Beijing Capital Land Announces 2016 Annual Results

Time:2017-02-21 Source: Author: Browse: Size:LargeMiddleSmall

(Hong Kong – February 21, 2017) Beijing Capital Land Ltd. (“BCL” or the “Company”, together with its subsidiaries (collectively the “Group”); stock code: 2868.HK), one of the leading integrated property developers in China, announced the Group’s annual results for the year ended 31 December 2016.


In 2016, the Group continued to execute its five-year strategy, and adhered to its mission of achieving “quality growth”. These efforts enabled the Group to achieve all-time highs in terms of operating performance. During the year, the Group’s contracted sales volume and price both increased. The Group recorded total contracted sales of RMB45.51 billion, an increase of 40% year-over-year. Contracted sales from the Group’s five core cities and Sydney accounted for 95% of the total sales. The average sales price rose a substantial 72.3% year-over-year to RMB20,000/sq.m.


Mr. Jun Tang, the President of BCL, said, “In 2016, the Groupmaintained its customer-centric focus throughout the business to improve product quality. Relying on a strategic centralized procurement platform and a standardized product platform, the Group further upgraded its standards for product quality and cost control across all construction projects, interior decoration, and raw material procurement. In addition, the Group focused on building its own property management system to improve the quality of its property services, namely Shouwan Property Services Co., Ltd., which successfully obtained its national first-class qualification, a significant breakthrough in property management. It has more than 40 projects with more than 10 million sq.m. under management, making it one of the top 10 biggest property management companies in Beijing.”



In 2016, the Group’s revenue totaled RMB20,349,404,000, representing an increase of 27% compared with the previous year. Operating profit rose 2% year-over-year to RMB3,828,663,000. Net profit attributable to owners of the Company reached RMB2,031,862,000, representing a decrease of 2% compared with the previous year, but increased by 3% as compared to the 2015 net profit attributable to owners of the Company before restatement. Basic earnings per share (EPS) totaled RMB0.67, compared with RMB0.95 in 2015. The Board resolved to recommend the payment of a final dividend for the year ended 31 December 2016 of RMB0.20 per share (2015: RMB0.20 per share).


During the year, the Group successfully launched Tian Yue Mansion and Capital of Western Village under its “Tian Yue” product line. Additionally, the Group also successfully redeveloped its “Xi Rui” series of projects, and created Xanadu Villa and Xanadu Mountain as the Company’s premium projects. The Group also worked to improve the capabilities of its in-house sales team during the year. The in-house sales team covered 60% of the Group’s self-developed projects, and contracted sales accounted for nearly 50% of total self-developed project sales. Meanwhile, the Group established contract-signing centers in Beijing, Tianjing and Chongqing to achieve unified management of sales and marketing as well as to improve both the efficiency of the contract-signing process and collections.


As for land investment, the Group continued to focus on its five core cities in China, and Australia, and mainly concentrated on building projects for homeowners who are looking to upgrade their living situation in core cities. The Group made new land investments of GFA 1.66 million sq.m. with an investment amount of RMB18.1 billion, of which, Beijing, Tianjin and Shanghai accounted for 89%, which helped to further replenish BCL’s prime land bank in core cities. Concurrently, supported by Beijing Capital Group, the Company acquired two more primary land development projects, namely the second phase of the Beijing Hujialou Project and the Pinggu Bai Ge Zhuang Project (including a shantytown renovation project), which lays a solid foundation for the Company to add prime land bank in the future. The Hujialou shantytown renovation project sits in the central business district (CBD) of Beijing, which covers a total site area of 24 hectares in CBD Beijing. This project has been the most important breakthrough in the Group’s primary land development business in recent years, and would be one of the Group’s most core land resources. During the year, the Company entered the Brisbane market, the third most populous city in Australia, through a joint venture with Brisbane’s renowned property developer, the Arden Property Group. The project was put on the market in 2016 and recorded total contracted sales of approximately RMB1.14 billion.


As for commercial property development, the Group realized stable growth in its outlets business. The Group’s four outlet projects that have already launched (Fangshan, Wanning, Huzhou and Kunshan) recorded steady growth and generated annual turnover of nearly RMB2.4 billion, an increase of 17% year-over-year. Annual foot traffic reached 19 million, an increase of 22% year-over-year. In addition, the Group acquired five more outlet projects in Xi’an, Zhengzhou, Jinan, Hefei and Chongqing. As at the end of 2016, the Group was the largest operator of outlet projects in China with 13 projects in total nationwide, laying a solid foundation to become “The Top Integrated Outlets Operator in China”.


During the year, SINO Ocean Land Holdings Ltd. and KKR & Co. L.P. made a strategic investment totaling HKD1.48 billion in Capital Juda, the Group’s red-chip listing platform. This large investment marks a significant vote of confidence from such renowned international investors and substantially bolsters the Group’s capital structure and diversifies its shareholder base. It should also help improve Capital Juda’s corporate governance and strengthen its ability to attract international attention and important business resources. All in all, the investment will provide a solid foundation for the future development of the Group’s outlets business.


In 2016, the Group successfully submitted an A-share listing application. In addition, the Group continued to take advantage of favorable opportunities driven by the abundance of liquidity to effectively lower its funding costs. The Group successfully issued private placement corporate bonds with an aggregate principal amount of RMB10 billion at an average coupon rate of 4.04%. During the year, China Chengxin Securities Rating Company also raised BCL’s corporate credit rating to AAA and affirmed a stable outlook, which supports the Group’s efforts to further reduce its financing costs.


Looking out to 2017, the Group will continue to adopt “quality growth” as its core vision and will continue focus on securing high quality resources. Taking advantage of the country’s Beijing-Tianjin-Hebei integration, the Group will leverage integrated and diversified channels to acquire land resources, and aggressively develop its business in primary land development and shantytown renovation. The Group will focus on the execution of its “Made by BCL 2020” strategy, which revolves around crafting the highest-quality projects, catering to customer demand, and supporting the property management business. The Group will accelerate its outlets business development and integrate its leading international business resources through joint ventures. BCL will also proactively push forward its A-share IPO plan in order to improve the funding platform of the Group. The Group will also make efforts to control debt levels, diversify financing channels, reduce funding costs, and optimize financial structure.