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hi ghchua,
The actual PR has more color on the grand plan. Superficially reading it - somehow many things don't reconcile though.
(1) HKL aims to double dividend per share in 10years - which means annualized 7.2% increase in dividend. But it also says it aims to deliver mid-single digit growth in dividend per share - ie. 5% and including SBB reducing share count. That doesn't line up.
(2) Double existing 40bil AUM to 100bil AUM by 2035, while recycling existing 10bil asset. If we exclude the debt embedded within that 10bil figure and assume a 20% GP : 80% LP kind of ownership, 10bil divestments will attract another 40bil to have total 50bil --> 80bil AUM. And with partial stake sales in their remaining core 30bil, 100bil AUM looks much achievable without any M&A. So while all these looks achievable in theory (unlike the dividend per share I mentioned above), but whether is it achievable in practice is probably another question. Let's see how they start assembling their team!
New strategic direction
An estimated US$6bn in proceeds will be generated from the winddown of the build-to-sell segment. A further US$4bn will come from the recycling of selected IP assets.
The aim is to deliver mid-single digit annual growth in dividends per share. As capital is recycled into cash, up to
20% of the proceeds may, subject to market conditions, be invested in the buy-back of shares where returns on
investment exceed our weighted average cost of capital.
This strategy is not expected to require an increase in group net debt or funding from shareholders, whilst
preserving our investment grade credit-rating.
https://links.sgx.com/FileOpen/HKLH1029....eID=823339
The actual PR has more color on the grand plan. Superficially reading it - somehow many things don't reconcile though.
(1) HKL aims to double dividend per share in 10years - which means annualized 7.2% increase in dividend. But it also says it aims to deliver mid-single digit growth in dividend per share - ie. 5% and including SBB reducing share count. That doesn't line up.
(2) Double existing 40bil AUM to 100bil AUM by 2035, while recycling existing 10bil asset. If we exclude the debt embedded within that 10bil figure and assume a 20% GP : 80% LP kind of ownership, 10bil divestments will attract another 40bil to have total 50bil --> 80bil AUM. And with partial stake sales in their remaining core 30bil, 100bil AUM looks much achievable without any M&A. So while all these looks achievable in theory (unlike the dividend per share I mentioned above), but whether is it achievable in practice is probably another question. Let's see how they start assembling their team!
New strategic direction
An estimated US$6bn in proceeds will be generated from the winddown of the build-to-sell segment. A further US$4bn will come from the recycling of selected IP assets.
The aim is to deliver mid-single digit annual growth in dividends per share. As capital is recycled into cash, up to
20% of the proceeds may, subject to market conditions, be invested in the buy-back of shares where returns on
investment exceed our weighted average cost of capital.
This strategy is not expected to require an increase in group net debt or funding from shareholders, whilst
preserving our investment grade credit-rating.
https://links.sgx.com/FileOpen/HKLH1029....eID=823339
I am not a certified financial advisor and so nothing of what I say should be construed as financial advice. Please consult a certified financial advisor for advice instead.