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2014 Results1
2014 Review
• Strong underlying profit
• Increased contribution from commercial portfolio
• Moderately reduced residential performance despite strong profits from Hong Kong and mainland China
• Stable asset values
2014 Results2
2014 Results Highlights
2013 2014
US$935m Underlying profit attributable to shareholders US$930m
US$255m Non-trading items US$397m
US$1,190m Profit attributable to shareholders US$1,327m
US¢39.73 Underlying earnings per share US¢ 39.52
US¢50.56 Earnings per share US¢ 56.42
US$11.41 NAV per share US$11.71
US¢12.00 Final dividend per share US¢ 13.00
US¢18.00 Total dividend per share US¢ 19.00
2014 Results4
Commercial Portfolio (’000 sq. ft NFA)
HKL’s Share Office Retail Hotel Total
Hong Kong 4,142 592 143 4,877
Macau - 94 151 245
Singapore 1,651 134 - 1,785
Jakarta 661 66 - 727
Hanoi 105 11 - 116
Bangkok 27 61 - 88
Others 71 - 312 383
TOTAL 6,657 958 606 8,221
2014 Results5
Hong Kong
1. One Exchange Square
2. Two Exchange Square
3. Three Exchange Square
4. The Forum
5. Jardine House
6. Chater House
7. Alexandra House
8. Gloucester Tower
9. Edinburgh Tower
9a. The Landmark Mandarin Oriental
10. York House
11. Landmark Atrium
12. Prince’s Building
2014 Results6
Hong Kong Central Grade “A” Office Rental Index
80
100
120
140
160
180
2010 2011 2012 2013 2014
Index
Source: Jones Lang LaSalle
2014 Results7
Hong Kong Central Grade “A” Office Market
-0.5
0
0.5
1
1.5
2
2.5
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19
Vacancy %m sq. ftNew supply Net take up Vacancy
0
3
6
9
12
15
Disclaimer: The above forecast shall be regarded solely as a general guide. No representation is made nor responsibilityaccepted by Jones Lang LaSalle for the accuracy of the whole or any part whatsoever.
Source: Jones Lang LaSalle
2014 Results
-2
0
2
4
6
8
10
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19
Vacancy %m sq. ftNew supply Net take up Vacancy
8
Hong Kong Grade “A” Office Market
0
3
6
9
12
15
Disclaimer: The above forecast shall be regarded solely as a general guide. No representation is made nor responsibilityaccepted by Jones Lang LaSalle for the accuracy of the whole or any part whatsoever.
Source: Jones Lang LaSalle
2014 Results9
Hongkong Land Central Portfolio: Office
2012 2013 2014
Average Net Rent (HK$ psf/month) 90 99 102
Year-end Vacancy 3.4% 5.0% 5.4%
Weighted Average Lease Expiry (years) 3.7 3.6 3.4
2014 Results10
Hong Kong: Office Tenant Profile
Banks and
other financial
services
39%
Legal
31%
Accounting
8%
Governments
1%
Trading
2%
Property
6%
Others
13%
2014 Results11
Hong Kong: Expiration and Interim Rent Revisions
2015 2016 2017
Total lettable office area subject toexpiration/rent revisions (‘000 sq. ft)
1,034 865 1,456
% of area subject to expiration/rent revisions 25% 21% 35%
Average expiring net rent (HK$ psf/month) 95 105 104
2014 Results12
Hongkong Land Central Portfolio: Retail
2012 2013 2014
Average Net Rent (HK$ psf/month) 171 201 214
Year-end Vacancy 0% 0% 0%
Weighted Average Lease Expiry (years) 2.5 2.4 2.8
Note: Vacancy excludes areas under renovation.
2014 Results13
• Retail component 96% let
• 5% increase in average rent
Macau
One Central (47%-owned)
2014 Results
Singapore
One Raffles Link(100%-owned)
Marina Bay Financial Centre(33%-owned)
One Raffles Quay(33%-owned)
14
2014 Results
-1
0
1
2
3
4
5
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19
Vacancy %m sq. ft New supply Net take up Vacancy
15
Singapore CBD Grade “A” Office Market
CBD – Raffles Place, Shenton Way, Marina Bay & Marina Centre
0
3
6
12
15
9
Disclaimer: The above forecast shall be regarded solely as a general guide. No representation is made nor responsibilityaccepted by Jones Lang LaSalle for the accuracy of the whole or any part whatsoever.
