[Financial Performance Overview](index=1&type=section&id=Financial%20Performance%20Overview) [Condensed Consolidated Statement of Profit or Loss](index=1&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) The company reported a loss attributable to owners of HK$17,920 thousand for the six months ended June 30, 2023, a reversal from profit in the prior year due to decreased revenue and higher costs | Metric | For the Six Months Ended June 30, 2023 (HK$ thousand) | For the Six Months Ended June 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | | (Loss) Profit Attributable to Owners of the Company | (17,920) | 105,958 | | (Loss) Earnings Per Share (HK cents) | (0.20) | 1.18 | | Total Revenue | 177,953 | 275,401 | | (Loss) Profit Before Tax | (18,347) | 128,551 | | (Loss) Profit for the Period | (17,861) | 106,005 | [Condensed Consolidated Statement of Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) Total comprehensive income for the six months ended June 30, 2023, turned positive from a prior-year loss, driven by favorable exchange differences from foreign operations | Metric | For the Six Months Ended June 30, 2023 (HK$ thousand) | For the Six Months Ended June 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | | (Loss) Profit for the Period | (17,861) | 106,005 | | Fair Value (Loss) Gain on Equity Investments at Fair Value Presented in Other Comprehensive Income | 9,313 | (7,198) | | Exchange Differences on Translation of Foreign Operations | 53,257 | (131,077) | | Other Comprehensive Income (Expense) for the Period | 62,570 | (138,275) | | Total Comprehensive Income (Expense) for the Period | 44,709 | (32,270) | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2023, total assets less current liabilities and total equity slightly increased, while net current liabilities decreased compared to December 31, 2022 | Metric | As of June 30, 2023 (HK$ thousand) | As of December 31, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Non-current Assets | 5,003,416 | 4,971,785 | | Current Assets | 284,319 | 293,723 | | Current Liabilities | 702,804 | 728,990 | | Net Current Liabilities | (418,485) | (435,267) | | Total Assets Less Current Liabilities | 4,584,931 | 4,536,518 | | Equity Attributable to Owners of the Company | 4,270,011 | 4,225,361 | | Total Equity | 4,277,473 | 4,232,764 | | Non-current Liabilities | 307,458 | 303,754 | [Notes to the Financial Statements](index=5&type=section&id=Notes%20to%20the%20Financial%20Statements) [Basis of Preparation](index=5&type=section&id=Basis%20of%20Preparation) These condensed consolidated financial statements adhere to HKAS 34 and Listing Rules Appendix 16, with an unqualified auditor's report - These condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of Appendix 16 to the Listing Rules of The Stock Exchange of Hong Kong Limited[15](index=15&type=chunk) - The company's auditor has issued an unqualified auditor's report on the consolidated financial statements[37](index=37&type=chunk) [Significant Accounting Policies](index=5&type=section&id=Significant%20Accounting%20Policies) Accounting policies and calculation methods remain consistent with the prior year, and new HKFRSs had no significant impact on financial performance or position - The accounting policies and methods of computation adopted in the unaudited condensed consolidated financial statements for the six months ended June 30, 2023, are consistent with those presented in the Group's annual financial statements for the year ended December 31, 2022[38](index=38&type=chunk) - The application of new and revised Hong Kong Financial Reporting Standards during the period had no significant impact on the financial position and performance and/or disclosures in the condensed consolidated financial statements of the Group for the current and prior periods[8](index=8&type=chunk) [Revenue Analysis](index=6&type=section&id=Revenue%20Analysis) Total revenue decreased by **35%** year-on-year, mainly due to a **38%** drop in hotel operations revenue as room rates fell below quarantine service levels | Revenue Source | For the Six Months Ended June 30, 2023 (HK$ thousand) | For the Six Months Ended June 30, 2022 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Hotel Operations Revenue | 159,513 | 256,622 | -38% | | Property Rental Income | 18,395 | 18,737 | -2% | | Dividend Income | 45 | 42 | +7% | | Total Revenue | 177,953 | 275,401 | -35% | - The decrease in hotel revenue was due to lower hotel room rates compared to the period when quarantine hotel services were provided for the six months ended June 30, 2022[49](index=49&type=chunk) [Segment Information](index=7&type=section&id=Segment%20Information) The Group's operating segments are hotel services, property investment, and securities investment, with hotel services experiencing significant declines in revenue and results - The Group's operating and reportable segments include hotel services, property investment, and securities investment[20](index=20&type=chunk)[79](index=79&type=chunk) | Segment | Segment Revenue for the Six Months Ended June 30, 2023 (HK$ thousand) | Segment Revenue for the Six Months Ended June 30, 2022 (HK$ thousand) | Segment Results for the Six Months Ended June 30, 2023 (HK$ thousand) | Segment Results for the Six Months Ended June 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | | Hotel Services | 159,513 | 256,622 | 26,262 | 127,506 | | Property Investment | 18,395 | 18,737 | 18,395 | 18,737 | | Securities Investment | 45 | 42 | 45 | 42 | | Total | 177,953 | 275,401 | 44,702 | 146,285 | [Income Tax](index=9&type=section&id=Income%20Tax) Income tax for the period transitioned from an expense to a credit, driven by Hong Kong deferred tax reversal and reduced current taxes in Hong Kong and China | Income Tax Item | For the Six Months Ended June 30, 2023 (HK$ thousand) | For the Six Months Ended June 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Hong Kong Current Tax | 4,669 | 15,975 | | China Current Tax | 13 | 209 | | UK Current Tax | 2,722 | 3,108 | | Over-provision in Prior Years | - | (40) | | Hong Kong Deferred Tax | (7,890) | 3,294 | | Total Income Tax (Credit) Expense | (486) | 22,546 | - Hong Kong profits tax is recognized based on management's estimated weighted average annual income tax rate of **16.5%** for the entire financial year[96](index=96&type=chunk) [ (Loss) Profit for the Period](index=9&type=section&id=(Loss)%20Profit%20for%20the%20Period) The company reported a loss for the period, influenced by property, plant and equipment depreciation, increased bank interest income, and disposal gains | Item | For the Six Months Ended June 30, 2023 (HK$ thousand) | For the Six Months Ended June 30, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Depreciation of Right-of-use Assets | 394 | 419 | | Depreciation of Property, Plant and Equipment | 35,426 | 38,247 | | Interest on Bank Deposits | (3,152) | (204) | | (Gain) Loss on Disposal of Property, Plant and Equipment | (7) | 449 | [Dividend Policy](index=10&type=section&id=Dividend%20Policy) The Board decided against an interim dividend for the six months ended June 30, 2023, citing slow tourism recovery, lower room rates, rising operating costs, and hotel maintenance expenses - The Board resolved not to declare or recommend an interim dividend for the six months ended June 30, 2023, and June 30, 