REG - CK Infrastructure - 2025 Interim Report
27/08/2025 11:15
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RNS Number : 8860W CK Infrastructure Holdings Limited 27 August 2025
CKI
GLOBAL INFRASTRUCTURE PLAYER
Interim Report 2025
A Leading Player in the Global Infrastructure Arena
CKI is one of the world's largest global infrastructure companies. The company
aims to make the world a better place through a variety of infrastructure
investments and developments in different parts of the world. The Group has
diversified investments in Energy Infrastructure, Transportation
Infrastructure, Water Infrastructure, Waste Management, Waste-to-energy,
Household Infrastructure and Infrastructure Related Businesses. Its
investments and operations span Hong Kong, Mainland China, the United Kingdom,
Continental Europe, Australia, New Zealand, Canada and the United States.
THE HALF YEAR AT A GLANCE
4,348 1.73 0.73
Profit attributable Earnings Interim dividend
to shareholders
per share
per share
(HK$ million)
(HK$)
(HK$)
CONTENTS
2 Corporate Information and Key Dates
4 Chairman's Letter
11 Financial Review
13 Directors' Biographical Information
24 Consolidated Income Statement
25 Consolidated Statement of Comprehensive Income
26 Consolidated Statement of Financial Position
27 Consolidated Statement of Changes in Equity
29 Condensed Consolidated Statement of Cash Flows
30 Notes to the Consolidated Interim Financial Statements
41 Directors' Responsibility Statement
42 Directors' Interests and Short Positions in Shares, Underlying
Shares and Debentures
48 Interests and Short Positions of Shareholders
50 Corporate Governance
58 Other Information
59 Risk Factors
CORPORATE INFORMATION AND KEY DATES
BOARD OF DIRECTORS
Executive Directors
LI Tzar Kuoi, Victor (Chairman)
FOK Kin Ning, Canning (Deputy Chairman)
Frank John SIXT
KAM Hing Lam (Group Managing Director)
IP Tak Chuen, Edmond (Deputy Chairman)
Andrew John HUNTER (Deputy Managing Director)
CHAN Loi Shun (Chief Financial Officer)
CHEN Tsien Hua
Independent Non-executive Directors
CHEONG Ying Chew, Henry
KWOK Eva Lee
SNG Sow-mei alias POON Sow Mei
LAN Hong Tsung, David
Paul Joseph TIGHE
Non-executive Directors
LEE Pui Ling, Angelina
George Colin MAGNUS
Alternate Directors
MAN Ka Keung, Simon
(alternate to IP Tak Chuen, Edmond)
Eirene YEUNG
(alternate to KAM Hing Lam)
AUDIT COMMITTEE
Paul Joseph TIGHE (Chairman)
CHEONG Ying Chew, Henry
SNG Sow-mei alias POON Sow Mei
LAN Hong Tsung, David
REMUNERATION COMMITTEE
CHEONG Ying Chew, Henry (Chairman)
LI Tzar Kuoi, Victor
SNG Sow-mei alias POON Sow Mei
NOMINATION COMMITTEE
KWOK Eva Lee (Chairperson)
LI Tzar Kuoi, Victor
CHEONG Ying Chew, Henry
SUSTAINABILITY COMMITTEE
IP Tak Chuen, Edmond (Chairman)
Paul Joseph TIGHE
LAN Hong Tsung, David
Eirene YEUNG
EXECUTIVE COMMITTEE
LI Tzar Kuoi, Victor (Chairman)
KAM Hing Lam
IP Tak Chuen, Edmond
Andrew John HUNTER
CHAN Loi Shun
CHEN Tsien Hua
CHAN Kee Ham, Ivan
LUN Pak Lam
LUK Sai Hong, Victor
TONG BARNES Wai Che, Wendy
Duncan Nicholas MACRAE
CHIU Yue Seng
COMPANY SECRETARY
Eirene YEUNG
AUTHORISED REPRESENTATIVES
IP Tak Chuen, Edmond
Eirene YEUNG
PRINCIPAL BANKERS
Australia and New Zealand Banking Group Limited
Bank of China (Hong Kong) Limited
Barclays Bank PLC
BNP Paribas
Canadian Imperial Bank of Commerce
Lloyds Bank plc
Mizuho Bank, Ltd.
MUFG Bank, Ltd.
National Australia Bank Limited
The Hongkong and Shanghai Banking Corporation Limited
CORPORATE BROKERS
Barclays Bank PLC
Jefferies International Limited
UBS AG London Branch
AUDITOR
Deloitte Touche Tohmatsu
Registered Public Interest Entity Auditors
LEGAL ADVISERS
Woo, Kwan, Lee & Lo
REGISTERED OFFICE
Clarendon House, Church Street,
Hamilton HM11, Bermuda
PRINCIPAL PLACE OF BUSINESS
12th Floor, Cheung Kong Center,
2 Queen's Road Central, Hong Kong
PRINCIPAL SHARE REGISTRAR AND TRANSFER OFFICE
Computershare Investor Services (Bermuda) Limited
5 Reid Street, PO Box HM 1475,
Hamilton HM FX, Bermuda
(Location of principal register of members at Clarendon House, Church Street,
Hamilton HM 11, Bermuda)
BRANCH SHARE REGISTRAR AND TRANSFER OFFICE
Computershare Hong Kong Investor Services Limited
Rooms 1712-1716, 17th Floor, Hopewell Centre,
183 Queen's Road East, Hong Kong
STOCK CODES
Stock Exchange of Hong Kong: 1038
London Stock Exchange: CKI
Bloomberg: 1038 HK
Reuters: 1038.HK
WEBSITE
www.cki.com.hk
INVESTOR RELATIONS
For further information about CK Infrastructure Holdings Limited, please
contact:
Ivan CHAN
CK Infrastructure Holdings Limited
12th Floor, Cheung Kong Center,
2 Queen's Road Central,
Hong Kong
Telephone: (852) 2122 3986
Facsimile: (852) 2501 4550
Email: contact@cki.com.hk
KEY DATES
Interim Results Announcement 13th August, 2025
Record Date for Interim Dividend
11th September, 2025
Payment of Interim Dividend
24th September, 2025
CHAIRMAN'S LETTER
During the first half of the year, CK Infrastructure Holdings Limited ("CKI",
the "Company" or the "Group") delivered a steady performance despite
geopolitical and economic uncertainties characterised by shifting political
landscapes, a complex interest rate outlook, trade disruptions and
inflationary pressures.
The Group's financial position also continues to be strong, which not only
reinforces CKI's resilience amidst global volatility but also provides agility
to pursue growth opportunities.
For the six months ended 30th June, 2025, the Group recorded profit
attributable to shareholders of HK$4,348 million, a year-on-year increase of
1%.
DIVIDEND GROWTH
The Board of Directors of CKI (the "Board") has declared an interim dividend
for 2025 of HK$0.73 per share (2024: HK$0.72 per share), representing 1.4%
growth over the corresponding period last year. The interim dividend will be
paid on Wednesday, 24th September, 2025, to shareholders whose names appear on
the Register of Members of the Company at the close of business on Thursday,
11th September, 2025. As at the date hereof, the Company does not hold any
treasury shares whether in the Central Clearing and Settlement System, or
otherwise.
BUSINESS REVIEW
Power Assets
Profit contribution from Power Assets Holdings Limited ("Power Assets") was
HK$1,095 million, an increase of 1% over the same period last year.
Operational performance of international businesses and HK Electric continued
to be solid.
United Kingdom Infrastructure Portfolio
Profit contribution from the United Kingdom ("UK") was HK$2,223 million, an
increase of 19% over the same period last year. (In local currency, the result
was an increase of 17%.) The growth was mainly attributed to the higher
contributions from Northumbrian Water ("NWG"), the Group's three gas
distribution networks, and UK Power Networks ("UKPN").
UKPN reported good earnings growth. Both regulated and non-regulated
businesses performed well, with the latter boosted by new projects as well as
the renewable energy portfolio acquired last year. During the period under
review, UKPN also received noteworthy recognitions, including being named No.
1 Utility in the UK Customer Satisfaction Index 2025 as well as "Data Centre
Energy Solution of the Year" at the Data Centre Review Excellence Awards 2025.
In March, Moody's reaffirmed the credit rating of all UKPN Distribution
Network Operators as "A3/Stable".
The Group's three gas distribution networks in the UK - Northern Gas Networks
("NGN"), Wales & West Utilities ("WWU") and Phoenix Energy - reported good
earnings in the first half of 2025, aided by strong operating performances.
NGN and WWU received their Draft Determinations ("DD") for the period 1st
April, 2026 to 31st March, 2031. The DD outlined higher proposed returns for
the upcoming regulatory period. Both companies will be responding to the DD
within the consultation timeframe. As for Phoenix Energy, it obtained
regulatory approval to extend its licence area to facilitate the connection of
three biomethane production sites, further supporting the decarbonisation plan
of the gas network.
Good growth in profit contribution was reported by NWG. This was mainly a
result of a higher return on higher regulatory capital value due to inflation.
At the Utility Week 2025 Water Industry Awards in June, NWG was the winner of
the "Customer Initiative of the Year" as well as the "Water Efficiency Project
of the Year". NWG entered its new regulatory period on 1st April, 2025, and
alongside several other companies has sought a redetermination by the
Competition and Markets Authority ("CMA"). Approximately GBP6 billion of
expenditure, which includes investments to drive improvements for customers
and the environment, has been proposed by NWG over the next five years. The
CMA appeal result is expected to be released by the end of the year.
UK Rails delivered a good performance in the first half of 2025.
Australian Infrastructure Portfolio
Profit contribution from Australia was HK$793 million, an 8% decrease from
the previous corresponding period. (In local currency, the result was a
decrease of 5%.) Major reasons for the reduction were the weakening foreign
exchange, and a lower contribution from Energy Developments ("EDL") due to the
expiry of various lucrative contracts and lower electricity prices than the
highs experienced last year.
2025 is a key year for the regulatory businesses across CKI's Australian
portfolio as the majority of companies in the country are in the process of
renewing their five-year rate resets for the new regulatory periods commencing
either in 2025 or 2026.
SA Power Networks ("SAPN") entered a new regulatory period from 1st July,
2025. Based on the Final Determination, higher allowed returns and asset base
growth have been approved. In March, SAPN was recognised at the 2025 iTnews
Benchmark Awards for "Best Energy Project".
Victoria Power Networks ("VPN") and United Energy are preparing for their
upcoming regulatory resets, which will commence on 1st July, 2026. Higher
capital investments have been proposed to support the networks' growing
utilisation rates. VPN's unregulated business arm, Beon, has made good
progress in its operations. It has completed construction of the Girgarre
Solar Farm in Victoria, Australia, and the Lauriston Solar Farm in
Christchurch, New Zealand.
Australian Gas Infrastructure Group ("AGIG"), which consists of Australian Gas
Networks ("AGN"), Multinet Gas Networks and Dampier Bunbury Pipeline ("DBP"),
continued its stable operational performance. Preparations are being made by
AGN's operations in South Australia and DBP for their 2026-31 regulatory
resets. During the period under review, Moody's reaffirmed the credit rating
of all AGIG entities at "A3/Stable".
EDL's results were negatively impacted due to various lucrative contracts
expiring and weaker electricity market prices than the highs last year.
Infrastructure Portfolio in Continental Europe
In Continental Europe, profit contribution was HK$432 million, a 3%
year-on-year growth. (In local currency, the result was about the same as the
corresponding period last year.)
ista reported strong performance during the period under review. The company
acquired a meter installation company in Germany, a move in line with its
strategy of strengthening meter installation capacity and expertise in EV
charging services. ista also secured a major contract renewal with Germany's
second largest property manager.
The phase one reconstruction of Dutch Enviro Energy's waste-to-energy plant in
Rozenburg subsequent to the fire in late 2023 has been completed, with all
seven incineration lines now in operation. Phase two of the project, which
involves a new turbine hall and electricity generation resumption, is on track
to be completed early next year.
Canadian Infrastructure Portfolio
Profit contribution from Canada was HK$275 million, a decrease of 9% from the
corresponding period last year. (In local currency, the result was a decrease
of 5%.) The drop was primarily due to Canadian Power having been negatively
affected by lower power generation and lower power prices from its units in
Alberta.
Reliance Home Comfort reported good growth. During the period under review,
the company completed two acquisitions in the United States home services
sector as part of its United States expansion strategy.
Canadian Midstream Assets recorded steady results, while Park'N Fly was
slightly affected by lower revenue arising from weaker price and volume.
New Zealand Portfolio
Profit contribution from New Zealand was HK$80 million, about the same as
last year same period. (In local currency, the result was an increase of 4%.)
Strong performance was recorded at Enviro NZ. The company successfully secured
a number of contracts, including the renewal of a 10-year waste collection
services contract with Taupo District Council.
Wellington Electricity commenced its new regulatory period on 1st April, 2025,
with higher allowed returns and a significant increase in capital investment.
Hong Kong and Mainland China Business
In Hong Kong and Mainland China, CKI's portfolio recorded profit contribution
of HK$98 million, a slight increase of 2%. Performance of transportation
projects in the Mainland was stable, while that for the infrastructure
materials business was flat.
FINANCIAL POSITION CONTINUES TO BE STRONG
CKI's financial position continues to be strong. As at 30th June, 2025, the
Group's cash on hand was HK$4.7 billion, while the net debt to net total
capital ratio was a healthy 10.6%, and an industry low of 48.7% when taking
into account the net debt in the infrastructure investment portfolio on a
look-through basis.
This robust foundation underpins the investment and financial management
principles we consistently uphold. More importantly, it empowers us to weather
market challenges and pursue opportunities around the world.
Standard & Poor's has reaffirmed the Group's credit rating of "A/Stable".
ONGOING SUSTAINABILITY PROJECTS
Our electricity distribution networks in the UK and Australia continue to
advance key sustainability initiatives such as smart grid solutions, electric
vehicle charging infrastructure, and integration systems with renewable energy
sources. Clean hydrogen/ biomethane projects by our gas networks are also
making steady headway in the UK and Australia, alongside Canadian Power's
Okanagan and UK Renewables Energy's wind farms, UK Power Networks Services's
and our Australian unregulated businesses' solar portfolios, as well as HK
Electric's gas-fired generation unit.
SUBSEQUENT EVENT
In July 2025, Eversholt UK Rails Group Limited, a joint venture company of
CKI, CK Asset Holdings Limited ("CK Asset"), Power Assets and CK Hutchison
Holdings Limited, entered into an agreement to divest UK Rails. Completion of
the transaction, which is expected to take place in a few months, is subject
to the fulfilment of certain conditions under the sale and purchase agreement.
Once completed, the proceeds from this transaction will reduce the net debt to
net total capital ratio significantly.
OUTLOOK
Global geopolitical tension and economic uncertainty prevail, posing
challenges and risks for many industries around the world. In an environment
where capital and liquidity are essential for navigating volatility, CKI has
once again demonstrated strong resilience, underpinned by robust recurring
income streams and predictable cashflows.
Despite headwinds in the macro environment, there are growth and expansion
opportunities. Across markets, a combination of factors - including
constrained public budgets, tightened liquidity, rising capital costs, as well
as the need to modernise infrastructure to enhance efficiency, support
urbanisation and advance towards decarbonisation and green targets - have
strengthened the competitive edge of infrastructure players, like CKI, with
strong balance sheets and proven track records.
