2017 annual results presentationwebcast.live.wisdomir.com/aoyuan_17ar/ppt.pdf · 2018-03-15 ·...

11

2017

Annual Results

Presentation

March 2018

22

Contents

Results Highlights1 3

Financial Overview2 6

Business Operations3 12

Strategic Layout4 22

Appendix5 31

Investor Relations6 35

33

1. Results Highlights

44

• The only PRC developer with credit rating upgrades from all 3 major international rating

agencies since 2016, namely Fitch “BB-”, Moody’s “B1” and S&P “B+”; Domestic credit rating

was upgraded to “AA+” by United Credit Ratings

• As of 31 Dec 2017, net gearing ratio was 51.0% at reasonable industry level, and total

borrowing cost further decreased to 7.2%. Debt structure continued to improve

• Cash collection ratio was 80%, staying at a high industry level; Liquidity remained ample with

total cash of approx. RMB26.54bn

• Contracted sales in 2017 increased by 78% yoy to approx. RMB45.59bn (attributable: 85%),

and achieved 137% of its RMB33.3bn full-year target. CAGR from 2012 to 2017 was 54%

• Contracted sales in Dec 2017 surged by 230% yoy to approx. RMB11.20bn, setting historical

high for single-month sales

• Contracted sales in the first two months of 2018 maintained a strong growth momentum and

surged by 113% yoy to approx. RMB8.11bn

Robust and sustainable contracted

sales growth

• Revenue in 2017 increased by 62% yoy to approx. RMB19.12bn

• Gross profit in 2017 increased by 56% to approx. RMB5.11bn; Gross profit margin was26.7%

• Net profit in 2017 increased by 94% yoy to approx. RMB1.95bn; Core net profit increased by55% yoy to RMB1.89bn

• Recommend a final dividend of RMB25.0 cents per share, representing a 40% dividendpayout ratio for the year, and maintaining a stable dividend policy

Improving profitability and stable dividend

policy

Healthy financial

profile with upgraded

credit ratings

2017 Annual Results Highlights

55

• 13 redevelopment projects are located in Big Bay Area with site area of approx. 1.36mn sqm

and planned total GFA of approx. 5.55mn sqm. 2 to 3 projects are expected to be included

into land bank in 2018

• In addition, 3 redevelopment projects are located in Nanning City, Guangxi Province and

Bazhou City, Hebei Province with site area of approx. 1.21mn sqm and planned total GFA of

approx. 4.98mn sqm, further diversifying land acquisition channels

• Acquired a total of 58 new projects with newly added GFA of approx. 12.86mn sqm (81%

through M&A) and newly added saleable resources of approx. RMB166.9bn. The average

land cost was approx. RMB2,446 per sqm

• As of 31 Dec 2017, total GFA of its land bank was approx. 24.87mn sqm (attributable: 80%)

with saleable resources of approx. RMB282.3bn, sufficient to support the higher sales target

in the coming two years

Proactive land bank

replenishment

• Based in Guangdong with a full coverage in “9+2” cities, Aoyuan seizes the first-mover

advantages and leverage the rapid growth trend in Big Bay Area

• Contracted sales from Big Bay Area amounted to approx. RMB24.28bn, accounting for 53%

of total contracted sales in 2017

• Total GFA of its land bank in Big Bay Area amounted to approx. 7.53mn sqm with total

saleable resources of approx. RMB98.0bn

Key beneficiary of Big Bay Area

with a full coverage

Land bank supports from redevelopment

projects

2017 Annual Results Highlights (cont.)

66

2. Financial Overview

77

(Year ended 31 Dec)

(RMB '000) 2017 2016 Change

Turnover 19,115,255 11,827,268 +62%

Gross profit 5,111,477 3,277,084 +56%

Gross profit margin 26.7% 27.7% -1.0p.p.

Net profit 1,951,952 1,006,608 +94%

Net profit margin 10.2% 8.5% +1.7p.p.

Core net profit(1) 1,889,067 1,223,046 +55%

Core net profit margin 9.9% 10.3% -0.4p.p.

Total dividend per share

(RMB cents)25.0 15.0 +67%

Final dividend per share

(RMB cents)25.0 9.7 -

Special dividend per share

(RMB cents)- 5.3 -

Income statement highlights

Note (1): Excluding non-recurring profit and loss items and their related tax expenses, comprising fair value gain on investment

properties, net exchange gain and loss on early redemptions of senior notes, etc.

88

(RMB '000) At 31 Dec 2017(2) At 31 Dec 2016 Change

Total cash (1) 26,540,063 10,956,456 +142%

Total assets 125,805,861 66,418,413 +89%

Total assets less current

liabilities50,232,707 30,275,816 +66%

Equity attributable to

owners of the Company10,155,036 8,918,093 +14%

Total equity 27,126,290 14,631,293 +85%

Balance sheet highlights

Note:

(1) Total cash = Cash and cash equivalents + Restricted bank deposits. Unrestricted cash accounted for 93% of total cash

(2) As of 31 Dec 2017, credit facilities amounted to approx. RMB51.89bn, of which approx. RMB16.90bn were unutilized

99

At 31 Dec 2017 At 30 Jun 2017 At 31 Dec 2016

Net debt / Total equity(1) 51.0% 63.0% 50.7%

Net debt / Total assets 11.0% 13.6% 11.2%

Net debt / EBITDA(2) 3.5x 4.2x 3.3x

Total liabilities / Total assets 78.4% 78.4% 78.0%

Liquidity ratio(3) 1.5x 1.6x 1.7x

Key financial ratios

Note:

