Hongkong Land Holdings' underlying profit up 4% to $1.49b in 2019

Contributions from the development properties in mainland China drove higher profits.

Hongkong Land Holdings’ underlying profit attributable to shareholders grew 4% to $1.49b in 2019, from $1.44b in 2018, according to its financial results. Net profit attributable to shareholders, meanwhile, plunged 92% to $198m in 2019, from $2,457 in 2018.

A higher contribution from the firm’s development properties business in mainland China drove the underlying profit’s increase, partially offset by lower contributions from other markets.

The firm incurred net losses of $1.22b, primarily from lower valuations of the firm’s investment properties, which in turn slumped the net profit attributable to shareholders

The central retail portfolio’s average retail rent fell to $39.57 (HK $222) per sqft in 2019, from $41.53 (HK $233) per sqft in 2018, due to the temporary rental relief and a decline in turnover rent.

In Singapore, vacancy in the firm’s office portfolio was at 5% by end of 2019, compared with 2.5% at the end of 2018. Rental reversions were said to be positive, with average rents increasing to $9.7 per sqft in 2019 from $9.2 per sqft in 2018.

The development properties portfolio, on the other hand, saw higher sales completions, which led to an increase in profit contribution. The firm’s attributable interest in contracted sales was 18% higher for the year at $332.98m.

Meanwhile for sold but unrecognised contracted sales, the attributable interest registered at $331.56m, compared with $242.07m at the end of 2018.

In Singapore, recognised profits in 2019 were lower than the prior year. Pre-sales at the 309-unit Margaret Ville and the 1,404 unit Parc Esta projects were said to be within expectations, with construction of both projects scheduled to be completed by 2021.

In February 2020, the firm acquired a prime, predominantly commercial site along the Huangpu River in the Xuhui District of Shanghai. The asset mainly comprises office and retail space, with a developable area of 1.1 million sqm, and will be developed in multiple phases to 2027.

The firm’s directors recommend a final dividend of $2.85 cents (US¢16.00) per share, providing a total dividend of $3.92 cents (US¢22.00) per share for the year, unchanged from last year.