China Vanke Co., Ltd.
2014 First Quarterly Report
§1 Important Notice
1.1 The Board, the Supervisory Committee, Directors, members of the Supervisory Committee and
senior management of the Company warrant that in respect of the information contained in this
Quarterly Report, there are no misrepresentations or misleading statements, or material omission,
and individually and collectively accept full responsibility for the authenticity, accuracy and
completeness of the information contained in this Quarterly Report.
1.2 None of the Directors, members of the Supervisory Committee and senior management fails to
assure or disputes with the authenticity, accuracy and completeness of the contents of this Quarterly
Report.
1.3 Deputy Chairman Qiao Shibo and Director Wei Bin were not able to attend the board meeting in
person due to their business engagements and had authorised Director Chen Ying to represent them
and vote on behalf of them.
1.4 This quarterly financial report of China Vanke Co., Ltd. (the “Company”) and its subsidiaries (the
“Group”) was in accordance with the International Financial Reporting Standards (“IFRSs”) and
has not been audited. The significant accounting policies adopted in preparing the following financial
information are consistent in all material respects with those adopted by the Group for the year ended
31 December 2013.
1.5 The Company’s Chairman Wang Shi, Director and President Yu Liang, and Director, Executive
Vice President and Supervisor of Finance Wang Wenjin declare that the financial report contained in
this Quarterly Report is warranted to be true and complete.
§2 Basic Corporate Information
2.1 Major accounting data and financial guidance
（Unit: RMB’000）
As at 31 March 2014 As at 31 December 2013 Changes (%)
Total assets 495,386,717 479,474,818 3.32%
Equity attributable to equity
73,543,696 76,895,983 -4.36%
shareholders of the Company
Share capital (Unit: share) 11,014,968.919 11,014,968,919 -
Net assets per share attributable to
equity shareholders of the 6.68 6.98 -4.36%
Company(Unit: RMB)
January to March 2014 January to March 2013 Changes (%)
Revenue 9,007,858 13,195,692 -31.74%
Profit attributable to equity
1,529,479 1,613,904 -5.23%
shareholders of the Company
Net cash generated from operating
(5,579,131) (2,383,261) -134.10%
activities
Net cash generated from operating
(0.51) (0.22) -134.10%
activities per share (Unit: RMB)
Basic earnings per share(Unit: RMB) 0.139 0.147 -5.13%
Diluted earnings per share(Unit: RMB) 0.139 0.147 -5.13%
Decreased by 0.52
Return on equity 1.97% 2.49%
percentage point
Note: The net assets used to calculate the above net assets per share and return on equity refers to the equity
attributable to equity shareholders of the Company, while the net profit used to calculate the earnings per share refers to
the profit attributable to equity shareholders of the Company.
2.2 Total number of shareholders and shareholdings of the top 10 shareholders of non-restricted
tradable shares as at the end of the reporting period
As at the end of 31 March 2014, the total number of shareholders of the Company was 736,625
(including 718,506 holders of A shares and 18,119 holders of B shares).
Total number of shareholders as at the end of the reporting period 736,625
Shareholdings of the top 10 shareholders
Classification Percentage of Total Number of Number of
Name of shareholder of shareholding number of restricted pledged or
shareholder s shares held shares held lock-up shares
State-owned
China Resources Co., Limited (“CRC”) 14.94% 1,645,494,720 0
legal person
Liu Yuansheng Others 1.21% 133,791,208 0
HTHK/CMG FSGUFP – CMG FIRST STATE CHINA Foreign
1.01% 111,756,974 0
GROWTH FD shareholder
103 Portfolio of National Social Security Fund, PRC Others 0.96% 105,992,742 0
China Minsheng Bank – Yinhua Shenzhen 100 Index
Others 0.87% 95,413,407 0
Classified Securities Investment Fund
China Construction Bank – Bosera Theme Industry
Others 0.82% 89,999,092 0
Stock Securities Investment Fund
China Life Insurance Company Limited – Dividend
Others 0.75% 83,091,653 0
Distribution – Individual Dividend-005L–FH002 Shen
China Pacific Life Insurance Co., Ltd. – Dividend
Others 0.75% 82,131,639 0
Distribution – Individual Dividend
CSOP Asset Management Limited－CSOP FTSE China
Others 0.73% 80,646,229 0
A50 ETF
ICBC – Rongtong Shenzhen Stock Exchange 100 Index
Others 0.68% 74,504,134 0
Securities Investment Fund
Remarks on strategic investor or ordinary legal person
becoming top 10 shareholders after placing of new Nil
shares
