Time Real Estate Holdings Limited (01233.HK) recently released its 2017 interim results announcement. The announcement shows that in the first half of 2017, time real estate contract sales, turnover, profits and other core indicators have achieved steady improvement, while the overall leverage began to reduce, many financial ratios still maintain a healthy area, in addition, the group will continue to benefit from Guangdong-Hong Kong-Macau Greater Bay Area, high-quality land reserves will support the group's development and re-start rising space.

The ideal of contract sales and profitability are gradually enhanced.

The contract sales of time Real Estate in the first half of 2017 were ideal, the amount was 17.03 billion yuan, up 27.5% over the first half of 2016, its turnover increased by 53.1% compared with the same period last year, and its gross profit margin slightly increased by 0.1% to about 26.4%. Time's profitability increased by 53.5% year-on-year, reaching 2.3 billion yuan in the first half of the year. During the period, core net profit surged 81.4 per cent year-on-year to 940 million yuan. However, during the period, the core net profit belonging to ordinary shareholders only increased by 17.6% compared with the same period last year, reaching 636 million yuan, mainly because the settlement of joint venture projects was mostly carried out in the first half of the year, and the cooperative development of projects is a common phenomenon in China at present. First, the combination of strong and powerful companies has advantages, and second, it helps to obtain lower capital costs. However, management said that the settlement proportion of joint projects will fall sharply in the second half of the year, and the proportion of minority shareholders is not expected to be so high for the whole year.

Improvement of asset structure and enhancement of solvency

In terms of assets, the total assets of time Real Estate by the end of June this year were 24.1% higher than those by the end of December 16, of which current assets increased by 23.67% compared with the end of last year, mainly reflected in the increase in cash and cash equivalents, accounts receivable and inventory. Its cash and cash equivalents are 13.13 billion yuan, which can fully cover 2.45 billion yuan of short-term debt. Non-current assets increased by 26.55% compared with the end of last year, mainly reflected in the increase in net fixed assets, the better return on equity investment and the increase in the value of land use rights. In terms of liabilities, the total liabilities at the end of June this year were 16.9% higher than those at the end of December 16, with little change in current liabilities and 16.93% in non-current liabilities compared with the end of last year, mainly reflected in the increase in long-term borrowing. The increase in liabilities is mainly reflected in non-current liabilities, which is conducive to the stability of its financial structure, resulting in a decline in the ratio of current liabilities to total liabilities, from 62.53% at the end of last year to 54.46% in the middle of this year. With the current ratio and quick ratio rising to a benign area, the short-term debt service pressure of the era is almost zero. At the same time, the increase in assets has also reduced the group's asset-liability ratio from 76.57% at the end of last year to 72.14% in the middle of this year. Due to the group's good revenue, shareholders' rights and interests increased by 47.53% compared with the end of last year, and the property rights ratio also decreased from 3.27 at the end of last year to 2.59 in the middle of this year. The group leverage has been reduced, while the basic financial structure has been improved to a certain extent.

Taking advantage of the east wind of the Great Bay area, sufficient soil reserves support its upward performance.

The real estate land reserve of the times is about 14.5 million square meters, and it is concentrated in the core cities in the Pearl River Delta region and in Guangdong-Hong Kong-Macau Greater Bay Area. In the first half of 2017, the central government positioned Guangdong-Hong Kong-Macau Greater Bay Area as a world-class bay area. Throughout the development of the world-class Greater Bay area and the changes in the average price of house prices in the bay area, they all went up with the change of their per capita GDP. The per capita GDP of the San Francisco Bay area, the New York Bay area and the Tokyo Bay area is US $111900, US $59800 and US $41400 respectively, while the per capita GDP of the Guangdong, Hong Kong and Macao Bay area is only US $18300 in the same period. After the announcement of the continuation Bay area, it is expected that the policy will be implemented one after another. At that time, the Guangdong, Hong Kong and Macao Bay area may speed up and shift gears. The acquisition time of the real estate land reserve is basically before the establishment of the Great Bay area, which not only confirms the foresight of the main leaders of the Group, but also reflects from the side that the acquisition cost of these high-quality land reserves is relatively low and the probability of obtaining a premium is on the high side; in addition, the Times has an old city renovation project covering an area of nearly 1.23 million square meters, which can realize a land reserve of about 3.66 million square meters. Sufficient land reserves and old city transformation projects are sufficient to support the development of the times in the next 3-5 years, and also build sufficient safety cushions for its operation. The excellent performance of the times, as can be seen from its financial statement and high-quality land reserves, the Group continues to make efforts to create new growth space.