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| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| China Travel International Investment Hong Kong Ltd | TG:CTI | Tradegate | Ordinary Share |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.001 | 0.83% | 0.121 | 0.115 | 0.126 | 0.00 | 22:50:08 |
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RNS Number:2290Q
Cathay International Holdings Ld
26 September 2003
26th September, 2003
CATHAY INTERNATIONAL HOLDINGS LIMITED
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2003
CHAIRMAN'S INTERIM STATEMENT
The first half of 2003 saw a significant change in the composition of the
Group's assets, the return of approximately USD24 million of surplus cash to
shareholders, difficult trading conditions as a result of the SARS virus and new
investments being made in line with the Group's strategy.
In the first quarter of 2003 shareholders approved the disposal of the Stonehill
Business Park ("Stonehill") for a cash consideration of USD30,869,000 and the
termination of the joint venture relating to the Xiyuan Hotel and development
site in Beijing ("Xiyuan"), resulting in a cash entitlement for the Group of
USD50,900,000, net of taxes, including USD18,747,000 of undistributed profits.
Each of these transactions resulted in a gain which has been reflected in the
unaudited accounts for the six months to 30 June 2003.
Following receipt of the cash proceeds from these transactions your Board
concluded that approximately USD24 million would be surplus to the Group's short
term requirements and that a tender offer was the most appropriate means of
returning such surplus to shareholders. In February 2003 shareholders approved
the proposed tender offer and the Company purchased 99,999,780 common shares at
a fixed price of 15 pence per share, representing a 93.5% premium to the closing
share price on the day prior to the announcement of the tender offer.
In March 2003, the unexpected outbreak of the Severe Acute Respiratory Syndrome
("SARS") virus began seriously to affect the operations of the Landmark Hotel in
Shenzhen, the People's Republic of China ("China"). From March to June 2003,
the Landmark Hotel, in common with other leading hotels in Shenzhen, experienced
unprecedented low levels of occupancy. From an average occupancy rate of 62% in
the first three months of 2003, the occupancy rate dropped to an average of 19%
in April. The average occupancy rate for the first six months of 2003 was
approximately 41% compared to 61% for the same period last year. Turnover at
food and beverage outlets at the Hotel was also adversely affected. Since June
2003, when the World Health Organisation removed Shenzhen from the affected
areas list, there has been a slow, but steady, recovery of the hotel business.
We expect the Landmark Hotel to return to normal levels of activity during the
last quarter of 2003.
The results for the six months to 30 June 2003 have therefore been significantly
affected by the SARS outbreak. They also reflect the disposals of Stonehill and
Xiyuan and the return of surplus cash to shareholders. Turnover for the six
months to 30 June 2003 was USD5,510,000 compared with USD15,806,000 for the six
months ended 30 June 2002. The operating profit for the period was USD404,000
(2002: profit of USD2,214,000) and the pre-tax loss before minority interests
was USD346,000 (2002: profit of USD1,002,000). The profit after tax and
minority interests was USD9,810,000 (2002: loss of USD104,000). This profit
figure mainly results from the accounting treatment of deferred taxation
expenses required under International Accounting Standards ("IAS"). The balance
of cash at bank and in hand as at 30 June 2003 was USD24,801,000 (2002:
USD40,069,000).
Under EU Regulations publicly traded companies must prepare, by 2005 at the
latest, consolidated accounts under IAS. The Group has adopted the
International Financial Reporting Standards ("IFRS") as the basis for preparing
its financial statements this year. The effects of the adoption of IFRS on the
amounts reported in the financial statements of previous periods are shown in
the notes to the interim financial statements.
In accordance with its usual practice, the Group will conduct an annual
valuation of its property at the year end. Any adjustments in asset value will,
if necessary, be reported at that time.
