Group 1: Tourism Consumption - During the National Day and Mid-Autumn Festival holiday, Guangdong received over 65.17 million tourists, generating tourism revenue exceeding 61.3 billion yuan, both showing an increase of over 10% compared to last year [1] - Shenzhen welcomed approximately 9.2 million tourists, marking a 12.4% increase from the previous year, with total tourism revenue reaching 8.94 billion yuan, up 17.6% [2] - Over 1.4 million mainland tourists visited Hong Kong during the holiday, reflecting a growth of about 15% year-on-year [3] Group 2: New Attractions and Events - New landmarks in Shenzhen, such as the "Bay Area Eye" bookstore and the Qianhai Ice World, contributed to the tourism surge, with the bookstore attracting significant foot traffic shortly after its opening [2] - The Qianhai Ice World, the largest indoor ski resort globally, became a popular destination among younger tourists during the holiday [2] Group 3: Retail Performance - Hong Kong's hotel industry saw revenue growth of over 10% during the holiday, with an average occupancy rate exceeding 90% [3] - Retail sales in Hong Kong showed stable performance, with jewelry and cosmetics sales experiencing low double-digit growth, attributed to rising gold prices and new smartphone releases [4] - The K11 MUSEA shopping mall reported a 12% increase in foot traffic compared to last year, achieving a record high since its opening [4]

Group 1 - The core viewpoint indicates that New World Development's fiscal year 2025 performance aligns with expectations, with a revenue of HKD 27.68 billion, a 23% decrease from HKD 35.78 billion in 2024, primarily due to the nearing completion of construction projects, reduced income from property development in mainland China, and loss of revenue from sold businesses [1] - Gross profit for fiscal year 2025 was HKD 11.63 billion, down 10% year-on-year, while core operating profit from continuing operations was HKD 6.02 billion, a 13% decline, with an estimated core profit of approximately HKD 0.5 billion, slightly below expectations [1] - The board has decided not to declare a final dividend for the fiscal year [1] Group 2 - The sales target for fiscal year 2026 has been raised to HKD 27 billion, benefiting from the easing of property market restrictions and anticipated interest rate cuts, with expected contract sales of approximately HKD 11 billion in Hong Kong, mainly from luxury projects and office developments [2] - In mainland China, the company achieved contract sales of RMB 14 billion, with 52% coming from the Greater Bay Area, and the investment properties performed well, with increased foot traffic and sales at K11 MUSEA and K11 ArtMall [2] Group 3 - The company continues to prioritize debt reduction, with total debt decreasing from approximately HKD 151.6 billion at the end of fiscal year 2024 to about HKD 146 billion, and net debt reduced by approximately HKD 4.5 billion [3] - Short-term debt significantly decreased to around HKD 6.6 billion, and the company successfully completed HKD 88.2 billion in loan refinancing in June 2025, enhancing financial flexibility [3] - For fiscal year 2026, the company has proposed seven debt reduction measures, including accelerating sales, unlocking agricultural land value, expediting the sale of non-core assets, reducing capital expenditures, and suspending dividends to improve cash flow and reduce debt [3] - The company maintains a buy rating and has raised the target price to HKD 9.70, believing that the current price-to-book ratio of approximately 0.13 reflects market concerns about its debt, with expectations of further interest rate declines and a gradual recovery in the Hong Kong property market [3]

