March 2019 Disclaimer
This presentation may contain forward-looking statements. Any such forward-looking statements are based on a number of assumptions about the operations of the Kaisa Group Holdings Limited (the “Company”) and factors beyond the Company's control and are subject to significant risks and uncertainties, and accordingly, actual results may differ materially from these forward-looking statements. The Company undertakes no obligation to update these forward-looking statements for events or circumstances that occur subsequent to such dates. The information in this presentation should be considered in the context of the circumstances prevailing at the time of its presentation and has not been, and will not be, updated to reflect material developments which may occur after the date of this presentation. The slides forming part of this presentation have been prepared solely as a support for discussion about background information about the Company. This presentation also contains information and statistics relating to the China and property development industry. The Company has derived such information and data from unofficial sources, without independent verification. The Company cannot ensure that these sources have compiled such data and information on the same basis or with the same degree of accuracy or completeness as are found in other industries. You should not place undue reliance on statements in this presentation regarding the property development industry. No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of any information or opinion contained herein. It should not be regarded by recipients as a substitute for the exercise of their own judgment. Information and opinion contained in this presentation may be based on or derived from the judgment and opinion of the management of the Company. Such information is not always capable of verification or validation. None of the Company or financial adviser of the Company, or any of their respective directors, officers, employees, agents or advisers shall be in any way responsible for the contents hereof, or shall be liable for any loss arising from use of the information contained in this presentation or otherwise arising in connection therewith. This presentation does not take into consideration the investment objectives, financial situation or particular needs of any particular investor. It shall not to be construed as a solicitation or an offer or invitation to buy or sell any securities or related financial instruments. No part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. This presentation may not be copied or otherwise reproduced. This presentation does not constitute an offer or invitation to purchase or subscribe for any securities or financial instruments or to provide any investment service or investment advice, and no part of it shall form the basis of or be relied upon in connection with any contract, commitment or investment decision in relation thereto. This presentation does not constitute an offer to sell or the solicitation of an offer to buy any securities in the United States or any other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. This presentation shall not be reproduced or circulated.
© 2019 Kaisa Group Holdings Limited. All rights reserved.
2 Contents
3
Major Achievements in 2018
Strong Contracted High Quality Land Abundant URP Sales Bank Pipeline
Contracted sales (attributable) Land bank over 24 mn sq. of RMB70.06 bn Site area of 30 mn sq. m. m. (87% attributable) 57% YoY URPs are not included in the land bank, 25% YoY 80% located in tier-1 and Contracted ASP of major tier-2 cities located in Greater Bay RMB18,261 per sq. m. 99% Area, Shenzhen and 14% YoY 54% located in the Guangzhou account for 60% Greater Bay Area, totaled Contracted GFA of 13 mn sq. m. 3.84 mn sq. m. 38% YoY
5 Major Achievements in 2018
Revenue Gross Profit GP Margin
RMB38.7 bn RMB11.1 bn Gross Profit Margin: 29.0% 18% YoY 25% YoY 1.5 ppts YoY
Net Profit Core Net Profit Margin Net Gearing Quick Ratio
RMB3.3 bn 12.2% Deleverage Up to 1.3X 8% YoY 8.6 ppts YoY 236% 1X as Dec 2017
Onshore Financing Channels Capital Market Activities Proposed Dividend
