Swire Pacific Limited Class A · HKEX:19
Swire Pacific Limited Class A — Swire Pacific Ltd A — FY2023 Earnings Presentation
37 slides from Swire Pacific Limited Class A's earnings presentation, Mar 14, 2024
Slide 1: 2023 Annual Results Analyst Briefing
I SWIRE PACIFIC 2023 ANNUAL RESULTS ANALYST BRIEFING 14th March 2024 | Hong Kong
Slide 2: Disclaimer
D IS C L A IM E R 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
Slide 3: Agenda
AGENDA ‣ F INANCIAL HIG HLIG HTS AND G RO UP CO RPO RATE STRATEG Y ‣ 2023 F INANCIAL PERF O RMANCE ‣ BUSINESS REVIEW ‣ SUSTAINABILITY UPDATE ‣ OUTLOOK ‣ Q&A 3
Slide 4: Financial Highlights and Group Corporate Strategy
F IN A N C I A L H I G H L I G H T S A N D GROUP CORPORATE STRATEGY G UY B R AD L E Y , C HAI R MA N
Slide 5: Swire Pacific – Highlights
SWIRE PACIFIC – HIGHLIGHTS ‣ Record underlying profit of HK$36.2Bn. ‣ Includes HK$22.9Bn gain from sale of Swire Coca-Cola, USA and from the agreements to sell 12 floors at One Island East (sale of 9 floors with attributable underlying disposal gain of HK$2.7Bn recognised in 2023). ‣ Remain committe
Slide 6: 2023 Highlights – Substantial Increase in Recurring Underlying Profit
2023 HIGHLIGHTS – SUBSTANTIAL INCREASE IN RECURRING UNDERLYING PROFIT Ordinary Dividend per ‘A’ Share 7% Recurring Underlying Profit 175% 2022: HK$3.00 HK$3.20 2022: HK$3.8Bn HK$10.4Bn Special Dividend per ‘A’ Share HK$8.12 Recurring Underlying Profit 2023: HK$5.9Bn 2023: HK$2.4Bn(1) 2023: HK$3.5Bn
Slide 7: 2023 Performance
2023 PERFORMANCE ‣ Recurring underlying profit of HK$10.4Bn. ‣ Significant turnaround from Aviation Division, driven by post-COVID travel demand and operational improvements. ‣ Our core businesses remained solid despite the difficult economic environment and ongoing geopolitical tensions. ‣ Focus on
Slide 8: 2023 Financial Performance
2 0 2 3 F IN A N C I A L P E R F O R M A N C E MAR TI N MUR R AY , F I NANC E D I R E C TOR
Slide 9: 2023 Financial Summary
2023 FINANCIAL SUMMARY Statutory Profit Underlying Profit Recurring Underlying Profit 2022: HK$4,195m 2022: HK$4,748m 2022: HK$3,800m 2023: HK$28,853m 588% 2023: HK$36,177m 662% 2023: HK$10,449m 175% Equity Attributable to the Ordinary Dividends Revenue per Share Company’s Shareholders 2022: HK$91,6
Slide 10: 2023 Financial Summary – Profit/(Loss) by Division
2023 FINANCIAL SUMMARY – PROFIT/(LOSS) BY DIVISION Recurring underlying profit/(loss) Underlying profit/(loss) 2023 2022 2023 2022 Gains from the One Island HK$M HK$M HK$M HK$M East transaction and the sale of Taikoo Shing Property 5,942 5,844 9,455 7,099 carparks Beverages 2,394 2,392 25,097 2,392
Slide 11: 2023 Financial Summary – Reconciliation of Profits
2023 FINANCIAL SUMMARY – RECONCILIATION OF PROFITS 2023 2022 HK$M HK$M Statutory profit 28,853 4,195 Adjustments in respect of investment properties 7,324 553 Gains from the One Underlying profit attributable to the company’s shareholders 36,177 4,748 Island East transaction and the sale of Taikoo S
Slide 12: 2023 Substantial Increase in Underlying Profit
2023 SUBSTANTIAL INCREASE IN UNDERLYING PROFIT HK$M Higher gain on disposal of 40,000 investment properties, partly offset by higher provisions and impairments 36,177 1,005 35,000 868 Deemed disposal gain of 30,000 Air China 25,000 Higher retail rental income Full year contribution from Significant
Slide 13: 2023 Financial Summary – Robust Financial Position
2023 FINANCIAL SUMMARY – ROBUST FINANCIAL POSITION Net Debt Movements (HK$Bn) Gearing Ratio Net debt at 1st January 2023 56.8 HK$M % 400,000 30.0 Cash from operations (14.5) 25.0 Disposal proceeds (36.1) 300,000 19.5 18.5 15.8 20.0 Capex and investments 23.1 13.8 13.6 200,000 18.0 15.0 Net dividends
