香港交易及結算所有限公司及香港聯合交易所有限公司對本公告之內容概不 負 責，對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示 概 不 就 因 本 公 告 全 部或任何部分內容而產生或因倚賴該等內容而引致之任何損失承擔任何責任。 2025年上半年，面對錯綜複雜的外部環境和諸多壓力挑戰，公司上下凝心聚力、 攻 堅 克 難，牢 牢 把 握 數 智 化 轉 型 重 要 機 遇，緊 扣「一 二 二 五」1戰 略 實 施 思 路，全 面 推 進「三 大 計 劃」2，深 化 改 革 攻 堅、創 新 突 破，深 化 轉 型 升 級、動 能 轉 換，深 化 精 細 運 營、精 益 管 理，經 營 業 績 穩 健 增 長，發 展 質 量 不 斷 提 高，數 智 化 轉 型 取 得 新 成 效，向 世 界 一 流 信 息 服 務 科 技 創 新 公 司 堅 實 邁 進。 2025上半年業績表現 CHINA MOBILE LIMITED 中國移動有限公司 （根據公司條例在香港註冊成立之有限公司） 股份代號：941（港幣櫃台）及 80941（人民幣櫃台） 2025年中期業績 – 1 – • 營運收 ...

[Performance Highlights](index=1&type=section&id=Performance%20Highlights) This section provides an overview of the Group's financial performance, interim dividend declaration, and key operational achievements for the period [Group Performance](index=1&type=section&id=Group%20Performance) For the six months ended June 30, 2025, the Group's underlying net profit remained stable at HKD 3.119 billion, consistent with the prior year, but a widened revaluation loss on investment properties of HKD 5.118 billion led to an increased loss attributable to shareholders of HKD 2.406 billion, with basic loss per share at HKD 0.79 H1 2025 Performance Overview | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Underlying Net Profit | HKD 3.119 billion | HKD 3.123 billion | | Net Revaluation Loss on Investment Properties | (HKD 5.118 billion) | (HKD 4.426 billion) | | Group Loss Attributable to Shareholders | (HKD 2.406 billion) | (HKD 1.052 billion) | | Basic Earnings Per Share | HKD 1.03 | HKD 1.03 | | Basic Loss Per Share | (HKD 0.79) | (HKD 0.35) | [Interim Dividend](index=1&type=section&id=Interim%20Dividend) The Board declared a first interim dividend of HKD 0.66 per share, a 3.1% increase from the prior year, totaling HKD 2.004 billion, representing 65% of underlying net profit from Hong Kong investment properties and hotels, reflecting consistent dividend policy Interim Dividend Details | Item | Amount/Date | | :--- | :--- | | First Interim Dividend | HKD 0.66 per share (2024: HKD 0.64) | | Total Dividend Payout | HKD 2.004 billion | | Payment Date | September 11, 2025 | [Performance Highlights](index=1&type=section&id=Performance%20Highlights) Despite declining investment property income and profit, and expanded revaluation losses, the Group achieved a 27% reduction in borrowing costs and a record-low gearing ratio of 17.6% through effective financial management, maintaining robust underlying net profit and increasing interim dividend payout - **Financial Optimization**: Borrowing costs reduced by **27%**, gearing ratio decreased to a new low of **17.6%**[6](index=6&type=chunk) - **Profitability**: Underlying net profit remained stable, but revaluation loss on investment properties widened[6](index=6&type=chunk) - **Shareholder Returns**: Consistent dividend policy maintained, with an increase in interim dividend per share[6](index=6&type=chunk) [Business Review and Outlook](index=2&type=section&id=Business%20Review%20and%20Outlook) This section reviews the market environment, performance of core properties, and the Group's strategic outlook [Market Environment and Financial Management](index=2&type=section&id=Market%20Environment%20and%20Financial%20Management) Amid geopolitical tensions and economic uncertainties, Hong Kong's retail market shows initial recovery, while office and hotel sectors remain under pressure; the Group's prudent financial management reduced net debt to a post-listing low and maintained a healthy gearing ratio of 17.6%, effectively navigating market volatility - **Market Trends**: Inbound tourist arrivals increased by **12%**, retail sales decline narrowed, with positive growth in the last two months; the office market faces dual pressures of weak demand and oversupply[7](index=7&type=chunk) - **Financial Strategy**: Maintained prudent financial management and actively reduced debt[7](index=7&type=chunk) Key Financial Management Indicators | Indicator | Period-End Data | | :--- | :--- | | Net Debt | HKD 33.3 billion (Lowest since listing) | | Average Interest Cost | 4.4% | | Borrowing Cost Savings | 27% | | Gearing Ratio | 17.6% | [Core Property Performance](index=2&type=section&id=Core%20Property%20Performance) During the period, Harbour City maintained stable overall revenue and operating profit with a 93% mall occupancy rate, while Times Square's overall revenue and operating profit declined by 15% and 19% respectively due to market conditions, though its mall occupancy rate rose to 96%; both properties actively introduced top brands and new concept stores to enhance competitiveness [Harbour City](index=2&type=section&id=Harbour%20City) Harbour City's overall revenue and operating profit, including hotels, remained largely flat; the mall maintained its market-leading position by introducing several top brands' first Hong Kong stores and expanding flagship stores, achieving a 93% occupancy rate, while the office occupancy rate remained at 90% but faced rental pressure due to market competition - **Overall Performance**: Revenue and operating profit changed by less than **1%**[9](index=9&type=chunk) - **Mall Leasing**: Attracted brands like Louis Vuitton (expansion), Canali, Urban Revivo, and Bacha Coffee to open their first Hong Kong stores or concept stores[10](index=10&type=chunk) - **Occupancy Rate**: Mall at **93%**, office at **90%**[11](index=11&type=chunk) [Times Square](index=3&type=section&id=Times%20Square) Times Square's overall revenue decreased by 15% and operating profit by 19%; to address challenges, the mall actively updated its tenant mix, introducing Louis Vuitton, expanding LOEWE, and opening Cristiano Ronaldo's first global CR7® flagship store, boosting its occupancy rate to 96%, while the office occupancy rate remained at 90% but faced rental pressure from new supply Times Square Performance Changes | Indicator | Year-on-Year Change | | :--- | :--- | | Overall Revenue | -15% | | Operating Profit | -19% | - **Mall Leasing**: Introduced Louis Vuitton and Cristiano Ronaldo's first global CR7® store, strengthening the luxury brand lineup[13](index=13&type=chunk) - **Occupancy Rate**: Mall increased to **96%**, office maintained at **90%**[14](index=14&type=chunk) [Outlook](index=3&type=section&id=Outlook) Despite macroeconomic challenges, the Group maintains cautious optimism for the Hong Kong market, anticipating that capital inflows into Hong Kong stocks, the opening of Kai Tak Sports Park, and major events will boost the economy and consumer sentiment; the Group will uphold proactive management strategies and a low leverage ratio to navigate adversities and seize opportunities - **Positive Factors**: Hong Kong stocks regaining upward momentum, the opening of Kai Tak Sports Park, and major events are expected to enhance Hong Kong's attractiveness[15](index=15&type=chunk) - **Group Strategy**: Maintain proactive management and a low leverage ratio, rigorously screen capital investments, and utilize robust cash flow to seize future opportunities[15](index=15&type=chunk) [Financial Review](index=4&type=section&id=Financial%20Review) This section provides a detailed review of the Group's interim financial results, liquidity, financial resources, capital commitments, and human resources [Interim Results Review](index=4&type=section&id=Interim%20Results%20Review) The Group's total revenue slightly decreased by 1% to HKD 6.407 billion, and operating profit fell by 5% to HKD 4.684 billion, primarily due to a decline in investment property segment revenue, while hotel business revenue and profit both grew; despite an expanded revaluation loss on investment properties leading to a HKD 2.406 billion loss attributable to shareholders, underlying net profit remained stable at HKD 3.119 billion after excluding non-cash items Revenue and Operating Profit by Business Segment (HKD million) | Business Segment | Revenue (2025) | Revenue (2024) | Operating Profit (2025) | Operating Profit (2024) | | :--- | :--- | :--- | :--- | :--- | | Investment Properties | 5,371 | 5,542 | 4,528 | 4,718 | | Hotels | 766 | 748 | 47 | 24 | | Property Development | 58 | 8 | (1) | 74 | | Investments | 143 | 140 | 143 | 140 | | **Group Total** | **6,407** | **6,501** | **4,684** | **4,915** | - **Investment Property Revaluation**: Generated a **2%** revaluation loss totaling **HKD 5.15 billion**, resulting in an unrealized revaluation loss attributable to shareholders of **HKD 5.118 billion**[18](index=18&type=chunk) - **Finance Costs**: Effective annual borrowing interest rate decreased from **5.7%** to **4.4%**, primarily due to a decline in HIBOR[20](index=20&type=chunk) [Liquidity, Financial Resources, and Capital Commitments](index=5&type=section&id=Liquidity%2C%20Financial%20Resources%2C%20and%20Capital%20Commitments) The Group's financial position is robust, with shareholders' equity at HKD 185.2 billion and total assets at HKD 234.2 billion as of period-end, 94% of which are in Hong Kong; net debt further decreased to HKD 33.3 billion, and the net debt to total equity ratio fell to 17.6%, with ample credit facilities and liquid investment portfolios, and future capital commitments primarily for Hong Kong investment properties and mainland development properties Key Financial Position Indicators (As of June 30, 2025) | Indicator | Amount/Ratio | Compared to December 31, 2024 | | :--- | :--- | :--- | | Shareholders' Equity | HKD 185.2 billion | Decreased by HKD 2.6 billion | | Total Assets | HKD 234.2 billion | Decreased by HKD 3.9 billion | | Net Debt | HKD 33.3 billion | Decreased by HKD 0.9 billion | | Net Debt to Total Equity Ratio | 17.6% | 17.8% | - **Asset Composition**: Investment property assets accounted for **93%** of operating assets, totaling **HKD 217.2 billion**[25](index=25&type=chunk) - **Credit Facilities**: Total available credit facilities and issued debt securities amounted to **HKD 44.1 billion**, with **HKD 9.4 billion** unused[32](index=32&type=chunk) - **Capital Commitments**: Estimated principal planned expenditures for the coming years are **HKD 936 million**, of which **HKD 240 million** has been committed[35](index=35&type=chunk) [Human Resources](index=8&type=section&id=Human%20Resources) As of June 30, 2025, the Group employed approximately 2,900 staff, with remuneration policies determined by job responsibilities and market trends, including discretionary bonuses linked to individual and Group performance - **Number of Employees**: Approximately **2,900** staff[37](index=37&type=chunk) - **Remuneration Structure**: Fixed remuneration plus performance-linked variable bonuses[37](index=37&type=chunk) [Consolidated Financial Statements](index=9&type=section&id=Consolidated%20Financial%20Statements) This section presents the Group's consolidated income statement, consolidated statement of comprehensive income, and consolidated statement of financial position [Consolidated Income Statement](index=9&type=section&id=Consolidated%20Income%20Statement) For the six months ended June 30, 2025, the Group recorded revenue of HKD 6.407 billion, a 1.4% year-on-year decrease; a HKD 5.15 billion decrease in fair value of investment properties resulted in a loss before tax of HKD 1.847 billion, with the ultimate loss attributable to company shareholders being HKD 2.406 billion Consolidated Income Statement Summary (HKD million) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 6,407 | 6,501 | | Operating Profit | 4,684 | 4,915 | | Decrease in Fair Value of Investment Properties | (5,150) | (4,450) | | Loss Before Tax | (1,847) | (460) | | Loss Attributable to Company Shareholders | (2,406) | (1,052) | | Basic Loss Per Share | (HKD 0.79) | (HKD 0.35) | [Consolidated Statement of Comprehensive Income](index=10&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Income) Loss for the period was HKD 2.475 billion, but positive impacts from fair value changes in equity investments, generating HKD 1.225 billion, and other foreign exchange differences, resulted in other comprehensive income of HKD 1.806 billion, narrowing the total comprehensive loss to HKD 669 million Consolidated Statement of Comprehensive Income Summary (HKD million) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Loss for the Period | (2,475) | (1,067) | | Other Comprehensive Income for the Period | 1,806 | (1,123) | | Total Comprehensive Income for the Period | (669) | (2,190) | | Total Comprehensive Income Attributable to Company Shareholders | (777) | (2,052) | [Consolidated Statement of Financial Position](index=11&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets were HKD 234.2 billion, total liabilities HKD 44.7 billion, and net assets HKD 189.5 billion, with investment properties as core assets valued at HKD 217.2 billion, and shareholders' equity at HKD 185.2 billion Consolidated Statement of Financial Position Summary (HKD million) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Non-current Assets (primarily Investment Properties) | 231,084 | 234,808 | | Total Assets | 234,219 | 238,072 | | Total Liabilities | (44,728) | (46,088) | | Net Assets | 189,491 | 191,984 | | Shareholders' Equity | 185,229 | 187,820 | [Notes to Interim Financial Information](index=12&type=section&id=Notes%20to%20Interim%20Financial%20Information) This section provides detailed segment information and other key notes to the interim financial statements [Segment Information](index=13&type=section&id=Segment%20Information) The Group's business is divided into four segments: investment properties, property development, hotels, and investments, with investment properties being the core source of revenue and profit, contributing over 80% of revenue and the vast majority of operating profit; geographically, Hong Kong is the Group's primary focus, contributing over 94% of revenue and 96% of operating profit H1 2025 Revenue and Operating Profit by Business Segment (HKD million) | Segment | Revenue | Operating Profit/(Loss) | | :--- | :--- | :--- | | Investment Properties | 5,371 | 4,528 | | Property Development | 58 | (1) | | Hotels | 766 | 47 | | Investments | 143 | 143 | | **Group Total** | **6,407** | **4,684** | H1 2025 Revenue and Operating Profit by Geographical Region (HKD million) | Region | Revenue | Operating Profit | | :--- | :--- | :--- | | Hong Kong | 6,043 | 4,504 | | Outside Hong Kong | 364 | 180 | | **Group Total** | **6,407** | **4,684** | [Other Key Notes](index=16&type=section&id=Other%20Key%20Notes) This section provides further explanations of key financial statement items, noting that operating profit is stated after deducting staff costs of HKD 583 million and direct operating expenses for investment properties of HKD 817 million; total finance costs were HKD 853 million, including HKD 749 million in total interest expenses, and total income tax was HKD 628 million; the Board declared a first interim dividend of HKD 0.66 per share - **Composition of Finance Costs**: Total finance costs of **HKD 853 million** included interest expenses on bank and other borrowings of **HKD 749 million** and fair value losses on derivative financial instruments of **HKD 74 million**[54](index=54&type=chunk) - **Income Tax**: Income tax expense for the period was **HKD 628 million**, with Hong Kong profits tax provision at **HKD 595 million**[55](index=55&type=chunk) - **Trade Receivables**: The Group's credit period typically ranges from **0 to 60 days**, with the vast majority of trade receivables aged within **30 days**[60](index=60&type=chunk) Interim Dividend Declared | Item | 2025 | 2024 | | :--- | :--- | :--- | | Interim Dividend Per Share | HKD 0.66 | HKD 0.64 | | Total Dividend | HKD 2.004 billion | HKD 1.943 billion | [Corporate Governance and Other Matters](index=21&type=section&id=Corporate%20Governance%20and%20Other%20Matters) This section outlines the Group's adherence to corporate governance principles, details on securities transactions, and key dates related to the interim dividend [Corporate Governance and Securities Transactions](index=21&type=section&id=Corporate%20Governance%20and%20Securities%20Transactions) During the reporting period, the Company complied with all applicable provisions of the Corporate Governance Code, with the sole exception of the Chairman and Chief Executive Officer roles being held by the same individual, which the Board believes is more effective for executing long-term strategies; neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the period - **Governance Code Compliance**: The Company complied with the Listing Rules' Corporate Governance Code, except for the Chairman and Chief Executive Officer roles being held by the same person[64](index=64&type=chunk) - **Securities Transactions**: No purchases, sales, or redemptions of the Company's listed securities occurred during the reporting period[65](index=65&type=chunk) [Interim Dividend Related Dates](index=21&type=section&id=Interim%20Dividend%20Related%20Dates) The Company announced the key timetable for interim dividend distribution, requiring shareholders to submit share transfer documents by 4:30 p.m. on August 27, 2025, with dividends to be paid on September 11 Interim Dividend Timetable | Event | Date | | :--- | :--- | | Ex-dividend Date | August 26, 2025 | | Record Date | August 27, 2025 | | Payment Date | September 11, 2025 |

[Financial Summary & Performance Overview](index=1&type=section&id=Financial%20%26%20Performance%20Summary) [Financial Summary](index=1&type=section&id=Financial%20Summary) In H1 2025, the company's revenue remained flat at HKD 1.932 billion, while profit for the period surged 36.0% to HKD 327 million, driven by lower costs and a 7.4 percentage point increase in gross profit margin to 36.3% Key Financial Metrics | Metric | H1 2025 | Change | | :--- | :--- | :--- | | Revenue | HKD 1.932 billion | Flat | | Profit | HKD 327 million | ▲ 36.0% | | Gross Profit Margin | 36.3% | ▲ 7.4 percentage points | | Interim Dividend | 19.5 HK cents per share | ▲ 39.3% | [Business Review](index=15&type=section&id=Business%20Review) The Group's revenue slightly decreased by 2.9% to HKD 1.932 billion, while profit surged 36.0% to HKD 327 million, driven by significant cost reductions in the chemical business, improving gross profit margin to 36.3% and net profit margin to 16.9% Key Performance Indicators | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | HKD 1.932 billion | HKD 1.990 billion | | Profit for the Period | HKD 327 million | HKD 240 million | | Gross Profit Margin | 36.3% | 28.9% | | Net Profit Margin | 16.9% | 12.1% | - The primary reason for improved profitability was a **significant decrease in energy costs** and a **decline in raw material prices**, leading to **gross profit growth**[39](index=39&type=chunk) - For the property business, the "Xinyuexi" project has **11 residential units remaining for sale**, with rental income of approximately **HKD 1.7 million** during the period, **contributing minimally** to the Group's overall performance[39](index=39&type=chunk)[44](index=44&type=chunk) [Operating Results](index=16&type=section&id=Operating%20Results) The chemical business, as the core revenue source, generated approximately HKD 1.930 billion in turnover, a slight 2.0% year-on-year decrease, with varied selling price performance across key products and stable production volumes Average Selling Prices of Key Products | Key Product | H1 2025 Average Selling Price (RMB/ton) | Y-o-Y Change | | :--- | :--- | :--- | | Chloromethane | Approx. 2,600 (Dichloromethane) / 2,500 (Trichloromethane) | Flat / ▼ 7% | | Caustic Soda | Approx. 1,000 | ▲ 11% | | PTFE | Approx. 45,000 | Flat | | Hydrogen Peroxide | Approx. 700 | ▼ 22% | Production Volumes of Key Products | Key Product | H1 2025 Actual Production Volume (including self-use) | | :--- | :--- | | Chloromethane | Approx. 211 thousand tons | | 100% Caustic Soda Equivalent | Approx. 310 thousand tons | | PTFE | Approx. 5.0 thousand tons | | 27.5% Hydrogen Peroxide | Approx. 