Shenzhen Overseas Chinese Town Co.Ltd(000069) : record of investor relations activities on March 31, 2022 (Performance Presentation meeting)

Shenzhen Overseas Chinese Town Co.Ltd(000069) investor relations activity record

Securities code: Shenzhen Overseas Chinese Town Co.Ltd(000069) securities abbreviation: OCT a No.: 202206

\uf0a3 research on specific objects \uf0a3 analyst meeting

Investor relations □ media interview □ performance briefing

Activity category □ press conference □ Roadshow

\uf0a3 teleconference □ others

The participating units hold the annual report performance explanation meeting of the company through panorama, which is open to all investors

Time: 15:00-16:35, March 31, 2022

Panoramic view of the site Roadshow world https://rs.p5w.net./

Liu Fengxi, vice chairman, Wang Xiaowen, President, Zhang Dafan, vice president and yuan, vice president are listed companies

Jing Ping, vice president Ni Mingtao, chief accountant Feng Wenhong, board secretary Guan Shan, receptionist

Wang Wenjin, director of strategy and investment management department, Zhang Shumin, director of Tourism Management Department

1、 Annual performance introduction of the company in 2021

The management of the company introduced the business performance in 2021 and the master plan of future development relationship activities from four aspects: overall operation, financial data, cultural and tourism investor affairs and real estate business.

In 2021, facing the repeated covid-19 epidemic and the pressure of real estate regulation and upgrading, the company firmly focused on the main business for development, led by the recovery of cultural and tourism business. The performance of real estate business was relatively stable, and the operating revenue exceeded 100 billion for the first time. Although the profit performance was under pressure, the "three red lines" maintained overall health and green, with reasonable capital structure, abundant liquidity and continuous improvement of asset efficiency, The ability of risk control was comprehensively enhanced.

In 2021, the company continued to innovate in the fields of cultural tourism, real estate and digital transformation, showing many business highlights, which laid a good foundation for the high-quality development of the company.

The recovery level of cultural tourism business leads the industry. The company's scenic spots, hotels, travel agencies and Tourism Performing Arts received 36.564 million tourists, and the recovery is far higher than the industry average. In the 2021 OCT Cultural Tourism Festival, the company integrated all kinds of cultural and tourism resources under its banner, and set off another wave of festival upsurge with more than 100 theme activities. This year, the newly launched "bay area light" Ferris wheel of Shenzhen happy harbor, Xiangyang Qiqu childhood parent-child paradise, Xi'an Happy Valley Maya beach water park and other projects have quickly become new cultural and tourism landmarks around the country.

The real estate business has developed steadily. In terms of resource acquisition, focusing on the selection of the best in the core cities, 23 land projects were obtained throughout the year, of which 15 projects were delisted at or close to the base price, with a new capacity building area of 4.35 million square meters, effectively ensuring sustainable development. In terms of development and decontamination, the company paid close attention to engineering and sales. Some projects achieved land acquisition and opening only seven months. The company achieved a contracted area of 3.99 million square meters and contracted sales of 82.5 billion yuan throughout the year. In terms of property management, 3.73 million square meters of newly managed construction area and more than 20 million square meters of under management construction area were added throughout the year, covering 54 cities such as Shenzhen, Beijing, Shanghai and Chengdu.

The digital transformation is advancing steadily. In terms of management informatization, it basically realizes the full coverage of the system and efficiently supports administrative office, strategic control and business decision-making. In terms of business digitization, we launched the "I Happy Valley" applet, built a multi business combination and collaborative ecosystem, and continuously enabled our main business. In terms of digital industrialization, the sales of its flower orange tourism platform increased by more than 60% year-on-year, and the number of registered users exceeded 11 million. 2、 Q & a communication link 1. There is a gap between the company's real estate turnover efficiency and the head enterprise. Are there relevant assessment requirements and whether there is room for improvement in the turnover speed of sales business in the future? The company has clear requirements on the turnover speed of payment collection and real estate sales projects in the annual assessment. At present, the development cycle, cost control and quality control of some projects of the company have reached the industry-leading level. In the future, the company will continue to focus on the improvement of operation and management quality and efficiency, adhere to the long-term business strategy of increasing liquidity through equity, asset cooperation and transfer, and further improve the turnover speed of various businesses on the premise of strictly ensuring the quality of the project. 2. What are the reasons for the sharp decline of the company's sales area and amount from January to February; The source value of 788 Suites in Shanghai Tangzhen project exceeds 6 billion, which has been sold out in January, but the total sales of the company in January and February are only 3.2 billion and 5.3 billion. What is the reason?

