CKHUY - Earnings call transcript Q3 2021 | CK Hutchison Holdings Limited

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Operator

Good morning. Welcome to the live webcast of CK Hutchison 2021 Final Results Presentation. Today, our speakers are Mr. Victor Li, our Chairman and Group Co-Managing Director; Mr. Kin Ning Fok, Group Co-Managing Director; Mr. Director Managing Finance Mr. Group Sixt, and Director; Deputy Frank Managing Director A.S. Dominic Managing Group Director Lai, Deputy and of Watson Group; and Europe of Malina Ngai, CEO of A.S. Asia and Watson Group COO A.S. and of Watson Group.

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Frank Sixt

everybody. take our shows speak will in growth away interest They growth Page welcome, in healthy straight Well, which earnings. Okay. net in well presentation, X I growth before healthy and EBITDA, the to tax, you for with pretty of financial the healthy healthy the revenues, earnings themselves, growth of summary highlights. in

we course, of terms fluctuations. Of other among benefited XXXX, Fairwinds, have things, in from currency during

That's but XX% And the local final a that's little so, numbers takes per last share, per payout XX% good still reflected lower. you us that has And and same of dividend see in for currencies, just XXX, are XXX in are is share, increase. earnings the lead which year to several in the bit increase a for applied years. dividend the been ratio which the a to total a

this debt and higher euro ratios, denominated and -- by we have the the Our because page, the points. the seen net because euro side net currency debt the on two detail go earnings in to proportion than to on go And we cash and net into months side, recently. reversing XXXX, we net sterling which later we're of that denominated itself euro improved in next Basically, over wins and X.X more percentage year first focused debt But the that course, total course of through capital a assets, do with declines sterling If EBITDA. the go favorable liquid can already is the on. ratio of of this particularly and as for we'll debt on is against we've

that gives we of better are - a by use we real proxy pre that distorted because think cash IFRS performance, for Just the difference numbers all you basis on the lease not on a reminder that between accounting. a underlying

EBITDA currencies. The rules in So XX% sectors local of the in side. XX%, terms on geographies healthy up a two the in reported is circles and left-hand attribution

the you a reported been one-offs, because non-cash non-cash the number and in course, recurring again inner to from you in different once Just with And major which the will But to gives of the the the as are picture when impacts minutes. the Italy. have they the call they what write-downs, through sales. associated the few earnings circle like, movements Co Husky cash of be picture, recall, circle have Cenovus of little you things periods a bit gives Tower include outer that within a for going write-down proceeds

thing only Kong proportionate to than much terms Mainland, terms in in years. say a in really of The I been spread. that that in prior Hong lower earnings our not have So little observe, in would geographic is, and

in over and basically XXXX. the visual year-on-year side, just I fairly trends Retail be to one-off changes go Ports component at explained think, right-hand when you that by looks we taking consequences If which out in the Division. will division, through the natural by reporting. the go start It's we

to HK$XX.X get So EBITDA underlying XXXX that billion. you an of

you healthy see, ports As on very the the year-on-year. can contributors are of these upside contribution

year-on-year got we CKI way by that for are growth a because showing healthy very essentially that EBITDA. a accounting of also Retail, is We've decline Our year-on-year. the

clear operations, perfectly the CKI is out the when of made is to record ventures, which get by from take profit in effects last from it What companies X% share, was metric from year. excluded up you from most they billion, probably one-time joint actually, they the operating dividends and the if sale the increased both their non-cash they the funds from a you remember plus business tax their on assets cash Portuguese their dividends the you Our look year $X.X of relevant course, by XX%. their wind that deferred plus announced which if they at, proceeds in their results, the that associated activities, essentially up years, get

Group CKH Turning Telecom. to then

and adjust non-cash its Tower there's And loss course, in then a pieces. of the year, reserves Hong it course $XX.X closed merger took EBITDA that We took a dollars. that of relatively that some $XX.X was year-on-year Kong when Tower Kong the of the this presentation. recorded January a up level, you As for the exchange we it Co. EBITDA the a and with transactions Co. decline, as in that of Xst completed later end its carrying reported not Indonesia from be be on big merger you Hong impairment as dollars are in gains is, to course, as suffice of think place of Co. to terms EBITDA. are But soft an The the on lot see And year-on-year. performance of the and Italy, you but payments, know, UK impacts, one-offs talking Co. broadly XXXX sales was [Indiscernible]. Tower we'll net is billion with in contribution. year-on-year reflected HAT, to the is Husky up billion story The contribution. we on the will say speaking, terms detail. were result of reported paying there. the minor Cenovus, relatively its on course, impairment, pretty in the speaking Tower and value, that's moving there of we can in EBITDA the And lease underlying costs as impact contributions all operating about impacts a really modest of in and I say real

write-down recognized we also of of in any next to the usual, took their we slide. looking as in refining share was If Hong drill our one-time our to a can at assets. operating that in But or only here, go we're but And of We Kong relation what XXXX dollars. that down flow. items. $X.X the is share U.S., Cenovus on stripped cash exceptional billion

operating spending in to real trying we're look at flow So cash real and businesses.

