Financial Performance - The financial summary indicates a robust performance with total revenue growth of 15% year-on-year, reaching HKD 50 billion[3] - Future outlook includes a projected revenue growth of 10% for the upcoming fiscal year, driven by new product offerings and market expansion strategies[3] - Revenue for the year ended December 31, 2021, was RMB 242.24 billion, an increase of 30.4% compared to RMB 185.79 billion in 2020[10] - Profit attributable to shareholders decreased by 8.5% to RMB 40.16 billion from RMB 43.90 billion in the previous year[10] - The company reported a significant increase in revenue, achieving a total of 32 billion RMB for the year, representing a growth of 15% year-over-year[126] - The company reported a net profit margin of 12% for the last fiscal year, with plans to increase it to 15% through cost-cutting measures[129] Property Development and Sales - The company reported a significant increase in property development activities across 86 major cities in mainland China, including Beijing, Shanghai, and Guangzhou[9] - Contracted property sales reached RMB 369.50 billion, a growth of 2.4% from RMB 360.72 billion in 2020[10] - The group achieved a sales contract amount of RMB 369.5 billion, a year-on-year increase of 2.4%, with sales area corresponding to 18.9 million square meters[54] - Property development revenue reached RMB 236.36 billion, up 30.7% year-on-year[53] - The company has reported a 30% increase in land reserves, positioning itself for future growth opportunities in key urban areas[9] Strategic Expansion and Investments - The company plans to expand its commercial property portfolio in Hong Kong and Macau, targeting a 20% increase in new project launches in the next fiscal year[9] - The company is exploring potential mergers and acquisitions to enhance its market presence, with a focus on strategic partnerships in the Asia-Pacific region[3] - The company plans to expand its market presence by entering three new cities in the next year, aiming for a 30% increase in market share in those regions[130] - A strategic acquisition of a local competitor is in progress, which is expected to enhance the company's operational capabilities and increase revenue by an estimated 5 billion RMB annually[126] Research and Development - The company has allocated HKD 1 billion for research and development of new technologies aimed at enhancing property management efficiency[3] - The company is investing 1 billion RMB in research and development to innovate sustainable building materials over the next three years[127] - New product development includes the launch of a cutting-edge construction technology that is projected to reduce project costs by 10%[129] Sustainability and ESG Initiatives - The company was awarded the Platinum Award for the "Environmental, Social and Governance Benchmark Awards" by the IESGB, reflecting its commitment to sustainable development[30] - The company has implemented a comprehensive ESG strategy framework, achieving recognition in the newly launched Hang Seng ESG Screening Index and Low Carbon Index, with a lower carbon emission intensity compared to peers[145] - In 2021, the company completed 80 green building certification projects, with a certified building area of 12.73 million square meters, including the first national three-star green operation label in Chongqing[148] - The company has launched the "Zhonghai Green Healthy Residential Standards" based on health building evaluation standards, initiating project trials to promote green and healthy living[148] Corporate Governance and Management - The board of directors consists of 4 executive directors, 2 non-executive directors, and 3 independent non-executive directors, reflecting a diverse skill set and experience[179] - The company has established various committees to oversee internal governance and control, including an audit and risk management committee[177] - The board has adopted a diversity policy to ensure sustainable and balanced development, considering factors such as gender, age, and professional experience[178] - The company has established a corporate governance committee at the board level to enhance oversight of ESG matters, with independent non-executive directors as key members[144] Market Presence and Customer Engagement - User data shows a 25% increase in customer inquiries and engagement through digital platforms, reflecting a shift towards online services[3] - The company has established a national promotion campaign targeting nearly 10 million homeowners and customers to enhance brand awareness and sales of quinoa products[156] - Customer satisfaction score reached 88 points in 2021, ranking among the top three in the industry, based on over 120,000 random samples surveyed[151] Financial Management and Debt - The company maintained a debt-to-asset ratio of 58.9% and a net gearing ratio of 32.3%, remaining within the "green file" and not breaching any of