MTR Corporation Limited (66) Earnings Call Transcript & Summary

Ladies and gentlemen and proxies, welcome to the 2020 Annual General Meeting of the MTR Corporation Limited. I would also like to welcome those watching our meeting through online webcast. As the number of shareholders who can physically attend our meeting is limited, the company has, therefore, made available live online webcast. However, please note that shareholders watching the live online webcast will not be counted towards a quorum nor be able to cast the votes online. Before the meeting begins, I would like to draw your attention to a few points. We understand that the AGM is an important occasion for our shareholders to ask questions of the Board. However, in the midst of the COVID-19 outbreak and in order to comply with the government's regulations on group gatherings and maintaining social distancing, we have made every effort to accommodate as many of you as circumstances permit and provide shareholders with the opportunity to ask questions and to vote, while at the same time being mindful of the need to protect your health and safety, as you have all undergone a body temperature check and completed the health declaration form before coming into the venue. There will be -- there are also a few other measures I'd like to remind you of. First of all, you're kindly reminded to wear a mask before -- throughout the meeting. In the environmental bag distributed to you earlier, there is an alcohol wet tissue for you to clean the voting asset and the earphone. There's also hand sanitizers available inside the hall for your use. Secondly, please remain in your assigned seats throughout the meeting to ensure social distancing and to enable contact tracing, if necessary. Please do not change your seats and be mindful of personal hygiene. Third, as mentioned in the circular of this AGM, there will be no distribution of refreshment packs or provision of coffee or tea at the meeting. However, there are water dispensers, providing hot and cold water outside this hall. The money saved by not purchasing refreshment packs will be donated by the company to the Hong Chi Association. In a minute, the Chairman will be delivering his statement in Cantonese, and the meeting will mainly be conducted in Cantonese. There will be simultaneous translation into Putonghua and English throughout the meeting. If you require an interpretation earphone, please collect one from the earphone counter at the entrance to this hall. The company is committed to making available meeting facilities to enable all eligible shareholders to be able to participate in the meeting. As such, simultaneous sign language interpretation will also be provided at this meeting. As mentioned in the company's announcement on May 11, 2020, shareholders are required to submit their questions in writing to us by noon yesterday. After the Chairman has delivered a statement, we would endeavor to answer as many relevant questions as possible within the allocated time of about 15 minutes. To facilitate those shareholders who cannot come today or watch the online live webcast, the meeting will also be video recorded, and the webcast will be available on our website within 24 hours. In case of the emergency of evacuation, please leave the hall by following the fire evacuation safety instructions, which can be found inside the environmental bag, and for assistance, please approach our staff who are wearing a purple work pass. After the close of the meeting, please return the electronic voting handset, the smart card and the earphone to the designated place as directed by helpers. At this time, please switch off your cell phone or turn it into a silent mode. And with that, I have pleasure of passing the floor to our Chairman.