2022[24](index=24&type=chunk)[97](index=97&type=chunk) - Slow recovery of the tourism industry, reduced room rates, and increased operating costs led to a significant decrease in hotel operating profit[103](index=103&type=chunk) - Higher interest expenses[103](index=103&type=chunk) - Repair and maintenance of Grand Bay View Hotel[103](index=103&type=chunk) - Costs for repair and maintenance of each quarantine hotel to achieve ideal hotel standards[103](index=103&type=chunk) [ (Loss) Earnings Per Share](index=10&type=section&id=(Loss)%20Earnings%20Per%20Share) Basic loss per share was **0.20 HK cents** for the six months ended June 30, 2023, a reversal from prior-year earnings, with no diluted EPS presented due to a lack of potential ordinary shares | Metric | For the Six Months Ended June 30, 2023 (HK cents) | For the Six Months Ended June 30, 2022 (HK cents) | | :--- | :--- | :--- | | Basic (Loss) Earnings Per Share | (0.20) | 1.18 | - Basic (loss) earnings per share is calculated based on the loss attributable to owners of the Company of **HK$17,920,000** for the period (profit for the six months ended June 30, 2022: HK$105,958,000) and **8,947,051,000** shares in issue during the period[98](index=98&type=chunk) - Diluted earnings per share for the current and prior periods are not presented as there were no potential ordinary shares in existence during these periods[25](index=25&type=chunk) [Trade and Other Receivables](index=10&type=section&id=Trade%20and%20Other%20Receivables) As of June 30, 2023, total trade and other receivables significantly decreased, with notable declines in trade receivables and overdue accounts | Item | As of June 30, 2023 (HK$ thousand) | As of December 31, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Trade Receivables (from contracts with customers) | 3,210 | 10,730 | | Other Receivables | 3,542 | 5,329 | | Total | 6,752 | 16,059 | | Aging of Trade Receivables | As of June 30, 2023 (HK$ thousand) | As of December 31, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Not yet due | 2,904 | 8,122 | | Overdue: 0 – 30 Days | 113 | 1,194 | | Overdue: 31 – 60 Days | 62 | 1,057 | | Overdue: 61 – 90 Days | 131 | 357 | | Total | 3,210 | 10,730 | [Trade and Other Payables](index=11&type=section&id=Trade%20and%20Other%20Payables) As of June 30, 2023, total trade and other payables and accruals decreased, mainly due to a decline in other payables and accruals | Item | As of June 30, 2023 (HK$ thousand) | As of December 31, 2022 (HK$ thousand) | | :--- | :--- | :--- | | Trade Payables | 5,351 | 2,487 | | Other Payables and Accruals | 28,180 | 49,428 | | Total | 33,531 | 51,915 | | Aging of Trade Payables | As of June 30, 2023 (HK$ thousand) | As of December 31, 2022 (HK$ thousand) | | :--- | :--- | :--- | | 0 – 30 Days | 4,901 | 2,414 | | 31 – 60 Days | 433 | 72 | | 61 – 90 Days | 17 | 1 | | Total | 5,351 | 2,487 | [Management Discussion and Analysis](index=12&type=section&id=Management%20Discussion%20and%20Analysis) [Overall Performance](index=12&type=section&id=Overall%20Performance) Net profit attributable to owners, before revaluation and depreciation, significantly decreased by **88%** to **HK$18,000 thousand**, driven by lower hotel revenue and higher operating, maintenance, and finance costs | Metric | For the Six Months Ended June 30, 2023 (HK$ thousand) | For the Six Months Ended June 30, 2022 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Net Profit Attributable to Owners of the Company After Tax and Before Depreciation of Land, Property and Equipment | 17,900 | 144,624 | -88% | | Profit (Loss) After Tax and Non-controlling Interests | (17,920) | 105,958 | Not Applicable | - The overall decrease in profit was mainly due to reduced hotel revenue and increased hotel operating costs, repair and maintenance costs, and finance costs[105](index=105&type=chunk) [Revenue Analysis](index=13&type=section&id=Revenue%20Analysis_Management) Total revenue decreased by **35%** year-on-year, primarily due to a **38%** drop in hotel operations revenue, while London's Royal Scot Hotel rental income remained stable with positive growth prospects | Revenue Source | For the Six Months Ended June 30, 2023 (HK$ thousand) | For the Six Months Ended June 30, 2022 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Hotel Operations Revenue | 159,513 | 256,622 | -38% | | Investment Property Income | 18,395 | 18,737 | -2% | | Dividend Income | 45 | 42 | +7% | | Other Income | 3,618 | 3,554 | +2% | | Total | 181,571 | 278,955 | -35% | | Hotel Name | Average Room Occupancy Rate (%) from January to June 2023 | | :--- | :--- | | Ramada Hong Kong Harbour View | 89 | | Ramada Hong Kong Grand | 84 | | Best Western Plus Hotel Hong Kong | 92 | | Grand View Hotel Causeway Bay | 83 | | Best Western Plus Hotel Tsim Sha Tsui | 89 | - The future prospects for rental increases at the Royal Scot Hotel in London are encouraging, as annual rent increases (every 5 years) are linked to the UK Retail Price Index, which remained at **10.7%** in June 2023, its highest point in 40 years[36](index=36&type=chunk)[88](index=88&type=chunk) [Cost Analysis](index=14&type=section&id=Cost%20Analysis) Administrative expenses (excluding depreciation) surged by **194%** to **HK$50,200 thousand**, driven by Grand Bay View Hotel's opening, maintenance, and Wood Street Hotel's operating costs, alongside increased hotel service staff and payroll | Cost Item | For the Six Months Ended June 30, 2023 (HK$ thousand) | For the Six Months Ended June 30, 2022 (HK$ thousand) | Change | | :--- | :--- | :--- | :--- | | Administrative Expenses (excluding depreciation) | 50,200 | 17,100 | +194% | | Cost of Hotel Services | 94,000 | 76,300 | +23% | | Total Depreciation of Hotel Properties | 34,900 | 37,700 | -7% | - The increase in administrative expenses was mainly due to opening expenses, repair and maintenance costs of **HK$29,000 thousand** for Grand Bay View Hotel, and operating expenses of **HK$4,000 thousand** for Wood Street Hotel Limited[50](index=50&type=chunk)[107](index=107&type=chunk) - The increase in hotel operating costs was mainly due to an increase in the number of employees from **334** to **455** and payroll growth (including staff from the newly acquired Grand Bay View Hotel)[57](index=57&type=chunk)[107](index=107&type=chunk) [Financing](index=14&type=section&id=Financing) Total debt slightly increased to **HK$871,000 thousand**, with finance costs surging **351%** to **HK$19,400 thousand** due to increased shareholder loans from the Grand Bay View Hotel acquisition, while gearing and debt-to-asset ratios remained stable | Debt Type | As of June 30, 2023 (HK$ million) | As of December 31, 2022 (HK$ million) | Change (HK$ million) | | :--- | :--- | :--- | :--- | | Bank Loans | 240 | 242 | -2 | | Shareholder Loans | 631 | 615 | +16 | | Total Debt | 871 | 857 | +14 | | Finance Cost Item | For the Six Months Ended June 30, 2023 (HK$ thousand) | For the Six Months Ended June 30, 2022 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Total Interest Expense | 19,400 | 4,300 | +351% | | Interest Expense on Bank Loans | 6,200 | 2,700 | +130% | | Interest Expense on Shareholder Loans | 13,200 | 1,600 | +725% | - As of June 30, 2023, the gearing ratio and debt-to-asset ratio were **9%** and **20%** respectively, remaining stable compared to December 31, 2022[34](index=34&type=chunk)[35](index=35&type=chunk) [Key Business