LINE

    Text:AAAPrint
    Economy

    Vanke shares decline on upped impairment buffer

    1
    2017-03-28 09:30China Daily Editor: Li Yan ECNS App Download
    Potential homebuyers visit a housing project developed by China Vanke Co in Jilin, a city in northeastern Jilin province. (Photo/Xinhua)

    Potential homebuyers visit a housing project developed by China Vanke Co in Jilin, a city in northeastern Jilin province. (Photo/Xinhua)

    Company states asset provision is prudent strategy

    Leading residential property developer China Vanke Co has lowered its outlook on the real estate market in 12 cities, due to concerns regarding the booming market.

    Financial results released on Sunday showed Vanke's asset impairment provision for projects last year amounted to 1.38 billion yuan ($200.9 million), a year-on-year increase of 82.3 percent, in response to constant fluctuations in housing and land prices in some cities.

    On the heels of the annual report, Vanke's stock prices declined by 1.35 percent and 4.63 percent on the Shenzhen and Hong Kong stock exchanges, respectively, on Monday.

    In 2016, housing sales across the country reached a record high. But, there are worries behind all this prosperity, Zhu Xu, Vanke's board secretary, told a media conference on Monday. Her comments followed the company's 2016 results release the day before.

    The move to expand its asset impairment provision covers 13 projects in 12 cities, including two second-tier cities and the remaining in third- and fourth-tier cities.

    Sun Jia, executive vice-president and chief financial officer of Vanke, noted the projected loss of some risk items is based on the company's prudent financial strategy. The new impairment provision this year totaled about 840 million yuan.

    The company announced on Sunday that its 2016 revenue amounted to 240.4 billion yuan, up by 23 percent over the previous year. Its profit attributable to equity shareholders rose by 16 percent to 21 billion yuan.

    Vanke remains one of the largest companies in its sector, as it realized a total sales area of 27.65 million square meters, amounting to 364.77 billion yuan, last year.

    The growth in impairment provisions is a prudent financial measure and in itself does not imply that the company is adopting a pessimistic attitude over the market, said Yan Yuejin, research director with E-house China R&D Institute.

    But, Yan admitted home purchase restrictions will require property companies to adjust related projects. In other words, the pressure to achieve their sales targets has intensified.

    Since the end of February, approximately a dozen cities-including Beijing and Shanghai as well as several second- and third-tier cities-unveiled tighter measures to restrict housing purchases and cool the property market, in response to escalating housing prices in those areas.

    In addition to the turbulent environment, Vanke remains troubled by a shareholding issue that began in 2015.

    Zhu Xu said the company is finalizing a plan to reelect its board of directors. The current board will continue to fulfill its duties in the meantime, even after its term expires on March 28.

      

    Related news

    MorePhoto

    Most popular in 24h

    MoreTop news

    MoreVideo

    News
    Politics
    Business
    Society
    Culture
    Military
    Sci-tech
    Entertainment
    Sports
    Odd
    Features
    Biz
    Economy
    Travel
    Travel News
    Travel Types
    Events
    Food
    Hotel
    Bar & Club
    Architecture
    Gallery
    Photo
    CNS Photo
    Video
    Video
    Learning Chinese
    Learn About China
    Social Chinese
    Business Chinese
    Buzz Words
    Bilingual
    Resources
    ECNS Wire
    Special Coverage
    Infographics
    Voices
    LINE
    Back to top Links | About Us | Jobs | Contact Us | Privacy Policy
    Copyright ©1999-2018 Chinanews.com. All rights reserved.
    Reproduction in whole or in part without permission is prohibited.
    主站蜘蛛池模板: 武胜县| 日照市| 巴中市| 肃北| 景洪市| 枝江市| 收藏| 新平| 武隆县| 乳源| 颍上县| 东源县| 化德县| 临邑县| 宜兰市| 浮山县| 嘉义市| 布拖县| 大石桥市| 鞍山市| 诸暨市| 阳城县| 鄂托克旗| 新源县| 剑河县| 新沂市| 南投市| 吉水县| 呼玛县| 湄潭县| 铅山县| 清水县| 百色市| 乌鲁木齐市| 光山县| 黄龙县| 富阳市| 县级市| 大化| 高阳县| 天长市|