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Mon, May 01, 2006 - Page 10 News List

Wharf foresees revenues from China after 2007


Ports-to-property conglomerate Wharf Holdings Ltd says it plans to get a boost from China's booming economy while keeping its solid foothold in Hong Kong.

The company expects revenue to start flowing in from Chinese property and port operations after next year as new projects come on stream, chief financial officer Peter Mak said.

"Most of our China projects are still under development," Mak said. "Contributions are relatively low at the moment. But when projects materialize ... [their] contribution will gradually increase," Mak told Dow Jones Newswires in a recent interview.

Mak said he expects the contribution from Chinese property to account for 10 percent of the group's total revenue -- three to five years after completion of new projects next year and in 2008 -- up from the current 5 percent.

Wharf posted revenue of HK$12.5 billion (US$1.61 billion) for the year ended Dec. 31, up 5 percent on year.

The company, which owns the Times Square office-to-retail developments in Beijing, Shanghai and Chongqing, is expected to complete Times Square projects in Wuhan and Dalian next year. Two new residential projects in Shanghai are scheduled for completion in the next two years.

The company's investment in China, mainly earmarked for property and ports, will exceed HK$10 billion over the next seven years, excluding outlay for additional new projects, Mak said.

Wharf will also search for land acquisition opportunities in cities such as Dalian, Chongqing and Chengdu, where large-scale land reserves are more easily available at reasonable prices, he added.

In Hong Kong, the company operates the Times Square and Harbour City retail-to-office complexes and the Ocean Terminal shopping mall, all in major tourism districts.

But in 2004, Hong Kong's government decided it would not immediately renew Wharf's lease for Ocean Terminal, which expires in 2012.

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