China Resources Land posts 11.7% profit increase, sees stability ahead for property sector thanks to policy support
- Revenue jumped 21 per cent in 2023 while net gearing and borrowing costs fell
- China’s troubled property market is on track for a gradual return to stability despite the many challenges it still faces, company says
China’s troubled property market is on track for a gradual return to stability despite the many challenges it still faces, China Resources Land said as it posted another profitable year in 2023, extending its streak through all crises since at least 1997.
Earnings at the nation’s fourth-largest developer rose 11.7 per cent to 31.4 billion yuan (US$4.4 billion) compared with 2022, according to a filing with the Hong Kong stock exchange on Tuesday.
“In 2024, although the property market will continue to face many challenges, with the implementation of supportive government policies to mitigate risks and city-specific measures, the confidence of enterprises and residents will gradually recover,” chairman Li Xin said in the results announcement. “The real estate industry will also gradually return to stable development and transition towards new development models.”
Li’s remark echoed comments by the People’s Bank of China that some “positive signals” have emerged from the country’s property market, which has a solid foundation for healthy and stable development in the long term.
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Shenzhen-based China Resources Land saw its revenue jump 21 per cent year on year to 251.1 billion yuan, driven mainly by growth in its property development business. That business, which accounted for 84 per cent of total revenue, grew 20.4 per cent year on year, while revenue from recurring businesses – chiefly investments and management – jumped 26.4 per cent.
The results come after the company posted the slowest annual sales growth since at least 2015 in January, as low homebuyer confidence and concerns about defaults dampened demand. The firm sold 307 billion yuan worth of homes last year, a 2 per cent annual increase.