Financial Data and Key Metrics Changes - Investment properties revenue decreased by 3% and operating profit fell by 4% due to persistent weak market conditions [2] - Gearing ratio improved to a new low of 17.6%, reflecting the company's commitment to deleveraging [2][6] - Core underlying net profit remained stable, with a 3% increase attributed to lower borrowing costs, which decreased by 27% [2][6] - Interim dividend per share increased by 3% to HKD 0.66 [3][6] Business Line Data and Key Metrics Changes - Hong Kong investment properties and hotels saw a 3% increase in core underlying net profit [3] - Retail rental income softened due to a drop in turnover rent, while office rental income rose by 2% driven by higher occupancy [5][12] - Harbour City maintained its revenue position relative to peers, benefiting from its scale and location [4] Market Data and Key Metrics Changes - Inbound visitation to Hong Kong increased from 9% to 15%, and retail sales ended a fourteen-month decline with positive growth in May and June [5] - Retail occupancy at Harbour City was 93%, while office occupancy rose to 90% [11][12] - Overall retail sales in Hong Kong have retreated to 2011 levels, with Harbour City retail revenue at 2014 levels [3][4] Company Strategy and Development Direction - The company is focused on deleveraging and maintaining solid cash flow despite falling asset values [6] - Plans to enhance experiential retail to drive engagement and sales, including partnerships with premium brands [9][10] - The company is considering significant capital investments to enhance competitiveness, particularly for the Marco Polo Hong Kong Hotel [24][25] Management's Comments on Operating Environment and Future Outlook - Management noted that the retail market in Hong Kong is in a base-building phase, with cautious optimism for gradual recovery [3][21] - Geopolitical tensions and uncertainties around interest rates continue to impact the market [3][14] - The company remains agile and proactive in navigating ongoing headwinds, with a focus on sustainability and ESG initiatives [15][16] Other Important Information - The company achieved LEED Platinum certification for several properties, reinforcing its commitment to sustainability [10][16] - Total equity has declined by 11% since IPO, primarily due to investment property revaluation [7] Q&A Session Summary Question: Retail sales performance and footfall outlook - Management observed a small year-on-year improvement in retail sales in May and June but cautioned that it is premature to conclude a recovery [21][22] Question: Capital investment plans for hotels - Management is evaluating whether to redevelop the Marco Polo Hong Kong Hotel or undertake a complete overhaul, with significant investment required [24][25] Question: Occupancy cost sustainability and rental pressures - Occupancy cost at Harbour City is stable at about 20%, but management does not expect base rent to increase significantly in the near term [29] Question: Office rental income increase explanation - The increase in office rental income is attributed to improved occupancy rather than rising rent per square foot [32][34] Question: Competitive landscape in retail - Management acknowledged increased competition in the retail sector, particularly in Cosway Bay, and emphasized the need for strategic investments [38][39] Question: Future acquisition plans - The company is not in a hurry to undertake acquisitions and will only consider attractive opportunities that align with its deleveraging strategy [53] Question: Redevelopment potential of Ocean Center - Management confirmed plans to redevelop Ocean Center but prioritized the Marco Polo Hong Kong Hotel due to its current state [75]

Financial Data and Key Metrics Changes - Investment properties revenue decreased by 3% and operating profit fell by 4% due to weak market conditions [3][4] - Borrowing costs decreased by 27% thanks to a drop in HIBOR, leading to a stable underlying net profit [3][4] - Gearing ratio reached a new low of 17.6%, reflecting the company's commitment to deleveraging [3][7] - Interim dividend per share increased by 3% to HKD 0.66, maintaining a consistent dividend policy since IPO [4][7] Business Line Data and Key Metrics Changes - Core underlying net profit from Hong Kong investment properties and hotels increased by 3% [4][7] - Retail rental income softened due to a drop in turnover rent, while office rental rose by 2% driven by higher occupancy [5][6] - Harbour City maintained its revenue position relative to peers, benefiting from its scale and location [5][6] Market Data and Key Metrics Changes - Retail sales in Hong Kong showed quarter-on-quarter improvement, ending a fourteen-month decline with positive growth in May and June [5][6] - Inbound visitation growth rose from 9% to 15%, indicating a recovery in tourism [5][6] - Retail occupancy at Harbour City was 93%, while office occupancy rose to 90% [12][13] Company Strategy and Development Direction - The company is focused on deleveraging and maintaining solid cash flow amidst a challenging macro environment [3][4] - Plans to enhance experiential retail to drive engagement and sales, including partnerships with premium brands [9][10] - The company is considering significant capital investment for the Marco Polo Hong Kong Hotel to enhance competitiveness [24][25] Management Comments on Operating Environment and Future Outlook - Management noted that the retail market in Hong Kong is in a base-building phase, with a cautious outlook for the second half of the year [4][24] - Geopolitical tensions and uncertainties around interest rates continue to impact the market [4][15] - The company remains agile and proactive in navigating ongoing headwinds while focusing on sustainability initiatives [16][17] Other Important Information - The company achieved LEED Platinum certification for both Times Square and Harbour City offices, reinforcing its commitment to sustainability [11][17] - The company aims to cut Scope 1 and 2 emissions by 42% and Scope 3 emissions by 25% by 2030 [16][17] Q&A Session Summary Question: Retail sales performance and sentiment outlook - Management noted a small improvement in retail sales in May and June but cautioned that it is premature to conclude a recovery [22][23] Question: Capital investment plans for hotels - Management is evaluating whether to redevelop the Marco Polo Hong Kong Hotel or undertake a complete overhaul, with no immediate plans to start work [24][25] Question: Occupancy cost and rental expectations - Occupancy cost at Harbour City is stable at about 20%, and management does not expect base rent to increase significantly in the near term [31][32] Question: Office rental income increase - The increase in office rental income was due to higher occupancy rather than rising rent per square foot, with competition remaining a challenge [36][37] Question: Future plans for Times Square - Management indicated readiness to invest in tenant and shopper engagement at Times Square to remain competitive [75][76]