CITY DEVELOPMENTS LIMITED ANNUAL REPORT 2021 FINANCIALS 164 165 NOTES TO THE FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2021 YEAR ENDED 31 DECEMBER 2021 9 INVESTMENTS IN AND BALANCES WITH JOINT VENTURES Group Company 2021 2020 2021 2020 $’000 $’000 $’000 $’000 Investments in joint ventures Investments in joint ventures 1,037,046 1,891,659 37,360 37,360 Impairment loss – (806,371) – – 1,037,046 1,085,288 37,360 37,360 Balances with joint ventures Amounts owing by joint ventures: – trade 2,714 2,943 35 61 – non-trade, interest-bearing 831,736 986,742 – – – non-trade, interest-free 458,736 762,286 236,614 234,795 1,293,186 1,751,971 236,649 234,856 Impairment losses (4,431) (328,595) (5,050) (5,050) 1,288,755 1,423,376 231,599 229,806 Receivable: – Within 1 year 15 1,288,755 1,328,040 231,599 229,806 – After 1 year 11 – 95,336 – – 1,288,755 1,423,376 231,599 229,806 Amounts owing to joint ventures payable within 1 year: – trade 332 331 – – – non-trade, interest-free 97,570 346,756 22,727 22,727 30 97,902 347,087 22,727 22,727 (a) At the reporting date, included in the carrying amount of the Group’s investments in joint ventures is goodwill amounting to $28.4 million (2020: $30.4 million) relating to the Group’s interests in two (2020: four) joint ventures. The carrying amount as at 31 December 2020 included goodwill and the related impairment loss recognised during 2020 associated with the Group’s investment in HCP Chongqing Property Development Co., Ltd (“HCP”). The Group’s investment in HCP was disposed of during 2021. Details on the investment in HCP is set out under “Material joint venture” below. (b) The movement in impairment losses in respect of investments in joint ventures are as follows: Group Company 2021 2020 2021 2020 $’000 $’000 $’000 $’000 At 1 January 806,371 – – – Impairment loss recognised – 806,371 – – Impairment loss utilised (806,371) – – – At 31 December – 806,371 – – The impairment loss recognised during 2020 related to the impairment loss recognised on the investment in HCP. Details are set out under “Material joint venture” below. Impairment loss recognised was included in “Share of after-tax profit/(loss) of joint ventures” in the consolidated statement of profit or loss. 9 INVESTMENTS IN AND BALANCES WITH JOINT VENTURES (CONT’D) (c) The non-trade amounts owing by joint ventures are unsecured. In respect of interest-bearing amounts owing by joint ventures, interest at rates ranging from 0.99% to 7.5% (2020: 0.06% to 10.0%) per annum were charged by the Group. The non-trade amounts presented as receivable within one year are receivable on demand. The non-trade amount owing by a joint venture after one year was a loan to a joint venture for which settlement was neither planned nor likely to occur in the foreseeable future. As at 31 December 2020, included in the amounts owing by joint ventures was an amount of $359.7 million (net of impairment losses) due from HCP and its subsidiaries (“HCP Group”). Further details are set out under “Investment in and balances with HCP Group – Impairment of amounts owing by HCP Group” below. Following the Group’s disposal of its investment in HCP during 2021, as at 31 December 2021, the amounts owing by HCP Group have been classified as other receivables (note 15). (d) The movements in impairment losses in respect of balances with joint ventures are as follows: Group Company Lifetime ECL Lifetime ECL Note 2021 2020 2021 2020 $’000 $’000 $’000 $’000 At 1 January 328,595 4,431 5,050 5,050 Impairment loss recognised 6,104 323,942 – – Impairment loss utilised (8,153) – – – Reclassified to other receivables 41 (329,481) – – – Translation differences on consolidation 7,366 222 – – At 31 December 4,431 328,595 5,050 5,050 The impairment loss recognised by the Group during the year and 2020 relates to the impairment loss recognised on the amounts owing by HCP Group. Impairment losses recognised were included on the face of consolidated statement of profit or loss. Details are set out under “Material joint venture” below. (e) The non-trade amounts owing to joint ventures are unsecured and repayable on demand. As at 31 December 2020, included in the amounts owing to joint ventures was an amount of $264.3 million owing to HCP Group. Material joint venture As at 31 December 2021, the Group has no material joint venture. In 2020, the Group’s material joint venture related to HCP. As at 31 December 2020, the Group’s investment in HCP was fully impaired. HCP was disposed of during 2021 for an aggregate consideration of US$1. HCP was an unlisted joint venture in which the Group had joint control via an investor rights agreement and a 63.75% ownership interest. HCP, which is incorporated in Cayman Islands, is an investment holding company that holds an indirect 80.01% equity interest in Chongqing Sincere Yuanchuang Industrial Co., Ltd (“Sincere Property”) and its subsidiaries (“Sincere Property Group”), a real estate developer in the People’s Republic of China (PRC). As at 31 December 2020, approximately 13.1% and 48.9% of the shares held by HCP Group in Sincere Property Group were pledged to the Group and other parties, respectively. This investment offered the Group the opportunity to partner with Sincere Property Group and to acquire a meaningful stake in platform which would allow a sizeable expansion of the Group’s footprint in the PRC.
RkJQdWJsaXNoZXIy ODIwNTc=