the "three red lines"[48] - The weighted average financing cost for the group was 3.55%, maintaining the lowest range in the industry[113] - The total borrowings of the group reached RMB 241.92 billion, an increase from RMB 212.98 billion in the previous year[119] - The company has not breached any of the "three red lines" set by the central bank's real estate financial regulation policy, categorizing it as a "green file" enterprise[113] Employee Development and Training - The company has conducted over 600 training sessions, covering 110,000 training participants, with an average of 86 training hours per employee in 2021[153] - The average training hours per employee in the year were 86 hours, reflecting the company's commitment to continuous training and development[160] - The company has awarded stock options totaling 400,290,000 shares to 1,597 senior management and key technical personnel as part of its equity incentive plan[152]

Financial Performance - In Q1 2022, the group achieved contract property sales of RMB 48.28 billion, corresponding to a sales floor area of 2.51 million square meters[3]. - The group's revenue for the three months ended March 31, 2022, was RMB 28.83 billion, representing a year-on-year increase of 5.7%[4]. - Operating profit for the same period was RMB 7.16 billion, which includes gains from equity acquisitions and foreign exchange net gains, reflecting a year-on-year increase of 15.8%[4]. - As of March 31, 2022, the group's bank balance and cash amounted to RMB 114.74 billion, with a net gearing ratio of 43.1%[4]. Land Acquisition - The group acquired 6 new land parcels in 5 cities in mainland China, adding a total floor area of 780,000 square meters, with a land cost of RMB 14.74 billion[3]. Market Outlook - The real estate market in China showed signs of recovery in March 2022 after a sluggish start to the year, supported by government policies aimed at stabilizing land prices and housing prices[2]. - The group expects the Hong Kong property market to stabilize as the pandemic situation improves[2]. Strategic Focus - The group emphasizes cash flow management and cost control to maintain industry-leading profitability amid economic uncertainties[2]. - The group remains committed to high-quality development based on financial stability[4]. Forward-Looking Statements - The announcement contains forward-looking statements that may involve risks and uncertainties, and actual performance may differ from these statements[5].

[Company Information and Financial Highlights](index=2&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99%E8%88%87%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) [Company Business Structure](index=3&type=section&id=%E5%85%AC%E5%8F%B8%E6%A5%AD%E5%8B%99%E6%9E%B6%E6%A7%8B) The company's core business covers property development, commercial property operations, and other real estate-related activities, with projects across 84 mainland Chinese cities, Hong Kong, Macau, and London - The company's main business is divided into three segments: property development, commercial properties, and other real estate-related businesses[3](index=3&type=chunk) - Property development business covers 84 cities in mainland China, extending to Hong Kong, Macau, and London, demonstrating broad geographical distribution[3](index=3&type=chunk) [Financial Highlights](index=4&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) The report presents key financial indicator trends from 2017 to H1 2021, including revenue and equity attributable to shareholders growth Equity Attributable to Shareholders Trend (RMB Billion) | Year | 2017 | 2018 | 2019 | 2020 | 2021 H1 | | :--- | :--- | :--- | :--- | :--- | :--- | | Amount (RMB Billion) | 2,108.2 | 2,317.4 | 2,642.9 | 2,950.9 | - | [Company Information](index=5&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) This section provides essential company information including board and committee members, registered office, company secretary, share registrar, legal advisors, auditors, principal bankers, listing details, and key financial calendar dates - The company's Chairman is Mr. Yan Jianguo, and the CEO is Mr. Zhang Zhichao[9](index=9&type=chunk) - The company's independent auditor is Ernst & Young[10](index=10&type=chunk) 2021 Interim Financial Calendar | Event | Date | | :--- | :--- | | Interim Results Announcement | August 23, 2021 | | Ex-dividend Date | September 16, 2021 | | Record Date | September 20, 2021 | | Dispatch of Dividend Warrants | October 5, 2021 | [Chairman's Report](index=8&type=section&id=%E4%B8%BB%E5%B8%AD%E5%A0%B1%E5%91%8A%E6%9B%B8) Chairman Yan Jianguo reviews H1 2021 performance, highlighting steady growth amid tightening real estate policies, healthy financials, rational investment, and accelerated commercial asset development, expressing optimism for the industry and confidence in the Hong Kong property market Key Performance Indicators for H1 2021 | Indicator | Amount | YoY Growth | | :--- | :--- | :--- | | Revenue | RMB 107.88 Billion | +21.7% | | Operating Profit | RMB 31.40 Billion | - | | Gross Profit Margin | 28.5% | - | | Net Profit Margin | 19.3% | - | | Core Profit Attributable to Shareholders* | RMB 19.23 Billion | +10.9% | | Basic Earnings Per Share | RMB 1.90 | - | *Excluding fair value changes of investment properties after tax - The company maintains a healthy financial position, with a **60.2% asset-liability ratio** and **33.8% net gearing ratio**, not triggering the 'Three Red Lines' and remaining in the 'Green Category'; weighted average financing cost is **3.6%**, among the lowest in the industry[15](index=15&type=chunk) - The Group's contracted sales reached **RMB 207.21 billion**, a **20.5% year-on-year increase**; 49 new land parcels were added, with a total land premium of **RMB 77.81 billion**[16](index=16&type=chunk) - Commercial asset revenue reached **RMB 2.50 billion**, a **23.3% year-on-year increase**; 15 commercial projects are expected to launch in H2, adding approximately **1.01 million square meters** of commercial GFA[16](index=16&type=chunk) [Management Discussion and Analysis](index=11&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E8%88%87%E5%88%86%E6%9E%90) [Overall Performance](index=11&type=section&id=%E6%95%B4%E9%AB%94%E8%A1%A8%E7%8F%BE) In H1 2021, the Group achieved strong overall performance with revenue growing **21.7%** to **RMB 107.88 billion**, maintaining industry-leading profitability and a **10.9%** increase in core profit attributable to shareholders H1 2021 Overall Performance Overview | Indicator | Value | | :--- | :--- | | Revenue | RMB 107.88 Billion (+21.7% YoY) | | Operating Profit | RMB 31.40 Billion | | Gross Profit Margin | 28.5% | | Net Profit Margin | 19.3% | | Core Profit Attributable to Shareholders | RMB 19.23 Billion (+10.9% YoY) | | Basic Earnings Per Share | RMB 1.90 | [Property Development](index=11&type=section&id=%E7%89%A9%E6%A5%AD%E7%99%BC%E5%B1%95) Property development, a core revenue source, saw H1 revenue reach **RMB 105.01 billion**, up **21.6%**, with contracted sales growing **20.5%** to **RMB 207.21 billion**, and the land bank totaling **92.24 million square meters** - Property development revenue was **RMB 105.01 billion**, a **21.6% year-on-year increase**[19](index=19&type=chunk) - The Group's contracted sales amounted to **RMB 207.21 billion**, a **20.5% year-on-year increase**; corresponding GFA sold was **10.50 million square meters**, up **10.0% year-on-year**[19](index=19&type=chunk) - During the period, **20 new land parcels** were added in mainland China, with a total new GFA of **4.89 million square meters** and a total land premium of **RMB 51.30 billion**[25](index=25&type=chunk) - As of June 30, 2021, the Group's total land bank reached **92.24 million square meters**[27](index=27&type=chunk) [Property Investment](index=15&type=section&id=%E7%89%A9%E6%A5%AD%E6%8A%95%E8%B3%87) Investment property rental income grew **18.0% year-on-year** to **RMB 2.27 billion**, with office rental income up **14.0%** and shopping center rental income up **31.0%**, though fair value gains on investment properties significantly decreased by **60.9%** H1 2021 Investment Property Rental Income | Category | Revenue (RMB Billion) | YoY Growth (%) | | :--- | :--- | :--- | | Office Buildings | 1.74 | +14.0% | | Shopping Malls | 0.52 | +31.0% | | **Total** | **2.27** | **+18.0%** | - Fair value gains on investment properties were **RMB 2.03 billion**, a **60.9% year-on-year decrease**[28](index=28&type=chunk) [Liquidity, Financial Resources, and Debt Structure](index=15&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E3%80%81%E8%B2%A1%E6%94%BF%E8%B3%87%E6%BA%90%E5%8F%8A%E5%82%B5%E5%8B%99%E7%B5%90%E6%A7%8B) The Group maintains a robust financial position, adhering to 'Three Red Lines' regulations as a 'Green Category' enterprise, with a weighted average financing cost of **3.6%**, total borrowings of **RMB 228.45 billion**, and ample available funds of **RMB 170.49 billion** - Under domestic 'Three Red Lines' regulatory policies, the Group did not trigger any red lines, qualifying as a 'Green Category' enterprise[29](index=29&type=chunk) - The weighted average financing cost was **3.6%**, ranking among the industry's top tier[29](index=29&type=chunk) Debt and Liquidity Overview (As of June 30, 2021) | Indicator | Amount (RMB Billion) | | :--- | :--- | | Total Borrowings | 228.45 | | Borrowings Due Within One Year | 45.23 (19.8% of total) | | Bank Balances and Cash | 117.43 | | Unutilized Bank Facilities | 53.06 | | **Available Funds** | **170.49** | [Sustainable Development](index=18&type=section&id=%E5%8F%AF%E6%8C%81%E7%BA%8C%E7%99%BC%E5%B1%95) The Group made significant ESG progress under its 'Four Good Company' strategy, adding **48 green building certified projects**, enhancing SASB and TCFD disclosures, continuing rural revitalization efforts in Gansu, and employing **5,916 full-time staff** - Enhanced