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67
Cathay Pacific Airways Limited Annual Report 2006
11. Associates
Group Company
2006
HK$M
2005
HK$M
2006
HK$M
2005
HK$M
Hong Kong listed shares at cost (Market value:
HK$13,763 million, 2005: HK$2,716 million) ––6,964 52
Unlisted shares at cost ––17 17
Share of net assets
– listed in Hong Kong 6,705 975 ––
– unlisted 349 755 ––
Goodwill 1,912 –––
8,966 1,730 6,981 69
Less: Impairment loss ––(9) (9)
Loan to an associate –1––
8,966 1,731 6,972 60
Share of profits of associates
– listed 232 170 ––
– unlisted 69 99 ––
301 269 ––
Dividends received and receivable
from associates 241 170 196 63
2006
HK$M
2005
HK$M
Summarised financial information of associates:
Assets 96,009 16,615
Liabilities (55,313) (8,913)
Equity 40,696 7,702
Turnover 11,411 14,092
Profit for the year 1,046 1,101
Under the Restructuring Agreement, the Company subscribed in cash for 1,179,151,364 shares of Air China at an
aggregate subscription price of HK$4,068 million in September 2006. Upon completion of the Restructuring
Agreement, together with the 10% interest previously held as long-term investment, the Company has acquired 17.3%
interest in the share capital of Air China. As the Company has significant influence over Air China by demonstrating
the power to participate in its financial and operating policy decisions, Air China is regarded as an associate.
In respect of the year ended 31st December 2006, Air China was included in the consolidated accounts based on the
most recent available financial statements drawn up to 30th September 2006, but taking into account any changes
in the subsequent period from 1st October 2006 to 31st December 2006 that would materially affect the results.
The Group has taken advantage of the provision contained in HKAS 28 “Investments in Associates” whereby it is
permitted to include the attributable share of associates’ results based on accounts drawn up to a non-coterminous
period end where the difference must be no greater than three months.
Principal associates are listed on page 89.
Notes to the Accounts Balance Sheet