Good morning, shareholders, ladies and gentlemen, welcome to MTR Corporation Limited's 2020 Annual General Meeting. I am honored to Chair today's meeting for the first time as Chairman of the corporation. Due to the outbreak of COVID-19, our limited number of shareholders -- only limited number of shareholders can attend our meeting today, and the meeting will also be streamlined. At today's meeting, apart from reviewing the corporation's financial and business performance over the past year, I will also share with you certain matters of the corporation, which you are interested to know, including our business outlook and the various relief measures, which we have offered to our community and tenants in the current environment. Today, I have invited the representatives from KPMG and Stott & May, the corporation's external auditors and legal advisers, respectively, as well as other relevant persons to attend our meeting. As we already have a quorum present, I declare the meeting open. I believe you would have received a notice of this meeting. So with your permission, I propose that the notice be taken as read. Before we deal with the resolutions, I'd like to take this opportunity to thank Dr. Allan Wong, who will retire from the Board after the conclusion of this meeting for his contributions over the past years. In respect of the succession planning of the corporation's Board of Directors, there will be a resolution relating to the proposed election of a new Board member in the proceedings later in our meeting. Let me, first of all, share with you the MTR's business performance over the last year. The corporation has been rooted in Hong Kong for over 40 years. And 2019 is deemed to be the most difficult year in our 40 years of service. You would have remembered that the public order events, which happened last year have brought unprecedented challenges to the corporation. In respect of our financial performance, apart from the provisions made in the first half of 2019 in relation to the Shatin to Central Link Project, and the South Western Railway franchise in the U.K., our profitability was also adversely affected by the public order events in the second half of the year. Profit attributable to equity shareholders from recurring businesses was down by 44.8%. Having included the profit of the year from property development businesses, profit attributable to shareholders from underlying businesses decreased by 6.2%. After taking into account the corporation's rail and property businesses as a whole, the Board is of the view that the overall financial position of the group remains sound. Therefore, there will be a resolution to seek your approval on the declaration of the 2019 final ordinary dividend of HKD 0.98 per share. And now let me share with you the significant events relating to MTR, which may have drawn the attention of the public. As part of the whole Shatin to Central Link Project, the Tuen Ma Line Phase 1 was opened on February 14 this year. It is anticipated that the Tuen Ma -- the full Tuen Ma Line will be opened in 2021. As for the Hung Hom-Admiralty Section, the targeted completion in the first quarter of 2022 is still facing challenges, and there are continuing efforts being made with the aim of meeting the program. In respect of the submission of the final report on the quality of work at and near the Hung Hom Station extension of the Shatin to Central Link by the Commission of Inquiry to the government in March 2020, government has also published that report on May 12 this year. The Commission of Inquiry confirmed in its final report that the relevant structures at and near the Hung Hom Station extension are safe and fit-for-purpose with the completion of the suitable measures. Before that, the corporation had submitted to the government 2 separate final reports in respect of the quality of work at and near the Hung Hom Station extension in July last year, and had adopted a number of recommendations regarding the corporation's project management performance and systems made in the Commission of Inquiry's interim report. The corporation has already implemented some of those recommendations. The corporation is seriously reviewing the recommendations made by the commission in the report and will implement necessary follow-up actions, address our shortcomings, and will continue to strengthen our project management and quality assurance work. In respect of the cost to complete of the Shatin to Central Line (sic) [ Link ] project, the company carried out a further review and revalidation of the cost to complete and submitted to the government for review in February 2020. The corporation will continue to work closely with the government to achieve the delivery of the Shatin to Central Link project by endeavoring to complete the remaining works so as to let Hong Kong people enjoy the new railway services. Government had made a submission to the legislative council for the approval of additional funding for the Shatin to Central Link project. The public works subcommittee has already approved the funding application. And thereafter, it will be passed on to the finance committee for approval. The corporation understands the public's expectation for safe and reliable railway services, and the concern over the 2 incidents which happened last year in relation to the train collision on Tuen Ma Line during the nontraffic hours as a result of the testing of the new signaling system, and derailment near Hung Hom Station on the East Rail Line. In the wake of these 2 incidents, the company has already accepted the recommendations made by the relevant investigation panels and has proactively implemented improvement measures to prevent an -- the occurrence of similar incidents. During the second half of last year, during those public order events, our trains and stations were damaged to various degrees and normal railway operations were disrupted. And this has affected the ability of the public to travel in Hong Kong. Customers, staff and railway system safety have always been our top priority. During the affected period, we had, therefore, adjusted our rail services with a view to continuing to serve all Hong Kong people in a safe manner. I will now briefly share with you our performance in our various businesses in 2019. The MTR team has been dedicated to serving our customers and has achieved positive results in different business areas, including in Hong Kong, the opening of the Tuen Ma Line Phase 1, which I mentioned earlier, and this has brought more convenience to the public. On the property business front, the