The year of 2022 is undoubtedly a challenging year. As tens of thousands of enterprises in China underwent cyclical challenges, the survivors successfully withstood the "shocks from the era" and found certainties among uncertainties.

Times Neighborhood always formulates strategies based on the unaltered rather than placing the focus on changes in the future. This is the connotation of “Long-Termism” that Times Neighborhood adopts. "Unaltered" does not mean that the Times Neighborhood’s team is opposed to changes, we rather progress through obstacles with an active attitude that embraces transformation and innovation, as always, which makes every one with steps grounded and ready for a pleasing future that welcomes us proactively.

Under the dual pressure from the macro-economy and the industry cycle, Times Neighborhood courageously confronted difficulties with unwavering adherence to the development strategy of long-termism. The Group maintains a strong foundation backed with high-quality property management services, continues to develop high-quality scale expansion and conducts its advantageous businesses with long-term value. With unwaveringly clear strategic focus and execution ability, the Group laid a solid foundation for its long-term and sustainable high-quality development in the face of an uncertain future.

On March 29, 2023, Times Neighborhood Holdings Limited (stock code: 9928.HK, "Times Neighborhood" or the "Group") released its 2022 annual results. During the Reporting Period, the Group recorded a revenue of RMB 2,606 million, a gross profit of RMB 556 million, a gross margin of 21.3% and a core net profit attributable to shareholders of approximately RMB 143 million.

(Click the picture to see more of Times Neighborhood's annual premium projects in terms of business expansion.)

During the Reporting Period, the management scale of Times Neighborhood achieved a stable growth and 88 cities were covered by its service with 956 projects under management (excluding urban public service projects). The total contracted area was approximately 134 million square meters and the area under management was approximately 119 million square meters.

Guided by the "4321" core strategy, the Group continued to be deeply engaged in four core urban agglomerations, with a focus on areas with high economic growth. Due to the unremitting efforts of the market development team and the in-depth review by the operation team, we optimize ordinary projects that do not conform to long-termism and do not have high-potential. Thus, the concentration of project arrangements was further enhanced and the management scale of the Group in first- and second-tier cities accounted for 75.0% of total gross floor area. Meanwhile, in the process of marketization and independence, we constantly developed our ability to expand independently. The contracted area secured by Times Neighborhood through third parties was approximately 19.85 million square metre.

In terms of business layout, Times Neighborhood achieved collaborative development by integrating brand resources in various business forms and enabling three core business forms. In terms of residential business, we continuously improved the management density of core urban agglomerations. In terms of the industrial park business, we continuously deepened our cooperation with major property owners and established cooperative relationships with six new major property owners. In terms of the public building business, we actively broaden the service scope, and on the basis of the existing public building management scale, we acquired segmental representative projects. 

With the “technology+service” platform for the whole life cycle, Times Neighborhood further tapped into the value of the communities under management. With various matrices including the Neighborhood Services App and mini program, we carried out user management, improved user profiling, constantly upgraded business development models and enriched service product matrices. 

In terms of the renovation business, Times Neighborhood opened brand image stores to connect offline and online spending scenarios and promote traffic conversion.  Active responses were made in light of the downturn in the real estate market, including surmounting the existing market and exploring our self-operated business, and having developed the self-operated overall decoration store with excellent performance. We actively gained insights into the needs of property owners, gave full play to the advantages of property companies that are close to property owners, carried out community group buying, provided various paid home-based services, and targeting at various daily life scenarios, designed and matched product sets, so as to provide rich quality goods and resident services for property owners and customers. During the Reporting Period, the revenue from the community value-added services was RMB378.6 million with a gross margin of 32.9%.

(Click the picture to check the summary of the Initial Plan 2.0.)

With over 20 years of experience in the property management industry, Times Neighborhood is aware that by adhering to the original aspiration of providing services, actively thinking, courageously conducting innovation, and fearlessly taking actions, we can fulfill our service commitments with professionalism and dedication and consolidate the foundation for its long-term development with the consistent high-quality services.

The Group always upholds the business philosophy of “surprise customers with quality and move customers with service" and drives service innovation with the belief in "quality first". In 2022, the Group launched the Initial Plan 2.0 to deepen service actions based on the previous achievements in quality development. Through the upgraded actions of "initial aspiration, beautification, renovation, and safety", the quality of community life was improved in an all-round manner with the focus on service, environment, construction projects and safety. Moreover, in face of epidemic outbreaks in multiple cities, such as Guangzhou, Shanghai and Chengdu, the front-line personnel of Times Neighborhood actively participated in COVID-19 prevention and control by assisting in the completion of tens of thousands of nucleic acid tests, so as to safeguard the community.

(Click the picture to review Times Neighborhood's annual premium community events.)

