HPH Reports HK$608.2m Profit In 4Q11
Hutchison Port Holdings (HPH) Trust, the largest initial public listing (IPO) on the local bourse last year, reported profit of HK$608.2 million ($98.5 million) for the fourth quarter ended 31 December 201l. Distribution per unit (DPU) for the July to December six-month period was $HK0.234. The quarter’s profit was in line with forecast, which was HK$592.9 million as per its IPO prospectus. For the full-year, starting on constitution date 25 February, the trust’s profit was 4.8 percent higher at HK$1.97 billion as against forecast of HK$1.88 billion. DPU was also higher, at HK$0.377 as compared to the projected HK$0.374. The sole miss was revenue – for the quarter, it came in at HK$3.1 billion against forecasted HK$3.2 billion; for the year, it was 4.9 percent lower at HK$9.7 billion compared to the projected $10.2 billion.

Significance: The economic slowdown in Europe and the US has led to the lower-than-forecasted revenue. To cushion the impact, HPH will focus on increasing volume growth on transshipment, intra-Asia trade and certain high-growth trade routes out of the Africa, Middle East, Oceania as well as Central and South America.

OUE’s FY11 Earnings Fall On Lower Fair-Value Gains
For the full-year ended 31 December 2011, Overseas Union Enterprise’s (OUE) earnings fell 56.5 percent to $335.7 million, weighed mainly by an increase in finance costs as well as lower fair value gains. Revenue, on the other hand, jumped 54.2 percent to $332.4 million. Income from its hospitality division improved to $215.5 million from $172.3 million, making up 64.8 percent of the overall FY11 revenue. Income from its property investment arm surged 177.8 percent to $106.9 million due to full-year contributions from DBS Building Towers One and Two as well as OUE Bayfront. OUE’s executive chairman Stephen Riady remarked, “In the face of economic uncertainties around the world in 2012, we remain committed to identifying opportunities and will continue to maximise the value of our portfolio with our asset enhancement model.” OUE has proposed a special dividend of $0.08 per share, in addition to a final dividend of $0.03 per share.

Significance: Notwithstanding the lower earnings, which resulted from the lower fair value gains, the bright spot was its healthy income growth across all business divisions. Drawing reference to the Singapore’s record tourism receipts of $22.2 billion in 2011, this will benefit its hospitality arm in 2012 should the trend continues.

Tiger’s 33%-stake Mandala To Resume Flying
Tiger Airways Holdings’ 33 percent stake venture PT Mandala Airlines is set to resume flying, after receiving its air operator’s certificate (AOC) from the Indonesian director-general of air communications. This reactivation came a year after the airline was suspended of its operations in January 2011. Given the latest development, the airline is scheduled to resume flying in April. Accordingly, the restructured airline will adopt Tiger’s low cost business model by offering low fare travel to international and domestic Indonesian destinations within a five-hour flying radius. Tiger is expected to transfer up to 10 of its Airbus A320 planes to Mandala over the coming year.

Significance: OCBC called this ‘a positive development’ as it would help to absorb Tiger’s expected upcoming new aircraft deliveries. Nevertheless, the research house reiterated its ‘Sell’ rating in view of poor load factors and rising fuel costs.