CKI records 15pc growth in profit
Cheung Kong Infrastructure Holdings said profit before exceptional items rose 15 per cent to HK$4.77 billion last year on slower growth in its mainland portfolio but suggested it was hunting for acquisitions.
CKI took a one-off gain of HK$815 million on the sale of a toll-road stake in Guangzhou and a HK$623 million provision for its interest in the Lane Cove toll tunnel in Sydney.
A Thomson First Call poll showed a consensus for net profit of HK$5 billion on expectations of a 29.97 per cent increase.
CKI managing director Kam Hing-lam said yesterday that profit from the mainland portfolio - largely power plants in Zhuhai and Jilin and toll roads in Hebei and Henan - grew about 9.5 per cent to HK$766 million last year. This lagged behind double-digit growth in the past few years.
The sale of the group's interest in the East-South-West Ring Road in Guangzhou eliminated recurring income, although it yielded a substantial one-off gain, he said. Analysts said high coal prices weighed on CKI's mainland power plants.
However, CKI's bread and butter, electricity supplier Hongkong Electric Holdings, reported an 8.74 per cent rise in profit to HK$2.86 billion.
With a war chest of HK$8.2 billion, CKI chairman Victor Li Tzar-kuoi said acquisitions were high on the agenda for future growth.
Morgan Stanley analyst Simon Lee expected CKI would invest about eight billion yuan (HK$8.78 billion) in expanding the Zhuhai power plant with two 1,000-megawatt generation units.
'It is active on the bidding grounds of Australia, New Zealand and Singapore,' Mr Lee said, adding CKI was interested in power plants in Singapore and electricity transmission and distribution assets in Australia and New Zealand.
Future growth looks challenging. Hongkong Electric's post-2008 profit margin on fixed-asset regulated power operations will be cut to 9.99 per cent from 15 per cent.
CKI's final dividend rose 10.66 per cent to 83 HK cents per share.