Core Insights - New World Development reported a significant loss of 16.302 billion HKD from continuing operations for the fiscal year 2025, primarily due to impairment provisions related to development properties totaling approximately 8.5 billion HKD and a valuation revision loss of 2.7 billion HKD from the 11SKIES project [2][3] - The company secured a financing agreement with Deutsche Bank AG for up to 5.9 billion HKD, with an initial commitment of 3.95 billion HKD, using the Victoria Dockside property as collateral [2][3] - The company has made progress in reducing its debt, with total debt decreasing from 146.5 billion HKD at the end of 2024 to 146 billion HKD by June 2025, and net debt reduced from 124.6 billion HKD to 120.1 billion HKD [4][5] Financial Performance - For the fiscal year 2025, New World Development recorded total revenue of 27.681 billion HKD and a gross profit of 11.626 billion HKD, with core operating profit at 6.016 billion HKD [2] - The company achieved a contract sales target of 26 billion HKD, with 11 billion HKD from Hong Kong and 14 billion RMB from mainland China [6][8] - Investment property income for the fiscal year was 50.55 billion HKD, with a stable performance in both Hong Kong and mainland properties [21][23] Debt Reduction Strategy - The company is actively implementing a "Seven Measures to Reduce Debt Plan," which includes selling development projects and non-core assets, releasing agricultural land value, and improving rental returns [5][13] - The company has successfully reduced short-term debt significantly, with debts due within two years decreasing from 73.8 billion HKD to 29 billion HKD, and debts due within one year dropping from 41.6 billion HKD to 6.6 billion HKD [4][5] Property Development and Sales - New World Development plans to launch several key projects in Hong Kong for the fiscal year 2026, including the "Bauhinia" project in Kowloon City and multiple luxury residential projects [7][9] - In mainland China, the company has a rich pipeline of projects, including Guangzhou and Shenzhen developments, with plans to continue selling these properties [8][9] Rental Income and Property Performance - The company reported a rental income of 3.234 billion HKD from its Hong Kong investment properties, contributing 40% to the group's core profit, driven by high occupancy rates at K11 MUSEA and office buildings [15][21] - K11 MUSEA has seen a surge in international luxury brands, enhancing its rental yield and overall revenue [15][16] - The K11 Art Mall in Hong Kong achieved a 100% occupancy rate, with significant sales growth in the anime and outdoor sports segments [19][20]

Group 1 - The company reported a revenue of HKD 27.681 billion from continuing operations for the fiscal year ending June 30, 2025, with a gross profit of HKD 11.626 billion and a core operating profit of HKD 6.016 billion, indicating strong performance and profitability in its core business [1] - In the core real estate segment, the company achieved contract sales of HKD 26 billion, with contributions of HKD 11 billion from Hong Kong and RMB 14 billion from mainland China, where the southern region, led by the Greater Bay Area, accounted for nearly 52% of sales [1] - The company raised its sales target for fiscal year 2026 to HKD 27 billion, reflecting optimism about market prospects and confidence in its sales capabilities [1] Group 2 - The company reported property development revenue of HKD 2.696 billion from Hong Kong and HKD 12.344 billion from mainland China, with segment profits of HKD 0.877 billion and HKD 4.703 billion, respectively [1] - In the investment property sector, rental rates and sales for office buildings and shopping malls in both Hong Kong and mainland China showed steady growth, with recurring income continuing to rise [1] - The company generated HKD 3.234 billion in investment property revenue from Hong Kong and HKD 1.821 billion from mainland China, with segment profits of HKD 2.401 billion and HKD 0.843 billion, respectively [1] Group 3 - The CEO expressed confidence in the company's ability to capitalize on market improvements, driven by declining interest rates and a recovering real estate market, and emphasized the commitment to accelerate sales and cash flow [2]

Core Viewpoint - New World Development has reported a solid performance for the fiscal year 2025, achieving a core operating profit of HKD 6 billion and setting a sales target of HKD 27 billion for fiscal year 2026, indicating a positive outlook for the company's financial health and operational efficiency [1] Financial Performance - The company successfully completed bank refinancing of HKD 88.2 billion, extending the maturity of bank loans to June 30, 2028, which significantly enhances liquidity [2] - Average interest rates and total financing costs have decreased due to interest rate cuts in the US and Hong Kong, alongside a reduction in debt levels [2] - Capital expenditures (CAPEX) decreased by 15% year-on-year, while operating expenditures (OPEX) fell by 16%, reflecting improved operational efficiency [2] Real Estate Business - The core real estate business performed strongly, achieving contract sales of HKD 26 billion, with contributions of HKD 11 billion from Hong Kong and RMB 14 billion from mainland China [3] - Notable projects include the "滶晨" project in Hong Kong, which achieved sales of over HKD 10.7 billion, and the "广粤观邸" project in Guangzhou, which sold RMB 2 billion on opening day [3] Future Development Plans - The company has a robust land bank and plans to launch over 2,100 units in Hong Kong for fiscal year 2026, including projects in Kowloon City and West Kowloon [4] - Collaborative projects with partners such as China Merchants Shekou and China Resources Land are underway, aiming to provide thousands of residential units [4] - The investment property segment is also set for expansion, with new K11 projects opening in Guangzhou and Shanghai, contributing to future revenue growth [4]

