Hang Lung : 2020 Interim Results

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HANG LUNG GROUP LIMITED

(Incorporated in Hong Kong with limited liability)

(Stock Code: 00010)

2020 INTERIM RESULTS

2020 Interim Results

CONTENTS

	Page
Financial Highlights	1
Review of Operations	2
Consolidated Financial Statements	18
Notes to the Consolidated Financial Statements	22
Other Information	33
Glossary	35

2020 Interim Results

FINANCIAL HIGHLIGHTS

in HK$ Million (unless otherwise stated)

RESULTS

For the six months ended June 30

		2020				2019
	Property	Property			Property	Property
	Leasing	Sales	Total	Leasing	Sales	Total
Revenue	4,457	-	4,457		4,505	-	4,505
Mainland China	2,480	-	2,480		2,409	-	2,409
Hong Kong	1,977	-	1,977		2,096	-	2,096
Operating profit	3,243	(4)	3,239		3,432	-	3,432
Mainland China	1,620	(2)	1,618		1,635	-	1,635
Hong Kong	1,623	(2)	1,621		1,797	-	1,797
Gain on disposal of investment properties	-	-	-		-	868	868
Underlying net profit attributable
to shareholders	1,338	(2)	1,336		1,456	868	2,324
Net (decrease)/increase in fair value of properties
attributable to shareholders	(2,931)	-	(2,931)	1,385	-	1,385
Net (loss)/profit attributable to shareholders	(1,593)	(2)	(1,595)	2,841	868	3,709
		At June 30,		At December 31,
			2020				2019
Shareholders' equity			87,564				91,294
Net assets attributable to shareholders per share (HK$)		$64.3				$67.0
Earnings and Dividend (HK$)
			2020				2019
(Loss)/earnings per share
- based on underlying net profit attributable to shareholders		$0.98				$1.71
- based on net (loss)/profit attributable to shareholders		($1.17)			$2.72
Interim dividend per share			$0.19				$0.19
Financial ratio
		At June 30,		At December 31,
			2020				2019
Net debt to equity ratio			20.0%				17.3%
Debt to equity ratio			22.4%				19.7%

1

2020 Interim Results

REVIEW OF OPERATIONS

CONSOLIDATED RESULTS

For the six months ended June 30, 2020, total revenue of Hang Lung Group Limited (the Company) and its subsidiaries (collectively known as "the Group") declined 1% to HK$4,457 million, and operating profit decreased 6% to HK$3,239 million, owing to the outbreak of the novel coronavirus disease (COVID-19). The performance of the Mainland portfolio was adversely impacted by a 4.5% Renminbi (RMB) depreciation against the Hong Kong Dollar (HKD) over the corresponding period last year. No property sales revenue was recognized during the first half of 2020 and 2019.

Due to a one-off disposal gain recognized in the first half of 2019 in respect of a non-core property, underlying net profit attributable to shareholders period-on-period fell 43% to HK$1,336 million or 8% on a comparable basis. Underlying earnings per share decreased correspondingly to HK$0.98.

With the net revaluation loss of properties attributable to shareholders of HK$2,931 million, net loss attributable to shareholders was HK$1,595 million (2019: net profit of HK$3,709 million). The loss per share was HK$1.17 (2019: earnings per share of HK$2.72).

Revenue and Operating Profit for the Six Months Ended June 30

			Revenue				Operating Profit
	___________________________	___________________________
	2020	2019	Change	2020	2019	Change
	___________________________	___________________________
	HK$ Million	HK$ Million			HK$ Million	HK$ Million
Property Leasing	4,457	4,505	-1%		3,243	3,432	-6%
Mainland China
	2,480	2,409	3%			1,620	1,635	-1%
Hong Kong		1,977	2,096	-6%			1,623	1,797	-10%
Property Sales	-	-	-		(4)	-	N/A
	___________________________	___________________________
Total	4,457	4,505	-1%		3,239	3,432	-6%
	___________________________	___________________________

DIVIDEND

The Board of Directors has declared an interim dividend of HK19 cents per share for 2020 (2019: HK19 cents) to be paid by cash on September 29, 2020, to shareholders whose names appeared on the register of members on September 16, 2020.

2

2020 Interim Results

PROPERTY LEASING

For the six months ended June 30, 2020, the overall leasing revenue of the Group declined by 1% to HK$4,457 million. The rental performance of the Hong Kong portfolio was adversely affected by both the COVID-19 pandemic and social unrest, with leasing revenue shrinking by 6% period-on-period. Various measures including the granting of rent relief were carried out to ease the hardship of tenants. Despite similar challenges brought about by COVID-19 at the beginning of the year, our Mainland leasing properties achieved a revenue growth of 8% in RMB terms and 3% in HKD terms attributable to the rapid recovery of Mainland businesses starting from April onwards.

A relief fund of RMB10 million was established in support of measures to stem the spread of COVID-19 on the Mainland and in Hong Kong.

Mainland China

In the first six months of 2020, total leasing revenue of the Mainland portfolio grew by 8% to RMB2,246 million, partly attributable to the commencement of new leasing properties, namely Kunming Spring City 66, Office Tower 2 at Wuxi Center 66, and Conrad Shenyang at Shenyang Forum 66 during the third quarter of 2019. Excluding these new properties, rental revenue still advanced 2% period-on-period despite the impact of COVID-19. This set of performance was remarkable in the face of the pandemic.

Retail sales increased by 6%. Contributed by a strong rebound in luxury spending, retail sales at Shanghai Plaza 66, Shanghai Grand Gateway 66 and Wuxi Center 66 recorded growth in the range of 7% to 17%, with a corresponding increase of 6% to 15% in rental revenue.

As COVID-19 in mainland China subsided, luxury sales rebounded significantly starting from April, reflecting the pent-up demand that was also fueled by reshoring of spending in this sector. Through product innovation, redistribution of merchandise and targeted promotions on omni-channels, luxury brands seized opportunities to generate sales exceeding pre-pandemic levels. On the other hand, retail properties with fewer luxury tenants, recovered only moderately and recorded negative growth for the period, primarily due to the sales loss during the lock-down. This reflected both government and business have adopted a much more prudent approach towards resumption of normal life.

3

2020 Interim Results

Our office portfolio in mainland China was less affected by COVID-19 attributable to the high quality of service standard for hygiene and sanitation by the property management of the Group. At Wuxi Center 66, new tenancies in the new Office Tower 2 offset the drop in occupancy at Office Tower 1. Office leasing at the new Kunming Spring City 66 office tower progressed well. As a result, the office sector recorded a 1% income growth in the first half of 2020.

