华大酒店(00201) - 2025 - 中期财报

Company Information The company's board comprises executive, non-executive, and independent non-executive directors, supported by a company secretary, auditor, lawyer, and key banking partners - The company's board of directors consists of executive directors including Mr. Cheng Kai Man (Chairman), Mr. Hui Wing Ho, Ms. Lau Kam Mei, and Ms. Ng Yuet Ying; non-executive directors including Ms. Lui Fung Mei Yee; and independent non-executive directors including Mr. Chan Kim Fai, Mr. Lam Kwai Cheung, and Mr. Liu Yuk Chor[4] - The company secretary is Ms. Koo Ching Fun, the auditor is Deloitte Touche Tohmatsu, the legal advisor is Withers LLP, and principal bankers include The Hongkong and Shanghai Banking Corporation Limited and Bank of China (Hong Kong) Limited[4] Interim Results Summary This section highlights a 43% increase in net profit attributable to owners, excluding revaluation and depreciation, and the board's decision not to declare an interim dividend Interim Results For the six months ended June 30, 2025, net profit attributable to owners, after tax and before revaluation and depreciation of land, property, and equipment, increased by 43% year-on-year to HKD 59.3 million Net Profit Attributable to Owners (Excluding Revaluation and Depreciation) | Metric | For the six months ended June 30, 2025 (HKD) | For the six months ended June 30, 2024 (HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Net profit | 59,300,000 | 41,600,000 | +43% | Interim Dividend The board does not recommend an interim dividend for the six months ended June 30, 2025, prioritizing cash flow for unstable hotel market conditions, debt reduction, and London Wood Street Hotel renovations - The board does not recommend an interim dividend for the six months ended June 30, 2025 (2024: nil)[6] - Reasons for not distributing dividends include ensuring higher cash flow to navigate challenging economic conditions with high operating and interest costs in the hotel industry; retaining cash to further reduce bank and shareholder loans; and reserving cash for the renovation of the Wood Street Hotel in London[6] Management Discussion and Analysis This section provides an in-depth analysis of the group's business operations, financial performance, revenue drivers, cost structure, financing, key achievements, and future strategic outlook Business Overview The Group continued its engagement in hotel investment, hotel management, property leasing, and property development, achieving a 43% year-on-year increase in net profit attributable to owners, excluding revaluation and depreciation - The Group's principal businesses include hotel investment, hotel management, property leasing, and property development[7] Net Profit Attributable to Owners (Excluding Revaluation and Depreciation) | Metric | For the six months ended June 30, 2025 (HKD) | For the six months ended June 30, 2024 (HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Net profit | 59,300,000 | 41,600,000 | +43% | Financial Performance For the six months ended June 30, 2025, the Group's overall profit significantly increased by 81%, driven by a 5% revenue increase and reduced hotel operating and finance costs Key Financial Performance Indicators | Metric | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Profit from hotel operations | 8,631 | 712 | +1,112% | | Profit from property investment | 20,380 | 14,010 | +45% | | Income from securities investment | 25 | – | N/A | | Administrative expenses | (22,205) | (23,159) | -4% | | Finance costs | (17,177) | (23,228) | -26% | | Loss after tax | (15,385) | (32,546) | -53% | | Net profit attributable to owners after tax and before revaluation and depreciation of land, property and equipment | 59,295 | 41,562 | +43% | - Overall profit increased by 81%, primarily due to a 5% increase in revenue and a reduction in hotel operating and finance costs[8] Revenue Analysis The Group's total revenue increased by 5% year-on-year to HKD 258 million, driven by a 3% rise in hotel operations revenue (due to increased room rates) and a 34% increase in investment property income (from London Royal Scot Hotel rent) Revenue Composition and Changes | Revenue Source | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | Change (%) | Primary Reason | | :--- | :--- | :--- | :--- | :--- | | Revenue from hotel operations | 231,238 | 224,959 | +3% | Increased room rates | | Revenue from investment properties | 25,380 | 19,010 | +34% | Increased rental income from London Royal Scot Hotel | | Other income | 1,640 | 2,182 | -25% | N/A | | Total | 258,258 | 246,151 | +5% | | - The Group's total revenue increased by 