3rd Quarter Results

RNS Number : 8217U

Hongkong Land Hldgs Ld

21 October 2010

 



To:   Business Editor                                                                 25th October 2010

                                                                                                For immediate release

 

MCL Land Limited

Third Quarter 2010 Financial Statements and Dividend Announcement

The following announcement was issued today by the Company's 78%-owned subsidiary, MCL Land Limited.

For further information, please contact:

Hongkong Land Limited

John R Witt                                                                                           (852) 2842 8101

GolinHarris

Sue So                                                                                                  (852) 2501 7984

25th October 2010

MCL LAND LIMITED

THIRD QUARTER 2010 FINANCIAL STATEMENTS AND DIVIDEND ANNOUNCEMENT

Highlights

·     Completion of Waterfall Gardens and D'Pavilion

·     Reversal of write-down on The Estuary

·     Profit attributable to shareholders at US$172 million

·     Delisting proposal to be put to stockholders

"Following the implementation of new policy measures by the government to dampen the market, residential sales in Singapore are expected to moderate with overall sentiment becoming more cautious. The Group's next project to be completed will be the 180 units at The Peak@Balmeg, which is expected in the second quarter of 2011."

Y K Pang, Chairman

25th October 2010

Group Results

				Nine months ended 30th September
				2010	2009	Change	2010	Change
				US$m	US$m	%	S$m	%
Revenue				362.2	421.8	-14	504.0	-16
Profit before tax				194.4	161.6	20	272.1	18
Profit attributable to shareholders				171.8	134.5	28	240.5	25
				US¢	US¢		S¢
Earnings per share				46.42	36.35	28	64.99	25
				At 30.9.2010	At 31.12.2009	Change	At 30.9.2010	Change
				US$m	US$m	%	S$m	%
Shareholders' funds				716.5	533.2	34	943.6	26
				US$	US$		S$
Net asset value per share				1.94	1.44	35	2.55	26

The exchange rate of US$1=S$1.32 (31.12.2009: US$1=S$1.40) was used for translating assets and liabilities at the balance sheet date. Average monthly transaction rates were used for translating the results for the financial period (average rate for 2010: US$1=S$1.38; 2009: US$1=S$1.47).

The financial results for the nine months ended 30th September 2010 and 30th September 2009 have been prepared based on International Financial Reporting Standards ("IFRS"). The financial information is extracted from the Condensed Interim Financial Information for the nine months ended 30th September 2010 that has been reviewed in accordance with Singapore Standard on Review Engagements 2410, Review of Interim Financial Information performed by the Independent Auditor of the Company and its subsidiaries.

The financial results for the nine months ended 30th September 2010 of the Company and its subsidiaries have been reported on in accordance with the Singapore Code on Take-overs and Mergers.

The Independent Auditor's Review Report dated 25th October 2010 on the Condensed Interim Financial Information of the Company and its subsidiaries for the nine months ended 30th September 2010 is attached in Appendix 1.

The Independent Financial Adviser's Review Report dated 25th October 2010 on the Condensed Interim Financial Information of the Company and its subsidiaries for the nine months ended 30th September 2010 is attached in Appendix 2.

Overview

Market conditions have remained satisfactory in the third quarter of the year due to the positive economic conditions. The implementation of recent government policies on 30th August 2010 has, however, moderated demand and price expectations in the residential property market.

Group Performance

MCL Land recorded revenue of US$362 million in the first nine months of 2010, primarily due to the recognition of sales on the completion of Waterfall Gardens and D'Pavilion. In the corresponding period in 2009, revenue of US$422 million came from the completion of three development projects. Profit attributable to shareholders for the period was US$172 million, compared with US$135 million in 2009. In addition to the profit arising from the completion of Waterfall Gardens and D'Pavilion, the results also include a US$51 million reversal of a write-down on The Estuary development. The Group continues to carry a write-down of US$143 million against a number of its development properties in Singapore.

Shareholders' funds were US$717 million at 30th September 2010, up from US$533 million at 31st December 2009. While the Group continued to receive progress payments in respect of its development projects, it completed the acquisition of a new development site at Hougang Avenue 2 in August 2010 for a consideration of US$148 million. As a result, the Group's net cash position had decreased to US$151 million at 30th September 2010, compared with US$279 million at 30th June 2010.

