Source: Media Outreach
Revenue and Core Net Profit Increase 10.5% and 14.4% to RMB388 million and RMB270 million Respectively Despite COVID-19
Core operating performance continues an upward trend, revenue up 10.5% to RMB388 million while core net profit up 14.4% to RMB270 million.
Occupancy rate for stabilized logistics parks remains high at 89.7%; gross floor area (GFA) of investment projects is approximately 4.39 million sq.m and GFA of land held for future development is approximately 5.01 million sq.m.
Steadily developed investment fund project. The Group announced the establishment of the second phase of the fund with LaSalle Investment Management Asia Pte. Ltd. in March 2020 to accelerate the Group’s transformation to an asset-light operation model.
HONG KONG, CHINA – Media OutReach – 28 August 2020 – China Logistics Property Holdings Co., Ltd (“CNLP” or the “Company”, together with its subsidiaries, the “Group”; stock code: 1589), a leading provider of logistics facilities in China, today announced its unaudited interim results for the period ended 30 June 2020.
In the first half of 2020, the COVID-19 pandemic severely impacted the global economy; however, the development resilience of the domestic logistics industry and the Group’s development capabilities emerged during the pandemic. Facing such operation uncertainties, the Group still maintained its excellent operation and financial position. In the first half of the year, the Group’s revenue increased 10.5% year-on-year to RMB388 million, core net profit increased 14.4% year-on-year to RMB270 million, which accounted for 69.6% of the total revenue of the Group. Profit for the period decreased RMB212 million to RMB1.90 million, mainly because of convertible bonds issuance in June 2019 by the Company. While the Company’s share price continued to rise as of 30 June 2020, and the value of convertible bonds increased. According to International Financial Reporting Standard 9 “Financial Instruments” and International Accounting Standard 32 “Financial Instruments: Disclosure and Presentation”, such changes in fair value are gradually reflected in the equity attributable to owners of the Company through equity and premium or retained earnings on or before the maturity date of the convertible bonds. The Company thus incurred a loss of approximately RMB185 million. However, as fair value losses on convertible bonds are a non-cash charge, it does not affect the Company’s liquidity. The Group’s cash flow remained stable, and its cash and cash equivalents reached RMB1,230 million in the first half of the year.
Throughout the first half of the year, even with the economic downturn caused by the COVID-19 pandemic, the Group’s occupancy rate for stabilized logistics parks remained high at 89.7%, of which, tenants in e-commerce and third-party logistics providers (“3PL”) accounted for approximately 87.2% of overall leasing segment. Leveraging the continuous development of e-commerce and third-party logistics services in China, the Group’s leasing business will continue its healthy development.
As of 30 June 2020, the Group’s GFA reached 4.39 million sq.m., and GFA of land held for future development was approximately 5.01 million sq.m.
The Group continues to accelerate the development of the asset-light business model. Despite the huge impact of the COVID-19 outbreak, in March 2020, the Company entered into an agreement on the second phase of the fund with LaSalle Investment Management Asia Pte. Ltd., jointly investing RMB663 million to set up a core fund to operate China Logistics’ warehousing projects. The Company has taken on the role of an asset manager to provide project and property management services for the projects. Since the Company announced its move to the asset-light business model in August 2018, the Company has been involved in fund projects covering 1 million sq.m. with an asset management scale of RMB5 billion.
Mr. LI Shifa, Chairman, CEO and President of CNLP, said, “The COVID-19 pandemic has brought about an unprecedented impact on the global economy since the beginning of this year. However, leveraging the Group’s commitment to providing premium nationwide networked logistics parks and the continuous growth of the e-commerce and third-party logistics industries, the Group has achieved steady growth in its core business despite the pandemic. As the pandemic in mainland China was gradually brought under control with economic activities returning to normal, the market demand for premium logistics facilities is also expected to return to normal, and we believe the growth trend will continue in the future.”
 The Group defines its core net profit as its adjusted EBITDA, which consists of profit for the period, adding back our net interest expenses, transaction cost of convertible bonds, net exchange losses, income tax expense, amortization expense, depreciation charge and other one-off transaction expenses, further adjusted to deduct our other income, fair value gains on investment properties — net, fair value losses on convertible bonds — net and other gains/(losses) — net, interest income on bank deposits, net exchange gains and share of profit of investments accounted for using the equity method.
– Published and distributed with permission of Media-Outreach.com.