Jardine Matheson Holdings Limited

I'm Suzanne Turk, Head of Treasury and Investor Relations at Jardine Matheson. Welcome to the Jardine Matheson Holdings full year 2025 results presentation. For those joining us in the room here, you can download the presentation slides from our JM corporate website or at the QR code here. For those joining us online, you should now be able to see the live webcast and presentation slides. You may also submit questions via the Q&A function at the bottom of your screen at any time, and we will address them during the Q&A session. Now I would first like to introduce our speakers today. We have Lincoln Pan, Chief Executive Officer of Jardine Matheson Holdings, and Graham Baker, our Chief Financial Officer. As I'm sure many of you already know, Lincoln joined us on the 1st of December, 2025. Please join us in welcoming him for his first results presentation. Today, you will hear from him on his vision for Jardines, our commitment to shareholders and how we'll deliver, which we will go into greater detail on the 16th of June during our investor day in Hong Kong. Graham will then take you through the financial performance of the company and the portfolio. There will be a Q&A session at the end of the presentation, which I'm sure all of you are very much looking forward to. But for people in the room, I would kindly ask that you hold your questions until then. With that, let me now ask Inken to begin our presentation.

Okay. Well, thank you, Suzanne, and good morning to everyone here in Hong Kong and to those who have joined us online. I'm looking forward to an engaging session with all of you today. So thank you again to the many partners of Jardine Matheson, including some of you in this room who have welcomed me to this great organization. At Jardine Matheson, we have set a clear ambition for ourselves. We strive to be an outstanding investment vehicle focused on building diverse, high-quality businesses in Asia Pacific, delivering sustainable, top-quartile total shareholder returns. Two years ago, our executive chairman, Ben Keswick, initiated a transformation process to evolve Jardine Matheson from owner-operator to an investment company. Good progress have been made strengthening our portfolio leadership teams and boards of industry leaders, setting total shareholder return as our governing KPI, and aligning shareholder and management incentives and recycling capital. Today, our job is to accelerate the evolution of Jardine Matheson. and our role as an investment holding company, building an organization that's committed to active long-term value creation, talent development with aligned incentives, world-class governance, and continuous improvement in sustainability. Whilst we'll lay out more our strategy and financial objectives in greater detail in our investor day in the summer, today I would like to begin outlining the principles which Jardi Matheson will operate with to deliver for our shareholders. First and most importantly, we're targeting sustainable top quartile five-year TSR outperforming alternatives for investing in Asia. This will be supported by commitment to growing the dividend annually in value creation initiatives to drive portfolio performance. Our goal is to be a stable, diversified platform delivering GDP plus growth and growing cash on cash distributions across our markets. Secondly, we'll have an active program to recycle capital, exiting below hurdle assets with limited prospects and recycling capital toward businesses existing and new that improve our quality of earnings. Both our portfolio investments in Hong Kong land and DFI retail have done an excellent job of this in 2025. In 2025, Jardine Matheson and its portfolio companies recycled $4.8 billion of capital, more than the last four years combined. Thirdly, we'll principally be a control or lead investor in our portfolio companies. This is a change to our legacy historic strategy. Being a Jardine Matheson company must come with meaning and must come with principles. These include our ability to appoint, incentivize, develop and change management. operating with international standards of governance and a commitment to environmental objectives. From my experience in Asia, this is best done and almost only done as a control investor. And finally, we'll be a lean holding company where practically every resource at Jardine Matheson must be focused on enhancing value and managing risk in our portfolio and thoughtful capital recycling. This is also a meaningful change from our legacy strategy. 2025 was a strong year for Jardine Matheson and its portfolio companies. alongside the significant capital recycling below hurdle rate return investments at Hong Kong Land, DFI Retail, Mandarin Oriental and Jardine Cycle and Carriage, there was a $1.4 billion deleveraging of the JMH parent company balance sheet. The JMH parent company balance sheet finished the year in a net cash position, which provides us with flexibility for future investment opportunities. Five-year TSR at the year end was 8.8%, up markedly from negative 0.6% a year earlier. We continue to see significant value in our existing portfolio as well. And as a result, we launched a $250 million buyback program for the Jardine Matheson Holding level in November. We are also investing. There is a misperception that right now that Jardine's is a seller of everything. This is categorically not true. We invested $2.8 billion back into our companies in 2025 and will continue to reinvest in parts of our portfolio we believe in. Grant will go over the financials in a moment, but I would like to highlight our dividend per share has increased to $2.35, reflecting a progressive dividend policy which has delivered annualized growth of 6.4% over the last five years. Whilst we've made progress in 2025, we still see significant upside for JMH. Our portfolio companies are tightly focused on improving execution, and we are continuing to support this with accountability, the introduction of TSR-linked long-term incentive plans across our businesses, and investment in talent for new investments and portfolio value creation. You will see us continue to be more ambitious and active in assessing and recycling capital in our portfolio. We have clear return hurdles for new capital deployment