(1) Net debt = Total debt - Total cash

(2) EBITDA = Profit before tax + Finance costs + Depreciation + Amortization

(EBITDA for 30 Jun 2017 is based on the LTM EBITDA up to 30 Jun 2017)

(3) Liquidity ratio = Current assets / Current liabilities

1010

Onshore bank borrowings

47%

Trust loans8%

Onshore corporate

bonds15%

Offshore senior notes

16%

Offshore bank

borrowings14%

2017 Debt breakdown by type

Declining borrowing costs

Debt structure

11.4%

10.2%

9.5%

8.1%

7.2%

6%

8%

10%

12%

2013 2014 2015 2016 2017

• Onshore: 70%

• Offshore: 30%

Note: As of 31 Dec 2017, total debt amounted to approx. RMB40.37bn.

Total cash amounted to approx. RMB26.54bn, sufficient to cover short-

term borrowings of approx. RMB20.49bn

Upgraded credit ratings

✓ The only PRC developer with credit rating upgrades from all 3 majorinternational rating agencies since 2016:

• Fitch “BB-” (Dec 2016); Moody’s “B1” (Mar 2017);S&P “B+” (Jun 2017)

✓ Domestic credit rating was upgraded to “AA+” by United Credit Ratingsin Jun 2017

Close cooperation with banks

Historically low coupon rate

✓ In Sep 2017, successfully issued USD250mn 5.375% senior notes at pardue 2022 which was oversubscribed by 12x

✓ In Jan 2017, became the first Asian issuer to complete USD250mn6.35% senior notes at par due 2020 which was oversubscribed by 10x

✓ In Mar 2018, successfully secured approx. HKD1.6bn three-yearUS/HK dollar dual currency club loan with an interest rate ofLIBOR/HIBOR+3.95% per annum from Nanyang Commercial Bank,Hang Seng Bank and China Minsheng Bank Corporation Hong KongBranch

✓ In Jul 2017, successfully obtained approx. HKD500mn term loan withan interest rate of HIBOR+3.75% by Nanyang Commercial Bank

✓ In Feb 2017, successfully secured approx. HKD1.5bn three-yearUS/HK dollar dual currency club loan with an interest rate ofLIBOR/HIBOR+4.5% per annum from Hang Seng Bank, NanyangCommercial Bank, Bank of East Asia, Chong Hing Bank, ChiyuBanking Corporation and Wing Lung Bank

✓ As of 31 Dec 2017, credit facilities from major banks in China includingBig 4 Chinese banks, Bank of Communications, Ping An Bank, ChinaBohai Bank and China Merchants Bank amounted to approx.RMB51.89bn, of which approx. RMB16.90bn were unutilized

✓ Sydney projects obtained loans from the Big 4 Australian banksincluding Commonwealth Bank of Australia and Westpac BankingCorporation. Canadian projects obtained loans from the Big 5Canadian banks including Bank of Montreal and HSBC. Aoyuan hasbecome one of the few PRC developers who has successfully gainedaccess to local bank financing

1111

10.96

26.54

35.55

24.66

7.90 3.29

-22.16

-16.00

-3.63 -1.67 -1.99

-0.40 -5.00 -2.23 -2.74

0

10

20

30

40

50

60

70

80

90

Openin

g c

ash b

ala

nce

(as o

f 1 J

an)

Opera

ting c

ash flo

w

New

bank b

orro

win

gs

Capita

l inje

ctio

n fro

m n

on

-contro

lling s

hare

hold

er

Pro

ceeds fro

m s

enio

r note

s/

dom

estic

bonds is

suance

Land a

cquis

ition

Constru

ctio

n e

xpenses

Tax e

xpenses

SG

&A

Inte

rest e

xpenses

Div

idend p

aym

ents

Debt re

paym

ent

Redem

ptio

n o

f senio

r note

s

Oth

er c

ash o

utflo

w

Endin

g c

ash b

ala

nce

(as o

f 31 D

ec)

36.47

45.59

0

5

10

15

20

25

30

35

40

45

50

Cash collected Contracted sales

Note (1) : As of 31 Dec 2017, the outstanding land premium was approx. RMB6.25bn which is expected to be fully paid within a year

2017 Cash flow 2017 Cash collection

(RMB billion) (RMB billion)

80%

Cash flow & CAPEX

Aoyuan adheres to a principle of prudent financial management by recycling capital

through rapid presales to ensure a sound financial profile and healthy cash flow

(1)

1212

3. Business Operations

1313

5,251 10,038 12,223 15,171

25,602

45,590

73,000

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

2012 2013 2014 2015 2016 2017 2018 Target

1,1

32

636

880

666

929 1,8

26

1,0

21

1,4

03

1,1

40

1,5

12

1,8

90

2,1

40

1,5

03

707

1,5

46

1,7

32

2,0

73

2,9

67

1,2

25

1,4

33

3,6

31

2,5

05

2,8

86

3,3

93

1,6

88

2,1

04

1,5

46

2,5

11

2,6

30

5,3

20

2,5

31

2,6

55 4,0

81

4,2

80

4,3

22

11,1

96

4,0

50

4,0

55

0

2,000

4,000

6,000

8,000

10,000

12,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2015 2016 2017 2018

Yearly contracted sales

(RMB million)

