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- Profit attributable to equity shareholders up 101% to HK$5.14 billion;
- Group seizes business opportunities by strengthening domestic fundraising capability and overseas investments |
HONG KONG, Mar 23, 2016 - (ACN Newswire) - China Everbright Limited ("CEL" or "the Group", stock code: 165.HK) today announced its audited annual results for the year ended 31 December 2015.
 | | (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 2015, CEL conducted a thorough review and optimisation of its existing business systems and management structure, dividing its core Direct Operating Business (formerly known as the "Hong Kong Business") into Fund Management and Principal Investment. The Fund Management Business has been making an increasingly solid contribution from its fee income, while the Principal Investment Business remains a key driver of the Group's growth across various segments.
During the reporting period, CEL posted an operating income of HK$2.13 billion, up 26% compared with the same period last year, and profit attributable to equity shareholders was HK$5.14 billion, an increase of 101% compared with the same period last year. Earnings per share was HK$3.052, representing an increase of 102%.
Although the net fair value increased by HK$3.3 billion among the Group's available-for-sale securities (excluded investment in China Everbright Bank), the notice announced by the China Securities Regulatory Commission on restricting stock sale by major shareholders, postponed a number of CEL's divestment planned for 2015, which was also one of the major reasons causing the after-tax profit of Direct Operating Business declined 67% to HK$450 million.
CEL's share of Everbright Securities' profit contribution amounted to HK$3.04 billion, representing an increase of 249%; and China Everbright Bank contributed a dividend income after tax of HK$330 million, up 3.1%. Everbright Securities completed its private placement on September 2015, and the Group recorded a net gain on deemed disposal of interest in associates of HK$1.32 billion.
The Board has resolved to recommend a final dividend of HK$0.50 per share for the year ended 31 December 2015 (2014: HK$0.33 per share). Together with the interim dividend of HK$0.25 per share, the full-year dividend for 2015 is HK$0.75 per share (2014: HK$0.48 per share), an increase of 56.3% compared to the same period last year.
Business Review
China Everbright Group, CEL's parent company, entered the Fortune Global 500 list for the first time following its restructuring, revealing increasing recognition from the international community. China Everbright Group's steady growth has also laid a solid foundation for CEL's development. In December 2015, CEL was given credit ratings of "Baa2" and "BBB" by Moody's and Fitch Group, respectively, representing the first time it has received investment-grade ratings from international independent credit rating agencies. It is expected that this will place CEL in an even stronger position to capitalise on the substantial business opportunities presented by the accelerated flows of domestic and foreign capital in and out of China.
Fund Management Business
CEL's Fund Management business includes Primary Market Funds, Secondary Market Funds, Mezzanine Funds, Multi-strategy Alternative Investment Fund (FoF Fund) and Everbright Prestige Capital Asset Management Company, providing investors from Asia-Pacific, Europe and the US with diversified services.
As at 31 December 2015, the Group's Fund Management business actively managed 31 funds (excluding non-actively managed funds raised through different channels for other external institutions). It had a total of 71 post-investment management projects, of which 14 were listed on various stock markets across the globe. The total fundraising scale was HK$49.0 billion - a decrease of 2.6% compared to 31 December 2014 - with external funds accounting for around 79%.
During the reporting period, affected by the postponed divestment aforementioned, pre-tax profit of the Fund Management business was HK$1.09 billion, representing a decrease of 11.4%. The income from the Fund Management business was HK$1.64 billion, down 2.4% from the same period last year. Of the total income, fund management and performance fees accounted for HK$250 million, 47.1% higher than the same period last year.
In December 2015, CEL co-invested RMB1.25 billion with external investors to establish its first multi-strategy alternative investment fund (FoF Fund). The committed scale for the initial phase of the fund was RMB5 billion. FoF Fund focuses on investing in CEL's primary market funds as well as leading private equity funds across a number of industries that maintain good working relationships with CEL and are well regarded for having solid market reputations and proven track records.
The Group's overseas investment business made significant progress in 2015. During the reporting period, CEL completed the acquisition of Burke E. Porter Machinery Company, a manufacturer of automobile testing tools in the US, and three extended tuck-in strategic acquisitions. This was followed by the acquisition of Lapmaster Group Holdings, LLC, a developer and manufacturer of highly engineered precision surface finishing equipment and consumables. CEL also expanded its sector coverage by investing as a limited partner in Haiyin Fund, which owns a large number of overseas innovative high-tech investment projects. It also developed plans to acquire European infrastructure projects with positive long-term operational track records; continued building a pipeline of quality projects to establish overseas infrastructure funds. Mature teams such as the Primary Market Funds' Medical and Healthcare Funds as well as Real Estate Fund also began expanding into overseas investment businesses.
