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China Overseas Land & Investment Ltd. Announces 2022 Interim Results Author:China Overseas Land and Investment Ltd.

Robust Foundation, Forging Ahead
Sales performed well against market headwinds, industry ranking rose to Top 4
Actively seeking acquisition to capture market opportunities

(Hong Kong, 24 August 2022) China Overseas Land & Investment Ltd. (“COLI” or the “Group”, stock code: 0688.HK) announced its 2022 interim results today.

Facing adverse industry environment, the Group expanded its comparative advantages, and steadily grew its market share, continuously creating sustainable return to shareholders. The Group Series of Companies achieved contracted property sales of RMB138.50 billion in the first half of 2022, and the sales ranking rose to Top 4 in the industry. The Group’s revenue was RMB103.79 billion. Profit attributable to equity shareholders of the Company amounted to RMB16.74 billion. Net profit margin attributable to shareholders was 16.1%, maintaining a leading position in the industry. After deducting net gains after tax arising from changes in fair value of investment properties and net foreign exchange gains and losses, profit attributable to equity shareholders of the Company was RMB17.35 billion. In respect of the six months ended 30 June 2022, the equity attributable to the shareholders of the Company was RMB352.81 billion. Net assets per share was RMB32.2. The Group’s half-year return on equity was 4.8%. Basic earnings per share was RMB1.53, with a proposed interim dividend of HK40 cents per share.

Financial stability with ample cash on hand, average borrowing costs remaining at the lowest range in the industry. The Group is committed to the principle of prudent financial strategy, complies with all “three red lines”, remained as a quality “green category” developer, and all metrics stayed at an excellent level. At 30 June 2022, the Group’s liability to asset ratio was 59.0%, and net gearing was 41.0%. Cash on hand was RMB125.32 billion. Weighted average borrowing costs were 3.44% during the period, among the lowest range in the industry. The three major international credit rating agencies assigned the highest credit ratings among mainland property developers, to COLI, including A- by Fitch, Baa1 by Moody’s and BBB+ by S&P. Under the current market condition, the Group maintained its financial strength and is well positioned to capture “cream of the crop” opportunities.

Strategically focusing on major cities, maintaining high-quality operations. The Group’s market share in major cities continued to rise with contracted sales from the first-tier cities Beijing-Shanghai-Guangzhou-Shenzhen and Hong Kong, accounting for 36.8%, up10.1pp. During the period, the Group Series of Companies ranked top three in 29 cities in terms of market share. Contracted sales in Beijing, Tianjin, Hong Kong and Guangzhou exceeded RMB10 billion respectively, of which, contracted sales in Hong Kong recorded a historical high of more than HK$13.0 billion.

Proactive land acquisition, adopting “blue ocean strategy”. In the first half of 2022, with overall land market transactions declining significantly, the Group maintained its investment scale. The Group Series of Companies acquired 27 land parcels with a total land premium of RMB53.11 billion and corresponding saleable resources of RMB108.19 billion. The Group adhered to the “blue ocean strategy”, and acquired two high-quality projects in Qingdao West Coast New Area with innovative investment model. Seizing the opportunity of realignment in the industry, the Group is actively seeking acquisition opportunities. In the first half of 2022, the Group focused on selecting the highest-quality assets in higher-tier cities and acquired equity interests in several projects in Guangzhou, Shanghai, Chengdu and other cities, with a total investment of RMB10.66 billion. As of 30 June 2022, the total land reserve of the Group Series of Companies reached 74.39 million sq m, empowering the Group’s sustainable development.

Prominent strengths in high-quality delivery. In the first half of 2022, the Group overcame the impact of COVID-19 and achieved 100% on-time delivery completion rate, with early delivery accounting for about 33%. Customer satisfaction remained top 3 among the top 20 developers.

The Group’s owned commercial assets achieved rapid growth. In the first half of 2022, the Group put increasing numbers of commercial projects into operations, and rental income achieved growth against market headwinds. The Group’s revenue from commercial properties was RMB2.65 billion, an increase of 6.2% as compared to the corresponding period last year. During the period, 7 new commercial properties held by the Group in operation were added, including Beijing Jin’an Uni ELITE, Guangzhou Asian Games City Plaza, and Unilive Apartment (Chengdu Tianfu International) with an additional GFA of 380,000 sq m. In the second half of 2022, another 10 commercial projects held by the Group Series of Companies are scheduled to launch with an estimated additional GFA of 710,000 sq m. The Group’s both office and shopping mall businesses maintained on growth trajectory.

The sales of the Group Series of Companies in Hong Kong hit a record high. In the first half of 2022, the contracted sales of the Group Series of Companies amounted to HK$13.0 billion in Hong Kong. This year marks the 25th anniversary of Hong Kong’s reunification with Mainland China. The Group is confident of a brighter future for Hong Kong and will continue to increase its investment in Hong Kong.

The Group continues to fulfill corporate social responsibility and progress along the path of green development. As of 30 June 2022, the Group has obtained 513 certifications in total, including National Green Building Star Certifications, US LEED Certification, US BOMA Certification, US WELL Certification and UK BREEAM Certification. And its green GFA with certification reached 93.03 million sq m, of which, Beijing China Overseas Fortune Center has obtained WELL V2 CORE platinum certification, and the main tower of Tianjin City Plaza Phase IV has obtained LEED gold pre-certification.

During the period, the Group continued to facilitate rural revitalisation in three counties in Gansu Province, with a focus on Zhuoni County, assisting in the selection of native agricultural product and creating a new product focusing on highland barley under the brand ‘Vale of Clouds’ by cooperating with the local government.

The Group’s various ESG initiatives have also been recognized by the market, and was admitted into Hang Seng Climate Change 1.5°C Target Index newly launched by Hang Seng Indexes Company Limited in May this year. The Group also continued to be admitted into index constituents of the Hang Seng Corporate Sustainability Index, the Hang Seng ESG 50 Index and HSI Low Carbon Index. The latest rating by Sustainalytics remained “low risk”.

This year marks the 30th anniversary of the listing of the Group. With the strategy of stable operations and long-term development, the Group has achieved steady growth through multiple economic and real estate cycles with its market capitalization increased by nearly 80 times, maintaining its leading position in the industry. Looking ahead, the Group is cautiously optimistic that the real estate market will bottom out and rebound, and will strive to seize opportunities in an improving market to achieve better operating results. The Group is committed to being “a Company of Four Excellences” through “Good Products, Good Services, Good Effectiveness, Good Citizen” and focusing on the long term to grow steadily.

_688_Management group photo

From left to right: Mr. ZHANG Zhichao, CEO; Mr. YAN Jianguo, Chairman, Mr. LUO Liang, Vice Chairman, Executive Vice President, Chief Operating Officer and Chief Architect; and Mr. GUO Guanghui, Vice President

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