(RMB million)

2018

contracted

sales target

increased by

60% yoy

Robust and sustainable contracted sales growth

Monthly contracted sales

First half of the year Second half of the year

1414

Contracted sales and recognized sales

2,980

4,487

1,607

2,428

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

2016 2017

Contracted GFA sold Recognized GFA sold

25,602

45,590

11,240

17,960

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

2016 2017

Contracted sales Recognized sales

8,591

10,158

6,993 7,397

0

2,000

4,000

6,000

8,000

10,000

12,000

2016 2017

Contracted ASP Recognized ASP

Contracted sales and

recognized sales

(Value)(1)(2)


recognized sales

(GFA)


recognized sales

(ASP)

(000's sqm) (RMB million) (RMB per sqm)

Note(1): The attributable contracted sales accounts for 85% of contracted sales in 2017, staying at high industry level

Note(2): As of 31 Dec, 2017, contracted sales that were yet to be recognized as revenue amounted to approx. RMB51.6bn

1515

2016 contracted sales: RMB25.60bn 2017 contracted sales: RMB45.59bn

By region By region

2016 contracted sales: RMB25.60bn

By product

2017 contracted sales: RMB45.59bn

By product

Contracted sales breakdown

Guangzhou13%

South China (excl. Guangzhou)

47%

Core region of Central &

Western China24%

East China10%

Bohai Rim2%

Offshore4%

Guangzhou14%

Shenzhen12%

South China (excl. Guangzhou

& Shenzhen)45%

East China11%

Bohai Rim3%

Offshore3%

Residential properties

73%

Commercial properties

27%


77%


23%

Core

region of

Central &

Western

China

12%

1616

Recognized sales breakdown

2016 recognized sales: RMB11.24bn 2017 recognized sales: RMB17.96bn

2016 recognized sales: RMB11.24bn 2017 recognized sales: RMB17.96bn

By region By region

By product By product


73%


27%

Guangzhou29%

South China(excl. Guangzhou)

29%

East China13%

Bohai Rim6%

Guangzhou15%

South China(excl.

Guangzhou)47%


Western China23%

East China12%

Bohai Rim3%


71%


29%

Core

region of

Central &

Western

China

23%

1717

Aoyuan maintains flexible CAPEX management and sound cash flows

via managing new starts GFA and completed GFA to adapt to market changes

(000's sqm)

New starts GFA and completed GFA

2,037

3,060

6,650

1,368

2,212

3,605

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2015 2016 2017

New starts GFA Completed GFA

Shenzhen Aoyuan Jade Bay

1818

Upgraded product and further enhanced competitiveness

Aoyuan’s product quality is well recognized through enhanced value-added content

Guangzhou Aoyuan Lianfeng State was awarded the 54th Gold Nugget Awards

for Best International Residential Project in Jun 2017

珠海奥园广场

Shenzhen Aoyuan Jade Bay

Guangzhou Aoyuan Glorious Mansion Zhuhai Aoyuan Seaview Mountain

Guangzhou Aoyuan Lianfeng State

1919

Upgraded product and further enhanced competitiveness (cont.)

Ningbo Aoyuan Lake Bay

Foshan Aoyuan Peach City Huizhou Aoyuan Yushan Lake

Chengdu Chenghua Aoyuan Plaza

Product quality is well recognized through enhanced value-added content

Guangzhou Aoyuan Lianfeng State was awarded the 54th Gold Nugget Awards

for Best International Residential Project in Jun 2017

2020

Asset-light operating model of commercial development

Successful Model: Guangzhou Panyu Aoyuan Plaza

• Total GFA: approx. 250,000 sqm (Commercial: 100%)

• Development model: Shopping street/ Apartments(sold) + Shopping mall (owned)

• Guangzhou Panyu Aoyuan Plaza shopping mall was opened in Dec 2012. Occupancy

rate is 98%

Successful Replication: Chongqing Aoyuan Panlong Yihao

• Total GFA: approx. 460,000 sqm (Residential: 70%, Commercial: 30%)

• Development model: Residential/ Shopping street/ Offices/ Commercial apartments

(sold) + Shopping mall (owned)

• Chongqing Panlong Aoyuan Plaza was opened in Dec 2017. Occupancy rate is 100%

Project Location Status Product type(1) GFA (sqm) Interest (%)

