Hutchison Port Holdings Trust (HPHT) has just released its FY2022 ended December 2022 results, which saw distribution per unit (DPU) unchanged from the previous year at 14.5 cents.
Earnings however was down by 37.1% y-o-y at HK$1.10 billion ($185.7 million), causing earnings per unit to decline by 37.1% to 12.62 HK cents.
Revenue and other income for the FY2022 fell by 8.1% y-o-y to HK$12.17 billion as combined container throughput of HIT, COSCO-HIT and ACT (collectively known as HPHT Kwai Tsing), fell by 11.4% y-o-y mainly due to lower local and transshipment cargoes. HIT refers to Terminals 4, 6, 7 and the two berths in Terminal 9 at Kwai Tsing, Hong Kong. COSCO-HIT refers to Terminal 8 East, also at Kwai Tsing. ACT refers to Terminal 8 West at Kwai Tsing.
The lower revenue was also attributable to the lower container throughput of YICT, which fell by 4.2% y-o-y. The decrease is primarily driven by the decrease in the US, EU and transshipment cargoes, but partially offset by higher empties. YICT refers to Yantian International Container Terminals, located at Yantian, Shenzhen in China.
While the group is more positive for FY2023 with the year seeing some “encouraging developments” with the relaxation of Covid-19 measures in China and the reopening of borders at Hong Kong, OCBC Investment Research is not as bullish considering other factors.
Analyst Chu Peng says: “Looking into 2023, earnings outlook remains uncertain, given an inflationary and recessionary environment with major economics such as Europe and US expected to enter a recession this year.”
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“While HPHT could benefit from China’s exit from zero-Covid policy and easing supply chain disruptions, HPHT’s performance could remain under pressure in 1HFY2023, given a high base effect, and time taken for Hong Kong to redeem its position as a transhipment hub,” she adds.
For FY2023, management expects a flattish throughput volume growth. In terms of DPU, management guided for full-year DPU of 14 to 15 HK cents for FY2023.
With that, Chu has kept her “hold” recommendation on HPHT with a lower fair value estimate of 19.5 US cents from 20.0 US cents previously.
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As at 4.20pm, units in HPHT are trading at 21 US cents.
Photo: HPHT