Slide 14: 2023 Financial Summary – Healthy Liquidity
2023 FINANCIAL SUMMARY – HEALTHY LIQUIDITY December December December December Change % 2020 2021 2022 2023 (December 23 vs HK$M HK$M HK$M HK$M December 22) Bank balances and short-term deposits 29,264 22,894 11,614 14,082 +21% Total undrawn facilities - Committed 32,971 24,219 21,510 34,850 +62% Gr
Slide 15: Business Review
B U S IN E S S R E V IE W GUY B R AD L E Y , C HAI R MA N K AR E N S O, MANAGI N G D I R E C TOR , S W I R E C OC A - C OL A MAR TI N MUR R AY , F I NANC E D I R E C TOR
Slide 16: Property – 2023 Overview
PROPERTY – 2023 OVERVIEW ‣ Recurring underlying profit of HK$7,246m, compared with HK$7,127m in 2022 Reflecting higher retail rental income from Hong Kong and the Chinese Mainland, partly offset by lower office rental income from Hong Kong. ‣ Making good headway in all strategic areas Q1 2023 Q3 202
Slide 17: Property – 2023 Overview
PROPERTY – 2023 OVERVIEW Underlying Profit (100% Basis) Movement in Underlying Profit (100% Basis) HK$M HK$M Total Total +33% 13,000 $11,531 12,000 $8,657 2,755 10 11,531 12,000 11,000 11,000 10,000 4,285 9,000 10,000 8,000 1,530 7,000 6,000 9,000 8,657 116 (248) 241 5,000 +2% 4,000 7,127 7,246 8,00
Slide 18: Property – Chinese Mainland Portfolio
PROPERTY – CHINESE MAINLAND PORTFOLIO ‣ Increasing contribution to revenue. ‣ Chinese Mainland portfolio contributed 40% attributable gross rental income in 2023. (1) ‣ Chinese Mainland retail is the second largest rental contributor. ‣ Chinese Mainland retail is further increased after 100% ownersh
Slide 19: Property – Investing in Long-Term Growth
PROPERTY – INVESTING IN LONG-TERM GROWTH Significant progress achieved in the HK$100 Billion Investment Plan Chinese Mainland ▪ Taikoo Li Xi’an ▪ Taikoo Li Sanya (1) ▪ Increased stake at Taikoo Li Chengdu (2) ▪ New Bund Mixed-use Project, Shanghai HK$ 37 Bn > HK$ 50 Bn Chinese Mainland ▪ Yangjing Mi
Slide 20: Property – Upcoming Projects
PROPERTY – UPCOMING PROJECTS (1) Strong and diverse pipelines 12.1 M sq ft Expected Attributable GFA Expected to be Completed (1) completion year 2024 2025 2026 2027 onwards ▪ Six Pacific Place (2) ▪ Residential project ▪ Residential project ▪ Residential and office HK ▪ LA MONTAGNE (3) in Chai Wan
Slide 21: Swire Coca-Cola – 2023 Overview
SWIRE COCA-COLA – 2023 OVERVIEW CHINESE MAINLAND SOUTH EAST ASIA USA ► Acquisition of 100% equity interest in six ► The total franchise population of SCC ► Sale of SCCU was completed on 7th subsidiaries of CCBMH was completed, territories reached 847 million following September 2023, recording a con
Slide 22: Swire Coca-Cola – Acquisition of Franchise Businesses in Thailand and Laos
SWIRE COCA-COLA – ACQUISITION OF FRANCHISE BUSINESSES IN THAILAND AND LAOS ► SCC conditionally agreed to acquire a majority stake in ThaiNamthip Corporation Ltd. for an aggregate consideration of approximately HK$9.5Bn on 9th February 2024. ► ThaiNamthip’s franchise territory covers approximately 90
Slide 23: Swire Coca-Cola – 2023 Overview
SWIRE COCA-COLA – 2023 OVERVIEW EBITDA increased by 1% to HK$6,084m Chinese Mainland – EBITDA , excluding non-recurring item, HK$6.1Bn decreased by 4% due to higher operating expenses and unfavourable EBITDA exchange rate movements. Hong Kong – EBITDA increased by 6%. Revenue and volume increased as
Slide 24: Swire Coca-Cola – Geographic Diversity
SWIRE COCA-COLA – GEOGRAPHIC DIVERSITY Recurring Attributable Profit 2023 Category Mix 2023 Revenue Source HK$M 66% Total Total 50% 3,000 4% $2,392 $2,394 4% 2,500 198 2,000 1,392 1,313 11% 1,500 8% 33% 138 3% 7% 9% 5% 1,000 191 123 Chinese Mainland Hong Kong 194 Sparkling Juice Energy drinks Taiwan
