Jan 29, 2016
Hang Lung Properties full-year profit plunges, chairman sees no bottom
Jan 29, 2016
Hang Lung Properties Ltd's full-year profit plunged almost 57 percent and although it beat analyst estimates, its chairman warned China's real estate market could slow further and he expects no short-term improvement.
Hang Lung reported a net profit of HK$5.09 billion ($653.4 million) in the year ended Dec. 31, compared with HK$11.7 billion in the same period the previous year.
Analysts had forecast a profit of HK$4.687 billion according to Thomson Reuters StarMine Smart Estimates, which is a weighted average based on the most accurate analysts.
"I don't know when there will be a bottom to China's economic weakness," Chairman Ronnie Chan told reporters. "No one knows how long it will take for the mainland market to recover."
But while Chan called the mainland market "extremely weak", he also said it was a good long-term investment and there are no other countries in the world that can maintain a greater-than 6 pct GDP growth in the coming years.
Hang Lung's revenue fell to HK$8.95 billion from HK$17.03 billion.
The major fall-off was in property sales, where revenue fell 88 percent from the previous year. Just 63 apartments and some car parking spaces were sold in 2015.
The company said in a statement that it expected the market correction in mainland China and Hong Kong to continue into 2016 and that it was seeing an impact in the retail sector.
As of Thursday's close, shares of the company have fallen 17.8 percent so far this year compared with a 16 percent slide in the Hang Seng property sub-index
$1 = 7.7902 Hong Kong dollars
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