News & Media
SOHO China Announces 2018 Annual Results
- Turnover of approximately RMB 1.721 billion, Net profit of approximately RMB 1.925 billion, Rental income of approximately RMB 1.735 billion, up 4% YoY, Rental income from retained projects up approximately 18% YoY.
- Valuation gains on investment properties were approximately RMB 1.093 billion, with investment property portfolio occupancy reaching 96%.
- Net gearing was 43%, with average borrowing cost 4.6%, and foreign debt accounted for approximately 3.5% of total debt.
- Co-working office business SOHO 3Q has expanded beyond Beijing and Shanghai to include other cities and third party properties. At present there are 31 centers with over 30,000 seats in seven Chinese cities.
- The Board recommended a declaration of a final dividend of RMB 0.03 in the form of cash per share for the year ended 31 December 2018.
(2019, March 29, Hong Kong) SOHO China Ltd. (hereafter referred to as “SOHO China” or the “Company”, Stock Code: HK410) announces today the Company’s 2018 audited annual results. In 2018, SOHO China achieved turnover of RMB 1.721 billion, with net profit of RMB 1.926 billion; rental income of RMB 1.735 billion with rental income of investment properties up approximately 18% year over year (excluding the effect of the 2017 disposals of Hongkou SOHO and Sky SOHO), and investment properties reached an average occupancy of approximately 96%. Net gearing was 43% and the average borrowing cost was 4.6%, with foreign debt accounting for 3.5% of total debt. Co-working office SOHO 3Q expanded to seven cities with 31 co-working centers, and over 30,000 seats. The Board recommended a declaration of a final dividend of RMB 0.03 in the form of cash per share for the year ended 31 December 2018.
As an operator of office buildings, SOHO China has approximately 1.4 million square meters of grade A office properties in prime locations of Beijing and Shanghai. Average Occupancy reached 96% and rental income was approximately RMB 1.735 billion. Rental income from retained projects up 18% year over year (excluding the effect of the 2017 disposals of Hongkou SOHO and Sky SOHO). Valuation gains on investment properties reached RMB 1.093 billion. In January 2019, Gubei SOHO, located in Shanghai’s Gubei international business district, completed construction and came into the market, and is now in the rental phase. Leeza SOHO, located at the core of Beijing’s Lize financial district is slated for completion in July this year. These two projects greatly increase the lettable area, and elevate the caliber, of the Company’s investment property portfolio. The Company’s co-working office product SOHO 3Q is steadily growing, and is now in seven cities including Beijing, Shanghai, Hangzhou and Nanjing, with 31 centers in operation, and over 30,000 seats. Mature centers have an average occupancy of 87%.
In recent years, SOHO China has established an open and transparent business management platform that includes an engineering and construction management platform, bidding and purchasing platform, equipment and facilities management platform, and other platforms that consistently improve the efficiency and service quality of our asset management and property management. To create a trustworthy rental environment, the Company introduced and open auction format for rental properties in 2018. This format ensures that property data is truthful and reliable, and bidding is open and transparent. As of this March, SOHO China has held 61 public bidding auctions for rental properties, and has auctioned 112 rental units, with a total area of 53,700 square meters. With the use of platform management, the Company has realized great improvements in rental operations and property management and maintenance. Rental rates have also increased significantly.
Since entering the mobile Internet age, people’s demand for office is consistently evolving, with the most urgent demands being related to the communications environment, bandwidth quality and phone signal. In the beginning of 2019, SOHO China along with China Mobile, China Unicom and other major mobile services providers signed strategic partnership agreements. In 2019, SOHO China will ensure all of its Beijing properties have installed 5G coverage to provide tenants with the most convenient and efficient information and technology services.
SOHO China Chairman Pan Shiyi says, “In 2019, the factors propelling China’s high speed growth have not disappeared. The railroad network, the highway network, as well as the Internet, have allowed China to become the world’s most efficient country. Therefore we continue to be confident about China’s economic growth. Today Beijing and Shanghai are two megacities that act as a magnet for massive amounts of capital, talent, and all kinds or resources. So many resources in one place are a like nuclear fusion releasing massive and immeasurable energy. Assuming this trend, we have focused our SOHO China property development in Beijing and Shanghai, and the value of these assets will continue to appreciate.”
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