Wing Tai Holdings Limited
Annual Report 2013
Celebrating
Wing Tai
OUR Winning PartnersHIPS
50 tH Anniversary
ANNUAL REPORT 2013
Today, Wing Tai has a
balanced and diversiﬁed
portfolio of residential,
commercial and hospitality
properties in Singapore,
Malaysia, Hong Kong
and China. Its other core
business is in fashion and
lifestyle retail, in which it
manages over 240 stores
in Singapore and Malaysia.
Contents
The pioneering
founders and their
supportive families.
01
CHAIRMAN’S MESSAGE
03
PROPERTY
06
HOSPITALITY
07
RETAIL
08
CORPORATE DATA
09
BOARD OF DIRECTORS
12
KEY MANAGEMENT
13
CORPORATE GOVERNANCE
20
CALENDAR OF EVENTS
21
FINANCIAL REPORTS
Singapore’s first
Finance Minister the
late Dr Goh Keng Swee
officiated the opening
of Wing Tai’s first
factory in Singapore
on 18 September
1963. Wing Tai was
granted pioneer
status and by 1989,
it had 20 factories in
Singapore, Malaysia,
Hong Kong, Tunisia,
China, Myanmar and
Sri Lanka.
The Giverny, Hong Kong
The front cover shows the Tembusu, a handsome
and distinctive native tree, noted for its deep roots
and extensive branch system. Its deep-grained bark
conveys character and tenacity, while its fragrant
ﬂowers offer inﬁnite delight. The Tembusu is an
inspiration which guides Wing Tai’s vision and
values; it stands as an enduring symbol of integrity
and resilience — a ﬁtting corporate logo for Wing
Tai as it sets sights on steady and conﬁdent growth.
Lanson Place Hotel, Hong Kong
Wing Tai believes in giving back
and caring for the society. It is also
committed to building trust and
long-term relationships with its
partners and staff.
Helios Residences, Singapore
Belle Vue Residences, Singapore
Early senior staff posing for a
photograph at the gate of the ﬁrst factory
at Little Road on its Opening Day in 1963.
The Meritz, Malaysia
Moving in tandem with the
transformation growth of the
Singapore economy, the company
ceased operations in garment
manufacturing in 1996 and
expanded its business in property
in 1978 and fashion retail in 1984.
With its exciting portfolio of retail brands,
Wing Tai holds itself to a high standard in
customer centricity to achieve service excellence.
The 10-storey building at 107 Tampines
Road was the tallest building in the
neighbourhood. The adjacent factory at
No. 105 was subsequently rebuilt as a ninestorey facility.
Adolfo Dominguez, Singapore
The Lakeside, China
1
Chairman’s
Message
OVERVIEW
The past year was characterised by uncertainty and volatility
in the global market, and macroeconomic concerns dominated
market sentiments. With the turn of the year, the market seems
to have stabilised with the traction that is gained from the
liquidity provided by both the European and United States’
central governments.
Despite the global ﬁnancial crisis, Asia is still the most probable
of emergent markets to see positive growth, compared with
Africa and Latin America. This is primarily because of China
which will continue to drive Asia’s future economic growth
because of urbanisation and the rise of a large middle class
population, rebalancing economic growth to focus more
on consumption.
The Singapore economy grew by 1.3% in 2012. Despite the
uncertainties in the global economic outlook, the Ministry of
Trade and Industry upgraded its economic growth forecast for
2013 from 1.0% - 3.0% to 2.5% - 3.5%.
In 2012, private residential sales volume hit a record high —
22,197 new residential units were sold in Singapore. Following
a series of cooling measures introduced by the Government,
in June 2013 the Monetary Authority of Singapore introduced
the new Total Debt Servicing Ratio (TDSR) framework for
property loans. The total number of new residential units sold
in Singapore decreased to 9,950 units in the ﬁrst half of 2013,
compared to 11,928 new units sold in the ﬁrst half of 2012.
GROUP PERFORMANCE
For the ﬁnancial year ended 30 June 2013, the Group recorded
a total revenue of S$1,332.5 million. This was 113% higher than
the S$624.9 million revenue recorded in the previous year. The
progressive sales recognised from Foresque Residences and
L’Viv, the additional units sold in Helios Residences and Belle
Vue Residences in Singapore contributed to this increase, as
well as the contribution from Verticas Residences in Malaysia.
Verticas Residences obtained its Temporary Occupation
Permit (TOP) in the current year and the revenue for all the
units sold as at the end of the current year was fully recognised.
The Group’s operating proﬁt rose from S$165.5 million to
S$435.4 million, a 163% increase over the previous year. In
the current year, the Group’s operating proﬁt includes fair
value gains on investment properties. It was S$52.1 million, as
compared to S$15.7 million gains in the previous year.
WING TAI ANNUAL REPORT 2013
2
The Group’s share of proﬁts of associated and joint
venture companies increased by 56% to S$294.8 million
in the current year. This increase is due to the higher share
of proﬁt from Wing Tai Properties Limited in Hong Kong.
The Group’s net proﬁt attributable to shareholders for
the current year is S$531.1 million, an increase of 102%. It
rose from S$262.4 million recorded in the previous year to
S$531.1 million for the current year.
The Group’s net asset value per share as at 30 June 2013
was S$3.62 as compared to S$2.85 as at 30 June 2012.
The Group’s net gearing ratio has been reduced from 0.17
times as at 30 June 2012 to 0.15 times as at 30 June 2013.
The Board of Directors recommended a ﬁrst and ﬁnal
dividend of 3 cents per share and a special dividend of 9
cents per share for the current year.
The Group sold a total of 538 residential units, with a
total sales value of S$885 million. In Singapore, the Group
launched the second phase of Foresque Residences,
a 496-unit development in the Upper Bukit Timah
precinct. To date, about 95% (469 units) has been sold.
The Tembusu, a 337-unit freehold development received
positive response when previewed in August 2013, with
approximately 65% (220 units) booked.
In September 2012, the Group together with Metro
Australia Holdings Pte Ltd and Maxdin Pte Ltd, jointly
acquired a 99-year leasehold site located at Prince Charles
Crescent in Singapore for the development of The Crest,
a premier 469-unit residential development to be released
in the last quarter of 2013. In China, the Group acquired
a 53,837.9 square meters land in Shanghai’s Baoshan
District in November 2012, which is being developed for
residential use.
The Group’s investment properties comprising commercial
developments and serviced apartments continued to do
well, with a revenue of S$37.5 million. Lanson Place’s latest
addition — Lanson Place Bukit Ceylon Serviced Residences
debut in August 2013.
The Group’s retail division continued to perform well,
achieving S$210 million in revenue for all brands under
the Group management. As at 30 June 2013, the Group’s
retail square footage has exceeded 670,000 square feet,
with over 240 stores in Singapore and Malaysia.
PROSPECTS
In view of the current market trends, the Group will adopt
an opportunistic approach towards land requisition in
Singapore. It will also continue to strengthen its position
and explore investment opportunities in Malaysia, China
and Hong Kong.
WING TAI ANNUAL REPORT 2013
APPRECIATION
We would not have succeeded without the support of our
many partners.
We thank our shareholders, who have given us their
vote of conﬁdence and supported us in growing our
business; our customers, for their patronage and for
taking delight in our products and services; our bankers
and business partners, who have stood by us and
shared their expertise and experience with us, to help
us grow.
On this milestone anniversary, I would like to express
my appreciation also to our Board of Directors for their
counsel and guidance. Two of our directors, Mr Lee Han
Yang and Mr Phua Bah Lee, have expressed their desire
to step down at the AGM in October 2013. On behalf of
the Board, I thank them most sincerely for the time and
the tireless efforts they have given the Company and
I am personally grateful to them for their constant advice
and support.
I am pleased to inform you that both Mr Lee and Mr Phua
have, at the Company’s request, very kindly agreed to
remain with us as Senior Advisors to the Company. I am
glad that we can continue to beneﬁt from their invaluable
experience and wisdom as we move forward to meet the
growing demands of our business.
To the management and staff of the company, I thank
them for their commitment and hard work. Last but not
least, to the Government and union leaders who have
supported us, we are thankful to have beneﬁtted from a
positive partnership with them through all these years.
WING TAI FOUNDATION
To commemorate the 50th anniversary of our founding
in Singapore, the Group has established the Wing Tai
Foundation to offer ﬁnancial aid to the needy elderly and
needy young. We have formalised our CSR commitment
to contribute a percentage of our annual net proﬁt
towards an endowment fund in the Foundation. An initial
S$10 million has been committed to the fund, which will
be built up to S$20 million. This enables us to recognise
the contribution the elderly have made to Singapore’s
progress and nation-building, and to nurture the younger
generation, to enrich lives. By giving back, the Group
continues to fulﬁll its corporate citizenry role in nationbuilding and in caring for the society. This, we believe, is
aligned to our vision and values, and holds true to our
business philosophy of achieving winning partnerships.
CHENG WAI KEUNG
Chairman
12 September 2013
3
Property
SINGAPORE
As of 30 June 2013, Foresque Residences, a 496-unit
leasehold development at Petir Road was 95% sold
(469 units), following a successful launch of the ﬁnal
block in September 2012. Topping out of the development
was held in March 2013 and Temporary Occupation Permit
is expected to be obtained in the ﬁrst quarter of 2014.
Ascentia Sky, a 373-unit leasehold development at
Alexandra View was fully sold and obtained its Temporary
Occupation Permit in January 2013. Units at the
development were handled over to homebuyers from
May 2013.
L’Viv, a 147-unit freehold development at Newton Road
was 98% sold (144 units). Topping out of the development
was held in December 2012 and Temporary Occupation
Permit is expected to be obtained in the third quarter of
2013. Floridian, a 336-unit freehold development at Bukit
Timah was fully sold since August 2012.
The Tembusu, situated at the site of
Wing Tai’s former headquarters, is an
anniversary development that bears the
hallmarks of a home of exceptional value.
WING TAI ANNUAL REPORT 2013
4
Belle Vue Residences, a 176-unit freehold development in
Oxley Rise designed by Pritzker Prize laureate Toyo Ito,
was 99% sold (175 units) while Helios Residences, a 140unit freehold development in Singapore’s prime Orchard/
Cairnhill area was 86% sold (120 units).
Topping out of Le Nouvel Ardmore at Ardmore Park,
designed by Pritzker Prize winner Jean Nouvel, was held in
March 2013. Exclusive private previews to VIP clients have
been ongoing. Construction of Nouvel 18 at Anderson
Road is taking shape and its Temporary Occupation
Permit is expected to be obtained in the fourth quarter
of 2014.
Preview of The Tembusu, a 337-unit freehold development
at Tampines Road was held in August 2013. Buyers’
response was encouraging, with 65% (220 units) of the
units booked. Groundbreaking of the site was held in
April 2013.
The Crest, located in the tranquil Jervois precinct,
fronting the good class bungalows of the Chatsworth
and Bishopsgate estates, was acquired in September
2012 and is expected to be released in the last
quarter of 2013. Groundbreaking of the site was held in
June 2013.
The Group’s investment properties fared well, with
Winsland House I and Winsland House II achieving
average occupancies of 98% and 95% respectively.
expected completion in September 2015 and sales
launch tentatively planned for middle of 2014.
The Bandar Sunway site, a 9.4-acre land planned for
76 units of 3-storey semi-detached houses, is awaiting
approval from Malaysian authorities, with sales launch
planned in August 2014. The Langgak Golf site, a 2.14-acre
land planned for 34 units of high-end condominium
and villa units, is also awaiting planning approval from
Malaysian authorities.
In Penang, Phase 2 of Taman BM Utama comprising
215 units of 2-storey terrace and semi-detached houses
was completed and 96% sold (207 units); 7 units of
2-storey commercial shops were completed and 71%
leased (5 units). Phase 3 comprising 141 units of 2-storey
and 3-storey terrace houses was completed and 91%
sold (129 units). Phase 4 comprising 98 units of 2-storey
terrace houses and 3-storey semi-detached houses was
21% completed.
Phase 1 of Jesselton Hills, which comprises 136 units
of 2-storey and 2½-storey semi-detached units, was
85% completed and 88% sold (119 units).
Impiana Boulevard and Impiana Avenue, which comprise
2-storey and 3-storey shop ofﬁces were completed and
68% sold (49 units) and 91% sold (31 units) respectively.
HONG KONG
MALAYSIA
The Group’s property business activities in Malaysia are
conducted through its subsidiary company, Wing Tai
Malaysia Berhad.
The Group’s property interests in Hong Kong are
represented by its investment in its associated company,
Wing Tai Properties Limited.
As of 30 June 2013, Verticas Residences, a 423-unit
freehold development at Bukit Ceylon in Kuala Lumpur
was 85% sold (361 units). The development was
completed in January 2013.
Providence Bay, Providence Peak and The Graces
located at Tai Po comprise an aggregate gross ﬂoor area
of approximately 2.1 million square feet. As of 30 June
2013, Providence Bay and Providence Peak were 60%
and 81% sold respectively; The Graces has not been
launched for sale.
Nobleton Crest, a 25-unit development located at Jalan
U-Thant is targeted to be completed in early 2014, with
sales launch tentatively planned in December 2013.
Le Nouvel KLCC, a 197-unit freehold development at
Jalan Ampang, is currently under construction, with
Seymour, a 82-unit high-end development at Seymour
Road, was 94% sold. The Warren and The Pierre were 71%
and 97% sold respectively. The residential development at
Ko Shan Road, Hung Hom, is currently under construction
and is scheduled for completion in 2015.
WING TAI ANNUAL REPORT 2013
5
Phase 2 of The Lakeside offers
quality residences by the
tranquil lake in Suzhou.
In August 2012 and January 2013, the Group through a
consortium acquired two premier residential development
sites at prestigious Kau To area in Shatin. With an
aggregate gross ﬂoor area of 460,000 square feet, the
sites are earmarked for low-density high-end apartments
and houses, scheduled for completion between 2016
and 2017.
The two investment properties viz. Landmark East in
Kowloon East and W Square in Wan Chai continued to do
well, achieving occupancy of 98% and 95% respectively.
CHINA
The Group’s property business activities in China are
conducted through its subsidiary companies, Jiaxin
(Suzhou) Property Development Co., Ltd and Wing Tai
(China) Investment Pte Ltd.
In Suzhou, Phase 3 of The Lakeview, which comprises 190
units in two residential towers was launched in October
2012 and was 27% sold (51 units). The development
received Certiﬁcate of Statutory Completion in May 2013.
Construction of Phase 2 of The Lakeside is slated to
commence in end 2013, with sales launch expected in the
last quarter of 2014. Designed by Thomas Heatherwick,
known for the British Pavilion at Shanghai Expo 2010, the
development has 60 apartment suites housed in three
iconic blocks, each with panoramic view of the Jinji Lake.
In Shanghai, the Group acquired a prime residential land
in Luodian New Town of Baoshan District in November
2012. Adjacent to the 36-hole PGA-standard Lake Malaren
Golf Course, the site will be developed into a low-density
mixed-landed residential estate, with approximately
235 units of landed homes and duplexes. Construction
is expected to commence in 2014 and sales launch is
planned for the last quarter of 2014.
In Guangzhou, Horizon Lakeview in the Sino-Singapore
Guangzhou Knowledge City will comprise 2,209
apartment and terraced units. Construction of the project
has commenced in March 2013, and sales launch is
expected in early 2014.
WING TAI ANNUAL REPORT 2013
6
Hospitality
Lanson Place Bukit Ceylon Serviced Residences features an elegant
interior with its own exclusive view of Kuala Lumpur, Malaysia.
The Group’s hospitality business under Lanson Place
management continues to record a steady growth in
average rental rate and occupancy.
In Singapore, Lanson Place Winsland Serviced Residences
achieved healthy occupancy of 87%. In Malaysia, Lanson
Place Bukit Ceylon Serviced Residences had its soft
opening in August 2013. Ambassador Row Serviced
Suites and Kondominium No. 8 did relatively well, with
occupancy of 92% and 63% respectively.
In Hong Kong, Lanson Place Hotel achieved healthy
occupancy amid its refurbishment in the ﬁrst half of 2013.
It was awarded the “Asia’s Leading Boutique Hotel” in
October 2012 at the World Travel Awards 2012 and the
"Certiﬁcate of Excellence" by TripAdvisor in May 2013.
WING TAI ANNUAL REPORT 2013
In China, Lanson Place Central Park Serviced Residences
in Beijing achieved high occupancy of over 95% and
Lanson Place Jinlin Tiandi Serviced Residences in
Shanghai maintained healthy occupancy during its
renovation period.
Lanson Place currently has a total of 9 management
contracts in Hong Kong, China and Southeast Asia. The
group will continue to focus and grow the Lanson Place
brand as a pan-Asian brand, and explore investment and
management opportunities in gateway cities in the Asia
Paciﬁc region.
7
Retail
The Group’s retail division performed well during the
ﬁnancial year, winning three prestigious awards viz.
Singapore Quality Award in Business Excellence 2012
and Organisation Commendation Award for Service
Leadership as well as the Pinnacle Individual Service
Professional Award at the Service Excellence Medallion
Award 2013.
These national recognitions reinforce Wing Tai’s edge
in customer service, and enable it to deal effectively
with competitions in a tight labour market and rising
operating costs.
Despite these challenges, the Group continued to expand
its presence in Singapore and Malaysia with plans to open
28 new stores and the addition of new brands. As of 30
June 2013, the Group’s retail division operates over 240
stores in these two countries with over 670,000 square
feet of retail space. Three new brands viz. Etam, a French
apparel brand; Adolfo Dominguez, a Spanish label; and
i.t, Hong Kong popular multi-labels were launched in
Singapore while Ben Sherman was introduced in Malaysia.
i.t opened its ﬁrst concept store at Wisma Atria,
carrying nine avant-garde street fashion brands, namely
izzue, b + a b, 5cm, tout à coup, ﬁngercroxx, Venilla
suite, as know as de base, mysty woman and Pageboy.
Ben Sherman reinvents premium customer shirting experience.
WING TAI ANNUAL REPORT 2013
8
Corporate
Data
BOARD OF DIRECTORS
NOMINATING COMMITTEE
AUDITORS
Executive
Lee Han Yang
Chairman
PricewaterhouseCoopers LLP
Public Accountants and
Certiﬁed Public Accountants
8 Cross Street
#17-00 PWC Building
Singapore 048424
Audit Partner: Choo Eng Beng
(Year of Appointment: 2011)
Cheng Wai Keung
Chairman/Managing Director
Edmund Cheng Wai Wing
Deputy Chairman/Deputy
Managing Director
Tan Hwee Bin
Executive Director
Non-Executive
Boey Tak Hap
Independent
Cheng Man Tak
Tan Sri Dato’ Mohamed
Noordin bin Hassan
Independent
Lee Han Yang
Independent
Cheng Wai Keung
Tan Sri Dato’ Mohamed
Noordin bin Hassan
Loh Soo Eng
REMUNERATION
COMMITTEE
Loh Soo Eng
Chairman
Boey Tak Hap
Tan Sri Dato’ Mohamed
Noordin bin Hassan
Phua Bah Lee
COMPANY SECRETARIES
Lee Kim Wah
Independent
Loh Soo Eng
Independent
Gabrielle Tan
Ooi Siew Poh
REGISTERED OFFICE
Phua Bah Lee
Independent
Paul Tong Hon To
Independent
AUDIT COMMITTEE
3 Killiney Road
#10-01 Winsland House I
Singapore 239519
Tel: 6280 9111
Fax: 6732 9956
www.wingtaiasia.com.sg
Paul Tong Hon To
Chairman
REGISTRAR &
TRANSFER OFFICE
Boey Tak Hap
Tricor Barbinder Share
Registration Services
(A division of Tricor
Singapore Pte. Ltd.)
80 Robinson Road #02-00
Singapore 068898
Lee Han Yang
Phua Bah Lee
WING TAI ANNUAL REPORT 2013
PRINCIPAL BANKERS
DBS Bank Limited
6 Shenton Way
DBS Building
Singapore 068809
The Hongkong and Shanghai
Banking Corporation Limited
21 Collyer Quay
HSBC Building
Singapore 049320
Malayan Banking Berhad
2 Battery Road
Maybank Tower
Singapore 049907
Overseas-Chinese Banking
Corporation Limited
65 Chulia Street
OCBC Centre
Singapore 049513
The Bank of TokyoMitsubishi UFJ, Ltd
9 Rafﬂes Place
#01-01 Republic Plaza
Singapore 048619
United Overseas Bank Limited
80 Rafﬂes Place
UOB Plaza
Singapore 048624
9
Board of
Directors
CHENG WAI KEUNG
BOEY TAK HAP
Cheng Wai Keung is Chairman of the Board of Wing Tai
Holdings Limited (the “Company”), appointed since 1994.
He is also Managing Director of the Company and a
member of the Nominating Committee. Mr Cheng is Vice
Chairman of Singapore-Suzhou Township Development
Pte Ltd and Managing Director of Wing Tai Malaysia Berhad,
a company listed on the Bursa Malaysia Securities Berhad.
He holds directorships in public and private companies,
including Temasek Holdings (Private) Limited, Singbridge
Holdings Pte Ltd, Singapore Health Services Pte Ltd,
and has served on the boards of several government
organisations. He was awarded the Distinguished Service
Order (DUBC) by the Singapore Government in August
2007, and received the Public Service Star (Bar) (BBMLintang) in 1997 and Public Service Star (BBM) in 1987.
He has been appointed Justice of The Peace by the
Singapore President since 2000. Mr Cheng graduated with
Masters of Business Administration from the University of
Chicago, after obtaining his Bachelor of Science degree
from Indiana University. Mr Cheng was re-elected director
on 30 October 2012.
Boey Tak Hap has served as a non-executive director since
2 May 1997. He is a member of both the Audit Committee
and Remuneration Committee. Mr Boey was formerly the
Chief of Army, Singapore Armed Forces and President
and CEO of Singapore Power Group. He was also
President and CEO of SMRT Corporation as well as Chief
Executive of the Public Utilities Board. Mr Boey graduated
from the University of Manchester Institute of Science
and Technology with a Bachelor of Science degree
in Automatic Control and System Engineering with
Management Sciences. In January 2002, he was conferred
Honorary Doctor of Engineering by his alma mater.
He also holds a Diploma in Business Administration from
the National University of Singapore and has attended
the Harvard Business School’s Advanced Management
Programme in Boston, USA. Mr Boey was re-elected
director on 27 October 2011.
EDMUND CHENG WAI WING
Edmund Cheng Wai Wing has served as Deputy Chairman
and Deputy Managing Director of the Company, and as
Executive Director of Wing Tai Malaysia Berhad since
1984. He is also Chairman of SATS Limited, a company
listed on the SGX-ST, and Mapletree Investments Pte Ltd.
He is a member of The Esplanade Co Ltd; and International
Council for Asia Society. He was President of REDAS
(Real Estate Developers’ Association of Singapore) and
now serves as a member on its Presidential Council. For
his contribution to public service, he was awarded the
Public Service Star Award (Bar) in 2010, Public Service
Star Award (BBM) in 1999 and Outstanding Contribution
to Tourism Award in 2002 by the Singapore Government.
Mr Cheng graduated from Northwestern University and
Carnegie Mellon University in USA, with a Bachelor’s
degree in Civil Engineering and Master’s in Architecture,
respectively. Mr Cheng was re-elected director on 27
October 2011.
CHENG MAN TAK
Cheng Man Tak has served as a non-executive director
since 11 May 1981. He is Vice-Chairman of Federation
of Hong Kong Industries – Group 24, director of the
Federation of Hong Kong Garment Manufacturers and a
member of the Occupational Safety and Health Council of
Hong Kong. He is also an authority member of Clothing
Industry Training Authority and a committee member
of Federation of Hong Kong Industries in Hong Kong.
Mr Cheng graduated from the University of Southern
California with a Bachelor of Science degree and holds
a Masters in Business Administration from Pepperdine
University, USA. Mr Cheng was re-elected director on
25 October 2010.
WING TAI ANNUAL REPORT 2013
10
TAN SRI DATO’ MOHAMED
NOORDIN BIN HASSAN
Tan Sri Dato’ Mohamed Noordin bin Hassan has served
as a non-executive director since 27 September 2002
and is a member of both the Nominating Committee
and Remuneration Committee. He has more than 40
years’ experience with the Malaysia Government, serving
at district, state and federal levels including as Deputy
Secretary General at the Ministry of Trade and Industry;
Secretary General at Ministry of Science, Technology and
Environment; and Secretary General at the Ministry of
Education. After retiring from the Malaysian civil service
in September 1994, he joined Petronas Berhad, as Vice
President of Group Human Resource and Vice President of
Education until 31 August 2000. He is currently Chairman
of Wing Tai Malaysia Berhad, a company listed on the Bursa
Malaysia Securities Berhad, and also sits on the Board of
several subsidiaries of Wing Tai Malaysia Berhad as well
as other companies in Malaysia. He graduated from the
University of Malaya with a Bachelor of Arts (Honours)
degree in Economics, and has a Master’s degree in Public
and International Affairs from the University of Pittsburgh,
USA. Tan Sri Dato’ Mohamed Noordin was re-elected
director on 30 October 2012.
LEE HAN YANG
Lee Han Yang has served as a non-executive director
since 3 January 1989. He is Chairman of the Nominating
Committee and a member of the Audit Committee. He is a
Barrister-at-Law of Lincoln’s Inn, London and an Advocate
and Solicitor of the Supreme Court of Singapore. Mr Lee
currently sits on the Board of Low Keng Huat (Singapore)
Ltd, a company listed on the SGX-ST. He is also a director
of Tan Chong International Ltd, a company listed on
the Stock Exchange of Hong Kong. Mr Lee is an active
member of the Law Society of Singapore and has served
on several committees of the Law Society. He also serves
on the Board of the Society for the Physically Disabled and
until recently he was on the board of the National Council
of Social Service. In August 2006, he was awarded the
Public Service Star (BBM) by the President of Singapore.
Mr Lee was re-elected director on 30 October 2012.
WING TAI ANNUAL REPORT 2013
LEE KIM WAH
Lee Kim Wah has been appointed Senior Advisor to
the Company since 5 December 2008 and remains
on the board as a non-executive director. He serves
as a treasurer of the Singapore National Employers’
Federation. Educated in Accountancy in Australia, Mr Lee
was a manager in a public accounting ﬁrm before joining
the Company, where he has served for over 40 years,
as Finance Director from May 1977 to December 2008.
Mr Lee was conferred the Public Service Medal (PBM)
by the Singapore Government in 2000. In 2009, he was
awarded the prestigious Medal of Commendation (Gold)
for his signiﬁcant contribution towards the Singapore
Labour Movement. Mr Lee was re-elected director on 30
October 2012.
LOH SOO ENG
Loh Soo Eng has served as a non-executive director since
1 June 2004, after retiring as Director-Property. He is
Chairman of the Remuneration Committee and a member
of the Nominating Committee. He has experience in
power, oil, shipbuilding and ship repair industries, as well
as in banking, where he had been for 17 years with the
DBS Group, as Executive Director of Rafﬂes City Pte Ltd
and General Manager of DBS Land. Mr Loh has served
on Government committees, including SAFTI Military
College and Temasek Polytechnic. He was Chairman of
SLF Properties Pte Ltd and SLF Management Services
Pte Ltd and was President of Real Estate Developers’
Association of Singapore (REDAS) from 2001 to 2003. He
graduated with a Bachelor of Engineering (Mechanical)
degree from the University of Adelaide, Australia. Mr Loh
was re-elected director on 30 October 2012.
