International Investment and Material Kai Tak Project Returns Stable
Due to the decline in the profit rate of ground-based piling operations, and the substantial increase in financing costs and other expenditures, the net profit of the Hong Kong International Construction Investment (00687) of the HNA Group for the year ended last year was RMB 6.004 million, compared to the end of 2016. In the nine months, it earned 95.52% less, and earnings per share were 0.25 cents, sending a final dividend of 10 cents per share. Although three blocks of Kai Tak holdings or shares have been previously sold to Wheelock (00020) and Henderson (00012) respectively, Hong Kong International Construction Investment has full confidence in the development and construction projects of the Kai Tak District. I believe that Future years can bring stable returns.
Since Hong Kong International Construction Investment changed its fiscal year end date in the previous financial year, the 2017 annual results are compared with the nine months ended 2016 end-year results. During the performance period, Hong Kong International Construction Investment income increased by 8.57% to 3.29 billion yuan, and administrative expenses, financing costs and other expenses increased by 57.7%, 1.04 times and 3.45 times, respectively.
In the financing costs, interest expenses from bank borrowings and overdrafts surged by 6.39 times to RMB 115 million, and interest from secured bills recorded RMB 7.944 million. The company currently holds the Qide 6563 plot.
Hong Kong International Construction Investment pointed out that it will vigorously expand real estate investment and asset management business to achieve the company’s development and transformation. With regard to the foundation piling and construction business, due to the increase in market participants and the decrease in alternative projects, competition is expected to remain intense in the short term, and is also affected by labor shortages and rising operating costs. As a result, overall profit margins are under pressure, which will affect the relevant information this year. Business performance.
In terms of property development and investment, the company will seek opportunities for real estate development in the “Hong Kong, Macau, and Greater Bay Area" and “One Belt, One Road" key areas, focus on the development of EPC business, and introduce qualified investor funds in a light asset-rebranding model. Participate in real estate development business. In addition, the company will also vigorously expand real estate investment and asset management, focusing on investment opportunities in areas such as logistics, warehousing, and commerce.