Shui On Land Ltd. · HKEX:272
Shui On Land — ESG Presentation (June 2021)
53 slides from Shui On Land's sustainability presentation, June 2021
Slide 1: Sustainable Development and ESG Strategies
Confidential SHUI ON LAND LIMITED Incorporated in the Cayman Islands with limited liability Stock code 272 Sustainable Development and ESG Strategies June 2021
Slide 2: Table of contents
Table of contents Section 1 Business and strategic overview 2 Section 2 Sustainable development strategy and ESG 12 Section 3 Financial highlights and latest developments 31 Appendix Other information 45 1
Slide 3: Business and strategic overview
Section 1 Business and strategic overview
Slide 4: Group overview
Group overview Established in Hong Kong in 1971 with 50 years of history, the Shui On Group entered the Chinese Mainland market in 1984 Headquartered in Shanghai, Shui On Land ("SOL") was established in 2004 under the Group and is the flagship property development company with China Xintiandi and
Slide 5: Company history
Company history Over 37 years of real estate development and investment experiences in China Acquired development Acquired development Construction of Shanghai Shui On Land Ltd established rights for Rui Hong Xin rights for the Hualongqiao Shui On Group Cheng and Taipingqiao Xintiandi North Block
Slide 6: International recognitions
International recognitions Our projects have received the highest industry recognitions for their design, planning and cultural attributes North Block of Xintiandi was the first project in China to receive ULI Excellence Award in 2003 The Taipingqiao Xintiandi project was listed as a successful
Slide 7: Existing landbank
Existing landbank We currently have an existing landbank of 8.6 million sq m. in buildable GFA Total landbank: 8,600,000 sqm Commercial portfolio in Shanghai: Nanjing Shanghai Leading second-tier city in the Yangtze Total GFA:1.72 million sqm River Delta with diversified industrial One of
Slide 8: Leading commercial property owner and operator in Shanghai
Leading commercial property owner and operator in Shanghai With a total GFA of 1.7 million sq m across 6 major developments KIC Hong Shou Fang 5 Corporate Avenue & HUBINDAO Hall of the Sun, KIC Ruihong Corporate Avenue Yang Pu Wujiaochang Xuhui THE HUB North Hong Shou Fang RHXC Bund Bund West Jingan
Slide 9: Commercial portfolio in Shanghai
Commercial portfolio in Shanghai Strong portfolio of commercial properties, with total asset value (GAV) of approximately RMB77 billion Office Retail Total Attributable Asset Value Completed % of GFA GFA GFA GFA as of 31 Dec 2020 Key Projects ownership sq.m. sq.m. sq.m. sq.m. RMB’ bn Shanghai Xintia
Slide 10: Notable developments
Notable developments Shanghai Taipingqiao (Xintiandi) development Taipingqiao, located in Huangpu, Shanghai, is Shui On Land’s first large-scale, city-center master-planned community project Master-planned by SOM Co., Ltd. in 1996 with a total GFA of 1,589,423 sq.m. Comprised of several main c
Slide 11: Residential development saleable resources
Residential development saleable resources RMB64 billion saleable resources from current landbank as of 31 December 2020 Approximate saleable Estimated gross saleable Estimated attributable The Group’s interests Project name residential GFA resources sales % sq.m. RMB’ bn RMB’ bn Shanghai Taipingqia
Slide 12: Commercial development
Commercial development Strong pipeline of commercial properties in Shanghai and other cities for rental growth and capital recycling List of Commercial Properties Under Development and For Future Development as of 31 December 2020 (Excluding sites yet to commence relocation) Office Retail Total The
Slide 13: Sustainable development strategy and ESG
Section 2 Sustainable development strategy and ESG For full details on our SD and ESG initiatives, please download the “SOL 2020 Sustainable Development Report” on our website: https://www.shuionland.com/en-us/csr/Sustainable_development_report
Slide 14: Our vision
Our vision To become a pioneer of sustainable premium urban communities 2030 5C CULTURE JAN – MAR Sustainable Development Strategy JAN – JAN – CORPORATE CARE MAR MAR GOVERNANCE JAN – JAN – MAR1 COMMUNITY CLEAN MAR 13
Slide 15: SOL sustainable development history
