Hongkong Land Hldgs

Half-year Report

RNS Number : 4943U
Hongkong Land Hldgs Ltd
29 July 2020
 

29th July 2020

 

The following announcement was issued today to a Regulatory Information Service approved by the Financial Conduct Authority in the United Kingdom.

 

HONGKONG LAND HOLDINGS LIMITED 

HALF-YEARLY RESULTS FOR THE SIX MONTHS ENDED 30TH JUNE 2020

 

Highlights

· Underlying profit down 24% due to retail rent relief and fewer residential completions

· Resilient performance from the Group's office portfolios

· Net assets per share down 6% on lower capital values

· Strategic partnership conditionally agreed for the West Bund project in Shanghai

· Strong financial position with ample liquidity and an unchanged interim dividend

 

"While second half underlying profits are expected to benefit from higher Development Properties completions on the Chinese mainland than in the first half, uncertainty remains about the duration of the pandemic and the effect it will have on the Group's full year results."

 

Ben Keswick

Chairman

 

Results

 

 

 

 

(unaudited)  

 

 

Six months ended 30th June

 

 

2020

2019

Change

 

US$m

US$m

%

 

 

 

 

 

 

 

 

  Underlying profit attributable to shareholders#

353

466

-24

  (Loss)/profit attributable to shareholders

(1,828)

411

n/m

  Shareholders' funds

35,965

38, 247*

-6

  Net debt

5,628

3, 591*

+ 57

 

 

 

 

 

 

 

 

 

US¢

US¢

%

 

 

 

 

 

 

 

 

  Underlying earnings per share#

15.12

19.96

-24

  Earnings per share

(78.31)

17.61

n/m

  Interim dividend per share

6.00

6.00

-

 

 

 

 

 

 

 

 

 

US$

US$

%

 

 

 

 

 

 

 

 

  Net asset value per share

15.41

16. 39*

-6

 

 

 

 

 

 

 

 

# The Group uses 'underlying profit attributable to shareholders' in its internal financial reporting to distinguish between ongoing business performance and non-trading items, as more fully described in note 7 to the condensed financial statements.  Management considers this to be a key measure which provides additional information to enhance understanding of the Group's underlying business performance.

* At 31st December 201 9

 

 

         

The interim dividend of US¢6.00 per share will be payable on 14th October 2020 to shareholders on the register of members at the close of business on 21st August 2020.

 

 

HONGKONG LAND HOLDINGS LIMITED

HALF-YEARLY RESULTS FOR THE SIX MONTHS ENDED 30TH JUNE 2020

 

OVERVIEW

The Group's underlying profit in the period reflected a lower contribution from Investment Properties due to the granting of pandemic-related retail rent relief, and a lower contribution from Development Properties as a result of fewer residential completions taking place than in the corresponding period last year. Higher profits are expected from Development Properties in the second half of the year due to a greater number of completions on the Chinese mainland, although some completions originally scheduled for 2020 will be delayed until 2021 as a result of construction delays caused by the pandemic. 

 

PERFORMANCE

Underlying profit attributable to shareholders during the first half of the year was US$353 million, compared with US$466 million in the equivalent period in 2019. 

 

Including net non-cash losses of US$2,180 million arising on the bi-annual revaluation of the Group's investment properties due to lower open market rents, there was a loss attributable to shareholders for the first half of the year of US$1,828 million.  This compares with a profit of US$411 million for the first half of 2019, which included net losses of US$55 million primarily arising from investment property revaluations. 

 

The net asset value per share at 30th June 2020 was US$15.41, compared to US$16.39 at 31st December 2019.

 

The Directors have declared an unchanged interim dividend of US¢6.00 per share.

 

GROUP REVIEW

Investment Properties

The contribution from the Group's office portfolio in Hong Kong remained resilient, despite subdued leasing activity. Vacancy was 5.0% at the end of June 2020, compared to 2.9% at the end of 2019, and on a committed basis it was 4.5%, compared to 2.9% at the end of 2019.  Office rental reversions were mildly positive, with average office rents of HK$121 per sq. ft in the first half of 2020. This compares to HK$116 per sq. ft and HK$119 per sq. ft in the first and second halves of 2019, respectively.

 

The Group's Central retail portfolio was negatively impacted in the first half by weak consumer sentiment and the various anti-pandemic measures introduced by the Hong Kong government.  Vacancy of 0.4% on both a physical and committed basis is virtually unchanged compared to 0.3% at the end of 2019. Base retail rental reversions were mildly positive in the period, although temporary rent relief and decreased turnover rent resulted in average retail rents declining to HK$151 per sq. ft in the first half of 2020, compared with HK$239 per sq. ft and HK$205 per sq. ft in the first and second halves of 2019, respectively.  Excluding temporary rent relief, average retail rents in the first half of 2020 were HK$230 per sq. ft.

 

In Singapore, vacancy across the Group's office portfolio was 1.5% at the end of June 2020, compared with 5.0% at the end of 2019.  On a committed basis, vacancy was 1.0%, compared to 0.7% at the end of 2019.  Average office rents increased to S$9.9 per sq. ft in the first half of 2020, compared with S$9.6 per sq. ft and S$9.7 per sq. ft in the first and second halves of 2019, respectively. Rental reversions remained positive in the first half of the year.

 

In Beijing, footfall and tenant sales in WF CENTRAL declined significantly due to the pandemic, and the Group as a result provided rent relief in the period to support its retail tenants.

 

In Shanghai, planning of the Group's prime mixed-use site along the Huangpu River in the Xuhui District is underway, with completion expected in multiple phases through to 2027.  Since securing the site and subject to relevant approvals by the authorities, the Group has conditionally finalised agreements with two strategic partners to jointly develop the site, receiving a prepayment of US$2.3 billion in the first half with a further amount received in July of US$320 million. The land premium and related costs of US$4.5 billion were paid in the first half.  Upon completion of the transaction, which is expected by early 2021, the project will be accounted for as a joint venture, with the Group remaining as the largest shareholder.

 

In Bangkok, the planning of the Group's 49%-owned prime retail and Grade A office development in the central business district continues.  The development is expected to complete in 2026.

