TIDMJAR
RNS Number : 0676U
Jardine Matheson Hldgs Ltd
28 July 2022
28th July 2022
For immediate release
The following announcement was issued today to a Regulatory
Information Service approved by the Financial Conduct Authority in
the United Kingdom.
Jardine Matheson Holdings Limited
Half-Year Results for the Six Months ended 30th June 2022
STRONG RECOVERY CONTINUES, UNCERTAINTY REMAINS IN CHINA
Highlights
-- Underlying profit of US$747 million for the period, up 22% against the prior year
-- Underlying earnings per share of US$2.60, up 40% against 2021
-- Performance of most businesses improves, with strong growth in Southeast Asia, particularly by
Astra, and further contribution from simplification of the Group's holding structure
-- Hong Kong and Chinese mainland businesses impacted by continuing pandemic restrictions
-- DFI Retail profit reduced by performance of associates and investment in e-commerce
-- Interim dividend at US c 55, up 25%, reflecting a rebalance towards interim as well as strong earnings
per share growth.
" There was a strong improvement in the Group's profitability in
the first half compared with the same period last year, with a
significantly improved performance in Southeast Asia, particularly
by Astra, and a further contribution to growth from the
simplification of the Group's holding structure. The Group expects,
however, that earnings growth will substantially moderate for the
full year, as COVID-19 continues to impact the Group's businesses,
particularly in Hong Kong and on the Chinese mainland.
On behalf of the Board, I would like to thank all our colleagues
across the Group for their continuing dedication, hard work and
professionalism during such challenging times.
The Group has a strong balance sheet and will continue to focus
on opportunities in its core, growing markets of Asia to create
sustainable long-term growth."
Ben Keswick, Executive Chairman
Results
(unaudited)
Six months ended 30th June
2022 2021 Change
US$m US$m %
------------------------------------ -------------------------------- -------------------------------- ------
Gross revenue including 100% of
associates
and joint ventures 55,994 52,488 +7
Revenue 18,277 17,492 +4
Underlying profit* attributable to
shareholders 747 615 +22
Profit/(loss) attributable to
shareholders 423 (117) n/a
Shareholders' funds(#) 29,228 29,781 -2
------------------------------------ -------------------------------- -------------------------------- ------
US$ US$ %
------------------------------------ -------------------------------- -------------------------------- ------
Underlying earnings per share* 2.60 1.86 +40
Earnings/(loss) per share 1.47 (0.35) n/a
Net asset value per share(#) 101.00 102.87 -2
USc USc %
------------------------------------ -------------------------------- -------------------------------- ------
Interim dividend per share 55.00 44.00 +25
------------------------------------ -------------------------------- -------------------------------- ------
* The Group uses 'underlying profit' in its internal financial
reporting to distinguish between ongoing business performance
and non-trading items, as more fully described in note
7 to the condensed financial statements. Management considers
this to be a key measure which provides additional information
to enhance understanding of the Group's underlying business
performance
# At 30th June 2022 and 31st December 2021, respectively.
Net asset value per share is based on the book value of
shareholders' funds.
----------------------------------- -------------------------------------------------------------------
The interim dividend of USc55.00 per share will be payable on
12th October 2022 to shareholders on the register of members at the
close of business on 19th August 2022 and will be available in cash
with a scrip alternative.
CHAIRMAN'S STATEMENT
Overview
The Group's underlying net profit for the first half was US$747
million, 22% higher than the same period last year, and returning
to the levels seen prior to the onset of the pandemic. Within this,
13 percentage-points of growth was driven by improved business
performance, with the balance reflecting a higher share of earnings
in businesses formerly owned by Jardine Strategic Holdings Limited
('JSH'), following the completion in mid-April 2021 of the
privatisation of JSH (the 'Group Simplification').
There were improved performances from most of the Group's
businesses in the first half of 2022, compared with the same period
last year, with particularly strong growth in Southeast Asia, led
by Astra. Jardine Cycle & Carriage ('JC&C'), the Group's
Motors business and Hongkong Land also saw increases in underlying
profit, and Mandarin Oriental delivered a lower underlying loss
than the same period last year.
DFI Retail Group ('DFI') saw a decline year-on-year in the
performance of their businesses, impacted by the resurgence in the
first half of the pandemic on the Chinese mainland and in Hong
Kong. The absence of Chinese mainland tourists also continued to
impact the performance of the Group's businesses in Hong Kong,
including Hongkong Land's Central retail portfolio, DFI's health
and beauty business and Mandarin Oriental's hotels.
The Group continues to benefit from its diversified exposure to
the key growth markets of Asia, with the different pathways of
China and Southeast Asia across the pandemic bringing resilience to
our earnings and growth. The strong performance of the Group's
businesses in Southeast Asia in the first half of 2022 led to 58%
of the Group's profit for the period coming from Southeast Asia and
37% coming from China.
Underlying earnings per share increased by 40% to US $2.60. Just
over half of this growth (+24 percentage-points) reflected impacts
of the Group Simplification, combining the effect on underlying net
profits of a higher share of earnings, as above, with the reduction
in the effective share count in Jardine Matheson Holdings Limited
(the 'Company') following the elimination of the cross-shareholding
held by JSH in the Company, which concluded in May 2022 and has
now, therefore, fully annualised.
Group revenue for the period was 4% higher at US$18.3 billion,
while gross revenue, including 100% of associates and joint
ventures, was up 7% at US$56.0 billion.
The Group recorded a non-trading net loss in the first half of
US$324 million, compared with a non-trading net loss of US$732
million in the first half of 2021. This was as a result of a net
decrease of US$148 million in the fair value of the Group's other
investments, the impairment of goodwill and investment in
associates of US$114 million, and a net fair value loss of US$70
million upon the semi-annual revaluation of investment properties
in Hongkong Land as at 30(th) June 2022. The Group recorded a
profit attributable to shareholders for the period of US$423
million, compared with a loss of US$117 million in the first half
of 2021.
Dividend
The Board has announced an interim dividend of USc55 per share,
an increase of 25% over the prior year. This reflects both the
strong EPS growth in the first half of the year and the Board's
decision to revert to a higher proportion of the total dividend for
the year to be paid at interim as the effects of the pandemic and
the impacts of the Group Simplification recede.
Significant Developments
The first half of the year continued to demonstrate the
importance of the Group applying innovation and adaptability in its
business approach. The pace of change continues to accelerate,
however, so we need to further drive forward our strategic
priorities in the second half of the year.
Evolving the Group Portfolio
The Group remains focussed on evolving its portfolio by
deploying and, where appropriate, recycling capital towards
strategic higher growth initiatives.
During the first half, Astra purchased a 5.43% stake in PT
Medikaloka Hermina Tbk, one of the largest hospital groups in
Indonesia, operating as Hermina Hospitals, which has an established
brand in women's and children's care.
In February 2022, a joint venture was announced between Astra,
Hongkong Land and LOGOS, a leading modern warehousing expert, to
expand logistics facilities across Indonesia.
Astra continues to invest in digital businesses in Indonesia,
and in the period it acquired an interest in Paxel, a
technology-based logistics startup, and increased its investments
in Sayurbox, an e-commerce grocery farm-to-table platform and
Mapan, a digital community-based social financing platform. In July
2022, Astra subscribed for a 49.56% stake in PT Bank Jasa Jakarta
('Bank Jasa Jakarta') for US$260 million, to support Astra
Financial Services' business development and digital offering. The
transaction is subject to satisfaction of conditions precedent and
regulatory approval.
During the period, Hongkong Land secured a 34% interest in a
primarily residential site in Xuhui District in Shanghai, adjacent
to the group's existing 1.1 million sq. m. mixed-used project in
West Bund. It also acquired a 49% interest in a residential site in
the Tanjong Katong area in Singapore, with a developable area of
599,000 sq. ft.
In July 2022, JC&C announced a general offer to acquire the
remaining shares in Cycle & Carriage Bintang, which it did not
already own. JC&C also increased its interest in Refrigeration
Electrical Engineering Corporation ('REE') in the period through
on-market purchases.
In July 2022, United Tractors announced a share buyback of up to
US$333 million.
Also in July 2022, Mandarin Oriental announced the sale of its
Washington DC hotel for gross proceeds of US$139 million. This sale
is consistent with the Group's strategy of driving future growth
primarily through development of its management business. The Group
has an exciting pipeline of hotels worldwide in locations and
properties which support its long-term vision for the brand.
Driving Innovation and Operational Excellence
The Group also continues to focus on driving innovation and
operational excellence in our businesses and in new ventures we
undertake. Despite the challenging market environment, our
businesses continued to introduce greater efficiency and
productivity.
We have been embedding innovation-thinking across our
businesses, underscored by events such as Digital Day and
LearnFest, where innovation-related themes are central to the
agenda.
DFI's yuu coalition loyalty programme continues to exceed
expectations and now has more than four million members. It has
built partnerships with a range of complementary businesses,
including Maxim's restaurants, insurance partners and, most
recently, in February 2022, a fuel partner. In May 2022, yuu-to-me
was launched, offering customers an integrated one-stop online
shopping experience across leading Hong Kong brands on a single
mobile app.