SOL sustainable development history Longstanding commitment to sustainability since our initial development days 1997 2012 2016 2017 2021 Masterplanning began of Announced our first Started to Launched the updated Six Major Became the first Taipingqiao, a pedestrian Six Major Guidelines disclose ESG
Slide 16: The 5C Sustainable Development Strategy
The 5C Sustainable Development Strategy Launched in 2020, our latest 10-year 5C Strategy points the way for our sustainable future, with ambitions that are interconnected and collectively contribute to our corporate vision CLEAN Transition towards carbon neutrality, leading with climate change mitig
Slide 17: The 5C Sustainable Development Strategy (cont'd)
The 5C Sustainable Development Strategy (cont'd) Our 10-year strategy outlines our goals, with key targets set for 2030 CLEAN COMMUNITY CULTURE CARE Ambition Ambition CARE Ambition Ambition Transition towards carbon For all our communities to Enhance the vibrancy and Provide all employees with equal
Slide 18: Clean
Clean Priority areas to achieve our ambition of carbon neutrality Transition towards carbon neutrality AMBITION Build green and Transition towards carbon neutrality, leading with healthy communities climate change mitigation and Reduce waste adaptation practices and by in our portfolio increasing ou
Slide 19: Clean – Progress on sustainability certifications
Clean – Progress on sustainability certifications SOL has the greatest building area awarded LEED-ND Stage 2 Gold level certification among developers in mainland China COMMUNITY LEVEL SD CERTIFICATIONS Master-planning projects: LEED-ND Stage 2 Gold: Taipingqiao total GFA of 9,050,000 m2 Chongqing
Slide 20: Clean – Progress on health certifications
Clean – Progress on health certifications Healthy Community and Healthy Building certifications WELL Community Xintiandi Community (2019.11, Silver, First WELL certified community globally) WELL building SOL Headquarter (2020.09, Platinum) Chinese Healthy Building Label: RH Lot1 residential (2020.08
Slide 21: Clean – Progress on carbon emissions reduction
Clean – Progress on carbon emissions reduction The first China-based company in the Real Estate sector to commit to Science Based Targets initiative Carbon emissions historical data 2011-2020 SOL group average Scope 1 and 2 GHG emissions intensity (kg/m2) yoy -6.1% +4.9% -10.5% -6.2% -10.0% -3.8% -0
Slide 22: Community
Community Priority areas to achieve our ambition of healthy and sustainable communities Strengthen an Enhance innovative and Embed health and partnerships and entrepreneurial AMBITION sustainability into engagement for ecosystem For all our communities to our online- encourage and enable healthy, me
Slide 23: Community – Nine principles of SOL masterplan development
Community – Nine principles of SOL masterplan development Renowned masterplan development approach that develops integrated and holistic communities while providing sustainable urban regeneration solutions Community-scaled urban development Mixed use communities Good linkage to transit Pedes
Slide 24: Community – Progress on plant-based initiative and Green Pledge
Community – Progress on plant-based initiative and Green Pledge We are engaging tenants and customers in low carbon living and promoting healthy and sustainable lifestyles by rolling out a plant-based foods initiative starting from SH XTD and later across our portfolio Sign MOU with GREEN MONDAY
Slide 25: Culture
Culture Priority areas to achieve our ambition of vibrancy and authenticity Promote Engage, connect, international AMBITION and promote local cultural diversity Enhance the vibrancy and creativity with authenticity of our and exchange future business communities through urban Rejuvenate opportunitie
Slide 26: Culture – Progress on Creators 100 programme
Culture – Progress on Creators 100 programme Launching of the Creators 100 programme and other special courses with Tongji CAUP In celebration of the 20th anniversary of Xintiandi, we are launching the Creators 100 programme to CREATORS 100 showcase Chinese creative talent with the core principles o
Slide 27: Care