new property development projects awarded in 2019, including LOHAS Park Package 11 and the Wong Chuk Hang Station Package 4 together with the property project, which was awarded in February 2020, namely LOHAS Park Package 12 will offer around 4,650 residential units in total. In respect of our Hong Kong station commercial businesses, the total revenue in 2019 increased by 5.3% as compared with 2018, mainly attributable to the contribution from the high-speed rail, Hong Kong section in new retail -- station retail rental revenue for the full year of 2019. Last year, we achieved encouraging results outside of Hong Kong, which included the commencement of service on the Sydney Metro Northwest line, the initial section of the Hangzhou Metro line 5 as well as the Macao Light Rapid Transit type of line. At the end of April 2020, the full line of Hangzhou Metro Line 5 has been open for service. In Beijing, our associate was awarded the Beijing Metro Line 17 operations and maintenance concession. While in Australia, the existing Northwest Rapid Transit Consortium, of which we are a leading member, concluded the contract with the state government. MTR will take lead in the Sydney Metro City and Southwest Line project works, and railway operations and maintenance of the combined metro Northwest Line in City and Southwest Line. The business developments, which I just mentioned, will enable MTR to continue to progress as a world-class rail operation and management company. Business outlook. Following a series of public order events in the second half of 2019 and the COVID-19 epidemic in 2020, which brought about another unprecedented challenge to Hong Kong and MTR, the COVID-19 has become a global health issue. And the group's Hong Kong transport operations, Hong Kong station commercial businesses and property rental businesses have been seriously affected, including notable lower patronage, resulting in lower revenue, rental reduction relief granted to tenants and lower advertising revenue. Due to a dampened economic and operating environment in Hong Kong, it is expected that the appraised value of the corporation's investment properties will also be affected. Going forward, we still need to contend with a variety of risks and uncertainties, including the global economic slowdown, higher unemployment rates, reduced tourist arrivals and so on. All of these factors have caused tremendous pressure on our group's financials. It is expected that such negative impact will persist for some time. The group will keep the situation under review and implement cost control measures to help mitigate the negative financial impact that may result. Despite facing severe challenges, we believe the railway will continue to be the backbone of our public transport. In the years to come, we will work on the railway project works under government's Railway Development Strategy 2014. In April this year, the corporation was invited by the government to proceed with the detailed planning and design of the Tung Chung Line extension project. Construction is expected to commence in 2023. The expertise and experience we have gained in Hong Kong have been used on a growing portfolio of railway-related businesses in the mainland of China, Macao, Europe and Australia. Our railway businesses outside Hong Kong carried an average of about 7.2 million passengers per weekday in the year 2019. Turning now to the outlook of our property businesses. The corporation will deliver about 22,000 residential units from 16 property projects to the market in Hong Kong over the next 6 years. For the Siu Ho Wan Depot site, which will be developed into a community comprising both public and private housing, negotiation with the government is still ongoing. The Board places great emphasis on environmental, social and governance matters. We have taken and will continue to implement measures to protect our environment as well as contributing to our community, including the reduction of our carbon footprint, and providing fare and rental concessions. In response to the impact of the COVID-19 outbreak on the overall society in Hong Kong, the company has launched a series of fare concessions, resulting in the actual fare being paid by all passengers remaining unchanged throughout 2020. These series of concessions are worth over HKD 800 million in total, including the over HKD 700 million worth fare concession packages in 2020/'21 and the extension of the 3.3% rebate on every Octopus trip to the end of June 2020. Even though the operating environment remains challenging, the corporation has been offering over HKD 2.6 billion worth of ongoing fare concessions every year to customers of different walks of life, including the elderly children, eligible students and persons with disabilities. And this reflects MTR's care towards the different sectors of our community. Moreover, additional relief measures were announced in April this year, including the 20% rebate for every Octopus strip to be implemented for 6 months from July 1, 2020, to January 1, 2021, and a flat reduction of $100 off on each purchase of monthly pass Extras and MTR City Saver for all passengers during the 6 months from July 2020 to December 2020. The total amount of additional relief measures amounted to around HKD 1.6 billion. The government will bear half of the total revenue foregone, up to a cap of HKD 0.8 billion, while the corporation will shoulder the rest. In addition, the corporation has offered tenants at MTR stations and our shopping malls, a reduction of rent and donated 100,000 surgical masks to members of the communities through the Hong Kong Council of Social Service. Moreover, members of the corporation's Board and executive directors have also donated part of their remuneration to support those in need to help them ride out tough time amidst the pandemic. Since taking up the chairmanship in July last year, I have witnessed the solidarity and hard work of our MTR team. I would like to thank our more than 47,000 MTR staff in Hong Kong, the Mainland and overseas for their dedication and contribution, especially the perseverance and professionalism in the face of the severe challenges posed by COVID-19 and other public order events. I'd like to thank them all. We would also like to express our greatest attitude (sic) [ gratitude ] to the dedicate -- to our dedicated shareholders for the long-term support. And last but not the least, I would like to take this opportunity to thank our Board members and the management for their support to myself. I wish you all good health and a happy life. Thank you.

