Csi Properties Limited · HKEX:497
Csi Properties — Investor Presentation (February 2014)
40 slides from Csi Properties's investor presentation, February 2014
Slide 1: Corporate Presentation Feb 2014
Corporate Presentation Feb 2014 (497.HK)
Slide 2: Disclaimer
Disclaimer The information contained in this presentation is provided by CSI Properties Limited (the "Company") for reference purposes only, and should not be relied upon for the purpose of making any investment decision or for any other purpose whatsoever. The information contained in this presenta
Slide 3: Executive Summary
Executive Summary Mr. Mico Chung, Chairman, acquired control of the Company in 2004 as a platform to expand his property investment business One of the fastest growing property investment/ development companies in Greater China in the past 10 years and a constituent stock of the MSCI Small Cap H
Slide 4: Our Investment Properties Business Model
Our Investment Properties Business Model – Profitable Strategic Repositioning of Properties Identify Acquire Execute Exit Stabilize Execute Value Rental Yield Enhancement Strategy Formulate Repositioning Plan Strength in Acquiring Properties – Result of High Value Added Capital Expertise and Appreci
Slide 5: Proven Track Record and Superior Investment Return
Proven Track Record and Superior Investment Return Selling Major Projects (up until Mar 2013) Cost Price Increase IRR (HK$’m) (HK$’m) (%) (%) Paul Y. Centre, Kwun Tong (2006-07) 780 1,150 48% 178 - renovation & tenants repositioning No. 88 Gloucester Road, Wanchai (2003-07) 196 783 300% 65 - renovat
Slide 6: Focused Strategy to Capture High Growth Potential in China
Focused Strategy to Capture High Growth Potential in China CSI started operation in Shanghai in 2006 in view of the tremendous potential for China market and led by experienced management team under Ms. Dong Yan Capturing the long term growth potential in China that’s well supported by macro eco
Slide 7: Our Premium Lifestyle Residential Division
- Our Premium Lifestyle Residential Division As a commitment to our positioning on tailor-made, premium lifestyle residential property development, we have rebranded our residential development division under the brand “COUTURE HOMES” Going forward will focus on premium residential development i
Slide 8: The Origin of Couture Homes
The Origin of Couture Homes Purchased a detached houses complex in Tai Tam from a Singapore fund in 2006 for a total of HK$330m (incl. renovation) Working with the award-winning designer team led by Steve Leung, these houses were completely redesigned and furnished with bespoke furnishings and d
Slide 9: Couture Homes as the Key Growth Driver
Couture Homes as the Key Growth Driver The Hampton epitomizes the superior quality of our residential units by combining world-class design concepts together with use of bespoke furniture, fabrics, rugs, vanished wood panels, wall decoration and leather upholstery to set new standards of quality a
Slide 10: Experienced and Disciplined Management Team
Experienced and Disciplined Management Team Group Senior Management Mr. Mico Chung (Chairman and Executive Director of CSI) Mr. Chung acquired control of the Group in 2004 as a platform to expand his property investment business. Mr. Chung graduated from University College, University of London and
Slide 11: Experienced and Disciplined Management Team
Experienced and Disciplined Management Team Investment Property Division Mr. Wong Chung Kwong (General Manager of Hong Kong Investment Property Division and Executive Director of CSI) Prior to joining the Group in 2004, Mr. Wong has over 30 years’ experience in the local and mainland real estate mar
Slide 12: World-Class Architectural and Interior Design Strength
World-Class Architectural and Interior Design Strength COUTURE HOMES (“CH”) – Premium Lifestyle Residential Development Division Mr. Jimmy Fong (Executive Director of CSI and Managing Director of CH - Sales and Marketing Division) Prior to joining the Group in 2011, Mr. Fong has over 20 years solid
Slide 13: Pro-forma Balance Sheet Adjusted for Market Valuation
Pro-forma Balance Sheet Adjusted for Market Valuation Net Asset Value (HK$’m) Net assets attributable to Shareholders (audited) 7,064 Add: Attributable revaluation surplus relating to the Group’s properties held for sale as per independent valuations 2,800 at 31 March 2013* Attributable revaluation
Slide 14: Strong Commitment of Controlling Shareholder
Strong Commitment of Controlling Shareholder Public Shareholders Mico Chung (53.8%) (46.2%) Shareholding interests based on 9,518 million, the total number of outstanding shares • Mr. Chung recently completed his annual 2% purchase limit in Apr 2013 to take his ownership interest to 46.2% stake in C
