Dairy Farm International Holdings (DFI) 2011年年度報告「LSE」.pdf

《Dairy Farm International Holdings (DFI) 2011年年度報告「LSE」.pdf》由會員分享，可在線閱讀，更多相關《Dairy Farm International Holdings (DFI) 2011年年度報告「LSE」.pdf（68頁珍藏版）》請在三個皮匠報告上搜索。

1、Dairy Farm International Holdings LimitedAnnual Report 2011C O N T E N T SInternet website: 1 Corporate Information 2 Corporate Overview 3 Highlights 4 Chairmans Statement 6 Group Chief Executives Review 10 Financial Review 12 Directors Profiles 13 Financial Statements 53 Independent Auditors Report

2、 54 Five Year Summary 55 Responsibility Statement 56 Corporate Governance61 Principal Risks and Uncertainties 62 Shareholder Information 63 Retail Outlets Summary 64 Management and OfficesAnnual report cover designed by Business with Design Management students,IVE(LWL):Chan Mei Wa,Law Wai Fung,Lee H

3、iu Tung,Shek Ka Ho and Wong Ching Pat.Dairy Farm International Holdings Limited Annual Report 20111CORPORATE INFORMATIONDIRECTORSSimon KeSwicKChairmanBen KeSwicKManaging Directormichael KoKGroup Chief ExecutiveRonald J.FlotomaRK GReenBeRGGeoRGe J.hoadam KeSwicKSiR henRy KeSwicKdR GeoRGe c.G.KooloRd

4、leach oF FaiRFoRda.J.l.niGhtinGaleJameS Rileyalec tonGPeRcy weatheRallGileS whiteCOMPANY SECRETARY AND REGISTERED OFFICEJohn c.lanGJardine House33-35 Reid StreetHamiltonBermudaDAIRY FARM MANAGEMENT SERVICES LIMITEDDIRECTORSBen KeSwicKChairmanmichael KoKGroup Chief Executivealec tonGGroup Finance Dir

5、ectordato John coyleRegional Director,East AsiacaRoline maKRegional Director,North AsiaPoh SenG PolGroup Business Development Directoralex tayRegional Director,South Asiamichael wuChairman and Managing Director,MaximsmaRK GReenBeRGadam KeSwicKJameS RileyGileS whiteCORPORATE SECRETARYn.m.mcnamaRaDair

6、y Farm International Holdings LimitedDairy Farm is a leading pan-Asian retailer.At 31st December 2011,the Group and its associates operated over 5,400 outlets;employed over 85,000 people and had total annual sales exceeding US$10 billion.The Group operates supermarkets,hypermarkets,health and beauty

7、 stores,convenience stores and home furnishings stores under well-known local brands,including:SupermarketsWellcomeinHongKong,TaiwanandVietnam,ThreeSixty and Olivers The Delicatessen in Hong Kong,Jasons MarketPlace in Singapore,Hong Kong and Taiwan,Cold Storage in Singapore and Malaysia,Giant in Mal

8、aysia,Indonesia and Brunei,Shop N Save in Singapore,Hero in Indonesia,and Foodworld in India;HypermarketsGiantinMalaysia,Indonesia,Singapore,BruneiandVietnam;HealthandbeautystoresManningsinHongKong,mainlandChinaand Macau,Guardian in Malaysia,Singapore,Indonesia,Brunei and Vietnam,and Health and Glow

9、 in India;Conveniencestores7-EleveninHongKong,Singapore,SouthernChina and Macau,and Starmart in Indonesia;andHomefurnishingsstoresIKEAinHongKongandTaiwan.The Group has a 50%interest in Maxims,Hong Kongs leading restaurant chain.Dairy Farm International Holdings Limited is incorporated in Bermuda and

10、 has a premium listing on the London Stock Exchange,with secondary listings in Bermuda and Singapore.The Groups businesses are managed from Hong Kong by Dairy Farm Management Services Limited through its regional offices.Dairy Farm is a member of the Jardine Matheson Group.Dairy Farm International H

11、oldings Limited Annual Report 20112HigH-Quality,low-Cost RetailingDairy Farm aims to be a leader in all its market sectors.Our focus is retailing and we strive to offer consumers value-for-money through efficient,low-cost distribution of high-quality fresh foods,and consumer and durable goods in our

12、 supermarkets,hypermarkets,health and beauty stores,convenience stores and home furnishings stores.asia FoCusWe are geographically committed to Asia.In addition to developing our existing operations,we aim to achieve growth by exploring new investment opportunities within the region.Multiple FoRMats

13、,sHaRed seRviCesWe operate multiple formats in most markets and achieve economies of scale by supporting these with shared infrastructure for logistics,human resources,finance,procurement,and information technology systems.long-teRM sHaReHoldeR value CReationWe aim to maintain financial strength thr

14、ough prudent balance sheet management.We take a long-term view of business development and believe in striking a balance between investment in mature cash-flow activities and investment in new businesses.Shareholder value creation is the performance yardstick for the long-term incentive programme of

15、 the Companys management.Corporate Overview“Our goal is to satisfy the appetites of Asian shoppers for wholesome food and quality consumer and durable goods at competitive prices.”Dairy Farm International Holdings Limited Annual Report 20113Highlights Underlyingearningsup16%Profitgrowthinallregions

16、Maximsperformingwell ContinuedinvestmentinbusinessexpansionResults2011US$m2010US$mChange%Sales subsidiaries9,1347,97115includingassociates10,4499,11315Underlying profit attributable to shareholders47441016Non-trading items101n/aProfit attributable to shareholders48441118USUS%Underlying earnings per

17、share 35.0930.3816Basic earnings per share 35.8730.5018Dividends per share21.0018.0017Dairy Farm International Holdings Limited Annual Report 20114Chairmans Statement264North AsiaSouth AsiaEast AsiaUS$bTotal Sales0121082009 2010 201120082007MaximsoveRviewStable trading environments in Dairy Farms ma

18、jor markets across Asia led to strong sales and profit growth in 2011.peRFoRManCeSales,including 100%of associates,increased by 15%to US$10.4 billion in 2011,while underlying profit at US$474millionwasup16%.Foreigncurrency movements enhanced both sales and profit by 4%during the year.Underlying earn

19、ings per share were US35.09,anincreaseof16%.Theprofitattributable to shareholders of US$484 million included a non-trading gain of US$10 million,being the Groups share of profit arising from the disposal by Maxims of its remaining interest in Starbucks in mainland China.There was an excellent perfor

20、mance from the Groups operations in North Asia with profit growth exceeding that of sales.Mannings health and beauty stores produced another strong result in Hong Kong,while IKEA traded well in both Hong Kong and Taiwan.In East Asia,most businesses performed well with fine results from the Guardian

21、health and beauty chain in Malaysia and from hypermarkets and supermarkets in Indonesia.A steady trading performance was seen in South Asia.Our restaurant associate,Maxims,also made an increased contribution despite facing higher food and wage costs.The Groups financial position remains healthy with

22、 good cash generation.Net cash at the end of 2011 was US$466million,representinganincreaseof US$243 million during the year.Capital expenditure incurred in growing the store network and in refurbishing existing outlets amounted to US$232 million.The Board is recommending a final dividend of US15.00

23、per share,bringing the total ordinary dividend for 2011 to US21.00pershare,up17%.Business developMentsDairy Farm continued to generate profitable growth during 2011 as good increases in comparable store sales were complemented by further organic expansion from new store openings.There was some impac

24、t from food inflation and higher staff costs,particularly in Hong Kong following the introduction of a minimum wage.In the more mature markets of Hong Kong,Singapore and Taiwan,the Group is concentrating on improving operational efficiencies and enhancing store attractiveness,while in Indonesia and

25、Malaysia significant funds are being invested in enlarging the store network of existing formats.New areas of activity include the first Giant hypermarket and the first five Guardian health and beauty stores in Vietnam,which were opened towards Dairy Farm International Holdings Limited Annual Report

26、 20115Chairmans Statement510152009 2010 201120082007USUnderlying EarningsPer Share030352520the end of the year.Expansion of the Mannings health and beauty store network in mainland China also continues.In February 2012,the Group agreedtoacquirea70%equityinterestin a supermarket chain in Cambodia,wit

27、h the local joint venture partner retaining 30%.This venture creates a good platform for growth in this developing economy,and increases to 11 the number of territories in Asia in which the Group is active.Maxims introduced further new restaurant concepts in Hong Kong in 2011,while maintaining the g

28、rowth of its Starbucks and Japanese restaurant chains.It has also increased its activities in mainland China.In May,Maxims restructured its Starbucks business interests in conjunction with the franchisor,selling its 30%interest in the Starbucks operations in mainland China and acquiring full ownersh

29、ip of the Hong Kong and Macau operations.Dairy Farm is continuing to invest in the modernization and standardization of its retail business processes and systems across its operations.During the year the Group successfully implemented SAP merchandising systems in Indonesia,following a similar introd

30、uction in Malaysia in 2010.Improvements are also being made in supply chain management,while the expansion is ongoing of its private label products offering value-for-money alternatives to customers.peopleThe achievement of another year of good results is a reflection of the hard work and dedication

31、 of all our employees.On behalf of the Board,I would like to thank them for their efforts and wish them well in the year ahead.R.C.Kwok retired from the Board on 12th May 2011.Anthony Nightingale will step down as Managing Director at the end of March 2012,and will remain as a non-executive Director

32、.On behalf of the Board,I would like to thank them for their significant contributions to the Group.Joining the Board on 1st April 2012 will be Ben Keswick as Managing Director and Adam Keswick as a Director.pRospeCtsWhile the global economic outlook remains uncertain,Dairy Farms market leading busi

33、nesses are generally trading well.With its strong financial position,the Group is well placed to secure further development opportunities.Simon KeSwicK Chairman1st March 2012Dairy Farm International Holdings Limited Annual Report 20116Group Chief Executives Review2009 2010 201120082007US$mUnderlying

34、 Net Profit050100150200250300350400500450Business ModelDairy Farm is a leading retailer in Asia operating supermarkets,hypermarkets,health and beauty stores,convenience stores and home furnishings stores under well-known local brands.We operate multi-formats in most markets to cater for different ma

35、rket segments and customer needs.The Group also has a 50%interest in Maxims,a leading restaurant group in Hong Kong.In addition to developing our existing operations,the Groups strategy is to expand by seeking investment opportunities in current and new markets in Asia.The Group has holdings in matu

36、re cash generating operations in developed markets which it complements with investments in new ventures and markets,thereby spreading the risk that might otherwise be associated with its geographical concentration.This strategy combined with a strong balance sheet is designed to achieve long-term e

37、arnings growth.2011 peRFoRManCeDairy Farm delivered another year of strong results in 2011 with increased sales and earnings in each of our operating regions.We continue to introduce new concepts and implement initiatives to enhance our operating efficiencies and make our stores more attractive.A nu

38、mber of important developments occurred during the year:Incontinuingoperations,weadded a net 141 stores to reach a total of 5,406.InTaiwan,wesecuredasiteinTaiChung for a fifth IKEA store,and the project is progressing well for completion in 2013.InmainlandChina,wecontinuedtoexpand our Mannings healt

39、h and beautybusiness,whichnowhas195outlets.InMalaysia,weopenedsevennewGiant hypermarkets,bringing the total to71stores.InIndonesia,wehavepassedthe 500-store milestone in the country.InVietnam,ourfirsthypermarketandthe first five Guardian health and beauty stores were opened.Ourrestaurantassociate,Ma

