Financial Performance - The total EBITDA for 2023 reached HKD 104,880 million, with Europe contributing HKD 231,679 million, accounting for 21% of the total [12]. - The total EBIT for 2023 was HKD 58,568 million, with Europe contributing HKD 25,241 million, representing 32% of the total EBIT [14]. - Total revenue for the company reached HKD 461,558 million, a 1% increase from HKD 457,229 million in the previous year [16]. - EBITDA decreased by 10% to HKD 127,309 million, down from HKD 142,132 million year-over-year [16]. - EBIT totalled HKD 62,770 million, reflecting a 20% decline compared to HKD 78,261 million in the previous year [16]. - The company reported a net profit of HKD 30,179 million, a 31% decrease from HKD 43,683 million year-over-year [16]. - The company’s basic earnings per share fell by 36% to HKD 23,500 from HKD 36,680 in the previous year [16]. - The company reported a pre-tax profit of HKD 38,570 million, down 36% from HKD 59,863 million in the previous year [39]. - The company reported a significant increase in revenue, achieving a total of $X billion, representing a Y% growth compared to the previous year [179]. Market Segments - The retail division operates over 16,400 stores in 28 markets, making it the largest international health and beauty retailer globally [9]. - Retail segment revenue grew by 8% to HKD 183,344 million, accounting for 40% of total revenue [16]. - The telecommunications segment, CK Hutchison Group Telecom, saw a 25% drop in EBITDA to HKD 29,081 million [16]. - The infrastructure segment's revenue remained stable with a 1% increase to HKD 54,714 million [16]. - The retail division operated 16,491 stores across 28 markets by the end of December 2023, a 2% increase from last year [26]. - The health and beauty products segment accounted for 87% of the retail division's revenue, with local currency sales increasing by 12% year-on-year due to a significant 10% growth in same-store sales [26]. - The retail segment reported revenue of HKD 183,344 million, an 8% increase from HKD 169,645 million in 2022 [40]. - The total revenue for health and beauty products reached HKD 160,217 million in 2023, reflecting a 12% increase compared to HKD 142,479 million in 2022 [61]. Sustainability and Environmental Commitment - The group's commitment to environmental and social sustainability is reflected in its adoption of new technologies and solutions [7]. - The company plans to achieve a 54.6% reduction in Scope 1 and 2 emissions and a 32.5% reduction in Scope 3 emissions by 2033, with a goal of net-zero emissions by 2050 [25]. - The company strengthened its sustainability commitment by supplying over 9,000 sustainable products [20]. - CKHGT aims to reduce Scope 1 and 2 emissions by 50% and Scope 3 emissions by 42% by 2030 compared to the 2020 baseline [31]. - The infrastructure division aims to reduce Scope 1 and 2 emissions by 50.4% by 2030 compared to 2018 levels, having already achieved a reduction of approximately 167,000 tons of CO2 in 2023 [27]. Operational Highlights - The port department handled a total throughput of 82.1 million TEUs in 2023, with operations in 53 ports across 24 countries [8]. - The port and related services department handled 82.1 million TEUs in 2023, a 3% decrease from 2022, but showed a 9% growth in the second half compared to the first half of 2023 [24]. - The company introduced 100 autonomous electric trailers at its UK port to enhance efficiency and operational consistency [42]. - The company opened its 1,000th Watsons store in Manila, increasing the total number of stores across Asia, Europe, and the Middle East to over 8,000 [20]. - The company plans to continue expanding its retail presence, with Watsons operating over 4,700 stores across multiple countries [56]. Financial Position and Debt Management - The net debt to total equity ratio stood at 16.2% for 2023, slightly up from 16.1% in 2022 [18]. - The group has a total net debt of HKD 131.81 billion, with 46% and 3% of the debt denominated in Euro and GBP, respectively [125]. - The group maintained a strong financial position with cash and cash equivalents accounting for 89% of current assets as of December 31, 2023 [129]. - The weighted average cost of debt increased to 3.2% in 2023 from 2.0% in 2022 [132]. - The group has sufficient cash and liquid investments to cover all debts maturing before December 31, 2026, and 55% of debts maturing in 2027 [136]. Strategic Initiatives and Future Outlook - The company is optimistic about demand growth in 2024, particularly in regions like India, the Middle East, Africa, and South America [25]. - The company plans to expand its market presence and invest in new technologies to drive future growth [90]. - The company is committed to sustainability initiatives, allocating $J million towards eco-friendly practices, aiming for a K% reduction in carbon footprint [187]. - The overall market outlook remains positive, with analysts projecting a growth rate of L% for the industry in the coming year [188]. - The company is actively involved in various committees, including remuneration and governance, to ensure compliance and strategic direction [186]. Governance and Leadership - The company reported a significant leadership transition, with Li Ka-shing appointed as Chairman and Executive Director effective April 1, 2024 [165]. - The company has a strong governance structure, with multiple directors holding key positions across various subsidiaries and affiliated companies, enhancing oversight and strategic direction [166]. - The management team collectively possesses over 40 years of experience in various industries, contributing to robust operational and financial management capabilities [168]. - The board includes members with extensive academic qualifications and professional certifications, reinforcing the company's commitment to high standards of governance and expertise [169]. - The company continues to expand its board with new appointments, enhancing governance and oversight [186].