Overall operating profit for the Mainland portfolio grew by 4% while the average rental margin was 65%.

Mainland China Property Leasing Portfolio for the Six Months Ended June 30

		Revenue
City and Name of Property		(RMB Million)	Occupancy Rate*
____________________________	___________________________	_______________
	2020	2019	Change	Mall	Office
	___________________________	_______________
Shanghai Plaza 66	861	827	4%	95%	91%
Shanghai Grand Gateway 66	637	583	9%	94%	96%
Shenyang Palace 66	85	95	-11%	83%	N/A
Shenyang Forum 66 #	127	113	12%	83%	88%
Jinan Parc 66	148	158	-6%	92%	N/A
Wuxi Center 66 #	154	140	10%	92%	64%
Tianjin Riverside 66	80	93	-14%	84%	N/A
Dalian Olympia 66	67	74	-9%	80%	N/A
Kunming Spring City 66 #	87	-	N/A	84%	22%
	___________________________
Total	2,246	2,083	8%
	___________________________
Total in HK$ Million equivalent	2,480	2,409	3%

* All occupancy rates stated herein were as of June 30, 2020.

• New properties opened in the second half of 2019: Conrad Shenyang at Shenyang Forum 66, Office Tower 2 at Wuxi Center 66, and the mall and office tower at Kunming Spring City 66.

• Malls

The total revenue of our portfolio climbed 9% to RMB1,618 million after the opening of the new mall in Kunming in August 2019, adding to our eight existing malls in mainland China. The revenue of the eight existing malls generated 4% more in revenue compared to the first half of last year.

4

2020 Interim Results

Income from the Shanghai Plaza 66 mall increased by 9% during the reporting period. The growth was partly offset by rent relief offered during the height of the COVID-19 crisis and transitional voids to accommodate brand expansions and relocations. Firmly positioned as the Home to Luxury and leveraging on HOUSE 66, our nationwide customer relationship management (CRM) program, Plaza 66 recorded the strongest bounce back from the COVID-19 pandemic among Mainland malls. Its retail sales grew by 17% period on period, benefitting from pent-up demand and the repatriation of luxury spending. Taking advantage of the upward trend in local luxury spending, we will continue to cultivate customer loyalty and boost tenant sales.

Revenue from the Shanghai Grand Gateway 66 mall advanced 15% to RMB453 million, as the benefits of Asset Enhancement Initiatives (AEI) started to flow through. The basement was reopened in June 2019, and the main atrium of the South Building with its strong collection of luxury brands was opened in December 2019. The North Building, comprising a trendy mix of lifestyle brands and a refurbished cinema, complemented the much-enhanced luxury offering in the South Building. Together, they have turned Grand Gateway 66 into a popular hub for young and affluent customers. The second phase of the renovation covering the upper floors of the South Building will be completed in the third quarter of 2020. Total retail sales have seen a strong recovery in the post-COVID-19 period, exceeding the first half of last year by 7%. The retail sales for the second quarter jumped 41% period-on-period.

Income at the Shenyang Palace 66 mall retreated by 11% to RMB85 million due to the postponement of new store openings and the closure of some stores under local government directives in light of COVID-19. Retail sales declined 34% period-on-period and occupancy dropped by eight points to 83%. Shopping sentiment has recovered modestly but daily footfall has yet to return to pre-pandemic levels, although over 96% of stores have resumed business as of June 2020. The mall was also affected by extensive road works conducted by the government along the pedestrianized zone during the period. Nevertheless, Palace 66 launched various sales-driven promotional campaigns in conjunction with its 10th Anniversary celebration in June to boost retail sales and footfall.

The leasing performance of the Shenyang Forum 66 mall was likewise negatively impacted by the pandemic and witnessed a drop in footfall, overall sales and revenue in the first half of 2020. Both retail sales and revenue retreated 14%. However, sales in the luxury segment rebounded strongly in May and June. The nationwide CRM program, HOUSE 66, will be launched in August to capture high-level spending and loyalty.

5

2020 Interim Results

Income at the Jinan Parc 66 mall fell by 6% to RMB148 million and retail sales dropped by 34% period-on-period. Retail sales at the mall are recovering due to strong marketing efforts and the deployment of the HOUSE 66 program.

The Wuxi Center 66 mall achieved 6% revenue growth with its continuous improvement in trade mix and is expected to become the center of luxury in the city. The adverse impact from COVID-19 was offset by the higher base and turnover rent from luxury brands. The HOUSE 66 program, launched in 2019, played its part in promoting solid growth and sustainability in luxury sales. Retail sales advanced 13% period-on-period, with a particularly strong recovery from the outbreak seen in the second quarter when retail sales leaped 50% period-on-period.

As part of pandemic control measures, the Tianjin Riverside 66 mall was ordered to close for five weeks between February and March by the local government. Revenue decreased by 14% period-on-period to RMB80 million, and retail sales plunged by 40%. The mall has been collaborating with tenants since its re-opening and is now on the road to recovery.

The Dalian Olympia 66 mall was also not spared from the wrath of COVID-19. Revenue at the mall fell by 9% to RMB67 million. Nevertheless, the mall has secured a strong line-up of luxury brands and several of them started to take possession in the second quarter, paving the way for the arrival of an attractive cluster over the balance of the year and into 2021. For the reporting period, retail sales retreated 27% in the first half but have been demonstrating a healthy rebound since the second quarter. The HOUSE 66 program was successfully launched in June 2020.

In Kunming Spring City 66, top luxury brands are arriving throughout the summer as planned. The mall generated rental revenue of RMB74 million in the first half of 2020. The retail performance of key luxury brands has led a rebound to pre-pandemic levels, while sales in other trades also showed upward momentum.

• Offices

During the first six months of 2020, our seven office towers in four cities generated 1% more in revenue for a total of RMB542 million, mainly due to the new income stream from the second office tower at Wuxi Center 66 and the office tower at Kunming Spring City 66, both of which commenced operations in the third quarter of 2019. In the wake of the COVID-19 pandemic, leasing activities remained subdued and revenue at existing office towers decreased mildly by 2%.

6

2020 Interim Results

Revenue from the two office towers at Shanghai Plaza 66 dropped by 4% period-on-period. Despite some smaller tenants deciding to vacate during the pandemic, larger international groups in fashion and professional services took the opportunity to expand under one roof at Plaza 66, enhancing the overall quality of our tenant portfolio. As a result, rental income is expected to stabilize once pandemic-related transitional adjustments are settled.

