| NOTES TO THE
Consolidated Income Statement |
|
1 RESTRUCTURING AND IMPAIRMENT CHARGES
The group announced a comprehensive restructuring
plan in March 2001. The restructuring measures undertaken
during the year and to be undertaken as part of the
plan include the re-organization and rationalisation
of the consumer telephone operations in the United
States to achieve greater cost efficiencies. Factories
in Mexico, which were acquired from Lucent Technologies
Consumer Products, L.P. and Lucent Technologies Inc
("Lucent") on 31st March 2000, will be divested. The
electronic learning products operations in Europe
will be centralized under regional management. In
addition, e-Business related services and other development
stage businesses such as mobile phones will be downsized
and re-organised. The information appliances and multimedia
communication business units will be merged into the
consumer phone and Contract Manufacturing Service
units respectively. Discontinued stock has been written
down to estimated realisable value. The restructuring
costs and associated impairment charges for tangible
and intangible assets are as follows:
| |
|
|
2001 |
2000 |
| |
|
|
US$'M |
US$'M |
| |
|
|
|
|
Severance payments
|
|
|
36.0
|
- |
| |
|
|
|
|
Impairment of intangible assets
|
|
|
25.2
|
- |
| |
|
|
|
|
Impairment of fixed assets
|
|
|
17.2 |
- |
| |
|
|
|
|
Write-down of discontinued stock
|
|
|
17.1 |
- |
| |
|
|
|
|
Other closure and
termination costs
|
|
|
14.9
|
- |
| |
|
|
|
|
| |
|
|
110.4 |
|
| |
|
|
|
|
|
| |
As set out in the consolidated financial statements
for the year ended 31st March 2000, the group acquired
certain assets and assumed certain liabilities from
Lucent related to their consumer telephone manufacturing
operations on 31st March 2000. The results of the
group were significantly impacted by the Lucent consumer
telephone operations which for the year ended 31st
March 2001 were included in the Consolidated Income Statement as follows:
| |
2001 |
2000 |
| |
US$'M
|
US$'M |
Turnover
|
319.8
|
- |
Cost of sales
|
(268.6)
|
- |
| |
|
|
Gross profit
|
51.2
|
- |
Selling and distribution costs
|
(87.1)
|
- |
Administrative and other operating expenses
|
(22.1)
|
- |
Research and development expenses
|
(13.5)
|
- |
Restructuring and impairment charges (*)
|
(58.1)
|
|
Recognition of negative goodwill
(**)
|
31.9
|
|
| |
|
|
Operating loss
|
(97.7)
|
- |
| |
|
|
*
Restructuring and impairment charges of US$
58.1 million are included in the total restructuring
charges of US$ 110.4 million above.
|
**The negative goodwill
arising on the acquisition of the Lucent consumer
telephone operations amounting to US$31.9 million
has been recognised as income in the Consolidated Income Statement to offset selling and distribution
costs in the amount of US$16.1 million, administrative
and other operating expenses in the amount of US$12.6
million and research and development expenses in the
amount of US$3.2 million arising from the business
acquired. |
|
2 TAXATION
| |
2001 |
2000 |
| |
US$'M |
US$'M |
| |
|
|
Current tax
|
1.6 |
1.9 |
| Deferred tax |
0.2 |
0.6 |
| |
|
|
| |
1.8 |
2.5 |
| |
|
|
|
|
|
Tax on profits has been calculated at the rates of
taxation prevailing in the countries in which the
group operates and includes a Hong Kong profits tax
charge of US$ 0.9 million (2000: US$ 3.3 million),
United Kingdom corporation tax credit of US$ 0.1 million
(2000: tax charge of US$0.4 million) and a tax charge
in the U.S.A. of US$ 1.0 million (2000: tax credit
of US$1.1million). |
|
3 DIVIDENDS
| |
2001 |
2000 |
| |
US$'M
|
US$'M |
| |
|
|
Final dividend in respect of 2000
of US 12.5 cents (1999 : US 12.5 cents) per
share
|
26.9
|
26.5 |
Interim dividend in respect of
2000 of US 5.0 cents per share
|
-
|
10.6 |
| |
|
|
| |
26.9
|
37.1 |
| |
|
|
The final dividend in 2000 was satisfied by the payment
of cash of US$10.8 million and the balance of US$16.1
million by the allotment of 5,114,154 new ordinary
shares in the company by way of scrip dividend. The
board has not recommended any dividend (2000 : US
17.5 cents per share) for the year. |
| |
|
| |
4 (LOSS) / EARNINGS PER SHARE |
| |
|
| |
The calculations of basic and diluted loss/earnings
per share are based on the group's loss attributable
to shareholders of US$ 215.0 million (2000: profit
of US$ 45.0 million).
The basic loss / earnings per share is based on the
weighted average of 222.4 million (2000: 214.3 million)
ordinary shares in issue during the year. Since diluted
loss per share is decreased when taking share options
into account, the options are anti-dilutive and are
ignored in the calculation of diluted loss per share.
Therefore, diluted loss per share in 2001 is US cents
96.7. The diluted earnings per share in 2000 was based
on 214.9 million ordinary shares which is the weighted
average number of ordinary shares in issue during
2000 after adjusting for the weighted average of 0.6
million ordinary shares deemed to be issued at no
consideration if all outstanding share options had
been exercised at 31st March 2000. |
