MTRC 0066

MTRC 0066

Postby winston » Tue May 20, 2008 10:02 am

BROKER CALL - Hong Kong's MTRC kept 'sell' as EPS forecasts cut - Goldman Sachs

HONG KONG (XFN-ASIA) - Goldman Sachs reiterated a "sell" call on MTR Corp along with a target price of 25 hkd, citing a cut in earnings forecasts for the local commuter rail operator and property developer.

Goldman cut its 2008 and 2009 earnings per share (EPS) forecasts for MTR by 4.8 pct and 15.8 pct, respectively, to 1.29 hkd and 1.37 hkd.

"The revisions in 2008 and 2009 EPS are largely due to changes in our timing assumptions for profit booking on residential property sales," the US house said.

Goldman forecast EPS of 1.5 hkd for 2010.

MTR shares today ended down 0.1 hkd or 0.37 pct at 26.96
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Re: MTRC 0066

Postby winston » Thu Jul 31, 2008 11:11 am

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WEN WEI PO

-- Rail company MTRC (0066.HK: Quote, Profile, Research) is predicted to record a decline in interim profit. The decrease is estimated to reach as much as nine percent due to factors such as its weaker property sales performance.
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Re: MTRC 0066

Postby winston » Mon Aug 04, 2008 8:06 am

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Slowing property revenue likely to hit MTR earnings
Alfred Liu
Monday, August 04, 2008

First-half earnings of MTR Corp (0066), Hong Kong's largest landlord after the government, are expected to fall due to the lack of completed property projects during the period, analysts said.

Credit Suisse predicted the sole subway operator, which is set to announce its first-half results tomorrow, will report a decline of 17 percent in underlying profits from a year ago.

"The big swing in earnings depends on how much of the surplus proceeds from The Harbourside [atop MTR Kowloon Station] inventory is MTRC going to book," Credit Suisse analysts Cusson Leung and Ronney Cheung wrote. UBS analyst Eric Wong said in a report: "Property development profit is solely contributed by sharing at The Harbourside [HK$130 million]."


MTRC reported underlying profit for the first half last year totaled HK$2.05 billion.

The results will incorporate for the first time the full six months' results of Kowloon and Canton Railway Corp, which was merged with MTRC last December. "Earnings performance will remain positive as supported by the merger synergy," said Daiwa Institute of Research analyst Jonas Kan. "But its earnings from property projects such as The Palazzo are not likely to be booked during the period." Credit Suisse said two projects - The Palazzo and Capitol - are not expected to be completed until later this year, and that its first-half forecast only factored in a deferred income of HK$300 million.

UBS said: "On rail operations, we see a 70 percent jump in Ebitda [earnings before interest, taxes, depreciation and amortization] to HK$3.65 billion."
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Re: MTRC 0066

Postby winston » Tue Aug 05, 2008 10:58 pm

Not vested.

MTR First-Half Profit Rises 15% on Hong Kong Property
By Kelvin Wong and Mark Lee

Aug. 5 (Bloomberg) -- MTR Corp., Hong Kong's subway operator, boosted first-half profit 15 percent after a combination with the city's other railway company helped increase its real-estate holdings and passenger numbers.

Net income rose to HK$4.69 billion ($601 million), or 83 cents a share, from HK$4.07 billion, or 73 cents, a year earlier, the company said in a stock exchange statement today. Sales rose 76 percent to HK$8.5 billion.

MTR sold more tickets after taking over the network of commuter railroad operator Kowloon-Canton Railway Corp. in December. The tie-up also boosted MTR's real estate profit by expanding available development rights by 54 percent and investment-property floor area by 22 percent.

``The merger brought much extra fare revenue,'' said Kenny Tang, associate director at Tung Tai Securities Ltd., before the earnings announcement. ``In the long run, things look good for them, even on the property side, as they've gotten all this cheap land from the merger.''

Underlying profit, which excludes property revaluation gains, rose 33 percent to HK$2.7 billion. Operating profit, before depreciation and amortization, from railways and associated businesses rose 72 percent to HK$4.8 billion.

Property Sales

Profit from property developments fell to HK$348 million in the first half from HK$1.7 billion, as it booked fewer sales. The company expects to book the revenue from its Capitol and Palazzo projects in the second half, Chief Executive Officer Chow Chung Kong told reporters in the city today. Hong Kong developers book all sales from a development when the project is completed.