11
PHUA BAH LEE
TAN HWEE BIN
Phua Bah Lee has served as a non-executive director
since 11 January 1989 and is a member of both the Audit
Committee and Remuneration Committee. Mr Phua is
currently a director of GP Industries Limited, Metro
Holdings Limited, Singapura Finance Limited and PanUnited Corporation Limited, all companies are listed on
the SGX-ST. He also holds directorships in a number of
private companies. He was the Singapore Parliamentary
Secretary of the Ministry of Communications from 1968
to 1971; Senior Parliamentary Secretary of the Ministry
of Defence from 1972 to 1988; and an elected Member
of Parliament for the Tampines Constituency from 1968
to 1988. He graduated from the Nanyang University in
Singapore with a Bachelor of Commerce degree. Mr Phua
was re-elected director on 30 October 2012.
Tan Hwee Bin has been appointed Executive Director
of the Company since 5 December 2008. Prior to her
appointment to the board, she was the Chief Operating
Ofﬁcer. Ms Tan is a Certiﬁed Public Accountant and
graduated with a Bachelor of Accountancy degree
from the National University of Singapore. In 2005,
she completed the Advanced Management Program at
Harvard Business School. Ms Tan is Chairman of NTUC
Unity Healthcare Co-operative Ltd and NTUC Eldercare
Co-operative Ltd. She is also director of Singapore
Labour Foundation, NTUC FairPrice Co-operative Ltd
and Agency for Integrated Care Pte Ltd. She is a member
of the Finance and Establishment Committee of Chinese
Development Assistance Council. She was awarded the
Public Service Medal (PBM) in 2011. Ms Tan was re-elected
director on 30 October 2012.
PAUL TONG HON TO
Paul Tong Hon To has served as a non-executive director
since 16 August 2007 and is Chairman of the Audit
Committee. He is currently a non-executive director of
Chinney Investments, Limited, publicly listed on the Stock
Exchange of Hong Kong. Mr Tong has many years of senior
management experience in manufacturing and trading
businesses with global operations. He was formerly
Executive Vice President and General Counsel of Johnson
Electric Holdings Limited. He also served as a member
on the Inland Revenue Board of Review in Hong Kong.
Mr Tong obtained his Bachelor of Science (Economics)
degree and postgraduate Certiﬁcate of Management
Studies from the University of London and the University
of Oxford in England, respectively. He was admitted as
Barrister of the Middle Temple in England, the Supreme
Court of Hong Kong, and the High Court of Australia. He is
also a CPA of The Hong Kong Institute of Certiﬁed Public
Accountants; and an Associate Member of The Institute
of Chartered Secretaries and Administrators. Mr Tong was
re-elected director on 25 October 2010.
WING TAI ANNUAL REPORT 2013
12
Key
Management
DATO’ ROGER CHAN WAN CHUNG
LEN SIEW LIAN
Dato’ Roger Chan Wan Chung joined Wing Tai Malaysia
Berhad (“WTMB”) as General Manager in June 1971
and he is one of the pioneer staff of WTMB. With
over 40 years of business experience in Malaysia,
he assists the Managing Director in overseeing the
day-to-day operation of the WTMB Group. He was
appointed to the WTMB Board on 18 August 1988
and currently sits on the Board of several subsidiaries
of WTMB Group and other private limited companies.
Len Siew Lian is General Manager (Property) of Wing Tai
Holdings Limited. She oversees residential marketing and
project launches of development properties for sale, and
asset management of commercial/investment properties.
She joined the Company in September 1989 where she
was involved in commercial leasing of both ofﬁce and
retail. Ms Len graduated with a Bachelor of Science
(Estate Management) degree from the National University
of Singapore and, in 2008, completed the Advanced
Management Program at Harvard Business School.
HELEN CHOW
Helen Chow is Director of Wing Tai Property Management
Pte Ltd appointed since November 1991, having held
various positions in the Company since 1975. She is
responsible for marketing and sales functions in the
property division. She develops and implements strategies
to achieve optimal marketing mix for property products,
as well as manages sales operations across geographies
to achieve revenue goals. She holds a Bachelor of Arts
degree from Mills College, Oakland, California, USA.
NG KIM HUAT
Ng Kim Huat is Chief Financial Ofﬁcer, Wing Tai Holdings
Limited. He has been with the Company since December
2003, having more than 10 years of auditing experience
with an international public accounting ﬁrm in Singapore
as a Certiﬁed Public Accountant. He graduated with a
Bachelor of Accountancy (Honours) degree from the
National University of Singapore.
KARINE LIM
HELEN KHOO
Helen Khoo is Executive Director of Wing Tai Retail
Pte Ltd and drives the growth and expansion of the
Company’s portfolio of retail brands. She was conferred
the Miﬂora M. Gatchalian Medal for Women Global
Quality Leadership Award 2013, Achievers & Leaders
Award (Business Leadership) 2012, WDA’s Singapore
Workforce Skills Qualiﬁcations Champion 2010, Retail
Leadership Award 2008 and International Management
Action Award (IMAA) 2007. She chairs WDA’s Retail
Industry Skills and Training Council and is a member of
ITE’s Business & Services Academic Advisory Committee
(BSAAC), as well as Honorary Secretary of both
Singapore Retailers Association and Orchard Road
Business Association. She graduated with a Bachelor of
Arts (Honours) degree from the University of Hong Kong.
WING TAI ANNUAL REPORT 2013
Karine Lim is General Manager, Group Human Resource
and has been with the Company since March 2004, having
more than 18 years of human resource management
experience in the retail, property and public transport
industries. She graduated with a Bachelor of Arts (Honours)
degree from the National University of Singapore and has
acquired a Diploma in Human Resource Management
from the Singapore Human Resource Institute.
13
Corporate
Governance
The Company remains ﬁrmly committed to ensuring a
high standard of corporate governance to protect and
enhance long term value and returns for its shareholders.
The principles, structures and processes of corporate
governance as adopted by the Company for the ﬁnancial
year ended 30 June 2013 are set out in this report which
are in line with the principles and guidelines of the Code
of Corporate Governance 2005.
Directors’ Attendance at Board and
Board Committee Meetings for FY2013
The revised Code of Corporate Governance 2012 (the
“2012 Code”) takes effect for ﬁnancial years commencing
from 1 November 2012. The Company will where necessary,
adopt the recommendations of the 2012 Code in respect
of the Company’s Annual Report for the next ﬁnancial year.
Cheng Wai Keung
Edmund Cheng
Wai Wing
Boey Tak Hap
Cheng Man Tak
Tan Sri Dato’ Mohamed
Noordin bin Hassan
Lee Han Yang
Lee Kim Wah
Loh Soo Eng
Phua Bah Lee
Paul Tong Hon To
Tan Hwee Bin
BOARD MATTERS
The Board’s Conduct of its Affairs
The Board is responsible for the overall management of
the Company, and the Directors objectively take decisions
in the interests of the Company. The Board continues
to set the Company’s values and standards to ensure
obligations to shareholders and other stakeholders are
properly understood and met. The principal functions
of the Board include approving strategic business plans
and major acquisitions or disposal of assets, reviewing
Management performance, reviewing the Group’s
corporate policies and ﬁnancial performance, approving
quarterly and annual ﬁnancial results of the Group,
and establishing a framework of prudent and effective
controls to assess and manage risk.
The Board conducts regular meetings on a quarterly basis
and as necessary when circumstances arise. A total of four
Board meetings were held in the current ﬁnancial year.
Details of attendance of the Directors at the Board and
Board Committee meetings for the year are as follows:
Name
Board
Audit
Committee
Remuneration Nominating
Committee Committee
Meetings
Held: 4
Meetings
Held: 4
Meetings
Held: 2
Meetings
Held: 1
Meetings
Attended
Meetings
Attended
Meetings
Attended
Meetings
Attended
4
4
4
4
4
4
4
4
4
4
4
1
4
2
2
1
1
4
2
1
1
1
4
4
Matters which require the Board’s approval include those
involving material acquisitions and disposal of assets,
dividends and other returns to shareholders, fund raising
exercises, corporate and ﬁnancial restructuring and
interested person transactions of a material nature.
A director’s contribution may extend beyond the conﬁnes
of formal Board meetings, through sharing of views,
advice, experience, and strategic networking relationships
which would further the interests of the Company.
The Board is responsible for the overall strategy and
direction of the Group and is regularly updated on changes
to regulations and accounting standards. Where regulatory
changes have an important bearing on the Company’s
or directors’ disclosure obligations, Directors are briefed
during Board meetings. Newly appointed directors are
given brieﬁngs by the Management on the Group’s
business, directions and policies and are encouraged to
attend courses organised by the Singapore Institute of
Directors as well as other relevant organisations.
WING TAI ANNUAL REPORT 2013
14
It is important that every director receives further relevant
training, particularly on relevant new laws, regulations
and changing commercial risks from time to time. The
Company Secretary keeps the Directors informed as and
whenever there are appropriate courses, conferences
and seminars such as those conducted by the Singapore
Institute of Directors. The Directors are encouraged to
attend such training at the Company’s expense. During
FY2013, the seminars/workshops that Directors attended
were “Enhanced Listing Rules and Revised Code of
Corporate Governance”, “All You Need To Know About
The Personal Data Protection Act” and “Nominating
Committee Essentials”.
does not consider it to be in the interests of the Company
or shareholders to require all Directors who have served
for nine years or longer to retire at the same time and
strongly favours ensuring continuity and stability through
orderly succession.
Given the present scope and nature of the Company’s
operations, the Board considers its current size and
members whose core competencies, qualiﬁcations,
skills and experience are extensive and complementary,
to be appropriate. The Board will examine its size and
composition whenever circumstances require it. No
individual or smaller group of individuals dominates the
Board’s decision-making process.
Board Composition and Balance
The Board currently comprises a majority of nonexecutive directors, with more than one-half of the Board
being independent directors. The Nominating Committee
reviews the independence of each director annually
based on the deﬁnition of independence as stated in the
Code to ensure that there is a strong and independent
element on the Board. According to the Code, an
“independent” director is one who has no relationship
with the company, its related companies or its ofﬁcers
that could interfere, or be reasonably perceived to
interfere, with the exercise of the director’s independent
business judgement with a view to the best interests of
the company. In addition, an independent director should
have no relationship with any substantial shareholder of
the Company.
When considering the independence of the directors, the
NC also reviews the annual declaration by the independent
non-executive directors regarding their independence
and the Directors’ disclosures of interests in transactions.
There are currently 11 members on the Board, three of
whom are executive directors and eight are non-executive
directors (inclusive of seven independent directors).
Although six of the independent directors have served for
more than nine years on the Board, they are considered
independent as the Board recognises that an individual’s
independence cannot be determined arbitrarily on the
basis of a set period of time. The Board is satisﬁed as
to the performance and continued independence of
judgment of each of these Directors. Further, the Board
WING TAI ANNUAL REPORT 2013
Chairman and Managing Director
The Chairman is also the Managing Director (“MD”) of the
Group and has overall responsibility for the management
and operation of the Group supported by the respective
Heads of Departments. The Board is also well balanced
with a strong and independent group of non-executive
directors to maintain its independence.
Mr Cheng Wai Keung’s primary role as Chairman is to
assist the Board in developing policies and strategies and
ensuring that they are implemented effectively. Mr Cheng
also provides leadership to the Board and ensuring
that Board meetings are held when necessary and that
Board members are provided with complete, adequate
and timely information. As MD, he makes key decisions
on the management and operations of the Group and is
responsible for the conduct of the business and affairs
of the Group, supported by the respective Heads of
Departments. The sustained growth of the Company
under Mr Cheng’s leadership shows his ability to discharge
the responsibilities of both roles effectively.
BOARD COMMITTEES
To assist the Board in the execution of its responsibilities,
the Board delegates speciﬁc functions to the various Board
committees in execution of its responsibilities, namely,
Audit, Nominating and Remuneration Committees. Each
of these committees has its own terms of reference and
reports its activities regularly to the Board.
15
Nominating Committee
Board Membership
The Nominating Committee (“NC”) comprises four
members, namely, Mr Lee Han Yang – Chairman of NC,
Tan Sri Dato’ Mohamed Noordin bin Hassan, Mr Loh
Soo Eng (all of whom are independent non-executive
directors) and Mr Cheng Wai Keung.
The NC has adopted speciﬁc written terms of
reference. The principal functions of the NC are to make
recommendations to the Board for the appointment
and re-appointment of directors to the Board and to
review the independence of each director annually. The
NC will review the composition of the Board and Board
Committees from time to time and to search and identify
suitable candidates with the right qualiﬁcations, expertise
and experience. Each candidate will be evaluated based on
his ability to enhance the Board through his contributions
in his area of expertise and to improve the Group’s
business strategies, controls or corporate governance.
All directors are required to submit themselves for renomination and re-election once every three years. At
least one-third of the directors retire at each Annual
General Meeting (“AGM”) subject to re-election annually.
Directors above the age of 70 are also required under
the Companies Act to retire and offer themselves for reappointment by the shareholders at every AGM.
assistance from the Management, who provides relevant
and complete information on a regular basis for effective
discharge of his/her duties.
Access to Information
Prior to each meeting and when the need arises, the
Board is furnished with timely and adequate information
to enable full deliberation of issues to be considered.
To ensure that the Board is able to fulﬁll its responsibilities,
the Management provides the Board with periodic
management reports, forecasts/budgets, ﬁnancial
statements and other relevant information of the Group.
The Board has independent access to the Management
and the Company Secretary at all times. The Board
seeks independent professional advice at the Company’s
expense as and when necessary to enable the Directors
(whether individually or as a group) to discharge their
responsibilities effectively.
The Company Secretary attends all Board meetings
and ensures that Board procedures are followed. The
Company Secretary together with the Management also
ensure that the Company complies with all applicable
statutory and regulatory rules.
REMUNERATION MATTERS
Remuneration Committee
Key information on the Directors are set out on pages 9
to 11 of this Annual Report.
Board Performance
The NC’s assessment of the effectiveness and performance
of the Board as a whole is conducted on an annual
basis taking into account the level of participation and
contribution of individual directors towards the Board’s
effectiveness and competencies, strategic insight, ﬁnancial
literacy, business judgment, sense of accountability and
maintenance of expertise relevant to the Group. The aim
of the evaluation is to assess if each director continues to
contribute effectively and demonstrate commitment to
their respective roles. When a director serves on multiple
boards, that director is to ensure that sufﬁcient time and
efforts are allocated to the affairs of each company with
The Remuneration Committee (“RC”) comprises four
members, all of whom, including the Chairman, are
independent non-executive directors. The RC members
are Mr Loh Soo Eng - Chairman of RC, Mr Boey Tak Hap,
Tan Sri Dato’ Mohamed Noordin bin Hassan and Mr Phua
Bah Lee.
The RC reviews and recommends to the Board the
remuneration of Directors and key executives of the
Group and obtains advice on remuneration matters as
and when required from human resource advisers. The RC
reviews the structure of the remuneration package for the
Directors and key executives to ensure that the package is
competitive and sufﬁcient to attract, retain and motivate
key executives. The review by the RC covers all aspects of
WING TAI ANNUAL REPORT 2013
16
remuneration, including but not limited to director’s fees,
salaries, allowances, bonuses and share plans. No Director
is involved in deciding his/her own remuneration.
Directors who participate in Board Committees receive
higher fees for the additional responsibilities. All Directors’
fees are approved by shareholders at the Annual General
Meeting of the Company before they are paid.
The breakdown of the remuneration of the top six key
executives (one of whom is related to the Managing
Director) in bands of $250,000 for FY2013 is set out below.
A signiﬁcant portion of the key executives’ remuneration
is linked to corporate and individual performance.
Salary (%)
Bonus,
Allowance &
Other Beneﬁts
(%)
Above $750,000
Dato’ Roger Chan Wan Chung
Helen Chow
Helen Khoo
Ng Kim Huat
40
38
33
40
60#
62
67^
60^
$500,000 to $750,000
Len Siew Lian
Karine Lim
40
39
60^
61^
Remuneration Bands
The Company uses the Wing Tai Performance Share Plan
(“Wing Tai PSP”) and the Wing Tai Restricted Share Plan
(“Wing Tai RSP”) to incentivise employees and directors.
The performance conditions in the Wing Tai PSP are
stretched targets aimed at sustaining longer-term growth.
The performance conditions under the Wing Tai RSP are
shorter term targets aimed at encouraging continued
service. Under the Wing Tai PSP, performance conditions
are set over a three-year performance period. Under the
Wing Tai RSP, the shares have a vesting schedule of three
years. Other than the restricted shares and performance
shares (“Shares”) granted to Ms Tan Hwee Bin, no Shares
nor share options were granted to the rest of the Directors
during the ﬁnancial year.
The breakdown (in percentage terms) of the Directors’
remuneration for FY2013 are as follows:
Remuneration
Bands
Bonus,
Allowance &
Other Beneﬁts
(%)
Shares
granted
during
the year
Fees
(%)
Salary
(%)
$4,000,001 to $4,250,000
Cheng Wai Keung
Edmund Cheng Wai Wing
—
—
30
27
70#
73#
—
—
$1,750,001 to $2,000,000
Tan Hwee Bin
—
27
73^
183,000
100
100
—
—
—
—
—
—
62#
100
87
100
100
100
—
—
—
—
—
—
38#
—
13
—
—
—
—
—
—
—
—
—
Below $250,000
Boey Tak Hap
Cheng Man Tak
Tan Sri Dato’ Mohamed
Noordin bin Hassan
Lee Han Yang
Lee Kim Wah
Loh Soo Eng
Phua Bah Lee
Paul Tong Hon To
#
^
Includes allowance and other beneﬁts from Wing Tai Malaysia Berhad.
Includes the fair values of restricted shares and performance shares
(where applicable).
There is also an employee who is related to the Deputy
Chairman, whose remuneration exceeded $150,000
during FY2013.
ACCOUNTABILITY AND AUDIT
Accountability
In presenting the annual ﬁnancial statements and
announcements of ﬁnancial results to shareholders,
it is the aim of the Board to provide shareholders with
a balanced and understandable assessment of the
Company’s performance, ﬁnancial position and prospects
on a quarterly basis, as well as other price-sensitive public
reports, and reports to regulators, if required.
The Board is furnished with periodic management
reports which present a balanced and understandable
assessment of the Company and its businesses, and
all other information that enable the Board to make a
balanced and informed assessment of the Company’s
performance, position and prospects.
Audit Committee
#
^
Includes fees, allowance and other beneﬁts from Wing Tai
Malaysia Berhad.
Includes the fair values of restricted shares and performance shares
(where applicable).
WING TAI ANNUAL REPORT 2013
The Audit Committee (“AC”) comprises four members, all
of whom are independent non-executive directors. The
AC members are Mr Paul Tong Hon To - Chairman of AC,
Mr Boey Tak Hap, Mr Lee Han Yang and Mr Phua Bah Lee.
17
The Board considers the members of the AC appropriately
qualiﬁed to discharge their responsibilities of the AC.
The majority of the members of the AC, including the
Chairman, have sufﬁcient accounting and ﬁnancial
management expertise and experience. The AC held four
meetings in FY2013. The AC meetings were held with the
internal and external auditors without the presence of the
Management once during the year.
The AC is guided by the written terms of reference setting
out its authority and duties. The AC has explicit authority
to investigate any matter within its terms of reference, full
access to and co-operation by the Management and full
discretion to invite any Director or executive ofﬁcer to
attend its meeting, and reasonable resources to enable it
to discharge its functions properly.
The AC maintains a high standard of corporate
governance and risk management by reviewing the
annual audit plan, internal audit process, the adequacy
of internal controls and interested person transactions.
The AC also reviews the quarterly and annual ﬁnancial
statements before submitting to the Board for approval.
Any changes to accounting standards and issues which
have a direct impact on ﬁnancial statements will be raised
at such meetings.
The AC meets on a periodic basis to perform, inter
alia, the following: to recommend the appointment,
reappointment and removal of the external auditor,
to review the scope, results of the audit and its cost
effectiveness, and objectivity of the external auditors.
Having reviewed the value of non-audit services by the
external auditors to the Group, the AC is satisﬁed that the
nature and extent of such services will not prejudice the
independence and objectivity of the external auditors.
The aggregate amount of fees, broken down into audit
and non-audit services provided by the auditors to the
Company for FY2013 is disclosed on page 57 of this
Annual Report.
The Group has complied with Rule 712 and 715 of the Listing
Manual issued by the Singapore Exchange Securities
Trading Limited in relation to its external auditors.
Risk Management / Internal Controls
The Board recognises the importance of sound internal
controls and risk management practices in relation to
good corporate governance. The Group’s internal
controls provide reasonable assurance that assets are
safeguarded, proper accounting records are maintained,
ﬁnancial information are reliable and applicable laws and
regulations are properly complied with.
The Board ensures the Management maintains a sound
system of internal controls, including ﬁnancial, operational
and compliance. The Board has the AC to review and
report annually on the adequacy and effectiveness of the
controls and assist it in its risk management oversight.
The Group has a risk management framework to provide
the Board with a Group-wide view of the risks in the
respective business units. As part of the framework, a risk
register was set up to document the identiﬁed risks and
mitigating actions. The procedures and processes within
the framework allow the Group to regularly review the
signiﬁcance and adequacy of its key risks, consider the
effectiveness of the Group’s system of internal controls
to limit, mitigate and monitor identiﬁed risks and the
implementation of further action plans to manage
strategic business risks.
As part of the continuing efforts in improving the risk
management policies and systems, the Group, with the
assistance of KPMG Risk Consulting, review the Group’s
existing internal controls and the risk register on a
regular basis. Dialogue sessions are carried out with the
Management to identify, assess and prioritise the risks
with each risk owner. Mitigating actions in managing the
key risks, as well as action plans to address the gaps are
considered and documented.
Risk tolerance limits are set to align with the risk appetite
and are subject to review annually. Operating within
risk tolerances provides the Management with greater
assurance that the Group remains within its risk appetite.
The key and material risks below are managed within the
Group’s risk management framework:
Financial Risks
The Group’s operations and the use of ﬁnancial instruments
exposed it to ﬁnancial risks, including currency risk,
interest rate risk, credit risk, liquidity risk and capital risk.
The Group seeks to minimise any adverse effects from the
unpredictability of ﬁnancial markets through identifying
WING TAI ANNUAL REPORT 2013
18
and evaluating such exposures and establishing policies
to monitor and manage these ﬁnancial risks. Further
details on ﬁnancial risk management are stipulated
in the notes to ﬁnancial statements under “Financial
Risk Management”.
Operational Risks
The Group is exposed to operational risks relating to
product and service quality assurance, cost control,
sales and marketing, leasing and ﬁnancial control.
Identiﬁcation and assessment of such risks are essential
for the management and mitigation of these risks. The
implementation and use of a system of internal controls,
operating, reporting and monitoring processes and
procedures, supported by information technology systems
and human resource skills, are important elements of the
risk management framework.
The Group has put in place a policy on whistle-blowing
to facilitate the reporting of activities or practices
which are in violation of the Group’s work rules. The
AC has the responsibility of overseeing this policy,
which is administered with the assistance of the internal
auditors. The process of raising the concerns has been
communicated to all employees. It is believed that this will
encourage openness, promote transparency and act as a
form of check and balance against the internal controls
and risk management practices of the Group.
Interested Person Transaction
The Company has established an internal policy for
transactions with interested persons and has set out the
procedures for review and approval of the Company’s
interested person transactions (IPT). During FY2013,
there is no IPT.
Compliance Risks
Internal Audit
The Group has a robust system in meeting the relevant
authorities’ regulatory requirement, and this is built in the
operating process at various stages. When necessary,
external expertises are sought. The Group also maintains
close working relationships with business associates and
regulators to anticipate change and adjust business plans
as and when required.
The internal audit function of the Group is carried out
by KPMG Services Pte Ltd (“KPMG”). KPMG, the internal
auditors (“IA”), carry out their work based on the Standards
for the Professional Practice of Internal Auditing set by
The Institute of Internal Auditors.
Based on the internal controls established and the reviews
conducted by the internal and external auditors and the
existing management controls in place, the Board, with
the concurrence of the AC, is satisﬁed that there are
adequate internal controls and risk management systems
in place within the Group addressing material ﬁnancial,
operational and compliance risks to meet the needs of
the Group in its current business environment as at 30
June 2013.
The system of internal controls established by the Group
provides reasonable, but not absolute, assurance that
the Group will not be adversely affected by any event
that can be reasonably foreseen as it strives to achieve
its business objectives. The Board, however, notes that
no system of internal controls can provide absolute
assurance in this regard, or absolute assurance against
poor judgement in decision making, human error, losses,
fraud or other irregularities.
WING TAI ANNUAL REPORT 2013
The IA reports directly to the Chairman of the AC. The
AC ensures that the internal auditors are adequately
resourced and has appropriate standing within the
Company and ensures, on an annual basis, the adequacy
of the internal audit function.
A set of internal controls which sets out approval limits for
expenditure, investments and divestments and cheque
signatory arrangements is adopted by the Company. The
IA assists the AC in its functions by reporting their audit
ﬁndings to the AC and to the Management.
The scope of the IA is to perform detailed work to assist
the AC and the Board in the evaluation of internal controls
and risk management. The IA submits its plans and
recommendations to the AC for approval. The AC reviews
the adequacy of the internal audit function through a
review of activities carried out by the IA on a quarterly
basis and is satisﬁed that there are adequate internal
controls in the Company.
19
COMMUNICATION WITH SHAREHOLDERS
DEALINGS IN SECURITIES
In line with the disclosure obligations under the SGXST Listing Rules and the Companies Act, the Company
promptly informs shareholders of all major developments
that impact the Group. Shareholders are updated on the
business and affairs of the Company through the quarterly
release of the Company’s results. Material and pricesensitive information is publicly released by the Company
via SGXNET on an immediate basis where required by
the Singapore Exchange Securities Trading Limited (SGXST). The Company does not practise selective disclosure.
Timely and detailed disclosure of pertinent corporate
information is communicated via SGXNET and the
Company’s website.
The Company has adopted and implemented an internal
guideline on share dealings in the Company’s securities
in compliance with Rule 1207(19)(c) of the Listing Manual
of the SGX-ST. All the ofﬁcers of the Company are
prohibited from dealing in securities of the Company while
in possession of price-sensitive information. They are also
prohibited from dealing in securities of the Company
during the closed period, which is two weeks before the
date of announcement of results for each of the ﬁrst three
quarters of the Company’s ﬁnancial year and one month
before the date of announcement of the full-year ﬁnancial
results. In addition, ofﬁcers of the Company are also
discouraged from dealing in the Company’s securities on
short-term considerations.
All shareholders receive the annual report of the Company
and notice of the AGM. The notice (also advertised in
the press) and results are published via SGXNET. To
address shareholders’ concerns and share views, the
Company also conducts media and analysts brieﬁng for
its full-year results to provide market updates on the
Group’s business.
Shareholders are given the opportunity to raise relevant
questions and communicate their views at general
meetings. A shareholder can vote in person or by way of
proxy at general meetings.
The Company’s website is at www.wingtaiasia.com.sg.
The Company’s latest ﬁnancial results and annual reports
are available on the Company’s website. If shareholders
have any queries on investor relations, they may contact
[email protected].
