Yuzhou Group Holdings Co., Ltd. · HKEX:1628
Yuzhou — Yuzhou Properties Company — Investor Presentation (November 2013)
52 slides from Yuzhou's investor presentation, November 2013
Slide 1: Corporate Presentation November 2013
Corporate Presentation November 2013
Slide 2: About Yuzhou Properties (01628.HK)
ABOUT YUZHOU PROPERTIES (01628. HK) A leading property developer in West Strait Economic Zone with footprints in Xiamen, Fuzhou and Quanzhou, the Top 3 largest cities in Fujian Province KEY FOCUS Successful expansion into Shanghai, Hefei, Tianjin, Longyan, Bengbu and Zhangzhou Well-established
Slide 3: Snapshot of Land Bank
SNAPSHOT OF LAND BANK 8.53million sq.m. as at Sep 2013 Saleable Average Land % of GFA No. of Cost saleable City (‘000 sq.m.) projects （RMB/sq.m.） GFA Bohai Rim Tianjin 451 2 1,061 5 Region Shanghai 643 6 3,356 8 Yangtze Hefei 2,039 3 1,042 24 River Delta Tianjin Bengbu 668 1 660 8 Xiamen 2,547 21 2,
Slide 4: 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 4 projects YTD 2013 in Bengu, Hefei, Zhangzhou and Shanghai, with a total GFA of 2.0m
Slide 5: 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% 0.7% 19.4% Yuzhou Properties Company Limited (Cayman Islands) (01628.HK) 100% Yuzhou International Holdings Co. (BVI) 6
Slide 6: Table of Contents
TABLE OF CONTENTS I. COMPETITIVE EDGES II. FINANCIAL HIGHLIGHTS III. BUSINESS REVIEW IV. FUTURE PERSPECTIVES V. APPENDIX 6
Slide 7: Competitive Edges
(3 Fa 0 Tit BE A 133 BRS] TS” YUZHOU PROPERTIES COMPANY LIMITED Stock Code: 01628.HK ~ Competitive Edges
Slide 8: 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 8
Slide 9: 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 10: 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. 2.50 2.13 Fuzhou 2.00 5 1.71 2 1.50 Quanzhou 0.87 0.77 1.00 0.55 Average: 0.60 6 0.50 0.45 0.42 0
Slide 11: 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. 471 38 14,243 500 40 15,000 12,863 427
Slide 12: Strong corporate brand differentiates from competitors
1 Leading property developer in Fujian province Strong corporate brand meaningfully differentiates us from competitors in the market 2013 Top 10 Brand of Regional Real Estate 2013 Top 50 China Real Estate Listed Companies 2013 China Top 100 Listed Real Estate Companies China Famous Brand Companies w
Slide 13: 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 Sustaining low • Ensure land cost to expected
Slide 14: Prudent land acquisition: 2013 acquisitions
2 Prudent land acquisition and defensive land cost 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 668,333 441 660 January 2013 Hefei Resi/Com/Retail Bidding and Auction
Slide 15: Solid execution capability with proven track record
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 16: 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 Sell-through rate Contracted sales 80% RMB m 73% 7,000 6,529 67% 68% 70% 5,699 6,000 5,217 60% 56% 5,000 4,296 3,852 3,799 4,000 50% 3,000 40% 2,000 1,110 1,000 30% 0 201
Slide 17: 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 100% % of total debt 91% < 1 year 3.0 90% 82% 36% Average: 76.5% 80%