Core Viewpoint - UBS report indicates that the mid-year performance of Wharf Real Estate Investment Company met expectations, with basic earnings remaining flat year-on-year at HKD 3.1 billion, which is 4% lower than the bank's forecast [1] Financial Performance - Basic earnings for the first half of the year were HKD 3.1 billion, unchanged from the previous year [1] - Interim dividend per share is HKD 0.66, representing a 3% year-on-year increase, in line with expectations [1] Management Outlook - Management maintains a cautious stance on retail rental income, anticipating a potential negative shift in rental returns [1] - Expected rental adjustments for Harbour City are projected to show a low single-digit decline, a reversal from positive adjustments seen in the first half of the year [1] Future Plans - Management revealed plans for significant asset enhancement or complete reconstruction of the Marco Polo Hotel, with construction expected to start after 2025 [1] - If it is an asset enhancement initiative (AEI), the required capital expenditure is approximately HKD 2 billion, with a disruption period of only two years, expected to have limited financial impact [1] - In the case of a complete reconstruction, concerns arise regarding the impact on luxury tenants on Canton Road due to increased competition from high-end malls like K11 MUSEA in Tsim Sha Tsui [1] Rating and Target Price - UBS maintains a "Neutral" rating on Wharf Real Estate Investment Company with a target price of HKD 20 [1]

Market Overview - In July, Hong Kong's new property market remained active with over 2,000 transactions, representing a month-on-month increase of over 30% [2] - New World Development reported strong business momentum at the beginning of the new fiscal year, with excellent sales results from various projects in mainland China and Hong Kong, leading to steady cash flow [2] Mainland Business - The high-end residential project Tianhui Xi in Shanghai successfully delivered all 448 units, selling out after two rounds of sales [5] - In Guangzhou, the new landmark project Yaosheng New World Plaza is delivering residential, commercial, and Grade A office spaces, showcasing New World's strong delivery capabilities [5] - The K11 ECOAST in Shenzhen launched multiple summer activities and added nearly 20 new brands, enhancing tenant diversity and customer experience [5] Awards and Recognition - Shanghai K11 ELYSEA and Ningbo THEPARK by K11Select won multiple awards at the BETTER FUTURE Hong Kong Design Awards 2025 for their architectural excellence [6] - New World Development's sustainability efforts were recognized with awards for the Hangzhou New World City Art Center and the "2030+ Sustainable Development Vision" [6] Hong Kong Business - The luxury residential project DEEP WATER PAVILIA滶晨II in Hong Kong sold 82 out of 88 units in its first round, achieving a sales rate of 93% [8] - The new landmark luxury residential project 柏蔚森 in Kai Tak has sold over 600 units since its launch, generating over HKD 4.2 billion in sales [9] - The core cultural landmark luxury project STATE PAVILIA皇都 sold out all units in the "皇都维港珍藏大宅" series, with an average price of nearly HKD 40 million [9] Events and Promotions - New World Development hosted two major international events at K11 MUSEA during the summer, including the "CHIIKAWA DAYS" exhibition and the CR7® LIFE Museum, attracting significant visitor traffic [10]

Group 1 - New World Development Company Limited has reached a new bank financing and unified bank financing agreement covering approximately HKD 88.2 billion of existing unsecured financial debt [1] - The company's financial management strategy focuses on reducing liabilities and improving cash flow, while continuing to fulfill existing financial responsibilities [1] - The recovery of the real estate market in Hong Kong and mainland China, along with the growth in demand for high-end residential properties, has led to the successful launch of several "phenomenal" hot-selling projects [1] Group 2 - As of June 25, the company has achieved its contract sales target of HKD 26 billion for the fiscal year 2024/2025 [1] - In the mainland market, projects in Guangzhou and Shenyang have led sales, with Shenyang's project topping the residential sales chart in May [1] - In Hong Kong, the super luxury project "滶晨" has sold over 330 units at a maximum price of over HKD 538,000 per square meter, attracting both local and overseas buyers [2]