First Pacific Company Limited

First Pacific said 2025 turnover rose 2% to a little over $10 billion. Recurring profit increased 10% to $740 million from about $673 million in 2024, and net profit rose 10% to a record $661 million. The board approved a final dividend of HKD 0.14 per share, taking the full-year distribution to HKD 0.27 per share, the highest ever on a per-share basis. Head office dividend income was about HKD $311 million; interest coverage was 4.5x in 2025 versus 4.0x the prior year; and average borrowing cost was about 4.6% with average maturity of about 3.2 years. On the balance sheet, management said no borrowings fall due until September 2027, when a $350 million bond matures, and a $200 million 2026 loan has already been refinanced to 2031. For 2026, management suggested the year should be “rather better” than 2025 in general, but said the outlook depends on developments in the Middle East and related supply/rate effects.

Executive Director Christopher Young said the 2025 results continued a seven-year trend of improvement and that the group’s businesses remain largely defensive because they are consumer-facing. He emphasized that Indofood’s outlook looks reasonable, though it is still subject to uncertainty from the Middle East, and said dividend decisions at Indofood are typically made through constructive discussion with management based on growth and outlook. His tone was positive but measured, repeatedly stressing caution around the short- to medium-term environment.

Joseph Ng focused on capital return, leverage, and funding flexibility. He said the regular distribution grew 6% year over year, or about 10% including the Maynilad-related special distribution, and that the payout is returning more than 70% of free cash after head office expenses and interest while preserving some cash for PLP’s gas-plant equity needs. He also said the 2026 bank loan has already been refinanced, the next major maturity is the $350 million bond due in September 2027, and the firm is actively exploring refinancing options, with preference still for a bond if market pricing is acceptable. On rate risk, he said the head office debt mix is around 50% fixed and the company is comfortable with that balance given volatile rate expectations.

Analysts focused on why the final dividend growth looked muted, whether Indofood could lift its payout ratio, and how the Middle East conflict might affect raw material costs and PLP’s power margins. Management replied that the regular dividend was not weak: the full-year regular payout grew 6%, and total distribution including the Maynilad special was about 10%, broadly matching recurring profit growth. On Indofood, management said dividend discussions are constructive and will reflect 2025 profit growth of 1% and the 2026 outlook, while on PLP they said gas supply disruption from the Middle East is manageable near term but too early to judge for margins or pricing. They also explained that PLP’s new gas project is targeted to start operating in 2029, with notice-to-proceed expected this year and CapEx spread over the next few years.