Developments](index=15&type=section&id=Key%20Business%20Developments) Grand Bay View Hotel and Shanghai Grand America Hotel reopened on August 1, 2023, after extensive maintenance, while London's Wood Street Hotel renovation into a luxury hotel is ongoing - Grand Bay View Hotel and Shanghai Grand America Hotel commenced operations on August 1, 2023, following extensive repair and maintenance[58](index=58&type=chunk) - The Group acquired the Wood Street Police Headquarters in central London for **£40,000,000** on January 29, 2020, which has been approved for renovation into a luxury hotel with approximately **216** rooms, restaurants, and bars[52](index=52&type=chunk) - The Group holds eight revenue-generating hotels (six in Hong Kong, one in Shanghai, and one in London) and the renovation project for Wood Street Hotel in London[59](index=59&type=chunk) [Outlook](index=16&type=section&id=Outlook) Hong Kong's tourism recovery is slow due to airline capacity, global economy, and exchange rate challenges, alongside rising operating costs from labor shortages; management focuses on revenue growth and cost control, anticipating high occupancy for other hotels - In the first half of 2023, Hong Kong received approximately **13 million** visitors, compared to **35 million** in the same period of 2019, with tourism recovery impacted by challenges such as airline capacity, global economy, and exchange rates[110](index=110&type=chunk) - Operating costs significantly increased due to local labor shortages and an increase in hotel staff numbers[110](index=110&type=chunk) - The newly acquired Grand Bay View Hotel commenced operations on August 1, 2023, and has maintained high occupancy rates; the Group's other hotels in Hong Kong are also expected to continue achieving high occupancy rates[94](index=94&type=chunk) - The future prospects for hotel business and rental income remain challenging, and management will continue efforts to increase revenue and control costs[117](index=117&type=chunk) [Corporate Governance](index=16&type=section&id=Corporate%20Governance) The company complied with all Corporate Governance Code provisions, except for the combined Chairman and CEO role, which the Board believes provides consistent leadership and cost savings; all directors confirmed Model Code compliance - The company has complied with all code provisions of the Corporate Governance Code as set out in Appendix 14 to the Listing Rules of The Stock Exchange of Hong Kong Limited, except for code provision C.2.1 (which states that the roles of chairman and chief executive officer should be separate)[111](index=111&type=chunk)[116](index=116&type=chunk)[119](index=119&type=chunk) - Mr. Cheng Kai Man currently holds both the Chairman and Chief Executive Officer positions; the Board believes that combining these roles provides strong and consistent leadership for the company, facilitates effective strategic planning and implementation, and significantly saves costs[60](index=60&type=chunk) - All directors have confirmed their compliance with the standards set out in the Model Code throughout the period[61](index=61&type=chunk)[119](index=119&type=chunk) - For the six months ended June 30, 2023, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[118](index=118&type=chunk) [Review and Approval](index=17&type=section&id=Review%20and%20Approval) The Audit Committee has reviewed the Group's unaudited financial results for the six months ended June 30, 2023 - The Audit Committee has reviewed the Group's unaudited financial results for the six months ended June 30, 2023[62](index=62&type=chunk)

Financial Performance - Total revenue for the year 2022 was HKD 439,482,000, an increase of 34.5% compared to HKD 326,398,000 in 2021[146]. - Gross profit for 2022 reached HKD 172,868,000, significantly up from HKD 49,104,000 in 2021, marking a gross margin improvement[146]. - Profit before tax surged to HKD 616,309,000, compared to HKD 73,868,000 in the previous year, reflecting a substantial increase of 736.5%[146]. - Net profit for the year was HKD 592,163,000, a remarkable rise from HKD 65,599,000 in 2021, indicating a growth of 803.5%[146]. - Basic earnings per share for 2022 was HKD 6.63, compared to HKD 0.73 in 2021, representing an increase of 807.5%[146]. - The company reported a gain from the sale of a subsidiary amounting to HKD 521,857,000, which was not present in the previous year[146]. - The fair value of investment properties experienced a net impairment loss of HKD 5,000,000 in 2022, contrasting with a gain of HKD 62,300,000 in 2021[146]. - Administrative expenses increased to HKD 37,977,000 from HKD 33,920,000, reflecting a rise of 6.0%[146]. - Financial costs rose significantly to HKD 23,098,000 from HKD 6,508,000, indicating an increase of 254.5%[146]. - The company's profit attributable to owners for the year ended December 31, 2022, was HKD 593 million, an increase of HKD 527 million compared to HKD 66 million in 2021[172][184]. Assets and Liabilities - The company's total equity as of December 31, 2022, was HKD 4,232,764,000, an increase from HKD 3,738,976,000 on January 1, 2021[66]. - Total non-current assets increased to HKD 4,971,785,000 in 2022 from HKD 4,175,608,000 in 2021, representing a growth of 19%[84]. - The company's total assets minus current liabilities reached HKD 4,536,518,000 in 2022, up from HKD 3,878,597,000 in 2021, an increase of 17%[96]. - Non-current liabilities included bank loans of HKD 219,715,000, which were not present in the previous year[63]. - Net current liabilities increased to HKD 435,267,000 in 2022 from HKD 297,011,000 in 2021, indicating a rise of 47%[96]. - The company’s bank loans decreased significantly to HKD 22,000,000 in 2022 from HKD 310,299,000 in 2021, a reduction of 93%[84]. - The company had unused bank financing totaling HKD 912,000,000 as of December 31, 2022, slightly up from HKD 910,500,000 in 2021[164]. - The overall debt amount is HKD 857 million, with interest payments of approximately HKD 25 million due in the coming year[171]. - As of December 31, 2022, the group's total debt was HKD 857 million, an increase from HKD 504 million in 2021, primarily due to the acquisition of the Ting Lan Hotel for HKD 1.42 billion[193]. Risk Management and Internal Controls - The audit committee reviewed the effectiveness and adequacy of the group's risk management and internal control systems during the year[6]. - The group established a risk management committee in 2019, focusing on business, financial, and property asset management risks[4]. - The board evaluates the effectiveness of existing controls and provides remediation plans when necessary[4]. - The internal audit team conducts independent reviews of the adequacy and effectiveness of the group's internal audit and control systems[4]. Shareholder and Dividend Policies - The company considers actual and future operational and liquidity conditions when deciding on dividend distributions[16]. - The company did not recommend the distribution of a final dividend for the year ended December 31, 2022, consistent with the previous year[35]. - The group has a dividend policy that allows for the declaration of dividends based on profits, with the option to distribute dividends in shares or other specified assets[139]. Hotel Operations and Market Conditions - The group operates eight hotels, with seven in Hong Kong and one in London, facing