On Plan in 2019 but Virus in 2020 · Voyage Magazine Best Hotel & Resort Value Awards Best Luxury Hotel TTG China Travel Awards Best Business Hotel in Central South & Southwest China

The Wharf (Holdings) Limited

2019 Final Results - 10 Mar 2020

On Plan in 2019 but Virus in 2020

The Wharf (Holdings) Limited – 2019 Final Results | 2

Overview | Recurrent Income | Asset Turns | Financial Management

• DP -85%

– Met Operating Plans

– Strict Government Controls on Selling Price Prompted Provisions

• IP +44%

– On Plan

• Logistics -17%

– Despite Formation of Hong Kong Seaport Alliance to Compete with Regional Ports

2019 Group UNP -58%



• Substantial Sales & Construction Halted DP Progress

• Gov’t-instructed Closures plus Rental Reliefs to Tenants Hurting IP Performance

• Hotel Occupancy Rate Falls to Low SD with 98% Revenue Loss YoY

• Production Base in South China Far from Full Strength for Cargo Flow

2020 Unprecedented Downturn in Economic Activities Virus Outbreak & Nationwide Control Measures



Mainland China 71%

HK 29%

A Property-focused Company

Properties

91%

Total Assets

(Ex-Cash & Investments)

$184B

Mainland China

71%

Properties 91%

Logistics 8%

Others 1%



Mainland IP Contribution on the Rise

• Expanding Recurrent Income Base

• Virus Outbreak Causing Disruption

• Opportunities in Consumption-led Economy

58%

65%

79%

42%

35%

21%

2017

2018

2019

Mainland IP Hotels & Logistics

(Ex-WREIC)

Mainland IP UNP* Contribution in Recurrent Income

* Underlying Net Profit - Excl. IP Revaluation Surplus & Exceptional Items



• Sound Balance Sheet

• NAV $142.9B ($46.86/ Share)

• IP Book Value $74.8B & Properties for

Sale $44.1B

• Net Debt Decreased by $6.6B to $19.0B

* Underlying Net Profit - Excl. IP Revaluation Surplus & Exceptional Items

HKD Million 2019 2018 %Chg

Group Revenue 16,874 21,055 -20%

Operating Profit 7,869 8,752 -10%

Underlying Net Profit (UNP)* 2,710 6,511 -58%

Profit Attributable to Equity Shareholders 3,386 6,623 -49%

Earnings Per Share (HK$)

- Attributable to Equity Shareholders

- Underlying*

1.11

0.89

2.18

2.14

-49%

-58%

Dividend Per Share (HK$) 0.325 0.65 -50%

Financial Highlights

7 The Wharf (Holdings) Limited – 2019 Final Results |

Overview

Recurrent Income

Asset Turns

Financial Management

Agenda

8


The Wharf (Holdings) Limited – 2019 Final Results |

Mainland IP – Impetus for Growth

• Mainland IP Revenue +14% in 2019

– Driven by CDIFS & CSIFS

• Solid Sales Productivity Supports Malls’ Growth

• Office – Occupancy Improving Steadily Despite

Oversupply

0.6

0.5

0.8

1.0

1.3

2.0

2.3

2.4

2.6

3.4

3.9

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Mainland IP Revenue (HKD billion)

2019 vs 2009: 6.5x

CDIFS Opened

in Jan14

CSIFS Opened

in May18

9



CDIFS – Top Mall in Western China

• Retail Sales RMB6.8B (+14%)

– Among Top 10 Shopping Centres in Entire Mainland

• Immense Efforts in Marketing & VIP Recruitment

• Double-digit Rental Reversion

• Office 85% Committed

2019 CDIFS Mall

Net Revenue (Net of Tax) RMB1,002M (+14%)

Average Monthly Sales (psm) Over RMB6,000

Foot Traffic Growth +11%

Turnover Rent Portion 30%

Occupancy Cost* 13%

* Occupancy Cost = Retail Rental/ Retail Sales

10



CSIFS – Top Mall in Central China

• First Full Year of Business

• Community Hub for the City & Province

• Retail Diversity – 370+ Retail Shops

• Retail Sales RMB4.7B

– Among the Highest in Central China

• LEED Platinum Certification*

2019 CSIFS Mall

Net Revenue (Net of Tax) RMB573M

Average Monthly Sales (psm) ~RMB3,900

Turnover Rent Portion 34%

Occupancy Cost* 10%

* Occupancy Cost = Retail Rental/ Retail Sales

* CSIFS Mall & Tower 1 (Nov-19)

