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Jardine Matheson Hldgs Ltd Half Yearly Results

04/08/2017 10:22am

UK Regulatory (RNS & others)


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TIDMJAR TIDMJDS

RNS Number : 9965M

Jardine Matheson Hldgs Ltd

04 August 2017

To: Business Editor 4th August 2017

For immediate release

The following announcement was issued today to a Regulatory Information Service approved by the Financial Conduct Authority in the United Kingdom.

Jardine Matheson Holdings Limited

Half-Yearly Results for the Six Months ended 30th June 2017

Highlights

   --     Underlying profit up 20% 
   --     Good performances from most Group companies 
   --     Strong financial position maintained 

"Following a first half with good trading performances across the Group, the level of profit growth in the second half is likely to be tempered due to fewer residential completions expected in Hongkong Land and price competition in a number of the Group's automotive markets."

Sir Henry Keswick, Chairman

Results

 
                                                                                                   (unaudited) 
                                                                                              Six months ended 
                                                                                                     30th June 
                                                                                       2017               2016  Change 
                                                                                       US$m               US$m       % 
--------------------------------------------------------------------------  ---------------  -----------------  ------ 
Gross revenue including 
 100% of associates and joint 
 ventures                                                                            38,072             34,569     +10 
Revenue                                                                              19,430             18,026      +8 
Underlying profit* attributable 
 to shareholders                                                                        765                636     +20 
Profit attributable to shareholders                                                   2,078                984    +111 
Shareholders' funds                                                                  23,886             21,800     +10 
--------------------------------------------------------------------------  ---------------  -----------------  ------ 
                                                                                        US$                US$       % 
--------------------------------------------------------------------------  ---------------  -----------------  ------ 
Underlying earnings per 
 share*                                                                                2.04               1.70     +20 
Earnings per share                                                                     5.54               2.63    +111 
Net asset value per share                                                             63.22              58.15      +9 
--------------------------------------------------------------------------  ---------------  -----------------  ------ 
                                                                                        USc                USc       % 
--------------------------------------------------------------------------  ---------------  -----------------  ------ 
Interim dividend per share                                                            40.00              38.00      +5 
--------------------------------------------------------------------------  ---------------  -----------------  ------ 
* The Group uses 'underlying profit' in its 
 internal financial reporting to distinguish 
 between ongoing business performance and non-trading 
 items, as more fully described in note 7 to 
 the condensed financial statements. Management 
 considers this to be a key measure which provides 
 additional information to enhance understanding 
 of the Group's underlying business performance. 
 At 30th June 2017 and 31st December 2016, 
 respectively. Net asset value per share is 
 based on the book value of shareholders' funds. 
---------------------------------------------------------------------------------------------------------------------- 
 

The interim dividend of USc40.00 per share will be payable on 19th October 2017 to shareholders on the register of members at the close of business on 25th August 2017 and will be available in cash with a scrip alternative.

Jardine Matheson Holdings Limited

Half-Yearly Results for the Six Months ended 30th June 2017

Overview

Jardine Matheson produced strong growth in underlying profit for the first half of 2017 with good performances from many of its businesses.

Results

The Group's underlying profit for the first six months of 2017 rose 20% to US$765 million, and underlying earnings per share were up 20% at US$2.04. The revenue of the Group for the period was 8% higher at US$19.4 billion, while revenue, including 100% of associates and joint ventures, was up 10% at US$38.1 billion.

Hongkong Land's commercial interests performed well and it recorded a higher level of sale completions in its development properties. Astra benefited from better results from across its businesses, while Permata Bank returned to profit. Jardine Pacific saw improvements in most of its operations, and Jardine Motors continued to trade well in mainland China. JLT's earnings increased despite a challenging trading environment. Dairy Farm's trading was mixed, although it did achieve higher profit contributions from certain businesses. Mandarin Oriental's results were impacted primarily by its London hotel renovation, while the contributions from Jardine Cycle & Carriage's non-Astra interests were lower.

Non-trading items in the first half represented a gain of US$1,313 million, primarily US$195 million in respect of profits on property disposals and US$1,097 million from revaluations of investment properties, compared with a non-trading gain of US$348 million in the first half of 2016. Accordingly, the Group's profit attributable to shareholders for the period was US$2,078 million for the six months under review, compared with US$984 million in 2016.

The Board has declared an increased interim dividend of USc40.00 per share.

Business Developments

The Jardine Pacific business interests were expanded to include a 28% stake in Hong Kong-listed Greatview, which was acquired through Jardine Strategic in June. Founded in mainland China, Greatview is the second-largest supplier of aseptic carton packaging in China and the third-largest globally. Jardine Pacific will be supporting Greatview's continued development, particularly in new markets in Southeast Asia.

Jardine Motors benefited from the strong trading conditions in mainland China for both Zung Fu and Zhongsheng. Following the redemption of convertible bonds issued by Zhongsheng, Jardine Strategic subscribed for additional shares in the company increasing its interest by some 5% to 20%.

JLT made further progress with the development of its Specialty business in the United States, with revenues more than doubling due to strong organic growth and a first contribution from the recently acquired Construction Risk Partners.

Hongkong Land's WF Central project in Wangfujing, Beijing is nearing completion, with the luxury retail component opening later this year and the Mandarin Oriental hotel following in 2018. In Jakarta, the fifth tower at its Jakarta Land joint venture will be ready early next year, while its prime mixed-use complex in Phnom Penh has been completed. In June, the group agreed to purchase a one-third interest in a development site within the Marina Bay Financial District in Singapore, which will be connected to its existing portfolio in the district. In addition, the group has entered two new cities in mainland China with mixed-use development projects in Wuhan and Nanjing.

In July, Dairy Farm agreed to increase its ownership in Rustan's in the Philippines to 100% with the acquisition of the remaining 34% interest from its joint venture partner. Dairy Farm is continuing to improve its appeal to customers across its range of formats through its investment in technology, supply chain infrastructure, stores and people.

Mandarin Oriental has announced a number of management contracts, including a hotel operating in Santiago, Chile, and three new hotels with branded residences being developed in Dubai, Honolulu and Melbourne which will open between 2020 and 2022. Following an announcement in June, Mandarin Oriental is pursuing strategic options for its wholly-owned hotel, The Excelsior in Hong Kong, which include the possible sale of the property for redevelopment.

During the period under review, Jardine Cycle & Carriage supported a US$500 million rights issue by Siam City Cement, and subsequently increased its shareholding in the Thai cement manufacturer to 25.5%.

Astra returned to profit growth as its net profit rose 31% under Indonesian accounting standards. Its automotive operations did well, despite increasing competition in the car market and soft demand for motorcycles, with its market shares rising to 56% for cars and 74% for motorcycles. Improvements in Permata Bank enabled it to produce a profit following a challenging year in 2016, and in June it completed a further US$220 million rights issue. Stronger commodity prices led to better performances from the group's heavy equipment and mining operations as well as its agribusiness activities.

People

Alex Newbigging is to join the Board with effect from 1st October 2017.

Outlook

Following a first half with good trading performances across the Group, the level of profit growth in the second half is likely to be tempered due to fewer residential completions expected in Hongkong Land and price competition in a number of the Group's automotive markets.

Sir Henry Keswick

Chairman

Operating Review

Jardine Pacific

Jardine Pacific achieved good earnings growth for the first half of 2017 with underlying profit up 26% at US$68 million following stronger performances in most of its operations. Jardine Schindler benefited from continued growth in new installations and in its maintenance portfolio, while JEC's businesses in Hong Kong traded well. Gammon's profit improved as the comparable period had been impacted by project timings. Trading momentum continued for Jardine Restaurants in Taiwan and Vietnam, but Hong Kong remained challenging. Increased cargo throughput enabled HACTL to produce a better performance. JTH Group's profit, however, was eroded in a weak IT market. Jardine Pacific's business portfolio now includes a 28% stake in Greatview Aseptic Packaging Company Limited, which was acquired by Jardine Strategic in June 2017.

Jardine Motors

Jardine Motors produced an excellent result in the first half of 2017 with its underlying profit 45% higher at US$83 million. The result includes a contribution from Zhongsheng, in which Jardine Strategic now holds a 20% interest. Profit attributable to shareholders was US$286 million after accounting for a US$203 million gain, principally arising from the sale of a property by Zung Fu. In mainland China, trading results from both Zung Fu and Zhongsheng were strong with good volume growth and improved margins. Zung Fu's performance in Hong Kong was stable, and work is continuing on its new showroom and workshop facilities, which will complete in mid-2018. In the United Kingdom, the performance was softer compared with 2016, when the results had also benefited from a gain on the sale of a dealership.