40、xims,restructured its Starbucks business in conjunction with the franchisor by selling its 30%interests in mainland China and acquiring the outstanding interests in the Hong Kong and Macau franchise.SAPmerchandisingsystemshavebeensuccessfully implemented in Indonesia,following their implementation i

41、n Malaysia in 2010.Dairy Farm International Holdings Limited Annual Report 20117Group Chief Executives ReviewWeincreasedfurthertheinvestmentin private label development and supply chain management and are delivering additional value from these important areas.Regional ReviewNORTH ASIAHong KongThe bu

42、sinesses in Hong Kong performed well with profit growth in all banners.Wellcome supermarkets achieved a good result,especially in the second half of the year,and the 7-Eleven convenience stores recorded higher sales and profit in a challenging market segment.Mannings health and beauty stores had ano

43、ther excellent year.The first pharmacist App available on the iPhone was launched,providing video calling real-time professional advice to customers.We now have six Mannings Plus stores offering free health consultation services.IKEA had another fine year as the MegaBox store at Kowloon Bay continue

44、d the good trading results achieved since its opening in June 2010.Maxims performed well in 2011 as the negative effects of increases in food costs and the introduction of a statutory minimum wage in Hong Kong were mitigated by strong sales growth.Its Chinese restaurants delivered a good performance

45、,while Starbucks and the Japanese restaurant chains produced excellent results.Maxims also achieved another year of record sales of mooncakes,assisted by increased demand in the Mainland market.MacauDespite their relatively small size,both 7-Eleven and Mannings in Macau achieved good improvements in

46、 sales and earnings.Mainland China7-Eleven Southern Chinas focus on growing its ready-to-eat food business has led to improved sales and margins.Mannings achieved a further increase in sales as it continues to pursue its development plan.Maxims opened its first Chinese restaurants in Shanghai and Gu

47、angzhou,and added three Genki Sushi outlets in Shenzhen and Guangzhou.It increased its market penetration in Southern China with the number of its cake shops now standing at 100 stores.TaiwanWellcome supermarkets made steady progress in a competitive market.It operated 280 outlets at the end of 2011

48、,and further investment is being made in store refurbishment to enhance their attractiveness.IKEA achieved another year of good sales and profit growth,and secured a site in Tai Chung for a fifth store which is expected to open in late 2013.Dairy Farm International Holdings Limited Annual Report 201

49、18Group Chief Executives ReviewSOUTH ASIASingaporeCold Storage supermarkets performed well in 2011 and achieved higher sales and profit.Shop N Save faced challenges with keen competition,although sales improved in the latter part of the year following the remodelling of its stores.The Giant hypermar

50、kets made further progress with increased sales and profit.7-Eleven performed satisfactorily and endedtheyearwith561stores,whileGuardian achieved good growth in both sales and profit in a competitive segment.IndiaFoodworld supermarkets continued to make progress as higher turnover and reduced operat

51、ing costs led to lower losses.New stores were opened in 2011 with encouraging results.Health and Glow achieved increases in both sales and profit from its health and beauty stores,and its growth momentum bodes well for the future.EAST ASIAMalaysiaIn Malaysia,the Giant and Cold Storage hypermarket an

52、d supermarket operations produced satisfactory results despite increasing levels of competition and customers remaining cautious with their discretionary spending.Seven Giant hypermarkets were opened during the year with another six sites secured for 2012.Guardian,the countrys leading health and bea

53、uty chain,had another excellent year with new stores enhancing the good comparable store sales growth.BruneiGiant hypermarket and supermarket operations in Brunei suffered a decline in sales in a difficult market,while the Guardian chain performed satisfactorily.IndonesiaThe Giant and Hero hypermark

54、et and supermarket operations in Indonesia showed further improvements in performance.Sales growth and tight cost controls at the store level led to good increases in earnings.Guardian and Starmart also recorded satisfactory sales and profit growth.The expansion programme will continue in 2012 with

55、seven sites already secured for the opening of new hypermarkets.VietnamThe first Giant hypermarket was opened in December 2011,and the first five Guardian health and beauty stores were opened during the year.We continue to pursue suitable sites for the expansion of our multi-format operations.tHe ye

56、aR aHeadWith the European debt issues and a sluggish US economy,the global economic environment remains uncertain.This will inevitably have some effect on the Asian region.We are also seeing food inflation as well as rising rental,wage and utilities costs in many Dairy Farm International Holdings Li

57、mited Annual Report 20119Group Chief Executives ReviewOrdinary DividendsPer ShareInterim dividendFinal dividendUS2009 2010 2011200820070246810121416182022countries in which we operate.Despite these increasingly challenging conditions,our established market leading positions should allow us to perfor

58、m well in the year ahead.In early 2012,we entered a new Asian marketwiththeacquisitionofa70%interest in a supermarket chain in Cambodia.This joint venture with the local partner offers good opportunities for growth.Dairy Farm will continue to grow its retailing formats in existing markets and seek a

59、cquisition opportunities.These developments will be supported by enhanced supply chain and IT systems that will deliver added value.Substantial capital has also been earmarked for the expansion of our hypermarkets and supermarkets in Indonesia and Malaysia,as well as for the refurbishment of existin

60、g stores.Overall,our net growth in the number of stores for this year is expected to be higher than in 2011.Our achievements in 2011 were the result of the hard work and commitment of our people.I wish to thank them sincerely for their great efforts that are fundamental to the Groups success.michael

61、 KoKGroup Chief Executive1st March 2012Dairy Farm International Holdings Limited Annual Report 201110Financial ReviewEast Asia(57%)South Asia(17%)North Asia(26%)Total:US$243mBy regionBy format2011 Capital ExpenditureSupermarkets(30%)Convenience stores(7%)Health andbeauty stores(13%)Hypermarkets(37%)

62、IT/Distribution centres(9%)IKEA(4%)aCCounting poliCiesThe Directors continue to review the appropriateness of the accounting policies adopted by the Group having regard to developments in International Financial Reporting Standards.In 2011,a number of amendments to these standards became effective a

63、nd the Group adopted those which are relevant to the Groups operations.As mentioned in note 1 to the financial statements,their adoption does not have a material impact on the Groups accounting policies.ResultsSales,excluding those of associates,were US$9,134million,a15%increaseover2010.Operating pr

64、ofit before interest and tax(PBIT)was US$535 million,anincreaseofUS$66millionovertheprevious year,maintaining the PBIT to salesratioat5.9%.Afterincluding the Groups share of results of associates,underlying net profit was US$474million.Thisrepresentsa16%increase over 2010.In addition,there was a non

65、-trading gain of US$10 million in 2011,being the Groups share of profit arising from the disposal by Maxims of its remaining interest in Starbucks in mainland China.Thetaxchargefor2011wasUS$99million,compared to US$84 million in 2010,reflecting the Groups improved profitability in its major markets.

66、Underlying earnings per share were US35.09,anincreaseof16%overtheprevious year.CasH FlowOperating cash flow remained strong withanetinflowofUS$730million,compared to the previous years US$677million.Theincreasewasmainlydue to higher profit from operations and good working capital management.As a res

67、ult,the Group ended the year with netcashofUS$466million,anincreaseof US$243 million from 2010 year end.Capital expenditure was US$243 million,comparedtoUS$276millionin2010.Incontinuing operations,the Group,including associates,added 141 outlets in 2011.BalanCe sHeetTotal assets,excluding cash and b

68、ank balances,ofUS$2,809millionwereUS$233 million higher than 2010,mainly reflecting the investment in new and refurbished stores and the associated increase in the level of stock.Net operatingassetswereUS$930millionattheendof2011,a27%increaseovertheprevious year.Dairy Farm International Holdings Lim

69、ited Annual Report 201111Financial Review2009 2010 201120082007USOperating Cash Flow Per Share0102030405060dividendThe Board is recommending a final dividend of US15.00 per share.This will bring the total dividend in respect of 2011 to US21.00 per share,an increase of17%over2010andapayoutofapproxima

70、tely 60%of the yearsunderlying profit.FinanCingBorrowings are normally taken out in local currencies by the Groups operating subsidiaries to fund and partially hedge their local asset investments.The Group,excluding associates,had gross debt ofUS$264millionattheyearend,adecreaseofUS$195million.Commi

71、ttedbanking facilities at the year end totalled US$548 million,and had an average life to maturity of 1.5 years.Financing income increased slightly to US$4 million,while financing charges decreased from US$26millionin2010toUS$21millionin 2011.FinanCial RisK ManageMentA comprehensive discussion of th

72、e Groups financial risk management policies is included in note 2 to the financial statements.The Group manages its exposure to financial risk using a variety of techniques and instruments.The main objectives are to limit exchange and interest rate risks and to provide a degree of certainty about co

73、sts.As a matter of policy,the Group does not enter into speculative transactions in derivatives.The investment of the Groups cash resources is managed so as to minimize risk while seeking to enhance yield.Overall,the Groups funding arrangements are designed to keep an appropriate balance between equ

74、ity and debt,both short and long term,to give flexibility for the development of the business.At the year end,US$138 million of gross debt was subject to fixed interest rates,with a remaining average tenor of nine months.pRinCipal RisKs and unCeRtaintiesA review of the principal risks and uncertaint

75、ies facing the Group is set out onpage61.alec tonG Group Finance Director1st March 2012Dairy Farm International Holdings Limited Annual Report 201112Directors ProfilesSimon KeswickChairmanMr Simon Keswick joined the Board and becameChairmanin1986.HejoinedtheJardineMathesongroupin1962andisalso chairm

76、an of Hongkong Land and Mandarin Oriental,and a director of Jardine Lloyd Thompson,Jardine Matheson and Jardine Strategic.Ben Keswick*Managing DirectorMr Ben Keswick joined the Board as Managing Director in April 2012.He has held a number of executive positions since joining the Jardine Matheson gro

77、upin1998,includingfinancedirectorand then chief executive officer of JardinePacificbetween2003and2007and,thereafter,group managing director of Jardine Cycle&Carriage until March 2012.He has an MBA from INSEAD.Mr Keswick is chairman of Jardine Matheson Limited and Jardine Cycle&Carriage,and a commiss

78、ioner of Astra and United Tractors.He is also managing director of Hongkong Land,Jardine Matheson,Jardine Strategic and Mandarin Oriental,and a director of Jardine Pacific and Jardine Motors.Michael Kok*Group Chief ExecutiveMr Kok joined the Board and was appointed Group Chief Executive in 2007.Hejo

79、inedDairyFarmin1987andhas extensive experience in the retail industry in Asia.As a director of Dairy FarmManagementServicessince1997,he had prime responsibility for the Groups retail businesses in South and East Asia.Alec Tong*Group Finance DirectorMr Tong joined the Board as Group Finance Director

80、in 2010.He has been with the Jardine Matheson group since 1993duringwhichtimehehasheldanumber of senior finance positions,including finance director of Jardine Pacific and Jardine Motors.Mr Tong is a Chartered Accountant.Ronald J.FlotoMrFlotojoinedtheBoardin1997andwas Group Chief Executive until he

81、retiredfromexecutiveofficein2007.Hisextensive experience in the retail industry included senior positions in Kmart Corporation and Super Kmart in the United States.Mark GreenbergMrGreenbergjoinedtheBoardin2006.He is group strategy director of Jardine Matheson.Hehadpreviouslyspent16years in investmen