WING TAI ANNUAL REPORT 2013
20
Calendar
of Events
JULY 2012
Associate of the Arts Award
conferred by National Arts Council,
Singapore
Topping out of Verticas Residences,
Malaysia
Acquired prime residential land in
Shanghai Baoshan District, China
Total Defence Awards for Meritorious
Defence Partner Award (MDPA),
conferred by MINDEF, Singapore
Retail division awarded Singapore
Quality Award at Business Excellence
Awards, Singapore
AUGUST 2012
Retail division won close to 150
Excellent Service Awards (EXSA),
Singapore
Announcement of full year results
for year ended 30 June 2012
Ben Sherman launched in
Kuala Lumpur, Malaysia
SEPTEMBER 2012
Joint venture agreement signed with
Metro Australia Holdings and Maxdin
to develop Prince Charles Crescent
site, Singapore
Retail division moved into new ofﬁce
premises at Ang Mo Kio
DECEMBER 2012
Topping out of L’Viv, Singapore
Participated in Boys’ Brigade
Share-A-Gift project to help the
needy members in the community,
Singapore
OCTOBER 2012
48th Annual General Meeting,
Singapore
Helios Residences won High-Rise
Residential Award at FIABCI
Property Awards, Singapore
JANUARY 2013
Ascentia Sky won Bronze award for
Best Residential Development at
MIPIM Asia Awards, Hong Kong
WING TAI ANNUAL REPORT 2013
Groundbreaking of The Tembusu,
Singapore
Opened Adolfo Dominguez boutique
store at Paragon, Singapore
Retail division clinched two awards
at Singapore Service Excellence
Medallion Award – Organisation
Commendation Award for Service
Leadership and the Pinnacle
Individual Service Professional Award
MAY 2013
Helios Residences and Belle Vue
Residences won Gold Award and
Certiﬁed Award respectively at BCA
Universal Design (UD) Mark Award,
Singapore
Helios Residences clinched
Highly Commended for High-Rise
Architecture at The Asia Paciﬁc
Property Awards, Malaysia
Ascentia Sky obtained Temporary
Occupation Permit, Singapore
Etam opened stores at Wisma Atria
and Rafﬂes City, Singapore
Verticas Residences obtained
Temporary Occupation Permit,
Malaysia
JUNE 2013
MARCH 2013
i.t opened its store at Wisma Atria,
Singapore
NOVEMBER 2012
Helios Residences clinched Highly
Commended for Best Condo
Development and Best Residential
Architectural Design; Belle Vue
Residences won Highly Commended
for Green Development at South East
Asia Property Awards, Singapore
APRIL 2013
Topping out of Foresque Residences
and Le Nouvel Ardmore, Singapore
Participated in Earth Hour
Singapore to support
environmental sustainability
Groundbreaking of Prince Charles
Crescent site, Singapore
Retail division participated in
donation drives for Sichuan
Earthquake charity project,
Singapore
21
Financial
Reports
FOR THE FINANCIAL YEAR 2013
22
FIVE-YEAR FINANCIAL SUMMARY
23
DIRECTORS’ REPORT
30
STATEMENT BY DIRECTORS
31
INDEPENDENT AUDITOR’S REPORT
32
CONSOLIDATED INCOME STATEMENT
33
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
34
STATEMENTS OF FINANCIAL POSITION
35
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
37
CONSOLIDATED STATEMENT OF CASH FLOWS
39
NOTES TO THE FINANCIAL STATEMENTS
115
SHAREHOLDING STATISTICS
WING TAI ANNUAL REPORT 2013
22
Five-year Financial Summary
2013
$’000
20121
$’000
20111
$’000
2010
$’000
2009
$’000
1,332,500
1,115,041
210,020
7,439
624,888
401,810
216,462
6,616
751,109
540,185
202,350
8,574
821,851
626,709
179,683
15,459
501,843
324,605
160,934
16,304
Proﬁt before income tax
690,817
317,821
465,675
274,823
39,960
Proﬁt after income tax, but before
non-controlling interests
587,891
284,134
407,691
222,018
28,995
Proﬁt attributable to equity holders
of the Company
531,126
262,366
371,377
160,750
20,982
2,840,640
2,230,989
1,996,704
1,613,216
1,575,916
4,977,772
4,008,341
3,785,992
3,573,473
3,268,935
2,137,132
1,777,352
1,789,288
1,960,257
1,693,019
Earnings per share2 (cents)
67.81
33.60
47.66
20.66
2.68
Net tangible assets per share ($)
3.62
2.85
2.56
2.07
2.03
Cash dividends per share (cents)
12.00
7.00
7.00
5.00
4.00
Revenue
Property
Retail
Investment and others
Shareholders’ equity
Total assets
Total liabilities and non-controlling interests
Notes:
1.
From 1 July 2012, the Group adopted the Amendments to FRS 12 Deferred Tax: Recovery of Underlying Assets. The
change in accounting policy has been applied retrospectively. The 2012 income statement, and the 2011 and 2012
statements of ﬁnancial position have been restated, as disclosed in pages 39 and 40 of the ﬁnancial statements.
Consequently, the affected ﬁnancial ratios have been restated accordingly.
2. The number of shares used for this purpose are as follows:
2013
2012
2011
2010
2009
WING TAI ANNUAL REPORT 2013
’000
783,216
780,803
779,181
777,945
782,796
23
Directors’ Report
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
The directors present their report to the members together with the audited ﬁnancial statements of the Group for the
ﬁnancial year ended 30 June 2013 and the statement of ﬁnancial position of the Company as at 30 June 2013.
DIRECTORS
The directors of the Company at the date of this report are:
Cheng Wai Keung
(Chairman and Managing Director)
Edmund Cheng Wai Wing
(Deputy Chairman and Deputy Managing Director)
Boey Tak Hap
Cheng Man Tak
Tan Sri Dato’ Mohamed Noordin bin Hassan
Lee Han Yang
Lee Kim Wah
Loh Soo Eng
Phua Bah Lee
Paul Tong Hon To
Tan Hwee Bin
ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE SHARES AND DEBENTURES
Except as disclosed in the “Share Options” and “Share Plans” sections of this report, neither at the end of nor at any
time during the ﬁnancial year was the Company a party to any arrangement, whose object was to enable the directors
of the Company to acquire beneﬁts through the acquisition of shares in, or debentures of, the Company or any other
body corporate.
WING TAI ANNUAL REPORT 2013
24
Directors’ Report
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
DIRECTORS’ INTERESTS IN SHARES OR DEBENTURES
(a)
The interests of the directors holding ofﬁce at the end of the ﬁnancial year in the shares, share options and share
plans of the Company and related corporations according to the register of the directors’ shareholdings were
as follows:
Holdings registered
in the name of director
Holdings in which a director
is deemed to have an interest
As at
01.07.2012
As at
30.06.2013
As at
21.07.2013
Ordinary Shares
Cheng Wai Keung
Edmund Cheng Wai Wing
Lee Han Yang
Lee Kim Wah
Loh Soo Eng
Phua Bah Lee
Tan Hwee Bin
—
—
330,000
937,600
412,800
275,000
449,100
—
—
280,500
796,960
412,800
233,750
601,635
—
—
280,500
796,960
412,800
233,750
601,635
Share Options
Lee Kim Wah
Tan Hwee Bin
409,200
390,500
409,200
390,500
409,200
390,500
—
—
—
—
—
—
Restricted Share Plan
Tan Hwee Bin
397,900
342,500
342,500
—
—
—
Performance Share Plan *
Tan Hwee Bin
170,000
189,000
189,000
—
—
—
Share Options
Cheng Wai Keung
Edmund Cheng Wai Wing
800,000
800,000
800,000
800,000
800,000
800,000
—
—
—
—
—
—
Restricted Share Plan
Cheng Wai Keung
Edmund Cheng Wai Wing
—
—
53,000
53,000
53,000
53,000
—
—
—
—
—
—
Name of directors
As at
01.07.2012
As at
30.06.2013
As at
21.07.2013
326,831,564 395,038,656 395,038,656
310,601,664 310,601,664 310,601,664
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Related corporation
Wing Tai Malaysia Berhad
*
(b)
Shares awarded are contingent upon achievement of threshold targets.
By virtue of Section 7 of the Companies Act (Cap. 50), Cheng Wai Keung and Edmund Cheng Wai Wing, who
by virtue of their interest of not less than 20% in the issued capital of the Company, are also deemed to have an
interest in the shares of the various subsidiary companies held by the Company.
WING TAI ANNUAL REPORT 2013
25
Directors’ Report
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
DIRECTORS’ CONTRACTUAL BENEFITS
Since the end of the preceding ﬁnancial year, no director has received or become entitled to receive a beneﬁt by reason
of a contract made by the Company or a related corporation with the director or with a ﬁrm of which he is a member or
with a company in which he has a substantial ﬁnancial interest, except as disclosed in Note 33 to the ﬁnancial statements.
SHARE OPTIONS
(a)
The Wing Tai Holdings Limited (2001) Share Option Scheme (the “Scheme”)
The Scheme was approved and adopted by the members of the Company at an Extraordinary General Meeting
(“EGM”) held on 31 August 2001. The Scheme was terminated by the members of the Company at an EGM held
on 30 October 2008 (without prejudice to the rights of holders of options thereunder in respect of options which
have been granted).
The Scheme is administered by a committee comprising two directors, namely Cheng Wai Keung and Tan Hwee Bin.
No option was granted under the Scheme during the ﬁnancial year. No controlling shareholder of the Company
or his associate participated in the Scheme.
The aggregate number of options granted since the commencement of the Scheme to the end of the ﬁnancial
year is as follows:
Aggregate options since commencement
of the Scheme to 30.06.2013
Name of participants
Directors of the Company
Lee Kim Wah
Tan Hwee Bin
Group Executives
Total
Number of
Number of
Number of
options granted options exercised options forfeited
Aggregate
number of
outstanding
options as at
30.06.2013
877,200
645,500
468,000
255,000
—
—
409,200
390,500
1,522,700
11,686,600
723,000
5,785,500
—
3,204,500
799,700
2,696,600
13,209,300
6,508,500
3,204,500
3,496,300
Other than Lee Kim Wah, none of the participants of the Scheme received 5% or more of the total number of
options granted under the Scheme.
WING TAI ANNUAL REPORT 2013
26
Directors’ Report
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
SHARE OPTIONS (continued)
(a)
The Wing Tai Holdings Limited (2001) Share Option Scheme (the “Scheme”) (continued)
Details of the movement in the options granted under the Scheme on the unissued ordinary shares of the Company
during the year were as follows:
Date of grant
19.11.2004
30.09.2005
05.09.2006
06.09.2007
Total
(b)
As at
01.07.2012
Number
of options
exercised
Number
of options
forfeited
As at
30.06.2013
Exercise
price ($)
Expiry date
249,700
601,800
1,153,900
1,842,500
15,400
77,000
226,200
—
—
—
16,500
16,500
234,300
524,800
911,200
1,826,000
0.849
1.300
1.645
3.136
18.11.2014
29.09.2015
04.09.2016
05.09.2017
3,847,900
318,600
33,000
3,496,300
The Wing Tai Malaysia Berhad (“WTM”) Employees’ Share Option Scheme (the “ESOS”)
WTM, a subsidiary company of the Group, implemented the ESOS approved by the shareholders of WTM at an
EGM held on 11 May 2005.
The ESOS is administered by a committee comprising two directors of WTM, namely Cheng Wai Keung and Tan
Sri Dato’ Mohamed Noordin bin Hassan.
The directors (including non-executive directors) and employees of WTM who as at the date of offer are conﬁrmed
with at least one year of continuous service in WTM and its subsidiary companies are eligible to participate in the
scheme. The ESOS will allow granting of options to all eligible directors and employees by giving them the right
to subscribe for new shares of RM1.00 each, subject to the terms and conditions of the by-laws of the ESOS. The
details of the ESOS have been disclosed in the Directors’ Report of WTM.
Details of the movement in the options granted under the ESOS on the unissued ordinary shares of WTM during
the year were as follows:
Date of grant
As at
01.07.2012
Number
of options
exercised
Number
of options
forfeited
As at
30.06.2013
Exercise
price (RM)
Expiry date
01.12.2005
31.01.2007
19.05.2010
1,005,000
187,600
1,641,700
—
141,000
716,500
—
—
—
1,005,000
46,600
925,200
1.00
1.00
1.20
15.05.2015
15.05.2015
15.05.2015
Total
2,834,300
857,500
—
1,976,800
Except for the above, no other options were granted by the Company or any subsidiary companies during the
ﬁnancial year and there were no unissued shares under options at the end of the ﬁnancial year.
WING TAI ANNUAL REPORT 2013
27
Directors’ Report
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
SHARE PLANS
(a)
The Wing Tai Performance Share Plan (“Wing Tai PSP”) and the Wing Tai Restricted Share Plan (“Wing Tai RSP”)
The Wing Tai PSP and the Wing Tai RSP (collectively referred to as the “Wing Tai Share Plans”) were adopted by
the members of the Company at an EGM held on 30 October 2008.
The Wing Tai Share Plans are administered by a committee (the “Committee”) comprising two directors, namely
Cheng Wai Keung and Tan Hwee Bin.
(i)
Wing Tai PSP
One of the primary objectives of the Wing Tai PSP is to increase the Company’s ﬂexibility and effectiveness
in its continuous efforts to reward, retain and motivate key management staff. The Wing Tai PSP is primarily
targeted at executives in key positions who are able to drive the growth of the Company through innovation,
creativity and superior performance.
Full-time executives (including executive directors) of the Company, its subsidiary companies or associated
companies who hold such rank as may be designated by the Committee from time to time are eligible to
participate in the Wing Tai PSP.
Under the Wing Tai PSP, performance conditions are set over a three-year performance period. A speciﬁed
number of shares will be released by the Committee to the participants at the end of the performance
period, provided the threshold targets are achieved. The total number of shares released varies depending
on the achievement of pre-set performance targets over the performance period. The achievement factor
ranges from 0% to 200%.
Details of the movement in the awards of the Company during the year were as follows:
Date of grant
03.09.2009
01.09.2010
08.09.2011
19.09.2012
Total
(ii)
As at
01.07.2012
Number of
shares granted
Additional
shares awarded
arising from
targets achieved
100,000
121,000
183,000
—
—
—
—
147,000
1,100
—
—
—
101,100
—
—
—
—
121,000
183,000
147,000
404,000
147,000
1,100
101,100
451,000
Number of
shares released
As at
30.06.2013
Wing Tai RSP
The objective of the Wing Tai RSP is to serve as an additional motivational tool to recruit and retain employees.
Full-time executives (including executive directors) of the Company, its subsidiary companies or associated
companies who hold such rank as may be designated by the Committee from time to time and nonexecutive directors are eligible to participate in the Wing Tai RSP.
Under the Wing Tai RSP, performance conditions are set over a one-year performance period. A speciﬁed
number of shares will be awarded to eligible participants at the end of the performance period depending
on the extent of achievement of the performance conditions established. The shares have a vesting schedule
of three years. The participant will receive fully paid shares, without any cash consideration payable by
the participant.
WING TAI ANNUAL REPORT 2013
28
Directors’ Report
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
SHARE PLANS (continued)
(a)
The Wing Tai Performance Share Plan (“Wing Tai PSP”) and the Wing Tai Restricted Share Plan (“Wing Tai
RSP”) (continued)
(ii)
Wing Tai RSP (continued)
Details of the movement in the awards of the Company during the year were as follows:
Date of grant
03.09.2009
01.09.2010
08.09.2011
19.09.2012
Total
As at
01.07.2012
Number of
shares granted
Number of
Number of
shares released shares forfeited
As at
30.06.2013
447,600
1,314,600
1,937,000
—
—
—
—
1,815,000
447,600
563,400
573,600
—
—
—
34,100
6,000
—
751,200
1,329,300
1,809,000
3,699,200
1,815,000
1,584,600
40,100
3,889,500
The information on a director of the Company participating in the Wing Tai PSP and Wing Tai RSP is as follows:
Name of director
Tan Hwee Bin
Wing Tai PSP
Wing Tai RSP
(b)
Aggregate awards Aggregate awards
granted since
released since
Awards commencement of commencement of
granted during
plans to the
plans to the
the year
end of the year
end of the year
61,000
122,000
231,000
969,000
42,500
626,500
Aggregate awards
outstanding
as at the
end of the year
189,000
342,500
The Wing Tai Malaysia Restricted Share Plan (“WTM RSP”)
WTM implemented the WTM RSP approved by the shareholders of WTM at an EGM held on 29 November 2011.
The WTM RSP is administered by a committee comprising two directors of WTM, namely Cheng Wai Keung and
Tan Sri Dato’ Mohamed Noordin bin Hassan.
The employees and directors of WTM and its subsidiary companies but exclude subsidiary companies which
are dormant (the “WTM Group”) whose employment are conﬁrmed in writing on or before the date of offer, are
eligible to participate in the scheme.
The Restricted Share Award represents the right of a participant to receive fully paid shares on a vesting date,
their equivalent value or combinations thereof, without any cash consideration payable by the participant, upon
the participant achieving pre-determined performance conditions and/or otherwise having performed well and/
or made a signiﬁcant contribution to the WTM Group. The details of the WTM RSP have been disclosed in the
Directors’ Report of WTM.
Details of the movement in the awards of WTM during the year were as follows:
Date of grant
01.03.2013
WING TAI ANNUAL REPORT 2013
As at
01.07.2012
Number of
shares granted
Number of
shares forfeited
As at
30.06.2013
—
535,000
6,000
529,000
29
Directors’ Report
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
AUDIT COMMITTEE
The Audit Committee consists of four non-executive independent directors. The members of the Committee at the date
of this report are:
Paul Tong Hon To (Chairman)
Boey Tak Hap
Lee Han Yang
Phua Bah Lee
The Audit Committee reviewed the Group’s accounting policies and system of internal controls on behalf of the Board
of Directors and performed the functions speciﬁed in Section 201B(5) of the Companies Act (Cap. 50). In performing its
functions, the Committee reviewed:
(a)
the audit plans of the Company’s internal and external auditors and their evaluation of the system of internal
controls arising from their audit examinations;
(b)
the scope and results of internal audit procedures; and
(c)
the quarterly results and the full year consolidated ﬁnancial statements of the Group for the ﬁnancial year ended
30 June 2013 before their submission to the Board of Directors for approval and the auditor’s report on these
ﬁnancial statements.
The Audit Committee has nominated PricewaterhouseCoopers LLP for re-appointment as auditor of the Company at
the forthcoming Annual General Meeting.
INDEPENDENT AUDITOR
The independent auditor, PricewaterhouseCoopers LLP, has expressed its willingness to accept re appointment.
On behalf of the directors
CHENG WAI KEUNG
Director
12 September 2013
EDMUND CHENG WAI WING
Director
WING TAI ANNUAL REPORT 2013
30
Statement by Directors
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
In the opinion of the directors,
(a)
the statement of ﬁnancial position of the Company and the consolidated ﬁnancial statements of the Group as set
out on pages 32 to 114 are drawn up so as to give a true and fair view of the state of affairs of the Company and
of the Group as at 30 June 2013 and of the results of the business, changes in equity and cash ﬂows of the Group
for the ﬁnancial year then ended; and
(b)
at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its
debts as and when they fall due.
On behalf of the directors
CHENG WAI KEUNG
Director
12 September 2013
WING TAI ANNUAL REPORT 2013
EDMUND CHENG WAI WING
Director
31
Independent Auditor’s Report to
the Members of Wing Tai Holdings Limited
REPORT ON THE FINANCIAL STATEMENTS
We have audited the accompanying ﬁnancial statements of Wing Tai Holdings Limited (the “Company”) and its subsidiary
companies (the “Group”) set out on pages 32 to 114, which comprise the consolidated statement of ﬁnancial position
of the Group and the statement of ﬁnancial position of the Company as at 30 June 2013, the consolidated income
statement, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and
the consolidated statement of cash ﬂows of the Group for the ﬁnancial year then ended, and a summary of signiﬁcant
accounting policies and other explanatory information.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation of ﬁnancial statements that give a true and fair view in accordance
with the provisions of the Singapore Companies Act (the “Act”) and Singapore Financial Reporting Standards, and for
devising and maintaining a system of internal accounting controls sufﬁcient to provide a reasonable assurance that
assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised
and that they are recorded as necessary to permit the preparation of true and fair proﬁt and loss accounts and balance
sheets and to maintain accountability of assets.
Auditor’s Responsibility
Our responsibility is to express an opinion on these ﬁnancial statements based on our audit. We conducted our audit in
accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements
and plan and perform the audit to obtain reasonable assurance about whether the ﬁnancial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the ﬁnancial
statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of
material misstatement of the ﬁnancial statements, whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the entity’s preparation of ﬁnancial statements that give a true and fair view
in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating
the overall presentation of the ﬁnancial statements.
We believe that the audit evidence we have obtained is sufﬁcient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated ﬁnancial statements of the Group and the statement of ﬁnancial position of the Company
are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as
to give a true and fair view of the state of affairs of the Group and of the Company as at 30 June 2013, and of the results,
changes in equity and cash ﬂows of the Group for the ﬁnancial year ended on that date.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
In our opinion, the accounting and other records required by the Act to be kept by the Company and by those subsidiary
companies incorporated in Singapore, of which we are the auditors, have been properly kept in accordance with the
provisions of the Act.
PRICEWATERHOUSECOOPERS LLP
Public Accountants and Chartered Accountants
Singapore
12 September 2013
WING TAI ANNUAL REPORT 2013
32
Consolidated Income Statement
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
Group
2013
Note
Revenue
Cost of sales
3
$’000
2012
(restated)
$’000
1,332,500
(779,735)
624,888
(319,497)
552,765
305,391
71,526
18,493
Expenses
— Distribution
— Administrative and other
(97,605)
(91,239)
(95,637)
(62,740)
Operating profit
435,447
165,507
Gross profit
Other gains — net
Finance costs
4
7
(39,383)
(37,161)
Share of proﬁts of associated and joint venture companies
294,753
189,475
Profit before income tax
690,817
317,821
(102,926)
(33,687)
Total profit
587,891
284,134
Attributable to:
Equity holders of the Company
Non-controlling interests
531,126
56,765
262,366
21,768
587,891
284,134
37.50
67.81
19.45
33.60
37.23
67.27
19.33
33.36
Income tax expense
Basic earnings per share attributable to equity
holders of the Company (cents) based on:
Proﬁt before fair value gains on investment properties
Proﬁt after fair value gains on investment properties
Diluted earnings per share attributable to equity
holders of the Company (cents) based on:
Proﬁt before fair value gains on investment properties
Proﬁt after fair value gains on investment properties
WING TAI ANNUAL REPORT 2013
8(a)
9(a)
9(b)
33
Consolidated Statement of Comprehensive Income
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
Group
2013
Note
Total profit
Other comprehensive income/(expense):
Items that may be reclassified to profit or loss:
Cash ﬂow hedges
Currency translation differences
Share of other comprehensive income/(expense) of
associated and joint venture companies
Items that will not be reclassified to profit or loss:
Revaluation gains on property, plant and equipment
Share of revaluation gains on property, plant and
equipment of an associated company
Other comprehensive income, net of tax
Total comprehensive income
Attributable to:
Equity holders of the Company
Non-controlling interests
8(a)
$’000
2012
(restated)
$’000
587,891
284,134
8,864
10,716
13,668
3,350
8,230
(5,124)
27,810
11,894
63,362
9,489
2,138
695
65,500
10,184
93,310
22,078
681,201
306,212
625,039
56,162
285,189
21,023
681,201
306,212
WING TAI ANNUAL REPORT 2013
34
Statements of Financial Position
AS AT 30 JUNE 2013
2013
Group
2012
(restated)
$’000
2011
(restated)
$’000
$’000
$’000
504,235
212,651
18,784
1,238,805
5,758
56,678
606,280
300,447
—
—
—
4,602
441,660
436,899
—
—
—
4,462
2,122,852
2,036,911
911,329
883,021
3,189
292,373
1,043,593
207,299
—
562,153
131,693
7,170
205,461
736,367
161,432
—
578,085
196,974
7,170
197,790
602,498
189,769
—
560,210
191,644
3,189
661,805
—
—
252,392
—
8,020
3,189
452,565
—
—
252,392
—
7,828
2,240,300
1,885,489
1,749,081
925,406
715,974
4,977,772
4,008,341
3,785,992
1,836,735
1,598,995
325,082
72,683
88,249
230,005
83,561
25,749
222,338
81,808
167,126
160,857
8,879
—
162,980
5,879
—
486,014
339,315
471,272
169,736
168,859
11,786
1,350,568
62,267
40,057
20,669
1,199,986
17,137
33,407
34,116
1,012,091
39,818
44,611
257
570,000
—
—
3,503
370,000
—
—
1,464,678
1,271,199
1,130,636
570,257
373,503
Total liabilities
1,950,692
1,610,514
1,601,908
739,993
542,362
NET ASSETS
3,027,080
2,397,827
2,184,084
1,096,742
1,056,633
838,250
(45,637)
1,438,376
838,250
(71,590)
1,230,044
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Development properties
Tax recoverable
Other current assets
Non-current assets
Available-for-sale ﬁnancial assets
Trade and other receivables
Investment in an associated company
Investments in joint venture companies
Investments in subsidiary companies
Investment properties
Property, plant and equipment
Note
$’000
10
12
13
14
1,024,541
166,159
21,796
1,463,073
2,378
59,525
848,686
83,404
20,771
1,093,139
1,740
75,112
2,737,472
Company
2013
2012
15
16
17
18
19
20
21
22
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Current income tax liabilities
Borrowings
Non-current liabilities
Derivative ﬁnancial instruments
Borrowings
Deferred income tax liabilities
Other non-current liabilities
EQUITY
Capital and reserves attributable to
equity holders of the Company
Share capital
Other reserves
Retained earnings
23
24
11
24
8(b)
26
27
28
29
838,250
87,919
1,914,471
838,250
(490)
258,982
838,250
(6,821)
225,204
Non-controlling interests
2,840,640
186,440
2,230,989
166,838
1,996,704
187,380
1,096,742
—
1,056,633
—
TOTAL EQUITY
3,027,080
2,397,827
2,184,084
1,096,742
1,056,633
WING TAI ANNUAL REPORT 2013
35
Consolidated Statement of Changes in Equity
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
Attributable to equity holders of the Company
Note
2013
Beginning of ﬁnancial year,
as previously reported
Effect of adopting
Amendments to FRS 12
2.1
As restated
Total comprehensive income
Realisation of reserves
Cost of share-based payment
Reissuance of treasury shares
Ordinary and special
dividends paid
25
Dividends paid by subsidiary
companies to non-controlling
interests
Issue of shares by a subsidiary
company to non-controlling
interests
Acquisition of additional interest
in a subsidiary company
Acquisition by an associated
company of its non-controlling
interests
Waiver of loan from non-controlling
interests
End of financial year
Share
capital
$’000
Other
reserves
$’000
Retained
earnings
$’000
Total
$’000
Noncontrolling
interests
$’000
Total
equity
$’000
838,250
(40,751)
1,309,057
2,106,556
163,538
2,270,094
—
(4,886)
129,319
124,433
3,300
127,733
838,250
(45,637)
1,438,376
2,230,989
166,838
2,397,827
—
—
—
—
93,913
(92)
2,705
485
531,126
92
—
—
625,039
—
2,705
485
56,162
—
67
—
681,201
—
2,772
485
—
—
(54,838)
—
—
—
—
(276)
(276)
—
—
(9)
(9)
—
36,545
—
36,545
1,227
37,772
—
—
—
—
18,922
18,922
838,250
87,919
1,914,471
2,840,640
186,440
3,027,080
—
(54,838)
—
—
(57,449)
679
(6)
(54,838)
(57,449)
403
(15)
WING TAI ANNUAL REPORT 2013
36
Consolidated Statement of Changes in Equity
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
Attributable to equity holders of the Company
Note
2012
Beginning of ﬁnancial year,
as previously reported
Effect of adopting
Amendments to FRS 12
2.1
As restated
Total comprehensive income
Realisation of reserves
Cost of share-based payment
Reissuance of treasury shares
Ordinary and special
dividends paid
25
Dividends paid by subsidiary
companies to non-controlling
interests
Issue of shares by a subsidiary
company to non-controlling
interests
Acquisition of additional interest
in a subsidiary company
Liquidation of a subsidiary company
End of ﬁnancial year
Share
capital
$’000
Other
reserves
$’000
Retained
earnings
$’000
Total
$’000
Noncontrolling
interests
$’000
Total
equity
$’000
838,250
(64,067)
1,120,916
1,895,099
184,916
2,080,015
—
(7,523)
109,128
101,605
2,464
104,069
838,250
(71,590)
1,230,044
1,996,704
187,380
2,184,084
—
—
—
—
22,823
(75)
3,160
45
262,366
75
—
—
285,189
—
3,160
45
21,023
—
37
—
306,212
—
3,197
45
(54,660)
(54,660)
—
—
—
—
—
—
—
—
(83)
(83)
—
—
—
—
634
—
634
—
1,438,376
2,230,989
838,250
(45,637)
An analysis of the movements in each category within “Other reserves” is presented in Note 28.