Revenue from the office tower at Shanghai Grand Gateway 66 was flat at RMB120 million. Occupancy rate was stable at 96%. The competitive position of the office tower was enhanced as the AEI of the mall is close to completion, attracting more quality tenants such as multinational corporations and large domestic enterprises.

Income at the Shenyang Forum 66 office tower decreased by 1% period-on-period. The occupancy rate slipped one point to 88% as a few tenants downsized in response to the pandemic.

Total revenue from the two office towers at Wuxi Center 66 rose by 18% in the first half of 2020. The new lettings and occupancy at Office Tower 2 more than offset a minor retreat in Office Tower 1 due, again, to the effects of the pandemic. Office Tower 2 successfully captured demand from the insurance and technology sectors as well as industries from the new economy, achieving a satisfactory absorption rate with its occupancy rate reaching 33% as of June 30, 2020.

The office tower at Kunming Spring City 66 collected RMB13 million in rents during the period. The occupancy rate was 22% at period-end. Benefitting from its location and premium facilities, the office tower attracted renowned tenants from fast growing industries in the Southwest, including insurance, banking, finance, e-commerce and pharmaceutical.

• Hotel

Conrad Shenyang was opened in September 2019, and contributed RMB22 million in revenue for the first half of 2020. Both room sales and the food and beverage business were significantly impacted by the COVID-19 pandemic. As the restaurants reopened and business and leisure travels started to resume, revenue was gradually picking up in May. The pace of recovery will depend on the stability of disease control measures on a nationwide scale.

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2020 Interim Results

• Residential and Serviced Apartments

Income from residential and serviced apartments at Shanghai Grand Gateway 66 declined by 7% period-on-period. The occupancy rate dropped by 12 points to 79% owing to softened demand from expatriates.

Hong Kong

The performance of Hong Kong portfolio was severely affected by the COVID-19 pandemic and the social unrest. Revenue dropped 6% to HK$1,977 million while operating profit declined by 10% to HK$1,623 million. Rental margin was at 82%.

The more tourist-oriented trades with street frontage in Fashion Walk Causeway Bay and Mongkok were the worst hit within the portfolio, both in terms of tenant sales and rental revenue, while community malls like Kornhill Plaza and Amoy Plaza were more resilient.

The office sector also faced challenges, as there was a decline in business for the semi-retail trades and food and beverage tenants, a decrease in patients at medical clinics, and extensive shut-down of education centers, gyms and beauty services, some by government order.

Hong Kong Property Leasing Portfolio for the Six Months Ended June 30

		Revenue
	(HK$ Million)		Occupancy Rate*
	______________________________	________________
	2020	2019	Change
	______________________________
Commercial	1,143	1,207	-5%	97%
Office and Industrial / Offices	695	728	-5%	89%
Residential & Serviced Apartments	139	161	-14%	58%
	______________________________
Total	1,977	2,096	-6%
	______________________________

• All occupancy rates stated herein were as of June 30, 2020.

8

2020 Interim Results

• Commercial

Revenue from our Hong Kong commercial portfolio decreased 5% period-on-period to HK$1,143 million. The overall occupancy rate increased one point to 97%.

The Causeway Bay portfolio was the hardest hit owing to the drastic drop in tourists and associated retail spending. Income of this portfolio dropped 13% to HK$281 million period-on-period and the occupancy rate declined seven points to 92%.

Our Mongkok portfolio was severely affected as well, given its exposure to tourism related businesses. Revenue at Grand Plaza and Gala Place in Mongkok decreased by 9% during the period. Both properties remained fully let at the reporting date.

Our community malls, namely Kornhill Plaza in Hong Kong East and Amoy Plaza in Kowloon East, were less affected. Revenue at Kornhill Plaza increased by 1% while revenue at Amoy Plaza retreated moderately by 5%. The mega department store, AEON STYLE, at Kornhill Plaza has demonstrated its strong positioning even under market conditions and continued to perform well in contrast to other trades.

Peak Galleria was reopened in the second half of 2019 after major asset enhancement. Despite reopening at a challenging time, the occupancy rate of the mall reached 89% by the end of the reporting period.

• Offices

Income of the Hong Kong office portfolio fell by 5% period-on-period to HK$695 million as the market stumbled under pressure from COVID-19. The overall occupancy rate fell by four points to 89%. Our offices in Central were more resilient and collected 4% more rent during the reporting period mainly due to positive rental reversions and stable occupancy. The Mongkok and Causeway Bay portfolios have a heavy mix of medical and semi-retail tenants and revenues there dropped by 5% and 10% respectively due to lower occupancy and rent relief granted. Hong Kong office rental accounted for 35% of total leasing income in Hong Kong.

• Residential and Serviced Apartments

Revenue from the apartments shrank by 14% period-on-period to HK$139 million, owing to lower occupancy at Kornhill Apartments and The Summit.

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2020 Interim Results

PROPERTY SALES

During the first six months of 2020, we sold the last unit (duplex) of The Long Beach. As the sale will be recognized upon completion of legal assignment later this year, no revenue or profit in respect of the transaction was recorded in the first half of 2020.

PROPERTY REVALUATION

As of June 30, 2020, the total value of our investment properties and investment properties under development amounted to HK$189,257 million. The value of the Hong Kong portfolio and the mainland China portfolio was HK$64,719 million and HK$124,538 million, respectively. These properties were revalued by Savills, an independent valuer, as of June 30, 2020.

A revaluation loss of HK$4,805 million (2019: gain of HK$2,039 million) was recorded, representing a 2% decrease in valuation compared to the value recorded at December 31, 2019.

The mainland China portfolio recorded a loss of HK$2,419 million (2019: HK$359 million), mainly reflecting the drop in market rents during the period. Although the performance of our Mainland leasing portfolio has been demonstrating a healthy recovery since the second quarter, tenants remained cautious about capital expenditures on expansions and rental reversions on lease renewals, particularly for the office tenants.

The Hong Kong portfolio had a revaluation loss of HK$2,386 million (2019: gain of HK$2,398 million). The decrease in appraised value of our investment properties in Hong Kong reflected the drop in market rents and weakened consumer spending as a result of the pandemic and in the aftermath of social unrest.

Our investment properties are held as long-term investments for recurring income. The revaluation loss is non-cash in nature, there will be no material effect on the operating cash flow and dividend distribution capability.

