Refund boosts Dickson's results
A HK$44 million write-back from a controversial transaction connected with its chairman helped upmarket retailer Dickson Concepts (International) post a sevenfold increase in interim net profit.
Profit for the six months to September 30 reached HK$55.14 million, up from HK$6.75 million last year.
In December 1999, the company's Internet shopping arm, Dickson Cyber.com, entered into a controversial HK$130 million consultancy contract with a firm owned by chairman Dickson Poon.
The fixed fee was to be paid to Mr Poon's company to design six portals and provide technical support for a cyber-mall. The agreement also required the subsidiary to pay third-party suppliers HK$110 million for hardware and software.
A total expense of HK$240 million was incurred for the year to March 2000.
Dickson Concepts yesterday said the deal expired on September 30. The total amount invoiced for Mr Poon's company stood at HK$90.6 million while the suppliers' fee was HK$105.4 million.
'The related company has confirmed that it will not seek payment of the remaining amount of the fixed fee included in the originally agreed estimate as this has not been incurred in the view of the reduction in the actual direct costs due to the change in market conditions,' it said.
Dickson Concepts thus credited back HK$44 million to its account for its interim result.
It said turnover for the six months increased 11.2 per cent to HK$1.15 billion.