Half Yearly Report

RNS Number : 6888M

Aseana Properties Limited

29 August 2013

 



29 August 2013

Aseana Properties Limited
("Aseana" or the "Company")

Half-Year Results for the Six Months Ended 30 June 2013

Aseana Properties Limited (LSE: ASPL), a property developer investing in Malaysia and Vietnam, listed on the Main Market of the London Stock Exchange, announces its half-year results for the six-month period ended 30 June 2013.

Financial highlights:

·     Unaudited revenue of US$10.22 million for the six-month period ended 30 June 2013 (30 June 2012 (unaudited): US$18.52 million)

·     Unaudited loss before tax for the six-month period ended 30 June 2013 of US$13.73 million (30 June 2012 (unaudited): loss of US$2.34 million)

·     Unaudited loss after tax for the six-month period ended 30 June 2013 of US$14.44 million (30 June 2012 (unaudited): loss of US$3.11 million)

·     Loss on foreign currency translation differences for foreign operations of US$3.50 million (30 June 2012 (unaudited): loss of US$0.18 million)**

·     Unaudited consolidated comprehensive expense of US$13.57 million for the six months period ended 30 June 2013 (30 June 2012 (unaudited): expense of US$3.29 million)

·     Unaudited net asset value of US$170.92 million at 30 June 2013 (31 December 2012 (audited): US$183.58 million) or US$0.806 per share* (31 December 2012 (audited): US$0.866 per share)

·     Unaudited realisable net asset value of US$281.07 million at 30 June 2013 (31 December 2012 (unaudited): US$244.84 million) or US$1.326 per share* (31 December 2012 (unaudited): US$1.155 per share)

Operational highlights:

·     Sale of SENI Mont' Kiara is progressing well achieving 80% sales to date.

·     The RuMa Hotel and Residences ("The RuMa") achieved 22% sales based on sales and purchase agreement signed with a total sales value of about US$49.67 million.

·     The Aloft Kuala Lumpur Sentral Hotel ("Aloft") commenced business on 22 March 2013,  with occupancy improving progressively since opening and reaching 56% in July 2013.

·     The Four Points by Sheraton Sandakan Hotel recorded an improved occupancy rate of 33% in July 2013.

·     The City International Hospital ("CIH") has successfully obtained its operating license on 31 May 2013 from Vietnam's Ministry of Health ("MOH) and commencement of operation is planned for September 2013.

·     Two plots of land in International Hi-Tech Healthcare Park ("IHTHP") were sold with proceeds collected in July 2013 amounting to US$7.4 million.  The sale price is in line with the ascribed valuation in the RNAV figures.

·     Nam Long's share price improved to VND23,000 per share on 28 August 2013 compared to carrying value of VND16,800 per share. Aseana holds approximately 15.58 million shares representing 16.3% of total outstanding shares of Nam Long.

* NAV per share and RNAV per share as at 30 June 2013 are calculated based on 212,025,000 voting shares (31 December 2012: 212,025,000 voting shares).

** Exchange rate - 30 June 2013: US$1:RM3.1606; US$1:VND21,170; 31 December 2012: US$1:RM3.0581; US$1:VND20,840

Commenting on the results, Mohammed Azlan Hashim, Chairman of Aseana, said:

"The property markets and economic conditions in both Malaysia and Vietnam continue to be challenging as reflected in the H1 2013 results. Nonetheless the Company maintains its focus to ensure that the performance of a number of key operating assets within the Group continues to be on the right path for eventual sale, as well as continuing its efforts to convert sales bookings of The RuMa Hotel and Residences and SENI Mont Kiara into contract of sales."

The Company has also published its Quarterly Investment Update (including updates on projects and RNAV figures) for the period to 30 June 2013, which can be obtained on its website at www.aseanaproperties.com/quarterly.htm.

For further information:

Aseana Properties Limited	Tel: [phone]
Chan Chee Kian	Email: [e-mail]
Murphy Richards Capital LLP	Tel: [phone]
Paul Richards / Rachel Rees	Email: [e-mail]
N+1 Singer	Tel: [phone]
James Maxwell (Corporate Finance) /Sam Greatrex (Sales)	Email: [e-mail]  /[e-mail]
Tavistock Communications	Tel: [phone]
Jeremy Carey / James Verstringhe	Email: [e-mail]

Notes to Editors:

London-listed Aseana Properties Limited (LSE: ASPL) is a property developer investing in Malaysia and Vietnam.

Ireka Development Management Sdn Bhd ("IDM") is the exclusive Development Manager for Aseana. It is a wholly-owned subsidiary of Ireka Corporation Berhad, a company listed on the Bursa Malaysia since 1993, which has over 40 years' experience in construction and property development. IDM is responsible for the day-to-day management of Aseana's property portfolio and the introduction and facilitation of new investment opportunities.

CHAIRMAN'S STATEMENT

Introduction

I am pleased to report on the half-year results for Aseana Properties Limited ("Aseana") and its group of companies ("the Group") for the six months ended 30 June 2013. 

During the first half of 2013, the global economy was on an uneven and hesitant recovery path.  Growth in the Euro region remained weak, whilst the pace of growth in the Asian region has also been slower than expected. 

In Malaysia, the domestic economy demonstrated resilience supported by strong growth in both private and public investment.  The business environment had shown signs of a gradual recovery in business investment post-election, with progress in the implementation of long gestation infrastructure related projects.  The government continues to introduce and implement new measures to stabilise the property market to ensure sustainable growth over a longer period. 

The economy in Vietnam edged towards slow recovery since the beginning of the year.  However, it still faces difficulties due to a weak banking system that is limiting growth of many businesses.  On a positive note, the stabilization efforts by the government including numerous interest rate reductions combined with an influx of foreign direct investments over the past 6 months have positioned Vietnam's economy on a recovery path.

Results

For the six months ended 30 June 2013, Aseana and its group of companies (the "Group") recorded unaudited revenue of US$10.22 million (H1 2012 (unaudited): US$18.52 million), which was mainly attributable to the sale of completed units in SENI Mont' Kiara. No revenue was recognised for The RuMa, in accordance with IFRIC 15 - Agreements for Construction of Real Estate which prescribes that revenue be recognised only when the properties are completed and occupancy permits are issued.

The Group recorded an unaudited loss before tax for the period of US$13.73 million (H1 2012 (unaudited): loss of US$2.34 million).  Operating losses of Four Points by Sheraton Sandakan hotel and Harbour Mall Sandakan, together with the pre-opening expenses and operating loss of Aloft Kuala Lumpur Sentral Hotel contributed US$5.96 million to the loss.  The results have also included a share of the losses of associate of US$3.03 million attributed to the financing charges incurred in relation to the Sentral office towers following the completion of the towers.