The Board is not recommending the payment of an interim dividend for the first nine months of 2010 (2009: nil).

Proposed Voluntary Delisting

On 26th August 2010, it was announced that the Company had received a proposal from HKL (MCL) Pte Ltd, a wholly-owned subsidiary of Hongkong Land Holdings Limited, to seek the voluntary delisting of the Company from the Official List of the Singapore Exchange Securities Trading Limited. Under the terms of the proposal, HKL (MCL) will make a cash offer to acquire all the stock units of the Company it does not already own at the price of S$2.45 each.

In view of the low free float and level of trading activity in the stock units, together with the lack of need for the Company to seek to raise equity capital through new stock issuance, the delisting would allow the Company to dispense with expenses relating to the maintenance of a listed status and focus its resources on its business operations. The cash offer by HKL (MCL) also presents stockholders with an opportunity to realise their entire stockholding at an attractive premium.

A circular to stockholders providing full details of the rationale for the delisting and of the cash offer, together with the advice of the independent financial adviser and the recommendation of the Independent Directors, will be sent to stockholders shortly. The delisting proposal is subject to the approval of stockholders at an Extraordinary General Meeting expected to be held on 23rd November 2010. HKL (MCL), which owns 78.3% of the stock units, has confirmed that it intends to vote in favour of the proposal, and the Employees Provident Fund Board of Malaysia, which owns 4.7% of the stock units, has also undertaken to vote in favour of the proposal and accept the cash offer.

Properties

In May 2010, Waterfall Gardens, a fully sold 132-unit condominium development at Farrer Road, was completed. During the third quarter, the D'Pavilion project on Upper Serangoon Road was completed with the Temporary Occupation Permit received in September. Of the 50 apartments, 96% had been sold as at the end of September.

Selling activities continued at the other projects of the Group which had previously been launched. Pre-sales had reached 99% at Parvis, a 248-unit condominium joint venture development at Holland Road, and 35% at D'Mira, a 65-unit apartment development at Boon Teck Road. Units at The Estuary, a 608-unit condominium development at Yishun Avenue 1, and The Peak@Balmeg, a 180-unit condominium development at Balmeg Road, have been fully sold.

Construction of the Group's development projects is progressing well. The Peak@Balmeg is scheduled to complete in 2011, followed by Parvis in 2012, and D'Mira and The Estuary in 2013. The Group has five other development properties in Singapore with a total gross floor area of about 100,000 square metres which are at various stages of planning approval. These properties have not yet been launched.

The Group's joint venture developments in Malaysia continued to perform satisfactorily.  Phase 1 of Riana Green was completed in January 2010, and all 391 units have now been sold. In Phase T3A of Seremban Forest Heights, a joint venture development in Seremban, 153 units were launched in August 2010 with 17 units committed for sale at the end of September. In the various phases in Seremban Forest Heights, out of the 521 units available for sale, 346 units have been pre-committed.

Wangsa Walk, a joint venture retail mall development in Kuala Lumpur with an estimated net lettable area of some 25,000 square metres, had 95% of its space leased at the end of September 2010.

Prospects

Following the implementation of new policy measures by the government to dampen the market, residential sales in Singapore are expected to moderate with overall sentiment becoming more cautious. The Group's next project to be completed will be the 180 units at The Peak@Balmeg, which is expected in the second quarter of 2011.

Y K Pang

Chairman

25th October 2010

Statement pursuant to Rule 705(5) of the Listing Manual

The Directors confirm that, to the best of their knowledge, nothing has come to the attention of the Board of Directors which may render the accompanying unaudited interim financial results for the nine months ended 30th September 2010 to be false or misleading in any material respect.

On behalf of the Directors

Y K Pang

Chairman

Hassan Abas

Director

25th October 2010

The Directors of MCL Land (including any Director who may have delegated detailed supervision of this Announcement) have taken all reasonable care to ensure that the facts stated and opinions expressed in this Announcement are fair and accurate and that no material facts have been omitted from this Announcement, and they jointly and severally accept responsibility accordingly.

