CKI eager to enter new industries as profit grows

PUBLISHED : Friday, 26 July, 2013, 12:00am
UPDATED : Friday, 26 July, 2013, 3:51am


Cheung Kong Infrastructure says it is still on the prowl for investment opportunities, including those in new industries, as it reported 10.3 per cent growth in interim profit yesterday.

The infrastructure firm, ultimately controlled by Li Ka-shing, made two big acquisitions in the year's first half worth a combined HK$6.6 billion, including its first major waste management project and its first investment in continental Europe.

It paid HK$3.2 billion for waste management firm EnviroWaste in New Zealand and HK$3.4 billion for a 35 per cent stake in AVR, the largest producer in the Netherlands of electricity by burning waste.

"It is the group's plan to continue to grow the business in our portfolio and expand our investments globally and in new industry sectors," chairman Victor Li Tzar-kuoi said in a statement.

CKI posted a net profit of HK$5.17 billion for the year's first six months, up from HK$4.69 billion in the year-earlier period. Turnover, including that of entities jointly controlled with partners, rose 7.8 per cent to HK$3.02 billion.

Net profit of its infrastructure operations in Britain rose 5.2 per cent to HK$2.86 billion, contributing just over half of CKI's net earnings.

UK Power Networks, an electricity distributor in London and southeast England, CKI's largest overseas investment, posted 4 per cent growth in profit to HK$1.81 billion. Northumbrian Water, a water and sewerage services provider, and Northern Gas Networks, a natural gas provider in northern England, posted lower profits.

CKI's second-largest profit contributor is 38.9 per cent-owned Power Assets, the sole electricity supplier to Hong Kong Island and Lamma Island.

Power Assets posted a 10.2 per cent rise in net profit to HK$1.84 billion. About 63 per cent came from its British operations, some jointly owned with CKI.

Net profit at CKI's Australian operations edged up 1 per cent to HK$587 million. CKI and Power Assets have a continuing dispute with the Australian tax authorities.

CKI's profit from the mainland fell 14.2 per cent to HK$205 million owing to lower traffic and expiry of tax concessions at toll roads it invested in.

Profit from Canada and New Zealand fell 6.1 per cent to HK$77 million owing to higher costs in Canada.

The board declared an interim dividend of 50 HK cents per share, up 25 per cent from 40 HK cents in last year's first half.