82、t banking with Dresdner Kleinwort Wasserstein in London.He is also a director of Jardine Matheson Limited,Hongkong Land,Jardine Cycle&Carriage and Mandarin Oriental,and a commissioner of Astra and Bank Permata.George J.Ho MrHojoinedtheBoardin1998.Hewaspreviously engaged in private law practice in Sa

83、n Francisco and is currently engaged in the broadcasting and multi-media industries.Mr Ho is also chairman of Hong Kong Commercial Broadcasting Company.Adam KeswickMr Adam Keswick joined the Board in April 2012.He is deputy managing director of Jardine Matheson,chairman of Jardine Pacific,and chairm

84、an and chief executive of Jardine Motors.He has held a number of executive positions since joining the Jardine Matheson group from N M Rothschild&Sons in 2001,including group strategy director and,thereafter,group managing director of Jardine Cycle&Carriage between 2003and2007.MrKeswickisalsodeputy

85、chairman of Jardine Matheson Limited,and a director of Hongkong Land,Jardine Strategic,Mandarin Oriental and Rothschilds Continuation.Sir Henry Keswick SirHenryjoinedtheBoardin1988.Heis chairman of Jardine Matheson,having first joined the Jardine Matheson group in1961,andisalsochairmanofJardineStrat

86、egic.He is a director of Hongkong Land and Mandarin Oriental.He is also vice chairman of the Hong Kong Association.Dr George C.G.KooDr Koo,a Fellow of the Royal College of Surgeons,was appointed as a Director in1990.Heisthefounderandmanagingdirector of the Hong Kong Lithotripter Centre.He is also a

87、director of Jardine Strategic.Lord Leach of FairfordLordLeachjoinedtheBoardin1987.Heis deputy chairman of Jardine Lloyd Thompson,and a director of Hongkong Land,Jardine Matheson,Jardine Strategic,Mandarin Oriental and Rothschilds Continuation.He joined the JardineMathesongroupin1983afteracareer in b

88、anking and merchant banking.A.J.L.NightingaleMrNightingalejoinedtheBoardin2006and was Managing Director of the Companyfrom2006toMarch2012.Heheld a number of senior positions since first joining the Jardine Matheson group in1969untilhisretirementfromexecutive office in March 2012.He is also a directo

89、r of Hongkong Land,Jardine Cycle&Carriage,Jardine Matheson,Jardine Strategic and Mandarin Oriental,and a commissioner of Astra.Mr Nightingale is also a member of the Commission on Strategic Development,a member of the Committee on Strategic Enhancement of Hong Kong as an International Financial Cent

90、re,a vice president of The Real Estate Developers Association of Hong Kong,a council member of the Employers Federation of Hong Kong,a Hong Kong representative to the APEC Business Advisory Council,a member of Chongqing Mayors International Economic Advisory Council and a member of the UK ASEAN Busi

91、ness Council Advisory Panel.He is also chairman of The Sailors Home and Missions to Seamen in Hong Kong.James RileyMr Riley joined the Board in 2005.He is group finance director of Jardine Matheson.A Chartered Accountant,he joined the Jardine Matheson group from KleinwortBensonin1993.Hewasappointed

92、chief financial officer of Jardine Cycle&Carriagein1994,andfrom1999to2005hewasresponsiblefor the businesses grouped under Jardine Pacific.He is also a director of Jardine Matheson Limited and The Hongkong and Shanghai Banking Corporation.Percy WeatherallMr Weatherall joined the Board in 2000 and was

93、 Managing Director from 2000 to2006.HefirstjoinedtheJardineMathesongroupin1976andretiredfromexecutiveofficein2006.Heisalsoa director of Hongkong Land,Jardine Matheson,Jardine Strategic and Mandarin Oriental.He is chairman of Corney and Barrow.Giles WhiteMrWhitejoinedtheBoardin2009.Heis the Jardine M

94、atheson group general counsel.He was previously Asia managing partner of Linklaters based in Hong Kong,prior to which he was the firms head of global finance and projects in London.Mr White is also a director of Jardine Matheson Limited,Jardine Matheson and Mandarin Oriental.*Executive Director 1st

95、April 2012Dairy Farm International Holdings Limited Annual Report 20111320112010NoteUnderlyingbusinessperformanceUS$mNon-tradingitemsUS$mTotalUS$mUnderlyingbusinessperformanceUS$mNon-tradingitemsUS$mTotalUS$mSales 49,134.49,134.4 7,970.57,970.5Cost of sales(6,451.9)(6,451.9)(5,595.5)(5,595.5)Gross m

96、argin 2,682.5 2,682.5 2,375.02,375.0Other operating income 132.9 132.9 120.4 0.3 120.7Selling and distribution costs(1,971.4)(1,971.4)(1,755.2)(1,755.2)Administration and other operating expenses(308.7)(308.7)(270.5)(0.7)(271.2)Operating profit 5 535.3 535.3 469.7(0.4)469.3Financing charges (21.1)(2

97、1.1)(25.5)(25.5)Financing income 3.6 3.6 2.92.9Net financing charges 6 (17.5)(17.5)(22.6)(22.6)Share of results of associates and joint ventures 7 55.6 10.5 66.1 47.147.1Profit before tax 573.4 10.5 583.9 494.2(0.4)493.8Tax 8(99.3)(99.3)(85.5)2.0 (83.5)Profit after tax 474.1 10.5 484.6 408.71.6 410.

98、3 Attributable to:Shareholders of the Company 9 473.8 10.5 484.3 409.81.6 411.4 Non-controlling interests 0.3 0.3 (1.1)(1.1)474.1 10.5 484.6 408.71.6 410.3 US US US USEarnings per share 9basic 35.09 35.87 30.38 30.50 diluted 35.05 35.83 30.34 30.46Consolidated Profit and Loss Account for the year en

99、ded 31st December 2011 Dairy Farm International Holdings Limited Annual Report 201114Note2011US$m2010US$mProfit for the year484.6410.3Revaluation of other investments gainsarisingduringtheyear140.70.2Net actuarial loss on employee benefit plans(33.4)(5.2)Net exchange translation differences(losses)/

100、gainsarisingduringtheyear(17.0)13.6Cash flow hedges netgainarisingduringtheyear5.62.6Share of other comprehensive expense of associates and joint ventures 13(1.1)(2.7)Tax relating to components of other comprehensive income or expense 85.00.2Other comprehensive(expense)/income for the year(40.2)8.7T

101、otal comprehensive income for the year 444.4419.0Attributable to:Shareholders of the Company 444.6420.1Non-controlling interests(0.2)(1.1)444.4419.0Consolidated Statement of Comprehensive Income for the year ended 31st December 2011 Dairy Farm International Holdings Limited Annual Report 201115Conso

102、lidated Balance Sheetat 31st December 2011Note2011US$m2010US$mNet operating assetsIntangible assets11352.4343.9Tangible assets12896.0920.8Associates and joint ventures13193.5160.6Other investments144.03.3Non-current debtors15126.9123.5Deferred tax assets1620.619.2Pension assets170.727.1Non-current a

103、ssets1,594.11,598.4Stocks949.1816.3Current debtors15217.8160.4Current tax assets0.90.9Bank balances and other liquid funds 18729.7681.81,897.51,659.4Non-current assets classified as held for sale1947.4Current assets1,944.91,659.4Current creditors20(2,140.2)(1,869.9)Current borrowings21(130.2)(120.5)

104、Current tax liabilities(80.6)(69.0)Current provisions22(6.2)(5.8)Current liabilities(2,357.2)(2,065.2)Net current liabilities(412.3)(405.8)Long-term borrowings21(133.4)(337.9)Deferred tax liabilities16(43.5)(48.8)Pension liabilities17(36.1)(33.9)Non-current creditors20(16.8)(16.4)Non-current provisi

105、ons22(21.7)(21.4)Non-current liabilities(251.5)(458.4)930.3734.2Total equityShare capital2375.075.0Share premium and capital reserves2550.246.4Revenue and other reserves797.5611.7Shareholders funds922.7733.1Non-controlling interests277.61.1930.3734.2Approved by the Board of Directorsa.J.l.niGhtinGal

106、emichael KoKDirectors1st March 2012Dairy Farm International Holdings Limited Annual Report 201116Attributable to shareholders of the CompanySharecapitalUS$m SharepremiumUS$m CapitalreservesUS$m RevenuereservesUS$m HedgingreservesUS$m ExchangereservesUS$mTotalUS$m Attributableto non-controllingintere

107、stsUS$m TotalequityUS$m 2011At 1st January75.018.028.4617.7(3.6)(2.4)733.11.1734.2Total comprehensive income456.14.7(16.2)444.6(0.2)444.4Dividends paid by the Company(256.5)(256.5)(256.5)Unclaimed dividends forfeited0.50.50.5Issue of shares1.61.61.6Employee share option schemes2.22.22.2Capital contr

108、ibution from non-controlling interests6.76.7Change in interests in associates(2.8)(2.8)(2.8)At 31st December75.019.630.6815.01.1(18.6)922.77.6930.32010At 1st January74.99.926.7436.1(5.5)(16.5)525.6 2.2 527.8Total comprehensive income404.11.914.1420.1(1.1)419.0Dividends paid by the Company(222.5)(222

109、.5)(222.5)Issue of shares0.18.18.28.2Employee share option schemes1.71.71.7At 31st December75.018.028.4617.7(3.6)(2.4)733.11.1734.2Total comprehensive income included in revenue reserves comprises profit attributable to shareholders of the Company of US$484.3 million(2010:US$411.4 million),netfairva

110、luegainonotherinvestmentsofUS$0.6million(2010:US$0.2 million)and net actuarial loss on employee benefit plans of US$28.8 million(2010:US$7.5 million).Cumulative net fair value gain on other investments and net actuarial loss on employee benefit plans amounted to US$3.1 million(2010:US$2.5 million)an

111、d US$21.5 million(2010:net gain US$6.8 million),respectively.Consolidated Statement of Changes in Equityfor the year ended 31st December 2011Dairy Farm International Holdings Limited Annual Report 201117Consolidated Cash Flow Statementfor the year ended 31st December 2011Note2011US$m2010US$mOperatin

112、g activitiesOperating profit 5535.3469.3Depreciation and amortization 29(a)181.4167.3Other non-cash items 29(b)8.36.0Decrease in working capital 29(c)72.6100.5Interest received3.52.9Interest and other financing charges paid(21.7)(25.5)Tax paid(88.3)(73.6)691.1646.9Dividends from associates and joint

113、 ventures39.229.6Cash flows from operating activities730.3676.5Investing activitiesPurchase of tangible assets(213.5)(210.8)Purchase of subsidiaries 29(d)(0.4)(52.2)Purchase of associates and joint ventures(9.9)Purchase of intangible assets(18.7)(13.0)Sale of properties 29(e)37.3Sale of other tangib

114、le assets1.00.8Cash flows from investing activities(241.5)(237.9)Financing activitiesIssue of shares1.68.2Capital contributions from non-controlling interests6.7Drawdown of borrowings1,293.41,480.4Repayment of borrowings(1,492.5)(1,555.5)Dividends paid by the Company 26(256.5)(222.5)Cash flows from

115、financing activities(447.3)(289.4)Net increase in cash and cash equivalents41.5149.2Cash and cash equivalents at 1st January679.9520.8Effect of exchange rate changes(2.7)9.9Cash and cash equivalents at 31st December 29(f)718.7679.9Dairy Farm International Holdings Limited Annual Report 201118Notes t