The Group remains focussed on making efficiency improvements
across its existing businesses to drive future growth. Good
progress has been made in a number of businesses, including JEC,
HACTL, Jardine Restaurants and Gammon, to implement measures in
areas such as procurement, shared resources and operations. HACTL
has, for example, increased its capacity to handle pallets by 30%
by enhancing its use of robotics, as well as introducing automation
more generally to increase efficiency. The Group has also begun
implementation of an in-house Global Business Services function, to
serve the growth and technology needs of its subsidiary
businesses.
Enhancing Leadership and Entrepreneurialism
Jardines continues its work to create a diverse and inclusive
culture where everyone can succeed. During the period, we launched
a new diversity and inclusion ('D&I') strategy to help progress
our ambitions across the Group. New initiatives included a learning
campaign on inclusive leadership, a comprehensive review to enhance
HR policies and new processes which support D&I. We have also
developed targets for increasing female representation in our
workforce and leadership. We recognise further progress needs to be
made to achieve our objectives.
The Group is working hard to support the growth of the next
generation of leaders within our businesses, ensuring our
colleagues can develop the skills they need.
We are also aiming to create an owner mindset among our staff,
and supporting this by enhancing our incentive structures to focus
less on current profits and more on value creation over a longer
time horizon. This longer-term view also incentivises
experimentation and innovation.
The Group's Investment and Business Development Committee
('IBDC') is accelerating decision-making and helping us establish
and support new teams, as well as bringing focus to specific
project investment proposals. The IBDC also references macro trends
to identify new opportunities to grow and serve our customers
across Asia.
Progressing Sustainability
The Group has made substantial progress in driving its
sustainability agenda and increasing visibility of the extensive
range of activity taking place across our businesses.
An important milestone in the Group's sustainability journey was
the publication of our inaugural Sustainability Report at the end
of June. This followed extensive work over the past year to set
appropriate metrics and gather data from each of our businesses, to
enable the Group to measure and report on progress in implementing
the sustainability agenda. Eight other Group businesses also
published sustainability reports during the first half, three for
the first time.
The Group demonstrated its commitment to addressing climate
change and promoting decarbonisation, by publishing a statement in
June 2022 clarifying its support for a Just Energy Transition to a
low carbon economy in the geographies where we operate. The
statement contains commitments to scale up investments in renewable
energy and related innovations; diversify into non-coal mineral
mining, and make no investments in new thermal or metallurgical
coal mines or new thermal coal-fired power plants.
In addition, the Company and JC&C published TCFD-aligned
disclosures in their sustainability reports.
The Group-wide colleague volunteering programme which was
launched at the end of last year, to facilitate participation by
colleagues across the Group in a range of social inclusion and
other activities, continues to gather momentum.
People
Ensuring the safety and wellbeing of our people remains a top
priority, as they face extensive challenges amid the ongoing
pandemic. We continue to support our colleagues' health and
wellbeing and invest in their development. We would like to thank
all our colleagues for their continuing dedication, hard work and
professionalism throughout the period.
Outlook
There was a strong improvement in the Group's profitability in
the first half compared to the same period last year, with a
significantly improved performance in Southeast Asia and a further
contribution to growth from the simplification of the Group's
holding structure, which has now fully annualised. COVID-19
continues to impact the Group's businesses in Hong Kong and on the
Chinese mainland, however, and conditions there remain uncertain
for the second half of the year .
Taking this together with expected lower sales in Hongkong
Land's mainland China development property business and stronger
comparable results in the second half of 2021, the Group expects
growth to substantially moderate for the full year.
The Group remains confident that its businesses have the right
strategic focus and valued market positions and are progressing
well to meet the rapidly-evolving needs of their customers. With
this foundation and substantial resources available to leverage
attractive investment opportunities in our core growth markets
across Asia, the Group is well positioned to drive sustainable mid-
and long-term earnings growth.
Ben Keswick
Executive Chairman
OPERATING REVIEW
The performance of the Group's businesses is described below, in
descending order of contribution to the Group's underlying profit
for the first half of the year.
Astra
Astra reported a net profit equivalent to US$1,254 million under
Indonesian reporting standards in the first half, a 106% increase
on the same period last year and ahead of pre-pandemic levels.
There were record performances from almost all its businesses in
the period, benefitting from improved economic conditions,
substantially elevated commodity prices and continued strong
business performance . The half-year net profit also included a
mark-to-market fair value gain on the group's investment in GoTo of
US$250 million.
Net income from Astra's automotive business increased
significantly to US$295 million, reflecting an increase in sales
volumes. The wholesale car market increased by 21% in the first
half, and Astra's car sales were 23% higher, with its market share
increasing slightly to 54%. The wholesale market for motorcycles
decreased by 8%, and Astra's Honda motorcycle sales fell by 13%,
due to production constraints caused by semiconductor supply
issues. As a result, its market share also decreased. Astra
Otoparts reported a 62% increase in profit, mainly due to higher
revenues from the original equipment manufacturer and replacement
market segments.
Net income from the Financial Services division increased by 36%
to US$200 million, due to higher contributions from the consumer
finance businesses. Consumer finance businesses saw a 18% increase
in the amounts financed, while the net income contribution from the
group's car-focussed finance companies increased by 47% on larger
loan portfolios. The contribution from the motorcycle-focussed
financing business increased significantly, due to lower levels of
non-performing loans. Heavy equipment-focussed finance operations
saw a 112% increase in the amounts financed and the net income
contribution from this business was 52% higher. General insurance
company, Asuransi Astra Buana, reported a 6% increase in net
income, due to higher underwriting income and investment
income.
The Heavy Equipment, Mining, Construction and Energy division
saw net income increase by 131% to US$427 million, mainly due to
higher contributions from heavy equipment sales, mining contracting
and coal mining, all of which benefitted from higher coal prices.
There were, however, some adverse impacts on coal operating volumes
arising from the temporary export ban on coal. United Tractors
reported a 129% increase in net income to US$715 million. Komatsu
heavy equipment sales increased by 111% and saw higher revenues
from its parts and service businesses. Mining contracting
operations reported 6% higher overburden removal volume, while coal
production fell by 13%. United Tractors' coal mining subsidiaries
recorded 8% lower coal sales, but this volume impact was more than
offset by higher coal selling prices. Agincourt Resources saw 18%
lower gold sales volumes.
Net income from Agribusiness increased by 25% to US$44 million,
mainly due to improved crude palm oil prices. The group's palm oil
operations were impacted in the period by the export ban on palm
oil imposed by the Indonesian government, but the ban is expected
to be temporary. The group's Infrastructure and Logistics division
reported a 288% increase in net profit, mainly due to improved
performance in its toll road businesses. Astra now has interests in
396km of operational toll roads along the Trans-Java network and
the Jakarta Outer Ring Road.
Hongkong Land
Hongkong Land's underlying profit attributable to shareholders
for the first six months of 2022 was US$425 million, up 8% from the
equivalent period in 2021 . There was a profit attributable to
shareholders of US$292 million, after accounting for a net non-cash
loss of US$133 million arising from the semi-annual revaluation of
investment properties. This compares with a loss attributable to
shareholders of US$865 million in the first half of 2021, which
included a net revaluation loss of US$1.3 billion. The group's
financial position remains robust, with a strong balance sheet and
liquidity.
On the Chinese mainland, Hongkong Land's development properties
business saw more sales completions in the first half of 2022,
resulting in higher profits than the same period last year. There
was, however, weak sentiment in the majority of its key markets,
impacting contracted sales despite the continued relaxation of
cooling measures.
The planned timing of sales completions and the impact of
pandemic-related restrictions on construction activities, however,
mean that profits from the group's Chinese mainland development
properties business will be lower in the second half and some
projects will be deferred into 2023.
Pandemic-related shutdowns impacted construction progress at the
group's mixed-use Galaxy Midtown project in Shanghai, possibly
delaying anticipated sales completions from the end of 2022 into
early 2023.
Market sentiment was also weak in a majority of the group's key
markets, impacting contracted sales despite the continued
relaxation of cooling measures. The group's attributable interest
in contracted sales was US$419 million in the first half of 2022,
compared to US$1,360 million and US$1,288 million in the first and
second halves of 2021, respectively. At 30th June 2022, the group
had US$2,425 million in sold but unrecognised contracted sales,
compared with US$2,853 million at the end of 2021.
Results from the group's residential development activities in
Singapore declined slightly compared to the first half of 2021,
primarily due to lower completion progress on projects. In
addition, s ales demand for the group's projects in the rest of
Southeast Asia was generally subdued.
Contributions from the Investment Properties business remained
resilient, despite negative rental reversions in Hong Kong.
The group's investment properties business in Hong Kong saw a
strong start to the year. Anti-pandemic measures introduced later
in the first quarter, however, as the number of COVID-19 cases
increased, impacted the number of new office leasing enquiries and
resulted in the group providing rental support to a select number
of retail tenants. The group's Central office portfolio
nevertheless continued to benefit from a flight to quality, as a
number of new tenants committed to long-term leases. Physical
vacancy was 5.4% at the end of June 2022, compared to 5.2% at the
end of 2021, and on a committed basis, it was 5.1%, compared to
4.9% at the end of 2021.
Hongkong Land's office portfolio in Singapore continued to
benefit from healthy leasing momentum, and vacancy on a committed
basis remained low.
Vacancy at the group's Central retail portfolio was unchanged
from the end of 2021, although base rental reversions remained
negative. Tourism has not yet returned to Hong Kong due to travel
and quarantine restrictions, adversely impacting retail sales
levels.