 

 

Development Properties

On the Chinese mainland, as anticipated the profit contribution from Development Properties in the first half of 2020 decreased compared to the first half of 2019 due to fewer sales completions.  The Group's attributable interest in contracted sales in the first half of 2020 was US$591 million, compared to US$643 million and US$1,225 million in the first and second halves of 2019, respectively. Market sentiment in the Group's core markets started to recover in the second quarter following the temporary closure of all sales galleries and the suspension of construction activities for some two months in the first quarter as a result of the impact of the pandemic.  At 30th June 2020, the Group had US$2,183 million in sold but unrecognised contracted sales, compared with US$1,860 million at the end of 2019.

 

The profit contribution from the Singapore business in the first half of 2020 was lower than in the first half of 2019, as sales galleries and construction activities were suspended for some two months as a result of the pandemic.  The 309-unit Margaret Ville is 92% pre-sold, whilst pre-sales at the 1,404-unit Parc Esta and the 638-unit Leedon Green projects have performed well under current market conditions.  The Group's attributable interest in contracted sales was US$301 million in the first half of 2020, compared to US$255 million and US$414 million in the first and second halves of 2019, respectively.

 

In the rest of Southeast Asia, construction activities at the Group's projects have largely been suspended or curtailed since April and market sentiment remains subdued.

 

Financing

The Group's financial position remains strong.  Net debt increased to US$5.6 billion at 30th June 2020 from US$3.6 billion at the end of 2019, primarily due to land payments for the recently acquired site in Shanghai.  Net gearing was 16% compared with 9% at the end of 2019. As at 30th June 2020, the Group had committed liquidity of US$2.7 billion, compared to US$3.2 billion at the end of 2019. 

 

PEOPLE

On behalf of the Board, I would like to thank our staff for their ongoing commitment, diligence and hard work in responding to the unprecedented challenges brought about by the pandemic.

 

I stepped down as Managing Director on 15th June 2020, and was succeeded by John Witt, who rejoins the Board. I will continue as Chairman. 

 

We are pleased to welcome Prijono Sugiarto to the Board as a Non-executive Director with effect from 29th July 2020.

 

OUTLOOK

While second half underlying profits are expected to benefit from higher Development Properties completions on the Chinese mainland than in the first half, uncertainty remains about the duration of the pandemic and the effect it will have on the Group's full year results.

 

Ben Keswick

Chairman

 

 

Hongkong Land Holdings Limited

Consolidated Profit and Loss Account

 

 

 

(unaudited)

 

 

 

 

Six months ended 30th June

 

Year ended 31st December

 

 

 

2020

 

2019

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Underlying

business

performance

US$m

 

 

 

Non-

trading

items

US$m

 

 

 

Total

US$m

 

 

 

Underlying

business

performance

US$m

 

 

 

Non-

trading

items

US$m

 

 

 

Total

US$m

 

 

 

Underlying

business

performance

US$m

 

 

 

Non-

trading

items

US$m

 

 

 

 

 

Total

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue (note 2)

 

820.2

 

 

 

-

 

 

 

820.2

 

 

 

803.9

 

 

 

-

 

 

 

803.9

 

 

 

2,319.7

 

 

 

-

 

 

 

2, 319 . 7

 

Net operating costs (note 3)

 

(389.4)

 

 

 

-

 

 

 

(389.4)

 

 

 

(334.0)

 

 

 

32. 5

 

 

 

(301.5)

 

 

 

(1,149.3)

 

 

 

34.4

 

 

 

(1, 114 . 9 )

 

Change in fair value of investment properties

 

-

 

 

 

(2,062.9)

 

 

 

(2,062.9)

 

 

 

-

 

 

 

(74.4)

 

 

 

(74.4)

 

 

 

-

 

 

 

(854.2)

 

 

 

(854.2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating (loss)/profit (note 4)

 

430.8

 

 

 

(2,062.9)

 

 

 

(1,632.1)

 

 

 

469.9

 

 

 

(41.9)

 

 

 

428.0

 

 

 

1,170.4

 

 

 

(819.8)

 

 

 

350.6

 

Net financing charges

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

financing charges

 

(99.5)

 

 

 

-

 

 

 

(99.5)

 

 

 

( 100.0 )

 

 

 

-

 

 

 

( 100.0 )

 

 

 

(204.8)

 

 

 

-

 

 

 

(204.8)

 

financing income

 

36.3

 

 

 

-

 

 

 

36.3

 

 

 

40.6

 

 

 

-

 

 

 

40.6

 

 

 

83.4

 

 

 

-

 

 

 

83.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(63.2)

 

 

 

-

 

 

 

(63.2)

 

 

 

(59.4)

 

 

 

-

 

 

 

(59.4)

 

 

 

(121.4)

 

 

 

-

 

 

 

(121.4)

 

Share of results of associates and

  joint ventures (note 5)

 

45.2

 

 

 

(134.5)

 

 

 

(89.3)

 

 

 

127.2

 

 

 

(9.9)

 

 

 

117.3

 

 

 

272.7

 

 

 

(32.6)

 

 

 

240.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit/(loss) before tax

 

412.8

 

 

 

(2,197.4)

 

 

 

(1,784.6)

 

 

 

537.7

 

 

 

(51.8)

 

 

 

485.9

 

 

 

1,321.7

 

 

 

(852.4)

 

 

 

469.3

 

Tax (note 6)

 

(61.7)

 

 

 

12.3

 

 

 

(49.4)

 

 

 

(72.2)

 

 

 

(2.4)

 

 

 

(74.6)

 

 

 

(246.6)

 

 

 

(20.5)

 

 

 

(267.1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit/(loss) after tax

 

351.1

 

 

 

(2,185.1)

 

 

 

(1,834.0)

 

 

 

465.5

 

 

 

(54.2)

 

 

 

411.3

 

 

 

1,075.1

 

 

 

(872.9)

 

 

 

202.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Attributable to:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(note 7 and 8)

 

352.8

 

 

 

(2,180.4)

 

 

 

(1,827.6)

 

 

 

465.9

 

 

 

(55.0)

 

 

 

410.9

 

 

 

1,076.4

 

 

 

(878.4)

 

 

 

198.0

 

Non-controlling interests

 

(1.7)

 

 

 

(4.7)

 

 

 

(6.4)

 

 