The train operator has dropped 15 percent this year in Hong Kong trading, compared with a 21 percent decline for the benchmark Hang Seng Index. The stock dropped 1 percent to HK$24.35 in Hong Kong today, before the earnings were announced.

MTR, which also operates the city's Airport Express train and bus services, moved 721.2 million passengers in the first half. That's 66 percent more than it handled on its own a year earlier, and a 4 percent rise from MTR and KCR's combined tally.

Today's results are the first full set from the combined company. MTR took over the operations of city-owned KCR last year under a government-led tie-up. It subsequently cut fares by as much as 35 percent.

The tie-up cut MTR's profit margin because the KCR lines are less profitable, Finance Director Lincoln Leong said at the press conference. Profitability may shrink further in the second half, Leong said, without elaboration.

Higher Dividends?

MTR, 76 percent owned by the Hong Kong government, will pay a first-half dividend of 14 Hong Kong cents, unchanged from a year earlier. The company will consider increasing dividends when it reports full-year earnings, it said.

The railway operator has expanded outside Hong Kong to reduce its reliance on its home market. In November, its venture with Laing Rail began operating five commuter rail lines in the Greater London area under a seven-year contract.

In China, the company is building a Beijing metro line, due to enter service about the end of 2009. It's also seeking approval for a subway project in Shenzhen, the Chinese city neighboring Hong Kong.


The company is also working on plans for six new lines in Hong Kong, with a total length of about 60 kilometers (37 miles).
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Re: MTRC 0066

Postby winston » Wed Aug 06, 2008 6:21 am

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Merger benefits drive MTRC first-half gains
Alfred Liu
Wednesday, August 06, 2008

MTR Corp (0066) beat market expectations, reporting that first-half underlying profit surged 33.2 percent to HK$2.73 billion, driven by its financial benefits from the rail merger.

Analysts had expected the subway operator to generate an underlying profit from HK$1.70 billion to HK$2.53 billion for the six months ended June.

Profit including investment properties revaluation and related deferred tax rose 15.2 percent to HK$4.69 billion, while earnings per share were 83 HK cents, up from 73 HK cents a year ago. An interim dividend of 14 HK cents per share was proposed.

The company, which incorporated for the first time the full six months' results of Kowloon and Canton Railway Corp, said revenue jumped 75.7 percent to HK$8.53 billion year-on-year, of which fare revenue contributed HK$5.59 billion, up 72.2 percent.

Patronage of domestic service increased 36.3 percent.

Earnings before interest, taxes, depreciation and amortization were 71.5 percent higher at HK$4.8 billion.

Chief executive Chow Chung-kong said the company will study the fare adjustment mechanism when the fare freeze ends at the end of June next year.

"I don't think that at this point of time I can talk about further fare reduction," he said, adding that the company has to protect stakeholders' interest under high inflationary pressures.

Meanwhile, Hong Kong's largest landlord after the government said property development profit plunged 79.1 percent to HK$348 million in the first half. "This is due to the timing difference in the recognition of profit," Chow said. "Depending on the timing of issuance of occupation permits, profits from the Capitol and Palazzo may be recognized in the second half."

The major contributors to its property development profit in the first half were the sale of units in inventory at Harbour Green and The Arch along the airport railway, as well as deferred income recognition from Coastal Skyline, Caribbean Coast and Elements.
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Re: MTRC 0066

Postby winston » Mon Jan 12, 2009 8:56 am

Mall-mad mainlanders can still blow a million - BonnieChen
Monday, January 12, 2009

Cash-rich mainland shoppers are continuing to spend, spend, spend, despite the global financial crisis, according to operators of MTR Corp's shopping malls.

Travelers from the mainland are particularly splashing their cash at the high-end Elements shopping mall in Tsim Sha Tsui, with some forking out as much as HK$1 million in a single spree.

MTRC chief development manager Betty Leong Sin-ling says that overall, there was an average 15 to 20 percent increase in customer traffic at all MTRC malls over the Christmas and New Year period.

Elements showed a 15 percent year-on- year increase in traffic, reaching 175,000 customers a day during the Christmas period. On New Year's Eve, there was a 60 percent surge compared to normal days. "It was better than we forecast, the market was still bullish. We expect there will be 5 to 10 percent increase in customer traffic during Chinese New Year," said Leong, who did not disclose the corresponding business volumes.

