Amadeusz Juskowiak

Hutchison sees higher payout satisfactory profits

Hutchison Whampoa Ltd HWHHHK expects satisfactory profits in 1987 and will pay a higher dividend for the year chairman Li Kashing said

He did not make any specific projections for the companys earnings this year but he said the firm will pay a dividend of not less than 325 cents per share after a proposed fourforone stock split and a oneforfour bonus issue

It paid total dividends of 130 dlrs per share last year equal to 26 cents per share adjusting for the bonus and share split

Hutchison which has operations ranging from trading to property and container terminals earlier reported aftertax profits of 162 billion dlrs against 119 billion dlrs in 1985

The 1986 total excluded extraordinary gains of 563 mln dlrs partly from the sale of some of its stake in the South China Morning Post the leading English language newspaper compared with 369 mln dlrs the previous year It said it expects another 277 mln dlr gain in 1987 from the sale of the remaining shares

Li said Hong Kongs property market remains strong while its economy is performing better than forecast with its largely exportled growth

Gross domestic product grew by nearly nine pct last year against an initial government projection of 45 pct

But he said Hong Kongs large trade deficit with the US May result in protectionist measures that will adversely affect the British colony

He said all of the companys major operations showed improved results in 1986

Hutchison said earlier it will sell its entire 235 pct interest in Hongkong Electric Holdings Ltd HKEHHK to Cavendish International Holdings Ltd itself a spinoff from Hongkong Electric

Under a reorganisation announced separately Hongkong Electric will spin off all its nonelectricity related activities into Cavendish which will be listed on the local stock exchange Hongkong Electric shareholders will receive one share in Cavendish for every Hongkong Electric share

Cavendish will buy the 3482 mln Hongkong Electric shares from Hutchison by issuing 975 mln new shares

The spinoff and the sale of Hongkong Electric shares will give Hutchison a 53 pct stake in Cavendish

Li said the decision to spinoff Cavendish is to relieve Hongkong Electric of public criticism of the power company for making risky investments But he denied there was pressure from the government for the spinoff

He said Cavendish will have seven billion dlrs of assets and will be almost debt free with 340 mln dlrs of liabilites Its major assets are the Hong Kong Hilton Hotel property development and interests in Husky Oil Ltd HYOTO of Canada and Pearson Plc PSONL of Britain