Welcome. Good to see you all. Our final results were announced to the stock exchange earlier this afternoon. Peter Borer, COO, and Matt Lawson, CFO, you know already. The disclaimer statement you are very familiar with, so no need to go through that. Overview. I think we're pretty happy with the results. It wasn't an easy year. Obviously, a lot of big uncertainties around the world at the moment, such as the trade war, Brexit, and things like this. Given that situation, our earnings, I think, were quite satisfactory. Our brand continues to be very well-recognized. Peter was recently on stage in Los Angeles with all of his general managers to celebrate that we are the only and the first hotel group in the world where all of our hotels have been rated Forbes Five-Star.
Nowadays, of course, there are many hotels that call themselves five-star, but the Forbes Five-Star award is a very specific award that is only given out after a very stringent set of criteria, and we are the only hotel group that all of our hotels are Forbes Five-Star. We're very pleased about that. Before going into some of the financials and so on, we thought we would just run through some of the milestones that we're putting into our annual report, which gives you a bit of color of what is happening around the group. Some of this is a bit more lighthearted than other stuff. Here, the photo on the left is Peak Tram. We'll talk a little bit more about the extension of the operating right for another 10 years and the expansion project, which you're aware of already, but I'll update you on that.
The two photos on the right, of course, depict Peninsula London. The photo on the top right was actually taken by me, about six weeks ago, I would guess. I have to admit that the weather that day was miserable and we photoshopped the blue sky onto the photo that you can see. Again, we'll give an update on the new hotel projects later on. The next slide, top left is the Z Bar in Chicago, which for us is quite interesting. It's a new F&B approach that we've taken. We've brought in mixologists and a new sort of marketing campaign, a lot of social media, e-commerce, influencers, and stuff like this, and it's all working pretty well. Top right, the annual report last year effectively won the world's best annual report at the ARC Awards in New York.
It beat off all of the big U.S. multinationals and so on to be awarded Best of Show. Bottom left-hand photo is a bunch of people receiving the BREEAM certification in Beijing, which I understand is the first time that a BREEAM for sustainability has been awarded for renovation of a hotel. Bottom right is the relaunch of the Peninsula Merchandising boutique line, which occurred middle of last year, and it's been performing pretty well. New packaging, new products, and of course, you can go and buy some of that stuff at either the Peninsula Hong Kong shop or the airport shop. Or online. Oh, sorry, forgot that. The next page, well, the Peninsula Hong Kong celebrated its 90th anniversary. We did a number of things.
For instance, one of the things we did was we now have a Peninsula Yacht in Hong Kong that customers can go and enjoy the lights, go for a sunset cruise and so on. It's all very Peninsula style. I've been on it. It's very nice. Top right-hand photo, this is our startup program. We had a pitch night for some of the startup businesses that had applied to be included in our program, which we're running together with the Stanford Research Institute. We selected two winners that we're actually working with at the moment in our lab in Aberdeen to develop an innovative new product together with us. Very exciting stuff to be with some young entrepreneurs and talking to them about innovation. Sustainability, that glass of lemon tea is showing you that it doesn't have a straw in the glass.
We have imposed that as part of our campaign against single-use plastics. We do provide paper straws on request, but we are eliminating. We're working on other types of plastic as well. This is only one category that we're starting with. The next one, Peninsula New York 30th anniversary. Art pieces including by Andy Warhol, and on the right, Peninsula Bangkok's 20th anniversary, where we offered some cultural experiences for our guests. In your press pack, you will see that I have slightly changed the format of the CEO statement this year. In the past, it was more in the nature of an operational review. This is a more strategic statement. Please read through it. I obviously don't have time to run through the whole statement, but within that statement, I think we can mention a few things.
Obviously, our overall vision is still to develop and operate a small number of the highest quality hotels in the world. Actually, there are a lot of changes going on in the world with technology and so on, but we believe that the fundamentals do not change. What people care about is personalization, attention to detail, graciousness, hospitality, guest recognition. All of those factors are the key things that we work on. Technology is to enable better service. I have already mentioned that we set up the technology transformation committee, and within that, we're looking at digital marketing, social media, data analytics, guest room technology, back of house technology, robotics, financial systems, HR systems, and quite a wide range. We see technology as an enabler for us to provide better service, not the other way around.
Never say never, but we do not intend to have robots serving guests. China's important, so we're emphasizing China. We're doing a lot of work to try and improve our reach in terms of sales and marketing in China. That's something we're working on. For instance, we're looking at opening some more Peninsula Merchandising shops in China. That is something we're looking at. Obviously, the Greater Bay Area is something that people are talking about, so we're looking at what we can do. No plans to open a Peninsula hotel in the Greater Bay Area for the time being, but shops certainly would be a possibility. People, obviously very important. As always, we do a lot in terms of training, career development, empowering staff, cross exposures, and the whole works. As a result, we enjoy pretty good loyalty.
