China Overseas Land expects pre-sales boost
China Overseas Land and Investment set a bold sales target for the year, despite market fears that demand is falling because of government measures to slow home sales.
The boost is expected to come from 'contracted' or pre-sold units, which it expects to increase by 19 per cent this year. Last year, contracted sales amounted to total gross floor area of 5.3 million square metres, up 11.5 per cent from 2009, and contributed record sales of HK$66.78 billion.
Announcing the company' results for 2010, chairman Kong Qingping forecast that contracted sales would amount to 6.3 million square metres this year. That would generate revenue of HK$79.38 billion, based on the average selling price of HK$12,600 per square metre in 2010.
'The mainland property market will be under pressure this year due to the introduction of tightening measures. But we believe our sales target is achievable,' Kong said.
'We have a sufficient land bank. Our brand is attractive to the mainlanders and demand from end-users remains strong.'
The company reported a 65.7 per cent rise in net profit to HK$12.37 billion - including a property revaluation gain and disposal of interests in three projects. It said turnover rose 18.7 per cent to HK$44.31 billion.
Profit from property sales grew 58 per cent to HK$16.7 billion, while rental income from investment properties jumped 50.7 per cent to HK$294 million. The company planned to increase its investment property portfolio from 310,000 square metres to 1.8 million square metres in the next five years.
The developer had acquired sites with a total gross floor area of 5.04 million square metres this year, 70 per cent of its 2011 acquisition target.
Kong said the firm would speed up expansion plans in third-tier and fourth-tier cities in central China. He said it may raise funds in Hong Kong in the first half of the year.
The firm declared a final dividend of 17 HK cents a share, up from 13 cents in 2009. Its shares ended 0.76 per cent up yesterday at HK$13.24.