11



Wharf Hotels – Established Presence

Niccolo (Since 2015)

Hong Kong Mainland

The Murray, Hong Kong, a Niccolo

Hotel^

Niccolo Chengdu

Niccolo Changsha

Niccolo Chongqing#

Niccolo Suzhou (Opening in 2021)^

Marco Polo (Since 1986)

Hong Kong Mainland Philippines

Marco Polo Hongkong Hotel^

Gateway Hotel^

Prince Hotel^

Marco Polo Parkside, Beijing*

Marco Polo Shenzhen*

Marco Polo Wuhan

Marco Polo Xiamen*

Marco Polo Lingnan Tiandi, Foshan*

Marco Polo Changzhou^

Marco Polo Jinjiang*

Marco Polo Ortigas, Manila*

Marco Polo Plaza, Cebu*

Marco Polo Davao*

^Owned by WREIC; # 50%-owned; *Owned by Third Party

Classic Brand

Award-winning

Contemporary Chic

12



Niccolo – Market Leader RGI vs. Competitive Set & Absolute RevPAR

Chengdu* Chongqing* Changsha*

RGI# 179 121 131

RevPAR^ USD190 USD123 USD121

2019 YoY Change

Chengdu* Chongqing* Changsha*

RGI# +11 +25 NA

RevPAR^ +USD16 +USD24 NA Chongqing

Changsha

Chengdu

* Opening date: Chengdu Apr-15, Chongqing Sep-17, Changsha Oct-18 ^ RevPAR (Revenue Per Available Room) # RGI (Revenue Generating Index) is an Index of RevPARs of All Hotels in the Same Competitive Set. RGI of 179 Means Outperforming the Comp Set Avg. (of 100) by 79%

13



Niccolo – Award-Winning

The Murray, Hong Kong,

a Niccolo Hotel Chengdu Chongqing Changsha

Conde Nast Traveler

Readers’ Choice Awards 2019

#1 in Top 10 Hotels in Hong Kong & Macao

Business Traveller Asia-Pacific

Best Business Hotel in Chengdu

2016 - 2019

Voyage Magazine

Best Hotel & Resort Value Awards

Best Luxury Hotel

TTG China Travel Awards

Best Business Hotel in

Central South & Southwest China

Travel + Leisure

It List 2019

Target Taste Hotel Awards 2019

Best Art Design Hotel of the Year

Grand Hotels Media

New Hotel with Luxury Glamour of the Year

Key Awards

14



Logistics – Persisting through Challenges

• Macro Challenges & Regional Competition

• HK Throughput -10%

• HK Seaport Alliance (since 1 Apr 2019)

– Rebuild Competitiveness of HK Port over time

Modern Terminals (2019)

Revenue $2,584M (-1%) Operating Profit $500M (-15%)

Throughput (million TEUs)

HK 5.0 -10%

DCB^ 1.3* +3%

SCT^ 5.7* +1%

Total 12.0 -4%

Hong Kong Air Cargo Terminals Ltd (HACTL)^

Total Throughput 1.6M Tonnes (-6%)

* Total Throughput (Instead of Attributable)

Market Throughput: Kwai Tsing: -8%; Shenzhen: Flat

^ DCB: 65%-owned; SCT: 20%-owned; HACTL: 20.8%-owned


Overview

Recurrent Income

Asset Turns


Agenda

16



Quality Landbank

Mainland DP

Landbank 3.5M s.m

Key Cities

Shanghai Beijing

Suzhou Hangzhou

Shanghai

Suzhou

Hangzhou

Beijing

Hong Kong

HKDP

Landbank* 3.3M s.f

Luxury-focused

* Incl. IPs in HK

17



New Land Sites

Kai Tak Site

Acquisition Date Nov 2019

Site Location Kai Tak Runway Tip

Product Type Luxury Residential

Total GFA 1.2M s.f

Wharf’s Consideration HK$4.8B

Stake 30%

Hangzhou Project (雍景山)