Jardine Lloyd Thompson

JLT produced a good performance in what remained challenging trading conditions throughout the period. Total revenue was US$877 million, an increase of 11% in its reporting currency, representing 3% organic growth. Underlying trading profit was US$140 million, an increase of 12% in its reporting currency, or 3% at constant rates of exchange. JLT's Risk & Insurance businesses recorded revenue growth of 12%, with good performances in JLT Europe, JLT Re, Latin America, Asia and the United States. The combined Employee Benefits businesses saw headline revenue growth of 8%, driven primarily by the strong performance of its UK Employee Benefits business, with revenues increasing by 9%, following its successful restructuring in 2016.

Hongkong Land

Hongkong Land's underlying profit attributable to shareholders for the first six months was US$517 million, up 32%. The profit attributable to shareholders was US$3,125 million after accounting for a net gain of US$2,608 million arising on the revaluation of investment properties. This compares with a profit of US$1,263 million in the first half of 2016, after a net revaluation gain of US$870 million.

The group's investment properties produced an increased contribution from the higher average rents achieved in Hong Kong. Vacancy in Hongkong Land's Central office portfolio at 30th June 2017 was 1.5%, compared with 2.2% at the end of 2016, while the retail portfolio was almost fully occupied. In Singapore, the performance of its office portfolio reflected the current relative surplus of market supply, although vacancy at the end of June was only 0.2% compared with 0.1% at the end of 2016, with a slight decrease in average rents.

Within Hongkong Land's development properties, being residential and mixed-use projects developed for sale in the short to medium-term, mainland China benefited from further sale completions and positive market sentiment leading to both an improved profit contribution and an increase in contracted sales. At 30th June, the group had US$1,421 million in sold but unrecognized contracted sales, compared with US$1,083 million at the end of 2016. Results from Singapore reflected the completion of the 699-unit LakeVille project, compared with no completions in the first half of 2016, and the pre-sales continuing in two other projects were satisfactory. Progress is being made in the group's other developments in Indonesia and the Philippines.

Dairy Farm

Dairy Farm's sales for the period by its subsidiaries were marginally behind last year, although flat at constant exchange rates, as declines within supermarkets and hypermarkets in the Food division were offset by sales growth in all its other divisions. Underlying net profit was up 6% at US$211 million, with reductions in the Food division being more than compensated for by strong results from Yonghui and Maxim's in addition to improved performances from the Health and Beauty and Home Furnishings divisions.

In the Food division, continuing softness in certain key markets led to sales within supermarkets and hypermarkets being 3% lower at constant exchange rates and profits declining. The group's convenience store operations traded well, and strong growth in sales and profit were achieved by Yonghui in mainland China. In the Health and Beauty division, progress was made in Hong Kong, Macau, mainland China and Indonesia, although more challenging conditions were experienced in Singapore and Malaysia. In Home Furnishings, IKEA performed well, driven by strong sales in Taiwan and Indonesia. In the Restaurants division, Maxim's delivered further growth as it continues to expand its regional presence and range of franchises.

Dairy Farm is continuing its programme of investment in its technology backbone, supply chain infrastructure, stores and people. These initiatives are supporting the expansion of the range of fresh produce and own brand products on offer, together with the introduction of enhanced e-commerce offers in many of its businesses and the innovation of new store formats in most markets. By improving the shopping experience of its customers and meeting their changing requirements, Dairy Farm is underpinning its future growth.

Mandarin Oriental

Mandarin Oriental's underlying profit for the first half was US$15 million, compared with US$25 million in 2016. Profit attributable to shareholders was also US$15 million, while in 2016 it was US$23 million. Earnings were lower during the period due to the impact of the ongoing phased renovation of its London hotel, which will complete in the second quarter of 2018, and the inclusion of a traditionally weaker first quarter result in its Boston hotel following its acquisition in April 2016. While reduced contributions were seen from Jakarta and New York, these were offset by better performances in Paris, Munich and Washington. Results across the rest of the portfolio, including Hong Kong, were broadly stable.

Mandarin Oriental currently operates 30 hotels and eight residences in 20 countries and territories, and has a strong pipeline of hotels and residences under development. Following an announcement in June, the group is pursuing strategic options for The Excelsior, Hong Kong, which include the possible sale of the property for redevelopment. The wholly-owned property, which is the group's only four star hotel, is situated on a prime commercial site that has approval for the development of a commercial building.

Jardine Cycle & Carriage

Jardine Cycle & Carriage reported an underlying profit for the period of US$375 million, up 13%, while its profit attributable to shareholders of US$399 million was up 22% with the benefit of non-trading gains. Astra's contribution to the underlying profit rose 27% to US$315 million. The contribution from the company's Direct Motor Interests was 20% lower at US$63 million, while Other Interests produced a contribution of US$8 million, down 46% compared with the first half of 2016.

The weaker result in the Direct Motor Interests reflects the impact of increasing competition, particularly for Truong Hai Auto Corporation in Vietnam. While in Singapore, Cycle & Carriage's earnings improved, results were also lower for Cycle & Carriage Bintang in Malaysia and Tunas Ridean in Indonesia. For the group's Other Interests, the 25.5%-held Siam City Cement reported a 69% decline in profit mainly due to lower prices and sales volumes in the Thai market and one-off expenses, partly offset by contributions from recent acquisitions in Sri Lanka and Vietnam. Refrigeration Electrical Engineering Corporation in Vietnam, which is 22.9%-held, performed better with improvements in most of its businesses.

Astra

Astra reported a net profit equivalent to US$702 million under Indonesian accounting standards, up 31% in its reporting currency, with improvements seen in most businesses. The group's automotive operations performed well with market shares for both cars and motorcycles rising, although it faced discount pressure as competition increased in the car market, and soft demand for motorcycles. Better results were seen from financial services with a return to profit by Permata Bank. Higher commodity prices benefited the heavy equipment and mining operations, as well as Astra's agribusiness activities. Information technology, and infrastructure and logistics saw declines in earnings.

Net income from Astra's automotive business increased by 9%, largely due to improved car sales. The wholesale market for cars in Indonesia grew marginally to 534,000 units, while the group's car sales were up 9% at 298,000 units, resulting in its market share rising from 51% to 56%. The wholesale market for motorcycles contracted by 9% to 2.7 million units, while Astra Honda Motor's domestic sales fell by 7% to 2.0 million units, with its market share increasing from 73% to 74%. Net income rose 30% in its components business, Astra Otoparts.

Within Astra's financial services business, net income rose 62% to US$153 million with better contributions from most activities. The consumer finance businesses saw the aggregate amount financed increase by 8% to US$2.9 billion, while heavy equipment financing was up 68% to US$237 million. Permata Bank's financial position stabilized and it reported a net income of US$47 million for the period compared with a net loss of US$62 million in the first half of 2016. The bank benefited from an improvement in asset quality and the sale of a portfolio of its non-performing loans. Asuransi Astra Buana, the group's general insurance company, reported net income up 24% due to higher underwriting and investment income, while Astra Aviva Life continued to grow its customer base.

United Tractors, which is 60%-owned, reported net income up 85% at US$257 million, as its businesses benefited from increased coal prices. In construction machinery, Komatsu heavy equipment sales were up 69% and revenues from parts and service also rose. Mining contracting within Pamapersada Nusantara recorded increases of 4% in coal production and 6% in overburden removal, although United Tractors' mining subsidiaries saw coal sales reduce by 18% to 3.6 million tonnes. Acset Indonusa, the 50%-held general contractor, reported improved earnings and contracts worth US$536 million secured during the period. Bhumi Jati Power, which is 25%-owned, is constructing two power plants in Central Java that are scheduled to start commercial operations in 2021, while Suprabari Mapanindo Mineral, an 80%-owned coking coal company in Central Kalimantan, is expected to start production by the end of 2017.

Astra Agro Lestari, which is 80%-owned, saw its net income rise during the period by 32% to US$78 million. Revenue benefited from higher crude palm oil prices and increased production. Average crude palm oil prices achieved were up 16%, while sales of crude palm oil and its derivatives rose 10% to 833,000 tonnes.