MCL Land Limited
Consolidated Profit and Loss Account
			Three months ended					Nine months ended
			30.9.2010		30.9.2009	Change		30.9.2010		30.9.2009	Change
		Note	US$'000		US$'000	%		US$'000		US$'000	%
Revenue			46,575		277,680	- 83		362,160		421,783	- 14
Cost of sales			(34,357)		(155,718)	- 78		(211,078)		(253,335)	- 17
Gross profit			12,218		121,962	- 90		151,082		168,448	- 10
Other income		3	259		196	32		51,934		911	n/m
Marketing expenses			(424)		(803)	- 47		(3,474)		(973)	257
Administrative expenses			(1,650)		(3,785)	- 56		(4,573)		(5,888)	- 22
Share of joint ventures' results (net of tax)			(38)		(309)	- 88		(547)		(885)	- 38
Profit before tax		2	10,365		117,261	- 91		194,422		161,613	20
Tax		4	(1,521)		(20,855)	- 93		(22,661)		(27,125)	- 16
Profit after tax attributable to
	shareholders of the Company		8,844		96,406	- 91		171,761		134,488	28
			US¢		US¢	%		US¢		US¢	%
Earnings per share ("EPS")
	attributable to shareholders
	- basic and diluted*	5	2.39		26.06	- 91		46.42		36.35	28
n/m = not meaningful
*	Diluted EPS is the same as basic EPS, as there were no outstanding, dilutive potential ordinary shares.

MCL Land Limited
Consolidated Statements of Comprehensive Income and Changes in Equity
for the three months ended 30th September
Consolidated Statement of Comprehensive Income for the three months ended 30th September
			2010		2009
			US$'000		US$'000
Profit after tax			8,844		96,406
Other comprehensive income:
	Translation difference		43,412		9,551
Total comprehensive income attributable to
	shareholders of the Company		52,256		105,957
Consolidated Statement of Changes in Equity for the three months ended 30th September
		Attributable to shareholders
		Share	Translation	Retained	Total
		capital	reserve	earnings	equity
		US$'000	US$'000	US$'000	US$'000
2010
Balance at 1st July		276,657	121,552	266,018	664,227
Total comprehensive income for the financial period		-	43,412	8,844	52,256
Balance at 30th September		276,657	164,964	274,862	716,483
2009
Balance at 1st July		276,657	106,605	20,498	403,760
Total comprehensive income for the financial period		-	9,551	96,406	105,957
Balance at 30th September		276,657	116,156	116,904	509,717
The number of issued ordinary shares as at 30th September 2010 was 369,985,977 (2009: 369,985,977). The Company did not hold any treasury shares as at 30th September 2010 and 2009.

MCL Land Limited
Consolidated Statements of Comprehensive Income and Changes in Equity
for the nine months ended 30th September
Consolidated Statement of Comprehensive Income for the nine months ended 30th September
			2010		2009
			US$'000		US$'000
Profit after tax			171,761		134,488
Other comprehensive income:
	Translation difference		44,460		6,773
Total comprehensive income attributable to
	shareholders of the Company		216,221		141,261
Consolidated Statement of Changes in Equity for the nine months ended 30th September
		Attributable to shareholders
		Share	Translation	Retained	Total
		capital	reserve	earnings	equity
		US$'000	US$'000	US$'000	US$'000
2010
Balance at 1st January		276,657	120,504	136,067	533,228
Total comprehensive income for the financial period		-	44,460	171,761	216,221
Dividend		-	-	(32,966)	(32,966)
Balance at 30th September		276,657	164,964	274,862	716,483
2009
Balance at 1st January		276,657	109,383	7,909	393,949
Total comprehensive income for the financial period		-	6,773	134,488	141,261
Dividend		-	-	(25,493)	(25,493)
Balance at 30th September		276,657	116,156	116,904	509,717
The number of issued ordinary shares as at 30th September 2010 was 369,985,977 (2009: 369,985,977). The Company did not hold any treasury shares as at 30th September 2010 and 2009.

