REGAL INT'L(00078) - 2025 - 中期业绩

I. Executive Summary 1.1 Financial Highlights The Group achieved revenue growth and stable gross profit in the first half of 2025, turning operating business from loss to profit, significantly narrowing loss attributable to shareholders, and reducing basic loss per share, though net asset value per share decreased Key Financial Data for H1 2025 (Consolidated Statement) | Indicator | For the six months ended June 30, 2025 (HKD million) | For the six months ended June 30, 2024 (HKD million) | % Change | | :--- | :--- | :--- | :--- | | Revenue | 905.6 | 863.4 | +4.9% | | Gross Profit | 311.9 | 311.0 | +0.3% | | Operating Profit/(Loss) before Depreciation, Finance Costs and Tax | 85.4 | (734.8) | N/A | | Loss Attributable to Owners of the Parent | (677.6) | (1,599.2) | -57.6% | | Basic Loss Per Ordinary Share Attributable to Owners of the Parent | HKD (0.82) | HKD (1.84) | -55.4% | | Book Value of Net Asset Value Per Ordinary Share Attributable to Owners of the Parent (at period end) | HKD 6.46 | HKD 7.16 | -9.8% | | Adjusted Net Asset Value Per Ordinary Share Attributable to Owners of the Parent (at period end) | HKD 17.20 | HKD 18.07 | -4.8% | 1.2 Business Highlights The Group's significant loss reduction is primarily due to a fair value turnaround in financial assets and decreased finance costs, with stable hotel performance, improved occupancy and RevPAR for Regala Skycity Hotel, strong property sales, especially for The Upper Queen, and active non-core asset divestment to reduce debt - The Group's loss reduction is primarily due to a fair value turnaround in financial assets from a loss of HKD 932.6 million to a gain of HKD 6.6 million, coupled with lower finance costs resulting from a decrease in HIBOR[3] - Operating profit before interest, tax, depreciation, and amortization (EBITDA) turned profitable at HKD 85.4 million, compared to a loss of HKD 734.8 million in the same period last year[3] - Regala Skycity Hotel's business remains stable, with improved occupancy and average revenue per available room (RevPAR), anticipating further enhancement with the commissioning of Terminal 2[3] - The Upper Queen project on Queen's Road West relaunched 123 residential units, with 120 units sold or under agreement to sell to date, generating significant sales proceeds[4] - The Group has entered into agreements to dispose of non-core properties in Lisbon and London to reduce debt levels and strengthen overall financial position[4] II. Financial Performance 2.1 Consolidated Income Statement The Group significantly narrowed its consolidated loss attributable to shareholders in the first half of 2025, primarily due to a fair value turnaround in financial assets and reduced finance costs - For the six months ended June 30, 2025, the Group recorded a consolidated loss attributable to shareholders of HKD 677.6 million, a significant reduction from HKD 1,599.2 million in the same period of 2024[5] - The loss reduction is mainly attributed to a fair value gain of HKD 6.6 million on financial assets at fair value through profit or loss during the review period, compared to a fair value loss of HKD 932.6 million in the corresponding period of 2024[5] - Lower finance costs in the first six months of 2025, driven by a decrease in HIBOR, also contributed to the reduced loss[5] - Operating profit before interest, tax, depreciation, and amortization (EBITDA) turned profitable at HKD 85.4 million, compared to a loss of HKD 734.8 million in the same period of 2024[5] 2.2 Analysis of Key Financial Metrics The Group's hotel property depreciation negatively impacted financial performance but had no immediate cash flow effect, with an adjusted net asset value per share provided for a more accurate asset valuation reference - Total depreciation expenses for the Hong Kong hotel portfolio amounted to HKD 290.2 million in H1 2025 (2024: HKD 291.3 million), negatively impacting financial performance but with no immediate cash flow effect[6] - As of June 30, 2025, the adjusted net asset value per ordinary share was HKD 17.20, based on a market revaluation of the Hong Kong hotel property portfolio[6] III. Business Review 3.1 Hotel Operations Hong Kong's tourism steadily recovered with increased visitor arrivals, yet average room rates and RevPAR declined; the Group's Regala Skycity Hotel performed stably and completed refinancing, while Regal