A number of luxury brands opened new stores as planned in
Beijing and Macau, despite the market challenges faced by the
group's retail operations due to pandemic-related restrictions,
which negatively impacted footfall and tenant sales.
In Shanghai, city-wide lockdowns saw development activities at
the multi-phase West Bund site suspended for over two months,
although construction has since resumed.
Jardine Motors
Jardine Motors delivered a 12% increase in underlying net profit
to US$172 million for the first half of the year . Zhongsheng, in
which the Group owns a 21% interest, and which acquired the Group's
Zung Fu China business in October 2021, recorded an 89% higher
contribution of US$150 million, relating to its performance for the
six months from July to December 2021. There was a 24% year-on-year
increase in the contribution from the United Kingdom business,
driven by strong margins on both new and used cars, although new
car volume remained low due to supply constraints caused by the
ongoing global semiconductor shortage.
Jardine Pacific
Jardine Pacific reported a 7% lower underlying net profit of
US$71 million in the first half, compared with an underlying net
profit of US$76 million in the equivalent period in 2021. There was
an adverse impact on the performance of a number of Jardine
Pacific's businesses from the resurgence of the pandemic in Hong
Kong, which was partially offset by the benefits realised from
ongoing operational improvements and government support.
Jardine Pacific operates within three main business segments:
engineering, consumer businesses and transport services.
Within the group's engineering businesses, JEC's contribution
was lower than last year, primarily as a result of project delays,
but strong levels of new work were secured in the period, leading
to a record order book at the half-year. Jardine Schindler's
contribution was lower than the same period last year, with softer
sales in its New Installation and Modernisation businesses and a
weaker margin overall. Gammon delivered good profit growth, largely
due to the timing of project completions, and its order book
remains strong.
Within Jardine Pacific's consumer businesses, Jardine
Restaurants Group reported a weaker performance overall, as strong
delivery sales in Pizza Hut Taiwan and benefits from process
re-engineering projects were offset by poorer performances in both
Pizza Hut and KFC Hong Kong, caused by the pandemic restrictions
there.
The Zung Fu business in Hong Kong and Macau reported a profit
for the period, as after-sales activities picked up in the second
quarter, despite fewer passenger car deliveries.
Within Jardine Transport Services, HACTL's contribution fell
compared with the same period last year, with lower volumes as
export demand softened. Jardine Aviation reported a higher loss,
with flight volumes remaining low.
Greatview continued to see volume growth in both the China and
international markets, but its business was impacted by both rising
raw material costs and higher supply chain costs, resulting in a
significantly weaker profit performance.
Jardine Cycle & Carriage
Jardine Cycle & Carriage delivered strong results in the
first half of 2022, compared to the same period in 2021, with
underlying profit 51% higher at US$522 million, mainly due to
higher contributions from Astra and its investment in THACO.
Excluding the Astra contribution of US$465 million, the business
reported an underlying profit for the period of US$57 million, 9%
higher than the first half of 2021.
THACO contributed a US$52 million profit, 43% higher than the
same period last year, mainly due to strong performance from its
automotive operations. The business benefitted from a temporary
reduction in registration fees for locally-assembled vehicles and
saw margins increase due to an improved sales mix.
There was a 20% higher contribution of US$28 million from the
group's Direct Motor Interests. Lower profits from the Singapore
operations - where car sales fell as sales volume was adversely
impacted by high Certificate of Entitlement ('COE') prices and
stock supply shortages - were more than offset by an improved
performance by Tunas Ridean in Indonesia, which saw increased
profitability across its automotive and financial services
businesses. Cycle & Carriage Bintang in Malaysia also
contributed an improved profit despite challenging trading
conditions, with higher business volume due to the sales tax
reduction and the impact of cost savings initiatives.
Among JC&C's other interests, the contribution from Siam
City Cement was 9% higher than the same period last year at US$15
million. There were higher cement volumes and prices in most of its
markets, but profits were adversely impacted by inflationary
pressure, high energy costs and the challenging economic conditions
in Sri Lanka.
REE's contribution of US$9 million, based on its first-quarter
results, was 71% higher than the previous year, due to an improved
performance from its hydropower investments, reflecting favourable
hydrography. REE has an increasing focus on its investments in
renewable energy sources, which also include solar.
JC&C's investment in Vinamilk produced a dividend income of
US$9 million, compared to US$11 million last year. Vinamilk
reported a 20% decrease in net profit, mainly due to higher raw
material and transportation costs.
Mandarin Oriental
Mandarin Oriental reported a lower underlying loss of US$21
million for the first half of the year, a 69% improvement from the
loss of US$67 million incurred in the equivalent period in
2021.
Except for its properties in North Asia, where government
restrictions on international and domestic travel remained in
place, the performance of the group's hotels substantially
recovered during the first half, with some properties achieving
room rates exceeding pre-COVID-19 levels.
In Europe, the Middle East and Africa, and America, where
pandemic restrictions were largely relaxed, the group benefitted
from strong leisure demand, with rates at or above pre-pandemic
levels and improving occupancy levels .
Demand in North Asia remained impacted by government
restrictions to contain regional COVID-19 outbreaks. In other Asian
markets, however, pandemic restrictions slowly eased, allowing a
gradual recovery in occupancy levels.
The group continues to have a strong pipeline of future
openings, with 25 announced projects to open in the next five
years, almost doubling the number of properties operated by the
group. The new properties comprise eleven standalone hotel
projects, eleven projects with hotel and residence components and
three standalone residences projects .
The valuation of the Causeway Bay site under development
remained broadly in line with the valuation at 31st December
2021.
DFI Retail Group
The performance of DFI in the first half of 2022 was impacted by
a number of challenges. There were poor performances by key
associates Yonghui and Maxim's, as well as reduced profit
contributions from Grocery Retail and Convenience, which faced a
combination of inflationary cost pressures and changing customer
behaviours. The weaker performances of these businesses more than
offset strong Health and Beauty profit growth and an increased
contribution from IKEA. DFI increased planned investments in
digital capacity and capability during the period. While these
reduced profit in the period, they are necessary to meet customers'
evolving needs for on-and off-line service and are made with a view
to driving long-term sustainable growth.
The group saw sales of US$4.5 billion for the period by its
subsidiaries, 1% lower than the prior year. It reported an
underlying loss of US$52 million for the first half, primarily due
to US$60 million losses attributable to associates. This compares
with an underlying profit of US$32 million for the equivalent
period in 2021.
DFI's share of Yonghui's underlying losses for the six months
ended March 2022 was US$38 million, including a US$64 million share
of losses for the final quarter of 2021. Encouragingly, Yonghui
reported improvements in like-for-like sales and profitability in
the first quarter of 2022.
In addition, the group's 50%-owned associate, Maxim's,
contributed a US$26 million loss in the first half. Performance in
the first quarter was severely impacted by government-imposed
dining restrictions in Hong Kong to address a further wave of
COVID-19 cases there, as well as temporary lockdowns on the Chinese
mainland. Sales, however, started to recover in Hong Kong over the
second quarter as restrictions eased.
Like-for-like sales by the Grocery Retail business in the first
half were slightly behind the prior year. There was good sales
growth in North Asia driven by pantry-stocking behaviour and strong
in-store execution, despite challenging external conditions and
supply chain constraints, particularly in the first quarter. Sales
performance in Southeast Asia was, however, impacted by the easing
of movement restrictions, which led to a reduction in
eating-at-home, store renovation disruptions in Singapore and stock
availability issues in Malaysia. Profitability in the half was
lower than the comparable period last year due to a combination of
inflation impacting cost of goods sold, e-commerce investment costs
and operating cost pressures.
The Health and Beauty business reported strong sales recovery in
the first half. Sales by Mannings in Hong Kong were supported by
effective in-store execution and a surge in demand for
pandemic-related products and over-the-counter medicines. Guardian
reported strong like-for-like sales growth across key geographies,
driven by a combination of a recovery in mall and tourist
locations, demand for pandemic-related products and effective
store-level execution. The profitability of the business also grew
strongly in the first half, driven by the sales recovery, effective
promotion management and cost control.
DFI's Convenience business saw varying operating performances
across regions in the first half, as pandemic-related restrictions
continued to impact North Asia.
Like-for-like sales for IKEA were lower in the first quarter, as
the pandemic continued to disrupt store operating capacity and
there was reduced stock availability. Like-for-like sales improved
in the second quarter, however, and IKEA's profitability in the
first half was ahead of the same period last year.
Financial Position
The balance sheet and liquidity of the Group remain strong.
Shareholders' funds were US$29.2 billion at 30th June 2022,
compared with US$29.8 billion at 31st December 2021.
Consolidated net debt excluding financial services companies was
US$7.8 billion at 30th June 2022, representing gearing of 14%,
compared with 11% at 31st December 2021.
The Group had liquidity of US$12.7 billion as at 30th June 2022,
consisting of US$6.4 billion in cash reserves and US$6.3 billion in
unused, committed debt facilities.