WING TAI ANNUAL REPORT 2013
—
(34,392)
254
(2,172)
(5,292)
166,838
(54,660)
(34,392)
171
(1,538)
(5,292)
2,397,827
37
Consolidated Statement of Cash Flows
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
Group
2013
Note
Cash flows from operating activities
Total proﬁt
Adjustments for:
Income tax expense
Depreciation of property, plant and equipment
Write-off of property, plant and equipment
Impairment loss on property, plant and equipment
Dividend income
Fair value gains on investment properties
Fair value losses/(gains) on derivative ﬁnancial instruments
Allowance for stock obsolescence
Dilution loss on interest in an associated company
Gain on disposal of property, plant and equipment
Gain on liquidation of an available-for-sale ﬁnancial asset
Loss on disposal of investment property
Interest income
Interest expense
Share of proﬁts of associated and joint venture companies
Share-based payment
Translation differences
$’000
2012
(restated)
$’000
587,891
284,134
102,926
12,489
674
251
(104)
(52,112)
112
2,044
2,830
(204)
(5,696)
—
(11,018)
39,383
(294,753)
2,772
(1,891)
33,687
11,938
442
—
(91)
(15,713)
(368)
1,188
2,613
(1,489)
—
172
(8,058)
37,161
(189,475)
3,197
(17,807)
385,594
141,531
42,424
(132,080)
(3,112)
(48,000)
59,361
(1,373)
149,423
(3,259)
120,449
164
Cash generated from operations
Income tax paid
304,187
(66,353)
406,935
(61,261)
Net cash generated from operating activities
237,834
345,674
Operating cash ﬂow before working capital changes
Changes in operating assets and liabilities:
Balances with associated and joint venture companies
Development properties
Inventories
Trade and other receivables and other current assets
Trade and other payables and other non-current liabilities
WING TAI ANNUAL REPORT 2013
38
Consolidated Statement of Cash Flows
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
Group
2013
Note
Cash flows from investing activities
Acquisition of additional interest in a subsidiary company
Acquisition of interest in joint venture companies
Additional expenditure on investment property
Purchases of property, plant and equipment
Proceeds from disposal of investment property
Proceeds from disposal of property, plant and equipment
Net proceeds from liquidation of an available-for-sale ﬁnancial asset
Distribution to non-controlling interests upon liquidation of a
subsidiary company
(Advancement)/repayment of the loans to joint venture companies
Dividends received
Interest received
$’000
2012
(restated)
$’000
(15)
(16,145)
(612)
(19,883)
—
247
5,299
(3,221)
—
—
(9,265)
602
3,210
—
—
(120,637)
32,898
3,217
(5,292)
1,809
106,907
2,991
Net cash (used in)/generated from investing activities
(115,631)
Cash flows from financing activities
Proceeds from issue of ordinary shares by a subsidiary
company to non-controlling interests
Reissuance of treasury shares
Repayment of the loans from non-controlling interests
Proceeds from borrowings
Repayment of borrowings
Ordinary and special dividends paid
Dividends paid to non-controlling interests
Interest paid
403
485
(1,912)
264,990
(50,407)
(54,838)
(57,449)
(46,784)
171
45
(14,103)
274,737
(231,611)
(54,660)
(31,675)
(44,838)
Net cash generated from/(used in) financing activities
54,488
(101,934)
176,691
848,686
(836)
341,481
504,235
2,970
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of ﬁnancial year
Effects of currency translation on cash and cash equivalents
Cash and cash equivalents at end of financial year
WING TAI ANNUAL REPORT 2013
10
1,024,541
97,741
848,686
39
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
These notes form an integral part of and should be read in conjunction with the accompanying ﬁnancial statements.
1.
GENERAL INFORMATION
Wing Tai Holdings Limited (the “Company”) is incorporated and domiciled in Singapore and is listed on the
Singapore Exchange Securities Trading Limited. The address of its registered ofﬁce is 3 Killiney Road, #10-01
Winsland House I, Singapore 239519.
The principal activity of the Company is that of an investment holding company. The principal activities of the
Company’s subsidiary companies are shown in Note 35.
2.
SIGNIFICANT ACCOUNTING POLICIES
2.1
Basis of preparation
These ﬁnancial statements have been prepared in accordance with Singapore Financial Reporting Standards
(“FRS”). The ﬁnancial statements have been prepared under the historical cost convention, except as disclosed in
the accounting policies below.
The preparation of ﬁnancial statements in conformity with FRS requires management to exercise its judgement
in the process of applying the Group’s accounting policies. It also requires the use of accounting estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the ﬁnancial statements, and the reported amounts of revenues and expenses during
the ﬁnancial year. Although these estimates are based on management’s best knowledge of current events
and actions, actual results may ultimately differ from those estimates. The areas involving a higher degree of
judgement or complexity are disclosed in Notes 2.7, 2.8 and 8.
Amendments and interpretations to published standards effective in 2013
On 1 July 2012, the Group adopted the new or amended FRS and Interpretations to FRS (“INT FRS”) that are
mandatory for application from that date. Changes to the Group’s accounting policies have been made as required,
in accordance with the transitional provisions in the respective FRS and INT FRS.
The new or amended FRS and INT FRS that are relevant to the Group are as follows:
Amendments to FRS 1
Amendments to FRS 12
Presentation of Items of Other Comprehensive Income
Deferred Tax: Recovery of Underlying Assets
The adoption of the above new or amended FRS and INT FRS did not result in any signiﬁcant impact on the
ﬁnancial statements of the Group, except for Amendments to FRS 12 Deferred Tax: Recovery of Underlying Assets.
The Amendments to FRS 12 apply to the measurement of deferred tax liabilities and assets arising from investment
properties measured using the fair value model under FRS 40 Investment Property, including investment property
acquired in a business combination and subsequently measured using the fair value model. For the purposes of
measuring deferred tax, the Amendments have introduced a rebuttable presumption that the carrying amount
of an investment property measured at fair value will be recovered entirely through sale. The presumption can
be rebutted if the investment property is depreciable and is held within a business model whose objective is to
consume substantially all of the economic beneﬁts over time, rather than through sale.
WING TAI ANNUAL REPORT 2013
40
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.1
Basis of preparation (continued)
Amendments and interpretations to published standards effective in 2013 (continued)
The Group previously provided for deferred tax liabilities on the fair value gains of its investment properties
according to the income tax rate on the basis that the carrying amount of the investment properties will be
recovered through use. Upon the adoption of the Amendments to FRS 12, such deferred tax is measured according
to the capital gains tax rate on the basis of recovery through sale. Accordingly, there will be no deferred tax liability
on investment properties in Singapore and Hong Kong as there is no tax on capital gains in these countries.
The change in accounting policy has been applied retrospectively and the comparatives have been restated
accordingly. The effects on adoption are as follows:
Consolidated Income Statement
Group
2013
$’000
2012
$’000
Increase in share of proﬁts of associated and joint venture companies
(Increase)/decrease in income tax expense
39,344
(275)
17,638
3,271
Increase in total proﬁt
39,069
20,909
Increase in total proﬁt attributable to:
— Equity holders of the Company
— Non-controlling interests
38,528
541
20,191
718
39,069
20,909
4.92
4.89
2.58
2.57
Increase in:
— Basic earnings per share (cents)
— Diluted earnings per share (cents)
Statement of Financial Position
Increase/(decrease) in:
— Other reserves
— Retained earnings
— Non-controlling interests
— Investment in an associated company
— Deferred income tax liabilities
WING TAI ANNUAL REPORT 2013
2013
$’000
Group
2012
$’000
2011
$’000
(4,150)
167,847
3,855
118,625
(48,927)
(4,886)
129,319
3,300
78,481
(49,252)
(7,523)
109,128
2,464
58,222
(45,847)
41
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.2
Revenue recognition
Revenue for the Group comprises the fair value of the consideration received or receivable for the sale of goods
in the ordinary course of the Group’s activities. Revenue is presented, net of goods and services tax, rebates and
discounts, and after eliminating sales within the Group.
The Group recognises revenue when the amount of revenue and related cost can be reliably measured, it is
probable that the collectability of the related receivables will ﬂow to the entity and when the speciﬁc criteria for
each of the Group’s activities are met as follows:
(a)
Sale of goods
Revenue from the sale of goods is recognised when a Group entity has delivered the products to the
customer, the customer has accepted the products and collectability of the related receivable is reasonably
assured, except for income from the sale of development properties as disclosed in Note 2.8.
(b)
Rental income
Rental income from operating leases (net of any incentives given to the lessees) is recognised on a straightline basis over the lease term.
(c)
Management fee
Management fee comprises charges for the management and maintenance of properties and ﬁnance and
administration fees. Revenue from management fee is recognised when management services are rendered.
(d)
Dividend income
Dividend income is recognised when the right to receive payment is established.
(e)
Interest income
Interest income is recognised using the effective interest method.
2.3
Group accounting
(a)
Subsidiary companies
(i)
Consolidation
Subsidiary companies are entities over which the Group has power to govern the ﬁnancial and
operating policies, generally accompanied by a shareholding of more than one half of the voting
rights. The existence and effect of potential voting rights that are currently exercisable or convertible
are considered when assessing whether the Group controls another entity. Subsidiary companies are
consolidated from the date on which control is transferred to the Group. They are de-consolidated
from the date on which control ceases.
In preparing the consolidated ﬁnancial statements, transactions, balances and unrealised gains
on transactions between group entities are eliminated. Unrealised losses are also eliminated but
are considered an impairment indicator of the asset transferred. Accounting policies of subsidiary
companies have been changed where necessary to ensure consistency with the accounting policies
adopted by the Group.
WING TAI ANNUAL REPORT 2013
42
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.3
Group accounting (continued)
(a)
Subsidiary companies (continued)
(i)
Consolidation (continued)
Non-controlling interests are that part of the net results of operations and of net assets of a
subsidiary company attributable to the interests which are not owned directly or indirectly by the
equity holders of the Company. They are shown separately in the consolidated income statement,
consolidated statement of comprehensive income, consolidated statement of ﬁnancial position and
consolidated statement of changes in equity. Total comprehensive income is attributed to the noncontrolling interests based on their respective interests in a subsidiary company, even if this results
in the non-controlling interests having a deﬁcit balance.
(ii)
Acquisition of businesses
The acquisition method of accounting is used to account for business combinations by the Group.
The consideration transferred for the acquisition of a subsidiary company comprises the fair value
of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The
consideration transferred also includes the fair value of any contingent consideration arrangement
and the fair value of any pre-existing equity interest in the subsidiary company.
Acquisition-related costs are expensed as incurred.
Identiﬁable assets acquired and liabilities and contingent liabilities assumed in a business combination
are, with limited exceptions, measured initially at their fair values at the acquisition date.
On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the
acquiree at the date of acquisition either at fair value or at the non-controlling interest’s proportionate
share of the acquiree’s identiﬁable net assets.
The excess of the consideration transferred, the amount of any non-controlling interest in the
acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the
fair value of the identiﬁable net assets acquired is recorded as goodwill. Please refer to Note 2.4 for
the accounting policy on goodwill on acquisitions.
(iii)
Disposals of subsidiary companies or businesses
When a change in the Company’s ownership interest in a subsidiary company results in a loss of
control over the subsidiary company, the assets and liabilities of the subsidiary company including
any goodwill are derecognised. Amounts recognised in other comprehensive income in respect of
that entity are also reclassiﬁed to the income statement or transferred directly to retained earnings
if required by a speciﬁc FRS.
Any retained interest in the entity is remeasured at fair value. The difference between the carrying
amount of the retained investment at the date when control is lost and its fair value is recognised in
the income statement.
Please refer to Note 2.5 for the accounting policy on investments in subsidiary companies in the separate
ﬁnancial statements of the Company.
WING TAI ANNUAL REPORT 2013
43
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.3
Group accounting (continued)
(b)
Transactions with non-controlling interests
Changes in the Company’s ownership interest in a subsidiary company that do not result in a loss of control
over the subsidiary company are accounted for as transactions with equity owners of the Group. Any
difference between the change in the carrying amounts of the non-controlling interest and the fair value
of the consideration paid or received is recognised in a separate reserve within equity attributable to the
equity holders of the Company.
(c)
Associated and joint venture companies
Associated companies are entities over which the Group has signiﬁcant inﬂuence, but not control, generally
accompanied by a shareholding of between and including 20% and 50% of the voting rights. Joint venture
companies are entities over which the Group has contractual arrangements to jointly share the control over
the economic activity of the entities with one or more parties.
Investments in associated and joint venture companies are accounted for in the consolidated ﬁnancial
statements using the equity method of accounting less impairment losses, if any.
Investments in associated and joint venture companies are initially recognised at cost. The cost of an
acquisition is measured at the fair value of the assets given, equity instruments issued or liabilities incurred or
assumed at the date of exchange, plus costs directly attributable to the acquisition. Goodwill on associated
and joint venture companies represents the excess of the cost of acquisition of the associated and joint
venture companies over the Group’s share of the fair value of the identiﬁable net assets of the associated
and joint venture companies and is included in the carrying amount of the investments. Please refer to Note
2.4 for the accounting policy on goodwill on acquisitions.
In applying the equity method of accounting, the Group’s share of its associated and joint venture
companies’ post-acquisition proﬁts or losses are recognised in the income statement and its share of
post-acquisition other comprehensive income is recognised in other comprehensive income. These postacquisition movements and distributions received from the associated and joint venture companies are
adjusted against the carrying amount of the investments. When the Group’s share of losses in an associated
or joint venture company equals or exceeds its interest in the associated or joint venture company, including
any other unsecured non-current receivables, the Group does not recognise further losses, unless it has
obligations or has made payments on behalf of the associated or joint venture company.
Unrealised gains on transactions between the Group and its associated and joint venture companies are
eliminated to the extent of the Group’s interest in the associated and joint venture companies. Unrealised
losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
The accounting policies of associated and joint venture companies have been changed where necessary to
ensure consistency with the accounting policies adopted by the Group.
Gains and losses arising from partial disposals or dilutions in investments in associated and joint venture
companies are recognised in the income statement.
Investments in associated and joint venture companies are derecognised when the Group loses signiﬁcant
inﬂuence. Any retained interest in the entity is remeasured at its fair value. The difference between the
carrying amount of the retained investment at the date when signiﬁcant inﬂuence is lost and its fair value
is recognised in the income statement.
Please refer to Note 2.5 for the accounting policy on investments in associated and joint venture companies
in the separate ﬁnancial statements of the Company.
WING TAI ANNUAL REPORT 2013
44
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.4
Goodwill on acquisitions
Goodwill on acquisitions of subsidiary companies on or after 1 July 2009 represents the excess of the consideration
transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any
previous equity interest in the acquiree over the fair value of the identiﬁable net assets acquired.
Goodwill on acquisitions of subsidiary companies prior to 1 July 2009 and on acquisitions of associated and joint
venture companies represent the excess of the cost of the acquisitions over the fair value of the Group’s share of
the identiﬁable net assets acquired.
Goodwill on subsidiary companies is recognised separately as intangible assets and carried at cost less accumulated
impairment losses. Goodwill on associated and joint venture companies is included in the carrying amount of
the investments.
Gains and losses on the disposal of subsidiary, associated and joint venture companies include the carrying
amount of goodwill relating to the entity sold, except for goodwill arising from acquisitions prior to 1 July 2001.
Such goodwill was adjusted against retained earnings in the year of acquisition and is not recognised in the
income statement on disposal.
2.5
Investments in subsidiary, associated and joint venture companies
Investments in subsidiary, associated and joint venture companies are carried at cost less accumulated impairment
losses in the Company’s statement of ﬁnancial position. On disposal of investments in subsidiary, associated and
joint venture companies, the difference between disposal proceeds and the carrying amounts of the investments
are recognised in the income statement.
2.6
Property, plant and equipment
(a)
Measurement
(i)
Land and buildings
Land and buildings are initially recognised at cost.
Freehold and 999-year leasehold land are subsequently carried at the revalued amounts less
accumulated impairment losses. Buildings and leasehold land are subsequently carried at the
revalued amounts less accumulated depreciation and accumulated impairment losses.
Land and buildings are revalued by independent professional valuers once every three years and
whenever their carrying amounts are likely to differ materially from their revalued amounts. When
an asset is revalued, any accumulated depreciation at the date of revaluation is eliminated against
the gross carrying amount of the asset. The net amount is then restated to the revalued amount of
the asset.
Increases in carrying amounts arising from revaluation, including currency translation differences,
are recognised in other comprehensive income, unless they offset previous decreases in the
carrying amounts of the same asset, in which case, they are recognised in the income statement.
Decreases in carrying amounts that offset previous increases of the same asset are charged
against other comprehensive income. All other decreases in carrying amounts are recognised in the
income statement.
WING TAI ANNUAL REPORT 2013
45
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.6
Property, plant and equipment (continued)
(a)
Measurement (continued)
(ii)
(iii)
(b)
Other property, plant and equipment
All other items of property, plant and equipment are initially recognised at cost and subsequently
carried at cost less accumulated depreciation and accumulated impairment losses.
Components of costs
The cost of an item of property, plant and equipment initially recognised includes its purchase price
and any cost that is directly attributable to bringing the asset to the location and condition necessary
for it to be capable of operating in the manner intended by management, including borrowing costs
that are directly attributable to the acquisition, construction or production of a qualifying asset.
The projected cost of dismantlement, removal or restoration is also recognised as part of the cost
of property, plant and equipment if the obligation for the dismantlement, removal or restoration is
incurred as a consequence of either acquiring the asset or using the asset for purposes other than
to produce inventories.
Depreciation
Freehold and 999-year leasehold land are not depreciated. Depreciation on other items of property, plant
and equipment is calculated using the straight-line method to allocate their depreciable amounts over their
estimated useful lives. The annual depreciation rates are as follows:
Buildings and leasehold land
Motor vehicles
Ofﬁce equipment
Furniture and ﬁttings
1 – 3% or over the remaining lease period, whichever is shorter
20%
10 – 33%
10% or over the remaining lease period, whichever is shorter
The residual values, estimated useful lives and depreciation method of property, plant and equipment are
reviewed, and adjusted as appropriate, at the end of each reporting period. The effects of any revision are
recognised in the income statement when the changes arise.
(c)
Subsequent expenditure
Subsequent expenditure relating to property, plant and equipment that has already been recognised is
added to the carrying amount of the asset only when it is probable that future economic beneﬁts associated
with the item will ﬂow to the Group and the cost of the item can be measured reliably. All other repair and
maintenance expenses are recognised in the income statement when incurred.
(d)
Disposal
On disposal of an item of property, plant and equipment, the difference between the disposal proceeds and
its carrying amount is recognised in the income statement. Any amount in the asset revaluation reserve
relating to that asset is transferred to retained earnings directly.
(e)
Transfer
Transfers of land and building are made to/from property, plant and equipment only when there is a change
in use. For a transfer from property, plant and equipment to development properties, the deemed cost for
subsequent accounting is the fair value at the date of the change in use.
WING TAI ANNUAL REPORT 2013
46
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.7
Investment properties
Investment properties are held for long-term rental yields and/or for capital appreciation and are not occupied
substantially by the Group.
Investment properties are initially recognised at cost and subsequently carried at fair value, determined annually
by independent professional valuers. Signiﬁcant assumptions are required to determine the fair value. Changes in
fair values are recognised in the income statement.
Investment properties are subject to renovations or improvements at regular intervals. The cost of major renovations
and improvements is capitalised. The cost of maintenance, repairs and minor improvements is charged to the
income statement when incurred.
On disposal of an investment property, the difference between the disposal proceeds and the carrying amount is
recognised in the income statement.
Transfers are made to/from investment properties only when there is a change in use. For a transfer from
investment properties to development properties/property, plant and equipment, the deemed cost for subsequent
accounting is the fair value at the date of the change in use.
2.8
Development properties
(a)
Properties under development
Properties under development are stated at cost plus attributable proﬁts, less foreseeable losses and
progress payments received and receivable. An allowance is made where the estimated net realisable value
of the properties has fallen below their carrying value.
Cost includes cost of land and other direct and related expenditure, including interest on borrowings
incurred in developing the properties. Interest and other related expenditure are capitalised as and when
the activities that are necessary to get the asset ready for its intended development are in progress.
Sales of development properties under construction in respect of sale and purchase agreements entered
into prior to completion of construction are recognised when the properties are delivered to the buyers,
except for in cases where the control and risk and rewards of the property are transferred to the buyers as
construction progresses.
For sales of development properties of the Group that are within the scope as described in paragraph 2
of the Accompanying Note to INT FRS 115 - Agreements for the Construction of Real Estate, the Group
recognises revenue for sales of such development properties by reference to the stage of completion of
the properties.
The stage of completion is measured by reference to the physical surveys of construction work completed
as certiﬁed by the architects or quantity surveyors for the individual units sold. When it is probable
that the total development costs will exceed the total revenue, the expected loss is recognised as
expense immediately.
Signiﬁcant assumptions are required to estimate the total contract costs. In making this estimate,
management has relied on past experience and the work of specialists.
WING TAI ANNUAL REPORT 2013
47
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.8
Development properties (continued)
(b)
Properties held for sale
Properties held for sale are stated at the lower of cost and net realisable value. Net realisable value is the
estimated selling price in the ordinary course of business less selling expenses.
2.9
Impairment of non-ﬁnancial assets
(a)
Goodwill
Goodwill recognised separately as an intangible asset is tested for impairment annually and whenever there
is indication that the goodwill may be impaired.
For the purpose of impairment testing of goodwill, goodwill is allocated to each of the Group’s cash
generating units (“CGU”) expected to beneﬁt from synergies arising from the business combination.
An impairment loss is recognised when the carrying amount of a CGU, including the goodwill, exceeds the
recoverable amount of the CGU. The recoverable amount of a CGU is the higher of the CGU’s fair value less
cost to sell and value-in-use. The total impairment loss of a CGU is allocated ﬁrst to reduce the carrying
amount of goodwill allocated to the CGU and then to the other assets of the CGU pro-rata on the basis of
the carrying amount of each asset in the CGU.
An impairment loss on goodwill is recognised in the income statement and is not reversed in a
subsequent period.
(b)
Property, plant and equipment
Investments in subsidiary, associated and joint venture companies
Property, plant and equipment and investments in subsidiary, associated and joint venture companies
are tested for impairment whenever there is any objective evidence or indication that these assets may
be impaired.
For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to
sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash
inﬂows that are largely independent of those from other assets. If this is the case, the recoverable amount
is determined for the CGU to which the asset belongs.
If the recoverable amount of the asset (or CGU) is estimated to be less than its carrying amount, the carrying
amount of the asset (or CGU) is reduced to its recoverable amount. The difference between the carrying
amount and the recoverable amount is recognised as an impairment loss in the income statement, unless
the asset is carried at revalued amount, in which case, such impairment loss is treated as a revaluation
decrease. Please refer to Note 2.6 for the treatment of a revaluation decrease.
An impairment loss for an asset other than goodwill is reversed if, and only if, there has been a change
in the estimates used to determine the asset’s recoverable amount since the last impairment loss was
recognised. The carrying amount of this asset is increased to its revised recoverable amount, provided
that this amount does not exceed the carrying amount that would have been determined (net of any
accumulated depreciation) had no impairment loss been recognised for the asset in prior years.
WING TAI ANNUAL REPORT 2013
48
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.9
Impairment of non-ﬁnancial assets (continued)
(b)
Property, plant and equipment
Investments in subsidiary, associated and joint venture companies (continued)
A reversal of impairment loss for an asset other than goodwill is recognised in the income statement, unless
the asset is carried at revalued amount, in which case, such reversal is treated as a revaluation increase.
However, to the extent that an impairment loss on the same revalued asset was previously recognised in the
income statement, a reversal of that impairment is also recognised in the income statement.
2.10 Financial assets
(a)
Classification
The Group classiﬁes its ﬁnancial assets in the following categories: at fair value through proﬁt or loss,
loans and receivables and available-for-sale. The classiﬁcation depends on the nature of the assets and
the purpose for which the assets were acquired. Management determines the classiﬁcation of its ﬁnancial
assets at initial recognition.
(b)
(i)
Financial assets, at fair value through proﬁt or loss
Financial assets designated as at fair value through proﬁt or loss at inception are those that are
managed and their performances are evaluated on a fair value basis, in accordance with a documented
Group investment strategy. Derivatives are categorised as ﬁnancial assets at fair value through proﬁt
or loss unless they are designated as hedges. Assets in this category are presented as current assets
if they are expected to be realised within 12 months after the end of the reporting period.
(ii)
Loans and receivables
Loans and receivables are non-derivative ﬁnancial assets with ﬁxed or determinable payments that
are not quoted in an active market. They are presented as current assets, except for those expected
to be realised later than 12 months after the end of the reporting period which are presented as
non-current assets. Loans and receivables are presented as “cash and cash equivalents” and “trade
and other receivables” on the statement of ﬁnancial position and also includes deposits and sundry
receivables classiﬁed as “other current assets”.
(iii)
Available-for-sale ﬁnancial assets
Available-for-sale ﬁnancial assets are non-derivatives that are either designated in this category
or not classiﬁed in any of the other categories. They are presented as non-current assets unless
management intends to dispose of the assets within 12 months after the end of the reporting period.
Recognition and derecognition
Regular way purchases and sales of ﬁnancial assets are recognised on trade-date – the date on which the
Group commits to purchase or sell the asset.
