希慎兴业(00014) - 2020 - 年度财报

Financial Performance - The group's revenue for 2020 was HKD 3,710 million, a decrease of 7.0% from HKD 3,988 million in 2019, primarily due to the impact of COVID-19 on its three main business segments [64]. - The recurring basic profit and basic profit both fell by 7.3% to HKD 2,398 million in 2020, down from HKD 2,587 million in 2019 [64]. - The group reported a loss of HKD 2,547 million in 2020, compared to a profit of HKD 4,845 million in 2019, mainly due to changes in the fair value of investment properties [64]. - Shareholders' equity as of December 31, 2020, was HKD 73,680 million, down from HKD 77,650 million in 2019 [64]. - Total revenue for the company decreased by 7.0% to HKD 3,710 million in 2020, down from HKD 3,988 million in 2019 [68]. - The office segment revenue fell by 1.0% to HKD 1,814 million, while the retail segment saw a decline of 12.9% to HKD 1,600 million [68]. - The residential segment revenue decreased by 7.2% to HKD 296 million, primarily due to limited demand from expatriates [68]. - The group reported a loss of HKD 2,547 million for 2020, compared to a profit of HKD 4,845 million in 2019 [65]. - The fair value change of investment properties was HKD 4,903 million in 2020, a significant increase from a loss of HKD 792 million in 2019 [65]. Financial Ratios and Debt Management - The net interest coverage ratio was 5.2 times, down from 17.0 times in 2019, indicating a tighter financial position [49]. - The net debt to equity ratio was 3.9% as of December 31, 2019, showing a strong balance sheet [49]. - The average debt maturity was 6.8 years, indicating a stable long-term financing strategy [49]. - The effective interest rate for the company was 3.0%, slightly down from 3.4% in 2019 [49]. - Financial expenses increased to HKD 546 million in 2020 from HKD 313 million in 2019, attributed to new funding for investment opportunities [83]. - The debt-to-equity ratio improved to a net cash position by the end of 2020, with a net interest coverage ratio dropping to 9.8 times from 17.0 times in 2019 [98]. - The average repayment period of the debt portfolio was approximately 6.8 years as of December 31, 2020, compared to 6.6 years in 2019 [96]. - The fixed-rate debt ratio increased from 84% at the end of 2019 to 88% at the end of 2020, indicating a stronger position against interest rate fluctuations [104]. Property Management and Operations - The company owns approximately 4.5 million square feet of retail, office, and residential space, enhancing its competitive advantage in the market [11]. - The company has a diversified tenant base, which has proven crucial during challenging market conditions [12]. - The occupancy rates as of December 31, 2020, were 95% for office properties and 96% for retail properties, while the residential segment had an occupancy rate of 74% [64]. - The property expenditure ratio was 13.2% in 2020, slightly down from 13.4% in 2019, indicating stable cost efficiency [69]. - The company provided various support measures to tenants, including rent reductions and marketing initiatives, in response to the challenges posed by the COVID-19 pandemic [74]. - The company expanded its partnership with IWG to increase the supply of flexible workspaces, responding to the rising demand for hybrid work models [73]. - The company maintained a stable rental level for lease renewals and new leases despite market challenges [78]. Strategic Initiatives and Future Outlook - The company aims to continue investing and developing its core business in Causeway Bay while seeking opportunities outside its primary area [61]. - The company plans to integrate environmental, social, and governance (ESG) principles into its property portfolio over the next decade [61]. - The outlook for 2021 remains uncertain, heavily dependent on the control of the COVID-19 pandemic globally [62]. - The company plans to launch an advanced e-commerce platform within the year to enhance online shopping experiences [80]. - The company is committed to sustainability, with a focus on minimizing environmental impact while achieving higher efficiency [17]. Governance and Board Structure - The group has maintained a strong governance framework, exceeding compliance requirements set by the Hong Kong Stock Exchange [111]. - The board consists of 9 members, with 4 being independent non-executive directors, surpassing the requirements of the listing rules [112]. - The group emphasizes a strong corporate governance system to enhance business performance and achieve expected results [141]. - The board has established four committees: Audit and Risk Management Committee, Remuneration Committee, Nomination Committee, and Sustainability Committee [146]. - The board's main responsibilities include overseeing the internal control and risk management systems to ensure their adequacy and effectiveness [149]. - The governance policies and guidelines are updated regularly, with the latest update in January 2021 [142]. - The board includes a New Generation Innovation Committee to advise on overall capabilities and strategic direction since 2019 [148]. - The board's composition and diversity are reviewed annually to ensure effective governance and decision-making [155]. Shareholder Engagement and Communication - The company has a dividend policy that allows all shareholders to receive dividends based on the group's financial performance and future funding needs [197]. - The company successfully held the 2020 Annual General Meeting despite the COVID-19 pandemic, implementing strict health measures including temperature checks and social distancing [198]. - The company provided shareholders with over 30 days to review the annual report and financial statements, exceeding the legal requirement of 21 days [198]. - The company has committed to regular updates on operational and financial performance during the COVID-19 pandemic, including virtual meetings with institutional investors [199]. - The company has maintained open and constructive dialogue with stakeholders, including investors and credit rating agencies [200].