KWG revenue declines to 9.5b yuan

KWG Property, a Hong Kong-listed mainland developer, yesterday announced a 2.2 per cent fall in revenue last year to 9.5 billion yuan (HK$12 billion) as a lower average selling price drove down property development income by 3.8 per cent to 9 billion yuan.

Net profit rose 13 per cent in 2013 to 2.9 billion yuan, and earnings per share increased by 14.5 per cent to 95 cents. The company proposed a final dividend of 29 cents per ordinary share, it said in a statement.

Gross profit margin fell to 36.2 per cent last year from 36.5 per cent in 2012, putting the company in a situation similar to many industry peers including Country Garden and China Overseas Land & Investment. But its net profit margin increased to 29 per cent last year from 25.1 per cent in 2012.

"The group will endeavour to improve its cost control and financial systems, optimise its internal resources, upgrade the management standards of its hotel and investment properties and enhance operating efficiency in general," the developer said.

Its net gearing ratio fell to 56.3 per cent last year from 63.5 per cent in 2012, as the company refinanced its maturing debts at lower cost, including a US$300 million senior note and two offshore bank loans of 1 billion yuan and HK$2.7 billion yuan.

The company plans to launch new projects this year in Beijing, Shanghai, Hangzhou and Nanning, it said, without giving a target for contracted sales for this year.

After a spate of government measures, the mainland's property market has recently showed some signs of cooling down, with some developers cutting prices in Hangzhou and Changzhou. But analysts believe it is premature to predict a nationwide price war this year as strong demand is expected to drive up home prices in top cities such as Beijing and Shanghai.

The National Bureau of Statistics is scheduled to announce home prices in 70 major cities today.