In addition, the Group is in a unique position to forge acquisition
opportunities together with strategic partners within the CK Group, including
CK Asset and Power Assets, which also command strong financials and share
similar investment philosophies.
Organic growth is also a major focus of CKI's businesses - all prospective
projects are diligently pursued by the respective teams to ensure no
opportunities are missed.
Our steadfast approach towards balancing stability and growth has been
fundamental in our approach for expansion as validated by our track record of
continued earnings growth and comfortable gearing position. We also always
maintain our investment discipline of not bearing a "must-win" mentality in
acquisitions.
I would like to take this opportunity to thank the Board, our staff and our
stakeholders for their continued support and commitment to the Group.
VICTOR T K LI
Chairman
13th August, 2025
FINANCIAL REVIEW
FINANCIAL RESOURCES, TREASURY ACTIVITIES AND GEARING RATIO
The Group's capital expenditure and investments were funded from cash on hand,
internal cash generation, loans, notes, bonds, share placement and other
project loans.
As at 30th June, 2025, cash and bank deposits on hand amounted to
HK$4,721 million and the total borrowings of the Group amounted to
HK$20,706 million, which included Hong Kong dollar borrowings of
HK$260 million and foreign currency borrowings of HK$20,446 million. Of the
total borrowings, 93 per cent were repayable between 2026 and 2029 and 7 per
cent were repayable beyond 2029. The Group's financing activities continue to
be well received and fully supported by its bankers.
The Group adopts conservative treasury policies in cash and financial
management. To achieve better risk control and minimise the cost of funds, the
Group's treasury activities are centralised. Cash is generally placed in
short-term deposits mostly denominated in U.S. dollars, Hong Kong dollars,
Australian dollars, New Zealand dollars, British pound, Canadian dollars,
Euros or Renminbi. The Group's liquidity and financing requirements are
reviewed regularly. The Group will continue to maintain a strong capital
structure when considering financing for new investments or maturity of bank
loans.
As at 30th June, 2025, the Group maintained a net debt position with a net
debt to net total capital ratio of 10.6 per cent. This was based on
HK$15,985 million of net debt and HK$151,220 million of net total capital,
which represents the total borrowings plus total equity net of cash and bank
deposits. The ratio was higher than that of 7.8 per cent at the year end of
2024, which was mainly due to cash movement for hedging instruments.
The net debt to net total capital ratio would be 48.7 per cent by sharing of
net debt in infrastructure investment portfolio on a look-through basis, which
was based on HK$128,588 million of net debt and HK$263,823 million of net
total capital. This ratio was 47.0 per cent at the year end of 2024.
To minimise currency risk exposure in respect of its investments in other
countries, the Group generally hedges those investments with (i) currency
swaps and (ii) the appropriate level of borrowings denominated in the local
currencies. The Group also entered into certain interest rate swaps to
mitigate interest rate risks. As at 30th June, 2025, the notional amounts of
these derivative instruments amounted to HK$58,199 million.
CHARGE ON GROUP ASSETS
As at 30th June, 2025, certain assets were pledged to secure bank borrowings
totalling HK$1,492 million granted to the Group.
CONTINGENT LIABILITIES
As at 30th June, 2025, the Group was subject to the following contingent
liabilities:
HK$ million
Performance bond indemnities 145
Sub-contractor warranties 24
Total 169
EMPLOYEES
The Group, including its subsidiaries but excluding affiliated companies,
employs a total of 2,277 employees. Employees' cost (excluding directors'
emoluments) amounted to HK$510 million. The Group ensures that the pay levels
of its employees are competitive and that its employees are rewarded on a
performance related basis within the general framework of the Group's salary
and bonus system.
Preferential subscription of 2,978,000 new shares of the Company was given to
those employees who had subscribed for shares of HK$1.00 each in the Company
at HK$12.65 per share on the flotation of the Company in 1996. The Group does
not have any share option scheme for employees.
DIRECTORS' BIOGRAPHICAL INFORMATION
LI Tzar Kuoi, Victor, aged 61, has been the Chairman of the Company since its
incorporation in May 1996. He has been a member of the Remuneration Committee
of the Company since March 2005, the Chairman of the Executive Committee of
the Company since April 2005 and a member of the Nomination Committee of the
Company since January 2019. Mr. Li is the Chairman and Executive Director of
CK Hutchison Holdings Limited, and the Chairman and Managing Director and the
Chairman of the Executive Committee of CK Asset Holdings Limited. He is also
the Chairman of CK Life Sciences Int'l., (Holdings) Inc., a Non-executive
Director of Power Assets Holdings Limited and HK Electric Investments Manager
Limited ("HKEIM") as the trustee-manager of HK Electric Investments, and a
Non-executive Director and the Deputy Chairman of HK Electric Investments
Limited. Except for HKEIM, all the companies/investment trust mentioned above
are listed in Hong Kong. Mr. Li is also the Deputy Chairman of Li Ka Shing
Foundation Limited and Li Ka Shing (Global) Foundation, and the Member Deputy
Chairman of Li Ka Shing (Canada) Foundation. He is a member of the 14th
National Committee of the Chinese People's Political Consultative Conference
of the People's Republic of China. He is also Vice Chairman of the Hong Kong
General Chamber of Commerce. Mr. Li is the Honorary Consul of Barbados in Hong
Kong and is awarded the Grand Officer of the Order of the Star of Italy. He is
a director of certain substantial shareholders of the Company within the
meaning of Part XV of the Securities and Futures Ordinance ("SFO"), and a
director of certain companies controlled by certain substantial shareholders
of the Company. He holds a Bachelor of Science degree in Civil Engineering, a
Master of Science degree in Civil Engineering and a degree of Doctor of Laws,
honoris causa (LL.D.). Mr. Li is a nephew of Mr. Kam Hing Lam, the Group
Managing Director of the Company.
KAM Hing Lam, aged 78, has been the Group Managing Director of the Company
since its incorporation in May 1996 and a member of the Executive Committee of
the Company since April 2005. He is the Deputy Managing Director of CK
Hutchison Holdings Limited, the Deputy Managing Director and Executive
Committee Member of CK Asset Holdings Limited, and the President of CK Life
Sciences Int'l., (Holdings) Inc. All the companies mentioned above are listed
companies. Mr. Kam is also the Chairman of Hui Xian Asset Management Limited,
which manages Hui Xian Real Estate Investment Trust, a real estate investment
trust listed on The Stock Exchange of Hong Kong Limited ("SEHK"). Mr. Kam is a
director of certain substantial shareholders of the Company within the meaning
of Part XV of the SFO, and a director of certain companies controlled by
certain substantial shareholders of the Company. He holds a Bachelor of
Science degree in Engineering and a Master's degree in Business
Administration. Mr. Kam is an uncle of Mr. Li Tzar Kuoi, Victor, the Chairman
of the Company.
IP Tak Chuen, Edmond, aged 73, has been an Executive Director of the Company
since its incorporation in May 1996, the Deputy Chairman of the Company since
February 2003, a member of the Executive Committee of the Company since April
2005 and the Chairman of the Sustainability Committee of the Company since
December 2020. He is Deputy Managing Director of CK Hutchison Holdings
Limited, and the Deputy Chairman and Executive Committee Member of CK Asset
Holdings Limited. He is also the Senior Vice President and Chief Investment
Officer of CK Life Sciences Int'l., (Holdings) Inc. All the companies
mentioned above are listed companies. Mr. Ip is also a Non-executive Director
of Hui Xian Asset Management Limited, which manages Hui Xian Real Estate
Investment Trust, a real estate investment trust listed on the SEHK. He is a
director of a substantial shareholder of the Company within the meaning of
Part XV of the SFO, and a director of certain companies controlled by a
substantial shareholder of the Company. He holds a Bachelor of Arts degree in
Economics and a Master of Science degree in Business Administration.
FOK Kin Ning, Canning, aged 74, has been an Executive Director and Deputy
Chairman of the Company since March 1997. Mr. Fok is the Deputy Chairman of CK
Hutchison Holdings Limited. Mr. Fok is also the Chairman of Hutchison
Telecommunications Hong Kong Holdings Limited, TPG Telecom Limited, HK
Electric Investments Manager Limited as the trustee-manager of HK Electric
Investments, and HK Electric Investments Limited and the Executive Chairman of
CK Hutchison Group Telecom Holdings Limited ("CKHGT"). Mr. Fok is also the
Deputy President Commissioner of PT Indosat Tbk. Except for HKEIM and CKHGT,
all the companies/investment trust mentioned above are listed in Hong Kong or
overseas. Mr. Fok is a director of certain substantial shareholders of the
Company within the meaning of Part XV of the SFO, and a director of certain
companies controlled by certain substantial shareholders of the Company. He
holds a Bachelor of Arts degree and a Diploma in Financial Management, and is
a fellow of Chartered Accountants Australia and New Zealand.
Frank John SIXT, aged 73, has been an Executive Director of the Company since
its incorporation in May 1996. Mr. Sixt is the Group Co-Managing Director and
Group Finance Director of CK Hutchison Holdings Limited. He is also the
Non-executive Chairman of TOM Group Limited, the Chairman and an Alternate
Director of Hutchison Telecommunications (Australia) Limited ("HTAL")*, a
Non-executive Director of TPG Telecom Limited, a Director of Cenovus
Energy Inc., and an Alternate Director of HK Electric Investments Manager
Limited as the trustee-manager of HK Electric Investments, and HK Electric
Investments Limited. Except for HTAL* and HKEIM, all the companies/investment
trust mentioned above are listed in Hong Kong or overseas. He has over four
decades of legal, global finance and risk management experience, and possesses
deep expertise in overseeing financial reporting system, risk management and
internal control systems as well as sustainability issues and related risks.
Mr. Sixt is a director of certain substantial shareholders of the Company
within the meaning of Part XV of the SFO, and a director of certain companies
controlled by certain substantial shareholders of the Company. He holds a
Master's degree in Arts and a Bachelor's degree in Civil Law, and is a member
of the Bar and of the Law Society of the Provinces of Québec and Ontario,
Canada.
* HTAL has been removed from the Official List of
Australian Securities Exchange at the close of trading on 25th July, 2025.
Andrew John HUNTER, aged 66, has been an Executive Director of the Company
since December 2006, Deputy Managing Director of the Company since May 2010
and a member of the Executive Committee of the Company since March 2007. He
acted as the Chief Operating Officer of the Company from December 2006 to May
2010. Mr. Hunter is the Chairman of Power Assets Holdings Limited. He is also
an Executive Director of CK Hutchison Holdings Limited. All the companies
mentioned above are listed companies. He is a director of a substantial
shareholder of the Company within the meaning of Part XV of the SFO. Prior to
the appointment to the board of Power Assets Holdings Limited in 1999, Mr.
Hunter was the Finance Director of the Hutchison Property Group. He holds a
Master of Arts degree and a Master's degree in Business Administration. He is
a member of the Institute of Chartered Accountants of Scotland and of the Hong
Kong Institute of Certified Public Accountants. He has over 41 years of
experience in accounting and financial management.
CHAN Loi Shun, aged 63, has been an Executive Director of the Company since
January 2011, Chief Financial Officer of the Company since January 2006 and a
member of the Executive Committee of the Company since April 2005. He joined
the CK Group in January 1992. Mr. Chan is also an Executive Director of Power
Assets Holdings Limited, HK Electric Investments Manager Limited as the
trustee-manager of HK Electric Investments, and HK Electric Investments
Limited. Except for HKEIM, all the companies/investment trust mentioned above
are listed in Hong Kong. Mr. Chan is a fellow of the Hong Kong Institute of
Certified Public Accountants, a fellow of the Association of Chartered
Certified Accountants and also a member of the Institute of Certified
Management Accountants (Australia).
CHEN Tsien Hua, aged 63, has been an Executive Director of the Company since
January 2017, a member of the Executive Committee of the Company since March
2007 and the Head of Business Development of the Company since 2005. She
joined Hutchison Whampoa Limited in August 1992 and has been with the Company
since July 1996. Ms. Chen holds a Bachelor's degree in Social Sciences and a
Master's degree in Business Administration.
CHEONG Ying Chew, Henry, aged 77, has been an Independent Non-executive
Director of the Company since its incorporation in May 1996. He has been a
member of the Audit Committee of the Company since December 1998 and acted as
the Chairman of the Audit Committee of the Company from December 1998 to
December 2006. Mr. Cheong has been a member of the Remuneration Committee of
the Company since January 2005 and the Chairman of the Remuneration Committee
of the Company since January 2012. Mr. Cheong has also been a member of the
Nomination Committee of the Company since February 2024. He is also an
Independent Non-executive Director of CK Asset Holdings Limited, New World
Department Store China Limited and Skyworth Group Limited, and an Independent
Director of BTS Group Holdings Public Company Limited. Mr. Cheong is an
Executive Director and the Deputy Chairman of Worldsec Limited. All the
companies mentioned above are listed companies. He holds a Bachelor of Science
degree in Mathematics and a Master of Science degree in Operational Research
and Management.
KWOK Eva Lee, aged 83, has been an Independent Non-executive Director of the
Company since September 2004. She has been a member of the Nomination
Committee of the Company since January 2019 and the Chairperson of the
Nomination Committee of the Company since December 2020. She acted as a member
of the Audit Committee of the Company from September 2004 to June 2019. She is
also an Independent Non-executive Director of CK Asset Holdings Limited and CK
Life Sciences Int'l., (Holdings) Inc., and a Director of Li Ka Shing (Canada)
Foundation ("LKS Canada Foundation"). She currently serves as the Chair and
Chief Executive Officer of Amara Holdings Inc. ("Amara"). Mrs. Kwok also acts
as an Independent Director of Cenovus Energy Inc. Mrs. Kwok currently acts as
the Chairperson of the Remuneration Committee and a member of the Nomination
Committee of CK Life Sciences Int'l., (Holdings) Inc. and also sits on the
Governance Committee of Cenovus Energy Inc. Except for LKS Canada Foundation
and Amara, all the companies mentioned above are listed companies. She is a
director of a company controlled by a substantial shareholder of the Company
within the meaning of Part XV of the SFO. In addition, she was an Independent
Director of Bank of Montreal, a listed company, and previously sat on the
Human Resources and Compensation Committee of Cenovus Energy Inc., the
Compensation Committee, the Corporate Governance Committee and the Audit
Committee of Husky Energy Inc., the Audit Committee of CK Life Sciences
Int'l., (Holdings) Inc., the Audit Committee and Pension Fund Society of the
Bank of Montreal, the Nominating and Governance Committee of Shoppers Drug
Mart Corporation, the Independent Committee of Directors and Human Resources
Committee of Telesystems International Wireless (TIW) Inc., the Independent
Committee of Directors and the Corporate Governance Committee of Fletcher
Challenge Canada Ltd., the Audit and Corporate Governance Committees of
Clarica Life Insurance Company, the Corporate Governance Committee of Air
Canada, the Innovation Saskatchewan (IS) Board of Directors and the
Saskatchewan-Asia Advisory Council of Saskatchewan.