198 thousand tons | [Financial Statements](index=2&type=section&id=Financial%20Statements) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) In H1 2025, revenue slightly decreased to HKD 1.932 billion, but gross profit increased 21.9% to HKD 701 million due to lower cost of sales, leading to a 36.0% surge in profit for the period to HKD 327 million and basic earnings per share of 39.6 HK cents Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Highlights | Item (HKD '000) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue | 1,931,959 | 1,989,690 | | Cost of Sales | (1,230,588) | (1,414,476) | | **Gross Profit** | **701,371** | **575,214** | | R&D Expenses | (82,994) | (54,529) | | Profit Before Tax | 394,923 | 297,776 | | **Profit for the Period** | **326,627** | **240,085** | | **Basic Earnings Per Share (HK cents)** | **39.6** | **29.1** | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, total assets increased to HKD 7.315 billion and total equity to HKD 6.232 billion, with liquidity significantly improving as net current assets rose to HKD 429 million and the current ratio to 1.44, alongside a reduction in bank borrowings to HKD 484 million Condensed Consolidated Statement of Financial Position Highlights | Item (HKD '000) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Non-current Assets** | **5,911,794** | **5,809,033** | | **Current Assets** | **1,403,568** | **1,387,410** | | **Current Liabilities** | **(974,661)** | **(1,146,176)** | | Net Current Assets | 428,907 | 241,234 | | **Non-current Liabilities** | **(108,743)** | **(114,297)** | | **Net Assets** | **6,231,958** | **5,935,970** | | Bank Balances and Cash | 203,434 | 222,781 | | Bank Borrowings | 484,142 | 648,378 | [Notes to Financial Statements](index=6&type=section&id=Notes%20to%20Financial%20Statements) [Revenue](index=7&type=section&id=Revenue) The Group's total revenue primarily from chemical product sales saw caustic soda revenue grow 10.6% to HKD 883 million as a key driver, while other chemical products experienced declines and property sales revenue was zero Revenue by Product/Business Segment | Product/Business (HKD '000) | H1 2025 | H1 2024 | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Caustic Soda | 882,965 | 798,288 | ▲ 10.6% | | Chloromethane | 414,123 | 457,431 | ▼ 9.5% | | Polymer Materials | 193,629 | 230,974 | ▼ 16.2% | | Fluorochemical Products | 164,912 | 133,091 | ▲ 23.9% | | Hydrogen Peroxide | 128,494 | 188,876 | ▼ 31.9% | | **Total Chemical Products** | **1,930,270** | **1,968,854** | **▼ 2.0%** | | Property Sales | – | 18,994 | - | | **Total Revenue** | **1,931,959** | **1,989,690** | **▼ 2.9%** | [Segment Information](index=8&type=section&id=Segment%20Information) The chemical business is the core, contributing almost all revenue and HKD 418 million in segment results, a 39.8% increase, while the property segment recorded a HKD 495 thousand loss, with most of the Group's revenue and non-current assets located in China Segment Performance | Segment (HKD '000) | H1 2025 | H1 2024 | Y-o-Y Change | | :--- | :--- | :--- | :--- | | **Segment Revenue** | | | | | Chemical | 1,930,270 | 1,968,854 | ▼ 2.0% | | Property | 1,689 | 20,836 | ▼ 91.9% | | **Segment Results** | | | | | Chemical | 418,108 | 298,997 | ▲ 39.8% | | Property | (495) | 1,645 | - | - The Group's operations (including chemical and property segments) and the **vast majority of non-current assets** are located in **China**[19](index=19&type=chunk) [Expense & Cost Analysis](index=17&type=section&id=Expense%20%26%20Cost%20Analysis) The company effectively controlled expenses, with selling and distribution, administrative, and finance costs decreasing, while R&D costs significantly increased by 50.9% to HKD 83 million, reflecting a strong focus on product quality and innovation - Selling and distribution expenses **decreased by approximately HKD 9 million** year-on-year, primarily due to a **reduction in property sales commission expenses** during the period[45](index=45&type=chunk) - Administrative expenses **decreased by approximately HKD 4 million** year-on-year, primarily due to a **reduction in carbon emission fees** after implementing carbon reduction measures[46](index=46&type=chunk) - R&D costs **increased by approximately HKD 28 million** year-on-year (**a 50.9% increase**), as the Group focused on **optimizing core product process technology** and **developing new chemical products**[47](index=47&type=chunk) - Finance costs **decreased by approximately HKD 3 million** year-on-year, primarily due to a **reduction in the average loan amount** during the period[48](index=48&type=chunk) [Liquidity, Financial Resources & Capital Structure](index=18&type=section&id=Liquidity%2C%20Financial%20Resources%20%26%20Capital%20Structure) The company's financial position is robust and improving, with the current ratio rising to 1.44 and the net debt to equity ratio significantly decreasing to 3.23%, demonstrating enhanced solvency and reduced leverage, supported by ample cash and credit facilities Liquidity and Capital Structure Metrics | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Shareholders' Equity | HKD 6.232 billion | HKD 5.936 billion | | Current Ratio | 1.44 | 1.21 | | Bank Balances and Cash | HKD 283 million | HKD 291 million | | Net Debt | HKD 201 million | HKD 358 million | | Net Debt to Equity Ratio | 3.23% | 6.03% | - The Group actively **optimized its financing cost structure** across different currencies during the period and will continue to maintain **ample cash** and **available bank credit facilities**[50](index=50&type=chunk) [Shareholder Returns & Corporate Actions](index=12&type=section&id=Shareholder%20Returns%20%26%20Corporate%20Actions) [Dividends](index=12&type=section&id=Dividends) Based on robust earnings and financial health, the Board declared a 2025 interim dividend of 19.5 HK cents per share, a 39.3% increase from the prior period, demonstrating commitment to shareholder returns and confidence in future profitability Interim Dividend Declaration | Dividend Type | 2025 | 2024 | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Interim Dividend | 19.5 HK cents per share | 14 HK cents per share | ▲ 39.3% | - The interim dividend will be paid to shareholders whose names appear on the register of members on **August 25, 2025**, with an estimated payment date of **September 9, 2025**[27](index=27&type=chunk)[37](index=37&type=chunk) [Outlook & Strategy](index=15&type=section&id=Outlook%20%26%20Strategy) [Outlook](index=15&type=section&id=Outlook) Facing a challenging global economic environment, the Group will accelerate factory automation and enhance cost efficiency, focusing on high-end, green, and intelligent product transformation, expanding high-value-added products and overseas sales channels, and committing to sustainable development for long-term shareholder returns - The core strategy is to **accelerate the application of automation in three factories** to **enhance cost efficiency** and **production efficiency**[40](index=40&type=chunk) - The company will align with industry trends to promote production transformation towards **high-end, green, and intelligent solutions**[40](index=40&type=chunk) - Future growth drivers include developing **high-end fluoropolymer production lines** in new land parcels in Jiangxi and continuing to expand **overseas sales channels**[41](index=41&type=chunk) - The Group will continue to **invest in R&D for high-value-added chemical products**, **strengthen its product portfolio**, and promote various **sustainable development initiatives**, such as optimizing energy efficiency, water conservation, and expanding green energy applications[41](index=41&type=chunk) [Corporate Governance & Others](index=18&type=section&id=Corporate%20Governance%20%26%20Others) [Human Resources](index=18&type=section&id=Human%20Resources) As of June 30, 2025, the Group had approximately 1,900 employees, maintaining competitive remuneration and good employee relations without significant labor disputes or recruitment difficulties - As of June 30, 2025, the Group had **approximately 1,900 employees**, maintaining **good labor relations** without any **operational disruptions** due to labor disputes[51](index=51&type=chunk) [Corporate Governance & Audit](index=18&type=section&id=Corporate%20Governance%20%26%20Audit) The company consistently complied with the Corporate Governance Code, and the Audit Committee reviewed the interim results, discussing accounting principles, internal controls, and financial reporting with management without disagreement - The Board believes that the company has **consistently complied with the provisions of the Corporate Governance Code** during the reporting period[53](index=53&type=chunk) - The Audit Committee has **reviewed the Group's interim results** and had **no disagreements**[36](index=36&type=chunk)[54](index=54&type=chunk)

[Performance Summary](index=4&type=section&id=Performance%20Summary) The company's reported profit attributable to shareholders significantly declined, while underlying and recurring underlying profits remained relatively stable, reflecting core business resilience Summary of Financial Performance for H1 2025 | Indicator | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | **Revenue** | HKD 45.774 billion | HKD 39.563 billion | +16% | | **Operating Profit** | HKD 1.861 billion | HKD 4.945 billion | -62% | | **Profit Attributable to Company Shareholders (as per financial statements)** | HKD 0.815 billion | HKD 3.914 billion | -79% | | **Underlying Profit** | HKD 5.476 billion | HKD 5.576 billion | -2% | | **Recurring Underlying Profit** | HKD 4.712 billion | HKD 4.762 billion | -1% | | **Cash from Operations** | HKD 8.438 billion | HKD 5.307 billion | +59% | | **Net Debt** | HKD 71.337 billion | HKD 63.479 billion | +12% | | **Net Debt to Capital Ratio** | 22.7% | 19.8% | +2.9 percentage points | | **Dividend Per Share ('A' Shares)** | HKD 1.30 | HKD 1.25 | +4% | - Profit attributable to company shareholders significantly decreased by **79%**, primarily due to an expanded fair value loss on investment properties[10](index=10&type=chunk) - However, underlying profit and recurring underlying profit, which better reflect core operating performance, only slightly decreased by **2%** and **1%** respectively, indicating the Group's core business performance remained relatively stable[10](index=10&type=chunk)[12](index=12&type=chunk) [Chairman's Statement](index=5&type=section&id=Chairman%27s%20Statement) The Group's overall business performance in H1 2025 was stable, with underlying profit attributable to shareholders slightly down [Overall Performance](index=5&type=section&id=Chairman%27s%20Statement-Overall%20Performance) The Group's overall business performance in H1 2025 was stable, with underlying profit attributable to shareholders at HKD 5.476 billion, a slight 2% year-on-year decrease; the Aviation Division performed well, Property benefited from asset sales, while Beverages faced challenges Profit Overview for H1 2025 | Profit Type | Amount (HKD) | Year-on-Year Change | | :--- | :--- | :--- | | **Underlying Profit Attributable to Shareholders** | 5.476 billion | -2% | | **Recurring Underlying Profit** | 4.712 billion | -1% | | **Consolidated Profit Attributable to Shareholders** | 0.815 billion | -79% | - The fair value loss on investment properties expanded to **HKD 4.664 billion** in the reporting period (compared to HKD 0.877 billion in the prior period), which was the primary reason for the significant decrease in consolidated profit attributable to shareholders[12](index=12&type=chunk) - This change is non-cash in nature and does not affect cash flow or underlying profit[12](index=12&type=chunk) [Strategic Developments](index=5&type=section&id=Chairman%27s%20Statement-Strategic%20Developments) The Group continues to advance strategic initiatives in core markets across Hong Kong, Mainland China, and Southeast Asia - Swire Properties' **HKD 100 billion** investment plan is progressing well, with **67%** of funds already deployed, focusing on Hong Kong, Mainland China, and Southeast Asia markets[14](index=14&type=chunk) - Swire Properties completed the sale of its retail and car park interests in Brickell City Centre, Miami, USA, with proceeds supporting its **HKD 100 billion** investment plan[16](index=16&type=chunk) - Swire Coca-Cola proposed a spin-off and separate listing of its Thailand business (ThaiNamthip) and submitted an application in May 2025 for listing on the Stock Exchange of Thailand[17](index=17&type=chunk) - Cathay Group acquired an additional **14 Boeing 777-9** aircraft, bringing its total investment to well over **HKD 100 billion**, to strengthen Hong Kong's position as an international aviation hub[18](index=18&type=chunk) [Business Performance](index=7&type=section&id=Chairman%27s%20Statement-Business%20Performance) Business unit performance varied, with Property's recurring underlying profit slightly down, Beverages' recurring profit declining, and Aviation showing strong performance - Property Division: Recurring underlying profit was **HKD 2.829 billion**, a **2%** year-on-year decrease, primarily due to reduced office rental income in Hong Kong[19](index=19&type=chunk) - Beverages Division: Recurring profit was **HKD 0.861 billion**, mainly impacted by weak consumer sentiment and new expenses from capacity enhancement projects in Vietnam and Taiwan[20](index=20&type=chunk) - Aviation Division: Cathay Group's profit was **HKD 3.651 billion**, showing stable performance; HAECO Group's recurring profit increased to **HKD 0.561 billion**, demonstrating strong performance[22](index=22&type=chunk) [Financial Strength and Shareholder Returns](index=8&type=section&id=Chairman%27s%20Statement-Financial%20Strength%20and%20Shareholder%20Returns) The Group maintains a robust financial position with HKD 52.6 billion in available liquidity and a net debt to capital ratio of 22.7% Financial Position as of June 30, 2025 | Indicator | Value | | :--- | :--- | | **Available Liquidity** | HKD 52.6 billion | | **Net Debt to Capital Ratio** | 22.7% | | **Weighted Average Cost of Debt** | 3.7% (lower than end of 2024) | - A first interim dividend of **HKD 1.30** per 'A' share and **HKD 0.26** per 'B' share was declared, representing a **4%** year-on-year increase[23](index=23&type=chunk) - The **HKD 6 billion** share repurchase program has been terminated, with **HKD 1.842 billion** in shares repurchased in H1, bringing the total repurchased under the program to **HKD 5.9 billion**[24](index=24&type=chunk) [Outlook](index=9&type=section&id=Chairman%27s%20Statement-Outlook) The Group anticipates varying opportunities and challenges across its business segments in the future - Swire Properties: The Hong Kong office market is expected to remain weak, but the Mainland China retail market is projected to gradually accelerate development[26](index=26&type=chunk) - Swire Coca-Cola: Weak domestic consumption in Mainland China poses challenges, and some Southeast Asian markets (e.g., Thailand) also face economic and policy pressures[26](index=26&type=chunk) - Cathay Group and HAECO Group: Cathay will continue to invest in fleet expansion, while demand for HAECO's base maintenance and engine overhaul services is expected to remain stable[27](index=27&type=chunk) [Business Review](index=10&type=section&id=Business%20Review) This section provides a detailed review of the performance of the Group's various business divisions [Property Division](index=10&type=section&id=Property%20Division) The Property Division's attributable underlying profit increased to HKD 3.662 billion in H1, boosted by a one-off gain from the sale of Brickell City Centre interests, while recurring underlying profit slightly declined due to a weak Hong Kong office market Property Division H1 2025 Results | Indicator | Amount (HKD million) | Year-on-Year Change | | :--- | :--- | :--- | | **Total Revenue** | 8,723 | +20% | | **Total Operating Profit** | 367 | -89% | | **Profit/(Loss) Attributable to Swire Pacific** | (999) | Turned from profit to loss | | **Underlying Profit Attributable to Swire Pacific** | 3,662 | +17% | | **Recurring Underlying Profit Attributable to Swire Pacific** | 2,829 | -2% | - The increase in attributable underlying profit primarily stemmed from the gain on the sale of Brickell City Centre shopping mall and related land in the USA[39](index=39&type=chunk) - The **HKD 100 billion** investment plan has committed approximately **HKD 67 billion**, with key projects including Hyde Park in Hong Kong, Taikoo Li Xi'an, and Taikoo Source Lujiazui in Shanghai[42](index=42&type=chunk) [Investment Properties](index=15&type=section&id=Property%20Division-Investment%20Properties) Investment property performance varied, with Hong Kong office and retail properties facing challenges, while Mainland China retail properties showed stable performance - Hong Kong office portfolio rental income totaled **HKD 2.455 billion**, a **5%** year-on-year decrease; the office portfolio occupancy rate was **88%** at period-end[48](index=48&type=chunk) - Hong Kong retail property portfolio rental income totaled **HKD 1.169 billion**, a **2%** year-on-year decrease; retail sales at Pacific Place and Cityplaza increased by **1%** and **2%** respectively[49](index=49&type=chunk) - Mainland China retail property rental income increased by **2%** to **HKD 2.272 billion**; retail sales at Taikoo Li Sanlitun in Beijing grew by **7%**, and HKRI Taikoo Hui in Shanghai grew by **14%**[56](index=56&type=chunk)[57](index=57&type=chunk)[59](index=59&type=chunk) [Hotels](index=20&type=section&id=Property%20Division-Hotels) Hotel business performance was mixed, with slower recovery in Hong Kong and varied results in Mainland China, while US-managed hotels performed strongly - Hotels managed by Swire Properties (including restaurants and hotel management offices) recorded a pre-depreciation operating profit of **HKD 25 million** in H1 2025, consistent with H1 2024[72](index=72&type=chunk) - Swire Hotels is expanding its footprint, with plans to open five new hotels in Tokyo, Japan, and Beijing, Shenzhen, Shanghai, and Xi'an in Mainland China[72](index=72&type=chunk) [Property Trading](index=21&type=section&id=Property%20Division-Property%20Trading) Property trading operations are active across Hong Kong, Mainland China, and Southeast Asia - In Hong Kong, **278** out of **432** units at the "The Southside" project in Wong Chuk Hang were sold as of August 1, 2025[76](index=76&type=chunk) - In Shanghai, Mainland China, **105** out of **107** units across two batches of "Taikoo Source Lujiazui Residences" were pre-sold as of August 1, 2025, with cumulative sales reaching **RMB 5.93 billion**[78](index=78&type=chunk)[43](index=43&type=chunk) [Beverages Division](index=24&type=section&id=Beverages%20Division) Swire Coca-Cola's recurring attributable profit for H1 2025 slightly decreased by 2% to HKD 0.861 billion, impacted by weak consumer momentum and new expenses from capacity enhancement projects, while total revenue significantly increased by 25% due to the acquisition of the Thailand business Beverages Division H1 2025 Results | Indicator | Amount (HKD million) | Year-on-Year Change | | :--- | :--- | :--- | | **Revenue** | 21,515 | +25% | | **EBITDA** | 2,525 | +16% | | **Attributable Profit (excluding non-recurring items)** | 861 | -2% | | **Attributable Profit (including non-recurring items)** | 803 | -9% | - Total revenue (including Swire Coca-Cola Shanghai Shenmei) increased by **25%**, and sales volume increased by **20%**, primarily due to the consolidation of TNCC (Thailand business) since October 2024[95](index=95&type=chunk) - By region, Mainland China business profit grew by **8%**, while Hong Kong, Taiwan, Vietnam, and Cambodia businesses all recorded profit declines[89](index=89&type=chunk)[98](index=98&type=chunk)[101](index=101&type=chunk)[103](index=103&type=chunk)[106](index=106&type=chunk) [Mainland China](index=26&type=section&id=Beverages%20Division-Mainland%20China) Mainland China operations recorded an attributable profit of HKD 0.588 billion, an 8% year-on-year increase, driven by a 3% revenue growth and 1% sales volume increase in local currency terms - Attributable profit was **HKD 0.588 billion**, an **8%** year-on-year increase[98](index=98&type=chunk) - Total sales volume increased by **1%**, and revenue in local currency terms increased by **3%**[98](index=98&type=chunk)[99](index=99&type=chunk) [Hong Kong, Taiwan, Southeast Asia](index=27&type=section&id=Beverages%20Division-Hong%20Kong%2C%20Taiwan%2C%20Southeast%20Asia) Hong Kong, Taiwan, and Southeast Asian markets faced challenges, with profit declines in Hong Kong, Taiwan, Vietnam, and Cambodia due to various factors including lower sales, production facility upgrades, and currency depreciation - Hong Kong: Attributable profit decreased by **15%** to **HKD 61 million**[101](index=101&type=chunk) - Taiwan: Attributable profit decreased by **26%** to **HKD 43 million**[103](index=103&type=chunk) - Vietnam and Cambodia: Attributable profit significantly decreased by **31%** to **HKD 113 million**[106](index=106&type=chunk) - Thailand and Laos: Attributable profit, excluding non-recurring items, was **HKD 105 million**, a **13%** year-on-year decrease[108](index=108&type=chunk) [Aviation Division](index=29&type=section&id=Aviation%20Division) The Aviation Division recorded an attributable profit of HKD 2.233 billion in H1 2025, a 7% year-on-year increase, driven by stable performance from Cathay Group and strong growth from HAECO Group due to increased maintenance demand Aviation Division H1 2025 Results | Segment | Attributable Profit (HKD million) | Year-on-Year Change | | :--- | :--- | :--- | | **Cathay Group** | 1,642 | +1% | | **HAECO Group** | 599 | 0% | | **Total Aviation Division** | 2,233 | +7% | [Cathay Group](index=30&type=section&id=Aviation%20Division-Cathay%20Group) Cathay Group delivered stable performance in H1, recording a profit of HKD 3.651 billion, driven by a 14% increase in Cathay Pacific's passenger revenue and a 28% rise in passenger numbers - Cathay Pacific's passenger revenue was **HKD 34.208 billion**, a **14.0%** year-on-year increase; Revenue Passenger Kilometers (RPK) increased by **30.0%**[115](index=115&type=chunk)[119](index=119&type=chunk) - Cathay Cargo revenue was **HKD 11.141 billion**, a **2.2%** year-on-year increase; cargo carried increased by **11.4%**[115](index=115&type=chunk)[121](index=121&type=chunk) - As of June 30, 2025, Cathay Group's fleet totaled **234** aircraft, with an additional **93** aircraft on order[124](index=124&type=chunk)[125](index=125&type=chunk) [Hong