and we will see opportunities to continue to simplify the group and improve shareholder value as we have done with Mandarin Oriental. We'll share more on our specific capital allocation hurdles and targets and principles later on in June. And we'll begin to work to grow Jardine Matheson's earnings in the future, focus on scalable businesses delivering and diversifying our Asia footprint. These activities are supported by a macro environment in Asia that has been generally improving and which favors permanent capital that can look beyond near-term volatility. I hope you can start to see that Jardi Matheson is a very different company today than in the past. I'll now turn to some of the year's highlights, starting with the privatization of Mandarin Oriental in January. This privatization enabled us to eliminate an inefficient listing structure whilst releasing significant capital for shareholders by selling part of One Causeway Bay, a non-core real estate asset. The privatization will allow our outstanding management team, led by Laurent Kleinman, to execute their ambitious growth agenda in a private setting. Importantly, it will also create options for Jardine Matheson to realize greater value from our Mandarin Oriental ownership in the future. The hotel management business is a really exciting business for us and expects to be bringing a growth driver for the group. Astra delivered robust earnings amid softer domestic conditions and a challenging capital market environment. Despite this, share price growth in the year supported five-year TSR of 9.8%. Aligned with our TSR strategy, Astra and United Tractors each completed a 2 trillion Indonesian rupiah or 121 million US dollar share buyback program in January. They announced a subsequent transfer share buybacks amounting to a trillion Indonesian rupiah each in the same month, which we're now in the process of completing. We expect these buyback programs to continue given the strong value we see in Astra. We're also working with Astra on talent management and incentive alignment, as we have done across our other parts of our portfolio. In the first half of 2026, we'll also announce enhancements to Astra's Board of Commissioners. Alongside this, executive succession efforts are ongoing. You'll hear more leadership announcements from Astra in the coming months. Looking forward, Astra will continue to focus on its core automotive, consumer finance, and heavy equipment and mining segments while investing in growth segments, for example, like healthcare and infrastructure. We remain committed to investing more in Indonesia and to supporting Astra's capital recycling efforts to drive future growth. I'm personally spending significant time in partnering with the Astra management team and down in Jakarta practically every month with our Astra leadership. 2025 was a productive year also for Hong Kong Land, as they took meaningful steps forward in delivering the early phases of their strategic vision 2035, which would transform the business into a more disciplined, capital-efficient, and growth-oriented company. The early phases of this transformation focus on capital recycling. Completed or announced net proceeds recycled at the end of February have totaled $3.6 billion since the strategy was announced in October 2024. A major milestone announced in February 2026 was the establishment of the Singapore Central Private Real Estate Fund, Hong Kong Land's first private real estate fund. The new fund has $6.4 billion of assets under management, with Qatar Investment Authority and APG Asset Management as founding investors. The fund represents a significant milestone in the execution of Hong Kong Land's strategy to build a scalable third-party capital platform, broadening Hong Kong Land's investor base and diversifying income through fee-based revenue. This is a good example of Jardine Matheson supporting our portfolio companies in enhancing quality of earnings and a portfolio company leadership executing new strategies at pace. Michael Smith and his team are bringing significant innovation and drive to this business. DFI Retail also made excellent strategic process during the year. This was led by decisive portfolio actions, including divestment of low-yielding minority sticks in Yonghui, Rasmussen Retails, and our Singapore food business. The proceeds from these divestments allowed DFI to pay a $600 million special dividend, with Jardine Matheson receiving $465 million. DFI have committed to a 70% dividend payout ratio and have announced a mid-term target of $310 to $350 million underlying profit by 2028. Scott Price and his team have brought execution and focus to DFI. They are laser focused on executing DFI's strategy and an outstanding team of retailers. Whilst we see value in our existing portfolio, we have and will continue to support share buybacks and share purchases at the JMH and the portfolio company level. These have been substantial over the last five years, with JMH investing $7.7 billion. At the year end, we had open buyback programs across JMH, Hong Kong Land, Astra, and United Tractors. As the company has announced, I am also an ongoing investor in Jardi Matheson, having personally invested about $10 million before and after I've started as CEO. This is a commitment I made to my principal shareholders, that a CEO must have personal alignment, independent of stock-based compensation. My intention will be to reinvest the majority of my short-term incentive compensation back into Jardine Matheson stock while I remain CEO of Jardine Matheson Holdings. Sustainability continues to be an important enabler of long-term value creation across Jardines and our portfolio. In 2025, we continue to make progress on carbon reduction in line with targets we are setting with our portfolio companies. At the portfolio company level, we're seeing tangible improvements in execution with businesses advancing emissions reduction initiatives while also strengthening operational resilience and cost efficiency. We're also seeing improvements across external ESG ratings which we view as an important validation of our approach as long-term owners and responsible stewards of capital. And now let me pass the presentation to Graham who will take us through the financials and more details. Thanks Lincoln.

