Henderson Land Development Company (0012) H2 2024 earnings summary

Executive summary

• Underlying profit attributable to shareholders rose 1% year-over-year to HK$9,774 million, while reported profit dropped 32% to HK$6,296 million due to higher fair value losses and adjustments on disposed investment properties.

• Revenue declined 8% year-over-year to HK$25,256 million, mainly from lower property development sales in Hong Kong and mainland China.

• Property development pre-tax profit surged 31% year-over-year, driven by government land resumption gains; property leasing and utility segments delivered stable growth.

• The group maintains a strong financial position with net debt to equity at 21.1% and ample liquidity, despite a 17% decline in cash balances.

• Final dividend of HK$1.30 per share proposed, total annual dividend unchanged at HK$1.80 per share.

Financial highlights

• Property development revenue fell 15% year-over-year to HK$20,548 million, but pre-tax profit rose 31% to HK$5,632 million, including a HK$3,320 million gain from government land resumption.

• Gross rental income increased 1% year-over-year to HK$8,942 million; net rental income also up 1% to HK$6,507 million.

• HKCG (utility associate) contributed HK$2,954 million in net profit, up 3% year-over-year; dividend from HKCG flat at HK$2,712 million.

• Earnings per share based on underlying profit: HK$2.02; reported EPS: HK$1.30; total dividend per share: HK$1.30.

• Net asset value per share at HK$66.55, down 1% from prior year.

Outlook and guidance

• Over 6,400 residential units and 180,000 sq.ft. of industrial/office space in HK are available for sale in 2025, with 11 new projects in the pipeline.

• Attributable contracted sales yet to be recognized total HK$11,533 million, with HK$10,528 million expected to be recognized in 2025.

• Investment property portfolio to expand with new completions in HK and mainland China, targeting 13.6 million sq.ft. in China by end-2025.

• Ample land bank in Hong Kong and mainland China supports future development.

• HKCG to increase sustainable aviation fuel and green methanol production capacity by end-2025.