Propelling Forward - listed companycrct.listedcompany.com/misc/CRCT_Annual_Report_2013.pdf · Propelling Forward CRCT is driven to deliver sustainable and increasing ... Sephora,

Propelling Forward

CapitaRetail China TrustAnnual Report 2013

Actual Text

Clarity Clarity enables us to enhance organisational performance through operational excellence and efficiencies.

Propelling ForwardCRCT is driven to deliver sustainable and increasing returns to our Unitholders. The balanced portfolio of quality shopping malls in major cities across China gives resilience, stability and growth to our performance. With our expertise in proactive mall management, asset enhancement and focus on yield-accretive acquisitions, we continue to unlock the values of our assets and bring the business to the next level.

Contents Corporate Profile 02Financial Highlights 04Letter to Unitholders 08 Corporate Governance & Sustainability Trust Structure 14Organisation Structure 15Year in Brief 16Board of Directors 17Trust Management Team 24Corporate Governance 25Enterprise Risk Management 40Investor & Media Relations 42Unit Price Performance 44Corporate Social Responsibility 46People & Talent Management 47 Business ReviewGrowth Strategies 48Operations Review 49Financial Review 55Capital Management 58

Portfolio Details Portfolio Summary 62Portfolio Details 64 Financial Statements Report of the Trustee 82Statement by The Manager 83Independent Auditors’ Report 84Statements of Financial Position 85Statements of Total Return 86Distribution Statements 87Statements of Movements in

Unitholders’ Funds 89Portfolio Statement 90Consolidated Statement of

Cash Flows 92Notes to the

Financial Statements 94

AppendixInterested Person Transactions 145Unitholders’ Statistics 146Mall Directory 148Corporate Information

2 Clarity CapitaRetail China Trust Annual Report 2013

Corporate Profile

Deliver sustainable income growth to our Unitholders and value add to the community and stakeholders by enhancing organic growth through proactive asset management; creating new value through innovative asset enhancement strategies; and capitalising on yield-accretive acquisitions growth.

Mission

Sustainable and resilient REIT with a professionally managed portfolio of quality retail real estate across China.

VisionFirsT And only ChinA shopping mAll reAl esTATe invesTmenT TrusT in singAporeCapitaRetail China Trust (CRCT) is the first and only People’s Republic of China shopping mall real estate investment trust (REIT) in Singapore, with a portfolio of 10 income-producing shopping malls. Listed on the Singapore Exchange Securities Trading Limited (SGX-ST) on 8 December 2006, it is established with the objective of investing on a long-term basis in a diversified portfolio of income-producing real estate used primarily for retail purposes and located primarily in China, Hong Kong and Macau.

The geographically diversified portfolio of quality shopping malls is located in six of China’s cities. The malls are CapitaMall Xizhimen, CapitaMall Wangjing, CapitaMall Grand Canyon, CapitaMall Shuangjing and CapitaMall Anzhen in Beijing; CapitaMall Qibao in Shanghai; CapitaMall Erqi in Zhengzhou, Henan Province; CapitaMall Saihan in Huhhot, Inner Mongolia; CapitaMall Wuhu in Wuhu, Anhui Province; and CapitaMall Minzhongleyuan in Wuhan, Hubei Province.

All the malls in the portfolio are positioned as one-stop family-oriented shopping, dining and entertainment destinations for the sizeable population catchment areas in which they are located, and are accessible via major transportation routes or access points. A significant portion of the properties’ tenancies consists of major international and domestic retailers such as Wal-Mart, Carrefour and the Beijing Hualian Group (BHG) under master leases or long-term leases, which provide CRCT unitholders with stable and sustainable returns. The anchor tenants are complemented by popular specialty brands such as UNIQLO, ZARA, Vero Moda, Sephora, Watsons, KFC, Pizza Hut and BreadTalk.

CRCT is managed by an external manager, CapitaRetail China Trust Management Limited (CRCTML or the Manager), which is an indirect wholly-owned subsidiary of CapitaMalls Asia Limited, one of Asia’s largest listed shopping mall developers, owners and managers.

CapitaMall Wangjing, Beijing

3

BeijingCapitaMall XizhimenCapitaMall WangjingCapitaMall Grand CanyonCapitaMall AnzhenCapitaMall Shuangjing

ShanghaiCapitaMall Qibao

ZhengzhouCapitaMall Erqi

WuhuCapitaMall Wuhu

WuhanCapitaMall Minzhongleyuan

HuhhotCapitaMall Saihan


20112009 2010 2012 2013

9.54

8.14 8.368.70 9.02

FinancialHighlights

perFormAnCe AT A glAnCe

neT properTy inCome (S$ million)

disTribuTAble inCome (S$ million)

gross revenue (S$ million)

neT AsseT vAlue per uniT (S$)

disTribuTion per uniT (¢)

20112009 2010 2012 2013

152.5

120.3 119.0131.9

160.1

20112009 2010 2012 2013

99.7

77.1 77.285.8

103.0

20112009 2010 2012 2013

1.31

1.091.17

1.33

1.48

20112009 2010 2012 2013

66.8

50.6 52.257.2

70.1

Management Reports

5

2013 1 2012 1 2011 1 2010 1 2009 1

Balance Sheet (as at 31 December)Total Assets (S$’000) 2,184,291 1,648,791 1,536,268 1,274,478 1,200,980

Total Deposited Properties 2 (S$’000) 2,155,554 1,623,824 1,482,001 1,229,196 1,159,778

Net Assets Attributable to Unitholders (S$’000) 1,186,951 978,742 913,839 734,507 679,868

Total Borrowings (S$’000) 713,458 465,847 433,048 401,958 406,399

Market Capitalisation (S$ million) 1,068 1,232 792 775 797 Net Asset Value Per Unit (S$) 1.48 1.31 1.33 1.17 1.09

Portfolio Property Valuation (S$’000) 2,058,094 3 1,476,988 1,440,620 1,215,089 1,156,614

Financial Ratios (as at 31 December)Earnings Per Unit (¢) 17.52 19.52 4 18.22 17.84 6.88

Distribution Per Unit (¢) 9.02 9.54 8.70 8.36 8.14

Net Tangible Assets Per Unit (S$) 1.48 1.31 1.33 1.17 1.09

Gearing Ratio 5 (%) 32.6 28.0 28.0 31.1 33.6

Interest Cover (times) 8.5 8.5 7.3 6.2 8.0 Management Expense Ratio 6 (%) 0.9 1.0 0.9 1.0 1.1

2013 1

Financial Derivatives (as at 31 December)Net Fair Value of Financial Derivatives 7 (S$ million) (3.2)

Proportion of Financial Derivatives to Net Assets Attributable to Unitholders (%) (0.3)

1 The financial year from 1 January to 31 December.2 All the assets of CRCT (or proportional share if CRCT owns less than 100% of a Barbados Company as defined in the CRCT Prospectus dated

29 November 2006 (CRCT Prospectus) and/or a Project Company (as defined in the CRCT Prospectus)) including the properties and all the authorised investment of CRCT for the time being held or deemed to be held upon the trusts under the trust deed dated 23 October 2006 as amended by the First Supplemental Deed dated 8 November 2006, Second Supplemental Deed dated 15 April 2010, Third Supplemental Deed dated 5 April 2012 and Fourth Supplemental Deed dated 14 February 2014 (collectively, the Trust Deed), and excluding income to be distributed after the year end.

3 Based on valuation as at 31 December 2013. The valuation of CapitaMall Anzhen, CapitaMall Shuangjing, CapitaMall Qibao, CapitaMall Saihan and CapitaMall Wuhu were conducted by CBRE Pte. Ltd. (CBRE), while the valuation for CapitaMall Xizhimen, CapitaMall Wangjing, CapitaMall Erqi and CapitaMall Minzhongleyuan were conducted by Colliers International (Hong Kong) Limited (Colliers) as at 31 December 2013. CapitaMall Grand Canyon valuation as at 31 December 2013 was based on management valuation as the acquisition of the mall was completed on 30 December 2013. Portfolio property valuation include the valuation of the 10 retail malls and the carrying amount of CapitaMall Minzhongleyuan’s three residential units.

4 The figure has been restated for the effect of preferential offering completed on 20 November 2013.5 The gearing is calculated based on total outstanding debts over the total assets. Total assets included the hedging effects on the net assets denominated

in Renminbi (RMB).6 Refers to the expenses of CRCT excluding property expenses and interest expenses but including performance component of CRCTML’s management

fees, expressed as a percentage of weighted average net assets.7 Financial derivatives include non-deliverable forwards and interest rate swaps which CRCT has entered into as a form of hedging against the underlying

foreign currency and interest rate risks. The net fair value derivative represented a negative 0.3% over the net assets of CRCT as at 31 December 2013.

2

3

CRCT PResenCe in beijing1 CapitaMall Xizhimen2 CapitaMall Anzhen3 CapitaMall Wangjing4 CapitaMall Grand Canyon5 CapitaMall Shuangjing

1

4

5

Leveraging on our financial capacity, we continue to add impetus to our growth engine through enhancing our malls and acquiring quality assets.

Strengthening Foothold


Letter to Unitholders

We enter 2014 on a strong footing. With contributions from CapitaMall Grand Canyon, and a further uplift from the reopening of CapitaMall Minzhongleyuan in the second quarter after its major enhancement works, we are confident 2014 will be another year of solid performance.

(Left) Liew Cheng San Victor, Chairman | (Right) Tony Tan Tee Hieong, Chief Executive Officer

Management Reports

9

dear unitholders,

On behalf of the Board of Directors of the Manager, we are pleased to present the Annual Report for the financial year ended 31 December 2013 (FY 2013).

Through disciplined execution of our three-pronged growth strategy, we have delivered yet another year of strong performance.

delivering susTAinAble And resilienT growThFor FY 2013, gross revenue grew 3.5% year-on-year to RMB795.0 million and net property income increased 2.0% year-on-year to RMB511.7 million. Excluding CapitaMall Minzhongleyuan which was closed in July 2013 for asset enhancement works, our gross revenue grew 7.6% and net property income 7.0% year-on-year.

During the year, total distributable income increased 4.9% year-on-year to S$70.1 million. We made a distribution of 4.69 cents per unit to our Unitholders in September 2013 and will be distributing 4.33 cents per unit in March 2014. Total distribution per unit is 9.02 cents for FY 2013. Based on CRCT’s closing price of S$1.33 on 31 December 2013, our distribution yield was 6.8%.

By keeping abreast of the ever-changing consumer needs and taking a proactive approach to adjusting our tenant mix, our malls continue to attract strong following from both shoppers and retailers. In the year under review, we achieved an outstanding performance with tenants’ sales and shopper traffic growth of 9.2%1 and 5.4%1 respectively on a year-on-year basis. A total of 5642 leases were renewed during the year at an

average increase of 13.8%2 over the preceding rentals. Our committed occupancy was maintained at a high rate of 98.2%. Valuation of our malls as at December 2013 was RMB10.1 billion, 7.3%2 higher than the previous year.

building For The FuTureWe constantly look for creative ways to unlock the value of our malls and to deliver growth. An example of such efforts was the transformation of CapitaMall Saihan from a master-leased to multi-tenanted mall. We recovered space from our master lessee and reconfigured it before re-leasing to the specialty tenants. The extensive asset enhancement works were completed in late 2009, turning the mall into a leading shopping, dining and entertainment destination in Inner Mongolia. Since the completion of the renovation, the mall has increased its gross revenue by 111.3%, from RMB23.4 million in 2010 to RMB49.5 million in 2013. Net property income has also grown 238.4%, from RMB7.6 million in 2010 to RMB25.7 million in 2013.

With the same objectives in mind, we embarked upon a major initiative to transform CapitaMall Minzhongleyuan in Wuhan into a unique shopping destination. CapitaMall Minzhongleyuan is a charming heritage building that was completed around 1920, with an extension block constructed in 1997. It has a long history of being a cultural and performance centre before it was converted to a shopping mall. The major uplift will boost the overall appeal as we upgrade the facilities, improve the layout and refresh the tenant mix.

The asset enhancement works have commenced in July 2013 and the mall is slated to reopen in the

Excluding CapitaMall Minzhongleyuan which was closed in July 2013 for asset enhancement works, our gross revenue grew 7.6%.

Gross RevenueRMB795.0m


Distributable income grew 4.9% year-on-year.

Distributable IncomeS$70.1m

second quarter of 2014. We have since received strong interest from retailers. As at 31 December 2013, more than 70.0% of the net lettable area has been secured or are in advanced negotiations. We will continue to engage prospective tenants and look forward to a good reopening. With its unique building façade and revamped interior, we believe CapitaMall Minzhongleyuan will once again become an iconic shopping destination in Wuhan.

In July 2013, we announced the proposed acquisition of our tenth mall, CapitaMall Grand Canyon (previously known as Grand Canyon Mall) in Beijing. This quality addition will further strengthen our market presence in the capital city.

Strategically located in the Fengtai district in the up-and-coming south region of Beijing, CapitaMall Grand Canyon is a pioneer shopping destination in the region. Fronting the busy South Third Ring West road, this leading shopping mall has excellent connectivity to various modes of public transport. The mall is a 5-minute walk from the nearest subway station serving the north-south main line, and is accessible by more than 40 bus services. The major terminal for high-speed trains, the Beijing South Railway Station, is only one subway stop away. Since its opening in August 2010, CapitaMall Grand Canyon has established its presence within the local community with a steady monthly footfall of over 1 million.

Positioned as a one-stop shopping mall, CapitaMall Grand Canyon houses many popular brands such as Sephora, H&M, Poly Cinema and Carrefour. Since the announcement of the proposed acquisition in July 2013, we have been co-managing

the mall with the vendor. Through our extensive leasing network, we were able to achieve a higher committed occupancy rate of 95.9% by December 2013, from 92.7% in April 2013. Compared to preceding leases, newly committed rentals increased more than 100%. The acquisition was completed in December 2013, and the mall will start contributing to CRCT in 2014.

sTrATegiC CApiTAl mAnAgemenTWe established the Distribution Reinvestment Plan (DRP) in March 2013 to provide our Unitholders with an option to receive their distributions in units instead of cash. In August 2013, we offered DRP for the first time for the distribution for January 2013 to June 2013. We received generous support from our Unitholders, with 24.8% participation.

In November 2013, we launched our first non-renounceable preferential offering and successfully raised S$59.0 million. Based on the total number of 45,413,704 new units issued, the preferential offering was 1.8 times subscribed. We are grateful to our Unitholders for the confidence and support.

As at 31 December 2013, CRCT’s total borrowings were S$713.5 million and gearing was at 32.6%. We refinanced the S$150.5 million that was due in June 2013 with extended maturity to 2016 and beyond. We have extended our average term to maturity from 1.39 years at the beginning of the year to 2.38 years. 61% of our borrowings are fixed, with an average cost of debt of 2.6%.

giving bACk To The CommuniTyCRCT is committed to being a responsible corporate citizen, and we continue to support charitable

Letter to Unitholders

Management Reports

11

causes and adopt green initiatives that will contribute to building a sustainable future for the generations to come.

In September 2013, we took part in CapitaMalls Asia’s signature annual corporate social responsibility programme, “My Schoolbag” for the fourth consecutive year. Staff volunteers from six of our malls – CapitaMall Xizhimen, CapitaMall Wangjing, CapitaMall Minzhongleyuan, CapitaMall Qibao, CapitaMall Saihan and CapitaMall Wuhu – distributed new schoolbags and stationery to underprivileged first grade students.

CapitaMall Xizhimen worked together with the International Fund for Animal Welfare to organise an exhibition on the plight of wild animals at risk of extinction from excessive hunting. A special performance was also held to celebrate the achievements of the visually impaired or blind. In addition, CapitaMall Wuhu hosted 30 underprivileged children for a fun-filled day at the mall during Mid-Autumn Festival.

We remain committed to protecting our environment by engaging our stakeholders in a wide range of green activities.

Six of our malls – CapitaMall Xizhimen, CapitaMall Wangjing, CapitaMall Minzhongleyuan, CapitaMall Qibao, CapitaMall Saihan and CapitaMall Wuhu – turned off their façade and non-essential lights for 10 hours from 8.30 pm on 23 March 2013 to support Earth Hour. In addition, we held other

activities to raise awareness of green initiatives. CapitaMall Xizhimen held “live” unplugged musical performances and an eco knowledge quiz, while CapitaMall Wuhu organised a competition for children to use recycled objects to create eco-friendly artworks. CapitaMall Saihan set up an event for shoppers to swap their pre-loved items with other shoppers, and held a mass cycling event to promote cycling as a healthy and green form of transport. On a longer-term basis, CapitaMall Qibao set up a small farm on its roof to cultivate respect and love for nature among children growing up in the city.

propelling ForwArdDespite an uncertain global economic environment, China achieved GDP growth of 7.7%3 in 2013 – higher than the official target of 7.5%. Retail sales also increased by 13.1%3 year-on-year to RMB23.4 trillion3. China forecast 2014 GDP growth to be 7.5%4.

The Chinese government reaffirmed its plans to boost domestic employment, improve public services and invest in urban infrastructure projects in an effort to stimulate consumption to drive economic growth. Prudent economic and monetary policies will be implemented and efforts to support economic reforms will also be stepped up. We are positive that CRCT is in an advantageous position to benefit from the consumption driven economy.

We enter 2014 on a strong footing. With contributions from CapitaMall Grand Canyon and a further uplift

from the reopening of CapitaMall Minzhongleyuan in the second quarter after its major enhancement works, we are confident 2014 will be another year of solid performance.

ACknowledgemenTsWe wish to thank our Board of Directors for their contributions and commitments. Ms Chew Gek Khim, who has been with us since the Initial Public Offering of CRCT in 2006, stepped down on 5 February 2014. We are grateful for her guidance and dedication over the past seven years, and wish her well in her future endeavours.

We welcome Mr Christopher Gee Kok Aun, who joined us on 24 January 2014. His experience and expertise will be invaluable to the Board.

Finally, on behalf of the Board of Directors and management, we wish to express our appreciation to our shoppers, customers, tenants, business partners and staff for your contributions in 2013. Most importantly, we would like to express our utmost gratitude to our supportive Unitholders. We remain committed to deliver better returns and look forward to your continued support.

liew Cheng sAn viCTorChairman

Tony TAn Tee hieong Chief Executive Officer

26 February 2014

1 Only includes shoppers at multi-tenanted malls except CapitaMall Minzhongleyuan, which is undergoing asset enhancement works and CapitaMall Grand Canyon as the acquisition was completed on 30 December 2013.

2 Excluding CapitaMall Grand Canyon as the acquisition was completed on 30 December 2013.3 Source: National Bureau of Statistics of China.4 Source: The Chinese Academy of Social Sciences.


尊敬的单位持有人，

我们谨代表管理人董事会呈报截至2013年12月31日财政年度（2013财年）的致单位持有人报告。

通过有纪律地执行我们三管齐下的发展策略，我们于2013财年再次录得强劲的业绩。

实现可持续和具韧性的增长2013财年，总收入同比去年增长3.5%，达795.0百万人民币，净物业收入同比去年增长2.0%，达511.7百万人民币。若不包括于2013年7月关闭以进行资产改良的新民众乐园，我们的总收入和净物业收入分别同比去年增长7.6%和7.0%。

年内，总可派发收入同比去年增加4.9%，达70.1百万新元。我们在2013年9月向单位持有人按每单位派发4.69新分，并在 2014年3月按每单位派发4.33新分。2013 财年的每单位派发金总额为9 .02新分。按2013年12月31日的闭市价1.33新元计算，我们的派息率为6.8%。

通过紧贴千变万化的消费潮流和积极调整我们的租户组合，我们的购物中心继续受到购物者和零售商的欢迎。2013财年，我们取得了出色的业绩，租户销售额和客流分别同比去年增长9.2%1和5.4%1。年内我们一共重续了5642 份租约，相比上个租约，平均租金增加13.8%2。我们的承诺出租率保持在98.2%的高水平。我们购物中心于2013年12月的估值为101亿人民币，较去年上升7.3%2。

建设未来我们不断寻求创新方式释放我们购物中心的价值，并实现增长。例如从整租购物中心转型成为多租户购物中心的凯德MALL • 赛罕。我们从整租的租户收回店面，并在改造后重

新租给多家经营专卖店的租户。我们于2009年底完成大规模的资产改良工程，将购物中心打造成內蒙古地区领先的购物、餐饮和娱乐中心。自改建后，购物中心的总收入由2010年的23.4百万人民币增长111.3%，达到2013年的49.5百万人民币。净物业收入也从2010年的7.6百万人民币增长238.4%，达到2013年的25.7百万人民币。

秉着同样的目标，我们开始着手另一项重大的工程，将武汉新民众乐园改造为一个独特的购物中心。充满魅力的新民众乐园是在1920年前后竣工的文物建筑，并在1997年进行扩建。在改造成购物中心之前，新民众乐园长期作为文化表演中心。此次的改良工程，将通过提升项目的设施、改善布局、更新租户组合，进一步加强购物中心整体的吸引力。

资产改良工程在2013年7月启动，购物中心预计将于2014年第二季度重新开业。许多零售商已对项目表达了浓厚的兴趣。截至2013年12月31日，超过70.0%的净出租面积已经出租或正在进行最后阶段的商谈。我们会继续接洽潜在租户，并期待购物中心的成功开业。凭借其独特的建筑外观和更新后的内部装潢，我们相信新民众乐园会再次成为武汉标志性的购物地点。

2 0 1 3 年 7月，我们宣布计划收购我们的第十家购物中心，即位于北京的凯德MALL • 大峡谷（前称首地大峡谷购物中心）。这个高品质的购物中心会进一步巩固我们在中国首都的市场地位。

凯德MALL • 大峡谷地理位置优越，坐落在快速发展的北京南部的丰台区，是该地区领先的购物中心。购物中心面向繁忙的南三环西路，连接多项主要道路和交通服务，交通十分便利。它距离服务南北城主要铁路最近的地铁站仅5分钟步行路程，途经项目的巴士服务多达40个以上。高铁的

我们以强劲的立足点迈入2014年。随着凯德MALL • 大峡谷开始贡献收入，加上新民众乐园完成大规模改良工程后于第二季度重新开业，我们有信心在2014年取得另一次的强劲业绩表现。

795.0百万人民币

若不包括于2013年7月关

闭以进行资产改良的新

民众乐园，总收入同比

去年增长7.6%。

总收入

70.1百万新元

可派发收入同比去年增加

4.9%。

可派发收入

Management Reports

13

1 仅包括多租户购物中心（不包括新民众乐园和凯德MALL • 大峡谷，前者正在进行资产改良工程，后者于2013年12月30日完成收购）的购物者。2 不包括凯德MALL • 大峡谷，其于2013年12月30日完成收购。3 资料来源：中国国家统计局4 资料来源：中国社会科学院

主要始发和终点站北京南站距离购物中心仅一个地铁站。自2010年8月开业以来，凯德MALL • 大峡谷已在当地社区建立了市场地位，每月拥有逾百万的稳定客流。

凯德MALL • 大峡谷定位为一站式购物中心，拥有多个受欢迎的品牌，如丝芙兰、H&M、保利影城和家乐福等。自2013年7月宣布计划收购以来，我们便与卖方共同管理购物中心。通过我们雄厚的租赁网络，我们在2013年12月底实现了95.9%的承诺出租率，高于2013年4月的92.7%。相较于之前的租约，新的承诺租金增加100%以上。收购已于2013年12月完成，购物中心会在2014年开始为凯德商用中国信托贡献收入。

战略资本管理我们在本年度3月设立了配售再投资计划，赋予我们的单位持有人权利，选择以信托单位而非现金的方式收取派发金。2013年8月，我们就2013年1月至2013年6月的可派发收入，首次推出配售再投资计划。计划获得了单位持有人的大力支持，参与度高达24.8%。

2013年11月，我们首次推出了不可放弃优先发售计划，并成功筹得59.0百万新元。按总发行45,413,704个新单位计算，优先发售获认购1.8倍。我们感谢单位持有人对我们的信心和支持。

于2013年12月31日，我们的总借款为713.5 百万新元，而负债比率则为32.6%。我们通过再融资获得150.5百万新元，该笔款项于2013年6月到期，并获延期至2016年及之后。我们已将平均期限由年初的1.39年延长至2.38年。我们的借款中有61%为定息借款，平均债务成本为2.6%。

回馈社会我们致力于履行作为企业公民的责任，继续支持慈善事业并采取绿色行动，为后代推动可持续发展的未来。

2013年9月，我们连续第四年参与凯德商用名为“我的书包”的标志性年度大型企业社会责任项目。我们的六家购物中心（凯德 MALL • 西直门、凯德MALL • 望京、新民众乐园、凯德七宝购物广场、凯德MALL • 赛罕及凯德广场 • 芜湖）的员工参与了此活动，向一年级的弱势学生捐赠新书包及文具。

凯德MALL • 西直门与国际爱护动物基金会合作举办展览，让公众更了解因过度猎捕而濒临灭绝的野生动物的困境。该购物中心也举办特别表演，正面肯定视力受损者或失明者的成就。此外，凯德广场 • 芜湖在中秋节接待30名弱势儿童，让他们在购物中心内度过欢快的一天。

我们继续致力于保护我们的环境，通过广泛的绿色活动与利益相关者互动。

我们的六家购物中心（凯德MALL • 西直门、凯德MALL • 望京、新民众乐园、凯德七宝购物广场、凯德MALL • 赛罕及凯德广场 • 芜湖）在2013年3月23日从晚上8点30分起关闭购物中心外墙灯和非主要的照明灯十小时，以示对地球一小时活动的支持。此外，我们举办其他活动以提高大众对绿色行动的意识。凯德MALL • 西直门举办现场不插电音乐表演及生态知识问答竞赛，而凯德广场 • 芜湖为儿童举办利用回收物制成艺术品的环保比赛。凯德MALL • 赛罕举办活动供购物者交换二手物品，也通过大型单车活动倡导将单车作为一项健康及环保的交通工具。在较长期活动方面，凯德七宝购物广场开辟小型的屋顶农场以培养在城市长大的儿童对大自然的尊重和喜爱。

向前推进尽管全球经济环境不明朗，中国的国内生产总值在2013年仍然取得7.7%3的增长，高于7.5%的官方目标。零售销售额也同比去年增长13.1%3至23.4万亿人民币3。中国预测2014年的国内生产总值将会增长7.5%4。中国政府重申其促进国内就业、改善公共

服务及投资城市基础设施项目的计划，旨在刺激消费以推动经济增长。中国将实施审慎的经济及货币政策，也将加大力度支持经济改革。我们相信凯德商用中国信托处于有利的位置，将从消费推动型的经济体中受益。

我们以强劲的立足点迈入2014年。随着凯德MALL • 大峡谷开始贡献收入，加上新民众乐园完成大规模改良工程后于第二季度重新开业，我们有信心在2014年取得另一次的强劲业绩表现。

致谢我们谨此就董事会的贡献及努力向他们致谢。自2006年凯德商用中国信托上市以来便出任董事的周玉琴女士于2014年2月5日卸任。我们为她在过去七年来的指导及贡献表示感谢，并祝愿她前程锦绣。

我们谨此欢迎余国安先生于2014年1月24日加入董事会。他的经验及专长对董事会将极为宝贵。

最后，我们谨此代表董事会及管理层对我们的购物者、顾客、租户、业务伙伴及员工于2013年作出的贡献表示感激。我们更感谢各位单位持有人的支持。我们将继续致力于实现更佳回报并期待获得您的持续支持。

廖青山

主席

陈智雄首席执行官

2014年2月26日


Trust Structure

Singapore

Singapore

China

Barbados

Management Services

Trustee Fees

Management Fees

Acts on behalf of Unitholders

Holding of Units Distributions

The ManagerCapitaRetail China Trust

Management Limited

The TrusteeHSBC Institutional

Trust Services (Singapore) Limited

Unitholders

Proportionate Shareof Dividends, InterestIncome and PrincipalRepayment ofShareholder’s Loans

Dividends

Dividends100% Ownership and Shareholder’s Loans

Property Manager’s Fees

Property Management Services

100% Ownership and Shareholder’s Loans

Dividends, Interest Income and Principal Repayment of Shareholder’s Loans

Dividends, Interest Income and Principal Repayment of Shareholder’s Loans

Ownership and Shareholder’s Loans Ownership and Shareholder’s Loans

OwnershipNet Property Income

Net Property Income

Ownership

Property Management Services

Property Manager’s Fees

51.0% Ownership and Shareholder’sLoans

Project Companies

Project Company

CapitaMall Wuhu

Singapore Companies

Barbados Companies

Properties(Excluding

CapitaMall Wuhu)

The PropertyManagers

The PropertyManager

Corporate Governance & Sustainability

15

OrganisationStructure

The Manager CapitaRetail China Trust Management Limited

BoaRD oF DIReCToRS

ChIeF exeCUTIve oFFICeR

aUDIT CoMMITTee

FInanCe TeaM

InveSTMenT anD aSSeT

ManaGeMenT TeaM

InveSToR RelaTIonS TeaM


FeBRUaRY– Distributable

income of S$66.8 million for the financial year ended 2012 was 16.8% higher than the previous year. Distribution per unit for financial year ended 2012 was 9.54 cents, highest achieved since IPO.

jUlY– CapitaMall

Minzhongleyuan officially closed for asset enhancement works.

– Announced the proposed acquisition of CapitaMall Grand Canyon in south of Beijing, China.

– Net property income increased 6.2% and distributable income grew 7.5% year-on-year in 2Q 2013.

Year in Brief

aPRIl– Net property

income grew 4.6% and distributable income 4.2% year-on-year for 1Q 2013.

– Held its annual general meeting with all the resolutions duly passed.

SePTeMBeR– Paid a

distribution per unit of 4.69 cents to Unitholders for the period 1 January 2013 to 30 June 2013. Unitholders are given the option to apply for DRP for the first time for this distribution.

MaRCh– Established

Distribution Reinvestment Plan (DRP), to encourage current Unitholders to increase their unitholdings in CRCT without incurring brokerage fees, stamp duties (if any) and other related costs.

– Paid a distribution per unit of 1.50 cents to Unitholders for the period 2 November 2012 to 31 December 2012.

oCToBeR– 3Q 2013

distributable income increased 2.1% year-on-year despite the closure of CapitaMall Minzhongleyuan for asset enhancement.

DeCeMBeR– Completed

acquisition of CapitaMall Grand Canyon.

2013

noveMBeR– Launched

preferential offering which was subscribed 1.8 times and successfully raised S$59.0 million for the acquisition of CapitaMall Grand Canyon.


17

Liew Cheng San Victor, 67Chairmanindependent non-executive directorBachelor of Social Sciences (Honours), University of Singapore

Date of first appointment as a director: 31 October 2006length of service as a director (as at 31 December 2013): 7 years 2 months

board committee served on– Corporate Disclosure Committee (Chairman)

present principal commitments (other than directorships in listed companies)– Accuron Technologies Limited (Director)– Catalist Advisory Panel (Member)– Singapore Aerospace Manufacturing Private Limited

(Director)– Singapore Institute of Management (Member, Governing

Council, Chairman, Investment Committee and Member, Audit Committee)

– Singapore Institute of Management Pte. Ltd. (Director)

background and working experience– Temasek Holdings (Private) Limited (Corporate Advisor from

2004 to June 2011)– Singapore Technologies Pte Ltd (Corporate Advisor from

February 2002 to 2004)– Overseas Union Bank Limited (from 1980 to 2002 (Executive

Vice President of Global Markets and Treasury))

Award– Public Service Star (2000)

Board ofDirectors


Board ofDirectors

Lim Ming Yan, 51deputy Chairmannon-independent non-executive directorBachelor of Engineering (Mechanical) and Economics (First Class Honours),

University of Birmingham, UK

Date of first appointment as a director: 1 January 2013length of service as a director (as at 31 December 2013): 1 year

board committees served on– Corporate Disclosure Committee (Member)– Executive Committee (Chairman)

present directorships in other listed companies– Ascott Residence Trust Management Limited

(manager of Ascott Residence Trust) (Deputy Chairman)– CapitaCommercial Trust Management Limited

(manager of CapitaCommercial Trust) (Deputy Chairman)– CapitaLand Limited– CapitaMall Trust Management Limited

(manager of CapitaMall Trust) (Deputy Chairman)– CapitaMalls Asia Limited– Central China Real Estate Limited

present principal commitments (other than directorships in listed companies)– Building and Construction Authority (Board Member)– Business China (Director)– CapitaLand China Holdings Pte Ltd (Chairman)– CapitaLand Limited

(President & Group Chief Executive Officer)– CapitaLand Hope Foundation (Director)– CapitaLand Malaysia Pte. Ltd. (Chairman)– CapitaLand Singapore Limited (Chairman)– CTM Property Trust, Steering Committee (Chairman)– LFIE Holding Limited (Co-Chairman)– Shanghai YiDian Holding (Group) Company (Director)– Singapore Tourism Board (Board Member)– The Ascott Limited (Chairman)

directorship in other listed companies held over the preceding three years– Lai Fung Holdings Limited

background and working experience– Chief Operating Officer of CapitaLand Limited

(From May 2011 to December 2012)– CEO of The Ascott Limited

(From July 2009 to February 2012) – CEO of CapitaLand China Holdings Pte Ltd

(From July 2000 to June 2009)

Awards– Outstanding CEO (Overseas) in the Singapore Business

Awards 2006– Magnolia Award by the Shanghai Municipal Government in

2003 and 2005


19

Chew Gek Khim, 52independent non-executive director1

Bachelor of Laws (Honours), National University of Singapore

Date of first appointment as a director: 31 October 2006length of service as a director (as at 31 December 2013): 7 years 2 months

board committee served on– Audit Committee (Chairperson)

present directorships in other listed companies– ARA Asset Management Limited– ARA Trust Management (Suntec) Limited

(manager of Suntec Real Estate Investment Trust)– Singapore Exchange Limited– The Straits Trading Company Limited (Executive Chairman)

present principal commitments (other than directorships in listed companies)– National Environment Agency Board (Chairman)– S. Rajaratnam School of International Studies

(Member, Board of Governors)– Securities Industry Council (Member)– Singapore Symphony Orchestra Council (Member)– Tecity Group (Executive Chairman)– The Straits Trading Company Limited (Executive Chairman)– The Tan Chin Tuan Foundation, Singapore

(Deputy Chairman)– The Tan Sri Tan Foundation, Malaysia (Chairman)

background and working experience– Advocate and Solicitor, Supreme Court of Singapore (1985)

Award– Chevalier de l’Ordre National du Mérite (2010)

1 Ms Chew Gek Khim resigned as an Independent Non-Executive Director and ceased to be the Chairperson of the Audit Committee with effect from 5 February 2014.