In line with the Group's core strategy your Board has been seeking new business
and investment opportunities in China which are expected to provide high growth
rates and generate improved shareholder returns. Your Board has identified the
biotechnology and pharmaceutical market in China as having high growth
potential. In June 2003 the Group announced a joint venture with a group of
Chinese medical, science and management professionals with expertise in the
biotechnology and pharmaceutical industry. The Group's strategy is to build a
portfolio of biotechnology and pharmaceutical projects with the aim of providing
a steady stream of products to be manufactured and marketed in China. The Group
has invested USD2,650,000 for a 74.58% interest in Cathay International
Changchun Biotechnology and Pharmaceutical Limited ("Changchun Biotechnology")
with the minority interest being held by the professionals mentioned above, who
have contributed the rights they own to certain technologies and specialist
expertise. Changchun Biotechnology's first project is the acquisition of a
95.2% interest in Changchun Botai Medicine and Biological Technology Company
Limited ("Botai"). Botai is a sino-foreign joint venture company based in
Changchun, the capital city of Jilin Province in the North East of China. The
other shareholder of Botai is Tongtuo High-tech Development Center of Jilin
University. Jilin University is one of China's leading scientific research
universities and, in particular, a major research institution for biotechnology,
pharmaceutical and medical science. The Tongtuo High-tech Development Center
will contribute technology to Botai and provide scientific and research
equipment and professionals. In early August, the Group announced a second
investment, a USD550,000 investment for a 70% interest in Tianjin Longbai
Biological Engineering and Technology Company Limited ("Longbai"), an equity
joint venture in Tianjin City in the North of China. Longbai researches and
develops technology for new drug delivery formats, focusing on oral fast release
drugs. The Group expects to make further investments in the biotechnology and
pharmaceutical industry in China and will make announcements at the appropriate
time.
Your Board continues to believe that there are attractive opportunities for
investment in China and we are actively seeking additional business
opportunities in China to provide new sources of earnings and capital growth.
On behalf of the Board, I would like to thank our staff for their continued
dedication and commitment.
James Buchanan
Chairman
Enquiries:
Stephen Hunt (Deputy Chairman) (via Brunswick) 020 7404 5959
Patrick Sung (Director - Finance)
Jon Coles, Brunswick 020 7404 5959
GROUP CONDENSED PROFIT AND LOSS ACCOUNT
(Restated) (Restated)
Six months Six months Year ended
ended 30 June ended 30 June 31 December
2003 2002 2002
(Unaudited) (Unaudited) (Audited)
Notes USD'000 USD'000 USD'000
TURNOVER 3 5,510 15,806 32,586
COST OF SALES (5,590) (12,560) (25,491)
_____________ ____________ ____________
GROSS PROFIT (LOSS) (80) 3,246 7,095
ADMINISTRATIVE EXPENSES
Administrative expenses (1,355) (1,032) (3,479)
Deficit on revaluation of fixed assets - - (163,566)
Recognition of negative goodwill as
Income - - 98,140
Profit on disposal of subsidiary 1,860 - -
Profit on disposal of fixed assets 76 - 274
Tender offer expenses (97) - -
484 (1,032) (68,631)
_____________ ____________ ____________
PROFIT/(LOSS) FROM OPERATIONS 404 2,214 (61,536)
FINANCE COSTS - NET (750) (1,212) (2,512)
_____________ ____________ ____________
(LOSS)/PROFIT BEFORE TAXATION 3 (346) 1,002 (64,048)
TAXATION 4 10,129 (450) 57,807
_____________ ____________ ____________
PROFIT/(LOSS) ON ORDINARY
ACTIVITIES AFTER TAXATION 9,783 552 (6,241)
MINORITY INTEREST 27 (656) 40,510
_____________ ____________ ____________
ACCUMULATED PROFIT/(LOSS )
ATTRIBUTABLE TO
EQUITY SHAREHOLDERS 9,810 (104) 34,269
=========== ========== ==========
PROFIT/(LOSS) PER SHARE
BASIC 6 4.58 cents (0.04) cents 12.20 cents
=========== ========== ==========
GROUP CONDENSED BALANCE SHEET
(Restated) (Restated)
As at As at As at
30 June 30 June 31 December
2003 2002 2002
(Unaudited) (Unaudited) (Audited)
Note USD'000 USD'000 USD'000
ASSETS
NON-CURRENT ASSETS
Property, plant and equipment 102,799 369,547 197,464
Intangible assets 1,101 (102,544) (4,404)
_____________ ____________ ____________
103,900 267,003 193,060
_____________ ____________ ____________
CURRENT ASSETS
Inventory 377 1,104 1,116
Trade debtors and other receivables 594 2,073 1,882
Cash and cash equivalents 24,801 40,069 43,320
_____________ ____________ ____________
25,772 43,246 46,318
_____________ ____________ ____________
TOTAL ASSETS 129,672 310,249 239,378
=========== ========== ==========
EQUITY AND LIABILITIES
CAPITAL AND RESERVES 7 78,766 78,250 108,042
