Pacific Century Regional Development (PCRD) has reported a 4.4 per cent drop in full-year net profit to $87 million.
The bottom line took a hit from a key telco unit in Hong Kong which delivered a solid though weaker set of results despite an increasingly challenging macroeconomic environment and intensified market competition.
The group's share of profit of associated companies net of tax in the 12 months ended Dec 31 was $82.7 million, down 7.9 per cent year on year owing mainly to lower takings from Hong Kong-listed telco PCCW - PCRD's most significant asset, in which it has a 22.7 per cent stake.
PCRD's share of profit from PCCW was $82.1 million last year, down from $89.6 million in 2015.
PCCW had reported a 2 per cent fall in consolidated revenue from a year ago to $6.8 billion on slower mobile handset sales, and a consolidated net profit of $364.6 million.
HKT, the 63 per cent unit of PCCW, also posted a 3 per cent fall in total revenue to $6 billion for the full year on lower mobile handset sales due to the absence of marquee handsets throughout 2016.
PCRD's group revenue, which relates to dividends received from HKT, was $13 million, up 13.1 per cent from a year ago. Total expenses last year amounted to $7.3 million, down 15.5 per cent from a year ago.
PCRD said that PCCW will continue to reinforce its leading position in telecommunications, media and IT solutions in Hong Kong.
It noted, however, that "the outlook for 2017 is overshadowed by global events, execution of the Brexit mechanism, and the change in leadership of the United States. Within Hong Kong, PCCW has yet to see a strong return of consumer and business confidence".
Meanwhile, PCRD said PCCW Solutions plans to grow by assisting its customers to become digital enterprises, acting as a gateway for them to expand their presence in mainland China and for mainland enterprises to expand globally. PCCW Solutions will also continue to enrich its cloud capabilities and expand its data centre infrastructure.
PCRD said PCCW's pay-TV service business will enrich its content offering and user interface.
PCCW's OTT (Over-the-top) business plans to raise customer awareness and engagement, broaden its library of locally relevant content and expand into selected new markets to capture opportunities arising from the changing viewing habits of customers.
AT A GLANCE
NET PROFIT: $87 million (-4.4%)
SHARE OF PROFIT FROM ASSOCIATED COMPANIES NET OF TAX: $82.7 million (-7.9%
PCCW's Free TV business has been well received by viewers and advertisers although it "remains cautious" towards the imminent entry of a new player, PCRD said.
PCRD's earnings per share was 3.283 cents, down from 3.362 cents a year earlier. Net asset value per share was 40.3 cents as at Dec 31, up from 35.8 cents a year earlier.
The results were posted after market close. The counter closed unchanged at 35.5 cents yesterday.