Revenue and Profitability - Revenue for the year ended June 30, 2023, increased by 12% to HKD 2,346 million, driven by demand from "hyperscale" customers for data center space and price increases for existing customers[2] - Profit attributable to shareholders increased by 7% to HKD 905 million, indicating solid profitability growth[2] - The group's revenue increased by 12% year-on-year to HKD 2.346 billion, driven by demand from existing and new customers in data center and IT facilities[16] - Revenue from data center and IT facilities rose by 11% to HKD 2.161 billion, supported by new contracts signed in the 2022/23 fiscal year[16] - Operating profit increased by 14% year-on-year to HKD 1.192 billion, with EBITDA rising by 12% to HKD 1.677 billion, maintaining a strong EBITDA margin of 71%[16] - The company reported a pre-tax profit of HKD 1,083,694,000 for the year ended June 30, 2023, compared to HKD 1,012,865,000 for the previous year[39] Investments and Projects - The company plans to invest over HKD 1.5 billion in the MEGA IDC project, which will more than double the existing design power capacity of approximately 100 MW[4] - The MEGA IDC facility is expected to be operational next year, with significant customer interest already secured[5] - The company has acquired sufficient land to meet growth demands for the next four years, with the upcoming MEGA IDC providing an additional 700,000 square feet of data center space[8] - The MEGA IDC flagship project will provide around 1.2 million square feet of total floor area and support up to 180 megawatts of IT power capacity, with the first phase expected to be completed in Q4 2023[12] - The company is investing in new data center projects to enhance capacity in response to increasing data demands, indicating a commitment to long-term capital investment[17] Financial Position and Equity - The total equity of the group as of June 30, 2023, is HKD 4.7 billion, which could increase to HKD 29.8 billion based on independent property valuations[6] - The adjusted debt-to-equity ratio could significantly decrease to 45% (including shareholder loans) and 32% (excluding shareholder loans) based on market valuations[6] - As of June 30, 2023, total equity amounted to HKD 4,655,821,000, an increase from HKD 4,591,536,000 as of June 30, 2022, reflecting a growth of approximately 1.4%[24] - The company’s retained earnings reached HKD 1,753,006,000 as of June 30, 2023, up from HKD 1,684,299,000 a year earlier, representing an increase of approximately 4.1%[24] Costs and Expenses - The company is taking measures to manage rising costs, particularly in labor, construction, and equipment, while maintaining a focus on cost discipline[5] - The company is facing ongoing inflationary pressures, with rising operational costs including wages and construction materials, which have increased financing costs due to high interest rates[12] - Financing costs rose by 266% to HKD 109 million due to increased loan rates and levels[16] - The company’s total financial costs for 2023 were 108,772 thousand HKD, significantly higher than 29,715 thousand HKD in 2022, marking an increase of about 265.5%[45] Dividends - The proposed final dividend for the year ended June 30, 2023, is HKD 0.112 per share, with a payout ratio of approximately 50%, down from around 100% in recent years[4] - The company declared a final dividend of HKD 787,313,000 for the year, consistent with the previous year's distribution[24] - The total dividend for the year ending June 30, 2023, is HKD 0.112 per share, compared to HKD 0.208 per share for the previous year[59] Customer Demand and Market Position - There is strong demand for "hyperscale" capacity, particularly from major cloud service providers, with increased inquiries and contract renewals from existing customers[5] - The company is strategically positioned to capitalize on the increasing demand for high-density power from cloud service providers and new economy companies[10] - The company has received multiple customer commitments for the MEGA IDC, indicating strong demand for its data center services[12] Employee and Operational Metrics - The company employed 461 full-time employees as of June 30, 2023, focusing on employee health and safety while maintaining high service standards[19] - The total employee compensation for 2023 was 279,392 thousand HKD, up from 252,784 thousand HKD in 2022, reflecting an increase of approximately 10.5%[45] Compliance and Governance - The company has complied with the corporate governance code as per the Hong Kong Stock Exchange listing rules for the year ending June 30, 2023[64] - The company's financial statements for the year ending June 30, 2023, have been reviewed by