Shun Tak Holdings

Property sales boost Shun Tak net 52.7pc to beat market target

PUBLISHED : Wednesday, 09 April, 2008, 12:00am
UPDATED : Wednesday, 09 April, 2008, 12:00am

Shun Tak Holdings posted forecast-beating annual earnings for last year as a result of better property sales.

Net profit jumped 52.7 per cent to HK$1.01 billion from HK$663.9 million in the previous year. That topped the average forecast of HK$926.3 million by 11 analysts polled by Thomson Financial.

Turnover rose 32.3 per cent to HK$3.32 billion, compared with HK$2.51 billion in the previous year.

Operating profit from property sales jumped 241.5 per cent to HK$286.9 million from HK$84 million, mainly driven by the sales of luxury homes in Nova City 2 in Macau and the Radcliffe in Hong Kong.

Shun Tak raised its stake in Nova Taipa Gardens and Nova City, both in Macau, to 100 per cent from 25 per cent, boosting its profit from the sale of the projects.

At the end of last year, 60 per cent of the units in Radcliffe were sold while more than 98 per cent of units in Nova City 2 had secured buyers. Its ferry unit benefited from a 15 per cent increase in passenger volume to more than 14 million people, boosting the transport division's operating profit by 9.5 per cent to HK$259.2 million.

However, investment income, mainly dividends from 11.5 per cent-owned Sociedade de Turismo e Diversoes de Macau (STDM), dropped 23.3 per cent to HK$92.64 million from HK$120.73 million in 2006.

Dividends from STDM, which owns 80 per cent of casino licence holder Sociedade de Jogos de Macau, was HK$61 million, down 43.8 per cent on the year.

'Shun Tak will show moderate earnings growth this year as I don't see a catalyst,' said Sun Hung Kai Financial strategist Castor Pang. 'There are few property units left behind for sale to boost earnings.'

Nova City 3 is scheduled for completion this year, and more than 87 per cent of the units were sold by the end of last year.

Meanwhile, One Central Residences, a joint venture with Hongkong Land Holdings due for completion next year, is 97 per cent sold.

The company declared a final dividend of 7 HK cents per share, down from 8 HK cents in 2006.

Shares of Shun Tak fell 1.29 per cent to close yesterday at HK$10.70 before the results announcement.