Jardine Matheson delivered very solid performance in 2025. Our improved execution and heightened focus on shareholder returns at a time when investors have recognized again opportunities in Asia to diversify their holdings resulted in a strong recovery of our five-year TSR to 8.8% per annum, the highest level in over a decade. Underlying earnings per share improved by 9% to $5.72, supporting a full year dividend of $2.35 a share. You'll recall that in the prior year, we held our dividend despite a drop in underlying earnings. Reported earnings returned to net profit of $1.1 billion, rising by nearly $1.6 billion from the prior year loss. This substantial turnaround primarily reflects the fair value of investment properties, which rose in 2025 in Central after six years of revaluation losses. Parent cash flows were robust, and importantly, our parent balance sheet finished the year in a net cash position, providing investment flexibility. Starting with earnings, as shown on the left-hand chart, underlying net profit grew 11% in the year to nearly $1.7 billion. From 2025 onwards, we've updated our definition of underlying earnings to exclude entirely the results of Hong Kong Land's build to sell or BTS business. 2024 underlying net profit is therefore also represented in the chart. This change reflects Hong Kong lands announced exit from BTS and therefore I believe will help better understanding of the progress of our ongoing strategic businesses. As this is a change however, we've also included the chart on the right which shows underlying net profit under the prior definition. Three things to note here. Firstly, net profit in 2025 is the same on both definitions, as net all-in profit from build to sell was less than a million dollars in 2025. Secondly, that was not the case in 2024 when BTS at our level registered a net loss of $47 million. So if we'd stayed on the old definition, our headline underlying growth rate would actually have been 3% higher at 14% than the 11% we've announced today. And thirdly, our result in 2025 on the old definition was 2.6% above the guidance we gave for the year, which you'll recall was for flat earnings excluding the 2024 BTS impairments. So in summary, a very solid earnings performance in 2025, both in growing our ongoing businesses and against guidance. Looking at this now by business, Our two largest businesses, Astra and Hong Kong Land, both saw marginally lower contributions in 2025. However, this was more than compensated by growing contributions from DFI, JP and JC&C, once again demonstrating the value of our diversified portfolio. I'll cover the core portfolio companies in more detail in a moment. However, for now, JC&C saw an improved contribution from Vietnam and also benefited significantly from foreign exchange gains and lower financing costs at the corporate level. Our outside-in estimate of Zhongsheng's contribution is 23% below the prior year, linked to the bottom end of the range of analysts' estimates. following a disappointing result in the first half of the year and ongoing pressures on margins from oversupply in the mainland new car market. Finally, we benefited in 2025 from a significantly lower set of corporate charges, $67 million below the prior year due to higher investment income, lower financing costs, and lower corporate overheads. Outside underlying earnings, the group recorded a net non-trading loss of $572 million, well below the nearly $2 billion charge in 2024. As mentioned before, the main change was in the valuation of Hong Kong Land Central portfolio, which rose in 2025, the first increase since 2018, principally driven by the retail portfolio. Within impairments, the major item was against the carrying value of Zhongsheng, reflecting its deteriorating share price and challenging market outlook. On the group's balance sheet, net borrowings excluding for Astra's financial services companies fell by $4.6 billion to $2.7 billion and gearing fell from 14% to 5%. This was driven by debt reductions at almost all portfolio companies and at the JM parent company level. Financial services net debt moved marginally upwards in line with growth of the business's lending portfolio. Group cash flows from operating activities for the year were $5.3 billion, up 6%, with stronger cash generation at DFI, Astra, and Jardine Pacific. Investing activities generated a net inflow of $2.1 billion compared to an outflow in the prior year. Organic capital expenditure in our subsidiaries, together with investments in joint ventures, in total grew 17% to $2.8 billion. However, while we continued to grow our organic business investments, we also saw $4.8 billion of capital recycling from, among other things, the sales of Yong Kway, Robinson's Retail, and Singapore Food by DFI, nine floors of One Exchange Square, MCL Land, and MBFC Tower 3 in Singapore by Hong Kong Land, the top 13 floors of One Causeway Bay by Mandarin Oriental, part of its Vinamilk stake by JC&C, and other listed investments sold by JMH Perrin. Lower cash outflows from financing activities mainly reflect lower share purchases by Jardine Matheson of its subsidiaries, principally of JC&C and Mandarin. than in 2024, as we prioritized debt reduction in our holding structure for much of the year. The group has $15 billion of liquidity headroom to finance future growth. Overall, the group's portfolio companies continue to be highly cash generative, supported by strong balance sheets and access to