Sun Hung Kai & Co. Announces 2022 Annual Results
Sun Hung Kai & Co. Announces 2022 Annual Results
Maintains a Strong Liquidity Position and Healthy Balance Sheet
Encouraging AUM Growth in Funds Management
Diversified business mix and conservative balance sheet has helped the Group to navigate the strong headwinds. Its Financing assets and growing Funds Management platform provide it with a relatively uncorrelated diversified earnings stream, while the Investment Management unit focuses on generating risk-adjusted returns in the long term. Funds Management business achieved solid progress in 2022 post the setup year of 2021. AUM growth has been very encouraging, increased from US$809 million at end-2021 to US$975 million at end-2022, particularly from strategies that are better suited for the volatile market environment. Since Q4 2022, this business arm launched a new initiative Family Office Solutions (“FOS”). Such balanced and diversified assets give it a platform to deliver consistent value to shareholders.
*Primarily due to the mark-to-market losses taken by the Investment Management segment, reflecting the sharp sell-off in public markets and the subsequent impact on private market valuations.
The Group’s revenue in 2022 remained relatively stable at HK$4,054.1 million (2021: HK$4,324.0 million), mainly consisted of interest income from the Financing business of HK$3,832.8 million. Loss attributable to owners of the Company was HK$1,534.8 million (2021: profit of HK$2,813.7 million), primarily due to mark-to-market losses in the Investment Management division. The book value per share was HK$11.4 (2021: HK$12.7).
The Board declared a second interim dividend of HK14.0 cents per share for the year ended 31 December 2022, same as the previous year. During the year, the Company repurchased 5.9 million shares for a total net consideration of HK$18.3 million. In addition, the Company also repurchased its medium-term notes (“MTN”) with principal amount totalling US$59.8 million during the year and fully redeemed the 4.65% MTN upon its maturity in September 2022 with principal and interest amounting to US$443.9 million.
Mr. Lee Seng Huang, the Group Executive Chairman said, “With the end of COVID-19 restrictions in the region, we are cautiously optimistic about the prospects for 2023. However, the overall investment climate will continue to be extremely volatile. Despite this, we will continue our ongoing corporate transformation, and build out our alternative investments and funds management platforms.”
The Group’s pre-tax loss in 2022 was HK$892.3 million (2021: profit of HK$3,773.2 million), primarily due to the pre-tax loss recorded in the Investment Management segment, partially offset by a pre-tax profit of HK$1,274.7 million contributed by the Group’s Financing business, which is largely uncorrelated to capital markets.
The global markets are still facing multiple challenges including persistent inflation, conditional central banks’ decision, recession risks in EU and US as well as ongoing geopolitical tensions. However these challenges also highlight investors’ need for alternative investments, particularly in the Asian region, and confirm that the Group is moving in the right direction of corporate transformation.
Looking ahead, during this challenging investment cycle, the Group will continue to source partnership opportunities to create a broader and more diversified platform while remain cautious with significant capital deployment. The Group will also maintain diversified funding sources and strong liquidity to provide staying power and enable its future growth.
For more details of the 2022 earnings, please refer to the official announcement.
About Sun Hung Kai & Co. Limited
Sun Hung Kai & Co. Limited (SEHK: 86) (“SHK & Co.”, together with its subsidiaries, the “Group”) is a leader in alternative investing headquartered in Hong Kong. Since its establishment in 1969, the Group has owned and operated market-leading platforms in Financial Services. The Group invests across public markets, alternatives and real estate and has an established track record of generating long-term risk adjusted returns for its shareholders. In recent years, it has extended its strategy to incubate, accelerate and support emerging asset managers in the Asian region. It is also the major shareholder of a leading Consumer Finance firm, United Asia Finance Limited. The Group held about HK$43 billion in total assets as at 31 December 2022. For more information about SHK & Co., please visit its corporate website www.shkco.com.
For enquiries, please contact Hill+Knowlton Strategies Asia:
Joanne Lam / Vivian Kwan
Tel: (852) 2894 6211 / (852) 2894 6275 Email: SHKCo@hkstrategies.com
17/03/2023 Dissemination of a Financial Press Release, transmitted by EQS News.