Care Priority areas to achieve our ambition of equal opportunities and diversity of thought and innovation AMBITION Improve Provide all employees employee with equal opportunities for Provide equal Create a Ensure health wellbeing holistic career development opportunities diverse and and safety thro
Slide 28: Corporate governance
Corporate governance Priority areas to achieve our ambition of integrity, transparency and accountability Strengthen emergency AMBITION preparedness Become a leader in corporate Steer the business governance by nurturing a with integrity corporate culture of integrity, Embed transparency, and sustai
Slide 29: Key achievements in 2020
Key achievements in 2020 Our efforts have resulted in measurable impacts, and have been recognised through various certifications and awards Hang Seng Corporate Sustainability Index Series: Became a constituent of the index series in 2020 15% 41% MSCI ESG Leaders Index Series: decrease in Scope 1 &
Slide 30: Key achievements in 2020 (cont'd)
Key achievements in 2020 (cont'd) Market-oriented method to engage investors in our sustainable development efforts, with the re-opening of our inaugural senior green bond in 2020 and the publication of our first Green Bond Report US$300mn debut green bond in November 2019 US$300m raised in 2019 hav
Slide 31: SOL SD governance
SOL SD governance Board-level Sustainability Committee to ensure alignment of the 5C strategy The Group updated SD Governance structure in April 2021. Board of The main adjustment was the addition of a Directors board-level Sustainability Committee consisting of a select group of executive direc
Slide 32: Financial highlights and latest developments
Section 3 Financial highlights and latest developments
Slide 33: FY 2020 financial highlights
FY 2020 financial highlights A year of two halves: 2020 can be characterized as a year of two halves. In the first half of 2020 (“1H 2020”), our businesses experienced significant impact from the COVID-19 outbreak, leading to a substantial decline in the fair value of the Group’s investment proper
Slide 34: FY 2020 financial highlights (cont'd)
FY 2020 financial highlights (cont'd) The Group’s revenue for 2020 totaled RMB4,597 million, compared to RMB10,392 million in 2019. Net loss attributable to shareholders was RMB740 million. The decline was driven mainly: i) an approximately 4% downward revaluation of the Group’s investment propert
Slide 35: Financial summary: 1H vs. 2H 2020
Financial summary: 1H vs. 2H 2020 1H 2020 2H 2020 % Variance 2020 Grand total rental and related income (RMB’mn) 1,1921 1,3361 12% 2,5281 Contracted sales (RMB’mn) 6,222 14,962 140% 21,184 Subscribed sales (RMB’mn) 9,201 4,914 (47%) 4,914 Selected Financial Information (RMB’mn) Revenue 1,450 3,147 1
Slide 36: Income statement
Income statement RMB’mn 2020 2019 Change % Revenue of the Group 4,597 10,392 (56%) Property sales 1,448 7,176 (80%) Rental & related income 2,084 2,251 (7%) Hotels, construction and others 1,065 965 10% Cost of sales (2,247) (5,079) (56%) Gross profit 2,350 5,313 (56%) Gross profit margin 51% 51% -
Slide 37: Income statement (cont'd)
Income statement (cont'd) RMB’mn 2020 2019 Change% (Loss)/profit before tax (415) 3,855 (111%) Tax 182 (1,310) (114%) (Loss)/profit for the year (233) 2,545 (109%) Attributable to: Non-controlling shareholders of subsidiaries 189 228 (17%) Owners of perpetual capital securities 269 269 - Owners of c
Slide 38: Total recognised property sales
Total recognised property sales1 RMB’mn 2020 2019 Change % Shanghai Taipingqiao - 3,326 (100%) Shanghai RHXC 331 703 (53%) Foshan Lingnan Tiandi 1,006 1,456 (31%) Chongqing Tiandi 35 116 (70%) Car Parks 76 305 (75%) Shanghai RHXC - Residential Inventories (Lots 1 & 7) - 1,270 (100%) Total property s
Slide 39: YTD 2021 contracted and subscribed sales
YTD 2021 contracted and subscribed sales Contracted Sales Jan to May Subscribed Sales Total Contracted GFA Sold ASP As of 31 May 2021 Sales RMB million sq.m. RMB/sq.m. RMB million RMB million TPQ 968 5,734 168,699 - 968 RHXC Lot 2 - - - 1 1 RHXC Lot 1 482 4,407 109,366 117 599 Panlong 2,834 46,163 6
Slide 40: Moderate rental income decline due to COVID-19 impact
Moderate rental income decline due to COVID-19 impact Consolidated rental and related income1 Total rental and related income contribution (RMB’mn) 2,573 2,528 Other Cities 23% 2,016 2,2512 1,869 2,0842 1,638 Shanghai 77% Including joint ventures and associates, the total rental & related income d
