MATRIX HOLDINGS<01005> - Results Announcement
Matrix Holdings Limited announced on 16/03/2006:
(stock code: 01005 )
Year end date: 31/12/2005
Currency: HKD
Auditors' Report: Modified
(Audited )
(Audited ) Last
Current Corresponding
Period Period
from 01/01/2005 from 01/01/2004
to 31/12/2005 to 31/12/2004
Note ('000 ) ('000 )
Turnover : 911,044 686,684
Profit/(Loss) from Operations : 136,318 177,852
Finance cost : (35) (89)
Share of Profit/(Loss) of
Associates : N/A N/A
Share of Profit/(Loss) of
Jointly Controlled Entities : N/A N/A
Profit/(Loss) after Tax & MI : 140,929 151,810
% Change over Last Period : -7.2 %
EPS/(LPS)-Basic (in dollars) : 0.24 0.27
-Diluted (in dollars) : N/A 0.26
Extraordinary (ETD) Gain/(Loss) : N/A N/A
Profit/(Loss) after ETD Items : 140,929 151,810
Final Dividend : $0.09 $0.09
per Share
(Specify if with other : N/A N/A
options)
B/C Dates for
Final Dividend : 20/04/2006 to 25/04/2006 bdi.
Payable Date : 03/05/2006
B/C Dates for Annual
General Meeting : 20/04/2006 to 25/04/2006 bdi.
Other Distribution for : N/A
Current Period
B/C Dates for Other
Distribution : N/A
Remarks:
FOR THE YEAR ENDED 31ST DECEMBER, 2005
SUMMARY OF THE AUDITORS' REPORT
The followings are the extraction from the auditors' report with
modification:
Without qualifying our opinion, we draw attention to the basis of
preparation of financial statements which explains that in October 1999
there was a court judgment regarding the ownership of Matrix Plastic
Manufacturing (Zhongshan) Co., Ltd. ("MPMZ"), an indirect wholly-owned
major subsidiary of the Company, in connection with a claim made by a
trade creditor, which had subsequently been settled. The Company has made
an application for a judicial review of the judgment regarding the
ownership of MPMZ. The directors have sought independent legal advice and
are of the opinion that the aforesaid judgment can be overruled and will
have no material impact on the financial position and operations of the
Group.
THE BASIS OF PREPARATION OF FINANCIAL STATEMENTS
In October 1999, there was a court judgment regarding the ownership of
MPMZ, an indirect wholly-owned major subsidiary of the Company, in
connection with a claim made by a trade creditor, which had subsequently
been settled. The Company has made an application for a judicial review
of the judgment regarding the ownership of MPMZ. In 2002, the Company
received an acknowledgement from Zhongshan Intermediate People's Court
that Guangdong High People's Court has transferred the Company's
application to Zhongshan Intermediate People's Court for processing. The
directors have sought independent legal advice and are of the opinion that
the aforesaid judgment can be overruled and will have no material impact
on the financial position and operations of the Group. Accordingly, MPMZ
is still treated as an indirect subsidiary of the Company.
NOTES:
1. BASIS OF PREPARATION
The consolidated financial statements have been prepared in accordance
with Hong Kong Financial Reporting Standards issued by the Hong Kong
Institute of Certified Public Accountants ("HKICPA"). In addition, the
consolidated financial statements include applicable disclosures required
by the Rules Governing of the Listing of Securities on The Stock Exchange
of Hong Kong Limited and by the Hong Kong Companies Ordinance.
The consolidated financial statements have been prepared on the historical
cost basis except for certain property, plant and equipment and financial
instruments, which are measured at revalued amounts or fair values.
2. APPLICATION OF HONG KONG FINANCIAL REPORTING STANDARDS / CHANGES
IN ACCOUNTING POLICIES
In the current year, the Group has applied, for the first time, a number
of new Hong Kong Financial Reporting Standards ("HKFRSs"), Hong Kong
Accounting Standards ("HKASs") and Interpretations (hereinafter
collectively referred to as "new HKFRSs") issued by the HKICPA that are
effective for accounting periods beginning on or after 1st January, 2005,
other than HKFRS 3 "Business Combinations", HKAS 36 "Impairment of Assets"
and HKAS 38 "Intangible Assets" that had been early adopted for the year
ended 31st December, 2004. The application of the new HKFRSs has resulted
in a change in the presentation of the consolidated income statement,
consolidated balance sheet and consolidated statement of changes in
equity. In particular, the presentation of the minority interest has been
changed. The changes in presentation have been applied retrospectively.
