Yuzhou Group Holdings Co., Ltd. · HKEX:1628

Yuzhou — Yuzhou Properties Company — FY2017 Earnings Presentation

46 slides from Yuzhou's earnings presentation, March 2018

  1. Slide 1: Yuzhou Properties Annual Report

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  2. Slide 2: Speakers

    Speakers Deputy to the National People’s Congress, Mr. LAM Lung On, J.P. Founder, Chairman & Executive Director Mr. CAI Minghui Executive President Mr. Jacky WONG CFO & Company Secretary

  3. Slide 3: Founder

    Founder Deputy to the National People’s Congress Mr. Lam Lung On, J.P. Founder, Chairman and Executive Director  Vice Chairman of the All-China General Chamber of Industry and Commerce (Member of the All-China Federation of Industry and Commerce (“ACFIC”))  Honorary President of the Hong Kong Chin

  4. Slide 4: Company Highlights

    Company Highlights Contracted sales – record high RMB40.3bn, +73.7% Land Bank: 15mn+ sq.m. Revenue +58.7% Saleable Resources: Gross Profit Margin 35.4% Robust RMB300bn+ Core Profit Margin 13.5% Contracted Sales Avg. Land Cost: RMB4,500+ Payout Ratio 36% *as at Mar 27, 2018 High Profitability Ample L

  5. Slide 5: Business Overview

    Hangzhou ·Riverside Sapphire Business Overview – A journey of RMB100bn in contracted sales begins A fruitful year in 2017: achieved the goal of RMB40bn contracted sales with quality land bank replenishment; established product lines with Yuzhou features. Other segments also delivered.

  6. Slide 6: Strong Contracted Sales Hit a Record High

    Strong Contracted Sales Hit a Record High  Sales performance has grown dramatically over the past few years. Contracted sales increased to RMB40.3bn in 2017 and hit a record high  Contracted ASP increased by 33% YoY, due to change of product portfolio  Presence actively extended in the first- and

  7. Slide 7: Contracted Sales in FY2017

    Contracted Sales in FY2017 Interest in Contracted Sales As of Total Contracted GFA Contracted ASP # Project City Project (%) (RMB mn) (%) (sq.m.) (RMB/sq.m.) 1 Yuzhou Central Coast Xiamen 100% 132 0% 7,114 18,515 2 Yuzhou Riverside City Town Xiamen 100% 3,071 8% 158,386 19,391 3 Haicang Dream Town X

  8. Slide 8: Monthly Contracted Sales & ASP in 2017

    Monthly Contracted Sales & ASP in 2017 Monthly Contracted Sales & Contracted ASP (Jan 2016 – Dec 2017) Contracted Sales Contracted ASP (RMB mn) (RMB/sq.m.) 25,000 5,106 5,000 20,116 20,000 17,728 18,799 16,921 4,290 20,000 17,180 4,000 14,435 16,146 3,891 16,828 15,252 3,995 3,450 3,525 3,598 14,309

  9. Slide 9: Win-Win of Scale & Profitability

    Win-Win of Scale & Profitability Revenue, Gross Profit & Gross Profit Margin Recognized GFA & ASP GFA ASP RMB mn ‘000 sq.m. RMB ‘000 / sq.m. 21,701 35.7% 36.3% 40.0% 20,000 1,600 14,118 16,000 35.4% 30.0% 16,000 13,672 1,200 12,000 12,000 10,376 20.0% 9,172 9,000 7,683 800 1,483 1,503 8,000 8,000 4,

  10. Slide 10: Strategic Planning of Land Acquisition at Attractive Value

    Strategic Planning of Land Acquisition at Attractive Value  As of Dec 31, 2017, cultivating 5 metropolitan areas with a footprint in 19 cities  As of Dec 31, 2017, the land bank was approximately 11.8 mn sq.m. with the average land cost of RMB5,697 Average Land Land Bank Average Land Land Bank GFA

  11. Slide 11: New Land Bank in FY2017

    New Land Bank in FY2017 Total Avg. land Att. land land Saleable cost cost cost Site area GFA Att. GFA (RMB (RMB (RMB/sq Time City Project type Methodology % (sq.m.) (sq.m.) (sq.m.) mn) mn) .m.) Mar Tianjin Resi Bidding 42% 45,437 54,524 22,900 758 318 13,902 2017 Land Acquisition Apr Tianjin Resi Bi

