Company blames special dividend review for the late announcement Regulators may take action against Hon Po Group (Lobster King) for a six-month delay in releasing its results for last year. After missing the April 30 deadline, the restaurant chain yesterday finally reported it suffered a net loss of $77.04 million last year. Since then, Hon Po, which operates 12 outlets, has issued 30 company announcements to Hong Kong Exchanges and Clearing (HKEx) explaining the postponement. 'Although the result announcement came out, it does not mean that it is the end,' said a spokeswoman for HKEx. 'The HKEx will reserve the right to take action as a delayed result announcement is considered a breach of the listing rules.' Under listing requirements, companies on the main board should issue their annual results no later than four months after the financial year-end, and three months after the end of an interim period. Hon Po said the delay in reporting its audited annual results was because more time was needed for independent accountants to review a special dividend paid before the listing of Hon Po Investment, which is majority-owned and controlled by chairman Cheung To-sang. 'After taking into account the professional advice, the board approved to reduce the special dividend from $224.6 million to $92.55 million, cancelling and waiving the excessive amount,' Mr Cheung said in the results announcement. As the special dividend had been used to set off the account balance with Hon Po Investment and involved no cash payment, there was no adverse impact on the group's financial position and net tangible asset value, he said. In June, Hon Po revealed there were 'apparent inaccuracies'' in some financial statements in its listing prospectus issued in January last year. The inaccurate information involved the overstatement of the special dividend payment. Hon Po admitted last month that the special dividend was 'erroneous and unlawful'' under Cayman Islands law, and the controlling shareholder agreed to cut the amount to $92.55 million. Yesterday, the company attributed last year's dismal earnings to a combined $35.9 million provision for impairment of leasehold land and buildings and other fixed assets. It previously said the interim result for the six months to June this year could be issued within two weeks after the announcement of last year's result. Shares of Hon Po yesterday dropped 1.16 per cent to close at 8.5 cents.