Financial assets are derecognised when the rights to receive cash ﬂows from the ﬁnancial assets have
expired or have been transferred and the Group has transferred substantially all risks and rewards of
ownership. On disposal of a ﬁnancial asset, the difference between the carrying amount and the sale
proceeds is recognised in the income statement. Any amount in the fair value reserve relating to that asset
is transferred to the income statement.
WING TAI ANNUAL REPORT 2013
49
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.10 Financial assets (continued)
(c)
Initial measurement
Financial assets are initially recognised at fair value plus transaction costs except for ﬁnancial assets at fair
value through proﬁt or loss, which are recognised at fair value. Transaction costs for ﬁnancial assets at fair
value through proﬁt or loss are recognised immediately in the income statement.
(d)
Subsequent measurement
Financial assets, both available-for-sale and at fair value through proﬁt or loss are subsequently carried
at fair value. Loans and receivables are subsequently carried at amortised cost using the effective
interest method.
Changes in the fair values of ﬁnancial assets at fair value through proﬁt or loss including the effects
of currency translation, interest and dividends are recognised in the income statement when the
changes arise.
Interest and dividend income on available-for-sale ﬁnancial assets are recognised separately in the income
statement. Changes in the fair values of available-for-sale equity securities (i.e. non-monetary items) are
recognised in other comprehensive income, together with the related currency translation differences.
(e)
Impairment
The Group assesses at the end of each reporting period whether there is objective evidence that a ﬁnancial
asset or a group of ﬁnancial assets is impaired and recognises an allowance for impairment when such
evidence exists.
(i)
Loans and receivables
Signiﬁcant ﬁnancial difﬁculties of the debtor, probability that the debtor will enter bankruptcy,
and default or signiﬁcant delay in payments are objective evidence that these ﬁnancial assets are
impaired.
The carrying amount of these assets is reduced through the use of an impairment allowance
account which is calculated as the difference between the carrying amount and the present value
of estimated future cash ﬂows, discounted at the original effective interest rate. When the asset
becomes uncollectible, it is written off against the allowance account. Subsequent recoveries of
amounts previously written off are recognised against the same line item in the income statement.
The allowance for impairment loss account is reduced through the income statement in a subsequent
period when the amount of impairment loss decreases and the related decrease can be objectively
measured. The carrying amount of the asset previously impaired is increased to the extent that the
new carrying amount does not exceed the amortised cost had no impairment been recognised in
prior periods.
(ii)
Available-for-sale ﬁnancial assets
A signiﬁcant or prolonged decline in the fair value of an equity security below its cost is considered
as an indicator that the available-for-sale ﬁnancial asset is impaired.
WING TAI ANNUAL REPORT 2013
50
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.10 Financial assets (continued)
(e)
Impairment (continued)
(ii)
Available-for-sale ﬁnancial assets (continued)
If any evidence of impairment exists, the cumulative loss that was recognised in the fair value
reserve is transferred to the income statement. The cumulative loss is measured as the difference
between the acquisition cost (net of any principal repayments and amortisation) and the current
fair value, less any impairment loss previously recognised in the income statement. The impairment
losses recognised in the income statement on equity securities are not reversed through the
income statement.
2.11 Financial guarantees
The Company has issued corporate guarantees to banks for borrowings of its subsidiary and joint venture
companies. These guarantees are ﬁnancial guarantees as they require the Company to reimburse the banks if the
subsidiary and joint venture companies fail to make principal or interest payments when due in accordance with
the terms of their borrowings.
Financial guarantees are initially recognised at their fair values plus transaction costs in the Company’s statement
of ﬁnancial position.
Financial guarantees are subsequently amortised to the income statement over the tenure of the subsidiary
and joint venture companies’ borrowings, unless it is probable that the Company will reimburse the bank for
an amount higher than the unamortised amount. In this case, the ﬁnancial guarantees shall be carried at the
expected amount payable to the bank in the Company’s statement of ﬁnancial position.
Intra-group transactions are eliminated on consolidation.
2.12 Inventories
Inventories are carried at the lower of cost and net realisable value. Cost is determined using the weighted
average method. The cost of ﬁnished goods and work-in-progress comprises raw materials, direct labour, other
direct costs and related production overheads (based on normal operating capacity) but excludes borrowing
costs. Net realisable value is the estimated selling price in the ordinary course of business less applicable variable
selling expenses.
2.13 Borrowings and borrowing costs
Borrowings are presented as current liabilities unless the Group has an unconditional right to defer settlement for
at least 12 months after the end of the reporting period.
Borrowings are initially recognised at fair value (net of transaction costs) and subsequently carried at amortised
cost. Any difference between the proceeds (net of transaction costs) and the redemption value is recognised in
the income statement over the period of the borrowings using the effective interest method.
Borrowing costs are recognised in the income statement using the effective interest method except for those
costs that are directly attributable to borrowings acquired speciﬁcally for the construction or development of
properties. The actual borrowing costs incurred during the period up to the issuance of the temporary occupation
permit less any investment income on temporary investment of these borrowings, are capitalised in the cost of
the property under development.
WING TAI ANNUAL REPORT 2013
51
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.14 Derivative ﬁnancial instruments and hedging activities
A derivative ﬁnancial instrument is initially recognised at its fair value on the date the contract is entered into and
is subsequently carried at its fair value. The method of recognising the resulting gain or loss depends on whether
the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged.
Fair value changes on derivatives that are not designated or do not qualify for hedge accounting are recognised
in the income statement when the changes arise.
The Group documents at the inception of the transaction the relationship between the hedging instruments and
hedged items, as well as its risk management objective and strategies for undertaking various hedge transactions.
The Group also documents its assessment, both at hedge inception and on an ongoing basis, on whether the
derivatives designated as hedging instruments are highly effective in offsetting changes in cash ﬂows of the
hedged items.
The carrying amount of a derivative designated as a hedge is presented as a non-current asset or liability if
the remaining expected life of the hedged item is more than 12 months, and as a current asset or liability, if the
remaining expected life of the hedged item is less than 12 months.
The Group has entered into interest rate and cross currency swaps that are cash ﬂow hedges for the Group’s
exposure to interest rate and currency risks on its borrowings. These contracts entitle the Group to receive
interest at ﬂoating rates on notional principal amounts and oblige the Group to pay interest at ﬁxed rates on
the notional principal amounts that are denominated in the same or different currency, thus allowing the Group
to raise borrowings at ﬂoating rates and swap them into ﬁxed rates that are lower than those available if they
borrowed at ﬁxed rates directly.
The fair value changes on the effective portion of interest rate and cross currency swaps designated as cash ﬂow
hedges are recognised in other comprehensive income and transferred to the income statement when the interest
expense on the borrowings are recognised in the income statement. The fair value changes on the ineffective
portion of the interest rate and cross currency swaps are recognised immediately in the income statement.
Currency forwards are entered into to manage exposure to ﬂuctuations in foreign currency exchange rates on
highly probable forecast transactions. These contracts do not qualify for hedge accounting.
2.15 Fair value estimation of ﬁnancial assets and liabilities
The fair values of ﬁnancial instruments traded in active markets (such as exchange-traded and over-the-counter
securities and derivatives) are based on quoted market prices at the end of the reporting period. The quoted
market prices used for ﬁnancial assets are the current bid prices; the appropriate quoted market prices for
ﬁnancial liabilities are the current asking prices.
The fair values of ﬁnancial instruments that are not traded in an active market are determined by using valuation
techniques. The Group uses a variety of methods and makes assumptions that are based on market conditions
existing at the end of each reporting period. Where appropriate, quoted market prices or dealer quotes for similar
instruments are used. Valuation techniques, such as discounted cash ﬂow analyses, are also used to determine the
fair values of the ﬁnancial instruments.
WING TAI ANNUAL REPORT 2013
52
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.15 Fair value estimation of ﬁnancial assets and liabilities (continued)
The fair values of interest rate and cross currency swaps are calculated as the present value of the estimated
future cash ﬂows discounted at actively quoted interest and forward exchange rates. The fair values of currency
forwards are determined using actively quoted forward exchange rates.
The fair values of ﬁnancial liabilities carried at amortised cost are estimated by discounting the future contractual
cash ﬂows at the current market interest rates that are available to the Group for similar ﬁnancial liabilities.
The fair values of current ﬁnancial assets and liabilities carried at amortised cost approximate their
carrying amounts.
2.16 Operating leases
(a)
When the Group is the lessee:
Leases where substantially all risks and rewards incidental to ownership are retained by the lessors are
classiﬁed as operating leases. Payments made under operating leases (net of any incentives received from
the lessors) are recognised in the income statement on a straight-line basis over the period of the lease.
Contingent rents are recognised as an expense in the income statement when incurred.
(b)
When the Group is the lessor:
Leases of investment properties where the Group retains substantially all risks and rewards incidental to
ownership are classiﬁed as operating leases. Rental income from operating leases (net of any incentives
given to the lessees) is recognised in the income statement on a straight-line basis over the lease term.
2.17 Income taxes
Current income tax for current and prior periods is recognised at the amount expected to be paid to or be
recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively
enacted by the end of the reporting period.
Deferred income tax is recognised for all temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the ﬁnancial statements except when the deferred income tax arises from
the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and
affects neither accounting nor taxable proﬁt or loss at the time of the transaction.
A deferred income tax liability is recognised on temporary differences arising on investments in subsidiary,
associated and joint venture companies, except where the Group is able to control the timing of the reversal of the
temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.
A deferred income tax asset is recognised to the extent that it is probable that future taxable proﬁt will be
available against which the deductible temporary differences and tax losses can be utilised.
Deferred income tax is measured:
(a)
at the tax rates that are expected to apply when the related deferred income tax asset is realised or
the deferred income tax liability is settled, based on tax rates and tax laws that have been enacted or
substantively enacted by the end of the reporting period; and
WING TAI ANNUAL REPORT 2013
53
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.17 Income taxes (continued)
(b)
based on the tax consequence that will follow from the manner in which the Group expects, at the end
of the reporting period, to recover or settle the carrying amounts of its assets and liabilities except for
investment properties. Investment property measured at fair value is presumed to be recovered entirely
through sale.
Current and deferred income taxes are recognised as income or expense in the income statement, except to the
extent that the tax arises from a business combination or a transaction which is recognised directly in equity.
Deferred income tax arising from a business combination is adjusted against goodwill on acquisition.
2.18 Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events,
it is more likely than not that an outﬂow of resources will be required to settle the obligation and the amount has
been reliably estimated.
2.19 Trade and other payables
Trade and other payables represent liabilities for goods and services provided to the Group prior to the end of the
ﬁnancial year which are unpaid. They are classiﬁed as current liabilities if payment is due within one year or less (or
in the normal operating cycle of the business, if longer). Otherwise, they are presented as non-current liabilities.
Trade and other payables are initially recognised at fair value, and subsequently carried at amortised cost, using
the effective interest method.
2.20 Employee compensation
(a)
Defined contribution plans
Deﬁned contribution plans are post-employment beneﬁt plans under which the Group pays ﬁxed
contributions into separate entities such as the Central Provident Fund on a mandatory, contractual or
voluntary basis. The Group has no further payment obligations once the contributions have been paid.
(b)
Share-based payment
The Group operates an equity-settled, share-based payment plan. The value of the employee services
received in exchange for the grant of shares and share options is charged to the income statement with a
corresponding increase in the share-based payment reserve over the vesting period. The total amount to
be recognised over the vesting period is determined by reference to the fair value of the shares and share
options granted on the date of the grant. Non-market vesting conditions are included in the estimation
of the number of shares and share options that are expected to vest on the vesting date. At the end of
each reporting period, the Group revises its estimates of the number of shares and share options that
are expected to vest on the vesting date and recognises the impact of the revision of the estimates in
the income statement, with a corresponding adjustment to the share-based payment reserve over the
remaining vesting period.
WING TAI ANNUAL REPORT 2013
54
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.21 Currency translation
(a)
Functional and presentation currency
Items included in the ﬁnancial statements of each entity in the Group are measured using the currency
of the primary economic environment in which the entity operates (“functional currency”). The ﬁnancial
statements are presented in Singapore Dollars, which is the functional currency of the Company.
(b)
Transactions and balances
Transactions in a currency other than the functional currency (“foreign currency”) are translated into
the functional currency using the exchange rates at the dates of the transactions. Currency translation
differences resulting from the settlement of such transactions and from the translation of monetary assets
and liabilities denominated in foreign currencies at the closing rates at the end of the reporting period are
recognised in the income statement, unless they arise from borrowings in foreign currencies qualifying
as net investment in foreign operations. Those currency translation differences are recognised in other
comprehensive income in the consolidated ﬁnancial statements and transferred to the income statement
as part of the gain or loss on disposal of the foreign operation.
Non-monetary items measured at fair values in foreign currencies are translated using the exchange rates
at the date when the fair values are determined.
(c)
Translation of Group entities’ financial statements
The results and ﬁnancial position of all the Group entities that have a functional currency different from the
presentation currency are translated into the presentation currency as follows:
(i)
Assets and liabilities are translated at the closing exchange rates at the end of the reporting period;
(ii)
Income and expenses are translated at average exchange rates (unless the average is not a reasonable
approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case
income and expenses are translated using the exchange rates at the dates of the transactions); and
(iii)
All resulting currency translation differences are recognised in other comprehensive income.
Goodwill and fair value adjustments arising on the acquisition of foreign operations are treated as assets
and liabilities of the foreign operations and translated at the closing rates at the end of the reporting period.
WING TAI ANNUAL REPORT 2013
55
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
2.22 Segment reporting
Operating segments are reported in a manner consistent with the Group’s principal activities and internal reporting
provided to management who are responsible for allocating resources and assessing the performance of the
operating segments.
Sales between segments are carried out at arm’s length. The revenue from external parties reported to management
is measured in a manner consistent with that in the income statement.
Management assesses the performance of the operating segments based on a measure of Earnings before interest
and tax (“EBIT”). Interest income and ﬁnance costs are not allocated to the segments.
The amounts provided to management with respect to total assets and liabilities are measured in a manner
consistent with that of the ﬁnancial statements. These assets and liabilities are allocated based on the operations
of the segment. All assets and liabilities are allocated to reportable segments other than tax recoverable and
current and deferred income tax.
Segment capital expenditure is the total cost incurred during the ﬁnancial year to acquire property, plant and
equipment and investment properties.
2.23 Cash and cash equivalents
For the purpose of presentation in the consolidated statement of cash ﬂows, cash and cash equivalents include
interest-bearing bank accounts, ﬁxed deposits with ﬁnancial institutions and cash and bank balances, which are
subject to an insigniﬁcant risk of change in value.
2.24 Share capital and treasury shares
Ordinary shares are classiﬁed as equity. Incremental costs directly attributable to the issuance of new ordinary
shares are deducted against the share capital account.
When any entity within the Group purchases the Company’s ordinary shares (“treasury shares”), the consideration
paid including any directly attributable incremental cost is presented as a component within equity attributable
to the Company’s equity holders, until they are cancelled, sold or reissued.
When treasury shares are subsequently cancelled, the cost of treasury shares are deducted against the share
capital account if the shares are purchased out of capital of the Company, or against the retained earnings of the
Company if the shares are purchased out of earnings of the Company.
When treasury shares are subsequently sold or reissued pursuant to the employee share plans and share option
scheme, the cost of the treasury shares is reversed from the treasury shares reserve.
2.25 Dividends to equity holders of the Company
Dividends to equity holders of the Company are recognised when the dividends are approved for payment.
WING TAI ANNUAL REPORT 2013
56
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
3.
REVENUE
Group
Revenue from sale of:
— development properties
— goods
Rental income
Management fees
Dividend income
4.
2013
$’000
2012
$’000
1,077,589
212,852
37,452
4,503
104
363,919
219,126
37,891
3,861
91
1,332,500
624,888
OTHER GAINS — NET
Group
Interest income from:
— joint venture companies
— banks
Gain on disposal of property, plant and equipment
Loss on disposal of investment property
Gain on liquidation of an available-for-sale ﬁnancial asset
Fair value gains on investment properties
Loss on defaulted sales of development properties
Dilution loss on interest in an associated company
Other miscellaneous gains
WING TAI ANNUAL REPORT 2013
2013
$’000
2012
$’000
7,981
3,037
204
—
5,696
52,112
—
(2,830)
5,326
5,140
2,918
1,489
(172)
—
15,713
(6,540)
(2,613)
2,558
71,526
18,493
57
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
5.
EXPENSES BY NATURE
Group
Depreciation of property, plant and equipment
Employee compensation
Auditors’ remuneration paid/payable to:
— auditor of the Company
— other auditors
Other fees paid/payable to:
— auditor of the Company
— other auditors
Fair value losses/(gains) on derivative ﬁnancial instruments
Allowance for stock obsolescence
Write-off of property, plant and equipment
Impairment loss on property, plant and equipment
Rental expense on operating leases
Foreign exchange loss/(gain)
Development cost included in cost of sales
Raw materials and ﬁnished goods included in cost of sales
2013
$’000
2012
$’000
12,489
85,487
11,938
74,101
331
240
325
210
117
281
112
2,044
674
251
51,938
3,088
613,409
83,721
20
230
(368)
1,188
442
—
52,017
(12,506)
196,510
81,497
Included in the Group’s rental expense on operating leases is contingent rent amounting to $2.4 million
(2012: $3.2 million).
6.
EMPLOYEE COMPENSATION
Group
Wages and salaries (including directors’ remuneration)
Employer’s contribution to deﬁned contribution plans
including Central Provident Fund
Share-based payment
2013
$’000
2012
$’000
75,735
63,962
6,980
2,772
6,942
3,197
85,487
74,101
Please refer to Note 33(b) for directors’ remuneration.
WING TAI ANNUAL REPORT 2013
58
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
7.
FINANCE COSTS
Group
Interest expense to banks
8.
2013
$’000
2012
$’000
39,383
37,161
INCOME TAXES
(a)
Income tax expense
Group
2013
$’000
2012
(restated)
$’000
Tax expense/(credit) attributable to proﬁt is made up of:
Current income tax
— Singapore
— Foreign
27,819
43,406
47,485
7,441
Deferred income tax
71,225
33,740
54,926
(21,297)
104,965
33,629
(Over)/under provision in preceding ﬁnancial years
— Current income tax
— Deferred income tax
(1,418)
(621)
102,926
2,726
(2,668)
33,687
The Group is subject to income taxes in numerous jurisdictions. Signiﬁcant judgement is required in
estimating the capital allowances and the deductibility of certain expenses in determining the provision
for income taxes. There are many transactions and calculations during the ordinary course of business for
which the ultimate tax determination is uncertain. The Group recognises liabilities for anticipated tax audit
issues based on estimates of whether additional taxes will be due. Where the ﬁnal tax outcome of these
matters is different from the amounts that were initially recorded, such differences will impact the current
and deferred income tax provisions in the period in which such determination is made.
WING TAI ANNUAL REPORT 2013
59
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
8.
INCOME TAXES (continued)
(a)
Income tax expense (continued)
The income tax expense on proﬁt before tax and share of proﬁts of associated and joint venture
companies differs from the amount that would arise using the Singapore standard rate of income tax as
explained below:
Group
2013
%
Singapore standard rate of income tax
Different tax rates in other countries
Expenses not deductible for tax purposes
Income not subject to tax
Tax losses not recognised
2012
(restated)
%
17.0
2.9
5.2
(1.2)
2.6
17.0
1.1
8.5
(5.0)
4.6
26.5
26.2
The tax charge relating to each component of other comprehensive income/(expense) is as follows:
2013
Cash ﬂow hedges
Currency translation differences
Share of other comprehensive income of
associated and joint venture companies
Revaluation gains on property, plant and equipment
Share of revaluation gains on property, plant and
equipment of an associated company
Before tax
$’000
Group
Tax charge
$’000
After tax
$’000
8,864
10,716
—
—
8,864
10,716
8,230
75,094
2,138
105,042
2012 (restated)
Cash ﬂow hedges
Currency translation differences
Share of other comprehensive expense of
associated and joint venture companies
Revaluation gains on property, plant and equipment
Share of revaluation gains on property, plant and
equipment of an associated company
13,668
3,350
(5,124)
10,964
695
23,553
—
(11,732)
—
(11,732)
—
—
—
(1,475)
—
(1,475)
8,230
63,362
2,138
93,310
13,668
3,350
(5,124)
9,489
695
22,078
WING TAI ANNUAL REPORT 2013
60
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
8.
INCOME TAXES (continued)
(b)
Deferred income taxes
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current
income tax assets against current income tax liabilities and when the deferred income taxes relate to the
same ﬁscal authority. The amounts, determined after appropriate offsetting, are shown on the statement
of ﬁnancial position as follows:
Group
2012
(restated)
$’000
2013
$’000
Deferred income tax liabilities to be settled after one year
62,267
17,137
2011
(restated)
$’000
39,818
Deferred income tax assets are recognised for tax losses carried forward to the extent that realisation of
the related tax beneﬁts through future taxable proﬁts is probable. The Group had unrecognised tax losses
of $153.3 million (2012: $175.6 million) at the end of the reporting period which can be carried forward and
used to offset against future taxable income subject to meeting certain statutory requirements by those
companies with unutilised tax losses in their respective countries of incorporation. These tax losses have
no expiry date.
The movement in deferred income tax assets and liabilities (prior to offsetting of balances within the same
tax jurisdiction) during the ﬁnancial year is as follows:
Deferred income tax liabilities — Group
Accelerated
tax
depreciation
$’000
5,079
2013
Beginning of ﬁnancial year
Effect of adopting Amendments
to FRS 12
—
Revaluation
gains
$’000
Recognition
of profits on
percentage
of completion
$’000
Others
$’000
Total
$’000
56,782
6,320
227
68,408
—
—
(49,252)
(49,252)
As restated
Currency translation differences
Charged/(credited) to:
— other comprehensive income
— income statement
5,079
(3)
7,530
160
6,320
—
227
124
19,156
281
—
(545)
11,732
7,940
—
21,317
—
2,823
11,732
31,535
End of financial year
4,531
27,362
27,637
3,174
62,704
WING TAI ANNUAL REPORT 2013
61
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
8.
INCOME TAXES (continued)
(b)
Deferred income taxes (continued)
Deferred income tax liabilities — Group (continued)
Accelerated
tax
depreciation
$’000
6,331
2012 (restated)
Beginning of ﬁnancial year
Effect of adopting Amendments
to FRS 12
—
Revaluation
gains
$’000
Recognition
of profits on
percentage
of completion
$’000
Others
$’000
Total
$’000
51,846
27,746
156
86,079
(45,847)
—
—
(45,847)
156
—
40,232
(226)
—
71
1,475
(22,325)
As restated
Currency translation differences
Charged/(credited) to:
— other comprehensive income
— income statement
6,331
(13)
5,999
(213)
27,746
—
—
(1,239)
1,475
269
—
(21,426)
End of ﬁnancial year
5,079
7,530
6,320
227
19,156
Provisions
$’000
Tax losses
$’000
Others
$’000
Total
$’000
Deferred income tax assets — Group
2013
Beginning of ﬁnancial year
Currency translation differences
Charged to income statement
19
—
—
395
(2)
(65)
End of financial year
19
328
2012
Beginning of ﬁnancial year
Currency translation differences
Credited to income statement
19
—
—
331
(6)
70
64
(29)
1,570
414
(35)
1,640
End of ﬁnancial year
19
395
1,605
2,019
1,605
4
(1,519)
90
2,019
2
(1,584)
437
WING TAI ANNUAL REPORT 2013
62
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
9.
EARNINGS PER SHARE
(a)
Basic earnings per share
Basic earnings per share is calculated by dividing the net proﬁt attributable to equity holders of the
Company by the weighted average number of ordinary shares in issue during the ﬁnancial year.
Group
2013
$’000
Net proﬁt before fair value gains on investment properties
attributable to equity holders of the Company
293,705
151,847
Fair value gains on investment properties
237,421
110,519
Net proﬁt after fair value gains on investment properties
attributable to equity holders of the Company
531,126
262,366
’000
’000
783,216
780,803
37.50
67.81
19.45
33.60
Weighted average number of ordinary shares
in issue for basic earnings per share
Basic earnings per share (cents) based on:
Proﬁt before fair value gains on investment properties
Proﬁt after fair value gains on investment properties
(b)
2012
(restated)
$’000
Diluted earnings per share
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares in
issue to assume issuance of all dilutive potential ordinary shares from share plans and share options.
WING TAI ANNUAL REPORT 2013
63
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
9.
EARNINGS PER SHARE (continued)
(b)
Diluted earnings per share (continued)
Group
2013
$’000
Net proﬁt before fair value gains on investment properties
attributable to equity holders of the Company
Adjustments for share options and share plans of:
— a subsidiary company
— an associated company
Net proﬁt before fair value gains on investment properties
used to determine diluted earnings per share
Net proﬁt after fair value gains on investment properties
attributable to equity holders of the Company
Adjustments for share options and share plans of:
— a subsidiary company
— an associated company
Net proﬁt after fair value gains on investment properties
used to determine diluted earnings per share
Weighted average number of ordinary shares
in issue for basic earnings per share
Adjustments for:
— share plans
— share options
Number of ordinary shares used to determine
diluted earnings per share
Diluted earnings per share (cents) based on:
Proﬁt before fair value gains on investment properties
Proﬁt after fair value gains on investment properties
293,705
(152)
(304)
2012
(restated)
$’000
151,847
(25)
(150)
293,249
151,672
531,126
262,366
(152)
(1,151)
(20)
(597)
529,823
261,749
’000
’000
783,216
780,803
4,014
356
3,750
79
787,586
784,632
37.23
67.27
19.33
33.36
WING TAI ANNUAL REPORT 2013
64
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
10.
CASH AND CASH EQUIVALENTS
Group
Fixed deposits with ﬁnancial institutions
Cash and bank balances
Company
2013
$’000
2012
$’000
2013
$’000
2012
$’000
622,368
402,173
694,293
154,393
317,700
288,580
402,350
39,310
1,024,541
848,686
606,280
441,660
Included in cash and cash equivalents of the Group are amounts held under Housing Developers (Project Account)
(Amendment) Rules 1997, totalling $175.6 million (2012: $65.0 million), the use of which is subject to restrictions
imposed by the aforementioned rules.
The carrying amounts of cash and cash equivalents approximated their fair values.
11.
DERIVATIVE FINANCIAL INSTRUMENTS
Contract
notional
amount
$’000
2013
Cash ﬂow hedges
— Interest rate and cross currency swaps
Non-hedging instruments
— Currency forwards
Group
Fair value
(liability)/
asset
$’000
Company
Contract
notional
Fair value
amount
liability
$’000
$’000
275,563
(11,744)
25,000
11,603
(42)
—
(11,786)
2012
Cash ﬂow hedges
— Interest rate and cross currency swaps
Non-hedging instruments
— Currency forwards
375,703
10,369
(20,738)
69
(20,669)
(257)
—
(257)
125,000
—
(3,503)
—
(3,503)
As at 30 June 2013, the ﬁxed interest rate on HKD interest rate swap is 5.5% (2012: 5.5%) per annum, the ﬁxed
interest rate on USD interest rate swap is 2.8% (2012: 2.8%) per annum and the ﬁxed interest rates on SGD interest
rate swaps vary from 2.5% to 3.0% (2012: 2.5% to 5.5%) per annum. The main ﬂoating rates are Hong Kong
Interbank Offered Rate, London Interbank Offered Rate and Singapore Swap Offered Rate.