enhanced billion billion, the businesses, second bar that right cash-generation you down is performance. can XXXX. As that flow operating the to slide, the I free than contribution under But retail right-hand note significantly is because Hong X, just you X.X slide, divisions. for operating in on it can to think by not to it investment note on is way what to billion go looks XXXX it's XXXX amongst $XX.X higher from does, at was year. course, primarily U.K. was we in across at equation as But billion which of a flow CapEx the free bit to take the Kong cash than of same foresight higher is really of the spending worth I license various costs except it little the by cash side allocated Slide the in businesses, much next $XX.X the XXXX. billion see, of $X.X each incurred last HKD. tune course of the then the of from balance of we we in this, If and telecoms If And to did and in in comparison time more of offset of actual the $X the

adds of dividends, subtracts minus but ultimately, division, the subtracts So license CapEx and -- the also EBITDA, telecoms subtracts investments. it EBITDA looks back license associates the at investments, from the then EBITDA share and

by quickly more So spend if mean, rate twice interesting. I ports than we CapEx division, XXXX. it's go in the very

spending Dominic three increased division. have free and there, for go sure we've to a the increase showed still, talked seen flow. in retail Infrastructure, that's CKI Again, got I Malina CapEx for X% that I to last number free I'm retail. will But [Indiscernible] operations, which XX released cash talking advanced 's across from healthy And flow already But what by spending the operating that's flow the go them. the So to But back will by we've XX% technology cash breakdown to was and go year. about find it of [Indiscernible]. most the think Again, in CKH funds decline be was the and about. and [Indiscernible] statements operating yesterday. was we up number. that actually CapEx that. then O XX% and investment, Group financial across been team I We X.Xx, a and XX although free licensed investments against year, cash the for increase, in the a there. Telecom, think note nevertheless, important [Indiscernible] operating you of that then, If is

decline not cash it's flow So operating have XX% Group surprising in a roughly CKH we Telecom. really free in that

say, numbers if be redundant very merger reflective particularly partly group the to assumption ahead. HAT as merger careful of, would on CapEx I spend in was that in not the network the Indonesia, As is in we went here the into lead the

that why the of any Indonesia. Which the Cenovus on EBITDA movement the course from finance is course, those less observations attractive think is and performance improvement but improvement over I largely sum of of in share in reduction Energy, a is year which movement. ones the And not lot to the operating from it. cash reflected EBITDA driven investments previous up had that, the of dividends. and page. things most came all moving the numbers free in apart But finance capital the But they're so, don't the as than spending by looks And significant in flow we lastly, then the investments, of

you to cash the from our that year-on-year. with we last real then the the interest which on actual flow to operating an start had improvement expense away next from obviously flows you XX XX in was free free slide, slide, year, Looking take the cash

the the the which course then, we received year. from in, during deals tower that add of the cash You closed proceeds,

to be Part an adverse payables, some working it takeout reflects in to some Asia I I as sum actually we related receivables cleared over of the been Illuminator from than merged and the Other the The Your waterfall some think division. reflects think, that all major has Telecom, that right, think billion, the our the And that needed out are ports of the by concession on post-merger, also self-explanatory. to clearing variances. right, left. extensions And company. replaced merger. particularly before that, which, on capital Hutchison the Indonesia movement $XX.X and explained I I pretty well go the in

any later has anybody So if go on. we to questions

our start we at slide, financial by profile. still very saying, take healthy. Next I a look would maturity debt and

On level and the left U.S. Dollars. of side, euros strong billion, it are X% in Hong and caching is held is part Dollars -- of with $XXX.X the a and of GDP. last And was held at most Kong assets in in that X%

well, to year. rates our the, was liquid significantly it Going where on year. surprising the has of was the been than last over across interest return and lower Not cash assets course the

So where the of basis straight average we well. on on return cost of bottom right gained behind on our the liquidity terms we're basis XX I'll across the points the in as but XX points debt go

anything So period, certainly two, adverse slightly not concern. the between in although to in cause us spread

that HK$XXX.X billion, sterling, is euros denominated the at total there why debt again profile. favorable Turning of in denominated terms in net is debt is in gives euros, in XX% decline us to which X% the

in mix, we know of not as improved that idea to the bad will before to have we've continuing here was I been XX% that end because sit other So of remind is go at XXXX. we towards there, rate. Maybe among the levels but things more that from fixed of move it a already terms

rate at was we rate the the year in of that's XX% that in floating as So end fixed XX% in XX% and and XXXX. ended against floating rate,

will a that Maybe the little of group a in of net sold are data rising $X.X an $X recap find basically which represents earnings HKD environment. the a in in sensitivities recurring in X.X%. earnings assume the EBITDA XX% from reduction our -risk of in and reduction in an liquidity flow after-tax, HKD, of Again, net euros in terms XXXX. in profile profit result reduction in billion $X that just So billion those particular XXXX idea fluctuation a exactly you'll interest some to good section sensitivities reports. is all which same But will in de cash billion result bit rate

vary earnings components. is So against will the recurring it the actual sensitivity somewhat, but tested

in from little of CapEx and think driven of a is the net In that by self-explanatory the it's half. change that deterioration A a by XXXX, fairly absolute summer at maturity moved you from debt, partially than I XXXX. partially assure ratio I I average can today, no year-end that, spends in but amount. second from profiles terms -- eight and our of amounts the stands And of can in that improvements tell Other ratings, years. licensed and significantly credit is, currency driven lower also bit

capital terms no credits. issues maturities was which last that market that, largely it's there, in The weighted, on relevant -- to is year. other Just the those rolling quite terms of there a they should [Indiscernible] self-explanatory, note be of market bank maturities the than I than around run-off that means longer it particular maturities, of in bank near-term are left, think maturities,

I'm us? So have there ask I stop Ning and think to Kin going whether joined

Kin Ning Fok

Yes. listening. I have been

Frank Sixt

Thank to deck ports. are you God because do on

Kin Ning Fok

come a then [Indiscernible] here because it. too little can you bit finish early

Okay.

has [Indiscernible] the a Now, story. port

then, XX.XXX actually, XX EBITDA EBITDA [Indiscernible], -- was XX% July non containers million, was six XXX [Indiscernible]. we [Indiscernible] was And pleasing, cost In X% billion, XX -- is in of and there and there very XX a XXXX, just of million XX.X a very, handled to [Indiscernible] XX and Okay. increase total increase an billion, remind asset countries.

