WHARF HOLDINGS(00004)2022-04-04 09:00Financial Performance - The group's underlying net profit increased by 7% to HKD 3.646 billion, with a significant reliance on logistics and investment properties for growth[14]. - Shareholders' profit rose by 56% to HKD 6.019 billion, with earnings per share at HKD 1.97[14]. - Total assets reached HKD 253.7 billion, with a net asset value of HKD 162 billion, equivalent to HKD 53.02 per share[14]. - The net debt was reduced by half to HKD 13.2 billion, resulting in a debt ratio decrease from 15.6% to 7.9% compared to December 31, 2020[14]. - Revenue for the year 2021 was HKD 22,378 million, representing a 7% increase from HKD 20,997 million in 2020[20]. - Operating profit decreased by 23% to HKD 8,536 million from HKD 11,104 million in the previous year[20]. - Basic net profit increased by 7% to HKD 3,646 million, compared to HKD 3,417 million in 2020[20]. - The total equity increased by 2% to HKD 166,377 million from HKD 163,476 million in 2020[20]. - The basic earnings per share rose by 6% to HKD 1.19 from HKD 1.12 in the previous year[20]. - The group recorded a revenue increase in its Hong Kong property segment to HKD 4,317 million, with operating profit rising to HKD 1,492 million[23]. Land and Property Development - As of the end of 2021, the group's land reserves for development properties in mainland China totaled 2.1 million square meters[3]. - The group has a cautious outlook on future land acquisitions, reflecting the changing market dynamics and intensified competition[3]. - The land reserve decreased to 2.1 million square meters, reflecting a more cautious approach to acquiring new land parcels due to strict price control measures and regulatory policies[27]. - The group focuses on six key cities in mainland China for property development, utilizing joint ventures to mitigate risks[84]. - The Mount Nicholson project achieved contracted sales totaling HKD 2,100 million, with 10 units remaining unsold out of 67[24]. Awards and Recognition - The group received multiple awards in 2021, including the "Ten Years + Business Caring" logo from the Hong Kong Council of Social Service and the Annual Responsible Brand Award at the 11th China Public Welfare Festival[4]. - The group maintains its position as a constituent of the Hang Seng Sustainable Development Index and received an AA rating from Hang Seng ESG[4]. - The company received the second place in the performance of commercial real estate enterprises for the year 2021, according to the China Real Estate Media "Viewpoint" performance index[44]. Corporate Social Responsibility - The group provided HKD 10 million through the "Kowloon Wharf Emergency Support Fund" to assist families affected by the fifth wave of the COVID-19 pandemic in Hong Kong[4]. - The group emphasizes its "Creating Tomorrow" philosophy, extending to community engagement and support for various charitable initiatives[3]. - The company has committed HKD 100 million to support pandemic relief efforts[15]. - The "School Start" program has benefited nearly 80,000 students across 82 schools, supported by 72 partner organizations[57]. - The company has been actively involved in charitable organizations and non-governmental organizations, reflecting its commitment to corporate social responsibility[157]. Sustainability and Environmental Initiatives - The company aims to achieve direct greenhouse gas emissions of zero by 2030 and carbon neutrality by 2050[52]. - The company has implemented a "Climate Change Policy Statement" across all business units to address climate-related risks and opportunities[50]. - The company upgraded the LED lighting system at Changsha International Finance Center to reduce energy consumption, showcasing its commitment to energy efficiency[51]. - The company has installed approximately 300 solar panels, providing 140,000 kWh of electricity, which is expected to reduce carbon emissions by over 51,800 kg compared to traditional power generation[52]. - The company actively promotes environmental awareness through community activities, such as the "Nature WEserve" event in Chengdu[51]. Governance and Board Structure - The board consists of 13 directors, including 6 executive directors and 7 independent non-executive directors, enhancing governance and oversight[90]. - The company has adopted a formal nomination policy since January 2019 to ensure a balanced and diverse board composition[92]. - The company emphasizes the importance of board diversity as a strategic goal for sustainable development[90]. - The company has established three board committees: Audit Committee, Remuneration Committee, and Nomination Committee, with their roles and responsibilities disclosed on the company website[104]. - The company has a directors' liability insurance policy in place to provide appropriate protection for its directors[141]. Risk Management - The board is responsible for overseeing the risk management and internal control systems to protect the interests of the company and its shareholders[112]. - The company has established a whistleblowing mechanism to allow employees and stakeholders to report any suspected misconduct confidentially[117]. - The company emphasizes the importance of continuous review and improvement of risk management systems to adapt to changes in the business and regulatory environment[116]. - Financial risks faced by the group include interest rate risk, foreign currency risk, equity price risk, and credit risk, with management policies in place to address these[191]. - The group actively assesses regulatory changes to mitigate legal and compliance risks across its operations in Hong Kong and mainland China[190]. Shareholder Communication - The group has adopted a Shareholder Communication Policy to ensure shareholders have access to unbiased and comprehensible information regarding financial performance and strategic goals[122]. - The company holds at least one annual general meeting to facilitate direct interaction with shareholders, allowing them to pose questions to board members and auditors[123]. - The company encourages shareholders to participate in meetings electronically to minimize health risks due to the ongoing pandemic[126]. - The group prioritizes shareholder privacy, ensuring that personal information is protected and disclosed only when legally required[124]. - The company regularly communicates with the investment community through various formats, including investor briefings and roadshows[124]. Financial Risks and Audit - The audit identified key audit matters related to the valuation of investment properties, emphasizing the significant judgments and estimates involved[196]. - The financial statements were prepared in accordance with Hong Kong Financial Reporting Standards, reflecting a true and fair view of the group's financial position as of December 31, 2021[194]. - The audit opinion confirmed that the financial statements were properly prepared in compliance with the Hong Kong Companies Ordinance[194]. - The audit committee has concluded that the risk management and internal control systems are effective and sufficient as of December 31, 2021[120]. - The company engaged external valuation firms to ensure independence and objectivity in the valuation process[196].