ChinaScope Daily Dim Sum: March 2012

Friday, March 30, 2012

Mar 30 - Tsingtao Brewery: Net Profit CNY 1.74 Billion in 2011, 14.3% Growth

Source: Shanghai Stock Exchange, ChinaScope Financial (Data)

+ Yesterday, Tsingtao Brewery Co., Ltd. (600600.SH, 0168.HK) released its 2011 annual report, showing that sales volume increased 12.6% year-on-year to 7.15 million kiloliters; operating revenue reached CNY 23.16 billion, a 16.38% year-on-year increase, and net profit attributable to shareholders increased 14.3% year-on-year to CNY 1.74 billion.

+ In 2011, the sales volume of Tsingtao Beer increased 15% to 3.99 million kiloliters, of which 1.2 million kiloliters were high-end beer products, a 23% year-on-year increase.

Revenue growth has been robust in 2011 and margin rates have kept stable, leading to an EPS increase of 14.3% compared to last year.

The sales volume of Tsingtao Brewery has been growing steadily;, meanwhile the company’s market share is also rising.

Other News Headlines:

n PBOC’s Foreign Exchange Reserves at CNY 23.48 Trillion in Feb.

n Net Profit of Five State-Owned Banks at CNY 674.5 Billion in 2011, Up 25% YoY

n PetroChina Net Profit Falls 4.9% to CNY 132.98 Billion in 2011

n 45 Land Plots in Beijing Sold at Starting Price in Q1

n Tsingtao Brewery: Net Profit CNY 1.74 Billion in 2011, 14.3% Growth

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Mar 30 - 45 Land Plots in Beijing Sold at Starting Price in Q1

Source: National Business Daily, ChinaScope Financial (Data)

+ Data from the Beijing Land Consolidation and Reserve Center shows that in the first quarter of 2012, 45 land plots were sold at starting price in Beijing. This is the first time that all land plots are sold at starting price, indicating sluggish demand.

+ The price for the 45 land plots was CNY 9.67 billion, down 39.3% from last year’s CNY 15.9, and the first time in nine quarters that land price in Beijing falls below CNY 10 billion.

The total land transaction volume in Beijing decreased significantly in Q1 2012. However, the year-on-year transaction volume of residential land did not decrease

Lower land supply was the main reason for the decrease in transaction volume, as indicated by the higher land supply/trading ratio.

Tongzhou District and Daxing District still ranked top in land transaction volume.

Other News Headlines:

n PBOC’s Foreign Exchange Reserves at CNY 23.48 Trillion in Feb.

n Net Profit of Five State-Owned Banks at CNY 674.5 Billion in 2011, Up 25% YoY

n PetroChina Net Profit Falls 4.9% to CNY 132.98 Billion in 2011

n 45 Land Plots in Beijing Sold at Starting Price in Q1

n Tsingtao Brewery: Net Profit CNY 1.74 Billion in 2011, 14.3% Growth

Mar 30 - PetroChina Net Profit Falls 4.9% to CNY 132.98 Billion in 2011

Source: PetroChina Co., Ltd. , ChinaScope Financial (Data)

+ The 2011 annual report of PetroChina Co., Ltd. (601857.SH, 0857.HK, PTR.NY) shows that the company’s net profit dropped 4.9% year-on-year to CNY 132.98 billion.

+ As China’s largest crude oil producer, PetroChina’s oil and gas equivalent output reached 1.29 billion barrels last year, up 4.7% from 1.23 billion in 2010. Meanwhile, overseas oil and gas equivalent output increased 18.2% to 120.8 million barrels.

+ In 2011, PetroChina’s revenue from exploration and production reached CNY 774.78 billion, up 42.2% year-on-year, while it made a loss in oil refining and the chemical industry of CNY 61.87 billion.

+ In comparison, net profit of China Petroleum & Chemical Co. (600028.SH, 0386.HK, SNP.NY) was CNY 71.7 billion, and net profit of China Oilfield Services Ltd. (601808.SH, 2883.HK) was CNY 70.26 billion in 2011.

Despite increase in revenue, falling margin has resulted in negative growth rates of net profit attributed to shareholders

All segment margins except that of exploration and production have declined

Other News Headlines:

n PBOC’s Foreign Exchange Reserves at CNY 23.48 Trillion in Feb.

n Net Profit of Five State-Owned Banks at CNY 674.5 Billion in 2011, Up 25% YoY

n PetroChina Net Profit Falls 4.9% to CNY 132.98 Billion in 2011

n 45 Land Plots in Beijing Sold at Starting Price in Q1

n Tsingtao Brewery: Net Profit CNY 1.74 Billion in 2011, 14.3% Growth

Mar 30 - Net Profit of Five State-Owned Banks at CNY 674.5 Billion in 2011, Up 25% YoY

Source: ICBC, BOC, ABC, CCB, BOCOMM, ChinaScope Financial (Data)

+ The net profit of China’s five state-owned banks (ICBC, BOC, ABC, CCB, BOCOMM) totaled CNY 674.5 billion in 2011, a 25% year-on-year increase. Net fee and commission income in the five banks grew to CNY 351.51 billion.