Thank you, Chairman, for that detailed report. We will now move on to the Q&A session.

Before we deal with the resolutions, we will take about 15 minutes to answer some of the questions which we have received from shareholders. We will actually combine some of the similar questions. Chairman, the first question comes from [ Mr. Wong ]. The question is that during these public order events, many of the facilities of MTR has been damaged. And this has actually affected the ability of the corporation to provide service to the public. So will the company seek compensation for damages?

Now first of all, I'd like to mention that for the MTR, safety is our top priority. As for our other services, if we think that safety is compromised, we will need to rethink. But as for details, I would like to ask our CEO, Dr. Kam, to answer that question.

I think we all know that our mission is to provide safe, reliable and expedient service for our passengers. And safety has always been our top priority. When we have emergency incidents, we have to temporarily suspend our service, but we will always do our best -- try our best to resume service. Of course, we don't want to see our facilities or trains and stations being vandalized. We don't want to see our colleagues injured. The damages to any of these facilities will affect our train services. In other words, the service for the public will also be disrupted. And therefore, we certainly don't want to see that happening. In fact, any illegal acts committed within the confine of our premises, we will report to the police. When the court has made -- whatever decision the court or ruling the court make, we will respect those rulings.

Thank you, Chairman and Dr. Kam. The next question comes from [ Mr. Lee ]. He said that he has earlier on written many times to our Chairman, expressing his opinion regarding the operational arrangements and the service of our MTR staff during the public order events and he would like the Chairman to respond.

I'd like to thank the shareholder for the question. As I said earlier, the MTR attaches a lot of importance to passenger service and safety. Shareholders have reflected to us the concern about our operational arrangements and the attitude of our staff during the public order events. I understand that our colleagues are now following up on those inquiries and comments. Perhaps Dr. Kam can also further elaborate.

Thank you. I think we all know that serving our customers is our mission and providing safe, reliable and expedient services is also our mission. When passengers use our service and if they require any assistance, our colleagues will do their best to help. As the Chairman said, our passenger -- safety for our passengers and colleagues would -- has always been a top priority. In the event of emergencies or events or incidents which may jeopardize the safety of our passengers and staff or damages our facilities, we have a duty to adopt appropriate measures, including fine tuning or even suspending our train service or even closing our train stations all for the purpose of ensuring safety. And we are grateful to our shareholders for such views. One shareholder has actually raised the same point to us many times. We will always do our level best to provide quality service for our passengers. If there's a need to temporarily suspend the service, we'll always try our best to resume service ASAP.

The next question comes from Mr. [ Yu ] regarding the dividend payout policy, will it be affected by the [ social outdoor events ] and COVID-19 as well as the changing economic environment?

