Profit Attributable to Equity Holders Increases 42%
Contracted Sales Exceeds HK$10 Billion
Total Landbank Surpasses 10 Million Square Meters
Financial Highlights
Revenue RMB5,634 million (+20.6%)
Total revenue (including the sales of investment properties) RMB6,979 million (+42.2%)
Operating profit RMB1,801 million (+44.8%)
Profit from continuing operations attributable to equity holders of the Company RMB919 million (+42.2%)
Basic earnings per share Continuing operations RMB0.1228 (+35.5%)
Property Contracted sales gross floor areas 543,000 square meter (+3.1%)
Property Contracted sales RMB8,855 million (+45.2%)
(March 21, 2011, Hong Kong) Yuexiu Property Company Limited ( Yuexiu Property or the Company ) (HKEx Stock Code: 00123) announced the audited results of the Company and its subsidiaries (collectively the Group ) for the twelve months ended 31 December 2010 (the Year ).
During the Year, revenue of the Group was approximately RMB5,600 million, representing an increase of 20.6% over 2009. Profit attributable to the shareholders from continuing operations amounted to RMB919 million, representing an increase of 42.2% over 2009. Basic earnings per share from continuing operations were RMB12.28 cents, representing an increase of 35.5% over 2009. The board does not recommend the payment of any final dividend for the year 2010.
With respect to the property market in 2010, Mr. Lu Zhifeng, Chairman of the Group, comments, Last year was an extraordinary year. After the introduction of a series of regulatory policies, transaction volume declined with varying degree from place to place in response. The Group proactively responded to the complex external environment. We strengthened the market analysis, timely seized the opportunities in the residential and commercial property markets when demand was hot by increased efforts in sales promotion.
In 2010, the Group s contracted sales, recognized sales, and property sold but not yet recognized sales all hit record high: contracted sales reached RMB8,855 million, representing an increase of 45.2% compared to last year; recognized sales revenue amounted RMB5,646 million, representing an increase of 52.1% year-on-year; and property sold but not yet recognized sales reached RMB8,403 million, representing an increase of 74% over the previous year.
We are thrilled to see the record highs of our sales. It is the third year since we determined to refine operations to improve quality in 2008, and now, the sales figures revealed that our performances were excellent. Mr Lu continued, In addition, as of 31 December 2010, the area of projects under construction of the Group amounted to approximately 2.92 million square meters. This reflects that we have sufficient projects which will be available for launches in next two to three years.
During the year, the Group s landbank increased by gross floor areas 3.46 million square meters. The Company s total land reserves surpass the 10 million square meters gross floor areas of which approximately about 7.09 million square meters is for future development and 2.92 million square meters gross floor areas is currently under construction. The footprint has been increased from five cities in 2009 to nine cities in 2010 in China, focusing in the Pearl River Delta and branching out to selective cities in the Yangtze River Delta, Bohai Rim Economic Zone and Central Region, forming an initial strategic nation-wide base to capture new business opportunities.
As of 31 December, 2010, the Group owned investment properties of approximately 920,000 square meters; total rental income amounted to approximately RMB289 million, an increase of about 1% over the previous year. During the Year, fair value of the investment properties stood at RMB7.6 billion, representing an appreciation of approximately RMB260 million over 2009.
According to the Board s strategic plan of optimizing asset structure, the Group has increased the size of the asset pool of low yield assets slated for disposal. 69,400 square meters of non-core and low-yield investment properties has been disposed of for an aggregate amount of RMB1,268 million. The Group continued to dispose of inefficient and sporadic investment properties to rationalize the proportion and structure of investment properties held by the Group, leading to a more flexible capital structure.
After spinning off the toll road business in 2009, the Group further disposed of the remaining non-real estate business, namely, the supermarket business, by selling it to China Resources Enterprise Limited at the end of 2010. Such disposal completed the goal of divesting all non-core business, enabling the Group to focus on real estate business.
Last year, the Company raised about HK$3.4 billion in equity through the issue of 2,141,822,374 new shares at the subscription price of HK$1.61 at an opportune time. The exercise not only improved the Company s capital structure but also created significant room for the Company to increase the scale of development in pursuit of sustainable growth.
Looking forward, the Group estimates that total available gross floor areas reached pre-sale status will amount to approximately 780,000 square meters in 2011. Given the uncertain market conditions, the Group conservatively set contracted sales gross floor areas and revenue targets at no less than 540,000 square meters and RMB 9 billion respectively.
Mr. Lu concludes, Taking note of the fact of increasing investments have been diverted to the commercial property segment from the residential property market in Guangzhou, as the latter was being the primary target of the macro-economic revision measures in the PRC, we will allocate greater resources to promote the sales of commercial properties in the short term, and expect that such sales would comprise as much as 40% of the annual sales target.
In addition, we planned to invest not less than RMB6 billion to replenishing the landbank. We will put our focus on winning three old transformation projects in the Guangzhou urban renewal. Also, we will continue to seek new opportunities in other cities where we have set our foothold in order to expand and consolidate our presence in those cities.
~End~
About Yuexiu Property
Yuexiu Property Company Limited (HKEx Stock Code: 00123) was listed in Hong Kong in 1992. The Company s main business is property development with its operations mainly concentrated in the Guangzhou area, and gradually expands to Pearl River Delta, and branching out to selective locations in the Yangtze River Delta, Bohai Rim Economic Zone and Central Region.
Note for Editors
Details of the results announcement have been set out in the announcement published by Yuexiu Property on the website of The Stock Exchange of Hong Kong Limited. The announcement is also available for review on the website of Yuexiu Property www.yuexiuproperty.com
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