Guangzhou R&F Properties has cut its contracted sales target by 10 billion yuan (HK$12.57 billion) this year on signs of slowing sales.
The developer yesterday announced its net profit climbed 8 per cent year on year to 1.58 billion yuan in the first half but turnover fell 4 per cent to 9.82 billion as property sales took a hit in China.
Profit from property development, which constitutes around half of its net profit, plunged 37 per cent to around 788 million yuan. In contrast, profit from property investment jumped 135 per cent to 1.08 billion yuan.
Net loss from the hotel operation increased 33 per cent to 148 million yuan.
No interim dividend will be paid.
Chairman Li Sze-lim said the company will sell 60 projects in 22 cities across the country, including 19 new ones.
R&F has generated 25.8 billion yuan from contracted sales in the first half, 39 per cent more than in the same period last year. But it represents 36.86 per cent of its full-year sales target of 70 billion yuan.
“We are cautiously optimistic that the fundamentals of the market will remain intact. However, the current state of the market justifies the decision to carry out a conservative and realistic review of our business plan. The group’s contracted sales target for the year has thus been revised to 60 billion yuan,” he said.