governance by increasing references to the Sustainability Accounting Standards Board (SASB) Standards and the Task Force on Climate-related Financial Disclosures (TCFD) Recommendations in ESG reports[37](index=37&type=chunk) - During the period, **48 new green building certified projects** were added, covering **8.01 million square meters**, bringing the cumulative total certified GFA to **80.80 million square meters**[37](index=37&type=chunk) - As of end-June 2021, the Group employed **5,916 full-time staff**[38](index=38&type=chunk) - Continued to support rural revitalization in Zhuoni, Kangle, and Kang counties in Gansu, and developed the 'Yun Jian Wo Ye' quinoa brand[38](index=38&type=chunk)[40](index=40&type=chunk) [Condensed Consolidated Financial Statements](index=24&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Condensed Consolidated Statement of Profit or Loss](index=25&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2021, Group revenue increased **21.7%** to **RMB 107.88 billion**, with profit attributable to shareholders slightly up **1.2%** to **RMB 20.78 billion**, and basic earnings per share at **RMB 1.90** Condensed Consolidated Statement of Profit or Loss Summary (For the six months ended June 30) | Indicator (RMB Thousand) | 2021 (Unaudited) | 2020 (Unaudited) | | :--- | :--- | :--- | | Revenue | 107,879,151 | 88,625,398 | | Operating Profit | 31,396,439 | 31,261,975 | | Profit Before Tax | 32,528,050 | 33,373,292 | | Profit for the Period | 21,967,303 | 22,803,100 | | Profit Attributable to Shareholders of the Company | 20,778,666 | 20,526,531 | | Basic Earnings Per Share (RMB) | 1.90 | 1.87 | [Condensed Consolidated Statement of Financial Position](index=27&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2021, total assets reached **RMB 858.34 billion**, total liabilities were **RMB 517.09 billion**, and equity attributable to shareholders increased **4.4%** to **RMB 328.05 billion** from end-2020 Condensed Consolidated Statement of Financial Position Summary | Indicator (RMB Thousand) | June 30, 2021 (Unaudited) | December 31, 2020 (Audited) | | :--- | :--- | :--- | | Non-current Assets | 196,435,298 | 187,404,193 | | Current Assets | 661,905,052 | 636,253,178 | | **Total Assets** | **858,340,350** | **823,657,371** | | Current Liabilities | 312,079,317 | 303,962,200 | | Non-current Liabilities | 205,014,048 | 191,345,851 | | **Total Liabilities** | **517,093,365** | **495,308,051** | | Equity Attributable to Shareholders of the Company | 328,054,227 | 314,146,531 | | **Total Equity** | **341,246,985** | **328,349,320** | [Condensed Consolidated Statement of Cash Flows](index=31&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) In H1 2021, net cash from operating activities was **RMB 3.51 billion**, net cash used in investing activities was **RMB 3.61 billion**, and net cash from financing activities was **RMB 9.59 billion**, resulting in a net increase in cash and cash equivalents of **RMB 9.49 billion** Condensed Consolidated Statement of Cash Flows Summary (For the six months ended June 30) | Indicator (RMB Thousand) | 2021 (Unaudited) | 2020 (Unaudited) | | :--- | :--- | :--- | | Net Cash from Operating Activities | 3,511,678 | 7,056,059 | | Net Cash Used in Investing Activities | (3,607,627) | (2,780,041) | | Net Cash from Financing Activities | 9,587,578 | 13,047,286 | | Net Increase in Cash and Cash Equivalents | 9,491,629 | 17,323,304 | | Cash and Cash Equivalents at Beginning of Period | 107,664,125 | 92,894,556 | | **Cash and Cash Equivalents at End of Period** | **117,029,159** | **110,391,906** | [Notes to the Financial Statements](index=33&type=section&id=%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This section provides detailed explanations and supplementary information for the condensed consolidated financial statements, covering basis of preparation, accounting policies, segment revenue, dividends, share capital changes, and related party transactions, with property development as the primary revenue source at **97.3%** Segment Revenue (H1 2021) | Segment | Revenue (RMB Thousand) | | :--- | :--- | | Property Development | 105,011,144 | | Property Investment | 2,269,457 | | Other Businesses | 598,550 | | **Total** | **107,879,151** | - The Board declared an interim dividend of **HK 45 Cents per share** for the six months ended June 30, 2021, totaling approximately **RMB 4.10 billion**[95](index=95&type=chunk) - For the six months ended June 30, 2021, the company repurchased a total of **8.37 million shares** for a total consideration of **RMB 109 million**, which have been cancelled[103](index=103&type=chunk) [Other Information](index=53&type=section&id=%E5%85%B6%E4%BB%96) [Interim Dividend and Share Matters](index=54&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF%E5%8F%8A%E8%82%A1%E4%BB%BD%E4%BA%8B%E5%AE%9C) The Board declared an interim dividend of **HK 45 Cents per share** and announced relevant dates; the