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South China Morning Post (Holdings) Limited Annual Report 1998
• Corporate Information
• Chairman's Report
• Facing The Future
• Five Year Financial Summary
• Report Of The Directors
• Audited Financial Statements
• Notes To Financial Statements
• Report Of The Auditors
Copyright © 1998. South China Morning Post Publishers Ltd. All rights reserved.
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South China Morning Post (Holdings) Limited Cooperation Information
Corporate Information
Board of Directors Registered Office &
Kuok Khoon Ean Principal Place of Business
Chairman Cedar House
41 Cedar Avenue
Roberto V. Ongpin
Hamilton, HM12 Bermuda
Deputy Chairman
Owen R. Jonathan Morning Post Centre

Chief Executive Dai Fat Street
Tai Po Industrial Estate
Rayner Cheung Yun Kwun New Territories, Hong Kong
Executive Director
28-29/F, Dorset House
The Hon. Ronald J. Arculli 979 King's Road
Director Quarry Bay, Hong Kong
Paul J. C. Bush Principal Bankers

Director The Hongkong and Shanghai Banking
Corp. Limited
The Rt. Hon. Sir Percy Cradock 1 Queen's Road, Central, Hong Kong
Director
Lindley J. Holloway The Bank of East Asia, Limited

Director 10 Des Voeux Road, Central, Hong
Kong
Tan Sri Dr. Khoo Kay Peng
Director Solicitors
Deacons Graham & James
Kuok Khoon Ho 3-6/F, Alexandra House, Hong Kong
Director
Freshfields
Peter Lee Ting Chang 12/F, Two Exchange Square, Hong
Director Kong
Dr. The Hon. David Li Kwok Po Auditors

Director
Ernst & Young
Certified Public Accountants
Audit Committee
15/F, Hutchison House
The Hon. Ronald J. Arculli
10 Harcourt Road, Central, Hong Kong
Paul J.C. Bush
South China Morning Post (Holdings) Limited Cooperation Information
Peter Lee Ting Chang Share Registrars

Central Registration Hong Kong
Company Secretary Limited
Charisa C.C. Suen 19/F, Hopewell Centre
183 Queen's Road East, Hong Kong
Butterfield Corporate Services Limited

65 Front Street, Hamilton, Bermuda
South China Morning Post (Holdings) Limited

is incorporated in Bermuda with limited
liability
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[ Report Of The Auditors ]
Copyright © 1998 South China Morning Post Publishers Ltd. All rights reserved.
South China Morning Post (Holdings) Limited Chairman's Report '98
Chairman's Report
I am pleased to submit the annual report of the Company for the year ended 30
June 1997 to shareholders.
Operating Results
During the first four months of the financial year
from July to October 1997, the Company's
newspaper operations enjoyed a high turnover in
advertising revenue and profitability, reflecting the
continuing positive business sentiment in the newly
established Special Administrative Region of Hong
Kong. By November 1997, however, the financial
turmoil sweeping through much of Asia began to
affect the financial and property markets in Hong
Kong.
With a slowdown in financial market
activity as well as a broad reduction in consumer
spending, the South China Morning Post's display
advertising revenue was adversely affected from the
fourth quarter of 1997. Meanwhile the newspaper's
classified advertising revenue, which in large part
comprises recruit- ment advertising, began to reflect
the worsening conditions in Hong Kong's labour
markets by the first quarter of 1998, with continuing
corporate retrenchment and business closures.
Against this increasingly unfavourable
economic background, the Company achieved an
operating profit of HK$800.5 million (1997:HK $947.8 million) from a
turnover of HK$2,236.3 million (1997: HK $2,352.5 million) during the
financial year ended 30 June 1998. Included in these figures is a newspaper
operating profit of HK$760.9 million (1997: HK$850.4 million) from a
turnover of HK$1,416.4 million (1997: HK$1,513.2 million).
In the first half of the financial year investments approved by the Board
amounting to HK$314 million in listed shares were added to the Company's
investment portfolio. The total invested at 30 June 1998 amounted to HK$467
million comprising shares in Belle Corporation, Cheung Kong, CLP Holdings,
Citic Pacific, CKI Holdings, Founder (HK), Guoco Group, Hang Seng Bank,
Henderson Land, HSBC Holdings, Hutchison Whampoa, Hysan Development,
Kerry Properties, Ng Fung Hong, Shangri-La Asia, Sinophil Corporation, Sino
Land, Sun Hung Kai Properties and Swire Pacific ‘A’. However, in light of the
severe decline in the Hong Kong and Philippine stock markets in recent months
and the unlikely prospect of any early recovery, the Directors decided to make
a provision against the cost of the portfolio by marking it down to market at 26
June 1998.
Accordingly, an exceptional item of HK$256 million reduced the net
profit attributable to shareholders to HK$412.2 million for the year ended 30
June 1998 (1997: HK$ 805.3 million).
Dividend
An interim dividend of 15 cents per share was paid during the year. Your
Directors are recommending a final dividend of 15 cents per share, making a
total payment of 30 cents for the year.
Editorial
The South China Morning Post is Hong Kong's leading English-language
newspaper, with dominant market shares in circulation, readership, and
advertising within the English-language newspaper sector. Efforts will
continue to be taken to improve the quality, depth and breadth of the
newspaper's coverage. To this end, the newspaper now provides wider
coverage and analysis of news from the China mainland by recently opening a
news bureau in Guangzhou to complement our existing presence in Beijing and
in Shanghai.
Electronic Publishing
I am pleased to report that during the past year the Internet Edition of our
newspaper has won two prestigious awards for quality and excellence. First, in
February 1998, the Internet Edition was named recipient of the 1998 EPpy
Award for Best Non-US Newspaper Online Service by Editor and Publisher
Magazine. Then, in June 1998, at the 1998 Digital Edge Online Newspaper
Awards organized by the Newspaper Association of America, the Internet
Edition received the Outstanding Achievement award for Best News
Presentation. Receipt of these awards has brought much encouragement to our
electronic publishing and other “new media” activities.
The Internet Edition of the South China Morning Post has significantly
enhanced the instantaneous reach of our newspaper to a worldwide audience,
and has set standards of excellence in online journalism, despite a short history
and operating under tight budgets. Although revenue streams have been slow to
develop for new media businesses, the activities of our PostNet division allow
us to extend our newspaper franchise into a rapidly developing market where
there may be significant and, in the long term, profitable opportunities to
exploit.
Circulation and Readership

The circulation of the South China Morning Post continued to register modest
but steady growth during the past financial year, while the South China Sunday
Morning Post experienced a small decline.

The figures certified by the United Kingdom-based Audit Bureau of
Circulations are shown in the table below:-
Circulation
South China Morning South China Sunday
Period
Post Morning Post
July - December 1996 116,992 87,934
July - December 1997 119,921 89,378
January - June 1997 105,808 89,775
January - June 1998 106,609 88,571
International survey research firm AC Nielsen has estimated the readership of
the South China Morning Post at 280,000 in the period 1 July 1996 to 30 June
1997. This is a 10.76% increase in readership from the previous year.
New Printing Press

Installation activities at the Company's Tai Po printing plant started in June
1998 for the new printing press and upgrades of our existing presses.
Commissioning of the new equipment, which was purchased from Germany's
MAN Roland for about HK$100 million, is expected to take place during the
fourth quarter of 1998. The new press is expected to become fully operational
by early 1999, and will enable the South China Morning Post to enjoy a higher
degree of production flexibility both in terms of additional pagination and
increased availability of colour.
Installation of a fourth printing press will also allow our engineering
department to better schedule maintenance and repair work on the existing
presses without disrupting the daily production routine. This investment will
also position the newspaper to enhance its market leadership and to capture
additional and higher margin revenue streams once the Hong Kong economy
begins to recover.
The Post Publishing Public Co., Ltd.

Post Publishing PCL, which publishes the Bangkok Post and is 20.3% owned
by the Company, earned net income of Baht 26.9 million (1996: Baht 164.6
million) in the year ended 31 December 1997. During the six months ended 30
June 1998, Post Publishing continued to trade profitably in a very difficult
economic environment, earning net income of Baht 9.1 million (1997: Baht
48.1 million).
The recent results of Post Publishing reflect the severe economic
downturn and currency devaluation which continues to affect Thailand.
Awards
The South China Morning Post swept the board in the Newspaper Society of
Hong Kong Press Awards, which were announced on 27 March 1998. Post
writers were judged top in all three English language categories: general story,
business and features, with Charmaine Chan's article “The Great Tourist
Rip-off” winning the overall award for the Best Story of the Year and Best
Feature Story. Post photographers also won first and second prizes in the sports
and news photographic sections.
Post photographers won a further six prizes in the Hong Kong Press
Photographers' Association's Awards held in February 1998, including the Best
Spot News and Best Sports Picture in two of the hotly contested categories for
the Focus at the Frontline competition.
The South China Morning Post won the top award for design, and
Postmagazine, the Sunday Morning Post Magazine, won a top prize in the
magazine or supplement category at the Asian Newspaper Awards in March
1998.
In the 1998 Hong Kong Human Rights Press Awards presented on 13
June, South China Morning Post staff took two top prizes in the newspaper
section and seven awards for their photographs.
TVE
The rental income of TVE, which represents more than two thirds of TVE's net
income remains unaffected by the decline in market rentals.
The operating divisions of TVE - which range over such diverse
businesses as Chinese-language publishing (magazines and books),
convenience store retailing, the operation of kindergartens and recreational
clubs, and record and music publishing - have experienced declines in
profitability as a result of difficult market conditions and more recently the
economic downturn.
Management has taken action to reduce operating and overhead expenses
by sharply rationalizing the management structure of TVE, whilst marginal or
unprofitable businesses have been closed. The planned project to develop an
ice skating rink and commercial building in Shanghai has been terminated due
to the lack of viability in the present economic climate.
Prospects
Hong Kong is likely to continue experiencing economic hardship for the next
year or two. In the face of rising job redundancies and reduced consumer
expenditure, the Company's main sources of advertising revenue will remain
depressed. Newsprint prices are expected to remain as current levels whilst
management will continue to review the cost structure of the Company's
operations and seek further improvements in operating efficiency in order to
mitigate any further contraction in revenues.
Advertisers and Readers

