PT Lippo Karawaci Tbk (LPKR) Earnings Call Transcript & Summary

Good morning, everyone. Please welcome equity investors, bond investors, regulators and credit rating agency to PT Lippo Karawaci Tbk Full Year '23 Earnings Call. Today, as moderator, I'm Randi, as Head of Investor Relations. With me today, we have Mr. John Riady as the Group CEO; and Mr. Daniel Phua as the Group CFO. Today, we will present our full year results, followed by question and answers. [Operator Instructions] Without further ado, please, Daniel, to continue with the presentations. Thank you.

Thank you, Randi. Good morning, everyone. I'm very excited to have everyone here today for us to share about the FY '23 results for PT Lippo Karawaci. Again, just a bit of background. I think this has been a very strong year for Lippo Karawaci as a group. We booked revenue of IDR 17 trillion into FY '23. And as a bit of a background, I mean, for those who are new, obviously, we are the leaders in integrated Real Estate and Healthcare development across Indonesia. In Real Estate, we have a large land bank with end-to-end revenue streams from Real Estate Developments to township management, water treatments and so forth. And Healthcare, similarly, we have end-to-end integrations from clinics referring to hospitals and with over 3,800 GP specialists and 8,000 nurses working in the Healthcare group. We have malls and hotels across 17 provinces in Indonesia, with 1.67 million in NLA being managed. So Lippo Karawaci is a group that touches, I guess, all aspects of Indonesian's life, be it in the Healthcare, be it in housings or be it in Lifestyle and housings. Revenue-wise, basically largely 66% of the contribution is from Healthcare with another 27% from Real Estate and 7% from Lifestyle. With that background, I will move into the key highlights for the results of FY '23. I think a key theme in terms of the performance of our FY '23 is consistency and sustainability. Since about 5 years ago, we have consistently beaten the targets that we have given the market. And that is the trend that we intend to continue. And what's more important is that if you look at our performances year-on-year, there is sustained improvement. We basically -- and those are not through accidents. Those are managed through very disciplined financial governance, very deep research in terms of understanding in regard to what consumers want in the area of both Real Estate, Healthcare and Lifestyles. In Real Estate, we have continued to be the innovators as we have said we would do in the past to continue to look at innovative products and to continue to be a leader in pushing our products that we believe would be of interest to the first home buyers, to the basically middle income. And I would illustrate that a little bit more when I go to the Real Estate sections in terms of some of those exciting products that we have brought to the market in the past. In Healthcare, similarly, we understand that there is an underserved demand in Indonesia due to the lack of many health care services in terms of the variety and the complexity of health care services provided. In the past, I mean, many Indonesian have had to leave Indonesia to seek health care abroad. Our aim is to be able to bring everything, the best health care within region into Indonesia, such that basically any kind of specialized or complex procedures or services that needs to be performed, could be done within Indonesia to keep Indonesians health care within Indonesia. So -- and that strategy has obviously resulted in the strong performances in terms of Q-on-Q, year-on-year growth for Siloam as well. Lifestyle. We continue to anticipate the shift from going to malls or shopping into a more lifestyle malls. And you will see that a lot of our malls continue to transform, to focus more on F&B. And similarly, for hotels businesses, we have been increasingly focused on bleisures and businesses than targeting business travelers who might also want to spend extra time in Indonesia for leisure. As a result, I'm very proud to announce the fact that LPKR has achieved a turnaround NPAT of IDR 50b in FY '23. Now this is the first positive NPAT we've achieved since 2018 through all the incremental improvements, innovative products, financial disciplines that has been exercised in the past 5 years. Now the IDR 50b in NPAT, even if you strip that off various one-off events, I mean, for example, the gains from liability management exercise that was conducted in Q1, the underlying NPAT is also positive. So I think that is a very important factor to consider. And this performance would not have been possible without the 15% year-on-year revenue growth to currently IDR 17 trillion in terms of revenue and a 28% EBITDA growth to IDR 4.2 trillion for FY '23. Highlight in terms of the 3 segments. Real Estate revenue and EBITDA was booked at IDR 4.54 trillion and IDR 1.25 trillion, respectively. So this represents a 10% and a 19% year-on-year improvement. This is anchored by strong marketing sales. FY '24 marketing sales target was achieved, overachieved by 5%. And we are again setting an aggressive target for next year. In addition to beating our record-setting marketing sales target, we do want to overachieve by 10% in FY '24. So we have set ourselves a target of INR 5.37 trillion in terms of marketing sales target for FY '24. Healthcare. Revenue, EBITDA, NPAT have