Chinese real estate agent KE Holdings soars after rising revenue despite turning profits into losses

(Yicai Global) Mar 10 – Shares of KE Holdings surged after China’s largest online real estate agency reported an increase in revenue last year, despite turning profits into a net loss of 525 million of CNY (82 million), mainly due to higher personnel expenses, provision for credit losses and impairment of goodwill.

KE Holdings [NYSE: BEKE] closed nearly 7.8% higher at $14.46 yesterday. In after-hours trading, the stock rose 3% to $14.89 at 7:59 p.m. local time.

Net loss in 2021 compared to a net profit of CNY 2.8 billion (USD 443 million) a year earlier, according to the earnings report that online real estate agent operator Beike Zhaofang released yesterday. Revenue increased 14.6% to CNY 80.8 billion (USD 12.7 billion), driven by a 10.1% increase in total gross trading volume to CNY 3.9 trillion (USD 604.7 billion). USD).

“We achieved 14.6% revenue growth for the full year of 2021, demonstrating our resilience despite the sharp market decline in the second half of last year,” said Xu Tao, Executive Director and Chief Financial Officer of Beike. “We will tread carefully, but dream big, as we commit to investing more in the huge and growing ‘better living’ industry, such as our renovation and furnishing services, and our inclusive housing services. “

Net revenues from existing home transaction services and new home transaction services increased by 4.5% and 22.5%, respectively, in 2021 compared to the previous year. Total operating expenses climbed 22.5% to CNY 17.2 billion (USD 2.7 billion).

For the fourth quarter of last year, the Beijing-based company’s net loss was CNY 933 million, compared to a net profit of CNY 1.1 billion in the same period of 2020. Revenue fell 21 .5% to reach 17.8 billion CNY and its gross trading volume was 732.4 billion CNY (114.9 billion USD), down 34.6%.

KE Holdings expects first-quarter revenue to decline between 39.6% and 44.4% to CNY11.5 billion to CNY12.5 billion this year compared to the same period in 2021.

Beike had more than 51,000 stores as of December 31, 2021, up 8.7% from the previous year. Its number of agents fell 7.8% to 454,504 during the same period. Monthly active users fell 22.4% to 37.4 million.

Publisher: Futura Costaglione