Presentation 4th March 2016
2015 Review Sound result in 2015 Continued strong performance from commercial portfolio Entry into Shanghai with prime mixed-use site Stable asset values 1
Highlights 2014 2015 US$930m Underlying profit attributable to shareholders US$905m US$397m Non-trading items US$1,107m US$1,327m Profit attributable to shareholders US$2,012m US 39.52 Underlying earnings per share US 38.44 US 56.42 Earnings per share US 85.50 US$11.71 NAV per share US$12.19 US 13.00 Final dividend per share US 13.00 US 19.00 Total dividend per share US 19.00 2
Commercial Property 3
Commercial Portfolio ( 000 sq. ft NFA) HKL s Share Office Retail Hotel Total Hong Kong 4,140 588 143 4,871 Macau - 93 151 244 Singapore 1,649 134-1,783 Jakarta 662 65-727 Hanoi 106 11-117 Bangkok 27 60-87 Others 71-312 383 TOTAL 6,655 951 606 8,212 4
Hong Kong 1. One Exchange Square 2. Two Exchange Square 3. Three Exchange Square 4. The Forum 5. Jardine House 6. Chater House 7. Alexandra House 9a 10 9 7 11 8 6 5 1 2 3 8. Gloucester Tower 9. Edinburgh Tower 12 4 9a. The Landmark Mandarin Oriental 10. York House 11. Landmark Atrium 12. Prince s Building 5
Hong Kong Central Grade A Office Rental Index Index 180 160 140 120 100 80 2011 2012 2013 2014 2015 Source: Jones Lang LaSalle 6
Hong Kong Central Grade A Office Market m sq. ft 2.5 2 1.5 1 0.5 0 New supply Net take up Vacancy Vacancy % 15 12 9 6 3 0-0.5 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 Source: Jones Lang LaSalle Disclaimer: The above forecast shall be regarded solely as a general guide. No representation is made nor responsibility accepted by Jones Lang LaSalle for the accuracy of the whole or any part whatsoever. 7
Hong Kong Grade A Office Market m sq. ft 10 8 6 4 2 0 New supply Net take up Vacancy Vacancy % 15 12 9 6 3 0-2 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 Source: Jones Lang LaSalle Disclaimer: The above forecast shall be regarded solely as a general guide. No representation is made nor responsibility accepted by Jones Lang LaSalle for the accuracy of the whole or any part whatsoever. 8
Hongkong Land Central Portfolio: Office 2013 2014 2015 Average Net Rent (HK$ psf/month) 99 102 101 Year-end Vacancy 5.0% 5.4% 3.4% Weighted Average Lease Expiry (years) 3.6 3.4 4.1 9
Hong Kong: Office Tenant Profile Property 5% Trading 2% Governments 1% Accounting 8% Others 14% Banks and other financial services 39% Legal 31% 10
Hong Kong: Expiration and Interim Rent Revisions 2016 2017 2018 Total lettable office area subject to expiration/rent revisions ( 000 sq. ft) 783 1,456 1,267 % of area subject to expiration/rent revisions 19% 35% 31% Average expiring net rent (HK$ psf/month) 104 104 100 11
Hongkong Land Central Portfolio: Retail 2013 2014 2015 Average Net Rent (HK$ psf/month) 201 214 221 Year-end Vacancy 0% 0% 0% Weighted Average Lease Expiry (years) 2.4 2.8 2.4 Note: Vacancy excludes areas under renovation. 12
Singapore One Raffles Link (100%-owned) One Raffles Quay (33%-owned) Marina Bay Financial Centre (33%-owned) 13
Singapore CBD Grade A Office Market m sq. ft 5 4 3 2 1 0 New supply Net take up Vacancy Vacancy % 15 12 9 6 3 0-1 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 CBD Raffles Place, Shenton Way, Marina Bay & Marina Centre Source: Jones Lang LaSalle Disclaimer: The above forecast shall be regarded solely as a general guide. No representation is made nor responsibility accepted by Jones Lang LaSalle for the accuracy of the whole or any part whatsoever. 14