MINORITY INTERESTS 1,077 79,095 37,985
NON-CURRENT LIABILITIES
Borrowings 23,961 32,543 23,286
Deferred tax liabilities 8 13,849 90,840 30,731
_____________ ____________ ____________
37,810 123,383 54,017
_____________ ____________ ____________
CURRENT LIABILITIES
Borrowings 5,250 3,453 12,739
Trade creditors and other payables 6,769 26,068 26,595
_____________ ____________ ____________
12,019 29,521 39,334
_____________ ____________ ____________
TOTAL EQUITY AND LIABILITIES 129,672 310,249 239,378
========== ========= ==========
GROUP CONDENSED STATEMENT OF CHANGES IN EQUITY
Capital and Exchange Profit
Share Revaluation Special Statutory Equalisation and Loss
Capital Reserve Reserve Reserve Reserve Account Total
USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
Balance at January 1, 2002 14,042 61,055 61,639 2,463 1,029 (62,859) 77,369
Exchange adjustment - (529) 146 (42) 1,410 - 985
Loss for the period - - - - - (104) (104)
_______ _________ ________ _______ _________ _______ _______
Balance at June 30, 2002 14,042 60,526 61,785 2421 2,439 (62,963) 78,250
====== ======== ======= ====== ======== ====== ======
Balance at January 1, 2003 14,042 53,834 61,639 2,550 4,687 (28,710) 108,042
Exchange adjustment - (388) - (7) 1,124 167 896
Realised exchange reserve on
disposal of subsidiary - - - - (16,266) - (16,266)
Purchase of shares (5,000) - (18,716) - - - (23,716)
Profit for the period - - - - - 9,810 9,810
Transfer on disposal of
subsidiary and fixed assets - (3,613) - (1,463) - 5,076 -
_______ _________ ________ _______ _________ _______ _______
Balance at June 30, 2003 9,042 49,833 42,923 1,080 (10,455) (13,657) 78,766
====== ======== ======= ====== ======== ====== ======
GROUP CONDENSED CASH FLOW STATEMENT
(Restated) (Restated)
Six months Six months Year ended
ended 30 June ended 30 June 31 December
2003 2002 2002
(Unaudited) (Unaudited) (Audited)
USD'000 USD'000 USD'000
Cash flows from operating activities (2,600) (281) 1,774
Cash flows from investing activities 31,542 (1,096) (578)
Cash flows from financing activities (45,438) 475 (763)
Effects of exchange rate changes 271 907 1,379
____________ ___________ ____________
Net increase (decrease) in cash and cash equivalents (16,225) 5 1,812
Cash and cash equivalents at beginning of the period 41,026 39,214 39,214
____________ ___________ ____________
Cash and cash equivalents at end of the period 24,801 39,219 41,026
========== ========= ==========
NOTES
1 BASIS OF PREPARATION
In 2003, the Group adopted the IFRS as the basis for preparing its financial
statements. The comparative financial statements have been restated to comply
with the IFRS. The adoption of the IFRS has resulted in the recognition of
deferred tax provisions as set out in note 10.
The interim condensed financial statements have been prepared in accordance with
International Accounting Standard No. 34 Interim Financial Reporting and under
the historical cost convention, modified where appropriate to incorporate a
professional valuation of certain fixed assets.
The preparation of financial statements in conformity with generally accepted
accounting principles requires the use of estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of financial statements and the reported
amounts of revenues and expenses during the reporting period. Although these
estimates are based on management's best knowledge of current events and
actions, actual results may differ from those estimates.
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies adopted are set out below.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of
the Company and enterprises controlled by the Company (its subsidiaries) made up
to 31 December each year. Control is achieved where the Company has the power to
govern the financial and operating policies of an investee enterprise so as to
obtain benefits from its activities. On acquisition, the assets and liabilities
of a subsidiary are measured at their fair values at the date of acquisition.
Any excess (deficiency) of the cost of acquisition over (below) the fair values
of the identifiable net assets acquired is recognised as goodwill (negative
goodwill). The interest of minority shareholders is stated at the minority's
proportion of the fair values of the assets and liabilities recognised.
The results of subsidiaries acquired or disposed of during the year are included
in the consolidated income statement from the effective date of acquisition or
up to the effective date of disposal, as appropriate. Where necessary,
adjustments are made to the financial statements of subsidiaries to bring the
accounting policies used into line with those used by other members of the
Group.
All significant intercompany transactions and balances between group enterprises
are eliminated on consolidation.
