Hysan Development Co., Ltd. · HKEX:14
Hysan Development — FY2020 Earnings Presentation
25 slides from Hysan Development's earnings presentation, Feb 25, 2021
Slide 1: Hysan Development 2020 Annual Results Analyst Briefing
Hysan Development 2020 Annual Results Analyst Briefing 25 February 2021
Slide 2: Disclaimer
Disclaimer 25 February 2021 | Page 2 This document has been prepared for general information purposes only, and is not, and should not be construed as an offer to sell, or a solicitation of an offer to buy any securities. Information and estimates contained and opinions expressed herein have been co
Slide 3: Difficult 2020
Difficult 2020 25 February 2021 | Page 3 • 2020 was a most difficult year for Hong Kong and for the rest of the world • As we enter the second month of 2021, still little clarity on the future
Slide 4: New Normal
New Normal 25 February 2021 | Page 4 • We have seen signs of change as people’s habits and preferences evolve with generational shift: baby boomers, followed by Gen X, Y, Z • With rapid advancement and adoption of technology, adding shorter-term shocks of trade war, COVID-19 and social unrest just a
Slide 5: Hysan's Annual Results Highlights
2020 Hysan’s Annual Results Highlights 25 February, 2021 | Page 5 • Resilience and strength in the face of adversity • In 2020, Hysan’s Turnover and Recurring Underlying Profit decreased y-o-y by 7.0% and 7.3% respectively • Occupancies of Office and Retail portfolios were 95% and 96% respectively
Slide 6: Balance and Stability: Turnover Contribution
Balance and Stability 25 February 2021 | Page 6 • Hysan has premium collection of real estate Turnover Contribution concentrated in HK’s busiest and most iconic area Retail 1,600 Million • Balanced office and retail portfolio with diversified 43% Office group of tenants: balance and stability 1,814
Slide 7: Lee Gardens Community
Lee Gardens Community 25 February 2021 | Page 7 • Destination of choice • Visitors to form life-long and multi-generational habit of visiting Lee Gardens • Community curation is key • Technology: use IoT to understand what customers want • Increase use of digital and robotics services to improve eff
Slide 8: Structural Changes
Structural Changes 25 February 2021 | Page 8 • Notable structural changes leading to “new normal” in office and retail sectors in recent years...dynamic and changing • Office ❖ Flexibility ❖ Mobility ❖ Access to off-site work ❖ Work-life balance • Retail ❖ Consumers willing to pay for experience o D
Slide 9: What makes Hysan stand out
What makes Hysan stand out 25 February 2021 | Page 9 • New Normal → New Behaviour → New Economy • Community Model ❖ Organic ❖ Dynamic ❖ Constantly evolving ❖ Experience & fulfillment • Operational Expertise ❖ Sustainability ❖ Use of technology
Slide 10: Beyond Causeway Bay
Beyond Causeway Bay 25 February 2021 | Page 10 • Continue to invest, strengthen and grow our core in Causeway Bay • With a strong balance sheet and a unique Lee Gardens community model, we have the capacity to pursue opportunities outside of Hong Kong
Slide 11: 2021 Outlook
2021 Outlook 25 February 2021 | Page 11 • A great deal depends on COVID-19 coming under control globally • The world economy will continue to have ample liquidity, providing stimulus in a low interest rate environment • Governments will restart the economies, but the first step is to contain COVID-1
Slide 12: Annual Results Highlights
2020 Annual Results Highlights 25 February 2021 | Page 12 2020 2019 HK$'M HK$'M % Turnover 3,710 3,988 -7.0% Recurring Underlying Profit 2,398 2,587 -7.3% Underlying Profit 2,398 2,587 -7.3% - Fair value (loss) gain on investment properties located in ‧ Hong Kong (4,680) 690 ‧ Shanghai* (12) 1,528 -