1 Guangzhou Panyu Aoyuan Plaza Panyu, Guangzhou Leased C, S 80,500 54%

2 Guangzhou Aoyuan Panyu, Guangzhou Leased C, S 8,600 100%

3 Shenyang Aoyuan The Metropolis Shenyang, Liaoning Leased H 4,150 100%

4 Guangzhou Aoyuan City Plaza Panyu, Guangzhou Leased C, CH 6,610 100%

5 Chongqing Panlong Aoyuan Plaza Chongqing Leased C, S 53,700 60%

6 Wuhua Aoyuan Plaza Meizhou, Guangdong Leased C, S 25,400 100%

7 Jiaoling Aoyuan Plaza Meizhou, Guangdong Leased C, S 19,100 100%

8 Guangzhou Luogang Aoyuan Plaza Huangpu, Guangzhou Leasing C 34,400 60%

9 Guangzhou Aoyuan Kangwei Plaza Zengcheng, Guangzhou Leasing C, S 60,000 51%

10 Zhuhai Aoyuan Plaza Zhuhai, Guangdong Leasing C, S 66,700 93%

11 Chongqing Aoyuan The Metropolis Chongqing Leasing C 19,250 100%

12 Chongqing Chayuan Aoyuan Plaza Chongqing Leasing C 52,300 51%

13 Shenyang Aoyuan Convention Plaza Shenyang, Liaoning Leasing C, S 114,200 100%

14 Liuyang Aoyuan Plaza Changsha, Hunan Leasing C, S 25,000 100%

15 Bengbu Aoyuan Ginza Bengbu, Anhui Leasing C, S 35,500 100%

16 Chengdu Chenghua Aoyuan Plaza Chengdu, Sichuan Leasing C, S 65,000 70%

Note (1): C = Commercial; S = Retail shop; CH = Club house; H = Hotel

Aoyuan maintains its commercial development strategy of “primarily saleable properties and supplemented by investment properties” to diversify income streams and add values to residential properties

Major investment properties

2121

✓Achieved contracted sales target for three consecutive years: Since the offshore market expansion in 2015, the accumulated contractedsales has exceeded RMB3bn, achieving sales target for three consecutive years

✓Projects have successfully moved into construction phase and demonstrated strong execution : One30 Hyde Park Sydney, Maison188 Maroubra Sydney, and Mirabell Turramurra Sydney have entered into construction phase, and will deliver on time as planned. Aoyuan hasbecome one of the few developers to commence construction among PRC developers in offshore markets

✓Funds from local financing channels: Aoyuan obtained loans for land acquisition and constructions from Big 4 Australian banks includingCommonwealth Bank of Australia and Westpac Banking Corporation for Sydney projects, while loans were obtained for land acquisition fromBig 5 Canadian banks including Bank of Montreal and HSBC for Canadian projects. Aoyuan has established a good credit record locally andbecome one of the few PRC developers that has access to local financing channels in offshore markets

✓Experienced local management team and good relationship with professional consultants: Aoyuan has offshore management teamsconsisting of local professionals with a wealth of experience in property development, operations and financial management, and haveestablished long-term relationships with reputable local professional consultants, enhancing project execution to cater local needs

✓Primarily target local customers: Local buyers accounted for 75% of Aoyuan’s offshore projects, capturing the strong local housing demand

Remarkable development in offshore markets through localization strategies

Aoyuan has established itself as a genuine local developer and achieved remarkable performance

by implementing localization strategies for developing offshore projects

One30 Hyde Park Sydney and its construction progress

(Aoyuan’s first offshore project)Maison 188 Maroubra Sydney and its construction progress

(Aoyuan’s first offshore project developed independently)

2222

4. Strategic Layout

2323

15,000 14,638

5,894

4,124 3,337

2,954 2,800

2,680

2,238

2,190 1,925

1,434

1,335

1,314 919 532 338 337 438

0

5,000

10,000

15,000

20,000

Beijin

g

Shenzhen

Overs

eas

Hubei

Sic

huan

Guangzhou

Zh

ejia

ng

Shandong

Jia

ngsu

Chongqin

g

Fu

jian

Anhui

Hunan

Guangxi

Guiz

hou

Lia

onin

g

Jia

ngxi

Shaanxi

Guangdong

(excl. G

uangzhou &

S

henzhen)

RegionProvince/

City

Contribution

(by total

GFA)

Total GFA

(‘000 sqm)

Expected

Saleable

Resources

(RMB mn)

South China

Guangzhou &

Shenzhen1,890 33,723

Others,

Guangdong8,924 102,630

Guangxi 3,117 23,689

Subtotal 56% 13,931 160,042

Core region

of Central &

Western

China

Chongqing 1,042 7,297

Sichuan 795 8,746

Hunan 2,073 14,719

Hubei 333 3,499

Shaanxi 288 2,650

Jiangxi 250 1,627

Guizhou 302 1,208

Subtotal 20% 5,084 39,746

East China

Zhejiang 665 7,984

Jiangsu 1,342 14,762

Anhui 503 5,528

Fujian 614 8,283

Subtotal 13% 3,124 36,557

Bohai Rim

Liaoning 1,426 7,845

Beijing 176 5,100

Shandong 501 4,505

Subtotal 8% 2,103 17,450

Offshore

Australia 328 13,136

Canada 290 14,511

Macau 8 899

Subtotal 3% 626 28,546

Grand total 100% 24,868 282,341

Average land cost:

RMB2,131 per sq.m.

Average land cost by region

Sufficient and quality land bank

Guangxi Guangdong

JiangxiChongqing

Jiangsu

Hunan

Liaoning

ZhejiangSichuan

Beijing

Hubei

Fujian

Anhui

Based in Guangdong with a main focus on Big Bay Area, Aoyuan has a strategic layout in

South China, core region of Central & Western China, East China and Bohai Rim

As of 31 Dec 2017, Aoyuan had 135 projects with a total GFA of approx. 24.87mn sqm (attributable: 80%) and

total saleable resources of approx. RMB282.3bn, which is sufficient for development needs in approx. three years

Shandong

Shaanxi

Guizhou

Macau

2424

Sufficient and quality land bank (cont.)