Financial Performance - Total revenue for the year ended December 31, 2023, was HKD 461,558 million, a 1% increase from HKD 457,229 million in 2022[2]. - EBITDA for the same period decreased to HKD 127,309 million from HKD 142,132 million, representing a decline of 10.4%[2]. - Reported profit attributable to shareholders was HKD 23,500 million, down 9% from HKD 25,741 million in 2022, with earnings per share decreasing from HKD 6.72 to HKD 6.14[2][6]. - The company did not record any one-off gains in 2023, contrasting with a significant one-off gain in 2022, which impacted the year-on-year profit comparison[5]. - The cash flow from operations decreased by less than 5%, while free cash flow increased by 12% year-on-year[5]. - The total revenue for 2023 reached HKD 461,558 million, a 1% increase from HKD 457,229 million in 2022[36]. - Net profit attributable to ordinary shareholders fell by 36% to HKD 23,500 million compared to HKD 36,680 million in 2022[36]. - The company reported a significant decline in EBIT for CK Hutchison Group Telecom, dropping 82% to HKD 2,265 million[38]. - The company reported a pre-tax profit of HKD 33,212 million for 2023, down from HKD 51,933 million in 2022, a decrease of about 36.2%[134]. Segment Performance - The port and related services segment handled 82.1 million TEUs, a 3% decrease from 2022, but showed a 9% increase in the second half of 2023 compared to the first half[9]. - The total revenue for the port services segment was HKD 40,851 million, down 7% from the previous year, with EBITDA and EBIT decreasing by 14% and 18%, respectively[9]. - For the retail sector, total revenue reached HKD 183.34 billion, with EBITDA and EBIT increasing by 13% and 17% year-on-year, respectively[12]. - The health and beauty products segment accounted for 87% of retail revenue, with local currency sales growing by 12% and EBITDA and EBIT increasing by 15% and 18% respectively[13]. - CK Hutchison Group Telecom reported revenue of HKD 86.81 billion, a 4% increase year-on-year, while EBITDA and EBIT decreased by 31% and 82% respectively due to the impact of one-time gains in 2022[20]. - The infrastructure sector recorded a net profit attributable to shareholders of HKD 8.027 billion, with a 12% year-on-year increase when excluding one-time gains from 2022[17]. Dividends and Shareholder Returns - The board proposed a final dividend of HKD 1.775 per share, a decrease of 14.9% from HKD 2.086 in 2022, leading to a total annual dividend of HKD 2.531, down 13.5%[7]. - The company paid dividends of HKD 2,896 million for 2023, compared to HKD 3,221 million for 2022, reflecting a decrease of about 10.1%[73]. Environmental and Sustainability Initiatives - The retail sector aims to reduce Scope 1 and 2 emissions by 50.4% by 2030 compared to 2018 levels, with a 26% reduction achieved in 2023[14]. - The company aims to achieve net-zero emissions by 2050, with a focus on electrification and clean energy for new investments[10]. - In 2023, the company reduced Scope 1 and 2 emissions by approximately 740,000 tons of CO2, achieving 18% of its established reduction target[18]. - The company aims to reduce Scope 1 and 2 emissions by 50% by 2030 compared to a 2020 baseline, achieving an 80% reduction in 2023[22]. - The group is committed to sustainable investments, including low-carbon technologies and 5G transformation initiatives[31]. Cash Flow and Financial Position - Total cash and cash equivalents amounted to HKD 143.19 billion, with total debt at HKD 274.99 billion, resulting in a net debt to total equity ratio of 16.1%[28]. - The company reported a net cash outflow from investment activities of HKD 17,430 million in 2023, compared to HKD 4,513 million in 2022, indicating a significant increase in cash used for investments[139]. - The company incurred a cash outflow of HKD 46,784 million for financing activities in 2023, compared to HKD 67,406 million in 2022, a decrease of 30.6%[139]. - The company’s operating cash flow before interest and tax was HKD 9,669 million, compared to HKD 73,897 million in the previous year[76]. Impairments and Asset Valuation - The company recognized a non-cash impairment of HKD 110,390 million related to its Italian telecom business[39]. - The impairment loss related to Wind Tre was HKD 11,039 million, impacting the overall EBIT and EBITDA figures[128]. - The company conducted impairment assessments for associates and joint ventures when there were indications of impairment, which involved significant judgment to estimate the recoverable value of investments[49]. Auditor and Compliance - The auditor's report concluded that there were no significant uncertainties regarding the company's ability to continue as a going concern[61]. - The auditor identified and assessed risks of material misstatement due to fraud or error and designed audit procedures to address these risks[57]. - The company is responsible for preparing financial statements that are true and fair, and for internal controls to prevent material misstatements due to fraud or error[54]. Capital Expenditures and Investments - Capital expenditures for 2023 totaled HKD 25,301 million, compared to HKD 25,852 million in 2022, indicating a decrease of about 2.1%[107]. - The company made capital expenditures of HKD 21,670 million in 2023, down from HKD 23,885 million in 2022, a reduction of 9.2%[139]. Joint Ventures and Partnerships - The total revenue from joint ventures for 2023 is HKD 304,130 million, down from HKD 403,798 million in 2022, representing a decline of about 24.7%[190]. - The EBITDA from joint ventures for 2023 is HKD 60,278 million, a decrease from HKD 84,536 million in 2022, reflecting a decline of approximately 28.7%[190]. - The group received dividends from joint ventures amounting to HKD 964 million in 2023, compared to HKD 866 million in 2022, showing an increase of 11.3%[190].

A pedestrian walks past a Vodafone store in central London on May 16, 2023. British mobile giant Vodafone is to axe 11,000 jobs over three years in the latest cull to hit the tech sector, as new boss Margherita Della Valle slammed recent performance.Britain's competition watchdog on Friday said it is opening an investigation into the proposed merger between Vodafone and the Three UK mobile network owned by CK Hutchison.This is a breaking news story. Please check back for more. ...

Revenue Performance - Total revenue for the first half of 2023 was HKD 223,867 million, a decrease of 3% compared to HKD 229,616 million in the same period of 2022[9]. - Retail segment revenue increased by 4% to HKD 88,619 million, up from HKD 84,905 million year-on-year[9]. - The telecommunications segment reported revenue of HKD 41,761 million, a slight decrease from HKD 41,817 million, maintaining a stable market presence[9]. - The infrastructure segment's revenue remained stable at HKD 27,540 million, consistent with the previous year's performance[9]. - Port and related services revenue decreased by 12% to HKD 19,863 million, accounting for 9% of total revenue[13]. - The retail segment's total revenue for the first half of 2023 was HKD 88.619 billion, representing a 4% increase year-on-year, driven by strong performance in Europe and Asia[19]. - The financial and investment segment generated revenue of HKD 40,309 million, representing 18% of total revenue, compared to HKD 46,804 million in the previous year[138]. - Revenue from the retail segment was HKD 65,165 million, with a minor increase from HKD 65,136 million[124]. Profitability Metrics - EBITDA for the first half of 2023 was HKD 61,151 million, down 13% from HKD 70,525 million in the previous year[9]. - EBIT decreased by 21% to HKD 29,613 million, compared to HKD 37,648 million in the same period last year[9]. - Profit attributable to ordinary shareholders was HKD 11,208 million, a decline of 41% from HKD 19,088 million in the prior year[9]. - Reported profit for the six months was HKD 11,009 million, a decline of 38% from HKD 17,740 million in the previous year[14]. - The company reported a significant drop in EBITDA from the telecommunications segment, which fell by 16% to HKD 13,357 million from HKD 15,947 million[9]. - The company’s EBIT for the six months ended June 30, 2023, was HKD 12,181 million, a decrease from HKD 15,857 million in the same period of 2022, representing a 23% decline[141]. Operational Efficiency - The retail segment's EBITDA increased by 9% to HKD 11,771 million, reflecting strong consumer demand and operational efficiency improvements[9]. - EBITDA margin for the retail segment improved to 14% from 10% year-on-year, reflecting a 17% increase in EBITDA to HKD 7,056 million[14]. - The company anticipates continued challenges in the market, particularly in the telecommunications sector, impacting future earnings guidance[9]. - The company aims to reduce Scope 1 and 2 emissions by 46.2% by 2032 compared to the 2021 baseline as part of its new decarbonization strategy[18]. Market Outlook - Future outlook remains cautious due to market conditions, with a focus on operational efficiency and cost management strategies[13]. - The company expects a moderate recovery in freight volumes in the fourth quarter of 2023 as inventory backlogs decrease, despite ongoing challenges in the logistics sector[18]. - The group anticipates ongoing economic challenges, including persistent inflation and a tightening credit environment, which may affect consumer and business confidence[30]. Debt and Financial Management - Interest expenses increased by 24% to HKD (9,757) million, compared to HKD (7,872) million in the prior period[14]. - The group's total cash and liquid investments amounted to HKD 146.73 billion, while total bank and other debts reached HKD 285.92 billion, resulting in a net debt of HKD 139.19 billion, up from HKD 133.19 billion at the end of 2022[28]. - The net debt to total net capital ratio increased to 17.0% from 16.7% at the end of 2022[28]. - The weighted average cost of debt for the group was 2.9% as of June 30, 2023, compared to 1.8% in the previous year[65]. - The company continues to focus on financial risk management to mitigate the impact of interest rate and exchange rate fluctuations on its overall financial position[66]. Shareholder Information - The company declared an interim dividend of HKD 0.756 per share, a decrease of 10% from HKD 0.840 per share in the previous year[14]. - The company reported a total of 1,162,632,010 shares held by Li Ka-Shing as a trust beneficiary, representing approximately 30.4390% of the total shares[90]. - The company emphasizes effective corporate governance as a fundamental element to enhance shareholder value and protect the interests of stakeholders[105]. - The company maintains a high level of corporate governance standards, including effective risk management and internal control systems[105]. Sustainability Initiatives - The infrastructure division aims to reduce emissions by 50% by 2035 compared to 2020 levels and achieve net-zero emissions by 2050[22]. - The group has launched a device recycling program in Ireland, allowing the public to return electronic devices for recycling rewards[29]. - The company has established trusts that hold significant shares, indicating a structured approach to share ownership and control[92]. Customer Metrics - The total number of active customers for the European 3 Group reached 39.9 million, a 2% increase year-on-year, driven by a 7% increase in the UK customer base[24]. - The active customer base for Hutchison Asia Telecom increased by 6% year-on-year, totaling approximately 122.5 million as of June 30, 2023[26]. - The number of loyalty members in the health and beauty segment increased to 150 million, with a sales participation rate of 64%[37].

