Trailing net profit reached 5.3bn, fell 7.6bn compared with the same period last year. Offsetting pressure came mainly from higher finance costs, higher administrative expenses, and lower gross profit. Detailed impact is shown below:

Is growth real and durable?

Trailing-12-month revenue declined 85.1% year on year — not from a single spike: quarterly growth stepped up from −21% to +11%.

2 of the last 4 quarters grew year on year.

Net margin fell to −77.97%, losing 83.0pp. The main pressure is SG&A / Revenue rose 33.2pp, outweighing the improvement in Gross margin rose 8.2pp (with lingering pressure from Net financial result / Revenue fell 65.8pp).

The pressure comes from non-core items while core operations hold their rhythm — margin has a basis to recover once this factor passes.

Developer revenue is recognised at handover — large swings between quarters are a property-sector feature, not a business trend. Read on a TTM basis and against the delivery schedule.

2021Q3: 40.5bn

2021Q4: 1.5bn

2022Q1: 1.3bn

2022Q2: 1.9bn

2022Q3: 1.8bn

2022Q4: 1.7bn

Is profit converting into cash?

Leverage needs watching — cash flow shows the ability to service debt from operations. Operating cash flow reached 12.8bn against investing cash flow of 0.0bn (annual cash-flow figures for 2022).

Post-investment cash flow was positive +12.8bn. Financing cash flow was positive 0.0bn.

CFO / net income was −2,41 lần.

After spending 0.0bn on fixed-asset investment, the business generated trailing free cash flow of +12.8bn.

For residential developers, FCF and CFO swing with project cycles — negative during investment phases and positive at handover — not representative of single-year efficiency.

How much income is non-core?

Non-core income reaches 84.4% of pre-tax profit — core earnings are thinner than the headline.

Within that, net financial result at +84.4%, other profit at +0.0% of PBT.

ROIC narrowed to −0.86%, falling 1.2pp. That translates to −0.86 in after-tax operating profit for every 100 units of operating capital. Both NOPAT margin narrowed 83.0pp and capital turnover fell 0.06x, with invested capital holding roughly steady — pressure came from both operational efficiency and asset efficiency.

For real estate developers, ROIC moves with project cycles — this is a reference signal, and the real assessment needs upcoming handover periods.

Leverage warrants monitoring, with net debt / equity at 5.44x and interest coverage only at −1.18x.

At present, short-term debt accounts for 100.0% of total debt, cash equals 3.0% of debt, and total debt stands at 527.9bn.

Leverage for residential developers should be read alongside project cycles, development inventory, and handover timing.

ROIC for residential developers swings with project cycles and handover timing. Leverage is well above the real estate sector norm — liquidity risk becomes material if handover slips — liabilities at 16.45x equity, net debt at 5.44x equity.

Customer advances 24.8bn (as of 2022Q4) — deposits on units/projects not yet handed over: revenue already sold but not yet recognised, a lead indicator of profit in upcoming delivery quarters. Advances cover only 1.76% of current inventory — most of the pipeline is not yet pre-sold.

Customer advances: 24.8bn · YoY −0.6bn · QoQ −0.0bn

Locked-in revenue: ~14.57x quarters of revenue (TTM)

Inventory pre-sold: 1.76%

Project inventory splits in two at 2022Q4: 1,410.2bn near-delivery stock (short-term) and 0.5bn construction-in-progress (long-term). Weighted toward near-delivery — the revenue-recognition cycle is approaching.

Near-delivery (ST): 1,410.2bn (99.97%)

Construction-in-progress (LT): 0.5bn (0.03%)

For a developer the question is not debt-to-equity but whether borrowings are backed by the project pipeline. At 2022Q4, net debt 512.1bn vs project value 1,410.6bn — ratio 36.30%; the project pipeline backs net debt 2.75x over.

Net debt / project value: 36.30%

Development inventory ended the period at 1,410.2bn, about 85.8% of total assets — reflecting projects in progress awaiting handover.

Over the last 12 months, working capital released 0.0bn of cash.