SHK PPT(HK:00016)2020-10-04 10:11Financial Performance - Total revenue for the year ended June 30, 2020, was HKD 82,653 million, a decrease of 3.1% from HKD 85,302 million in 2019[12] - The attributable profit to shareholders was HKD 23,521 million, down 47.6% from HKD 44,912 million in the previous year[12] - Basic earnings per share as reported was HKD 8.12, a decline of 47.6% compared to HKD 15.50 in 2019[12] - Total rental income for the year was HKD 24,214 million, a decrease of 3.4% from HKD 25,077 million in 2019[12] - Net rental income was HKD 18,565 million, down 5.7% from HKD 19,678 million in the previous year[12] - The company reported a basic underlying profit of HKD 29,368 million, down 9.4% from HKD 32,398 million in 2019[12] - The basic earnings attributable to shareholders for the year ended June 30, 2020, were HKD 29.368 billion, down from HKD 32.398 billion in the previous year, representing a decrease of approximately 6.3%[22] - The basic earnings per share for 2020 was HKD 10.13, compared to HKD 11.18 in 2019, reflecting a decline of about 9.4%[19] - Total rental income decreased by 3% year-on-year to HKD 24.214 billion, while net rental income fell by 6% to HKD 18.565 billion due to local social events and the impact of the COVID-19 pandemic[24] - The net debt to equity ratio increased to 14.1% from 12.9% in 2019, while the payout ratio rose to 48.9% from 44.3%[12] - The interest coverage ratio decreased to 11.8 times in 2020 from 14.6 times in 2019, reflecting a decline in operating profit relative to interest expenses[19] Property Development and Investment - The total land reserve in Hong Kong was 57.5 million square feet, a slight decrease of 0.9% from 58.0 million square feet in 2019[12] - The land reserve in mainland China increased to 68.1 million square feet, up 4.1% from 65.4 million square feet in the previous year[12] - The group has 24.1 million square feet of properties under development, primarily for sale, and 33.4 million square feet of completed properties, mostly for leasing/investment[20] - The group recorded a total land reserve of approximately 57.5 million square feet in Hong Kong, including 24.1 million square feet for various development purposes[27] - The group achieved a contract sales amount of approximately HKD 33.6 billion, primarily from projects in West Kowloon and Wetland Seasons Park[27] - The group has a land reserve of 68.1 million square feet in mainland China, with 53.6 million square feet under development, of which about 50% will be high-end residential properties[37] - The group expects to complete approximately 12 million square feet of investment properties over the next four fiscal years, significantly increasing its current portfolio of about 14 million square feet[40] - The group is actively pursuing new project developments to strengthen its property investment portfolio in Hong Kong and mainland China[34] - The group is focused on selective strategies to identify opportunities in major cities in mainland China, aiming to create high-quality projects[37] - The group has commenced foundation works for the Nansha Qingsheng project in Guangzhou and is developing the Jianghehui project in Hangzhou, which will provide approximately 9 million square feet of premium office, retail, residential, and hotel facilities[46] Impact of COVID-19 - The overall average occupancy rate of the diversified property investment portfolio in Hong Kong decreased to 92%, with total rental income declining by 4% to HKD 19.09 billion due to the impact of the COVID-19 pandemic[32] - The hotel sector in Hong Kong faced unprecedented challenges, with significant declines in occupancy rates and average room revenue, leading to substantial operating losses in the second half of the fiscal year[47] - The group has provided several months of rent relief to affected tenants in its shopping malls during the pandemic[57] - The group continues to implement additional epidemic prevention measures in residential and commercial properties to ensure a safe environment for customers and tenants[32] - The group introduced an online takeaway reservation feature in its shopping mall app to assist dining tenants amid the pandemic[32] - The group is committed to enhancing the hygiene standards of its properties and providing excellent customer service to ensure a safe and healthy environment for customers, residents, tenants, and employees[63] - The group’s property investment portfolio performance is expected to be impacted by economic weakness and ongoing pandemic measures, particularly in shopping malls, which will face strict dining restrictions[63] Community and Social Responsibility - The group is developing a transitional social housing project called "Tongxin Village," which will provide approximately 1,800 units to alleviate housing shortages in Hong Kong[58] - The group has implemented a symbolic rent for land to support the development of this housing project, balancing project development with environmental conservation[58] - The group has enhanced its community support initiatives despite challenges from local social events and the pandemic, including online activities promoting charitable actions among youth[58] - The group has provided flexible work arrangements and free virus testing for employees, along with improved medical benefits to safeguard their health[58] - The group is committed to achieving the United Nations Sustainable Development Goals and will continue to explore various methods to contribute to a more sustainable future[58] Future Outlook and Strategy - The group anticipates multiple residential project launches in Hong Kong over the next nine months, including North Point and Wetland Seasons Park, despite uncertain market responses due to the pandemic and economic recovery[63] - The group's mid-term profit outlook remains uncertain, primarily dependent on the development of the pandemic and the relaxation of related preventive measures, including the reopening of cross-border travel[64] - The group plans to expand its diversified property investment portfolio, which is expected to provide substantial recurring income sources in the long term[63] - The group is focused on acquiring land and developing properties in major cities in Hong Kong and mainland China, with ongoing construction of large integrated projects[63] - The group emphasizes its commitment to being a responsible corporate citizen and creating long-term value for stakeholders[64] Technological Advancements - The group introduced smart technology, including disinfection robots in shopping malls, to address challenges posed by the pandemic[149] - The group has launched a new online platform for technology learning to encourage self-learning among employees[58] - The company is investing in new technologies and product developments to enhance its competitive edge in the real estate market[132] - The company is actively pursuing new technology and product development to enhance operational efficiency[173] Market Position and Competitive Edge - The group continues to attract major financial institutions and multinational companies, driving long-term demand for quality office space[157] - The group is enhancing its luxury residential portfolio's competitiveness through smart home solutions despite a challenging rental market[164] - The group is committed to maintaining a strong market position through strategic acquisitions and developments in the coming years[171] - The company aims to expand its footprint in the Hong Kong real estate market, targeting both residential and commercial sectors for growth[133] - The company is exploring potential mergers and acquisitions to strengthen its market position and diversify its portfolio[132]