朗廷(01270) - 2025 - 中期财报

Company Background Langham Hospitality Investments primarily owns and invests in a portfolio of completed hotels in Asia, with an initial focus on the region - Langham Hospitality Investments' core business is owning and investing in a portfolio of completed hotels in Asia, with an initial focus on the region[3] - Hotel Portfolio | Hotel | Category | | :--- | :--- | | The Langham Hong Kong | Grade A Luxury Hotel | | Cordis Hong Kong | Grade A Luxury Hotel | | Eaton HK | Grade B Luxury Hotel | - All hotels are strategically located in the bustling commercial and leisure districts of Kowloon Peninsula, Hong Kong, adjacent to major transportation hubs[3] Company Information This section provides details on Langham Hospitality Investments' trust structure, its holding company, board of directors, committees, and principal bankers - Langham Hospitality Investments is a fixed single investment trust established under Hong Kong law pursuant to a trust deed[7] - Langham Hospitality Investments Limited, incorporated in the Cayman Islands, serves as the holding company for the Trust Group's hotel business operations[7] - The Board of Directors includes Chairman Dr. Lo Ka Shui, Chief Executive Officer Brett Stephen BUTCHER, and several non-executive and independent non-executive directors[7] - The company has an Audit Committee, Remuneration Committee, and Nomination Committee, with their respective members listed[7] - Principal bankers include Agricultural Bank of China, Bank of China (Hong Kong), and The Hongkong and Shanghai Banking Corporation Limited[8] Financial Highlights This section presents a comparative financial summary for the first half of 2025 versus 2024, alongside key balance sheet indicators - Financial Highlights: H1 2025 vs H1 2024 | Metric (HK$ million) | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Hotel portfolio revenue | 737.5 | 772.9 | -4.6% | | Total gross operating profit of hotel portfolio (before global marketing fees) | 217.0 | 232.5 | -6.7% | | Total rental income of Trust Group after service fees | 184.8 | 191.1 | -3.3% | | Profit attributable to stapled security holders (excluding fair value changes of investment properties, derivative financial instruments, and arrangements related to hotel management and license fees) | 28.4 | 4.3 | 560.5% | | Distributable income | 28.0 | 34.0 | -17.6% | - Key Balance Sheet Metrics | Metric | June 30, 2025 | December 31, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Total value of hotel portfolio (HK$ million) | 15,764 | 15,895 | 15,725 | | Net asset value per stapled security | HK$2.70 | HK$2.77 | HK$2.75 | | Gearing ratio | 38.5% | 38.2% | 38.1% | Chairman's Report The Chairman's Report provides an overview of market conditions, operational performance, financial status, and future outlook for the period Market Review and Operating Performance Visitor arrivals to Hong Kong increased in H1 2025, but overnight stays remain below pre-pandemic levels, with mainland visitors as the primary source - In the first half of 2025, visitor arrivals to Hong Kong reached 23.6 million, an 11.7% year-on-year increase[13] - Overnight visitor arrivals accounted for 47.7% (approximately 11.3 million), a 7.0% year-on-year increase, but still below 2018 and 2019 levels[13] - Mainland China remains the largest source market, accounting for 65.0% of overnight visitors[14] - The hotel portfolio's average room rate remained stable at HK$1,561 per night, while occupancy slightly decreased by 1.4 percentage points to 88.4%[15] - Revenue per available room (RevPAR) decreased by 1.5% year-on-year to HK$1,379 per night[15] - Food and beverage segment revenue declined by 8.2% year-on-year, primarily due to shifts in consumer dining preferences and a structural reduction in banquet events[15] - Total gross operating profit of the hotels (before global marketing fees) decreased by 6.7% to HK$217.0 million[15] Financial Position and Distribution The hotel investment portfolio valuation slightly decreased, leading to a net loss attributable to stapled security holders, with no interim distribution declared - The hotel investment portfolio valuation decreased to HK$15,764 million, a reduction from December 31, 2024[16] - Fair value losses on investment properties and derivative financial instruments totaled HK$170.6 million[16] - Finance costs decreased by 15.4% (HK$25.1 million) due to a decline in the average Hong Kong Interbank Offered Rate (HIBOR)[16] - Net loss attributable to stapled security holders was HK$142.2 million[16] - Total distributable income was HK$28.0 million, a 