Slide 18: 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 Jun,2013, RMB mn) (as of Jun,2013 RMB mn) (as of Jun,2013 RMB mn) 1 ICBC Xiamen 1,800 110 1,690 2 CCB Xiamen 1,480 1,195 285 3 CCB/ICBC/BOC Xiamen 1,200 630 5
Slide 19: 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. LIN Longzhi Vice Chairman, Executi
Slide 20: 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 21: Financial Highlights
(3 Fa 0 Tit BE A 133 BRS] TS” YUZHOU PROPERTIES COMPANY LIMITED Stock Code: 01628.HK FINANCIALHIGHLIGHTS 21
Slide 22: Highlights of 2013 Interim Results
HIGHLIGHTS OF 2013 INTERIM RESULTS FINANCIAL HIGHLIGHTS FOR THE SIX MONTHS ENDED 30 JUNE 2013 Compared with 1H2012 Recognized revenue: RMB1,032.2 million (+RMB77.4 million or +8.1%) Contracted sales: RMB5,699.1 million (+RMB1,900.3 million or +50.0%) Profit attributable to shareholders: RMB150
Slide 23: 1H2013 Key Profit & Loss Items
1H2013 KEY PROFIT&LOSS ITEMS Revenue* Gross Profit RMB million RMB million 3,073 2,939 1,548 2H 1,112 2H 1H 1H 766 955 1,032 336 431 331 FY2011 FY2012 1H2013 FY2011 FY2012 1H2013 EBITDA Profit Attributable to Shareholders RMB million RMB million 569 1,548 1,111 2H 621 2H 1H 1H 373 300 355 272 151 10
Slide 24: 1H2013 Revenue Breakdown
1H2013 REVENUE BREAKDOWN (RMB’000) 1H2013 1H2012 Change 100%=RMB 1,032 million 100%=RMB 955 million 100% Construction 0.5% 1.0% materials trading 5,043 9,539 -47% income 98% 2.7% 2.4% Property 27,667 22,664 +22% management fees 96% 2.4% 2.5% Rental income 24,960 24,202 +3% 94% Sales of properties 97
Slide 25: Analysis on 1H2013 Recognized Property Sales
ANALYSIS ON 1H2013 RECOGNIZED PROPERTY SALES Recognized Property Sales* Recognized GFA & ASP RMB million GFA (sq.m.) ASP (RMB/sq.m.) 150,000 10,718 12,000 10,343 9,478 9,000 100,000 3,011 2,886 2H 6,000 1H 50,000 102,815 70,030 83,827 3,000 724 898 975 0 0 FY2011 FY2012 1H2013 1H2011 1H2012 1H2013 R
Slide 26: 1H2013 Key Balance Sheet Items
1H2013 KEY BALANCE SHEET ITEMS Cash Position Total Debt RMB million RMB million 4,631 7,509 8,226 3,729 6,038 2,907 5,274 5,030 Long-term 4,398 Short-term 2,479 2,952 1,640 1H2012 FY2012 1H2013 1H2012 FY2012 1H2013 Total Asset Shareholders’ Equity RMB million RMB million 26,015 6,001 6,019 22,278 5,
Slide 27: 1H2013 Stable Financial Position
1H2013 STABLE FINANCIAL POSITION Net Gearing Ratio Debt Profile by Maturity % % 2 80 64 62 59 Within 1 year 60 36 1 to 2 year 40 42 2 to 5 year 20 Over 5 year 17 0 45 17 2009 2010 2011 2012 1H2013 Debt Profile by Currency Debt Profile by Type % % 35 Fixed US$ interest rate HK$ 53 Floating RMB intere
Slide 28: Business Review
(3 Fa 0 Tit BE A 133 BRS] TS” YUZHOU PROPERTIES COMPANY LIMITED Stock Code: 01628.HK BUSINESS REVIEW 28
Slide 29: 10M2013 Contracted Sales +70% Year-on-Year
10M*2013 CONTRACTED SALES +70% YEAR-ON-YEAR Interest Contracted As of Contracted Contracted Contracted Sales # Project City in Project Sales Total GFA ASP (10M2011 vs. 10M2012vs. 10M2013) % (RMB mn) (%) (sq.m.) (RMB/sq.m.) Yuzhou University City Phase RMB million 1 Xiamen 100% 7 0% 542 12,417 II Yuz
Slide 30: FY2012 Contracted Sales +52% Year-on-Year
FY2012 CONTRACTED SALES +52% YEAR-ON-YEAR Contracted Contracted Contracted Contracted Sales # Project City Sales As of Total GFA ASP (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 6,529 2 Yuzhou Castle above Cit