a have help currency. from We huge the

XX%, which pleasing. very at local well If you look is currency, is

because then are sold our XX%, only Kong, -- chart, on. [Indiscernible] going The negative of to Trust everything very, the EBITDA, only Shanghai and sold did and reporting. Barcelona, less they side very in well. slight all then, or we of Hong basically, The Mainland well ports is one, Australia, here. Hong is pleasing. this and America okay. well, course, the still we and because the in of have is year. is their go is very than Rotterdam better year, doing If the the And on very the in But so us we good, Kong and red doing they actually Asia, Mexico, well And the we last it's then, are the we Europe It's we corporate the actually and and doing you same, an is have so more well they doing China have doing is partners, and have so are side, leading basically. charge. Indonesia, they port. a have are made they we they Thailand, right-hand investment good on XX% XX%, XX% give company Again, Shanghai now why last [Indiscernible] [Indiscernible] that all shipping income. increase

works disruption, spending. push. and of everything course, is also and of wonderful doesn't meaningful you income, is collect a the So as income, which explained box see But that is storage exchange call [Indiscernible] fast. we going lower, there us. can land good press business us side quite the the course, gives a quite for is a up, we foreign move -- and conference, [Indiscernible] then the the when I this Actually, which the land then in just

should take So maybe responsible I page. result through quarter performance was to is the by in as very, retail very Dominic a the one, pleasing. think the retail Dominic, Go XXXX this of

Dominic Lai

you, Okay. recently Ning. Thank good Kin Retail, story.

a sales of nearly our XXX strength beauty loyalty and With in almost with member indicating strong members, participation exclusive the China sales [Indiscernible] stores, international exclusive worldwide loyalty the a the is and strong differentiation That operating uniqueness the has creating and sales H&B, from XX,XXX include our world's next, the programs. participation, Still base banners attractiveness being markets and the total means XX which And and we remains of XX. largest at called XX Slide of XX%. a XX%, retail of have in million product came high member sales as you It XX% While has reached for high under vote what highest division Brands. health retail brands participation record XX%. retailer, business. the the from own and with

only. only So to customers these network products can get our own

been Our customer value and sales to lifetime model, proven increasing very has effective the business it be O+O in growth.

both in elaborate Why unique? so with is to shopped much is as simple our customers either, and because customers as data online, with to only me and shows language, us important not the So offline we what Online. O+O? times our Let three it in that stores. CRM want both and our + spend name is, customers is important implies very who but as an strategy. our O+O plus X core Offline up us physical X shop

observations to and these very data So this basis and unique, short, forms sophisticated. seamlessly the and implementation that create shop across anywhere. strategy. ecosystem involved. offline of digitally our worldly online open-source any anytime, There's of But open-source allows core strategy In the is customers integrated enable, of channel lot to have a we a technology

like If will Officer Operating Chief have and you to be I more to explain happy to our details, would you.

move let's the year. the to center Now, on of

of a mostly and of in of new numbers. year resulting on the less the a stores, year, average them have stores, So opened XX net than during XX,XXX we XXX or increase X%. I estimated The stores, an have period underperforming the Asia but mere in we new XXX in surface, closed fact, China months. stores actively store have X% increase We XXX with but have ended also stores, payback

in of stores China. between Asia is XX-XX the XX,XXX these and So split particularly payback Asia. And fast Europe and

reported billion, in and EBITDA XX% Asia. split -- in $XX,XXX an or at reported XX% X% in local in increase is currency. on then XX% Now XX% Europe, EBITDA representing EBITDA, currency And as of

growth growth border EBITDA go right. Now, in local division for shows the The chart of let's each currencies. EBITDA

For division's Beauty of for it year-on-year. Health and XX% EBITDA, which XX% the accounts grew

XX% the Beauty, and grew Health business So year-on-year. core

blocks me through these one-by-one. let briefly, go Now

on conditions China in were relatively -- Beauty has first last For Health pandemic the stable. and the year encouraging of half China, left, performance the delivered a for very when

However, in affected XXXX, heightened and the which our national second the portfolio. significantly customer’s regional movement half by affected was restrictions negatively of business outbreaks

So you the million, by EBITDA or slide the $XXX XX%. for result, as as the full-year can on see increased a

restrictions. COVID the severely So half a half, but was first very movement second the good by the and impacted

countries Now, Malaysia move of in to to Hong Philippines EBITDA reduction Asia, Kong, the with tourist Kong. Hong [Indiscernible] the Lawson's region, the controls the These, managed significant and deliver the due Despite like, movement Asia. the to increases. losses together because doesn't anymore come in in

in EBITDA year XXXX, So a And to growth due year-on-year million it a and hit $XXX held X% XXXX. been up the was result, has the or reduced the loss significantly. Asia. fairly But as is

well Next, period. and and for Western units business happy increase to EBIT. where Western Europe, open the down during that reported the did the Especially report Benelux countries and in remained all in I'm Europe Germany, lock EBITDA stores

and to have remained they open then, close. non-essentials So

of of HK$X increase to as EBITDA XX% in billion, by Western an So increased divisions, close a result, this Europe, local currency.

been So where increased trend of pull for that as see strong is good retail. because million negative, the very a has good. Rosman similarly, and off the Poland, EBITDA or Europe, XX% in $XXX Western other there's Europe. achievement The you next trading Eastern predominantly

Hong supermarket million, operation in in to has that trading returned supermarket XXXX. in the the in due a pennant the division is fact or Kong by we normal of because this drop super-normal XXXX of $XXX Here buying mainly see to customers our

back trading in XXXX, and in super-normal XXXX So normal. to then

I of total as with million, $XX.XXX course of EBITDA the gain $XXX retail and of XX% our lastly So the to mentioned, billion. increased division EBITDA

level year, overall bottom XX% the to health Asia of retail XX% margin Eastern previous at at margin Western and finish beauty to look highest X%, and Europe, EBITDA increased chart the XX%, at and division from health margin the resulting as X% year. in for you an beauty same previous if remains stable the at XX%, for the double-digit China, EBITDA slide, Europe EBITDA So

So talk it to and about infrastructure. story, I to reasonably pass good back Kenny

Kin Ning Fok

Frank. to pass better think I Well,

Dominic Lai

Frank. Oh,

Okay. Yes.