Fong Heng Boo, 64independent non-executive directorBachelor of Accountancy (Honours), University of SingaporeFellow, Institute of Singapore Chartered Accountants

Date of first appointment as a director: 1 January 2013length of service as a director (as at 31 December 2013): 1 year

board committee served on– Audit Committee (Member)1

present directorships in other listed companies– Asian American Medical Group Limited– Colex Holdings Limited– Pteris Global Limited– Sapphire Corporation Limited

present principal commitments (other than directorships in listed companies)– CapitaLand Township Holdings Pte. Ltd. (Director)– Certis CISCO Security Pte. Ltd. (Director)– Council for Estate Agencies (Member, Licensing & Practice

Committee and Member, Audit Committee)– Eastern Health Alliance Pte. Ltd. (Director)– Singapore Institute of Management (Member, Finance

Committee)– Singapore Scouts Association (Member, Scout Council and

Chairman, Audit Committee)– Singapore Totalisator Board (Director, Special Duties)– Surbana International Consultants Holdings Pte. Ltd. (Director)– Woodbridge Hospital Endowment Fund (Treasurer, Board of

Trustees)

background and working experience– Singapore Turf Club (Senior Vice President, Corporate

Services from May 2000 to June 2004)– Singapore Turf Club (Deputy General Manager, Corporate

Services from May 1998 to May 2000)– Easycall International Pte Ltd/Matrix Telecommunications

Ltd (Chief Financial Officer from June 1996 to April 1998)– Amcol Holdings Limited (General Manager, Corporate

Services from October 1993 to May 1996)– Auditor-General’s Office (Assistant Auditor-General from

February 1987 to September 1993)– Auditor-General’s Office (Divisional Director from May 1980

to January 1987)– Auditor-General’s Office (Auditor from November 1975 to

April 1979)

Award– Institute of Certified Public Accountants

of Singapore Silver Medal (1999)

Board ofDirectors

1 Mr Fong Heng Boo was appointed the Chairman of the Audit Committee with effect from 5 February 2014.


21

Christopher Gee Kok Aun, 45independent non-executive directorBachelor of Arts in Law (Honours), University of Nottingham, UKMember, The Institute of Chartered Financial Analysts

Date of first appointment as a director: 24 January 2014

board committee served onAudit Committee (Member)

present principal commitment (other than directorships in listed companies)Institute of Policy Studies, Lee Kuan Yew School of Public Policy,

National University of Singapore (Research Fellow)

background and working experience– J.P. Morgan Securities Singapore Private Limited (Head of

Singapore Equities Research from July 2002 to February 2012 and Head of Asia Real Estate Equities Research from September 2006 to February 2012)

– ING Barings Securities (Head, Singapore and Malaysia Equities Research from June 2000 to June 2002)

– ING Barings Securities Malaysia Sdn. Bhd. (Head, Malaysia Equities Research and Investment Analyst from June 1994 to June 2000)

– Price Waterhouse, London (Audit and corporate recovery from September 1990 to March 1994)


Board ofDirectors

Ng Kok Siong, 42non-independent non-executive directorBachelor of Accountancy (Honours), Nanyang Technological University of Singapore

Date of first appointment as a director: 21 July 2009length of service as a director (as at 31 December 2013): 4 years 5 months

board committees served on– Audit Committee (Member)– Corporate Disclosure Committee (Member)– Executive Committee (Member)

present directorship in other listed companies– CapitaMalls Malaysia REIT Management Sdn. Bhd.

(manager of CapitaMalls Malaysia Trust)

present principal commitment (other than directorships in listed companies)– CapitaMalls Asia Limited (Chief Financial Officer)

background and working experience– CapitaLand Limited (Senior Vice President, Strategic Finance

from October 2008 to September 2009)– CapitaLand Limited (Senior Vice President, CapitaLand

Eurasia from January 2007 to October 2008)– CapitaLand Limited (Vice President, Office of the President

from September 2005 to January 2007)– Shell Oil Products East (Strategy and Portfolio Manager from

August 2003 to September 2005)– Shell Oil Products East (Planning and Appraisal Advisor from

July 2001 to August 2003)– Exxon Mobil Asia Pacific Pte Ltd (Regional Advisor from

May 2000 to July 2001)– Esso Coordination Centre N.V. (Global Analyst from

January 1999 to May 2000)– Esso Singapore Private Limited (Senior Planning Analyst

from July 1998 to January 1999)


23

Tony Tan Tee Hieong, 47Chief executive officer non-independent executive directorBachelor of Accountancy, National University of SingaporeMaster of Business Administration, University of Manchester

Date of first appointment as a director: 1 July 2010length of service as a director (as at 31 December 2013): 3 years 6 months

board committee served on– Executive Committee (Member)

background and working experience– CapitaRetail China Trust Management Limited

(Deputy Chief Executive Officer from April 2010 to June 2010)– CapitaRetail China Trust Management Limited

(Head, Finance from September 2007 to June 2010)– IKEA (Asia Pacific Treasurer from August 1998 to

September 2007)– Wearnes International (Treasury Accountant from May 1995 to

August 1998)– Credito Italiano Bank (Money Market Dealer from April 1994 to

May 1995)– Harlow Ueda Sassoon (Money Market Broker from

November 1992 to April 1994)– Ernst & Young (Auditor from June 1991 to October 1992)


Trust ManagementTeam (CRCTML)

ChieF exeCuTive oFFiCerMr Tony Tan Tee HieongChief executive officer & executive directorRefer to the description under the section on the Board of Directors, page 23.

invesTmenT And AsseT mAnAgemenT TeAmThe Investment and Asset Management team is based in China. They are responsible for identifying and evaluating potential acquisitions and investments, as well as formulating business and enhancement plans for CRCT’s assets. They work closely with the property managers as well as the shopping malls’ centre management to ensure that the plans are diligently implemented.

Mr Tan Tze Wooivice president, investment and Asset managementTze Wooi has over 15 years of financial experience in real estate, corporate banking, credit and auditing. He was an Investment and Asset Manager for CapitaMalls Asia before joining CRCTML. He is a Chartered Financial Analyst and holds a Bachelor of Accountancy (Honours) from Nanyang Technological University of Singapore.

Ms Chen Xinmanager, investment and Asset managementChen Xin has over 10 years of experience in China’s real estate industry, in particular, in investment analysis and asset management. She is a Chartered Financial Analyst and holds a Master of Science in Estate Management from the National University of Singapore and a Bachelor of Science in Urban and Regional Planning from Beijing University, China.

Ms Liang Xin Huamanager, investment and Asset managementXin Hua has over eight years of experience in China’s real estate industry, in particular, in investment analysis and asset management. Xin Hua holds a Master of Science in Estate Management from the National University of Singapore and a Bachelor of Economics in Finance from Nankai University, China.

FinAnCe TeAmThe Finance Team is responsible for all finance-related functions, including the preparation of statutory accounts, budgeting, sourcing and management of funds, management of treasury and tax affairs, compliance, liaison with external audit, and all other finance-related matters.

Ms Joanne Tan Siew Beehead, FinanceJoanne has over 13 years of finance and accounting experience. She holds a professional degree with the Association of Chartered Certified Accountants (ACCA) and is a member of the Institute of Singapore Chartered Accountants.

invesTor relATions TeAmThe Investor Relations Team is responsible for maintaining transparent communications with Unitholders, potential investors and analysts through communication channels such as the annual reports, press releases, presentations, roadshows, and CRCT’s website.

Ms Leng Tong Yanmanager, investor relations Tong Yan has over seven years of experience in audit and she was last an Internal Audit Manager with CapitaMalls Asia before joining CRCTML in May 2013. She holds a Bachelor of Accountancy from Nanyang Technological University of Singapore.


25

Corporate Governance

our roleOur primary role as the manager of CRCT (Manager) is to set the strategic direction of CRCT and make recommendations to HSBC Institutional Trust Services (Singapore) Limited, in its capacity as trustee of CRCT (Trustee), on acquisition, divestment and enhancement of the assets of CRCT in accordance with its stated investment strategy. The research, evaluation and analysis required for this purpose is coordinated and carried out by us as the Manager.

As the Manager, we have general powers of management over the assets of CRCT. Our primary responsibility is to manage the assets and liabilities of CRCT for the benefit of the unitholders of CRCT (Unitholders). We do this with a focus on generating rental income and enhancing asset value over time so as to maximise the returns from the investments, and ultimately the distributions and total returns to Unitholders.

Our other functions and responsibilities as the Manager include:

(a) using our best endeavours to conduct CRCT’s business in a proper and efficient manner and to conduct all transactions with, or on behalf of, CRCT at arm’s length;

(b) preparing annual business plans for review by the directors of the Manager (Directors), including forecasts on revenue, net income and capital expenditure, explanations on major variances to previous years’ numbers, written commentaries on key issues and underlying assumptions

on rental rates, operating expenses and any other relevant assumptions;

(c) ensuring compliance with relevant laws and regulations, including the Listing Manual of Singapore Exchange Securities Trading Limited (SGX-ST) (Listing Manual), the Code on Collective Investment Schemes (CIS Code) issued by the Monetary Authority of Singapore (MAS) (including Appendix 6 of CIS Code (Property Funds Appendix)) and the tax rulings issued by the Inland Revenue Authority of Singapore on the taxation of CRCT and Unitholders;

(d) attending to all regular communications with Unitholders; and

(e) supervising CapitaLand Retail (Shanghai) Management & Consulting Co., Ltd. (Property Manager), the property manager which performs the day-to-day property management functions (including leasing, marketing, promotion, coordination and property management) for CRCT’s malls.

CRCT, constituted as a trust, is externally managed by the Manager and therefore has no personnel of its own. The Manager appoints experienced and well qualified management to run its day-to-day operations. All Directors and employees of the Manager are remunerated by the Manager and not CRCT.

The Manager was appointed in accordance with the terms of the trust deed constituting CRCT and dated 23 October 2006

(as amended, varied or supplemented from time to time) (Trust Deed). The Trust Deed also outlines certain circumstances under which the Manager can be removed, including by notice in writing given by the Trustee upon the occurrence of certain events, or by a resolution passed by a simple majority of Unitholders present and voting at a meeting of Unitholders duly convened and held in accordance with the provisions of the Trust Deed.

our Corporate governance CultureThe Manager observes high standards of corporate conduct which are in line with the Principles of the Code of Corporate Governance 2012 (Code). The Manager believes in developing and maintaining sound and transparent policies and practices to meet the specific business needs of CRCT and to provide a firm foundation for a trusted and respected business enterprise. The Manager remains focused on complying with the substance and spirit of the Principles of the Code while achieving operational excellence and delivering CRCT’s long-term strategic objectives.

This report on the corporate governance practices for financial year 2013 describes the Manager’s application of good governance principles in building a company committed to integrity, transparency, excellence and its people. This application is underpinned by sound and robust systems of internal controls and accountability to promote and drive long-term sustainable growth and value for Unitholders.

The following sections outline the Manager’s policies and practices on corporate governance. Where



there is any material deviation from any Principle of the Code, an explanation has been provided within this report.

(A) boArd mATTersThe board’s Conduct of Affairsprinciple 1:every company should be headed by an effective board to lead and control the company. The board is collectively responsible for the long-term success of the company. The board works with management to achieve this objective and management remains accountable to the board.

The Manager is led by a Board of Directors (Board), with independent non-executive Directors constituting half of the Board. Each Director brings to the Board skills, experience, insights and sound judgement, which together with strategic networking relationships, serve to further the interests of CRCT. At all times, the Directors are collectively and individually obliged to act honestly and with diligence, and consider the best interests of Unitholders.

The Board oversees the affairs of the Manager, in furtherance of the Manager’s primary responsibility to manage the assets and liabilities of CRCT for the benefit of Unitholders. The Chief Executive Officer, who is assisted by management team of the Manager (Management), is responsible for the day-to-day management and overall operation of CRCT’s business.

The Board provides leadership to Management, sets strategic directions and oversees the competent management of CRCT. The Board establishes goals for Management and monitors the achievement of these goals. It ensures that proper and effective

controls are in place to assess and manage business risks and compliance with requirements under the Listing Manual, the Property Funds Appendix, as well as any other applicable guidelines prescribed by the SGX-ST, the MAS or other relevant authorities, and applicable laws. It also sets the disclosure and transparency standards for CRCT and ensures that obligations to Unitholders and other stakeholders are understood and met.

Various Board Committees, namely the Audit Committee, Corporate Disclosure Committee and Executive Committee have been constituted with clear written Terms of Reference to assist the Board in the discharge of its functions.

Each of these Board Committees operates under delegated authority from the Board. The Board may form other Board Committees as dictated by business imperatives. Membership of the various Board Committees is carefully managed to ensure an equitable distribution of responsibilities among Board members, to maximise the effectiveness of the Board and to foster active participation and contribution from Board members. Diversity of experience and appropriate skills are considered.

A table of the Board members’ participation in the various Board Committees is set out on page 38 of the Annual Report. This reflects each Board member’s additional responsibilities and special focus in the respective Board Committees.

The Board has adopted a set of internal controls which establishes approval limits for, amongst others, capital expenditure, investments and divestments and bank borrowings. Apart from matters

that specifically require the Board’s approval – such as the issue of new units, income distributions and other returns to Unitholders – the Board, while approving certain transactions exceeding certain threshold limits, delegates authority for transactions below those limits to Board Committees and Management. Approval sub-limits are also provided at Management level to optimise operational efficiency.

The Board meets at least once every quarter, and as required by business imperatives. Where a physical Board meeting is not possible, the Articles of Association of the Manager permit the Directors to meet via teleconferencing or video conferencing. The Board and Board Committees may also make decisions by way of resolutions in writing.

A total of four Board meetings were held in the financial year 2013. A table showing the attendance record of Directors at Board and Audit Committee meetings during the year under review is set out on page 38 of the Annual Report.

Board meetings for each year are scheduled in advance in the preceding year to facilitate Directors’ individual administrative arrangements in respect of competing commitments.

The Manager provides suitable training for Directors. Upon appointment, each Director is provided a formal letter of appointment setting out various information including duties and obligations as a Director. Newly appointed Directors are briefed on the business activities of CRCT, its strategic directions and policies, the regulatory environment in which CRCT operates and the Manager’s corporate governance practices.


27

Following their appointment, Directors are provided with opportunities for continuing education in areas such as Directors’ duties and responsibilities, changes to regulations and accounting standards and industry-related matters so as to be updated on matters that affect or may enhance their performance as Board or Board Committee members.

board Composition and guidanceprinciple 2:There should be a strong and independent element on the board, which is able to exercise objective judgement on corporate affairs independently, in particular, from management and 10% shareholders. no individual or small group of individuals should be allowed to dominate the board’s decision making.

The Board comprises six Directors, of whom three are independent non-executive Directors who have no relationship with the Manager, its related corporations, its shareholders who hold 10% or more of the voting shares in the Manager, Unitholders who hold 10% or more of the units in issue of CRCT or its officers that could interfere, or be reasonably perceived to interfere, with the exercise of the Directors’ independent business judgement in the best interests of CRCT.

The size and composition of the Board is reviewed regularly to ensure that the Board is of appropriate size and has an optimal mix of expertise and experience, and comprises persons who, as a group, provide the necessary core competencies, taking into consideration the nature and scope of CRCT’s operations. The profiles of the Directors are set out on pages 17 to 23 of the Annual Report.

The Directors are business leaders and professionals with financial, banking, real estate, legal, investment and accounting backgrounds. The varied background of the Directors enables Management to benefit from their external, diverse and objective perspectives on issues brought before the Board. It also enables the Board to interact and work with Management through a robust exchange of ideas and views to help shape the strategic process. This, together with the separation of the roles of the Chairman and the Chief Executive Officer, provides a healthy professional relationship between the Board and Management with clarity of roles and facilitates robust deliberation on the business activities of the CRCT.

The independence of each Director is reviewed by the Board upon appointment, and thereafter annually and as and when circumstances require. The Board has determined that Mr Liew Cheng San Victor, Mr Fong Heng Boo and Mr Christopher Gee Kok Aun to be Independent Directors under the Code.

Chairman and Chief executive officerprinciple 3:There should be a clear division of responsibilities between the leadership of the board and the executives responsible for managing the company’s business. no one individual should represent a considerable concentration of power.

To maintain an appropriate balance of power, increased accountability and greater capacity of the Board for independent decision making, the roles and responsibilities of Chairman and Chief Executive

Officer are held by separate individuals.

The independent non-executive Chairman is responsible for leading the Board and ensuring that the Board is effective on all aspects of its role, while the Chief Executive Officer is responsible for the overall operation of the CRCT’s business. The Chairman and Chief Executive Officer are not immediate family members.

The Chairman ensures that the members of the Board and Management work together with integrity, competency and moral authority, and that the Board constructively engages Management on strategy, business operations, enterprise risk and other plans. The Chairman also approves the agendas for the Board meetings and ensures sufficient allocation of time for thorough discussion of each agenda item.

The Chief Executive Officer is a Board member and has full executive responsibilities over the business directions and operational decisions of CRCT. He ensures the quality and timeliness of the flow of information between Management and the Board. He is also responsible for ensuring that the Manager complies with the Principles and Guidelines of the Code.

board membershipprinciple 4:There should be a formal and transparent process for the appointment and re-appointment of directors to the board.

As the Manager is not a listed entity, it does not have a nominating committee. Thus, the Board performs the functions that such a committee would otherwise



perform, namely, it administers nominations to the Board, reviews the structure, size and composition of the Board, and reviews the independence of Board members. Directors of the Manager are not subject to periodic retirement by rotation.

Under the Code, the composition of the Board, including the selection of candidates for new appointments to the Board as part of the Board’s renewal process, is determined using the following principles:

(a) the Board should comprise Directors with a broad range of commercial experience, including expertise in funds management, the property industry and in the banking and legal fields; and

(b) at least one-third of the Board should comprise Independent Directors. Where, among other things, the Chairman of the Board is not an Independent Director, at least half of the Board should comprise Independent Directors.

The selection of candidates is evaluated taking into account various factors including the current and mid-term needs and goals of CRCT, as well as the relevant expertise of the candidates and their potential contributions. Candidates may be put forward or sought through contacts and recommendations.

Guideline 4.4 of the Code recommends that the Board determine the maximum number of listed companies board representations which any director may hold and disclose this in the annual report. The Board is of the view that, the limit on the number

of listed company directorships that an individual may hold should be considered on a case-by-case basis, as a person’s available time and attention may be affected by many different factors such as whether they are in full-time employment and their other responsibilities. A Director with multiple directorships is expected to ensure that sufficient attention is given to the affairs of the Manager in managing the assets and liabilities of CRCT for benefit of Unitholders. The Board believes that each individual Director is best placed to determine and ensure that he is able to devote sufficient time and attention to discharge his duties and responsibilities as a Director of the Manager, bearing in mind his other commitments. In considering the nomination of Directors for appointment, the Board will take into account, amongst others, the competing time commitments faced by Directors with multiple Board memberships. All Directors had confirmed that notwithstanding the number of their individual listed company board representations and other principal commitments, which the Directors held, they were able to devote sufficient time and attention to the affairs of the Manager in managing the assets and liabilities of CRCT for benefit of Unitholders. The Board is of the view that the current commitments of each of its Directors are reasonable and each of the Directors is able to and has been adequately carrying out his duties.

board performanceprinciple 5:There should be a formal annual assessment of the effectiveness of the board as a whole and its board committees and the contribution by each director to the effectiveness of the board.

The Manager believes that Board performance is ultimately reflected in the long-term performance of CRCT.

Reviews of Board performance are carried out on an informal basis. The Manager believes that collective Board performance and that of individual Board members are better reflected in, and evidenced by, its and their proper guidance, diligent oversight and able leadership, and the support that it lends to Management in steering CRCT in the appropriate direction, and the long-term performance of CRCT whether under favourable or challenging market conditions.

Contributions by an individual Board member can also take other forms, including providing objective perspectives on issues, facilitating business opportunities and strategic relationships, and accessibility by Management outside of a formal environment of Board and/or Board Committee meetings.

Renewals or replacement of Board members do not necessarily reflect their contributions to date, but may be driven by the need to position and shape the Board in line with the needs of CRCT and its business.

Access to informationprinciple 6:in order to fulfil their responsibilities, directors should be provided with complete, adequate and timely information prior to board meetings and on an on-going basis so as to enable them to make informed decisions to discharge their duties and responsibilities.

The Manager believes that the Board should be provided with timely, adequate and complete


29

information prior to Board meetings, and as and when the need arises. As a general rule, Board papers are sent to Board members at least five working days prior to the Board meeting to allow the members to prepare for the Board meetings; this enables the discussions to focus on questions that the members may have. However, sensitive matters may be tabled at the meeting itself or discussed without any papers being distributed. At all times, the Directors have access to the Manager’s records, such as Board papers and related materials, and minutes of Board meetings and Board Committee meetings.

Management provides timely, adequate and complete information to the Board on Board affairs and issues requiring the Board’s decision. It also provides ongoing reports relating to the operational and financial performance of the Manager, such as monthly management reports. Timely communication with members of the Board is effected through electronic means which include electronic mail, teleconferencing and video conferencing. Informal meetings are also held for Management to brief Directors on prospective deals and potential developments in the early stages before formal Board approval is sought.

The Board has separate and independent access to Management including the company secretary of the Manager (Company Secretary) at all times. The Company Secretary attends to corporate secretarial administration matters and is the corporate governance advisor on corporate matters to the Board and Management. The Company Secretary attends Board meetings. The Board, whether as individual

Director or as a group, is also entitled to have access to independent professional advice where required, at the Manager’s expense.

The Audit Committee also meets the internal and external auditors separately at least twice a year without the presence of the Chief Executive Officer and Management, and has unfettered access to any information that it may require.

(b) remunerATion mATTersprocedures for developing remuneration policiesprinciple 7:There should be a formal and transparent procedure for developing policy on executive remuneration and for fixing the remuneration packages of individual directors. no director should be involved in deciding his own remuneration.

level and mix of remunerationprinciple 8:The level and structure of remuneration should be aligned with the long-term interest and risk policies of the company, and should be appropriate to attract, retain and motivate (a) the directors to provide good stewardship of the company, and (b) key management personnel to successfully manage the company. however, companies should avoid paying more than is necessary for this purpose.

disclosure on remunerationprinciple 9:every company should provide clear disclosure of its remuneration policies, level and mix of remuneration, and the procedure for setting remuneration, in the company’s Annual report. it should provide disclosure in relation to its

remuneration policies to enable investors to understand the link between remuneration paid to directors and key management personnel, and performance.

As the remuneration of Directors and staff of the Manager is paid by the Manager, and not by CRCT, the Manager does not consider it necessary to include information (other than as voluntarily provided in the table on page 30 of the Annual Report) on the remuneration of the Directors and its key executives in this report. The Manager is not a listed entity and so it does not have a remuneration committee.

The Board has carefully considered the remuneration policies and practices of the Manager’s holding company, CapitaMalls Asia Limited (CMA), and believes that such policies and practices will provide the Manager with a transparent and suitable remuneration policy. CMA has a remuneration committee that determines and recommends to the CMA board of directors the framework of remuneration, terms of engagement, compensation and benefits for senior executives of CMA and its subsidiaries, which include the Chief Executive Officer and Management.

The Directors’ fees for financial year 2013 are shown in the table on page 30 of the Annual Report. The Chief Executive Officer does not receive any fees in his capacity as a Director. Directors’ fees generally comprise a basic retainer fee as a Director, an additional fee for serving on any of the Board Committees and an attendance fee for participation in meetings of the Board and any of the Board Committees, project meetings and verification meetings.



direCTors’ Fees

Board MembersFinancial Year

2013 1Financial Year

2012 1, 2

Liew Cheng San Victor S$129,000 4 S$145,000Lim Ming Yan S$117,000 5 N.A.Chew Gek Khim S$91,000 6 S$89,000Fong Heng Boo S$76,000 4 N.A.Christopher Gee Kok Aun 7 N.A. N.A.Ng Kok Siong S$94,000 5 S$83,000 3

Tony Tan Tee Hieong – –1 Inclusive of attendance fees of (a) S$2,000 per meeting attendance in person, (b) S$1,700 per meeting attendance via teleconferencing or video

conferencing, and (c) S$1,000 per meeting attendance at project and verification meetings subject to a maximum of S$10,000 per Director per annum. Directors’ fees are subject to the approval of the Manager’s sole shareholder.

2 Each Non-Executive Director shall receive up to 20% of his or her Directors’ fees in respect of financial year 2012 in the form of Units (subject to rounding adjustments). The remainder of the Directors’ fees shall be paid in cash. No new Units will be issued for this purpose as these Units will be paid by the Manager from the Units it holds.

3 In respect of Directors who are employees of CMA, the cash component of their Directors’ fees will be paid to CMA. They will be entitled to retain the Units component of their Directors’ fees.

4 Each Non-Executive Director (save for Directors who are employees of CapitaLand Limited or CMA) shall receive up to 20% of his Directors’ fees in respect of financial year 2013 in the form of Units (subject to rounding adjustments). The remainder of the Directors’ fees shall be paid in cash. No new Units will be issued for this purpose as these Units will be paid by the Manager from the Units it holds.

5 In respect of Directors who are employees of CapitaLand Limited or CMA, their Directors’ fees will be paid in cash to CapitaLand Limited and CMA respectively. 6 Ms Chew Gek Khim resigned as an independent non-executive Director and ceased to be the Chairperson of the Audit Committee with effect from

5 February 2014. All Directors’ fees payable to Ms Chew Gek Khim will be paid in cash.7 Mr Christopher Gee Kok Aun was appointed as an independent non-executive Director and a member of the Audit Committee with effect from 24 January 2014.

Non-Executive Directors (save for Directors who are employees of CapitaLand Limited or CMA) receive Directors’ fees which are payable by way of cash and units in CRCT (Units). The Manager believes that the payment of a portion of the Directors’ fees in Units will serve to align the interests of such Directors with that of Unitholders and CRCT’s long-term growth and value.

(C) ACCounTAbiliTy And AudiT

Accountabilityprinciple 10:The board should present a balanced and understandable assessment of the company’s performance, position and prospects.

The Manager provides Unitholders with quarterly and annual financial statements as required by and within the timeframe set out in the Listing Manual.

In presenting the annual and quarterly financial statements to Unitholders, the Board aims to provide Unitholders with a balanced, clear and understandable assessment of CRCT’s performance, position and prospects. In order to achieve this, Management provides the Board with management accounts on a monthly basis and such explanation and information as any Director may require, to enable the Directors to keep abreast, and make a balanced and informed assessment, of the CRCT’s financial performance, position and prospects.

The Manager believes in conducting itself in ways that seek to deliver maximum sustainable value to Unitholders. Best practices are promoted as a means to build an excellent business for Unitholders and the Manager is accountable to Unitholders for CRCT’s

performance. Prompt fulfilment of statutory reporting requirements is but one way to maintain Unitholders’ confidence and trust in the capability and integrity of the Manager.

risk management and internal Controlsprinciple 11:The board is responsible for the governance of risk. The board should ensure that management maintains a sound system of risk management and internal controls to safeguard shareholders’ interests and the company’s assets, and should determine the nature and extent of the significant risks which the board is willing to take in achieving its strategic objectives.

The Manager has in place an adequate and effective system of internal controls addressing material financial, operational, compliance


31

and information technology risks to safeguard Unitholders’ interests and CRCT’s assets.

The Board has overall responsibility for the governance of risk and exercises oversight of the risk management strategy and framework.

The Audit Committee provides oversight of the financial reporting risk and the adequacy and effectiveness of the Manager’s internal controls.

The Manager adopts an Enterprise Risk Management Framework (ERM Framework) which sets out the required environmental and organisational components for managing risk in an integrated, systematic and consistent manner. The ERM Framework and related policies are reviewed at least annually.

As part of the ERM Framework, Management, amongst other things, undertakes and performs a risk and control self-assessment (RCSA) process. As a result of the RCSA process, the Manager produces and maintains a risk register which identifies the material risks it faces and the corresponding internal controls in place to manage or mitigate those risks. The material risks are reviewed annually by the Audit Committee and the Board.

Internal and external auditors conduct audits that involve testing the effectiveness of the material internal control systems in CRCT and its subsidiaries (CRCT Group) addressing financial, operational, compliance and information technology risks, including testing, where practical, material internal controls in areas managed by external service providers. Any material non-compliance

or lapses in internal controls together with corrective measures recommended by internal and external auditors are reported to and reviewed by the Audit Committee. The adequacy and effectiveness of the measures taken by the Manager in response to the recommendations made by the internal and external auditors are also reviewed by the Audit Committee.

The Board has received assurance from the Chief Executive Officer and Head of Finance of the Manager that:

(a) the financial records of the CRCT Group have been properly maintained and the financial statements for the year ended 31 December 2013 give a true and fair view of the CRCT Group’s operations and finances; and

(b) the system of risk management and internal controls in place within the CRCT Group is adequate and effective in addressing the material risks faced by the CRCT Group in its current business environment including material financial, operational, compliance and information technology risks. The Chief Executive Officer and Head of Finance of the Manager have obtained similar assurance from the functions heads in CRCT Group.

In addition, in the year under review, the Board has provided a negative assurance confirmation to Unitholders, as required by the Listing Manual.

Based on the ERM Framework established and the reviews conducted by Management and both the internal and external

auditors as well as the assurance from the Chief Executive Officer and Head of Finance of the Manager, the Board concurs with the recommendation of the Audit Committee and is of the opinion, that the CRCT Group’s system of risk management and internal controls addressing material financial, operational, compliance and information technology risks is adequate and effective to meet the needs of the CRCT Group in its current business environment as at 31 December 2013.

The Board notes that the system of risk management and internal controls established by the Manager provides reasonable, but not absolute, assurance that the CRCT Group will not be significantly affected by any event that can be reasonably foreseen as it strives to achieve its business objectives. However, the Board also notes that no system of risk management and internal controls can provide absolute assurance in this regard, or absolute assurance against poor judgement in decision making, human error, losses, fraud or other irregularities.

Audit Committeeprinciple 12:The board should establish an Audit Committee with written terms of reference which clearly set out its authority and duties.

The Audit Committee comprises three non-executive Directors, the majority of whom (including the Chairman of the Audit Committee) are independent. The members bring with them invaluable recent and relevant managerial and professional expertise in accounting and related financial management domains.



The Audit Committee functions independently of the officers and other Directors of the Manager who are not Audit Committee members. Management is required to provide the fullest co-operation in providing information and resources, and in implementing or carrying out all requests made by the Audit Committee. The Audit Committee has direct access to the internal and external auditors and full discretion to invite any Director or executive officer to attend its meetings. Similarly, both the internal and external auditors are given unrestricted access to the Audit Committee.

The Audit Committee is guided by Terms of Reference which defines its scope of authority. Specifically, the Audit Committee:

(a) monitors and evaluates the effectiveness of the Manager’s system of risk management and internal controls (including financial, operational and compliance controls and risk management policies and systems) through reviewing internal and external audit reports to ensure that where deficiencies in internal controls have been identified, appropriate and prompt remedial action is taken by Management;

(b) reviews the quality and reliability of information prepared for inclusion in the financial reports and approves the financial statements and the audit report before recommending to the Board for approval;

(c) reviews the adequacy and effectiveness of the internal audit function;

(d) monitors the procedures established to regulate all transactions involving an Interested Person (as defined in Chapter 9 of the Listing Manual) and/or Interested Party (as defined in the Property Funds Appendix) (each, an Interested Person) and CRCT and/or its subsidiaries (Interested Person Transactions) including ensuring compliance with the provisions of the Listing Manual and the Property Funds Appendix relating to Interested Person Transactions;

(e) reviews the appointment and re-appointment of external auditors (including remuneration and terms of engagement) before recommending them to the Board for recommendation to Unitholders at each annual general meeting and reviewing the adequacy of existing audits in respect of cost, scope and performance;

(f) reviews the scope and results of the external audit and also assesses the cost effectiveness, the independence and objectivity of the external auditors. Where the external auditors also supply substantial volume of non-audit services to CRCT, the Audit Committee shall keep the nature and extent of such services under review, seeking to balance the maintenance of objectivity and value for money; and

(g) monitors the procedures in place to ensure compliance with applicable legislation, the Listing Manual and the Property Funds Appendix.

The Audit Committee has reviewed all non-audit services provided by the external auditors during the financial year and is satisfied that the nature and extent of such services will not prejudice the independence and objectivity of the external auditors. The aggregate amount of audit fees paid and payable to the external auditors for financial year 2013 was S$428,698, of which audit fees amounted to S$421,198 and non-audit fees amounted to S$7,500.

Management closely monitors changes to accounting standards and other similar issues which may potentially have an impact on financial statements, and provides the Audit Committee with relevant briefings and updates during quarterly Audit Committee meetings, at specially convened sessions conducted by professionals or via circulation of Audit Committees papers.

A total of four Audit Committee meetings were held in 2013. The Audit Committee also held two meetings with the internal auditors and external auditors, without Management’s presence, to discuss the reasonableness of the financial reporting process, the system of internal controls, and the significant comments and recommendations by the auditors.

The Manager confirms, on behalf of CRCT, that CRCT complies with Rule 712 and Rule 715 of the Listing Manual.

internal Auditprinciple 13:The company should establish an effective internal audit function that is adequately resourced and independent of the activities it audits.


33

The Manager has in place an internal audit function supported by CMA’s Internal Audit Department (CMA IA) which reports directly to the Audit Committee and administratively to the Chief Executive Officer. CMA IA plans its internal audit schedules in consultation with, but independently of, Management and its plan is submitted to the Audit Committee for approval prior to the beginning of each year. The Audit Committee also meets with CMA IA at least twice a year without the presence of Management. CMA IA has unfettered access to all the Manager’s documents, records, properties and personnel, including access to the Audit Committee.

To ensure that the internal audits are performed effectively, CMA IA recruits and employs suitably qualified professional staff with the requisite skill sets and experience.

CMA IA identifies and provides training and development opportunities for its staff to ensure their technical knowledge and skill sets remain current and relevant.

(d) uniTholder righTs And responsibiliTies

shareholder rightsprinciple 14:Companies should treat all shareholders fairly and equitably, and should recognise, protect and facilitate the exercise of shareholders’ rights, and continually review and update such governance arrangements.

The Manager is committed to treating all Unitholders fairly and equitably and keeping all Unitholders and other stakeholders and analysts informed of the performance and changes in CRCT or its business which would be likely to materially affect the price or value of Units, on

a timely and consistent basis, so as to assist Unitholders and investors in their investment decisions. The Manager provides accurate and timely disclosure of material information on the SGXNET.

