Fosun in red on Alibaba's cheap repurchase and weak demand

Chinese conglomerate Fosun International (0636) swung to a net loss of 4.3 billion yuan (HK$4.6 billion) last year from a net profit of 1.38 billion yuan one year ago, blaming the slumped paper value of its holdings in Cainiao and weak consumption demand.

The total revenue dipped 3.1 percent year-over-year to 192 billion yuan. 

The consumption nd tourism business, contributing nearly 40 percent of total income, recorded a 13.8 percent slide last year due to the weak retail sales. The sector’s profit also widened by 612 percent to 1.88 billion yuan.

The asset management business is the largest loss-making sector, with the losses inflating 690 percent to 4.37 billion yuan, offsetting the 117 percent growth posted in the earnings of insurance.

It comes after Alibaba (9988) repurchased shares in Cainiao held by its minority shareholders at US$0.62 (HK$4.84) per share last year, slashing the value of Fosun’s stake in the logistics firm and leading to a one-off non-cash book loss of 5.1 billion yuan.

Fosun declared a dividend of 2 HK cents per share for 2024, 47 percent lower than one year ago.

STAFF REPORTER