保利物業服務股份有限公司 POLY PROPERTY SERVICES CO., LTD. (A joint stock company incorporated in the People’s Republic of China with limited liability) Stock Code: 06049. HK ANNUAL REPORT 3 Company Overview CONTENTS 4 Corporate Information 6 Financial Summary 8 Major Events in 2020 10 Awards and Honours 12 Chairman’s Statement 16 Management Discussion and Analysis 35 Directors, Supervisors and Senior Management 43 Corporate Governance Report 57 Report of the Board of Directors 81 Report of the Supervisory Committee 84 Independent Auditor’s Report 90 Consolidated Statements of Profit or Loss and Other Comprehensive Income 91 Consolidated Statements of Financial Position 93 Consolidated Statements of Changes in Equity 95 Consolidated Statements of Cash Flows 96 Notes to the Consolidated Financial Statements 187 Five Year Financial Summary COMPANY OVERVIEW Poly Property Services Co., Ltd. (the “Company” or “Poly Property”, and together with its subsidiaries, the “Group” or “we”) is a leading comprehensive property management service provider in China with extensive property management scale and state- owned background, ranking the third among the listed property management companies according to the List of Top Ten Listed Property Management Companies in 2020 released by the China Property Management Institute (“CPMI”). With high-quality services and brand strength, we have enjoyed an industry-wide reputation. Our brand was valued at more than RMB12.2 billion in 2020. The Group’s three main business lines, namely, property management services, value-added services to non-property owners, and community value-added services, form a comprehensive service offering to its customers along the value chain of property management. As of 31 December 2020, the Group has entered 184 cities in 29 provinces, autonomous regions and municipalities across the country, and recorded a gross floor area (“GFA”) under management of approximately 380.1 million sq.m. with 1,389 projects under management, and a contracted GFA of approximately 567.2 million sq.m. with 1,948 contracted projects. The Group continuously pushes forward the “Comprehensive Property” strategy and its business portfolio covers residential communities, commercial and office buildings and public and other properties. 黑龍江 Heilongjiang 吉林 Jilin 新疆 Xinjiang 北京 Beijing 遼寧 Liaoning 甘肅 Gansu 內蒙古 Inner Mongolia 天津 Tianjin 河北 Hebei 山西 Shanxi 青海 Qinghai 寧夏 Ningxia 山東 Shandong 河南 Henan 合同管理面積（百萬平方米） 陝西 Shaanxi 江蘇 Jiangsu Contracted GFA (Million sq.m.) 上海 Shanghai 西藏 Xizang 安徽 Anhui < 1 湖北 Hubei 四川 Sichuan 1 - 5 重慶 Chongqing 浙江 Zhejiang 5 - 10 Hunan 江西 Jiangxi 10 - 15 湖南 貴州 Guizhou ≧ 15 福建 Fujian 台灣 Taiwan 雲南 Yunnan 廣東 Guangdong 在管面積（百萬平方米） GFA Under Management 廣西 Guangxi (Million sq.m.) 香港 Hong Kong < 1 澳門 Macau 1 - 5 5 - 10 海南 Hainan 10 - 15 南海諸島 ≧ 15 Islands of South China Sea Poly Property Services Co., Ltd. 3 Annual Report 2020 CORPORATE INFORMATION BOARD OF DIRECTORS SUPERVISORY COMMITTEE Non-executive Directors Ms. Liu Huiyan (Chairlady) Ms. Zhong Yu Mr. Huang Hai (Chairman) Ms. Mu Jing (appointed on 27 August 2020) Mr. Liu Ping (appointed on 9 October 2020) Ms. Chen Shuping (resigned on 27 August 2020) Mr. Hu Zaixin JOINT COMPANY SECRETARIES Executive Directors Ms. Wu Lanyu (General Manager) Mr. Yin Chao (appointed on 21 February 2020) Mr. Li Jiahe (resigned on 27 August 2020) Ms. Yang Yang (resigned on 21 February 2020) Mr. Lau Kwok Yin Independent Non-executive Directors AUTHORISED REPRESENTATIVES Mr. Wang Xiaojun Ms. Tan Yan Ms. Wu Lanyu Mr. Wang Peng Mr. Lau Kwok Yin BOARD COMMITTEES AUDITOR Audit Committee BDO Limited Certified Public Accountants and Registered PIE Auditor Ms. Tan Yan (Chairlady) 25/F, Wing On Centre Mr. Liu Ping (appointed on 9 October 2020) 111 Connaught Road Central Mr. Hu Zaixin Hong Kong Mr. Wang Xiaojun Mr. Wang Peng LEGAL ADVISORS Mr. Huang Hai (resigned on 9 October 2020) Allen & Overy Remuneration Committee 9th Floor, Three Exchange Square Mr. Wang Xiaojun (Chairman) Central Ms. Tan Yan Hong Kong Mr. Wang Peng Mr. Hu Zaixin (resigned on 9 October 2020) Miao & Co (In association with Han Kun Law Offices) Mr. Li Jiahe (resigned on 27 August 2020) Rooms 3901-05, 39/F. Edinburgh Tower, The Landmark Nomination Committee 15 Queen’s Road Central Hong Kong Mr. Huang Hai (Chairman) Ms. Wu Lanyu COMPLIANCE ADVISER Mr. Wang Xiaojun Ms. Tan Yan GF Capital (Hong Kong) Limited Mr. Wang Peng 29–30/F, Li Po Chun Chambers 189 Des Voeux Road Central Hong Kong 4 Poly Property Services Co., Ltd. Annual Report 2020 PRINCIPAL BANKER China Construction Bank Poly Grand Mansion Branch Shop 102, No.3 Chen Yue Road Hai Zhu District, Guangzhou, Guangdong Province, The PRC REGISTERED OFFICE AND PRINCIPAL PLACE OF BUSINESS IN THE PRC Rooms 201-208 No. 688 Yue Jiang Zhong