Slide 13: Annual Performance: By Portfolio
2020 Annual Performance: By Portfolio 25 February 2021 | Page 13 Turnover (HK$’M) 4,500 3,988 4,000 319 (8%) 3,710 3,500 296 (8%) 3,000 1,833 (46%) 2,500 1,814 (49%) 2,000 1,500 1,000 1,836 (46%) 1,600 (43%) 500 0 2019 2020 Retail Office Residential
Slide 14: Strong Financial Position & Ample Liquidity
Strong Financial Position & Ample Liquidity 25 February 2021 | Page 14 Debt Maturity Profile as at 31 Dec 2020 Debt Profile Highlight (HKD’m) Gearing Ratio Average Debt Maturity 2,200 3,922 Net Cash 6.8 years 3,140 2,326 1,200 1,500 1,766 Fixed : Floating Effective Interest Rate 750 531 800 500 300
Slide 15: Indicative Cap Rates
Indicative Cap Rates 25 February 2021 | Page 15 31 Dec 2020 31 Dec 2019 Retail 5.25% - 5.50% 5% - 5.25% Office 4.25% - 5% 4.25% - 5% Residential 3.75% 3.75%
Slide 16: Performance: Office Portfolio
2020 Performance: Office Portfolio 25 February 2021 | Page 16 • Office portfolio turnover declined slightly by 1.0% to HK$1,814 million Office Portfolio Turnover (HK$’M) • Occupancy: 95% as at 31 December 2020 2,000 1,900 1,833 1,814 1,800 1,688 • COVID-19 adversely affected HK’s office rental 1,700
Slide 17: Annual Performance: Office Portfolio (con't)
2020 Annual Performance: Office Portfolio (con’t) 25 February 2021 | Page 17 • Balanced portfolio with different industries represented • Demand from “new economy": Lee Gardens a preferred location for new economy and personal services Office Portfolio Others 16.1% Banking & Finance Consumer Product
Slide 18: Performance: Retail Portfolio
2020 Performance: Retail Portfolio 25 February 2021 | Page 18 • Retail turnover was HK$1,600 million, down by 12.9% from 2019 Retail Portfolio Turnover (HK$’M) • Occupancy: 96% as at 31 December 2020 2,500 2,000 1,923 1,836 • Overall rental reversion in renewals, rent review 1,600 and new lettings w
Slide 19: Performance: Retail Portfolio (con't)
2020 Performance: Retail Portfolio (con’t) 25 February 2021 | Page 19 • Recurring waves of COVID-19 caused significant Hong Kong & Hysan Tenant Retail Sales distruption to HK’s retail sector (Jan-Dec 2020, YoY) • Those traditionally benefit from overseas and Type of retail outlet Hong Kong Hysan (es
Slide 20: Performance: Retail Portfolio (con't)
2020 Performance: Retail Portfolio (con’t) 25 February 2021 | Page 20 • Offered multi-faceted support from rental assistance to marketing collaboration with our tenants • Used digital technology to swiftly expand our online sales channel in response to the COVID disruptions • “Power Up” and other e-
Slide 21: Performance: Residential Portfolio
2020 Performance: Residential Portfolio 25 February 2021 | Page 21 • Residential portfolio turnover saw a decline of 7.2% to HK$296 million Residential Portfolio Turnover (HK$’M) • Overall rental reversion was flat 330 319 310 296 • Occupancy: 74% as at 31 December 2020 290 279 270 • High-end reside
Slide 22: Tai Po Luxury Residential Project
Tai Po Luxury Residential Project 25 February 2021 | Page 22 • Targeted completion date by the end of 2021 or early 2022 • Sales strategy being developed based on a sales launch by the end of 2021 or early 2022
Slide 23: Sustainability and Community
Sustainability and Community 25 February 2021 | Page 23 • Health, wellness and safety top priority during COVID-19 days • Hysan responded quickly with virus-prevention measures in place • Constantly upgrading hygienic and preventive means to avert possible outbreaks • Times challenging for community
Slide 24: Thank you
25 February 2021 | Page 24 Thank you
Slide 25: Hysan Development 2020 Annual Results Analyst Briefing
Hysan Development 2020 Annual Results Analyst Briefing 25 February 2021
Hysan Development Company — FY2020 Earnings Presentation on 6ix