Group Financial Results
Revenue
In 2014, CITIC Limited recorded revenue of HK$402,124 million, a decrease of HK$7,623 million, or 2% from 2013. Revenue from the financial services segment rose by HK$27,763 million, primarily due to an increase in interestearning assets. The manufacturing business of the Group also achieved an increase in revenue as a result of a greater volume of special steel and aluminium wheels. The overall decline of the Group’s revenue was mainly due to a HK$33,694 million decrease in the resources and energy business as a result of weaker overall demand for commodities and commodity prices. The result was also impacted by a HK$7,190 million fall in revenue for the real estate and infrastructure business, due to a decrease in the delivery of properties in 2014, owing to the real estate market in the PRC.
| In HK$ million | 2014 | 2013 (restated) | Increase/(decrease) | |
| Financial services | 164,849 | 137,086 | 27,763 | 20% |
| Resources and energy | 51,786 | 85,480 | (33,694) | (39%) |
| Manufacturing | 71,845 | 65,582 | 6,263 | 10% |
| Engineering contracting | 17,127 | 20,401 | (3,274) | (16%) |
| Real estate and infrastructure | 31,531 | 38,721 | (7,190) | (19%) |
| Others | 64,594 | 61,722 | 2,872 | 5% |
Revenue by nature
| In HK$ million | 2014 | 2013 (restated) | Increase/(decrease) | |
| Net interest income | 121,078 | 108,487 | 12,591 | 12% |
| Net fee and commission income | 37,620 | 27,090 | 10,530 | 39% |
| Sales of goods and services | 237,189 | 271,344 | (34,155) | (13%) |
| - Sales of goods | 196,652 | 229,582 | (32,930) | (14%) |
| - Services rendered to customers | 25,796 | 23,777 | 2,019 | 8% |
| - Revenue from construction contracts | 14,741 | 17,985 | (3,244) | (18%) |
| Other revenue | 6,237 | 2,826 | 3,411 | 121% |
Impairments
In 2014, the Group recorded an asset impairment of HK$55,020 million, an increase of HK$37,341 million,or 211% from 2013. Of the total impairment, CITIC Bank accounted for HK$29,877 million, an increase of HK$14,913 million,or 100% from 2013, which mainly includes a HK$27,859 million impairment on its loans and advances to customers. The other major impairment of HK$19,500 million was related to the Sino Iron Project in Australia as a result of a significant decline in the price of iron ore.
Net finance charges
Finance costs increased 17% from HK$9,487 million in 2013 to HK$11,054 million in 2014, as a result of an increase in borrowings both at CITIC Limited and its subsidiaries in the non-financial segments, as well as a higher average cost of debt during the year.
Finance income from CITIC Limited and subsidiaries under non-financial segments amounted to HK$2,250 million, an increase of 13% from 2013. This increase mainly came from interest income on bank deposits.
Interest expense capitalised
Interest expense capitalised was mainly attributable to the development of Sino Iron Project and real estate projects. As some of the facilities of Sino Iron Projects became operational during the year, the interest expense capitalised decreased from HK$7,066 million in 2013 to HK$5,874 million in 2014.
Income tax
Income tax of the Group in 2014 was HK$18,000 million, a decrease of HK$2,941 million compared with 2013. This was in line with the decrease in profit before taxation.