AA+ credit rating, stable outlook by Spin-off IPO of property management China Chengxin business on HKEX Main Board An interim dividend of HK3 Obtained ABS Quota over RMB9 bn: (2168.hk) cents per share (RMB mn) Proposed a final dividend of Supplier Payables 5,000 Included in Hang Seng Composite HK9 cents per share Large & Mid Cap Index and Hang Long-term Rental Apartments 3,000 Total dividend of HK12 cents Seng Stock Connect Big Bay Area per share for FY2018 Mortgage Balloon Payment 685 Composite Index Shipping Business 475 Major shareholder continuously increased stakes
6 Major Achievements in 2018
Returned to the Chinese Super League Corporate Social Responsibility
In November 2018, Shenzhen Kaisa Kaisa won the title of “The Most Influential Football Team successfully made it back Pioneer Enterprise in Precision Poverty into the Chinese Super League Alleviation”
In December 2018, Municipal Government The case of “Kaisa donated RMB220 million of Shenzhen presented a special in support of Guangdong’s Precise Poverty contribution award of RMB20 mn to Alleviation” was included in “2018 Poverty Shenzhen Kaisa Football Team in order to Alleviation Achievements Report”, making support its further development Kaisa Group the only developer to receive such an honor
Kaisa’s Brand Value Has Been Further Strengthened
7
Abundant Premium Land Bank in Tier 1 & Tier 2 Cities
Sizable and valuable land bank Western China Pan-Bohai Bay Rim 24.0 mn sq. m. of land bank by GFA with GFA: 2.8 mn sq. m. GFA: 4.2 mn sq. m. Percentage of total by GFA: Percentage of total by GFA: 17.3% attributable portion of 87% 11.8% 80% located in tier 1 and major tier 2 cities Central China 54% land bank in the Greater Bay Area GFA: 2.0 mn sq. m. GFA of over 7 mn sq. m. contributed from URPs, Percentage of total by GFA: 8.2% accounting 30% of total land bank
Land Bank by Development Status Shenyang
Completed, sold yet Completed and recognized Dalian unsold 2% Qingdao 6% Nanjing Zhengzhou Xuzhou Shanghai Under development Chongqing Suzhou Held for future 44% Wuhan Chengdu Shaoxing development Changsha 48% Foshan Guangzhou Huizhou Zhongshan Shenzhen Greater Bay Area Dongguan Zhuhai Land Bank by Land Use GFA: 13.0 mn sq. m. Sanya Percentage of total by GFA: 54.3% Commercial (Shenzhen: 3.2 mn sq. m. Yangze River Delta 12% Industrial Percentage of total by GFA: 13.1%) 2% GFA: 1.9 mn sq. m. Percentage of total by GFA: 8.0% Hainan
Residential GFA: 0.1 mn sq. m. 86% Percentage of total by GFA: 0.4%
9 Abundant Premium Land Bank in Tier 1 & Tier 2 Cities
GFA Saleable Resources % % (’000 sq. m.) (RMB mn) Greater Bay Area 13,045 54% 336,867 73% Shenzhen 3,158 13% 161,034 35% Guangzhou 1,806 7% 81,272 17% Huizhou 5,714 24% 54,286 12% Others (Dongguan, Zhuhai, 2,367 10% 40,275 9% Zhongshan, Foshan) Yangtze River Delta 1,915 8% 36,390 8% Central China 1,975 8% 31,592 7% Western China 2,836 12% 25,524 5% Pan Bohai Rim 4,169 17% 29,180 6% Hainan 87 1% 4,172 1% Total 24,027 100% 463,725 100%
24 mn sq. m. Land Bank by Region RMB464 bn Saleable Resources by Region
Pan Bohai Hainan, 1% Pan Bohai Rim, 17% Western Hainan, 1% Over 13 mn sq. China, 5% Rim, 6% RMB337 bn m. land bank in saleable resources Central China, GBA, of which 7% in GBA, of which Western URPs account for URPs account for China, 12% Yangtze River 7.3 mn sq. m. Delta, 8% RMB192 bn
Central China, Greater Bay Area, 54% 8% Greater Bay Yangtze River Area, 73% Delta, 8%
10 Land Acquisition in 2018
Newly Acquired Land by Attributable Consideration Land acquisition through merger and acquisition, Hainan Pan Bohai Rim 4% bidding and urban renewal 6% Further penetration into the Greater Bay Area with Western China 56% of the new projects in the Greater Bay Area 8%
Attributable GFA of 3.32 mn sq. m. with an average Central China Greater Bay Area land cost of RMB4,750 per sq. m. in 2018 15% 56%
Yangtze River Delta 11% Land Acquisition in 2018 Attributable Attributable Attributable Site Area GFA Region Cities GFA Consideration Land Cost (sq. m.) (sq. m.) (sq. m.) (RMB mn) (RMB/sq. m.) Shenzhen, Guangzhou, Greater Bay Area Huizhou, Zhuhai, Foshan, 406,911 1,206,720 928,168 8,775 9,455 Zhongshan Shanghai, Suzhou, Ningbo, Yangtze River Delta 284,972 375,774 212,532 1,673 7,872 Xuzhou, Shaoxing Changsha, Hengyang, Central China 240,880 1,028,812 653,481 2,351 3,598 Ezhou, Xinxiang Chengdu, Chongqing, Western China 219,860 599,583 566,177 1,223 2,161 Pengzhou Bazhou, Gu’an, Dalian, Pan Bohai Rim 417,503 942,967 891,233 984 1,104 Suizhong Hainan Sanya 79,528 86,917 69,883 771 11,034