The contribution from Astra's infrastructure and logistics business was down 21% to US$8 million, mainly due to initial losses arising on toll roads and lower earnings from its water utility business following a 3% decrease in sales. The group continues to develop its toll road activities which, including interests in 51km of greenfield sites, now extend to 353km. Serasi Autoraya's net income rose due to higher net margins in its car leasing and rental business.

Astra's information technology business saw lower earnings as Astra Graphia reported net income down 25% at US$5 million, mainly due to lower revenue from its IT solutions business. Within Astra's property activities, net income reflected improved development earnings recognized under Indonesian accounting standards on its Anandamaya Residences development, which will complete in 2018.

 
 
Jardine Matheson Holdings Limited 
 Consolidated Profit and Loss 
 Account 
 
 
                                                                                           (unaudited) 
                                                                                   Six months ended 30th June                             Year ended 31st December 
                                                                                2017                                 2016                                 2016 
 
 
                                                            Underlying                           Underlying                           Underlying 
                                                              business   Non-trading               business   Non-trading               business   Non-trading 
                                                           performance         items     Total  performance         items     Total  performance         items     Total 
                                                                  US$m          US$m      US$m         US$m          US$m      US$m         US$m          US$m      US$m 
 
 
Revenue (note 2)                                                19,430             -    19,430       18,026             -    18,026       37,051             -    37,051 
Net operating costs (note 
 3)                                                           (17,812)           222  (17,590)     (16,622)           (6)  (16,628)     (33,905)            93  (33,812) 
Change in fair value 
 of investment properties                                            -         2,694     2,694            -           986       986            -         2,573     2,573 
                                                              --------  ------------  --------  -----------  ------------  --------  -----------  ------------  -------- 
 
Operating profit                                                 1,618         2,916     4,534        1,404           980     2,384        3,146         2,666     5,812 
Net financing charges 
                                                              --------  ------------  --------  -----------  ------------  --------  -----------  ------------  -------- 
 
- financing charges                                              (163)             -     (163)        (145)             -     (145)        (297)             -     (297) 
- financing income                                                  85             -        85           69             -        69          146             -       146 
 
 
                                                                  (78)             -      (78)         (76)             -      (76)        (151)             -     (151) 
Share of results of associates 
 and joint ventures (note 
 4) 
 
 
  *    before change in fair value of investment properties        590             9       599          398          (11)       387          734             7       741 
 
  *    change in fair value of investment properties                 -          (56)      (56)            -         (121)     (121)            -          (56)      (56) 
 
 
                                                                   590          (47)       543          398         (132)       266          734          (49)       685 
 
Profit before tax                                                2,130         2,869     4,999        1,726           848     2,574        3,729         2,617     6,346 
Tax (note 5)                                                     (377)           (4)     (381)        (315)             1     (314)        (654)           (5)     (659) 
                                                              --------  ------------  --------  -----------  ------------  --------  -----------  ------------  -------- 
 
Profit after tax                                                 1,753         2,865     4,618        1,411           849     2,260        3,075         2,612     5,687 
                                                              --------  ------------  --------  -----------  ------------  --------  -----------  ------------  -------- 
 
Attributable to: 
Shareholders of the Company 
 (notes 6 & 7)                                                     765         1,313     2,078          636           348       984        1,386         1,117     2,503 
Non-controlling interests                                          988         1,552     2,540          775           501     1,276        1,689         1,495     3,184 
                                                              --------  ------------  --------  -----------  ------------  --------  -----------  ------------  -------- 
 
                                                                 1,753         2,865     4,618        1,411           849     2,260        3,075         2,612     5,687 
                                                              --------  ------------  --------  -----------  ------------  --------  -----------  ------------  -------- 
 
                                                                   US$                     US$          US$                     US$          US$                     US$ 
 
 
Earnings per share (note 
 6) 
- basic                                                           2.04                    5.54         1.70                    2.63         3.71                    6.69 
- diluted                                                         2.03                    5.53         1.70                    2.63         3.70                    6.68 
                                                              --------                --------  -----------                --------  -----------                -------- 
 
 
 
 
Jardine Matheson Holdings Limited 
 Consolidated Statement of Comprehensive 
 Income 
 
 
                                                    (unaudited)  Year ended 
                                               Six months ended        31st 
                                                      30th June    December 
                                                 2017      2016        2016 
                                                 US$m      US$m        US$m 
 
 
Profit for the period                           4,618     2,260       5,687 
Other comprehensive income/(expense) 
 
 
Items that will not be reclassified 
 to profit or loss: 
                                                       -------- 
 
Remeasurements of defined benefit 
 plans                                            (2)       (4)          23 
Net revaluation surplus before 
 transfer to investment properties 
- intangible assets                                 -        93         105 
- tangible assets                                   -         1           2 
Tax on items that will not be 
 reclassified                                       1         1        (10) 
 
 
                                                  (1)        91         120 
  Share of other comprehensive income/ 
   (expense) of associates and joint 
   ventures                                        10      (34)        (25) 
                                            ---------  --------  ---------- 
 
                                                    9        57          95 
Items that may be reclassified 
 subsequently to profit or loss: 
 
Net exchange translation differences 
                                            ---------  --------  ---------- 
 
- net gain/(loss) arising during 
 the period                                       148       353       (139) 
- transfer to profit and loss                       -         -         (3) 
 
 
                                                  148       353       (142) 
Revaluation of other investments 
                                            ---------  --------  ---------- 
 
- net gain/(loss) arising during 
 the period                                        97       (8)         113 
- transfer to profit and loss                     (5)         -           - 
 
 
                                                   92       (8)         113 
Cash flow hedges 
                                            ---------  --------  ---------- 
 
- net loss arising during the 
 period                                          (54)      (22)       (173) 
- transfer to profit and loss                       7        17         186 
 
 
                                                 (47)       (5)          13 
Tax relating to items that may 
 be reclassified                                    9         4           1 
 
   Share of other comprehensive income/ 
    (expense) of associates and joint 
    ventures                                      262       164       (213) 
                                            ---------  --------  ---------- 
 
                                                  464       508       (228) 
 
 
   Other comprehensive income/(expense) 
    for the period, net of tax                    473       565       (133) 
                                            ---------  --------  ---------- 
 
Total comprehensive income for 
 the period                                     5,091     2,825       5,554 
                                            ---------  --------  ---------- 
 
Attributable to: 
Shareholders of the Company                     2,358     1,101       2,310 
Non-controlling interests                       2,733     1,724       3,244 
                                            ---------  --------  ---------- 
 
                                                5,091     2,825       5,554 
                                            ---------  --------  ---------- 
 
 
 
 
Jardine Matheson Holdings Limited 
 Consolidated Balance Sheet 
 
 
                                                (unaudited)    At 31st 
                                               At 30th June   December 
                                        2017           2016       2016 
                                        US$m           US$m       US$m 
 
 
Assets 
Intangible assets                      3,245          2,859      2,825 
Tangible assets                        6,619          6,289      6,239 
Investment properties                 31,324         26,930     28,609 
Bearer plants                            512            528        497 
Associates and joint ventures         12,006         10,448     10,595 
Other investments                      1,286          1,141      1,369 
Non-current debtors                    3,238          2,923      2,936 
Deferred tax assets                      404            333        375 
Pension assets                             4              4          5 
                                      ------  -------------  --------- 
 
Non-current assets                    58,638         51,455     53,450 
                                      ------  -------------  --------- 
 
Properties for sale                    2,103          2,811      2,315 
Stocks and work in progress            3,342          3,139      3,281 
Current debtors                        6,660          6,468      6,697 
Current investments                       50             47         65 
Current tax assets                       165            211        169 
Bank balances and other liquid 
 funds 
                                      ------  -------------  --------- 
 
- non-financial services companies     5,663          4,624      5,314 
- financial services companies           234            352        229 
 
 
                                       5,897          4,976      5,543 
                                      ------  -------------  --------- 
 
                                      18,217         17,652     18,070 
Non-current assets classified as 
 held for sale                             3              -          3 
                                      ------  -------------  --------- 
 
Current assets                        18,220         17,652     18,073 
                                      ------  -------------  --------- 
 
 
 
Total assets                          76,858         69,107     71,523 
                                      ------  -------------  --------- 
 
