WH Group Limited — Interim / Quarterly Report 2003

Dec 24, 2002

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PREMIUM LAND LIMITED

(Incorporated in Bermuda with limited liability)

INTERIM RESULTS FOR THE SIX MONTHS ENDED 30TH SEPTEMBER, 2002

INTERIM RESULTS

The board of directors (the “Board”) of Premium Land Limited (the “Company”) announces the unaudited condensed consolidated results of the Company and its subsidiaries (together “the Group”) for the six month ended 30th September, 2002.

CONDENSED CONSOLIDATED INCOME STATEMENT

NOTES Turnover 3 Cost of sales Other revenue Administrative expenses Other operating expenses Loss from operations 4 Finance costs Loss on disposal of subsidiaries Share of results of associates Loss before taxation Taxation 5 Loss before minority interests Minority interests Loss for the period	Six months ended 30th September, 2002 2001 (unaudited) (unaudited) HK$’000 HK$’000 192,774 40,920 (211,933) (64,510) (19,159) (23,590) 210 2,544 (14,124) (40,070) (65,267) – (98,340) (61,116) (5,376) (3,770) – (4,942) 18 (5,952) (103,698) (75,780) – – (103,698) (75,780) (370) 9,588 (104,068) (66,192)

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Loss per share	6
Basic		(3.73) cents	(20.40) cents
Diluted		N/A	N/A

NOTES TO THE CONDENSED FINANCIAL STATEMENTS

1. BASIS OF PREPARATION

The unaudited condensed financial statements have been prepared in accordance with Statement of Standard Accounting Practice (“SSAP”) 25 “Interim financial reporting” issued by the Hong Kong Society of Accountants, and with the applicable disclosure requirements of Appendix 16 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”).

2. PRINCIPAL ACCOUNTING POLICIES

The condensed financial statements have been prepared under the historical cost convention as modified for the revaluation of investment properties and certain investments in securities.

The accounting policies adopted are consistent with those followed in the preparation of the Group’s financial statements for the year ended 31st March, 2002, except that in the current period, the Group has adopted for the first time, a number of new and revised SSAPs. The major effects of adopting these revised SSAPs are summarized as follows:

SSAP 1 (revised) Presentation of financial statements

SSAP 1 prescribes the basis for presentation of financial statements and sets out guidelines for their structure and minimum requirements from presenting a statement of recognized gains and losses to a statement of changes in equity. The condensed consolidated statement of changes in equity for the current interim period and the comparative figures have been presented in accordance with this revised SSAP.

SSAP 15 (revised) Cash flow statements

According to the revised SSAP, cash flow during the period has been reclassified by operation, investing and financing activities. The condensed consolidated cash flow statement for the current interim period and the comparative figures have been presented in accordance with the revised SSAP.

SSAP	11	(revised)	Foreign Currency Translation
SSAP	25	(revised)	Interim financial reporting
SSAP	33		Discontinuing operations
SSAP	34		Employee benefits

Apart from SSAP 1 and SSAP 15, the other new and revised SSAPs adopted during the period do not have significant impact to the Group.

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3. SEGMENT INFORMATION

Business nature Publishing of newspaper and magazine and advertising income Property rental Securities trading and investment Software development Trading of building materials and renovations services Other income Administrative expenses Loss from operations Geographical region Hong Kong Canada Other income Administrative expenses Loss from operations	Turnover Six months ended 30th September, 2002 2001 HK$’000 HK$’000 – 37,940 2,243 1,920 171,794 1,051 – 9 18,737 – 192,774 40,920 192,774 40,911 – 9 192,774 40,920	Segment results Six months ended 30th September, 2002 2001 HK$’000 HK$’000 – (12,983) 2,243 1,920 (26,233) (12,254) – (13,837) 4,832 – (19,159) (37,154) 210 2,544 (79,391) (26,506) (98,340) (61,116) (19,159) (23,317) – (13,837) (19,159) (37,154) 210 2,544 (79,391) (26,506) (98,340) (61,116)

4. LOSS FROM OPERATIONS

The loss from operations has been arrived at after charging (crediting):

	Six months ended	Six months ended
	30th September,
	2002	2001
	HK$’000	HK$’000
Amortisation of intangible asset	865	859
Depreciation and amortisation of property, plant and equipment	469	4,829
Unrealised holding losses on investment securities	64,402	13,305
Interest income	(144)	(1,340)

5. TAXATION

No provision for Hong Kong Profits Tax has been made in the financial statements as the companies comprising the Group incurred tax losses for the six month periods ended 30th September, 2001 and 30th September, 2002 respectively. No provision for overseas taxation has been made in the financial statements for the six month periods ended 30th September, 2001 and 30th September, 2002 respectively as the Group’s overseas subsidiaries have no taxable profits calculated in accordance with the tax laws of the countries in which they operate.

