China SCE profit up 110% to HK$701mln

Developer sees better growth as PRC economy rapidly develops and pace of urbanisation continues to accelerate.

China SCE Property Holdings Limited (“China SCE” or the ”Group”) (stock code:1966), a Mainland developer of high-end residential properties, has announced its interim results for the 6 months ended 30 June 2010 (“the period under review”).

During the period under review, the Group’s revenue and core profit attributable to shareholders were approximately RMB2.09 billion and RMB607 million respectively, increasing 308% and 386% compared to the same period last year. Gross profit margin reached 48%. Basic earnings per share were RMB22.4 fen. The Board declared the payment of an interim dividend of HK$4 cents per share, according to a China SCE report.

During the period under review, the Group had 4 projects in pre-sale stage, 2 of which were rolled out for sale during the period. Sunshine Town (Phase 1) and Fortune Plaza (Phase 1) Yujingwan, both located in Quanzhou, introduced for sale with almost all units sold on the first day of sales. For the six months ended 30 June 2010, the Group sold 193,379 sq.m. of contract sales area, representing a growth of 118% over the same period last year; and recorded RMB1.23 billion of contract sales income, representing a growth of 51% over the same period last year. As at 30 June 2010, contract sales amount and contract sales area that had been contracted but not yet recognised as sales income were RMB2.40 billion and 356,000 sq.m., respectively.

For projects under development, the Group had 8 projects at different stages of development with a total GFA of approximately 1.19 million sq.m.. In respect of land bank, as at 30 June 2010, the Group, together with its jointly-controlled entities and associates, owned a land bank with planned GFA of approximately 8.57 million sq.m. (6.17 million sq.m. was interest attributable to the Group). The total planned GFA of the newly acquired land during the period under review is approximately 2.15 million sq.m., of which 1.85 million sq.m. of land was acquired in Bohai Rim Economic Zone, therefore laying a solid foundation for the Group’s future expansion in this region.

The chairman of China SCE, Mr. Wong Chiu Yeung, concluded, “For the first half of 2010, despite the impact of the macro-economic control policies targeting the PRC real estate market, we are encouraged by achieving satisfactory results through our prudent and sound business strategies. We strongly believe that these macro-economic control policies were implemented by the central government to guide the real estate industry towards a stable and healthy development. As the PRC economy rapidly develops and the pace of urbanisation continues to accelerate, there should be a great demand for housing in the PRC in the coming 10 to 20 years, therefore the development outlook of the real estate market is still optimistic. Looking ahead, we plan to continue implementing our nationwide development strategy with focus on the Western Taiwan Strait Economic Zone, the Bohai Rim Economic Zone and the Pearl River Delta Economic Zone, in order to maximize the returns for the shareholders.”