Jardine Matheson Holdings Limited
Consolidated Profit and Loss Account
(unaudited)
Six months ended 30th June Year ended 31st December
2022 2021 2021
Underlying Underlying Underlying
business Non-trading business Non-trading business Non-trading
performance items Total performance items Total performance items Total
US$m US$m US$m US$m US$m US$m US$m US$m US$m
Revenue (note 2) 18,277 - 18,277 17,492 - 17,492 35 ,862 - 35 ,862
Net operating costs (note
3) (16,310) (35) (16,345) (16,032) (91) (16,123) (32,534) 1,114 (31,420)
Change in fair value
of investment properties - (113) (113) - (1,323) (1,323) - (1,410) (1,410)
-------- ------------ -------- ----------- ------------ -------- ----------- ------------ --------
Operating profit/(loss) 1,967 (148) 1,819 1,460 (1,414) 46 3 ,328 (296) 3,032
Net financing charges
* financing charges (294) - (294) (291) - (291) (595) - (595)
* financing income 87 - 87 106 - 106 206 - 206
(207) - (207) (185) - (185) (389) - (389)
Share of results of associates
and
joint ventures (note
4)
* before change in fair value of investment properties 610 (106) 504 458 17 475 1,178 10 1,188
* change in fair value of investment properties - (21) (21) - (5) (5) - 81 81
610 (127) 483 458 12 470 1,178 91 1,269
Profit/(loss) before
tax 2,370 (275) 2,095 1,733 (1,402) 331 4,117 (205) 3,912
Tax (note 5) (445) 6 (439) (335) (6) (341) (828) (123) (951)
-------- ------------ -------- ----------- ------------ -------- ----------- ------------ --------
Profit/(loss) after tax 1,925 (269) 1,656 1,398 (1,408) (10) 3,289 (328) 2,961
-------- ------------ -------- ----------- ------------ -------- ----------- ------------ --------
Attributable to:
Shareholders of the Company
(notes 6 & 7) 747 (324) 423 615 (732) (117) 1,513 368 1,881
Non-controlling interests 1,178 55 1,233 783 (676) 107 1 ,776 (696) 1,080
-------- ------------ -------- ----------- ------------ -------- ----------- ------------ --------
1,925 (269) 1,656 1,398 (1,408) (10) 3,289 (328) 2,961
-------- ------------ -------- ----------- ------------ -------- ----------- ------------ --------
US$ US$ US$ US$ US$ US$
Earnings/(loss) per share
(note 6)
- basic 2.60 1.47 1.86 (0.35) 4.83 6.01
- diluted 2.60 1.47 1.86 (0.35) 4.83 6.01
-------- -------- ----------- -------- ----------- --------
Jardine Matheson Holdings Limited
Consolidated Statement of Comprehensive
Income
(unaudited) Year ended
Six months ended 31st
30th June December
2022 2021 2021
US$m US$m US$m
Profit/(loss) for the period 1,656 (10) 2,961
Other comprehensive income/(expense)
Items that will not be reclassified
to profit or loss:
--------------
Remeasurements of defined benefit
plans 1 (5) 86
Net revaluation surplus before
transfer to investment properties
- tangible assets - - 75
- right-of-use assets - - 3
Tax on items that will not be
reclassified - 1 (9)
1 (4) 155
Share of other comprehensive income/(
expense) of associates and joint
ventures 2 (2) 9
-------------------- -------------- ----------
3 (6) 164
Items that may be reclassified
subsequently to profit or loss:
Net exchange translation differences
-------------------- -------------- ----------
- net loss arising during the period (795) (275) (227)
- transfer to profit and loss - - (21)
(795) (275) (248)
Revaluation of other investments
at fair value
through other comprehensive income
-------------------- -------------- ----------
- net loss arising during the period (12) (10) (2)
- transfer to profit and loss (2) (2) (3)
(14) (12) (5)
Cash flow hedges
-------------------- -------------- ----------
- net gain arising during the period 55 59 75
- transfer to profit and loss (5) 6 12
50 65 87
Tax relating to items that may
be reclassified (11) (18) (21)
Share of other comprehensive expense
of associates and joint ventures (651) (92) (16)
-------------------- -------------- ----------
(1,421) (332) (203)
Other comprehensive expense for
the period,
net of tax (1,418) (338) (39)
-------------------- -------------- ----------
Total comprehensive income/(expense)
for
the period 238 (348) 2,922
-------------------- -------------- ----------
Attributable to:
Shareholders of the Company (353) (249) 1,908
Non-controlling interests 591 (99) 1,014
-------------------- -------------- ----------
238 (348) 2,922
-------------------------------------- -------------------- -------------- ----------
Jardine Matheson Holdings Limited
Consolidated Balance Sheet
(unaudited) At 31st
At 30th June December
2022 2021 2021
US$m US$m US$m
Assets
Intangible assets 2,577 2,646 2,635
Tangible assets 5,905 6,513 6,184
Right-of-use assets 4,052 4,636 4,274
Investment properties 32,500 32,937 32,847
Bearer plants 484 486 499
Associates and joint ventures 17,730 16,582 17,980
Other investments 2,950 2,847 2,908
Non-current debtors 3,008 2,997 2,961
Deferred tax assets 522 484 518
Pension assets 24 9 32
-------------- -------------- ---------
Non-current assets 69,752 70,137 70,838
-------------- -------------- ---------
Properties for sale 3,515 2,680 3,345
Stocks and work in progress 2,957 2,656 2,793
Current debtors 7,163 6,814 6,928
Current investments 15 80 46
Current tax assets 143 185 172
Bank balances and other liquid
funds
-------------- -------------- ---------
- non-financial services companies 5,725 7,280 6,904
- financial services companies 645 358 378
6,370 7,638 7,282
-------------- -------------- ---------
20,163 20,053 20,566
Asset classified as held for sale 82 20 85
-------------- -------------- ---------
Current assets 20,245 20,073 20,651
-------------- -------------- ---------
Total assets 89,997 90,210 91,489
-------------- -------------- ---------
Jardine Matheson Holdings Limited
Consolidated Balance Sheet (continued)
(unaudited) At 31st
At 30th June December
2022 2021 2021
US$m US$m US$m
Equity
Share capital 72 180 179
Share premium and capital reserves 26 34 25
Revenue and other reserves 29,130 33,771 35,800
Own shares held - (6,223) (6,223)
------------- --------------- ---------
Shareholders' funds 29,228 27,762 29,781
Non-controlling interests 27,846 28,108 28,587
------------- --------------- ---------
Total equity 57,074 55,870 58,368
------------- --------------- ---------
Liabilities
Long-term borrowings
------------- --------------- ---------
- non-financial services companies 11,274 11,144 11,026
- financial services companies 1,433 1,133 1,273
12,707 12,277 12,299
Non-current lease liabilities 2,842 2,953 3,022
Deferred tax liabilities 727 679 743
Pension liabilities 445 517 451
Non-current creditors 180 266 250
Non-current provisions 311 320 309
------------- --------------- ---------
Non-current liabilities 17,212 17,012 17,074
------------- --------------- ---------
Current creditors 10,308 9,661 10,074
Current borrowings
------------- --------------- ---------
- non-financial services companies 2,269 4,211 2,513
- financial services companies 1,624 2,054 1,846
3,893 6,265 4,359
Current lease liabilities 771 798 812
Current tax liabilities 565 406 609
Current provisions 174 198 193
------------- --------------- ---------
Current liabilities 15,711 17,328 16,047
Total liabilities 32,923 34,340 33,121
------------- --------------- ---------
Total equity and liabilities 89,997 90,210 91,489
------------- --------------- ---------
Jardine Matheson Holdings Limited
Consolidated Statement of Changes in Equity
Attributable
to Attributable
Asset Own shareholders to
Share Share Capital Revenue revaluation Hedging Exchange shares of the non-controlling Total
capital premium reserves reserves reserves reserves reserves held Company interests equity
US$m US$m US$m US$m US$m US$m US$m US$m US$m US$m US$m
Six months ended
30th June 2022
(unaudited)
At 1st January
2022 179 - 25 34,926 2,242 (18) (1,350) (6,223) 29,781 28,587 58,368
Total
comprehensive
expense - - - 417 - 38 (808) - (353) 591 238
Dividends paid
by the Company
(note 8) - - - (448) - - - - (448) - (448)
Dividends paid
to
non-controlling
interests - - - - - - - - - (677) (677)
Issue of shares - 1 - - - - - - 1 - 1
Employee share
option schemes - - 4 - - - - - 4 1 5
Scrip issued in
lieu of
dividends - - - 138 - - - - 138 - 138
Repurchase of
shares (1) (3) - (147) - - - - (151) - (151)
Reduction of
capital (106) (1) - (6,116) - - - 6,223 - - -
Capital - - - - - - - -
contribution
from
non-controlling
interests - 2 2
Share purchased
for a
share-based
incentive plan
in a subsidiary - - - (15) - - - - (15) (5) (20)
Change in
interests in
other
subsidiaries - - - 253 - - - - 253 (611) (358)
Change in
interests in
associates
and joint
ventures - - - 18 - - - - 18 (42) (24)
Transfer - 3 (3) - - - - - - - -
At 30th June
2022 72 - 26 29,026 2,242 20 (2,158) - 29,228 27,846 57,074
------- ------- -------- -------- ----------- -------- -------- ------- ------------ --------------- -------
On 8th March 2021, the Company announced a plan to simplify the Group's parent company structure, including
the acquisition for cash of the 15% of Jardine Strategic Holdings Limited's ('Jardine Strategic') issued
share capital that the Company and its wholly-owned subsidiaries did not already own (the 'Acquisition').
The Acquisition was implemented by way of an amalgamation of Jardine Strategic and a wholly-owned subsidiary
of the Company ('the amalgamated subsidiary'), under the Companies Act 1981 of Bermuda. The total Acquisition
value was US$5.6 billion. The Acquisition was financed by the issuance of a total of US$1.2 billion
bonds on 9th April 2021, new revolving credit facilities and existing cash resources.
