SHK PPT(00016)2024-10-07 08:34Key Projects - The company's key projects include Shanghai Xujiahui ITC, Shanghai Lujiazui Shanghai IFC, Hong Kong Kai Tak The Cullinan, Hong Kong West Kowloon ICC, Hong Kong Central IFC II, and Hong Kong West Kowloon High-Speed Rail Station Development Project[2] - The high-speed rail West Kowloon Terminus development project, expected to be completed in 2026, includes two premium Grade A office towers and a podium mall[29] - The ITC Phase III in Shanghai, including the B office tower and ITC Maison mall, will be completed in phases by 2025[55] - The Millennity's base mall in Kwun Tong is planned to open in phases starting from the end of 2024, and the first office tower at IGC above the West Kowloon High-Speed Rail Station will begin delivery to tenants in early 2026[55] - The company plans to launch multiple major Hong Kong projects in the next ten months, including the first phase of Kai Tak's The Cullinan Skyline, a new building at The YOHO Hub II in Yuen Long, and the second phase of YOHO WEST in Tin Shui Wai[56] - The International Gateway Centre (IGC) project, with a total gross floor area of 2.6 million square feet, is expected to be completed and delivered to major tenants by early 2026[119] - The Art Square development in the West Kowloon Cultural District will provide approximately 672,000 square feet of Grade A office space and 27,000 square feet of retail space, with completion expected by the end of 2026[119] - The Mong Kok integrated commercial project, with a gross floor area of 1.4 million square feet and a 320-meter-high commercial tower, is expected to be completed by 2030[120] - The Tianshi residential project in Kai Tak will feature a 220,000 square feet retail podium, expected to open in 2026, with seamless connectivity to the Kai Tak MTR station[121] Financial Performance - Group revenue increased slightly by 0.4% to HKD 71,506 million compared to HKD 71,195 million in the previous year[9] - Profit attributable to shareholders decreased by 20.3% to HKD 19,046 million from HKD 23,907 million[9] - Rental income rose by 2.8% to HKD 24,991 million, with net rental income increasing by 2.9% to HKD 19,000 million[9] - Net debt to equity ratio increased marginally by 0.14 percentage points to 18.3%[9] - Basic earnings per share attributable to shareholders decreased by 20.3% to HKD 6.57 from HKD 8.25[9] - Total dividends for the year decreased by 24.2% to HKD 3.75 per share from HKD 4.95 per share[9] - The company's underlying profit attributable to shareholders for the year ended June 30, 2024, was HKD 21.739 billion, compared to HKD 23.885 billion in the previous year[14] - The total dividend per share for the year was HKD 3.75, a 24% decrease compared to the previous year[15] - Profit from property sales for the year was HKD 7.85 billion, down from HKD 11.299 billion in the previous year[16] - Total rental income increased by 3% year-on-year to HKD 24.991 billion, with net rental income also rising by 3% to HKD 19 billion[17] Land Reserves and Property Development - Total land reserves in Hong Kong decreased by 0.3% to 57.8 million square feet, with completed properties increasing by 4.9% to 38.2 million square feet[9] - Mainland China land reserves decreased by 1.2% to 66.7 million square feet, with completed properties increasing by 2.9% to 21.0 million square feet[9] - The company added three residential sites with a total gross floor area of approximately 1.548 million square feet during the year[19][20] - The company's land reserve in Hong Kong as of June 30, 2024, was approximately 57.8 million square feet, with 38.2 million square feet being diversified completed properties[20] - The company's land reserve in mainland China totaled approximately 66.7 million square feet, with 21 million square feet completed and 45.7 million square feet under development[30] - The group's total gross floor area of land reserves in Hong Kong reached 57.8 million square feet as of June 30, 2024, including 19.6 million square feet of properties under development and 38.2 million square feet of completed properties[69] - The group added three new residential sites to its land reserves during the year, with a total gross floor area of approximately 1.5 million square feet[69] - The group's land reserves in Hong Kong include approximately 13.3 million square feet for the development of various types of residential properties for sale[69] - The group's completed property portfolio is primarily used for long-term rental and investment, with many core commercial projects located along railway lines and certified as green buildings[69] Rental Income and Property Portfolio - Total rental income from diversified investment