Yuyuan Group reports first loss in 33 years since listing: real estate-related company releases impairment risk with a "lighter load"

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This year, the A-share market has seen multiple mergers and acquisitions involving state-controlled listed companies planning to shift their focus from real estate to other main businesses.

As the A-share annual report disclosure enters a concentrated period, the asset impairment risks of real estate and real estate-related diversified companies continue to be exposed. On March 24, Yuyuan Inc. (600655.SH) disclosed its 2025 annual report, revealing that massive asset impairments led the company to report a net loss attributable to shareholders for the first time in its 33 years since going public.

Not long ago, China Merchants Shekou (001979.SZ) also announced an asset impairment provision exceeding 4.2 billion yuan; China Metallurgical Group (601618.SH) forecasted that provisions for impairments on various assets, including inventory, fixed assets, and investment properties, would exceed 26 billion yuan; Poly Developments (600048.SH) reported asset impairment losses and credit impairment losses totaling approximately 6.9 billion yuan; Vanke A (000002.SZ) expects a net loss attributable to shareholders of approximately 82 billion yuan in 2025, marking the largest annual loss in A-share history, primarily due to provisions for inventory impairments between 45 and 55 billion yuan.

In the context of adjustments in the real estate industry, these impairment cases are not isolated. More listed companies with real estate assets still face impairment pressures, and the market needs to be vigilant about related risk transmission.

According to First Financial reporter statistics based on WIND data, over 90 A-share real estate and real estate-related companies reported a combined book value of inventories and investment properties of 5.18 trillion yuan at the end of 2023, which fell to 3.98 trillion yuan by the end of the third quarter of 2025, a decline of 23%. Besides the reasons for sales de-stocking, asset impairment is also a significant factor.

Yuyuan Inc. reported an asset impairment of 1.889 billion yuan, marking its first loss in 33 years.

Yuyuan Inc.'s 2025 annual report shows that the company achieved a net loss attributable to shareholders of -4.897 billion yuan for the year, the first annual loss since its listing in 1992, primarily due to provisions for various asset impairments totaling 1.889 billion yuan. Among these, impairments related to real estate assets accounted for over 60%, becoming the core factor dragging down performance.

From an industry perspective, Yuyuan Inc.'s massive impairments result from the resonance of the industry environment and company strategic adjustments. On one hand, the domestic real estate industry remained sluggish in 2025, with national commodity housing sales area down 8.7% year-on-year and sales revenue down 12.6% year-on-year, creating de-stocking pressure. Yuyuan Inc.'s real estate sales revenue and sales area both declined by nearly 50%, prompting projects in multiple cities to “exchange price for volume,” triggering asset impairment tests.

On the other hand, the company is actively pursuing a strategic contraction, shifting from a dual-core business model of “real estate + consumption” to focusing on its core gold and jewelry business, while the real estate sector has shifted from a core growth driver to a non-core sector. The company chose to provision for inventory impairments involving projects in multiple cities during the industry adjustment period, clearing real estate risk burdens all at once.

The significant impairments in 2025, coupled with the decline in its main business, directly caused the net profit attributable to shareholders to drop, leading to the company’s first loss since its listing.

By the end of 2025, the company’s jewelry and fashion business revenue accounted for over 60%, indicating that the transformation effects are gradually becoming apparent, but short-term performance is still dragged down by impairments.

Annual Report Season Risk Warning: More Impairments Ahead

In addition to Yuyuan Inc. and similar real estate-related companies, leading real estate firms also face significant asset impairment pressures.

On March 17, China Merchants Shekou announced that it would provision a total of 4.27 billion yuan for asset impairments in 2025, including 3.269 billion yuan for inventory impairments. This impairment provision directly reduced the company’s net profit attributable to shareholders by 2.918 billion yuan for the 2025 fiscal year.

Earlier, Vanke A projected a net loss attributable to shareholders of approximately 82 billion yuan in 2025, setting a record for the largest single-year loss in A-share listed company history, primarily due to provisions for inventory impairments of 45 to 55 billion yuan, compounded by losses in investment properties and increasing losses in joint ventures.

Beike (601828.SH) expects a loss of 18 to 22.5 billion yuan in 2025, primarily due to fair value losses of 12.6 to 21.5 billion yuan in investment properties, as well as provisions for various asset impairments of 4.5 to 5.7 billion yuan, significantly affected by the sluggish real estate industry and declining demand in home retail. This marks Beike’s third consecutive year of losses, with the loss amount increasing year by year, completely wiping out its cumulative profits since its listing in 2018 by 2025.

Greenland Holdings (600606.SH) expects a loss of 16 to 19 billion yuan, resulting from provisions for impaired inventories with risks, declining revenues from real estate and infrastructure businesses, and increased financial expenses.

OCT A (000069.SZ) expects a loss of 13 to 15.5 billion yuan, involving impairments in both the cultural tourism and real estate sectors, with theme parks, commercial complexes, and residential projects facing downward valuation pressures.

Jianfa Co. (600153.SH), as a diversified enterprise, expects its real estate sector to incur a loss of 5.2 to 10 billion yuan in 2025, marking its first annual loss in 28 years since its listing, primarily due to inventory impairments and losses from Beike (in which Jianfa Co. holds a 29.95% stake) — not only resulting in unrealized losses from the decline in share prices but also needing to bear operational losses from Red Star Meikailong.

China Metallurgical Group forecasts a profit in its annual report but anticipates losses in its real estate business, also announcing that it will provision for impairments on inventories, fixed assets, and investment properties, expecting these provisions to exceed 26 billion yuan.

Poly Developments reported asset impairment losses and credit impairment losses totaling approximately 6.9 billion yuan, reducing the net profit attributable to shareholders by about 4.2 billion yuan for 2025.

Impairment Pressures Faced by These Companies

Industry insiders suggest that given the current deep adjustments in the real estate industry, the following types of companies may face real estate impairment risks:

The first category includes traditional diversified groups, including consumer, manufacturing, and comprehensive groups involved in real estate, where the real estate sector was once a significant source of profits or growth.

The second category consists of enterprises undergoing asset restructuring in the context of SOE reform, where mergers and acquisitions of state-controlled listed companies are accelerating. According to First Financial reporter statistics, there have been multiple merger events involving state-controlled listed companies in the A-share market this year. Among them, “focusing on core businesses” has become a central direction, with some companies clearing real estate risks through impairments, while others achieve track switching through mergers and acquisitions, both serving the reform direction of SOEs to “streamline and focus on core competencies.”

The third category includes companies transitioning from real estate to other main businesses, which also need to provide substantial impairments to “lighten their load.”

The reporter compiled statistics on the changes in the combined book value of inventories and investment properties of 99 A-share real estate and real estate-related companies, visually reflecting the industry’s asset scale contraction trend.

Data shows that the combined book value of inventories and investment properties of these companies was 5.18 trillion yuan at the end of 2023, falling to 3.98 trillion yuan by the end of the third quarter of 2025, a decline of 23%. This change is partly due to project de-stocking in the context of the ongoing downturn in the real estate industry and closely related to large-scale provisions for asset impairments by companies. As all 2025 annual reports are disclosed, it is expected that this figure will decline further.