AMTD Digital H1 EPS $0.41 Vs $0.15 YoY; Revenue $8.7M Vs $13.9M YoY

Highlights of Half Year Financial Results

• During the six months ended October 31, 2023, despite the global economic slowdown and rising geopolitical uncertainties which led to volatile world markets, the Company demonstrated strong resilience and achieved solid financial performance.
• We generated US$6.9 million in revenue from hotel operations, hospitality and VIP services after the injection of AMTD Assets Group into the Company.
• Fair value gain on financial assets measured at fair value for the six months ended October 31, 2023 amounted to US$16.3 million.
• We recorded other gains of US$14.3 million as a result of disposal of certain subsidiaries for the six months ended October 31, 2023.

Statements from the Board Members:

Dr. Timothy Tong, the Chairman of the board of directors and an independent director of AMTD Digital, commented, "Similar to the year before, the six-month period that ended on October 31, 2023 was filled with challenges. Although the COVID pandemic has officially ended, the global economy in the post-COVID period has yet to fully recover. Geopolitical tensions around the world continue to post serious uncertainties about investments in all sectors of the economy. I thank the management team and continue to be cautiously optimistic about the prospect for future performance growth of AMTD Digital."

Ms. Joanne Shoveller, the Co-Chair of the board of directors and an independent director of AMTD Digital, commented, "The AMTD Digital strategy in diversifying assets and timing of strategic decisions has resulted in these strong interim results and a resilient, innovative and exciting foundation for future growth. The AMTD Digital board of directors expresses their appreciation to the leadership team for their hard work and impressive results."

Financial Results for the Six Months Ended October 31, 2023 Revenue

Our revenue for the six months ended October 31, 2023 was US$8.7 million as compared to US$13.9 million for the six months ended October 31, 2022. Hotel operations, hospitality and VIP services income was US$6.9 million and has become a new revenue driver for us after the successful acquisition of AMTD Assets Group, the real estate arm of AMTD Group Inc., focusing on and specializing in hospitality and lifestyle concepts globally.

Employee benefits expenses

Staff costs for the six months ended October 31, 2023 decreased by 18.2% as compared to the same period in prior year to US$3.1 million. This was due to the tightened cost control in connection with the global economic slowdown and rising geopolitical uncertainties.

Premises and office expenses

Premises and office expenses for the six months ended October 31, 2023 increased by 208.5% as compared to the same period in prior year to US$1.5 million. This was due to the incremental costs attributable to the post-acquisition operations of AMTD Assets Group.

Depreciation and amortization

Depreciation and amortization for the six months ended October 31, 2023 increased by 407.6% as compared to the same period in prior year to US$2.1 million, primarily attributable to the hotel properties of AMTD Assets Group.

Finance costs

Finance costs for the six months ended October 31, 2023 increased by US$3.4 million as compared to the same period in prior year, primarily attributable to the incremental borrowings by the Company, and due to the consolidation of AMTD Assets Group which had outstanding bank loans to finance the underlying real estate properties.

Other expenses

Other expenses for the six months ended October 31, 2023 increased by 821.5% as compared to the same period in prior year to US$4.6 million, primarily attributable to (i) the addition of hotel operation expenses of US$2.8 million incurred by AMTD Assets Group, and (ii) the share of losses of joint ventures of US$1.4 million.

Change in fair value on financial assets measured at fair value through profit or loss ("FVTPL")

Change in fair value on financial assets measured at FVTPL for the six months ended October 31, 2023 was US$16.3 million, primarily attributable to the realisation from gain of entertainment projects during the period.

Other Income

Other income increased by 85.3% as compared to the same period in prior year to US$9.0 million, primarily due to (i) an increase in bank interest income as the Company had generated additional interest income from deposits with banks, and (ii) an increase in the net average outstanding balance due from our ultimate holding company, which was interest bearing.

Income Tax Expense

Income tax expense for the six months ended October 31, 2023 increased by 15.1% as compared to the same period in prior year to US$2.0 million, primarily due to an increase in tax assessable income.

Profit For The Period

Profit for the six months ended October 31, 2023 increased to US$30.1 million.