China Everbright Limited Announces 2017 Interim Results

Aug 30, 2017 20:57 JST

Source: China Everbright Ltd

Profit of direct operating businesses increased by 73% to HK$987 million

HONG KONG, Aug 30, 2017 - (ACN Newswire) - China Everbright Limited ("CEL" or "the Group", stock code: 165.HK) today announced its interim results for the six months ended 30 June 2017.

China Everbright Limited announces 2017 interim results. From left, Mr Richard Tang, Executive Director & Chief Financial Officer; Mr Chen Shuang, Executive Director & Chief Executive Officer; and Mr Frederick Tsang, Chief Risk Officer.

In the first half of 2017, CEL's direct operating businesses (fund management and principal investment) posted a profit of HK$987 million, up 73% year on year. Profit contribution from Everbright Securities dropped 34% to HK$346 million. China Everbright Bank contributed a dividend income after tax of HK$157 million, down 50% compared to the same period last year. Profit attributable to CEL's equity shareholders amounted to HK$1.49 billion, representing a year-on-year increase of 5.6%.

Gradual improvements in standards and regulations for China's financial market systems helped CEL achieve breakthroughs in fundraising scale and project investment size, among other aspects. The Group's total fundraising scale broke the HK$100 billion mark, growing 22% from the end of 2016 to reach HK$106.6 billion.

During the reporting period, CEL and China Merchants Bank jointly set up the RMB 5 billion Everbright-CMB Multi-strategy Equity Investment Fund. The cooperative venture brings together CEL's diverse fund platforms and China Merchants Bank's strong capital resources and asset management experience.

CEL is committed to an investment philosophy focusing on the integration of industry and finance and growing industry capital. During the reporting period, CEL acquired an equity interest in Shanghai Jiabao (SH: 600622) by raising its stake in the company to 24.33%, and the Group remained the single largest shareholder of China Aircraft Leasing Group Holdings Limited ("CALC").

The Board of Directors has resolved to declare an interim dividend of HK$0.25 per share for the six months ended 30 June 2017 (1H 2016: HK$0.25 per share), same as the interim dividend of last year.

Business Review

Fund Management Business

As at 30 June 2017, CEL's fund management business had broken the HK$100 billion fundraising mark to reach HK$106.6 billion, up 22% from the end of 2016 and marking a new stage of development for the segment. Of the total amount raised, external funds accounted for 78%. CEL currently manages 38 funds with 96 post-investment management projects.

CEL is currently among China's top private equity firms in the primary market. Investors include joint-stock commercial banks, corporations, investment companies, trusts and asset managers, providing increasingly solid and diversified sources of funding. During the reporting period, CEL secured investments from iQIYI, NextEV, Mi-Me and leading companies in other fields, venturing into mobile video, new energy cars, online payment and other sectors. It also helped MLS complete the cross-border acquisition of Germany-based OSRAM's lighting business and assisted IDG Capital in the acquisition of International Data Group (IDG), a US-based media company.

As at 30 June 2017, CEL Secondary Market managed a total of 16 funds and accounts with AUM of HK$12.4 billion, up 15% from last year.

During the period under review, EBA Investments focused on post-investment management with continued efforts to upgrade, transform, develop and operate its holding properties (including but not limited to commercial malls, office buildings, park properties and others) to boost rental income and enhance the value of its assets. As an asset manager, EBA Investments exports its "IMIX" brand and charges management fees. As at June 2017, EBA managed over 800,000 square metres of commercial property under IMIX, covering several tier-one and tier-two cities in China.

New Energy Funds and Medical and Healthcare Fund contributed to the listing of Hengrun Heavy Industries on the Shanghai Stock Exchange and BGI Genomics on the Shenzhen Stock Exchange. During the reporting period, the Group divested projects through M&A and bulk transactions.

Principal Investment Business

CEL focuses its capital resources on four areas of deployment, providing strategic differentiation for the Group's business development. As at 30 June 2017, CEL's principal investment business was valued at HK$22.7 billion. The Group posted pre-tax profit of HK$1,193 million, representing an 89% increase year on year.

As at July 2017, CEL had issued onshore panda bonds totalling RMB 10.5 billion, bringing long-term and low-cost capital to the Group while optimising the asset-liability structure of USD and RMB.

During the reporting period, CEL remained the single largest shareholder of CALC, holding a 33.6% equity interest and sharing in a HK$84 million profit contribution. The Group employed systematic industry-finance integration to help CALC acquire 100% of Universal Asset Management ("UAM"), a world-leading provider of global aviation solutions. The Group also helped CALC complete an agreement to purchase 50 new Boeing 737 MAX airplanes, contributing to the sale of finance lease receivables as part of its recurrent business. These efforts have contributed to CALC's on-going transformation from a leading aircraft leasing company in China to an important participant in the global aviation industry value chain.