Land bank breakdown by region

(by land cost)

Land bank breakdown by region

(by saleable resources)

Land bank breakdown by type

(by GFA)

Land bank breakdown by status

(by GFA)


75%


19%

Investment properties

3%

Auxilliary facilities

3%

South China55%


Western China18%

East China12%

Bohai Rim8%

Offshore7%

South China57%


Western China14%

East China13%

Bohai Rim6% Offshore

10%

Held for future

development53%

Under development

36%

Completed and held for

sale7%

Completed and sold, but yet to be

delivered/ Auxiliary facilities

4%

2525

HK-Zhuhai-Macau

Bridge

HK-Zhuhai

(Commence

operation in 2018)

3 hrs 30 mins

Shenzhen-

Zhongshan Bridge(Commence

operation in 2024)3 hrs 30 mins

Zhongshan-

Shenzhen

18 mins45 mins

2 hrs 48 mins

HK-Guangzhou

Guangzhou-Shenzhen-

Hong Kong

High Speed Rail

Inter-city railway

3,200km

(2016)

4,400km

(2020)

Expressway

~5,600km

(2016)

~8,800km

(2020)

Construction of

“1 Hour Living

Circle” through

integration

(HK section to

commence operation

in 2018)

1.5(+3.5%) 1.34

(+7.9%)1.3

(+3.6%)

0.8(+2.7%)

0

0.4

0.8

1.2

1.6

纽约湾区东京湾区旧金山湾区

GDP and GDP Growth in 2016

Big Bay

Area

Guangdong-Hong Kong-Macau Big Bay Area：China’s new economic growth engine

The “9+2”city cluster in Big Bay Area possesses strong economic power, high aggregation of industries, close connection to

inland areas and high openness to the world. It will grow into a top international bay area and a world-class metropolitan cluster,

serving as a key growth engine for China’s economic development

Source: China Index Institute

Up

gra

de

d fro

m re

gio

na

l co

op

era

tion

pla

n to

na

tion

al s

trate

gy

Enhanced industrial upgrade

and market integration

Eastern

region

HKGlobal financial, shipping and

trading hub

ShenzhenInternational innovative

services center

DongguanGlobal smart manufacturing

powerhouse

Huizhou World-class base for

petrochemical industry

Central

region

Guangzhou

Lingnan cultural center and

South China heavy industries

center

Foshan International manufacturing

center

ZhaoqingHub for transformation and

upgrade of traditional industries

Western

region

Macau Leisure and tourism hub

ZhuhaiNational equipment

manufacturing center

ZhongshanOne of the appliances base in

China

JiangmengNational advanced

manufacturing base

(USD tn)

NY Bay

Area

Tokyo Bay

Area

San Francisco

Bay Area

2004

• Release of the first regional ministry-province cooperation plan--Pearl

River Delta Urban Agglomeration Coordinated Development Plan

2008

• The State Council released “Reform and Development Plan of the Pearl River Delta Region (2008-2020)” to encourage Guangdong, Hong Kong and Macau to develop regional coordinated development plans

2010

• Key Action Plan for the Construction of Livable Bay Area in the Pearl River Delta Region jointly formulated by the governments of Guangdong, Hong Kong, and Macau

2014

• Concept of "Bay Area Economy“ was first mentioned in the Shenzhen

Government Work Report

2015

• Release of “Vision and Action to Promote the Construction of the Silk Road Economic Belt and the 21st Century Maritime Silk Road”, enhancing the construction of Guangdong-Hong Kong-Macau Big Bay Area into a national strategic plan

2016

• Construction of Guangdong-Hong Kong-Macau Big Bay Area was

included into the National 13th 5-Year Plan

2017

• In March, the State Council’s Government Work Report mentioned “research and formulation of development plan in Big Bay Area”

• The “Framework Agreement for Deepening the Cooperation between Guangdong, Hong Kong and Macau to Promote the Construction of the Big Bay Area” was signed in July

2018

• “Development Plan of the City Cluster in Guangdong-Hong Kong-Macau Big Bay Area” will be released soon; establishment of a world-class Bay Area will evolve from strategic planning into full-speed implementation

HK-Shenzhen

2626

Benefiting from national policies, Aoyuan seizes the first-mover advantages and

leverage the rapid growth trend with a full coverage of “9+2” cities in Big Bay Area

First mover in Big Bay Area with a full coverage

CityTotal GFA

(‘000 sqm)

Total Saleable

Resources

(RMB bn)

Guangzhou 1,600 24.8

Shenzhen 290 9.3

Zhuhai 492 8.5

Foshan 1,037 13.5

Huizhou 1,372 15.5

Dongguan 290 3.5

Zhongshan 257 3.0

Jiangmen 1,735 15.0

Zhaoqing 453 4.0

Hong Kong & Macau 8 0.9

Total 7,534 98.0

✓ Headquartered in Guangzhou with a strong

presence in Guangdong, Aoyuan has abundant

local resources and experiences, including land,

talents, network and capital

✓ Contracted sales from Big Bay Area reached

RMB24.3bn in 2017, accounted for 53% of total

contracted sales

✓ Aoyuan has a total of 50 projects covering all “9+2”

cities in Big Bay Area. Total GFA of land bank is

approx. 7.53mn sqm with total saleable resources of

approx. RMB98.0bn

Jiangmen

Zhaoqing

Foshan

Dongguan

Shenzhen

Hong Kong

Zhuhai

Huizhou

Shenzhen –

Zhongshan Bridge

Zhongshan

Macau

Hong Kong–Zhuhai–

Macau Bridge

Guangzhou

Guangzhou

Jiangmen

Zhongshan

Shenzhen Zhuhai

Huizhou

Foshan

Dongguan

MacauZhaoqing

2727

Aoyuan has 16 redevelopment projects at different phases in Big Bay Area and other regions

with planned total GFA of approx. 10.53mn sqm

Project City Type StatusSite Area

(‘000 sqm)