17.6% decrease compared to the same period last year[16] - The Board decided not to declare an interim distribution for the current period, adopting a prudent capital management strategy[16] Outlook The hotel industry faces continued weakness due to geopolitical tensions and changing consumer behavior, with profitability pressured by low room rates and rising operating costs - The macroeconomic environment is affected by geopolitical tensions, global trade uncertainties, and shifts in consumer behavior[17] - Hotel industry performance is expected to remain weak, with the second half of 2025 anticipated to be similar to the first half[17] - Profitability is pressured by subdued room rates and continuously rising operating costs, particularly frontline labor expenses[17] - Hotels will optimize dynamic pricing strategies and enhance their value-added service portfolio to capture new opportunities[18] - Management will closely monitor interest rate movements and consider measures to mitigate interest rate risks[18] - The long-term outlook for Hong Kong's hotel industry remains optimistic, supported by limited new supply, prime locations, and resilient tourism infrastructure[18] Chief Executive Officer's Review The CEO's review covers rental income, service fees, net property income, finance costs, profitability, distributable income, and hotel operating performance Rental Income and Service Fees The Trust Group's total rental income, comprising fixed and floating components, decreased by 3.5% year-on-year before service fees - The Trust Group's rental income consists of fixed rent (HK$225.0 million annually) and floating rent (50% of the hotels' total gross operating profit)[19] - Rental Income Breakdown (HK$ million) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Fixed rental income | 111.6 | 111.9 | -0.3% | | Floating rental income | 108.5 | 116.2 | -6.6% | | Total rental income before service fees | 220.9 | 229.0 | -3.5% | | Service fee expenses | (36.1) | (37.9) | -4.7% | | Total rental income of Trust Group | 184.8 | 191.1 | -3.3% | - Service Fee Breakdown (HK$ million) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Hotel management fees | 20.6 | 21.9 | -5.9% | | License fees | 7.4 | 7.7 | -3.9% | | Global marketing fees | 8.1 | 8.3 | -2.4% | | Total service fees | 36.1 | 37.9 | -4.7% | Net Property Income and Finance Costs Net property income decreased due to higher property-related expenses, while total finance costs reduced despite a shift in interest rate swaps to net expense - Net Property Income (HK$ million) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Total rental income (after service fees) | 184.8 | 191.1 | -3.3% | | Hotel property related expenses | (10.9) | (10.2) | 6.9% | | Net property income | 173.9 | 180.9 | -3.9% | - Total finance costs decreased to HK$137.7 million, a 15.4% year-on-year reduction, primarily due to a 24.6% decrease in interest expense on bank borrowings[24] - Interest rate swaps shifted from a net interest income in H1 2024 to a net interest expense of HK$8.3 million in H1 2025[24][26] - The Group added HK$1,100.0 million in new swaps, increasing the total notional amount to HK$2,600.0 million, representing 41.9% of total outstanding bank borrowings[25][41] Profitability and Distributable Income The Group recorded a net loss attributable to stapled security holders due to fair value losses, despite a significant increase in adjusted profit after tax - The Group recorded fair value losses of HK$143.3 million on investment properties and HK$27.3 million on derivative financial instruments[26] - Net loss attributable to stapled security holders was HK$142.2 million[26] - Excluding the impact of fair value changes, net profit after tax significantly increased by 560.5% to HK$28.4 million year-on-year[27] - Profit/(Loss) Attributable to Stapled Security Holders (HK$ million) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Net property income | 173.9 | 180.9 | -3.9% | | Fair value (decrease)/increase of investment properties | (143.3) | 37.4 | N/A | | Fair value changes of derivative financial instruments | (27.3) | 15.9 | N/A | | Finance costs | (137.7) | (162.8) | -15.4% | | (Loss)/Profit attributable to stapled security holders | (142.2) | 43.0 | N/A | | Profit attributable to stapled security holders (excluding fair value changes) | 28.4 | 4.3 | 560.5% | - Total distributable income for H1 2025 was HK$28.0 million, a 17.6% decrease from the prior year period[30][31] - The Board decided not to declare any interim distribution for H1 2025[31] Hotel Operating Performance The hotel portfolio's total revenue