TIDMJAR
RNS Number : 1182M
Jardine Matheson Hldgs Ltd
19 May 2022
19th May 2022
For immediate release
Jardine Matheson Holdings Limited
Interim Management Statement
19th May 2022 - Jardine Matheson Holdings Limited (the
'Company') today publishes its Interim Management Statement for the
first quarter of 2022.
The Group saw a positive recovery in the performances of its
businesses in the first quarter compared with the same period last
year, with Astra, Hongkong Land, Jardine Cycle & Carriage and
the Motors business all delivering increases in profit. Jardine
Pacific saw a decline year-on-year and the performances of DFI
Retail and Mandarin Oriental were broadly flat, with these
businesses impacted by the resurgence of the pandemic in North
Asia. Overall, the Group's outlook continues to be uncertain,
reflecting both the challenges it faces - including COVID-19
restrictions in China - and the good recovery opportunities for
many of our businesses in Southeast Asia . We are grateful to our
colleagues across the Group, who continue to respond with
professionalism, resilience and dedication to the challenges of the
pandemic.
The performance of a number of Jardine Pacific's businesses was
adversely impacted by the resurgence of the pandemic in Hong Kong
in the period, although this was offset by operational improvements
driving better underlying performance in several businesses. The
contributions by Jardine Schindler and JEC were broadly flat
compared to the same period in 2021, while Gammon's profitability
was hit by reduced site activity and the performance of Jardine
Restaurants was severely impacted by pandemic restrictions in Hong
Kong. HACTL delivered a lower contribution as cargo volumes
softened due to slower export demand. Zung Fu Hong Kong reported a
loss for the period due to lower deliveries and after-sales
activities. Although Greatview's sales volumes continued to grow
steadily, margins were impacted by higher supply chain costs.
The Group's United Kingdom Motors business performed well due to
strong margins on both new and used cars, but new car volumes
remain low due to supply constraints. There was a higher
contribution from Zhongsheng, in respect of its performance from
July to December 2021, reflecting a higher gross margin in new car
sales and strong growth in aftersales and the used car
business.
Hongkong Land saw an improvement in underlying profit in the
period compared to the first quarter of 2021, principally due to a
greater number of Development Properties completions on the Chinese
mainland, while the contribution from Investment Properties was
broadly unchanged.
In Hong Kong, the increase in office leasing activity which was
seen towards the end of 2021 was reversed upon the onset of the
fifth wave of the pandemic, but there have been signs of a recovery
in leasing activity since the partial easing of anti-pandemic
measures in late April. Retail sales were lower than in the same
period in 2021, as footfall was significantly impacted by a lack of
overseas tourists and social distancing measures, with the latter
also restricting the operating capacity of F&B outlets.
Hongkong Land is providing temporary rent relief to support
selected tenants in the first half of 2022.
In Development Properties, market sentiment on the Chinese
mainland for residential properties remained cautious, and the
recent emergence of COVID-19 cases and related lockdowns in certain
regions partially curtailed sales and development activities.
Hongkong Land's underlying profits for 2022 are expected to be
lower compared to the prior year, primarily due to the timing of
sales completions on the Chinese mainland. In addition, the recent
emergence of COVID-19 cases and related restrictions in certain
parts of the Chinese mainland have partially curtailed some of the
group's sales and development activities. It is too early to
forecast with accuracy the impact these restrictions may have on
the group's full-year results, which will depend on the degree to
which mandatory restrictions remain in place for an extended period
and the extent to which construction progress on development
properties is impacted.
The performance of DFI Retail Group (DFI) was flat overall
year-on-year. The trading performance of both Grocery Retail and
Health and Beauty in North Asia benefitted in the quarter from
panic buying of core grocery products and a rush to buy COVID-19
protection items in response to the surge in COVID-19 cases in the
region. Heavy reductions in foot traffic, however, negatively
impacted Convenience performance. In Southeast Asia, stronger
year-on-year performance in Health and Beauty broadly offset some
softer performance in Grocery Retail.