all seen consistent growth year-on-year. Revenue growing by 18% and EBITDA by 31% and NPAT by 61% year-on-year, with revenue closing IDR 11.1 trillion, EBITDA at IDR 2.95 trillion and NPAT at IDR 1.37 trillion, respectively. You would have seen that the operational metrics has continued to improve as well as the company continues to focus on increasing the number and complexity of its clinical programs. And to continue to expand both its hospital base and also the ways that we can reach the various patients through use of teleconsult and homecare services. Lifestyle revenue and EBITDA, in comparison, it is flatter, but revenue still improved by 9% to IDR 1.26 trillion year-on-year. Footfall traffic in malls have increased by 9% year-on-year, averaging 10 million visitors per month. Occupancy rates are stable at 79%. We currently do have various asset enhancement initiative that was put on hold during the COVID period. They have restarted since then, are currently ongoing in 8 malls, and we do expect once those advancement initiatives are completed, it would further boost occupancies and visitors. Hotel average occupancies increased as well, 2% year-on-year to 69% in FY '23. Room rate also increased 10% year-on-year. So this basically anchored the strong performances for FY 2024 -- '23, sorry. Going into the financials in further details. As I mentioned before, FY '23 revenue is booked at IDR 17 trillion, a 15% improvement upon FY '22. This has contributed -- again, you will see the bulk of it came from the Healthcare businesses, whereby it grew by IDR 1.672 trillion to close that to increase by 11% and with Real Estate also contributing to IDR 400b. On the EBITDA side, similarly, I mean, Healthcare has made the biggest contributions with 21% contributions or about close to IDR 700b with Real Estate coming in at 6% with the IDR 200b contributions for us to close at EBITDA of IDR 4.2 trillion for FY '23. Again, if you were to look at the year-on-year performances, you will see that the CAGR for revenue sits at about 5% CAGR from FY '21 to '23. For EBITDA, it's 12% and GP at 8%. NPAT, obviously, is a lot more significant. Starting from NPAT, you will see that we -- the underlying NPAT, I mean, it went from a negative IDR 1.1 trillion in FY '22 to IDR 76 billion in FY '23. And that has built off already a strong improvement from FY '22 to FY '21 as well from a negative IDR 1.668 trillion to negative IDR 1.11 trillion. The NPAT closed at IDR 50b. NPAT this year was influenced by 2 key matters. The close to IDR 1 trillion gain from the liability management offset by about IDR 700b fair value adjustments from the limited properties. I will cover those in further details. Again, year-on-year, as you can see, EBITDA improved by 28% on -- behind the revenue increase of 15% year-on-year. This allows us to achieve a close to doubling of our NPAT compared to the year before. Here, I want to give a bit more color in regard to the underlying NPAT. You will see that in FY '23, the EBITDA improved by 28%, as I alluded to earlier. Net interest expense came down slightly as a result of the liability management exercise. There were obviously some one-off fees that had to be offset. Therefore, the overall interest movement would look less. Amortization and depreciations continue to improve as more of Siloam Hospitals matures. And running down on its depreciations, we do expect this trend to continue. The tax increase is in line with the increase in EBITDA. And the other's role is mainly consists of the rental of the pre-PSAK 73 rental calculations basically, and you will see that, that has decreased as well from FY '22 of about IDR 1.9 trillion down to IDR 1.56 trillion in FY '23. So this allows us to print an underlying NPAT of IDR 76b, as I say, over 100% improvement on FY '22. You would know as well that for those who are following us closely, that the underlying NPAT has been improving consistently since 2Q. So 3Q is an improvement on 2Q. And as you can see here, 4Q '23 is a 43% improvement upon 3Q '23. Below the underlying NPAT, there are various nonoperating adjustments that we basically separate out, so that it's easier for investors to understand our underlying performances. There is a IDR 745 b in the fair value adjustments of LMIRT's investment properties. This basically represents our 48% share in those fair value adjustments. Now during 2022 -- 2023, sorry LMIRT had a change in value. The new value took a slightly more conservative approach in regard to the cash flow generated from the LMIRT properties. Therefore, this resulted in a fair value adjustment in terms of the value of malls that is carried in LMIRT's books. Now keep in mind, LMIRT account for its properties on a fair value basis, whereas Lippo Karawaci accounts it on a historical cost basis. But considering that LMIRT is currently no longer subsidiaries, but an affiliate, this is basically represents our equity accounting share of the fair value adjustment, which is a noncash adjustment in terms of the value of LMIRT's properties. Again, on a bond buyback, I think we have shared this in Q1 previously, IDR 1.1 trillion, which obviously carried into the full year, and that basically gives you the IDR 50b NPAT results for FY '23. EBITDA by segments. Happy to report that the margins have expanded for both the Healthcare and the Real Estate segment. For the Lifestyle segment, margins