decreased, with Langham and Cordis outperforming the Grade A luxury market, while Eaton HK exceeded the Grade B luxury market - Hotel Portfolio Revenue Breakdown (HK$ million) | Revenue Detail | The Langham Hong Kong | Cordis Hong Kong | Eaton HK | Total | Year-on-year Change (Total) | | :--- | :--- | :--- | :--- | :--- | :--- | | Rooms | 150.4 | 172.4 | 84.5 | 407.3 | -1.9% | | Food & Beverage | 94.8 | 125.4 | 90.7 | 310.9 | -8.2% | | Other | 2.4 | 8.1 | 8.8 | 19.3 | 3.2% | | Total Revenue | 247.6 | 305.9 | 184.0 | 737.5 | -4.6% | - Hotel Portfolio Operating Metrics | Hotel | Occupancy (H1 2025) | Average Room Rate (HK$) (H1 2025) | RevPAR (HK$) (H1 2025) | Occupancy (Y-o-Y Change) | Average Room Rate (Y-o-Y Change) | RevPAR (Y-o-Y Change) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | The Langham Hong Kong | 85.6% | 1,950 | 1,669 | -2.1 percentage points | +0.2% | -2.2% | | Cordis Hong Kong | 89.2% | 1,596 | 1,424 | -3.1 percentage points | – | -3.3% | | Eaton HK | 90.1% | 1,114 | 1,003 | +1.6 percentage points | +1.9% | +3.7% | | Hotel Portfolio | 88.4% | 1,561 | 1,379 | -1.4 percentage points | +0.1% | -1.5% | - RevPAR for The Langham Hong Kong and Cordis Hong Kong decreased by 2.2% and 3.3%, respectively, outperforming the 7.9% decline in the Grade A luxury hotel market[34] - RevPAR for Eaton HK increased by 3.7% year-on-year, surpassing the 6.6% decline in the Grade B luxury hotel market[35] - Eaton HK led the hotel portfolio with a high occupancy rate of 90.1%[38] Financial Review Net asset value per stapled security decreased, while the gearing ratio slightly increased, with a significant portion of borrowings hedged by interest rate swaps - Net asset value attributable to stapled security holders was HK$9,310.0 million or HK$2.70 per stapled security as of June 30, 2025[39] - Total outstanding borrowings (before underwriting fees) slightly decreased to HK$6,201.6 million[40] - 41.9% of total outstanding bank borrowings were hedged at a weighted average fixed interest rate swap of 3.59% per annum[41] - The gearing ratio was 38.5%, a slight increase from 38.2% as of December 31, 2024[41] - The Group held cash balances of HK$241.2 million and undrawn revolving loan facilities of HK$598.4 million[42] - Restricted bank deposits of HK$51.0 million were maintained to meet the minimum interest coverage ratio required by bank financing agreements[42] Biographies of Directors This section provides brief biographies of the Board of Directors, including their roles, experience, and affiliations - Dr. Lo Ka Shui serves as Chairman and Non-executive Director, also holding the position of Chairman and Managing Director of Great Eagle Holdings Limited[45] - Mr. Brett Stephen BUTCHER serves as Chief Executive Officer and Executive Director, with over forty years of experience in hotel operations[47] - Professor Chan Ka Keung, Professor Lin Hsiaohui, and Mr. Wong Kwai Lam serve as Independent Non-executive Directors, each possessing extensive experience in finance, academia, and business[48][50][54] - Mr. Lo Chun Him and Mr. Lo Chun Lai serve as Non-executive Directors, holding key positions within Great Eagle Holdings Limited and Langham Hospitality Group, and are related to Dr. Lo Ka Shui[52][53] Governance and Compliance This section outlines the Trust Group's corporate governance framework, compliance with codes, and mechanisms for handling potential conflicts of interest and connected transactions Corporate Governance Structure and Code Compliance The Trust Group maintains high corporate governance standards, with Langham Hospitality Investments structured as a fixed single investment trust - The Trust Group is committed to maintaining and enhancing high standards of corporate governance practices[57] - Langham Hospitality Investments is a fixed single investment trust established under a trust deed, permitted to invest only in the company's securities[58] - Stapled securities comprise one trust unit, one beneficial interest in an ordinary share, and one stapled preference share, which can only be traded together[59][60] - For the six months ended June 30, 2025, both the Trust and the Company complied with all applicable Code Provisions[61] Handling Potential Conflicts of Interest The Trust Group addresses potential conflicts of interest arising from its close relationship with Great Eagle Holdings through various corporate governance measures - The Trust Group maintains a close business relationship with Great Eagle Holdings Limited, governed by formal agreements, which may lead to potential conflicts of interest[62] - Great Eagle Holdings Limited