Underlying profit up: Sino Land

Sino Land Co, the best-performing stock in Hong Kong's property index over the past 12 months, said full-year underlying profit rose 21 percent after rental income rose and as it sold commercial property assets.

Profit excluding increases in real estate values grew to HK$5.31 billion ($685 million) for the year ended June 30 from HK$4.4 billion a year earlier, Sino Land said in a Hong Kong Stock Exchange statement on Wednesday. That compares with the median estimate of HK$5.3 billion of 13 analysts surveyed by Bloomberg.

The developer, controlled by billionaire Robert Ng, and peers have in the past year accelerated sales of commercial properties in Hong Kong, the world's most expensive place to buy a home and to rent office space. Earnings at Sino Land, almost all derived from Hong Kong, also were fueled after the builder booked profits from home sales in the previous fiscal year.

Dongfeng Motor H1 net falls 8.4%

Dongfeng Motor Group Co, which produces cars with Nissan Motor Co in China, reported first-half profit that missed analysts' estimates, as falling truck demand eroded gains from passenger-vehicle sales.

Net income fell 8.4 percent to 5.37 billion yuan ($845 million) in the six months ended June 30, the Wuhan-based company said in a statement to the Hong Kong stock exchange on Wednesday. Sales rose 6.8 percent to 68.1 billion yuan.

Profit was 9 percent lower than the average estimate of five analysts surveyed by Bloomberg. Nationwide demand for commercial vehicles has declined as the economy expanded at the weakest pace in three years. Truck sales at Dongfeng slumped 26 percent in the first half, more than the 10 percent industry-wide decline, according to China Association of Automobile Manufacturers data.

China Southern to fly A380s to Paris

China Southern Airlines Co will fly Airbus SAS A380s on a Beijing-Paris route beginning in October, ending a year-long wait to use superjumbos on international services from the country's capital.

The Paris route, which will require two A380s, will be operated with Air China Ltd, China Southern Chief Financial Officer Xu Jiebo said by phone on Wednesday. The terms of the agreement with Air China are still being discussed, he said.

Using A380s on international routes may help China Southern narrow losses from the planes' operation, Citigroup analyst Vivian Tao wrote in a note to clients on Tuesday. China Southern has so far only used the aircraft domestically because of delays in getting regulatory approval for overseas routes.

China Southern, the nation's only A380 operator, will also begin flying superjumbos from its hub in Guangzhou, southern China to Los Angeles in October. The carrier has three A380s in service, with a fourth coming next month and the final one in January, Xu said.

HK stocks fall to three-week low

Hong Kong stocks fell, with the city's benchmark index dropping to a three-week low, on concerns mainland may slow the pace of monetary policy easing and corporate earnings are deteriorating.

Industrial & Commercial Bank of China Ltd, the world's biggest lender by market value, dropped 1.4 percent a day before reporting earnings. Evergrande Real Estate Group Ltd, mainland's biggest developer by sales volume, slid 3.1 percent after reporting a 21 percent drop in its first-half underlying profit.

The Hang Seng Index fell 0.1 percent to 19788.51, the lowest close since Aug 3.

The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong lost 0.5 percent to 9470.46.

Agencies

(HK Edition 08/30/2012 page2)