TOM Group Limited — Interim / Quarterly Report 2014

Jul 30, 2014

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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(Stock code: 2383)

INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2014

CHAIRMAN’S STATEMENT

I am pleased to announce the results of TOM Group Limited (“TOM” or the “Company”) and its subsidiaries (collectively referred to as the “TOM Group” or the “Group”) for the six months ended 30 June 2014.

For the six months to 30 June 2014, the Group reported HK$727 million revenues and operating loss of HK$106 million. Profit attributable to shareholders, including disposal gain, was HK$29 million.

During the reporting period, the Group continued to invest in our fast growing e-commerce joint venture with China Post, Ule. In January 2014, subscription by investors in Ule was completed and the Group recognised a disposal gain attributable to shareholders of HK$157 million. With the support from new investors and various new initiatives developed by the operation team, Ule achieved an encouraging 354% year-on-year growth in its gross merchandise value (GMV), and in only the first six months of this year recorded GMV of RMB2,311 million, exceeding last year’s full year GMV of RMB1,432 million.

The Mobile Internet Group reported revenues of HK$47 million, down from HK$207 million a year earlier, as a result of the exit from the 2.5G wireless value-added services market at the end of 2013. The Group will continue to implement cost control measures to rationalise the operations and to develop new products and services to offer our users.

During the review period, TOM Group invested in WeLab Holdings Limited (“WeLab”), a Hong Kong based internet and technology based consumer finance company. The Group will work closely with WeLab to launch its credit scoring and fraud control technology and services throughout Greater China region and Asia.

The Publishing Group maintained a stable performance during the reporting period, recording segment revenues and profit of HK$455 million and HK$24 million respectively.

* For reference only

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The Outdoor Media Group reported stable revenues of HK$116 million from its continuing operations, whilst the Television and Entertainment Group maintained its revenues at HK$108 million in the reporting period.

Going forward, TOM Group will maintain financial and operating disciplines while expanding the Group’s core businesses.

I would like to take this opportunity to thank the management and all the staff of TOM Group for their hard work and dedication.

Frank John Sixt Chairman

Hong Kong, 30 July 2014

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MANAGEMENT’S DISCUSSION AND ANALYSIS

FINANCIAL HIGHLIGHTS

	For the six months ended	For the six months ended
	30 June 2014	30 June 2013
	HK$’000	HK$’000
Revenue	726,679	975,106
Operating loss#before disposal gain	(105,556)	(85,823)
Gain on disposal of interests in joint ventures	174,995	-
Profit/(loss) attributable to equity holders of the Company	29,458	(113,465)
Earnings/(loss) per share (HK cents)	0.76	(2.91)

Including share of results of investments accounted for using the equity method

Business Review

During the reporting period, the Group focused on driving the growth of Ule, the e-commerce joint-venture with China Post and has embarked an exponential growth via its unique offline-toonline/ mobile platform. This has been the growth engine for the Group and Ule will unveil more new product and service offerings to tap the huge business opportunities in the fast growing China e-commerce market. During the reporting period, the Group recorded a disposal gain attributable to shareholders of HK$157 million due to the new investors’ subscription of Ule’s shares, which helps speed up Ule’s business development. The Group’s profit attributable to shareholders amounted to HK$29 million. Operating expenses reduced by 16% on a year-onyear basis with enhanced operating efficiency. Gross profit margin increased from 28% the same period last year to 33%.

E-Commerce

The Ule joint venture has been performing well during the reporting period. For the first six months this year, Ule achieved an encouraging 354% year-on-year growth in its gross merchandise value (GMV) and in only the first six months of this year recorded GMV of RMB2,311 million, exceeding last year’s full year GMV of RMB1,432 million. Repeated buyers accounted for 45% of the total buyers in the second quarter this year, demonstrating strong users’ loyalty. Orders placed through mobile phone accounted for 10% of the total number of transactions, demonstrating the fast development of mobile commerce.

Leveraging on China Post’s extensive outlets in the rural villages, Ule has kicked off its rural e- commerce initiative to drive sales, with its unique online, offline and mobile channels, and capture the huge business opportunities in the rural market. A province has been selected for the pilot scheme, and more provinces will join later this year to engage more rural store owners and villagers to shop and trade via the Ule platform at these outlets. These outlets can also offer various services, enhancing the quality of life among the villagers.