The Group recorded unaudited consolidated comprehensive expense of US$13.57 million for the six months period ended 30 June 2013 (30 June 2012 (unaudited): expense of US$3.29 million).  This has included an increase in the fair value of the share investment in Nam Long Investment Corporation of US$4.36 million and a foreign currency translation loss of US$3.50 million arising from a strengthening of US Dollars against Ringgit. 

Unaudited net asset value for the Group for the period under review decreased to US$170.92 million (31 December 2012 (audited): US$183.58 million) or US$0.806 per share (31 December 2012: US$0.866 per share) due to losses incurred for the year.  However, unaudited realisable net asset value improved to  US$281.07 million at 30 June 2013 (31 December 2012 (unaudited): US$244.84 million) or US$1.326 per share (31 December 2012 (unaudited): US$1.155 per share). 

Review of Activities and Property Portfolio

Sales status (based on Sales and Purchase agreements signed):

Projects	% sales as at 15 August 2013	% sales as at December 2012
Tiffani by i-ZEN	96.5%	96%
SENI Mont' Kiara
-       Proceeds received	78%	76%
-       Pending completion	2%	3%
The RuMa Hotel and Residences	22%	NA
Kuala Lumpur Sentral Office Towers & Hotel	100%	100%

Malaysia

The RuMa Hotel and Residences is progressing well since commencement of sale in March 2013.  The RuMa has achieved 20% sales based on sales and purchase agreements signed at the end of July 2013.  Sales booking is also encouraging and the Manager is working to convert the bookings into contract of sales.  Numerous marketing events were held to-date in major cities within Asia - Kuala Lumpur, Singapore, Hong Kong, Taiwan and Shanghai.  On site, piling works for The RuMa started in February 2013 and are expected to complete in September 2013.  Construction of the main building works is planned for October 2013.

Stricter lending conditions by the banks in Malaysia have continued to affect the sales performance of SENI Mont' Kiara, which consists of larger residential units.  SENI Mont' Kiara recorded 80% sales as at July 2013, compared to 79% reported in May 2013.  The Manager continues to explore all opportunities to drive sales at SENI Mont' Kiara.

The 482-room Aloft Kuala Lumpur Sentral Hotel ("Aloft"), managed and operated by Starwood Asia Pacific Hotels Resort Pte. Ltd, has achieved occupancy rate of 56% in July 2013 since its opening in March 2013.  Over the next year, Aloft will continue to build up its occupancy rates and improve room rates in order to achieve stabilisation levels.

In Sandakan, the business environment has remained uncertain for a good part of the year, due to an incursion by a small group of armed dissidents in Sabah, until Malaysian security forces successfully overcame them in March 2013.  Travel advisory notices from United Kingdom and Australia were lifted in July 2013, but those from US, Canada and New Zealand still remain in place.  To-date, Harbour Mall Sandakan is 40.8% tenanted, a slight decrease compared to May 2013 due to termination of two tenancy agreements.  On a positive note, The Manager is currently concluding a number of new tenancies which will increase the tenancy rate of the Mall to 45% over the next 3 months.  The Four Points by Sheraton Sandakan Hotel recorded an improved occupancy rate of 33% in July 2013, against year-to-date of 26% as at May 2013.

The remaining of the year will be a busy period for Aseana as it focuses on the operation and performance of key operating assets.  The Company will also continue to focus on realising the remaining units at SENI Mont' Kiara and to drive new sales for The RuMa.

Vietnam

CIH, the maiden project at the International Hi-Tech Healthcare Park, Ho Chi Minh City, was completed in March 2013.  Testing and commissioning of all hospital facilities and medical equipment are on-going.  The hospital has successfully obtained its operating license on 31 May 2013 from Vietnam's Ministry of Health and is expected to commence operation in September 2013.

In addition, the Group has also successfully sold and collected proceeds for two plots of land within the IHTHP for a total of US$7.4 million (VND 155 billion) in July 2013.  The sale price is in line with the ascribed valuation in the RNAV figures.  The proceeds from the sale went towards the repayment of a bank loan and for working capital purposes.

Nam Long share price improved to VND23,000 per share on 28 August 2013 compared to carrying value of VND16,800 per share. Aseana holds approximately 15.58 million shares representing 16.3% of total outstanding shares of Nam Long.

MOHAMMED AZLAN HASHIM

Chairman

28 August 2013

DEVELOPMENT MANAGER'S REVIEW

Malaysia Economic Update

Malaysia's economy in the first and second quarter of 2013 grew at 4.1% and 4.3% year-on-year ("y-o-y") respectively compared to a GDP growth of 6.5% y-o-y in the fourth quarter of 2012 as the challenging external conditions remain a drag to domestic economic activity.

For the first half of 2013, exports declined by 3.8% to RM337.82 billion compared to first half of 2012 while imports expanded 4.4% to RM313.23 billion in the same period, however a balance of trade surplus of RM24.59 billion was recorded.  Exports shrank by 6.9% on a year-on-year basis as shipments of electronics and palm oil remained sluggish.  The annual contraction in export is also largely due to slower demand from China, United States and Japan. 

In July 2013, Fitch Ratings had downgraded Malaysia's economic outlook from "stable" to "negative". Following that, in August 2013 the Malaysian Government has revised downwards the overall GDP growth target for Malaysia in 2013 to 4.5% - 5.0% from its earlier target of 5.0% - 6.0%.  The GDP growth in 2013 will be largely driven by government support, private consumption, private investment and public expenditure.  Firm  domestic activity is also expected to be the main driver of the growth, with the Economic Transformation Programme ("ETP") and Government Transformation Programme ("GTP") continuing to be the main catalyst. To date, the Government has unveiled 161 projects under the ETP with investments totaling RM209.78 billion (US$66.37 billion).

Ringgit Malaysia sank to a three-year low having depreciated against the US dollar by 8.1% since May 2013.  The weakening ringgit was a result of ongoing capital outflow from emerging economies in anticipation of a retraction in US Federal Reserve stimulus program, coupled with the consequential effect of a slower Malaysian economy.

The Central Bank of Malaysia held the overnight policy rate at 3.0% for the 14^th consecutive month in view of low inflation rate at 1.6% in the first half of the year and the weaker global environment.

The Consumer Sentiment Index and the Business Conditions Index issued by the Malaysian Institute of Economic Research ("MIER") for the second quarter of 2013 show that consumer and business confidence indices are moving in opposite directions again.  The Business Conditions Index increased significantly by 21.6 points to 114.2 points (Q1 2013: 92.6 points) attributed to increased sales, higher production and higher local sales expectations over the next three months.  On the other hand, the Consumer Sentiment Index declined by 13.2 points to 109.7 points (Q1 2013: 122.9 points) due to worsening inflationary expectations and gloomier financial as well as job outlooks.

