Annual Report 2009
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Evergrande Real Estate Group Limited (Incorporated in the Cayman Islands with limited liability) (Stock Code: 3333) Annual Report 2009 Contents 2 National properties layout 16 Management discussion and analysis 4 Board of Directors and Committees 16 2009 overall performance 5 Corporate and shareholder information 19 Land reserve 6 Financial summary 21 Contracted sales of properties 10 Report of the Chairman of 22 Property development the Board of Directors 71 Investment properties 10 Business review 71 Other property related businesses 10 Land reserve 72 Financial review 11 Property development and sales 74 Directors and administrative structure 11 Financial funds 78 Corporate social responsibility report 11 Business philosophy and 82 Investor relationship report brand value 83 Corporate governance report 11 Management team and 90 Report of the Board of Directors management style 99 12 Corporate governance 2009 Major awards and prizes 12 Corporate social responsibilities 101 Financial information and awards 166 Four year fi nancial summary 12 Development strategies 13 Business outlook 13 Appreciation NATIONAL PROPERTIES LAYOUT Guangdong Changsha Taiyuan 1 Jinbi Garden No. 1 29 Evergrande Palace 45 Evergrande Oasis 2 Jinbi Garden No. 2 30 Evergrande Metropolis 46 Evergrande Metropolis 3 Jinbi Garden No. 3 31 Evergrande Oasis 4 Jinbi Palace 32 Evergrande City 5 Jinbi City Plaza 33 Evergrande Atrium 6 Jinbi Emeral Court Hefei 7 Jinbi New City Garden 47 Evergrande Palace 8 Jinbi Century Garden 48 Evergrande City 9 Jinbi Bay Garden Shenyang 10 Jinbi Atrium 34 Evergrande Oasis 11 Jinbi Junhong Garden 35 Evergrande City 12 Evergrande Royal Scenic Peninsula Guiyang 49 Evergrande Oasis 13 Evergrande Scenic Garden 14 Evergrande Oasis Guangzhou 15 Evergrande Splendor Qingyuan Xi’an 36 Evergrande Metropolis 16 Evergrande Metropolis Foshan 37 Evergrande Oasis Luoyang 38 Evergrande City 50 Evergrande Oasis Chongqing 17 Evergrande Palace Nanning 18 Evergrande City Nanjing 39 Evergrande Splendor 51 Evergrande Oasis 19 Evergrande Splendor 40 Evergrande Oasis 20 Evergrande Oasis 21 Evergrande Metropolis Zhengzhou Qidong 52 Evergrande Oasis Wuhan and 41 Evergrande Splendor the adjacent area Nanchang 22 Evergrande Palace 53 Evergrande Oasis 23 Evergrande Splendor Tianjin 42 Evergrande Splendor 54 Evergrande City 24 Evergrande Oasis 25 Evergrande City Kunming Shijiazhuang 43 Evergrande Splendor 55 Evergrande City Chengdu and 56 Evergrande Splendor the adjacent area 26 Evergrande Oasis Baotou 27 Evergrande City 44 Evergrande Palace Haikou 28 Evergrande Splendor 57 Evergrande Oasis 2 Evergrande Real Estate Group Limited | Annual Report 2009 Tianjin Shenyang Baotou Shijiazhuang Taiyuan Xi’an Zhengzhou Nanjing Luoyang Hefei Wuhan Qidong Chongqing E’zhou Chengdu Meishan Nanchang Changsha Guiyang Guangdong Kunming Province Nanning Haikou Total Land Reserve 54.98 Million Square meters Evergrande Real Estate Group Limited | Annual Report 2009 3 BOARD OF DIRECTORS AND COMMITTEES CHAIRMAN OF THE BOARD OF DIRECTORS REMUNERATION COMMITTEE Hui Ka Yan Hui Ka Yan (Chairman) Yu Kam Kee, Lawrence EXECUTIVE DIRECTORS He Qi Xia Haijun (Vice Chairman and chief executive officer) Li Gang (Vice Chairman and executive vice president) NOMINATION COMMITTEE Tse Wai Wah Hui Ka Yan (Chairman) Xu Xiangwu He Qi Xu Wen Chau Shing Yim, David Lai Lixin He Miaoling AUTHORISED REPRESENTATIVES Hui Ka Yan INDEPENDENT NON-EXECUTIVE DIRECTORS Fong Kar Chun, Jimmy Yu Kam Kee, Lawrence Chau Shing Yim, David He Qi AUDIT COMMITTEE Chau Shing Yim, David (Chairman) Yu Kam Kee, Lawrence He Qi 4 Evergrande Real Estate Group Limited | Annual Report 2009 CORPORATE AND SHAREHOLDER INFORMATION CORPORATE INFORMATION SHAREHOLDER INFORMATION HEAD OFFICE LISTING INFORMATION 23rd Floor, Talent Center The shares of the Company are listed in The Stock 45 Tianhe Road Exchange of Hong Kong Limited (“Stock Exchange”) Guangzhou The senior notes of the Company are quoted in Guangdong Province Singapore Stock Exchange Limited (“Singapore Stock The PRC Exchange”) Postal code: 510075 SECURITY CODE PLACE OF BUSINESS IN HONG KONG Stock 1201 Two Pacific Place HKEX: 3333 88 Queensway, Hong Kong SENIOR NOTES WEBSITE Singapore Stock Exchange Short Name: Evergrande13% www.evergrande.com 150127A,Evergrande13%150127R Abbreviated Name: EVERN15A, EVERN15R COMPANY SECRETARY ISIN Code: US300151AA58, USG3225AAA19 Fong Kar Chun, Jimmy, Hong Kong solicitor INVESTOR RELATIONSHIP AUDITOR For enquiries, please contact: PricewaterhouseCoopers Investor relationship – Mr Fong Kar Chun, Jimmy Email: [email protected] PRINCIPAL BANKERS Telephone: (852) 22879202 / 22879218 / 22879208 Industrial and Commercial Bank of China Limited Agricultural Bank of China Limited FINANCIAL CALENDAR China Construction Bank Corporation Announcement of final results: 12 April 2010 Bank of China Limited Deadline for registration of 19 May 2010 to 24 May 2010 China Everbright Bank Limited share transfer: (both days inclusive) China CITIC Bank Corporation Limited Annual General Meeting: 24 May 2010 China Minsheng Bank Limited Distribution