Acquisition Date Dec 2019

Site Location Fuyang District

Product Type Villas, Townhouses,

Duplexes & Apartments

Total GFA 328,000 s.m

Consideration HK$1.4B

Stake 100%

18



HKDP – Mount Nicholson

• Resilient Luxury Residential Market

• Contracted Sales $4.2B (Gross Basis)

• Attributable Profit Booked in 2019 $0.6B

• 4 Houses/ Apts. to be Recognized in 2020

2019 Sales

4 Houses 3 Apartments

$92,000 psf

(Average)

$104,000 psf

(Average)

Total Contracted Sales $4.2B (Gross Basis)

19



Mainland DP – Exceeding Target

• Solid Underlying Market Demand

• 67% of Total Sales

– 10 Projects

– 4 Cities (Hangzhou, Beijing, Shanghai & Suzhou)

• Profitability Challenged by Pricing Control

2019 Contracted Sales

Sales RMB19.9B -13%

GFA 0.6M s.m -18%

ASP RMB33,200 psm +6%

2020 Sales Target

2020 Sales Target RMB15B

Sellable Resources 1.3M s.m

20



Mainland DP – Margin-oriented

• Profitability Warped by Price Control

• Net Order Book RMB27.4B or 0.9M s.m

• 2020 Target Completion 1.2M s.m

2019 Operating Matrix

Revenue $14,806M -33%

Operating Profit $4,927M -38%

Operating Margin 33% -3 ppts

Completed GFA 0.4M s.m -53%

Recognized GFA 0.4M s.m -49%


Overview

Recurrent Income

Asset Turns


Agenda

22



Prudent Financial Management

• Net Debt: $19.0B

• Gearing: 13.0%

• Average Interest Cost: 3.6%

• Interest Cover: 5.1x

• Floating Rate Debt: 80%

10.6

8.5

4.0

12.7

8.2

2.3

2020

2021

2022

2023

2024

2025 & After

Debt Maturity (HKD billion) (As at 31 Dec 2019)

Total: $46.3B


Agenda

Outlook



Outlook

Macro Headwinds

• Pre-occupied with Virus Outbreak

• High Sino-US Tensions

• Global Economy is Nervous

• Would not Look for Stabilization before

Late 2020

1Q20 Consigned to a Washout*

• Retail: Material Rent Relief & Marketing Aid

• Hotel: Revenues <5% of Same Time 2019

• DP: Construction & Sales Ground to a Halt

• Cargo: Movement Thinned

• 2Q20 in Jeopardy even if Virus Troubles

Clear

* For These Sectors


Agenda

Coming Attractions


Coming Attractions

HK Property Kowloon Tong & Kai Tak Land Sites

Hotel Niccolo Suzhou

Mainland DP 3 Upcoming Projects for Sale

Mainland IP CDIFS & CSIFS Remain Bright Spots

Logistics HK Seaport Alliance Efficiency Gain to Reveal


Agenda

Sustainability


2019 Key Achievements

• Published standalone Sustainability Report in

accordance with the core option of GRI

Standards

• Has raised its first Green Loan Facility in the

amount of HK$2 billion to refinance Chengdu

IFS, the Group’s first IFS flagship project in

Mainland China

• Hang Seng Corporate Sustainability Index

Series Member 2019-2020

• Accredited Hong Kong Quality Assurance

Agency’s CSR Index Plus mark

• 5 years + Caring Company Logo


Green Building Design

• Incorporated green features and used locally sourced materials in property design

• Consider energy efficiency, indoor air quality, emissions reduction and the like

• LEED Platinum – Changsha IFS, Chengdu IFS

LEED Gold – Shanghai Wheelock Square, Wuxi IFS


Project WeCan

• Launched in 2011, to provide secondary school

students who are disadvantaged in learning

with opportunities and care

• To date, the no. of partner schools reached 76,

over 70,000 students benefitted

• Our Business Units are now partnering

5 WeCan schools to provide support.


Appendix

Agenda


Summary of HK Properties Portfolio Usage Status Locations Attributable GFA (s.f.)

