Brierley Investments - Interim Results

RNS No 9311m
BRIERLEY INVESTMENTS LIMITED
5th March 1998



                      HALF YEARLY REPORT
           FOR THE SIX MONTHS ENDED 31 DECEMBER 1997

                         31 December 1997     31 December 1996
                                          $thousands
OPERATING REVENUE               1,418,596            1,322,748
                                =========            =========
NET OPERATING SURPLUS                                         
  BEFORE TAXATION*                100,889              124,527
Taxation                         (17,495)             (11,927)
                                ---------            ---------
SURPLUS AFTER TAXATION             83,394              112,600
Minority Interests               (24,278)             (30,319)
Equity Earnings                    61,562               33,861
                                ---------            ---------
NET SURPLUS                       120,678              116,142
                                =========            =========
* there were no                                               
  extraordinary items
                                                              
Amount absorbed by interim                                    
  dividend ($ thousands)          107,167              107,042
Rate of interim dividend                                      
  cents per share                       4                    4
Imputation tax credit                                         
  cents per share                0.492537             0.492537
Supplementary dividend                                        
  cents per share                0.176471             0.176471
Adjusted earnings                                             
  cents per share                     4.4                  4.3


1.  All amounts in New Zealand dollars or cents.

2.  This Report has not been audited.

3.  This  Report  should  be  read  in  conjunction  with  the
    Company's interim report to shareholders.

4.  The  dividends will be paid on 8 April 1998.   The  record
    date is 20 March 1998.

5.  An interim report to shareholders will be dispatched about
    8 April 1998 and will be available to the public from that
    date at the Company's office - Stratton House,
    1 Stratton Street, London W1X 5FE.



M B Horton
Company Secretary
5 March 1998



   STATEMENT OF ASSETS, LIABILITIES AND SHAREHOLDERS EQUITY


                                                 CONSOLIDATED
                                     At end      As shown in    As shown in
                                   of current    last Annual     last Half
                                   half year       Report      Yearly Report
                                                                      
                                    $NZ'000        $NZ'000        $NZ'000
CURRENT ASSETS                                                               
(a)  Cash & marketable                                                       
        securities                     287,532        401,594         636,865
(b)  Receivables                       295,323        286,202         214,022
(c)  Short-term investments             10,414          7,579           6,878
(d)  Inventories                       314,034        274,445         295,681
(e)  Other                                 NIL            NIL             NIL
(f)  TOTAL CURRENT ASSETS              907,303        969,820       1,153,446

NON-CURRENT ASSETS
(g)  Receivables                           NIL            NIL             NIL
(h)  Investments                     6,126,729      5,521,139       5,148,715
(i)  Property, plant and                                                     
        equipment                    1,817,377      1,702,170       1,697,565
(j)  Intangibles                       200,663        137,364          92,427
(k)  Other                                 NIL            NIL             NIL
(l)  TOTAL NON-CURRENT ASSETS        8,144,769      7,360,673       6,938,707
(m)  TOTAL ASSETS                    9,052,072      8,330,493       8,092,153

CURRENT LIABILITIES
(a)  Accounts payable                  729,919        623,161         783,727
(b)  Borrowings                        794,140        452,978         516,039
(c)  Provisions                          8,906            948         (3,102)
(d)  Other                                 NIL            NIL             NIL
(e)  TOTAL CURRENT LIABILITIES       1,532,965      1,077,087       1,296,664

NON-CURRENT LIABILITIES
(f)  Accounts payable                      NIL            NIL             NIL
(g)  Borrowings                      2,918,357      2,703,934       2,670,486
(h)  Provisions                         51,892         28,577          18,508
(i)  Other                                 NIL            NIL             NIL
(j)  TOTAL NON-CURRENT                                                       
        LIABILITIES                  2,970,249      2,732,511       2,688,994
(k)  TOTAL LIABILITIES               4,503,214      3,809,598       3,985,658
(l)  NET ASSETS                      4,548,858      4,520,895       4,106,495

