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Sandy Li

Property developer Hing Kong Holdings plunged into the red after a $495.19 million exceptional loss due largely to the fall in value of its investment in Wah Tak Fung Holdings.

 The company made an attributable loss of $480.71 million last year, against a profit of $116.17 million in 1997.

 Hing Kong said the provisions included $330.8 million for the fall in value of its investment in Wah Tak Fung plus its intended debt-restructuring exercise.

 The company was recorded as holding a 20 per cent stake in Wah Tak Fung as of June last year. Wah Tak Fung is selling properties to reduce debts to less than $1 billion.

 Hing Kong also booked a loss and provision of $164.39 million on its partial disposal of a joint-venture property development and for the fall in value of its remaining interest in the project.

 Analysts believed this was related to its 30 per cent interest in the luxury residential project Tycoon Place, in Tai Po, which it bought at the market's peak in 1997.

 Hing Kong said it would release its share of 13 houses at Tycoon Place for sale later in the year.

 No dividend was recommended against 2.5 cents a year ago. Turnover fell 35 per cent to $296.93 million.

 The loss per share was 43.9 cents against earnings per share of 12.2 cents previously.

 Chairman Zhu Yuening expected group performance and results would 'improve significantly' in the next few years owing to signs of recovery in the property market and development sites bought last year at good prices.

 He said contribution from its infrastructure investment in the mainland, the Wuhu power plant, for this year would probably be reduced due to the expiry of a fixed-income agreement last year.

 The pay-back period for its 307 Toll Road in Cangzhou could be a little longer than expected despite profit generated in the first few months of operation, he said.



Provision attacks profit at Hing Kong