the audit committee and audited by Deloitte, with an unmodified opinion issued[63] Accounting Standards and Regulations - The company applied revised Hong Kong Financial Reporting Standards for the first time in the current year, which did not significantly impact its financial position or performance[28] - The company expects that the application of new and revised Hong Kong Financial Reporting Standards will not have a significant impact on the consolidated financial statements in the foreseeable future[29] - The amendments to HKAS 12 regarding international tax reform require separate disclosure of current tax expenses/income related to the second pillar tax during the reporting period starting on or after January 1, 2023[30]

Financial Performance - Revenue increased by 11% year-on-year to HKD 1,108 million for the six months ended December 31, 2022, driven by new and existing customer demand for data center services[6] - EBITDA rose by 11% year-on-year to HKD 805 million, reflecting strong operational performance[5] - Profit attributable to shareholders increased by 6% year-on-year to HKD 433 million[5] - Revenue increased by 11% year-on-year to HKD 1.108 billion, driven by demand from existing and new customers in data center and IT facilities[16] - Operating profit rose by 11% year-on-year to HKD 558 million, with EBITDA also increasing by 11% to HKD 805 million, maintaining a strong EBITDA margin of 73%[16] - Gross profit for the same period was HKD 630,619, representing a gross margin of 56.8%, compared to HKD 585,272 and a margin of 58.8% in the prior year[46] - Operating profit increased to HKD 558,156, up 10.7% from HKD 504,112 year-on-year[46] - Profit attributable to shareholders for the period was HKD 433,124, a rise of 5.5% from HKD 410,338 in the previous year[46] - Basic earnings per share for the period was HKD 0.1067, compared to HKD 0.1011 in the same period last year, reflecting a 5.5% increase[46] - Total comprehensive income for the period was HKD 433,153, slightly up from HKD 410,327 in the previous year[47] Business Growth and Expansion - The data center business generated HKD 815.9 million in EBITDA, indicating robust growth in this segment[4] - Strong demand from cloud service providers continues, with several clients expanding their capacity in the company's facilities[7] - The completion of MEGA Gateway adds approximately 200,000 square feet of floor area and 20 megawatts of power capacity, with over 60% of the space already committed by customers[9] - The total floor area of data centers in Hong Kong will expand from 1.5 million square feet as of December 31, 2022, to nearly 3 million square feet after the completion of MEGA Gateway and MEGA IDC[12] - The power capacity of the data centers will increase from 80 megawatts to over 280 megawatts following the full operation of the new facilities[12] - MEGA IDC's first phase, targeting 500,000 square feet, is expected to be operational by Q4 2023, with a second phase of approximately 700,000 square feet planned for 2026[12] - The MEGA Gateway and MEGA IDC projects are part of a robust growth plan, positioning the group to benefit from the ongoing demand for data centers in Asia and Hong Kong[10] Sustainability and Efficiency - The company is investing in energy efficiency projects to reduce operational costs and carbon footprint amid rising inflation and energy prices[7] - The group is committed to investing in energy-efficient equipment and infrastructure for its data centers, achieving top ratings in green building certifications[9] - The group declared and distributed dividends totaling HKD 844,287,000, an increase of 7.2% from HKD 787,313,000 in the previous year[82] Capital Structure and Financing - The company is managing its capital structure prudently during the current interest rate hike cycle to ensure cost-effective financing[7] - The group’s net bank loans increased by 15% to approximately HKD 8.968 billion as of December 31, 2022[18] - The group’s debt ratio (net debt to equity) was 306%, which would drop to 215% when excluding a long-term unsecured shareholder loan of HKD 3.8 billion[18] - The company has considered various funding sources for future liquidity, including internal resources and available bank credit lines[53] - New bank loans raised during the period totaled HKD 1,150,000,000, a substantial increase from HKD 400,000,000 in the previous year[52] Legal and Regulatory Matters - The company has received a favorable final judgment regarding a legal case related to the Tseung Kwan O Industrial Estate, which supports a competitive environment in the data center industry[8] - The company confirmed compliance with the corporate governance code during the