has granted the Company a Right of First Refusal Deed, giving the Trust Group priority to participate in and acquire completed standalone hotels managed under The Langham or Eaton brands in Asia (excluding Australia and New Zealand)[62] - Corporate governance measures include directors abstaining from voting on transactions where they have a material interest, and the Trustee-Manager's directors prioritizing the overall interests of all stapled security holders over the Manager's interests[65] - Independent Non-executive Directors and auditors are required to conduct annual reviews and report on connected transactions[65] - The Audit Committee is responsible for overseeing the implementation of the Great Eagle Right of First Refusal Deed and annually reviewing its execution[64][65] Connected Transactions and Continuing Connected Transactions This section details connected and continuing connected transactions for H1 2025, including various agreements with Great Eagle Group and its subsidiaries - Total Connected Transactions for H1 2025 (HK$ thousand) | Transaction Type | Total Transaction Amount | | :--- | :--- | | Master Lease Agreement – Base Rent | 111,575 | | Master Lease Agreement – Variable Rent | 108,520 | | Hotel Management Agreement – Basic Fee | 11,062 | | Hotel Management Agreement – Incentive Fee | 9,523 | | Centralised Services and Marketing Agreement – Reimbursed Costs | 3,631 | | Centralised Services and Marketing Agreement – Global Marketing Fees | 8,147 | | Centralised Services and Marketing Agreement – Reservation Fees | 5,059 | | Trademark Licence Agreement | 7,374 | - The Master Lease Agreement stipulates that the Master Lessee pays the Lessor an annual fixed base rent of HK$225.0 million and variable rent calculated at 50% of the total gross operating profit of the hotels[69][70] - The Hotel Management Agreement specifies that the Hotel Manager receives a basic fee (1.5% of gross revenue) and an incentive fee (5.0% of adjusted gross operating profit)[72][74] - The Centralised Services and Marketing Agreement provides for the service provider to receive global marketing fees (2.0% of total room revenue) and reservation fees[75][76] - The Trademark Licence Agreement requires the hotel companies to pay a license fee (1.0% of gross revenue)[77] - Hotel management fees can be paid in cash, by issuing stapled securities, or a combination of both, with the stapled securities issuance cap increased from 1.5% to 3.5%[73][78] Disclosure of Interests This section details the issued stapled securities, directors' interests in stapled securities and associated corporations, and major stapled security holders' interests Issued Stapled Securities As of June 30, 2025, the total number of issued stapled securities was 3,444,141,132, an increase primarily for hotel manager fees - As of June 30, 2025, the total number of issued stapled securities was 3,444,141,132[79][81] - 10,594,487 new stapled securities were issued in H1 2025, representing 0.31% of the total, for partial payment of hotel manager fees for H2 2024[79][80] - 46,320,885 deferred stapled securities will be issued over three years to pay a portion of hotel manager fees[81] - For the six months ended June 30, 2025, neither the Trust, the Trustee-Manager, the Company, nor its subsidiaries repurchased, sold, or redeemed any stapled securities[82] Directors' Interests in Stapled Securities and Associated Corporations Dr. Lo Ka Shui holds a significant interest in Langham Hospitality Investments, with other directors holding minor personal interests, and interests in associated corporations are also disclosed - Directors' Long Positions in Stapled Securities (as of June 30, 2025) | Director Name | Capacity | Nature of Interest | Number of Stapled Securities Held | Percentage of Issued Stapled Securities | | :--- | :--- | :--- | :--- | :--- | | Lo Ka Shui | Beneficial Owner | Personal Interest | 31,584,000 | 0.92% | | | Interest in Controlled Corporations | Corporate Interest | 2,505,361,939 | 72.74% | | | Grantor, Advisory Committee and Management Committee Member of Charitable Trust | Trust Interest | 90,010,250 | 2.61% | | Brett Stephen BUTCHER | Beneficial Owner and Jointly Held with Spouse | Joint Interest | 2,170,545 | 0.06% | | Lo Chun Lai | Beneficial Owner | Personal Interest | 300,000 | 0.01% | - Dr. Lo Ka Shui in Great Eagle Holdings Limited holds a 64.38% interest, including personal, controlled corporation, and discretionary trust interests[89] - Dr. Lo Ka Shui in Champion REIT holds a 70.76% interest[91] Major Stapled Security Holders' Interests As of June 30, 2025, Great Eagle