Overview of Property Market in Klang Valley, Malaysia Offices § 2 new office buildings were completed in Q2 2013 increasing the total supply of office space in the Klang Valley to 101.9 million sq ft. Overall occupancy rate remained at 79%. § Market rentals and prices remained stable, while rental yield remained at between 6% and 8%. § En-bloc transaction during the quarter: (i) Tower 7, Avenue 3 (prime B 11-storey) located at Bangsar South were sold at a price of RM894 psf (US$283 psf); (ii) Block H, Oasis Square located at Jalan Lapangan Terbang (Prime B 12-storey) were sold at a price of RM650 psf (US$206 psf). § Occupancy rates are expected to decline in second half of 2013 as another 5.73 million sq. ft. of office space is scheduled to complete by end 2013. Retail § Market rental rates and market prices increased on the upper end of the price range for all grades of retail centres located in Klang Valley.  § Average occupancy rate in Klang Valley increased to 87.2% in Q2 2013 (Q1 2013: 86.9%). § 4 retail centres with a total of 0.51 million sq. ft. were completed in Q2 2013. Residential § 8 projects with 2,697 units of condominiums in Klang Valley were completed in Q2 2013. § Market prices and market rental rates remained stable in Q2 2013 with a few high end condominiums facing downward pressure on rental rates. § Selected new launches: (i) M City - Block 3 (544 units), launched in May 2013 with an average price of RM1,400 psf (US$443 psf) is 60% sold. (ii) Tropicana Gardens - Bayberry Residence (413 units), launched in March 2013 with an average price of RM1,100 psf (US$348 psf) achieved 80% take-up rate. Hospitality § In Q2 2013, average daily room rate for International class hotels in the Klang Valley (within Kuala Lumpur City) increased y-o-y by 0.3% and Business class hotels increased y-o-y by 1.5%. § Average occupancy rate in Q2 2013 is recorded at 67.9% (Q1 2013: 64.5%). § 6.4 million international tourist arrivals in Malaysia in Q1 2013 (15.9% increase compared to Q1 2012).

Source: Bank Negara Malaysia website, Jones Lang Wootton Q2 report, MIER, various publications

Exchange rate - 30 June 2013: US$1:RM3.1606

Vietnam Economic Update

Vietnam has experienced the longest period of slow growth since the economic reforms in the late 1980s.  Nonetheless, General Statistics Office ("GSO") of Vietnam states that economic performance improved in the first half of 2013.  Measures set out by the government including resolving bad debts, stimulating demand and reducing inventories have helped in stabilising the macroeconomy and sustain moderate growth.  Vietnam's GDP achieved a growth of 4.9% from 4.4% in 1H 2012.  The Vietnamese Government forecasted a growth for 2013 of 5.5% and strives for annual growth of 6% in 2014 that will be predicated on the ability to boost foreign direct investment and control the non-performing loans situation.

Vietnam's June 2013 CPI rose 2.4% from December 2012, which was much lower than the half-year target of 6.81% set for 2013 by the National Assembly.  The low six-month CPI is a result of effective controls implemented by the government since the beginning of year 2012 which include credit tightening measures to real estate sector, share trading activities, and limiting the convertibility and trading of gold.

The government has been seen to be more proactive in the first half of the year in reviving the Vietnamese economy and most notably, the real estate market.  One of the initiatives taken was the setting-up of Vietnam Asset Management Company ("VAMC") to address nearly US$5 billion of non-performing loans and to promote credit growth in the banking system.  Furthermore, the SBV allocated VND30 trillion (US$1.43 billion) under the new regulation for preferential home loans at an interest rate of 6% per annum for low income earners.  In an attempt to bolster businesses and encourage investments to revive the economy, The National Assembly of Vietnam has approved reductions in Vietnam's corporate tax rates from 25% to 22% beginning 1 January 2014, and to 20% from 1 January 2016.  The rate for companies with fewer than 200 employees and total revenue of less than VND20 billion will be lowered to 20% from 1 July 2013 and to 17% from 1 January 2016.

Despite the signs of recovery, Vietnam's economy is still facing challenges due to weak domestic demand and high cost of production.

Overview of Property Market in Vietnam Offices § 3 Grade C office buildings were completed in Q2 2013 increasing the total supply of office space to over 1.3 million sqm by 1% q-o-q and 8% y-o-y. § Overall occupancy rate remained stable at 87% despite the decrease in average rent of 1% q-o-q and 7% y-o-y. § Demand increased by 16% y-o-y contributed by strong take-up rates for Grade A and Grade C buildings.  Offices located in CBD are preferred by tenants with take-up rates more than 360% higher than those non-CBD offices. Retail § HCMC retail stock declined by 2.4% q-o-q mainly due to closing of 3 shopping centres. § The stock of retail podiums, department stores and wholesale markets remained constant in Q2 2013 compared to Q1 2013. § Retail rental rates increased by 7% q-o-q whilst average occupancy rose slightly by 1% q-o-q mainly due to the closing of poor performers during the quarter. Residential § New launches for apartments decreased slightly by 3.9% q-o-q but increased by 11% y-o-y.  The apartments absorption rate increased by 1% q-o-q to 8% focusing on Grade C apartments with average prices ranging from VND10 million psm to VND15 million psm (US$472 psm - US$709 psm). § The affordable segment of apartments for sales is in demand currently with the unit size ranging from 70 sqm to 90 sqm. § Phase 2 of My Phu 3 project was launched in Q2 2013 for villa market; whilst the Hoja Villa project, a land plot project was converted into a townhouse project in Q2 2013. § The villa/townhouse market's absorption rate increased to 18% in Q2 2013 compared to 5% in Q1 2013 with developers offering discounts up to 40% of selling prices in order to push sales. High-end villas/townhouses transactions were mainly from Phu My Hung area in Q2 2013. Hospitality § 1 new 3-star hotel (60 rooms) and 1 existing 5-star hotel with additional 100 rooms were opened in Q2 2013 increasing the stock by 1% q-o-q and 7% y-o-y. § Average room rate dropped 2% q-o-q and 12% y-o-y to US$84 per room per night whilst occupancy rate declined by 13% q-o-q to 62% due to low season in Q2 2013. § There were no new launches in the Serviced apartment segment. Average occupancy rate increased by 1% q-o-q to 79% while average rental rate remained stable.

Source: General Statistics Office of Vietnam, Savills, CBRE, various publications

Exchange rate - 30 June 2013: US$1:VND21,170

LAI VOON HON

President / Chief Executive Officer

Ireka Development Management Sdn. Bhd.

