Yanlord Land Group - DBS Research 2025-03-04: Deleveraging In Progress, Eyes On Business Strategy.

• Yanlord (SGX:Z25)'s FY24 revenue fell 16% y-o-y, mainly led by a 18% decline in development booking (15% increase in GFA delivered more than offset by 29% decline in ASP). Gross margin fell 9.7ppts to 9.4% vs 19.1% in FY23 (~18.7% if excluding the RMB3.4bn inventory write-down).

FY24 results below expectations on inventory write-downs and sizable impairments.

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• SG&A % of presales rose 1.4ppts to 7.7%, due mainly to a further contraction in presales.
• Share of profit from JVs jumped to RMB671mil (vs. a RMB43m loss in FY23), led mainly by the recognition of profits from Hangzhou Bay in Hangzhou and Oasis Mansion in Shanghai. Attributable net loss jumped to RMB3.4bn, widening from the RMB486m loss in 1H24.
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Deleveraging continued.

• Total debt fell 12% h-o-h as Yanlord continued to pare down debt, whilst total cash fell by a smaller magnitude of 4%. Net gearing saw a notable improvement of 4ppt to 41.2%.
• Yanlord’s near-term liquidity looks manageable with remaining debt consisted of
  1. RMB development loans;
  2. SG IP loan; and
  3. US$500m senior note 26’.
• Among RMB10.2bn cash on hand, RMB3bn was kept in presales escrow account and non-restricted cash to ST debt stayed healthy at 1x, improved from 0.8x in FY23.

Future business direction will be key to watch.

• Read more at SGinvestors.io.

Dexter Chun DBS Group Research | Jason Lam DBS Group Research | Ben Wong DBS Group Research | https://www.dbs.com/insightsdirect/ 2025-03-04 SGinvestors.io

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