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2020 Interim Results

PROPERTY DEVELOPMENT AND CAPITAL COMMITMENT

The total values of development projects in investment properties for leasing and properties for sale were HK$26,441 million and HK$5,389 million, respectively. These represented mainland China projects in Wuhan, Wuxi, Kunming, Hangzhou and Shenyang, and redevelopment projects in Hong Kong. At the reporting date, our capital commitments for investment properties amounted to HK$24 billion .

Mainland China

The next Mainland project to commence operations will be Wuhan Heartland 66, which will house a premier mall, a Grade A office tower and serviced apartments for sale, with a total gross floor area of 460,000 square meters. Construction works were suspended after the COVID-19 outbreak in January, but have resumed since April 2020. The completion of the mall and the office tower will be around the last quarter of 2020. Construction of the three residential towers has commenced and is scheduled for completion, in stages, beginning in the last quarter of 2022.

Phase two of Wuxi Center 66 comprises luxury serviced apartments and a boutique hotel, with a total gross floor area of 108,982 square meters. The master layout plan of the project has been approved and excavation works commenced in 2019. The project is expected to reach completion from 2023 onwards.

The remaining development at Kunming Spring City 66 comprises a five-star hotel and luxury apartments. The planning permit was obtained in May 2020 with project completion scheduled for 2023.

Hangzhou Westlake 66 project, a high-end commercial complex with a total gross floor area of 194,100 square meters above-ground, comprises a retail podium with five Grade A office towers and a luxury hotel. Piling works have already started and the project is scheduled for completion, in phases, from 2024.

The master layout plan of the remaining phases of Shenyang Forum 66, consisting of offices, apartments and a retail podium with a total gross floor area of 502,660 square meters, was approved in April 2020. Construction works will commence, in phases, beginning the second half of 2020.

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2020 Interim Results

Hong Kong

In a joint venture project with our subsidiary, Hang Lung Properties Limited (Hang Lung Properties), the Group is re-developing226-240 Electric Road in North Point into a Grade A office tower. Total gross floor area of the project is approximately 105,000 square feet inclusive of a retail area on lower floors. Construction works have been started and the project is expected to complete in 2022.

Ownership of the former Amoycan Industrial Centre in Ngau Tau Kok was consolidated by Hang Lung Properties through Compulsory Sale for Redevelopment Order in April 2019. The site is well located with proximity to MTR Kowloon Bay Station and the future East Kowloon Cultural Centre. It will be redeveloped into residential units for sale with a total gross floor area of 155,000 square feet, and some commercial areas on the podium floors. The project is targeted for completion in 2023.

LIQUIDITY AND FINANCIAL RESOURCES

The Group maintained an appropriate capital structure with a high degree of agility. The objective is to have access to multiple channels of funding for meeting operational needs and business expansions and for risk mitigation purposes. All financial risk management, including debt re-financing, foreign exchange exposure, and interest rate volatility, etc., are centrally managed and controlled at the corporate level.

• Liquidity and Financing Management

Cash flow position and funding needs are closely monitored and regularly reviewed to ensure that we have a good degree of financial flexibility and liquidity while optimizing net financial costs.

As of June 30, 2020, total cash and bank balances amounted to HK$3,626 million (December 31, 2019: HK$3,660 million). All deposits are placed with banks with strong credit ratings and the counterparty risk is monitored on a regular basis.

We focus on mitigating foreign exchange, interest rate, and re-financing risks in managing our debt portfolio. An appropriate mix of RMB/HKD/USD borrowings, fixed/floating rate debts, a staggered debt repayment profile, and a diversified source of funding are maintained.

12

2020 Interim Results

As of June 30, 2020, total borrowings amounted to HK$33,856 million (December 31, 2019: HK$31,113 million), of which about 35% was denominated in RMB. The higher debt balance against the previous year-end was due to construction payments for the various projects under development in mainland China and Hong Kong.

During the period, the Group entered into a number of interest rate swap contracts swapping a total of HK$4.5 billion floating rate borrowings to fixed rate with the objectives of mitigating interest rate volatility risks and optimizing interest costs. The Group has also printed additional Medium Term Notes of HK$4.0 billion in the first half of 2020, of which HK$1.2 billion were classified as green bonds under our Green Finance Framework established in 2019 as part of our ESG (environmental, social and governance) initiatives. As a result, fixed rate borrowings accounted for 63% of the total borrowings of the Group as of June 30, 2020.

The composition of our debt portfolio can be categorized as follows:

i) by currency (after currency swap):

Denominated in:

HKD

RMB

Total borrowings

At June 30, 2020

_______________________

HK$ Million	% of Total
22,121	65%
11,735	35%
_______________________
33,856	100%

_______________________

At December 31, 2019
______________________
HK$ Million	% of Total
19,556	63%
11,557	37%
______________________
31,113	100%

______________________

ii) by fixed or floating interest (after interest rate swap):

At June 30, 2020

_______________________

	HK$ Million	% of Total
Fixed	21,464	63%
Floating	12,392	37%
	_______________________
Total borrowings	33,856	100%
	_______________________

At December 31, 2019
______________________
HK$ Million	% of Total
13,466	43%
17,647	57%
______________________
31,113	100%

______________________

At the reporting date, the average tenure of the entire loan portfolio was 3.0 years (December 31, 2019: 2.9 years) with maturity staggered and spread over a period of over 10 years. Around 57% of the loans were repayable after 2 years.

13

Repayable: Within 1 year

After 1 but within 2 years After 2 but within 5 years Over 5 years

Total borrowings

2020 Interim Results

At June 30, 2020	At December 31, 2019
_______________________	______________________
HK$ Million	% of Total	HK$ Million	% of Total
6,493	19%	3,241	10%
8,141	24%	7,632	25%
16,004	47%	18,668	60%
3,218	10%	1,572	5%
_______________________	______________________
33,856	100%	31,113	100%
_______________________	______________________

At the balance sheet date, total undrawn committed banking facilities amounted to HK$15,178 million (December 31, 2019: HK$14,627 million). The available balances of the USD4 billion (December 31, 2019: USD3 billion) Medium Term Note Program amounted to USD1,941 million, equivalent to HK$15,044 million in total (December 31, 2019: HK$10,965 million).

The undrawn committed banking facilities of the Company and its other subsidiaries, excluding the balances of Hang Lung Properties and its subsidiaries (HLP Group), amounted to HK$4,049 million (December 31, 2019: HK$5,228 million).