The Acquisition was completed on 14th April 2021, following shareholders' approval at the special general
meeting on 14th April 2021. The Acquisition value and the related transaction costs resulted in a reduction
of the Group's total equity in 2021.
At the Company's annual general meeting on 5th May 2022, shareholders approved the cancellation of the
59% shareholding in the Company held directly and indirectly by the above amalgamated subsidiary by
way of a reduction of capital in the Company. The capital reduction, which was effective on 18th May
2022, constituted the final stage in the Group's simplification of its parent company structure.
----------------------------------------------------------------------------------------------------------------------------------------
Jardine Matheson Holdings Limited
Consolidated Statement of Changes in Equity (continued)
Attributable
to Attributable
Asset Own shareholders to
Share Share Capital Revenue revaluation Hedging Exchange shares of the non-controlling Total
capital premium reserves reserves reserves reserves reserves held Company interests equity
US$m US$m US$m US$m US$m US$m US$m US$m US$m US$m US$m
Six months ended
30th June 2021
(unaudited)
At 1st January
2021 181 - 31 33,497 2,167 (55) (1,152) (5,282) 29,387 33,456 62,843
Total
comprehensive
expense - - - (123) - 20 (146) - (249) (99) (348)
Dividends paid
by the Company
(note 8) - - - (375) - - - - (375) - (375)
Dividends paid
to
non-controlling
interests - - - - - - - - - (453) (453)
Issue of shares - 3 - - - - - - 3 - 3
Employee share
option schemes - - 1 - - - - - 1 - 1
Scrip issued in
lieu of
dividends - - - 112 - - - - 112 - 112
Repurchase of
shares (1) (1) - (229) - - - - (231) - (231)
Acquisition of
the remaining
interest
in Jardine
Strategic - - - - - - - (941) (941) (4,631) (5,572)
Change in
interests in
other
subsidiaries - - - 109 - - - - 109 (144) (35)
Change in
interests in
associates
and joint
ventures - - - (54) - - - - (54) (21) (75)
Transfer - 5 (5) 27 - - (27) - - - -
At 30th June
2021 180 7 27 32,964 2,167 (35) (1,325) (6,223) 27,762 28,108 55,870
------- ------- -------- -------- ----------- -------- -------- ------- ------------ --------------- -------
Year ended 31st
December 2021
At 1st January
2021 1 81 - 31 33 ,497 2,167 (55) (1,152) (5,282) 29,387 33 ,456 62 ,843
Total
comprehensive
income - - - 1,966 76 37 (171) - 1,908 1,014 2,922
Dividends paid
by the Company - - - (505) - - - - (505) - (505)
Dividends paid
to
non-controlling
interests - - - - - - - - - (669) (669)
Unclaimed
dividends
forfeited - - - 1 - - - - 1 1 2
Issue of shares - 3 - - - - - - 3 - 3
Employee share
option schemes - - 1 - - - - - 1 - 1
Scrip issued in
lieu of
dividends 1 (1) - 152 - - - - 152 - 152
Repurchase of
shares (3) (8) - (569) - - - - (580) - (580)
Acquisition of
the remaining
interest
in Jardine
Strategic - - - - - - - (941) (941) (4,627) (5,568)
Subsidiaries
disposed of - - - - - - - - - (5) (5)
Change in
interests in
subsidiaries - - - 282 - - - - 282 (581) (299)
Change in
interests in
associates
and joint
ventures - - - 73 - - - - 73 (2) 71
Transfer - 6 (7) 29 (1) - (27) - - - -
------- ------- -------- -------- ----------- -------- -------- ------- ------------ --------------- -------
At 31st December
2021 179 - 25 34 ,926 2,242 (18 ) (1,350) (6,223) 29,781 28,587 58,368
------- ------- -------- -------- ----------- -------- -------- ------- ------------ --------------- -------
Jardine Matheson Holdings Limited
Consolidated Cash Flow Statement
(unaudited)
Six months ended Year ended
30th June 31st December
2022 2021 2021
US$m US$m US$m
Operating activities
--------------- --------------- --------------
Cash generated from operations 2,428 3,135 5 ,383
Interest received 75 91 194
Interest and other financing charges
paid (263) (282) (573)
Tax paid (485) (351) (728)
--------------- --------------- --------------
1,755 2,593 4 ,276
Dividends from associates and joint
ventures 428 325 800
Cash flows from operating activities 2,183 2,918 5 ,076
Investing activities
--------------- --------------- --------------
Purchase of subsidiaries (5) - (24)
Purchase of associates and joint ventures
(note 10(a)) (193) (276) (194)
Purchase of other investments (note
10(b)) (300) (245) (467)
Purchase of intangible assets (68) (65) (158)
Purchase of tangible assets (424) (298) (620)
Additions to right-of-use assets (33) (19) (25)
Additions to investment properties (56) (72) (118)
Additions to bearer plants (18) (16) (32)
Advances to and repayments to associates
and
joint ventures (note 10(c)) (556) (223) (1,100)
Advances from and repayments from associates
and
joint ventures (note 10(d)) 332 432 850
Sale of subsidiaries - - 1,510
Sale of associates and joint ventures 7 - 60
Sale of other investments (note 10(e)) 145 203 398
Sale of tangible assets 29 62 135
Sale of right-of-use assets - - 13
Sale of investment properties - - 3
Cash flows from investing activities (1,140) (517) 231
Financing activities
--------------- --------------- --------------
Issue of shares 1 3 3
Capital contribution from non-controlling
interests 2 - -
Acquisition of the remaining interest
in Jardine Strategic (21) (5,447) (5,490)
Change in interests in subsidiaries
(note 10(f)) (360) (35) (299)
Purchase of own shares (153) (236) (584)
Purchase of shares for a share-based
incentive plan in
a subsidiary (20) - -
Drawdown of borrowings 4,248 8,953 12,572
Repayment of borrowings (4,048) (6,008) (11,467)
Principal elements of lease payments (432) (436) (894)
Dividends paid by the Company (310) (263) (353)
Dividends paid to non-controlling interests (671) (446) (669)
Cash flows from financing activities (1,764) (3,915) (7,181)
--------------- --------------- --------------
Net decrease in cash and cash equivalents (721) (1,514) (1,874)
Cash and cash equivalents at beginning
of period 7,278 9,153 9 ,153
Effect of exchange rate changes (199) (68) (1)
--------------- --------------- --------------
Cash and cash equivalents at end of
period 6,358 7,571 7 ,278
--------------- --------------- --------------
Jardine Matheson Holdings Limited
Analysis of Profit Contribution
(unaudited)
Six months ended Year ended
30th June 31st December
2022 2021 2021
US$m US$m US$m
Reportable segments
Jardine Pacific 71 76 175
Jardine Motors 172 154 318
Hongkong Land 220 184 474
DFI Retail (40) 25 82
Mandarin Oriental (17) (47) (48)
Jardine Cycle & Carriage 67 56 119
Astra 349 203 474
---------------- ---------------- --------------
822 651 1,594
Corporate and other interests (75) (36) (81)
---------------- ---------------- --------------
Underlying profit attributable
to shareholders* 747 615 1,513
Decrease in fair value of investment
properties (63) (691) (681)
Sale of Zung Fu China(#) - - 791
Sale of Zung Fu properties in Hong
Kong - - 337
Other non-trading items (261) (41) (79)
---------------- ---------------- --------------
Profit/(loss) attributable to shareholders 423 (117) 1,881
---------------- ---------------- --------------
Analysis of Jardine Pacific's contribution
Jardine Schindler 17 17 32
JEC 16 18 49
Gammon 13 8 39
Jardine Restaurants 13 18 27
Transport Services 11 15 31
Zung Fu Hong Kong(#) 3 - 4
Corporate and other interests (2) - (7)
---------------- ---------------- --------------
71 76 175
---------------- ---------------- --------------
Analysis of Jardine Motors' contribution
Hong Kong(#) and Chinese mainland 150 138 285
United Kingdom 20 16 38
Corporate 2 - (5)
---------------- ---------------- --------------
172 154 318
---------------- ---------------- --------------
* Underlying profit attributable to shareholders is the measure
of profit adopted by the Group in accordance with IFRS 8 'Operating
Segments'.
(#) During 2021, the operations under Jardine Motors had been
restructured. The motor trading business in the Chinese mainland
('Zung Fu China') was sold to the Group's associate, Zhongsheng, in
October 2021. Subsequent to the sale, the motor trading businesses
in Hong Kong and Macau ('Zung Fu Hong Kong') are managed by Jardine
Pacific. Accordingly, the results of these operations are presented
under Jardine Pacific from October 2021. Operations in the United
Kingdom and Zhongsheng remain unchanged with results presented
under Jardine Motors.
__________________________________________________________________________________________
Jardine Matheson Holdings Limited
Notes to Condensed Financial Statements
1. Accounting Policies and Basis of Preparation
The condensed financial statements have been prepared in
accordance with IAS 34 'Interim Financial Reporting' and on a going
concern basis. The condensed financial statements have not been
audited or reviewed by the Group's auditors pursuant to the UK
Auditing Practices Board guidance on the review of interim
financial information.