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The rural e-commerce service is helping more than tens of thousands China Post’s franchised stores in the rural villages to bring their business operations online. Data generated from the rural e-commerce system will be analysed with advanced big data technology to deepen Ule’s understanding on the demand for rural e-commerce. Ule then can offer more new services to assist merchants to tap the rural market.

Moreover, Ule’s “Anhui online agriculture transaction platform” has made its debut in the reporting period. The platform was supported by Anhui provincial government and key enterprises in the province to boost the growth of the agricultural sector.

Mobile Internet

The Mobile Internet Group has been incubating series of new businesses including music and game services. The Group has implemented a streamlined and focused operation and will explore new business models and leverage on popular distribution channels to bring in popular mobile games and services from developers in China and overseas.

Publishing

The Publishing Group maintained stable performance during the reporting period, with revenue reached HK$455 million and segment profit amounted to HK$24 million.

Outdoor Media

The Outdoor Media Group’s revenue amounted to HK$116 million, while segment loss reduced by 34% as a result of cost control initiatives and benefit from the high value LED assets.

Television and Entertainment

Television and Entertainment Group saw its revenue maintained at HK$108 million in the reporting period with a segment loss narrowed on efficient use of resources.

The Group is making good progress in rationalising its business operations in Mobile Internet, Publishing, Outdoor Media and Television and Entertainment respectively. During the reporting period, the Group has invested in WeLab, a Hong Kong based internet finance company. The Group will work closely with WeLab to launch its internet and technology based consumer finance platform throughout Mainland China, Greater China region and Asia.

Liquidity and Financial Resources

As at 30 June 2014, TOM Group had cash and bank balances, excluding pledged deposits, of approximately HK$620 million. A total of HK$3,468 million financing facilities were available, of which HK$2,468 million had been utilised as at 30 June 2014, to finance the Group’s investment, capital expenditures and for working capital purposes.

Total borrowings of TOM Group amounted to approximately HK$2,468 million as at 30 June 2014. These included long-term bank loans of approximately HK$2,289 million and short-term bank loans of approximately HK$179 million. The gearing ratio (Debts/(Debts + Equity)) of TOM Group was 79% as at 30 June 2014, same level as 31 December 2013.

As at 30 June 2014, the Group had net current assets of approximately HK$374 million, compared to balance of approximately HK$366 million as at 31 December 2013. As at 30 June 2014, the current ratio (Current assets/Current liabilities) of TOM Group was 1.32, compared to 1.30 as at 31 December 2013.

For the first six months of 2014, net cash used in operating activities amounted to HK$91 million, compared to HK$17 million in the same period of 2013. Net cash outflow used in investing activities was HK$96 million, mainly included an investment of HK$31 million and capital expenditures of HK$68 million.

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Charges on Group Assets

As at 30 June 2014, the Group had restricted cash amounting to HK$4 million, being bank deposits pledged in favour of certain publishing distributors in Taiwan as retainer fee for potential sales return.

Foreign Exchange Exposure

In general, it is the Group’s policy for each operating entity to borrow in local currencies, where necessary, to minimise currency risk.

Contingent Liabilities

As at 30 June 2014, TOM Group had no significant contingent liabilities.

Employee Information

As at 30 June 2014, TOM Group had approximately 2,060 full-time employees. For the first six months of the year, employee costs, including Directors’ emoluments, totalled HK$251 million. The Group’s employment and remuneration policies remained the same as detailed in the Annual Report for the year ended 31 December 2013.

Disclaimer:

Non-GAAP measures

Certain non-GAAP (generally accepted accounting principles) measures, such as operating profit/(loss) including share of results of investments accounted for using the equity method and segment profit/(loss) excluding gain on disposal of interests in joint ventures, are used for assessing the Group’s performance. These non-GAAP measures are not expressly permitted measures under GAAP in Hong Kong and may not be comparable to similarly titled measures for other companies. Accordingly, such non-GAAP measures should not be considered as an alternative to operating income as an indicator of the operating performance of the Group or as an alternative to cash flows from operating activities as a measure of liquidity. The use of non-GAAP measures is provided solely to enhance the overall understanding of the Group’s current financial performance. Additionally, since the Group has historically reported certain non-GAAP results to investors, it is considered the inclusion of non-GAAP measures provides consistency in the Group’s financial reporting.

