BEIJING • Dalian Wanda Group's revenue fell for the first time in at least 11 years after a slump in its property business outweighed growth from entertainment operations at billionaire Wang Jianlin's conglomerate.
Sales, which includes property-contracted sales, declined 14 per cent last year from a year earlier, according to a Wanda statement last Saturday, more than a January 2016 forecast of a 12 per cent drop.
Revenue at Dalian Wanda Commercial Properties, the group's real estate unit, declined 25 per cent to 143 billion yuan (S$29.6 billion).
Wanda's operating revenue rose 3.4 per cent to 255 billion yuan, while profit grew more than 10 per cent, it said, without giving specifics. China's second-richest man has been acquiring Hollywood assets - he bought film producer Legendary Entertainment last year - to help Wanda diversify away from its real estate roots.
Mr Wang, speaking to employees at Wanda's annual meeting in Hefei, the capital city of Anhui province in eastern China, said Ffan.com, a unit that includes Internet financing and credit-rating businesses, will raise 10 billion yuan via a private placement this year.
He ultimately plans to list the unit by year 2020 and target profit of more than 10 billion yuan.
Mr Wang delisted Dalian Wanda Commercial Properties last year in Hong Kong under a plan to eventually seek a listing in mainland China, where valuations tend to be higher. The company has been in takeover talks with several candidates to execute a backdoor listing, people familiar with the matter said in November.
Mr Wang has taken an "asset-light" strategy for his real estate business in recent years, reducing reliance on property sales and increasing his focus on leasing and management. The transition has resulted in sales volatility, but could improve the group's cash flow and earnings stability.
Wanda Cultural Industry Group, which includes most of its theme parks, film production and exhibition businesses, saw sales climb 25 per cent to 64.1 billion yuan last year. The increase also reflected income from newly acquired businesses, including Legendary Entertainment, which will continue to be the growth driver for Wanda.
Mr Wang, who plans to build a global movie distribution network, aims to achieve 10 billion yuan profit in its film business and 20 per cent market share in the global movie industry by the end of the decade.
BLOOMBERG
