SUN Hung Kai and Co has disappointed investors by reporting a net profit for last year well below expectations at $310.03 million, up 50 per cent. Brokers had been expecting net profit to rise between 79 per cent and 87.7 per cent to between $370 million and $388 million. Their estimates were based on a strong performance by the brokerage during the six months to June 30 last year, when turnover was up 52.58 per cent to $463.61 million, operating profit rose 106.54 per cent to $222.72 million, and net profit before extraordinaries increased 120.13 per cent to $201.19 million. Analysts following the company are concerned by the lack of any explanation for the under-performance after the strong first half. They are guessing that the brokerage had problems with foreign exchange dealing in the second half of the year. Analysts are also concerned about the fall in the company's share price ahead of the release of the results during the morning session. The shares had made major gains - in the face of a falling Hang Seng Index - over the previous days. Brokerage chairman and managing director Tony Fung Wing-cheung said in a prepared results statement: ''Marked progress and encouraging results with all our business divisions have led to significantly increased operating earnings for the group for the second consecutive year.'' Earnings per share were up 47.8 per cent to 50.4 cents and the final dividend was 20 cents, taking the total for the year to 30 cents. An extraordinary $14.9 million gain was made on the disposal of subsidiaries. Mr Fung said: ''The continuing rapid growth in the Asia-Pacific region, fuelled by intensified intra-regional trade, will continue to present new avenues of expansion for the group's core financial business.'' Brokers believe a disappointing performance by the foreign exchange division might be to blame for the worse-than-expected results. Mr Fung said: ''The volume of the group's foreign exchange business remained high in the first half of the year but dropped significantly in the second half as the market awaited the outcome of the United States presidential election towards the end of the year.'' Brokers' concerns are based in the fact that interim turnover accounted for 62.66 per cent of the year's total. Operating profit at the interim stage made up 72.6 per cent of the full-year result and interim net profit was 64.9 per cent of the full-year profit. Brokers looked to the group accounting policy, stated in the last annual report, for an explanation of the lower-than-anticipated turnover figure, which led to the depressed operating profit. The group notes to the accounts stated: ''Turnover includes gross interest and dividend income; net brokerage, commission, rental and service income; and the following stated net of losses: profit from trading securities, income from bullion transactionsand differences on foreign exchange transactions.'' Given the buoyant stock market and the minor role bullion has in the accounts, brokers are guessing that losses in foreign exchange in the second half depressed the turnover and operating profit. Profits from associated companies rose 120.99 per cent to $67.19 million. The Sun Hung Kai's result is in sharp contrast to that of Peregrine Investment, whose net profit rose 101 per cent to $607.8 million on the back of the buoyant stock market and fees for advising on transactions.