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CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2014

		Unaudited	Unaudited
		Six months	ended	30 June
	Note	2014		2013
		HK$’000		HK$’000
Revenue	2	726,679		975,106
		═══════════	═══════════
Cost of sales	5	(489,983)		(701,850)
Selling and marketing expenses	5	(108,594)		(125,021)
Administrative expenses	5	(79,894)		(86,956)
Other operating expenses	5	(120,760)		(157,937)
Other gains, net	5	1,610		13,368
Gain on disposal of interests in joint ventures	3	174,995		-
Share of profits less losses of investments accounted
for using the equity method	4	(34,614)		(2,533)
		───────────	───────────
		69,439		(85,823)
Finance income	6	4,939		6,878
Finance costs	6	(34,830)		(32,711)
		───────────	───────────
Finance costs, net	6	(29,891)		(25,833)
		───────────	───────────
Profit/(loss) before taxation		39,548		(111,656)
Taxation	7	927		(8,973)
		───────────	───────────
Profit/(loss) for the period		40,475		(120,629)
		═══════════	═══════════
Attributable to:
- Non-controlling interests		11,017		(7,164)
		═══════════	═══════════
- Equity holders of the Company		29,458		(113,465)
		═══════════	═══════════
Earnings/(loss) per share attributable to equity holders
of the Company during the period
Basic and diluted	9	HK0.76 cents	HK(2.91) cents
		═══════════	═══════════

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CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 JUNE 2014

	Unaudited	Unaudited
	Six months	ended 30 June
	2014	2013
	HK$’000	HK$’000
Profit/(loss) for the period	40,475	(120,629)
Items that may be subsequently reclassified to income
statement:
Revaluation surplus on available-for-sale financial assets	2,899	111
Exchange translation differences	(26,199)	34,489
	───────	───────
Other comprehensive (expense)/income for the period,
net of tax	(23,300)	34,600
	───────	───────
Total comprehensive income/(expense) for the period	17,175	(86,029)
	═══════	═══════
Total comprehensive income/(expense) for the period
attributable to:
- Non-controlling interests	7,349	(8,026)
	═══════	═══════
- Equity holders of the Company	9,826	(78,003)
	═══════	═══════

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CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2014

Note ASSETS AND LIABILITIES Non-current assets Fixed assets Goodwill Other intangible assets Investments accounted for using the equity method 4 Available-for-sale financial assets Advance to an investee company Deferred tax assets Other non-current assets Current assets Inventories Trade and other receivables 10 Restricted cash Cash and cash equivalents Current liabilities Trade and other payables 11 Taxation payable Long-term bank loans - current portion Short-term bank loans Net current assets Total assets less current liabilities Non-current liabilities Deferred tax liabilities Non-current portion of long-term bank loans Pension obligations Net assets EQUITY Equity attributable to the Company’s equity holders Share capital Deficits Own shares held Non-controlling interests Total equity

Unaudited 30 June 2014 Audited 31 December 2013 HK$’000 HK$’000 126,525 142,315 644,623 646,914 89,970 88,023 1,561,999 1,435,970 58,160 24,137 2,180 2,180 34,706 34,421 11,340 6,725 ──────── ──────── 2,529,503 2,380,685 --------------- --------------- 113,810 114,096 791,833 793,169 4,025 3,105 619,677 695,179 ──────── ──────── 1,529,345 1,605,549 --------------- --------------- 865,792 945,806 37,290 48,836 73,701 73,901 178,434 171,138 ──────── ──────── 1,155,217 1,239,681 --------------- --------------- 374,128 365,868 --------------- --------------- 2,903,631 2,746,553 -------------- -------------- 7,517 6,398 2,215,617 2,075,718 37,435 37,120 ──────── ──────── 2,260,569 2,119,236 --------------- --------------- 643,062 627,317 ════════ ════════ 389,328 389,328 (56,966) (66,792) (6,244) (6,244) ──────── ──────── 326,118 316,292 316,944 311,025 ──────── ──────── 643,062 627,317 ════════ ════════