of final dividend: 3 June 2010 Bohai Bank Limited Bank of Communications Ltd Shanghai Pudong Development Bank Co., Ltd Evergrande Real Estate Group Limited | Annual Report 2009 5 FINANCIAL SUMMARY SUMMARY OF BALANCE SHEET As at 31 December 2009 2008 Changes Total cash (including cash and cash equivalents and restricted cash) (RMB Million) 14,378 1,918 649.0% Total assets (RMB Million) 63,071 28,523 121.1% Borrowings included in current liabilities (RMB Million) 6,360 6,214 2.4% Borrowings included in non-current liabilities (RMB Million) 7,816 4,226 84.9% Capital and reserves attributable to shareholders of the Company (RMB Million) 12,862 8,262 55.7% Total borrowings/total Assets 22.5% 36.6% -14.1% Total borrowings/total equity 110.2% 126.4% -16.2% SUMMARY OF INCOME STATEMENT For the year ended 31 December 2009 2008 Changes Revenue (RMB Million) 5,723 3,607 58.4% Gross profit (RMB Million) 1,946 1,482 31.8% Profit for the year (RMB Million) 1,117 632 77.8% Profit margin 19.5% 17.5% 2.0% Profit attributable to shareholders of the Company (RMB Million) 1,046 525 98.1% Basic earnings per share (RMB cent) 7.4 3.8 94.7% Dividend per share (RMB cent) 0.7 N/A N/A 6 Evergrande Real Estate Group Limited | Annual Report 2009 FINANCIAL SUMMARY (continued) 2006-2009 COMPARISON OF MAJOR FINANCIAL INDICATORS RMB Million Comparison of major financial indicators Total cash (including cash and cash Total assets equivalents and restricted cash) (RMB Million) (RMB Million) 15,000 14,378 80,000 63,071 12,000 60,000 9,000 40,000 6,000 28,523 21,384 3,367 20,000 3,000 2,042 1,918 7,794 0 0 2006 2007 2008 2009 2006 2007 2008 2009 Capital and reserves attributable to Revenue shareholders of the Company (RMB Million) (RMB Million) 15,000 6,000 5,723 12,862 12,000 5,000 9,000 8,262 4,000 3,607 3,167 6,000 3,000 1,983 3,000 2,000 638 0 1,000 (508) -3,000 0 2006 2007 2008 2009 2006 2007 2008 2009 Gross profit Profit attributable to the shareholders of (RMB Million) the Company (RMB Million) 2,000 1,946 1,200 1,082 1,046 1,000 1,500 1,482 1,221 800 1,000 600 557 400 326 525 500 200 0 0 2006 2007 2008 2009 2006 2007 2008 2009 Evergrande Real Estate Group Limited | Annual Report 2009 7 Leader in standardised quality property development in China REPORT OF THE CHAIRMAN OF THE BOARD OF DIRECTORS Dear shareholders, I am glad to present the fi rst annual report of Evergrande Real Estate Group Limited since our listing on the Main Board of the Stock Exchange. Revenue and gross profi t of the Group for the year were RMB5.72 billion and RMB1.95 billion respectively, or a year-on-year growth of 58.4% and 31.8%, net profi t increased by 77.8% to RMB1.12 billion. Profi t attributable to shareholders amounted to RMB1.05 billion, earnings per share amounted to RMB0.07. Majority of above results were historic high compared with the corresponding period, we carried out our commitment to shareholders and investors made at the time of our listing. In order to reciprocate the trust and support of shareholders, the Board of Directors proposed to distribute a fi nal dividend of RMB0.7 cents for 2009, and it will be distributed upon approval in the general meetings of shareholders of the Group. BUSINESS REVIEW on the Main Board of the Stock Exchange on 5 November In 2009, the Group continued with the standardised 2009. The Evergrande brand became a household name in operational model of quality properties and integrated China, the recognition and reputation of the brand reached centralised management style. As a result, multiple fold an unprecedented level. increase was achieved in several business and financial indicators, milestone was achieved in the corporate LAND RESERVE development area, and our leading position in the real estate The Group adopted a forward-looking strategy and sector of China was further strengthened. focused on building up a land reserve in capital cities of those provinces in China with high economic growth, The Group achieved historic breakthrough. The huge potential of property prices appreciation. As of the Group achieved contracted sales amount of approximately end of 2009, the Group had 57 real estate projects in 25 RMB30.3 billion for the year, a year-on-year growth of major cities in China, and a land reserve of 54.98 million 402.3%, the GFA of contracted sales was approximately square meters high quality and low cost land for large scale 5.637 million square meters, a year-on-year growth of development in the coming 5 years. 396.5%; revenue and gross profit for the year amounted to approximately RMB5.72 billion and approximately RMB1.95 The Group continued to put emphasis on those Chinese billion respectively, or a year-on-year growth of 58.4% and cities with high growth and those zones with beautiful 31.8% respectively, net profit attributable to shareholders environment, good planning and well developed increased by 98.1% to RMB1.05 billion; total cash (including transportation network and great potential of land prices cash and cash equivalents and restricted cash) amounted to appreciation and obtained a large land reserve of high RMB14.38 billion, a year-on-year growth of 649.0%.