The Company and its subsidiaries (The "Group") announced the interim results for the six months ended 30 June, 2008. The net loss was HKD11,255,189 (2007: the profit of HKD302,278). The net asset value per share of the Group was HKD0.308 (2007: HKD0.294). The Board does not recommend the payment of an interim dividend for the six months ended 30 June 2008.
China Property Development (Holdings) Ltd. ("CPDH"), one of the major investments of New Capital, has completed the sale of Beijing Richmond Park Project in December 2007 and generated an IRR return of over 24% for CPDH's investment in the project. In March and April 2008, the Group received dividend income distribution from CPDH of about USD13.37 million. The income will strengthen New Capital's position in pursing its strategic plan and improving returns.
Beijing Far East Instrument Co., Ltd. ("Bejing Far East") is a leading industrial precision instrument manufacturer in China. Based on the unaudited management accounts as at 30 June 2008, the revenue of Beijing Far East increased by 69% to Rmb213 million as compared to the same period last year. Its half-year profit before adjustment reached Rmb8.8 million, as compared to Rmb9.3 million for the year 2007.
New Capital has been holding two retail floors of Wuhan Xing Cheng Building since early 2007. The acquisition has provided the Group a guaranteed rental income of 8% per annum. The valuation of the retail floors appreciates in June 2008 due to the general increase of retail property market in the region. New Capital will seek to capture market opportunities to realize profit of the investment.
The recent fall of the Hang Seng Index is to a large extent affected by the correction in China's stock market and the weakening of the global economy. The market speculates that the Chinese Government will intervene in the domestic stock market in the short to medium term which may help to stabilize the Hong Kong market. With strong fundamentals, the outlook for China's economy continues to be positive. This also helps to underpin the Hong Kong economy to withstand any effect of a potential global correction. In Hong Kong, the negative real interest rate, robust retail consumption and healthy economic prospects will make HSI attractive for investments. The Group will continue to monitor the stock market for suitable opportunities.
The double-digit GDP growth shows that China's economy is growing at a steady and relatively fast pace. With tightening of the credit system and high interest rate, Chinese companies are posed to seek foreign capital to support their growing capital needs. The Group will continue to take advantage of the environment to seek new investment opportunities with attractive returns to shareholders. Looking forward, the Board is confident with the future prospects of the Group.