Hutchison Profit Rises 20% on Expanding Europe Mobile Business

Hutchison Whampoa Ltd. (13), controlled by Asia’s richest man Li Ka-shing, said full-year profit rose 20 percent as it benefited from growth in its expanding mobile phone business in Europe. Net income advanced to HK$31.1 billion ($4 billion) in 2013, from HK$25.9 billion a year earlier, the company said in a statement to the Hong Kong stock exchange today. That matched the average of seven analyst estimates compiled by Bloomberg. Hutchison, with interests in retail, ports and telecommunications, is expanding in Europe and North America while seeking to sell assets in Hong Kong and China, where long-term economic growth is slowing. Li in August said the company will increase its phone market share in Europe. “Cash flow from its mobile business, especially from Europe, has improved a lot,” Kenny Tang, Hong Kong-based general manager of AMTD Financial Planning Ltd. said before the earnings announcement. “The company will also benefit from the recovery in Europe. Businesses in port, retail and the overall economy have improved a lot.” Recurring earnings rose 17 percent to HK$31 billion, compared with the HK$29.7 billion average of 13 estimates. Hutchison Whampoa was unchanged at HK$103.60 at the noon-day break. The stock is down 1.7 percent this year, compared with the 2.3 percent loss in the benchmark Hang Seng Index. Earnings from 3 Group Europe before interest, taxes, depreciation and amortization rose 38 percent HK$12.7 billion. The retail division, which runs groceries, health and beauty stores including ParknShop, posted earnings that rose 11 percent to HK$14.2 billion.

Retail IPO

Hutchison has picked Bank of America Corp., Goldman Sachs Group Inc. and HSBC Holdings Plc to work on an initial public offering of its retail arm, two people with knowledge of the matter toldBloomberg News in December. A.S. Watson & Co., which runs stores including groceries and pharmacies in 33 markets, would be valued at more than $20 billion in an IPO, said one of the people. Hutchison agreed in June to buy O2, Ireland’s No. 2 mobile operator, for as much as 850 million euros ($1.2 billion). The company last July also said it is seeking more telecom assets in Italy, after agreeing the month before to buy Telefonica SA’s Irish unit for as much as $1.1 billion. Hutchison is trying to attract more third and fourth-generation mobile users in Hong Kong as it contends with China Mobile Ltd. (941) and SmartTone Telecommunications Holdings Ltd. (315). Source:  http://www.bloomberg.com/news/2014-02-28/hutchison-profit-rises-20-on-expanding-europe-mobile-business.html