Well, thank you for that question. I believe all shareholders would understand that any dividend payout policy it depends on several factors. First of all, the performance of the company; secondly, the need for capital expenditure; and thirdly, our financial position and other factors. Having considered all those factors, I think this year, hopefully, we're -- pending shareholders' approval, we will be approving a dividend of $1.23. But so far, the Board still plans to maintain that policy.

This is a question in English from [ Mr. Chen. ]

It's rather long. So a director's report for a financial year must contain a business review that consists of: a, a fair review of the company's business and the legal litigations went through since last year; b, a description of principal risks and uncertainties currently faced by the company; c, particulars of important events affecting the company up-to-date; d, what is the indication of likely future development in the company; and e, response to the current social unrest, including any public demands and substantial economic impact. And what has been done in pursuant of remedies as a follow-up? Did the Board disclose all these in the annual report? That's the question.

Well, thank you very much for the question from the shareholder. The shareholders may refer to Page 146 of the company's 2019 annual report, under the section Report of the Members of the Board with a summary of the relevant sections covering the required disclosures under the company ordinance is appended. In relation to the handling of the public order event and financial implications, though it is not a requirement to be disclosed in the director's report under the company's ordinance, we have provided a glimpse of the effects of the public order events on the company's Hong Kong businesses and actions taken in the Chairman's letter and the CEO's review of operations and outlook in the company's 2019 annual report. The corporation had also issued various press statements and an announcement in 2019 to keep the public and market informed. So I hope this is some information in answering to the question from the shareholder.

[Interpreted] The next question comes from a shareholder, [ Mr. Cole ]. The question is in respect of the nomination of the new director, MTRC is nominating Dr. Chan Chung-bun as a new director, saying that Dr. Chan has more than 30 years of experience in the garment industry and has taken up many public duties. How can Dr. Chan's experience help contribute to the business of the MTR?

[Interpreted] All along, members of the Board have always come from different business and professional background. The Board has always provide -- contributed a valuable experience and helping to safeguard and enhance the best interests of the company and the shareholders. To ensure that the Board has the right balance of expertise, skills and so on, every year, we will review the structure and the composition of the Board. I believe Dr. Chan's extensive experience and his active participation in social service, including youth development, social welfare, and his work at the district council, I'm sure that his joining the Board will contribute to the business of the company.

[Interpreted] The next question again comes from the same, [ Mr. Cole ]. Some shareholders would like to thank the MTR frontline staff who in the -- in 2019, especially in the second half for the dedication in serving the public. The question is that how many incidents resulting in more than 31 minutes of delay have been caused by factors which were within and beyond the control of the MTRC? And why is it that in the 2019 annual report, you left out the journey on time -- the delay caused by factors beyond the MTR's control affecting the journey on time?

[Interpreted] Mr. Lau will answer the question.

The MTR attaches a lot of importance to every incident of train delay. We will conduct an investigation each and every time. We will follow-up and improve in order to further improve our service. Based on the performance [ in pledge ] arrangement, for any delay exceeding 31 minutes due to factors within the control of the corporation, we will allocate funds to -- which will go to fare concessions benefiting the passengers. All along, we would provide full such details to the public. We will also make such disclosure in the annual report. As for the question regarding delay caused by factors beyond our control, I think he is referring to the fact that even though our railway system is sound, but sometimes there are inevitable factors beyond our control, for example, in the event of a typhoon, when you have debris flowing on to our tracks, and for safety reasons, we may have to suspend the service and, therefore, causing delay. On the light rail system, when there is -- there are traffic incidents on the road that's affecting cables, overhead cables, then for safety considerations, we may also need to suspend service, that's causing delay.

[Interpreted] Thank you, Mr. Lau. The next question has to do with our works. And this question comes from a shareholder, [ Mr. Yip ]. There have been delay in many of the MTR projects so that many new stations are not able to open on time. When will you be able to catch up the lost time?

