Culled from Bloomberg News
China’s biggest property developer by sales is predicting more pain for the real estate industry after posting a record drop in first-half profit.
“The home market hasn’t entirely bottomed out, and the sector’s consolidation isn’t over,” Country Garden Holdings Co. Chief Financial Officer Wu Bijun said at an earnings briefing on Tuesday afternoon. “Property sales nationwide still haven’t stabilized.”
China’s developers are grappling with a yearlong sales slump, as homebuyer confidence evaporates during a liquidity crunch that’s stalled projects and triggered a wave of debt defaults.
Country Garden’s net profit slumped 96% to 612 million yuan ($88 million) in the six months ended June, the Foshan-based company said. That was the sharpest decline since its 2007 listing in Hong Kong.
Wu said that while a trough of corporate profit has “started to emerge,” the developer’s income statement will remain under pressure in the near future. “No one had envisioned such a cold market environment earlier,” she said.
Speaking at the same online briefing, President Mo Bin said the housing market is likely to return to normal by June next year.