The Wharf (Holdings) (4) H2 2025 earnings summary

Executive summary

• Group profit increased by HK$3.3 billion due to significantly reduced property revaluation deficits and impairment provisions, totaling HK$3.5 billion, reversing a prior loss and restoring profit to HK$50 million.

• Underlying net profit surged 47% year-over-year to HK$4,104 million, driven by reduced development property provisions and lower borrowing costs.

• The group ended the year net debt free, achieving a net cash position of HK$4.5 billion after disposing of HK$9.7 billion in equity investments.

• Net asset value per share increased 7% to HK$48.01.

• Dividend per share maintained at HK$0.40.

Financial highlights

• Underlying net profit rose 47% to HK$4,104 million, mainly from reduced mainland DP provisions and lower borrowing costs.

• Group revenue declined 9% year-over-year to HK$10,997 million; operating profit fell 10% to HK$5,068 million.

• Attributable IP revaluation deficit after tax narrowed to HK$3,641 million from HK$5,990 million.

• Earnings per share improved to HK$0.02 from a loss of HK$1.05; underlying EPS up 46% to HK$1.34.

• Dividend payout ratio was 30% of underlying net profit.

Outlook and guidance

• Hong Kong property market is regaining confidence, but faces risks from interest rate volatility and inventory overhang.

• Mainland China property market remains a concern, with weak fundamentals, policy-driven sentiment, and overcapacity.

• The group will continue leveraging core strengths and prudent financial management to navigate ongoing headwinds.

• Budgeting for flattish rental income performance in mainland China for the year, with early signs of recovery.

• Global risks include geopolitical tensions, trade disruptions, and rapid technological change.