+ The Industrial and Commercial Bank of China (ICBC) (601398.SH, 1398.HK) 2011 annual report released on March 29 shows net profit increasing 25.6% year-on-year to CNY 208.45 billion.

+ Bank of China’s (BOC) (601988.SH, 3988.HK) annual report, released today, reports net profit at CNY 124.18 billion, an 18.93% year-on-year increase.

Non-interest income is making up an increasing share of the banks’ total revenue, with fee and commission income being a major component of non-interest income.

Trading Comparable

Other News Headlines:

n PBOC’s Foreign Exchange Reserves at CNY 23.48 Trillion in Feb.

n Net Profit of Five State-Owned Banks at CNY 674.5 Billion in 2011, Up 25% YoY

n PetroChina Net Profit Falls 4.9% to CNY 132.98 Billion in 2011

n 45 Land Plots in Beijing Sold at Starting Price in Q1

n Tsingtao Brewery: Net Profit CNY 1.74 Billion in 2011, 14.3% Growth

Mar 30 - PBOC’s Foreign Exchange Reserves at CNY 23.48 Trillion in Feb.

Source: People's Bank of China, ChinaScope Financial (Data)

+ The PBOC’s foreign exchange reserves increased CNY 175.04 billion to CNY 23.41 trillion in January, and further increased CNY 63.05 billion to CNY 23.48 trillion in February.

+ The PBOC has suspended the issuance of central bills for 13 consecutive weeks and uses repurchase agreements to regulate market liquidity.

+ In the past week, PBOC has injected a net capital of CNY 19 billion through open market operations.

Amidst decrease in FDI, hot money inflow and trade surplus, the growth of PBOC’s foreign reserves holdings slowed down in the latter part of 2011.

Other News Headlines:

n PBOC’s Foreign Exchange Reserves at CNY 23.48 Trillion in Feb.

n Net Profit of Five State-Owned Banks at CNY 674.5 Billion in 2011, Up 25% YoY

n PetroChina Net Profit Falls 4.9% to CNY 132.98 Billion in 2011

n 45 Land Plots in Beijing Sold at Starting Price in Q1

n Tsingtao Brewery: Net Profit CNY 1.74 Billion in 2011, 14.3% Growth

Wednesday, March 28, 2012

Mar 28 - Western Securities’ IPO Review Completed

Source: 21st Century Business Herald, ChinaScope Financial (Data)

+ Sources say that the IPO review of Western Securities has been completed, and that the China Securities Regulatory Commission (CSRC) will grant the approval soon.

+ Western Securities plans to issue a maximum of 200 million shares, with an issue price of CNY 11.88 per share, with the goal of raising CNY 2.38 billion.

Measured in terms of total assets and net profit, Western Securities is on a par with its competitors. The brokerage sector shrank in 2010 because of weak stock market performance.

Trading Comparable

Other News Headlines:

n Profit of Industrial Enterprises Fell 5.2% YoY in Jan-Feb 2012

n Mengniu Dairy: Net Profit Increases 28.4% to CNY 1.59 Billion in 2011

n GOME: Net Profit Drops 6.2% YoY to CNY 1.84 Billion in 2011

n Western Securities’ IPO Review Completed

Mar 28 - GOME: Net Profit Drops 6.2% YoY to CNY 1.84 Billion in 2011

Source: Hong Kong Stock Exchange, ChinaScope Financial (Data)

+ GOME Electrical Appliances Holdings Ltd. (493.HK) released its 2011 annual report on March 27. The report shows that GOME made CNY 59.82 billion in revenue, a 17.5% year-on-year increase while net profit margin fell 6.2% year-on-year, to CNY 1.84 billion.

+ The number of GOME-owned stores increased from 826 in 2010 to 1,079 in 2011. Same store sales growth increased 3.06% YoY in 2011.

Despite higher gross margin, the net margin dropped due to significantly higher selling expenses in 2011.

GOME (0493. HK) is continuing closing down stores with limited profitability, albeit at a slower pace than previously. Meanwhile, the company has started rapid store expansion again.

Other News Headlines:

n Profit of Industrial Enterprises Fell 5.2% YoY in Jan-Feb 2012

n Mengniu Dairy: Net Profit Increases 28.4% to CNY 1.59 Billion in 2011

n GOME: Net Profit Drops 6.2% YoY to CNY 1.84 Billion in 2011

n Western Securities’ IPO Review Completed

Mar 28 - Mengniu Dairy: Net Profit Increases 28.4% to CNY 1.59 Billion in 2011

Source: Hong Kong Stock Exchange, ChinaScope Financial (Data)

+ On March 27, Mengniu Dairy Co., Ltd. (2319. HK) released its annual report, showing that the company’s operating revenue increased 23.5% year-on-year to CNY 37.39 billion in 2011, and net profit increased 28.4% year-on-year to CNY 1.59 billion. Earnings per share (EPS) increased 27.5% to CNY 0.908.