Planned Total GFA

(‘000 sqm)

1 Guangzhou Panyu Nitrogen Fertilizer Plant Guangzhou, Guangdong Old factory Redevelopment planning application 150 300

2 Zhuhai Cuiwei Village Zhuhai, Guangdong Old village Redevelopment planning application 310 1,470

3 Zhuhai Shuiwengkeng Village Zhuhai, Guangdong Old village Redevelopment planning application 90 360

4 Zhuhai Gongbei Lian’an Village Zhuhai, Guangdong Old villageGovernment approval;

Compensation agreement90 390

5 Zhuhai Gongbei Guanzha Village Zhuhai, Guangdong Old villageGovernment approval;


6 Zhuhai Gongbei Gaosha Village Zhuhai, Guangdong Old villageGovernment approval;


7 Zhuhai Xiaxu Village Zhuhai, Guangdong Old village Redevelopment planning application 70 430

8 Zhuhai Qianshan Anlian Road Zhuhai, Guangdong Old factory Redevelopment planning application 10 80

9 Zhuhai Yafang Building Zhuhai, Guangdong Old factory Redevelopment planning application 10 70

10 Zhuhai Pingsha Aoyuan Plaza Zhuhai, Guangdong Old factory Redevelopment planning application 150 610

11 Zhuhai Jianghai Electronics Factory Zhuhai, Guangdong Old factory Cooperation agreement 50 330

12 Dongguan Pailouji Village Dongguan, Guangdong Old village Decision on early-stage partner 100 250

13 Dongguan Shimei Village Dongguan, Guangdong Old village Decision on early-stage partner 200 500

14 Nanning Nantang project Nanning, Guangxi Old village Redevelopment planning application 290 1,160

15 Nanning Chendong Village Nanning, Guangxi Old village Redevelopment planning application 760 3,420

16 Hebei Bazhou Bazhou, Hebei Old village Redevelopment planning application 160 400

Total 2,570 10,530

Redevelopment projects in Big Bay Area and other regions

Cooperation agreementConfirm

redevelopment planRedevelopment

planning application

State-owned land ownership

certificate

Villagers’ general assembly to decide on

redevelopment

Villagers’ general assembly to

decide on early-stage partner

Redevelopment planning

application

Government approval;

Compensation agreement

State-owned land ownership

certificate

1-3 months

Case study 1: Redevelopment and transformation timetable for old factories in Zhuhai

Case study 2: Redevelopment timetable for old villages in Zhuhai

1-3 months 1-3 months 1-3 months

1-3 months 1-3 months 3-6 months 1-3 months6-9 months

2828

Redevelopment projects in Big Bay Area and other regions (cont.)

Case study 3: Zhuhai Aoyuan Plaza

• Type: Old factory redevelopment

• Total GFA: 271,000 sqm

• Avg. land cost: RMB2,732 per sqm

• Accumulated ASP: RMB20,132 per sqm

• Accumulated contracted sales: approx. RMB4.23bn

• Redevelopment timetable:

✓ Dec 2014: Redevelopment planning applicationsubmitted

✓ Mar 2015: Redevelopment planning application toZhuhai City Planning Commission

✓ Jun 2015: Land transfer contract signed

✓ Jul 2015: Obtained land ownership certificate

✓ Oct 2015: Launched for presales

Case study 4: Guangzhou Luogang Aoyuan Plaza

• Type: Old village + old factory redevelopment

• Total GFA: 334,000 sqm

• Avg. land cost: RMB4,858 per sqm

• Accumulated ASP: RMB16,493 per sqm

• Accumulated contracted sales: approx. RMB4.31bn

• Redevelopment timetable:

✓ Jun 2012: Signed cooperation agreement withvillage

✓ Jun 2012: Redevelopment plan approved

✓ Jun 2013: Phase 1 (old village for open auction)

✓ May 2014: Phase 2 (old factory for open auction)

✓ Jun 2014: Launched for presales

Zhuhai Aoyuan Plaza and its construction progress

(Aoyuan Zhuhai redevelopment project)

Guangzhou Luogang Aoyuan Plaza and its construction progress

(Aoyuan Guangzhou redevelopment project)

2929

In 2017, Aoyuan acquired 58 projects with newly added GFA of approx. 12.86mn sqm (M&A: 81%) and newly added saleable

resources of approx. RMB166.9bn, sufficient to support higher sales targets in the coming two years at reasonable cost

Proactive land bank replenishment

Region Province/ City

Avg. land

cost

(RMB/sqm)

Total GFA

(‘000 sqm)

Attributable

GFA

(‘000 sqm)

Attributable

land cost

(RMB mn)

Interest (%)