Total 1,649,654 4,240,773 3,321,474 15,778 4,750
11 Urban Renewal Projects Pipeline
Site area of 30.0 mn sq. m. URP pipeline is not included in the land bank (plot ratio not yet calculated) with 99% of them located in Greater Bay Area Converted GFA of approximately 570,000 sq. m. from Dongmendao project in Shenzhen, Xiaoping village project in Guangzhou and Lake View Waldorf Garden (new phase) in Zhuhai into land bank in 2018 Converted GFA of approximately 940,000 sq. m. every year in the past 10 years (2008-2018)
URPs Breakdown by Cities
Site Area1 % of Total City (‘000 sq. m.) Site Area Foshan Dongguan Zhuhai Shanghai 0.4% 0.6% 0.4% 0.5%
Greater Bay Area 29,902 99.5% Huizhou Shenzhen 9,542 31.8% 11.4% Guangzhou Guangzhou 9,510 31.6% 31.6% Zhongshan 6,990 23.3% Zhongshan Huizhou 3,430 11.4% 23.3% Others (Zhuhai, Dongguan, Shenzhen 430 1.4% Foshan) 31.8% Shanghai 155 0.5% Total 30,057 100.0%
1.Not yet included in the land bank, plot ratio not yet calculated
12 A Pioneer in Greater Bay Area
Pioneer of Urban Renewal in Greater Bay Area Site Area1 URP Pipeline City Prominent Strategic Value (‘000 sq. m.) (# of projects)
“Urban Integrated Operator” in the era of Shenzhen 9,542 81 Greater Bay Area Guangzhou 9,510 12 Zhongshan 6,990 16 Trillions worth of project pipeline to meet the Huizhou 3,430 4 development needs of core cities Dongguan 170 3 Unlock the value of scarce land resource Foshan 133 1 Zhuhai 127 2 Total 29,902 119 1: Not included in the land bank, and plot ratio is yet calculated
Guangzhou: International Business Centre, Transportation and Logistics Hub in Southern China East Coast of Pearl River Region, International Metropolis Delta: Electronic Shenzhen Information Industry Cluster Zhaoqing Guangming Longgang Longhua Pinghu Pingshan Guangzhou Huizhou Bao’an Bantian West Coast of Pearl River Buji Henggang Dapeng Delta: High-end Foshan Dongguan Nanshan LoWuYantian Equipment Manufacturing Nan’ao Industry Cluster Shenzhen Shenzhen: Technology Futian Zhongshan Innovation Center with Jiangmen Hong Kong Global Influence Projects in land bank Zhuhai Macau Urban Renewal Projects
Guangzhou-Shenzhen-Hong Kong Express Rail Link (In Operation/ full journey 48 mins / from Hong Kong to Guangzhou–Dongguan - Shenzhen intercity railway (Operated in 2019/ full journey 60 mins) Shenzhen 14 mins) Shenzhen–Zhongshan Bridge (Operated in 2024/ full journey 30 mins) Hong Kong - Zhuhai -Macau Bridge (in operation/ full journey 30 mins) Humen Pearl River Bridge (In Operation) Humen No.2 Bridge (Operated in 1H2019/ from Dongguan to Panyu shortened by 10 km)
13
Development Strategies for 2019
Precise, Increase asset churn rate standardized and Expedite conversion of Enhance Increase in URPs intelligent Operation Saleable management Efficiency Resources Optimise investment in Enhance profitability strategically-focused regions
Accelerate cash Expand onshore funding collection Reduction Diversify in Funding channels (eg. ABS) Joint development Leverage Channels Broaden PRC lenders base Optimise capital Co-investment with strategic structure partners Lower funding cost
15 Saleable Resources in 2019
Saleable Value in 2019 Saleable Area in 2019
Tier 3 Tier 3 Tier 1 6% 16% 17%
Tier 1 46%
Tier 2 48%
Tier 2 67% Saleable Value in 2019 =RMB158.0 bn Saleable Area in 2019 = 8.8 mn sq. m.
Pan Bohai Rim Central China Pan Bohai Rim 10% Western China 6% 4% 7% Central China 9%
Yangtze River Delta Western China 13% Greater Bay 12% Area Greater Bay 57% Area Yangtze River 70% Delta 12%
~70% Saleable Resources from Greater Bay Area
16 Strategic Positioning in Greater Bay Area
Guangdong-Hong Kong-Macao Greater Bay Area
A vibrant world-class city cluster
Guangdong-Hong International technology innovation Kong-Macao centre with global influence Greater Bay Area Tokyo Bay New York Area An important pillar for the Belt and San Francisco Bay Area Road Initiative Bay Area Demonstration area between Mainland, Hong Kong and Macao Quality living circle which is livable and good for business and tourism