There are no changes to the accounting policies as described in
the 2021 annual financial statements and the Group has not early
adopted any standard or amendments that have been issued but not
yet effective. A number of amendments were effective from 1st
January 2022. The more important amendments applicable to the Group
is as follows:
Amendments to IAS 37 - Onerous Contracts - Cost of Fulfilling a
Contract
(effective from 1st January 2022)
The amendments clarifies that for the purpose of assessing
whether a contract is onerous, the cost of fulfilling the contract
includes both the incremental costs of fulfilling that contract and
an allocation of other costs that relate directly to fulfilling
contracts. The Group applied the amendment from 1st January 2022
and there is no significant impact on the Group's consolidated
financial statements.
2. Revenue
Jardine
Jardine Jardine Hongkong DFI Mandarin Cycle Intersegment
&
Pacific Motors Land Retail Oriental Carriage Astra transactions Group
US$m US$m US$m US$m US$m US$m US$m US$m US$m
------- ------- -------- ------- -------- -------- ------- ------------ -------
Six months
ended
30th June
2022
By product
and
service:
Property 2 - 894 - - - 32 (4) 924
Motor
vehicles 207 1,088 - - - 764 3,774 - 5,833
Retail and
restaurants 428 - - 4,483 - - - - 4,911
Financial
services - - - - - - 884 - 884
Engineering,
heavy
equipment,
mining
and
construction 321 - - - - - 4,166 (21) 4,466
Hotels - - - - 198 - - - 198
Other - - - - - - 1,061 - 1,061
------- ------- -------- ------- -------- -------- ------- ------------ -------
958 1,088 894 4,483 198 764 9,917 (25) 18,277
------- ------- -------- ------- -------- -------- ------- ------------ -------
Revenue from
contracts
with
customers:
------- ------- -------- ------- -------- -------- ------- ------------ -------
Recognised at
a
point in
time 666 1,088 235 4,483 62 714 8,810 (25) 16,033
Recognised
over
time 290 - 111 - 127 48 98 - 674
956 1,088 346 4,483 189 762 8,908 (25) 16,707
Revenue from
other
sources:
------- ------- -------- ------- -------- -------- ------- ------------ -------
Rental income
from
investment
properties 2 - 456 - - - 1 - 459
Revenue from
financial
services
companies - - - - - - 884 - 884
Other - - 92 - 9 2 124 - 227
2 - 548 - 9 2 1,009 - 1,570
------- ------- -------- ------- -------- -------- ------- ------------ -------
958 1,088 894 4,483 198 764 9,917 (25) 18,277
------- ------- -------- ------- -------- -------- ------- ------------ -------
Six months
ended
30th June
2021
By product
and
service:
Property 2 - 886 - - - 24 (5) 907
Motor
vehicles - 3,042 - - - 803 2,989 (6) 6,828
Retail and
restaurants 427 - - 4,537 - - - - 4,964
Financial
services - - - - - - 839 - 839
Engineering,
heavy
equipment,
mining
and
construction 239 - - - - - 2,593 (19) 2,813
Hotels - - - - 102 - - - 102
Other - - - - - - 1,039 - 1,039
------- ------- -------- ------- -------- -------- ------- ------------ -------
668 3,042 886 4,537 102 803 7,484 (30) 17,492
------- ------- -------- ------- -------- -------- ------- ------------ -------
Revenue from
contracts
with
customers:
------- ------- -------- ------- -------- -------- ------- ------------ -------
Recognised at
a
point in
time 458 3,040 46 4,537 37 770 6,433 (6) 15,315
Recognised
over
time 208 2 287 - 55 32 109 (19) 674
666 3,042 333 4,537 92 802 6,542 (25) 15,989
Revenue from
other
sources:
------- ------- -------- ------- -------- -------- ------- ------------ -------
Rental income
from
investment
properties 2 - 470 - - - 6 (5) 473
Revenue from
financial
services
companies - - - - - - 839 - 839
Other - - 83 - 10 1 97 - 191
2 - 553 - 10 1 942 (5) 1,503
------- ------- -------- ------- -------- -------- ------- ------------ -------
668 3,042 886 4,537 102 803 7,484 (30) 17,492
------- ------- -------- ------- -------- -------- ------- ------------ -------
Gross revenue, comprises revenue together with 100% of revenue
from associates and
joint ventures, are analysed as follows:
Six months ended 30th June
2022 2021
US$m US$m
By business:
Jardine Pacific 2,941 2,615
Jardine Motors 14,702 16,110
Hongkong Land 2,543 2,410
DFI Retail 14,028 13,950
Mandarin Oriental 356 168
Jardine Cycle & Carriage 4,023 3,253
Astra 17,547 14,114
Intersegment transactions (146) (132)
------ ------
55,994 52,488
------ ------
3. Net Operating Costs
Six months ended 30th June
2022 2021
US$m US$m
Cost of sales (13,407) (13,210)
Other operating income 250 282
Selling and distribution costs (1,984) (1,970)
Administration expenses (1,128) (1,092)
Other operating expenses (76) (133)
--------- --------
(16,345) (16,123)
--------- --------
In relation to the COVID-19 pandemic, the Group had received
government grants and rent concessions of US$23 million
(2021: US$34 million) and US$15 million (2021: US$26 million),
respectively, for the six months ended 30th June 2022. These
subsidies were accounted for as other operating income.
Net operating costs included the following
gains/(losses) from non-trading items:
Change in fair value of other investments (30) (56)
Impairment of assets (6) -
Sale of businesses 5 -
Restructuring of businesses (1) (35)
Other (3) -
(35) (91)
--------- --------
4. Share of Results of Associates and Joint Ventures
Six months ended 30th June
2022 2021
US$m US$m
By business:
Jardine Pacific (54) 49
Jardine Motors 150 93
Hongkong Land 143 115
DFI Retail (65) (28)
Mandarin Oriental (1) (15)
Jardine Cycle & Carriage 93 62
Astra 228 202
Corporate (11) (8)
----- -----
483 470
----- -----
Share of results of associates and joint
ventures included the following gains/(losses)
from non-trading items:
Change in fair value of investment properties (21) (5)
Change in fair value of other investments 7 30
Impairment of Assets (113) (14)
Other - 1
(127) 12
----- -----
Results are shown after tax and non-controlling interests in the
associates and joint ventures.
In relation to the COVID-19 pandemic, included in share of
results of associates and joint ventures were the Group's share of
the government grants and rent concessions of US$19 million (2021:
US$13 million) and US$9 million (2021: US$10 million),
respectively, for the six months ended 30th June 2022.
5. Tax
Six months ended 30th June
2022 2021
US$m US$m
Tax charged to profit and loss is analysed
as follows:
Current tax (485) (379)
Deferred tax 46 38
----- -----
(439) (341)
----- -----
China (53) (106)
Southeast Asia (370) (220)
United Kingdom (5) (4)
Rest of the world (11) (11)
----- -----
(439) (341)
----- -----
Tax relating to components of other comprehensive
income or expense is analysed as follows:
Remeasurements of defined benefit plans - 1
Cash flow hedges (11) (18)
(11) (17)
----- -----
Tax on profits has been calculated at rates of taxation
prevailing in the territories in which the Group operates.
Share of tax charge of associates and joint ventures of US$205
million (2021: US$160 million) is included in share of results of
associates and joint ventures. Share of tax charge of US$21 million
(2021: US$8 million) is included in other comprehensive income of
associates and joint ventures.
6. Earnings/(Loss) per Share
Basic earnings per share are calculated on profit attributable
to shareholders of US$423 million (2021: loss of US$117 million)
and on the weighted average number of 288 million (2021: 331
million) shares in issue during the period.
Diluted earnings per share are calculated on profit attributable
to shareholders of US$423 million (2021: loss of US$117 million),
which is after adjusting for the effects of the conversion of
dilutive potential ordinary shares of subsidiaries and on the
weighted average number of 288 million (2021: 331 million) shares
in issue during the period.
The weighted average number of shares is arrived at as
follows:
Ordinary shares
in millions
2022 2021
Weighted average number of shares in issue 644 721
Company's share of shares held by subsidiaries (356) (390)
------------ ------------
Weighted average number of shares for
basic earnings
per share calculation 288 331
Adjustment for shares deemed to be issued
for no consideration under the Senior
Executive Share
Incentive Schemes - -
------------ ------------
Weighted average number of shares for
diluted earnings per share calculation 288 331
------------ ------------
Additional basic and diluted earnings per share are also
calculated based on underlying profit attributable to shareholders.
A reconciliation of earnings is set out below:
Six months ended 30th June
2022 2021
Basic Diluted
Basic Diluted (loss)/ (loss)/
earnings earnings earnings earnings
per share per share per share per share
U S$m US$ US$ US$m US$ US$
Profit/(loss) attributable
to shareholders 423 1.47 1.47 (117) (0.35) (0.35)
Non-trading items (note
7) 324 732
----- ------
Underlying profit
attributable
to shareholders 747 2.60 2.60 615 1.86 1.86
----- ------
7. Non-trading items
Non-trading items are separately identified to provide greater
understanding of the Group's underlying business performance. Items
classified as non-trading items include fair value gains or losses
on revaluation of investment properties and on equity investments
which are measured at fair value through profit and loss; gains and
losses arising from the sale of businesses, investments and
properties; impairment of non-depreciable intangible assets,
associates and joint ventures and other investments; provisions for
the closure of businesses; acquisition-related costs in business
combinations; and other credits and charges of a non-recurring
nature that require inclusion in order to provide additional
insight into underlying business performance.