Development Manager

28 August 2013

PROPERTY PORTFOLIO AS AT 30 JUNE 2013

Project	Type	Effective Ownership	Approx. Gross  Floor Area (sq m)	Approx. Land Area (sq m)	Scheduled completion
Completed projects
Tiffani by i-ZEN Kuala Lumpur, Malaysia	Luxury condominiums	100%	81,000	15,000	Completed August 2009
SENI Mont' Kiara Kuala Lumpur, Malaysia	Luxury condominiums	100%	225,000	36,000	Phase 1: Completed April 2011 Phase 2: Completed October 2011
Sandakan Harbour Square Sandakan, Sabah, Malaysia	Retail lots, hotel and retail mall	100%	126,000	48,000	Retail lots Completed 2009 Retail mall: Completed March 2012 Hotel: Completed May 2012
Projects under development
Kuala Lumpur Sentral Office Towers & Hotel Kuala Lumpur, Malaysia	Office towers and a business hotel	40%	107,000	8,000	Office Towers: Completed December 2012 Hotel: January 2013
Aloft Kuala Lumpur Sentral hotel Kuala Lumpur, Malaysia	Business-class hotel (a Starwood Hotel)	100%	28,000	5,000	March 2013
Phase 1: City International Hospital, International Hi-tech Healthcare Park, Ho Chi Minh City, Vietnam	Private general hospital	66.8%	48,000	25,000	March 2013
Private equity investment
Equity investment in Nam Long Investment Corporation, an established developer in Ho Chi Minh City, Vietnam	Listed equity investment	16.3%	n/a	n/a	n/a
Pipeline projects
The RuMa Hotel and Residences Kuala Lumpur, Malaysia	Luxury residential tower and boutique hotel	70%	40,000	4,000	Fourth quarter of 2016
Kota Kinabalu seafront resort & residences Kota Kinabalu, Sabah, Malaysia	(i) Boutique resort hotel resort villas (ii) Resort homes	100% 80%	n/a	327,000	The project has not commenced
Waterside Estates, Ho Chi Minh City, Vietnam	Villas and high-rise apartments	55%	94,000	57,000	The project has not commenced
Other developments in International Hi-tech Healthcare Park, Ho Chi Minh City, Vietnam	Commercial and residential development with healthcare theme	66.8%	972,000	351,000	The project has not commenced

n/a: Not available / not applicable

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2013

	Notes	Unaudited	Unaudited	Audited
		As at 30 June	As at 30 June	As at 31 December
		2013	2012	2012
		US$'000	US$'000	US$'000
Non-current assets
Property, plant and equipment		1,126	4,613	1,113
Investment in an associate		-	-	-
Available-for-sale investments		16,932	22,052	12,571
Intangible assets		13,738	14,840	13,845
Deferred tax assets		-	689	-
Total non-current assets		31,796	42,194	27,529
Current assets
Inventories		426,284	303,792	350,822
Held-for-trading financial instrument		383	6,670	1,370
Trade and other receivables		10,747	56,706	12,725
Amount due from an associate		-	191	239
Current tax asset		251	194	237
Cash and cash equivalents		19,745	19,588	16,752
Total current assets		457,410	387,141	382,145
TOTAL ASSETS		489,206	429,335	409,674
Equity
Share capital		10,626	10,626	10,626
Share premium		218,926	218,925	218,926
Capital redemption reserve		1,874	1,874	1,874
Translation reserve		(260)	(569)	2,986
Fair value reserve		4,361	4,828	-
Accumulated losses		(64,604)	(36,587)	(50,828)
Shareholders' equity		170,923	199,097	183,584
Non-controlling interests		12,321	13,513	13,063
Total equity		183,244	212,610	196,647
Current liabilities
Trade and other payables		56,527	46,669	56,764
Amount due to an associate		557	-	-
Amount due to non-controlling interests		10,177	1,510	9,807
Deferred revenue		-	38,089	-
Loans and borrowings	9	26,677	20,898	20,687
Current tax liabilities		1,618	3,501	2,097
Total current liabilities		95,556	110,667	89,355
Non-current liabilities
Amount due to non-controlling interests		-	3,000	-
Loans and borrowings	9	51,094	26,896	40,497
Medium term notes	10	159,312	76,162	83,175
Total non-current liabilities		210,406	106,058	123,672
Total liabilities		305,962	216,725	213,027
TOTAL EQUITY AND LIABILITIES		489,206	429,335	409,674

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 30 JUNE 2013 - UNAUDITED

	Share Capital US$'000	Share Premium US$'000	Capital Redemption Reserve US$'000	Translation Reserve US$'000	Fair Value Reserve US$'000	Accumulated Losses  US$'000	Total Equity Attributable to Equity Holders of the Parent US$'000	Non- Controlling Interests US$'000	Total Equity US$'000
At 1 January 2013	10,626	218,926	1,874	2,986	-	(50,828)	183,584	13,063	196,647
Non-controlling interests contribution	-	-	-	-	-	-	-	170	170
Loss for the period	-	-	-	-	-	(13,776)	(13,776)	(660)	(14,436)
Total other comprehensive income	-	-	-	(3,246)	4,361	-	1,115	(252)	863
Total comprehensive expense	-	-	-	(3,246)	4,361	(13,776)	(12,661)	(912)	(13,573)
Shareholders' equity  at 30 June 2013	10,626	218,926	1,874	(260)	4,361	(64,604)	170,923	12,321	183,244

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 30 JUNE 2012 - UNAUDITED

	Share Capital US$'000	Share Premium US$'000	Capital Redemption Reserve US$'000	Translation Reserve US$'000	Fair Value Reserve US$'000	Accumulated Losses  US$'000	Total Equity Attributable to Equity Holders of the Parent US$'000	Non- Controlling Interests US$'000	Total Equity US$'000
At 1 January 2012	10,626	219,101	1,874	(262)	4,828	(32,797)	203,370	4,276	207,646
Purchase of own shares	-	(176)	-	-	-	-	(176)	-	(176)
Non-controlling interests contribution	-	-	-	-	-	-	-	8,431	8,431
Change in ownership interest in subsidiaries	-	-	-	-	-	(1,164)	(1,164)	1,164	-
Loss for the period	-	-	-	-	-	(2,626)	(2,626)	(488)	(3,114)
Total other comprehensive expense	-	-	-	(307)	-	-	(307)	130	(177)
Total comprehensive expense	-	-	-	(307)	-	(2,626)	(2,933)	(358)	(3,291)
Shareholders' equity  at 30 June 2012	10,626	218,925	1,874	(569)	4,828	(36,587)	199,097	13,513	212,610

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2012 - AUDITED

	Share Capital US$'000	Share Premium US$'000	Capital Redemption Reserve US$'000	Translation Reserve US$'000	Fair Value Reserve US$'000	Accumulated Losses US$'000	Total Equity Attributable to Equity Holders of the Parent US$'000	Non- Controlling Interests US$'000	Total Equity US$'000
1 January 2012	10,626	219,101	1,874	(262)	4,828	(32,797)	203,370	4,276	207,646
Changes in ownership interests in subsidiaries	-	-	-	-	-	(1,192)	(1,192)	1,192	-
Non-controlling interests contribution	-	-	-	-	-	-	-	9,026	9,026
Loss of the year	-	-	-	-	-	(16,839)	(16,839)	(1,590)	(18,429)
Total other comprehensive expense	-	-	-	3,248	(4,828)	-	(1,580)	159	(1,421)
Total comprehensive expense	-	-	-	3,248	(4,828)	(16,839)	(18,419)	(1,431)	(19,850)
Own shares acquired	-	(175)	-	-	-	-	(175)	-	(175)
Shareholders' equity at 31 December 2012	10,626	218,926	1,874	2,986	-	(50,828)	183,584	13,063	196,647

