Listed Company Information
 

EGANA JEWELLERY<00926> - Results Announcement

Egana Jewellery & Pearls Limited announced on 16/02/2006:
(stock code: 00926 )
Year end date: 31/05/2006
Currency: HKD
Auditors' Report: N/A
Interim report reviewed by: Audit Committee
                                                        (Restated)
                                                        (Unaudited )
                                     (Unaudited )       Last
                                     Current            Corresponding
                                     Period             Period
                                     from 01/06/2005    from 01/06/2004
                                     to 30/11/2005      to 30/11/2004
                               Note  ('000      )       ('000      )
Turnover                           : 433,124            420,668           
Profit/(Loss) from Operations      : 77,696             60,965            
Finance cost                       : (18,695)           (10,511)          
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       : 52,578             48,431            
% Change over Last Period          : +9        %
EPS/(LPS)-Basic (in dollars)       : 0.1248             0.1433            
         -Diluted (in dollars)     : 0.1211             N/A               
Extraordinary (ETD) Gain/(Loss)    : N/A                N/A               
Profit/(Loss) after ETD Items      : 52,578             48,431            
Interim Dividend                   : 2.5 cents          5.5 cents
  per Share                                              
(Specify if with other             : N/A                N/A
  options)                                               
                                                         
B/C Dates for 
  Interim Dividend                 : 13/03/2006         to 15/03/2006 bdi.
Payable Date                       : 29/03/2006
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. 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 available-for-sale financial assets, 
investments held for trading and certain financial instruments, which are 
carried at fair values.

The accounting policies used in the accounts are consistent with those 
followed in the preparation of the Group's annual accounts for the year 
ended 31st May, 2005 except as described below.

In the current period, the Group has applied, for the first time, a number 
of new Hong Kong Financial Reporting Standards ("HKFRSs"), Hong Kong 
Accounting Standards ("HKASs") and Interpretations (hereinafter 
collectively referred to as the "new HKFRSs") issued by the HKICPA that 
are effective for accounting periods beginning on or after 1st January, 
2005. The application of the new HKFRSs has resulted in a change in the 
presentation of the income statement, balance sheet and the statement of 
changes in equity. In particular, the presentation of minority interests 
and share of tax of associated companies have been changed under HKAS 1 "
Presentation of Financial Statements" and HKAS 27 "Consolidated and 
Separate Financial Statements", respectively. The changes in presentation 
have been applied retrospectively. 

The adoption of the new HKFRSs has resulted in changes to the Group's 
accounting policies in the following areas that have major impacts on how 
the results for the current or prior accounting periods are prepared and 
presented:

Trademarks and goodwill

Subsequent to 30th November, 2004, the Group decided to early adopt HKFRS 
3 "Business Combinations" together with HKAS 36 "Impairment of Assets" and 
HKAS 38 "Intangible Assets" in 2005. Since 1st June, 2004, amortisation of 
the acquired trademarks and positive goodwill has been discontinued. As a 
result, the profit attributable to equity holders of the Company for the 
six months ended 30th November, 2004 is increased by approximately HK$3.7 
million as compared with that previously disclosed in the previous interim 
accounts.

Leasehold land 

The adoption of revised HKAS 17 "Leases" has resulted in a change in the 
accounting policy relating to the reclassification of leasehold land and 
land use rights from fixed assets to operating leases. The up-front 
prepayments made for the leasehold land and land use rights are expensed 
in the income statement on a straight-line basis over the period of the 
lease or where there is impairment, the impairment is expensed in the 
income statement. In prior years, the leasehold land was accounted for at 
fair value or cost less accumulated depreciation and accumulated 
impairment.

All buildings held for own use which are situated on freehold and 
leasehold land are presented as part of fixed assets and are stated at 
cost less accumulated depreciation, rather than at fair value.  

The new accounting policies have been adopted retrospectively, with the 
opening balances of retained profits and the comparative information 
adjusted for the amounts relating to prior period.  As a result, the 
opening retained profits as at 1st June, 2005 is increased by 
approximately HK$0.5 million.
  

