Hongkong Land posts 11% rise in H1 underlying profit to US$259 million

[SINGAPORE] Hongkong Land recorded an underlying profit of US$259 million for the six months ended Jun 30, up 11 per cent from US$233 million in the corresponding year-ago period. 

In a bourse filing on Tuesday (Jul 28), its CEO Michael Smith attributed this to lower net financing charges from active capital recycling.

The board is recommending an interim dividend of US$0.08 per share, an increase from US$0.06 in the same period last year.

Revenue for the first half was US$632.7 million, down 15.8 per cent year on year from US$751.2 million, as the group winds down its build-to-sell business.

As at Jun 30 2026, the valuation of the group’s portfolio of investment properties had risen by 3 per cent from Dec 31 2025, primarily due to “higher office open market rents and retail cap rate compression at its prime portfolio in Hong Kong”, said Hongkong Land.

Profit attributable to shareholders for the period rose to US$1.3 billion, from US$221 million in H1 FY2025.

Underlying earnings per share for H1 2026 stood at US$0.1207, up from US$0.1058 in H1 2025.

The group uses underlying profit in its internal financial reporting to distinguish between ongoing business performance and non-trading items, as its management considers this to be a key measure that provides additional information on the group’s underlying business performance. 

Vacancies in the group’s Hong Kong Central office portfolio declined from 11 per cent at the end of December 2025 to 9.2 per cent by the end of June 2026.

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Hongkong Land noted that its portfolio “continues to outperform the market”, with committed occupancy standing at 94.2 per cent.  

In Singapore, the group’s office portfolio “continued to perform strongly”, Hongkong Land said. Rental reversions were positive, with average rents increasing to S$11.90 per square foot (psf), compared to S$11.40 psf for the corresponding period in 2025.

Hongkong Land noted that overall contributions from Singapore were lower, following the divestment of Marina Bay Financial Centre Tower 3 in December 2025. This was partially offset by new fund management income as well as the group’s share of distributions from Suntec real estate investment trust (Reit).

Commenting on the results, Smith said the group’s growth is “underpinned by the continued execution of existing initiatives, including its Tomorrow’s Central transformation in Hong Kong, as well as progressive launches at Westbund Central in Shanghai and other commercial projects in its pipeline”.

He added that capital recycling, including the wind-down of its build-to-sell business, continues to be a priority.

Shares of Hongkong Land closed 0.9 per cent or US$0.07 lower at US$7.89 on Tuesday, before the H1 results were announced.