24 Apr 2014 10:30
24th April, 2014
Pacific Alliance China Land Limited
Pacific Alliance China Land Limited (AIM: PACL) announces that as at the close of business on 31 March 2014, its unaudited net asset value ("NAV") per share was US$2.2918.
The NAV decrease of 5.35% this month was largely due to Project Auspice. The project's NAV fell by 27% quarter-on-quarter, which was largely attributed to the severe drop in the P/E multiples of the listed comparables from November 2013 to February 2014, coupled with a lower net profit against the forecast. It's worthwhile to note that Auspice still achieved double digit revenue and profit growth in 2013. However, as the broader market focuses on residential, it does not recognize a company with a majority of its revenue coming from its commercial property activities. The Manager continues to believe that Auspice is one of the best property companies in China as demonstrated by revenue and profit growth averaging 64% and 44% respectively per year over the last five years.
Project Malls dropped by 3.7%, similar to the situation of Project Auspice, this is resulted from a drop in the P/E multiples of the listed comparables.
The drop in the NAV of Project Auspice and Project Malls were partially offset by the reduction in the tax provisions as a result of the valuation drop.