Yuzhou Group Holdings Co., Ltd. · HKEX:1628
Yuzhou — Yuzhou Properties Company — Investor Presentation (May 2013)
52 slides from Yuzhou's investor presentation, May 2013
Slide 1: Corporate Presentation
May 2013 Corporate Presentation
Slide 2: Disclaimer
DISCLAIMER These materials have been prepared by Yuzhou Properties Company Limited (the “Company”) solely for informational use during its presentation to current and/or prospective investors to provide an update on the business performance and development of the Company. No representation or warran
Slide 3: Table of Contents
TABLE OF CONTENTS I. COMPETITIVE EDGES II. FINANCIAL HIGHLIGHTS III. BUSINESS REVIEW IV. FUTURE PERSPECTIVES V. APPENDIX 3
Slide 4: About Yuzhou Properties (01628.HK)
ABOUT YUZHOU PROPERTIES (01628. HK) A leading property developer in West Strait Economic Zone with footprints in the Top 3 largest cities in Fujian Province KEY FOCUS Successful expansion into Shanghai, Hefei, Tianjin, Longyan, Bengbu and Zhangzhou Well-established market leader in Xiamen with
Slide 5: Corporate milestones and property development track record
Corporate milestones and property development track record Yuzhou projects Key milestones and highlights XIAMEN YUZHOU WORLD XIAMEN YUZHOU XIAMEN YUZHOU CASTLE TRADE CENTER UNIVERSITY CITY ABOVE CITY 2013: Acquired 3 projects YTD 2013 in Bengu, Hefei and Zhangzhou, with a total GFA of 1.8m sq.m. 201
Slide 6: Snapshot of Land Bank
SNAPSHOT OF LAND BANK 8.50million sq.m. as at 30 April 2013* Saleable Average Land % of GFA No. of Cost saleable City (‘000 sq.m.) projects （RMB/sq.m.） GFA Bohai Rim Tianjin 451 2 1,123 5 Region Shanghai 520 5 2,192 6 Yangtze Hefei 2,068 3 1,033 24 River Delta Bengbu 668 1 660 8 Tianjin Xiamen 2,606
Slide 7: Simplified shareholding structure
Simplified shareholding structure Lam Lung On & China Life Franklin Other public Xiamen C&D Hui Wing Mau Xiamen ITG Kwok Ying Lan Asset Management shareholders 75.0% 2.5% 1.2% 1.2% 0.8% 19.3% Yuzhou Properties Company Limited (Cayman Islands) (01628.HK) 100% Yuzhou International Holdings Co. (BVI) 6
Slide 8: Competitive Edges
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Slide 9: Competitive edges summary
1 Leading property developer in Fujian province 2 Prudent land acquisition and defensive land cost 3 Solid execution capability with proven track record 4 Healthy financial position with diversified funding channels 5 Outstanding management and strong corporate governance 9
Slide 10: Leading property developer in Fujian province
1 Leading property developer in Fujian province Established footprints in the 3 largest cities in Fujian province1 Yangtze River Xiamen Delta (YRD) Shanghai West Strait Economic Zone Fujian Fuzhou Quanzhou • Established in Xiamen in 1994 with 19 years of track record and experience • Current land ba
Slide 11: Unparalleled market leadership in Xiamen
1 Leading property developer in Fujian province Unparalleled market leadership in Xiamen with 19 years of track record and experience 3 Largest land bank in Xiamen among major listed developers* m sq.m. 3.00 Fuzhou 5 2.60 4 2.00 1.87 Quanzhou 1.00 0.87 Average: 0.56 Xiamen 6 0.53 0.45 2 1 0.27 0.26
Slide 12: West Strait Economic Zone: fast-growing region