5% year-on-year, from approximately HKD 246 million to approximately HKD 258 million[9] Hotel Operations Performance The Group operates seven hotels and leases one in London, with hotel operations revenue growing by 3%, while the London Royal Scot Hotel's annual rent increased by 34% to GBP 4,737,000, and most hotels maintained over 90% average room occupancy - The Group currently owns eight hotels, operating seven and leasing one located in London[10] Average Room Occupancy Rate of Key Hotels (Jan-Jun 2025) | Hotel Name | Average Room Occupancy Rate (%) | | :--- | :--- | | Ramada Hong Kong Harbour View | 98 | | Ramada Hong Kong Grand | 99 | | Best Western Plus Hotel Hong Kong | 97 | | Grand View Hotel Causeway Bay | 99 | | Best Western Plus Hotel Tsim Sha Tsui | 98 | | Grand View Hotel Bay | 98 | | Shanghai Grand International Hotel | 88 | - The annual rent for the London Royal Scot Hotel successfully increased by 34%, from GBP 3,546,000 to GBP 4,737,000[11] Cost Analysis During the period, hotel service costs decreased by 2% to HKD 151.9 million, administrative expenses (excluding depreciation) decreased by 4% to HKD 21 million, while hotel property depreciation slightly increased Hotel Service Costs | Metric | For the six months ended June 30, 2025 (Million HKD) | For the six months ended June 30, 2024 (Million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Hotel service costs | 151.9 | 154.6 | -2% | Administrative Expenses and Depreciation | Metric | For the six months ended June 30, 2025 (Million HKD) | For the six months ended June 30, 2024 (Million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Administrative expenses (excluding depreciation) | 21.0 | 22.3 | -4% | | Depreciation of hotel properties | 68.2 | 68.0 | +0.3% | Financing Status The Group's total debt decreased by HKD 64 million to HKD 636 million, with the gearing ratio falling to 15%, and finance costs reduced by 26% due to lower interest rates, though foreign exchange risk remains Debt Structure and Changes | Metric | As at June 30, 2025 (Million HKD) | As at December 31, 2024 (Million HKD) | Change (Million HKD) | | :--- | :--- | :--- | :--- | | Bank loans | 301 | 345 | -44 | | Shareholder loans | 335 | 355 | -20 | | Total debt | 636 | 700 | -64 | | Gearing ratio | 15% | 17% | -2% | Finance Costs | Metric | For the six months ended June 30, 2025 (Million HKD) | For the six months ended June 30, 2024 (Million HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Total interest expense | 17.2 | 23.2 | -26% | | Interest expense on bank loans | 8.2 | 10.8 | -24% | | Interest expense on shareholder loans | 9.0 | 12.4 | -27% | - The decrease in finance costs was primarily due to lower interest rates[17] - The Group's bank loans are primarily denominated in HKD and GBP, bearing interest at floating rates, thus exposing the Group to foreign exchange risk[17] Key Business Achievements Despite visitor numbers and per capita spending not fully recovering, the Group maintained over 90% average hotel occupancy, achieved a 5% total revenue increase, successfully raised London Royal Scot Hotel's annual rent by 34%, and plans renovation for London Wood Street Hotel Overnight Visitor Arrivals to Hong Kong Data | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Pre-pandemic H1 2019 | | :--- | :--- | :--- | :--- | | Overnight visitor arrivals (persons) | Approx. 11.3 million | 10.6 million | 15 million | | Per capita spending by Mainland Chinese visitors (HKD) | Below 5,100 | N/A | 6,000 | - The Group's average hotel occupancy rate consistently exceeded 90%[19] - The Group's hotel revenue increased by 3% to HKD 231 million, and total revenue increased by 5% to HKD 258 million[19] - The annual rent for the London Royal Scot Hotel successfully increased by 34% from GBP 3,546,000 to GBP 4,737,000[20] - The London Wood Street Hotel (former police headquarters) has been approved for renovation into a luxury hotel with approximately 216 rooms[20] Future Outlook The Group holds eight hotels and the London Wood Street Hotel renovation project, facing challenges from a weak Chinese economy and expensive HKD against RMB, but multi-entry visa policies in other major Chinese cities offer encouraging prospects, with management focused on increasing revenue and controlling costs - The Group holds eight revenue-generating hotels (six in Hong Kong, one in Shanghai, and one in London) and the renovation project for the Wood Street Hotel in London[21] - The future outlook faces challenges from a weak Chinese economy and an expensive HKD against RMB, leading more Mainland Chinese visitors to opt for overnight stays in the Greater Bay Area and