6th Mar 2009 09:05
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To: Business Editor
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6th March 2009
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For immediate release
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The following announcement was issued today to a Regulatory Information Service approved by the Financial Services Authority in the United Kingdom.
Jardine Strategic Holdings Limited
2008 Preliminary Announcement of Results
Highlights
Underlying earnings per share+ up19%
Good results from Astra and Dairy Farm
Markets weaken as year ends
Net asset value per share^ down 36%
Hongkong Land property portfolio value declines in second half
"Following a good year in 2008, it is still too early to judge the full effects of the global downturn on Jardine Strategic's interests in 2009. Nevertheless, the Group remains soundly financed and in a good position to weather the current economic challenges."
Henry Keswick, Chairman
6th March 2009
Results
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Year ended 31st December
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2008
US$m
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2007
US$m
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Change
%
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Revenue together with revenue of associates and joint ventures*
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36,156
|
31,616
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+14
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Underlying profit attributable to shareholders+
|
859
|
723
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+19
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Profit attributable to shareholders
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692
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2,024
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-66
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Shareholders' funds
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9,705
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9,787
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-1
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US$
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US$
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%
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Underlying earnings per share+
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1.39
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1.17
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+19
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Earnings per share
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1.12
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3.28
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-66
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Dividends per share
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0.19
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0.18
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+6
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Net asset value per share^
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18.15
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28.22
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-36
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* Includes 100% of revenue from associates and joint ventures
+ The Group uses 'underlying business performance' in its internal financial reporting to distinguish between the underlying profits and non-trading items, as more fully described in note 10. Management considers this to be a key measure and has provided this analysis as additional information in order to provide greater understanding of the Group's underlying business performance.
^ Net asset value per share is on a market value basis, details of which are set out in note 18
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The final dividend of US¢13.10 per share will be payable on 13th May 2009, subject to approval at the Annual General Meeting to be held on 7th May 2009, to shareholders on the register of members at the close of business on 20th March 2009 and will be available in cash with a scrip alternative. The ex-dividend date will be on 18th March 2009, and the share registers will be closed from 23rd to 27th March 2009, inclusive.
Jardine Strategic Holdings Limited
Preliminary Announcement of Results
For The Year Ended 31st December 2008
Overview
After a good first nine months in 2008, several of the Group's businesses were affected in the final quarter by the global economic downturn which followed the sharp further deterioration in financial markets. Overall, however, the earnings momentum achieved led to a satisfactory result for the full year.
Performance
Jardine Strategic recorded an underlying profit of US$859 million for 2008, an increase of 19%. Underlying earnings per share rose 19% to US$1.39. The turnover of the Group for the year, including 100% of associates and joint ventures, was US$36.2 billion, compared with US$31.6 billion in 2007.
Within Jardine Matheson, Jardine Pacific did well to record modestly higher earnings as certain of its businesses faced weaker markets. Jardine Motors had a more difficult year, particularly in the United Kingdom, while Jardine Lloyd Thompson achieved an improved trading performance. Dairy Farm produced another impressive result with all its major retail operations continuing to perform well. Hongkong Land reported a good increase in profit from its commercial properties, but weakness in the Singapore residential market led to provisions being required. At Mandarin Oriental, profits declined as trading conditions became harsher as the year progressed. Jardine Cycle & Carriage benefited from an overall strong year at Astra, despite some softening towards the year end. The Group also benefited from lower net financing charges.
The Company's share of the downward revaluation of investment properties for 2008 included US$253 million from Hongkong Land and US$5 million from Jardine Matheson, and compares with upward revaluations of US$1,211 million in 2007. These revaluations are taken through the profit and loss account in accordance with accounting standards and, together with other non-trading items, being principally a gain of US$97 million arising on an increase in the Company's interest in Hongkong Land partly offset by a US$32 million share in the reduction in the fair value of plantations, led to a profit attributable to shareholders of US$692 million. This compares with US$2,024 million in 2007.
The Group benefits from surplus cash, strong operating cash flows and substantial committed facilities with no significant refinancing required over the next year. At 31st December 2008, consolidated net debt excluding financial services companies was 38% lower at US$528 million, resulting in gearing of 4%. Hongkong Land, currently an associate, had net debt of US$2,601 million at the year end. Assuming the pro-forma consolidation of Hongkong Land, the Group's gearing excluding financial services companies was 16% at the end of 2008.
Shareholders' funds were 1% lower at US$9.7 billion. The net asset value per share, based on the market price of the Company's holdings, declined by 36% to US$18.15 at the year end.
The Board is recommending a final dividend of US¢13.10 per share, representing an overall increase of 6% for the full year.
Business Activity
Within Jardine Matheson, Jardine Pacific saw mixed results from its businesses, although its engineering and construction operations performed well and are expected to benefit further from increased expenditure on infrastructure projects. Jardine Motors was more severely affected by the economic downturn, particularly in the United Kingdom, but the development of its network of Mercedes-Benz outlets in Southern China remains on track. Jardine Lloyd Thompson's restructuring is now substantially complete and has produced greater business volumes, lower costs and enhanced profitability.
Hongkong Land's property markets came off their highs in the second half of 2008, but the company's earnings will continue to benefit from positive rental reversions achieved during the year. Sales of its residential developments, however, are likely to become more difficult. Construction is proceeding at its Singapore joint venture development, Marina Bay Financial Centre, with over 60% of the commercial office space having been pre-committed well in advance of completion. Hongkong Land is expected to become a subsidiary during 2009 after many years of open market share purchases.
Dairy Farm is continuing to expand its retail businesses across Asia's growing consumer markets, particularly in Malaysia, Indonesia and mainland China, and the group is now operating some 4,650 outlets in the region. Strong growth was achieved in both sales and profit in 2008, and positive cash flows had eliminated net borrowings by the year end.
Mandarin Oriental's expansion plans are progressing well despite the worsening trading environment. It currently has 23 hotels in operation and expects to open a further 3 in 2009. The group has added Moscow and Atlanta to its development portfolio of 18 properties, although some projects might face delays in the current climate. In January 2009, agreement was reached for the sale of the group's 50% interest in its existing property in Macau, which should give rise to a profit of US$75 million when completed later this year.
In July 2008, Jardine Cycle & Carriage acquired a 20% interest in Truong Hai Automotive Corporation, a Vietnamese group with interests in the manufacture, sale and maintenance of commercial vehicles and passenger cars. The investment offers further exposure for the Group to the developing Vietnamese economy.
Astra benefited from a robust Indonesian economy in 2008 with particularly good sales in its motor operations and record earnings from its palm oil plantations, although commodity prices and economic conditions deteriorated in the final quarter. The group has continued to develop its coal mining interests with the acquisition of a further mine, while at the same time expanding its palm oil plantations.
During the year the Company acquired a further 1% interest in Hongkong Land, which itself repurchased 2% of its issued capital in the latter part of the year. The Company also increased its shareholding in Jardine Cycle and Carriage to 68%, while Astra invested further in shares of its subsidiaries, United Tractors and Astra Otoparts.
Outlook
In conclusion, the Chairman, Henry Keswick said, "Following a good year in 2008, it is still too early to judge the full effects of the global downturn on Jardine Strategic's interests in 2009. Nevertheless, the Group remains soundly financed and in a good position to weather the current economic challenges."
Operating Review
Jardine Matheson
Jardine Matheson achieved a record underlying profit of US$822 million in 2008, an increase of 14%. Underlying earnings per share rose 15% to US$2.33. Jardine Matheson's profit attributable to shareholders of US$666 million reflected the reduced investment property values in Hongkong Land and Jardine Pacific and other non-trading items. Shareholders' funds decreased 3% to US$8.2 billion.