1 Leading property developer in Fujian province West Strait Economic Zone — one of China's fastest growing regions with strong economic development and rising purchasing power GDP Disposable income per capita Average residential price RMB bn RMB '000 RMB/sq.m. 427 34 450 35 373 15,000 356 29 29 13,6
Slide 13: Strong corporate brand differentiates from competitors
1 Leading property developer in Fujian province Strong corporate brand meaningfully differentiates us from competitors in the market 2012 Top 10 Brand of Regional Real Estate 2012 Top 50 China Real Estate Listed Companies 2012 China Top 100 Listed Real Estate Companies China Famous Brand Companies w
Slide 14: Prudent land acquisition and defensive land cost
2 Prudent land acquisition and defensive land cost We adhere to prudent land acquisition policies and have managed to keep land cost at c.15% of average selling price Principles on land acquisitions Cost effective and sustainable expansion Unit land cost RMB/sq.m. Sustaining low • Ensure land cost t
Slide 15: Land replenishment in 2012
2 Prudent land acquisition and defensive land cost Prudent land replenishment in 2012 at an average cost of RMB975/sq.m. Total Saleable GFA Total Land Cost Average Land Cost Date of Acquisition City Project Type Methodology (sq.m.) (RMB million ) (RMB/sq.m.) April 2012 Quanzhou Resi/Com/Retail Biddi
Slide 16: Land replenishment in 2013
2 Prudent land acquisition and defensive land cost Prudent land replenishment in 2013 at an average cost of RMB1,281/sq.m. Total Saleable GFA Total Land Cost Average Land Cost Date of Acquisition City Project Type Methodology (sq.m.) (RMB million ) (RMB/sq.m.) January 2013 Bengbu Resi/Com/Retail M&A
Slide 17: Strong growth since IPO with stable profit margins
3 Solid execution capability with proven track record Strong growth achieved since IPO with stable profit margins Revenue, gross profit and gross margin Recognized GFA & ASP RMB m '000 sq.m. RMB'000/sq.m. 50% 49% 6,000 43% 42% 50% 600 10 528 11 12 40% 502 9 40% 500 8 10 4,266 3,839 3,894 8 4,000 400
Slide 18: Outstanding contracted sales despite policy headwinds
3 Solid execution capability with proven track record Outstanding contracted sales despite policy headwinds in the past 18 months 2012 Sell-through rate Contracted sales 80% RMB m 73% 69% 7,000 6,529 67% Average: 67% 70% 6,000 5,217 60% 55% 5,000 4,296 3,852 4,000 50% 3,000 40% 2,000 1,110 1,000 30%
Slide 19: Healthy financial position and diversified funding channels
4 Healthy financial position and well diversified funding channels Strong balance sheet with healthy debt profile and limited outstanding land premium Healthy net gearing¹ amongst B-rated peers Well-staggered debt maturity profile % of total debt 90% < 1 year 2.5 33% 79% 80% Average: 64.1% 1-2 years
Slide 20: Healthy financial position and multiple funding channels
4 Healthy financial position and multiple funding channels Credit Facilities Used Facilities Remaining Facilities # Lending Banks City (as of 31 Dec 2012, RMB m) (as of 31 Dec 2012 RMB m) (as of 31 Dec 2012 RMB m) 1 ICBC Xiamen 2,200 210 1,990 2 CCB Xiamen 1,980 1,457 523 3 BOC Xiamen 750 460 290 4
Slide 21: Outstanding management: senior management
