Mainland developer Agile Property Holdings has increased its interim dividend substantially, even as it reported declines in gross and net profit for the first half. The Hong Kong-listed company's gross profit fell 5.362 billion yuan (HK$6.5 billion) in the first six months, down 12.7 per cent over the same period of last year. This pushed down its gross profit margin 7.1 points to 45.3 per cent. Net profit dropped slightly, by 1 per cent, to 2.07 billion yuan. Agile's chairman Chen Zhou Lin said yesterday the interim results were "still acceptable". "There are two reasons for the decline [in gross profit]," he said. "Firstly, we sold fewer flats in Hainan - where properties yield higher gross profit margins - with only 154 million yuan of sales this year compared with 570 million yuan last year. "The second factor is that we lowered prices of some projects this year. But the fact is that a gross profit margin of 45.3 per cent is quite good, and it is similar to the levels in 2009 and 2010." He added that the company was confident of meeting its full-year sales target. It declared an interim dividend of 14.5 HK cents, up 34.3 per cent. Chen said the payout was in line with the company's strategy and that its cash and bank balances totalled 12.131 billion yuan at the end of June. Vice-president Alex Liu said that as of mid-August, its contract sales for the year hit 17.4 billion. This involved a total area of 1.8 million square metres, or 58 per cent of its full-year target. Agile will launch nine projects in the second half. Liu said he believed prices had bottomed out. Agile's deputy general manager and company secretary Peggie Wai Ching-sum said the company's land bank yielded a total gross floor area of 31.73 million sq ft. She said the firm would prudently acquire sites and had been looking for opportunities in Yunnan, Guangzhou, Hainan and Huiyang. Wai said the company had spent 1.6 billion yuan on land in Chongqing, Wenchang, Xian and Zhengzhou in the first half. It still has room to buy more sites as it aimed to spend 3 to 5 billion yuan on acquisitions every year. Agile is upbeat about the outlook of the tourism property market. It said that 20 to 30 per cent of the company's income would come from the market, such as its current and planned projects in Hainan and Yunnan. A further 30 to 40 per cent would come from projects in Guangdong and the rest from developments in other provinces. Shares in Agile rose 2.67 per cent to close at HK$8.86.