company repurchased **8.37 million shares** for approximately **HK 131 million**, while subsidiaries issued and redeemed various debt instruments - An interim dividend of **HK 45 Cents per share** was declared, with a record date of September 20, 2021[124](index=124&type=chunk)[125](index=125&type=chunk) - In January 2021, the company repurchased **8.37 million shares** on the Stock Exchange for a total consideration of approximately **HK 131 million**[126](index=126&type=chunk)[127](index=127&type=chunk) - Subsidiaries including China Overseas Property Development and Beijing COLI Plaza actively utilized capital markets for financing during and after the period, issuing various debt instruments and timely redeeming matured securities[128](index=128&type=chunk)[129](index=129&type=chunk)[130](index=130&type=chunk)[131](index=131&type=chunk) [Directors', Chief Executives' and Major Shareholders' Interests in Securities](index=58&type=section&id=%E8%91%A3%E4%BA%8B%E3%80%81%E6%9C%80%E9%AB%98%E8%A1%8C%E6%94%BF%E4%BA%BA%E5%93%A1%E5%8F%8A%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E4%B9%8B%E8%AD%89%E5%8B%99%E6%AC%8A%E7%9B%8A) This section discloses the interests of directors, chief executives, and major shareholders in company shares as of June 30, 2021, with China Overseas Holdings Limited holding approximately **51.32%** and CITIC Group related companies holding about **10.01%** of beneficial interests Major Shareholders' Shareholding (June 30, 2021) | Shareholder Name | Number of Shares Held (Beneficial Interest) | Percentage of Issued Shares (%) | | :--- | :--- | :--- | | China Overseas Holdings Limited | 5,616,813,755 | 51.32% | | China State Construction Engineering Corporation Limited | 6,138,078,683 | 56.08% | | China State Construction Group Co., Ltd. | 6,138,078,683 | 56.08% | | Complete Noble Limited | 1,095,620,154 | 10.01% | - Executive Directors Yan Jianguo, Luo Liang, Zhang Zhichao, Guo Guanghui, and Non-executive Director Zhuang Yong all hold share options granted under the share option scheme[136](index=136&type=chunk) [Share Option Scheme](index=64&type=section&id=%E8%82%A1%E4%BB%BD%E6%9C%9F%E6%AC%8A%E8%A8%88%E5%8A%83) The company adopted a ten-year share option scheme on June 11, 2018, to incentivize employees, with a maximum of **723.98 million shares** available for grant, representing **6.61%** of issued shares - The Share Option Scheme was adopted on June 11, 2018, with a ten-year validity period until June 10, 2028[146](index=146&type=chunk)[147](index=147&type=chunk) - The maximum number of share options that can be granted under the scheme is **10%** of the issued shares at the adoption date (approximately **1.096 billion shares**)[146](index=146&type=chunk) - The exercise price shall not be less than the higher of the closing price on the grant date and the average closing price for the five trading days immediately preceding the grant date[147](index=147&type=chunk) [Corporate Governance](index=66&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) The company largely complied with the Corporate Governance Code in H1 2021, with all directors confirming adherence to securities dealing codes, and the Audit and Risk Management Committee reviewing the interim report - The company complied with the Code Provisions of the Corporate Governance Code, except for Code Provision A.4.1 (non-executive directors having no specific term of office)[150](index=150&type=chunk) - All Directors confirmed compliance with the Model Code for Securities Transactions by Directors of Listed Issuers, which is no less exacting than the Standard Code, during the reporting period[151](index=151&type=chunk) - The Audit and Risk Management Committee has reviewed the unaudited interim results[152](index=152&type=chunk)

[Chairman's Report](index=8&type=section&id=%E4%B8%BB%E5%B8%AD%E5%A0%B1%E5%91%8A%E6%9B%B8) Chairman Yan Jianguo's report highlights the Group's resilient performance in H1 2020 despite the COVID-19 pandemic and global economic downturn, emphasizing social responsibility, robust financial strategies, sales growth, quality land reserves, optimized commercial assets, new business cultivation, and commitment to technological innovation [Chairman's Report](index=8&type=section&id=%E4%B8%BB%E5%B8%B8%E5%A0%B1%E5%91%8A%E6%9B%B8) Chairman Yan Jianguo's report highlights the Group's resilient performance in H1 2020 despite the COVID-19 pandemic and global economic downturn, emphasizing social responsibility, robust financial strategies, sales growth, quality land reserves, optimized commercial assets, new business cultivation, and commitment to technological innovation Key Financial Indicators for H1 2020 | Indicator | H1 2020 | Year-on-Year Change | | :--- | :--- | :--- | | Revenue (RMB) | 88.63 billion | +11.0% | | Profit Attributable to Shareholders (RMB) | 20.53 billion | -3.7% | | Core Net Profit (RMB) | 17.94 billion | +0.3% | | Net Profit Margin (%) | 23.2% | Industry Leading | | Basic