The final distribution of the final exhibition increased by 9%. Continued acquisitions.
Linkage (00823) announced its full-year results as of the end of March this year. Net income and property income rose by 0.1% and 0.3% respectively to 10.037 billion yuan and 7.689 billion yuan. The increase was 7.2% and 7.1%. The final allocation of each fund unit was 1.4055 yuan, an increase of 9.57% year-on-year. Together with the interim distribution of 1.3062 yuan, the distribution per unit of the fund increased by 8.56% to 2.7117 yuan.
Chief Executive Wang Guolong said that under the stagnation of Sino-US trade wars, China will stimulate domestic demand to promote the economy, but will help its mainland shopping malls and increase investment opportunities. Chairman Nie Yalun said that in the future, apart from looking for acquisition opportunities in China and Hong Kong, the future will focus on other Asian countries. After the announcement of the results at noon yesterday, the stock price rose 2.2% against the market, closing at 95.85 yuan.
In recent years, the Link has made a big push into the Mainland. Last year, it announced that it will increase the upper limit of mainland assets from 12.5% to 20%. In January and March this year, it invested a total of about 9.16 billion yuan in Beijing Tongzhou and Shenzhen shopping industry. Some mainland assets reached 5, with assets accounting for 13.2%.
Hong Kong property income fell, there is room for rent
During the period, the Mainland’s net income and property income were RMB 1.026 billion and RMB 807 million, respectively, up 16.1% and 18% year-on-year. If the impact of the acquisition was eliminated, it would increase by 7.6% and 9.4% respectively. Mainly benefited from the retail and office renewal rental rates increased by 30.2% and 23.8%. Wang Guolong pointed out that the Sino-US trade friction continued to ferment, affecting the mainland’s monetary policy, and began to see mainland investors or developers have difficulties in refinancing. “There are many (selling) investment projects in the market.” In addition, although the market is worried about trade wars, the impact on the exhibition is not obvious.
In Hong Kong, property sales in Hong Kong fell by 1.4% to $9.011 billion, as a result of the sale of assets by the Link, including the sale of 12 properties for a period of about $12 billion. Excluding the related impact, revenue increased by 7.2%, of which retail rents rose by 7.1%, parking lot rents increased by 9.4%, and the lease renewal rate during the period increased by 22.5%. Wang Guolong admits that during the period, the tenant’s turnover exceeded the peers. Assuming the trend continues, the rent will have room for adjustment. In addition, the Link Shopping Centre mainly sells necessities related to people’s livelihood. Therefore, it is less affected by the recent decline in the retail market in Hong Kong. There is currently no plan to sell assets.
As for the Kwun Tong Waterfront Remittance, which was developed by Nanfeng Co., Ltd., the occupation paper was obtained in May. The tenants will be stationed in the year. Wang Guolong said that more than half of the retail and office floors have been rented, and the rent will be promoted in response to market conditions. “It’s too urgent, I want to get the ideal rent.” In addition, four projects in Tseung Kwan O, Tsz Wan Shan and Nam Cheong have been refurbished and are expected to be completed early next year. Another 24 projects are expected to be refurbished in 2023 next year. The total investment amount is more than 1.2 billion yuan.
Plans to repurchase 60 million units
The Link Expo also announced the “2025 Vision”, which strives to achieve a high single-digit compound growth rate and a continuous increase in the distribution of each unit.
In addition, the Link will continue to offset the loss of fund unit distribution caused by the earlier sale of assets, and will repurchase about 60 million units in the future under market conditions. Last year, the company repurchased 42.10 million units of funds at a total cost of 3.2 billion yuan.
The company is expected to continue to receive an “overweight” rating with new acquisitions, new projects and natural growth of existing properties, with an expected 8.5% to 9.5% growth per unit allocation over the next two years. .