Our staff turnover numbers are relatively low, more importantly, the long service amongst our key managers is very high. As I said, some of that stuff is encapsulated in the CEO statement. Okay, Matt, can you please do a quick summary of the numbers?
Certainly. Thank you, Clement. Good afternoon, everybody. Starting with a few key highlights. Our revenue was up 7% year-on-year to HKD 6.2 billion, and our EBITDA was up 9% to HKD 1.55 billion. If we look at our earnings growth across our businesses, it was fairly broad based. It was further assisted by the fact that we had a full year of operations from our newly renovated Peninsula Beijing hotel. We also had a full year's rental contribution from 21 avenue Kléber, which is our office and retail property adjacent to the Peninsula Paris. Our underlying profit came in at HKD 765 million, which was 4% lower than last year. It's important to remember that this number includes the gain on the share of the apartments sold in Shanghai, of which we have a 50% interest.
If you strip that out to get a better view of our underlying earnings from our operating businesses, you'll see that in fact, we increased our underlying earnings, excluding apartment sales, by 14%. To HKD 742 million for the year, which we think is a credible result. Our total assets is edging closer to HKD 50 billion, whilst our net debt to assets remains very conservative at about 12%, which is up one percentage point from last year. Despite having slightly higher net debt, in fact, we saw cash interest cover improve over the period to close to 13 times, that was a consequence of having higher earnings. Finally, we've declared an interim dividend of HKD 0.16, which takes our full year total to HKD 0.21. That's up HKD 0.01 or 5% on 2017 numbers.
As I just mentioned, growth was broad based across not only all of the divisions, also all of the geographies in which we operate. Our largest revenue contributor continues to be Hong Kong. You can see by the chart there, it's up 4%. Hong Kong's always going to be a little bit more stable because of our comparatively large commercial property portfolio here in this market. Other Asia was very much boosted by the return of The Peninsula Beijing to full room inventory. The U.S. and Europe generally performed well. The Peninsula Chicago is benefiting from its new room renovation, also from the opening of the Z Bar. Paris market generally also saw recovery in Europe. If we turn now to the results of each division, the Hotel division continues to be the main contributor to the group's results.
It's accounting for about 60% or 58% of our combined EBITDA. As this chart also illustrates, it was also the main contributor to our earnings growth in 2018. Generally, across the hotel portfolio, we saw good growth in our rooms division, and we saw good growth in our food and beverage. Retail over the past several years has been challenging. I'm pleased to say that in 2018, we're starting to see positive rental reversion. Not yet reflected in the gross rental numbers, but we are starting to see positive rental reversions after many years of negative rental reversions. The commercial properties division performed well. We saw strong contributions from the Peak Tower, for example, St. John's Building here in Hong Kong. I've mentioned 21 avenue Kléber, and the Repulse Bay was fairly stable.
Within the clubs and services division, Clement's already mentioned with Peninsula Merchandising, we relaunched our products in the middle of last year, that had a positive effect on their earnings. The Peak Tram is benefiting from the new rail and also bridge linkages into the Chinese mainland. Looking at our cash flow statement, the theme for cash flow is very much as I've communicated last year or in our interim. That's really that our capital expenditure is shifting from our existing assets and starting to ramp up on our new hotel projects. Our after-tax net cash generated from operating activities for 2018 amounted to HKD 1.38 billion, of which about HKD 430 million was applied to fund CapEx on our existing assets. About HKD 1.2 billion was spent on new projects in 2018, our net cash flow for the period was less than HKD 400 million.
I think that's a credible amount given the sheer amount of construction going on. What it tells you is that not only were we able to comfortably cover our CapEx on our existing assets from existing operating cash flow, but also the majority of the spending on our new projects. This slide shows our borrowings and our key debt ratios. I think people who have been following us recognize that our company's approach is to be conservative with respect to our capital structure, we really see this as a defense against potential unforeseen volatility or stress in the markets in which we operate. During the period, our net borrowings increased by 7% to HKD 5.9 billion, and our net debt to total assets, as aforementioned, increased to 12%. The increase in the debt, obviously, mostly attributable to the new hotel investments.
Our cash interest cover, as I've already said, has improved over the period. Our weighted average interest costs remain low and fairly stable at 2.3%. In terms of de-risking the balance sheet, we've also locked in about 73% of our total borrowings. Looking forward, we do have significant capital commitments across our portfolio. Our future capital commitments are about HKD 8.6 billion over the next four years or so. Our leverage is likely to peak sometime around 2020, before we recognize the sales of our apartments in London. Just finally, if I'm to leave you with three key messages, it is that our earnings growth was broad based and across all regions and all divisions in which we operate. Our capital expenditure on our new projects will continue to increase. However, we're going to continue to actively manage spending on our existing assets.
