SHENZHEN INVESTMENT LIMITED 
By Revenue up 17.6% to HK$9,778.8 million; Profit for the year attributable to owners of the parent up 27.0% to HK$2,738.4 million
Contracted sales increased by 47.1% to RMB 9 billion
Implemented the "Shenzhen focus" strategy and obtained quality land resources with a total
gross floor areas ("GFA") of 1.27 million sq.m.
Proposed final dividend at HK 12 cents per share, with an annual payout ratio of 32.2%
(31 March 2014 - Hong Kong) Shenzhen Investment Limited ("SZI" or the "Group", SEHK stock
code: 604.HK) is pleased to announce its annual results for the year ended 31 December 2013.
In 2013, under the background of relatively loosened monetary policies and strong end-user housing demand and improvement demand, the real estate market in China was picking up continuously, the real estate transactions were active with a strong recovery. The Group grasped the market opportunities, accelerated its property development and sales, implemented its strategic transformation and had achieved satisfactory operating results.
During the year, the Group achieved a turnover of HK$9,778.8 million from the continuing operations, up 17.6% year on year. Profit for the year attributable to the shareholders was HK$2,738.4 million, representing an increase of 27.0% over the same period of last year. Basic earnings per share remained stable at HK58.97 cents. The board of directors recommended a final dividend of HK 12 cents per share for 2013.
During the year, the Group recorded 538,565 sq.m. in property sales, representing an increase of 2.0% over the same period of last year and achieved a net revenue in property sales of RMB5,622.8 million (equivalent to HK$7,040.2 million) (net of business tax), representing an increase of 17.1% over the same period of last year. Gross profit margin of property sales was
40.9%, representing an increase of 1.7 percentage points over the same period of last year.
During the period, the Group achieved 729,469 sq.m. in contracted sales area and contracted sales of approximately RMB9,010 million, representing an increase of 47.1% over the same period of last year.
－Cont'd－
Shenzhen Investment Limited Announces 2013 Annual Results
31 March 2014/ Page 2
Breakthrough in acquiring quality land resources in Shenzhen
In 2013, through asset injection from its parent company, cooperation with other Shenzhen state-owned enterprises and impetus to urban redevelopment projects, the Group acquired four quality projects, increased its land reserve in Shenzhen by a GFA of over 1,270,000 sq.m., and effectively implemented the "Shenzhen focus" strategy and laid a firm foundation for sustainable
growth in future. The projects acquired in 2013 included UpperHills (深業上城) project, Tanglang
(塘朗) metro property development project, Guanlan Rose Garden (觀瀾玫瑰苑) project and
Chegongmiao (車公廟) redevelopment project Phase 1.
In January 2014, the Group proposed to acquire from its parent company a 100% stake in Shenzhen Nongke Holdings Company Limited (Nongke Group) for RMB5.623 billion. Nongke Group owns valuable lands and property assets in Shenzhen downtown. As at the announcement date, a total GFA attributable to Nongke Group is around 385,000 sq.m. (mainly including undeveloped land, investment properties and self owned properties). Nongke Group's
core asset, Mingren (名人) project, is located in Honey Lake, with a GFA of 259,300 sq.m. It is planned to be a complex project comprising of residential houses, apartments, offices and a
commercial hotel. This acquisition is subject to independent shareholder's approval.
As of 31 December 2013, the Group's cash balance (including pledged deposits and restricted cash) was HK$7,478.3 million. The net gearing ratio with the liabilities including bank loans and other borrowings only was 66.3%and the net gearing ratio with the liabilities including all the other liabilities carrying interest was 87.3%.
Future prospects
Mr. Lu Hua, Chairman of Shenzhen Investment said, "As for China, it will initiate various reform agendas in full swing for the year of 2014. The government will keep its macroeconomic policies stable, maintain steady growth and ensure that employment does not fall below the prescribed minimum level and that inflation does not rise above the projected level. As for the real estate market, we anticipate that the real estate market will more rely on the market-based measures, and the administrative control policies will gradually become weaker. Although the real estate market will face many uncertainties, we believe that in view of China's urbanization process and population structure, real estate is still a developing industry, and the markets in core cities are still improving steadily. We are confident in the sound long-term development of real estate industry.
Mr Lu continued, "The annual saleable property areas in 2014 are approximately 1.88 million sq.m. with saleable property value of approximately RMB25 billion of which Shenzhen accounts for half of the value. The annual sales target is about RMB10.5 billion, up 16.7% as compared with the actual contracted sales last year. The Group will strive to achieve the sales targets by tapping into the market opportunities and adopting flexible pricing. The Group will adhere to the consistent principle of maintaining healthy financial position, endeavour to reduce financing costs, and improve capital turnover efficiency to provide concrete protection of financial resources for its business development.
－Cont'd－
Shenzhen Investment Limited Announces 2013 Annual Results
31 March 2014/ Page 3
"Looking forward, the Group is very confident for the continuous growth of its performance in future. The Group will continue to implement its strategy of intensifying the development in Shenzhen, increase quality land reserves in Shenzhen, continuously optimize the structure of its land reserves, focus on both holding and development, improve cost control and operation standard, accelerate the asset turnover, improve the assets and liabilities and cash flow management. It is committed to maximize the value for our shareholders."
- End -
SZI listed on the Stock of Exchange in Hong Kong as a red chip since 1997, is a mid-to-high end property developer in Southern China. It is 60.59%-owned by Shenzhen's municipal government. As of 31 December 2013, the Group had a total gross land reserve of 11.59 million sq.m. (in GFA). The Group has property projects under construction of approximately 3.28 million sq.m. in terms of GFA.
For enquiry, please contact:
Nicole Zhou
Tel: (852) 2312 8746
Email: zhouq@shumyip.com.hk
Tina Law / Molisa Lau / Cherry Chen
Tel: (852) 2136 6181 / 2136 6953 / 3920
7651
Fax: (852) 3170 6606
Email: szi@iprogilvy.com
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