SNG Sow-mei alias POON Sow Mei, aged 84, has been an Independent Non-executive
Director of the Company since September 2004. She has been a member of the
Audit Committee of the Company since September 2004 and a member of the
Remuneration Committee of the Company since September 2022. She acted as the
Chairperson of the Audit Committee of the Company from July 2020 to May 2022.
She is an Independent Non-executive Director of CK Asset Holdings Limited, a
listed company. She is also an Independent Non-executive Director of ESR Asset
Management (Prosperity) Limited, which manages Prosperity Real Estate
Investment Trust, a real estate investment trust listed on the SEHK. Mrs. Sng
is also a member of the Audit Committee and the Nomination Committee of ESR
Asset Management (Prosperity) Limited. Mrs. Sng was previously an Independent
Non-executive Director, the Lead Independent Director and a member of the
Audit Committee of Hutchison Port Holdings Management Pte. Limited, as the
trustee-manager of Hutchison Port Holdings Trust, a business trust listed on
the Singapore Exchange Securities Trading Limited ("SGX-ST"), an Independent
Director and a member of the Audit Committee of ESR Trust Management (Suntec)
Limited, which manages Suntec Real Estate Investment Trust, a real estate
investment trust listed on SGX-ST, and an Independent Non-executive Director
and a member of the Audit Committee of ESR Asset Management (Fortune) Limited,
which manages Fortune Real Estate Investment Trust, a real estate investment
trust listed on the SEHK. Mrs. Sng was also previously a Director of INFA
Systems Ltd. and the Senior Consultant (International Business) of Singapore
Technologies Electronics Ltd. Prior to her appointment with Singapore
Technologies Pte Ltd. where Mrs. Sng was the Director, Special Projects
(North East Asia) in 2000 and a Consultant in 2001, Mrs. Sng was the Managing
Director of CapitaLand Hong Kong Ltd. for investments in Hong Kong and the
region including Japan and Taiwan. In Hong Kong from 1983 to 1997, Mrs. Sng
was the Centre Director and then as Regional Director of the Singapore
Economic Development Board and Trade Development Board respectively. Mrs. Sng
was Singapore's Trade Commissioner in Hong Kong from 1990 to 1997. Mrs. Sng
holds a Bachelor of Arts degree from the Nanyang University in Singapore and
has wide experience in various fields of industrial investment, business
development, strategic and financial management, especially in property
investment and management. In 1996, Mrs. Sng was conferred the title of PPA(P)
- Pingat Pentadbiran Awam (Perak), the Singapore Public Administration Medal
(Silver) by the Republic of Singapore.
LAN Hong Tsung, David, aged 85, has been an Independent Non-executive Director
and a member of the Audit Committee of the Company since February 2005, and a
member of the Sustainability Committee of the Company since February 2024. Dr.
Lan is an Independent Non-executive Director of Cinda Financial Holdings Co.,
Limited. He is also an Independent Non-executive Director of ESR Asset
Management (Prosperity) Limited, which manages Prosperity Real Estate
Investment Trust, a real estate investment trust listed on the SEHK. He was
previously an Independent Non-executive Director of Hutchison
Telecommunications Hong Kong Holdings Limited and SJM Holdings Limited, both
are listed companies, for 15 years and 11 years respectively. Dr. Lan was also
previously an Independent Non-executive Director of ESR Asset Management
(Fortune) Limited, which manages Fortune Real Estate Investment Trust, a real
estate investment trust listed on the SEHK. He is the Chairman of David H T
Lan Consultants Limited, and holds directorship at Nanyang Commercial Bank,
Limited since April 2002 and International Probono Legal Services Association
Limited since 2019. Dr. Lan acted as Supervisor of Nanyang Commercial Bank
(China), Limited for 12 years and 9 months since December 2007 until his
reappointment as Senior Consultant from October 2020. Dr. Lan was a Senior
Advisor of Mitsui & Company (Hong Kong) Limited for 19 years till his
retirement in March 2019. He was also the President of the International
Institute of Management for almost 7 years till his retirement in June 2019.
He was the Secretary for Home Affairs of the Hong Kong Special Administrative
Region ("HKSAR") Government till his retirement in July 2000. He had served as
civil servant in various capacities for 39 years and was awarded the Gold
Bauhinia Star Medal on 1st July, 2000. He was appointed as the 10th and 11th
National Committee Member of the Chinese People's Political Consultative
Conference of the People's Republic of China. Dr. Lan is a Chartered Secretary
and a Fellow Member of The Hong Kong Chartered Governance Institute and The
Chartered Governance Institute. He received his Bachelor of Arts degree from
the University of London and completed the Advanced Management Program of the
Harvard Business School, Boston. He was also a Fellow at Queen Elizabeth
House, University of Oxford. Dr. Lan was conferred with Doctor of Business
Administration, honoris causa by University of the West of England, Bristol,
Doctor of Humanities, honoris causa by Don Honorio Ventura Technological State
University, and holder of Visiting Professorship Awards of Bulacan State
University and Tarlac State University.
Paul Joseph TIGHE, aged 69, has been an Independent Non-executive Director of
the Company since April 2017. He has been a member of the Audit Committee of
the Company since March 2019 and the Chairman of the Audit Committee of the
Company since May 2022. He has been a member of the Sustainability Committee
of the Company since December 2020. He is also an Independent Non-executive
Director of CK Hutchison Holdings Limited and CK Life Sciences Int'l.,
(Holdings) Inc., both are listed companies. Mr. Tighe is a director of a
substantial shareholder of the Company within the meaning of Part XV of the
SFO, and a director of a company controlled by a substantial shareholder of
the Company. He is a former career diplomat with Australia's Department of
Foreign Affairs and Trade. He has around 37 years of experience in government
and public policy, including 28 years as a diplomat. He has served as
Australian Consul-General to Hong Kong and Macau (from 2011 to 2016),
Australian Ambassador to Greece, Bulgaria and Albania (from 2005 to 2008),
Deputy Head of Mission and Permanent Representative to the United Nations'
Economic and Social Commission for Asia and the Pacific at the Australian
Embassy in Bangkok (from 1998 to 2001) and as Counsellor in the Australian
Delegation to the Organisation for Economic Co-operation and Development in
Paris (from 1991 to 1995). In between overseas assignments, Mr. Tighe has held
several positions at the headquarters of the Department of Foreign Affairs and
Trade in Canberra, including as head of the Department's Trade and Economic
Policy Division, head of the Diplomatic Security, Information Management and
Services Division, head of the Agriculture and Resources Branch and Director
of the International Economic Analysis Section. Before joining the Department
of Foreign Affairs and Trade, Mr. Tighe worked in the Overseas Economic
Relations Division of the Australian Treasury (from 1986 to 1988), in the
Secretariat of the Organisation for Economic Co-operation and Development in
Paris (from 1984 to 1986) and in the Australian Industries Assistance
Commission (from 1980 to 1984). He holds a Bachelor of Science degree from the
University of New South Wales.
LEE Pui Ling, Angelina, aged 76, has been a Non-executive Director of the
Company since September 2004 and prior to that an Independent Non-executive
Director of the Company from May 1996. Mrs. Lee is a solicitor and a Fellow of
the Institute of Chartered Accountants in England and Wales. She holds a
Bachelor of Laws degree from and was awarded an Honorary Fellowship by
University College London, University of London. Amongst her public
appointments, Mrs. Lee was a Member of the Exchange Fund Advisory Committee of
the Hong Kong Monetary Authority and a Non-executive Director of the
Securities and Futures Commission. Mrs. Lee is a Non-executive Director of
Henderson Land Development Company Limited and TOM Group Limited, and an
Independent Non-executive Director of Great Eagle Holdings Limited, all of
which are listed companies. Mrs. Lee is a director of a company controlled by
a substantial shareholder of the Company within the meaning of Part XV of the
SFO.
George Colin MAGNUS, aged 89, acted as an Executive Director and Deputy
Chairman of the Company from May 1996 to October 2005, and has been a
Non-executive Director of the Company since November 2005. He is also an
Independent Non-executive Director of HK Electric Investments Manager Limited
as the trustee-manager of HK Electric Investments, and HK Electric Investments
Limited. He acted as an Executive Director of Cheung Kong (Holdings) Limited
("CKH") since 1980 and Deputy Chairman since 1985 until he retired from these
offices in October 2005. He has been a Non-executive Director of CKH since
November 2005 until his resignation in June 2015. He has been an Executive
Director of Hutchison Whampoa Limited ("HWL") since 1980 and was re-designated
as a Non-executive Director since November 2005 until his resignation in June
2015. He served as Deputy Chairman of HWL from 1984 to 1993. Mr. Magnus was
previously the Chairman of Power Assets Holdings Limited (formerly known as
Hongkong Electric Holdings Limited) from 1993 to 2005, a Non-executive
Director from 2005 to 2012 and an Independent Non-executive Director until
January 2014. He was a Non-executive Director of CK Hutchison Holdings Limited
from January 2015 until his retirement in March 2025. Except for HKEIM, CKH
and HWL, all the companies/investment trust mentioned above are listed in Hong
Kong. He holds a Master's degree in Economics from King's College, Cambridge.
MAN Ka Keung, Simon, aged 68, has been an Alternate Director to Mr. Ip Tak
Chuen, Edmond, Deputy Chairman of the Company, since February 2008. He joined
the CK Group in December 1987. He is Executive Committee Member and General
Manager of Accounts Department of CK Asset Holdings Limited, a listed company.
He is a director of certain companies controlled by a substantial shareholder
of the Company within the meaning of Part XV of the SFO. He has over 44 years
of experience in accounting, auditing, tax and finance. He holds a Bachelor's
degree in Economics and is a member of Chartered Accountants Australia and New
Zealand.
Eirene YEUNG, aged 64, Alternate Director to Mr. Kam Hing Lam, the Group
Managing Director of the Company, and the Company Secretary and a member of
the Sustainability Committee of the Company. She is also Executive Committee
Member and Company Secretary, and General Manager of Company Secretarial
Department of CK Asset Holdings Limited. She is also the Company Secretary of
CK Life Sciences Int'l., (Holdings) Inc. Ms. Yeung is a Non-executive
Director of ESR Asset Management (Fortune) Limited, the manager of Fortune
Real Estate Investment Trust. All the companies/investment trust mentioned
above are listed in Hong Kong. She is a director of certain companies
controlled by a substantial shareholder of the Company within the meaning of
Part XV of the SFO. Ms. Yeung joined the CK Group in August 1994. She is a
solicitor of the High Court of the HKSAR and a non-practising solicitor of the
Senior Courts of England and Wales. She is also a fellow member of The Hong
Kong Chartered Governance Institute and The Chartered Governance Institute.
CONSOLIDATED INCOME STATEMENT
for the six months ended 30th June
Unaudited
HK$ million Notes 2025 2024
Turnover 2 20,359 19,090
Sales and interest income from infrastructure investments 2 2,209 2,478
Other income 3 182 347
Operating costs 4 (1,827) (1,918)
Finance costs (432) (415)
Exchange gain 71 108
Share of results of associates 1,382 1,351
Share of results of joint ventures 3,034 2,626
Profit before taxation 4,619 4,577
Taxation 5 (54) (53)
Profit for the period 6 4,565 4,524
Attributable to:
Shareholders of the Company 4,348 4,311
Owners of perpetual capital securities 219 219
Non-controlling interests (2) (6)
4,565 4,524
Earnings per share 7 HK$1.73 HK$1.71
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the six months ended 30th June
Unaudited
HK$ million 2025 2024
Profit for the period 4,565 4,524
Other comprehensive income
Items that may be reclassified subsequently to profit or loss:
Loss from fair value changes of derivatives designated as effective cash flow (48) (15)
hedges
(Loss)/Gain from fair value changes of derivatives designated as effective net (3,702) 617
investment hedges
Exchange differences on translation of financial statements of foreign 7,041 (1,339)
operations
Share of other comprehensive income of associates 850 16
Share of other comprehensive (expense)/income of joint ventures (229) 425
Income tax relating to components of other comprehensive income 199 (158)
4,111 (454)
Items that will not be reclassified to profit or loss:
Share of other comprehensive income/(expense) of associates 34 (286)
Share of other comprehensive income/(expense) of joint ventures 248 (1,153)
Income tax relating to components of other comprehensive income (60) 335
222 (1,104)
Other comprehensive income/(expense) for the period 4,333 (1,558)
Total comprehensive income for the period 8,898 2,966
Attributable to:
Shareholders of the Company 8,678 2,755
Owners of perpetual capital securities 219 219
Non-controlling interests 1 (8)
8,898 2,966
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
HK$ million Notes Unaudited Audited
30/6/2025
31/12/2024
Property, plant and equipment 2,997 2,914
Investment properties 389 389
Interests in associates 39,000 38,068
Interests in joint ventures 112,040 102,148
Other financial assets 1,565 1,539
Derivative financial instruments 897 1,281
Goodwill and intangible assets 2,160 2,025
Deferred tax assets 2 1
Total non-current assets 159,050 148,365
Inventories 150 113
Derivative financial instruments 7 522
Debtors and prepayments 9 694 732
Bank balances and deposits 4,721 8,105
Total current assets 5,572 9,472
Bank and other loans 511 4,602
Derivative financial instruments 2,148 393
Creditors, accruals and others 10 5,237 6,137
Taxation 50 66
Total current liabilities 7,946 11,198
Net current liabilities (2,374) (1,726)
Total assets less current liabilities 156,676 146,639
Bank and other loans 20,195 14,639
Derivative financial instruments 496 2
Deferred tax liabilities 503 461
Other non-current liabilities 247 294
Total non-current liabilities 21,441 15,396
Net assets 135,235 131,243
Representing:
Share capital 11 2,520 2,520
Reserves 122,751 118,760
Equity attributable to shareholders of the Company 125,271 121,280
Perpetual capital securities 9,885 9,885
Non-controlling interests 79 78
Total equity 135,235 131,243
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the six months ended 30th June, 2025
Attributable to shareholders of the Company
HK$ million Share Share Contributed Property Hedging Exchange Retained Sub-total Perpetual Non- Total
capital
premium
surplus
revaluation
reserve
translation
profits
capital
controlling
reserve
reserve
securities
interests
At 1st January, 2025 (audited) 2,520 16,185 6,062 68 1,835 (9,789) 104,399 121,280 9,885 78 131,243
Profit for the period - - - - - - 4,348 4,348 219 (2) 4,565
Loss from fair value changes of derivatives designated as effective cash flow - - - - (48) - - (48) - - (48)
hedges
Loss from fair value changes of derivatives designated as effective net - - - - - (3,702) - (3,702) - - (3,702)
investment hedges
Exchange differences on translation of financial statements of foreign - - - - - 7,038 - 7,038 - 3 7,041
operations
Share of other comprehensive (expense)/income of associates - - - - (380) 1,230 34 884 - - 884
Share of other comprehensive (expense)/income of joint ventures - - - - (229) - 248 19 - - 19
Income tax relating to components of other comprehensive income - - - - 199 - (60) 139 - - 139
Total comprehensive (expense)/income for the period - - - - (458) 4,566 4,570 8,678 219 1 8,898
Dividend paid - - - - - - (4,687) (4,687) - - (4,687)
Distribution paid on perpetual capital securities - - - - - - - - (219) - (219)
At 30th June, 2025 (unaudited) 2,520 16,185 6,062 68 1,377 (5,223) 104,282 125,271 9,885 79 135,235
Attributable to shareholders of the Company
HK$ million Share Share Contributed Property Hedging Exchange Retained Sub-total Perpetual Non- Total
capital
premium
surplus
revaluation
reserve
translation
profits
capital
controlling
reserve
reserve
securities
interests
At 1st January, 2024 (audited) 2,520 16,185 6,062 68 1,620 (7,011) 103,849 123,293 9,885 93 133,271
Profit for the period - - - - - - 4,311 4,311 219 (6) 4,524
Loss from fair value changes of derivatives designated as effective cash flow - - - - (15) - - (15) - - (15)
hedges
Gain from fair value changes of derivatives designated as effective net - - - - - 617 - 617 - - 617
investment hedges
Exchange differences on translation of financial statements of foreign - - - - - (1,337) - (1,337) - (2) (1,339)
operations
Share of other comprehensive income/(expense) of associates - - - - 186 (170) (286) (270) - - (270)
Share of other comprehensive income/(expense) of joint ventures - - - - 425 - (1,153) (728) - - (728)
Income tax relating to components of other comprehensive income - - - - (158) - 335 177 - - 177
Total comprehensive income/(expense) for the period - - - - 438 (890) 3,207 2,755 219 (8) 2,966
Dividend paid - - - - - - (4,661) (4,661) - (3) (4,664)
Distribution paid on perpetual capital securities - - - - - - - - (219) - (219)
At 30th June, 2024 (unaudited) 2,520 16,185 6,062 68 2,058 (7,901) 102,395 121,387 9,885 82 131,354
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
for the six months ended 30th June
Unaudited
HK$ million Notes 2025 2024
Net cash from operating activities 12a 586 641
Net cash from investing activities 12b 920 443
Net cash utilised in financing activities (4,890) (4,981)
Net decrease in cash and cash equivalents (3,384) (3,897)
Cash and cash equivalents at 1st January 8,105 13,077
Cash and cash equivalents at 30th June 4,721 9,180
NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
The consolidated interim financial statements are prepared in accordance with
Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the
Hong Kong Institute of Certified Public Accountants ("HKICPA") and
International Accounting Standard 34 "Interim Financial Reporting" issued by
the International Accounting Standards Board ("IASB"), as well as the
applicable disclosure requirements of the Rules Governing the Listing of
Securities on The Stock Exchange of Hong Kong Limited ("Hong Kong Stock
Exchange").