  12. Slide 12: Establishing Three Popular Product Lines with Craftsmanship

    Establishing Three Popular Product Lines with Craftsmanship  Boutique「 3.5」 Product Mix • Arts：From techniques to arts • Experience：From external to internal First-time Buyer and • Openness：From customers to end users 3 Upgrader + Services 7 Upgrader  Residential buildings with PC system prefabric

  13. Slide 13: Commercial Operations - Regional Expansion in Commercial Business

    Commercial Operations - Regional Expansion in Commercial Business  Commercial business geographically expanded from Xiamen, Quanzhou and Shanghai to Hefei, Hangzhou, Suzhou, Nanjing and Wuhan. Projects in Operation: 14 Projects in Preparation: 8 City of City of Name Business Form Name Business Form

  14. Slide 14: Hotel Operations - Vigorous development & growth

    Hotel Operations - Vigorous development & growth  Focus on the development of serviced apartments as well as medium-to-high-end business hotels to establish premium hotel brands  Develop resort hotels and improve the existing hotel portfolio to strengthen the brand’s core competitiveness Xiamen Yu

  15. Slide 15: Property Management - Rapidly Developing to Boost Brand Premium

    Property Management - Rapidly Developing to Boost Brand Premium  Advocated the philosophy of "Customer First, Service Oriented" to improve service and management systems  Formulated the quality approach of “Sincere Services, Passion for Excellence, Standard Management and Rational Innovation" Our

  16. Slide 16: Expanding Branding Advantages

    Expanding Branding Advantages 2017 Best 50 China Real Estate Listed 2017 Best 50 of China Property HS Composite Large Cap Southbound Trading under the Companies with Strongest Management Enterprises Brand Value Comprehensive Strengths (Rank 36) (Rank 33) & Mid Cap Indexes Shanghai-Hong Kong Stock Co

  17. Slide 17: Building Cities with Heart, Building Homes with Love

    Building Cities with Heart, Building Homes with Love  Practice a sustainable development business model and build cities that are human and environmentally friendly  Create quality life, working and leisure space for people which are up to benchmark standard Yuzhou Charity Foundation My home in Gr

  18. Slide 18: Financial Highlights – Healthy and Stable

    Shanghai ·Noble Mansion Financial Highlights – Healthy and Stable Revenue: RMB21,701 mn (+58.73%)； Core profit: RMB2,924 mn (+42.83%)； Net gearing ratio: 57.73% (including senior perpetual securities 77.14%)； Cash flow strong and stable

  19. Slide 19: Highlights of FY2017 Results

    Highlights of FY2017 Results RMB bn 2017 2016 Changes Contracted sales 40.31 23.21 +73.69% Recognized revenue 21.70 13.67 +58.73% Gross profit margin 35.40% 36.27% -0.87pp Profit for the year 3.13 2.09 +49.73% Core profit 2.92 2.05 +42.83% RMB bn 2017 2016 Changes Total equity 17.44 11.67 +49.44% Ca

  20. Slide 20: Highlights of FY2017 Results (cont'd)

    Highlights of FY2017 Results (cont’d) Increasingly diversified revenue streams, with rising contributions from recurring rental income and property management 100% = RMB 100% = RMB 21,701 mn 13,672 mn RMB mn 2017 2016 Changes 0.1% 0.1% Sales of 1.5% 1.3% 21,214 13,345 +58.96% properties 0.6% 0.9% R

  21. Slide 21: Analysis of Recognized Property Sales

    Analysis of Recognized Property Sales Recognized Property Sales* Recognized GFA & ASP RMB mn GFA ASP ‘000 sq.m. RMB ‘000 / sq.m. 25,000 21,213 1,600 14,118 16,000 20,000 1,200 12,000 15,000 13,345 14,166 2H 800 9,000 8,000 10,158 9,172 1,483 1,503 10,000 9,327 IH 1,107 6,740 400 4,000 5,000 7,047 3,

  22. Slide 22: Strong Balance Sheet

    Strong Balance Sheet Cash Position Total Debt RMB mn RMB mn 30,000 20,000 27,567 17,418 17,498 25,787 25,000 15,000 20,083 11,949 20,000 10,000 15,000 10,000 5,000 5,000 - - FY2015 FY2016 FY2017 FY2015 FY2016 FY2017 Total Assets Total Equity RMB mn RMB mn 100,000 20,000 17,443 79,905 80,000 16,000 6

