Annual Report - QuamIR

Chairman’s Statement (Continued)
For 2012, HKC will continue to streamline its business and explore
opportunities to sell assets that are not part of its core real estate business.
Management continually evaluates property market conditions, and looks
to sell existing assets that no longer match with the growth direction of the
Group, with the intention of reinvesting the proceeds in higher potential
projects.
Balance sheet remains strong.
Given macroeconomic tightening by the government, there has been fear
over the solvency of Chinese property developers. However, the Group is well
positioned as it is conservatively geared with a net debt ratio of only 2.4%.
Moreover, there are no major debts that are coming due. Only HK$740.0
million is due in 2012, HK$533.1 million is due in 2013, HK$2,457.8 million
is due in 2014 and thereafter. The Group’s cash on hand is sufficient to
support HKC’s requirements for working capital, as well as to cover the initial
development costs of a number of projects.
For 2011, HKC will have distributed dividends worth an
equivalent to HK$0.038.
To partially unlock the value of the Group’s assets, the Group, during the
interim period, distributed shares of China Renewable Energy Investment
Limited (“CRE”) to shareholders, while still maintaining enough shares to
maintain the Group’s control over the subsidiary.
2.4%
740,000,000
533,100,000
2,457,800,000
0.038
In addition, the Group has distributed a special cash dividend of HK$0.01
per ordinary share for the interim period. Board of Directors is recommending
an additional final special cash dividend of HK$0.01, or a total special cash
dividend of HK$0.02 for the full year. Combined with the distribution of
CRE shares, shareholders will have received a special cash dividend and
CRE shares worth HK$0.038 per HKC share (based on the closing price of
HK$0.315 per CRE share as of 22 March 2012), or an equivalent dividend
yield of 9% based on the closing price of HK$0.42 per HKC share as of 22
March 2012.
0.01
0.01
0.02
0.038
0.315
9%
0.42
6 HKC (Holdings) Limited • Annual Report 2011