considerable liquidity. Now turning to Jardine Matheson's corporate balance sheet and cash flows at the parent company level, Parent free cash flow rose 7% to $933 million, and cash cover for the Jardine Matheson dividend remained ample at two times. The parent company balance sheet, as mentioned, finished the year in a net cash position following net debt reduction of $1.4 billion during the year. the clean closing net cash position comprises 10 and 15 year bonds totaling $1.2 billion issued in 2021 at an effective interest rate of 2.6% and $1.2 billion of corporate cash held at leading high quality regional and global banks which together with further substantial committed facilities gives the group ample flexibility for new capital deployments. I'll now go through the performance of our core portfolio companies for details. Do refer directly to our company's respective results briefings. Looking first at Astra, unless otherwise stated, the numbers on this slide are all shown in local currency. And like all the other portfolio company slides, are on a 100% basis. Astra saw positive progress in its five-year TSR to 9.8% per annum. benefiting from a strong share price recovery in 2025. As Lincoln mentioned, Astra and United Tractors both launched buyback programs during the year aligned to TSR strategy. Net profit in local currency was marginally down at 32.8 trillion rupiah amid a softer domestic economy, with lower contributions from the coal and four-wheeler businesses as coal prices moderated and the auto market contracted, partly offset by improved performances in motorcycles, consumer financing, and non-coal mining. Astra's contribution to JM's underlying net profit also fell modestly with a weakening rupiah offset by an increase in JM's effective shareholding. Astra's net cash position remains strong, providing capacity to fund its strategic priorities. Astra is, of course, a core part of Jardines. We continue to have confidence in its long-term prospects and will continue to support its investments in driving value and growth in its core franchises. Hong Kong Land has also seen a major improvement in five-year TSR as it makes meaningful progress against its Vision 2035 strategy. At the end of February 2026, Hong Kong Land had recycled $3.6 billion of capital since the new strategy was announced, representing 90% of their announced 2027 target. Accordingly, net debt fell by $1.5 billion in 2025 to $3.6 billion. And Hong Kong Land, of course, made the same change as Jardines to exclude BTS from underlying earnings. Underlying net profit on this basis fell by 8%, principally due to lower average office rentals and the temporary impact of the landmark renovation on retail income in Hong Kong. However, recurring dividend income to JM increased 5% to $271 million, reflecting Hong Kong Land's commitment to grow dividends per share over time. Built to sell net profits reported as a non-trading item were, as mentioned earlier, negligible after further impairments were taken against the residential portfolio, mainly in China. However, good progress was made in recycling capital from completing BTS projects with inventory sales of $800 million in the year. DFI's five-year TSR also recovered strongly to 5.1% with a one-year TSR of over 90%. After paying a special dividend of $600 million to shareholders, DFI finished the year in a net cash position, providing it with capacity for continued investment in its stores, technology, and future strategic priorities. In total, JMH received $575 million of dividends from DFI in 2025. Mandarin Oriental's five-year TSR was 13.5%, supported, of course, by the privatization, Mandarin finished the year with $856 million net cash, following the disposal of the top floors of One Causeway Bay. Part of this, after meeting CapEx needs, was used to pay a special dividend of $758 million to shareholders, including Jardine's, in January 2026. And part of our share was in turn used to fund the privatization. underlying net profit rose 8% to $68 million, with higher contributions from the Hong Kong and Tokyo properties. Jardine Pacific reported higher underlying net profit of $191 million, up 28%. Its engineering and infrastructure businesses reported a 10% increase in underlying net profit, while the consumer businesses reported as part of others returned to profit. We're actively making people investments to strengthen engineering and infrastructure and looking to recycle capital into this segment to expand and grow. We're excited about the prospects of Gammon Construction in Hong Kong and of JEC regionally and actively investing behind these management teams. And Jardine Pacific continues, of course, to provide a valuable flow of recurring dividends to the JM parent. Finally, looking ahead to 2026, I'd like to note that as a result of the tremendous work in 2025 on capital recycling and simplification activities, our underlying earnings will exclude a number of items that contributed in 2025. Principally, these are the disposals at DFI and of our Vinamilk shares. Additionally, we will shift in 2026 to accounting for Zhongsheng as an investment rather than an associate. so that only dividends rather than a share of earnings from Zhongsheng will be recorded in our underlying earnings. After adjusting for these changes, our pro forma 2025 underlying EPS exit rate base for your 2026 estimates is 39 cents lower at $5.33. And with that, I'll hand back to Lincoln. Thank you, Graham.