 
 
 
 
Equity 
Share capital                             180      178      178 
Share premium and capital reserves        181      168      175 
Revenue and other reserves             28,005   24,333   25,547 
Own shares held                       (4,480)  (3,963)  (4,100) 
                                      -------  -------  ------- 
 
Shareholders' funds                    23,886   20,716   21,800 
Non-controlling interests              30,119   26,721   27,937 
                                      -------  -------  ------- 
 
Total equity                           54,005   47,437   49,737 
                                      -------  -------  ------- 
 
Liabilities 
Long-term borrowings 
                                      -------  -------  ------- 
 
- non-financial services companies      5,139    5,735    5,343 
- financial services companies          1,510    1,765    1,518 
 
 
                                        6,649    7,500    6,861 
Deferred tax liabilities                  580      478      500 
Pension liabilities                       443      439      419 
Non-current creditors                     505      436      440 
Non-current provisions                    163      156      151 
                                      -------  -------  ------- 
 
Non-current liabilities                 8,340    9,009    8,371 
                                      -------  -------  ------- 
 
Current creditors                       9,206    8,430    8,714 
Current borrowings 
                                      -------  -------  ------- 
 
- non-financial services companies      2,447    1,902    2,058 
- financial services companies          2,410    1,937    2,265 
 
 
                                        4,857    3,839    4,323 
Current tax liabilities                   344      295      266 
Current provisions                        106       97      112 
                                      -------  -------  ------- 
 
Current liabilities                    14,513   12,661   13,415 
                                      -------  -------  ------- 
 
Total liabilities                      22,853   21,670   21,786 
                                      -------  -------  ------- 
 
 
 
Total equity and liabilities           76,858   69,107   71,523 
                                      -------  -------  ------- 
 
 
 
 
 
Jardine Matheson 
Holdings Limited 
Consolidated 
Statement of 
Changes 
in Equity 
 
 
                                                                                                  Attributable 
                                                                                                            to     Attributable 
                                                              Asset                          Own  shareholders               to 
                    Share    Share   Capital   Revenue  revaluation   Hedging  Exchange   shares        of the  non-controlling   Total 
                  capital  premium  reserves  reserves     reserves  reserves  reserves     held       Company        interests  equity 
                     US$m     US$m      US$m      US$m         US$m      US$m      US$m     US$m          US$m             US$m    US$m 
 
 
Six months ended 
30th June 2017 
(unaudited) 
At 1st January 
 2017                 178       20       155    27,223          210      (32)   (1,854)  (4,100)        21,800           27,937  49,737 
Total 
 comprehensive 
 income                 -        -         -     2,152            -         4       202        -         2,358            2,733   5,091 
Dividends paid 
 by the Company 
 (note 8)               -        -         -     (420)            -         -         -        -         (420)               75   (345) 
Dividends paid 
 to 
 non-controlling 
 interests              -        -         -         -            -         -         -        -             -            (550)   (550) 
Issue of shares         -        9         -         -            -         -         -        -             9                -       9 
Employee share 
 option schemes         -        -        11         -            -         -         -        -            11                1      12 
Scrip issued in 
 lieu of 
 dividends              2      (2)         -       552            -         -         -        -           552                -     552 
Increase in own 
 shares held            -        -         -         -            -         -         -    (380)         (380)             (75)   (455) 
Subsidiaries 
 acquired               -        -         -         -            -         -         -        -             -                7       7 
Change in 
 interests in 
 subsidiaries           -        -         -      (15)            -         -         -        -          (15)              (9)    (24) 
Change in 
 interests in 
 associates 
 and joint 
 ventures               -        -         -      (29)            -         -         -        -          (29)                -    (29) 
Transfer                -        5      (17)        12            -         -         -        -             -                -       - 
 
At 30th June 
 2017                 180       32       149    29,475          210      (28)   (1,652)  (4,480)        23,886           30,119  54,005 
                  -------  -------  --------  --------  -----------  --------  --------  -------  ------------  ---------------  ------ 
 
Six months ended 
30th June 2016 
(unaudited) 
At 1st January 
 2016                 175       21       137    24,578          176      (14)   (1,591)  (3,596)        19,886           25,614  45,500 
Total 
 comprehensive 
 income                 -        -         -       938           30      (17)       150        -         1,101            1,724   2,825 
Dividends paid 
 by the Company 
 (note 8)               -        -         -     (399)            -         -         -        -         (399)               72   (327) 
Dividends paid 
 to 
 non-controlling 
 interests              -        -         -         -            -         -         -        -             -            (530)   (530) 
Issue of shares         -        1         -         -            -         -         -        -             1                -       1 
Employee share 
 option schemes         -        -        12         -            -         -         -        -            12                1      13 
Scrip issued in 
 lieu of 
 dividends              3      (3)         -       515            -         -         -        -           515                -     515 
Increase in own 
 shares held            -        -         -         -            -         -         -    (367)         (367)             (57)   (424) 
Capital 
 contribution 
 from 
 non-controlling 
 interests              -        -         -         -            -         -         -        -             -               76      76 
Change in 
 interests in 
 subsidiaries           -        -         -      (31)            -         -         -        -          (31)            (179)   (210) 
Change in 
 interests in 
 associates 
 and joint 
 ventures               -        -         -       (2)            -         -         -        -           (2)                -     (2) 
Transfer                -        1       (1)         -            -         -         -        -             -                -       - 
 
At 30th June 
 2016                 178       20       148    25,599          206      (31)   (1,441)  (3,963)        20,716           26,721  47,437 
                  -------  -------  --------  --------  -----------  --------  --------  -------  ------------  ---------------  ------ 
 
 
 
Year ended 31st 
December 2016 
At 1st January 
 2016                 175       21       137    24,578          176      (14)   (1,591)  (3,596)        19,886           25,614  45,500 
Total 
 comprehensive 
 income                 -        -         -     2,558           34      (18)     (264)        -         2,310            3,244   5,554 
Dividends paid 
 by the Company         -        -         -     (541)            -         -         -        -         (541)               97   (444) 
Dividends paid 
 to 
 non-controlling 
 interests              -        -         -         -            -         -         -        -             -            (778)   (778) 
Unclaimed 
 dividends 
 forfeited              -        -         -         1            -         -         -        -             1                -       1 
Issue of shares         -        1         -         -            -         -         -        -             1                -       1 
Employee share 
 option schemes         -        -        22         -            -         -         -        -            22                1      23 
Scrip issued in 
 lieu of 
 dividends              3      (3)         -       700            -         -         -        -           700                -     700 
Increase in own 
 shares held            -        -         -         -            -         -         -    (504)         (504)             (73)   (577) 
Capital 
 contribution 
 from 
 non-controlling 
 interests              -        -         -         -            -         -         -        -             -               83      83 
Change in 
 interests in 
 subsidiaries           -        -         -      (74)            -         -         1        -          (73)            (251)   (324) 
Change in 
 interests in 
 associates 
 and joint 
 ventures               -        -         -       (2)            -         -         -        -           (2)                -     (2) 
Transfer                -        1       (4)         3            -         -         -        -             -                -       - 
                  -------  -------  --------  --------  -----------  --------  --------  -------  ------------  ---------------  ------ 
 
At 31st December 
 2016                 178       20       155    27,223          210      (32)   (1,854)  (4,100)        21,800           27,937  49,737 
                  -------  -------  --------  --------  -----------  --------  --------  -------  ------------  ---------------  ------ 
 

Total comprehensive income for the six months ended 30th June 2017 included in revenue reserves comprises profit attributable to shareholders of the Company of US$2,078 million (2016: US$984 million) and net fair value gain on other investments of US$64 million (2016: net fair value loss of US$13 million). Cumulative net fair value gain on other investments amounted to US$411 million.

Total comprehensive income for the year ended 31st December 2016 included in revenue reserves comprises profit attributable to shareholders of the Company of US$2,503 million and net fair value gain on other investments of US$94 million. Cumulative net fair value gain on other investments amounted to US$347 million.