The accounting policies adopted for the preparation of the consolidated
interim financial statements are consistent with those set out in the Group's
consolidated annual financial statements for the year ended 31st December,
2024, except for adoption of the amendments to HKFRS Accounting Standards
issued by the HKICPA and IFRS Accounting Standards issued by the IASB, which
are effective to the Group for accounting periods beginning on 1st January,
2025. The adoption of those amendments to HKFRS Accounting Standards and IFRS
Accounting Standards has no material impact on the Group's results and
financial position for the current or prior periods and does not result in any
significant change in accounting policies of the Group.
2. TURNOVER
Turnover represents net sales of infrastructure materials, interest income
from loans granted to associates and joint ventures, sales of waste management
services and share of turnover of joint ventures. Sales of infrastructure
materials and waste management services were substantially recognised at a
point in time.
Turnover comprises both sales and interest income from infrastructure
investments and share of turnover of joint ventures as follows:
Six months ended
30th June
HK$ million 2025 2024
Sales of infrastructure materials 722 751
Interest income from loans granted to associates 37 52
Interest income from loans granted to joint ventures 515 698
Sales of waste management services 935 977
Sales and interest income from infrastructure investments 2,209 2,478
Share of turnover of joint ventures 18,150 16,612
Turnover 20,359 19,090
3. OTHER INCOME
Other income includes the following:
Six months ended
30th June
HK$ million 2025 2024
Bank interest income 152 303
4. OPERATING COSTS
Operating costs include the following:
Six months ended
30th June
HK$ million 2025 2024
Cost of inventories sold 629 702
Cost of services provided 395 425
Depreciation of property, plant and equipment 148 149
Amortisation of intangible assets 8 9
5. TAXATION
Taxation is provided for at the applicable tax rates on the estimated
assessable profits less available tax losses. Deferred taxation is provided on
temporary differences under the liability method using tax rates applicable to
the Group's operations in different countries.
Six months ended
30th June
HK$ million 2025 2024
Current taxation - Hong Kong 1 1
Current taxation - outside Hong Kong 37 33
Deferred taxation 16 19
Total 54 53
6. PROFIT FOR THE PERIOD AND SEGMENT INFORMATION
for the six months ended 30th June
Infrastructure Investments
Investment in United Kingdom Australia Continental Hong Kong Canada New Zealand Total before Unallocated Consolidated
Power Assets
Europe
and Mainland
unallocated
items
Holdings
China
items
Limited
HK$ million 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024 2025 2024
Turnover - - 10,515 9,094 3,258 3,507 2,716 2,361 1,350 1,477 1,326 1,410 1,194 1,241 20,359 19,090 - - 20,359 19,090
Sales and interest income from infrastructure investments - - 182 212 225 327 109 110 722 751 36 101 935 977 2,209 2,478 - - 2,209 2,478
Bank interest income - - - - - - - - 24 33 - - 1 2 25 35 127 268 152 303
Other income - - - - - - - - 28 24 - - 2 3 30 27 - 17 30 44
Depreciation and amortisation - - - - - - - - (57) (51) - - (99) (106) (156) (157) - (1) (156) (158)
Other operating expenses - - - - - - - - (693) (766) - - (735) (782) (1,428) (1,548) (243) (212) (1,671) (1,760)
Finance costs - - - - - - - - - - - - (44) (54) (44) (54) (388) (361) (432) (415)
Exchange (loss)/gain - - - - - - - - - (4) - - - - - (4) 71 112 71 108
Share of results of associates and joint ventures 1,095 1,082 2,041 1,653 568 537 323 309 74 105 280 242 35 49 4,416 3,977 - - 4,416 3,977
Profit/(Loss) before taxation 1,095 1,082 2,223 1,865 793 864 432 419 98 92 316 343 95 89 5,052 4,754 (433) (177) 4,619 4,577
Taxation - - - - - - - - (2) (2) (41) (42) (15) (9) (58) (53) 4 - (54) (53)
Profit/(Loss) for the period 1,095 1,082 2,223 1,865 793 864 432 419 96 90 275 301 80 80 4,994 4,701 (429) (177) 4,565 4,524
Attributable to:
Shareholders of the Company 1,095 1,082 2,223 1,865 793 864 432 419 98 96 275 301 80 80 4,996 4,707 (648) (396) 4,348 4,311
Owners of perpetual capital securities - - - - - - - - - - - - - - - - 219 219 219 219
Non-controlling interests - - - - - - - - (2) (6) - - - - (2) (6) - - (2) (6)
1,095 1,082 2,223 1,865 793 864 432 419 96 90 275 301 80 80 4,994 4,701 (429) (177) 4,565 4,524
Segment profit attributable to shareholders of the Company represents the
profit earned by each segment after the profit attributable to owners of
perpetual capital securities and non-controlling interests without allocation
of gains or losses from treasury activities, corporate overheads and other
expenses of the Group's head office.
7. EARNINGS PER SHARE
The calculation of earnings per share is based on the profit attributable to
shareholders of the Company of HK$4,348 million (2024: HK$4,311 million)
and on 2,519,610,945 shares (2024: 2,519,610,945 shares) in issue during the
interim period.
8. INTERIM DIVIDEND
The interim dividend declared by the Board of Directors is as follows:
Six months ended
30th June
HK$ million 2025 2024
Interim dividend of HK$0.73 per share (2024: HK$0.72 per share) 1,839 1,814
9. DEBTORS AND PREPAYMENTS
Included in debtors and prepayments are trade debtors of HK$237 million
(HK$250 million at 31st December, 2024) and their aging analysis is as
follows:
HK$ million 30/6/2025 31/12/2024
Less than 1 month 196 189
1 to 3 months 35 42
More than 3 months but less than 12 months 8 20
More than 12 months 10 8
Gross total 249 259
Loss allowance (12) (9)
Total after allowance 237 250
Trade with customers is carried out largely on credit, except for new
customers, residential customers of waste management services and customers
with unsatisfactory payment records, where payment in advance is normally
required. Invoices are normally due within 1 month of issuance, except for
certain well-established customers, where the terms are extended to 2 months,
and certain customers with disputed items, where the terms are negotiated
individually. Each customer has a maximum credit limit, which was granted and
approved by senior management in accordance with the laid-down credit review
policy and procedures.
10. CREDITORS, ACCRUALS AND OTHERS
Included in creditors, accruals and others are trade creditors of
HK$237 million (HK$236 million at 31st December, 2024) and their aging
analysis is as follows:
HK$ million 30/6/2025 31/12/2024
Current 116 132
1 month 59 56
2 to 3 months 29 15
Over 3 months 33 33
Total 237 236
11. SHARE CAPITAL
There were no movements in the share capital of the Company in the six months
ended 30th June, 2025.
12. NOTES TO CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
a) Funds from operations
Six months ended
30th June
HK$ million 2025 2024
Net cash from operating activities 586 641
Dividends received from associates 1,648 1,566
Dividends received from joint ventures 950 1,126
Funds from operations* 3,184 3,333
* Funds from operations represent net cash from operating
activities and dividends received from associates and joint ventures.
b) Net cash from investing activities include the following:
Six months ended
30th June
HK$ million 2025 2024
Investment in joint ventures (93) (1,377)
13. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS
Except for certain investments in securities which are stated at cost, the
carrying values of all financial assets and financial liabilities approximate
to their fair values.
The fair value of the Group's financial instruments and non-financial
instruments are grouped into Level 1 to 3 with reference to the observability
and significance of the inputs used in the valuation technique as follows:
Level 1: Quoted prices (unadjusted) in active markets for
identical assets or liabilities.
Level 2: Inputs other than quoted prices included within Level 1
that are observable for asset or liability, either directly (i.e. as prices)
or indirectly (i.e. derived from prices).
Level 3: Inputs for the asset or liability that are not based on
observable market data (unobservable inputs).
At 30th June, 2025, investment properties amounting to HK$389 million
(HK$389 million at 31st December, 2024) and unlisted investment in securities
amounting to HK$376 million (HK$350 million at 31st December, 2024) were
measured at fair value based on value inputs, other than quoted prices, that
are observable either directly or indirectly. Other investments amounting to
HK$1,189 million (HK$1,189 million at 31st December, 2024) were measured at
fair value based on value inputs that are not observable market data but
change of these value inputs to reasonable possible alternatives would not
have material effect on the Group's results and financial position.
Derivative financial instruments were measured at fair value based on value
inputs, other than quoted prices, that are observable either directly or
indirectly.
14. COMMITMENTS
The Group's capital commitments outstanding at 30th June, 2025 and not
provided for in the consolidated interim financial statements are as follows:
Contracted but not
provided for
HK$ million 30/6/2025 31/12/2024
Plant and machinery 193 198
Buildings 2 -
Other financial assets 59 91
Total 254 289
15. CONTINGENT LIABILITIES
The contingent liabilities of the Group are as follows:
HK$ million 30/6/2025 31/12/2024
Performance bond indemnities 145 144
Sub-contractor warranties 24 24
Total 169 168
16. COMPARATIVE FIGURES
Certain comparative figures have been reclassified to conform to the current
period's presentation.
17. REVIEW OF CONSOLIDATED INTERIM FINANCIAL STATEMENTS
The consolidated interim financial statements are unaudited, but have been
reviewed by the Audit Committee.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors confirm that to the best of their knowledge:
- the financial statements have been prepared in accordance with
Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the
Hong Kong Institute of Certified Public Accountants and International
Accounting Standard 34 "Interim Financial Reporting" issued by the
International Accounting Standards Board, as well as the applicable disclosure
requirements of the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited and gives a true and fair view of the assets,
liabilities, financial position and profit or loss of the Group; and
- this Interim Report 2025 includes a fair review of the
information required by:
- DTR 4.2.7R of the Disclosure Guidance and Transparency
Rules ("DTR") sourcebook of the UK's Financial Conduct Authority, being an
indication of important events that have occurred during the first six months
of the financial year ending 31st December, 2025 and their impact on the
condensed set of financial statements; and a description of the principal
risks and uncertainties for the remaining six months of the financial year;
and
- DTR 4.2.8R, being related party transactions that have taken
place in the first six months of the financial year ending 31st December,
2025, which have materially affected the financial position or performance of
the Group during that period; and any changes in the related party
transactions described in the 2024 Annual Report that could materially affect
the financial position or performance of the Group during the first six months
of the financial year ending 31st December, 2025.
On behalf of the Board
Victor T K LI
Chairman
13th August, 2025
DIRECTORS' INTERESTS AND SHORT POSITIONS IN SHARES, UNDERLYING SHARES AND
DEBENTURES
As at 30th June, 2025, the interests or short positions of the Directors and
chief executives of the Company in the shares, underlying shares and
debentures of the Company or any of its associated corporations (within the
meaning of Part XV of the Securities and Futures Ordinance ("SFO")) which
were notified to the Company and The Stock Exchange of Hong Kong Limited ("HK
Stock Exchange") pursuant to Divisions 7 and 8 of Part XV of the SFO
(including interests or short positions which they were taken or deemed to
have under such provisions of the SFO), or which were recorded in the register
required to be kept by the Company under Section 352 of the SFO, or which were
required, pursuant to the Model Code for Securities Transactions by Directors
of Listed Issuers set out in Appendix C3 to the Rules Governing the Listing
of Securities on the HK Stock Exchange ("Model Code"), to be notified to the
Company and HK Stock Exchange, were as follows:
(1) LONG POSITIONS IN SHARES
Number of Ordinary Shares/Share Stapled Units
Name of Company Name of Capacity Personal Family Corporate Other Total Approximate
Director
Interests
Interests
Interests
Interests
% of
Shareholding
Company Li Tzar Kuoi, Interest of child or spouse - 227,000 - 5,428,000 5,655,000 0.22%
Victor
& beneficiary of trusts
(Note 1)
Kam Hing Lam Beneficial owner 100,000 - - - 100,000 0.003%
CK Hutchison Holdings Limited Li Tzar Kuoi, Beneficial Owner, 220,000 405,200 2,572,350 1,162,632,010 1,165,829,560 30.43%
Victor
interest of child or
(Note 3)
(Note 2)
spouse, interest of
controlled corporations
& beneficiary of trusts
Kam Hing Lam Beneficial owner & 51,040 57,360 - - 108,400 0.002%
interest of child or
spouse
Fok Kin Ning, Interest of controlled - - 6,011,438 - 6,011,438 0.15%
Canning
corporation
(Note 9)
Frank John Sixt Beneficial owner 166,800 - - - 166,800 0.004%
Lan Hong Tsung, Beneficial owner 13,680 - - - 13,680 0.0003%
David
Lee Pui Ling, Beneficial owner 111,334 - - - 111,334 0.002%
Angelina
Number of Ordinary Shares/Share Stapled Units
Name of Company Name of Capacity Personal Family Corporate Other Total Approximate
Director
Interests
Interests
Interests
Interests
% of
Shareholding
CK Hutchison Holdings Limited (Cont'd) George Colin Beneficial owner, 85,361 16,771 - 833,868 936,000 0.02%
Magnus
interest of child or spouse
(Note 10)
& founder & beneficiary
of a discretionary trust
Man Ka Keung, Beneficial owner & 9,368 - - 527 9,895 0.0003%
Simon
interests held jointly
(Note 11)
Power Assets Holdings Limited Kam Hing Lam Interest of child or spouse - 100,000 - - 100,000 0.004%
Lee Pui Ling, Angelina Beneficial owner 8,800 - - - 8,800 0.0004%
HK Electric Investments and HK Electric Investments Limited Li Tzar Kuoi, Interest of controlled - - 5,170,000 2,700,000 7,870,000 0.08%
Victor
corporation &
(Note 5)
(Note 6)
beneficiary of trust
Kam Hing Lam Interest of child or spouse - 1,025,000 - - 1,025,000 0.01%
Fok Kin Ning, Interest of controlled - - 2,000,000 - 2,000,000 0.02%
Canning
corporation
(Note 9)
Lee Pui Ling, Beneficial owner 2,000 - - - 2,000 0.00002%
Angelina
Hutchison Telecommunications (Australia) Limited Fok Kin Ning, Beneficial owner & interest 4,100,000 - 1,000,000 - 5,100,000* 0.037%
Canning
of controlled corporation
(Note 9)
Frank John Sixt Beneficial owner 1,000,000 - - - 1,000,000* 0.007%
Hutchison Telecommunications Hong Kong Holdings Limited Li Tzar Kuoi, Interest of child or spouse, - 192,000 353,047,203 53,604,826 406,844,029 8.44%
Victor
interest of controlled
(Note 7)
(Note 8)
corporations &
beneficiary of trusts
Fok Kin Ning, Interest of controlled - - 1,202,380 - 1,202,380 0.024%
Canning
corporation
(Note 9)
Frank John Sixt Beneficial owner 255,000 - - - 255,000 0.005%
George Colin Beneficial owner & 13,201 132 - - 13,333 0.0002%
Magnus
interest of child or spouse
* In relation to a takeover offer made by Hutchison
Telecommunications (Amsterdam) B.V., an indirect wholly owned subsidiary of CK
Hutchison Holdings Limited, to acquire all ordinary shares in Hutchison
Telecommunications (Australia) Limited ("HTAL"), Mr. Fok Kin Ning, Canning and
Mr. Frank John Sixt tendered acceptance in respect of all the shares in which
they were interested and ceased to have any interest in the shares of HTAL on
9th July, 2025.
