WHARF HOLDINGS(00004)2024-04-10 09:23Land Reserve and Development Projects - The company's attributable land reserve totals 2.8 million square feet, with approximately 600,000 square feet located on the Peak, including projects such as No. 1 Plantation Road, Kowloon Tong Residential Project, Kai Tak Residential Project (30% interest), and Kowloon Godown Redevelopment Project[3] - The company's unsold land reserve for development properties in mainland China decreased to approximately 1.4 million square meters by the end of 2023[3] - Total land reserve was 2,787,000 square feet, with the Kowloon Tong residential project accounting for 436,000 square feet and the Kowloon East property portfolio accounting for 1,802,000 square feet[23] - The group's land reserves include 2.8 million square feet in Hong Kong and 1.4 million square meters in mainland China, with flagship projects in both regions[71] Hotel Operations - The company manages 16 hotels in Hong Kong, mainland China, and the Philippines, offering over 5,000 rooms and suites, including five Niccolo hotels and ten Marco Polo hotels, with the new lifestyle hotel brand Mǎkè opening its first property in Changsha IFS in November 2023[3] - The company launched a new high-end lifestyle hotel brand, Marco, with the first hotel opening in Changsha IFS in November 2023, and currently operates or owns 16 hotels in Hong Kong, mainland China, and the Philippines[30] - The Hong Kong Murray Hotel was awarded a 5-star rating in the 2023 Forbes Travel Guide[39] - The Changsha Niccolo Hotel won the THAT'S Hotel Industry Award for Luxury Hotel of the Year[39] - The Chengdu Niccolo Hotel was recognized as one of the Top 100 Hotels in China in 2022[39] - The Chongqing Niccolo Hotel was awarded the City Life Award for Destination Cloud Luxury Hotel of the Year in 2023[39] - The Suzhou Niccolo Hotel was named the Luxury Art Landmark of the Year by Go Travelling[39] - The Marco Polo Hongkong Hotel's restaurant received a 4-star rating in the 2023 Forbes Travel Guide[39] - The Wuhan Marco Polo Hotel was listed as one of the top luxury hotels in Wuhan by Ctrip[39] - The Changsha Marco Polo Hotel won the THAT'S Hotel Industry Award for Best Newly Opened Hotel[39] - Hotel revenue rebounded by 66% to HKD 611 million, recording an operating profit of HKD 107 million[52] - The hotel segment manages 16 hotels across Asia, with five being wholly or partially owned by the group[183] Logistics and Infrastructure - The company's logistics infrastructure includes Modern Terminals, a major container terminal operator in Hong Kong and Shenzhen, and Hong Kong Air Cargo Terminals, both crucial to maintaining Hong Kong's status as an international trade and transportation hub[3] - Logistics and infrastructure segment revenue decreased by 20% to HKD 2.37 billion, and operating profit decreased by 50% to HKD 378 million[31] - Modern Terminals' throughput in Hong Kong decreased by 15% to 3.7 million TEUs, while throughput at Dachan Bay Terminal (65% owned) in Shenzhen decreased by 5% to 1.9 million TEUs, and Shekou Container Terminal (20% owned) increased by 2% to 6.1 million TEUs[32] - Hong Kong Air Cargo Terminals (21% owned) handled a total cargo volume of 1.6 million tons, a decrease of 2%[33] - Modern Terminals received the 2023 Outstanding Corporate Partner Excellence Award from Hong Kong Customs[40] - The logistics segment includes container terminal operations in Hong Kong and mainland China, as well as air cargo handling services[183] Sustainability and ESG - The company has set a 2030 target to minimize carbon emissions and explore energy efficiency and renewable energy in its operations[4] - The company was awarded the third-highest fundraising organization by the Community Chest for 2022/23 and maintains its position as a constituent of the Hang Seng Sustainability Index Series, with an ESG rating of AA+[4] - The company aims to minimize carbon emissions by 2030, with projects like solar panel installations increasing solar power generation to 431,000 kWh annually[13] - The company raised approximately HKD 14.8 billion through green loans and sustainability-linked loans by 2023[47] - The company conducts climate risk assessments and scenario analyses to identify significant physical and transitional risks and opportunities related to climate change[163] - The company has implemented a Climate Change Policy Statement and is enhancing climate resilience through energy optimization, renewable energy adoption, and green procurement[163] Financial Performance - The company declared a second interim dividend of HK$0.20 per share for 2023, with the record date set for April 10, 2024, and the payment date for April 25, 2024[8] - The company's total revenue increased by 5% to HKD 18.95 billion, driven by development properties and higher dividend income[12] - Basic net profit rose to HKD 3.566 billion, primarily due to a reduction in development property impairment provisions by HKD 3.804 billion[12] - Total assets reached HKD 204.9 billion, with a net debt of HKD 7.8 billion and