Li confident on developer's path

Cheung Kong (Holdings), controlled by billionaire Li Ka-shing, says it will continue to pursue quality investments in Hong Kong and abroad. It reported a 30 per cent fall in first-half profit, excluding the contribution from Hutchison Whampoa.

"With a low debt ratio, the Cheung Kong group is well placed to make steady progress in a constantly challenging market," Li, the company's chairman, said in the results announcement. Its net debt was about 5.6 per cent.

Before Hutchison's contribution, the group's profit was HK$7.21 billion for the six months to June, down from HK$10.35 billion a year ago. Earnings were hurt by the government's property curbs.

"The property division was below market expectations as no major property projects were booked in the first half," said Adrian Ngan, Citic Securities' executive director of property equities research.

Hit by the depressed housing market and the cancellation of the controversial sale of HK$1.4 billion of hotel units at its Apex Horizon project in Kwai Chung, profit from property sales - including its share from joint ventures - fell 36.58 per cent to HK$3.83 billion in the first half, from HK$6.04 billion a year earlier. The sale of Apex Horizon was dropped in May after the Securities and Futures Commission found the deals breached the law as unauthorised investments.

However, rental income jumped 8.24 per cent to HK$1.06 billion during the period,

Analysts said deputy chairman Victor Li Tzar-kuoi, who chaired an analyst briefing, did not directly answer questions about whether the developer managed to meet this year sales target of up to HK$40 billion.