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CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2014

Balance at 1 January 2014 Comprehensive income: Profit for the period Other comprehensive income: Revaluation surplus on available-for- sale financial assets Exchange translation differences Total comprehensive income/(expense) for the period ended 30 June 2014 Transactions with equity holders: Dividend paid to non-controlling interests Contributions from non-controlling interests Transactions with equity holders Balance at 30 June 2014

Unaudited Attributable to equityholders ofthe Company Share capital Own shares held Share premium Capital reserve Capital redemption reserve General reserve Available- for-sale financial assets reserve Exchange reserve Accumulated losses Total shareholders’ funds Non- controlling interests Total equity HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 389,328 (6,244) 3,625,981 (11,186) 776 150,542 8,012 790,965 (4,631,882) 316,292 311,025 627,317 ──────── ──────── ──────── ─────── ─────── ─────── ────── ────── ───────── ──────── ──────── ──────── - - - - - - - - 29,458 29,458 11,017 40,475 - - - - - - 2,899 - - 2,899 - 2,899 - - - - - - - (22,531) - (22,531) (3,668) (26,199) ──────── ──────── ──────── ─────── ─────── ─────── ─────── ─────── ──────── ──────── ──────── ──────── - - - - - - 2,899 (22,531) 29,458 9,826 7,349 17,175 ──────── ──────── ──────── ──────── ──────── ──────── ─────── ─────── ──────── ──────── ──────── ──────── - - - - - - - - - - (2,368) (2,368) - - - - - - - - - - 938 938 ──────── ──────── ──────── ─────── ─────── ─────── ─────── ─────── ───────── ──────── ──────── ──────── - - - - - - - - - - (1,430) (1,430) ──────── ──────── ──────── ─────── ─────── ─────── ─────── ─────── ───────── ──────── ──────── ──────── 389,328 (6,244) 3,625,981 (11,186) 776 150,542 10,911 768,434 (4,602,424) 326,118 316,944 643,062 ════════ ════════ ════════ ═══════ ═══════ ═══════ ═══════ ═══════ ═════════ ════════ ════════ ════════

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CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2014

Balance at 1 January 2013 Comprehensive income: Loss for the period Other comprehensive income: Revaluation surplus on available-for- sale financial assets Exchange translation differences Total comprehensive income/(expense) for the period ended 30 June 2013 Transactions with equity holders: Contributions from non-controlling interests Transfer to general reserve Transactions with equity holders Balance at 30 June 2013

Unaudited Attributable to equityholders ofthe Company Share capital Own shares held Share premium Capital reserve Capital redemption reserve General reserve Available- for-sale financial assets reserve Exchange reserve Accumulated losses Total shareholders’ funds Non- controlling interests Total equity HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 389,328 (6,244) 3,625,981 28,021 776 144,464 4,109 731,064 (4,117,767) 799,732 321,903 1,121,635 ──────── ──────── ──────── ─────── ─────── ─────── ────── ────── ───────── ──────── ──────── ──────── - - - - - - - - (113,465) (113,465) (7,164) (120,629) - - - - - - 111 - - 111 - 111 - - - - - - - 35,351 - 35,351 (862) 34,489 ──────── ──────── ──────── ─────── ─────── ─────── ─────── ─────── ───────── ──────── ──────── ──────── - - - - - - 111 35,351 (113,465) (78,003) (8,026) (86,029) ──────── ──────── ──────── ──────── ──────── ──────── ─────── ─────── ──────── ──────── ──────── ──────── - - - - - - - - - - 938 938 - - - - - 1,183 - - (1,183) - - - ──────── ──────── ──────── ─────── ─────── ─────── ─────── ─────── ───────── ──────── ──────── ──────── - - - - - 1,183 - - (1,183) - 938 938 ──────── ──────── ──────── ─────── ─────── ─────── ─────── ─────── ───────── ──────── ──────── ──────── 389,328 (6,244) 3,625,981 28,021 776 145,647 4,220 766,415 (4,232,415) 721,729 314,815 1,036,544 ════════ ════════ ════════ ═══════ ═══════ ═══════ ═══════ ═══════ ═════════ ════════ ════════ ════════

