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[Hatch]

Hi,

weiß jemand irgend etwas über die HV vom 01.06. von China Online bzw. woher man Infos bekommt ?
Habe bereist überall gesucht - no Chance.

Thz, Tony

[dirko]

es folgt der 52!!! seitige Geschäftsbericht im dem alles steht was auf der HV besprochen wurde


China Online (Bermuda)Limited
2
Board of Directors
Law Wing Kit, Stephen (Chairman)
Chang Wang (Executive Director)
Chen Chi Lin, Peter (Executive Director)
Cheng Mo Chi, Moses (Independent Non-executive Director)
Tan Shao Hua (Independent Non-executive Director)
Secretary
Fung Ching Man, Ada
Auditors
Deloitte Touche Tohmatsu
Certified Public Accountants
Registered Office
Cedar House, 41 Cedar Avenue
Hamilton HM12, Bermuda
Head Office and Principal Place of Business in Hong Kong
47/F, China Online Centre
333 Lockhart Road
Wan Chai
Hong Kong
Principal Bankers
American Express Bank Ltd.
Banque Cantonale Vaudoise
Commerzbank (South East Asia) Limited
Deutsche Bank AG, Hong Kong
Sin Hua Bank Ltd.
Société Générale
The Hongkong Chinese Bank, Ltd.
Solicitors
P.C. Woo & Co.
Fred Kan & Co.
Richards Butler
Preston Gates & Ellis
Hong Kong Branch Share Registrars
Tengis Limited
4/F Hutchison House
10 Harcourt Road
Central
Hong Kong
Corporate Information

Annual Report 2000
3
Notice of Annual General Meeting
NOTICE IS HEREBY GIVEN that the Annual General Meeting of the Company will be held at Board Room, 7th
Floor, The Dynasty Club Limited, South West Tower, Convention Plaza, 1 Harbour Road, Wanchai, Hong Kong on
Friday, 1 June 2001 at 10:00 a.m. for the following purposes:-1.
To receive and consider the Audited Financial Statements and the Reports of the Directors and Auditors for
the year ended 31 December 2000.
2. To declare final dividends.
3. To re-elect Directors and authorise the Directors to fix their remuneration.
4. To re-appoint Auditors and authorise the Directors to fix their remuneration.
5. To transact any other business.
By Order of the Board
Fung Ching Man, Ada
Company Secretary
Hong Kong, 24 April 2001
Notes:
(i) Any member of the Company entitled to attend and vote at a meeting of the Company or a meeting of the holder of any class of shares in
the Company shall be entitled to appoint another person as his proxy to attend and vote instead of him. A proxy need not be a member of
the Company. A member may appoint more than one proxy to attend on the same occasion.
(ii) The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing, or if the
appointor is a corporation, either under seal, or under the hand of an officer or attorney duly authorised.
(iii) The Register of Members will be closed from Tuesday, 29 May 2001 to Friday, 1 June 2001, both days inclusive, during which period no
transfer of shares will be effected. In order to qualify for the proposed final dividends, all share certificates with completed transfer forms
either overleaf or separately, must be lodged with the branch share registrars of the Company in Hong Kong, Tengis Limited at 4th Floor,
Hutchison House, 10 Harcourt Road, Central, Hong Kong for registration not later than 4:00 p.m. on Monday, 28 May 2001.
(iv) Registered and unregistered holders of Warrants who wish to exercise their subscription rights to receive shares which will qualify for the
proposed final dividends must lodge the relevant Warrant Certificates and/or the relevant Instruments of Transfer and subscription forms duly
completed and accompanied by the requisite subscription monies with the branch share registrars of the Company in Hong Kong, Tengis
Limited at 4th Floor, Hutchison House, 10 Harcourt Road, Central, Hong Kong for registration not later than 4:00 p.m. on Monday,
28 May 2001.
(v) The instrument appointing a proxy and the power of attorney or other authority, if any, under which it is signed or a notarially certified copy
of that power or authority shall be deposited at the branch share registrars of the Company in Hong Kong, Tengis Limited at 4th Floor,
Hutchison House, 10 Harcourt Road, Central, Hong Kong not less than forty-eight hours before the time for holding the meeting or adjourned
meeting


China Online (Bermuda)Limited
4
Chairman ’s Statement
Dear Shareholders,
On behalf of the Board of Directors of the Company, I have pleasure to report on the operation and other aspects of the
Group for the year ended 31 December 2000.
Finanical Results
Turnover of the Group for the year ended 31 December 2000 was HK$2,442,429,000 representing approximately a 300%
increase as compared to that of the year 1999. Net profit from ordinary activities attributable to shareholders rose approximately
412% to HK$1,332,818,000 which included the gain on realisation of long term investments of HK$2,870,891,000. Basic
earnings per share for the year ended 31 December 2000 was 14.35 HK cents, a rise of approximately 402% as compared
to that of the year 1999.
Dividends
The Directors recommend the payment of a final dividend of 0.5 HK cents per share (1999: Nil) to shareholders whose
names appear on the Register of Members of the Company on 1 June 2001. Dividend warrants will be sent to shareholders
on 28 June 2001.
Closure of Registers of Members and of Warrrantholders
The Registers of Members and of Warrantholders will be closed from Tuesday, 29 May 2001 to Friday, 1 June 2001, both
days inclusive, during which no share and warrant transfer will be effected.
Review of Operations
Performance of the Group’s mobile handset
distribution business was satisfactory during
the year under review, with turnover
increased by approximately 7% to
HK$236,346,000 as compared to that of the
year 1999. Despite keen competition of the
mobile handset distribution business in the
Hong Kong market, Star Telecom Limited
(“Star Telecom”), the Company’s wholly-owned
subsidiary, managed to secure more
distribution rights of popular and trendy
brands during the second half of the year
2000 and is now one of the leading
distributors owning a number of handset
brand distributorships, some of which even
on an exclusive basis and covering the vast
China market.
As one of the leading distributors of mobile phones and telecom-related products,
Star Telecom is dedicated to bringing more choices to customers.