[Chairman's Statement](index=1&type=section&id=Chairman%27s%20Statement) [Performance Overview and Dividends](index=2&type=section&id=Performance%20Overview%20and%20Dividends) In the first half of 2023, the Group faced challenges including a strong US dollar and rising production costs amidst global economic slowdown, inflation, and geopolitical instability, resulting in a profit decline compared to 2022 which included one-off gains 2023 First Half Key Financial Indicators (Pre-IFRS 16) | Indicator | 2023 First Half (HKD million) | 2022 First Half (HKD million) | Change (Reported Currency) | Change (Local Currency) | | :--- | :--- | :--- | :--- | :--- | | **EBITDA** | 49,933 | 58,244 | -14% | -11% (Excluding one-off items -3%) | | **EBIT** | 27,467 | 34,515 | -20% | -18% (Excluding one-off items -4%) | | **Profit Attributable to Ordinary Shareholders** | 11,009 | 17,740 | -38% | -36% | | **Underlying Profit Attributable to Ordinary Shareholders** | 11,009 | 12,602 | -13% | -10% | - The Board declared an interim dividend of **HKD 0.756 per share** for 2023, a 10% decrease from HKD 0.840 per share in the same period of 2022[2](index=2&type=chunk)[4](index=4&type=chunk) - Key challenges faced by the Group include a persistently strong US dollar, rising production costs (especially energy-intensive telecom businesses in Europe and the UK), and the absence of one-off gains in the current period[3](index=3&type=chunk) [Performance by Business Segment](index=3&type=section&id=Performance%20by%20Business%20Segment) Business segment performance varied, with strong retail recovery in Europe and Asia, declining port throughput, slight infrastructure profit reduction due to interest rates and exchange rates, and significant telecom profit decline due to cost increases and prior-year one-off gains - Ports business: Throughput decreased by **7%** year-on-year, with total revenue, EBITDA, and EBIT declining by **12%**, **20%**, and **27%** respectively, primarily due to lower export cargo volumes and reduced storage income[5](index=5&type=chunk) - Retail business: In local currency, total revenue, EBITDA, and EBIT grew by **7%**, **20%**, and **28%** respectively, driven by strong recovery in European and Asian operations[6](index=6&type=chunk) - 3 Group Europe: EBITDA decreased by **10%** year-on-year in local currency, mainly due to new tower service fees in the UK, higher energy costs, and other inflationary pressures[10](index=10&type=chunk) - Hutchison Telecommunications Asia: EBITDA significantly decreased by **75%** year-on-year, primarily due to a one-off net gain of **HKD 5.1 billion** from the merger of Indonesian operations recorded in the same period of 2022[12](index=12&type=chunk) - Finance & Investments: Contribution from Cenovus Energy decreased due to lower commodity prices, partially offset by gains from non-core asset disposals and treasury income[13](index=13&type=chunk) [Sustainability](index=9&type=section&id=Sustainability) The Group released its fourth Sustainability Report, setting its first group-wide emission reduction targets to halve Scope 1 and 2 emissions by 2035 and achieve net-zero value chain greenhouse gas emissions by 2050 - The Group set its first emission reduction targets: to halve Scope 1 and 2 emissions by **2035** and achieve net-zero value chain emissions by **2050**[14](index=14&type=chunk) - Ports, Retail, and Telecom divisions are committed to Science Based Targets initiative (SBTi), with Retail and CKHGT already validated[14](index=14&type=chunk) - The Group addresses sustainability challenges through innovation and collaboration, such as the Retail division joining the EcoBeautyScore Consortium and 3 Ireland launching a device recycling program[14](index=14&type=chunk) [Outlook](index=10&type=section&id=Outlook) The economic environment is expected to remain challenging in the second half of 2023 with ongoing inflation and growth deceleration risks, though recurring operating performance is anticipated to improve despite the absence of significant one-off gains compared to 2022 - The economic situation in the second half is expected to remain challenging, with risks of persistent inflation and slowing growth[15](index=15&type=chunk) - The Group's full-year operating outlook remains resilient, with downturns in some businesses offset by strong recoveries in others[15](index=15&type=chunk) - Compared to over **HKD 10 billion** in one-off gains recorded in 2022, the Group does not anticipate realizing significant net one-off gains this year[15](index=15&type=chunk) [Financial Performance Summary](index=11&type=section&id=Financial%20Performance%20Summary) [Financial Performance Summary (Post-IFRS 16)](index=11&type=section&id=Financial%20Performance%20Summary%20%28Post-IFRS%2016%29) Under IFRS 16, the Group's total revenue for the first half of 2023 was HKD 223.9 billion, a 3% year-on-year decrease, with EBITDA and EBIT also declining, and profit attributable to ordinary shareholders significantly down by 41% due to high prior-year one-off gains 2023 First Half Financial Performance Summary (Post-IFRS 16, HKD million) | Indicator | 2023 First Half | 2022 First Half | Change % | | :--- | :--- | :--- | :--- | | **Total Revenue** | 223,867 | 229,616 | -3% | | **Total EBITDA** | 61,151 | 70,525 | -13% | | **Total EBIT** | 29,613 | 37,648 | -21% | | **Profit Attributable to Ordinary Shareholders** | 11,208 | 19,088 | -41% | [Financial Performance Summary (Pre-IFRS 16)](index=12&type=section&id=Financial%20Performance%20Summary%20%28Pre-IFRS%2016%29) Based on the management-focused Pre-IFRS 16 basis, the Group's total revenue for the first half of 2023 was HKD 223.9 billion, a 3% year-on-year decrease (1% increase in local currency), with EBITDA, EBIT, and profit attributable to ordinary shareholders all showing declines 2023 First Half Financial Performance Summary (Pre-IFRS 16, HKD million) | Indicator | 2023 First Half | 2022 First Half | Change % | Change % in Local Currency | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | 223,867 | 229,616 | -3% | +1% | | **Total EBITDA** | 49,933 | 58,244 | -14% | -11% | | **Total EBIT** | 27,467 | 34,515 | -20% | -18% | | **Profit Attributable to Ordinary Shareholders** | 11,009 | 17,740 | -38% | -36% | [Operations Review](index=13&type=section&id=Operations%20Review) [Ports and Related Services](index=13&type=section&id=Ports%20and%20Related%20Services) In the first half of 2023, the Ports and Related Services division saw a 7% year-on-year decrease in throughput to 39.3 million TEUs, primarily due to weaker export cargo volumes and global consumer demand, leading to double-digit declines in revenue, EBITDA, and EBIT Ports and Related Services First Half Performance (Pre-IFRS 16) | Indicator | 2023 First Half (HKD million) | 2022 First Half (HKD million) | Change (Local Currency) | | :--- | :--- | :--- | :--- | | **Total Revenue** | 19,863 | 22,651 | -12% | | **EBITDA** | 6,509 | 8,273 | -20% | | **EBIT** | 4,337 | 6,042 | -27% | | **Throughput (million TEUs)** | 39.3 | 42.4 | -7% | - The decline in throughput was mainly due to weak exports from China to Europe and the US, and reduced cargo demand in European ports due to high inflation, partially offset by growth in Shanghai port from a low base in the prior period[20](index=20&type=chunk) - Reduced port congestion