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23. Reserves
Group Company
2009
HK$M
2008
(restated)
HK$M
2007
(restated)
HK$M
2009
HK$M
2008
(restated)
HK$M
2007
(restated)
HK$M
Retained profit 24,704 20,010 31,293 15,685 8,018 16,282
Share premium 16,295 16,287 16,272 16,295 16,287 16,272
Investment revaluation reserve 1,117 638 1,068 1,005 593 876
Cash flow hedge reserve (1,383) (1,712) (677) (1,244) (1,666) (544)
Capital redemption reserve and others 718 699 327 23 23 21
41,451 35,922 48,283 31,764 23,255 32,907
Investment revaluation reserve relates to changes in the fair value of long-term investments.
Capital redemption reserve and others of the Group mainly include the capital redemption reserve of HK$24 million
(2008: HK$24 million), exchange differences arising from revaluation of foreign investments amounted to
HK$1,145 million (2008: HK$1,137 million) and share of associate’s other negative reserve of HK$474 million
(2008: HK$485 million).
The cash flow hedge reserve relates to the effective portion of the cumulative net change in fair values of hedging
instruments and exchange differences on borrowings and lease obligations which are arranged in foreign currencies
such that repayments can be met by anticipated operating cash flows.
The amount transferred from the cash flow hedge reserve to the following profit and loss items was as follows:
2009
HK$M
2008
HK$M
Turnover (94) (468)
Fuel (192) 382
Others (46) (47)
Finance income (28) 1
Net loss transferred to the profit and loss (360) (132)
The cash flow hedge reserve is expected to be charged to operating profit/loss as noted below when the hedged
transactions affect the profit and loss.
Total
HK$M
2010 788
2011 254
2012 127
2013 70
2014 56
Beyond 2014 88
1,383
The actual amount ultimately recognised in operating profit/loss will depend upon the fair values of the hedging
instruments at the time that the hedged transactions affect the profit and loss.
Notes to the Accounts STATEMENT OF FINANCIAL POSITION
Cathay Pacific Airways Limited Annual Report 2009 79