centraland limited fy2010 results presentation

Corporate Presentation

CENTRALAND LIMITED

25 February 2011

A Leading Zhengzhou-Based

Property Developer and

Property Manager …

… Focused on Wholesale Malls

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Contents

Company Overview

Financial Review

Corporate Updates

Appendix: Background on Wholesale

Trading Hubs

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Company Overview

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Business acquired by present management in November 2003

Focused on specialty wholesale trading hubs

Listed on the SGX Mainboard on Feb 1, 2008

Completed aggregate GFA of 226,718 sq m of commercial / residential space

Planned estimated GFA of additional 862,092 sq m to be completed by 2015

Total land bank : 1.54 million sq m

A Leading Zhengzhou-Based

Property Developer and Property Manager

Listing SGX Mainboard

Issued Share Capital 1,845,000,000

Free Float 13.3%

Share Price (As at Jan 27, 2011) S$0.360

Market Capitalisation

(As at Jan 27, 2011)S$664.20 mil

Net Asset Value Per Share (Dec 31, 2010)

16.05 Singapore cents

Major Shareholders

Ember Vision (Mr Li Wei & Mr Wang Peng) – 48.6%

Marble Focus (Mr Yan Tao) – 20.8%

CIM X Limited – 8.7%

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Our Portfolio (Geographical location)J-Expo 1 & 2

Small consumer goods wholesale mall

Tianrong Project

Fashion apparel wholesale mall

Jiancaigang

Wholesale mall for automobile parts and building materials

Property management services

Nongye Road Project

Mixed use development: retail and residential

Border of old city centre and new CBD

Guoling Shanshui

High-end, integrated residential development

25 km or 20 mins drive from Zhengzhou City centre; 5 km south of Yellow River, where the

Yellow River Scenic Area is located

Guoling Shanshui

Tianrong

Zhengdong New CBD

J-Expo I & II

Nongye Road

Jiancai Gang

N

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Our PortfolioLand Bank/ Site Area

(sq m)

Saleable/Leasable

Estimated GFA (sq m)

Remarks

Completed property

Commercial property

J-Expo 1 (金智●万博商城 1) 9,771 65,890 Sold and delivered 78.6% of

saleable GFA

(As at 31 Dec 2010)

Property under development Estimated Construction

Schedule

Residential property

Phase III of Guoling Shanshui (果岭山水)

Remaining land bank at Guoling Shanshui

174,412

1.5 mil

132,763

TBA

2Q 2009 – 4Q 2012

--

New projects

Commercial properties

J-Expo 2 (金智●万博商城 2) 9,000 93,000 4Q 2010 – 1Q 2012

Tianrong Project

- Tianrong Fashion City (天荣时装城)

-Old Residential Area, adjacent to Tianrong Fashion

City (旧住宅区)

24,026

16,792

553,0001

2012 – 2016

Mixed residential & retail property

Nongye Road Project (农业路项目) 16,123 100,092 4Q 2010 – 3Q 2012

Property Management

Jiancai Gang (建材港) 758,574 354,568

Tenure of 20 years:

11 Nov 2009 – 30 Jun 2028

1 Based on amalgamated site area of Tianrong Fashion City and Old Residential Area

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Financial

Review

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Income StatementRMB ’mil FY2010 FY2009 Change

Revenue 309.2 155.0 + 99.5%

Gross Profit 155.1 94.0 + 65.0%

Other Income 2.6 5.2 - 49.1%

Profit Before Tax 27.5 28.8 - 4.7%

Profit for the Year 17.4 12.2 + 43.4%

Selling Expenses 15.5 13.2 + 17.6%

Admin Expenses 104.8 51.6 + 102.9%

Effective Tax Rate 36.6% 57.9% - 21.3 ppt

Gross Profit Margin 50.2% 60.7% - 10.5 ppt

Profit Before Tax Margin 8.9% 18.6% - 9.7 ppt

Profit for the Year Margin 5.6% 7.8% - 2.2 ppt

FY: Financial year ended 31 December

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Revenue - Growing recurring income stream

FY2010 vs FY2009

Revenue growth due to:

Sales of properties recognised in FY2010

404 units in Phase III of GuolingShanshui

18 retail and 15 office units in J-Expo 1

RMB82.5 mil contributed from rental income and RMB17.8 mil from property management fee