Kong Aircraft Engineering Company (HAECO) Group](index=34&type=section&id=Aviation%20Division-Hong%20Kong%20Aircraft%20Engineering%20Company%20%28HAECO%29%20Group) HAECO Group demonstrated strong performance in H1, with recurring attributable profit significantly increasing to HKD 0.561 billion, driven by increased demand for base maintenance and engine overhaul services HAECO Group H1 2025 Results | Indicator | Amount (HKD million) | Year-on-Year Change | | :--- | :--- | :--- | | **Total Revenue** | 11,201 | +7% | | **Attributable Profit (excluding non-recurring items)** | 561 | +40% | | **Attributable Profit (including non-recurring items)** | 599 | 0% | - Base maintenance services recorded **5.26 million** man-hours sold, a **6%** year-on-year increase[134](index=134&type=chunk) - Engine business attributable profit was **HKD 375 million**, a **9%** year-on-year increase, primarily driven by strong demand for engine overhaul services[141](index=141&type=chunk) [Healthcare](index=37&type=section&id=Healthcare) The Healthcare business remains in its early development stage, recording an attributable loss of HKD 0.117 billion in H1 2025, a narrowing from the HKD 0.132 billion loss in the prior period - In H1 2025, the Healthcare business recorded an attributable loss of **HKD 117 million**, a narrowing from the **HKD 132 million** loss in the prior period[151](index=151&type=chunk) - The Group has invested **HKD 3.1 billion** in the healthcare sector (including committed investments) and is actively seeking expansion opportunities in Mainland China and Southeast Asia[152](index=152&type=chunk) [Trading and Industrial](index=38&type=section&id=Trading%20and%20Industrial) The Trading and Industrial business recorded an attributable profit of HKD 41 million in H1, a significant 73% decrease from HKD 152 million in the prior period Trading and Industrial Division H1 2025 Results | Segment | Attributable Profit/(Loss) (HKD million) | Prior Period (HKD million) | | :--- | :--- | :--- | | **Swire Resources** | 17 | 47 | | **Swire Motors** | 37 | 86 | | **Swire Foods** | (16) | 5 | | **Swire Waste Management** | 7 | 22 | | **Total** | 41 | 152 | [Financial Review](index=40&type=section&id=Financial%20Review) This section provides a comprehensive review of the Group's financial performance and position [Underlying Profit and Recurring Underlying Profit](index=40&type=section&id=Underlying%20Profit%20and%20Recurring%20Underlying%20Profit) This section reconciles profit as reported in the financial statements with underlying profit and recurring underlying profit, showing that recurring underlying profit remained largely stable year-on-year Reconciliation of Profit Attributable to Company Shareholders to Underlying Profit (H1 2025) | Item | Amount (HKD million) | | :--- | :--- | | **Profit Attributable to Company Shareholders** | 815 | | Add: Fair value loss on investment properties | 4,674 | | Add: Realized fair value gain on disposal of investment property interests | 1,001 | | Less: Fair value changes attributable to non-controlling interests, etc. | (944) | | Other adjustments | (70) | | **Underlying Profit Attributable to Company Shareholders** | **5,476** | Recurring Underlying Profit by Division (H1 2025) | Division | Amount (HKD million) | | :--- | :--- | | Property | 2,829 | | Beverages | 861 | | Aviation | 2,195 | | Trading and Industrial | 41 | | Head Office, Healthcare and Other | (1,214) | | **Total Recurring Underlying Profit** | **4,712** | [Financing](index=42&type=section&id=Financing) This section details the Group's financing activities, cash flow, and debt position [Cash Flow and Debt Position](index=42&type=section&id=Cash%20Flow%20and%20Debt%20Position) The Group's cash flow from operations significantly increased by 59% to HKD 8.438 billion, with net cash inflow before financing of HKD 6.161 billion, while net debt increased to HKD 71.337 billion - Cash from operations was **HKD 8.438 billion**, a **59%** year-on-year increase; cash before financing turned from a net outflow of **HKD 1.965 billion** in the prior period to a net inflow of **HKD 6.161 billion**[168](index=168&type=chunk) Debt Overview | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Borrowings and Lease Liabilities** | HKD 103.840 billion | HKD 96.612 billion | | **Weighted Average Debt Maturity** | 3.2 years | 2.7 years | | **Weighted Average Cost of Debt** | 3.7% | 4.0% | | **Fixed Rate Debt Proportion** | 66% | 64% | - If net debt of joint ventures and associates is included, the Group's net debt to capital ratio would increase from **22.7%** to **28.8%**[180](index=180&type=chunk) [Condensed Interim Financial Statements](index=48&type=section&id=Condensed%20Interim%20Financial%20Statements) This section presents the Group's condensed interim financial statements for the period [Consolidated Income Statement](index=48&type=section&id=Consolidated%20Income%20Statement) For the six months ended June 30, 2025, the Group recorded revenue of HKD 45.774 billion, a 16% year-on-year increase, but operating profit significantly decreased to HKD 1.861 billion due to a HKD 3.884 billion fair value loss on investment properties, resulting in a 79% decrease in profit attributable to company shareholders [Consolidated Statement of Comprehensive Income](index=49&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Income) Profit for the period was HKD 0.971 billion, and after including other comprehensive income (primarily net exchange differences gain) of HKD 2.668 billion, total comprehensive income for the period was HKD 3.639 billion, with HKD 2.629 billion attributable to company shareholders [Consolidated Statement of Financial Position](index=50&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets were HKD 480.033 billion, total liabilities were HKD 165.943 billion, and net assets (total equity) were HKD 314.090 billion, a slight decrease from HKD 318.667 billion at the end of 2024, with HKD 257.884 billion attributable to company shareholders [Consolidated Cash Flow Statement](index=51&type=section&id=Consolidated%20Cash%20Flow%20Statement) Net cash generated from operating activities was HKD 7.653 billion. Net cash used in investing activities was HKD 1.492 billion, primarily due to HKD 3.908 billion cash inflow from disposal of subsidiaries. Net cash used in financing activities was HKD 1.897 billion, mainly for share repurchases and dividend payments, resulting in an increase in cash and cash equivalents to HKD 24.598 billion at period-end [Consolidated Statement of Changes in Equity](index=52&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Equity) As of January 1, 2025, equity attributable to company shareholders was HKD 258.300 billion, which decreased to HKD 257.884 billion as of June 30, 2025, after accounting for total comprehensive income of HKD 2.629 billion, share repurchases of HKD 1.847 billion, and dividends paid of HKD 2.849 billion [Notes to the Condensed Interim Financial Statements](index=53&type=section&id=Notes%20to%20the%20Condensed%20Interim%20Financial%20Statements) This section provides detailed notes supporting the condensed interim financial statements [Note 1: Segment Information](index=53&type=section&id=Note%201%3A%20Segment%20Information) This note details the revenue, operating profit, assets, and liabilities for the Group's major business segments, including Property, Beverages, Aviation, and Trading and Industrial Company Shareholders' Attributable Underlying Profit by Segment for H1 2025 | Segment | Amount (HKD million) | | :--- | :--- | | Property | 3,662 | | Beverages | 803 | | Aviation | 2,233 | | Trading and Industrial | 41 | | Head Office, Healthcare and Other | (1,263) | | **Total** | **5,476** | [Note 10: Dividends](index=62&type=section&id=Note%2010%3A%20Dividends) The Board of Directors declared a first interim dividend for 2025 of HKD 1.30 per 'A' share and HKD 0.26 per 'B' share, totaling HKD 1.753 billion, payable on October 10, 2025 - A first interim dividend of **HKD 1.30** per 'A' share and **HKD 0.26** per 'B' share was declared[215](index=215&type=chunk)[216](index=216&type=chunk) [Note 13: Investment Properties](index=64&type=section&id=Note%2013%3A%20Investment%20Properties) As of June 30, 2025, the carrying value of the Group's investment properties was HKD 268.861 billion, a decrease from HKD 270.950 billion at the beginning of the year, primarily due to a net fair value loss of HKD 3.884 billion and the impact of disposals and transfers - A net fair value loss on investment properties of **HKD 3.884 billion** was recorded during the period[222](index=222&type=chunk) [Note 25: Share Capital](index=71&type=section&id=Note%2025%3A%20Share%20Capital) During the period, the company repurchased and cancelled 25,119,000 'A' shares and 15,402,500 'B' shares on the Stock Exchange under its share repurchase program, for a total consideration of HKD 1.842 billion - In H1, **25,119,000** 'A' shares and **15,402,500** 'B' shares were repurchased for a total of **HKD 1.842 billion**[241](index=241&type=chunk) [Additional Information](index=77&type=section&id=Additional%20Information) This section provides supplementary information relevant to the report [Major Shareholders](index=79&type=section&id=Major%20Shareholders) As of June 30, 2025, John Swire & Sons Limited held 56.85% of the company's 'A' shares and 74.83% of its 'B' shares, collectively owning 64.45% of the share capital and 70.97% of the voting rights - John Swire & Sons Limited holds **64.45%** of the company's share capital and controls **70.97%** of the voting rights[267](index=267&type=chunk)

[Financial Summary](index=3&type=section&id=Financial%20Summary) Swire Properties reported a financial summary for the first half of 2025, with revenue increasing by 20% year-on-year, underlying profit growing by 15%, but recurring underlying profit decreasing by 4%. Dividend per share increased by 3%, and the net debt-to-capital ratio remained stable Key Financial Data for H1 2025 | Metric | 2025 (HKD million) | 2024 (HKD million) | Change | | :--- | :--- | :--- | :--- | | Revenue | 8,723 | 7,279 | +20% | | Profit Attributable to Company Shareholders (Underlying) | 4,420 | 3,857 | +15% | | Profit Attributable to Company Shareholders (Recurring Underlying) | 3,420 | 3,570 | -4% | | Reported (Loss)/Profit | (1,202) | 1,796 | N/A | | Cash from Operations | 6,103 | 3,701 | +65% | | Net Cash Inflow Before Financing | 6,683 | 1,284 | +420% | | Earnings Per Share (Underlying) | 0.76 | 0.66 | +15% | | Earnings Per Share (Recurring Underlying) | 0.59 | 0.61 | -3% | | Dividend Per Share (First Interim) | 0.35 | 0.34 | +3% | | Total Equity (Period End) | 272,547 | 278,427 | -2% | | Net Debt (Period End) | 42,853 | 43,746 | -2% | | Net Debt-to-Capital Ratio (Period End) | 15.7% | 15.7% | 0 percentage points | | Equity Per Share Attributable to Company Shareholders (Period End) | 47.01 | 47.35 | -1% | Underlying Profit/(Loss) by Segment | Segment | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Property Investment | 3,747 | 3,693 | | Property Trading | (282) | (61) | | Hotels | (45) | (62) | | Recurring Underlying Profit | 3,420 | 3,570 | | Disposal of Assets | 1,000 | 287 | | Underlying Profit | 4,420 | 3,857 | [Chairman's Statement](index=4&type=section&id=Chairman's%20Statement) Despite global economic uncertainties, Swire Properties demonstrated strong performance through its quality property portfolio and community-building strategy, continuing its HKD 100 billion investment plan and strengthening financial resilience through capital recycling to high-growth core markets, while committing to progressive dividend growth and achieving 2030 sustainability targets ahead of schedule [Financial Performance Summary](index=4&type=section&id=Financial%20Performance%20Summary) Underlying profit increased by 15% to HKD 4.42 billion in H1 2025, driven by the disposal of interests in Brickell City Centre, while recurring underlying profit decreased by 4% due to lower Hong Kong office rental income and increased residential sales promotion expenses, resulting in a reported loss of HKD 1.202 billion primarily from investment property fair value losses - H1 2025 underlying profit increased by **15% to HKD 4.42 billion**, primarily due to the disposal of interests in Brickell City Centre mall, car parks, and adjacent land[8](index=8&type=chunk) - Recurring underlying profit attributable to shareholders decreased by **4%**, from HKD 3.57 billion in H1 2024 to **HKD 3.42 billion** in H1 2025, mainly due to lower Hong Kong office rental income and increased sales promotion expenses for residential trading projects[8](index=8&type=chunk) - H1 2025 recorded a reported loss attributable to shareholders of **HKD 1.202 billion**, compared to a profit of HKD 1.796 billion in the same period of 2024, primarily due to fair value losses on investment properties of **HKD 4.68 billion** (HKD 879 million in H1 2024)[8](index=8&type=chunk) [Progressive Dividend Growth and Share Buyback](index=4&type=section&id=Progressive%20Dividend%20Growth%20and%20Share%20Buyback) The company declared a first interim dividend of HKD 0.35 per share for 2025, a 3% year-on-year increase, aiming for mid-single-digit annual dividend growth and distributing approximately half of its underlying profit as ordinary dividends, having completed HKD 707 million of its HKD 1.5 billion share buyback program - The first interim dividend for 2025 is **HKD 0.35 per share**, a **3% increase** compared to 2024[9](index=9&type=chunk) - The company aims for mid-single-digit annual dividend growth and plans to distribute approximately **half of its underlying profit** as ordinary dividends in the future[9](index=9&type=chunk) - As of the Annual General Meeting in May 2025, the company had repurchased **44,736,600 shares** for a cash consideration of **HKD 707 million**, at an average price of **HKD 15.8 per share**[9](index=9&type=chunk) [Driving Business Growth in Key Markets](index=5&type=section&id=Driving%20Business%20Growth%20in%20Key%20Markets) The company is steadfastly executing its investment strategy, focusing on Hong Kong, mainland China, and Southeast Asia, expanding in mainland China with new projects in Shanghai, Beijing, Sanya, Xi'an, and the Greater Bay Area, maintaining solid performance in Hong Kong's office and retail sectors with an improving residential market, and making steady progress in Southeast Asia with projects in Bangkok and Jakarta - The company continues to advance its **HKD 100 billion investment plan**, with **67% of funds already committed**, focusing on expanding in Hong Kong, mainland China, and Southeast Asia[7](index=7&type=chunk) - In mainland China, the company is expanding its business through Shanghai Taikoo Li Lujiazui and the Qianhai Taikoo Li expansion project, and developing new projects in Beijing, Sanya, Xi'an, and the Greater Bay Area, demonstrating confidence in mainland China's long-term prospects[10](index=10&type=chunk)[11](index=11&type=chunk) - Hong Kong's office property portfolio shows solid performance, retail business is encouraging, and the residential market sentiment is improving, with the company well-prepared to capture market demand[11](index=11&type=chunk)[12](index=12&type=chunk) - In Southeast Asia, construction has begun on a prime luxury residential project in Bangkok, and Savyavasa sales in Jakarta are steady, reflecting successful business expansion strategies in the region[12](index=12&type=chunk) [Looking Ahead](index=5&type=section&id=Looking%20Ahead) Looking ahead to H2 2025 and beyond, the company will remain agile and prudent, focusing on strategy execution, confident in its quality property portfolio, professional team, and clear long-term vision despite anticipated external challenges - The company will continue to remain agile and prudent, focusing on executing its established strategies, confident in its quality property portfolio, professional team, and clear long-term vision[13](index=13&type=chunk) [Chief Executive's Report](index=6&type=section&id=Chief%20Executive's%20Report) Despite a challenging operating environment, Swire Properties continues to demonstrate solid performance through its focus on quality, innovation, and long-term planning, steadily advancing its HKD 100 billion investment plan and strengthening its property portfolio through asset disposals, while making significant progress in sustainability, innovation, and community engagement [Performance Review](index=6&type=section&id=Performance%20Review) In H1 2025, recurring underlying pre-tax profit from investment properties decreased due to lower Hong Kong office rental income, though occupancy remained stable. Hong Kong retail softened, but mall occupancy and footfall remained high. Mainland China retail sales stabilized with increased footfall. Residential presales were strong for Shanghai Taikoo Li Lujiazui and Jakarta Savyavasa. Hotel recovery was slow, but EAST Miami performed well - In H1 2025, recurring underlying pre-tax profit from investment properties decreased, mainly due to lower Hong Kong office rental income, but the office property portfolio occupancy rate remained stable[16](index=16&type=chunk) - Hong Kong's retail market softened, but Swire Properties' malls maintained high occupancy rates and footfall, benefiting from tenant mix optimization and marketing activities[16](index=16&type=chunk) - Mainland China's retail sales stabilized, with overall footfall continuing to increase, and both batches of presale units for Shanghai Taikoo Li Lujiazui Residences received excellent responses[17](index=17&type=chunk) - In Southeast Asia, Savyavasa in Jakarta has presold over **40% of its saleable area**, reflecting strong demand for high-end residential properties in the region[18](index=18&type=chunk) [Asset Disposals to Strengthen Property Portfolio](index=7&type=section&id=Asset%20Disposals%20to%20Strengthen%20Property%20Portfolio) The company successfully implemented its capital recycling strategy, completing the disposal of its interests in Brickell City Centre mall, car parks, and adjacent vacant land in Miami for approximately USD 760 million in Q2 2025, with proceeds reinvested into the HKD 100 billion investment plan to support growth opportunities in core markets, including the planned Mandarin Oriental Residences Miami project - In Q2 2025, the company completed the disposal of its interests in Brickell City Centre mall, car parks, and adjacent vacant land in Miami for approximately **USD 760 million**[19](index=19&type=chunk) - Proceeds from the disposal will be reinvested into the **HKD 100 billion investment plan** to support growth opportunities in core markets, including the development of residential trading projects such as the Mandarin Oriental Residences Miami[19](index=19&type=chunk) [Future Outlook](index=7&type=section&id=Future%20Outlook) The company will continue to advance its HKD 100 billion investment plan, anticipating sustained weakness in Hong Kong office demand but benefiting from the flight-to-quality trend, cautious Hong Kong retail sentiment with stable mall footfall, solid mainland China retail sales driven by luxury and rising demand for quality retail space, an improving Hong Kong residential market in the medium to long term, strong demand for prime residential in mainland China's tier-one cities, and robust luxury residential markets in Southeast Asia and Miami, with hotel management expanding into Asia Pacific - Hong Kong office demand is expected to remain soft, but Pacific Place and Taikoo Place, with their integrated development advantages, are well-positioned to attract tenants seeking high-specification, sustainably certified premium office space[20](index=20&type=chunk) - Mainland China's retail sales performance is solid, with luxury retail being a key growth driver and an increasing demand for quality retail space, particularly for fashion, lifestyle, leisure, and sports brands[21](index=21&type=chunk) - Hong Kong's residential trading portfolio is expected to benefit from improved market sentiment and favorable policies, with several new residential developments attracting attention, and residential prices and demand improving in the medium to long term[22](index=22&type=chunk) - Urbanization, a growing middle class, and limited supply continue to support demand for luxury residential properties in Southeast Asia, with markets like Jakarta, Ho Chi Minh City, and Bangkok expected to become more vibrant[23](index=23&type=chunk) - The company's hotel portfolio is expanding, with five new projects confirmed for development under third-party management contracts in Tokyo, Beijing, Shenzhen, Shanghai, and Xi'an[23](index=23&type=chunk) [Sustainability, Innovation, and Community Engagement](index=8&type=section&id=Sustainability,%20Innovation,%20and%20Community%20Engagement) The company achieved its 2030 sustainability goals ahead of schedule and is now developing its 2050 vision, focusing on community building, innovation, and strategic partnerships, actively expanding its corporate volunteer team, raising over HKD 1.37 million through its annual "Books for Love" charity sale, and advancing digital transformation through its Innovation Accelerator program and generative AI projects - The company achieved its 2030 