Thursday, 13 August 2009

HPH profit falls 35% as throughput declines

Ports and Related

The sharp reduction in global trade volume that started in the fourth
quarter of last year continued into the first quarter of 2009. During the
second quarter, volumes generally stabilised, albeit at levels well below
2008. This decline has adversely affected the results of the ports and
related services division. The division handled a total throughput of
30.3 million twenty-foot equivalent units (“TEUs”) in the first six
months of 2009, 8% lower than that of the same period last year. Total
revenue in local currencies decreased 13% and after translation to
Hong Kong dollars, decreased 21% to HK$15,556 million. The
division’s EBIT in local currencies declined 31% and in Hong Kong
dollars was HK$4,487 million, 35% below the same period last year.
During the first half, the division implemented cost reduction initiatives
targeting to achieve an EBIT percentage decline not greater than the
revenue percentage decline. The full effect of many of these is
expected to be realised in the second half of the year. Although trade
volumes are normally seasonally higher in the second half of the year,
the Group’s current expectation is that trading activity will recover
slowly, presenting a continuing challenge to the division’s full year
earnings prospect.

Full report UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2009 can be found here:


In the first half of 2009, the impact of the decline of the global
economy adversely affected several of the Group’s global businesses.
However, with the support of Central Government’s initiatives, the
Mainland economy has to date maintained healthy domestic demand
and the impact of external economic factors affecting Hong Kong have
to date been largely mitigated.
The global economy has not regained its strength and in this difficult
economic environment, the Group will continue to focus on
maintaining strict operational and financial discipline. The Group’s
liquidity remains healthy. Although the economic environment will
have differing adverse effects on the Group’s various businesses
around the world, looking ahead, the Group’s established businesses
are expected to continue to be profitable and to perform satisfactorily,
and the 3 Group is expected to continue to progress. The Group’s
second half performance should be better than the first half and I have
full confidence in the long term prospects of the Group.
I would like to thank the Board of Directors and all employees around
the world for their loyalty, hard work, professionalism and
contributions to the Group.

Li Ka-shing
Hong Kong, 13 August 2009

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