Finally, we are in a strong financial position, not only to manage through this large capital expenditure program that we have forthcoming, but also to protect ourselves for any unforeseen events. Now I'd like to hand over to Mr. Peter Borer to talk about operations.
Thank you, Matthew. Good afternoon, ladies and gentlemen. During the year, The Peninsula Hong Kong was the market leader in average room rate, and we saw a strong improvement in RevPAR. The Peninsula Arcade was 87% occupied, and the leasing momentum was positive. The Peninsula Office Tower continues to perform well and was 97% occupied throughout 2018, and the immediate outlook is stable. The Peninsula Shanghai remains the market leader in average room rate in the city. The hotel reported a softer 2018 in terms of occupancy and RevPAR due to very intense competition and many new openings. The Peninsula Arcade was 89% occupied for the full year, and the recent leasing momentum has again been positive, with some exciting new couture brands opening shops in our arcade. The Peninsula Beijing RevPAR and occupancy showed positive growth year-on-year following the renovation.
We were the rate leader in our competitive set for 2018. The Peninsula Arcade has retained most of its top luxury tenants and has welcomed chic new luxury boutiques into the arcade. The Peninsula Tokyo 2018 operating results were positive. The best results, actually, since the hotel opened 10 years ago, with improved RevPAR positioning, average rates, and increased occupancy. We are optimistic for the coming year as visitor arrivals to Japan continue to be healthy in the run-up to the Rugby World Cup in 2019 and the Tokyo Olympics in 2020. The Peninsula Bangkok reported double-digit growth in RevPAR and improved occupancy following the end of the one-year mourning period for His Majesty King Bhumibol Adulyadej of Thailand.
In the second half of the year, Bangkok was affected by a sharp decline in Chinese mainland arrivals following a tragic boat accident in Phuket, which led to reduced group tourism to the entire country. The Peninsula Manila occupancy and RevPAR saw a healthy increase over the same period in 2017, there was a slight decline in average rates. The country's economy continues to be one of the fastest growing in Southeast Asia. The Peninsula New York reported an increase in revenue, average rates, and RevPAR over the previous year. Occupancy remained flat. Our food and beverage performance was soft, although Clement restaurant and the hotel's rooftop bar, Salon de Ning, performed well, and the latter is consistently rated as one of the best bars in New York.
The Peninsula Chicago reported a pleasing year with a double-digit increase in RevPAR, achieving RevPAR and average rate leader despite significant new supply in the city. Amidst intense competition, we were delighted to receive the accolade as the number one best luxury hotel in the U.S. by Tripadvisor, which is a testament to the popularity of the hotel following its extensive renovation in 2016. As Clement mentioned, we opened a beautiful new bar. The Peninsula Beverly Hills was once again voted best hotel in the U.S. by Global Traveler Magazine in 2018. The hotel reported softer rates and a decreased revenue over the previous year, with occupancy declining slightly. Leisure travel to Los Angeles and food and beverage revenue was negatively impacted by an unusually cold and rainy winter spell. In 2018, Paris saw a record tourist arrival and improving sentiment for the first half year.
The Gilets Jaunes protests unfortunately affected the city in the fourth quarter. This also impacted our operating results as some of the protests occurred in the very immediate vicinity of our hotel. We believe the situation has calmed and we're cautiously optimistic for the outlook of 2019. Overall, The Peninsula Paris reported improved results with a double-digit increase in RevPAR and improved revenue, occupancy, and rates despite intense competition from the other Palace hotels in the city. Now back to Clement.
Thank you, Peter. I'll quickly cover the other two divisions. Commercial properties. Of course, the largest property is one you know well, the Repulse Bay complex, where things are pretty steady. The luxury residential market is actually quite stable, and our occupancies are good. Actually, the outlook is pretty good at the moment. I think that's actually something I'm pleased about for Hong Kong generally to see that sort of trend. The Peak Tower, the retail was fully leased for most of the year, with revenue up by 3%, and the visitor numbers to the Sky Terrace were very healthy. They reached record levels compared to the previous year. Clubs and services. The most important businesses there are the Peak Tram, firstly, where revenue was up by 10%.
As I mentioned, the operating right has been extended to 2035, but that is subject to us undertaking the upgrade project of the Peak Tram. What we're essentially doing in that upgrade project, you've heard this before maybe, is that we will build a new platform at the lower station because the newer trams are too big for the existing station. The new trams will have a capacity of 210 passengers as compared to 120. We're using the existing station as queuing area, and it will be nicely done with queuing and entertainment and so on. From the old station, one would go up escalators into the new platform for the new tram. This will take the queuing away from Garden Road. All those big queues you see on Garden Road will be going inside the former station.