I would like to take this opportunity to thank our loyal readers and advertisers
for supporting us throughout the past year. The South China Morning Post
continues to maintain its leadership in English-language publishing in Hong
Kong as a result of their strong co-operation and support. We will strive to
further improve on the quality and consistency of our newspapers and products
to justify their continued support.
Directors, Management and Staff

I wish to express the Board's deep gratitude for the contributions made to the
Company by three retiring non-executive directors namely, our former
Chairman, Mr. Kuok Hock Nien, Datuk Dr. Cheah Sin Bee and Mr. Ronald J.
McAulay. I would also like to record the Board's appreciation of the retiring
Chief Executive Mr. Lindley J. Holloway, who ably served the Company in
this post from 1990 to his retirement in December 1997; Mr. Holloway still
serves as a Director and adviser to the Company.
Finally, the Board joins me in thanking the Management and staff of the
Group in all of its divisions for their dedication and untiring efforts during the
past year.
Kuok Khoon Ean

Chairman
Hong Kong, 11 September 1998.

South China Morning Post (Holdings) Limited Facing the Future
Facing The Future
Even by Hong Kong’s always lively standards, the 12 months covered by

this report were dramatic.
The South China Morning Post news team was kept at full stretch
keeping the readers informed of the significant, and sometimes traumatic,
events that unfolded during the year.
Post-handover developments, the swearing in of the Provisional
Legislature, the arrival of the world’s most powerful bankers for the World
Bank and International Monetary Fund meetings, the containment of chicken
flu, political and economic developments in China, the extraordinary slide of
Asia’s economies, the local property and stock market slump, and the
determined defence of the peg were just some of the major items on the
news schedules.
The background story, which doesn’t make immediate headlines, is the
re-positioning which must take place in the private sector if the Hong Kong
economy is to maintain its leading role in Asia.
The key to future success is an all-round corporate upgrading.
Efficiency, productivity and quality must all be improved.
The Company, in common with other leading Hong Kong companies
is striving to raise its standards, improve efficiency and prepare for the
future return to growth.
Colour upgrades offer new opportunities

The slow-down in the economy has not deterred the Company from going
ahead with prudent investment in the future. Our previously announced
investment in greater colour printing capability continues, and will provide
new attractions for both readers and advertisers.
Two existing Colorman mono units are to be upgraded to colour,
enabling optimum flexibility in day-to-day operations, as well as enabling
overhauls to be carried out without hampering production.
A new Geoman 4/4 unit with a double folder is also being added, in tandem
with the Colorman line.
This will provide valuable opportunities for special supplements and
regular tabloid sections like Racing Post, Weekend Entertainment, Young
Post, Premier Soccer and Postmagazine to upgrade to full colour - a definite
plus for advertisers and readers.
Award-winning PostNet sets new standards

PostNet, the electronic publishing division of the Company, has established
itself as a clear leader in Internet publishing in Hong Kong. During the year,
the SCMP’s Internet Edition won two prestigious international awards - the
first time a Hong Kong publisher has achieved such a feat. In January, Editor
& Publisher, the American journalists’ bible, voted SCMP the Best Non-US
Newspaper Online Service, and in June the Newspaper Association of
America awarded the SCMP its Digital Edge Outstanding Achievement
award for Best News Presentation.
The Internet is continuing to develop rapidly as a force in the media
and in e-commerce and e-business. As of mid-1998, Hong Kong and China
have more than one million Internet users each. The Hong Kong
Government is determined to make the SAR a leader in information
technology and is undertaking strategic initiatives in both business and
education to promote the Internet as the common communication platform of
the future.
The Company is working with the Financial Secretary’s Business and
Services Promotion Unit to encourage the development of Internet
publishing skills through an SAR-wide Web site design competition.
PostNet is also playing an active role in the development of the
Internet industry being a founding member of the Hong Kong Chapter of the
Internet Advertising Bureau which promotes standards for the placement,
reporting, measurement and understanding of Internet advertising.
Although advertising remains the cornerstone of its Internet business
model, PostNet also offers subscription-based services and provides an
e-commerce platform on which merchants can sell their products and
services. PostNet is continuing to develop products and services for both the
Hong Kong and China markets in order to establish the Company’s position
in this important emerging advertising medium.
PostNet’s other electronic services include CD-ROM publishing, voice
and fax information packages, and the syndication and sale of the South
China Morning Post’s award-winning stories and photographs.
An investment in the future - 25 years of the SCMP Student Awards

Hong Kong’s position as one of the most competitive cities in the world now
firmly rests on the performance of its service industries. Almost 90 per cent
of gross domestic product is generated by the service sector, while
manufacturing contributes less than eight per cent.
In fact, manufacturing still plays a huge role in Hong Kong’s wealth
generating capability, but the factories are now outside the territory, and it is
the key administration services which are located within Hong Kong.
To maintain its position as one of the most productive and efficient
service centres in the world, Hong Kong must strive tirelessly to raise its
standards. This, in turn, means raising the productivity of its workforce.
Only with the highest calibre of personnel will we maintain our
position as one of the most competitive economies in the world.
The most crucial element in this drive for excellence is education. Only
a well-educated, creative workforce will be able to take maximum advantage
of the new concepts and tools which will power the service sector in the next
century.
For 25 years, the SCMP Student of the Year Awards have provided a
practical role in encouraging Hong Kong’s young people in their academic
achievements, and we will continue to seek fresh opportunities to play our
part in improving standards.
The awards provide practical help to deserving students in a variety of
disciplines by offering scholarships to the winners, and are widely
recognised and acknowledged by local schools, teachers and education
authorities as one of the most important events in the school calendar.
The top award, for Student of the Year, typically carries with it a
$50,000 scholarship provided by sponsors arranged by the South China
Morning Post.
Creativity will be essential for Hong Kong’s growing service sector,
and the SCMP Student of the Year Awards recognise the need for an early
development of a wide range of skills. This is why the eight awards cover
the arts, sport, language and computer skills as well as academic
achievement.
Learning English is fun - with SCMP’s

new CD-ROM
If Hong Kong is to retain its position as
Asia’s leading service centre, its
people’s skill in English - the language
of international business - will have to be
continually refined and upgraded.
As the premier English-language
newspaper in the SAR, the South China
Morning Post already makes an
unparalleled contribution to the spread of information in English.
The concern shown by parents, teachers, students and employers over
the Government’s plans for language teaching in schools illustrates how
highly the English language is regarded.
This provides the South China Morning Post with an excellent
opportunity for building circulation, and offers further avenues of
development.
To provide students with an effective and enjoyable method of
improving their English language skills, the Company is to market an
interactive CD-ROM for use at home and in the classroom.
Based on the Chinese Classic “Journey to the West”, the CD will be a
unique tool which will help students improve their general knowledge as
they raise their standard of English.
The CD will be combined with a regular cartoon strip that will appear
in Young Post. This will feature the well-known characters from the story,
and follow their adventures around the world.
By using established newspaper techniques, and the new technology of
CD-ROM, the Company will be making yet another contribution to the

raising of English-language standards in Hong Kong.

Copyright © 1998 South China Morning Post Publishers Ltd. All rights reserved. -->
Five Year Financial Summary
OPERATING RESULTS
Year ended 30 June
1998 1997 1996 1995 1994
HK$'000 HK$'000 HK$'000 HK$'000 HK$'000
Turnover 2,236,313 2,352,450 1,444,105 1,266,130 1,231,085
Operating
Profit before
exceptional
item 800,454 947,810 602,339 692,707 671,167
Exceptional
(256,000) — 180,989 — —
item
________ ________ ________ ________ ________
Operating profit 544,454 947,810 783,328 692,707 671,167
Share of
(losses)/profits
of associated
companies (4,076) 8,792 12,268 9,463 792
________ ________ ________ ________ ________
Profit before
540,378 956,602 795,596 702,170 671,959
taxation
Taxation (128,210) (151,302) (99,722) (122,108) (107,857)
________ ________ ________ ________ ________
Net profit
attributable to 412,168 805,300 695,874 580,062 564,102
shareholders
Retained profits
at beginning of 1,324,926 1,038,926 834,515 704,453 590,351
year
________ ________ ________ ________ ________
1,737,094 1,844,226 1,530,389 1,284,515 1,154,453

Dividends (519,300) (519,300) (491,463) (450,000) (450,000)
________ ________ ________ ________ ________
Retained profits 1,217,794 1,324,926 1,038,926 834,515 704,453
at end of year
ASSETS AND LIABILITIES

As at 30 June
1998 1997 1996 1995 1994
HK$'000 HK$'000 HK$'000 HK$'000 HK$'000
Publishing titles 1,820,000 1,820,000 1,820,000 1,820,000 1,820,000

Fixed assets 1,898,128 2,012,177 1,854,295 969,530 1,057,245
Interests in
associated 61,232 84,262 85,595 71,349 2,571
companies
Long term
211,073 125,808 12,666 — 285,588
investments
Loans to a
— — — — 5,077
related company
Current assets 832,896 1,385,381 1,096,056 610,156 417,398

