- In a statement to the Shenzhen Stock Exchange, China Vanke (000002.SZ/2202.HK) has posted a 16.54% decrease in net profit for the first quarter of 2017 to RMB 695.41 million.
- The company recorded a 27.22% increase in revenue to RMB 18.59 billion.
- EPS for the first quarter was RMB 0.063.
Why It Matters:
- China Vanke’s real estate sales for the first quarter increased 99.7% year-over-year to RMB 150.27 billion. The company thinks that the drop in net profit for the first quarter was due to an increase in operating costs. Specifically, marketing expenses increased 38.8%, administrative expenses increased 29.3%, and financial expenses and interest costs also increased in the first quarter.
- Despite the profit drop in the first quarter, Vanke believes that it will post an increase in net profit for the year 2017.
- China Vanke has been the focus of a fight for control of the company between several parties in 2016. As shown in the first quarter earnings report, the Shenzhen Metro Group is currently the largest shareholder of Vanke, owning a 15.31% stake, or nearly 1.69 billion shares in the company.