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6. LOSS PER SHARE

The calculation of the basic and diluted loss per share for the period, is based on the following data:

	Six months ended	Six months ended	Six months ended
	30th September,
	2002		2001
	HK$’000		HK$’000
Loss for the purpose of basic loss per share	(104,068)		(66,192)
Loss for the purpose of diluted loss per share	(104,068)		(66,192)
	Six months ended
	30th September,
	2002		2001
	Number of	Number of
	shares		shares
Weighted average number of ordinary shares for the
purposes of basic and diluted loss per share	2,786,905,314	324,466,320

No diluted loss per share have been presented for the six months ended 30th September, 2001 and 2002, as there were no potential dilutive ordinary shares in existence for the periods end assuming no exercise of the Company’s outstanding share options as the exercise price was higher than the average fair value per share.

The weighted average number of the shares for the purpose of basic and diluted loss per share for the six months ended 30th September, 2002 has been adjusted for the effect of the subdivision of the Company’s shares.

INTERIM DIVIDEND

The Board does not recommend the payment of any interim dividend for the six months ended 30th September, 2002. (2001: Nil)

BUSINESS REVIEW AND OUTLOOK

For the six months ended 30th September, 2002, the turnover of the Group increased to approximately HK$193 million from approximately HK$40.9 million compared to last corresponding period representing an increase of approximately 371%. The increase in turnover was mainly attributable to the increase in securities trading and investment and increase in trading of building materials and renovation services.

The unaudited consolidated results of the same period of the Group recorded a loss of approximately HK$104 million, as compared with a loss of approximately HK$66 million for the last corresponding period representing an increase of approximately 57%. The business of trading of building materials and renovations services that the Group acquired in last year contributed approximately 19 million and approximately 5 million to the Group’s turnover and net profit respectively. During the period under review, the Group has also completed the acquisition of Shanghai Hualong Construction Co., Limited, which is principally engaged in property development in Shanghai, the PRC.

The principal businesses of the Group continue to be property investment, development and property related services, and securities trading and investment. In October, 2002 the Group entered into a conditional

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acquisition agreement with the vendor to acquire the 51% interest in a company holding an investment in the PRC, the principal business of which is the operations of a first-class highway in Fuyang, Zhejiang Province, the PRC.

The Board believes that the PRC’s accession to the World Trade Organization will provide considerable attractions to foreign investments in the PRC which may bring to significant growth in the property market. In view of this the Group will continue to focus on the PRC market, in particular Shanghai, as it is one of the cities in the PRC which receive much attentions from the foreign countries. The Group will utilize its financial capabilities and management expertise to further exploit these potential investment opportunities in properties and related industry by the PRC market.

Financial Position

As at 30th September, 2002, the financial position of the Group remained stable and sound. The net asset was HK$334.5 million. Total borrowings stood at HK$287.1 million. The Group’s gearing ratios at 30th September 2002 were 47.7% which was calculated by dividing the total liabilities by total assets.

The Group finances its operations with its own resources. The Group maintains good business relationship and banking facilities with banks.

Employee

As at 30th September, 2002, the total number of employees of the Group was approximately 52, inclusive of its operations in the PRC and Hong Kong.

Remunerations were reviewed periodically in accordance with market situations and the performance of individual staff.

CODE OF BEST PRACTICE

None of the Directors is aware of any information that would reasonably indicate that the Company was not in compliance with the Code of Best Practice as set out in the Appendix 14 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited at any time during the six months period ended 30th September, 2002.

PUBLICATION OF INTERIM RESULTS ON THE WEBSITE OF STOCK EXCHANGE OF HONG KONG LIMITED

A detailed interim results announcement containing all the information required by paragraphs 46(1) to 46(6) of Appendix 16 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited will be published on the website of The Stock Exchange of Hong Kong Limited in due course.

By the Order of the Board Dong Bo, Frederic Chairman

Hong Kong, 24th December, 2002

“Please also refer to the published version of this announcement in The Standard”.

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