Annual Report 2000
5
The year 2000 was a year of consolidation for the Group’s intelligent building system integration operation in the People’s
Republic of China (the “PRC”) with revenue amounted to HK$10,063,000. The Group’s strategic investment in the distribution
network of mobile handsets and accessories in the major cities of the PRC achieved a steady growth in revenue.
Pursuant to approval given by the shareholders in the special general meeting of the Company on 11 March 2000 to realise
the Group’s long term investment in the shares of Pacific Century CyberWorks Limited (“PCC Shares”), the Group has
realised a total of 190,500,000 PCC Shares during the year under review.
The turnover of trading and investment in financial instruments of the Group during the fiscal year 2000 amounted to
HK$2,196,020,000. The stock market turmoil experienced in the US market and the Hong Kong market which started from
the third quarter of the year 2000 and straddled into the year 2001, has affected the Group’s investment performance in
these areas and offset part of the gain realised from long term investments.
The Group’s 21.7% associated company, Millennium Group Limited (“MGL”) reported a loss attributable to shareholders of
HK$8,649,000 for the six months ended 30 September 2000 as its information technology projects are still in their start-up
stage. During the six months ended 30 September 2000, MGL’s 35% associated company, Jilian (Jilin) Petrochemicals
Limited recorded an operating profit before tax of HK$15.9 million of which MGL’s share was HK$5.6 million as compared
to a loss of HK$0.7 million for the corresponding period.
Up to the year end date, the Group has acquired on market for long term purpose an aggregate of 224,385,000 shares of
Sun Hung Kai & Co. Limited (“SHK & Co”) and 71,848,000 shares of Takson Holdings Limited (“THL”), representing
approximately 19.3% and 19.2% in the issued share capital of SHK & Co and THL respectively. In light of the recent and
forthcoming business and stock market environments, the Group has carried out an annual review of its long term investment
portfolio and made provisions for decline in value of certain of its long term investments which the board of the Directors
considered other than temporary.
Liquidity and Financing
The open offer of 1,856,688,098 units of the Company’s warrants at an issue price of HK$0.05 per warrant on the basis of
one warrant for every five existing shares of the Company held on 15 May 2000 was completed on 2 June 2000 from which
proceeds of approximately HK$93 million before expense was raised. Each warrant will carry the right to subscribe for a new
share of the Company at an initial subscription price of HK$0.30 per share, subject to adjustment, exercisable during the
period from 7 June 2000 to 6 June 2003 (both days inclusive).
The Group’s non-current assets comprised mainly of investment properties of HK$15 million, property, plant and equipment
of HK$41 million, interests in associates of HK$65 million, long term investments of HK$340 million. These non-current
assets were principally financed by shareholders’ funds. As at the year end date, the Group has a net current assets of
HK$1,570 million.
All of the Group’s borrowings are arranged on short term basis, repayable within 1 year and secured by marketable securities.
As at the year end date, the Group’s borrowings amounted to HK$265,519,000 representing an increase of
HK$264,822,000 over last year.
The Group continued to maintain a low gearing ratio, calculated on the basis of the Group’s net borrowings (after deducting
cash and bank balances) over shareholders’ funds, at approximately 11% (1999: nil) at the year end date.
The Group has little foreign exchange exposure and the Group’s borrowings were all denominated in Hong Kong Dollars.
• Chairman ’s Statement

China Online (Bermuda)Limited
6
Pledge of Assets
At the balance sheet date, certain assets of the Group with aggregate carrying value of HK$1,425,212,000 (1999:
HK$24,796,000) were pledged to secure general loan facilities.
Prospects
Although the mobile handset distribution business is operating in a highly competitive market, the Group is cautiously
optimistic to conclude further distribution rights with other top brands in the year to come. To capture the full opportunities
arising from the dynamic and converging telecom market, Star Telecom seeks to expand its business from distributing
mobile handsets to a wider range of telecommunication products including PDA, smartphone, DECT (Digital Enhanced
Cordless Telecommunication) phone, wireless & digital peripherals and telecom accessories.
Being one of the few foreign-owned licensees authorized to provide integration services for intelligent buildings in the PRC,
Shanghai Tricom Telecom Equipment Co., Ltd. (“Shanghai Tricom”), the subsidiary of the Company, has contracted several
new projects of intelligent building system integration in certain major cities in the PRC in the first few months of year 2001.
It is expected that increasing computerization in private and public sectors of the PRC will foster strong internet and e-infrastructure
growth which offers more business opportunities for Shanghai Tricom to capture.
The ups and downs of economic conditions and investment climate in Hong Kong and overseas, especially in the US,
definitely created certain uncertainties as to the financial performance of the Group for the new financial year. The Group
holds cautious view in the coming year and has started to rationalize its investment portfolio and will continue to retain a
substantial pool of liquid assets with low gearing to meet any future challenges and opportunities.
Employees
The Group, including its subsidiaries but excluding its associates, employed approximately 83 (1999: 110) employees at the
year end date. Employees’ cost (excluding directors’ emoluments) amounted to approximately HK$13,232,000 (1999:
HK$35,087,000) for the year. The Group ensures that the pay levels of its employees are competitive and employees are
rewarded on a performance related basis within the general framework of the Group’s salary and bonus system.
Appreciation
A great deal of works have to be done in the current fiscal year and on behalf of all shareholders and I extend our grateful
thanks, in advance, to both our management and staff for their loyalty, hard work and dedication.
Law Wing Kit, Stephen
Chairman
Hong Kong, 24 April 2001
• Chairman ’s Statement


