E-Malt.com News article: 2511

China: Savings in finance costs and lower provisions lifted Guangdong Investment's 2003 net profit to HK$1.11 billion, a leap of 467 per cent from the previous year's HK$194.9 million, The Standard, Greater China’s Business Newspaper posted on April 20. Finance costs were HK$877.5 million lower than in 2002, due mainly to savings in interest on bank loans, overdrafts and other borrowings.

Net provisions were 84 % lower at HK$51.9 million, mostly in write-back of provisions on hotel assets that were previously provided against the interim results last year due to the Sars outbreak, and the recovery of an impairment loss of a deconsolidated subsidiary. The company made a provision of HK$219.8 million for the year, which was partially offset by the write-back.

Turnover during the year fell 23 per cent to HK$5.2 billion, due largely to the HK$1.5 billion disposal of most non-core businesses in March last year and a drop in turnover in the hotel business during the Sars outbreak. Turnover in discontinued operations, which include a brewery, tannery, malting and tour operations, dropped 84 per cent to HK$338 million.

The biggest fall in turnover occurred in Hong Kong operations, which dipped 63 %, while turnover was down 20 per cent in the mainland. The group's cash and bank balances dropped HK$405 million last year, to HK$1.38 billion, due to the repayment and prepayment of the remaining bank debts that were restructured in December 2000.

Although the group's principal activities are water and power supply, it has diverse operations including department stores, hotels, property development, and various manufacturing and trading ventures. Despite the strong growth in profit no dividend was recommended.


21 April, 2004