China Vanke Expects to Post Losses in First Half
By P.R. Venkat
China Vanke expects to report a loss in the first half as the ongoing crisis in the country's real-estate sector continues to weigh on developers.
China Vanke said late Tuesday that it expects its loss to range between CNY7.0 billion and CNY9.0 billion ($962.5 million and $1.24 billion).
The property developer posted a net profit of CNY9.87 billion during the same period last year.
China's property sector has been in a yearslong slump. A slowing economy and weak consumer sentiment have weighed on the sales of many property developers, who are facing a liquidity crisis. The inability to tap debt markets has caused many developers to default on loans and bond payments, with some going bankrupt.
Vanke is one of China's few major developers yet to default in the country's ongoing property crisis. The company has said it intends to reduce interest-bearing debt by around $14 billion, from around $44 billion, by the end of 2025.
State-linked Vanke said impairment provisions, financial losses, and high project costs would also affect its first-half results.
"At the same time, in order to ensure the safety of cash flows, the company increased inventory destocking and asset disposal through price discounts, which led to further pressure on the company's results," Vanke said.
Write to P.R. Venkat at venkat.pr@wsj.com
(END) Dow Jones Newswires
July 09, 2024 20:00 ET (00:00 GMT)
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