Bleak residential property market drags Hong Kong Land’s profits in 1H

Jardine Strategic's underlying earnings down by 5%.

The absence of residential project completions in Singapore led to an overall decline in earnings for Jardine Strategic’s Hong Kong Land, the company revealed today.

Hongkong Land produced an underlying profit in the first half in line with expectations of US$433 million, compared with US$519 million in 2013. The contribution from its commercial property was higher, but the absence of residential project completions in Singapore led to an overall decline in earnings.

Jardine Strategic’s underlying earnings slipped by 5%, but its interim dividend was climbed 7%.

In an announcement, Jardine Strategic also stated that there was some evidence of increasing demand in the Singapore office leasing market, where the group’s office portfolio saw a steady performance and occupancy levels.

“The contribution from residential activities was significantly lower as no projects were completed in Singapore in the first half of 2014, compared with two large projects completed in the first six months of 2013. Positive sales activity did, however, allow US$34 million of writedowns previously made to be reversed. MCL Land expects to complete two projects in Singapore in the second half of the year, with additional completions due in 2015. In Hong
Kong, further sales at its Serenade project were completed,” the release noted.