Promulgation of the Outline A world-class Strong population World-class Development Plan for the comprehensive The most vibrant Complementary inflow– supported by transportation Guangdong-Hong Kong- industrial chain– economy in advantages of Macao Greater Bay Area will approximately 70 network – “one - Finance + Innovative China-Pearl the two Systems propel the development to the Technology + High-end million population hour living circle” River Delta region in next 30 years production
Greater Bay Area will become the world’s largest bay area by 2028, bringing unprecedented opportunities
17 Steady Conversion of URPs into Land Bank
URPs Converted into Land Bank in 2018 ASP of Nearby Expected Saleable Saleable Area Project Location Type Projects Value (’000 sq. m.) (RMB/sq. m.) (RMB mn) Commercial & Shenzhen Dongmendao Project Luohu, Shenzhen 30 65,000 1,950 Residence Guangzhou Xiaoping Village Project Baiyun, Guangzhou Residential 500 60,000 30,000 Zhuhai Lake View Waldorf (new phase) Xiangzhou, Zhuhai Residential 40 35,000 1,400 Total 570 33,350
Projects to Be Converted into Land Bank in Short Term (1-2 years) ASP of Nearby Expected Saleable Saleable Area* Project Location Type Projects Value (’000 sq. m.) (RMB/sq. m.) (RMB mn) Shenzhen Bailingda Project Bao’an, Shenzhen Residential 150 53,000 7,950 Commercial & Shanghai Xuhangzhen Project Jiading, Shanghai 210 40,000 8,400 Residential Shenzhen Futian Border Project Futian, Shenzhen Residential 20 100,000 2,000 Shenzhen Nanmendun Project Longgang, Shenzhen Residential 230 55,000 12,650 Shenzhen Futian Project Futian, Shenzhen Residential 105 120,000 12,600 Shenzhen Xiaxue Village Project Longgang, Shenzhen Residential 230 53,000 12,190 Shenzhen Dapeng No.2 Industrial Zone Dapeng, Shenzhen Industrial 200 45,000 9,000 Shenzhen Shangxue Project Longgang, Shenzhen Industrial 180 54,000 9,720 Shenzhen Antaiyuan Project Longgang, Shenzhen Residential 10 53,000 530 Shenzhen Pinghu Hongzhuling Project Longgang, Shenzhen Residential 300 53,000 15,900 Expected Supplies in Short Term 1,635 90,940
* Subject to government’s final approval and demolition & compensation arrangement 18 Steady Conversion of URPs into Land Bank (Cont’d)
Projects to Be Converted into Land Bank in Mid Term (3-5 years) ASP of Nearby Expected Saleable Area* Project Location Type Projects Saleable Value (‘000 sq. m.) (RMB/sq. m.) (RMB mn)
Shenzhen Xiangjiaotang Project Longgang, Shenzhen Residential 580 55,000 31,900
Shenzhen Banxuegang 08 Project Longgang, Shenzhen Residential 1,100 55,000 60,500
Shenzhen Xinli Factory Project Longgang, Shenzhen Industrial 250 48,000 12,000
Shenzhen Makengshan Porject Longgang, Shenzhen Residential 70 55,000 3,850
Shenzhen Henggang Anliang Project Longgang, Shenzhen Residential 1,050 50,000 52,500
Shenzhen Bantian 35 Wan Project Longgang, Shenzhen Residential 60 55,000 3,300
Shenzhen Xixiang Project Longgang, Shenzhen Residential 600 65,000 39,000
Shenzhen Guangming Central Area Project Guangming, Shenzhen Residential 740 55,000 40,700
Shenzhen Jianda Factory Project Longhua, Shenzhen Industrial 530 45,000 23,850
Shenzhen Guanlan Project Longhua, Shenzhen Residential 350 50,000 17,500
Shenzhen Pinghu Xuri Project Longgang, Shenzhen Residential 590 48,000 28,320
Guangzhou Shixi Village Project Haizhu, Guangzhou Residential 900 53,000 47,700
Guangzhou Lianbian Village Project Baiyun, Guangzhou Residential 1,000 52,000 52,000
Guangzhou Yagang Village Project Baiyun, Guangzhou Residential 680 52,000 35,360
Expected Supplies in Mid Term 8,500 448,480
* Subject to government’s final approval and demolition & compensation arrangement
19 Steady Conversion of URPs into Land Bank
Projects to Be Converted into Land Bank in Long Term (Over 5 years)
Site Area Project Location (’000 sq. m.)
Greater Bay Area
Shenzhen All Administrative Districts 4,500
Guangzhou Haizhu, Baiyun, Zengcheng, Panyu 4,600
Zhongshan Shaxi, Dachong, Shiqi, Henglan 6,990
Huizhou Huicheng 3,430
Zhuhai Doumen 127
Dongguan Changping 170
Foshan Lishui 133
Expected Supplies in Long Term 19,950
Unlock Trillion Worth URP Value in Long Term
20
Strong Growth in Contracted Sales
Contracted Sales (RMB mn) Contracted GFA ('000 sq. m.) Contracted ASP (RMB/sq. m.）
18,261 70,059 3,837 16,048 13,150 2,786 44,714 2,269 29,843
2016 2017 2018 2016 2017 2018 2016 2017 2018
Recognized Sales (RMB mn) Recognized GFA ('000 sq. m.) Recognized ASP (RMB/sq. m.)