a low debt-to-equity ratio of 5.3%[12] - The company declared a second interim dividend of HKD 0.20 per share, maintaining the total annual dividend at HKD 0.40 per share[12] - The company's total income for 2023 was HKD 18.95 billion, with operating profit at HKD 6.896 billion, marking a 4% increase[16] - Basic net profit per share was HKD 0.40, and shareholder profit/(loss) per share was HKD 46.79[19] - Group's underlying net profit increased to HKD 3.566 billion, primarily due to a decrease in provisions for development properties to HKD 1.933 billion[52] - Group revenue increased by 5% to HKD 18.95 billion, with operating profit up 4% to HKD 6.896 billion[52] - Investment properties revenue slightly decreased by 1% to HKD 4.843 billion, with operating profit also down 1% to HKD 3.207 billion[52] - Development properties revenue rose 15% to HKD 8.562 billion, with operating profit up 32% to HKD 1.232 billion[52] - Logistics revenue decreased by 20% to HKD 2.37 billion, with operating profit down 50% to HKD 378 million[52] - Investment operating profit increased by 34% to HKD 2.03 billion, driven by higher dividend income[52] - Unrealized revaluation loss on investment properties amounted to HKD 1.617 billion as of December 31, 2023[53] - Other net expenses totaled HKD 1.6 billion, including impairment provisions for development properties of HKD 489 million[54] - Financial expenses increased by 40% to HKD 905 million, with the actual borrowing rate rising to 4.7%[55] - Share of associates and joint ventures' performance: Profit from associates was HKD 249 million (2022: HKD 21 million), while loss from joint ventures was HKD 1,699 million (2022: HKD 121 million), mainly due to impairment provisions for development properties of HKD 1,449 million (2022: HKD 1,497 million) and net revaluation loss on investment properties of HKD 500 million (2022: surplus of HKD 17 million)[56] - Tax expenses decreased by 34% to HKD 1,090 million (2022: HKD 1,660 million), primarily due to reduced tax provisions from lower profits in mainland investment and development property transactions[57] - Group's underlying net profit rebounded to HKD 3,566 million (2022: HKD 303 million), with development property losses narrowing by 77%, including a profit of HKD 150 million in Hong Kong (after impairment provisions of HKD 78 million) and a loss of HKD 1,083 million in mainland China (after impairment provisions of HKD 1,855 million)[57] - Contracted sales dropped by 44% to HKD 3,189 million (2022: HKD 5,678 million), with Hong Kong sales falling by 67% to HKD 343 million (2022: HKD 1,025 million) and mainland sales decreasing by 38% to RMB 2,579 million (2022: RMB 4,156 million)[58] - Shareholders' equity decreased by 6% to HKD 143 billion (2022: HKD 151.6 billion), equivalent to HKD 46.79 per share (2022: HKD 49.60 per share), due to a HKD 9.8 billion revaluation loss on listed equity investments[59] - Total operating assets (excluding bank deposits, cash, certain financial and deferred tax assets) decreased by 6% to HKD 192.8 billion (2022: HKD 205.9 billion), with real estate, logistics, and investment assets accounting for 69%, 9%, and 22% of total operating assets, respectively[59] - Investment properties portfolio was reported at HKD 71.2 billion (2022: HKD 69.2 billion), accounting for 37% of total operating assets, including HKD 18 billion in Hong Kong (2022: HKD 14.6 billion) and HKD 53.2 billion in mainland China (2022: HKD 54.6 billion)[60] - Development property assets decreased by 13% to HKD 37.2 billion (2022: HKD 43 billion), including HKD 29.3 billion in Hong Kong (2022: HKD 28.5 billion) and HKD 7.9 billion in mainland China (2022: HKD 14.5 billion)[60] - Long-term investments totaled HKD 42.4 billion (2022: HKD 48.9 billion), with HKD 34.6 billion (2022: HKD 40.3 billion) in listed equities, primarily blue-chip stocks held for long-term capital growth and/or reasonable dividend income[61] - Sales deposits decreased by 79% to HKD 1.7 billion (December 2022: HKD 8.2 billion), to be recognized in the coming years[63] - Net debt increased by 47% to HKD 7.8 billion (December 2022: HKD 5.3 billion), with a net debt to total equity ratio of 5.3% (December 2022: 3.4%)[63] - Total available credit facilities and issued debt securities amounted to HKD 36.6 billion, with HKD 19.4 billion utilized as of December 31, 2023[64] - The group's debt portfolio includes USD, HKD, and RMB, primarily used to fund investment properties, development properties, and port investments[65] - Operating cash inflow before working capital changes was HKD 5.2 billion (2022: HKD 5.1 billion), with a net inflow of HKD 2.4 billion after tax and other changes[65] - Investment activities resulted in a net outflow of HKD 3.5 billion (2022: inflow of HKD 4.3 billion), mainly due to net purchases of long-term investments[66] - Total capital and development expenditures for 2023 were HKD 5.134 billion, with HKD 4.611 billion allocated to development properties[67] - Estimated major expenditures for the next fiscal year are HKD 14.181 