decreased slightly -- on account of slight decrease in margin for malls, mainly because for malls, there were various one-off events during 2022 coming out of COVID in regard to late penalty and deferred revenue, which is basically a catch-up in regard to items that were deferred from COVID. So there were some exceptional items in 2022. Once you take out those exceptional one-off items, I would say that '23 versus '24 EBITDA for our lifestyle businesses, so it is relatively flat. So the improvement is largely -- has been helped by improvement in both the Healthcare and Real Estate businesses. Okay. Moving on. This is a new way of presenting the segment compared to what we used to do previously. For those who have been following us, you may have noticed, I've now split out the Holdco segment from Real Estate. In the past Holdco and Real Estate is combined. I think that doesn't give the investors a proper understanding in regard to the performance of the Real Estate business. So what we have done this year is that we have split out Holdco. I mean the Holdco, as you can see, is mainly the interest for the bonds and also the rental support that is in other columns. So we have [ parked ] out the Holdco interest and obviously includes some of the OpEx as well. So we have parked out the Holdco component separately, so that it's easier for you to see the performances of the various segments. Now once we parked out the Holdco from Real Estate, you would notice that the Real Estate segment is, in fact, generating the highest EBITDA out of all the businesses so far. So it is generating a 27% EBITDA margins compared to Healthcare, which is generating 26% and lifestyle with 23%. Last year, similarly, I mean, the Real Estate was generating 25% versus 24% in Siloam and 26% in lifestyles. Once you take it down to the underlying NPAT, you would notice that due to the fact that Real Estate obviously has very little depreciation compared to Healthcare. The underlying NPAT for Real Estate is actually substantially higher than Healthcare at 22% versus 12% that you get in Healthcare. And this obviously carries all the way down to the NPAT margin, whereby Real Estate is supporting a 19% NPAT margin compared to 12% in Healthcare and 3% in Lifestyle. I hope that this gives a better understanding of the performance of the Real Estate businesses. As I mentioned in the past, Holdco and Real Estate was combined, which I feel that do not give a fair representation of what the Real Estate segment is doing. Our cash flow, I'm very excited to report the improvement in cash flow as well. Operating cash flow went from negative IDR 235b in FY '22 to a positive IDR 2 trillion in FY '23. This is obviously driven by the improvement in EBITDA and also various initiatives that has been taken by Siloam and our other businesses to continue to drive improvement in working capital. The IDR 1 trillion investments is mainly outflow from Siloam to continue to invest its earnings into equipment, into beds, into various expansion and extensions to continue to generate improvement in both average revenue per bed and also throughput. Other than that, net, we also paid down IDR 1 trillion in terms of net financing to reduce the overall debt for the group. So overall, I would say that from a liquidity perspective, the group is definitely in a much stronger position compared to where it was a year before. Whilst I do not present a specific slide, some of you will probably ask me about what is the status in regard to Holdco cash flow. I'm happy to report that the Holdco cash flow for this year basically shows a negative movement of about IDR 100 billion, and this is a substantial improvement when compared to what we were doing, let's say, 2020 or 2021, whereby it was about negative IDR 2 trillion and negative IDR 1 trillion, respectively. So as a result of this improvement, the operating cash flow for the Holdco, this is -- as those of you who have been following us, after taking into account the interest payments and the rental support, once you offset that with the dividends from the groups and the performance of the property businesses, we are currently -- have a delta of about IDR 100b, which, again, coming back, is a substantial improvement upon the performances from previous years. Liability management exercise. I won't dwell too much on this. I think I've covered this in sufficient details in Q1. But obviously, as you can see, we have now half of our outstanding bonds by basically transitioning that into a syndicated loan of IDR 5.25 trillion loan. It allows us to have various advantage in regard to improving that maturity profile. I mean, lower blended interest rate as a whole, and we are not exposed to the interest rate mismatches and overall healthier debt-to-equity ratio at 0.59x. And again, those of who you recall, our -- we do have core options to protect the principles of our bonds. So whilst you do see some of the FX movement reflected in our P&L, those are largely nonrealized FX movement that we have to carry on our books, but the principles is 100% hedged. All right. I'll move on to Real Estate. So there's an overview of the financial performances for the group as a whole. I'll cover a bit more details in regard to the Real Estate performances before moving into Healthcare and Lifestyle. Marketing sales, as I mentioned, we did IDR 5.12 trillion in FY '23. That is a