K Wah keeps the faith despite curbs
Mid-tier developer plans to speed up sales of mainland projects and acquire sites after underlying profit jumps 236 per cent for last year
K Wah International, the mid-tier developer, plans to speed up sales of mainland projects to offset the impact of cooling measures on both sides of the border.
Executive director Paddy Tang Lui Wai-yu said yesterday that the cooling measures had affected the property markets in Hong Kong and on the mainland but it hoped its businesses would be in balance.
Alexander Lui Yiu-wah, also an executive director, is confident about property sales on the mainland despite the new round of tightening.
"The measures will mainly affect second-hand homes. As we are targeting the primary market and end users, the impact will be limited. Our property sales could be maintained," he said.
Chairman Lui Che-woo said the company would continue to acquire sites in Hong Kong and on the mainland as it was sitting on a cash pile of HK$7.24 billion.
KWah has spent HK$5 billion on buying five sites in Hong Kong and on the mainland, which boosted its land bank to 1.8 million square metres.
"The Hong Kong government's cooling measures are aimed at helping local people buy flats at a reasonable price. I believe property prices will become stable in future. It is a good time to buy a flat for own use. But you have to be cautious if you buy them for speculation," Lui Chi-woo said.
The developer planned to launch a total gross floor area of 200,000 sqmetres for sales in Hong Kong and on the mainland this year, chief financial officer Herbert Hui said.
But he declined to disclose the contracted sales target for this year. In 2012, the company generated HK$7.5 billion from property sales.
"There was HK$5.2 billion from contracted sales that has been booked in the financial year of 2012. The remainder has not yet been booked [because the projects have not been completed during the period]," Hui said.
KWah planned to launch the remaining flats at Marinella in Aberdeen, Chantilly on Stubbs Road, Providence Bay and Providence Peak in Tai Po this year. Its new projects in Hong Kong also include one in Tai Po and a luxury development on Grampian Road.
On the mainland, The Palace and Upstream Park in Shanghai will be the company's major projects for this year.
The developer yesterday reported its underlying profit jumped 236 per cent to HK$4.13 billion last year. Attributable revenue soared 269 per cent to a record HK$11.84 billion.
Hui said the strong results were due to robust property sales.
The company declared a final dividend of 10 HK cents per share, compared with 8 HK cents a year earlier.
Shares in KWah advanced 3.19 per cent to close at HK$4.20 yesterday.