Harmony Asset Limited
TSX : HAR

Harmony Asset Limited

November 12, 2010 14:58 ET

Harmony Asset Limited: Third Quarter Results Announcement for the Nine Months Ended 30th September, 2010

HONG KONG, CHINA and TORONTO, ONTARIO--(Marketwire - Nov. 12, 2010) - Harmony Asset Limited (the "Company") (Incorporated in the Cayman Islands with limited liability) (TSX:HAR)(HKEX:428) -

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

This announcement is made by Harmony Asset Limited (the "Company") to comply with Canadian securities law and Toronto Stock Exchange requirements.

The financial data for the nine months ended 30th September, 2010 are based on the internal records and management accounts of the Company and its wholly owned subsidiaries (the "Group"). The financial data and statements have not been audited, reviewed or otherwise verified for accuracy and completeness of information by the auditor of the Company.

The Company's shareholders and potential investors are urged to exercise caution in dealing in the shares of the Company and should consult their own professional advisers if they are in doubt as to their investment position.

FINANCIAL HIGHLIGHTS

The financial highlights of the Group for the nine months ended 30th September, 2010 are summarized as follows:

  • Turnover, other revenue and other gains and losses of the Group for the nine months ended 30th September, 2010 were aggregated resulting in a gain of HK$46,073,785 as compared to HK$107,309,912 in the same period last year, representing a 57% decrease.

  • Profit attributable to owners of the Company for the three months ended 30th September, 2010 was HK$14,334,295 (2009: loss of HK$15,816,991).

  • Profit attributable to owners of the Company for the nine months ended 30th September, 2010 was HK$36,075,021 as compared to HK$77,512,813 in the same period last year, representing a 53% decrease.

  • Basic earnings per share of the Group was HK cents 36.70 for the three months ended 30th September, 2010 (2009: basic loss of HK cents 40.52 per share).

  • Basic earnings per share of the Group was HK cents 92.36 for the nine months ended 30th September, 2010 as compared to HK cents 198.69 in the same period last year, representing a 54% decrease.

The Board of Directors (the "Board") of the Company presents the unaudited, condensed, consolidated results of the Group for the nine months ended 30th September, 2010 with comparative figures for the corresponding period in 2009 as follows:

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the nine months ended 30th September, 2010
 
  Three months ended   Nine months ended  
  30th September,   30th September,  
  2010   2009   2010   2009  
  (Unaudited)   (Unaudited)   (Unaudited)   (Unaudited)  
  HK$   HK$   HK$   HK$  
                 
Turnover 27,845,200   812,693   36,973,204   5,562,492  
Other revenue 30,000   2,999,333   90,005   3,132,452  
Other gains (losses) (10,319,887 ) (14,554,878 ) 9,010,576   98,614,968  
   
  17,555,313   (10,742,852 ) 46,073,785   107,309,912  
                 
Employee benefits expenses (567,138 ) (557,502 ) (1,839,062 ) (1,874,460 )
Depreciation of property, plant and equipment (79,016 ) (7,016 ) (237,449 ) (60,574 )
Other operating expenses (2,277,920 ) (5,580,697 ) (7,457,692 ) (12,755,170 )
   
Profit (loss) before income tax 14,631,239   (16,888,067 ) 36,539,582   92,619,708  
                 
Income tax (expenses) credit (296,944 ) 1,071,076   (464,561 ) (15,106,895 )
   
Profit (loss) for the period attributable to owners of the Company 14,334,295   (15,816,991 ) 36,075,021   77,512,813  
   
Other comprehensive income:                
Gains (losses) on fair value changes on available-for-sale financial assets (18,630,397 ) (318,236 ) (2,599,044 ) 51,070  
Transfer to profit or loss upon disposals of available-for-sale financial assets (2,514,580 )   (14,015,560 )  
   
  (21,144,977 ) (318,236 ) (16,614,604 ) 51,070  
   
Total comprehensive income for the period attributable to owners of the Company (6,810,682 ) (16,135,227 ) 19,460,417   77,563,883  
  HK cents   HK cents   HK cents   HK cents  
Earnings (loss) per share                
  Basic1 36.70   (40.52 ) 92.36   198.69  
  Diluted2 36.70   N/A   92.36   198.52  
  1. Basic earnings (loss) per share is calculated by dividing the profit (loss) attributable to owners of the Company by the weighted average number of the ordinary shares in issue during the period.