SHAREHOLDERS EQUITY
(a)  Paid in share capital           1,865,413      1,863,633       1,862,643
(b)  Reserves                        (574,335)      (571,227)       (575,918)
(c)  Retained profits                2,192,079      2,178,655       2,116,857
(d)  Convertible notes                 269,414        269,414         269,414
(e)  Outside equity interests                                                
        in subsidiaries                796,287        780,420         433,499
(e)  TOTAL SHAREHOLDERS EQUITY       4,548,858      4,520,895       4,106,495



                    REPORT TO SHAREHOLDERS

The  first  half  of 1997/98 has been characterised  by  mixed
results  with  good progress achieved in the  United  Kingdom,
United  States  and Australia partially offset by  the  recent
Asian  crisis which in turn has flowed through to  certain  of
our New Zealand companies, in particular Air New Zealand.

In  this regard it is pleasing to report a profit for the half
year  to  31  December 1997 of $120 million, some  $4  million
above last year's $116 million*.

The  prime  focus of BIL's current year business  plan  is  to
improve  the  underlying operating performance  and  financial
position  of  existing assets to enhance their overall  value.
This  focus,  which  has been underpinned by  key  operational
appointments in New Zealand, Australia and the United Kingdom,
is  resulting  in  improved financial performance.    When  an
acceptable  improvement in value cannot be achieved  within  a
realistic  time  frame,  assets  will  be  sold.   While   new
investment will not be neglected, and research continues on  a
range of new investment opportunities, it remains very much  a
secondary focus of the company for the immediate future.

Progress  on this objective, together with particular features
of the first half are:

UNITED KINGDOM

Thistle  Hotels reported a record hotel operating  profit  for
the  1997 calendar year of  #112.5 million, 9% above the  1996
level  of  #103.3 million and nearly 90% ahead of the lows  of
#60  million  experienced in 1992 and 1993.  This  profit  was
achieved  after  providing  for an additional  #6  million  in
depreciation  arising  from the adoption  of  more  aggressive
depreciation  rates  and  the continuing  capital  expenditure
programme.  This strong performance resulted in an  after  tax
profit  of #76.3 million, an increase of 48% on the comparable
1996 result.

The  buoyant  trading  conditions  prevailing  throughout  the
United  Kingdom were reflected in occupancy levels up  by  1.9
percentage points to 68.6% and average room rates up 10.5%  to
#60.82.   These trends are expected to continue  in  1998  and
result in another record profit.

*Unless otherwise noted, all $ references are to NZ$

Last  year  we  expressed disappointment  at  the  sharemarket
rating   accorded  Thistle  Hotels,  particularly  given   the
continuing  improvement in the underlying performance  of  the
group  and  its  unique positioning in the key London  market.
Major initiatives and developments since then include:

*    the  resignation  of  Chief  Executive,  Robert  Peel  in
     November  1997.   After  an exhaustive  process,  Thistle
     Hotels has a short list of quality prospective candidates
     and   the  appointment  of  a  new  Chief  Executive   is
     anticipated shortly.

*    proposed  rationalisation of the hotel portfolio.   There
     are  currently 95 hotels in the portfolio,  40  of  which
     generate  85%  of  the  profit.   It  is  proposed   that
     approximately 30 provincial hotels with a book  value  of
     approximately  #100 million will be sold.   These  hotels
     together contribute less than 10% of the profit  and  are
     not fundamental to Thistle's overall strategic plan.

*    an  extensive review of Thistle's information  technology
     systems   has   been  undertaken.   It  is  proposed   to
     significantly upgrade these systems with a prime focus of
     improving  the  overall yield management,  together  with
     ensuring  that  all  systems  are  year  2000   and   EMU
     compliant.

These  initiatives, combined with Thistle's commitment to  its
programme  of  refurbishing and, where  possible,  adding  new
rooms  to existing hotels, will collectively provide  a  sound
foundation  for  further  growth in  operating  profitability.
This  has  recently been reflected in an improved  sharemarket
rating,  with the share price recovering from a low of   #1.20
last October to around #1.80 today.