1. Peak Portfolio Residential Sales Mount Nicholson (50%-JV) 42,000

Lease Chelsea Court 43,000

Strawberry Hill 13,000

Redevelopment 1 Plantation Road 91,000

11 Plantation Road 46,300

77 Peak Road 42,200

Sub-total 277,500

2. Kowloon East Portfolio Commercial Sales Peninsula East 42,600

Industrial Redevelopment Kowloon Godown# 1,032,000

Residential Development Yau Tong Bay (15%-JV) 611,400

Kai Tak (30%-JV) 361,500

Sub-total 2,047,500

3. Non-Core Commercial Lease Cable TV Tower Units 566,000

4. Kowloon Tong Portfolio Residential Development Kowloon Tong 436,400

Total 3,327,400

As of 31 Dec 2019 ; # GFA of Existing Building


Mainland Contracted Sales Breakdown by City

Region City Contracted Sales (%) GFA Sold (%)

Eastern China Shanghai 11% 3%

Suzhou 31% 35%

Wuxi 1% 2%

Ningbo 0% 0%

Hangzhou 26% 26%

Eastern China Sub-Total: 69% 66%

Western China Chengdu 3% 8%

Chongqing 3% 5%

Western China Sub-Total 6% 13%

Southern China Foshan & Guangzhou 4% 9%

Others Beijing 19% 10%

Tianjin, Dalian & Wuhan 2% 2%

Southern & Others Sub-Total 25% 21%


11 Projects Launched in 2019

Projects City New Launch

Attributable Proceeds (RMB M)

Attributable GFA sold (s.m)

Average Price (RMB psm)

Central Manor Guangzhou Mar 124 2,700 46,600

Jinshanlu Site Suzhou Apr 925 19,700 47,000

Guiyu Chaoyang Hangzhou May 2,269 72,800 29,800

Yangcheng Lake (Site 27) Suzhou Aug 826 38,700 21,300

Xingtang Street East Suzhou Oct 1,339 37,500 35,700

Langyun Huayuan Guangzhou Nov 15 364 40,600

Huangpu Street (Site 82) Suzhou Dec 571 14,300 39,900

Parc Grande (Qinglong Site 28) Hangzhou Dec 468 8,000 57,400

Huayuan Road (Site 78) Suzhou Dec 448 15,700 28,600

Parc Royale (Qinglong Site 92) Hangzhou Dec 287 4,700 58,300

Yuanhe Road Site Suzhou Dec 151 6,100 24,900


Mainland Key Projects on Sales in 2019

Projects City Attributable Proceeds (RMB M)

Attributable GFA sold (s.m)

Average Price (RMB psm)

Ownership

West Manor Beijing 2,624 36,200 72,500 80%

Guiyu Chaoyang Hangzhou 2,269 72,800 29,800 50%

Xingtang Street East Suzhou 1,339 37,500 35,700 30%

Villa One Suzhou 1,203 46,800 25,700 60%

Jingan Garden Shanghai 1,196 9,600 124,200 55%

Shanghai Pudong Huangpujiang (E18) Shanghai 1,087 6,800 119,900 100%

Longfor Jade Mansion Hangzhou 1,055 23,200 43,600 26%

Jinshan Lu Site Suzhou 925 19,700 47,000 30%

One Liangma Beijing 850 14,900 57,100 30%

Yangcheng Lake (Site 27) Suzhou 826 38,700 21,300 100%


Mainland DP – 2019 New Land Acquisition

City Date Attributable GFA (s.m) Attributable Consideration Ownership

Suzhou Jan 23,700 RMB0.65B 30%

Hangzhou Dec 328,000 HK$1.36B 100%


Mainland DP Land Bank Breakdown by City

Region City GFA million (s.m) % Total

Eastern China Shanghai 0.1 3%

Suzhou 0.8 23%

Wuxi 0.0 0%

Hangzhou 0.6 17%

Eastern China Sub-Total: 1.5 43%

Western China Chengdu 0.9 26%

Chongqing 0.2 6%

Western China Sub-Total: 1.1 32%

Southern China Foshan & Guangzhou 0.3 8%

Others Beijing 0.2 6%

Changsha 0.4 11%

Tianjin, Dalian & Wuhan 0.0 0%

Southern & Others Sub-Total: 0.9 25%

Total: 3.5 100%


Mainland Key Properties Completion Projects

Key Completion in 2019 Attributable GFA (s.m)