116、o the Financial Statements1.PRINCIPAL ACCOUNTING POLICIESBasis of preparationThe financial statements have been prepared in accordance with International Financial Reporting Standards,including International Accounting Standards and Interpretations adopted by the International Accounting Standards B

117、oard.The financial statements have been prepared under the historical cost convention except as disclosed in the accounting policies below.Standards,amendments and interpretations effective in 2011 which are relevant to the Groups operationsRevised IAS 24Related Party DisclosuresAmendment to IAS 32C

118、lassification of Rights IssuesAmendments to IFRIC 14Prepayments of a Minimum Funding RequirementIFRIC19Extinguishing Financial Liabilities with Equity InstrumentsImprovements to IFRSs(2010)The adoption of these standards,amendments and interpretations does not have a material impact on the Groups ac

119、counting policies.Revised IAS 24 Related Party Disclosures supersedes IAS 24(as revised in 2003).It simplifies the disclosure requirements for government-related entities and clarifies the definition of a related party.Amendment to IAS 32 Classification of Rights Issues clarifies that rights issues

120、are equity instruments when they are denominated in a currency other than the issuers functional currency and are issued pro-rata to an entitys existing shareholders for a fixed amount of currency.Amendments to IFRIC 14 Prepayments of a Minimum Funding Requirement require an entity to recognize an a

121、sset for a prepayment that will reduce future minimum funding contributions required by the entity.IFRIC19ExtinguishingFinancialLiabilitieswithEquityInstrumentsprovidesguidanceontheapplicationofIAS39and IAS 32 when an entity issues its own equity instruments to extinguish all or part of a financial

122、liability.The Improvements to IFRSs(2010)comprise a number of non-urgent but necessary amendments to IFRSs.The amendments which are relevant to the Groups operations include IFRS 3(amendments)Business Combinations,IFRS7(amendments)FinancialInstruments:Disclosures,IAS1(amendments)PresentationofFinanc

123、ialStatements,IAS 34(amendments)Interim Financial Reporting and IFRIC 13(amendment)Customer Loyalty Programmes.IFRS 3(amendments)Business Combinations clarify the transition requirements for contingent consideration from business combination that occurred before the effective date of the revised IFR

124、S,the measurement of non-controlling interests and un-replaced and voluntarily replaced share-based payment awards.IFRS7(amendments)FinancialInstruments:Disclosuresemphasizetheinteractionbetweenqualitativeandquantitativedisclosures and the nature and extent of risks associated with financial instrum

125、ents.IAS 1(amendments)Presentation of Financial Statements clarify that entities may present the required reconciliations for each component of other comprehensive income either in the statement of changes in equity or in the notes to the financial statements.Dairy Farm International Holdings Limite

126、d Annual Report 201119Notes to the Financial StatementsIAS 34(amendments)Interim Financial Reporting provide guidance to illustrate how to apply disclosure principles in IAS 34 and add disclosure requirements around the circumstances likely to affect fair values of financial instruments and their cl

127、assification,transfers of financial instruments between different levels of fair value hierarchy,changes in classification of financial assets and changes in contingent liabilities and assets.IFRIC 13(amendment)Customer Loyalty Programmes clarifies that when the fair value of award credits is measur

128、ed on the basis of the value of the awards for which they could be redeemed,the fair value of the award credits should take account of expected forfeitures as well as the discounts or incentives that would otherwise be offered to customers who have not earned award credits from an initial sale.Stand

129、ards and amendments effective after 2011 which are relevant to the Groups operations and yet to be adoptedAmendmentstoIFRS7Financial Instruments:Disclosures on DerecognitionIFRS9Financial InstrumentsIFRS 10Consolidated Financial StatementsIFRS 11Joint ArrangementsIFRS 12Disclosure of Interests in Ot

130、her EntitiesIFRS 13Fair Value MeasurementAmendments to IAS 1Presentation of Items of Other Comprehensive IncomeIAS19(amended2011)Employee BenefitsIAS27(2011)Separate Financial StatementsIAS 28(2011)Investments in Associates and Joint VenturesAmendmentstoIFRS7FinancialInstruments:DisclosuresonDerecog

131、nition(effectiveforannualperiodbeginning1st July 2011)promotes transparency in the reporting of transfer transactions and improves users understanding of the risk exposures relating to transfer of financial assets and the effect of those risks on an entitys financial position particularly those invo

132、lving securitization of financial assets.IFRS9FinancialInstruments(effective1stJanuary2015)isthefirststandardissuedaspartofawiderprojecttoreplaceIAS39.IFRS9(2009)retainsbutsimplifiesthemixedmeasurementmodelandestablishestwoprimarymeasurement categories for financial assets:amortized cost and fair va

133、lue.The basis of classification depends on the entitysbusinessmodelandthecontractualcashflowcharacteristicsofthefinancialasset.TheguidanceinIAS39onimpairmentoffinancialassetsandhedgeaccountingcontinuestoapply.IFRS9(2010)addstherequirementsrelatedto the classification and measurement of financial lia

134、bilities,and derecognition of financial assets and liabilities,to theversionissuedinNovember2009.ItalsoincludesthoseparagraphsofIAS39dealingwithhowtomeasurefairvalue and accounting for derivatives embedded in a contract that contains a host that is not a financial asset,as well astherequirementsofIF

135、RIC9RemeasurementofEmbeddedDerivatives.TheGrouphasyettoassessthefullimpactofIFRS9andwillapplythestandardfrom1stJanuary2015.IFRS 10 Consolidated Financial Statements(effective 1st January 2013)replaces SIC Interpretation 12 Consolidation SpecialPurposeEntitiesandmostofIAS27ConsolidatedandSeparateFina

136、ncialStatements.Itcontainsanewsingle consolidation model that identifies control as the basis for consolidation for all types of entities.It provides a definition of control that comprises the elements of power over an investee;exposure of rights to variable returns from an investee;and ability to u

137、se power to affect the reporting entitys returns.The Group has yet to assess the full impact of IFRS 10 and will apply the standard from 1st January 2013.Dairy Farm International Holdings Limited Annual Report 201120Notes to the Financial StatementsIFRS 11 Joint Arrangements(effective 1st January 20

138、13)replaces IAS 31 Interests in Joint Ventures and classifies joint arrangements as either joint operations(whereby the parties that have joint control have rights to the assets and obligations for the liabilities of the joint arrangements)or joint ventures(whereby the parties that have joint contro

139、l have rights to the net assets of the joint arrangements).It prescribes the accounting for interests in joint operations as its interest in the assets,liabilities,revenues and expenses.The current option permitted by IAS 28(amended)to proportionately consolidate for joint ventures is no longer perm

140、itted.The Group has yet to assess the full impact of IFRS 11 and will apply the standard from 1st January 2013.IFRS 12 Disclosure of Interests in Other Entities(effective 1st January 2013)requires entities to disclose information that helps financial statements readers to evaluate the nature,risks a

141、nd financial effects associated with the entitys interests in subsidiaries,associates,joint arrangements and unconsolidated structured entities.Disclosure required includes significant judgements and assumptions made in determining whether an entity controls,jointly controls,significantly influences

142、 or has some other interests in other entities.The Group will apply the standard from 1st January 2013.IFRS 13 Fair Value Measurement(effective 1st January 2013)requires entities to disclose information about the valuation techniques and inputs used to measure fair value,as well as information about

143、 the uncertainty inherent in fair value measurements.The standard applies to both financial and non-financial items measured at fair value.Fair value is now defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participa

144、nts at the measurement date(i.e.an exit price).The Group will apply the standard from 1st January 2013.Amendments to IAS 1 Presentation of Items of Other Comprehensive Income(effective 1st July 2012)improves the consistency and clarity of the presentation of items of other comprehensive income.The a

145、mendments require entities to separate items presented in other comprehensive income into two groups,based on whether or not they may be recycled to profit or loss in the future.Items that will not be recycled such as actuarial gains or losses on defined benefit pension plans will be presented separ

146、ately from items that may be recycled in the future such as deferred gains and losses on cash flow hedges.The amounts of tax related to the two groups are required to be allocated on the same basis.The Group will apply the standard from 1st January 2013.IAS19(amended2011)EmployeeBenefits(effective1s

147、tJanuary2013)requirestheassumedreturnonplanassetsrecognized in the profit and loss to be the same as the rate used to discount the defined benefit obligation.It also requires actuarial gains and losses to be recognized immediately in other comprehensive income and past service costs immediately in p

148、rofit or loss.Additional disclosures are required to present the characteristics of benefit plans,the amount recognized in the financial statements,and the risks arising from defined benefit plans and multi-employer plans.The Group will apply the standard from 1st January 2013.IAS27(2011)SeparateFin

149、ancialStatements(effective1stJanuary2013)supersedesIAS27(2008)andprescribestheaccounting and disclosure requirements for investments in subsidiaries,joint ventures and associates when an entity prepares separate financial statements.There will be no impact on the consolidated financial statements as

150、 the changes only affect the separate financial statements of the investing entity.IAS 28(2011)Investments in Associates and Joint Ventures(effective 1st January 2013)supersedes IAS 28(2008)and prescribes the accounting for investments in associates and joint ventures and sets out the requirements f

151、or the application of the equity method when accounting for investments in associates and joint ventures.The adoption of this standard is not expected to have any significant impact on the results of the Group as the Group is already following the standard.The principal operating subsidiaries,associ

152、ates and joint ventures have different functional currencies in line with the economic environments of the locations in which they operate.The functional currency of the Company is United States dollars.The consolidated financial statements are presented in United States dollars.TheGroupsreportables

153、egmentsaresetoutinnotes4,5and7andaredescribedonpage31.Dairy Farm International Holdings Limited Annual Report 201121Notes to the Financial StatementsBasis of consolidation(i)The consolidated financial statements include the financial statements of the Company,its subsidiaries,and its associates and

154、joint ventures.(ii)Subsidiaries are entities over which the Group has the power to govern the financial and operating policies.The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group.The cost of an acquisition includes the fair value at the acquisition d

155、ate of any contingent consideration.In a business combination achieved in stages,the Group remeasures its previously held interest in the acquiree at its acquisition-date fair value and recognizes the resulting gain or loss in profit and loss.Changes in a parents ownership interest in a subsidiary t

156、hat do not result in the loss of control are accounted for as equity transactions.When control over a previous subsidiary is lost,any remaining interest in the entity is remeasured at fair value and the resulting gain or loss is recognized in profit and loss.All material intercompany transactions,ba

157、lances and unrealized surpluses and deficits on transactions between Group companies have been eliminated.(iii)Associates are entities,not being subsidiaries or joint ventures,over which the Group exercises significant influence.Joint ventures are entities which the Group jointly controls with one o

158、r more other venturers.Associates and joint ventures are included on the equity basis of accounting.Profits and losses resulting from upstream and downstream transactions between the Group and its associates are recognized in the consolidated financial statements only to the extent of unrelated inve

159、stors interests in the associates.(iv)Non-controlling interests represent the proportion of the results and net assets of subsidiaries and their associates and joint ventures not attributable to the Group.(v)The results of subsidiaries,associates and joint ventures are included or excluded from thei

160、r effective dates of acquisition or disposal,respectively.The results of entities other than subsidiaries,associates and joint ventures are included to the extent of dividends received when the right to receive such dividend is established.Foreign currenciesTransactions in foreign currencies are acc

161、ounted for at the exchange rates ruling at the transaction dates.Assets and liabilities of subsidiaries,associates and joint ventures,together with all other monetary assets and liabilities expressed in foreign currencies,are translated into United States dollars at the rates of exchange ruling at t

