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SCMP Reporter

WING On Co International has reported a 26.7 per cent profit rise to $151.52 million for the six months ended June 30, compared with the previous corresponding period.

  Wing On chairman Angela Chan said: ''Our department store operations continued to be affected by high rental and staff costs and a generally soft consumer market.''   Rental income from the group's investment properties rose moderately due to improved occupancy, she said, adding that profit from the group's share investment and trading activities also rose.

  The Bermuda-based group performed satisfactorily despite the sluggish growth in the US market and recorded an after-tax profit of about $6.2 million, Ms Chan said.

  Operating profit rose 1.09 per cent to $155.82 million.

    Turnover rose 9.21 per cent to $1.37 billion.

    Earnings per share rose to 44.1 cents from 40.4 cents.

  The consolidated profit after tax and minority interests, but before extraordinary items, amounted to about $103.5 million, representing a rise of about 9.2 per cent from the first half of 1992.

  ''We have also recorded an extraordinary profit of approximately $21 million from the disposal of the group's shareholdings in the Wing On Bank,'' Ms Chan said.

  She said property rental income was expected to be steady in the second half of the year.

  ''Based on the retailing patterns of past years, the department store business should improve during the second half of 1993.''   The returns on the group's investment in the United States, she said, depended on the pace of the economy's development.

  The group has an equity interest of 53.19 per cent in the Dah Chong Hong Trading Corp group in the US.

  Neither the company nor its subsidiaries bought, sold or redeemed any of the company's listed shares during the six months.

  Wing On International Holdings and its private controlling shareholder Wing On Co recently announced a $300 million plan to redevelop the Hotel Fortuna on Nathan Road, Yau Ma Tei, into offices and shops.

  The two companies said they would combine two sites with a total area of 25,504 square feet, evict the tenants by next May 31 and build a 331,000 sq ft office and shopping complex by 1996.

  Wing On International owns 8,271 sq ft of the site while Wing On Co owns 17,233 sq ft.

  A new Wing On store is to take up 80,000 sq ft of the development.

  The company's directors planned the office development to take advantage of the scarce new office space planned for the Nathan Road area during the next few years.

  Analysts said that although more hotels would be needed soon, there was a more urgent need for good office space.

  They said: ''The economics are strongly in favour of building more offices and it is going to continue.''       It also took more management time to run a hotel and the industry's cyclical nature brought added risk, they said.

  In the past two years, developers have knocked down at least four of the territory's hotels - the Empress, the Grand, the Lee Gardens and the Ambassador.



Wing On held back by soft sales market