REIT's loss widened due to investment property fair value losses, though core operating profit turned positive, and the Group's hotel operating and management businesses continued to contribute revenue 3.1.1 Market Overview Global economic growth slowed, China's GDP grew steadily, and Hong Kong's economy expanded with export and local demand support; Hong Kong visitor arrivals significantly increased year-on-year, but average hotel room rates and RevPAR declined - Global economic growth slowed in H1 2025, projected to decrease to 2.3%, the slowest pace since 2008[7] - China's GDP increased by 5.3% year-on-year in H1 2025[7] - Hong Kong welcomed approximately 23.6 million visitors in H1 2025, an 11.7% year-on-year increase, with 17.8 million from mainland China[7] - Hong Kong's average hotel occupancy rate rose from 83.0% in 2024 to 85.0% in H1 2025, but the actual average room rate fell by 10.8%, leading to an 8.6% year-on-year decrease in RevPAR[8] 3.1.2 Hotel Ownership Business The Group's Regala Skycity Hotel maintained stable operations with improved occupancy and RevPAR, completing HKD 2.95 billion in refinancing, while its Barcelona hotel in Spain continued to generate satisfactory rental income - Regala Skycity Hotel's business remains stable, with further improvements in occupancy and RevPAR compared to the same period last year, expected to significantly enhance performance in the coming years[9] - Regala Skycity Hotel has completed a three-year refinancing of HKD 2,950 million[9] - The Group owns a 186-room hotel in Barcelona, Spain, leased to a third-party operator, which continues to generate satisfactory rental income[10] - Regala Skycity Hotel officially opened in April 2023, featuring 1,208 rooms and suites, and has achieved BEAM Plus Gold and EarthCheck Design Gold certifications[24] 3.1.3 Regal REIT The Group holds approximately 74.9% of Regal REIT's fund units; the trust's consolidated loss increased due to fair value losses on investment properties, but core operating profit turned positive excluding fair value changes, primarily benefiting from reduced finance costs due to lower HIBOR - As of June 30, 2025, the Group held approximately 74.9% of the total issued fund units of Regal REIT[11] - Regal REIT recorded a consolidated loss before distribution to unitholders of HKD 508.1 million (H1 2024: loss of HKD 19.8 million), primarily due to a fair value loss of HKD 517.1 million on its investment property portfolio[11] - Excluding fair value changes, Regal REIT recorded a core operating profit before distribution to unitholders of HKD 9.0 million during the interim period (H1 2024: loss of HKD 36.3 million), mainly attributable to reduced finance costs due to lower HIBOR[11] - All nine of the Group's other hotels, except Regala Skycity Hotel, are owned through Regal REIT[12] 3.1.4 Hotel Operating Business Favour Link International Limited, a wholly-owned subsidiary of the Group, operates eight Regal REIT hotels as a lessee, maintaining stable operations in a competitive tourism market, with increased total net property income still below the total basic rent paid to the trust - Favour Link International Limited, a wholly-owned subsidiary of the Group, leases and operates eight hotels from Regal REIT[13] - Despite challenging operating conditions in Hong Kong's tourism sector, the total net property income from leased hotels increased compared to 2024, but remained below the total basic rent paid[13] 3.1.5 Hotel Management Business Regal Hotels International Limited, a wholly-owned subsidiary, manages Regala Skycity Hotel and Regal REIT's hotels, provides management services for iclub Mong Kok Hotel and iclub AMTD Sheung Wan Hotel under the P&R joint venture, and offers hotel management services in Shanghai and Dezhou, China - Regal Hotels International Limited manages Regala Skycity Hotel and nine hotels under Regal REIT[14] - Regal Hotels International also manages iclub Mong Kok Hotel and iclub AMTD Sheung Wan Hotel, owned by the P&R joint venture[14] - The Group provides management services for hotels operating under the Regal brand in Shanghai and Dezhou, China[15] 3.2 Property Development and Investment Hong Kong's residential property market demand remains relatively stable with rising transaction volumes, yet property prices face pressure; the Group actively advances multiple residential and commercial projects through