Annual Report 2000
7
Executive Directors
Mr.Law Wing Kit,Stephen,aged 48, was appointed as an
executive director of the Company on 28 December 1999
and was appointed as the Chairman of the Company on
9 February 2001. He has over 20 years of international
managerial experience in the areas of investment services,
corporate finance and securities. Prior to joining the
Company, Mr. Law was executive directors of other listed
companies in Hong Kong and held the positions of
managing director - Capital Markets Group of UBS East Asia
Limited based in Singapore; managing director of Fidelity
Investments (Singapore) Ltd.; director of Asia Pacific
International Office, of Merrill Lynch Pierce, Fenner & Smith
(S) Pte. Ltd. and executive director of Equity Transaction
Group of Merrill Lynch Capital Markets Group respectively.
Mr. Law was a director of the Singapore International
Monetary Exchange Limited from 1985 to 1990. He is also
the Chairman of China Sci-Tech Holdings Limited (“CST”).
Mr.Chang Wang,aged 28, was appointed as an executive
director of the Company on 28 December 1999. He was
graduated from the Bond University of Australia with a
bachelor’s degree in Commerce. Mr. Chang has several years
of experience in property development and investment. He
is also an executive director of CST.
Mr.Chen Chi Lin,Peter,aged 49, was appointed as an
executive director of the Company on 3 November 2000.
He has over 30 years of experience in trading, property
development and investment in Asia Pacific region, especially
in the PRC.
Biographical Details in Respect of
Directors and Senior Management
Independent Non-executive Directors
Mr.Cheng Mo Chi,Moses,aged 51, was appointed as an
independent non-executive director of the Company on 28
December 1999. He is a senior partner of Messrs. P.C. Woo
& Co., a firm of solicitors and notaries in Hong Kong.
Mr. Cheng was a member of the Legislative Council of Hong
Kong between 1991 and 1995. He is currently the Chairman
of the Hong Kong Institute of Directors, the Board of
Education and the Committee on the Promotion of Civic
Education. He also serves on the boards of various other
listed companies as independent non-executive directors.
Mr.Tan Shao Hua,aged 40, was appointed as an
independent non-executive director of the Company on 28
December 1999. He has technical background in
information technology. After receiving his Ph.D. in Electrical
Engineering from Katholicke Universiteil Leuven, Belgium
in 1987, he took on various research and professional
positions in Europe, USA, Japan, Singapore, etc. He is
renowned internationally for his work in selected IT related
technical areas, such as intelligent IT systems, multimedia
technology and has received many awards and recognition
for his contributions to these areas. He is a senior member
of the Institute of Electrical and Electronic Engineers in the
United States of America. He also has extensive experience
in setting up and managing high-tech businesses in the PRC.
He is also an independent non-executive director of CST.

China Online (Bermuda)Limited
8
• Biographical Details in Respect of Directors and Senior Management
Senior Management
Ms.Chen Sai Fang,aged 49, was appointed as the general
manager of China division. Ms. Chen received education in
China and was graduated with specialization in Finance. With
extensive knowledge and experience gained from working
with Provincial Bank in PRC for over 20 years and being in
charge of the credit department for over 10 years, Ms. Chen
has developed expertise in business management, investment
project appraisals as well as various operations of securities
and finance industry and thus earned high reputation among
the industry, both inside and outside China. In 1986, she
was awarded the title of Economist. Prior to joining the
Company, Ms. Chen has been the Division General Manager
of a China-owned Hong Kong company for 7 years.
Ms.Leung Yuk Ming,Jady,aged 40, was appointed as the
chief operating officer of Star Telecom Limited, a wholly-owned
subsidiary of the Company in June 2000. Graduated
from the Chinese University of Hong Kong with an
honorable bachelor degree of Business Administration, she
has over 17 years of working experience in marketing, sales,
customer services and business management profession.
Since 1992, Ms. Leung has been assuming senior positions
in different reputable telecommunications companies
including New World Paging, Cable TV and Peoples Phone.
Being actively involved in the launching and operations of
various telecommunications services ranging from paging,
fixed network services, cable TV, to mobility services such
as GSM/PCS, she is renowned for her extensive experience
in setting up and managing successful telecommunications
business in the industry.
Mr.Chen Da Yi,aged 62, is the general manager of the
Company’s subsidiary, Shanghai Tricom Telecom Equipment
Co., Ltd. and is responsible for all corporate management,
project for building automation, data network infrastructure
development, project design in telecommunications and
related fields. He holds a degree in computer science from
Beijing Qing Hua University, China. He has extensive
experience in telecommunications field over 36 years.
Mr.Yao Wei,David,aged 33, joined the Group as the general
manager of the Group’s strategic investment in a distribution
network in the PRC (the “Investment”) in mid 1998. David
received his BBA from Kingston College of University of
British Colombia in Canada. David had worked in China,
Japan and Canada for more than 10 years before joining
the Group in Shanghai. Most recently, he worked as the
general manager of a multinational corporation in Shanghai
to distribute telecommunications products. David has
extensive experience and knowledge in international trading,
telecommunications products, market entry strategy, and
running China based operations. Since joining the Group,
David has been responsible for all aspects of the day-to-day
operation of the Investment.
Mr.Kong Muk Yin,aged 35, is the financial controller of
the Company. He was graduated from City University of
Hong Kong with a bachelor’s degree in business studies.
He is a fellow member of The Chartered Association of
Certified Accountants and an associate member of Hong
Kong Society of Accountants. He is also the financial
controller and company secretary of CST.
Mr.Chow Wing Lok,Percy,aged 37, is the regional financial
controller of the Group responsible for all financial,
accounting and administration aspects of the Company’s
PRC subsidaries. He holds a degree in Business
Administration from Ottawa University, USA and is a
member of the Australian Association of Taxation and
Management Accountants and is a member of British
Institute of Cost & Executive Accountants. He has extensive
experience in working in PRC for more than 12 years.
Ms.Fung Ching Man,Ada,aged 34, is the company
secretary of the Company. She is an associate member of
The Institute of Chartered Secretaries and Administrators
and has over 10 years of working experience in the company
secretarial profession.
Annual Report 2000
9
The directors present their annual report and the audited
financial statements for the year ended 31 December 2000.
Principal Activities
The Company is an investment holding company. The
activities of its principal subsidiaries and an associate are
set out in notes 42 and 43 to the financial statements,
respectively.
Results and Appropriations
The results and appropriations of the Group for the year
ended 31 December 2000 are set out in the consolidated
income statement on page 13.
The directors recommend the payment of a final dividend
of 0.5 HK cents per share to the shareholders of the
Company whose names appear on the Register of Members
on 1 June 2001 and the retention of the remaining profit
for the year.
Financial Summary
A financial summary of the Group for the past five financial
years is set out on page 52.
Share Capital,Warrants and Share Options
Details of movements in the share capital, warrants and
share options of the Company during the year are set out
in notes 24, 25 and 26 to the financial statements,
respectively.
Reserves
Movements in the reserves of the Group and the Company
during the year are set out in note 27 to the financial
statements.
Investment Properties and Property,Plant and
Equipment
The Group’s investment properties, and land and buildings
were revalued at 31 December 2000 and the resulting
Directors ’ Report
deficits arising on these revaluations of approximately
HK$1,350,000 and HK$2,395,000 respectively have been
charged to the consolidated income statement.
Details of these and other movements in the investment
properties, property, plant and equipment of the Group
during the year are set out in notes 14 and 15 to the financial
statements, respectively.
Directors and Service Contracts
The directors of the Company during the year and up to
the date of this report were:
Executive directors:
Mr. Law Wing Kit, Stephen
Mr. Chang Wang
Mr. Chen Chi Lin, Peter (appointed on 3 November 2000)
Independent non-executive directors:
Mr. Cheng Mo Chi, Moses
Mr. Tan Shao Hua
In accordance with clauses 99 and 182 of the Company’s
bye-laws, Messrs. Chen Chi Lin, Peter and Tan Shao Hua
will retire and, being eligible, offer themselves for re-election
at the forthcoming annual general meeting.
None of the directors has a service contract with the
Company or any of its subsidiaries which is not determinable
by the Group within one year without payment of
compensation, other than statutory compensation.
Directors ’ Interests in Contracts
Other than as disclosed in the “Transactions with the
substantial shareholder” section of this report and note 41
to the financial statements, no contracts of significance to
which the Company or any of its subsidiaries was a party
and in which a director of the Company had a material
interest, whether directly or indirectly, subsisted at the end
of the year or at any time during the year.

