MTR Corporation Limited

HIGHLIGHTS
Hong Kong Businesses
- Our recurrent businesses benefited from continuing recovery in Domestic patronage, the resumption of Cross-boundary and High Speed Rail services and the related Duty Free businesses. Recovery was especially strong in High Speed Rail
- Train service delivery and passenger journeys on-time for heavy rail achieved more than 99.9%world-class level
- Fare Adjustment Mechanism review concluded in March 2023, providing a stable source of recurrent revenue for our railway assets maintenance, renewal and upgrade while maintaining the Company's financial sustainability
- Initial booking on the fair value measurement gain of THE SOUTHSIDE shopping mall
- Our new shopping malls, The Wai in Tai Wai and the first phase of THE SOUTHSIDE in Wong Chuk Hang, opened in July 2023 and December 2023 respectively
- Entered into project agreements with the Government for Tung Chung Line Extension, Tuen Mun South Extension and Kwu Tung Station
Mainland of China and International Businesses
- Concessions of the South Western Railway in the United Kingdom and Melbourne's metropolitan train service in Australia extended to May 2025 and mid-2026 respectively
- Remaining section of Beijing Metro Line 16 and Northern Section of Beijing Metro Line 17 opened in December 2023
- Due to on-going driver shortages and maintenance issues, which had inevitable impacts on the financial performance, the Group entered into supplementary agreements to early terminate our concessions for both Stockholms pendeltåg and Mälartåg effective 2 March 2024 and 16 June 2024 respectively, and loss provisions, totalling HK$1.0 billion, in respect of those onerous contracts were charged to the Group's 2023 profit or loss
Outlook
- The Corporation continues to navigate a volatile global economic environment fraught with issues such as geopolitical dynamics, inflationary pressures and high interest rates, while maintaining prudent cost management and seeking out smart technologies and innovations to counter these and other challenges
- Subject to the construction and sales progress, we expect to book property development profit from La Montagne (THE SOUTHSIDE Package 4), THE SOUTHSIDE Package 5, Ho Man Tin Station Package 1 and IN ONE (Ho Man Tin Station Package 2), and to continue to book profit from Villa Garda (LOHAS Park Package 11)
- Closely monitor market conditions and review our programme for tendering of property development projects as appropriate. In the next 12 months or so, we expect to re-tender Tung Chung East Station Package 1
- Continue to progress various new railway projects under RDS 2014 and assist on initiatives planned under Hong Kong Major Transport Infrastructure Development Blueprint

The Directors of the Company announce the audited results of the Company and its subsidiaries (the "Group") for the year ended 31 December 2023 as follows:

CONSOLIDATED STATEMENT OF PROFIT OR LOSS

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Notes:

1. AUDITOR'S REPORT

The consolidated financial statements for the year ended 31 December 2023 have been audited in accordance with Hong Kong Standards on Auditing, issued by the Hong Kong Institute of Certified Public Accountants ("HKICPA"), by the Company's auditor, KPMG. Unmodified auditor's report of KPMG is included in the annual report to be sent to shareholders. The consolidated financial statements have also been reviewed by the Company's Audit & Risk Committee.

The financial figures in respect of the Group's consolidated statement of profit or loss, consolidated statement of comprehensive income, consolidated statement of financial position and the related notes thereto for the year ended 31 December 2023, as set out in this preliminary announcement, have been compared by KPMG to the amounts set out in the Group's audited consolidated financial statements for the year and the amounts were found to be in agreement. The work performed by KPMG in this respect did not constitute an audit, review or other assurance engagement in accordance with Hong Kong Standards on Auditing, Hong Kong Standards on Review Engagements or Hong Kong Standards on Assurance Engagements issued by the HKICPA and consequently no assurance has been expressed by KPMG on this announcement.

2. BASIS OF PREPARATION

This preliminary announcement of the Company's annual results has been prepared in accordance with the applicable disclosure provisions of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

The financial information relating to the financial years ended 31 December 2023 and 2022 included in this preliminary announcement of the annual results does not constitute the Company's statutory annual consolidated financial statements for those years but is derived from those financial statements. Further information relating to these statutory financial statements required to be disclosed in accordance with section 436 of the Hong Kong Companies Ordinance (Cap. 622) is as follows:

• The Company has delivered the financial statements for the year ended 31 December 2022 to the Registrar of Companies in accordance with section 662(3) of, and Part 3 of Schedule 6 to, the Companies Ordinance and will deliver the financial statements for the year ended 31 December 2023 in due course.
• The Company's auditor has reported on those consolidated financial statements of the Group for both years. The auditor's reports were unqualified; did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying its reports; and did not contain a statement under sections 406(2), 407(2) or (3) of the Companies Ordinance.

The consolidated financial statements have been prepared in accordance with all applicable Hong Kong Financial Reporting Standards ("HKFRSs") issued by the HKICPA.

The HKICPA has issued a new HKFRS and a number of amendments to HKFRSs that are first effective for the current accounting period of the Group. The impacts of adopting certain amended HKFRSs that are relevant to the Group are discussed below. None of the developments have had a material effect on the Group's results and financial position for the current or prior periods. The Group has not applied any new standard or interpretation that is not yet effective for the current accounting period.

For more information, please visit https://doc.irasia.com/listco/hk/mtr/annual/2023/respress.pdf.

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