All Unitholders are entitled to attend general meetings and are accorded the opportunity to participate effectively and vote at general meetings. All Unitholders are also informed of the rules, including voting procedures, governing such meetings.

Communication with shareholdersprinciple 15:Companies should actively engage their shareholders and put in place an investor relations policy to promote regular, effective and fair communication with shareholders.

The Manager has in place the Investor Relations and Corporate Communications team which facilitates effective communication with Unitholders, analysts, fund managers and the media.

The Manager actively engages with Unitholders and has put in place an Investor Relations Policy to promote regular, effective and fair communications with Unitholders. The Policy is uploaded on CRCT’s website at www.capitaretailchina.com.

The Board has established the Corporate Disclosure Committee which reviews the promptness and comprehensiveness of corporate disclosures and announcements made to the SGX-ST. It ensures the adoption of good corporate governance and best practices in terms of transparency to Unitholders and investing community.

The Manager makes disclosures in a timely manner as required under the Listing Manual, or as soon as possible where immediate disclosure is not practicable. Regular briefings and meetings for analysts and the media are held, generally coinciding with the release of CRCT’s second quarter and full-year results. During these briefings, Management reviews CRCT’s most recent performance and discusses CRCT’s outlook. In the interest of transparency and broad dissemination, materials used in the briefings are disseminated via SGXNET and recordings of the briefings are also archived on CRCT’s website.

In 2013, the Manager met with institutional investors from Malaysia, Hong Kong, China, Japan, the United States and Canada. These meetings and roadshows with investors enabled the Manager to update potential and current Unitholders on CRCT’s significant developments and its medium to long-term strategies. CRCT also participated in various local and overseas conferences as part of its efforts to build interest in the Singapore REIT market.

In addition, the Manager pursues opportunities to keep its retail Unitholders informed through the business media, website postings and other publicity channels. Materials used in the briefings to institutional Unitholders are also disseminated via SGXNET for easy access by retail Unitholders.

Unitholders and potential investors have access to CRCT’s website which is available in English including a dedicated Investor Relations link providing CRCT’s latest announcements and stock details. The public is able to post questions to the Manager on



CRCT’s website through the ‘Ask Us’ link. Unitholders may also raise any enquiry to the Manager by post to the Investor Relations department of the Manager at 39 Robinson Road, #18-01 Robinson Point, Singapore 068911. Conduct of shareholder meetingsprinciple 16:Companies should encourage greater shareholder participation at general meetings of shareholders, and allow shareholders the opportunity to communicate their views on various matters affecting the company.

The Manager supports the principle of encouraging Unitholders’ participation and voting at general meetings. Unitholders receive a CD containing CRCT Annual Report (printed copies are available upon request) and notice of the annual general meeting. As and when an extraordinary general meeting is to be held, Unitholders will receive a copy of circular which contains details of the matters to be proposed for Unitholders’ consideration and approval. Notices of the general meetings are also issued via SGXNET.

At general meetings, Unitholders are encouraged to communicate their views on and discuss with the Board and Manager matters affecting CRCT. Representatives of the Trustee, Directors (including the respective Chairpersons of the Board and the Audit Committee), the Manager’s senior management and the external auditors of CRCT, would usually be present at general meetings.

To safeguard Unitholder interests and rights, a separate resolution is proposed for each substantially separate issue at general meetings.

To ensure transparency in the voting process and better reflect Unitholders’ interest, the Manager conducts poll voting for Unitholders/proxies present at the meeting for all the resolutions proposed at the general meetings. The total number of votes cast for or against the resolutions and the respective percentages are announced after the general meetings via SGXNET. Minutes of general meetings are taken and are available to Unitholders for their inspection upon request. Unitholders also have the opportunity to communicate their views and discuss with the Board and Manager matters affecting CRCT after the general meetings.

(e) AddiTionAl inFormATionAdditional CommitteesApart from Audit Committee and Corporate Disclosure Committee, the Board has also established Executive Committee.

The Executive Committee oversees the day-to-day activities and affairs of the Manager and that of CRCT on behalf of the Board. The principal responsibilities of the Executive Committee under its Terms of Reference include the following:

(a) approving or making recommendations to the Board on new investments and acquisitions;

(b) approving specific budgets for capital expenditure on development projects, acquisitions and enhancements/ upgrading of properties;

(c) reviewing management reports and operating budgets; and

(d) awarding contracts for development projects.

The members of the Executive Committee also meet informally during the course of the year.

dealings with interested personsreview procedures for interested person Transactions The Manager has established internal control procedures to ensure that all Interested Person Transactions are undertaken on an arm’s length basis and on normal commercial terms, which are generally no more favourable than those extended to unrelated third parties. In respect of such transactions, the Manager would have to demonstrate to the Audit Committee that such transactions are undertaken on normal commercial terms and are not prejudicial to the interests of CRCT and Unitholders which may include obtaining (where practicable) third party quotations or obtaining valuations from independent valuers (in accordance with applicable provisions of the Listing Manual and the Property Funds Appendix). The internal control procedures also ensure compliance with Chapter 9 of the Listing Manual and the Property Funds Appendix.

In particular, the following procedures are in place:

• transactions (either individually or as part of a series or if aggregated with other transactions involving the same interested person during the same financial year) equal to or exceeding S$100,000 in value, but below 3.0% of CRCT’s net tangible assets, will be subject to review and approval by the Audit Committee;

• transactions (either individually or as part of a series or if aggregated with other


35

transactions involving the same interested person during the same financial year) equal to or exceeding 3.0%, but below 5.0% of CRCT’s net tangible assets, will be subject to the review and approval by the Audit Committee, and SGX announcement requirements under the Listing Manual and the Property Funds Appendix;

• transactions (either individually or as part of a series or if aggregated with other transactions involving the same interested person during the same financial year) equal to or exceeding 5.0% of CRCT’s net tangible assets will be subject to review and approval by the Audit Committee which may, as it deems fit, request for advice on the transaction from independent sources or advisors, including the obtaining of valuations from professional valuers, as well as SGX announcement requirements under the Listing Manual and the Property Funds Appendix. Further, under the Listing Manual and the Property Funds Appendix, such transactions would have to be approved by Unitholders at a meeting of Unitholders; and

• the Audit Committee’s approval shall only be given if the transactions are on normal commercial terms and consistent with similar types of transactions undertaken by the Trustee with third parties which are unrelated to the Manager.

Further, the Trustee has the ultimate discretion under the Trust Deed to decide whether or not to enter into an Interested Person Transaction. If the Trustee is to enter into an

Interested Person Transaction, the Trustee will review such transaction to ensure that it complies with applicable requirements under the Listing Manual, the Property Funds Appendix (in each case, as may be amended from time to time) as well as any other applicable guidelines which may from time to time be prescribed by the SGX-ST, the MAS or other relevant authorities.

role of the Audit Committee for interested person TransactionsThe Manager’s internal control procedures are intended to ensure that Interested Person Transactions are conducted at arm’s length and on normal commercial terms, and are not prejudicial to the interests of CRCT and Unitholders. The Manager maintains a register to record all Interested Person Transactions which are entered into by CRCT (and the basis on which they are entered into, including the quotations obtained to support such basis). All Interested Person Transactions are subject to regular periodic reviews by the Audit Committee, which in turn obtains advice from CMA IA, to ascertain that the guidelines and procedures established to monitor Interested Person Transactions, including the relevant provisions of the Listing Manual and the Property Funds Appendix, as well as any other guidelines which may from time to time be prescribed by the SGX-ST, the MAS or other relevant authorities, have been complied with. The review includes an examination of the nature of the transaction and its supporting documents or such other information deemed necessary by the Audit Committee. If a member of the Audit Committee has an interest in a transaction, he is to abstain from participating in the review and approval process in relation to that transaction. In addition, the Trustee

also reviews such audit reports to ascertain that the Listing Manual and the Property Funds Appendix have been complied with.

Details of all Interested Person Transactions (equal to or exceeding S$100,000 each in value) entered into by CRCT during the financial year are disclosed on page 145 of the Annual Report.

dealing with Conflicts of interestThe following principles and procedures have been established to deal with potential conflicts of interest which the Manager (including its Directors, executive officers and employees) may encounter in managing CRCT:

(a) the Manager is a dedicated manager to CRCT and will not manage any other REIT or be involved in any other real property business;

(b) all executive officers of the Manager are employed by the Manager;

(c) all resolutions at meetings of the Board in relation to matters concerning CRCT must be decided by a majority vote of the Directors, including at least one independent non-executive Director;

(d) in respect of matters in which CapitaLand Limited (CapitaLand) and/or its subsidiaries (including CMA) have an interest, whether direct or indirect, any nominees appointed by CapitaLand and/or its subsidiaries (including CMA) to the Board will abstain from voting;

(e) if the Manager is required to decide whether or not to take any action against any person



in relation to any breach of any agreement entered into by the Trustee for and on behalf of CRCT with an affiliate of the Manager, the Manager shall be obliged to consult with a reputable law firm (acceptable to the Trustee) which shall provide legal advice on the matter. If the said law firm is of the opinion that the Trustee, on behalf of CRCT, has a prima facie case against the party allegedly in breach under such agreement, the Manager is obliged to pursue the appropriate remedies under such agreement; and

(f) at least one-third of the Board should comprise independent non-executive Directors.

Additionally, the Trustee has been granted rights of first refusal by CapitaMalls China Income Fund, CapitaMalls China Income Fund II, CapitaMalls China Income Fund III, CapitaMalls China Development Fund III and CMA over any proposed sale or certain proposed acquisitions (as the case may be) of shares or equity interests in properties by CapitaMalls China Income Fund, CapitaMalls China Income Fund II, CapitaMalls China Income Fund III, CapitaMalls China Development Fund III and CMA in China.

Under the Trust Deed, in respect of voting rights where the Manager would face a conflict between its own interests and that of Unitholders, the Manager shall cause such voting rights to be exercised according to the discretion of the Trustee.

dealings in securitiesThe Manager has devised and adopted a securities dealing policy for the Manager’s officers and employees which applies the best

practices recommendations in the Listing Manual. To this end, the Manager has issued guidelines to its Directors and employees as well as certain relevant executives of CMA, which sets out prohibitions against dealings in CRCT’s securities (i) while in possession of material unpublished price sensitive information, (ii) during two weeks before the release of CRCT’s results for the first three quarters, and (iii) during one month before the release of CRCT’s full-year results. The Manager will also not deal in CRCT’s securities during the same period. Under these guidelines, all Directors and employees as well as certain relevant executives of CMA have been directed to refrain from dealing in CRCT’s securities on short-term considerations. They are also made aware of the applicability of the insider trading laws at all times.

(F) Code oF business ConduCT

The Manager adheres to an ethics and code of business conduct policy which deals with issues such as confidentiality, conduct and work discipline, corporate gifts and concessionary offers. Clear policies and guidelines on how to handle work place harassment and grievances are also in place.

All employees of the Manager have each been given a printed employee handbook which sets out these policies clearly.

The Manager believes that the policies it has implemented help to detect and prevent occupational fraud in mainly three ways.

First, the Manager offers fair compensation packages, based on practices of pay-for-performance

and promotion based on merit. The Manager also provides various healthcare subsidies and financial assistance schemes to alleviate the common financial pressures its employees face.

Second, clearly documented policies and work procedures incorporate internal controls which ensure that adequate checks and balances are in place. Periodic audits are also conducted to evaluate the efficacy of these internal controls.

Finally, the Manager seeks to build and maintain the right organisational culture through its core values, educating its employees on good business conduct and ethical values. The Manager’s zero tolerance stance against all types of fraud is also regularly communicated at staff communication sessions.

Anti-Corruption and bribery policyThe Manager adopts a strong stance against corruption and bribery. In addition to clear guidelines and procedures for the giving and receipt of corporate gifts and concessionary offers, all employees of the Manager are required to make a declaration on an annual basis where they pledge to uphold the Manager’s core values and not to engage in any corrupt or unethical practices. The Manager believes that such an initiative serves as a reminder to all employees to maintain the highest standards of integrity in their work and business dealings. The Manager’s stance against corruption and bribery is frequently reiterated by Management during its regular staff communication sessions as well.

The Manager’s zero tolerance policy towards corruption and


37

bribery extends to its dealings with third party service providers and vendors. Pursuant to such policy, the Manager usually requires that all agreements with third party service providers and vendors incorporate robust anti-corruption and anti-bribery provisions.

whistle-blowing policyWhistle-blowing policy and procedures are put in place to provide employees of the Manager and parties with dealings with CRCT with well defined, accessible and trusted channels to report suspected fraud, corruption, dishonest practices or other impropriety in the workplace, and for the independent investigation of any reported incidents and appropriate follow up action. The objective of the whistle-blowing policy is to encourage the reporting of such matters – that employees or external parties making any reports in good faith will be able to do so with the confidence that they will be treated fairly, and to the extent possible, be protected from reprisal. On an ongoing basis, the whistle-blowing policy is covered during periodic communications to employees to promote fraud awareness.

Anti-money laundering and Countering the Financing of Terrorism measuresAs a holder of a Capital Markets Services licence issued by the MAS, the Manager abides by the MAS’ guidelines on the prevention of money laundering and countering the financing of terrorism. Under these guidelines, the main obligations of the Manager are:

• customer due diligence;• suspicious transaction reporting;• record keeping;• employee screening; and• staff training.

The Manager has developed and implemented a policy on the prevention of money laundering and terrorist financing and is alert at all times to suspicious transactions. Where there is a suspicion of money laundering or terrorist financing, the Manager performs due diligence checks on its counterparties in order to ensure that it does not enter into business transactions with terrorist suspects or other high risk persons or entities. Suspicious transactions are also reported to the Suspicious Transaction Reporting office of the Commercial Affairs Department.

Under this policy, the Manager must retain all relevant records or documents relating to business relations with its customers or transactions entered into for a period of at least five years following the termination of such business relations or the completion of such transactions.

All prospective employees of the Manager are also screened against various lists of terrorist suspects issued by the MAS. Periodic training is provided by the Manager to its licensed representatives to ensure they are updated and aware of applicable anti-money laundering and terrorist financing regulations, the prevailing techniques and trends in money laundering and terrorist financing and the measures adopted by the Manager to combat money laundering and terrorist financing.



ComposiTion And ATTendAnCe reCord oF meeTings oF The boArd And boArd CommiTTees

Board Members

Compositionattendance Record of Meetings

in Financial Year 2013

auditCommittee

CorporateDisclosure

Committeeexecutive

Committee

Boardnumber of

Meetingsheld: 4

audit Committeenumber of

Meetingsheld: 4

Liew Cheng San Victor – Chairman – 4 N.A.Lim Ming Yan – Member Chairman 4 N.A. Chew Gek Khim 1 Chairperson – – 4 4Fong Heng Boo2 Chairman – – 4 4Christopher Gee Kok Aun3 Member – – N.A. N.A.Ng Kok Siong Member Member Member 4 4 Tony Tan Tee Hieong – – Member 4 N.A.

N.A.: Not applicable

1 Ms Chew Gek Khim resigned as an independent non-executive Director and ceased to be Chairperson of the Audit Committee with effect from 5 February 2014.

2 Mr Fong Heng Boo was appointed as Chairman of the Audit Committee with effect from 5 February 2014.

3 Mr Christopher Gee Kok Aun was appointed as an independent non-executive Director and a member of the Audit Committee with effect from 24 January 2014.


39


risk Assessment and managemententerprise risk management (erm) FrameworkRisk Management is an integral part of CRCT’s and its subsidaries’ (CRCT Group) business culture whether at a strategic or operational level. Through proactive risk management, which supports CRCT’s business objectives, value is created and preserved.

The Board of Directors of the Manager of CRCT (Board) is responsible for the governance of risk. It is assisted by the Audit Committee (AC) to provide an overview of risk management at the board level. The AC meets on a quarterly basis. The meetings are attended by the Chief Executive Officer of the Manager of CRCT as well as other key management staff.CRCT Group recognises that risk management is about opportunities as much as threats. To capitalise on opportunities, CRCT Group has to take risks.

Therefore, risk management is not about pursuing risk minimisation as a goal but rather optimising the risk-reward relationship, within known and agreed risk appetite levels. CRCT Group will therefore take risks in a prudent manner for justifiable business reasons.

CRCT Group has adopted an Enterprise Risk Management framework (ERM) that enables it to manage risks in an integrated, systematic and consistent manner. As a foundation to this framework, CRCT Group aims to create a risk-aware culture which embeds prudent risk-taking in decision-making and business processes.

A robust internal control system and an effective independent audit review process are the twin pillars that underpin the ERM framework, addressing financial, operational, compliance and information technology risks to safeguard Unitholders’ interests and the CRCT Group’s assets, and also to manage

risks. The line management is responsible for the design and implementation of effective internal controls using a risk-based approach. The Internal Audit function carries out independent reviews to test the design and implementation to provide reasonable assurance to AC on the adequacy and effectiveness of the internal control system. CRCT Group conducts assessment of its risks and control environment. Key risks and their associated controls are consolidated and reviewed at the Group level before they are presented to the AC.

CRCT Group effectively manages its risk by maintaining a prudent risk profile through a risk analysis framework that seeks to identify, measure and mitigate any key risk where possible. CRCT Group strives to achieve an optimised risk-return relationship and ensure that stakeholders’ interests and values are protected.

inde

pend

ent r

evie

w a

nd A

udit

inte

rnal

Con

trol

s sy

stem

risk-Aware Culture

erm Framework

risk strategy

board oversight & senior management involvement

Risk Identification

& Assessment

Risk Monitoring & Reporting

Risk Response

• Risks & Controls Self Assessment

• Investment Risk Evaluation

• Scenerio Analysis• Whistle-blowing/

Business Malpractice

• Key Risk Indicators

• Portfolio Monitoring of Financial Risks

• Accept• Avoid• Mitigate• Transfer

EnterpriseRisk Management


41

CRCT Group will continue to review its risk management systems and methodologies so as to proactively manage risks, preserve capital and enhance Unitholders’ value. The Manager’s key risk management principle remains its endeavour to optimise risk-reward relationship. The potential key risks include the following but are not limited to:

political and policy riskCRCT Group’s property and investments are mainly in China, which are prone to experience political risks such as political leadership uncertainty, inconsistency in public policies, social unrest and etc. Such risks could result in the deterioration of the economic or social conditions and affect the financial viability of CRCT’s investments or even the control of assets in these countries. To mitigate these risks, local operations are run by experienced management team supported by local team who are both familiar with the local conditions and culture.

property riskReal estate markets are cyclical and significantly affected by global and local conditions, such as government regulations, demand and supply, competition and consumer confidence. Stress testing and scenario analyses are performed, and all financial assumptions of project cash flows are benchmarked to ensure forecasts are objective.

Foreign exchange risk As CRCT Group’s property and investments are largely in China, it is exposed to Chinese Renminbi (RMB) flutuation against SGD which is the distribution pay out currency. As much as possible, CRCT Group maintains a natural hedge, by borrowing in RMB that match the revenue stream generated from its

investments. For non-RMB denominated term loans, CRCT Group will hedge these loans into RMB loans through non deliverable forwards so as to match its underlying assets which are denominated in RMB. In relation to its overseas investments in foreign subsidiaries whose net assets are exposed to currency translation risk and which are held for long term investment purposes, the differences arising from such translations are captured under foreign currency translation reserve. These translation differences are reviewed and monitored on a regular basis.

interest rate riskSome of CRCT Group’s existing debt carry floating interest rates, and consequently, the interest cost to CRCT Group for such loans will be subject to fluctuations in interest rates. Interest rate risk exposure relates mainly to these interest-bearing borrowings. As part of CRCT Group’s active capital management strategies, it has entered into hedging transactions to partially mitigate the risk of such interest rate fluctuations through the use of interest rate swaps and/or fixed rate borrowings. In addition, the exposure to interest rate risk is further managed through regular reviews with senior management on the optimal mix of fixed and floating rate borrowings. Debt portfolio is reviewed on an on-going basis, taking into account the investment holding period and nature of the assets. This strategy allows CRCT Group to capitalise on cheaper funding in a low interest rate environment and achieve a certain level of protection against rate fluctuations.

Credit riskCredit risk is the potential volatility in earnings caused by tenants’ failure to fulfill their contractual lease

payment obligations, as and when they fall due. There is a stringent collection policy in place to ensure that credit risk is minimised. In addition to the requirement for upfront payment of security deposit of an amount approximating three months’ rent on average (which may be lodged in the form of cash or bankers’ guarantee), CRCT Group also established vigilant monitoring and debt collection procedures.

Financial instrumentsSpeculative derivative transactions are prohibited by internal policy. While there is a need to balance hedging as a means to manage foreign exchange risk and/or interest rate risk, CRCT Group controls the use of financial instruments by setting internal guidelines on permissible hedging instruments.

Permitted hedging instruments include spot and forward contracts, currency swaps and interest rate swaps. Illiquid hedging instruments are avoided.

liquidity and refinancing riskCRCT Group actively monitors its debt maturity profile, operating cash flows and the availability of funding so as to ensure sufficient funds are available to meet its capital, refinancing and operating needs. To manage liquidity risk, CRCT Group maintains adequate levels of cash to meet its working capital obligations. In addition, CRCT Group maintains available banking facilities at reasonable level to its overall debt position. CRCT Group has access to debt market through its MTN programe, to raise funds for acquisition, development and refinancing maturing debt. Our ability to raise funds from both banks and capital markets has enabled us to diversify our sources of funding to avoid over-reliance on any single source of funding.


Investor &Media Relations

invesTor relATions & mediA CAlendAr 2013

Date event organiser

1 Feb FY 2012 results briefing to analysts and media, Singapore CRCT1 Feb FY 2012 post results luncheon, Singapore DBS Bank18 Apr Annual General Meeting CRCT19 Apr 1Q 2013 post results luncheon, Singapore Macquarie20 Jun Sector Connect seminar, Singapore SGX15 Jul Analyst briefing on proposed acquisition of CapitaMall Grand Canyon,

SingaporeCMA/CRCT

18 Jul 2Q 2013 results briefings to analysts and media, Singapore CRCT25 Jul 2Q 2013 post results luncheon, Singapore DBS Bank14 Aug CapitaLand Debt Investor Day CapitaLand22 – 23 Aug Non-deal roadshow, Hong Kong DBS Bank27 Aug ASEAN Conference Macquarie28 Aug Non-deal roadshow, Kuala Lumpur CIMB2 Sep Non-deal roadshow, Beijing China International

Capital Corporation3 Sep Non-deal roadshow, Tokyo Daiwa16 – 20 Sep Non-deal roadshows, United States and Canada DBS Bank24 Oct 3Q 2013 post results luncheon, Singapore Macquarie

We are committed to provide the investment and media communities with regular, effective, unbiased and transparent information. We continue to engage our investors actively through our wide variety of communication channels such as meetings, conference calls, roadshows, conferences and mall visits.

During the year, senior management participated in roadshows in Malaysia, Hong Kong, China, Japan, United States and Canada. We held our full-year and half-year financial results analysts and media briefings in February and July respectively. CRCT’s results, strategies and outlook were communicated during the briefings. The recordings of the results briefings are posted on our website to keep our stakeholders abreast of the latest developments of the Trust. On 18 April 2013, we held our annual general meeting. It gave us an opportunity to

have close interaction with our Unitholders.

Individual and group mall visits are arranged for investors and analysts travelling to the cities in which our malls are located. These visits offer them a first-hand experience of our malls’ operations and a greater appreciation of the long term growth potential of CRCT.

We also strive to engage our retail investors actively. On 20 June 2013, we participated in the “Sector Connect” seminar organised by Singapore Exchange (SGX). This seminar provided a conducive platform for us to showcase CRCT and connect with the retail investors.

All our latest announcements and news are promptly released to SGX-ST and published on CRCT’s website (www.capitaretailchina.com).

Unitholders and potential stakeholders have 24-hour access to CRCT’s website for information such as quarterly results, press releases, annual reports and CRCT’s unit price. An email alert service is also provided so that registered participants can receive email alerts on CRCT’s latest announcements and press releases. In addition, the public can pose questions via a dedicated “Ask Us” email address ([email protected]).

As part of our ongoing efforts to enhance our corporate governance and compliance with the regulations, we have put in place an investor relations policy to provide timely and equal access of balanced and understandable information to our Unitholders. A copy of the policy can be found on the CRCT’s website under the “Investor Relations” section.


43

uniTholder & mediA enquiriesIf you have any enquiries or would like to find out more about CRCT, please contact:

The managerMs Leng Tong YanInvestor Relations

Mr Lim Seng JinCorporate Communications

Tel: (65) 6536 1188Fax: (65) 6536 3884Email: [email protected]: www.capitaretailchina.com

The unitholder registrarboardroom Corporate & Advisory services pte. ltd.50 Raffles Place#32-01 Singapore Land TowerSingapore 048623Tel: (65) 6536 5355Fax: (65) 6536 1360Website: www.boardroomlimited.com

For depository-related matters such as change of details pertaining to Unitholders’ investment records,please contact:

The Central depository (pte) limited4 Shenton Way#02-01 SGX Centre 2Singapore 068807Tel: (65) 6535 7511Fax: (65) 6535 0775Email: [email protected]: www.sgx.com/cdp

FinAnCiAl CAlendAr 2014 – 2015 (TenTATive)

April 2014• 2014 First Quarter

Results Announcement

• Annual General Meeting

july 2014• 2014 Second Quarter


september 2014• 2014 First Half Distribution

to Unitholders

october 2014• 2014 Third Quarter


january 2015• 2014 Full Year


march 2015• 2014 Second Half Distribution

to Unitholders

AnAlysT CoverAge (As AT 3 mArCh 2014)

• Bank of America Merrill Lynch • China International Capital

Corporation

• Daiwa Capital Markets

• DBS Bank

• J.P. Morgan Securities

• Macquarie Captial Securities

• OCBC Investment Research

• Standard Chartered Bank

• UBS Securities


Highest Unit Price (S$) 1.856

Lowest Unit Price (S$) 1.290

Average Closing Unit Price (S$) 1.536

Opening Unit Price on 2 January 2013 (S$) 1.645

Closing Unit Price on 31 December 2013 (S$) 1.330

Turnover (million units) 288.9

Unit Price Performance

CrCT TrAding dATA in Fy 2013

CrCT monThly TrAding perFormAnCe in Fy 2013

2.5 50

2.0 40

1.5 30

1.0 20

0.5 10

0 0Jan 13 Feb 13 Mar 13 Apr 13 May 13 Jun 13 Jul 13 Aug 13 Sep 13 Oct 13 Nov 13 Dec 13

Closing unit price as at end of month (S$) 1.747 1.782 1.742 1.677 1.558 1.403 1.523 1.339 1.369 1.395 1.410 1.330

Trading volume (million units) Closing Unit Price as at end of the month (S$)

31.6

43.4

12.2

15.518.2

26.1

17.9

28.0

38.9

13.1 12.8

31.2


45

1 Based on the actual distribution per unit of 9.02¢ for FY 2013 and the unit closing price of S$1.33 on 31 December 2013.2 Singapore Government 10-year bond yield as at 31 December 2013.3 China Government 10-year bond yield as at 31 December 2013.4 Average 12-month gross dividend yield of Straits Times Index stocks as at 31 December 2013.5 Average 12-month gross dividend yield of Straits Times Real Estate Index as at 31 December 2013.6 Prevailing CPF Ordinary Account savings rate.7 Average 12-month S$ fixed deposit savings rate as at December 2013.

CRCT Yield 1 FSSTI Yield 4Singapore 10-year Govt Bond Yield 2

FSTRE Yield 5China 10-year Govt Bond Yield 3

CPF OrdinaryAccount 6

12-month Fixed (S$) Deposit 7

3.32.5

6.8

2.6

4.6

3.7

0.3

CompArATive yields (%)

as at 31 December 2013

Sources: Bloomberg, CRCTML, Central Provident Fund (CPF) Board, Monetary Authority of Singapore.

20%

15%

10%

5%

0%

-5%

-10%

-15%

-20%

-25%

% ChAnge in uniT priCe/index vAlue

Jan2013

Jul2013

Mar2013

Sep2013

May2013

Nov2013

Feb2013

Aug2013

Apr2013

Oct2013

Jun2013

Dec2013

Dec2012

CRCT Straits Times Index (FSSTI) FTSE Straits Times REIT Index (FSTREI) Shanghai Exchange Composite Index (SHCOMP)


Minzhongleyuan in Wuhan, CapitaMall Qibao in Shanghai, CapitaMall Saihan and CapitaMall Wuhu took part in the programme.Besides My Schoolbag, our malls lent their support to a variety of community causes throughout the year. CapitaMall Xizhimen partnered the International Fund for Animal Welfare to organise an exhibition highlighting the plight of wild animals at risk of extinction from excessive hunting. In conjunction with the International White Cane Safety Day – a day set aside to celebrate the achievements of the visually impaired or blind – the mall also held a special performance in October 2013 helmed by celebrity blind piano tuner Chen Yan, which incorporated messages about showing care and concern for the visually impaired.

In addition, CapitaMall Wuhu spread the Chinese Mid-Autumn Festival cheer to 30 underprivileged children by inviting them to spend a fun-filled day at the mall. On a longer-term basis, CapitaMall Qibao has set aside space for a small rooftop farm catering to children, which it hopes will help cultivate a respect and love for nature among children growing up in the city.

Corporate SocialResponsibility

green prACTiCesWe remain committed to the protection of our environment for our future generations and constantly seek to minimise the environmental impact of our malls’ operations. Throughout the year, our malls engaged different stakeholders in a wide range of activities that increased awareness of climate change.

Reiterating our support for Earth Hour, the global movement to raise awareness of climate change, six of our malls – CapitaMall Xizhimen, CapitaMall Wangjing, CapitaMall Minzhongleyuan, CapitaMall Qibao, CapitaMall Saihan and CapitaMall Wuhu – turned off façade and non-essential lights for 10 hours from 8.30 pm on Saturday, 23 March 2013.

In conjunction with Earth Hour 2013, our malls held a variety of events to raise awareness of climate change. CapitaMall Xizhimen held “live” unplugged musical performances and an eco knowledge quiz, while CapitaMall Saihan organised an event aimed at reducing wastage by facilitating shoppers to exchange their pre-loved items with one another. In addition, CapitaMall Saihan held a mass cycling event to promote cycling as a healthy and green form of transport, and CapitaMall Wuhu organised a competition whereby children created eco-friendly artwork using recycled objects. Such green-themed activities helped to rally our shoppers to champion the environment.

In recognition of the integral role that our malls play in the communities they serve, we continued to fulfill our responsibilities as a corporate citizen by promoting community causes and pursuing green practices that contribute towards sustainable development.

supporTing CommuniTy And ChAriTy CAuses“My Schoolbag”, CapitaMalls Asia’s signature annual corporate social responsibility programme, took place in China for the fourth consecutive year in September 2013, which marked the beginning of the academic year for Chinese pupils. Held in partnership with the China Foundation for Poverty Alleviation, new schoolbags and stationery were given to over 19,000 first grade students from over 200 schools in 21 provinces, municipalities and autonomous regions, including students from 19 CapitaLand Hope Schools. The China programme was made possible with a donation of about S$280,000 from CapitaLand Hope Foundation, the philanthropic arm of CapitaLand. Staff volunteers from CapitaMall Xizhimen and CapitaMall Wangjing in Beijing, CapitaMall


47

cash bonuses and long-term equity-based reward plans such as restricted shares for managers. Such equity-based reward plans aim to bridge reward and performance, as well as to retain talent. We also conduct regular benchmarking exercises to ensure that we remain competitive to continue to attract and retain talent.

developing our peopleWe strongly believe in providing training and development opportunities for our employees to expand their capabilities and realise their potential. In collaboration with CapitaMalls Asia, we provide our employees a suite of training and development programmes to gain relevant knowledge and skills to achieve business excellence.

Other than classroom trainings, our employees are encourage to participate in e-training at their own time and pace via our online learning platform iCampus, which carries more than 200 courses in English and Chinese.

We also organise overseas study visits for our employees so that they can gain exposure, learn from other mall operators, as well as network with industry players.

People & TalentManagement

To help integrate and ease new employees into our culture and system, we have put in place structured programmes such as the new hire orientation programme on iCampus where they can gain knowledge of company information, policies and processes. In addition, within their first three months of service, they will be invited to attend a four-day Boot Camp to allow them to gain deeper insights into our management philosophy, core values, business strategy and operations. It also provides a platform for new employees to network and interact with colleagues from other malls and functions.

For members of the senior management team, we partner with CapitaLand Institute of Management and Business (CLIMB) for leadership and management programmes to sharpen their management, leadership and business skills.

engAging our peopleRegular recreational, team-building and networking events are organised as part of our concerted efforts to engage our employees in China. Staff communication sessions by senior management are also conducted on a regular basis to keep our employees abreast of CRCT’s financial results and strategic business thrusts.

CAring For our peopleWe value and care for our people as we believe our success will be shaped by them. We will continue to develop our human capital to achieve optimal performance.

We recognise that people are our greatest asset and they contribute to the success of the organisation. With an integrated human capital strategy, we are committed to develop and grow our people.

TAlenT mAnAgemenTWe constantly seek talents to meet the resourcing requirements in China to support our business growth. To build our bench strength and talent pipeline for leadership succession planning, we attract young talents to join our Management Associate Programme and Graduate Development Programme through our network with various distinguished China and overseas universities. We also recruit talents at different transition points in their career paths, from young, mid-career professionals to industry veterans.

We leverage on our scale to provide a platform for cross fertilisation where employees have the opportunity to rotate to different malls, functions, cities or countries as part of their career development.

CompeTiTive CompensATion And beneFiTsWe offer comprehensive and competitive remuneration packages which includes short-term


inTegrATed reTAil reAl esTATe mAnAgemenT plATForm

GrowthStrategies

Retail Real Estate Management Retail Real Estate Capital Management

PropertyManagement

Retail Management & operationalleasing

StrategicMarketing

Design &DevelopmentManagement

assetManagement

StrategicPlanning &Investment

FundStructuring &Management

Retail Real estate Unitholders

DistributionsNet Property Income

InvestmentOwnership

As The mAnAger, we seek To drive ConTinued growTh oF CrCT Through The Following Three-pronged sTrATegy:

1. enhancing organic growth through proactive Asset managementMost of our leases provide for an annual step-up in the base rent and for rent to be payable on the basis of the higher of either base rent or a percentage of tenants’ gross sales turnover, thereby providing stability and potential upside in rental income.

Apart from organic growth through rental receipts, we work closely with the mall managers to identify improvements to the malls’ retail offerings and tenant mix, and carry out marketing and promotional initiatives to drive up shopper traffic and non-rental income.