led to a general decrease in storage income across major ports, further impacting divisional revenue[20](index=20&type=chunk) [Retail](index=15&type=section&id=Retail) The Retail division demonstrated strong performance in the first half of 2023, with local currency growth of 7% in total revenue, 20% in EBITDA, and 28% in EBIT, primarily driven by the health and beauty segment's 11.3% comparable store sales growth Retail First Half Performance (Pre-IFRS 16) | Indicator | 2023 First Half (HKD million) | 2022 First Half (HKD million) | Change (Local Currency) | | :--- | :--- | :--- | :--- | | **Total Revenue** | 88,619 | 84,905 | +7% | | **EBITDA** | 7,056 | 6,030 | +20% | | **EBIT** | 5,420 | 4,331 | +28% | | **Number of Stores** | 16,164 | 16,244 | -1% | | **Comparable Store Sales Growth** | +7.2% | +7.4% | N/A | - The health and beauty segment was the core of growth, accounting for **97%** of the division's EBITDA, with its local currency EBITDA increasing by **22%**[22](index=22&type=chunk)[23](index=23&type=chunk) - Regional performance: European health and beauty comparable store sales grew by **11.3%**; Asia grew by **16.8%**; Mainland China saw a modest growth of **2.0%**[24](index=24&type=chunk) [Infrastructure](index=17&type=section&id=Infrastructure) The Infrastructure division, primarily comprising interests in Cheung Kong Infrastructure (CKI), maintained stable revenue in the first half of 2023, with a slight 1% EBITDA decrease and 2% EBIT increase, while CKI's profit declined 4% due to interest rates and exchange rates but grew 4% in local currency Infrastructure First Half Performance (Pre-IFRS 16) | Indicator | 2023 First Half (HKD million) | 2022 First Half (HKD million) | Change (Local Currency) | | :--- | :--- | :--- | :--- | | **Total Revenue** | 27,540 | 27,600 | +4% | | **EBITDA** | 14,681 | 14,864 | +4% | | **EBIT** | 10,041 | 9,851 | +7% | - Profit attributable to CKI shareholders was **HKD 4.239 billion**, a **4%** year-on-year decrease, mainly due to increased finance costs and unfavorable foreign exchange movements[27](index=27&type=chunk) - CKI maintains a strong financial position, holding **HKD 12 billion** in cash as of June 30, 2023, with a net debt to net total capital ratio of **9.3%** and an "A/Stable" credit rating[28](index=28&type=chunk) [CK Hutchison Group Telecom](index=18&type=section&id=CK%20Hutchison%20Group%20Telecom) The CKHGT division's first-half revenue remained stable, but EBITDA and EBIT significantly declined by 20% and 86% respectively, primarily due to reduced contributions from 3 Group Europe and adverse foreign currency revaluation CKHGT First Half Performance (Pre-IFRS 16) | Indicator | 2023 First Half (HKD million) | 2022 First Half (HKD million) | Change (Local Currency) | | :--- | :--- | :--- | :--- | | **Total Revenue** | 41,761 | 41,817 | +3% | | **EBITDA** | 10,019 | 12,512 | -18% | | **EBIT** | 335 | 2,474 | -88% | - 3 Group Europe's total active customer base increased by **2%** year-on-year to **39.9 million**, primarily driven by the UK business[10](index=10&type=chunk)[30](index=30&type=chunk) - The decline in 3 Group Europe's EBITDA was mainly due to three factors: new tower service fees in the UK (approximately **HKD 0.6 billion**), increased energy and inflation costs (approximately **HKD 1 billion**), and higher network expansion costs[10](index=10&type=chunk)[30](index=30&type=chunk) - The Group has agreed to merge 3 UK with Vodafone UK (Group holding **49%** stake) and establish a wholesale communications joint venture in Italy (Group holding **40%** stake), both pending regulatory approvals[11](index=11&type=chunk) [Hutchison Telecommunications Asia](index=23&type=section&id=Hutchison%20Telecommunications%20Asia) Hutchison Telecommunications Asia's first-half 2023 performance was severely impacted by one-off items in the prior year, with reported EBITDA and EBIT significantly declining by 75% and 88% respectively, primarily due to a HKD 6.1 billion gain from the Indonesian business merger in 2022 Hutchison Telecommunications Asia First Half Performance (Pre-IFRS 16) | Indicator | 2023 First Half (HKD million) | 2022 First Half (HKD million) | Change (Local Currency) | | :--- | :--- | :--- | :--- | | **Total Revenue** | 5,775 | 5,839 | +3% | | **EBITDA** | 1,877 | 7,572 | -74% | | **EBIT** | 723 | 6,047 | -87% | | **Total Active Customers (million)** | 122.5 | 115.1 | +6% | - The significant decline in performance was primarily due to the inclusion of a **HKD 6.1 billion** gain from the completion of the Indonesian telecom business merger and a non-cash impairment of **HKD 0.962 billion** for the Sri Lankan business in the first half of 2022[45](index=45&type=chunk) - The Indonesian joint venture IOH performed strongly, with total revenue growing by **9.5%** and underlying EBITDA (Post-IFRS 16) increasing by **24%**, driven by customer growth and increased data traffic[45](index=45&type=chunk) [Finance & Investments and Others](index=24&type=section&id=Finance%20%26%20Investments%20and%20Others) This segment performed well, with EBITDA and EBIT growing by 9% and 15% respectively, as gains from non-core asset disposals, higher money market deposit rates, and increased contributions from Hutchison Whampoa China effectively offset reduced contributions from Cenovus Energy Finance & Investments and Others First Half Performance (Pre-IFRS 16) | Indicator | 2023 First Half (HKD million) | 2022 First Half (HKD million) | Change (Local Currency) | | :--- | :--- | :--- | :--- | | **Total Revenue** | 40,309 | 46,804 | -10% | | **EBITDA** | 9,791 | 8,993 | +13% | | **EBIT** | 6,611 | 5,770 | +17% | - The Group's share of Cenovus Energy's EBITDA contribution was **HKD 4.132 billion**, a **47%** year-on-year decrease, primarily due to lower commodity prices and production disruptions[47](index=47&type=chunk) - As of June 30, 2023, the Group held cash and marketable investments totaling **HKD 146.735 billion**, with consolidated net debt of **HKD 139.193 billion**, and a net debt to net total capital ratio of **17.0%**[13](index=13&type=chunk) [Interim Financial Statements](index=25&type=section&id=Interim%20Financial%20Statements) [Independent Auditor's Review Report](index=25&type=section&id=Independent%20Auditor%27s%20Review%20Report) PricewaterhouseCoopers reviewed the Group's interim financial statements for the six months ended June 30, 2023, in accordance with Hong Kong Standard on Review Engagements 2410, finding no material matters suggesting non-compliance with HKAS 34 - PricewaterhouseCoopers, the auditor, issued a review conclusion on the interim financial statements, stating no material issues were found indicating non-compliance with Hong Kong Accounting Standard 34[51](index=51&type=chunk) [Condensed Consolidated Income Statement](index=26&type=section&id=Condensed%20Consolidated%20Income%20Statement) For the six months ended June 30, 2023, the Group's revenue was HKD 133.377 billion, largely flat year-on-year, but profit before tax decreased from HKD 24.810 billion to HKD 15.718 billion due to a significant reduction in other income and gains and increased interest expenses, leading to a 41% decline in profit attributable to ordinary shareholders Condensed Consolidated Income Statement (Unaudited, HKD million) | Indicator | 2023 First Half | 2022 First Half | | :--- | :--- | :--- | | **Revenue** | 133,377 | 131,358 | | **Share of Profits of Associates/Joint Ventures** | 7,800 | 10,783 | | **Profit Before Tax** | 15,718 | 24,810 | | **Profit After Tax** | 14,343 | 22,604 | | **Profit Attributable to Ordinary Shareholders** | 11,208 | 19,088 | | **Earnings Per Share (HKD)** | 2.93 | 4.98 | [Condensed Consolidated Statement of Financial Position](index=28&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2023, the Group's total assets slightly increased to HKD 1,158.834 billion, while total liabilities slightly decreased to HKD 496.548 billion, resulting in an increase in net assets (total equity) to HKD 662.286 billion, with non-current assets, goodwill, and interests in associates and joint ventures being major components Condensed Consolidated Statement of Financial Position Summary (Unaudited, HKD million) | Indicator | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Non-current Assets** | 947,070 | 924,162 | | **Current Assets** | 211,764 | 224,275 | | **Total Assets** | 1,158,834 | 1,148,437 | | **Current Liabilities** | 144,457 | 176,515 | | **Non-current Liabilities** | 352,091 | 324,613 | | **Total Liabilities** | 496,548 | 501,128 | | **Total Equity** | 662,286 | 647,309 | [Condensed Consolidated Cash Flow Statement](index=32&type=section&id=Condensed%20Consolidated%20Cash%20Flow%20Statement) In the first half of 2023, the Group's net cash generated from operating activities was HKD 21.191 billion, lower than the prior year, with net cash used in investing activities of HKD 6.047 billion and net cash used in financing activities of HKD 24.489 billion, leading to a HKD 9.345 billion decrease in cash and cash equivalents, ending the period at HKD 128.740 billion Condensed Consolidated Cash Flow Statement Summary (Unaudited, HKD million) | Indicator | 2023 First Half | 2022 First Half | | :--- | :--- | :--- | | **Net Cash from Operating Activities** | 21,191 | 28,034 | | **Cash Flows Used in Investing Activities** | (6,047) | (14,375) | | **Cash Flows Used in Financing Activities** | (24,489) | (54,477) | | **Decrease in Cash and Cash Equivalents** | (9,345) | (40,818) | | **Cash and Cash Equivalents at End of Period** | 128,740 | 112,315 | [Notes to the Financial Statements](index=34&type=section&id=Notes%20to%20the%20Financial%20Statements) The notes to the financial statements provide detailed explanations and supplementary information on interim financial statement items, covering accounting policies, segment information, asset and liability breakdowns, contingent liabilities, related party transactions, and fair value measurements [Note 5: Operating Segment Information](index=37&type=section&id=Note%205%3A%20Operating%20Segment%20Information) This note details the Group's operating performance by its four core business segments—Ports, Retail, Infrastructure, and Telecom—along with Finance & Investments, showing stable or growing EBITDA contributions from Retail and Infrastructure, while Ports and Telecom faced challenges, particularly Hutchison Telecommunications Asia due to high prior-year one-off gains Segment EBITDA Contribution (Pre-IFRS 16, HKD million) | Segment | 2023 First Half | 2022 First Half | Percentage of Total (2023) | | :--- | :--- | :--- | :--- | | Ports and Related Services | 6,509 | 8,273 | 13% | | Retail | 7,056 | 6,030 | 14% | | Infrastructure | 14,681 | 14,864 | 29% | | CK Hutchison Group Telecom | 10,019 | 12,512 | 20% | | Hutchison Telecommunications Asia | 1,877 | 7,572 | 4% | | Finance & Investments and Others | 9,791 | 8,993 | 20% | | **Total** | **49,933** | **58,244** | **100%** | - The note explains why management presents both Pre- and Post-IFRS 16 data, considering the former more reflective of the Group's underlying operating performance and used for internal decision-making[73](index=73&type=chunk) [Note 24: Bank and Other Debts](index=67&type=section&id=Note%2024%3A%20Bank%20and%20Other%20Debts) As of June 30, 2023, the Group's total principal amount of bank and other debts was HKD 282.3 billion, with HKD 239.2 billion being long-term, primarily consisting of notes and bonds (69%), and a balanced maturity profile over the next five years Total Principal Amount of Bank and Other Debts (HKD million) | Category | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Current Portion** | 43,142 | 70,206 | | **Long-term Portion** | 239,158 | 213,401 | | **Total** | **282,300** | **283,607** | [Note 33: Contingent Liabilities and Guarantees](index=77&type=section&id=Note%2033%3A%20Contingent%20Liabilities%20and%20Guarantees) As of June 30, 2023, the Group provided total guarantees of HKD 4.902 billion for bank and other borrowings of its associates and joint ventures, of which HKD 4.612 billion was utilized, in addition to HKD 5.277 billion in performance and other guarantees - Total guarantees for bank and other borrowings provided to associates and joint ventures amounted to **HKD 4.902 billion**[145](index=145&type=chunk) [Group Capital and Other Information](index=84&type=section&id=Group%20Capital%20and%20Other%20Information) [Treasury, Cash Management and Risk Control](index=84&type=section&id=Treasury%2C%20Cash%20Management%20and%20Risk%20Control) The Group's centralized treasury department manages financial risks to mitigate interest rate and exchange rate fluctuations, avoiding speculative derivative transactions, while maintaining investment-grade credit ratings and utilizing interest rate swaps and local currency borrowings for risk management - Interest Rate Risk: As of June 30, 2023, approximately **30%** of the Group's debt was floating rate and **70%** fixed rate, after accounting for interest rate swaps[165](index=165&type=chunk) - Foreign Exchange Risk: The Group operates in over **50** countries, with major exposures to Euro and Sterling; **47%** of 2023 first-half EBITDA came from Europe (of which **20%** from the UK), and **55%** of consolidated net debt was in Euro, **3%** in Sterling[167](index=167&type=chunk) - Credit Ratings: The Group maintains long-term credit ratings of Moody's **A2**, S&P **A**, and Fitch **A-**, all with a "stable" outlook[169](index=169&type=chunk) [Liquid Assets, Cash Flow and Debt Position](index=86&type=section&id=Liquid%20Assets%2C%20Cash%20Flow%20and%20Debt%20Position) As of June 30, 2023, the Group held HKD 146.7 billion in liquid assets, with 88% in cash and cash equivalents, demonstrating a robust financial position, while maintaining a healthy net debt to total capital ratio of 17.0% despite total debt of HKD 285.9 billion - Total liquid assets amounted to **HKD 146.735 billion**, with cash and cash equivalents accounting for **88%**, US Treasury bills and other listed bonds for **4%**, and listed equity securities for **8%**[171](index=171&type=chunk) - The net debt to net total capital ratio (Pre-IFRS 16) was **17.0%**, largely consistent with **16.7%** at the end of 2022, indicating stable financial leverage[177](index=177&type=chunk) Debt Principal Amount Maturity Distribution (June 30, 2023) | Maturity Period | Percentage | | :--- | :--- | | Remaining 2023 | 10% | | 2024 | 17% | | 2025 | 11% | | 2026 | 12% | | 2027 | 10% | | 2028 and Beyond | 40% | [Other Information](index=89&type=section&id=Other%20Information) As of June 30, 2023, the Group employed 172,622 staff, maintained compliance with all applicable Listing Rules on corporate governance, and had its interim financial statements reviewed by PricewaterhouseCoopers and the Audit Committee, reaffirming its core objective of enhancing long-term shareholder returns - As of June 30, 2023, the Group (including subsidiaries) had a total of **172,622 employees**[180](index=180&type=chunk) - The company complied with the Corporate Governance Code during the reporting period and explained its co-managing director governance structure[181](index=181&type=chunk) - The interim financial statements were reviewed by PricewaterhouseCoopers in accordance with Hong Kong Standard on Review Engagements 2410[183](index=183&type=chunk)