wholly-owned properties and joint ventures P&R and Cosmopolitan International Holdings Limited, while continuing non-core asset divestment to optimize its financial structure 3.2.1 Hong Kong Property Market Overview Hong Kong property developers adopted aggressive pricing strategies, but residential property demand remained relatively stable, influenced by mainland buyers, talent schemes, lower HIBOR, and capital market wealth effects; total transaction volume rose, price declines narrowed, and the market may be entering an upward cycle - Hong Kong's residential property market saw aggressive pricing strategies from developers due to tight liquidity and substantial inventory[16] - Overall demand for Hong Kong residential properties remained relatively stable, influenced by mainland buyers, talent schemes, lower HIBOR, and a buoyant capital market[16] - Total transaction volume for Hong Kong residential properties continued to rise in the first six months of 2025, with a narrowing downward trend in property prices, suggesting the market may be entering an upward cycle[16] 3.2.2 Wholly-owned Properties The Group's wholly-owned properties include The Upper Queen on Queen's Road West, the Hai Tan Street redevelopment project in Sham Shui Po, and luxury houses at Regalia Bay in Stanley; The Upper Queen project achieved strong sales, with 120 residential units sold or under agreement, and the Group is actively divesting non-core overseas properties in London and Lisbon - The Upper Queen project on Queen's Road West was completed by the end of 2022, comprising 130 residential units[18][25] - The remaining 123 residential units at The Upper Queen were relaunched in June this year, with 120 units sold or under agreement to sell to date, generating total sales of HKD 898.7 million[18][25] - The Group still retains 8 garden houses at Regalia Bay in Stanley and will continue to dispose of some of them[18][27] - The Group has entered into an agreement to sell a property in London, UK, for a purchase price of GBP 19.5 million (approximately HKD 204.1 million), with the transaction pending approval from the shareholders of the ultimate listed parent company[18][29] - The Group has entered into an agreement to sell a renovation project in Lisbon, Portugal, for a cash consideration of EUR 9.3 million (approximately HKD 83.9 million), expected to be completed by May 2026[18][30] - The land acquisition for the project at 227-227C Hai Tan Street, Sham Shui Po, Kowloon, intended for commercial/residential development, has been completed, with demolition of existing structures and site works finished[26] 3.2.3 Joint Venture - P&R Holdings Limited P&R Joint Venture (50% owned by the Group and Paliburg each) holds a diversified property portfolio in Hong Kong, including the sold-out The Reach, Regalia Villa with 7 retained houses, We Go MALL for rental income, remaining shops and parking spaces at The Amour, and the luxury residential project Mount Regalia; Mount Regalia has sold or agreed to sell 21 houses and 77 apartment units, with profits recognized in this period's results. P&R also owns and operates iclub Mong Kok Hotel and iclub AMTD Sheung Wan Hotel, and is advancing projects at Kam Wa Street, Shau Kei Wan, and Castle Peak Road, Cheung Sha Wan - P&R Joint Venture (50% owned by the Group and Paliburg each) encompasses real estate development, investment, and financing activities[31] - The Mount Regalia project in Kau To, Sha Tin, has sold or agreed to sell 21 garden houses and 77 apartment units, totaling HKD 5,218.5 million in sales; in 2025, 18 apartment units and 1 house were agreed to be sold, totaling HKD 735.4 million in sales[16][35] - Sales transactions completed for the Mount Regalia project during this period included 1 house and 4 apartment units, totaling HKD 200.7 million in sales, with related profits recognized in the review period's results[35] - P&R currently retains 3 houses and 59 apartment units at Mount Regalia, which will continue to be offered for sale (excluding 1 retained house)[35] - The Reach apartment building in Yuen Long is sold out, while Regalia Villa still retains 7 houses for sale[31] - We Go MALL shopping mall in Ma On Shan maintains stable occupancy and is held for rental income[32] - The Amour project in Sham Shui Po has sold all residential units and some shops and parking spaces, with the remaining 2 shops and 5 