China Vanke Co., Ltd Class A · SZSE:000002
China Vanke Co., Ltd Class A — H1 2023 Earnings Presentation
46 slides from China Vanke Co., Ltd Class A's earnings presentation, August 2023
Slide 1: 2023 Interim Results Announcement
2023 INTERIM RESULTS ANNOUNCEMENT C H I N A VA N K E C O . , LT D . August 2023
Slide 2: Contents
I. Results Overview CONTENTS II. Highlights of 2023 H1 III. ESG Performance IV. Priorities for 2023 H2
Slide 3: I. Results Overview
I. Results Overview In the first half of 2023, the market prosperity rebound for a short term but later plunged again, indicating a critical situation. In response, Vanke adhered to its strategy of “concurrently focusing on both development and operation & service businesses”， which enabled the Grou
Slide 4: Revenue and net profit attributable to the parent company decreased
Revenue and net profit attributable to the parent company decreased 3 Total revenue was RMB 200.89 billion, representing a YoY decrease of 2.9%. Net profit attributable to equity shareholders stood at RMB 9.87 billion, representing a YoY decrease of 19.4%, mainly due to the decline in the settlement
Slide 5: Results Overview
Results Overview 4 Operating cash flow Structure of interest-bearing liabilities Financing method Short-term liabilities accounted for Unsecured & unpledged financing accounted for Net cash inflow for 14 consecutive years 14.2 % 93.9 % Lowest on record Property Development business Operation & Servi
Slide 6: Summary of key accounting data and financial indicators
Summary of key accounting data and financial indicators 5 Profit & Loss Assets & Liabilities Jan-Jun 2023 Jan-Jun 2022 Var June 30, 2023 Dec 31, 2022 Var Revenue 200.89 billion 206.92 billion -2.9% Cash on hand 122.18 billion 137.21 billion -11.0% Gross margin -4.2% 18.9% 20.5% -1.6pct Total assets
Slide 7: II. Highlights of 2023 H1
II. Highlights of 2023 H1 • Upholding the bottom line of financial security
Slide 8: Maintaining an industry-leading credit rating with low financing costs
Maintaining an industry-leading credit rating with low financing costs 7 Moody’s Baa1 stable S&P BBB+ stable Fitch BBB+ stable CCXI AAA stable Net operating cash inflow for 14 consecutive years, amounted to RMB1.86 billion in the first half of 2023 Cash on hand/short-term debt coverage ratio has Cos
Slide 9: The structure of interest-bearing liabilities continues to improve
The structure of interest-bearing liabilities continues to improve, 8 bolstering security resilience The Company’s interest-bearing liabilities amounted to RMB 321.36 billion (+2.3%), with unsecured and unpledged debt representing 93.9%. No offshore interest- bearing liabilities will be due in 2023
Slide 10: II. Highlights of 2023 H1
II. Highlights of 2023 H1 • Committed to improving business capabilities
Slide 11: Property Development Business: maintaining industry-leading scale with successful delivery
Property Development Business: maintaining industry-leading scale with 10 successful delivery of 92,000 high-quality residential units Sales Settlement Sales Receivable turnover Settlement revenue Settlement GM amount /Sales amount 203.94 billion (-5.3%) Nearly100% 170.84 billion (-4.5%) 20.3% (-1.6
Slide 12: Property Development Business: investment quality significantly improved
Property Development Business: investment quality significantly improved, 11 with 32 new projects secured in Jan-Aug Cherry picking the best projects with stable regional markets Smooth progress in new construction and high profitability and completion Total land Average land premium GFA of new/resu
Slide 13: Property Development Business: product line efforts bearing fruit
Property Development Business: product line efforts bearing fruit, ensuring 12 stable delivery of high-quality projects at scale “Level-up” residential product lines “Langshi” has launched 14 projects across 7 cities. Nanjing Langshi In October 2022, the initial launch of 120 units achieved Hefei La
Slide 14: Property Development Business: product line efforts bearing fruit (Zhen)
Property Development Business: product line efforts bearing fruit, ensuring stable 13 delivery of high-quality projects at scale “Zhen”, another high-end “level-up" residential product line has launched 6 projects across 3 cities after upgrade and iteration. Shenzhen Zhenwanyue Since its initial unv
Slide 15: Building benchmark projects for comprehensive district development
Property Development Business: building benchmark projects for comprehensive 14 district development, leveraging multi-format and omni-scenario advantages Our comprehensive development projects, such as Liangzhu Culture Village in Hangzhou and Centennial Waterfront in Nanchang, have set the standard
Slide 16: Integrating natural and ecological urban contexts to foster future-ready product
Property Development business: integrating diverse natural and ecological urban 15 contexts to foster future-ready product R&D capabilities The Future City project makes its Shanghai debut, seamlessly blending urban public spaces with cutting-edge technologies and showcasing industry-city integratio