Goodwill
Goodwill arising on consolidation represents the excess of the cost of
acquisition over the Group's interest in the fair value of the identifiable
assets and liabilities of a subsidiary, associate or jointly controlled entity
at the date of acquisition. Goodwill is recognised as an asset and amortised on
a straight-line basis over its estimated useful life. Goodwill arising on the
acquisition of subsidiaries is presented separately in the balance sheet.
On disposal of a subsidiary, associate or jointly controlled entity, the
attributable amount of unamortised goodwill is included in the determination of
the profit or loss on disposal.
Negative goodwill
Negative goodwill represents the excess of the Group's interest in the fair
value of the identifiable assets and liabilities of a subsidiary at the date of
acquisition over the cost of acquisition. Negative goodwill is released to
income based on an analysis of the circumstances from which the balance
resulted. To the extent that the negative goodwill is attributable to losses or
expenses anticipated at the date of acquisition, it is released to income in the
period in which those losses or expenses arise. The remaining negative goodwill
is recognised as income when the future economic benefits embodied in the
identifiable underlying assets acquired are consumed.
Negative goodwill arising on the acquisition of subsidiaries is presented
separately in the balance sheet as a deduction from assets.
On disposal of a subsidiary, the attributable amount of unamortised negative
goodwill is included in the determination of the profit or loss on disposal.
Foreign currencies
Transactions in currencies other than United States Dollar are initially
recorded at the rates of exchange prevailing on the dates of the transactions.
Monetary assets and liabilities denominated in such currencies are retranslated
at the rates prevailing on the balance sheet date. Profits and losses arising on
exchange are included in net profit or loss for the period.
On consolidation, the assets and liabilities of the Group's overseas operations
are translated at exchange rates prevailing on the balance sheet date. Income
and expense items are translated at the average exchange rates for the period.
Exchange differences arising, if any, are classified as equity and transferred
to the Group's translation reserve. Such translation differences are recognised
as income or as expenses in the period in which the operation is disposed of.
Goodwill and fair value adjustments arising on the acquisition of a foreign
entity are treated as assets and liabilities of the parent company and
translated at the exchange rate at the date of transaction.
Taxation
Income tax expense represents the sum of the tax currently payable and deferred
tax.
The tax currently payable is based on taxable profit for the year. Taxable
profit differs from net profit as reported in the income statement because it
excludes items of income or expense that are taxable or deductible in other
years and it further excludes items that are never taxable or deductible. The
Group's liability for current tax is calculated using tax rates that have been
enacted or substantively enacted by the balance sheet date.
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amount of assets and liabilities in the financial
statements and the corresponding tax basis used in the computation of taxable
profit, and is accounted for using the balance sheet liability method. Deferred
tax liabilities are generally recognised for all taxable temporary differences
and deferred tax assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible temporary differences
can be utilised. Such assets and liabilities are not recognised if the temporary
difference arises from goodwill (or negative goodwill) or from the initial
recognition (other than in a business combination) of other assets and
liabilities in a transaction that affects neither the tax profit nor the
accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences
arising on investments in subsidiaries and associates, and interests in joint
ventures, except where the Group is able to control the reversal of the
temporary difference and it is probable that the temporary difference will not
reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each balance sheet
date and reduced to the extent that it is no longer probable that sufficient
taxable profit will be available to allow all or part of the asset to be
recovered.
Deferred tax is calculated at the tax rates enacted at the balance sheet dates
and that are expected to apply in the period when the liability is settled or
the asset realised. Deferred tax is charged or credited in the income statement,
except when it relates to items charged or credited directly to equity, in which
case the deferred tax is also dealt with in equity.
Deferred tax assets and liabilities are offset when they relate to income taxes
levied by the same taxation authority and the Group intends to settle its
current tax assets and liabilities on a net basis.
Hotel properties
Hotel properties are stated at open market value based on annual professional
valuations. Hotel valuations are inclusive of all fixtures and equipment, and
thus the revaluation surplus/deficit on hotel properties is shown after
deducting the net book value of separable and non-integrated fixtures and
equipment. Changes in the value of hotel properties are dealt with as movements
in the revaluation reserve. If the balance of this reserve is insufficient to
cover a deficit, on an individual hotel basis, the excess of the deficit is
charged to the profit and loss account.
It is the Group's practice to maintain hotel properties and integral fixed plant
in a continual state of sound repair, such that their value is not diminished by
the passage of time. Accordingly, the Directors consider that the useful
economic lives of these assets are sufficiently long and their residual values,
based on prices prevailing at the time of valuation, are sufficiently high that
their depreciation is insignificant. The cost of maintenance and repairs of the
properties is charged to the consolidation profit and loss account as incurred
and the cost of significant improvements is capitalised.