Singapore Commercial Portfolio ( 000 sq. ft NFA) Office Retail Total HKL s Share One Raffles Link 239 73 312 312 One Raffles Quay 1,327 4 1,331 444 Marina Bay Financial Centre 2,904 179 3,083 1,027 TOTAL 4,470 256 4,726 1,783 15
Singapore: Office Tenant Profile Natural resources 8% Accounting 3% Others 9% Legal 6% Banks and other financial services 74% 16
Singapore: Office Average Rents and Vacancies 2013 2014 2015 Average Gross Rent (S$ psf/month) 9.1 9.2 9.5 Year-end Vacancy 1.7% 1.7% 3.0% Weighted Average Lease Expiry (years) 5.9 5.5 5.1 Note: According to local market practice, the average office rent includes management charges. 17
Singapore: Expiration and Interim Rent Revisions 2016 2017 2018 HKL s Share: Total lettable office area subject to expiration/rent revisions ( 000 sq. ft) 187 227 760 % of area subject to expiration/rent revisions 11% 14% 46% Average expiring rent (S$ psf/month) 11.4 9.0 9.1 Note: According to local market practice, the average office rent includes management charges. 18
Jakarta Jakarta Land (50%-owned) WTC 3 Existing portfolio features 135,000 sq. m. Average gross rent: US$25.3 psm per month (2014: US$24.0 psm per month) Occupancy: 93% WTC 3: Basement concrete works have been substantially completed (Completion: 2018) 19
Phnom Penh EXCHANGE SQUARE (100%-owned) Mixed-use complex of 30,000 sq. m. Heart of Phnom Penh Completion: late 2016 20
Beijing WF CENTRAL (90%-owned) Prestigious retail centre, which includes an exclusive luxury hotel 43,000 sq. m. lettable retail area Open: 1H 2017 21
Residential Property 22
Mainland China Completed Projects, Beijing Project Project Type Maple Place Maple Place (90%) Central Park (40%) 22 units handed over in 2015 39 units available for future sale, mostly leased 72 units of serviced apartments Central Park 23
Mainland China Development Projects Summary HKL s Share Project Interest Year of Acquisition Site Area (ha) Developable Area (m sq. m.) Constructed (m sq. m.) Under Construction (m sq. m.) Yorkville South, Chongqing 100% 2010 39 0.88 0.28 0.27 Yorkville North, Chongqing 100% 2011 54 1.09 0.21 0.20 Bamboo Grove, Chongqing 50% 2005 39 0.73 0.63 0.09 New Bamboo Grove, Chongqing 50% 2015 17 0.32 - - Landmark Riverside, Chongqing 50% 2009 11 0.50 0.13 0.17 Central Avenue, Chongqing 50% 2013 20 0.55-0.07 WE City, Chengdu 50% 2010 10 0.45 0.12 0.08 Parkville, Shanghai 50% 2015 4 0.11-0.05 Shenyang Projects 50% 2007 34 0.65 0.04 - TOTAL 228 5.28 1.41 0.93 24
Mainland China Parkville, Shanghai Yangjing, Pudong District (50%-owned) Site area: 87,180 sq. m. 227,000 sq. m. GFA Residential and commercial Completion: 2018 25
Mainland China New Bamboo Grove, Chongqing Dazhulin Area (50%-owned) Adjacent to Bamboo Grove Chongqing Int l Exhibition Centre Chongqing Central Park Chongqing Airport Site area: 348,000 sq. m. Central Avenue Project 640,000 sq. m. GFA Yorkville North Primarily residential Completion: 2022 Bamboo Grove Jiangbeizui Yorkville South Central Downtown CBD Jiefangbei CBD Background image from Google Earth Landmark Riverside 26
Mainland China Revenue Recognised US$m 900 800 700 600 500 400 300 200 100 0 Chongqing Chengdu Shenyang Beijing $621m $451m $505m 2013 2014 2015 Note: The above chart includes HKL s share of Joint Ventures & Associates. 27