MCL Land Limited
Consolidated Balance Sheet
				At		At
				30.9.2010		31.12.2009
		Note		US$'000		US$'000
Non-current assets 1
Plant and equipment				297		346
Investment properties				16,891		15,382
Investments in joint ventures				29,936		30,317
Deferred tax assets				942		690
				48,066		46,735
Current assets 2
Development properties for sale				657,610		543,409
Amounts owing by joint ventures				70,220		72,466
Debtors and prepayments				78,594		67,534
Bank balances				197,840		192,464
				1,004,264		875,873
Total assets				1,052,330		922,608
Non-current liabilities 3
Borrowings		6		46,765		90,194
Deferred tax liabilities				5		270
Creditors				3,743		7,254
				50,513		97,718
Current liabilities 4
Borrowings		6		-		9,550
Amounts owing to joint venture				-		482
Creditors				260,659		249,038
Current tax liabilities				24,675		32,592
				285,334		291,662
Total liabilities				335,847		389,380
Net assets				716,483		533,228
Equity:
Share capital and reserves
Share capital				276,657		276,657
Translation reserve				164,964		120,504
Retained earnings				274,862		136,067
Shareholders' funds				716,483		533,228
Net asset value per share				US$1.94		US$1.44
Explanatory notes on material variances:
1	The increase in non-current assets at 30.9.2010 as compared to 31.12.2009 was mainly due to translation difference arising from the Group's investment properties. This was partially offset by the Group's share of losses incurred by its joint ventures.
2	The increase in current assets resulted from the acquisition of the development site at Hougang Avenue 2, partially offset by the completion of Waterfall Gardens and D'Pavilion. In addition, outstanding progress billings and sales proceeds collected from the Group's development properties resulted in higher debtors and bank balances, respectively.
3	The lower non-current liabilities at 30.9.2010 as compared to 31.12.2009 was due to the repayment of long-term bank loans during the financial period from progress billings collected in respect of the Group's development properties.
4	The lower current liabilities at 30.9.2010 as compared to 31.12.2009 resulted from the repayment of short-term bank loans and payment of income tax during the financial period. This was partially offset by an increase in amounts owing to creditors for the construction of the Group's development properties.

MCL Land Limited
Company Balance Sheet
		At		At
		30.9.2010		31.12.2009
		US$'000		US$'000
Non-current assets
Plant and equipment		278		325
Interests in subsidiaries		61,329		57,561
Investments in joint ventures		28,668		28,482
		90,275		86,368
Current assets
Amounts owing by subsidiaries		481,473		273,493
Amounts owing by joint ventures		70,220		72,466
Debtors and prepayments		279		318
Bank balances		95,488		135,281
		647,460		481,558
Total assets		737,735		567,926
Current liabilities
Amounts owing to subsidiaries		249,425		126,061
Amounts owing to joint venture		-		482
Creditors		3,700		3,734
Current tax liabilities		-		721
		253,125		130,998
Total liabilities		253,125		130,998
Net assets		484,610		436,928
Equity:
Share capital and reserves
Share capital		276,657		276,657
Translation reserve		132,332		102,236
Retained earnings		75,621		58,035
Shareholders' funds		484,610		436,928
Net asset value per share		US$1.31		US$1.18

MCL Land Limited
Company Statements of Comprehensive Income and Changes in Equity
for the three months ended 30th September
Company Statement of Comprehensive Income for the three months ended 30th September
				2010			2009
				US$'000			US$'000
Loss after tax				(6,958)			(12,672)
Other comprehensive income:
	Translation difference			30,210			8,945
Total comprehensive income/(loss) attributable to
	shareholders of the Company			23,252			(3,727)
Company Statement of Changes in Equity for the three months ended 30th September
			Attributable to shareholders
						Retained
						earnings/
			Share		Translation	(Accumulated	Total
			capital		reserve	loss)	equity
			US$'000		US$'000	US$'000	US$'000
2010
Balance at 1st July			276,657		102,122	82,579	461,358
Total comprehensive income for the financial period			-		30,210	(6,958)	23,252
Balance at 30th September			276,657		132,332	75,621	484,610
2009
Balance at 1st July			276,657		90,169	4,576	371,402
Total comprehensive loss for the financial period			-		8,945	(12,672)	(3,727)
Balance at 30th September			276,657		99,114	(8,096)	367,675

