Global trading company Li & Fung says continuing gloom in the global economy dented its core earnings in the first half of the year.
Nevertheless, the company said its net profit jumped 33 per cent - buoyed by a writedown of acquisition costs.
The company plans to make more acquisitions by the end of the year to achieve its three-year target of US$1.5 billion in core operating profit by 2013, said William Fung Kwok-lun, the chairman of Li & Fung, yesterday.
He said the company could finance acquisitions of up to US$1 billion at present, given that it has US$300 million cash on hand.
The trading company for global consumer brands such as Procter & Gamble and Kimberly-Clark reported US$312 million in net profit in the first six months to June, up from US$236 million a year earlier, boosted by a writedown on the costs of previous acquisitions.
The writedown came after some of the acquisitions failed to generate as much income as expected. When it acquires a company, Li & Fung pays a down payment of one third of the consideration, and the remainder of the price is subject to earnings reaching a certain level.