2015 half-yearly results - hongkong landpalms @ sixth avenue jurong west street 41. 2015 half-yearly...

Presentation

31st July 2015

2015 Half-Yearly Results

2015 Half-Yearly Results1

2015 Half-Yearly Review

• Underlying profit down 3%

• Strong performance from commercial portfolio maintained

• Another solid residential contribution

• Stable asset values


2015 Half-Yearly Results Highlights

2014 June ’15 June ’14

US$930m Underlying profit attributable to shareholders US$419m US$433m

US$397m Non-trading items US$94m US$130m

US$1,327m Profit attributable to shareholders US$513m US$563m

US¢39.52 Underlying earnings per share US¢ 17.82 US¢18.38

US¢56.42 Earnings per share US¢ 21.79 US¢23.91

US$11.71 NAV per share US$11.76 US$11.53

N/A Interim dividend per share US¢ 6.00 US¢6.00


Commercial Property


Commercial Portfolio (’000 sq. ft NFA)

HKL’s Share Office Retail Hotel Total

Hong Kong 4,140 590 143 4,873

Macau - 94 151 245

Singapore 1,651 134 - 1,785

Jakarta 662 66 - 728

Hanoi 105 11 - 116

Bangkok 27 60 - 87

Others 71 - 312 383

TOTAL 6,656 955 606 8,217


Hong Kong

1. One Exchange Square

2. Two Exchange Square

3. Three Exchange Square

4. The Forum

5. Jardine House

6. Chater House

7. Alexandra House

8. Gloucester Tower

9. Edinburgh Tower

9a. The Landmark Mandarin Oriental

10. York House

11. Landmark Atrium

12. Prince’s Building

12

5

1 2

36

89

710

4

119a


Hong Kong Central Grade “A” Office Rental Index

80

100

120

140

160

180

2010 2011 2012 2013 2014 1H '15

Index

Source: Jones Lang LaSalle


Hong Kong Central Grade “A” Office Market

-0.5

0

0.5

1

1.5

2

2.5

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19

Vacancy %m sq. ftNew supply Net take up Vacancy

0

3

6

9

12

15

Disclaimer: The above forecast shall be regarded solely as a general guide. No representation is made nor responsibilityaccepted by Jones Lang LaSalle for the accuracy of the whole or any part whatsoever.



-2

0

2

4

6

8

10

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19

Vacancy %m sq. ftNew supply Net take up Vacancy

8

Hong Kong Grade “A” Office Market

0

3

6

9

12

15




Hongkong Land Central Portfolio: Office

1H 2014 2H 2014 1H 2015

Average Net Rent (HK$ psf/month) 103 101 101

Period-end Vacancy 6.0% 5.4% 4.2%

Weighted Average Lease Expiry (years) 3.4 3.4 3.5


Hong Kong: Office Tenant Profile

Banks and other financial

services

39%

Legal

31%

Accounting

8%

Governments

1%

Trading

2%

Property

6%

Others

13%


Hong Kong: Expiration and Interim Rent Revisions

2H 2015 2016 2017

Total lettable office area subject toexpiration/rent revisions (‘000 sq. ft)

468 845 1,457

% of area subject to expiration/rent revisions 11% 21% 35%

Average expiring net rent (HK$ psf/month) 100 105 104


Hongkong Land Central Portfolio: Retail

Note: Vacancy excludes areas under renovation.

1H 2014 2H 2014 1H 2015

Average Net Rent (HK$ psf/month) 210 218 219

Period-end Vacancy 0% 0% 0%



Singapore

One Raffles Link(100%-owned)

Marina Bay Financial Centre(33%-owned)

One Raffles Quay(33%-owned)

13


-1

0

1

2

3

4

5

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19

Vacancy %m sq. ft New supply Net take up Vacancy

14

Singapore CBD Grade “A” Office Market

CBD – Raffles Place, Shenton Way, Marina Bay & Marina Centre

0

3

6

12

15

9




Office Retail Total HKL’s Share

One Raffles Link 239 73 312 312

One Raffles Quay 1,329 4 1,333 445

Marina Bay Financial Centre 2,906 179 3,085 1,028

TOTAL 4,474 256 4,730 1,785

Singapore Commercial Portfolio (’000 sq. ft NFA)


Singapore: Office Tenant Profile

Banks and

other financial

services74%

Legal

6%

Accounting

3%

Natural

resources8%

Others

9%


Singapore: Office Average Rents and Vacancy

Note: According to local market practice, the average office rent includes management charges.