Interest rate swaps are entered into to hedge ﬂoating rate borrowings that will mature between September 2013
to October 2014. Fair value gains and losses on the interest rate swaps recognised in the cash ﬂow hedge reserve
are reclassiﬁed to the income statement as part of ﬁnance costs or capitalised in the costs of the properties under
development over the period of the borrowings.
Please refer to Note 2.14 for details of the ﬁnancial instruments and hedging policies.
WING TAI ANNUAL REPORT 2013
65
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
12.
TRADE AND OTHER RECEIVABLES — CURRENT
Group
Trade receivables
Allowance for impairment of receivables
Due from subsidiary companies
— non-trade [Note 12(i)]
Allowance for impairment of receivables
Due from associated and joint venture companies
— non-trade [Note 12(ii)]
Due from non-controlling interests
— non-trade [Note 12(iii)]
Total current receivables
Company
2013
$’000
2012
$’000
2013
$’000
2012
$’000
105,100
(202)
57,033
(245)
—
—
—
—
104,898
56,788
—
—
—
—
—
—
491,353
(191,222)
—
—
300,131
436,539
61,261
24,491
316
360
—
2,125
—
—
166,159
83,404
300,447
436,899
621,718
(185,179)
(i)
Amounts due from subsidiary companies are unsecured and repayable on demand. Included in the amounts
due from subsidiary companies are ﬁxed-interest loan receivables of $240.8 million (2012: $236.8 million).
(ii)
Amounts due from associated and joint venture companies are unsecured and repayable on demand.
Included in the amounts due from associated and joint venture companies are ﬁxed-interest loan receivables
of $54.9 million (2012: $17.4 million).
(iii)
Amounts due from non-controlling interests are unsecured, interest free and repayable on demand.
The carrying amounts of current trade and other receivables approximated their fair values.
WING TAI ANNUAL REPORT 2013
66
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
13.
INVENTORIES
Group
Raw materials
Work-in-progress
Finished goods
2013
$’000
2012
$’000
365
126
21,305
471
73
20,227
21,796
20,771
The cost of inventories recognised as expense and included in “cost of sales” amounted to $83.7 million
(2012: $81.5 million).
14.
DEVELOPMENT PROPERTIES
Group
Properties under development
— Land, at cost
— Development costs
— Overhead expenditure capitalised
— Attributable proﬁts
— Allowance for foreseeable losses
— Progress payments received and receivable
Properties held for sale
Value of properties under development mortgaged to
secure long term banking facilities granted (Note 24)
Total interest capitalised during the ﬁnancial year
WING TAI ANNUAL REPORT 2013
2013
$’000
2012
$’000
1,022,999
676,070
89,230
712,791
452,907
73,064
1,788,299
377,363
(76,577)
1,238,762
41,841
(76,973)
2,089,085
(786,554)
1,203,630
(323,641)
1,302,531
160,542
879,989
213,150
1,463,073
1,093,139
780,960
737,917
8,958
9,173
67
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
14.
DEVELOPMENT PROPERTIES (continued)
The major development properties are as follows:
Location
Type of
development
Tenure
% of
completion
at
30.06.2013
Expected
completion
date
Land
area
(Sq m)
Gross
Group’s
floor interest in
area property
(Sq m)
(%)
Singapore
Helios Residences 140 units of
at Cairnhill Circle apartments
Freehold
100
n/a
7,399
20,717
100
Belle Vue
Residences
at Oxley Walk
176 units of
condominium
housing
Freehold
100
n/a
23,004
32,205
60
L’VIV
at Newton Road
147 units of
apartments
Freehold
88
2013
3,984
11,156
100
Le Nouvel
Ardmore at
Ardmore Park
43 units of
condominium
housing
Freehold
51
2014
5,624
15,746
100
Foresque
Residences
at Petir Road
496 units of
condominium
housing
Leasehold
75
2014
22,744
47,763
100
The Tembusu at
Tampines Road
337 units of
condominium
housing and
1 unit of shop
Freehold
—
2016
13,149
27,614
100
Sering Ukay
at Mukim of Ulu
Klang, Gombak,
Selangor
152 units
of semidetached
houses and
bungalows
Freehold Phase 3
—
—
188,151
52,955
60.9
Verticas
Residences at
Section 57, Town
of Kuala Lumpur
423
units of
condominium
housing
Freehold Towers A,
B, C, D
100
n/a
9,764
29,373
60.9
Kondominium
Le Nouvel at
Section 43,
Town of
Kuala Lumpur
197 units of
condominium
housing
Freehold
22
2015
6,084
50,033
60.9
Malaysia
WING TAI ANNUAL REPORT 2013
68
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
14.
DEVELOPMENT PROPERTIES (continued)
Location
Type of
development
Tenure
% of
completion
at
30.06.2013
Expected
completion
date
Land
area
(Sq m)
Gross
Group’s
floor interest in
area property
(Sq m)
(%)
65
2014
4,047
15,078
60.9
100
n/a
463
775
60.9
—
—
27,863
50,026
60.9
Malaysia (continued)
Kondominium
Nobleton Crest
at Section 89,
Town of
Kuala Lumpur
25 units of
condominium
housing
Freehold
Taman Seri
34 units of
Impian at Mukim shop ofﬁces
14 and 15,
Daerah Seberang
Perai Tengah,
Pulau Pinang
Freehold Phase 6
Taman Nagasari
423 units of
at Mukim 6,
ﬂats and
Province
vacant land
Wellesley Central,
Pulau Pinang
Freehold Blocks A & B
Taman Bukit
Minyak Utama
at Mukim 14,
Daerah Seberang
Perai Tengah,
Pulau Pinang
595 units
of terrace
and semidetached
houses
and shop
houses
Freehold Phase 1
Phase 2
Phase 3
Phase 4
100
100
100
21
n/a
n/a
n/a
2015
64,223
33,109
60.9
Sentral Greens at
Mukim 13, Tempat
Relau, Daerah
Timur Laut,
Pulau Pinang
54 units
of terrace
and semidetached
houses
Freehold
100
n/a
1,425
260
60.9
Impiana
Boulevard
and Impiana
Gallery at
Mukim 14,
Daerah Seberang
Perai Tengah,
Pulau Pinang
81 units of
shop houses
and vacant
land
Freehold
100
n/a
10,015
14,786
60.9
WING TAI ANNUAL REPORT 2013
69
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
14.
DEVELOPMENT PROPERTIES (continued)
Location
Type of
development
Tenure
% of
completion
at
30.06.2013
Gross
Group’s
floor interest in
area property
(Sq m)
(%)
Expected
completion
date
Land
area
(Sq m)
85
—
2013
—
468,671
34,129
60.9
Malaysia (continued)
Jesselton Hills
at Mukim 15,
Daerah Seberang
Perai Tengah,
Pulau Pinang
810 units of
Freehold Phase 1
terrace and
Phase 2-5
semi-detached
houses and
vacant land
Vacant land
at Pekan
Penaga, District
of Petaling,
Selangor
—
99-year
lease
expiring
2093
—
—
38,155
n/a
60.9
Vacant land at
Section 89A,
Town of
Kuala Lumpur
—
Freehold
—
—
8,645
n/a
60.9
Vacant land
—
at Mukim 14-16,
Daerah Seberang
Perai Tengah,
Pulau Pinang
Freehold
—
—
376,466
n/a
60.9
Vacant land at
Mukim 17,
Batu Ferringhi,
Pulau Pinang
Freehold
—
—
2,282
n/a
60.9
—
The People’s Republic of China
The Lakeview at
No.63 Xinggang
Street, Suzhou
Industrial Park
190 units of
apartments
70-year
lease
expiring
2066
Phase 3
100
n/a
9,740
32,140
75
The Lakeside
at No.1 Xingzhou
Street, Suzhou
Industrial Park
60 units of
apartments
70-year
lease
expiring
2066
Phase 2
—
—
19,518
18,990
75
—
—
53,838
n/a
100
Vacant land at
—
F1-3 Luodian New
Town, Shanghai
Baoshan District
70-year
lease
expiring
2083
n/a: not applicable
WING TAI ANNUAL REPORT 2013
70
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
15.
OTHER CURRENT ASSETS
Group
Deposits
Prepayments
Sundry receivables
Company
2013
$’000
2012
$’000
2013
$’000
2012
$’000
11,245
43,612
4,668
12,079
60,970
2,063
190
3,333
1,079
71
2,043
2,348
59,525
75,112
4,602
4,462
The carrying amounts of deposits and sundry receivables approximated their fair values.
16.
AVAILABLE-FOR-SALE FINANCIAL ASSETS
Group
2013
$’000
Beginning of ﬁnancial year
Liquidation
End of ﬁnancial year
Company
2012
$’000
2013
$’000
2012
$’000
7,170
(3,981)
7,170
—
3,189
—
3,189
—
3,189
7,170
3,189
3,189
The available-for-sale ﬁnancial assets comprised unquoted equity shares in Singapore.
WING TAI ANNUAL REPORT 2013
71
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
17.
TRADE AND OTHER RECEIVABLES — NON-CURRENT
Group
Loans to subsidiary companies [Note 17(i)]
Allowance for impairment of receivables
Loans to joint venture companies [Note 17(ii)]
Allowance for impairment of receivables
Loans to non-controlling interests [Note 17(iii)]
Total non-current receivables
(i)
Company
2013
$’000
2012
$’000
2013
$’000
2012
$’000
—
—
—
—
676,184
(14,379)
467,037
(14,472)
—
—
661,805
452,565
282,577
(189)
198,770
(190)
—
—
—
—
282,388
198,580
—
—
9,985
6,881
—
—
292,373
205,461
661,805
452,565
Loans to subsidiary companies are unsecured, have no ﬁxed terms of repayment and are not expected to
be repayable within the next 12 months. Included in the loans to subsidiary companies are ﬁxed-interest
loan receivables of $312.7 million (2012: $202.5 million) and ﬂoating-interest loan receivables of $12.4 million
(2012: $12.4 million).
The interest-free loans to subsidiary companies are intended to be a long-term source of additional capital
for the subsidiary companies. As a result, management considers such loans to be in substance part of the
Company’s net investment in these subsidiary companies and has accounted for these loans in accordance
with Note 2.5.
(ii)
Loans to joint venture companies are unsecured, have no ﬁxed terms of repayment and are not expected to
be repayable within the next 12 months. Included in the loans to joint venture companies are ﬁxed-interest
loan receivables of $282.4 million (2012: $198.6 million).
The interest-bearing loans to joint venture companies amounting to $282.4 million (2012: $183.1 million) are
subordinated to banking facilities of $967.8 million (2012: $893.8 million) granted by banks to the said joint
venture companies.
(iii)
Loans by certain subsidiary companies to non-controlling interests are made proportionate to the
shareholders’ equity stake in the subsidiary companies on a pari passu basis. The loans are unsecured,
interest-free, have no ﬁxed terms of repayment and are not expected to be repayable within the next
12 months.
The carrying amounts of non-current trade and other receivables approximated their fair values.
WING TAI ANNUAL REPORT 2013
72
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
18.
INVESTMENT IN AN ASSOCIATED COMPANY
2013
$’000
Carrying amount of quoted investment in an associated company
The above carrying amount included the following:
— Share of an associated company’s other comprehensive
income/(expense) for the year
— Share of an associated company’s net proﬁt for the year
1,043,593
48,140
263,413
Group
2012
(restated)
$’000
2011
(restated)
$’000
736,367
602,498
(4,854)
124,312
7,326
111,125
The summarised ﬁnancial information of an associated company, not adjusted for the proportionate ownership
interest held by the Group, is as follows:
Group
2013
2012
2011
(restated)
(restated)
$’000
$’000
$’000
Assets
Liabilities
Revenue
Net proﬁt
Share of an associated company’s contingent liabilities and
ﬁnancial guarantees incurred jointly with other investors
Market value of quoted equity shares
4,265,639
(1,248,499)
497,840
765,104
3,646,401
(1,107,980)
402,635
387,455
3,093,111
(978,703)
263,850
400,750
6,403
—
—
371,575
308,870
231,200
As at 30 June 2013, the carrying value of quoted equity shares is higher than the market value. The directors
consider the carrying value of investment in the associated company appropriate, after having evaluated various
qualitative and quantitative factors including the historical ﬁnancial performance of the associated company.
Details of the Group’s associated company are listed in Note 35 to the ﬁnancial statements.
WING TAI ANNUAL REPORT 2013
73
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
19.
INVESTMENTS IN JOINT VENTURE COMPANIES
The following amounts represent the Group’s share of the assets, liabilities, revenue and expenses of the joint
venture companies which are included in the consolidated statement of ﬁnancial position and consolidated
statement of comprehensive income using equity accounting.
Group
Assets
— Current assets
— Non-current assets
Liabilities
— Current liabilities
— Non-current liabilities
2013
$’000
2012
$’000
902,754
140,388
755,864
34,602
1,043,142
790,466
(280,465)
(555,378)
(182,124)
(446,910)
(835,843)
(629,034)
Net assets
207,299
161,432
Revenue
Expenses
Income tax expense
253,646
(215,014)
(7,292)
328,262
(250,265)
(12,834)
Net proﬁt
31,340
65,163
The Group’s share of the capital commitments of the joint venture companies were as follows:
Group
Contracted but not provided for
2013
$’000
2012
$’000
81,606
48,714
Details of the Group’s joint venture companies are listed in Note 35 to the ﬁnancial statements.
WING TAI ANNUAL REPORT 2013
74
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
20. INVESTMENTS IN SUBSIDIARY COMPANIES
Company
Beginning and end of ﬁnancial year
2013
$’000
2012
$’000
252,392
252,392
Details of the Group’s subsidiary companies are listed in Note 35 to the ﬁnancial statements.
21.
INVESTMENT PROPERTIES
Group
Beginning of ﬁnancial year
Fair value gains recognised in income statement
Transfer to property, plant and equipment
Transfer (to)/from development properties
Additional expenditure
Disposals
Currency translation differences
End of ﬁnancial year
2013
$’000
2012
$’000
578,085
52,112
(2,285)
(66,485)
612
—
114
560,210
15,713
—
2,795
—
(774)
141
562,153
578,085
Lettable
area
(Sq m)
Group’s
interest in
property
(%)
The major investment properties are as follows:
Location
Description
Tenure
Singapore
Winsland House I
at 3 Killiney Road
(1st to 9th ﬂoor)
10-storey
commercial building
99-year lease
expiring 2082
13,165
100
Winsland House II
at 163 Penang Road
8-storey
commercial building
99-year lease
expiring 2093
7,287
100
Conservation
house
99-year lease
expiring 2093
534
100
9-storey
serviced apartments
99-year lease
expiring 2093
6,030
100
Winsland House II
at 165 Penang Road
Lanson Place
Winsland Serviced
Residences at 167
Penang Road
WING TAI ANNUAL REPORT 2013
75
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
21.
INVESTMENT PROPERTIES (continued)
Lettable
area
(Sq m)
Group’s
interest in
property
(%)
Location
Description
Tenure
Malaysia
Lanson Place
Kondominium No. 8
at Section 89A,
Town of Kuala Lumpur
132 units of
condominium
housing
Freehold
22,702
60.9
Sering Ukay at Jalan SU1E,
Ampang, Selangor
10 units of
shop ofﬁces
Freehold
2,872
60.9
Taman Bukit Minyak Utama at
Lorong Bukit Minyak Utama 2,
Pulau Pinang
7 units of
shop ofﬁces
Freehold
2,776
60.9
8-storey
commercial building
50-year lease
expiring 2046
8,255
75
The People’s Republic of China
Singa Plaza
at No. 8 Jinji Hu Road,
Suzhou Industrial Park
Investment properties are carried at fair values at the end of the reporting period as determined by independent
professional valuers based on the Direct Market Comparison Method and Investment Method.
Investment properties are leased to third parties under operating leases (Note 30).
Investment properties with a total valuation of $535.5 million (2012: $516.1 million) were mortgaged to banks to
secure long term banking facilities granted to the subsidiary companies (Note 24).
The following amounts are recognised in the income statement:
Group
Rental income
Direct operating expenses arising from investment properties
that generated rental income
2013
$’000
2012
$’000
31,694
31,962
(10,759)
(10,801)
WING TAI ANNUAL REPORT 2013
76
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
22.
PROPERTY, PLANT AND EQUIPMENT
GROUP
2013
Cost or valuation
Beginning of ﬁnancial year
Cost
Valuation
Additions
Disposals
Write-off
Revaluation gains
Transfer to development properties
Transfer from investment properties
Currency translation differences
Freehold
land and
buildings
$’000
Leasehold
land and
buildings
$’000
Motor
vehicles
$’000
—
111,442
—
57,082
6,058
—
19,709
—
46,914
—
72,681
168,524
57,082
299
—
—
2,788
—
2,285
(78)
6,058
516
(277)
—
—
—
—
(20)
19,709
2,991
(58)
(1,407)
—
—
—
(71)
46,914
16,077
(2)
(6,772)
—
—
—
(163)
241,205
19,883
(337)
(8,179)
74,488
(148,700)
2,285
(598)
111,442
—
—
—
71,700
(148,700)
—
(266)
Office
Furniture
equipment and fittings
$’000
$’000
Total
$’000
End of ﬁnancial year
34,176
62,376
6,277
21,164
56,054
180,047
Representing:
Cost
Valuation
—
34,176
—
62,376
6,277
—
21,164
—
56,054
—
83,495
96,552
34,176
62,376
6,277
21,164
56,054
180,047
Accumulated depreciation and impairment losses
Beginning of ﬁnancial year
402
Depreciation charge
314
Disposals
—
Write-off
—
Impairment loss
—
Revaluation adjustments
(103)
Currency translation differences
(6)
523
1,151
—
—
—
(503)
(8)
3,543
839
(236)
—
—
—
(13)
9,460
2,110
(56)
(1,361)
37
—
(65)
30,303
8,075
(2)
(6,144)
214
—
(120)
End of ﬁnancial year
607
1,163
4,133
10,125
32,326
48,354
Net book value
End of financial year
33,569
61,213
2,144
11,039
23,728
131,693
WING TAI ANNUAL REPORT 2013
44,231
12,489
(294)
(7,505)
251
(606)
(212)
77
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
22.
PROPERTY, PLANT AND EQUIPMENT (continued)
Freehold
land and
buildings
$’000
Leasehold
land and
buildings
$’000
Motor
vehicles
$’000
GROUP
2012
Cost or valuation
Beginning of ﬁnancial year
Cost
Valuation
—
104,076
—
57,029
5,348
—
17,724
—
45,972
—
69,044
161,105
Additions
Disposals
Write-off
Revaluation gains
Currency translation differences
104,076
—
(1,247)
—
9,150
(537)
57,029
432
(581)
—
361
(159)
5,348
776
(27)
—
—
(39)
17,724
2,997
(276)
(545)
—
(191)
45,972
5,060
(31)
(3,724)
—
(363)
230,149
9,265
(2,162)
(4,269)
9,511
(1,289)
End of ﬁnancial year
111,442
57,082
6,058
19,709
46,914
241,205
Representing:
Cost
Valuation
—
111,442
—
57,082
6,058
—
19,709
—
46,914
—
72,681
168,524
111,442
57,082
6,058
19,709
46,914
241,205
27,061
6,885
(24)
(3,345)
—
(274)
38,505
11,938
(441)
(3,827)
(1,453)
(491)
Accumulated depreciation and impairment losses
Beginning of ﬁnancial year
450
Depreciation charge
621
Disposals
(140)
Write-off
—
Revaluation adjustments
(525)
Currency translation differences
(4)
Office
Furniture
equipment and fittings
$’000
$’000
312
1,155
(8)
—
(928)
(8)
2,504
1,068
—
—
—
(29)
8,178
2,209
(269)
(482)
—
(176)
Total
$’000
End of ﬁnancial year
402
523
3,543
9,460
30,303
44,231
Net book value
End of ﬁnancial year
111,040
56,559
2,515
10,249
16,611
196,974
WING TAI ANNUAL REPORT 2013
78
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
22.
PROPERTY, PLANT AND EQUIPMENT (continued)
Motor
vehicles
$’000
COMPANY
2013
Beginning of ﬁnancial year
Cost
2,122
Additions
Disposals
Write-off
—
(108)
—
Office
Furniture
equipment and fittings
$’000
$’000
6,878
565
(24)
(130)
2,101
11,101
564
—
(317)
1,129
(132)
(447)
End of ﬁnancial year
2,014
Accumulated depreciation
Beginning of ﬁnancial year
Depreciation charge
Disposals
Write-off
1,439
264
(81)
—
760
231
(24)
(119)
1,074
257
—
(170)
3,273
752
(105)
(289)
End of ﬁnancial year
1,622
848
1,161
3,631
Net book value
End of financial year
392
6,441
1,187
8,020
WING TAI ANNUAL REPORT 2013
7,289
Total
$’000
2,348
11,651
79
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
22.
PROPERTY, PLANT AND EQUIPMENT (continued)
Motor
vehicles
$’000
COMPANY
2012
Beginning of ﬁnancial year
Cost
Additions
Disposals
Write-off
2,122
—
—
—
End of ﬁnancial year
2,122
Accumulated depreciation
Beginning of ﬁnancial year
Depreciation charge
Disposals
Write-off
1,014
425
—
—
End of ﬁnancial year
Net book value
End of ﬁnancial year
Office
Furniture
equipment and fittings
$’000
$’000
5,418
1,558
(94)
(4)
6,878
2,072
29
—
—
Total
$’000
9,612
1,587
(94)
(4)
2,101
11,101
774
84
(94)
(4)
873
201
—
—
2,661
710
(94)
(4)
1,439
760
1,074
3,273
683
6,118
1,027
7,828
WING TAI ANNUAL REPORT 2013
80
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
22.
PROPERTY, PLANT AND EQUIPMENT (continued)
The freehold and leasehold land and buildings of the Group were valued by independent professional valuers
based on the Direct Market Comparison Method and Investment Method at the end of the reporting period.
If the freehold and leasehold land and buildings stated at valuation were included in the ﬁnancial statements at
cost less accumulated depreciation, their net book values would be as follows:
Group
Freehold land and buildings
Leasehold land and buildings
2013
$’000
2012
$’000
32,491
45,700
41,860
44,714
The major properties included in freehold and leasehold land and buildings are as follows:
Location
Lettable
area
(Sq m)
Description
Tenure
10-storey
commercial building
99-year lease
expiring 2082
2,889
166-A, Riﬂe Range Road,
11400 Pulau Pinang
5-storey
commercial building
99-year lease
expiring 2109
11,136
Ambassador Row
Serviced Suites
at 1 Jalan Ampang Hilir,
55000 Kuala Lumpur
221 units of serviced
apartments in a
20-storey building
Freehold
Singapore
Winsland House I
at 3 Killiney Road
(Basement 1 and 10th ﬂoor)
Malaysia
17,452
Property, plant and equipment with net book values amounting to $84.5 million (2012: $80.2 million) were
mortgaged to banks to secure long term banking facilities granted to subsidiary companies (Note 24).
WING TAI ANNUAL REPORT 2013
81
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
23.
TRADE AND OTHER PAYABLES
Group
Company
2013
$’000
2012
$’000
2013
$’000
2012
$’000
—
—
151,678
155,982
95,716
30,956
—
—
—
4,378
—
—
Due to non-controlling interests
— non-trade [Note 23(iii)]
23,262
43,174
—
—
Accrued project costs
Accrued operating expenses
Trade creditors
Other creditors
Tenancy deposits
69,437
65,399
39,096
27,242
4,930
43,703
59,134
27,980
17,005
3,675
—
7,534
—
1,645
—
—
5,007
—
1,991
—
206,104
151,497
9,179
6,998
325,082
230,005
160,857
162,980
Due to subsidiary companies
— non-trade [Note 23(i)]
Due to associated and joint venture companies
— non-trade [Note 23(ii)]
Due to an investee company
— non-trade [Note 23(ii)]
Total trade and other payables
(i)
Non-trade amounts due to subsidiary companies are unsecured and repayable on demand. Included in the
amounts due to subsidiary companies are ﬁxed-interest payables of $17.7 million (2012: $40.7 million) and
ﬂoating-interest payables of $23.0 million (2012: $6.4 million).
(ii)
Non-trade amounts due to associated, joint venture and investee companies are unsecured, interest-free
and repayable on demand.
(iii)
Non-trade amounts due to non-controlling interests are unsecured, interest-free and repayable on demand.
The carrying amounts of trade and other payables approximated their fair values.
WING TAI ANNUAL REPORT 2013
82
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
24. BORROWINGS
Group
Current
— Secured term loans
— Unsecured bank loans
Non-current
— Secured bank loans
— Unsecured bank loans
— Unsecured medium term notes due in 2015
— Unsecured medium term notes due in 2016
— Unsecured medium term notes due in 2018
— Unsecured medium term notes due in 2022
— Unsecured medium term notes due in 2023
Total borrowings
Company
2013
$’000
2012
$’000
2013
$’000
2012
$’000
81,083
7,166
18,568
7,181
—
—
—
—
88,249
25,749
—
—
585,187
320,381
120,000
65,000
60,000
100,000
100,000
634,184
320,802
120,000
65,000
60,000
—
—
—
125,000
120,000
65,000
60,000
100,000
100,000
—
125,000
120,000
65,000
60,000
—
—
1,350,568
1,199,986
570,000
370,000
1,438,817
1,225,735
570,000
370,000
The carrying amounts of borrowings approximated their fair values.
(a)
Interest rate risks
The exposure of the borrowings of the Group and of the Company to interest rate changes and the
contractual repricing dates at the end of the reporting period are as follows:
Group
Less than one year
Between one and two years
Between two and ﬁve years
Over ﬁve years
(b)
Company
2013
$’000
2012
$’000
2013
$’000
2012
$’000
724,180
234,637
195,000
285,000
585,933
—
510,802
129,000
100,000
120,000
65,000
285,000
—
—
185,000
185,000
1,438,817
1,225,735
570,000
370,000
Security granted
The Group’s secured borrowings are generally secured by mortgages on certain development properties
(Note 14), investment properties (Note 21) and property, plant and equipment (Note 22) and assignment of
all rights, titles and beneﬁts with respect to the properties.
WING TAI ANNUAL REPORT 2013
83
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
25.
DIVIDENDS
Group and Company
2013
2012
$’000
$’000
Dividends paid in respect of the preceding financial year
First and ﬁnal dividend of 3 cents per share (2012: 3 cents per share)
Special dividend of 4 cents per share (2012: 4 cents per share)
23,502
31,336
23,426
31,234
54,838
54,660
The directors have recommended a ﬁrst and ﬁnal dividend in respect of the ﬁnancial year ended 30 June 2013
of 3 cents per share and a special dividend of 9 cents per share. These ﬁnancial statements do not reﬂect these
proposed dividends, which will be accounted for in the shareholders’ equity as an appropriation of retained
earnings in the ﬁnancial year ending 30 June 2014.
The proposed ﬁrst and ﬁnal dividend and special dividend in respect of the ﬁnancial year ended 30 June 2012
have been accounted for in the shareholders’ equity as an appropriation of retained earnings in the current
ﬁnancial year.
26. OTHER NON-CURRENT LIABILITIES
Group
Tenancy deposits
Loans from non-controlling interests
Retention payable
Others
2013
$’000
2012
$’000
3,924
8,995
24,084
3,054
3,946
9,015
17,390
3,056
40,057
33,407
Loans from non-controlling interests are unsecured, interest-free, have no ﬁxed terms of repayment and are not
expected to be repayable within the next 12 months.