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Jardine Pacific |
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Jardine Pacific produced an underlying profit of US$116 million in 2008, slightly above 2007, with good performances from its engineering and construction businesses. A decrease of US$10 million in the value of the group's investment property portfolio was substantially offset by gains on disposals, leading to a profit attributable to shareholders of US$113 million for the year. Shareholders' funds were US$361 million at the end of 2008, giving an underlying return of 28% on average shareholders' funds. Gammon benefited from increased volumes, leading to improved profits and a record order book. Jardine Schindler performed satisfactorily on new installations and grew its maintenance portfolio, while JEC's profit reflected a good performance in Thailand. Hong Kong Air Cargo Terminals suffered from the sharp global slowdown in trade in the final quarter of 2008, recording a 4% drop in cargo throughput for the full year. Jardine Shipping Services experienced lower freight rates and volumes in the second half, while Jardine Aviation Services was also impacted by reduced fee income and higher operating costs. Jardine Restaurants saw softening in sales in both Hong Kong and Taiwan, and JOS recorded lower sales due to a weaker market. |
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Jardine Motors |
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Jardine Motors' underlying profit declined 30% in 2008 to US$44 million, primarily due to the deterioration in the motor vehicle market in the United Kingdom. Its profit attributable to shareholders, at US$39 million, was also reduced by a fall in the value of properties. Zung Fu achieved satisfactory results in Hong Kong with deliveries of Mercedes-Benz passenger cars at similar levels to 2007, despite the adverse effects of the economic downturn in the final quarter. Its dealership in Macau also benefited from higher sales. In Southern China, its Mercedes-Benz dealerships continued their profitable growth in 2008 with new car deliveries increasing by over 30%. The group's operations in the United Kingdom, however, experienced very difficult trading conditions, and additional costs were also incurred in repositioning the business to address the market weaknesses. |
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Jardine Lloyd Thompson |
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Jardine Lloyd Thompson's businesses performed well in 2008 despite the challenging conditions in insurance markets as the group benefited from the repositioning undertaken in recent years. The group announced a turnover equivalent to US$989 million, up 13% in its reporting currency, due to good organic growth and acquisitions. Underlying profit after tax and minorities in its reporting currency was 17% higher, reflecting the higher turnover, an increased contribution from an associate and reduced costs. The profit after tax and minorities was equivalent to US$117 million, a decrease of 12% in its reporting currency from the 2007 result which had included an exceptional net gain. The risk & insurance group, comprising Jardine Lloyd Thompson's worldwide retail operations and specialist risk and insurance broking operations based largely in London, achieved a satisfactory increase in turnover and trading profit against a background of continuing soft insurance market conditions. The employee benefits business in the United Kingdom also achieved good increases in both turnover and trading profit. Trading profit margins were maintained or improved across the group. |
Hongkong Land A positive rental reversion cycle in Hong Kong's Central district enabled Hongkong Land to report an underlying profit up 9% at US$375 million, despite a US$140 million share of a provision against residential development properties in Singapore by its subsidiary MCL Land. The year-end valuation of the group's commercial investment properties, including the share of investment properties in joint ventures and associates, was 4% lower for the year at US$14,525 million. The incorporation of this revaluation produced a loss attributable to shareholders of US$109 million, compared with a profit of US$2,840 million in 2007.
While rents in Hong Kong's Central district remained at record levels throughout 2008 and demand for high quality commercial office space continued to be strong, there were signs of weakening towards the year end. The luxury retail market also performed well before it too started to weaken in the fourth quarter. The Singapore office market began to soften in the second half of the year, although the group's wholly-owned property One Raffles Link and its joint venture property One Raffles Quay both remain fully let. Its joint venture development, Marina Bay Financial Centre, which is due to complete in two phases in 2010 and 2012, now has over 60% of its commercial office space pre-committed. In the residential sector, developments in Beijing, Chongqing and Singapore were completed during the year allowing profits to be recognized.
Dairy Farm
Trading conditions were generally favourable in Dairy Farm's major markets in 2008. The group achieved further good results with sales, including 100% of associates, increasing by 13% to US$7.7 billion and underlying net profit increasing by 24% to US$320 million. Its profit attributable to shareholders was US$333 million and included non-trading gains of US$13 million from asset disposals. Overall, Dairy Farm's cash generation has remained strong leading to the effective elimination of net gearing at the year end and ensuring that adequate funds are available for expansion.
Dairy Farm's operations in both Hong Kong and Macau performed well. In Southern China, it now has more than 500 7-Eleven stores operating, and improved results have been achieved from its enhanced health and beauty outlets. In Taiwan, Dairy Farm's supermarkets performed better with the continued development of smaller-format fresh stores, while IKEA's underlying performance is making progress. Maxim's was able to maintain its profitability despite much more challenging conditions in Hong Kong.
All formats in Malaysia achieved another year of good results as expansion continued in both peninsular Malaysia and East Malaysia. Its growth in Singapore was led by the supermarkets and convenience stores, while Giant hypermarkets also performed better following a difficult year in 2007. Dairy Farm's performance in Indonesia improved significantly in all formats, with nine new hypermarkets being opened bringing the total to 26. The group has also extended its operations to Brunei. In the group's joint ventures in India, its health and beauty chain maintained a measured pace of expansion while its supermarkets continued to face highly competitive trading conditions.
Mandarin Oriental
After a satisfactory start to the year Mandarin Oriental faced weakening demand as global economic conditions deteriorated, particularly from September 2008 onwards in what is traditionally its strongest season. Earnings before interest, tax, depreciation and amortization for the year were 14% lower at US$164 million. Profit attributable to shareholders was US$67 million, compared to US$108 million in 2007 which included US$21 million in non-trading items.
Most of the group's hotels experienced lower occupancy as demand from the corporate sector declined, although the resilience of the leisure sector contributed to increases in the average room rate. The group's wholly-owned Hong Kong hotels maintained their profitability, but the results from Europe were adversely affected by currency movements and an eight-month renovation project in Geneva. The group's hotels in The Americas were affected by the downturn, but maintained their competitive positions.
Mandarin Oriental's development programme progressed with the announcement of hotel management projects in Moscow and Atlanta, both to be completed in 2011, and a luxury resort in The Maldives, due to open in the next 12 months. Hotels were opened in Boston in October 2008 and Sanya in early 2009, and a further three are due to open this year in Marrakech, Barcelona and Las Vegas, all under long-term management contracts. The opening of its Beijing hotel, which is also a management contract, has been postponed following a fire at the site. Mandarin Oriental now operates 23 hotels with a further 18 under development.
The group has announced the sale of its 50% interest in its existing Macau hotel for some US$90 million, producing a net gain of approximately US$75 million that will be recognized upon its expected completion in mid 2009.
Jardine Cycle & Carriage
Jardine Cycle & Carriage produced a satisfactory result in 2008 with good performances across the group in the first nine months. A number of its businesses were, however, affected in the final quarter by a decline in commodity prices, the weakening of the Indonesian Rupiah and a tightening of credit. Underlying profit rose by 28% to US$477 million in 2008, while profit attributable to shareholders was 32% higher at US$448 million, after accounting for a net non-trading loss of US$29 million. The group's balance sheet remains strong with low levels of gearing.
Astra's contribution to the underlying profit was up 29% at US$460 million, with robust automotive sales and a strong performance by its non-automotive activities for most of the year. Jardine Cycle & Carriage's share of underlying profit from its other motor interests increased by 4% to US$44 million. There was a good performance in Singapore as sales of Mercedes-Benz improved despite a contraction in the motor market and a fine result at Tunas Ridean in Indonesia. Cycle & Carriage Bintang in Malaysia completed a restructuring so as to focus exclusively on Mercedes-Benz, and its reduced requirement for operating funds enabled a special dividend of US$30 million to be paid.
Jardine Cycle & Carriage has invested US$77 million to acquire a 20% shareholding in Truong Hai Automotive Corporation, a Vietnamese group with interests in the manufacture, sale and maintenance of commercial vehicles and passenger cars. The company also increased its shareholding in Tunas Ridean to 38%. In January 2009, Tunas Ridean sold a 51% interest in its wholly-owned automotive finance subsidiary to Bank Mandiri.
Astra
Astra reported a net profit for the year, under Indonesian accounting standards, equivalent to US$942 million, an increase of 41% in its reporting currency. Strong operating cash flows, a substantial dividend from Astra Honda Motor and proceeds from a rights issue by United Tractors were substantially offset by the cost of acquisitions and the investment in shares in group companies, leaving Astra's year-end net debt, excluding borrowings within its financial services operations, largely unchanged at US$169 million.
