Yuzhou Group Holdings Co., Ltd. · HKEX:1628
Yuzhou — Yuzhou Properties Company — H1 2013 Earnings Presentation
40 slides from Yuzhou's earnings presentation, Aug 29, 2013
Slide 1: 2013 Interim Results Announcement
2013 Interim Results Announcement 29 August 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: About Presenters
ABOUT PRESENTERS Founder, Mr. LAM, Lung On Chairman and Executive Director Chief Financial Officer and Mr. Steve CHIU Company Secretary Senior Manager of Ms. Emily Sze Corporate Finance & Investor Relations Senior Manager of Ms. Venus Chiu Corporate Finance & Investor Relations 3
Slide 4: Table of Contents
TABLE OF CONTENTS I. FINANCIAL HIGHLIGHTS II. BUSINESS REVIEW III. FUTURE PERSPECTIVES IV. APPENDIX 4
Slide 5: Financial Highlights
(3 Fa OY Tb BE A 133 BRS] ota YUZHOU PROPERTIES COMPANY LIMITED Stock Code: 01628.HK FINANCIALHIGHLIGHTS
Slide 6: 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 7: 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 8: 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 9: 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 10: 1H2013 Key Balance Sheet Items
1H2013 KEY BALANCE SHEET ITEMS Cash Position Total Debt RMB million RMB million 4,631 8,226 7,509 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 11: 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 2009 2010 2011 2012 1H2013 45 17 Debt Profile by Currency Debt Profile by Type % % 35 Fixed US$ interest rate HK$ 53 Floating RMB intere
Slide 12: Business Review
(3 Fa OY Tb BE A 133 BRS] ota YUZHOU PROPERTIES COMPANY LIMITED Stock Code: 01628.HK BUSINESS REVIEW 12
Slide 13: 1H2013 Contracted Sales +50% Year-on-Year
1H2013 CONTRACTED SALES +50% YEAR-ON-YEAR Contracted Sales Interest in Contracted As of Contracted Contracted # Project Project Sales Total GFA ASP (FY2011 vs. FY2012vs. 1H2013) City % (RMB mn) (%) (sq.m.) (RMB/sq.m.) RMB million Yuzhou University City Phase 1 Xiamen 100% 7 0% 542 12,424 II 6,529 Yu
Slide 14: Monthly Contracted Sales in 2012 vs. 2013
MONTHLY CONTRACTED SALES IN 2012 vs. 2013 Monthly Contracted Sales ( Jan 2012 – Jul 2013) Contracted Sales ASP (RMB’million) (RMB/sq.m.) 2,500 2,410 16,000 14,000 2,000 13,799 11,501 12,000 10,531 10,407 9,907 9,815 9,226 9,637 1,500 8,836 8,687 8,576 9,044 10,000 8,915 8,704 8,983 8,691 1,263 8,000
Slide 15: 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 16: Snapshot of Land Bank
SNAPSHOT OF LAND BANK 8.40million sq.m. as at June 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 517 5 1,631 6 Yangtze Hefei 2,039 3 1,042 24 River Delta Tianjin Bengbu 668 1 660 8 Xiamen 2,547 21 2
Slide 17: Land Replenishment in 2013
LAND REPLENISHMENT IN 2013 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 918,698 1,306 1,421 Apri
Slide 18: Ability to Obtain Sustainable Project Finance
ABILITY TO OBTAIN SUSTAINABLE PROJECT FINANCE 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 1,200 630 570 4 BOC Xiam
Slide 19: Less Selling General and Administrative Expenses
LESS SELLING GENERAL AND ADMINISTRATIVE EXPENSES 1H2013 1H2012 Change % as of % as of % as of RMB million Contracted RMB million Contracted RMB million Contracted sales sales sales Selling Cost 57.0 1.0% 45.8 1.2% 24.5% -0.2pp Admin Expenses 97.0 1.7% 73.0 1.9% 32.9% -0.2pp Total SG&A 154.0 2.7% 118
Slide 20: 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% 80% 31% 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 21: 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 22: Future Perspectives
(3 Fa OY Tb BE A 133 BRS] ota YUZHOU PROPERTIES COMPANY LIMITED Stock Code: 01628.HK FUTURE PERSPECTIVES 22
Slide 23: 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 24: 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 25: 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 26: 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 27: 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 28: Major Completion Projects in 2H2013
MAJOR COMPLETION PROJECTS IN 2H2013 Completion GFA Presold GFA as of June Presales as of June Project Name 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 211,736 154
Slide 29: Market Leadership in Xiamen, Fujian Province
MARKET LEADERSHIP IN XIAMEN, FUJIAN PROVINCE 3 Largest land bank in Xiamen among major listed developers* m sq.m. 2.50 2.13 Fuzhou 2.00 5 1.71 1.50 2 Quanzhou 1.00 0.87 0.77 0.55 Average: 0.60 0.50 0.45 0.42 0.30 6 0.23 Xiamen 4 1 0.08 0.00 Yuzhou Vanke Shimao BCDC Longfor Mingfa COLI SCE CR Land Po
Slide 30: 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 31: Appendix
(3 Fa OY Tb BE A 133 BRS] ota YUZHOU PROPERTIES COMPANY LIMITED Stock Code: 01628.HK APPENDIX 31
Slide 32: 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 33: 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 8,000 5,813 5,634 4,000 3,976 6,000 5,138 4,263 5,363 2,981 4,400 3
Slide 34: 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 20,128 18,999 7,76717,941 17,776 10,000 15,000 16,914 16,1
Slide 35: 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 8,439 2,799 2,874 7,754 6,000 3,000 6,256 6,339 6,3
Slide 36: 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 37: Diversifying Land Bank
DIVERSIFYING LAND BANK As at 31 Dec 2012 As at 30 Jun 2013 By City By City % 7 % 5 Xiamen 6 Xiamen 8 Fuzhou 8 30 39 Fuzhou Quanzhou 17 Quanzhou Longyan Hefei Longyan 24 4 5 Shanghai Zhangzho 5 Tianjin 3 4 16 u 19 By Project Type By Project Type % 10 % 11 4 4 Residential Residential Hotel & Office Ho
Slide 38: 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 39: 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 40: 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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