Hong Kong’s MTR Corporation has announced a significant increase in profits for the first half of 2024, reporting a net profit of HK$6 billion. This marks a nearly 45 per cent year-on-year growth, attributed to a revival in ridership and a surge in property income.
**Ridership Recovery and Revenue Growth**
The MTR Corporation revealed that the number of passengers rose by 4.1 per cent to 957 million people in the initial six months of 2024. This increase can be primarily attributed to a substantial rise in individuals utilizing cross-boundary services and high-speed rail connections with mainland China, as outlined in a mid-year report released on Thursday.
The recovery in ridership played a crucial role in turning around the financial performance of the transport operations. From a loss of HK$774 million in the first half of 2023, the corporation managed to achieve a profit of HK$415 million during the same period this year.
**Property Development Profits**
Apart from the resurgence in ridership, the MTR Corporation also witnessed robust growth in property development profits. There was a notable 142 per cent increase to HK$1.7 billion, driven by successful property projects such as Southside in Wong Chuk Hang and new developments at Lohas Park.
Financial director Michael Fitzgerald acknowledged that while the net profit of HK$6 billion does not signify a complete return to pre-pandemic levels, it does demonstrate a substantial improvement over the previous year.
**Future Financial Management and Expansion Plans**
CEO Jacob Kam emphasized the corporation’s commitment to exercising prudent financial management to ensure sustainable development. He mentioned an upcoming investment of over HK$100 billion for railway construction, indicating a strong focus on expanding the railway network and maintaining high-quality services amidst evolving market dynamics and increased competition.
Kam stated, “We are adopting a forward-looking approach to consolidate our financial strength, ensuring we have sufficient financial resources to expand our railway network and maintain high-quality services amidst the new normal and increased competition.”
**Community Benefits and Development Projects**
Addressing concerns about offering more ticket concessions to residents in light of increased profits, Kam highlighted that the MTR Corporation has been providing discounts and concessions periodically and will continue to do so. He also mentioned that the corporation is exploring the feasibility of establishing a new station along the East Rail Line in response to a newly-unveiled development project in Pak Shek Kok, which is set to offer approximately 10,000 residential units.
David Tang, the property and international business director of the MTR Corporation, indicated that a preliminary report on this matter could be anticipated by the end of the year.
**Dividends and Government Ownership**
The proposed interim dividend stands at 42 cents per share. It is noteworthy that the government holds a majority stake in the MTR Corporation, which operates independently on a commercial basis.
In conclusion, the MTR Corporation’s mid-year results for 2024 reflect a notable financial turnaround, with substantial profits driven by a resurgence in ridership and robust property development earnings. The corporation’s strategic focus on financial management, sustainable growth, and community benefits positions it well for continued success in the evolving transportation landscape of Hong Kong.