day trips to Hong Kong[21] - The further implementation of multi-entry visa policies in other major Chinese cities is expected to bring encouraging prospects for the future[21] - Management will continue efforts to increase revenue and control costs to address challenges in hotel operations and rental income[21] Disclosures Relating to Listed Securities This section details the absence of listed securities transactions by the company, outlines directors' interests, and identifies major shareholders and their respective holdings Purchase, Sale or Redemption of Listed Securities For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the period[22] Directors' Interests in Listed Securities As of June 30, 2025, Chairman Mr. Cheng Kai Man held a 71.09% equity interest in the Company through his controlled entities and had controlling interests in associated corporations like Magnificent Hotel Investments Limited, Magnificent Realty Investment Holdings Limited, and Magnificent Assets Holdings Limited Directors' Interests in the Company's Shares | Director's Name | Capacity | Nature of Interest | Number of Shares/Underlying Shares Held | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | :--- | | Cheng Kai Man | Interest in controlled corporation | Corporate | 6,360,585,437 | 71.09 | - Mr. Cheng Kai Man holds controlling interests in Magnificent Hotel Investments Limited, Good Taylor Limited, South Point Investments Limited, Magnificent Network Development Limited, and Jetco Construction Company Limited, which collectively hold 71.09% of the Company's shares[23] Directors' Interests in Shares of Associated Corporations | Director's Name | Name of Associated Corporation | Capacity | Nature of Interest | Number of Shares/Underlying Shares Held | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | :--- | :--- | | Cheng Kai Man | Magnificent Hotel Investments Limited | Beneficial owner and interest in controlled corporation | Personal and Corporate | 385,395,999 | 66.48 | | Cheng Kai Man | Magnificent Realty Investment Holdings Limited | Beneficial owner and interest in controlled corporation | Personal and Corporate | 226,454,825 | 74.40 | | Cheng Kai Man | Magnificent Assets Holdings Limited | Beneficial owner | Personal | 2 | 100.00 | Major Shareholders As of June 30, 2025, Magnificent Hotel Investments Limited and its associated companies (including Omnico Company Inc., Magnificent Realty Investment Holdings Limited, and Magnificent Assets Holdings (BVI)) collectively held 71.09% of the Company's shares as the largest shareholder, with Alef United Holdings Limited and its concert parties holding 9.89% Major Shareholders' Shareholding | Shareholder Name | Capacity | Number of Shares/Underlying Shares Held (L) | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Magnificent Hotel Investments Limited | Beneficial owner and interest in controlled corporation | 6,360,585,437 | 71.09 | | Omnico Company Inc. | Interest in controlled corporation | 6,360,585,437 | 71.09 | | Magnificent Realty Investment Holdings Limited | Interest in controlled corporation | 6,360,585,437 | 71.09 | | Magnificent Assets Holdings (BVI) | Interest in controlled corporation | 6,360,585,437 | 71.09 | | Li Pui Ling | Interest of spouse | 6,360,585,437 | 71.09 | | Jetco | Beneficial owner | 2,978,198,581 | 33.29 | | Alef United Holdings Limited | Beneficial owner and interest of parties acting in concert | 885,094,524 | 9.89 | | Credit Suisse Trust Limited | Interest in controlled corporation | 885,094,524 | 9.89 | | Hashim Majed Hashim A. | Interest in controlled corporation | 885,094,524 | 9.89 | | North Salomon Limited | Interest in controlled corporation | 885,094,524 | 9.89 | | Saray Capital Limited | Interest in controlled corporation | 885,094,524 | 9.89 | | Saray Value Fund SPC | Beneficial owner and interest of parties acting in concert | 885,094,524 | 9.89 | | Shobokshi Hussam Ali H. | Interest in controlled corporation | 885,094,524 | 9.89 | - Magnificent Hotel Investments Limited, Omnico, Magnificent Realty Investment Holdings Limited, and Magnificent Assets Holdings (BVI) are deemed to have an interest in 71.09% of the Company's shares due to their direct or indirect interests in Magnificent Hotel Investments Limited[28] - Alef United Holdings Limited and Saray Value Fund SPC, along with other parties acting in concert, collectively hold a 9.89% equity interest in the Company[29] Review Report and Corporate Governance This section details the independent review of interim results, the company's compliance with corporate governance codes, and the auditor's review report on the condensed consolidated financial