Far East Consortium International Limited · HKEX:35
Far East Consortium International — 1H FY2024 Earnings Presentation
52 slides from Far East Consortium International's earnings presentation, November 2023
Slide 1: 2023/2024 Interim Results
2023/2024 Interim Results November 2023
Slide 2: Disclaimer
Disclaimer This document has been prepared by Far East Consortium International Limited (the “Company”) solely for information purposes. This document does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to purchase or subscrib
Slide 3: Table of Contents
Table of Contents 1. FY2024 Interim Results Summary 2. Review of Operations 3. Prospects 4. Appendices 3
Slide 4: 1. FY2024 Interim Results Summary
1. FY2024 Interim Results Summary Ritz-Carlton Melbourne 4
Slide 5: Key Theme of 1H FY2024
Key Theme of 1H FY2024 Business Segments Remains Resilient Despite Challenging Macro Environment • Revenue reached HK$6.3 bn and adjusted cash profit was HK$507 mn • Property development: Revenue for property development was HK$4.7 bn. Benefitted from settlements of West Side Place and booking of re
Slide 6: Key Theme of 1H FY2024 (cont’d)
Key Theme of 1H FY2024 (cont’d) Implementing Initiatives to Lower Gearing and Interests • Many large projects reaching completion and settlement stage (Presales and unbooked contracted sales reached HK$14.1 bn) • Significant settlement in West Side Place (Towers 3 and 4) in Melbourne • Accelerate th
Slide 7: Top Line Growth but Profitability Affected by Several Factors
Top Line Growth but Profitability Affected by Several Factors • Listing expenses of Palasino Group of HK$14 mn in 1H FY2024 • Compensation income of HK$475 mn in 1H FY2023 was not repeated this period • Interest rate rises, and higher selling and marketing expenses which mainly arising from completi
Slide 8: Healthy Property Development Pipeline in the Coming Years
Healthy Property Development Pipeline in the Coming Years • Over HK$60 bn of pipeline • Cumulative attributable presales and unbooked contracted sales at HK$14.1 bn as at 30 September 2023 Expected Completion Year FY2024 FY2025 FY2026/FY2027 • Inventory Sales • Kai Tak Development - Office • Kai Tak
Slide 9: Margins Largely Intact Although Hotel Margin Affected
Margins Largely Intact Although Hotel Margin Affected by a Change in Revenue Structure in Hong Kong and Ramp Up of New Hotels 1H FY2024 1H FY2023 Gross profit Gross profit Gross profit Gross profit Revenue Revenue (after depreciation) (before depreciation) (after depreciation) (before depreciation)
Slide 10: Impact of Foreign Exchange Rates
Impact of Foreign Exchange Rates • Movement in foreign currencies impacted balance sheet position • Assuming exchange rates remained constant, net asset value(1), would have been HK$810 million higher as at 30 September 2023 Average rates Rates as at 30.9.2023 31.3.2023 % change 1H FY2024 1H FY2023
Slide 11: Managing our Balance Sheet
Managing our Balance Sheet • Net debt reduced by HK1.4 bn. Short term debt reduced by HK$6.3 bn • Disposals of non-core assets and presales moving to completion will strengthen liquidity and balance sheet position • Making efforts to reduce gearing as interest rates remain elevated HK$ mn As at 30.9
Slide 12: Initiatives to Reduce Debt Level and Finance Costs
Initiatives to Reduce Debt Level and Finance Costs • Monetise assets and reduce debt by a further HK$4.6-5.6 bn, as committed at FY2023 result announcement • Successfully reduced debt level by HK$3.4 bn in 1H FY2024, net debt reduced by HK$1.4bn Focusing on Monetising Existing Completed Inventory
Slide 13: Short Term Debts Analysis and Liquidity Management
Short Term Debts Analysis and Liquidity Management • Short term debt reduced / rolled over to longer maturity • Aim to reduce debt level in coming months amidst rising interest rate • Completion of major projects and disposal of non-core assets will reduce debt level As at As at Bank loans and notes
Slide 14: Good Access to Liquidity
Good Access to Liquidity • Available existing liquidity of approximately HK$11 bn (cash position and undrawn facilities) far exceeds the capex of HK$1.3 bn • Presales and unbooked contracted sales of approximately HK$14.1 bn provides visibility on future cash inflow streams • Unencumbered hotels and
Slide 15: 2. Review of Operations: Property Development
2. Review of Operations Property Development New Cross Central, Manchester 15
Slide 16: Healthy Pipeline and Contracted Presales Offers Good Cash Flow Visibility
Healthy Pipeline and Contracted Presales Offers Good Cash Flow Visibility • HK$14.1 bn of cumulative presales and unbooked contracted sales over HK$60 bn of saleable residential inventory As at 30.09.2023 Location Cumulative presales Expected attr. SFA (1) Expected attr. GDV(2) Expected Cumulative p
