Excellent performance in property development and investment; Revenue and core net profit gained a significant increase of 67% and 220% respectively
HONG KONG — Joy City Property Limited (“Joy City Property” or the “Company”, Stock Code: 00207) announce the consolidated results of the Company and its subsidiaries (the “Group”) for the year ended 31 December 2017 (the “Period”).
Results Summary:
– Total revenue was RMB 11,700 million, increased by 67% YOY
– The core net profit amounted to RMB 1,900 million, representing a YOY increase of 220%
– Core net profit to shareholders increased by 163% to RMB 800 million
– EBITDA was RMB 4,200 million, increased by 58% YOY
– The total interest-bearing liabilities were 21,700 million, and the net debt ratio was 28%, a decrease of 1.87%
– The average financing cost was 4.28%
– Settlement area was 147,873 sq.m., representing an increase of 116% YOY
– Contracted sales amount was approximately RMB8,156 million and contracted area was 242,498 sq.m., representing an increase of 79% and 158% respectively YOY
During the reporting period, due to the excellent performance from property development and investment properties rental, the group’s total revenue was RMB 11,700 million, increased by 67% YOY; The core net profit amounted to RMB 1,900 million, representing a YOY increase of 220%; Core net profit to shareholders increased by 163% to RMB 800 million; EBITDA was RMB 4,200 million, increased by 58% YOY; The total interest-bearing liabilities were 21,700 million, and the net debt ratio was 28%, a decrease of 1.87%.
In 2017, the Group achieved relatively steady performance in the four main segments such as property investment, property development, hotel operation, property management and related services.
For investment properties business, in 2017, the Group’s investment properties were in good operation condition, and the operational efficiency of Joy City was significantly improved, as a result of which, it recorded rental income of approximately RMB 2,300 million, with a year-on year increase of 11%. Merchants’ sales reached RMB 16,100 million, increased by 10% YOY; The number of members is 2.9 million, increased by 35% YOY, and the Passenger flow is 130 million, which continued to increase steadily. In December 2017, Joy City Property released the second product line “Joy Breeze”, insisting on “warmth, fashion, cozy and taste” and positioning it as a regional fashion life center, further improving the layout of commercial product lines. “Joy City Shopping Spree Festival” started jointly in nine cities, creating an online and offline shopping carnival through its own platform. During the festival, member consumption accounted for 54.8%, 13,000 new members were admitted on a single day, 68 branded tenants became the national top sellers, and 319 branded tenants became the city’s top sellers.
For property development business, the Group continued to produce products and customer services of high quality, resulting in a favorable market response. With the strong product power of Hainan COFCO Hong Tang Joy Sea, the LOFT products sold pretty well and the second phase sold quickly after being released. With a good geographical location and complete business supporting facilities, Hangzhou Joy City Bo Yue was favored in the market, and sold out during the opening. During the period under review, the project recorded contracted sales area of 240 thousand sq.m., increased by 158% YOY, with contracted sales amount of RMB 8,200 million, increased by 79% YOY.
For hotel operation business, the operating performance of hotel business maintained steady growth, since the Group continued to reinforce its brand positioning with our unique hotel features and increasingly improved service. For example, the St. Regis Sanya Yalong Bay Resort achieved a record high in its room sales, by establishing a healthy and stable pricing system, expanding into markets outside Hainan Island, enhancing coordination between sales and revenue management. During the period under review, the project recorded year-on-year increase in various performance indicators with EBITDA by 6%. The Group further optimized its asset structure and sold the shares of Suzhou Gloria, Nanchang Gloria; the transaction price was about RMB 400 million and completed W Beijing-Chang’ an ‘s listing; the transaction price was about RMB 1,400 million.
For property management and related services business, the Group continued to take the concept of “Green, Environmental Protection, Science and Technology, Humanities and Health” as guidance and further refined the development of EISS platform to develop a “smart green” property management system in all aspects to maximize the value of its properties.
Looking to the future, the Vice President of COFCO Group, the Chairman of Joy City Property Limited, Mr. Zhou Zheng said: “With the development of e-commerce and technological progress, the trend of experiential consumption focusing on consumer participation, experience and feelings, and that requires more space and environment has become the mainstream creative theme. In addition, with the further development of “popular entrepreneurship and innovation”, the wide spread of “internet thinking” and the extensively application of new science and technologies, new business models, like shared commercial offices and long-term rental apartments, are emerging rapidly, which is becoming a new market for the commercial real estate and encourages its innovation and development. Looking forward, the Group will continue to maintain the two-wheel-drive development strategy of holding and selling properties under a balanced approach and uphold the business approach of “cohesiveness, system optimization, overall acceleration and leapfrog development”, adhered to innovation and development to strengthen and enhance the position of Joy City in the city complex development by leveraging on its advantages in operating commercial properties and combining financial capital with Internet thinking, and to achieve our aim to build Joy City a long-lasting brand in the property industry in the PRC.”