China Online (Bermuda)Limited
10
Directors ’and Chief Executives ’Interests in
Shares,Warrants and Share Options
As at 31 December 2000, none of the directors and chief
executives of the Company or any of their associates had
any interests in any securities of the Company or any of its
subsidiaries or associated corporations as defined in the
Hong Kong Securities (Disclosure of Interests) Ordinance
(the “SDI Ordinance”), as recorded in the register maintained
by the Company pursuant to Section 29 of the SDI Ordinance
or as otherwise notified to the Company and The Stock
Exchange of Hong Kong Limited (the “Stock Exchange”)
pursuant to the Model Code for Securities Transactions by
Directors of Listed Companies.
Directors ’Rights to Acquire Shares or Debentures
At no time during the year was the Company or any of its
subsidiaries a party to any arrangements to enable the
directors of the Company to acquire benefits by means of
the acquisition of shares in, or debentures of, the Company
or any other body corporate. In addition, none of the
directors or their spouses or children under the age of 18
had any right to subscribe for the securities of the Company.
Substantial Shareholders
The register of substantial shareholders maintained by the
Company pursuant to Section 16(1) of the SDI Ordinance
recorded the following parties as having an interest
representing 10% or more in the issued share capital of
the Company as at 31 December 2000:
Number of
Name shares held Percentage held
China Sci-Tech
Holdings
Limited (“CST”) 3,172,830,000 34.17%
Vigor Online
Offshore Limited
(“Vigor”) 3,000,000,000 32.31%
Note: Harbour Fair Overseas Limited (“Harbour Fair”) held
172,830,000 shares in the Company. Both Harbour
Fair and Vigor are wholly-owned subsidiaries of CST.
Accordingly, CST is deemed by the SDI Ordinance to
be interested in aforementioned shares.
Save as disclosed above, no person has registered an interest
in the share capital of the Company that was required to
be recorded pursuant to Section 16(1) of the SDI Ordinance.
Major Customers and Suppliers
Aggregate sales attributable to the Group’s five largest trade
customers were less than 30% of total sales and the
aggregate purchases attributable to the Group’s five largest
trade suppliers were less than 30% of total purchases.
Transactions with the Substantial Shareholder
During the year, the Group had the following transactions
with CST:
(a) On 2 June 2000, the Company issued a total of
637,148,000 warrants of the Company to Harbour Fair
and Vigor, both of which are wholly-owned subsidiaries
of CST at a price of HK$0.05 per warrant on the basis
of one warrant for every five existing shares held.
Additionally, Cyber Range Limited, another wholly-owned
subsidiary of CST, subscribed 890,292,547
warrants of the Company on the same date pursuant
to an underwriting agreement dated 24 March 2000,
which was subsequently amended by a supplemental
agreement dated 18 April 2000. The total underwriting
commission paid to CST was HK$1,526,000 based on
2.5% of the total issue price of the warrants
underwritten by CST.
(b) In 2000, the Company paid a reimbursement of
expenses of HK$6,000,000 to CST. The reimbursement
includes (i) salaries of two directors of the Company,
both of them also being the directors of CST; (ii) other
staff costs; and (iii) daily operating expenses.
• Directors ’ Report


Annual Report 2000
11
Convertible Securities,Options,Warrants or
Similar Rights
Other than the outstanding warrants and share options as
set out in notes 25 and 26 respectively to the financial
statements, the Company had no outstanding convertible
securities, options, warrants or other similar rights as at
31 December 2000.
Purchase,Sale or Redemption of Listed
Securities
Neither the Company, nor any of its subsidiaries purchased,
sold or redeemed any of the Company’s listed securities
during the year.
Pre-emptive Rights
There are no provisions for pre-emptive rights under the
Company’s bye-laws or the laws of Bermuda, which would
oblige the Company to offer new shares on a pro-rata basis
to existing shareholders.
Corporate Governance
The Company has complied throughout the year ended
31 December 2000 with the Code of Best Practice as set
out in Appendix 14 of the Rules Governing the Listing of
Securities on the Stock Exchange.
• Directors ’ Report
Auditors
During the year, Messrs. Ernst & Young resigned as auditors
of the Company and Messrs. Deloitte Touche Tohmatsu
were then appointed. Except for the fiscal period from
1 January 1999 to 31 December 1999, in which Messrs.
Ernst & Young acted as auditors of the Company, Messrs.
Deloitte Touche Tohmatsu have acted as auditors of the
Company for the preceding two years.
A resolution will be submitted to the forthcoming annual
general meeting of the Company to re-appoint Messrs.
Deloitte Touche Tohmatsu as auditors of the Company.
On behalf of the Board
Law Wing Kit, Stephen
Chairman
Hong Kong, 24 April 2001


China Online (Bermuda)Limited
12
To the Shareholders of
China Online (Bermuda)Limited
(incorporated in Bermuda with limited liability)
We have audited the financial statements on pages 13 to
51 which have been prepared in accordance with accounting
principles generally accepted in Hong Kong.
Respective Responsibilities of Directors and
Auditors
The Company’s directors are responsible for the preparation
of financial statements which give a true and fair view. In
preparing financial statements which give a true and fair
view it is fundamental that appropriate accounting policies
are selected and applied consistently.
It is our responsibility to form an independent opinion, based
on our audit, on those statements and to report our opinion
to you.
Basis of Opinion
We conducted our audit in accordance with Statements of
Auditing Standards issued by the Hong Kong Society of
Accountants. An audit includes examination, on a test basis,
of evidence relevant to the amounts and disclosures in the
financial statements. It also includes an assessment of the
significant estimates and judgments made by the directors
in the preparation of the financial statements, and of
whether the accounting policies are appropriate to the
circumstances of the Company and the Group, consistently
applied and adequately disclosed.
We planned and performed our audit so as to obtain all the
information and explanations which we considered
necessary in order to provide us with sufficient evidence to
give reasonable assurance as to whether the financial
statements are free from material misstatement. In forming
our opinion we also evaluated the overall adequacy of the
presentation of information in the financial statements. We
believe that our audit provides a reasonable basis for our
opinion.
Opinion
In our opinion the financial statements give a true and fair
view of the state of affairs of the Company and the Group
as at 31 December 2000 and of the profit and cash flows
of the Group for the year then ended and have been properly
prepared in accordance with the disclosure requirements
of the Hong Kong Companies Ordinance.
Deloitte Touche Tohmatsu
Certified Public Accountants
Hong Kong, 24 April 2001
Auditors ’ Report