(2) LONG POSITIONS IN DEBENTURES
Amount of Debentures
Name of Company Name of Capacity Personal Family Corporate Other Total
Director
Interests
Interests
Interests
Interests
Cheung Kong Infrastructure Finance (BVI) Limited Li Tzar Kuoi, Interest of controlled - - US$10,000,000 - US$10,000,000
Victor
corporation
4.2% Guaranteed
4.2% Guaranteed
Perpetual
Perpetual
Capital
Capital
Securities
Securities
(Note 4)
Notes:
1. The discretionary beneficiaries of each of The Li Ka-Shing
Unity Discretionary Trust ("DT1") and another discretionary trust ("DT2") are,
inter alia, Mr. Li Tzar Kuoi, Victor, his wife and children, and Mr. Li Tzar
Kai, Richard. Each of the trustees of DT1 and DT2 holds units in The Li
Ka-Shing Unity Trust ("UT1") but is not entitled to any interest or share in
any particular property comprising the trust assets of the said unit trust. Li
Ka-Shing Unity Trustee Company Limited ("TUT1") as trustee of UT1 holds a
total of 5,428,000 shares of the Company.
The entire issued share capital of TUT1 and of the trustees of DT1 and DT2 are
owned by Li Ka-Shing Unity Holdings Limited ("Unity Holdco"). Mr. Li Ka-shing
and Mr. Li Tzar Kuoi, Victor are respectively interested in one-third and
two-thirds of the entire issued share capital of Unity Holdco. TUT1 is
interested in the shares of the Company by reason only of its obligation and
power to hold interests in those shares in its ordinary course of business as
trustee and, when performing its functions as trustee, exercises its power to
hold interests in the shares of the Company independently without any
reference to Unity Holdco or any of Mr. Li Ka-shing and Mr. Li Tzar Kuoi,
Victor as a holder of the shares of Unity Holdco as aforesaid.
By virtue of the above and as a director of the Company and a discretionary
beneficiary of each of DT1 and DT2, Mr. Li Tzar Kuoi, Victor is taken to have
a duty of disclosure in relation to the shares of the Company held by TUT1 as
trustee of UT1 under the SFO.
2. The 1,162,632,010 shares in CK Hutchison Holdings Limited ("CK
Hutchison") comprise:
(a) 1,005,817,044 shares held by TUT1 as trustee of UT1 together
with certain companies which TUT1 as trustee of UT1 is entitled to exercise or
control the exercise of one-third or more of the voting power at their general
meetings ("TUT1 related companies"). By virtue of being a director of the
Company and a discretionary beneficiary of each of DT1 and DT2 as described in
Note 1 above, Mr. Li Tzar Kuoi, Victor is taken to have a duty of disclosure
in relation to the said shares of CK Hutchison held by TUT1 as trustee of UT1
and TUT1 related companies under the SFO.
(b) 72,387,720 shares held by Li Ka-Shing Castle Trustee Company
Limited ("TUT3") as trustee of The Li Ka-Shing Castle Trust ("UT3") together
with certain companies which TUT3 as trustee of UT3 is entitled to exercise or
control the exercise of one-third or more of the voting power at their general
meetings ("TUT3 related companies"). The discretionary beneficiaries of each
of the two discretionary trusts ("DT3" and "DT4") are, inter alia, Mr. Li Tzar
Kuoi, Victor, his wife and children, and Mr. Li Tzar Kai, Richard. Each of the
trustees of DT3 and DT4 holds units in UT3 but is not entitled to any interest
or share in any particular property comprising the trust assets of the said
unit trust.
The entire issued share capital of TUT3 and of the trustees of DT3 and DT4 are
owned by Li Ka-Shing Castle Holdings Limited ("Castle Holdco"). Mr. Li
Ka-shing and Mr. Li Tzar Kuoi, Victor are respectively interested in one-third
and two-thirds of the entire issued share capital of Castle Holdco. TUT3 is
only interested in the shares of CK Hutchison by reason only of its obligation
and power to hold interests in those shares in its ordinary course of business
as trustee and, when performing its functions as trustee, exercises its power
to hold interests in the shares of CK Hutchison independently without any
reference to Castle Holdco or any of Mr. Li Ka-shing and Mr. Li Tzar Kuoi,
Victor as a holder of the shares of Castle Holdco as aforesaid.
By virtue of the above and as a director of the Company and a discretionary
beneficiary of each of DT3 and DT4, Mr. Li Tzar Kuoi, Victor is also taken to
have a duty of disclosure in relation to the said 72,387,720 shares of CK
Hutchison held by TUT3 as trustee of UT3 and TUT3 related companies under the
SFO.
(c) 84,427,246 shares held by a company controlled by Li Ka-Shing
Castle Trustee Corporation Limited as trustee of DT3.
3. The 2,572,350 shares in CK Hutchison comprise:
(a) 2,272,350 shares held by certain companies in which Mr. Li Tzar
Kuoi, Victor is entitled to exercise or control the exercise of one-third or
more of the voting power at their general meetings.
(b) 300,000 shares held by Li Ka Shing Foundation Limited ("LKSF"). By
virtue of the terms of the constituent documents of LKSF, Mr. Li Tzar Kuoi,
Victor may be regarded as having the ability to exercise or control the
exercise of one-third or more of the voting power at general meetings of LKSF.
4. Such interests are held by a company of which Mr. Li Tzar Kuoi,
Victor is entitled to exercise or control the exercise of one-third or more of
the voting power at its general meetings.
5. The 5,170,000 share stapled units in HK Electric Investments
and HK Electric Investments Limited ("HKEI") are held by LKSF. By virtue of
the terms of the constituent documents of LKSF, Mr. Li Tzar Kuoi, Victor may
be regarded as having the ability to exercise or control the exercise of
one-third or more of the voting power at general meetings of LKSF.
6. The 2,700,000 share stapled units in HKEI are held by TUT1 as
trustee of UT1. By virtue of being a director of the Company and a
discretionary beneficiary of each of DT1 and DT2 as described in Note 1
above, Mr. Li Tzar Kuoi, Victor is taken to have a duty of disclosure in
relation to the said 2,700,000 shares stapled units of HKEI held by TUT1 as
trustee of UT1 under the SFO.
7. The 353,047,203 shares in Hutchison Telecommunications Hong
Kong Holdings Limited ("HTHK") comprise:
(a) 2,519,250 shares held by certain companies in which Mr. Li Tzar
Kuoi, Victor is entitled to exercise or control the exercise of one-third or
more of the voting power at their general meetings.
(b) 350,527,953 shares held by LKSF. By virtue of the terms of the
constituent documents of LKSF, Mr. Li Tzar Kuoi, Victor may be regarded as
having the ability to exercise or control the exercise of one-third or more of
the voting power at general meetings of LKSF.
8. The 53,604,826 shares in HTHK comprise:
(a) 153,280 shares held by TUT3 as trustee of UT3. By virtue of
being a director of the Company and a discretionary beneficiary of each of DT3
and DT4 as described in Note 2(b) above, Mr. Li Tzar Kuoi, Victor is taken
to have a duty of disclosure in relation to the said 153,280 shares of HTHK
held by TUT3 as trustee of UT3 under the SFO.
(b) 53,451,546 shares held by TUT1 as trustee of UT1 together with a
company which TUT1 as trustee of UT1 is entitled to exercise or control the
exercise of one-third or more of the voting power at its general meetings
("TUT1 related company"). By virtue of being a director of the Company and a
discretionary beneficiary of each of DT1 and DT2 as described in Note 1
above, Mr. Li Tzar Kuoi, Victor is taken to have a duty of disclosure in
relation to the said 53,451,546 shares of HTHK held by TUT1 as trustee of UT1
and TUT1 related company under the SFO.
9. Such interests are held by a company which is equally owned by
Mr. Fok Kin Ning, Canning and his wife.
10. Such interests comprise 184,000 shares held by a company
controlled by a trust under which Mr. George Colin Magnus is a discretionary
beneficiary and 649,868 shares indirectly held by a trust of which Mr. George
Colin Magnus is the settlor and a discretionary beneficiary.
11. Such 527 shares are jointly held by Mr. Man Ka Keung, Simon and
his daughter.
Save as disclosed above, none of the Directors or chief executives of the
Company had, as at 30th June, 2025, any interests or short positions in the
shares, underlying shares and debentures of the Company or any of its
associated corporations (within the meaning of Part XV of the SFO) which
would have to be notified to the Company and HK Stock Exchange pursuant to
Divisions 7 and 8 of Part XV of the SFO (including interests or short
positions which they were taken or deemed to have under such provisions of the
SFO), or which were recorded in the register required to be kept by the
Company under Section 352 of the SFO, or which were required to be notified to
the Company and HK Stock Exchange pursuant to the Model Code.
INTERESTS AND SHORT POSITIONS OF SHAREHOLDERS
So far as is known to any Director or chief executive of the Company, as at
30th June, 2025, shareholders (other than Directors or chief executives of the
Company) who had interests or short positions in the shares or underlying
shares of the Company which would fall to be disclosed to the Company under
the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were
recorded in the register required to be kept by the Company under Section 336
of the SFO were as follows:
LONG POSITIONS OF SUBSTANTIAL SHAREHOLDERS IN THE SHARES OF THE COMPANY
Name Capacity Number of Total Approximate
Ordinary
% of
Shares
Shareholding
Hutchison Infrastructure Holdings Limited Beneficial owner 1,906,681,945 1,906,681,945 75.67%
Aspire Rich Limited Interest of controlled 1,906,681,945 1,906,681,945 75.67%
corporation
(Note i)
Robust Faith Limited Interest of controlled 1,906,681,945 1,906,681,945 75.67%
corporation
(Note i)
CK Hutchison Capital Securities (2) Limited Interest of controlled 1,906,681,945 1,906,681,945 75.67%
corporations
(Note ii)
CK Hutchison Capital Securities (3) Limited Interest of controlled 1,906,681,945 1,906,681,945 75.67%
corporations
(Note iii)
CK Hutchison Global Investments Limited Interest of controlled 1,906,681,945 1,906,681,945 75.67%
corporations
(Note iv)
CK Hutchison Holdings Limited Interest of controlled 1,906,681,945 1,906,681,945 75.67%
corporations
(Note v)
Notes:
i. This represents the same block of shares in the Company as
shown against the name of Hutchison Infrastructure Holdings Limited ("HIHL")
above. Since HIHL is equally controlled by Aspire Rich Limited ("Aspire Rich")
and Robust Faith Limited ("Robust Faith"), each of Aspire Rich and Robust
Faith is deemed to be interested in the same number of shares in which HIHL is
interested under the SFO.
ii. As Aspire Rich is wholly-owned by CK Hutchison Capital
Securities (2) Limited ("CK 2"), CK 2 is deemed to be interested in the same
number of shares in which Aspire Rich is deemed to be interested under the
SFO.
iii. As Robust Faith is wholly-owned by CK Hutchison Capital
Securities (3) Limited ("CK 3"), CK 3 is deemed to be interested in the same
number of shares in which Robust Faith is deemed to be interested under the
SFO.
iv. As CK 2 and CK 3 are wholly-owned by CK Hutchison Global
Investments Limited ("CK Global"), CK Global is deemed to be interested in the
same number of shares in which CK 2 and CK 3 are deemed to be interested under
the SFO.
v. As CK Global is wholly-owned by CK Hutchison Holdings Limited
("CK Hutchison"), CK Hutchison is deemed to be interested in the same number
of shares in which CK Global is deemed to be interested under the SFO.
Save as disclosed above, as at 30th June, 2025, the Company had not been
notified by any persons (other than Directors or chief executives of the
Company) who had interests or short positions in the shares or underlying
shares of the Company which would fall to be disclosed to the Company under
the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were
recorded in the register required to be kept by the Company under Section 336
of the SFO.
CORPORATE GOVERNANCE
The Board of Directors (the "Board") and the management of the Company are
committed to the maintenance of good corporate governance practices and
procedures of the Company and its subsidiaries (the "Group"). The Company
acknowledges that a good corporate governance framework is essential for
effective management, a healthy corporate culture, business growth and
shareholder value enhancement. The corporate governance principles of the
Company emphasise a quality Board, sound internal controls, and transparency
and accountability to all shareholders.
The Company has applied the principles and complied with all code provisions
and, where applicable, the recommended best practices of the Corporate
Governance Code (the "CG Code") as set out in Appendix C1 to the
Rules Governing the Listing of Securities ("HK Listing Rules") on The Stock
Exchange of Hong Kong Limited throughout the six months ended 30th June, 2025.
