A Sustainable Vision for the Future
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World Financial Centre, Beijing A Sustainable Vision for the Future Sustainability may still be considered a choice for some, but unless we all reconsider our actions the choice will be made for us. Modern architecture should be beautiful, but it must also be environmentally responsible and respectful of its surroundings. Cesar Pelli Pelli Clarke Pelli Architects Dr The Honourable Lee Shau Kee, GBM Chairman and Managing Director Our approach as a Group is based on strong economic, social and environmental principles. We strive to create high quality, visually stimulating, innovative new homes and commercial developments that enhance, as well as integrate with, their surrounding natural and built environments. Chairman’s Statement Dear Shareholders, Included in the results for the year was total non-recurrent income of HK$938.0 million made up of the excess, amounting to On behalf of your Board, I am pleased to present my report on the HK$352.4 million, of the fair values of net assets comprised in the operations of the Group for the year ended 30 June 2007. companies acquired from Henderson Investment Limited during the year over the consideration paid, and the Group’s share of Overview gain of HK$585.6 million arising from the disposal of 10 piped-city Our approach as a Group is based on strong economic, social and gas projects by an associate. (Similarly, net non-recurrent income environmental principles. We strive to create high quality, visually of HK$1,395.5 million was recorded in the previous year made up stimulating, innovative new homes and commercial developments of a net gain of HK$650.7 million resulting from the privatisation that enhance, as well as integrate with, their surrounding natural of two listed subsidiaries, a deemed profi t of HK$829.6 million on and built environments. placement of Henderson Investment Limited shares, and project tender cost written off amounting to HK$84.8 million.) After Sustainability lies at the heart of this approach, we build effi cient, excluding such non-recurrent income, the adjusted underlying modern properties, but we also try to play our part in establishing profit for the year was HK$4,944.8 million, representing an or contributing to comfortable and friendly communities for our increase of HK$1,072.1 million or 27.7% over that for the previous customers to live and work in. Large-scale projects such as Grand year. Based on the adjusted underlying profi t, the earnings per Promenade, Grand Waterfront and the IFC complex have shown share were HK$2.61 (2006: HK$2.13), or an increase of 22.5%. The that our customers appreciate this approach and welcome the encouraging improvement in adjusted underlying profi t was the resultant quality of life that our properties afford them. result of signifi cantly higher profi t contributions from property Following the successful privatisation of Henderson China development, associates and jointly controlled entities, as well as Holdings Limited, the Group has injected substantial resources the steady increase in rental income from investment properties. in expanding its property development business in mainland At 30 June 2007, the net asset value attributable to equity China. Signifi cant progress has been made and the Group now shareholders amounted to HK$92,219.1 million, 18.3% higher has many new projects planned or underway. We are replicating than the amount of HK$77,964.1 million a year earlier, while the this approach and applying the same mix of innovative design, adjusted net asset value, after excluding deferred tax on the high quality construction standards and community commitment. revaluation surplus of investment properties, was HK$98,969.5 These major new commercial and residential projects will provide million (2006: HK$83,720.7 million). Net debt amounted to users with unparalleled living and working environments and will HK$8,750.1 million (2006: HK$13,035.4 million) and the gearing further enhance the Group’s reputation. ratio was 9.5% (2006: 16.7%). Profi t and Net Assets Attributable to Shareholders The Group profit attributable to equity shareholders for the year ended 30 June 2007 amounted to HK$9,817.7 million, representing a decrease of HK$3,731.0 million or 27.5% over that for the previous year. Earnings per share were HK$5.19 (2006: HK$7.47). The decrease in profi t attributable to equity shareholders for the year was mainly due to the higher revaluation surplus (net of deferred tax) of investment properties recognized in the previous year by HK$4,345.6 million when