Developments on other United Kingdom investments include:

*    Ibstock plc - Although the underlying performance in  30%
     owned Ibstock has improved, its share price continues  to
     languish.

*    While  it  is  anticipated that  operating  results  will
     continue  to  improve,  the share price  is  unlikely  to
     materially  increase until the company determines,  as  a
     priority, to focus on its business in the United Kingdom.
     This  will require divestment of its non-core investments
     in  Portugal  and  the United States.  BIL  has  strongly
     promoted this view to the company and awaits its response
     before determining its future course of action.

*    English,  Welsh  &  Scottish Railway - In  November,  10%
     owned  EW&S acquired Railfreight Distribution, the former
     British Rail channel freight business.  EW&S continues to
     perform  well  with  current earnings  equivalent  to  an
     acquisition price earnings multiple of only two times.

UNITED STATES

BIL  has  $648 million invested in the United States of  which
$347  million is invested in assets on the mainland  with  the
balance of $301 million representing the Group's investment in
Molokai Ranch in Hawaii.

In  the  six  months  to 31 December, the mainland  US  assets
contributed a profit of $2 million and Molokai Ranch  lost  $9
million.   This  loss principally reflects the  write  off  of
expenditure   associated  with  the  accelerated   development
programme currently underway.

BIL  ceased  making new investments in the  United  States  in
1993.   While in the five years prior to that date  investment
profits of over $550 million had been generated, a few smaller
loss  making investments remained.  In 1993 consideration  was
given  as  to whether these investments should be disposed  of
and  the  losses recognised or whether better value  could  be
achieved  by retaining the assets and progressively  improving
their value.

In  the  event, the collective value of these investments  has
approximately  doubled from around half their accounting  book
value in 1993 so that today their worth is equal to their book
value.    More  importantly, it would have been  difficult  to
find buyers for the assets in 1993, whereas today most of  the
assets  can  be readily disposed of when the opportunities  to
add significant further value have been exploited.
Major investments include:

*    Graham-Field Health Products (Book Value $202 million)
     BIL's  largest  investment is  a  13%  stake  (22%  fully
     diluted)  in  Graham-Field.   Since  Graham-Field  issued
     shares  to  acquire BIL loss making subsidiary Everest  &
     Jennings in 1996, the underlying value of this investment
     has   been  restored.   Graham-Field  has  continued   to
     consolidate its position in the US health care industry -
     most  recently with the acquisition of Fuqua Enterprises,
     manufacturer  of  medical beds, patient  aids  and  other
     complementary  products.  This position is  reflected  in
     record  results over the last three quarters.  The  share
     price  has  steadily appreciated with BIL's  shareholding
     now  having  a  market value of $66  million  above  book
     value.  With Graham-Field financing the Fuqua acquisition
     through  an  issue of shares, BIL's ordinary shareholding
     is now below 20%.  Accordingly, equity accounting of this
     investment ceased during the period.

*    Beverly Prescott Hotel  (Book Value $51 million)
     Acquired 10 years ago as part of the acquisition  of  the
     Associated Hosts restaurant chain, it is only in the last
     four  years  since this Beverly Hills located  hotel  was
     extensively  upgraded  that its  results  have  begun  to
     reflect  its real potential.  Earnings have trebled  over
     the  last  three years and a sale of the hotel at  around
     BIL's book value is currently under negotiation.

*    Associated Hosts (Book Value $16 million)
     Although  a  much  smaller  investment,  this  chain   of
     restaurants has lost between $2 million - $6 million  per
     annum for some years now.  Several initiatives to improve
     the  performance have been pursued, none  of  which  have
     proved  successful.  The company faces severe  challenges
     because  of  the age of its stores (20 years),  disparate
     locations (12 states) and lack of scale (20 restaurants).
     BIL has now determined to exit this investment through  a
     progressive  realisation  of  the  individual  restaurant
     properties.  It is anticipated that this will be achieved
     in 1998, resulting in a modest loss on book value.