significant operational expenses and market volatility affecting profit margins[29]. - The market marginal profit for the hotel business is typically between 35% to 40% of total revenue, indicating potential for significant net profit reduction due to revenue reversals[29]. - The average occupancy rates for the hotels in 2022 ranged from 71% to 97%, with the highest being 97% at the Best Western Hotel Tsim Sha Tsui[175]. - Future hotel operations are expected to improve as the impact of COVID-19 lessens, but challenges remain due to economic and geopolitical instability[197]. - The future outlook for hotel and rental income remains challenging, with ongoing efforts to increase revenue and manage costs[198]. Acquisitions and Investments - The group acquired the Ting Lan Hotel at approximately HKD 6,570 per square foot, which includes 435 rooms and a total area of 216,314 square feet, excluding parking spaces[196]. - The group acquired the Wood Street Police Headquarters in London for GBP 40 million, covering 20,000 square feet with a total internal area of 117,472 square feet[199]. Environmental and Social Responsibility - The group aims to minimize its environmental impact through various measures to reduce carbon emissions and improve energy and water efficiency, with regular reviews of these measures[143]. - The company maintains a gender diversity policy, with women representing approximately 44% of both the board and total staff[13].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性或完整性亦不發表任何聲明，並明確 表示，概不對就因本公告全部或任何部分內容而產生或因依賴該等內容而引致的任何損失承擔任何責任。 華大酒店投資有限公司 （於香港註冊成立之有限公司） （股份代號：201） 截至二零二二年十二月三十一日止年度之 末期業績公布 業績 華大酒店投資有限公司（「本公司」）之董事（「董事」）會（「董事會」）宣布截至二零二二年十二月三 十一日止年度之本公司擁有人應佔溢利為593,000,000港元（二零二一年：66,000,000港元），增加527,000,000港 元。本公司及其附屬公司（統稱「本集團」）在本年度之經審核綜合業績連同去年度同期之比較數字如下： 綜合損益表 截至二零二二年十二月三十一日止年度 二零二二年 二零二一年 附註 千港元 千港元 收入 3 客戶合約 403,159 284,082 租賃 36,281 42,316 股息收入 42 - 總收入 439,482 326,398 銷售成本 (25,701) (36,482) 其他服務成本 (166,960) (165,407) 物業、機器及設備 ...

Financial Performance - The profit attributable to the owners for the six months ended June 30, 2022, was HKD 106 million, an increase of HKD 97 million compared to HKD 9 million for the same period in 2021, representing a growth of 1,077.8%[5]. - Total revenue for the group rose by 93% to HKD 278.96 million, compared to HKD 144.71 million in the same period last year, attributed to the operation of quarantine hotels[10]. - Total revenue for the six months ended June 30, 2022, was HKD 275,401,000, a significant increase from HKD 142,476,000 for the same period in 2021, representing an increase of approximately 93.4%[67]. - The net profit for the six months ended June 30, 2022, was HKD 106,005,000, compared to HKD 8,763,000 for the same period in 2021, indicating a substantial increase of approximately 1,107.5%[67]. - Basic earnings per share for the six months ended June 30, 2022, was HKD 1.18, up from HKD 0.10 in the same period of 2021, reflecting a growth of 1,080%[67]. - The total comprehensive income for the six months ended June 30, 2022, was a loss of HKD 32,270,000, compared to a gain of HKD 3,506,000 for the same period in 2021[70]. - The group reported a profit of 105,958,000 HKD for the six months ended June 30, 2022, compared to 8,754,000 HKD for the same period in 2021, indicating a significant increase in profitability[125]. Revenue Sources - Revenue from hotel operations increased by 115% to HKD 256.6 million, up from HKD 119.5 million in the previous year, driven by increased room rates, occupancy, and dining revenue[10]. - Hotel operating revenue reached HKD 256,622,000 for the six months ended June 30, 2022, compared to HKD 119,493,000 in the previous year, marking a growth of 114.5%[103]. - Revenue from room rentals and ancillary services was HKD 238,852,000, up from HKD 118,575,000, reflecting a growth of 101.9%[103]. - The group’s hotel services segment generated an operating profit of HKD 127,506,000 for the six months ended June 30, 2022, compared to HKD 2,348,000 in the same period of 2021, showing a substantial improvement[107]. - The group’s property investment segment reported revenue of HKD 18,737,000, down from HKD 22,983,000 in the previous year, a decrease of 18.8%[107]. - The group’s securities investment segment contributed HKD 42,000 in revenue, unchanged from the previous year[107]. Expenses and Costs - The group’s service costs for the period were HKD 76.3 million, a decrease of HKD 2.9 million from HKD 79.2 million in the previous year[29]. - Administrative expenses increased by 14% to HKD 18.07 million, compared to HKD 15.83 million in the previous year[8]. - Total tax expenses for the six months ended June 30, 2022, amounted to 22,546,000 HKD, a substantial rise from 4,255,000 HKD in the previous year[119]. - The company incurred interest expenses of 4,349,000 HKD for the six months ended June 30, 2022, compared to 3,043,000 HKD for the same period in 2021, reflecting an increase in financial costs[118]. Assets and Liabilities - Non-current assets as of June 30, 2022, totaled HKD 2,426,981,000, down from HKD 2,879,814,000 as of December 31, 2021, representing a decrease of approximately 15.7%[74]. - Current assets as of June 30, 2022, were HKD 3,766,531,000, a decrease from HKD 4,175,608,000 as of December 31, 2021, indicating a decline of about 9.8%[74]. - Current liabilities as of June 30, 2022, were HKD 604,679,000, compared to HKD 572,404,000 as of December 31, 2021, showing an increase of approximately 5.6%[76]. - The total assets of the group as of June 30, 2022, amounted to HKD 4,452,389,000, slightly up from HKD 4,451,001,000 as of December 31, 2021[111]. - The group reported a total liability of HKD 697,420,000 as of June 30, 2022, compared to HKD 663,762,000 at the end of 2021, indicating an increase of 5.4%[114]. - The total equity decreased from 3,787,239 thousand HKD to 3,754,969 thousand HKD, a decline of about 0.9%[82]. Debt and Financing - As of June 30, 2022, the total debt of the group was HKD 492 million, a decrease of HKD 12 million from HKD 504 million as of December 31, 2021[32]. - The bank loans increased by HKD 84 million to HKD 394 million, while shareholder loans decreased by HKD 96 million to HKD 98 million[33]. - New bank loans amounted to 999,500 thousand HKD, indicating a significant increase in financing activities compared to the previous year[92]. - The bank loans secured by the group amounted to HKD 393,863,000 as of June 30, 2022, an increase from HKD 310,299,000 as of December 31, 2021[141][145]. - The effective annual interest rate on bank loans was 1.55% as of June 30, 2022, compared to 1.48% as of December 31, 2021[145]. Corporate Governance - The company has not appointed separate individuals for the roles of Chairman and CEO, with Mr. Zheng concurrently holding both positions, which the board believes provides consistent leadership and cost savings[61]. - The company has complied with the corporate governance code, with the exception of the deviation regarding the dual roles of Chairman and CEO[62]. - The company has adopted the standard code for securities trading by directors and confirmed compliance by all directors during the reporting period[62]. Employee and Shareholder Information - As of June 30, 2022, the company had 412 employees, a decrease from 424 employees as of December 31, 2021[35]. - The company holds 385,395,999 shares in Shun Ho