Yuexiu Property Company Limited: history, ownership, mission, how it works & makes money

A Brief History of Yuexiu Property Company Limited

Yuexiu Property Company Limited, established in 1992, has developed into one of China's leading property development companies, primarily focusing on residential and commercial projects. Listed on the Hong Kong Stock Exchange (stock code: 0123.HK), the company has expanded its portfolio across key regions in China, especially in Guangdong province.

As of December 2022, Yuexiu Property reported a total revenue of approximately RMB 26.3 billion, showcasing a significant year-on-year increase. The company's net profit attributable to shareholders for the same period was around RMB 2.1 billion, translating into earnings per share (EPS) of RMB 0.67.

Over the years, Yuexiu Property has diversified its operations, which include property investment, development, and management. By the end of 2022, the company's total assets were valued at approximately RMB 169.2 billion, with cash and bank deposits amounting to around RMB 35.8 billion.

By 2023, Yuexiu Property had completed over 30 million square meters of residential and commercial developments. The company emphasizes sustainability and has adopted various green building standards across its projects, aiming for advanced certifications like LEED and China’s Three-Star Green Building label.

The company’s geographical focus extends not only in major cities of Guangdong such as Guangzhou and Shenzhen but also to emerging markets in the Yangtze River Delta and the Bohai Economic Rim. In 2022, Yuexiu Property acquired several land parcels, investing a total of approximately RMB 20.5 billion in land use rights.

For financing, Yuexiu Property employs a mix of bank loans, bonds, and equity financing. As of the latest report, the company has a debt-to-equity ratio of approximately 70%, which reflects its strategy of leveraging debt for growth while maintaining a manageable financial risk profile.

In terms of market performance, Yuexiu Property's stock price as of October 2023 was approximately HKD 5.80, displaying resilience amidst market fluctuations. The company’s market capitalization stood at about HKD 27.5 billion.

Yuexiu Property's development pipeline remains robust, with approximately 15 projects currently under construction, forecasted to yield around RMB 35 billion in future sales upon completion.

A Who Owns Yuexiu Property Company Limited

Yuexiu Property Company Limited, a prominent property developer based in Hong Kong, is publicly traded on the Hong Kong Stock Exchange under the stock code 00123. As of October 2023, the company has a substantial market capitalization of approximately HKD 29.47 billion.

The ownership structure of Yuexiu Property primarily involves institutional investors and its parent company, Yuexiu Group. Below is a detailed breakdown of the major shareholders as reported in the latest filings:

In terms of recent financial performance, Yuexiu Property Company reported its earnings for the first half of 2023, showing a revenue of HKD 10.55 billion, which reflects a year-on-year increase of 18%. The company achieved a profit attributable to shareholders of HKD 2.23 billion, representing an increase of 25% compared to the same period in 2022.

The company’s debt-to-equity ratio stands at 97.8% as of the most recent financial reports, signalling a cautious approach towards leveraging in the current market. Additionally, Yuexiu Property has a robust cash position, with cash and cash equivalents amounting to HKD 7.12 billion.

Yuexiu Property’s strategic direction is heavily influenced by the parent company, Yuexiu Group, which holds a commanding stake and plays a pivotal role in decision-making processes. This relationship is further reinforced by their shared vision of expanding within the Greater Bay Area, aiming to capture growth in both residential and commercial sectors.

As of October 2023, the share price of Yuexiu Property is approximately HKD 5.10, showing a year-to-date increase of 30%. The stock has displayed a strong trading volume, indicating healthy investor interest and market confidence.

Overall, Yuexiu Property is positioned strongly within the Hong Kong real estate market, backed by its solid ownership by Yuexiu Group and a diverse shareholder base that includes significant institutional investors. The company's performance metrics and strategic initiatives suggest a stable trajectory in an evolving economic landscape.

Yuexiu Property Company Limited Mission Statement

Yuexiu Property Company Limited is a prominent real estate investment and development company based in Hong Kong. The mission statement of Yuexiu Property emphasizes its commitment to developing high-quality residential and commercial properties while contributing to the sustainable development of urban environments.

The company aims to provide superior quality and innovative property solutions that enhance the living environment. Yuexiu Property is focused on establishing long-term relationships with its customers and stakeholders through transparent and ethical business practices.

As of the end of 2022, Yuexiu Property managed a diversified property portfolio comprising approximately 8.29 million square meters of gross floor area. The portfolio consists of residential developments, office buildings, and commercial properties, primarily located in tier-one and tier-two cities in China.

Recent financial performance indicates that for the fiscal year 2022, Yuexiu Property recorded a total revenue of HKD 22.54 billion, marking a year-on-year increase of 12%. Net profit attributable to shareholders reached HKD 3.21 billion, up from HKD 2.87 billion in 2021.

The company is also committed to sustainability and social responsibility, aiming to reduce its carbon footprint and enhancing community engagement. As part of its mission, Yuexiu Property actively involves in green building practices, with over 70% of its new projects seeking green building certifications.