Six months ended 30th June
2022 2021
US$m US$m
By business:
Jardine Pacific (95) 16
Jardine Motors (1) -
Hongkong Land (70) (635)
DFI Retail (4) (12)
Mandarin Oriental 2 (71)
Jardine Cycle & Carriage (125) (84)
Astra 99 2
Corporate and other interests (130) 52
(324) (732)
----- -----
An analysis of non-trading items after
interest, tax and
non-controlling interests is set out below:
Change in fair value of investment properties
----- -----
- Hongkong Land (70) (635)
- other 7 (56)
----- -----
(63) (691)
Change in fair value of other investments (148) (1)
Impairment of assets (114) (11)
Sale and closure of businesses 4 -
Restructuring of businesses (1) (25)
Other (2) (4)
(324) (732)
----- -----
8. Dividends
Six months ended 30th June
2022 2021
US$m US$m
Final dividend in respect of 2021 of USc156.00
(2020: USc1 28 .00) per share 1,114 921
Company's share of dividends paid on the
shares held by subsidiaries (666) (546)
----- -----
448 375
----- -----
An interim dividend in respect of 2022 of USc55.00 (2021:
USc44.00) per share amounting to a total of US$159 million (2021:
US$318 million) is declared by the Board and will be accounted for
as an appropriation of revenue reserves in the year ending 31st
December 2022.
9. Financial Instruments
Financial instruments by category
The fair values of financial assets and financial liabilities,
together with carrying amounts at 30th June 2022 and 31st December
2021 are as follows:
Fair
value Fair value Financial
through through assets
Fair value profit other at Other Total
of hedging and comprehensive amortised financial carrying Fair
instruments loss income costs liabilities amount value
US$m US$m US$m US$m US$m US$m US$m
30th June 2022
Financial assets
measured at
fair value
Other investments
- equity investments - 2,088 - - - 2,088 2,088
* debt investments - 10 762 - - 772 772
* limited partnership investment funds - 105 - - - 105 105
Derivative financial
instruments 146 - - - - 146 146
----------- -------
146 2,203 762 - - 3,111 3,111
----------- ------- ------------- ----------- ----------- -------- --------
Financial assets
not measured at
fair value
Debtors - - - 8,207 - 8,207 8,049
Bank balances - - - 6,370 - 6,370 6,370
----------- ------- ------------- ----------- ----------- -------- --------
- - - 14,577 - 14,577 14,419
----------- ------- ------------- ----------- ----------- -------- --------
Financial liabilities
measured at
fair value
Derivative financial
instruments (19) - - - - (19) (19)
Contingent consideration
payable - (9) - - - (9) (9)
----------- ------- ------------- ----------- ----------- -------- --------
(19) (9) - - - (28) (28)
----------- ------- ------------- ----------- ----------- -------- --------
Financial liabilities
not measured at
fair value
Borrowings - - - - (16,600) (16,600) (16,092)
Lease liabilities - - - - (3,613) (3,613) (3,613)
Trade and other
payable excluding
non-financial
liabilities - - - - (7,666) (7,666) (7,666)
----------- ------- ------------- ----------- ----------- -------- --------
- - - - (27,879) (27,879) (27,371)
----------- ------- ------------- ----------- ----------- -------- --------
Financial instruments by category
Fair
value Fair value Financial
through through assets
Fair value profit other at Other Total
of hedging and comprehensive amortised financial carrying Fair
instruments loss income costs liabilities amount value
US$m US$m US$m US$m US$m US$m US$m
31st December
2021
Financial assets
measured at
fair value
Other investments
* equity investments - 2,055 - - - 2,055 2,055
* debt investments - - 777 - - 777 777
* limited partnership investment funds - 122 - - - 122 122
Derivative financial
instruments 54 - - - - 54 54
----------- -------
54 2,177 777 - - 3,008 3,008
----------- ------- ------------- ----------- ----------- -------- --------
Financial assets
not measured at
fair value
Debtors - - - 7,993 - 7,993 8,054
Bank balances - - - 7,282 - 7,282 7,282
----------- ------- ------------- ----------- ----------- -------- --------
- - - 15,275 - 15,275 15,336
----------- ------- ------------- ----------- ----------- -------- --------
Financial liabilities
measured at
fair value
Derivative financial
instruments (78) - - - - (78) (78)
Contingent consideration
payable - (9) - - - (9) (9)
----------- ------- ------------- ----------- ----------- -------- --------
(78) (9) - - - (87) (87)
----------- ------- ------------- ----------- ----------- -------- --------
Financial liabilities
not measured at
fair value
Borrowings - - - - (16,658) (16,658) (16,944)
L ease liabilities - - - - (3,834) (3,834) (3,829)
Trade and other
payable excluding
non-financial
liabilities - - - - (7,371) (7,371) (7,371)
----------- ------- ------------- ----------- ----------- -------- --------
- - - - (27,863) (27,863) (28,144)
----------- ------- ------------- ----------- ----------- -------- --------
Fair value estimation
(i) Financial instruments that are measured at fair value
For financial instruments that are measured at fair value
in the balance sheet, the corresponding fair value measurements
are disclosed by level of the following fair value measurement
hierarchy:
(a) Quoted prices (unadjusted) in active markets for identical
assets or liabilities ('quoted prices in active markets')
The fair values of listed securities and bonds are based
on quoted prices in active markets at the balance sheet
date. The quoted market price used for listed investments
held by the Group is the current bid price.
(b) Inputs other than quoted prices in active markets that
are observable for the asset or liability, either directly
or indirectly ('observable current market transactions')
The fair values of derivative financial instruments are
determined using rates quoted by the Group's bankers
at the balance sheet date. The rates for interest rate
swaps and caps, cross-currency swaps and forward foreign
exchange contracts are calculated by reference to market
interest rates and foreign exchange rates.
The fair values of unlisted investments mainly include
club and school debentures, are determined using prices
quoted by brokers at the balance sheet date.
(c) Inputs for assets or liabilities that are not based on
observable market data ('unobservable inputs')
The fair values of other unlisted equity investments
and limited partnership investment funds are determined
using valuation techniques by reference to observable
current market transactions (including price-to earnings
and price-to book ratios of listed securities of entities
engaged in similar industries) or the market prices of
the underlying investments with certain degree of entity
specific estimates or discounted cash flow by projecting
the cash inflows from these investments.
There were no changes in valuation techniques during the six
months ended 30th June 2022 and the year ended 31st December
2021.
The table below analyses financial instruments carried at fair
value at 30th June 2022 and
31st December 2021, by the levels in the fair value measurement
hierarchy:
Quoted Observable
prices current
in active market Unobservable
markets transactions inputs Total
US$m US$m US$m US$m
30th June 2022
Assets
Other investments
--------- ------------ ------------ -----
- equity investments 1,824 53 211 2,088
- debt investments 762 - 10 772
- limited partnership investment
funds - - 105 105
2,586 53 326 2,965
Derivative financial instruments
at
fair value
* through other comprehensive income - 144 - 144
* through profit and loss - 2 - 2
2,586 199 326 3,111
--------- ------------ ------------ -----
Liabilities
Contingent consideration
payable - - (9) (9)
Derivative financial instruments
at
fair value
* through other comprehensive income - (19) - (19)
- (19) (9) (28)
--------- ------------ ------------ -----
31st December 2021
Assets
Other investments
--------- ------------ ------------ -----
- equity investments 1,565 53 437 2,055
- debt investments 777 - - 777
- limited partnership investment
funds - - 122 122
2,342 53 559 2,954
Derivative financial instruments
at
fair value
- through other comprehensive
income - 42 - 42
* through profit and loss - 12 - 12
2,342 107 559 3,008
--------- ------------ ------------ -----
Liabilities
Contingent consideration
payable - - (9) (9)
Derivative financial instruments
at
fair value
* through other comprehensive income - (78) - (78)
- (78) (9) (87)
--------- ------------ ------------ -----
During the six months ended 30th June 2022, equity investments
amounted to US$240 million was transferred from 'Unobservable
inputs' to 'Quoted prices in active markets'. There were no
transfers among the three categories for the year ended 31st
December 2021.
Movement of unlisted equity and debt investments, and limited
partnership investment funds, which are valued based on
unobservable inputs during the year ended 31st December 2021 and
six months ended 30th June 2022 are as follows:
US$m
At 1st January 2021 379
Exchange differences (4)
Additions 152
Net change in fair value during the year included
in profit and loss 32
-----
At 31st December 2021 and 1st January
2022 559
Exchange differences (10)
Additions 33
Disposals (5)
Transfer to 'Quoted prices in active markets' (240)
Net change in fair value during the period included
in profit and loss (11)
-----
At 30th June 2022 326
-----
(ii) Financial instruments that are not measured at fair value
The fair values of current debtors, bank balances and
other liquid funds, current creditors,current borrowings
and current lease liabilities are assumed to approximate
their carrying amounts due to the short-term maturities
of these assets and liabilities.
The fair values of long-term borrowings are based on market
prices or are estimated using the expected future payments
discounted at market interest rates. The fair values of
non-current lease liabilities are estimated using the
expected future payments discounted at market interest
rates.
