(Aug 13): CK Hutchison Holdings Ltd’s profit rose sharply in the first half of the year, driven by hefty gains from recent asset disposals by the Hong Kong conglomerate.

The company, founded by billionaire Li Ka-shing, reported HK$26.8 billion (RM13.95 billion) in net income for the six months ended June, a huge jump from the HK$852 million recorded in the year-ago period. Revenue came in at HK$255.4 billion, compared with HK$240.7 billion a year earlier. It announced an interim dividend of HK$0.75 per share, compared with HK$0.71 a year before.

CK Hutchison, now led by Li’s son Victor, is undergoing a major transformation, with the founding family seeking to sell long-held assets to build a war chest of at least US$41 billion. The shift mirrors a broader trend among Hong Kong’s traditional family-owned conglomerates, which are increasingly prioritising capital allocation and shareholder returns. It could also set the stage for transitioning into a new generation of leaders within the group.

The Li family’s cash-out plan has boosted liquidity, reducing net debt by 44% to HK$63.7 billion from the end of 2025. Cash and equivalents rose 25% to HK$179 billion.

The company reported a 7% increase in underlying profit at HK$12.6 billion.

Still, the group will remain focused on cost management and maintain a disciplined capital allocation approach in the face of challenges including the Iran war, inflation pressure and weaker outlook for the global economy, chairman Victor Li said in a statement.

“The changing global landscape has been marked by increasingly unpredictable geopolitical developments,” with climate challenges and rapid technology development redefining business models, creating new opportunities and risks, Li said in a separate statement.

CK Hutchison has completed a US$5.8 billion (RM23.69 billion) sale of its stake in the UK’s largest mobile operator to Vodafone Group plc, and continues to explore sale or spin-offs of telecom assets in Italy, Sweden, Denmark and Australia.

Earlier this year, the company and its affiliates agreed to sell the UK’s largest power distribution network for about US$14 billion. It also disposed of British rolling stock leasing firm Eversholt Rail. The two deals have recognized gains attributable to shareholders totaling HK$17.8 billion.

The group is also mulling an initial public offering of its retail arm AS Watson Group, which could raise at least US$2 billion. It’s in talks to sell the majority of its global ports for at least US$19 billion in cash, although the deal has dragged on having gotten entangled in US-China rivalry, especially in Latin America, where two terminals near the strategic Panama Canal have become a geopolitical flashpoint.

CK Hutchison also benefitted from its roughly 17% stake in Canadian oil company Cenovus Energy Inc, which saw output surge as the Iran war disrupted global energy supply and boosted demand for alternatives outside of the Middle East. The company’s share of Cenovus’ operating profit more than doubled to HK$8.8 billion from a year ago.

The group also saw strength in its key businesses including health-and-beauty retail, supported by resilient demand across major European and Asian markets.

The Li family’s property arm CK Asset Holdings Ltd reported a 38% increase in net income during the first half to HK$8.7 billion, driven primarily by the disposal of its UK joint ventures.

Hong Kong, the company’s primary property market, is seeing a broader recovery in its prime office sector after years of sluggish demand and elevated vacancies. A strengthening economy, and improving financial market conditions are driving financial firms to expand and upgrade their corporate footprints. 

Occupancy at the 41-storey Cheung Kong Center II building has more than doubled to about 60% since the start of this year, expecting to achieve at least 75% occupied by the year-end, Bloomberg reported earlier citing people familiar with the matter.

The firm also recognized a HK$6 billion impairment loss on a real estate investment trust with holdings across hotels, serviced suits, office, and retail properties in mainland China.

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