2. Creating new value through innovative Asset enhancement strategiesWe also actively explore innovative asset enhancement initiatives to improve the returns of our malls. These include the reconfiguration of the retail units or floor plates to achieve better efficiency and higher rental potential, and retro-fitting and refurbishing the malls to maintain their appeal to tenants and shoppers.

3. Capitalising on yield-Accretive Acquisitions growth modelWe are always identifying and evaluating yield-accretive acquisition opportunities from our secured and proprietary pipeline, and other third-party vendors.

CRCT is provided with long-term growth potential from its rights of first refusal to purchase

assets held by CapitaMalls Asia sponsored private funds – CapitaMalls China Income Fund, CapitaMalls China Income Fund II (previously known as CapitaMalls China Incubator Fund), CapitaMalls China Income Fund III (previously known as CapitaMalls China Development Fund II), CapitaMalls China Development Fund III, as well as CapitaMalls Asia, one of the largest listed shopping mall developers, owners and managers in Asia.

In evaluating acquisition opportunities, we will focus on properties which can maintain or enhance CRCT’s distribution yield; the properties’ potential asset enhancement opportunities; and properties with potential to demonstrate strong growth in occupancy rates, sustainable rental yields, and quality tenant and lease profiles.

CRCT enjoys access to CapitaMalls Asia’s integrated shopping mall business model, with in-house capabilities in retail real estate investment, development, mall operations, asset management and fund management.

Business Review

49

OperationsReview

CommiTTed oCCupAnCy rATes

as at 31 Dec 2013 % 1

as at 31 Dec 2012 % 1

CapitaMall Xizhimen 98.3 94.8CapitaMall Wangjing 99.0 99.5CapitaMall Grand Canyon 95.9 N.A.CapitaMall Qibao 97.1 97.4CapitaMall Saihan 99.9 99.9CapitaMall Wuhu 90.9 2 90.3CapitaMall Anzhen 100.0 100.0CapitaMall Erqi 100.0 100.0CapitaMall Shuangjing 100.0 100.0CapitaMall Minzhongleyuan N.A. 3 81.3CRCT Portfolio 98.2 97.2

N.A.: Not Applicable1. Based on committed leases. 2. Tenancy adjustment on Level one and four of CapitaMall Wuhu. 3. CapitaMall Minzhongleyuan is excluded as it is undergoing asset enhancement works.

shopper TrAFFiC 1

2013 Million

2012 Million

CapitaMall Xizhimen 34.9 31.7CapitaMall Wangjing 10.6 10.1CapitaMall Grand Canyon N/A 2 –CapitaMall Qibao 11.5 11.2CapitaMall Saihan 8.4 8.0CapitaMall Wuhu 7.9 8.6CapitaMall Minzhongleyuan N.A. 2 7.6CRCT Portfolio 73.3 77.2

N.A.: Not Applicable1. CapitaMall Anzhen, CapitaMall Shuangjing and CapitaMall Erqi do not have traffic counters.2. CapitaMall Grand Canyon is excluded as its acquisition was completed on 30 December 2013. CapitaMall Minzhongleyuan is excluded as it is undergoing

asset enhancement works.

1. Based on tenants’ sales (excluding Department Stores and Supermarkets) from CapitaMall Xizhimen, CapitaMall Wangjing, CapitaMall Qibao, CapitaMall Saihan and CapitaMall Wuhu. Prior year numbers have been restated for comparative purposes.

1,3841,530

4Q1Q

1,192 1,327

2Q

1,2381,356

3Q

1,328 1,403

porTFolio TenAnT sAles (RMB per square metre) 1

2012 2013


OperationsReview

new leAses And renewAls

number of new leases/ Renewals in

FY 2013

1

variance over Preceding Rental %

2,3

CapitaMall Xizhimen 145 12.2CapitaMall Wangjing 130 22.6CapitaMall Qibao 88 6.4CapitaMall Saihan 106 13.2CapitaMall Wuhu 95 (1.1) 4

CRCT Portfolio 5 564 13.8

1 Excluding new leases at newly created lettable area. 2 Excluding turnover rent component.3 Majority of leases have rental escalation clauses.4 Mainly due to new tenants at Level one rented at lower fixed rate compared to preceding rent. CRCT’s stake in CapitaMall Wuhu is 51%. 5 CapitaMall Grand Canyon was excluded as acquisition was completed on 30 December 2013. CapitaMall Minzhongleyuan was excluded as it is

undergoing asset enhancement works.

weighTed AverAge leAse expiry by mAll


Weighted expiry

(by Total Rental Income) Years

Weighted expiry

(by GRa) Years

CapitaMall Xizhimen 2.8 5.3CapitaMall Wangjing 3.5 7.6CapitaMall Grand Canyon 3.5 9.2CapitaMall Qibao 3.1 5.1CapitaMall Saihan 3.7 6.9CapitaMall Wuhu 2.9 5.1CapitaMall Anzhen 11.6 11.6CapitaMall Erqi 12.9 12.9CapitaMall Shuangjing 9.3 9.9CRCT Portfolio 1 4.8 8.3

1 CapitaMall Minzhongleyuan is excluded as it is undergoing asset enhancement works.

leAse expiry proFileCapitaMall Anzhen, CapitaMall Erqi and the majority of the Gross Rentable Area (GRA) of CapitaMall Shuangjing are let out under master leases. The master leases are long-term with a typical tenure of 20 years, which help to ensure stable cash flows. For tenants which are not under master leases, the typical lease term is 15 to 20 years for anchor tenants, five to seven years for mini-anchor tenants and up to three years for specialty tenants.

Business Review

51

leAse expiry proFile For 2014 by mAll 3


GRa Total Rental Income/Month number of

leases 1 sq m% of

Total RMB’000

% of Total 2

CapitaMall Xizhimen 115 14,146 17.0 4,697 22.2CapitaMall Wangjing 137 13,078 19.2 5,363 33.9CapitaMall Grand Canyon 96 7,681 11.0 2,062 21.2CapitaMall Qibao 77 7,385 10.2 1,951 25.4CapitaMall Saihan 133 12,070 28.8 1,881 44.4CapitaMall Wuhu 107 5,278 11.6 1,162 40.3

1 Based on all committed leases as of 31 December 2013. 2 As percentage of total rental income for the month of December 2013.3 CapitaMall Minzhongleyuan is excluded as it is undergoing asset enhancement works.

porTFolio leAse expiry proFile (%)


67.5

38.2

Beyond 20172015

9.7

21.1

2014

10.5

22.5

2016

6.6

13.1

2017

3.75.1

% of Total GRA1 % of Total Rental Income for the month of December 20131



TrAde seCTor AnAlysis (%)


OperationsReview

By Total Rental Income1 (%)

Fashion & Accessories 28.8

Food & Beverages 20.7

Department Store 14.8

Supermarket 9.9

Beauty & Healthcare 7.2

Shoes & Bags 3.2

Education 2.7

Houseware & Furnishings 2.5

Leisure & Entertainment 1.9

Others 8.3

By GRA (%)

Fashion & Accessories 11.3

Food & Beverages 11.6

Department Store 30.1

Supermarket 28.5

Beauty & Healthcare 4.4

Shoes & Bags 1.1

Education 1.7

Houseware & Furnishings 4.3

Leisure & Entertainment 3.2

Others 3.8

committed leases with turnover rent provisions (%)

87.0

committed leases without turnover rent provisions (%)

13.0

committed leases with turnover rent provisions (%)

72.4

committed leases without turnover rent provisions (%)

27.6

% of Commited Leases with

Turnover Rent Provisions

By Total Rental Income1

% of Commited Leases with

Turnover Rent Provisions

By Total GRA

Turnover renTCRCT’s favourable lease structure helps to provide Unitholders with a stable and growing rental cash flow.

Most of the leases for the anchor, mini-anchors and specialty tenants have an annual step-up in the base rent. In addition, most of the leases also contain provisions for rent to

be payable at the then applicable base rent or at a percentage of sales turnover, whichever is the higher.

The combination of direct point-of-sales systems, system link-up with tenants’ point-of-sales and central cashier systems at our malls allows us to keep track of tenants’ sales. The long-term master leases at

CapitaMall Anzhen, CapitaMall Erqi and CapitaMall Shuangjing contain provisions for upside in rental revenues through step-ups in the base rent. In addition, the master leases at CapitaMall Anzhen and CapitaMall Erqi provide further potential upside through a percentage of tenants’ sales turnover if the turnover exceeds an agreed threshold.


Business Review

53

Top 10 TenAnTs

(Based on percentage of Total Rental Income 1 in the month of December 2013)

The portfolio’s biggest tenant is Beijing Hualian Group which operates the master-leased Beijing Hualian Department Stores at CapitaMall Anzhen and CapitaMall Erqi. It is also the anchor tenant at CapitaMall Xizhimen, CapitaMall Wangjing and CapitaMall Saihan.

Tenant Brand names Trade Sectorlease

expiry 2GRa sq m

%committed

GRa %

% TotalRental

Income %

1

BHG(北京)百货有限公司北京华联呼和浩特金宇综合超市有

限公司北京华联综合超市股份有限公司华联咖世家(北京)餐饮管理有限

公司

Beijing Hualian Department Store

Beijing Hualian Supermarket

Costa Coffee

Department Store

Supermarket

Food & Beverages

Nov/2014Feb/2015Sep/2015Jan/2017Jul/2025

Nov/2026Sep/2028Jun/2029

201,590 41.3 22.9

上海联家超市有限公司3

北京家乐福商业有限公司3Carrefour Supermarket Jan/2024

Mar/202452,123 10.7 4.0

绫致时装(天津)有限公司 Only Jack & Jones Vero ModaSelected

Fashion &Accessories

Feb/2014Apr/2014

Dec/2014May/2015Sep/2015Oct/2015Nov/2015Dec/2015Jan/2016Mar/2016

6,113 1.3 3.5

迅销(中国)商贸有限公司优衣库商贸有限公司

UNIQLO Fashion &Accessories

Jan/2014Apr/2016Nov/2018

Aug/2020

6,584 1.3 2.4

北京百安居装饰建材有限公司 B&Q Houseware &Furnishings

Apr/2024 17,429 3.6 1.8

北京必胜客比萨饼有限公司3

北京肯德基有限公司3

天津肯德基有限公司3

上海肯德基有限公司3

Pizza HutKFC

Food & Beverages Apr/2017May/2017Sep/2017Sep/2018Dec/2021Apr/2022

4,109 0.8 1.7


OperationsReview

Top 10 TenAnTs

(Based on percentage of Total Rental Income 1 in the month of December 2013)

Tenant Brand names Trade Sectorlease

expiry 2GRa sq m

%committed

GRa %

% TotalRental

Income%

1

北京为之味餐饮有限公司3

富迪康(北京)餐饮管理有限公司3夹拣成厨麻辣烫姑姑宴川成元麻辣香锅港仔码头港仔驿栈金汤玉线

Food & Beverages Mar/2014Apr/2014Sep/2014Nov/2014Feb/2015Mar/2016May/2016Sep/2016Nov/2016Apr/2017

Nov/2018

2,995 0.6 1.7

北京拉夏乐微服饰有限公司拉夏贝尔服饰(太仓)有限公司上海拉夏贝尔服饰股份有限公司

La Chapelle Fashion & Accessories

Mar/2014 Feb/2015Dec/2017Feb/2018

7,806 1.6 1.0

北京英龙华辰科技有限公司 Apple Information & Technology

Jun/2015Jan/2016

Sep/2016

723 0.1 0.9

彩盈商贸(上海)有限公司彩盈储贤商贸(北京)有限公司

b+abizzueI.T

Fashion &Accessories

Feb/2014Nov/2014

Jul/2015Aug/2016

1,212 0.2 0.9

1 CapitaMall Minzhongleyuan and CapitaMall Grand Canyon are excluded.2 Some of the tenants have signed more than one tenancy agreement and this has resulted in more than one lease expiry date for such tenants. 3 Under the same group of companies respectively.

Business Review

55

FinancialReview

In RMB terms, FY 2013 gross revenue for the portfolio was RMB795.0 million, an increase of 3.5% over FY 2012. Gross revenue increased at all malls except for CapitaMall Minzhongleyuan, which was closed for asset enhancement works since July 2013. Multi-tenanted malls contributed RMB52.0 million increase due to rental growth, improved occupancies and higher tenant sales. Gross revenue in SGD terms in FY 2013 increased by S$7.5 million, 4.9% over FY 2012.

1 The financial period from 1 January 2013 to 31 December 2013. 2 The financial period from 1 January 2012 to 31 December 2012.3 CapitaMall Minzhongleyuan was closed for asset enhancment initiatives (AEI) since July 2013.

FY 2013 S$’000

1 FY 2012 S$’000

2 % Change

FY 2013 RMB’000

1 FY 2012 RMB’000

2 % Change

MUlTI-TenanTeD MallS

CapitaMall Xizhimen 48,596 43,911 10.7 241,352 221,090 9.2CapitaMall Wangjing 36,871 33,235 10.9 183,118 167,335 9.4CapitaMall Qibao 17,813 16,452 8.3 88,468 82,837 6.8CapitaMall Saihan 9,962 8,107 22.9 49,474 40,820 21.2CapitaMall Wuhu 7,043 6,623 6.3 34,978 33,347 4.9

120,285 108,328 11.0 597,390 545,429 9.5

MaSTeR-leaSeD MallS

CapitaMall Anzhen 16,262 15,881 2.4 80,766 79,961 1.0CapitaMall Erqi 10,084 9,824 2.6 50,082 49,465 1.2CapitaMall Shuangjing 8,866 8,454 4.9 44,033 42,566 3.4

35,212 34,159 3.1 174,881 171,992 1.7

aeI Mall

CapitaMall Minzhongleyuan 3 4,578 10,051 (54.5) 22,738 50,606 (55.1)Total 160,075 152,538 4.9 795,009 768,027 3.5

gross revenue by properTy

CapitaMall Xizhimen 28.8CapitaMall Wangjing 21.8 CapitaMall Qibao 10.8CapitaMall Saihan 5.3CapitaMall Wuhu 4.4CapitaMall Anzhen 10.4 CapitaMall Erqi 6.4 CapitaMall Shuangjing 5.5 CapitaMall Minzhongleyuan3 6.6

Gross RevenueBy PropertyFY 2013 1 (%)

Gross RevenueBy PropertyFY 2012 2 (%)

CapitaMall Xizhimen 30.4CapitaMall Wangjing 23.0CapitaMall Qibao 11.1CapitaMall Saihan 6.2CapitaMall Wuhu 4.4CapitaMall Anzhen 10.2 CapitaMall Erqi 6.3CapitaMall Shuangjing 5.5 CapitaMall Minzhongleyuan3 2.9


In RMB terms, NPI for FY 2013 increased by RMB9.9 million, 2.0% over FY 2012. FY 2013 recorded higher NPI for all malls (except CapitaMall Minzhongleyuan and CapitaMall Wuhu). NPI of the multi-tenanted malls in first-tier city, CapitaMall Xizhimen and CapitaMall Wangjing increased by 5.8% and 8.8% respectively over previous year. NPI at CapitaMall Qibao and CapitaMall Saihan increased by 10.7% and 33.2% respectively over previous year. The master-leased malls, CapitaMall Anzhen, CapitaMall Erqi and CapitaMall Shuangjing also showed stable year-on year growth of 1.0%, 4.5% and 4.6% respectively.

FinancialReview

1 The financial period from 1 January 2013 to 31 December 2013. 2 The financial period from 1 January 2012 to 31 December 2012.3 CapitaMall Minzhongleyuan was closed for asset enhancment initiatives (AEI) since July 2013.

npi by properTy

FY 2013 S$’000

1 FY 2012 S$’000

2 % Change

FY 2013 RMB’000

1 FY 2012 RMB’000

2 % Change

MUlTI-TenanTeD MallS

CapitaMall Xizhimen 32,649 30,431 7.3 162,153 153,218 5.8CapitaMall Wangjing 26,007 23,573 10.3 129,164 118,691 8.8CapitaMall Qibao 7,270 6,477 12.2 36,102 32,612 10.7CapitaMall Saihan 5,171 3,829 35.0 25,681 19,281 33.2 CapitaMall Wuhu 2,911 2,902 0.3 14,458 14,611 (1.0)

74,008 67,212 10.1 367,558 338,413 8.6

MaSTeR-leaSeD MallS

CapitaMall Anzhen 13,319 13,004 2.4 66,149 65,477 1.0CapitaMall Erqi 7,963 7,518 5.9 39,549 37,855 4.5CapitaMall Shuangjing 7,073 6,670 6.0 35,126 33,581 4.6

28,355 27,192 4.3 140,824 136,913 2.9

aeI Mall

CapitaMall Minzhongleyuan 3 675 5,272 (87.2) 3,353 26,544 (87.4)Total 103,038 99,676 3.4 511,735 501,870 2.0

CapitaMall Xizhimen 30.5CapitaMall Wangjing 23.7CapitaMall Qibao 6.5CapitaMall Saihan 3.8CapitaMall Wuhu 2.9CapitaMall Anzhen 13.1CapitaMall Erqi 7.5CapitaMall Shuangjing 6.7CapitaMall Minzhongleyuan 3 5.3

NPIBy PropertyFY 2013 1 (%)

NPIBy PropertyFY 2012 2 (%)

CapitaMall Xizhimen 31.7 CapitaMall Wangjing 25.2 CapitaMall Qibao 7.1CapitaMall Saihan 5.0CapitaMall Wuhu 2.8CapitaMall Anzhen 12.9CapitaMall Erqi 7.7CapitaMall Shuangjing 6.9CapitaMall Minzhongleyuan3 0.7

Business Review

57

valuation2013

RMB million 1

valuation2012

RMB million 2

valuation 2013 (in per sq m

of GRa 3) RMB

Property

Yield 2013 %

4 valuation 2013 S$ million

1 valuation 2012 S$ million

2

CapitaMall Xizhimen 2,600 2,449 31,297 6.2 532.2 475.0CapitaMall Wangjing 1,900 1,690 27,937 6.8 388.9 327.8CapitaMall Grand Canyon 1,882 – 26,895 – 385.2 –CapitaMall Qibao 472 420 6,490 7.6 96.6 81.5CapitaMall Saihan 362 322 8,632 7.1 74.1 62.4CapitaMall Wuhu 251 228 5,500 5.8 51.4 44.2CapitaMall Anzhen 949 940 21,845 7.0 194.3 182.3CapitaMall Erqi 590 583 6,388 6.7 120.8 113.1CapitaMall Shuangjing 543 533 10,978 6.5 111.2 103.4CapitaMall Minzhongleyuan 504 449 13,047 0.7 103.2 87.1Total 10,053 7,614 – 6.3 2,057.9 1,476.8

1 The valuation of CapitaMall Anzhen, CapitaMall Shuangjing, CapitaMall Qibao, CapitaMall Saihan and CapitaMall Wuhu were conducted by CBRE, while the valuation for CapitaMall Xizhimen, CapitaMall Wangjing, CapitaMall Erqi and CapitaMall Minzhongleyuan were conducted by Colliers as at 31 December 2013. The valuation of CapitaMall Grand Canyon as at 31 December 2013 was based on management valuation as the acquisition of the mall was completed on 30 December 2013.

2 The valuation of CapitaMall Xizhimen, CapitaMall Minzhongleyuan, CapitaMall Qibao, CapitaMall Saihan and CapitaMall Wuhu were conducted by CBRE, while the valuation for CapitaMall Wangjing, CapitaMall Anzhen, CapitaMall Erqi and CapitaMall Shuangjing were conducted by Colliers as at 31 December 2012.

3 Gross rentable area (GRA).4 Property yield is calculated based on NPI for 1 January 2013 to 31 December 2013 and the valuation as at 31 December 2013. CapitaMall Grand Canyon NPI

yield is excluded as the mall was acquired on 30 December 2013.

S$’000

Investment Properties as at 31 December 2013 2,058,094 1

Surplus on revaluation for FY 2013 99,159

1 The carrying amount of the investment properties include the valuation of the 10 retail malls and the carrying amount of CapitaMall Minzhongleyuan’s three residential units.

vAluATion And properTy yield oF porTFolio


CapitalManagement

As at 31 December 2013, CRCT maintained the following debt facilities: rmb denominated facilities – • the RMB102.4 million three-year

unsecured term loan facility• the RMB540.0 million one-year

bridge loan facility• the RMB520.0 million five-year

secured term loan facilitys$ denominated facilities – • the S$151.0 million money

market line facilities• the S$100.0 million four-year

trust term loan facility• the S$88.0 million three-year

trust term loan facility• the S$50.0 million three-year

trust term loan facility• the S$50.0 million four-year

trust term loan facility• the S$50.5 million four-year

trust term loan facility• the S$50.0 million five-year

trust term loan facility• the S$150 million five-year

trust term loan facilitiesus$ denominated facility – • the US$50.0 million money

market line facilitymulticurrency medium Term notes –• the S$500.0 million

multicurrency Medium Term Notes (MTN) programme

CRCT has sufficient untapped facilities which include S$500.0 million from the MTN, term loans facilities of S$103.0 million and money market line facilities of S$111.0 million and US$50.0 million. Current gearing for CRCT is at 32.6% (below the MAS requirement of 35%) with a total outstanding debt of S$713.5 million.

CRCT’s effective capital management includes hedging its currency and interest rate risk exposures. Other than the natural hedge where loans were borrowed in RMB, CRCT also hedges its non-RMB denominated loans.

The fair value derivative for FY 2013, which was included as financial derivatives in total assets and total liabilities were S$2.0 million and S$5.2 million respectively. This net amount represented a negative 0.3% of the net assets of CRCT as at 31 December 2013.

In June 2013, CRCT has successfully refinanced majority of the debt which matured in 2013 and kept average cost of debt at 2.6%.

Debt maturity each year as a percentage of total outstanding debt as at 31 December 2013 is as follows:

This provides a currency match against CRCT’s assets which are predominately denominated in RMB. However, CRCT does not hedge the equity largely denominated in RMB as it is of the view that such equity investments are long term. CRCT will hedge the RMB cash flow from operations if it is determined with certainty the exact timing in which they will be remitted back to Singapore for distribution purpose. As at 31 December 2013, CRCT has hedged its non-RMB loans through non-deliverable forwards (NDF) with notional amount of S$526.0 million which represent 73.7% (including RMB denominated loans) of the total outstanding debt.

debT mATuriTy proFile 1 (S$ million)


1 Total debt excluding interest and upfront fees. 2 Comprise of multiple term loans drawn in Singapore at the Trust level, these include fixed and/or

floating term loan facilities. 3 Comprise of multiple floating rate money market facilities.4 Secured loans comprise of a RMB term loan of S$106.5 million (RMB520 million) and a RMB bridge

loan of S$110.5 million (RMB540 million). Both loans are secured by a legal mortgage over CapitaMall Grand Canyon, bear interest referenced against the 3 to 5 years People’s Bank of China (PBOC) base lending rate and 1 year PBOC base lending rate respectively. The secured RMB term loan is payable on a semi-annual basis from June 2014. Outstanding loan will be repaid on final maturity on 19 December 2018. The bridge loan is payable within 1 year from the drawdown date.

5 5% of the RMB term loan is repayable on a semi-annual basis, starting in 2012. The remaining 80% of the RMB loan principal is payable in full upon maturity of the RMB term loan on 30 June 2014.

Fixed Rate CapitaMall Grand Canyon Secured-Onshore Loan 4

Variable Rate CapitaMall Grand Canyon Secured Onshore Short Term Bridge Loan 4

Trust-Unsecured Offshore Term Loan 2 CapitaMall Anzhen Unsecured-Onshore Loan 5

Trust-Unsecured Money Market Line 3 Amortisation Payment on CapitaMall Grand Canyon Secured Onshore Term Loan

Total Debt (S$million) 713.5 276.6 93.1 105.1 55.6 183.1% of Outstanding Debt 38.8% 13.0% 14.7% 7.8% 25.7%

39.0%

61.0% 21.0

40.0100.0

110.5

88.05.1

100.05.1

50.55.1

86.1

97.0

5.1

Total Debt 2014 2015 2016 2017 2018

Business Review

59

key FinAnCiAl indiCATors


Unencumbered Assets to Assets as % of Total Assets 90.1%Gearing 1 32.6%Net Debt/EBITDA (times) 2 7.4Interest Coverage (times) 3 8.5Average Term to Maturity (Years) 2.38Average Cost of Debt 4 2.6%

1 The gearing is calculated based on total outstanding debt over total assets. Total assets included the hedging effects on net assets denominated in Renminbi (RMB).

2 Net debt comprises gross debt less transaction costs and EBITDA refers to earnings before interest, tax, depreciation and amortisations excluding change in fair value of financial derivatives, investment properties and unrealised foreign exchange gain or loss.

3 Ratio of net income before change in fair value of financial derivative, investment properties and unrealised foreign exchange gain or loss at CRCT Group over interest expense incurred in FY 2013.

4 Ratio of interest expense over weighted average debt.

As at 31 December 2013, 38.8% or S$276.6 million of CRCT’s debt will mature in 2014. This includes the additional loans that were taken up due to the acquisition of CapitaMall Grand Canyon. The Manager continues to adopt a prudent and proactive approach to capital management and plans to repay the bridge loan of S$110.5 million by 2014. Discussions on refinancing of the remaining loans with the banks will commence soon.

Cash Flows and liquidity CRCT takes a proactive role in monitoring its cash and liquid reserves to ensure adequate funding is available for distribution to the Unitholders as well as to meet any short-term liabilities. operating Activities Operating net cash flow for FY 2013 was S$68.6 million, an increase of S$11.3 million over the operating cash flow of S$57.3 million in the preceding financial year. This was mainly due to the lower income tax as compared

to payment made in FY 2012 in relation to the foreign exchange gain arising from the revaluation gain from the shareholder’s loan principal and interest which were redenominated from RMB to USD.

investing Activities CRCT adheres to stringent criteria when evaluating potential acquisitions. This involves a thorough review of risks and return and to overall add value to the existing portfolio and future growth expectation. CRCT had completed its acquisition of CapitaMall Grand Canyon on 30 December 2013. CRCT will constantly look out for new acquisition opportunities.

Financing Activities CRCT continues to adopt a prudent and proactive approach to monitor the cash position and level of borrowings to ensure a healthy cash position to finance its operations. CRCT will also tap on the capital and debt market to facilitate any new acquisitions.

Cash and Cash equivalents As at 31 December 2013, the value of the cash and cash equivalents of CRCT stood at S$105.5 million compared to S$140.5 million as at 31 December 2012. CRCT had raised capital from preferential offering of S$59.0 million and private placement of S$86.1 million on 20 November 2013 and 2 November 2012 respectively. S$139.7 million out of the total net proceeds of S$140.8 million from both the preferential offering and private placement had been used to fund the acquisition of CapitaMall Grand Canyon. This is in accordance with the stated use of the net proceeds from the preferential offering and private placement and all the net proceeds had been fully utilised as at 31 December 2013. In addition, S$8.7 million of the cash retained from the Distribution Reinvestment Plan on 25 September 2013 had been used to repay short term borrowings and finance cost.

Forging Ahead Proactive asset management to stay ahead of changing market trends provides strong boost to organic growth.


CapitaMall xizhimen凯德MALL•西直门

CapitaMall Wangjing凯德MALL•望京

CapitaMall Grand Canyon

凯德MALL•大峡谷CapitaMall Qibao

凯德七宝购物广场CapitaMall Saihan

凯德MALL•赛罕CapitaMall Wuhu

凯德广场•芜湖CapitaMall anzhen

凯德MALL•安贞CapitaMall erqi

凯德广场•二七

CapitaMall Shuangjing

凯德MALL•双井

CapitaMall Minzhongleyuan

新民众乐园

address No. 1 Xizhimenwai Avenue,

Xicheng District, Beijing

No. 33 Guangshun North

Street, Blk 213 & 215, Chaoyang District,

Beijing

No. 16 South Third Ring West Road, Fengtai District,

Beijing

No. 3655, Qi Xin Road,

Minhang District,Shanghai

No. 26 Ordos Street,

Saihan District,Huhhot, Inner

MongoliaAutonomous Region

No. 37 ZhongshanNorth Road,

Xinwu District, Wuhu, Anhui

Section 5 No. 4 of

Anzhen Xi Li, Chaoyang District,

Beijing

No. 3 Minzhu Road,

Erqi District, Zhengzhou,

Henan Province

No. 31 Guangqu Road,

Chaoyang District,Beijing

No. 704 Zhongshan Avenue,

Jianghan District, Hankou Wuhan, Hubei Province

GFa (sq m)(as at 31 December 2013)

83,075 83,768 96,821 83,986 41,938 59,624 43,443 92,356 49,463 41,717

GRa (sq m)(as at 31 December 2013)

83,075 68,010 69,967 72,729 41,938 45,634 43,443 92,356 49,463 38,631

number of leases (as at 31 December 2013)

267 233 176 163 179 155 2 2 10 N.M. 5

land Use Right expiry 23 August 204423 August 2054

15 May 204315 May 2053

29 August 2044 10 March 2043 4 11 March 204120 March 2041

29 May 2044 7 October 20345 March 2042

3 June 2042

31 May 2042 10 July 2042 30 June 204415 September 2045

Market valuation 1

(as at 31 December 2013) (RMB million)2,600.0 1,900.0 1,881.8 472.0 362.0 251.0 949.0 590.0 543.0 504.0

Purchase Price (RMB million)

1,863.5 1,102.0 1,760.0 264.0 315.0 130.0 772.0 454.0 414.0 395.0

acquisition Date 2 Phase 1:5 February 2008

Phase 2:29 September 2008

1 December 2006 30 December 2013 8 November 2006 1 December 2006 8 November 2006 8 November 2006 1 December 2006 1 December 2006 30 June 2011

Committed occupancy Rate(as at 31 December 2013) (%)

98.3 99.0 95.9 97.1 99.9 90.9 100.0 100.0 100.0 N.M. 5

Shopper Traffic for 2013 3

(million)34.9 10.6 N.M. 5 11.5 8.4 7.9 – – – N.M. 5

Major Tenants Beijing Hualian Supermarket

Vero Moda/Only/Selected/

Jack & JonesUniqlo为之味

(夹拣成厨麻辣烫/金汤玉线/

”川成元”麻辣香锅/姑姑宴/

港仔驿栈)KFC

Beijing Hualian Group

(Department Store & Supermarket)

UNIQLOVero Moda/

Selected/Only/Jack & Jones

为之味(夹拣成厨麻辣烫/金汤玉线/

“川成元”麻辣香锅/姑姑宴)

I.TZARA

CarrefourPoly Cinema

H&MGAP

La ChapelleVero Moda/Only/

Selected/Jack & Jones

七宝大光明影城 (Cinema)Carrefour

Uniqlo Bao Da Xiang

Shopping For KidsH3 Club (Gym)

Haoledi (KTV)


BelleJinyi Cinema

NikeVero Moda/Only/


Breadtalk

Wal-MartTango KTV

阿香婆麻辣涮火锅Moli Restaurant

McDonald’sLa Chapelle

Beijing HualianDepartment Store

Beijing HualianSupermarket



CarrefourB&Q

AppleSASA

Subway

N.M. 5

Gross Revenue for 2013

(RMB million)241.4 183.1 N.M. 5 88.5 49.5 35.0 80.8 50.1 44.0 22.7

net Property Income for 2013(RMB million)

162.2 129.2 N.M. 5 36.1 25.7 14.5 66.1 39.5 35.1 3.4

1 Independent valuations of CapitaMall Qibao, CapitaMall Wuhu, CapitaMall Shuangjing, CapitaMall Anzhen and CapitaMall Saihan were conducted by CBRE Pte. Ltd.

Independent valuations of CapitaMall Erqi, CapitaMall Minzhongleyuan, CapitaMall Wangjing and CapitaMall Xizhimen were conducted by Colliers International (Hong Kong) Ltd.

CapitaMall Grand Canyon’s valuation was based on management’s valuation as the acquisition of the mall was completed on 30 December 2013. The mall was purchased from Capital Airport Real Estate Group Ltd for a purchase consideration of RMB1,760 million. An independent valuation by CBRE Pte Ltd. valued the mall at RMB1,830 million as at 15 April 2013, and its validity was subsequently extended to 31 August 2013. The valuer has considered valuation techniques including capitalisation and discounted cash flows in arriving the valuation of CapitaMall Grand Canyon.

PortfolioSummary

N.M.: Not Meaningful.