sustainability goals ahead of schedule and is now developing its 2050 sustainability vision, focusing on community building, innovation, and strategic partnerships[25](index=25&type=chunk) - The annual "Books for Love" charity sale mobilized over **7,000 volunteers** and raised over **HKD 1.37 million** to support local charitable initiatives[26](index=26&type=chunk) - The company actively trains its teams through the Innovation Accelerator program and digital training courses, and has launched multiple generative AI projects to accelerate digital transformation[27](index=27&type=chunk) [Future Outlook](index=8&type=section&id=Future%20Outlook) Despite a challenging H1 2025, the company's team delivered solid business performance in core markets, successfully advanced its HKD 100 billion investment plan, and strengthened its community building and sustainability vision, remaining confident in future opportunities and committed to creating long-term value for stakeholders - The company's team delivered solid business performance in core markets amidst a challenging environment, successfully advancing key projects under the **HKD 100 billion investment plan**[28](index=28&type=chunk) - Looking ahead to H2 2025, the company is confident in its quality property portfolio and its ability to realize future opportunities, continuing to create long-term value for stakeholders[28](index=28&type=chunk) [Business Review](index=10&type=section&id=Business%20Review) This chapter provides a detailed review of Swire Properties' business segments, including property investment, property trading, and hotels, covering portfolio overviews, market outlooks, capital commitments, and key business developments in Hong Kong, mainland China, and the US, along with detailed financial reconciliation and property valuation information [Reconciliation of Underlying Profit](index=11&type=section&id=Reconciliation%20of%20Underlying%20Profit) This section reconciles reported (loss)/profit attributable to company shareholders with underlying profit, with key adjustments including fair value changes of investment properties, related deferred tax, and realized fair value gains on disposal of investment property interests. In H1 2025, the Group recorded fair value losses of HKD 4.382 billion and HKD 308 million for investment properties in Hong Kong and mainland China, respectively Reconciliation of Underlying Profit (Six Months Ended June 30) | Metric | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Reported (Loss)/Profit Attributable to Company Shareholders | (1,202) | 1,796 | | Fair Value Loss on Investment Properties | 4,690 | 831 | | Deferred Tax on Investment Properties | (44) | 660 | | Realized Fair Value Gain on Disposal of Investment Property Interests | 1,001 | 527 | | Underlying Profit Attributable to Company Shareholders | 4,420 | 3,857 | | Recurring Underlying Profit Attributable to Company Shareholders | 3,420 | 3,570 | - In H1 2025, the Group recorded fair value losses of **HKD 4.382 billion** and **HKD 308 million** for investment properties in Hong Kong and mainland China, respectively[32](index=32&type=chunk) [Underlying Profit](index=12&type=section&id=Underlying%20Profit) In H1 2025, underlying profit attributable to company shareholders increased by HKD 563 million to HKD 4.42 billion, primarily driven by profit from the disposal of interests in Brickell City Centre mall in the US, partially offset by reduced Hong Kong office rental income and increased sales promotion expenses for residential trading projects. Recurring underlying profit was HKD 3.42 billion, lower than the same period last year Change in Underlying Profit (HKD million) | Change Item | Amount | | :--- | :--- | | H1 2024 Underlying Profit | 3,857 | | Increase in Profit from Asset Disposals | 713 | | Increase in Profit from Property Investment | 54 | | Increase in Loss from Property Trading | (221) | | Decrease in Loss from Hotels | 17 | | H1 2025 Underlying Profit | 4,420 | - In H1 2025, underlying profit attributable to shareholders increased by **HKD 563 million to HKD 4.42 billion**, primarily reflecting profit generated from the disposal of interests in Brickell City Centre mall in the US[37](index=37&type=chunk) - Recurring underlying profit (excluding profit from asset disposals) was **HKD 3.42 billion**, a decrease from HKD 3.57 billion in H1 2024, mainly due to reduced Hong Kong office rental income[37](index=37&type=chunk)[38](index=38&type=chunk) - The underlying loss from property trading primarily stemmed from increased sales and marketing expenses for several residential trading projects, particularly those planned for launch in Hong Kong and the US in the coming years[39](index=39&type=chunk) [HKD 100 Billion Investment Plan](index=13&type=section&id=HKD%20100%20Billion%20Investment%20Plan) The company plans to invest HKD 100 billion over the next decade, with HKD 30 billion allocated to Hong Kong, HKD 50 billion to mainland China, and HKD 20 billion to residential trading projects (including Southeast Asia). As of August 1, 2025, total committed investments are approximately HKD 67 billion, focusing on residential, retail, and office developments in Hong Kong, mainland China, and Southeast Asia - The company plans to invest **HKD 100 billion** over the next decade, targeting **HKD 30 billion** in Hong Kong, **HKD 50 billion** in mainland China, and **HKD 20 billion** in residential trading projects (including Southeast Asia)[41](index=41&type=chunk) - As of August 1, 2025, the total committed investment plan is approximately **HKD 67 billion** (HKD 11 billion in Hong Kong, HKD 46 billion in mainland China, and HKD 10 billion in residential property trading projects)[41](index=41&type=chunk) - Key projects include residential developments such as Hyde Park and 269 Queen's Road East in Hong Kong; and retail and mixed-use developments in mainland China such as Taikoo Li Xi'an, Sanya retail project, Shanghai Taikoo Li Lujiazui, and the Qianhai mixed-use development[41](index=41&type=chunk) [Key Business Developments](index=14&type=section&id=Key%20Business%20Developments) This section outlines the company's major property acquisition and disposal activities in H1 2025, including increasing its interest in Brickell City Centre mall in Miami to 75%, followed by the completion of the sale of that 75% interest and adjacent land. Additionally, the second batch of units at Shanghai Taikoo Li Lujiazui Residences saw strong presales, and the company acquired a 25% interest in the Mandarin Oriental Miami joint venture, increasing its stake to 100% - In April 2025, the Group acquired a **12.07% interest** in Brickell City Centre mall in Miami for **USD 73.5 million**, increasing its stake to **75%**[42](index=42&type=chunk) - In June 2025, the Group completed the disposal of its **75% interest** in Brickell City Centre mall and car parks to Simon Property Group for a total consideration of up to **USD 548.7 million**[43](index=43&type=chunk) - **55 out of 57 units** in the second batch of presales for Shanghai Taikoo Li Lujiazui Residences were presold, with total presale revenue from both batches reaching **RMB 5.93 billion**[42](index=42&type=chunk) - In June 2025, the Group acquired a **25% interest** in the Mandarin Oriental Miami joint venture for **USD 37 million**, increasing its stake to **100%**, with the hotel having closed in May for redevelopment[44](index=44&type=chunk) [Property Portfolio Overview](index=15&type=section&id=Property%20Portfolio%20Overview) As of June 30, 2025, the Group's attributable total floor area was approximately 39 million sq ft, with investment properties and hotels accounting for approximately 33.4 million sq ft (23.8 million sq ft completed, 9.6 million sq ft under development). The Hong Kong investment property and hotel portfolio was approximately 14.5 million sq ft, and mainland China approximately 18.9 million sq ft (10.4 million sq ft completed). The trading property portfolio includes completed units in Hong Kong and 8 residential projects under development, with plans for luxury residential and hotel projects in Miami - As of June 30, 2025, the Group's attributable total floor area was approximately **39 million sq ft**[46](index=46&type=chunk) - The total floor area for investment properties and hotels was approximately **33.4 million sq ft**, of which approximately **23.8 million sq ft** was completed, and approximately **9.6 million sq ft** was under development or held for future development[47](index=47&type=chunk) Completed Investment Properties and Hotels (Attributable Total Floor Area, in million sq ft) | | Office | Retail Properties | Hotels | Residential/Serviced Apartments | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | Hong Kong | 9.4 | 2.6 | 0.8 | 0.6 | 13.4 | | Mainland China | 2.9 | 6.2 | 1.1 | 0.2 | 10.4 | | Total | 12.3 | 8.8 | 1.9 | 0.8 | 23.8 | Investment Properties and Hotels Under Development or Held for Future Development (Estimated Attributable Total Floor Area, in million sq ft) | | Office | Retail Properties | Hotels | Residential/Serviced Apartments | Planned | Total | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Hong Kong | - | - | - | - | 1.1 | 1.1 | | Mainland China | 2.2 | 3.5 | 0.2 | 0.1 | 2.5 | 8.5 | | Total | 2.2 | 3.5 | 0.2 | 0.1 | 3.6 | 9.6 | Trading Properties (Attributable Total Floor Area, in million sq ft) | | Completed | Under Development or Held for Development | Total | | :--- | :--- | :--- | :--- | | Hong Kong | 0.1 | 1.0 | 1.1 | | Mainland China | - | 1.0 | 1.0 | | US and Other Regions | - | 3.5 | 3.5 | | Total | 0.1 | 5.5 | 5.6 | [Investment Properties — Hong Kong](index=17&type=section&id=Investment%20Properties%20—%20Hong%20Kong) The Hong Kong investment property portfolio includes office, retail, and residential properties. Office rental income decreased by 5% with an occupancy rate of 88%. Retail property rental income decreased by 2%, but mall occupancy was nearly 100%. Residential property occupancy was approximately 73%. Several investment property projects under development are progressing, including the redevelopment of Wah Ha Factory Building and Warwick House, and the phased disposal of office floors at One Island East [Office](index=17&type=section&id=Office) Hong Kong's completed office property portfolio has a total floor area of approximately 10 million sq ft, with attributable rental income totaling HKD 2.6 billion in H1 2025, a 5% decrease from the same period last year. Despite high market vacancy rates and pressure from new supply, the office portfolio's occupancy rate remained largely stable at 88% - Hong Kong's completed office property portfolio has a total floor area of approximately **10 million sq ft**, with attributable rental income totaling **HKD 2.6 billion** in H1 2025[55](index=55&type=chunk) - The total rental income for the Hong Kong office property portfolio in H1 2025 was **HKD 2.455 billion**, a **5% decrease** from the same period in 2024[57](index=57&type=chunk) - As of June 30, 2025, the office property portfolio's occupancy rate was **88%**. Excluding Two Taikoo Place and Six Pacific Place, the occupancy rate for the remaining office property portfolio was **91%**[57](index=57&type=chunk) Hong Kong Office Lease Expiry Profile (as at June 30, 2025) | Period | Percentage of Attributable Gross Rental Income | | :--- | :--- | | July to December 2025 | 3.6% | | 2026 | 11.9% | | 2027 and Thereafter | 84.5% | [Retail](index=19&type=section&id=Retail) Hong Kong's completed retail property portfolio has a total floor area of approximately 3.2 million sq ft, with attributable gross rental income decreasing by 2% to HKD 1.263 billion in H1 2025. Despite economic uncertainty and changing consumer habits, mall occupancy remained close to 100%. Retail sales at Pacific Place Shopping Mall and Cityplaza increased by 1% and 2% respectively, while Citygate Outlets decreased by 3% - Hong Kong's completed retail property portfolio has a total floor area of approximately **3.2 million sq ft**, with attributable gross rental income decreasing by **2% to HKD 1.263 billion** in H1 2025[63](index=63&type=chunk) - In H1 2025, retail sales at Pacific Place Shopping Mall and Cityplaza increased by **1% and 2%**, respectively, while Citygate Outlets decreased by **3%**[65](index=65&type=chunk) - During the period, the malls were almost fully leased, with occupancy rates close to **100%**[66](index=66&type=chunk) Hong Kong Retail Lease Expiry Profile (as at June 30, 2025) | Period | Percentage of Attributable Gross Rental Income | | :--- | :--- | | July to December 2025 | 8.5% | | 2026 | 27.8% | | 2027 and Thereafter | 63.7% | [Residential Properties](index=20&type=section&id=Residential%20Properties) Hong Kong's completed residential property portfolio has a total floor area of approximately 600,000 sq ft, including The Upper House and EAST Residences. As of June 30, 2025, the residential property portfolio's occupancy rate was approximately 73%, with stable demand driven by local residents and interest from mainland China and overseas markets - Hong Kong's completed residential property portfolio has a total floor area of approximately **600,000 sq ft**, with an occupancy rate of approximately **73%** as of June 30, 2025[71](index=71&type=chunk) - Demand for the Group's residential investment properties remains stable, primarily driven by increasing interest from local residents and individuals from mainland China and overseas markets[71](index=71&type=chunk) [Investment Properties Under Development](index=21&type=section&id=Investment%20Properties%20Under%20Development) Several Hong Kong investment property projects under development are progressing, including the redevelopment of Wah Ha Factory Building (8 Shipyard Lane) and Warwick House (1067 King's Road), which are expected to provide approximately 779,000 sq ft of office and other commercial uses. Additionally, the phased disposal of certain office floors at One Island East is underway, anticipated to be completed between 2025 and 2028 - Wah Ha Factory Building and Warwick House are planned for redevelopment into office and other commercial uses, with a total floor area of approximately **779,000 sq ft**[72](index=72&type=chunk) - The disposal of **12 office floors** (approximately **300,000 sq ft**) at One Island East is being conducted in phases, with the sale of the 43rd floor expected to be completed by December 31, 2025[74](index=74&type=chunk) [Investment Properties — Mainland China](index=22&type=section&id=Investment%20Properties%20—%20Mainland%20China) The mainland China property portfolio has a total floor area of approximately 30.2 million sq ft, with the Group's attributable share being 18.9 million sq ft. In H1 2025, attributable gross rental income was HKD 3.073 billion, similar to the previous year. Retail property rental income slightly increased, with sales outperforming the market. Office rental income decreased by 3% due to weak market demand. Serviced apartment performance varied, expected to remain stable in H2. Several large-scale mixed-use developments are progressing [Overview](index=22&type=section&id=Overview) The mainland China property portfolio has a total floor area of approximately 30.2 million sq ft, with the Group's attributable interest being 18.9 million sq ft (14 million sq ft completed, 16.2 million sq ft under development). In H1 2025, attributable gross rental income was HKD 3.073 billion, similar to the same period last year. As of June 30, 2025, the valuation of mainland China investment properties was HKD 129.686 billion - The mainland China property portfolio has a total floor area of approximately **30.2 million sq ft**, with the Group's attributable interest being **18.9 million sq ft**, of which **14 million sq ft** is completed and **16.2 million sq ft** is under development[75](index=75&type=chunk) - In H1 2025, attributable gross rental income from mainland China investment properties was **HKD 3.073 billion**, similar to H1 2024[75](index=75&type=chunk) - As of June 30, 2025, the valuation of mainland China investment properties was **HKD 129.686 billion**, with the Group's attributable interest being **HKD 92.517 billion**[75](index=75&type=chunk) [Retail](index=23&type=section&id=Retail) Mainland China's completed retail property portfolio has a total floor area of approximately 7.8 million sq ft, with attributable gross rental income slightly increasing in H1 2025. Despite some malls being affected by upgrade works, retail sales remained stable and robust, with overall footfall continuing to increase, benefiting from government stimulus measures and recovering consumer confidence. The Group's attributable retail sales in mainland China increased by 1%, outperforming the market - Mainland China's completed retail property portfolio has a total floor area of approximately **7.8 million sq ft**, with attributable gross rental income slightly increasing in H1 2025[79](index=79&type=chunk) - In H1 2025, the Group's attributable retail sales in mainland China (excluding auto retailers) increased by **1%**, outperforming the market and **70% higher** than the same period in 2019[81](index=81&type=chunk) - Retail sales at Taikoo Li Sanlitun Beijing, HKRI Taikoo Hui Shanghai, and Taikoo Li Qianhai increased by **7%, 14%, and 4%**, respectively[81](index=81&type=chunk) Mainland China Retail Lease Expiry Profile (as at June 30, 2025) | Period | Percentage of Attributable Gross Rental Income | | :--- | :--- | | July to December 2025 | 15.3% | | 2026 | 30.1% | | 2027 and Thereafter | 54.6% | [Office](index=26&type=section&id=Office) Mainland China's completed office property portfolio has a total floor area of approximately 4.2 million sq ft, with attributable gross rental income decreasing by 3% to HKD 412 million in H1 2025. Office demand in Beijing, Shanghai, and Guangzhou remained weak, with new supply in Guangzhou and Shanghai leading to high vacancy rates. The Group's office portfolio, however, effectively capitalized on the trend of tenants seeking quality office space - Mainland China's completed office property portfolio has a total floor area of approximately **4.2 million sq ft**, with attributable gross rental income decreasing by **3% to HKD 412 million** in H1 2025[91](index=91&type=chunk) - Office demand in Beijing, Shanghai, and Guangzhou remained weak, with new supply in Guangzhou and Shanghai leading to high vacancy rates[92](index=92&type=chunk) Mainland China Office Lease Expiry Profile (as at June 30, 2025) | Period | Percentage of Attributable Gross Rental Income | | :--- | :--- | | July to December 2025 | 6.2% | | 2026 | 18.4% | | 2027 and Thereafter | 75.4% | [Serviced Apartments](index=27&type=section&id=Serviced%20Apartments) Serviced apartment units are available at Mandarin Oriental Guangzhou, The Temple House Chengdu, and The Middle House Shanghai. In H1 2025, serviced apartment performance varied, with occupancy rates of 79%, 43%, and 82% respectively. Performance is expected to remain stable in H2 2025 - Serviced apartment occupancy rates at Mandarin Oriental Guangzhou, The Temple House Chengdu, and The Middle House Shanghai were **79%, 43%, and 82%**, respectively[97](index=97&type=chunk) - Serviced apartment performance is expected to remain stable in H2 2025[98](index=98&type=chunk) [Investment Properties Under Development](index=28&type=section&id=Investment%20Properties%20Under%20Development) Several large-scale mixed-use developments are progressing in mainland China, including Taikoo Place Beijing (office-led, phased completion from mid-2026), Taikoo Li Xi'an (retail-led, phased completion from 2027), Taikoo Li Sanya (resort-style luxury retail, phased completion from 2026), Shanghai Qianhai mixed-use development (expected completion 2026), Shanghai Taikoo Li Lujiazui (phased completion from 2026, strong residential presales), Guangzhou Julong Bay project (phased completion from H1 2027), and 387 Tianhe Road Guangzhou (Taikoo Hui expansion, renovation completion from 2027) - Taikoo Place Beijing is an office-led mixed-use development with a total floor area of approximately **4 million sq ft**, expected to be completed in two phases from mid-2026[99](index=99&type=chunk) - Taikoo Li Xi'an is expected to be developed as a retail-led mixed-use development with an estimated total floor area of approximately **2.9 million sq ft**, with phased completion from 2027[100](index=100&type=chunk) - Shanghai Taikoo Li Lujiazui will be developed into a mixed-use landmark comprising luxury residences, retail, office, and cultural facilities, with phased completion from 2026, and **105 units** sold from the first and second batches of residential presales[103](index=103&type=chunk) Estimated Attributable Floor Area of Completed Mainland China Property Portfolio (sq ft) | Project | June & December 2025 | December 2026 | December 2027 | Post-2027 | | :--- | :--- | :--- | :--- | :--- | | Taikoo Li Sanlitun Beijing | 1,618,801 | 1,764,059 | 1,764,059 | 1,764,059 | | Taikoo Li Chengdu | 1,654,565 | 1,654,565 | 1,654,565 | 1,654,565 | | Taikoo Hui Guangzhou | 3,668,857 | 3,668,857 | 3,668,857 | 3,668,857 | | INDIGO Beijing | 947,072 | 947,072 | 947,072 | 947,072 | | HKRI Taikoo Hui Shanghai | 1,865,984 | 1,865,984 | 1,865,984 | 1,865,984 | | Taikoo