Source: Jones Lang LaSalle
2014 Results16
Office Retail Total HKL’s Share
One Raffles Link 239 73 312 312
One Raffles Quay 1,330 4 1,334 445
Marina Bay Financial Centre 2,906 179 3,085 1,028
TOTAL 4,475 256 4,731 1,785
Singapore Commercial Portfolio (’000 sq. ft NFA)
2014 Results17
Singapore: Office Tenant Profile
Banks and
other financial
services
75%
Legal
5%
Accounting
3%
Natural
resources
8%
Others
9%
2014 Results18
Singapore: Office Average Rents and Occupancy
Note: According to local market practice, the average office rent includes management charges.
2012 2013 2014
Average Gross Rent (S$ psf/month) 8.7 9.1 9.2
Year-end Vacancy 5.6% 1.7% 1.7%
Weighted Average Lease Expiry (years) 6.6 5.9 5.5
2014 Results19
Singapore: Expiration and Interim Rent Revisions
2015 2016 2017
HKL’s Share: Total lettable office area subject to expiration/rent revisions (‘000 sq. ft)
120 311 317
% of area subject to expiration/rent revisions 7% 19% 19%
Average expiring rent (S$ psf/month) 9.5 11.1 9.2
Note: According to local market practice, the average office rent includes management charges.
2014 Results20
• Existing portfolio features 135,000 sq. m.
• Average gross rent: US$24.0 psm per month(2013: US$21.6 psm per month)
• Occupancy: 95.4%
• Construction begun on new tower, WTC 3
• Strong demand for office space
Jakarta
Jakarta Land (50%-owned)
WTC 3
2014 Results
Hanoi and Bangkok
21
63 Ly Thai To
(74%-owned)
Gaysorn
(49%-owned)
Central Building
(71%-owned)
2014 Results
Phnom Penh
22
EXCHANGE SQUARE (100%-owned)
• Mixed-use complex
• Heart of Phnom Penh
• Completion: 2017
2014 Results23
• Prestigious retail centre, which includes a small luxury hotel
• 43,000 sq. m. lettable retail area
• Completion: end-2016
Beijing
WF CENTRAL (90%-owned)
2014 Results24
• Prime Grade “A” office
• 120,000 sq. m. lettable area
• Completion: 2019
Beijing
CBD (30%-owned)
2014 Results28
Mainland China
Background image from Google Earth
Shenyang
Beijing
Chengdu
Chongqing
Background image from Google Earth
2014 Results29
Mainland China – Completed Projects, Beijing
Project Project Type
Maple Place (90%)
• 16 units handed over in 2014
• 64 units available for future sale, mostly leased
Central Park (40%) • 72 units of serviced apartments
Maple Place
Central Park
2014 Results30
Project Interest Project Type
Bamboo Grove, Chongqing 50% Primarily Residential
Landmark Riverside, Chongqing 50% Residential (76%), Office, Retail & Others
Yorkville South, Chongqing 100% Primarily Residential
Yorkville North, Chongqing 100% Residential (74%), Office, Retail & Others
Central Avenue, Chongqing 50% Residential (66%), Office & Retail
Chengdu Project 50%Residential (46%), Office (14%), Retail (17%), Hotel & Serviced Apartments (23%)
Shenyang Projects 50% Primarily Residential
Mainland China – Development Projects Summary
2014 Results31
Mainland China – Development Projects Summary
HKL’s Share
ProjectYear of
AcquisitionSite Area
(ha)
DevelopableArea
(m sq. m.)
Constructed(m sq. m.)
Under Construction
(m sq. m.)
Bamboo Grove, Chongqing 2005 39 0.73 0.54 0.09
Landmark Riverside, Chongqing 2009 17 0.75 0.10 0.07
Yorkville South, Chongqing 2010 39 0.88 0.28 0.29
Yorkville North, Chongqing 2011 54 1.09 0.16 0.26
Central Avenue, Chongqing 2013 20 0.55 - 0.04
Chengdu Project 2010 10 0.45 0.03 0.12
Shenyang Projects 2007 58 1.01 0.13 -
TOTAL 237 5.46 1.24 0.87
2014 Results32
Mainland China – Revenue Recognised
US$m
Note: The above chart includes HKL’s share of Joint Ventures & Associates.
$213m
$451m
$621m
0
100
200
300
400
500
600
700
2012 2013 2014
Chongqing Chengdu Shenyang Beijing
2014 Results33
Mainland China – Contracted Sales
$429m
$632m $635m
0
100
200
300
400
500
600
700
2012 2013 2014
Chongqing Chengdu Shenyang Beijing
Note: The above chart includes HKL’s share of Joint Ventures & Associates.
