Swire Pacific posts record sales and 80 per cent jump in 2018 profit, marking a successful handover of reins to family scion

Swire Pacific’s 2018 profit was helped by a turnaround in the financial performance of Cathay Pacific Airways and disposals of non-core assets

Merlin Swire, the sixth-generation descendant of the group’s founder, took over as chairman last July

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A new aluminium cans production line of Swire Coca-Cola Hong Kong. Swire Pacific, one of the world’s largest Coca Cola bottlers, produces as many as 60 beverage brands in total, selling them to a franchise population of 727 million people. Photo: Handout

Published: 1:14pm, 14 Mar 2019Updated: 12:13am, 15 Mar 2019

Swire Pacific Limited, the publicly listed arm of one of Asia’s largest conglomerates, reported a year of record sales and the highest profit in three years, marking a successful handover of the two century-old company to the founder’s sixth-generation scion.

The company’s underlying profit, excluding revaluation gains on investment properties, soared to HK$8.52 billion (US$1.08 billion) last year, beating the HK$6.84 billion consensus in a Bloomberg poll of four analysts, setting the highest level since 2015. Sales by the company, one of the world’s biggest bottlers for Coca-Cola, rose 5 per cent to a record HK$84.6 billion.

The group, which traces its history to Hong Kong in 1816, was helped by a turnaround in the financial performance of Cathay Pacific Airways, which returned to profitability after two straight years of losses. Swire also made gains from selling non-core assets, including a Kowloon office building for HK$6.5 billion, and two Quarry Bay office towers for HK$15 billion.

Last year was “a very unusual year for us in terms of selling down non- core mature assets,” Swire Pacific’s chairman Merlin Swire said in Hong Kong, his first press conference since taking over the helm last July. “That programme is largely completed now. You shouldn’t expect any [more asset sales of] that pace in 2019.”

Swire Pacific’s chairman Merlin Swire (R) and Swire Properties’ chief executive Guy Bradley (L) during a press conference to announce their companies’ 2018 financial results at the Island Shangri-La Hotel in Admiralty on 14 March 2019. Photo: SCMP/KY Cheng

Swire Pacific, whose businesses include aviation, real estate, offshore marine services, said it would pay a final dividend of HK$1.8 per share, up from HK$1.1 per share in 2017.

Profit attributable from its 45 per cent owned Cathay Pacific was HK$1.06 billion, compared with a 2017 loss of HK$567 million, Swire Pacific said. On Wednesday, Cathay Pacific reported HK$2.3 billion in annual profit last year, reversing from a 2017 loss of HK$1.25 billion.