Ubs Securities·2026-03-17 09:40Investment Rating - The report assigns a "Neutral" rating to Swire Properties (00019) with a target price of HKD 72.7 [1] Core Insights - Swire Properties reported a 5% year-on-year increase in recurring core profit to HKD 9.8 billion, which was 4% lower than the bank's forecast, primarily due to weaker-than-expected contributions from the beverage business [1] - The company announced a 13% year-on-year increase in annual dividend per share to HKD 3.8, which was unexpected and indicates a payout ratio of 53% of recurring core profit, projected to be 51% in 2024 [1] - Management reiterated a progressive dividend policy based on the recovery of the aviation business over the past five years, expecting the payout ratio to remain above 50% of recurring core profit, with annual single-digit growth in dividend per share [1] - The net debt ratio is expected to improve from 22.1% in December 2024 to 20.6% at the end of last year [1] - The report anticipates an 8% year-on-year growth in underlying EBITDA, benefiting from the inclusion of beverage business performance from Thailand and Laos starting October 2024 [1] - Dividend income from joint ventures and associates is expected to increase by 3%, mainly reflecting the dividend distribution from Cathay Pacific [1] - The report projects continued improvement in cash flow for Swire Properties this year [1]