HONG KONG: The coronavirus pandemic is hitting the cashflow of China Vanke, thanks to a drop of 51 billion yuan (US$7.3bil) in sales in February and March from a year ago, the nation’s second largest property developer by sales said yesterday.
Official data show property investment in China fell at its fastest pace on record in the first two months of the year, as home sales, construction and other economic activity all nosedived because of the virus.
The developer said it faced pressure to deliver 10,000 units to home buyers in the first quarter after a halt in construction this year, but it expects 90% of work to be resumed by the end of March, up from 80% now.
“We hope to catch up on sales in the later days; the previously suppressed purchase demand will be released (into the market), but at what speed is still uncertain, ” president and chief executive Zhu Jiusheng told an analyst conference.
Vanke has reported February sales of 28 billion yuan, or a drop of 15.2 billion yuan from a year ago, suggesting that the March decline could be as much as 36 billion yuan.
On Tuesday, the firm reported core profit of 38.3 billion yuan in 2019, up 14.4% from a year ago. It cut its dividend payout ratio to around 30% from 35% in 2018.
Shares of Vanke dropped as much as 6% in Hong Kong yesterday. — Reuters