Mao Geping Cosmetics Co., Ltd. — Earnings Release 2001

Mar 25, 2002

Listed Company Information

SCMP GROUP<00583> - Results Announcement (Summary) SCMP Group Limited announced on 25/3/2002: (stock code: 583) Year end date: 31/12/2001 Currency: HK$ Auditors' Report: Neither Review of Interim Report by: N/A (Audited) (Audited) 18-Month 12-Month Period Period from 1/7/2000 from 1/7/1999 to 31/12/2001 to 30/6/2000 ('000) ('000) Turnover : 2,745,083 1,912,913 Profit/(Loss) from Operations : 614,850 659,417 Finance cost : (1,020) (1,564) Share of Profit/(Loss) of Associates : 10,200 7,038 Share of Profit/(Loss) of Jointly Controlled Entity : (15,857) (3,184) Profit/(Loss) after Tax & MI : 482,793 562,574 % Change over Last Period : N/A EPS/(LPS)-Basic : 27.85 cents 32.49 cents -Diluted : 27.84 cents 32.47 cents Extraordinary (ETD) Gain/(Loss) : - - Profit/(Loss) after ETD Items : 482,793 562,574 Final Dividend per Share : NIL 15 cents (Specify if with other options) : - - B/C Dates for Final Dividend : - Payable Date : - B/C Dates for Annual General Meeting : 23/5/2002 to 28/5/2002 bdi. Other Distribution for Current Period : - B/C Dates for Other Distribution : - Remarks: 1. Change of financial year end date from 30 June to 31 December Following the change of financial year end date from 30 June to 31 December commencing in the year 2001, this is the first set of audited consolidated final results of the Company and its group of companies (the "Group") for the 18 month period ended 31 December 2001. 2. Summary of prior year adjustments In the current period, the Group has early adopted the following Statements of Standard Accounting Practice ("SSAPs") issued by Hong Kong Society of Accountants which are effective for accounting periods commencing on or after 1 January 2001. SSAP 9 (revised) Events after the balance sheet date SSAP 14 (revised) Leases SSAP 26 Segment reporting SSAP 28 Provisions, contingent liabilities and contingent assets SSAP 29 Intangible assets SSAP 30 Business combinations SSAP 31 Impairment of assets SSAP 32 Consolidated financial statements and accounting for investments in subsidiaries The comparatives have been adjusted or extended to take into account the requirements of the new accounting standards. The effect of adopting SSAP 9 (revised), SSAP 29 and SSAP 31 are set out below. Except for the above, there is no impact on the operating profit resulting from the adoption of the above standards in the financial statements as the Group was already following the recognition and measurement principles in those standards. (a) Publishing titles Prior to the 18 month period ended 31 December 2001, publishing titles were stated at cost. No amortisation was provided for in the financial statements. In the 18 month period ended 31 December 2001, the Group has adopted SSAP 29 "Intangible Assets" whereby publishing titles are stated at cost less accumulated amortisation and provision for impairment in value, if any. The Group's publishing titles are amortised on a straight-line basis over 10 years, taking into account the rapid change in the business environment and other factors. The adoption of SSAP 29 represents a change in accounting policies and the effects on the Group's financial statements resulting from such change have been accounted for as a prior year adjustment. The Group's publishing titles had been fully amortised up to 30 June 1997 and there was no impact on the operating profits for the 18 month period ended 31 December 2001 and the 12 month period ended 30 June 2000. The opening retained profits of the Group at 1 July 1999 have been reduced by HK$1,820,000,000 which represents the accumulated amortisation for publishing titles for periods prior to 1 July 1999. (b) Goodwill Goodwill arising on the acquisition of subsidiaries, associates and jointly controlled entities represents the excess of purchase consideration paid over the fair values ascribed to the identifiable assets and liabilities acquired. Prior to the 18 month period ended 31 December 2001, goodwill was eliminated against reserves in the year of acquisition. In the 18 month period ended 31 December 2001, the Group has adopted earlier SSAP 30 "Business Combinations" and SSAP 31 "Impairment of Assets" whereby goodwill is restated in the balance sheet at cost less accumulated amortisation and provision for impairment in value, if any. Goodwill is amortised on a straight-line basis over an estimated useful economic life of not more than 20 years. Provision for impairment on any excess of the carrying amount of the goodwill over its estimated recoverable amount is expensed in the profit and loss account in the year in which the impairment occurs. For the 18 month period ended 31 December 2001, Group had no goodwill amortisation charge