MANAGEMENT
DISCUSSION AND ANALYSIS
The following comments should be read in conjunction with the Audited Consolidated Financial Statements of the Company and
the related notes to the financial statements.
REVIEW OF RESULTS
The Group's revenue from continuing and discontinued operations for the year amounted to approximately HK$562 million, representing a decrease of 47% when compared to the previous year. This was mainly attributed to the decrease in the sale of residential units of Metro6 and Green Code.
MATERIAL ACQUISITIONS AND DISPOSALS
During the year under review, the Group disposed of its travel operation business to Miramar Travel Limited, being a related party of the Group. The transaction was completed in October
2016.
During the year, the Group through its 50%/50% joint venture with Empire Group Holdings Limited ("Empire Group") which is owned by Dr. Walter Kwok Ping Sheung successfully awarded a tender for the land at Tuen Mun Town Lot No. 547 located
at Castle Peak Road, Castle Peak Bay, Area 48, Tuen Mun, New Territories at a land premium of HK$2,708.8 million.
In December 2016, the Group entered into a shareholders' agreement with Empire Group to govern the respective rights and obligations of the joint venture company. The entire issued share capital of the joint venture is owned as to 50% by the Group and 50% by Empire Group.
Green Code
LIQUIDITY, FINANCIAL RESOURCES AND CAPITAL STRUCTURE
As of 31 December 2016, shareholders' fund of the Group showed an increase of around 2.4% as compared to the previous year and amounted to approximately HK$5,790 million. The increase was mainly due to the net effect of the profit realised from property sales, the gains on revaluation of the Group's investment properties, impairment loss on securities and the payment of dividends.
There was no change to the capital structure of the Group during the year. Funding for the Group's activities during the year under review was mainly generated from the sale of residential units of Metro6, Green Code and Shining Heights.
Current assets of the Group were recorded at approximately HK$2,333 million and the current liabilities were approximately HK$671 million as of 31 December 2016. Current ratio of the Group had been decreased to 3.5 as at 31 December 2016, mainly attributed to the decrease in cash and bank balances.
GEARING RATIO AND FINANCIAL MANAGEMENT
As there was no borrowing as at 31 December 2016, no gearing ratio, which is calculated on the basis of bank borrowing as a ratio of the Group's shareholders' fund, was shown. Assets of the Group had not been charged to any third parties in the year
under review.
The Group's financing and treasury activities were managed centrally at the corporate level. Financing facilities extended to the Group were denominated in Hong Kong dollar.
EMPLOYEES
As at 31 December 2016, the number of employees of the Group stood at about 210 (2015: about 300). The remuneration packages to employees were commensurable to the market trend and levels of pay in similar industries. A discretionary year-end bonus was paid to employees based on individual performance. Other benefits to employees included medical insurance, retirement scheme, training programmes and educational subsidies. Total employees' costs for the year amounted to approximately HK$95 million, which was commensurate with that recorded in the previous year.
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Hong Kong Ferry (Holdings) Company Limited Annual Report 2016