SOHO China reports 45% drop in net income

By Cherry Cao | March 6, 2015, Friday |

Online Edition

SOHO China Ltd, a major office developer in China, reported today a drop of net income in 2014 as revenue declined.

Its net profit attributable to equity shareholders fell 45 percent year on year to 4.1 billion yuan (US$658 million) during the 12-month period on a 60 percent plunge in turnover to 6.1 billion yuan, the Beijing-based developer said in a filing to the Hong Kong stock exchange.

"As the company sticks to its shift from the 'build and sell' model to 'build and hold' model, we saw outstanding performance in the property leasing sector," said Pan Shiyi, chairman of SOHO China. "As leasable space continues to grow with the completion and delivery of more investment properties, rental income is expected to rise at a rapid speed.

Last year, SOHO China recorded an annual rental income of 424 million yuan, a year-on-year surge of 52 percent, according to the filing.

As of December 31, 2014, the total gross floor area of SOHO's completed investment properties reached 838,000 square meters. By 2018, the developer is expected to hold 1.8 million square meters of commercial properties, which mainly consist of office buildings in the prime locations of Beijing and Shanghai, the company said.

The company attributed its significant growth in its leasing business mainly to a self-established online leasing platform that improves efficiency, a strategic focus on domestic tenants, as well as a commitment to indoor environmental quality and sustainable growth.

The firm’s core net profit, excluding gains on investment properties, dropped 60 percent from 2013 to 1.78 billion yuan.

As of the end of 2014, SOHO China had 12.48 billion yuan in cash and bank deposits, it said.

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SOHO China reports 45% drop in net income

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