CONSOLIDATED STATEMENT OF CASH FLOWS
SIX MONTHS ENDED 30 JUNE 2013
	Unaudited	Unaudited	Audited
	Six months	Six months	Year
	ended 30 June	ended 30 June	ended 31 December
	2013	2012	2012
	US$'000	US$'000	US$'000
Cash Flows from Operating Activities
Net loss before taxation	(13,731)	(2,338)	(16,631)
Finance income	(208)	(178)	(407)
Finance costs	3,884	798	4,299
Share of losses of associates, net of tax	3,029	-	-
Unrealised foreign exchange loss	378	123	(642)
Reversal of impairment of trade receivables	-	(356)	(357)
Impairment of goodwill	107	163	1,158
Depreciation of property, plant and equipment	61	346	190
Loss on disposal of property, plant and equipment	-	-	1
Property, plant and equipment written off	-	-	31
Decline in fair value of available-for-sale
investments	-	-	4,653
Fair value loss on held-for-trading financial instrument	5	60	81
Operating loss before working capital changes	(6,475)	(1,382)	(7,624)
Changes in working capital:
Increase in inventories	(85,533)	(9,289)	(54,318)
Decrease/(increase) in receivables	1,978	(22,865)	21,117
Increase in deferred revenue	-	38,089	-
Increase/(decrease) in payables	2,498	(26,339)	(14,856)
Cash used in operations	(87,532)	(21,786)	(55,681)
Interest paid	(5,141)	(3,815)	(5,577)
Tax paid	(1,124)	(1,410)	(3,356)
Net cash used in operating activities	(93,797)	(27,011)	(64,614)
Cash Flows From Investing Activities
Advances from non-controlling interests	370	-	6,801
Issuance of ordinary shares of subsidiaries to non-     controlling interests	170	1,951	2,546
Repayment from/ (advances to) associate	239	(69)	(117)
Proceeds from disposal of property, plant and         Equipment	-	-	1
Disposal of held-for-trading financial instrument	982	14,654	19,933
Purchase of property, plant and equipment	(50)	(323)	(279)
Finance income received	208	178	407
Net cash from investing activities	1,919	16,391	29,292

Consolidated Statement of Cash Flows (CONT'D)
SIX MONTHS ENDED 30 JUNE 2013
		Unaudited Six months ended 30 June	Unaudited Six months ended 30 June	Audited Year ended 31 December
		2013	2012	2012
		US$'000	US$'000	US$'000
Cash Flows From Financing Activities
Repurchase of own shares		-	(176)	(175)
Repayment of loans and borrowings and medium term notes		(5,111)	(10,070)	(12,080)
Drawdown of loans and borrowings and medium term notes		101,243	8,010	30,390
Pledged deposits placed in licensed banks		-	-	(1,371)
Net cash from/(used in) financing activities		96,132	(2,236)	16,764
NET CHANGES IN CASH AND CASH EQUIVALENTS DURING THE PERIOD/YEAR	4,254		(12,856)	(18,558)
Effect of changes in exchange rates	(845)		(166)	1,329
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD/YEAR	5,582		32,610	22,811
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD/YEAR	8,991		19,588	5,582
Cash and Cash Equivalents Cash and cash equivalents included in the consolidated statement of cash flows comprise the following consolidated statement of financial position amounts:
Cash and bank balances	6,345		8,459	5,152
Short term bank deposits	13,400		11,129	11,600
Cash and cash equivalents	19,745		19,588	16,752
Less: Deposits pledged	(10,754)		-	(11,170)
	8,991		19,588	5,582

During the financial period, the Group acquired property, plant and equipment with an aggregate cost of US$91,000 (30 June 2012: US$323,000; 31 December 2012: US$311,833) of which US$41,005 (30 June 2012: US$Nil; 31 December 2012: US$32,700) was acquired by means of finance leases.

During the financial period, US$170,000 (30 June 2012: US$8,431,000; 31 December 2012: US$9,026,000) of ordinary shares of subsidiaries were issued to non-controlling shareholders, of which US$170,000 (30 June 2012: US$1,951,000; 31 December 2012: US$2,546,000) was satisfied via cash consideration. The remaining amount of US$Nil (30 June 2012: US$6,480,000; 31 December 2012: US$6,480,000) was satisfied via contribution of land held for property development by non-controlling interest. 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2013

1.   General Information

The principal activities of the Group are acquisition, development and redevelopment of upscale residential, commercial, hospitality and healthcare projects in the major cities of Malaysia and Vietnam.  The Group typically invests in development projects at the pre-construction stage and may also selectively invests in projects in construction and newly completed projects with potential capital appreciation.

2.   Summary of Significant Accounting Policies

2.1. Basis of Preparation

The interim condensed consolidated financial statements for the six months ended 30 June 2013 has been prepared in accordance with IAS 34, Interim Financial Reporting.

The interim condensed consolidated financial statements should be read in conjunction with the annual financial statements for the year ended 31 December 2012 which has been prepared in accordance with IFRS.

Taxes on income in the interim period are accrued using the tax rate that would be applicable to expected total annual earnings.

The interim results have not been audited nor reviewed and do not constitute statutory financial statements.

The preparation of financial statements in conformity with IFRS requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Although these estimates are based on management's best knowledge of the amount, event or actions, actual results ultimately may differ from those estimates. 

The accounting policies applied are consistent with those of the annual financial statements for the year ended 31 December 2012 as described in those annual financial statements.

The interim report and financial statements were approved by the Board of Directors on 28 August 2013.

3.   SegmentAL Information

The Group's assets and business activities are managed by Ireka Development Management Sdn. Bhd. ("IDM") as the Development Manager under a management agreement dated 27 March 2007.

Segmental information represents the level at which financial information is reported to the Executive Management of IDM, being the chief operating decision maker as defined in IFRS 8.  The Executive Management consists of the Chief Executive Officer, the Chief Financial Officer and the Chief Operating Officer of IDM.  The management determines the operating segments based on reports reviewed and used by the Executive Management for strategic decision making and resource allocation.  For management purposes, the Group is organised into project units.