Li Qianhai Shanghai | 594,364 | 594,364 | 594,364 | 594,364 | | Taikoo Place Beijing | - | 1,109,818 | 2,018,509 | 2,018,509 | | Taikoo Li Xi'an | - | - | 1,269,621 | 2,027,283 | | Taikoo Li Sanya | - | 291,832 | 1,147,237 | 1,147,237 | | Shanghai Qianhai Mixed-Use Development | - | 1,177,513 | 1,177,513 | 1,177,513 | | Shanghai Taikoo Li Lujiazui | - | 93,229 | 1,154,581 | 1,154,581 | | Guangzhou Julong Bay Taikoo Li | - | - | 58,928 | 175,873 | | 387 Tianhe Road Guangzhou | - | - | 635,139 | 635,139 | | Guangzhou Hui Fang | 90,847 | 90,847 | 90,847 | 90,847 | | Others | 2,917 | 2,917 | 2,917 | 2,917 | | Total | 10,443,407 | 13,261,057 | 18,050,193 | 18,924,800 | [Investment Properties — US](index=31&type=section&id=Investment%20Properties%20—%20US) This section primarily outlines the development and disposal of the Brickell City Centre project in Miami. The Group increased its interest in the mall to 75% in January 2025, subsequently completing the sale of that 75% interest and adjacent land in June. Prior to the sale, retail sales and gross rental income increased by 4% and 7% respectively compared to the same period last year - In January 2025, the Group increased its interest in Brickell City Centre mall in Miami to **75%**[111](index=111&type=chunk) - In June 2025, the Group completed the disposal of its **75% interest** in the mall, car parks, and certain common facilities for a total consideration of up to **USD 548.7 million**[112](index=112&type=chunk) - Prior to the disposal of the mall at the end of June 2025, retail sales and gross rental income increased by **4% and 7%**, respectively, compared to the same period in 2024[112](index=112&type=chunk) [Investment Property Valuation](index=32&type=section&id=Investment%20Property%20Valuation) The Group's investment property portfolio was valued at HKD 269.418 billion as of June 30, 2025, a decrease from HKD 271.502 billion as of December 31, 2024. This decline primarily reflects fair value losses on Hong Kong office investment properties, disposals of investment properties, and transfers to assets held for sale, partially offset by additional acquisitions and exchange gains on mainland China investment properties - The Group's investment property portfolio was valued at **HKD 269.418 billion** as of June 30, 2025, a decrease from **HKD 271.502 billion** as of December 31, 2024[113](index=113&type=chunk) - The decrease in valuation primarily reflects fair value losses on Hong Kong office investment properties, disposals of investment properties, and transfers of investment properties to assets classified as held for sale[113](index=113&type=chunk) [Property Trading](index=33&type=section&id=Property%20Trading) The property trading portfolio includes completed units in Hong Kong (EIGHT STAR STREET, The Southern Skies, 6 Deep Water Bay Road) and 8 residential projects under development, with plans for luxury residential and hotel projects in Miami. Hong Kong residential sales are gradually increasing, with medium to long-term demand expected to improve. The high-end residential market in mainland China's tier-one cities is expected to remain strong in the short term. Prospects for luxury residential markets in Southeast Asia and the US are robust [Overview](index=33&type=section&id=Overview) The property trading portfolio includes completed units available for sale in Hong Kong, as well as 8 residential projects under development (3 in Hong Kong, 2 in mainland China, 1 in Indonesia, 1 in Vietnam, and 1 in Thailand). Additionally, the Group plans to develop a luxury residential project on Brickell Key in Miami, USA - The property trading portfolio includes completed units available for sale at EIGHT STAR STREET, The Southern Skies, and 6 Deep Water Bay Road in Hong Kong[114](index=114&type=chunk) - There are **8 residential projects** under development across Hong Kong, mainland China, Indonesia, Vietnam, and Thailand, with plans to develop a luxury residential project on Brickell Key in Miami, USA[114](index=114&type=chunk) [Hong Kong](index=34&type=section&id=Hong%20Kong) Hong Kong property trading projects include EIGHT STAR STREET in Wan Chai (35 of 37 units sold), The Southern Skies in Wong Chuk Hang (278 of 800 units sold), 6 Deep Water Bay Road (occupation permits obtained for two detached houses), Hyde Park in Chai Wan (expected completion from 2025), 269 Queen's Road East in Wan Chai (expected completion 2026), and 983-987A King's Road and 16-94 Marina Street in Quarry Bay (expected completion 2028). Hong Kong residential sales are gradually increasing, with medium to long-term demand expected to improve - Of the **37 units** at EIGHT STAR STREET in Wan Chai, **35** had been sold as of August 1, 2025[117](index=117&type=chunk) - Of the **800 residential units** at The Southern Skies in Wong Chuk Hang, **278** had been sold as of August 1, 2025, with sales of **184 units** recognized in H1 2025[118](index=118&type=chunk) - Hong Kong residential sales volumes are gradually increasing, with medium to long-term residential demand expected to improve, supported by increased demand from local and mainland Chinese buyers[123](index=123&type=chunk) [Mainland China](index=35&type=section&id=Mainland%20China) The Group holds a 40% interest in two new landmark projects in Shanghai Pudong New Area (Shanghai Qianhai mixed-use development and Taikoo Li Lujiazui). Approximately 97% of the total saleable area of Shanghai Century Qianhai Tianyu and Tianhui residential towers has been presold, with completion expected in 2026. Of the 107 presale units in two batches at Shanghai Taikoo Li Lujiazui Residences, 105 have been sold. The high-end residential market in mainland China's tier-one cities is expected to remain strong in the short term, with robust prospects for luxury residential markets in Beijing and Shanghai - Approximately **97% of the total saleable area** of Shanghai Century Qianhai Tianyu and Tianhui residential towers has been presold, with completion expected in 2026[125](index=125&type=chunk) - Of the **107 presale units** in two batches at Shanghai Taikoo Li Lujiazui Residences, **105** have been sold, with the project expected to be completed from 2026[126](index=126&type=chunk) - The high-end residential market in prime locations of mainland China's tier-one cities is expected to remain strong in the short term, with excellent sales performance for premium projects in Shanghai[127](index=127&type=chunk) [Indonesia](index=35&type=section&id=Indonesia) The Group is developing Savyavasa, a residential project in South Jakarta, Indonesia, with a total floor area of approximately 1.123 million sq ft, expected to provide around 400 residential units and be completed by the end of 2025. As of August 1, 2025, 156 units have been sold - Savyavasa, a residential project in South Jakarta, Indonesia, is expected to provide approximately **400 residential units** and be completed by the end of 2025[128](index=128&type=chunk) - As of August 1, 2025, **156 units** of the Savyavasa project have been sold[128](index=128&type=chunk) [Vietnam](index=36&type=section&id=Vietnam) The Group is investing in Empire City, a residential-led mixed-use development in Ho Chi Minh City, Vietnam, expected to be completed in phases by 2031 or earlier. As of August 1, 2025, approximately 53% of the units have been presold or sold - The Group's investment in Empire City, a mixed-use development in Ho Chi Minh City, Vietnam, is expected to be completed in phases by **2031 or earlier**[129](index=129&type=chunk) - As of August 1, 2025, approximately **53% of the units** in the Empire City project have been presold or sold[129](index=129&type=chunk) [Thailand](index=36&type=section&id=Thailand) The Group acquired a 40% interest in a plot of land on Wireless Road in Bangkok, Thailand, to co-develop a residential project comprising two towers, expected to be completed in 2029. Piling works are currently underway - The Group is co-developing a residential project comprising two towers on Wireless Road in Bangkok, Thailand, which is expected to be completed in **2029**[130](index=130&type=chunk) [United States](index=36&type=section&id=United%20States) Presales for the Mandarin Oriental Residences Miami project began in 2024 with an enthusiastic market response. The existing Mandarin Oriental hotel closed in May 2025, with demolition planned for early 2026 to make way for the new project. The Group completed the disposal of the North Squared site in Brickell, Miami, in July 2025 - Presales for the Mandarin Oriental Residences Miami project began in **2024**, with an enthusiastic market response[131](index=131&type=chunk) - The existing Mandarin Oriental hotel closed in **May 2025**, with demolition planned for early **2026** to make way for the new development project[131](index=131&type=chunk) [Residential Market Outlook for Indonesia, Vietnam, Thailand, and the US](index=36&type=section&id=Residential%20Market%20Outlook%20for%20Indonesia,%20Vietnam,%20Thailand,%20and%20the%20US) Demand for luxury residential properties in Southeast Asia continues to be supported by urbanization, a growing middle class, and limited supply, with markets like Jakarta, Ho Chi Minh City, and Bangkok expected to improve. Despite recent market uncertainties, the Miami luxury residential market outlook remains robust due to its pleasant climate, favorable tax regime, and status as a gateway city to Latin America - Urbanization, a growing middle class, and limited supply continue to support demand for luxury residential properties in Southeast Asia, with markets like Jakarta, Ho Chi Minh City, and Bangkok expected to improve[132](index=132&type=chunk) - The Miami luxury residential market outlook remains robust due to Florida's pleasant climate, favorable tax regime, and its geographical position as a gateway city connecting to Latin America[132](index=132&type=chunk) [Residential Property Management](index=36&type=section&id=Residential%20Property%20Management) The Group manages 18 of its developed estates and is responsible for managing the Hong Kong residential property "OPUS HONG KONG". Management services include daily assistance, maintenance, cleaning, security, and renovation of common areas, with an emphasis on maintaining good relationships with residents - The Group manages **18 of its developed estates** and is responsible for managing the Hong Kong residential property "OPUS HONG KONG"[133](index=133&type=chunk) - Management services include providing daily assistance, management, maintenance, cleaning, security, and renovation of common areas and facilities for residents[133](index=133&type=chunk) [Hotels](index=37&type=section&id=Hotels) The Group owns and manages hotels in Hong Kong, mainland China, and the US through Swire Hotels, including "The House Collective" and "EAST" brands. In H1 2025, hotels managed by Swire Properties recorded an operating profit before depreciation of HKD 25 million, consistent with the previous year. Hong Kong hotel visitor recovery was slower, mainland China hotel performance was mixed, and US hotel operating performance was strong. The Group has confirmed plans to open five new hotels in Tokyo and mainland China [Overview](index=37&type=section&id=Overview) The Group owns and manages hotels in Hong Kong, mainland China, and the US through Swire Hotels, including "The House Collective" and "EAST" brands. In H1 2025, hotels managed by Swire Properties recorded an operating profit before depreciation of HKD 25 million, consistent with H1 2024. The Group has confirmed plans to open five new hotels in Tokyo and in Beijing, Shenzhen, Shanghai, and Xi'an in mainland China - The Group owns and manages hotels in Hong Kong, mainland China, and the US through Swire Hotels, including "The House Collective" and "EAST" brands[134](index=134&type=chunk) - In H1 2025, hotels managed by Swire Properties recorded an operating profit before depreciation of **HKD 25 million**, consistent with H1 2024[134](index=134&type=chunk) - The Group has confirmed plans to open **five new hotels** in Tokyo and in Beijing, Shenzhen, Shanghai, and Xi'an in mainland China[134](index=134&type=chunk) [Hong Kong](index=38&type=section&id=Hong%20Kong) The Group wholly owns and manages The Upper House and EAST Hong Kong. Additionally, the Group holds a 20% interest in JW Marriott Hotel Hong Kong, Conrad Hong Kong, and Island Shangri-La, and a 26.67% interest in Novotel Citygate Hong Kong and The Silveri Hong Kong - MGallery. Hong Kong hotels managed by Swire Properties faced operational difficulties due to slower-than-expected visitor recovery, and the F&B business also remained weak - The Group wholly owns and manages The Upper House (**117 guest rooms**) and EAST Hong Kong (**331 guest rooms**)[138](index=138&type=chunk) - Hong Kong hotels managed by Swire Properties faced operational difficulties due to slower-than-expected hotel visitor recovery, and the Hong Kong F&B market remained weak[138](index=138&type=chunk) [Mainland China](index=38&type=section&id=Mainland%20China) Swire Hotels manages three hotels in mainland China: EAST Beijing, The Temple House Chengdu, and The Middle House Shanghai. The Group wholly owns The Temple House and holds a 50% interest in EAST Beijing and The Middle House. Additionally, the Group holds a 97% interest in Mandarin Oriental Guangzhou and a 50% interest in The Sukhothai Shanghai. In H1 2025, mainland China hotel performance was mixed, with improved average room revenue at The Temple House, while other hotels faced challenges - Swire Hotels manages three hotels in mainland China: EAST Beijing, The Temple House Chengdu, and The Middle House Shanghai[139](index=139&type=chunk) - In H1 2025, the performance of hotels managed and not managed by Swire Properties in mainland China was mixed, with improved average room revenue at The Temple House[139](index=139&type=chunk) [United States](index=38&type=section&id=United%20States) EAST Miami, sold to a third party in 2021 but still managed by Swire Hotels, saw improved average room revenue in H1 2025. Room rates at Mandarin Oriental Miami decreased before its closure in May 2025. The Group acquired a 25% interest in the Mandarin Oriental Miami joint venture in June 2025, increasing its stake to 100%, with the hotel planned for demolition and redevelopment in early 2026 - EAST Miami's average room revenue improved in H1 2025 due to higher room rates[140](index=140&type=chunk) - In June 2025, the Group acquired a **25% interest** in the Mandarin Oriental Miami joint venture, increasing its stake to **100%**, with the hotel ceasing operations in May 2025 and planned for demolition and redevelopment in early 2026[140](index=140&type=chunk) [Hotel Market Outlook](index=38&type=section&id=Hotel%20Market%20Outlook) The Hong Kong hotel industry outlook is expected to remain challenging, depending on the recovery of international tourist and business traveler flows. Mainland China's hotel business is anticipated to remain stable in H2 2025, while US hotels managed by Swire Properties are expected to perform well. The Group is expanding its hotel management business, focusing on brand expansion into the Asia Pacific region - The Hong Kong hotel industry outlook is expected to remain challenging, while mainland China's hotel business will remain stable in H2 2025[141](index=141&type=chunk) - Hotels managed by Swire Properties in the US are expected to perform well in H2 2025[141](index=141&type=chunk) - The Group is expanding its hotel management business, focusing on extending its hotel brands into the Asia Pacific region through a hotel management operating model[141](index=141&type=chunk) [Capital Commitments](index=39&type=section&id=Capital%20Commitments) In H1 2025, capital expenditure for Hong Kong investment properties and hotels was HKD 766 million, mainland China HKD 1.076 billion, and the US HKD 5 million. As of June 30, 2025, the Group had remaining capital commitments of HKD 19.263 billion, and attributable capital commitments from joint ventures of HKD 10.806 billion. The Group committed to injecting HKD 851 million into joint ventures - In H1 2025, capital expenditure for Hong Kong investment properties and hotels was **HKD 766 million**, for mainland China **HKD 1.076 billion**, and for the US **HKD 5 million**[142](index=142&type=chunk)[143](index=143&type=chunk)[144](index=144&type=chunk) - As of June 30, 2025, the Group had remaining capital commitments of **HKD 19.263 billion**, and attributable capital commitments from joint ventures of **HKD 10.806 billion**[216](index=216&type=chunk) - The Group committed to injecting **HKD 851 million** into joint ventures[217](index=217&type=chunk) Capital Commitments for Investment Properties and Hotels (HKD million) | Region | Expenditure for Six Months Ended June 30, 2025 | Total Commitments (as at June 30, 2025) | Commitments Related to Joint Ventures (as at June 30, 2025) | | :--- | :--- | :--- | :--- | | Hong Kong | 766 | 11,047 | 38 | | Mainland China | 1,076 | 19,022 | 10,768 | | US | 5 | - | - | | Total | 1,847 | 30,069 | 10,806 | [Financing](index=40&type=section&id=Financing) This chapter details Swire Properties' financing status, including a cash flow summary, medium-term note program, financing changes, net debt, funding sources, repayment profile, currency mix, finance costs, and net debt-to-capital ratio and interest cover, indicating a decrease in net debt, ample funding sources, and a robust financial position [Cash Flow Summary](index=40&type=section&id=Cash%20Flow%20Summary) In H1 2025, cash from operations significantly increased by 65% to HKD 6.103 billion. Net cash inflow before financing was HKD 6.683 billion, a 420% year-on-year increase. Cash and cash equivalents increased by HKD 7.907 billion Cash Flow Summary (Six Months Ended June 30) | Metric | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Cash from Operations | 6,103 | 3,701 | | Net Cash Inflow Before Financing | 6,683 | 1,284 | | Net Increase in Borrowings | 6,540 | 1,879 | | Dividends Paid | (4,491) | (4,262) | | Increase in Cash and Cash Equivalents | 7,907 | 519 | - In H1 2025, cash from operations was **HKD 6.103 billion**, a **65% increase** compared to H1 2024[147](index=147&type=chunk) - Net cash inflow before financing was **HKD 6.683 billion**, a **420% increase** compared to H1 2024[147](index=147&type=chunk) [Medium Term Note Programme](index=40&type=section&id=Medium%20Term%20Note%20Programme) The company's wholly-owned subsidiary, Swire Properties MTN Financing Limited, increased its USD 3 billion Medium Term Note Programme to USD 5 billion in 2025. Notes issued under this program are unconditionally guaranteed by the company and rated A by Fitch Ratings and (P)A2 by Moody's, providing the Group with direct access to capital markets - The company's Medium Term Note Programme was increased to a total value of **USD 5 billion** in 2025[148](index=148&type=chunk) - Notes issued are unconditionally and irrevocably guaranteed by the company and rated **A by Fitch Ratings** and **(P)A2 by Moody's**[148](index=148&type=chunk) [Changes in Financing](index=41&type=section&id=Changes%20in%20Financing) This section analyzes the Group's financing changes in H1 2025. As of June 30, 2025, borrowings and bonds totaled HKD 55.611 billion, and lease liabilities were HKD 496 million. During the period, HKD 11.002 billion in borrowings and refinancing was drawn, and HKD 565 million in bonds were issued Analysis of Changes in Financing (Six Months Ended June 30) | Metric | Borrowings and Bonds (HKD million) | Lease Liabilities (HKD million) | | :--- | :--- | :--- | | Balance as at January 1 | 48,347 | 520 | | Drawdown of Borrowings and Refinancing | 11,002 | - | | Issuance of Bonds | 565 | - | | Repayment of Borrowings | (4,105) | - | | Balance as at June 30 | 55,611 | 496 | [Net Debt](index=41&type=section&id=Net%20Debt) As of June 30, 2025, net debt was HKD 42.853 billion, a 2% decrease from HKD 43.746 billion as of December 31, 2024. The decrease in net debt primarily reflects proceeds from the disposal of the subsidiary holding Brickell City Centre, partially offset by capital and development expenditures in Hong Kong and mainland China. The Group's borrowings are primarily denominated in HKD, RMB, and USD - As of June 30, 2025, net debt was **HKD 42.853 billion**, a **2% decrease** from HKD 43.746 billion as of December 31, 2024[150](index=150&type=chunk) - The decrease in net debt primarily reflects proceeds from the disposal of the subsidiary holding Brickell City Centre, partially offset by capital and development expenditures in Hong Kong and mainland China[150](index=150&type=chunk) Outstanding Borrowings (HKD million) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Borrowings | 55,611 | 48,347 | | Lease Liabilities | 496 | 520 | | Less: Short-term Deposits and Bank Balances | 13,254 | 5,121 | | Net Debt | 42,853 | 43,746 | [Sources of Funding](index=42&type=section&id=Sources%20of%20Funding) As of June 30, 2025, committed borrowing facilities and debt securities amounted to HKD 66.807 billion, of which HKD 11.025 billion (17%) remained undrawn. Additionally, the Group had undrawn uncommitted facilities totaling HKD 400 million - As of June 30, 2025, committed borrowing facilities and debt securities