New World China core profit rises 64pc, eyes conservative sales next year
After posting 64 per cent jump in core profit, developer sees mainland market performing steadily next year with sales of 17 billion yuan
New World China Land, a mainland property unit of New World Development, is looking at a "conservative" property sales target next year after reporting a 64 per cent increase in core profit for the year to June 30.
The developer, one of the first in Hong Kong to venture into the mainland market, projected a sales target of 17 billion yuan next year. In the financial year to June, it secured contract sales of 16.53 billion yuan.
The company announced core profit excluding property revaluation gains amounted to HK$3.33 billion, from HK$2.03 billion in the preceding year. Bottom line profit, including property revaluation gains, rose 49.83 per cent to HK$4.62 billion, compared to HK$3.08 billion in the previous financial year.
There is a huge potential in the markets of the second- and third-tier cities
It announced a final dividend of four HK cents per share, bringing the full-year dividend for the year to seven HK cents a share.
"We believe the market will perform steadily next year," said New World China's executive director and company secretary Lynda Ngan Man-ying.
The company does not expect the central government to introduce tougher measures to curb home prices amid an economic slowdown.
New World China next year expects to sell more homes in the second-, third- and fourth-tier cities, where prices are cheaper than in first-tier cities. Gross profit margins are expected to drop to 35 to 40 per cent in view of the company's plan to sell cheaper homes in lower-tier cities.