The Group adheres to high corporate governance standards and conducts its
businesses with ethics and integrity. The Group's vision, values and strategy
are inextricably linked to its purpose and business operations. In compliance
with the CG Code, the Company has adopted, and regularly reviews its
comprehensive set of corporate governance policies such as Anti-Fraud and
Anti-Bribery Policy, Anti-Money Laundering Policy, Employee Code of Conduct,
Policy on Handling of Confidential Information, Information Disclosure, and
Securities Dealing, and Whistleblowing Policy - Procedures for Reporting
Possible Improprieties. The Group maintains a robust corporate governance
framework and internal control systems to uphold its accountability with
support from internal and external auditors and other professional advisors.
(1) BOARD COMPOSITION AND BOARD PRACTICES
Accountable to the shareholders under the leadership of the Chairman, the
Board leads, directs and supervises the Company's affairs to enable the
long-term success of the Company. The Board is responsible for shaping and
monitoring the corporate culture, setting long-term strategic objectives,
policies and directions of the Company with appropriate focus on values
creation and risk management. The Board evaluates the Group's operating,
financial and sustainability performance and oversees the executive management
of the Company with the support of various standing committees, and ensures
the Company maintains effective communication with shareholders and
appropriate engagement with other key stakeholders.
As at 30th June, 2025, the Board consists of fifteen Directors, comprising
eight Executive Directors (including the Chairman, the Group Managing
Director, two Deputy Chairmen, the Deputy Managing Director, the Chief
Financial Officer and two Executive Directors), two Non-executive Directors
and five Independent Non-executive Directors. Two Alternate Directors have
been appointed. Throughout the six months ended 30th June, 2025 and up to the
date of this Interim Report, one-third of the members of the Board are
Independent Non-executive Directors and more than one of them have appropriate
professional qualifications, or accounting or related financial management
expertise. All Directors (including Non-executive Directors) are subject to
retirement by rotation at least once every three years. Retiring Directors are
eligible for re-election by shareholders at general meetings in accordance
with the Company's Bye-laws and the CG Code.
The positions of Chairman and Group Managing Director are held by separate
individuals. The Chairman determines the broad strategic direction of the
Group in consultation with the Board and is responsible for the high-level
oversight of management. The Group Managing Director, with the support of the
Executive Directors, is responsible for the strategic planning of different
business functions and the day-to-day management and operations of the Group.
The Chairman encourages and solicits opinions from the Directors and urges for
Directors' active contribution to the Board's affairs, and takes the lead to
ensure that the Board acts in the best interest of the Company. The Chairman
promotes a culture of openness and a constructive relationship between
Executive and Non-executive Directors, and encourages Directors with different
views to voice their concerns. The Chairman allows sufficient time for
discussion of issues and ensures that Board decisions fairly reflect Board
consensus. Led by the Chairman, the Board and the management of the Company
have taken appropriate steps to facilitate effective communication with
shareholders and engagement with other stakeholders, and have put in place
good corporate governance practices and procedures. In addition, the two
meetings held every year between the Chairman and Independent Non-executive
Directors without the presence of other Directors provide an exclusive
platform for Independent Non-executive Directors to raise concerns, exchange
views and discuss issues about the Company or its business, such as corporate
governance enhancement, efficiency of the Board and any other matters they may
wish to discuss without the presence of the Executive Directors and the
management.
Reporting to the Chairman, the Company Secretary advises the Board on
corporate governance and other regulatory compliance matters and is
responsible for keeping the Board abreast of developments in the law, rules
and regulations that may affect the Company's business and operations. The
Company Secretary also assists the Board in monitoring the Company's
compliance with Board procedures and the requirements under the HK Listing
Rules, the relevant Listing Rules of the UK's Financial Conduct Authority
("UK Listing Rules") following the Company's secondary listing on the main
market for listed securities of London Stock Exchange plc ("London Stock
Exchange") in August 2024 and other applicable law, rules and regulations.
(2) CODE FOR SECURITIES TRANSACTIONS BY DIRECTORS
The Company has adopted a code for securities transactions in terms
substantially the same as Appendix C3 to the HK Listing Rules ("Code"). In
light of the secondary listing of the Company in the UK, the Code was updated
with the relevant requirements set out in Regulation (EU) No. 596/2014 as it
forms part of domestic law by virtue of the European Union (Withdraw)
Act 2018. The Code is reviewed and revised by the Company to reflect any
amendments to Appendix C3 to the HK Listing Rules and the above mentioned
relevant laws and regulations from time to time.
All Directors have confirmed that they have complied with the required
standards set out in the Code regarding their dealings in securities of the
Company during the six months ended 30th June, 2025.
The Board has established written guidelines no less exacting than the Code
for relevant employees in respect of their dealings in the Company's
securities. The Company has adopted a policy on handling of confidential
information, information disclosure, and securities dealing, applicable to the
Group's employees when they are in possession of confidential or inside
information in relation to the Group. The policy satisfies the requirements
under Part XIVA of the Securities and Futures Ordinance and the HK Listing
Rules. The Policy also satisfies the UK Listing Rules, the UK Disclosure
Guidance and Transparency Rules and the UK Market Abuse Regulation and other
applicable laws and regulations following the Company's secondary listing on
the main market for listed securities of London Stock Exchange in August 2024.
The policy is available on the Company's intranet and disseminated to the
employees.
(3) RISK MANAGEMENT AND INTERNAL CONTROLS
Internal Audit, reporting directly to the Audit Committee and the Group
Managing Director, performs independent assessments of the risk management and
internal control systems. Using a risk based methodology, Internal Audit
prepares its audit plan in consultation with, but independent of, management,
and it is reviewed by the Audit Committee. The audit work focuses on those
areas of the Group's activities with the greatest perceived risks. Ad hoc
reviews will also be performed on areas of concern identified by the Audit
Committee and management. Management of individual business units will be
informed of the areas for improvement, and Internal Audit will closely monitor
the implementation of agreed corrective actions.
The Board, through the Audit Committee, has conducted a review of the
effectiveness of the risk management and internal control systems of the Group
for the six months ended 30th June, 2025.
(4) AUDIT COMMITTEE
The Audit Committee comprises four members, all of whom are Independent
Non-executive Directors, with more than one of the members possessing
appropriate professional qualifications, or accounting or related financial
management expertise. The Audit Committee is chaired by Mr. Paul Joseph Tighe
with Mr. Cheong Ying Chew, Henry, Mrs. Sng Sow-mei alias Poon Sow Mei and Mr.
Lan Hong Tsung, David as members. The Audit Committee is responsible for
overseeing the Company's financial reporting system, risk management and
internal control systems, monitoring the integrity of the Group's financial
information, overseeing the relationship with the external auditor of the
Company, reviewing the arrangements that the Company's employees may use, in
confidence and anonymity, to raise concerns about possible improprieties and
ensuring proper arrangements are in place for fair and independent
investigations and follow-up actions, and performing corporate governance
functions delegated by the Board.
The Group's interim report for the six months ended 30th June, 2025 have been
reviewed by the Audit Committee.
(5) REMUNERATION COMMITTEE
A majority of the members of the Company's Remuneration Committee are
Independent Non-executive Directors. The Remuneration Committee is chaired by
Mr. Cheong Ying Chew, Henry, an Independent Non-executive Director, with
another Independent Non-executive Directors, Mrs. Sng Sow-mei alias Poon Sow
Mei and the Chairman of the Board, Mr. Victor T K Li as members. The principal
responsibilities of the Remuneration Committee include making recommendations
to the Board on the Company's policy and structure for the remuneration
packages of all Directors and the senior management, making recommendations on
the remuneration of Non-executive Directors and, with delegated
responsibility, determining the remuneration packages of individual Executive
Directors and senior management, with reference to the corporate goals and
objectives of the Board resolved from time to time.
(6) NOMINATION COMMITTEE
A majority of the members of the Company's Nomination Committee are
Independent Non-executive Directors. The Nomination Committee is chaired by
Mrs. Kwok Eva Lee, an Independent Non-executive Director, with another
Independent Non-executive Director, Mr. Cheong Ying Chew, Henry and the
Chairman of the Board, Mr. Victor T K Li as members. The principal
responsibilities of the Nomination Committee include reviewing the structure,
size and composition (including the skills, knowledge, experience and
diversity profile) of the Board at least annually, assisting the Board in
maintaining a Board skills matrix, accessing the independence of the
Independent Non-executive Directors, making recommendations to the Board on
the appointment or re-appointment of Directors and succession planning for
Directors, reviewing and accessing each Director's time commitment and
contribution to the Board as well as the Director's ability to discharge his
or her responsibilities effectively, supporting the regular evaluation of the
performance of the Board, and reviewing the Director Nomination Policy and the
Board Diversity Policy of the Company periodically.
(7) SUSTAINABILITY COMMITTEE
The Sustainability Committee comprises three Directors, a majority of whom are
Independent Non-executive Directors, and the Company Secretary. The
Sustainability Committee is chaired by Mr. Ip Tak Chuen, Edmond, Deputy
Chairman. Other members include two Independent Non-executive Directors, Mr.
Lan Hong Tsung, David and Mr. Paul Joseph Tighe, and the Company Secretary,
Ms. Eirene Yeung. The principal responsibilities of the Sustainability
Committee include overseeing management and advising the Board on the
development and implementation of the sustainability initiatives of the Group.
To discharge these responsibilities, the Sustainability Committee reviews the
related sustainability and ESG policies and practices, and assesses and makes
recommendations on matters concerning the Group's sustainability development,
and sustainability and ESG risks and opportunities.
(8) INVESTOR RELATIONS AND SHAREHOLDERS ENGAGEMENT
The Company's Shareholders Communication Policy is available on the Company's
website. The policy is subject to review on a regular basis to ensure its
implementation and effectiveness.
The Company commits to engaging stakeholders in ongoing dialogues to
understand their evolving needs, concerns and expectations. The Company
establishes different forms of engagement for different groups of stakeholders
to keep consistent interactions and maintains different communication channels
for shareholders and investors to communicate their views on matters regarding
the Company's businesses and affairs. These channels include (i) corporate
communications(Note 1) published on the websites of the Company and the Hong
Kong Exchanges and Clearing Limited with notice of availability of corporate
communications to be distributed to shareholders(Note 2) by email or by post
(where applicable) (and, in case of actionable corporation
communications(Note 3), further disseminated to shareholders in accordance
with the HK Listing Rules); (ii) general meetings which provide a forum for
shareholders to raise comments and exchange views with the Board;
(iii) updated and key information regarding the Group available on the
website of the Company; (iv) the Company's website which offers a
communication platform between the Company and its shareholders and
stakeholders; (v) press conferences and briefing meetings with analysts held
from time to time, where applicable, to provide updates on the performance of
the Group; (vi) the Company's Branch Share Registrar who deals with
shareholders for share registration and related matters; (vii) the Corporate
Affairs Department of the Company handling enquiries from shareholders and
investors generally; and (viii) other dedicated communication channels,
activities and events operated or organised by designated business units and
departments at various levels engaging different groups of stakeholders.
Notes:
1. "Corporate Communications" refers to any documents issued or to
be issued by the Company for the information or action of holders of any of
the Company's shares or securities or the investing public, including but not
limited to directors' reports, annual accounts and auditor's reports, interim
reports, notices of meetings, listing documents, circulars and proxy forms.
2. "Shareholders", for the purpose of this section, include holder
of the shares in or other securities of the Company.
3. "Actionable Corporate Communications" refer to any Corporate
Communications that seek instructions from Shareholders on how they wish to
exercise their rights or made an election as Shareholders.
OTHER INFORMATION
PURCHASE, SALE OR REDEMPTION OF LISTED SECURITIES
During the six months ended 30th June, 2025, neither the Company nor any of
its subsidiaries had purchased, sold or redeemed any of the Company's listed
securities (including sale of treasury share). As at 30th June, 2025, the
Company and its subsidiaries did not hold any treasury shares whether in the
Central Clearing and Settlement System, or otherwise.
DISCLOSURE UNDER CHAPTER 13 OF THE HK LISTING RULES
The following information is disclosed in accordance with Rule 13.22 of
Chapter 13 of the HK Listing Rules:
As at 30th June, 2025, the Group's financial assistance to certain affiliated
companies exceeded the assets ratio of 8 per cent. A combined statement of
financial position of the affiliated companies as at 30th June, 2025 is set
out below:
HK$ million
Non-current assets 532,512
Current assets 27,966
Current liabilities (52,914)
Non-current liabilities (311,648)
Net assets 195,916
Share capital 54,665
Reserves 140,705
Non-controlling interests 546
Total equity 195,916
As at 30th June, 2025, the consolidated attributable interest of the Group in
these affiliated companies amounted to HK$86,741 million.
RISK FACTORS
The Group's businesses, financial condition, results of operations and growth
prospects may be affected by risks and uncertainties directly or indirectly
pertaining to the Group's businesses. The risk factors set out below are those
that could result in the Group's businesses, financial condition, results of
operations or growth prospects differing materially from expected or
historical results. Such factors are by no means exhaustive or comprehensive,
and there may be other risks in addition to those shown below which are not
known to the Group or which may not be material now but could turn out to be
material in the future. In addition, this Interim Report does not constitute a
recommendation or advice to invest in the shares or other securities of the
Company and investors are advised to make their own judgement or consult their
own investment advisors before making any investment in the shares or other
securities of the Company.
GLOBAL ECONOMY
Heightened trade tensions and policy uncertainty, fluctuation of major
currencies, supply chain disruptions, diverging fiscal policy and monetary
policy, fluctuation of commodity prices and energy costs, continuing
geopolitical tensions and increasing climate risks have created uncertainties
and volatility in the global economy and financial markets. Continued slowdown
in global economic growth could lead to economic contractions in certain
markets, commercial and consumer delinquencies, weakened consumer confidence,
increased market volatility and decline in the value of the assets.
The Group is a diversified infrastructure investment company with businesses
presently in Hong Kong, Mainland China, the United Kingdom ("UK"), Continental
Europe, Australia, New Zealand, Canada and the United States. Any adverse
economic, social and/or political conditions in those countries and places in
which the Group operates may potentially impact on the Group's businesses,
financial condition, results of operations, asset values and liabilities.
ECONOMIC CONDITIONS AND INTEREST RATES
The industries in which the Group operates are affected by the economic
conditions of the various places where the Group's investments or operations
are located, the population growth of these places, mark to market value of
investment securities, the currency environment and interest rate cycles.
There can be no assurance that the combination of the above factors the Group
experiences in the future will not adversely affect its businesses, financial
condition, results of operations or growth prospects.
The interest rate cycle has impact on the aggregate demand from all sectors,
which may in turn affect the businesses of the Group. While the Group
regularly reviews its exposure to interest rate fluctuations and may manage
such exposure using hedging instruments, there can be no guarantee that the
Group will not be affected by the interest rate exposure.
In particular, certain businesses of the Group are subject to regulatory
regimes in which local interest rates are taken into account in the
calculation of the regulated cost of capital, which flows through to allowed
revenue. There can be no assurance that any changes in the regulated cost of
capital can be fully mitigated by the businesses. Furthermore, income from
finance and treasury operations is dependent upon the capital markets,
interest rate and currency environment, and the worldwide economic and market
conditions, and therefore there can be no assurance that changes in these
conditions will not adversely affect the Group's businesses, financial
condition, results of operations or growth prospects. The volatility in the
financial markets may also adversely affect the income to be derived by the
Group from its finance and treasury activities.