Mainland China Contracted Sales US$m 900 800 700 600 500 400 300 200 100 0 Chongqing Chengdu Shanghai Shenyang Beijing $802m $632m $635m 2013 2014 2015 Note: The above chart includes HKL s share of Joint Ventures & Associates. 28
Mainland China Contracted Sales At 31st December 2015, US$821m (2014: US$533m) in sold but unrecognised contracted sales Some 70% of contracted sales scheduled to be recognised in 2016 29
Singapore Sol Acres Palms @ Sixth Avenue LakeVille Ripple Bay Jurong West J Gateway Hallmark Residences Marina Bay Suites 30
Singapore Completed Project Marina Bay Suites (33%-owned) Final 18 units sold 31
Singapore Completions in 2015 Project Units GFA ( 000 sq. ft) Sold Palms @ Sixth Avenue 32 109 100% Ripple Bay 679 672 100% Hallmark Residences 75 110 97% 32
Singapore Projects for Completion from 2016 Project Units GFA ( 000 sq. ft) Estimated Completion Date Pre-Sold J Gateway 738 576 2016 100% LakeVille 699 741 2017 81% Sol Acres (previously known as Choa Chu Kang Grove) 1,327 1,364 2018 25% Jurong West 710 537 2019 TOTAL 3,474 3,218 Not yet launched 33
Indonesia Nava Park, Greater Jakarta (49%-owned) JV with PT Bumi Serpong Damai Site area: 67 ha Southwest of central Jakarta 377 units launched for sale; 70% pre-sold Completion of Lancewood: 2016 34
Indonesia Anandamaya Residences (40%-owned) JV with Astra International 509 luxury apartments; 90% pre-sold Completion: 2018 35
Philippines Two Roxas Triangle (40%-owned) JV with Ayala Land 182 units; 91% pre-sold Completion: 2019 36
Philippines Mandani Bay (40%-owned) JV with Taft Property Site area: 20 ha 1.2 million sq. m. GFA Residential and commercial 37
Financial Results 38
Consolidated Profit and Loss Account (US$m) 2014 2015 1,876 Revenue 1,932 (809) Net operating costs (938) 1,067 Operating profit 994 123 Share of results of joint ventures 141 (69) Net financing charges (74) (187) Tax (151) (4) Non-controlling interests (5) 930 Underlying profit 905 397 Non-trading items 1,107 1,327 Profit attributable to shareholders 2,012 39
Revenue (US$m) 2014 2015 961 Commercial revenue 973 915 Residential revenue 959 1,876 Total 1,932 40
Underlying Profit by Business (US$m) 2014 2015 953 Commercial property 942 398 Residential property 354 (62) Corporate expenses (62) 1,289 1,234 (103) Net financing charges (107) (247) Tax (209) (9) Non-controlling interests (13) 930 Underlying profit 905 41
Commercial Property Underlying Profit (US$m) 2014 2015 Greater China 772 - Hong Kong 778 29 - Mainland China & Macau 21 Southeast Asia & Others 130 - Singapore 121 22 - Others 22 953 Total 942 42
Residential Property Underlying Profit (US$m) 2014 2015 Greater China 69 - Hong Kong 55 179 - Mainland China & Macau 173 Southeast Asia & Others 149 - Singapore 127 1 - Others (1) 398 Total 354 43
Consolidated Cash Flow (US$m) 2014 2015 699 Operating activities 896 88 Investing activities (146) (426) Financing activities (449) 7 Others 15 368 Decrease in net debt 316 (3,025) Net debt at beginning of year (2,657) (2,657) Net debt at end of year (2,341) 44
Operating Activities (US$m) 2014 2015 1,067 Operating profit excluding non-trading items 994 (81) Net interest paid (78) (134) Tax paid (175) (429) Payments for residential sites (281) (454) Development expenditure on residential projects (407) 962 Proceeds from residential sales 1,079 153 Dividends received from joint ventures 117 (385) Others (353) 699 896 45
