2025-09-23 08:56Financial Performance - Total revenue for the first half of 2025 was HKD 5.202 billion, a decrease of 18% compared to HKD 6.379 billion in 2024[18]. - Property leasing income decreased by 3% to HKD 4.912 billion, while operating profit from property leasing fell by 4% to HKD 3.499 billion[19]. - Hotel revenue increased by 84% to HKD 1.29 billion, compared to HKD 0.7 billion in 2024[19]. - Total revenue for the six months ended June 30, 2025, decreased by 18% to HKD 5,202 million compared to HKD 6,379 million in 2024[20]. - Property sales plummeted by 87% to HKD 161 million, with Hong Kong sales dropping significantly from HKD 1,203 million to HKD 151 million[20]. - Operating profit decreased by 6% to HKD 3,408 million from HKD 3,613 million in the previous year[20]. - The company recorded a net loss attributable to shareholders of HKD 0.494 billion due to property revaluation losses[14]. - Basic earnings per share decreased by 7% to HKD 0.87, down from HKD 0.94 in 2024[15]. - Net profit for the period was HKD 1,308 million, a decline of 14.3% compared to HKD 1,526 million in 2024[108]. - Basic earnings per share for 2025 was HKD 0.51, down from HKD 0.65 in 2024, representing a decrease of 21.5%[106]. Rental and Occupancy Trends - The rental occupancy rate remained stable at over 90% in mainland China despite a decline in consumer confidence[17]. - The overall rental rate for the property portfolio remained stable at 94%, with a slight increase of 1%[23]. - The flagship Shanghai Hang Lung Plaza maintained a high occupancy rate of 98%, with rental income remaining stable despite an 8% drop in tenant sales[28]. - Shanghai Hong Kong Plaza reported a 1% increase in revenue and a 10% increase in tenant sales, with a high occupancy rate of 99%[29]. - Wuxi Hang Lung Plaza experienced an 8% increase in revenue despite a 4% decline in tenant sales, maintaining a 96% occupancy rate[29]. - Kunming Hang Lung Plaza recorded a 7% revenue growth, while tenant sales slightly decreased by 1%, with occupancy rising to 99%[30]. - Dalian Hang Lung Plaza achieved a 10% increase in revenue and a 13% increase in tenant sales, with a 94% occupancy rate[30]. - Shenyang Royal Hang Lung Plaza saw a 4% increase in revenue and a 10% increase in tenant sales, with occupancy rising by 4 percentage points to 96%[31]. - Wuhan Hang Lung Plaza faced a significant decline, with revenue and tenant sales dropping by 36% and 31% respectively, but occupancy improved by 5 percentage points to 88%[32]. Strategic Initiatives - The company has introduced a new strategy called "Hang Lung V.3," focusing on strategic reinvestment in existing assets to enhance their scale and visibility[9]. - The company is strategically pursuing retail management contracts in certain markets to consolidate its existing position while investing additional capital in others[10]. - The company aims to maintain its leading position in every city where it operates, emphasizing the importance of physical retail in the current market[8]. - The company plans to expand Shanghai Hang Lung Plaza, increasing the leasable area by over 13%, with completion expected in 2026[11]. - A new partnership with Baida Group in Hangzhou is projected to increase leasable floor area by approximately 40% and street-facing area by over 200%[12]. - The company is developing multiple investment projects, including the second phase of Wuxi Hang Lung Plaza and a new co-working space project in Hong Kong[18]. Debt and Financial Management - The net debt-to-equity ratio increased to 31.5% from 30.8% in the previous year[16]. - Total borrowings as of June 30, 2025, were HKD 55,972 million, a decrease from HKD 57,794 million on December 31, 2024, with 42% denominated in RMB[56]. - The average repayment period of the debt portfolio was 3.1 years as of June 30, 2025, compared to 2.9 years on December 31, 2024, with approximately 72% of loans due after two years[59]. - Total financial expenses decreased by 6% to HKD 1,002 million in the first half of 2025, with an average effective borrowing rate reduced to 3.9% from 4.4% in 2024[62]. - The interest coverage ratio for the first six months of 2025 remained stable at 3.2 times, consistent with 2024[64]. Sustainability and Corporate Responsibility - 80% of the properties in the mainland portfolio are now powered by renewable energy, up from 50%, with a target of procuring approximately 320 million kWh of renewable energy by the end of the year[67]. - The company has released a discussion paper on achieving net-zero emissions by 2050, aiming to reduce greenhouse gas emissions from nearly 1 million tons in 2023 to below 100,000 tons[68]. - The "Changemakers Tenant Sustainability Cooperation Program" has attracted 42 tenants, covering over 238,000 square meters, which is 12% of the total leasable area of the group[69]. - The group has donated over RMB 33 million since 2010 to support Tsinghua University's real estate projects and academic research[71]. Governance and Shareholder Information - The board consists of three executive directors, three non-executive directors, and five independent non-executive directors, with independent directors making up approximately 46%[76]. - The company has complied with the Corporate Governance Code as per Appendix C1 of the Listing Rules, exceeding certain requirements in some areas during the six months ending June 30, 2025[79]. - As of June 30, 2025, the company’s major shareholder, Chen Wenbo, holds 551,752,580 shares, representing 40.52% of the issued shares[81]. - The total number of options available for grant under the 2022 Share Option Scheme is 276,275,550 shares, which accounts for approximately 5.5% of the total issued shares of the company[85]. - The company has not made any arrangements for directors to benefit from purchasing shares or debt securities of the company or any other entity during the six months ending June 30, 2025[82]. Market Outlook - The company is actively adjusting its business operations in response to government initiatives aimed at stimulating consumption and tourism[22]. - The group anticipates a moderate improvement in domestic demand due to fiscal expansion and targeted government support measures in the coming months[73]. - The residential market in Hong Kong is showing signs of bottoming out, with confidence in better sales performance as the economy recovers[74].