record marketing sales that we've been able to achieve, and this is 5% above the FY '23 target, and we continued to -- this was anchored by a very successful launch of Park Serpong in Q4. But again, I'll give a bit more highlight of that in further slides. Financials wise, handover has been on track and resulting in the 10% year-on-year growth in Real Estate revenue. And similarly, that gets reflected in growth in both GP and EBITDA as well. EBITDA grew by close to 20% year-on-year. But we are optimistic. I think based on especially the stronger performances from Park Serpong in 2023 that we believe that we can improve the already stellar performances in marketing sales this year and outperformed that by another 10%. So we have set ourselves a target of IDR 5.375 trillion in regard to marketing sales for FY '24. And so far, based on the performances in January, February, I believe that we are definitely on track to achieve that target. But I will probably share more with you about that in our 1Q performances next month. Again, historical performance is coming back. My same consistent theme of consistent improvement year-on-year. Marketing sales, we've seen a 26% CAGR from 28 -- from 2018 where we were doing IDR 1.6 trillion up to close to IDR 5 trillion that we are doing -- over IDR 5 trillion that we're doing right now. And this is anchored, obviously, still majority by Lippo Village projects, followed closely by Lippo Cikarang and other projects. There's over 1,000 hectares of land banks available currently, which translates to about IDR 155 trillion in GDV, and this allow us to have 25-plus years of ongoing developments. So we do believe that these performances, therefore, would be sustainable going forward as well, and it's not due to any one-off event. Again, no surprises. I don't think this is a change in terms of our strategies. The marketing sales is still largely anchored by landed housing, whereby as you can see, in volume landed housing made up to 82%. And in the absolute amount, it also made up 80% in regard to the marketing sales that was printed for 2023. The majority is still coming through mortgages. I don't think anything has changed in there. And you will see, again, similar to our strategy in the past, there is still largely anchored by landed housing with 50% volume in there. And in regard to the segment, we continue to target the affordable Housing segment. As you can see in FY '23, 54% of the sale is from segment, whereby the ticket price is less than IDR 1 billion. So here, some of the new properties that were being developed. I will probably skip that one. And also in regard to handovers. Handovers, here are some of the key handovers that we have completed during the year. I would -- happy to report that the handover is largely on track, which is high, allows us to achieve a 10% year-on-year improvement in regard to revenue to close at IDR 4.5 trillion. I do want to spend a little bit more time to talk about the Park Serpong project. We are very excited by this launch. It is a project at the centre of Serpong. It is 400 hectares of master plan development. And the interest has been phenomenal for those who have been following us on the launch. It's been very well attended. It had been a [ solar ] event both for the launch of the residentials and launch of the shop houses. This is primarily due to the fact that we are offering an innovative product at a price point that matches what first home buyers are looking for. And having all these located in strategic locations that is in the center of Park Serpong, that is really very close to nearby facilities, including school, universities, shopping centers, parks, public transports, and we wanted to build a modern township as well. Those of you would have visited -- who have not visited, I would encourage you to pay a visit to our show units, along with the club houses that have been built. We do want to offer a modern, innovative living environment for our consumers. Here are some of the key products that we have launched. Again, the XYZ Series, targeting the Gen X, Gen Y and Gen Z with prices starting at under IDR 300 million going up to just under IDR 600 million. Again, it's been 100% take-up. The interest from the market has been phenomenal, which is why we will be doing a second launch in coming months in Park Serpong. And as part of the second launch events, we will also be introducing a new product called Q Livin. Again, this continues the trend that Lippo Karawaci has set as a leader in coming out with innovative products. Q Livin is new, in that is centered by the concept of a center courtyard, whereby you have a center courtyard as a key design of the units and is integrated into how -- into the living room, into basically how the units is connected as well. We have seen strong interest in the Q Livin series as well. And we do believe that this would anchor the second launch event of Park Serpong, which will be in coming months. And obviously, with the Park Serpong, we also have the Cendana Series, which is continuing the same trend that we have established with a slightly higher starting price of about IDR 700 million and high shop houses with the triple key concept that have been very popular in the past. We will also be continuing with those. Probably at this stage, I'll take a pause. John, if you have any comments to add in regard to Real Estate?