The carrying amounts of other non-current liabilities approximated their fair values.
WING TAI ANNUAL REPORT 2013
84
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
27.
SHARE CAPITAL
Group and Company
Issued share capital
Number of
ordinary shares
Amount
’000
$’000
2013
Beginning and end of financial year
793,927
838,250
2012
Beginning and end of ﬁnancial year
793,927
838,250
All issued ordinary shares are fully paid. There is no par value for these ordinary shares.
(a)
The Wing Tai Holdings Limited (2001) Share Option Scheme (the “Scheme”)
The Scheme was approved and adopted by the members of the Company at an Extraordinary General
Meeting (“EGM”) held on 31 August 2001. The Scheme was terminated by the members of the Company
at an EGM held on 30 October 2008 (without prejudice to the rights of holders of options thereunder in
respect of options which have been granted).
Details of the movement in the options granted under the Scheme on the unissued ordinary shares of the
Company during the year were as follows:
Date of grant
2013
19.11.2004
30.09.2005
05.09.2006
06.09.2007
Total
WING TAI ANNUAL REPORT 2013
As at
01.07.2012
Number
of options
exercised
Number
of options
forfeited
As at
30.06.2013
249,700
601,800
1,153,900
1,842,500
15,400
77,000
226,200
—
—
—
16,500
16,500
234,300
524,800
911,200
1,826,000
3,847,900
318,600
33,000
3,496,300
Exercise
price ($)
0.849
1.300
1.645
3.136
Expiry date
18.11.2014
29.09.2015
04.09.2016
05.09.2017
85
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
27.
SHARE CAPITAL (continued)
(a)
The Wing Tai Holdings Limited (2001) Share Option Scheme (the “Scheme”) (continued)
Date of grant
As at
01.07.2011
Number
of options
exercised
Number
of options
forfeited
As at
30.06.2012
2012
02.11.2001
19.11.2004
30.09.2005
05.09.2006
06.09.2007
22,000
287,100
639,200
1,239,700
1,980,000
22,000
37,400
—
—
—
—
—
37,400
85,800
137,500
—
249,700
601,800
1,153,900
1,842,500
Total
4,168,000
59,400
260,700
3,847,900
Exercise
price ($)
0.616
0.849
1.300
1.645
3.136
Expiry date
01.11.2011
18.11.2014
29.09.2015
04.09.2016
05.09.2017
All the outstanding share options are exercisable. Options exercised during the ﬁnancial year resulted in
318,600 (2012: 59,400) treasury shares being reissued at an average price of $1.52 (2012: $0.76) per share.
The weighted average share price at the time of exercise was $1.96 (2012: $1.28) per share.
(b)
Share Plans
The Wing Tai Performance Share Plan (“Wing Tai PSP”) and the Wing Tai Restricted Share Plan (“Wing Tai
RSP”) (collectively referred to as the “Share Plans”) were adopted by the members of the Company at an
EGM held on 30 October 2008.
Wing Tai PSP
On 19 September 2012, awards were granted by the Company to qualifying employees pursuant to the Wing
Tai PSP in respect of 147,000 shares of the Company. Under the Wing Tai PSP, performance conditions are
set over a three-year performance period. A speciﬁed number of shares will be released by the Committee
to the participants at the end of the performance period, provided the threshold targets are achieved. The
total number of shares released varies depending on the achievement of pre-set performance targets over
the performance period. The achievement factor ranges from 0% to 200%.
Details of the movement in the awards of the Company during the year were as follows:
Date of grant
2013
03.09.2009
01.09.2010
08.09.2011
19.09.2012
Total
As at
01.07.2012
Number of
shares granted
Additional
shares awarded
arising from
targets achieved
100,000
121,000
183,000
—
—
—
—
147,000
1,100
—
—
—
101,100
—
—
—
—
121,000
183,000
147,000
404,000
147,000
1,100
101,100
451,000
Number of
shares released
As at
30.06.2013
WING TAI ANNUAL REPORT 2013
86
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
27.
SHARE CAPITAL (continued)
(b)
Share Plans (continued)
Wing Tai PSP (continued)
As at
01.07.2011
Date of grant
Number of
Number of
shares granted shares forfeited
As at
30.06.2012
2012
03.09.2009
01.09.2010
08.09.2011
146,000
175,000
—
—
—
265,000
46,000
54,000
82,000
100,000
121,000
183,000
Total
321,000
265,000
182,000
404,000
Wing Tai RSP
On 19 September 2012, awards were granted by the Company to qualifying employees pursuant to the
Wing Tai RSP in respect of 1,815,000 shares of the Company. Under the Wing Tai RSP, performance
conditions are set over a one-year performance period. A speciﬁed number of shares will be awarded to
eligible participants at the end of the performance period depending on the extent of achievement of the
performance conditions established. The shares have a vesting schedule of three years. The participant will
receive fully paid shares, without any cash consideration payable by the participant.
Details of the movement in the awards of the Company during the year were as follows:
As at
01.07.2012
Number of
shares granted
447,600
1,314,600
1,937,000
—
—
—
—
1,815,000
447,600
563,400
573,600
—
—
—
34,100
6,000
—
751,200
1,329,300
1,809,000
Total
3,699,200
1,815,000
1,584,600
40,100
3,889,500
Date of grant
As at
01.07.2011
Number of
shares granted
Number of
Number of
shares released shares forfeited
As at
30.06.2012
2012
18.05.2009
03.09.2009
01.09.2010
08.09.2011
842,800
870,800
2,103,000
—
—
—
—
2,086,000
829,200
373,200
630,900
—
13,600
50,000
157,500
149,000
—
447,600
1,314,600
1,937,000
Total
3,816,600
2,086,000
1,833,300
370,100
3,699,200
Date of grant
2013
03.09.2009
01.09.2010
08.09.2011
19.09.2012
WING TAI ANNUAL REPORT 2013
Number of
Number of
shares released shares forfeited
As at
30.06.2013
87
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
27.
SHARE CAPITAL (continued)
(b)
Share Plans (continued)
Wing Tai RSP (continued)
The fair values of the awards granted pursuant to the Wing Tai PSP and the Wing Tai RSP on 19 September
2012 (2012: 8 September 2011) determined using the Monte Carlo simulation model was $0.2 million
(2012: $0.2 million) and $2.8 million (2012: $2.6 million) respectively. The signiﬁcant inputs into the model
were share price at grant date of $1.65 (2012: $1.35) per share, standard deviation of expected share price
returns of 32.3% (2012: 50.2%), dividend yield of 3.8% (2012: 4.4%) and annual risk-free interest rates of
0.3% [one-year], 0.3% [two-years] and 0.3% [three-years] (2012: 0.1% [one-year], 0.1% [two-years] and 0.3%
[three-years]). The volatility measured at the standard deviation of expected share price returns is based
on the statistical analysis of monthly share prices over the past three years.
28.
OTHER RESERVES
Group
2012
(restated)
$’000
2011
(restated)
$’000
11,867
(11,285)
162,147
10,921
(20,149)
98,708
61,090
(125,406)
(11,466)
972
2013
$’000
Share-based payment reserve
Cash ﬂow hedge reserve
Asset revaluation reserve
Share of capital reserves of associated
and joint venture companies
Currency translation reserve
Treasury shares reserve
Statutory reserve
87,919
$’000
$’000
9,829
(33,817)
89,294
11,233
(257)
—
10,392
(3,503)
—
14,515
(136,894)
(13,710)
972
18,789
(140,834)
(15,823)
972
—
—
(11,466)
—
—
—
(13,710)
—
(45,637)
(71,590)
(490)
(6,821)
Group
2013
$’000
(a)
Share-based payment reserve
Beginning of ﬁnancial year
Employee share plans and share option scheme:
— Value of employee services (Notes 6 and 27)
— Reissuance of treasury shares
Attributable to non-controlling interests
End of ﬁnancial year
(b)
Cash flow hedge reserve
Beginning of ﬁnancial year
Fair value losses
Transfer to:
— development properties
— income statement
End of ﬁnancial year
Company
2013
2012
2012
(restated)
$’000
Company
2013
2012
$’000
$’000
10,392
9,359
10,921
9,829
2,772
(1,759)
(67)
3,197
(2,068)
(37)
2,600
(1,759)
—
3,101
(2,068)
—
11,867
10,921
11,233
10,392
(20,149)
(2,719)
(33,817)
(1,178)
(3,503)
(58)
(6,286)
(636)
—
11,583
1,426
13,420
—
3,304
—
3,419
(11,285)
(20,149)
(257)
(3,503)
WING TAI ANNUAL REPORT 2013
88
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
28.
OTHER RESERVES (continued)
Group
2013
$’000
(c)
(d)
(e)
(f)
(g)
Asset revaluation reserve
Beginning of ﬁnancial year
Revaluation gains on property, plant and equipment
Deferred income tax charged to other
comprehensive income [Note 8(b)]
Transfer to retained earnings upon realisation
Attributable to non-controlling interests
98,708
75,094
(11,732)
(149)
226
2012
(restated)
$’000
89,294
10,964
(1,475)
(51)
(24)
Company
2013
2012
$’000
$’000
—
—
—
—
—
—
—
—
—
—
End of ﬁnancial year
162,147
98,708
—
—
Share of capital reserves of associated and
joint venture companies
Beginning of ﬁnancial year
Effect of adopting Amendments to FRS 12
14,566
(51)
18,840
(51)
—
—
—
—
As restated
Share of capital reserves of:
— an associated company
— joint venture companies
Attributable to non-controlling interests
14,515
18,789
—
—
48,140
—
(1,565)
(4,854)
425
155
—
—
—
—
—
—
End of ﬁnancial year
61,090
14,515
—
—
Currency translation reserve
Beginning of ﬁnancial year
Effect of adopting Amendments to FRS 12
(132,059)
(4,835)
(133,362)
(7,472)
—
—
—
—
As restated
(136,894)
Translation of ﬁnancial statements of foreign
subsidiary, associated and joint venture companies
11,059
Translation of foreign currency denominated loans
which form part of net investment in
subsidiary companies
(343)
Attributable to non-controlling interests
772
(140,834)
—
—
15,752
—
—
(12,402)
590
—
—
—
—
End of ﬁnancial year
(125,406)
(136,894)
—
—
Treasury shares reserve
Beginning of ﬁnancial year
Reissuance of treasury shares
(13,710)
2,244
(15,823)
2,113
(13,710)
2,244
(15,823)
2,113
End of ﬁnancial year
(11,466)
(13,710)
(11,466)
(13,710)
Statutory reserve
Beginning and end of ﬁnancial year
Total
WING TAI ANNUAL REPORT 2013
972
87,919
972
(45,637)
—
(490)
—
(6,821)
89
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
28.
OTHER RESERVES (continued)
Capital reserves of associated and joint venture companies arise from currency translation and other reserves
which are not distributable.
Included in the issued ordinary shares of the Company as at 30 June 2013 was 10,242,700 (2012: 12,247,000)
treasury shares held by the Company.
The Company reissued 2,004,300 (2012: 1,892,700) treasury shares during the ﬁnancial year pursuant to the
Wing Tai PSP, Wing Tai RSP and share options. The purchase cost of the treasury shares reissued amounted to
$2.2 million (2012: $2.1 million). The total consideration for the treasury shares reissued which comprised the value
of employee services amounted to $1.8 million (2012: $2.1 million).
29.
RETAINED EARNINGS
(a)
Retained earnings of the Group are distributable except for accumulated retained earnings of associated
and joint venture companies amounting to $721.8 million (2012: $464.6 million) and treasury shares reserve
amounting to $11.5 million (2012: $13.7 million). Retained earnings of the Company are distributable except
for the treasury shares reserve of $11.5 million (2012: $13.7 million).
(b)
Movement in retained earnings for the Company were as follows:
Company
2013
$’000
2012
$’000
Beginning of ﬁnancial year
Net proﬁt
Dividends paid (Note 25)
225,204
88,616
(54,838)
97,901
181,963
(54,660)
End of ﬁnancial year
258,982
225,204
WING TAI ANNUAL REPORT 2013
90
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
30. COMMITMENTS
(a)
Capital commitments
Capital expenditures contracted for at the end of the reporting period but not recognised in the ﬁnancial
statements, excluding those relating to investments in joint venture companies (Note 19), are as follows:
Group
Commitments in respect of contracts placed
(b)
2013
$’000
2012
$’000
218,494
224,864
Operating lease commitments — where the Group is a lessee
The Group leases various retail units under non-cancellable operating lease agreements. The leases have
varying terms, escalation clauses and renewal rights.
The future minimum lease payables under non-cancellable operating leases contracted for at the end of the
reporting period but not recognised as liabilities, are as follows:
Group
Not later than one year
Between one and ﬁve years
(c)
2013
$’000
2012
$’000
46,334
67,395
42,685
42,935
113,729
85,620
Operating lease commitments — where the Group is a lessor
The Group leases out ofﬁce units and serviced apartments under non-cancellable operating lease
agreements. The leases have varying terms, escalation clauses and renewal rights.
The future minimum lease receivables under non-cancellable operating leases contracted for at the end of
the reporting period but not recognised as receivables, are as follows:
Group
Not later than one year
Between one and ﬁve years
WING TAI ANNUAL REPORT 2013
2013
$’000
2012
$’000
19,782
17,463
20,911
19,450
37,245
40,361
91
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
31.
CONTINGENT LIABILITIES AND FINANCIAL GUARANTEES
The details and estimates of the maximum amounts of contingent liabilities and ﬁnancial guarantees, excluding
those relating to investment in an associated company (Note 18), are as follows:
Group
Financial guarantees issued to banks for
credit facilities granted to:
— subsidiary companies
— joint venture companies
Company
2013
$’000
2012
$’000
2013
$’000
2012
$’000
—
21,372
—
11,743
202,981
8,280
208,702
8,280
21,372
11,743
211,261
216,982
The Company has given ﬁnancial guarantees for all liabilities incurred under a tender bond facility of a subsidiary
company amounting to $15.0 million (2012: $15.0 million) granted by a bank to the subsidiary company.
32.
FINANCIAL RISK MANAGEMENT
Financial risk factors
The Group’s activities expose it to market risk (including currency risk and interest rate risk), credit risk and
liquidity risk. The Group’s overall risk management strategy seeks to minimise any adverse effects from the
unpredictability of ﬁnancial markets on the Group’s ﬁnancial performance. After identifying and evaluating its
exposure to the ﬁnancial risks, the Group establishes policies to monitor and manage these risks in accordance
with its risk management philosophy. The Group uses ﬁnancial instruments such as currency forwards, cross
currency swaps, interest rate swaps and foreign currency borrowings to hedge certain ﬁnancial risk exposures.
(a)
Market risk
(i)
Currency risk
The Group operates in Asia with dominant operations in Singapore, Malaysia, Hong Kong SAR and
the People’s Republic of China. Entities in the Group may transact in currencies other than their
respective functional currencies. Currency risk arises within entities in the Group when transactions
are denominated in foreign currencies. To manage the currency exposure, the Group enters into
currency forwards with banks.
The Group also holds long-term overseas investments and its net assets are exposed to currency
translation risk. The Group uses natural hedging opportunities, like borrowing in the currency of the
country in which these investments are located whenever practicable. The exchange differences
arising from such translations are captured under the currency translation reserve. These translation
differences are reviewed and monitored on a regular basis.
WING TAI ANNUAL REPORT 2013
92
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(a)
Market risk (continued)
(i)
Currency risk (continued)
The Group’s currency exposure is as follows:
2013
Financial assets
Cash and cash equivalents
Available-for-sale
ﬁnancial assets
Trade and other receivables
(current and non-current)
Other ﬁnancial assets
Financial liabilities
Trade and other payables
Borrowings
Other ﬁnancial liabilities
Net ﬁnancial (liabilities)/
assets
SGD
$’000
RM
$’000
USD
$’000
HKD
$’000
Other
$’000
Total
$’000
922,518
54,320
9,582
8,057
30,064
1,024,541
3,189
—
—
—
—
3,189
375,005
11,614
72,873
2,459
665
1
9,989
8
—
1,831
458,532
15,913
1,312,326
129,652
10,248
18,054
31,895
1,502,175
(231,402)
(1,204,905)
(22,516)
(63,834)
(127,531)
(10,090)
(3,242)
(44,604)
(4,397)
(759)
(61,777)
—
(25,845)
—
—
(325,082)
(1,438,817)
(37,003)
(1,458,823)
(201,455)
(52,243)
(62,536)
(146,497)
(71,803)
(41,995)
(44,482)
6,050
(298,727)
57,159
84,035
46,329
(10,684)
(9,773)
167,066
—
—
(2,479)
(1,585)
(4,542)
(8,606)
11,753
(25,845) (1,800,902)
Net ﬁnancial liabilities/
(assets) denominated in
the respective entities’
functional currencies
Firm commitments and
highly probable forecast
transactions in foreign
currencies
Currency forwards and
cross currency swaps
(62,428)
—
3,705
63,981
6,495
Currency exposure
(151,766)
12,232
5,560
7,230
(1,770)
WING TAI ANNUAL REPORT 2013
(128,514)
93
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(a)
Market risk (continued)
(i)
Currency risk (continued)
2012
Financial assets
Cash and cash equivalents
Available-for-sale
ﬁnancial assets
Trade and other receivables
(current and non-current)
Other ﬁnancial assets
Financial liabilities
Trade and other payables
Borrowings
Other ﬁnancial liabilities
Net ﬁnancial (liabilities)/
assets
Net ﬁnancial liabilities/
(assets) denominated
in the respective entities’
functional currencies
Firm commitments and
highly probable forecast
transactions in foreign
currencies
Currency forwards and
cross currency swaps
Currency exposure
SGD
$’000
RM
$’000
USD
$’000
HKD
$’000
Other
$’000
Total
$’000
748,443
21,068
58,390
5,767
15,018
848,686
7,170
—
—
—
—
7,170
253,028
11,407
28,276
2,531
676
3
6,885
7
—
194
288,865
14,142
1,020,048
51,875
59,069
12,659
15,212
1,158,863
(187,278)
(1,017,238)
(15,772)
(34,735)
(101,695)
(10,163)
(2,286)
(44,800)
(4,416)
(474)
(62,002)
—
(5,232)
—
—
(230,005)
(1,225,735)
(30,351)
(1,220,288)
(146,593)
(51,502)
(62,476)
(5,232)
(1,486,091)
(200,240)
(94,718)
7,567
(49,817)
9,980
(327,228)
46,501
(7,577)
(12,868)
237,736
110,668
101,012
—
—
(1,584)
(62,370)
—
4,638
62,370
(151,942)
6,294
57,122
4,976
—
(3,915)
(5,499)
5,858
10,496
(945)
(84,495)
WING TAI ANNUAL REPORT 2013
94
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(a)
Market risk (continued)
(i)
Currency risk (continued)
The Company’s currency exposure is as follows:
2013
Financial assets
Cash and cash equivalents
Available-for-sale ﬁnancial assets
Trade and other receivables
(current and non-current)
Other ﬁnancial assets
Financial liabilities
Trade and other payables
Borrowings
Net ﬁnancial assets
Net ﬁnancial assets denominated in
the Company’s functional currency
Currency exposure
WING TAI ANNUAL REPORT 2013
SGD
$’000
RM
$’000
USD
$’000
HKD
$’000
Total
$’000
588,723
3,189
10,273
—
22
—
7,262
—
606,280
3,189
799,738
1,263
2,588
—
116,699
1
43,227
5
962,252
1,269
1,392,913
12,861
116,722
50,494
1,572,990
(155,881)
(570,000)
—
—
(4,891)
—
(85)
—
(160,857)
(570,000)
(725,881)
—
(4,891)
(85)
(730,857)
667,032
(667,032)
—
12,861
111,831
50,409
—
—
—
12,861
111,831
50,409
842,133
(667,032)
175,101
95
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(a)
Market risk (continued)
(i)
Currency risk (continued)
2012
Financial assets
Cash and cash equivalents
Available-for-sale ﬁnancial assets
Trade and other receivables
(current and non-current)
Other ﬁnancial assets
Financial liabilities
Trade and other payables
Borrowings
Net ﬁnancial assets
Net ﬁnancial assets denominated in
the Company’s functional currency
Currency exposure
SGD
$’000
RM
$’000
USD
$’000
HKD
$’000
Total
$’000
430,963
3,189
5,639
—
16
—
5,042
—
441,660
3,189
735,211
2,414
2,633
—
97,774
1
53,846
4
889,464
2,419
1,171,777
8,272
97,791
58,892
1,336,732
(113,176)
(370,000)
—
—
(49,594)
—
(210)
—
(162,980)
(370,000)
(483,176)
—
(49,594)
(210)
(532,980)
688,601
(688,601)
—
8,272
48,197
58,682
—
—
—
8,272
48,197
58,682
803,752
(688,601)
115,151
WING TAI ANNUAL REPORT 2013
96
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(a)
Market risk (continued)
(i)
Currency risk (continued)
If the RM, USD and HKD change against the SGD by 1% (2012: 1%) each with all other variables
including tax rate being held constant, the effects arising from the net ﬁnancial asset/liability position
will be as follows:
Increase/(decrease)
Profit after tax
2013
2012
$’000
$’000
(ii)
Increase/(decrease)
Other comprehensive
income
2013
2012
$’000
$’000
GROUP
RM against SGD
— strengthened
— weakened
123
(123)
63
(63)
—
—
—
—
USD against SGD
— strengthened
— weakened
979
(979)
1,486
(1,486)
—
—
—
—
HKD against SGD
— strengthened
— weakened
706
(706)
670
(670)
COMPANY
RM against SGD
— strengthened
— weakened
129
(129)
83
(83)
—
—
—
—
USD against SGD
— strengthened
— weakened
1,118
(1,118)
482
(482)
—
—
—
—
HKD against SGD
— strengthened
— weakened
504
(504)
587
(587)
—
—
—
—
(618)
618
(620)
620
Cash ﬂow and fair value interest rate risks
Cash ﬂow interest rate risk is the risk that the future cash ﬂows of a ﬁnancial instrument will ﬂuctuate
because of changes in market interest rates. Fair value interest rate risk is the risk that the fair value
of a ﬁnancial instrument will ﬂuctuate due to changes in market interest rates.
WING TAI ANNUAL REPORT 2013
97
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(a)
Market risk (continued)
(ii)
Cash ﬂow and fair value interest rate risks (continued)
The Group’s and the Company’s exposure to cash ﬂow interest rate risks arises mainly from ﬂoating
rate borrowings. The Group manages these cash ﬂow interest rate risks by maintaining a prudent mix
of ﬁxed and ﬂoating rate borrowings and using ﬂoating-to-ﬁxed interest rate swaps.
The Group’s borrowings at ﬂoating rates on which effective hedges have not been entered into are
denominated mainly in SGD, RM and USD. If the SGD, RM and USD interest rates increase/decrease
by 1% (2012: 1%) with all other variables including tax rate being held constant, the proﬁt after tax
would have been lower/higher by $3.0 million (2012: $0.7 million) as a result of higher/lower interest
expense on these borrowings. Other comprehensive income would have been higher/lower by
$1.6 million (2012: $5.3 million) as a result of higher/lower fair value of interest rate swaps designated
as cash ﬂow hedges of ﬂoating rate borrowings.
The Company’s borrowings at ﬂoating rates on which effective hedges have been entered into are
denominated in SGD. If the SGD interest rates increase/decrease by 1% (2012: 1%) with all other
variables including tax rate being held constant, the proﬁt after tax would have been lower/higher
by $1.0 million (2012: Nil) as a result of higher/lower interest expense on these borrowings. Other
comprehensive income would have been higher/lower by Nil (2012: $1.0 million) as a result of higher/
lower fair value of interest rate swaps designated as cash ﬂow hedges of ﬂoating rate borrowings.
(b)
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in
ﬁnancial loss to the Group. The major classes of ﬁnancial assets of the Group and of the Company are bank
deposits and trade and other receivables. The Group has no signiﬁcant concentration of credit risk with
any single entity. The Group has policies in place to ensure that the sales of products and the rendering of
services are to customers with acceptable credit standing. Derivative counterparties and cash transactions
are limited to high credit quality ﬁnancial institutions. The Group has policies that limit the amount of credit
exposure to any ﬁnancial institution.
As the Group and the Company do not hold any collateral, the maximum exposure to credit risk for each
class of ﬁnancial instruments is the carrying amount of that class of ﬁnancial instruments presented on the
statements of ﬁnancial position, except as disclosed in Note 31.
WING TAI ANNUAL REPORT 2013
98
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(b)
Credit risk (continued)
The credit risk for trade receivables is as follows:
Group
By business segments
Development properties
Investment properties
Retail
Others
2013
$’000
2012
$’000
98,464
1,228
4,230
976
50,092
939
2,614
3,143
104,898
56,788
(i)
Financial assets that are neither past due nor impaired
Bank deposits that are neither past due nor impaired are mainly deposits with banks with high
credit-ratings assigned by international credit-rating agencies. Trade and other receivables that are
neither past due nor impaired are substantially companies with a good collection track record with
the Group.
(ii)
Financial assets that are past due and/or impaired
There is no other class of ﬁnancial assets that is past due and/or impaired except for trade and
other receivables.
The age analysis of trade receivables past due but not impaired is as follows:
Group
Past due less than 3 months
Past due 3 to 6 months
Past due over 6 months
WING TAI ANNUAL REPORT 2013
2013
$’000
2012
$’000
18,742
109
436
2,608
769
553
19,287
3,930
99
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(b)
Credit risk (continued)
The carrying amount of trade and other receivables individually determined to be impaired and the
movement in the related allowance for impairment are as follows:
Group
2013
$’000
Gross amount
Less: Allowance for impairment
391
(391)
—
Company
2012
$’000
435
(435)
—
2013
$’000
2012
$’000
373,984
(205,601)
401,253
(199,651)
168,383
201,602
Beginning of ﬁnancial year
Allowance (written back)/made
Allowance utilised
Currency translation differences
435
(26)
(17)
(1)
1,104
67
(730)
(6)
199,651
5,950
—
—
173,203
26,448
—
—
End of ﬁnancial year
391
435
205,601
199,651
The impaired trade and other receivables arose mainly from loans to subsidiary companies for which
recoverability is uncertain.
(c)
Liquidity risk
The Group actively manages its debt maturity proﬁle, operating cash ﬂows and the availability of funding
so as to ensure that all reﬁnancing, repayment and funding needs are met. The Group adopts prudent
liquidity risk management by maintaining sufﬁcient cash and the availability of funding through an adequate
amount of committed credit facilities. The Group raises committed funding from both capital markets and
ﬁnancial institutions and prudently balances its portfolio with short term funding so as to achieve overall
cost effectiveness.
WING TAI ANNUAL REPORT 2013
100
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(c)
Liquidity risk (continued)
The table below analyses the maturity proﬁle of the Group’s and the Company’s ﬁnancial liabilities (including
derivative ﬁnancial liabilities) based on contractual undiscounted cash ﬂows. Balances due within 12 months
equal their carrying amounts as the impact of discounting is not signiﬁcant.