Chongqing The Thorne 101,400

Wuxi River Pitti 82,400

Hangzhou Junting 68,100

Foshan Rosy Mansion 40,600

Foshan Glory Garden 30,800

Hangzhou The Osmanthus Grace 25,400

Projected Key Completion in 2020

Suzhou Yangcheng Lake (Site 27) 201,400

Chengdu Times City 111,200

Hangzhou Guiyu Chaoyang 98,000

Suzhou Yuanhe Road Site 91,400

Suzhou Huayuan Road (Site 78) 90,000

Chengdu Times Town 70,300

Suzhou Huangpu Street (Site 82) 56,700

Shanghai Jingan Garden 56,400


Mainland China New Projects for Sales in 2020

Projects City Ownership

Wuzhong Lot #24 Suzhou 100%

Imperial Park Hangzhou 100%

Parc Royale (Qinglong Site 84) Hangzhou 100%


Mainland IP – Different Series

Times Square

Property Project Nature Total GFA *

(s.m.)

Year of

Completion

Times Square

Chongqing ** O/R 55,000 2004

Dalian** R 17,000 2008

Marco Polo Wuhan** H 38,000 2008

Shanghai IPs

Times Square R/O/S.A 90,000 1999

Wheelock Square O/R 111,000 2010

IFS & Times Outlets

Property Project Nature Total GFA *

(s.m.)

Year of

Completion

Mixed-use IFS Complexes

Chengdu R/O/S.A/ H 603,000 2013-2016

Chongqing** R/O/H 286,000 2017

Changsha R/H 287,000 2018

Wuxi O 189,000 2014

Times Outlets

Chengdu R 63,000 2009

Changsha R 72,000 2016

R = Retail; O = Office; S.A = Serviced Apartments; H = Hotel

* Total Development Area, Excl. Basement Area & Carpark

** Gross Area & Net of Recognized Sales


Commercial Properties Pipeline

486 486 486 558 558 558 558

362 604 687

752 752 752 752

186 186

427 541 541 439 214 214

251 251 251

249

987 905

2013 2014 2015 2016 2017 2018 2019+

Commercial Properties Completion Schedule (’000 s.m)

Changsha IFS

Wuxi IFS

Chongqing IFS*

Chengdu IFS

Other China Commercial Prop.

Total Development Area, Incl. Basement Area & Carpark

*Gross Basis & Net of Recognized Sales

3.4x


Overview of Application of Funds

Major Capital & Development Expenditure

HKD 2019

(Actual)

2020

(Projected)

Hong Kong Properties 5.4B 1.5B

Mainland China IP 0.1B 0.2B

Mainland China DP 8.8B 9.5B

Others 0.1B 3.0B

Total 14.4B 14.2B


On Plan in 2019 but Virus in 2020

Thank You


End of Presentation

The Wharf (Holdings) Limited [HKEx Stock Code: 0004.HK]

Disclaimer

1) All information and data are provided for information purposes only. All opinions included herein constitute

Wharf’s judgment as of the date hereof and are subject to change without notice. The Group, its subsidiaries

and affiliates hereby disclaim (i) all express, implied, and statutory warranties of any kind to user and/or any

third party including warranties as to accuracy, timeliness, completeness, or fitness for any particular

purpose; and (ii) any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or

any part of the information and data contained herein.

2) The full-year statutory financial information of preceding financial years quoted in this presentation are

derived from statutory annual financial statements for that relevant financial years, each of which had been

delivered to Registrar of Companies in accordance with the prevailing Companies Ordinance and were

reported on by the auditors with relevant auditors’ reports without qualification or modification.

Documents

On Plan in 2019 but Virus in 2020 · Voyage Magazine Best Hotel & Resort Value Awards Best Luxury Hotel TTG China Travel Awards Best Business Hotel in Central South & Southwest China