The Group's reportable operating segments are as follows:

(i)   Investment Holding Companies - investing activities;

(ii)  Ireka Land Sdn. Bhd. - develops Tiffani by i-ZEN and 1 Mont' Kiara by i-ZEN;

(iii) ICSD Ventures Sdn. Bhd. - develops Sandakan Harbour Square;

(iv) Amatir Resources Sdn. Bhd. - develops SENI Mont' Kiara; and

(v)  Hoa Lam-Shangri-La Healthcare Group - develops City International Hospital and Hi-Tech   

      Healthcare Park.

Other non-reportable segments comprise the Group's other new development projects. None of these segments meets any of the quantitative thresholds for determining reportable segments in 2013 and 2012.

Information regarding the operations of each reportable segment is included below. The Executive Management monitors the operating results of each segment for the purpose of performance assessments and making decisions on resource allocation.  Performance is based on segment gross profit and profit before taxation, which the Executive Management believes are the most relevant in evaluating the results relative to other entities in the industry. Segment assets and liabilities are presented inclusive of inter-segment balances and inter-segment pricing is determined on an arm's length basis. 

The Group's revenue generating development projects are currently only in Malaysia since development activities in Vietnam are still at approved and construction stages.

Operating Segments - ended 30 June 2013
	Investment Holding Companies	Ireka Land Sdn. Bhd.	ICSD Ventures  Sdn. Bhd.	Amatir Resources Sdn. Bhd.	Hoa Lam-Shangri-La Healthcare Group	Total
	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000
Segment profit/(loss) before taxation	(4,731)	(121)	(2,954)	93	(1,569)	(9,282)
Included in the measure of segment profit/(loss) are:
Revenue	-	436	401	9,385	-	10,222
Cost of acquisition written down	-	(8)	(68)	(1,976)	-	(2,052)
Goodwill impairment	-	-	-	(107)	-	(107)
Marketing expenses	-	-	-	(437)	-	(437)
Depreciation of     property, plant     and equipment	-	(2)	(5)	(1)	(49)	(57)
Finance costs	-	-	(2,240)	(201)	(133)	(2,574)
Finance income	2	2	150	11	14	179
Segment assets	17,254	10,364	109,177	92,062	94,167	323,024
Included in the measure of segment assets are:
Addition to non-current assets other than financial instruments and deferred tax assets	-	-	6	-	23	29

Reconciliation of reportable segment revenues, profit or loss, assets and liabilities and other material items.
Profit or loss	US$'000
Total profit or loss for reportable segments	(9,282)
Other non-reportable segments	(3,164)
Depreciation	(4)
Finance cost	(1,310)
Finance income	29
Consolidated loss before taxation	(13,731)

Operating Segments - ended 30 June 2012
	Investment Holding Companies	Ireka Land Sdn. Bhd.	ICSD Ventures  Sdn. Bhd.	Amatir Resources Sdn. Bhd.	Hoa Lam-Shangri-La Healthcare Group	Total
	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000
Segment profit/(loss) before taxation	(1,888)	1,229	(1,606)	591	(697)	(2,371)
Included in the measure of segment profit/(loss) are:
Revenue	-	-	612	17,764	-	18,376
Cost of acquisition written down	-	-	(36)	(3,003)	-	(3,039)
Goodwill impairment	-	-	-	(163)	-	(163)
Marketing expenses	-	-	(2)	(1,386)	-	(1,388)
Depreciation of     property, plant     and equipment	-	(3)	(294)	(1)	(46)	(344)
Finance costs	(5)	-	(195)	(447)	(147)	(794)
Finance income	60	15	4	31	3	113
Segment assets	25,323	14,153	106,347	149,139	46,601	341,563
Included in the measure of segment assets are:
Addition to non-current assets other than financial instruments and deferred tax assets	-	-	225	-	5	230

Reconciliation of reportable segment revenues, profit or loss, assets and liabilities and other material items.
Profit or loss	US$'000
Total profit or loss for reportable segments	(2,371)
Other non-reportable segments	(26)
Depreciation	(2)
Finance cost	(4)
Finance income	65
Consolidated loss before taxation	(2,338)

Operating Segments - ended 31 December 2012

	Investment Holding Companies	Ireka Land Sdn. Bhd.	ICSD Ventures Sdn. Bhd.	Amatir Resources Sdn. Bhd.	Hoa Lam-Shangri-La Healthcare Group	Total
	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000
Segment profit/     (loss) before     taxation	(7,904)	2,199	(8,153)	1,096	(1,950)	(14,712)
Included in the measure of segment profit/(loss) are:
Revenue	-	-	852	22,511	-	23,363
Cost of acquisition     written down	-	(392)	(69)	(3,912)	-	(4,373)
Goodwill     impairment	-	-	(946)	(212)	-	(1,158)
Marketing expenses	-	(54)	(2)	(1,898)	-	(1,954)
Depreciation of property, plant and equipment	-	(8)	(86)	(1)	(92)	(187)
Finance costs	(31)	-	(3,071)	(731)	(434)	(4,267)
Finance income	76	18	217	63	7	381
Segment assets	13,205	11,164	112,363	102,178	77,962	316,872
Included in the      measure of     segment assets     are:
Addition to non-     current assets     other than     financial     instruments and     deferred tax      assets	-	-	273	-	27	300

Reconciliation of reportable segment revenues, profit or loss, assets and liabilities and other material items
Profit or loss	US$'000
Total profit or loss for reportable segments	(14,712)
Other non-reportable segments	(1,910)
Depreciation	(3)
Finance cost	(32)
Finance income	26
Consolidated loss before taxation	(16,631)

30 June 2013 US$'000	Revenue		Depreciation		Finance costs		Finance income			Segment assets		Addition to non-current assets
Total reportable segment	10,222		(57)		(2,574)		179			323,024		29
Other non-reportable segments	-		(4)		(1,310)		29			166,182		62
Consolidated total	10,222		(61)		(3,884)		208			489,206		91
30 June 2012 US$'000		Revenue		Depreciation		Finance costs		Finance income	Segment assets		Addition to non-current assets
Total reportable segment		18,376		(344)		(794)		113	341,563		230
Other non-reportable segments		145		(2)		(4)		65	87,772		93
Consolidated total		18,521		(346)		(798)		178	429,335		323

31 December 2012 US$'000	Revenue	Depreciation	Finance costs	Finance income	Segment assets	Addition to non-current assets
Total reportable segment	23,363	(187)	(4,267)	381	316,872	300
Other non-reportable segments	369	(3)	(32)	26	92,802	12
Consolidated total	23,732	(190)	(4,299)	407	409,674	312

Geographical Information - ended 30 June 2013

	Malaysia	Vietnam	Consolidated
	US$'000	US$'000	US$'000
Revenue	10,222	-	10,222
Non-current assets	3,138	28,658	31,796

For the financial period ended 30 June 2013, no single customer exceeded 10% of the Group's total revenue.

Geographical Information - ended 30 June 2012

	Malaysia	Vietnam	Consolidated
	US$'000	US$'000	US$'000
Revenue	18,521	-	18,521
Non-current assets	8,347	33,847	42,194

For the financial period ended 30 June 2012, no single customer exceeded 10% of the Group's total revenue.