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NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION

1 Basis of preparation and accounting policies

This financial information is extracted from the Group’s unaudited condensed consolidated interim financial information for the six months ended 30 June 2014 which has been prepared in accordance with Hong Kong Accounting Standard ("HKAS") 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants (“HKICPA”) and applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

The condensed consolidated interim financial information should be read in conjunction with the annual financial statements for the year ended 31 December 2013, which have been prepared in accordance with Hong Kong Financial Reporting Standards (“HKFRS”).

Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total annual earnings.

The accounting policies and methods of computation used in the preparation of this interim financial information are consistent with those used in 2013 annual financial statements, except for the adoption of amendments to standards and new interpretation which are relevant to the operations of the Group and mandatory for annual periods beginning 1 January 2014.

The adoption of these amendments to standards and new interpretation does not have a material impact on the Group’s accounting policies.

2 Turnover, revenue and segment information

The Group has five reportable operating segments:

• Mobile Internet Group - provision of mobile Internet services, online advertising, commercial enterprise solutions and online communication services.

• E-Commerce Group - provision of services to users using the mobile and Internetbased marketplace and provision of technical services for online trading platform.

• Publishing Group - magazine and book circulation, sales of publication advertising and other related products.

• Outdoor Media Group - advertising sales of outdoor media assets and provision of outdoor media services.

• Television and Entertainment Group - advertising sales in relation to satellite television channel operations, provision of broadcasting programmes and provision of media sales, event production and marketing services.

Sales between segments are carried out at arm’s length.

• 11 -

2 Turnover, revenue and segment information (Continued)

The segment results for the six months ended 30 June 2014 are as follows:

Gross segment revenue Inter-segment revenue Net revenue from external customers Segment profit/(loss) before amortisation and depreciation Amortisation and depreciation Segment profit/(loss) Other material non-cash items: Gain on disposal of interests in joint ventures Share of profits less losses of investments accounted for using the equity method Finance costs: Finance income (note a) Finance expenses (note a) Segment profit/(loss) before taxation Unallocated corporate expenses Profit before taxation Expenditure for operating segment non-current assets Unallocated expenditure for non-current assets Total expenditure for non-current assets

Unaudited Six months ended 30 June 2014

Mobile Internet Group E-Commerce Group Publishing Group Outdoor Media Group Television and Entertainment Group Total HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 46,799 1,870 454,960 115,810 107,579 727,018 - - - - (339) (339) ─────── ─────── ─────── ─────── ─────── ──────── 46,799 1,870 454,960 115,810 107,240 726,679 ═══════ ═══════ ═══════ ═══════ ═══════ ════════ (31,685) (3,768) 79,524 3,437 (10,909) 36,599 (4,884) (57) (55,683) (10,298) (5,696) (76,618) ─────── ─────── ─────── ─────── ─────── ──────── (36,569) (3,825) 23,841 (6,861) (16,605) (40,019) ═══════ ═══════ ═══════ ═══════ ═══════ ════════ - 174,995 - - - 174,995 (140) (19,203) (15,271) - - (34,614) ─────── ─────── ─────── ─────── ─────── ──────── (140) 155,792 (15,271) - - 140,381 ─────── ─────── ─────── ─────── ─────── ──────── 3,705 44 9,565 561 37 13,912 - - (5,147) - (9,353) (14,500) ─────── ─────── ─────── ─────── ─────── ──────── 3,705 44 4,418 561 (9,316) (588) ─────── ─────── ─────── ─────── ─────── ──────── (33,004) 152,011 12,988 (6,300) (25,921) 99,774 ═══════ ═══════ ═══════ ═══════ ═══════ (60,226) ──────── 39,548 ════════ 785 - 55,049 6,733 5,154 67,721 5 ──────── 67,726 ════════

Note (a): Inter-segment interest income and inter-segment interest expenses amounted to HK$9,261,000 and HK$9,883,000 were included in the finance income and finance expenses respectively.