5 Outstanding management and strong corporate governance Senior Management Mr. LAM Lung On Chairman, CEO • Founded Yuzhou Properties in 1994 • Over 18 years of experience in residential, commercial and hotel property development and investment Ms. KWOK Ying Lan Mr. CAI Ming Hui Mr. LIN Longzhi Vice
Slide 22: Strong corporate governance
5 Outstanding management and strong corporate governance Strong corporate governance Yuzhou's corporate governance The Board principles emphasise a quality Board, LAM Lung On (Chairman and CEO) sound internal controls, transparency and accountability to all shareholders Delegation of power Reporti
Slide 23: Financial Highlights
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Slide 24: Highlights of 2012 Annual Results
HIGHLIGHTS OF 2012 ANNUAL RESULTS FINANCIAL HIGHLIGHTS FOR THE 12 MONTHS ENDED 31 DECEMBER 2012 Compared with FY2011 Recognized revenue: RMB3,893.8 million (+RMB54.7 million or +1.4%) Contracted sales: RMB6,529.1 million (+RMB2,233.2 million or +52.0%) Core profit attributed to shareholders: R
Slide 25: FY2012 Key Profit & Loss Items
FY2012 KEY PROFIT&LOSS ITEMS Revenue* Gross Profit RMB million RMB million 1,777 1,884 4,266 3,839 3,894 1,543 2,223 768 2H 1,548 2H 3,073 2,939 1,112 1H 1H 2,043 1,009 766 955 336 431 FY2010 FY2011 FY2012 FY2010 FY2011 FY2012 EBITDA Core Profit RMB million RMB million 1,747 1,848 810 757 1,466 583
Slide 26: FY2012 Revenue Breakdown
FY2012 REVENUE BREAKDOWN (RMB’000) FY2012 FY2011 Change 100%=RMB3,894 million 100%=RMB3,839 million 100% Sales of 1.6% 1.4% 3,784,421 3,735,365 1% properties 98% 1.2% 1.3% Rental income 48,245 51,411 -6% 96% Property 94% 61,170 52,300 +17% 97.3% management fees 97.2% 92% Total 3,893,836 3,839,076 +1
Slide 27: Analysis on FY2012 Recognized Property Sales
ANALYSIS ON FY2012 RECOGNIZED PROPERTY SALES Recognized Property Sales* Recognized GFA & ASP RMB million GFA (sq.m.) ASP (RMB/sq.m.) 700,000 15,000 4,198 3,735 3,784 600,000 528,282 10,654 501,618 500,000 10,000 2,185 7,947 350,601 7,544 400,000 2,886 2H 3,011 300,000 1H 200,000 5,000 2,013 100,000
Slide 28: FY2012 Key Balance Sheet Items
FY2012 KEY BALANCE SHEET ITEMS Cash Position Total Debt RMB million RMB million 3,729 7,509 2,733 5,557 1,956 4,780 5,030 Long-term 4,222 3,742 Short-term 2,479 1,038 1,335 FY2010 FY2011 FY2012 FY2010 FY2011 FY2012 Total Asset Shareholders’ Equity RMB million RMB million 22,278 6,001 5,351 18,580 4,
Slide 29: FY2012 Stable Financial Position
FY2012 STABLE FINANCIAL POSITION Net Gearing Ratio Debt Profile by Maturity % % 2 500 400 421 Within 1 year 364 33 300 1 to 2 year 2 to 5 year 200 Over 5 year 100 42 64 62 17 0 50 15 2007 2008 2009 2010 2011 2012 Debt Profile by Currency Debt Profile by Type % % 37 Fixed US$ interest rate HK$ 49 Flo
Slide 30: Business Review
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Slide 31: 1Q2013 Contracted Sales +162% Year-on-Year
1Q2013 CONTRACTED SALES +162% YEAR-ON-YEAR Contracted Sales Interest in Contracted As of Total Contracted Contracted Project GFA ASP (1Q2011 vs. 1Q2012vs. 1Q2013) # Project City Sales (RMB/sq. RMB million % (RMB mn) (%) (sq.m.) m.) Yuzhou University City 1 Xiamen 100% 7 0% 542 12,417 Phase II 2 Yuzh
Slide 32: FY2012 Contracted Sales +52% Year-on-Year
