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Shui On Land

Shui On profit rises 27 per cent on mainland China rebound

PUBLISHED : Wednesday, 28 August, 2013, 12:00am
UPDATED : Wednesday, 28 August, 2013, 5:44am

Property developer Shui On Land yesterday announced a 27 per cent rise in net profit for the first half of the year and said it expected the outlook to improve in the mainland's residential and commercial markets.

The company, chaired by Vincent Lo Hong-shui, said net profit was 1.05 billion yuan (HK$1.32 billion), up from 825 million yuan in the first half of last year.

Core earnings stood at 387 million yuan, up from 15 million yuan in the first half of 2012.

Lo said the mainland's residential property market had staged a strong rebound despite the economic slowdown and market-cooling measures introduced by the government.

Turnover increased 121 per cent to 3.62 billion yuan from more properties being delivered while rental and related income rose by 25 per cent.

"The continuation of the present market momentum could lead to government market-cooling measures in the second half," Lo said. "However, this risk is mitigated by the slowing pace of economic growth.

"Despite a generally tighter credit environment in the second half and the rising probability of market dampening measures such as the implementation of property taxes in more cities, housing transactions this year are expected to outperform last year's level."

Lo said he also saw a positive outlook for the commercial property sector, supported by a growing middle class.

Contracted sales for the first half of 2013 increased by 315 per cent to 6.4 billion yuan. As of June 30, total locked-in sales for delivery in the second half of the year and beyond was 9.11 billion yuan.

An interim dividend of 2.2 HK cents per share was announced, down from 2.5 HK cents.