Top Spring Announces 2015 Interim Results

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Tuesday, 1 September 2015, 19:30 HKT/SGT

The Group's Revenue up 126.2% YoY, Strive to Diversified Development

HONG KONG, Sept 1, 2015 - (ACN Newswire) - Top Spring International Holdings Limited (the "Top Spring" or the "Company", and its subsidiaries the "Group"; Stock code: 03688), one of the real estate property developers in China, is pleased to announce the interim results of the Company for the year ended 30 June 2015 (the "Review Period").

During the first half of 2015, the Central Government of the PRC adopted a moderate loose monetary and regulatory policy to stimulate the real economy, which made the domestic real estate market to rebound and to achieve steady growth. Top Spring launched 11 projects across eight cities in the PRC, achieved contracted sales plus subscribed pre-sales of approximately HK$3,775.2 million from the sale of properties and car park units, representing an increase of approximately 2.5% as compared with the corresponding period in 2014. The Company also recorded a significant increase in its ASP of the total contracted sales of properties as compared with the corresponding period in 2014. The Top Spring's total revenue were approximately HK$2,058.5 million in the first half of year, increased by approximately 126.2%, as compared with the corresponding period of 2014.

The rental income from investment properties increased 8.7%
Due to the overall increased efficiency of leasing for the Group's operating investment property portfolio, the Group's rental income from investment properties steadily increased to approximately HK$167.8 million in the first half of 2015, representing an increase of approximately 8.7%. As at 30 June 2015, the Group's overall occupancy rate remained at a very high level, which was approximately 89.8%. As at 30 June 2015, the total leasable GFA in the Group's operating investment property portfolio slightly increased from approximately 262,711sq.m. as at 31 December 2014 to approximately 265,612sq.m. As at 30 June 2015, taking into account the projects that are completed but yet to operate or to be developed in the next one to three years, the future leasable GFA of the Group's investment property portfolio will reach approximately 463,062sq.m. and its fair value was approximately HK$9.5 billion, representing approximately 23.6% of the Group's total asset value.

The land bank is sufficient
In terms of land replenishment and project development strategy, the Group will focus on the first and second-tier cities in China with great potential for economic growth, such as Shenzhen, Shanghai and Nanjing and the core cities in Jiangxi Province such as Nanchang where the transportation network is effective and high speed rail, metro network and expressway are in operation or under construction. As at 30 June 2015, the land bank of the Group was approximately 5,403,405sq.m.

The Group continued to maintain a prudent land banking strategy to look for new projects or land acquisition opportunities. Since the Group expects its current land bank will be sufficient for its development and operation for the next eight to ten years, the Group only acquired a parcel of land, which will be demolished and reconstructed under the urban renewal project in Longgang, Shenzhen, through acquiring 60% equity interests in a project company in Shenzhen during the first half of 2015. The site area of the urban renewal project was approximately 88,764sq.m.

As at 30 June 2015, the Group had 25 projects across 12 cities with a total estimated net saleable/leasable GFA of approximately 5,403,405sq.m. Excluding Shanghai Shama Century Park (an operational serviced apartments project), Shenzhen Fashion Mark, Shenzhen Buji Market Project, Shenzhen Smart Venture Valley and Shenzhen Junan Project (all are redevelopment projects) and Middlewood Locks Property and The Hat Box (both are overseas projects), the remaining estimated land bank of the Group of approximately 3,512,326 sq.m. had an average land cost of approximately RMB2,692.2 per sq.m.

Improving the execution abilities, the Group for the first time issued a 3-year Renminbi denominated unlisted note amount of RMB990,000,000

In the first half of 2015, on top of achieving slight improvement in property contracted sales, rental income and consolidated financial results, the Group also put much effort in improving the execution abilities, product innovations, sales strategy and model. Together with the Group's information technology system that incorporates the new internet mindset, all these create better values for the Group's product innovations and contribute to the continued increase in customer satisfactory level.

In addition, leveraging on the Group's financial position and creditworthiness, the Group for the first time successfully issued a 3-year Renminbi denominated unlisted note in the principal amount of RMB990,000,000 at a coupon rate of 10.595% per annum, payable quarterly in arrears, up to the date of redemption of the Note. The successful issue of the Note signified the Group's flexibility in deploying funds and optimising the Group's corporate debt structure so as to convert the short-term debts into long-term debts. The issue of the note will also provide the Group with funding for its land acquisitions in the future.

Shareholder "YMCI enhanced the Company's value and return
The Topspring transferred 325,000,000 Shares (representing approximately 27.62% of the then issued capital of the Company) to Caiyun International Investment Limited, a wholly-owned subsidiary of Yunnan Metropolitan Construction Investment Group Co., Ltd.* ("YMCI Group") which is a State-owned enterprise. The transfer of shares by the controlling shareholder to YMCI Group would enable the Group to utilise the strengths and advantages of YMCI Group for the Group's future development on the health region and the overseas project.

After ten years of development, YMCI Group has total assets of over RMB100 billion and more than 20 subsidiaries. The principal business which YMCI Group engaged in include urban development, urban water supply, cultural and tourism, medical services, bio-pharmaceutical, financial, education, insurance and hotel business. YMCI Group is promoting the"2 + 2 + 2"development strategy (namely, strengthening two main businesse-core cities development and urban water supply; promoting two transformations- healthcare and leisure; and establishing two platforms- finance and Internet).

Looking forward, Mr. WONG Chun Hong, the executive director, chairman and chief executive officer stated, the Group's mandate will continue to be "strengthening existing businesses while developing new businesses". As for existing businesses, the Group aims to acquire few more high-quality projects in the core cities. Meanwhile, the Group intends to cooperate with other third parties to increase its land reserves and projects. As for developing new business areas, the Group will take advantage of the opportunities created by transformation of Chinese society and its economy, and the resulting market demands. An emphasis is placed on the healthcare business for exploring possible diversification directions.

About Top Spring International Holdings Limited
Top Spring is a Top 100 China Property Developer (HK enterprise) specializing in the development and operation of urban mixed-use communities and the development and sale of upscale residential properties in China. Currently, we have a total of 25 property projects at various stages of development in Shenzhen, Huizhou, Dongguan, Shanghai, Nanjing, Hangzhou, Changzhou, Nanchang, Chengdu, Beijing Yanjiao, Tianjin and Manchester (UK) with a net saleable/leasable GFA of approximately 5.4 million sqm. At the same time, the company has been proactively developing its 'Blue Ocean' business in medic-care, wellness, and food safety.

Topic: Press release summary Sectors: Daily Finance
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