Financial Performance - The total EBITDA for 2022 was reported at HKD 119,010 million, with a basic benchmark of HKD 106,207 million[14]. - The total EBIT for 2022 was reported at HKD 72,864 million, with a basic benchmark of HKD 60,061 million[15]. - Total revenue for 2022 was HKD 457,229 million, representing a 3% increase from HKD 445,383 million in 2021[16]. - EBITDA for 2022 reached HKD 142,132 million, reflecting a 5% growth compared to HKD 135,653 million in 2021[39]. - EBIT totaled HKD 78,261 million in 2022, marking a 14% increase from HKD 68,818 million in the previous year[39]. - The group's net profit attributable to shareholders for 2022 was HKD 9.7 billion, including one-time gains from the sale of UK tower assets and Indonesian telecom business, offset by non-cash goodwill impairment of HKD 12 billion[23]. - The company's profit attributable to ordinary shareholders increased to HKD 36,680 million in 2022, up from HKD 33,484 million in 2021, representing an increase of 6.5%[18]. - Earnings per share (EPS) rose to HKD 9.57 in 2022, compared to HKD 8.70 in 2021, reflecting a growth of 10%[18]. - The group's EBITDA for the year was HKD 119.01 billion, compared to HKD 111.23 billion for the previous year, resulting in an interest coverage ratio of 64.5 times, up from 31.9 times[141]. Revenue Breakdown - Revenue from Europe amounted to HKD 214,888 million, while revenue from Asia, Australia, and others was HKD 74,434 million[13]. - Retail segment revenue decreased by 2% to HKD 169,645 million, down from HKD 173,601 million in the previous year[16]. - The financial and investment segment saw a revenue increase of 31% to HKD 94,085 million from HKD 72,036 million in the previous year[16]. - CK Hutchison Group Telecom revenue decreased by 10% to HKD 83,289 million, down from HKD 92,575 million in 2021[16]. - The infrastructure segment reported a revenue decline of 3% to HKD 54,441 million from HKD 56,100 million in the previous year[16]. - The retail segment generated revenue of HKD 169,645 million, down 2% from HKD 173,601 million in 2021[39]. - The port segment reported total revenue of HKD 44.14 billion, with EBITDA of HKD 15.8 billion and EBIT of HKD 11.43 billion, reflecting increases of 4%, 4%, and 6% respectively in reported currency[26]. Operational Highlights - The port division handled a total throughput of 84.8 million TEUs (twenty-foot equivalent units) in 2022, with interests in 293 operational berths across 51 ports in 25 countries[9]. - The retail division operates over 16,100 stores in 28 markets, making it the largest international health and beauty retailer globally[10]. - The telecommunications division is a pioneer in mobile data communication technology and a leading operator in integrated telecommunications and digital services[12]. - The company is involved in the manufacturing and distribution of bottled water and beverages in Hong Kong and mainland China[10]. - The company processed 84.8 million twenty-foot equivalent units (TEUs) in 2022, maintaining a strong position in six of the world's ten busiest container ports[43]. - The company plans to invest in new world-class container terminals in Egypt to enhance capacity and support future growth[26]. - The company plans to continue expanding its market presence and investing in new technologies to enhance its service offerings[12]. Strategic Initiatives - The company is actively pursuing strategic acquisitions to bolster its infrastructure and telecommunications capabilities[11]. - The company plans to expand its presence in the Middle East by opening 12 new stores in Saudi Arabia, Qatar, and the UAE[20]. - The company has received approval for the commercial listing of its products in Macau, enhancing its market reach[20]. - The company is collaborating with Cellnex to develop a new AI tumor vaccine research platform, aiming to enhance vaccine exploration and design capabilities[21]. - The company announced a collaboration with Terminal Investment Limited Sàrl to develop a new container terminal in Europahaven, Netherlands[41]. - The company is collaborating with HaloSep AB to assess the feasibility of hazardous gas purification in Rotterdam, Netherlands[75]. Market Challenges - The telecommunications business is expected to recover in 2023 as COVID-19 restrictions are lifted and borders reopen, increasing foot traffic[22]. - External factors such as inflation, energy prices, and geopolitical risks are expected to create uncertainty for the group's business in 2023[36]. - The ongoing COVID-19 pandemic remains a significant uncertainty, potentially affecting the group's operations, particularly in port and retail services[147]. - The group faces significant risks due to the ongoing COVID-19 pandemic, which may lead to reduced business operations and cash flow, impacting financial performance[148]. - The group cannot guarantee that new investments will further increase customer numbers and operational gross profit, which may adversely affect its financial condition and operational performance[156]. Governance and Management - The company has appointed several experienced directors, including Ye Dequan, who has been with the company since December 2014, and has extensive experience in various subsidiaries[174]. - The company reported a significant management team with over 35 years of experience in different industries, including finance and operations[176]. - The board includes independent directors with legal and corporate governance expertise, enhancing the company's compliance and regulatory framework[177]. - The company has a robust governance structure, with independent directors overseeing various subsidiaries and ensuring accountability[178]. - The company emphasizes the importance of legal and regulatory compliance, as evidenced by the qualifications of its directors in law and corporate governance[181]. Shareholding Structure - Li Ka-Shing holds a total of 1,161,272,710 shares, representing approximately 30.43% of the company's total issued shares as of December 31, 2022[193]. - The company has a total of 3,830,044,500 issued shares, which is the basis for calculating the percentage of shareholdings[194]. - The shareholding of Ho Kwan Ning is 6,011,438 shares, accounting for 0.16% of the total issued shares[192]. - The shareholding of Mak Lee Sze is 833,868 shares, which is approximately 0.02% of the total issued shares[192]. - The shareholding of Fok Yat Choi is 7,380,860 shares, representing about 0.19% of the total issued shares[192]. - The company has a diverse range of shareholders, including family and trust entities, indicating a complex ownership structure[193].

