CK Hutchison Profit Plunges 92% on One-Off Loss From Merger

By Shirley Zhao and Shawna Kwan (Bloomberg) —

CK Hutchison Holdings Ltd.’s profit fell 92% in the first half of the year, due to a one-time and non-cash loss on account of the merger of its telecommunications arm with Vodafone Group Plc.

Billionaire Li Ka-shing’s flagship firm reported HK$852 million ($109 million) in net income for the six months ended June. Revenue came in at HK$240.7 billion, compared with HK$232.6 billion a year earlier. It announced an interim dividend of HK$0.710 per share, compared with HK$0.688 per share a year before.

The profit drop is the biggest since a group-wide restructuring in 2015 for CK Hutchison, which is now led by Li’s son Victor Li. While its main operations including ports and retail remain resilient — with underlying profit actually rising 11% from the year before — the company recorded a one-time, non-cash loss of HK$10.5 billion arising from the UK merger, including non-cash disposal loss and transactional related expenses. 

The group completed the merger in May, receiving about £1.3 billion ($1.8 billion) in net proceeds, it said in an earnings statement Thursday.

The conglomerate has also been facing geopolitical headwinds. It missed a chance to complete a sale of 43 ports — including two in the strategic Panama Canal — to a consortium backed by American asset manager BlackRock Inc. before a window for exclusive talks expired late July.

CK Hutchison said it may invite a major strategic investor from China to join the buyers group after Beijing expressed strong displeasure over the deal, which it sees as ceding its shipping and trade interest to US influence. State-owned China Cosco Shipping Corp. was negotiating a powerful role for itself as a condition to join the consortium, Bloomberg News reported in July.

The company didn’t mention the ports deal in its earnings statement Thursday. The group is poised to gain more than $19 billion in cash if the agreement is completed. The buying consortium also includes Italian billionaire Gianluigi Aponte’s Terminal Investment Ltd.

“Geopolitical uncertainty is likely to remain elevated,” said Chairman Victor Li. “The global economic outlook in this half will continue to be uncertain and unpredictable, with persistent unresolved trade and fiscal and monetary policy issues affecting commodity prices, interest and currency rates, as well as consumer and business sentiment.”

Merger Activity

CK Hutchison has been active in mergers and acquisitions in recent months — with mixed results. Subsidiary CK Infrastructure Holdings Ltd. has been seeking to bolster its UK assets after completing a second listing in London last year, but pulled out of the bidding for a liquefied natural gas terminal in the country valued at about £2 billion, Bloomberg News reported this week.

The company didn’t specify the reasons for its decision, which came after it said it was negotiating the final terms of a deal. An agreement was expected within days.

CK Infrastructure has been in talks to sell British rolling stock leasing firm Eversholt Rail for as much as £4 billion and expressed interest earlier this year in investing in debt-saddled Thames Water, though that didn’t develop into a “progressable proposal,” according to the water and sewage company’s management. The unit was also considering a bid for KKR & Co.-backed UK waste management firm Viridor Ltd., Bloomberg News reported in March.

Details on sectoral performance:

• The company reported a 9% increase in revenue at its ports and related services business, while earnings before interest, taxes, depreciation and amortization rose 10%
  • The improved performance was mainly driven by higher throughput from facilities in mainland China, Asia and the Middle East, as people rushed to stock up on goods before US President Donald Trump’s tariffs were expected to kick in. That’s also led to concerns for potentially slowing demand in the second half of the year
• CK’s property arm CK Asset Holdings Ltd. reported a 27% decline in net income during the first half to HK$6.3 billion
  • The company is set to face persistent pressure from Hong Kong’s weak office rental market, with the city’s office vacancy rate hovering near the record-high level at more than 17% in June, according to Colliers International
  • CK Asset still hasn’t filled its new central office tower, Cheung Kong Center II, limiting its rental income. Lackluster demand combined with high apartment supply will continue to weigh on home prices in Hong Kong, and developers including CK Asset will likely have to price upcoming projects relatively low to attract buyers

© 2025 Bloomberg L.P.

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