Rental income increase due to:

Sub-leasing of space within Jiancaigang

Property management fee increased from RMB6.7 million in FY2009 to RMB17.8 million in FY2010


RMB’mil

106.3

208.941.9

82.5

6.7

17.8

0

50

100

150

200

250

300

350

FY2009 FY2010

Sale of Properties Rental Income Property Management Fees

155.0

309.2

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Gross Profit, PBT & Profit for the Year

94.0

155.1

28.8 27.5

12.2 17.3

0

20

40

60

80

100

120

140

160

FY2009 FY2010

Gross Profit PBT Profit for the Year

RMB’milGross Profit

GP increased 65% to RMB155.1 mil in

FY2010

GP margin decreased 10.5 ppt, due to

higher margins commanded by

commercial properties in FY2009

PBT

Decreased 4.5% to RMB27.5 mil in

FY2010

Profit for the Year

Up 43% to RMB17.3 mil in FY2010

Effective tax rate of 36.6% in FY2010


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* Based on post-Invitation share capital of 1,845,000,000 Shares

Balance Sheet Highlights

RMB’ mil As at 31 Dec 2010 As at 31 Dec 2009

Cash & Bank Balances 190.4 938.9

Net Assets 1,439.2 1,383.2

- Properties Held for Development 965.0 783.6

- Properties Held Under Development 501.2 138.9

- Properties Held for Sale 112.3 70.7

- Deposits Paid 300.0 120.0

Receipts in Advance (49.5) (46.3)

Interest-bearing Bank & Other Borrowings (813.0) (617.0)

Net Gearing Ratio (%) 94.6% 45.6%

NAV per Share (RMB cents) * 82.73 74.97

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Corporate Updates

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Expiry of Framework Agreement with

Warburg Pincus

Framework Agreement with Warburg Pincus

on 30 September 2010

Warburg Pincus to invest RMB650 million

Explore investment opportunities within PRC’s commercial real estate

sector

Potentially participate in Warburg Pincus’ existing wholesale assets

portfolio in China (subject to conditions)

Option for Warburg Pincus to invest up to an additional RMB650 million

(subject to conditions)

Framework Agreement between CentraLand and Warburg Pincus has

since expired as not all signing conditions pertaining to the fulfilment

of the agreement have been satisfied by 31 December 2010.

Continues to explore suitable opportunities with Warburg Pincus for

possible future collaborations/joint venture.

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Our First Commercial Project:

J-Expo 1 (金智•万博商城 1)

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Status of J-Expo 1 (金智•万博商城 1)

As at 31 December 2010

*302 units of the unsold units on level 4 and 5 were rented out as at 30 December 2010.

LevelsCompletion

Date

Total

Saleable

GFA (sq m)

UnitsNo of Units

Sold*

No of Units

Delivered*

% of GFA

Sold &

Delivered

Average

ASP/unit

(RMB/sqm)

B1, L1-L3 2Q 2008 36,2821,792 retail

units1,691 1,679 17,132

L4-L5 2Q 2008 18,297768* retail

units482 451 11,777

L6-L12 2Q 2008 11,311192 office

units162 147 6,259

Total 65,890

2,560 retail

units/192

office units

78.6%

(51,772 sq m)14,226

21.4% GFA for

lease

78.6% GFA sold

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Tianrong Project

Zhengzhou Railway Station

Zhengzhou Long

Distance Bus Station

J-Expo I

J-Expo 2

A Small Consumer Goods Wholesale Mall

Strategic location

Within walking distance to Zhengzhou Railway

station and Zhengzhou Long Distance Central Bus

Station

Located in Erqi District (二七区) within the main

wholesale centre of Zhengzhou City

In response to strong market demand

Adjacent to J-Expo 1 – well-received

Soft launch : 287.4% rate of registration of interest

7,184 downpayments to ballot for 2,500 retail units

Total site area of 9,000 sq m

Acquired for RMB150 million

Planned total leasable GFA of 93,000 sq m

Retail space: 70,000 sq m

Office space: 15,000 sq m

Others: 8,000 sq m

Retail Trading Hub (Erqi District)

Commodities Trading Hub (Railway District)

Fashion Trading Hub (Guancheng District)