Financial instruments
In the current period, the Group has applied HKAS 32 "Financial 
Instruments: Disclosures and Presentation" and HKAS 39 "Financial 
Instruments: Recognition and Measurement". HKAS 32 requires retrospective 
application. HKAS 39, which is effective for accounting periods beginning 
on or after 1st January, 2005, generally does not permit to recognise, 
derecognise or measure financial assets and liabilities on a retrospective 
basis. The principal effects resulting from the implementation of HKAS 32 
and HKAS 39 are summarised below: 

Convertible bonds

HKAS 32 requires an issuer of a compound financial instrument (that 
contains both financial liability and equity components) to separate the 
compound financial instrument into its liability and equity components. In 
subsequent periods, the liability component is carried at amortised cost 
using the effective interest method. The principal impact of HKAS 32 on 
the Group is in relation to convertible bonds issued by the Company that 
contain both liability and equity components. Previously, convertible 
bonds were classified as liabilities on the balance sheet. As HKAS 32 
requires retrospective application, comparative figures have been 
restated. 

Minority interests

In prior years, minority interests at the balance sheet date were 
presented in the consolidated balance sheet separately from liabilities 
and as deduction from net assets. Minority interests in the results of the 
Group for the period were also separately presented in the profit and loss 
account as a deduction before arriving at the profit attributable to 
shareholders.

With effect from 1st June, 2005, in order to comply with HKAS 1 and HKAS 
27, minority interests at the balance sheet date are presented in the 
consolidated balance sheet within equity, separately from the equity 
attributable to equity holders of the Company, and minority interests in 
the results of the Group for the period are presented on the face of the 
consolidated profit and loss account as an allocation of the total profit 
or loss for the period between the minority interests and the equity 
holders of the Company.

The presentation of minority interests in the consolidated balance sheet, 
profit and loss account and statement of changes in equity for the 
comparative period has been restated accordingly.

Gain or loss arising from transactions with minority interests are now 
recognised directly in equity.


2. Earnings per share

Basic earnings per share

The basic earnings per share was calculated based on the consolidated 
profit attributable to equity holders of the Company for the period of 
approximately HK$52,578,000 (2004: HK$48,431,000) and the weighted average 
number of ordinary shares of approximately 421,143,000 (2004: 337,969,000) 
in issue during the period.

Diluted earnings per share

During the period ended 30th November, 2005, diluted earnings per share 
was calculated based on the adjusted consolidated profit attributable to 
equity holders of the Company for the period of approximately HK$52,616,
000 and the weighted average number of ordinary shares of approximately 
434,432,000 that would be in issue having adjusted for the effects of all 
dilutive potential ordinary shares issuable during the period.

During the period ended 30th November, 2004, 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. 

Reconciliation

i)      A reconciliation of profit attributable to equity holders of the 
Company used in calculating the basic and diluted earnings per share was 
as follows: 

                                        For the period  For the period 
                                        ended           ended
                                        30th November,  30th November,
                                        2005            2004
                                                        (restated) 
                                        HK$'000         HK$'000 
                        
Profit attributable to equity holders
  of the Company used in calculating
  basic earnings per share              52,578          48,431 
Interest savings in respect of
  convertible bonds                     38              - 
                                        ---------       --------
Profit attributable to equity holders
  of the Company used in calculating
  diluted earnings per share            52,616          48,431
                                        =========       ========

ii)     A reconciliation of the number of ordinary shares for calculation 
of basic and diluted earnings per share was as follows: 

                                        For the period  For the period 
                                        ended           ended
                                        30th November,  30th November,
                                        2005            2004                                     
Weighted average number of ordinary
  shares used in calculating basic
  earnings per share                    421,143,000     337,969,000 
Dilutive potential effect in respect
  of convertible bonds                  13,289,000      - 
                                        ------------    ------------
Weighted average number of ordinary
  shares used in calculating diluted
  earnings per share                    434,432,000     337,969,000
                                        ============    ============