Hong Fok Corp suffers a $2.1m loss in 3Q

Revenue was down to $14m from $14.4m.

Hong Fok Corp’s revenue for 3Q decreased marginally from approximately $14.4m to $14.0m.

This was mainly due to the decrease in property management income which was partially offset by an increase in rental income from the leasing of the residential units of Concourse Skyline.

The decrease in other income was mainly due to lower interest income from cash and cash equivalents.

There was an increase in tax expense for the current period as certain expenses incurred are not deductible for tax purposes and losses incurred by certain group companies cannot be offset against profits made by other group companies.

In the previous period, the Group disposed of its shares in Winfoong International Limited, resulting in a net gain on disposal of approximately $81.9m.

With the absence of this significant gain, the Group recorded a loss of approximately $2.1m as compared to a profit of approximately $80.6m in the previous period.

The increase in pledged bank deposits was mainly due to the monies collected from the rental of its investment properties in Hong Kong.

The decrease in other assets was mainly due to the disposal of the equity securities held for trading. The decrease in current tax assets was mainly due to tax refunds from the relevant tax authority.

The Group recorded a decrease in cash and cash equivalents due mainly to payment of construction costs for YOTEL Singapore, payment of dividends and repayment of certain loans and borrowings in Hong Kong for the period January to September 2016.

The decrease in secured loans and borrowings (non-current) was mainly due to the repayment of certain loans and borrowings in Hong Kong in the third quarter of 2016.

The increase in unsecured loans and borrowings (non-current) was mainly due to the issuance of its 2.75% unsecured bonds by a subsidiary in Hong Kong to third parties in March and April 2016.

The increase in current tax liabilities was due mainly to the provision of tax expense during the period.