In terms of community cultural development, Times Neighborhood responded to the national call for "co-development, co-governance and sharing" by establishing a number of characteristic service brands IP, including the "Welfare Creation Festival", the "Happy Life Festival", the "Neighborhood Super Service Day" and the "Neighborhood Dessert Shop". We adopted multiple forms of innovative publicity, including the planning of thematic publicity serial videos and the promotion of a series of community conventions, to improve property owners' knowledge of community management, such as fire safety, garbage classification, and pet keeping etiquettes. These measures enrich the spiritual and cultural life of property owners and enable the Group to create a harmonious community atmosphere. This not only provide concrete support for the Group's brand image and business expansion, but also facilitate the improvement in our service image and customer satisfaction.

Service solves one problem at a time, but a platform continues problems solving. Times Neighborhood maintained high-quality property management services to be its development foundations, and made concerted effort to develop the full-life-cycle "Technology + Service" platform, integrated cultural strength into smart technology, and used technology to bring a better life to people more effectively. Currently, Times Neighborhood has completed the intelligent upgrade of corporate management, the optimization and quality-improvement of the service platform, and the repositioning of service scenarios.

In terms of corporate management, through the improvement of the business and financial integration, the Group made the procedure clear, identified data breakpoints, comprehensively made order delivery and performance accounting online, and reduced labor energy consumption by 72%. Meanwhile, we continued to promote data governance, exploited the value of data assets and promoted the continuous improvement of our operation management system. Through the deepening of the development of our capability of data separation and based on smart tools and standardized specifications, the Group formulated a firewall with smart management that could flexibly adapt to a diversity of scenarios. In doing so, the Group achieved the comprehensive data-based operation and management that was online, lean and automatic, which facilitated the Group's business diagnosis and efficient decision-making.

In terms of the service platform, the Group conducted efficiency improvement of its information systems with the focus on three major core aspects: "management systemization, service platformization, and data central platform integration". By completing the upgrading of “Neighborhood Services + Neighborhood Home" App through integration, the Group empowered its front-line employees to optimize a total of 106 functional points of operation tools and increase the per capita area under management by 27%, in order to comprehensively improved the Group's service quality.

In terms of digital innovation, Times Neighborhood has completed the repositioning of service scenarios. The service channels covered all high-frequency requirements and pain points in service scenarios with unified service standards, management logic and link-up access. With these error and omission prevention measures, the Group not only improved the checking efficiency and reduced costs and fees, but also improved the experience and benefits of property owners and employees.

(Click the picture to read the ESG report of Times Neighborhood.)

Times Neighborhood made active breakthroughs in environmental, social, and governance (ESG) governance and deepened the organic integration of corporate governance, social responsibilities and environmental protection. In June 2022, the Group earned an ESG ratings from S&P Global Ratings, an international rating agency, becoming the first property company in China to obtain the S&P ESG rating. 

The Group also actively promoted carbon reduction actions in communities. Through a series of publicity sessions and events, such as the smart and energy-saving upgrading of facilities and equipment and the "Recycling for a Better Life Project with Carbon Reduction Officers in Neighborhood", the Group appealed to its customers to pay attention to carbon emissions in their lives and to build a green community together.

In the future, the Group will continue to make efforts in ESG according to the feedback on its rating experience and S&P's analysis, so as to achieve comprehensive improvement in line with relevant standards, and to duly contribute to the sustainable development of society, the environment and the enterprise.

Looking into the future, the 20th CPC National Congress Report and the Central Economic Work Conference have pointed out the direction for national development. The positive statements and policy changes for the upstream real estate industry boost the market's confidence in development, bringing clear prospects for society, the economy and industries. In this context, as the property management industry is closely related to people's livelihood at the community level, this will bring more development opportunities. Property management enterprises shall make more efforts to improve their professional abilities and service quality, and continue to explore the segmented service sectors.

In 2023, Times Neighborhood will continue to uphold the philosophy of long-termism, and progress through obstacles with an active attitude that embraces transformation. We will make efforts in “persistence in four aspects”, namely persisting in winning trust with high-quality services, constantly enhancing service capabilities, enriching service connotations, and attentively “creating services” for property owners to realize the corporate mission of “enable more people to enjoy a better life”; persisting in quality growth, forging ahead and seizing market opportunities, further enhancing the independent expansion ability, deepening the quality of expansion, and improving the management density; persisting in the high-quality improvement of economic benefits, focusing on the in-depth development of value-added services, continuously tapping into and meeting the real needs of customers, and exploring promising business segments to create new growth curves; and persisting in optimizing organizations to enable businesses, actively promoting organizational reform, building a talent team that is sensitive to change, flexible and innovative with the ability to quickly iterate, consolidating the foundation of sustainable development of enterprises, and making the comprehensive ability of organizations continuously match the development progress of enterprises.

We will work with high morale and make continuous improvement. We believe that as long as we stick to the correct strategic direction, we can eventually traverse the cycle and find the structural strength of self-growth. In 2023, a year of economic recovery and catchup for China, Times Neighborhood will stick to its beliefs and make persistent efforts to give back to our property owners, shareholders, employees and partners with solid and high-quality development achievements.