• 12 -

2 Turnover, revenue and segment information (Continued)

The segment results for the six months ended 30 June 2013 are as follows:

Gross segment revenue Inter-segment revenue Net revenue from external customers Segment profit/(loss) before amortisation and depreciation Amortisation and depreciation Segment profit/(loss) Other material non-cash items: Share of profits less losses of investments accounted for using the equity method Finance costs: Finance income (note a) Finance expenses (note a) Segment profit/(loss) before taxation Unallocated corporate expenses Loss before taxation Expenditure for operating segment non-current assets Unallocated expenditure for non-current assets Total expenditure for non-current assets

Unaudited Six months ended 30 June 2013

Mobile Internet Group E-Commerce Group Publishing Group Outdoor Media Group Television and Entertainment Group Total HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 207,278 2,592 485,047 178,172 102,364 975,453 - - - - (347) (347) ─────── ─────── ─────── ─────── ─────── ──────── 207,278 2,592 485,047 178,172 102,017 975,106 ═══════ ═══════ ═══════ ═══════ ═══════ ════════ (12,450) (34,195) 89,987 8,278 (10,549) 41,071 (6,475) (2,777) (55,201) (18,600) (7,761) (90,814) ─────── ─────── ─────── ─────── ─────── ──────── (18,925) (36,972) 34,786 (10,322) (18,310) (49,743) ═══════ ═══════ ═══════ ═══════ ═══════ ════════ 283 5,591 (8,407) - - (2,533) ─────── ─────── ─────── ─────── ─────── ──────── 283 5,591 (8,407) - - (2,533) ─────── ─────── ─────── ─────── ─────── ──────── 5,392 36 11,045 496 52 17,021 - - (6,050) - (11,528) (17,578) ─────── ─────── ─────── ─────── ─────── ──────── 5,392 36 4,995 496 (11,476) (557) ─────── ─────── ─────── ─────── ─────── ──────── (13,250) (31,345) 31,374 (9,826) (29,786) (52,833) ═══════ ═══════ ═══════ ═══════ ═══════ (58,823) ──────── (111,656) ════════ 2,816 269 59,109 6,417 9,407 78,018 505 ──────── 78,523 ════════

Note (a): Inter-segment interest income and inter-segment interest expenses amounted to HK$10,658,000 and HK$12,123,000 were included in the finance income and finance expenses respectively.

• 13 -

2 Turnover, revenue and segment information (Continued)

The segment assets and liabilities at 30 June 2014 are as follows:

Segment assets Investments accounted for using the equity method Unallocated assets Total assets Segment liabilities Unallocated liabilities: Corporate liabilities Current taxation Deferred taxation Borrowings Total liabilities	Unaudited As at 30 June 2014
	Mobile Internet Group E-Commerce Group Publishing Group Outdoor Media Group Television and Entertainment Group Total HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 595,261 129,918 1,213,275 312,308 160,675 2,411,437 4,404 1,535,436 22,159 - - 1,561,999 85,412 ──────── 4,058,848 ════════ 222,881 39,469 360,101 103,209 53,990 779,650 123,577 37,290 7,517 2,467,752 ──────── 3,415,786 ════════

The segment assets and liabilities at 31 December 2013 are as follows:

Segment assets Investments accounted for using the equity method Unallocated assets Total assets Segment liabilities Unallocated liabilities: Corporate liabilities Current taxation Deferred taxation Borrowings Total liabilities	Audited As at 31 December 2013
	Mobile Internet Group E-Commerce Group Publishing Group Outdoor Media Group Television and Entertainment Group Total HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 649,427 115,280 1,265,206 322,273 143,766 2,495,952 4,623 1,390,709 40,638 - - 1,435,970 54,312 ──────── 3,986,234 ════════ 242,223 51,123 405,215 109,608 57,409 865,578 117,348 48,836 6,398 2,320,757 ──────── 3,358,917 ════════

The unallocated assets represent the corporate assets. The unallocated liabilities represent the corporate liabilities in addition to operating segment taxation payable, deferred tax liabilities and borrowings which are managed on a central basis.

