Asia Satellite Telecom : Announcement of Unaudited Results for the Six Months Ended 30 June 2017

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ASIA SATELLITE TELECOMMUNICATIONS HOLDINGS LIMITED

亞 洲 衛 星 控 股 有 限 公 司 *

(Incorporated in Bermuda with limited liability)

Stock Code: 1135

Announcement of Unaudited Results for the Six Months Ended 30 June 2017

The Board of Directors is pleased to announce the unaudited interim results of the Group for the six months ended 30 June 2017 as follows:

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Unaudited Six months ended 30 June
Note	2017	2016
HK$'000	HK$'000
Revenue	4	642,351	640,041
Cost of services	(314,261)	(314,646)
Gross profit	328,090	325,395
Administrative expenses	(98,215)	(63,295)
Other gains - net	5	33,354	728
Operating profit	5	263,229	262,828
Finance expenses	6	(32,291)	(20,713)
Profit before income tax	230,938	242,115
Income tax (expense)/credit	7	(51,297)	7,114
Profit and total comprehensive income for the period	179,641	249,229
Profit and total comprehensive income for the period attributable to:
- Owners of the Company	179,671	249,229
- Non-controlling interests	(30)	-
179,641	249,229
Earnings per share attributable to owners of the Company	HK$ per share	HK$ per share
Basic earnings per share	8	0.46	0.64
Diluted earnings per share	8	0.46	0.63

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Unaudited 30 June	Audited 31 December
Note	2017	2016
HK$'000	HK$'000
ASSETS
Non-current assets
Leasehold land and land use rights	17,493	17,785
Property, plant and equipment	6,720,684	6,830,436
Unbilled receivables	18,903	19,575
Deposit	10	2,851	2,851
Total non-current assets	6,759,931	6,870,647
Current assets
Unbilled receivables	6,383	9,215
Trade and other receivables	10	227,083	317,624
Cash and bank balances	497,478	240,583
Total current assets	730,944	567,422
Total assets	7,490,875	7,438,069
EQUITY
Equity attributable to owners of the Company
Share capital	39,120	39,120
Reserves
- Retained earnings	3,133,083	3,029,950
- Other reserves	31,787	35,600
3,203,990	3,104,670
Non-controlling interests	874	904
Total equity	3,204,864	3,105,574
LIABILITIES
Non-current liabilities
Bank borrowings	11	2,793,651	2,913,283
Deferred income tax liabilities	423,162	432,271
Other payable	39,000	39,000
Deferred revenue	60,616	67,215
Other amounts received in advance	-	1,377
Total non-current liabilities	3,316,429	3,453,146
Current liabilities
Bank borrowings	11	356,987	350,040
Construction payables	13,712	30,521
Dividend payable	78,239	-
Other payables and accrued expenses	68,529	68,725
Deferred revenue	363,178	173,085
Current income tax liabilities	88,937	256,978
Total current liabilities	969,582	879,349
Total liabilities	4,286,011	4,332,495
Total equity and liabilities	7,490,875	7,438,069

Notes
1.	Independent review
The unaudited condensed consolidated interim financial information of the Company and its subsidiaries for the six months ended 30 June 2017 have been reviewed by the Company's independent auditor, PricewaterhouseCoopers, in accordance with Hong Kong Standard on Review Engagements 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Hong Kong Institute of Certified Public Accountants. The auditor's independent review report will be included in the Interim Report to shareholders.

2.	Basis of preparation
This condensed consolidated interim financial information for the six months ended 30 June 2017 has been prepared in accordance with Hong Kong Accounting Standard ("HKAS") 34, "Interim financial reporting". The condensed consolidated interim financial information should be read in conjunction with the annual financial statements for the year ended 31 December 2016, which have been prepared in accordance with Hong Kong Financial Reporting Standards ("HKFRSs"). As at 30 June 2017, the Group's current liabilities exceeded its current assets by approximately HK$238,638,000 (31 December 2016: HK$311,927,000). Included in the Group's current liabilities was deferred revenue of HK$363,178,000 (31 December 2016: HK$173,085,000) which represents non-refundable customer prepayments that will be recognised as revenue over the next twelve months through provision of transponder capacity services. The Group's current assets exceeded its current liabilities excluding deferred revenue by HK$124,540,000 (31 December 2016: the Group's net current liabilities less deferred revenue was HK$138,842,000). Based on the Group's forecasts and projections, taking account of reasonably possible changes in trading performance and the available banking facilities, the directors have a reasonable expectation that the Group will have adequate resources to continue its operations and to meet its financial obligations as and when they fall due in the next twelve months from the date of this condensed consolidated interim financial information. Therefore, the Group has prepared its condensed consolidated interim financial information on a going concern basis.
3.	Accounting policies
The accounting policies applied are consistent with those of the annual financial statements for the year ended 31 December 2016, as described in those annual financial statements. There are no amendments to standards or interpretations that are effective for the first time for this interim period that could be expected to have a material impact on this Group.

Notes

3.	Accounting policies (Continued)

The following new standards, amendments to standards and interpretations have been issued, but are not effective for the financial year beginning 1 January 2017 and have not been early adopted:

HKFRS 9	Financial Instruments1
HKFRS 15	Revenue from Contracts with Customers1
HKFRS 16	Lease2
HKFRS 10 and HKAS 28 (Amendment)	Sale or Contribution of Assets between an Investor and its Associate or Joint Venture3
HK (IFRIC) 22	Foreign Currency Transactions and Advance Considerations1

1 Effective for the Group for annual periods beginning on or after 1 January 2018

2 Effective for the Group for annual periods beginning on or after 1 January 2019

3 Effective date to be determined

Management is in the process of assessing the impact of these new standards, amendments to standards and interpretation to existing standards. Below set out their expected impact the Group's financial performance and position:

(a) HKFRS 9 ''Financial instruments''

HKFRS 9 ''Financial instruments'' addresses the classification, measurement and recognition of financial assets and liabilities. The complete version of HKFRS 9 was issued in July 2014. It replaces the guidance in HKAS 39 that relates to the classification and measurement of financial instruments.

HKFRS 9 retains but simplifies the mixed measurement model and establishes three primary measurement categories for financial assets: amortised cost, fair value through other comprehensive income and fair value through profit or loss. The basis of classification depends on the entity's business model and the contractual cash flow characteristics of the financial asset. Investments in equity instruments are required to be measured at fair value with the irrevocable option at inception to present changes in fair value in other comprehensive income not recycling, provided the instrument is not held for trading. If the equity instrument is held for trading, changes in fair value are presented in profit or loss. For financial liabilities, there are two classification categories: amortised cost and fair value through profit or loss. Where non derivative financial liabilities are designated at fair value through profit or loss, the changes in the fair value due to changes in the liability's own credit risk are recognised in the other comprehensive income, unless such changes in fair value would create an accounting mismatch in profit or loss, in which case, all fair value movements are recognised in profit or loss. There is now a new expected credit losses model that replaces the incurred loss impairment model used in HKAS 39.

HKFRS 9 relaxes the requirements for hedge effectiveness by replacing the bright line hedge effectiveness tests. It requires an economic relationship between the hedged item and hedging instrument and the ''hedged ratio'' to be the same as that used by management for risk management purposes. Contemporaneous documentation is still required but is different to that currently prepared under HKAS 39.