Hongkong Land Holdings (H78) H2 2024 earnings summary

Executive summary

• Strategic focus on ultra-premium integrated commercial properties in Asia's gateway cities, with no new investments in standalone build-to-sell assets and a new vision to 2035.

• Capital recycling accelerated, with $300m recycled in 2024, a target of up to $10bn over 10 years, and net debt reduced by $0.3bn.

• Organisational excellence initiatives include onboarding a new CEO and CIO, and implementing a long-term incentive plan from 2025.

• Member of Dow Jones Sustainability World Index, ranking in the top 6% globally, with top ESG ratings.

• Loss attributable to shareholders increased to $1,385m, mainly due to non-cash provisions and fair value losses.

Financial highlights

• Underlying profit (excluding China non-cash provisions) was $724m; reported underlying profit was $410m, down 44%.

• Revenue rose to $2,002m from $1,844m year-over-year.

• Net debt stood at $5.1bn, reduced from $5.4bn; NAV per share was $13.57, down 6%.

• Full-year dividend per share increased 6% to 23.0¢.

• Investment properties portfolio value declined by 5% to $24.8bn, mainly due to lower HK office rents.

Outlook and guidance

• 2025 underlying profits expected to partially recover but remain well below 2023 levels.

• HK office rental reversions expected to remain negative in 2025, with continued flight to quality.

• HK retail trading in 2025 to be impacted by Tomorrow's CENTRAL transformation, affecting up to 40% of leasable area.

• Singapore office performance expected to remain stable due to limited CBD supply.

• Macro-economic and geopolitical uncertainties expected to persist, challenging market conditions.