Sorry.

Kin Ning Fok

are earnings take take have both not up components own CKI us, the stories, to cash announcement. that that by can't of CKI a if operations 's ventures of much healthy that of course, regulated up deferred Okay. X.X% that the Starting that comfortable coming all to debt pass Very we on reported as healthy from funds that it have it year-on-year. course, the with prudent, see. co-own value from for own dividends And tax is to EBITDA, you really, Again, non-regulated look share the recurring else to of impact our you the their of associates the in assets assets they we're like reminder their that underlying anyone ratio story that Portuguese the sale with I and from a income way given earnings, the ratio non-cash is years coming including in that that our and borrowing this through you actually the of that was were I joint asset up add, Anyway, profile the out cash the can ventures, and we see year. dividends in XX% coming joint wind is cash leverage in to. what in net very high you the can [Indiscernible] out out and to still solids looks tell portfolio. and CKI. [Indiscernible] the number Reminder I there, just results six of and we the or businesses, a associates look from and very levels that their is XXXX, obviously real

the to Just is reset the timetable important. right, looking over far regulatory very

resets telecoms. over year. the And that, for year pass that you. Telecom will easy out has looking I'll number considerable XXXX not Ning done of spread of Kin the are tells impact talk call an initial results about pretty it well in this absorbed pretty healthy, it's really. that and which at we're is And see, can you As XXXX year, a with to who

started business, a stayed lot Ookla side, the spectrums is is being rated coverage XG one and as in by European now as up than And Ireland, -- disadvantage Italy on went our Austria in you when are then Sweden, spectrum, away of You And of get network. and company fastest getting enough and we is up the high collection not as -- FDD UK. active ARPU lot by through XG in show will network then, lot [Indiscernible] the we else companies is our our quite and UK because flat. this UK. that are ownership. and then take a margin, in that XG if good [Indiscernible] to other the course, then various there brought revenue challenger, anybody one left-hand customers own auction UK, spectrum in lockdown. we then, and we the the also have Austria, and have that the longer that course, the In of AMPU, new that also Denmark in and we saw the obviously one in that major for up auctions able the X% Italy, in of our most -- X% the and being we're of thing have so then, look not on thing if to able then, more other business. at And that And competitive. XG And people And -- competitive done and of done XG going you a top XX% still has we UK, a merger, than are spectrum our that the are of who is spectrum been as this year we Ireland, recall,

just so in And we billion Kong CapEx. we -- I'd disadvantage spend $XX in of -- in because more XG. this two you and situation, those did spending of And for now Then top then is disappeared. approximately network Hong say in our should then eventually then the last the and have And years half XX% of spending full in be the and our you will spending to line do if we CapEx. to middle And are EBITDA the we XXXX And go like market, of CapEx -- can business. goal in achieve that sold of the I you from CapEx, because this then, year have called chart. [Indiscernible] you And will you then done the year. we we the XXXX. to not-too-distant-future, And we look go next at think, And Okay. tower depreciation, Actually, [Indiscernible] that. it our see And confirm the and those

so now that a that So they we an make adjustment. make comparative,

So XXXX's then XXXXX. the in and order at down. XXXXis compare to --in to EBITDA that, the bar, that is And third see after you the up

than And was well happy are is on first than a I'm I then think, -- not see the and was performed second-half. first-half. very half. less to This do actually bit not by from report little the that base the -- keeping in it currency that X% you doing the we market, one mostly better Italy. competitive the happen. But in EBITDA our Actually, that much actually a because come local is XXXX A -- things there's two why and [Indiscernible] of milestone. view factor. some money so the some we lot to income wholesale are income another income bottom, reduced, two And customer because saves the us out also network, And offset a we of up is see bottom we that have then but been and is the already of one that our course, see Italy. we in the as because is are know can co-operator the network giving they we major [Indiscernible], and they they effect this

$X X.X billion reduction, reductions So in billion Italy recorded see $ the XXXX. if chart, EBITDA you'll a in against

reduction and then is or pleasing at management you then their you the is UK and new well. one, actually then we're of then the second first And last net see look half the in nine because So growing and is and is the basis, seven that other years. fact, if turn finally postpaid doing debt start team the around, the

that so see And million actually debt pleasing. by half almost we million, in EBITDA and HK$XXX a so very net have contract. So very, is can that then this of is better so

percent, more So is COVID. the sometimes all affected less because other by or

so I'm in we settled is hoping I to business months, -- basis started in down two increase the Some I XXXX, all, think, that all the think see for reasonable in first and even the actually. actually in and then factory Italy, in that

So margin, and XX%, see if to at then EBITDA we you look will XX%. the Italy have UK

Italy, -- the we -- have we adjust that Sweden, little to lower because Co which it's to country bit to and we expand, Tower for of some didn't it for if the So a have like is -- have. Denmark Australia,

would So how do [Indiscernible] see XX% is Frank can I this back with And in think Frank? then, it try XX, Page and XX, [Indiscernible]. let's nevertheless, these Hello, detailed. bring in we goes. continue to adjusting to Page to

Frank Sixt

the and to or transaction I QX we conditional their -- after button had clearance, in billion the earnings, will or proceeds of QX. see Sanex, you with increase €X.X on years two clears almost the we total in, believe either corresponding can in QX, QX as bring for CMA, finally of obtain complete slide, the on. But which process with yeah, Sorry, mute us did the way approve which

and does between about of have proceeds we Cellnex, The as €X.X the already and which XXXX, process and conditional completion remedy As the approval €X.X a billion. collected against and earnings what the packaging. to is of in that's and is XXXX CMA reminder, implementation of require the billion

closing of very assumed based and or in does revenue which but stand realistic all affect in don't it is still in QX clearance timing, package, [Indiscernible] our is QX it's why to is course, the transaction. Of so way, the of which actual the on circumstances, the terms we an

there's already also of with half. Italy under debt Telecom distribution CKH in Telecom Group the received. in sorry Group us Obviously, from save We're that's made reduced $XX we distribution. the allowed CKH, HK$XX.X significant CKH shares in and the license and And prepayment also by some million at debt proceeds million back -- a XXXX first after done reduction at money share terms CKH In of we voluntary we've that what buybacks. which to euros, doing the to

in merger to to going Kin, with I talk will Indonesia. our So back that you're about go