Slide 31: Monthly Contracted Sales in 2012 vs. 2013
MONTHLY CONTRACTED SALES IN 2012 vs. 2013 Monthly Contracted Sales ( Jan 2012 – Oct 2013) Contracted Sales ASP (RMB’million) (RMB/sq.m.) 2,500 2,410 16,000 14,000 2,000 13,799 11,501 13,407 12,000 10,531 12,655 10,407 9,637 9,867 8,836 9,907 9,815 9,226 10,000 1,500 8,687 8,915 8,704 8,576 8,983 8,6
Slide 32: 1H2013 Sell-through Rate Reached 73%
1H2013 SELL-THROUGH RATE REACHED 73% The Average Sell-through Rate is 73% % 87 86 79 77 80 74 75 73 66 60 56 43 46 46 42 40 36 37 20 0 University Castle Golf Shoreline Central Riverside Dream Gushan Oriental City Plaza Land Skyline Palace Others Average City II above City Coast City Town Town No. On
Slide 33: 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 vs. 1H2013) % 100% 31% 80% 41% 40% 49% 49% 5% 60% 3% 4% 3% 4% 40% 37% 49% 30% 45% 38% 20% 18% 19% 15% 9% 11% 0% FY2009 FY2010 FY2011 FY2012 1H2013 Land costs
Slide 34: 1H 2013 Cash Flow Position
1H 2013 CASH FLOW POSITION (Unaudited) RMB Bn FY2012 1H2013 FY2013 RMB Bn (A) (A) (E) Cash on Cash on Cash on Hand (at the beginning) 1.96 3.73 3.73 Hand Hand 3.73 Cash Proceeds from Contracted Sales 6.14 4.39 8.50 Rental, Management Rental, Management Fee & Fee & Other Income Other Income 0.28 0.10
Slide 35: Future Perspectives
(3 Fa 0 Tit BE A 133 BRS] TS” YUZHOU PROPERTIES COMPANY LIMITED Stock Code: 01628.HK | FUTURE PERSPECTIVES 35
Slide 36: Macroeconomic & Market Outlook
MACROECONOMIC & MARKET OUTLOOK China’s 7.5% full-year GDP growth target is healthy and sustainable. China’s sustainable growth, coupled with the US economic recovery, will help bring a positive effect on the world economy Property sector continues to consolidate, the regulatory policy annexed by
Slide 37: 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 catered Highly experienced management team with strong to current market execution capabilities and deep industry insights Flexible pricing strategy
Slide 38: 2H2013: Detailed Launch Table
2H2013: DETAILED LAUNCH TABLE Planned Sales Area for Percentage of Planned Sales # Project Name City Launch Type 2H2013(sq.m.) Area(%) 1 Yuzhou University City Xiamen Existing 15,549 2% 2 Yuzhou Castle above City Xiamen Existing 2,836 0% 3 Yuzhou Golf Xiamen Existing 31,895 5% 4 Yuzhou Shoreline Xia
Slide 39: 2H2013: Launch Breakdown
2H2013: LAUNCH BREAKDOWN By City By Launch Type % Tianjin Shanghai 7 Xiamen % 4 Xiamen Fuzhou New Bengbu 30 Existing Quanzhou Launch 7 27 Longyan Hefei Hefei 20 Fuzhou Bengbu New Launch 6 Shanghai Longyan Quanzhou Existing 8 18 Tianjin 73 By Project Type By Region % Office SOHO % Bohai Rim 2 Apartme
Slide 40: Major Contributing Projects in 2H2013
MAJOR CONTRIBUTING PROJECTS IN 2H2013 Xiamen Yuzhou Cloud Top International Xiamen Yuzhou Central Coast (廈門禹洲．雲頂國際) (廈門禹洲．中央海岸) Located at the new core Located at the seafront of area of Xiamen Island, Jimei District, right at the linked to BRT (Bus Rapid transportation hub Transit) High-rise
Slide 41: Major Completion Projects in 2H2013
