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Aoyuan Announces 2017 Annual Results
Contracted Sales surged by 78% Y-o-Y to RMB45.6 billion
Total Borrowing Costs Continues to Decrease
Proactively Replenishes Land Bank with a Full Coverage in Big Bay Area
 Date:2018-03-15

Financial Highlights

 

RMB million

For the year ended 31 December

2017

2016

Change

Contracted sales

45,590

25,602

+78%

Revenue

19,115

11,827

+62%

Gross profit

5,111

3,277

+56%

Net profit

1,952

1,007

+94%

Core net profit*

1,889

1,223

+55%

Total dividend (RMB cents per share

25

15

+67%

*Excluding non-recurring profits and loss items and their related tax expenses, comprising fair value gain on investment properties, net exchange gain/ loss and loss on early redemptions of senior notes, etc.

 

(15 March 2018 - Hong Kong) China Aoyuan Property Group Limited (“Aoyuan” or the “Company”; Stock Code: 3883), a renowned property developer in China, is pleased to announce its audited consolidated annual results for the year ended 31 December 2017.

 

Robust and Sustainable Sales Growth with Improved Profitability

In 2017, Aoyuan recorded contracted sales of approximately RMB45.59 billion with an increase of 78% y-o-y and achieved 137% of its full-year target, maintaining strong growth momentum. Besides, monthly sales in December 2017 exceeded RMB10 billion. Contracted sales in the Guangdong-Hong Kong-Macau Big Bay Area was encouraging and reached approximately RMB24.28 billion, accounting for 53% of total contracted sales.

 

During the year, Aoyuan continued to achieve steady growth in profitability. Revenue increased by 62% y-o-y to RMB19.12 billion. Gross profit increased by 56% y-o-y to RMB5.11 billion, and gross profit margin was 26.7%. Net profit increased by 94% y-o-y to RMB1.95 billion, and net profit margin was 10.2%. Core net profit increased by 55% y-o-y to RMB1.89 billion, and core net profit margin was 9.9%. To thank Aoyuan’s shareholders for their longstanding support, the Board recommended a final dividend of RMB25 cents per share, representing a dividend payout ratio of 40%.

 

Proactive Land Bank Replenishment with a Full Coverage in Big Bay Area

In 2017, Aoyuan acquired a total of 58 quality projects through acquisitions and land auctions, etc., with newly added GFA for development of approximately 12.86 million sq. m. Based in Guangdong, Aoyuan has achieved full coverage in the “9+2” cities of the Big Bay Area. The Company has a total of 50 projects in Big Bay Area with total GFA of approximately 7.53 million sq. m. As of 31 December 2017, total GFA of Aoyuan’s land bank was approximately 24.87 million sq. m. with total saleable resources of approximately RMB282.3 billion, laying a solid foundation for achieving higher sales targets in the coming two years.

 

Aoyuan has a total of 16 redevelopment projects with planned total GFA of approximately 10.53 million sq. m. in Big Bay Area and other regions, further diversifying its land acquisition channels. Of which, 13 projects are located in Big Bay Area with planned total GFA of approximately 5.55 million sq. m.. All projects are progressing smoothly as planned.

 

Diversified Financing Channels and Successful Inclusion in Shenzhen-Hong Kong Stock Connect

Committed to diversifying its financing channels, Aoyuan has established a proven track record in the capital markets. In January 2017, Aoyuan became the first Asian issuer to complete 6.35% USD senior notes at par due 2020 which was 10 times oversubscribed. In September 2017, the Company issued 5.375% USD senior notes at par due 2022 which was 12 times oversubscribed. This is by far the lowest cost of USD senior notes issued by Aoyuan. In February 2017, the Company secured a three-year dual currency club loan of approximately HK$1.5 billion with the interest rate of LIBOR/HIBOR +4.5% per annum from Hang Seng Bank, Nanyang Commercial Bank, Bank of East Asia, Chong Hing Bank, Chiyu Banking Corporation and Wing Lung Bank. In March 2018, the Company also secured a three-year dual currency club loan of approximately HK$1.6 billion with the interest rate of LIBOR/HIBOR +3.95% per annum from Nanyang Commercial Bank, Hang Seng Bank and China Minsheng Bank Hong Kong Branch.

 

In September 2017, Aoyuan was successfully included in Shenzhen-Hong Kong Stock Connect. With soaring share price, Aoyuan has become one of the best performing HK-listed PRC developers. Being included in the Shenzhen-Hong Kong Stock Connect has further enhanced the liquidity of Aoyuan’s shares, optimized shareholders structure and raised brand awareness, reflecting Aoyuan’s long-term corporate value.

 

Well Recognized for Solid Financial Position

Aoyuan upholds prudent financial management while lowering its borrowing costs and optimizing its debt structure. As of 31 December 2017, the net gearing ratio of the Company was 51.0% at a reasonable industry level, and total borrowing costs further decreased to 7.2% from 8.1% at the end of 2016.

 

Benefiting from its robust business growth and a healthy financial profile, Aoyuan became the only PRC developer with credit rating upgrades by all three major international rating agencies, namely Fitch, Moody’s, and Standard & Poor’s since 2016. The Company’s domestic corporate rating has also been upgraded by United Credit Ratings, reaffirming confidence in Aoyuan’s profitability and comprehensive strength from both capital markets and the public.

 

2018 Outlook

Aoyuan management commented, “In 2017, Aoyuan surpassed its full year sales target by accurately grasping market opportunities.  Aoyuan has consistently outpaced the industry average with a CAGR of 54% from 2012 to 2017 in terms of contracted sales. Looking ahead, Aoyuan will adhere to a balanced city layout with a main focus on the Big Bay Area, while further expanding in East China and core regions of Central and Western China. Furthermore, Aoyuan continue to focus on Tier 1 and 2 cities and its surrounding city clusters, and to establish a strong presence in each market. Aoyuan strives to achieve rapid and high-quality growth, thus delivering fruitful returns to its shareholders and investors.”

Aoyuan Management Announces 2017 Annual Results

Aoyuan 2017 Annual Results Investors Presentation

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