PortfolioDetails

63

CapitaMall xizhimen凯德MALL•西直门



凯德MALL•大峡谷CapitaMall Qibao

凯德七宝购物广场CapitaMall Saihan

凯德MALL•赛罕CapitaMall Wuhu

凯德广场•芜湖CapitaMall anzhen

凯德MALL•安贞CapitaMall erqi

凯德广场•二七


凯德MALL•双井


新民众乐园

address No. 1 Xizhimenwai Avenue,

Xicheng District, Beijing

No. 33 Guangshun North

Street, Blk 213 & 215, Chaoyang District,

Beijing

No. 16 South Third Ring West Road, Fengtai District,

Beijing

No. 3655, Qi Xin Road,

Minhang District,Shanghai

No. 26 Ordos Street,

Saihan District,Huhhot, Inner

MongoliaAutonomous Region

No. 37 ZhongshanNorth Road,

Xinwu District, Wuhu, Anhui

Section 5 No. 4 of

Anzhen Xi Li, Chaoyang District,

Beijing

No. 3 Minzhu Road,

Erqi District, Zhengzhou,

Henan Province

No. 31 Guangqu Road,

Chaoyang District,Beijing

No. 704 Zhongshan Avenue,

Jianghan District, Hankou Wuhan, Hubei Province

GFa (sq m)(as at 31 December 2013)

83,075 83,768 96,821 83,986 41,938 59,624 43,443 92,356 49,463 41,717

GRa (sq m)(as at 31 December 2013)

83,075 68,010 69,967 72,729 41,938 45,634 43,443 92,356 49,463 38,631

number of leases (as at 31 December 2013)

267 233 176 163 179 155 2 2 10 N.M. 5

land Use Right expiry 23 August 204423 August 2054

15 May 204315 May 2053

29 August 2044 10 March 2043 4 11 March 204120 March 2041

29 May 2044 7 October 20345 March 2042

3 June 2042

31 May 2042 10 July 2042 30 June 204415 September 2045

Market valuation 1

(as at 31 December 2013) (RMB million)2,600.0 1,900.0 1,881.8 472.0 362.0 251.0 949.0 590.0 543.0 504.0

Purchase Price (RMB million)

1,863.5 1,102.0 1,760.0 264.0 315.0 130.0 772.0 454.0 414.0 395.0

acquisition Date 2 Phase 1:5 February 2008

Phase 2:29 September 2008

1 December 2006 30 December 2013 8 November 2006 1 December 2006 8 November 2006 8 November 2006 1 December 2006 1 December 2006 30 June 2011

Committed occupancy Rate(as at 31 December 2013) (%)

98.3 99.0 95.9 97.1 99.9 90.9 100.0 100.0 100.0 N.M. 5

Shopper Traffic for 2013 3

(million)34.9 10.6 N.M. 5 11.5 8.4 7.9 – – – N.M. 5

Major Tenants Beijing Hualian Supermarket

Vero Moda/Only/Selected/

Jack & JonesUniqlo为之味

(夹拣成厨麻辣烫/金汤玉线/

”川成元”麻辣香锅/姑姑宴/

港仔驿栈)KFC

Beijing Hualian Group

(Department Store & Supermarket)

UNIQLOVero Moda/

Selected/Only/Jack & Jones

为之味(夹拣成厨麻辣烫/金汤玉线/

“川成元”麻辣香锅/姑姑宴)

I.TZARA

CarrefourPoly Cinema

H&MGAP

La ChapelleVero Moda/Only/


七宝大光明影城 (Cinema)Carrefour

Uniqlo Bao Da Xiang

Shopping For KidsH3 Club (Gym)

Haoledi (KTV)


BelleJinyi Cinema

NikeVero Moda/Only/


Breadtalk

Wal-MartTango KTV

阿香婆麻辣涮火锅Moli Restaurant

McDonald’sLa Chapelle





CarrefourB&Q

AppleSASA

Subway

N.M. 5

Gross Revenue for 2013

(RMB million)241.4 183.1 N.M. 5 88.5 49.5 35.0 80.8 50.1 44.0 22.7

net Property Income for 2013(RMB million)

162.2 129.2 N.M. 5 36.1 25.7 14.5 66.1 39.5 35.1 3.4

2 Refers to the completion of the acquisition of the special purpose vehicles which own the properties.3 CapitaMall Shuangjing, CapitaMall Anzhen, and CapitaMall Erqi do not have traffic counters. 4 CapitaMall Qibao is indirectly held by CRCT under a master lease with Shanghai Jin Qiu (Group) Co., Ltd, the legal owner of Qibao Mall. The master lease

expires in January 2024, with the right to renew for a further term of 19 years and two months. Accordingly, the land use right is owned by the legal owner.5 CapitaMall Minzhongleyuan is undergoing asset enhancement works and CapitaMall Grand Canyon’s acquisition was completed on 30 December 2013.

Hence certain data are not meaningful.


• Strategically located at Xizhimen transportation hub, well-served by Beijing’s subway Line 2, Line 13 and Line 4, as well as the national rail and bus interchange

• Retail podium of an integrated mixed-use property

• Well-supported by large shopper catchment from daily commuters passing through the busy transportation hub and middle-class residents from the vicinity

• Attracts working professionals and students from the nearby Beijing Finance Street, Beijing’s financial district and the universities and technological zones of Zhongguancun district

properTy inFormATion

Description Seven-storey shopping mall.Gross Rentable area (GRa) (sq m) 83,075number of leases 267land Use Right expiry 23 August 2044

23 August 2054Market valuation (RMB million) 2,600.0Gross Revenue (RMB million) 241.4net Property Income (RMB million) 162.2 Committed occupancy (%) 98.3Shopper Traffic (million) 34.9Key Tenants Beijing Hualian Supermarket

Vero Moda/Only/Selected/ Jack & JonesUNIQLO为之味(夹拣成厨麻辣烫/金汤玉线/”川成元”麻辣香锅/姑姑宴/港仔驿栈)KFC

Data as at 31 December 2013.Gross revenue, NPI and shopper traffic are for the year ended 31 December 2013.

PortfolioDetails

Capitamall xizhimen

PortfolioDetails

65

leAse expiry proFile (%)


35.7

25.3

17.0

22.2

17.2

20152014 2016

11.9

2017

8.2 9.5

Beyond 2017

15.4

35.9

Fashion & Accessories 42.2Food & Beverages 27.2Beauty & Healthcare 12.1Shoes & Bags 3.8Supermarket 3.8Education 3.6Sundry & Services 1.7Information & Technology 1.6Houseware & Furnishings 1.4Jewellery / Watches /Pens 1.3Sporting Goods & Apparel 0.5Toys & Hobbies 0.4Gifts & Souveniers 0.4Office 0.0

Fashion & Accessories 28.8Food & Beverages 27.7Supermarket 20.0Beauty & Healthcare 12.0Education 4.7Shoes & Bags 2.0Houseware & Furnishings 1.3Sundry & Services 1.2Jewellery/Watches/Pens 0.6Information & Technology 0.6Sporting Goods & Apparel 0.4Office 0.3Toys & Hobbies 0.2Gifts & Souveniers 0.2



% of Total Gross Rentable Area % of Total Rental Income

GRA (%) Total Rental Income (%)


Capitamall wangjing

• Leading comprehensive shopping mall in the densely populated residential suburb of Wangjing

• Convenient access by key highways, well-served by numerous bus routes and in close proximity to the Wangjingxi subway station

• A popular one-stop shopping, dining and entertainment destination in Wangjing

• International tenants include Zara, UNIQLO and Calvin Klein


Description Five-storey retail podium with a seven-storey tower above the podium.

Gross Rentable area (GRa) (sq m) 68,010number of leases 233Car Park lots 410land Use Right expiry 15 May 2043

15 May 2053Market valuation (RMB million) 1,900.0Gross Revenue (RMB million) 183.1 net Property Income (RMB million) 129.2Committed occupancy (%) 99.0Shopper Traffic (million) 10.6Key Tenants Beijing Hualian Group

(Department Store & Supermarket)UNIQLOVero Moda/Selected/Only/ Jack & Jones为之味(夹拣成厨麻辣烫/金汤玉线/ “川成元”麻辣香锅/姑姑宴)I.TZARA


PortfolioDetails

PortfolioDetails

67



GRA (%)

Fashion & Accessories 34.7Food & Beverages 23.5Department Store 12.3Beauty & Healthcare 9.1Education 3.4Leisure & Entertainment 3.3Supermarket 3.2Shoes & Bags 2.4Sundry & Services 2.4Toys & Hobbies 1.8Information & Technology 1.2Jewellery / Watches /Pens 1.1Sporting Goods & Apparel 0.6Music & Videos 0.4Houseware & furnishings 0.3Gifts & Souveniers 0.2Books & Stationery 0.1

Department Store 34.5Food & Beverages 16.5Supermarket 16.0Fashion & Accessories 14.4Beauty & Healthcare 8.2Leisure & Entertainment 4.2Education 1.9Toys & Hobbies 1.2Shoes & Bags 0.9Sundry & Services 0.9Information & Technology 0.3Jewellery/Watches/Pens 0.3Music & Videos 0.2Sporting Goods & Apparel 0.2Houseware & Furnishings 0.2Gifts & Souveniers 0.1Books & Stationery 0.0



2015

7.0

18.1

2014

19.2

33.9

2016

10.3

21.4

2017

6.0 3.4

Beyond 2017

56.5

23.2

Total Rental Income (%)



Capitamall grand Canyon

• Strategically located in the upcoming Fengtai district of South Beijing with strong economic fundamentals

• One of the pioneer shopping malls in south of Beijing

• Facing the busy South Third Ring West road, the shopping mall is easily accessible from the Majiapu subway station, Beijing South Railway Station and numerous bus-stops

• Well-established among the local community with its comprehensive offerings, popular tenants include Carrefour, H&M, Sephora, Costa Coffee and Poly Cinema


Description A six-storey shopping mall withtwo basement car park levels.

Gross Rentable area (GRa) (sq m) 69,967number of leases 176Car Park lots 403land Use Right expiry 29 August 2044Market valuation (RMB million) 1,881.8 1

Gross Revenue (RMB million) –net Property Income (RMB million) –Committed occupancy (%) 95.9Shopper Traffic (million) –Key Tenants Carrefour

Poly CinemaH&MGAPLa chapelle Vero Moda/Only/Selected/Jack & Jones


1 CapitaMall Grand Canyon’s valuation was based on management’s valuation as the acquisition was completed on 30 December 2013.

PortfolioDetails

PortfolioDetails

69

Fashion & Accessories 28.4Food & Beverages 21.6Supermarket 10.3Kids 7.2Music & Videos 6.1Education 5.4Beauty & Healthcare 4.8Shoes & Bags 3.6Jewellery / Watches /Pens 3.2Lifestyle 3.1Electricals & Electronics 2.0Houseware & Furnishings 1.8Gifts & Souveniers 1.4Sundry & Services 0.9Toys & Hobbies 0.1Information & Technology 0.1Sporting Goods & Apparel 0.0

Supermarket 33.5Fashion & Accessories 19.5Food & Beverages 17.1Music & Videos 9.9Kids 6.8Education 5.0Beauty & Healthcare 2.9Shoes & Bags 1.6Jewellery / Watches /Pens 0.9Houseware & Furnishings 0.8Lifestyle 0.7Electricals & Electronics 0.5Gifts & Souveniers 0.5Sporting Goods & Apparel 0.3Sundry & Services 0.0Information & Technology 0.0Toys & Hobbies 0.0

2015

12.7

27.9

2014

11.0

21.2

2016

8.912.4

2017

1.6 2.3

Beyond 2017

61.8

36.2








• One of the largest shopping malls in the Shanghai Minhang district, near Hongqiao transport hub

• Located in a growing mid-to high-end residential locality to the west of the Shanghai central business district

• One-stop family shopping destination providing shopping, dining and entertainment for residents

• First and only permanent rooftop farm commenced operations in CapitaMall Qibao in October 2013

• Popular fashion retailer UNIQLO opened its first duplex store in the Minhang district in CapitaMall Qibao in November 2010


Description Four-storey retail mall.Gross Rentable area (GRa) (sq m) 72,729number of leases 163Car Park lots 535land Use Right expiry 10 March 2043Market valuation (RMB million) 472.0Gross Revenue (RMB million) 88.5 net Property Income (RMB million) 36.1Committed occupancy (%) 97.1Shopper Traffic (million) 11.5Key Tenants 七宝大光明影城 (Cinema)

CarrefourUNIQLO Bao Da Xiang Shopping For KidsH3 Club (Gym)Haoledi (KTV)


Capitamall qibao

PortfolioDetails

PortfolioDetails

71

2015

15.819.4

2014

10.2

25.4

2016

12.3 12.3

2017

9.7 10.3

Beyond 2017

49.2

32.6

Food & Beverages 36.8Fashion & Accessories 30.0Beauty & Healthcare 8.2Leisure & Entertainment 6.8Supermarket 6.2Sundry & Services 3.1Education 2.8Shoes & Bags 2.5Houseware & Furnishings 1.5Jewellery / Watches /Pens 0.9Toys & Hobbies 0.5Gifts & Souveniers 0.4Information & Technology 0.3

Supermarket 29.6Food & Beverages 26.0Fashion & Accessories 17.5Leisure & Entertainment 10.3Beauty & Healthcare 10.0Education 3.5Sundry & Services 1.0Shoes & Bags 0.8Houseware & Furnishings 0.6Toys & Hobbies 0.3Jewellery / Watches /Pens 0.2Information & Technology 0.1Gifts & Souveniers 0.1








• One of the most popular one-stop shopping destinations in Huhhot

• Near the heart of Huhhot’s main retail belt

• Well-served by public transportation

• The range of retail offerings has widened with the opening of Jinyi cinema and new food & beverage outlets after the completion of asset enhancement works, attracting even more shoppers to CapitaMall Saihan


Description Four-storey retail mall. Gross Rentable area (GRa) (sq m) 41,938number of leases 179Car Park lots 45land Use Right expiry 11 March 2041

20 March 2041Market valuation (RMB million) 362.0Gross Revenue (RMB million) 49.5net Property Income (RMB million) 25.7Committed occupancy (%) 99.9Shopper Traffic (million) 8.4Key Tenants Beijing Hualian Supermarket

BelleJinyi CinemaNikeVero Moda/Only/Selected/Jack & JonesBreadtalk


Capitamall saihan

PortfolioDetails

PortfolioDetails

73

2015

15.6

25.4

2014

28.8

44.3

2016

1.8 3.8

2017

0.0 1.9

Beyond 2017

53.7

24.6

Fashion & Accessories 36.5Food & Beverages 16.6Supermarket 13.5Shoes & Bags 12.1Sporting Goods & Apparel 6.7Beauty & Healthcare 4.9Leisure & Entertainment 4.5Toys & Hobbies 1.3Houseware & Furnishings 1.1Sundry & Services 1.1Information & Technology 0.8Jewellery / Watches /Pens 0.7Gifts & Souveniers 0.1Books & Stationery 0.1

Supermarket 36.1Fashion & Accessories 21.4Food & Beverages 14.1Leisure & Entertainment 10.7Shoes & Bags 5.9Sporting Goods & Apparel 4.8Beauty & Healthcare 2.5Toys & Hobbies 1.9Sundry & Services 1.0Houseware & Furnishings 0.8Information & Technology 0.5Jewellery / Watches /Pens 0.3Books & Stationery 0.0Gifts & Souveniers 0.0








• Located approximately 1 km north of the Wuhu central business district

• Near the popular Fenghuang Food Street and close to several commercial projects

• One of the first one-stop shopping, dining and entertainment destinations in the locality

• Positioned as a destination for middle-income families and fits well with the targeted population catchment demographic profile


Description Four-storey plus one-storey basement shopping mall.

Gross Rentable area (GRa) (sq m) 45,634number of leases 155Car Park lots 368land Use Right expiry 29 May 2044Market valuation (RMB million) 251.0Gross Revenue (RMB million) 35.0net Property Income (RMB million) 14.5Committed occupancy (%) 90.9Shopper Traffic (million) 7.9Key Tenants Wal-Mart

Tango KTV阿香婆麻辣涮火锅Moli Restaurant McDonald’sLa Chapelle


Capitamall wuhu

PortfolioDetails

PortfolioDetails

75

2015

5.012.7

2014

11.6

40.3

2016

8.2 10.5

2017

4.7 7.9

Beyond 2017

61.5

28.6

Fashion & Accessories 27.4Food & Beverages 21.7Supermarket 16.5Leisure & Entertainment 7.7Shoes & Bags 6.6Beauty & Healthcare 5.5Sundry & Services 3.5Toys & Hobbies 2.9Gifts & Souveniers 2.5Jewellery / Watches /Pens 1.9Information & Technology 1.8Education 1.0Houseware & Furnishings 0.8Books & Stationery 0.2

Supermarket 54.2Food & Beverages 12.4

Leisure & Entertainment 11.3Fashion & Accessories 8.6Beauty & Healthcare 5.9Shoes & Bags 2.1Toys & Hobbies 1.3Sundry & Services 1.2Gifts & Souveniers 1.0Information & Technology 0.7Education 0.5Jewellery / Watches /Pens 0.4Houseware & Furnishings 0.3Books & Stationery 0.1








Capitamall Anzhen


Description Six-storey retail mall.Gross Rentable area (GRa) (sq m) 43,443number of leases 2Car Park lots –land Use Right expiry 7 October 2034

5 March 20423 June 2042

Market valuation (RMB million) 949.0Gross Revenue (RMB million) 80.8net Property Income (RMB million) 66.1 Committed occupancy (%) 100.0Shopper Traffic (million) –Key Tenants Beijing Hualian Department Store

Beijing Hualian SupermarketData as at 31 December 2013.Gross revenue and NPI are for the year ended 31 December 2013.

PortfolioDetails

• Located in a densely populated area to the south of the Olympic Village

• Adjacent to the North Third Ring Road and a major bus terminal

• One of the most popular and well-established shopping destinations in the vicinity

• Master leased to BHG

PortfolioDetails

77

• Located in Zhengzhou Central Business District, at the heart of Erqi District, Zhengzhou’s premier shopping district

• Attracts recurring shoppers from residents and office workers in the vicinity as well as visitors to the province

• Master leased to BHG


Description Seven-storey retail mall. Gross Rentable area (GRa) (sq m) 92,356number of leases 2Car Park lots 198land Use Right expiry 31 May 2042Market valuation (RMB million) 590.0Gross Revenue (RMB million) 50.1 net Property Income (RMB million) 39.5Committed occupancy (%) 100.0Shopper Traffic (million) –Key Tenants Beijing Hualian Department Store

Beijing Hualian SupermarketData as at 31 December 2013.Gross revenue and NPI are for the year ended 31 December 2013.

Capitamall erqi


Capitamall shuangjing

• Located in the Chaoyang District, in close proximity to the Beijing central business district

• Well-served by bus routes and close to Dawanglu and Shuangjing subway stations

• Strong supermarket anchor, drawing significant shopper traffic from the nearby central business district and neighbouring residential areas


Description Four-storey retail mall.Gross Rentable area (GRa) (sq m) 49,463number of leases 10Car Park lots 334land Use Right expiry 10 July 2042Market valuation (RMB million) 543.0Gross Revenue (RMB million) 44.0net Property Income (RMB million) 35.1Committed occupancy (%) 100.0Shopper Traffic (million) –Key Tenants Carrefour

B&QAppleSASASubway

Data as at 31 December 2013.Gross revenue and NPI are for the year ended 31 December 2013.

PortfolioDetails

PortfolioDetails

79

2015

0.0 0.0

2014

0.0 0.0

2016

9.4

2017

3.2 2.4

Supermarket 55.8Houseware & Furnishings 31.3Sundry & Services 5.2Fashion & Accessories 2.3Information & Technology 1.9Food & Beverages 1.8Beauty & Healthcare 1.7

Supermarket 60.9Houseware & Furnishings 34.0Fashion & Accessories 3.2Sundry & Services 1.0Food & Beverages 0.5Information & Technology 0.2Beauty & Healthcare 0.2

Total Rental Income (%)

Beyond 2017

95.488.2

Lease expiry profiLe (%)

As at 31 December 2013

Trade secTor anaLysis (%)

As at 31 December 2013

1.4


GRA (%)


Capitamall minzhongleyuan

• Strategically located along Zhongshan Avenue, an established shopping and entertainment belt that enjoys strong retail activities and pedestrian flow

• Easily accessible via public bus routes and metro lines 1 and 2

• Well-known for local fashion tenants offering young and trendy brands not commonly available in department stores

• Natural focal point among youths and young adults

• CapitaMall Minzhongleyuan is closed for asset enhancement works from July 2013, and targeted to reopen in the second quarter of 2014


Description Seven-storey annexed building and seven-storey conserved building.

Gross Rentable area (GRa) (sq m) 38,631number of leases –Car Park lots 71 land Use Right expiry 30 June 2044

15 September 2045Market valuation (RMB million) 504.0Gross Revenue (RMB million) 22.7net Property Income (RMB million) 3.4Committed occupancy (%) –Shopper Traffic (million) –Key Tenants –Data as at 31 December 2013.Gross revenue and NPI are for the year ended 31 December 2013.

PortfolioDetails

Report of the Trustee 82Statement by the Manager 83Independent Auditors’ Report 84Statements of Financial Position 85Statements of Total Return 86Distribution Statements 87Statements of Movements in

Unitholders’ Funds 89Portfolio Statement 90Consolidated Statement of Cash Flows 92Notes to the Financial Statements 94

Financial Statements

CapitaRetail China Annual Report 2013 Clarity82

Report of the TrusteeYear ended 31 December 2013

HSBC Institutional Trust Services (Singapore) Limited (the “Trustee”) is under a duty to take into custody and hold the assets of CapitaRetail China Trust (the “Trust”) in trust for the Unitholders. In accordance with the Securities and Futures Act (Cap. 289), its subsidiary legislation and the Code on Collective Investment Schemes, the Trustee shall monitor the activities of CapitaRetail China Trust Management Limited (the “Manager”) for compliance with the limitations imposed on the investment and borrowing powers as set out in the Trust Deed in each annual accounting period and report thereon to Unitholders in an annual report.

To the best knowledge of the Trustee, the Manager has, in all material respects, managed the Trust during the year covered by these financial statements, set out on pages 85 to 144, in accordance with the limitations imposed on the investment and borrowing powers set out in the Trust Deed.

For and on behalf of the Trustee,HSBC Institutional Trust Services (Singapore) Limited

Antony Wade LewisDirector

Singapore

26 February 2014

FinancialStatements

Management Reports 8383

Statement by the ManagerYear ended 31 December 2013

In the opinion of the directors of CapitaRetail China Trust Management Limited (the “Manager”), the accompanying financial statements set out on pages 85 to 144 comprising the statements of financial position, statements of total return, distribution statements and statements of movements in Unitholders’ funds of the CapitaRetail China Trust (the “Trust”) and its subsidiaries (the “Group”) and of the Trust, the portfolio statement and statement of cash flows of the Group and a summary of significant accounting policies and other explanatory information, are drawn up so as to present fairly, in all material respects, the financial position of the Group and of the Trust and the portfolio of the Group as at 31 December 2013, the total return, distributable income and movements in Unitholders’ funds of the Group and of the Trust and cash flows of the Group for the year ended on that date in accordance with the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore Chartered Accountants and the provisions of the Trust Deed. At the date of this statement, there are reasonable grounds to believe that the Group will be able to meet its financial obligations as and when they materialise.

For and on behalf of the Manager,CapitaRetail China Trust Management Limited

Tan Tee HieongDirector

Singapore

26 February 2014


Independent Auditors’ Report Unitholders of CapitaRetail China Trust(Constituted in the Republic of Singapore pursuant to a trust deed dated 23 October 2006 (as amended))We have audited the accompanying financial statements of CapitaRetail China Trust (the “Trust”) and its subsidiaries (the “Group”), which comprise the statements of financial position of the Trust and the Group and the portfolio statement of the Group as at 31 December 2013, the statements of total return, distribution statements and statements of movements in Unitholders’ funds of the Trust and of the Group and the statement of cash flows of the Group for the year then ended, and a summary of significant accounting policies and other explanatory information, as set out on pages 85 to 144.

MAnAgeR’S ReSponSIBILITy FoR THe FInAnCIAL STATeMenTSThe Manager of the Trust is responsible for the preparation and fair presentation of these financial statements in accordance with the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore Chartered Accountants, and for such internal control as the Manager of the Trust determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

AudIToRS’ ReSponSIBILITyOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Manager of the Trust, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

opInIonIn our opinion, the consolidated financial statements of the Group and the statement of financial position, statement of total return, distribution statement and statement of movements in Unitholders’ funds of the Trust present fairly, in all material respects, the financial position of the Group and the Trust as at 31 December 2013 and the total return, distributable income, and movements in Unitholders’ funds of the Group and of the Trust and the cash flows of the Group for the year then ended in accordance with the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore Chartered Accountants.

KpMg LLpPublic Accountants andChartered Accountants

Singapore26 February 2014

FinancialStatements


Statements of Financial PositionAs at 31 December 2013

The accompanying notes form an integral part of these financial statements.

Group Trust2013 2012 2013 2012

Note $’000 $’000 $’000 $’000

AssetsInvestment properties 4 2,058,094 1,476,988 – –Plant and equipment 5 7,325 5,827 – –Interests in subsidiaries 6 – – 1,028,567 873,139Trade and other receivables 7 11,371 9,129 224 269Financial derivatives 11 2,044 16,371 2,044 16,371Cash and cash equivalents 8 105,457 140,476 249 65,613

2,184,291 1,648,791 1,031,084 955,392

Less:LiabilitiesTrade and other payables 9 57,719 34,253 9,060 5,465Security deposits 34,980 27,413 – –Interest-bearing borrowings 10 712,338 465,362 474,383 443,018Financial derivatives 11 5,208 2,368 5,208 2,368Deferred tax liabilities 12 159,620 114,258 – –Provision for taxation 561 3,426 20 –

970,426 647,080 488,671 450,851

Net assets 1,213,865 1,001,711 542,413 504,541

Represented by:Unitholders’ funds 13 1,186,951 978,742 542,413 504,541Non-controlling interests 26,914 22,969 – –

1,213,865 1,001,711 542,413 504,541

Units in issue (’000) 14 803,027 748,910 803,027 748,910

Net asset value per unit attributable to Unitholders ($) 1.48 1.31 0.68 0.67


Statements of Total ReturnYear ended 31 December 2013


Group Trust2013 2012 2013 2012

Note $’000 $’000 $’000 $’000

Gross rental income 149,083 141,464 – –Other income 10,992 11,074 – –Gross revenue 160,075 152,538 – –

Land rental (5,238) (5,355) – –Property related tax (8,938) (8,960) – –Business tax (9,009) (8,737) – –Property management fees & reimbursables (8,028) (6,256) – –Other property operating expenses 16 (25,824) (23,554) – –Total property operating expenses (57,037) (52,862) – –Net property income 103,038 99,676 – –

Manager’s management fees – Base fee 17 (4,283) (3,889) (4,283) (3,889)– Performance fee 17 (4,122) (3,987) (4,122) (3,987)Manager’s acquisition fee – – (3,562) –Trustee’s fees (302) (287) (302) (287)Valuation fees (278) (191) – –Other trust operating (expenses)/income 18 (833) (971) 110 (415)Dividend income – – 17,396 16,232Foreign exchange gain - realised 746 6,608 620 310Finance income 1,133 842 24,210 11,413Finance costs (11,329) (11,661) (9,784) (9,857)Net finance (costs)/income 19 (10,196) (10,819) 14,426 1,556

Total return before change in fair value of financial derivatives, investment properties and unrealised foreign exchange gain 83,770 86,140 20,283 9,520

Change in fair value of financial derivatives 1,423 – (20,148) 11,764Change in fair value of investment properties 4 99,159 102,978 – –Foreign exchange gain/(loss) - unrealised 101 1,743 13,922 (27,826)Total return for the year before taxation 184,453 190,861 14,057 (6,542)Taxation 20 (48,505) (50,758) (20) –Total return for the year after taxation 135,948 140,103 14,037 (6,542)Non–controlling interest (3,030) (3,103) – –Total return for the year

attributable to Unitholders 132,918 137,000 14,037 (6,542)

Earnings per unit (cents) 21

– Basic 17.52 19.52 1

– Diluted 17.52 19.52 1

1 The figures have been restated for the effect of the underwritten non-renounceable 6-for-100 preferential offering that was completed on 20 November 2013 with 45,413,704 Units issued.

FinancialStatements


Distribution StatementsYear ended 31 December 2013


Group Trust2013 2012 2013 2012

Note $’000 $’000 $’000 $’000

Amount available for distribution to Unitholders at beginning of the year 11,256 30,427 11,256 30,427

Total return for the year attributable to Unitholders 132,918 137,000 14,037 (6,542)

Distribution adjustments A (62,858) (70,188) 56,023 73,354

Income for the year available for distribution to Unitholders B 70,060 66,812 70,060 66,812

Amount available for distribution to Unitholders 81,316 97,239 81,316 97,239

Distributions to Unitholders during the year:– Distribution of 1.50 cents per unit

for the period from 2 November 2012 to 31 December 2012 (11,234) – (11,234) –

– Distribution of 4.69 cents per unit for the period from 1 January 2013 to 30 June 2013 (35,180) – (35,180) –

– Distribution of 4.42 cents per unit for the period from 30 June 2011 to 31 December 2011 – (30,446) – (30,446)

– Distribution of 4.82 cents per unit for the period from 1 January 2012 to 30 June 2012 – (33,280) – (33,280)

– Distribution of 3.22 cents per unit for the period from 1 July 2012 to 1 November 2012 – (22,257) – (22,257)

(46,414) (85,983) (46,414) (85,983)Amount available for distribution to

Unitholders at end of the year 34,902 11,256 34,902 11,256Number of Units entitled to distributions

(’000) 21 803,027 750,908 1

Distribution per Unit (cents) 21 9.02 9.521

1 The figures have been restated for the effect of the underwritten non-renounceable 6-for-100 preferential offering that was completed on 20 November 2013 with 45,413,704 Units issued. The distribution per Unit before accounting for the preferential offering was 9.54 cents.



note A – distribution adjustments

Group Trust2013 2012 2013 2012

Note $’000 $’000 $’000 $’000

Distribution adjustment items:

– Manager’s management fees (performance component paid/payable in Units) 4,122 3,987 4,122 3,987

– Change in fair value of financial derivatives (1,423) – 20,148 (11,764)

– Change in fair value of investment properties1 (96,944) (102,978) – –

– Deferred taxation1 32,306 29,749 – –

– Transfer to general reserve (3,164) (2,706) – –

– Unrealised foreign exchange (gain)/loss1 (19) (67) (13,922) 27,826

– Other adjustments 2,264 1,827 – –

– Net overseas income not distributed to the Trust – – 45,675 53,305

Net effect of distribution adjustments (62,858) (70,188) 56,023 73,354

note B – Income for the year available for distribution to unitholders

Comprises:– from operations 24,385 13,507 24,385 13,507– from Unitholders’ contribution 45,675 53,305 45,675 53,305Total Unitholders’ distribution 15 70,060 66,812 70,060 66,812

1 Excludes non-controlling interest’s share.

Distribution StatementsYear ended 31 December 2013

FinancialStatements


Statements of Movements in Unitholders’ FundsYear ended 31 December 2013


Group Trust2013 2012 2013 2012

$’000 $’000 $’000 $’000

Unitholders’ funds as at beginning of the year 978,742 913,839 504,541 508,760OperationsChange in Unitholders’ funds

resulting from operations 132,918 137,000 14,037 (6,542)Transfer to general reserve (3,164) (2,706) – –Net increase/(decrease) in net assets

resulting from operations 129,754 134,294 14,037 (6,542)

Movements in hedging reserveEffective portion of changes in fair value of

cash flow hedges 157 749 157 749

Movements in foreign currency translation reserve

Translation differences from financial statements of foreign operations 52,209 (35,536) – –

Exchange differences on monetary items forming part of net investment in foreign operations 20,819 (50,648) – –

Exchange differences on hedges of net investment in foreign operations (21,572) 11,764 – –

Net gain/(loss) recognised directly in Unitholders’ funds 51,613 (73,671) 157 749

Movement in general reserve 3,164 2,706 – –

Unitholders’ transactionsNew Units issued 59,038 86,070 59,038 86,070Creation of Units paid/payable to Manager– Units issued and to be issued as satisfaction

of the portion of Manager’s management fees payable in Units 4,122 3,987 4,122 3,987

Units issued in respect of the distribution reinvestment plan 8,732 – 8,732 –

Distributions to Unitholders (46,414) (85,983) (46,414) (85,983)Equity issue expenses (1,800) (2,500) (1,800) (2,500)Net increase in net assets resulting from

Unitholders’ transactions 23,678 1,574 23,678 1,574

Unitholders’ funds as at end of year 1,186,951 978,742 542,413 504,541



Portfolio StatementAs at 31 December 2013

gRoupDescription of leasehold property Location

Term of lease Lease expiry Valuation Valuation

Percentageof Unitholders’

funds(years) 2013 1 2012 2013 2012 2013 2012

RMB’000 RMB’000 $’000 $’000 % %

CapitaMall Xizhimen

No. 1 Xizhimenwai Avenue, Xicheng District, Beijing

40 – 50 August 2044/2054

2,600,000 2,449,000 532,246 475,008 44.8 48.5

CapitaMall Wangjing

No. 33 Guangshun North Street, Blk 213 & 215, Chaoyang District, Beijing

38 – 48 May 2043/2053

1,900,000 1,690,000 388,949 327,792 32.8 33.5


No. 16 Nansanhuan Xi Road, Fengtai District, Beijing

40 – 50 August 2044/2054

1,881,793 – 385,222 – 32.5 –

CapitaMall Anzhen Section 5 No. 4 of Anzhen Xi Li, Chaoyang District, Beijing

29 – 37 October 2034/

March andJune 2042

949,000 940,000 194,270 182,322 16.4 18.6

CapitaMall Erqi No. 3 Minzhu Road, Erqi District, Zhengzhou, Henan Province

38 May 2042 590,000 583,000 120,779 113,079 10.2 11.6


No. 31 Guangqu Road, Chaoyang District, Beijing

40 July 2042 543,000 533,000 111,158 103,381 9.4 10.6

CapitaMall Minzhongleyuan 2

No. 704 Zhongshan Avenue, Jianghan District, Hankou, Wuhan, Hubei Province

40 June 2044/September

2045

504,911 449,911 103,360 87,265 8.7 8.9

CapitaMall Qibao 3 No. 3655 Qi Xin Road, Minhang District, Shanghai

39 March2043

472,000 420,000 96,623 81,463 8.1 8.3

Balance carried forward

9,440,704 7,064,911 1,932,607 1,370,310 162.9 140.0

FinancialStatements


gRoupDescription of leasehold property Location

Term of lease Lease expiry Valuation Valuation

Percentageof Unitholders’

funds(years) 2013 1 2012 2013 2012 2013 2012

RMB’000 RMB’000 $’000 $’000 % %

Balance brought forward

9,440,704 7,064,911 1,932,607 1,370,310 162.9 140.0

CapitaMall Saihan No. 26 Ordos Street, Saihan District, Huhhot, Inner Mongolia Autonomous Region

35 March 2041 362,000 322,000 74,105 62,455 6.2 6.4

CapitaMall Wuhu No. 37 Zhongshan North Road, Jinghu District, Wuhu, Anhui Province

40 May 2044 251,000 228,000 51,382 44,223 4.3 4.5

Investment properties, at valuation 10,053,704 7,614,911 2,058,094 1,476,988 173.4 150.9Other assets and liabilities (net) (844,229) (475,277) (71.1) (48.6)

1,213,865 1,001,711 102.3 102.3Net assets attributable to

non-controlling interests (26,914) (22,969) (2.3) (2.3)Net assets attributable to

Unitholders 1,186,951 978,742 100.0 100.0

Notes:1 On 31 December 2013, independent valuations of CapitaMall Anzhen, CapitaMall Shuangjing, CapitaMall Qibao, CapitaMall Saihan and CapitaMall Wuhu

were undertaken by CBRE Pte. Ltd. while valuations for the other properties were undertaken by Colliers International (Hong Kong) Limited. Valuation for CapitaMall Grand Canyon as at 31 December 2013 was based on management valuation as the acquisition of the mall was completed on 30 December 2013. The Manager of the Trust believes that the independent valuers have appropriate professional qualification and recent experience in the location and category of the properties being valued. The valuations were based on the capitalisation, discounted cash flows and/or term and reversion approaches.

The valuations adopted amounted to RMB10,053 million (2012: RMB7,614 million). The net change in fair values of the properties has been taken to the Group’s statement of total return. These are commercial properties leased to external tenants to earn rental income.

