SWANK INT'L MFG<0663> - Results Announcement
Swank International Manufacturing Company Limited announced on 15/5/2000:
(stock code: 663)
The accounts which contain the following results are qualified by
the Company's auditor. For more details, please refer to the press
announcement issued by the Company on 16/5/2000.
Year end date: 31/12/1999
Currency: HK$ (Audited)
(Audited) Last
Current Corresponding
Period Period
from 1/1/1999 from 1/1/1998
to 31/12/1999 to 31/12/1998
('000) ('000)
Turnover
- Continuing : 315,090 373,446
- Discontinued : - -
Operating (Loss)
- Continuing : (32,720) (312,124)
- Discontinued : - -
Total Operating (Loss) : (32,720) (312,124)
Share of (Loss) of
Associated Companies : (6,256) (11,371)
Share of Profit/(Loss) of
Jointly Controlled Entities : - -
(Loss) after Tax & MI : (37,746) (323,568)
% Change over Last Period : N/A
EPS/(LPS) -Basic : (6.5 cents) (90.2 cents)
-Diluted : (6.5 cents) (90.2 cents)
Extraordinary (ETD) Gain/(Loss) : NIL NIL
(Loss) after ETD Items : (37,746) (323,568)
Final Dividend per Share : NIL NIL
(Specify if with other options) : - -
B/C Dates for Final Dividend : -
Payable Date : -
B/C Dates for (-) General Meeting : -
Other Distribution for Current Period : -
B/C Dates for Other Distribution : -
Remarks:
1. The basis of presentation of results for companies having reorganized
of Financial restructuring of the Group's indebtedness
On 30 April 1999, the Company entered into a Compromise Agreement with the
Group's bankers (the "Banks") pursuant to which the Banks agreed to
restructure the Group's indebtedness with a view to significantly reducing
the amount of the Group's debt and its related debt servicing burden. At
an Extraordinary General Meeting held on 31 May 1999, the Company
successfully obtained approval from its shareholders to the Compromise
Agreement. As a result of the completion of the Compromise Agreement, the
Banks assigned the following to the Company:
(i) 100% of the debts owed by the Company's subsidiaries to the Banks
amounting to $545 million; and
(ii) 75% of the debts owed by the Company's associates to the Banks
amounting to $12 million.
Following these assignments, the debts owed by the Company to the Banks
(the "Bank Debt") increased from $545 million to $1,102 million. In
accordance with the Compromise Agreement, the Bank Debt was restructured
as follows:
(i) $250 million bank loan ("New Loan") - $250 million of the Bank Debt
were discharged by the Banks and replaced by $250 million new loan on the
terms of the New Loan Agreement between the Company and the Banks;
(ii) $300 million convertible notes ("New Convertible Notes") - $300
million of the Bank Debt were discharged by the Banks in consideration of
the Company issuing $300 million of convertible notes to Optiset Limited;
and
(iii) Issue of ordinary shares representing 51% of enlarged issued share
capital ("New Shares") - the remaining Bank Debt of approximately $552
million were discharged, in consideration for the Company issuing
373,342,850 new ordinary shares which represent 51% of the enlarged issued
share capital of the Company to the Optiset Limited.
As a result of issuance of New Shares to Optiset Limited, Optiset Limited
became the substantial shareholder of the Company. Optiset Limited is a
single purpose company established to hold the New Convertible Notes and
New Shares on behalf of the Banks.
Pursuant to the standstill agreement signed between the Company and the
Banks in July 1997, the Group executed several debentures incorporating
fixed and floating charges over all of the undertaking, property and
assets of certain Group companies as security for the outstanding
indebtedness. After the completion of the Compromise Agreement, these
debentures were amended to provide all such securities for the New Loan
and the New Convertible Notes.