as the goodwill has been fully amortised or provided for impairment prior to 1 July 2000. The adoption of SSAPs 30 and 31 represents a change in accounting policies and the effects on the Group's financial statements resulting from such change have been accounted for as a prior year adjustment. The comparative consolidated profit and loss account for the 12 month period ended 30 June 2000 has been restated to conform with the changes in accounting policies. For the 12 month period ended 30 June 2000, the Group's amortisation of goodwill was HK$8,657,000 and the provision for impairment of goodwill was HK$22,657,000. These have resulted in a decrease in the Group's net profit for the 12 month period ended 30 June 2000 by HK$31,314,000. The opening retained profits of the Group at 1 July 1999 have been reduced by HK$578,719,000 which is the aggregate of the accumulated amortisation of goodwill of HK$431,261,000 and the accumulated provision for impairment of goodwill of HK$147,458,000 relating to periods prior to 1 July 1999. (c) Dividend distributions In accordance with the SSAP 9 (revised), the Group no longer recognises dividends proposed or declared after the balance sheet date as a liability at the balance sheet date. This change in accounting policy has been applied retrospectively so that the comparatives presented have been restated to conform to the change in accounting policy. This change has resulted in an increase in Group's opening retained profits at 1 July 1999 by HK$259,650,000 which is the reversal of the provision for 1999 final dividend previously recorded as a liability as at 30 June 1999. (d) Minority interests In the consolidated balance sheet, minority interests of HK$3,992,000 previously included in the "Accounts payable and accrued liabilities" was reclassified to "Minority interests" in line with the presentation in the 18 month period ended 31 December 2001. In the consolidated profit and loss account, the profit attributable to minority interests of HK$1,206,000 previously included under "Other operating expenses" was also reclassified to "Minority interests". Changes to the consolidated balance sheet (i) Accounts payable and accrued liabilities were reduced by HK$3,992,000. (ii) Current liabilities were reduced by HK$3,992,000. (iii) Minority interests were increased by HK$3,992,000. Changes to the consolidated profit and loss accounts (iv) Other operating expenses were reduced by HK$ 1,206,000. (v) Minority interests were increased by HK$ 1,206,000. (vi) Profit attributable to shareholders - no change. (e) Segment reporting In accordance with the Group's internal financial reporting the Group has determined that business segments be presented as the primary reporting format and geographical as secondary reporting format. No geographical reporting format is presented as the substantial businesses are based in Hong Kong. 3. Segment information The Company acted as an investment holding company during the period. The principal activities of the Group during the 18 month period ended 31 December 2001 have not changed and consisted of the publishing, printing and distribution of the South China Morning Post, Sunday Morning Post and other print and on-line publications, retailing, music publishing, video and film post-production, recreation clubs, education and holding of properties for rental income purpose. An analysis of the Group's turnover and contribution to operating profit for the period is as follows: Contribution to Turnover operating profit (Restated) 18 month 12 month 18 month 12 month period ended period ended period ended period ended 31 December 2001 30 June 2000 31 December 2001 30 June 2000 HK$'000 HK$'000 HK$'000 HK$'000 Newspapers, magazines and other publications 1,722,925 1,262,724 532,473 571,432 Retailing 610,408 359,664 (1,272) 6,445 Entertainment, recreation and education services 247,091 172,957 16,298 2,956 Video and film post-production 47,803 34,734 4,250 3,373 Property holding116,856 82,834 62,081 73,647 _____________ _____________ _____________ __________ Total 2,745,083 1,912,913 613,830 657,853 4. Earnings per share The calculation of basic earnings per share is based on the net profit for the period attributable to shareholders of HK$482,793,000 (2000: HK$562,574,000) and the weighted average of 1,733,784,078 (2000: 1,731,388,275) shares in issue during the period. The diluted earnings per share for the period is based on the net profit for the period attributable to shareholders of HK$482,793,000 (2000: HK$562,574,000) and the weighted average of 1,733,784,078 (2000: 1,731,388,275) shares in issue during the period plus 136,447 (2000: 1,265,350) dilutive shares deemed to have been issued for no consideration in respect of share options outstanding during the period.