MCL Land Limited
Company Statements of Comprehensive Income and Changes in Equity
for the nine months ended 30th September
Company Statement of Comprehensive Income for the nine months ended 30th September
			2010		2009
			US$'000		US$'000
Profit/(Loss) after tax			50,552		(87,418)
Other comprehensive income:
	Translation difference		30,096		3,066
Total comprehensive income/(loss) attributable to
	shareholders of the Company		80,648		(84,352)
Company Statement of Changes in Equity for the nine months ended 30th September
		Attributable to shareholders
				Retained
				earnings/
		Share	Translation	(Accumulated	Total
		capital	reserve	loss)	equity
		US$'000	US$'000	US$'000	US$'000
2010
Balance at 1st January		276,657	102,236	58,035	436,928
Total comprehensive income for the financial period		-	30,096	50,552	80,648
Dividend		-	-	(32,966)	(32,966)
Balance at 30th September		276,657	132,332	75,621	484,610
2009
Balance at 1st January		276,657	96,048	104,815	477,520
Total comprehensive loss for the financial period		-	3,066	(87,418)	(84,352)
Dividend		-	-	(25,493)	(25,493)
Balance at 30th September		276,657	99,114	(8,096)	367,675

MCL Land Limited
Consolidated Statement of Cash Flows
								Three months ended						Nine months ended
								30.9.2010				30.9.2009		30.9.2010				30.9.2009
						Note		US$'000				US$'000		US$'000				US$'000
Profit before tax								10,365				117,261		194,422				161,613
Non-cash items
	Interest income							(255)				(177)		(779)				(722)
	Share of joint ventures’ results							38				309		547				885
	Depreciation							22				26		70				98
	Reversal of write-down on development properties for sale					3		-				-		(50,897)				-
	(Profit)/Loss on disposal of plant and equipment							-				-		(22)				1
	Unrealised translation (gain)/loss							(1)				(2)		2				(4)
								(196)				156		(51,079)				258
Operating profit before working capital changes								10,169				117,417		143,343				161,871
Changes in working capital
		Development properties for sale						(173,529)				115,044		(27,859)				160,271
		Amounts owing by joint ventures						27				(785)		6,563				(897)
		Debtors and prepayments						45,373				(121,780)		(3,856)				(97,077)
		Creditors						(7,511)				(87,879)		(7,950)				(86,776)
								(135,640)				(95,400)		(33,102)				(24,479)
Cash flows (used in)/generated from operations								(125,471)				22,017		110,241				137,392
		Interest received						275				175		627				732
		Income tax paid						(16,986)				(7,589)		(32,892)				15,723
								(16,711)				(7,414)		(32,265)				(14,991)
		Net cash flows (used in)/generated from operating activities 5						(142,182)				14,603		77,976				122,401
Cash flows from investing activities
		Purchase of plant and equipment						(31)				(16)		(38)				(22)
		Net proceeds from sale of plant and equipment						-				-		57				-
		Proceeds from joint venture on capital reduction						1,261				-		1,261				-
		Net cash flows generated from/(used in) investing activities						1,230				(16)		1,280				(22)
Cash flows from financing activities
		Drawdown of loans						-				5,615		-				57,269
		Repayment of loans						(41,188)				(80,150)		(57,894)				(170,489)
		Dividend paid						-				-		(32,966)				(25,493)
		Net cash flows used in financing activities 6						(41,188)				(74,535)		(90,860)				(138,713)
Net change in cash and cash equivalents								(182,140)				(59,948)		(11,604)				(16,334)
Cash and cash equivalents at the beginning of the
		financial period						361,739				173,200		192,464				131,800
Effect of exchange rate changes								18,241				3,397		16,980				1,183
Cash and cash equivalents at the end of the financial period								197,840				116,649		197,840				116,649
Explanatory notes on material variances:
		5	The net cash flows generated from operating activities for the nine months ended 30th September 2010 mainly related to the collection of progress payments upon the completion of Waterfall Gardens and D'Pavilion, partially offset by payment of income tax.
		6	The net cash flows used in financing activities for the nine months ended 30th September 2010 mainly related to the repayment of bank loans from progress billings collected and the payment of dividends on 26th May 2010.