amounted to **HKD 66.807 billion**, of which **HKD 11.025 billion (17%)** remained undrawn[151](index=151&type=chunk) - The Group had undrawn uncommitted facilities totaling **HKD 400 million**[151](index=151&type=chunk) [Repayment Profile and Refinancing](index=42&type=section&id=Repayment%20Profile%20and%20Refinancing) As of June 30, 2025, the repayment period for bank and other borrowings extends up to 2040. The Group's weighted average debt maturity was 3.2 years, and the weighted average cost of debt was 3.6% - As of June 30, 2025, the repayment period for bank and other borrowings extends up to **2040**[152](index=152&type=chunk) Weighted Average Maturity and Cost of Group Debt | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Weighted Average Debt Maturity | 3.2 years | 2.5 years | | Weighted Average Cost of Debt | 3.6% | 4.0% | Repayment Profile of Group Borrowings (HKD million) | Period | June 30, 2025 | Percentage | | :--- | :--- | :--- | | Within 1 year | 12,956 | 23% | | 1 to 2 years | 8,363 | 15% | | 2 to 5 years | 31,087 | 56% | | After 5 years | 3,205 | 6% | | Total | 55,611 | 100% | [Currency Mix](index=43&type=section&id=Currency%20Mix) As of June 30, 2025, the book value of the Group's total borrowings, by currency (after cross-currency swaps), was 56% in HKD, 40% in RMB, and 4% in USD Book Value of Total Borrowings by Currency (HKD million) | Currency | June 30, 2025 | Percentage | | :--- | :--- | :--- | | HKD | 30,935 | 56% | | RMB | 22,133 | 40% | | USD | 2,543 | 4% | | Total | 55,611 | 100% | [Finance Costs](index=44&type=section&id=Finance%20Costs) As of June 30, 2025, 65% of the Group's total borrowings were on fixed interest rates, and 35% on floating interest rates. Net finance costs for H1 2025 were HKD 407 million, a decrease from HKD 469 million in H1 2024 - As of June 30, 2025, **65%** of the Group's total borrowings were on fixed interest rates, and **35%** on floating interest rates[156](index=156&type=chunk) Net Finance Costs (HKD million) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Interest Expense | 973 | 905 | | Capitalized Interest | (356) | (368) | | Interest Income | (136) | (116) | | Net Finance Costs | 407 | 469 | [Net Debt-to-Capital Ratio and Interest Cover](index=45&type=section&id=Net%20Debt-to-Capital%20Ratio%20and%20Interest%20Cover) As of June 30, 2025, the net debt-to-capital ratio was 15.7%, consistent with December 31, 2024. The underlying interest cover was 11.5 times, and cash interest cover was 6.6 times Net Debt-to-Capital Ratio and Interest Cover | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Net Debt-to-Capital Ratio | 15.7% | 15.7% | | Underlying Interest Cover | 11.5 | 8.9 | | Cash Interest Cover | 6.6 | 5.0 | [Debt in Joint Ventures and Associates](index=45&type=section&id=Debt%20in%20Joint%20Ventures%20and%20Associates) As of June 30, 2025, the total net debt of joint ventures and associates was HKD 16.309 billion, with the Group's attributable share being HKD 7.55 billion. If the attributable share is included in the Group's net debt, the net debt-to-capital ratio would increase to 18.5% Net Debt Position of Joint Ventures and Associates (HKD million) | Region | Net Debt of Joint Ventures and Associates (June 30, 2025) | Group's Attributable Share of Net Debt (June 30, 2025) | | :--- | :--- | :--- | | Hong Kong Entities | 8,028 | 3,002 | | Mainland China Entities | 7,946 | 4,393 | | US and Other Entities | 335 | 155 | | Total | 16,309 | 7,550 | - If the attributable share of net debt from joint ventures and associates is included in the Group's net debt, the net debt-to-capital ratio would increase to **18.5%**[158](index=158&type=chunk) [Review Report on Condensed Interim Financial Statements](index=46&type=section&id=Review%20Report%20on%20Condensed%20Interim%20Financial%20Statements) PricewaterhouseCoopers reviewed Swire Properties Limited's condensed interim financial statements for the six months ended June 30, 2025. The review scope was less than an audit, but nothing came to their attention that caused them to believe the financial statements were not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" [Introduction](index=46&type=section&id=Introduction) PricewaterhouseCoopers has reviewed the condensed interim financial statements of Swire Properties Limited and its subsidiaries for the six months ended June 30, 2025, and reported in accordance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants - PricewaterhouseCoopers has reviewed the condensed interim financial statements of Swire Properties Limited for the six months ended June 30, 2025[159](index=159&type=chunk) - The directors of the company are responsible for the preparation and presentation of these condensed interim financial statements in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants[159](index=159&type=chunk) [Scope of Review](index=46&type=section&id=Scope%20of%20Review) The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, which is substantially less in scope than an audit, and therefore does not provide assurance that all material matters would be identified. Consequently, the auditor does not express an audit opinion - The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, which is substantially less in scope than an audit conducted in accordance with Hong Kong Standards on Auditing[160](index=160&type=chunk) - The auditor does not express an audit opinion, as a review does not provide assurance that all material matters would be identified[160](index=160&type=chunk) [Conclusion](index=46&type=section&id=Conclusion) Based on the review, nothing came to the auditor's attention that caused them to believe the Group's condensed interim financial statements were not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" - Nothing came to the auditor's attention that caused them to believe the Group's condensed interim financial statements were not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting"[161](index=161&type=chunk) [Condensed Interim Financial Statements](index=47&type=section&id=Condensed%20Interim%20Financial%20Statements) This chapter presents Swire Properties' unaudited condensed interim financial statements for the six months ended June 30, 2025, including the consolidated income statement, consolidated statement of comprehensive income, consolidated statement of financial position, consolidated statement of cash flows, and consolidated statement of changes in equity, providing an overview of the Group's financial performance and position during the reporting period [Consolidated Income Statement](index=47&type=section&id=Consolidated%20Income%20Statement) For the six months ended June 30, 2025, the Group's revenue was HKD 8.723 billion, and operating profit was HKD 355 million. A loss of HKD 1.201 billion was recorded for the period, with a loss attributable to company shareholders of HKD 1.202 billion, and basic and diluted loss per share of HKD 0.21 Consolidated Income Statement Summary (Six Months Ended June 30) | Metric | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Revenue | 8,723 | 7,279 | | Gross Profit | 5,715 | 5,275 | | Fair Value Changes of Investment Properties | (3,900) | (842) | | Operating Profit | 355 | 3,217 | | Net Finance Costs | (407) | (469) | | (Loss)/Profit Before Tax | (591) | 3,098 | | (Loss)/Profit for the Period | (1,201) | 1,890 | | (Loss)/Profit Attributable to Company Shareholders | (1,202) | 1,796 | | (Loss)/Earnings Per Share (Basic and Diluted) | (0.21) | 0.31 | [Consolidated Statement of Comprehensive Income](index=48&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2025, the loss for the period was HKD 1.201 billion. Total other comprehensive income was HKD 1.698 billion, primarily from net exchange differences and the share of other comprehensive income of joint ventures and associates. Total comprehensive income for the period was HKD 497 million, with HKD 439 million attributable to company shareholders Consolidated Statement of Comprehensive Income Summary (Six Months Ended June 30) | Metric | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | (Loss)/Profit for the Period | (1,201) | 1,890 | | Net Exchange Differences Recognized During the Period (Not Reclassified to Profit or Loss) | 57 | (37) | | Items That May Be Reclassified Subsequently to Profit or Loss | 1,641 | (1,592) | | Other Comprehensive Income for the Period, After Tax | 1,698 | (1,628) | | Total Comprehensive Income for the Period | 497 | 262 | | Total Comprehensive Income Attributable to Company Shareholders | 439 | 205 | [Consolidated Statement of Financial Position](index=49&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets less current liabilities were HKD 331.172 billion. Investment properties amounted to HKD 269.520 billion. Net current assets were HKD 5.129 billion. Total equity was HKD 272.547 billion, with HKD 270.670 billion attributable to company shareholders Consolidated Statement of Financial Position Summary (as at June 30) | Metric | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Investment Properties | 269,520 | 271,617 | | Interests in Joint Ventures | 21,859 | 21,167 | | Interests in Associates | 10,628 | 10,296 | | Cash and Cash Equivalents | 13,254 | 5,121 | | Net Current Assets | 5,129 | 7,311 | | Long-term Borrowings and Bonds | 42,655 | 41,587 | | Total Equity | 272,547 | 278,427 | | Equity Attributa

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確 性或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部或任何部分內容而產生或 因倚賴該等內容而引致的任何損失承擔任何責任。 太古股份有限公司 (於香港註冊成立的有限公司) (股份代號：00019 及 00087) 二零二五年中期業績 太古股份有限公司二零二五年中期報告 | 目錄 | | | --- | --- | | 企業宣言 | 1 | | 表現摘要 | 2 | | 主席報告 | 3 | | 業務評述 | 8 | | 財務評述 | 38 | | 融資 | 40 | | 簡明中期財務報表的審閲報告 | 45 | | 簡明中期財務報表 | 46 | | 簡明中期財務報表附註 | 51 | | 附加資料 | 75 | | 詞彙 | 78 | | 財務日誌及投資者資訊 | 80 | 太古股份有限公司二零二五年中期報告 企業宣言 永續發展 長遠增長 太古公司是基地設於香港的國際綜合企業，其多元化的業務在市場擁有領先地位。公司在大中 華區歷史悠久，「太古」的名字在這地區享譽超過一百五十年。 我們的目標是透過長遠地創造理想的權益回報以實 ...

香港交易及結算所有限公司及香港聯合交易所有限公司對本公布之內容概不 負 責，對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示 概 不 會 就 本 公 布 全 部或任何部分內容而產生或因倚賴該等內容而引致之任何損失承擔任何責任。 * （於開曼群島註冊成 立 及其成員責任為有限） （股 份 編 號：2314） 中期業績公布 截 至2025年6月30日 止6個 月 財務摘要 * 僅供識別 – 1 – － 收 入122億 港 元，比 去 年 同 期 下 跌2.2%。 – 期內盈利8.11億 港 元，比 去 年 同 期 上 升0.7%。 － 每股盈利18.88港 仙。 － 宣派中期股息每股6.6港 仙。 中期業績 理文造紙有限公司（「本 公 司」）董 事 會 欣 然 公 布，本 公 司 及 其 附 屬 公 司（「本 集 團」） 截 至2025年6月30日 止6個 月 未 經 審 核 簡 明 綜 合 業 績，連 同 比 較 數 字 如 下： 簡明綜合損益及其他全面收益表 截 至2025年6月30日 止6個 月 | | | | | | | | | | | | | | | | | 202 ...

[Manulife Q2 2025 Performance Overview](index=1&type=section&id=I.%20Manulife%20Q2%202025%20Performance%20Overview) Manulife delivered strong Q2 2025 results, marked by robust new business growth, strong profitability in key segments, leading AI adoption, and strategic expansion in wealth and asset management [Performance Highlights](index=1&type=section&id=1.1%20Performance%20Highlights) Manulife achieved strong Q2 2025 growth with robust new business, strong profitability in key segments, leading AI adoption, and a strategic acquisition to boost wealth and asset management - **New business growth momentum was strong**, with **high-potential businesses recording robust earnings growth**[2](index=2&type=chunk) - All three insurance business segments saw new business CSM year-over-year growth exceeding **30%**[3](index=3&type=chunk) - Global Wealth and Asset Management business expanded its core EBITDA margin and recorded **double-digit core earnings growth**[3](index=3&type=chunk) - Announced the acquisition of a **75% stake in Comvest Credit Partners**, expected to enhance complementary strengths and scale in private credit[4](index=4&type=chunk) Q2 2025 Key Financial Metrics | Metric | 2Q25 (CAD) | 2Q24 (CAD) | Change (Constant FX) | | :--- | :--- | :--- | :--- | | Core Earnings | 1.7 billion | 1.737 billion | -2% | | Core Earnings excluding ECL changes | 1.8 billion | 1.767 billion | +2% | | Net Income Attributable to Shareholders | 1.8 billion | 1.042 billion | +72% | | Core EPS | 0.95 | 0.91 | +2% | | EPS | 0.98 | 0.52 | +88% | | Core ROE | 15.0% | 15.7% | -0.7 pps | | ROE | 15.6% | 9.0% | +6.6 pps | | LICAT Ratio | 136% | - | - | | APE Sales | 2.23 billion | 1.907 billion | +15% | | New Business CSM | 882 million | 628 million | +37% | | New Business Value | 846 million | 691 million | +20% | | Global WAM Net Inflows | 0.9 billion | 0.1 billion | +417% | [President and CFO Commentary](index=1&type=section&id=1.2%20President%20and%20CFO%20Commentary) The President highlighted global business strength and AI integration, while the CFO noted robust earnings in WAM, Asia, and Canada despite US life claims, alongside share repurchases - The President emphasized the **strength and resilience of global operations**, with all insurance business segments seeing new business CSM year-over-year growth exceeding **30%**[3](index=3&type=chunk) - The company is integrating AI across its business, demonstrating a firm commitment to customers, digitalization, and AI solutions for operational excellence and sustainable growth[3](index=3&type=chunk) - The CFO noted that despite unfavorable U.S. life insurance claims experience, Global Wealth and Asset Management, Asia, and Canada businesses recorded **strong earnings growth**[4](index=4&type=chunk) - The company maintained **strict cost control**, with overall core expenses decreasing by **3%** compared to Q2 2024[4](index=4&type=chunk) - Book value per common share increased by **5% year-over-year**, and the company repurchased **CAD 1.1 billion** of common shares, demonstrating a commitment to enhancing shareholder value[4](index=4&type=chunk) [Consolidated Financial Performance](index=2&type=section&id=II.%20Consolidated%20Financial%20Performance) Manulife's Q2 2025 net income attributable to shareholders surged 72% due to market experience, while core earnings slightly decreased but grew 2% excluding ECL changes, with strong new business [Key Financial Metrics Overview](index=2&type=section&id=2.1%20Key%20Financial%20Metrics%20Overview) Manulife's Q2 2025 net income attributable to shareholders increased 72% to CAD 1.789 billion, driven by market improvements, with core earnings slightly down but up 2% excluding ECL changes Quarterly and Year-to-Date Key Financial Data | Metric | 2Q25 | 2Q24 | Change | YTD 2025 | YTD 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net Income Attributable to Shareholders (million CAD) | 1,789 | 1,042 | 72% | 2,274 | 1,908 | 16% | | Core Earnings (million CAD) | 1,726 | 1,737 | (2)% | 3,493 | 3,447 | (2)% | | EPS (CAD) | 0.98 | 0.52 | 88% | 1.23 | 0.97 | 23% | | Core EPS (CAD) | 0.95 | 0.91 | 2% | 1.94 | 1.82 | 3% | | ROE | 15.6% | 9.0% | 6.6 pps | 9.7% | 8.5% | 1.2 pps | | Core ROE | 15.0% | 15.7% | (0.7) pps | 15.3% | 16.0% | (0.7) pps | | Book Value Per Common Share (CAD) | 24.90 | 23.71 | 5% | 24.90 | 23.71 | 5% | | APE Sales (million CAD) | 2,230 | 1,907 | 15% | 4,919 | 3,790 | 26% | | New Business CSM (million CAD) | 882 | 628 | 37% | 1,789 | 1,286 | 34% | | New Business Value (million CAD) | 846 | 691 | 20% | 1,753 | 1,332 | 27% | | Global WAM Net Inflows (billion CAD) | 0.9 | 0.1 | 417% | 1.4 | 6.8 | (80)% | [Profitability Analysis](index=3&type=section&id=2.2%20Profitability%20Analysis) Q2 2025 core earnings decreased 2% to CAD 1.726 billion due to adverse US life claims and higher ECL, offset by strong growth in WAM, Asia, and Canada, while net income surged 72% [Core Earnings](index=3&type=section&id=2.2.1%20Core%20Earnings) Q2 2025 core earnings were CAD 1.726 billion, down 2% year-over-year, primarily due to unfavorable US life claims and increased ECL provisions, partially offset by strong growth in Asia, WAM, and Canada - Q2 2025 core earnings were **CAD 1.7 billion**, a **2% decrease** compared to Q2 2024[12](index=12&type=chunk) - The decline in core earnings was primarily offset by unfavorable U.S. life insurance claims experience and increased ECL provisions[12](index=12&type=chunk) - Excluding the impact of ECL changes, core earnings were **CAD 1.8 billion**, representing a **2% year-over-year increase**[4](index=4&type=chunk) Core Earnings Performance by Segment (million CAD) | Segment | 2Q25 | 2Q24 | Change | YTD 2025 | YTD 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Asia | 520 | 449 | 13% | 1,012 | 914 | 10% | | Canada | 419 | 402 | 4% | 793 | 766 | 4% | | U.S. | 141 | 303 | (53)% | 392 | 638 | (39)% | | Global Wealth and Asset Management | 463 | 386 | 19% | 917 | 735 | 22% | | Corporate and Other | (70) | (82) | 12 | (197) | (163) | (34) | | **Total** | **1,726** | **1,737** | **(2)%** | **3,493** | **3,447** | **(2)%** | [Net Income Attributable to Shareholders](index=4&type=section&id=2.2.2%20Net%20Income%20Attributable%20to%20Shareholders) Q2 2025 net income attributable to shareholders increased by CAD 0.7 billion to CAD 1.8 billion, mainly driven by improved market experience, including better-than-expected listed equity returns and derivative gains - Q2 2025 net income attributable to shareholders was **CAD 1.8 billion**, an increase of **CAD 0.7 billion** compared to Q2 2024[13](index=13&type=chunk) - The increase in net income was primarily due to **improved market experience**, reflecting better-than-expected listed equity returns and gains from derivatives and the ineffective portion of hedging accounting[13](index=13&type=chunk) - Part of the increase was offset by lower-than-expected returns from alternative long-duration assets, mainly involving real estate and private equity investments[13](index=13&type=chunk) [Capital and Shareholder Value](index=1&type=section&id=2.3%20Capital%20and%20Shareholder%20Value) Manulife maintains a robust capital position with a 136% LICAT ratio, demonstrating commitment to shareholder value through a 5% annual increase in book value per common share and active share repurchases [Life Insurance Capital Adequacy Test Ratio](index=1&type=section&id=2.3.1%20Life%20Insurance%20Capital%20Adequacy%20Test%20Ratio) As of June 30, 2025, Manulife's Life Insurance Capital Adequacy Test (LICAT) ratio was 136%, indicating strong capital adequacy - The Life Insurance Capital Adequacy Test (LICAT) ratio was **136%**[4](index=4&type=chunk) [Book Value Per Common Share](index=1&type=section&id=2.3.2%20Book%20Value%20Per%20Common%20Share) Book value per common share was CAD 24.90 at Q2 2025 end, up 5% year-over-year, with adjusted book value increasing 7% to CAD 35.78 Book Value Per Common Share (CAD) | Metric | 2Q25 | 2Q24 | Change | | :--- | :--- | :--- | :--- | | Book Value Per Common Share | 24.90 | 23.71 | 5% | | Adjusted Book Value Per Common Share | 35.78 | 33.32 | 7% | [Share Repurchases](index=1&type=section&id=2.3.3%20Share%20Repurchases) Manulife has repurchased CAD 1.1 billion of common shares year-to-date, underscoring its commitment to enhancing shareholder value - Since the beginning of the year, the company has repurchased **CAD 1.1 billion** of common shares[4](index=4&type=chunk) [Business Segment Performance](index=2&type=section&id=III.%20Business%20Segment%20Performance) Manulife's business segments showed varied performance, with strong growth in Asia and Global WAM, moderate growth in Canada, and a decline in US core earnings due to adverse claims experience [Asia Business](index=2&type=section&id=3.1%20Asia%20Business) Asia business delivered strong performance with core earnings growth of 13% to USD 520 million, significant growth in APE sales, new business CSM, and value, alongside enhanced distribution and product offerings - Asia core earnings increased by **13%**, reflecting sustained business growth, favorable claims experience, and improved new business impact[17](index=17&type=chunk) Asia Business Key Metrics (million USD) | Metric | 2Q25 | 2Q24 | Change | YTD 2025 | YTD 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net Income Attributable to Shareholders | 600 | 424 | 44% | 1,035 | 694 | 49% | | Core Earnings | 520 | 449 | 13% | 1,012 | 914 | 10% | | APE Sales | 1,233 | 920 | 31% | 2,645 | 1,870 | 41% | | New Business CSM | 480 | 349 | 34% | 978 | 713 | 36% | | New Business Value | 451 | 346 | 28% | 908 | 669 | 35% | - Manulife Asia's Million Dollar Round Table (MDRT) membership grew by **23% year-over-year**, ranking third globally for MDRT members in 2025[9](index=9&type=chunk) - Became the **first international life insurer to establish an office in the Dubai International Financial Centre**, deepening its presence in the Middle East[9](index=9&type=chunk) [Canada Business](index=2&type=section&id=3.2%20Canada%20Business) Canada business core earnings rose 4% to CAD 419 million, primarily due to group insurance growth and improved investment spreads, with new business value up 1% and CSM up 32% despite lower APE sales - Canada core earnings increased by **4%**, driven by growth in group insurance business and higher investment spreads[17](index=17&type=chunk) Canada Business Key Metrics (million CAD) | Metric | 2Q25 | 2Q24 | Change | YTD 2025 | YTD 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net Income Attributable to Shareholders | 390 | 79 | 394% | 612 | 352 | 74% | | Core Earnings | 419 | 402 | 4% | 793 | 766 | 4% | | APE Sales | 345 | 520 | (34)% | 836 | 970 | (14)% | | New Business CSM | 100 | 76 | 32% | 191 | 146 | 31% | | New Business Value | 161 | 159 | 1% | 341 | 316 | 8% | - APE sales decreased by **34%**, primarily offset by the absence of a large group insurance sale in Q2 2024[18](index=18&type=chunk) - New business CSM grew by **32%**, reflecting strong sales growth in individual insurance[18](index=18&type=chunk) [U.S. Business](index=2&type=section&id=3.3%20U.S.