Geographical Information - ended 31 December 2012

	Malaysia	Vietnam	Consolidated
	US$'000	US$'000	US$'000
Revenue	23,732	-	23,732
Non-current assets	3,188	24,341	27,529

For the financial year ended 31 December 2012, no single customer exceeded 10% of the Group's total revenue.

4.   Seasonality

The Group's business operations are not materially affected by seasonal factors for the period under review.

5.   Cost of Sales

	Unaudited	Unaudited	Audited
	Six months	Six months	Year
	ended 30 June	ended 30 June	ended 31 December
	2013	2012	2012
	US$'000	US$'000	US$'000
Direct costs attributable to property development	8,379	16,419	21,459
Hotel operations	-	324	-
	8,379	16,743	21,459

6.   Foreign exchange (loss)/GAIN

	Unaudited	Unaudited	Audited
	Six months	Six months	Year
	ended 30 June	ended 30 June	ended 31 December
	2013	2012	2012
	US$'000	US$'000	US$'000
Foreign exchange (loss)/gain comprises:
Unrealised foreign exchange (loss)/gain	(378)	(123)	642
Realised foreign exchange (loss)/gain	(65)	99	(118)
	(443)	(24)	524

7.   Taxation

	Unaudited	Unaudited	Audited
	Six months	Six months	Year
	ended 30 June	ended  30 June	ended  31 December
	2013	2012	2012
	US$'000	US$'000	US$'000
Current tax expense	705	776	1,087
Deferred tax expense	-	-	711
Total tax expense for the period/year	705	776	1,798

The numerical reconciliation between the income tax expenses and the product of accounting results multiplied by the applicable tax rate is computed as follows:

	Unaudited	Unaudited	Audited
	Six months	Six months	Year
	ended 30 June	ended 30 June	Ended 31 December
	2013	2012	2012
	US$'000	US$'000	US$'000
Accounting loss	(13,731)	(2,338)	(16,631)
Income tax at a rate of 25%*	(3,433)	(585)	(4,158)
Add :
Tax effect of expenses not deductible in determining taxable profit	2,437	2,277	4,329
Movement of unrecognised deferred tax benefits	1,773	7	1,663
Tax effect of different tax rates in subsidiaries**	108	139	362
Less :
Tax effect of income not taxable in determining taxable profit	(183)	(1,062)	(244)
Under/(over) provision	3	-	(154)
Total tax expense for the period/year	705	776	1,798

*      The applicable corporate tax rate in Malaysia and Vietnam is 25%.

**     The applicable corporate tax rate in Singapore is 17%. A subsidiary of the Group, Hoa Lam-Shangri-La Healthcare Ltd Liability Co is granted preferential corporate tax rate of 10% for its profit arising from hospital income. The preferential income tax is given by the government of Vietnam due to the subsidiary's involvement in the healthcare and education industries.

The Company is treated as a tax resident of Jersey for the purpose of tax laws and is subject to a tax rate of 0%.

A Goods and Services Tax was introduced in Jersey in May 2008. The Company has been registered as an International Services Entity so that it does not have to charge or pay local GST. The cost for this registration is £200 per annum.

The Directors intend to conduct the Group's affairs such that the central management and control is not exercised in the United Kingdom and so that neither the Company nor any of its subsidiaries carries on any trade in the United Kingdom. The Company and its subsidiaries will thus not be residents in the United Kingdom for taxation purposes. On this basis, they will not be liable for United Kingdom taxation on their income and gains other than income derived from a United Kingdom source.

8.   LOSS Per Share

Basic and diluted loss per ordinary share

The calculation of basic and diluted loss per ordinary share for the period/year ended was based on the loss attributable to equity holders of the parent and a weighted average number of ordinary shares outstanding, calculated as below:

	Unaudited	Unaudited	Audited
	Six months	Six months	Year
	ended 30 June	ended 30 June	ended  31 December
	2013	2012	2012
	US$'000	US$'000	US$'000
Loss attributable to equity holders of the parent	(13,776)	(2,626)	(16,839)
Weighted average number of shares	212,025	212,025	212,047
Loss per share (US cents):
Basic and diluted	(6.50)	(1.24)	(7.94)

9.   Loans and Borrowings

		Unaudited	Unaudited	Audited
		Six months	Six months	Year
		ended 30 June	ended 30 June	ended  31 December
		2013	2012	2012
Group		US$'000	US$'000	US$'000
Non-current
Bank loans		51,040	26,896	40,473
Finance lease liabilities		54	-	24
		51,094	26,896	40,497
Current
Bank loans		26,666	20,898	20,681
Finance lease liabilities		11	-	6
		26,677	20,898	20,687
		77,771	47,794	61,184

The effective interest rates of the bank loans and hire purchase arrangement for the period ranged from 5.20% to 23% (30 June 2012: 5.80% to 23%; 31 December 2012: 5.20% to 23%) per annum and is 2.50% (30 June 2012: n/a; 31 December 2012: 2.50%) per annum respectively.  

Borrowings are denominated in Malaysian Ringgit, United States Dollars and Vietnam Dong.  

Bank loans are repayable by monthly or quarterly instalments.

Bank loans are secured by land held for property development and work-in-progress and some by the corporate guarantee of the Company.

The carrying amount of borrowings approximates its fair value at statement of financial position date and non-current bank loans earn interest at floating rates.

Finance lease liabilities are payable as follows:

Group	Future minimum lease payment 30 June 2013 US$'000	Interest 30 June 2013 US$'000	Present value of minimum lease payment 30 June  2013 US$'000
Within one  year	13	2	11
Between one and five years	62	8	54
	75	10	65

Group	Future minimum lease payment 30 June 2012 US$'000	Interest 30 June 2012 US$'000	Present value of minimum lease payment 30 June  2012 US$'000
Within one  year	-	-	-
Between one and five years	-	-	-
	-	-	-

Group	Future minimum lease payment 31 December 2012 US$'000	Interest 31 December 2012 US$'000	Present value of minimum lease payment 31 December  2012 US$'000
Within one  year	7	1	6
Between one and five years	27	3	24
	34	4	30

10. Medium Term Notes

	Unaudited	Unaudited	Audited
	As at	As at	As at
	30 June	30 June	31 December
	2013	2012	2012
	US$'000	US$'000	US$'000
Outstanding medium term notes	162,630	77,102	85,020
Net transaction costs	(3,318)	(940)	(1,845)
Less:
Repayment due within twelve months	-	-	-
Repayment due after twelve months	159,312	76,162	83,175

