New World China Land, New World Development's mainland property arm, is aiming to increase its completion area by 20 per cent for the financial year to June. The developer has completed 11 projects with a total gross floor area of 920,735 square metres for the year just ended. For this financial year, it plans to complete 14 projects with a total gross floor area of 1.1 million square metres. Executive director Adrian Cheng Chi-kong yesterday said the company had launched several projects with a total gross floor area of 350,000 square metres since July. About 47 per cent, or 164,500 square metres, has been sold. If inventory sales are included, its contract sales reached a total gross floor area of 200,000 square metres, which will be booked in the current financial year. But the company has made a provision of HK$54 million for its project in Shenzhen after property prices in the city dropped sharply. Despite a price war in cities on the mainland, Mr Cheng said the firm had not cut prices at its projects except in Chengdu, which was hit by an earthquake in May. He said the company was revising its contract sales target this year. New World China yesterday said annual net profit jumped 69.5 per cent to HK$2.02 billion from HK$1.19 billion in the previous year. Turnover rose 42.4 per cent to HK$3.52 billion from HK$2.47 billion. The company generated an operating profit of HK$1.39 billion from property sales during the period, up 60 per cent. The average gross profit margin reached 33 per cent, but the average property price dropped 11 per cent to 7,016 yuan (HK$7,978) per square metre. Profit from rental operations rose 25 per cent to HK$432 million. But New World China recorded a loss of HK$22.7 million in its hotel operations, compared with a profit of HK$13.93 million previously. The company is proposing a final dividend of 2 HK cents per share, down from 6 HK cents a year ago. Patrick Chow Kin-sung, an analyst at Everbright Securities, said the developer's underlying profit, excluding its property revaluation gain and net foreign exchange gains, was about HK$1.5 billion, meeting his expectations. Mr Chow said New World China would have to follow the example of other developers and cut prices at its mainland projects to increase property sales. New World China shares ended 8.22 per cent higher at HK$1.58 yesterday. Solid growth The profit jump of New World China Land from last year: 70%