J-Expo 2 (金智•万博商城 2 )

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J-Expo 2 (金智•万博商城 2 )

Started

construction:

4Q 2010

Expected

completion:

1Q 2012

J-Expo 2

J-Expo 1

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TianrongFashion

City

Old Residential

Area

Zhengzhou Long

Distance Bus Station

Zhengzhou Railway Station

Tianrong Project (天荣时装城)

A Fashion Apparel Wholesale Mall

Strategic location

Close proximity (less than 1km) to Zhengzhou Railway Station & Zhengzhou Long Distance Central Bus Station

Located within the fashion trading hub


Comprises Tianrong Fashion City and Old Residential

Area

Planned total leasable GFA of 553,000 sq m


Office space: 69,000 sq m

Others: 56,000 sq m

Landmark project in Henan Province

To be developed in stages over 5 years

To be fully integrated with supporting infrastructure

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Tianrong Project – Acquisition Status Tianrong Fashion City:

24,026 sq m

(4 land parcels)

Old Residential

Area:

16,792 sq m

Total intended

acquisition

site:

40,818 sq m

• Acquired 80%

stake in 2 land

parcels for

RMB440 million

• Acquired 80%

stake in 2 land

parcels for

RMB360 mil

• Adjacent site to

Tianrong

Fashion City

• Land cost

subject to

government

auction

• To develop

into an

integrated

commercial

development

over a 5-year

period

• Signed S&P agreement to acquire

the balance 20% interest for

RMB300 mil

- To be funded by proposed issue

of new shares

- Subject to conditions

Signed S&P

agreement to

acquire full

ownership of

Tianrong

Fashion City

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Wholesale Mall for automobile parts and building materials

Zhengzhou Tiandi Renhe acquired the master tenancy of Jiancai Gang on 30 Nov 2009

Annual rent of RMB24 million Duration of 20 years (Expiry on 30 June 2028) Contributes approx RMB80 million per year in rental income and

management fees to the Group

Signed S&P agreement to acquire full ownership and control of Jiancai Gang on 30 Sep 2010

To acquire land use rights and buildings for RMB600 million To be funded by cash and issue of new shares Subject to conditions

To derive greater revenue or returns on Jiancai Gang

Strategic Location: Within North Ring Trading Hub: one of Zhengzhou City’s 6 largest

trading hubs Approx 1,300 tenants (as at 30 September 2010) Annual turnover of approx RMB1 billion Aggregate gross floor area: 354,568 sq m Site area: 758,574 sq

Jiancai Gang (建材港)

Currently holds 80% of Zhengzhou Tiandi Renhe

Two stable income streams:

Sub-leasing

Property management

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Jiancai Gang (建材港)

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Jiancai Gang

North Ring Business District

Jiancai Gang (Geographical location)

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Nongye Road Project

Nongye Road Project (农业路项目)

Residential cum retail development

Acquired Nongye Road site

for RMB70 mil


Strategic location

At the boundary of the old city centre’s

business district and the new

Zhengdong CBD

Planned total saleable GFA

of 100,092 sq m


Residential units: 84,685 sq m

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Nongye Road Project (农业路项目)

Started construction:

4Q 2010

Expected completion:

3Q 2012

Artist Impression

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Phase I

Yongfu 雍府

Phase I

Mufu 睦府

Phase III

Guoling Shanshui (果岭山水)

Remaining site area of 1.5 mil sq m held for future development

Phase I & II (Completed and fully sold)

Phase I: GFA of approx 57,954 sq m

Phase II: GFA of approx 102,874 sq m

Phase III – Total GFA of 132,000 sq m

Stage 1: GFA of approx 43,000 sq m; construction underway

Stage 2 GFA of approx 89,000 sq m; construction underway

Phase IIXinyu Lanwan

心屿澜湾

Phase II

Huguang Shanse

湖光山色

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Remaining land bank

(1.5m sq m)

9%

76%

15%


Phase III & Beyond

Phase III development on track

Site area of 174,412 sq m

Stage 1 construction underway

Pre-sales launched in late October

Saleable GFA of 43,763 sq m

Stage 2 construction started in 4Q2010

Saleable GFA of 89,000 sq m

Remaining land bank

Total site area of 1.5 mil sq m

Land Bank (Site Area)

