Monday, August 8, 2022
Martin Hennecke
HKEx Stock Code : 00021 
Corporate Profile
The principal activities are property development and investment, investment holding and security investment.

Business Review - For the year ended December 31, 2012

Property Development and Investment Business

The Gold Coast Project

The Company, through its indirect wholly-owned PRC subsidiary, owns a resort located in Baian Peninsula, Houmen Town, Haifeng County, Shanwei City, Guangdong Province, the PRC (the “Gold Coast Resort”).

After the expiry of the tenancy agreement dated 10 October 2008 and two supplemental tenancy agreements dated 29 December 2008 and 9 March 2009 with an independent third party, the Group has entered into an agreement dated 29 March 2012 to extend the leasing period of Gold Coast Resort for a term of two years commencing from 1 April 2012 with a fixed monthly rental income of RMB800,000.

On 16 August 2012, 海豐金麗灣度假村有限公司 (Haifeng Jinliwan Resort CompanyLimited*) (“Gold Coast PRC”) received confirmation that it was successful in a bid in the open tender of the land use right to the two pieces of land situated at 中國廣東省汕尾市海豐縣(魚后)門鎮百安村委 (Baian Village, Houmen Town, Haifeng County, Shanwei City,Guangdong Province, the PRC*) with an aggregate area of approximately 97,069 square meters (the “Land”, consisting of two sites, site “A” with an area of approximately 55,130 square meters and site “B” with an area of approximately 41,939 square meters) held by 海豐縣土地交易所 (Haifeng County Land Exchange*) (the “Land Exchange”) between 27 July2012 and 15 August 2012, to acquire the land use right of the Land at an aggregate consideration of RMB54.359 million (equivalent to approximately HK$68,269,000).

Following the successful bidding for the land use right of the Land, Gold Coast PRC entered into two confirmation letters with the Land Exchange on 16 August 2012 to confirm the successful bid for the Land and the related payment terms for the transfer of land use right of the Land.

Gold Coast PRC has entered into two land use right transfer contracts (the “Land Use Right Transfer Contracts”) with 海豐縣國土資源局 (Haifeng County Land Resources Bureau*) on16 August 2012 which require Gold Coast PRC to ensure that the development of the Land is in accordance with the relevant PRC rules and regulations and that such development commences within 2 years from the date of the Land Use Right Transfer Contracts. In the event that development on the Land has not commenced after a period of 2 years from the date of the Land Use Right Transfer Contracts, the land use right of the Land will be revoked.

Gold Coast PRC has also entered into two state-owned construction land use right grant contracts with Haifeng County Land Resources Bureau on 27 August 2012 which confirmed that the land use right of the Land has been granted for a term of 40 years for commercial use and 70 years for residential use.

The Group intends to expand the development of the Gold Coast Resort on the Land which is near to the Gold Coast Resort.

The Gold Coast PRC has completed the construction of water supply pipes connecting 魚后門鎮(Houmen Town*) and 梅隴鎮平安洞 (Meilong Town Pinandong*) in March 2010 with a totalcost of approximately HK$6,837,000 to address water supply and shortage problems in the 魚后門鎮 (Houmen Town*) area where the Gold Coast Resort is located. Extension of theoperation of the water supply pipes to supply water to the local villages near the Gold Coast Resort will be considered when business opportunity arises.

Gold Coast PRC had entered into a construction contract dated 16 June 2010 and two supplemental agreements dated 10 December 2010 and 13 January 2011, respectively, with an independent third party, 深圳市焯楠建築裝飾工程有限公司 (Shenzhen Zhuonan Constructionand Decoration Company Limited*) (the “Constructor”), for the construction and renovation of the Gold Coast Resort at a contract price of RMB55,000,000 (equivalent to approximately HK$69,075,000). As at the date of this announcement, the Gold Coast PRC paid approximately RMB30,976,000 (equivalent to approximately HK$38,903,000) to the Constructor as a prepayment of the contract sum. As the design for the construction and renovation of the Gold Coast Resort is still under modification, the commencement date of the renovation works is still not yet fixed.

The Tanghai County Project

The Group entered into a sale and purchase agreement dated 27 September 2010 (the “Tanghai Acquisition Agreement”) with independent third parties in relation to the acquisition of 99.99% equity interest of 唐海中泰信和房地產開發有限公司 (Tanghai Zhongtai Xinhe RealEstate Company Limited*) (“Tanghai Zhongtai Xinhe”) (the “Tanghai Acquisition”), further details of the Tanghai Acquisition are set out in the Company's circular dated 25 November 2010.

The Tanghai Acquisition was approved by the shareholders at the extraordinary general meeting of the Company held on 13 December 2010. All conditions precedent to the Tanghai Acquisition Agreement have been satisfied and completion of Tanghai Acquisition took place on 25 January 2013. Following the completion, Tanghai Zhongtai Xinhe has become an indirect subsidiary of the Company and the financial results of Tanghai Zhongtai Xinhe will be consolidated into the financial statements of the Group.

