Wheelock core interim profit rise 40 per cent to HK$4.76 billion

Developer's underlying gains climb 40 per cent in first half but net income and revenue weaken

PUBLISHED : Thursday, 29 August, 2013, 1:49pm
UPDATED : Friday, 30 August, 2013, 1:55am

Property and logistics conglomerate Wheelock and Co said its core profit, excluding property revaluations and exceptional items, rose 40 per cent to HK$4.76 billion in the first half of the year.

The result was mainly helped by profit from property sales, and rental revenue growth at 52 per cent-owned subsidiary Wharf.

On Tuesday, Wharf reported 5 per cent higher core profit of HK$5.68 billion for the first half.

Wheelock said yesterday attributable profit, including property revaluations, dropped 20.1 per cent to HK$10.85 billion while revenue fell 11.76 per cent to HK$17.4 billion, mainly because of lower property sales.

A one-off sale included the disposal of shares in Singapore luxury developer SC Global Developments.

Operating profit was 20 per cent lower at HK$7.3 billion, compared with HK$9.1 billion previously.

Despite a decline in bottom-line profit, the company announced interim dividend would be increased by 40 per cent to 35 HK cents per share.

BNP Paribas property analyst Patrick Wong Chi-leung said Wheelock had been actively acquiring land in the past year and that its outlook would largely depend on the performance of the residential market.

Wong said he expected the developer would find it more difficult to dispose of its luxury properties.

Wheelock is one of the two dominant landowners in Tseung Kwan O South, owning four sites that together offer 2.3 million square feet of gross floor area for development into more than 2,500 residential units.

Its Mount Nicholson site on the Peak, which was acquired for HK$10.4 billion through a 50-50 joint venture with Nan Fung group, will be developed into luxury residences with a gross floor area of 324,000 sq ft. Pre-sales were scheduled for next year.

The company said its major commitments to future capital and development expenditure were estimated at HK$109.7 billion as of June, of which HK$34.4 billion was authorised and contracted for.

Attributable committed land costs of HK$9.9 billion were payable this year, it said.

Net debt increased HK$9 billion in the first half to HK$82.2 billion. The ratio of net debt to total equity was 27.5 per cent, compared with 25.6 per cent in the same period last year.

Wheelock's shares rose 0.38 per cent to close at HK$39.25 yesterday.