The medium term notes were issued by a subsidiary, incorporated on 5 May 2011, to fund two development projects known as Sandakan Harbour Square and Aloft Kuala Lumpur Sentral hotel in Malaysia. US$77.3 million had been drawn down in 2011 for Sandakan Harbour Square. US$4.9 million had been drawn down in 2012 for Aloft Kuala Lumpur Sentral hotel and the remaining US$80.4 million has been fully drawn down in 2013. The weighted average interest rate of the loan was 5.51% per annum at the statement of the financial position date. The effective interest rates of the medium term notes and their outstanding amounts are as follows:

	Maturity Dates	Interest rate % per annum	US$'000
Series 1 Tranche FG 001	8 December 2014	5.38	7,910
Series 1 Tranche BG 001	8 December 2014	5.33	6,328
Series 1 Tranche FG 002	8 December 2015	5.46	14,238
Series 1 Tranche BG 002	8 December 2015	5.41	9,492
Series 2 Tranche FG 001	8 December 2015	5.46	22,148
Series 2 Tranche BG 001	8 December 2015	5.41	17,402
Series 3 Tranche FG001	1 October 2015	5.40	3,164
Series 3 Tranche BG001	1 October 2015	5.35	1,582
Series 3 Tranche FG002	29 January 2016	5.50	4,746
Series 3 Tranche BG002	29 January 2016	5.45	3,164
Series 3 Tranche FG003	8 April 2016	5.65	40,816
Series 3 Tranche BG003	8 April 2016	5.58	31,640
			162,630

             The medium term notes are secured by way of:

(i)         bank guarantee from two financial institutions in respect of  the BG Tranches;

(ii)        financial guarantee insurance policy from Danajamin Nasional Berhad in respect to the FG Tranches;

(iii)       a first fixed and floating charge over the present and future assets and properties of Silver Sparrow Berhad, ICSD Ventures Sdn. Bhd. and Iringan Flora Sdn. Bhd. by way of a debenture;

(iv)       a third party first legal fixed charge over ICSD Ventures Sdn. Bhd.'s  assets and land;

(v)        assignment of all Iringan Flora Sdn. Bhd.'s present and future rights, title, interest and benefits in and under the Sales and Purchase Agreement to purchase the Aloft Kuala Lumpur Sentral hotel from Excellent Bonanza Sdn. Bhd.;

(vi)       first fixed land charge over the Aloft Kuala Lumpur Sentral hotel and the Aloft Kuala Lumpur Sentral hotel's land (to be executed upon construction completion);

(vii)      a corporate guarantee by Aseana Properties Limited;

(viii)      letter of undertaking from Aseana Properties Limited to provide financial and other forms of support to ICSD Ventures Sdn. Bhd. to finance any cost overruns associated with the development of the Sandakan Harbour Square;

(ix)       assignment of all its present and future rights, interest and benefits under the ICSD Ventures Sdn. Bhd.'s and Iringan Flora Sdn. Bhd.'s Put Option Agreements and the proceeds from the Harbour Mall Sandakan, Four Points by Sheraton Sandakan hotel and Aloft Kuala Lumpur Sentral hotel;

(x)        assignment over the disbursement account, revenue account, Harbour Mall Sandakan operating account, sales proceed account, debt service reserve account and sinking fund account;

(xi)       assignment of all ICSD Ventures Sdn. Bhd.'s and Iringan Flora Sdn. Bhd.'s present and future rights, title, interest and benefits in and under the insurance policies; and

(xii)      a first legal charge over all the shares of the Silver Sparrow Berhad, ICSD Ventures Sdn. Bhd. and Iringan Flora Sdn. Bhd. and any dividends, distributions and entitlements.

11. Related Party Transactions

Transactions between the Group and the Company with Ireka Corporation Berhad ("ICB") and its group of companies are classified as related party transactions based on ICB's 23.07% shareholding in the Company.

	Unaudited	Unaudited	Audited
	Six months	Six months	Year
	ended  30 June	ended  30 June	ended  31 December
	2013	2012	2012
	US$'000	US$'000	US$'000
Project management fee charged to an associate	-	145	369
Accounting and financial reporting services fee charged by an ICB subsidiary	27	27	53
Construction progress claims charged by an ICB subsidiary	9,341	19,868	31,048
Management fees charged by an ICB subsidiary	1,821	2,156	4,231
Office rental and deposit charged by ICB	-	5	11
Project management fee for interior fit out works charged by an ICB subsidiary	62	62	124
Sales and administration fee and marketing commissions charged by an ICB subsidiary	172	310	557
Secretarial and administrative services fee charged by an ICB subsidiary	27	27	53
Project staff costs reimbursed to an ICB subsidiary	309	362	776
Remuneration of key management personnel - Salaries	20	19	39

	Unaudited As at 30 June 2013 US$'000	Unaudited As at 30 June 2012 US$'000	Audited As at 31 December 2012 US$'000
Amount due by an associate for project management fee	-	191	239
Amount due to an ICB subsidiary for accounting and financial reporting services fee	27	27	26
Amount due to an ICB subsidiary for contract works performed net of liquidated ascertained damages' recoverable of US$4,429,600 (30 June 2012:US$NIL; 31 December 2012: US$6,046,394)	3,701	10,529	6,043
Amount due to an ICB subsidiary for management fees	3,097	1,379	3,345
Amount due to ICB for office rental	-	3	-
Amount due to an ICB subsidiary for project management fee for interior fit out works	10	30	-
Amount due to an ICB subsidiary for sales and administration fee and marketing commissions	104	71	153
Amount due to an ICB subsidiary for secretarial and administrative services fee	53	27	26
Amount due to an ICB subsidiary for project staff costs	496	270	420

12. Dividends

The Company has not paid or declared any dividends during the financial period ended 30 June 2013.

13. Events after the Statement of Financial Position Date

There were no material adjusting events after the statement of financial position date ended 30 June 2013 that have not been reflected in the interim consolidated financial statements.

14. Interim Statement

Copies of this interim statement are available on the Company's website www.aseanaproperties.com or from the Company's registered office at 12 Castle Street, St. Helier, Jersey, JE2 3RT, Channel Islands.

Principal Risks and Uncertainties

The Board has overall responsibility for risk management and internal control. The following have been identified previously as the areas of principal risk and uncertainty facing the Company, and they remain relevant in the second half of the year.

·     Economic

·     Strategic

·     Regulatory

·     Law and regulations

·     Tax regimes

·     Management and control

·     Operational

·     Financial

·     Going concern

For greater detail, please refer to page 18 of the Company's Annual Report for 2012, a copy of which is available on the Company's website www.aseanaproperties.com.

RESPONSIBILITY STATEMENT

The Directors of the Company confirm that to the best of their knowledge that:

a)   The condensed consolidated financial statements have been prepared in accordance with IAS 34 (Interim Financial Reporting);

b)   The interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and

c)   The interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related party transactions and changes therein).

On behalf of the Board                       

Mohammed Azlan Hashim     Director 28 August 2013

Christopher Henry Lovell Director

 

END

 

 

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