Annual Report 2020

96 Transport International Holdings Limited 2020 Annual Report Financial Review Total operating expenses for 2020 amounted to HK$7,193.5 million, a decrease of HK$619.8 million or 7.9% compared to HK$7,813.3 million for 2019. The decrease was mainly due to the decrease in fuel costs, staff costs and toll related expenses as a result of service reductions as well as the decrease in other overheads through implementing various cost control measures to streamline its business. The Group’s share of profits of associates for 2020 amounted to HK$6.5 million, a decrease of HK$15.0 million or 69.8% compared to HK$21.5 million for 2019. Income tax credit for the year amounted to HK$182.0 million (2019: income tax expense of HK$94.0 million). The breakdown of the income tax credit/expense is set out in note 6 to the financial statements on page 190 of this Annual Report. More detailed information in respect of the Group’s individual business units is set out on pages 101 to 106 of this Annual Report. Dividend The Board has recommended an ordinary final dividend of HK$0.50 per share (2019: HK$0.70 per share). Subject to the approval of the shareholders at the Annual General Meeting of the Company to be held on 20 May 2021 or at any adjournment thereof, the total dividend for the year will be HK$0.50 per share (2019: HK$1.00 per share). The Company’s intention is to maintain stable returns to shareholders. Key Changes to Financial Position Capital Expenditure As at 31 December 2020, the Group’s investment properties, investment property under development, interest in leasehold land and other property, plant and equipment (comprising buildings, buses and other motor vehicles, buses under construction, tools and others) amounted to HK$10,953.6 million (2019: HK$10,154.4 million). The increase was mainly due to the development of Kwun Tong Site and purchase of new buses by KMB and LWB for fleet replacement during the year. None of the assets was pledged or charged as at 31 December 2020. The breakdown of the capital expenditure is shown in note 13 to the financial statements on pages 198 to 203 of this Annual Report. Intangible Assets and Goodwill As at 31 December 2020, the Group’s intangible assets and goodwill amounted to HK$365.0 million (2019: HK$365.0 million) and HK$84.1 million (2019: HK$84.1 million) respectively. The intangible assets mainly represent passenger service licences and transport operating rights of the Group’s non-franchised transport operations. Capital Expenditure 2020 HK$270 million (15%) HK$13 million (1%) HK$474 million (26%) HK$1,038 million (58%) 2019 HK$281 million (22%) HK$231 million (18%) HK$21 million (2%) HK$742 million (58%) 2020 2019 Investment property under development Buses and other motor vehicles Buildings Others