CAI Corp — Earnings Release 2005

Mar 8, 2006

Listed Company Information

Listed Company Information
HARBOUR CENTRE<00051> - Results Announcement Harbour Centre Development Limited announced on 08/03/2006: (stock code: 00051 ) Year end date: 31/12/2005 Currency: HKD Auditors' Report: Unqualified (Audited ) (Audited ) Last Current Corresponding Period Period from 01/01/2005 from 01/01/2004 to 31/12/2005 to 31/12/2004 Note ('Million ) ('Million ) Turnover 3 : 526.8 445.0 Profit/(Loss) from Operations 2,3 : 573.0 370.3 (restated) Finance cost : N/A N/A Share of Profit/(Loss) of Associates : 24.4 56.4 (restated) Share of Profit/(Loss) of Jointly Controlled Entities : N/A N/A Profit/(Loss) after Tax & MI : 517.1 371.7 (restated) % Change over Last Period : +39.1 % EPS/(LPS)-Basic (in dollars) 4 : 1.64 1.18 (restated) -Diluted (in dollars) : N/A N/A Extraordinary (ETD) Gain/(Loss) : N/A N/A Profit/(Loss) after ETD Items : 517.1 371.7 (restated) Final Dividend : 12.0 cents 12.0 cents per Share (Specify if with other : N/A N/A options) B/C Dates for Final Dividend : 04/05/2006 to 09/05/2006 bdi. Payable Date : 17/05/2006 B/C Dates for Annual General Meeting : 04/05/2006 to 09/05/2006 bdi. Other Distribution for : N/A Current Period B/C Dates for Other Distribution : N/A Remarks: (1) Change in accounting policies The HKICPA has issued a number of new and revised HKFRSs that are effective for accounting periods beginning on or after 1st January, 2005. The following sets out information on the significant changes in accounting policies for the current and prior accounting periods. HKAS 40 "Investment property" In prior years, investment properties were stated at fair value and surpluses on revaluation were credited to the investment property revaluation reserve. Deficits arising on revaluation were set off against previous revaluation surpluses and thereafter charged to the consolidated profit and loss account. Revaluation was only done as at the financial year-end date. With effect from 1st January, 2005, on adoption of HKAS 40, the Group's investment properties are stated at fair value with all the changes in fair value reported in the consolidated profit and loss account. This new accounting policy has been applied retrospectively. The revenue reserve as at 1st January, 2005 and 1st January, 2004 was restated and increased by HK$823.3 million and HK$674.6 million, respectively, which represented the transfer from the investment property revaluation reserve. Such transfer has no effect on the Group's shareholders' equity. The effect of the change in accounting for revaluation surpluses has increased the profit attributable to shareholders for the year ended 31st December, 2005 by HK$271.1 million (2004: HK$148.7 million). HKAS - INT 21 "Income taxes - recovery of revalued non-depreciable assets" In previous years, no deferred taxation was recognised on revaluation of the Group's investment properties on the basis that the recovery of the carrying amount of the investment properties would be through sale and such deferred taxation should be calculated at the tax rate applicable on eventual sale, which is nil in Hong Kong. With effect from 1st January, 2005, HKAS-INT 21 requires deferred taxation to be recognised for any changes in fair value of investment properties on the basis that the recovery of the carrying amount of the investment properties would be through use and be calculated at the applicable profits tax rate and charged to the profit and loss account. This new accounting policy has been applied retrospectively. Shareholders' equity as at 1st January, 2005 and 1st January, 2004 was restated and decreased by HK$144.1 million and HK$118.1 million respectively. The adjustments represent deferred tax liabilities attributable to the fair value gains on the Group's investment properties. The change has increased the deferred tax charge for the year ended 31st December, 2005 by HK$47.4 million ( 2004: HK$26.0 million). HK - INT 2 "The appropriate accounting policies for hotel properties" and HKAS 17 "Leases" In prior years, the Group's hotel property was stated at fair value based on an annual professional valuation. No depreciation was provided on the hotel property on the basis that it was maintained in a continuous state of sound repair such that, given the estimated life of the hotel property and its residual value, any depreciation was immaterial. With effect from 1st January, 2005, on adoption of HK-INT 2 and HKAS 17, the cost of the Group's hotel property was split into a lease of land and a lease of a building in proportion to the relative fair values of the interest in the land and the building elements at the inception of the lease. The leasehold land is stated at cost and is amortised over the period of the lease on a straight-line basis whereas the building is stated at cost less accumulated depreciation and impairment. These new accounting policies have been applied retrospectively. Shareholders' equity as at 1st January, 2005 and 1st January, 2004 was restated and decreased by HK$1,813.0 million, which comprised a reversal of the hotel property revaluation reserve of HK$1,756.9 million and adjustments to the revenue reserve of HK$56.1 million, and HK$1,644.3 million, which comprised a reversal of the hotel property revaluation reserve of HK$1, 589.9 million and adjustments to the revenue reserve of HK$54.4 million, respectively. The change has increased the depreciation charge to the consolidated profit and loss account for the year ended 31st December, 2005 by HK$5.8 million (2004 as restated: HK$1.7 million). HKAS 1 "Presentation of financial statements" The application of the new HKFRSs has also resulted in changes in the presentation of the financial statements retrospectively with comparatives restated to conform to current period's presentation, in particular, the presentation of the Group's share of associates' taxation. In prior years, the Group's share of associates' tax was presented as a component of taxation in the consolidated profit and loss account. On adoption of the HKAS 1, the Group's share of associates' profits less losses is presented on a post-tax basis. (2) Included in profit from operations are increase in fair value of investment properties of HK$271.1 million (2004: HK$148.7 million) and other net income of HK$42.6 million (2004: HK$20.9 million). (3) The turnover and profit from operations of HK$526.8 million and HK$573.0 million for the year ended 31st December, 2005 respectively and HK$445.0 million and HK$370.3 million for the previous year respectively were all generated from continuing operations. (4) The calculation of earnings per share is based on the profit for the year of HK$517.1 million (2004: HK$371.7 million) and on 315.0 million (2004: 315.0 million) ordinary shares in issue throughout the year. For the year under review and the preceding year, there is no difference between the basic and diluted earnings per share.