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Jardine Matheson's Q3 net profit improves from Q2, but down compared with 2019

JARDINE Matheson Holdings on Tuesday reported declining net profits in the third quarter of 2020 from a year ago, due to the impact of the Covid-19 pandemic and as government support tapers off.

Compared with Q2 however, the group saw improvement in many of its businesses, thanks in part to government support, the company said in an interim management statement on Thursday, without specific numbers.

Jardine Pacific had an overall increase in earnings in Q3 from the previous quarter, with improved contributions from Jardine Engineering Corporation, Hong Kong Air Cargo Terminals Limited and Jardine Restaurant Group's Pizza Hut businesses in Hong Kong and Taiwan.

Gammon Construction's order book remained healthy, boosted by its securing of Hong Kong International Airport Terminal 2's expansion works project in August, it added.

Jardine Motors' performance improved in Q3 from Q2, with Zung Fu China and Zhongsheng benefiting from a strong recovery in luxury car sales.

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Other businesses however experienced weaker underlying trading performances. Jardine Aviation Services had been significantly affected by low flight volumes and remain "loss-making", Jardine said.

As for Jardine Strategic's businesses, Hongkong Land's overall performance continued to be negatively impacted by the pandemic, it said. In particular, retail rent in its investment properties business took a hit, although contributions from the office portfolio remained stable.

However, sentiment in Hongkong Land's main markets in mainland China has generally recovered to pre-pandemic levels, it said.

Dairy Farm also had better showing in Q3 than Q2, although it continued to be affected by Covid-19. Grocery retail performed strongly in North Asia, Singapore and Malaysia, supported by operational improvements as part of the group's multi-year transformation programme, as well as changing customer behaviours as a result of the pandemic. This was not the case for Indonesia, however, which faced significant impact from government restrictions.

Meanwhile, Mandarin Oriental also continued to be severely impacted by Covid-19, with business levels remaining low even though almost all hotels in its portfolio have reopened. It added that a material recovery is not expected until the second half of 2021, which means it will report a "substantial loss" for 2020.

Jardine Cycle & Carriage's performance also continued to be affected by challenging trading conditions, the group said, although Q3 had better showing than Q2.

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