six-month period ending December 31, 2022[114] - All directors confirmed adherence to the standard code of conduct for securities trading during the same period[113] Management and Governance - The company reported a director's fee of HKD 52,500 and total compensation of approximately HKD 8,908,000 for the CEO for the fiscal year ending June 30, 2022[22] - The company’s COO received a director's fee of HKD 45,000 and total compensation of approximately HKD 4,929,000 for the fiscal year ending June 30, 2022[25] - The company emphasizes annual reviews of executive compensation based on market levels and individual contributions[22] - The board of directors consists of five executive directors, six non-executive directors, and six independent non-executive directors as of the report date[114] Shareholder Information - Major shareholders include Sunco Resources Limited and HSBC Trustee (C.I.) Limited, holding a combined total of 3,441,594,000 shares, representing 147.14% of the issued share capital[107] - The company has authorized a total of 233,905,733 stock options under the 2022 plan, effective from November 1, 2022[104] - The company holds 963,536,900 shares in Vivid Synergy Limited, representing 20.00% of the issued shares as of December 31, 2022[99] Operational Metrics - The company reported a financial cost of HKD 38,160, significantly higher than HKD 13,687 in the prior year, indicating increased borrowing costs[46] - The company incurred a net cash outflow from investing activities of HKD 883,126,000, compared to HKD 618,196,000 in the prior period, indicating a significant increase in capital expenditures[52] - The total amount of property, plant, and equipment additions was approximately HKD 1,225,215,000, significantly higher than HKD 853,722,000 in the previous year, showing increased investment in assets[71]

Financial Performance - Revenue for the period ending June 30, 2022, was HKD 2,085,845, an increase from HKD 1,873,950 in the previous year, representing a growth of approximately 11%[6] - EBITDA for the data center business reached HKD 786,035, reflecting an increase from HKD 747,046 in the previous year, which is a growth of about 5%[6] - The company reported a net profit attributable to shareholders of HKD 436,493 for the period, up from HKD 410,338 in the previous year, marking an increase of about 6%[6] - Operating profit for the period was HKD 538,468, compared to HKD 504,112 in the previous year, indicating a growth of approximately 7%[6] - Revenue for the year ended June 30 increased by 11% to HKD 2.086 billion, driven by demand from existing and new customers for data centers[15] - EBITDA rose by 10% to HKD 1.501 billion, or 11% when excluding COVID-19 related subsidies[16] - Profit attributable to shareholders increased by 8% to HKD 847 million, or 9% when excluding COVID-19 related subsidies[16] - The group reported a revenue increase of 11% year-on-year to HKD 2.086 billion, driven by demand from existing and new customers in data centers and IT facilities[29] - The operating profit rose by 8% year-on-year to HKD 1.043 billion, with data center and IT facilities contributing to a 9% increase in operating profit before corporate expenses, interest, and tax[29] - The EBITDA increased by 10% year-on-year to HKD 1.501 billion, maintaining a strong EBITDA margin of 72% due to economies of scale and cost efficiency improvements[29] Data Center Operations - The total floor area of data centers is approximately 3 million square feet, with a market share of around 26%[8] - The company operates 6 data centers, with a total floor area of 1.5 million square feet, contributing significantly to its revenue stream[8] - Two new data centers are under construction, with a total floor area of 1.4 million square feet and power capacity increasing from 80 MW to over 280 MW[10] - The company plans to expand its data center capabilities, leveraging government-designated land for high-end data center use in Tseung Kwan O[8] - Demand for "hyperscale" capacity remains strong, with most cloud service customers expanding their capacity in the company's data centers[16] - The company has a strong growth plan, with total data center floor area in Hong Kong expected to expand from 1.5 million square feet to nearly 3 million square feet after the completion of new projects[19] - Power capacity will increase from the current 80 MW to over 280 MW to meet growing customer demand[19] - MEGA IDC, the flagship project in Tseung Kwan O, aims to become the largest single data center in Hong Kong with a first phase floor area of approximately 500,000 square feet, targeting a 2023 opening[19] - The second phase of MEGA IDC will have a floor area of approximately 700,000 