As  mentioned earlier, the company has an investment  of  $301
million in Molokai Ranch.  The Master Plan for developing  the
54,000 acre estate on the island of Molokai in Hawaii aims  to
expand  and  diversify economic activity  on  the  island  and
thereby improve the value of BIL's investment.  This is a long
term Plan and the overall Ranch development activities are not
projected to produce a profit for the next two years.

AUSTRALIA

Over  the last five years Australia has become an increasingly
important  focus  for  BIL's new investment  which,  with  the
notable  exception of the company's investment in  Vox  Retail
Group,  has  been particularly successful.  The  current  year
highlight is unquestionably the recent sale of a 7%  stake  in
Coles  Myer resulting in a profit of A$219 million.   This  is
addressed   in  more  detail  in  the  section  on  Investment
Activities.

Particular highlights are:

*    John  Fairfax  -  The implementation of a new  management
     structure,   circulation  revenue   increases   for   all
     metropolitan publications and new initiatives such as the
     launch of the Australian Financial Review weekend edition
     have contributed to a 30% profit increase to A$61 million
     before  abnormals.   During the period  BIL  successfully
     defended   a   referral  by  the  Australian   Securities
     Commission  to  the  Takeover Panel  and  is  now  firmly
     established as the major shareholder in John Fairfax with
     a fully diluted shareholding of nearly 25%.  John Fairfax
     is  committed to a range of revenue enhancing initiatives
     and  cost  efficiency  measures which,  coupled  with  an
     increased  focus  on the core business  activities,  will
     result in enhanced future profits and a higher underlying
     value.

*    James  Hardie - The recent sale of the pipelines division
     represents  the  virtual  completion  of  a   year   long
     restructuring  programme during which proceeds  from  the
     sale  of non-core assets have realised A$590 million  and
     an  overall profit of A$105 million.  The impact of  this
     programme,  coupled with a substantial  increase  in  the
     profitability of the company's US based fibre cement  and
     gypsum businesses,  contributed to an 87% increase in the
     company's  pre-tax profit to  A$64 million  for  the  six
     months  to  30  September.    Considerable  opportunities
     exist  to  substantially improve the underlying value  of
     James Hardie over the next few years.

*    The  Austotel  Trust  -   In the 1997  Annual  Report  we
     reviewed  the  foundations laid for future  growth  which
     revolves   around  the  appointment  of  an   experienced
     management    team,   the  completion   of   a   property
     rationalisation  programme  and  the  development  of   a
     comprehensive three year capital expenditure programme.

*    These measures are designed to double the earnings before
     depreciation and interest (EBITDA) from A$24  million  to
     A$48 million over the next three years.

*    Good  progress has been made towards this objective  with
     sales  for  the  half year up 8.5% to A$157  million  and
     EBITDA  increasing  by  13% to  A$17  million.   A  major
     contributor  has  been  from  gaming  machines  -  at  31
     December  there  were  1,636  gaming  machines   in   the
     portfolio which is forecast to progressively increase  to
     2,400  by  2001.  This is more than double the number  of
     machines currently installed at Sky City in Auckland  and
     virtually the same number as operated at the Crown casino
     in Melbourne.

*    Vox  Retail Group  - Vox incurred a trading loss of  A$20
     million  in the six months to 31 December, a A$6  million
     deterioration on the same period last year.  An  abnormal
     loss   of   A$10.7   million  was  also  incurred   which
     principally  related to the introduction of new  computer
     systems  (in particular point-of-sale) and the write  off
     of  redundant systems.  The performance of Vox  since  it
     was  acquired by BIL in 1994 has been dismal.  While each
     year  we  have  endeavoured  to  improve  the  underlying
     business, the steps taken in the past have largely proved
     to be ineffective.

     We  have carefully reviewed the future prospects for this
     investment and taken a number of actions including:

     -    appointment of a new Chief Executive (January  1998)
          and  Chief  Financial Officer (February 1998).    In
          addition  BIL's  recently appointed Australian-based
          Operations  Director, Jonathan  Pinshaw  (previously
          Managing  Director  of Freedom Furniture)  has  been
          appointed Chairman;

     -    a  new  point-of-sale system has been  installed  in
          every  store  which will allow proper  control  over
          expenses, margins and inventory;

     -    an   increased  focus  on  competitive  positioning,
          especially in relation to product range and customer
          convenience,  together with after sales service;

     -    a  100  day  action plan is underway, the  principal
          objective   of  which  is  to  achieve  an   expense
          reduction of A$20 million per annum by 1 July 1998.