[Interpreted] Well, thank you. Before I invite our operations director answer that question, I would like to mention that during this period, MTR has learned from our shortcomings. We've already improved a lot on our operations. I would like to ask Mr. Bayliss to further elaborate.

I believe the shareholders' question relates to progress on the Shatin to Central Line project. As we all are aware, the final report of the Commission of Inquiry, which was recently released by the government, has concluded that the relevant structures at and adjacent to the Hung Hom Station are safe and fit-for-purpose with the completion of the suitable measures. So as we progress towards the completion of those suitable measures, that will then allow us to focus on doing the rest of the work, including all the signaling, testing and commissioning such that we can bring the line into service, into passenger service, connecting the Tuen Ma Line Phase I and West Rail via new stations at Sung Wong Toi, To Kwa Wan and interchange stations at Ho Man Tin and Hung Hom, and the opening is planned for next year. As for the extension of the East Rail from Hung Hom across the harbor to Admiralty station, the target opening for this, as the Chairman has already said, is Q1 of 2022. Now that's a challenging target, but the project team are fully committed and working really hard to achieve that target. We are very focused on delivering the Shatin-Central Line project as soon as we possibly can so that passengers and the public of Hong Kong can enjoy the railway services.

[Interpreted] Thank you very much, Roger. We now come to the final question for today, and this is from [ Mr. Yip ]. This is a question regarding property development. The question is that what will be the property for sale in the first half of this year? Will they be small- to medium-sized flats?

[Interpreted] I'd like to call up our Property Director, Mr. Tang to answer the question.

[Interpreted] Thank you, Chairman. In 2020, I think earlier, we launched Package 9 of LOHAS Park. The remaining units will also be sold later this year. The Sea II/Sky has also -- we've also obtained consent for presale. We are now talking to our developer and discussing when we will launch it for sale. For the Tai Wai station project and LOHAS Park Package 10, we are also applying for consent for presale. We will have details later on. For these property projects, there will be many small- to medium-sized units.

[Interpreted] Thank you, Mr. Tang. I think we have now dealt with all the questions. And I will now defer back to the Chairman to deal with the resolutions.

[Interpreted] Once again, I'd like to thank all the shareholders who have put the questions to us earlier. We would always like -- tried our best to answer the questions from shareholders. But because of the epidemic, we're not able to answer as many questions as we would like. With that, we will now formally move on to the agenda proper. Before we go to the -- deal with the resolution, pursuant to Section 71 of the Articles of Association, I exercise my power as Chairman to demand that all the resolutions, they will be decided by poll, and pursuant to Section 72 of the Articles of Association, Chairman can decide on where, how and when the poll should take place. Pursuant to the Section 72, I exercise my power as Chairman and decide that we should use electronic voting system to vote on each and every resolution in order to save time. As before, I appoint Computershare Investor Services Limited as the scrutineer for the meeting. They will verify the votes today. Since we will be adopting a electronic voting device, the results will be shown on the screen. We expect that before the end of the meeting, we will have all -- the full results for the poll. Pursuant to the listing rules, the poll results will be announced on the website of the company and that of the stock exchange. And now I'd like to invite Ms. Phyllis Lee, the representative of the scrutineers to demonstrate how electronic poll voting will work.

[Interpreted] Thank you, Chairman. As mentioned by the Chairman, the poll on each of the resolutions proposed today will be conducted by an electronic voting system. Before explaining the electronic voting system, I would like to check that each of you who is a shareholder, a proxy or representative of a corporate shareholder has a handset and a smart card. If not, please raise your hand for assistance. Please ensure that your smart card has been inserted into your handset. If it is done properly, your English name should appear on the screen of that handset. During the meeting, the screen of the handset may turn into sleeping mode and blackout. To reactivate the handset again, you may press the track bar in the middle of the handset. If you need any assistance, please raise your hand. We will now use a dummy resolution to demonstrate how electronic voting for the poll will work. When I invite you to vote, I will say, please vote. At this point, you should press 1 to vote for or press 2 to vote against. Your choice should appear on the screen of your handset. If you wish to abstain from voting, please do not press any button. To ensure that the vote will be counted, please press the correct button after I have said, please vote. You may vote or change your vote before I declare that the poll on that resolution is closed. Once I declare the poll on the resolution is closed, you will not be able to change your choice. I now propose a dummy resolution which is, "Do you like swimming or hiking?" Please remember to press 1 to vote for swimming; and press 2 to vote for hiking. If you wish to abstain, please do not press any button. Please vote now. You have 10 seconds to vote. If you wish to vote, please press the correct button as you wish. You choice should appear on the screen of your handset. [Voting]