Astra's automotive operations benefited from a 40% increase in the Indonesian wholesale motor vehicle market. Its sales grew by 43% to 318,000 units, supported by the launch of new models, resulting in an increased market share of 52%. The wholesale motorcycle market grew by 33% in 2008 to 6.2 million units, and sales of the Astra Honda Motor manufacturing and distribution joint venture rose by 34% to 2.9 million units, maintaining its market share at 46%. Astra Otoparts reported a profit up 24% as sales rose by 27%.
The performance of Astra's consumer finance operations improved in line with the growth in automotive sales. The volume financed was US$2.7 billion, up 29% in Indonesian Rupiah, although the consumer finance loan book at the year end was little changed at US$1.3 billion as most new business was joint finance without recourse. The profit at 44.5%-owned Bank Permata was down 9% in its reporting currency at US$46 million.
There was an excellent result from 80%-held Astra Agro Lestari with a 33% growth in profit. Palm oil production rose by 7% to 982,000 tonnes and prices achieved were on average 19% higher than in 2007, although prices have now declined significantly from their recent highs. During the year, the company increased its planted area by 10% to 251,000 hectares.
In a good year for United Tractors, which is 60%-held, profit was 78% higher. Sales of Komatsu equipment rose 26% to some 4,300 units, although demand reduced significantly in the last quarter. Mining subsidiary, Pamapersada Nusantara, achieved an 8% increase in coal extracted at 59 million tonnes and a 25% increase in overburden removed at 442 million bcm in its contract mining operations, while coal sales from its own mines amounted to 4 million tonnes.
Astra's information technology business and infrastructure investments performed satisfactorily.
Further Interests
Rothschilds Continuation, in which the Company holds a 21% interest, is the holding company of an independent financial services group which has some 50 offices in more than 37 countries worldwide. In a very difficult year globally for the financial services sector, Rothschild fully maintained its position as a leading M&A adviser, although volumes declined. There was, however, increasing demand for the group's debt and restructuring advisory services as the year progressed.
Tata Industries is an unlisted Indian investment company in which the Company holds a 20% shareholding. Tata Industries' largest investment is in Tata Teleservices, a primarily mobile service provider in the fast growing Indian telecom sector. In 2008, DoCoMo of Japan invested US$2.7 billion in Tata Teleservices for a 26% holding and this new capital will be largely employed in the continuing roll-out of Tata Teleservices' GSM infrastructure.
Asia Commercial Bank in Vietnam encountered a significantly tougher trading environment in 2008. Banking sector restrictions to counter inflation were imposed early in the year and these eased only when the global economic slowdown impacted Vietnam later in the year. Despite this, the bank reported 2008 pre-tax profit growth of 20% and paid a special dividend, of which the Company's 7% share was US$5 million.
Anthony Nightingale
Managing Director
6th March 2009
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Jardine Strategic Holdings Limited |
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Consolidated Profit and Loss Account |
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for the year ended 31st December 2008 |
|
2008 |
2007 |
||||||||||||||||
|
Underlying |
Non- |
Underlying |
Non- |
||||||||||||||
|
business |
trading |
business |
trading |
||||||||||||||
|
performance |
items |
Total |
performance |
items |
Total |
||||||||||||
|
US$m |
US$m |
US$m |
US$m |
US$m |
US$m |
||||||||||||
|
Revenue (note 2) |
18,455 |
- |
18,455 |
15,328 |
- |
15,328 |
|||||||||||
|
Net operating costs (note 3) |
(16,775) |
(106) |
(16,881) |
(13,977) |
133 |
(13,844) |
|||||||||||
|
Operating profit (note 4) |
1,680 |
(106) |
1,574 |
1,351 |
133 |
1,484 |
|||||||||||
|
Financing charges |
(123) |
- |
(123) |
(177) |
- |
(177) |
|||||||||||
|
Financing income |
87 |
- |
87 |
82 |
- |
82 |
|||||||||||
|
Net financing charges |
(36) |
- |
(36) |
(95) |
- |
(95) |
|||||||||||
|
Share of results of Jardine |
|||||||||||||||||
|
Matheson (note 5) |
119 |
(3) |
116 |
130 |
59 |
189 |
|||||||||||
|
Share of results of associates |
|||||||||||||||||
|
and joint ventures (note 6 |
497 |
(146) |
351 |
425 |
1,101 |
1,526 |
|||||||||||
|
Profit before tax |
2,260 |
(255) |
2,005 |
1,811 |
1,293 |
3,104 |
|||||||||||
|
Tax (note 7) |
(481) |
28 |
(453) |
(372) |
(20) |
(392) |
|||||||||||
|
Profit after tax |
1,779 |
(227) |
1,552 |
1,439 |
1,273 |
2,712 |
|||||||||||
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Attributable to: |
|||||||||||||||||
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Shareholders of the |
|||||||||||||||||
|
Company (notes 8 & 10) |
859 |
(167) |
692 |
723 |
1,301 |
|
2,024 |
||||||||||
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Minority interests |
920 |
(60) |
860 |
716 |
(28) |
688 |
|||||||||||
|
1,779 |
(227) |
1,552 |
1,439 |
1,273 |
2,712 |
||||||||||||
|
US$ |
US$ |
US$ |
US$ |
||||||||||||||
|
Earnings per share (note 9) |
|||||||||||||||||
|
- basic |
1.39 |
1.12 |
1.17 |
3.28 |
|||||||||||||
|
- diluted |
1.39 |
1.12 |
1.17 |
3.19 |
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Jardine Strategic Holdings Limited |
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Consolidated Balance Sheet |
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at 31st December 2008 |
||||||||||||||||
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2008 |
2007 |
|||||||||||||||
|
US$m |
US$m |
|||||||||||||||
|
Assets |
||||||||||||||||
|
Intangible assets |
1,865 |
1,766 |
||||||||||||||
|
Tangible assets |
3,097 |
2,912 |
||||||||||||||
|
Investment properties |
17 |
28 |
||||||||||||||
|
Plantations |
353 |
515 |
||||||||||||||
|
Investment in Jardine Matheson |
793 |
962 |
||||||||||||||
|
Associates and joint ventures |
7,440 |
7,514 |
||||||||||||||
|
Other investments |
562 |
697 |
||||||||||||||
|
Non-current debtors |
1,032 |
998 |
||||||||||||||
|
Deferred tax assets |
92 |
102 |
||||||||||||||
|
Pension assets |
15 |
107 |
||||||||||||||
|
Non-current assets |
15,266 |
15,601 |
||||||||||||||
|
Stocks and work in progress |
1,574 |
1,225 |
||||||||||||||
|
Current debtors |
1,872 |
1,957 |
||||||||||||||
|
Current investments |
4 |
21 |
||||||||||||||
|
Current tax assets |
76 |
149 |
||||||||||||||
|
Bank balances and other liquid funds |
||||||||||||||||
|
- non-financial services companies |
1,709 |
1,423 |
||||||||||||||
|
- financial services companies |
183 |
167 |
||||||||||||||
|
1,892 |
1,590 |
|||||||||||||||
|
5,418 |
4,942 |
|||||||||||||||
|
Non-current assets classified as held for sale (note 11) |
65 |
43 |
||||||||||||||
|
Current assets |
5,483 |
4,985 |
||||||||||||||
|
Total assets |
20,749 |
20,586 |
||||||||||||||
|
Equity |
||||||||||||||||
|
Share capital |
|
55 |
54 |
|||||||||||||
|
Share premium and capital reserves |
1,338 |
1,331 |
||||||||||||||
|
Revenue and other reserves |
9,620 |