36,081 17,209 31,206 2,241 2,097 13,923 1,867
16,739 8,968
2016 2017 2018 2016 2017 2018 2016 2017 2018
Strong Growth in Contracted Sales and Recognized Sales
22 Contracted Sales
By Region
Western Pan Bohai Rim Pan Bohai Rim China 8% 10% 7% Western China 8% Central China 8% Greater Bay Area Central China 12% Greater Bay Area 56% 59%
Yangtze River Delta Yangtze River Delta 21% 11%
RMB44,714 mn in 2017 RMB70,059 mn in 2018 By City Tier
Tier 3 Tier 3 5% 3%
Tier 2 Tier 1 44% 51% Tier 2 49% Tier 1 48%
RMB44,714 mn in 2017 RMB70,059 mn in 2018
~50% Tier 1 Cities Sales Contribution ~60% Contracted Sales from Greater Bay Area
23 Recognized Sales
By Region Western China Pan Bohai Rim Pan Bohai Rim Region 9% 17% 3%
Central China Western China Region Region Greater Bay 5% 7% Greater Bay Area Area Central China Region 52% 52% 3% Yangtze River Delta Yangtze River Delta 29% 23%
RMB31,206 mn in 2017 RMB36,081 mn in 2018 By City Tier
Tier 3 Tier 3 4% 15%
Tier 1 44% Tier 1 52%
Tier 2 Tier 2 52% 33%
RMB31,206 mn in 2017 RMB36,081 mn in 2018
~52% Recognized Sales Contribution from Tier 1 Cities ~52% Recognized Sales from Greater Bay Area
24 2018 Key Financial Highlights
Strong Growth Solid Profitability Improving Credit
Revenue (RMB mn) Gross Profit (RMB mn) Interest Coverage Ratio(1)
38,705 Gross Margin: 29.0% 1.7x Gross Margin: 27.3% 11,129 8,934 1.2x 32,779
2017 2018 2017 2018 2017 2018 Total Assets (RMB mn) Core Net Profit Margin(2) (RMB mn) Debt/EBITDA(3)
229,028 12.2% 11.2x
7.2x 213,388 3.6%
2017 2018 2017 2018 2017 2018
Strong Growth, Solid Profitability and Improving Credit
(1) Interest Coverage Ratio = EBITDA / Interest Expense; (2) Core Net Profit = Net profit excluding net gain on repurchase of senior notes, net fair value gain on financial assets at FVTPL, fair value gain on investment properties, net of deferred tax and net exchange gains/ losses (3) Debt/EBITDA = (Short-term Borrowings + Long-term borrowings) / EBITDA
25 2018 Key Financial Highlights
P&L and profitability (RMB mn) Balance Sheet and Credit Metrics (RMB bn) FY2017 FY2018 YoY change FY2017 FY2018 YoY change
Revenue 32,779 38,705 18% Total Assets 213 229 7%
Recognized sales 31,206 36,081 16% Total Equity 30 36 20%
Gross profit 8,934 11,129 25% Total Borrowings 111 109 2%
EBITDA(1) 9,918 15,114 52% Interest Coverage 1.2x 1.7x 0.5x Ratio(4) EBITDA Margin(2) 30.3% 39.0% 9ppts
Debt/EBITDA(5) 11.2x 7.2x 4.0x Net Profit 3,044 3,294 8%
Quick Ratio(6) 1.0x 1.3x 0.3x Core Net Profit(3) 1,171 4,729 304%
Strong Growth Momentum Improved Credit Metrics Healthy Profit Margin Improved Liquidity Scale Expansion
(1) EBITDA = Profit or loss for the period, changes in fair value of investment properties, changes in fair value of financial derivatives, net fair value change on financial assets at FVTPL, waiver of other payables, net gain on repurchase of senior notes, net finance cost (excluding net exchange gains/losses), net exchange gains/losses, impairment loss on interest in an associate, provisions for expected credit loss, capitalized interest charged to cost of sales, income tax expense, depreciation, amortization of intangible assets, amortization of land use rights, share-based payments and write down of completed properties held for sale and provisions for properties under development, write off of intangible assets (2) EBITDA Margin = EBITDA / Revenue (3) Core Net Profit = Net profit excluding net gain on repurchase of senior notes, net fair value gain on financial assets aft FVTPL, fair value gain on investment properties, net of deferred tax and net exchange gains/ losses (4) Interest Coverage Ratio = EBITDA / Interest Expense (5) Debt/EBITDA = (Short-term Borrowings + Long-term Borrowings) / EBITDA (6) Quick Ratio = (Restricted Cash + Short-term Bank Deposits + Cash and Cash Equivalents) / Short-term Borrowing