properties in Hong Kong increased by 1% year-on-year to HKD 17.94 billion[25] - The retail property portfolio achieved an average occupancy rate of approximately 94%, with a total gross floor area exceeding 12 million square feet[25] - The average occupancy rate of the office portfolio remained at approximately 91%, supported by high green building standards and strong tenant relationships[27] - The group's net rental income from its diversified high-quality rental property portfolio was HK$13.423 billion, an increase of 1% compared to the previous fiscal year[68] - Total rental income increased by 1% year-on-year to HKD 17.94 billion, with an average occupancy rate of approximately 92% for the property investment portfolio[108] - Retail property portfolio's total rental income rose by 3% year-on-year to HKD 9.283 billion, with an average occupancy rate maintained at 94%[108] - The retail property portfolio has a total gross floor area of over 12 million square feet[108] - The company's office portfolio maintains an average occupancy rate of 91%[115] - The Millennity and its base mall achieved WELL Core Platinum certification, making it the first WELL-certified office and retail project in Hong Kong[115] Sustainability and ESG Initiatives - The company has achieved a 25% reduction in greenhouse gas emissions from its major commercial properties over four years[48] - The company plans to double the number of fast EV charging stations in its shopping malls in the coming months, currently having installed nearly 40 stations[50] - The company is developing Hong Kong's first solar power plant on a landfill site, expected to generate 1.2 million kWh annually[50] - The company has secured LEED Platinum pre-certification for its Hangzhou International Finance Center project in mainland China[48] - The company has been awarded the highest AAA rating in the Hang Seng Corporate Sustainability Index and an A rating from MSCI ESG[47] - The company has introduced electric construction equipment, becoming a pioneer in Hong Kong's construction industry[50] - The company has been recognized as the "Best Property Company in Hong Kong" by Euromoney and Finance Asia[47] - The company has entered the Dow Jones Sustainability Asia Pacific Index, ranking in the top 20% for sustainability performance in the Asia-Pacific region[47] - The company is committed to sustainable development, integrating ESG elements into its property development and management operations[58] Corporate Governance and Leadership - The company's board of directors includes executive directors such as Kwok Ping Luen (Chairman and Managing Director) and non-executive directors like Lau Tak Yiu and Fung Sau Yin[4] - The company's audit and risk management committee is chaired by Lee Ka Shing, with members including Yip Dick Kay and Leung Nai Pang[5] - The company's registered office is located at 45/F, Sun Hung Kai Centre, 30 Harbour Road, Hong Kong, with contact details provided[6] - The company's shares are listed on the Hong Kong Stock Exchange and traded as American Depositary Receipts (ADRs) in the US over-the-counter market[7] - The company provides options for shareholders to choose the language version or method of receiving company communications, with details on how to request printed copies or change preferences[8] Mainland China Operations - Contract sales in mainland China reached approximately RMB 11 billion, primarily from landmark projects in Shanghai and Hangzhou[31] - Approximately 1.5 million square feet of properties were completed in mainland China, including the Suzhou Four Seasons Hotel, which opened at the end of 2023[31] - The group's total rental income in mainland China increased by 12% year-on-year to RMB 5.822 billion, driven by contributions from newly completed projects and joint ventures[34] - The group's unbooked contract sales in mainland China reached RMB 12.6 billion as of June 30, 2024, with approximately RMB 8 billion expected to be recognized in the 2024/25 fiscal year[32] - The Nanjing International Finance Center Mall, with a total gross floor area of 1 million square feet, officially opened in July 2024, achieving high occupancy rates since its trial operation in January 2024[36] - The Shanghai ITC Phase 3A office building, with a total gross floor area of 1.1 million square feet, has achieved a leasing rate of over 70%[37] - The Hangzhou International Finance Center project is progressing well, with the office buildings in the West Hub set to begin marketing soon and expected to be completed in phases starting from 2025[38] - The group's shopping malls in Hong Kong and Guangzhou maintained high occupancy rates, with innovative marketing activities and pet-friendly events