CONCENTRATION IN GEOGRAPHICAL MARKETS AND BUSINESS TYPES
The business operation of the Group may be viewed as substantially
concentrated in certain geographical markets or in one particular or more
types of business. If and when the Group's operations are exposed to any
deterioration in the economic, social or political conditions as well as any
incidence of social unrest, strike, riot, civil disturbance or disobedience or
terrorism, or even outbreaks of epidemics in such geographical markets or
business segments, the adverse circumstances may materially disrupt the
Group's operations and, in turn, impact the revenue, profitability and
financial condition of the Group.
HIGHLY COMPETITIVE MARKETS
Unlike the Group's regulated businesses, which do not experience significant
competition, some of the Group's non-regulated business, such as the Group's
waste management, off-airport car parking, rolling stock leasing, cement and
household infrastructure businesses, face competition across the diverse
markets in which they operate. New market entrants and intensified price
competition among existing market players could adversely impact the Group's
businesses, financial condition, results of operations or growth prospects.
Competition risks faced by the Group include (a) possible restrictions on the
access by the shuttle buses operated by the Group's off-airport car parking
businesses as imposed by the airport authorities that operates the on-airport
car parking businesses; (b) the availability of rail link services from city
centre to airport which may reduce the usage of the off-airport car park; and
(c) significant competition and pricing pressure from other competitors
attempting to capture a higher level of market share. Such risks may adversely
affect the Group's businesses, financial condition, results of operations or
growth prospects.
INFRASTRUCTURE MARKET
The Group has historically focused, and continues to focus, its portfolio on
regulated businesses in the power and infrastructure sectors. The
infrastructure market is highly regulated. Some of the investments owned by
the Group in the power and infrastructure sectors (for example, water, gas and
electricity) are subject to regulatory pricing and strict adherence must be
made to the licence requirements, codes and guidelines established by the
relevant regulatory authorities from time to time. Failure to comply with
these licence requirements, codes or guidelines may lead to penalties, or, in
extreme circumstances, amendment, suspension or cancellation of the relevant
licences by the authorities. Interest and inflation rates, high energy cost,
energy windfall tax, cap on the energy retail prices in certain markets as
well as tougher stances adopted by regulators may affect the returns of the
Group's infrastructure businesses. Any operational practices that are
significantly out of step with community expectations can lead to concerns
with regulators or local or national governments, and may ultimately lead to
more stringent regulatory resets, regulatory oversight as well as negative
publicity that could also have a reputational impact.
The distribution and transmission networks of the Group's utilities
investments are also exposed to supply interruptions. If an extreme weather
and climate event, earthquake, storm, flood, fire, sabotage, terrorist attack,
outbreaks of epidemics or any other unplanned event interrupts service, the
loss of cash flow resulting from the interruption and the cost of recovery
from network damage could be considerable and potentially cause poor customer
perceptions and may also lead to claims and litigation. Moreover, some losses
from events such as terrorist attacks may not be recoverable. The
Russia-Ukraine conflict and the instability in the Middle East may continue to
impact energy supply at risk and cause price volatility. Increases in the
number or duration of supply interruptions could result in material increases
in the costs associated with the operation of the distribution and
transmission networks. The capacity factor (load factor) of the wind farms
acquired by the Group could also be affected by the wind conditions, which
could result in the fluctuation of revenues. Some investments in non-regulated
business may also be impacted by regulatory reform. All of these uncertain
factors could have a material adverse effect on the businesses, financial
condition, results of operations or growth prospects of the Group.
CRUDE OIL MARKETS
The Group's investment in Husky Midstream Limited Partnership ("HMLP")
comprises oil pipelines, storage facilities and ancillary assets in Canada.
Its results of operation and financial condition may be dependent on the
prices received for refined products and crude oil of Cenovus Energy Inc.
("Cenovus"). Fluctuation of crude oil prices could impact the value and
quantity of Cenovus' oil production. HMLP also has other customers apart from
Cenovus and their demand for HMLP's services may depend on prices received for
their refined products and crude oil. Prices for refined products and crude
oil are based on local and global supply and demand as well as availability
and costs of transportation. Supply and demand may be affected by a number of
factors including, but not limited to, actions taken by the Organisation of
the Petroleum Exporting Countries (OPEC), non-OPEC crude oil supply, social
and political conditions in oil producing countries, the occurrence of natural
disasters, general and specific economic conditions, technological
developments, prevailing weather patterns and the availability of alternate
sources of energy. Furthermore, HMLP is also susceptible to unforeseen
pipeline releases at rivers or nature reserves. If the above events occurred
or further occurred, it may adversely affect the Group's financial condition
and results of operations.
CAPEX INVESTMENT
Capex investment plans for regulated business are proposed and planned based
on the asset conditions, regulatory compliance and government initiative, such
as net zero emission and hydrogen plan. Aggressive targets could require huge
capital investment in a short period of time. That would cause concerns
on: affordability of the customers for the increase in tariff; construction
is constrained by the availability of labour and supplies. Excess demand would
further drag up capital investment project costs, which might cause cost of
funding not being able to be justified by the weighted average cost of capital
(WACC) return allowed by the regulator.
A significant amount of capital expenditure is also required for the Group to
maintain the assets of its existing businesses. While the relevant asset
companies have their own asset management plans, there is a risk that due to
unforeseen events, capital expenditure required for the replacement of assets
could exceed budgeted amounts and hence affect the businesses, financial
condition, results of operations or growth prospects of the Group.
CURRENCY FLUCTUATIONS
The Group is a global infrastructure group and is exposed to potential
currency fluctuations in these countries and territories in which the Group
operates, particularly with respect to U.S. dollars, Hong Kong dollars,
Australian dollars, New Zealand dollars, British pounds sterling, Canadian
dollars and Euros. The results of the Group are recorded in Hong Kong dollars
but its various subsidiaries, associates and joint ventures may receive
revenue and incur expenses in other currencies. Any currency fluctuations on
translation of the accounts of these subsidiaries, associates and joint
ventures and also on the repatriation of earnings, equity investments and
loans may therefore impact the Group's financial condition, results of
operations, asset values or liabilities.
To minimise currency risk exposure in respect of its investments in other
countries, the Group generally hedges those investments with (i) currency
swaps and (ii) an appropriate level of borrowings denominated in the local
currencies. The Group has not entered into any speculative derivative
transaction.
Although currency exposures have been managed by the Group, a depreciation or
fluctuation of the currencies in which the Group conducts operations relative
to the Hong Kong dollar could adversely affect the Group's businesses,
financial condition, results of operations or growth prospects.
CYBERSECURITY
With the rapid expansion of internet, networking, information and operational
technology, coupled with swift development of artificial intelligence (AI)
technology, the incidence and severity of cyber fraud, cyber attacks and
security breaches are escalating globally. As the Group's businesses focus on
power and infrastructure sectors, they could be particularly prone to cyber
attacks and security breaches due to their structural importance. The Group's
critical utility, data and information assets are not immune from attack,
damage or unauthorised access. Cybersecurity risks could significantly impact
the operational and business performance, as well as the business reputation
of the Group. The Group continuously strives to enhance the cybersecurity
protection of its businesses.
There can be no assurance that the Group will be free from cyber fraud, cyber
attacks or security breaches or that it will not experience any major damage
to its assets or activities. Cyber fraud, cyber attacks or security breaches
suffered by the Group's systems could result in significant impact on the
Group's business reputation, businesses, financial condition, results of
operations or growth prospects. As threats related to cyber security develop
and grow, the Group and its businesses may also find it necessary to make
further investments to enhance cybersecurity, which may impact the Group's
results of operations and financial condition.
LABOUR
The labour markets in which the Group operates are experiencing significant
short and long term structural changes. Unemployment rates are low and people
are prioritising work-life balance. There is a significant uncertainty in
labour availability and cost. High turnover rates are presenting challenges in
recruitment, training and development. There is no assurance that the
situation will improve in the near future. The turnover of key personnel may
impact the Group's businesses stability, performance and operations.
SUPPLY CHAIN DISRUPTIONS
Geopolitical tensions have disrupted supply of raw materials, transportation
and port operations. This has resulted in escalating costs, unpredictable lead
time and quality issues, combined with widespread shortages of shipping
availability. Additionally, the increase in energy and oil prices has added
complexity to the disruption. Global disruptions have impacted domestic supply
chains. Specific domestic issues include shortage of labour which is
particularly acute in some areas where the Group operates. There is no
assurance that the situation will improve in the near future.
STRATEGIC PARTNERS
Certain businesses of the Group are conducted through non-wholly owned
subsidiaries, associates, internal joint ventures, and, to a lesser extent,
external joint ventures in which the Group shares control and strategic
alliances have been formed by the Group with strategic or business partners.
There can be no assurance that any of the external strategic or business
partners will maintain their relationships with the Group. The Group may not
be able to pursue its stated strategies with respect to its non-wholly owned
subsidiaries, associates and joint ventures. Furthermore, the joint venture
partners may (a) have economic or business interests or goals that are
inconsistent with those of the Group; (b) take actions contrary to the
Group's policies or objectives; (c) undergo a change of control;
(d) experience financial and other difficulties; or (e) be unable or
unwilling to fulfill their obligations under the joint ventures, which may
affect the Group's businesses, financial condition, results of operations or
growth prospects.
IMPACT OF POSSIBLE ECONOMIC SANCTIONS ON BUSINESS PARTNERS, SUPPLIERS,
CUSTOMERS OR BUSINESSES IN GENERAL
Governments and multinational organisations (including but not limited to the
State Department and the Department of the Treasury's Office of Foreign Assets
Control of the United States, His Majesty's Treasury, the Office of Financial
Sanctions Implementation or other UK government agency, the European Union
("EU") or any member state thereof and the United Nations), from time to time
administer certain laws and regulations that impose restrictions with respect
to activities, transmission of funds or transactions with certain countries,
governments, entities and individuals that are the subject of economic
sanctions. There can be no assurance that such sanctions or other restrictions
will not affect the jurisdictions in which the Group conducts its business,
any of the Group's business partners, suppliers, customers or otherwise. To
the extent that any such sanction or restriction is imposed in any
jurisdictions where the Group's business operates, the Group may need to cease
operations in those jurisdictions and suffer losses in that regard. If any of
the Group's business partners or suppliers are impacted by sanctions or
restrictions, provision of goods, services or support by them may be disrupted
or discontinued, which may affect the Group's ability to continue to operate
related businesses. If any of the Group's business partners are affected by
sanctions or restrictions, the discontinuation or disruption of strategic
alliances with such business partners may also affect the Group's ability to
continue to operate related businesses and/or may result in suspension of
operations. There can be no assurance that the Group will be able to obtain
alternative goods, services, support or alliance it needs for the operation of
its business, in a timely manner or at competitive terms, and no assurance
that any compensation recoverable from business partners or suppliers for the
discontinued or disrupted supply, service, support or alliance will be
available or adequate. If any of the Group's customers are affected by
sanctions or restrictions, the Group may be forced to discontinue the
provision of services or goods to such customers and the Group will suffer
losses in that regard. If any of the Group's assets are in the possession of
such customers, there can be no assurance that such assets can be repossessed
by the Group especially if such assets are located in countries or regions
subject to sanctions or restrictions and no assurance that any compensation
recoverable from such customers or insurers for the Group's failure to
repossess such assets will be available. Any of these factors could have a
material adverse effect on the Group's financial condition and results of
operations.
MERGERS, ACQUISITIONS AND DISPOSALS
The Group has undertaken significant merger and acquisition activities in the
past, and as part of its strategic growth plans, expects to continue to do so
in the future if there are appropriate acquisition opportunities in the
markets. In pursuit of new business opportunities, the Group is experiencing
more intense competition where competing bidders are more aggressive in the
valuation of the assets on the back of abundant market liquidity and lower
return requirements, and a willingness to take market risk. Even for assets
where there is a bid/ask spread between buyers and sellers, many sellers still
have holding power and often decide to continue to hold the assets rather than
sell below their reserve price. Although due diligence and detailed analyses
will be conducted in advance, there can be no assurance that these can fully
expose all hidden problems, potential liabilities and unresolved disputes that
the target company may have. In addition, valuations and analyses on the
target company conducted by the Group or by professionals alike are based on
numerous assumptions, and there can be no assurance that those assumptions are
correct or appropriate or that they will receive universal recognition.
Relevant facts and circumstances used in the analyses could have changed over
time, and new facts and evolving circumstances may come to light as to render
the previous assumptions and the valuations and analyses based thereon
obsolete.
Merger and acquisition, and disposal transactions are typically subject to
negotiations and agreements to be entered into, and even if final agreements
are entered into, may still be subject to merger, anti-trust, national
security, foreign investment, foreign subsidy and other regulatory approvals
by the competent authorities which may only approve the transactions subject
to conditions, or prohibit the transactions. There can be no assurance that
any such transactions or proposals will proceed, or any such approvals or
other conditions would be obtained or satisfied and even if such approvals are
obtained, third parties may initiate proceedings to appeal against such
approvals. If a proposed transaction does not proceed or is prohibited, or the
relevant approvals are revoked, and the transaction cannot be completed, the
Group will have incurred significant expenses, such as legal, accounting and
other costs in connection with the transaction, without realising its
anticipated benefits, such as increased earnings, scale, competitive strength
and market share. There might be longer and more complicated foreign
investment approval processes in particular for "critical" infrastructure
assets such as electricity and gas networks, and assets that handle data.
Geopolitical tensions and trade protectionism have accelerated these trends as
governments have responded with additional foreign investment regulations to
protect local enterprises from foreign acquisitions and also to protect
strategic assets from foreign control. The Group may not necessarily be able
to successfully integrate the target business into the Group and may not be
able to derive any synergy from the acquisition, leading to an increase in
costs, time and resources. For merger, acquisition and disposal activities
undertaken overseas, the Group may also be exposed to different and changing
political, social, legal and regulatory requirements at the local, national
and international levels. The Group may also need to face different cultural
issues when dealing with local employees, customers, governmental authorities
and pressure groups.
IMPACT OF LOCAL, NATIONAL AND INTERNATIONAL REGULATIONS
The local business risks in different countries and territories in which the
Group operates could have a material impact on the businesses, financial
condition, results of operations or growth prospects. The Group has
investments in different countries and territories around the world and the
Group is, and may increasingly become, exposed to different and changing
political, social, legal, tax, regulatory and environmental requirements at
the local, national or international level. Also, new guidelines, directives,
policies or measures by governments, whether fiscal, tax, regulatory,
environmental or other competitive changes, may lead to an increase in
additional or unplanned operating expenses and capital expenditures, increase
in market capacity, reduction in government subsidies, may pose a risk to the
overall investment return of the Group's businesses and may delay or prevent
the commercial operation of a business, which may result in loss of revenue
and profits and adversely affect the Group's businesses, financial condition,
results of operations or growth prospects.
Political, regulatory and media attention has increased significantly towards
privatised companies in countries in which the Group operates. Regulators in
some of these countries have warned of increasingly onerous regulatory resets,
and some major political parties are promoting policies to bring energy, water
and railways back into public ownership, which could potentially have serious
and material consequences for the Group if such regulations and policies are
enacted. Group companies are responding to these risks by focusing on their
core strategies of delivering and outperforming regulatory outputs such as
safety, reliability and customer service, at the lowest cost possible; by
conveying the positive benefits to customers of the services they provide; and
by engaging collaboratively with regulators and politicians to demonstrate the
advantages of private ownership.