From January to February 2022, China's real estate sales continued to decline. Under this environment, the sales area and amount of the company in January and February showed a downward trend compared with the same period of last year. The company will continue to track the status of the industry, grasp the market window in time, and adopt flexible business means to promote sales in different stages of the project and facing different market periods. The contracted sales amount published in the company's regular report and monthly announcement is the amount that has actually completed online signing. Tang town project opened on January 24, 788 houses were sold out, and the down payment of RMB 3.65 billion has been received. Due to the limited number of official online signing places in Shanghai every day, the online signing of 350 million yuan and 380 million yuan were completed in January and February respectively, and the amount has been fully included in the contract sales amount of the current month. The mortgage collection will be promoted according to the follow-up online signing progress. 3. The company has many integrated tourism projects. What are the advantages of this model?

The comprehensive development of the area based on the cultural and tourism project has always been the unique advantage of Oct. the company develops and operates cultural and tourism industries such as scenic spots, hotels and commercial complexes, and forms multi industry development and operation through the introduction of cultural and creative industries, property services and other supporting facilities. This kind of project will have a certain cost advantage because it meets the government's industrial investment demand and the market competition pressure faced by the acquisition of land resources is relatively small; At the same time, in terms of property sales, based on the company's long-term contribution to cultural tourism and other industries, superimposed brand premium and the appreciation of the project caused by integrated development, the industry can provide empowerment. Therefore, from a comprehensive point of view, the competitive advantage is very obvious. 4. During the 14th Five Year Plan period, what are the development ideas of the company's two main businesses, and will the strategic focus of culture, tourism and real estate be adjusted?

The 14th five year plan of the company defines the development idea of taking tourism as the core growth pole, urbanization as the chassis and innovation and digitization as the new driving force. The company will maintain its strategic focus, adhere to the innovative development model with strong vitality, and take real estate and cultural tourism as its main business.

Specifically, the core of optimizing the development model of "culture + tourism + urbanization" is to realize three changes.

First, establish the central position of tourism business, strengthen the construction of operation capacity and product innovation, highlight the driving role of tourism products in comprehensive development projects, and highlight the improvement of the profitability of tourism products. Second, return to the compensation function of urbanization. Through the overall regional planning, precise layout, improve the professional development ability, and continue to play the compensation role of urbanization in supporting tourism development. Third, focus on high-energy and advantageous regions, tap market potential, focus on advantageous product lines, and improve the overall development efficiency through the improvement of professional ability and business scale. 5. How to view the medium and long-term development prospects of the real estate industry, and what is the company's investment strategy and expansion plan in 2022?

In 2016, the central economic work conference first proposed "no speculation in housing", and subsequently issued a series of regulatory measures such as "three red lines", which effectively restrained the demand for speculative and investment real estate, strengthened the financial supervision of real estate enterprises, and promoted the transformation of funds from virtual to real. The 2022 government work report once again made it clear to ensure the housing needs of the people and promote the virtuous circle and healthy development of the real estate industry. All these reflect that the real estate industry will continue to develop healthily under the socialist market economy and will still be one of the important industries in China's economic development. It will only change the development mode and product form and return to the residential attribute. Recently, the central and local governments have successively issued policies to promote the healthy development of the real estate industry. With the in-depth adjustment of the real estate industry and the reshaping of the competition pattern, the industry will be further divided. Enterprises with excellent operation and management ability, safe cash flow and social welfare will usher in new development opportunities.

Combined with its own cultural tourism business, Oct a has formed a real estate development model with its own characteristics. In the current complex internal and external environment, the company will pay close attention to the market dynamics in 2022, strengthen comprehensive research and judgment, strive for progress while maintaining stability, settle investment by closing, and expand resources on the premise of maintaining the bottom line of risk. On the one hand, the company will give full play to the advantages of Chengwen's land and comprehensive development mode, and give full play to Chengwen's high-quality land development and comprehensive economic development mode; On the other hand, cultivate internal skills and promote the sustainable and high-quality development of the company by means of innovative development mode and improving management level.

Specifically, first, insist on taking the quality of resources as the core index of project expansion, strengthen the research and judgment of targets, focus on core areas and high-quality projects, take the core area of core urban agglomeration as the main investment direction, and focus on the decontamination rate and capital turnover; Second, give play to the advantages and innovative models, provide the government with professional services in the whole process of public service facility construction and operation, and indirectly obtain advantageous resources; Third, expand business boundaries and intervene in the comprehensive development of urban stock core areas by means of urban renewal / old city transformation; Fourth, moderately carry out the construction of industrial parks and other projects as a supplement to the real estate business; Fifth, intervene in the government's policy guarantee housing development projects; Sixth, actively promote digital transformation and enabling management, and seek benefits from management. 6. The reasons for the large-scale provision of impairment in 21 years, whether it is possible to reverse it in 22 years, and whether there is any impairment expectation?