• Gearing Ratios and Interest Cover

As of June 30, 2020, the net debt balance amounted to HK$30,230 million (December 31, 2019: HK$27,453 million). Net debt to equity ratio was 20.0% (December 31, 2019: 17.3%) and debt to equity ratio was 22.4% (December 31, 2019: 19.7%).

Excluding the balances of HLP Group, the net debt balance of the Company and its other subsidiaries amounted to HK$838 million (December 31, 2019: HK$1,086 million). The corresponding net debt to shareholders' equity ratio (on an attributable net asset basis) was 1.0% (December 31, 2019: 1.2%).

Gross amount of finance costs decreased by 8% to HK$751 million for the reporting period. The net amount charged to the statement of profit or loss for the six months increased to HK$85 million due to a reduction in finance costs being capitalized to projects under development after the completion and opening of a few new properties during 2019.

Interest income for the period decreased 66% to HK$35 million. The decrease was mainly the

14

2020 Interim Results

result of the utilization of surplus cash to meet construction payments.

For the first half of 2020, the amount of finance costs in excess of interest income, i.e. net interest expense, was HK$50 million (2019: net interest income of HK$39 million). The average effective cost of borrowings for the period was lowered to 4.5% (2019: 4.7%).

Interest cover for the first six months of 2020 was 4 times (2019: 5 times).

• Foreign Exchange Management

The Group has limited exposure to foreign exchange risks, mainly arising from normal operations in mainland China and the two USD500 million bonds issued. Appropriate measures have been taken to mitigate the exposure to foreign exchange risk.

The cash and bank balances at the reporting date comprised of the following currencies:

	At June 30, 2020	At December 31, 2019
	_______________________	______________________
	HK$ Million	% of Total	HK$ Million	% of Total
Denominated in:
HKD	2,136	59%	2,102	57%
RMB	1,381	38%	1,449	40%
USD	109	3%	109	3%
	_______________________	______________________
Total cash and bank balances	3,626	100%	3,660	100%
	_______________________	______________________

(a) RMB Exposure

Our RMB exposure is mainly derived from the currency translation risk arising from the net assets of our subsidiaries in mainland China.

As of June 30, 2020, net assets denominated in RMB accounted for about 63% of our total net assets. As the RMB had depreciated by about 1.9% against the HKD compared to December 31, 2019, the re-translation of these net assets denominated in RMB into HKD using the exchange rate as of the reporting date resulted in a re-translation loss of HK$2,007 million (2019: HK$425 million). The re-translation loss was recognized in other comprehensive income/exchange reserve.

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2020 Interim Results

Our business operations and projects under development in mainland China are funded by cash inflows from mainland China operations and RMB borrowings in addition to capital injections from Hong Kong. We have adopted a systematic approach to mitigate the currency risks and practiced the strict discipline of not taking any speculative position on the movement of the RMB against the HKD. Regular business reviews were undertaken to assess the level of funding needs for our mainland China projects after taking into account various factors such as regulatory constraints, project development timelines, and the market environment. Appropriate modifications to our funding plan will be conducted in light of the change of circumstances.

1. USD Exposure

The USD foreign exchange exposure is related to the two USD500 million fixed rate bonds issued, equivalent to HK$7,751 million at the reporting date. The related currency exchange risk was covered back-to-back by two USD/HKD cross currency swap contracts.

• Charge of Assets

Assets of the Group were not charged to any third parties as of June 30, 2020.

• Contingent Liabilities

The Group did not have any material contingent liabilities as of June 30, 2020.

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2020 Interim Results

OUTLOOK

Two factors that will have major bearings on our performance in the second half of 2020: the sustainability of the retail sales recovery on the Mainland, particularly in the lifestyle sector given the luxury sector proved to recover much faster than expected, and the socio-economic stability in Hong Kong.

Our Mainland properties are expected to fully recover by the end of third quarter and will continue to deliver solid organic growth. Properties commencing business in 2019 will show their full year effect in 2020. On the marketing side, the gradual maturity of the portfolio-wide CRM program HOUSE 66 and the deployment of a variety of digital social platforms will complement the rise in our malls' luxury offering very well. These programs will continue to bring in new business and enhance relationships through strengthening the Hang Lung branded experience and delivering tailor-made services to customers and tenants alike. The continued opening of new luxury shops according to plan in various malls, along with the completion of the AEI at Shanghai Grand Gateway 66 mall in the second half of this year contribute to revenue growth.

Depending on market conditions, we will continue to sell completed residential properties in Hong Kong and explore opportunities to dispose of non-core properties.

On the property development side, two redevelopment projects in Hong Kong are in progress and we will continue to look for development opportunities. On the Mainland, construction of luxury/high-end serviced apartments in our projects in Wuhan, Wuxi, Kunming and Shenyang will continue. Sales and marketing plans for the sales of those apartments are being developed.

17

2020 Interim Results

CONSOLIDATED STATEMENT OF PROFIT OR LOSS

FOR THE SIX MONTHS ENDED JUNE 30, 2020 (UNAUDITED)

		2020	2019
	Note		HK$ Million		HK$ Million
Revenue	2(a)	4,457	4,505
Direct costs and operating expenses		(1,218)	(1,073)
		___________	___________
		3,239	3,432
Other net income	3	27	874
Administrative expenses		(307)	(334)
		___________	___________
Profit from operations before changes
in fair value of properties		2,959	3,972
Net (decrease)/increase in fair value
of properties		(4,805)	2,039
		___________	___________
(Loss)/profit from operations after
changes in fair value of properties		(1,846)	6,011
Interest income			35		104
Finance costs			(85)		(65)
Net interest (expense)/income	4	(50)	39
Share of (losses)/profits of joint ventures		(167)	124
		___________	___________
(Loss)/profit before taxation	2(b) & 5	(2,063)	6,174
Taxation	6	(433)	(734)
		___________	___________
(Loss)/profit for the period		(2,496)	5,440
		___________	___________
Attributable to:
Shareholders		(1,595)	3,709
Non-controlling interests		(901)	1,731
		___________	___________
		(2,496)	5,440
		___________	___________
(Loss)/earnings per share	8(a)
Basic			(HK$1.17)		HK$2.72
Diluted			(HK$1.17)		HK$2.72
		___________	___________

For information purpose only

________________________

2020	2019
RMB Million	RMB Million
4,039	3,899
(1,104)	(928)
___________	___________
2,935	2,971

