Yanlord Land's Q2 net profit dives 99 per cent on lower sales, absence of one-off gains

Yanlord Land Group's second quarter net profit dived 99 per cent to 6.4 million yuan (S$1.3 million).

Revenue fell 49 per cent to 1.38 billion yuan for the three months to June 30.

The fall was mainly attributable to a decrease in gross floor area delivered during the quarter.

Gross profit margin decreased to 31.6 per cent from 34.9 per cent previously, mainly due to the change in composition mix of the properties delivered.

Aside from lower sales, the absence of fair value gain on investment property as well as net gain from available-for-sale investment had a significant impact on bottom-line in the quarter just ended.

In the same period last year, Yanlord reported fair value gain of 474.4 million yuan and net gain on disposal of available-for-sale investment of 129.9 million yuan.

Earnings per share sank to 0.33 fen from 37.75 fen previously while net asset value per share stood at 8.42 yuan, up from 8.38 yuan as at Dec 31.

Total pre-contracted sales grew by 20.6 per cent to 7.66 billion yuan and are expected to be progressively recognised as revenue in the subsequent quarters.

Given the continued challenges posed by volatilities in the global economy and pressures from austerity measures introduced by the Chinese central government, Yanlord believes that its prudent financial policies coupled with a strong cash position will serve to better drive its sustained development.