%20Business) U.S. business core earnings declined 53% to USD 141 million due to unfavorable life claims, lower investment spreads, and increased ECL provisions, despite strong new business growth across key metrics - U.S. core earnings decreased by **53%**, reflecting unfavorable life insurance claims experience, lower investment spreads, and increased ECL provisions[17](index=17&type=chunk) U.S. Business Key Metrics (million USD) | Metric | 2Q25 | 2Q24 | Change | YTD 2025 | YTD 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net Income Attributable to Shareholders | 26 | 98 | (73)% | (371) | 18 | -% | | Core Earnings | 141 | 303 | (53)% | 392 | 638 | (39)% | | APE Sales | 130 | 93 | 40% | 250 | 206 | 21% | | New Business CSM | 86 | 54 | 59% | 156 | 126 | 24% | | New Business Value | 46 | 41 | 12% | 94 | 78 | 21% | - The segment recorded **strong new business growth** this quarter, with APE sales, new business CSM, and new business value increasing by **40%**, **59%**, and **12%** respectively[18](index=18&type=chunk) [Global Wealth and Asset Management Business](index=2&type=section&id=3.4%20Global%20Wealth%20and%20Asset%20Management%20Business) Global WAM achieved excellent results with core earnings up 19% to CAD 463 million, net inflows of CAD 0.9 billion, an expanded core EBITDA margin of 30.1%, and a strategic acquisition to boost private credit - Global Wealth and Asset Management business core earnings increased by **19%**, primarily driven by favorable market impacts, higher net fee income, increased performance fees, and ongoing cost control[17](index=17&type=chunk) Global Wealth and Asset Management Business Key Metrics (million CAD) | Metric | 2Q25 | 2Q24 | Change | YTD 2025 | YTD 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net Income Attributable to Shareholders | 482 | 350 | 36% | 925 | 715 | 25% | | Core Earnings | 463 | 386 | 19% | 917 | 735 | 22% | | Gross Inflows (billion CAD) | 43.8 | 41.4 | 5% | 94.1 | 86.9 | 5% | | Average Assets Under Management and Administration (billion CAD) | 1,005 | 933 | 7% | 1,022 | 917 | 9% | | Core EBITDA Margin | 30.1% | 26.3% | 380 bps | 29.2% | 25.9% | 330 bps | - Net inflows reached **CAD 0.9 billion**, significantly higher than the **CAD 0.1 billion** net inflows recorded in Q2 2024[4](index=4&type=chunk)[15](index=15&type=chunk) - Announced the acquisition of a **75% stake in Comvest Credit Partners**, bringing **USD 14.7 billion** in assets to the platform[4](index=4&type=chunk) [Corporate and Other Segments](index=2&type=section&id=3.5%20Corporate%20and%20Other%20Segments) Core earnings for Corporate and Other segments improved by CAD 12 million, primarily driven by a reduction in long-term incentive compensation - Core earnings for Corporate and Other segments improved by **CAD 12 million**, primarily due to a reduction in long-term incentive compensation[17](index=17&type=chunk) [Operations and Strategic Focus](index=3&type=section&id=IV.%20Operations%20and%20Strategic%20Focus) Manulife is strategically integrating AI across operations to enhance customer experience and efficiency, expanding distribution capabilities, driving new business growth, and making a key acquisition to strengthen its WAM platform [AI Technology Application and Innovation](index=3&type=section&id=4.1%20AI%20Technology%20Application%20and%20Innovation) Manulife is actively integrating AI across its operations, leading in AI maturity within the life insurance sector, and deploying AI-driven solutions in retirement, Asia, and long-term care to boost efficiency and insights - Manulife is integrating Artificial Intelligence (AI) across its business, accelerating its goal of becoming a digital, customer-centric industry leader[7](index=7&type=chunk) - Manulife ranked **first in AI maturity** within the life insurance sector and among the **top five** across the entire insurance industry in the inaugural Evident AI Insurance Index[8](index=8&type=chunk) - Launched an **AI-driven sales support solution** in the U.S. retirement market, doubling sales opportunities and reducing information search time by over **50%**[7](index=7&type=chunk) - Introduced the **VOICE analytics platform in Asia**, utilizing generative AI to categorize data and find correlations, enhancing service quality and customer understanding[7](index=7&type=chunk) - Implemented **GenAI capabilities** in the U.S. Long-Term Care (LTC) business, aiming to enhance the automation of claims processes[7](index=7&type=chunk) [Distribution Capabilities and Product Expansion](index=3&type=section&id=4.2%20Distribution%20Capabilities%20and%20Product%20Expansion) Manulife is enhancing distribution and product offerings, with increased MDRT members in Asia, new Middle East presence, diversified asset strategies, digital travel insurance, and expanded US wholesale teams - Manulife Asia's Million Dollar Round Table (MDRT) membership grew by **23% year-over-year**, ranking third globally for MDRT members in 2025[9](index=9&type=chunk) - Became the **first international life insurer to establish an office in the Dubai International Financial Centre**, specifically providing consultation and underwriting services for high-net-worth clients' life insurance contracts[9](index=9&type=chunk) - Launched a **diversified real asset strategy in Malaysia** and introduced **four actively managed ETF series products** in the Canadian market[9](index=9&type=chunk) - Strengthened the **Manulife iFUNDS platform**, creating Singapore's first integrated digital wealth solution, combining AI-driven ILP analysis capabilities[10](index=10&type=chunk) - Launched an **end-to-end digital travel insurance platform in Canada** and partnered with Maven Clinic to offer virtual women's and family health services to group insurance members[8](index=8&type=chunk)[10](index=10&type=chunk) - Expanded its wholesale team in the U.S., implementing a more targeted growth strategy to accelerate penetration in the high-net-worth and mass affluent markets[11](index=11&type=chunk) [New Business and Contractual Service Margin](index=4&type=section&id=4.3%20New%20Business%20and%20Contractual%20Service%20Margin) Manulife's new business continues to grow, with APE sales, new business CSM, and value increasing by 15%, 37%, and 20% respectively, driving a rise in organic CSM and a total CSM of CAD 22.316 billion [New Business Sales and Value](index=4&type=section&id=4.3.1%20New%20Business%20Sales%20and%20Value) Q2 2025 APE sales, new business CSM, and new business value grew by 15%, 37%, and 20% respectively, reflecting strong sales momentum and improved profitability in insurance new business - APE sales, new business CSM, and new business value increased by **15%**, **37%**, and **20%** respectively[14](index=14&type=chunk) New Business CSM by Segment (million CAD) | Segment | 2Q25 | 2Q24 | Change | YTD 2025 | YTD 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Asia | 663 | 478 | 39% | 1,378 | 969 | 42% | | Canada | 100 | 76 | 32% | 191 | 146 | 31% | | U.S. | 119 | 74 | 61% | 220 | 171 | 29% | | **Total** | **882** | **628** | **37%** | **1,789** | **1,286** | **39%** | [Contractual Service Margin](index=4&type=section&id=4.3.2%20Contractual%20Service%20Margin) As of June 30, 2025, after-tax CSM excluding NCI was CAD 18.527 billion, with organic CSM contributing CAD 1.162 billion in growth for H1 2025, an 11% annualized increase - As of June 30, 2025, CSM recorded **CAD 22.316 billion**[16](index=16&type=chunk) - Organic CSM changes contributed an increase of **CAD 1.162 billion** for the first half of 2025, representing an **11% annualized growth**[16](index=16&type=chunk) - After-tax CSM excluding NCI was **CAD 18.527 billion**[16](index=16&type=chunk) CSM and After-Tax CSM Data (million CAD) | Metric | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | CSM | 23,722 | 23,425 | 1.3% | | CSM excluding NCI | 22,316 | 22,127 | 0.85% | | After-tax CSM | 19,782 | 19,497 | 1.46% | | After-tax CSM excluding NCI | 18,527 | 18,353 | 0.95% | [Strategic Acquisition](index=1&type=section&id=4.4%20Strategic%20Acquisition) Manulife announced the acquisition of a 75% stake in Comvest Credit Partners, expected to close in Q4 2025, enhancing its global wealth and asset management platform's private credit capabilities and scale - Announced the acquisition of a **75% stake in Comvest Credit Partners**, bringing **USD 14.7 billion** in assets to the Global Wealth and Asset Management business platform[4](index=4&type=chunk) - The transaction is expected to close in **Q4 2025**[3](index=3&type=chunk) - This acquisition will enhance complementary strengths and scale in the private credit sector, supporting the future development of the Global Wealth and Asset Management business[3](index=3&type=chunk) [Financial Metric Adjustments and Definitions](index=5&type=section&id=V.%20Financial%20Metric%20Adjustments%20and%20Definitions) Manulife has updated its 2024 non-GAAP financial metrics to reflect the retroactive global minimum tax, ensuring comparability with 2025 results, and provides detailed reconciliations for key performance indicators [Global Minimum Tax Impact](index=6&type=section&id=5.1%20Global%20Minimum%20Tax%20Impact) The Canadian government passed the Global Minimum Tax Act, retroactively applied from December 31, 2023, prompting Manulife to update 2024 non-GAAP metrics for comparability with 2025 results - The Canadian government passed the Global Minimum Tax Act, retroactively applied to financial periods beginning on or after **December 31, 2023**[24](index=24&type=chunk) - Manulife has updated certain 2024 non-GAAP financial measures to reflect the impact of the global minimum tax, enhancing comparability of 2025 and 2024 results[24](index=24&type=chunk) [Non-GAAP Financial Measures](index=6&type=section&id=5.2%20Non-GAAP%20Financial%20Measures) Manulife utilizes various non-GAAP financial measures, such as core earnings and adjusted book value, to assess performance, emphasizing they should be considered alongside GAAP financials and may not be comparable to other issuers - The company uses various non-GAAP financial measures and other financial metrics to assess overall performance and individual business segments[25](index=25&type=chunk) - Non-GAAP financial measures include core earnings, core earnings excluding the impact of ECL changes, core EBITDA, core expenses, and adjusted book value[25](index=25&type=chunk) - Non-GAAP ratios include core ROE, core EPS, core EBITDA margin, and financial leverage ratio[26](index=26&type=chunk) - These metrics are not standardized under GAAP and should not be considered in isolation or as a substitute for GAAP financial information, and may not be comparable to similar measures disclosed by other issuers[27](index=27&type=chunk) [Core Earnings and Net Income Reconciliation](index=6&type=section&id=5.3%20Core%20Earnings%20and%20Net%20Income%20Reconciliation) The report provides detailed reconciliation tables for core earnings and net income attributable to shareholders for Q2 2025, Q1 2025, Q2 2024, and year-to-date, presented on a constant currency basis - Reconciliation tables for Q2 2025 core earnings and net income attributable to shareholders are provided, detailing excluded items such as market experience (gains) losses and restructuring expenses[28](index=28&type=chunk) - The reconciliation tables present income before income taxes, income tax (expense) recovery, core earnings, and net income by business segment (Asia, Canada, U.S., Global Wealth and Asset Management, Corporate and Other)[28](index=28&type=chunk) - Reconciliation tables for core earnings presented on a constant currency basis are also provided, along with core earnings for Asia and U.S. segments denominated in USD[29](index=29&type=chunk) [Other Key Financial Metrics Details](index=13&type=section&id=5.4%20Other%20Key%20Financial%20Metrics%20Details) This section provides detailed data and reconciliation tables for various key financial metrics, including core earnings attributable to common shareholders, core ROE, CSM, adjusted book value, and core EBITDA for WAM [Core Earnings Attributable to Common Shareholders](index=13&type=section&id=5.4.1%20Core%20Earnings%20Attributable%20to%20Common%20Shareholders) Core earnings attributable to common shareholders for Q2 2025 were CAD 1.623 billion, with year-to-date figures reaching CAD 3.333 billion Core Earnings Attributable to Common Shareholders (million CAD) | Metric | 2Q25 | 2Q24 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Core Earnings | 1,726 | 1,737 | 3,493 | 3,447 | | Less: Preferred Share Dividends and Other Equity Distributions | 103 | 99 | 160 | 154 | | **Core Earnings Attributable to Common Shareholders** | **1,623** | **1,638** | **3,333** | **3,293** | [Core Return on Equity](index=13&type=section&id=5.4.2%20Core%20Return%20on%20Equity) Manulife's core return on equity (ROE) for Q2 2025 was 15.0%, with the year-to-date core ROE standing at 15.3% Core ROE (Annualized) (%) | Metric | 2Q25 | 2Q24 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Core ROE (Annualized) | 15.0% | 15.7% | 15.3% | 16.0% | [Adjusted Book Value](index=17&type=section&id=5.4.3%20Adjusted%20Book%20Value) As of June 30, 2025, adjusted book value was CAD 60.947 billion, an increase from CAD 59.455 billion on June 30, 2024 Adjusted Book Value (million CAD) | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Common Shareholders' Equity | 42,420 | 42,305 | | After-tax CSM excluding NCI | 18,527 | 17,150 | | **Adjusted Book Value** | **60,947** | **59,455** | [Core EBITDA and Margin](index=18&type=section&id=5.4.4%20Core%20EBITDA%20and%20Margin) Global Wealth and Asset Management's Q2 2025 core EBITDA was CAD 623 million, with a core EBITDA margin of 30.1%, representing a 380 basis point increase year-over-year Global Wealth and Asset Management Business Core EBITDA and Margin (million CAD) | Metric | 2Q25 | 2Q24 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Core EBITDA | 623 | 513 | 1,231 | 990 | | Core Revenue | 2,069 | 1,948 | 4,209 | 3,821 | | **Core EBITDA Margin** | **30.1%** | **26.3%** | **29.2%** | **25.9%** | [Core Expenses](index=19&type=section&id=5.4.5%20Core%20Expenses) Core expenses for Q2 2025 were CAD 1.689 billion, showing a slight decrease compared to the same period last year Core Expenses (million CAD) | Metric | 2Q25 | 2Q24 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | General Expenses—Income Statement | 1,140 | 1,225 | 2,342 | 2,327 | | Directly Attributable Acquisition Expenses for Contracts Measured Using the Premium Allocation Approach | 40 | 39 | 82 | 77 | | Directly Attributable Maintenance Expenses | 514 | 509 | 1,046 | 1,048 | | Less: General Expenses Included in Core Earnings Excluded Items | 5 | 60 | 5 | 66 | | **Core Expenses** | **1,689** | **1,713** | **3,465** | **3,386** | [Additional Information](index=5&type=section&id=VI.%20Additional%20Information) This section provides details on the upcoming earnings conference call, directs readers to supplementary reports and contact information, and includes important cautionary notes regarding forward-looking statements [Earnings Conference Call](index=5&type=section&id=6.1%20Earnings%20Conference%20Call) Manulife will host its Q2 2025 earnings conference call and webcast on August 7, 2025, providing dial-in and webcast links, with an archived recording available afterward - Manulife will host its Q2 2025 earnings conference call and webcast on **August 7, 2025, at 8:00 AM EDT**[20](index=20&type=chunk) - Dial-in numbers and a password, as well as a webcast link, are provided[20](index=20&type=chunk) - An archived version of the webcast and a replay of the conference call will be available on the website after the meeting[20](index=20&type=chunk) [Report References and Contact Information](index=5&type=section&id=6.2%20Report%20References%20and%20Contact%20Information) This earnings press release should be read in conjunction with Manulife's Q2 2025 Shareholder Report and unaudited interim consolidated financial statements, available on company and regulatory websites - This earnings press release should be read in conjunction with the company's **Q2 2025 Shareholder Report** and **unaudited interim consolidated financial statements**[21](index=21&type=chunk) - Relevant materials have been uploaded to Manulife's website, SEDAR+ website, and the U.S. Securities and Exchange Commission website[21](index=21&type=chunk) - Contact information for media inquiries and investor relations is provided[21](index=21&type=chunk) [Caution Regarding Forward-Looking Statements](index=20&type=section&id=6.3%20Caution%20Regarding%20Forward-Looking%20Statements) The report contains forward-looking statements involving risks and uncertainties, where actual results may differ significantly from expectations, advising readers to consult regulatory filings for comprehensive risk information - The report contains written and/or oral forward-looking statements, compliant with "safe harbor" provisions of Canadian provincial securities laws and the U.S. Private Securities Litigation Reform Act of 1995[59](index=59&type=chunk) - Forward-looking statements involve risks and uncertainties and should not be unduly relied upon, as actual results may differ significantly from expectations[59](index=59&type=chunk) - Material factors include general business and economic conditions, changes in laws and regulations, changes in capital requirements, market liquidity, effectiveness of hedging strategies, business competition, and mergers and acquisitions[61](index=61&type=chunk) - Readers are advised to refer to the "Risk Management and Risk Factors" section in the company's latest Annual Report's Management's Discussion and Analysis for more information[62](index=62&type=chunk)

[Annual Performance Overview](index=1&type=section&id=Annual%20Performance%20Overview) [Financial Summary](index=1&type=section&id=Financial%20Summary) The company's FY2024 revenue decreased 13.3% YoY to HK$31.5 million and gross profit fell 10.5% to HK$18.2 million, yet the annual loss narrowed significantly by 65.5% to HK$12.5 million due to cost controls, with the Board resolving not to declare a final dividend Key Financial Metrics for FY2024 | Metric | 2024 (HK$ thousands) | 2023 (HK$ thousands) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 31,500 | 36,332 | -13.3% | | Gross Profit | 18,200 | 20,341 | -10.5% | | Loss for the year | 12,500 | 36,238 | -65.5% | | Loss for the year attributable to equity holders of the Company | 12,500 | 35,934 | -65.2% | - The Board of Directors resolved not to recommend the payment of any dividend for the year ended December 31, 2024[3](index=3&type=chunk) [Consolidated Financial Statements](index=2&type=section&id=Consolidated%20Financial%20Statements) The financial statements show a significant reduction in the 2024 loss, driven by lower administrative expenses and a reversal of impairment on trade receivables, while total assets and equity halved due to a sharp decline in the value of equity instruments at FVOCI [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) The company's 2024 loss narrowed to HK$12.5 million from HK$36.2 million in the prior year, mainly due to reduced administrative expenses and a reversal of impairment on trade receivables, with basic loss per share improving to 2.75 HK cents Key Items from the Consolidated Statement of Profit or Loss (For the year ended December 31) | Item (HK$ thousands) | 2024 | 2023 | Reason for Change | | :--- | :--- | :--- | :--- | | Revenue | 31,515 | 36,332 | Cessation of non-advertising businesses | | Gross Profit | 18,202 | 20,341 | Decreased revenue | | Administrative expenses | (23,524) | (34,840) | Reduced staff costs | | Impairment (reversal)/losses on trade receivables | 1,743 | (6,162) | Reversal of impairment | | **Loss for the year** | **(12,494)** | **(36,238)** | **Significant narrowing of loss** | | Basic loss per share | (2.75 HK cents) | (7.90 HK cents) | - | [Consolidated Statement of Financial Position](index=4&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) Total assets as of year-end 2024 decreased by 47% to HK$65.8 million, primarily driven by a sharp fall in 'equity instruments at FVOCI' within non-current assets, causing net assets to decline from HK$114.3 million to HK$52.3 million Key Items from the Consolidated Statement of Financial Position (As at December 31) | Item (HK$ thousands) | 2024 | 2023 | | :--- | :--- | :--- | | **Non-current assets** | **22,852** | **84,927** | | Including: Equity instruments at FVOCI | 128 | 59,625 | | **Current assets** | **42,989** | **39,371** | | Including: Cash and cash equivalents | 37,042 | 30,081 | | **Total assets** | **65,841** | **124,298** | | **Net assets** | **52,268** | **114,305** | | **Total equity** | **52,268** | **114,305** | [Notes to the Consolidated Financial Statements](index=5&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) [General Information and Accounting Policies](index=5&type=section&id=General%20Information%20and%20Accounting%20Policies) The company is an