Earnings Per Share (RMB) | 1.87 | - | | Interim Dividend Per Share (HKD) | 0.45 | - | - Despite the pandemic, the Group achieved contracted sales of **RMB 172.01 billion**, a **4.2% year-on-year increase**, with June's single-month sales reaching a record **RMB 57.56 billion**, up **32.3% year-on-year**[19](index=19&type=chunk) - Adhering to a prudent financial strategy, the Group held **RMB 111.38 billion** in cash at period-end, with an asset-liability ratio of **59.77%** and a net gearing ratio of **32.95%**, maintaining one of the lowest levels in the industry[19](index=19&type=chunk) - The Group continued to deepen its presence in mainstream cities and acquired large-scale projects, adding **RMB 52.28 billion** in land premium for new land interests during the period, bringing the total land reserve of the Group's series companies to **90.06 million square meters**[20](index=20&type=chunk) - Total operating revenue from commercial assets reached **RMB 2.03 billion**, a **1.1% year-on-year increase**, with asset structure continuously optimized through the sale of Chengdu projects and acquisition of Foshan projects; successful CMBS issuance at a coupon rate of **2.5%** demonstrated market recognition for quality commercial assets[21](index=21&type=chunk) - Actively cultivating new growth drivers, new supply chain management and technology companies were established to build a B2B building materials trading platform and provide technology products and services for real estate development and operations[21](index=21&type=chunk) [Management Discussion and Analysis](index=14&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E8%88%87%E5%88%86%E6%9E%90) [Overall Performance](index=14&type=section&id=%E6%95%B4%E9%AB%94%E8%A1%A8%E7%8F%BE) In H1 2020, the Group's revenue grew **11.0%** to **RMB 88.63 billion**, while profit attributable to shareholders decreased **3.7%** to **RMB 20.53 billion**, maintaining industry-leading gross and net profit margins of **30.6%** and **23.2%** respectively, with a robust financial position and a net gearing ratio of **32.95%** H1 2020 Performance Overview | Indicator | H1 2020 | H1 2019 | | :--- | :--- | :--- | | Revenue (RMB) | 88.63 billion | 79.84 billion | | Operating Profit (RMB) | 31.26 billion | 31.30 billion | | Profit Attributable to Shareholders (RMB) | 20.53 billion | 21.32 billion | | Basic Earnings Per Share (RMB) | 1.87 | 1.95 | | Net Gearing Ratio (%) | 32.95% | - | [Property Development](index=14&type=section&id=%E7%89%A9%E6%A5%AD%E7%99%BC%E5%B1%95) Property development, the Group's core revenue source, saw revenue increase **11.2%** year-on-year to **RMB 86.35 billion**, with **7.32 million square meters** of projects completed across **21** cities and **21** new land plots acquired in **13** cities totaling **5.82 million square meters**, bringing the Group's total land reserve to **90.06 million square meters** at period-end Property Development Segment Performance | Indicator | H1 2020 | Year-on-Year Change | | :--- | :--- | :--- | | Revenue (RMB) | 86.35 billion | +11.2% | | Segment Profit (RMB) | 27.39 billion | +1.9% | - During the period, the Group acquired **21** new land plots in **13** cities in mainland China, adding a total gross floor area of **5.82 million square meters** with an attributable land premium of **RMB 52.28 billion**[31](index=31&type=chunk)[32](index=32&type=chunk) - As of June 30, 2020, the total land reserve of the Group's series companies (including China Overseas Grand Oceans) reached **90.06 million square meters**[33](index=33&type=chunk) [Property Investment](index=18&type=section&id=%E7%89%A9%E6%A5%AD%E6%8A%95%E8%B3%87) Property investment business showed stable performance, with rental income increasing **6.2%** year-on-year to **RMB 1.92 billion**, and segment profit growing **10.3%**, primarily driven by a **RMB 5.20 billion** increase in fair value of investment properties Property Investment Segment Performance | Indicator | H1 2020 | Year-on-Year Change | | :--- | :--- | :--- | | Rental Income (RMB) | 1.92 billion | +6.2% | | Segment Profit (RMB) | 6.49 billion | +10.3% | [Other Businesses](index=18&type=section&id=%E5%85%B6%E4%BB%96%E6%A5%AD%E5%8B%99) During the period, other businesses generated **RMB 0.36 billion** in revenue, with hotels and other commercial properties' revenue decreasing to **RMB 0.11 billion** due to the pandemic's impact Other Business Revenue | Business Category | H1 2020 Revenue (RMB) | H1 2019 Revenue (RMB) | | :--- | :--- | :--- | | Total Other Business Revenue | 0.36 billion | 0.38 billion | | Of which: Hotels and Other Commercial Properties | 0.11 billion | 0.19 billion | [Liquidity, Financial Resources and Debt Structure](index=19&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E3%80%81%E8%B2%A1%E6%94%BF%E8%B3%87%E6%BA%90%E5%8F%8A%E5%82%B5%E5%8B%99%E7%B5%90%E6%A7%8B) The Group maintained prudent financial management with a strong financial position, holding **RMB 