Shui On Land expects the business environment for mid- and small-sized developers to be challenging this year as cooling measures in the mainland property market continue to have an impact.
'The business environment may be more difficult than that in 2011,' chairman Vincent Lo Hong-sui said yesterday.
Despite the People's Bank of China lowering banks' reserve ratio requirements twice, he believes the measures to loosen lending will not help the market unless there is a turnaround in the global economy.
'Mid- and small-sized developers will face pressure as the property market isn't active and they are finding it difficult to finance. But we have prepared sufficient funds for expenditure this year and are also planning to spin off our investment properties. If they are listed, it can shore up our capital,' he said.
The developer said its underlying profit, excluding property revaluation gains, surged 108 per cent to 1.57 billion yuan (HK$1.93 billion) in 2011.
Its turnover jumped 74 per cent to 8.48 billion yuan, while net profit rose 22 per cent to 3.43 billion yuan.
The growth in profit and turnover was driven by strong property sales, higher selling prices and increased sales volumes, said CEO Freddy Lee.