SIM TECH<02000> - Results Announcement
SIM Technology Group Limited announced on 16/03/2006:
(stock code: 02000 )
Year end date: 31/12/2005
Currency: HKD
Auditors' Report: Unqualified
(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 : 2,719,585 1,567,074
Profit/(Loss) from Operations : 313,001 217,465
Finance cost : (4,516) (4,768)
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 : 290,662 155,534
% Change over Last Period : +86.9 %
EPS/(LPS)-Basic (in dollars) : 0.221 0.138
-Diluted (in dollars) : N/A N/A
Extraordinary (ETD) Gain/(Loss) : N/A N/A
Profit/(Loss) after ETD Items : 290,662 155,534
Final Dividend : $0.14 Nil
per Share
(Specify if with other : N/A N/A
options)
B/C Dates for
Final Dividend : 18/04/2006 to 21/04/2006 bdi.
Payable Date : 28/04/2006
B/C Dates for Annual
General Meeting : 18/04/2006 to 21/04/2006 bdi.
Other Distribution for : N/A
Current Period
B/C Dates for Other
Distribution : N/A
Remarks:
1. General information and group reorganisation
General information
SIM Technology Group Limited (the "Company") was incorporated in Bermuda
on 27 October 2004 as a limited company under the Companies Act 1981 of
Bermuda (as amended) with limited liability. Its ultimate holding company
is Info Dynasty Group Limited, a company incorporated in the British
Virgin Islands. The addresses of the registered office and principal
place of business of the Company are disclosed in the introduction to the
annual report.
The Company is an investment holding company. The principal activities of
its subsidiaries are the manufacturing, design and development and sales
of liquid crystal display modules, complete mobile handsets, handsets
design solutions (in Semi Knock-Down/Complete Knock-Down form), and
wireless communication module solutions.
Reorganisation
Pursuant to a reorganisation (the "Reorganisation") to rationalise the
structure of the Company and its subsidiaries (the "Group") in preparation
for the listing of the Company's shares on the Main Board of The Stock
Exchange of Hong Kong Limited (the "Stock Exchange"), the Company became
the holding company of the Group on 3 June 2005 by issuing shares in
exchange for the entire issued share capital of SIM Technology Group (BVI)
Limited. Details of the Reorganisation are set out in the Prospectus
dated 21 June 2005.
The shares of the Company have been listed on the Main Board of the Stock
Exchange since 30 June 2005.
The Group resulting from the Reorganisation is regarded as a continuing
entity. Accordingly, the consolidated financial statements have been
prepared in a manner consistent with pooling of interest and in accordance
with the respective equity interests in the individual companies
attributable to the common controlling shareholders.
2. Presentation of financial statements
The presentation currency of the financial statements of the Group was
changed from Renminbi to Hong Kong dollars, which is the functional
currency of the Company, during the current year. The directors consider
that the change has resulted in a more appropriate presentation.
Comparative amounts have been restated in Hong Kong dollars in order to
achieve a consistent presentation.
3. Adoption of new and revised international financial reporting
standards
In the current year, the Group has adopted all the new and revised
Standards and Interpretations (hereinafter collectively referred to as "
new IFRSs") issued by the International Accounting Standards Board ("IASB
") and the International Financial Reporting Interpretations Committee ("
IFRIC") of the IASB that are relevant to its operations and effective for
accounting periods beginning on or after 1 January 2005. The adoption of
the new IFRSs has resulted in a change in the presentation of the
consolidated income statement, consolidated balance sheet and the
consolidated statement of changes in equity. In particular, the
presentation of minority interests
has been changed. The changes in presentation have been applied
retrospectively. The adoption of the new IFRSs 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 accounting periods
are prepared and presented.
The impact of the changes in accounting policies is discussed below. The
impact on basic and diluted earnings per share is discussed in note 5.
Business combinations
In the current year, the Group has applied IFRS 3 "Business Combinations"
which is effective for business combinations for which the agreement date
is on or after 1 January 2005. The principal effects of the application
of IFRS 3 to the Group are summarised below:
Excess of the Group's interest in the net fair value of acquiree's
identifiable assets, liabilities and contingent liabilities over cost (
previously known as "negative goodwill")
In accordance with IFRS 3, any excess of the Group's interest in the net
fair value of acquiree's identifiable assets, liabilities and contingent
liabilities over the cost of acquisition ("discount on acquisition") is
recognised immediately in profit or loss in the period in which the
acquisition takes place. In previous periods, negative goodwill arising
on acquisitions prior to 1 January 2001 was held in reserves, and negative
goodwill arising on acquisitions after 1 January 2001 was presented as a
deduction from assets and released to income based on an analysis of the
circumstances from which the balance resulted. The change in accounting
policy has had no impact to the financial statements and no prior year
adjustment has been required.