9,611 |
||||||||||||||
|
Own shares held |
(1,308) |
(1,209) |
||||||||||||||
|
Shareholders' funds (note 12) |
9,705 |
9,787 |
||||||||||||||
|
Minority interests |
3,632 |
3,531 |
||||||||||||||
|
Total equity |
13,337 |
13,318 |
||||||||||||||
|
Liabilities |
||||||||||||||||
|
Long-term borrowings |
||||||||||||||||
|
- non-financial services companies |
1,754 |
1,775 |
||||||||||||||
|
- financial services companies |
563 |
616 |
||||||||||||||
|
2,317 |
2,391 |
|||||||||||||||
|
Deferred tax liabilities |
389 |
508 |
||||||||||||||
|
Pension liabilities |
94 |
66 |
||||||||||||||
|
Non-current creditors |
133 |
63 |
||||||||||||||
|
Non-current provisions |
48 |
34 |
||||||||||||||
|
Non-current liabilities |
2,981 |
3,062 |
||||||||||||||
|
Current creditors |
2,903 |
2,670 |
||||||||||||||
|
Current borrowings |
||||||||||||||||
|
- non-financial services companies |
483 |
499 |
||||||||||||||
|
- financial services companies |
798 |
806 |
||||||||||||||
|
1,281 |
1,305 |
|||||||||||||||
|
Current tax liabilities |
220 |
198 |
||||||||||||||
|
Current provisions |
27 |
33 |
||||||||||||||
|
Current liabilities |
4,431 |
4,206 |
||||||||||||||
|
Total liabilities |
7,412 |
7,268 |
||||||||||||||
|
Total equity and liabilities |
20,749 |
20,586 |
||||||||||||||
|
|
|
Jardine Strategic Holdings Limited |
||||||||||||||||||||||
|
Consolidated Statement of Recognized Income and Expense |
||||||||||||||||||||||
|
for the year ended 31st December 2008 |
||||||||||||||||||||||
|
2008 |
2007 |
|||||||||||||||||||||
|
US$m |
US$m |
|||||||||||||||||||||
|
Surpluses on revaluation of intangible assets |
13 |
- |
||||||||||||||||||||
|
Surpluses on revaluation of properties |
16 |
114 |
||||||||||||||||||||
|
(Losses)/gains on revaluation of other investments |
(292) |
165 |
||||||||||||||||||||
|
Actuarial (losses)/gains on employee benefit plans |
(228) |
59 |
||||||||||||||||||||
|
Net exchange translation differences |
(810) |
(95) |
||||||||||||||||||||
|
Losses on cash flow hedges |
(34) |
(7) |
||||||||||||||||||||
|
Tax on items taken directly to equity |
134 |
(20) |
||||||||||||||||||||
|
Net (loss)/income recognized directly in equity |
(1,201) |
216 |
||||||||||||||||||||
|
Transfer to profit and loss on disposal of other investments |
3 |
(59) |
||||||||||||||||||||
|
Transfer to profit and loss on realization of exchange reserves |
(2) |
(4) |
||||||||||||||||||||
|
Transfer to profit and loss in respect of cash flow hedges |
(1) |
2 |
||||||||||||||||||||
|
Profit after tax |
1,552 |
2,712 |
||||||||||||||||||||
|
Total recognized income and expense for the year |
351 |
2,867 |
||||||||||||||||||||
|
Attributable to: |
||||||||||||||||||||||
|
Shareholders of the Company |
(45) |
2,263 |
||||||||||||||||||||
|
Minority interests |
396 |
604 |
||||||||||||||||||||
|
351 |
2,867 |
|||||||||||||||||||||
|
|
|
|
|
|
||||||||||||||||||
|
Surpluses on revaluation of intangible assets represent the increase in fair value attributable to the Group's previously held interests in associates on the dates they became subsidiary undertakings. |
||||||||||||||||||||||
|
Jardine Strategic Holdings Limited |
|||||||||||
|
Consolidated Cash Flow Statement |
|||||||||||
|
for the year ended 31st December 2008 |
|
|
|
|
|
|
|||||
|
2008 |
2007 |
||||||||||
|
|
US$m |
|
|
|
US$m |
|
|||||
|
Operating activities |
|||||||||||
|
Operating profit |
|
1,574 |
|
|
1,484 |
|
|||||
|
Depreciation and amortization |
|
490 |
|
|
450 |
|
|||||
|
Other non-cash items |
|
314 |
|
|
50 |
|
|||||
|
(Increase)/decrease in working capital |
|
(279) |
|
|
93 |
|
|||||
|
Interest received |
|
89 |
|
|
75 |
|
|||||
|
Interest and other financing charges paid |
|
(129) |
|
|
(175) |
|
|||||
|
Tax paid |
|
(407) |
|
|
(267) |
|
|||||
|
|
1,652 |
|
|
1,710 |
|
||||||
|
Dividends from Jardine Matheson |
|
152 |
|
|
131 |
|
|||||
|
Dividends from associates and joint ventures |
|
386 |
|
|
203 |
|
|||||
|
Cash flows from operating activities |
2,190 |
2,044 |
|||||||||
|
Investing activities |
|||||||||||
|
Purchase of subsidiary undertakings (note 14(a)) |
|
(413) |
|
|
(26) |
|
|||||
|
Purchase of associates and joint ventures (note 14(b)) |
|
(205) |
|
|
(113) |
|
|||||
|
Purchase of other investments (note 14(c)) |
|
(204) |
|
|
(80) |
|
|||||
|
Purchase of land use rights |
|
(54) |
|
|
(30) |
|
|||||
|
Purchase of other intangible assets |
|
(38) |
|
|
(28) |
|
|||||
|
Purchase of tangible assets |
|
(878) |
|
|
(568) |
|
|||||
|
Purchase of plantations |
|
(71) |
|
|
(41) |
|
|||||
|
Advance of mezzanine loans |
|
(1) |
|
|
(3) |
|
|||||
|
Repayment of mezzanine loans |
|
- |
|
|
12 |
|
|||||
|
Capital distribution from associates |
|
23 |
|
|
14 |
|
|||||
|
Sale of subsidiary undertakings (note 14(d)) |
|
(33) |
|
|
- |
|
|||||
|
Sale of associates and joint ventures (note 14(e)) |
|
25 |
|
|
104 |
|
|||||
|
Sale of other investments (note 14(f)) |
|
82 |
|
|
127 |
|
|||||
|
Sale of land use rights |
|
9 |
|
|
14 |
|
|||||
|
Sale of tangible assets |
|
84 |
|
|
43 |
|
|||||
|
Sale of investment properties |
|
9 |
|
|
6 |
|
|||||
|
Sale of plantations |
|
14 |
|
|
- |
|
|||||
|
Cash flows from investing activities |
(1,651) |
(569) |
|||||||||
|
Financing activities |
|||||||||||
|
Capital contribution from minority shareholders |
|
159 |
|
|
5 |
|
|||||
|
Drawdown of borrowings |
|
3,555 |
|
|
3,664 |
|
|||||
|
Repayment of borrowings |
|
(3,421) |
|
|
(4,572) |
|
|||||
|
Dividends paid by the Company |
|
(32) |
|
|
(33) |
|
|||||
|
Dividends paid to minority shareholders |
|
(363) |
|
|
(256) |
|
|||||
|
|
|
|
|
|
|
||||||
|
Cash flows from financing activities |
(102) |
(1,192) |
|||||||||
|
Effect of exchange rate changes |
(109) |
(16) |
|||||||||
|
|
|
||||||||||
|
Net increase in cash and cash equivalents |
328 |
267 |
|||||||||
|
Cash and cash equivalents at 1st January |
1,554 |
1,287 |
|||||||||
|
Cash and cash equivalents at 31st December |
1,882 |
1,554 |
|||||||||
|
|
|
|
|
|
|
|
|||||
|
Jardine Strategic Holdings Limited
|
|
|
|
|
|
|||||||||||||||||||
|
Notes
|
|
|
|
|
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
1.
|
Accounting Policies and Basis of Preparation
|
|
|
|
|
|
|
|
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
The financial information contained in this announcement has been based on the audited results for the year ended 31st December 2008 which have been prepared in conformity with International Financial Reporting Standards, including International Accounting Standards and Interpretations adopted by the International Accounting Standards Board.
|
|
|
|||||||||||||||||||||
|
|
In 2008, the Group adopted the following interpretations to existing standards which are relevant to its operations:
|
|
|
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
IFRIC 11
|
IFRS 2 - Group and Treasury Share Transactions
|
|
|
||||||||||||||||||||
|
|
IFRIC 12
|
Service Concession Arrangements
|
|
|
||||||||||||||||||||
|
|
IFRIC 14
|
IAS 19 - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction
|
|
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
|
The adoption of the above interpretations does not have a material impact on the results of the Group. The Group's reportable segments are set out in note 2.
