2019 Annual Results Announcement April 2020 Disclaimer DISCLAIMER This document has been prepared by Central China Real Estate Limited (the "Company") solely for use at this presentation held in connection with investor meetings and is subject to change without notice. The information contained in this presentation has not been independently verified. No representation or warranty, express or implied, is made and no reliance should be placed on the accuracy, fairness or completeness of the information presented. The Company, its affiliates, or any of their directors, officers, employees, advisers and representatives accept no liability whatsoever for any losses arising from any information contained in this presentation or otherwise arising in connection with this document. 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The distribution of this document may be restricted by law, and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. 2 Disclaimer Company Representatives Chairman Mr. Wu Po Sum Mr. Yuan Xujun Mr. Felix Wang Chief Executive Officer & Executive Director Executive Director Mr. Vinh Mai Mr. Hu Ping Head of Investor Relations Chief Financial Officer & Chief Investment Officer 3 Introduction Agenda Overview 5 Results Highlights 8 Business Operations 18 Land Bank 26 Development & Sales Plans 29 Market Review & Outlook 36 4 Agenda Overview 2019 Financial Results Summary Revenue increased by 108.1% to RMB30,767 mn, (excluding attributable revenue from JCEs of RMB3,799 mn) Total recognized GFA amounted to 4.51mn sq.m., up 140.8% Recognized ASP decreased by 11.1% to RMB6,472 per sq.m., due to product mix changes Gross profit increased by 57.2% to RMB8,005 mn, achieved gross profit margin of 26.0% EBITDA RMB6,936 mn on higher gross profit, up by 101.0% Achieved net profit of RMB2,416 mn, up 70.7% Net profit attributable to equity shareholders was RMB2,015 mn, up 74.6% Declared final dividend of HK$31.00 cents per share (equivalent to RMB28.44 cents per share) for 2019, together with interim dividend of HK$15.60 cents, with full year dividend of HK$46.60 cents 5 Overview Source: Company data Overview 2019 Operational Achievements In 2019, contracted sales increased by 33.8% to RMB71.8 bn, achieved 113% of full year target of RMB63.5 bn; contracted sales from light asset projects amounted to RMB29.3 bn, achieving total contracted sales of RMB101.1 bn, up 39.8% In 2019, contracted sales GFA increased by 23.7% to 9.19 mn sq.m and contracted sales GFA from light asset projects amounted to 5.15 mn sq.m., achieving total contracted sales GFA of 14.34 mn sq.m., ranked No.10 in China* Market share in Henan reached 11.2% in 2019, up 2.2 p.p. 2019 contracted ASP was RMB7,051/sq.m., up 7.4% As at 31 Dec 2019, unrecognized contracted sales amounted to RMB80.9 bn, including RMB 63.5 bn at the consolidated level (up 59.0%) and RMB17.4 bn at JCEs (up 58.5%) As at 31 Dec 2019, successfully secured management contract with 163 third-party projects of approximately 23.94 mn sq.m. of GFA, estimated unrecognized management fees from light-asset project management segment amounted to RMB2,953 mn 6 Overview Source: Company data, *CRIC Agenda Overview 5 Results Highlights 8 Business Operations 18 Land Bank 26 Development & Sales Plans 29 Market Review & Outlook 36 7 Agenda Financial Highlights Revenue increased by 108.1% to RMB 30,767 bn, primarily due to the increase in the number of property projects delivered Gross profit increased by 57.2% and achieved gross profit margin of 26.0%; the decrease in gross profit margin was mainly due to the product mix and the proportion sales of carpark with high gross decreased EBITDA increased by 101.0% to RMB6,936 mn on higher gross profit Net profit increased by 70.7% to RMB2,416 mn, net profit margin at 7.9% Basic EPS