SWIRE PACIFIC A(HK:00019)2024-04-08 09:02Company Overview - Swire Properties operates over 2,200 retail outlets in its shopping malls, with an estimated workforce of over 70,000 in its office buildings in Hong Kong[6]. - Swire Group employs over 78,000 people globally, with more than 32,000 in Hong Kong and over 35,000 in mainland China[6]. - The company is focusing on long-term growth in the real estate, beverage, and aviation sectors, with plans to expand into healthcare services in major urban areas in mainland China and Southeast Asia[4][6]. - Swire Group has established a strong presence in the Greater China region, leveraging its extensive experience and solid business relationships[4]. Financial Performance - The company reported a significant increase in net profit attributable to shareholders, reaching HKD 28,853 million in 2023, up 588% from HKD 4,195 million in 2022[7]. - Basic earnings per share for 'A' shares surged by 687% to HKD 25.03, while 'B' shares increased by 693% to HKD 5.01[7]. - Revenue for 2023 was HKD 94,823 million, reflecting a 3% growth from HKD 91,693 million in 2022[7]. - Operating profit increased by 150% to HKD 30,621 million, with a significant rise in operating profit excluding fair value changes of investment properties, which reached HKD 33,481 million, up 193%[7]. - The company achieved a cash inflow from operations of HKD 14,479 million, a 20% increase from HKD 12,043 million in 2022[7]. - The total equity, including non-controlling interests, rose by 3% to HKD 324,774 million[7]. Dividends and Shareholder Value - The company aims to maintain a stable dividend growth while creating long-term shareholder value through strategic investments in high-potential sectors[4]. - The company declared a dividend of HKD 11.32 per 'A' share, representing a 277% increase compared to HKD 3.00 in 2022[7]. - The group announced a progressive dividend policy, declaring an interim dividend of HKD 2.00 per 'A' share and HKD 0.40 per 'B' share, resulting in an overall dividend of HKD 3.20 per 'A' share and HKD 0.64 per 'B' share for the year, a 7% increase from 2022[12]. Investment Strategy - Swire Group's investment strategy focuses on building a portfolio that can consistently provide stable dividends[4]. - The company plans to invest nearly 60% of its HKD 100 billion commitment in core market projects by March 2024[10]. - The company is actively seeking investment opportunities in the private healthcare sector, particularly in major urban areas in mainland China and Southeast Asia[6]. - The group plans to invest in residential property markets in Bangkok, Jakarta, and Ho Chi Minh City despite a challenging business environment[13]. Real Estate and Property Development - The total floor area attributable to Swire Properties is approximately 34.4 million square feet, with 24.4 million square feet completed and 10 million square feet under development[31]. - The total completed area in mainland China is 10.6 million square feet, with significant projects in cities like Beijing, Guangzhou, and Shanghai[35]. - The company has nine residential projects under development, with four in Hong Kong and two in mainland China[33]. - The company aims to enhance shareholder value through active asset management and development of high-quality residential properties[34]. Aviation Sector Performance - Cathay Pacific and its subsidiaries operated a fleet of 230 aircraft as of December 31, 2023, providing scheduled passenger and cargo services to 92 destinations globally[6]. - Cathay Group reported a significant increase in passenger traffic, carrying 18 million passengers in 2023, more than five times the number in 2022[11]. - Cathay Pacific's passenger revenue reached HKD 55,951 million in 2023, a 308.8% increase from HKD 13,686 million in 2022[167]. - The passenger load factor improved to 85.7% in 2023, up by 12.1 percentage points from 73.6% in 2022[167]. Beverage Division Performance - The beverage division distributes Coca-Cola products to a population of 847 million in Greater China and Southeast Asia, and provides management support services to Swire Coca-Cola in the U.S., which serves a population of 31 million[6]. - Total revenue for 2023 was HKD 51,844 million, a decrease of 5% from HKD 54,225 million in 2022[134]. - Swire Coca-Cola recorded a profit attributable to shareholders of HKD 25.097 billion, including a non-recurring gain of HKD 22.907 billion from the sale of its US subsidiary[137]. Sustainability and Development Goals - The company is committed to sustainable development and believes it is essential for long-term growth and innovation[4]. - The group has committed to sustainability, with internal carbon pricing initiatives and a goal to achieve net-zero carbon emissions by 2050[13]. - Swire Coca-Cola aims to integrate sustainability goals into its business plan, empowering employees to contribute to achieving these objectives by 2030[130]. Challenges and Future Outlook - The company expects moderate growth in 2024 due to the return of tourists to Hong Kong, although this growth may be partially offset by local residents traveling to mainland China[192]. - The Hong Kong office market is expected to remain weak in 2024 due to soft demand and increased supply, with rental prices under downward pressure, particularly from Central and Kowloon East[121]. - Future outlook indicates challenges in mainland China due to weak consumer spending, while moderate growth is expected in Hong Kong[152].