Shareholdings of the top 10 holders of non-restricted shares
Name of shareholder Number of non-restricted Class of shares
shares held
China Resources Co., Limited (“CRC”) 1,645,494,720 Ordinary RMB-denominated shares (A shares)
Liu Yuansheng 133,791,208 Ordinary RMB-denominated shares (A shares)
HTHK/CMG FSGUFP – CMG FIRST STATE CHINA
111,756,974 Domestic listed foreign shares (B shares)
GROWTH FD
103 Portfolio of National Social Security Fund, PRC 105,992,742 Ordinary RMB-denominated shares (A shares)
China Minsheng Bank – Yinhua Shenzhen 100 Index
95,413,407 Ordinary RMB-denominated shares (A shares)
Classified Securities Investment Fund
China Construction Bank – Bosera Theme Industry
89,999,092 Ordinary RMB-denominated shares (A shares)
Stock Securities Investment Fund
China Life Insurance Company Limited – Dividend
83,091,653 Ordinary RMB-denominated shares (A shares)
Distribution – Individual Dividend-005L–FH002 Shen
China Pacific Life Insurance Co., Ltd. – Dividend
82,131,639 Ordinary RMB-denominated shares (A shares)
Distribution – Individual Dividend
CSOP Asset Management Limited－CSOP FTSE China
80,646,229 Ordinary RMB-denominated shares (A shares)
A50 ETF
ICBC – Rongtong Shenzhen Stock Exchange 100 Index
74,504,134 Ordinary RMB-denominated shares (A shares)
Securities Investment Fund
It is not known as to whether there are connections or persons deemed to be acting in
Remarks on the connected relationship or action in
concert under “the Measures for the Administration of the Takeover of Listed
concert of the aforementioned shareholders
Companies” among the above-mentioned shareholders.
Remarks on shareholders involved in securities margin Nil
trading
As at the end of 31 March 2014, the total number of shares of the Company was 11,014,968,919,
including 9,700,013,451 A shares and 1,314,955,468 B shares.
§3 Management Discussion and Analysis
During the reporting period, the sales area of commodity housing in China decreased by 5.7%
year-on-year. One of the main reasons was that commodity housing sales rebounded significantly in
2013, leading to a relatively higher comparative figure for 2014. When compared with the same
period of 2012, the sales area of commodity housing in China in the first quarter of 2014 increased by
33.2%.
In early 2013, the growth rate of housing sales in 14 major cities, namely Beijing, Shanghai,
Shenzhen, Guangzhou, Tianjin, Shenyang, Hangzhou, Nanjing, Chengdu, Wuhan, Dongguan, Foshan,
Wuxi and Suzhou, was higher than the national growth rate. During the reporting period, housing
sales in these cities declined considerably when compared with the same period of 2013. The sales
area of residential properties in the 14 cities in the first quarter of 2014 saw a year-on-year drop of
27.5%, while the sales area of commodity housing to approved pre-sales area of new housing ratio
was 1.0. The new supply and sales were basically balanced. As at the end of March, inventory of
saleable new homes (those that have obtained sales permit but have not yet been sold) in the
above-mentioned 14 cities was 122 million sq m, which was basically the same as that at the end of
2013.
During the reporting period ,the site area supplied and sold in 16 major cities (Shenzhen, Guangzhou,
Dongguan, Foshan, Shanghai, Hangzhou, Nanjing, Suzhou, Ningbo, Beijing, Tianjin, Shenyang,
Dalian, Chengdu, Wuhan and Chongqing) where statistics are accessible by the public decreased by
1.5% and 5.9% respectively, on a year-on-year basis. The land sales in major cities have slowed down
after entering March. Although the average land transaction price remained at a high level, the
proportion of land lots changed hands at a premium decreased when compared to the peak in the third
quarter of last year.
During the reporting period, the Company continued to implement its mainstream positioning and
proactive sales strategy. In the first quarter, the Company achieved an accumulated sales area of
4,150,000 sq m, with a sales amount of RMB54.23 billion, representing year-on-year increases of
11.7% and 24.2% respectively. Among the commodity housing units sold, homes smaller than 144 sq
m took up 93.8%.
In Guangshen region, the Company realized a sales area of 1,077,000 sq m and sales amount of
RMB14.98 billion. In Shanghai region, the Company realized a sales area of 1,329,000 sq m and sales
amount of RMB19.29 billion. In Beijing region, the Company realized a sales area of 925,000 sq m
and a sales amount of RMB12.49 billion. In Chengdu region, the Company realized a sales area of
819,000 sq m and sales amount of RMB7.46 billion.