26 Prudent Financial Policies
Debt Structure Debt Maturity Profile
Within one year Offshore Senior Notes Onshore Bank 16% 37% Borrowings 40% Over five years 22% Total borrowings: RMB109.0 bn Onshore: 62% One to two Offshore: 38% years Offshore Bank Onshore non- Two to five 32% Borrowings Bank 1% years Borrowings 30% 22% Net Gearing Weighted Average Cost of Borrowing
9.00% 350% 308% 8.42% 300% 8.50% 8.30% 300% 8.00% 8.00% 236% 250% 7.50% 200% 7.00% 150% 6.50%
100% 6.00%
50% 5.50%
0% 5.00% 2016 2017 2018 2016 2017 2018
27 Debt Structure and Maturity Profile
Debt Maturity Profile (As of 31 December 2018)
50% 44.1% 45% 40% 35% 31.7% 30.4% 30% 25% 22.3% 19.9% 19.9% 20% 15.6% 16.1% 15% 10% 5% 0% Within 1 year Between 1-2 years Between 2-5 years Over 5 years FY 2017 FY 2018
(RMB bn) < 1 year 1 - 2 years 2 - 5 years > 5 years Total Funding Cost
Onshore 13.6 27.9 21.9 3.8 67.2 8.13%
Offshore 3.4 6.6 11.1 20.5 41.6 8.88%
Total 17.0 34.5 33.0 24.4 108.8 8.42%
28
2018 Earnings
(RMB bn) 2018 2017 % Change
Revenue 38.7 32.8 +18% -Sales of properties 36.1 31.2 +16% -Rental income 0.3 0.2 +50% -Property management services 0.5 0.3 +67% -Hotel and catering operations 0.2 0.2 - -Cinema, department store and cultural center operations 0.5 0.2 +150% -Water-way passenger and cargo transportation 0.8 0.6 +33% -Others 0.3 0.1 +200% Cost of sales 27.6 23.8 +16% Gross profit 11.1 8.9 +25% Gross profit margin 29% 27% +2ppts Net profit 3.3 3.0 10% Net profit margin 9% 9% - Core net profit(1) 4.7 1.2 304% Core net profit margin 12% 4% +8ppts
(1) Core Net Profit = Net profit excluding net gain on repurchase of senior notes, net fair value gain on financial assets at FVTPL, fair value gain on investment properties, net of deferred tax and net exchange gains/ losses
31 Balance Sheet
(RMB bn) As at 31 Dec 2018 As at 31 Dec 2017 % Change
Total assets 229.0 213.4 +7%
Total liabilities 192.7 183.4 +5%
Net current asset 66.7 70.0 -5%
Total equity 36.3 30.0 +21%
Cash and bank deposits 22.9 21.2 +8%
Quick ratio(1) 1.3X 1.0X -
Leverage ratio(2) 38% 42% -4ppts
Net gearing ratio(3) 236% 300% -64ppts
(1) Quick ratio equals to cash and bank balances, short-term bank deposits and restricted cash over short-term borrowings (2) Leverage ratio equals to net debt (total borrowings net of cash and bank balances, short-term bank deposits, long-term bank deposits and restricted cash ) over total assets (3) Net gearing ratio equals to net debt (total borrowings net of cash and bank balances, short-term bank deposits, long-term bank deposits and restricted cash ) over total equity
32 Land Acquisition in 2018
Attributable Attributable Time of Attributable Site Area GFA # Location GFA Consideration Type Acquisition Interest (sq. m.) (sq. m.) (sq. m.) (RMB mn) 1 May-18 Xuzhou, Jiangsu 50% 132,397 172,115 86,058 867 Residential 2 May-18 Shenzhen, Guangdong 100% 34,129 160,970 160,970 2,068 Commercial and Residential 3 May-18 Shaoxing, Zhejiang 36% 61,234 46,660 16,658 112 Residential 4 May-18 Bazhou, Hebei 51% 36,576 54,864 27,981 134 Residential 5 May-18 Gu’an, Hebei 49% 32,484 48,726 23,876 88 Residential 6 Jun-18 Ningbo, Zhejiang 30% 15,086 38,738 11,621 82 Commercial and Residential 7 Jun-18 Pengzhou, Sichuan 100% 104,964 278,191 278,191 