Properties, representing 66.48% of its equity[46]. - The company has 226,454,825 shares in Shun Ho Holdings, accounting for 74.40% of its equity[46]. - The company has not granted any stock options under the employee stock option plan since its adoption in November 2013[48]. - There are no other individuals, apart from directors or senior management, holding interests in the company's shares as per the securities regulations[58]. Acquisitions and Sales - On May 11, 2022, Babenna Limited agreed to sell the entire issued share capital of Huacai Investment Limited for HKD 900 million, pending shareholder approval[39]. - The acquisition of the Tsing Yi Hotel is valued at HKD 1.42 billion, pending shareholder approval[40]. - The sale of the Huacai Investment will assist the group in acquiring the Tsing Yi Hotel at approximately HKD 6,570 per square foot[42]. - The company signed an agreement to acquire all issued shares of Haili for a cash consideration of HKD 1,420,695,000, subject to adjustments based on certain working capital[161]. - The company, through its wholly-owned subsidiary Babenna, entered into a sale agreement to sell all issued shares of Huacai for a cash consideration of HKD 900,000,000, with an adjusted maximum payment expected not to exceed HKD 920,000,000[161]. - Both acquisitions and sales are expected to be completed by September 2022, with the Haili acquisition still pending as of the financial report date[161].

Financial Performance - The company's profit attributable to shareholders for the year ended December 31, 2021, was HKD 66,000,000, an increase of HKD 268,000,000 compared to a loss of HKD 202,000,000 in 2020[7][9]. - Total revenue increased by 40% from HKD 235,072,000 in 2020 to HKD 329,290,000 in 2021, driven by a 54% increase in hotel operating income[11][12]. - Hotel operating income rose to HKD 284,082,000 in 2021 from HKD 183,859,000 in 2020, attributed to increased room rates, occupancy rates, and food and beverage income[11][12]. - The company reported a profit before tax of HKD 73,868,000, a turnaround from a loss of HKD 203,925,000 in 2020[88]. - Net profit for the year was HKD 65,599,000, compared to a loss of HKD 201,710,000 in the prior year[88]. - Basic earnings per share for the year was HKD 0.73, recovering from a loss of HKD 2.25 in 2020[88]. - Gross profit for the year was HKD 49,104,000, compared to HKD 8,778,000 in the previous year, indicating a significant improvement[88]. Revenue and Occupancy - The average occupancy rates for the hotels ranged from 74% to 97% across different properties in 2021[13]. - The tourism market in Hong Kong saw a 97.4% decline in overseas and Chinese tourist arrivals, with most hotels and retailers experiencing over a 90% drop in revenue[21]. - The hotel division's revenue margin is projected to be between 35% to 40% of total revenue[63]. - The group operates eight revenue-generating hotels, with six located in Hong Kong, one in Shanghai, and one in London, alongside the renovation project in London[23]. Expenses and Costs - The service costs for the group increased to HKD 165,400,000 in 2021 from HKD 138,200,000 in 2020, due to the absence of government subsidies to offset salary expenses[14]. - Administrative expenses (excluding depreciation) were HKD 31,000,000 in 2021, slightly up from HKD 30,000,000 in 2020[14]. - Management anticipates continued challenges in the hotel and retail sectors due to the ongoing impact of COVID-19, with low occupancy rates and high operational costs expected to persist[23]. Debt and Financial Position - The overall debt of the group as of December 31, 2021, was HKD 504 million, an increase of HKD 23 million (4.8%) from HKD 481 million in 2020[16]. - Bank loans decreased by HKD 37 million (10.7%) to HKD 310 million in 2021, while shareholder loans increased by HKD 60 million (44.8%) to HKD 194 million[17]. - Total interest expenses for the year were HKD 6.5 million, down from HKD 8.3 million in 2020, primarily due to a reduction in interest rates[17]. - The company reported a net current liability of HKD 297,011,000, worsening from HKD 124,074,000 in 2020[92]. Governance and Management - The company has adopted the corporate governance code as per the Hong Kong Stock Exchange's listing rules, ensuring compliance with all provisions except for specific deviations noted[27]. - The board consists of nine directors, including five executive directors, one non-executive director, and three independent non-executive directors, with two independent directors possessing appropriate professional qualifications or relevant financial management expertise[28]. - The company has established a training and continuous professional development program for directors and senior management[32]. - The board is responsible for evaluating and determining the nature and extent of risks, ensuring effective risk management and internal control systems are maintained[36]. Shareholder Information - The company has established various communication channels with shareholders, including annual general meetings and briefings with investment analysts[50]. - The company’s retained earnings as of December 31, 2021, amounted to HKD 1,807,880,000, an increase from HKD 1,772,277,000 in 2020[51]. - The board does not recommend the payment of a final dividend for the year ending December 31, 2021, consistent with the previous year[51]. - The company has adopted a dividend policy aimed at providing stable and sustainable returns to shareholders, subject to various factors including financial condition and operational needs[50]. Investment and Property Management - The group acquired the Wood Street Police Headquarters in London for GBP 40 million, with plans to renovate it into a luxury hotel with approximately 216 rooms[22]. - The group owns approximately HKD 1,122,000,000 in investment properties located in Hong Kong and the UK as of December 31, 2021[69]. - The net fair value increase of investment properties recognized in the income statement for the year was approximately HKD 62,000,000[69]. - The carrying value of hotel properties as of December 31, 2021, is approximately HKD 2,340,000,000[26]. Risk Management - The company established a risk management committee in 2019, consisting of three executive directors, to oversee business, financial, and property asset management risks[37]. - The audit committee reviews the effectiveness of the risk management and internal control systems and reports to the board[37]. - The group conducted a going concern assessment, considering the ongoing impact of COVID-19 and available liquidity sources, which supports the preparation of financial statements on a going concern basis[125]. Accounting and Financial Reporting - The group adopted revised Hong Kong Financial Reporting Standards, which became mandatory this year, with no significant impact on the financial position and performance for the current and prior years[109]. - The consolidated financial statements are prepared based on historical cost, except for investment properties and certain financial instruments measured at fair value[126]. - The group recognizes rental income from operating leases on a straight-line basis over the lease term[152]. - Financial assets are classified and measured at amortized cost if held to collect contractual cash flows and cash flows solely represent payments of principal and interest[168].

