Interim Report 2023

15 INTERIM REPORT 2023 Note 2 Net interest-bearing debts and lease liabilities divided by total equity. The financial statements of the Group’s foreign investments are in Renminbi, Euro, United States dollar, Brazilian Real or other currencies and any exchange difference so arising from retranslation of these financial statements was recognised in the reserve of the Group. The Group has developed a sound foreign exchange rate risk management mechanism to prevent the impact arising from foreign exchange rate fluctuation on the Group, and thus maintaining foreign exchange risk at a manageable level. In general, the Group’s ports operation continued to yield stable cash inflow. For the six months ended 30 June 2023, the Group’s net cash inflow from operating activities amounted to HK$2,397 million, a decrease of 37.5% as compared with the corresponding period last year, among which, the receipt of cash dividends from associates and joint ventures were HK$551 million, a decrease of 23.0% as compared with the corresponding period last year. Due to the decrease in capital expenditure on business acquisitions as compared to the same period last year, the Group’s net cash outflow from investing activities decreased from HK$1,952 million for the same period last year to HK$1,053 million for the current period. At the same time, the Group’s net outflow of proceeds from new borrowings and repayments of borrowings decreased as compared with that for the same period last year. The Group’s net cash outflow from financing activities decreased from HK$2,717 million for the same period last year to HK$2,266 million for the current period. LIQUIDITY AND TREASURY POLICIES As at 30 June 2023, the Group had approximately HK$8,430 million in cash and bank balances, 2.3% of which was denominated in Hong Kong dollar, 28.5% in United States dollar, 57.8% in Renminbi, 8.7% in Euro, 2.3% in Brazilian Real and 0.4% in other currencies. The Group mainly derived its funding sources from its operating activities related to ports operation, bonded logistics operation and property investment, and investment returns received from associates and joint ventures, which amounted to HK$2,397 million in total. During the period, the Group incurred capital expenditure amounting to HK$447 million, while the Group adopted a prudent financial policy and maintained a sound financial position. In addition, as a significant portion of the Group’s bank loans were medium-term to long-term loans, the Group, supported by adequate undrawn bilateral bank facilities of HK$15,912 million, does not anticipate any difficulty in refinancing its short-term loans while the pressure for repaying the short-term loans is limited. SHARE CAPITAL AND FINANCIAL RESOURCES As at 30 June 2023, the Company had 4,003,383,046 shares in issue. In July 2023, the Company issued 127,597,960 shares under the Company’s scrip dividend scheme. As at 30 June 2023, the Group’s net gearing ratio Note 2 was approximately 20.7%. The Group had aggregate bank loans, notes payable and perpetual capital securities of HK$22,668 million as at 30 June 2023 that contain customary cross default provisions.