2 The carrying amount of CapitaMall Minzhongleyuan includes the valuation of the retail mall and carrying amount of the three residential units.3 CapitaMall Qibao is held under a master lease by CapitaRetail Dragon Mall (Shanghai) Co., Ltd, a subsidiary of CapitaRetail China Investments (B) Alpha Pte.

Ltd. The master lease was entered with Shanghai Jin Qiu (Group) Co., Ltd (“Jin Qiu”), the legal owner of CapitaMall Qibao and expires in January 2024, with the right to renew for a further term of 19 years and two months from January 2024 at the option of the Group. Accordingly, the land use rights is held by Jin Qiu.




Group2013 2012

Note $’000 $’000

Operating activitiesTotal return for the year after taxation 135,948 140,103Adjustments for:Net finance costs 10,196 10,819Depreciation and amortisation 2,088 1,774Write–back of impairment losses on trade receivables, net (58) (167)Taxation 48,505 50,758Manager’s management fees paid/payable in Units A(i) 4,122 3,987Plant and equipment written off 176 53Change in fair value of investment properties (99,159) (102,978)Change in fair value of financial derivative (1,423) –Operating income before working capital changes 100,395 104,349

Changes in working capital:Trade and other receivables (766) (13,341)Trade and other payables (10,582) 204Cash generated from operating activities 89,047 91,212Income tax paid (20,422) (33,922)Net cash from operating activities 68,625 57,290

Investing activitiesInterest received 1,133 842Net cash outflow on purchase of investment property B (134,610) –Capital expenditure on investment properties A(ii)(iii) (7,906) (11,643)Proceeds from disposal of plant and equipment 5 23Purchase of plant and equipment (1,937) (3,021)Net cash used in investing activities (143,315) (13,799)

Financing activitiesProceeds from issuance of new Units 59,038 86,070Distribution to Unitholders (37,682) (85,983)Payment of equity issue expenses (915) (1,227)Payment of financing expenses (977) (332)Proceeds from draw down of interest–bearing borrowings 309,148 115,000Repayment of interest–bearing borrowings (279,752) (81,044)Settlement of derivative contracts (2,824) 8,642Interest paid (11,309) (10,949)Net cash from financing activities 34,727 30,177

(Decrease)/increase in cash and cash equivalents (39,963) 73,668Cash and cash equivalents at 1 January 140,476 70,115Effect of foreign exchange rate changes on cash balances 4,944 (3,307)Cash and cash equivalents at 31 December 8 105,457 140,476

Consolidated Statement of Cash FlowsYear ended 31 December 2013

FinancialStatements


notes:(A) Significant non–cash and other transactions

(i) $3.1 million (2012: $3.0 million) of the $4.1 million (2012: $4.0 million) of the performance component of the Manager’s management fee was paid during the year through the issue of 2,074,331 Units (2012: 2,276,951 Units). The remaining $1.0 million (2012: $1.0 million) will be paid through the issue of 786,472 new Units (2012: 594,927 new Units) subsequent to the year end.

(ii) The Group incurred $36.1 million to purchase investment property in 2008, of which $43,000 and $1.7 million were paid in 2013 and 2012 respectively.

(iii) The Group enhanced its investment properties during the year, of which $6.6 million (2012: $4.7 million) was paid. During the year, the Group paid $1.3 million (2012: $5.2 million) of the prior years unpaid balance.

(B) Significant non–cash and other transactions Net cash outflows on acquisition of subsidiaries are provided below:

Group2013 2012

$’000 $’000

Investment property 380,459 –Cash 8,293 –Other assets 2,861 –Other liabilities (248,710) –Net identifiable assets and liabilities acquired 142,903 –

Cash consideration paid (142,903) –Cash acquired 8,293 –Net cash outflow (134,610) –



These notes form an integral part of the financial statements.

The financial statements were authorised for issue by the Manager and the Trustee on 26 February 2014.

1 geneRAL CapitaRetail China Trust (the “Trust”) is a Singapore–domiciled unit trust constituted pursuant to the trust

deed dated 23 October 2006 as amended by the First Supplemental Deed dated 8 November 2006, Second Supplemental Deed dated 15 April 2010, Third Supplemental Deed dated 5 April 2012 and Fourth Supplemental Deed dated 14 February 2014. (collectively the “Trust Deed”) between CapitaRetail China Trust Management Limited (the “Manager”) and HSBC Institutional Trust Services (Singapore) Limited (the “Trustee”). The Trust Deed is governed by the laws of the Republic of Singapore. The Trustee is under a duty to take into custody and hold the assets of the Trust held by it or through its subsidiaries (collectively the “Group”) in trust for the holders (“Unitholders”) of Units in the Trust (the “Units”).

The Trust was formally admitted to the Official List of the Singapore Exchange Securities Trading Limited (the “SGX-ST”) on 8 December 2006 (the “Listing Date”) and was included under the Central Provident Fund (“CPF”) Investment Scheme on 8 December 2006.

The principal activities of the Trust are those relating to investment in a diversified portfolio of income–producing properties located primarily in the People’s Republic of China (“China”), Hong Kong and Macau and used primarily for retail purposes.

The principal activities of the subsidiaries are those of investment holding of properties located in China and used for retail purposes.

The Group has entered into several service agreements in relation to the management of the Trust and its property operations. The fee structures for these services are as follows:

(a) Trustee’s fees Pursuant to the Trust Deed, the Trustee’s fee shall not exceed 0.03% per annum of the value of all the assets

of the Group (“Deposited Property”), subject to a minimum of $15,000 per month, excluding out of pocket expenses and Goods and Service Tax.

(b) Manager’s management fees The Manager is entitled under the Trust Deed to the following management fees:

• abasefeeof0.25%perannumofthevalueofthedepositedproperty;

• aperformancefeeof4.0%perannumofthenetpropertyincomeintherelevantfinancialyear(calculatedbeforeaccountingfortheperformancefeeinthatfinancialyear);and

• an authorised investmentmanagement fee of 0.5% per annum of the value of authorisedinvestments which are not real estate. Where such authorised investment is an interest in a property fund (either a real estate investment trust or private property fund) wholly managed by a wholly-owned subsidiary of CapitaLand Limited, no authorised investment management fee shall be payable in relation to such authorised investment.

Notes to the Financial StatementsYear ended 31 December 2013

FinancialStatements


1 geneRAL (continued)(b) Manager’s management fees (continued) The Manager may elect to receive the management fees in cash or Units or a combination of cash and/or

Units (as it may in its sole discretion determine).

(c) property management fees Under the property management agreements in respect of each property, the property managers will

provide lease management services, property tax services and marketing co–ordination services in relation to that property. The property managers are entitled to the following fees:

• 2.0%perannumofthegrossrevenue;

• 2.0%perannumofthenetpropertyincome;and

• 0.5%perannumofthenetpropertyincomeinlieuofleasingcommissionsotherwisepayabletotheproperty managers and/or third party agents.

(d) Acquisition fee For any authorised investment acquired from time to time by the Trustee on behalf of the Trust, the

acquisition fee payable to the Manager shall be:

• upto1.5%ofthepurchasepriceinthecaseofanyauthorisedinvestment(asdefinedintheTrustDeed)acquiredbytheTrustforlessthan$200million;and

• 1.0%of thepurchaseprice in thecaseofanyauthorised investmentacquiredby theTrust for $200 million or more.

The acquisition fee payable in respect of any authorised investment acquired from time to time by the Trustee on behalf of the Trust from CapitaMalls China Income Fund, CapitaMalls China Income Fund II, CapitaMalls China Income Fund III, CapitaMalls China Development Fund III, or CapitaMalls Asia Limited shall be 1.0% of the purchase price paid by the Trust.

No acquisition fee was payable for the acquisition of the initial property portfolio of the Trust.

The acquisition fee is payable to the Manager in the form of cash and/or Units (as the Manager may elect) at the prevailing market price provided that in respect of any acquisition of real estate assets from interested parties, such a fee should, if required by the applicable laws, rules and/or regulations, be in the form of Units issued by the Trust at prevailing market price(s) and subject to such transfer restrictions as may be imposed.

Any payment to third party agents or brokers in connection with the acquisition of any authorised investments for the Trust shall be paid by the Manager to such persons out of the deposited property of the Trust or the assets of the relevant special purpose vehicle, and not out of the acquisition fee received or to be received by the Manager.

CapitaRetail China Annual Report 2013 96 Clarity


1 geneRAL (continued)(e) divestment fee The Manager is entitled to receive a divestment fee of 0.5% of the sale price of any authorised investment

disposed directly or indirectly by the Trust, prorated if applicable to the proportion of the Trust’s interest.

The divestment fee is payable to the Manager in the form of cash and/or Units (as the Manager may elect) at the prevailing market price provided that in respect of any divestment of real estate assets to interested parties, such a fee should, if required by the applicable laws, rules and/or regulations, be in the form of Units issued by the Trust at prevailing market price(s) and subject to such transfer restrictions as may be imposed.

Any payment to third party agents or brokers in connection with the divestment of any authorised investments for the Trust shall be paid by the Manager to such persons out of the deposited property of the Trust or the assets of the relevant special purpose vehicle, and not out of the divestment fee received or to be received by the Manager.

2 BASIS oF pRepARATIon(a) Statement of compliance The financial statements have been prepared in accordance with the Statement of Recommended

Accounting Practice (“RAP”) 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore Chartered Accountants, and the applicable requirements of the Code on Collective Investment Schemes (the “CIS Code”) issued by the Monetary Authority of Singapore (“MAS”) and the provisions of the Trust Deed. RAP 7 requires that accounting policies adopted should generally comply with the principles relating to recognition and measurement of the Singapore Financial Reporting Standards (“FRS”).

(b) Basis of measurement The financial statements have been prepared on the historical cost basis except for the following material

items on the statement of financial position:

• derivativefinancialinstrumentsaremeasuredatfairvalue

• investmentpropertiesaremeasuredatfairvalue.

(c) Functional and presentation currency Items included in the financial statements of each entity in the Group are measured using the currency that

best reflects the economic substance of the underlying events and circumstances relevant to that entity (the “functional currency”). The consolidated financial statements of the Group are presented in Singapore dollars, which is the functional currency of the Trust. All financial information presented in Singapore dollars has been rounded to the nearest thousand, unless otherwise stated.

(d) use of estimates and judgements The preparation of financial statements in conformity with RAP 7 requires the Manager to make judgements,

estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying amounts of assets and liabilities that are not readily apparent from other sources.

FinancialStatements

97Management Reports

2 BASIS oF pRepARATIon (continued)(d) use of estimates and judgements (continued) Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates

are recognised in the period in which the estimates are revised and any future periods affected.

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment within the next financial year are included in the following notes:

• Note4 – Valuationofinvestmentproperties

• Note26 – Valuationoffinancialinstruments.

(e) Changes in accounting policies(i) RAp 7 (2012) From 1 January 2013, the Group and the Trust adopted the revised RAP 7 issued by the Institute of

Singapore Chartered Accountants (ISCA) in June 2012.

The adoption of RAP 7 (2012) has resulted in additional disclosures in the financial statements of the Group and the Trust for the current and comparative years. These have been included in the Statement of Total Return and notes to the financial statements.

The adoption of RAP 7 (2012) affects only the disclosures made in the financial statements. There is no financial effect on the financial position, total return or distributable income of the Group and the Trust for the current and previous financial years. Accordingly, the adoption of RAP 7 (2012) has no impact on earnings and distributions per unit.

(ii) Fair value measurement FRS 113 Fair value measurement establishes a single framework for measuring fair value and making

disclosures about fair value measurements, when such measurements are required or permitted by other FRSs. In particular, it unifies the definition of fair value as the price at which an orderly transaction to sell an asset or to transfer a liability would take place between market participants at the measurement date. It also replaces and expands the disclosure requirements about fair value measurements in other FRSs, including FRS 107 Financial Instruments: Disclosures.

From 1 January 2013, in accordance with the transitional provisions of FRS 113, the Group has applied the new fair value measurement guidance prospectively, and has not provided any comparative information for new disclosures. Notwithstanding the above, the change had no significant impact on the measurements of the Group’s assets and liabilities. The additional disclosures necessary as a result of the introduction of this standard has been included in Note 26.



3 SIgnIFICAnT ACCounTIng poLICIeS The accounting policies set out below have been applied consistently to all periods presented in these financial

statements, and have been applied consistently by Group entities.

(a) Basis of consolidation(i) Subsidiaries Subsidiaries are companies controlled by the Trust. Control exists when the Trust has the power, directly

or indirectly, to govern the financial and operating policies of a company so as to obtain benefits from its activities. In assessing control, potential voting rights presently exercisable are taken into account. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

The Group’s acquisition of subsidiaries are primarily accounted for as acquisitions of assets as the subsidiaries are special purpose vehicles established for the sole purpose of holding assets.

(ii) Loss of control Upon the loss of control, the Trust derecognises the assets and liabilities of the subsidiary, any

non-controlling interests and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised in the statement of total return.

If the Group retains any interest in the previous subsidiary, then such interest is measured at fair value at the date that control is lost. Subsequently, it is accounted for as an equity-accounted investee or as an available-for-sale financial asset depending on the level of influence retained.

(iii) Transactions eliminated on consolidation Intra-group balances and transactions, and any unrealised income or expenses arising from intra-group

transactions, are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with equity accounted investees are eliminated against the investment to the extent of the Group’s interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

(iv) Accounting for subsidiaries by the Trust Investments in subsidiaries are stated in the Trust’s statement of financial position at cost less accumulated

impairment losses.

(b) Foreign currency(i) Foreign currency transactions Transactions in foreign currencies are translated at the foreign exchange rates ruling at the date of the

transaction. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated at the foreign exchange rates ruling at that date. Non-monetary assets and liabilities measured at cost in a foreign currency are translated using foreign exchange rates at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated at the foreign exchange rates ruling at the date on which the fair value was determined.

FinancialStatements


3 SIgnIFICAnT ACCounTIng poLICIeS (continued)(i) Foreign currency transactions (continued) Foreign currency differences arising on retranslation are recognised in the statement of total return,

except for differences arising on the retranslation of monetary items that in substance form part of the Group’s net investment in a foreign operation (see below) and financial derivatives designated as hedges of the net investment in a foreign operation (see Note 3(c)(iii)).

(ii) Foreign operations The assets and liabilities of foreign operations are translated to Singapore dollars at exchange rates at

the reporting date. The income and expenses of foreign operations are translated to Singapore dollars at exchange rates at the dates of the transactions. Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the exchange rate at the reporting date.

Foreign currency differences are recognised in the foreign currency translation reserve. When a foreign operation is disposed of, in part or in full, the relevant amount is transferred to the statement of total return.

(iii) net investment in a foreign operation Exchange differences arising from monetary items that in substance form part of the Trust’s net investment

in a foreign operation are recognised in the Trust’s statement of total return. Such exchange differences are reclassified to foreign currency translation reserve in the consolidated financial statements. When the hedged net investment is disposed of, the cumulative amount in the foreign currency translation reserve is transferred to the statement of total return as an adjustment to the gain or loss arising on disposal.

(c) Financial instruments(i) non-derivative financial assets The Group initially recognises loans and receivables and deposits on the date that they are originated.

All other financial assets are recognised initially on the trade date at which the Group becomes a party to the contractual provisions of the instrument.

The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows on the financial asset in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred. Any interest in transferred financial assets that is created or retained by the Group is recognised as a separate asset or liability.



3 SIgnIFICAnT ACCounTIng poLICIeS (continued)(c) Financial instruments (continued)

(i) non-derivative financial assets (continued) Financial assets and liabilities are offset and the net amount presented in the statement of financial

position when, and only when, the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

The Group has loans and receivables as its non-derivative financial assets.

Loans and receivables Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an

active market. Such assets are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, loans and receivables are measured at amortised cost using the effective interest method, less any impairment losses.

Loans and receivables comprise non-trade amounts due from subsidiaries, cash and cash equivalents, trade and other receivables and exclude prepayments.

Cash and cash equivalents comprise cash balances and bank deposits.

(ii) non-derivative financial liabilities Financial liabilities are recognised initially on the trade date at which the Group becomes a party to the

contractual provisions of the instrument.

The Group derecognises a financial liability when its contractual obligations are discharged or cancelled or expired.

Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

The Group has the following non-derivative financial liabilities: interest-bearing borrowings, security deposits and trade and other payables.

Such financial liabilities are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, these financial liabilities are measured at amortised cost using the effective interest method.

(iii) derivative financial instruments, including hedge accounting The Group holds derivative financial instruments to hedge its foreign currency and interest rate

risk exposures. Embedded derivatives are separated from the host contract and accounted for separately if the economic characteristics and risks of the host contract and the embedded derivative are not closely related, a separate instrument with the same terms as the embedded derivative would meet the definition of a derivative, and the combined instrument is not measured at fair value through the statement of total return.

FinancialStatements


3 SIgnIFICAnT ACCounTIng poLICIeS (continued)(c) Financial instruments (continued)

(iii) derivative financial instruments, including hedge accounting (continued) On initial designation of the hedge, the Group formally documents the relationship between the hedging

instrument(s) and hedged item(s), including the risk management objectives and strategy in undertaking the hedge transaction and the hedged risk, together with the methods that will be used to assess the effectiveness of the hedging relationship. The Group makes an assessment, both at the inception of the hedge relationship as well as on an ongoing basis, of whether the hedging instruments are expected to be “highly effective” in offsetting the changes in the fair value or cash flows of the respective hedged items attributable to the hedged risk, and whether the actual results of each hedge are within a range of 80%-125%. For a cash flow hedge of a forecast transaction, the transaction should be highly probable to occur and should present an exposure to variations in cash flows that could ultimately affect the statement of total return.

Derivativesarerecognisedinitiallyatfairvalue;attributabletransactioncostsarerecognisedinthestatement of total return when incurred. Subsequent to initial recognition, derivatives are measured at fair value, and changes therein are accounted for as described below.

Cash flow hedges When a derivative is designated as the hedging instrument in a hedge of the variability in cash flows

attributable to a particular risk associated with a recognised asset or liability or a highly probable forecast transaction that could affect total return, the effective portion of changes in the fair value of the derivative is recognised and presented in the hedging reserve in Unitholders’ fund. The amount recognised in the hedging reserve is removed and included in the statement of total return in the same period as the hedged cash flows affect the statement of total return under the same line item in the statement of total return as the hedged item. Any ineffective portion of changes in the fair value of the derivative is recognised immediately in the statement of total return.

If the hedging instrument no longer meets the criteria for hedge accounting, expires or is sold, terminated or exercised, or the designation is revoked, then hedge accounting is discontinued prospectively. The cumulative gain or loss previously recognised and presented in the hedging reserve in Unitholders’ fund remains there until the forecast transaction occurs. When the hedged item is a non–financial asset, the amount recognised in the hedging reserve is transferred to the carrying amount of the asset when it is recognised. If the forecast transaction is no longer expected to occur, then the balance in the hedging reserve is recognised immediately in the statement of total return. In other cases, the amount recognised in the hedging reserve is transferred to the statement of total return in the same period that the hedged item affects the statement of total return.

Hedge of net investment in foreign operation Foreign currency differences arising on the retranslation of a financial liability designated as a hedge

of a net investment in a foreign operation are recognised in the Trust’s statement of total return. On consolidation, such differences are recognised directly, as part of foreign currency translation reserve, to the extent that the hedge is effective. To the extent that the hedge is ineffective, such differences are recognised in the statement of total return. When the hedged net investment is disposed of, the cumulative amount in the foreign currency translation reserve attributable to that investment is transferred to the statement of total return as an adjustment to the gain or loss on disposal.



3 SIgnIFICAnT ACCounTIng poLICIeS (continued)(d) Investment properties Investment properties are properties held either to earn rental income or capital appreciation or both.

Investment properties are accounted for as non-current assets and are stated at initial cost on acquisition and at fair value thereafter. The cost of a purchased property comprises its purchase price and any directly attributable expenditure. Transaction costs are included in the initial measurement. Fair value is determined in accordance with the Trust Deed, which requires the investment properties to be valued by independent registered valuers at least once a year in accordance with the CIS Code issued by the MAS.

Any increase or decrease on revaluation is credited or charged to the statement of total return as a net change in fair value of the investment properties.

Subsequent expenditure relating to investment properties that have already been recognised is added to the carrying amount when it is probable that future economic benefits, in excess of the originally assessed standard of performance of the existing asset will flow to the Group.

All other subsequent expenditure is recognised as an expense in the period in which it is incurred.

When an investment property is disposed of, the resulting gain or loss recognised in the statement of total return is the difference between the net disposal proceeds and the carrying amount of the property.

Investment properties are not depreciated. The properties are subject to continued maintenance and regularly revalued on the basis set out above.

(e) plant and equipment(i) Recognition and measurement Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment

losses. Cost includes expenditure that is directly attributable to the acquisition of the asset.

When parts of an item of plant and equipment have different useful lives, they are accounted for as separate items (major components) of plant and equipment.

Gains or losses arising from the retirement or disposal of plant and equipment are determined as the difference between the estimated net disposal proceeds and the carrying amount of the asset and are recognised in the statement of total return on the date of retirement or disposal.

(ii) Subsequent costs The cost of replacing part of an item of plant and equipment is recognised in the carrying amount of the

item if it is probable that the future economic benefits embodied within the part will flow to the Group and its cost can be measured reliably. The cost of the day-to-day servicing of plant and equipment are recognised in the statement of total return as incurred.

FinancialStatements


3 SIgnIFICAnT ACCounTIng poLICIeS (continued)(e) plant and equipment (continued)

(iii) depreciation Depreciation is provided on a straight-line basis so as to write off items of plant and equipment, and

major components that are accounted for separately, over their estimated useful lives as follows:

Improvement to premises – 3 to 5 years Plant and machinery – 3 to 5 years Motor vehicles – 5 years Furniture, fittings and equipment – 2 to 5 years

Depreciation methods, useful lives and residual values are reviewed, and adjusted as appropriate, at each reporting date.

(f) Impairment(i) Financial assets (including receivables) A financial asset not carried at fair value through the statement of total return is assessed at each

reporting date to determine whether there is objective evidence that it is impaired. A financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had a negative effect on the estimated future cash flows of that asset that can be estimated reliably.

Objective evidence that financial assets are impaired can include default or delinquency by a debtor, restructuring of an amount due to the Group on terms that the Group would not consider otherwise, indications that a debtor will enter bankruptcy.

The Group considers evidence of impairment for receivables at both a specific asset and collective level. All individually significant receivables are assessed for specific impairment. All individually significant receivables found not to be specifically impaired are then collectively assessed for any impairment that has been incurred but not yet identified. Receivables that are not individually significant are collectively assessed for impairment by grouping together receivables with similar risk characteristics.

In assessing collective impairment, the Group uses historical trends of the probability of default, timing of recoveries and the amount of loss incurred, adjusted for management’s judgement as to whether current economic and credit conditions are such that the actual losses are likely to be greater or less than suggested by historical trends.

An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate. Losses are recognised in the statement of total return and reflected in an allowance account against receivables. Interest on the impaired asset continues to be recognised through the unwinding of the discount. When a subsequent event causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through the statement of total return.



3 SIgnIFICAnT ACCounTIng poLICIeS (continued)(f) Impairment (continued)

(ii) non-financial assets The carrying amounts of the Group’s non-financial assets, other than investment properties, are reviewed

at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated.

The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the “cash-generating unit”, or “CGU”).

An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognised in the statement of total return. Impairment losses recognised in respect of the CGU are allocated first to reduce the carrying amount of any goodwill allocated to the units, and then to reduce the carrying amounts of the other assets in the unit (group of units) on a pro rata basis.

An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

(g) unitholders’ funds Unitholders’ funds represent the residual interests in the Group’s net assets upon termination and are

classified as equity.

Expenses incurred in connection with the issuance of Units in the Trust are deducted directly against the Unitholders’ funds.

(h) employee benefits(i) defined contribution plans Obligations for contributions to defined contribution pension plans are recognised as an expense in

the statement of total return as incurred.

(ii) Short-term benefits Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as

the related service is provided.

A provision is recognised for the amount expected to be paid under short-term cash bonus if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

FinancialStatements


3 SIgnIFICAnT ACCounTIng poLICIeS (continued)(i) distribution policy The Trust’s distribution policy is to distribute at least 90.0% of its distributable income in each financial year

to Unitholders, other than from the sale of properties that are determined by IRAS to be trading gains.

(j) Revenue recognitionRental income

Rental income receivable under operating leases is recognised on a straight-line basis over the term of the lease, except where an alternative basis is more representative of the pattern of benefits to be derived from the leased assets. Lease incentives granted are recognised as an integral part of the total rental to be received. Contingent rentals, which include gross turnover rental, are recognised as income in the accounting period on an earned basis. No contingent rental is recognised if there are uncertainties due to the possible return of the amounts received.

dividend income Dividend income is recognised when the right to receive payment is established.

(k) Lease payments Payment made under operating leases are recognised in profit or loss on a straight-line basis over the term

of the lease. Lease incentives received are recognised as an integral part of the total lease expense, over the term of the lease.

Contingent lease payments are accounted for by revising the minimum lease payments over the remaining term of the lease when the lease adjustment is confirmed.

(l) expenses(i) property expenses Property expenses are recognised on an accrual basis.

(ii) Manager’s management fees, property management fees and Trustee’s fees These are recognised on an accrual basis based on the applicable formula stipulated in Note 1.

(m) Finance income and finance costs Finance income comprises interest income recognised in the statement of total return as it accrues, using

the effective interest method.

Finance costs which comprise interest expense on borrowings and expense incurred in connection with borrowings are recognised in the statement of total return, using the effective interest method over the period of the borrowings.



3 SIgnIFICAnT ACCounTIng poLICIeS (continued)(n) Taxation Taxation on the returns for the year comprises current and deferred tax. Income tax is recognised in the

statement of total return except to the extent that it relates to items directly related to Unitholders’ fund, in which case it is recognised in the Unitholders’ fund.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the reporting date and any adjustment to tax payable in respect of previous years.

Deferred tax is recognised using the balance sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for:

• temporarydifferencesontheinitialrecognitionofassetsorliabilitiesinatransactionthatisnotabusinesscombinationandthataffectsneitheraccountingnortaxableprofit;and

• temporarydifferencesrelatingtoinvestmentsinsubsidiariestotheextentthatitisprobablethattheywill not reverse in the foreseeable future.

Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when

they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the unused tax losses and credits can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefits will be realised.

Except for the tax exemption as described below, income earned by the Trust will be subject to Singapore income tax at the trustee level at the prevailing corporate tax rate.

The Trust is exempted from Singapore income tax under Section 13(12) of the Singapore Income Tax Act on the following income:

(i) dividends;and

(ii) interest on shareholders’ loans,

payable by its subsidiaries in Barbados and Singapore out of underlying rental income derived from the investment properties in China.

This exemption is granted subject to certain conditions, including the condition that the Trustee is a tax resident of Singapore.

The tax exemption also applies to dividends payable by these subsidiaries out of gains, if any, derived from the disposal of their shares in the subsidiaries in China.

FinancialStatements


3 SIgnIFICAnT ACCounTIng poLICIeS (continued)(o) earnings per unit The Group presents basic and diluted earnings per unit (EPU) data for its Units. Basic EPU is calculated

by dividing the total return attributable to Unitholders of the Group by the weighted average number of ordinary Units outstanding during the period. Diluted EPU is determined by adjusting the total return attributable to Unitholders and the weighted average number of Units outstanding for the effects of all dilutive potential Units.

(p) Segment reporting An operating segment is a component of the Group that engages in business activities from which it may

earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s other components. Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision-Makers (“CODMs”). The CODMs has been identified as the Chief Executive Officer (“CEO”) and Head of Finance.

Segment results that are reported to the Group CEO include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly financial derivative assets and liabilities, other receivables, cash and cash equivalents, trade and other payables, and interest-bearing borrowings.

Segment capital expenditure is the total cost incurred during the year to acquire plant and equipment and capital expenditure on investment properties.

(q) new standards, interpretations and revised recommended accounting practice not yet adopted The Group has not applied the following accounting standards (including their consequential amendments)

and interpretations that have been issued as of the reporting date but are not yet effective:

• FRS27Separate Financial Statements• FRS28Investments in Associates and Joint Ventures• FRS32Financial Instruments: Presentation• FRS36Impairment of Assets• FRS110Consolidated Financial Statements• FRS111Joint Arrangements• FRS112 Disclosures of Interests in Other Entities

The initial application of these new standards and amendments to standards is not expected to have a significant effect on the financial statements of the Group.



4 InveSTMenT pRopeRTIeS

Group 2013 2012

$’000 $’000

At beginning of year 1,476,988 1,440,620Acquisition of investment property 380,459 –Expenditure capitalised 17,973 897

1,875,420 1,441,517Changes in fair value 99,159 102,978Translation differences 83,515 (67,507)At the end of year 2,058,094 1,476,988

Investment properties are stated at fair value based on valuation performed by independent professional valuers having appropriate recognised professional qualifications and recent experience in the location and category of property being valued. In determining the fair value, the valuers have used valuation methods which involve certain estimates. The Manager is of the view that the valuation methods and estimates are reflective of the current market conditions.

The fair values are based on open market values, being the estimated amount for which a property could be exchanged on the date of the valuation between a willing buyer and a willing seller in an arm’s length transaction wherein the parties had each acted knowledgably and without compulsion.

The valuers have considered valuation techniques including the capitalisation, discounted cash flows and/or term and reversion approaches in arriving at the open market value as at the reporting date.

The capitalisation approach capitalises an income stream into a present value using revenue multipliers or single-year capitalisation rates. The discounted cash flow method involves the estimation and projection of an income stream over a period and discounting the income stream with an internal rate of return to arrive at the market value. The term and reversion approach capitalises net rental income on a fully leased basis with regards to the current passing rental income from existing tenancies and potential future reversionary income at the market level.

Investment properties comprise retail properties that are held mainly for use by tenants under operating leases. Most leases contain an initial non-cancellable period of within 1 to 3 years (2012: within 1 to 3 years).

Contingent rents, representing income based on certain sales achieved by tenants, recognised in the statement of total return during the year amounted to $7.6 million (2012: $6.2 million).

FinancialStatements


5 pLAnT And equIpMenT

Improvement to premises

Plant and machinery

Motorvehicles

Furniture,fittings andequipment Total

$’000 $’000 $’000 $’000 $’000

GroupCostAt 1 January 2012 5,150 382 164 4,751 10,447Additions 2,137 9 – 817 2,963Disposal/written off (65) (2) – (290) (357)Translation difference on

consolidation (240) (18) (7) (215) (480)At 31 December 2012 6,982 371 157 5,063 12,573Assets acquired 44 – 155 1,989 2,188Additions 1,344 – – 694 2,038Disposal/written off (652) (56) (118) (1,504) (2,330)Translation difference on

consolidation 376 20 7 254 657At 31 December 2013 8,094 335 201 6,496 15,126

Less: Accumulated depreciationAt 1 January 2012 2,014 172 143 3,275 5,604Charge for the year 1,084 49 9 576 1,718Disposal/written off (59) (1) – (221) (281)Translation difference on

consolidation (118) (9) (7) (161) (295)At 31 December 2012 2,921 211 145 3,469 6,746Assets acquired 12 – 111 677 800Charge for the year 1,405 48 1 578 2,032Disposal/written off (639) (51) (106) (1,353) (2,149)Translation difference on

consolidation 175 12 6 179 372At 31 December 2013 3,874 220 157 3,550 7,801

Carrying amountsAt 1 January 2012 3,136 210 21 1,476 4,843At 31 December 2012 4,061 160 12 1,594 5,827At 1 January 2013 4,061 160 12 1,594 5,827At 31 December 2013 4,220 115 44 2,946 7,325



6 InTeReSTS In SuBSIdIARIeS

Trust2013 2012

$’000 $’000

(a) Unquoted equity, at cost 385,035 384,801

(b) Loans to subsidiaries 315,480 306,544Non-trade amounts due from subsidiaries 328,052 181,794

643,532 488,338

1,028,567 873,139

(a) Details of the subsidiaries are as follows:

Name of subsidiaries Principal activities

Place of incorporation/ business

Effective equity held by the Group2013 2012

% %

(i) Direct subsidiaries

* CapitaRetail China Investment holding Barbados 100 100Investments (B) Pte. Ltd.

* CapitaRetail China Investment holding Barbados 100 100Investments (B) Alpha Pte. Ltd.

* CapitaRetail China Investment holding Barbados 100 100Investments (B) Beta Pte. Ltd.

* CapitaRetail China Investment holding Barbados 100 100Investments (B) Gamma Pte. Ltd.

** CapitaRetail China Investment holding

British Virgin 100 100Investments (BVI) Alpha Limited Islands

***Somerset (Wuhan) Investments

Pte Ltd Investment holding Singapore 100 100

***CapitaLand Retail Investments

(SY) Pte Ltd Investment holding Singapore 100 –#

FinancialStatements


6 InTeReSTS In SuBSIdIARIeS (continued)




% %

(ii) Indirect subsidiaries

Subsidiary of CapitaRetail China Investments (B) Pte. Ltd.

* CapitaRetail Beijing Property investment China 100 100 Wangjing Real Estate Co., Ltd.

Subsidiaries of CapitaRetail China Investments (B) Alpha Pte. Ltd.

* CapitaRetail Beijing AnzhenProperty investment China 100 100 Real Estate Co., Ltd.

* CapitaRetail Dragon MallProperty investment China 100 100 (Shanghai) Co., Ltd.

* CapitaRetail BeijingProperty investment China 100 100 Shuangjing Real Estate Co., Ltd.

* CapitaRetail HenanProperty investment China 100 100 Zhongzhou Real Estate Co., Ltd.

* Huaxin Saihan HuhhotProperty investment China 100 100 Real Estate Co., Ltd.

Subsidiary of CapitaRetail China Investments (B) Beta Pte. Ltd.

* CapitaRetail BeijingProperty investment China 100 100 Xizhimen Real Estate Co., Ltd.

Subsidiary of CapitaRetail China Investments (B) Gamma Pte. Ltd.

* CapitaMalls WuhuProperty investment China 51 51 Commercial Property Co., Ltd.



6 InTeReSTS In SuBSIdIARIeS (continued)




% %

(ii) Indirect subsidiaries (continued)

Subsidiary of Somerset (Wuhan) Investments Pte Ltd

* Wuhan New Minzhong Property investment China 100 100 Leyuan Co., Ltd.

Subsidiary of CapitaLand Retail Investments (SY) Pte Ltd

* Beijing Huakun Real Estate Property investment China 100 –# Management Co., Ltd.

* Audited by other member firms of KPMG International.** This subsidiary is not required to be audited by the laws of the country of incorporation.*** Audited by KPMG LLP Singapore.# Acquired during the year ended 31 December 2013.