Slide 41: Valuation of investment property portfolio
Valuation of investment property portfolio Fair value Carrying value Fair value Attributable GFA gain/(loss) in as at 31 Dec gain / (loss) to Project Product value 2020 2020 carrying value sq.m. RMB’mn RMB’mn % RMB’mn Completed investment properties Shanghai Taipingqiao Xintiandi and Xintiandi Style
Slide 42: Financial position as of 31 December 2020
Financial position as of 31 December 2020 RMB’mn 31 Dec 2020 31 Dec 2019 Change % 31 Dec 2018 Change % Total cash and bank deposits 15,796 11,859 33% 15,392 3% Total assets 115,475 108,416 7% 110,250 5% Total debt 36,859 37,741 (2%) 34,269 8% Bank borrowings 20,283 25,823 (21%) 26,321 (23%) Senior n
Slide 43: Net gearing at 45% as at 31 December 2020
Net gearing at 45% as at 31 December 2020 Net Gearing Net Debt (RMB’mn) 37,378 81% 31,556 68% 25,882 24,939 51% 52% 21,063 45% 18,877 40% 2015 2016 2017 2018 2019 2020 2015 2016 2017 2018 2019 2020 42
Slide 44: Debt profile
Debt profile Debt Profile – Nature & Maturity Breakdown 31 Dec 2020 vs. 31 Dec 2019 <1 >1 to >2 to <5 RMB’mn >5 years Total year <2 years years FX Net Debt RMB Senior Notes 2,241 - - - 2,241 RMB Debt, Unhedged, FX Net Debt 33% 30% RMB Debt, Unhedged, 42% USD Senior Notes 4,032 - 9,790 - 13,822 33% H
Slide 45: Balance sheet remains substantively stable
Balance sheet remains substantively stable Strong Asset Base Asset Value – by Nature (RMB’bn) 6% 122.2 160.0 117.2 115.5 114.3 110.3 108.4 108.3 140.0 98.6 120.0 14% 89.6 100.0 68.6 56.3 80.0 42.6 35.9 60.0 29.9 26.0 44% 40.0 20.0 0.0 19% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2
Slide 46: Other information
Appendix Other information
Slide 47: Key performance summary – Environmental
Key performance summary – Environmental1,2 Description Unit 2020 2019 A1.1 Emissions from vehicles NOx 289.633 –4 kg SOx 0.95 1.42 A1.2 Greenhouse gas emissions Scope 1 15,983,770 10,482,469 GHG emissions from stationary combustion Scope 2 kgco2, equivalent 90,328,178 91,483,559 GHC emissions from p
Slide 48: Key performance summary – Environmental (cont'd)
Key performance summary – Environmental (cont'd) KPI Description UNIT 2020 2019 A2.1 Energy consumption and intensity Diesel 536 112 Gasoline 1,849 733 Electricity purchased from grid MWh 106,156 104,196 Natural gas 16,349 18,171 Total energy consumption 124,889 123,212 Intensity of energy consumpti
Slide 49: Key performance summary – Social
Key performance summary – Social KPI Description UNIT 2020 2019 B1.1 Employment by gender Male 1,662 1,705 Female # employees 1,479 1,532 Total 3,141 3,237 B1.1 Employment by contract type Permanent contract 871 –9 # employees Temporary contract 2,265 –10 B1.1 Employment by employment type Full time
Slide 50: Key performance summary – Social (cont'd)
Key performance summary – Social (cont'd) KPI Description UNIT 2020 2019 B1.1 Employee turnover rate by gender Male 21% 23% % Female 17% 20% B1.1 Employee turnover rate by age group Under 30 years 24% 27% 30–50 years % 17% 21% 50 year and above 26% 17% B1.1 Employee turnover rate by geographical reg
Slide 51: Key performance summary – Social (cont'd)
Key performance summary – Social (cont'd) KPI Description UNIT 2020 2019 B3.1 Percentage of employees trained by gender Male 94.5% 91.4% % Female 88.8% 81.3% B3.1 Percentage of employees trained by employee category Senior management 95.9% 78.7% Middle management 96.9% 90.1% % Staff 90.5% 86.5% Oper
Slide 52: Key performance summary – Social (cont'd)
Key performance summary – Social (cont'd) KPI Description UNIT 2020 2019 B5.1 Number of suppliers by geographical region Number of increased Chinese Mainland suppliers 297 405 Number of increased Chinese Mainland contractors 248 189 Suppliers from Hong Kong # 52 –18 Suppliers from China 4,627 4,149
Slide 53: Disclaimer
DISCLAIMER This presentation is confidential and has been prepared by Shui On Land Limited (the “Company”) for selected recipients for information purposes only. The Company does not warrant the completeness or accuracy of the information contained herein, nor have they independently verified such i