Other Development Highlights

In the first half of 2017, CEL won a host of market accolades, including 'The Most Competitive Venture Capital Firm' and 'Best Exit Case' at the 2017 China Venture Capital Golden Eagle Awards, where Chief Executive Officer Mr Chen Shuang was also named 'Outstanding Venture Capitalist'. In addition, EBA Investments topped the 'Top 10 Chinese Real Estate Funds' for the third consecutive year, and EBA Investments' IMIX brand was named one of the 'Top 10 brands of China Commercial Real Estate Companies in 2016'.

Strategy and Outlook

The Group said there will be general signs of growing optimism in the financial market in the second half of 2017, but added that a host of uncertainties may impact asset prices. These include effects on global liquidity resulting from the Federal Reserve's tapering move to raise interest rates; the European Central Bank's probable announcement to cut back on its QE programme; pressure faced by the Bank of Japan to tighten monetary policy; and the potential drag on asset prices caused by China's monetary and credit tightening.

Mr Chen Shuang, Executive Director and Chief Executive Officer of China Everbright Limited, said, "These macroeconomic uncertainties will continue to drive demand for asset management expertise and the trend toward differentiation that is already underway in the industry. Quality asset managers with proven track records and strong integrated capabilities stand to benefit from the growing opportunities accorded by these developments. As a leading asset management and investment company, CEL will focus on expanding the coverage of its fund products while striving to build a closed-loop ecosystem by developing its full-value-chain capabilities in sectors where it is committed to building a deep presence. At the same time, the Group will work to strengthen its platform, building an unsurpassed suite of core competences and growing its fund management business."

The Group, which is celebrating its 20th anniversary this year, also said it will continue to advance its "Global Vision, China Insight, Hong Kong Base" proposition to generate sustainable growth for shareholders and investors.

The announcement of the interim results for the six months ended 30 June 2017 is available on the Company's official website: www.everbright.com.

About China Everbright Limited
China Everbright Limited (CEL, stock code: 165.HK) was established in Hong Kong in 1997 and is China's leading cross-border investment and asset management company. Its parent company is China Everbright Group. CEL manages private equity funds, venture capital funds, industry funds, mezzanine funds, parent funds, fixed income and equity funds. The bank utilises strong private capital and cultivates a number of high-growth-potential enterprises together with its investors. While closely following the development requirements of Chinese companies, it also seamlessly merges the best in overseas technologies with the Chinese market, providing multi-faceted service to Chinese clients involved in overseas investment.

As at the end of June 2017, CEL managed 38 funds and completed fundraising efforts in the amount of HKD 106.6 billion. Through both proprietary funds and the funds it manages, CEL has invested in companies both in China and globally, including China UMS, GDS, Goldwind, CECEP Wind-power Corporation, Nanjing Gaosu Chuandong, HC SemiTek, Beijing Genomics Institute, Betta Pharmaceuticals Co., Ltd., Beingmate, Focus Media, iQiYi, Miaopai, Albania Capital Airport, Wish and BEP. It has invested in a total of over 300 companies, covering fields including real estate, pharmaceuticals, new energy, infrastructure, advanced technology, high-level manufacturing, financial technology and cultural consumption. Of these, more than 150 companies have been listed in China or overseas, or were listed but have since withdrawn due to mergers and acquisitions.

CEL is the second-largest shareholder of Everbright Securities (stock code: 601788.SH, 6178.HK) and a strategic shareholder of China Everbright Bank (stock code: 601818.SH, 6818.HK). It is also the largest shareholder of Shanghai Jiabao Industry & Commerce Limited (stock code: 600622.SH). On the Hong Kong listing, it is the largest shareholder of China Aircraft Leasing Group Holdings Limited (stock code: 1848.HK). On the Singapore listing, it is the second-largest shareholder of Ying Li International Real Estate Limited (stock code: 5DM. SGX). CEL and its subsidiary companies currently have offices in Hong Kong, Beijing, Shanghai, Shenzhen, Tianjin, Singapore and Dublin.

CEL became one of the first Hong Kong stocks to be traded following the launches of the Shanghai-Hong Kong and Shenzhen-Hong Kong Stock Connect programmes in April 2014 and December 2016.

CEL adheres to the motto "The Power to Transform". With a firm footing in Hong Kong - a true bridge between east and west - the Group is well positioned to take advantage of the long-term opportunities presented by changes in the Chinese market, respond flexibly, and become a leader in Chinese cross-border investment and asset management.

For more information, please visit www.everbright.com.

For enquiries, please contact:
Golin
Rebecca Sham
Tel: +852 2501 7987
Email: rsham@golin.com

Tracy Cheung
Tel: +852 2501 7902
Email: tcheung@golin.com

Source: China Everbright Ltd
Sectors: Daily Finance, Daily News, Funds & Equities