China

China Vanke Posts 20.5% Increase in Net Profit for First Nine Months

Summary:

  • China Vanke (000002.SZ) has posted a 20.5% increase in net profit  for the first nine months to RMB 8.2 billion, as reported by Securities Times.
  • The company also posted a 47% increase in revenue to RMB 117 billion.
  • EPS was RMB 0.78 per share.

Why It Matters:

  • The Chinese real estate developer reported that total area sold during the period increased 38% to 19.9 million square meters, of which 15,000 square meters was in housing sales from its projects in overseas markets.
  • The gross margin during the first nine months was 17.92%, and the company expects this margin to rise further by the end of the year. China Vanke also said that it has signed RMB 306.4 billion worth of contracts with clients for future home sales and that construction is ongoing.
  • The ongoing control fight between the management team and the company’s largest shareholder has had a severe impact on the company. The employee turnover rate of the firm has risen, while credit rating firms now hold negative views on the prospects of China Vanke. Both S&P and Moody’s have downgraded their ratings of the prospects for the company to “Negative”.