Kin Ning Fok

you all why financial Frank, over? figures. It's take it don't

Frank Sixt

merger, how - left this I achieved was on ratings structure outlooks. post-merger. revenue years was grade than times. about company think dollars. between $XXX U.S. you value from a and We implied years was Fitch million is BBB the the of investment the $X year, more side local million between dollars this year. many rating be shows agency, we've of $X the beginning billion at achieved think and and gone run U.S. but with U.S. a hand billion stable of dollars the five a $XXX synergies The The the three looks and that merger rate from The enterprise shareholder [Indiscernible] which has pretax from should not good start through realistic

a that the had night So of partnership the really A very position merger we picture, in and good the day terms CK think, Indonesia strong has very in from position that before Qatar. I partnership, and Hutchison [Indiscernible] post-merger.

partners equity we've local an well. control the potential we us As XX-XX and which as our are block gives you broken X%, can interest additional indirect basically see, in

years hard So this was work. overall, great after three it at of done again least get to

Dominic Lai

but finally think. a Henry, term process, get we it over I instead it's the long of line

So we are so happy.

Frank Sixt

as climate. and years, renewable the subsidiaries CKHH other group, circular overall. over the CKI We've So are objectives very spent does -- sustainable networks, of economy. slide between XG what are. than on a the Slide around The an we just roughly change, we on spending Reminder, positive transportation, have actually efficiency, and [Indiscernible] where that's totaled which course just Jason, XX, employment update focuses billion really impact one of and but to USDX.X go here. CKI environmental the accelerating energy, energy those on we on three excluding last the itself, split

advanced target. already pleasing initiatives Very see as have and footprint. been continue other we of retail three at progress lot action which division, to sustainability of in of which can terms So are we pathway in dealing three particular the to of all in the a completed be three targets, scope in you the have scoped all setting divisions, we're doing its is been in and chart all net stage goals is where aspects is out that those key showing climate a our understanding you zero and and science-based is developing with an in change, of developing of what in telecoms,

ratings this, So all the agencies. of by has actually recognized been sustainability

We doesn't great. fall that that [Indiscernible] who very a XXth their from the into the medium is category. XXX.X, improvement is it people a best So into that, second they've category, category, from given their for Except went sustained it rating XX.X it which the all we've is in best analytics. APAC, score of got globally, and significant high-risk of risk sound all

we good has B we us. MSCI, really So what where is folks. started from rating those think, against outstanding with progress an outrageous still

with We them. been working have

We are call substantially. -- what score, raw seeing what our improving they very we

be will We over couple the too them. to much improvement months. next that we from are in think a course of this, of BBB our of played rating, entitled view own we Our the out got

us rate was thing the bond, the in years last our green validation interest that ensuring all XX which during a issue an X%. and other did, €XXX The also of first of course for we was at year, million principal,

So that's Kin XXXX going [Indiscernible] And our cover the brief then sustainability. think, you're to I Ning, on tablet outlook.

Kin Ning Fok

of course, mentioned And know outlook favorable. looking economic shareholders a almost business shareholder return. want in we will is XX% of we seen page after least achieve share figures. to one, much especially supported is not by And is because to very item. tricky money EBITDA used the XXXX part -- not off be not are focus the finalize last buyback. market page you look the own and write the money until need will basically, the allowed receive Chairman trade the then, because very and in this as we want in a the them balanced in what [Indiscernible] And -- growth I but rest Mr. at press of for we'll hope the This and growth which then that Europe, to then conference, we've the every so the too is are still the -- the for that to by for telecom Lee see I see returns also the the top I we But very because the of

We looking are to easier a the were consolidation [Indiscernible] especially for to we then main do. it, thing are in want These we in-market not but give how very UK consolidation. when it selling then do quickly. signal say that And the about I just

to earn we our you side, almost that XX% revenue Indonesia, port year, of is there either then income can on where storage as And business And [Indiscernible]. of like last see income. was the comes [Indiscernible]. of also from plan have would Australia, On this in our where income to capacity a mostly we we going have course, And expanding needed then forward. before important it's us in seen Thailand,

actually the so well fill side during seen as then that opportunity. on will no and Beauty and interest -- void. in -- CKI Health business. And that more 'XX. will inflation. then you the that that and assemble we in our XXXX, then on they and yesterday, no for then have and for There inflation the thing Okay. be And towards will Asia European [Indiscernible]. European And good [Indiscernible] see the business of then CKI always can so we as then, And business a arise, very side, rates, is have resetting increase 'XX, and predictable look come Higher the China course,

And another in is in very I original then at are year, brand to program driver. and to the stick XX%. work they Asia went a perform. January, this our key can doing company. there's continues quickly, will they because is This So lock we XX% their the X-day, in business EBITDA Hopefully, and reopen down. we already the on then one then, that down will the again, it one of one sales see over of And especially this, lock and hope week will of that target, our is And country the platform get they forecast China. then -- side of the exclusive in will this can and China, very then, and February, well. course, up our also owned the And success now to O+O target

last we but in time. can And said reset I not a least, the no we about lot think, telecoms.