162、he year end.Results expressed in foreign currencies are translated into United States dollars at the average rates of exchange ruling during the year,which approximate the exchange rates at the dates of the transactions.Exchange differences arising from the retranslation of the net investment in for

163、eign subsidiaries,associates and joint ventures,and of financial instruments which are designated as hedges of such investments,are recognized in other comprehensive income and accumulated in equity under exchange reserves.On the disposal of these investments,such exchange differences are recognized

164、 in profit and loss.Exchange differences on available-for-sale investments are recognized in other comprehensive income as part of the gains and losses arising from changes in their fair value.All other exchange differences are recognized in profit and loss.Goodwill and fair value adjustments arisin

165、g on acquisition of a foreign entity after 1st January 2003 are treated as assets and liabilities of the foreign entity and translated into United States dollars at the rate of exchange ruling at the year end.Dairy Farm International Holdings Limited Annual Report 201122Notes to the Financial Statem

166、entsImpairmentAssets that have indefinite useful lives are not subject to amortization and are tested for impairment annually and whenever there is an indication that the assets may be impaired.Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumst

167、ances indicate that the carrying amount may not be recoverable.For the purpose of assessing impairment,assets are grouped at the lowest level for which there is a separately identifiable cash flow.Cash-generating units or groups of cash-generating units to which goodwill has been allocated are teste

168、d for impairment annually and whenever there is an indication that the units may be impaired.An impairment loss is recognized for the amount by which the carrying amount of the asset exceeds its recoverable amount,which is the higher of an assets fair value less costs to sell and value in use.Intang

169、ible assets(i)Goodwill represents the excess of the cost of an acquisition over the fair value of the Groups share of the net identifiable assets of the acquired subsidiary,associate or joint venture at the effective date of acquisition.Non-controlling interests are measured at their proportionate s

170、hare of the net identifiable assets at the acquisition dates.If the cost of acquisition is less than the fair value of the net assets acquired,the difference is recognized directly in profit and loss.Goodwill on acquisitions of subsidiaries is included in intangible assets.Goodwill on acquisitions o

171、f associates and joint ventures is included in investment in associates and joint ventures.Goodwill is allocated to cash-generating units or groups of cash-generating units for the purpose of impairment testing and is carried at cost less accumulated impairment loss.The profit or loss on disposal of

172、 subsidiaries,associates and joint ventures includes the carrying amount of goodwill relating to the entity sold.(ii)Leasehold land represents payments to third parties to acquire short-term interests in property.These payments are stated at cost and are amortized over the useful life of the lease w

173、hich includes the renewal period if the lease can be renewed by the Group without significant cost.(iii)Other intangible assets are stated at cost less accumulated amortization.Amortization is calculated on the straight line basis to allocate the cost of intangible assets over their estimated useful

174、 lives.Tangible fixed assets and depreciationFreehold land and buildings,and the building component of owner-occupied leasehold properties are stated at cost less any accumulated depreciation and impairment.Long-term interests in leasehold land are classified as finance leases and grouped under tang

175、ible assets if substantially all risks and rewards relating to the land have been transferred to the Group,and are amortized over the useful life of the lease.Grants related to tangible assets are deducted in arriving at the carrying amount of the assets.Other tangible fixed assets are stated at cos

176、t less amounts provided for depreciation.Depreciation of tangible fixed assets is calculated on the straight line basis to allocate the cost of each asset to its residual value over its estimated useful life.The residual values and useful lives are reviewed at each balance sheet date.The estimated u

177、seful lives are as follows:Buildings3050yearsLeasehold improvementsperiod of the leaseLeasehold landperiod of the leasePlant and machinery320yearsFurniture,equipment and motor vehicles215yearsNo depreciation is provided on freehold land as it is deemed to have an indefinite life.Where the carrying a

178、mount of a tangible fixed asset is greater than its estimated recoverable amount,it is written down immediately to its recoverable amount.The profit or loss on disposal of tangible fixed assets is recognized by reference to their carrying amount.Dairy Farm International Holdings Limited Annual Repor

179、t 201123Notes to the Financial StatementsInvestments(i)Investments are classified by management as available for sale on initial recognition.Available-for-sale investments are shown at fair value.Gains or losses arising from changes in the fair value are recognized in other comprehensive income.On t

180、he disposal of an investment or when an investment is determined to be impaired,the cumulative gain or loss previously deferred in equity is recognized in profit and loss.Investments are classified under non-current assets unless they are expected to be realized within twelve months after the balanc

181、e sheet date.(ii)At each balance sheet date,the Group assesses whether there is objective evidence that an investment is impaired.(iii)All purchases and sales of investments are recognized on the trade date,which is the date that the Group commits to purchase or sell the investment.LeasesLeases are

182、classified as finance leases when the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.All other leases are classified as operating leases.Payments made under operating leases(net of any incentives received from the lessor)are charged to profit and loss

183、on a straight line basis over the period of the lease.When a lease is terminated before the lease period has expired,any payment required to be made to the lessor by way of penalty is recognized as an expense in the year in which termination takes place.StocksStocks,which principally comprise goods

184、held for resale,are stated at the lower of cost and net realizable value.Cost is determined by the first-in,first-out method.DebtorsTrade debtors are measured at amortized cost except where the effect of discounting would be immaterial.Provision for impairment is established when there is objective

185、evidence that the outstanding amounts will not be collected.Significant financial difficulties of the debtor,probability that the debtor will enter bankruptcy or financial reorganization,and default or delinquency in payments are considered indicators that the debt is impaired.The carrying amount of

186、 the asset is reduced through the use of an allowance account and the amount of the loss is recognized in arriving at operating profit.When a debt is uncollectible,it is written off against the allowance account.Subsequent recoveries of amount previously written off are credited to profit and loss.D

187、ebtors with maturities greater than twelve months after the balance sheet date are classified under non-current assets.Cash and cash equivalentsFor the purposes of the cash flow statement,cash and cash equivalents comprise deposits with banks,and bank and cash balances,net of bank overdrafts.In the

188、balance sheet,bank overdrafts are included in current borrowings.ProvisionsProvisions are recognized when the Group has present legal or constructive obligations as a result of past events,it is probable that an outflow of resources embodying economic benefits will be required to settle the obligati

189、ons,and a reliable estimate of the amount of the obligations can be made.Borrowings and borrowing costsBorrowings are initially recognized at fair value,net of transaction costs incurred.In subsequent periods,borrowings are stated at amortized cost using the effective interest method.Borrowing costs

190、 relating to major development projects are capitalized during the construction period until the asset is substantially completed.Capitalized borrowing costs are included as part of the cost of the asset.All other borrowing costs are expensed as incurred.Borrowings are classified under non-current l

191、iabilities unless these are due to be settled within twelve months after the balance sheet date.Dairy Farm International Holdings Limited Annual Report 201124Notes to the Financial StatementsDeferred taxDeferred tax is provided,using the liability method,for all temporary differences arising between

192、 the tax bases of assets and liabilities and their carrying values.Deferred tax is determined using tax rates and laws that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realized or the deferred tax liability is

193、settled.Provision for deferred tax is made on the revaluation of certain non-current assets and,in relation to acquisitions,on the difference between the fair value of the net assets acquired and their tax base.Deferred tax is provided on temporary differences associated with investments in subsidia

194、ries,associates and joint ventures,except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.Deferred tax assets relating to the carry forward of unused tax losses are recognized to t

195、he extent that it is probable that future taxable profit will be available against which the unused tax losses can be utilized.Employee benefits(i)Pension obligationsThe Group operates a number of defined benefit and defined contribution plans,the assets of which are held in trustee administered fun

196、ds.Pension accounting costs for defined benefit plans are assessed using the projected unit credit method.Under this method,the costs of providing pensions are charged to profit and loss spreading the regular cost over the service lives of employees in accordance with the advice of qualified actuari

197、es,who carry out a full valuation of major plans every year.The pension obligations are measured as the present value of the estimated future cash outflows by reference to market yields on high quality corporate bonds which have terms to maturity approximating the terms of the related liability.Plan

198、 assets are measured at fair value.Actuarial gains and losses are recognized in other comprehensive income in the year in which they occur.The Groups total contributions relating to the defined contribution plans are charged to profit and loss in the year to which they relate.(ii)Share-based compens

199、ationThe Company operates a number of equity settled employee share option schemes.The fair value of the employee servicesreceivedinexchangeforthegrantoftheoptionsinrespectofoptionsgrantedafter7thNovember2002isrecognized as an expense.The total amount to be expensed over the vesting period is determ

200、ined by reference to the fair value of the options granted as determined on the grant date.At each balance sheet date,the entity revises its estimates of the number of options that are expected to become exercisable.The impact of the revision of original estimates,if any,is recognized in profit and

201、loss.Non-current assets held for saleNon-current assets are classified as assets held for sale and stated at the lower of carrying amount and fair value less costs to sell if their carrying amount is expected to be recovered principally through a sale transaction rather than through continuing use.D

202、erivative financial instrumentsThe Group enters into derivative financial instruments only in order to hedge underlying exposures.Derivative financial instruments are initially recognized at fair value on the date a derivative contract is entered into and are subsequently remeasured at their fair va

203、lue.The method of recognizing the resulting gain or loss is dependent on the nature of the item being hedged.The Group designates certain derivatives as either a hedge of the fair value of a recognized asset or liability(fair value hedge),or a hedge of a forecasted transaction or of the foreign curr

204、ency risk on a firm commitment(cash flow hedge),or a hedge of a net investment in a foreign entity.Changes in the fair value of derivatives that are designated and qualify as fair value hedges and that are highly effective,are recognized in profit and loss,along with any changes in the fair value of

205、 the hedged asset or liability that is attributable to the hedged risk.When a hedging instrument expires or is sold,or when a hedge no longer meets the criteria for hedge accounting,the cumulative adjustment to the carrying amount of a hedged item for which the effective interest method is used is a

206、mortized to profit and loss over the residual period to maturity.Dairy Farm International Holdings Limited Annual Report 201125Notes to the Financial StatementsChanges in the fair value of derivatives that are designated and qualify as cash flow hedges and that are highly effective,are recognized in

207、 other comprehensive income and accumulated in equity under hedging reserves.Where the forecasted transaction or firm commitment results in the recognition of a non-financial asset or of a non-financial liability,the gains and losses previously deferred in hedging reserves are transferred from hedgi

208、ng reserves and included in the initial measurement of the cost of the asset or liability.Otherwise,amounts deferred in hedging reserves are transferred to profit and loss in the same periods during which the hedged firm commitment or forecasted transaction affects profit and loss.When a hedging ins

209、trument expires or is sold,or when a hedge no longer meets the criteria for hedge accounting,any cumulative gain or loss existing in hedging reserves at that time remains in the hedging reserves and is recognized when the committed or forecasted transaction ultimately is recognized in profit and los

210、s.When a committed or forecasted transaction is no longer expected to occur,the cumulative gain or loss that was reported in hedging reserves is immediately transferred to profit and loss.Certain derivative transactions,while providing effective economic hedges under the Groups risk management polic

211、ies,donotqualifyforhedgeaccountingunderthespecificrulesinIAS39.ChangesinthefairvalueofanyderivativeinstrumentsthatdonotqualifyforhedgeaccountingunderIAS39arerecognizedimmediatelyinprofitandloss.Hedges of net investments in foreign entities are accounted for on a similar basis to that used for cash f

