Hutchison Whampoa Ltd , billionaire Li Ka-shing's ports-to-telecoms flagship company, beat expectations by doubling its 2011 earnings, driven by extraordinary gains from a spinoff and higher contributions from its infrastructure and energy businesses.
Hutchison, whose businesses include third-generation network operator 3 Group and Watsons retail stores, on Thursday reported a net profit of HK$56.019 billion ($7.2 billion) for 2011.
This was 178 percent higher than the restated net profit of HK$20.179 billion for 2010 and a forecast of HK$51.5 billion from seven analysts polled by Thomson Reuters I/B/E/S.
"A measure of uncertainty is expected to remain in 2012," said Li, Asia's richest man and chairman of the company. "Monetary tightening in the mainland (China), which has successfully curbed inflation, will slow the rate of growth in the short term, but growth will continue to increase in the long term."
Hutchison said in a statement it made a HK$55.6 billion dilution gain arising from the spin-off and Singapore listing of its southern China ports assets, Hutchison Port Holdings Trust .
Hutchison's telecoms business 3 Group includes 3G network operations in Britain, Italy and Australia, among other countries. Its 3G arm posted an EBIT (earnings before interest and tax) of HK$1.48 billion during the year, with its 3G customer base totalling more than 31.6 million worldwide, up 7 percent for the year.
INFRASTRUCTURE, ENERGY, RETAIL BOOST GROWTH
Analysts had expected Hutchison earnings to get a boost from exceptional gains, mainly from the spin-off of HPH Trust with recurring earnings driven by infrastructure, retail, and energy. Its 3 Group was forecast to achieve full-year positive EBIT.
The company said net profit more than doubled, helped by a hefty one-off gain from the spin-off of its port assets, earnings from Cheung Kong Infrastructure (CKI), Husky Energy and retail.
Earlier this month, CKI posted a 54 percent rise in 2011 profit to HK$7.75 billion, in line with a street view of HK$7.73 billion.
Husky Energy, one of Canada's largest producers of heavy crude oil, said in February that its fourth-quarter profit nearly tripled as production and oil prices rose, but the results lagged estimates due to higher-than-expected exploration expenses and taxes.
Husky also warned that weakness in pricing for heavy crude grades as well as volatile refining margins have become a factor in 2012.
"We see scope for rising profits in E&I (energy and infrastructure) and retail due to recent acquisitions and potential M&A opportunities at CKI, higher production and high oil prices at Husky, and top-line growth and margin expansion in retail," Standard Chartered wrote in a research note ahead of the results.
In February, Hutchison said it would buy Orange Austria from France Telecom and a private equity fund in a deal valued at 1.3 billion euros ($1.73 billion) including debt.
Li's business empire bought British utility Northumbrian Water Group for 2.41 billion pounds ($3.82 billion) last year, having paid 5.8 billion pounds to buy the British electricity distribution network of France EDF in 2010.
Analysts said 3 Group Europe is expected to remain a major potential earnings swing factor for Hutchison.
"With its global footprint, Hutch stands to benefit from a seemingly stabilizing global economy," Bank of America Merrill Lynch said in a note. "Yet, as a global recovery is bound to be bumpy, we believe parent Cheung Kong is a lower risk way to get exposed to Hutch."
Cheung Kong (Holdings), which holds a controlling stake in Hutchison, posted a 72 percent rise in 2011 profit to HK$46.06 billion.
Hutchison, whose businesses include third-generation network operator 3 Group and Watsons retail stores, on Thursday reported a net profit of HK$56.019 billion ($7.2 billion) for 2011.
This was 178 percent higher than the restated net profit of HK$20.179 billion for 2010 and a forecast of HK$51.5 billion from seven analysts polled by Thomson Reuters I/B/E/S.
"A measure of uncertainty is expected to remain in 2012," said Li, Asia's richest man and chairman of the company. "Monetary tightening in the mainland (China), which has successfully curbed inflation, will slow the rate of growth in the short term, but growth will continue to increase in the long term."
Hutchison said in a statement it made a HK$55.6 billion dilution gain arising from the spin-off and Singapore listing of its southern China ports assets, Hutchison Port Holdings Trust .
Hutchison's telecoms business 3 Group includes 3G network operations in Britain, Italy and Australia, among other countries. Its 3G arm posted an EBIT (earnings before interest and tax) of HK$1.48 billion during the year, with its 3G customer base totalling more than 31.6 million worldwide, up 7 percent for the year.
INFRASTRUCTURE, ENERGY, RETAIL BOOST GROWTH
Analysts had expected Hutchison earnings to get a boost from exceptional gains, mainly from the spin-off of HPH Trust with recurring earnings driven by infrastructure, retail, and energy. Its 3 Group was forecast to achieve full-year positive EBIT.
The company said net profit more than doubled, helped by a hefty one-off gain from the spin-off of its port assets, earnings from Cheung Kong Infrastructure (CKI), Husky Energy and retail.
Earlier this month, CKI posted a 54 percent rise in 2011 profit to HK$7.75 billion, in line with a street view of HK$7.73 billion.
Husky Energy, one of Canada's largest producers of heavy crude oil, said in February that its fourth-quarter profit nearly tripled as production and oil prices rose, but the results lagged estimates due to higher-than-expected exploration expenses and taxes.
Husky also warned that weakness in pricing for heavy crude grades as well as volatile refining margins have become a factor in 2012.
"We see scope for rising profits in E&I (energy and infrastructure) and retail due to recent acquisitions and potential M&A opportunities at CKI, higher production and high oil prices at Husky, and top-line growth and margin expansion in retail," Standard Chartered wrote in a research note ahead of the results.
In February, Hutchison said it would buy Orange Austria from France Telecom and a private equity fund in a deal valued at 1.3 billion euros ($1.73 billion) including debt.
Li's business empire bought British utility Northumbrian Water Group for 2.41 billion pounds ($3.82 billion) last year, having paid 5.8 billion pounds to buy the British electricity distribution network of France EDF in 2010.
Analysts said 3 Group Europe is expected to remain a major potential earnings swing factor for Hutchison.
"With its global footprint, Hutch stands to benefit from a seemingly stabilizing global economy," Bank of America Merrill Lynch said in a note. "Yet, as a global recovery is bound to be bumpy, we believe parent Cheung Kong is a lower risk way to get exposed to Hutch."
Cheung Kong (Holdings), which holds a controlling stake in Hutchison, posted a 72 percent rise in 2011 profit to HK$46.06 billion.