2016 — Page 131

1

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

25

CAPITAL AND RESERVES (Continued)

(b)

Share capital

Ordinary shares, issued and fully paid:

At 1 January/31 December

2016

2015

Number of

shares

HK$'000

Number of

shares

356,273,883

HK$'000

1,754,801

356,273,883

1,754,801

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company. All ordinary shares rank equally with regard to the Company's residual

assets.

(c)

(d)

Nature and purpose of reserves

(i)

Securities revaluation reserve

The securities revaluation reserve comprises the cumulative net change in the fair value of available-for-sale securities held at the end of the reporting period and is dealt with in accordance with the accounting policies adopted for the revaluation of securities (see note 1(f)).

(11)

Other capital reserves

The other capital reserves comprise the unrealised profit on inter-company interest capitalised under investment properties.

Distributability of reserves

At 31 December 2016, the aggregate amount of reserves available for distribution to equity shareholders of the Company, as calculated under the provisions of Part 6 of the Hong Kong Companies Ordinance, was HK$571,935,000 (2015: HK$712,675,000). After the end of the reporting period the directors proposed a final dividend of HK26 cents (2015: HK26 cents) per ordinary share, amounting to HK$92,631,000 (2015: HK$92,631,000) (note 10). This dividend has not been recognised as a liability at the end of the reporting period.

(e)

Capital management

The Group's primary objectives when managing capital are to safeguard the Group's ability to continue as a going concern and ensure that it maintains a healthy capital ratio in order to support its business and provide returns for

shareholders.

The Group actively and regularly reviews and manages its capital structure under the policy of prudent financial management. The Group maintains a financially sound capital position and, where appropriate, makes adjustments to it, in light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. No changes were made in the objectives, policies or processes during the years ended 31 December 2016 and 2015.

Neither the Company nor any of its subsidiaries are subject to externally imposed capital requirements.

Hong Kong Ferry (Holdings) Company Limited

Annual Report 2016 129