025 will decline by about 95% compared with 1.596 billion yuan in 2024, hitting a new high in the decline of profitability in recent years.
This means that Greentown's profit last year was only about 80 million yuan.
Greentown's announcement also stated that although the company's profit has declined significantly, its debt structure has been continuously optimized. The proportion of short - term liabilities is less than 20%, hitting a record low. The cash reserve is abundant, and the cash - to - short - term debt ratio exceeds 2.5 times, hitting a record high. The overall operation is stable and efficient, and the finance is safe and sound.
According to the ranking of "Top 100 Real Estate Enterprises by Sales in China in 2025" released by the China Index Academy, Greentown China's sales volume in 2025 was 251.9 billion yuan and the sales area was 12.08 million square meters, both ranking second in the industry.
The significant decline in profitability is not unique to Greentown. Judging from the data of listed real estate enterprises that have released performance forecasts so far, leading real estate enterprises are all in a profit dilemma. Among the top 5 real estate enterprises by sales volume in 2025: Poly Developments and Holdings Group Co., Ltd., Greentown China, China Overseas Land & Investment Limited, China Resources Land Limited, and China Merchants Shekou Industrial Zone Holdings Co., Ltd., three have released performance forecasts.
The 2025 annual performance forecast recently released by Poly Developments and Holdings Group Co., Ltd. shows that the net profit attributable to the owners of the parent company is expected to be 1.02 billion yuan, a year - on - year decrease of 79.49%; the net profit after deducting non - recurring gains and losses is 628 million yuan, with a year - on - year decline of up to 85.25%. The net profit scale has shrunk by nearly 4 billion yuan compared with the previous year, and the profit margin has been continuously compressed.
The decline in profitability of China Merchants Shekou Industrial Zone Holdings Co., Ltd. is also severe. The company's announcement shows that the net profit attributable to shareholders of the listed company in 2025 is expected to be between 1.005 billion yuan and 1.254 billion yuan, a year - on - year decline of 69% to 75%; the net profit after deducting non - recurring gains and losses is only between 154 million yuan and 231 million yuan, with a year - on - year decline of 91% to 94%.
As of now, 6 out of the top 10 real estate enterprises have released performance forecasts. Among them, Vanke and Jianfa Real Estate have suffered losses, while Poly Developments and Holdings Group Co., Ltd., Greentown China, China Merchants Shekou Industrial Zone Holdings Co., Ltd., and Yuexiu Property Co., Ltd. have made profits, but their profits have all declined by more than 80% compared with 2024.
The fundamental reason for the significant decline in the profitability of leading real estate enterprises is that the industry as a whole has entered the stage of "balance - sheet contraction and clearance". High land acquisition costs in the early stage, the decline of project settlement scale and gross profit margin, and the increase in impairment provisions for some project assets are common problems faced by real estate enterprises in the industry, which directly lead to a serious shrinkage of profits.
It is worth noting that against the background of generally pressured profitability, leading real estate enterprises have placed "financial stability" at the core, and optimizing the debt structure has become a common understanding in the industry. In addition to Greentown China, central - state - owned real estate enterprises such as China Resources Land Limited and Poly Developments and Holdings Group Co., Ltd. have also continuously promoted de - leveraging and debt reduction. The total bond financing in the real estate industry in 2025 increased by 10.5% year - on - year. The overseas bond issuance of leading real estate enterprises has gradually broken the ice, and the industry's balance sheet has been substantially repaired. Data from the China Index Academy shows that a total of 21 troubled real estate enterprises have completed debt restructuring in 2025, with a total debt resolution scale of about 1.2 trillion yuan. The industry's debt risks have been effectively alleviated, but the profit pressure has not dissipated, becoming the main challenge during the industry's transformation period. However, at present, the profit contribution of light - asset businesses is still relatively limited and difficult to fully offset the decline in profitability of traditional development businesses. The industry's profit recovery still takes time.