Shun Tak Holdings

Shun Tak interim net profit falls 33pc to HK$672m as revaluation gains drop

Revaluation gains drop to HK$508m from HK$907m in same period last year

PUBLISHED : Wednesday, 21 August, 2013, 3:07pm
UPDATED : Thursday, 22 August, 2013, 2:13am

Shun Tak said its first-half net profit fell 33 per cent year on year to HK$672 million but that Macau and Hong Kong property would boost earnings in the second half.

The property, transport and investment flagship of gambling mogul Stanley Ho Hung-sun said in a filing yesterday that 99 per cent of the flats in One Central - a residential complex in Macau it jointly developed with Hongkong Land - were sold in the six-month period.

Excluding revaluation gains - HK$508 million in the period, compared with HK$907 in the first half of last year - first-half underlying profit rose 69 per cent to HK$164 million.

An interim dividend will not be paid.

Chatham Gate, a residential project in Hong Kong in which Shun Tak holds a 51 per cent stake, is expected to contribute to the firm's second-half earnings when the 237 flats sold there are handed over to their buyers.

Looking ahead, the Nova City development in Macau and two projects in Beijing - an office facility and phase two of a retail-hotel complex - should continue to support the firm's earnings over the next two years.

Shun Tak won the bidding for a 256,000 square foot site in Shenzhen's Hengqin new economic zone last month. It plans to build a hotel and office complex there.

The firm, which raised US$400 million in March through the issuance of seven-year, 5.7 per cent guaranteed notes, has HK$8.85 billion in cash and is expected to make acquisitions.

On the transport front, Shun Tak said it had completed its goal of building an air-sea-land network by investing in budget airline Jetstar Hong Kong. Jetstar is still waiting for official authorisation to be a Hong Kong-based carrier.

"With the successful track record of Jetstar in other Asian bases, and the profound aviation experience and extensive networks of Qantas Group and China Eastern Airlines, this new low-cost airline is expected to drive substantial travel demand within the Hong Kong market," Shun Tak said.

Shun Tak's share prices fell 1.59 per cent yesterday. The Hang Seng Index slid 0.69 per cent.