The adoption of the new HKFRSs has resulted in changes to the Group's
accounting policies in the following areas that have an effect on how the
results for the current or prior accounting years are prepared and
presented:
Financial Instruments
In the current year, the Group has applied HKAS 39 "Financial Instruments:
Recognition and Measurement". HKAS 39, which is effective for annual
periods beginning on or after 1st January, 2005, generally does not permit
to recognise, derecognise or measure financial assets and liabilities on a
retrospective basis. The principal effect resulting from the
implementation of HKAS 39 is summarised below:
Classification and measurement of financial assets and financial
liabilities
The Group has applied the relevant transitional provisions in HKAS 39 with
respect to classification and measurement of financial assets and
financial liabilities that are within the scope of HKAS 39.
By 31st December, 2004, the Group classified and measured its debt and
equity securities in accordance with the alternative treatment of
Statement of Standard Accounting Practice 24 ("SSAP 24"). Under SSAP 24,
investments in debt or equity securities are classified as "trading
securities", "non-trading securities" or "held-to-maturity investments" as
appropriate. Both "trading securities" and "non-trading securities" are
measured at fair value. Unrealised gains or losses of "trading securities"
are reported in the profit or loss for the period in which gains or losses
arise. Unrealised gains or losses of "non-trading securities" are reported
in equity until the securities are sold or determined to be impaired, at
which time the cumulative gain or loss previously recognised in equity is
included in the profit or loss for that period. From 1st January, 2005
onwards, the Group classifies and measures its debt and equity securities
in accordance with HKAS 39. Under HKAS 39, financial assets are classified
as "financial assets at fair value through profit or loss", "available-
for-sale financial assets", "loans and receivables", or "held-to-maturity
financial assets". "Financial assets at fair value through profit or loss"
and "available-for-sale financial assets" are carried at fair value, with
changes in fair values recognised in profit or loss and equity
respectively. "Loans and receivables" and "held-to-maturity financial
assets" are measured at amortised cost using the effective interest
method.
On 1st January, 2005, trading securities reported under SSAP 24 was
classified as held for trading investment of "financial assets at fair
value through profit or loss" category upon the adoption of the HKAS 39.
Accordingly, no adjustment to retained profits at 1st January, 2005 was
required.
Owner-occupied Leasehold Interest in Land
In previous years, owner-occupied leasehold land and buildings were
included in property, plant and equipment and measured using the
revaluation model. In the current year, the Group has applied HKAS 17 "
Leases". Under HKAS 17, the land and buildings elements of a lease of land
and buildings are considered separately for the purposes of lease
classification, unless the lease payments cannot be allocated reliably
between the land and buildings elements, in which case, the entire lease
is generally treated as a finance lease. To the extent that the allocation
of the lease payments between the land and buildings elements can be made
reliably, the leasehold interests in land are classified to prepaid lease
payments under operating leases, which are carried at cost and amortised
over the lease term on a straight-line basis. Alternatively, where the
allocation between the land and buildings elements cannot be made
reliably, the leasehold interests in land continue to be accounted for as
property, plant and equipment. This change in accounting policy does not
have effect to prior periods because the amount of land and building
cannot be allocated reliably between the land and buildings elements at
31st December, 2004.
3. EARNINGS PER SHARE
The calculation of basic and diluted earnings per share attributable to
the equity holders of the Company is based on the following data:
Earnings
2005 2004
HK$'000 HK$'000
Earnings for the purposes of basic earnings per share
140,929 151,810
Effect of dilutive potential ordinary shares:
Interest on convertible loan stock - 73
-----------------
Earnings for the purposes of diluted earnings per share
140,929 151,883
-----------------
Number of shares
2005 2004
'000 '000
Weighted average number of ordinary shares for the
purposes of basic earnings per share 584,720 570,013
Effect of dilutive potential ordinary shares:
Convertible loan stock - 14,707
----------------
Weighted average number of ordinary shares for
the purposes of diluted earnings per share N/A 584,720
----------------
The computation of diluted earnings per share does not assume the exercise
of the Company's outstanding share options as the exercise price of those
options is higher than the average market price for shares for 2005.
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