Hongkong Land's H1 profit down 9% on higher tax charges

HONGKONG Land on Thursday reported a 9 per cent drop in its net profit for the first six months of 2015 to US$513 million.

"While operating results were marginally higher, this was offset by higher tax charges due to the geographic mix of sales," the property developer said.

This profit figure includes a net gain of US$94 million, principally arising from the valuation of the group's investment properties.

Stripping out non-trading gains, its underlying net profit fell by a milder 3 per cent to US$419 million.

The milder earnings drop was due to its associates and joint ventures posting smaller increases in the valuation of their investment properties compared with a year ago, coupled with a US$13.9 million reversal of asset impairment.

Revenue rose some 50 per cent to US$905 million, due to a jump in the sale of properties from US$116 million to US$420 million. Rental income and service income (service and management charges and hospitality service income) held steady.

Looking ahead, the company said: "While the strong performance from the commercial portfolio is expected to continue in the second half of the year, earnings from our residential business will be lower than last year mainly due to fewer completions in Singapore and no sales in Hong Kong."

Hongkong Land is a member of the Jardine Matheson Group.

Its directors have declared an interim dividend of six US cents per share, unchanged from the prior year.

Its counter lost one cent to close at US$7.64 on Thursday.