
Financial Performance - Total revenue for the year ended December 31, 2018, was HKD 10,015 million, a decrease of 15% from HKD 11,774 million in 2017[7]. - Shareholders' net profit for the year was HKD 5,285 million, slightly down from HKD 5,314 million in 2017[7]. - Earnings per share for 2018 was HKD 3.88, compared to HKD 3.90 in the previous year[7]. - Basic net profit attributable to shareholders decreased by 21% to HKD 2.631 billion, with basic earnings per share adjusted to HKD 1.93[17]. - Total operating profit decreased by 13% to HKD 7.249 billion[166]. - Shareholders' basic net profit decreased by 21% to HKD 2.631 billion, with total profit after property revaluation down by 1% to HKD 5.285 billion[165]. Revenue Breakdown - Property leasing revenue increased to HKD 8,784 million, up 5% from HKD 8,354 million in 2017, with mainland China contributing HKD 4,686 million and Hong Kong contributing HKD 4,098 million[7]. - Property sales revenue significantly decreased to HKD 1,231 million from HKD 3,420 million in 2017, reflecting a decline of 64%[7]. - Total revenue from property leasing increased by 5% to HKD 8.784 billion, with Hong Kong properties up 3% and mainland properties up 7%[168]. - Revenue from mainland properties in RMB increased by 6% and 2% year-on-year in the second half and first half of 2018, respectively, with a total annual increase of 7% outside Shanghai[74]. Dividend and Payout - The company maintained a dividend payout ratio of 21% for both years, with total dividends remaining at HKD 1,089 million[7]. - The board proposed a final dividend of HKD 0.61 per share, totaling HKD 0.80 per share for the year, subject to shareholder approval[17]. - The company reported a 3% increase in dividends, maintaining the same level as the previous year[17]. Debt and Financial Management - The net debt to equity ratio increased to 12.0% from 3.9% in 2017, indicating a rise in leverage[7]. - The total debt as of December 31, 2018, was HKD 306.51 billion, with approximately 48% denominated in RMB[188]. - The company maintains a prudent financial management strategy to support long-term development[160]. - The total interest expense for the year was HKD 1.43 billion, with net interest expense decreasing to HKD 715 million from HKD 727 million in 2017[192]. Market and Economic Outlook - The company acknowledges the potential impact of geopolitical tensions and trade disputes on the market but remains optimistic about the local economic stimulus from the Chinese government[29]. - The company is optimistic about the long-term prospects of the Hong Kong economy and property market, despite recent political factors affecting growth[33]. - The demand for residential units in Hong Kong is expected to grow significantly due to increased financial and economic ties with mainland China[32]. Property Development and Expansion - The company plans to continue expanding its property portfolio in mainland China, focusing on prime locations in major cities[6]. - The company expects to construct an additional 1.1 million square meters of high-end shopping malls and skyscrapers in mainland China over the next two years, more than any other period in its history[24]. - The company plans to continue developing sellable projects in Hong Kong but will be selective, with two such projects nearing land acquisition completion[24]. Tenant and Retail Performance - The quality of tenants in the company's office buildings is improving, with top-tier tenants in various operational cities[25]. - The overall occupancy rate for retail shops was 88% in 2018, up from 84% in 2017, while office buildings had an occupancy rate of 91%, increasing from 86%[73]. - The retail market in Hong Kong experienced stable growth, despite a slowdown in high-end consumer goods, due to the company's property portfolio not being heavily reliant on luxury brands[56]. Customer Engagement and Experience - The company aims to uphold high standards in its operations and enhance stakeholder confidence through its commitment to quality[5]. - The introduction of the "Hang Lung Club" membership program aims to enhance brand image and customer loyalty[97]. - The company plans to continue enhancing customer experience through new member programs and innovative promotional activities[174]. Asset Optimization and Management - The company has made continuous efforts in asset optimization and tenant mix enhancement, laying a solid foundation for sustainable growth in the coming years[111]. - The asset optimization plan for Hong Kong Plaza in Shanghai has been completed since January 2017, enhancing asset value and future rental income growth potential[74]. - The company is committed to integrating sustainable development strategies into its operations and engaging with stakeholders[199].