What surprised us
Underpinned by higher occupancy at Hysan Place offices (which reached full occupancy since Sep 2013 vs. 69% in Jun 2013) and continued positive rental reversion at its commercial portfolio, Hysan saw a 4.7% yoy increase in 1H FY14 underlying profit to HK$1,082mn (HK$1.0172/share), in line with our forecast of HK$1,064mn. Net property income was 8% better than our estimate (thanks to better-than-expected rental rates at its office portfolio and occupancy rates at select retail properties), although this was partly offset by higher-than-expected finance costs and taxation charges. The board declared 1H DPS of HK$0.23, up 4.5% from last year’s HK$0.22. BVPS was up 3.0% from end-2013 to HK$61.31, thanks to a 3.1% rise in investment property valuation.