UK, are growth, they EBITDA So XXXX UK on you then start in think making are can but they not good that still now, I will EBIT. but on see EBIT that growth

we the already customers, X.X [Indiscernible]. investments the of [Indiscernible] to growth then EBITDA overcome Now, will in our because Italy. then, have and We brand that million the because do of EBIT, started And network in the going second course, you back then we January, and depreciation repricing. and expand, seen

And in that's [Indiscernible] spectrum is good through able the of competitive, of have year company. the is last XG at in spectrum from as last course, we also that spectrum this various before, in through then, Italy; see XG a able business least least, spectrum thing. we to the then And good but we side, the a year. network, our a Denmark, together said mergers, accelerate Italy, has spectrum now You'll And the get able buy [Indiscernible] and are we're There and action. auction it we Austria. [Indiscernible] have are most. and then started we're not BXB been UK, And lot in UK, Ireland, and I so will Sweden full forthcoming to

on We us course, will XXXX foundation you I target. what career course, and think of Hutchinson's of performance has lot of the from good is in our result. both of during [Indiscernible]. been beyond all deals in should a income. profit derived we XXXX my income a of [Indiscernible] M&A see recurring reduce look and And into And, getting this give then, our

net be then profit. is continue then on So will of a our of our mind. that on put And flow recurring And top will special course, cash and our always team emphasis. emphasis solid

much. balance a very below shareholder then the been have which return. least board deal that the return. something You not XX%, good Why? you shareholder and Cellnex saw I asking say have with know is us that we that all what the -- a good ratio will shareholders close we our the from we're one support I last decision collect I And that can business shooting more go sheet, -- hope is Thank for after board will that This the for. and but good debt

outlook. near-term I think this our is

Operator

can side right-hand Q&A the your Thank free feel box to Please of raise you. now which We session. the on screen. chat lower begin the is at you’re

question back to Will CKHH The dilution to continue capital on the buy company's EPS power own is is sales? shares hierarchy about the avoid its first allocation. What allocations? of

Dominic Lai

I think accretive earnings the top the flow priorities businesses. engaging cash in must and be

payback from buyback infrastructure with and quick For CKI, we allocate of the like for example, per of under Tower But dilution some Tower in debt retail investments. new Thank sale, stores periods, to of also the new in-market you. earning avoid share sales. repayment with new all telecom terms capital share the consolidation, completion projects of the the

Operator

the Thank the you. of The outlook growth XXXX? next question, And will in resume what is EBIT UK? it

Dominic Lai

can you Ning answer Kin that. Maybe

Kin Ning Fok

the we the have I basically first-half as a think as the first-half business. then the saw [Indiscernible] the the was actually in good freedom And situations, explained the performance think then second-half started, I the by and flat. briefly here and EBITDA I then UK, the the above net is But minus current trends, UK us, is gross have market debt and XXXX, the that net growth also net we debt for on most UK significant it's actually the the in nine XX% and best in thing in years. then the best second-half. year-on-year And

in XXXX that before. customers which So seen XXX,XXX we the in we A about contract. never add contract

operations better, is doing And then is network doing better. so and execution then our our

again to good. that of the would go growth to expect us we UK is back see sign EBITDA You'll because growth business

have on UK. quite that So we positive

Operator

Thank you.

time? Our next in-trade big initially in question, the on What will on [Indiscernible] demand to earnings still reverse give, is Italy.

Victor Li

Hello?

Operator

I will repeat the question.

Victor Li

you second. I lost Sorry, for a

Operator

in-trade repeat will decline? will initiatives earnings to the What implement I the question. reverse Yes.

Victor Li

your Kin Okay. Ning, question.

Kin Ning Fok

And sides is that especially what off the business. But that, well, base. have is is then, -- doing in the did One, best base half. the Italy of. in now is what network been first Italy. the has the there two now, we in not half, are we basically we And have the second the entry-level in So of

has second has well And a is we we only the been in good brand concentrating started the a the -- PXP on more year. have the also, that to very will So were that progress then second -- Berry side are do, than successful been about half. called that little what we bit very and we

of than We and then be lower And able we a million lower business. which the compete January, least, not last the X.X the repricing or [Indiscernible] side exercise, that can to but started customers have we on I think in much basis. feel the I I'm this we be see on year the better year, that signals are last then the good will think start we good. And then, industry And this confident year.

Operator

the XXXX? the Thank EBITDA EBITDA you. of [Indiscernible] steps decline And of question in retail second what is for decline? next side. Health was What The half the reason the on China and the the Beauty to reverse are in

Dominic Lai

Yeah.

Okay. Yeah.

As was national restrictions. in also nationwide I and outbreak affected by recent of COVID said quite second-half this but movement the is encouraging of early the or part first-half presentation, our the

footfall. the affect that customer So

reason of drop measures. is the main these in because top the in footfalls So pandemic customer for second-half the

by government in particularly we it seen real in Chinese was quarter actually serious because fact, statistically fell most statistic, year, rate last QX see the have that national the of the protected or short. we the growth So

it. of But barely in hit was doing much on the as other last save have cart as to going we lot really So year hand, possible. a QX, been particularly actions to China

into members recruit to members, fact, also have new in O+O. recruiting members we We in to and continue been turning successful

X.X i.e. than spend members, with that with As more stores. on i.e. the times I us X.X shop they said, a customers customers online and got multiple, the times us offline only shopping physical actually O+O

And O+O China has to our participation now sales strategy. XX%. terms over also report So in that's because reached number their

our O+O. And XX%. the of comes growth sales also is XX% of over from So also O+O sales this

network, especially course, group, in selectively So we And where on O+O cities lower the China especially in our platform, very basically is are expanding we also of working. tier have the under-penetrated. and store the

online, you. the store expansion. are So also and O+O, network these Thank the

Operator

Beauty follow-up industry of you. structural saturated? China China's and same question has retail. [Indiscernible] you change and [Indiscernible] Will in consider is a Thank store Health investor China The on

Dominic Lai

yeah. No, shift in -- fact, continue. the Well, no. Please, Dominic,

has fact, shift started. In the

Sorry, chairman.

