Hang Lung Properties’ profit sinks 56% amid Hong Kong, mainland China slowdown
- First-half net profit declines to HK$1.06 billion (US$135.7 million), from HK$2.39 billion a year earlier on lower rental revenues, higher costs
The shares sank as much as 15.2 per cent, the most in 24 years, before erasing some losses to close 11.7 per cent lower at HK$5.42. The stock has lost more than 85 per cent since reaching a record high of HK$40.30 in November 2020.
Net profit attributable to shareholders came in at HK$1.06 billion (US$135.7 million) in the six months to June, which included a net revaluation loss on properties attributable to shareholders, according to the company’s earnings statement to the Hong Kong stock exchange on Tuesday. The net profit a year earlier stood at HK$2.39 billion.
“Now is the time to adopt a more cautious approach, rather than focus on expansion,” Adriel Chan, chairman of Hang Lung Properties told a media briefing. “It is necessary to take responsible steps to preserve cash reserves and maintain a healthy financial position, while supporting the capital requirements of our projects under development.”
The company’s net gearing ratio stood at 32.9 per cent in June, up 1 per cent compared with the end of last year. The developer hopes to maintain the level in the mid-thirties in the short terms and reduce it to 30 per cent or below in the long-term.
Hang Lung Properties will pay an interim dividend of HK$0.12 per share, 33 per cent less than a year earlier.