25771

1. (290)
   ___________ ___________

2,681	3,452
(4,393)	1,775
___________	___________
(1,712)	5,227
32		90
(77)		(57)

1. 33

1. 108
   ___________ ___________

(1,911) 5,368

1. (635)
   ___________ ___________

(2,302)	4,733
___________	___________

(1,469) 3,231

1. 1,502
   ___________ ___________

(2,302)	4,733
___________	___________
(RMB1.08)	RMB2.37
(RMB1.08)	RMB2.37
___________	___________

18

2020 Interim Results

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE SIX MONTHS ENDED JUNE 30, 2020 (UNAUDITED)

(Loss)/profit for the period

Other comprehensive income

Items that are or may be reclassified subsequently to profit or loss:

Movement in exchange reserve: Exchange difference arising from

translation to presentation currency Net investment hedge - net gain

Movement in hedging reserve:

Effective portion of changes in fair value Net amount transferred to profit or loss Deferred tax

Item that will not be reclassified to profit or loss: Net change in fair value of equity investments

Other comprehensive income for the period, net of tax

Total comprehensive income for the period

Total comprehensive income attributable to: Shareholders

Non-controlling interests

2020 HK$ Million

(2,496)

(2,007)

20

(44)

46

3

1

___________

(1,981)

___________

(4,477)

___________

(2,696)

(1,781)

___________

(4,477)

___________

2019 HK$ Million

5,440

(425)

-

48

22

-

1

___________

(354)

___________

5,086

___________

3,514

1,572

___________

5,086

___________

For information purpose only

________________________

2020 2019 RMB Million RMB Million

(2,302) 4,733

907	63
18	-

1. 41

42	20
3	-
1	1
___________	___________

931125

___________ ___________

(1,371)	4,858
___________	___________

1. 3,309

1. 1,549
   ___________ ___________

(1,371)	4,858
___________	___________

19

2020 Interim Results

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT JUNE 30, 2020

Non-current assets

Property, plant and equipment Investment properties Investment properties under

development

Other property, plant and equipment

Interest in joint ventures

Other assets

Deferred tax assets

Current assets

Cash and deposits with banks

Trade and other receivables

Properties for sale

Assets held for sale

Current liabilities

Bank loans and other borrowings Trade and other payables Lease liabilities

Current tax payable

Net current liabilities

Total assets less current liabilities

(Unaudited)	(Audited)	For information purpose only
		________________________
June 30,	December 31,	June 30, December 31,
2020	2019	2020	2019
Note HK$ Million	HK$ Million	RMB Million	RMB Million

9	162,816	168,218	148,683	150,737
9	26,441	27,602	24,152	24,726
	231	231	211	207
	___________	___________	___________	___________
	189,488	196,051	173,046	175,670
	3,931	4,119	3,588	3,693
	1,446	1,445	1,320	1,295
	5	4	5	4
	___________	___________	___________	___________
	194,870	201,619	177,959	180,662
	___________	___________	___________	___________
	3,626	3,660	3,311	3,280
10	2,375	2,298	2,169	2,059
	6,364	5,662	5,811	5,075
11	3	-	3	-
	___________	___________	___________	___________
	12,368	11,620	11,294	10,414
	___________	___________	___________	___________
	6,493	3,241	5,928	2,903
12	7,626	8,752	6,965	7,842
	23	23	21	21
	505	847	461	759
	___________	___________	___________	___________
	14,647	12,863	13,375	11,525
	___________	___________	___________	___________
	2,279	1,243	2,081	1,111
	___________	___________	___________	___________
	192,591	200,376	175,878	179,551
	___________	___________	___________	___________

20

2020 Interim Results

CONSOLIDATED STATEMENT OF FINANCIAL POSITION (Continued) AT JUNE 30, 2020

Non-current liabilities

Bank loans and other borrowings Lease liabilities

Deferred tax liabilities

NET ASSETS

Capital and reserves

Share capital

Reserves

Shareholders' equity

Non-controlling interests

TOTAL EQUITY

(Unaudited)	(Audited)	For information purpose only
		________________________
June 30,	December 31,	June 30, December 31,
2020	2019	2020	2019
HK$ Million	HK$ Million	RMB Million	RMB Million
27,363	27,872	24,983	24,967
284	293	259	262
13,551	13,884	12,378	12,437
___________	___________	___________	___________
41,198	42,049	37,620	37,666
___________	___________	___________	___________
151,393	158,327	138,258	141,885
___________	___________	___________	___________
4,065	4,065	3,164	3,164
83,499	87,229	76,801	78,659
___________	___________	___________	___________
87,564	91,294	79,965	81,823
63,829	67,033	58,293	60,062
___________	___________	___________	___________
151,393	158,327	138,258	141,885
___________	___________	___________	___________

21

2020 Interim Results

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of preparation

The interim results set out in the announcement do not constitute the interim report for the six months ended June 30, 2020 of Hang Lung Group Limited (the "Company") and its subsidiaries (collectively the "Group") but are extracted from the report.

The unaudited interim financial report has been prepared in accordance with Hong Kong Accounting Standard (HKAS) 34, Interim Financial Reporting, issued by the Hong Kong Institute of Certified Public Accountants (HKICPA) and the applicable disclosure provisions of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

The preparation of interim financial report in conformity with HKAS 34 requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses on a year-to-date basis. Actual results may differ from these estimates.

The HKICPA has issued a number of new or amended Hong Kong Financial Reporting Standards (HKFRSs) that are first effective for the current accounting period of the Group. The adoption of these new or amended HKFRSs does not have significant impact on the Group's interim financial report.

The interim financial report has been prepared in accordance with the same accounting policies adopted in the 2019 annual financial statements.

The presentation currency of these consolidated financial statements is Hong Kong dollar. In view of the Group's significant business operations in mainland China, management has included additional financial information prepared in Renminbi in the consolidated financial statements. Such supplementary information is prepared on the same basis as 2019 as if the presentation currency is Renminbi.

22

2020 Interim Results

1. Basis of preparation (Continued)

The financial information relating to the financial year ended December 31, 2019 included in this announcement of interim results as comparative information does not constitute the Company's statutory annual consolidated financial statements for that financial year but is derived from those financial statements. Further information relating to these statutory financial statements disclosed in accordance with section 436 of the Hong Kong Companies Ordinance (Cap. 622) is as follows:

The Company has delivered the financial statements for the year ended December 31, 2019 to the Registrar of Companies as required by section 662(3) of, and Part 3 of Schedule 6 to, the Hong Kong Companies Ordinance.