US$m
2014 Results34
Mainland China – Contracted Sales
Note: The above chart includes HKL’s share of Joint Ventures & Associates.
$200m$229m
$369m
$263m $262m
$373m
0
100
200
300
400
500
1H '12 2H '12 1H '13 2H '13 1H '14 2H '14
Chongqing Chengdu Shenyang BeijingUS$m
2014 Results35
Mainland China – Contracted Sales
• At 31st December 2014, US$533m (2013: US$534m) in sold but unrecognised contracted sales
• Some 80% of contracted sales scheduled to be recognised in 2015
2014 Results36
Singapore
Hallmark Residences
Palms @ Sixth Avenue
J Gateway
Uber 388
TerrasseRipple Bay
LakeVille
Marina Bay Suites
Choa Chu Kang GroveParcels A & B
2014 Results37
• 221 units, 0.47m sq. ft
• Completion: 2013
• Three units handed over in 2014
• 16 units available for sale
Singapore – Completed Project
Marina Bay Suites (33%-owned)
2014 Results38
Singapore – Completions in 2014
Project UnitsGFA
(‘000 sq. ft)Sold
Terrasse 414 476 100%
Uber 388 95 98 100%
Terrasse
Uber 388
2014 Results39
Singapore – Projects for Completion from 2015
Project UnitsGFA
(‘000 sq. ft)Estimated
Completion DatePre-Sold
Palms @ Sixth Avenue 32 109 2015 - Completed 56%
Hallmark Residences 75 110 2015 - Completed 88%
Ripple Bay 679 672 2015 100%
J Gateway 738 576 2016 100%
LakeVille 699 741 2016 53%
Choa Chu Kang Grove 1,327 1,240 2018 Not launched
TOTAL 3,550 3,448
2014 Results40
• JV with PT Bumi Serpong Damai
• Site area: 67 ha
• Southwest of central Jakarta
• 223 units launched for sale; 59% pre-sold
• Completion of 1st phase: 2016
Indonesia
Nava Park, Greater Jakarta (49%-owned)
2014 Results41
• JV with Astra International
• 509 units of luxury apartments; 78% pre-sold
• Completion: 2018
Indonesia
Anandamaya Residences (40%-owned)
2014 Results42
• JV with Ayala Land
• 182 units; 70% pre-sold
• Completion: 2019
Philippines
Roxas Triangle (40%-owned)
2014 Results44
Consolidated Profit and Loss Account (US$m)
2013 2014
1,857 Revenue 1,876
(940) Net operating costs (809)
917 Operating profit 1,067
235 Share of results of joint ventures 123
(64) Net financing charges (69)
(149) Tax (187)
(4) Non-controlling interests (4)
935 Underlying profit 930
255 Non-trading items 397
1,190 Profit attributable to shareholders 1,327
2014 Results45
Revenue (US$m)
2013 2014
925 Commercial revenue 961
932 Residential revenue 915
1,857 Total 1,876
2014 Results46
Underlying Profit by Business (US$m)
2013 2014
914 Commercial property 953
413 Residential property 398
(60) Corporate expenses (62)
1,267 1,289
(103) Net financing charges (103)
(224) Tax (247)
(5) Non-controlling interests (9)
935 Underlying profit 930
2014 Results47
Commercial Property Underlying Profit (US$m)
2013 2014
Greater China
743 - Hong Kong 772
29 - Mainland China & Macau 29
Southeast Asia & Others
122 - Singapore 130
20 - Others 22
914 Total 953
2014 Results48
Residential Property Underlying Profit (US$m)
2013 2014
Greater China
19 - Hong Kong 69
116 - Mainland China & Macau 179
Southeast Asia & Others
278 - Singapore 149
- - Others 1
413 Total 398
2014 Results49
Consolidated Cash Flow (US$m)
2013 2014
908 Operating activities 699
(378) Investing activities 88
(404) Financing activities (426)
122 Others 7
248 Decrease in net debt 368
(3,273) Net debt at beginning of period (3,025)
(3,025) Net debt at end of period (2,657)
2014 Results50
Operating Activities (US$m)
2013 2014
917 Operating profit excluding non-trading items 1,067
(77) Net interest paid (81)
(139) Tax paid (134)
(367) Payments for residential sites (429)
(303) Development expenditure on residential projects (454)
918 Proceeds from residential sales 962
151 Dividends received from joint ventures 153
(192) Others (385)
908 699
