Jardine Matheson Holdings, a diversified Asian-based business group, says its performance for the 3QFY2023 ended Sept 30 was “marginally above” the same period last year. The growth was thanks to higher contributions from Astra, DFI Retail Group D01 and Mandarin Oriental and offset by lower contributions from Jardine Pacific and Hongkong Land.
Overall, the group is expecting to see underlying profits for the 2HFY2023, broadly in line with that of 2HFY2022’s figures.
“Although challenges remain from the global economic environment and softening commodity prices, the group remains confident in the economic resilience of its markets and is well-positioned to benefit from their recovery,” says Jardine Matheson in its Nov 9 statement.
Astra saw a 12% y-o-y increase in its underlying earnings for the 3QFY2023 due to strong growth from the automotive division, which saw higher car and motorcycle sales and increased market share. The company’s financial services division also benefitted from the growth in sales and saw higher lending volumes. Profit from heavy equipment and mining division, however, stood flat y-o-y mainly due to lower coal selling prices. That said, this was mitigated by improved performances from its heavy equipment and mining contracting operations. The agribusiness division was adversely impacted by lower crude palm oil prices.
Hongkong Land saw lower underlying profit in the 3QFY2023 on a y-o-y basis. Total contributions from its investment properties arm stood broadly in line with higher contributions from the group’s luxury retail portfolio and Singapore office business, which offset lower contributions from the Hong Kong office portfolio. During the period, the group saw lower contribution from its development properties arm, which was due to fewer planned sales completions and slower sales on the Chinese mainland.
According to Hongkong Land, market sentiment for residential properties in China still remains week. Planned sales completions for the group are expected to be lower y-o-y for the FY2023. Hongkong Land’s full-year underlying profits are now expected to be moderately below the prior year. The group’s Central office portfolio in Hong Kong saw physical vacancy of 7.3% as at Sept 30, compared to 6.9% as at June 30. On a committed basis, vacancy was 6.8%, compared to 6.2% at the end of June. Overall Central Grade A office market vacancy was 9.7% at the end of September. Rental reversions remained negative while leasing activity softened further compared to the 1HFY2023. Vacancy for the group’s Landmark retail portfolio remained low at 1.7% as at Sept 30. In Singapore, the group’s physical vacancy was 2.1% at Sept 30, unchanged compared to the end of June 2023. On a committed basis, vacancy was 0.8%, compared to 1.0% at the end of June.
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DFI’s underlying profits for the 3QFY2023 surged by over 80% y-o-y due to strong profit growth from its health and beauty and convenience divisions, which more than offset the lower results from its grocery retail arm and Ikea.
Jardine Pacific saw lower contribution in the 3QFY2023 y-o-y mainly due to losses incurred by Jardine Restaurant Group in Hong Kong and Vietnam. The group’s disposal of its stake in Greatview was completed in September.
Jardine Cycle & Carriage saw underlying profit for the 3QFY2023 increase by 14% y-o-y mainly due to higher contributions from Astra and Direct Motor Interests. This was offset by the lower profits from THACO and Siam City Cement with the former’s results impacted by the challenging market conditions in Vietnam.
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Mandarin Oriental saw stronger y-o-y performance in the 3QFY2023 due to higher fee income from its management business and improved earnings from its owned hotels, particularly in Hong Kong and Tokyo. The group reopened its hotel in Singapore in September. The group’s combined revenue per available room (RevPAR) stood substantially ahead of its pre-pandemic levels in the 3QFY2023 driven by rates although occupancy remained below its pre-pandemic levels. RevPAR in Europe, the Middle East and Africa saw y-o-y growths due mainly to higher rates while Asia’s RevPAR saw a substantial improvement due to higher rates and better occupancy rates.
Shares in Jardine Matheson, DFI, Jardine C&C and Mandarin Oriental closed at US$40.32 ($54.74), US$2.35, $29.37 and $1.52 respectively on Nov 9.