Current liabilities (714,660) (984,874) (935,001) (642,200) (438,069)
________ ________ ________ ________ ________
Net current
118,236 400,507 161,055 32,044 20,671
assets/(liabilities)
Long term
secured bank (49,172) (67,977) (19,400) — —
loans
Deposit received — — — — (100,000)
Deferred taxation (82,244) (62,304) (62,384) (56,250) (39,688)
________ ________ ________ ________ ________
Net assets 3,977,253 4,312,473 3,851,827 2,772,585 3,010,122
The above summaries of operating results and net assets include the results of the
Company, its subsidiaries and associated companies and the assets and liabilities of
the Company and its subsidiaries for the five years ended 30 June 1998.
South China Morning Post (Holdings) Limited Report of the Directors
Report of The Directors
page: 1 2 3
The Directors have pleasure in submitting their report together with the
audited financial statements of the Company and the Group for the year ended
30 June 1998.
Principal activities
The Company acted as an investment holding company during the year. The
principal activities of the Group during the year have not changed and
consisted of the publishing, printing and distribution of the South China
Morning Post, South China Sunday Morning Post and other publications, the
provision of entertainment, recreation and leisure services, retailing,
production of commercial films and holding of properties for rental income
purposes.
Segmented information
All the activities of the Group are based in Hong Kong and below is an
analysis of the Group's turnover and contribution to operating profit by
activity.
Turnover Contribution
HK$'000 HK$'000
Publishing, printing and
distribution of newspapers
and other publications 1,574,326 729,608
Provision of entertainment,
recreation and leisure 181,996 (33,968)
services
Retailing 352,234 20,926
Production of commercial
42,895 303
films
Holding of properties for
84,862 83,585
rental income
________ ________
Total 2,236,313 800,454
Major suppliers and customers

In the year under review, the Group purchased less than 30% of its goods from
its five largest suppliers. Sales to the five largest customers also accounted for
less than 30% of the total sales for the year.
As far as the Directors are aware, neither the Directors, their associates, nor
those shareholders which own more than 5% of the Company's share capital
had any interest in the five largest suppliers and customers.
Major suppliers and customers

In the year under review, the Group purchased less than 30% of its goods from
its five largest suppliers. Sales to the five largest customers also accounted for
less than 30% of the total sales for the year.
As far as the Directors are aware, neither the Directors, their associates, nor
those shareholders which own more than 5% of the Company's share capital
had any interest in the five largest suppliers and customers.
Financial results
The profit of the Group for the year ended 30 June 1998 and the state of affairs
of the Company and the Group as at that date are set out in the financial
statements on pages 39 to 68.
Dividends
During the year, an interim dividend of 15 cents per share was paid. The
Directors recommend the payment of a final dividend of 15 cents per share in
respect of the year ended 30 June 1998 to the shareholders whose names
appear on the register of members of the Company on Friday, 30 October
1998. The financial statements have incorporated this recommendation.
Five year financial summary

The summary of the results and of the assets and liabilities of the Group for
each of the five years ended 30 June 1998 is set out on page 26.
Fixed assets
Movements in the fixed assets of the Group are disclosed in note 11 to the
financial statements.
Subsidiaries
Particulars of the Company's principal subsidiaries at 30 June 1998 are set out
in notes 12 and 25 to the financial statements.
Bank loans
Particulars of bank loans of the Group at the balance sheet date are set out in
note 17 to the financial statements.
Share capital
Details of the authorised and issued share capital of the Company are set out in
note 19 to the financial statements.
There are no provisions for pre-emptive rights under the Company's Bye-laws
or the laws in Bermuda which would oblige the Company to offer new shares
on a pro rata basis to existing shareholders.
Reserves
Movements in the reserves of the Company and the Group during the year are
set out in note 20 to the financial statements.
Charitable donations
During the year, the Group made charitable donations totalling HK$620,000.
Directors
The following persons were Directors of the Company during the year:
Mr.Kuok Khoon Ean Chairman

Mr. Roberto V. Ongpin Deputy Chairman
Mr. Owen R. Jonathan Chief Executive
Mr. Rayner Cheung Yun Kwun Executive Director
The Hon. Ronald J. Arculli
Mr. Paul J. C. Bush
The Rt. Hon. Sir Percy Cradock
Mr. Lindley J. Holloway
Tan Sri Dr. Khoo Kay Peng
Mr. Kuok Khoon Ho
Dr. The Hon. David Li Kwok Po
Mr. Kuok Hock Nien (resigned as Chairman and Director
on 31 December 1997)
Datuk Dr. Cheah Sin Bee (resigned on 20 April 1998)
Mr. Ronald J. McAulay (resigned on 30 June 1998)
Subsequent to the Company’s balance sheet date, Mr. Peter Lee Ting Chang
has been appointed an Independent Non-executive Director of the Company
on 28 August 1998.
In accordance with the Company's Bye-laws, Messrs. Paul J.C. Bush, Kuok
Khoon Ho, Owen R. Jonathan, Lindley J. Holloway and Peter Lee Ting Chang
retire and, being eligible, offer themselves for re-election.
Back to Top
page: 1 2 3


page: 1 2 3
Brief biography of Directors and senior management
Non-executive Directors
Mr. Kuok Khoon Ean, aged 43, joined the Board in October 1993 and was
appointed Chairman on 1 January 1998. Mr. Kuok holds Directorships in the
statutory boards of Sentosa Development Corporation and the Singapore
Trade Development Board. He is also a Director of a number of public listed
companies in Singapore and Malaysia. He is a Director of Kerry Group
Limited and Kerry Media Limited which are substantial shareholders of the
Company. He is a cousin of Mr. Kuok Khoon Ho, a Director of the Company.
Mr. Roberto V. Ongpin, aged 61, joined the Board in October 1993 and was
appointed Deputy Chairman in the same year. He is Vice Chairman of AIA
Capital Corporation Limited, the American International Group's flagship
investment bank in the Asian region. Prior to 1979, he was Chairman and
Managing Partner of the SGV Group, one of the largest accounting and
consulting firms in Asia. He has an MBA from Harvard Business School and
is a Certified Public Accountant.
The Hon. Ronald J. Arculli, JP, aged 59, joined the Board in June 1996. Mr.
Arculli is a practising solicitor and an elected member of the Legislative
Council. Mr. Arculli has served on the Legislative Council and the Provisional
Legislative Council since 1988. Since 1991, he has represented the Real Estate
and Construction functional constituency. He has served, and continues to
serve, on numerous government committees and advisory bodies. Mr. Arculli
is also a Director of several public listed companies in Hong Kong.
Mr. Paul J. C. Bush, aged 67, was appointed a Director of the Company in
October 1993. He is a Chartered Accountant (Australia) and was formerly a
partner with Coopers & Lybrand, Sydney, Australia. After retirement from the
firm in 1980, he became a financial adviser and Director of a number of
Australian and overseas companies. In 1991, he joined the Kuok Group in
Hong Kong as Group Adviser and is a Director of a number of companies
within the Kuok Group, including Shangri-La Asia Limited and Kerry
Properties Limited.
The Rt. Hon. Sir Percy Cradock, G.C.M.G., aged 74, was appointed a
Director of the Company in June 1996. He joined the British Foreign Office in
1954 and served as Counsellor, then Charge d' Affairs in Peking from 1966 to
1969 and later as Head of the Assessments Staff in the Cabinet Office. From
1978 to 1984 he was Ambassador in Peking, where he opened and led the
negotiations on the Hong Kong Joint Declaration. From 1984 to 1992 he was
the Prime Minister's Foreign Policy Adviser. Sir Percy retired from
government service in 1992. He is an Honorary Fellow of St. John's College,
Cambridge and was made a Privy Councillor in 1993.
Mr. Lindley J. Holloway, aged 69, was first associated with the Group in
1987 and became the Chief Executive and a Director in 1990. Mr. Holloway
began his career in the newspaper industry in 1961, when he joined Straits
Times Press Limited in Singapore and Malaysia. He held the position of Chief
Executive of the Singapore Press Holdings Limited for 12 years and left in
1986 to join The News Corporation in London. On 31 December 1997, he
retired as Chief Executive, but remains on the Board and with the Group as
Adviser.
Tan Sri Dr. Khoo Kay Peng, aged 59, joined the Board in June 1994, is the
Chairman and Group Chief Executive of the MUI Group of companies. The
MUI Group is a diversified conglomerate with interests in the Asia Pacific,
Australia , the United States of America and the United Kingdom. Previously,
Tan Sri Khoo had served as the Director of Banking Operations in Bank
Bumiputra Malaysia Berhad and as Vice Chairman of Malayan Banking
Berhad. Currently he is a trustee of Malaysian Humanitarian Foundation and
Regent University, Virginia, U.S.A.
Mr. Kuok Khoon Ho, aged 48, was appointed a Director of the Company in
April 1996. He is a Director of Television Broadcasts Limited and Kerry
Group Limited which is a substantial shareholder of the Company.
Mr. Peter Lee Ting Chang, JP, aged 44, joined the Board in August 1998.
Mr. Lee is a civil engineering graduate of the University of Manchester and
was also admitted as a Solicitor of the Supreme Court in England and Wales.
He is a Director of Lee Hysan Estate Co. Ltd. and Hysan Development Co.
Ltd. Mr. Lee is also a member of the Government’s Central Policy Unit.
Dr. The Hon. David Li Kwok Po, OBE, JP, aged 59, was appointed to the
Board in April 1990. Dr. Li is Chairman and Chief Executive of The Bank of
East Asia, Limited and Director of numerous other companies in Hong Kong
and overseas. He is an elected member of the Legislative Council,
representing the Finance Constituency. He is also a member of the Hong Kong
Banking Advisory Committee, the Exchange Fund Advisory Committee and
the Land Fund Advisory Committee.
Mr. Ronald J. McAulay, M.A., C.A., aged 62, a graduate of the University of
Glasgow, a member of the Institute of Chartered Accountants of Scotland, was
appointed to the Board in April 1990 until he retired on 30 June 1998. Mr.
McAulay is also a Director of Kadoorie McAulay Limited as well as a number

