Yuzhou outlook revised to positive on robust earnings growth

    S&P Global Ratings said that it had revised its outlook on China-based property developer Yuzhou Properties Co. Ltd. (01628) to positive from stable.
  At the same time, the credit rating agency affirmed its 'B+' long-term corporate credit rating and 'cnBB' long-term Greater China regional scale rating on Yuzhou. S&P also affirmed its 'B' long-term issue rating and 'cnBB-' long-term Greater China regional scale rating on the company's senior unsecured notes.
  "We revised the outlook because we expect Yuzhou to rapidly expand its operating scale and materially minimize the gap in scale compared with its larger peers' over the next 12 months," said S&P Global Ratings credit analyst Brian Huang.
  The company's high earnings reliance on a single province, Fujian, has constrained its credit profile. But we expect this to improve as Yuzhou establishes a meaningful presence outside its home market.
  "We expect the company to maintain its above-average margins and financial discipline with a gradual improvement in leverage during its expansion," said Huang. The company has a track record of balancing growth and high profitability as it expands.