Properties held for development
Properties held for development were stated at existing use value based on
professional valuation. Valuations are inclusive of all fixtures and equipment
and thus the revaluation surplus/deficit on such properties is shown after
deducting the net book value of separable and non-integrated fixtures and
equipment.
Interest incurred on borrowings to finance the development of these properties
is capitalised and included in the carrying value thereof.
Investment properties
Investment properties are interests in land and buildings for which construction
work and development have been completed and which are intended to be held on a
long term basis. Such properties are stated at their fair values based on
valuations by the Directors.
Gains or losses arising from the disposal of investment property are determined
as the difference between the net disposal proceeds and the carrying amount of
the asset and are recognised as income or expense in the income statement.
Properties let to group companies
Properties let to group companies are interests in properties which are let to
subsidiaries of the ultimate parent company. These properties are intended to be
held on a long term basis.
Other tangible fixed assets
Other tangible fixed assets are stated at cost less accumulated depreciation.
Depreciation is provided to write off the cost of fixed assets on a systematic
basis over their estimated useful lives. The major categories of fixed assets
are depreciated as follows:
Plant and equipment, fixtures and fittings 3-15 years
Motor vehicles 5-12 years
Computer equipment 5 years
Leasehold properties and improvements Residual lease term
Inventory
Inventory comprises goods purchased for re-sale and consumable stores and are
valued at the lower of cost and estimated net realisable value.
Cash and cash equivalents
Cash and cash equivalents are carried in the balances sheet at cost. For the
purposes of the cash flow statement, cash and cash equivalents comprise cash on
hand, deposits held at call with banks, other short-term highly liquid
investments with original maturities of three months or less, and bank
overdrafts. Bank overdrafts are included within borrowings in current
liabilities on the balance sheet.
3 Segmental Information
(Restated) (Restated)
Six months Six months Year ended
ended 30 June ended 30 June 31 December
2003 2002 2002
(Unaudited) (Unaudited) (Audited)
USD'000 USD'000 USD'000
Classes of Business
Turnover
Hotel Operations 5,421 14,370 29,806
Property investment 89 1,436 2,780
___________ ____________ ___________
5,510 15,806 32,586
(Loss)/Profit before taxation
Hotel Operations 662 1,745 (2,912)
Property Investment 165 149 900
Property Development - - (60,274)
Pharmaceutical (56) - -
Corporate Office (1117) (892) (1,762)
___________ ____________ ___________
346 1,002 (64,048)
Geographical segments
Turnover
United Kingdom - 1,248 2,404
PRC 5,510 14,558 30,182
___________ ____________ ___________
5,510 15,806 32,586
(Loss)/Profit before taxation
United Kingdom 76 (9) 311
PRC 695 1,903 (62,597)
Hong Kong (1,117) (892) (1,762)
___________ ____________ ___________
(346) 1,002 (64,048)
========== =========== ==========
4 TAXATION
(Restated) (Restated)
Six months Six months Year ended
ended 30 June ended 30 June 31 December
2003 2002 2002
(Unaudited) (Unaudited) (Audited)
USD'000 USD'000 USD'000
Current tax - (450) (993)
Deferred tax (note 8) 10,129 - 58,800
____________ ___________ ____________
10,129 (450) 57,807
========== ========== ==========
No provision for current tax has been made as there was no assessable profit
during the period.
5 DIVIDENDS
No ordinary dividend is proposed (2002: Nil).
6 PROFIT PER SHARE
Profit per share is based upon the profit after tax attributable to shareholders
of USD9,810,000 for the six months ended 30 June 2003 (six months ended 30 June
2002: loss of USD104,000) and the weighted average number of A shares and common
shares in issue during the period of 12,566,102 and 201,609,483 respectively (30
June 2002 - A shares: 14,042,105, common shares: 266,800,000).
7 SHARE CAPITAL
Pursuant to the tender offer approved in February 2003, the Company purchased
99,999,780 common shares at a fixed price of 15 pence per share. The total
consideration paid was USD 23,716,000 and has been deducted from shareholders'
equity. The purchased shares have been cancelled.
