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258ADVANCING AHEADGroup Financial SummaryEXPLANATION OF ADJUSTING ITEMS(a)EBITDA is calculated as profit/(loss) before tax, adding back depreciation and amortisation and finance costs (net). EBITDA is presented because the Group believes this is a useful measure to determine the Group%u2019s financial condition and historical ability to provide investment returns.(b)Changes in fair value of financial derivative assets relates to (gain)/loss arising from change in fair value of a put option agreement entered into by the Group%u2019s subsidiaries with an agreed floor price to sell its investment in an associate. The fair value is capital in nature and is a non-operational item, which is not directly related to the Group%u2019s operating activities.(c)Impairment on goodwill and other intangible assets recorded within %u201cAdministrative expenses%u201d represent impairment on goodwill and trust management rights of non-core business.(d)In FY2024, share of fair value losses of approximately US$65.3 million estimated from the asset revaluation of Cromwell%u2019s Australia investment portfolio as well as the sale of Cromwell%u2019s European fund management platform and associated co-investments. In FY2023, share of fair value losses related to investment properties and financial assets at fair value through profit or loss.During FY2024, the Group identified its holding in Cromwell as a non-core investment and reclassified the investment to asset held for sale. Consequently, the carrying value of its investment in Cromwell was revalued basedonthemarketpriceasat31December2024andrecognisedanimpairmentlossofUS$147.7millionthatwas recorded within %u201cAdministrative expenses%u201d. Accordingly, these are adjusted to better reflect the Group%u2019s underlying operating activities.(e)%u0009 Write-downofUS$97.4millionarosefromnon-coredivestmentoftheGroup%u2019sstakeinUSHTcompletedon9July 2024, in line with the Group%u2019s strategy to simplify and streamline the Group to focus on New Economy. The impairment of assets held for sale was recorded within %u201cAdministrative expenses%u201d.(f)Share-based compensation expense represents share-based incentives which are primarily non-cash in nature.(g)On 20 January 2022, the Company completed the acquisition of ESR Asset Management Limited (formerly known as ARA Asset Management Limited) (%u201cARA%u201d, together with its subsidiaries, the %u201cARA Group%u201d). In connection with the acquisition, the Group adjusted the following items which are not directly related to the operating activities:(i)transactions costs related to ARA acquisition which are recorded within %u201cAdministrative expenses%u201d are oneoff non-recurring which are not directly related to operating performance of the Group;(ii)amortisation relating to intangible assets arising from acquisition of ARA, net of tax, recorded within %u201cAdministrative expenses%u201d represents management rights recognised that are non-cash and non-operational in nature. Accordingly, it is not directly correlated to the Group%u2019s business performance in a given period; and(iii)share-based compensation expenses relating to ARA which represents share-based incentive granted pursuant to the Company%u2019s Long-term Incentive Scheme which were incurred as part of the acquisition.(h)Reference is made to (i) the announcement (the %u201cRule 3.5 Announcement%u201d) issued jointly by MEGA BidCo and the Company dated 4 December 2024 pursuant to Rule 3.5 of the Hong Kong Codes on Takeovers and Mergers; and (ii) theupdateannouncementsissuedjointlybytheOfferorandtheCompanydated8January2025,7February2025and,7March2025forapossibleprivatisationoftheCompanywhich,ifproceededwith,couldresultinadelistingofthe Company from the Stock Exchange (the %u201cProposed Privatisation%u201d). During the year ended 31 December 2024, the Company has incurred transaction costs in relation to the Proposed Privatisation. The transaction costs is a non-operational item, which is not directly related to the Group%u2019s operating activities.(i)Fair value changes on investment properties represents the changes in fair value which are non-cash in nature. Accordingly, it is adjusted from EBITDA.