of Hong Kong listed companies including China Light & Power Company,
Limited and The Hongkong and Shanghai Hotels, Limited.
Executive Directors
Mr. Owen R. Jonathan, aged 46, joined the Board in September 1994 as
Deputy Chief Executive. He became the Chief Executive on 1 January 1998 .
Mr. Jonathan is a law graduate of Bristol University. He joined Norton Rose, a
firm of City of London solicitors in 1974 where he was a partner from 1983 to
1994.
Mr. Rayner Cheung Yun Kwun, aged 34, was appointed to the Board as
Executive Director in November 1996. Prior to joining the Group, Mr. Cheung
held various positions in finance and investment in the United States of
America and Hong Kong. Mr. Cheung is a graduate of Princeton University
and holds a doctorate in economics and a law degree from Stanford
University.
Directors' remuneration
HK$'000
Fees :
Executive —
Non-Executive 2,641
Other emoluments:
Salaries, allowances and benefits in kind 11,321
Pension scheme contributions 543
Bonuses paid and payable 6,287
20,792
The remuneration of the above Directors fell within the following bands :
Number of Directors
HK$ Nil - HK$ 1,000,000 11
HK$ 2,500,001 - HK$ 3,000,000 1
HK$ 7,000,001 - HK$ 7,500,000 1
HK$ 9,500,001 - HK$ 10,000,000 1
14
There were no arrangements under which a Director had waived or agreed to

waive any remuneration in respect of the year ended 30 June 1998.
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page: 1 2 3
Five highest paid employees

The five highest paid employees during the year included two Directors,
details of whose remuneration are set out above. The details of the
remuneration of the remaining three highest paid employees are set out below.
HK$'000
Salaries, allowances and benefits in kind 6,990
Pension scheme contributions 267
Bonuses paid and payable 1,862
9,119
The remuneration of the three highest paid employees fell within the
following bands
Number of employees
HK$2,500,001 - HK$3,000,000 2
HK$3,500,001 - HK$4,000,000 1
3
Directors' interests in shares

(1) Ordinary shares
At 30 June 1998, the interests of the Directors in the shares of the Company
and its associated corporations as recorded in the register maintained by the
Company pursuant to Section 29 of the Securities (Disclosure of Interests)
Ordinance ("SDI Ordinance") were as set out below.
Number of ordinary shares

Personal Corporate and
Name of Directors interests other interests Total
Mr. Lindley J. Holloway 1,200,000 Nil 1,200,000
Tan Sri Dr. Khoo Kay Peng Nil 140,898,000 140,898,000
Dr. The Hon. David Li
Kwok Po 100,000 Nil 100,000
(2) Share options

At 30 June 1998, the following particulars were recorded by the Company in
the register maintained pursuant to Section 29 of the SDI Ordinance pertaining
to the grant ("Grant") by the Company at nil cash consideration to the
directors of share options ("Options") to subscribe for ordinary shares of the
Company pursuant to the approved Employee Share Option Scheme adopted
on 5 June 1990.
Number
of shares
involved Subscription
Name of Date of in the Period during which price per
Directors Grant Option exercisable share HK$
Mr. Owen 17/02/1997 500,000 6.37
R. Jonathan 17/02/1998-29/06/2000
Mr. Rayner 17/02/1997 350,000 6.37
Cheung
Yun Kwun 17/02/1998-29/06/2000
Mr. Lindley 17/02/1997 1,000,000 17/02/1998-31/12/1999 6.37
J. Holloway
Save as disclosed herein, during the year, none of the Directors of the
Company and their respective spouses and children under 18 years of age had
been granted by the Company or had exercised any rights to subscribe for an
equity or debt securities of the Company or any of its associated corporations.
Save as stated above, none of the Directors had any interest in the equity or
debt securities of the Company and its associated corporations at 30 June
1998.
Substantial shareholders
At 30 June 1998, the Company had been notified of the following interests by
shareholders in shares representing ten per cent or more of the issued share
capital of the Company which were recorded in the register required to be kept
under S.16(1) of the SDI Ordinance:
Name of shareholder Number of ordinary shares

Kerry Group Limited 592,656,000
Kerry Media Limited 523,510,000
Franklin Resources, Inc. 193,546,600
Templeton Worldwide, Inc. 193,546,600
Included in the 592,656,000 shares in the Company held by Kerry Group

Limited are 523,510,000 shares held by Kerry Media Limited.
The interests in the 193,546,600 shares in the Company held by Templeton

Worldwide, Inc., a wholly-owned subsidiary of Franklin Resources, Inc., are
the same shareholdings referred to the above reported for Franklin Resources,
Inc.
Directors' interests in contracts

None of the Directors had a material beneficial interest in any contracts of
significance to which the Company or any of its subsidiary companies was a
party during the year.
Management contracts
Save for Mr. Lindley J. Holloway who had entered into a consultancy
agreement with the Company for a term of two years commencing 1 January
1998, no Director proposed to be elected or re-elected at the forthcoming
Annual General Meeting has a service contract with the Company which is not
determinable by the Company within one year without payment of
compensation other than by statutory obligation.
Directors' arrangements to acquire shares or debentures

Save as disclosed herein, at no time during the year was the Company or any
of its subsidiary companies a party to any arrangement to enable the
Company's Directors or their associates to acquire benefits by means of the
acquisition of shares in or debentures of the Company or any other body
corporate.
Purchase, redemption or sale of the Company's shares

Neither the Company nor any of its subsidiary companies purchased,
redeemed or sold any of the Company's shares during the year.
Code of best practice

In the opinion of the Directors, other than in regard to the appointment of the
Independent Non-executive Directors, the Company has complied with the
Code of best practice as set out in Appendix 14 to the Rules Governing the
Listing of Securities on The Stock Exchange of Hong Kong Limited
throughout the accounting period covered by the annual report.
Save for one Director, the other Independent Non-executive Directors are not
appointed for a specific term as they are subject to retirement by rotation and
re-election at the Annual General Meeting in accordance with the Bye-laws of
the Company.
The Year 2000

The Company is addressing the Year 2000 (“Y2K”) issues and has established
a special taskforce to tackle the challenge. Y2K compliant means being
capable of correctly processing, providing and/or receiving date data before,
during and after the 1999-2000 date transition. An overall Y2K budget of
HK$31 million has been established and has a completion target date of third
quarter, 1999. The Company’s strategy is to treat the Y2K issue essentially as
a risk management exercise. All systems, components, interfaces, inputs and
outputs which are potentially Y2K-impacted have been identified. These have
been assigned a priority based on how critical they are to the business of the
Company and its day-to-day operations. Two other important factors which
have determined priority are time-to-completion and the resources required.
Where Y2K fixes require scarce resources or lengthy periods of time to
implement, the earliest possible start/completion dates have been scheduled.
The over-riding goal is to ensure that the business will be able to operate
normally prior to, through and beyond 1 January 2000.
The Company established an enterprise-wide Y2K project group

(inter-department) in 1996. In March 1998, a Y2K Project Manager was
appointed to drive implementation. A company-wide audit was completed to
identify all Y2K-related issues. These have been prioritized according to their
importance to the business in terms of both critical day-to-day operations as
well as the complexity of the Y2K problem and the time needed to address it.
Typical responses to Y2K problems include system replacement; re-coding (or
conversion of source code); software fixes or patches; hardware/software
upgrades; and “work-arounds”. With most of the Company’s Y2K issues,
there is an obvious single best solution. In a few cases there are alternative
solutions and these are currently being evaluated against operational
requirements, cost and level of risk exposure.
The Y2K Project has been sub-divided into a number of separate and largely
independent sub-projects, each with it’s own budget, schedule and deadlines.
In each case, appropriate external experts/contractors have been identified and
engaged to apply Y2K fixes. Project schedules, milestones and deadlines have
been determined. Reporting processes have been agreed and the Y2K Project
Manager co-ordinates all sub-projects. In other cases, system replacement or
upgrade has been determined to be the best solution. Requests for proposals
have been issued to vendors; systems have been evaluated; and some orders
have been placed. Some components have already been installed and others
have been scheduled for phased installation. Different sub-projects are at
different stages. Some are at the re-coding stage, some are at the testing stage,
and others are at system replacement stage. All sub-projects are on schedule
and within budget. At this stage it is reasonable to expect all projects to be
completed on time.
For the year ended 30 June 1998, the Group has spent some HK$4 million in
replacing systems with upgraded versions, the vendors of which have

represented them as being Y2K compliant. The cost of these new assets has
been capitalized in the accounts. As at 30 June 1998, HK$5 million had been
contracted but not provided for in the accounts for the year ended on that date,
and the balance of HK$22 million has been authorized but not contracted for
in respect of the Company’s Y2K programme.
Auditors
Ernst & Young retire and a resolution for their reappointment as auditors of
the Company will be proposed at the forthcoming Annual General Meeting.
By order of the Board
Kuok Khoon Ean

Chairman
Hong Kong, 11 September 1998
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page: 1 2 3

South China Morning Post (Holdings) Limited Audited financial Statements
Audited Financial Statements
page: 1 2
Consolidated: •Profit And Loss Account Company: •Balance Sheet

