On August 28, 2026, SINO-OCEAN SERV (06677) released its interim results for the first half of 2026. The presentation was attended by Mr. Yang Deyong, Co-Chairman of the Board, Mr. Hou Min, Chief Executive Officer, Ms. Zhu Geying, Chief Financial Officer, and Ms. Zhou Ying, General Manager of the Capital Markets Department.
During the first six months of 2026, SINO-OCEAN SERV generated revenue of RMB 1.29 billion, with third-party income accounting for 93.5% of total revenue, further consolidating its business independence. Non-cyclical revenue made up 77.7% of the total, significantly enhancing revenue stability. The gross profit margin improved by 3.8 percentage points year-on-year to 15.5%, while the core net profit margin attributable to shareholders reached 6.3%. The company held cash of RMB 640 million, with net operating cash flow of RMB 240 million.
Following the proactive strategic adjustment to divest non-core and low-efficiency businesses, the company has focused on four strategic directions: core cities, core projects, core products, and core teams. This approach has led to continuous improvements in both revenue quality and profitability.
Focusing on core cities: Optimizing layout while enhancing expansion quality
The company is strengthening its brand presence in key urban centers, deepening density in established cities, and executing a market expansion strategy that balances scale with quality, directing resources toward core cities. As of June 30, 2026, SINO-OCEAN SERV managed a total area of 84.48 million square meters, with first- and second-tier cities accounting for 81.1% of the portfolio. The average property management fee stood at RMB 2.9 per square meter per month, positioning the company at the upper-middle level of the industry. Core cities accounted for 77.3% of total managed area, with Beijing alone contributing 11.585 million square meters, where brand effects and urban density are creating synergistic value.
In terms of external expansion, the company continues to prioritize core cities and high-quality projects. In the first half of the year, newly added annual contract value reached RMB 130 million, up 76% year-on-year. The company secured 50 new projects across 22 cities, with 68% located in core cities, and added 25 new clients. State-owned enterprise and government procurement clients accounted for over 50% of the project pipeline, providing strong contract performance capabilities, stable cash flow, and significant potential for continued development. The company also strengthened its non-residential business segments, including hospitals, commercial offices, and schools, achieving landmark breakthroughs during the period and gaining widespread market recognition for its service capabilities in these sectors.
Strengthening core projects: Benchmark leadership and high-quality implementation
The company has implemented a tiered project management system, applying differentiated operational strategies to projects of varying levels to optimize resource allocation efficiency and drive the profitability of core projects. By enhancing capabilities in serving clients, the company ensures services deliver tangible value and build sustainable relationships, creating a core competitive advantage. A total of 67 service touchpoints have been designed around the full client lifecycle, implemented across different project types.
In community co-creation and co-governance, the company organized 1,283 community events, reaching 228,000 participants. Its first national table tennis tournament spanned 16 cities, attracting over 1,500 homeowners. Eleven projects have established tripartite collaborative governance mechanisms, with the "one party member per building" model at Hangzhou Dahe Chenzhang recognized as an innovative example of grassroots governance.
Optimizing core products: Segment-specific strategies and enhanced service capabilities
The company is strengthening its product capabilities with a foundation in basic property management services. For the residential segment, the focus is on stabilizing the core business; for commercial and public building segments, the emphasis is on professional enhancement and market-oriented expansion; value-added services are being redirected toward genuine client needs; and digitalization supports customer experience, operational efficiency, and transparent management. The overall service system aims to achieve services that are identifiable, replicable, priceable, and sustainable.
Residential service standards have been comprehensively upgraded. Focusing on high-frequency customer touchpoints, the company has refined service specifications around "three spaces and five scenarios," established a "core city/core project tiering" matrix, and created service benchmarks by tier. The basic service classification system has been iterated, enriching the personalized product library. Quality control has been institutionalized through high-frequency full-staff inspections and a work-order system.
For the commercial and office segment, the company has refined its service menu, establishing a standardized product system comprising four categories of basic services and N menu-based optional value-added services. During the period, commercial and office property management revenue reached RMB 160 million, covering 73 projects with a managed area of 6.036 million square meters, laying the foundation for large-scale expansion of non-residential operations.
Community value-added services have been restructured to focus on homeowner needs, with the gross profit margin recovering to 39.0%. The home services system has been upgraded with the launch of housekeeping booking and group-buying modules, integrating online browsing, ordering, and door-to-door delivery. Community retail, home services, and in-home elderly care have adopted standardized business frameworks, with a replicable profit model taking initial shape.
Core teams: Talent quality enhancement and organizational capability building
The company is reshaping the quality of its core team to build a stable, sustainable talent pipeline. Management is taking a frontline approach through the "listening action" initiative, with senior and mid-level executives visiting projects monthly to resolve specific issues, ensuring decisions remain grounded in frontline realities. Project leadership is being expanded through the "Cornerstone Plan" and "Elite Plan" programs for project manager development, establishing mechanisms for learning growth and experience replication to enable rapid internal dissemination of best practices. Frontline productivity is being improved through personnel reuse around work scenarios, rewarding high performers, and facilitating stepwise employee growth through star ratings combined with training-and-practice mechanisms.
Rebuilding operational quality and building long-term competitiveness
In the first half of 2026, SINO-OCEAN SERV pursued "quality over quantity," using structural adjustments to build long-term competitiveness. Its operational foundation has become more solid, and its path toward high-quality development is increasingly clear. The company's overall strategy adheres to three-dimensional synergy and integrated development, guided by a "customer-first" orientation, supported internally by a "people-first" approach, and aimed at "shareholder value" as its core objective, comprehensively reinforcing the foundation for sustainable growth.
The core development strategy focuses on two main tracks: first, continuously improving customer service capabilities and service quality, building core competitiveness through high-quality customer service while simultaneously optimizing the service system, cash flow, and accounts receivable quality; second, using core teams, core cities, and core products as key drivers to reform resource allocation models, breaking away from previous fragmented and equalized distribution patterns, and channeling resources toward core business segments in a focused and concentrated manner, forming an efficient, internally and externally coordinated long-term operational system.