Hongkong Electric Holdings expects an even larger contribution from its overseas portfolio this year after it provided a much-needed cushion to tumbling profitability on its home turf last year.
The utility, ultimately held by Li Ka-shing, said yesterday net profit fell 17 per cent to HK$6.69 billion last year, or HK$3.14 per share, on turnover of HK$10.39 billion, which was down 18.63 per cent. However, the decline was less severe than analysts' forecasts.
The combined electricity generation and distribution assets on the mainland, in Australia, Britain, Canada and New Zealand doubled earnings to HK$2.05 billion last year from HK$1.02 billion previously, driven by strong economic recovery in Guangdong in the second half of the year.
This helped offset a 31 per cent drop in profit to HK$4.61 billion from its core electricity supply on Hong Kong and Lamma islands when the new scheme of control agreement took effect and pared the return on the fixed net assets of the city's two power utilities to 9.99 per cent from 13.5-15 per cent.
Hongkong Electric, which has its core earnings tied to expenditure on power assets, spent HK$2.75 billion last year - 32 per cent more than in 2008 - largely on installing desulphurisation facilities at its Lamma plant.
A company spokeswoman said China and Australia were the biggest overseas contributors, each accounting for 30 per cent of the group's HK$2.05 billion offshore earnings.
She said three newly acquired power plants performed better than expected due to a rebound in manufacturing activities in Guangdong and stable coal prices.