Slide 15: Recent Key Corporate Activities Highlights
Recent Key Corporate Activities Highlights • Completed a placement exercise through CLSA Capital Markets Limited and JPMorgan Securities to raise approximately US$50 million in October 2012 • The placement proceeds further strengthen the balance sheet of the company and provide the funds for necessa
Slide 16: Awarded Best Small Cap Company in Hong Kong
Awarded “Best Small Cap Company in Hong Kong” • The Group was awarded the “Best Small Cap Company in Hong Kong” in Asia's Best Managed Companies annual poll conducted by FinanceAsia, the leading financial journal in the Asia Pacific region • FinanceAsia has organised the annual poll to select Asia’s
Slide 17: Our Future Goal
Our Future Goal Investment Properties Couture Homes • Commitment to detailed design and top quality finishing, tailored made to aim at • Continue to leverage on established pre-targeted class of lifestyle oriented market strengths and network to identify end-users willing to pay a premium and invest
Slide 18: Massive Upside Potential in Valuation through Stock Re-rating
Massive Upside Potential in Valuation through Stock Re-rating Type of Business Share Price vs NAV Major property developers Close to NAV or slight premium Major property investors 20% - 40% discount Mid-cap property companies 30% - 40% discount CSI Approx. 70% discount • Our current capital structur
Slide 19: Why CSI Properties
Why CSI Properties Proven Track Record Value enhancement model generates average annualized IRR of 60% and Performance since inception Combining the repositioning of investment properties for value Profitable Twin Driver enhancement and premium “tailor-made life-style” residential Business Model pro
Slide 20: Disposal Pipeline Prospects - List of Major Properties
Prospects - List of Major Properties Current/ Gross Area Market Book Date of Committed Occupancy Portfolio information * (approx) Value(1) Value Purchase Annual Rent (%) sq ft (‘000) (HK$’m) (HK$’m) (HK$’m) Investment Property G/F, 1506-07,17-23F, Skysign, 78 carparks of Aug ‘06 / Wanchai 124 2,197
Slide 21: Q & As
* ASIA’S CSI Best SH PROPERTIES COMPANIES a s+ & & COUTURE HOMES 2013 Mm OR eS Best Small-Cap CSI Properties
Slide 22: Appendix 1: 1H FY2014 Results Highlights
Appendix 1: 1H FY2014 Results Highlights
Slide 23: 1H FY 2014 Interim Results Highlights
1H FY 2014 Interim Results Highlights (Period ending 30 Sep 2013) (HK$’m) 1H FY2014 1H FY2013 % change (A) (B) (A/B-1) Gross Revenue from 2,164 793 173% property business - property sale 2,060 684 - rental income 104 109 Gross Profit 694 478 45% Profit from Property 41 16 156% JV/ Associates Profit
Slide 24: FY 2014 YTD Key Disposals
FY 2014 YTD Key Disposals Project Selling Price (HK$m) H8, 8 Hau Fook Street TST 668 2 units of the Hampton Happy Valley 160 Le Diamant, Mongkok 1,029 703-705 Nathan Road One floor of Enterprise Square Kowloon Bay 284 Presale of c.120 units at the Causeway Bay c. 1,800 yoo Residence* 23rd Floor of A
Slide 25: FY 2014 Interim Results Highlights
FY 2014 Interim Results Highlights (HK$’m) Interim FY 2014 FY 2013 30th Sep 2013 31st Mar 2013 Properties & related assets 7,816 7,433 Cash & bank balances 2,257 3,132 Investments 1,580 752 Other assets 155 173 TOTAL ASSETS 11,808 11,490 Bank loans 2,654 2,707 Notes 1,170 1,170 Other liabilities 421
Slide 26: Interim FY 2014 Financial Highlights
Interim FY 2014 Financial Highlights 1H FY 2014 FY 2013 (HK$m) (HK$m) Book NAV attributable to Shareholders 7,556 7,064 Pro-forma adjusted NAV attributable to 10,529 10,530 Shareholders Net debt 1,568 745 Investments* 1,580 752 Current ratio 6.64x 6.09x Gearing ratio (consolidated) 32.4% 33.7% Geari
Slide 27: Appendix 2: Details of Key Investment and Residential Property Projects
The Hampton Appendix 2: Details of Key Investment and Residential Property Projects Yoo Residence
Slide 28: Key Current Investment Projects
Key Current Investment Projects AXA Centre, Wanchai Grade-A office located on 151 Gloucester Road with prime harbour view Currently still hold 7 top floors (17th -23rd floors), sky-sign, ground floor and 75 car parking spaces, after sale of the basement and 24th floors Tenants include AXA Insu
Slide 29: Key Current Investment Projects
Key Current Investment Projects Novotel Hotel Jordan Acquisition of 50% interest of Novotel Hotel Jordan for HK$2.4 billion completed end of July 2012 GFA of approximately 290,000 sq.ft. with 389 hotel rooms and prime shopping space Estimated gross entry yield of 5.5% and targeting yield of 7.