[Interpreted] I now declare the poll closed. The results of the poll will be shown on the screen.

[Interpreted] Thank you, Ms. Lee. All directors of the company recommend that shareholders vote in favor of each of the resolutions set out in the notice of this meeting. We will now come to the first resolution to be considered by the meeting, namely the ordinary resolution to receive the audited statement of accounts and the reports of the directors and that of the auditors of the company for the year ended December 31, 2019. I believe you should have all received a copy of or had access to the mentioned audited statement of accounts and those 2 reports through different means. With your permission, I propose that the directors' report and the audited statement of accounts for the year ended December 31, 2019, be taken as read. If there are no questions about resolutions set out in the company's notice of the meeting, we will now proceed to the voting procedures of the resolutions. Ladies and gentlemen, I now formally propose ordinary resolution #1. We shall now conduct a poll on resolution 1. The text of resolution 1 in English and Chinese is now shown on the screen. Please press 1 to vote for and press 2 to vote against. If you wish to abstain, please don't press any button. Please vote now. You have 10 seconds. Your choice should appear on the screen of your handset. [Voting]

[Interpreted] I declare the poll closed. The result of the poll on resolution 1 has now been displayed on the screen. Ladies and gentlemen, as more than 50% of the votes have been cast in favor of resolution 1, I declare resolution 1 carried. We now come to resolution 2. I now formally propose the ordinary resolution to declare a final dividend for the year ended December 31, 2019, of HKD 0.98 per ordinary share as recommended by the Board. We shall now conduct a poll on ordinary resolution 2. The text of the resolution in English and Chinese is now shown on the screen. Please vote now. You have 10 seconds. [Voting]

[Interpreted] I declare the poll closed. The result of the poll on this resolution has been displayed on the screen. Ladies and gentlemen, as more than 50% of the votes have been cast in favor of resolution 2, I declare resolution #2 carried. Resolution 3. In accordance with the company's Articles of Association, Mr. Andrew Clifford Winawer Brandler, Dr. Pamela Chan Wong Shui, Dr. Dorothy Chan Yuen Tak-fai and Mr. Johannes Zhou Yuan will retire and will offer themselves for reelection at this meeting. We will now move to resolution 3a. I formally propose the ordinary resolution relating to the reelection of Mr. Andrew Clifford Winawer Brandler as a member of the Board of Directors. We shall now conduct the poll on ordinary resolution 3(a). The text of the resolution in English and Chinese is now shown on the screen. Please vote now. You have 10 seconds. [Voting]

[Interpreted] I declare the poll closed. The result of the poll on this resolution has been displayed on the screen. Ladies and gentlemen, as more than 50% of the votes have been cast in favor of resolution 3(a), I declare that resolution 3(a) is carried. We now come to resolution 3(b). I formally propose the ordinary resolution relating to the reelection of Dr. Pamela Chan Wong Shui as a member of the Board of Directors of the company. We shall now conduct a poll on ordinary resolution 3(b). The text of the resolution in English and Chinese is now shown on the screen. Please vote now. You have 10 seconds. [Voting]