Phase III (Development on track)

(174,412 sq m)Phase I & II

(Completed)

(276,735 sq m)

Phase III Type of unitTargeted

Completion Date

Total Saleable

GFA (sq m)Units

No of Units Sold*

% GFA SoldAverage ASP/unit

(RMB/sqm)

Stage 1Low-rise

apartments

4Q2012

43,763 540 40475.2%

(32,900 sq m)6,000

Stage 2Townhouses/

Duplexes/ Commercial units

89,000Under

planning- - -

*As at 31 December 2010

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Remaining Land Bank

1.5 million sq m

Master Plan

Approved for development in phases

Lifestyle Development

Luxury holiday homes

Part of land bank leased out to third parties for complementary facilities

Golf course

Hotel

Commercial retail units


Phase III & Beyond

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Guoling Shanshui (果岭山水) Phase III

Artist Impressions

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Guoling Shanshui (果岭山水) Phase III

Show unit interiors

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Project Pipeline

20152009 2010 2011 2012 2013 2014

Guoling Shanshui Phase III

J-Expo 2

Tianrong Project

Nongye Road Project

Property under development

New projects

Jiancai Gang

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Project Pipeline – Total GFA

Uses Saleable/Leasable Estimated GFA (sq m)

Residential

- Guoling Shanshui Phase III

- Nongye Road Project

216,685

132,000

84,685

Retail

- J-Expo 2

- Tianrong Project

- Nongye Road Project

513,407

70,000

428,000

15,407

Office & Commercial

- J-Expo 2

- Tianrong Project

84,000

15,000

69,000

Property Management

- Jiancai Gang

354,568

354,568

Total : 1,168,660 sq m

CentraLand Limited

CENTRALAND LIMITED

Johnson Choo

Vice President

Investor Relations and Corporate Communications

Mobile: +65 94506527 / +86 15838381086

Email: [email protected]

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APPENDIX

Background:

Wholesale Trading Hubs in

Zhengzhou City, Henan Province

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About Henan Province

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Source: Google mapsSource: http://www.china-mor.gov.cn/

Connectivity in Zhengzhou

Key national transportation hub for the country’s rail, highway and air transportation

Intersection of two major trunk railways : North-South railroad line (Beijing-Guangzhou Railway) and East-West railroad line (Lanzhou-Lianyungang Railway)

Zhengzhou Railway Station is China’s largest odd cargo volume transit-shipment station and has the 2nd highest volume of passenger transit in the PRC

Located on the Beijing-Hong Kong-Macau Expressway which runs through China and the Lianyungang-HorgosExpressway, the longest West-East highway in China (1)

Henan’s expressway mileage : 4,841 km, highest amongst all Chinese provinces (1)

A total of 25 key trunk-line highways form a well-developed highway network linking Zhengzhou with other parts of PRC (2)

Sources: (1) Zhengzhou Zhengdong New District Investment Environment Study 2009 (KPMG Shanghai)(2) www.zynews.com

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Zhengzhou : Links East to the West

Zhengzhou : Capital city of Henan Province

Zhengzhou plays a crucial role in developing the Central and Western provinces

Relocation of coastal trading hubs to Zhengzhou to serve the Central and Western parts of China

Growth engine of domestic trade

Guangzhou

Wenzhou

Yiwu

Zhengzhou

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North Ring

Business

District

Railway

Business

District

Jiancai Gang

J-Expo 1 & 2

Guancheng

Business

District

Erqi Business

District

Tianrong Project

Zhengzhou’s Specialty Trading Hubs

Wenhualu

Business

District

Bishagang

Business

District

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Our Growth Opportunity

Trading Hubs & Wholesale Malls

Relatively young industry Development of wholesale malls and trading hubs in the PRC

started in the ’80s Boosted by growing consumer affluence

House wholesalers in the same industry under one roof Offers merchants from neighbouring cities/provinces a one-stop

shop option for the sourcing of goods

Modern wholesale malls to offer a wide array of integrated services Exhibition halls for trade fairs Retail shops for the display of goods Warehousing and storage of goods Strong logistics infrastructural support to facilitate the flow of goods

Development of commercial properties, in particular wholesale malls, well-supported by the local government authorities In line with drive towards urbanisation and urban renewal Boosts local economy & employment