Financial Performance - The company reported a profit attributable to owners of HKD 9,000,000 for the six months ended June 30, 2021, compared to a loss of HKD 154,000,000 for the same period in 2020, representing an increase of HKD 163,000,000[5]. - Total revenue increased by 45% to HKD 144,705,000 for the six months ended June 30, 2021, up from HKD 99,787,000 in the same period of 2020, primarily due to increased hotel occupancy and rental income[10]. - The company reported a profit before tax of HKD 13,018,000 for the six months ended June 30, 2021, compared to a loss of HKD 158,725,000 in the same period of 2020[71]. - Basic earnings per share for the six months ended June 30, 2021, was HKD 0.10, a significant improvement from a loss of HKD 1.72 in the same period of 2020[71]. - The total comprehensive income for the six months ended June 30, 2021, was HKD 3,506,000, compared to a loss of HKD 305,880,000 in the same period of 2020[78]. - The company experienced a fair value loss on equity investments of HKD 25,291,000 for the six months ended June 30, 2021, compared to a loss of HKD 75,997,000 in the same period of 2020[75]. - The company reported a foreign exchange gain of HKD 20,034,000 due to the translation of overseas operations for the six months ended June 30, 2021, compared to a loss of HKD 76,024,000 in the same period of 2020[76]. - The company’s gross profit for the six months ended June 30, 2021, was HKD 25,331,000, compared to a gross loss of HKD 28,090,000 in the same period of 2020[71]. Revenue Sources - Hotel operating income rose by 67% to HKD 119,493,000, compared to HKD 71,463,000 for the same period last year, driven by increased room rates and occupancy[10]. - Investment property income increased by 22% to HKD 22,983,000, attributed to rental income from the Royal Scot Hotel and other properties[10]. - The rental income from the Royal Scot Hotel in London increased by 8% compared to the same period last year[33]. - The company’s total income from customer contracts, leases, and dividend income for the six months ended June 30, 2021, was HKD 119,493,000, compared to HKD 71,463,000 in the same period of 2020, indicating a 67.3% increase[71]. Expenses and Costs - Service costs for the period were HKD 79,500,000, a slight decrease from HKD 80,600,000 in the previous year[26]. - Administrative expenses (excluding depreciation) were HKD 14,500,000, down from HKD 15,400,000 in the same period last year[26]. - Depreciation for hotel properties was HKD 37,700,000 for the period, slightly down from HKD 37,800,000 in the previous year[26]. - Financial costs decreased to HKD 3,043,000 for the six months ended June 30, 2021, from HKD 4,582,000 in the same period of 2020[71]. Debt and Financial Position - As of June 30, 2021, the total debt of the group was HKD 531 million, an increase of HKD 50 million from HKD 481 million on December 31, 2020[29]. - The capital-to-debt ratio increased to 14% from 13% as of December 31, 2020, based on total debt relative to the revalued hotel properties[29]. - The total interest expense for the period was HKD 3 million, down from HKD 4.6 million in the same period last year, primarily due to a decrease in interest rates[31]. - The group’s total liabilities included HKD 53,548 million in classified liabilities, up from HKD 47,668 million in the previous year, marking an increase of approximately 12.4%[123]. - The group’s total liabilities increased to HKD 684,563 million as of June 30, 2021, compared to HKD 631,902 million in the previous year, reflecting a growth of approximately 8.3%[123]. Employee and Operational Changes - The group had a total of 436 employees as of June 30, 2021, down from 498 employees on December 31, 2020[31]. - Management anticipates low likelihood of overseas and Chinese tourists returning to Hong Kong for the remainder of 2021, impacting hotel occupancy rates and operational costs[36]. - The company operates seven hotels and leases one hotel in London, with five of the local hotels designated as quarantine hotels since January 2021[10]. Governance and Shareholding - Major shareholder Shun Ho Properties holds 6,360,585,437 shares, representing 71.09% of the total shares[45]. - Credit Suisse Trust Limited and associated entities collectively hold 782,114,500 shares, accounting for 8.74% of the total shares[47]. - FMR LLC holds 469,451,000 shares, which is 5.25% of the total shares[52]. - The company has not appointed separate individuals for the roles of Chairman and CEO, with the current individual holding both positions[56]. - The company has adopted a revised nomination committee charter to fully comply with governance code requirements as of March 19, 2021[58]. Cash Flow and Assets - The company reported a net cash inflow from operating activities of HKD 55,097 thousand, a substantial improvement compared to an outflow of HKD 7,135 thousand in the same period last year[90]. - Current assets increased to HKD 258,271 thousand from HKD 163,429 thousand, with cash and cash equivalents rising significantly to HKD 242,483 thousand from HKD 143,317 thousand[82]. - The group recorded a positive operating cash inflow of HKD 48,627,000 and a net increase in cash and cash equivalents of HKD 97,703,000[97]. - The group has unused bank financing totaling HKD 910,500,000 as of June 30, 2021[97]. Impact of COVID-19 - The company did not declare an interim dividend for the six months ended June 30, 2021, due to the ongoing impact of the COVID-19 pandemic on hotel revenues and cash flow stability[6]. - The majority of hotels and retailers in Hong Kong experienced a revenue decline of over 90% due to the impact of COVID-19[32]. - The group’s financial position and performance have been affected by the COVID-19 pandemic and related travel restrictions[99]. - The group’s management conducted a going concern assessment considering the ongoing impact of the COVID-19 pandemic[97].

| --- | --- | |-------|------------------------------------------------------------------------------------------------| | | | | | MAGNIFICENT HOTEL INVESTMENTS LIMITED 華 大 酒 店 投 資 有 限 公 司 (Stock Code 股份代號: 201) | | | | | | | | | | 錄 日 | --- | --- | |--------------------|-------| | | 頁數 | | 公司资料 | 2 | | 主席報告 . | 3-6 | | 董事简介 . | 7 | | 企業管治報告 . | 8-16 | | 董事會報告 | 17-23 | | 獨立核數師報告 | 24-28 | | 综合損益表 | 29 | | 綜合總全面收益表 . | 30 | | 综合財務狀況表 | 31-32 | | 综合權益變動報表 | 33 | | 综合現金流量表 | 34-35 | | 综合財務報表附註 | 36-94 | | 財務概 ...