• 14 -

3 Gain on disposal of interests in joint ventures

On 16 January 2014, a joint venture, held as to 49% by a non-wholly owned subsidiary of the Group, signed a shareholders’ agreement and a subscription agreement with several investors. Pursuant to the subscription agreement, the joint venture agreed to allot and issue and the investors agreed on a several basis to subscribe for certain Series A Preferred Shares representing 13.25% of the total share capital of the joint venture on a fully diluted basis at the aggregate investors’ subscription price of US$110 million. Following completion of the investors’ subscription, the former joint venture became an associated company of the Group, held as to 42.51% by a non-wholly owned subsidiary of the Group, 44.24% by the joint venture partner and 13.25% by investors on a fully diluted basis. The Group recognised a dilution gain of HK$174,995,000 in the consolidated income statement for the period on this disposal. Net gain attributable to equity holders of the Company amounted to HK$157,499,000.

4 Investments accounted for using the equity method

The amounts recognised in the statement of financial position are as follows:

	Unaudited	Audited
	30 June	31 December
	2014	2013
	HK$’000	HK$’000
Associated companies	1,561,999	45,261
Joint ventures	-	1,390,709
	────────	────────
	1,561,999	1,435,970
	════════	════════

The amounts recognised in the income statement are as follows:

		Unaudited
	Six months ended 30 June
	2014	2013
	HK$’000	HK$’000
Associated companies	(30,507)	(8,124)
Joint ventures	(4,107)	5,591
	───────	──────
	(34,614)	(2,533)
	═══════	══════

• 15 -

5 Operating profit/(loss)

Operating profit/(loss) is stated after charging/crediting the following:

	Unaudited
	Six months ended	30 June
	2014	2013
	HK$'000	HK$'000
Charging:
Depreciation of fixed assets	27,209	34,151
Amortisation of other intangible assets	49,772	56,974
Amortisation of other intangible assets included in interests
in associated companies	-	1,356
Loss on disposal of fixed assets	-	49
	══════	══════
Crediting:
Exchange gain, net	1,127	13,085
Dividend income from available-for-sale financial assets	314	332
Gain on disposal of fixed assets	169	-
	══════	══════

6 Finance costs, net

	Unaudited
	Six months ended	30 June
	2014	2013
	HK$’000	HK$’000
Interest and borrowing costs on bank loans	33,892	31,773
Interest on other loans	938	938
	──────	──────
	34,830	32,711
Less: Bank interest income	(4,939)	(6,878)
	──────	──────
	29,891	25,833
	══════	══════

• 16 -

7 Taxation

Hong Kong profits tax has been provided at the rate of 16.5% (2013: 16.5%) on the estimated assessable profits for the period. Taxation on overseas profits has been calculated on the estimated assessable profits for the period at the rates of taxation prevailing in the countries in which the Group operates.

The amount of taxation (credited)/charged to the condensed consolidated interim income statement represents:

	Unaudited
	Six months ended	30 June
	2014	2013
	HK$’000	HK$’000
Overseas taxation	7,078	10,569
Over-provision in prior years	(8,906)	(1,793)
Deferred taxation	901	197
	──────	──────
Taxation (credit)/charge	(927)	8,973
	══════	══════

8 Dividends

No dividends had been paid or declared by the Company for the six months ended 30 June 2014 (2013: Nil).

9 Earnings/(loss) per share

(a) Basic

The calculation of the basic earnings/(loss) per share is based on consolidated profit attributable to the equity holders of the Company of HK$29,458,000 (2013: loss of HK$113,465,000) and the weighted average of 3,893,270,558 (2013: 3,893,270,558) ordinary shares in issue during the period.

(b) Diluted

Diluted earnings per share is equal to the basic earnings per share for the period ended 30 June 2014 as all the outstanding share options granted by the Company were lapsed. For the period ended 30 June 2013, diluted loss per share is equal to the basic loss per share as the exercise price of the outstanding share options granted by the Company were higher than the average market price of the shares of the Company.

