Events:

According to the 2016 report released by the company a few days ago, the company achieved operating income of 2.571 billion yuan, an increase of 6.73 percent over the same period last year, an operating profit of 340 million yuan, an increase of 137 percent, and a net profit of 220 million yuan belonging to shareholders of listed companies, an increase of 72.90 percent over the same period last year, and EPS was 0.46 yuan per share, an increase of 39 percent over the same period last year.

Viewpoint:

Both operating profit and net profit rose sharply. During the reporting period, the company achieved operating income of 2.571 billion yuan, an increase of 6.73% over the same period last year, an operating profit of 340 million yuan, an increase of 137% over the same period last year, and a net profit of 220 million yuan belonging to shareholders of listed companies, an increase of 72.90% over the same period last year. EPS was 0.46 yuan per share, an increase of 39% over the same period last year. The substantial increase in operating profit and net profit is mainly due to the transfer of the equity of Jinyi Trading Co., Ltd., the overall sale of the Victoria Harbour Park project on Yongxing Street in Hong Kong, and the investment income from the reduction of Huiquan Beer stock during the reporting period. as well as the large-scale carry-over of the Wuyi Mingshi Park project in Nanjing, but the low gross profit margin of the investment projects opened up by international Ethiopia, Uganda and other new markets, as well as the strong de-inventory efforts in China. As a result of the impact of price reduction promotion, the overall gross profit margin decreased significantly during the reporting period.

Real estate development + international project contracting double main business, the growth rate of real estate development is obvious. The operating income in 2016 was 2.571 billion yuan, an increase of 6.73 percent over the same period last year, of which the operating income of international project contracting business was 964 million yuan, an increase of 4.24 percent over the same period last year, and that of real estate business was 1.5 billion yuan, an increase of 8.02 percent over the same period last year. The area of pre-sale and sales of real estate development business is about 270000 yuan in the whole year, and the sales revenue is about 3.2 billion yuan.

In 2016, the company is building 17 real estate projects with a construction area of about 1.5 million square meters, mainly in Beijing, Nanjing, Chongqing, Yangzhou, Fujian, Hong Kong and Kenya. What is noteworthy is that the Wuyi Garden South District project being developed by the company, which is located in Tongzhou, Beijing, is close to the administrative deputy center of Beijing and has a superior geographical location, which will become the profit growth point of the company in the next few years.

In 2017, the company plans to increase its land reserve by 2750 mu, including 480mu at home and 2270 mu abroad, with a planned new construction area of 200000 mu, completed investment of 3.6 billion yuan, sales of 380000 mu, and real estate development and operation business income of 2.7 billion yuan.

Actively explore the international market and benefit from the dividend of the "Belt and Road Initiative" policy. At present, the company's international project contracting business has established an African regional market with Kenya as the center, and actively expanded to neighboring countries such as the Philippines, Uganda, Tanzania, Ethiopia, Papua New Guinea and East Timor. Showing the momentum of letting a hundred flowers blossom.

By the end of 2016, 35 projects were under construction for the whole year, with a contract value of about 7 billion yuan. Benefiting from the national "Belt and Road Initiative" strategy, China's newly signed contracts for foreign contracted projects increased by 16.2% in 2016 compared with the same period last year, and increased by 36% in the Belt and Road Initiative market. With the "Belt and Road Initiative"

With accelerated progress, it is expected that the amount of newly signed contracts for foreign contracted projects in China will continue to grow at a high speed in the future. In view of this, the company continues to cultivate the national construction market along Belt and Road Initiative, radiating to the neighboring countries with Kenya, Ethiopia and the Philippines as regional centers, and vigorously expand the Asian and African markets.

In 2017, 15 new construction contracts are planned to be signed, with a contract value of about 3 billion yuan.

Based on international business, actively expand business transformation and upgrading. In 2016, the company invested in the construction of industrial R & D and production bases and building materials supermarkets in Kenya, which is scheduled to be put into use in the second half of 2017. The development and growth of the company's international business will not only enhance the competitiveness of the company to undertake international engineering projects, but also promote the export of building materials, construction machinery, home appliances and labor services, and realize the transformation and upgrading of the company's business.

We will actively expand financing channels and optimize the debt structure. The company actively implemented the direct financing plan. In February 2016, the company successfully completed the 2015 rights issue, raising 1.075 billion yuan, greatly optimizing the company's asset structure, and reducing the debt-to-capital ratio to 3.7 from 6.2 at the end of last year. In November 2016, the company once again launched the 2016 non-public offering of shares, with Kenya construction industrial R & D and production base and building materials supermarket as investment projects, with a plan to raise 550 million yuan.

The company uses long-term debt to replace short-term debt and low-interest debt to replace high-interest debt, greatly reducing debt costs and debt repayment pressure. at the same time, abundant funds form a strong support for the company's real estate development investment and international project contracting in 2017.

Risk hint: the real estate policy is further tightened and the international business is faced with political, economic and exchange rate risks in the host country.