She said 35 percent of shoppers are from the mainland, who spend from HK$20,000 to HK$1 million each.

"They mainly buy jewelry, clothes and handbags. Some still bought more than HK$1 million worth of jewelry in October and November despite the financial tsunami," Leong added.

Rents in Elements are high, but Leong said the mall is 100 percent leased, with a waiting list of potential high-end tenants.

Asked if there was pressure to cut rents, Leong said the mall only opened in October 2007, and most companies have three-to five- year leases. She wouldn't say if rents could come down at other MTRC shopping malls.

Hong Kong's major travel agencies sent a joint letter to major developers, including the MTRC, requesting a 50 percent cut in rents in the coming six months.

None of the developers has responded, and the railway corporation has increased its management fees and air-conditioning charges.

To alleviate pressure on shop owners, Leong said the corporation will take care of 70 percent of the cost of promoting its malls, up from the previous 50 percent.

She said more will be spent on coupons and other incentives for customers instead of mall decorations.

The MTRC spends about HK$100 million on mall promotion each year.
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Re: MTRC 0066

Postby winston » Wed Jan 21, 2009 12:25 pm

DJ MARKET TALK: MTRC +0.5%; Helped By Swedish Rail Project Win

1105 [Dow Jones] MTRC (0066.HK) +0.5% at HK$17.82 vs HSI down 1.7%, boosted by AFP report it's won HK$20 billion concession to operate Sweden's Stockholm Metro for 8 years. Follows news earlier in week it will participate in Hangzhou subway project, marking 3rd China rail project MTRC managed to make progress on over past 2 months, according to Daiwa.

MTRC previously perceived as quasi-property developer, with property projects along rail lines subsidizing money-losing rail operations. Aggressively seeking rail projects outside HK may improve sentiment toward stock. Volume modest at HK$19.3 million; 10-, 20-, 50-day moving averages intertwined at slightly below HK$18.00, clean breach may herald more upside.
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Re: MTRC 0066

Postby winston » Thu Feb 05, 2009 3:05 pm

DJ MARKET TALK: Fare Hike Is Next Driver For MTR Corp - Goldman

1513 [Dow Jones] STOCK CALL: Goldman Sachs tips MTRC (0066.HK) shares to be relatively resilient amid volatile market environment, given defensive nature of rail operations (43% of 2009 NAV). But tips downside risk to earnings estimates, due to slowing momentum of station commercial business (17% of NAV) and potential delays to development property launches.

"The next key driver for MTRC's share price is the fare increase in mid-2009," says Goldman. Tips a failure to realize this would cut its 2009 earnings estimates by 2.5%. Adds, stock to stay rangebound near-term amid absence of any major catalyst. Keeps Neutral, target HK$17.80. Stock +1.4% at HK$18.50; HSI up 2.4%
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Re: MTRC 0066

Postby winston » Wed Feb 11, 2009 10:22 am

DJ MARKET TALK: Morgan Stanley Starts MTR Corp At Underweight

0847 [Dow Jones] STOCK CALL: Morgan Stanley starts MTR Corp. (0066.HK) at Underweight, target HK$16.40. "While MTRC's regulated returns, virtual monopoly, asset-light property portfolio, defensive rail earnings, and good cash-flow generation (6%) suggest relative safety amid the current market volatility, we expect the stock's performance to be capped by earnings revision risk and rich valuation."

Adds, property fundamentals weak, returns low, dividend yield of 2.5% not exciting. Notes house's 2009-10 EPS estimates 40%, 30% below consensus on lower property-price assumptions. Shares closed up 1.0% at HK$18.08 yesterday.
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Re: MTRC 0066

Postby winston » Fri Feb 20, 2009 6:11 pm

DJ MARKET TALK: MTRC Still A Defensive Play - CLSA

1110 [Dow Jones] STOCK CALL: CLSA says it continues to see MTRC (0066.HK) as defensive company given healthy cash flows emanating from railway business. Keeps Outperform with HK$20.00 target. "A potential return of 16% comprising 13% capital gains and a somewhat mediocre 3% yield is attractive in the current environment." Says, catalysts for MTRC involve award of mainland/overseas projects, negotiation of attractive terms for substantial pipeline of projects in Hong Kong. Stock off 1.6% at HK$17.60.
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