 

(0.4)

 

 

 

0.8

 

 

 

0.4

 

 

 

(1.3)

 

 

 

5.5

 

 

 

4.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

351.1

 

 

 

(2,185.1)

 

 

 

(1,834.0)

 

 

 

465.5

 

 

 

(54.2)

 

 

 

411.3

 

 

 

1,075.1

 

 

 

(872.9)

 

 

 

202.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

US¢

 

 

 

 

 

 

 

US¢

 

 

 

US¢

 

 

 

 

 

 

 

US¢

 

 

 

US¢

 

 

 

 

 

 

 

US¢

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share (note 8)

 

15.12

 

 

 

 

 

 

 

(78.31)

 

 

 

19.96

 

 

 

 

 

 

 

17.61

 

 

 

46.12

 

 

 

 

 

 

 

8.48

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                                                                                       

 

Hongkong Land Holdings Limited

Consolidated Statement of Comprehensive Income

 

 

 

 

 

 

 

(unaudited)

Six months ended

30th June

 

 

 

 

Year ended

31st

December

 

 

 

 

 

 

 

 

2020

US$m

 

 

 

 

 

 

 

2019

US$m

 

 

 

 

 

 

 

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss)/p rofit for the period

 

 

 

 

(1, 8 34.0)

 

 

 

 

 

 

 

411.3

 

 

 

 

 

 

 

202.2

 

 

 

Other comprehensive ( expense)/income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Items that will not be reclassified to

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

profit or loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Remeasurements of defined benefit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

plans

 

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

 

 

 

 

2.2

 

 

 

Tax on items that will not be reclassified

 

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

 

 

 

 

(0.4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

 

 

 

 

1.8

 

 

 

Items that may be reclassified

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

subsequently to profit or loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net exchange translation differences

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- net gain arising during the period

 

 

 

 

42.4

 

 

 

 

 

 

 

88.6

 

 

 

 

 

 

 

166.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flow hedges

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- net gain arising during the period

 

 

 

 

3.7

 

 

 

 

 

 

 

13.8

 

 

 

 

 

 

 

25.7

 

 

 

- transfer to profit and loss

 

 

 

 

(0.8)

 

 

 

 

 

 

 

(1.5)

 

 

 

 

 

 

 

(0.6)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.9

 

 

 

 

 

 

 

12.3

 

 

 

 

 

 

 

25.1

 

 

 

Tax relating to items that may be

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

reclassified

 

 

 

 

(0.5)

 

 

 

 

 

 

 

(2.0)

 

 

 

 

 

 

 

(4.1)

 

 

 

Share of other comprehensive

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(expense)/income of associates and

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

joint ventures

 

 

 

 

(127.4)

 

 

 

 

 

 

 

22.7

 

 

 

 

 

 

 

29.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(82.6)

 

 

 

 

 

 

 

121.6

 

 

 

 

 

 

 

216.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive (expense)/income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

for the period, net of tax

 

 

 

 

(82.6)

 

 

 

 

 

 

 

121.6

 

 

 

 

 

 

 

218.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total comprehensive (expense)/income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

for the period

 

 

 

 

(1,916.6)

 

 

 

 

 

 

 

532.9

 

 

 

 

 

 

 

420.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Attributable to:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders of the Company

 

 

 

 

(1,908.8)

 

 

 

 

 

 

 

532.6

 

 

 

 

 

 

 

418.0

 

 

 

Non-controlling interests

 

 

 

 

(7.8)

 

 

 

 

 

 

 

0.3

 

 

 

 

 

 

 

2.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,916.6)

 

 

 

 

 

 

 

532.9

 

 

 

 

 

 

 

420.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                                                                                         

 

 

 

 

Hongkong Land Holdings Limited

Consolidated Balance Sheet

 

 

 

 

 

(unaudited)

At 30th June

 

 

At 31st

December

 

 

 

 

2020

US$m

 

 

 

2019

US$m

 

 

 

2019

US$m

 

 

 

Net operating assets

 

 

 

 

 

 

 

 

 

 

 

 

Fixed assets

 

 

121.9

 

 

 

131.3

 

 

 

127.6

 

Right-of-use assets

 

 

11.2

 

 

 

13.9

 

 

 

12.4

 

Investment properties (note 10)

 

 

35,835.7

 

 

 

33,815.4

 

 

 

33,191.2

 

Associates and joint ventures (note 11)

 

 

6,839.9

 

 

 

7,152.5

 

 

 

7,226.1

 

Other investments

 

 

-

 

 

 

114.5

 

 

 

-

 

Non-current debtors

 

 

60.9

 

 

 

39.9

 

 

 

48.1

 

Deferred tax assets

 

 

16.0

 

 

 

18.6

 

 

 

26.9

 

Pension assets

 

 

0.1

 

 

 

-

 

 

 

0.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-current assets

 

 

42,885.7

 

 

 

41,286.1

 

 

 

40,632.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Properties for sale

 

 

1,975.9

 

 

 

2,065.8

 

 

 

2,042.0

 

Current debtors

 

 

847.9

 

 

 

985.0

 

 

 

1,141.3

 

Current tax assets

 

 

31.7

 

 

 

25.9

 

 

 

19.5

 

Bank balances

 

 

927.6

 

 

 

1,153.9

 

 

 

1,424.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

 

3,783.1

 

 

 

4,230.6

 

 

 

4,626.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current creditors

 

 

(3,740.9)

 

 

 

(1,640.0)

 

 

 

(1,460.8)

 

Current borrowings (note 12)

 

 

(362.8)

 

 

 

(705.4)

 

 

 

(715.3)

 

Current tax liabilities

 

 

(158.1)

 

 

 

(119.9)

 

 

 

(261.0)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

(4,261.8)

 

 

 

(2,465.3)

 

 

 

(2,437.1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net current (liabilities)/assets

 

 

(478.7)

 

 

 

1,765.3

 

 

 

2,189.7

 

Long-term borrowings (note 12)

 

 

(6,192.9)

 

 

 

(4,329.0)

 

 

 

(4,299.9)

 

Deferred tax liabilities

 

 

(202.1)

 

 

 

(176.8)

 

 

 

(210.9)

 

Pension liabilities

 

 

(2.2)