+ In 2011, 90% of Mengniu’s revenues came from liquid milk sales, from which it made CNY 33.7 billion. WU Jingshui, Mengniu’s Executive Director and CFO, said that in the next three to five years, the company plans to invest CNY 3-3.5 billion in pasture construction, and expand its cattle stock by 150,000.

Mengniu Dairy’s (2319.HK) gross margins remained stable in 2011, supported by growing sales revenue from liquid milk.

Inventory turnover slowed down, possibly caused by an increase in prices – below estimated as revenue/production capacity.

Mengniu Dairy’s production capacity accounts for a significant proportion of the national aggregate.

Other News Headlines:

n Profit of Industrial Enterprises Fell 5.2% YoY in Jan-Feb 2012

n Mengniu Dairy: Net Profit Increases 28.4% to CNY 1.59 Billion in 2011

n GOME: Net Profit Drops 6.2% YoY to CNY 1.84 Billion in 2011

n Western Securities’ IPO Review Completed

Mar 28 - Profit of Industrial Enterprises Falls 5.2% YoY in Jan-Feb 2012

Source: NBS, ChinaScope Financial (Data)

+ Industrial enterprises above designated size realized a total profit of CNY 606 billion in Jan-Feb 2012, decreasing 5.2% year-on-year.

+ Profits of state-owned and state-holding enterprises fell 19.7% year-on-year to CNY 179.1 billion; total revenue was CNY 3.53 trillion, a 7.5% year-on-year decrease, the operating cost-to-income ratio was 81.9% and revenue margins was 5.08%.

The profit growth for industrial enterprises with operating revenues above CNY 20 Mn went negative in Jan/Feb 2012; the first time with negative growth since November 2009.

Other News Headlines:

n Profit of Industrial Enterprises Fell 5.2% YoY in Jan-Feb 2012

n Mengniu Dairy: Net Profit Increases 28.4% to CNY 1.59 Billion in 2011

n GOME: Net Profit Drops 6.2% YoY to CNY 1.84 Billion in 2011

n Western Securities’ IPO Review Completed

Tuesday, March 27, 2012

Mar 27 - Net Profit of Datang International Power Falls 23% in 2011

Source: Hong Kong Stock Exchange, ChinaScope Financial (Data)

+ On March 25, Datang International Power Generational Co., Ltd. (601991. SH, 0991. HK) released its 2011 annual report, showing that operating revenue increased 19.3% to CNY 72.38 billion, while net profit decreased 23.3% to CNY 1.97 billion, with earnings per share (EPS) of CNY 0.15. The company plans to distribute stock dividends of CNY 0.11 (including tax).

+ In 2011, Datang’s total operating costs increased 22% to CNY 62.83 billion, of which 70.8% was fuel cost. Furthermore, due to higher borrowing costs, the company’s financial expenses increased 32% to CNY 7.1 billion. Datang’s total liabilities amounted to CNY 196.9 billion in 2011, with a debt ratio of 79.52%.

The growth in generating capacity of Datang (0991.HK) has slowed down in 2011

The average coal consumption rate has continued to drop. Fuel costs have been driven up by higher coal prices

Other News Headlines:

n Net Profit of China Life Insurance Fall 45.5% YoY

n Hua Xia Bank: 2011 Net Profit Rises 54% to CNY 9.22 Billion

n Value of Powerlong’s 2011 Contracted Sales Only Half of Annual Target

n Net Profit of Datang International Power Falls 23% in 2011

Mar 27 - Hua Xia Bank: 2011 Net Profit Rises 54% to CNY 9.22 Billion

Source: Shanghai Stock Exchange, ChinaScope Financial (Data)

+       According to the annual report released by Hua Xia Bank Co., Ltd. (600015.SH) today, the bank made CNY 8.22 billion in net profit in 2011, up 53.97% year-on-year, and plans to pay out a cash dividend of CNY 0.25 per share to all shareholders.

+       The bank’s revenue was CNY 33.54 billion, increasing 37.03% year-on-year, in 2011.

+       At the end of 2011, outstanding non-performing loans totaled CNY 5.6 billion, decreasing 10.46%, or CNY 654 million, from 2010. The non-performing loan ratio was 0.92%, provision coverage ratio 308.21%, capital adequacy ratio 11.68%, and core capital adequacy ratio 8.72%.

HXB has been expanding their non-interest income business and so despite lower growth of loans and deposit, net profits increased rapidly in 2011.

Trading Comparable

Other News Headlines:

n Net Profit of China Life Insurance Fall 45.5% YoY

n Hua Xia Bank: 2011 Net Profit Rises 54% to CNY 9.22 Billion

n Value of Powerlong’s 2011 Contracted Sales Only Half of Annual Target

n Net Profit of Datang International Power Falls 23% in 2011