  23. Slide 23: Strong Balance Sheet (cont'd)

    Strong Balance Sheet (cont’d) Net Debt(a) / EBITDA Net Debt(a) / Total Equity Net Debt(a) / Total Capitalization(b) X % % X X 2.5 100% 30% X 27% 2.1 79% 25% 2.0 80% 77% 72% 22% 22% 1.6 20% 1.5 60% 58% 1.3 15% 1.0 40% 10% 0.5 20% 5% - 0% 0% FY2015 FY2016 FY2017 FY2015 FY2016 FY2017 FY2015 FY2016 FY20

  24. Slide 24: Stable Financial Position and Diversified Financing Channels

    Stable Financial Position and Diversified Financing Channels  Sustained a manageable net gearing ratio, with successful financing measures that further reduced the average funding cost  Moody’s, S&P and Fitch retained our ratings at Ba3, BB- and BB- respectively  Golden Credit Rating Internationa

  25. Slide 25: FY2017 Cash Position

    FY2017 Cash Position （RMB bn） FY2017 FY2018E Cash inflow Cash proceeds from contracted sales and other income +28.0 +42.6 Cash outflow Land premium paid -17.9 -24.3 Construction cost capex -7.0 -9.0 Other expenses - Interest, tax, dividends and others -8.1 -9.9 25

  26. Slide 26: Future Perspective

    Shanghai ·Yuzhou Mansion Future Perspective – Grasping the opportunities to a prospective future

  27. Slide 27: Market Outlook

    Market Outlook  Markets have gradually priced in the expectation of property tax being implemented  Considering the interests of  Quality real estate society, the government will play a enterprises with high coordinating role in establishing a profitability and low more comprehensive tax collecti

  28. Slide 28: Strategies for 2018

    Strategies for 2018 Profit Scale Risk 28

  29. Slide 29: A RMB100bn Journey Begins

    A RMB100bn Journey Begins  Total land bank : 15mn+ sq.m.  Confident to achieve RMB100bn+ by 2020  Total saleable resources：RMB300bn+  CAGR targets to exceed 40% for contracted sales  National layout in 23 cities 1,000 + Contracted Sales 600 403 120 140 232 ··· FY2014 FY2015 FY2016 FY2017 FY2018

  30. Slide 30: Management

    Gradually Develop a 3-Layer Management Mode Lay a Sound Foundation for Further Strategic Targets Headquarters of Yuzhou Central China Regional South China Regional West Strait Regional East China Regional Bohai Rim Regional Hotel Operation Management Commercial Company Property Company Company Compa

  31. Slide 31: Key Projects in 2018

    Key Projects in 2018 Hangzhou Yuzhou·Riverside Sapphire Shanghai Yuzhou Noble Mansion (杭州禹洲·濱之江) (上海禹洲·雍賢府) • Located in Zhijiang, Hangzhou • The center of the south area of West Lake District, and being Qiantan, gifted with the largest connected by Zhijiang bridge and wild wetlands / Central Park i

  32. Slide 32: Key Projects in 2018 (cont'd)

    Key Projects in 2018 (cont’d) Suzhou Yuzhou Zhaoshang The Absolute Wuhan Taizi Lake Project (蘇州 禹洲招商拾鯉花園) (武漢 太子湖項目) • Located in Suzhou’s Xiangcheng • Located in Wuhan’s economic district, which will include an and technological development industrial park, lake scenic park and zone, on the Jiangch

  33. Slide 33: Appendix

    Nanjing ·Moon Riverside Appendix

  34. Slide 34: Xiamen Real Estate Market Overview

    Xiamen Real Estate Market Overview '000 sq.m. Residential Land Supply and Property Transactions – Xiamen RMB/sq.m. 5,000 4,777 35,000 4,490 34,375 28,769 30,000 4,000 3,516 3,144 26,518 25,000 25,658 3,000 2,622 20,535 2,731 20,000 2,246 11,972 13,905 13,482 19,848 2,131 2,000 11,532 1,655 1,586 1,5

  35. Slide 35: Fuzhou Real Estate Market Overview

    Fuzhou Real Estate Market Overview '000 sq.m. Residential Land Supply and Property Transactions – Fuzhou RMB/sq.m. 4,000 3,791 35,000 3,483 3,500 3,023 30,000 2,905 2,764 3,000 2,524 2,652 25,000 2,410 2,438 2,326 2,500 2,177 21,636 1,875 20,000 2,000 1,766 14,910 16,879 1,501 15,000 1,500 16,372 16