 

 

 

(3.9)

 

 

 

(1.5)

 

Non-current creditors

 

 

(23.5)

 

 

 

(12.7)

 

 

 

(20.0)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

35,986.3

 

 

 

38,529.0

 

 

 

38,289.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total equity

 

 

 

 

 

 

 

 

 

 

 

 

Share capital

 

 

233.4

 

 

 

233.4

 

 

 

233.4

 

Share premium

 

 

257.3

 

 

 

257.3

 

 

 

257.3

 

Revenue and other reserves

 

 

35,473.9

 

 

 

38,010.0

 

 

 

37,756.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders' funds

 

 

35,964.6

 

 

 

38,500.7

 

 

 

38,246.8

 

Non-controlling interests

 

 

21.7

 

 

 

28.3

 

 

 

43.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

35,986.3

 

 

 

38,529.0

 

 

 

38,289.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hongkong Land Holdings Limited

Consolidated Statement of Changes in Equity

 

 

 

Attributable to

shareholders

Attributable to non-

 

 

 

 

Share

capital

US$m

 

Share

premium

US$m

 

Revenue

reserves

US$m

 

Hedging

reserves

US$m

 

Exchange

reserves

US$m

 

of the Company US$m

controlling interests

US$m

 

Total equity US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six months ended 30th June 2020 (unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 1st January 2020

 

233.4

 

257.3

 

38,039.8

 

8.3

 

(292.0)

 

38,246.8

 

43.0

 

38,289.8

Total comprehensive income

 

-

 

-

 

(1,827.6)

 

(8.4)

 

(72.8)

 

(1,908.8)

 

(7.8)

 

(1,916.6)

Dividends paid by the Company (note 9)

 

-

 

-

 

(373.4)

 

-

 

-

 

(373.4)

 

(0.5)

 

(373.9)

Disposal of a subsidiary

 

-

 

-

 

-

 

-

 

-

 

-

 

(13.0)

 

(13.0)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 30th June 2020

 

233.4

 

257.3

 

35,838.8

 

(0.1)

 

(364.8)

 

35,964.6

 

21.7

 

35,986.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six months ended 30th June 2019 (unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 1st January 2019

 

233.4

 

257.3

 

38,352.7

 

(8.8)

 

(493.1)

 

38,341.5

 

28.0

 

38,369.5

Total comprehensive income

 

-

 

-

 

410.9

 

9.5

 

112.2

 

532.6

 

0.3

 

532.9

Dividends paid by the Company (note 9)

 

-

 

-

 

(3 7 3.4)

 

-

 

-

 

(373.4)

 

-

 

(373.4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 30th June 2019

 

233.4

 

257.3

 

38,390.2

 

0.7

 

(380.9)

 

38,500.7

 

28.3

 

38,529.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended 31st December 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 1st January 2019

 

233.4

 

257.3

 

38,352.7

 

(8.8)

 

(493.1)

 

38,341.5

 

28.0

 

38,369.5

Total comprehensive income

 

-

 

-

 

199.8

 

17.1

 

201.1

 

418.0

 

2.8

 

420.8

Dividends paid by the Company

 

-

 

-

 

(513.4)

 

-

 

-

 

(513.4)

 

-

 

(513.4)

Dividends paid to non-controlling shareholders

 

-

 

-

 

-

 

-

 

-

 

-

 

(0.9)

 

(0.9)

Unclaimed dividends forfeited

 

-

 

-

 

0.7

 

-

 

-

 

0.7

 

-

 

0.7

A cquisition of a subsidiary

 

-

 

-

 

-

 

-

 

-

 

-

 

13.1

 

13.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 31st December 2019

 

233.4

 

257.3

 

38,039.8

 

8.3

 

(292.0)

 

38,246.8

 

43.0

 

38,289.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hongkong Land Holdings Limited

Consolidated Cash Flow Statement

 

 

 

 

 

 

 

 

(unaudited)

Six months ended

30th June

 

 

Year ended 31st December

 

 

 

 

 

2020

US$m

 

 

 

2019

US$m

 

 

 

2019

US$m

 

 

 

 

 

 

 

 

Operating activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating (loss)/profit

 

 

(1,632.1)

 

 

 

428.0

 

 

 

350.6

 

Depreciation and amortisation

 

 

7.4

 

 

 

6.5

 

 

 

13.6

 

Change in fair value of investment properties

 

2,062.9

 

 

 

74.4

 

 

 

854.2

 

Gain on disposal of a subsidiary

 

(6.2)

 

 

 

-

 

 

 

-

 

Gain on disposal/change in fair value of other

 

 

 

 

 

 

 

 

 

 

 

 investments

 

-

 

 

 

(32.5)

 

 

 

(34.4)

 

I ncrease in properties for sale

 

 

(51.4)

 

 

 

(98.6)

 

 

 

(1.1)

 

Decrease/(increase) in debtors

 

 

206.2

 

 

 

(52.0)

 

 

 

(186.7)

 

Increase in creditors

 

 

1 29 . 9

 

 

 

216.1

 

 

 

26.7

 

Interest received

 

 

20.1

 

 

 

24.8

 

 

 

50.3

 

Interest and other financing charges paid

 

 

(113.4)

 

 

 

(95.8)

 

 

 

(195.2)

 

Tax paid

 

 

(153.7)

 

 

 

(87.2)

 

 

 

(115.5)

 

Dividends from associates and joint ventures

 

 

36.3

 

 

 

54.1

 

 

 

419.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from operating activities

 

 

506.0

 

 

 

437.8

 

 

 

1,182.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Major renovations expenditure

 

 

(59.1)

 

 

 

(49.8)

 

 

 

(116.4)

 

Developments capital expenditure (note 14)

 

 

(4,488.0)

 

 

 

(16.5)

 

 

 

(27.3)

 

Repayment from/(investments in and

 

 

 

 

 

 

 

 

 

 

 

 

advances to) associates and joint ventures

 

 

96.7

 

 

 

(328.4)

 

 

 

(646.0)

 

Disposal/(acquisition) of a subsidiary

 

 

47.7

 

 

 

-

 

 

 

(25.8)

 

Proceeds on disposal of other investments

 

 

-

 

 

 

38.8

 

