Opinion Real Estate Network News:On the evening of August 31, China Jinmao Holdings Group Co., Ltd. issued a notice proposing the spin-off of Jinmao property Development Co., Ltd. on the main board of the Stock Exchange of Hong Kong Limited.
According to the subsequent prospectus, Jinmao property Development Co., Ltd. mainly provides a full range of quality property management and value-added services for the high-end residential property portfolio. At the same time, it also manages and operates a diversified and growing portfolio of commercial properties (and public property).
It is reported that Jinmao property develops three business lines, namely property management services (including urban operation services), non-owner value-added services, and community value-added services.
As of March 31, 2021, in 27 cities in 18 provinces, autonomous regions and municipalities directly under the Central Government, Jinmao property has a total construction area of 18.1 million square meters, including 67 residential projects and 34 non-residential projects; the contracted construction area is about 41.3 million square meters. It covers 45 cities in 22 provinces, autonomous regions and municipalities in China, of which 71.4% are located in first-and second-tier cities in China.
As at the latest practicable date, Jinmao property's property management portfolio covers residential properties and various types of non-residential properties, including commercial properties (such as offices and shopping malls) and public and other properties (such as schools, government facilities and other public spaces). As of March 31, 2021, the construction area of Jinmao property, residential property and non-residential property is about 15 million square meters and 3.1 million square meters respectively, accounting for 82.5% and 17.5% of the total construction area respectively.
In addition, according to the opinion real estate new media, as Jinmao Group itself contracted urban operation projects, as of the last practical date, Jinmao property has entered into preliminary property management contracts for 19 urban operating projects of Jinmao Group. These projects represent a diversified combination of office complexes, new towns, cultural towns and smart cities in Shanghai, Changsha, Lijiang, Qingdao, Nanjing, Sanya, Wenzhou and Tianjin, and operate eight of them.
In terms of operation, the income of Jinmao property increased from 575 million yuan in 2018 to 788 million yuan in 2019, and further increased to 944 million yuan in 2020, with a compound annual growth rate of 28.2% from 2018 to 2020. Revenue for the three months ended 31 March 2021 was $321 million.
At the same time, the annual profit of Jinmao property increased from 17.5 million yuan in 2018 to 22.6 million yuan in 2019, and further increased to 77.1 million yuan in 2020, with a compound annual growth rate of 110.0% from 2018 to 2020. For the three months ended 31 March 2021, the profit was $14.6 million, compared with a net loss of $16 million for the same period in 2020.
The overall gross profit increased by 55.0% from 151 million yuan in 2019 to 235 million yuan in 2020. The overall gross profit margin increased from 19.2% in 2019 to 24.9% in 2020, mainly due to the higher gross profit margin of the property management business and the increase in revenue from pre-delivery services and community space operation services. These services usually generate higher gross margins than other services provided by Jinmao property.
In terms of property management service income by project source, from 2018 to 2020, Jinmao property management service income from Jinmao Group and Sinochem Group (and their respective joint ventures and associated companies) accounted for 92%, 93.3% and 92.5% respectively.
Jinmao property also said that since 2020, it is actively committed to seeking property management appointments for projects developed by independent third-party property developers to benefit from economies of scale, obtain additional sources of income, diversify the property management portfolio and reduce reliance on Sinochem, our single largest customer. As of March 31, 2021, the contracted floor area of Jinmao property developed by an independent third party is 2.7 million square meters.
In terms of management, the Chairman of the Board of Directors is Jiangnan, who is responsible for formulating business strategy and providing guidance on the overall development of the Group; the CEO is Xie Wei and the Chief Financial Officer is Zhou Liye. At the same time, Wang Yongli, Li Yulong, Wei Dong, Cai Yun and Zhan Yu served as vice presidents.
It is reported that Jiangnan has been in the Finance Department of Sinochem Group since July 1995. From August 2002 to January 2006, he served as the Manager of the Capital Department of Sinochem Hong Kong, an overseas investment platform enterprise of Sinochem Group, and was responsible for the centralized operation of overseas funds of Sinochem Group.
Jiangnan joined Jinmao Group in January 2006 as Chief Financial Officer of Jinmao of China, served as Executive Director of Jinmao of China from 2007 to 2011, and was re-appointed Executive Director of Jinmao of China in August 2015. He is in charge of strategic management, accounting and finance, budget evaluation, capital markets and investor relations of Jinmao Group.
He has also been the general manager of Jinmao Capital Holdings Limited since June 2019, responsible for the overall operation and management of the company, and has been a non-executive director of Jinmao (China) Hotel Investment Management Co., Ltd since March 2014.