     On  a more positive note, comparable store sales for  the
     first  six  months  increased by 12%,  albeit  that  this
     required  increased expenditure on interest  free  offers
     and higher levels of advertising.  While hesitant to make
     any predictions, we believe Vox will recover and that the
     process is now well underway.

As  highlighted  in  the introduction  to  this  review,  good
progress  has  been made in the United Kingdom, United  States
and  Australia.   This has not been solely a function of  more
buoyant   market   conditions  but  directly  reflects   BIL's
heightened  focus  on improving the value of  each  individual
asset.   This has also been the case in Asia and New  Zealand,
notwithstanding that current market prices have been  impacted
to some extent by the recent Asian economic crisis.

ASIA

The implications of the unprecedented value deterioration that
has  occurred in several Asian markets since mid 1997 are only
now  starting to be fully appreciated.   In some markets,  the
combination  of currency and equity market declines,  together
with  the  almost total lack of liquidity, has resulted  in  a
virtual  paralysis  in  terms  of  undertaking  or  completing
transactions.  Under these circumstances, and in the  case  of
the relatively long lead times associated with a number of our
investments, we will have to accept a longer time horizon  and
will   "weather the storm" in order to extract value.   At  31
December, the book value of BIL's investments within Asia  was
$575 million.

BIL's  largest investment is a 75% stake in AsiaPower, with  a
book  value of $174 million.  AsiaPower has a major commitment
to the Wayang Windu geothermal project in Indonesia; currently
the economy most affected by the Asian crisis.  Stage 1 of the
project, the construction of a 110 megawatt unit, has  reached
financial  closure  and  construction  is  underway  with  the
required steam under the wellhead.  Additional equity of US$80
million is to be provided by AsiaPower which,  together with a
US$250 million underwritten debt facility,  will complete  the
first  stage  of this world class project.  All financing  for
this project is in US dollars, as is the power sales contract.
Subsequent  stages of this project will be progressed  as  and
when conditions allow.

Our joint venture in Seabil Pacific, 49% owned by BIL, with  a
book  value  of  $119 million, owns property  developments  in
China.    The   two  major  developments  are  proceeding   to
completion, with discussions well underway in respect of  pre-
sales  and  leasing.   Both developments are  expected  to  be
completed  within a year and recent independent valuations  of
the projects support BIL's book value.

The  market  capitalisation  of Hong  Kong  based  Paul  Y-ITC
Holdings, 14% owned by BIL with a book value of $142  million,
has  been  significantly  impacted by  the  regional  economic
crisis.  Nonetheless, the company holds record levels of  work
in  progress with a principally "blue chip" client base.   The
current  share price capitalises the company at  $315  million
(equivalent  to  a price earnings multiple of  around  4)  and
values  BIL's  shareholding at $43 million, some  $99  million
below  book  value.   Paul  Y-ITC is currently  undertaking  a
number  of initiatives to improve value transparency and  over
time we expect its market capitalisation to improve.

BIL's  50% partner in GF-Brierley, our Thailand based  natural
resources joint venture  (book value $11 million), is  one  of
56 financial groups placed under administration as a result of
the  currency  and capital markets crisis in Thailand.   As  a
result  BIL  is  now  restructuring  the  ownership  of   this
investment, which will result in some loss in value.

In addition to the above assets, BIL holds a number of smaller
listed equity positions in the region, both through 70%  owned
BIL  Camerlin and in its own right.  These investments have  a
total book value of $129 million and a current market value of
$83  million.  These investments have been impacted to varying
degrees  by  the economic crisis and while there has  recently
been  some  recovery  in market values,  a  further  level  of
provisioning may be required at year end.