8 DEFERRED TAXATION
(Restated) (Restated)
As at As at As at
30 June 2003 30 June 2002 31 December 2002
(Unaudited) (Unaudited) (Audited)
USD'000 USD'000 USD'000
Deferred tax liabilities on revaluation of 15,081 92,213 31,963
properties
Deferred tax assets on tax losses (1,232) (1,473) (1,232)
____________ ___________ ____________
Net position 13,849 90,840 30,731
========== ========== ==========
The movement for the period in the net deferred tax position was as follows:
(Restated) (Restated)
As at As at As at
30 June 2003 30 June 2002 31 December 2002
(Unaudited) (Unaudited) (Audited)
USD'000 USD'000 USD'000
At 1 January 30,731 90,840 90,840
Charge to income - - (58,800)
Charge to equity - - (1,309)
Net liability disposed of on disposal of (16,882) - -
subsidiary
____________ ___________ ____________
13,849 90,840 30,731
========== ========== ==========
9 ACQUISITION AND DISPOSAL OF SUBSIDIARIES
Disposal of subsidiary
On 24 February 2003, the Company's shareholders approved the termination of the
joint venture relating to Xiyuan Hotel and development site in Beijing and a
distribution of assets by the joint venture company, Beijing Xiyuan Landmark
Limited ("Beijing Xiyuan"). The distribution was completed on 24 February 2003.
The results of Beijing Xiyuan for the period from 1 January 2003 to 24 February
2003, which have been included in the Group's results for the period, were as
follows:
(Restated)
1 January 2003 to Six months ended
24 February 2003 30 June 2002
(Unaudited) (Unaudited)
USD'000 USD'000
Turnover 2,507 9,750
Operating costs (2,544) (7,924)
Interest - 265
____________ ____________
(Loss)/Profit before taxation (37) 2,091
Taxation - (450)
____________ ____________
(Loss)/Profit after taxation (37) 1,641
Minority interests 15 (656)
____________ ____________
(Loss)/Profit for the period (22) 985
========== ==========
The net assets of Beijing Xiyuan at the date of disposal were as follows:
24 February 2003
(Unaudited)
USD'000
Net assets disposed of 64,977
Reclassification from shareholders' equity
- exchange equalisation reserve (16,266)
Transaction expenses 329
____________
49,040
Profit on disposal 1,860
____________
Total consideration 50,900
==========
The net cash inflow on disposal is determined as follows:
Proceeds from disposal 50,900
Repayment of sums owing to Beijing Xiyuan (6,800)
Transaction expenses (329)
Cash and cash equivalents in subsidiary disposal of (41,808)
____________
Net cash inflow on disposal 1,963
==========
Beijing Xiyuan did not make any significant contribution to the cash flows of
the Group during the interim period.
Acquisitions
In 2003, the Group acquired for a cash consideration of USD 2,650,000 a 74.58%
interest in Cathay International Changchun Biotechnology and Pharmaceutical
Limited, which in turn acquired a controlling interest in Changchun Botai
Medicine and Biological Technology Company Limited.
10 RECONCILIATION OF EFFECTS OF ADOPTION OF IFRS
Reconciliation of net assets
As at As at
30 June 2002 31 December 2002
(Unaudited) (Audited)
USD'000 USD'000
Net assets under UK accounting standards 138,817 132,020
Recognition of deferred taxation (90,840) (30,731)
Minority interest share of deferred taxation 30,273 6,753
____________ ____________
Net assets under IFRS 78,250 108,042
========== ==========
Reconciliation of net profit/(loss)
As at As at
30 June 2002 31 December 2002
(Unaudited) (Audited)
USD'000 USD'000
Net loss under UK accounting standards (104) (1,011)
Recognition of deferred taxation - 58,800
Minority interest share of deferred taxation - (23,520)
____________ ____________
Net profit/(loss) under IFRS (104) 34,269
========== ==========
11 PUBLICATION OF NON-STATUTORY ACCOUNTS
The unaudited interim results do not constitute full accounts prepared in
accordance with the listing rules of the UK Financial Services Authority. The
figures for the year ended 31 December 2002 have been based on the full accounts
of the Company which were prepared under UK GAAP and which included an
unqualified audit report. The adjustments in respect of the adoption of IFRS
have not been audited. The interim financial information in this report has been
neither audited nor reviewed by the Company's auditors.
12 Copies of this report have been sent to shareholders and are available to the
public from the Company's UK Transfer Agents, Capita IRG plc, The Registry, 34
Beckenham Road, Beckenham, Kent BR3 4TU.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR NKAKKBBKDOCB
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