FY2012 CONTRACTED SALES +52% YEAR-ON-YEAR Contracted Contracted Contracted Contracted Sales Sales As of Total GFA ASP # Project City (FY2010 vs. FY2011vs. FY2012) (RMB mn) (%) (sq.m.) (RMB/sq.m.) RMB million 1 Yuzhou University City Phase II Xiamen 284 4% 39,994 7,112 2 Yuzhou Castle above City Xiam
Slide 33: Monthly Contracted Sales in 2011 vs. 2012
MONTHLY CONTRACTED SALES IN 2011 vs. 2012 Monthly Contracted Sales ( Jan 2011 – Dec 2012) Contracted Sales ASP (RMB million) (RMB/sq.m.) 1,000 11,069 12,000 11,132 10,406 881 882 10,611 9,907 10,407 9,830 9,637 8,972 778 9,226 9,044 9,332 10,000 800 8,983 9,839 689 8,605 9,453 8,836 8,915 644 7,891
Slide 34: FY2012 Sell-through Rate Reached 67%
FY2012 SELL-THROUGH RATE REACHED 67% The Average Sell-through Rate is 67% % 96 79 77 77 80 73 67% 65 65 59 64 63 61 60 53 53 53 45 46 39 40 20 0 University Castle Golf Sunshine Shoreline Central Central Riverside Gushan Oriental City Plaza I Land Skyline I Skyline II Skyline III Palace Others City I
Slide 35: Cost Structure - Higher Profitability
COST STRUCTURE-HIGHER PROFITABILITY Cost of Properties Sold as a % of Revenue from Sale of Properties (FY2009 vs. FY2010 vs.FY2011 vs. FY2012) % 100% GP GP GP GP Margin*: Margin*: Margin*: Margin*: 80% 49% 49% 41% 49% 40% 40% 41% 49% 60% 3% 4% 3% 4% Total Total Total Total 40% Costs: Costs: Costs: C
Slide 36: FY2012 Cash Flow Position
FY 2012 CASH FLOW POSITION (Unaudited) RMB Bn RMB Bn FY2011 FY2012 FY2013 (A) (A) (E) Cash on Cash on Hand Cash on Hand (at the Hand 2.73 1.96 3.73 1.96 beginning) Cash Proceeds from Contracted Sales 4.16 6.14 7.50 Rental, Management Fee & Other Income Rental, Management Fee & 0.28 Other Income 0.19
Slide 37: Future Perspectives
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Slide 38: Macroeconomic & Market Outlook
MACROECONOMIC & MARKET OUTLOOK China’s 7.5% full-year GDP growth target is healthy and sustainable, if china’s growth coupled with the US economic recovery, will help bring a positive effect on the world economy Chinese government is focused on promoting the West Strait Economic Zone as a new gr
Slide 39: Our Strategies to Weather the Market
OUR STRATEGIES TO WEATHER THE MARKET Product and pricing flexibility Experienced management Diversify product mix to user-oriented demand, better Highly experienced management team with strong catered to current market execution capabilities and deep industry insights Flexible pricing strategy
Slide 40: FY2013: Detailed Launch Table
FY2013: DETAILED LAUNCH TABLE Planned Sales GFA for Planned Sales GFA for Planned Sales GFA for Percentage of Planned Project Name City Product Type Launch Type 1H 2013 2H 2013 FY2013 Sales GFA (%) (sq.m.) (sq.m.) (sq.m.) Apartment Existing 91 0 91 0% 1 Yuzhou University City Retail Existing 634 0 6
Slide 41: FY2013: Launch Breakdown
FY2013: LAUNCH BREAKDOWN By City By Launch Type % Tianjin % 6 Xiamen Hefei Xiamen New Fuzhou Existing 28 44 Launch Quanzhou 23 Longyan Shanghai Shanghai Hefei New Launch 5 Tianjin Longyan Quanzhou Fuzhou Existing 2 9 6 77 By Project Type By Period % Villa Office % 8 4 Apartment SOHO 4 Retail 1H Car
Slide 42: Major Contributing Projects in FY2013
MAJOR CONTRIBUTING PROJECTS IN FY2013 Xiamen Yuzhou Shoreline Xiamen Yuzhou Central Coast (廈門禹洲．尊海) (廈門禹洲．中央海岸) At the Heart of Haicang Located at the seafront CBD, offering a of Jimei District, right at panoramic view of the the transportation hub sea, lake and forestry High-rise residential