increased by 66.5% to RMB73.75 cents 2019 2018 Change Revenue (RMB mn) 30,767 14,783 +108.1% Gross profit (RMB mn) 8,005 5,091 +57.2% Gross profit margin 26.0% 34.4% - 8.4 p.p. EBIT (RMB mn) 6,638 3,183 +108.5% EBIT margin 21.6% 21.5% +0.1 p.p. EBITDA (RMB mn) 6,936 3,451 +101.0% EBITDA margin 22.5% 23.3% -0.8 p.p. Income tax (RMB mn) 2,701 1,557 +73.5% Net profit (RMB mn) 2,416 1,415 +70.7% Net profit margin 7.9% 9.6% -1.7 p.p. Net profit attributable to equity shareholders (RMB mn) 2,015 1,154 +74.6% Basic earnings per share (RMB cents) 73.75 44.30 +66.5% Diluted earnings per share (RMB cents) 72.34 43.51 +66.3% 8 Results Highlights Financial Highlights (cont’d) Recovering on profitability Gross Profit Net Profit RMB mn % Gross Profit Growth RMB mn % Net Profit Growth 43.1% 55.2% 57.2% 122.5% 70.7% -10.0% -17.8% 57.4% -16.0% -46.7% 8,005 2,416 5,091 1,415 3,281 2,788 2,293 804 899 404 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Gross Profit Margin & Net Profit Margin Dividend per Share & Earnings per Share Percentage Percentage DPS % of yoy Growth EPS % of yoy Growth 101.2% 119.5% 2015-2019 GPM Ave. 27.3% 73.1% 34.4% 66.5% -14.6% 33.5% 73.75 26.0% 24.1% 23.6% -9.5% 22.2% -49.8% 44.30 46.60 2015-2019 NPM Ave. 7.5% 32.84 33.19 9.6% 7.9% 6.4% 6.5% 16.50 21.28 4.3% 11.61 12.29 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 ） DPS(HKD cents) Gross Profit Margin Net Profit Margin Basic EPS(RMB cents 9 Results Highlights Source: Company data Recognized Sales and GFA sold In 2019, revenue and recognized property sales increased substantially as a result of the surge in recognized GFA Revenue and Property Sales Recognized GFA RMB mn Revenue up 108.1% sq.m. Revenue 2015-2019 CAGR 25.1% Recognized property sales up 114.0% 4,505,917 Property Sales 2015-2019 CAGR 24.1% 30,767 29,161 2,329,226 2,037,117 12,563 13,879 14,783 1,752,945 1,871,076 13,211 13,629 12,287 9,495 9,120 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Revenue Property Sales Recognized Average Selling Price Recognized ASP by Property Type RMB per sq.m. RMB per sq.m. Down 11.1% due to Residential ASP up 1.4% yoy product mix change 2015-2019 Ave. ASP RMB6,093/sq.m. 15,863 7,284 6,472 11,579 5,993 5,672 5,042 10,241 10,221 8,489 5,802 5,781 5,860 4,673 4,924 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Residential Commercial 10 Results Highlights Source: Company data Recognized Sales and GFA sold (Breakdown by Cities) Zhengzhou projects accounted 15.4% of total recognized sales to RMB4,311mn, with average GP margin of 30.5% Tier 3 & 4 cities contributed 74.0% of total recognized sales with average GP margin of 29.6% County level cities accounted for 10.7% of total recognized sales with average GP margin of 25.2% Recognized Sales in 2019 Recognized Sales in 2018 Zhengzhou Zhengzhou 15% 20% Others Others 34% Zhumadian 13% 38% Luoyang 14% Xinxiang 9% Xinxiang Jiaozuo Zhoukou Nanyang Xuchang Hebi Zhoukou 8% 6% Luoyang 9% 4% Zhumadian 6% 5% 6% 8% 5% Recognized GFA Recognized ASP (excluding carpark) RMB per sq.m. 2019 2018 2019 2018 16% 11% 13,046 13,766 11% 10% 10% 9% 9% 8% 8% 6% 7% 6% 5% 6,613 4% 5,477 4,986 5,195 Tier 2 Tier 3-4 County Tier 2 Tier 3-4 County (Zhengzhou) (Zhengzhou) Hebi Jiaozuo Anyang Luoyang Luoyang Xinxiang Xinxiang Xuchang Zhoukou Nanyang Zhengzhou Zhengzhou Zhumadian Zhumadian 11 Results Highlights Source: Company data Cost Analysis Cost of Sales (as % of revenue) SG&A (as % of contracted sales) Stable cost structure SG&A as % of contracted sales RMB mn 8.1% 6.4% 5.8% 5.1% 5.0% 77.8% 1.8% 75.9% 76.3% 74.2% 2.5% 1.5% 1.0% 4.2% 4.7% 65.5% 3.7% 0.8% 1.1% 3,623 1.0% 2,741 52.7% 49.8% 52.7% 55.5% 47.9% 1,784 197 1,281 1,287 138 68 68 80 19.1% 19.9% 17.4% 15.8% 16.6% 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Land acquisition Construction & dev.