Not right now, Daniel. I do want to make a couple of comments. I wanted to finish off and maybe before the Q&A, I'll make a few remarks and then open -- start the Q&A session.

Okay, sure. I will continue into Healthcare segment. Healthcare, again, I'm sorry to sound like a broken record, but I do have to repeat, consistent performances. As you can see from FY '19, I mean, despite COVID and coming out of COVID or disruptions related to COVID, Siloam has been able to perform consistently on the top line and the bottom line. Revenue has grew by CAGR 7.4% year-on-year, EBITDA by 17.4% year-on-year and net profit by 21.1% year-on-year. Now as you can see, obviously, from revenue down to EBITDA to net profit, margins have expanded at both an EBITDA level and a net profit level as well. I mean, FY '19, I mean this is the pre-COVID era. I mean, Siloam was doing 16.6% EBITDA margin. In 4Q of '23, Siloam is doing 21.4% EBITDA margin. So there's a substantial improvement in terms of margins that the company was able to achieve. Again, this was achieved through various programs to improve the complexity of clinical programs to look at how to optimize cost and also to look at how to optimize the mix of our payer groups. Revenue grew by 17.2%. This is based on the Siloam published numbers, so this is not before eliminations, just so that you can compare that with numbers that was actually published by Siloam. EBITDA grew by 34.6% to close to IDR 2.67 trillion with net profit growing by 75.5%. Again, I think I do want to highlight, coming back to that, improvement in margins, for example, NPAT was 9.6%. NPAT margin in FY '22 growing to 14.4% in the FY '23. Now if we were to look at the performances of Siloam, let's start with revenue. The way to understand the revenue of Siloam, basically, a revenue for any Healthcare business is anchored by 3 key components: Firstly, the average revenue per bed; secondly, the throughput; and third, the payer mix. Let's start with average revenue per bed or the revenue intensity of Siloam. You will see that the revenue intensity or the average revenue per occupied bed of Siloam has been maintained at IDR 3.3 billion per bed -- per occupied bed. Now if you were to compare to the peers within Indonesia, this is basically doubled what our peers are doing. And we have been able to maintain that lead of average revenue per patient base. Again, you are seeing here is telling a very similar story. This is deliberate. Since 2019, as part of Siloam 5.0 strategy, the focus has been on increasing the complexities of services that Siloam can provide. As I mentioned earlier, we want to make sure that any services that our patients can get outside of Indonesia, they will be able to get in Indonesia. So that reduces the need for people to travel to places like Singapore or Malaysia to get their treatment because they cannot get similar treatment in Indonesia. So Siloam has continued to grow and focus on what we call the CONGO services of cardiac, oncology, neuro, gastric and orthopedic. And the focus on CONGO has been an anchor point for us to drive the growth in revenue intensity. The second factor in regard to revenue growth is obviously throughput. And in throughput, you will see that, that has improved year-on-year as well. Inpatient admissions has grew by 25.6% year-on-year. In-patient days has grown by 15.5%, with average length of stay going down from 3.3 to 3.1. Again, for the Healthcare business, we do want to bring that average length of stay because with a lower average length of stays, it allows us to turn over the base more often. Now the way we achieve a lower average length of stay is by utilizing home care, is by utilizing teleconsults so that people -- the patients who no longer needs to be treated in the hospitals can be treated outside. Occupancy rate, as you can see, has improved by over 10% to close at 65.2% compared to 58.9% the year before. Outpatient visits have seen a 23% improvement as well to basically close at -- close to IDR 4 trillion, along with what we call OPD to IPD conversion rate, which is how many of the OPD visits get converted to IPDs. And as you can see, that improved to 2.9% in FY '22 to 3.1% in FY '23. Moving on to cost. As I alluded to earlier, that we have seen a substantial improvement in the EBITDA margins for Siloam year-on-year. And this is driven through a strong focus on the cost management and efficiencies. You can see starting from drugs and clinical supplies, in 4Q '19, which is basically the quarter before COVID, drugs and clinical supplies made up 