REG - Hongkong Land Hldgs Jardine Matheson Hdg - Interim Management Statement

Hongkong Land HoldingsAnnouncement

10/11/2022 09:45

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RNS Number : 9937F  Hongkong Land Hldgs Ltd  10 November 2022

Announcement

 

The following announcement was issued today to a Regulatory Information
Service approved by the Financial Conduct Authority in the United Kingdom.

 

HONGKONG LAND HOLDINGS LIMITED

Interim Management Statement

 

10th November 2022 - Hongkong Land Holdings Limited today issues an Interim
Management Statement for the third quarter of 2022.

 

The Group's underlying profit in the third quarter was lower than the same
period in 2021.  Trading continued to be affected by anti-pandemic measures
taken across China, with contracted sales in the Development Properties
business particularly impacted.  The contribution from Investment Properties
was broadly unchanged compared to the same period last year.

 

In Hong Kong, the Group's Central office portfolio benefitted from its unique
positioning, despite an increase in vacancies across the city in the period.
Physical vacancy at 30th September 2022 decreased to 5.1%, compared to 5.4% at
the end of June 2022.  On a committed basis, vacancy was 4.8%.  Vacancy for
the overall Central Grade A office market was 8.3% at the end of September
2022.  Rental reversions continued to be negative in the period, at a level
largely in line with the first half of the year.  Leasing activity has
softened in recent months compared to the first half of 2022, due to global
economic headwinds, although the Group has already secured new leases for
almost all tenancies expiring in the remainder of the year.

 

The Group's LANDMARK retail portfolio in Hong Kong benefitted from marginally
better trading conditions in the third quarter of the year, due to a
relaxation of social distancing restrictions in the city.  This resulted in a
decline in temporary rent relief in the period, although the Group continued
to provide support to its tenants on a case-by-case basis.  Overall
performance, however, continues to be negatively impacted by a lack of
overseas visitors.  Tenant sales were lower than in the same period in
2021.  Physical and committed vacancy at 30th September 2022 remained low at
1.4%.

 

Leasing sentiment in the Group's office portfolio in Singapore remained
healthy, despite a more challenging global economic outlook.  Rental
reversions were positive in the period.  Physical vacancy decreased to 4.0%
at 30th September 2022, from 4.7% at the end of June 2022.  On a committed
basis, vacancy was 0.7%.

 

In Development Properties, market sentiment in respect of residential
properties on the Chinese mainland remained weak, due to pandemic-related
restrictions and an uncertain economic outlook.  The Group's attributable
interest in contracted sales was US$346 million in the third quarter, compared
to US$258 million in the equivalent period in 2021, mainly due to the timing
of sales launches.  In the nine months to 30th September 2022, the Group's
attributable interest in contracted sales was US$765 million, compared to
US$1,618 million in the same period last year.

 

In Singapore, residential market sentiment remained stable, as sales
performance at the Group's existing projects continued to be satisfactory.
In October 2022, the Group launched Copen Grand, a 639-unit executive
condominium in the Tengah region, which was 73% sold on its launch weekend.
The Group's attributable interest in contracted sales in the city was US$56
million in the period, compared to US$88 million in the equivalent period in
2021.  In the nine months to 30th September 2022, the Group's attributable
interest in contracted sales was US$326 million, compared to US$260 million in
the same period last year.  It is too early to assess the impact of the
cooling measures introduced in September 2022.

 

In August 2022, the Group secured a joint venture project in Suzhou to develop
and operate a commercial mixed-used site, consisting of a luxury mall and a
hotel.  The total developable area of the site is 132,600 sq. m. and it is
expected to be completed in 2026.

 

The Group's full year underlying profits are expected to be significantly
lower than the prior year, primarily due to a lower number of planned sales
completions and the impact of pandemic-related restrictions on construction
activities on the Chinese mainland, which will result in some completions
being deferred from the second half of 2022 into 2023.

 

The Group's financial position remains strong.  Net debt at 30th September
2022 decreased to US$5.8 billion from US$6.1 billion at the end of June
2022.  Committed liquidity was US$2.9 billion, compared to US$2.6 billion at
the end of June 2022.  55% of the Group's interest rate on debt is at fixed
rates.

 

Hongkong Land is a major listed property investment, management and
development group.  The Group owns and manages more than 850,000 sq. m. of
prime office and luxury retail property in key Asian cities, principally Hong
Kong, Singapore, Beijing and Jakarta.  The Group also has a number of
high-quality residential, commercial, and mixed-use projects under development
in cities across China and Southeast Asia, including a 43% interest in a 1.1
million sq. m. mixed-use project in West Bund, Shanghai.  Its subsidiary, MCL
Land, is a well-established residential developer in Singapore.  Hongkong
Land Holdings Limited is incorporated in Bermuda and has a primary listing in
the standard segment of the London Stock Exchange, with secondary listings in
Bermuda and Singapore.  The Group's assets and investments are managed from
Hong Kong by Hongkong Land Limited.  Hongkong Land is a member of the Jardine
Matheson Group.

 

- end -

 

 

For further information, please contact:

 

 Hongkong Land Limited
 Mark Lam               (852) 2842 8211
 Gary Leung             (852) 2842 0601

 

Brunswick Group Limited

 Nan Dong  (852) 9768 8379

 

This and other Group announcements can be accessed through the Internet at
'www.hkland.com'.

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