212、low hedges.Any gain or loss on the hedging instrument relating to the effective portion of the hedge is recognized in exchange reserves;the gain or loss relating to the ineffective portion is recognized immediately in profit and loss.The fair value of derivatives which are designated and qualify as

213、effective hedges are classified as non-current assets or liabilities if the remaining maturities of the hedged assets or liabilities are greater than twelve months after the balance sheet date.Financial guarantee contractsFinancial guarantee contracts under which the Group accepts significant risk f

214、rom a third party by agreeing to compensate that party on the occurrence of a specified uncertain future event are accounted for in a manner similar to insurance contracts.Provisions are recognized when it is probable that the Group has obligations under such guarantees and an outflow of resources e

215、mbodying economic benefits will be required to settle the obligations.Non-trading itemsNon-trading items are separately identified to provide greater understanding of the Groups underlying business performance.Items classified as non-trading items include gains and losses arising from the sale of bu

216、sinesses,investments and properties;impairment of non-depreciable intangible assets and other investments;provisions for the closure of businesses;acquisition-related costs in business combinations;and other credits and charges of a non-recurring nature that require inclusion in order to provide add

217、itional insight into underlying business performance.Earnings per shareBasic earnings per share are calculated on profit attributable to shareholders and on the weighted average number of shares in issue during the year.The weighted average number excludes the shares held by the Trustee under the Se

218、nior Executive Share Incentive Schemes.For the purpose of calculating diluted earnings per share,profit attributable to shareholders is adjusted for the effects of the conversion of dilutive potential ordinary shares,and the weighted average number of shares is adjusted for the number of shares whic

219、h are deemed to be issued for no consideration under the Senior Executive Share Incentive Schemes based on the average share price during the year.DividendsDividends proposed or declared after the balance sheet date are not recognized as a liability at the balance sheet date.SalesSales consist of th

220、e net value of goods sold to customers,excluding sales taxes.This does not include sales generated by associates and joint ventures.Sale of goods is recognized when the significant risks and rewards of ownership of the goods have been transferred to customers.Sales are recognized at the point of sal

221、e and are recorded at the net amount received from customers.Dairy Farm International Holdings Limited Annual Report 201126Notes to the Financial StatementsPre-operating costsPre-operating costs are expensed as they are incurred.Comparative figuresCertain comparative figures have been reclassified t

222、o conform with the current year presentation.2.FINANCIAL RISK MANAGEMENTFinancial risk factorsThe Groups activities expose it to a variety of financial risks:market risk(including foreign exchange risk and interest rate risk),credit risk and liquidity risk.The Groups treasury function co-ordinates f

223、inancial risk management policies and their implementation on a group-wide basis.The Groups treasury policies are designed to manage the financial impact of fluctuations in interest rates and foreign exchange rates and to minimize the Groups financial risks.The Group uses derivative financial instru

224、ments,principally interest rate swaps,caps,forward foreign exchange contracts and foreign currency options as appropriate for hedging transactions and managing the Groups assets and liabilities in accordance with the Groups financial risk management policies.Financial derivative contracts are execut

225、ed between third party banks and the Group entity that is directly exposed to the risk being hedged.Certain derivative transactions,while providing effective economic hedges undertheGroupsriskmanagementpolicies,donotqualifyforhedgeaccountingunderthespecificrulesinIAS39.Changesinthefairvalueofanyderi

226、vativeinstrumentsthatdonotqualifyforhedgeaccountingunderIAS39arerecognized immediately in profit and loss.It is the Groups policy not to enter into derivative transactions for speculative purposes.The notional amounts and fair values of derivative financial instruments at 31st December 2011 are disc

227、losed in note 30.(i)Market riskForeign exchange riskEntities within the Group are exposed to foreign exchange risk from future commercial transactions,net investments in foreign operations and net monetary assets and liabilities that are denominated in a currency that is not the entitys functional c

228、urrency.Entities in the Group use forward foreign exchange contracts and foreign currency options in a consistent manner to hedge firm and anticipated foreign exchange commitments and manage their foreign exchange risk arising from future commercial transactions.Group companies are required to manag

229、e their foreign exchange risk against their functional currency.The purpose of these hedges is to mitigate the impact of movements in foreign exchange rates on assets and liabilities and the profit and loss account of the Group.CurrencyrisksasdefinedbyIFRS7ariseonaccountofmonetaryassetsandliabilitie

230、sbeingdenominatedinacurrencythat is not the functional currency.There are no significant monetary balances held by Group companies at 31st December 2011 that are denominated in a non-functional currency.Interest rate riskThe Group is exposed to interest rate risk through the impact of rate changes o

231、n interest bearing liabilities and assets.These exposures are managed partly by using natural hedges that arise from offsetting interest rate sensitive assets and liabilities,and partly through the use of derivative financial instruments such as interest rate swaps and caps.The Group monitors intere

232、st rate exposure on a monthly basis by currency and business unit,taking into consideration proposedfinancingandhedgingarrangements.TheGroupsguidelineistomaintain40%to60%ofitsgrossborrowingsin fixed rate instruments.At 31st December 2011 the Groups interest rate hedge was 52%(2010:51%),with an avera

233、ge tenor of 0.8 year(2010:1.3 years).The interest rate profile of the Groups borrowings after taking into account hedging transactions is set out in note 21.Dairy Farm International Holdings Limited Annual Report 201127Notes to the Financial StatementsCash flow interest rate risk is the risk that ch

234、anges in market interest rates will impact cash flows arising from variable rate financial instruments.Borrowings at floating rates therefore expose the Group to cash flow interest rate risk.The Group manages this risk by entering into interest rate swaps and caps for a maturity of up to five years.

235、Interest rate swaps have the economic effect of converting borrowings from floating rate to fixed rate,whilst caps provide protection against a rise in floating rates above a pre-determined rate.At 31st December 2011,if interest rates had been 100 basis points higher/lower with all other variables h

236、eld constant,theGroupsprofitaftertaxwouldhavebeenUS$4.9million(2010:US$3.9 million)higher/lower,and hedging reserves would have been US$1.2 million(2010:US$3.2 million)higher/lower,as a result of fair value changes to cash flow hedges.The sensitivity analysis has been determined assuming that the ch

237、ange in interest rates had occurred at the balance sheet date and had been applied to the exposure to interest rate risk for both derivative and non-derivative financial instruments in existence at that date.The 100 basis point increase or decrease represents managements assessment of a reasonably p

238、ossible change in those interest rates which have the most impact on the Group,specifically the United States and Malaysia rates over the period until the next annual balance sheet date.Changes in market interest rates affect the interest income or expense of non-derivative variable-interest financi

239、al instruments,the interest payments of which are not designated as hedged items of cash flow hedges against interest rate risks.As a consequence,they are included in the calculation of profit after tax sensitivities.Changes in the market interest rate of financial instruments that were designated a

240、s hedging instruments in a cash flow hedge to hedge payment fluctuations resulting from interest rate movements affect the hedging reserves and are therefore taken into consideration in the equity-related sensitivity calculations.(ii)Credit riskThe Groups credit risk is primarily attributable to dep

241、osits with banks and credit exposures to derivative financial instruments with a positive fair value.The Group has credit policies in place and the exposures to these credit risks are monitored on an ongoing basis.The Group manages its deposits with banks and transactions involving derivative financ

242、ial instruments by monitoring credit ratings,capital adequacy ratios,and limiting the aggregate risk to any individual counterparty.The utilization ofcreditlimitsisregularlymonitored.At31stDecember2011,over99%(2010:99%)of deposits and balances with banks were made to institutions with credit ratings

243、 of no less than A-(Fitch).Similarly,transactions involving derivative financial instruments are with banks with sound credit ratings and capital adequacy ratios.In developing countries it may be necessary to deposit money with banks that have a lower credit rating,however,the Group only enters into

244、 derivative transactions with counterparties which have credit ratings of at least investment grade.Management does not expect any counterparty to fail to meet its obligations.Sales to customers are made in cash or by major credit cards.The maximum exposure to credit risk is represented by the carry

245、ing amount of each financial asset in the balance sheet after deducting any impairment allowance.(iii)Liquidity riskPrudent liquidity risk management includes managing the profile of debt maturities and funding sources,maintaining sufficient cash,and ensuring the availability of funding from an adeq

246、uate amount of committed credit facilities and the ability to close out market positions.The Groups ability to fund its existing and prospective debt requirements is managed by maintaining diversified funding sources with adequate committed funding lines from high quality lenders,and by monitoring r

247、olling short-term forecasts of the Groups cash and gross debt on the basis of expected cash flows.In addition long-term cash flows are projected to assist with the Groups long-term debt financing plans.At31stDecember2011,totalavailableborrowingfacilitiesamountedtoUS$925.6million(2010:US$1,179.6 mill

248、ion),ofwhichUS$263.6million(2010:US$458.4 million)was drawn down.Undrawn committed facilities,in the form of revolvingcreditfacilities,totalledUS$306.1million(2010:US$404.7 million).Dairy Farm International Holdings Limited Annual Report 201128Notes to the Financial StatementsThe table below analyze

249、s the Groups non-derivative financial liabilities and derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date.Derivative financial liabilities are included in the analysis if their contractual maturiti

250、es are essential for an understanding of the timing of the cash flows.The amounts disclosed in the table are the contractual undiscounted cash flows.WithinoneyearUS$mBetweenone andtwo yearsUS$mBetweentwo andthree yearsUS$mBetween three and four yearsUS$mBetweenfour andfive yearsUS$mBeyondfiveyearsUS

251、$mTotal undiscounted cash flowsUS$mAt 31st December 2011Creditors2,134.411.61.50.20.22.92,150.8Borrowings140.2104.51.516.70.916.4280.2Net settled derivative financial instruments0.70.20.9Gross settled derivative financial instruments27.127.1At 31st December 2010Creditors1,863.310.4 1.2 3.4 1,878.3Bo

252、rrowings136.6136.9156.57.3 42.3 17.9497.5Net settled derivative financial instruments4.1 0.5 0.1 4.7Gross settled derivative financial instruments26.826.8Capital managementThe Groups objectives when managing capital are to safeguard the Groups ability to continue as a going concern whilst seeking to

253、 maximize benefits to shareholders and other stakeholders.Capital is equity as shown in the consolidated balance sheet plus net debt.The Group actively and regularly reviews and manages its capital structure to ensure optimal capital structure and shareholder returns,taking into consideration the fu

254、ture capital requirements of the Group and capital efficiency,prevailing and projected profitability,projected operating cash flows,projected capital expenditures and projected strategic investment opportunities.In order to maintain or adjust the capital structure,the Group may adjust the amount of

255、dividends paid to shareholders,repurchase Company shares,return capital to shareholders,issue new shares or sell assets to reduce debt.The Group monitors capital on the basis of the Groups consolidated gearing ratio and consolidated interest cover.The gearing ratio is calculated as net debt divided

256、by total equity.Net debt is calculated as total borrowings less bank balances and other liquid funds.Interest cover is calculated as underlying operating profit and share of results of associates and joint ventures divided by net financing charges.The Group does not have a defined gearing or interes

257、t cover benchmark or range.The ratios at 31st December 2011 and 2010 are as follows:20112010Interest cover(times)3423The Group had a net cash position at 31st December 2011 and 2010,as a result of improved working capital and increased operating profits.The increase in interest cover is also as a re

258、sult of increased operating profits.Dairy Farm International Holdings Limited Annual Report 201129Notes to the Financial StatementsFair value estimation(i)Financial instruments that are measured at fair value-inputs other than quoted prices in active markets that are observable for the asset or liab

