Kerry Properties underlying income climbs to HK$5.4bBusiness | 17 Mar 2020 1:37 pm
Kerry Propoerties (0683) net profit for the year ended December 31, fell by 8 percent to HK$6.89 billion, from HK$7.49 billion in 2018.
The economic slowdown in mainland China and Hong Kong has weighed on the performance, Kerry Group said.
Underlying net profit, excluding change in the fair value of investment properties, grew by 61 percent to HK$5.4 billion in 2019.
Total revenue fell by 15.9 percent to HK$18.03 billion.
Earnings per share were HK$4.74, down by 8 percent compared with HK$5.16 per share in 2018.
Kerry Properties recommended a final dividend of HK$0.95 per share for 2019.
The group also said it recorded an increase in fair value of investment properties (net of deferred taxation) attributable to shareholders of HK$1.50 billion for 2019, from HK$4.15 billion the year before.
Before taking into account the increase in fair value, profit increased by 61 percent to HK$5.39 billion from HK$3.34 billion in 2018.
The increase was mainly due to the provision for impairment loss for property under development in Macau amounting to HK$1.17 billion in 2018 Kerry Properties said. It was also due to the recording of net drop in fair value on financial assets at fair value through profit or loss amounting to HK$1.46 billion in 2018, compared with an increase of HK$5 million in 2019.
In May 2018, the Macau Government declared expiry of the land lease of a project located at Lot C12 at Nam Van Lake, Macau. The full impairment provision for the project amounting to HK$1.17 billion was made in 2018, the company said.
The change in fair value on financial assets through profit or loss for the year ended December 31, 2018 includes the drop in fair value of HK$1.50 billion relating to the investment in Shanghai Krupp Stainless Co.
The Hong Kong property division booked revenue of HK$6.28 billion, down by 22.61 percent compared with HK$8.12 billion in 2018 and a gross profit of HK$3.33 billion, from HK$3.32 billion, the year before.
Revenue came mainly from sales of completed residential properties at Mantin Heights, The Bloomsway and Mont Rouge.
The rental performance of the portfolio of residential, commercial and office properties in Hong Kong was robust, Kerry Properties said. Revenue from completed investment properties in Hong Kong was HK$1.27 billion, from HK$1.16 billion in 2018. Gross profit was HK$999 million compared with HK$926 million in 2018.
Revenue from mainland properties fell by 12 percent to HK$11.74 billion, mainly due to an 18 percent sales drop.