Slide 17: Upcoming Launch – Kai Tak Office, Hong Kong
Upcoming Launch – Kai Tak Office, Hong Kong The HK Government’s most significant infrastructure investment in recent decades Landmark development in the new Kai Tak Sports Park Precinct in Hong Kong. Pre-sold to CLP for HK$3.38 bn. Over HK$2.7 bn receivable upon completion. Executive summary Located
Slide 18: Upcoming Launch in FY2025 – Kai Tak Residential, Hong Kong
Upcoming Launch in FY2025 – Kai Tak Residential, Hong Kong Significant New Development Along the Waterfront The development is at the heart of the Hong Kong government’s redevelopment plans, providing residents with access to upgraded infrastructure. Its location offers a tranquil sea view for rest
Slide 19: Recent Completion – West Side Place (Towers 3 and 4), Melbourne
Recent Completion – West Side Place (Towers 3 and 4), Melbourne A New Height of Cosmopolitan Living These two towers make up Stage 2 of West Side Place, a major mixed-use development located next to our existing Upper West Side development. It is proudly positioned in Melbourne’s CBD grid and in imm
Slide 20: Upcoming Completion in FY2025 – The Star Residences (Tower 2)
Upcoming Completion in FY2025 – The Star Residences (Tower 2), Gold Coast Live in the Heart of Gold Coast’s World-Class Integrated Resort Located at The Star Gold Coast on Broadbeach Island, Tower 2 is one of 5 total towers in this mixed-use development. The site is adjacent to Pacific Fair Shopping
Slide 21: Upcoming Completion in FY2025 – Perth Hub, Perth
Upcoming Completion in FY2025 – Perth Hub, Perth Embrace the Epitome of Connected, Distinctive, and Exciting Urban Living Create an inner-city home in a vibrant destination that links exclusive apartment living with entertainment, restaurants, bars, cafes, shops, art, culture, recreation, education
Slide 22: Upcoming Completion in FY2025 – Queen’s Wharf Residences (Tower 4)
Upcoming Completion in FY2025 – Queen’s Wharf Residences (Tower 4), Brisbane A Landmark that Further Reinforces Brisbane’s status as a Truly Global City It is located in the heart of Brisbane's CBD and is part of the wider Queen's Wharf precinct, which is set to become a major entertainment and leis
Slide 23: Upcoming Completion in FY2029 – Queen’s Wharf Residences (Tower 5)
Upcoming Completion in FY2029 – Queen’s Wharf Residences (Tower 5), Brisbane Unique Residential Living with Exceptional Private Amenity Tallest tower within the Queen’s Wharf Brisbane development and is across the street from the Tower 4. Mixing luxury retail, dining, entertainment and accommodation
Slide 24: Upcoming Completion in FY2025 - Aspen at Consort Place, London
Upcoming Completion in FY2025 - Aspen at Consort Place, London An Artistic Building Rooted in History Located in the Canary Wharf area in London, Cosort Place is a mixed-use development. The availability of local transport, underground, buses and Crossrail (starting 2020), make Consort Place easily
Slide 25: Upcoming Completion in FY2025 – Victoria Riverside, Manchester
Upcoming Completion in FY2025 – Victoria Riverside, Manchester New homes in the heart of Manchester Set just a stone’s throw from Manchester City Centre, Victoria Riverside is home to 634 new apartments and townhouses. Along Dantzic street will see new life breathed into the railway arches providing
Slide 26: Upcoming Completion FY2025 – Collyhurst Village
Upcoming Completion FY2025 – Collyhurst Village Modern residential neighborhood in close proximity to Manchester City Centre Located 1 mile from Manchester city centre and alongside a new community park. Collyhurst Village is renewing the community spirit and pride of a uniquely inspiring neighbourh
Slide 27: Upcoming Launch – Victoria North NT02-04, Manchester
Upcoming Launch – Victoria North NT02-04, Manchester Where Thriving Homes and Vibrant Community Meet Forming a crucial part of the Victoria North project, this development will feature seven buildings ranging from six to 34 storeys, offering a total of 1,550 homes. Situated between Dantzic Street an
Slide 28: 3. Review of Operations: Hotel Operations & Management
3. Review of Operations Hotel Operations & Management Dorsett Melbourne 28
Slide 29: Performance Supported by Global Economy Re-opening
Performance Supported by Global Economy Re-opening • Hong Kong affected by removal of quarantine stay requirement • Lifting of travel restrictions increased the demand for hotel rooms in Hong Kong commencing in Q2 FY2024 • Ritz-Carlton Melbourne and Dorsett Melbourne ramping up since their openings.