South

China

Big Bay Area 2,640 4,574 2,755 7,000 60%

Guangdong

(excl. Big Bay Area)1,591 630 503 919 80%

Guangxi 1,229 1,129 825 1,261 73%

Subtotal 2,285 6,333 4,083 9,180 64%

Core

region of

Central &

Western

China

Chongqing 1,626 497 337 584 68%

Sichuan 5,113 238 238 1,218 100%

Hunan 1,198 1,397 958 1,021 69%

Hubei 4,124 333 333 1,375 100%

Guizhou 532 302 302 161 100%

Shaanxi 438 288 147 126 51%

Subtotal 1,755 3,055 2,315 4,485 76%

East

China

Zhejiang 3,355 315 248 1,008 79%

Jiangsu 2,216 1,246 908 2,355 73%

Fujian 1,413 650 395 603 61%

Subtotal 2,142 2,211 1,551 3,966 70%

Bohai RimBeijing 14,934 176 176 2,638 100%

Shandong 2,680 500 385 1,117 77%

Subtotal 5,866 676 561 3,755 83%

Offshore

Australia 1,328 288 288 382 100%

Canada 7,195 290 290 2,088 100%

Macau 58,065 8 4 248 55%

Subtotal 4,984 586 582 2,718 99%

Grand total 2,446 12,861 9,092 24,104 71%

Regional distribution (by GFA)

Regional distribution (by land cost)

South China49%

Core region of Central & Western

China24%

East China17%

Bohai Rim5%

Offshore5%

South China46%


Western China17%

East China15%

Bohai Rim13%

Offshore9%

3030

High-quality projects

successfully acquired since IPO

No.

Avg. land

cost

(RMB/sqm)

Total GFA

(sqm)

Total cost

(RMB mn)

2008 2 369 341,483 126

2009 4 876 3,583,868 3,138

2011 7 2,933 1,268,457 3,721

2012 8 2,178 1,874,914 4,084

2013 8 2,245 2,232,579 5,013

2014 8 1,715 2,657,445 4,557

2015 13 2,312 2,491,800 5,761

2016 17 3,170 3,138,700 9,950

2017 58 2,446 12,861,278 31,458

Total 125 2,227 30,450,524 67,808

Proactive land bank replenishment (cont.)

Breakdown of land bank acquired since IPO

(by land cost)

South China52%


Western China20%

East China12%

Bohai Rim10%

Offshore6%

• As of 31 Dec 2017, land bank in Tier 1 and 2 cities and its

surrounding city clusters accounted for 82% of total land cost

• Aoyuan implements a balanced city layout with a main focus

on Big Bay Area while further expanding in East China and

core region of Central & Western China. Aoyuan adheres to

a disciplined land bank replenishment strategy, building a

solid foundation for the strategic and sustainable

development in the future

3131

5. Appendix

3232

Shareholding structure

Guo Zi Wen/Guo Zi Ning*Deemed interests

Approx. 54%

Public

Approx. 46%

(As of 14 Mar 2018)

✓ In Jan 2018, Chairman Guo Zi Wen acquired 1mn shares at an average price of approx. HKD5.93 per share, with atotal consideration of HKD5.93mn, and his shareholding was approx. 54%

✓ In Mar 2017, Chairman Guo Zi Wen acquired approx. 53.43mn shares at an average price of approx. HKD2.40 pershare, with a total consideration of HKD128mn, and his shareholding increased to approx. 54%

✓ In Nov 2016, Aoyuan repurchased approx. 112mn shares at an average price of approx. HKD1.68 per share, with atotal consideration of HKD188mn (approx. 4% of the entire issued share capital of Aoyuan)

✓ In Aug 2015, Chairman Guo Zi Wen acquired approx. 55.12mn shares at an average price of approx. HKD1.65 pershare, with a total consideration of HKD91.41mn, and his shareholding increased to approx. 50%

✓ In Jul 2014, Chairman Guo Zi Wen acquired approx. 56.23mn shares at an average price of approx. HKD1.55 pershare, with a total consideration of HKD86.97mn, and his shareholding increased to approx. 48%.

While maintaining a stable dividend policy, Chairman of Aoyuan has demonstrated strong confidence in

Aoyuan’s long term development and prospects through rounds of share purchases and buybacks

3333

Aoyuan: Breakthrough to Success

Pioneer

(开创)

Founded in 1996, Aoyuan first introduced the "Sports + Property“ development

concept with its branding philosophy of “Building a Healthy Lifestyle”. As a pioneer in

composite real estate development in China, Aoyuan has successfully developed

composite real estate projects with themes of education, regimen and healthcare,

and commercial, etc.. Aoyuan was listed on the Main Board of SEHK in 2007

Aoyuan received approx. HKD3.2bn in cash and recorded special gains of HKD1.1bn

by successfully exiting 8 Chang’an Ave Beijing project in 2012. Aoyuan was ready to

unleash its potential, and persist with further breakthroughs. In the same year,

Aoyuan successfully issued its first USD senior notes in the international capital

markets. In 2013, contracted sales exceeded RMB10bn and more professional

managers were attracted to join Aoyuan

In 2017, Aoyuan achieved contracted sales of RMB45.6bn with a growth rate of 78%

yoy, representing a CAGR of 54% from 2012 to 2017. Monthly contracted sales in

December 2017 amounted to RMB11.2bn, setting a historical high for single-month

sales. The 2018 full-year contracted sales target is set to be RMB73bn

The only PRC developer with credit rating upgrades from all 3 major international

rating agencies since 2016, namely Fitch, Moody’s and S&P; Domestic credit ratings

was also upgraded by United Credit Ratings. With financing cost optimization and

soaring share price, following the recent inclusion in the Shenzhen-Hong Kong Stock

Connect, Aoyuan is regarded as one of the best performing PRC property developer,

reaffirming its outstanding track records and financing capabilities in capital markets

