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New World China Land 00917
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| Chairman |
Cheng Kar-shun Henry |
| Issued Capital (Shares) |
5,763M |
| Par Value (HKD) |
0.100 |
| Market Capitalization (HKD) |
9,739M |
| Corporate Profile |
Principally engaged in investment and development of property projects in the People・s Republic of China (the ．PRC・).
Business Review - For the year ended June 30 2011
In 2010 the China property market continued to expand with its economic growth since the market rebound in the second quarter of 2009. The soaring property prices and transaction volumes led the Central Government to launch a series of property tightening measures in April 2010 in an effort to contain property prices and second round of tightening measures were launched when the property market revived again in September 2010. Faced with the pressure of market tightening policies the Group・s secured contracted sales volume dropped by 19% to approximately 1065000 sq. m. gross floor area (：GFA；) during the year under review compared to contracted sales secured in last year. Nevertheless gross sales proceeds of contracted sales during the year increased by 31% to RMB13.325 billion despite the drop in GFA sold reflected the overall market price surge predominately in first-tier cities such as Beijing Shanghai and Guangzhou. Included in the contracted sales secured during the year approximately 326000 sq.m. with gross sales proceeds of approximately RMB4.759 billion are for those projects scheduled to be completed within the next 12 months and their corresponding sales revenues shall be recorded in the consolidated income statement of FY2012.
During the year under review the Group recorded a net profit of HK$3.146 billion which represents a year-on-year increase of 19% from a net profit of HK$2.641 billion achieved in FY2010. The Group・s core profit for the year excluding various fair value gains and non-recurring items was HK$2.903 billion had increased substantially by more than three folds comparing to last year・s HK$0.709 billion. The leading factors contributing to the increase in core profit were the improvement in operating results from sale of properties and hotel operation as well as recognition of exchange gains resulted from appreciation of Renminbi by approximately 5% during the year under review. Whereas for FY2010 the net profit achieved consist of a substantial amount of fair value gains arose from a number of equity buyout exercise undertaken last year. The Group・s attributable operating profit (：AOP；) before finance costs and taxation charge during FY2011 recorded a substantial increase of 137% to HK$4.296 billion from HK$1.812 billion recorded last year which was mainly attributable to great performance in property sales operation as a result of 26% increase in recorded property sales volume with the increase in project completion and the improvement in overall gross profit margin by 7 percentage points.
Property sales
During the year under review the Group・s AOP from property sales rose 175% from an AOP of HK$1450.08 million achieved in FY2010 to HK$3993.16 million. The significant increase in AOP from property sales was mainly attributable to increase in both recorded sales volume largely from sales of Shanghai Zhongshan Square Shenyang New World Garden Wuhan Changqing Garden Guangzhou New World Oriental Garden and Guangzhou Covent Garden and continuous improvement in overall gross profit margin comparing to last year. During the year under review the Group・s recorded property sales volume reached 1307329 sq. m. a 26% year-on-year increase with gross sale proceeds increased by 63% to approximately RMB12.971 billion. The AOP from property sales in FY2011 have not been much affected by the property tightening measures rolled out during the year under review as over one-third of the property sales revenue were secured after the market rebound in the second quarter of 2009 and before April 2010 when the property market was heated with domestic and foreign demands. Furthermore the market revival in September 2010 after four months of slow activity boosted the Group・s recorded property sales further in the fourth quarter of 2010 and months before the financial year end of 2011.
In FY2011 the Group・s overall gross profit margin had improved to 33% an increase of 7 percentage points from a gross profit margin of 26% achieved in FY2010. The improvement in achieved gross profit margin was mainly attributable to the surging selling price due to improved market sentiment and difference in sales mix between the two financial years where the residential projects completed and recorded in FY2010 were mainly located in the second-tier city such as Chengdu Changsha and Guiyang which were lowered-priced.
In FY2011 the Group has completed 10 property development projects in Shenyang Anshan Shanghai Wuhan Chengdu Guangzhou and Guiyang with a total GFA of 1364214 sq. m. representing an 86% increase year-on-year.
Rental operation
In FY2011 the Group・s rental operation recorded an AOP of HK$442.13 million a 10% decrease compared to FY2010. The decrease in AOP from rental operation was mainly due to reduction of turnover rent rate upon renewal of tenancy at Beijing New World Centre shopping mall and decrease in rentable area of service apartment and office space at Beijing New World Centre upon sales. Meanwhile massive renovation of shopping arcade of Shanghai Hong Kong New World Tower undergoing during the year and the pre-matured operating results of Wuhan K11 Gourmet Tower and Beijing Baoding Tower shopping mall also led to the decrease in AOP from rental operation of the year under review.
Hotel operation
During the year under review the AOP from hotel operation recorded at a loss of HK$56.02 million as compared to a loss of HK$97.73 million recorded last year. The continuing improvement in operating results from hotel operation was attributable to the continuing growth in hotel performance and gross operating profit of the Group・s hotels.
The Group・s hotel portfolio currently comprises seven hotels with 2547 rooms.
Hotel management services
During the year under review the AOP from hotel management services recorded at a loss of HK$63.88 million as opposed to a profit of HK$6.63 million achieved in FY2010. The continuous growth in gross hotel management fee had mitigated the effect of increase in operating costs. However the AOP from hotel management services posted a larger loss comparing to last year was mainly due to fee for buyout of hotel management contracts incurred during the year.
Source: New World China Land (00917) Annual Results Announcement |
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Copyright 1999-2001 SHK Financial Data Limited
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Last Updated: 5 Oct 2011
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