Certain comparative figures have been reclassified to conform with the current year presentation.
|
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
2.
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
2008
|
|
|
|
2007
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
US$m
|
|
|
|
US$m
|
|
|
||||||||
|
|
By business:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
Dairy Farm
|
|
|
|
6,733
|
|
|
|
5,887
|
|
|
|||||||||||||
|
|
Mandarin Oriental
|
|
|
|
530
|
|
|
|
529
|
|
|
|||||||||||||
|
|
Jardine Cycle & Carriage
|
|
|
1,218
|
|
|
|
1,239
|
|
|
||||||||||||||
|
|
Astra
|
|
|
|
|
|
9,974
|
|
|
|
7,673
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
18,455
|
|
|
|
15,328
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
3. |
Net Operating Costs |
|||||||||||||||||||||||
|
2008 |
2007 |
|||||||||||||||||||||||
|
US$m |
US$m |
|||||||||||||||||||||||
|
Cost of sales |
(13,828) |
(11,411) |
||||||||||||||||||||||
|
Other operating income |
198 |
289 |
||||||||||||||||||||||
|
Selling and distribution costs |
(2,078) |
(1,835) |
||||||||||||||||||||||
|
Administration expenses |
(943) |
(843) |
||||||||||||||||||||||
|
Other operating expenses |
(230) |
(44) |
||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
|
(16,881) |
(13,844) |
|||||||||||||||||||||||
|
4. |
Operating Profit |
|||||||||||||||||||||||
|
2008 |
2007 |
|||||||||||||||||||||||
|
US$m |
US$m |
|||||||||||||||||||||||
|
By business: |
||||||||||||||||||||||||
|
Dairy Farm |
387 |
276 |
||||||||||||||||||||||
|
Mandarin Oriental |
82 |
133 |
||||||||||||||||||||||
|
Jardine Cycle & Carriage |
56 |
38 |
||||||||||||||||||||||
|
Astra |
1,108 |
1,034 |
||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
|
1,633 |
1,481 |
|||||||||||||||||||||||
|
Corporate and other interests |
(59) |
4 |
||||||||||||||||||||||
|
Intersegment transactions |
- |
(1) |
||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
|
1,574 |
1,484 |
|||||||||||||||||||||||
|
Operating profit included the following gains/(losses) from non-trading items: |
||||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Increase in fair value of investment properties |
2 |
1 |
||||||||||||||||||||||
|
(Decrease)/increase in fair value of plantations |
(162) |
35 |
||||||||||||||||||||||
|
Sale and closure of businesses |
14 |
17 |
||||||||||||||||||||||
|
Sales of plantations and related assets |
34 |
- |
||||||||||||||||||||||
|
Sale of investments |
1 |
70 |
||||||||||||||||||||||
|
Sale of property interests |
2 |
- |
||||||||||||||||||||||
|
Change in attributable interests in subsidiary undertakings |
- |
2 |
||||||||||||||||||||||
|
Restructuring of businesses |
2 |
(7) |
||||||||||||||||||||||
|
Realization of exchange gains* |
1 |
8 |
||||||||||||||||||||||
|
Discount on acquisition of businesses |
- |
3 |
||||||||||||||||||||||
|
Other |
- |
4 |
||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
|
(106) |
133 |
|||||||||||||||||||||||
|
* |
Arising on repatriation of capital from a foreign subsidiary undertaking. |
|||||||||||||||||||||||
|
5. |
Share of Results of Jardine Matheson |
|||||||||||||||
|
2008 |
2007 |
|||||||||||||||
|
US$m |
US$m |
|||||||||||||||
|
By business: |
||||||||||||||||
|
Jardine Pacific |
60 |
114 |
||||||||||||||
|
Jardine Motors |
21 |
42 |
||||||||||||||
|
Jardine Lloyd Thompson |
20 |
24 |
||||||||||||||
|
Corporate and other interests |
15 |
17 |
||||||||||||||
|
Intersegment transactions |
- |
(8) |
||||||||||||||
|
116 |
189 |
|||||||||||||||
|
Share of results of Jardine Matheson included the following gains/(losses) from non-trading items: |
||||||||||||||||
|
(Decrease)/increase in fair value of investment properties |
(5) |
38 |
||||||||||||||
|
Revaluation of property interests |
(2) |
- |
||||||||||||||
|
Sale and closure of businesses |
2 |
5 |
||||||||||||||
|
Sale of property interests |
2 |
1 |
||||||||||||||
|
Restructuring of businesses |
(1) |
7 |
||||||||||||||
|
Realization of exchange gains* |
- |
4 |
||||||||||||||
|
Value added tax recovery in Jardine Motors |
1 |
5 |
||||||||||||||
|
Other |
- |
(1) |
||||||||||||||
|
|
|
|||||||||||||||
|
(3) |
59 |
|||||||||||||||
|
Results are shown after tax and minority interests in Jardine Matheson. |
||||||||||||||||
|
* |
Arising on repatriation of capital from a foreign subsidiary undertaking. |
|||||||||||||||
|
6. |
Share of Results of Associates and Joint Ventures |
|||||||||||||
|
2008 |
2007 |
|||||||||||||
|
US$m |
US$m |
|||||||||||||
|
By business: |
||||||||||||||
|
Hongkong Land |
25 |
1,342 |
||||||||||||
|
Dairy Farm |
30 |
30 |
||||||||||||
|
Mandarin Oriental |
11 |
23 |
||||||||||||
|
Jardine Cycle & Carriage |
6 |
9 |
||||||||||||
|
Astra |
264 |
116 |
||||||||||||
|
Corporate and other interests |
15 |
6 |
||||||||||||
|
|
|
|||||||||||||
|
351 |
1,526 |
|||||||||||||
|
Share of results of associates and joint ventures included the following gains/(losses) from non-trading items: |
||||||||||||||
|
(Decrease)/increase in fair value of investment properties |
(253) |
1,173 |
||||||||||||
|
Asset impairment |
(5) |
(70) |
||||||||||||
|
Sale and closure of businesses |
2 |
(10) |
||||||||||||
|
Sale of investments |
3 |
2 |
||||||||||||
|
Sale of property interests |
- |
4 |
||||||||||||
|
Change in attributable interests in associates |
101 |
2 |
||||||||||||
|
Deferred tax on franchise rights* |
6 |
- |
||||||||||||
|
|
|
|||||||||||||
|
(146) |
1,101 |
|||||||||||||
|
|
|
|||||||||||||
|
Results are shown after tax and minority interests in the associates and joint ventures. |
||||||||||||||
|
* |
Arising on change in tax rate on deferred tax relating to the valuation of franchise rights on acquisition of Astra. |
|||||||||||||
|
7. |
Tax |
|||||||||||||||||||||
|
2008 |
2007 |
|||||||||||||||||||||
|
US$m |
US$m |
|||||||||||||||||||||
|
Current tax |
(528) |
(382) |
||||||||||||||||||||
|
Deferred tax |
75 |
(10) |
||||||||||||||||||||
|
|
|
|||||||||||||||||||||
|
(453) |
(392) |
|||||||||||||||||||||
|
|
|
|||||||||||||||||||||
|
Greater China |
(41) |
(29) |
||||||||||||||||||||
|
Southeast Asia |
(405) |
(339) |
||||||||||||||||||||
|
United Kingdom |
(9) |
(5) |
||||||||||||||||||||
|
Rest of the world |
2 |
(19) |
||||||||||||||||||||
|
|
|
|
||||||||||||||||||||
|
(453) |
(392) |
|||||||||||||||||||||
|
|
|
|||||||||||||||||||||
|
Tax on profits has been calculated at rates of taxation prevailing in the territories in which the Group operates. |
||||||||||||||||||||||
|
Share of tax of Jardine Matheson of US$12 million (2007: US$34 million) and of associates and joint ventures of US$55 million (2007: US$307 million) are included in share of results of Jardine Matheson and share of results of associates and joint ventures respectively. |
||||||||||||||||||||||
|
8. |
Profit attributable to Shareholders |
|||||||||||||||||||||
|
2008 |
2007 |
|||||||||||||||||||||
|
US$m |
US$m |
|||||||||||||||||||||
|
By business: |
||||||||||||||||||||||
|
Jardine Matheson |
119 |
130 |