While  we did not foresee the extent and severity of the Asian
crisis,  we  have consistently taken a medium term perspective
in  respect  of  our  Asian investments,  characterised  by  a
cautious  investment  approach.  We have  maintained  a  fully
hedged  currency  position in all our Asian investments  which
has helped to minimise the overall diminution in value.  Given
the   uncertainties  within  the  region,  we  ceased   equity
accounting Paul Y-ITC and Seabil Pacific during the period and
did  not  bring to account BIL's share of AsiaPower's  profit.
This more conservative approach resulted in a reduction of the
trading  contribution  from  this region  of  $17  million.

NEW ZEALAND

Air  New Zealand, 42% owned by BIL, recorded a profit  of  $82
million for the six months to 31 December, an increase  of  $5
million over last year.  The recent Asian crisis impacted upon
both load factors and yields in the second quarter.  With this
trend  expected  to  continue through  the  second  half,  the
company  has  reduced its full year profit  forecast  to  $150
million.   Despite  the current difficult  market  conditions,
Air  New Zealand is in a strong financial position and is well
placed for the future, with significant  benefits arising from
its   commercial  alliances  with  Ansett  Australia,   United
Airlines and Singapore Airlines, as well as from Project Save,
a  cost  reduction  programme which  is  expected  to  deliver
savings of $80 million this year.

Notwithstanding Air New Zealand's sound positioning and likely
future  performance,   the sharemarket   has  over-reacted  in
marking   down   the   shares.   Air  New   Zealand's   market
capitalisation  based on the "A" share price, has  reduced  by
$600  million  to  $1,150  million since  30  June.   This  is
equivalent  to  62%  of the underlying  book  value,  a  price
earnings  multiple  of  7.7  times (around  half  the  present
market)  and a gross dividend yield of 14.8% on the  A  shares
(9.9%  net yield).  As with Thistle Hotels last September  and
Coles  Myer  a  year earlier, Air New Zealand shares  are  now
significantly  mispriced  in the market,  trading  well  below
their  long  term underlying value.  Somewhat   paradoxically,
this is occurring concurrent with a major sharemarket rerating
of United States airline stocks.

Auckland  casino operator Sky City, 63% owned by BIL, reported
a pretax profit of $25.2 million for the half year to December
-  an increase of $1.8 million on last year.  Due to its first
full tax charge in the half year, the after tax profit reduced
by  $1.4 million to $16.8 million.  The highlight of the  half
year  was the opening of Sky Tower which has rapidly become  a
"must  see"  attraction in Auckland.  Initiatives  taken  last
year  to  improve financial performance through rigorous  cost
controls, elimination of theatre losses and lifting  food  and
beverage  performance, have paid immediate  dividends.   While
the  Asian crisis will result in a softening of the full  year
profit  to around $33 million, Sky City is now well placed  as
New  Zealand's premier entertainment destination.  Its  unique
market  position,  strong  financial performance  and  quality
defensive  characteristics distinguish it from its  Australian
counterparts.  These characteristics,  together with  its  90%
fully  imputed dividend pay out,  provide excellent investment
fundamentals  which, over time, will lead to a premium  market
rating.

BIL's  resource and commodity based businesses - Central North
Island Forest Partnership (25% owned),  Sealord Products  (50%
owned)   and  Tasman  Agriculture  (57%  owned)  -   are   all
experiencing subdued trading conditions.  While each has sound
long  term prospects, the immediate outlook is for only modest
profit contributions in the current year.

INVESTMENT ACTIVITIES

The  major highlight to date in the current year has been  the
sale  of  the 7% stake in Coles Myer for A$584 million.   This
has  resulted  in  a  profit of A$219 million  of  which  A$16
million  is  accounted for in this half year with the  balance
coming  to  account  in the full year.  This  is  the  largest
single  profit  on  a  transaction in the  company's  history.
BIL's  investment  in  Coles Myer has  been  well  chronicled.
Suffice  to say that at the time BIL acquired its shareholding
in 1995/96, the shares were materially mispriced by the market
and the substantial re-rating accorded to the company over the
last year was a resounding endorsement of BIL's assessment  of
its true value.

