CTF Services (659) H1 2025 earnings summary

Executive summary

• Profit attributable to shareholders increased 15% year-over-year to HK$1,157.6M–HK$1,158M for the six months ended 31 December 2024, despite a 13% revenue decline due to divestitures and segmental shifts.

• Attributable operating profit (AOP) of operating businesses rose 8% year-over-year to HK$2,209M–HK$2,225.3M, with operating businesses (excluding divested Free Duty) up 8%.

• Interim and special dividends declared at HK$0.30 per share each, totaling HK$0.60 per share, reflecting strong cash flow and capital management.

• Strategic portfolio optimization included the disposal of Free Duty business and Hyva Group, and the acquisition of CTF Life Insurance and Hsin Chong Aster.

• Focus on operational excellence, prudent financial management, and leveraging synergies within the CTF Group, with enhanced ESG initiatives.

Financial highlights

• Revenue for the period was HK$12,109.7M–HK$13,978.5M, down 13% year-over-year, mainly due to divestitures and lower construction revenue.

• Adjusted EBITDA declined 5% year-over-year to HK$3,556.8M–HK$3,557M.

• Net debt increased to HK$16.1Bn, with net gearing ratio at 39% (up from 35% as of 30 June 2024).

• Total available liquidity stood at HK$29.9Bn, with cash and bank balances of HK$18.6Bn and HK$11.3Bn undrawn banking facilities.

• Basic earnings per share increased to HK$0.29.

Outlook and guidance

• Expects continued growth in insurance and logistics, leveraging Chow Tai Fook Group synergies, new product launches, and expansion in the PRC, especially in logistics and construction.

• Construction segment to benefit from government infrastructure initiatives, Northern Metropolis development, and the acquisition of Hsin Chong Aster.

• Facilities Management outlook positive with the opening of Kai Tak Sports Park, government support for exhibitions, and growth at GHK Hospital.

• Group remains vigilant on macroeconomic uncertainties, interest rate risks, and RMB volatility, with proactive risk management and capital allocation.

• Commitment to prudent capital management, operational excellence, and sustainable dividend policy.