China Evergrande and China Vanke report profit gains and high debt ratios during 2018
- Evergrande’s 2018 core profit jumped 93.3 per cent to 78.32 billion yuan (US$11.88 billion)
- China Vanke’s net profit surged 20.4 per cent to 33.77 billion yuan
Mainland property developers China Vanke and China Evergrande Group reported upbeat profit results for 2018, along with higher debt levels.
Evergrande, chaired by billionaire Hui Ka-yan, saw core profit jump 93.3 per cent to 78.32 billion yuan (US$11.88 billion) for the year, up 93.3 per cent on year, while revenue was 466.2 billion yuan, a rise of 49.9 per cent.
Contracted sales came to 551.34 billion yuan, up 10.1 per cent on year. For 2019 the company expects sales of 600 billion yuan.
The company said it would not pay a final dividend for 2018. In August the company paid a combined dividend of 1.13 yuan per share for operations in 2016 and 2017.
Evergrande’s net gearing ratio, a measure of equity to debt, hit 151.9 per cent at the end of 2018, up 24 percentage points from six months earlier, according to a company filing Tuesday to the Hong Kong stock exchange.
Vice-chairman and chief executive Xia Haijun pledged last year to cut the company’s net gearing ratio to 140 per cent by the end of 2018, and to 100 per cent by the end of 2019.
Chief financial officer Pan Darong said on Tuesday that the company’s investments in the electric car industry led to the higher net gearing ratio.
