Sino Land's core earnings decline 24pc for year
Developer's underlying profit slumps 24pc for the year, hurt by lack of completed projects, but chairman notes a pickup in primary market
Sino Land said yesterday its underlying profit slid 24.3 per cent to HK$5.02 billion for the year to June as the lack of completed new projects weighed on its results.
Chairman Robert Ng Chee Siong said changes to the double stamp duty passed in July have helped improve buying sentiment as more projects were launched for sale in the market. Shares in Sino Land fell 0.72 per cent to close at HK$13.84 yesterday.
"The primary transaction volume has recently recovered, but with rising construction costs and the property-related policies, there remain sensitivities in the property market," Ng said. "Management will closely monitor the situation and will be responsive to market changes." Sino Land is one of the biggest property companies in Hong Kong.
With the inclusion of investment property revaluation gains, net profit was HK$8.92 billion, down 23.66 per cent from HK$11.69 billion a year earlier. The result is better than market expectations of about HK$6.83 billion and analysts expect further improvement in the coming year following the rebound in property sales. Turnover fell to HK$7.45 billion from HK$7.82 billion.
Kenny Tang Sing-hing, a general manager at AMTD Financial Planning, said: "The overall results of Hong Kong developers released recently are better than market expectations. It is because property sales remain strong under the cooling measures."
He believes developers' results will improve further.
Sino Land generated a turnover of HK$4.64 billion from property sales for the 12 months to June, 67 per cent less than the HK$14.13 billion in the previous year.
The main contributors are sales of the Avery, a single-block development in Ma Tau Kok, and two residential projects in Xiamen and Zhangzhou on the mainland.
Its gross rental income grew 8.3 per cent to HK$3.45 billion due to higher rental rates on renewals.
A final dividend of 38 HK cents per share was declared, bringing the full-year payout to 50 HK cents, the same as last year.
Meanwhile, Sino Hotels (Holdings), another listed company of the parent Sino Group, said its net profit dropped 2.62 per cent to HK$234.5 million for the year to June.
The average occupancy rates of its three hotels ranged between 83.5 per cent and 94.5 per cent.
The company said the supply of hotel rooms in Hong Kong is on the rise and travellers have been more conscious about their spending.
Sino Land's holding company, Tsim Sha Tsui Properties, said its underlying profit dropped 34.83 per cent to HK$2.54 billion during the same period.