China property developer Yanlord Land reported on Wednesday its fourth quarter net profit fell 78 percent on-year to 256.90 million yuan (S$51.82 million or US$38.45 million) as it delivered less gross floor area under its delivery schedule.
The average selling price per square meter was also lower in the quarter due to a change in product mix, Yanlord said.
Revenue for the quarter ended 31 December dropped 79 percent on-year to 2.33 billion yuan, the property developer said in a filing to SGX after the market close on Wednesday.
Finance costs for the quarter surged 476 percent on-year to 215.64 million yuan, mainly on increased interest expenses on completed properties for sale and for financing investments in joint ventures, Yanlord said.
For the full year, it reported net profit rose 10 percent on-year to 3.54 billion yuan on revenue of 24.89 billion yuan, down 3 percent on-year. That was due to a lower average selling price being offset by an increase in the gross floor area delivered to customers during the year, Yanlord said.
“The group continues to see healthy pre-sale accumulation on the back of sustained market demand for high-quality residential developments,” Yanlord said.
As of end-December, the accumulated pre-sales pending recognition were at 12.88 billion yuan, which will be progressively recognized as revenue ahead.
Yanlord proposed a final divided of 6.80 Singapore cents, unchanged from a year earlier.
Zhong Sheng Jian, Yanlord’s chairman and CEO, was optimistic in his outlook.
“The PRC real estate sector continues to exhibit long term growth potential underpinned by strong demand arising from stable development of the PRC economy. While changes and uncertainties in the market continue to weigh on the PRC real estate sector, we nonetheless remain confident about the long-term development of the sector,” Zhong said.
“To better manage volatilities arising from austerity measures introduced, we strategically managed our launch schedules and inventory levels to better capture market opportunities to enhance returns,” he added.