SUN HUNG KAI CO(HK:00086)2023-03-16 12:58Financial Performance - The company reported a loss attributable to shareholders of HKD 1,534.8 million for 2022, compared to a profit of HKD 2,813.7 million in the previous year, resulting in a basic loss per share of HKD 0.782[3]. - The group reported a total revenue of HKD 4,153.6 million for the year ended December 31, 2022, a decrease of 6.4% compared to HKD 4,435.8 million in 2021[11]. - Total revenue for the year ended December 31, 2022, was HKD 4,162.7 million, a decrease from HKD 4,271.3 million in 2021, representing a decline of approximately 2.5%[19]. - The net loss attributable to shareholders for the year was HKD 1,534.8 million, compared to a profit of HKD 2,813.7 million in the previous year, reflecting a significant decline[11]. - Basic loss per share was HKD 78.2 cents, down from earnings of HKD 142.7 cents per share in 2021[11]. - Total comprehensive loss for the year amounted to HKD 1,948.3 million, compared to a comprehensive income of HKD 3,590.3 million in 2021[12]. - The company reported a pre-tax loss of HKD 892.3 million for the year, compared to a profit in the previous year[19]. - The company recorded a pre-tax loss of HKD 892.3 million in 2022, down from a profit of HKD 3,773.2 million in 2021, largely due to losses in investment management[48]. Revenue and Business Segments - The segment revenue from consumer finance was HKD 3,499.3 million, accounting for the majority of total revenue[19]. - Revenue from investment management and fund management segments was HKD 122.1 million in 2022, down from HKD 190.6 million in 2021, indicating a decline of about 36.0%[25]. - The company’s revenue for 2022 was HKD 4,054.1 million, a decrease of 6.2% compared to HKD 4,324.0 million in 2021[45]. - The company achieved a pre-tax profit contribution of HKD 122.3 million from its mortgage loan business, marking a historical high since its inception in 2015[65]. - The mortgage loan business achieved a pre-tax profit of HKD 122.3 million in 2022, slightly up from HKD 120.0 million in 2021, marking a historical high for this segment[48]. Asset Management and Investments - The asset management scale increased from USD 809 million at the end of 2021 to USD 975 million at the end of 2022, driven by the performance of the ActusRayPartners European Alpha Fund[5]. - The investment management segment reported a loss before tax of HKD 2,403.8 million, primarily due to unrealized losses in alternative investments and real estate[5]. - The investment management division recorded an unrealized loss of HKD 1,865.9 million in 2022, partially offset by realized gains of HKD 400.8 million[75]. - The overall return rate for the investment management segment in 2022 was -8.3%, with public markets returning -6.1%[77]. - The alternative investment portfolio's year-end value was HKD 12,928.3 million, with an annual return rate of -9.8%, down from HKD 15,235.1 million in the previous year[87]. Dividends and Share Repurchase - The company announced a second interim dividend of HKD 0.14 per share, maintaining the same level as the previous year, with total dividends for 2022 amounting to HKD 0.26 per share[3]. - The total dividend declared for 2022 was HKD 512.1 million, down from HKD 592.7 million in 2021, representing a decrease of approximately 13.6%[31]. - The company plans to continue its share repurchase program, having repurchased 5.9 million shares at a total net cost of HKD 18.3 million in 2022[3]. - The company repurchased a total of 5,930,000 shares at a total cost of HKD 18,270,110 during the year ended December 31, 2022[132]. Financial Position and Liabilities - Non-current assets decreased to HKD 22,258.8 million as of December 31, 2022, from HKD 24,943.4 million in the previous year[13]. - The total liabilities decreased from HKD 12,199.8 million in 2021 to HKD 6,849.9 million in 2022, a reduction of approximately 43.5%[14]. - The company's equity attributable to shareholders decreased to HKD 22,358.1 million in 2022 from HKD 25,075.2 million in 2021, a decline of about 11.0%[14]. - The company's total borrowings reached HKD 15,650.0 million as of December 31, 2022, down 14.4% from HKD 18,283.0 million in 2021[112]. - The net debt decreased by 20.5% to HKD 9,766.1 million, compared to HKD 12,282.3 million in the previous year[111]. Market Outlook and Strategic Initiatives - The group expressed cautious optimism for 2023, citing improved financing business prospects due to the easing of COVID-19 measures in Hong Kong and mainland China[9]. - The company plans to continue focusing on market expansion and new product development in the upcoming fiscal year[20]. - The company plans to focus on credit-driven new business initiatives in the short term, anticipating a quicker market repricing due to significant uncertainties[93]. - The company anticipates growth in the consumer finance business in 2023, driven by an improving regional economic outlook[106]. Employee and Governance - The total number of employees decreased to 1,608 as of December 31, 2022, from 1,738 in 2021, reflecting ongoing cost-efficiency efforts[119]. - The company has adopted competitive employee benefits, including optimized medical and dental benefits, to attract and retain top talent[120]. - The company has maintained a strong focus on employee training and professional development through personal training and online learning platforms[120]. - The company’s board of directors includes both executive and independent non-executive members, ensuring a diverse governance structure[138]. Risk Factors and Challenges - The group acknowledged ongoing uncertainties related to global economic recession and geopolitical tensions, which continue to challenge the operating environment[9]. - The company faced significant financial market volatility and economic downturns in 2022, impacting its financial performance[45]. - The net impairment loss for financial instruments was HKD (702.3 million), representing 5.8% of the average loan balance, compared to HKD (509.4 million) or 4.2% in the previous year[57].