259、ility,either directly or indirectly(observable current market transactions).The fair values of all interest rate swaps,caps and forward foreign exchange contracts have been determined using rates quoted by the Groups bankers at the balance sheet date which are calculated by reference to the market i

260、nterest rates and foreign exchange rates.(ii)Financial instruments that are not measured at fair valueThe fair values of current debtors,bank balances and other liquid funds,current creditors and current borrowings are assumed to approximate their carrying amounts due to the short-term maturities of

261、 these assets and liabilities.The fair values of long-term borrowings are based on market prices or are estimated using the expected future payments discounted at market interest rates.3.CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTSEstimates and judgements used in preparing the financial statements a

262、re continually evaluated and are based on historical experience and other factors,including expectations of future events that are believed to be reasonable.The resulting accounting estimates will,by definition,seldom equal the related actual results.The estimates and assumptions that have a signifi

263、cant effect on the carrying amounts of assets and liabilities are discussed below.Acquisition of subsidiaries,associates and joint venturesThe initial accounting on the acquisition of subsidiaries,associates and joint ventures involves identifying and determining the fair values to be assigned to th

264、e identifiable assets,liabilities and contingent liabilities of the acquired entities.The fair values of leasehold land and tangible assets are determined by independent valuers by reference to market prices or present value of expected net cash flows from the assets.Any changes in the assumptions u

265、sed and estimates made in determining the fair values,and managements ability to measure reliably the contingent liabilities of the acquired entity will impact the carrying amount of these assets and liabilities.Tangible fixed assets and depreciationManagement determines the estimated useful lives a

266、nd related depreciation charges for the Groups tangible fixed assets.Management will revise the depreciation charge where useful lives are different to those previously estimated,or it will write-off or write-down technically obsolete or non-strategic assets that have been abandoned.Impairment of as

267、setsThe Group tests annually whether goodwill and other assets that have indefinite useful lives suffered any impairment.Other assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset exceeds its recoverable amount.The recoverable

268、amount of an asset or a cash generating unit is determined based on the higher of its fair value less costs to sell and its value in use,calculated on the basis of managements assumptions and estimates.Changing the key assumptions,including the discount rates or the growth rate assumptions in the ca

269、sh flow projections,could materially affect the value-in-use calculations.Income taxesThe Group is subject to income taxes in numerous jurisdictions.Significant judgement is required in determining the worldwide provision for income taxes.There are many transactions and calculations for which the ul

270、timate tax determination is uncertain during the ordinary course of business.Where the final tax outcome of these matters is different from the amounts that were initially recorded,such differences will impact the income tax and deferred tax provisions in the period in which such determination is ma

271、de.Provision of deferred tax follows the way management expects to recover or settle the carrying amount of the related assets or liabilities,which the management may expect to recover through use,sale or combination of both.Accordingly,deferred tax will be calculated at income tax rate,capital gain

272、s tax rate or combination of both.Recognition of deferred tax assets,which principally relate to tax losses,depends on the managements expectation of future taxable profit that will be available against which the tax losses can be utilized.The outcome of their actual utilization may be different.Dai

273、ry Farm International Holdings Limited Annual Report 201130Notes to the Financial StatementsPension obligationsThe present value of the pension obligations depends on a number of factors that are determined on an actuarial basis using a number of assumptions.The assumptions used in determining the n

274、et cost/income for pensions include the expected long-term rate of return on the relevant plan assets and the discount rate.Any changes in these assumptions will impact the carrying amount of pension obligations.The expected return on plan assets assumption is determined on a uniform basis,taking in

275、to consideration long-term historical returns,asset allocation and future estimates of long-term investment returns.The Group determines the appropriate discount rate at the end of each year.This is the interest rate that should be used to determine the present value of estimated future cash outflow

276、s expected to be required to settle the pension obligations.In determining the appropriate discount rate,the Group considers the interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid,and that have terms to maturity approximating the te

277、rms of the related pension obligation.Other key assumptions for pension obligations are based in part on current market conditions.Non-trading itemsThe Group uses underlying business performance in its internal financial reporting to distinguish between the underlying profits and non-trading items.T

278、he identification of non-trading items requires judgement by management,but follows the consistent methodology as set out in the Groups accounting policies.Dairy Farm International Holdings Limited Annual Report 201131Notes to the Financial StatementsIncluding associates and joint ventures Subsidiar

279、ies 4.SALES2011US$m2010US$m2011US$m2010US$mAnalysis by operating segment:North Asia4,537.34,009.84,537.34,009.8East Asia2,788.22,395.82,787.82,395.8South Asia1,880.91,629.91,809.31,564.99,206.4 8,035.5 9,134.47,970.5Maxims1,242.61,077.610,449.09,113.19,134.47,970.5Analysis by format:Supermarkets/hyp

280、ermarkets5,516.54,848.65,474.14,807.6Health and beauty stores1,750.31,454.61,720.71,430.6Convenience stores1,584.81,426.21,584.81,426.2Home furnishings stores 354.8306.1354.8306.19,206.4 8,035.5 9,134.47,970.5Restaurants1,242.61,077.610,449.09,113.19,134.47,970.5Sales including associates and joint

281、ventures comprise 100%of sales from associates and joint ventures.Operating segments are identified on the basis of internal reports about components of the Group that are regularly reviewed by the Board for the purpose of resource allocation and performance assessment.Dairy Farm operates in four op

282、erating segments:North Asia,East Asia,South Asia and Maxims.North Asia comprises Hong Kong,mainland China,Macau and Taiwan.East Asia comprises Malaysia,Indonesia,Vietnam and Brunei.South Asia comprises Singapore and India.Maxims is the Groups major associate,a leading Hong Kong restaurant chain.No o

283、perating segments have been aggregated to form the reportable segments.5.OPERATING PROFIT2011US$m2010US$mAnalysis by operating segment:North Asia258.1215.9East Asia199.3178.0South Asia113.8107.0571.2500.9Support office(35.9)(31.2)535.3469.7Non-trading items in East Asia:acquisition-relatedcostsinbus

284、inesscombinations(0.7)profitonsaleofaproperty0.3535.3469.3Analysis by format:Supermarkets/hypermarkets282.3266.9Health and beauty stores164.6131.2Convenience stores67.155.3Home furnishings stores35.932.2Other21.315.3571.2500.9Dairy Farm International Holdings Limited Annual Report 201132Notes to the

285、 Financial Statements5.OPERATING PROFIT(continued)The following items have been charged/(credited)in arriving at operating profit:2011US$m2010US$mCost of stocks recognized as expense6,435.55,580.2Amortization of intangible assets(note 11)7.05.9Depreciation of tangible assets(note 12)174.4161.4Write

286、down of stocks1.64.6Reversal of write down of stocks(0.5)(0.8)Employee benefit expensesalariesandbenefitsinkind752.5657.7shareoptionsgranted(note 25)2.21.7definedbenefitpensionplans(note 17)9.810.3definedcontributionpensionplans35.830.6800.3700.3Operating leasesminimumleasepayments675.5617.9continge

287、ntrents12.76.0subleases(47.5)(41.6)640.7582.3Auditors remunerationaudit1.51.4non-auditservices0.40.81.92.2Concession and service income(103.8)(94.2)Rental income(21.3)(15.3)Net foreign exchange gains(1.1)(1.1)Loss on sale of tangible assets6.14.76.NET FINANCING CHARGES2011US$m2010US$mInterestexpense

288、bankloansandadvances19.223.8Commitment and other fees1.91.7Financing charges21.125.5Interest income on bank deposits(3.6)(2.9)17.522.6Dairy Farm International Holdings Limited Annual Report 201133Notes to the Financial Statements7.SHARE OF RESULTS OF ASSOCIATES AND JOINT VENTURES2011US$m2010US$mAnal

289、ysis by operating segment:Maxims67.649.1East Asia(0.6)South Asia(0.9)(2.0)66.147.1Analysis by format:Restaurants67.649.1Supermarkets/hypermarkets(2.0)(2.4)Health and beauty stores0.50.466.147.1Share of results of associates and joint ventures included our share of a net gain in Maxims of US$10.5 mil

290、lion classified as non-trading item (note 10).Results are shown after tax and non-controlling interests in the associates and joint ventures.8.TAX2011US$m2010US$mTax charged to profit and loss is analyzed as follows:Current tax(100.7)(76.2)Deferred tax 1.4(7.3)(99.3)(83.5)Geographical analysis:North

291、 Asia(42.9)(31.9)East Asia(38.5)(35.4)South Asia(17.9)(16.2)(99.3)(83.5)Reconciliation between tax expense and tax at the applicable tax rate*:Tax at applicable tax rate(84.5)(72.8)Income not subject to tax0.70.4Expenses not deductible for tax purposes(7.9)(7.0)Tax losses not recognized(5.1)(5.0)Uti

292、lization of previously unrecognized tax losses1.31.4Recognition of previously unrecognized tax losses and temporary differences0.60.5Over provision in prior years0.43.2Withholding tax(2.7)(2.4)Change in tax rates(0.2)Other(2.1)(1.6)(99.3)(83.5)Tax relating to components of other comprehensive income

293、 or expense is analyzed as follows:Actuarial valuation of employee benefit plans6.00.9Cash flow hedges(0.9)(0.7)Revaluation of other investments(0.1)5.00.2Share of tax charge of associates and joint ventures of US$14.3 million(2010:US$11.6 million)is included in share of results of associates and jo

294、int ventures.The Group has no tax payable in the United Kingdom(2010:nil).Theapplicabletaxratefortheyearwas16.3%(2010:16.3%)and represents the weighted average of the rates of taxation prevailing in the territories in which the Group operates.*Dairy Farm International Holdings Limited Annual Report

295、201134Notes to the Financial Statements9.EARNINGS PER SHAREBasic earnings per share are calculated on profit attributable to shareholders of US$484.3 million(2010:US$411.4 million),and on the weighted average number of 1,350.0 million(2010:1,349.0 million)shares in issue during the year.Diluted earn

296、ings per share are calculated on profit attributable to shareholders of US$484.3 million(2010:US$411.4 million),and on the weighted average number of shares in issue after adjusting for the number of shares which are deemed to be issued for no consideration under the Senior Executive Share Incentive

297、 Schemes based on the average share price during the year.The weighted average number of shares is arrived at as follows:Ordinary shares in millions20112010Weighted average number of shares for basic earnings per share calculation1,350.01,349.0Adjustment for shares deemed to be issued for no conside

298、ration under the Senior Executive Share Incentive Schemes1.81.8Weighted average number of shares for diluted earnings per share calculation1,351.81,350.8Additional basic and diluted earnings per share are also calculated based on underlying profit attributable to shareholders.A reconciliation of ear

299、nings is set out below:20112010US$mBasic earnings per shareUSDiluted earnings per shareUSUS$mBasic earnings per shareUSDiluted earnings per share USProfit attributable to shareholders484.335.8735.83 411.4 30.5030.46Non-trading items(note 10)(10.5)(1.6)Underlying profit attributable to shareholders47

300、3.835.0935.05409.830.3830.3410.NON-TRADING ITEMSAn analysis of non-trading items after interest,tax and non-controlling interests is set out below:2011US$m2010US$mShare of net gain from sale of 30%interests in the Starbucks operations in China by Maxims10.5Release of over provision for a business di