investment holding company engaged in advertising, healthcare products, e-commerce, and IP development, with financial statements prepared under HKFRSs and the adoption of new standards having no material impact - The Group is principally engaged in (i) provision of advertising services; (ii) sales of medical and healthcare products; (iii) e-commerce business; and (iv) provision of intellectual property (IP) development and design services[9](index=9&type=chunk) - The application of new and revised Hong Kong Financial Reporting Standards in the current year has had no material effect on the Group's financial performance and position[11](index=11&type=chunk) [Segment Information](index=6&type=section&id=Segment%20Information) The company's business structure changed significantly in 2024, with all revenue of HK$31.5 million generated from the advertising services segment, reflecting a strategic focus shift away from other now-dormant segments Segment Revenue Analysis (HK$ thousands) | Business Segment | 2024 Revenue | 2023 Revenue | | :--- | :--- | :--- | | Advertising services | 31,515 | 32,483 | | Sales of medical and healthcare products | – | 373 | | E-commerce business | – | 2,900 | | IP development and design services | – | 576 | | **Total** | **31,515** | **36,332** | - In 2024, the advertising services segment reported a profit of HK$1.3 million, while the e-commerce and IP development segments recorded minor losses[15](index=15&type=chunk) - Geographically, revenue in 2024 was primarily from Hong Kong (HK$23.9 million) and Mainland China (HK$7.6 million), whereas all 2023 revenue was from Hong Kong[17](index=17&type=chunk) [Notes on Key Financial Items](index=10&type=section&id=Notes%20on%20Key%20Financial%20Items) This section details financial data, including a loss of approximately HK$186,000 from the disposal of three subsidiaries in 2024, higher finance costs from lease liabilities, and a decrease in impairment provisions for trade receivables, with no dividend recommended - In 2024, the Group completed the disposal of the entire equity interests in three subsidiaries, Glory Novel Limited, Beyond Noble Holdings Limited, and Smart Path Enterprises Limited, resulting in a total loss of approximately HK$186,000[22](index=22&type=chunk)[51](index=51&type=chunk) - The impairment provision for trade receivables decreased from HK$4.6 million in 2023 to HK$2.9 million in 2024, with a reversal of impairment loss of HK$1.7 million during the year[30](index=30&type=chunk) - The Board does not recommend the payment of a dividend for the years ended December 31, 2024 and 2023[27](index=27&type=chunk) [Independent Auditor's Report](index=15&type=section&id=Independent%20Auditor's%20Report) The independent auditor issued a Disclaimer of Opinion on the consolidated financial statements for the year ended December 31, 2024, due to the inability to obtain sufficient appropriate audit evidence regarding key items, indicating material uncertainty about the report's reliability [Basis for Disclaimer of Opinion](index=15&type=section&id=Basis%20for%20Disclaimer%20of%20Opinion) The disclaimer is based on scope limitations concerning the investment in an associate, the unverifiable opening balances and comparative figures from the prior year's disclaimer, and the unconfirmed loss on disposal of subsidiaries due to lack of access to records - The auditor issued a **"Disclaimer of Opinion"** on the company's consolidated financial statements for the year 2024[34](index=34&type=chunk) - **Scope Limitation on Interest in an Associate**: The auditor was unable to obtain the audited financial statements of the associate, Aolorry, and thus could not determine the share of results or any potential impairment[35](index=35&type=chunk)[36](index=36&type=chunk) - **Issue with Opening Balances and Corresponding Figures**: Due to the disclaimer of opinion on the 2023 financial statements, the opening balances and comparative figures for 2024 could not be verified[38](index=38&type=chunk) - **Scope Limitation on Loss on Disposal of Subsidiaries**: The auditor could not obtain the books and records of the disposed subsidiaries (Jingji Tianzi and Haotuo), preventing confirmation of the accuracy of the reported loss on disposal[39](index=39&type=chunk) [Management Discussion and Analysis](index=17&type=section&id=Management%20Discussion%20and%20Analysis) [Financial Review](index=17&type=section&id=Financial%20Review) Total revenue in 2024 fell 13.3% to HK$31.5 million due to the cessation of non-advertising businesses, but the pre-tax loss narrowed by 65.5% to HK$12.5 million, driven by a 32.5% reduction in administrative expenses and a stable gross margin of 57.8% - Revenue decreased by **13.3% to HK$31.5 million**, primarily due to the cessation of businesses outside the advertising segment (especially the e-commerce segment)[41](index=41&type=chunk) Gross Profit and Gross Profit Margin | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Gross Profit (HK$ thousands) | 18,202 | 20,341 | | Gross Profit Margin (%) | 57.8% | 56.0% | - Administrative expenses decreased by **32.5% from HK$34.8 million to HK$23.5 million**, mainly due to reduced staff costs[50](index=50&type=chunk) - Loss before income tax decreased by **65.5% from HK$36.2 million to HK$12.5 million**[53](index=53&type=chunk) [Business Review](index=19&type=section&id=Business%20Review) The core advertising business showed resilience amid economic challenges, with the company expanding into Mainland China to offset a 26.5% decline in its Hong Kong Recruit magazine revenue, while other business segments were discontinued due to operational issues - The core advertising business, Recruit magazine, faced structural challenges, with advertising revenue **decreasing by 26.5% year-on-year to HK$23.9 million**[56](index=56&type=chunk) - The company actively expanded its digital advertising business in Mainland China, with subsidiary Shenzhen Lvqi contributing approximately **HK$5.1 million in revenue** through platforms like Douyin, and cooperation with affiliate Shenzhen Jingji bringing in about **HK$2.5 million**[57](index=57&type=chunk)[58](index=58&type=chunk) - Due to the failure of a former executive director to properly hand over documents, the medical and healthcare products, e-commerce, and IP development and design services segments have ceased developing new business and are being gradually deconsolidated or sold[59](index=59&type=chunk) [Future Prospects](index=21&type=section&id=Future%20Prospects) The company will focus on its core advertising competencies by strengthening its Hong Kong multi-platform business, expanding digital advertising solutions in Mainland China, and vertically integrating its event management services with a new factory - Consolidate the core advertising business by leveraging Recruit magazine's multi-platform reach across print, website, app, and social media[62](index=62&type=chunk) - Actively explore advertising opportunities in Mainland China, particularly by providing advertising solutions for clients on digital platforms like Douyin[62](index=62&type=chunk) - Expand promotion services and event management to Mainland China and establish an in-house factory (expected to operate in July 2025) to produce event props, achieving vertical integration and improving cost-effectiveness[64](index=64&type=chunk)[65](index=65&type=chunk) [Liquidity and Financial Resources](index=22&type=section&id=Liquidity%20and%20Financial%20Resources) The Group maintained a sound financial position at year-end 2024 with net current assets of approximately HK$30.7 million, a current ratio of 4.5, increased cash balances of HK$37.0 million, and no bank borrowings Liquidity Ratios (As at December 31) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Net Current Assets (HK$) | ~30,700,000 | ~30,700,000 | | Current Ratio | 4.5 | 4.5 | | Cash and Bank Balances (HK$) | ~37,000,000 | ~30,000,000 | | Bank Loans and Other Borrowings | None | None | [Other Important Matters](index=23&type=section&id=Other%20Important%20Matters) [Events After the Reporting Period](index=23&type=section&id=Events%20After%20the%20Reporting%20Period) Subsequent to the reporting period, the company completed the disposal of its entire interest in associate Aolorry for HK$9.95 million and is currently involved in several legal proceedings, including actions concerning a former director - In May 2025, the company disposed of its entire investment interest in its associate, Aolorry, for a consideration of **HK$9.95 million**[72](index=72&type=chunk) - The company is pursuing legal action against a former director and his controlled entities, seeking damages for breach of fiduciary duties[73](index=73&type=chunk) - A shareholder has filed a lawsuit against the company alleging defamatory statements in a published announcement, which the company is defending[75](index=75&type=chunk) [Material Acquisitions and Disposals](index=24&type=section&id=Material%20Acquisitions%20and%20Disposals) On December 23, 2024, the company entered into agreements to dispose of two subsidiaries, Beyond Noble and Smart Path, for considerations of HK$19,000 and HK$1 respectively - On December 23, 2024, the company agreed to sell the entire issued share capital of Beyond Noble for a consideration of **HK$19,000**[78](index=78&type=chunk) - On the same day, the company agreed to sell the entire issued share capital of Smart Path for a consideration of **HK$1**[78](index=78&type=chunk) [Other Material Events](index=25&type=section&id=Other%20Material%20Events) The company faces significant challenges, including a continued suspension of trading since April 2, 2024, and is working to fulfill the Stock Exchange's resumption guidance by conducting investigations and reviews - Trading in the company's shares has been **suspended on the Stock Exchange since April 2, 2024**, and will remain so until the resumption guidance is fulfilled[81](index=81&type=chunk)[99](index=99&type=chunk) - The Stock Exchange has issued resumption guidance, requiring the company to complete an independent forensic investigation, demonstrate management integrity, conduct an internal control review, and publish all outstanding financial results[83](index=83&type=chunk) - The company changed its auditor in May 2024, appointing BDO Limited as the new auditor[82](index=82&type=chunk)[86](index=86&type=chunk) - The company has engaged independent third parties to conduct an investigation into audit-related matters and an independent review of its internal control procedures to satisfy the resumption guidance[87](index=87&type=chunk) [Corporate Governance](index=27&type=section&id=Corporate%20Governance) The company is committed to maintaining high standards of corporate governance, has complied with the Corporate Governance Code, and its Audit Committee has reviewed the annual results - The company has complied with the applicable code provisions of the Corporate Governance Code as set out in Appendix C1 to the Listing Rules[89](index=89&type=chunk) - The Audit Committee has reviewed the annual results for the year ended December 31, 2024[92](index=92&type=chunk)

Financial Highlights [Financial Highlights](index=1&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) For the six months ended June 30, 2024, the company's revenue, gross profit, and loss all decreased year-over-year, with the loss attributable to equity shareholders narrowing by 22.6% **Financial Highlights for H1 2024** | Indicator | H1 2024 | H1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | Approx. HK$13.8 million | Approx. HK$20.2 million | -31.6% | | Gross Profit | Approx. HK$10.9 million | Approx. HK$14.2 million | -23.3% | | Loss for the period | Approx. HK$7.47 million | Approx. HK$9.97 million | -25.0% | | Loss attributable to equity shareholders | Approx. HK$7.47 million | Approx. HK$9.66 million | -22.6% | - The Board of Directors resolved not to declare any interim dividend for the six months ended June 30, 2024[3](index=3&type=chunk) Consolidated Financial Statements [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The company recorded revenue of HK$13.8 million in H1 2024, a 31.6% year-over-year decrease, while the loss for the period narrowed by 25.0% to HK$7.47 million **Key Items from the Statement of Profit or Loss (For the six months ended June 30)** | Item (HK$'000) | 2024 (Unaudited) | 2023 (Unaudited) | | :--- | :--- | :--- | | Revenue | 13,829 | 20,223 | | Gross Profit | 10,881 | 14,195 | | Loss before income tax | (7,471) | (9,966) | | Loss for the period | (7,471) | (9,966) | | Loss attributable to equity shareholders of the Company | (7,471) | (9,662) | | Basic and diluted loss per share | (1.64 HK cents) | (2.13 HK cents) | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2024, the company's total assets decreased significantly to HK$73.9 million, while net assets fell to HK$61.4 million primarily due to changes in reserves **Key Items from the Statement of Financial Position** | Item (HK$'000) | As at June 30, 2024 (Unaudited) | As at December 31, 2023 (Audited) | | :--- | :--- | :--- | | Non-current assets | 37,466 | 84,927 | | Current assets | 36,420 | 39,371 | | **Total assets** | **73,886** | **124,298** | | Current liabilities | 10,473 | 8,694 | | Non-current liabilities | 1,967 | 1,299 | | **Total liabilities** | **12,440** | **9,993** | | **Net assets** | **61,446** | **114,305** | | **Total equity** | **61,446** | **114,305** | Notes to the Condensed Consolidated Financial Statements [Corporate Information and Principal Activities](index=6&type=section&id=1.%20%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99) Luzqi Culture Limited is a Bermuda-incorporated investment holding company listed on the Hong Kong Stock Exchange, primarily engaged in advertising, healthcare products, e-commerce, and IP development - The Group is principally engaged in four business segments: (i) provision of advertising services; (ii) sale of medical and healthcare products; (iii) e-commerce; and (iv) provision of intellectual property (IP) development and design services[9](index=9&type=chunk) [Segment Information](index=7&type=section&id=3.%20%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) In H1 2024, all group revenue of HK$13.8 million was generated from the advertising services segment, with other segments reporting no revenue **Segment Revenue (For the six months ended June 30)** | Segment (HK$'000) | 2024 | 2023 | | :--- | :--- | :--- | | Provision of advertising services | 13,829 | 16,950 | | Sale of medical and healthcare products | – | 373 | | E-commerce | – | 2,900 | | Provision of IP development and design services | – | – | | **Total** | **13,829** | **20,223** | - All of the Group's revenue was derived from Hong Kong, with no significant revenue contribution from any single major customer[22](index=22&type=chunk)[24](index=24&type=chunk) [Loss Per Share](index=12&type=section&id=8.%20%E6%AF%8F%E8%82%A1%E8%99%A7%E6%90%8D) For the six months ended June 30, 2024, basic and diluted loss per share narrowed to 1.64 HK cents from 2.13 HK cents in the prior year period **Calculation of Loss Per Share** | Indicator | H1 2024 | H1 2023 | | :--- | :--- | :--- | | Loss attributable to equity shareholders (HK$) | 7,471,000 | 9,662,000 | | Weighted average number of ordinary shares (shares) | 455,534,000 | 454,047,000 | | **Basic and diluted loss per share** | **1.64 HK cents** | **2.13 HK cents** | Management Discussion and Analysis [Financial Review](index=14&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) In H1 2024, the Group's revenue decreased by 31.6% year-over-year to HK$13.8 million, while gross profit margin improved and loss before tax narrowed by 25.0% - The decrease in revenue was mainly due to a decline in advertising business income and the cessation of revenue from other segments like e-commerce[31](index=31&type=chunk) - **Gross profit margin increased** from 70.2% in the prior year period to **78.7%**[36](index=36&type=chunk) - **Administrative expenses decreased by 14.8%** year-over-year, primarily due to lower staff costs[39](index=39&type=chunk) [Business Review](index=16&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) During the period, the Group refocused on its core advertising business, which saw an 18.4% revenue decline, while other segments were suspended and generated no income - Revenue from the core advertising business was approximately **HK$13.8 million, a year-over-year decrease of 18.4%**, mainly due to macroeconomic instability and cautious corporate advertising budgets[42](index=42&type=chunk) - The medical and healthcare products, e-commerce, and IP development segments **recorded zero revenue** during the period due to issues including loss of control over subsidiaries and strategic reviews[33](index=33&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk) - The Group has begun expanding into Mainland China, with its subsidiary entering a business promotion agreement with Shenzhen Kingkey to provide advertising services for real estate projects[44](index=44&type=chunk) [Prospects](index=18&type=section&id=%E5%89%8D%E6%99%AF) The Group will focus on strengthening its core advertising business in Hong Kong while pursuing strategic expansion in Mainland China, including setting up a factory for its promotion business - The Group will consolidate its core competitiveness while seeking strategic expansion opportunities in both Hong Kong and Mainland China[51](index=51&type=chunk) - The Group is actively exploring advertising opportunities in Mainland China, particularly on digital platforms like Douyin[52](index=52&type=chunk) - The Group plans to expand its promotion services and event management business to Mainland China and is establishing its own factory, expected to commence operations in July 2025[54](index=54&type=chunk) [Liquidity and Financial Resources](index=19&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E6%94%BF%E8%B3%87%E6%BA%90) As of June 30, 2024, the Group maintained a sound financial position with no bank loans, net current assets of approximately HK$25.9 million, and a current ratio of 3.5 **Liquidity Indicators** | Indicator (HK$) | As at June 30, 2024 | As at December 31, 2023 | | :--- | :--- | :--- | | Net Current Assets | Approx. 25,900,000 | Approx. 30,700,000 | | Cash and Bank Balances | Approx. 31,800,000 | Approx. 30,000,000 | | Current Ratio | Approx. 3.5 | Approx. 4.5 | | Net Assets | Approx. 61,400,000 | Approx. 114,300,000 | - At the end of the reporting period, the Group had **no bank loans or other borrowings**[56](index=56&type=chunk) Other Disclosures [Events After the Reporting Period](index=20&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) Subsequent to the reporting period, the Group completed several disposals, including its interests in Beyond Noble Holdings Limited, Smart Path Enterprises Limited, and an associate company - Disposed of the entire issued share capital of Beyond Noble (holding 51% of Kingkey Tianzi) and Smart Path (holding Haotuo)[61](index=61&type=chunk) - Disposed of the entire investment interest in the associate company, Aoluorui, for a consideration of HK$9.95 million[62](index=62&type=chunk) [Litigation](index=21&type=section&id=%E8%A8%B4%E8%A8%9F) The company is involved in several legal proceedings, including actions against a former director for breach of fiduciary duties and a defamation lawsuit filed by a former director - The Company has initiated legal action against a former director for breach of fiduciary duties, seeking damages[64](index=64&type=chunk) - A former director has filed a defamation lawsuit against the Company, alleging defamatory statements in its announcements[66](index=66&type=chunk) [Other Significant Events](index=22&type=section&id=%E5%85%B6%E4%BB%96%E9%87%8D%E8%A6%81%E4%BA%8B%E4%BB%B6) Trading in the company's shares has been suspended since April 2, 2024, and the company is working to fulfill the Stock Exchange's resumption guidance - Trading in the Company's shares on the Stock Exchange has been suspended since April 2, 2024, and will remain suspended[69](index=69&type=chunk) - The Stock Exchange has issued resumption guidance, requiring the Company to conduct an independent forensic investigation, demonstrate management integrity, review internal controls, and publish all outstanding financial results[71](index=71&type=chunk) - The Company has changed its auditor and appointed independent firms to conduct a forensic investigation and internal control review to meet resumption requirements[70](index=70&type=chunk)[74](index=74&type=chunk)[75](index=75&type=chunk) Corporate Governance and Other Information [Corporate Governance and Dividends](index=24&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E8%88%87%E8%82%A1%E6%81%AF) The company complied with all applicable Corporate Governance Code provisions during the interim period, and the Board has resolved not to recommend an interim dividend - The Company has complied with all applicable code provisions of the Corporate Governance Code as set out in Appendix C1 to the Listing Rules throughout the interim period[77](index=77&type=chunk) - The Board of Directors has resolved not to recommend the payment of any dividend for the interim period[81](index=81&type=chunk)