Hong Kong, Nov 29, 2014 - (ACN Newswire) - Company Communication
Company IntroductionOur company is registered in Bermuda and incorporated as a limited liability entity in Hong Kong. The Shares of the company are listed on The Stock Exchange of Hong Kong Limited, and the stock code is 0922.HK. We are mainly engaged in the business of providing cemetery and funeral services in China. Our flagship asset Anxian Yuan cemetery, established in 1999, covers an area of 197.7 acres on a hillside 16 kilometers from downtown Hangzhou in Zhejiang Province.
The Group has branch offices in Beijing, Shanghai, Hangzhou, Guizhou and Hong Kong, but also has an equity investment in Hangzhou An Bai Shi E-Commerce Co., Ltd. The Hangzhou An Xian Yuan project covers 647,715 square meters. Hangzhou An Xian Yuan also owns joint cemetary land for development and management rights in Hebei Laishui, and 51% of the co-development rights in Guizhou Pan County and has a landbank available of more than 700,000 square meters for development as cemetaries.
Core Business:- Operation and management of cemeteries, burials, ash memorial storage, funeral services and sales of funeral-related products and services.- The Group has set up by a subsidiary, the "Paratown" funeral planning store, mainly engaged in planning funeral services, to further promote the development of funeral services and its own business in the Yangtze River Delta region of China in order to realize its long-term strategic business goals.
Nominations and ChangementsThe Board of Directors appoints Mr. Lai Chun Yu as the Independent Non-Executive Director of the company, and a member of the Audit Committee, Remuneration Committee and Nomination Committee on October 15, 2014.Mr. Lai Chun Yu, 37 years old, has been a member of CPA Australia since 2002, and a member of the Hong Kong Society of Accountants since 2004. He holds a Bachelor' of Commerce degree from Queensland University of Technology, and has more than 14 years of accounting, auditing and financial management experience. Mr. Lai served as a qualified accountant and company secretary for a Chinese computer-aided software solutions provider. In addition, he served as the Chief Financial Officer of Qin Jia Yuan Media Services Ltd., a company listed on the Stock Exchange of Hong Kong Limited ("Stock Exchange") He previously also worked for one of the four major international accounting firms.Mr. Lai is currently serving as Executive Director and Company Secretary at Amber Energy Limited (stock code: 90) listed on the Main Board of the Stock Exchange.
Mr. Li Xigang appoints as an independent non-executive directors and a member of the Audit committee the Remuneration Committee and the Nomination Committee with effect from October 15, 2014.Mr. Li Xigang, 52 years old, holds a master's degree in Management Engineering from Zhejiang University and a bachelor's degree from Xi'an Jiaotong University. In 1984 Lee joined the Hangzhou Oxygen Institute and engaged in design work. He subsequently worked in Jiang Xi Province Industrial and Commercial Trust & Investment Co., Ltd., Tian He Securities Limited and Baida Group Co., Ltd. At present, he has served as assistant to the chairman, and director of the Group's investment business in the West United Holdings Limited. Mr. Li has twenty years of business experience in trust, securities, banking and other financial institutions in China encompassing capital market acquisitions and mergers and acquisitions in the country with an extensive network of contacts.
Developments November 27, 2014In the interim results, profit attributable to owners skyrocketed to 5.748 million Hong Kong dollars, 5.84 times more than the same period last year.November 5, 2014Zhong Fu Park, an indirect wholly-owned subsidiary of Anxian Yuan China Holdings Limited, has acquired a stake in Hangzhou Hao Le Tian, for a total consideration of RMB7,700,000 (equivalent to approximately HK$9,771,574).June 27, 2014The annual report released recorded a profit for the full year.May 15, 2014Anxian Yuan (Shanghai), the wholly-owned subsidiary of Anxian Yuan China Holdings Limited, has signed a investment agreement with two independent third parties for the establishment of a joint venture to be mainly engaged in operation and management of cemeteries and funeral services in Pan County, Guizhou province, China.March 31, 2014The establishment of the operational headquarters for continental area projects in Hangzhou, China opened for service on March 25, It is mainly engaged in the development and management of cemeteries in China.March 3, 2014Anxian Yuan (Shanghai) Cemetery Investment Management Co., Ltd, a wholly-owned subsidiary of Anxian Yuan China Holdings Limited, has signed a investment agreement with Shanghai Liontown Hospital Logistics Management Co., Ltd.