parking spaces continuing to be offered for sale[33] - P&R self-operates and the Group manages iclub Mong Kok Hotel (288 rooms) and iclub AMTD Sheung Wan Hotel (98 rooms)[36][37] - The Castle Peak Road project in Cheung Sha Wan has successfully consolidated 100% ownership and is in discussions with the government regarding a development and conservation proposal, including preserving the historic arcade portion[39] 3.2.4 Cosmopolitan International Holdings Limited Cosmopolitan International Holdings Limited (a listed subsidiary held by Paliburg through P&R) owns multiple property projects in China; residential units at Regal International City Chengdu are sold out, with ongoing sales of shops and parking spaces, hotel interior construction completed and certified, and active re-planning for the sale of remaining commercial and office components. All residential units at Regal New Kai Men Tianjin are sold, with ongoing shop sales, but the office market is weak; the Xinjiang project, involving afforestation for land development rights, maintains valid legal interests - Cosmopolitan International Holdings Limited is a listed subsidiary held by Paliburg through P&R[40] - Phase 3 residential units at Regal International City Chengdu are sold out, with ongoing sales of shops and parking spaces[41] - Interior construction for the 325-room hotel at the Chengdu project has been completed, obtaining the completion certificate in January 2024 and the property ownership certificate in January 2025[41] - Sales progress for the remaining commercial complex and office building at the Chengdu project has been relatively slow, with active re-planning of the sales strategy underway[42][43] - All residential units at Regal New Kai Men Tianjin are sold, with ongoing shop sales, but the overall real estate market in Tianjin, particularly for commercial properties, remains weak[45] - The Xinjiang project involves afforestation on approximately 4,300 mu of land to obtain real estate development rights for about 1,843 mu, with Cosmopolitan Group entitled to participate in bidding and receive compensation for afforestation costs, maintaining valid legal interests[46] 3.3 Aircraft Ownership and Leasing The Group divested all remaining investment interests in this business segment in 2024 and may consider reinvesting under suitable circumstances in the future - The Group further divested all its remaining investment interests in the aircraft ownership and leasing business segment in 2024[20] - The Group may consider reinvesting in this business segment when deemed appropriate[20] 3.4 Financial Assets and Other Investments The Group holds a substantial investment portfolio including listed securities, investment funds, private equity, bonds, and treasury products, recording a net gain during the review period - The Group holds a substantial investment portfolio, including listed securities, investment funds, private equity, bonds, and treasury products[47] - During the review period, the Group recorded a net gain from its financial asset investment business[47] IV. Outlook Hong Kong's business outlook remains challenging amidst macroeconomic uncertainties and geopolitical tensions; tourism is recovering, but mainland visitor spending patterns are shifting, prompting the Hong Kong government to actively promote tourism development. Lower HIBOR and potential Fed rate cuts will positively impact Hong Kong's interest rate environment, and the Group will continue its asset divestment plan to reduce debt and strengthen financial resilience - Hong Kong's overall business outlook remains challenging amidst complex macroeconomic conditions and geopolitical tensions[21] - Total visitor arrivals in Hong Kong's tourism sector are steadily rising, but mainland visitors' spending habits are shifting towards cultural and in-depth experiences, leading to a decrease in per capita expenditure[21] - The Hong Kong Tourism Board is actively promoting the 'Hong Kong Everywhere' concept and implementing the 'Hong Kong Tourism Development Blueprint 2.0,' with the government also launching nine new tourist attractions[21] - HIBOR remains at a lower level, and the general expectation of potential Fed rate cuts in the second half of this year could positively impact Hong Kong's interest rate environment[22] - The Group will continue its asset divestment plan to reduce debt levels and strengthen