Of course, we have greater revenue opportunity with the larger tram cars. However, we will need to suspend service for two periods, one this year and one next year, in that construction. There will be some disruption to the existing Peak Tram business. Although, of course, as you would expect, we are making arrangements with other transport providers so that people will still get up to the Peak Tower and the Sky Terrace during that time. The first service suspension will be about two and a half months. We have not yet announced the exact date. Merchandising business, I talk about quite a lot because that is a growth business for us. Revenue is 9% higher than last year. As I mentioned, we're looking at our China expansion there. Actually, the Peninsula boutique at the airport does pretty well nowadays.
New hotel projects, you're familiar with these. London, 189 rooms, 26 residential apartments, construction budget, GBP 650 million. The main thing to explain here is that in many projects, what you do is you dig a big hole, you build the basements, then when you finish the basements, you build the superstructure. We're not doing that. We're doing what is called the top-down approach, which means that you build up and down at the same time. You build this great slab that you can take the weight and you build the superstructure and you go down at the same time. What that means is that we're actually going to top out middle of this year. Actually, if you go to London now, you can see the building coming up and large holdings already in place.
With the topping out, there's still a lot of work to be done in the basements because of the top-down. Although you will see the superstructure already in place, it will take a bit of time to finish it, and that's scheduled for 2021. Istanbul, again, you're familiar with this, 50%, HKD 300 million project cost for the entire joint venture, 180 rooms. Then it's got all these beautiful gardens and a swimming pool and so on the Bosphorus. Basically, it's not an easy project. You're building right on the shores of the Bosphorus. You're dealing with three heritage buildings, and sometimes you find things that you might not expect. We're having to deal with all of that. We have been improving our project management as well. The project keeps on progressing.
Completion, we're now targeting for 2021, which is later than the original expectation because of many of the heritage and construction issues we've come across. We're still within the budget that we had set. Peninsula Yangon. The project is about $130 million , 70% interest and 88 guest rooms. You're all familiar with this beautiful colonial building with the high ceilings. I'm not sure if people have seen this design drawing before, but you can see. Hopefully, it will be very beautifully done with this colonial feel. Unfortunately, during 2018, and I forgot whether this was before or after we announced the interim results, but a section of the heritage wall fell down. Some of the old laterite was not very strong and when it was raining very badly, part of it fell down. That has led to some delay, but we have reaffirmed the construction methodology.
We have gone back to the authorities to seek all of the approvals that we need. The project is coming back on track. We are dealing with an insurance claim that has not yet been finalized. Again, that one is scheduled, at the moment, for completion in 2021. You will notice that we have quite a lot being completed in 2021, which will be a lot of work for Peter. Sustainable luxury. I'm delighted to mention that our head of sustainability, Janice, was awarded the edie Sustainability Leader of the Year, which apparently is a big award to win in the sustainability world, to recognize her strategic approach to sustainability. All I would say is that we are well on track with our Vision 2020. 85% of the objectives that we set for ourselves have been met. We're working on the remainder.
I mentioned earlier the BREEAM award in Beijing. There are just a number of programs which are ongoing. In fact, one of the main things now is to think about what our vision's going to be beyond 2020. Of course, we want to extend and have a new vision once the existing vision has been more or less delivered. Outlook. I think we've talked about a lot of this already. We all know what the uncertainties are in the world that we're facing. Clearly, I was asked at the press conference what the impact is of the trade war. It's difficult to measure it because if someone hasn't booked, they won't necessarily tell you to say, "I would have booked if not for the trade war." We don't have precise numbers. Definitely, we clearly don't want a trade war.
We think our business would be better, of course, without. Nevertheless, our businesses are pretty stable at the moment, despite the environment that we're seeing. Hong Kong, we do think that generally more people coming to Hong Kong, more tourism is good for us, so things like the express rail and the bridge are good. In Japan, things like the Rugby World Cup and the Tokyo Olympics are good. Basically, we will continue to push Beijing following its renovation. We hope that Paris will calm down with the yellow vests. Further ahead, of course, we're looking forward to the openings of London , Istanbul, and Yangon. I mentioned already that both the retail shops lettings and residential lettings is not looking bad at the moment. We've already mentioned the Peak Tram, that there will be some earnings effect from some suspension there.
Overall, I think we're doing pretty well. Our financial position is strong. I think our management team are motivated and dedicated, in good spirits. I think things are going quite well for us. I'm obviously very appreciative of all the hard work and the contributions of my team.