HYSAN DEV(00014)2023-08-30 09:08Financial Performance - For the six months ended June 30, 2023, the company's revenue decreased by 9.3% year-on-year to HKD 1,611 million[4]. - The company's recurring basic profit fell by 12.2% year-on-year to HKD 1,026 million[4]. - The basic profit attributable to shareholders was HKD 1,026 million, down 16.9% from the previous year[4]. - The group reported a profit attributable to shareholders of HKD 190 million for the six months ended June 30, 2023, compared to HKD 71 million in the same period of 2022[65]. - The company reported a profit for the period of HKD 333 million, slightly down from HKD 335 million in the previous year, representing a decrease of 0.6%[43]. - Gross profit for the same period was HKD 1,347 million, down 11.9% from HKD 1,529 million year-over-year[43]. - The consolidated profit before tax for the six months ended June 30, 2023, was HKD 486 million, compared to HKD 517 million for the same period in 2022[57]. - The total comprehensive income for the period was not specified, but the company recognized share-based payments of HKD 2 million in the first half of 2023[47]. - The company reported a total comprehensive income of HKD 1,202 million for the period, reflecting a significant change in financial performance[50]. Revenue Breakdown - For the six months ended June 30, 2023, the total revenue from rental investment properties was HKD 1,419 million, with contributions from office (HKD 645 million), retail (HKD 682 million), and residential (HKD 92 million) segments[56]. - The office segment revenue fell by 7.5% to HKD 745 million, while the retail segment revenue decreased by 9.9% to HKD 762 million[11]. - The group's retail revenue decreased by 9.9% to HKD 762 million (2022: HKD 846 million), while rental income based on revenue increased by 67% year-on-year to HKD 87 million (2022: HKD 52 million) due to a recovery in consumer spending[14]. - The segment profit for the office division was HKD 630 million, while the retail and residential divisions reported profits of HKD 641 million and HKD 76 million respectively[56]. Dividend and Equity - The company maintained an interim dividend of HKD 0.27 per share, unchanged from the previous year[4]. - The group declared an interim dividend of HKD 0.27 per share, amounting to HKD 277 million, for the six months ended June 30, 2023[68]. - The company's total equity attributable to owners was HKD 70,200 million as of June 30, 2023, compared to HKD 68,729 million at the end of 2022[48]. - The company's equity attributable to owners was HKD 7,723 million, an increase from HKD 7,723 million as of January 1, 2023[47]. - The total equity attributable to owners, including revaluation and other reserves, was HKD 83,411 million as of June 30, 2023[47]. Market Conditions - The unemployment rate in Hong Kong decreased to 2.9%, indicating an improvement in the local labor market[6]. - The global economic outlook remains uncertain, with the IMF lowering its growth forecast for 2023 to 2.8%[6]. - Retail sales recovery outperformed the overall Hong Kong retail market, driven by promotional activities and government consumption voucher schemes[16]. Operational Highlights - The overall occupancy rates for the office and retail segments were 89% and 98%, respectively[3]. - Approximately 11% of retail space was temporarily closed due to significant optimization works in the Lee Garden area, impacting retail revenue[11]. - The occupancy rate of the retail business remained stable at 98% as of June 30, 2023 (December 31, 2022: 99%) despite a challenging market[14]. - The high-end residential project, Linhai Mountain City, received satisfactory approval in Q1 2023, achieving record transaction prices and unit prices despite market uncertainties[10]. - The company has established a joint venture with IWG plc to operate shared workspace brands in Hong Kong and the Greater Bay Area, currently managing 36 locations with plans for further expansion[21]. Financial Position - The company's total equity decreased by 2.1% to HKD 68,729 million as of June 30, 2023[4]. - Total debt decreased to HKD 25,730 million as of June 30, 2023, from HKD 27,487 million on December 31, 2022, with less than 5% of total debt maturing in the next 18 months[30]. - The debt-to-equity ratio as of June 30, 2023, was 25.9%, up from 23.4% on December 31, 2022, while the net interest coverage ratio fell to 10.3 times from 13.1 times[34]. - Cash and bank deposits totaled approximately HKD 4,361 million as of June 30, 2023, down from HKD 7,771 million on December 31, 2022[35]. - The company's cash and cash equivalents decreased to HKD 666 million from HKD 2,560 million at the end of 2022, a decline of 74%[45]. Investment and Development - The group plans to open the Caroline Hill Road project by the end of 2026, which is a key part of the overall planning for the Lee Garden area[10]. - The commercial property development project at Caroline Hill Road is on schedule, with foundation work ongoing and superstructure work expected to commence in Q3 2023, aiming for completion by the end of 2026[18]. - The company reported an investment income of HKD 138 million and other losses of HKD 32 million during the reporting period[56]. - The company invested in New Wind Tianyu Group, a leading private healthcare service provider in mainland China, allowing the company to tap into the growing demand for quality healthcare services[22]. Corporate Governance and Compliance - The company continues to comply with the corporate governance code as per the Hong Kong Stock Exchange regulations[94]. - The company held a hybrid annual general meeting on May 16, 2023, allowing shareholders to attend either in person or via an online streaming system, enhancing participation opportunities[96]. - The proportion of independent non-executive directors increased from 46% to 54.5% following the appointment of new directors, improving board independence[97]. - The percentage of female directors on the board rose from 27% to 36.4%, surpassing the target of 33% for gender diversity[97]. Employee and Remuneration - The total number of employees as of June 30, 2023, was 468, aligning with the company's human resources policy aimed at sustainable growth[123]. - The total remuneration for directors and senior management for the six months ended June 30, 2023, was HKD 30 million, an increase from HKD 28 million in the same period of 2022, representing a 7.14% growth[82]. - The company’s remuneration policy emphasizes fair and performance-based compensation aligned with long-term strategies and shareholder interests[103].