Sino Land : Interim Results for the Six Months Ended 31 December 2016

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I am pleased to present my interim report to the shareholders.

The Group's unaudited underlying net profit attributable to shareholders, excluding the effect of fair-value changes on investment properties for the six months ended 31st December, 2016 ("Interim Period") was HK$2,746.0 million (2015: HK$3,006.9 million). Underlying earnings per share was HK$0.44 (2015: HK$0.49).

The Group's net profit attributable to shareholders for the Interim Period was HK$3,440.1 million (2015: HK$3,884.2 million). Earnings per share was HK$0.56 (2015: HK$0.64). The reported profit for the Interim Period included a revaluation surplus (net of deferred taxation) on investment properties of HK$694.1 million compared with a revaluation surplus (net of deferred taxation) of HK$877.3 million for the last period.

The unaudited results for the Interim Period have been reviewed by the Company's auditor, Deloitte Touche Tohmatsu and they reflect the adoption of all Hong Kong Financial Reporting Standards applicable to the Group that are effective for the accounting period.

The Directors have declared an interim dividend of 13 cents per share payable on 12th April, 2017 to those shareholders whose names appear on the Register of Members of the Company on 13th March, 2017.

The interim dividend will be payable in cash but shareholders will be given the option of electing to receive the interim dividend in the form of new shares in lieu of cash in respect of part or all of such dividend. The new shares to be issued pursuant to the scrip dividend scheme are subject to their listing being granted by the Listing Committee of The Stock Exchange of Hong Kong Limited.

A circular containing details of the scrip dividend scheme will be despatched to the shareholders together with a form of election for scrip dividend on or about 16th March, 2017. It is expected that the interim dividend warrants and share certificates will be despatched to the shareholders on or about 12th April, 2017.

1. Sales Activities

   Total revenue from property sales for the Interim Period, including property sales of associates and joint ventures recognised by the Group, was HK$9,499.1 million (2015 : HK$7,187.4 million).

   Total revenue from property sales comprises mainly the sales of residential units in Corinthia By The Sea, Dragons Range, Cluny Park, Botanica Bay, Mayfair By The Sea I and II, Providence Bay, Providence Peak, The Graces•Providence Bay and Marinella, and to date, approximately 99%, 98%, 93%, 88%, 99%, 99%, 94%, 98%, 99% and 98% of their

   respective residential units have been sold.

   During the Interim Period, the Group launched Park Mediterranean in Sai Kung for sale and to date, approximately 46% of the residential units have been sold.

   In China, 215 residential units in The Palazzo in Chengdu were launched for sale during the Interim Period. To date, a total of 3,915 residential units in The Palazzo and 1,649 residential units in Dynasty Park have been launched for sale and approximately 90% and 99% of the units in the respective projects have been sold.

2. Land Bank

   As at 31st December, 2016, the Group has a land bank of approximately 32.4 million square feet of attributable floor area in Hong Kong, China, Singapore and Sydney which comprises a balanced portfolio of properties of which 55.6% is residential; 28.3% commercial; 7.0% industrial; 4.6% car parks and 4.5% hotels. In terms of breakdown of the land bank by status, 19.7 million square feet were properties under development, 11.8 million square feet of properties for investment and hotels, together with 0.9 million square feet of properties held for sale. The Group will continue to be selective in replenishing its land bank to optimise its earnings potential.

   During the Interim Period, the Group acquired two sites from the HKSAR Government and the development rights of a site from Urban Renewal Authority of Hong Kong. Details of the projects are as follows:

   Location	Usage	Group's Interest	Attributable Floor Area(Square feet)
   1. TPTL 228 Fo Yin Road, Pak Shek Kok, Tai Po, New Territories, Hong Kong	Residential	100%	412,530
   2. AIL 462 Yip Kan Street and Wong Chuk Hang Road, Wong Chuk Hang, Hong Kong	Commercial	60%	170,967
   3. URA's Demand-Led Project 1-3B Kowloon Road / 1-5 Kiu Yam Street, Sham Shui Po, Kowloon, Hong Kong	Residential/ Retail	Joint Venture	52,571
   636,068

   Subsequent to the Interim Period, the Group was awarded the development rights by the Ocean Park Corporation to build and manage a hotel located at a site between Po Chong Wan and Tai Shue Wan within the Ocean Park boundary on 5th January, 2017. The Group has 60% equity interest in the project. Upon completion, it will provide a total of approximately 262,017 square feet of attributable gross floor area.

3. Property Development

   During the Interim Period, the Group obtained an Occupation Permit for the following project in Hong Kong and details of the project are as follows:

   Location	Usage	Group's Interest	Attributable Floor Area(Square feet)
   Paloma Cove, 8 Peng Chau Ho King Street, Peng Chau, New Territories, Hong Kong	Residential	100%	14,372

4. Rental Activities

   For the Interim Period, the Group's gross rental revenue, including attributable share from associates and joint ventures, increased 3.4% to HK$1,958.1 million (2015: HK$1,894.4 million) and net rental income increased 4.2% to HK$1,715.9 million (2015: HK$1,646.7 million). The increase in rental revenue was mainly due to higher rental rates on renewals. Overall occupancy of the Group's investment property portfolio was at approximately 97% (2015: 97%) for the Interim Period.

   The Group's retail portfolio in Hong Kong recorded rental growth with overall occupancy rate at approximately 98% (2015: 97%) for the Interim Period as the Group's flagship shopping malls, namely Tuen Mun Town Plaza Phase I, Olympian City 1, 2 and 3 showed steady leasing performance.

   The leasing performance of the Group's office portfolio saw stable rental growth while overall occupancy rate was at approximately 97% (2015: 98%) for the Interim Period. The leasing performance of the Group's industrial portfolio was steady with occupancy rate at approximately 96% (2015: 97%).

   The Group's investment property portfolio primarily serves the need of its customers which include tenants, shoppers and the communities around the properties. The design and condition of the properties together with the quality of service provided to customers are of paramount importance. To ensure that the properties are in good condition with the proper layout and design, the Group would perform regular review of the properties. On service quality, the Group places a strong emphasis on regular training particularly for all front-line staff to ensure that the service provided to customers meets their expectations. Comments from customers, reports by silent shoppers and recognitions from professional institutions all play a role in assessing the quality of service delivered by the staff.

   As at 31st December, 2016, the Group has approximately 11.8 million square feet of attributable floor area of investment properties and hotels in Hong Kong, China, Singapore and Sydney. Of this portfolio, commercial developments (retail and office) account for 62.6%, industrial 14.9%, car parks 12.4%, hotels 7.7%, and residential 2.4%.

5. Hotels

The Group's portfolio of hotels comprises The Fullerton Hotel Singapore, The Fullerton Bay Hotel Singapore, Conrad Hong Kong, The Westin Sydney and The Olympian Hong Kong. Overall business performance of the Group's hotels was steady during the Interim Period. The Group will continue to improve the quality of its hotel services to ensure our discerning guests have enjoyable experiences during their stays in the hotels.