Minmetals Land 2010 profit up 293% to HK$454mn

The company targets contracted sales of HK$7bn, up 82% and GFA of 640,000 square meters, up 103% from contracted sales achieved in 2010.

Minmetals Land Limited (“Minmetals Land”) announces the annual results of 2010. For the year ended 31 December 2010, the Company recorded consolidated revenue of HK$1,659 million, a 33% growth compared with HK$1,244 million in the preceding financial year. Profit for the year increased by HK$454 million from HK$155 million in 2009 to HK$ 609 million in 2010, representing a substantial increase of 293%. Thanks to the refined product mix of deliveries and improvement of overall cost control and operation efficiency, the gross margin largely increased by 15.3% to 37.8%. Better-than-expected pre-sale results were achieved as the Company’s projects in Nanjing and Changsha reached stage for large scale launching. The operating profit from real estate development grew by 375% year-on-year from HK$ 163 million to HK$ 774 million. Basic earnings per share for profit attributable to equity holders of the Company increased by 141% year-on-year from HK7.94 cents to HK19.14 cents. The Board proposed a final dividend of HK1 cent per share for the year ended 31 December 2010.

As at 31 December 2010, the Company’s net assets were up by 34% to HK$5.923 billion. During the year, approximately 600 million shares were issued for the acquisition of three prime real estate development projects from the parent company, China Minmetals Corporation (“China Minmetals”). Notwithstanding the share capital base has increased by 22% to 3.335 billion shares, net assets value per share grew by 9% year-on-year from HK$1.62 to HK$1.77. On the other hand, the Company’s land bank has largely increased by about 2 million square meters GFA in 2010. Having excluded 170,000 square meters GFA handed over to clients in 2010 and included the newly acquired land in Nanjing in January 2011, the Company’s current land has increased to 4.25 million square meters GFA. As at the end of 2010, total gearing ratio of the Company went up from 28% in 2009 to 65% in 2010, although the net debt ratio was only 11% after taking into account of cash on hand of HK$3.36 billion.

During the period, China Minmetals has speed up the development and restructuring of its real estate operations under the strong leadership of Mr. Sun Xiaomin, Chairman of Minmetals Land. At present, it has land bank of over 4.71 million square meters GFA. Simultaneously, the Company has gained further dimensions with an expanded real estate development portfolio in more localities in the PRC, a more established and efficient operating platform and further inroads in building recognition for the Minmetals Land’s brand name in the PRC’s property market. At present, the Company has ten residential and commercial projects under development in the PRC covering eight tier-1 and core tier-2 cities including Zhuhai, Huizhou, Nanjing, Changsha, Tianjin, Beijing, Yinkou and Xianghe. Thanks to the continuous support from the controlling shareholder, China Minmetals, and rapid development in the last three years, the Company has reached a stage of new development, according to a Minmetals Land report.

Mr. He Jianbo, Managing Director of Minmetals Land, said with great confidence, “The Company will continue to enhance the product quality while speed up its pace of development. The enhancement of project management and sales and marketing capabilities will firmly assure the continuing growth of profit margin of our projects. The Central Government will continue to implement policy to intervene the real estate industry this year. The Company is committed to a strategy for her steady expansion in 2011, including a planned construction and completion GFA amounted to 1.79 million square meters and 0.77 million square meters respectively. Target contracted sales is HK$7 billion and GFA of 640,000 square meters, representing an increase of 82% and 103% respectively from contracted sales achieved in 2010. About HK$2.6 billion contracted sales will be recognized as revenue in 2011. Up to 20 March, 2011, the Company recorded contracted sales of HK$1.4 billion and GFA of 121,000 square meters. As one of the 16 SOEs authorised by the SASAC to operate real estate development as core businesses, China Minmetals will continue to fully support the Company’s business development by injecting its quality real estate assets into the Company and transform the Company to be its sole listed real estate flagship. The Company will endeavor to enhance its profitability and achieve sustainable high growth in the future. ”