China's Fosun posts record first half profit on growth across core businesses
today Aug 29, 2018
Chinese conglomerate Fosun International Ltd on Tuesday posted a 17 percent rise in January-June net profit, setting a first-half record due to growth in its core businesses.
Fosun, whose portfolio includes Club Med and a stake in Cirque du Soleil, said profit reached 6.86 billion yuan (£781.2 million), from 5.86 billion yuan a year earlier.
Revenue increased 20 percent to 43.51 billion yuan (5.46 billion euros).
Co-founded by Chinese billionaire Guo Guangchang, Fosun has been one of the country's most acquisitive overseas dealmakers, of which many of the most recent are in the fashion industry: Austria's Wolford and France's Lanvin. The group confirmed the appointment of Jean-Philippe Hecquet as the label's new CEO on the publication of the group's results. However, the group gave no information on the development of Lanvin's financial situation since the acquisition in spring this year.
Like peers such as Dalian Wanda Group Co Ltd and HNA Group Co Ltd, Fosun has faced increased scrutiny for its debt-fuelled, big-ticket foreign deals and is now pursuing a development path more closely aligned with government priorities.
In April, Fosun launched its Atlantis Sanya luxury resort in Hainan in line with a government desire to boost tourism in the southern province, already popular among Chinese holidaymakers.
The group has also moved to strengthen its balance sheet, reduce net debt, and balance acquisitions with asset sales.
As at the end of June, Fosun's debt stood at 162.47 billion yuan, versus 150.46 billion yuan at the end of December, due mainly to borrowing to fund expansion at various business units.
The group's mid-to-long-term debt accounted for 55.7 percent of total debt at June-end, versus 61.4 percent six months prior.
Shares of Fosun, which has a market value of HK$125 billion, closed down 0.1 percent ahead of the results announcement.
Reuters, with FashionNetwork.com
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