overall financial resilience[22] V. Financial Review 5.1 Asset Valuation The Group's Hong Kong hotel properties are accounted for at historical cost plus capital appreciation less depreciation in financial statements, not fully reflecting significant market valuation appreciation; for reference, the company provides an adjusted net asset value per share based on market revaluation - The Group's Hong Kong hotel properties are not fully reflected at their significantly appreciated market valuation in the financial statements[48] Unaudited Adjusted Net Asset Value Attributable to Owners of the Parent (As of June 30, 2025) | Indicator | HKD million | Per Ordinary Share HKD | | :--- | :--- | :--- | | Book Net Asset Value Attributable to Owners of the Parent | 5,807.7 | 6.46 | | Adjustment for Revaluation of the Group's Hong Kong Hotel Property Portfolio to Market Value and Reversal of Related Deferred Tax Liabilities | 9,648.7 | 10.74 | | Unaudited Adjusted Net Asset Value Attributable to Owners of the Parent | 15,456.4 | 17.20 | 5.2 Capital Resources and Funding The Group adopts prudent funding and financial policies, primarily financing Hong Kong and overseas projects through internal funds and bank loans; bank financing is predominantly in HKD, with interest rates determined by HIBOR, and the Group considers using interest rate and exchange rate hedging instruments - The Group adopts prudent funding and financial policies, with cash balances primarily held as bank deposits and invested in treasury and yield-enhancing products[49] - Hong Kong and overseas projects are partly funded by internal resources, with the remainder provided by bank loans, and repayment periods are determined by projected project completion dates or sales forecasts[50] - The vast majority of bank financing loans are denominated in HKD, with interest rates primarily determined by HIBOR, and the Group considers using interest rate and exchange rate hedging instruments[50] 5.3 Cash Flow Net cash flow from operating activities increased in H1 2025, while net interest expenses decreased Net Cash Flow (For the six months ended June 30, 2025) | Indicator | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 181.6 | 124.3 | | Net Interest Expenses | (373.3) | (449.9) | 5.4 Debt and Gearing Ratio As of June 30, 2025, the Group's cash and bank balances decreased, and net debt after deducting cash increased, leading to a higher gearing ratio; the adjusted gearing ratio also slightly increased when hotel properties were revalued at market prices Debt and Gearing Ratio (As of June 30, 2025) | Indicator | June 30, 2025 (HKD million) | December 31, 2024 (HKD million) | | :--- | :--- | :--- | | Cash and Bank Balances with Time Deposits | 788.3 | 1,093.8 | | Debt after Deducting Cash and Bank Balances with Time Deposits | 14,701.1 | 14,500.6 | | Gearing Ratio (Based on Book Total Assets) | 60.5% | 58.1% | | Gearing Ratio (Based on Adjusted Total Assets) | 40.1% | 38.6% | 5.5 Lease Liabilities As of June 30, 2025, the Group's lease liabilities amounted to HKD 9.0 million, a decrease from the end of 2024 Lease Liabilities (As of June 30, 2025) | Indicator | June 30, 2025 (HKD million) | December 31, 2024 (HKD million) | | :--- | :--- | :--- | | Lease Liabilities | 9.0 | 10.6 | 5.6 Pledge of Assets As of June 30, 2025, the Group's assets totaling HKD 19,484.3 million were pledged to secure bank loans and lease guarantees - As of June 30, 2025, the Group's assets totaling HKD 19,484.3 million (including properties under development, property, plant and equipment, investment properties, right-of-use assets, properties held for sale, time deposits, and bank balances) were pledged to secure bank loans and lease guarantees[55] - A pledged equity interest in a property development project holding company as of December 31, 2024, was released during the period[55] 5.7 Capital Commitments Details of the Group's capital commitments as of June 30, 2025, will be presented in the interim financial statements - Details of the Group's capital commitments as of June 30, 2025, will be presented in the interim financial statements[56] 5.8 Contingent Liabilities Details of the Group's contingent liabilities as of June 30, 2025, will be presented in the interim financial statements - Details of the Group's contingent liabilities as of June 30, 2025, will be presented in the interim financial statements[57] 5.9 