Group Financial Results
Revenue
In 2019, CITIC Limited recorded revenue of HK$566,497 million, representing a year-on-year increase of HK$33,212 million, or 6.2%. Excluding the effect of currency translation due to the depreciation of the RMB exchange rate, the year-on-year increase would have been 9.3%.
The financial services business recorded revenue of HK$222,316 million, representing a year-on-year increase of 9.5%. Excluding the effect of currency translation, the year-on-year increase would have been 14%. In addition to the stable growth of CITIC Bank’s asset size and the net interest margin, the bank card and agency businesses also rapidly developed with an increase in net interest income and non-interest income of 13% and 15%, respectively. And the proportion of non-interest income was continually increasing.
The resources and energy business recorded revenue of HK$94,951 million, representing a year-on-year increase of HK$16,229 million, or 21%. Benefiting from the increase in prices of commodities (including iron ore and niobium) and active expansion of sales channels, revenue for CITIC Metal Group and the Sino Iron Project increased by 34% and 15% as compared with last year, respectively. Revenue of CITIC Pacific Energy and CITIC Resources both recorded a year-on-year decrease respectively due to declines in the volume and prices of the power generation and crude oil businesses.
The manufacturing business reported revenue of HK$119,328 million, representing a year-on-year decrease of HK$2,611 million or 2.1%. Excluding the effect of currency translation, the year-on-year increase would have been 1.9%. As it intensified efforts to explore potential production capacities, CITIC Pacific Special Steel recorded an increase in sales and revenue. While revenue of CITIC Dicastal decreased by 6.8% on a year-on- year basis due to a decline in product prices, the sales volume of its aluminium wheels and castings obtained growth instead, and its aluminium wheels have remained the world’s No.1 in terms of production and sales volume for 11 consecutive years.
The engineering contracting business reported revenue of HK$23,373 million, representing a year-on-year increase of HK$3,673 million, or 19%. CITIC Construction and CITIC Engineering both grew rapidly in terms of their EPC business. CITIC Construction recorded a year-on-year increase in revenue of 26%, and its domestic business has accounted for over 45%. CITIC Engineering recorded a year-on-year increase in revenue of 19%, and its EPC projects and survey and design business achieved a growth rate of 21% and 15%, respectively.
The real estate business reported revenue of HK$5,943 million, representing a year-on-year decrease of HK$3,025 million, or 34%, mainly due to the Kadooria project owned by CITIC Pacific Properties entering into the last period of sales and the decrease in settlement of CITIC Coast New Town project in Shantou.
Revenue from other businesses amounted to HK$100,546 million, which was basically the same as last year. Revenue from the McDonald’s business increased as the number of McDonald’s outlets in mainland China and Hong Kong increased. Revenue of CITIC Press continued to maintain rapid growth. Revenue of CITIC Environment and Dah Chong Hong decreased by 28% and 2.4% respectively influenced by decreases in settlement of EPC projects and sales of consumer goods respectively.
|
|
Year ended 31 December |
Increase/(Decrease) |
||
|---|---|---|---|---|
|
HK$ million |
2019 |
2018 |
Amount |
% (excluding the effect of currency translation) |
|
Financial services |
222,316 |
202,949 |
19,367 |
9.5% |
|
Resources and energy |
94,951 |
78,722 |
16,229 |
21% |
|
Manufacturing |
119,328 |
121,939 |
(2,611) |
(2.1%) |
|
Engineering contracting |
23,373 |
19,700 |
3,673 |
19% |
|
Real Estate |
5,943 |
8,968 |
(3,025) |
(34%) |
|
Others |
100,546 |
100,920 |
(374) |
(0.4%) |
By nature
|
|
Year ended 31 December |
Increase/(Decrease) |
||
|---|---|---|---|---|
|
HK$ million |
2019 |
2018 |
Amount |
% |
|
Net interest income |
147,788 |
135,889 |
11,899 |
8.8% |
|
Net fee and commission income |
58,317 |
50,393 |
7,924 |
16% |
|
Sales of goods and services |
344,076 |
330,288 |
13,788 |
4.2% |
|
– Sales of goods |
293,731 |
281,911 |
11,820 |
4.2% |
|
– Revenue from construction contracts |
22,853 |
19,906 |
2,947 |
15% |
|
– Revenue from other services |
27,492 |
28,471 |
(979) |
(3.4%) |
|
Other revenue |
16,316 |
16,715 |
(399) |
(2.4%) |
Expected credit losses and other impairment losses
In 2019, expected credit losses and other impairment losses of HK$95,746 million were recorded, an increase of 27% from the year before. CITIC Bank accounted for HK$87,869 million of these losses, including HK$78,244 million expected credited losses in its loans and advances to customers.
Net finance charges
The finance costs of the Group in 2019 amounted to HK$12,703 million, a year-on-year increase of HK$409 million, or 3.3%, mainly due to the implementation of new lease standards which caused the increase in interest expenses related to lease liabilities of HK$684 million.
In 2019, the finance income of the Group amounted to HK$2,264 million, a year-on-year decrease of HK$465 million, or 17%, mainly due to the decrease in interest income from bank deposits.
Interest expense capitalised
In 2019, the Group recorded capitalised interest expenses of HK$349 million, an increase of HK$174 million as compared with last year, mainly due to some new mainland China real estate projects.
Income tax
In 2019, income tax of the Group was HK$17,827 million, a decrease of HK$1,117 million as compared with last year, mainly due to the increase in tax-free income from CITIC Bank and other subsidiaries.