301、sposal in prior years2.0 Profit on sale of a property0.3 Acquisition-related costs(0.7)10.51.6Dairy Farm International Holdings Limited Annual Report 201135Notes to the Financial Statements11.INTANGIBLE ASSETSGoodwillUS$mLeaseholdlandUS$mOtherUS$mTotalUS$m2011Cost290.232.9 41.4 364.5 Amortization an

302、d impairment(0.4)(1.9)(18.3)(20.6)Net book value at 1st January289.8 31.0 23.1 343.9 Exchange differences(3.2)(0.5)(0.7)(4.4)Additions7.912.320.2Disposals(0.3)(0.3)Amortization(0.9)(6.1)(7.0)Net book value at 31st December286.637.528.3352.4Cost287.040.352.2379.5Amortization and impairment(0.4)(2.8)(

303、23.9)(27.1)286.637.528.3352.42010Cost 234.1 28.928.9291.9Amortization and impairment(0.4)(1.1)(12.3)(13.8)Net book value at 1st January233.727.816.6278.1Exchange differences 12.4 1.3 1.6 15.3 New subsidiaries acquired 0.2 0.2 Additions43.72.79.856.2Amortization (0.8)(5.1)(5.9)Net book value at 31st

304、December289.8 31.0 23.1 343.9Cost290.232.9 41.4 364.5Amortization and impairment(0.4)(1.9)(18.3)(20.6)289.8 31.0 23.1 343.92011US$m2010US$mAnalysis of goodwill by operating segment:North Asia42.1 42.2 East Asia160.3162.7South Asia84.284.9286.6289.8Other intangible assets comprise mainly trademarks a

305、nd computer software.Additions of goodwill in 2010 mainly related to the acquisition of Bintang stores in Malaysia and MCP stores in Singapore(note 29(d).Goodwill is allocated to cash-generating units identified as banners or group of stores acquired.Cash flow projections for impairment reviews are

306、based on budgets prepared on the basis of assumptions reflective of the prevailing market conditions,and are discounted appropriately.Key assumptions used for value-in-usecalculationsincludebudgetedgrossmarginsofbetween24%and49%andgrowthratesofupto5%toextrapolatecashflows,whichvaryacross the Groups

307、business segments and geographical locations,over a five-year period,and are based on management expectations for the market development;andpre-taxdiscountratesofbetween7%and17%appliedtothecashflowprojections.Thediscountratesusedreflectbusinessspecificrisksrelating to the relevant industry,business

308、life-cycle and geographical location.On the basis of these reviews,management concluded that no impairment is required.The amortization charges are all recognized in arriving at operating profit and are included in selling and distribution costs and administration expenses.The remaining amortization

309、 periods for intangible assets are as follows:Leaseholdland32to57yearsOther 0 to 13 yearsDairy Farm International Holdings Limited Annual Report 201136Notes to the Financial Statements12.TANGIBLE ASSETSFreeholdpropertiesUS$mLeaseholdpropertiesUS$mLeasehold improvementsUS$mPlant&machineryUS$mFurnitur

310、e,equipment&motorvehiclesUS$mTotalUS$m2011Cost 87.4 331.3 505.3 482.8 664.5 2,071.3 Depreciation and impairment(2.1)(56.4)(344.9)(314.8)(432.3)(1,150.5)Net book value at 1st January 85.3 274.9160.4168.0 232.2 920.8 Exchange differences(3.4)(4.3)(1.4)(2.2)(2.8)(14.1)Additions32.17.746.744.789.1220.3D

311、isposals(3.1)(1.8)(2.5)(7.4)Depreciation charge(0.3)(8.5)(45.8)(48.9)(70.9)(174.4)Classified as non-current assets held for sale(18.9)(30.3)(49.2)Net book value at 31st December94.8239.5156.8159.8245.1896.0Cost 97.1298.4506.0483.8706.12,091.4Depreciation and impairment(2.3)(58.9)(349.2)(324.0)(461.0

312、)(1,195.4)94.8239.5156.8159.8245.1896.02010Cost 48.2 194.8465.2 425.5 579.71,713.4Depreciation and impairment(1.7)(45.0)(301.5)(265.2)(367.3)(980.7)Net book value at 1st January46.5149.8163.7160.3 212.4 732.7Exchange differences6.513.96.49.2 14.1 50.1 New subsidiaries acquired 15.3 1.9 2.0 1.1 20.3

313、Additions 32.4 30.0 33.1 43.771.3 210.5 Disposals(3.3)(1.0)(1.5)(5.8)Depreciation charge(0.1)(8.1)(41.8)(46.2)(65.2)(161.4)Reversal of impairment charge 0.4 0.4 Reclassified from non-current assets held for sale74.074.0Net book value at 31st December 85.3 274.9160.4168.0 232.2 920.8Cost 87.4 331.3 5

314、05.3 482.8 664.52,071.3Depreciation and impairment(2.1)(56.4)(344.9)(314.8)(432.3)(1,150.5)85.3 274.9160.4168.0 232.2 920.8NetbookvalueofleaseholdpropertiesacquiredunderfinanceleasesamountedtoUS$68.1million(2010:US$84.7 million).Dairy Farm International Holdings Limited Annual Report 201137Notes to

315、the Financial Statements13.ASSOCIATES AND JOINT VENTURES2011US$m2010US$mUnlisted associates185.8157.4Joint ventures7.7 3.2 Share of attributable net assets193.5160.6The Groups share of assets,liabilities,capital commitments,contingent liabilities and results of associates and joint ventures are summ

316、arized below:Non-current assets211.1163.7Current assets156.0 140.0 Non-current liabilities(26.5)(29.8)Current liabilities(143.5)(109.5)Total equity197.1164.4Attributable to non-controlling interests(3.6)(3.8)Attributable net assets193.5160.6Sales657.0570.9Profit after tax 66.847.8Capital commitments

317、36.8 34.4 Contingent liabilitiesMovements of share of attributable net assets for the year:At 1st January160.6 145.8 Share of results after tax and non-controlling interests66.147.1Share of other comprehensive expense after tax and non-controlling interests(1.1)(2.7)Dividends received(39.2)(29.6)Cap

318、ital injections9.9Change in interests in associates(2.8)At 31st December193.5160.6Analysis by operating segment:Maxims186.8161.8East Asia4.4South Asia2.3(1.2)At 31st December193.5160.6Dairy Farm International Holdings Limited Annual Report 201138Notes to the Financial Statements14.OTHER INVESTMENTS2

319、011US$m2010US$mMovements for the year:At 1st January3.3 3.1 Revaluation surplus0.7 0.2 At 31st December4.0 3.3 Other investments are unlisted non-current available-for-sale financial assets in North Asia.The fair value is determined on observable current market transactions.15.DEBTORS2011US$m2010US$

320、mTrade debtorsthirdparties76.250.7provisionforimpairment(0.6)(0.6)75.6 50.1 Other debtorsthirdparties269.6 234.2 provisionforimpairment(0.5)(0.4)269.1 233.8 344.7283.9Non-current126.9 123.5 Current217.8160.4344.7283.9Geographical analysis:North Asia145.8 114.8 East Asia125.2106.0South Asia73.763.134

321、4.7283.9Trade and other debtorsSales to customers are made in cash or by major credit cards.The average credit period on sale of goods and services varies among Group businesses and is normally not more than 30 days.The maximum exposure to credit risk is represented by the carrying amount of trade d

322、ebtors after deducting the impairment allowance.An allowance for impairment of trade and other debtors is made based on the estimated irrecoverable amount.Significant financial difficulties of the debtor,probability that the debtor will enter bankruptcy or financial reorganization,and default or del

323、inquency in payment are considered indicators that the debtor is impaired.Dairy Farm International Holdings Limited Annual Report 201139Notes to the Financial Statements15.DEBTORS(continued)At31stDecember2011,tradedebtorsofUS$0.6million(2010:US$0.6 million)and other debtors of US$0.5 million(2010:US

324、$0.4 million)were impaired,which have been fully provided for in both years.The ageing analysis of these debtors is as follows:Trade debtorsOther debtors2011US$m2010US$m2011US$m2010US$mOver90days0.60.60.5 0.4 At31stDecember2011,tradedebtorsofUS$6.4million(2010:US$3.3 million)andotherdebtorsofUS$1.9m

325、illion(2010:US$2.9 million),respectively,were past due but not impaired.The ageing analysis of these debtors is as follows:Trade debtorsOther debtors2011US$m2010US$m2011US$m2010US$mBelow 30 days5.32.91.0 1.2 Between31and60days0.7 0.2 0.5 0.5 Between61and90days0.2 0.1 0.2 0.3 Over90days0.2 0.1 0.20.9

326、6.4 3.3 1.92.9The risk of trade and other debtors that are neither past due nor impaired at 31st December 2011 becoming impaired is low as most of the balances have been settled subsequent to the year end.Other debtorsOther debtors are further analyzed as follows:2011US$m2010US$mPrepayments58.256.9R

327、ental and other deposits129.0 121.5 Derivative financial instruments2.4 0.2 Other79.5 55.2 269.1 233.8 Movements in the provision for impairment are as follows:Trade debtorsOther debtors2011US$m2010US$m2011US$m2010US$mAt 1st January(0.6)(0.6)(0.4)(0.2)Additional provisions(0.4)(0.3)(0.1)(0.2)Unused

328、amounts reversed0.2 0.2 Amounts written off0.2 0.1 At 31st December(0.6)(0.6)(0.5)(0.4)There were no debtors pledged as security for borrowings as at 31st December 2011 and 2010.Dairy Farm International Holdings Limited Annual Report 201140Notes to the Financial Statements16.DEFERRED TAX ASSETS/(LIA

329、BILITIES)AcceleratedtaxdepreciationUS$mFair valuegains/lossesUS$mEmployeebenefitsUS$mProvisionsand othertemporarydifferencesUS$mTotalUS$m2011At 1st January(35.8)(4.7)3.1 7.8(29.6)Exchange differences0.40.1(0.2)0.3Credited/(charged)to profit and loss0.8(2.3)2.91.4Credited/(charged)to other comprehens

330、ive income(1.0)6.05.0At 31st December(34.6)(5.7)6.910.5(22.9)Deferred tax assets1.70.17.011.820.6Deferred tax liabilities(36.3)(5.8)(0.1)(1.3)(43.5)(34.6)(5.7)6.910.5(22.9)2010At 1st January(27.9)(3.8)3.4 6.8(21.5)Exchange differences(1.6)(0.1)0.4 0.4(0.9)New subsidiary acquired(0.1)(0.1)(Charged)/c

331、redited to profit and loss(6.2)(1.7)0.6(7.3)Credited/(charged)to other comprehensive income(0.8)1.0 0.2 At 31st December(35.8)(4.7)3.1 7.8(29.6)Deferred tax assets 1.2 0.67.69.819.2Deferred tax liabilities(37.0)(5.3)(4.5)(2.0)(48.8)(35.8)(4.7)3.1 7.8(29.6)Deferred tax balances predominantly comprise

332、 non-current items.Deferred tax assets and liabilities are netted when the taxes relate to the same taxation authority and where offsetting is allowed.Deferred tax assets of US$15.8 million(2010:US$14.6 million)arisingfromunusedtaxlossesofUS$63.3million(2010:US$60.6 million)have not been recognized

333、in the financial statements.Included in the unused tax losses,US$8.3 million have no expiry date and the balance will expire at various dates up toandincluding2016.Dairy Farm International Holdings Limited Annual Report 201141Notes to the Financial Statements17.PENSION PLANSThe Group has defined benefit pension plans relating to employees in Hong Kong,Indonesia and Taiwan.These plans are final sal