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In 2022, China’s property industry started on a new cycle of “changing gear and slowing down”. In the past two years, the surfacing of unexpected factors such as the COVID-19 pandemic, austerity measures on the industry and changes in the financing environment, coupled with weaker medium- and long-term housing demand have created cash flow pressure and operating challenges for most property companies. According to National Bureau of Statistics of China data, the nationwide real estate development investment amounts in 2022 fell for the first time since 1999, and the results of the top 100 property enterprises altogether declined by more than 40% year-on-year. Although the government timely launched a number of positive policies at the end of the year, stressing that the property sector is a pillar industry in the country, those policies have yet to produce effect. Thus, despite the Group pulling out all the stops in the battle,it was not able to buck the adverse marco-economic trend. In 2022, the Group’s overall turnover amounted to HK$1,517,000,000, representing a decrease of 43% as compared with 2021. Loss attributable to shareholders was HK$580,000,000. The Board of Directors did not recommend the payment of a final dividend for the year ended 31 December 2022.
CONTINUED TO FOCUS ON CORE PROPERTY REAL ESTATE AGENCY SERVICES BUSINESS AND EXPLORE NEW OPPORTUNITIES IN COORDINATION WITH OTHER BUSINESSES
Capitalizing on its years of operating experience and rich customer resources, the Group was able to navigate the uncertainties in 2022 and delivered stable performance. It moved forward with prudence, continued to penetrate key cities quickly urbanizing and of higher value, and stayed alert and responded shrewdly to market changes. In addition, the Group continued to optimize the “AI Hopefluent” platform, adopting live broadcasting and other new media marketing approaches and internet technologies to avail including “cloud” tour of flats and VR sample flats. Its hope was to effectively integrate Internet service models and on-site marketing approaches, thereby drive development of the traditional property real estate agency services business.
To better allocate resources, the Group also reviewed the operational performance of its businesses and made strategic adjustments. In April, the Group and Poly reorganized and integrated real estate agency services business. In November, Country Garden Services increased its shareholding in the Group so that the two parties could marry strengths in developing property brokerage business and value-added real estate service business, finding new opportunities for long-term development of the companies.
With government policies yet to bear result, the market was still trending down, inevitably affecting the Group. During the year under review, turnover of the Group’s real estate agency services business amounted to approximately HK$1,426,000,000, representing a decline of 43% from HK$2,489,000,000 in 2021.
The Group’s financial services business was also affected by such factors as the market shrinking with the external environment unstable, thus turnover of the business dropped markedly year-on-year to HK$91,000,000 in 2022.
CONCLUSION
For China, “development” is above all else in 2023, thus recovery of the property market is imperative, and the recent government policies enforced substantiated that statement. The same goes for the property industry deemed an economic pillar. As the Chinese economy moves towards being “more open” and “higher quality” development, the property industry has become the “slow bull” that guides recovery of the domestic circular economy, the role it should play as a “pillar industry” under the new normal.
I believe the property market will gradually warm up this year, and the relevant indicators of the property market are also expected to improve. On its foundation built over the past more than 20 years, the Group will remain cautiously optimistic, continue to cultivate key cities leading in economic development, and also keep assessing market conditions and adjusting its business development directions and resource allocation, so as to seize opportunities to promote overall growth in results.
On behalf of the Group and the Board of Directors, I would like to thank all Hopefluent staff for their hard work and contribution. I also sincerely thank all shareholders, customers, business partners and investors for their support and trust over the years. The Group will continue to work as one, be pragmatic in action, with the aim of creating better returns for shareholders.