Annual Report 2000
13
Auditors ’ Report
Consolidated Income Statement
for the Year Ended 31 December 2000
NOTES 2000 1999
HK$’000 HK$’000
Turnover 3 2,442,429 610,823
Cost of sales (2,637,714) (525,796)
Gross (loss) profit (195,285) 85,027
Net gains on investments 4 1,622,602 355,596
Gain on disposal of discontinued operations, net 5 — 95,680
Gain on disposal of an associate 7,800 —
Other revenue 6 55,363 87,274
Distribution costs (10,243) (78,126)
Administrative expenses (46,148) (72,189)
Other operating expenses (76,516) (73,734)
Provision in respect of distribution network
development costs in Mainland China (9,189) (95,133)
Profit from operations 7 1,348,384 304,395
Finance costs 8 (13,723) (5,279)
Share of results of unconsolidated subsidiaries — (11,845)
Share of results of associates (884) (29,927)
Profit before taxation 1,333,777 257,344
Tax credit (charge) 10 2,161 (2,579)
Profit before minority interests 1,335,938 254,765
Minority interests (3,120) 5,616
Profit for the year 11 1,332,818 260,381
Dividends 12 46,432 181,854
Earnings per share 13
- Basic 14.35 HK cents 2.86 HK cents
- Diluted 14.35 HK cents N/A




China Online (Bermuda)Limited
14
Consolidated Balance Sheet
at 31 December 2000
NOTES 2000 1999
HK$’000 HK$’000
Non-current assets
Investment properties 14 15,400 16,750
Property, plant and equipment 15 41,448 40,765
Interests in associates 17 65,244 —
Investments in securities 18 339,638 3,620,000
Other non-current assets 1,922 1,022
463,652 3,678,537
Current assets
Inventories 19 8,966 9,685
Investments in securities 18 1,984,138 —
Debtors, deposits and prepayments 20 28,736 51,903
Taxation recoverable — 1,443
Pledged bank deposits — 10,296
Bank balances and cash 37,010 632,232
2,058,850 705,559
Current liabilities
Creditors and accrued charges 21 166,022 158,490
Customers’ deposits and receipts in advance 7,118 1,984
Taxation payable 3,947 3,947
Dividend payable 46,432 —
Bank borrowings - due within one year 22 265,519 697
489,038 165,118
Net current assets 1,569,812 540,441
Total assets less current liabilities 2,033,464 4,218,978
Minority interests 3,695 575
2,029,769 4,218,403
Capital and reserves
Share capital 24 92,865 92,792
Reserves 27 1,936,904 4,125,611
2,029,769 4,218,403
Law Wing Kit, Stephen Chang Wang
Director Director


Annual Report 2000
15
NOTES 2000 1999
HK$’000 HK$’000
Non-current assets
Interests in subsidiaries 16 3,397,590 1,120,515
Current assets
Deposits and prepayments 2,147 17,830
Bank balances and cash 13,629 593,046
15,776 610,876
Current liabilities
Accrued charges 830 1,600
Dividend payable 46,432 —
47,262 1,600
Net current (liabilities) assets (31,486) 609,276
Total assets less current liabilities 3,366,104 1,729,791
Non-current liabilities
Amounts due to subsidiaries 23 1,977,892 440,079
1,388,212 1,289,712
Capital and reserves
Share capital 24 92,865 92,792
Reserves 27 1,295,347 1,196,920
1,388,212 1,289,712
Law Wing Kit, Stephen Chang Wang
Director Director
Balance Sheet
at 31 December 2000

China Online (Bermuda)Limited
16
Consolidated Statement of Recognised
Gains and Losses
for the Year Ended 31 December 2000
2000 1999
HK$’000 HK$’000
Exchange differences arising on translation of overseas subsidiaries — 1,672
Share of exchange reserve of an associate 70 —
Revaluation (deficit) surplus of non-trading investments (229,223) 3,471,277
Net (losses) gains not recognised in the consolidated income statement (229,153) 3,472,949
Profit for the year 1,332,818 260,381
Total recognised gains 1,103,665 3,733,330
Elimination against reserves of goodwill arising on acquisition of
- subsidiary (569) —
- associate (30,035) —
Share of capital reserve of an associate (668) —
1,072,393 3,733,330

Annual Report 2000
17
NOTES 2000 1999
HK$’000 HK$’000
Net cash outflow from operating activities 29 (3,365,566) (124,438)
Returns on investments and servicing of finance
Dividends paid — (181,854)
Interest paid (6,494) (5,273)
Interest on finance lease obligations — (6)
Interest received 25,926 24,180
Dividends from associates — 200
Dividends from investments in securities 26,739 —
Net cash inflow (outflow) from returns on investments
and servicing of finance 46,171 (162,753)
Taxation
Hong Kong Profits Tax refunded 3,571 7,916
Investing activities
Loan advanced to associates — (1,609)
Purchase of interests in associates (96,728) —
Purchase of investments in securities (542,341) (303,040)
Purchase of a subsidiary (net of cash and cash equivalents acquired) 30 (2,999) —
Purchase of property, plant and equipment (7,423) (18,253)
Purchase of other non-current assets (900) —
Mainland China distribution network development costs incurred (9,189) (95,133)
Decrease (increase) in pledged bank deposits 10,296 (10,060)
Proceeds from realisation of non-trading investments 3,012,549 623,188
Proceeds from disposal of an associate 7,800 —
Disposal of subsidiaries and businesses (net of cash
and cash equivalents disposed of) 31 — 490,070
Proceeds from disposal of property, plant and equipment 148 783
Proceeds from disposal of an unconsolidated subsidiary — 500
Net cash inflow from investing activities 2,371,213 686,446
Net cash (outflow) inflow before financing (944,611) 407,171
Consolidated Cash Flow Statement
for the Year Ended 31 December 2000

