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<Research>JPM: MTR CORPORATION 2025 Results in Line; Low Visibility on Capital Expenditure for Northern Link Part 2
Recommend 5 Positive 9 Negative 1 |
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Yesterday (12th), MTR CORPORATION (00066.HK) announced its full-year results for the period ending December 2025, with profits down 4% YoY, meeting market expectations, according to JPMorgan's research report. Affected by one-off expenses and coupon payments on perpetual bonds, MTR CORPORATION's 2025 recurring profits fell by 22% YoY. Excluding one-off items, management guidance indicated that the decline in last year's recurring profits was only in single digits, and the 22% drop in recurring profits was partially offset by an 8% YoY increase in development project bookings. Overall, the results aligned with expectations. The report highlighted that capital expenditure for Northern Link Part 2 remains unclear. MTR CORPORATION's management guidance for capital expenditure from 2026 to 2028 is around HKD82.6 billion, with about 50% allocated to local railway maintenance, 37% to new local railway projects, 11% to local properties, and the remaining 2% to investments in Mainland China and overseas. However, the three-year capital expenditure guidance doesn't clarify the expenditure for Northern Link Part 2, which seems not to be included in the current financial planning, and capital expenditure may rise later in the 2020s. JPMorgan has rated MTR CORPORATION at Neutral with a target price of HKD29. AAStocks Financial News |
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