In 2021, the company's impairment scale expanded. First, due to industrial policies, government price restrictions and other reasons, the sales price of some real estate M & A projects was lower than the market expected price in the feasibility study of the project, and the impairment was withdrawn based on the principle of prudence, accounting for 56% of the impairment; Second, for the two long-term equity investments of Yuzhou and Yiju, the impairment is accrued due to the liquidity risk that their debts may not be repaid or their accounts receivable cannot be recovered, accounting for 33%; Third, due to the repeated impact of the epidemic on some comprehensive business projects, impairment shall be accrued.

If the market situation improves in the future, the impairment of the inventory part whose impairment signs have disappeared can be reversed; The impairment of fixed assets and long-term investment cannot be reversed in accordance with the provisions of accounting standards. Whether the subsequent impairment is continuously accrued depends on the industry situation and market trend. If the market continues to decline, the possibility of continuous impairment is not ruled out. 7. How does the company view the risk of M & A and what is the plan and progress of M & A at this stage?

The main possible risks in M & A include project quality risk, excessive consideration risk, contingent liability risk of the acquired company, post M & a company integration risk, etc.

Under the leadership of the state owned assets supervision and Administration Commission and the board of directors, the company will, in accordance with relevant policy guidelines and the principle of seeking progress while maintaining stability and selecting the best among the best, make full project adjustment, take into account the rationality of project quality and consideration, reduce the risk to a controllable range as far as possible by reasonably controlling the purchase price, clarifying business terms and other means, and carry out M & A prudently and steadily.

Generally speaking, M & A and bidding and auction are two ways to obtain resources. We all take the quality of resources as the core standard. The risk of M & A projects is generally higher, so there will be higher requirements for risk control. 8. In the past two years, the epidemic has continued to break out at many points. What has been the impact on the company's cultural and tourism business and to what extent?

The recurrence of the epidemic in the past two years has had a great impact on China's cultural tourism industry, and the company's cultural tourism business has also been affected to a certain extent. On the one hand, the company paid close attention to epidemic prevention and control. Since the outbreak in 2020, the company has actively taken response measures and successively formulated and issued guidance documents on various prevention and control measures, such as guidelines on epidemic prevention and control and park opening operation of OCT scenic spots, notice on promoting reservation management of OCT scenic spots, etc. After the multi-point outbreak of the epidemic last year, the company also issued the emergency notice on Further Strengthening the epidemic prevention and control of OCT cultural and tourism enterprises for the first time. Its cultural and tourism enterprises have always strictly implemented the requirements of "limit, reservation and peak staggering", and strictly implemented measures such as booking tourism, real name registration, measuring body temperature, "one meter line", wearing masks, checking health codes and travel codes, so as to ensure that tourist information can be queried and tracked. In particular, we will further strengthen epidemic control and epidemic prevention measures for front-line employees in areas, projects and places where people are likely to gather, such as tourist service centers, ride points, queuing areas and dining points. It is recommended to keep the distance between public and private dining utensils, and strictly implement the measures of disinfection of non-public chopsticks and check-out. Travel agencies pay close attention to the latest situation of the epidemic, do a good job in the adjustment of tourism products and smooth response measures, and provide safe, hygienic, thoughtful and considerate tourism environment and services for the majority of tourists.

On the other hand, the company pays close attention to production and operation. All cultural and tourism enterprises actively change their business ideas from product renewal, festival activities, marketing mode, service quality and technology application, adapt to market changes, strive to make more innovation and exploration, and actively reduce the impact of the epidemic. The company's cultural and tourism enterprises are in good operation. In 2021, they received 77.979 million tourists, 182% in 2020 and 150% in the same period in 2019. The recovery is far higher than the industry average.

With the improvement of the epidemic prevention and control situation, the industry as a whole will continue to recover. It is expected that the company's cultural tourism business will continue to improve with the expansion of market scale. 9. Which head enterprises does the company cooperate with to develop the project, whether it cooperates with the private enterprises out of danger, and whether it will consider preventing future risks by acquiring the equity of the cooperative project?

The introduction of head enterprises for cooperative development helps to realize complementary advantages, enhance competitiveness and reduce development risks. It is one of the measures taken by the company to speed up the turnover in the past and in the future. At present, the top enterprises cooperating with the company include Vanke, poly, country garden, rongchuang, China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) etc. Generally speaking, the operation of these enterprises is in good condition and the capital risk is still controllable.

The company pays close attention to the risk problems before individual cooperative projects, including formulating follow-up risk response plans. If the cooperative enterprises have capital risks

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