Financial Performance - The company reported a loss attributable to owners of HKD 154 million for the six months ended June 30, 2020, a decrease of HKD 212 million compared to a profit of HKD 58 million for the same period in 2019[5]. - Total revenue decreased by 64% from HKD 277 million to HKD 99.8 million, primarily due to a 71% drop in hotel operating income[10]. - Hotel operating income fell to HKD 71.5 million, down from HKD 248.4 million in the previous year, reflecting reduced occupancy rates and rental income[12]. - The company did not declare an interim dividend for the six months ended June 30, 2020, compared to HKD 0.08 per share in the same period of 2019[6]. - The company reported a total comprehensive income of HKD 64,590,000 for the six months ended June 30, 2020, compared to a total comprehensive income of HKD 57,599,000 for the same period in 2019, reflecting an increase of approximately 12.93%[94]. - The group reported a loss before tax of HKD 158,725,000 for the period, compared to a profit of HKD 71,490,000 in the previous year[121]. - The group reported a loss of HKD 153,859,000 for the six months ended June 30, 2020, compared to a profit of HKD 57,599,000 for the same period in 2019[139]. Revenue and Income Sources - The rental income from the Royal Scot Hotel in London increased by 12% to HKD 17.5 million, compared to HKD 15.6 million in the previous year[13]. - The group recognized government subsidies related to COVID-19 amounting to HKD 7,457,000, with HKD 4,207,000 linked to the Employment Support Scheme[104]. - Property rental income increased to HKD 18,782,000 from HKD 16,739,000, marking a growth of 12.3% year-on-year[121]. - The group’s securities investment income was HKD 53,000, compared to HKD 3,557,000 in the previous year, indicating a significant decrease[121]. Operational Changes - The company currently operates seven hotels and leases one hotel in London, with plans to rebrand the Glamour Hotel to a higher-end Ramada Glamour Hotel in August 2020[12]. - The average room occupancy rate across the hotels was significantly impacted, with declines ranging from 64% to 80% compared to the previous year[12]. - During the period, the group's operational costs were reduced by HKD 63 million (44%) while maintaining an occupancy rate above 80% despite a 90% drop in revenue from hotels and retail due to local unrest and COVID-19[32]. - The group plans to continue monitoring market conditions and adjust strategies accordingly in response to the ongoing pandemic[104]. Debt and Equity - The group's total debt as of June 30, 2020, was HKD 772 million, an increase of HKD 353 million (84%) compared to HKD 419 million on December 31, 2019[27]. - The capital-to-debt ratio increased to 21% from 10% as of December 31, 2019, based on total debt of HKD 772 million relative to the revalued hotel properties[27]. - Total equity decreased to HKD 3,685,330,000 as of June 30, 2020, down from HKD 3,991,210,000 at the end of 2019, representing a decline of approximately 7.66%[89]. - The company’s bank loans decreased to HKD 238,664,000 as of June 30, 2020, down from HKD 266,024,000 at the end of 2019, a decrease of approximately 10.34%[90]. Staffing and Management - The group employed 503 staff as of June 30, 2020, down from 618 staff as of December 31, 2019[31]. - The company has not appointed separate individuals for the roles of Chairman and CEO, with the current CEO also serving as Chairman[67]. - The company has adopted measures to ensure compliance with corporate governance standards, despite some deviations noted[68]. - The company’s management compensation decreased from HKD 4,771 million to HKD 4,119 million, a reduction of approximately 13.7%[160]. Compliance and Governance - The interim results for the six months ending June 30, 2020, were reviewed by Deloitte, confirming compliance with Hong Kong accounting standards[65]. - The company confirmed compliance with the standard code of conduct for securities trading by all directors for the six months ended June 30, 2020[72]. - The company’s board consists of both executive and non-executive directors, with a rotation policy ensuring directors retire at least every three years[68]. Asset Management - Cash and cash equivalents increased to HKD 390,674,000 from HKD 82,502,000 as of December 31, 2019[86]. - Non-current assets decreased to HKD 4,184,847,000 from HKD 4,476,243,000 as of December 31, 2019[86]. - The fair value of investment properties increased to approximately HKD 1,383,000,000 from HKD 1,098,000,000, representing a growth of 26%[142]. - The group incurred a loss of HKD 116,429,000 from changes in the fair value of investment properties for the six months ended June 30, 2020[142].

Financial Performance - The company reported a loss attributable to shareholders of HKD 154 million for the six months ended June 30, 2020, compared to a profit of HKD 58 million for the same period in 2019, a decrease of HKD 212 million [4]. - Total revenue for the six months ended June 30, 2020, was HKD 90.298 million, down from HKD 268.666 million in the same period of 2019, representing a decline of approximately 66.5% [4]. - The company recorded a gross loss of HKD 28.09 million for the period, compared to a gross profit of HKD 85.393 million in the previous year [4]. - The fair value loss on investment properties was HKD 116.429 million, significantly impacting overall financial performance [4]. - The company’s basic loss per share for the period was HKD (1.72), compared to earnings per share of HKD 0.64 in the previous year [4]. - The group reported a loss of HKD 153,859,000 for the six months ended June 30, 2020, compared to a loss of HKD 57,599,000 for the same period in 2019 [26]. - The basic loss per share for the period was HKD 0.0172, compared to HKD 0.0064 for the same period last year [26]. - Total revenue decreased by 64% from HKD 277 million to HKD 99 million for the six months ended June 30, 2020, primarily due to reduced hotel rental and occupancy rates [36]. - Operating hotel revenue fell by 71% to HKD 71 million, down from HKD 248 million in the same period last year [36]. Assets and Liabilities - The company’s total assets decreased to HKD 4.184 billion as of June 30, 2020, from HKD 4.476 billion as of December 31, 2019, a reduction of approximately 6.5% [7]. - The company’s net current liabilities increased to HKD 170.576 million, compared to HKD 119.623 million at the end of 2019, reflecting a worsening liquidity position [7]. - The company’s total equity decreased to HKD 3.685 billion from HKD 3.991 billion, a decline of approximately 7.7% [7]. - As of June 30, 2020, the total debt of the group was HKD 772 million, an increase of 84.3% from HKD 419 million on December 31, 2019 [45]. - The capital-to-debt ratio increased to 21% from 10% year-on-year, calculated based on total debt relative to the revalued hotel properties [45]. Cash Flow and Liquidity - Cash and cash equivalents increased to HKD 390.674 million from HKD 82.502 million, indicating improved liquidity [7]. - The company has several financial resources available for operations, including internal resources and unused bank financing, ensuring continued operations despite current losses [10]. Operational Performance - Hotel operating income for the six months ended June 30, 2020, was HKD 71,463,000, down 71.2% from HKD 248,370,000 in the previous year [3]. - The group reported a significant decrease in operating profit from hotel services, with a loss of HKD 46,925,000 for the six months ended June 30, 2020, compared to a profit of HKD 65,097,000 in the same period of 2019 [17]. - The group’s total administrative expenses for the period were HKD 144,519,000, an increase from HKD 85,393,000 in the same period last year [17]. - The service cost for the period was HKD 80.6 million, a decrease of HKD 62.6 million or 44% compared to HKD 143.2 million for the same period in 2019 [40]. - During the period, operational costs were reduced by HKD 63 million, representing a 44% decrease, while