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5. Cost of Sales 2022 2021 HK$M HK$M Restated Direct rental outgoings in respect of investment properties that – generated rental income 2,798 2,885 – did not generate rental income 199 177 2,997 3,062 Property trading 621 1,856 Hotels 685 883 4,303 5,801 6. Other Net Gains 2022 2021 HK$M HK$M Gains on disposal of investment properties 31 1,028 Gains on disposal of property, plant and equipment – 9 Gains on disposal of assets classified as held for sale 20 36 Change in fair value of assets classified as held for sale 48 42 Change in fair value of financial assets at fair value through profit or loss – (12) Net foreign exchange (losses)/gains (107) 60 Government subsidies 31 15 Others 56 53 79 1,231 7. Expenses by Nature Expenses included in cost of sales, administrative and selling expenses, and other operating expenses are analysed as follows: 2022 2021 HK$M HK$M Restated Impairment charged on trade receivables* 341 466 Depreciation of property, plant and equipment (note 15) 232 273 Depreciation of right-of-use assets – leasehold land held for own use 25 27 – property 39 38 Amortisation of – intangible assets (note 17) 53 47 – initial leasing costs in respect of investment properties 79 35 Staff costs 1,899 1,965 Other lease expenses** 32 32 Auditors’ remuneration – audit services 11 11 – tax services 3 5 – other services 3 2 * These impairments include ECL on the operating lease receivables in relation to the forgiveness of lease payments, i.e. rent concessions granted to tenants during the year, under HKFRS 9 of HK$319 million (2021 (Restated): HK$432 million). ** These expenses relate to short-term leases and leases of low-value assets, net of rent concessions received (2022: nil; 2021: HK$1 million). They are directly charged to the consolidated statement of profit or loss and are not included in the measurement of lease liabilities under HKFRS 16. SWIRE PROPERTIES ANNUAL REPORT 2022 147

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