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54 Cathay Pacific Airways Limited Annual Report 2002
22. RESERVES
Group Company
2002 2001 2002 2001
HK$M HK$M HK$M HK$M
Retained profit 23,250 20,541 11,998 10,439
Share premium 7,207 7, 1 6 2 7,207 7, 1 6 2
Capital redemption reserve 21 21 21 21
Investment revaluation reserve 412 306 430 330
Cash flow hedge reserve 559 2,599 697 2,940
Other reserves (1) 13
--
31,448 30,642 20,353 20,892
Included in retained profit is an amount of HK$1,198 million (2001: HK$1,033 million) relating to retained profit
attributable to associated companies.
Investment revaluation reserve relates to changes in the fair value of long-term investments.
Other reserves include the attributable post-acquisition reserves of associated companies capitalised by bonus
issues and exchange differences arising from revaluation of foreign investments.
Cash flow hedge reserve relates to exchange differences on borrowings, lease obligations, currency derivatives
and related security deposits which are arranged in foreign currencies such that repayments can be met by
anticipated operating cash flows.
Exchange differences recorded in the Group cash flow hedge reserve are expected to be credited/(charged) to
operating profit as noted below based on exchange rates ruling at 31st December 2002.
1st half 2nd half Total
HK$M HK$M HK$M
2003 19 67 86
2004 (5) 31 26
2005 267 48 315
2006 54 (35) 19
2007 108 8 116
Beyond 2007 (3)
559
The actual exchange differences ultimately recognised in operating profit will depend upon exchange rates ruling
on the repayment dates of the relevant long-term liabilities and lease obligations.
Notes to the Accounts
-
Balance Sheet