Swire Pacific Limited Class A · HKEX:19
Swire Pacific Limited Class A — Swire Pacific Ltd A — FY2022 Earnings Presentation
42 slides from Swire Pacific Limited Class A's earnings presentation, Mar 9, 2023
Slide 1: 2022 Annual Results Analyst Briefing
2022 ANNUAL RESULTS ANALYST BRIEFING 9TH MARCH 2023 | HONG KONG
Slide 2: Disclaimer
DISCLAIMER This document has been prepared by Swire Pacific Limited (the “Company”, and together with its subsidiaries, the “Group”) solely for information purposes and information in it has not been independently verified. No representation or warranty, express or implied, is made as to, and no rel
Slide 3: Agenda
AGENDA ► FINANCIAL HIGHLIGHTS AND GROUP CORPORATE STRATEGY ► 2022 FINANCIAL PERFORMANCE ► BUSINESS REVIEW ► SUSTAINABILITY AND ESG UPDATE ► OUTLOOK ► Q&A
Slide 4: Financial Highlights and Group Corporate Strategy
FINANCIAL HIGHLIGHTS AND GROUP CORPORATE STRATEGY GUY BRADLEY, CHAIRMAN
Slide 5: Swire Pacific 2022 Performance
SWIRE PACIFIC 2022 PERFORMANCE ‣ Exciting expansion for Swire Properties and Swire Coca-Cola. ‣ Recovery of Aviation with the cessation of COVID-19 related measures. ‣ Commenced share buy-back programme and 15% dividend growth. PROPERTY BEVERAGES AVIATION ‣ Implementing the HK$100Bn investment ‣ Acq
Slide 6: 2022 Highlights
2022 HIGHLIGHTS Recurring underlying profit (excluding CX) Dividend per ‘A’ Share 2021: HK$7.1Bn HK$7.0Bn Recurring underlying profit (excluding CX) 2021: HK$2.60 HK$3.00 per ‘A’ share ] 2021: HK$4.75 HK$4.70 15% Share Buy-back Up to HK$4.0Bn 39,383,000 ‘A’ shares Total consideration programme 44,42
Slide 7: Business Performance Resilient Despite COVID-19, Inflation and Uncertainty
BUSINESS PERFORMANCE RESILIENT DESPITE THE CHALLENGES OF COVID-19, INFLATION AND ECONOMIC UNCERTAINTY Recurring Underlying Profit PROPERTY BEVERAGES AVIATION 2022: HK$(3.0)Bn 2021: HK$(1.9)Bn 62% HAECO HAECO CX and sub CX and 2022: HK$2.4Bn subsidiaries 2022: HK$5.8Bn 2021: HK$2.5Bn 2021: HK$5.8Bn C
Slide 8: 2022 Financial Performance
2022 FINANCIAL PERFORMANCE MARTIN MURRAY, FINANCE DIRECTOR
Slide 9: Financial Summary
2022 FINANCIAL SUMMARY Recurring Underlying Profit Underlying Profit Statutory Profit 2021: HK$4,878m 2021: HK$5,293m 2021: HK$3,357m 2022: HK$3,800m 2022: HK$4,748m 2022: HK$4,195m Revenue Equity Attributable to Dividends per Share 2021: HK$92,830m the Company’s Shareholders 2021: -1% 2021: HK$266,
Slide 10: Financial Summary – Profit/(Loss) by Division
2022 FINANCIAL SUMMARY – PROFIT/(LOSS) BY DIVISION RECURRING UNDERLYING UNDERLYING PROFIT/(LOSS) PROFIT/(LOSS) 2022 2021 2022 2021 HK$M HK$M HK$M HK$M PROPERTY 7,099 7,776 5,844 5,817 BEVERAGES 2,392 2,549 2,392 2,549 AVIATION - CATHAY PACIFIC GROUP (1) (3,228) (2,757) (3,228) (2,250) - HAECO GROUP
Slide 11: Financial Summary – Reconciliation of Profits
2022 FINANCIAL SUMMARY – RECONCILIATION OF PROFITS 2022 2021 HK$M HK$M STATUTORY PROFIT 4,195 3,357 Adjustments in respect of investment properties 553 1,936 UNDERLYING PROFIT ATTRIBUTABLE TO THE 4,748 5,293 COMPANY’S SHAREHOLDERS Significant non-recurring items: Lower gain from Gain on disposals of
Slide 12: Decrease in Underlying Profit
2022 DECREASE IN UNDERLYING PROFIT HK$M Net disposal gain of SPO and absence of Cathay 5,500 Pacific impairments, partly 5,293 27 (157) offset by impairment of goodwill and assets mainly (1,155) at the food business and lower gain on disposal of 5,000 investment properties Increase in trading profit
Slide 13: Financial Summary – Strong Financial Position