2. Operating Loss
Note 1999 1998
HK$'000 HK$'000
Turnover 315,090 373,446
Cost of sales (228,495) (271,737)
---------- -----------
Gross profit 86,595 101,709
Other revenue 8,173 7,380
Other net income 2.1 51,944 14,859
---------- -----------
146,712 123,948
Selling expenses (43,093) (48,732 )
Administrative expenses (45,020) (54,292 )
Other operating expenses 2.2 (36,611) (237,803)
---------- ----------
Profit/(loss) from operations 21,988 (216,879)
Finance cost (54,708) (95,245 )
---------- -----------
Net Operating Loss (32,720) (312,124)
========= =========
Notes :
2.1 Other net income 1999 1998
HK$'000 HK$'000
Gain on settlement of
obligation to SHK (note a) 24,000 --
Exchange gain on notes
payable (note b) 3,114 14,859
Gain on settlement of notes
payable (note c) 24,830 --
------------ -------------
51,944 14,859
======= =======
Notes:
(a) Gain on settlement of obligation to Sun Hung Kai China Development
Fund Limited ("SHK") arises from a put option being granted to purchase
back the interest in a subsidiary of the Group on 20 April 1994, which was
subsequently settled at a discount.
(b) Exchange gain on notes payable for 1999 and 1998 arises from the
translation of the notes payable from its original denomination in
Indonesian rupiah to Hong Kong dollars as at 23 March 1999 and 31 December
1998 respectively.
(c) Gain on settlement of notes payable represents gain arising on the
Group's full redemption of its Indonesian Rupiah Notes on 23 March 1999 at
a discount.
2.2 Other operating expenses
1999 1998
HK$'000 HK$'000
Reconstruction cost (note a) (23,278) (14,358 )
Provision for inventories (note b) (6,260) (15,535)
Net loss on disposal/write-off of
fixed assets (note c) (3,971) (11,310 )
Provision for doubtful debts (note d) (1,862) (24,620 )
Provision for diminution in
value of properties (note e) - (38,745 )
Provision for diminution in value
of associates (note f) (258) (133,235)
Others (982) -
-------------- -------------
(36,611) (237,803)
======= =======
Notes:
(a) Reconstruction cost in 1999 and 1998 represents professional fees
arising from the Group's standstill arrangements, Compromise Agreement,
special reviews and financial legal advice on the restructuring plans.
(b) Provision for inventories in 1999 and 1998 represents the net
provision for slow-moving and obsolete stocks. The provisions are made
based on the director's estimate of the net realisable value of stocks.
(c) Net loss on disposal/write-off of fixed assets in 1999 represents
disposal of fixed assets and assets being written off due to wear, tear
and obsolescence. Write-off of fixed assets in 1998 represents write-off
of fixed assets with no economic value to the Group's business, based on
the directors' exercise of re-assessing the economic useful lives of the
fixed assets.
(d) Provision for doubtful debts in 1999 represents provision for other
receivable. Provision for doubtful debts in 1998 represents the directors'
best estimate of the amounts due from Hanmy (Holding) Limited and its
subsidiaries which is not recoverable.
(e) Provision for diminution in value of properties in 1998 reflects the
difference between the net book value and the professional valuation
conducted by C.Y. Leung & Company Limited of certain properties of the
Group as at 31 December 1998.
(f) Provision for diminution in value of associates, which is other than
temporary, represents the directors' best estimate of diminution in value
for the Group's interest in certain associates.
3. Loss per share
(a) Basic loss per share
The calculation of basic loss per share is based on the loss attributable
to shareholders of HK$37,746,211 (1998: loss of HK$323,568,181) and on the
weighted average of 577,593,379 ordinary shares (1998: 358,701,955) in
issue during the year.
(b) Diluted loss per share
There were no dilutive potential ordinary shares in existence during the
years 1999 and 1998.
4. Explanation for the change of the diluted loss per share for 1998
Owing to the adoption of the requirements of SSAP 5 (revised) " Earnings
per share", the reported diluted loss per share for 1998 was adjusted from
"N/A" to "(90.2 cents)".
For more details, please refer to the press announcement today.
|
