09:01     SOUTH CHINA IND<00413> - Results Announcement (2)                   

    HKAS 40 introduces both cost model and fair value model for the           
    measurement of investment property.  For fair value model, HKAS 40        
    requires fair value changes be recognised in the income statement in the  
    period in which they arise.  The Group has elected to apply the fair value
    model in measuring its investment property and recognises the fair value  
    changes to the income statement in the period in which they arise.  HKAS  
    40 allows a property interest that is held under an operating lease and   
    that the property meets the definition of an investment property and the  
    lessee recognises the asset by using the fair value model set out in the  
    standard be classified and accounted for as investment property.  HKAS 40 
    has been applied retrospectively.  Comparative amounts have been restated 
    accordingly.                                                              
                                                                              
    As a result of this change in policy, the balance on the Group's          
    investment property revaluation reserve at 1 January 2003 has been        
    decreased by HK$15,281,000 and the Group's accumulated profits at 1       
    January 2003 has been increased by HK$15,281,000, which is the cumulative 
    effect of the change arising on the adoption of HKAS 40 prior to 1 January
    2003.  The change has resulted in a decrease in the profit of HK$5,412,000
    and an increase in the profit of HK$25,833,000 for the year ended 31      
    December 2003 and 2004 respectively.                                      
                                                                              
            For those new HKFRS, that the Group has not early adopted in the  
    financial statements for the year ended 31 December 2004, the Group has   
    commenced considering the potential impact of those new HKFRSs but is not 
    yet in a position to determine whether those HKFRSs would have a          
    significant impact on how its results of operations and financial position
    are prepared and presented.  Those HKFRSs may result in changes in the    
    future as to how the results and financial position are prepared and      
    presented.                                                                
                                                                              
    2.      Basic earnings per share                                          
                                                                              
    The calculation of basic earnings per share is based on the profit        
    attributable to shareholders of approximately HK$100,896,000 (2003: HK$66 
    ,514,000) and on approximately 530,335,000 shares (2003: approximately    
    530,335,000 shares) in issue during the year.                             
                                                                              
    No diluted earnings per share is presented because there is no dilutive   
    instrument in both years.                                                 
                                                                              
    For more details, please refer to the press announcement today.