Aug. 26 (Bloomberg) -- Evergrande Real Estate Group Ltd., China’s biggest developer by sales volume, said first-half underlying profit rose 23 percent as it sold more properties.
Earnings excluding the revaluation of investment properties rose to 4.66 billion yuan ($761 million) compared with 3.78 billion yuan a year earlier, the company said in a Hong Kong stock exchange statement today. Revenue rose 13 percent to 42 billion yuan.
Evergrande’s earnings rose after the company raised prices in April and sold the most properties by area among Chinese developers in the first half, according to China Real Estate Information Corp., a property data and consulting firm. China will seek “stable and healthy” development of the market, the Communist Party’s Politburo said July 30, the first time this year that authorities didn’t mention further tightening of restrictions.
Evergrande’s contracted sales were 44.6 billion yuan in the first half from a year earlier, accounting for almost 45 percent of its target for the whole year, the developer said today. Chinese developers begin selling properties while they are under construction and book profits upon completion.
Evergrande’s net gearing, or the debt-to-equity ratio, fell to 58.4 percent, compared with 96.1 percent the same time last year, the developer said today.
The company said in January that it is seeking to place 1 billion shares at HK$4.35 each and it will use the HK$4.35 billion ($561 million) raised to repay debt and for working capital.
Evergrande’s stock was unchanged at HK$3.30 at the close of trading in Hong Kong today before the earnings were announced. It has fallen 22 percent this year.
To contact Bloomberg News staff for this story: Bonnie Cao in Shanghai at firstname.lastname@example.org
To contact the editor responsible for this story: Andreea Papuc at email@example.com