maintaining an occupancy rate above 80% [49]. Dividends and Shareholder Returns - No interim dividend was declared for the six months ended June 30, 2020, compared to an interim dividend of HKD 0.08 per share amounting to HKD 7,158,000 for the same period in 2019 [25]. - The company did not recommend an interim dividend for the six months ended June 30, 2020, compared to HKD 0.08 per share for the same period in 2019 [32]. Investments and Acquisitions - The group’s property investment income was HKD 18,782,000 for the six months ended June 30, 2020, compared to HKD 16,739,000 in the previous year, reflecting a growth of 12.3% [17]. - The group acquired the Wood Street Police Headquarters in London for GBP 40 million, with plans for renovation to create a luxury hotel with approximately 210 rooms [50]. - The independent valuation of Royal Scot Hotel was GBP 88.5 million as of June 30, 2020, down from GBP 95 million a year earlier [38]. - The company currently operates eight hotels, with seven in operation and one leased in London, Royal Scot Hotel, which had a rental income of HKD 17.5 million for the period [38]. - Rental income from the Royal Scot Hotel in London increased by 12% compared to the same period last year [50]. Employment and Staffing - The group employed a total of 503 staff as of June 30, 2020, down from 618 staff at the end of 2019 [47]. Market Conditions and Outlook - The ongoing impact of COVID-19 and geopolitical tensions is expected to continue affecting the hotel and retail sectors, leading to low occupancy rates and high operational costs [51]. - The group anticipates that overseas and Chinese tourists will not return in significant numbers for the remainder of the fiscal year due to ongoing uncertainties [51]. Interest and Financing - Interest expenses increased to HKD 4.6 million from HKD 4 million due to the rise in shareholder loans during the period [46]. Taxation - The weighted average annual income tax rate used for the period was 16.5%, consistent with the previous year [19]. Other Financial Metrics - Trade receivables decreased to HKD 2,038,000 as of June 30, 2020, from HKD 3,408,000 as of December 31, 2019, indicating a decline of 40.2% [28]. - Administrative expenses (excluding depreciation) increased to HKD 15.4 million from HKD 14.9 million due to professional fees related to the acquisition of Wood Street Hotel in London [42]. - The company experienced a 99% decrease in securities investment income, dropping to HKD 53, down from HKD 3.6 million in the previous year [34].

Financial Performance - The company reported a total revenue of HKD 1,185,000 for the fiscal year ending December 31, 2019[9]. - The company's profit attributable to owners for the year ended December 31, 2019, was HKD 32 million, a decrease of 88% compared to HKD 260 million in 2018[12]. - The overall profit for the year decreased by approximately HKD 228 million, primarily due to reduced hotel profits and revaluation losses in the second half of the year[26]. - Total revenue decreased by 21%, from HKD 590 million to HKD 464 million[38]. - Hotel operating revenue fell by 28% to HKD 386.6 million, primarily due to reduced rental income[38]. - Total revenue for the year was HKD 54,708,000, a decrease of 22% compared to HKD 69,846,000 in 2018[66]. - Operating income was HKD 16,377,000, down 49% from HKD 32,409,000 in 2018[67]. - Total revenue for the group decreased from HKD 580 million in 2018 to HKD 428 million in 2019, a decline of approximately 26.2%[102]. - Gross profit for the year was HKD 85,712,000, down 64.7% from HKD 243,241,000 in the previous year[194]. - Profit before tax decreased significantly to HKD 46,133,000, compared to HKD 297,812,000 in 2018, representing a decline of 84.5%[194]. - Net profit attributable to shareholders for the year was HKD 31,831,000, a decrease of 87.8% from HKD 260,349,000 in the prior year[194]. Revenue Sources - The rental income from properties increased by 4%, totaling HKD 31.598 million for the year[26]. - Revenue from hotel properties increased by 3% to HKD 35.9 million, driven by rental income from UK hotel properties[38]. - Dividend income rose by 3% to HKD 5.0 million, attributed to increased dividends from stock investments[38]. - The company reported a significant increase of 265% in other income and expenses, totaling HKD 36.850 million[26]. Expenses and Costs - Administrative expenses increased by 2%, amounting to HKD 40.404 million for the year[26]. - The income tax expense decreased by 62%, totaling HKD 14.302 million for the year[26]. - The group incurred a depreciation expense of HKD 76 million for hotel properties in 2019, up from HKD 71 million in 2018, representing an increase of 7.5%[102]. - Financial costs decreased to HKD 8,025,000 from HKD 13,759,000, a reduction of 41.1%[194]. Corporate Governance - The company has a strong commitment to corporate governance, adhering to the principles of high-quality board composition and internal controls, ensuring transparency and accountability to shareholders[125]. - The board has approved the adoption of the corporate governance code as per the Hong Kong Stock Exchange Listing Rules, ensuring compliance with all relevant guidelines[125]. - The company has established a remuneration committee that complies with the governance code, although it does not have the responsibility to approve compensation for executive directors[125]. - The company emphasizes cost-saving measures by having the Chairman also fulfill the role of CEO, avoiding the need for hiring an additional executive at a high salary[125]. - The board consists mainly of independent non-executive directors, ensuring a level of oversight and independence in decision-making[125]. Shareholder Matters - The company plans to hold its annual general meeting on May 22, 2020, to discuss the audited financial statements for the year[6]. - The company emphasizes the importance of shareholder participation in the upcoming annual general meeting[9]. - Shareholders can request the convening of a general meeting if they hold at least 5% of the total voting rights[144]. - The company must issue a notice for a resolution if requested by shareholders holding at least 2.5% of the voting rights[144]. Market Conditions - The majority of hotel revenue in Hong Kong has dropped by over 90% due to factors such as social instability and the COVID-19 pandemic[135]. - Over 70% of tourists to Hong Kong come from China, making the political and economic stability in China critical for visitor numbers[135]. - The management anticipates that the adverse business environment will persist for some time[135]. Property and Investments - The company has a direct ownership of 50.60% in Trillion Resources[169]. - The group owns approximately HKD 1,098,000,000 in investment properties, including commercial properties in Hong Kong and a hotel in the UK[178]. - The impairment loss recognized for investment properties during the year was approximately HKD 28,000,000[178]. - The carrying amount of loss-making hotel properties was approximately HKD 989,000,000 as of December 31, 2019[179]. Risk Management - The company has established a risk management committee and an internal audit team to oversee financial and operational risks[134]. - The board is responsible for evaluating the effectiveness of the group's risk management and internal control systems[134]. - The company ensures that financial statements are prepared in accordance with applicable regulations and accounting standards[134]. Stock Options and Shareholding - The company has not issued any new stock options since the adoption of the stock option plan in 2013 and does not anticipate issuing new options in 2020[159]. - The stock option plan aims to reward participants for their contributions to the group and is subject to shareholder approval for any options exceeding 1% of the issued shares[159]. - The company holds a total of 6,360,585,437 shares, representing 71.09% of the equity, with significant ownership by Zheng Qiweng[158].