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Sun Hung Kai (SHK) Properties Limited announced Thursday the group's interim results for 2003/04 and investment in big cities of the Chinese mainland.
SHK Chairman and Chief Executive Kwok Ping-sheung said at a press conference that the group will invest selectively in major cities such as Beijing, Shanghai, Guangzhou and Shenzhen in the future, as he predicted that new business and investment opportunities will keep emerging on the mainland.
With continued growth in the vibrant mainland economy, the group's businesses there performed satisfactorily during the period under review. Shanghai Central Plaza did well, achieving over 96 percent occupancy, and the pre-sale of Arcadia Shanghai Phase 2 was encouraging with virtually all units sold, said Kwok.
Kwok said the group's unaudited profit after tax and minority interests for the six months ending on Dec. 31 2003, was 2,840 million HK dollars, a decrease of 22 percent compared with 3,663 million HK dollars for the same period a year before.
He said the decline in earnings was due mainly to project timing, which resulted in fewer residential developments being completed during the period under review. Earnings per share were 1.18 HK dollars, representing a 23 percent decline compared with 1.53 HK dollars for the corresponding period a year before.
According to Kwok, the residential property market has made a significant recovery since July last year, due mainly to better confidence and an economic recovery amid the Central Government's positive measures and local government efforts.
He said continued buoyancy in equity prices also contributed to market momentum, particularly in the luxury property sector. The profile of home-buyers is now more diverse with the majority being genuine end-users, including more up-graders.
Looking into the future, Kwok believed that due to record low mortgage interests and the fact that it is more economical for people to buy than to rent, demand for residential property should remain firm.
Also, new supply of residential property is expected to decline in the coming years and increasing demand suggests that residential property prices should rise over the medium term. The group will be responsive to these trends and aim to enhance development profit margins and returns to shareholders, said Kwok.
(Xinhua News Agency March 12, 2004)
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