Download Factsheet 2014 Annual

Zhejiang Expressway Co., Ltd.
(HKEx: 576; LSE: ZHEH;
ADR: ZHEXY)
12/F, Block A, Dragon Century Plaza
1 Hangda Road, Hangzhou City
Zhejiang Province, PRC, 310007
Website: www.zjec.com.cn
Investor Relations Contact
Zhejiang Expressway Co., Ltd.
Mr. Tony Zheng
(86) 571 8798 7700
[email protected]
Ms. Helen Wu
(86) 571 8790 1966
[email protected]
Christensen Investor Relations
Ms. Jung Chang
(852) 2117 0861
[email protected]
Mr. Ricky Tan
(852) 2232 3941
[email protected]
Financial Highlights
Fiscal Year End
Dec 31
__________________________________
Current Price
(March 19, 2015)
HK$9.07
__________________________________
52-Week Range
HK$6.71-HK$10.00
__________________________________
PE
13.39(X)
__________________________________
Market Cap
HK$39,392M
__________________________________
2014 Revenue
RMB 9,051M
__________________________________
2014 Profit
attributable
to owners of the
Company
RMB 2,349M
__________________________________
2014 EPS
RMB 54.09 cents
__________________________________
2014 ROE
14.3%
__________________________________
Corporate Profile
Established in 1997, Zhejiang Expressway Co., Ltd. is regarded by
the Zhejiang Provincial Government to be its main enterprise for
investment in and development, operation, maintenance and
management of high-grade roads in Zhejiang Province. The
Company and its subsidiaries (the “Group”) has concession rights
to operate the 248km Shanghai-Hangzhou-Ningbo Expressway
and the 142km Shangsan Expressway for a period of 30 years,
and also the 70km Ningbo-Jinhua Expressway (Jinhua section)
for a period of 25 years. The Group also carries out certain
ancillary businesses such as restaurants, shops, and gas stations
within service areas and billboard advertising along expressways,
as well as securities businesses across the country.
The H Shares of the Company were listed on the Hong Kong
Stock Exchange on May 15, 1997, and the Company
subsequently obtained a secondary listing on the London Stock
Exchange on May 5, 2000. On February 14, 2002, a Level I
American Depositary Receipt program sponsored by the
Company in respect of its H Shares was established in the United
States.
Market Review
In 2014, Zhejiang Province’s economy steadily improved and
foreign trade rose, alongside China’s continued transition into a
“New Normal” economy focusing on quality over quantity of
growth. For Zhejiang Province, GDP growth was 7.6% year-onyear, compared to 7.4% growth for China overall.
Furthermore, the trading volume in securities markets in China
increased by a substantial 63.8% year-on-year during the year.
* Bureau of Statistics of Zhejiang Province
GDP Growth Rate - PRC vs Zhejiang
Province
(%)
14
11.8
12
10
8.7 8.9
9.2
9.2 9
8
7.8 8
7.7
6.4
7.4 7.6
6
4
2
0
2009
2010
2011
China
2012
Zhejiang
2013
2014
PRC government and Zhejiang Province
continue to invest heavily in toll road and Management Team
infrastructure
Mr. Xiaozhang Zhan
According to figures released by the Ministry of
Communications, investment in highway fixed assets
amounted to RMB2,166.8 billion by the end of
November 2015, up 13.5% yoy.
Chairman




5,000
5,000
4,000
3,000
2,000
1,000
0
3,618
Ms. Jianhu Luo
Executive Director & General Manager

2020
2018
2016
2014
2012
2008
2005
2003
2001
1999
1997
1995

2010
km
Total Mileage of Expressways in
Zhejiang Province
Appointed Chairman in Jun 11, 2012
Appointed Executive Director and General Manager on
Mar 1, 2009
Senior economist; master’s degree from the Business
Institute of Zhejiang University
Has extensive experience working in Zhejiang Provincial
Government