35.1% of revenue. And that has steadily decreased. And as of 4Q '23, it made up 28%. Operating expenses, similarly, has gone from 36.1% in 4Q '19 to about 31.9% in 4Q '23. Now some of you would notice that there is an uptick in 4Q '23 OpEx compared to 3Q '23. That is normal because usually, we onboard our nurses in the fourth quarters. So when we onboard our nurses, there's usually a bump in the OpEx for that quarter. But EBITDA margins, as you can see, has gone from 18.4% in 4Q '19 to stabilize at over 30% since 3Q '23. Net profit margins, I think, is also stabilized at around 15%, 16%. And the [ Alvares ] initiative that Siloam is still working on in order to continue to drive improvement in margins, including looking at revenue leakages, including look at how we procure for contract services, including various E&T-related initiative to reduce electricities, waters expenses and so forth. So we do believe that the EBITDA margins do have room to improve further going forward from various initiative that management has identified. Payer group continued to focus mainly on non-BPJS. As you can see, the non-BPJS payer group is steady at about 81.6% of revenue. Some of the key projects that Siloam is currently undertaking. There is some expansions being carried out in the Makassar. And we, basically, as part of our strategy, to improve what I said earlier in relation to CONGO, oncology is obviously one of our key focus areas, we are building up a new oncology center at Lippo Village. The oncology center will be called MRCCC as well because that is going to be our branding going forward for our one-stop shop oncology centers. So there will be oncology centers brand new being built outside the current Lippo Village hospitals. It will be equipped with a linear accelerator as well. We are basically making good progress on our Surabaya hospitals. As a lot of you may know, we do have flagship hospitals in Surabaya, but it is getting very old, and we are building a brand new hospitals to take over from there. So we continue to focus on digital. Digital is -- it continues to be a very key focus of Siloam. But as mentioned, that allows us to serve more customers without necessarily having them coming to hospitals. I mean, it's true, various channels like [indiscernible], homecare and teleconsult. We also had a lot of focus on the patient experience. There was a [indiscernible] campaign that was carried out to remind our people in terms of what it means to provide top customer services. We have -- if you visited Siloam recently, there has been the single queue systems being introduced. We have reduced our waiting time significantly compared to what it was even just at the start of this year. But there is now a digitized patient feedback system, whereby any complaints from the patients is automatically escalated to relevant level of managements. And currently, these complaints, we're happy, to report are resolved, 80% of them are resolved in less than 2 hours. We have 846,000 outpatients booking through our digital channels, and which allows the patients to basically check their appointment time, be able to track their numbers in the queue, be able to see basically the diagnosis, be able to see the drugs that has been prescribed. And we are continuing to look at ways to enhance the functionalities of MySiloam as well, but including investigating in the use of AI in basically better be able to serve both our patients and our doctors. I would say keep your eyes peeled in regard to the digital services for Siloam. There are certainly a lot more enhancement that we have planned down to track, and we have allocated appropriate resources to continue to improve the digital experience for our patients as well. Lifestyle, again, a brief recap. We are the largest mall operators with 59 managed malls across Indonesia, supported with well-known tenants. There is now, as you can see, a slow shift away from kind of department stores way into kind of more F&B and more bespoke tenants and moving away from anchor tenants. And we do see the shift happening across the board. Malls revenue has improved by 11% compared to last year, and EBITDA is down. As I mentioned earlier, there were some isolated one-off event in FY '22 as a result of catching up after COVID. So it was an exceptionally high EBITDA for FY '22. Once you account for those one-off differences, most EBITDA each is largely flat as reflected by largely consistent occupancy rate from the malls. Hotels, briefly. Hotels revenues has improved by 20%. EBITDA margins for hotels continued