Slide 17: Elevating customer experience and service competitiveness through a full cycle
Property Development business: elevating customer experience and service 16 competitiveness through a full cycle Sales stage 61.3K groups of customers signed contracts online Construction stage 58.4K customers joined site quality inspection (involves 364 under-construction projects in 53 cities) Ima
Slide 18: Operation & Service Business: total revenue reached RMB 26.73 billion
Operation & Service Business: total revenue reached RMB 26.73 billion, 17 up by 11.9% YoY Property services Rental housing Logistics & Commercial business Total revenue (RMB Revenue (RMB Warehousing Total revenue (RMB hundred million) Total revenue (RMB hundred million) hundred million) hundred mill
Slide 19: Onewo: implementing the Onewo Town Strategy
Onewo: implementing the Onewo Town Strategy for robust core business growth 18 Onewo1 revenue RMB 16.11 billion +12.2% Residential property services projects Integrated commercial, Artificial Intelligence of Things (AIoT) Residential consumption enterprise and urban and business process as a service
Slide 20: Onewo: expanding customer boundaries in commercial and corporate services
Onewo: expanding customer boundaries and deepening service concentration in 19 commercial and corporate services New managed New contracted Cumulative Cumulative projects projects managed projects contracted projects 129 223 1,964 2,329 Contribution of existing Firms worth customers to the New Fortu
Slide 21: Onewo: developing across community, commercial and urban spaces
Onewo: synergistically developing across community, commercial and urban 20 spaces, aiming to deliver stable, reliable, and high-quality services Commerical / Residential services corporate services Smart city services Carried out multiple activities with a Received 19 RICS China awards, Already imp
Slide 22: Rental Housing: managing 225,000 Long-Term-Lease Apartment units
Rental Housing: managing 225,000 Long-Term-Lease Apartment units with 21 increasing scale and operating efficiency Unveiled units Steadily improving operational efficiency 174,000 2023H1 2022 Var Vanke remains China’s largest centralized rental housing provider, ranking top 3 in 27 Customer acquisit
Slide 23: Rental Housing: comprehensive rental housing solutions
Rental Housing: Providing comprehensive rental housing solutions across multiple 22 property types. Delivering high-quality rental services with a human touch Customer Customer Registered users Large rental community compounds over the online satisfaction renewal rate platform represented by “Yuan E
Slide 24: Rental Housing: expanding enterprise client base
Rental Housing: making efforts to expand its enterprise client base , aiming to provide 23 "headquarter-to-headquarter" rental services, specifically tailored for top-tier companies Cumulatively Share of corporate New corporate served tenants customers corporates 21.5% 1,524 4,460 Centralized Rental
Slide 25: Rental Housing: exploring asset securitization and market-based transfer
Rental Housing: exploring asset securitization, market-based transfer and other 24 commercial closed-loop paths CCB & Vanke Rental Housing Fund Project: Port CCB & Vanke Rental Housing Fund Project: Port Apartment Xizhimen Residences Beijing CCB Rental Apartment Future Center Residences Wuhan Housin
Slide 26: Logistics & Warehousing: cold chain business continues to lead
Logistics & Warehousing: cold chain business continues to lead with sustained 25 growth in overall revenue Steady revenue growth Stable occupancy rate 19.5 16.6 (RMB hundred million) Occupancy rate of high-standard warehouses in the stable period: 85% +17.0% 13.4 10.4 11.4 Cold chain utilization rat
Slide 27: Logistics & Warehousing: creating industry-leading supply chain service capabilities
Logistics & Warehousing: creating industry-leading supply chain service capabilities 26 Warehouse network layout Operational services as a with nationwide coverage core competency National warehouse network: Warehouses in 47 cities with an area of over 12 million+ m2 Digital solutions: Traceable, vi
Slide 28: Logistics & Warehousing: first bonded refrigerated warehouse
Logistics & Warehousing: creating the first bonded refrigerated warehouse and 27 gaining customer recognition for operational services VX Shenzhen Yantian Cold Chain Park Park positioning: Multi-temperature-zone, Integrated services of import and export smart cold chain logistics complex with custom
Slide 29: Retail property: improving operation quality with increased revenue and occupancy
Retail property development and operations: improving the quality of 28 operation with the overall increase in revenue and occupancy rate Increasing revenue 203 unveiled Continuous provision of and occupancy rate projects management Overall revenue (including non-consolidated SCPG provided managemen
Slide 30: Retail property: improving consumer infrastructure and operational service competitiveness