 

MCL Land Limited
Notes
1	Accounting policies and basis of preparation
	The financial statements contained in this announcement are prepared in accordance with the accounting policies and methods of computation set out in the 2009 audited accounts, which are based on International Financial Reporting Standards ("IFRS").  There have been no changes to the accounting policies described in the 2009 annual financial statements except for the adoption of the amendments and interpretations set out below:
	Amendment to IAS 39		Eligible Hedged Items
	Improvements to IFRSs (2009)
	IFRIC 17		Distributions of Non-cash Assets to Owners
	The adoption of these amendments and interpretations do not have any significant impact on the results of the Group.
2	Profit
					Group
					Three months ended					Nine months ended
					30.9.2010		30.9.2009	Change		30.9.2010			30.9.2009	Change
					US$'000		US$'000	%		US$'000			US$'000	%
	Profit before tax is determined
		after including:
	Reversal of write-down on development
		properties for sale (Note 3)			-		-	-		50,897			-	n/m
	Net exchange gain/(loss)				-		(1)	- 100		26			(1)	n/m
	Rental income				219		265	- 17		668			810	- 18
	Interest income				255		177	44		779			722	8
	Depreciation on plant and equipment				(22)		(26)	- 15		(70)			(98)	- 29
	Profit/(Loss) on disposal of plant and equipment				-		-	-		22			(1)	n/m
	n/m = not meaningful
3	Other income
	Included in the income for the nine months ended 30th September 2010 is a reversal of a US$50,897,000 (2009: nil) write-down previously made on the Group's development properties for sale.
4	Tax
	The provision for income tax is based on the statutory tax rates prevailing in the respective countries in which Group companies operate after taking into account expenses which are not tax deductible, income not subject to tax and Group tax relief.

5	Earnings per share *
				Group
				Three months ended				Nine months ended
				30.9.2010		30.9.2009		30.9.2010			30.9.2009
	Basic earnings per share*
	Profit attributable to shareholders (US$'000)			8,844		96,406		171,761			134,488
	Weighted average number of ordinary shares
		in issue ('000)		369,986		369,986		369,986			369,986
	Basic earnings per share (US¢)			2.39		26.06		46.42			36.35
	*	Diluted EPS is the same as basic EPS, as there were no outstanding, dilutive potential ordinary shares.
6	Group borrowings
								Group
								At			At
								30.9.2010			31.12.2009
								US$'000			US$'000
	Borrowings due within one year
		- secured						-			9,550
	Borrowings due after one year
		- secured						46,765			90,194
								46,765			99,744
	Certain subsidiaries of the Company have mortgaged their development properties as security for bank loans. The net book value of properties mortgaged as at 30th September 2010 was US$250.7 million (31st December 2009: US$289.9 million).
7	Interested person transactions
		Name of interested person		Aggregate value of all interested person transactions (excluding transactions less than S$100,000 and transactions conducted under the shareholders’ mandate pursuant to Rule 920)				Aggregate value of interested person transactions conducted under shareholders’ mandate pursuant to Rule 920 (excluding transactions less than S$100,000)
				US$'000				US$'000
		Three months ended 30th September 2010
		Jardine OneSolution (2001) Pte Ltd
		- IT Infrastructure		-				151
		Nine months ended 30th September 2010
		Jardine OneSolution (2001) Pte Ltd
		- IT Infrastructure		-				151

 

8	Issue of shares
	There have been no changes in the issued share capital of the Company since 31st December 2009.
	There are no outstanding convertibles issued or treasury shares held by the Company as at 30th September 2010.
	The total number of issued share capital (excluding treasury shares) as at 30th September 2010 and 31st December 2009 was 369,985,977.
9	Others
	The results do not include any pre-acquisition profits and have not been affected by any item, transaction or event of a material and unusual nature. No significant transaction or event has occurred between 30th September 2010 and the date of this report.

- end - 

For further information, please contact:

Joyce Chang

Company Secretary

MCL Land Limited

Tel: [phone]

Full text of the Financial Statements and Dividend Announcement for the nine months ended 30th September 2010 can be accessed through the internet at www.mclland.com.sg.

Appendix 1

The Board of Directors

MCL Land Limited

78 Shenton Way

Singapore 079120

25 October 2010

MCL LAND LIMITED AND ITS SUBSIDIARIES INDEPENDENT AUDITOR'S REVIEW REPORT FOR THE NINE MONTHS ENDED 30TH SEPTEMBER 2010

 

We have reviewed the Condensed Interim Financial Information of MCL Land Limited (the "Company") and its subsidiaries (together the "Group") set out on pages 2 to 15* which comprises the interim balance sheets of the Company and the Group as at 30th September 2010 and the related interim consolidated profit and loss account of the Group, the interim statements of comprehensive income of the Group and changes in equity of the Company and of the Group and the interim consolidated statement of cash flows of the Group for the nine months then ended.