• 17 -

10 Trade and other receivables

	Unaudited	Audited
	30 June	31 December
	2014	2013
	HK$'000	HK$'000
Trade receivables	398,494	397,111
Prepayments, deposits and other receivables	393,339	396,058
	────────	────────
	791,833	793,169
	════════	════════

The Group has established credit policies for customers in each of its businesses. The average credit period granted for trade receivables ranges from 30 to 120 days. The Group’s turnover is determined in accordance with terms specified in the contracts governing the relevant transactions. The carrying values of trade and other receivables approximate their fair values.

The ageing analyses of the Group’s trade receivables were as follows:

	Unaudited	Audited
	30 June	31 December
	2014	2013
	HK$'000	HK$'000
Current	96,322	94,622
31-60 days	108,001	114,330
61-90 days	65,405	64,569
Over 90 days	221,710	217,843
	────────	────────
	491,438	491,364
Less: Provision for impairment	(92,944)	(94,253)
	────────	────────
	398,494	397,111
	════════	════════

• 18 -

11 Trade and other payables

	Unaudited	Audited
	30 June	31 December
	2014	2013
	HK$'000	HK$'000
Trade payables	269,243	280,640
Other payables and accruals	596,549	665,166
	────────	────────
	865,792	945,806
	════════	════════
The carrying values of trade and other payables approximate their fair values.
The ageing analyses of the Group’s trade payables were as follows:

	Unaudited	Audited
	30 June	31 December
	2014	2013
	HK$'000	HK$'000
Current	48,408	60,700
31-60 days	24,878	28,045
61-90 days	10,697	15,521
Over 90 days	185,260	176,374
	────────	────────
	269,243	280,640
	════════	════════

• 19 -

CORPORATE GOVERNANCE CODE (“Code”)

The Company has complied with all the code provisions of the Code contained in Appendix 14 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (“Listing Rules”) throughout the six months ended 30 June 2014, save and except Code Provision A.5 of the Code.

The Company has considered the merits of establishing a nomination committee but is of the view that it is in the best interests of the Company that the Board collectively reviews, deliberates on and approves the structure, size and composition of the Board and the appointment of any new Director. The Board is tasked with ensuring that it has a balanced composition of skills and experience appropriate for the requirements of the businesses of the Group and that appropriate individuals with the relevant expertise and leadership qualities are appointed to the Board to complement the capabilities of the existing Directors. In addition, the Board as a whole is also responsible for reviewing the succession plan for the Directors.

MODEL CODE FOR SECURITIES TRANSACTIONS BY DIRECTORS

The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers (“Model Code”) contained in Appendix 10 to the Listing Rules as the Group’s code of conduct regarding Directors’ securities transactions. In response to specific enquiry made with the Directors, all Directors confirmed that they have complied with the required standard as set out in the Model Code during the six months ended 30 June 2014.

PURCHASE, SALE OR REDEMPTION OF SECURITIES

During the six months ended 30 June 2014, neither the Company nor any of its subsidiaries has purchased or sold any of the Company’s listed shares. In addition, the Company has not redeemed any of its listed shares during the period.

GENERAL INFORMATION

The unaudited condensed consolidated interim financial information of the Company and its subsidiary companies for the six months ended 30 June 2014 have been reviewed by the Company’s auditor, PricewaterhouseCoopers, in accordance with Hong Kong Standard on Review Engagements 2410 “Review of Interim Financial Information Performed by the Independent Auditor of the Entity” issued by the Hong Kong Institute of Certified Public Accountants. The auditor’s independent review report will be included in the Interim Report to shareholders. The unaudited condensed consolidated interim financial information of the Company and its subsidiary companies for the six months ended 30 June 2014 have been reviewed by the Audit Committee of the Company.

As at the date hereof, the directors of the Company are:

Executive Directors: Non-executive Directors: Independent Non-executive Directors: Mr. Yeung Kwok Mung Mr. Frank Sixt (Chairman) Mr. Henry Cheong Ms. Angela Mak Ms. Debbie Chang Mr. James Sha Mr. Edmond Ip Mr. Albert Ip Mrs. Angelina Lee Alternate Director: Mrs. Chow Woo Mo Fong, Susan (Alternate to Mr. Frank Sixt)

• 20 -