The Company's auditor has reported on those financial statements. The auditor's report was unqualified; did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying its report; and did not contain a statement under sections 406(2), 407(2) or 407(3) of the Hong Kong Companies Ordinance.

23

2020 Interim Results

2. Revenue and segment information

The Group manages businesses according to the nature of services and products provided. Management has determined property leasing and property sales to be the reportable operating segments for the measurement of performance and the allocation of resources.

Segment assets principally comprise all non-current assets and current assets directly attributable to each segment with the exception of interest in joint ventures, other assets, deferred tax assets and cash and deposits with banks. No segment liabilities analysis is presented as the Group monitors and manages liabilities on a group basis.

1. Disaggregation of revenue
   Revenue for the six months ended June 30, 2020 is analyzed as follows:

HK$ Million

Under the scope of HKFRS 16, Leases:

Rental income

Under the scope of HKFRS 15, Revenue from contracts with customers:

Building management fees and other income from property leasing

20202019

3,9484,033

509	472
___________	___________
4,457	4,505
___________	___________

24

2020 Interim Results

2. Revenue and segment information (Continued)

1. Revenue and results by segments

HK$ Million		2020			2019
	_________________________	_________________________
	Property Property		Property	Property
	Leasing	Sales	Total	Leasing	Sales	Total

Revenue

• Mainland China
• Hong Kong

Profit from operations before changes in fair value of properties

• Mainland China
• Hong Kong

2,480	-	2,480	2,409	-	2,409
1,977	-	1,977	2,096	-	2,096
_______	_______	_______	_______	_______	_______
4,457	-	4,457	4,505	-	4,505
_______	_______	_______	_______	_______	_______

1,488	(2)	1,486	1,476	-	1,476
1,475	(2)	1,473	1,628	868	2,496
_______	_______	_______	_______	_______	_______
2,963	(4)	2,959	3,104	868	3,972

Net (decrease)/increase in fair value of properties

Net interest (expense)/income

• Interest income
• Finance costs

Share of (losses)/profits of joint ventures

(Loss)/profit before taxation Taxation

(Loss)/profit for the period

Net (loss)/profit attributable to shareholders

(4,805)	-	(4,805)
(50)	-	(50)
35	-	35
(85)	-	(85)
(167)	-	(167)
_______	_______	_______
(2,059)	(4)	(2,063)
(433)	-	(433)
_______	_______	_______
(2,492)	(4)	(2,496)
(1,593)	(2)	(1,595)
_______	_______	_______

2,039	-	2,039
39	-	39
104	-	104
(65)	-	(65)
124	-	124
_______	_______	_______
5,306	868	6,174
(734)	-	(734)
_______	_______	_______
4,572	868	5,440
2,841	868	3,709
_______	_______	_______

25

2020 Interim Results

2. Revenue and segment information (Continued)

1. Total segment assets

HK$ Million

Mainland China

Hong Kong

Interest in joint ventures Other assets Deferred tax assets

Cash and deposits with banks

June 30, 2020	December 31, 2019
_________________________	_________________________
Property Property		Property	Property
Leasing	Sales	Total	Leasing	Sales	Total
126,494	2,229	128,723	131,104	1,608	132,712
65,368	4,139	69,507	67,243	4,056	71,299
_______	_______	_______	_______	_______	_______
191,862	6,368	198,230	198,347	5,664	204,011
		3,931			4,119
		1,446			1,445
		5			4
		3,626			3,660
		_______			_______
		207,238			213,239
		_______			_______

3. Other net income

HK$ Million

Government grants

Ineffectiveness on cash flow hedges Gain on disposal of a subsidiary Others

2020	2019
21	-
1	1
-	868
5	5
___________	___________
27	874
___________	___________

26

2020 Interim Results

1. Net interest (expense)/income
   HK$ Million
   Interest income on bank deposits
   Interest expense on bank loans and other borrowings Interest on lease liabilities
   Other borrowing costs
   Total borrowing costs
   Less: Borrowing costs capitalized Finance costs
   Net interest (expense)/income
2. (Loss)/profit before taxation

2020	2019
35	104
___________	___________
708	766
8	8
35	38
___________	___________
751	812
(666)	(747)
___________	___________
85	65
___________	___________
(50)	39
___________	___________

HK$ Million	2020	2019
(Loss)/profit before taxation is arrived at after charging:
Staff costs (Note)	694	679
Depreciation	28	22
	___________	___________

Note: The staff costs included employee share-based payments of HK$32 million (2019: HK$26 million). If the amounts not recognized in the statement of profit or loss, including amounts capitalized, were accounted for, staff costs would have been HK$816 million (2019: HK$824 million).

27

2020 Interim Results

6. Taxation in the consolidated statement of profit or loss

Provision for Hong Kong Profits Tax is calculated at 16.5% (2019: 16.5%) of the estimated assessable profits for the period. Mainland China Income Tax represents mainland China Corporate Income Tax calculated at 25% (2019: 25%) and mainland China withholding income tax calculated at the applicable rates. The withholding tax rate applicable to Hong Kong companies in respect of dividend distributions from foreign investment enterprises in mainland China was 5% (2019: 5%).

HK$ Million

Current tax

Hong Kong Profits Tax

Mainland China Income Tax

Total current tax

Deferred tax

Changes in fair value of properties

Other origination and reversal of temporary differences

Total deferred tax

Total income tax expense

20202019

172	269
335	353
___________	___________
507	622
___________	___________

(180)	41
106	71
___________	___________
(74)	112
___________	___________
433	734
___________	___________

28

7. Dividends

1. Interim dividend
   HK$ Million
   Proposed after the end of the reporting period: HK19 cents (2019: HK19 cents) per share

2020 Interim Results

20202019

258	258
___________	___________

The dividend proposed after the end of the reporting period has not been recognized as a liability at the end of the reporting period.

