Investments weigh heavy in e-New loss
Digital transaction solutions provider e-New Media has reported a net loss of HK$204.56 million for last year, mainly due to provisions for a fall in the value of securities and property investments.
Year-on-year comparison was not possible because the firm, formerly a country-club operator, completed a reverse takeover of New Media Corp in November 1999.
In the nine months to December 31, the company recorded a net loss of HK$5.43 million. But this was affected by a change in accounting policy, resulting in a decrease in net loss of HK$29.57 million last year and a decrease of HK$4.91 million in the nine months to December 31, 1999.
Without the change, the company would have reported a net loss of HK$234.13 million last year and a net loss of HK$10.34 million in the nine-month period in 1999.
The company has decided to write off the goodwill it paid in acquiring New Media instead of amortising it over 20 years. This was despite the Hong Kong Society of Accountants encouraging companies to act early to adopt a new rule, effective on January 1 this year, that requires firms to amortise and expense goodwill in the income statement instead of writing it off.
E-New Media, which provides secure payment solutions to telecommunications and Internet operators, was hit by a provision of HK$105 million for loss of value of its investment securities.
Including provision for its investment in three Internet firms, it incurred a loss of HK$138 million in its e-commerce-related business and booked a HK$54 million property write-down.