Other investment highlights are:

*    sale  of  10.8  million income units in Bass  Strait  Oil
     Trust for a profit of A$28 million.  BIL has now sold all
     the  income  units but retains the residual  units  which
     have  a  book  value of A$133 million and an  independent
     valuation of A$164 million.

*    sale  of 8 million shares (2%) in James Hardie Industries
     at  A$5.15 per share for a profit of A$18 million.   This
     sale  does  not  reflect any change in our  view  of  the
     underlying  value  and  long  term  prospects  for  James
     Hardie,  but  rather our expectation that a  sharp  price
     increase  late last year was unlikely to be sustained  in
     the  short  term.  This has been borne out by our  recent
     purchase of 6 million shares at $4.18 per share.

*    sale  of  20 million shares in Fletcher Energy  for  $103
     million realising a profit of $39 million and the sale of
     a portfolio holding in Asia for $66 million with a profit
     of $15 million.

FINANCIAL POSITION

The half year profit of $120 million was conservatively struck
after  a  provision  of  $23 million was  established  against
BIL's  Asian  investments  and $17 million  in  Asian  trading
profits  were  not brought to account.  Equity  accounting  of
Graham-Field also ceased during the period.

Due  primarily to a material reduction in the value of the New
Zealand  dollar  during the period, total consolidated  assets
increased by $722 million to $9.05 billion.  At the same time,
as   the   company  remains  fully  hedged  on  its   offshore
investments, net debt increased by $669 million - $444 million
of  which  relates  to  foreign exchange  movements  and  $228
million  additional  non-recourse project debt  in  AsiaPower.
The  recent  sale of the Coles Myer shareholding  has  reduced
debt by $600 million, which will be reflected in the full year
accounts.

BIL  continues to maintain a strong financial position and its
Standard & Poor's rating was increased to BBB in August  1997.
While  the  parent  company has good liquidity  with  cash  on
deposit  and  undrawn  funding lines exceeding  $1.2  billion,
BIL's  prime focus remains on improving the value of  existing
assets  and retaining a strong financial position rather  than
on new investment.

INTRINSIC VALUE

The Group has two principal objectives:

*    to  grow  the underlying intrinsic value of the  company,
     and
*    to  ensure that such growth is reflected in shareholders'
     hands through increased returns.

During  the period under review, growth in value was  achieved
in  Australia,  United Kingdom and the United  States.   There
were  significant reductions in the current market  prices  of
the company's investments in Asia and New Zealand (principally
Air  New Zealand) which, in turn, have impacted negatively  on
BIL's  own  share price.  The extent to which these reductions
are temporary and result from mispricing or are to some extent
more permanent value reductions, remains to be seen.

Provided there is no further deterioration in the economies in
which  we operate,  we expect the Group's underlying value  at
30  June to be maintained at least around the June 1997 levels
-  equivalent to $1.2 billion or 11% tax paid per annum growth
over  three  years.   In  that event,  the  company's  overall
objective to grow value by $2 billion over the three years  to
30 June 1998 will obviously take longer to achieve.

DIVIDEND

The  Board  has  declared an unchanged interim dividend  of  4
cents  per share of which 1 cent will again be fully  imputed.
Foreign shareholders will receive a supplementary dividend  in
lieu of imputation credits.  The interim dividend will be paid
on 8 April 1998.

OUTLOOK

We  anticipate that the trends experienced in the  first  half
will continue for the balance of the financial year:

*    the  company's investments in the United Kingdom,  United
     States and Australia, where BIL has invested $4.5 billion
     or  two-thirds  of its assets, will continue  to  perform
     strongly;

*    Asia  and New Zealand, regions in which one-third of  the
     company's   assets   are  invested,  will   continue   to
     experience difficult operating environments.

Overall,  while  it  will be difficult to achieve  significant
value growth in the current financial year, reported profit is
expected to be ahead of last year's $311 million.



Paul Collins                    Bob Matthew
Chief Executive                 Chairman


               Wellington, Thursday 5 March 1998



END

IR DZFFBVXKLBKK