statements Independent Review The interim results for the six months ended June 30, 2025, were reviewed by Deloitte Touche Tohmatsu in accordance with Hong Kong Standard on Review Engagements 2410 and by the Group's audit committee - The interim results are unaudited but have been reviewed by Deloitte Touche Tohmatsu in accordance with Hong Kong Standard on Review Engagements 2410[31] - The interim results and interim report have been reviewed by the Group's audit committee[31] Corporate Governance The Company complied with the Corporate Governance Code, with a deviation where the Chairman and CEO roles are combined under Mr. Cheng Kai Man, an arrangement the board believes provides consistent leadership and cost savings, and all directors confirmed compliance with the Model Code for Securities Transactions - The Company has complied with all applicable code provisions of the Corporate Governance Code as set out in Appendix C1 to the Listing Rules of the Stock Exchange, save for one deviation[32] - Deviation from code provision C.2.1: The roles of Chairman and Chief Executive Officer are combined and performed by Mr. Cheng Kai Man, which the board believes provides strong and consistent leadership, facilitates strategy implementation, and achieves significant cost savings[32] - All directors have confirmed their compliance with the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 to the Listing Rules throughout the period[33] Review Report on Condensed Consolidated Financial Statements Deloitte Touche Tohmatsu reviewed the condensed consolidated financial statements in accordance with Hong Kong Standard on Review Engagements 2410, finding no matters suggesting non-compliance with Hong Kong Accounting Standard 34 - Deloitte Touche Tohmatsu has reviewed the condensed consolidated financial statements in accordance with Hong Kong Standard on Review Engagements 2410[36] - The review concluded that nothing has come to the reviewer's attention that causes them to believe the condensed consolidated financial statements are not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34[37] - As the scope of a review is substantially less than that of an audit, no audit opinion has been expressed[36] Condensed Consolidated Financial Statements This section presents the Group's condensed consolidated financial statements, including the statement of profit or loss, comprehensive income, financial position, changes in equity, and cash flows Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2025, the Group's total revenue grew to HKD 256.6 million, with gross profit significantly increasing to HKD 34.036 million, and despite lower finance and administrative costs, increased impairment of investment properties and income tax expense resulted in a reduced loss for the period of HKD 15.385 million Key Data from Condensed Consolidated Statement of Profit or Loss | Metric | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Total revenue | 256,643 | 243,969 | | Cost of sales | (2,105) | (1,641) | | Other service costs | (151,896) | (154,585) | | Depreciation of property, plant and equipment | (68,222) | (67,640) | | Gross profit | 34,036 | 19,722 | | Fair value loss on investment properties | (5,000) | (5,000) | | Administrative expenses | (22,205) | (23,159) | | Finance costs | (17,177) | (23,228) | | Loss before tax | (8,731) | (29,483) | | Income tax expense | (6,654) | (3,063) | | Loss for the period | (15,385) | (32,546) | | Basic loss per share (HK cents) | (0.17) | (0.36) | Condensed Consolidated Statement of Comprehensive Income The loss for the period was HKD 15.385 million, but a positive foreign exchange difference of HKD 121.2 million from translating overseas operations resulted in a total comprehensive income of HKD 93.545 million, a significant improvement from the prior period's total comprehensive expense Key Data from Condensed Consolidated Statement of Comprehensive Income | Metric | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Loss for the period | (15,385) | (32,546) | | Fair value loss on equity investments at fair value through other comprehensive income | (12,292) | (908) | | Exchange differences arising from translation of overseas operations | 121,222 | (13,773) | | Other comprehensive income (expense) for the period | 108,930 | (14,681) | | Total comprehensive income (expense) for the period | 93,545 | (47,227) | | Total comprehensive income (expense) attributable to owners of the Company | 93,732 | (47,041) | - Exchange differences arising from the translation of overseas operations amounted to HKD 121.2 million, significantly improving the total comprehensive