TOL Latest Report

Financial Performance Review

Toll Brothers' total operating revenue for January 31, 2025 was RMB1.8591 billion, a decrease of RMB370 million, or approximately 1.90%, from the same period in 2024. This change reflects the challenges faced by the company in the competition market, sales strategy, and macroeconomic environment, especially the decline in operating revenue.

Key Financial Data

1. Decline in Operating Revenue: Operating revenue in 2025 was RMB1.8591 billion, a 1.90% decrease from the same period last year, indicating weak market demand.

2. Slight Decrease in Sales Costs: Sales costs were RMB1.3995 billion, slightly lower than the RMB1.4094 billion in the same period last year, although the overall gross margin may still be affected.

3. Increase in Marketing Expenses: Marketing, sales, and general and administrative expenses increased to RMB2.4044 million, up from RMB2.3004 million in the same period last year, which may further compress net profit.

4. Negative Subsidiary Income: The share of subsidiary income was -RMB87.43 million, indicating losses in non-core businesses, affecting overall financial performance.

5. Macroeconomic Pressure: Economic uncertainty and declining consumer confidence may further lead to sales decline.

Peer Comparison

1. Industry-wide Analysis: The construction industry as a whole faces a growth slowdown, with many companies reporting a decline in operating revenue, reflecting the double pressure of insufficient market demand and rising costs.

2. Peer Evaluation Analysis: The decline in Toll Brothers' operating revenue is not particularly prominent in the industry, but attention should be paid to changes in market share and the performance of competitors to assess its relative competitiveness.

Summary

Toll Brothers' financial performance in the first quarter of 2025 is affected by multiple factors, including intensified market competition, poor cost control, and macroeconomic uncertainty. Although the decline in operating revenue is not severe in the industry, the company still needs to take effective measures to cope with competitive pressure and sales challenges.

Opportunities

1. Expanded Product Line: The company can attract more customers and enhance market competitiveness by expanding its product line and geographical footprint.

2. Policy Support: The construction industry is expected to receive more policy support, especially in infrastructure investment, creating development opportunities for the company.

3. Postwar Reconstruction Demand: With changes in the international situation, the construction industry may see postwar reconstruction demand, promoting sales growth.

Risks

1. Intensified Competition: Competition in the industry may continue to intensify, leading to lower sales prices and reduced market share.

2. Rising Sales Costs: Although sales costs have decreased slightly, improper cost control may affect gross margin and net profit.

3. Macroeconomic Uncertainty: Economic uncertainty may continue to affect consumer confidence and sales performance.