improvement pre-COVID. Prior to that, it was doing about 20% EBITDA margins. We're now doing close to 40%. This is a result of various efficiency improvement that was carried out during the COVID era that was successfully carried over post-COVID in order to maintain a strong EBITDA margins. As a result, you can see EBITDA for hotels went up by 28%, occupancy is up 2% with average room rates up 10%. Looking ahead, for Real Estate, we will continue the proven strategies that we have carried out in the past to offer innovative products, I mean, for the XYZ and the Q Livin series. We do continue to see strong demand for the affordable housing segments as evidenced by the successful launch of the Park Serpong partnership and further launches our plans. And so far, based on the priority path, we do see strong interest continuing for Park Serpong as well. But as mentioned, we do anticipate that the marketing sales, I mean, will be 10% higher. We are anticipating new launches, not just in Park Serpong, but also in Lippo Cikarang and GMTD in the Makassar as well. In regard to Healthcare, the company's strategy to focus on increased complexity and diversity of clinical programs have anchored the strong performances of Siloam. So it has paid off. And why fix something that's not broken. And we do see that the way forward is to continue on this proven strategies. We do see a lot of our competitions are doing something similar right now in terms of where they're heading, which again further shows that we are on the right path. There are currently 5 hospitals in constructions in densely populated area. But these are basically -- we are working on the hospitals in Kemang. We are working on a hospital in Bandung. There's another 2 hospitals planned in the Surabaya. So this will continue to improve access, not just by having a physical -- small physical hospitals for our patients to visit, but also through our digital channel, whereby there will be more ways whereby our patients can access Siloam services as well. Our malls, we do expect to see ongoing year-on-year improvement coming out of COVID. It will be held as an enhancement initiative that was stalled during the COVID era, that has now since resumed post-COVID. And once these refurbishments are completed, for example, in Plaza Semanggi, we do believe that this will bring substantial improvement in the income for the malls businesses. Aryaduta have seen gradual return of tourists. We saw, for example, the Chinese tourist to Manado is still not 100% back to what it was pre-COVID, but we are seeing that the trend is continuing to be positive. So we do expect that, that will continue to help the performances for the Aryaduta Hotels as well. So that is all from me in regard to the financial and operational update in regard to Lippo Karawaci. Again, very excited with our consistent performances, very excited by the prospect of what it means going forward. With that, I will close and pass the time to John for any closing remarks before we open the floor for Q&A.

Thank you, Daniel, and good morning to all of you on the call today. A couple of comments. And generally, I'm echoing the remarks and the sense of -- I'm pleased to hear with some of the results that we've been able to deliver this year. I'd say that, generally, I'm very pleased with how each of our management teams across the Real Estate business, the Healthcare business, the Malls business and also the Hospitality business have been running our respective businesses and really focusing on operations. And if you -- for those of you who've been following our call over the last 3, 4 years, it's really been about that operations, how do we have better and stronger operations. And I'm pleased that gradually, we're seeing that translate to better P&L, stronger cash flow and then gradually also a moderately stronger and stronger balance sheet as well. And so despite all the challenges we've have been through with COVID, all the disruptions around the pandemic, we've been able to overcome and, in some instances, actually capitalize on the opportunity to be able to cut costs and further streamline and make our businesses more efficient. So here we are with our FY '23, a lot of good work in the last 1 year, and I think a great foundation for us to continue to build on as we look at FY '24. So those are my general remarks on FY '23 results. I'll open it up to questions. And while I give an opportunity for all of you to feel free to send the questions on the chatbox, I will begin by answering a couple of them that I see here.