[Interpreted] I declare the poll closed. The result of the poll on this resolution has been shown on the screen. Ladies and gentlemen, as more than 50% of the votes have been cast in favor of resolution 3(b), I declare resolution 3(b) as carried. We now come to resolution 3(c). I formally propose the ordinary resolution relating to the reelection of Dr. Dorothy Chan Yuen Tak-fai as a member of the Board of Directors of the company. We shall now conduct a poll on ordinary resolution 3(c). The text of the resolution in English and Chinese is now shown on the screen. Please vote now. You have 10 seconds. [Voting]

[Interpreted] I declare the poll closed. The result of the poll on the resolution has been displayed on the screen. Ladies and gentlemen, as more than 50% of the votes have been cast in favor of resolution 3(c), I declare resolution 3(c) carried. We now come to resolution 3(d). I formally propose the ordinary resolution relating to the reelection of Mr. Johannes Zhou Yuan as a member of the Board of Directors of the company. We shall now conduct a poll on ordinary resolution 3(d). The text of this resolution in English and Chinese is now shown on the screen. Please vote now. You have 10 seconds. [Voting]

[Interpreted] I declare the poll closed. The result of the poll on the resolution has been displayed on the screen. Ladies and gentlemen, as more than 50% of the votes have been cast in favor of resolution 3(d), I declare resolution 3(d) carried. We now come to resolution 4. I now formally propose the ordinary resolution relating to the election of Dr. Bunny Chan Chung-bun as a new member of the Board of Directors of the company. Dr. Chan is unfortunately not able to attend our meeting today, but his biographical details have been included in the company's circular of today's meeting. We will now conduct the poll on ordinary resolution 4. The text of this resolution in English and Chinese is now shown on the screen. Please vote now. You have 10 seconds. [Voting]

[Interpreted] I declare the poll closed. The result of the poll on the resolution has been displayed on the screen. Ladies and gentlemen, as more than 50% of the votes have been cast in favor of resolution 4, I declare that resolution carried. We now come to resolution 5. I formally propose the ordinary resolution to reappoint KPMG as auditors of the company and to authorize the Board of Directors to determine their remuneration. We shall now conduct a poll on ordinary resolution 5. The text of the resolution in English and Chinese is now shown on the screen. Please vote now. You have 10 seconds. [Voting]

[Interpreted] I declare the poll closed. The result of the poll on this resolution has been displayed on the screen. Ladies and gentlemen, as more than 50% of the votes have been cast in favor of resolution 5, I declare resolution 5 carried. We now come to the first item of special business of the meeting. I formally propose resolution 6, namely the ordinary resolution to grant a general mandate to the Board of Directors to allot, issue, grant, distribute and otherwise deal with additional shares in the company in the terms set out in the notice of this meeting. We shall now conduct a poll on ordinary resolution 6. The text of this resolution in English and Chinese is now shown on the screen. Please vote now. You have 10 seconds. [Voting]

[Interpreted] I declare the poll closed. The result of the poll on this resolution has been displayed on the screen. Ladies and gentlemen, as more than 50% of the votes have been cast in favor of resolution 6, I declare resolution 6 carried. We now come to the second item of special business of the meeting. I formally propose resolution 7, namely the ordinary resolution to grant a general mandate to the Board of Directors to buy back shares in the company in the terms set out in the notice of this meeting. We shall now conduct a poll on resolution 7. The text of the resolution in English and Chinese is now shown on the screen. Please vote now. You have 10 seconds. [Voting]

[Interpreted] I declare the poll closed. The result of the poll has now been shown on the screen. Ladies and gentlemen, as more than 50% of the votes have been cast in favor of resolution 7, I declare resolution 7 carried. Ladies and gentlemen, all the agenda items have been dealt with at this meeting, I declare the meeting closed. The results of the polls taken on all the proposed resolutions today will be published on the company's website and that of the stock exchange according to the listing rules. Please return the electronic voting handset, the smart card and the interpretation earphone to the designated place as directed by helpers. Thank you so much for your attendance. [Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]