||||||||||||||||||||
|
Hongkong Land |
179 |
163 |
||||||||||||||||||||
|
Dairy Farm |
250 |
201 |
||||||||||||||||||||
|
Mandarin Oriental |
52 |
59 |
||||||||||||||||||||
|
Jardine Cycle & Carriage |
29 |
27 |
||||||||||||||||||||
|
Astra |
293 |
222 |
||||||||||||||||||||
|
Corporate and other interests |
(63) |
(79) |
||||||||||||||||||||
|
|
|
|||||||||||||||||||||
|
Underlying profit attributable to shareholders |
859 |
723 |
||||||||||||||||||||
|
(Decrease)/increase in fair value of investment properties (note 10) |
(257) |
1,211 |
||||||||||||||||||||
|
Other non-trading items (note 10) |
90 |
90 |
||||||||||||||||||||
|
|
|
|||||||||||||||||||||
|
Profit attributable to shareholders |
692 |
2,024 |
||||||||||||||||||||
|
9. |
Earnings per Share |
|||||||||||||||
|
Basic earnings per share are calculated on profit attributable to shareholders of US$692 million (2007: US$2,024 million) and on the weighted average number of 618 million (2007: 618 million) shares in issue during the year. |
||||||||||||||||
|
Diluted earnings per share are calculated on profit attributable to shareholders of US$691 million (2007: US$1,973 million), which is after adjusting for the effects of the conversion of dilutive potential ordinary shares of Jardine Matheson, subsidiary undertakings, associates or joint ventures. |
||||||||||||||||
|
The weighted average number of shares is arrived at as follows: |
||||||||||||||||
|
Ordinary shares |
||||||||||||||||
|
in millions |
||||||||||||||||
|
2008 |
2007 |
|||||||||||||||
|
Weighted average number of shares in issue |
1,087 |
1,077 |
||||||||||||||
|
Company's share of shares held by Jardine Matheson |
(469) |
(459) |
||||||||||||||
|
|
|
|||||||||||||||
|
Weighted average number of shares for earnings per share calculation |
618 |
618 |
||||||||||||||
|
Additional basic and diluted earnings per share are also calculated based on underlying profit attributable to shareholders. A reconciliation of earnings is set out below: |
||||||||||||||||
|
2008 |
2007 |
|||||||||||||||
|
Basic |
Diluted |
Basic |
Diluted |
|||||||||||||
|
earnings |
earnings |
earnings |
Earnings |
|||||||||||||
|
per share |
per share |
per share |
per share |
|||||||||||||
|
|
US$m |
US$ |
US$ |
US$m |
US$ |
US$ |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Profit attributable to shareholders |
692 |
1.12 |
1.12 |
2,024 |
3.28 |
3.19 |
||||||||||
|
Non-trading items (note 10) |
167 |
(1,301) |
||||||||||||||
|
|
|
|||||||||||||||
|
|
||||||||||||||||
|
Underlying profit attributable to shareholders |
859 |
1.39 |
1.39 |
723 |
1.17 |
1.17 |
||||||||||
|
10. |
Non-trading Items |
|||||||||||||||
|
Non-trading items are separately identified to provide greater understanding of the Group's underlying business performance. Items classified as non-trading items include fair value gains or losses on revaluation of investment properties and plantations; gains and losses arising from the sale of businesses, investments and properties; impairment of non-depreciable intangible assets and other investments; provisions for the closure of businesses; and other credits and charges of a non-recurring nature that require inclusion in order to provide additional insight into underlying business performance. |
||||||||||||||||
|
An analysis of non-trading items after interest, tax and minority interests is set out below: |
||||||||||||||||
|
2008 |
2007 |
|||||||||||||||
|
US$m |
US$m |
|||||||||||||||
|
|
|
|
|
|
|
|||||||||||
|
(Decrease)/increase in fair value of investment properties |
||||||||||||||||
|
|
|
|
|
|
|
|||||||||||
|
- Hongkong Land |
|
(253) |
|
|
1,173 |
|
||||||||||
|
- Jardine Matheson |
|
(5) |
|
|
38 |
|
||||||||||
|
- other |
|
1 |
|
|
- |
|
||||||||||
|
|
|
|
|
|
|
|||||||||||
|
(257) |
1,211 |
|||||||||||||||
|
(Decrease)/increase in fair value of plantations |
(32) |
6 |
||||||||||||||
|
Asset impairment |
||||||||||||||||
|
|
|
|
|
|
|
|||||||||||
|
- Mandarin Oriental, Kuala Lumpur |
|
- |
|
|
4 |
|
||||||||||
|
- motorcycle franchise rights |
|
- |
|
|
(24) |
|
||||||||||
|
- other |
|
(3) |
|
|
- |
|
||||||||||
|
|
|
|
|
|
|
|||||||||||
|
(3) |
(20) |
|||||||||||||||
|
Revaluation of property interests |
(2) |
- |
||||||||||||||
|
Sale and closure of businesses |
||||||||||||||||
|
|
|
|
|
|
|
|||||||||||
|
- 50% interest in Olive Young |
|
9 |
|
|
- |
|
||||||||||
|
- 25% interest in Mandarin Oriental, New York |
|
- |
|
|
12 |
|
||||||||||
|
- other |
|
4 |
|
|
(7) |
|
||||||||||
|
|
|
|
|
|
|
|||||||||||
|
13 |
5 |
|||||||||||||||
|
Sale of plantations and related assets |
6 |
- |
||||||||||||||
|
Sale of investments |
4 |
71 |
||||||||||||||
|
Sale of property interests |
2 |
5 |
||||||||||||||
|
Change in attributable interests in subsidiary undertakings and associates |
96 |
3 |
||||||||||||||
|
Restructuring of businesses |
||||||||||||||||
|
|
|
|
|
|
|
|||||||||||
|
- SIACI in Jardine Lloyd Thompson |
|
- |
|
|
10 |
|
||||||||||
|
- other |
|
1 |
|
|
(5) |
|
||||||||||
|
|
|
|
|
|
|
|||||||||||
|
1 |
5 |
|||||||||||||||
|
Realization of exchange gains* |
1 |
10 |
||||||||||||||
|
Discount on acquisition of businesses |
- |
1 |
||||||||||||||
|
Value added tax recovery in Jardine Motors |
1 |
5 |
||||||||||||||
|
Deferred tax on franchise rights+ |
3 |
- |
||||||||||||||
|
Other |
- |
(1) |
||||||||||||||
|
|
|
|||||||||||||||
|
(167) |
1,301 |
|||||||||||||||
|
* |
Arising on repatriation of capital from a foreign subsidiary undertaking and from a foreign subsidiary undertaking in Jardine Matheson. |
|||||||||||||||
|
+ |
Arising on change in tax rate on deferred tax relating to the valuation of franchise rights on acquisition of Astra. |
|||||||||||||||
|
11. |
Non-current Assets Classified as Held for Sale |
|||||||||||||
|
The major classes of assets classified as held for sale are set out below: |
||||||||||||||
|
2008 |
2007 |
|||||||||||||
|
US$m |
US$m |
|||||||||||||
|
Intangible assets |
15 |
- |
||||||||||||
|
Tangible assets |
50 |
34 |
||||||||||||
|
Investment properties |
- |
2 |
||||||||||||
|
Associates and joint ventures |
- |
7 |
||||||||||||
|
|
|
|||||||||||||
|
Total assets |
65 |
43 |
||||||||||||
|
At 31st December 2008, the non-current assets classified as held for sale comprise Dairy Farm's interest in two retail properties in Malaysia with a carrying value of US$65 million. |
||||||||||||||
|
At 31st December 2007, the non-current assets classified as held for sale include Dairy Farm's interest in a retail property in Malaysia with a carrying value of US$33 million and its 50% interest in Olive Young with a carrying value of US$7 million. The sale of Olive Young was completed in February 2008 and resulted in a profit before tax of US$14 million. |
||||||||||||||
|
12. |
Shareholders' Funds |
|||||||||||||
|
2008 |
2007 |
|||||||||||||
|
US$m |
US$m |
|||||||||||||
|
At 1st January |
9,787 |
7,627 |
||||||||||||
|
Recognized income and expense attributable to shareholders |
(45) |
2,263 |
||||||||||||
|