China Online (Bermuda)Limited
18
Consolidated Cash Flow Statement
for the Year Ended 31 December 2000
NOTES 2000 1999
HK$’000 HK$’000
Net cash (outflow) inflow before financing (944,611) 407,171
Financing 32
Proceeds from issue of new shares 1,414 31,793
Net proceeds from issue of warrants 90,382 —
New bank and other loans raised during the year 1,397,866 9,347
Repurchase of own shares — (649)
Repayment of bank and other loans (1,140,255) (56,406)
Repayment of obligations under finance leases — (1,037)
Repayment of advances from ultimate holding company — (2,468)
Net cash inflow (outflow) from financing 349,407 (19,420)
(Decrease) increase in cash and cash equivalents (595,204) 387,751
Cash and cash equivalents at beginning of the year 632,214 244,463
Cash and cash equivalents at end of the year 33 37,010 632,214


Annual Report 2000
19
Notes to the Financial Statements
for the Year Ended 31 December 2000
1.General
The Company is incorporated in Bermuda as an exempted company with limited liability and its shares are listed on
The Stock Exchange of Hong Kong Limited (the “Stock Exchange”).
The Company is an investment holding company. The activities of its principal subsidiaries and an associate are set out
in notes 42 and 43 respectively.
2.Significant Accounting Policies
The financial statements have been prepared under the historical cost convention as modified for the revaluation of
investment properties, land and buildings, and investments in securities.
The financial statements have been prepared in accordance with accounting principles generally accepted in Hong
Kong. The principal accounting policies adopted are as follows:
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and its subsidiaries made
up to 31 December each year.
The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement
from the effective date of acquisition or up to the effective date of disposal, as appropriate.
All significant inter-company transactions and balances within the Group are eliminated on consolidation.
Goodwill and capital reserve
Goodwill or capital reserve arising on the acquisition of a subsidiary or an associate represents, respectively, the excess
or shortfall of the purchase consideration over the Group’s share of the fair value ascribed to the separable net assets
of the subsidiary or associate at the date of acquisition. Goodwill or capital reserve is written off or credited directly to
reserves in the year of acquisition.
On disposal of a subsidiary or an associate, the attributable amount of goodwill or capital reserve previously written off
against or credited to reserves at the time of acquisition is included in the determination of the profit or loss on
disposal.
Turnover
Turnover represents the net amounts received and receivable for goods sold to outside customers and the net proceeds
from sale of listed trading investments during the year.
Notes to the Financial Statements
for the Year Ended 31 December 2000

China Online (Bermuda)Limited
20
Notes to the Financial Statements
for the Year Ended 31 December 2000
2.Significant Accounting Policies (continued)
Revenue recognition
Trading of securities are recognised when the relevant transaction is executed.
Sales of goods are recognised when goods are delivered and title has passed.
Dividend income from investments is recognised when the Group’s rights to receive payment have been established.
Interest income is accrued on a time basis by reference to the principal outstanding and at the interest rate applicable.
Rental income, including rental invoiced in advance from properties let under operating leases, is recognised on a
straight line basis over the lease terms.
Investment properties
Investment properties are completed properties which are held for their investment potential, any rental income being
negotiated at arm’s length.
Investment properties are stated at their open market value based on independent professional valuations at the
balance sheet date. Any revaluation increase or decrease arising on the revaluation of investment properties is credited
or charged to the investment property revaluation reserve unless the balance on this reserve is insufficient to cover a
revaluation decrease, in which case the excess of the revaluation decrease over the balance on the investment property
revaluation reserve is charged as expense for the period. Where a revaluation decrease has previously been charged to
as expense and a revaluation increase subsequently arises, this increase is credited as income to the extent of the
decrease previously charged.
On disposal of an investment property, the balance on the investment property revaluation reserve attributable to that
property is included in profit or loss for the period.
No depreciation is provided on investment properties except where the unexpired term of the relevant lease is 20 years
or less.
Property, plant and equipment
Property, plant and equipment are stated at cost or valuation less depreciation and amortisation. The cost of an asset
comprises its purchase price and any directly attributable costs of bringing the asset to its working condition and
location for its intended use. Expenditure incurred after the assets has been put into operation, such as repairs and
maintenance and overhaul costs, is normally charged as expenses in the period in which it is incurred. In situations
where it can be clearly demonstrated that the expenditure has resulted in an increase in the future economic benefits
expected to be obtained from the use of the asset, the expenditure is capitalised as an additional cost of the asset.


Annual Report 2000
21
Notes to the Financial Statements
for the Year Ended 31 December 2000
2.Significant Accounting Policies (continued)
Property, plant and equipment - continued
Land and buildings are stated in the balance sheet at their revalued amount, being the fair value on the basis of their
existing use at the date of revaluation less any subsequent accumulated depreciation. Revaluations are performed
with sufficient regularity such that the carrying amount does not differ materially from that which would be determined
using fair values at the balance sheet date.
Any surplus arising on revaluation of land and buildings is credited to the revaluation reserve. A decrease in net
carrying amount arising on revaluation of land and buildings is charged as expenses to the extent that it exceeds the
surplus, if any, held in revaluation reserve relating to previous revaluation of that particular property. On the subsequent
sale of land and buildings, the attributable revaluation surplus not yet transferred to retained profits in prior years is
transferred to retained profits.
The gain or loss arising from disposal or retirement of an asset is determined as the difference between the sale
proceeds and the carrying amount of the asset and is included in net profit or loss for the period.
Where the recoverable amount of an asset has declined below its carrying amount, the carrying amount is reduced to
reflect the decline in value. In determining the recoverable amount of assets, expected future cash flows are not
discounted to their present values.
Depreciation is provided to write off the cost of property, plant and equipment over their estimated useful lives, using
the straight line method, at the following rates per annum:
Leasehold land Over the remaining lease terms
Buildings Over the shorter of the lease terms or 30-50 years
Computer and electronic equipment 20%
Furniture and fixtures 20% - 50%
Motor vehicles 20% - 50%
Subsidiaries
A subsidiary is an enterprise in which the Company, directly or indirectly, holds more than half of the issued share
capital, or controls more than half of the voting power, or where the Company controls the composition of its board
of directors or equivalent governing body.
Investments in subsidiaries are included in the Company’s balance sheet at cost, as reduced by any decline in the value
of the subsidiaries that is other than temporary. Results of subsidiaries are accounted for by the Company on the basis
of dividends received and receivable during the year.