GROUP
2013
Net-settled interest rate swaps
Gross-settled cross currency swap
— Receipts
— Payments
Gross-settled currency forwards
— Receipts
— Payments
Trade and other payables
Borrowings
Other ﬁnancial liabilities
2012
Net-settled interest rate swaps
Gross-settled cross currency swap
— Receipts
— Payments
Gross-settled currency forwards
— Receipts
— Payments
Trade and other payables
Borrowings
Other ﬁnancial liabilities
WING TAI ANNUAL REPORT 2013
Less than
1 year
$’000
Between
1 and 2
years
$’000
Between
2 and 5
years
$’000
Over
5 years
$’000
2,204
405
—
—
—
—
—
—
(2,054)
3,713
(62,424)
68,873
(11,753)
11,603
325,082
128,699
—
—
—
—
318,656
27,752
—
—
—
775,811
9,228
—
—
—
396,948
23
457,494
353,262
785,039
396,971
7,868
2,092
380
—
(2,078)
3,713
(2,078)
3,713
(62,657)
68,873
—
—
(10,496)
10,369
230,005
59,779
—
—
—
—
277,708
24,175
—
—
—
746,733
6,139
—
—
—
274,452
37
299,160
305,610
759,468
274,489
101
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(c)
Liquidity risk (continued)
COMPANY
2013
Net-settled interest rate swaps
Trade and other payables
Borrowings
2012
Net-settled interest rate swaps
Trade and other payables
Borrowings
Less than
1 year
$’000
Between
1 and 2
years
$’000
Between
2 and 5
years
$’000
Over
5 years
$’000
180
162,162
20,182
—
—
139,802
—
—
209,466
—
—
324,461
182,524
139,802
209,466
324,461
3,313
164,717
10,657
175
—
10,657
—
—
206,656
—
—
189,845
178,687
10,832
206,656
189,845
In addition to the above, the Group and the Company issued ﬁnancial guarantees of $21.4 million
(2012: $11.7 million) and $211.3 million (2012: $217.0 million) respectively (Note 31).
WING TAI ANNUAL REPORT 2013
102
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(d)
Capital risk
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going
concern and to maintain an optimal capital structure so as to maximise shareholder value. In order to
maintain or achieve an optimal capital structure, the Group may adjust the amount of dividend payment,
return capital to shareholders, issue new shares, buy back issued shares, obtain new borrowings or
reduce borrowings.
Management monitors capital based on debt-equity ratio. The debt-equity ratio is calculated as net debt
divided by shareholders’ equity. Net debt is calculated as borrowings less cash and cash equivalents.
Group
2012
(restated)
$’000
2011
(restated)
$’000
1,438,817
1,225,735
(1,024,541)
2013
2012
$’000
$’000
1,179,217
570,000
370,000
(848,686)
(504,235)
(606,280)
(441,660)
414,276
377,049
674,982
(36,280)
(71,660)
2,840,640
2,230,989
1,996,704
15%
17%
34%
$’000
Borrowings
Less: Cash and
cash equivalents
Net debt
Shareholders’ equity
Debt-equity ratio
Company
2013
1,096,742
(3%)
1,056,633
(7%)
The Group and the Company are required by some banks to maintain a certain level of the debt-equity ratio.
The Group and the Company are in compliance with all externally imposed capital requirements for the
ﬁnancial years ended 30 June 2013 and 2012.
WING TAI ANNUAL REPORT 2013
103
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(e)
Fair value measurements
The following table presents assets and liabilities measured at fair value and classiﬁed by level of the
following fair value measurement hierarchy:
(i)
(ii)
(iii)
quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);
inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived from prices) (Level 2); and
inputs for the asset or liability that are not based on observable market data (unobservable inputs)
(Level 3).
Level 1
$’000
Level 2
$’000
Level 3
$’000
Total
$’000
GROUP
2013
Assets
Available-for-sale ﬁnancial assets
—
—
3,189
3,189
Liabilities
Derivative ﬁnancial instruments
—
11,786
—
11,786
2012
Assets
Available-for-sale ﬁnancial assets
—
—
7,170
7,170
Liabilities
Derivative ﬁnancial instruments
—
20,669
—
20,669
COMPANY
2013
Assets
Available-for-sale ﬁnancial assets
—
—
3,189
3,189
Liabilities
Derivative ﬁnancial instruments
—
257
—
257
2012
Assets
Available-for-sale ﬁnancial assets
—
—
3,189
3,189
Liabilities
Derivative ﬁnancial instruments
—
3,503
—
3,503
WING TAI ANNUAL REPORT 2013
104
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
32.
FINANCIAL RISK MANAGEMENT (continued)
(e)
Fair value measurements (continued)
The fair value of interest rate and cross currency swaps is calculated as the present value of the estimated
future cash ﬂows. The fair value of currency forwards is determined using quoted forward currency rates at
the end of the reporting period. These instruments are classiﬁed as Level 2 and comprise derivative ﬁnancial
instruments. The valuation technique for available-for-sale ﬁnancial assets is based on unobservable inputs,
as such, these assets are classiﬁed as Level 3. Any changes to these unobservable inputs will not have a
material impact on the fair value of the available-for-sale ﬁnancial assets.
(f)
Financial instruments by category
The carrying amount of the different categories of ﬁnancial instruments is as disclosed on the face of the
statements of ﬁnancial position and in Notes 11 and 16 to the ﬁnancial statements, except for the following:
Group
Loans and receivables
Financial liabilities at amortised cost
WING TAI ANNUAL REPORT 2013
Company
2013
$’000
2012
$’000
2013
$’000
2012
$’000
1,498,986
1,800,902
1,151,693
1,486,091
1,569,801
730,857
1,333,543
532,980
105
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
33.
RELATED PARTY TRANSACTIONS
In addition to the related party information disclosed elsewhere in the ﬁnancial statements, the following signiﬁcant
transactions took place between the Group and related parties during the ﬁnancial year at terms agreed between
the parties:
(a)
Rendering of services
Group
Sale of development property to a joint venture company
Commission income received from joint venture companies
Management and service fees received from joint venture companies
Management fees paid to an associated company
Payments on behalf of joint venture companies
(b)
2013
$’000
2012
$’000
57,650
291
3,945
834
7,158
—
1,076
2,542
833
6,754
Key management personnel compensation
Key management personnel compensation is as follows:
Group
Salaries and other short term employee beneﬁts
Share-based payment
2013
$’000
2012
$’000
15,201
912
12,124
1,075
16,113
13,199
Included in the above is compensation to directors of the Company which amounted to $10.0 million
(2012: $8.2 million).
WING TAI ANNUAL REPORT 2013
106
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
34. SEGMENT INFORMATION
The Group is organised into three main business segments – development properties, investment properties and
retail. Other operations of the Group comprise mainly garment manufacturing and investment holding, neither
of which constitutes a separately reportable segment. The segment information for the reportable segments is
as follows:
2013
Revenue
EBIT
Interest income
Development
properties
$’000
Investment
properties
$’000
Retail
$’000
Others
$’000
Group
$’000
1,077,589
37,452
210,020
7,439
1,332,500
369,856
74,902
14,353
(34,682)
424,429
11,018
Operating proﬁt
435,447
Finance costs
Share of proﬁts of associated
and joint venture companies
(39,383)
41,088
208,840
11,104
33,721
Proﬁt before income tax
690,817
Income tax expense
(102,926)
Total profit
Segment assets
Investment in an
associated company
Investments in joint
venture companies
Due from associated and
joint venture companies
587,891
2,571,154
655,954
75,352
78,393
3,380,853
207,939
833,020
—
2,634
1,043,593
155,419
2,838
43,908
5,134
207,299
332,595
11
2,260
8,783
343,649
3,267,107
1,491,823
121,520
94,944
4,975,394
Tax recoverable
2,378
Consolidated total assets
Segment liabilities
Borrowings
4,977,772
159,781
447,504
11,639
225,932
28,608
—
176,897
765,381
376,925
1,438,817
607,285
237,571
28,608
942,278
1,815,742
Current income tax liabilities
Deferred income tax liabilities
72,683
62,267
Consolidated total liabilities
Capital expenditure
Depreciation
WING TAI ANNUAL REPORT 2013
294,753
1,950,692
521
227
1,690
1,581
12,604
7,037
5,680
3,644
20,495
12,489
107
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
34. SEGMENT INFORMATION (continued)
Development
properties
$’000
Investment
properties
$’000
Retail
$’000
Others
$’000
Group
$’000
Revenue
363,919
37,891
216,462
6,616
624,888
EBIT
Interest income
118,960
39,138
21,540
(22,189)
157,449
8,058
2012 (restated)
Operating proﬁt
Finance costs
Share of proﬁts of associated
and joint venture companies
165,507
(37,161)
75,382
108,157
8,138
(2,202)
Proﬁt before income tax
189,475
317,821
Income tax expense
(33,687)
Total proﬁt
284,134
Segment assets
Investment in an
associated company
Investments in joint
venture companies
Due from associated and
joint venture companies
1,946,475
744,254
62,473
132,529
2,885,731
157,129
541,571
4,621
33,046
736,367
101,517
13,589
33,793
12,533
161,432
186,738
6,108
1,748
28,477
223,071
2,391,859
1,305,522
102,635
206,585
4,006,601
Tax recoverable
1,740
Consolidated total assets
Segment liabilities
Borrowings
4,008,341
109,110
429,056
13,964
230,877
29,144
—
131,863
565,802
284,081
1,225,735
538,166
244,841
29,144
697,665
1,509,816
Current income tax liabilities
Deferred income tax liabilities
83,561
17,137
Consolidated total liabilities
Capital expenditure
Depreciation
1,610,514
306
264
994
1,805
5,143
6,304
2,822
3,565
9,265
11,938
WING TAI ANNUAL REPORT 2013
108
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
34. SEGMENT INFORMATION (continued)
2011 (restated)
Segment assets
Investment in an
associated company
Investments in joint
venture companies
Due from associated and
joint venture companies
Development
properties
$’000
Investment
properties
$’000
Retail
$’000
Others
$’000
Group
$’000
1,857,749
730,709
66,609
120,945
2,776,012
156,772
410,891
4,923
29,912
602,498
141,119
12,743
23,573
12,334
189,769
178,546
6,563
1,221
25,625
211,955
2,334,186
1,160,906
96,326
188,816
3,780,234
Tax recoverable
5,758
Consolidated total assets
Segment liabilities
Borrowings
3,785,992
115,001
532,505
16,431
223,492
30,052
—
139,581
423,220
301,065
1,179,217
647,506
239,923
30,052
562,801
1,480,282
Current income tax liabilities
Deferred income tax liabilities
81,808
39,818
Consolidated total liabilities
1,601,908
The Group’s three main business segments operate in three main geographical areas – Singapore, Malaysia and
the People’s Republic of China (“PRC”)/Hong Kong SAR.
Revenue
Singapore
Malaysia
PRC/Hong Kong SAR
WING TAI ANNUAL REPORT 2013
Non-current assets
2012
2011
(restated)
(restated)
$’000
$’000
2013
2012
2013
$’000
$’000
$’000
932,812
375,940
23,748
507,576
116,426
886
1,010,009
113,329
1,116,962
1,015,635
106,769
763,085
1,018,880
106,658
623,543
1,332,500
624,888
2,240,300
1,885,489
1,749,081
109
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
35.
COMPANIES IN THE GROUP
Information relating to the companies in the Group is given below, with the exception of inactive and dormant
companies. Singapore-incorporated subsidiary and joint venture companies are audited by PricewaterhouseCoopers
LLP, Singapore unless otherwise indicated.
Country of
incorporation/
place of business
Name of companies
(a)
Wing Tai Holdings Limited
(b)
Subsidiary companies
Principal activities
Equity held
by the Group
2013
2012
%
%
Singapore-Quoted
on Singapore
Exchange Securities
Trading Limited
Investment holding
n/a
n/a
Wing Tai Malaysia Berhad
!
Malaysia-Quoted
on Bursa Malaysia
Securities Berhad
Investment holding
60.9
61.1
Angel Wing (M) Sdn. Bhd.
*, !
Malaysia
Property development
60.9
61.1
Angkasa Indah Sdn. Bhd.
*, !
Malaysia
Property development
60.9
61.1
Brave Dragon Ltd
*, %
British Virgin
Islands (“BVI”)/
Hong Kong SAR
Investment holding
89.4
89.4
Chanlai Sdn. Bhd.
*, !
Malaysia
Property development
60.9
61.1
Crossbrook Group Ltd
#
BVI/Hong Kong SAR
Investment holding
100
100
DNP Clothing Sdn. Bhd.
*, !
Malaysia
Retailing of garments
60.9
61.1
DNP Fashion Sdn. Bhd.
*, !
Malaysia
Retailing of garments
60.9
61.1
DNP Hartajaya Sdn. Bhd.
*, !
Malaysia
Property development
60.9
61.1
DNP Jaya Sdn. Bhd.
*, !
Malaysia
Property investment
60.9
61.1
DNP Land Sdn. Bhd.
*, !
Malaysia
Property development
60.9
61.1
DNP Property Management
Sdn. Bhd.
*, !
Malaysia
Project management and 60.9
maintenance of properties
61.1
D & P-Ejenawa Sdn. Bhd.
*, !
Malaysia
Property development
61.1
60.9
n/a: not applicable
WING TAI ANNUAL REPORT 2013
110
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
35.
COMPANIES IN THE GROUP (continued)
Name of companies
(b)
Country of
incorporation/
place of business
Principal activities
Equity held
by the Group
2013
2012
%
%
Subsidiary companies (continued)
Grand Eastern Realty &
Development Sdn. Bhd.
*, !
Malaysia
Property development
60.9
61.1
Harta-Aman Sdn. Bhd.
*, !
Malaysia
Property development
60.9
61.1
Hartamaju Sdn. Bhd.
*, !
Malaysia
Property development
60.9
61.1
Jiaxin (Suzhou) Property
Development Co., Ltd
*, >
PRC
Property development,
investment and
management
75
75
Quality Frontier Sdn. Bhd.
*, !
Malaysia
Property development
60.9
61.1
Seniharta Sdn. Bhd.
*, !
Malaysia
Property investment
60.9
61.1
Sri Rampaian Sdn. Bhd.
*, !
Malaysia
Manufacture of
textile garments
60.9
61.1
Starpuri Development
Sdn. Bhd.
*, !
Malaysia
Property development
60.9
61.1
Suzhou Property
Development Pte Ltd
*
Singapore
Property development
and investment holding
75
75
Winace Investment Pte Ltd
*
Singapore
Investment holding
100
100
Wincharm Investment Pte Ltd
*
Singapore
Investment holding
100
100
Wincheer Investment Pte Ltd
*
Singapore
Property investment
and development
100
100
Wingold Investment Pte Ltd
*
Singapore
Investment holding
100
100
Winglow Investment Pte. Ltd.
*
Singapore
Investment holding
100
100
Wingstar Investment Pte. Ltd.
*
Singapore
Investment holding
100
100
WING TAI ANNUAL REPORT 2013
111
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
35.
COMPANIES IN THE GROUP (continued)
Principal activities
*
Singapore
Property investment
100
100
Winnervest Investment Pte Ltd *
Singapore
Property investment
and development
100
100
Winnorth Investment Pte Ltd
*
Singapore
Property investment
and development
100
100
Winquest Investment Pte Ltd
*
Singapore
Property investment
and development
60
60
Winrose Investment Pte Ltd
*
Singapore
Property investment
and development
100
100
Winshine Investment Pte Ltd
*
Singapore
Property investment
100
100
Winsland Investment Pte Ltd
*
Singapore
Property investment
100
100
Winsmart Investment Pte Ltd
*
Singapore
Property investment
and development
100
100
Winswift Investment Pte Ltd
*
Singapore
Investment holding
60.9
61.1
Wing Mei (M) Sdn. Bhd.
*, !
Malaysia
Property investment
60.9
61.1
Wing Tai (China)
Investment Pte. Ltd.
*
Singapore
Investment holding
100
100
Wing Tai Clothing Pte Ltd
*
Singapore
Retailing of garments
100
100
Wing Tai Fashion Apparel Pte.
Ltd. (formerly known as Fox
Fashion Apparel (S) Pte. Ltd.)
*
Singapore
Retailing of garments
100
100
Singapore
Investment holding
100
100
Singapore
Management of
investment properties
100
100
Singapore
Investment holding
100
100
Name of companies
(b)
Equity held
by the Group
2013
2012
%
%
Country of
incorporation/
place of business
Subsidiary companies (continued)
Winmax Investment Pte Ltd
Wing Tai Investment
& Development Pte Ltd
Wing Tai Investment
Management Pte Ltd
Wing Tai Land Pte Ltd
*
WING TAI ANNUAL REPORT 2013
112
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
35.
COMPANIES IN THE GROUP (continued)
Country of
incorporation/
place of business
Name of companies
(b)
Subsidiary companies (continued)
Wing Tai Property
Management Pte Ltd
*
Singapore
Project management
and maintenance
of properties
100
100
Singapore
Investment holding
100
100
Singapore
Management of retail
operations
100
100
Yong Yao (Shanghai) Property *
Development Co., Ltd
PRC
Property development
100
—
Yoshinoya (S) Pte Ltd
*
Singapore
Restaurant operator
100
100
*, %
Bermuda-Quoted
on The Stock
Exchange of
Hong Kong Limited/
Hong Kong SAR
Property development,
property investment and
management, hospitality
investment and
management, garment
manufacturing and
investing activities
33.5
33.6
Choice Homes Beta Pte Ltd
*, ^
Singapore
Property investment
and development
30
30
Orwin Development Limited
*
Singapore
Property investment
and development
40
40
Summervale Properties Pte Ltd *, &
Singapore
Property investment
and development
50
50
Winpride Investment Pte. Ltd.
Singapore
Property investment
and development
40
40
Wing Tai Retail Pte. Ltd.
Wing Tai Retail
Management Pte. Ltd.
(c)
*
Associated company
Wing Tai Properties
Limited
(d)
Principal activities
Equity held
by the Group
2013
2012
%
%
Joint venture companies
WING TAI ANNUAL REPORT 2013
*
113
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
35.
COMPANIES IN THE GROUP (continued)
Name of companies
(d)
Country of
incorporation/
place of business
Principal activities
Equity held
by the Group
2013
2012
%
%
Joint venture companies (continued)
G2000 Apparel (S) Pte Ltd
*
Singapore
Retailing of garments
45
45
Uniqlo (Singapore) Pte. Ltd.
*, ~
Singapore
Retailing of garments
49
49
Uniqlo (Malaysia) Sdn. Bhd.
*, !
Malaysia
Retailing of garments
27.4
27.5
Optima Investment
& Development Pte. Ltd.
*, &
Singapore
Real estate
40
40
Kualiti Gold Sdn Bhd
*, !
Malaysia
Property investment
30.4
30.5
Wingcrown Investment
Pte. Ltd.
*
Singapore
Property investment
and development
40
—
*
Held by Group companies.
!
Audited by Ernst and Young, Malaysia.
# These companies are not required to be audited by law in the country of incorporation.
% Audited by PricewaterhouseCoopers, Hong Kong.
& Audited by KPMG LLP, Singapore.
^
Audited by Deloitte & Touche LLP, Singapore.
~
Audited by Ernst and Young LLP, Singapore.
> Audited by RSM, China.
In accordance to Rule 716 of the Singapore Exchange Securities Trading Limited – Listing Rules, the
Audit Committee and the Board of Directors of the Company conﬁrmed that they are satisﬁed that
the appointment of different auditors for its signiﬁcant subsidiary and associated companies would not
compromise the standard and effectiveness of the audit of the Company.
WING TAI ANNUAL REPORT 2013
114
Notes to the Financial Statements
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
36. NEW OR REVISED ACCOUNTING STANDARDS AND INTERPRETATIONS
Below are the mandatory standards and amendments to existing standards that have been published, and are
relevant for the Group’s accounting periods beginning on or after 1 July 2013 or later periods and which the Group
has not early adopted:
FRS 113 Fair Value Measurement (effective for annual periods beginning on or after 1 January 2013)
FRS 113 provides consistent guidance across FRSs on how fair value should be determined and which disclosures
should be made in the ﬁnancial statements. The Group has yet to assess the full impact of FRS 113 and intends to
adopt the standard from 1 July 2013.
37.
AUTHORISATION OF FINANCIAL STATEMENTS
These ﬁnancial statements have been authorised for issue in accordance with a resolution of the Board of Directors
on 12 September 2013.
WING TAI ANNUAL REPORT 2013
115
Shareholding Statistics
AS AT 12 SEPTEMBER 2013
SHARE CAPITAL
No. of Issued Shares:
No. of Issued Shares (excluding Treasury Shares):
No./percentage of Treasury Shares:
Class of Shares:
Voting Rights (excluding Treasury Shares):
793,927,260
785,020,860
8,906,400 (1.13%)
Ordinary Shares
1 vote per share
DISTRIBUTION OF SHAREHOLDERS
Size of Shareholdings
No. of Shareholders
%
No. of Shares
%
662
8,755
2,055
26
5.76
76.14
17.87
0.23
246,664
35,179,908
75,627,146
673,967,142
0.03
4.48
9.64
85.85
11,498
100.00
785,020,860
100.00
No. of Shares
%
222,235,490
73,589,316
72,717,436
70,492,048
65,465,322
41,550,132
28,308,549
21,332,699
14,853,890
13,625,708
12,119,572
5,181,552
5,040,209
4,329,715
4,208,409
3,529,166
2,319,550
2,106,000
1,835,739
1,750,000
28.31
9.37
9.26
8.98
8.34
5.29
3.61
2.72
1.89
1.74
1.54
0.66
0.64
0.55
0.54
0.45
0.30
0.27
0.23
0.22
666,590,502
84.91
1 to 999
1,000 to 10,000
10,001 to 1,000,000
1,000,001 and above
Total
TWENTY LARGEST SHAREHOLDERS
Name
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Wing Sun Development Private Limited
DBS Vickers Securities (Singapore) Pte Ltd
Winlyn Investment Pte Ltd
Citibank Nominees Singapore Pte Ltd
DBS Nominees Pte Ltd
HSBC (Singapore) Nominees Pte Ltd
DBSN Services Pte Ltd
UOB Kay Hian Pte Ltd
United Overseas Bank Nominees Pte Ltd
Rafﬂes Nominees (Pte) Ltd
Empire Gate Holdings Limited
Morgan Stanley Asia (Singapore) Securities Pte Ltd
DB Nominees (S) Pte Ltd
OCBC Nominees Singapore Pte Ltd
Liu Hing Yuen Patricia @ Liu Pui Yuk
Winway Investment Pte Ltd
Maybank Kim Eng Securities Pte Ltd
Ng Bee Har
CIMB Securities (Singapore) Pte Ltd
Paramount Assets Investments Pte Ltd
Total
PERCENTAGE OF SHAREHOLDING HELD IN THE HANDS OF PUBLIC
As at 12 September 2013, approximately 49.01% of the issued ordinary shares of the Company are held by the public.
Rule 723 of the Listing Manual of the Singapore Exchange Securities Trading Limited has accordingly been complied with.
WING TAI ANNUAL REPORT 2013
116
Shareholding Statistics
AS AT 12 SEPTEMBER 2013
SUBSTANTIAL SHAREHOLDERS AS SHOWN IN THE REGISTER OF SUBSTANTIAL SHAREHOLDERS
Name
Interest (No. of Ordinary Shares)
Cheng Wai Keung
Edmund Cheng Wai Wing
Christopher Cheng Wai Chee
Edward Cheng Wai Sun
Deutsche Bank International Trust Co. (Cayman) Limited
Deutsche Bank International Trust Co. Limited
Wing Sun Development Private Limited
Wing Tai Asia Holdings Limited
Winlyn Investment Pte Ltd
Terebene Holdings Inc
Metro Champion Limited
Ascend Capital Limited
395,038,656 1
310,601,6642
307,207,2483
307,072,4983
307,072,4983
307,072,4983
222,235,490
234,355,0624
72,717,436
72,717,4365
72,717,4366
68,207,092
1
Includes 395,038,656 shares beneﬁcially owned by Wing Sun Development Private Limited, Winlyn Investment
Pte Ltd, Winway Investment Pte Ltd, Empire Gate Holdings Limited, Wilma Enterprises Limited and Ascend
Capital Limited.
2
Includes 310,601,664 shares beneﬁcially owned by Wing Sun Development Private Limited, Winlyn Investment
Pte Ltd, Winway Investment Pte Ltd and Empire Gate Holdings Limited.
3
Includes 307,072,498 shares beneﬁcially owned by Wing Sun Development Private Limited, Winlyn Investment
Pte Ltd and Empire Gate Holdings Limited.
4
Includes 234,355,062 shares beneﬁcially owned by Wing Sun Development Private Limited and Empire Gate
Holdings Limited.
5
Shares beneﬁcially owned by Winlyn Investment Pte Ltd in which Terebene Holdings Inc is deemed to have
an interest.
6
Shares beneﬁcially owned by Winlyn Investment Pte Ltd in which Metro Champion Limited is deemed to have
an interest.
WING TAI ANNUAL REPORT 2013
Today, Wing Tai has a
balanced and diversiﬁed
portfolio of residential,
commercial and hospitality
properties in Singapore,
Malaysia, Hong Kong
and China. Its other core
business is in fashion and
lifestyle retail, in which it
manages over 240 stores
in Singapore and Malaysia.
Contents
The pioneering
founders and their
supportive families.
01
CHAIRMAN’S MESSAGE
03
PROPERTY
06
HOSPITALITY
07
RETAIL
08
CORPORATE DATA
09
BOARD OF DIRECTORS
12
KEY MANAGEMENT
13
CORPORATE GOVERNANCE
20
CALENDAR OF EVENTS
21
FINANCIAL REPORTS
Singapore’s first
Finance Minister the
late Dr Goh Keng Swee
officiated the opening
of Wing Tai’s first
factory in Singapore
on 18 September
1963. Wing Tai was
granted pioneer
status and by 1989,
it had 20 factories in
Singapore, Malaysia,
Hong Kong, Tunisia,
China, Myanmar and
Sri Lanka.
The Giverny, Hong Kong
The front cover shows the Tembusu, a handsome
and distinctive native tree, noted for its deep roots
and extensive branch system. Its deep-grained bark
conveys character and tenacity, while its fragrant
ﬂowers offer inﬁnite delight. The Tembusu is an
inspiration which guides Wing Tai’s vision and
values; it stands as an enduring symbol of integrity
and resilience — a ﬁtting corporate logo for Wing
Tai as it sets sights on steady and conﬁdent growth.
Lanson Place Hotel, Hong Kong
Wing Tai believes in giving back
and caring for the society. It is also
committed to building trust and
long-term relationships with its
partners and staff.
Helios Residences, Singapore
Belle Vue Residences, Singapore
Early senior staff posing for a
photograph at the gate of the ﬁrst factory
at Little Road on its Opening Day in 1963.
The Meritz, Malaysia
Moving in tandem with the
transformation growth of the
Singapore economy, the company
ceased operations in garment
manufacturing in 1996 and
expanded its business in property
in 1978 and fashion retail in 1984.
With its exciting portfolio of retail brands,
Wing Tai holds itself to a high standard in
customer centricity to achieve service excellence.
The 10-storey building at 107 Tampines
Road was the tallest building in the
neighbourhood. The adjacent factory at
No. 105 was subsequently rebuilt as a ninestorey facility.
Adolfo Dominguez, Singapore
The Lakeside, China
WING TAI HOLDINGS LIMITED
Annual Report 2013
OUR WINNING PARTNERSHIPS
50 TH ANNIVERSARY
ANNUAL REPORT 2013