Hutchison Port Holdings Trust trims Q4 DPU to 5 HK cents

Annabeth Leow
Published Mon, Feb 10, 2020 · 11:36 AM
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HUTCHISON Port Holdings Trust (HPHT) has trimmed fourth-quarter distribution per unit (DPU) to five HK cents (0.89 Singapore cent), from 8.48 HK cents before.

The DPU for the three months to Dec 31, 2019, announced in results on Monday, lowers the full-year payout by 35.3 per cent to 11 HK cents, compared with 17 HK cents previously.

While revenue was down by 11 per cent year-on-year to HK$2.67 billion on a drop in transshipment cargo, operating expenses did not fall as fast, eating into operating profit.

Otherwise, the trust recovered from multimillion-dollar impairments in the year prior to post net profit of HK$62.3 million against an earlier HK$12.1 billion loss. Excluding the impact of the impairments, profit attributable to unitholders was however 65.9 per cent lower at HK$62.3 million.

With mainland China making up more than two-thirds of income, the trust noted in its financial statements that it took a hit to outbound cargo to the United States in Q4 2019, amid a trade war between the two countries that saw cargo front-loading in the year-ago period.

Even now, the US-China trade spat has been only partially resolved by a Phase One trade deal and "it is not expected the trade dispute can be easily and fully settled shortly", the management said.

It also pointed to the potential disruption of supply chains and global trade, as China stopped business activities to fight the deadly outbreak of a novel coronavirus.

"Against this backdrop of political and market volatility, (HPHT) management remains cautious about future cargo trends and will continue to exercise cost discipline while pursuing efficiency improvements," HPHT said, even as it flagged another hit from higher compliance costs at shipping lines, as new low-sulphur fuel regulations kicked in on Jan 1.

For the full year, HPHT posted a net profit of HK$528.2 million, down by 28.4 per cent on the year before, with the impairments excluded. Revenue slipped by 3.1 per cent to HK$11.1 billion.

For the latest payout, the books close on Feb 18 and the DPU will be paid out on March 27.

Separately, HPHT announced that independent director Kevin Westley will retire on Tuesday at the age of 70, after exactly nine years on the job.

HPHT closed down by 0.1 US cent or 0.62 per cent to US$0.161 on Monday before the results were announced.

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