Assets and Projects1. Zhejiang Anxian Yuan Cemetery Co., Ltd. covers an area of 197.7 acres with space for about 220,000 tombs available for sale. In 2014, the average price for one tomb is 62,000 RMB.The Anxian cemetery in Zhejiang has the biggest available area of any cemetery in Hangzhou and all of Zhejiang province. Hangzhou is located near the southeast coast of China, in northern Zhejiang province along the north bank of the lower reaches of the Qiantang River and south of the Beijing-Hangzhou Grand Canal. It is a port visa city as authorized by the Ministry of Public Security and one of China's top tourist destinations as determined by the National Tourism Administration. Since ancient times, it has enjoyed a reputation as a "paradise" and one of China's seven ancient capitals. It is also is among the first ranks of national historical and cultural cities and a key national tourist city. The Yuhang-Liangzhu Neolithic culture of 5,000 years ago is also recognized as "The Dawn of Civilization." This city has a history of more than 2,200 years dating from the Qin Dynasty. Five dynasties including the Southern Song Dynasty established their capitals here and Marco Polo, the Italian traveller, described it as "the most beautiful city in the world" during the Yuan Dynasty.At the end of 2012, Hangzhou's permanent resident population is 8.8 million, and rising by 64,000 year-on-year. The urban population is 6.54 million, accounting for 74.3% of the total. The household registration population by the public security department is 7 million, among which the agricultural population is 3.16 million and the non-agricultural population is 3.84 million. The city's birth rate is 11.08o/oo and the natural mortality rate is about 7o/oo. The annual death toll is more than 61,000 people and the rate of cremation is 100%.
2. A branch of Anxian Yuan (Shanghai) Cemetery Investment Management Co., Ltd was established near Beijing, principally to develop the cemetery business in Beijing and Hebei. The integration of the Beijing-Tianjin-Hebei area is an important social development strategy of China with its population rising to 107.7 million. This strategy can be seen in action in the new airport in Beijing located in Daxing county. In the future, aged-care institutions such as Beijing Hospital along with a population of 5 million will be moved to Baoding and other cities in Hebei. In addition some 13 counties in Hebei surrounding Beijing are expected to use the 010 area telephone code. The location of the Beijing branch cemetery project will also be covered.
3. Anxian Yuan Artistic Cemetery Co., Ltd. in Pan County, Guizhou covers an area of 62.9 acres. The cemetery and funeral home to be built covers 3.29 acres and the local average price for each tomb is 40,000 RMB. This project is near the original Shanghai-Kunming high-speed rail project at the West Garden Funeral Homes (and Cemetery) in Pan County. The total investment is expected to reach RMB200 million. The project has been officially approved by the responsible department of Guizhou Province to be built in a new construction area of about 63.09 acres about five miles away from the old one. The registration number of this approval certification is Qian Ming Han (2014) 101. The early stages of the design and construction preparation for this project has been progressing smoothly.
Pan County is located near the junction between Yunnan, Guizhou and Guangxi Provinces and is approximately 240 miles from Kunming and 282 miles from Guangxi. As the home of the world-famous ancient ginkgo tree, Pan County is one of the top three counties in terms of Guizhou's economy and the only one ranked among the top 100 nationwide counties (No.87 in 2013). It was cited as a "National Best Eco-tourism Demonstration County." The population of Pan County is 1.19 million. The latest population mortality rate is 0.7% with nearly 7,000 people passing away each year. Per capita consumption for funerals is RMB50,000 (including funeral activities and tomb).
The original West Garden Cemetery in Pan County is managed by a local private funeral enterprise with a capacity of 1,500 burials. These burials will be coordinated by the Government when the Pan Station on the Shanghai-Kunming high speed rail starts operation after the completion of the new cemetery garden. The burials will all be transferred to the new park. According to the latest update, the Shanghai-Hangzhou section of the Shanghai-Kunming Railway has been opened for service. The Shanghai-Changsha Railway will be available later in 2014, however the entire railway will not be fully operational until 2015 or 2016. The new cemetery project is the ideal combination of a peaceful cemetery and compassionate and comforting funeral services. According to the Government's planning, Anxian Yuan Artistic Cemetery Co., Ltd will be the only legally operating company offering cemetery and funeral services in Pan County upon completion.
