Wharf (Holdings) is starting to see a return on its investment in the mainland property market, posting a 44.3 per cent jump in underlying interim earnings. Excluding a HK$4.48 billion revaluation gain on its investment properties, underlying profit in the first half was HK$3.29 billion, up from HK$2.28 billion a year ago. Revenue rose 7.63 per cent to HK$8.61 billion. If the gain from property revaluations is included, net profit in the period would be HK$6.98 billion, down 16.81 per cent from HK$8.39 billion the same time last year when it recorded a HK$6.57 billion property revaluation gain. The larger area of projects sold before and completed in the period helped boost overall profit. The company realised sales of 1.85 million square feet gross floor area of projects in the first half, mainly from the Chengdu Times Residences and Dalian Times No 8. That was a jump from 400,000 sqft a year ago. Property development contributed HK$626 million in profit before tax, compared with a HK$34 million loss before tax a year ago. The firm sold 2.2 million sqft with a total value of 1.8 billion yuan (HK$2.04 billion) in the period, accounting for 50 per cent of its annual sales target. Stephen Ng Tin-hoi, the deputy chairman and managing director, expected profit from property sales to be higher in the second half as the market improves. 'Every project we have sold has been profitable so far, even the Danzishi project in Chongqing,' Mr Ng said. Wharf bought the Danzishi plot with China Overseas Land and Investment for a record 7.5 billion yuan in 2007. Analysts say the 22.59 million sqft project could be loss-making because of the land's high cost. The company booked 10.33 per cent growth in operating profit from property investment to HK$2.99 billion. Its offices in Harbour City and Times Square recorded 20 to 30 per cent increases on rental contract renewals, but it expects declines on contracts due for renewal in the second half because of competition from Kowloon East. Operating profit from the logistics division dropped 24.85 per cent to HK$626 million. The company kept its interim dividend at 36 HK cents. Meanwhile, parent Wheelock said interim underlying net profit rose 47 per cent to HK$1.75 billion. Including property revaluation gains, net profit fell 20.7 per cent. Revenue dropped 26 per cent to HK$9.08 billion. It declared an interim dividend of 2.5 HK cents, the same as last year.