The calculation of earnings per share is based on the profit attributable to Shareholders of HK$550,798,000 (1996: HK$527,743,000) and 403,639,413 shares in issue during the two years.

(a) The Group

(b) All the Group's leasehold land is held in Hong Kong and on medium term leases.

(c) Valuation

Included in the cost or valuation of fixed assets of the Group is the following assets shown at valuation:

In preparing these accounts, advantage has been taken of the transitional provisions set out in paragraph 72 of SSAP 17 "Property, Plant and Equipment" issued by the Hong Kong Society of Accountants, with the effect that leasehold land has not been revalued to fair value at the balance sheet date.

Details of subsidiaries are as follows:

Details of the associated companies are as follows:

Note:

During the year ended 31 December 1997, a co-operative joint venture, Dalian HK Macau Motor Bus Services Limited ("Dalian HK Macau"), was formed between HK Macau Ltd ("HK Macau"), a 60% owned subsidiary of the Group, and , a PRC entity. The principal activity of Dalian HK Macau is the provision of bus services in Dalian, PRC.

Pursuant to the joint venture agreement, HK Macau contributed the whole of the registered capital of Rmb22 million. The joint venture is for a period of 15 years commencing 31 July 1997. The capital contribution is repayable by Dalian HK Macau in equal annual instalments over 5 years. The profits and losses of Dalian HK Macau are shared equally by HK Macau and .

According to the joint venture agreement, HK Macau has the right to appoint five out of a total of nine directors of Dalian HK Macau with each director carrying one vote. Although this represents a majority of the board of directors, a board resolution can only be passed with a minimum of 6 votes in accordance with the articles of association of the joint venture. Accordingly, HK Macau has no effective control over the board of directors and Dalian HK Macau has been excluded from consolidation and dealt with in the consolidated accounts under the equity method of accounting and classified as an associated company.