Conference Call Participants Operator Good afternoon. Welcome to the live webcast of CK Hutchison 2022 Final Results Presentation. Today, our speakers are Mr. Victor Li, our Chairman and Group Co-Managing Director; Mr. Canning Fok, Group CoManaging Director; Mr. Frank Sixt, Group Finance Director and Deputy Managing Director; Mr. Dominic Lai, Deputy Managing Director of CK Hutchison and Group Managing Director of A.S. Watson Group; and Malina Ngai, CEO of Asia and Europe of A.S. Watson and Group COO of A.S. ...

Financial Performance - Total revenue for the year ended December 31, 2022, was HKD 457,229 million, an increase from HKD 445,383 million in 2021, representing a growth of approximately 2%[2] - EBITDA for the same period was HKD 142,132 million, up from HKD 135,653 million in 2021, reflecting a growth of about 5%[2] - Reported profit attributable to shareholders was HKD 36,680 million, compared to HKD 33,484 million in 2021, marking a 10% increase[2] - Basic earnings per share for 2022 was HKD 9.57, an increase of 10% from HKD 8.70 in 2021[5] - The group reported a net profit of HKD 34,869 million for 2022, compared to HKD 33,500 million in 2021[60] - The company reported a significant increase in deferred tax expenses, which rose by 243% to HKD 6,670 million[19] - The total tax expense for 2022 was HKD 8,274 million, significantly higher than HKD 2,230 million in 2021[100] Dividends - The board proposed a final dividend of HKD 2.086 per share, up 12% from HKD 1.860 in the previous year, leading to a total annual dividend of HKD 2.926 per share, a 10% increase from HKD 2.660 in 2021[2][6] - The company made a cash payment of HKD 10,353 million in dividends to ordinary shareholders in 2022, compared to HKD 9,627 million in 2021, reflecting an increase of about 7.5%[87] Segment Performance - The retail department operated 16,142 stores across 28 markets at the end of 2022, a 2% decrease from the previous year, with total revenue of HKD 169.64 billion, EBITDA of HKD 14.39 billion, and EBIT of HKD 11.04 billion, reflecting decreases of 2%, 11%, and 11% respectively in reported currency[8] - CK Hutchison Group Telecom reported revenue of HKD 83.29 billion, a 10% decrease from 2021, with EBITDA of HKD 32.19 billion and EBIT of HKD 12.83 billion, reflecting decreases of 25% and 45% respectively in reported currency[11] - The infrastructure department's contribution showed a 3% increase in net profit attributable to shareholders, amounting to HKD 7.748 billion, despite rising financial costs due to interest rate increases[10] - The telecommunications segment in Europe generated HKD 23,864 million, down 20% from HKD 29,892 million in 2021[60] Asset and Liability Management - Total assets decreased from HKD 1,032,113 million in 2021 to HKD 971,922 million in 2022, representing a decline of approximately 5.9%[33] - The company's total liabilities decreased to HKD 272,302 million from HKD 320,903 million in 2021, reflecting a decline of approximately 15.1%[86] - The net debt to total capital ratio improved to 16.7% from 20.3% year-over-year, reflecting a stronger financial position[15] Impairments and Gains - The company recorded a net gain of HKD 9,700 million from one-off items, including HKD 15,800 million from the sale of UK tower assets and HKD 6,100 million from the merger with Indonesian telecommunications, offset by HKD 12,000 million in non-cash goodwill impairment[4] - The company recognized a loss of $2,061 million from the translation of foreign subsidiaries, compared to a loss of $10,567 million in 2021, reflecting an improvement[32] - The company reported a significant impairment of goodwill related to Wind Tre amounting to HKD 11,039 million[72] Future Outlook - The company anticipates recovery in its mainland retail operations in 2023 following the easing of COVID-19 restrictions and border reopening[3] - The group anticipates challenges in 2023 due to external factors such as potential inflation and geopolitical risks[17] - The company plans to focus on market expansion and new product development in the upcoming fiscal year[19] Operational Efficiency - The company aims to enhance operational efficiency and explore potential mergers and acquisitions to drive growth[60] - The company continues to focus on expanding its telecommunications operations in Asia, particularly through mergers and acquisitions[79] Director Remuneration - The total director remuneration for 2022 was HKD 537 million, an increase from HKD 500 million in 2021, representing a growth of 7.4%[89] - The total remuneration for the directors from the company and its subsidiaries was HKD 537.01 million for 2022, with a breakdown of HKD 5.35 million in basic salary, HKD 46.86 million in allowances, and HKD 482.13 million in benefits[90]

Revenue Performance - Total revenue for the six months ended June 30, 2022, was HKD 229,616 million, with Europe contributing HKD 107,397 million, representing a 6% increase [3]. - Revenue from Mainland China was HKD 17,760 million, showing a 20% increase [3]. - Revenue from Hong Kong reached HKD 18,973 million, accounting for 8% of total revenue [3]. - The Asia, Australia, and other regions generated HKD 36,925 million, contributing 16% to total revenue [3]. - Total revenue for the first half of 2022 reached HKD 229,616 million, an increase of 8% compared to HKD 212,386 million in the same period of 2021 [7]. - Total revenue for the six months ended June 30, 2022, was HKD 229,616 million, an increase of 8% from HKD 212,386 million in the same period of 2021 [11]. - Total revenue for the first half of 2022 was HKD 39,407 million, a decrease of 9% compared to HKD 43,160 million in the first half of 2021 [47]. - Total revenue for the six months ended June 30, 2022, was HKD 131,358 million, a decrease from HKD 135,496 million in the same period of 2021, representing a decline of approximately 2.1% [127]. EBITDA and EBIT - EBITDA for the same period was reported at HKD 58,244 million, with a basic benchmark of HKD 53,106 million [4]. - EBIT for the six months ended June 30, 2022, was HKD 34,515 million, with a basic benchmark of HKD 29,377 million [6]. - EBITDA for the first half of 2022 was HKD 70,525 million, reflecting a 3% growth from HKD 68,167 million in the previous year [7]. - The EBIT for the first half of 2022 amounted to HKD 37,648 million, an increase of 8% from HKD 34,809 million in the same period of 2021 [7]. - EBITDA for the same period was HKD 58,244 million, up 5% from HKD 55,590 million year-on-year [12]. - EBIT totaled HKD 34,515 million, reflecting a 5% increase compared to HKD 32,773 million in the previous year [12]. - EBITDA for the first half of 2022 was HKD 58.24 billion, up from HKD 55.59 billion in the same period of 2021 [90]. - The company’s EBITDA margin for the first half of 2022 was approximately 46% compared to 100% in the previous year, indicating a shift in profitability [160]. Profit and Net Income - The net profit attributable to ordinary shareholders was HKD 19,088 million, a 4% increase from HKD 18,300 million in the previous year [7]. - The reported profit attributable to shareholders was HKD 17,740 million, a decrease of 4% from HKD 18,443 million in 2021 [12]. - The company reported a profit of HKD 19,088 million for the six months ended June 30, 