Dividends (note 13) |
(112) |
(107) |
||||||||||||
|
Employee share option schemes |
||||||||||||||
|
- value of employee services |
8 |
6 |
||||||||||||
|
Scrip issued in lieu of dividends |
166 |
153 |
||||||||||||
|
Increase in own shares held |
(99) |
(155) |
||||||||||||
|
|
|
|||||||||||||
|
At 31st December |
9,705 |
9,787 |
||||||||||||
|
|
|
|||||||||||||
|
13. |
Dividends |
|||||||||||||
|
2008 |
2007 |
|||||||||||||
|
US$m |
US$m |
|||||||||||||
|
Final dividend in respect of 2007 of US¢ 12.40 (2006: US¢11.70) per share |
134 |
125 |
||||||||||||
|
Interim dividend in respect of 2008 of US¢ 5.90 (2007: US¢5.60) per share |
64 |
61 |
||||||||||||
|
|
|
|||||||||||||
|
198 |
186 |
|||||||||||||
|
|
||||||||||||||
|
Company's share of dividends paid on the shares held by Jardine Matheson |
(86) |
(79) |
||||||||||||
|
|
|
|||||||||||||
|
|
|
|||||||||||||
|
112 |
107 |
|||||||||||||
|
|
|
|||||||||||||
|
A final dividend in respect of 2008 of US¢13.10 (2007: US¢12.40) per share amounting to a total of US$143 million (2007: US$134 million) is proposed by the Board. The dividend proposed will not be accounted for until it has been approved at the Annual General Meeting. The net amount after deducting the Company's share of the dividends payable on the shares held by Jardine Matheson of US$62 million (2007: US$58 million) will be accounted for as an appropriation of revenue reserves in the year ending 31st December 2009. |
||||||||||||||
|
14. |
Notes to Consolidated Cash Flow Statement |
|||||||||||||||||||||||||||||||||
|
2008 |
2007 |
|||||||||||||||||||||||||||||||||
|
(a) |
Purchase of subsidiary undertakings |
US$m |
US$m |
|||||||||||||||||||||||||||||||
|
Intangible assets |
124 |
2 |
||||||||||||||||||||||||||||||||
|
Tangible assets |
226 |
1 |
||||||||||||||||||||||||||||||||
|
Non-current debtors |
|
1 |
1 |
|||||||||||||||||||||||||||||||
|
Current assets |
23 |
9 |
||||||||||||||||||||||||||||||||
|
Long-term borrowings |
(28) |
- |
||||||||||||||||||||||||||||||||
|
Deferred tax liabilities |
(75) |
- |
||||||||||||||||||||||||||||||||
|
Pension liabilities |
- |
(1) |
||||||||||||||||||||||||||||||||
|
Current liabilities |
(19) |
(6) |
||||||||||||||||||||||||||||||||
|
Net assets |
252 |
6 |
||||||||||||||||||||||||||||||||
|
Adjustment for minority interests |
(28) |
(3) |
||||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||||
|
Net assets acquired |
224 |
3 |
||||||||||||||||||||||||||||||||
|
Goodwill |
11 |
4 |
||||||||||||||||||||||||||||||||
|
Total consideration |
235 |
7 |
||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||
|
Adjustment for carrying value of associates and joint ventures |
(26) |
(4) |
||||||||||||||||||||||||||||||||
|
Adjustment for fair value relating to previously held interests |
(10) |
- |
||||||||||||||||||||||||||||||||
|
Cash and cash equivalents of subsidiary undertakings acquired |
(8) |
(2) |
||||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||||
|
Net cash outflow |
191 |
1 |
||||||||||||||||||||||||||||||||
|
Increase in interest in Mandarin Oriental |
2 |
- |
||||||||||||||||||||||||||||||||
|
Increase in interest in Jardine Cycle & Carriage |
137 |
24 |
||||||||||||||||||||||||||||||||
|
Increase in interests in other subsidiary undertakings |
83 |
1 |
||||||||||||||||||||||||||||||||
|
413 |
26 |
|||||||||||||||||||||||||||||||||
|
Net cash outflow in 2008 of US$191 million included US$156 million for PT United Tractors' acquisition of a company which holds coal mining rights in Central Kalimantan and US$24 million for increasing Astra's interest in PT Marga Mandalasekti from 34% to 63%. Increase in interests in other subsidiary undertakings included US$42 million for Dairy Farm's acquisition of an additional interest in PT Hero Supermarket under a put option, and US$20 million and US$21 million for Astra's increased interests in PT Astra Otoparts and PT United Tractors respectively. |
||||||||||||||||||||||||||||||||||
|
(b) |
Purchase of associates and joint ventures in 2008 included US$77 million for Jardine Cycle & Carriage's acquisition of a 20% interest in Truong Hai Automotive Corporation, and US$97 million and US$21 million for the Company's increased interest in Hongkong Land and investment in Jardine Rothschild Asia Capital respectively. Purchase of associates and joint ventures in 2007 included the Company's increased interest in Hongkong Land of US$104 million. |
|||||||||||||||||||||||||||||||||
|
(c) |
Purchase of other investments in 2008 included US$156 million for Astra's purchase of securities, and US$22 million and US$19 million for the Company's purchase of shares in Paris Orléans and bonds in Hongkong Land respectively. Purchase of other investments in 2007 included US$61 million for Astra's purchase of securities. |
|||||||||||||||||||||||||||||||||
|
2008 |
2007 |
|||||||||||||||||||||||||||||||||
|
(d) |
Sale of subsidiary undertakings |
US$m |
US$m |
|||||||||||||||||||||||||||||||
|
Intangible assets |
1 |
- |
||||||||||||||||||||||||||||||||
|
Tangible assets |
4 |
- |
||||||||||||||||||||||||||||||||
|
Associates and joint ventures |
2 |
- |
||||||||||||||||||||||||||||||||
|
Non-current debtors |
2 |
- |
||||||||||||||||||||||||||||||||
|
Deferred tax assets |
4 |
- |
||||||||||||||||||||||||||||||||
|
Current assets |
101 |
- |
||||||||||||||||||||||||||||||||
|
Current liabilities |
(33) |
- |
||||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||||
|
Net assets |
81 |
- |
||||||||||||||||||||||||||||||||
|
Adjustment for minority interests |
(24) |
- |
||||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||||
|
Net assets disposed of |
57 |
- |
||||||||||||||||||||||||||||||||
|
Profit on disposal |
3 |
- |
||||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||||
|
Sale proceeds |
60 |
- |
||||||||||||||||||||||||||||||||
|
Adjustment for carrying value of associates |
||||||||||||||||||||||||||||||||||
|
and joint ventures |
(34) |
- |
||||||||||||||||||||||||||||||||
|
Cash and cash equivalents of subsidiary |
||||||||||||||||||||||||||||||||||
|
undertakings disposed of |
(59) |
- |
||||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||||
|
Net cash outflow |
(33) |
- |
||||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||||
|
Sale proceeds in 2008 of US$60 million included US$48 million from Astra's sale of a 15% interest in PT Pantja Motor which reduced its effective interest from 65% to 50%. |
||||||||||||||||||||||||||||||||||
|
(e) |
Sale of associates and joint ventures in 2008 included US$21 million from Dairy Farm's sale of its 50% interest in Olive Young. Sale of associates and joint ventures in 2007 included US$71 million from Mandarin Oriental's sale of its 25% interest in Mandarin Oriental, New York, and US$12 million and US$15 million from Jardine Cycle & Carriage's sale of its interests in Ampang Investments and UMF respectively. |
|||||||||||||||||||||||||||||||||
|
(f) |
