CMB_1997_Copy2 — Page 6

The directors have pleasure in submitting their annual report together with the audited statement of accounts for the year ended 30th June, 1997.

GROUP'S ACTIVITIES

The principal activity of the company and of the group is the operation of franchised public motor buses in Hong Kong. The principal activities of the subsidiaries are set out in note 9 on the accounts.

SUBSIDIARIES

Particulars of the company's subsidiaries at 30th June, 1997 are set out in note 9 on the accounts.

ASSOCIATED COMPANIES

Particulars of the group's associated companies at 30th June, 1997 are set out in note 10 on the accounts.

ACCOUNTS

The profit of the company and of the

group for the year ended 30th June, 1997 and the state of affairs of the company and of the group at that date are set out in the accounts on pages 14 to 30.

A first interim dividend of HK$0.21 per share and a special dividend of HK$1.60 per share were paid on 1st April, 1997. A second interim dividend of HK$0.10 per share and a second special dividend of HK$1.40 per share were paid on 11th August, 1997. The directors now recommend that a final dividend of HK$0.50 per share be paid in respect of the year ended 30th June, 1997, and a special dividend of HK$2.00 per share and that HK$10,000,000 be transferred to general reserve.

CHARITABLE DONATIONS

Donations made by the group during the year amounted to HK$15,700 (1996: HK$24,000).

FIXED ASSETS

Movements in fixed assets during the year are set out in note 8 on the accounts.

During the year, the company has added 44 new buses to the company's bus fleet and there were an additional 10 new buses under construction at 30th June, 1997 and has disposed of 49 old buses.

DIRECTORS

The directors during the year are given on page 2 and further information regarding directors is given on page 11.

In accordance with articles 120A and 122 of the company's articles of association, Madam Ngan Kit-ling, Dr. Henry Ngan, Messrs. Liu Lit-mo, D.A. Leslie Wright and Fritz Helmreich retire from the board and, being eligible, offer themselves for re-election.

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