(b) The loans to subsidiaries, amounting to $315.5 million (2012: $306.5 million) and the non-trade amounts due from subsidiaries amounting to $310.1 million (2012: $162.1 million) are unsecured and settlement is neither planned nor likely to occur in the foreseeable future. As these amounts are, in substance, a part of the Trust’s net investments in the subsidiaries, they are stated at cost, less accumulated impairment. The remaining $18.0 million (2012: $19.7 million) of the non-trade amounts due from subsidiaries are unsecured, interest-free and repayable on demand. The loans to subsidiaries bear interest fixed at 7.5% (2012: 7.5%).

7 TRAde And oTHeR ReCeIvABLeSGroup Trust

2013 2012 2013 2012$’000 $’000 $’000 $’000

Trade receivables 2,653 1,233 – –Impairment losses (351) (163) – –

2,302 1,070 – –Other receivables 2,840 2,927 219 264Deposits 1,104 1,071 – –Loans and receivables 6,246 5,068 219 264Prepayments 5,125 4,061 5 5

11,371 9,129 224 269

Concentration of credit risk relating to loans and receivables is limited due to the Group’s many varied tenants located in several cities in China and the credit policy of obtaining security deposits from tenants for leasing the Group’s investment properties. These tenants comprise retailers engaged in a wide variety of consumer trades.

FinancialStatements


7 TRAde And oTHeR ReCeIvABLeS (continued) The maximum exposure to credit risk for loans and receivables at the reporting date (by geographical area in

China) is:

Group 2013 2012

$’000 $’000

Inner Mongolia 32 86Beijing 4,483 3,261Shanghai 1,212 1,193Others 300 264

6,027 4,804

Impairment losses The ageing of loans and receivables at the reporting date is:

Gross Impairment 2013 2012 2013 2012

$’000 $’000 $’000 $’000

GroupNot past due 4,278 3,998 – –Past due 1 – 30 days 1,074 765 – 60Past due 31 – 60 days 410 157 3 2Past due 61 – 90 days 132 80 – –More than 90 days past due 703 231 348 101

6,597 5,231 351 163

Gross Impairment 2013 2012 2013 2012

$’000 $’000 $’000 $’000

TrustNot past due 219 264 – –

The movement in the allowance for impairment in respect of trade receivables during the year is as follows:

Note

Group2013 2012

$’000 $’000

At 1 January 163 433Write-back, net 16 (58) (167)Provision acquired 332 –Allowance utilised (94) (86)Translation difference 8 (17)At 31 December 351 163



7 TRAde And oTHeR ReCeIvABLeS (continued) The majority of the trade receivables are mainly from tenants that have good credit records with the Group.

The allowance account in respect of trade receivables is used to record impairment losses unless the Group is satisfiedthatnorecoveryoftheamountowingispossible;atthatpointtheamountsareconsideredirrecoverableand are written off against the financial asset directly. During the year ended 31 December 2013, the Group collected $0.1 million (2012: $0.2 million) of its impaired trade receivables.

The Group’s historical experience in the collection of loans and receivables falls within the recorded allowances. The Manager believes that no additional credit risk beyond the amounts provided for collection losses is inherent in the Group’s loans and receivables, based on historical payment behaviours and the security deposits held (if applicable).

8 CASH And CASH equIvALenTSGroup Trust

2013 2012 2013 2012$’000 $’000 $’000 $’000

Cash at banks and in hand 71,311 51,835 249 629Fixed deposits with financial institutions 34,146 88,641 – 64,984

105,457 140,476 249 65,613

9 TRAde And oTHeR pAyABLeS Group Trust

2013 2012 2013 2012$’000 $’000 $’000 $’000

Trade payable 802 535 63 26Accrued operating expenses 12,463 10,016 3,047 3,034Accrued development expenditure 9,893 1,561 – –Amounts due to related parties (trade) 5,214 1,604 4,677 1,023Amount due to subsidiary (trade) – – 17 –Other deposits and advances 23,502 18,079 – –Interest payable 1,745 1,382 1,256 1,382Other payables 4,100 1,076 – –

57,719 34,253 9,060 5,465

Included in amounts due to related parties are amounts due to the Manager, Property and Project Managers of $4.7 million (2012: $1.0 million), $0.5 million (2012: $0.5 million) and $14,000 (2012: $57,000) respectively.

FinancialStatements


10 InTeReST–BeARIng BoRRoWIngS

Note

Group Trust 2013 2012 2013 2012

$’000 $’000 $’000 $’000

Unsecured term loans (a) 456,465 410,847 435,503 388,503Secured loans (b) 216,993 – – –Money market facilities 40,000 55,000 40,000 55,000Less: Unamortised transactions costs (1,120) (485) (1,120) (485)

712,338 465,362 474,383 443,018

(a) Unsecured term loans comprise $100.0 million, $88.0 million, $50.5 million, three $50.0 million, $47.0 million fixed/floating rate trust term loans (collectively known as “Trust Term Loan Facilities”) and a Renminbi (“RMB”) term loan of $21.0 million (RMB102.4 million). These facilities have negative pledge covenants which require the Trust, amongst others:

(i) not to, without the prior written consent of the lender, create or have outstanding any security on or overtheGroup’sinterestinanyoftheinvestmentproperties;

(ii) in the event of a sale of any of the investment properties, to repay an amount equal to the proportion of the market value of the investment properties sold to the total market value of the investment properties asdeterminedbythelenderbasedonthelatestannualvaluationreportsoftheinvestmentproperties;and

(iii) not to provide any guarantee for any other entities except for secured borrowings for new investment properties acquired with existing mortgages.

The Trust Term Loan Facilities are repayable in full at maturity, although the Trust has the option to make early prepayments.

In respect of the unsecured RMB term loan, 20% of the original RMB term loan principal of RMB128.0 million is repayable on a semi–annual basis in equal instalments starting in 2012 and the remaining 80% is payable in full upon maturity of the RMB term loan on 30 June 2014.

(b) Secured loans comprise of a RMB term loan of $106.5 million (RMB520 million) and a RMB bridge loan of $110.5 million (RMB540 million). Interest rates for these loans bear interest referenced against the 3 to 5 years People’s Bank of China (“PBOC”) base lending rate and 1 year PBOC base lending rate respectively.

As security for the loans, the Trust has granted in favour of the lender the following:

(i) amortgageoverCapitaMallGrandCanyon;

(ii) anassignmentoftherentalrevenueofCapitaMallGrandCanyon;and

(iii) an assignment of the insurance policies relating to CapitaMall Grand Canyon.

In respect of the secured RMB term loan, RMB12.5 million is payable on a semi-annual basis from June 2014. The outstanding loan balance of RMB407.5 million will be repaid on final maturity on 19 December 2018. The bridge loan is payable within 1 year from the drawdown date.



10 InTeReST–BeARIng BoRRoWIngS (continued)Terms and debt repayment schedule

Terms and conditions of the outstanding interest–bearing borrowings are as follows:

Nominal interest rate per annum

Year of maturity

Face value

Carryingamount

% $’000 $’000

2013

GroupS$ unsecured floating rate money market facility 1.04 – 1.25 2014 40,000 40,000S$ unsecured floating/fixed rate loan 1.41 – 2.66 2014 100,000 99,908RMB unsecured floating rate term loan 6.77 2014 20,962 20,962RMB secured floating rate bridge loan 6.00 2014 110,544 110,544S$ unsecured floating rate loan 1.85 – 1.98 2015 88,000 87,952S$ unsecured fixed rate loan 2.35 – 2.45 2016 50,000 49,896S$ unsecured floating rate loan 1.36 – 1.40 2016 50,000 49,879S$ unsecured floating rate loan 1.51 – 1.55 2017 50,503 50,331S$ unsecured fixed rate loan 2.75 2018 50,000 49,779S$ unsecured floating rate loan 1.51 2018 47,000 46,638RMB secured floating rate term loan 6.40 2018 106,449 106,449

713,458 712,338

TrustS$ unsecured floating rate money market facility 1.04 – 1.25 2014 40,000 40,000S$ unsecured floating/fixed rate loan 1.41 – 2.66 2014 100,000 99,908S$ unsecured floating rate loan 1.85 – 1.98 2015 88,000 87,952S$ unsecured fixed rate loan 2.35 – 2.45 2016 50,000 49,896S$ unsecured floating rate loan 1.36 – 1.40 2016 50,000 49,879S$ unsecured floating rate loan 1.51 – 1.55 2017 50,503 50,331S$ unsecured fixed rate loan 2.75 2018 50,000 49,779S$ unsecured floating rate loan 1.51 2018 47,000 46,638

475,503 474,383

2012

GroupS$ unsecured floating rate money market facilities 1.02 – 1.49 2013 55,000 55,000S$ unsecured floating rate loans 1.48 – 1.62 2013 150,503 150,456RMB unsecured floating rate term loan 7.04 2014 22,344 22,344S$ unsecured fixed/floating rate loan 1.50 – 2.66 2014 100,000 99,808S$ unsecured floating rate loan 1.98 – 2.25 2015 88,000 87,908S$ unsecured fixed rate loan 2.35 – 2.45 2016 50,000 49,846

465,847 465,362

FinancialStatements


10 InTeReST–BeARIng BoRRoWIngS (continued)Terms and debt repayment schedule (continued)

Nominal interest rate per annum

Year of maturity

Face value

Carryingamount

% $’000 $’000

2012

TrustS$ unsecured floating rate money market facilities 1.02 – 1.49 2013 55,000 55,000S$ unsecured floating rate loans 1.48 – 1.62 2013 150,503 150,456S$ unsecured fixed/floating rate loan 1.50 – 2.66 2014 100,000 99,808S$ unsecured floating rate loan 1.98 – 2.25 2015 88,000 87,908S$ unsecured fixed rate loan 2.35 – 2.45 2016 50,000 49,846

443,503 443,018

The following are the contractual maturities of non–derivative financial liabilities, including estimated interest payments and excluding the impact of netting agreements:

Carrying amount

Contractualcash flow

Within 1 year

Within 1 to 5 years

After 5 years

$’000 $’000 $’000 $’000 $’000

2013

GroupS$ unsecured floating rate money

market facility 40,000 (40,073) (40,073) – –S$ unsecured floating/fixed rate loan 99,908 (101,564) (101,564) – –RMB unsecured floating rate term loan 20,962 (21,663) (21,663) – –RMB secured floating rate bridge loan 110,544 (117,158) (117,158) – –S$ unsecured floating rate loans 234,800 (251,106) (3,913) (247,193) –S$ unsecured fixed rate loans 99,675 (106,067) (2,550) (103,517) –RMB secured floating rate term loan 106,449 (136,760) (11,830) (124,930) –Trade and other payables (Note 9) 57,719 (57,719) (57,719) – –Security deposits 34,980 (34,980) (13,034) (20,121) (1,825)

805,037 (867,090) (369,504) (495,761) (1,825)

TrustS$ unsecured floating rate money

market facility 40,000 (40,073) (40,073) – –S$ unsecured floating/fixed rate loan 99,908 (101,564) (101,564) – –S$ unsecured floating rate loans 234,800 (251,106) (3,913) (247,193) –S$ unsecured fixed rate loans 99,675 (106,067) (2,550) (103,517) –Trade and other payables (Note 9) 9,060 (9,060) (9,060) – –

483,443 (507,870) (157,160) (350,710) –



10 InTeReST–BeARIng BoRRoWIngS (continued)Terms and debt repayment schedule (continued)

Carrying amount


Within 1 year

Within 1 to 5 years

After 5 years

$’000 $’000 $’000 $’000 $’000

2012

GroupS$ unsecured floating rate money

market facilities 55,000 (55,404) (55,404) – –RMB unsecured floating

rate term loan 22,344 (24,647) (4,070) (20,577) –S$ unsecured floating rate loans 238,364 (243,559) (153,477) (90,082) –S$ unsecured fixed/

floating rate loan 99,808 (103,329) (1,758) (101,571) –S$ unsecured fixed rate loan 49,846 (53,985) (1,179) (52,806) –Trade and other payables (Note 9) 34,253 (34,253) (34,253) – –Security deposits 27,413 (27,413) (12,637) (11,913) (2,863)

527,028 (542,590) (262,778) (276,949) (2,863)

TrustS$ unsecured floating rate

money market facilities 55,000 (55,404) (55,404) – –S$ unsecured floating rate loans 238,364 (243,559) (153,477) (90,082) –S$ unsecured fixed/

floating rate loan 99,808 (103,329) (1,758) (101,571) –S$ unsecured fixed rate loan 49,846 (53,985) (1,179) (52,806) –Trade and other payables (Note 9) 5,465 (5,465) (5,465) – –

448,483 (461,742) (217,283) (244,459) –

It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.

FinancialStatements


11 FInAnCIAL deRIvATIveS

Group and Trust 2013 2012

$’000 $’000

Financial derivative assets 2,044 16,371

Financial derivative liabilities (5,208) (2,368)

The following are the contractual maturities of financial derivative assets and liabilities, including estimated interest payments:

Carryingamount


12 monthsor less

Within1 to 5 years

$’000 $’000 $’000 $’000

Group and Trust

Financial derivative assets2013

Interest rate swaps 302 322 (570) 892Non-deliverable forward 1,742 1,742 1,742 –

2,044 2,064 1,172 892

2012

Non-deliverable forward 16,371 16,371 7,110 9,261

Financial derivative liabilities2013

Interest rate swaps (1,090) (1,261) (1,388) 127Non-deliverable forward (4,118) (4,118) (1,286) (2,832)

(5,208) (5,379) (2,674) (2,705)

2012

Interest rate swaps (2,368) (4,882) (2,186) (2,696)

It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.

The table also indicates the periods in which the cash flows associated with derivatives that are expected to occur and impact the statement of total return and Unitholders’ funds.



12 deFeRRed TAx LIABILITIeS Movements in deferred tax liabilities during the financial year are as follows:

At1 January

Statement oftotal return

(Note 20)

Acquired on acquisition of

investment property

Translationdifference

At31 December

$’000 $’000 $’000 $’000 $’000

Group2013Investment properties 114,258 28,116 4,123 8,379 154,876Tax on unrepatriated profit – 4,744 – – 4,744

114,258 32,860 4,123 8,379 159,620

Group2012Investment properties 90,282 29,749 – (5,773) 114,258

Deferred tax assets have not been recognised in respect of the following items because it is not probable that future taxable profit will be available against which the Group can utilise the benefits therefrom:

Group 2013 2012

$’000 $’000

Tax losses 51,106 10,482

The tax losses are subject to agreement by the tax authorities and compliance with tax regulations in the country in which the subsidiaries operate. These tax losses can be carried forward up to five consecutive years and will expire on the fifth year from which the tax losses arise.

FinancialStatements


13 unITHoLdeRS’ FundS

Group Trust 2013 2012 2013 2012

Note $’000 $’000 $’000 $’000

Net assets resulting from operations 627,908 498,154 4,522 (9,515)Hedging reserve (a) (792) (949) (792) (949)Foreign currency translation reserve (b) 9,981 (41,475) – –Unitholders’ transactions 538,683 515,005 538,683 515,005General reserve (c) 11,171 8,007 – –

1,186,951 978,742 542,413 504,541

(a) The hedging reserve comprises the effective portion of the cumulative net change in the fair value of cash flow hedging instruments relating to forecast hedged transactions.

(b) The foreign currency translation reserve comprises:

(i) foreign exchange differences arising from the translation of the financial statements of foreign operations whosefunctionalcurrenciesaredifferentfromthefunctionalcurrencyoftheTrust;

(ii) the gains or losses on financial instruments used to hedge the Group’s net investment in foreign operationsthataredeterminedtobeeffectivehedges;and

(iii) the foreign exchange differences on monetary items which form part of the Group’s net investment in foreign operations, provided certain conditions are met.

(c) General reserve

The subsidiaries incorporated in China are required to transfer 10% of their profits after taxation, as determined under the accounting principles and relevant financial regulations of China, to the general reserve until the reserve balance reaches 50% of registered capital. The transfer to this reserve must be made before the distribution of dividends to shareholders.

General reserve can be used to make good previous years’ losses, if any, and may be converted to registered capital in proportion to the existing interests of the shareholders, provided that the balance after such conversion is not less than 25% of the registered capital.



14 unITS In ISSue

2013 2012Number of Units Number of Units

Balance as at beginning of year 748,909,649 688,829,911

New Units issued:– as payment of Manager’s management fees 2,669,258 3,079,738– in connection with preferential offering exercise completed on

20 November 2013 45,413,704 –– in connection with private placement exercise completed on

2 November 2012 – 57,000,000– as payment of distribution under distribution reinvestment plan 6,033,977 –Total issued Units as at end of year 803,026,588 748,909,649

New Units to be issued:– as payment of Manager’s management fees 786,472 594,927Total issued and issuable Units as at end of year 803,813,060 749,504,576

Units issued during the year ended 31 December 2013 are as follows:

(a) On 28 March 2013, the Trust issued 594,927 new Units at an issue price of $1.6251 per Unit as payment of the performancecomponentofthemanagementfeefortheperiodfrom1October2012to31December2012;

(b) On 6 June 2013, the Trust issued 601,471 new Units at an issue price of $1.7203 per Unit as payment of the performancecomponentofthemanagementfeefortheperiodfrom1January2013to31March2013;

(c) On 25 September 2013, the Trust issued 6,033,977 new Units at an issue price of $1.447 as payment of distributionunderdistributionreinvestmentplanfortheperiodfrom1January2013to30June2013;

(d) On 30 September 2013, the Trust issued 755,049 new Units at an issue price of $1.3993 per Unit as payment of the performance component of the management fee for the period from 1 April 2013 to 30June2013;

(e) On 20 November 2013, the Trust issued 45,413,704 new Units at an issue price of $1.30 per Unit in connection withthepreferentialofferingexercisetofinancetheacquisitionofCapitaMallGrandCanyon;and

(f) On 29 November 2013, the Trust issued 717,811 new Units at an issue price of $1.392 per Unit as payment of the performance component of the management fee for the period from 1 July 2013 to 30 September 2013.

Units issued during the year ended 31 December 2012 are as follows:

(a) On 30 March 2012, the Trust issued 802,787 new Units at an issue price of $1.136 per Unit as payment of the performancecomponentofthemanagementfeefortheperiodfrom1October2011to31December2011;

(b) On 5 June 2012, the Trust issued 824,734 new Units at an issue price of $1.2324 per Unit as payment of the performancecomponentofthemanagementfeefortheperiodfrom1January2012to31March2012;

FinancialStatements


14 unITS In ISSue (continued)(c) On 28 September 2012, the Trust issued 761,683 new Units at an issue price of $1.3089 per Unit as payment

oftheperformancecomponentofthemanagementfeefortheperiodfrom1April2012to30June2012;

(d) On 2 November 2012, the Trust issued 57,000,000 new Units at an issue price of $1.51 per Unit to finance the acquisitionofCapitaMallGrandCanyon;and

(e) On 27 November 2012, the Trust issued 690,534 new Units at an issue price of $1.4581 per Unit as payment of the performance component of the management fee for the period from 1 July 2012 to 30 September 2012.

The issue prices were determined based on the volume weighted average traded price for all trades done on the SGX–ST in the ordinary course of trading for the last 10 business days of the relevant periods in which the management fees accrue.

Each Unit in the Trust represents an undivided interest in the Trust. The rights and interests of Unitholders are contained in the Trust Deed and include the right to:

• onevoteperUnit;

• receiveincomeandotherdistributionsattributabletotheUnitsheld;

• participateintheterminationoftheTrustbyreceivingashareofallnetcashproceedsderivedfromtherealisation of the assets of the Trust less any liabilities, in accordance with their proportionate interests in the Trust. However, a Unitholder has no equitable or proprietary interest in the underlying assets of the Trust and is not entitled to the transfer to it of any assets (or part thereof) or any estate or interest in any asset (or part thereof)oftheTrust;and

• attendallUnitholders’meetings.TheTrusteeortheManagermay(andtheManagershallattherequestinwriting of not less than 50 Unitholders or one–tenth in number of Unitholders, whichever is lesser) at any time convene a meeting of Unitholders in accordance with the provisions of the Trust Deed.

The restrictions of a Unitholder include the following:

• a Unitholder’s right is limited to the right to require due administration of the Trust in accordance with the provisionsoftheTrustDeed;and

• a Unitholder has no right to request the Manager to redeem his Units while the Units are listed on the SGX-ST.

A Unitholder’s liability is limited to the amount paid or payable for any unit in the Trust. The provisions of the Trust Deed provide that no Unitholder will be personally liable to indemnify the Trustee or any creditor of the Trustee in the event that the liabilities of the Trust exceed its assets.



15 ToTAL unITHoLdeRS’ dISTRIBuTIon Unitholders’ distribution for the year is accounted for as distribution from operations and distribution from

Unitholders’ contributions:

(a) distribution from operations This refers to distribution made by the Trust that is represented by income received or receivable during the

financial year, as the case may be, net of expenses. Such income comprises mainly the following:

• dividend from subsidiaries in Barbados and Singapore paid out of dividend declared by the subsidiaries inChina;

• dividend from subsidiaries in Barbados and Singapore paid out of net interest income earned by subsidiariesinBarbadosandSingaporeonshareholders’loansextendedtosubsidiariesinChina;and

• interest income earned by the Trust on shareholders’ loans extended to subsidiaries in Barbados and Singapore.

The above income originates from profits and income derived by the subsidiaries in China in respect of the current financial year.

(b) distribution from unitholders’ contributions This refers to the amount of distribution made by the Trust for the financial year where the underlying cash

is not, or may not be, received or receivable as income by the Trust during that period. Such distribution comprises mainly the following:

• profits from operations arising from the investment properties which are declared as dividend income after the financial year, as the case may be, and accordingly also received as dividends by the Trust afterthatyear;

• profitsfromoperationsarisingfromtheinvestmentpropertieswhichcannotbedeclaredasdividends;

• adjustmentfordepreciationexpensesoftheinvestmentproperties;and

• adjustments for trust expenses that are paid in Units, foreign currency differences attributable to net investment hedges undertaken by the Trust and certain unrealised expenses.

Income available for distribution to unitholders at end of the year Distributions are made on a semi-annual basis, with the amount calculated as at 30 June and 31 December

each year for the six–month period ending on each of the said dates. In accordance with the provisions of the Trust Deed, the Manager is required to pay distributions within 90 days of the end of each distribution period. Distributions, when paid, will be in Singapore dollars.

Distributions for the period from 1 January 2013 to 30 June 2013 had been paid on 25 September 2013. Distributions for the period from 1 July 2013 to 31 December 2013 will be paid within 90 days of the end of the distribution period, in accordance with the provisions of the Trust Deed.

FinancialStatements


16 oTHeR pRopeRTy opeRATIng expenSeS

Group 2013 2012

Note $’000 $’000

Utilities 5,304 5,724Advertising and promotion 3,447 2,747Maintenance 6,088 6,120Staff costs 7,311 6,047Depreciation of plant and equipment 5 2,032 1,718Write–back on allowance for impairment of trade receivables, net 7 (58) (167)Amortisation of deferred expenditure included in other receivables 56 56Plant and equipment written off 176 53Others 1,468 1,256

25,824 23,554

Included in staff costs is contribution to defined contribution plans of $1.4 million (2012: $1.2 million).

17 MAnAgeR’S MAnAgeMenT FeeS Manager’s management fees comprise base fee of $4.3 million (2012: $3.9 million) and performance fee of

$4.1 million (2012: $4.0 million). The Manager has elected to receive all the performance fee in the form of Units. $3.1 million (2012: $3.0 million) of the $4.1 million (2012: $4.0 million) of performance component of the Manager’s management fee was paid during the year through the issue of 2,074,331 Units (2012: 2,276,951 Units). The remaining $1.0 million (2012: $1.0 million) will be paid through the issue of 786,472 new Units (2012: 594,927 new Units) subsequent to the year end.

18 oTHeR TRuST opeRATIng expenSeS/(InCoMe)

Group Trust2013 2012 2013 2012

$’000 $’000 $’000 $’000

Audit fees 407 383 155 157Professional fees 321 483 136 456Others 105 105 (401) (198)

833 971 (110) 415



19 FInAnCe InCoMe And FInAnCe CoSTS

Group Trust2013 2012 2013 2012

$’000 $’000 $’000 $’000

Interest income:– financial institutions 1,133 842 119 33– subsidiaries – – 24,091 11,380Finance income 1,133 842 24,210 11,413

Interest expenses (10,987) (11,338) (9,442) (9,534)Other finance costs (342) (323) (342) (323)Finance costs (11,329) (11,661) (9,784) (9,857)Net finance (costs)/income recognised in

statement of total return (10,196) (10,819) 14,426 1,556

20 TAxATIon

Group Trust 2013 2012 2013 2012

Note $’000 $’000 $’000 $’000

Current taxationCurrent year 16,607 21,303 15 –(Over)/under provision in prior years (962) (294) 5 –

15,645 21,009 20 –

Deferred taxationOrigination of temporary differences 12 32,860 29,749 – –

Income tax expense 48,505 50,758 20 –

Reconciliation of effective tax rate

Group Trust 2013 2012 2013 2012

$’000 $’000 $’000 $’000

Total return for the year before taxation 184,453 190,861 14,057 (6,542)

Tax calculated using Singapore tax rate of 17% 31,357 32,446 2,390 (1,112)Adjustments:Effect of different tax rates in foreign jurisdictions 8,310 11,982 – –Income not subject to tax (401) – (9,917) (6,694)Expenses not deductible for tax purposes – – 4,273 4,730Utilisation of previously unrecognised tax losses (3,196) (2,585) – –Tax losses not allowed to be carried forward 3,270 3,076 3,269 3,076Foreign tax suffered 10,127 6,133 – –(Over)/under provision in prior years (962) (294) 5 –

48,505 50,758 20 –

FinancialStatements


21 eARnIngS And dISTRIBuTIonS peR unITearnings per unit

The calculation of basic earnings per unit is based on weighted average number of Units during the year and total

return for the year after taxation and non–controlling interests before distribution.

Group 2013 2012

$’000 $’000

Total return for the year after taxation and non–controlling interests before distribution 132,918 137,000

TrustNumber of Units

Number of Units

2013 2012’000 ’000

Issued Units at beginning of year 748,910 688,830Effect of creation of new Units:– Manager’s management fees paid/payable in Units 6,362 1,338– Units issued in connection with preferential offering exercise

completed on 20 November 2013 3,332 –– Units issued in connection with private placement exercise

completed on 2 November 2012 – 9,188– As payment of distribution under distribution reinvestment plan 79 –– Adjustment for effect of preferential offering – 2,3211

Weighted average number of issued and issuable Units at end of year 758,683 701,6771

¹ The figures have been restated for the effect of the preferential offering on 20 November 2013.

Diluted earnings per unit is the same as the basic earnings per unit as there are no dilutive instruments in issue during the year.

distributions per unit

Group 2013 2012

$’000 $’000

Amount available for distribution to Unitholders at end of the year 70,060 66,812

TrustNumbers

of UnitsNumbers

of Units2013 2012

$’000 $’000

Number of Units entitled to distributions 803,027 748,910Adjustment for effect of preferential offering – 1,998 1

Adjusted number of Units entitled to distributions 803,027 750,908 1

1 The figures have been restated for the effect of the preferential offering on 20 November 2013.



22 ReLATed pARTy TRAnSACTIonS For the purposes of these financial statements, parties are considered to be related to the Group if the Group has the

ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group and the party are subject to common significant influence. Related parties may be individuals or other entities. The Manager, being CapitaRetail China Trust Management Limited is an indirect wholly-owned subsidiary of a substantial Unitholder of the Trust. The Property and Project Managers, being CapitaLand Retail (Shanghai) Management & Consulting Co., Ltd. and CapitaLand Retail (Beijing) Facilities & Projects Consulting Co., Ltd. are indirect wholly–owned subsidiaries of a substantial Unitholder of the Trust.

In the normal course of the operations of the Trust, the Manager’s management fees and the Trustee’s fees have been paid or are payable to the Manager and Trustee respectively. The property management fees, reimbursables and project management fees have been paid or are payable to the Property and Project Managers respectively.

23 FInAnCIAL RATIoS

Group 2013 2012

% %

Ratio of expenses to average net asset value 1

– including performance component of Manager’s management fees 0.89 1.00– excluding performance component of Manager’s management fees 0.52 0.57Portfolio turnover rate 2 – –

Notes:1 The annualised ratio is computed in accordance with the guidelines of the Investment Management Association of Singapore. The expenses used

in the computation relate to expenses at the Group level, excluding property related expenses and borrowing costs.2 The annualised ratio is computed based on the lesser of purchases or sales of underlying investment properties of the Group expressed as a

percentage of weighted average net asset value.

FinancialStatements


24 opeRATIng SegMenTS The Group has 10 reportable segments, as described below, which are the Group’s investment properties. The

investment properties are managed separately because they require different operating and marketing strategies. For each of the investment properties, the CODMs review internal management reports on a monthly basis.

All of the Group’s reportable segments are investment properties located in China used primarily for retail purposes. The reporting segments are as follows:

• CapitaMallXizhimen• CapitaMallWangjing• CapitaMallGrandCanyon• CapitaMallAnzhen• CapitaMallErqi• CapitaMallShuangjing• CapitaMallMinzhongleyuan• CapitaMallQibao• CapitaMallSaihan• CapitaMallWuhu

Segment revenue comprises mainly income generated from its tenants. Segment net property income represents the income earned by each segment after allocating property operating expenses. This is the measure reported to the CODMs for the purpose of assessment of segment performance. In addition, the CODMs monitor the non–financial assets as well as financial assets attributable to each segment when assessing segment performance.

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly the Trust’s financial assets and liabilities and its expenses. Segment capital expenditure is the total cost incurred during the year to acquire segment assets that are expected to be used for more than one year.

Information regarding the Group’s reportable segments is presented in the tables in the following pages.

For the purpose of monitoring segment performance, the Group’s CODMs monitor the non–financial assets as well as financial assets attributable to each segment.



24 opeRATIng SegMenTS (continued)Information about reportable segments

CapitaMall Xizhimen

CapitaMall Wangjing


CapitaMall Anzhen

CapitaMallErqi



CapitaMall Qibao

CapitaMall Saihan

CapitaMall Wuhu Grand Total

2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

External revenues: – Gross rental income 45,441 40,673 33,194 28,552 – – 16,261 15,881 10,059 9,824 8,535 8,348 4,286 9,452 15,623 15,050 9,123 7,571 6,561 6,113 149,083 141,464– Others 3,155 3,238 3,677 4,683 – – 1 – 25 – 331 106 292 599 2,190 1,402 839 536 482 510 10,992 11,074– Gross revenue 48,596 43,911 36,871 33,235 – – 16,262 15,881 10,084 9,824 8,866 8,454 4,578 10,051 17,813 16,452 9,962 8,107 7,043 6,623 160,075 152,538

Segment net property income 32,649 30,431 26,007 23,573 – – 13,319 13,004 7,963 7,518 7,073 6,670 675 5,272 7,270 6,477 5,171 3,829 2,911 2,902 103,038 99,676

Interest income 220 256 255 181 – – 173 117 58 25 77 54 19 23 103 68 73 55 32 30 1,010 809

Interest expense – – – – – – (1,545) (1,804) – – – – – – – – – – – – (1,545) (1,804)

Reportable segment total return before taxation 62,573 72,780 68,547 60,951 – – 13,613 17,567 9,271 9,285 8,896 8,551 903 5,833 16,764 17,365 13,090 8,910 7,704 7,496 201,361 208,738

Segment assets 548,622 495,122 423,837 349,520 396,192 – 207,476 192,021 129,896 116,838 117,053 108,685 107,106 88,654 110,344 92,940 81,952 69,725 58,647 50,955 2,181,125 1,564,460

Segment liabilities 66,678 52,243 66,071 48,603 235,185 – 46,303 44,507 14,011 11,720 14,327 12,277 12,105 5,936 16,812 13,311 4,673 3,964 5,143 3,591 481,308 196,152

Other segment items:

Depreciation and amortisation (784) (708) (562) (363) – – (45) (40) (80) (67) (11) (19) (99) (110) (109) (94) (228) (206) (170) (167) (2,088) (1,774)

Write-back/(impairment losses) on trade receivables, net 19 246 – – – – – – – – – (39) (8) (1) 10 (12) – – 37 (27) 58 167

Net change in fair value of investment properties 29,647 42,067 42,251 36,039 – – 1,716 2,747 1,370 1,460 1,953 1,589 273 638 9,451 10,874 7,977 5,108 4,521 2,456 99,159 102,978

Capital expenditure (1,741) (2,190) (719) (1,680) – – (98) (271) (71) (253) (73) (2) (10,985) (2,363) (1,107) (616) (209) 2,455 (244) 1,060 (15,247) (3,860)

FinancialStatements


24 opeRATIng SegMenTS (continued)Information about reportable segments

CapitaMall Xizhimen

CapitaMall Wangjing


CapitaMall Anzhen

CapitaMallErqi



CapitaMall Qibao

CapitaMall Saihan

CapitaMall Wuhu Grand Total

2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

External revenues: – Gross rental income 45,441 40,673 33,194 28,552 – – 16,261 15,881 10,059 9,824 8,535 8,348 4,286 9,452 15,623 15,050 9,123 7,571 6,561 6,113 149,083 141,464– Others 3,155 3,238 3,677 4,683 – – 1 – 25 – 331 106 292 599 2,190 1,402 839 536 482 510 10,992 11,074– Gross revenue 48,596 43,911 36,871 33,235 – – 16,262 15,881 10,084 9,824 8,866 8,454 4,578 10,051 17,813 16,452 9,962 8,107 7,043 6,623 160,075 152,538

Segment net property income 32,649 30,431 26,007 23,573 – – 13,319 13,004 7,963 7,518 7,073 6,670 675 5,272 7,270 6,477 5,171 3,829 2,911 2,902 103,038 99,676

Interest income 220 256 255 181 – – 173 117 58 25 77 54 19 23 103 68 73 55 32 30 1,010 809

Interest expense – – – – – – (1,545) (1,804) – – – – – – – – – – – – (1,545) (1,804)

Reportable segment total return before taxation 62,573 72,780 68,547 60,951 – – 13,613 17,567 9,271 9,285 8,896 8,551 903 5,833 16,764 17,365 13,090 8,910 7,704 7,496 201,361 208,738

Segment assets 548,622 495,122 423,837 349,520 396,192 – 207,476 192,021 129,896 116,838 117,053 108,685 107,106 88,654 110,344 92,940 81,952 69,725 58,647 50,955 2,181,125 1,564,460

Segment liabilities 66,678 52,243 66,071 48,603 235,185 – 46,303 44,507 14,011 11,720 14,327 12,277 12,105 5,936 16,812 13,311 4,673 3,964 5,143 3,591 481,308 196,152

Other segment items:

Depreciation and amortisation (784) (708) (562) (363) – – (45) (40) (80) (67) (11) (19) (99) (110) (109) (94) (228) (206) (170) (167) (2,088) (1,774)

Write-back/(impairment losses) on trade receivables, net 19 246 – – – – – – – – – (39) (8) (1) 10 (12) – – 37 (27) 58 167

Net change in fair value of investment properties 29,647 42,067 42,251 36,039 – – 1,716 2,747 1,370 1,460 1,953 1,589 273 638 9,451 10,874 7,977 5,108 4,521 2,456 99,159 102,978

Capital expenditure (1,741) (2,190) (719) (1,680) – – (98) (271) (71) (253) (73) (2) (10,985) (2,363) (1,107) (616) (209) 2,455 (244) 1,060 (15,247) (3,860)



24 opeRATIng SegMenTS (continued) Reconciliations of reportable segment revenues, total return, assets and liabilities and other material items

2013 2012$’000 $’000

Revenue Total revenue for reporting segments 160,075 152,538

Total returnTotal return for reportable segments before taxation 201,361 208,738

Unallocated amounts:– Other corporate expenses (16,908) (17,877)Total return before taxation 184,453 190,861

AssetsTotal assets for reportable segments 2,181,125 1,564,460Other unallocated amounts 3,166 84,331Consolidated assets 2,184,291 1,648,791

LiabilitiesTotal liabilities for reportable segments 481,308 196,152Other unallocated amounts 489,118 450,928Consolidated liabilities 970,426 647,080

Reportable segment totals

Unallocated amounts

Consolidated totals

$’000 $’000 $’000

Other material items 2013Interest income 1,010 123 1,133Interest expense (1,545) (9,784) (11,329)

Other material items 2012Interest income 809 33 842Interest expense (1,804) (9,857) (11,661)

geographical segments All of the Group’s investment properties are used for retail purposes and are primarily located in China.