income for the period[40] Condensed Consolidated Statement of Financial Position As of June 30, 2025, total assets slightly increased to HKD 5.025 billion, with investment properties and property, plant, and equipment as major non-current assets; current liabilities exceeded current assets, resulting in a net current liability of HKD 498.8 million, while total equity grew to HKD 4.2305 billion Key Data from Condensed Consolidated Statement of Financial Position | Metric | As at June 30, 2025 (Thousand HKD) | As at December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Property, plant and equipment | 3,613,123 | 3,633,234 | | Investment properties | 1,117,145 | 1,030,990 | | Total non-current assets | 4,831,395 | 4,777,882 | | Bank balances and cash | 174,354 | 203,139 | | Total current assets | 194,187 | 224,446 | | Total current liabilities | 693,064 | 761,854 | | Net current liabilities | (498,877) | (537,408) | | Total assets less current liabilities | 4,332,518 | 4,240,474 | | Equity attributable to owners of the Company | 4,224,058 | 4,130,326 | | Total equity | 4,230,507 | 4,136,962 | | Deferred tax liabilities | 100,885 | 102,506 | - Current liabilities exceeded current assets by HKD 498.8 million, but the board has carefully considered future liquidity and prepared the financial statements on a going concern basis, supported by internal financial resources, refinanced bank loans, and the immediate holding company's agreement not to demand repayment of amounts due[41][49] Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, equity attributable to owners of the Company increased from HKD 4.1303 billion to HKD 4.2241 billion, primarily driven by a positive foreign exchange difference of HKD 121.2 million from translating overseas operations, despite the loss for the period and fair value loss on equity investments Key Data from Condensed Consolidated Statement of Changes in Equity | Metric | As at January 1, 2025 (Thousand HKD) | Loss for the period (Thousand HKD) | Exchange differences (Thousand HKD) | Fair value loss on equity investments (Thousand HKD) | As at June 30, 2025 (Thousand HKD) | | :--- | :--- | :--- | :--- | :--- | :--- | | Equity attributable to owners of the Company | 4,130,326 | (15,198) | 121,222 | (12,292) | 4,224,058 | | Non-controlling interests | 6,636 | (187) | – | – | 6,449 | | Total | 4,136,962 | (15,385) | 121,222 | (12,292) | 4,230,507 | - Exchange differences arising from the translation of overseas operations, amounting to HKD 121.2 million, were the primary contributor to the increase in equity for the period[43] Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, net cash generated from operating activities was HKD 70.094 million, net cash used in investing activities was HKD 1.827 million, and net cash used in financing activities was HKD 105.384 million, resulting in a net decrease in cash and cash equivalents of HKD 37.117 million and an ending balance of HKD 174.354 million Key Data from Condensed Consolidated Statement of Cash Flows | Metric | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Net cash from operating activities | 70,094 | 61,969 | | Net cash used in investing activities | (1,827) | (7,278) | | Net cash used in financing activities | (105,384) | (212,400) | | Net decrease in cash and cash equivalents | (37,117) | (157,709) | | Cash and cash equivalents at end of period | 174,354 | 149,742 | - Net cash outflow from financing activities primarily included bank loan repayments of HKD 99.882 million and repayments of amounts due to the immediate holding company of HKD 26.831 million, offset by new bank loans of HKD 32 million[46] Notes to the Condensed Consolidated Financial Statements This section provides detailed notes explaining the basis of preparation, significant accounting policies, revenue breakdown, segment information, finance costs, income tax, loss for the period, dividends, loss per share, property details, receivables, payables, bank loans, share capital, related party transactions, pledges of assets, and fair value measurement of financial instruments Basis of Preparation The condensed consolidated financial statements are presented in HKD, prepared in accordance with Hong Kong Accounting Standard 34 and the Listing Rules, and despite current liabilities exceeding current assets, the board prepared them on a going concern basis, supported by internal financial resources, refinanced bank loans, and holding company support - These condensed consolidated financial statements are presented in HKD and prepared in accordance with Hong Kong Accounting Standard 34 and the applicable disclosure requirements of Appendix