billion, with HKD 5.772 billion already committed[68] - Revenue for 2023 increased to HKD 18,950 million from HKD 18,064 million in 2022, representing a growth of 4.9%[174] - Operating profit before depreciation, amortization, interest, and taxes rose to HKD 7,602 million in 2023, up from HKD 7,320 million in 2022[174] - Net profit attributable to shareholders improved significantly to HKD 945 million in 2023, compared to a loss of HKD 1,705 million in 2022[174] - Basic and diluted earnings per share for 2023 were HKD 0.31, a recovery from a loss of HKD 0.56 per share in 2022[174] - The fair value decrease of investment properties was HKD 746 million in 2023, up from HKD 264 million in 2022[174] - Other comprehensive loss for the year was HKD 7,285 million, slightly lower than the HKD 7,807 million loss in 2022[175] - Total comprehensive loss for the year was HKD 6,180 million, an improvement from HKD 9,241 million in 2022[175] - The company's share of other comprehensive income from associates and joint ventures was a loss of HKD 236 million in 2023, compared to a loss of HKD 1,252 million in 2022[175] - Total assets decreased from HKD 221,745 million in 2022 to HKD 204,877 million in 2023[176] - Net profit for the year was HKD 945 million, compared to a loss of HKD 1,705 million in 2022[178] - Cash and cash equivalents decreased from HKD 14,648 million in 2022 to HKD 11,593 million in 2023[179] - Total equity decreased from HKD 155,707 million in 2022 to HKD 148,203 million in 2023[176] - Operating cash inflow increased slightly from HKD 5,141 million in 2022 to HKD 5,244 million in 2023[179] - Investment properties decreased from HKD 69,222 million in 2022 to HKD 71,244 million in 2023[176] - Total liabilities decreased from HKD 66,038 million in 2022 to HKD 56,674 million in 2023[176] - Revenue from other long-term investments increased from HKD 1,337 million in 2022 to HKD 1,753 million in 2023[179] - Net cash used in financing activities decreased significantly from HKD 17,552 million in 2022 to HKD 1,745 million in 2023[179] - Total comprehensive income for the year was a loss of HKD 6,180 million, compared to a loss of HKD 9,241 million in 2022[178] - Operating profit increased to HKD 6,896 million in 2023 from HKD 6,603 million in 2022, reflecting a growth of 4.4%[180] - Cash and cash equivalents decreased to HKD 11,593 million in 2023 from HKD 14,648 million in 2022, a decline of 20.9%[181] - New bank and other borrowings amounted to HKD 10,997 million in 2023, compared to HKD 8,258 million in 2022, showing a 33.1% increase[182] - Repayment of bank and other borrowings was HKD 11,371 million in 2023, down from HKD 24,336 million in 2022, a significant reduction of 53.3%[182] - The total cash inflow from operating activities was HKD 3,246 million in 2023, a decrease from HKD 6,692 million in 2022, marking a 51.5% decline[180] - Total group revenue for 2023 reached HKD 18,950 million, compared to HKD 18,064 million in 2022[185] - Investment properties segment revenue for 2023 was HKD 4,843 million, with operating profit of HKD 3,207 million[184] - Development properties segment revenue for 2023 increased to HKD 8,562 million from HKD 7,462 million in 2022[185] - Logistics segment revenue for 2023 decreased to HKD 2,370 million from HKD 2,964 million in 2022[185] - Hotel segment revenue for 2023 increased to HKD 611 million from HKD 369 million in 2022[185] - Total group operating assets for 2023 were HKD 204,877 million, down from HKD 221,745 million in 2022[186] - Capital expenditures for 2023 totaled HKD 523 million, compared to HKD 1,359 million in 2022[188] - Depreciation and amortization expenses for 2023 were HKD 706 million, slightly down from HKD 717 million in 2022[188] - The group made provisions of HKD 1,938 million for certain development properties of subsidiaries, joint ventures, and associates in 2023[188] - Group total revenue increased to HKD 18,950 million in 2023 from HKD 18,064 million in 2022, representing a growth of 4.9%[189] - Mainland China contributed HKD 14,030 million to revenue in 2023, slightly up from HKD 13,977 million in 2022[189] - Operating profit for the group rose to HKD 6,896 million in 2023 from HKD 6,603 million in 2022, a 4.4% increase[189] - Total depreciation and amortization decreased to HKD 706 million in 2023 from HKD 717 million in 2022[192] - Employee costs decreased to HKD 1,580 million in 2023 from HKD 1,646 million in 2022[192] - Interest income from financial assets at amortized cost dropped to HKD 322 million in 2023 from HKD 662 million in 2022[193] - Total remuneration for the board of directors decreased to HKD 44,892 thousand in 2023 from HKD 52,238 thousand in 2022[195] - Total remuneration for the top five highest-paid employees decreased to HKD 14 million in 2023 from HKD 21 million in 2022[198] - Non-current assets designated for the group totaled HKD 111,851 million in 2023, slightly down from HKD 112,453 million in 2022[190] - Total operating assets for the group decreased to HKD 192,780 million in 2023 from HKD 205,869 million