2022 FINANCIAL SUMMARY – STRONG FINANCIAL POSITION Net Debt Movements (HK$Bn) Gearing Ratio Net debt at 1st January 2022 38.7 HK$M % Cash from operations (12.0) 400,000 25 Disposal proceeds (4.2) 350,000 19.3 19.5 20 300,000 15.8 Capex and investments 21.4 250,000 13.8 13.6 18.0 15 200,000 Net divid
Slide 14: Financial Summary – Healthy Liquidity
2022 FINANCIAL SUMMARY – HEALTHY LIQUIDITY DEC 2019 DEC 2020 DEC 2021 DEC 2022 CHANGE % HK$M HK$M HK$M HK$M (DEC 22 VS DEC 21) Bank balances and short-term deposits 21,345 29,264 22,894 11,614 -49% Total undrawn facilities - Committed 18,686 32,971 24,219 21,510 -11% Group committed liquidity 40,031
Slide 15: Business Review
BUSINESS REVIEW GUY BRADLEY, CHAIRMAN
Slide 16: Property
PROPERTY 16
Slide 17: Property Overview
2022 OVERVIEW Robust performance amid challenging market Recurring underlying profit of HK$7,127m, compared with HK$7,094m in 2021 Significant progress in all strategic areas Mar 2022 Taikoo Li Xi’an (70% owned) acquired a site in Small Wild Goose Pagoda historical and cultural zone Zung Fu Industri
Slide 18: Property Overview – Underlying Profit
2022 OVERVIEW UNDERLYING PROFIT (100% BASIS) MOVEMENT IN UNDERLYING PROFIT (100% BASIS) HK$M HK$M Total 10,000 $9,483 Total -9% 10,000 9,000 $8,657 9,483 (73) 153 (47) (859) 8,000 2,389 1,530 7,000 9,000 8,657 6,000 5,000 4,000 8,000 7,094 7,127 3,000 +0.5% 2,000 1,000 7,000 2021 Decrease in Increas
Slide 19: Chinese Mainland Portfolio
CHINESE MAINLAND PORTFOLIO ‣ A major contributor to revenue growth. ATTRIBUTABLE GROSS RENTAL INCOME ‣ Chinese Mainland overall portfolio contributed 37% of attributable gross BY REGION(1) rental income in 2022.(1) ‣ Chinese Mainland retail is the second largest rental contributor. Contribution from
Slide 20: Investing in Long-Term Growth
INVESTING IN LONG-TERM GROWTH Close to 40% of HK$100Bn investment plan committed Taikoo Li Xi’an Sanya Retail Project 50 Chinese Mainland Increased stake in Sino-Ocean Taikoo Chinese > HK$ Bn Mainland Li Chengdu HK$ 17 Bn HK$ 100 Bn 30 Increased stake in Citygate 100% ownership at Zung Fu
Slide 21: Upcoming Projects
UPCOMING PROJECTS 8.2 M sq ft Expected Attri. GFA to Strong pipelines driving sustainable growth be completed from 2023 2023 2024 2025 2026 onwards Attri. GFA sq ft (6) HK Six Pacific Place Residential project in Wong Chuk Hang (1) Residential projects in Chai Wan and Residential and office
Slide 22: Beverages
BEVERAGES 22
Slide 23: Investing for Growth
INVESTING FOR GROWTH CHINESE MAINLAND CAMBODIA VIETNAM ► 16% increase in franchise population to 882 million in Swire franchise ► Restructuring of non-sparkling territories (including Vietnam). beverage production facilities. ► Leverage on proven strengths in commercial capabilities, marketing, supp
Slide 24: Beverages Overview
2022 OVERVIEW Second highest profits despite cost pressure and COVID-19 lockdowns in the Chinese Mainland HK$2.4Bn USA profit increased by 41%. Revenue increased reflecting Recurring price increases and an improved product mix. profit Chinese Mainland profit decreased by 36%. Sales and operations we
Slide 25: Geographic Diversity
GEOGRAPHIC DIVERSITY ATTRIBUTABLE PROFIT 2022 CATEGORY 2022 REVENUE(1) Total HK$M Total $2,549 2,800 $2,392 67% 51% 136 4% 138 2,400 213 4% 191 2,000 10% 902 1,418 7% 8% 41% 1,600 3%5% 1,200 Sparkling Juice Energy drinks Chinese Mainland Hong Kong Water Tea Other still Taiwan USA 800 1,392 989 KEY F
Slide 26: Adverse Effect of COVID-19
ADVERSE EFFECT OF COVID-19 Revenue increased by 4% and volume decreased by 3%. EBITDA margin decreased to 11.0% from 11.6% in 2021. HK$M -3% REVENUE BY REGION EBITDA MARGIN BY REGION 30,000 -2% % growth in HK dollar terms 18% % growth in local currency terms 16.5% 16% 15.2% 25,000 +14% +14% 14% 12
