Sept. 12 (Bloomberg) -- SmarTone Telecommunications Holdings Ltd., a unit of Sun Hung Kai Properties Ltd., fell the most in almost two years in Hong Kong trading after the company posted an earnings decline and announced dividend cut.
Shares of the telecom service provider slumped as much as 16 percent, the biggest drop since September 22, 2011, with a trading volume more than 10 times the three-month average. The benchmark Hang Seng Index rose 0.3 percent.
Smartone’s net income for the year ended June 30 plunged 18 percent to HK$843 million, the first decrease since 2009. The company, one of the authorized mobile carriers for Apple Inc.’s iPhone in Hong Kong, will cut its dividend ratio to 60 percent of net income in the future because of regulatory and market uncertainties, it said in a statement yesterday.
The cut “definitely makes those who like the company because of the generous dividend payout upset,” said Victor Yip, analyst at UOB-Kay Hian Ltd., who downgraded the stock to sell from buy today. “For people who like the company because of the growth story, they know that at least in the next 12 months, the earnings are not likely to show a positive growth.”
To contact the reporter on this story: Billy Chan in Hong Kong at email@example.com
To contact the editor responsible for this story: Grant Clark at firstname.lastname@example.org