Operating environment – steady growth in toll
income boosted by steadily improving
economy
Appointed Executive Director and General Manager in
Jun 11, 2012
Graduated from the Department of Law of Hangzhou
University, majoring in Economic Law; a senior
economist with a bachelor’s degree in law
Held positions such as board secretary of Zhejiang
Transportation Engineering Construction Group Co.,
Ltd., Secretary and Assistant to Director of the
Secretarial Office to the Board, Deputy Director of the
Legal Affairs Department, deputy director of the
Secretarial Office to the board and the manager of the
Investment and Development Department of Zhejiang
Communications Investment Group Co., Ltd.
In 2014, the Group’s major highway, the ShanghaiHangzhou-Ningbo Expressway, was negatively affected
by traffic diversion as a result of the new JiaxingShaoxing Bridge, however the Shangsan and NingboJinhua Expressway both saw high organic growth thanks Mr. Jingzhong Zhang
to the improving economy in Zhejiang Province.
Respectively, toll income fell 0.4% and rose 28.3% and Deputy General Manager
 Joined Zhejiang Provincial Political Science and Law
16.0% during the year.
Policy Research Unit in 1984
 Served as Associate Director of Hangzhou Municipal
The Group utilized various measures to increase toll
income, with a focus on plugging loopholes, reducing Foreign Economic Law Firm from 1988 to 1994. In 1992,
costs, and increasing efficiency. Targeted publicity he obtained the qualifications required by the regulatory
measures alongside a 20% reduction in equipment use authorities in China to practice securities law
cost and administration fees allowed the Group to reach  Has been an Executive Director and Company Secretary
a record high in revenue. The Group will continue to of the Company since March 1997, and was appointed
focus on reform and innovation as two main themes Deputy General Manager in March 2002. Currently also
within its businesses, and continue to drive human serves as Director at Shangsan Co., Development Co.,
and Vice Chairman at Zheshang Securities
resource improvements going forward.
Securities business – robust growth in Mr. Dehua Wang
brokerage commission income
In 2014, Zheshang Securities experienced significant
growth in market share and trading volume, riding on
the 63.8% increase in trading volume of stock markets
in China.
Chief Financial Officer



Income from investment banking, margin financing and
securities lending and asset management all
accelerated due to all-round development in each
business segment.
Zheshang Securities’ was recognized as a qualified
broker in the Shanghai-Hong Kong Stock Connect.
Mr. Tony Zheng
Company Secretary

Zheshang Securities’ IPO application to the Shanghai
Stock Exchange was accepted by the CSRC in May, 2013.
Zheshang Securities remains on the wait list for an IPO.
Appointed Chief Financial Officer in March 2014.
Graduated from University of Hong Kong in 2007; holder
of master’s degree in Economics
Has been a Deputy General Manager of Zhejiang
Communications Investment Group Co., Ltd. from 2011
to 2014


Appointed Company Secretary in March 2011
Continues to serve as Director of the Secretarial Office to
the Board of the Company
Graduated from University of California at Berkeley with
Bachelor of Science in Civil Engineering
Ownership Length in
(%)
Kilometres
Expressway
No. of
Lanes
No. of Toll
Stations
No. of
Service
Areas
Start of
Operation
Remaining
Years of
Operation
1998
14
Shanghai-Hangzhou Expressway
- Jiaxing section
99.9995%
88.1
8
7
2
51%
11.1
6
1
0
100%
3.4
4
2
0
1995
14
- Hangzhou to Hongken section
100%
16.0
4
1
0
1992
13
- Hongken to Duantang section
100%
124.0
8
9
2
1995
13
- Duantang to Dazhujia section
100%
5.0
4
1
0
1996
13
73.625%
142.0
4
11
3
2000
16
100%
69.7
4
7
1
2005
16
- Yuhang section
- Hangzhou section
1995-
14
1998
Hangzhou-Ningbo Expressway
Shangsan Expressway
Jinhua section, Ningbo-Jinhua
Expressway
Financial Highlights
Operational Highlights
Results Highlights
Income Breakdown
Year ended December 31
(Rmb million)
2014
2013 % change
Revenue
9,051
7,851
+15.3
(5,576)
(4,956)
+12.5
Gross profit
3,475
2,896
+20.0
Profit before tax
3,768
2,972
+26.8
Profit for the year
2,850
2,215
+28.7
2,349
1,907
+23.2
54.09
43.92
+23.2
Operating costs
Year ended December 31
2014
2013
% change
Toll
4,259
4,020
+5.9
Service areas
2,208
2,055
+7.4
83
104
-20.2
2,419
1,651
+46.5
82
21
+290.5
9,051
7,851
+15.3
Advertising business
Securities business
Others
Profit attributable to
Owners of the Company
Basic EPS (cents)
Total
Daily Traffic Volume of SHN Expressway
55,000
Revenue (Year ended December 31) (RMB million)
7851
6,781
6,700
2010
50,000
(Full-trip)
9051
6,769
(Rmb million)
6,036
2011
45,000
2012
2013
40,000
2014
35,000
2015
30,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Daily Traffic Volume of Shangsan
Expressway
2010
2011
2012
2013
2014
30,000
(Full-trip)
2009
Profit attributable to owners of the Company
(Year ended December 31) (RMB million)
2010
25,000
2011
2012
20,000
2013
2349
1,795
1,871
1,805
2014
15,000
1907
1,686
2015
10,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Ningbo-Jinhua Expressway, Jinhua Section
% change
y-o-y
2009
2010
2011
2012
2013
2014
Daily traffic volume during 2014
15,911
+17.6