China Online (Bermuda)Limited
22
Notes to the Financial Statements
for the Year Ended 31 December 2000
2.Significant Accounting Policies (continued)
Associates
An associate is an enterprise over which the Group is in a position to exercise significant influence, including participation
in financial and operational policy decisions.
The consolidated results includes the Group’s share of the post-acquisition results of its associates for the year. In the
consolidated balance sheet, interests in associates are stated at the Group’s share of the net assets of the associates.
Investments in associates are included in the Company’s balance sheet at cost, as reduced by any decline in the value
of the associates that is other than temporary. Results of associates are accounted for by the Company on the basis of
dividends received and receivable during the year.
When the Group transacts with its associates, unrealised profits and losses are eliminated to the extent of the Group’s
interest in the relevant associate, except where unrealised losses provide evidence of an impairment of the asset
transferred.
Investments in securities
Investments in securities are recognised on a trade-date basis and are initially measured at cost.
All securities other than held-to-maturity debt securities are measured at subsequent reporting dates at fair value.
Where securities are held for trading purposes, unrealised gains and losses are included in net profit or loss for the
period. For other securities held for non-trading purposes, unrealised gains and losses are dealt with in equity, until
the security is realised or is determined to be impaired, at which time the cumulative gain or loss is included in net
profit or loss for the period.
Inventories
Inventories, representing trade merchandise, are stated at the lower of cost and net realisable value. Cost, which
comprises all costs of purchase, and where applicable, other costs that have been incurred in bringing the inventories
to their present location and condition, is calculated using the first-in, first-out method. Net realisable value represents
the estimated selling price in the ordinary course of business less all estimated costs of completion and the estimated
costs necessary to make the sale.

Annual Report 2000
23
Notes to the Financial Statements
for the Year Ended 31 December 2000
2.Significant Accounting Policies (continued)
Taxation
The charge for taxation is based on the results for the year after adjusting for items which are non-assessable or
disallowed. Certain items of income and expense are recognised for tax purposes in a different accounting period
from that in which they are recognised in the financial statements. The tax effect of the resulting timing differences,
computed using the liability method, is recognised as deferred taxation in the financial statements to the extent that
it is probable that a liability or an asset will crystallise in the foreseeable future.
Operating leases
Rentals payable and receivable under operating leases are charged as expenses and credited as income on a straight
line basis over the terms of the relevant lease.
Retirement benefits scheme
The pension costs charged to the income statement represent the contributions payable in respect of the current year
to the Group’s defined contribution scheme.
Foreign currencies
Transactions in currencies other than Hong Kong dollars are translated into Hong Kong dollars at the rates ruling on
the dates of the transactions. Monetary assets and liabilities denominated in currencies other than Hong Kong dollars
are re-translated into Hong Kong dollars at the rates ruling on the balance sheet date. Gains and losses arising on
exchange are dealt with in net profit or loss for the period.
On consolidation, the financial statements denominated in currencies other than Hong Kong dollars are translated
into Hong Kong dollars at the exchange rates ruling on the balance sheet date. All exchange differences arising on
consolidation are dealt with in reserves.
Cash equivalents
Cash equivalents represent short term highly liquid investments which are readily convertible into known amounts of
cash and which were within three months of maturity when acquired; less advances from banks repayable within
three months from the date of the advance.


China Online (Bermuda)Limited
24
Notes to the Financial Statements
for the Year Ended 31 December 2000
3.Turnover and Contribution to Profit from Operations
An analysis of the Group’s turnover and contribution to profit from operations by principal activity for the year are as
follows:
Contribution to
Turnover profit from operations
2000 1999 2000 1999
HK$’000 HK$’000 HK$’000 HK$’000
Continuing operations
Mobile phone distribution 236,346 220,012 1,959 (639)
Telecommunication products 10,063 1,290 (18,145) (906)
Trading of securities 2,196,020 234,491 (256,643) 9,048
Others — 6,307 — (8,138)
2,442,429 462,100 (272,829) (635)
Net gains on investments 1,622,602 355,596
Gain on disposal of an associate 7,800 —
Provision in respect of distribution
network development costs in the
Mainland China (9,189) (95,133)
1,348,384 259,828
Discontinued operations
Paging services — 80,329 — (103,162)
Customer premises equipment — 53,842 — 9,286
Others — 14,552 — 6,505
— 148,723 — (87,371)
Cellular mobile telecommunication
network — 36,258
Gain on disposal of discontinued
operations, net — 95,680
— 44,567
Total 2,442,429 610,823 1,348,384 304,395
Over 90% of the Group’s turnover and related contribution to profit from operations are derived from activities in
Hong Kong, Special Administrative Region of the People’s Republic of China (“Hong Kong”), and the rest of the
operations are carried out in the Mainland China.

Annual Report 2000
25
Notes to the Financial Statements
for the Year Ended 31 December 2000
4.Net Gains on Investments
2000 1999
HK$’000 HK$’000
Gain on realisation of non-trading listed investments, after taking
into account of release of asset revaluation reserve of
HK$3,306,391,000 (note 27) 2,870,891 355,596
Net realised loss on equity linked notes (359,103) —
Net unrealised loss on trading investments (791,730) —
Impairment loss on non-trading investments (97,456) —
1,622,602 355,596
5.Discontinued Operations
In the prior year, the Group disposed of certain subsidiaries, whose principal activities comprised the development and
operation of a cellular mobile telecommunication network, and the marketing, and provision of technical support for
customer premises equipment. The Group also disposed of its paging business. These operations were accounted for
until the dates of their disposals, at which time the assets and liabilities of the subsidiaries and the business were
transferred to the gain on disposal of the discontinued operations, which was calculated as follows:
THE GROUP
2000 1999
HK$’000 HK$’000
Net gain on disposal/deemed disposal of interests in subsidiaries,
a subsidiary not consolidated and associates (note a) — 371,734
Less: goodwill previously written off against reserves — (296,901)
exchange reserve realised — (1,945)
— 72,888
Gain on disposal of business (note b) — 22,792
— 95,680
Notes:
(a) In respect of the year ended 31 December 1999, the net gain on disposal/deemed disposal of interests in subsidiaries and a subsidiary not
consolidated comprised (i) the net gain on dilution and partial disposal of the Group’s interest in Tricom Holdings Limited (“Tricom”, whose
name was changed to Pacific Century CyberWorks Limited (“PCCW”)) of HK$220,111,000; (ii) the loss on disposal of the Group’s interest in Star
Digitel Limited (“SDL”) of HK$150,437,000; and (iii) the gain on the disposals of the interests in other subsidiaries of HK$3,214,000.
(b) The amount represented the gain on the disposal of the Group’s business in the provision of paging services to China Moti