Principal Investment Business
CEL is committed to developing its cross-border fund management business. The Group devotes considerable effort to external fundraising while also optimising the use of its own capital through various investment methods, using equity, bonds and derivatives to support its fund management business.
Revenue for Principal Investment amounted to HK$880 million, an increase of 33% compared to the same period last year. Interest income amounted to HK$520 million, up 58% compared to the same period last year, and dividend income increased substantially to HK$390 million. Pre-tax profit of Principal Investment amounted to HK$300 million.
CEL holds a 35.6% stake in China Aircraft Leasing Group Holdings Limited (CALC). During the reporting period, and based on equity accounting, CEL's share of CALC's after-tax profit amounted to HK$140 million, representing an increase of 17% compared to the same period last year. In 2015, CALC delivered 19 aircraft to bring its fleet size to 63. CALC also commenced construction work on an aircraft disassembly project occupying a 300,000m2 site in Harbin to establish a service chain covering the entire aircraft life cycle.
Strategy and Outlook
While 2016 will be a year of challenges, the trends of RMB internationalisation and Chinese capital "going global" are expected to remain unchanged. CEL said it anticipates seeing more business opportunities based on its commitment to cross-border asset management.
Going forward, CEL will aim to capture investment opportunities from the "going global" trend, maintain strong post-investment management for its overseas assets and projects, and accelerate the establishment of a global M&A fund. CEL will further expand fundraising and development channels in mainland China, and seek opportunities to cooperate with sister companies in China Everbright Group to strengthen the sales team on the Mainland and further enhance its fundraising capability. In addition, CEL will reinitiate the procedures for exiting a number of investment projects in order to divest from some of its matured projects in a lawful, transparent and orderly manner.
Chen Shuang, Executive Director and Chief Executive Officer of China Everbright Limited, said, "Mainland China will remain the key market for CEL in its quest for funds and partners. CEL will leverage the growing demand among major institutions in mainland China for larger allocations of quality USD assets in overseas markets to further expand its product line, target overseas assets and bolster its product portfolio. This will help create a cross-border investment and asset management platform underlined by leading core competencies, one that is capable of generating strong growth, high returns and steady incomes."
The announcement of the annual results ended 31 December 2015 is available on the Company's official website ( www.everbright165.com ) for reference.
About China Everbright Limited
China Everbright Limited ("CEL", stock code: 165.HK) was established at Hong Kong in 1997, CEL persistently pursues its "Macro Asset Management" strategy, with specific focuses on cross-border asset management and investment business. Over the past years, CEL manages series of private equity funds, venture capital funds, sector focus funds, mezzanine funds, hedge funds and principal investment as operated via an international management platform, and provides overseas investors with opportunities to explore and invest in companies with fast growing potential in Mainland China. On the other hand, CEL also seeks investment opportunities from overseas and provides diversified financial services for its clients in Mainland China.
China Everbright Limited, being a member of China Everbright Group, is the second largest shareholder of Everbright Securities (stock code: 601788.SH), a strategic shareholder of China Everbright Bank (stock code: 601818.SH, 6818.HK), the controlling shareholder of the Hong Kong-listed China Aircraft Leasing Group Holdings Limited (stock code: 1848.HK) and the second largest shareholder of the Singapore-listed Ying Li International Real Estate Limited (stock code: 5DM. SGX).
After the launch of "Shanghai-Hong Kong Stock Connect" on 10 April 2014, CEL becomes one of the first batch of specific stocks listed on The Stock Exchange of Hong Kong which can be directly traded by Mainland investors.
Through upholding the philosophy of "Making Wealth Simple", CEL leverages on its own substantial financial strength, as well as the position and influence of China Everbright Group and its affiliated companies in the financial industry in China, and has successfully built huge cross-border social and business networks in Hong Kong and the Mainland, and established a reputable image in the market.
For more information, please visit www.everbright165.com.
For enquiries, please contact:
Golin
Nan Dong
Tel: 2501 7902/ 9733 6558
Fax: 2810 4780
Email: NDong@golin.com
Jackie Cheung
Tel: 2501 7901
Fax: 2810 4780
Email: Jcheung@golin.com
Topic: Press release summary
Source: China Everbright Ltd
Sectors: Daily Finance, Daily News
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From the Asia Corporate News Network
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