德信中國控股有限公司 Dexin China Holdings Company Limited
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德信中國控股有限公司 Dexin China Holdings Company Limited (Incorporated in the Cayman Islands with limited liability) Stock Code: 2019 2019 ANNUAL REPORT 2 Corporate Information 4 Chairman’s Statement 7 Management Discussion and Analysis 36 Biographical Details of Directors and Senior Management 42 Directors’ Report 57 Corporate Governance Report 76 Independent Auditor’s Report Contents 82 Consolidated Income Statement 83 Consolidated Statement of Comprehensive Income 84 Consolidated Balance Sheet 86 Consolidated Statement of Changes in Equity 88 Consolidated Statement of Cash Flows 90 Notes to the Consolidated Financial Statements 174 Financial Summary Dexin China Holdings Company Limited Annual Report 2019 Corporate Information EXECUTIVE DIRECTORS REGISTERED OFFICE Mr. Hu Yiping (Chairman) Cricket Square Mr. Fei Zhongmin Hutchins Drive Ms. Feng Xia P.O. Box 2681 Grand Cayman, KY1-1111 NON-EXECUTIVE DIRECTOR Cayman Islands Mr. Hu Shihao HEADQUARTERS IN THE PRC INDEPENDENT Dexin Group No. 588 Huanzhan East Road NON-EXECUTIVE DIRECTORS Jianggan District Dr. Wong Wing Kuen Albert Hangzhou Mr. Ding Jiangang Zhejiang, PRC Mr. Chen Hengliu PRINCIPAL PLACE OF AUDIT COMMITTEE BUSINESS IN HONG KONG Dr. Wong Wing Kuen Albert (Chairman) Room 4510 Mr. Ding Jiangang 45/F, The Center Mr. Hu Shihao 99 Queen’s Road Central Central REMUNERATION COMMITTEE Hong Kong Mr. Ding Jiangang (Chairman) Mr. Chen Hengliu THE CAYMAN ISLANDS Mr. Fei Zhongmin PRINCIPAL SHARE REGISTRAR AND TRANSFER OFFICE NOMINATION COMMITTEE Conyers Trust Company (Cayman) Limited Mr. Hu Yiping (Chairman) Cricket Square Mr. Ding Jiangang Hutchins Drive Mr. Chen Hengliu P.O. Box 2681 Grand Cayman, KY1-1111 AUTHORISED Cayman Islands REPRESENTATIVES Ms. Feng Xia HONG KONG BRANCH SHARE Ms. Chau Hing Ling REGISTRAR Computershare Hong Kong Investor Services Limited COMPANY SECRETARY Shops 1712-1716, 17th Floor Hopewell Centre Ms. Chau Hing Ling 183 Queen’s Road East Wanchai, Hong Kong 2 Dexin China Holdings Company Limited Annual Report 2019 Corporate Information PRINCIPAL BANKS Industrial and Commercial Bank of China, Hangzhou Economic and Technical Development Zone Branch Bank of China, Hangzhou Gaoxin Branch Bank of Communications, Hangzhou Wenhui Branch China CITIC Bank International, Hangzhou Qiantang Branch LEGAL ADVISERS As to Hong Kong law: Paul Hastings As to PRC law: Commerce & Finance Law Offices As to Cayman Islands law: Conyers Dill & Pearman AUDITOR PricewaterhouseCoopers Certified Public Accountants Registered Public Interest Entity Auditor 22/F, Prince’s Building Central Hong Kong LISTING INFORMATION Share Listing The Company’s ordinary shares were listed on the Main Board of The Stock Exchange of Hong Kong Limited (Stock Code: 2019) on 26 February 2019 COMPANY’S WEBSITE http://www.dothinkgroup.com 3 Dexin China Holdings Company Limited Annual Report 2019 Chairman’s Statement Dear Shareholders, On behalf of the Board of Directors of Dexin China Holdings Company Limited (the “Company”), I am pleased to present the audited annual results and business review for the 12 months ended 31 December 2019 (the “Period under Review”) and future outlook for 2020 of the Company and its subsidiaries (the “Group”). In 2019, faced with complex and severe internal and external situations, China continued to deepen supply-side structural reform and increase counter-cyclical adjustment, and the overall economic performance remained stable. In 2019, the property market still played an important role in China’s economy. Chinese government put forward that we should adhere to the position of “no speculation on housing”, fully implement the long-term management and regulation mechanism that is based on the city’s policies, and stabilize land prices, housing prices and expectations. The real estate market has also shown strong economic resilience, with steady growth in sales price and sales amount, and a stable and healthy development trend on the whole. During the Period under Review, faced with the changing market environment and increasingly fierce industry competition, the Group, based on the strategy of steady and balanced development, continued to improve its business structure, the synergies between different businesses and the overall operating efficiency by centering on the business development strategy of “one body, two wings”. While achieving desirable business results, we gained recognition from the industry and customers. With respect to the network development strategy, the Group continued to implement the deployment strategy of “being rooted in Zhejiang, focusing on the Yangtze River Delta, and extending to key hub cities of China” and made best efforts to develop cities with high development potentials and high-quality land resources. In 2019, the Group entered 5 new cities, adding about 4.74 million square meters of land reserve. Based on the principle of “setting production capacity by sales and directing investment by production capacity”, the Group well controlled the land acquisition cost through diversified land acquisition methods. In 2019, 38 parcels of land