______________________________________________________________________________________________________________________________________________________

 
 
Jardine Matheson Holdings Limited 
 Consolidated Cash Flow Statement 
 
 
                                                         (unaudited) 
                                                    Six months ended      Year ended 
                                                           30th June   31st December 
                                                      2017      2016            2016 
                                                      US$m      US$m            US$m 
 
 
Operating activities 
                                                 ---------  --------  -------------- 
 
Operating profit                                     4,534     2,384           5,812 
Change in fair value of investment properties      (2,694)     (986)         (2,573) 
Depreciation and amortization                          476       466             945 
Other non-cash items                                  (69)       109             120 
Increase in working capital                           (42)     (186)            (94) 
Interest received                                       79        68             136 
Interest and other financing charges 
 paid                                                (172)     (141)           (289) 
Tax paid                                             (316)     (335)           (704) 
                                                 ---------  --------  -------------- 
 
                                                     1,796     1,379           3,353 
Dividends from associates and joint 
 ventures                                              534       341             597 
 
 
Cash flows from operating activities                 2,330     1,720           3,950 
 
Investing activities 
                                                 ---------  --------  -------------- 
 
Purchase of subsidiaries (note 10(a))                 (24)      (49)            (60) 
Purchase of associates and joint ventures 
 (note 10(b))                                      (1,079)     (221)           (652) 
Purchase of other investments (note 
 10(c))                                              (148)      (69)           (294) 
Purchase of intangible assets                         (95)      (64)           (142) 
Purchase of tangible assets                          (560)     (495)           (996) 
Additions to investment properties                   (217)     (136)           (313) 
Additions to bearer plants                            (19)      (28)            (56) 
Advance to associates and joint ventures 
 (note 10(d))                                        (304)       (3)            (81) 
Advance and repayment from associates 
 and joint ventures (note10(e))                        232        33             175 
Sale of subsidiaries                                    14        15              16 
Sale of associates and joint ventures                   20         -               5 
Redemption of convertible bonds in Zhongsheng          398         -               - 
Sale of other investments (note 10(f))                 117        34             122 
Sale of intangible assets                                1         3               8 
Sale of tangible assets                                210        38             204 
Sale of investment properties                           42         1               1 
 
 
Cash flows from investing activities               (1,412)     (941)         (2,063) 
 
Financing activities 
                                                 ---------  --------  -------------- 
 
Issue of shares                                          5         1               1 
Capital contribution from non-controlling 
 interests                                               -        76              77 
Change in interests in subsidiaries 
 (note 10(g))                                          (9)     (210)           (339) 
Drawdown of borrowings                              12,813    11,638          23,629 
Repayment of borrowings                           (12,683)  (11,428)        (23,314) 
Dividends paid by the Company                        (248)     (236)           (322) 
Dividends paid to non-controlling interests          (555)     (532)           (783) 
 
 
Cash flows from financing activities                 (677)     (691)         (1,051) 
                                                 ---------  --------  -------------- 
 
Net increase in cash and cash equivalents              241        88             836 
Cash and cash equivalents at beginning 
 of period                                           5,531     4,773           4,773 
Effect of exchange rate changes                         68        49            (78) 
                                                 ---------  --------  -------------- 
 
Cash and cash equivalents at end of 
 period                                              5,840     4,910           5,531 
                                                 ---------  --------  -------------- 
 
 
 
 
Jardine Matheson Holdings Limited 
 Analysis of Profit Contribution 
 
 
                                                      (unaudited) 
                                                 Six months ended      Year ended 
                                                        30th June   31st December 
                                                   2017      2016            2016 
                                                   US$m      US$m            US$m 
 
 
Reportable segments 
Jardine Pacific                                      68        54             135 
Jardine Motors                                       83        57             126 
Jardine Lloyd Thompson                               36        31              56 
Hongkong Land                                       216       163             353 
Dairy Farm                                          137       128             297 
Mandarin Oriental                                    10        15              36 
Jardine Cycle & Carriage                             45        58             125 
Astra                                               198       155             312 
                                              ---------  --------  -------------- 
 
                                                    793       661           1,440 
Corporate and other interests                      (28)      (25)            (54) 
                                              ---------  --------  -------------- 
 
Underlying profit attributable 
 to shareholders*                                   765       636           1,386 
Increase in fair value of investment 
 properties                                       1,097       363           1,061 
Other non-trading items                             216      (15)              56 
                                              ---------  --------  -------------- 
 
Profit attributable to shareholders               2,078       984           2,503 
                                              ---------  --------  -------------- 
 
Analysis of Jardine Pacific's contribution 
Jardine Schindler                                    23        20              44 
JEC                                                   6         6              28 
Gammon                                               16         8              18 
Jardine Restaurants                                  16        14              28 
Transport Services                                   11         6              17 
JTH Group                                             -         3               9 
Corporate and other interests                       (4)       (3)             (9) 
                                              ---------  --------  -------------- 
 
                                                     68        54             135 
                                              ---------  --------  -------------- 
 
Analysis of Jardine Motors' contribution 
Hong Kong and mainland China                         76        35              98 
United Kingdom                                        8        23              30 
Corporate                                           (1)       (1)             (2) 
                                              ---------  --------  -------------- 
 
                                                     83        57             126 
                                              ---------  --------  -------------- 
 

* Underlying profit attributable to shareholders is the measure of profit adopted by the Group in accordance with IFRS 8 'Operating Segments'.

__________________________________________________________________________________________

 
 
Jardine Matheson Holdings Limited 
 Notes to Condensed Financial Statements 
 
 
   1.    Accounting Policies and Basis of Preparation 

The condensed financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting'. The condensed financial statements have been prepared on a going concern basis. The condensed financial statements have not been audited or reviewed by the Group's auditors pursuant to the UK Auditing Practices Board guidance on the review of interim financial information.

There are no new standards or amendments, which are effective in the current accounting period and relevant to the Group's operations, that have a significant effect on the Group's accounting policies. There have been no changes to the accounting policies described in the 2016 annual financial statements.

   2.    Revenue 
 
                                                   Six months ended 30th June 
 
                                          Gross revenue                           Revenue 
 
                                           2017              2016         2017         2016 
                                           US$m              US$m         US$m         US$m 
 
 
 By business: 
 Jardine Pacific                          3,003             2,879        1,112        1,120 
 Jardine Motors                           2,737             2,595        2,737        2,595 
 Jardine Lloyd Thompson                     877               881            -            - 
 Hongkong Land                            2,381             1,209        1,297          783 
 Dairy Farm                              10,448            10,110        5,505        5,562 
 Mandarin Oriental                          462               469          287          288 
 Jardine Cycle & Carriage                 3,446             3,276        1,150        1,120 
 Astra                                   14,850            13,271        7,369        6,583 
 Intersegment transactions                (132)             (121)         (27)         (25) 
                              -----------------  ----------------  -----------  ----------- 
 
                                         38,072            34,569       19,430       18,026 
                              -----------------  ----------------  -----------  ----------- 
 

Gross revenue comprises revenue together with 100% of revenue from associates and joint ventures.

   3.    Net Operating Costs 
 
                                       Six months ended 30th June 
 
                                                   2017      2016 
                                                   US$m      US$m 
 
 
 Cost of sales                                 (14,886)  (13,845) 
 Other operating income                             481       239 
 Selling and distribution costs                 (2,152)   (2,073) 
 Administration expenses                          (972)     (905) 
 Other operating expenses                          (61)      (44) 
                                               --------  -------- 
 
                                               (17,590)  (16,628) 
                                               --------  -------- 
 
 Net operating costs included the following 
  gains/(losses) from non-trading items: 
 
 Sale of property interests                         195         - 
 Sale of businesses                                   4         - 
 Change in interests in associates and 
  joint ventures                                     13       (4) 
 Value added tax recovery in Jardine Motors          10         - 
 Acquisition-related costs                            -       (2) 
 
                                                    222       (6) 
                                               --------  -------- 
 
   4.    Share of Results of Associates and Joint Ventures 
 
                                      Six months ended 30th June 
 
                                                     2017   2016 
                                                     US$m   US$m 
 
 By business: 
 Jardine Pacific                                       55     38 
 Jardine Lloyd Thompson                                36     20 
 Hongkong Land                                         58   (61) 
 Dairy Farm                                            62     46 
 Mandarin Oriental                                      3      5 
 Jardine Cycle & Carriage                              57     69 
 Astra                                                271    148 
 Corporate and other interests                          1      1 
                                                    -----  ----- 
 
                                                      543    266 
                                                    -----  ----- 
 
 Share of results of associates and joint 
  ventures included the following gains/(losses) 
  from non-trading items: 
 
 Change in fair value of investment properties       (56)  (121) 
 Change in interest in an associate                     8      - 
 Sale of businesses                                     1    (1) 
 Litigation costs                                       -   (10) 
 
                                                     (47)  (132) 
                                                    -----  ----- 
 

Results are shown after tax and non-controlling interests in the associates and joint ventures.