Sale of other investments in 2008 mainy comprised Astra's sale of securities. Sale of other investments in 2007 included US$54 million from the Company's partial disposal of its interest in The Bank of N.T. Butterfield & Son, US$11 million from disposal of shares in CNAC and US$46 million from a capital distribution from Edaran Otomobil Nasional followed by sale of that investment. |
|||||||||||||||||||||||||||||||||
|
15. |
Jardine Strategic Corporate Cash Flow and Net Debt |
|||||||||||||
|
2008 |
2007 |
|||||||||||||
|
US$m |
US$m |
|||||||||||||
|
Dividends receivable |
||||||||||||||
|
|
|
|
|
|
|
|||||||||
|
Subsidiary undertakings |
|
287 |
|
|
350 |
|
||||||||
|
Jardine Matheson |
|
228 |
|
|
197 |
|
||||||||
|
Associates |
|
164 |
|
|
118 |
|
||||||||
|
Other holdings |
|
19 |
|
|
12 |
|
||||||||
|
|
|
|
|
|
|
|||||||||
|
698 |
677 |
|||||||||||||
|
Less taken in scrip |
(148) |
(117) |
||||||||||||
|
550 |
560 |
|||||||||||||
|
Other operating cash flows |
(79) |
(83) |
||||||||||||
|
Cash flows from operating activities |
471 |
477 |
||||||||||||
|
Investing activities |
||||||||||||||
|
|
|
|
|
|
|
|||||||||
|
Purchase of subsidiary undertakings |
|
(139) |
|
|
(24) |
|
||||||||
|
Purchase of associates |
|
(118) |
|
|
(104) |
|
||||||||
|
Purchase of other investments |
|
(47) |
|
|
(18) |
|
||||||||
|
Sale of other investments |
|
- |
|
|
111 |
|
||||||||
|
|
|
|
|
|
|
|||||||||
|
Cash flows from investing activities |
(304) |
(35) |
||||||||||||
|
Financing activities |
||||||||||||||
|
|
|
|
|
|
|
|||||||||
|
Dividends paid by the Company |
|
(32) |
|
|
(33) |
|
||||||||
|
|
|
|
|
|
|
|||||||||
|
Cash flows from financing activities |
(32) |
(33) |
||||||||||||
|
Fair value adjustment on 6.375% Guaranteed Bonds |
(12) |
(15) |
||||||||||||
|
Effect of exchange rate changes |
- |
(2) |
||||||||||||
|
Net decrease in net debt |
123 |
392 |
||||||||||||
|
Net debt at 1st January |
(343) |
(735) |
||||||||||||
|
Net debt at 31st December |
(220) |
(343) |
||||||||||||
|
Represented by: |
||||||||||||||
|
Bank balances and other liquid funds |
74 |
6 |
||||||||||||
|
6.375% Guaranteed Bonds due 2011 |
(294) |
(313) |
||||||||||||
|
Other long-term borrowings |
- |
(36) |
||||||||||||
|
(220) |
(343) |
|||||||||||||
|
16. |
Capital Commitments and Contingent Liabilities |
|||||||||||||||||||
|
2008 |
2007 |
|||||||||||||||||||
|
US$m |
US$m |
|||||||||||||||||||
|
Capital commitments |
469 |
276 |
||||||||||||||||||
|
Various Group companies are involved in litigation arising in the ordinary course of their respective businesses. Having reviewed outstanding claims and taking into account legal advice received, the Directors are of the opinion that adequate provisions have been made in the financial statements. |
||||||||||||||||||||
|
17. |
Post Balance Sheet Event |
|||||||||||||||||||
|
In January 2009, Mandarin Oriental announced that it had entered into an agreement to sell its 50% interest in Mandarin Oriental, Macau for US$90 million. The sale is expected to complete in May 2009 and will result in a profit after tax of approximately US$75 million. |
||||||||||||||||||||
|
18. |
Market Value Basis Net Assets |
||||||||||||||
|
2008 |
2007 |
||||||||||||||
|
US$m |
US$m |
||||||||||||||
|
Jardine Matheson |
1,236 |
1,821 |
|||||||||||||
|
Hongkong Land |
2,738 |
5,342 |
|||||||||||||
|
Dairy Farm |
4,482 |
4,576 |
|||||||||||||
|
Mandarin Oriental |
710 |
1,698 |
|||||||||||||
|
Jardine Cycle & Carriage |
1,604 |
3,406 |
|||||||||||||
|
Other holdings |
691 |
890 |
|||||||||||||
|
Jardine Strategic Corporate |
(201) |
(343) |
|||||||||||||
|
11,260 |
17,390 |
||||||||||||||
|
US$ |
US$ |
||||||||||||||
|
Net asset value per share |
18.15 |
28.22 |
|||||||||||||
|
'Market value basis net assets' are calculated based on the market price of the Company's holding for listed companies, with the exception of the holding in Jardine Matheson which has been calculated by reference to the market value of US$6,151 million (2007: US$9,139 million) less the Company's share of the market value of Jardine Matheson's interest in the Company. For unlisted companies a Directors' valuation has been used. Net asset value per share is calculated on 'Market value basis net assets' of US$11,260 million (2007: US$17,390 million) and on 620 million (2007: 617 million) shares outstanding at the year end which excludes the Company's share of the shares held by Jardine Matheson of 473 million (2007: 466 million) shares. |
|||||||||||||||
|
The final dividend of US¢13.10 per share will be payable on 13th May 2009, subject to approval at the Annual General Meeting to be held on 7th May 2009, to shareholders on the register of members at the close of business on 20th March 2009, and will be available in cash with a scrip alternative. The ex-dividend date will be on 18th March 2009, and the share registers will be closed from 23rd to 27th March 2009, inclusive. Shareholders will receive their cash dividends in United States Dollars, unless they are registered on the Jersey branch register where they will have the option to elect for sterling. These shareholders may make new currency elections for the 2008 final dividend by notifying the United Kingdom transfer agent in writing by 24th April 2009. The sterling equivalent of dividends declared in United States Dollars will be calculated by reference to a rate prevailing on 29th April 2009. Shareholders holding their shares through The Central Depository (Pte) Limited ('CDP') in Singapore will receive United States Dollars unless they elect, through CDP, to receive Singapore Dollars or the scrip alternative. |
|
Jardine Strategic |
||||||||||||||||
|
Jardine Strategic is a holding company which takes long-term strategic investments in multinational businesses, particularly those with an Asian focus, and in other high quality companies with existing or potential links with the Group. Its principal attributable interests are in Jardine Matheson 53%, Hongkong Land 49%, Dairy Farm 78%, Mandarin Oriental 73% and Jardine Cycle & Carriage 68%, which in turn has a 50% interest in Astra. Jardine Strategic is 81%-held by Jardine Matheson. The Company also has a 21% interest in Rothschilds Continuation. The primary share listing of the parent company, Jardine Strategic Holdings Limited, is in London, with secondary listings in Bermuda and Singapore. The Company is incorporated in Bermuda and its interests are managed from Hong Kong by Jardine Matheson Limited. |
||||||||||||||||
|
- end - |
||||||||||||||||
|
For further information, please contact: |
||||||||||||||||
|
Jardine Matheson Limited |
||||||||||||||||
|
James Riley |
(852) 2843 8229 |
|||||||||||||||
|
GolinHarris |
||||||||||||||||
|
Kennes Young |
(852) 2501 7987 |
|||||||||||||||
|
|
||||||||||||||||
|
Full text of the Preliminary Announcement of Results and the Preliminary Financial Statements for the year ended 31st December 2008 can be accessed through the Internet at 'www.jardines.com'. |
||||||||||||||||
Related Shares:
JDS.L