The Hongkong and Shanghai Hotels, Limited

Revenue from operations increased 8% year-on-year to HKD 3.5 billion. Including Peninsula London residential sales, total revenue was HKD 3.9 billion. EBITDA rose 20% to HKD 770 million, and profit attributable to shareholders improved to HKD 23 million versus a loss of HKD 289 million in the prior-year period. Net cash generated from operating activities before working capital movements increased 22% to HKD 727 million. Hotels revenue and EBITDA increased 9% and 21%, respectively; commercial properties revenue excluding Peninsula London residences rose 7% to HKD 486 million; and Peak Tram, retail and others revenue increased 2%. Management did not provide next-quarter or full-year numeric guidance, but said second-half demand should remain positive, residential leasing should stay resilient, and the group will focus on revenue growth, profitability protection and selective investment.

Christobelle Liao framed the half-year as another step forward in recovery and growth, emphasizing that demand at the top end stayed resilient despite an uneven travel backdrop. She highlighted broad-based RevPAR gains, better margins, and a return to profitability, while positioning the HKD 2 billion-plus renovation program at The Peninsula Hong Kong and The Peninsula Tokyo as central to Vision 2035. Her tone was constructive but measured, repeatedly noting that mixed external conditions still require careful management.

Keith Robertson detailed the financial improvement: revenue from operations rose 8% to HKD 3.5 billion, EBITDA grew 20% to HKD 770 million, and profit attributable to shareholders turned to HKD 23 million from a HKD 289 million loss. He said net cash from operating activities before working capital movements increased 22% to HKD 727 million, consolidated net debt was HKD 11.9 billion, net debt-to-total assets was 22%, and liquidity included HKD 1.9 billion of undrawn committed facilities. He also said the weighted average gross interest rate fell from 3.9% to 3.7%, average debt maturity was 1.7 years, 43% of borrowings were fixed rate, and refinancing of the HKD 6.5 billion club loan is targeted for completion in the second half of 2026.

Analysts asked about the pace and nature of the 'transform' strategy, and management said expansion would be intentional, with any new opportunity needing the right financial, strategic and brand criteria. They pointed to the HKD 2.1 billion investment program at The Peninsula Hong Kong and The Peninsula Tokyo as evidence that transformation also means upgrading the existing portfolio, not just adding new hotels. Questions on brand protection in asset-light or asset-right formats were answered by stressing partner and location selection, plus tight control over service standards and hardware. Management also addressed The Peninsula London Residences, saying 24 units were planned, 4 remained, and profitability is judged case by case in a tough London residential market; they also defended The Repulse Bay as a key cash-flow and EBITDA asset with 97% occupancy.