   5.    Tax 
 
                                        Six months ended 30th June 
 
                                                       2017   2016 
                                                       US$m   US$m 
 
 
 Tax charged to profit and loss is analyzed 
  as follows: 
 
 Current tax                                          (397)  (337) 
 Deferred tax                                            16     23 
                                                      -----  ----- 
 
                                                      (381)  (314) 
                                                      -----  ----- 
 
 Greater China                                        (144)  (133) 
 Southeast Asia                                       (232)  (173) 
 United Kingdom                                         (3)    (5) 
 Rest of the world                                      (2)    (3) 
                                                      -----  ----- 
 
                                                      (381)  (314) 
                                                      -----  ----- 
 
 Tax relating to components of other comprehensive 
  income or expense is analyzed as follows: 
 
 Remeasurements of defined benefit plans                  1      1 
 Cash flow hedges                                         9      4 
 
                                                         10      5 
                                                      -----  ----- 
 

Tax on profits has been calculated at rates of taxation prevailing in the territories in which the Group operates.

Share of tax charge of associates and joint ventures of US$228 million and US$5 million (2016: charge of US$105 million and credit of US$14 million) are included in share of results of associates and joint ventures and share of other comprehensive income of associates and joint ventures, respectively.

   6.    Earnings per Share 

Basic earnings per share are calculated on profit attributable to shareholders of US$2,078 million (2016: US$984 million) and on the weighted average number of 375 million (2016: 374 million) shares in issue during the period.

Diluted earnings per share are calculated on profit attributable to shareholders of US$2,078 million (2016: US$984 million), which is after adjusting for the effects of the conversion of dilutive potential ordinary shares of subsidiaries, associates or joint ventures, and on the weighted average number of 376 million (2016: 374 million) shares after adjusting for the number of shares which are deemed to be issued for no consideration under the Senior Executive Share Incentive Schemes based on the average share price during the period.

The weighted average number of shares is arrived at as follows:

 
                                                             Ordinary shares 
                                                               in millions 
                                                           2017          2016 
 
 
 Weighted average number of shares in issue                 716           704 
 Company's share of shares held by subsidiaries           (341)         (330) 
                                                   ------------  ------------ 
 
    Weighted average number of shares for 
     basic earnings 
     per share calculation                                  375           374 
    Adjustment for shares deemed to be issued 
     for no consideration under the Senior 
     Executive Share 
     Incentive Schemes                                        1             - 
                                                   ------------  ------------ 
 
 Weighted average number of shares for 
  diluted earnings per share calculation                    376           374 
                                                   ------------  ------------ 
 

Additional basic and diluted earnings per share are also calculated based on underlying profit attributable to shareholders. A reconciliation of earnings is set out below:

 
                                                Six months ended 30th June 
 
                                           2017                             2016 
                                          Basic      Diluted               Basic     Diluted 
                                       earnings     earnings            earnings    earnings 
                                      per share    per share           per share   per share 
                              US$m          US$          US$    US$m         US$         US$ 
 
 
 Profit attributable 
  to shareholders            2,078         5.54         5.53     984        2.63        2.63 
 Non-trading items (note 
  7)                       (1,313)                             (348) 
                           -------                            ------ 
 
 Underlying profit 
  attributable 
  to shareholders              765         2.04         2.03     636        1.70        1.70 
                           -------                            ------ 
 
   7.    Non-trading items 

Non-trading items are separately identified to provide greater understanding of the Group's underlying business performance. Items classified as non-trading items include fair value gains or losses on revaluation of investment properties; gains and losses arising from the sale of businesses, investments and properties; impairment of non-depreciable intangible assets and other investments; provisions for the closure of businesses; acquisition-related costs in business combinations; and other credits and charges of a non-recurring nature that require inclusion in order to provide additional insight into underlying business performance.

 
                                    Six months ended 30th June 
 
                                                   2017   2016 
                                                   US$m   US$m 
 
 
 By business: 
 Jardine Pacific                                      5      - 
 Jardine Motors                                     203      - 
 Jardine Lloyd Thompson                               -   (11) 
 Hongkong Land                                    1,090    363 
 Dairy Farm                                           1      - 
 Mandarin Oriental                                    -    (1) 
 Jardine Cycle & Carriage                             5    (3) 
 Astra                                                9      - 
 
                                                  1,313    348 
                                                  -----  ----- 
 
 An analysis of non-trading items after 
  interest, tax and non-controlling interests 
  is set out below: 
 
 Change in fair value of investment properties 
 - Hongkong Land                                  1,090    363 
 - other                                              7      - 
 Sale of property interests                         195      - 
 Sale of businesses                                   5    (1) 
 Change in interests in associates and 
  joint ventures                                      8    (3) 
 Value added tax recovery in Jardine Motors           8      - 
 Litigation costs                                     -   (10) 
 Acquisition-related costs                            -    (1) 
 
                                                  1,313    348 
                                                  -----  ----- 
 
 
   8.    Dividends 
 
                                       Six months ended 30th June 
 
                                                      2017   2016 
                                                      US$m   US$m 
 
 
   Final dividend in respect of 2016 of USc112.00 
    (2015: USc107.00) per share                        800    751 
 Company's share of dividends paid on the 
  shares held by subsidiaries                        (380)  (352) 
                                                     -----  ----- 
 
                                                       420    399 
                                                     -----  ----- 
 

An interim dividend in respect of 2017 of USc40.00 (2016: USc38.00) per share amounting to a total of US$289 million (2016: US$270 million) is declared by the Board. The net amount after deducting the Company's share of the dividends payable on the shares held by subsidiaries of US$139 million (2016: US$128 million) will be accounted for as an appropriation of revenue reserves in the year ending 31st December 2017.

   9.    Financial Instruments 

Financial instruments by category

The fair values of financial assets and financial liabilities, together with carrying amounts at 30th June 2017 and 31st December 2016 are as follows:

 
                                                                                  Other 
                                                                     Other    financial 
                                                                 financial  instruments 
                                                               instruments   fair value 
                               Loans  Derivatives                       at      through     Total 
                                 and     used for  Available-    amortized       profit  carrying      Fair 
                         receivables      hedging    for-sale         cost     and loss    amount     value 
                                US$m         US$m        US$m         US$m         US$m      US$m      US$m 
 
 
 30th June 2017 
 Assets 
 Other investments                 -            -       1,332            -            -     1,332     1,332 
 Debtors                       8,445           59           -            -           12     8,516     8,521 
 Bank balances 
  and other liquid 
  funds                        5,897            -           -            -            -     5,897     5,897 
                         -----------  ----------- 
 
                              14,342           59       1,332            -           12    15,745    15,750 
                         -----------  -----------  ----------  -----------  -----------  --------  -------- 
 
 Liabilities 
   Borrowings 
    (excluding finance 
    lease liabilities)             -            -           -     (11,456)            -  (11,456)  (11,594) 
    Finance lease 
     liabilities                   -            -           -         (50)            -      (50)      (50) 
   Trade and other 
    payables excluding 
    non-financial 
    liabilities                    -         (59)           -      (7,713)         (10)   (7,782)   (7,782) 
                         -----------  -----------  ----------  -----------  -----------  --------  -------- 
 
                                   -         (59)           -     (19,219)         (10)  (19,288)  (19,426) 
                         -----------  -----------  ----------  -----------  -----------  --------  -------- 
 
 31st December 
  2016 
 Assets 
 Other investments                 -            -       1,427            -            -     1,427     1,427 
 Debtors                       8,271          119           -            -           12     8,402     8,323 
   Bank balances 
    and 
    other liquid funds         5,543            -           -            -            -     5,543     5,543 
                         -----------  -----------  ----------  -----------  -----------  --------  -------- 
 
                              13,814          119       1,427            -           12    15,372    15,293 
                         -----------  -----------  ----------  -----------  -----------  --------  -------- 
 
 Liabilities 
   Borrowings 
    (excluding finance 
    lease liabilities)             -            -           -     (11,129)            -  (11,129)  (11,214) 
    Finance lease 
     liabilities                   -            -           -         (55)            -      (55)      (55) 
   Trade and other 
    payables excluding 
    non-financial 
    liabilities                    -         (29)           -      (7,104)         (10)   (7,143)   (7,143) 
                         -----------  -----------  ----------  -----------  -----------  --------  -------- 
 
                                   -         (29)           -     (18,288)         (10)  (18,327)  (18,412) 
                         -----------  -----------  ----------  -----------  -----------  --------  -------- 
 

Fair value estimation

(i) Financial instruments that are measured at fair value

For financial instruments that are measured at fair value in the balance sheet, the corresponding fair value measurements are disclosed by level of the following fair value measurement hierarchy:

(a) Quoted prices (unadjusted) in active markets for identical assets or liabilities ('quoted prices in active markets')

The fair values of listed securities, which are classified as available-for-sale, are based on quoted prices in active markets at the balance sheet date. The quoted market price used for listed investments held by the Group is the current bid price.