IFRS 2 Share-based payments
In the current year, the Group has applied IFRS 2 Share-based Payment
which requires an expense to be recognised where the Group buys goods or
obtains services in exchange for shares or rights over shares ("equity-
settled transactions"), or in exchange for other assets equivalent in
value to a given number of shares or rights over shares ("cash-settled
transactions"). The principal impact of IFRS 2 on the Group is in
relation to the expensing of the fair value of directors' and employees'
share options of the Company determined at the date of grant of the share
options over the vesting period. The Group has applied IFRS 2 to share
options granted on or after 1 January 2005. The effect of the changes in
the accounting policy has resulted in the decrease of the net profit for
the current year by approximately HK$6,670,000 (included in administrative
expenses), being the recognition of share based payments for the current
year, and a corresponding increase to share options reserve. The Company
did not grant any option before 1 January 2005 and no prior year
adjustment has been required.
The Group has not early applied, the following new standards and
interpretations and amendments that were issued but are not yet effective:
IAS 1 (Amendment) Capital disclosures 1
IAS 19 (Amendment) Actuarial gains and losses, group plans
and disclosures 2
IAS 21 (Amendment) Net investment in foreign operation 2
IAS 39 (Amendment) Cash flow hedge accounting of forecast
intragroup transactions 2
IAS 39 (Amendment) The fair value option 2
IAS 39 & IFRS 4 Financial guarantee contracts 2
(Amendments)
IFRS 6 Exploration for and evaluation of mineral resources 2
IFRS 7 Financial instruments: Disclosures 1
IFRIC - INT 4 Determining whether an arrangement contains a
lease 2
IFRIC - INT 5 Rights to interests arising from decommissioning,
restoration
and environmental rehabilitation funds 2
IFRIC - INT 6 Liabilities arising from participating in a
specific market
- waste electrical and electronic equipment 3
IFRIC - INT 7 Applying the restatement approach under IAS 29
Financial Reporting in Hyperinflationary Economies 4
IFRIC - INT 8 Scope of IFRS 2 5
IFRIC - INT 9 Reassessment of Embedded Derivatives 6
1 Effective for annual periods beginning on or after 1
January 2007.
2 Effective for annual periods beginning on or after 1
January 2006.
3 Effective for annual periods beginning on or after 1
December 2005.
4 Effective for annual periods beginning on or after 1 March
2006.
5 Effective for annual periods beginning on or after 1 May
2006.
6 Effective for annual periods beginning on or after 1 June
2006.
The Group has considered these standards, interpretations and amendments
but does not expect they will have material effect on how the results of
the operations and financial position of the Group are prepared and
presented.
4. Significant accounting policies
The consolidated financial statements have been prepared in accordance
with International Financial Reporting Standards. In addition, the
consolidated financial statements include applicable disclosure required
by the Rules Governing the Listing of Securities on the Stock Exchange and
by the Hong Kong Companies Ordinance.
The consolidated financial statements have been prepared on the historical
cost basis except for financial instruments which are initially measured
at fair value.
5. Earnings per share
The calculation of earnings per share is based on profit attributable to
equity holders of the parent of approximately HK$290,662,000 (2004: HK$
155,534,000) and on 1,315,068,000 (2004: 1,125,000,000) weighted average
number of ordinary shares in issue for the year.
The calculation of weighted average number of ordinary shares for the year
ended 31 December 2005 and 2004 were based on the assumption that the
Reorganisation had been completed on 1 January 2005 and 1 January 2004
respectively.
No diluted earnings per share has been presented for the year ended 31
December 2005 because the exercise price of the Company's options, after
taken into account of the effect of share-based payment, was higher than
the average market price for shares during the year.
Diluted earnings per share for the year ended 31 December 2004 was not
disclosed as there were no potential ordinary shares outstanding during
the year.
Impact of changes in accounting policy
Changes in the Group's accounting policies during the year are described
in details in note 3. To the extent that those changes have had an impact
on results reported for the year ended 31 December 2005, they have had an
impact on the amounts reported for earnings per share. The following
table summaries that impact on earnings per share:
2005
Impact on
earnings per share
HK cents
Recognition of share-based payments as expenses 0.51
-------------------
The changes in the Group's accounting policies during the year had no
impact on results reported for the year ended 31 December 2004, hence they
had no impact on the amounts reported for earnings per share.
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