In terms of market presence, Yuexiu Property has successfully positioned itself in the competitive landscape of the real estate sector in China. The company's stock is traded on the Hong Kong Stock Exchange under the ticker symbol 0123.HK. As of October 2023, the share price is approximately HKD 6.80, reflecting a market capitalization of around HKD 34 billion.

The company’s financial health is supported by a debt-to-equity ratio of 0.56, which is considered low in the real estate sector, indicating a strong balance sheet and lower financial risk. Yuexiu Property's ability to generate cash flow is also demonstrated by its operating cash flow of HKD 5.67 billion for 2022, enabling further investment into property development.

How Yuexiu Property Company Limited Works

Yuexiu Property Company Limited is a leading property developer based in China, primarily focusing on the development and management of residential, commercial, and industrial properties. As of the first half of 2023, the company reported a total revenue of approximately RMB 16.52 billion, reflecting a year-on-year increase of 8.1%.

In terms of land bank, Yuexiu holds approximately 16.6 million square meters of land across major cities in China, with a significant portion concentrated in Guangdong province. The company’s strategic approach includes both property development and investment, allowing it to diversify income streams effectively.

Yuexiu Property's business operations can be segmented into three main categories:

• Residential Property Development
• Commercial Property Development
• Property Management Services

For residential property development, the company completed over 10,000 units in 2022, contributing significantly to their overall sales volume. The average selling price of residential properties in major cities like Guangzhou and Shenzhen has seen a slight increase of 3.5% year-on-year.

The commercial sector accounted for approximately 27% of the total revenue in 2022. Yuexiu Property operates various commercial properties, including office buildings and shopping malls, with an average occupancy rate of 91% across its portfolio.

Yuexiu Property has also been focusing on sustainability in its developments. The company aims for 30% of its new projects to meet green building standards by 2025.

In terms of financial performance, the company reported an operating profit of RMB 4.2 billion in 2022, with a net profit margin of 25%. The total assets of Yuexiu Property reached RMB 168.5 billion, and the equity attributable to shareholders was approximately RMB 52 billion.

The following table outlines the financial highlights of Yuexiu Property Company Limited for the past two years:

Yuexiu Property’s financing strategy includes a mixture of bank loans, bonds, and equity financing. In 2022, the company successfully raised RMB 5 billion through bond issuance, aimed at supporting its development projects and refinancing existing debts.

The management has emphasized maintaining a healthy debt-to-equity ratio, which currently stands at 1.3, demonstrating prudent financial management in a volatile market. Furthermore, the company has established a credit rating of A from major rating agencies, reflecting its strong financial position.

Yuexiu continues to leverage technology in its operations. The adoption of digital tools and smart construction techniques has improved project efficiency and cost management, resulting in an estimated reduction of construction costs by 15% over the past three years.

Overall, Yuexiu Property Company Limited operates in a highly competitive market, yet its diversified portfolio, focus on sustainability, and commitment to financial prudence position it well for future growth within the real estate sector in China.

How Yuexiu Property Company Limited Makes Money

Yuexiu Property Company Limited is a leading property developer in China with a diverse portfolio. The company's revenue streams primarily come from property development, investment, and management. In 2022, Yuexiu Property recorded total revenue of approximately RMB 75.42 billion, reflecting a year-on-year increase of 2.6%.

Revenue Breakdown

The revenue is divided among various segments:

• Property Development: This segment constitutes the majority of revenue, accounting for around 88% of total revenue.
• Property Investment: Contributes approximately 10% to total revenue, with properties leased out generating stable cash flow.
• Property Management: Makes up about 2% of revenue, providing additional services for residential and commercial properties.

In terms of sales, Yuexiu Property achieved total sales of RMB 86.27 billion in 2022, with total sold area amounting to approximately 5.82 million square meters.

Key Financial Metrics

Below is a detailed look at Yuexiu Property's key financial metrics:

Property Development

Yuexiu Property’s primary revenue comes from the sale of residential and commercial properties. The company mainly operates in Guangzhou, with a pipeline of around 2.5 million square meters of properties under development. In 2022, the average selling price of residential properties in its projects rose by 3.5% to approximately RMB 18,700 per square meter.

Investment Properties

The investment properties segment includes commercial and office spaces, generating stable rental income. In 2022, rental income totaled approximately RMB 7.45 billion, with a year-over-year growth of 4.2%.

Key investment properties include:

• Yuexiu Financial Tower
• Yuexiu Plaza
• Yuexiu World Trade Center

Property Management Services

Yuexiu Property also provides property management services, which add value through best practice operations and maintenance. In 2022, the property management segment generated revenue of approximately RMB 1.5 billion.

With more than 150 projects under management, the company capitalizes on economies of scale to provide efficient services, catering to over 200,000 residential units.

Strategic Initiatives

To expand its revenue base, Yuexiu Property is focusing on strategic initiatives such as:

• Enhancing its presence in second and third-tier cities.
• Investing in sustainable development projects.
• Exploring joint ventures for larger project developments.

In summary, Yuexiu Property Company Limited generates revenue through a combination of property sales, rental income, and management services, supported by strategic initiatives aimed at sustainable growth and market expansion.