(b) Inputs other than quoted prices in active markets that are observable for the asset or liability, either directly or indirectly ('observable current market transactions')

The fair values of derivative financial instruments are determined using rates quoted by the Group's bankers at the balance sheet date. The rates for interest rate swaps and caps, cross-currency swaps, forward foreign exchange contracts and credit default swaps are calculated by reference to market interest rates and foreign exchange rates.

The fair values of unlisted investments, which are classified as available-for-sale and mainly include club and school debentures, are determined using prices quoted by brokers at the balance sheet date.

(c) Inputs for assets or liabilities that are not based on observable market data ('unobservable inputs')

The fair values of other unlisted securities, which are classified as available-for-sale, are determined using valuation techniques by reference to observable current market transactions (including price-to earnings and price-to book ratios of listed securities of entities engaged in similar industries) or the market prices of the underlying investments with certain degree of entity specific estimates. The fair value of convertible component of convertible bonds held is made reference to the quoted price of the underlying shares and estimation on volatility.

There were no changes in valuation techniques during the six months ended 30th June 2017 and the year ended 31st December 2016.

The table below analyzes financial instruments carried at fair value at 30th June 2017 and 31st December 2016, by the levels in the fair value measurement hierarchy:

 
                                                 Quoted    Observable 
                                                 prices       current 
                                              in active        market  Unobservable 
                                                markets  transactions        inputs  Total 
                                                   US$m          US$m          US$m   US$m 
 
 
  30th June 2017 
  Assets 
  Available-for-sale financial 
   assets 
                                              ---------  ------------  ------------  ----- 
 
  - listed securities                             1,229             -             -  1,229 
  - unlisted investments                              -            46            57    103 
 
 
                                                  1,229            46            57  1,332 
  Derivative designated at 
   fair value 
 
    *    through other comprehensive income           -            42             -     42 
 
    *    through profit and loss                      -            17             -     17 
 
                                                  1,229           105            57  1,391 
                                              ---------  ------------  ------------  ----- 
  Liabilities 
  Contingent consideration 
   payable                                            -             -          (10)   (10) 
  Derivative designated at 
   fair value 
 
    *    through other comprehensive income           -          (55)             -   (55) 
 
    *    through profit and loss                      -           (4)             -    (4) 
 
                                                      -          (59)          (10)   (69) 
                                              ---------  ------------  ------------  ----- 
 
  31st December 2016 
  Assets 
  Available-for-sale financial 
   assets 
                                              ---------  ------------  ------------  ----- 
 
  - listed securities                             1,327             -             -  1,327 
  - unlisted investments                              -            44            56    100 
 
 
                                                  1,327            44            56  1,427 
  Derivative designated at 
   fair value 
  - through other comprehensive 
   income                                             -           102             -    102 
 
    *    through profit and loss                      -            17             -     17 
 
                                                  1,327           163            56  1,546 
                                              ---------  ------------  ------------  ----- 
  Liabilities 
  Contingent consideration 
   payable                                            -             -          (10)   (10) 
  Derivative designated at 
   fair value 
 
    *    through other comprehensive income           -          (21)             -   (21) 
 
    *    through profit and loss                      -           (8)             -    (8) 
 
                                                      -          (29)          (10)   (39) 
                                              ---------  ------------  ------------  ----- 
 

There were no transfers among the three categories during the six months ended 30th June 2017 and the year ended 31st December 2016.

Movement of financial instruments which are valued based on unobservable inputs during the six months ended 30th June 2017 and year ended 31st December 2016 are as follows:

 
                                              Available-for-sale      Contingent 
                                                       financial   consideration 
                                                          assets         payable 
                                                            US$m            US$m 
 
 
  At 1st January 2017                                         56            (10) 
  Exchange differences                                         1               - 
 
  At 30th June 2017                                           57            (10) 
                                              ------------------  -------------- 
 
  At 1st January 2016                                         55            (27) 
  Exchange differences                                       (1)               - 
  Additions                                                    1             (1) 
  Net change in fair value during the 
   year 
  - included in other comprehensive income                     1               - 
 
    *    included in profit and loss                           -              15 
  Adjustment of contingent consideration                       -               3 
                                              ------------------  -------------- 
 
  At 31st December 2016                                       56            (10) 
                                              ------------------  -------------- 
 

The contingent consideration payable mainly arose from Astra's acquisition of a 60% interest in PT Duta Nurcahya in 2012 and represents the fair value of service fee payable for mining services to be provided by the vendor.

(ii) Financial instruments that are not measured at fair value

The fair values of current debtors, bank balances and other liquid funds, current creditors and current borrowings are assumed to approximate their carrying amounts due to the short-term maturities of these assets and liabilities.

The fair values of long-term borrowings are based on market prices or are estimated using the expected future payments discounted at market interest rates.

10. Notes to Consolidated Cash Flow Statement

   (a)   Purchase of subsidiaries 
 
                                   Six months ended 30th June 
 
                                                 2017    2016 
                                                 Fair    Fair 
                                                value   value 
                                                 US$m    US$m 
 
 
  Intangible assets                               307       - 
  Tangible assets                                 154      25 
  Associates and joint ventures                    70       - 
  Deferred tax assets                              12       - 
  Current assets                                   14      10 
  Deferred tax liabilities                       (86)       - 
  Current liabilities                           (129)     (1) 
  Long-term borrowings                           (35)       - 
  Other non-current liabilities                   (1)       - 
 
  Fair value of identifiable net assets 
   acquired                                       306      34 
  Adjustment for non-controlling interests        (7)       - 
  Goodwill                                         11      14 
                                               ------  ------ 
 
  Total consideration                             310      48 
  Adjustment for deposit paid in previous 
   year                                          (12)       - 
  Adjustment for deferred consideration          (79)       - 
  Carrying value of an associate                (194)       - 
  Payment for contingent consideration              -       1 
  Cash and cash equivalents of subsidiaries 
   acquired                                       (1)       - 
                                               ------  ------ 
 
  Net cash outflow                                 24      49 
                                               ------  ------ 
 

For the subsidiaries acquired during 2017, the fair values of identifiable assets and liabilities at the acquisition dates are provisional and will be finalized within one year after the acquisition dates.

Net cash outflow for purchase of subsidiaries for the six months ended 30th June 2017 included US$13 million for Jardine Motors' acquisition of a motor dealership in the United Kingdom, and an additional consideration of US$9 million for Astra's acquisition of an 80% interest in PT Suprabari Mapanindo Mineral, a coal mining company, upon completion in March 2017.

Revenue and loss after tax since acquisition in respect of subsidiaries acquired during the six months ended 30th June 2017 amounted to US$27 million and US$5 million, respectively. Had the acquisitions occurred on 1st January 2017, consolidated revenue and consolidated profit after tax for the six months ended 30th June 2017 would have been US$19,466 million and US$4,594 million, respectively.

Net cash outflow for the six months ended 30th June 2016 comprised Jardine Motors' acquisition of various motor dealerships in the United Kingdom during the second quarter of 2016.

Goodwill in both periods mainly arose from the acquisition of motor dealerships which were attributable to the expected synergies with its existing retail network. None of the goodwill is expected to be deductible for tax purposes.