10. Notes to Consolidated Cash Flow Statement
(a) Purchase of associates and joint ventures for the six months ended 30th June 2022 mainly included US$84
million for Hongkong Land's investments in the Chinese mainland, US$24 million for Jardine Cycle & Carriage's
additional interest in Refrigeration Electrical Engineering Corporation, US$45 million for Astra's investment
in a toll road concession business and US$38 million for Corporate's additional investment in Livi Bank
Limited in Hong Kong.
Purchase for the six months ended 30th June 2021 mainly included US$249 million for Hongkong Land's investments
in the Chinese mainland.
(b) Purchase of other investments for the six months ended 30th June 2022 mainly included Astra's acquisition
of securities of US$191 million, and Astra's investments in healthcare services and a technology-based
logistics startup of US$74 million and US$15 million, respectively.
Purchase for the six months ended 30th June 2021 mainly included Astra's acquisition of securities.
(c) Advances to and repayments to associates and joint ventures for the six months ended 30th June 2022 mainly
included Hongkong Land's advances and repayments to its property joint ventures.
Advances for the six months ended 30th June 2021 included US$216 million for Hongkong Land's advances
and repayments to its property joint ventures and US$7 million for Mandarin Oriental's advances to its
associate and joint venture hotels.
(d) Advances from and repayments from associates and joint ventures for the six months ended 30th June 2022
and 2021 mainly included advances from and repayments from Hongkong Land's joint ventures.
(e) Sale of other investments for the six months ended 30th June 2022 mainly included sale of securities
in Astra.
Sale for the six months ended 30th June 2021 comprised sale of securities of US$132 million and US$71
million, respectively, in Astra and Corporate.
(f) Change in interests in subsidiaries
Six months ended 30th June
2022 2021
US$m US$m
Increase in attributable interests
* Hongkong Land (279) -
* Jardine Cycle & Carriage (73) -
* other (8) (35)
----- -----
(360) (35)
----- -----
Increase in attributable interests in other subsidiaries for the
six months ended 30th June 2021 included US$17 million and US$18
million for Jardine Cycle & Carriage's additional 29% and 25%
interests in Cycle & Carriage Bintang and Republic Auto,
respectively.
11. Capital Commitments and Contingent Liabilities
Total capital commitments at 30th June 2022 and 31st December
2021 amounted to US$2,713 million and US$2,864 million,
respectively.
Following the acquisition of the 15 per cent of Jardine
Strategic not previously owned by the Company and its wholly-owned
subsidiaries, which was effected on 14th April 2021, a number of
former Jardine Strategic shareholders are seeking an appraisal of
the fair value of their shares in Jardine Strategic by the Bermuda
court, relying upon the process referred to in the shareholder
circular issued in connection with the acquisition. These
shareholders claim the consideration of US$33 per share that
Jardine Strategic considered to be fair value for its shares, and
that all shareholders have already received, did not represent fair
value. The proceedings, which were commenced in April 2021, are
still ongoing. It is anticipated that the court appraisal process
will not be concluded for at least a further 12 months. The Board
believes that the US$33 per share that was paid represented fair
value to Jardine Strategic minority shareholders and is of the
opinion that no provision is required in relation to these
claims.
Various Group companies are involved in litigation arising in
the ordinary course of their respective businesses. Having reviewed
outstanding claims and taking into account legal advice received,
the Directors are of the opinion that adequate provisions have been
made in the condensed financial statements.
12. Related Party Transactions
In the normal course of business the Group undertakes a variety
of transactions with certain of its associates and joint
ventures.
The most significant of such transactions relate to the
purchases of motor vehicles and spare parts from the Group's
associates and joint ventures in Indonesia including PT
Toyota-Astra Motor, PT Astra Honda Motor and PT Astra Daihatsu
Motor. Total cost of motor vehicles and spare parts purchased for
the six months ended 30th June 2022 amounted to US$1,787 million
(2021: US$2,198 million). The Group also sells motor vehicles and
spare parts to its associates and joint ventures in Indonesia
including PT Astra Honda Motor, PT Astra Daihatsu Motor and PT
Tunas Ridean. Total revenue from sales of motor vehicles and spare
parts for the six months ended 30th June 2022 amounted to US$344
million (2021: US$271 million).
There were no other related party transactions that were
considered to have a material effect on the financial position or
performance of the Group that were entered into or changed during
the first six months of the current financial year.
Amounts of outstanding balances with associates and joint
ventures are included in debtors and creditors, as appropriate.
Jardine Matheson Holdings Limited
Principal Risks and Uncertainties
The Board has overall responsibility for risk management and
internal control. The following have been identified previously as
the areas of principal risk and uncertainty facing the Company, and
they remain relevant in the second half of the year.
-- Economic Risk
-- Commercial Risk
-- Financial and Treasury Risk
-- Concessions, Franchises and Key Contracts Risk
-- Regulatory and Political Risk
-- Pandemic and Natural Disasters Risk
-- Cybersecurity Risk
-- Investment, Strategic Transactions and Partnerships Risk
-- People Risk
-- Environmental and Climate Risk
For greater detail, please refer to pages 74 to 78 of the
Company's 2021 Annual Report, a copy of which is available on the
Company's website at www.jardines.com.
Responsibility Statement
The Directors of the Company confirm to the best of their
knowledge that:
(a) the condensed financial statements have been prepared in accordance with IAS 34; and
(b) the interim management report includes a fair review of all
information required to be disclosed by the Disclosure Guidance and
Transparency Rules 4.2.7 and 4.2.8 issued by the Financial Conduct
Authority of the United Kingdom.
For and on behalf of the Board
John Witt
Graham Baker
Directors
28th July 2022
Dividend Information for Shareholders
The interim dividend of USc55 per share will be payable on 12th
October 2022 to shareholders on the register of members at the
close of business on 19th August 2022. The shares will be quoted
ex-dividend on 18th August 2022 and the share registers will be
closed from 22nd to 26th August 2022, inclusive. The dividend will
be available in cash with a scrip alternative.
Shareholders will receive their cash dividends in United States
Dollars, except when elections are made for alternate currencies in
the following circumstances.
Shareholders on the Jersey branch register
Shareholders registered on the Jersey branch register will have
the option to elect for their dividends to be paid in Sterling.
These shareholders may make new currency elections for the 2022
interim dividend by notifying the United Kingdom transfer agent in
writing by 23rd September 2022. The Sterling equivalent of
dividends declared in United States Dollars will be calculated by
reference to a rate prevailing on 28th September 2022.
Shareholders holding their shares through CREST in the United
Kingdom will receive their cash dividends in Sterling only as
calculated above.
Shareholders on the Singapore branch register who hold their
shares through The Central Depository (Pte) Limited ('CDP')
Shareholders who are on CDP's Direct Crediting Service
('DCS')
For those shareholders who are on CDP's DCS, they will receive
their cash dividends in Singapore Dollars unless they opt out of
CDP Currency Conversion Service, through CDP, to receive United
States Dollars.
Shareholders who are not on CDP's DCS
For those shareholders who are not on CDP's DCS, they will
receive their cash dividends in United States Dollars unless they
elect, through CDP, to receive Singapore Dollars.
Shareholders on the Singapore branch register who wish to
deposit their shares into the CDP system by the dividend record
date, being 19th August 2022, must submit the relevant documents to
M & C Services Private Limited, the Singapore branch registrar,
by no later than 5.00 p.m. (local time) on 18th August 2022.
The Jardine Matheson Group
Jardine Matheson is a diversified Asian-based group founded in
China in 1832, with unsurpassed experience in the region. It has a
broad portfolio of market-leading businesses, which represent a
combination of cash generating activities and long-term property
assets and are closely aligned to the increasingly prosperous
consumers of the region. The Group's businesses aim to produce
sustainable returns by providing their customers with high quality
products and services. The Group is committed to driving long-term
sustainable success in our businesses and our communities.
Jardine Matheson operates principally in China and Southeast
Asia, where its subsidiaries and affiliates benefit from the
support of the Group's extensive knowledge of the region and its
long-standing relationships. These companies are active in the
fields of motor vehicles and related operations, property
investment and development, food retailing, health and beauty, home
furnishings, engineering and construction, transport services,
restaurants, luxury hotels, financial services, heavy equipment,
mining and agribusiness.
Jardine Matheson holds interests in Jardine Pacific (100%),
Jardine Motors (100%), Hongkong Land (52.6%), DFI Retail Group
(77.6%), Mandarin Oriental (79.5%) and Jardine Cycle & Carriage
(75.9%) ('JC&C'). JC&C in turn has a 50.1% shareholding in
Astra.
Jardine Matheson Holdings Limited is incorporated in Bermuda and
has a primary listing on the London Stock Exchange, with secondary
listings in Bermuda and Singapore. Jardine Matheson Limited
operates from Hong Kong and provides management services to Group
companies.
- end -
For future information, please contact:
Jardine Matheson Limited
Graham Baker / Max Sunarcia (852) 2843 8218 / 8266
Brunswick Group Limited
William Brocklehurst (852) 5685 9881
As permitted by the Disclosure Guidance and Transparency Rules
of the Financial Conduct Authority in the United Kingdom, the
Company will not be posting a printed version of the Half-Year
Results announcement for the six months ended 30th June 2022 to
shareholders. This Half-Year Results announcement will be made
available on the Company's website, www.jardines.com, together with
other Group announcements.
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END
IR PPUMAMUPPUMR
(END) Dow Jones Newswires
July 28, 2022 08:42 ET (12:42 GMT)
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