Jardine Matheson still unclear on full-year outlook amid Covid-19 business impact

JARDINE Matheson Holdings said on Thursday that its full-year outlook remains uncertain, despite progress for "most businesses" in its portfolio.

The investment company still faces challenges from the Covid-19 pandemic, it announced in an interim business update for the first quarter.

Fully-owned Jardine Pacific, which holds non-listed interests in Asia, posted "a good overall performance in the period".

These included higher contributions from construction services joint venture Gammon; lift and escalator joint venture Jardine Schindler; food service franchisee Jardine Restaurants; and Hong Kong Air Cargo Terminals.

The Jardine Motors business unit saw earnings rise year on year across all markets, fuelled by factors such as strong demand for new cars in mainland China and Hong Kong. But Singapore-listed, 75 per cent-owned Jardine Cycle & Carriage reported a contraction in business, on weaker contributions from Indonesian conglomerate Astra.

"Jardine Cycle & Carriage's overall performance has gradually improved in recent quarters, but the pandemic and related containment measures are expected to continue to affect its performance for some time," the parent company said, while noting improvements at strategic investments Truong Hai Auto Corp and Siam City Cement.

Jardine Matheson also reiterated summaries of the performance at other listed subsidiaries - developer Hongkong Land, luxury hotelier Mandarin Oriental and retailer Dairy Farm - that had posted separate business updates to the Singapore bourse the day before.

For instance, Mandarin Oriental expects losses to extend into the second quarter, while Dairy Farm faces a decline in grocery sales as consumer behaviour normalises.

Meanwhile, Jardine Matheson affirmed that it would "maintain a prudent funding approach" involving capital allocation and investment-grade credit metrics, after the consolidation of Jardine Strategic Holdings was completed in April.

"Progress to refinance the acquisition debt facility is well advanced," Jardine Matheson said, while confirming that the deal would have increased key net borrowings to US$9.2 billion and net gearing to 16 per cent as at Dec 31, 2020 on a pro forma basis.

It added that it "remains resilient and well-positioned to achieve its long-term growth objectives, with a strong balance sheet and liquidity position".

Jardine Matheson, which is listed in London, Bermuda and Singapore, closed on Thursday at US$66.48, up by US$0.47 or 0.71 per cent, before the news.