IKEA's profitability in the quarter was broadly in line with the
prior year, reflecting strong cost control, but the business
continues to face challenges from pandemic-related restrictions on
the Chinese mainland and ongoing supply chain constraints, which
are likely to continue to impact trading performance. The
profitability of Maxim's, DFI's 50%-owned associate, was
significantly adversely impacted by government-imposed dining
restrictions following the surge in Omicron cases in Hong Kong.
Yonghui's underlying profitability increased in the first quarter
relative to the prior year, due to a combination of improved sales
revenue, higher gross margins and operating cost control. However,
DFI's reported results for 2022 will, as normal, also incorporate
Yonghui's reported losses for quarter ended December 2021, which
will have an adverse impact on DFI's overall profitability.
It is too early to forecast with accuracy the impact for the
rest of the year of pandemic-related restrictions in Hong Kong and
the Chinese mainland on DFI's own banners and its associate
business Maxim's; of continued competitive and pandemic related
challenges for Yonghui; and of supply-chain related challenges in
the home-furnishing business, but the full year reported results of
DFI are expected to be lower than in 2021.
Mandarin Oriental saw trading conditions in the quarter improve
in most parts of the world compared to the first quarter of 2021
and there was a reduction in its underlying loss for the period.
Travel restrictions, however, hampered operating performance in
Asia, with properties in China being particularly affected, and
these challenges have continued into the second quarter. There was
a more robust performance in EMEA and America.
The group's management business recorded a modest underlying
profit for the first quarter, while there was a small underlying
loss by owned hotels. The outlook continues to improve in most
markets, although there remains uncertainty in China.
Jardine Cycle & Carriage ('JC&C') delivered an improved
performance in the first quarter of 2022, compared to the same
period last year, mainly due to higher contributions from Astra and
Other Strategic Interests. THACO achieved higher automotive sales
and margins, but Siam City Cement was affected in particular by
high energy costs.
JC&C's Direct Motor Interests delivered a relatively stable
performance, with improved profits from Tunas Ridean and Cycle
& Carriage Bintang. Cycle & Carriage in Singapore, however,
recorded lower sales in challenging trading conditions.
Astra reported a significant increase in earnings in the period,
compared with the first quarter of last year, driven primarily by
the domestic economic recovery in Indonesia and higher commodity
prices. Astra's automotive division saw increased car sales as a
result of luxury sales tax incentives, and the financial services
division recorded higher lending volumes. The heavy equipment and
mining division also saw a strong performance, with increased heavy
equipment sales and higher coal selling prices, while the
performance of Astra's agribusiness division benefitted from higher
crude palm oil prices.
At the Jardine Matheson Holding's AGM on 5th May 2022,
shareholders approved the cancellation of 426,938,280 shares in the
Company as part of a reduction in capital (the 'Reduction') which
constituted the final stage in the Group simplification which
started last March. On 18th May 2022, the Company announced that
the Reduction had taken effect and that the Company's issued share
capital was now 289,435,103 shares.
Jardine Matheson is a diversified Asian-based business group
with unsurpassed experience in the region. Its interests include
Jardine Pacific, Jardine Motors, Hongkong Land, DFI Retail Group,
Mandarin Oriental, Jardine Cycle & Carriage and Astra. These
companies are active in the fields of motor vehicles and related
operations, property investment and development, food retailing,
health & beauty, home furnishings, engineering and
construction, transport services, restaurants, luxury hotels,
financial services, heavy equipment, mining and agribusiness.
Jardine Matheson Holdings Limited is incorporated in Bermuda and
has a standard listing on the London Stock Exchange, with secondary
listings in Bermuda and Singapore. Jardine Matheson Limited
operates from Hong Kong and provides management services to Group
companies.
- end -
For further information, please contact:
Jardine Matheson Limited
Jonathan Lloyd (852) 2843 8223
Brunswick Group Limited
Sunitha Chalam (852) 3512 5050
This and other Group announcements can be accessed through the
internet at www.jardines.com.
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