CMB_1993 — Page 9

Chairman's Statement

GROUP RESULTS AND DIVIDENDS

The Board of Directors announces that the audited consolidated profit for the year ended 30th June, 1993 after transfer of HK$13.04 million from the Development Fund in accordance with the Profit Control Scheme amounted to HK$82.16 million compared with HK$654.32 million for the previous year, which included an extraordinary gain of HK$575.05 million in relation to disposals of certain of the Group's leasehold properties.

The Directors will recommend to shareholders at the forthcoming Ordinary Yearly Meeting to be held on 15th December, 1993 the payment of a final dividend of HK$0.70 per share. This, together with the first interim dividend of HK$0.21 per share, a special dividend of HK$0.50 share and a second interim dividend of HK$0.50 per share already paid, will make a total dividend for the

per

of HK$1,91 year per share, compared with HK$4.19 per share for the previous year.

RESULT OF BUS OPERATIONS

Bus fares were increased on 5th April, 1993 to help offset the increases in costs due to inflationary pressures. Despite this increase in fares and the transfer of HK$13.04 million from the Development Fund, mentioned above, the result of bus operations fell short of the Permitted Return under the Public Bus Services Ordinance by HK$0.27 million. Together with the shortfall of HK$6.59 million brought forward from the financial year ended 30th June, 1991 the accumulated shortfall amounts to HK$6.86 million.

TRAFFIC ACTIVITIES AND BUS FLEET

The number of passengers carried during the year under review decreased by 1.4% from 262.3 million to 258.7 million. The kilometres operated amounted to 51.3 million compared with 52.2 million in the previous year. The general shortage of labour continued to hamper the Company in the recruitment of drivers and serious traffic congestion continued to affect the reliability of our services. Both of these features contributed to the reduction in the number of kilometres operated.

This financial year has seen the introduction of three new bus routes. To cater for the increasing development at Siu Sai Wan Route 84M (Siu Sai Wan - Chai Wan MTR) was introduced and a number of service improvements on existing routes were effected to cater for alterations in travel demand. Two new cross-harbour bus routes were also introduced to cater for increasing development in the New Territories. These were Route 680 (Ma On Shan Sheung Wan) and Route 690P (Hang Hau (North) - Central).

In order to meet the rising demand for high quality bus services and to enable a greater number of passengers to enjoy air-conditioned bus services twenty new air-conditioned buses entered operation during the period. These buses have been used to enhance the services to South Horizons, Siu Sai Wan and cross-harbour routes. After the withdrawal of 21 older low capacity buses, the Company's fleet at the end stood at 1,005 buses with a total carrying capacity of 118,553. Of these 83 are air-conditioned buses and, with a further 20 air-conditioned buses out of the 30 buses under construction at the year end, this represents 10% of the total fleet.

FACILITIES FOR PASSENGERS

year

The Company are continuing to construct bus shelters of the new design throughout Hong Kong Island. A list of proposed locations for new bus shelters has been agreed with Transport Department and these will be constructed as part of a rolling programme.

SENIOR CITIZEN CONCESSIONARY FARE SCHEME

On June 6th 1993, the Company introduced a Senior Citizen Concessionary Fare Scheme enabling passengers over 65 years' of age to travel at half fare after 10:00 am on weekdays and all day on Sundays and Public Holidays on most Hong Kong Island Routes. In this connection, the Government offered certain benefits to the Company including the waiving of bus licensing fees and rentals for certain short. term tenancies.

INLAND LOT 5532, TSAT TSE MUI ROAD, AND INLAND LOT 7178, KING'S ROAD, NORTH POINT

The redevelopment of the sites at Tsat Tse Mui Road, North Point and at King's Road, North Point by the joint venture company which is 60 per cent owned by Swire Properties Limited and 40 per cent owned by the Group is in progress and construction work for the foundations has been completed except for a minor portion.

6