2014 Results51
Investing Activities (US$m)
2013 2014
(40) Major renovations capex (38)
(422) Funding of joint ventures (216)
104 Loan repayments from joint ventures 479
(134) Development expenditure (137)
114 Others -
(378) 88
2014 Results52
Consolidated Cash Flow (US$m)
2013 2014
908 Operating activities 699
(378) Investing activities 88
Financing activities
(397) - Dividends paid by the Company (421)
(7) - Dividends paid to minority shareholders (5)
(404) (426)
122 Others 7
248 Decrease in net debt 368
(3,273) Net debt at beginning of period (3,025)
(3,025) Net debt at end of period (2,657)
2014 Results53
Consolidated Balance Sheet (US$m)
2013 2014
Investment properties
23,583 - Subsidiaries 23,697
4,167 - Joint ventures 4,474
27,750 28,171
Properties held for sale
2,670 - Subsidiaries 2,923
1,247 - Joint ventures 1,372
3,917 4,295
(1,743) Others (2,211)
29,924 Gross assets (excluding cash) 30,255
Financed by:
26,899 - Total equity 27,598
3,025 - Net debt 2,657
29,924 30,255
2014 Results54
Investment Property – Basis of Valuation
Capitalisation Rates 2013 1H 2014 2014
Hong Kong Office - Exchange Square 1 & 2 4.00% 4.00% 4.00%
Hong Kong Retail - Landmark Atrium 4.50% 4.50% 4.50%
Singapore Office - MBFC 3.80% 3.80% 3.75%
Note: These capitalisation rates are provided on an indicative basis.
2014 Results55
Investment Property – Carrying Values (US$m)
Note: The analysis includes share of Joint Ventures & Associates.
2013 2014
Greater China
22,302 - Hong Kong 22,336
1,368 - Mainland China & Macau 1,650
Southeast Asia & Others
3,603 - Singapore 3,628
477 - Others 557
27,750 Total 28,171
2014 Results56
Properties Held for Sale – Carrying Values (US$m)
Note: The analysis includes share of Joint Ventures & Associates.
2013 2014
Greater China
62 - Hong Kong 23
2,308 - Mainland China & Macau 2,435
Southeast Asia & Others
1,456 - Singapore 1,696
91 - Others 141
3,917 4,295
(923) Pre-sale proceeds (941)
2,994 Net investment 3,354
2014 Results57
Gross Assets at 31st Dec 2014
Commercial 88%
Residential 12%
By Activity
Hong Kong 73%
Mainland China and Macau 11%
Southeast Asia 16%
By Location
2014 Results58
Treasury Management
Summary 2013 2014
Net debt (US$m) 3,025 2,657
Gearing 11% 10%
Average tenor of debt (years) 6.7 7.3
Average interest cost 2.7% 2.9%
Credit ratings
- S & P
- Moody’s
A-
A3
A
A3
2014 Results59
2014 Financing Activity
• US$452m notes issued under MTN programme
• Total of US$1.2bn in banking facilities raised
- US$355m in bilateral facilities
- US$500m project loan for WF CENTRAL
- US$339m project loan for Choa Chu Kang project
2014 Results60
$310m
$785m $675m
$1,286m
$882m
$3,263m
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
2015 2016 2017 2018 2019 2020+
Bank Facilities (Drawn & Undrawn) BondsUS$m
Maturity Profile of Committed Facilities/Bonds (US$m)
*
* Includes bonds and notes issued under MTN Programme which are at face value.
2014 Results61
Liquidity at 31st Dec 2014 (All figures in US$bn)
2013 HK$1
S$2
US$ RMB Total
7.1 Committed lines 4.7 2.0 - 0.5 7.2
4.4 Gross debt 3.1 1.2 - - 4.3
2.7 Available lines 1.6 0.8 - 0.5 2.9
1.4 Cash - 0.3 1.0 0.3 1.6
4.1 Available liquidity 1.6 1.1 1.0 0.8 4.5
Notes: (1) HK$ debt includes US$ debt swapped into HK$.(2) S$ debt includes HK$ debt swapped into S$.
2014 Results62
Outlook
• Commercial leasing markets in Hong Kong and Singapore remain stablein 2015
• Further strong profits expected from residential development activitiesin mainland China
• No residential profits in Hong Kong and lower contribution fromSingapore
• The Group continues to seek opportunities in premium commercial andresidential developments in Greater China and Southeast Asia