Dividends The Board resolved not to declare an interim dividend for the financial year ending December 31, 2025 - The Board resolved not to declare an interim dividend for the financial year ending December 31, 2025 (2024: nil)[58] VI. Interim Financial Statements 6.1 Condensed Consolidated Income Statement The Group achieved revenue growth and stable gross profit in H1 2025, turning operating business from loss to profit, but still recorded a loss, albeit significantly narrowed compared to the same period last year Condensed Consolidated Income Statement (For the six months ended June 30, 2025) | Indicator | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Revenue | 905.6 | 863.4 | | Gross Profit | 311.9 | 311.0 | | Fair Value Gains/(Losses) on Financial Assets at Fair Value Through Profit or Loss (Net) | 6.6 | (932.6) | | Operating Profit/(Loss) before Depreciation | 85.4 | (734.8) | | Operating Loss | (212.0) | (1,037.0) | | Finance Costs | (410.5) | (511.8) | | Loss Before Tax | (716.5) | (1,666.8) | | Loss Attributable to Owners of the Parent | (677.6) | (1,599.2) | 6.2 Condensed Consolidated Statement of Comprehensive Income The Group's total comprehensive loss significantly narrowed in H1 2025, primarily due to a reduction in loss for the period, despite fluctuations in other comprehensive income/loss items Condensed Consolidated Statement of Comprehensive Income (For the six months ended June 30, 2025) | Indicator | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Loss for the Period | (732.1) | (1,665.0) | | Fair Value Changes on Cash Flow Hedges | (50.1) | 10.5 | | Exchange Differences on Translation of Foreign Operations | 53.2 | (19.8) | | Total Comprehensive Loss for the Period | (708.9) | (1,695.9) | | Attributable to Owners of the Parent | (642.5) | (1,631.7) | 6.3 Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total non-current and current assets both decreased, and net current liabilities increased, resulting in a reduction in net assets Condensed Consolidated Statement of Financial Position (As of June 30, 2025) | Indicator | June 30, 2025 (HKD million) | December 31, 2024 (HKD million) | | :--- | :--- | :--- | | Total Non-Current Assets | 21,861.9 | 22,507.6 | | Total Current Assets | 2,419.4 | 2,466.1 | | Total Current Liabilities | (5,545.1) | (5,468.7) | | Net Current Liabilities | (3,125.7) | (3,002.6) | | Net Assets | 7,523.4 | 8,214.9 | | Equity Attributable to Owners of the Parent | 5,807.7 | 6,432.8 | VII. Notes to Condensed Consolidated Financial Statements 7.1 Accounting Policies and Basis of Preparation The condensed consolidated financial statements are prepared in accordance with HKAS 34 and incorporate newly adopted revised HKFRSs, with amendments to HKAS 21 having no impact on the Group; the Group prepares financial statements on a going concern basis, believing it has sufficient working capital for the next 12 months - The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 issued by the Hong Kong Institute of Certified Public Accountants[66] - The initial adoption of the revised Hong Kong Accounting Standard 21 'Lack of Exchangeability' had no impact on the condensed consolidated financial statements[67] - The Group prepares its financial statements on a going concern basis, believing it has sufficient working capital to support its operations for the next 12 months, considering factors such as cash flows, contracted property sales, non-core asset disposal plans, and bank loan refinancing[69][71] 7.2 Segment Information The Group's business is divided into six segments: hotel operation and management and hotel ownership, asset management, property development and investment, financial asset investment, aircraft ownership and leasing, and others; management independently monitors each segment's performance, with inter-segment sales conducted at market prices - The Group's business is divided into six segments: hotel operation and management and hotel ownership, asset management, property development and investment, financial asset investment, aircraft ownership and leasing, and others[71] - Management independently monitors the performance of each business segment to make decisions on resource allocation and performance assessment[69] Segment Revenue and Results (For the six months ended June 30, 2025) | Segment | 2025 Revenue (HKD million) | 2024 Revenue (HKD million) | 2025 Segment Operating