Breakthrough

(破茧)

Take-off

(起飞)

Upgrade

(跃升)

3434

Board of Directors

4 Executive Directors and 3 Independent Non-executive Directors

Audit Committee, Remuneration Committee, and Nomination Committee

Senior Management

Financial

and Fund

Management

Investment

and Fund

Management

Capital Markets,

International

Investment Group

Financial Management, HR& Administration

Management

Operations

Management

Project

Management

Commercial

Group

Design

and R&D

CHEN Zhi Bin

Vice President

CHEN Yong

Vice President

Jacky CHAN

Vice President

ZHONG Ping

CFO

MA Jun

COO

XIAO Yi

Vice President

ZHANG Jun

Vice President

GAO Xiang Dong

Assistant to

President

ZHONG Ping

Executive Director,

CFO

MA Jun

Executive Director,

COO

GUO Zi Ning

Vice Chairman,

CEO

GUO Zi Wen

Chairman,

Group Founder

CHEUNG

Kwok Keung

Independent Non-

executive Director

TSUI King Fai

Independent Non-

executive Director

HU Jiang

Independent Non-

executive Director

Attracting experienced talents to strengthen professional management team,

upholding excellent compliance in corporate governance and maintaining high corporate transparency

to enhance the core competitiveness and ensure balanced and sustainable development

Professional management team and outstanding corporate governance

3535

6. Investor Relations

3636

Mainland China & Hong

Kong 71%

Asia Pacific (excl.

Mainland China & Hong

Kong )15%

Europe7%

America7%

IR management

Committed to professional and effective investor relations management, Aoyuan strives to maintain a long-

term interactive relationship with investors. Aoyuan upholds an open and candid attitude to listen to

the capital markets and maintain a high level corporate transparency and corporate governance

Close and two-way communication with investors 2017 Investor relations activities in 2017

Investment institutions by region Investment institutions by investor type

Management meeting

212 times

Telephone/ video

conference23 times

Investor roadshow17 times

Investor conference

11 times

Project site visit10 times

Investor briefing and press conference

4 times

Equity 52%

Bond48%

✓ Organized and participated in a total of 277 investor relations

activities in 2017, including 212 management meetings, 23

telephone/ video conferences, 4 investor briefings and press

conferences, 10 site visits, 11 investor conferences and 17

investor roadshows held in Hong Kong, Singapore, Europe,

Shenzhen, Shanghai and Beijing, etc

✓ Met and communicated with 967 institutional investors from 654

investment institutions in 2017 to enhance investor’s awareness

of latest development in business performance, operating

conditions and development strategies, to understand capital

market views and provide timely feedback to top management

3737

IR management (cont.)

Results Briefing

Results Briefing

Annual General Meeting

Annual General Meeting

Investor Conference

Reverse Roadshow

Investor Roadshow

Investor RoadshowInvestor Site Visit

Committed to professional and effective investor relations management, Aoyuan strives to maintain a long-

term interactive relationship with investors. Aoyuan upholds an open and candid attitude to listen to

the capital markets and maintain a high level corporate transparency and corporate governance

3838

Company HQAoyuan Mansion, No.108,

Huangpu Avenue West, Tianhe, Guangzhou

HK OfficeUnit 1901-02, 19/F, One Peking,

No.1 Peking Road, T.S.T, Hong Kong

E-mail [email protected]

Jacky Chan

Group Vice President

President of International Investment Group

HK: (852) 2180 9566

China: (86 20) 3868 6666

Email: [email protected]

Anthony Cheng

Financial Controller

HK: (852) 2180 6981

China: (86 20) 3868 6666


Emma Qi

Deputy Head of Corporate Finance and

Investor Relations

HK: (852) 2180 9566

China: (86 20) 3868 6666


Heng Tam

Assistant Investor Relations Manager

HK: (852) 2180 9556

China: (86 20) 3868 6666


IR contacts

Aoyuan WeChat

Official Account

Aoyuan Club WeChat

Subscription Account

Follow us on:

3939

This presentation was prepared by China Aoyuan Property Group Limited (the “Group” or the “Company”) for reference only.

This presentation may not be reproduced or redistributed to any persons without explicit authorization from the Company.

Neither the Company nor any of its respective subsidiaries, directors, employees or advisors, directly or indirectly, gives any

representation or warranty as to the completeness and accuracy of all the information contained in this presentation (including

all forward-looking statements). The information contained in this presentation should be considered in the context of the

circumstances prevailing at the time of presentation and has not been, and will not be, updated to reflect material

developments which may occur after the date of the presentation.

This presentation contains statements that reflect the Company’s beliefs and expectations about the future. These forward-

looking statements are based on a number of assumptions about the Company’s operations and factors which are beyond the

Company’s control, and accordingly, actual results may differ materially from these forward-looking statements. The Company

does not undertake to revise forward-looking statements to reflect future events or circumstances.

The Company expressly disclaims all the liabilities (in negligence or otherwise) for any loss incurred or sustained by the

participants of this presentation, their employers, entities, agents or any of their related parties as a result of using the

information contained in this presentation.

The materials and information in this presentation are for informational purposes only and do not constitute an offer or

solicitation for the purchases or sale of any securities or financial instruments or to provide any investment service or

investment advice.

Disclaimer

2017 annual results presentationwebcast.live.wisdomir.com/aoyuan_17ar/ppt.pdf · 2018-03-15 ·...

Documents