Frank Sixt

Go ahead. Go no. No, ahead.

Dominic Lai

consumers has products. shift more mentioned as number years we started the stores premium fact, physical online. The to In a ago, the of want from

all very and with powerful is the We payback technology. period so platform, open less also sales a along, [Indiscernible] in than now two network So -- that we source launched performance Actually, lower even store invested years. expansion. physical

doing Thank consumers, service experience you. So store following [Indiscernible] then network following Yeah, and market, we and our and also offer so them the are quality shopping and the expanding a XX/X expansion. network.

Operator

CKI have question next The on on The will earnings? on impacts that question emphasis CKI. you. ESG is is increased Thank negative

Dominic Lai

developed is, really water Okay. the networks, power our distribution producers. take These of majority and significant CKI 's question net no. contributors. I'll Such household low. networks, zero this utilities. The these relatively the plans. myself. as, risks assets transition probably targets quick not gas and of are distribution In answer infrastructure, Because businesses transition also view, business They're have carbon are Maybe,

the a low are in generation they from also switching Let green and as me profit see, works very the transition guests that this fired renewables of only coal for And hydrogen. as example, generation, small from Hydrogen leading way power CKI our transmission to -- has business. portion and gas

smart goals, transition. be Actually, various concerned from help They we from we lot energy too asset the this in in solutions. this, a help benefit and and the these will I'm enabler meet about as can because So these -- not renewable connecting will customers benefit they customers of our that.

rather look cost. I opportunity than as an a So at this

P&L to in be helping expect this We you. possibly in area. investing our Thank

Operator

is this openness Can O. model? in lot retail of on continue Dominic and what the [Indiscernible] can the attributes questions O you and questions chairman your your society. or a on elaborate on you Thank there's

Dominic Lai

O+O sophisticated that's easy implementation. to in say, but very

O+O I with together offline. the connect it, say the online As the to the O+O has platform

So than it's just an rather a innovation connection.

the in And if platform. some times world this from to O+O retailer products it's they -- we fact only -- implementing three around, we you customers is adopting, look of and to health So and O+O beauty almost fact buy and the who because the unique, are more investing, up that us.

connecting on we me a have them It's to just is sophisticated. tell in you, it's quite O+O, Let common essence. but sense, And commercial integrating. the we not very this just are What common sense integrating? basically, So strategy.

our warehouses, beauty The XXX global ecosystem, Okay. our XX we our loyal -- physical call online put what our ecosystem we fans, this XXX stores, media customers, million advisors. in XXXXX is XX,XXX XXX our social stores,

integrated to So and XX/X. enable everything has and similar be the journey customers smooth swapping a to for very

So happy customers. experience we want longer hours, XX/X, for trading the

integration, very a only then, participation portion well to are a group for it's is the XX% there's thought whole working about And it sophisticated is that potential we So out out and fine. because of sales have And unique. XX%. O+O our and more profit -- sales a

So both. Thank lot headwinds of there's you. a of

Operator

This still on [Indiscernible] side. in Retail for What continue outlook question the you, a is XXXX? the Thank please. That's Dominic, question big of Dominic.

Dominic Lai

been COVID Okay. But good we're have not Well, think no, first in of in we out the worldwide. two fact, growth of the course, yet I seeing year-on-year months.

friends caution must year-on-year For the sales. us I the example, from our time, same at because the had we that help been at on EBITDA, last have support analysts if as X% and trading times. the government this receiving talked the about growth look difficult you year year we before, But to doing

and EBITDA, XXX and So HK$X.X in are this then a modest EBITDA to projecting year. 'XX, year, the reduction, we this XXXX, impact billion, billion zero. we've growth we X got year still the got That but

Victor Li

our offer the you Most view history biggest gone Before recent in human on challenge Watsons. I profit. the with my friends industry to major COVID move We've retailers retail in just maybe can have analyst questions, through on possibly other for drops

own health I way, sector quality measures they reasonable company manpower showed a products. are that profit COVID the a our that we're word big growth The for maintain factors the fact beauty the shown wherein have the that platform same when two profit. portion major challenges, own through use and as a during plus many and and and Watsons to in our I CKHH. customer facing think that to asset as A.S. time These closures, from Watson still back start soon operate O+O relax, boys. show store what profit. we slightly That our brands the show is of contributing shortages, amazing shows is so the of At a resilience. COVID, men such in bounce and The

demonstrated Thank it's A.S. Watson Thank amazing CKHH. And that So definitely you. a the sense they're quality resilience. that you. fact of asset

Operator

year. follows, investment The the Cenovus an is company? How QX last [Indiscernible] as [Indiscernible] next question do in of return you the this impairment in

Victor Li

an you Frank, [Indiscernible]. Maybe the me to the And overview numbers can give I first. then help can with

and Cenovus Husky I think the merger is of a success.

both unlocks if it away is think in we oil a in revenue, recent and the value, opportunities, a Even in of in prices, rise take I reduction. the lot synergistic success. cost merger

So today it's producing is one a about and of day the oil Canada. barrels producers biggest of three in XXX,XXX

with you Frank, So me maybe can the numbers? help

Frank Sixt

Yeah.

synergies a $ think U.S. the share did achieve in contribution from of I earnings It's HK earnings have billion in about we not than a their first ways. refining achieved, an repair. terms good and straight to for that sheet We that have contribution, all, still about after when two did merger, drops through see that of balance But enhanced we assets, prospects, Canadian for would of indeed dollars we the and they they which in initial see earnings. we that [Indiscernible]. just write-off year. $X.X earnings the expected, overachieved, better our year even had announced their it's targets Cenovus One,

build well-positioned very in and in enhance have I with but you've they seen Cenovus progress balance that to as also think the continue I becoming to you business, well. a shareholder to grade returns continuous telegraphed forward sheets and investment the look one of think strongest very continuing

the be a and the we of outlet healthy but for rest terms ensuing view, point of look should contribution forward contribution, into shareholders cash 's also of XXXX CKHH as from for good years. in to returns a So earnings the

thing was other creation. The value

basis the As you times essentially, implies Cenovus at it's valuation the was of per it more X.X former a -- of Husky time today, that Husky on look if shareholder, merger. the than a share at already

perspective, the shareholder right moving successful terms contribution the an contribution flow start and value So earnings been in contribution just merger. not direction it but in from extremely has return of cash a

Operator

you. Thank

Victor Li

Cenovus, the market I the also own at that the today would to think side of XX% we roughly. like together CKHH, on the customer fact look about with

Frank Sixt

Yes.