 

 

157.5

 

Advance received on conditional disposal of

 

 

 

 

 

 

 

 

 

 

 

 

a subsidiary (note 14)

 

 

2,252.0

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

(2,150.7)

 

 

 

(355.9)

 

 

 

(658 .0)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Drawdown of borrowings

 

 

2,481.7

 

 

 

626.0

 

 

 

1,334.5

 

Repayment of borrowings

 

 

(925.6)

 

 

 

(57 0 . 6 )

 

 

 

(1,309.2)

 

P rincipal elements of lease payments

 

 

(2.1)

 

 

 

(2.2)

 

 

 

(5.1)

 

Dividends paid by the Company

 

 

(367.1)

 

 

 

(369.2)

 

 

 

(510.1)

 

Dividends paid to non-controlling shareholders

 

(0.1)

 

 

 

-

 

 

 

(0.9)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

1,186.8

 

 

 

(316. 0 )

 

 

 

(490.8)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash (outflow)/inflow

 

 

(457.9)

 

 

 

(234. 1 )

 

 

 

33.3

 

Cash and cash equivalents at beginning of

 

 

 

 

 

 

 

 

 

 

 

 

period

 

 

1,418.0

 

 

 

1,368.9

 

 

 

1,368.9

 

Effect of exchange rate changes

 

 

(35.1)

 

 

 

14.2

 

 

 

15.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at end of period

 

 

925.0

 

 

 

1,149.0

 

 

 

1,418.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                                                     

 

Hongkong Land Holdings Limited

Notes to Condensed Financial Statements

 

 

 

1.  ACCOUNTING POLICIES AND BASIS OF PREPARATION

 

The condensed financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting' and on a going concern basis.  The condensed financial statements have not been audited or reviewed by the Group's auditors pursuant to the UK Auditing Practices Board guidance on the review of interim financial information.

 

The Group had early adopted the 'Interest Rate Benchmark Reform: Amendments to IFRS 9, IAS 39 and IFRS 7' (effective 1st January 2020) for the Group's annual reporting period commencing 1st January 2019.

 

There are no changes to the accounting policies as described in the 2019 annual financial statements.  Amendments which are effective in 2020 and relevant to the Group's operations do not have a significant effect on the Group's accounting policies. The Group has not early adopted any other standard or amendments that have been issued but not yet effective.

 

 

2.  REVENUE

 

 

Six months ended 30th June

 

 

 

 

 

2020

US$m

 

 

 

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental income

 

 

466.5

 

 

 

509.6

 

 

Service income

 

 

67.6

 

 

 

75.3

 

 

Sales of properties

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- recognised at a point in time

 

 

102.0

 

 

 

33.6

 

 

- recognised over time

 

 

184.1

 

 

 

185.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

286.1

 

 

 

219.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

820.2

 

 

 

803.9

 

 

By business

 

 

 

 

 

 

 

 

 

Investment Properties

 

 

530.3

 

 

 

581.2

 

 

Development Properties

 

 

289.9

 

 

 

222.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

820.2

 

 

 

803.9

 

 

 

3.  NET OPERATING COSTS

 

 

Six months ended 30th June

 

 

 

 

 

2020

US$m

 

 

 

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

 

(321.8)

 

 

 

(256.7)

 

 

Other income

 

 

6.7

 

 

 

11.6

 

 

Gain on disposal of a subsidiary

 

 

6.2

 

 

 

-

 

 

Administrative expenses

 

 

(80.5)

 

 

 

(88.9)

 

 

Change in fair value of other investments

 

 

-

 

 

 

32.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(389.4)

 

 

 

(301.5)

 

 

 

4.  OPERATING (LOSS)/ PROFIT

 

 

Six months ended 30th June

 

 

 

 

 

2020

US$m

 

 

 

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

By business

 

 

 

 

 

 

 

 

 

Investment Properties

 

 

432.2

 

 

 

482.6

 

 

Development Properties

 

 

35.9

 

 

 

27.5

 

 

Corporate

 

 

(37.3)

 

 

 

(40.2)

 

 

 

 

 

 

 

 

 

 

 

 

Underlying business performance

 

 

430.8

 

 

 

469.9

 

 

Change in fair value of investment properties

 

 

(2,062.9)

 

 

 

(74.4)

 

 

Change in fair value of other investments

 

 

-

 

 

 

32.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,632.1)

 

 

 

428.0

 

 

 

5.  SHARE OF RESULTS OF ASSOCIATES AND JOINT VENTURES

 

 

Six months ended 30th June

 

 

 

 

 

2020

US$m

 

 

 

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

By business

 

 

 

 

 

 

 

 

 

Investment Properties

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- operating profit

 

 

60.7

 

 

 

72.0

 

 

- net financing charges

 

 

(20.2)

 

 

 

(25.9)

 

 

- tax

 

 

(7.6)

 

 

 

(8.5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- net profit

 

 

32.9

 

 

 

37.6

 

 

 

 

 

 

 

 

 

 

 

Development Properties

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- operating profit

 

 

41.4

 

 

 

166.0

 

 

- net financing charges

 

 

(6.2)

 

 

 

(7.7)

 

 

- tax

 

 

(19.7)

 

 

 

(61.1)

 

 

- non-controlling interests

 

 

(3.2)

 

 

 

(7.6)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- net profit

 

 

12.3

 

 

 

89.6

 

 

 

 

 

 

 

 

 

 

 

 

Underlying business performance

 

 

45.2

 

 

 

127.2

 

 

Change in fair value of investment properties

 

 

 

 

 

 

 

 

 

(net of deferred tax)

 

 

(134.5)

 

 

 

(9.9)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(89.3)

 

 

 

117.3

 

 

 

6.  TAX

 

 

Six months ended 30th June

 

 

 

 

 

2020

US$m

 

 

 

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tax charged to profit and loss is analysed as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current tax

 

 

(40.8)

 

 

 

(72.5)

 

 

Deferred tax

 

 

 

 

 

 

 

 

 

- changes in fair value of investment properties

 

 

12.3

 

 

 

(2.4)

 

 

- other temporary differences

 

 

(20.9)

 

 

 

0.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(49.4)

 

 

 

(74.6)

 

 

 

 

 

 

 

 

 

 

 

 

Tax relating to components of other comprehensive income is analysed as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flow hedges

 

 

(0.5)

 

 

 

(2.0)

 

 

Tax on profits has been calculated at the rates of taxation prevailing in the territories in which the Group operates.

