(HONG KONG) Hang Lung Properties Ltd, the best performer in the Hang Seng Property Index this year, said full-year profit excluding gains from revaluations more than doubled after it sold more apartments in Hong Kong.
Net income excluding revaluation gains and deferred tax rose to HK$6.67 billion (S$1.2 billion) in the 12 months to June 30 from HK$2.39 billion a year earlier, the developer said in a statement to the Hong Kong stock exchange yesterday. That fell short of the average estimate of HK$6.96 billion from 12 analysts surveyed by Bloomberg.
Hong Kong's third-biggest developer by market value said full-year property sales jumped after it sold more luxury apartments at its HarbourSide project. Hong Kong home prices have risen 38 per cent since early 2009, fuelled by record-low mortgage costs, near-zero interest rates on savings deposits and buying by rich mainland Chinese.
Luxury home prices in the city may rise 10 per cent by the end of this year after already gaining 10 per cent in the first half, property consultant Jones Lang LaSalle Inc said last week.
'I'm optimistic about Hong Kong's luxury market in the long run,' Hang Lung chairman Ronnie Chan said at a press briefing yesterday.
The company sold 425 garden-view units at the HarbourSide development in West Kowloon and recorded profit from property sales of HK$5.26 billion, compared with HK$3 million a year earlier.
The shares fell 3.1 per cent to HK$32.60 at the 4pm close in Hong Kong, while the Hang Seng Property Index lost one per cent. The stock is up 6.5 per cent this year compared with a 3.6 per cent decline in the seven-member property index.
Hang Lung, which has two office and shopping mall complexes in Shanghai and one in Shenyang and is building several others in cities such as Wuxi and Jinan, said projects in China are progressing 'well'.
Rental profit from mainland China rose 14 per cent to HK$1.6 billion, it said.
The developer is seeking to buy more prime sites in China, according to yesterday's statement.
'We'll stay focused on mainland China's high-end commercial leasing properties, and focus primarily on second-tier cities, which generate returns as good as the first-tier cities,' Mr Chan said. 'China's system is flooded with money.'
Rental profit from its Hong Kong investment properties was little changed at HK$2.1 billion. Hang Lung owns the Hong Kong headquarters of Standard Chartered plc.
Hang Lung also booked a HK$21.2 billion gain reflecting the increased value of real estate held for investment, against a HK$3.5 billion gain the same period the previous year.
Including those gains, net income for the year surged more than 400 per cent to HK$22.3 billion, or HK$5.30 a share, from HK$4.13 billion, or 99 Hong Kong cents a share, a year earlier.
The company is the first of the city's biggest builders to announce earnings. Cheung Kong (Holdings) Ltd, Hong Kong's second-biggest developer controlled by billionaire Li Ka-shing, will report on Aug 5. Sun Hung Kai Properties Ltd, the city's biggest developer, and Sino Land Co will likely report next month.
Hang Lung will pay a final dividend of 54 Hong Kong cents, from 51 cents last year. -- Bloomberg
Source: Business Times, 29 Jul 2010
Post a Comment