Wharf slips into the red by $3.2b

Staff reporter

Wharf (0004) reported a net loss of HK$3.22 billion last year, reversing a profit of HK$945 million in 2023, due to lower revenue recognition and higher impairment provisions for development properties in mainland China.

The company declared a second interim dividend of 20 HK cents, bringing the total dividend for the year to 40 HK cents, unchanged from 2023.

Its shares once tumbled nearly 9 percent to HK$18.56 after its earnings release on Thursday and later trimmed losses to close 4.67 percent lower at HK$19.4.

Notably, Modern Terminals' Hong Kong throughput fell by 6 percent to 3.5 million twenty-foot equivalent units amid intense regional competition, while two ports in Shenzen posted an increase.

Chairman and managing director Stephen Ng Tin-hoi said Hong Kong's shipping industry would be a loser as some global shippers started restructuring in February.

Ng estimated that the throughput of Hong Kong's marine ports this year might not be able to maintain the figure in 2024, as the gap of trading with Western countries is still not fully filled by the shipments to destinations outside the region for the time being.

The underlying net profit fell 21.5 percent year-on-year to HK$2.8 billion. Impairment provisions for mainland China development properties rose to HK$2.02 billion, up from HK$1.86 billion a year earlier.

Revenue fell 36.1 percent year-on-year to HK$12.1 billion, among which the Hong Kong property business saw a 71 percent decline to HK$322 million.

The sagging economy and property market diminished consumer wealth, leading shoppers to prioritize value, the company said in a filing with the stock exchange.

Looking ahead, the company expects that the effect of large-scale fiscal support measures is awaiting materialization to ease the property sector's debt burden in the mainland, while rebuilding consumer confidence remains a challenge.

In Hong Kong, the company said improving economic conditions is key to property market recovery.