Victor Li

So CK personal together group exit to it's general. our holdings. group group I for with in an referred important the as

Operator

Thank you.

comment I'm I'll it. the it. reported see going views? HUTCHMED? not I'm HUTCHMED on to HUTCHMED. Next a question What so face of politician, to of the was on is by the politics are on U.S. not FTC. the does focus business How group your side

facts And for listed Let's get It's are There us also the Hong London. there. -- companies list. XXX HUTCHMED, the it's for right listed two on in Kong. over in

there the it in was still -listed scenario be markets even de U.S. So that two are it trading. in will

have For to to or their change London shares the flexibility Hong Kong. they holding investors alias U.S.

in The and political So China. quite issues. pipeline drugs And have doing Mainland innovations. approved new and broad years. I HUTCHMED deep and don't good comment oncology know these drugs has the actually -- progress how to marketed has on new been been several over having And it of a

reviewed being now is EU. and U.S. outside the [Indiscernible] them, of One for market

in So XX HUTCHMED world. around at studies candidates the another moment has the drug clinical

expand So the R&D they will future and in continue global the market. to into in invest

on. operation So goes

Kin Ning Fok

This on actually And will market that -- is one a and the of want want ensuring to by I that more just where don't you point the in to add pharmacy is change CEO, England. [Indiscernible] -- I

Victor Li

succession a have already. plan We

Kin Ning Fok

was drugs. and has that XX selected scientist successful the the new developing for then just and years. achieved pipeline. responsible XX another company And the XX he want CEO in was Three with for to I that emphasize been successful,

next So the a logical it transition. to person CEO seamless will be and most he be continue will then

that is on market that just So to because wanted I the say --

Victor Li

of is That part the plant.

Operator

have is of you, lack impact you, the in This Kin question supplying as earnings? Do disruptions chain CKHH follow. Thank chairman. Ning. any Thank

Victor Li

positive longer. [Indiscernible] question. Maybe yard tend the is there containers in supplying I'll a impact. When disruptions, take to this are stay chain

it generate will So higher storage income.

are yard continue positive is our [Indiscernible], earnings. some supply easing high of disruption a and ' container likely the the density. Basically, containers contribute chain time [Indiscernible] XXXX, in half expect and -- congestions ports to the of but for yard to We second

Operator

sort you is The of any XXXX? [Indiscernible] as do yes, [Indiscernible]? outlook in Thank expect question do [Indiscernible] [Indiscernible] you, follows; expect? what container growth If the next Chairman. is what you of of And [Indiscernible]

Victor Li

Kenny, do you want to make that a projection, prediction?

Kin Ning Fok

to Well, must grow. we expect grow. know we division all They our

business this So be be should And expect that congestion will And volume the [Indiscernible]. less. [Indiscernible]. think in more then, come you then will a would that expect more I from it then I June will 'XX,

this is However, we storage the we there is And then have incomes. congestion and what still are expecting. still

Operator

year? Thank of What and Kin Ning. you much, there The spectrum the in CapEx outlook this be any on next option XXXX is question very EBITDA. [Indiscernible] is will

Victor Li

continue. telecom, you Ning, Kin

Kin Ning Fok

Okay.

the Australia increase option Ireland, be XXXX Which -- significant top that, less. So spectrum this been only And it looks Ireland. I it from the it's on will in be be in will happened in a will year. in and like CapEx of And that think, XXXX.

much So that on [Indiscernible] on cash CapEx be the side Because telecom less. will on XXXX, the

Operator

time Ning. take two more to the will maybe questions. we Kin Due Thank constraint, you

is, are [Indiscernible]? major respect sustainability, particularly focus with question this CKI what to So

Victor Li

We've answered that earlier. question

generators. as us First, for our [Indiscernible] we not problem and opportunity. look business we a it's generators of are distributors. A We're are not lot this at not and

enjoying other Netherlands, in to because we're invest be we is wind, we'll benefit But foreigners will I we're as And them. have looking waste at still which as movement alternatives that, already and us opportunities at this accommodating we solar, an look so energy. it connect there's in the the only in it. are in we government acquisition subject approval. to and And

a positive So I look it movement for at as us.

Operator

Thank you, Chairman.

Dominic Lai

Thank you.

Operator

This question today. our last is

IR Our answer the unanswered remaining -- next the in will questions department two days.

is; next how you environment current [Indiscernible] Our that view do consolidation? question

Victor Li

be this question? answering the person Chairman, you must

Kin Ning Fok

Okay.

final have be of me the that it in yet, player heart, come This that I think looks seems before. they see is it a and they a change may to they not U.K. number then like off as chain. not the critical

we this. So welcome

happen consolidation can because our that's is what So in strategy.

Thank So you. we welcome that.

Victor Li

on any can't we think go further that. than I

Operator

much for Thank you Ning. Chairman. for Thank Thank you, Hey, you coming you, thank today. our Thank very presentation. Kin you. joining

Victor Li

staring [Indiscernible] hope see screen. can Thank each year person. you. I is this this little at other we

Okay.

Kin Ning Fok

Bye, bye.

CK Hutchison Holdings Limited (CKHUY) 17 Mar 222021 Q3 Earnings call transcript