1. Special and final dividends approved and paid during the six months ended June 30, 2020

HK$ Million

2019 special dividend of HK26 cents (2018: Nil) per share

2019 final dividend of HK63 cents (2018: HK61 cents) per share

8. (Loss)/earnings per share

20202019

354	-
858	831
___________	___________
1,212	831
___________	___________

1. The calculation of basic and diluted (loss)/earnings per share is based on the following data:

HK$ Million	2020	2019
(Loss)/earnings for calculation of basic and diluted
(loss)/earnings per share
(net (loss)/profit attributable to shareholders)	(1,595)	3,709
	___________	___________

29

2020 Interim Results

8. (Loss)/earnings per share (Continued)
(a) (Continued)
	Number of shares
	__________________________
	2020	2019
Weighted average number of shares used in
calculating basic and diluted (loss)/earnings
per share (Note)	1,361,618,242	1,361,618,242
	____________	____________

Note: Diluted (loss)/earnings per share were the same as the basic (loss)/earnings per share for the periods as there were no dilutive potential ordinary shares in existence during the periods.

1. The underlying net profit attributable to shareholders, which excluded changes in fair value of properties net of related income tax and non-controlling interests, is calculated as follows:

HK$ Million

Net (loss)/profit attributable to shareholders

Effect of changes in fair value of properties Effect of corresponding income tax

Effect of changes in fair value of investment properties of joint ventures

Non-controlling interests

Underlying net profit attributable to shareholders

2020	2019
(1,595)	3,709
___________	___________
4,805	(2,039)
(180)	108
237	(56)
___________	___________
4,862	(1,987)
(1,931)	602
___________	___________
2,931	(1,385)
___________	___________
1,336	2,324
___________	___________

The earnings per share based on underlying net profit attributable to shareholders were:

	2020	2019
Basic	HK$0.98	HK$1.71
Diluted	HK$0.98	HK$1.71
	___________	___________

30

2020 Interim Results

1. Investment properties and investment properties under development
2. 1. Additions
      During the six months ended June 30, 2020, additions to investment properties and investment properties under development amounted to HK$1,328 million (2019: HK$9,934 million).
   2. Valuation
      The investment properties and investment properties under development of the Group were revalued as of June 30, 2020 by Mr. Charles C.K. Chan, Registered Professional Surveyor (General Practice), of Savills Valuation and Professional Services Limited, on a market value basis.
3. Trade and other receivables
4. 1. Included in trade and other receivables are trade receivables (based on the due date) with the following aging analysis:

HK$ Million

Not past due or less than 1 month past due 1 - 3 months past due

More than 3 months past due

June 30,	December 31,
2020	2019
81	24
33	27
8	2
___________	___________
122	53
___________	___________

1. The Group maintains a defined credit policy including stringent credit evaluation on and payment of a rental deposit from tenants. In addition to the payment of rental deposits, tenants are required to pay monthly rents in respect of leased properties in advance. Receivables are regularly reviewed and closely monitored to minimize any associated credit risk.
   Provision for expected credit losses was assessed and adequately made on a case-by-case basis, based on the historical default experience and forward-looking information that may impact the tenants' ability to repay the outstanding balances.

31

2020 Interim Results

1. Trade and other receivables (Continued)
2. 1. Included in other receivables of the Group is a deposit of land acquisition in mainland China of HK$274 million (December 31, 2019: HK$279 million).
3. Assets held for sale
   On June 22, 2020, the Group entered into a sale and purchase agreement with an independent third party to dispose of investment properties of two car parking spaces at The Long Beach in Hong Kong. Accordingly, the assets are presented as assets held for sale. The completion of the transaction is scheduled to take place in July 2020.
4. Trade and other payables
   Included in trade and other payables are trade creditors with the following aging analysis:

HK$ Million	June 30,	December 31,
	2020	2019
Due within 3 months	2,850	4,125
Due after 3 months	973	838
	___________	___________
	3,823	4,963
	___________	___________

32

2020 Interim Results

OTHER INFORMATION

Employees

As of June 30, 2020, the number of employees was 4,618 (comprising 1,155 Hong Kong employees and 3,463 mainland China employees). The total employee costs for the six months ended June 30, 2020, amounted to HK$816 million. We provide competitive remuneration packages for all employees including discretionary bonuses payable based on individual performance. We regularly review remuneration packages to ensure that they comply with relevant regulatory requirements and market conditions. The Group has share option schemes for the employees and provides professional and high-quality training opportunities.

Purchase, Sale or Redemption of Listed Securities

During the six months ended June 30, 2020, neither the Company nor any of its subsidiaries purchased, sold or redeemed any of its listed securities.

Compliance with Corporate Governance Code

During the six months ended June 30, 2020, the Company complied with the code provisions set out in the Corporate Governance Code as stated in Appendix 14 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

Review of Interim Results

The interim results for the six months ended June 30, 2020, have been reviewed by the Company's Audit Committee and auditor, KPMG.

33

2020 Interim Results

Book Close Dates

Book close dates (both days inclusive)	September 15 to 16, 2020
Latest time to lodge transfers	4:30 pm on September 14, 2020
Record date for interim dividend	September 16, 2020
Payment date for interim dividend	September 29, 2020

On Behalf of the Board

Ronnie C. Chan

Chairman

Hong Kong, July 30, 2020

As of the date of this announcement, the board of directors of the Company comprises the following directors: Executive Directors: Mr. Ronnie C. CHAN, Mr. Weber W.P. LO, Mr. H.C. HO and Mr. Adriel W. CHAN Non-Executive Directors: Mr. Gerald L. CHAN, Mr. George K.K. CHANG and Mr. Roy Y.C. CHEN Independent Non-Executive Directors: Mr. Simon S.O. IP, Prof. P.W. LIU, Prof. L.C. TSUI and

Mr. Martin C.K. LIAO

34

2020 Interim Results

GLOSSARY

Financial Terms

Finance costs: Total of interest expense on total borrowings and other borrowing costs, net of

amount capitalized

Total borrowings: Total of bank loans & other borrowings, net of unamortized other

borrowing costs

Net debt: Total borrowings net of cash and deposits with banks

Net (loss)/profit attributable to shareholders: (Loss)/profit for the period (after tax) less

amounts attributable to non-controlling interests

Underlying net profit attributable to shareholders: Net (loss)/profit attributable to

shareholders excluding changes in fair value of properties net of related income tax and

non-controlling interests

Financial Ratios

Basic		Net (loss)/profit attributable to
	shareholders	Debt to		Total borrowings
(loss)/earnings	=	=
	equity
Weighted average number of	Total equity
per share
	shares in issue during the period
Net assets
attributable to	=	Shareholders' equity	Net debt to	=	Net debt
shareholders	Weighted average number of	equity	Total equity
per share		shares in issue during the period
		Profit from operations before
Interest cover	=	changes in fair value of properties
Finance costs before capitalization
		less interest income

35