Results (HKD million) | 2024 Segment Operating Results (HKD million) | | :--- | :--- | :--- | :--- | :--- | | Hotel Operation and Management and Hotel Ownership | 850.0 | 814.8 | (59.1) | (60.4) | | Asset Management | 46.3 | 46.7 | (6.6) | (6.5) | | Property Development and Investment | 12.7 | 10.2 | (124.4) | (85.4) | | Financial Asset Investment | (0.5) | 1.3 | 4.7 | (928.8) | | Aircraft Ownership and Leasing | – | 11.8 | – | 76.0 | | Others | 134.9 | 113.7 | 0.1 | 0.7 | | Elimination | (137.8) | (135.1) | – | – | | Total | 905.6 | 863.4 | (185.3) | (1,004.4) | 7.3 Analysis of Revenue, Other Income and Gains (Net) The Group's revenue primarily stems from hotel operation and management services, with a significant increase in construction and related business revenue; net other income and gains mainly comprise bank and other interest income, and unlisted investment dividend income, but recorded a loss from the disposal of unlisted investments Revenue Sources (For the six months ended June 30, 2025) | Revenue Source | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Hotel Operation and Management Services | 819.8 | 782.3 | | Construction and Construction-Related Business Revenue | 11.0 | – | | Other Businesses | 36.0 | 28.9 | | Hotel Property Rental Income | 20.5 | 21.1 | | Investment Property Rental Income | 17.4 | 16.6 | | Aircraft Rental Income | – | 11.8 | | Total Revenue | 905.6 | 863.4 | Other Income and Gains (Net) (For the six months ended June 30, 2025) | Source | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Bank Interest Income | 5.2 | 9.6 | | Other Interest Income | 28.9 | 69.3 | | Dividend Income from Unlisted Investments | 4.7 | 8.5 | | Loss on Disposal of Unlisted Investments | (5.5) | – | | Gain on Disposal of Property, Plant and Equipment | – | 69.2 | | Total | 33.8 | 157.6 | 7.4 Analysis of Depreciation The Group's total depreciation for H1 2025 amounted to HKD 297.4 million, primarily from property, plant and equipment, and right-of-use assets Depreciation Analysis (For the six months ended June 30, 2025) | Category | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Depreciation of Property, Plant and Equipment | 158.2 | 161.6 | | Depreciation of Right-of-Use Assets | 139.2 | 140.6 | | Total Depreciation | 297.4 | 302.2 | 7.5 Finance Costs The Group's total finance costs for H1 2025 amounted to HKD 410.5 million, a decrease from the same period last year, primarily due to reduced interest on bank loans Finance Costs (For the six months ended June 30, 2025) | Category | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Interest on Bank Loans | 386.2 | 493.2 | | Amortization of Debt Establishment Costs | 20.1 | 20.7 | | Fair Value Changes on Derivative Financial Instruments | 2.9 | (3.9) | | Total Finance Costs | 410.5 | 511.8 | 7.6 Income Tax Expense/(Credit) The Group's income tax expense for H1 2025 was HKD 15.6 million, compared to a credit in the same period last year; Hong Kong profits tax is calculated at 16.5%, and overseas subsidiaries are taxed at local rates Income Tax Expense/(Credit) (For the six months ended June 30, 2025) | Category | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Current - Hong Kong | 12.5 | 8.5 | | Current - Overseas | – | 1.2 | | Deferred Tax | 3.1 | (11.5) | | Total Tax Expense/(Credit) | 15.6 | (1.8) | - Hong Kong profits tax is calculated at the applicable rate of 16.5%[76] - Tax credit from a joint venture was HKD 1.9 million (2024: tax expense of HKD 46.8 million)[76] 7.7 Dividends No dividends were paid or declared by the Group for the six months ended June 30, 2025 - No dividends were paid or declared by the Group for the six months ended June 30, 2025 (2024: nil)[77] 7.8 Basic Loss Per Share The Group's basic loss per ordinary share for H1 2025 was HKD (0.82), a significant reduction from the same period last year, with no dilution adjustment made due to the absence of potentially dilutive ordinary shares Basic Loss Per Ordinary Share (For the six months ended June 30, 2025) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Loss for the Period Attributable to Owners of the Parent (HKD million) | (677.6) | (1,599.2) | | Accrued Distribution on Perpetual Securities (HKD million) | 56.9 | 57.2 | | Weighted Average Number of Ordinary Shares in Issue (Shares) | 898,800,000 | 898,800,000 | | Basic Loss Per Ordinary Share | HKD (0.82) | HKD (1.84) | - No diluted