Slide 30: Hotel Opened in FY2023 – Ritz-Carlton Melbourne
Hotel Opened in FY2023 – Ritz-Carlton Melbourne An Expression of Timeless Luxury • Occupies the top 18 floors of West Side Place (Tower 1), Melbourne • The tallest hotel in Australia and the Southern Hemisphere • Offering stunning and expansive views over the Docklands bay and cityscape • Surrounded
Slide 31: Hotel Opened in April 2023 – Dorsett Melbourne
Hotel Opened in April 2023 – Dorsett Melbourne Hotel of choice for business and leisure travelers • Located within the West Side Place development precinct of the Melbourne CBD and occupying levels 3 to 8 of West Side Place (Tower 3) • Surrounded by over 3,000 sqm of retail space and offering conven
Slide 32: Pipeline Hotels to Add to Growth Momentum
Pipeline Hotels to Add to Growth Momentum As at 30.9.2023 As at 31.3.2025 • 8 new hotels under construction in Australia, the UK and Hong Kong with 1,985 rooms in the next 3 years 8,679 10,664 • Ritz-Carlton Melbourne commenced operations in March. Dorsett Melbourne opened in April 2023. Both hotels
Slide 33: Upcoming Hotel Completion – Dorsett Kai Tak, Hong Kong
Upcoming Hotel Completion – Dorsett Kai Tak, Hong Kong Marina escapade in a new urban hub • Boasting spectacular views of Victoria Harbour, the Dorsett flagship hotel sits adjacent to Kai Tak Sports Park, located 15-minute away from the central business district • Inspired by the tranquil elegance e
Slide 34: Upcoming Hotel Completion – Dao by Dorsett Hornsey
Upcoming Hotel Completion – Dao by Dorsett Hornsey A unique combination of contemporary and period furnishings • Located at the heart of Crouch End, adjacent to shops and restaurants on a busy high street, while having good transport link to central London • Part of the restored Grade II* listed Tow
Slide 35: Upcoming Hotel Completion – Dorsett at Canary Wharf
Upcoming Hotel Completion – Dorsett at Canary Wharf London’s most sought-after purpose-built hotel • Located in Canary Wharf, London. This area, situated on the Isle of Dogs, holds great strategic importance as it contributes to London's status as a global hub for financial, media, and business serv
Slide 36: 4. Review of Operations: Car Park Operations
4. Review of Operations Car Park Operations Care Park, Victoria 36
Slide 37: Loosened Restrictions Led to a Recovery
Loosened Restrictions Led to a Recovery • Revenue decreasing 5.2% year-on-year to approximately 30.9.2023 31.3.2023 HK$356 mn, which was primarily attributed by phasing out No. of No. of No. of No. of underperforming car parks in 1H 2024 and sale of an owned car Car Park Bays Car Park Bays park Aust
Slide 38: 5. Review of Operations: Gaming Operations
5. Review of Operations Gaming Operations PALASINO Furth im Wald, Czech Republic 38
Slide 39: Queen’s Wharf Brisbane Progressing to Commencement of Operation
Queen’s Wharf Brisbane Progressing to Commencement of Operation Casino Licence Terms • 99 years with a 25-year casino exclusivity period within 60 kilometers from the Brisbane CBD • 2,500 slots & unlimited gaming tables (including electronic derivations) A World-Class Integrated Resort Details • Ope
Slide 40: Palasino Group - Resilient Recovery and Results Continued to Grow
Palasino Group - Resilient Recovery and Results Continued to Grow Steady Growth in Gaming Revenue Contributed by Loyal Customer Base and Consistent Attendance • Revenues reached HK$ 151 mn(1) (2), a 14.0% increase as compared to 1H FY2023 • Demonstrated remarkable resilience with loyal customer base
