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99
SIA Annual Report 02/03
Notes to the Financial Statements
31 March 2003
23 Long-Term Investments (in $ million)
The Group The Company
31 March 31 March
2003 2002 2003 2002
Quoted investments at cost
Equity investments 51.4 51.4 432.0 432.0
Provision for diminution – – (380.6) (380.6)
51.4 51.4 51.4 51.4
Non-equity investments 372.7 375.6 372.7 375.6
424.1 427.0 424.1 427.0
Unquoted investments at cost
Trade investments 76.1 76.0 48.8 48.2
Non-equity investments 42.4 44.2 42.4 44.2
118.5 120.2 91.2 92.4
Provision for diminution (25.9) (16.5) (25.9) (16.5)
92.6 103.7 65.3 75.9
Long-term loans 52.9 59.7 – –
569.6 590.4 489.4 502.9
Market value of quoted investments
Equity investments 118.1 95.0 118.1 95.0
Non-equity investments 374.2 372.7 374.2 372.7
492.3 467.7 492.3 467.7
The Group The Company
31 March 31 March
2003 2002 2003 2002
Analysis of provision for diminution in value
of quoted and unquoted investments
Balance at 1 April 16.5 15.4 397.1 15.4
Provided during the year 9.4 1.1 9.4 381.7
Balance at 31 March 25.9 16.5 406.5 397.1
In financial year 2001-02, Air New Zealand Limited ("Air NZ") announced the completion of its recapitalization
package, where 2,166,666,667 new ordinary shares and 1,279,866,438 new convertible preference shares were
issued to the Government of New Zealand at NZ$0.27 per share and NZ$0.24 per share respectively. With the
issuance of the new ordinary and preference shares to the Government of New Zealand, the Company’s equity
interest in Air NZ was diluted from 25.0% to 6.47%. Accordingly, the Group reclassified the net carrying amount of
the Air NZ investment from associated company to long-term investments.
Non-equity investments of $415.1 million (2002: $419.8 million) for the Group and the Company relate to interest-
bearing investments with an effective annual interest rate of 1.93% (2001-02: 4.21%).
The Group’s long-term loans comprise:
(a) Loan to August Skyfreighter 1994 Trust of $46.0 million (2002: $48.0 million) is unsecured and bears interest
between 1.74% and 2.30% (2001-02: 2.28% to 4.23%) per annum. The loan is repayable on 28 March 2007;
(b) Loan to Taikoo (Xiamen) Aircraft Engineering Company Limited of US$0.5 million (2002: US$0.5 million) is
unsecured, interest free and is expected to be repayable in 2003-04, subject to further review with the investee
company; and
(c) Shareholders’ loan to Hong Kong Aero Engine Services Limited of US$3.6 million (2002: US$6.0 million of which
US$1.3 million is interest free and US$4.7 million is interest bearing). The loan is unsecured and bears interest
between 1.88% and 2.75% (2001-02: 2.38% and 6.20%) per annum. There is no fixed repayment term, and it
is not expected to be repayable within the next 12 months.