MAJOR COMPLETION PROJECTS IN 2H2013 Completion GFA Presold GFA as of June Presales as of June Major Project Completion Time (sq.m.) 2013(sq.m.) 2013(RMB million) Yuzhou Shoreline 4Q2013 303,480 249,019 3,436 Yuzhou Central 4Q 2013 175,770 153,632 1,534 Coast Phase I Yuzhou Skyline 4Q 2013 211,736 15
Slide 42: Land Banking Strategy
LAND BANKING 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 nearby cities Stick to our core competency Fujian To acquire lan
Slide 43: Appendix
(3 Fa 0 Tit BE A 133 BRS] TS” YUZHOU PROPERTIES COMPANY LIMITED Stock Code: 01628.HK APPENDIX 43
Slide 44: Xiamen Property Market Overview
XIAMEN PROPERTY MARKET OVERVIEW Residential Land Supply and Property Transactions in Xiamen '000 sq.m. RMB/sq.m. 8,000 18,000 15,252 7,000 13,973 16,000 12,863 6,000 6,743 14,000 11,600 6,055 12,000 5,000 9,708 9,891 8,854 10,000 4,000 4,543 6,601 4,109 8,000 3,894 3,000 4,744 6,654 3,174 3,159 2,27
Slide 45: Fuzhou Property Market Overview
FUZHOU PROPERTY MARKET OVERVIEW Residential Land Supply and Property Transactions in Fuzhou '000 sq.m. RMB/sq.m. 12,000 16,327 18,000 14,243 16,000 10,000 13,092 10,435 14,000 11,322 8,000 12,000 7,963 10,000 6,000 7,244 7,619 6,214 5,813 8,000 5,634 4,000 3,976 6,000 5,138 4,263 5,363 2,981 4,400 3
Slide 46: Shanghai Property Market Overview
SHANGHAI PROPERTY MARKET OVERVIEW Residential Land Supply and Property Transactions in Shanghai '000 sq.m. RMB/sq.m. 23,668 40,000 22,278 22,502 25,000 21,728 35,000 34,809 20,000 30,000 16,039 25,000 13,971 15,000 20,000 23,421 10,556 9,655 7,767 20,128 18,999 15,000 17,941 17,776 10,000 16,151 16,
Slide 47: 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 6,437 7,000 6,007 12,000 6,000 4,635 11,827 10,000 10,684 5,000 10,256 4,100 9,531 9,619 9,403 8,000 3,154 8,900 4,000 2,874 8,439 2,799 7,754 6,000 3,000 6,256 6,339 6,3
Slide 48: Detailed Land Bank Table
DETAILED LAND BANK TABLE Sold and Delivered Pre-sold Saleable Held for Interest in the Project Site Area Location Unit Land Cost Total GFA Total Saleable GFA Held for Sale Only Land Reserve Saleable GFA GFA Investment Only Project (sq.m.) (RMB/sq.m.) (sq.m.) (sq.m.) (sq.m.) (sq.m.) (sq.m.) (sq.m.) (
Slide 49: Diversifying Land Bank
DIVERSIFYING LAND BANK As at 31 Dec 2012 As at 30 Jun 2013 By City By City % 7 % 5 Xiamen Xiamen 6 8 Fuzhou Fuzhou 8 30 Quanzhou 39 Quanzhou Longyan 17 Zhangzhou Longyan Hefei Hefei 24 4 Bengbu 5 Shanghai Shanghai 19 5 Tianjin 3 4 16 Tianjin By Project Type By Project Type % 10 % 11 4 4 Residential
Slide 50: 1H2013 Key Financials
1H2013 KEY FINANCIALS For the period ended 30 Jun 1H2013 1H2012 Change (%) Revenue (RMB’000) 1032,203 954,849 +8% Gross Profit (RMB’000) 330,559 430,570 -23% Gross Profit Margin (%) 32% 45% -13pp Net Profit (RMB’000) 150,453 104,762 +44% Net Profit Margin (%) 15% 11% +4pp EPS (RMB cents/share) 4.35
Slide 51: 1H2013 Key Financials
1H2013 KEY FINANCIALS (RMB’000) As at 30 Jun 2013 As at 31 Dec 2012 Change (%) Total current assets 21,186,794 17,589,771 +20% Total non-current assets 4,828,187 4,688,072 +3% Total current liabilities 14,077,032 10,617,388 +33% Total non-current liabilities 5,821,627 5,568,970 +5% Total equity 6,11
Slide 52: 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
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