Major tenant Revenue from one tenant of the Group represents approximately $35.5 million (2012: $34.9 million) of the Group’s

total revenue.

FinancialStatements


25 CoMMITMenTS(a) Capital commitments

Group2013 2012

$’000 $’000

Payable:– contracted but not provided for 4,023 1,568

(b) The Group leases out its investment properties. Operating lease rentals are receivable as follows:

Group2013 2012

$’000 $’000

Receivable:– within 1 year 158,326 122,025– after 1 year but within 5 years 364,307 304,406– after 5 years 412,612 396,070

935,245 822,501

(c) The Group has a non-cancellable lease with rentals payable as follows:

Group2013 2012

$’000 $’000

Payable:– within 1 year 5,819 4,294– after 1 year but within 5 years 23,992 22,410– after 5 years 32,854 36,815

62,665 63,519

26 CApITAL And FInAnCIAL RISK MAnAgeMenTCapital management

The Group’s objectives when managing capital are to optimise Unitholders’ value through the mix of available capital sources which include debt and equity instruments whilst complying with statutory and constitutional capital and distribution requirements, maintaining gearing and interest service coverage ratios within approved limits. As a key part of the Group’s overall strategy, the Board of the Manager reviews the Group and the Trust’s debt and capital management cum financing policy regularly so as to optimise the Group and the Trust’s funding structure. The Board also monitors the Group and the Trust’s exposure to various risk elements by closely adhering to clearly established management policies and procedures.



26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)Capital management (continued)

The Group is subject to the aggregate leverage limit as defined in Appendix 6 of the CIS Code (Property Fund Appendix). The Property Fund Appendix stipulates that the total borrowings and deferred payments (together, the “Aggregate Leverage”) of a property fund should not exceed 35.0% of its deposited property except that the Aggregate Leverage of a property fund may exceed 35.0% of its deposited property (up to a maximum of 60.0%) if a credit rating of the property fund from Fitch Inc., Moody’s or Standard and Poor’s is obtained and disclosed to the public. The Group’s aggregate leverage limit did not exceed 35.0% during the year, and was 32.6% (2012: 28.0%) as at 31 December 2013. In computing the aggregate leverage gearing ratio, the Trust has considered the effect of hedging the net assets denominated in RMB.

There were no changes in the Group’s approach to capital management during the financial year.

Financial risk managementoverview

The Group’s returns are primarily from net operating income and capital appreciation of its assets. However, these returns are exposed to financial risks including credit, liquidity, interest rate and foreign currency risks.

Financial risk management is integral to the whole business of the Group. The Group adopts an integrated approach to manage the financial risks arising in the normal course of the Group’s business. The Group has written risk management policies and guidelines, and established processes to monitor and manage significant exposures. Risk management policies and processes are reviewed regularly to reflect changes in market conditions and the Group’s activities.

The Group adheres to standardised accounting and financial policies and exercises effective controls over the financial affairs of its subsidiaries. This is achieved by ensuring group–wide adherence to a comprehensive set of guidelines covering contracts, policies and procedures and other requirements. Adequate measures are in place to ensure that the reliability and integrity of financial information compiled from subsidiaries are kept intact.

Credit risk While it is necessary to assume a certain level of tenant credit risks to remain competitive in China, the Group

has established credit limits for tenants and monitors their balances on an ongoing basis. Risks associated with credit limits are reflected in the level of security deposits and bank guarantees placed as collateral in respect of the leases. Appropriate risk mitigating actions are in place to manage trade receivables.

The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and other receivables. The main components of this allowance are a specific loss component that relates to individually significant exposures, and a collective loss component established for groups of similar assets in respect of losses that have been incurred but not yet identified. The collective loss allowance is determined based on historical data of payment statistics for similar financial assets.

The allowance account in respect of trade and other receivables is used to record impairment losses unless the Group is satisfied that no recovery of the amount owing is possible. At that point, the financial asset is considered irrecoverable and the amount charged to the allowance account is written off against the carrying amount of the impaired financial asset.

Cash and fixed deposits are placed with banks and financial institutions which are regulated.

FinancialStatements


26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)Financial risk management (continued)Liquidity risk

The Group monitors its liquidity risk and maintains a level of cash and cash equivalents deemed adequate by management to finance the Group’s operations and to mitigate the effects of fluctuations in cash flows. Typically the Group ensures that it has sufficient cash on demand to meet expected operational expenses for a reasonable period, including the servicing of financial obligations.

In addition, the Group maintains the following debt facilities and programme:

RMB denominated facilities:• theRMB102.4millionthree-yearunsecuredtermloanfacility

• theRMB540.0millionone-yearbridgeloanfacility

• theRMB520.0millionfive-yearsecuredtermloanfacility

S$ denominated facilities:• theS$151.0millionmoneymarketlinefacilities

• theS$100.0millionfour-yeartrusttermloanfacility

• theS$88.0millionthree-yeartrusttermloanfacility

• theS$50.0millionthree-yeartrusttermloanfacility



• theS$50.0millionfive-yeartrusttermloanfacility

• theS$150.0millionfive-yeartrusttermloanfacilities

US$ denominated facility:• theUS$50.0millionmoneymarketlinefacility

Multicurrency Medium Term Notes:• theS$500.0millionmulticurrencyMediumTermNote(“MTN”)programme

As at 31 December 2013, the Group has drawn down $435.5 million of its trust term loan facilities and $40.0 million of the money market facility. The Group has also drawn down the RMB102.4 million of the three-year unsecured term loan facility, RMB540.0 million of the one-year bridge loan facility, and RMB520.0 million of the five-year secured term loan facility.

The Group also monitors and observes the Property Fund Appendix issued by MAS concerning limits on total borrowings.



26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)Financial risk management (continued)Interest rate risk

The Manager adopts a proactive interest rate management policy to manage the risk associated with changes in interest rates on the Group’s loan facilities while also seeking to ensure that the ongoing cost of debt remains competitive.

At 31 December 2013, the Group has interest rate swaps (“IRS”) with notional contract amount of $315.5 million (2012: $250.5 million). The Group pays a fixed rate interest and receives a variable rate equal to the Swap Offer Rate (“SOR”) on the notional contract amount. The Group classifies the IRS as cash flow hedges to hedge the exposure to changes in the variability of interest rate fluctuations on certain of its term loans.

The term loans and the underlying IRS have the same terms and conditions.

The Manager proactively seeks to minimise the level of interest rate risk by locking the majority of the Group’s borrowings at fixed rates. As at 31 December 2013, the Group has locked in approximately 61.0% (2012: 68.8%) of its borrowings at fixed rates.

Fair value sensitivity analysis for fixed rate instruments The Group does not account for any fixed rate financial liabilities at fair value through profit or loss and the Group

does not designate interest rate derivatives as hedging instruments under a fair value hedge accounting model. Therefore a change in interest rates at the reporting date would not affect the statement of total return.

Cash flow sensitivity analysis for variable rate instruments The net change in fair value of the interest component of IRS as at 31 December 2013 of $0.2 million (2012:

$0.7 million), representing the effective portion of the cash flow hedge, has been recognised directly in the hedging reserves.

Effects of a 100 basis point* (“bp”) movement in interest rate at the reporting date as at 31 December 2013 would increase/(decrease) statement of total return and Unitholders’ funds by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remain constant. The analysis is performed on the same basis for 2012.

* 100 basis point is equivalent to 1 percentage point

Statement of total return Unitholders’ funds100 bp

increase$’million

100 bpdecrease$’million

100 bpincrease$’million

100 bpdecrease$’million

Group and Trust

2013Interest rate swaps – – 1.9 (1.9)Variable rate instruments (0.5) 0.5 – –Cash flow sensitivity (net) (0.5) 0.5 1.9 (1.9)

2012Interest rate swaps – – 2.4 (2.4)Variable rate instruments (1.5) 1.5 – –Cash flow sensitivity (net) (1.5) 1.5 2.4 (2.4)

FinancialStatements


26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)Financial risk management (continued)Foreign currency risk

The Group is exposed to foreign currency risk on cash holdings and operating expenses that are denominated in a currency other than the respective functional currencies of the Group entities. The currency giving rise to this risk is primarily the United States dollar (“US dollar”) and Chinese Renminbi (“RMB”).

As the Trust intends to be a long term investor in China, the Manager has taken a view not to hedge the RMB equity exposure arising from its investments in China unless certain risks are specifically identified. The Manager’s strategy is to achieve a natural hedge through local RMB financing and any non–RMB denominated loan will be hedged into RMB where possible, to protect the going concern of the Trust in the event of large currency fluctuation. However, the Manager will hedge the RMB cash flow from operations if it is determined with certainty that they are to be remitted back to Singapore for distribution purposes.

The Group’s and Trust’s exposures to foreign currency are as follows:

US Dollars RMB TotalS$’000 S$’000 S$’000

Group

2013Cash and cash equivalents 167 86 253

2012Cash and cash equivalents 241 15,308 15,549

Trust

2013Loans to subsidiaries 315,480 – 315,480Non-trade amounts due from subsidiaries 159,677 – 159,677Cash and cash equivalents 11 71 82

475,168 71 475,2392012Loans to subsidiaries 306,544 – 306,544Non-trade amounts due from subsidiaries 157,748 – 157,748Cash and cash equivalents 71 15,295 15,366

464,363 15,295 479,658

Sensitivity analysis A 10% strengthening of Singapore dollar against the US dollar and RMB at the reporting date would increase/

(decrease) total return after tax by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant. The analysis is performed on the same basis for 2012.



26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)Financial risk management (continued)Foreign currency risk (continued)Sensitivity analysis (continued)

Statements of total returnGroup Trust$’000 $’000

2013US dollars (17) (47,517)RMB (9) (7)

2012US dollars (24) (46,436)RMB (1,531) (1,530)

A 10% weakening of Singapore dollar against the US dollar and RMB would have had the equal but opposite effect on the US dollar and RMB to the amounts shown above, on the basis that all other variables remain constant.

Hedge of net investment in foreign operation The non–deliverable forwards (“NDF”) of $288.0 million (2012: $305.0 million) are designated as hedges of the

Group’s net investment in certain subsidiaries in China.

The net change in fair value of the net investment hedge comprised the effective portion of $21.6 million (2012: $11.8 million) which was recognised in the foreign currency translation reserve.

Sensitivity analysis For NDF (accounted for as net investment hedges), a change of 10% in foreign exchange rate at the reporting

date would increase/(decrease) Unitholders’ funds as at 31 December 2013 by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant. The analysis is performed on the same basis for 2012.

Unitholders’ funds10% 10%

increase decrease$’million $’million

Group

2013Non-deliverable forwards 21.9 (26.8)

2012Non-deliverable forwards 21.8 (26.6)

FinancialStatements


26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)Accounting classifications and fair valuesFair values versus carrying amounts

Loans and receivables

Fair value – hedging

instruments

Otherfinancialliabilities

within scopeof FRS 39

Total carryingamount Fair value

Note $’000 $’000 $’000 $’000 $’000

Group

2013Trade and other

receivables 7 6,246 – – 6,246 6,246Cash and cash equivalents 8 105,457 – – 105,457 105,457Financial derivative assets 11 – 2,044 – 2,044 2,044

111,703 2,044 – 113,747 113,747

Trade and other payables 9 – – 57,719 57,719 57,719Security deposits – – 34,980 34,980 33,803Interest-bearing

borrowings 10 – – 712,338 712,338 715,504Financial derivative

liabilities 11 – 5,208 – 5,208 5,208– 5,208 805,037 810,245 812,234

2012Trade and other

receivables 7 5,068 – – 5,068 5,068Cash and cash equivalents 8 140,476 – – 140,476 140,476Financial derivative assets 11 – 16,371 – 16,371 16,371

145,544 16,371 – 161,915 161,915

Trade and other payables 9 – – 34,253 34,253 34,253Security deposits – – 27,413 27,413 26,569Interest-bearing


liabilities 11 – 2,368 – 2,368 2,368– 2,368 527,028 529,396 529,170



26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)Accounting classifications and fair values (continued)Fair values versus carrying amounts (continued)

Loans and receivables

Fair value – hedging

instruments

Otherfinancialliabilities

within scopeof FRS 39

Total carryingamount Fair value

Note $’000 $’000 $’000 $’000 $’000

Trust

2013Non-trade amounts due

from subsidiaries 6 17,954 – – 17,954 17,954Trade and other

receivables 7 219 – – 219 219Cash and cash equivalents 8 249 – – 249 249Financial derivative assets 11 – 2,044 – 2,044 2,044

18,422 2,044 – 20,466 20,466

Trade and other payables 9 – – 9,060 9,060 9,060Interest-bearing


liabilities 11 – 5,208 – 5,208 5,208– 5,208 483,443 488,651 491,817

2012Non-trade amounts due

from subsidiaries 6 19,709 – – 19,709 19,709Trade and other

receivables 7 269 – – 269 269Cash and cash equivalents 8 65,613 – – 65,613 65,613Financial derivative assets 11 – 16,371 – 16,371 16,371

85,591 16,371 – 101,962 101,962

Trade and other payables 9 – – 5,465 5,465 5,465Interest-bearing


liabilities 11 – 2,368 – 2,368 2,368– 2,368 448,483 450,851 451,469

FinancialStatements


26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)Accounting classifications and fair values (continued)estimation of fair value

The following summarises the significant methods and assumptions used in estimating the fair values of financial instruments of the Group and Trust.

Investment Properties Refer to Note 4 on details on the valuation methods used to arrive at the fair value of investment properties.

Financial derivatives The fair value of non-deliverable forwards is based on banks’ quotes. These quotes are tested for reasonableness

by discounting the difference between the contractual forward price and the current forward price for the residual maturity of the contract using a risk-free interest rate (based on government bonds).

The fair value of interest rate swaps is based on banks’ quotes. These quotes are tested for reasonableness by discounting estimated future cash flows based on the terms and maturity of each contract and using market interest rates for a similar instrument at the measurement date.

Interest-bearing borrowings Fair value, which is determined for disclosure purposes, is calculated based on the present value of future principal

and interest cash flows, discounted at the market rate of interest at the reporting date.

Other financial assets and liabilities The carrying amounts of financial assets and liabilities with a maturity of less than one year (including trade

and other receivables, cash and cash equivalents, trade and other payables and current security deposits) are assumed to approximate their fair values because of the short period to maturity. All other financial assets and liabilities (non-current security deposits) are discounted to determine their fair values.

Interest rates used in determining fair values The interest rates used to discount estimated cash flows, where applicable, are based on the forward yield curve

as at 31 December 2013 plus an adequate constant credit spread, and are as follows:

2013 2012% p.a. % p.a.

Interest-bearing borrowings 1.04 – 6.77 1.02 – 7.04Security deposits 1.85 1.98



26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)Fair value hierarchy

The table below analyses financial and non-financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:

• Level1:quotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilities;

• Level2:inputsotherthanquotedpricesincludedwithinLevel1thatareobservablefortheassetorliability,eitherdirectly(i.e.,asprices)orindirectly(i.e.,derivedfromprices);and

• Level3:inputsfortheassetorliabilitythatarenotbasedonobservablemarketdata(unobservableinputs).

Level 1 Level 2 Level 3 Total $’000 $’000 $’000 $’000

Group and Trust

2013Financial instrumentsNon–deliverable forwards – (2,376) – (2,376)Interest rate swaps – (788) – (788)

– (3,164) – (3,164)

Non-financial instrumentsInvestment properties – – 2,058,094 2,058,094

– (3,164) 2,058,094 2,054,930

2012Financial instrumentsNon–deliverable forwards – 16,371 – 16,371Interest rate swaps – (2,368) – (2,368)

– 14,003 – 14,003

Financial assets and financial liabilities not carried at fair value but for which fair values are disclosed Non-current security deposits and fixed rates interest-bearing borrowings which are level 2 financial instruments

has fair value of $20.8 million and $102.0 million respectively.

FinancialStatements


26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)Fair value hierarchy (continued)Level 3 fair values

The reconciliation from the beginning balances to the ending balances for Level 3 fair value measurements of investment properties is disclosed in Note 4.

The following table shows the key unobservable inputs used in the valuation models:

Valuation Methods Key unobservable inputs

Inter-relationship between key unobservable inputs and fair value measurement

Capitalisation approach • Capitalisationrates (from 5.00% to 6.75%)

The fair value increases as capitalisation rates decreases.

Discounted cash flows approach

• Discountrates (from 8.75% to 11.00%)

• Terminalrates (from 5.50% to 6.75%)

The fair value increases as discount rates and terminal rates decreases.

Term and reversion approach

• Termandreversionrates (5.50% to 7.00%)

The fair value increases as term and reversion rates decreases.

Key unobservable inputs Key unobservable inputs correspond to:

• Investmentpropertyyieldsderivedfromspecialisedpublicationsfromtherelatedmarketsandcomparabletransactions.

• Discountrate,basedontherisk-freeratefor10-yearbondsissuedbythegovernmentintherelevantmarket.

offsetting financial assets and financial liabilities The disclosures set out in the tables below include financial assets and financial liabilities that:

• areoffsetintheTrust’sstatementsoffinancialposition;or

• aresubjecttoanenforceablemasternettingarrangement, irrespectiveofwhethertheyareoffset inthestatement of financial position



26 CApITAL And FInAnCIAL RISK MAnAgeMenT (continued)offsetting financial assets and financial liabilities (continued)

Financial instruments such as loans and receivables and financial liabilities are not disclosed in the tables below unless they are offset in the statements of financial position.

The Trust’s derivative transactions that are not transacted on an exchange are entered into under International Swaps and Derivatives Association (ISDA) Master Agreements. In certain circumstances, for example when a termination event such as a default occurs, all outstanding transactions under the agreement are terminated, the termination value is assessed and only a single net amount is due or payable in settlement of all transactions.

Under the agreements signed, the Trust and its counterparties neither have a legal obligation nor intend to settle on a net basis or to realise the assets and settle the liabilities simultaneously. In addition, the right of set-off of recognised amounts is enforceable only following the occurrence of a termination event as set out in the agreements. Accordingly, the ISDA agreements do not meet the criteria for offsetting and the derivatives financial instruments presented below are not offset in the Statement of Financial Position.

Financial assets and liabilities subject to offsetting and enforceable master netting arrangement under termination events:

Gross amounts of recognised

financial instruments

Gross amount of recognised

financial instruments offset in the

statement of financial

position

Net amounts of financial

instruments presented

in the statement of financial

position

Related amounts not offset in

the statement of financial

position Net amounts$’000 $’000 $’000 $’000 $’000

31 December 2013Financial assetsInterest rate swaps 302 – 302 (302) –Non-deliverable forward 1,742 – 1,742 (1,655) 87

2,044 – 2,044 (1,957) 87

Financial liabilitiesInterest rate swaps 1,090 – 1,090 (553) 537Non-deliverable forward 4,118 – 4,118 (1,404) 2,714

5,208 – 5,208 (1,957) 3,251

27 SuBSequenT evenT On 29 January 2014, the Manager declared a distribution of 4.33 cents per Unit to Unitholders in respect of the

period from 1 July 2013 to 31 December 2013.

On 10 February 2014, the Trust issued 2,735,125 new Units at an issue price of S$1.3023 per Unit as payment of the acquisition fee of CapitaMall Grand Canyon which was completed on 30 December 2013.

AppendixManagement Reports 145145

Interested Person Transactions

The transactions entered into with interested persons during the financial year, which fall under the Listing Manual and the CIS Code, are as follows:

Name of Interested Persons

Aggregate value of all Interestedperson transactions during the

financial period under review(excluding transactions of

less than S$100,000 each)S$’000

CapitaLand Limited and its subsidiaries or associates– Management fees 1 8,405– Property management fees & reimbursables 8,116– Acquisition fees related to acquisition of CapitaMall Grand Canyon 3,562 Trustee’s fees 297

1 For the purposes of Rule 907 of the Listing Manual of the SGX-ST, in arriving at this figure, the market price of the units (being the closing price of the units traded on the SGX-ST on the relevant date of issue of the units) issued to the Manager for its management fees, was used to determine the amount of the aggregate asset management fees paid to the Manager for the period from 1 January 2013 to 31 December 2013.

Saved as disclosed above, there were no additional Interested Person Transactions (excluding transactions of less than S$100,000 each) entered into during the financial period under review.

The fees and charges payable by CRCT to the Manager under the Trust Deed, and to the Property Managers under the Property Management Agreements (collectively, the “Exempted Agreements”), each of which constitutes a Interested Person Transaction, are deemed to have been specifically approved by the Unitholder upon purchase of the Units and are therefore not subject to Rules 905 and 906 of the Listing Manual to the extent that there is no subsequent change to the rates and/or bases of the fees charged thereunder which will affect CRCT. However, the renewal of such agreements will be subject to Rules 905 and 906 of the Listing Manual.

Please also see Related Party Transactions on note 22 in the financial statements.

SuBSCRIpTIon oF CRCT unITSAn aggregate of 2,669,258 Units were issued in relation to the performance component of the Manager’s management fee paid during the year. As at 31 December 2013, 803,813,060 Units were in issue and outstanding. In the first quarter of 2014, 786,472 Units will be issued to the Manager as part payment of the performance component of its management fee for the fourth quarter of 2013.


Unitholders’ StatisticsAs at 21 February 2014

ISSued And FuLLy pAId unITS805,761,713 Units (voting rights: 1 vote per Unit) Market Capitalisation: S$1,095,835,929.68 (based on closing Unit price of S$1.360 on 21 February 2014)

dISTRIBuTIon oF unITHoLdIngS Size of Holdings No. of Unitholders % No. of Units %

1 – 999 22 0.27 5,870 0.001,000 – 10,000 6,208 75.13 21,536,117 2.6710,001 – 1,000,000 2,011 24.33 84,045,788 10.431,000,001 and above 22 0.27 700,173,938 86.90

8,263 100.00 805,761,713 100.00 LoCATIon oF unITHoLdeRS Country No. of Unitholders % No. of Units %

Singapore 8,048 97.40 800,732,160 99.38Malaysia 116 1.40 2,911,797 0.36Others 99 1.20 2,117,756 0.26

8,263 100.00 805,761,713 100.00

TWenTy LARgeST unITHoLdeRSS/No. Name No. of Units %

1 HSBC (Singapore) Nominees Pte Ltd 195,144,243 24.222 Retail Crown Pte. Ltd. 147,332,694 18.283 DBS Nominees (Private) Limited 104,563,471 12.984 Citibank Nominees Singapore Pte Ltd 101,635,553 12.615 DBSN Services Pte. Ltd. 55,666,913 6.916 CapitaRetail China Trust Management Limited 26,689,100 3.317 DB Nominees (Singapore) Pte Ltd 12,822,775 1.598 Raffles Nominees (Pte) Limited 9,236,383 1.159 Morgan Stanley Asia (Singapore) Securities Pte Ltd 6,919,677 0.8610 DBS Vickers Securities (Singapore) Pte Ltd 5,511,052 0.6811 United Overseas Bank Nominees (Private) Limited 4,857,123 0.6012 Xu Yalan 4,670,000 0.5813 The Bank Of East Asia Nominees Pte Ltd 4,000,000 0.5014 Societe Generale, Singapore Branch 3,960,560 0.4915 Bank Of Singapore Nominees Pte. Ltd. 3,299,385 0.4116 OCBC Securities Private Limited 2,505,321 0.3117 Phillip Securities Pte Ltd 2,395,153 0.3018 BNP Paribas Securities Services Singapore Branch 2,267,371 0.2819 Seow Wen-Li Selena (Xiao Wenli Selena) 2,020,000 0.2520 OCBC Nominees Singapore Private Limited 1,720,284 0.21

697,217,058 86.52

AppendixManagement Reports 147147

dIReCToRS’ InTeReST In unITS And ConveRTIBLe SeCuRITIeS AS AT 21 JAnuARy 2014Based on the Register of Directors’ Unitholdings, save for those disclosed below, none of the Directors holds any interest in Units and convertible securities issued by CRCT.

No. of unitsName Direct Interest Deemed Interest

Liew Cheng San Victor 96,852 –Lim Ming Yan 172,780 –Ng Kok Siong 145,218 –Tony Tan Tee Hieong 32,829 – SuBSTAnTIAL unITHoLdeRS’ unITHoLdIngS AS AT 21 FeBRuARy 2014Based on the information available to the Manager as at 21 February 2014, the unitholdings of substantial unitholders of CRCT are as follows:

Name of Substantial Unitholder Direct Interest Deemed Interest

No. of Units % No. of Units %

Temasek Holdings (Private) Limited (“THPL”) – – 298,067,858(1) 36.99CapitaLand Limited (“CL”) – – 296,726,794(2) 36.83CapitaMalls Asia Limited (“CMA”) – – 296,726,794(3) 36.83CapitaLand Retail China Pte. Ltd. (“CLRC”) – – 147,332,694(4) 18.28Retail Crown Pte. Ltd. 147,332,694 18.28 – –HSBC Institutional Trust Services (Singapore) Limited, as trustee of CapitaMall Trust 122,705,000 15.23 – –Matthews International Capital Management, LLC (“MICM”) – – 60,253,000(5) 7.48Matthews International Funds (“MIF”) – – 48,680,000(6) 6.04AIA Group Limited (“AIAGL”) – – 44,302,000(7) 5.50AIA Company Limited (“AIACL”) 50,000 0.01 44,252,000(8) 5.49AIA Singapore Private Limited 44,252,000 5.49 – – (1) THPL is deemed to have an interest in the unitholdings in which its associated companies have or are deemed to have an interest pursuant to Section 4 of the

Securities and Futures Act, Chapter 289 of Singapore. THPL is wholly-owned by the Minister for Finance.(2) CL is deemed to have an interest in the unitholdings of HSBC Institutional Trust Services (Singapore) Limited, as trustee of CapitaMall Trust and its indirect

subsidiaries namely, Retail Crown Pte. Ltd. and the Manager.(3) CMA is deemed to have an interest in the unitholdings of HSBC Institutional Trust Services (Singapore) Limited, as trustee of CapitaMall Trust and its indirect

wholly-owned subsidiaries namely, Retail Crown Pte. Ltd. and the Manager. (4) CLRC is deemed to have an interest in the unitholdings of its direct wholly-owned subsidiary namely, Retail Crown Pte. Ltd..(5) MICM is a U.S. registered investment advisor who has a discretionary authority over its clients’ investment.(6) MIF is deemed to have an interest in the unitholdings of Brown Brothers Harriman & Co, the custodian for Units owned by MIF.(7) AIAGL is deemed to have an interest in the unitholdings of its direct wholly-owned subsidiary namely, AIACL and its indirect wholly-owned subsidiary, namely

AIA Singapore Private Limited.(8) AIACL is deemed to have an interest in the unitholdings of its direct wholly-owned subsidiary namely, AIA Singapore Private Limited.

FReeFLoATBased on information made available to the Manager as at 21 Feburary 2014, approximately 49.98% of the units in CRCT were held in the hands of the public. Rule 723 of the Listing Manual of the SGX-ST has accordingly been complied with.


Malls Directory

Malls Address Tel (General) Fax (General)

CapitaMall Xizhimen凯德MALL•西直门

Xihuan Plaza, No. 1 Xizhimenwai Street,Xicheng District, Beijing P.R.C.北京市西城区西直门外大街1号西环广场

(86) 10 5830 1008 (86) 10 5830 1599


No. 33 North Guangshun Street,Chaoyang District, Beijing P.R.C. 北京市朝阳区广顺北大街33号

(86) 10 8472 9898 (86) 10 8472 9800

CapitaMall Grand Canyon凯德MALL•大峡谷

No.16 South 3rd Ring West Road, Fengtai District, Beijing P.R.C.北京市丰台区南三环西路16号

(86) 10 8757 6436 (86) 10 8526 7556

CapitaMall Qibao凯德七宝购物广场

No. 3655 Qixin Road, Minhang District, Shanghai P.R.C. 上海市闵行区七莘路3655号

(86) 21 6479 3030 (86) 21 6479 0808

CapitaMall Saihan凯德MALL•赛罕

No. 26 E’Er Duo Si Street, Saihan District,Huhhot, Inner Mongolia P.R.C. 内蒙古呼和浩特市赛罕区鄂尔多斯大街26号尔多斯大街32号

(86) 47 1596 1222 (86) 47 1597 1671

CapitaMall Wuhu凯德广场•芜湖

No. 37 North Zhongshan Road, Wuhu, Anhui P.R.C. 安徽省芜湖市中山北路37号

(86) 55 3599 1888 (86) 55 3599 1886

CapitaMall Anzhen凯德MALL•安贞

Building 4, Zone 5, Anzhenxili,Chaoyang District, Beijing P.R.C.北京市朝阳区安贞西里5区4号楼

(86) 10 5879 9001 (86) 10 5879 9009

CapitaMall Erqi凯德广场•二七

No. 3 Minzhu Road, Zhengzhou,Henan P.R.C.河南省郑州市民主路3号

(86) 371 6659 7001 (86) 10 5879 9009

CapitaMall Shuangjing凯德MALL•双井

No. 31 Guangqu Road,Chaoyang District, Beijing P.R.C. 北京市朝阳区广渠路31号

(86) 10 5879 9001 (86) 10 5879 9009

CapitaMall Minzhongleyuan新民众乐园

No. 704 Zhongshan Avenue, Hankou, Wuhan, Hubei P.R.C.湖北省武汉市汉口中山大道704号

(86) 27 8553 0108 (86) 27 8537 9137

Corporate Information

CapitaRetail China tRust

RegisteRed addRess hsBC institutional trust services (singapore) limited 21 Collyer Quay #10-02 HSBC Building Singapore 049320

WeBsite addResswww.capitaretailchina.com Email: [email protected]

tRusteehsBC institutional trust services (singapore) limited 21 Collyer Quay #03-01 HSBC Building Singapore 049320 Phone: +65 6658 6906 Fax: +65 6534 5526

auditoR KpMg llp Public Accountants and Chartered Accountants 16 Raffles Quay #22-00 Hong Leong Building Singapore 048581 Phone: +65 6213 3388 Fax: +65 6225 0984 Partner-In-Charge: Mr Ronald TayAppointed: With effect from financial year ended 31 December 2012

unit RegistRaR Boardroom Corporate & advisory services pte. ltd. 50 Raffles Place #32-01 Singapore Land Tower Singapore 048623 Phone: +65 6536 5355 Fax: +65 6536 1360

CapitaRetail China tRust ManageMent liMited, the ManageR of CRCt

RegisteRed addRess CapitaRetail China trust Management limited 39 Robinson Road #18-01 Robinson Point Singapore 068911 Phone: +65 6536 1188 Fax: +65 6536 3884

diReCtoRs of the ManageR Mr liew Cheng san VictorChairman & Independent Non-Executive Director

Mr lim Ming YanDeputy Chairman & Non-Executive Director

Mr fong heng BooIndependent Non-Executive Director

Mr Christopher gee Kok aunIndependent Non-Executive Director

Mr ng Kok siongNon-Executive Director

Mr tony tan tee hieongChief Executive Officer & Executive Director

audit CoMMittee Mr fong heng Boo ChairmanMr Christopher gee Kok aunMr ng Kok siong

CoRpoRate disClosuRe CoMMitteeMr liew Cheng san Victor ChairmanMr lim Ming YanMr ng Kok siong

exeCutiVe CoMMitteeMr lim Ming Yan ChairmanMr ng Kok siong Mr tony tan tee hieong

CoMpanY seCRetaRiesMr Choo Wei-pinMs goh Mei lan

This Annual Report to Unitholders may contain forward-looking statements. Forward-looking statement is subject to inherent uncertainties and is based on numerous assumptions. Actual performance, outcomes and results may differ materially from those expressed in forward-looking statements. Representative examples of factors which may cause the actual performance, outcomes and results to differ materially from those in the forward-looking statements include (without limitation) changes in general industry and economic conditions, interest rate trends, cost of capital and capital availability, availability of real estate investment opportunities, competition from other companies, shifts in customers’ demands, changes in operating conditions, including employee wages, benefits and training, governmental and public policy changes and the continued availability of financing in the amounts and the terms necessary to support future business. You are cautioned not to place undue reliance on these forward-looking statements, which are based on the current views of management on future events. All rights are reserved.

Capitaretail China Trustmanagement limitedAs Manager of CapitaRetail China TrustCompany Reg. No.: 200611176D

39 Robinson Road#18-01 Robinson PointSingapore 068911Tel: +65 6536 1188Fax: +65 6536 3884www.capitaretailchina.com

Documents

Propelling Forward - listed companycrct.listedcompany.com/misc/CRCT_Annual_Report_2013.pdf · Propelling Forward CRCT is driven to deliver sustainable and increasing ... Sephora,