were acquired by means of bid, auction and listing and purchase, merger and acquisition. The Group also collaborated with third party business partners to jointly acquire several project lands. As of 31 December 2019, the Group had a business network covering 23 cities, operated 133 projects, among which the Group operated 118 projects, and held a reserve of approximately 13.42 million square meters of high-quality land (including reserves of joint ventures and affiliates). In 2019, while continuing to consolidate our leading position in the Yangtze River Delta region, the Group successfully entered the Guangdong-Hong Kong-Macao Greater Bay Area and won a number of high-quality projects in Guangzhou and Foshan. The proportion of the Group’s land reserves in high value-add cities was further increased. About 65% of the Group’s land reserves are located in the first- and second-tier cities, and about 30% are are located in the strong third-tier cities. Currently, the Group has achieved the deployment of city clusters in the Yangtze River delta, the Pearl River delta, Chengdu-Chongqing and the economic belt of middle reach area of Yangtze River. 4 Dexin China Holdings Company Limited Annual Report 2019 Chairman’s Statement In terms of business result, based on the in-depth insight into the Chinese real estate market and the implementation of a flexible business development strategy to effectively balance the size, brand and benefits, the Group achieved high- quality growth in 2019. For the year ended 31 December 2019, the Group’s contracted sales (together with joint ventures and affiliates) were approximately RMB45.08 billion, with an increase of approximately 13.8% over 2018; the contracted sales area was approximately 2.46 million square meters, with an increase of approximately 5.2% over 2018. During the Period under Review, the Group recognized revenue of about RMB9.51 billion, with an increase of about 15.8% over 2018; and the net profit of the Group was approximately RMB2,257 million with a year-on-year growth of 22.6%. During the Period under Review, the net profit attributable to the Company’s shareholders was about RMB1.56 billion, with an increase of about 7.1% over last year. With respect to brand building and product operation, based on the brand positioning of “Your Life Companion”, the Group adhered to the bottom line of craftsmanship and quality and practiced the brand image of “fine and distinctive Hangzhou workmanship”. During the Period under Review, the Group further standardized product quality and refined the full-cycle quality control process to create a new “Elegant Mansion series”, and developed five series of residential products covering demands of different levels of customers. In addition, the Group continued to improve the level of supporting services, and constantly improved the business ability to create a better life for customers relying on our “bosom friend life” and G+ residential system. We have been well recognized by our customers. During the Period under Review, the Group won a number of honors and awards, including one of The Top 10 Winners in China’s Real Estate Sector in 2019, one of The Influential Real Estate Enterprises in 2019, The Social Responsibility Award for Listed Real Estate Enterprises in China in 2019. The Group has won the title of “China’s Top 100 Real Estate Enterprises” for seven consecutive years, ranking the 60th in 2019. The Group was also listed in the top 100 real estate brands and top 50 real estate projects in China in 2019. These honors and awards highlight the Group’s market position and indicate that the Group’s business development and performance are widely recognized by the market. With respect to talent and cooperation mechanism, the Group attached great importance to talent introduction, echelon training and platform mechanism construction. We optimized the organizational structure from the following four aspects: flat structure, refined management, professionalization of talents and strengthening the construction of corporate culture, thus establishing an experienced management and operation team. We created the platform mechanism of “jointly creating, sharing and bearing” and the cooperation concept of openness, inclusiveness and win-win cooperation, so as to continuously stimulate the enthusiasm and creativity of every employee and partner. The Group completed its initial public offering (“IPO”) on 26 February 2019 and was listed on the main board of The Stock Exchange of Hong Kong Limited (the “Stock Exchange”). The IPO effectively enriched the capital needed for the future development of the Group, improved the capital debt structure, and further improved the corporate governance structure and internal control management level, laying a solid foundation for the rapid development of the Group in the next stage. In addition, in August 2019, the Group issued overseas dollar senior notes for the first time, further expanding overseas financing channels. The diversification of financing channels is conducive to the long-term and steady development of the Group and will further enhance the Group’s influence in the international capital market.