There is a certain seasonal trend for project completion and recognition in the property industry. A
majority of the projects are completed and recognised in the second half of the year, especially in the
fourth quarter. Since the amount of project completion and booked area in the first quarter accounted
for a relatively small proportion of the full year’s total, which led to a relatively large year-on-year
change, the booked items for the first quarter were insignificant reference for the outlook for the
full-year operating results. In the first quarter of 2014, the Company's completed area amounted to
984,000, accounting for only 6.6% of the planned area to be completed for the full year, which was
lower than that of previous years. Affected by this, the Company realized a booked area and booked
revenue of 727,000 sq m and RMB8.58 billion respectively for the first quarter, representing
year-on-year decreases of 41.1% and 31.6% respectively. Meanwhile, the Company realized revenue
and net profit of RMB9.01 billion and RMB1.53 billion respectively, representing year-on-year
decreases of 31.7% and 5.2% respectively. The Company expected that the area to be completed for
the full year of 2014 will basically meet the target set at the beginning of the year, while the operating
results are expected to continue to grow steadily in 2014.
During the reporting period, the Company’s net profit margin increased significantly, mainly
attributable to the following reasons: 1) Booked gross profit margin of the Company’s property
business rose by 3.59 percentage points from that of the corresponding period of last year to 31.99%
of the reporting period due to a higher percentage of booked revenue contribution from cities with
high profit margin such as Shanghai and Shenzhen in the first quarter. 2) The Company realized other
net income of RMB537 million in the reporting period, increased by RMB518 million when
compared with the corresponding period last year, which was mainly contributable from income from
collaborative projects through equity transfer and income from disposal of commercial properties
through equity transfer; 3) The share of profit from the Company’s associates and joint ventures
amounted to be RMB236 million, increased by approximately RMB201 million from that in the
corresponding period last year. The Company is actively exploring and promoting light asset
operational model. The scope of cooperation will be broadened in future, and associates and joint
ventures will account for a greater percentage in the Company’s overall operation. The Company will
also be involved in more activities of introducing partners by disposing certain equity interests in a
project, and engaging in the operation of investment properties disposed of through equity transfer.
With light asset operational model, the Company, under normal conditions, still engages in the
management and operation of development projects or investment properties, despite certain equity
interests in these projects or investment properties being disposed of by the Company or the fact that
Company has only a relatively small percentage of shareholding in certain joint-venture projects or
investment properties. As such, the Company can receive a certain amount of management fee, or
request a share of profit higher than its shareholding percentage. Such arrangement is beneficial for
the Company to increase its return on equity.
As at the end of the reporting period, the Company had an area of 17,105,000 sq m sold but not yet
booked stated in the consolidated statements as construction had yet to be completed. This area and its
corresponding contract amount of approximately RMB195.57 billion represented increases of 19.0%
and 20.5% respectively when compared with those at the beginning of the year.
During the reporting period, the Company acquired 8 new development projects, with a site area
attributable to Vanke's equity holding of approximately 462,000 sq m, representing a planned GFA of
approximately 1,348,000 sq m, and an average land premium basing on floor area of approximately
RMB4,535 per sq m. The Company will continue to pursue prudent land acquisition strategy. While
persevering with strict control of investment risks, the Company will make proper land bank
replenishment according to actual development needs.
In the first quarter, the Company achieved a floor area of housing starts of 4,200,000 sq m, accounting
for 18.8% of the full year plan for housing starts. As the floor area of housing starts will gradually
increase, the Company expects that its floor area of housing starts for the full year will be higher than
that set at the beginning of the year.
As at the end of the reporting period, the Company’s net gearing ratio was 40.9%, while the cash and
cash equivalents including the pledged deposit held by the Company amounted to RMB37.53 billion,
which was more than the sum of short-term borrowings and long-term borrowings due within one
year of RMB27.91 billion. The Company had a sound and solid financial position.
§4 Significant Events
4.1 Significant changes and reasons for such changes in major items of the accounting
statements and financial guidance of the Company
√Applicable □Not applicable
31 December
31 March 2014 Change
Items 2013 Reasons for change
(RMB'000) (+/-)
(RMB'000)
Trade and other receivables 81,681,629 68,218,739 19.73% Expansion of operating scale
Interest in joint ventures 8,107,327 6,897,969 17.53% Increase of joint-venture projects.
Non-current loans and
43,772,083 36,683,128 19.32% Fluctuation of fi