COMPLIANCE WITH PERSONAL DATA PROTECTION LEGISLATION
In the ordinary course of its operations, various businesses of the Group
collect, store and use data that is protected by personal data protection laws
in the different countries in which they operate. As regulatory focus on
privacy issues continues to increase and worldwide laws and regulations
concerning the handling of personal information expand and become more
complex, potential risks related to personal data collection and use within
the Group's businesses are expected to intensify.
In the event that any relevant business of the Group is unable to meet its
obligations under applicable data protection laws, it may be subject to
regulatory actions or civil claims. The expenses on remediation, costs of
regulatory or legal actions, and monetary damages and/or reputational damage
suffered as a result of such actions could have a material adverse effect on
the Group's financial condition and results of operations.
HEALTH AND SAFETY LAWS AND REGULATIONS
Many aspects of the Group's businesses and their operations are inherently
dangerous, such as the operation and maintenance of electricity generation and
distribution businesses, and gas transmission and distribution businesses
which have the potential to trigger operational hazards. In addition, certain
operational aspects of the Group's businesses that are not currently regarded
or proven to have adverse effects could be later found to be hazardous, such
as the operations effected by electric and magnetic fields.
The Group's businesses are subject to laws and regulations governing health
and safety matters to protect both the public, employees and contractors, who
could potentially be harmed by these activities, as well as laws and
regulations relating to pollution, the protection of the environment, and the
use and disposal of hazardous substances and waste materials, which are all
subject to change in the future. Any breach of these obligations, or even
incidents that do not amount to a breach could adversely affect the Group's
results of operations and reputation.
ENVIRONMENTAL REGULATIONS
The Group is required to comply with numerous laws and regulations relating to
the protection of the environment and land use in the UK, Australia, New
Zealand, Continental Europe, Canada, Hong Kong, Mainland China and elsewhere.
These laws and regulations may change over time.
The Group believes that it and its businesses have obtained all material
environmental approvals currently required to operate their facilities.
However, the Group and its businesses may incur significant additional costs
as a result of current and future environmental regulations and requirements
to obtain approvals. In addition, there can be no assurance that the
requirements to obtain such approvals may not become more stringent in the
future and that such approvals would be renewed when they expire. Furthermore,
there is a risk that some environmental agencies may seek to retroactively
alter certain permitting conditions, particularly in cases where certain
practices were established and agreed upon in principle but were not
documented.
In addition, the Group's businesses may be significantly impacted by evolving
environmental regulations and decarbonisation efforts in the countries where
they operate.
Failure to comply with environmental laws and regulations could result in the
imposition of civil or criminal liabilities, the imposition of liens or fines
and additional expenditures to bring the facilities into compliance, which
would have a material adverse effect on the Group's businesses, financial
condition, results of operations or growth prospects.
IMPACT OF NEW ACCOUNTING STANDARDS
The International Accounting Standards Board has from time to time issued a
number of new and revised IFRS Accounting Standards. The International
Accounting Standards Board may in the future issue new and revised standards
and interpretations. In addition, interpretations on the application of the
IFRS Accounting Standards will continue to develop. These factors may require
the Group to adopt new accounting policies. The adoption of new accounting
policies or new IFRS Accounting Standards might or could have a significant
impact on the Group's financial position or results of operations.
CONNECTED TRANSACTIONS
CK Hutchison Holdings Limited ("CK Hutchison") is also listed on The Stock
Exchange of Hong Kong Limited ("HK Stock Exchange"). Although the Group
believes that its relationship with CK Hutchison provides it with significant
business advantages, any transactions entered into between the Group and CK
Hutchison, its subsidiaries or associates are connected transactions under the
Rules Governing the Listing of Securities on the HK Stock Exchange ("HK
Listing Rules"), which, unless one of the exemptions is available, will be
subject to compliance with the applicable requirements of the HK Listing
Rules, including the issuance of announcements, the obtaining of independent
shareholders' approval at general meetings and disclosure in annual reports
and financial statements. Independent shareholders' approval requirements may
also lead to unpredictable outcomes causing disruption to as well as increase
in the risks of the Group's business activities. Independent shareholders may
also take actions that are in conflict with the interests of the Group.
RISKS ARISING FROM CLIMATE CHANGE
Some of the Group's assets and businesses, and many of the Group's customers
and suppliers are located in areas that would be affected in the medium to
long term by climate change. Climate change may increase the frequency and
intensity of extreme weather events, and some of which can result in natural
disasters. It could disrupt supply chains, interrupt business operations and
cause financial and physical damages. Alteration in weather patterns, such as
typhoons, droughts, or rainfall amount may cause shortage of crops for food
and other natural resources. The harsher temperatures in some locations may
also pose an increased risk for staff working in those locations. Changes in
microclimates for certain locations may render certain businesses obsolete.
The Group and its businesses are also increasingly subject to regulations in
relation to climate change. While the Group commits significant expenditure
towards complying with these laws and regulations, the cost of future
environmental obligations is often inherently difficult to estimate. If
additional and more onerous requirements are imposed or the Group or its
businesses are less able to recover additional costs imposed, the Group's
businesses, financial condition and results of operations may be materially
and adversely affected. Some governments are also introducing legislation or
requirements to restrict emissions and other environmental protective
measures. Some regulators have issued mandatory disclosure requirements in
relation to climate-related financial risk disclosures. Regulations, new
disclosure requirements, disruption and damage arising from climate change
could have a material impact on the Group's businesses and adversely affect
the Group's financial condition and results of operations.
There can be no assurance that climate change and its impact including rising
sea levels, prolonged droughts, heat waves, severe storms or flooding and
other extreme weather patterns will not occur and result in major disruption
or damage to the Group's assets and businesses, which could materially and
adversely affect the Group's businesses, financial condition, results of
operations and growth prospects.
TRANSITION RISKS
Pressure on businesses to support the transition to low-carbon economic
systems is rising. In a low-carbon economy, emissions are minimised through
the use of low-carbon resources, while resource efficiency is maximised by the
reduction of wasteful and high-emissions consumption. Infrastructure
businesses faced significant pressure from regulatory, legal, market,
technological, and reputational risks generated by the transition which could
have a material impact on the Group's businesses and adversely affect the
Group's financial condition and results of operations. For example, additional
legal and/or regulatory measures imposing limitation on GHG emissions or
efficiency improvements, may results in potential litigation, operation
restriction and significant compliance cost.
NATURAL DISASTERS
Some of the Group's assets and projects, and many of the Group's customers and
suppliers are located in areas at risk of damage from earthquakes, floods,
storms, drought, bushfires, frost and similar disasters and the occurrence of
any of these disasters could disrupt the Group's businesses and materially and
adversely affect the Group's businesses, financial condition, results of
operations or growth prospects.
There can be no assurance that earthquakes, floods, storms, drought,
bushfires, extreme weather or other natural disasters will not occur and
result in major damage to the Group's infrastructure projects, utility assets
or facilities, or to the general supporting infrastructure facilities in the
vicinity, which could adversely affect the Group's businesses, financial
condition, results of operations or growth prospects.
REPUTATIONAL RISKS
The Group's portfolio is primarily comprised of regulated businesses, and
maintaining trust in the Group is critical to its ability to maintain strong
relationships with the relevant regulators as well as investors and employees.
Damage to the Group's reputation can therefore cause significant harm to its
businesses and prospects. The Group also has strategic alliances with its
affiliated companies, and the Group's reputation could also be harmed by the
failure of an affiliate, a vendor or other third parties with which it does
business, to comply with laws or regulations.
In addition, any failure or perceived failure of any of the Group's portfolio
businesses to deliver appropriate standards of service and quality or to
handle or use confidential information appropriately can result in user or
regulators' dissatisfaction, litigation and heightened regulatory scrutiny,
all of which can lead to lost turnover, higher operating costs and harm to the
Group's and its businesses' reputation. Adverse publicity or negative
information posted on social media regarding the Group or its businesses,
whether or not true, may result in reputational harm, and have a material
adverse effect on the Group's businesses and prospects. Should any of these or
other events or factors that can undermine the Group's reputation occur, there
is no assurance that the additional costs and expenses that it may need to
incur to address the issues giving rise to the reputational harm could not
adversely affect its businesses and results of operations.
PUBLIC HEALTH EMERGENCY
Although COVID-19 no longer constitutes a public health emergency of
international concern, there can be no assurance that there will not be
another significant global outbreak of a severe communicable disease, and if
such an outbreak were to occur, it could have an adverse impact on the
operations of the Group and its results of operations might suffer. The
potential impact on the Group's businesses, financial condition, results of
operations or growth prospects will depend on a range of factors, including
the duration, severity and scope of the pandemic, the impact of the pandemic
on economic activity globally, the possibility of resurgence and variants, and
the measures adopted by governments.
POTENTIAL RISKS IN RELATION TO WITHDRAWAL OF THE UK FROM EUROPEAN UNION'S
MEMBERSHIP ("BREXIT")
The UK left the EU on 31st January, 2020. The Trade and Cooperation Agreement
between the UK and the EU, which was signed on 30th December, 2020 and applied
provisionally as from 1st January, 2021, entered into force on 1st May, 2021.
It sets out preferential arrangements in various aspects such as trade,
security, areas on ongoing collaboration/cooperation and governance. Brexit
may continue to create uncertainty about the new economic and social
partnership between the UK and the EU, and has impacted trade intensity,
labour availability, supply chain, exchange rates and the gross domestic
product levels in the UK.
SOCIAL INCIDENTS, TERRORIST THREATS AND GEOPOLITICAL TENSIONS
The Group is a diversified infrastructure investment company with businesses
presently in Hong Kong, Mainland China, the UK, Continental Europe, Australia,
New Zealand, Canada and the United States. In recent years, a series of social
incidents, terrorist activities and geopolitical tensions occurred across the
globe that resulted in economic losses, multiple deaths, casualties,
persistent supply chain disruptions and volatility in commodity markets. There
can be no assurance that countries in which the Group operates will not have
any social incidents or they will be immune from terrorist threats or
geopolitical tensions, and if these events occur, they may have an adverse
impact on the Group's businesses, financial condition, results of operations
or growth prospects.
DIVIDENDS
Since its listing on the HK Stock Exchange in 1996, the Company has grown its
dividends in each of the past 29 years. However, the Company's track record of
dividend payment may not continue in the future. The Company's principal
assets consist of its ownership stakes in its operating portfolio businesses.
The Company's ability to pay dividends and fulfil its obligations depends,
among other factors, on the ability of its portfolio businesses to distribute
dividends, repay intercompany loans provided by the Company or extend
intercompany loans to the Company. The Group's portfolio businesses are
subject to regulations that may limit the amount of dividends, loans or
advances they may make to the Company.
In addition, the Company's ability to pay dividends may be constrained by
business considerations, such as the impact of dividends on the Company's
credit ratings or competitive position. Furthermore, as a Bermuda incorporated
company and under the Bye-laws, the Company may not declare or pay a dividend,
or make a distribution out of contributed surplus, if there are reasonable
grounds for believing that (i) the Company is, or would after the payment be,
unable to pay its liabilities as they become due or (ii) the realisable value
of its assets would thereby become less than the aggregate of its liabilities
and its issued share capital and share premium account.
DUAL LISTING OF THE COMPANY'S SHARES
Dual listing of the Company's shares on HK Stock Exchange and the London Stock
Exchange plc ("LSE") may lead to an inefficient market in the shares as it
results in differences in liquidity, settlement and clearing systems, trading
currencies, prices and transaction costs between HK Stock Exchange and LSE.
These and other factors can hinder the transferability of the shares between
the two exchanges.
The Company's shares are quoted and traded in Hong Kong dollars on HK Stock
Exchange. The shares will be quoted and traded in British pounds sterling on
LSE. The market price of the shares on those exchanges may also differ due to
exchange rate fluctuations.
Consequently, the trading in, and liquidity of, the Company's shares will be
split between these two exchanges. The characteristics of the Hong Kong and UK
capital markets are different. HK Stock Exchange and LSE have different
trading hours, trading characteristics (including trading volume and
liquidity), trading and listing rules, market regulations, and investor bases.
As a result of these differences, the price of the shares may fluctuate and
may at any time be different on HK Stock Exchange and LSE, even allowing for
currency differences. This could adversely affect the trading of the shares on
these exchanges and increase their price volatility and adversely affect the
price and liquidity of the shares on these exchanges.
PAST PERFORMANCE AND FORWARD LOOKING STATEMENTS
The past performance and the results of operations of the Group as contained
in this Interim Report are historical in nature and past performance can be no
guarantee of future results of the Group. This Interim Report may contain
forward-looking statements and opinions that involve risks and uncertainties.
Actual results may differ materially from expectations discussed in such
forward-looking statements and opinions. Neither the Group nor the directors,
employees or agents of the Group assume (a) any obligation to correct or
update the forward-looking statements or opinions contained in this Interim
Report; and (b) any liability in the event that any of the forward-looking
statements or opinions does not materialise or turns out to be incorrect.
This interim report 2025 (both English and Chinese versions) ("Interim
Report") has been published on the Company's website (https://www.cki.com.hk)
and the website of Hong Kong Exchanges and Clearing Limited
(https://www.hkexnews.hk) with notice of availability distributed to
shareholders by email (if shareholders have provided a valid email address) or
by post (if shareholders have not provided an email address or the email
address is invalid). A copy of the English version has also been submitted to
the National Storage Mechanism and will shortly be available for inspection at
https://data.fca.org.uk//nsm/nationalstoragemechanism.
If a shareholder wishes to receive the Company's corporate communications
(including but not limited to the Interim Report) from the Company in printed
form, please follow the instructions set out in the "Dissemination of
Corporate Communications" section under "Investor Information" on the
Company's website, to complete the relevant Request Form and return the
completed form to the Company's Branch Share Registrar, Computershare Hong
Kong Investor Services Limited.
Any such request from a shareholder will cease to be valid after one year, or
such shorter period if the original request is revoked in writing, or
superseded by a subsequent written request, by such shareholder, prior to the
expiry date of the original request. A shareholder wishing to continue to
receive corporate communications in printed form after expiry of the original
request must complete and return a fresh Request Form.
Shareholders may at any time choose to change their choice as to the language
of the Company's corporate communications (including but not limited to the
Interim Report) by reasonable prior notice in writing to the Company c/o the
Company's Branch Share Registrar by email to cki.ecom@computershare.com.hk or
by post to 17M Floor, Hopewell Centre, 183 Queen's Road East, Hong Kong.
Shareholders who have requested receiving the Company's corporate
communications in printed form in either English or Chinese version will
receive both English and Chinese versions of the Interim Report since both
language versions are bound together into one booklet.
In order to receive actionable corporate communications by email, shareholders
are also requested to follow the relevant instructions set out in the
"Dissemination of Corporate Communications" section under "Investor
Information" on the Company's website, to complete the relevant Request Form
and return the completed form to the Company's Branch Share Registrar,
Computershare Hong Kong Investor Services Limited.
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. END IR GCGDICUDDGURRecent news on CK Infrastructure Holdings
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