268 Residential 8 Jun-18 Suzhou, Jiangsu 100% 31,666 37,999 37,999 214 Residential 9 Jun-18 Yangjiang, Guangdong 100% 39,063 60,553 60,553 169 Residential 10 Jun-18 Shanghai 75% 44,590 80,262 60,196 398 Social housing 11 Jun-18 Yangjiang, Guangdong 100% 39,389 98,472 98,472 252 Residential 12 Jun-18 Hengyang, Hunan 51% 50,054 160,674 81,944 225 Residential 13 Jun-18 Dalian, Liaoning 100% 41,150 105,914 105,914 232 Residential 14 Jun-18 Shenzhen, Guangdong 72% 5,992 50,556 36,400 316 Commercial and Residential 15 Jun-18 Chengdu, Sichuan 100% 3,286 26,290 26,290 183 Commercial and Residential 16 Jul-18 Changsha, Hunan 100% 14,324 221,603 221,603 1,000 Commercial 17 Jul-18 Ezhou, Hubei 35% 103,176 281,669 98,584 309 Residential 18 Aug-18 Chengdu, Sichuan 51% 34,088 68,175 34,769 443 Residential 19 Aug-18 Zhuhai, Guangdong 100% 21,969 73,816 73,816 686 Residential 20 Aug-18 Foshan, Guangdong 35% 13,828 55,313 19,360 67 Commercial 21 Aug-18 Xinxiang, Henan 100% 23,165 81,077 81,077 221 Residential 22 Aug-18 Zhongshan, Guangdong 100% 25,848 64,619 64,619 383 Residential 23 Aug-18 Zhongshan, Guangdong 100% 25,492 63,728 63,728 370 Residential 24 Aug-18 Huizhou, Guangdong 100% 22,201 71,043 71,043 230 Residential 25 Sep-18 Suizhong, Liaoning 100% 307,293 733,463 733,463 530 Residential 26 Sep-18 Chongqing 100% 77,522 226,927 226,927 330 Residential 27 Oct-18 Sanya, Hainan 60% 42,585 42,585 25,551 271 Commercial and services 28 Dec-18 Sanya, Hainan 100% 36,943 44,332 44,332 500 Residential 29 Dec-18 Changsha, Hunan 60% 50,161 283,789 170,273 596 Commercial 30 Dec-18 Guangzhou, Guangdong 55% 179,000 507,650 279,208 4,235 Residential Total 1,649,654 4,240,772 3,321,475 15,778
33 2019 Key Projects - Shenzhen
SHENZHEN KAISA GOLDEN BAY INTERNATIONAL PARK SHENZHEN PINGHU KAISA PLAZA
Xiasha Community, Dapeng Street, Dapeng • Located at Junction of Shouzhen Street and Location • New Town Pinghu Avenue, Pinghu Street, central Location district of Pinghu in Longgang District, Site Area (sq. m.) • 870,000 Shenzhen; adjacent to the Shenzhen Metro Line 10 which is under planning GFA (sq. m.) • 520,000 Site Area (sq. m.) • 170,000
• The project is for comprehensive use and GFA (sq. m.) • 480,000 expected to be developed as a coastal eco- tourism resort comprising commercial streets, • Urban redevelopment Project Highlights tourism and cultural attractions, hotel and Highlights • Shenzhen Pinghu Kaisa Plaza is expected to business apartments. This project is divided comprise residential, commercial and office into four phases. buildings as well as serviced apartments.
34 2019 Key Projects - Shenzhen
SHENZHEN KAISA YANTIAN CITY PLAZA SHENZHEN KAISA FUTURE CITY
Located at the hinterland of Yantian Port, • Located at Junction of Ruyi Road and Dayun Location • Yantian District, Shenzhen Road, Longcheng Street, Longgang District, Location Shenzhen; adjacent to the Shenzhen Site Area (sq. m.) • 170,000 Universiade Sports Centre and Longcheng Park in Longgang District 1,070,000 (of which 130,000 sq.m. are used GFA (sq. m.) • for commercial purpose) Site Area (sq. m.) • 49,000 GFA (sq. m.) • 280,000 • Urban redevelopment Project • The project is planned to be the largest • Urban redevelopment Project Highlights urban complex in the region and is • Expected to comprise residential, comprised of residential, commercial, Highlights commercial and office buildings as well as apartment and office buildings. The project is serviced apartments. The project is divided divided into three phases. into two phases.