Holdings Limited is the major stapled security holder, with LHIL Assets Holdings Limited and HSBC International Trustee Limited also holding significant interests - Major Stapled Security Holders' Interests (as of June 30, 2025) | Name | Number of Stapled Securities Held | Percentage of Issued Stapled Securities | | :--- | :--- | :--- | | Great Eagle Holdings Limited | 2,502,271,939 | 72.65% | | LHIL Assets Holdings Limited | 2,358,327,439 | 68.47% | | HSBC International Trustee Limited | 2,448,103,067 | 71.08% | - Great Eagle Holdings Limited indirectly holds the majority of stapled securities through its wholly-owned subsidiaries[95] Financial Information This section presents the condensed consolidated financial statements, including the review report, statements of profit or loss, financial position, changes in equity, cash flows, and detailed notes Review Report on Condensed Consolidated Financial Statements Deloitte Touche Tohmatsu reviewed the Trust Group's condensed consolidated financial statements for H1 2025, finding no material issues and compliance with HKAS 34 - Deloitte Touche Tohmatsu has reviewed the Trust Group's condensed consolidated financial statements[102] - The financial statements are prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' issued by the Hong Kong Institute of Certified Public Accountants[102] - The review found no matters that caused the accountants to believe the condensed consolidated financial statements were not prepared, in all material respects, in accordance with HKAS 34[104] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For H1 2025, the Trust Group reported revenue of HK$184,823 thousand, a net loss of HK$142,254 thousand attributable to stapled security holders, and a basic and diluted loss per stapled security of 4 HK cents - Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (for the six months ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Revenue | 184,823 | 191,166 | | Net property income | 173,916 | 180,956 | | Fair value (decrease)/increase of investment properties | (143,327) | 37,373 | | Fair value changes of derivative financial instruments | (27,317) | 15,912 | | Finance costs | (137,726) | (162,843) | | (Loss)/Profit before tax | (136,617) | 50,705 | | Total (expense)/income and comprehensive (expense)/income for the period attributable to stapled security holders | (142,254) | 43,020 | | (Loss)/Earnings per stapled security (basic and diluted) | (4 HK cents) | 1 HK cent | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets were HK$16,087,429 thousand, with investment properties at HK$15,764,000 thousand, and net assets at HK$9,310,045 thousand - Condensed Consolidated Statement of Financial Position (as of June 30, 2025) | Metric | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Non-current assets | 15,773,150 | 15,904,746 | | Investment properties | 15,764,000 | 15,895,000 | | Current assets | 314,279 | 333,598 | | Current liabilities | 104,052 | 87,180 | | Non-current liabilities | 6,673,332 | 6,648,753 | | Secured bank loans (due after one year) | 6,168,404 | 6,164,604 | | Net assets | 9,310,045 | 9,502,411 | Condensed Consolidated Statement of Changes in Equity For H1 2025, the Group's total equity decreased from HK$9,502,411 thousand to HK$9,310,045 thousand, primarily due to the period's loss and distributions paid - Condensed Consolidated Statement of Changes in Equity (for the six months ended June 30, 2025) | Metric | June 30, 2025 (HK$ thousand) | January 1, 2025 (HK$ thousand) | | :--- | :--- | :--- | | Share capital/units | 3,444 | 3,434 | | Share premium | 8,275,787 | 8,325,924 | | Other reserves | (11,562,543) | (11,562,543) | | Share-based payment reserve | 15,850 | 15,835 | | Property revaluation reserve | 12,598,157 | 12,598,157 | | (Accumulated losses)/Retained profits | (20,650) | 121,604 | | Total Equity | 9,310,045 | 9,502,411 | - Total loss and comprehensive expense for the period was HK$142,254 thousand[109] - Distributions paid amounted to HK$55,106 thousand[109] Condensed Consolidated Statement of Cash Flows For H1 2025, net cash from operating activities was HK$66,750 thousand, while net cash used in investing and financing activities totaled HK$60,357 thousand and HK$58,562 thousand, respectively - Condensed Consolidated Statement of Cash Flows (for the six months ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Net cash from operating activities | 66,750 | 71,657 | | Net cash used in investing activities | (60,357) | (25,930) | | Cash used in financing activities | (58,562) | (556) | | Net (decrease)/increase in cash and cash equivalents | (52,169) | 45,171 | | Cash and cash equivalents at end of period | 241,233 | 167,687 | - Additions to investment properties amounted to HK$13,417 thousand, and restricted bank deposits were HK$51,000 thousand[111] - Distributions paid were HK$55,106 thousand, and bank loans repaid totaled HK$3,000 thousand[111] Notes to the Condensed Consolidated Financial Statements This section provides detailed notes to the condensed consolidated financial statements, covering general information, accounting policies, revenue, segments, finance costs, tax, distributable income, earnings per stapled security, investment property valuation, balance sheet items, commitments, operating leases, and related party disclosures General Information and Basis of Presentation Langham Hospitality Investments is a trust listed on May 30, 2013, primarily engaged in property investment, with financial statements presented in HKD - Langham Hospitality Investments is a trust whose stapled securities were listed on the Stock Exchange on May 30, 2013[112] - The Trust Group's principal business activity is property investment[113] - The condensed consolidated financial statements are presented in Hong Kong Dollars and include the financial position of both the Trust Group and the Company Group[114][115] Significant Accounting Policies and Application The condensed consolidated financial statements are prepared under HKAS 34 and Appendix 16 of the Listing Rules, primarily on a historical cost basis, with no material impact from new accounting standards - The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' and Appendix 16 of the Listing Rules[117] - They are prepared on a historical cost basis, except for investment properties and derivative financial instruments, which are measured at fair value[118] - The revised HKAS 21 'Lack of Exchangeability' was first applied in the current period, but it had no material impact on the financial position and performance[119] Revenue and Segment Information The Group's revenue primarily derives from rental income from the Master Lessee and retail shops, with operating segments focused on the performance of its three Hong Kong hotels - Revenue Breakdown (for the six months ended June 30) | Revenue Source | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Rental income from GE (LHIL) Lessee Limited (after service fee expenses) | 183,989 | 190,240 | | Rental income from retail shops at Eaton HK | 834 | 926 | | Total Revenue | 184,823 | 191,166 | - The Group's operating segments are focused on the operating results of leasing The Langham Hong Kong, Cordis Hong Kong, and Eaton HK[121] - Segment Revenue and Results (for the six months ended June 30, 2025) | Hotel | Segment Revenue (HK$ thousand) | Segment Results (HK$ thousand) | | :--- | :--- | :--- | | The Langham Hong Kong | 77,631 | 62,316 | | Cordis Hong Kong | 97,100 | 75,866 | | Eaton HK | 46,198 | 35,734 | | Total Segments | 220,929 | 173,916 | - As of the end of the reporting period, the fair values of The Langham Hong Kong, Cordis Hong Kong, and Eaton HK were HK$5,410 million, HK$6,770 million, and HK$3,584 million, respectively[125] Finance Costs and Income Tax Expense Total finance costs for H1 2025 were HK$137,726 thousand, primarily from bank borrowings and interest rate swaps, with income tax expense at HK$5,637 thousand - Finance Costs Breakdown (for the six months ended June 30) | Finance Costs | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Interest on bank borrowings | 122,155 | 162,063 | | Net interest on interest rate swaps | 8,346 | (4,151) | | Amortisation of underwriting/loan extension fees | 6,800 | 4,685 | | Total Finance Costs | 137,726 | 162,843 | - Income Tax Expense (for the six months ended June 30) | Income Tax Expense | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Hong Kong Profits Tax (current tax) | 2,185 | 1,246 | | Deferred tax | 3,452 | 6,430 | | Total Income Tax Expense | 5,637 | 7,685 | Distributable Income and Distribution Statement Total distributable income for H1 2025 was HK$28,027 thousand, a decrease from the prior year, with no interim distribution declared for the period - Calculation of Total Distributable Income (for the six months ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | (Loss)/Profit for the period attributable to stapled security holders | (142,254) | 43,020 | | Fair value decrease/(increase) of investment properties | 143,327 | (37,373) | | Fair value changes of derivative financial instruments | 27,317 | (15,912) | | Furniture, fixtures and equipment reserve | (11,062) | (11,593) | | Total Distributable Income | 28,027 | 34,022 | - The Board decided not to declare any interim distribution for the six months ended June 30, 2025[131] - The 2024 final distribution of 1.6 HK cents per stapled security, totaling HK$55,106 thousand, was paid to stapled security holders on June 4, 2025[131] Earnings Per Stapled Security For H1 2025, basic and diluted loss per stapled security was 4 HK cents, compared to earnings of 1 HK cent in the prior year period - Basic and Diluted (Loss)/Earnings Per Stapled Security (for the six months ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | (Loss)/Profit for the period (HK$ thousand) | (142,254) | 43,020 | | Weighted average number of stapled securities (thousand) | 3,440,746 | 3,361,407 | | Basic and Diluted (Loss)/Earnings Per Stapled Security | (4 HK cents) | 1 HK cent | Investment Properties As of June 30, 2025, the Group's investment properties had a fair value of HK$15,764,000 thousand, valued by Knight Frank using discounted cash flow and term and reversion methods - Fair Value Changes of Investment Properties (HK$ thousand) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Fair value at beginning of period/year | 15,895,000 | 15,662,000 | | Additions | 12,327 | 46,474 | | Fair value (decrease)/increase recognised in profit or loss | (143,327) | 186,526 | | Fair value at end of period/year | 15,764,000 | 15,895,000 | - The fair value of investment properties was assessed by independent professional property valuer Knight Frank Petty Limited[137] - Hotel properties were valued using the discounted cash flow analysis, while retail shops were valued using the term and reversion method[138][139] Notes to Statement of Financial Position Items This section details accounts receivable, restricted bank deposits, accounts payable, derivative financial instruments, secured bank loans, and issued share capital - Accounts Receivable, Deposits and Prepayments (HK$ thousand) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Amounts due from Master Lessee | 13,314 | 29,417 | | Deposits and prepayments | 8,989 | 11,299 | | Total classified as current | 14,579 | 32,678 | - Restricted bank deposits of HK$51,000 thousand are held to maintain the minimum interest coverage ratio required by bank financing agreements[144] - Accounts Payable, Deposits and Accruals (HK$ thousand) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trade payables | 50,895 | 34,498 | | Accruals and other payables | 13,461 | 23,440 | | Total | 65,844 | 61,131 | - Derivative financial instruments are all interest rate swaps with a total notional amount of HK$2,600,000 thousand, used to manage interest rate risk[147][148] - Total secured bank loans amount to HK$6,201,600 thousand, bearing interest at HIBOR plus 0.82%, and are due in December 2027[149][150] - The total number of issued stapled securities is 3,444,141,132[152][153] Commitments and Operating Leases As of June 30, 2025, the Group had no significant capital expenditure commitments, with minimum operating lease receivables from the Master Lessee and other tenants - As of June 30, 2025, the Group had no significant capital expenditure commitments[156] - Minimum Operating Lease Receivables (HK$ thousand) | Lessee | Within 1 year | In 2nd year | In 3rd year | Total | | :--- | :--- | :--- | :--- | :--- | | From Master Lessee | 225,000 | 205,274 | – | 430,274 | | From other tenants | 1,300 | 981 | 582 | 2,863 | - The lease term with the Master Lessee is fourteen years, with a fixed base rent of HK$225,000 thousand annually and variable rent calculated at 50% of the total gross operating profit[159] Related and Connected Party Disclosures The Group engaged in various significant related and connected party transactions with Great Eagle Group and its subsidiaries during the period, including rental income, management fees, and administrative services - The Group entered into several significant related and connected party transactions with subsidiaries of Great Eagle Holdings Limited (the ultimate holding company)[160] - Related and Connected Party Transactions (for the six months ended June 30) | Transaction Type | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Rental income (Master Lessee) | 220,095 | 228,111 | | Hotel management fees and license fees (Langham Hospitality International Limited) | 27,959 | 29,563 | | Global marketing fees (Langham Hospitality Services Limited) | 8,147 | 8,308 | | Property management service fees (Kinsland Property Management Services Limited) | 1,530 | 1,529 | | Administrative support service fees (Great Eagle Company, Limited) | 480 | 480 | - Hotel management fees