4. Shanghai Liontown Hospital Logistics Management Co., Ltd. is one of the few firms performing professional management services and medical logistics support in this industry.Liontown's business focus is on hospitals, nursing homes, rest homes, physical examination clinics, and the demand of public health institutions. At present, with nearly 3,000 employees it has become a leading hospital logistics service outsourcing company in mainland China. Liontown provides integrated services to dozens of hospital customers, located in large and medium-sized cities, such as Shanghai, and Tianjin, and Zhejiang, Jiangsu, Hunan, Hebei, Anhui and other provinces. Shanghai Liontown Hospital Logistics Management Co., Ltd. serves the upstream segment for the funeral business, and is expected to create synergies with Anxian Yuan's funeral business development in mainland China.
5. Zhong Fu Park, an indirect wholly-owned subsidiary of Anxian Yuan China Holdings Limited, has acquired a stake in Hangzhou Hao Le Tian, for a total consideration of RMB7,700,000 (equivalent to approximately HK$ 9,771,574). Hao Le Tian Etiquette Services Limited mainly engaged in the provision of funeral services and the sale of funeral products. The Board considers that the Acquisition may provide an opportunity for the Group to broaden the scope of the funeral services it offers, and optimize the use of the Group's resources in order to seize the opportunities presented by the expansion of Chinese cemetery development, operation and management.
6. Anxian Yuan China with Hangzhou Hao Le Tian Etiquette Services Company and a wholly-owned subsidiary of An Xian Yuan (Shanghai) Cemetery have formed a joint venture investment management company in Hangzhou, An Bai Shi E-Commerce Co., Ltd. Its Shanghai flagship store (Paratown No.1) will commence trial operation on December 19, 2014. Paratown No.1 shop is located in the center of Shanghai, 500 meters away from the People's Square, with a high flow of traffic. Customers wanting personalized funeral services of Paratown No.1 can go directly to the Shanghai People's Square to arrange site visits and orders for the surrounding cemetery. In addition to customized client tomb sites outside, you can also draft and sign wills with the help of a lawyer, as well as arrange funeral services and funeral supplies to order. This package forms the "white matter" service business model to explore the next line of online customized services.
7. The long-term strategy of the company is to reserve 165-329 acres for burial areas for future use in first- and second-tier cities to tap the twin trends of an aging population and economic growth. These reserves would provide sufficient resources for the timely construction of funeral service facilities and funeral supplies according to changing conditions in the local funeral services market.
8. In the 2015/2015 interim results of Anxian Yuan China profit attributable to owners skyrocketed 585% to 5.748 million. Anxian Yuan plans to further promote the Yangtze River Delta Park Cemetery as it leads the funeral industry to build a new China O2O business model.Anxian Yuan China will hold the 2014/2015 Interim Results Conference at JW Marriott Hotel Hong Kong in the afternoon of 1 December. The company also plans some non-deal roadshows in Mainland China in Beijing, Shanghai, Shenzhen, Hangzhou and other places.
Marketing Trends Assessing market capacity in the funeral industry is a challenging task. According to statistical data in 2013, only estimates of operating income of the funeral homes and commercial cemeteries supervised by the Civil Administration Department are available.
Only 10%-20% of cremated remains are placed in columbaria every year. The rest are placed in ash containers presented directly to survivors of the deceased. The average estimates of the number of the burials in 2012 and 2013 extrapolated from the average growth rate are 5.24 million and 6.50 million respectively.
By analyzing industry revenue data in conjunction with cremation and burial statistics in 2007 and 2008, we found that the average cremation and burial costs only RMB500-700, indicating a big gap with the actual consumption price. Therefore, we have re-estimated the industry revenues in 2007-2013.
The funeral industry market capacity in 2013 was estimated to range from RMB40-60 billion considering cremation, and especially the increasing burial volume. The market capacity for funeral homes would have accounted for around RMB9-15 billion of this total and for cemeteries, the market capacity is around RMB32-45 billion.
Anxian Yuan China Holdings LimitedMiss Jessica LiuInvestor Relations(Chinese Supervisor)Tel: (861 571) 88381293Fax: (861 571) 88376670Email: axy@anxianyuanchina.com
Miss Nikki GanInvestor Relations (English Supervisor)Tel: (861 571) 88381293Fax: (861 571) 88376670Email: axy@anxianyuanchina.com
Strategic Financial Relations (China) LimitedNan DongSenior Vice PresidentTel: (852) 2864 4811Fax: (852) 2527 1271Email: sprg-anxianyuan@sprg.com.hk
Source: Anxian Yuan China Holdings Limited
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