Good's afternoon, our friends from the media. I'd like to welcome you all to the MTRC 2023 Annual Results Announcement. I am Linda Choy, Corporate Affairs and Branding Director. Let me first introduce to you our senior management sitting at the center is Dr. Jacob Kam, our CEO; to his right, we have Ms. Jeny Yeung, Managing Director, Hong Kong Transport Services; and Dr. Tony Lee, Operation and Innovation Director. To his left, we have Mr. Michael George Fitzgerald, Finance Director; Mr. David Tang, Property and International Business Director; Mr. Carl Devlin, Capital Works Director.
The press conference will be conducted mainly in Cantonese with interpretation into English. Dr. Kam will briefly present towards the annual results for 2023. Following that, Mr. Fitzgerald will report on the financial results. Following that, Dr. Jake again will talk about the outlook. And following that, we have a Q&A session. Dr. Kam.
Good afternoon, ladies and gentlemen. In 2023, Hong Kong's economic and social activities gradually return to normal. We also made steady progress across our businesses. We remain committed to providing safe, efficient and reliable services to keep Hong Kong moving. We also embrace smart technology, began construction for new railways and implemented business strategies in order to overcome market challenges and to achieve sustainable commercial business operations.
In our core business of Railway Services, the total patronage in Hong Kong exceeded 1.8 billion last year, which was close to returning to pre-pandemic levels. Furthermore, we maintain a world-class level of over 99.9% for both train service delivery and passenger journeys on time on our heavy rail network. In our cross-boundary services, the Lo Wu and Lok Ma Chau stations of the East Rail line faced some competition while remaining popular among cross-boundary travelers. We also enhanced facilities and open a new duty-free building in Lo Wu station last December.
On the high-speed rail Hong Kong section, we achieved a new record of serving over 20 million passenger journeys in 2023. We continue to collaborate closely with the Mainland railway authorities to enhance our high-speed rail services. MTR is dedicated to embracing innovation and technology in the corporation's businesses. Last year, we introduced more electronic payment options in the heavy rail network. In addition, we have implemented innovation and technology to improve customer service, maintenance and train service management. On our new railway projects, we adopted building information modeling, BIM and other technologies to improve the construction efficiency.
As I reported last year, the corporation is planning to invest into several new railway projects. Notably, the construction of the Tung Chung Line Extension, Tuen Mun South Extension, Kwu Tung Station and Oyster Bay Station commenced last year. Furthermore, Hung Shui Kiu on the Tuen Ma Line and the Northern Link have been gazetted. These new projects will promote economic activities and contribute to the increase in housing supply while fostering better connectivity among communities.
In our property business, we expect to book profits from the sales of several property development projects this year. In our mall business, The Wai a top Tai Wai Station opened last year. While THE SOUTHSIDE, our new shopping mall at Wong Chuk Hang Station also began a phased opening. Moreover, we are making progress on 14 property development projects. We will continue to explore property development opportunities along our existing and future railway lines.
In our Mainland China and international businesses, the full Beijing Metro Line 16 is now in passenger service. The remaining sections of Beijing Metro Line 17 and Shenzhen Metro Line 13 are under construction. For overseas business, the Elizabeth Line railway service in the U.K. achieved a stable performance with the operating concession extended to May 2025. Our concession for the Melbourne metropolitan rail network was also extended to mid-2026. We have been struggling with 2 challenging operating contracts in Stockholm. Therefore, we will be terminating early, the Stockholms pendeltåg and Mälartåg operating contracts. We will continue to explore good opportunities for railway and property development in the Mainland of China, including the Greater Bay Area and overseas.
The corporation attaches great importance to responsible environment, social and governance actions. We are pleased that design-based target initiative SBTi organization has approved our targets to cut around half of our greenhouse gas emission by 2030, supporting our long-term goal of achieving carbon neutrality by 2050. We are committed to incorporating green designs and features into our new railway and property development projects.
We continue to foster strong connections with the community. In addition, the corporation is dedicated to integrating art into our stations and shopping malls to improve customer experience. Through our Legacy Train Revitalization Programme, we give retired trains a meaningful second life and showcase them in the community.
The corporation concluded the fare adjustment mechanism FAM review with the government last year, in which the direct drive formula is maintained, while the fare adjustment is linked to the corporation's property development profit, the mechanism takes into consideration both the public's affordability and the corporation's sustainable development. While the property development profit fluctuates year by year, we have significant recurrent revenue from diversified sources, including transport fare, station, commercial and shopping mall businesses. These will ensure our financial sustainability for advancing new railway projects as well as maintaining and renewing existing railway assets to deliver railway services in better quality and wider coverage.
After taking into full account the corporation's financial position and future capital requirements, the Board has proposed a final ordinary dividend of HKD 0.89 per share, bringing the total ordinary dividend for the year to HKD 1.31 per share. I will now pass to Michael for some of our financial highlights.
Thank you, Jacob. Recurrent businesses in Hong Kong recorded a profit of HKD 4.9 billion, significantly higher than in 2022, mainly due to the ongoing recovery of business following the end of pandemic-related restrictions and the resumption of cross-boundary services. Recurrent businesses outside Hong Kong recorded a profit of $0.4 billion, excluding the provisions of $1 billion made in respect of 2 concession agreements in our international business, which had been facing challenging conditions and from which we are now successfully exiting.
