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Golden Resorts Loss Up

20 September 2005

MACAU – As reported by the Hong Kong Standard: "Golden Resorts Group, a Hong Kong watchmaker turned Macau hotel-casino operator, said its first-half loss widened sharply to HK$365.9 million from HK$3.2 million a year earlier thanks largely to new accounting rules.

"When the company acquired the Grandview Hotel for HK$500 million in November last year, Golden Resorts chairman Jenkin Cheung personally gave shares valued at HK$496.8 million as of March 30 to chief executive Pollyanna Chu and non-executive director Lee Wai-man, Chu's father, as a reward for joining Golden Resorts. Lee, who has interests in VIP rooms in Macau, has long been associated with gambling tycoon Stanley Ho. However, Chu, who founded Hong Kong's Kingston Securities, received three-quarters of the share bonus.

"Under new accounting rules adopted this year, the share gift was treated as a business expense, even though the stock came from Cheung's personal holdings, not the company treasury.

"…However, the Macau operations still reported a net loss of HK$ 6.3 million as a result of a one-time HK$20 million payment to tenants of the Grandview Hotel as compensation for the early termination of their leases to make room for a casino expansion…"

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