1H 2014 2H 2014 1H 2015

Average Gross Rent (S$ psf/month) 9.1 9.2 9.5

Period-end Vacancy 1.4% 1.7% 1.9%



Singapore: Expiration and Interim Rent Revisions

Note: According to local market practice, the average office rent includes management charges.

2H 2015 2016 2017

HKL’s Share: Total lettable office area subject to expiration/rent revisions (‘000 sq. ft)

79 248 317

% of area subject to expiration/rent revisions 5% 15% 19%

Average expiring rent (S$ psf/month) 9.6 11.4 9.3


• Existing portfolio features 135,000 sq. m.

• Average gross rent: US$25 psm per month(1H 2014: US$24 psm per month)

• Occupancy: 92%

• WTC 3: Piling and excavation of the basement levels have been completed (Completion: 2018)

Jakarta

Jakarta Land (50%-owned)

WTC 3


Hanoi and Bangkok

20

63 Ly Thai To

(74%-owned)

Gaysorn

(49%-owned)

Central Building

(71%-owned)


Phnom Penh

21

EXCHANGE SQUARE (100%-owned)

• Mixed-use complex of 30,000 sq. m.

• Heart of Phnom Penh

• Completion: 2017


• Prestigious retail centre, which includes a small luxury hotel

• 43,000 sq. m. lettable retail area

• Topped-out: 24th June

• Completion: end-2016

Beijing

WF CENTRAL (90%-owned)


• Prime Grade “A” office

• 120,000 sq. m. lettable area


Beijing

CBD (30%-owned)


Residential Property


Mainland China – Completed Projects, Beijing

Project Project Type

Maple Place (90%)

• 7 units handed over in 1H 2015

• 52 units available for future sale, mostly leased

Central Park (40%) • 72 units of serviced apartments

Maple Place

Central Park


Project Interest Project Type

Yorkville South, Chongqing 100% Primarily Residential

Yorkville North, Chongqing 100% Residential (74%), Office, Retail & Others

Bamboo Grove, Chongqing 50% Primarily Residential

Landmark Riverside, Chongqing 50% Residential (76%), Office, Retail & Others

Central Avenue, Chongqing 50% Residential (66%), Office & Retail

Chengdu Project 50% Residential (65%), Office, Retail & Others

Shenyang Projects 50% Primarily Residential

Mainland China – Development Projects Summary


Mainland China – Development Projects Summary

HKL’s Share

ProjectYear of

AcquisitionSite Area

(ha)

DevelopableArea

(m sq. m.)

Constructed(m sq. m.)

Under Construction

(m sq. m.)

Yorkville South, Chongqing 2010 39 0.88 0.28 0.27

Yorkville North, Chongqing 2011 54 1.09 0.21 0.21

Bamboo Grove, Chongqing 2005 39 0.73 0.59 0.08

Landmark Riverside, Chongqing 2009 17 0.75 0.10 0.09

Central Avenue, Chongqing 2013 20 0.55 - 0.04

Chengdu Project 2010 10 0.45 0.07 0.09

Shenyang Projects 2007 34 0.65 0.04 -

TOTAL 213 5.10 1.29 0.78


Mainland China – Revenue Recognised

US$m

Note: The above chart includes HKL’s share of Joint Ventures & Associates.

$37m

$414m

$102m

$519m

$276m

0

100

200

300

400

500

600

1H '13 2H '13 1H '14 2H '14 1H '15

Chongqing Chengdu Shenyang Beijing


Mainland China – Contracted Sales

Note: The above chart includes HKL’s share of Joint Ventures & Associates.

$369m

$263m $262m

$373m$328m

0

100

200

300

400

500

600

1H '13 2H '13 1H '14 2H '14 1H '15

Chongqing Chengdu Shenyang BeijingUS$m


Mainland China – Contracted Sales

• At 30th June 2015, US$585m (2014: US$533m) in sold but unrecognised contracted sales

• Some 45% of contracted sales scheduled to be recognised in 2H 2015


• Site area: 87,180 sq. m.

• Residential and commercial

Mainland China – Development Project, Shanghai

Yangjing District, Pudong (50%-owned)


• Adjacent to Bamboo Grove

• Site area: 348,000 sq. m.