Management is responsible for the preparation and presentation of this Condensed Interim Financial Information in accordance with International Accounting Standard - IAS 34, 'Interim Financial Reporting'. Our responsibility is to express a conclusion on this Condensed Interim Financial Information based on our review.

Scope of Review

We conducted our review in accordance with Singapore Standard on Review Engagements 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of the Condensed Interim Financial Information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Singapore Standards of Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the Condensed Interim Financial Information is not prepared, in all material respects, in accordance with IAS 34.

Restriction On Use

Our report is provided on the basis that it is solely for the information of the directors of the Company to enable the directors of the company to fulfill their responsibilities under Rule 25 of the Singapore Code on Take-overs and Mergers and the requirements of the Listing Rules of the Singapore Exchange Securities Trading Limited.

PricewaterhouseCoopers LLP

Public Accountants and Certified Public Accountants

Singapore

25th October 2010

* The page numbers stated above refers to the relevant pages in MCL Land Limited and its subsidiaries Condensed Interim Financial Information dated 25th October 2010 for the nine months ended 30th September 2010.

Appendix 2

25 October 2010

MCL Land Limited

78 Shenton Way,

#33-00,

Singapore 079120

Dear Sirs,

MCL LAND LIMITED

EXIT OFFER BY HKL (MCL) PTE. LTD. ("THE OFFEROR" OR "HKL (MCL)") TO ACQUIRE ALL THE ISSUED ORDINARY STOCK UNITS IN THE CAPITAL OF MCL LAND LIMITED (THE "COMPANY" OR "MCL LAND") OTHER THAN THOSE ALREADY OWNED BY THE OFFEROR, ITS RELATED CORPORATIONS AND THEIR RESPECTIVE NOMINEES IN CONNECTION WITH THE PROPOSED VOLUNTARY DELISTING OF THE COMPANY

On 26 August 2010, the Offeror, an indirect wholly-owned subsidiary of Hongkong Land Holdings Limited, and MCL Land jointly announced that the Board of directors of the Company has received a proposal (the "Delisting Proposal") from the Offeror to seek the voluntary delisting of the Company from the Official List of the Singapore Exchange Securities Trading Limited pursuant to Rules 1307 and 1309 of the SGX-ST Listing Manual.

Pursuant to the Delisting Proposal, the Offeror will make an exit offer to acquire all the issued ordinary stock units ("Stock Units") in the capital of the Company, other than those held by the Offeror, its related corporations and their respective nominees ("Offer Stock Units") at S$2.45 in cash for each Offer Stock Unit.

On 25 October 2010, the Company announced its unaudited consolidated financial statements for the nine-month period ended 30 September 2010 (the "3Q2010 Results"). We have examined the 3Q2010 Results and have discussed the same with the management of the Company who are responsible for their preparation.  We have also considered the report by PricewaterhouseCoopers LLP (the Company's auditors) dated 25 October 2010 on their review of the 3Q2010 Results.

For the purpose of this letter, we have relied on and assumed the accuracy and completeness of all information provided to us by the Company. Save as provided in this letter, we do not express any other opinion or views on the 3Q2010 Results. The Board of Directors of the Company remains solely responsible for the 3Q2010 Results.

Based on the above, we are of the opinion that the 3Q2010 Results have been prepared by the Company after due and careful inquiry.

This letter is provided to the Board of Directors of the Company solely for the purpose of complying with Rule 25 of the Singapore Code on Take-overs and Mergers and not for any other purpose.  We do not accept any responsibility to any person(s), other than the Board of Directors of the Company, in respect of, arising out of, or in connection with this letter.

Yours faithfully

For and on behalf of

CIMB BANK BERHAD, SINGAPORE BRANCH

JASON CHIAN SIET HENG	JONATHAN SIOW THIEN SOONG
DIRECTOR	VICE PRESIDENT
CORPORATE FINANCE	CORPORATE FINANCE

 

END

 

 

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