Retail property development and operations: improving the construction of 29 consumer infrastructure and operational service competitiveness 160 projects Focus on commercial Entire value chain property 50+ cities Developing Possess complete "investment, financing, Specialize in the consumer infrastr
Slide 31: Retail property: strengthening new project preparation and revitalization
Retail property development and operations: continuously strengthening new 30 project preparation and revitalization of existing projects’ capabilities New projects Revitalization of existing projects Shenzhen Bay Rail In: Super Headquarters of Shenzhen Bay Wuhan Qingshan InCity: After a Commercial
Slide 32: Technology empowers business performance, cost reduction, and efficiency improvement
Technology empowers business performance, cost reduction, 31 and efficiency improvement Strengthening data governance for overall, dynamic and refined business management. Acquiring property development process data with certificate, drawing, and drone image identification technologies. Leveraging a
Slide 33: III. ESG Performance
III. ESG Performance
Slide 34: Implementing green & low-carbon concepts
Implementing green & low-carbon concepts, assisting 33 national carbon peak/neutrality goals Developing green buildings New construction projects have been meeting green building evaluation standards for 10 consecutive years. By the end of June 2023, the area of Vanke's green buildings reached 316 V
Slide 35: Case studies: Future-oriented low-carbon development projects
Case studies: Future-oriented low-carbon development projects 34 Shanghai Vanke Ideal Place VX Fengxian Lingang Logistics Park The project has created a holistic low-carbon community (carbon reduction by 31%) With a GFA of 98,600 m², the Logistics Park is a hybrid park of high-standard dry and regio
Slide 36: Industry-leading ESG ratings and sustainable development capabilities
Industry-leading ESG ratings and 35 continued enhancement of sustainable development capabilities Hang Seng Sustainability CNI ESG Index MSCI-ESG rating Sustainalytics AA A+ Included in the Shenzhen 100 Top-rated real estate developer with continued inclusion in the A- BBB Low risk ESG Leading Index
Slide 37: IV. Priorities for 2023 H2
IV. Priorities for 2023 H2
Slide 38: Priorities for 2023 H2
Priorities for 2023 H2 37 The real estate industry is experiencing a slump in transactions and a challenging business environment. In the second half of the year, the Group will focus on the following priorities in accordance with the arrangements made at the beginning of the year: First, ensuring o
Slide 39: Priorities for 2023 H2
Priorities for 2023 H2 38 At each business levels: Property Development Business: Proactively collect outstanding funds; explore new stage investment capabilities to ensure investment realization; upgrade procurement mechanisms to improve quality and efficiency for product lines; and ensure delivery
Slide 40: Appendix
Appendix
Slide 41: Condensed Consolidated Statement of Profit or Loss
Appendix: Condensed Consolidated Statement of Profit or Loss 40 For the six months ended 30 June 2023 Jan – Jun 2023 Jan – Jun 2023 2021 RMB’000 RMB’000 2020 RMB’000 RMB’000 Revenue 200,892,590 206,916,289 Cost of revenue (163,003,306) (164,586,222) Gross profit 37,889,284 42,330,067 Other net incom
Slide 42: Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income
Appendix: Condensed Consolidated Statement of Profit or Loss and Other 41 Comprehensive Income For the six months ended 30 June 2023 Jan2021 RMB’000 – Jun 2023 2020 RMB’000 Jan – Jun 2023 RMB’000 RMB’000 Profit for the period 15,168,214 18,130,911 Other comprehensive income for the period (after tax
Slide 43: Condensed Consolidated Statement of Financial Position
Appendix: Condensed Consolidated Statement of Financial Position 42 As at 30 June 2023 30 June 2023 31 December 2022 RMB’000 RMB’000 Non-current assets Property, plant and equipment 2021 RMB’000 36,120,479 2020 RMB’000 35,133,670 Investment properties 127,009,102 119,407,195 Intangible assets and go
Slide 44: Condensed Consolidated Statement of Financial Position
Appendix: Condensed Consolidated Statement of Financial Position 43 As at 30 June 2023 30 June 2023 31 December 2022 RMB’000 RMB’000 Non-current liabilities 2021 RMB’000 2020 RMB’000 Bank loans and borrowings from financial institutions 215,187,493 180,773,281 Bonds payables 60,474,020 68,815,570 Le
Slide 45: Condensed Consolidated Cash Flow Statement
Appendix: Condensed Consolidated Cash Flow Statement 44 For the period ended 30 June 2023 Jan – Jun 2023 Jan – Jun 2023 RMB’000 RMB’000 Operating activities 2021 RMB’000 2020 RMB’000 Cash generated from operations 21,716,681 31,430,141 Income Tax paid (19,852,180) (23,142,120) Net cash generated fro
Slide 46: Thanks!
THANKS！ Vanke Vanke IR E-house Weekly IMPORTANT NOTICE： The content of this material is extracted from Vanke's 2023 Interim Report. If there is any discrepancy, please refer to the interim report www.vanke.com 0755-25606666 IR@vanke.com