• Primarily residential

Mainland China – New Project, Chongqing

Dazhulin Area (50%-owned)

CentralDowntown

Jiangbeizui CBD

JiefangbeiCBD

Landmark Riverside

Yorkville South

Yorkville North

Project

Chongqing Airport

Chongqing Int’lExhibition Centre

ChongqingCentral Park

Central Avenue

Background image from Google Earth

Bamboo

Grove


Singapore

Hallmark Residences

J Gateway

Ripple BayLakeVille

Marina Bay Suites

Sol AcresPalms @ Sixth Avenue

Jurong WestStreet 41


• 221 units, 0.47m sq. ft


• 15 units sold in 2015

• 3 units available for sale

Singapore – Completed Project

Marina Bay Suites (33%-owned)


Singapore – Completions in 1H 2015

Project UnitsGFA

(‘000 sq. ft)Sold

Hallmark Residences 75 110 97%

Palms @ Sixth Avenue 32 109 88%

Hallmark Residences

Palms @ Sixth Avenue


Singapore – Completion in 2H 2015

• 679 units, 0.67m sq. ft GFA

• 100% pre-sold

Ripple Bay


Singapore – Projects for Completion from 2016

Project UnitsGFA

(‘000 sq. ft)Estimated

Completion DatePre-Sold

J Gateway 738 576 2016 100%

LakeVille 699 741 2017 71%

Sol Acres(previously known as Choa Chu Kang Grove )

1,327 1,240 2018Not yet

launched

TOTAL 2,764 2,557


Singapore – New Site

• Jurong Lake District

• Adjacent to LakeVille

• Site area: 192,000 sq. ft

• Some 700 units

Jurong West Street 41

Jurong West Street 41 LakeVille

Background image from Google Earth


• JV with PT Bumi Serpong Damai

• Site area: 67 ha

• Southwest of central Jakarta

• Lancewood: 223 units launched for sale; 64% pre-sold

• Completion of Lancewood: 2016

Indonesia

Nava Park, Greater Jakarta (49%-owned)


• JV with Astra International

• 509 units of luxury apartments; 87% pre-sold


Indonesia

Anandamaya Residences (40%-owned)


• JV with Ayala Land

• 182 units; 80% pre-sold


Philippines

Two Roxas Triangle (40%-owned)

42

Financial Results



Consolidated Profit and Loss Account (US$m)

2014Full Year

2015Half-Year

2014Half-Year

1,876 Revenue 905 602

(809) Net operating costs (449) (141)

1,067 Operating profit 456 461

123 Share of results of joint ventures 86 76

(69) Net financing charges (38) (34)

(187) Tax (82) (68)

(4) Non-controlling interests (3) (2)

930 Underlying profit 419 433

397 Non-trading items 94 130

1,327 Profit attributable to shareholders 513 563


Revenue (US$m)

2014Full Year

2015Half-Year

2014Half-Year

961 Commercial revenue 483 484

915 Residential revenue 422 118

1,876 Total 905 602


Underlying Profit by Business (US$m)

2014Full Year

2015Half-Year

2014Half-Year

953 Commercial property 477 485

398 Residential property 145 123

(62) Corporate expenses (31) (30)

1,289 591 578

(103) Net financing charges (54) (52)

(247) Tax (112) (91)

(9) Non-controlling interests (6) (2)

930 Underlying profit 419 433


Commercial Property Underlying Profit (US$m)

2014Full Year

2015Half-Year

2014Half-Year

Greater China

772 - Hong Kong 391 391

29 - Mainland China & Macau 12 16

Southeast Asia & Others

130 - Singapore 63 67

22 - Others 11 11

953 Total 477 485


Residential Property Underlying Profit (US$m)

2014Full Year

2015Half-Year

2014Half-Year

Greater China

69 - Hong Kong (5) 49

179 - Mainland China & Macau 109 39


149 - Singapore 42 33

1 - Others (1) 2

398 Total 145 123


Consolidated Cash Flow (US$m)

2014Full Year

2015Half-Year

2014Half-Year

699 Operating activities 201 227

88 Investing activities 189 (106)

(426) Financing activities (306) (282)

7 Others (2) (37)

368 Decrease/(Increase) in net debt 82 (198)

(3,025) Net debt at beginning of period (2,657) (3,025)

(2,657) Net debt at end of period (2,575) (3,223)


Operating Activities (US$m)

2014Full Year

2015Half-Year

2014Half-Year

1,067 Operating profit excl. non-trading items 456 461

(81) Net interest paid (41) (39)

(134) Tax paid (67) (43)

(429) Payments for residential sites (259) (364)

(454) Dev. expenditure on residential projects (201) (177)

962 Proceeds from residential sales 418 474

153 Dividends received from joint ventures 45 64

(385) Others (150) (149)

699 201 227


Investing Activities (US$m)

2014Full Year

2015Half-Year

2014Half-Year

(38) Major renovations capex (22) (23)