•Balance Sheet
•Cash Flow Statement
Consolidated Profit and Loss Account

Year ended 30 June 1998
1998 1997
Notes HK$'000 HK$'000
TURNOVER 2 2,236,313 2,352,450
OPERATING PROFIT BEFORE

EXCEPTIONAL ITEM 3 800,454 947,810
Exceptional item 4 (256,000) ——
OPERATING PROFIT 544,454 947,810
Share of (losses)/profits of
(4,076) 8,792
associated companies
PROFIT BEFORE TAXATION 540,378 956,602
Taxation 6 (128,210) (151,302)
NET PROFIT ATTRIBUTABLE
TO SHAREHOLDERS 7 412,168 805,300
Retained profits at beginning of year 1,324,926 1,038,926
1,737,094 1,844,226
Dividends 8 (519,300) (519,300)
RETAINED PROFITS AT END 1,217,794 1,324,926
20
OF YEAR
EARNINGS PER SHARE 9

Basic 23.81 cents 46.52 cents
Excluding exceptional item 38.60 cents 46.52 cents
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Consolidated Balance Sheet

30 June 1998
1998 1997
PUBLISHING TITLES 10 1,820,000 1,820,000
FIXED ASSETS 11 1,898,128 2,012,177
INTERESTS IN ASSOCIATED
13 61,232 84,262
COMPANIES
LONG TERM INVESTMENTS 14 211,073 125,808
CURRENT ASSETS
Prepayments, deposits and other
76,236 141,627
receivables
Inventories 15 46,088 41,390
Accounts receivable 243,474 350,513
Short term investments 16 — 376,703
Bank balances and deposits 467,098 475,148
832,896 1,385,381
CURRENT LIABILITIES
Bank overdrafts — 6,302
Bank loans, secured 17 18,805 342,205
Accounts payable and accrued
271,679 256,084
liabilities
Subscriptions in advance 9,635 9,005
Proposed final dividend 8 259,650 225,030
Taxation 154,891 146,248
714,660 984,874
NET CURRENT ASSETS 118,236 400,507
TOTAL ASSETS LESS
4,108,669 4,442,754
CURRENT LIABILITIES
LONG TERM LIABILITIES
Bank loans, secured 17 (49,172) (67,977)
Deferred taxation 18 (82,244) (62,304)
(131,416) (130,281)
3,977,253 4,312,473
SHAREHOLDERS' EQUITY
Share capital 19 173,100 173,100
Reserves 20 3,804,153 4,139,373
3,977,253 4,312,473
Kuok Khoon Ean Owen R. Jonathan

Chairman Director and Chief Executive
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page: 1 2

South China Morning Post (Holdings) Audited Financial statements
Audited Financial Statements
page: 1 2
Consolidated: •Profit And Loss Account Company: •Balance Sheet

•Balance Sheet
•Cash Flow Statement
Consolidated Cash Flow Statement

Year ended 30 June 1998
1998 1997
Note HK$'000 HK$'000
NET CASH INFLOW FROM
OPERATING ACTIVITIES 23(a) 936,582 809,867
RETURNS ON INVESTMENTS
AND SERVICING OF FINANCE
Interest received 51,861 51,792
Net rental income from investment
81,522 76,578
properties received
Dividends received from:
Associated company —— 6,609
Listed investments 11,066 3,007
Interest paid (28,029) (33,158)
Dividends paid (484,680) (519,300)
Net cash outflow from returns on
investments and servicing of
(368,260) (414,472)
finance
TAXATION
Hong Kong profits tax paid (99,627) (119,138)
INVESTING ACTIVITIES
Purchase of subsidiaries —— (4,636)
Additions to fixed assets (163,747) (66,146)
Purchases of long term
(313,983) (113,142)
investments
Purchases of short term

—— (98,473)
investments
Purchase of interests in associated
(7,254) (721)
companies
Proceeds from disposals of fixed
4,754 7,405
assets
Proceeds from disposals of short
term 351,992 106,967
investments
Proceeds from disposal of an
—— 6,000
associated company
Net cash outflow from investing
(128,238) (162,746)
activities
NET CASH INFLOW BEFORE

FINANCING ACTIVITIES 340,457 113,511
FINANCING ACTIVITIES 23(b)

Repayment of bank loans (342,205) (341,400)
Bank loans raised —— 390,782
Net cash inflow / (outflow) from
(342,205) 49,382
financing activities
INCREASE / (DECREASE) IN
CASH AND CASH (1,748) 162,893
EQUIVALENTS
Cash and cash equivalents at
468,846 305,953
beginning of year
CASH AND CASH

EQUIVALENTS AT END OF 467,098 468,846
YEAR
ANALYSIS OF BALANCES OF CASH

AND CASH EQUIVALENTS
Bank balances and deposits 467,098 475,148
Bank overdrafts —— (6,302)
467,098 468,846
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Balance Sheet
30 June 1998
1998 1997
INTERESTS IN
12 3,647,010 3,647,010
SUBSIDIARIES
CURRENT ASSETS
Dividends receivable from
259,650 225,030
subsidiaries
CURRENT LIABILITIES
Proposed final dividend 8 259,650 225,030
NET CURRENT ASSETS —— ——

3,647,010 3,647,010
SHAREHOLDERS' EQUITY
Share capital 19 173,100 173,100
Reserves 20 3,473,910 3,473,910
3,647,010 3,647,010
Kuok Khoon Ean Owen R. Jonathan

Chairman Director and Chief Executive
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page: 1 2

South China Morning Post (Holdings) Limited Notes to Financial statements
Notes to Financial Statements
page: 1 2 3 4 5 6 7
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of accounting
These financial statements have been prepared in accordance with
accounting principles generally accepted in Hong Kong and the disclosure
requirements of the Hong Kong Companies Ordinance.
Basis of consolidation
The consolidated financial statements include the financial statements of
the Company and its subsidiaries for the year ended 30 June 1998. As
some of the subsidiaries of TVE (Holdings) Limited have a financial year
ending on 31 December 1998, consolidated financial statements have been
prepared based on the audited interim accounts of these subsidiaries to 30
June 1998. The results of subsidiaries acquired or disposed of during the
year are consolidated from or to their effective dates of acquisition or
disposal, respectively. All significant intercompany transactions and
balances have been eliminated on consolidation.
Revenue recognition
Revenue is recognised when it is probable that the economic benefits will
flow to the Group and when the revenue can be measured reliably, on the
following bases:
(a) on sale of goods, when the significant risks and rewards of ownership
have been transferred to the buyer;
(b) newspaper advertisements and other services, based on the period in
which such services are rendered;
(c) rental income, in the period in which the properties are let out and on
the straight-line basis over the lease terms; and
(d) interest income, on a time proportion basis taking into account the
principal outstanding and the effective interest rate applicable.
Inventories
Inventories are stated at the lower of cost and net realisable value after
making due allowance for any obsolete or slow-moving items. Cost of
inventories except printing materials which is stated at weighted average

cost, is determined on the first-in, first-out basis and, in the case of work in
progress and finished goods, comprises direct materials, direct labour and
an appropriate proportion of overheads.
Net realisable value is based on estimated selling prices less further costs
expected to be incurred to completion and disposal.
Subsidiaries
A subsidiary is a company in which the Company, directly or indirectly,
controls more than half of its voting power or issued share capital or
controls the composition of its board of directors.
Interests in subsidiaries in the Company's balance sheet are stated at cost

unless, in the opinion of the Directors, there has been a permanent
diminution in value, when they are written down to Directors' valuation.
Associated companies
An associated company is a company, not being a subsidiary, in which a
long term equity interest is held and over which the Group is in a position
to exercise significant influence.
The Group's share of the post-acquisition results and reserves of associated

companies is included in the consolidated profit and loss account and
consolidated reserves, respectively. The Group's interest in associated
companies is stated in the consolidated balance sheet at the Group's share
of net assets of the associated companies under the equity method of
accounting less any provisions for permanent diminutions in values
deemed necessary by the directors.
Goodwill
Goodwill arising on consolidation of subsidiaries and on acquisition of
associated companies represents the excess of purchase consideration paid
over the fair values ascribed to the net underlying assets acquired and is
eliminated against reserves in the year of acquisition.
Upon the disposal of such subsidiaries or associated companies, the

relevant portion of attributable goodwill previously eliminated against
reserves is realised and accounted for in arriving at the gain or loss on
disposal.
Fixed assets and depreciation