(b) Purchase of associates and joint ventures for the six months ended 30th June 2017 included Jardine Cycle & Carriage's subscription to rights issue and purchase of additional shares in Siam City Cement Public Company Limited in Thailand of US$138 million, increasing its interest from 24.9% to 25.5%; Astra's investments in toll road operators of US$264 million and a power plant operator of US$206 million in Indonesia, and subscription to PT Bank Permata's rights issue of US$44 million; and Jardine Strategic's acquisition of a 28% interest in Greatview Aseptic Packaging Company Limited, an aseptic carton packaging supplier, of US$246 million and additional investment in Zhongsheng of US$172 million, increasing its interest from 15.5% to 20.0%.

Purchase the six months ended 30th June 2016 included US$183 million for Astra's subscription to PT Bank Permata's rights issue and US$22 million for Astra's capital injections into certain associates and joint ventures in Indonesia.

(c) Purchase of other investments for the six months ended 30th June 2017 and 2016 mainly included acquisition of securities by Astra.

(d) Advance to associates and joint ventures for the six months ended 30th June 2017 and 2016 mainly included Hongkong Land's advance to its property joint ventures.

(e) Advance and repayment from associates and joint ventures for the six months ended 30th June 2017 and 2016 mainly included advance and repayment from Hongkong Land's property joint ventures.

(f) Sale of other investments for the six months ended 30th June 2017 and 2016 comprised Astra's sale of securities.

   (g)   Change in interests in subsidiaries 
 
                          Six months ended 30th June 
 
                                         2017   2016 
                                         US$m   US$m 
 
 
  Increase in attributable interests 
  - Jardine Strategic                       -  (120) 
  - Mandarin Oriental                       -   (67) 
  - Jardine Cycle & Carriage                -   (23) 
  - other                                (24)      - 
  Decrease in attributable interests       15      - 
 
                                          (9)  (210) 
                                        -----  ----- 
 

Increase in attributable interests in other subsidiaries for the six months ended 30th June 2017 comprised Jardine Motors' acquisition of an additional 40% interest in a motor dealership in mainland China, increasing its controlling interest to 100%.

Decrease in attributable interests for the six months ended 30th June 2017 comprised balance of proceeds for Hongkong Land's sale of a 6% interest in Wangfu Central Real Estate Development Company Limited in 2016, reducing its controlling interest to 84%.

11. Capital Commitments and Contingent Liabilities

Total capital commitments at 30th June 2017 and 31st December 2016 amounted to US$2,254 million and US$2,118 million, respectively.

Various Group companies are involved in litigation arising in the ordinary course of their respective businesses. Having reviewed outstanding claims and taking into account legal advice received, the Directors are of the opinion that adequate provisions have been made in the condensed financial statements.

12. Related Party Transactions

In the normal course of business the Group undertakes a variety of transactions with certain of its associates and joint ventures.

The most significant of such transactions relate to the purchases of motor vehicles and spare parts from the Group's associates and joint ventures in Indonesia including PT Toyota-Astra Motor, PT Astra Honda Motor and PT Astra Daihatsu Motor. Total cost of motor vehicles and spare parts purchased for the six months ended 30th June 2017 amounted to US$2,547 million (2016: US$2,474 million). The Group also sells motor vehicles and spare parts to its associates and joint ventures in Indonesia including PT Astra Honda Motor, PT Astra Daihatsu Motor and PT Tunas Ridean. Total revenue from sales of motor vehicles and spare parts for the six months ended 30th June 2017 amounted to US$289 million (2016: US$288 million).

PT Bank Permata provides banking services to the Group. The Group's deposits with PT Bank Permata at 30th June 2017 amounted to US$352 million (2016: US$480 million).

There were no other related party transactions that might be considered to have a material effect on the financial position or performance of the Group that were entered into or changed during the first six months of the current financial year.

Amounts of outstanding balances with associates and joint ventures are included in debtors and creditors, as appropriate.

Jardine Matheson Holdings Limited

Principal Risks and Uncertainties

The Board has overall responsibility for risk management and internal control. The following have been identified previously as the areas of principal risk and uncertainty facing the Company, and they remain relevant in the second half of the year.

   --     Economic Risk 
   --     Commercial Risk and Financial Risk 
   --     Concessions, Franchises and Key Contracts 
   --     Regulatory and Political Risk 
   --     Terrorism, Pandemic and Natural Disasters 

For greater detail, please refer to page 122 of the Company's Annual Report for 2016, a copy of which is available on the Company's website www.jardines.com.

Responsibility Statement

The Directors of the Company confirm to the best of their knowledge that:

   (a)   the condensed financial statements have been prepared in accordance with IAS 34; and 

(b) the interim management report includes a fair review of all information required to be disclosed by the Disclosure Guidance and Transparency Rules 4.2.7 and 4.2.8 issued by the Financial Conduct Authority of the United Kingdom.

For and on behalf of the Board

Ben Keswick

John Witt

Directors

 
 
  The interim dividend of USc40.00 per share will be payable 
   on 19th October 2017 to shareholders on the register of members 
   at the close of business on 25th August 2017. The shares will 
   be quoted ex-dividend on the Singapore Exchange and the London 
   Stock Exchange on 23rd and 24th August 2017, respectively. 
   The share registers will be closed from 28th August to 1st 
   September 2017, inclusive. The dividend will be available 
   in cash with a scrip alternative. 
 
   Shareholders will receive their cash dividends in United States 
   dollars, unless they are registered on the Jersey branch register 
   where they will have the option to elect for sterling. These 
   shareholders may make new currency elections for the 2017 
   interim dividend by notifying the United Kingdom transfer 
   agent in writing by 29th September 2017. The sterling equivalent 
   of dividends declared in United States dollars will be calculated 
   by reference to a rate prevailing on 4th October 2017. 
 
   Shareholders holding their shares through CREST in the United 
   Kingdom will receive their cash dividends in sterling only 
   as calculated above. Shareholders holding their shares through 
   The Central Depository (Pte) Limited ('CDP') in Singapore 
   will receive their cash dividends in United States dollars 
   unless they elect, through CDP, to receive Singapore dollars. 
 
   Shareholders on the Singapore branch register who wish to 
   deposit their shares into the CDP system by the dividend record 
   date, being 25th August 2017, must submit the relevant documents 
   to M & C Services Private Limited, the Singapore branch registrar, 
   no later than 5.00 p.m. (local time) on 24th August 2017. 
 
 

The Jardine Matheson Group

Jardine Matheson is a diversified Asian-based group with unsurpassed experience in the region, having been founded in China in 1832. It has a broad portfolio of market-leading businesses, which represent a combination of cash generating activities and long-term property assets and are closely aligned to the increasingly prosperous consumers of the region. The Group's businesses aim to produce sustainable returns by providing their customers with high quality products and services.

Jardine Matheson operates principally in Greater China and Southeast Asia, where its subsidiaries and affiliates benefit from the support of the Group's extensive knowledge of the region and its long-standing relationships. These companies are active in the fields of motor vehicles and related operations, property investment and development, food retailing, home furnishings, engineering and construction, transport services, insurance broking, restaurants, luxury hotels, financial services, heavy equipment, mining and agribusiness.

Jardine Matheson holds interests directly in Jardine Pacific (100%), Jardine Motors (100%) and Jardine Lloyd Thompson (42%), while its 84% held Group holding company, Jardine Strategic, is interested in Hongkong Land (50%), Dairy Farm (78%), Mandarin Oriental (77%) and Jardine Cycle & Carriage (75%), which in turn has a 50% shareholding in Astra. Jardine Strategic also has a 57% shareholding in Jardine Matheson.

Jardine Matheson Holdings Limited is incorporated in Bermuda and has a standard listing on the London Stock Exchange, with secondary listings in Bermuda and Singapore. Jardine Matheson Limited operates from Hong Kong and provides management services to Group companies.

- end -

For further information, please contact:

 
Jardine Matheson Limited 
John Witt                  (852) 2843 8278 
 
Brunswick Group Limited 
Karin Wong                 (852) 3512 5077 
 

As permitted by the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority in the United Kingdom, the Company will not be posting a printed version of the Half-Yearly Results announcement to shareholders. The Half-Yearly Results announcement will remain available on the Company's website, www.jardines.com, together with other Group announcements.

This information is provided by RNS

The company news service from the London Stock Exchange

END

IR EAKPDEFXXEEF

(END) Dow Jones Newswires

August 04, 2017 05:22 ET (09:22 GMT)

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