(216) Funding of joint ventures (10) (49)

479 Loan repayments from joint ventures 278 42

(137) Development expenditure (57) (76)

88 189 (106)


Consolidated Cash Flow (US$m)

2014Full Year

2015Half-Year

2014Half-Year

699 Operating activities 201 227

88 Investing activities 189 (106)

Financing activities

(421) - Dividends paid by the Company (304) (280)

(5) - Dividends paid to minority shareholders (2) (2)

(426) (306) (282)

7 Others (2) (37)

368 Decrease/(Increase) in net debt 82 (198)

(3,025) Net debt at beginning of period (2,657) (3,025)

(2,657) Net debt at end of period (2,575) (3,223)


Consolidated Balance Sheet (US$m)

2014Full Year

2015Half-Year

2014Half-Year

Investment properties

23,697 - Subsidiaries 23,871 23,683

4,474 - Joint ventures 4,428 4,335

28,171 28,299 28,018

Properties held for sale

2,923 - Subsidiaries 3,017 3,195

1,372 - Joint ventures 1,247 1,250

4,295 4,264 4,445

(2,211) Others (2,263) (2,076)

30,255 Gross assets (excluding cash) 30,300 30,387

Financed by:

27,598 - Total equity 27,725 27,164

2,657 - Net debt 2,575 3,223

30,255 30,300 30,387


Investment Property – Basis of Valuation

Note: These capitalisation rates are provided on an indicative basis.

Capitalisation Rates 1H 2014 2H 2014 1H 2015

Hong Kong Office - Exchange Square 1 & 2 4.00% 4.00% 4.00%

Hong Kong Retail - Landmark Atrium 4.50% 4.50% 4.50%

Singapore Office - MBFC 3.80% 3.75% 3.75%


Investment Property – Carrying Values (US$m)

Note: The analysis includes share of Joint Ventures & Associates.

2014Full Year

2015Half-Year

2014Half-Year

Greater China

22,336 - Hong Kong 22,469 22,339

1,650 - Mainland China & Macau 1,712 1,467


3,628 - Singapore 3,546 3,665

557 - Others 572 547

28,171 Total 28,299 28,018


Properties Held for Sale – Carrying Values (US$m)

Note: The analysis includes share of Joint Ventures & Associates.

2014Full Year

2015Half-Year

2014Half-Year

Greater China

23 - Hong Kong 32 33

2,435 - Mainland China & Macau 2,269 2,299


1,696 - Singapore 1,817 1,987

141 - Others 146 126

4,295 4,264 4,445

(941) Pre-sale proceeds (1,039) (1,297)

3,354 Net investment 3,225 3,148


Gross Assets at 30th June 2015

Commercial 89%

Residential 11%

By Activity

Hong Kong 73%

Mainland China and Macau 11%

Southeast Asia 16%

By Location


Treasury Management

Summary 2013

Full Year2014

Full Year2015

Half-Year

Net debt (US$m) 3,025 2,657 2,575

Gearing 11% 10% 9%

Average tenor of debt (years) 6.7 7.3 7.0

Average interest cost 2.7% 2.9% 3.2%

Credit ratings

- S & P

- Moody’s

A-

A3

A

A3

A

A3


$278m

$750m $671m

$1,150m$882m

$3,260m

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2015 2016 2017 2018 2019 2020+

Bank Facilities (Drawn & Undrawn) BondsUS$m

Maturity Profile of Committed Facilities/Bonds (US$m)

*

* Includes bonds and notes issued under MTN Programme which are at face value.


Liquidity at 30th June 2015 (All figures in US$bn)

2014 HK$1

S$2

US$ RMB Total

7.2 Committed lines 4.7 1.8 - 0.5 7.0

4.3 Gross debt 3.1 1.0 - 0.2 4.3

2.9 Available lines 1.6 0.8 - 0.3 2.7

1.6 Cash - 0.1 0.9 0.7 1.7

4.5 Available liquidity 1.6 0.9 0.9 1.0 4.4

Notes: (1) HK$ debt includes US$ debt swapped into HK$.(2) S$ debt includes HK$ debt swapped into S$.


Outlook

• Strong performance from the commercial portfolio is expected to continue

• Contribution from residential business will be lower than last year due tofewer completions in Singapore and no sales in Hong Kong

• The Group continues to seek opportunities in premium commercial andresidential developments in Greater China and Southeast Asia

Hongkong Land

www.hkland.com

Thank you

2015 half-yearly results - hongkong landpalms @ sixth avenue jurong west street 41. 2015 half-yearly...

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