News

New World China Land Limited (NWCL) today announced a net profit of HK$96.1 million for the six months ended 31 December, 2000, a rise of 14.6% over last year. Earnings per share were 6.6 cents. 
The Group's attributable operating profit (AOP) increased by 11.9% to HK$161.3 million from HK$144.2 million. Contributions from the Group's conventional property projects rose significantly due to increased rental income resulting from the completion and operation of the shopping arcades in Beijing and Tianjin, and increased sales income from Beijing New World Centre Phase I and New World Riverside Villa in Guangzhou. 
Community housing projects recorded a 124% growth in AOP for the period under review with the completion and sale of community projects in Beijing, Shenyang and Dongguan. 
"Revenue from property sales is set to increase in the second half, as 10 projects with a GFA of 643,944 sq.m. are due for completion, compared to 4 projects with a GFA of 141,670 sq.m. completed in the first half," said the NWCL chairman Dr Henry Cheng. 
Contributions from low-cost community housing projects dropped since less units were completed in the period. Scheduled for completion in the second half of FY2001, Wuhan Changqing Garden's Phase III and part of Phase IV, with a GFA of 279,404 sq.m. and 122,343 sq.m. respectively, will help boost profit contribution from this market segment. 
The Group land bank stands at 22,775,633 sq.m. 
NWCL's gearing has dropped to 19.1% from last year's 19.6%. Cash and bank balances rose from HK$578.3 million to HK$794.9 million resulting from increased property sales. 

Future Outlook 
"China has planned to increase government spending by 9.3 % to 1.74 trillion renminbi to stimulate domestic demand and keep annual economic growth at 7 % in 2001. It will also increase salaries of government workers for 30% by end of 2001. Increased government spending and mortgage relaxation are stimulating demand for quality housing in China. It is our strategy to expedite our development programme to take advantage of the growing demand in the mass residential market," noted Dr Cheng. 
With China's imminent WTO accession, the influx of foreign enterprises should stimulate demand for high-grade office facilities, villas, service apartments and hotels together with demand for residential units, said Dr Cheng. 
"The Group will strive to capitalise on these opportunities by enhancing our investment property portfolio of multi-purpose commercial complex and developing high-end properties selectively," he said.