EGANA JEWELLERY<00926> - Results Announcement
Egana Jewellery & Pearls Limited announced on 14/09/2005:
(stock code: 00926 )
Year end date: 31/05/2005
Currency: HKD
Auditors' Report: Unqualified
(Audited )
(Audited ) Last
Current Corresponding
Period Period
from 01/06/2004 from 01/06/2003
to 31/05/2005 to 31/05/2004
Note ('000 ) ('000 )
Turnover : 851,352 977,633
Profit/(Loss) from Operations : 94,409 85,927
Finance cost : (25,515) (22,448)
Share of Profit/(Loss) of
Associates : N/A N/A
Share of Profit/(Loss) of
Jointly Controlled Entities : N/A N/A
Profit/(Loss) after Tax & MI : 74,552 68,495
% Change over Last Period : +9 %
EPS/(LPS)-Basic (in dollars) : 0.2027 0.2200
-Diluted (in dollars) : N/A 0.2138
Extraordinary (ETD) Gain/(Loss) : N/A N/A
Profit/(Loss) after ETD Items : 74,552 68,495
Final Dividend : 1.85 cents 4 cents
per Share
(Specify if with other : N/A N/A
options)
B/C Dates for
Final Dividend : 14/11/2005 to 16/11/2005 bdi.
Payable Date : 16/12/2005
B/C Dates for Annual
General Meeting : 14/11/2005 to 16/11/2005 bdi.
Other Distribution for : N/A
Current Period
B/C Dates for Other
Distribution : N/A
Remarks:
1. Basis of preparation and accounting policies
The accounts have been prepared in accordance with accounting principles
generally accepted in Hong Kong and comply with accounting standards
issued by the Hong Kong Institute of Certified Public Accountants ("
HKICPA"). They have been prepared under the historical cost convention as
modified by the revaluation of certain leasehold land and buildings and
investments in non-trading and trading securities.
The HKICPA has issued a number of new or revised Hong Kong Financial
Reporting Standards ("HKFRS") and Hong Kong Accounting Standards ("HKAS")
(collectively referred to as "new HKFRSs") which are effective for
accounting periods beginning on or after 1st January, 2005.
In the year, the Group has adopted the following new HKFRSs:
HKAS 36 Impairment of Assets
HKAS 38 Intangible Assets
HKFRS 3 Business Combinations
The effect of adopting these new HKFRSs is set out below:
(a) Trademarks
On the first time adoption of the new HKFRSs, the Group reassessed the
useful lives of previously recognised intangible assets. As a result of
this assessment, the acquired trademarks of the Group were classified as
indefinite-lived intangible assets in accordance with HKAS 38. This
conclusion is supported by the fact that the trademarks legal rights are
capable of being renewed indefinitely at insignificant cost and therefore
are perpetual in duration. In addition, as the trademarks are related to
well known and long established luxury and fashion consumer brands, based
on the expected future financial performance of the Group, they are
expected to generate positive cash flows indefinitely. This view is
supported by LCH (Asia-Pacific) Surveyors Limited, an independent
professional valuer, who has been appointed by the Group to perform an
assessment of the useful lives of the trademarks in accordance with the
requirements set out in HKAS 38. Having considered the factors specific to
the Group, the valuer considered that the trademarks should be regarded as
an intangible asset with an indefinite useful life. Since 1st June, 2004,
the amortisation of trademarks has been discontinued and accordingly, the
Group's profit for the year ended 31st May, 2005 was increased by
approximately HK$738,000. Such change was accounted for as a change in
accounting estimate which was reflected in the accounts prospectively.
Under HKAS 38, the Group re-evaluates the useful lives of the trademarks
each year to determine whether events or circumstances continue to support
the view of indefinite useful life for the assets.
(b) Goodwill
Since 1st June, 2004, amortisation of positive goodwill has been
discontinued and the related accumulated amortisation brought forward was
transferred and eliminated against the cost of the goodwill. As a result,
the Group's profit for the year ended 31st May, 2005 was increased by
approximately HK$6,740,000.
(c) Negative Goodwill
The carrying amount of negative goodwill previously recognised prior to 1
st June, 2004, including that credited to the goodwill reserve, has been
credited to the opening balance of retained profits. As a result, the
Group's opening retained profits as at 1st June, 2004 was increased by
approximately HK$81,963,000 with the corresponding decrease in the
goodwill reserve of approximately HK$81,963,000.
The Group has not early adopted other new HKFRSs except for those
mentioned above in the accounts for the year ended 31st May, 2005.
The Group has already commenced an assessment of the impact of other new
HKFRSs but is not yet in a position to state whether these new HKFRSs
would have a significant impact on its results of operations and financial
position.
2. Earnings per share
Basic earnings per share
The basic earnings per share was calculated based on the consolidated
profit attributable to shareholders for the year of approximately
HK$74,552,000 (2004: HK$68,495,000) and the weighted average number of
ordinary shares of approximately 367,754,000 (2004: 311,372,000) in issue
during the year.
Diluted earnings per share
During the year ended 31st May, 2005, the Company's share options exercise
price was above the average fair value of one ordinary share, thus there
were no dilutive potential ordinary shares.
During the year ended 31st May, 2004, diluted earnings per share was
calculated based on the adjusted consolidated profit attributable to
shareholders for the year of approximately HK$68,727,000 and the weighted
average number of ordinary shares of approximately 321,390,000 that would
be in issue having adjusted for the effects of all dilutive potential
ordinary shares issuable during the year.
Reconciliation
i) A reconciliation of profit attributable to shareholders used in
calculating the basic and diluted earnings per share was as follows:
For the year For the year
ended ended
31st May, 31st May,
2005 2004
HK$'000 HK$'000
Profit attributable to shareholders
used in calculating basic earnings
per share 74,552 68,495
Interest savings in respect of
convertible bonds - 232
--------- --------
Profit attributable to shareholders
used in calculating diluted earnings
per share 74,552 68,727
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ii) A reconciliation of the number of ordinary shares for calculation
of basic and diluted earnings per share was as follows:
For the year For the year
ended ended
31st May, 31st May,
2005 2004
Weighted average number of ordinary
shares used in calculating basic
earnings per share 367,754,000 311,372,000
Dilutive potential effect in respect
of convertible bonds - 10,018,000
------------- -------------
Weighted average number of ordinary
shares used in calculating diluted
earnings per share 367,754,000 321,390,000
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