The Group has paid a total sum of approximately RMB92,500,000 (equivalent to approximately HK$116,171,000) as consideration of the Tanghai Acquisition. The vendors of Tanghai Zhougtai Xinhe are subject to pay the PRC individual income tax derived from the transfer of the equity interest of Tanghai Zhongtai Xinhe. As at the date of completion of the Tanghai Acquisition, such PRC individual income tax had not been settled. It was agreed by the vendors that they will not require the Company to pay the remaining portion of the consideration of RMB11,989,550 (equivalent to approximately HK$15,058,000) until the outstanding PRC individual income tax is settled by them.

The Group has appointed several external firms to conduct reconnaissance and began designing work. As at the date of this announcement, the Group is at the preliminary stage to plan and design the ecological leisure living area or resort area.

The Daya Bay Project

On 8 June 2012, Asiatic Talent Limited (“Asiatic”), a wholly-owned subsidiary of the Company, entered into a sale and purchase agreement (the “Sale and Purchase Agreement”) with Mr. Huang Shih Tsai (“Mr. Huang”), the non-executive director and the chairman of the Company, pursuant to which Asiatic has conditionally agreed to acquire and Mr. Huang has conditionally agreed to sell the entire issued share capital of Guo Rong Limited (“Guo Rong”) at a consideration of RMB230,000,000 (subject to downward adjustments, if any) (equivalent to approximately HK$282,900,000 and subject to corresponding downward adjustments, if any) (the “Daya Bay Acquisition”).

The core assets under the Daya Bay Acquisition was 東方新天地大廈 (Great China EasternNew World Square*) (the “Property”), which is a comprehensive property development project with a total gross floor area of approximately 69,171.7 sq.m. located at No.1 Zhongxing Zhong Road, Aotou Town, Daya Bay, Huizhou City, Guangdong Province, the PRC.

The Daya Bay Acquisition constituted a very substantial acquisition and a connected transaction for the Company under the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”). Accordingly, the Daya Bay Acquisition was subject to the reporting, announcement and the independent shareholders' approval requirements set out in the Listing Rules. The Daya Bay Acquisition was approved by independent shareholders at the extraordinary general meeting held by the Company on 20 August 2012. All conditions precedent under the Sale and Purchase Agreement have been satisfied and completion of the Daya Bay Acquisition took place on 14 December 2012.

Following the completion, Guo Rong has become an indirect subsidiary of the Company and the financial results of Guo Rong and its subsidiaries were consolidated into the financial statements of the Group.

The Company had paid a sum of HK$5,000,000 in cash as refundable deposit to Mr. Huang upon the signing of the Sale and Purchase Agreement. A total of 403,203,504 consideration shares were issued at the issue price of HK$0.20 per share (fair value of which at the date of issue was HK$0.28 per share) as partial consideration (being a sum of HK$80,640,701) to Mr. Huang upon completion of the Daya Bay Acquisition.

Pursuant to the Sale and Purchase Agreement, the consideration is subject to downward adjustment, details of which are set out in the Company's circular dated 25 July 2012. The downward adjustment resulted in an amount of approximately HK$6,276,000 which Mr. Huang would repay (without interest) in cash to Asiatic within 30 days of receipt of the adjustment notice issued by Asiatic.

Revenues which are expected to be derived from the Property include (i) leasing of the commercial portion; (ii) leasing of basement car park area; and (iii) selling of the residential portion. The selling of the residential portion of the Property is expected to commence in the second quarter of 2013.

Business Outlook - For the year ended December 31, 2012

Despite the near-term uncertainties clouding the development of the PRC property market, the Group believes positives such as the mild recovery of the macro economy, sustained urbanization and increase in wealth in the PRC remain intact, and will underpin the future development of the property market.

In line with its business and future strategic focus on mid- to high-end commercial and tourism property development and investment, the Group officially changed its name to “Great China Properties Holdings Limited”, and will strive to seek to capture opportunities in the PRC property market by leveraging on its new corporate image. Looking into 2013, while opening its Great China Eastern New World Square in Huizhou City of Guangdong Province for sale in the second quarter of this year, the Group will continue to develop the Gold Coast Resort and Tanghai Project into world-class tourist destinations.

Riding on its solid foundation of existing projects, the Group remains on the lookout for high quality and cost effective investment opportunities to enhance investment returns, as well as to gradually diversify its income source. The Group will stay focused on building its quality brand name and optimizing cost control, so as to enhance its overall economy of scale and economic efficiency and become a leading commercial property developer in the PRC.

Source: Great Chi Ppt (00021) Annual Results Announcement
Chairman Huang Shih Tsai Issued Capital (shares) 1,766M
Par Value HKD 0.01 Market Capitalisation (HKD) 653M
Register  Forget Password
Advanced Search
© 2022 The Standard, The Standard Newspapers Publishing Ltd.
Home | Business | Metro | Focus | Opinion | Markets | World | Sports | Entertainment | Monday Money | Property | Macau | Weekend