Investing Activities (US$m) 2014 2015 (38) Major renovations capex (58) (216) Funding of joint ventures (256) 479 Advances and loan repayments from joint ventures 391 (137) Development expenditure (152) - Payment of deposit for a joint venture (71) 88 (146) 46
Consolidated Cash Flow (US$m) 2014 2015 699 Operating activities 896 88 Investing activities (146) Financing activities (421) - Dividends paid by the Company (445) (5) - Dividends paid to minority shareholders (4) (426) (449) 7 Others 15 368 Decrease in net debt 316 (3,025) Net debt at beginning of year (2,657) (2,657) Net debt at end of year (2,341) 47
Consolidated Balance Sheet (US$m) 2014 2015 Investment properties 23,697 - Subsidiaries 24,957 4,474 - Joint ventures 4,296 28,171 29,253 Properties held for sale 2,923 - Subsidiaries 2,714 1,372 - Joint ventures 1,771 4,295 4,485 (2,211) Others (2,677) 30,255 Gross assets (excluding cash) 31,061 Financed by: 27,598 - Total equity 28,720 2,657 - Net debt 2,341 30,255 31,061 48
Investment Property Basis of Valuation Capitalisation Rates 2014 1H 2015 2015 Hong Kong Office - Exchange Square 1 & 2 4.00% 4.00% 3.75% Hong Kong Retail - Landmark Atrium 4.50% 4.50% 4.50% Singapore Office - MBFC 3.75% 3.75% 3.75% Note: These capitalisation rates are provided on an indicative basis. 49
Investment Property Carrying Values (US$m) 2014 2015 Greater China 22,336 - Hong Kong 23,671 1,650 - Mainland China & Macau 1,532 Southeast Asia & Others 3,628 - Singapore 3,428 557 - Others 622 28,171 Total 29,253 Note: The analysis includes share of Joint Ventures & Associates. 50
Properties Held for Sale Carrying Values (US$m) 2014 2015 Greater China 23 - Hong Kong 18 2,435 - Mainland China & Macau 2,766 Southeast Asia & Others 1,696 - Singapore 1,528 141 - Others 173 4,295 4,485 (941) Pre-sale proceeds (1,187) 3,354 Net investment 3,298 Note: The analysis includes share of Joint Ventures & Associates. 51
Gross Assets at 31st Dec 2015 By Activity By Location Commercial 90% Residential 10% Hong Kong 75% Mainland China and Macau 11% Southeast Asia 14% 52
Treasury Management Summary 2014 2015 Net debt (US$m) 2,657 2,341 Gearing 10% 8% Average tenor of debt (years) 7.3 7.2 Average interest cost 2.9% 3.3% Credit ratings - S & P - Moody s A A3 A A3 53
Maturity Profile of Committed Facilities/Bonds (US$m) US$m 3,000 Bank Facilities (Drawn & Undrawn) Bonds * $2,931m 2,500 2,000 1,500 1,000 500 $570m $666m $1,104m $882m $298m 0 2016 2017 2018 2019 2020 2021+ * Includes bonds and notes issued under MTN Programme which are at face value. 54
Liquidity at 31st Dec 2015 (US$bn) 2014 HK$ 1 S$ 2 US$ RMB Total 7.2 Committed lines 4.7 1.2-0.5 6.4 4.3 Gross debt 3.2 0.5-0.2 3.9 2.9 Available lines 1.5 0.7-0.3 2.5 1.6 Cash - 0.2 0.5 0.9 1.6 4.5 Available liquidity 1.5 0.9 0.5 1.2 4.1 Notes: (1) HK$ debt includes US$ debt swapped into HK$. (2) S$ debt includes HK$ debt swapped into S$. 55
Outlook Solid trading profits from operations are expected to continue in 2016 Anticipated higher contribution from mainland China Underlying earnings in 2016 are anticipated to be lower overall The Group continues to seek opportunities to develop premium commercial and residential projects in Greater China and Southeast Asia 56
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