D2 to the Listing Rules of The Stock Exchange of Hong Kong Limited[47] - As at June 30, 2025, the Group's current liabilities exceeded its current assets by HKD 498.8 million, but the board believes the Group has financial resources to fund its operations, including internal financial resources and refinanced bank loans, and the immediate holding company has agreed not to demand repayment of amounts due, thus preparing the statements on a going concern basis[49] Principal Accounting Policies The condensed consolidated financial statements are prepared on a historical cost basis, applying all amendments to Hong Kong Financial Reporting Standards issued by the HKICPA, which had no significant impact on the financial position or performance - These condensed consolidated financial statements are prepared on the historical cost basis, except for investment properties and certain financial instruments which are measured at fair value where applicable[50] - The amendments to Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants that are effective for the current interim period have been applied for the first time, but they have had no significant impact on the Group's financial position and performance and/or disclosures[51] Revenue The Group's total revenue primarily comprises hotel operations revenue (HKD 231.2 million), property rental income (HKD 25.38 million), and dividend income (HKD 25 thousand), with hotel service revenue mainly from room rentals and ancillary services, and Hong Kong being the largest market contributor Revenue Source Analysis | Revenue Source | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Revenue from hotel operations | 231,238 | 224,959 | | Property rental income | 25,380 | 19,010 | | Dividend income | 25 | – | | Total revenue | 256,643 | 243,969 | Analysis of Revenue by Hotel Service Category | Type of goods or services | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Room rental income and other ancillary services | 223,334 | 218,166 | | Food and beverages | 7,904 | 6,793 | | Total | 231,238 | 224,959 | | Geographical distribution of markets | | | | Hong Kong | 218,879 | 214,436 | | People's Republic of China | 12,359 | 10,523 | | Total | 231,238 | 224,959 | Segment Information The Group's operating and reportable segments include hotel services, property investment, and securities investment, with hotel services showing growth in both revenue and results, notably from Best Western Plus Hotel Hong Kong and Ramada Hong Kong Harbour View, and a significant increase in Wood Street Hotel's asset value - The Group's operating and reportable segments include hotel services (eight hotels), property investment, and securities investment[53][54] Segment Revenue and Results | Segment | Revenue for the six months ended June 30, 2025 (Thousand HKD) | Revenue for the six months ended June 30, 2024 (Thousand HKD) | Results for the six months ended June 30, 2025 (Thousand HKD) | Results for the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | :--- | :--- | | Hotel services | 231,238 | 224,959 | 8,631 | 712 | | Property investment | 25,380 | 19,010 | 20,380 | 14,010 | | Securities investment | 25 | – | 25 | – | | Total | 256,643 | 243,969 | 29,036 | 14,722 | Segment Assets | Segment | As at June 30, 2025 (Thousand HKD) | As at December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Hotel services | 3,579,714 | 3,604,343 | | －Wood Street Hotel | 447,475 | 404,384 | | Property investment | 1,117,145 | 1,030,990 | | Securities investment | 79,912 | 92,204 | | Total segment assets | 4,776,771 | 4,727,537 | Segment Liabilities | Segment | As at June 30, 2025 (Thousand HKD) | As at December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Hotel services | 30,118 | 40,495 | | Property investment | 15,914 | 14,378 | | Securities investment | 1 | 1 | | Total segment liabilities | 46,033 | 54,874 | Finance Costs Total finance costs for the period amounted to HKD 17.177 million, a 26% decrease from the prior period, primarily due to lower interest expenses on bank loans and amounts due to the immediate holding company Composition of Finance Costs | Source of Interest | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Bank loans | 8,195 | 10,764 | | Amounts due to immediate holding company | 8,982 | 12,464 | | Total | 17,177 | 23,228 | Income Tax Expense Income tax expense for the period was HKD 6.654 million, a 117% increase year-on-year, mainly from current tax in Hong Kong and the UK, with the Group not expecting to pay top-up tax under Pillar Two rules Composition of Income Tax Expense | Source of Tax | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Current