Hong Kong developer Kerry Properties posts 34 per cent drop in core earnings

Profits from mainland projects surged while contribution from Hong Kong property sales weakened

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Kerry Properties’ Dragons Range development in Sha Tin saw a drop in sales bookings. Photo: Jonathan Wong

Published: 7:15pm, 22 Aug 2016Updated: 8:55am, 23 Aug 2016

Kerry Properties, a Hong Kong-listed developer with property investments in both Hong Kong and mainland China, said its underlying first-half earnings fell 34 per cent to HK$1.43 billion as property sales in Hong Kong declined.

Net profit after property revaluation gains for the six months ended June 30 was HK$2.04 billion, or HK$1.41 a share, a decrease of 27 per cent from the same period last year.

The developer said an increase in fair value of investment properties of HK$607 million for the six months was unchanged from the same period in 2015.

Directors declared an interim dividend of 30 HK cents per share for the first half, unchanged from the previous year.

The underlying profit is in line with an earnings forecast of HK$1.44 billion predicted by Bocom International.

“Earnings fell as Hong Kong property sales have been slow when compared with that of last year,” said Bocom property analyst Alfred Lau.

During the six month period Kerry’s Hong Kong property unit reported a turnover of HK$715 million compared with HK$1.74 billion for the same period in 2015. Gross profit fell 46.73 per cent year on year to HK$473 million, mainly due to a drop in sales bookings at Dragons Range, a residential project in Sha Tin, in the first half.