driving customer engagement[36] - The group's hotel business in Hong Kong saw a significant recovery, with high occupancy rates maintained at flagship properties like the Four Seasons Hotel and The Ritz-Carlton[39] Technology and Innovation - The group's 5G user base has grown to nearly 40%, with 5G home broadband services becoming a key growth driver[40] - The group's "Di Shang" membership program has exceeded 180,000 members, with a significant increase in mainland members[39] - The group's telecommunications subsidiary, SmarTone, won a prestigious international award for its AI solution at the Mobile World Congress in February 2024[42] - New Internet's MEGA IDC in Tseung Kwan O, equipped with state-of-the-art facilities, saw its first phase launched in the first half of 2024, attracting inquiries from major international cloud service providers and financial institutions, with two banks and a major cloud service provider already moving in[44] - New Internet's data centers are nearly fully leased, with significant increases in renewal rents, demonstrating strong performance[44] - The company is leveraging technology, including AI assistants and mobile apps, to enhance customer satisfaction and streamline operations such as check-in and dining[181] - The company's property management arm, Kai Shing, won the "Property Management (Enterprise Diamond Award)" at the PropTech Excellence Awards for integrating AR technology into its systems[185] - The company's property management team upgraded its real-time typhoon monitoring platform in 2023 to better manage extreme weather challenges[185] - The company's property management division introduced the Mall e-asy mobile app to improve communication with mall tenants and enhance customer shopping experiences[186] - The company is implementing IoT and AI platforms to improve energy efficiency and reduce food waste across its hotels[182] Transportation and Logistics - The Hong Kong Business Aviation Centre recorded strong growth, with passenger volume nearing pre-pandemic levels, and its terminal is undergoing a major renovation to enhance customer experience, aiming to become Asia's best private jet base[43] - The Airport Freight Terminal's business remained stable due to improved export volumes, and it plans a major renovation to upgrade facilities to world-class standards[43] - Introduced 82 electric buses, including 52 double-decker buses, reducing 3,800 tons of carbon emissions and covering 40 routes with over 2.7 million kilometers traveled[198] - Airport Freight Terminal Co., Ltd. operates over 1.6 million square feet of logistics facilities, planning a full renovation to be completed by 2026[198] - Kowloon Motor Bus implemented a preventive maintenance system and real-time passenger load information display to enhance safety and passenger experience[198] - Cross-border transportation services with Shenzhen Bus Group to capitalize on Greater Bay Area development opportunities[198] - Port operations include 4 berths and a 3.3-hectare container yard in Kwai Tsing, with 50% ownership of a 65-hectare river terminal in Tuen Mun[199] - Global economic weakness and geopolitical risks continue to pressure cargo handling volumes in port operations[199] - Hong Kong Business Aviation Centre holds a 35% stake and achieved Stage 3 certification under the International Business Aviation Council standards[200] - Recognized as "Best Business Aviation Base in Asia" for the 17th consecutive year and "Best Business Aviation Base in Asia-Pacific" in 2024[200] Future Development and Strategy - The company expects a significant decrease in overall construction expenses in the next few fiscal years[55] - The company's property investment portfolio will be enhanced with new projects, contributing to recurring income and rental revenue in the next two to three years[55] - The company maintains a large recurring income from rental properties and non-property businesses, leveraging its high-quality reputation to accelerate asset turnover in property development[55] - The company's strategy focuses on balancing income sources, concentrating on Hong Kong, and expanding in mainland China[61] - The company will continue to sell completed residential units and some non-core properties, with the North Point's Victoria Harbour II units recently starting tender sales[56] - The company's core values include building quality properties, providing excellent services, and creating sustainable value for communities[59] - The company is involved in smart green collective transportation system projects currently in the planning phase[103] - The West Rail Line and Cross-Harbour Tunnel areas are identified as potential future development sites[103]