Govt refund for Hong Kong terminals props up HPH Trust Q1 earnings

A SIZEABLE government refund helped Hutchison Port Holdings (HPH) Trust nearly double its earnings for the first quarter despite a slide in revenue.

Net profit for the three months ended March 31 jumped 94.2 per cent from the previous year to HK$554.9 million (S$97 million), the trust said in a Singapore Exchange filing on Monday after the market closed.

This was even though revenue dropped 6.7 per cent year-on-year to HK$2.75 billion.

The container throughput of one of the trust's key assets, Hongkong International Terminals (HIT) - specifically terminals 4, 6, 7 plus two berths in Terminal 9 at Kwai Tsing in Hong Kong - fell 12.1 per cent in the quarter from the preceding year mainly due to weaker intra-Asia and transshipment cargoes, HPH Trust said.

But the trust's bottomline got a boost after other operating expenses for Q1 recorded a net income of HK$242.3 million. This was because HIT received a government rent and rates refund of HK$430 million during the quarter, the trust noted.

It added in its statement that HIT got the refund "after reaching agreement on the final rateable value of certain leased properties for the past years".

Earnings per unit for Q1 were 6.37 HK cents, up from 3.28 HK cents the previous year. Net asset value per unit was HK$4.76 as at March 31, 2016, down from HK$4.89 as at Dec 31, 2015.

HPH Trust units finished flat at S$0.675 on Monday before the announcement.