China Vanke Co (萬科) chairman and chief executive officer would both resign in an abrupt move after the embattled developer warned of a record 45 billion yuan (US$6.2 billion) loss for last year.
Chairman Yu Liang (郁亮) applied to resign due to “work adjustment reasons,” but would remain as a director of the company, Vanke said in a filing to the Hong Kong stock exchange yesterday.
Chief executive officer Zhu Jiusheng (祝九勝) is also stepping down, citing “health reasons.” He would no longer hold any positions at the company.
Photo: Reuters
Shenzhen Metro Group Co (深圳市地鐵集團) chairman Xin Jie (辛杰) would replace Yu. The state-owned subway operator is Vanke’s largest shareholder.
The developments underscore the sense of alarm at the Shenzhen-based developer, which has taken center stage in China’s prolonged property slump after dozens of its peers defaulted.
Vanke risks a similar fate as it faces a wall of debt repayments at a time when losses are widening and home sales continue to tank.
The preliminary net loss is the developer’s first on an annual basis since its 1991 listing and more than doubles analysts’ projections for a loss of 21.8 billion yuan, data compiled by Bloomberg showed.
The full-year amount includes a 17.9 billion yuan loss in the first nine months of last year, suggesting operations worsened significantly during the final quarter even as the government unveiled its biggest package to revive the housing market.
Before joining Vanke, Zhu spent 19 years at state lender China Construction Bank Corp’s (中國建設銀行) Shenzhen branch. With a doctoral degree in economics, Zhu joined the developer in 2012, first as a senior vice president and later overseeing finance operations. He spearheaded new businesses including China’s first public real estate investment trust, underpinned by Vanke’s office buildings.
In 2018, he took over the president and chief executive officer roles from Yu, who shifted his focus to Vanke’s long-term strategy. In a media briefing that year, Yu described Zhu as a bookworm and outspoken within the company.
A graduate of Peking University, Yu joined Vanke in 1990, two years after the developer began to transform itself from a trading firm into a real estate juggernaut.
After overseeing the company’s stock listing and investments in his early years, Yu worked as the general manager for 16 years. In 2017, he took the presidency role from founder Wang Shi (王石) after an ownership tussle that ended with a state entity becoming its biggest investor.
In later years, Yu dominated Vanke’s diversification into non-traditional businesses, including rental apartments and logistics, as China’s urbanization entered its later stage.
The company was forced to exit non-core operations and divest assets last year as the property downturn dragged on.
Just like his predecessor, Yu has climbed Mount Everest and run marathons, local media has reported.
Japanese technology giant Softbank Group Corp said Tuesday it has sold its stake in Nvidia Corp, raising US$5.8 billion to pour into other investments. It also reported its profit nearly tripled in the first half of this fiscal year from a year earlier. Tokyo-based Softbank said it sold the stake in Silicon Vally-based Nvidia last month, a move that reflects its shift in focus to OpenAI, owner of the artificial intelligence (AI) chatbot ChatGPT. Softbank reported its profit in the April-to-September period soared to about 2.5 trillion yen (about US$13 billion). Its sales for the six month period rose 7.7 percent year-on-year
CRESTING WAVE: Companies are still buying in, but the shivers in the market could be the first signs that the AI wave has peaked and the collapse is upon the world Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported a new monthly record of NT$367.47 billion (US$11.85 billion) in consolidated sales for last month thanks to global demand for artificial intelligence (AI) applications. Last month’s figure represented 16.9 percent annual growth, the slowest pace since February last year. On a monthly basis, sales rose 11 percent. Cumulative sales in the first 10 months of the year grew 33.8 percent year-on-year to NT$3.13 trillion, a record for the same period in the company’s history. However, the slowing growth in monthly sales last month highlights uncertainty over the sustainability of the AI boom even as
AI BOOST: Next year, the cloud and networking product business is expected to remain a key revenue pillar for the company, Hon Hai chairman Young Liu said Manufacturing giant Hon Hai Precision Industry Co (鴻海精密) yesterday posted its best third-quarter profit in the company’s history, backed by strong demand for artificial intelligence (AI) servers. Net profit expanded 17 percent annually to NT$57.67 billion (US$1.86 billion) from NT$44.36 billion, the company said. On a quarterly basis, net profit soared 30 percent from NT$44.36 billion, it said. Hon Hai, which is Apple Inc’s primary iPhone assembler and makes servers powered by Nvidia Corp’s AI accelerators, said earnings per share expanded to NT$4.15 from NT$3.55 a year earlier and NT$3.19 in the second quarter. Gross margin improved to 6.35 percent,
FAULTs BELOW: Asia is particularly susceptible to anything unfortunate happening to the AI industry, with tech companies hugely responsible for its market strength The sudden slump in Asia’s technology shares last week has jolted investors, serving as a stark reminder that the world-beating rally in artificial intelligence (AI) and semiconductor stocks might be nearing a short-term crest. The region’s sharpest decline since April — triggered by a tech-led sell-off on Wall Street — has refocused attention on cracks beneath the surface: the rally’s narrow breadth, heavy reliance on retail traders, and growing uncertainty around the timing of US Federal Reserve interest-rate cuts. Last week’s “sell-off is a reminder that Asia’s market structure is just more vulnerable,” Saxo Markets chief investment strategist Charu Chanana said in
RSS