adjustment was made to the basic loss per ordinary share due to the absence of issued ordinary shares that could potentially have a dilutive effect[77] 7.9 Trade and Other Receivables, Deposits and Prepayments As of June 30, 2025, the Group's net trade and other receivables from customers amounted to HKD 109.9 million, with most balances within three months; the Group maintains strict control over outstanding amounts, with no excessive concentration of credit risk Ageing Analysis of Trade and Other Receivables from Customers (As of June 30, 2025) | Ageing | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Within 3 months | 92.7 | 88.3 | | 4 to 6 months | 7.1 | 6.5 | | 7 to 12 months | 7.0 | 7.6 | | Over 1 year | 12.0 | 15.5 | | Total | 118.8 | 117.9 | | Impairment | (8.9) | (12.0) | | Net | 109.9 | 105.9 | - Credit terms for trade and other receivables from customers are generally 30 to 90 days[78] - The Group maintains strict control over outstanding amounts, with no excessive concentration of credit risk[79] 7.10 Trade and Other Payables, Deposits Received and Accruals As of June 30, 2025, the Group's trade and other payables to debtors amounted to HKD 38.7 million, a significant decrease from the end of 2024, primarily concentrated within three months Ageing Analysis of Trade and Other Payables to Debtors (As of June 30, 2025) | Ageing | 2025 (HKD million) | 2024 (HKD million) | | :--- | :--- | :--- | | Within 3 months | 35.4 | 68.6 | | 4 to 6 months | 1.2 | 3.2 | | 7 to 12 months | 1.9 | – | | Over 1 year | 0.2 | 0.4 | | Total | 38.7 | 72.2 | - Trade and other payables to debtors are non-interest bearing, with repayment terms generally within 90 days[80] 7.11 Events After Reporting Period Subsequent to the reporting period, on July 29, 2025, the Group entered into an agreement to dispose of its entire equity interest in Waterman House Investments Limited, involving a property in London, for a purchase price of GBP 19.5 million - On July 29, 2025, the Group entered into an agreement to dispose of its entire equity interest in Waterman House Investments Limited, involving a property at 41 Kingsway, London, for a purchase price of GBP 19.5 million (approximately HKD 204.1 million)[81] - This transaction is subject to the passing of relevant resolutions by shareholders of the ultimate listed parent company, Century City International Holdings Limited[81] VIII. Other Information 8.1 Repurchase, Sale or Redemption of Listed Securities Neither the Company nor any of its subsidiaries repurchased, sold, or redeemed any of the Company's listed securities during the six months ended June 30, 2025 - Neither the Company nor any of its subsidiaries repurchased, sold, or redeemed any of the Company's listed securities during the six months ended June 30, 2025[82] 8.2 Review of Interim Results The Group's condensed consolidated financial statements for the six months ended June 30, 2025, are unaudited but have been reviewed by external auditor Ernst & Young; the Audit Committee has reviewed the financial statements with the auditor - The Group's condensed consolidated financial statements are unaudited but have been reviewed by external auditor Ernst & Young[83] - The Audit Committee has reviewed the financial statements with the external auditor, including the accounting principles and practices adopted[84] 8.3 Corporate Governance The Group complied with the Corporate Governance Code in Appendix C1 of the Listing Rules of The Stock Exchange of Hong Kong Limited during the review period, except for the non-segregation of roles between Chairman and Chief Executive Officer, held by one individual - The Group complied with the Corporate Governance Code set out in Appendix C1 of the Listing Rules of The Stock Exchange of Hong Kong Limited[85] - The roles of Chairman and Chief Executive Officer are not segregated, with Mr. Lo Yuk Sui holding both positions[85][86] 8.4 Board of Directors The Board of Directors comprises executive, non-executive, and independent non-executive directors, with Mr. Lo Yuk Sui serving as Chairman and Chief Executive Officer - The Board of Directors includes executive directors such as Mr. Lo Yuk Sui (Chairman and Chief Executive Officer) and Ms. Lo Po Man (Vice Chairman and Managing Director), non-executive directors such as Dr. Choi Chee Ming (Vice Chairman), and independent non-executive directors such as Ms. Ng Wing Mui[86][87]