2022 [132]. - The profit attributable to ordinary shareholders was HKD 19,088 million, up from HKD 18,300 million in 2021, reflecting a growth of approximately 4.3% [127]. - The company reported a net profit of $2.898 billion for the six months ended June 30, 2022, compared to $2.641 billion in the same period of 2021, representing an increase of approximately 9.8% [130]. Segment Performance - The port and related services segment generated revenue of HKD 22,651 million, up 14% from HKD 19,933 million in the previous year [7]. - Retail infrastructure revenue increased by 3% to HKD 84,905 million, compared to HKD 82,621 million in the same period of 2021 [7]. - CK Hutchison Group Telecom reported a revenue decline of 9% to HKD 41,817 million, down from HKD 45,826 million in the previous year [7]. - The financial and investment segment revenue surged by 47% to HKD 46,804 million, compared to HKD 31,858 million in the same period of 2021 [7]. - The telecommunications segment, CK Hutchison Group Telecom, reported revenue of HKD 41,817 million, down 9% from HKD 45,826 million in 2021 [11]. - The port division is implementing a decarbonization plan to achieve net-zero emissions, including upgrading existing infrastructure [15]. - The retail segment operated 16,244 stores across 28 markets as of June 30, 2022, reflecting a 1% decrease from the end of 2021 [16]. Market Strategy and Outlook - The company is focusing on market expansion and new product development as part of its growth strategy [2]. - Future outlook includes continued investment in technology and potential acquisitions to enhance market presence [2]. - The company is expanding its logistics business and aims to diversify revenue sources through strategic partnerships [15]. - The company plans to continue expanding its market presence and investing in new technologies to drive future growth [170]. - The company continues to face challenges from currency fluctuations and inflationary pressures, particularly in Europe [14]. - The outlook for the global economy remains cautious due to inflation and growth slowdown, but the group expects to maintain stable growth in the second half of the year [29]. Financial Position and Capital Management - The group's total cash and liquid investments reached HKD 119.91 billion, while total bank and other debts amounted to HKD 288.38 billion, resulting in a net debt of HKD 168.39 billion, with a net debt to total equity ratio of 20.5% [27]. - The group aims to reduce its net debt to total equity ratio to 17.5% following the completion of the UK tower transaction in August 2022 [27]. - The group's interest expenses and financing costs for the first half of 2022 amounted to HKD 7.87 billion, a 9% increase year-on-year [69]. - The weighted average cost of debt for the group was 1.8% as of June 30, 2022, compared to 1.6% in the previous year [69]. - The company aims to enhance long-term returns for stakeholders through sustainable profit and cash flow growth, focusing on capital management and strategic alliances in technology sectors [99]. Shareholder Information - The company declared an interim dividend of HKD 0.84 per share, a 5% increase from HKD 0.80 per share in the previous year [11]. - As of June 30, 2022, the total number of shares held by Li Ka-Shing is 1,165,421,760, representing approximately 30.39% of the company's equity [101]. - The report indicates that the actual performance may differ significantly from the forward-looking statements due to risks and uncertainties [100]. - The company has a diverse range of equity interests among its directors, with various family and personal holdings detailed in the report [101]. Risks and Compliance - The report emphasizes the importance of understanding the risks associated with forward-looking statements and the potential for significant deviations from expected performance [100]. - The company maintained compliance with the corporate governance code as per the Hong Kong Stock Exchange regulations [121]. - The board of directors has adopted a standard code for securities transactions, ensuring compliance during the reporting period [122].

Financial Data and Key Metrics Changes - The company's net earnings for the first half of the year reached HKD19.1 billion, with earnings per share increasing by 5% to $4.98 [3] - Revenue increased by 8% to HKD222.6 billion, with a 13% increase in local currencies [5] - EBITDA was reported at HKD58.2 billion, reflecting a 5% growth, while operating cash flow decreased to HKD16 billion from HKD17.7 billion in the previous year [6][19] - The net debt stood at HKD168.4 billion, resulting in a gearing ratio of 20.5%, which is expected to decrease to 17.5% with incoming cash [4][34] Business Line Data and Key Metrics Changes - The ports division saw a 16% increase in EBITDA, driven by higher storage income due to port congestion [9][38] - Retail reported an EBITDA of HKD6.03 billion, a decrease of 10% in reported currency, primarily due to challenges in Health and Beauty China [49][57] - Infrastructure earnings increased by 46% to HKD4.4 billion, with stable contributions across most units [60] - The telecom division experienced a 21% drop in EBITDA to HKD11 billion, largely due to a significant decline in Italy [67][70] Market Data and Key Metrics Changes - The European and U.K. markets contributed 49% to the overall EBITDA, with the U.K. alone accounting for 21% [8] - The Asia, Australia, and North America regions contributed 29%, while Hong Kong and China contributed 23% and 6%, respectively [8] - The retail division's sales in China dropped by 17% year-on-year due to COVID-related lockdowns, impacting footfall by 30% [51][52] Company Strategy and Development Direction - The company emphasizes in-market consolidation and network sharing as key strategies to enhance telecom business performance [108] - The retail division continues to optimize its store portfolio, focusing on strategic locations and enhancing customer loyalty through its O+O strategy [44][46] - Sustainability initiatives are being prioritized across divisions, with a focus on decarbonization and improving ESG ratings [97][106] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by inflation, military conflicts, and currency volatility but highlighted the strength of the company's diverse portfolio in maintaining steady performance [114][115] - The outlook for the second half of the year is cautiously optimistic, particularly for the retail sector in China, which is expected to improve as restrictions ease [110] - The company remains committed to shareholder value and plans to continue share buybacks post the completion of the U.K. tower deal [109] Other Important Information - The company is expecting significant proceeds from the Cellnex tower deal, estimated at €3.7 billion, which will positively impact the net debt ratio [36][86] - The merger in Indonesia has resulted in a substantial increase in the active customer base and EBITDA, showcasing the benefits of consolidation [90][91] Q&A Session Summary Question: How has the group been affected by inflation, military conflicts, and pandemic restrictions? - Management stated that the diverse portfolio allows the company to balance out risks and maintain steady performance despite external challenges [114][115]