35 Metro-accessible Projects in Shenzhen
Has 8 metro-accessible projects in Shenzhen, occupying prime locations Strategic project location reserves great potential for value appreciation
Mid to long term planning of railway transit in Shenzhen
Niuhu Pinghu (expected to (expected to pen in June open in Pinghu Kaisa Kaisa E Cude 2020) &Pinghu Railway 2020) Plaza (For Sale) Station (For Sale) Changzhen (expected to open in2020) & Guangmingcheng High Speed Rail Station Dayun (existing) & Xuexiang & Gangtou Nam Tai Inno (existing) Longcheng Park (expected to open in Kaisa Future City Park (Under (expected to open in June 2020) Construction) 2022) (For Sale)
Yantian Road Bantian Kaisa (expected to open Yantian Kaisa in May 2020) City Plaza City Plaza (For Sale) (For Sale) Shaibu
Kaisa Financial Dongmendao Center Science Project (Under Museum (Under Construction) Construction)
36 Abundant Premium Projects in Shenzhen
Projects in land bank (19) (no. of projects)
Major URPsTransportation in pipeline Link (81) in Shenzhen
Inno Park Major transportation hubs in Shenzhen 云创谷
Kaisa E Cube 光明区 佳兆业E立方 Guangming 龙岗区 District 龙华区 Longgang District Longhua District Pinghu Kaisa Plaza 平湖佳兆业广场 Kaisa Future City 佳兆业未来城 Bailingda Project 坪山区 百灵达项目 Shangxue Project Pinghu Pingshan District 宝安机场 宝安区 上雪项目 平湖 Bao’an Airport Bao’an District 坂田 Henggang Bantian Kaisa City Plaza 大鹏新区 Bantian 横岗 Yantian Kaisa City Plaza Inno City 坂田佳兆业城市广场 盐田佳兆业城市广场 Dapeng New District 云创城 Luohu Dongmen Project 盐田区 North Station 罗湖东门项目 Yantian 深圳北站 Nanmendun Project Kaisa Golden Bay International District Park Kaisa Financial Center 南门墩项目 南山区 罗湖区 佳兆业金沙湾国际乐园 佳兆业金融中心 Nanshan Luohu District District 盐田港 Yantian Port Futian Dongshan Project 福田区 福田东山项目 沙头角口岸 Futian District 罗湖口岸 Shatoujiao 前海 Futian Border Project Luohu Checkpoint Checkpoint Qianhai 福田口岸项目 皇岗口岸 福田口岸 Huanggang 深圳湾 Futian Checkpoint Shenzhen Bay Checkpoint Checkpoint Nan’ao Project 香港 南澳项目 蛇口港 Hong Kong Shekou Port
Land Bank – GFA URP Pipeline Site Area¹ As of FY2018 (‘000 sq. m.) (‘000 sq. m.) Shenzhen 3,158 9,542
¹not in land bank; plot ratio is not yet calculated
37 Track Record of URPs Conversion
In the past 10 years (2008-2018), converted GFA of approximately 940,000 sq. m. every year Successfully converted over 11 million sq. m. urban renewal projects since established GFA No of projects Year Projects Locations Type converted converted (‘000 sq. m.) 1999 Shenzhen Woodland Height Longgang, Shenzhen Residential 580 1 2001 Shenzhen Mocha Town Longgang, Shenzhen Residential 735 1 2004 Shenzhen Kaisa Center Futian, Shenzhen Residential 98 1 2005 Guangzhou Kaisa Plaza Tianhe, Guangzhou Commercial 233 1 2006 Shenzhen Jincui Garden Luohu, Shenzhen Residential 106 1 Zhuhai Lake view Waldorf Garden (phase 1-2) Xiangzhou, Zhuhai Residential 2007 655 2 Shenzhen Kaisa Financial Center Futian, Shenzhen Commercial 2008 Huizhou Kaisa Riverbank New Town Boluo county, Huizhou Residential 4,326 1 Shenzhen Metro City Longgang, Shenzhen Residential 2010 1,209 2 Shenzhen Kaisa City Plaza Longgang, Shenzhen Residential 2011 Dongguan Le Grand Bleu Shatian town, Dongguan Residential 717 1 2012 Shenzhen Marriott Hotel Golden Bay Dapeng, Shenzhen Commerical 78 1 2013 Shemzhen Dapeng Kaisa Peninsula Resort Dapeng, Shenzhen Commercial 186 1 2014 Shenzhen Yantian Kaisa City Plaza Yantian, Shenzhen Residential 694 1 Dongguan Riverside Woods Palace Fenggang town, Dongguan Residential 2015 358 2 Dongguan Riverside Hillview Palace Fenggang town, Dongguan Residential Shenzhen Pinghu Kaisa Plaza Longgang, Shenzhen Residential 2016 754 2 Shenzhen Kaisa Future City Longgang, Shenzhen Residential Shenzhen Inno Park Guangming, Shenzhen Industrial 2017 538 2 Shenzhen Inno City Bao'an, Shenzhen Industrial Guangzhou Xiaoping Village Baiyun, Guangzhou Residential 2018 Shenzhen Dongmen Project Luohu, Shenzhen Commercial & Residential 595 3 Zhuhai Lake View Waldorf Garden (phase 3) Xiangzhou, Zhuhai Residential 11,862 23
38 Shareholding Structure
Founder and chairman 20 years of industry experience Responsible for overall strategy, investment planning and human resources strategy
Funde Sino Life Kwok Family Other public investors Insurance Co., Ltd.
25.33% 39.44% 35.23%
Hotel and catering Sales of properties Rental income Property management Others operations
Generate revenue from Management and Provide property Operation of five-star Cultural & leisure, sale of residential operation of management services hotels, boutique shipping business, properties, villas, commercial properties Accounting for 1.3% of business hotel chains, health care and service apartments, to generate income revenue as end of and serviced technology to bring commercial and Accounting for 1.0% of FY2018 apartments synergy for future integrated commercial revenue as end of Accounting for 0.6% of property development buildings etc, FY2018 revenue as end of Accounting for 3.9% of Accounting for 93.2% FY2018 revenue as end of of revenue as end of FY2018 FY2018
Property Related Businesses Contribute 96.1% of Total Revenue
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