square feet, with a target opening in 2026[19] - The company is recognized as the largest telecommunications-neutral and cloud-neutral data center operator in Hong Kong, well-positioned to benefit from the ongoing demand growth in the data center market[20] Financial Position and Debt - Total assets as of June 30, 2022, were HKD 18,142,782, with total liabilities of HKD 13,551,246, resulting in total equity of HKD 4,591,536[7] - As of June 30, 2022, the group's bank balance and deposits were HKD 310 million, with bank loans totaling HKD 8.087 billion, resulting in net bank loans of approximately HKD 7.777 billion, a 7% increase from HKD 7.292 billion on December 31, 2021[31] - The group's debt ratio (net debt to equity attributable to shareholders) was 253% as of June 30, 2022; excluding the HKD 3.8 billion long-term unsecured shareholder loan from Sun Hung Kai Properties, the ratio was 170%[32] - The adjusted debt ratio, considering the fair value of completed data centers, would significantly reduce to 42% and 28% with and without shareholder loans, respectively[33] - The financing costs increased by 33% year-on-year to HKD 30 million, primarily due to higher loan levels[29] - The group successfully secured a HKD 3 billion 5-year term loan and revolving loan financing in November 2021 to fund multiple data center projects[32] Shareholder and Dividend Information - The company plans to distribute a final dividend of HKD 0.208 per share, subject to approval at the annual general meeting[17] - The company proposed a final dividend of HKD 0.208 per share for the year ended June 30, 2022, an increase from HKD 0.194 per share in 2021, totaling HKD 0.208 for the full year[61] - The board of directors emphasized a stable dividend policy, contingent on the group's financial performance, capital needs, and overall economic conditions[61] Corporate Governance and Management - The board of directors is responsible for the overall leadership and strategic direction of the company, ensuring compliance with corporate governance standards[130] - The company emphasizes high business ethics and corporate governance standards as a key objective to enhance shareholder value[128] - The board consists of 17 members, including 2 female directors, representing approximately 12% of the board[132] - The company aims to increase the proportion of female members on the board when suitable candidates are available[132] - The company has established formal service agreements for executive and non-executive directors, ensuring clarity in their roles and responsibilities[134] - The company has mechanisms in place to ensure the board receives independent viewpoints, enhancing the board's independence and decision-making[133] - The company has a code of conduct that outlines standards for employees to perform their duties with honesty and integrity[159] Risk Management - The company has implemented a risk management policy to effectively identify, assess, mitigate, report, and monitor key business risks across all business units[153] - The risk management committee identifies risks that could adversely affect the achievement of business objectives at least once a year[153] - The ongoing COVID-19 pandemic poses a risk of operational disruptions, particularly if there are strict lockdowns affecting data center operations and staff availability[154] - The political instability from the US-China trade war is creating uncertainty for the company's clients and future business prospects[154] Employee and Director Compensation - The company reported a director's remuneration of HKD 52,500 for the position of Vice Chairman and committee member as of the fiscal year ending June 30, 2022[37] - The CEO's total compensation, including basic salary, bonuses, and retirement benefits, amounted to approximately HKD 8,908,000 for the fiscal year ending June 30, 2022[38] - The company has a discretionary bonus system that considers overall group performance and individual contributions when determining bonuses[94] - The company provides medical, provident fund, and vacation benefits to ensure basic needs for employees[93] Shareholder Transactions and Interests - The company engaged in several transactions with Sun Hung Kai Properties and its affiliates during the year, with certain directors abstaining from voting to avoid conflicts of interest[70] - The company has identified significant related party transactions during the fiscal year, which are disclosed in the financial statements[101] - Major shareholders include Sunco Resources Limited and HSBC Trustee (C.I.) Limited, holding 1,719,427,500 shares each, representing approximately 147.02% and 147.11% of the issued share capital respectively[99][100]