111.38 billion** in cash and a net gearing ratio of **32.95%** at period-end, with a weighted average borrowing cost of **4.01%**, effectively managing debt structure and exchange rate/interest rate risks through flexible domestic and international financing platforms Key Financial Ratios and Financing Costs (As of June 30, 2020) | Indicator | Value | | :--- | :--- | | Current Ratio (times) | 2.3 | | Interest Coverage Ratio (times) | 7.2 | | Weighted Average Borrowing Cost (%) | 4.01% | | Net Gearing Ratio (%) | 32.95% | - The Group successfully utilized financing tools, issuing multi-tranche senior notes totaling **USD 1 billion** and the largest domestic green CMBS, raising **RMB 3.70 billion** at a coupon rate of just **2.5%**[36](index=36&type=chunk) - As of period-end, total interest-bearing debt amounted to **RMB 208.61 billion**, with **16.0%** due within one year; bank balances and cash reached **RMB 111.38 billion**, indicating ample available funds[37](index=37&type=chunk) [Sustainable Development](index=22&type=section&id=%E5%8F%AF%E6%8C%81%E7%BA%8C%E7%99%BC%E5%B1%95) The Group integrated sustainable development into its operations, establishing the "Four Good Company" ESG strategic framework with specific 2019-2023 targets, achieving significant progress in green building, targeted poverty alleviation, and employee care during the first half, and successfully being included in the Hang Seng ESG 50 Index - The "Four Good Company" (Good Citizen, Good Product, Good Service, Good Performance) ESG strategic framework was established, along with **61** sustainable development goals[41](index=41&type=chunk)[43](index=43&type=chunk) - During the period, **21** new green building certified projects were added, covering **2.57 million square meters**; cumulative certified projects reached **315**, totaling **58.04 million square meters**[41](index=41&type=chunk)[47](index=47&type=chunk) - The "Haihui Wanjia" targeted poverty alleviation initiative continued, establishing the "Kangle Mushroom" brand in Kangle County, Gansu, to help open up sales channels[41](index=41&type=chunk)[45](index=45&type=chunk) - As of period-end, the Group employed over **6,100** staff, launched the MAPS job grade system to broaden employee career development paths, and conducted multiple series of online training programs[42](index=42&type=chunk) [Financial Statements](index=29&type=section&id=%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Condensed Consolidated Statement of Profit or Loss](index=29&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2020, the Group achieved revenue of **RMB 88.63 billion**, operating profit of **RMB 31.26 billion**, profit for the period of **RMB 22.80 billion**, and profit attributable to owners of the Company of **RMB 20.53 billion** H1 2020 Statement of Profit or Loss Key Data | Item | Amount (RMB thousands) | | :--- | :--- | | Revenue | 88,625,398 | | Operating Profit | 31,261,975 | | Profit Before Tax | 33,373,292 | | Profit for the Period | 22,803,100 | | Profit Attributable to Owners of the Company | 20,526,531 | [Condensed Consolidated Statement of Financial Position](index=31&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2020, the Group's total assets were **RMB 764.00 billion**, total liabilities were **RMB 456.64 billion**, and equity attributable to owners of the Company was **RMB 295.09 billion**, representing a **5.2%** increase from the end of 2019 Statement of Financial Position Key Data (As of June 30, 2020) | Item | Amount (RMB thousands) | | :--- | :--- | | Total Assets (Non-current + Current) | 764,001,315 | | Total Liabilities (Non-current + Current) | 456,636,792 | | Equity Attributable to Owners of the Company | 295,085,932 | | Total Equity | 307,364,523 | [Condensed Consolidated Statement of Cash Flows](index=35&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) For the six months ended June 30, 2020, net cash inflow from operating activities was **RMB 7.06 billion**, net cash outflow from investing activities was **RMB 2.78 billion**, net cash inflow from financing activities was **RMB 13.05 billion**, and cash and cash equivalents increased to **RMB 110.39 billion** at period-end H1 2020 Cash Flow Overview | Item | Amount (RMB thousands) | | :--- | :--- | | Net Cash from Operating Activities | 7,056,059 | | Net Cash Used in Investing Activities | (2,780,041) | | Net Cash from Financing Activities | 13,047,286 | | Net Increase in Cash and Cash Equivalents | 17,323,304 | | Cash and Cash Equivalents at End of Period | 110,391,906 | [Notes to the Financial Statements](index=37&type=section&id=%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This section of notes details the basis of financial statement preparation, application of accounting policies, segment information, dividends, debt, related party transactions, and other key financial information and calculation methods [Note 5: Revenue and Segment Contribution](index=40&type=section&id=5.