 

Share of tax charge of associates and joint ventures of US$18.8 million (201 9 : US$ 68 . 6 million) is included in share of results of associates and joint ventures.

 

 

7.  NON-TRADING ITEMS

 

Non-trading items are separately identified to provide greater understanding of the Group's underlying business performance.  Items classified as non-trading items include fair value gains or losses on revaluation of investment properties and equity investments which are measured at fair value through profit and loss; gains and losses arising from the sale of businesses, investments and investment properties; impairment of non-depreciable intangible assets and other investments; provisions for the closure of businesses; acquisition-related costs in business combinations; and other credits and charges of a non-recurring nature that require inclusion in order to provide additional insight into underlying business performance.

 

An analysis of non-trading items after interest, tax and non-controlling interests is set out below:

 

 

Six months ended 30th June

 

 

 

 

20 20

US$m

 

201 9

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in fair value of investment properties

 

(2,062.9)

 

(74.4)

 

Deferred tax on change in fair value of investment properties

 

12.3

 

(2.4)

 

Share of change in fair value of investment properties of

 

 

 

 

 

associates and joint ventures (net of deferred tax)

 

(134.5)

 

(9.9)

 

Change in fair value of other investments

 

-

 

32.5

 

Non-controlling interests

 

4.7

 

(0.8)

 

 

 

 

 

 

 

 

 

(2,180.4)

 

 (55.0)

             

 

 

8.  EARNINGS PER SHARE

 

Earnings per share are calculated on loss attributable to shareholders of US$1,827.6 million (201 9 : profit US$ 410 . 9 million) and on the weighted average number of 2,333.9 million (201 9 : 2,3 33 . 9 million) shares in issue during the period.

 

Earnings per share are additionally calculated based on underlying profit attributable to   shareholders.  A reconciliation of earnings is set out below:

 

 

 

 

Six months ended 30th June

 

 

 

2020

 

2019

 

 

 

 

 

 

 

 

 

 

US$m

Earnings

per share

US¢

 

US$m

 

Earnings

per share

US¢

 

 

 

 

 

 

 

 

 

 

 

 

 

Underlying profit attributable to shareholders

 

352.8

 

15.12

 

465.9

 

19.96

 

Non-trading items (note 7)

 

(2,180.4)

 

 

 

(55.0)

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss)/profit attributable to shareholders

 

(1,827.6)

 

(78.31)

 

410.9

 

17.61

                     

 

 

9.  DIVIDENDS

 

 

Six months ended 30th June

 

 

 

2020

US$m

 

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

Final dividend in respect of 2019 of US¢ 16 .00

(2018: US¢16.00) per share 

 

373.4

 

373.4

 

An interim dividend in respect of 20 20 of US¢ 6 .00 (2019: US¢6.00) per share amounting to a total of US$140.0 million (2019: US$140. 0 million) is declared by the Board and will be accounted for as an appropriation of revenue reserves in the year ending 31st December 20 20 .

 

 

10. INVESTMENT PROPERTIES

 

 

Six months ended 30th June

Year ended

31st

December

 

 

 

2020

US$m

 

2019

US$m

 

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At beginning of period

 

33,191.2

 

33,712.1

 

33,712.1

 

Exchange differences

 

154.3

 

77.0

 

190.6

 

Additions

 

4,553.1

 

100.7

 

142.7

 

Decrease in fair value

 

(2,062.9)

 

(74.4)

 

(854.2)

 

 

 

 

 

 

 

 

 

At end of period

 

35,835.7

 

33,815.4

 

33,191.2

 

 

11. ASSOCIATES AND JOINT VENTURES

 

 

At 30th June

 At 31st

December

 

 

 

2020

US$m

 

2019

US$m

 

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By business

 

 

 

 

 

 

 

Investment Properties

 

3,540.0

 

3,944.4

 

3,753.7

 

Development Properties

 

3,299.9

 

3,208.1

 

3,472.4

 

 

 

 

 

 

 

 

 

 

 

6,839.9

 

7,152.5

 

7,226.1

 

 

12. BORROWINGS

 

 

 

At 30th June

 

At 31st December

 

 

 

 

 

2020

US$m

 

 

 

2019

US$m

 

 

 

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bank overdrafts

 

 

2.6

 

 

 

4.9

 

 

 

6.0

 

 

Bank loans

 

 

317.3

 

 

 

286.4

 

 

 

383.8

 

 

Current portion of long-term borrowings

 

 

 

 

 

 

 

 

 

 

 

 

 

- bank loans

 

 

42.9

 

 

 

8.4

 

 

 

21.4

 

 

- medium term notes

 

 

-

 

 

 

405.7

 

 

 

304.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

362.8

 

 

 

705.4

 

 

 

715.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-term

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bank loans

 

 

2,401.8

 

 

 

1,494.7

 

 

 

1,281.5

 

 

Medium term notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- due 2021

 

 

66.7

 

 

 

66.1

 

 

 

65.5

 

 

- due 2022

 

 

623.9

 

 

 

614.5

 

 

 

614.7

 

 

- due 2023

 

 

180.1

 

 

 

178.4

 

 

 

179.2

 

 

- due 2024

 

 

416.1

 

 

 

407.1

 

 

 

406.7

 

 

- due 2025

 

 

647.0

 

 

 

648.0

 

 

 

647.5

 

 

- due 2026

 

 

38.8

 

 

 

38.4

 

 

 

38.6

 

 

- due 2027

 

 

186.8

 

 

 

185.2

 

 

 

186.0

 

 

- due 2028

 

 

183.5

 

 

 

181.9

 

 

 

182.6

 

 

- due 2029

 

 

121.9

 

 

 

50.6

 

 

 

121.3

 

 

- due 2030

 

 

697.6

 

 

 

102.4

 

 

 

102.8

 

 

- due 2031

 

 

25.5

 

 

 

25.3

 

 

 

25.4

 

 

- due 2032

 

 

140.7

 

 

 

30.2

 

 

 

30.3

 

