Shares of Country Garden Service are slumping more than 10% in Hong Kong, after issuing profit warning.
Country Garden Services said that its net profit and net profit attributable to shareholders for the 12 months ending on Dec 31, 2022, are expected to decline by about 45% – 51% and 51% – 57%, respectively, compared to the same period in 2021.
Its core net profit attributable to shareholders is expected to grow by more than 5% and unaudited comprehensive income is expected to grow by more than 40% year over year for the 12 months ending on Dec 31, 2022, it said.
UBS said in a research note that the expected 51% – 57% drop in net profit attributable to shareholders is significantly weaker than the 11% rise expected by the bank and the market consensus.
It’s mainly due to rising expenditure and business disruptions caused by Covid control measures and impairment of goodwill and intangible assets resulting from mergers and acquisitions, UBS said.
The sell-off in Country Garden Services’ shares is also dragging down the shares of other property management companies, with Xingye Wulian and CIFI Ever Sunshine Services both falling more than 7%, while Times Neighborhood, Sunac China and KWG Living down more than 6%, S-Enjoy Service and Shimao Services down over 5%.