Slide 41: 6. Review of Operations: Other Businesses
6. Review of Operations Other Businesses Hornsey Townhall, London 41
Slide 42: BC Invest – Another Year of Strong Growth
BC Invest – Another Year of Strong Growth Overview Catalysts for FY2023 • Asset light platform providing residential mortgages in • Organic growth remains very strong, despite the interest rate Australia and the UK environment • Secured several new warehouses with lending • Normalisation of lending
Slide 43: 7. Prospects
7. Prospects The Star Residences, Gold Coast 43
Slide 44: Outlook
Outlook Balance Sheet Unlocking value and reducing debt level Management • Priority is to reduce debt given high interest rate • Targeting to reduce debt level by a further HK$4.6-5.6 bn through various initiatives as committed, with HK$1.4 bn net debt reduction in 1H FY2024 - Settlement of pre-sale
Slide 45: Outlook
Outlook Hotel Operations Rebound in hotel sector and Management • Recently opened Ritz-Carlton Melbourne and Dorsett Melbourne will contribute in the upcoming year • Expected launch of Dao by Dorsett Hornsey Town Hall and Dorsett Canary Wharf in London, and three hotels under the Queen’s Wharf Brisb
Slide 46: Enhance ESG Efforts to Create Long-Term Value
Enhance ESG Efforts to Create Long-Term Value Strengthen Governance to Improve ESG Performance Formed key internal committees within the ESG Working Group to support the ESG Steering Committee Create strategic ESG Direction for the Group Developed KPI’s with Executing the sustainability Refining Gro
Slide 47: Key sustainability initiatives
Key sustainability initiatives Environmental Social Corporate Governance Waste reduction Employee well-being Formulate sustainability strategy • Reduce distribution of single-use plastic • Adopt flexible working hours and hybrid • Set up ESG Steering committee • Recycle single-use plastic working mo
Slide 48: Reputable Awards for IR and ESG Work
Reputable Awards for IR and ESG Work 1H FY2024 HKIRA 9th Investor Relations 13th Asian Excellence Award 2023 Awards 2023 • Asia’s Best CEO: Tan Sri Dato’ David Chiu, Chairman and Chief • Best IR Company Executive Officer • Best Investor Meeting • Asia’s Best CFO: Mr. Boswell Cheung, Chief Financial
Slide 49: Thank You
Thank You Questions & Answers For more information, please contact: Investor Relations Department: ir@fecil.com.hk Or visit the Company’s website: www.fecil.com.hk FEC Official WeChat 49
Slide 50: 8. Appendices
8. Appendices Mount Arcadia, Hong Kong 50
Slide 51: Significant Hidden Value in FEC’s Hotel Portfolio
Significant Hidden Value in FEC’s Hotel Portfolio Capital Value @ Revaluation City / Country Description Rooms Notes: 31.03.2023 Surplus (HK$ mn) (HK$ mn) (1) The property commenced Hotels in operation Hong Kong operations on 23 March 2023. 1 Dorsett Wanchai Hong Kong Amid Wanchai and Causeway Bay 4
Slide 52: Details of Major Investment Properties
Details of Major Investment Properties Total GFA Total GFA Current Investment Properties (sq. ft.) Pipeline Investment Properties (sq. ft.) FEC Building, Central, Hong Kong 3,000 Queen's Wharf Brisbane(1), Brisbane 209,600 FEC Building, Nathan Road, Hong Kong 38,700 Kai Tak, Hong Kong 190,100 Far Ea
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