Lai Sun Development Company (488) H1 2025 earnings summary

Executive summary

• Net loss attributable to owners narrowed to HK$117.8 million from HK$1,853.0 million year-over-year, driven by improved fair value changes in investment properties, better joint venture contributions, a gain on subsidiary disposal, and reduced finance costs.

• Turnover declined 16.2% year-over-year to HK$2,547.6 million, mainly due to lower property sales as Zhongshan Palm Spring neared completion, partially offset by higher sales in Hong Kong projects.

• Adjusted EBITDA (excluding fair value changes and non-recurring items) was HK$494.4 million, down 4.9% year-over-year.

• Rental income remained resilient at HK$621.0 million with high occupancy rates in Hong Kong and Mainland China.

• Hotel operations revenue rose 3.9% to HK$647.3 million, led by Caravelle Hotel performance.

Financial highlights

• Gross profit was HK$942.7 million, down from HK$1,071.6 million year-over-year.

• Recognised property sales fell 33.2% to HK$617.2 million.

• Restaurant and F&B sales dropped 23.8% to HK$217.8 million; cinema operation revenue increased 16.6% to HK$220.2 million.

• Media and entertainment revenue decreased 42.3% to HK$103.4 million; film and TV program revenue dropped 74.6% to HK$31.8 million.

• Net loss per share improved to HK$0.081 from HK$1.275 year-over-year.

Outlook and guidance

• The group remains cautious amid global economic uncertainties, focusing on cost control and cash recoupment.

• Asset disposals of HK$8,000 million planned over two years, including HK$2,000 million at Lai Fung Group, to strengthen financial position.

• Ongoing discussions and commitments for major refinancing projects to secure liquidity.

• Hong Kong office and retail leasing expected to remain competitive short-term, but medium- to long-term outlook is stabilizing.

• Anticipates growth from Hengqin Novotown Phase II, with new accommodation and office towers under construction.