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1. Premium Land losses fall to less than $26m

1. Premium Land losses fall to less than $26m
Dennis Eng , The Standard 29 December 2003

Real estate developer and trader Premium Land managed to narrow its interim losses by about three-quarters to under HK$26 million compared with a year ago.

``The property markets in both Hong Kong and the PRC were under severe pressure in the first half of 2003 due to the weak economy, the outbreak of Sars and the Iraq war,'' chairman Frederic Dong said.

``The sales of developed properties in Shanghai started generating revenues for the group; however, the results are behind the budget. Keen competition in the building materials industry in Hong Kong renders the operating environment difficult which in turn adversely affected the prices of building materials and renovation services.''

According to a company announcement, turnover for the six months ended September 30 dropped by more than one half to HK$83.9 million compared with last year. Related costs were also about 71 per cent lower at just over HK$60 million. The company's core business of trading in building materials and renovation services accounted for only HK$194,000 of profit in the current period compared with more than HK$4.83 million in 2002. Securities trading and investment was the biggest contributor with more than HK$14 million in earnings despite a 72 per cent plunge in business.

New sources of earnings include the operation of a toll highway, which chipped in HK$1.38 million, while property sales yielded a slight loss of HK$57,000. As a result, the company's operating loss shrank to just over HK$17 million, an 82.63 per cent improvement over the same period last year.

In October, Premium disposed of wholly owned unit Glad and Nice through its subsidiary Huey Tai Holdings for HK$94 million.

The proceeds have been used to help pay off debt of more than HK$344 million. Two weeks ago, Premium also agreed to buy Rich Linker, which owns a property in Beijing. Shares of Premium Land fell 2 per cent close at HK$0.048 on December 24.