Annual Report 2021

Management Discussion and Analysis 24 CHINA MERCHANTS PORT HOLDINGS COMPANY LIMITED In general, the Group’s ports operation continued to yield stable cash inflow. For the year ended 31 December 2021, the Group’s total net cash inflow from operating activities was HK$8,785 million, an increase of 50.9% as compared with last year, among which, the receipt of cash dividends from associates and joint ventures were HK$3,347 million, an increase of 90.0% as compared with the corresponding period of last year. As the capital expenditure on business acquisitions decreased as compared with the corresponding period of last year, the Group’s net cash outflow from investment activities decreased to HK$4,082 million from HK$6,163 million of the same period of last year. As the amounts of issuance of perpetual capital securities and disposal of subsidiaries were received in the same period of last year, and there was no relevant transactions occurred during the year, the cash flow of the Group’s financing activities decreased from the net inflow of HK$4,375 million of last year to the net outflow of HK$6,129 million during the year. LIQUIDITY AND TREASURY POLICIES As at 31 December 2021, the Group had approximately HK$9,980 million in cash, 19.0% of which was denominated in Hong Kong dollar, 18.1% in United States dollar, 50.5% in Renminbi, 8.7% in Euro, 3.4% in Brazilian Real and 0.3% in other currencies. The Group mainly derived its funding sources from its operating activities related to ports operation, bonded logistics operation and property investment, and investment returns received from associates and joint ventures, which amounted to HK$8,785 million in total. During the year, the Group incurred capital expenditure amounting to HK$1,919 million, while the Group adopted a prudent financial policy and maintained a sound financial position. In addition, as a significant portion of the Group’s bank loans were medium-term to long-term loans, the Group, supported by adequate undrawn bilateral bank facilities of HK$17,215 million, does not anticipate any difficulty in refinancing its short-term loans while the pressure for repaying the short-term loans is limited. SHARE CAPITAL AND FINANCIAL RESOURCES As at 31 December 2021, the Company had 3,785,619,729 shares in issue. During the year, the Company issued 124,531,313 shares under the Company’s scrip dividend scheme. As at 31 December 2021, the Group’s net gearing ratio Note 2 was approximately 22.2%. The Group had aggregate bank loans and listed notes payable of a total of HK$23,311 million as at 31 December 2021 that contain customary cross default provisions. Note 2 Net interest-bearing debts and lease liabilities divided by total equity. As at 31 December 2021, the Group’s outstanding interest-bearing loans and notes are analysed as below: 2021 2020 HK$’million HK$’million Floating-rate bank loans which are repayable as follows (Note): Within 1 year 5,730 6,916 Between 1 and 2 years 1,169 1,123 Between 2 and 5 years 2,866 3,793 More than 5 years 938 987 10,703 12,819 Fixed-rate bank loans which are repayable as follows: Within 1 year 61 772 Between 1 and 2 years 820 — Between 2 and 5 years 31 796 More than 5 years — 30 912 1,598