Slide 30: Key Current Investment Projects
Key Current Investment Projects Platinum, Shanghai Grade-A prime office building with 20 storeys located on Taicang Road near XianTianDi in Shanghai Majority of tenants are multi national corporations including the likes of McKinsey (China’s headquarter), Standard Chartered Banks and LG Group et
Slide 31: Couture Homes – Key Current Projects
Couture Homes – Key Current Projects The Hampton, Happy Valley (All Sold) Successful sale of 8 uniquely-themed and furnished luxury units for a combined total of HK$807 million set the foundation for Couture Homes Combination of design concepts from world renowned designers and use of bespoke fu
Slide 32: Couture Homes – Key Current Projects
Couture Homes – Key Current Projects Barker Road, The Peak Acquired the heritage site at 47 Barker Road in February 2011 at HKD204 million A rare land lot at Barker Road in the ultra premier residential area at the Peak The house will be redesigned and refurbished and will blend in with its hi
Slide 33: Couture Homes – Key Current Projects
Couture Homes – Key Current Projects Qing Pu Villas, Shanghai Acquired 50% interest in June 2011 for a prime residential site in the luxurious villa district in Qing Pu District, Shanghai GFA of approximately 650,000 sq.ft. Only 15 minutes driving distance from the Hong Qiao International Airp
Slide 34: Couture Homes – Key Current Projects
Couture Homes – Key Current Projects Kau To Shan, Shatin Acquisition of Kau To Shan land site through government tender in May 2012 G.F.A. of approximately 50,000 sq. ft. for a cost of HK$531m Plans to develop into around 20 luxury villas of approximately 2,500 sq.ft. each with its own private
Slide 35: Appendix 3: Case Studies
Appendix 3: Case Studies
Slide 36: Ongoing Case Example: Novotel Nathan Road Hotel
Ongoing Case Example: Novotel Nathan Road Hotel Novotel Hotel 4-star hotel in prime district in Kowloon Room for improvement in hotel rates Opportunity Underperformance in shopping arcade rental identified Acquired property with Gaw Capital Partners in Aug 2012 Targeting rental yield impro
Slide 37: Ongoing Case Example: Monterey Court, Jardine's Lookout
Ongoing Case Example: Monterey Court, Jardine’s Lookout Prime residential tower at Jardine’s Lookout, renowned Monterey Court (rendering) Opportunity high-end residential district in Hong Kong popular to tycoons identified Acquisition price at HK$19,000 psf for the site with a gross floor area o
Slide 38: Success Case Example: Mohan Building
Success Case Example: Mohan Building Building exterior 12-storey office building situated at the heart of Tsim Sha Tsui shopping district leased to SMEs Before renovation After renovation and trading firms Opportunity identified Poorly managed, mismatched location and positioning Acquired prop
Slide 39: Success Case Example: AXA Centre
Success Case Example: AXA Centre Headquarter of AXA Insurance with sweeping Lift lobby view of Victoria Harbour Opportunity Acquired 51% interest from AXA Insurance in Aug Before renovation After renovation identified 2006 and subsequently increased ownership to c.90% in 2007 Total acquisition
Slide 40: Success Case Example: The Hampton, Happy Valley
Success Case Example: The Hampton, Happy Valley The Hampton Acquired the whole building with 15 units in May 2008 for HK$290mm (HK$7,800 psf) from Nan Fung Development Spent HK$170mm to substantially rebuild and convert existing15 units into 11 larger sized apartment units All-in cost of HK$12
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