Wharf profit up by 14% in 2020

Recovery in the second half of the year reversed the negative growth in the first.

The Wharf (Holdings) Limited reported its group profit increased 14% to $3.86b in 2020 from $3.38b in the previous year as the industry started to recover in the second half.

“Washout in the first half was followed by pockets of recovery in the second half,” the group said in its annual report.

The group added its underlying net profit for the year rose 14% to $3.09b in 2020 from $2.71b in 2019. This is equivalent to $1.01 per share from only $0.89 per share in the previous year.

The company noticed disruption in the viewing and sales of luxury properties, but noted revenue and operating profit still posted increases to $1.453b and $797m largely from to Mount Nicholson development.

The group sold one apartment at Mount Nicholson during the year for $533m or $116,000 per square foot.

The Hong Kong developer also acquired Mansfield Road, increasing its land bank on the Peak to nearly 600,000 square feet, which is one of the largest in the developer’s portfolio.

It has started sale of 77/79 Peak Road, which includes six houses for sale and two others for lease, which will be on top of three houses already sold by tender for a total of $1.7b.

Moreover, it has started foundation work in building two blocks of 15-storey and two more of 17-storey residential buildings in Kowloon Tong. The group also sees potential in Kowloon East.

The Kowloon East portfolio involves sites with harbour view, including Kowloon Godown in Kowloon Bat, a Kai Tak site, and the Yau Tong Bay Project.

“Foundation is in progress for the site at Kai Tak, while redevelopment options are being evaluated for Kowloon Godown, and Yau Tong Bay project is in the planning stage,” the report read.

The group also reversed the negative growth in its Mainland China investment properties recorded in the first half of 2020 by launching a series of marketing initiative and expanding VIP customer base.

Its flagship malls recorded a full year revenue of $4.2b, representing a 7% increase, and operating profit worth $2.57b, 11% higher YoY.

Meanwhile, revenue of Wharf hotels declined 25% to $396m and operating profit of $1m due to lockdowns and cross-border travel restrictions. It has 16 hotels in China, Hong Kong and the Philippines, with a total of 5,500 rooms.

In April 2021, it will open Niccolo Suzhou, which will be the fifth landmark Niccolo Hotel in China and Hong Kong.