Country Garden’s Yang Huiyan has a bit less to smile about after these latest financials
One of China’s biggest outbound real estate developers blames a six percent drop in gross margin on forex challenges, Hugo Boss is suddenly finding China less fashionable, and a high end site in Hong Kong sells at 27 percent below the forecast auction price. Amidst all the gloom, however, one of the largest mainland REITs raises distributions. Read on for more details.
Country Garden Shares Pounded After Profits Slip in 2015
Country Garden Holdings Co. shares declined by the most in two years, after the developer reported declining margins in 2015 and losses from foreign exchange movements.
Shares of Country Garden dropped 9.1 percent to HK$3.20 in Hong Kong, the largest decrease since March 2014. Gross profit margin, a measure of profitability, declined 5.9 percentage points to 20.2 percent last year, according to data compiled by Bloomberg. That missed the average estimate of 23.7 percent by eight analysts surveyed by Bloomberg. Read more>>
Hugo Boss to Close 20 China Stores As Market Refuses to Cooperate
German fashion house Hugo Boss has announced to close around 20 stores in the China market amid “the difficult market situation”.
The company said earnings fell slightly short of expectations and currency-adjusted sales declined due to the falling of sales in China and the US.
In the Americas, fourth-quarter sales dipped 1% below the prior year’s level in local currencies, while double-digit sales decreases in China led to a currency-adjusted decline of 7% in Asia/Pacific in the fourth quarter. Read more>>
Stanley Site Sells for 27% Below Forecasts
A luxury residential site in Stanley sold on Tuesday for a surprisingly low HK$2.81 billion, a strong indication of developers’ extreme caution regarding the high-end sector which is traditionally considered more resilient in a market downturn.
The sale price was 27 per cent below the low end of the HK$3.8 billion to HK$5.43 billion range forecast by surveyors. Read more>>
Hui Xian REIT Raises Distributions Despite Downturn
Hui Xian Real Estate Investment Trust, the first yuan-denominated reit listed in Hong Kong, said on Tuesday that its amount available for distribution rose 8.4 per cent last year despite the weak growth in the mainland Chinese economy and the ongoing global slowdown.
The reit said the amount available for distribution grew to 1.48 billion yuan from 1.36 billion yuan a year ago, with 98 per cent to be distributed to unit holders. Distribution per unit for the second half of the year was about 13.4 fen. Read more>>
China Struggles With Two-Tier Housing Market
China is having a harder time managing a property market that is diverging, the country’s housing minister said Tuesday.
“The differences are severe, and it is worsening,” Chen Zhenggao said at a news conference on the sidelines of the National People’s Congress on Tuesday. “The situation in the first-tier cities and the third- and fourth-tier cities are different, which brings about challenges to our regulatory work, and is a major issue.” Read more>>
Shenzhen Housing Boom Making Hong Kong Look Affordable to Mainlanders
Steeper discounts and an array of tax incentives being offered by developers have drawn mainland buyers back to Hong Kong’s western New Territories, as the price premium of Hong Kong over Shenzhen continues to narrow.
Flooded with new supply, new home prices in Yuen Long fell as much as 6 per cent in the past two weeks, which in turn negatively affected the secondary residential market. Read more>>
Tune in again tomorrow for more news, and be sure to follow @Mingtiandi on Twitter for headlines as they happen.
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