First, generally, on the Real Estate market, people are asking about more macro stuff. Look, I think the Real Estate market in Indonesia, I'd say, is flat to slightly positive. Obviously, if you take a look at our marketing sales results, a number of our peers, generally, there's been a nice growth as sort of a mid- to high single-digit growth year-on-year. And that's reasonably reflective of where the market is. I don't think we're seeing a significant improvement in demand. But I think what we're seeing is an improved ability on the part of the developers to come up with products at the right price points and that are more appropriate for the market with a stronger product market fit. And so by doing that, we're able to see marketing sales increase. But that's not necessarily reflective of a stronger demand environment for home sales. And I think for the next 1 year, that will remain to be the case. Now if you pull further out beyond the Real Estate market itself, I think the general sentiment in Indonesia is positive or has become more positive compared to, say, 6 months or 12 months ago. And again, I see a number of questions here around the impact of the election results, the impact of various macro trends on Indonesia. I say, generally, in the last 6 to 12 months, there's been 2 developments that have reduced a little bit of the uncertainty around 2 things. One is the election overhang, obviously. As you know, we're not -- this whole year is full of elections. We're not completely done yet. We've got local elections coming up in the third or fourth quarter of the year. But generally, I think there's a sense of relief that the presidential elections have been completed with -- fairly smooth and fair. And I think we anticipate a smooth transition later on this year. So generally, that's been a big relief. And I think that also allows a lot of the consumers to also move forward with larger ticket purchase items. And hopefully, as there's more and more clarity also allowing FDI and investments, especially in industrial land, things like that, to also improve this year. So that's, I think, one uncertainty that's been there. The second one that I think a lot of people and a lot of consumers are watching for is interest rates. To the extent that the U.S. that the Fed starts to ease, if they do, I think that will provide room for [ Indonesia ] to do the same. Compared to 12 months ago, I think we have a little bit more clarity, at least people think a bit more clarity, although I don't know, looking at the news stream in the last 2, 3 weeks, maybe a little bit, more 50-50 now. But these are, I think, the 2 base sort of macro issues that people are watching and so if we can get a really more clarity around politics, if we can get a little bit more clarity around interest rates. I now will provide a little bit more tailwind behind all of our businesses, all of our consumer businesses. So we'll be watching that closely. There are also a number of questions here with regard to LMIRT. This is the only -- this call is for [indiscernible], I won't comment on LMIRT. But I will say just one thing, which is that we continue to provide LMIRT and the management team there as much support as we can. This is something I've mentioned over the last 6 to 9 months. And so I'll say that we will continue to do that. I think the LMIRT management team has done a reasonably good job amidst the circumstances, a difficult environment that we're in today. But I think given that the underlying of the business of LMIRT continues to perform reasonably well and some of the efforts that they've been able to secure and support that we've been able to secure from the banks and allowing them to conduct the number of exercises that they have in the last 6 months. I'm optimistic that they will be able to find a full solution to some of the remaining issues that they have to address our upcoming maturities this year. Having said that, I don't think they're there yet. And I think James' view in his most recent call a number of weeks ago have conveyed the same. But I can assure you that James is doing his best and Lippo Karawaci is providing as much support as we are able to. With regard to Lippo Karawaci's upcoming maturities, we have a maturity, as you know, in 2025, at the beginning 2025. It's not something that we have a plan for yet, but we are conscious of the next 12-month horizon. And hopefully, in the upcoming calls later on this year, we can provide more clarity on what our plans are. I do think we have options. Having said that, I do recognize that this is a very difficult environment for refinancing of this size. So we'll be keeping you posted on that as well. I think that covers a number of the different questions here. There's a question on how we should value Lippo Karawaci's sum of the parts? No, I want -- I think you guys are the experts on this. Whether we should include LMIRT or not. My response to that would be why not, right, include whatever market price the units are trading on. It's really your call. Daniel, anything else you want to add? Or if there are any further comments, please feel free to...

Yes, I'll probably just close it off. I mean the lovely management -- again, all this has been published in the Q1. I probably won't repeat a lot of those details that's already been mentioned. High level, again for those that weren't following before. I mean we retired half roughly at this time. Overall, that was over IDR 1 trillion gains that was booked in our book. Holdco cash is at about just over IDR 1.2 trillion. Again, as I mentioned earlier during my presentation, basically a IDR 100b delta compared to the year before, which I think is very positive. So with that, I think we have addressed basically all the questions that has been raised. And I think I'll pass the time back to you, Randi. I think we're just actually on the dot.

Thank you very much, Daniel. Sorry, Mr. John Riady must leave earlier. Thank you for your attendance today at our full year '23 earnings call. Happy fasting month for you who celebrate, and also happy Easter this week. And see you again for the next call next month. See you, and thank you. Bye-bye. Thank you, Daniel.

Bye-bye.

Bye.