Slide 27: Aviation
AVIATION
Slide 28: Aviation Overview
2022 OVERVIEW KEY FINANCIAL DATA ATTRIBUTABLE PROFIT/(LOSS) MOVEMENT HK$M IN UNDERLYING PROFIT (100% 2022 BASIS)2021 Change % Total HAECO group HK$M Total $(3,072) 1,000 $(2,380) Revenue 13,828 11,464 +21% 185 394 657 Attributable profit 185 394 -53% 0 (778) (772) Recurring profit 250 416 -40% (1,00
Slide 29: Hong Kong's Aviation Environment
HONG KONG’S AVIATION ENVIRONMENT Hong Kong international aviation hub at a turning point MOVEMENT IN UNDERLYING PROFIT (100% BASIS) Hong Kong’s aviation Passenger Heavily affected by market was performing volumes affected COVID-19 8,000 strongly before the by HK social summer of 2019 unrest from Mon
Slide 30: Overview – Cathay Pacific
2022 OVERVIEW – CATHAY PACIFIC Attributable (loss)/profit Average monthly cash burn Liquidity (HK$Bn) (HK$Bn) (HK$Bn) 2.1 +1.1 30.3 +0.2 28.6 27.2 <0.1 (5.0) (1.5) 0.9 (7.6) 1.8 (9.9) (11.8) 2.9 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 2020 2020 2021 2021 2022 2022 2020 2020 2021 2021 2022 2022 Dec 2020
Slide 31: Overview – Cathay Pacific
2022 OVERVIEW – CATHAY PACIFIC Continuous effort to meet the capacity rebuild target Travel ► CX has sufficient pilots and cabin crew to support its current schedule. There are ongoing recruitment plans to ensure this remains the case throughout the rebuild of CX. ► Passenger flight capacity will be
Slide 32: Overview – HAECO
2022 OVERVIEW – HAECO HAECO profit decreased due to the absence of financial assistance provided by the US government. Profit increased disregarding the non-recurring government subsidy, reflecting principally a recovery in demand for engine overhaul. Line maintenance in Hong Kong remained weak. KEY
Slide 33: Healthcare
HEALTHCARE
Slide 34: Healthcare
HEALTHCARE Adversely affected by COVID-19 restrictions in the Chinese Mainland Columbia China Healthcare DeltaHealth Shenzhen New Frontier United Family Hospital and HEAL Medical Group ‣ Opening of Suzhou and Shanghai ‣ Increased patient volumes following the ‣ Shenzhen New Frontier United Family Ba
Slide 35: Sustainability and ESG Update
SUSTAINABILITY AND ESG UPDATE GUY BRADLEY, CHAIRMAN
Slide 36: Sustainability and ESG Update
SUSTAINABILITY AND ESG UPDATE 2022 HIGHLIGHTS TARGETS PROGRESS in 2022 • Sustainable finance represented more than 50% reduction in GHG emissions (1) by 2030, 19% reduction in GHG emissions compared with 35% of total Group financing and Net-Zero by 2050 2018 baseline • SD Fund allocated HK$21 millio
Slide 37: Outlook
OUTLOOK GUY BRADLEY, CHAIRMAN
Slide 38: Outlook
OUTLOOK ‣ Achieving strategic objectives of growing our core businesses and improving returns to shareholders remains our prime focus. ‣ The opening of the border between Hong Kong and the Chinese Mainland should have a significant positive impact to our businesses, particularly on our aviation busi
Slide 39: Q&A
Q&A 9TH MARCH 2023 | HONG KONG DI SwirE PACIFIC
Slide 40: Appendix
APPENDIX 9TH MARCH 2023 | HONG KONG
Slide 41: Financial Summary – Return on Equity
2022 FINANCIAL SUMMARY – RETURN ON EQUITY 5-year 2022 average Return on Equity Return on Equity 1.6% 2.2% Derived from: 11% Recurring underlying profit 1.4% 1.7% Net non-recurring items 0.4% -0.5% 9% Net property valuation adjustments -0.2% 1.0% 7% Property Disposal Recurring Disposal Gain/ and Valu
Slide 42: Annual Results Analyst Briefing
2022 ANNUAL RESULTS ANALYST BRIEFING 9TH MARCH 2023 | HONG KONG