Chinese property firm Vanke’s first-half profit rises 25 per cent as faster construction lifts sales
The company reports US$1.3 billion in net profit for the January to June period
China Vanke, the country’s second-largest property developer by sales, posted a 25 per cent rise in first-half profit on Monday, as a faster construction speed helped it sell more homes.
Net profit climbed to 9.1 billion yuan (US$1.3 billion) for the first six months of this year, while revenue rose 55 per cent to 105 billion yuan from the same period last year.
Vanke achieved 23.2 million square metres (249.7 million square feet) of new construction floor area, up 40 per cent from the first half of last year and accounting for 66 per cent of its planned construction for this year.
A number of Chinese developers have adopted a “build fast and sell fast” model this year in the face of government caps placed on the prices they can sell at, as well as increasing difficulty in getting funding because of government concerns over rising debt at property firms.
The country will firmly “contain home price gains”, China’s top political body, the Communist Party’s Politburo, stated in July.
As a result most developers expect that the going will get tough in the second half of this year and into 2019.