  2. Diluted earnings per share is calculated same as basic earnings per share as the effect of the assumed conversion of the outstanding share options is anti-dilutive.

 
 
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30th September, 2010 and 31st December, 2009
 
    30th September,   31st December,
    2010   2009
    (Unaudited)   (Audited)
    HK$   HK$
 
Non-current assets        
Property, plant and equipment   1,227,713   1,465,162
Available-for-sale financial assets   48,858,468   110,854,493
Loans and receivables   24,000,779   6,314,135
 
    74,086,960   118,633,790
 
Current assets        
Accounts receivable and prepayments   75,896,685   17,810,465
Trading securities   66,762,120   44,930,302
Derivative financial instruments     21,322,735
Bank balances and cash   98,046,292   98,065,356
 
    240,705,097   182,128,858
 
Current liabilities        
Accounts payable and accruals   5,289,196   1,249,956
Amount due to a related company     6,028,948
Tax payable   16,447,711   13,569,202
 
    21,736,907   20,848,106
 
Net current assets   218,968,190   161,280,752
 
Total assets less current liabilities   293,055,150   279,914,542
 
Non-current liabilities        
Deferred tax liabilities     2,413,948
 
Net assets   293,055,150   277,500,594
 
 
Capital and reserves        
Share capital   39,058,615   39,058,615
Reserves   253,996,535   238,441,979
 
    293,055,150   277,500,594

The accounting policies adopted to prepare the financial statements for the nine months ended 30th September, 2010 are consistent with those used in the annual consolidated financial statements of the Group for the year ended 31st December, 2009.

The financial statements for the nine months ended 30th September, 2010 are unaudited and based on the internal records and management accounts of the Group.

OVERALL PERFORMANCE

For the nine months ended 30th September, 2010, the Group recorded a turnover of HK$36,973,204 as compared to HK$5,562,492 in the same period of the prior year, representing a 565% increase. Income from interest amounted to HK$4,469,453 (2009: HK$926,492). Dividend received from listed and unlisted investments was HK$32,503,751 (2009: HK$4,636,000). Gains on disposal of listed investments amounted to HK$13,005,508 (2009: HK$105,418,596). With the impact of general downturn of global stock markets in the second quarter of 2010, the prices of certain listed shares were lagging. The Group recorded a net unrealized loss of HK$14,925,737 (2009: net unrealized gain of HK$19,782,881) on its publicly traded securities. In addition, the Group recorded an unrealized gain of HK$6,991,713 on the derivative financial instruments during the interim period. The Group disposed some of the private investments resulting in a net realized gain of HK$14,015,560 for the nine months ended 30th September, 2010.

The profit before income tax was HK$36,539,582 as compared to HK$92,619,708 in the same period of the prior year, representing a 61% decrease. Such decrease was due to exceptional increase of the prices of the particular shares in 2009 that we held in the previous year. We took advantage of upside and realised a strong gain last year. The profit attributable to owners of the Company was HK$36,075,021 as compared to HK$77,512,813 in the prior period, representing a 53% decrease.

CAUTION STATEMENT

The Company's shareholders and potential investors should note that all the figures contained herein are unaudited. Accordingly, figures contained in this announcement should in no way be regarded as any assurance on the financial results of the Group for the period ended 30th September, 2010 and the financial position as at 30th September, 2010.

The Company's shareholders and potential investors are urged to exercise caution in dealing in the shares of the Company and consult their own professional advisers if they are in doubt as to their investment position.

By Order of the Board
LEE Fong Lit David
Chairman

Hong Kong, 12th November, 2010

As at the date of this announcement, the Board comprises 4 executive directors, namely, Mr. LEE Fong Lit David, Dr. CHOW Pok Yu Augustine, Dr. LAM Andy Siu Wing JP, Mr. CHAN Shuen Chuen Joseph and 3 independent non-executive directors, namely, Mr. TONG Kim Weng Kelly, Dr. WONG Yun Kuen and Mr. HO Man Kai Anthony.

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