Chairman’s Statement Dear Shareholders, We continue to demonstrate our global leadership in the ESG sector, ranking second in our industry on the The first half of 2024 presented several challenges for Dow Jones Sustainability World Index. We are also Swire Properties, mainly due to the ongoing uncertainty breaking new ground by integrating nature and and geopolitical tension affecting the global economy. biodiversity into the design and operations of our Despite these headwinds our commitment to our long- developments. A good example is the biophilic design term strategy of continuous investment in key markets to that has been incorporated into the newly opened Taikoo deliver sustainable dividend growth remains unchanged. Square and Taikoo Garden, part of the extensive green We have continued to make good progress in delivering open space that is an important feature of our Taikoo our HK$100 billion investment plan, of which more than Place redevelopment project in Hong Kong. Our 60% has now been committed. In the Chinese Mainland, membership of the Taskforce on Nature-related Financial HK$50 billion has been allocated to expand and reinforce Disclosures (“TNFD”) is another demonstration of our existing developments and help us develop new, resolve in this area. We remain steadfast in our large-scale, retail-led landmarks in Tier-1 and emerging commitment to our sustainability goals and will continue Tier-1 cities. In Hong Kong, HK$30 billion has been to leverage the power of innovative digital solutions to allocated to continue the expansion of our core improve our readiness for the future. commercial portfolios, Taikoo Place and Pacific Place, while HK$20 billion is being invested in residential trading Results Summary projects in Hong Kong, the Chinese Mainland and new markets in South East Asia. Our recurring underlying profit attributable to This plan sets out a clear path for the growth of Swire shareholders decreased by HK$322 million from Properties over the next decade. Despite some softness HK$3,892 million in the first half of 2023 to HK$3,570 in our core markets, in particular the subdued office million in the first half of 2024, which mainly reflected sector in Hong Kong, we remain confident in the long- higher net finance charges and a reduction in office term growth of our business in Hong Kong and the rental income in Hong Kong. Our underlying profit Chinese Mainland, specifically in the context of Beijing, decreased slightly by 1% to HK$3,857 million in the first Shanghai and the Greater Bay Area. half of 2024, which includes the sale of car parking spaces at our Taikoo Shing residential development in We continue to adopt an active capital recycling strategy Hong Kong. to explore divestment opportunities for non-core assets Our reported profit attributable to shareholders in the to strengthen our balance sheet and to support future first half of 2024 was HK$1,796 million, compared with investments in our core market. HK$2,223 million in the same period of 2023. There was a In the Chinese Mainland, we are making good progress fair value loss on investment properties of HK$879 million with our new investments in different cities, including in the first half of 2024 compared to HK$1,635 million in large-scale developments in Beijing, Shanghai, Sanya and the same period in 2023. A change in the fair value of Xi’an. The Chinese Mainland is an increasingly significant investment properties is non-cash in nature and has no contributor to the growth in our rental income. We will impact on our operating cash flow nor on underlying continue to leverage our two well-established brands, profit attributable to shareholders. Our balance sheet Taikoo Hui and Taikoo Li, to develop projects that remains strong. The overall financial position of the will become major lifestyle landmarks in their Company remains healthy and the change in fair respective cities. value is not expected to have any impact on our investment strategy. 9