%20%E6%94%B6%E5%85%A5%E5%8F%8A%E6%A5%AD%E7%B8%BE%E8%B2%A2%E7%8D%BB) The Group's businesses are primarily divided into property development, property investment, and other businesses, with property development contributing the vast majority of revenue and profit in H1 2020, accounting for **97.4%** of total revenue H1 2020 Segment Revenue and Profit | Segment | Revenue (RMB thousands) | Profit (RMB thousands) | | :--- | :--- | :--- | | Property Development | 86,345,664 | 27,386,299 | | Property Investment | 1,922,976 | 6,493,906 | | Other Businesses | 356,758 | 5,232 | | **Total** | **88,625,398** | **33,885,437** | [Note 10: Dividends](index=47&type=section&id=10.%20%E8%82%A1%E6%81%AF) The Board declared an interim dividend of **HKD 0.45** per share for 2020, consistent with the prior year, which has not been recognized as a liability in these interim financial statements - The Board declared an interim dividend of **HKD 0.45** per share for 2020 (H1 2019: **HKD 0.45** per share)[80](index=80&type=chunk) [Note 14: Bills Payable Due After One Year](index=52&type=section&id=14.%20%E4%B8%80%E5%B9%B4%E5%BE%8C%E5%88%B0%E6%9C%9F%E4%B9%8B%E6%87%89%E4%BB%98%E7%A5%A8%E6%93%9A) For the six months ended June 30, 2020, the Group newly issued three tranches of USD senior notes and one RMB commercial mortgage-backed security (CMBS) to optimize its debt structure H1 2020 Newly Issued Notes | Issue Date | Principal | Annual Interest Rate (%) | Maturity Date | | :--- | :--- | :--- | :--- | | March 2, 2020 | USD 300 million | 2.375% | March 2, 2025 | | March 2, 2020 | USD 500 million | 2.75% | March 2, 2030 | | March 2, 2020 | USD 200 million | 3.125% | March 2, 2035 | | April 28, 2020 | RMB 3.7 billion | 2.5% | April 28, 2038 | [Other Information](index=57&type=section&id=%E5%85%B6%E4%BB%96) [Purchases, Sales or Redemptions of the Group's Listed Securities](index=57&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B4%96%E5%9B%9E%E6%9C%AC%E9%9B%86%E5%9C%98%E4%B9%8B%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) During the period, the Company repurchased and cancelled **416,500** shares in June 2020, while subsidiaries issued multiple green asset-backed securities and housing rental special corporate bonds to raise funds for debt repayment and project construction - In June 2020, the Company repurchased **416,500** shares on the Stock Exchange for a total consideration of approximately **HKD 9.94 million**[104](index=104&type=chunk)[105](index=105&type=chunk) - Subsidiaries issued two tranches of green asset-backed special schemes, raising approximately **RMB 6.7 billion** in total, and issued **RMB 2 billion** in housing rental special corporate bonds[106](index=106&type=chunk) [Interests of Major Shareholders in Securities](index=63&type=section&id=%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E4%B9%8B%E8%AD%89%E5%88%B8%E6%AC%8A%E7%9B%8A) As of June 30, 2020, the Company's major shareholder was China State Construction Engineering Corporation (CSCEC), indirectly holding approximately **55.99%** of the Company's shares through its subsidiaries, with China CITIC Group Corporation being another major shareholder, indirectly holding approximately **10.00%** of the shares Major Shareholder Holdings (As of June 30, 2020) | Shareholder Name | Shareholding Percentage (Long Position) (%) | Capacity | | :--- | :--- | :--- | | China State Construction Engineering Corporation (CSCEC) | 55.99% | Interest in Controlled Corporation | | China CITIC Group Corporation | 10.00% | Interest in Controlled Corporation | [Share Option Scheme](index=64&type=section&id=%E8%82%A1%E4%BB%BD%E6%9C%9F%E6%AC%8A%E8%A8%88%E5%8A%83) The Company adopted a share option scheme in June 2018, under which **4,030,000** options had lapsed and **32,746,000** options had vested as of June 30, 2020, with no new options granted, exercised, or cancelled during the period - The Share Option Scheme was adopted on **June 11, 2018**, with a **ten-year** validity, aiming to incentivize and retain talent[123](index=123&type=chunk) - During the reporting period, **4,030,000** share options lapsed and **32,746,000** share options vested, with no share options granted, exercised, or cancelled during the period[125](index=125&type=chunk) [Corporate Governance](index=68&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) The Company complied with all code provisions of the Corporate Governance Code during the reporting period, with the sole exception of Code Provision A.4.1 regarding the appointment terms of non-executive directors, where the Company adopts a system of rotation and re-election instead of fixed terms - The Company complied with most provisions of the Corporate Governance Code, except for Code Provision A.4.1; the Company's non-executive directors do not have a specific term of appointment but are subject to retirement by rotation and re-election in accordance with the Company's articles of association[129](index=129&type=chunk)