Road Hai Zhu District, Guangzhou, Guangdong Province The PRC PRINCIPAL PLACE OF BUSINESS IN HONG KONG 40/F, Dah Sing Financial Centre 248 Queen’s Road East Wanchai Hong Kong H SHARE REGISTRAR AND TRANSFER OFFICE Tricor Investor Services Limited Level 54, Hopewell Centre 183 Queen’s Road East Hong Kong INVESTOR RELATIONS Telephone: (86) 20 8989 9959 E-mail: [email protected] COMPANY WEBSITE www.polywuye.com STOCK CODE ON THE HONG KONG STOCK EXCHANGE 06049 Poly Property Services Co., Ltd. 5 Annual Report 2020 FINANCIAL SUMMARY SUMMARY OF THE CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME Year ended 31 December 2020 2019 Revenue (RMB million) 8,037.2 5,966.8 Gross profit (RMB million) 1,499.1 1,210.7 Gross profit margin 18.7% 20.3% Profit for the year (RMB million) 696.1 503.2 Net profit margin 8.7% 8.4% Profit for the year attributable to owners of the Company (RMB million) 673.5 490.5 Basic earnings per share (RMB)* 1.22 1.21 Return on shareholders’ equity (weighted average) 11.4% 51.8% * The H shares of the Company were listed on 19 December 2019. The over-allotment option was exercised in full on 10 January 2020, and the shares were issued on 17 January 2020. The weighted average number of ordinary shares for the year ended 31 December 2020 (the “year” or “period”) and for the year ended 31 December 2019 was 552,459,000 and 404,749,000, respectively. Details are set out in note 11 to the consolidated financial statements in this annual report. 6 Poly Property Services Co., Ltd. Annual Report 2020 SUMMARY OF THE CONSOLIDATED STATEMENTS OF FINANCIAL POSITION As at 31 December 2020 2019 Total assets (RMB million) 9,444.2 7,571.1 Cash and cash equivalents (RMB million) 7,448.1 6,508.6 Total equity (RMB million) 6,246.8 5,122.2 33.9% Gearing ratio 32.3% Poly Property Services Co., Ltd. 7 Annual Report 2020 MAJOR EVENTS IN 2020 On 7 August, Poly Property announced the full-value service system of “A Flourishing and Harmonious Ecosystem” at 2020 Guangzhou Smart Property Management Expo. On 5 April, in response to the national call of “Stabilising Employment”, Poly Property participated in the online recruitment of “National Recruitment Action” jointly organised by China Media Group, the SASAC and the MOHRSS, and announced our “Galaxy Talent Programme”, “Companion Programme”, “Heartwarming Employment Programme” and so on. On 18 June, the fourth Spark Class kick-started. 2020 marked the closing year of national precise poverty alleviation. Honouring the social responsibilities of a central enterprise, Poly Property made contributions towards precise poverty alleviation by providing “education+employment” to a total of 340 registered underprivileged students in national-level poverty-stricken counties. Since February, all of the employees of Poly Property were proactively devoted to the anti-epidemic works to safeguard thousands of projects across the country. With our performance being unanimously recognised by property owners, customers, the government and the society, we received weighty awards such as outstanding unit and outstanding individual in the fight against COVID-19 from the State-owned Assets Supervision and Administration Commission (“SASAC”) and Guangdong provincial government. 8 Poly Property Services Co., Ltd. Annual Report 2020 On 28 September, in view of the tenth anniversary of “Harmony Courtyard”, our residential property brand, Poly Property leveraged the Mid-Autumn Festival community IP activity of “A Myriad of Harmonious Lights” to introduce a new brand image for “Harmony Courtyard”. A community ambience centring on the symbol of “warmth” has been created. On 18 December, a corporate culture and concept system of Poly Property was officially introduced to announce the core values of “insisting on helping customers and employees to succeed, winning the market with quality and facilitating development through innovation and change”. On 27 October, Poly Property officially expanded its business into Xidong New City in Wuxi City and introduced an innovative urban management model to commence city-wide territorial management. On 11 December, Harmonious China Beautiful China – 2020 Social Governance and Collaborative Innovation China Mayor Forum was held in Wuxi City, Jiangsu Province, at which the new strategy of Poly Property was announced. Adhering to the position of “national power in the age of Comprehensive Property” and upholding the concept of “to serve the people by managing and achieving”, Poly Property has striven to become the prime provider of the Comprehensive Property ecosystem. Poly Property Services Co., Ltd. 9 Annual Report 2020 AWARDS AND HONOURS October Outstanding Unit in the Fight against September 2020 Top 500 Property Management 2020 COVID-19 as a Central Enterprise