 

- due 2033

 

 

89.6

 

 

 

88.8

 

 

 

89.2

 

 

- due 203 4

 

 

77.5

 

 

 

76 . 9

 

 

 

77.2

 

 

- due 203 5

 

 

51.1

 

 

 

-

 

 

 

-

 

 

- due 2038

 

 

105.6

 

 

 

108.6

 

 

 

109.2

 

 

- due 203 9

 

 

106.6

 

 

 

-

 

 

 

110.2

 

 

- due 2040

 

 

32.1

 

 

 

31.9

 

 

 

32.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3,791.1

 

 

 

2,834.3

 

 

 

3,018.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6,192.9

 

 

 

4,329.0

 

 

 

4,299.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6,555.7

 

 

 

5,034.4

 

 

 

5,015.2

 

 

13. FINANCIAL INSTRUMENTS

 

Financial instruments by category

The fair values of financial assets and financial liabilities, together with carrying amounts at 30th June 2020 and 31st December 2019 are as follows:

 

Fair value of

 hedging

instruments

US$m

Financial

assets at amortised costs

US$m

 

 

Other

 financial liabilities at amortised costs

US$m

Total

carrying amount

US$m

Fair

value

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30th June 2020

 

 

 

 

 

 

 

 

 

 

Financial assets measured at fair value

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments

50.6

 

-

 

-

 

50.6

 

50.6

 

 

 

 

 

 

 

 

 

 

 

 

Financial assets not measured at fair

 

 

 

 

 

 

 

 

 

 

value

 

 

 

 

 

 

 

 

 

 

Debtors

-

 

197.9

 

-

 

197.9

 

197.9

 

Bank balances

-

 

927.6

 

-

 

927.6

 

927.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

1,125.5

 

-

 

1,125.5

 

1,125.5

 

 

 

 

 

 

 

 

 

 

 

 

Financial liabilities measured at fair

 

 

 

 

 

 

 

 

 

 

value

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments

(5.0)

 

-

 

-

 

(5.0)

 

(5.0)

 

 

 

 

 

 

 

 

 

 

 

 

Financial liabilities not measured at

 

 

 

 

 

 

 

 

 

 

fair value

 

 

 

 

 

 

 

 

 

 

Borrowings

-

 

-

 

(6,555.7)

 

(6,555.7)

 

(6,820.8)

 

Trade and other payable excluding

 

 

 

 

 

 

 

 

 

 

non-financial liabilities

-

 

-

 

(673.8)

 

(673.8)

 

(673.8)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

-

 

(7,229.5)

 

(7,229.5)

 

(7,494.6)

                       

 

 

31st December 2019

 

 

 

 

 

 

 

 

 

 

 

 

Financial assets measured at fair value

 

 

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments

30.5

 

-

 

-

 

30.5

 

30.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial assets not measured at fair

 

 

 

 

 

 

 

 

 

 

 

value

 

 

 

 

 

 

 

 

 

 

 

Debtors

-

 

345.8

 

-

 

345.8

 

345.8

 

 

Bank balances

-

 

1,424.0

 

-

 

1,424.0

 

1,424.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

1,769.8

 

-

 

1,769.8

 

1,769.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial liabilities measured at fair

 

 

 

 

 

 

 

 

 

 

 

value

 

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments

(4.7)

 

-

 

-

 

(4.7)

 

(4.7)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial liabilities not measured at

 

 

 

 

 

 

 

 

 

 

 

fair value

 

 

 

 

 

 

 

 

 

 

 

Borrowings

-

 

-

 

(5,015.2)

 

(5,015.2)

 

(5,174.4)

 

 

Trade and other payable excluding

 

 

 

 

 

 

 

 

 

 

 

non-financial liabilities

-

 

-

 

(900.9)

 

(900.9)

 

(900.9)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

-

 

(5,916.1)

 

(5,916.1)

 

(6,075.3)

 

                                       

 

 

Fair value estimation

(a) Financial instruments that are measured at fair value

Financial instruments carried at fair value at 30th June 20 20 and 31st December 201 9 a re analysed as follows:

 

 

 

 

 

  At 30th June 2020

US$m

 

At 31st December

2019

US$m

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

Derivative financial instruments at fair value

 

 

 

 

 

 

 

- through other comprehensive income

 

 

 

22.7

 

19.7

 

- through profit and loss

 

 

 

27.9

 

10.8

 

 

 

 

 

 

 

 

 

 

 

 

 

50.6

 

30.5

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

Derivative financial instruments at fair value

 

 

 

 

 

 

 

- through other comprehensive income

 

 

 

(5.0)

 

(1.8)

 

- through profit and loss

 

 

 

-

 

(2.9)

 

 

 

 

 

 

 

 

 

 

 

 

 

(5.0)

 

(4.7)

 

 

 

 

 

 

 

 

The fair values of derivative financial instruments are determined using rates quoted by the Group's bankers at the balance sheet date.  The rates for interest rate swaps and forward foreign exchange contracts are calculated by reference to market interest rates and foreign exchange rates.

 

There were no changes in valuation techniques during the six months ended 30th June 20 20 and the year ended 31st December 201 9 .

 

(b) Financial instruments that are not measured at fair value

The fair values of current debtors, bank balances, current creditors and current borrowings are assumed to approximate their carrying amounts due to the short-term maturities of these assets and liabilities.

 

The fair values of long-term borrowings are based on market prices or are estimated using the expected future payments discounted at market interest rates.

 

 

14. NOTES TO CONSOLIDATED CASH FLOW STATEMENT

 

In February 2020, the Group acquired a mixed-use site along the Huangpu River in the Xuhui District in Shanghai ('the West Bund project') for a cost of US$4.5 billion. Subject to relevant approvals by the authorities, the Group has conditionally finalised agreements with two partners to jointly develop the West Bund project, receiving an advance of US$2.3 billion in the first half of 2020 and a further advance of US$0.3 billion in July 2020.

 

15. CAPITAL COMMITMENTS AND CONTINGENT LIABILITIES

 

Total capital commitments at 30th June 2020 and 31st December 2019 amounted to US$3,798.7 million (including US$2,641.9 million development capital expenditure of the West Bund project) and US$1,144.7 million, respectively.