  36. Slide 36: Shanghai Real Estate Market Overview

    Shanghai Real Estate Market Overview '000 sq.m. Residential Land Supply and Property Transactions – Shanghai RMB/sq.m. 18,000 60,000 16,000 14,989 14,328 14,973 13,917 50,000 14,000 12,800 47,865 11,554 11,247 12,000 10,1379,713 38,283 40,000 9,827 9,342 10,000 7,278 32,001 30,000 8,000 6,476 6,392

  37. Slide 37: Hefei Real Estate Market Overview

    Hefei Real Estate Market Overview '000 sq.m. Residential Land Supply and Property Transactions – Hefei RMB/sq.m. 25,000 14,000 21,566 11,178 12,000 20,000 18,732 12,666 16,620 8,839 10,000 8,500 15,000 12,319 13,837 8,000 6,854 6,472 7,672 12,682 11,800 10,805 9,240 9,211 6,581 10,000 8,167 6,722 9,

  38. Slide 38: Nanjing Real Estate Market Overview

    Nanjing Real Estate Market Overview Residential Land Supply and Property Transactions – Nanjing RMB/sq.m. '000 sq.m. 15,860 25,000 21,601 15,000 18,913 20,000 13,278 12,787 11,691 10,001 15,140 15,452 14,804 9,193 13,804 9,768 15,000 10,000 8,629 8,615 9,433 8,869 7,708 7,029 12,252 7,194 10,000 10,

  39. Slide 39: Hangzhou Real Estate Market Overview

    Hangzhou Real Estate Market Overview '000 sq.m. Residential Land Supply and Property Transactions – Hangzhou RMB/sq.m. 20,000 18,673 22,987 25,000 14,898 15,109 20,000 15,000 17,313 15,484 12,867 14,581 16,663 11,975 16,619 10,275 15,000 15,878 15,900 10,000 8,197 8,663 8,903 13,424 6,561 7,079 7,41

  40. Slide 40: Suzhou Real Estate Market Overview

    Suzhou Real Estate Market Overview '000 sq.m. Residential Land Supply and Property Transactions – Suzhou RMB/sq.m. 14,000 12,677 25,000 11,763 12,000 10,481 9,659 9,836 18,621 20,000 10,000 9,326 9,671 8,675 8,716 8,089 7,701 7,893 8,000 12,329 17,355 15,000 6,411 12,116 6,000 13,163 13,251 10,000 4

  41. Slide 41: Wuhan Real Estate Market Overview

    Wuhan Real Estate Market Overview '000 sq.m. Residential Land Supply and Property Transactions – Wuhan RMB/sq.m. 44,028 11,000 9,432 10,031 40,000 10,000 9,000 7,430 7,796 8,000 7,152 7,093 8,810 28,798 30,000 27,518 7,000 24,864 22,082 23,537 21,468 6,000 5,060 20,000 16,255 17,993 18,263 5,000 14,

  42. Slide 42: Tianjin Real Estate Market Overview

    Tianjin Real Estate Market Overview '000 sq.m. Residential Land Supply and Property Transactions – Tianjin RMB/sq.m. 30,000 25,940 15,670 25,000 13,458 23,321 15,000 20,000 11,546 10,553 9,347 10,061 16,807 10,218 10,315 14,967 10,000 15,000 13,561 14,207 13,786 12,596 11,819 9,566 8,796 11,054 10,0

  43. Slide 43: FY2017 Key Financials

    FY2017 Key Financials FY2017 FY2016 Changes Revenue (RMB’000) 21,700,673 13,671,828 +58.73% Gross profit (RMB’000) 7,683,054 4,958,912 +54.93% Gross profit margin (%) 35.40% 36.27% -0.87pp Core profit (RMB’000) 2,923,989 2,047,126 +42.83% Core profit margin (%) 13.47% 14.97% -1.50pp EPS (RMB/share)

  44. Slide 44: FY2017 Key Financials (cont'd)

    FY2017 Key Financials (cont’d) As at 31 Dec 2017 As at 31 Dec 2016 Changes (RMB’000) Total assets 79,904,817 68,860,512 +16.04% Total liabilities 62,461,581 57,187,776 +9.22% Total equity 17,443,236 11,672,736 +49.44% Total cash 17,498,208 17,417,534 +0.46% Total debt 27,567,486 25,786,793 +6.91% Ne

  45. Slide 45: 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

  46. Slide 46: Q&A Thank you!

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