Slide 25: Swire Coca-Cola – Steady Business in 2023
SWIRE COCA-COLA – STEADY BUSINESS IN 2023 Revenue decreased by 5% but volume increased by 6%. EBITDA margin increased to 11.7% from 11.0% in 2022. Revenue by Region EBITDA Margin by Region HK$M -8% 30,000 +0% 20% 16.5% 16.8% 25,000 % growth in HK dollar terms 15% 13.8% % growth in local currency ter
Slide 26: Aviation – 2023 Overview
AVIATION – 2023 OVERVIEW Significant improvement from Cathay group at airline level, partially offset by losses from associates Attributable Profit/(Loss) Key Financial Data HK$M Total Total HK$M 2023 2022 Change % $(3,072) $3,393 6,000 45 HAECO group 5,000 5 4,000 Revenue 17,787 13,828 +29% 3,000 5
Slide 27: Cathay Pacific – 2023 Overview
CATHAY PACIFIC – 2023 OVERVIEW Profitable full year for the first time since 2019 Continue to rebuild the financials Group attributable profit/(loss) Liquidity (HK$Bn) (HK$Bn) (21.6) (5.5) (6.6) 9.8 30.3 28.6 27.2 20.0 20.0 9.2 (0.3) (2.8) (14.0) Dec 2019 Dec 2020 Dec 2021 Dec 2022 Dec 2023 ► Prefer
Slide 28: Cathay Pacific – 2023 Overview
CATHAY PACIFIC – 2023 OVERVIEW MOVEMENT IN UNDERLYING PROFIT (100% BASIS) Travel ► Cathay Pacific has made good progress with its rebuild journey and remains focused on rebuilding in a measured and responsible manner. ► Anticipate to reach 80% of its pre-pandemic passenger flights within the second
Slide 29: HAECO – 2023 Overview
HAECO – 2023 OVERVIEW ‣ Recurring attributable profit increased, primarily benefitting from higher activity in base maintenance, line maintenance and engine overhauls, partially offset by a higher operating loss incurred in the cabin solutions business and unrealised foreign exchange losses at HAECO
Slide 30: Healthcare – 2023 Overview
HEALTHCARE – 2023 OVERVIEW MOVEMENT IN UNDERLYING PROFIT (100% BASIS) CHINESE MAINLAND INDONESIA DELTAHEALTH IHC • First control acquisition in healthcare • First healthcare venture in South East Asia • In line with our strategy to be a majority owner • Strategic partnership with Indonesia Healthcar
Slide 31: Healthcare – 2023 Overview
HEALTHCARE – 2023 OVERVIEW Continued growth in volume and revenue across healthcare assets in the Chinese Mainland and Hong Kong Revenue YoY Growth FY2023 1,500+ 5 5 5 68% Registered beds Hospitals Senior living facilities Clinics Number of Outpatients Number of Inpatients c.25k c.400k +69% +115% ‣
Slide 32: Sustainability Update
SUSTAINABILITY UPDATE TARGETS PROGRESS(4) 50% reduction in greenhouse gas emissions (1) by 2030, ‣ Climate: We remain on track to meet our 2030 target, having reduced our emissions by and Net-Zero by 2050 30% against our 2018 baseline. We achieved a CDP Climate score of A-. 65% waste diversion from
Slide 33: Outlook
OUTLOOK ‣ Continue to focus on strengthening our businesses through our long-term strategy of investing in our core markets. ‣ Continue to invest in the Chinese Mainland and Hong Kong for Swire Properties and exciting expansions in South East Asia for Swire Coca-Cola and the healthcare business. ‣ R
Slide 34: Q&A
Q&A 1 4 TH M A RCH 2 0 2 4 | HONG KONG
Slide 35: 2023 Annual Results Analyst Briefing
I SWIRE PACIFIC 2023 ANNUAL RESULTS ANALYST BRIEFING 14th March 2024 | Hong Kong
Slide 36: Appendix
APPENDIX 1 4 TH M A RCH 2 0 2 4 | HONG KONG
Slide 37: 2023 Financial Summary – Return on Equity
2023 FINANCIAL SUMMARY – RETURN ON EQUITY 5-year 2023 average Return on Equity 11.0% 2.6% 15% Derived from: Recurring underlying profit 4.0% 1.9% Net non-recurring items 9.8% 1.4% Net property valuation adjustments -2.8% -0.7% 10% Property Disposal HK$Bn Recurring Disposal Gain/ Dividends and Return