SHIMAO INT'L<00649> - Results Announcement
Shimao International Holdings Limited announced on 15/09/2005:
(stock code: 00649 )
Year end date: 31/12/2005
Currency: HKD
Auditors' Report: N/A
Interim report reviewed by: Audit Committee
(Unaudited )
(Unaudited ) Last
Current Corresponding
Period Period
from 01/01/2005 from 01/01/2004
to 30/06/2005 to 30/06/2004
Note ('000 ) ('000 )
Turnover 2 : 6,061 3,423
Profit/(Loss) from Operations : 4,882 (8,268)
Finance cost : (2,703) (1,358)
Share of Profit/(Loss) of
Associates : 8,849 108,491
Share of Profit/(Loss) of
Jointly Controlled Entities : N/A N/A
Profit/(Loss) after Tax & MI : 9,179 98,019
% Change over Last Period : -90.6 %
EPS/(LPS)-Basic (in dollars) 3 : 0.0111 0.1184
-Diluted (in dollars) : N/A N/A
Extraordinary (ETD) Gain/(Loss) : N/A N/A
Profit/(Loss) after ETD Items : 9,179 98,019
Interim Dividend : Nil Nil
per Share
(Specify if with other : N/A N/A
options)
B/C Dates for
Interim Dividend : N/A
Payable Date : N/A
B/C Dates for (-)
General Meeting : N/A
Other Distribution for : N/A
Current Period
B/C Dates for Other
Distribution : N/A
Remarks:
1 Principal accounting policies
(a) Basis of preparation and accounting policies
The unaudited condensed interim financial information has been prepared in
accordance with the applicable disclosure provisions of the Rules
Governing the Listing of Securities on The Stock Exchange of Hong Kong
Limited and in compliance with Hong Kong Accounting Standard ("HKAS") 34
"Interim Financial Reporting" issued by the Hong Kong Institute of
Certified Public Accountants.
The accounting policies used in the preparation of the unaudited condensed
interim financial information are consistent with those used in the annual
accounts for the year ended 31st December 2004, except that the Group has
changed certain of its accounting policies following its adoption of new
and revised Hong Kong Financial Reporting Standards and Hong Kong
Accounting Standards ("new HKFRSs") which are effective for accounting
periods commencing on or after 1st January 2005.
(b) Changes in accounting policies
The adoption of the following HKFRSs, which include all HKASs and
applicable Interpretations ("HKAS-Ints" and "HK-Ints"), that necessitates
material changes in accounting policies or presentations of financial
information are summarised as follows:
(i) The adoption of HKAS 1 "Presentation of Financial Statements" has
affected the presentation of share of net results after tax of an
associated company.
(ii) The adoption of HKAS 17 "Leases" has resulted in a change in
accounting policy relating to leasehold land which was previously included
in fixed assets and completed properties held for sale and carried at cost
less accumulated depreciation and impairment and the lower of cost and net
realisable value, respectively. In accordance with the provisions of
HKAS 17, the leasehold land is regarded as operating leases and the lease
premium and other costs for acquiring the leasehold land are amortised
over the terms of the leases. The adoption of HKAS 17 does not have any
material effect to the Group.
(iii)The adoption of HKFRS 3 "Business Combinations" and HKAS 36
"Impairment of Assets" do not permit to amortise the goodwill on a
straight-line basis over a period of not exceeding 20 years. Also,
goodwill is tested annually for impairment, as well as when there are
indications of impairment. If the cost of acquisition is less than the
fair values of the net assets acquired, the difference is recognised
directly in the profit and loss account as negative goodwill.
(iv) The adoption of HKAS 40 "Investment Property" has resulted in a
change in the accounting policy whereby changes in fair values of
investment properties are recorded in the profit and loss account. In
prior years, the increases in fair value were credited to the investment
properties revaluation reserve. Decreases were first set off against
increases on earlier valuations on a portfolio basis and thereafter
expensed in the profit and loss account.
The adoption of HKAS 40 has been applied retrospectively, however, there
is no effect on the equity as at 1st January 2004 and 2005.
(v) The adoption of HKAS-Int 21 "Income Taxes - Recovery of Revalued Non
-Depreciable Assets" has resulted in a change in the accounting policy
relating to the measurement of deferred tax liabilities arising from the
revaluation of investment properties. Such deferred tax liabilities are
measured on the basis of tax consequences that would follow from recovery
of carrying amount of assets through use. In prior years, carrying amount
of assets was expected to be recovered through sale.
The adoption of HKAS-Int 21 has been applied retrospectively and
comparatives presented have been restated to conform to the changed
policy.
(vi) The adoption of HKAS 32 "Financial Instruments: Disclosure and
Presentation" and HKAS 39 "Financial Instruments: Recognition and
Measurement", has set up the basis for recognition, measurement,
derecognition and disclosure of financial instruments. Borrowings are
recognised initially at fair value net of transaction costs incurred and
subsequently stated at amortised cost. The fair value of the liability
component of a convertible note is determined using a market interest rate
for an equivalent non-convertible note and is recorded on an amortised
cost basis until extinguished on conversion or maturity of the note. The
remainder of the proceeds is allocated to the conversion option, which is
recognised and included in reserves as an equity component of a
convertible note.
(vii)The adoption of Hong Kong Interpretation ("HK-Int") 3 "Revenue - Pre
-completion Contracts for the Sale of Development Properties" has resulted
in a change in accounting policy relating to the recognition of revenue
from sales of properties under development in advance of completion. In
prior years, sales of properties under development in advance of
completion were recognised over the course of the development based on the
proportion of construction work completed or if lower, the proportion of
sales proceeds received. In accordance with HK-Int 3, sales of properties
are recognised when the risk and rewards of the property have been passed
to the customers.
2 Turnover
The Group is principally engaged in property investment and development of
property projects in Hong Kong and the Mainland China. Turnover comprises
gross income from rental operation and revenue from sales of properties.
Six months ended 30th June
2005 2004
HK$'000 HK$'000
Company and subsidiaries
Rental income 6,061 3,423
Share of an associated company
Sales of properties 30,962 293,212
------ -------
37,023 296,635
====== =======
3 Basic earnings per share
The calculation of basic earnings per share is based on the profit
attributable to shareholders of HK$9,179,000 (2004: HK$98,019,000)
and 827,640,000 (2004: 827,640,000) ordinary shares in issue during
the period.
There is no potential dilutive effect on the equity component of the
convertible note.
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