Fixed assets, other than investment properties, are stated at cost or
valuation less accumulated depreciation. The cost of an asset comprises its
purchase price and any directly attributable costs of bringing the asset to its
working condition and location for its intended use. Expenditures incurred
after the tangible fixed assets have been put into operation, such as repairs
and maintenance costs, are normally charged to the profit and loss account
in the period in which they are incurred. In situations where it can be
clearly demonstrated that the expenditure has resulted in an increase in the
future economic benefits expected to be obtained from the use of the asset,
the expenditure is capitalised as an additional cost of the asset.
Surpluses arising from the revaluation of fixed assets are dealt with in the
asset revaluation reserve. Revaluation deficits are charged to the profit and
loss account to the extent that they exceed surplus arising previously on the
individual assets. A subsequent revaluation increase is recognised as
income to the extent that it reverses a revaluation deficit of the same asset
previously charged to the profit and loss account.
Depreciation is provided on the straight-line method over the following

estimated useful lives:
Land Over the lease term

Buildings 40 to 50 years
Other fixed assets 2 to 20 years
No amortisation is provided for property under construction.
The gain or loss on disposal of a fixed asset is the difference between the
net sales proceeds and the carrying amount of the relevant asset, and is
recognised in the profit and loss account. The revaluation reserve for the
disposed asset is released to retained profits.
Investment properties
Investment properties are interests in land and buildings in respect of
which construction work and development have been completed and which
are intended to be held on a long term basis for their investment potential.
Investment properties held under leases with unexpired periods of 20 years

or less are depreciated over the unexpired terms of the leases.
Investment properties held under leases with unexpired periods greater

than 20 years are stated at open market values on the basis of annual
professional valuations. The surplus on valuations is credited to the
investment property revaluation reserve while any deficit is first set off
against the balance in the reserve on a portfolio basis and thereafter
charged to the profit and loss account.
Upon the disposal of an investment property, the relevant portion of the

investment property revaluation reserve realised in respect of previous
valuations is released to the profit and loss account.
Publishing titles
Publishing titles are stated at cost. No amortisation is provided for in the
financial statements since, in the opinion of the Directors, they do not have
finite useful economic lives.
Investments
Long term investments are stated at cost less any provisions for any
permanent diminution in values deemed necessary by the Directors, on an
individual investment basis.
Short term investments are stated at lower of cost and market value on
individual basis.
Deferred taxation
Deferred taxation is provided, using the liability method, on all significant
timing differences to the extent it is probable that the liability will
crystallise in the foreseeable future. A deferred tax asset is not recognised
until its realisation is assured beyond reasonable doubt.
Foreign currencies
The Group’s financial records are maintained and the financial statements
are stated in Hong Kong dollars.
Transactions involving foreign currencies are translated at the applicable

market rates of exchange ruling at the transaction dates. Monetary assets
and liabilities denominated in foreign currencies at the balance sheet date
are translated at the applicable market rates of exchange ruling at that date.
Exchange differences are dealt with in the profit and loss account.
On consolidation, the financial statements of subsidiaries and associated

companies denominated in foreign currencies are translated into Hong
Kong dollars for inclusion in the Group's financial statements using the
closing rate method. The resultant translation differences are dealt with in
the translation reserve.
Operating leases
Leases where substantially all the rewards and risks of ownership of assets
remain with the leasing company are accounted for as operating leases.
Rentals applicable to such operating leases are charged to the profit and
loss account on the straight-line basis over the lease terms.
Pension costs
The Group operates a defined benefit pension scheme and a defined
contribution pension scheme for its employees, the assets of which are held
separately from those of the Group in two independently administered

funds.
Contributions of the defined benefit pension scheme are made based on the
periodic recommendations of independent actuaries and are charged to the
profit and loss account so as to charge the cost of the pension benefits over
the eligible employees' working lives within the Group. The basic pension
cost is attributed to individual years using the aggregate cost method. The
actuarial basis used includes investment return, salary escalation rates,
withdrawal rates and mortality rates.
Contributions of the defined contribution scheme are charged to the profit

and loss account as incurred and may be reduced by contributions forfeited
by employees who leave the scheme prior to vesting fully in the
contributions.
Cash equivalents
Cash equivalents represents short term highly liquid investments which are
readily convertible into known amounts of cash and which were within
three months of maturity when acquired, less advances from banks
repayable within three months from the date of the advance.
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South China Morning Post (Holdings) Limited Notes to Financial Statements
page: 1 2 3 4 5 6 7
2. TURNOVER
Turnover comprises the aggregate of advertising, circulation and distribution

income of newspapers and other publications, the net invoiced amount in
respect of goods sold and services rendered and gross rental income.
The Group's turnover for the year is as follows :

1998 1997
HK$'000 HK$'000
Publishing, printing and
distribution of
newspapers and other
1,574,326 1,692,667
publications
Provision of entertainment,
181,996 218,069
recreation and leisure services
Retailing 352,234 318,628
Production of commercial
42,895 42,787
films
Gross rental income 84,862 80,299
2,236,313 2,352,450
3. OPERATING PROFIT BEFORE EXCEPTIONAL ITEM
Operating profit before exceptional item is determined after charging :

Group
1998 1997
HK$'000 HK$'000
Depreciation 82,450 76,427
Operating lease rentals on land and
83,814 75,078
buildings
Auditors' remuneration:
Current year provision 2,108 1,828
Prior year underprovision 120 __
Interest on bank loan wholly repayable

28,029 33,158
within five years
Pension scheme costs 20,050 17,941

Less: forfeiture (2,395) (2,127)
17,655 15,814
and after crediting:
Gross rental income from investment
81,771 76,824
properties
Less: outgoings (249) (246)
81,522 76,578
Dividend income from listed
11,066 3,007
investments
Net rental income from leasehold land
3,109 3,475
and buildings
Interest income 51,861 51,792
There were no forfeited pension scheme contributions available at the current

and prior year end to reduce contributions in future years.
4. EXCEPTIONAL ITEM
The exceptional item represents a provision made for diminution in value of

long term investments by marking all listed shares investments down to their
market value as at 26 June 1998.
5. DIRECTORS' REMUNERATION
Group
1998 1997
HK$'000 HK$'000
Fees 2,641 1,047
Other emoluments 18,151 15,359
20,792 16,406
6. TAXATION
Taxation in the profit and loss account is analysed as follows :

Group
1998 1997
HK$'000 HK$'000
Company and subsidiaries:
Provision for the year 108,270 147,735
Deferred taxation (note 18) 19,940 (80)
128,210 147,655
Associated companies:
Hong Kong __ (15)
Elsewhere — 3,662
— 3,647
128,210 151,302
Hong Kong profits tax has been provided for at the rate of 16% (1997: 16.5%)
on the assessable profits generated during the year. Taxes on profits assessable
elsewhere have been calculated at the rates of taxation prevailing in the
countries in which the Group operates.
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page: 1 2 3 4 5 6 7
7. NET PROFIT ATTRIBUTABLE TO SHAREHOLDERS
Included in the net profit attributable to shareholders of South China Morning

Post (Holdings) Limited of HK$412,168,000 (1997: HK$805,300,000) is
HK$519,300,000 (1997: HK$519,300,000), representing dividends from
subsidiaries, which is dealt with in the Company's own accounts.
A loss of HK$4,076,000 (1997: a loss of HK$1,464,000) has been sustained

by the associated companies during the year.
8. DIVIDENDS
Group and Company

1998 1997
HK$'000 HK$'000
Interim dividends paid totalling
15 cents 259,650 294,270
(1997: 17 cents) per share
Proposed final dividend of 15
cents 259,650 225,030
(1997: 13 cents) per share
519,300 519,300
9. EARNINGS PER SHARE
The calculation of basic earnings per share is based on the net profit
attributable to shareholders of HK$412,168,000 (1997: HK$805,300,000) and
1,730,999,996 (1997: 1,730,999,996) shares in issue during the year. If the
exceptional item is excluded, the earnings per share excluding exceptional
item is 38.60 cents (1997: 46.52 cents) which is based on the net profit
attributable to shareholders excluding exceptional item of HK$668,168,000
(1997:HK$805,300,000) and 1,730,999,996 (1997:1,730,999,996) shares in
issue during the year. It is considered that the additional disclosure of earnings
per share excluding exceptional item allows better appreciation of the
operating results of the Group.
The diluted earnings per share is not shown as the impact for the current year
is anti-dilutive and that for the prior year was not material.
10. PUBLISHING TITLES
Group
1998 1997
HK$'000 HK$'000
Cost at beginning and at end of 1,820,000 1,820,000
year
American Appraisal Hong Kong Limited, an independent valuer, valued two

of the Group's publishing titles, South China Morning Post and South China
Sunday Morning Post as at 31 December 1995 on an open market basis at
HK$7.62 billion. This valuation has not been incorporated in the financial
statements.
On the basis of the above, the publishing titles are stated at cost and no
amortisation is provided for in the financial statements.
11. FIXED ASSETS
Group
Leasehold Property Other
Investment land and under fixed
properties buildings construction assets Total
HK$'000 HK$'000 HK$'000 HK$'000 HK$'000
Cost or valuation:
At beginning
of year 1,037,000 539,912 1,930 670,378 2,249,220
Additions — 1,731 90,721 71,295 163,747
Transfers — — (97) 97 —
Disposals — — — (32,790) (32,790)
Revaluation
deficit (note
20) (189,000) — — — (189,000)
At 30 June
1998 848,000 541,643 92,554 708,980 2,191,177
Accumulated depreciation:
At beginning
of year — 20,481 — 216,562 237,043
Provided
during the
year — 9,096 — 73,354 82,450
Disposals — — — (26,444) (26,444)
At 30 June
1998 — 29,577 — 263,472 293,049
Net book value:

At 30 June
1998 848,000 512,066 92,554 445,508 1,898,128
At 30 June
1997 1,037,000 519,431 1,930 453,816 2,012,177
Analysis of cost and valuation:

At cost — 508,643 92,554 708,980 1,310,177
At valuation-
1990 — 33,000 — — 33,000
At valuation-
1998 848,000 — — — 848,000
848,000 541,643 92,554 708,980 2,191,177
Leasehold land and buildings with a net book value of HK$41,407,000 (1997:
HK$42,615,000) were pledged to secure bank loans of HK$24,977,000 (1997:
HK$27,182,000) granted to the Group.
Certain of the Group's leasehold land and buildings were revalued in 1990 by
Knight Frank Kan & Baillieu, an independent professional valuer, at
HK$33,000,000, being their then open market value based on the existing use
basis. No subsequent revaluation was carried out as the Group has adopted the
exemption provisions of Statement of Standard Accounting Practice No. 17
“Property, plant and equipment” issued by the Hong Kong Society of
Accountants of not making regular revaluations by class of those assets stated
at revalued amounts based on revaluations which were reflected in prior year
financial statements. Had such leasehold land and buildings been carried at
cost less accumulated depreciation, the carrying value of such leasehold land
and buildings would have been stated at approximately HK$27,493,000 (1997:
HK$28,188,000).
The Group's investment properties and leasehold land and buildings are held
under long term leases in Hong Kong.
The investment properties comprise offices, a studio and car parking spaces.
The offices situated at 20/F and 21/F and car parking spaces Nos. 21, 22 and
23 of Bank of America Tower at 12 Harcourt Road, Hong Kong and the Clear
Water Bay TV Studio situated at Clear Water Bay Road, A Kung Wan, Hang
Hau, New Territories were valued by C. Y. Leung & Company Limited, an
independent professional valuer, on an open market value basis based on their
existing use as at 30 June 1998.
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12. INTERESTS IN SUBSIDIARIES
Company
1998 1997
HK$'000 HK$'000
Unquoted shares, at cost 2,491,910 2,491,910
Due from subsidiaries 1,155,100 1,155,100
3,647,010 3,647,010
In the prior year, the unlisted shares of certain subsidiaries were pledged to
a bank to secure loan facilities of HK$340,000,000 granted to the Group.
Such loan was fully repaid during the year.
Details of the principal subsidiaries are set out in note 25 to the financial
statements.
13. INTERESTS IN ASSOCIATED COMPANIES
Group
1998 1997
HK$'000 HK$'000
Share of net assets other
than goodwill :
Shares listed overseas 40,495 73,380
Unlisted shares 6,048 2,444
46,543 75,824
Loan to associated
14,689 8,438
companies
61,232 84,262
Market value of listed
shares at the balance sheet 42,856 86,032
date
Particulars of the principal associated companies are set out in note 25 to

the financial statements.
14. LONG TERM INVESTMENTS
Group
1998 1997
HK$'000 HK$'000
Listed shares, at cost
Hong Kong 406,850 94,216
Philippines 60,213 31,582
467,063 125,798
Less: Provision for diminution in value (256,000) —
211,063 125,798
Unlisted shares, at cost 10 10
211,073 125,808
Market value of listed shares at the balance sheet

210,955 122,547
date
15. INVENTORIES
Group
1998 1997
HK$'000 HK$'000
Raw materials 22,935 19,737
Work in progress 1,148 2,379
Finished goods 22,005 19,274
46,088 41,390
16. SHORT TERM INVESTMENTS
Group
1998 1997
HK$'000 HK$'000
Listed shares, at cost
Hong Kong — 36,703
OverSeas — —
— 36,703
Unlisted investment
certificates issued by a
financial institution,
at cost — 340,000
— 376,703
Less: Provision for
— —
diminution in value
— 376,703
Market value of listed
shares at the balance — 42,277
sheet date
During the year, certain short term investments have been reclassified as
long term investments as it is the intention of the directors to hold these
investment for long term purposes.
17. BANK LOANS, SECURED
Group
1998 1997
HK$'000 HK$'000
Bank loans, secured 67,977 410,182
Portion classified as current liabilities (18,805) (342,205)
Long term portion 49,172 67,977
Repayable:
within one year 18,805 342,205
in the second year 46,220 18,805
in the third to fifth years inclusive 2,952 49,172
67,977 410,182
18. DEFERRED TAXATION

Group
1998 1997
HK$'000 HK$'000
At beginning of year 62,304 62,384
Charge/(credit) for the year
19,940 (80)
(note 6)
At end of year 82,244 62,304
The principal component of the Group's deferred tax liability comprises

accelerated depreciation allowances.
The revaluation of the Group's investment properties and the leasehold

land and buildings does not constitute a timing difference and,
consequently, the amount of potential deferred tax thereon has not been
quantified.
There are no significant potential deferred tax liabilities for which

provision has not been made.
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page: 1 2 3 4 5 6 7
19. SHARE CAPITAL
Company
1998 1997
HK$'000 HK$'000
Authorised:
5,000,000,000 shares of HK$0.10
each
(1997: 2,000,000,000 shares ) 500,000 200,000
Issued and fully paid:

1,730,999,996 shares of HK$0.10 173,100 173,100
each
Authorised share capital

On 27 October 1997, the authorised share capital of the Company was increased to
HK$500,000,000 by the creation of additional 3,000,000,000 shares of HK$0.1 each.
Share option scheme

The Company has a share option scheme for employees which was approved by the
shareholders on 5 June 1990. Under the scheme, the Board of Directors of the Company
may grant options to subscribe for shares in the Company to any eligible employee,
including the Executive Directors. The subscription price is the higher of the nominal value
of the shares of the Company and the average of the closing share prices on the five trading
days immediately preceding the granting of the option.
The Company has another share option scheme for employees which was approved by the
shareholders on 27 October 1997. Under the scheme, the Board of Directors of the
Company may grant options to subscribe for shares in the Company to any eligible
employee, including the Executives Directors. The subscription price is the higher of (i) the
nominal value of the shares of the Company and (ii) no less than 90% of the average of the
closing share prices on the five trading days immediately preceding the granting of the
option.
The maximum number of shares in respect of which options may be granted, together with
options exercised and options then outstanding under the schemes, may not exceed 2% of
the issued share capital of the Company from time to time excluding any shares issued
pursuant to the schemes.
No option may be exercised earlier than one year or later than ten years after it has been
granted and no option may be granted more than nine years after the date on which the
schemes became effective. There were no share options granted or exercised during the
year.
20. RESERVES
Investment
property Asset
Share Contributed revluation revaluation Translation Retained
premium surplus reserve reserve reserve profits Total
HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000
Group
At beginning
of year 1,131,900 1,488,728 192,034 1,503 282 1,324,926 4,139,373
Revaluation
deficit (note
11) — — (189,000) — — — (189,000)
Goodwill on
acquisition of
additional
shareholdings
in a
subsidiary — (6,629) — — — — (6,629)
Exchange
differences
on
consolidation — — — — (32,459) — (32,459)
Profit for the
year — — — — — 412,168 412,168
Dividends
(note 8) — — — — — (519,300) (519,300)
At 30 June
1998 1,131,900 1,482,099 3,034 1,503 (32,177) 1,217,794 3,804,153
Company
At beginning
of year 1,131,900 2,342,010 — — — — 3,473,910
Net profit for

the year — — — — — 519,300 519,300
Dividends
(note 8) — — — — — (519,300) (519,300)
At 30 June
1998 1,131,900 2,342,010 — — — — 3,473,910
Group
1998 1997
HK$'000 HK$'000
Profits are retained as follows:
Company and subsidiaries 1,217,605 1,320,661
Associated companies 189 4,265
1,217,794 1,324,926
The contributed surplus of the Group represents the excess of the nominal value of the
shares of subsidiaries acquired over the nominal value of the Company's shares issued in
exchange therefore during the Group reorganisation in 1990, less goodwill arising on
acquisition of an associated company and subsidiaries written off in the prior year .
The contributed surplus of the Company arose as a result of the Group reorganisation in
1990 and represents the difference between the nominal value of the Company's shares so
allotted and the then consolidated net asset value of the acquired subsidiaries and associated
company. Under Bermudan law, the contributed surplus is distributable to shareholders
under certain circumstances.
At 30 June 1998, the total amount of reserves of the Company available for cash distribution
and/or distribution in specie is HK$2,342,010,000 (1997: HK$2,342,010,000) as computed
in accordance with the Companies Act 1981 of Bermuda (as amended). In addition, the
Company's share premium of HK$1,131,900,000 (1997: HK$1,131,900,000) can be
distributed as fully paid-up bonus shares.
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21. OPERATING LEASE COMMITMENTS

Annual commitments for the forthcoming year under non-cancellable
operating leases in respect of land and buildings at the balance sheet date
are set out below:
Group
1998 1997
HK$'000 HK$'000
Expiring within one
2,870 4,456
year
Expiring in the second
44,350 36,277
to fifth years, inclusive
Expiring after five
22,423 25,349
years
69,643 66,082
22. CAPITAL COMMITMENTS
Group
1998 1997
HK$'000 HK$'000
Capital commitments for the
acquisition of fixed assets:
Contracted for 19,034 232,943
Authorised but not
34,274 101,487
contracted for
53,308 334,430
Included in the last year’s capital commitments was an amount of HK$217

million contracted for the development of a commercial complex and an
amusement centre in Shanghai by a subsidiary, Shanghai Pacific Ice Palace
Corporation. At balance sheet date, the subsidiary put the development

project on hold and was in the process of terminating its legal obligations in
respect of such commitments. In the opinion of the directors, there is no
prospect of the project proceeding. Accordingly, the outstanding capital
commitments in respect of this development project of HK$210 million as
at 30 June 1998 has not been included in the Group’s capital commitments
as shown above.
23.NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
(a) Reconciliation of operating profit to net cash inflow from operating

activities:
Group
1998 1997
HK$'000 HK$'000
Operating profit 544,454 947,810
Exceptional item 256,000 —
Depreciation 82,450 76,427
Interest income (51,861) (51,792)
Net rental income from investment
properties (81,522) (76,578)
Dividend income from listed
(11,066) (3,007)
investments
Interest expenses 28,029 33,158
Loss on disposal of fixed assets 1,592 3,432
Gain on disposal of an associated
— (3,020)
company
Gain on disposal of short term listed
(2,571) (28,750)
investments
Increase in loan to associated
(6,251) (2,108)
companies
Decrease/(increase) in prepayments
deposits and other receivables 58,762 (66,870)
Decrease / (increase) in inventories (4,698) 15,013
Decrease / (increase) in accounts
107,039 (60,024)
receivable
Increase in accounts payable and
15,595 25,945
accrued liabilities
Increase in subscriptions in advance 630 231
Net cash inflow from operating 936,582 809,867

activities
(b) Analysis of changes in financing during the year:

HK$'000
Balance of bank loans at 1 July 1996 360,800
Net cash inflow from financing 49,382
———
Balance of bank loans at 30 June 1997 and 1 July 1997 410,182
Net cash outflow from financing (342,205)

Balance of bank loans at 30 June 67,977
1998
24. PENSION COSTS
The Group operates a defined benefit pension scheme and a defined

contribution pension scheme. The assets of both schemes are held
separately from those of the Group in two administered trust funds. Scheme
assets are managed by independent professional investment managers.
The contributions to the defined benefit pension scheme, currently at 5% of

the monthly salary of eligible employees, are determined with the advice of
The Watson Wyatt Hong Kong Limited, an independent actuary, on the
basis of triennial valuations using the aggregate cost method. Based on the
most recent actuarial valuation as at 1 July 1996 performed in January 1997,
the assets of the scheme exceeded the actuarially calculated pension
liabilities.
The contributions to the defined contribution pension scheme are currently

at 5% - 10% of the monthly salary. The amount of pension cost charged to
the Group's consolidated profit and loss account amounted to
HK$9,482,000 (1997: HK$7,444,000) less forfeitures of HK$2,395,000
(1997: HK$2,127,000).
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25. SUBSIDIARIES AND ASSOCIATED COMPANIES
Particulars of the Company's principal subsidiaries and the Group's principal associated
companies at 30 June 1998 are as follows:
Place of
incorporation / Proportion held
registration and Equity Nature of
Company operations holding Direct Indirect business
South China Morning Cayman Islands Ordinary 100% — Investment
Finance (Cayman) share holding
Limited
South China Morning Cayman Islands Ordinary 100% — Investment

Post share holding
Investments(Cayman)
Limited
South China Morning Hong Kong Ordinary — 100% Newspaper

Post Publishers share and magazine
Limited publishing
South China Morning Singapore Ordinary — 100% Advertising

Post (S) Pte Limited share agent
Sunny Bright Hong Kong Ordinary — 100% Property

Development Limited share holding
Sunny Success Hong Kong Ordinary — 100% Property

Development Limited share holding
SCMP (1994) Limited Hong Kong Ordinary — 100% Investment

share holding
West Side Assets British Virgin Ordinary — 100% Investment
Limited British Virgin Islands share holding
Markland Investments Hong Kong Ordinary — 100% Investment

Limited share holding
TVE (Holdings) Hong Kong Ordinary — 100% Investment

Capital Artists Limited Hong Kong Ordinary — 99.7% Organisation

share and promotion
of stage and
film
performance
and record
publishing
Praise Onward Hong Kong Ordinary — 88.9% Operation and
Development Limited share management
of
kindergartens
Publications Hong Kong Ordinary — 100% Publishing
(Holdings) Limited share
Retailcorp Limited Hong Kong Ordinary — 100% Operation of

share retail kiosks
South Horizons Hong Kong Ordinary — 100% Operation of
Residents Club share recreation club
Limited
Shanghai Pacific Ice The People's Registered — 100% Operation of

Palace Corporation Republic of capital amusement
China centre in
Shanghai
Spotlight Enterprises Hong Kong Ordinary — 100% Operation of
Limited share recreation club
Sun Island English Hong Kong Ordinary — 88.9% Operation and
Kindergarten Limited share management
of
kindergartens
Telford Recreation Hong Kong Ordinary — 100% Operation of
Club Limited share recreation club
TVE International Hong Kong Ordinary — 100% Investment
TVE Publications Hong Kong Ordinary — 100% Publishing

Limited (Formerly share
T.V. Week Limited)
Video-Film Hong Kong Ordinary — 100% Production of

Productions Limited share commercial
films
Kalkeith Limited The Ordinary — 100% Investment
Commonwealth share holding
of The Bahamas
Coastline International The Ordinary — 100% Property
Limited Commonwealth share holding
of The Bahamas
Lyton Investment The Ordinary — 100% Property
Limited Commonwealth share holding
of The Bahamas
Macheer Properties British Virgin Ordinary — 100% Property
Limited Islands share holding
Associated companies
Company Place of % of equity Nature of
incorporation and attributable to business
operations the Group
Asia Magazines, Limited Hong Kong 27.1% Magazine
publishing
The Post Publishing Public Thailand 20.3% Newspaper and
Company Limited magazine
publishing
New Trend International British Virgin 45% Investment
Limited Islands holding
NIIT-TVE (Hong Kong) Hong Kong 35% Operation of

Limited computer
(Formerly Home PC Limited) training centre
Dymocks Franchise Systems Hong Kong 45% Bookshop

(China) Limited operation
Earn Active Limited Hong Kong 50% In liquidation

Start Circle Limited Hong Kong 50% Investment

holding
The above table lists the subsidiaries of the Company and associated companies of the
Group which, in the opinion of the Directors, principally affected the results of the year or
formed a substantial portion of the net assets of the Group. To give details of other
subsidiaries and associated companies would, in the opinion of the Directors, result in
particulars of excessive length.
26. APPROVAL OF THE FINANCIAL STATEMENTS

The financial statements were approved by the Board of Directors on 11 September 1998.
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page: 1 2 3 4 5 6 7

Report of the Auditors

15/F Hutchison House
10 Harcourt Road
Central, Hong Kong
To the members
South China Morning Post (Holdings) Limited
(Incorporated in Bermuda with limited liability)
We have audited the financial statements on pages 39 to 68 which have
been prepared in accordance with accounting principles generally accepted
in Hong Kong.
Respective responsibilities of Directors and auditors
The Company's Directors are responsible for the preparation of financial
statements which give a true and fair view. In preparing financial statements
which give a true and fair view it is fundamental that appropriate
accounting policies are selected and applied consistently. It is our
responsibility to form an independent opinion, based on our audit, on those
statements and to report our opinion to you.
Basis of opinion
We conducted our audit in accordance with Statements of Auditing
Standards issued by the Hong Kong Society of Accountants. An audit
includes an examination, on a test basis, of evidence relevant to the amounts
and disclosures in the financial statements. It also includes an assessment of
the significant estimates and judgements made by the Directors in the
preparation of the financial statements, and of whether the accounting
policies are appropriate to the Company's and the Group's circumstances,
consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance as to whether the financial
statements are free from material misstatement. In forming our opinion we
also evaluated the overall adequacy of the presentation of information in the
financial statements. We believe that our audit provides a reasonable basis
for our opinion.
Opinion
In our opinion the financial statements give a true and fair view, in all
material respects, of the state of affairs of the Company and of the Group as
at 30 June 1998 and of the profit and cash flows of the Group for the year
then ended and have been properly prepared in accordance with the
disclosure requirements of the Hong Kong Companies Ordinance.
Ernst & Young

Hong Kong, 11 September 1998


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South China Morning Post (Holdings) Limited Annual Report 1998

Owen R. Jonathan Morning Post Centre

Paul J. C. Bush Principal Bankers

Lindley J. Holloway The Bank of East Asia, Limited

Dr. The Hon. David Li Kwok Po Auditors

Peter Lee Ting Chang Share Registrars

Butterfield Corporate Services Limited

South China Morning Post (Holdings) Limited

[ SCMP Home ] [ Corporate Information ] [ Chairman's Report ]

Circulation and Readership

Morning Post experienced a small decline.

New Printing Press

The Post Publishing Public Co., Ltd.

Advertisers and Readers

to justify their continued support.

Directors, Management and Staff

Kuok Khoon Ean

[ SCMP Home ] [ Corporate Information ] [ Chairman's Report ]

Facing The Future

Even by Hong Kong’s always lively standards, the 12 months covered by

Colour upgrades offer new opportunities

Award-winning PostNet sets new standards

An investment in the future - 25 years of the SCMP Student Awards

Learning English is fun - with SCMP’s

CD-ROM, the Company will be making yet another contribution to the

[ SCMP Home ] [ Corporate Information ] [ Chairman's Report ]

Five Year Financial Summary

Turnover 2,236,313 2,352,450 1,444,105 1,266,130 1,231,085

1,737,094 1,844,226 1,530,389 1,284,515 1,154,453

ASSETS AND LIABILITIES

Publishing titles 1,820,000 1,820,000 1,820,000 1,820,000 1,820,000

Current assets 832,896 1,385,381 1,096,056 610,156 417,398

Report of The Directors

Major suppliers and customers

Major suppliers and customers

Five year financial summary

Mr.Kuok Khoon Ean Chairman

[ SCMP Home ] [ Corporate Information ] [ Chairman's Report ]

Report of The Directors

Brief biography of Directors and senior management

McAulay is also a Director of Kadoorie McAulay Limited as well as a number

There were no arrangements under which a Director had waived or agreed to

[ SCMP Home ] [ Corporate Information ] [ Chairman's Report ]

Report of The Directors

Five highest paid employees

Directors' interests in shares

Number of ordinary shares

(2) Share options

Name of shareholder Number of ordinary shares

Included in the 592,656,000 shares in the Company held by Kerry Group

The interests in the 193,546,600 shares in the Company held by Templeton

Directors' interests in contracts

Directors' arrangements to acquire shares or debentures

Purchase, redemption or sale of the Company's shares

Code of best practice

The Year 2000

The Company established an enterprise-wide Y2K project group

replacing systems with upgraded versions, the vendors of which have

By order of the Board

Kuok Khoon Ean

[ SCMP Home ] [ Corporate Information ] [ Chairman's Report ]

Audited Financial Statements

Consolidated: •Profit And Loss Account Company: •Balance Sheet

Consolidated Profit and Loss Account