Slide 43: Future Land Bank Strategy
FUTURE LAND BANK STRATEGY Focus on the West Strait Economic Zone A new strategic focus and growth engine in China promoted by the State Council Penetrate further into the region To solidify the long-time market leadership by expanding into lower-tier cities such as Zhangzhou , Sanming and etc. Stick
Slide 44: Appendix
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Slide 45: Xiamen Property Market Overview
XIAMEN PROPERTY MARKET OVERVIEW Residential Land Supply and Property Transactions in Xiamen '000 sq.m. RMB/sq.m. 8,000 13,973 16,000 7,000 12,863 14,000 11,600 6,000 6,743 12,000 9,708 9,891 8,854 6,055 5,000 10,000 4,000 6,601 4,543 8,000 3,894 4,109 3,000 4,744 6,000 5,726 3,810 3,174 2,974 2,000
Slide 46: Fuzhou Property Market Overview
FUZHOU PROPERTY MARKET OVERVIEW Residential Land Supply and Property Transactions in Fuzhou '000 sq.m. RMB/sq.m. 12,000 14,243 16,000 13,092 11,322 14,000 10,000 10,435 12,000 8,000 10,000 7,963 7,619 7,244 6,000 8,000 6,214 5,813 5,634 6,000 4,000 3,976 5,138 5,363 2,981 4,263 4,400 4,000 2,990 3,4
Slide 47: Shanghai Property Market Overview
SHANGHAI PROPERTY MARKET OVERVIEW Residential Land Supply and Property Transactions in Shanghai '000 sq.m. RMB/sq.m. 40,000 22,278 22,502 25,000 21,728 35,000 34,809 20,000 30,000 16,039 13,971 25,000 15,000 20,000 23,421 10,556 9,655 7,767 20,128 18,999 15,000 17,941 10,000 17,776 16,914 16,151 7,9
Slide 48: Hefei Property Market Overview
HEFEI PROPERTY MARKET OVERVIEW Residential Land Supply and Property Transactions in Hefei '000 sq.m. RMB/sq.m. 14,000 6,259 6,351 7,000 6,007 12,000 6,000 4,635 11,827 10,000 4,100 10,684 5,000 10,256 9,531 9,619 9,403 8,000 3,154 8,900 4,000 2,799 2,874 8,439 7,754 6,000 3,000 6,256 5,833 4,000 5,3
Slide 49: Detailed Land Bank Table
DETAILED LAND BANK TABLE Sold and Delivered Project Site Area Location Unit Land Cost Total GFA Total Saleable GFA Pre-sold Saleable GFA Held for Sale Only Held for Investment Only Land Reserve Interest in the Project Saleable GFA (sq.m.) (RMB/sq.m.) (sq.m.) (sq.m.) (sq.m.) (sq.m.) (sq.m.) (sq.m.) (
Slide 50: Land Bank Breakdown
LAND BANK BREAKDOWN As at 31 Dec 2011 As at 31 Dec 2012 By City By City % 9 % 7 Xiamen Xiamen 8 11 Fuzhou 42 Fuzhou 39 Quanzhou Quanzhou 17 Longyan Hefei 22 Hefei Shanghai 5 Shanghai Tianjin 9 7 19 5 Tianjin By Project Type By Project Type % 11 % 10 3 4 Residential Residential Hotel & Office Hotel &
Slide 51: 2012 Key Financials
2012 KEY FINANCIALS For the period ended 31 Dec FY2012 FY2011 Change (%) Revenue (RMB’000) 3,893,836 3,839,076 +1% Gross Profit Margin (%) 40% 49% -9pp Core Profit (RMB’000) 810,426 582,993 +39% Core Profit Margin (%) 21 % 15% +6pp EPS (RMB cents/share) 0.25 0.33 -24% CEPS (RMB cents/share) 0.28 0.2
Slide 52: 2012 Key Financials
2012 KEY FINANCIALS (RMB’000) As at 31 Dec 2012 As at 31 Dec 2011 Change (%) Total current assets 17,589,771 13,723,526 +28% Total non-current assets 4,688,072 4,529,585 +3% Total current liabilities 10,617,388 7,669,484 +38% Total non-current liabilities 5,568,970 4,927,707 +13% Total equity 6,091,
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