Underlying business profit was HKD 6.4 billion. While this represents a 40% decrease compared to last year, this reduction is mainly due to the basis effect of the very strong property profits booked in 2022. Together with the $1.4 billion gain from the initial recognition of new investment properties, the total net profit attributable to shareholders for 2023 was HKD 7.8 billion.
The group's financial position remains robust. As at the end of December 2023, the combined total of our available cash balances and undrawn committed facilities exceeded $40 billion. Our net debt-to-equity ratio remained at a healthy level of 26.5%.
I now turn to the profits of our various business segments. In Hong Kong, the EBIT generated by our transport operations remained negative at just over $1.1 billion, but this represents a very significant improvement on the 2022 negative EBIT for the same business of $4.7 billion. This was due both to the rebound in domestic patronage after the end of the pandemic and to recoveries in cross-boundary services, high-speed rail and Airport Express patronage.
Our station commercial EBIT increased 67%, predominantly due to the resumption of duty-free shop rental revenue after the reopening of boundary crossing stations.
The EBIT of MTR's property rental and management business increased by 5.2%, due mainly to contributions from our new mall at The Wai and to the lower amortization costs of rental concessions in line with the gradual recovery of the market.
Outside Hong Kong, the EBIT of our Mainland China and international subsidiaries decreased mainly due to the expiry of government subsidies for Shenzhen Line 4 and the impact of adverse operating conditions that have been affecting 2 of our international contracts, both of which will shortly have been successfully brought to an end by mutual agreement with our counterparties.
In terms of our consolidated balance sheet, total assets increased by $19 billion to $346 billion mainly due to the increase in cash balances and to the receipt of our shopping mall, the south side. Total liabilities increased by $20 billion to $168 billion, mainly due to the net drawdown of loans, the deferred income relating to THE SOUTHSIDE shopping mall and the amounts received in respect of our Hong Kong property development. As such, total equity was essentially flat at $179 billion.
As for our consolidated cash flow position, our operating activities generated $11.2 billion of net cash inflow. Net receipts from property developments were $6.1 billion. After including $12.6 billion of CapEx and other smaller items, our net cash inflow before financing was $4.4 billion. Finally, after net debt drawdown and dividend payments, the increase in cash was $6.2 billion.
With regard to our financing and credit position, total group borrowings increased by $11.6 billion to $59.5 billion. Around 2/3 of our borrowings were on a fixed rate basis, which has helped to mitigate the adverse impact of interest rate hikes in recent years. Our average borrowing cost for 2023 was 3.5%, 1 percentage point higher than last year but still low by historical standards and in absolute terms.
MTR's core interest cover ratio stood at a solid 9.8x. The total CapEx from 2024 to 2026 is estimated to be $87.9 billion, of which 47% or $41 billion will be used for Hong Kong railway maintenance CapEx. This is higher than previous years, mainly because several railway maintenance and asset replacement projects are taking place at the same time, including train, signaling and power systems. 35% will be used for new Hong Kong railway projects, including Oyster Bay station, Tung Chung Line Extension, Kwu Tung Station and Tuen Mun South Extension. 14% will be allocated to the Hong Kong property business, and the remaining 4% is for Mainland China and overseas investments.
With that, I will now hand back to Jacob to present our outlook.
[Interpreted] Thank you, Michael. MTR Corporation is rooted in Hong Kong with the railway as our core business. This year marked our 45th anniversary. Throughout our journey, we have grown alongside with the people of Hong Kong connecting communities and keeping cities moving through our global railway network.
Going forward, corporation will continue to adopt a customer-centric approach. We are committed to maintaining world-class railway services by allocating resources to enhance the customer experience and railway, asset renewal and maintenance. Moreover, we will accelerate the adoption of innovation and technology in our businesses, including customer service, asset management and railway construction management. To achieve this, we will collaborate with established partners, start-up companies to explore innovative solutions and technological applications.
The corporation welcomes the government's plan for the enhanced strategic railway under the Hong Kong Major Transport Infrastructure Development, blueprint. We will support the government in advancing these new railway projects and contributing to the future development of Hong Kong.
On property development, subject to the construction and sales progress, we expect to book property development profits from THE SOUTHSIDE Packages 4 and 5 and the Ho Man Tin Station Packages 1 and 2. Against the background of uncertainties in the global economy and in the pace of interest rate changes, we will continue to closely monitor market conditions to develop appropriate tender plans for property development projects.
In Mainland China and overseas, the construction of the Shenzhen Metro Line 13 project continues to progress as planned, and the opening of the city section of the Sydney Metro City and Southwest Line are scheduled for 2024. We will continue to develop -- pursue development opportunities in Mainland China, including the Greater Bay Area and overseas.
Finally, I want to express my heartfelt gratitude to my colleagues for the dedication of professionalism, especially for the swift response and team spirit, they demonstrated during the typhoons and extreme weather conditions last year.
The achievements of the corporation today are indeed attributable to the high level of professionalism and collaborative efforts of our colleagues over the past 4 to 5 years. As we move forward, we will continue to keep cities moving and Go Smart Go Beyond together with our communities. Thank you.
[Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]