 

Various Group companies are involved in litigation arising in the ordinary course of their respective businesses.  Having reviewed outstanding claims and taking into account legal advice received, the Directors are of the opinion that adequate provisions have been made in the condensed financial statements.

 

 

16. RELATED PARTY TRANSACTIONS

 

The parent company of the Group is Jardine Strategic Holdings Limited and the ultimate holding company is Jardine Matheson Holdings Limited ('JMH').  Both companies are incorporated in Bermuda.

 

In the normal course of business, the Group has entered into a variety of transactions with the subsidiaries, associates and joint ventures of JMH ('Jardine Matheson group members').  The more significant of these transactions during the six months ended 30th June 2020 are described below:

 

Management fee  

The management fee payable by the Group, under an agreement entered into in 1995, to Jardine Matheson Limited ('JML') was US$1.8 million (2019: US$2.3million), being 0.5% per annum of the Group's underlying profit in consideration for management consultancy services provided by JML, a wholly-owned subsidiary of JMH.

 

Property and other services  

The Group rented properties to Jardine Matheson group members.  Gross rents on such properties amounted to US$10.3 million (2019: US$12.3 million).

 

The Group provided project management services and property management services to Jardine Matheson group members amounted to US$1.3 million (2019: Nil).

 

Jardine Matheson group members provided property maintenance and other services to the Group in aggregate amounted to US$25.1 million (2019: US$23.9 million).

 

Hotel management services  

Jardine Matheson group members provided hotel management services to the Group amounted to US$0.4 million (2019: US$1.3 million).

 

Outstanding balances with associates and joint ventures

Amounts of outstanding balances with associates and joint ventures are included in debtors and creditors as appropriate.  The amounts are not material.

 

 

 

Hongkong Land Holdings Limited

Principal Risks and Uncertainties

 

 

The Board has overall responsibility for risk management and internal control.  The following have been identified previously as the areas of principal risk and uncertainty facing the Company, and they remain unchanged:

 

• Economic Risk and Financial Risk

• Commercial Risk

• Regulatory and Political Risk

• Pandemic, Natural Disasters, Climate Change and Terrorism

 

For greater detail, please refer to page 85 of the Company's Annual Report for 2019, a copy of which is available on the Company's website www.hkland.com.

 

 

Responsibility Statement

 

 

The Directors of the Company confirm to the best of their knowledge that:

 

(a) the condensed financial statements have been prepared in accordance with IAS 34; and

 

(b) the interim management report includes a fair review of all information required to be disclosed by the Disclosure Guidance and Transparency Rules 4.2.7 and 4.2.8 issued by the Financial Conduct Authority in the United Kingdom.

 

For and on behalf of the Board

 

Robert Wong

Simon Dixon

 

Directors

 

 

Dividend Information for Shareholders

 

 

The interim dividend of US¢6.00 per share will be payable on 14th October 2020 to shareholders on the register of members at the close of business on 21st August 2020.  The shares will be quoted ex-dividend on 20th August 2020, and the share registers will be closed from 24th to 28th August 2020, inclusive. 

 

Shareholders will receive their cash dividends in United States Dollars, except when elections are made for alternate currencies in the following circumstances.

 

Shareholders on the Jersey branch register

 

Shareholders registered on the Jersey branch register will have the option to elect for their dividends to be paid in Sterling.  These shareholders may make new currency elections for the 2020 interim dividend by notifying the United Kingdom transfer agent in writing by 25th September 2020.  The Sterling equivalent of dividends declared in United States Dollars will be calculated by reference to a rate prevailing on 30th September 2020. 

 

Shareholders holding their shares through CREST in the United Kingdom will receive their cash dividends in Sterling only as calculated above.

 

Shareholders on the Singapore branch register who hold their shares through The Central Depository (Pte) Limited ('CDP')

 

Shareholders who are on CDP's Direct Crediting Service ('DCS')

For those shareholders who are on CDP's DCS, they will receive their cash dividends in Singapore Dollars unless they opt out of CDP Currency Conversion Service, through CDP, to receive United States Dollars.

 

Shareholders who are not on CDP's DCS

For those shareholders who are not on CDP's DCS, they will receive their cash dividends in United States Dollars unless they elect, through CDP, to receive Singapore Dollars.

 

Shareholders on the Singapore branch register who wish to deposit their shares into the CDP system by the dividend record date, being 21st August 2020, must submit the relevant documents to M & C Services Private Limited, the Singapore branch registrar, by no later than 5.00 p.m. (local time) on 20th August 2020.

 

 

About Hongkong Land Group

 

 

Hongkong Land is a major listed property investment, management and development group.  Founded in 1889, Hongkong Land's business is built on excellence, integrity and partnership.

 

The Group owns and manages more than 850,000 sq. m. of prime office and luxury retail property in key Asian cities, principally in Hong Kong, Singapore, Beijing and Jakarta.  Its properties attract the world's foremost companies and luxury brands. 

 

The Group's Central Hong Kong portfolio represents some 450,000 sq. m. of prime property.  It has a further 165,000 sq. m. of prestigious office space in Singapore mainly held through joint ventures, a luxury retail centre at Wangfujing in Beijing, and a 50% interest in a leading office complex in Central Jakarta.  The Group also has a number of high quality residential, commercial and mixed-use projects under development in cities across Greater China and Southeast Asia.  In Singapore, its subsidiary, MCL Land, is a well-established residential developer.

 

Hongkong Land Holdings Limited is incorporated in Bermuda and has a standard listing on the London Stock Exchange, with secondary listings in Bermuda and Singapore.  The Group's assets and investments are managed from Hong Kong by Hongkong Land Limited.  Hongkong Land is a member of the Jardine Matheson Group. 

 

- end -

 

For further information, please contact:

 

Hongkong Land Limited

 

Robert Wong

(852) 2842 8428

Simon Dixon

(852) 2842 8101

 

 

Brunswick Group Limited

 

David Ashton

(852) 3512 5063

 

As permitted by the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority in the United Kingdom, the Company will not be posting a printed version of the Half-Yearly Results announcement to shareholders.  The Half-Yearly Results announcement will remain available on the Company's website, www.hkland.com, together with other Group announcements.

 


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
 
END
 
 
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