tax: Hong Kong | 3,933 | 2,260 | | Current tax: United Kingdom | 4,231 | 2,459 | | Underprovision in prior years: Hong Kong | 111 | – | | Deferred tax | (1,621) | (1,656) | | Total | 6,654 | 3,063 | - Hong Kong profits tax rate is 16.5%[63] - The Group expects its consolidated annual revenue to be less than EUR 750 million, thus not requiring payment of top-up tax under Pillar Two rules[64] Loss for the Period The loss for the period was HKD 15.385 million, after deducting HKD 69.109 million in depreciation of property, plant, and equipment and including HKD 1.23 million in bank deposit interest income Key Adjustments to Loss for the Period | Item | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Depreciation of right-of-use assets | 384 | 381 | | Depreciation of property, plant and equipment | 69,109 | 68,541 | | Interest income from bank deposits | (1,230) | (2,718) | | Loss on disposal of property, plant and equipment | 12 | 741 | Dividends For the six months ended June 30, 2025, the board of directors resolved not to declare or recommend any interim dividend - No dividends were declared or paid to shareholders for the six months ended June 30, 2025, and 2024[67] - The board of directors resolved not to declare or recommend any interim dividend for the six months ended June 30, 2025, and 2024[67] Loss Per Share For the six months ended June 30, 2025, basic loss per share narrowed to 0.17 HK cents from 0.36 HK cents in the prior period, with no diluted loss per share presented due to the absence of potential ordinary shares Basic Loss Per Share | Metric | For the six months ended June 30, 2025 (HK cents) | For the six months ended June 30, 2024 (HK cents) | | :--- | :--- | :--- | | Basic loss per share | (0.17) | (0.36) | - Basic loss per share is calculated based on the loss for the period attributable to owners of the Company of HKD 15.198 million and 8.947 billion ordinary shares in issue during the period[68] - No diluted loss per share is presented as there were no potential ordinary shares in issue during the period or prior period[68] Property, Plant and Equipment and Investment Properties During the period, HKD 3.017 million was spent on property, plant, and equipment acquisitions, with a HKD 12 thousand loss on disposal, while investment properties experienced a HKD 5 million fair value decrease, with a total carrying amount of approximately HKD 1.09 billion, valued by independent professional valuers using the income approach Changes in Property, Plant and Equipment and Investment Properties | Item | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Additions to property, plant and equipment | 3,017 | 10,496 | | Loss on disposal of property, plant and equipment | 12 | 741 | | Fair value decrease on investment properties | 5,000 | 5,000 | - Investment properties are stated at fair value, assessed by independent professional valuers using the income approach, with a total carrying amount of approximately HKD 1.09 billion[69] - The valuation methodology considers current market rental levels for existing leases and future reversionary income, capitalizing the rental income[70] Trade and Other Receivables As of June 30, 2025, total trade and other receivables amounted to HKD 9.072 million, a decrease from year-end, with trade receivables primarily comprising amounts not yet due, and a typical credit period of 30 to 60 days Trade and Other Receivables | Item | As at June 30, 2025 (Thousand HKD) | As at December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Trade receivables (customer contracts) | 5,951 | 8,361 | | Other receivables | 3,121 | 2,776 | | Total | 9,072 | 11,137 | Ageing Analysis of Trade Receivables | Ageing | As at June 30, 2025 (Thousand HKD) | As at December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Not yet due | 5,728 | 8,162 | | 0-30 days | 49 | 104 | | 31-60 days | 174 | 94 | | 61-90 days | – | 1 | - The Group grants credit terms of 30 to 60 days to travel agents and certain customers of its hotels[71] Trade and Other Payables and Accruals As of June 30, 2025, total trade and other payables and accruals amounted to HKD 39.685 million, a decrease from year-end, with accrued staff costs and rental deposits being major components Trade and Other Payables and Accruals | Item | As at June 30, 2025 (Thousand HKD) | As at December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Trade payables | 4,324 | 5,031 | | Interest payable | 202 | 278 | | Other payables | 3,006 | 1,129 | | Legal and professional fees payable | 1,461 | 2,349 | | Rental deposits received | 12,008 | 10,638 | | Accrued staff costs | 6,219 | 16,031 | | Other accruals | 12,465 | 11,960 | | Total | 39,685 | 47,416 | Ageing Analysis of Trade Payables | Ageing | As at June 30, 2025 (Thousand HKD) | As at December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | 0-30 days | 4,317 | 5,024 | | 31-60 days | 6 | 6 | | 61-90 days | 1 | 1 | Bank Loans As of June 30, 2025, the Group's total secured bank loans amounted to HKD 301.3 million, a decrease from year-end, with all loans bearing floating interest rates at an effective annual rate of 5.19% Bank Loan Status | Item | As at June 30, 2025 (Thousand HKD) | As at December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Secured bank loans | 301,298 | 345,152 | | Repayable within one year | 251,298 | 227,152 | | Bank loans containing a repayment on demand clause | 50,000 | 118,000 | - All of the Group's bank loans are floating rate loans, with an effective annual interest rate of 5.19% (December 31, 2024: 6.25%)[73] Share Capital As of June 30, 2025, the Company's issued and fully paid ordinary share capital remained consistent with year-end, totaling 8.947 billion shares with a nominal value of HKD 841.9 million Ordinary Share Capital | Item | Number of Shares (Thousand shares) | Nominal Value (Thousand HKD) | | :--- | :--- | :--- | | Issued and fully paid ordinary shares (as at June 30, 2025) | 8,947,051 | 841,926 | Related Party Transactions and Balances The Group engaged in various related party transactions, including short-term lease and interest expenses paid to its immediate holding company, and corporate management fee income received, with outstanding balances of HKD 329.5 million owed to the immediate holding company and HKD 5.088 million owed to Mr. Cheng Kai Man at period-end Related Party Transactions During the Period | Transacting Party | Type of Transaction | For the six months ended June 30, 2025 (Thousand HKD) | For the six months ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | :--- | | Magnificent Hotel Investments Limited and its subsidiaries | Short-term lease expenses | 520 | 520 | | Magnificent Hotel Investments Limited and its subsidiaries | Interest expense | 8,982 | 12,464 | | Magnificent Hotel Investments Limited and its subsidiaries | Corporate management fee income for administrative facilities provided | 2,323 | 2,307 | | Magnificent Realty Investment Holdings Limited | Corporate management fee income for administrative facilities provided | 75 | 75 | | Mr. Cheng Kai Man | Rental income from Mr. Cheng Kai Man | 420 | 420 | | Key management personnel | Remuneration | 6,651 | 6,684 | Related Party Balances at Period-End | Item | As at June 30, 2025 (Thousand HKD) | As at December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Amounts due to immediate holding company | 329,541 | 347,390 | | Amounts due to Mr. Cheng Kai Man | 5,088 | 7,487 | - Amounts due to the immediate holding company are unsecured, bear interest at 5.20% per annum, and are repayable on demand[75] Pledges of Assets As of June 30, 2025, the Group's bank loan facilities were secured by investment properties, hotel properties, shares of certain subsidiaries, property rental income, and an insurance assignment for one investment property Carrying Value of Pledged Assets | Pledged Assets | As at June 30, 2025 (Thousand HKD) | As at December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Investment properties | Approx. 1,043,000 | 995,000 | | Hotel properties | Approx. 1,468,000 | 1,493,000 | | Net assets of certain subsidiaries pledged as security for shares | Approx. 713,000 | 629,000 | - Other pledges include assignments of property rental income from certain subsidiaries and an insurance assignment for one investment property[75] Fair Value Measurement of Financial Instruments The Group's financial assets, such as equity investments at fair value through other comprehensive income, are measured at fair value and classified as Level 1, determined by quoted prices in active markets, while the carrying amounts of other financial assets and liabilities approximate their fair values Financial Assets Measured at Fair Value | Financial Assets | Fair Value as at June 30, 2025 (Thousand HKD) | Fair Value as at December 31, 2024 (Thousand HKD) | Fair Value Hierarchy | | :--- | :--- | :--- | :--- | | Equity investments at fair value through other comprehensive income | 79,912 | 92,204 | Level 1 | - Level 1 fair value measurements are derived from unadjusted quoted prices in active markets for identical assets or liabilities[78] - The directors of the Company consider that the carrying amounts of other financial assets and financial liabilities recorded at amortised cost approximate their fair values[77]