compared with the corresponding revaluation surplus (net of deferred tax) for the year. The underlying profit for the year, excluding the revaluation surplus of investment properties (net of deferred tax), was HK$5,882.8 million, an increase of HK$614.6 million or 11.7%. Based on the underlying profit, the earnings per share were Grand Waterfront, To Kwa Wan, Hong Kong HK$3.11 (2006: HK$2.90). Annual Report 2007 Henderson Land Development Company Limited 9 Chairman’s Statement Dividends in a buoyant property market. During the year, two large-scale development projects, namely, Grand Waterfront in To Kwa Wan Your Board recommends the payment of a final dividend of and The Sherwood in Tuen Mun were launched for sale. Up to the HK$0.70 per share to shareholders whose names appear on the year end, 1,143 residential units and 1,073 residential units, or Register of Members of the Company on 3 December 2007. The 64% and 68% respectively of the total units, were sold for these total distribution per share of HK$1.10 for the full year, including two development projects. Other projects which were launched the interim dividend of HK$0.40 per share already paid, represents for sale during the year, including Scenic Horizon in Shau Kei an increase of 5% over the total distribution per share in the Wan, CentrePlace in the Mid-Levels and The Verdancy in Yuen previous year. Warrants for the final dividend will be sent to Long, also received encouraging response. Together with the re- Shareholders on or before 5 December 2007. launch of other popular projects such as Grand Promenade, Royal Green and Metro Harbour View, during the year the Group sold an Business Review – Hong Kong attributable HK$7,894.8 million worth of properties in Hong Kong Property Sales (including the Group’s attributable share of the value of properties Substantial growth in GDP, rising wages, improved employment sold by associates and jointly controlled entities), a remarkable prospect and favourable bank mortgage terms have all resulted growth of 130% when compared with HK$3,434.6 million for the year before. Projects completed The following development projects were completed during this fi nancial year: Gross fl oor Attributable Site area area Land-use Group’s interest gross fl oor Project name and location (sq.ft.) (sq.ft.) purpose (%) area (sq.ft.) 1. Royal Green – Phase 2 97,133 165,358 Residential 45.00 74,411 18 Ching Hiu Road, (Note 1) Sheung Shui 2. Grand Waterfront 130,523 1,109,424 Commercial/ Residential: 46.12 Residential: 451,466 38 San Ma Tau Street, Residential Commercial: 26.19 Commercial: 34,178 To Kwa Wan 3. Newton Place Hotel 19,050 241,663 Hotel 100.00 241,663 163 Wai Yip Street, Kwun Tong 4. Phase 1, Lot No. 1740 in DD 122, 78,781 61,138 Residential 100.00 61,138 Tong Yan San Tsuen, Yuen Long (Note 2) Total: 862,856 Note 1: The total site area for the whole Phase 1 and Phase 2 of Royal Green is 97,133 square feet. Note 2: The total site area for the whole Phase 1 and Phase 2 of this project is 78,781 square feet. Phase 2 of this project is still under construction. The Sherwood, Tuen Mun, Hong Kong Annual Report 2007 10 Henderson Land Development Company Limited Chairman’s Statement By the end of the year, 203 units or 72% of the total units at Royal Green – Phase 2 were sold. New owners of Grand Waterfront units praised the development for the exceptional quality inherent in its construction and in the materials used, with a satisfaction rate of almost 100%. Newton Place Hotel at Kwun Tong, a stylish hotel with 598 guest rooms, has commenced business since July 2007, while the project in Tong Yan San Tsuen, a low-density development, will be launched for sale shortly. At the year end, the Group had a total of 3,341 residential units available for sale at the following major property development Newton Place Hotel, Kwun Tong, Hong Kong projects: (1) Major completed development projects offered for sale: No. of residential Gross units area of unsold remaining & pending unsold Gross Group’s sale as at residential Site area fl oor area Land-use interest fi nancial units Project name and location (sq.ft.) (sq.ft.) purpose (%) year end (sq.ft.) 1. Casa Marina I 283,200 226,561 Residential 100.00 48 164,667 28 Lo Fai Road, Tai Po 2. Casa Marina II 228,154 182,545 Residential 100.00 48 145,849 1 Lo Ping Road, Tai Po 3. King’s Park Hill 168,392 241,113 Residential 61.79 28 62,472 1-98 King’s Park Hill Road 4. Royal Terrace 16,744 138,373 Commercial/ 100.00 24 19,795 933 King’s Road Residential 5. Park Central – Phases 1 & 2 359,883 2,932,813 Commercial/ 24.63 30 25,084 Tseung Kwan O Town Lot Nos.