Jardine Matheson Holdings (JMH) and Jardine Strategic Holdings (JSH) reported 32% and 35% lower earnings to US$1.085 billion and US$1.094 billion for the FY2020 ended December, from earnings of US$1.589 billion ($1.46 billion) and US$1.681 billion a year ago.
This was mainly due to the negative impact of the Covid-19 pandemic, which affected businesses in Southeast Asia, Astra and Jardine Cycle & Carriage (JC&C), and Mandarin Oriental.
Astra’s business in Indonesia, as well as JC&C’s motor and other interests across Southeast Asia saw lower profit contributions from most of their divisions. Meanwhile, Mandarin Oriental suffered due to the travel restrictions that were imposed during the year.
Earnings per share (EPS) for the FY2020 stood 30% lower y-o-y to US$2.95 and 34% lower y-o-y to US$1.96 for JMH and JSH respectively.
JMH reported FY2020 underlying profit of US$2.79 billion, 40% lower y-o-y, while revenue for the group stood 20% lower y-o-y at US$32.65 billion.
For the FY2020, JSH saw 42% lower underlying profit of US$2.61 billion compared to the year before, while revenue stood 21% lower y-o-y at US$25.78 billion.
JMH has declared a final dividend of US$1.28 per share, unchanged from the year before, bringing the full-year dividend to US$1.72 per share, also unchanged from FY2019.
JSH, on the other hand, has chosen not to declare or pay any dividend due to the proposed acquisition and implementation agreement with JMH.
Hongkong Land saw “solid performance” from its Investment Properties business, though it registered 11% lower underlying profit of US$963 million compared to the year before.
Dairy Farm similarly registered strong performances from its Grocery Retail and Home Furnishings business, with 14% lower underlying profit at US$276 million compared to the FY2019.
See: Dairy Farm sees 14% drop in earnings of US$276mil for FY20
Jardine Pacific saw 11% y-o-y higher underlying profit of US$182 million led by higher contribution from JEC, which saw stable performance in its Hong Kong operations.
JMH’s Motors business registered 9% growth y-o-y of US$214 million benefitting from higher contribution from the investment in Zhongsheng in the 2HFY2019 and 1HFY2020.
Mandarin Oriental saw underlying loss of US$206 million compared to underlying profit of US$41 million in FY2019 due to the pandemic.
JC&C’s underlying profit plunged 50% y-o-y to US$429 million. Non-trading items in 2020 included a US$188 million gain on the disposal of Astra’s investment in Permata Bank and US$109 million unrealised fair value gains related to non-current investments.
Astra’s net profit stood 26% lower y-o-y at 16.2 trillion rupiah or US$1.1 billion. Excluding the one-off gain from the sale of its investment in Permata Bank, the group’s net income would have dropped 53% y-o-y to 10.3 trillion rupiah or US$0.7 billion.
Looking ahead, the group says it expects 1HFY2021 to be affected by the ongoing impact of the pandemic, including low levels of tourists from the Chinese mainland and other visitors to Hong Kong.
“There is continued robust economic activity on the Chinese mainland, but it is uncertain whether this will be maintained. It remains too soon to predict what the impact of the pandemic will be on the group’s performance for the full year,” it says in a March 11 statement.
In the same statement, JMH revealed that its other businesses are forging new partnerships with digital innovators including JD Technology and Gojek.
“It remains too soon to predict what the impact of the pandemic will be on the group’s performance for the full year. However, we remain confident in our long-term strategy, rooted in the growth markets of Asia, and we will continue to focus on our core priorities of driving operational excellence, evolving the group’s portfolio and finding new growth opportunities, in order to deliver long-term value,” says group managing director John Witt.
“The resilience the group demonstrated in 2020 provides the Board with the confidence to continue to take advantage of long-term opportunities in Asia, while adapting to the changing external environment and rapidly evolving expectations of our stakeholders… As announced separately on 8th March, we are taking the important step of simplifying our parent company structure – a move that will create value for our shareholders and increase the group’s operational and financial flexibility. This is further proof that, even in these turbulent times, Jardines is always moving forward and strengthening our ability to grow and prosper,” says executive chairman Ben Keswick.
See also: Jardine Matheson Holdings to acquire remaining stake in Jardine Strategic for US$5.5 bil; Jardine Strategic shareholders to receive US$33 per share and Jardine minority shareholders oppose US$1 bil 'discount' in buyout plan
Shares in JMH closed 81 US cents higher or 1.3% up at US$65.57, while shares in JSH closed 5 US cents higher or 0.2% up at US$32.86 on March 11.