and license fees will be paid in cash (compared to stapled securities in the prior year period)[163] - Remuneration for directors and other key management personnel was HK$924 thousand in H1 2025, a decrease from HK$1,811 thousand in H1 2024[165] Review Report on Condensed Financial Statements of Langham Hospitality Investments Management Limited Deloitte Touche Tohmatsu reviewed Langham Hospitality Investments Management Limited's condensed financial statements for H1 2025, finding no material issues and compliance with HKAS 34 - Deloitte Touche Tohmatsu has reviewed the condensed financial statements of Langham Hospitality Investments Management Limited[171] - The financial statements are prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' issued by the Hong Kong Institute of Certified Public Accountants[171] - The review found no matters that caused the accountants to believe the condensed financial statements were not prepared, in all material respects, in accordance with HKAS 34[173] Condensed Statement of Profit or Loss and Other Comprehensive Income of Langham Hospitality Investments Management Limited For H1 2025, Langham Hospitality Investments Management Limited reported zero revenue and profit/loss, as administrative expenses are borne by affiliated companies and the Trust - Condensed Statement of Profit or Loss and Other Comprehensive Income of Langham Hospitality Investments Management Limited (for the six months ended June 30) | Metric | 2025 (HK$) | 2024 (HK$) | | :--- | :--- | :--- | | Revenue | – | – | | Administrative expenses | 11,857 | 11,857 | | Less: Amounts borne by fellow subsidiaries and the Trust | (11,857) | (11,857) | | Profit or loss before tax | – | – | | Total profit or loss and comprehensive income/expense for the period | – | – | Condensed Statement of Financial Position of Langham Hospitality Investments Management Limited As of June 30, 2025, Langham Hospitality Investments Management Limited's current assets, net assets, and share capital all stood at HK$1, reflecting its lean financial structure as a trust manager - Condensed Statement of Financial Position of Langham Hospitality Investments Management Limited (as of June 30, 2025) | Metric | June 30, 2025 (HK$) | December 31, 2024 (HK$) | | :--- | :--- | :--- | | Current assets (cash) | 1 | 1 | | Net assets | 1 | 1 | | Share capital | 1 | 1 | | Total Equity | 1 | 1 | Condensed Statement of Changes in Equity of Langham Hospitality Investments Management Limited For H1 2025, Langham Hospitality Investments Management Limited's share capital remained unchanged at HK$1 - Condensed Statement of Changes in Equity of Langham Hospitality Investments Management Limited (for the six months ended June 30) | Metric | Share Capital (HK$) | | :--- | :--- | | January 1, 2024 (audited) and June 30, 2024 (unaudited) | 1 | | January 1, 2025 (audited) and June 30, 2025 (unaudited) | 1 | Notes to the Condensed Financial Statements of Langham Hospitality Investments Management Limited This section provides notes to the financial statements of Langham Hospitality Investments Management Limited, detailing its role as Trustee-Manager, its zero revenue, and its lean financial structure - Langham Hospitality Investments Management Limited's principal business is acting as the Trustee-Manager of the Trust[181] - The Company does not charge any fees for managing the Trust, with administrative costs borne by the Trust estate[181] - The Company had no revenue and no cash transactions during both periods, hence no condensed statement of cash flows is presented[182][183] - The condensed financial statements are prepared in accordance with HKAS 34, with the first-time application of revised HKAS 21 having no material impact[184][187] - The Company had no assessable profits during both periods, and its share capital remained at HK$1[188][189] Glossary This section provides definitions for key terms and acronyms used throughout the interim report - This section provides definitions for key terms and acronyms used throughout the interim report[192] - Terms include 'Board', 'Codes on Takeovers and Mergers', 'Company', 'Corporate Governance Code', 'Deferred Stapled Securities', 'Great Eagle', 'Great Eagle Group', 'Great Eagle Right of First Refusal Deed', 'Group', 'HKAS', 'HKEX', 'HKFRS', 'HKICPA', 'Stapled Security Holders', 'Hong Kong', 'Hotel Companies', 'Hotel Manager', 'Hotels', 'Listing Date', 'Listing Rules', 'Master Lessee', 'Model Code', 'RevPAR', 'SFO', 'Stapled Securities', 'Stock Exchange', 'Trust', 'Trust Deed', 'Trust Group', 'Trustee-Manager', and 'Trustee-Manager Board'[192][193]