China Online (Bermuda)Limited
26
Notes to the Financial Statements
for the Year Ended 31 December 2000
6.Other Revenue
2000 1999
HK$’000 HK$’000
Dividend income from listed investments 26,739 —
Forfeited pension scheme contribution 542 10,161
Gross rental income from investment properties 1,653 3,479
Interest income 25,926 26,004
Write back of the provision for litigation — 36,258
Others 503 11,372
55,363 87,274
7.Profit from Operations
2000 1999
HK$’000 HK$’000
Profit from operations has been arrived at after charging:
Auditors’ remuneration 995 1,506
Cost of inventories recognised as expenses 219,660 220,262
Cost of services rendered — 80,540
Redundancy and severance payments 206 16,431
Deficit arising on revaluation of investment properties 1,350 2,650
Deficit on revaluation of land and buildings 2,395 19,897
Depreciation and amortisation 3,491 17,322
Loss on disposal of property, plant and equipment 706 2,709
Operating lease rentals in respect of rented premises 4,980 19,441
Provision for diminution in values of interests in associates — 9,057
Provision for diminution in value of property, plant and equipment — 16,321
Staff costs, inclusive of directors’ emoluments 13,525 43,345
8.Finance Costs
2000 1999
HK$’000 HK$’000
Interest on:
- bank and other borrowings wholly repayable within five years 13,723 5,273
- finance leases — 6
13,723 5,279on Telecom (H.K.)


Annual Report 2000
27
Notes to the Financial Statements
for the Year Ended 31 December 2000
9.Directors ’ Emoluments and Highest Paid Employees
Directors’ emoluments
The directors’ emoluments are analysed as follows:
2000 1999
HK$’000 HK$’000
Fees:
Executive directors — —
Independent non-executive directors 100 285
100 285
Other emoluments to executive directors:
Salaries and other benefits 193 1,162
Performance related bonus — 6,811
Retirement benefit scheme contribution — —
Total directors’ emoluments 293 8,258
The emoluments of the directors were within the following bands:
2000 1999
Number of Number of
directors directors
Nil to HK$1,000,000 5 10
HK$1,500,001 to HK$2,000,000 — 1
HK$4,500,001 to HK$5,000,000 — 1
Highest paid employees
During the current year, the five highest paid employees of the Group do not include any directors. In 1999, the five
highest paid employees of the Group included three directors, details of whose emoluments are set out above. The
emoluments of the five highest paid employees (1999: two employees) are as follows:
2000 1999
HK$’000 HK$’000
Salaries and other benefits 3,054 3,235
Performance related bonus — 100
Retirement benefit scheme contribution 80 154
3,134 3,489


China Online (Bermuda)Limited
28
Notes to the Financial Statements
for the Year Ended 31 December 2000
9.Directors ’ Emoluments and Highest Paid Employees ((continued)
The emoluments of the five (1999: two) highest paid employees were within the following bands:
2000 1999
Number of Number of
employees employees
Nil to HK$1,000,000 5 1
HK$2,500,001 to HK$3,000,000 — 1
10.Tax Credit (Charge)
2000 1999
HK$’000 HK$’000
The credit (charge) comprises:
Hong Kong Profits Tax
Current year — (2,615)
Overprovision in prior years 2,128 472
2,128 (2,143)
Tax in elsewhere — (436)
Share of taxation of an associate 33 —
2,161 (2,579)
No provision for Hong Kong Profits Tax has been made in the financial statements, as the Group has no assessable
profit for the current year.
Hong Kong Profits Tax was calculated at 16% on the estimated assessable profits in 1999.
Taxes on profits assessable elsewhere have been calculated at the rates of tax prevailing in the countries in which the
Group operates in 1999.
11.Profit for the Year
Of the Group’s profit for the year of HK$1,332,818,000 (1999: HK$260,381,000), a profit of HK$53,136,000
(1999: HK$396,141,000) has been dealt with in the financial statements of the Company.


Annual Report 2000
29
Notes to the Financial Statements
for the Year Ended 31 December 2000
12.Dividends
2000 1999
HK$’000 HK$’000
Proposed final of 0.5 HK cents (1999: nil) per ordinary share 46,432 —
Special interim of 2 HK cents per ordinary share — 181,854
46,432 181,854
The special interim dividend in 1999 had been adjusted for the one to ten shares subdivision on 30 July 1999.
The final dividend of 0.5 HK cents (1999: nil) per ordinary share has been proposed by the directors and is subject to
approval by shareholders in general meeting.
13.Earnings Per Share
The calculation of basic and diluted earnings per share is based on the following data:
2000 1999
HK$’000 HK$’000
Earnings for the purpose of basic and diluted earnings per share 1,332,818 260,381
Number of shares Number of shares
Weighted average number of ordinary shares for the
purposes of basic earnings per share 9,284,793,767 9,114,936,517
Effect of dilutive potential shares:
Options 855,804
Weighted average number of ordinary shares for
the purposes of diluted earnings per share 9,285,649,571
Diluted earning per share for the year ended 31 December 1999 had not been presented as no dilutive potential
ordinary shares were outstanding.
14.Investment Properties
THE GROUP
2000
HK$’000
At 1 January 2000 16,750
Deficit arising on revaluation (1,350)
At 31 December 2000 15,400
The Group’s investment properties are situated in Hong Kong and are held under medium term leases. They were
revalued at 31 December 2000 by DTZ Debenham Tie Leung Limited, a firm of independent professional property
valuers, at HK$15,400,000 on an open market, existing use basis. The resulting deficit arising on the revaluation of
HK$1,350,000 (1999: HK$2,650,000) has been charged to the consolidated income statement.
As at 31 December 1999, certain of the Group’s investment properties with an aggregate carrying value of approximately
HK$14,500,000 were pledged to secure general banking facilities granted to the Group. This charge had been released
during the year.


China Online (Bermuda)Limited
30
Notes to the Financial Statements
for the Year Ended 31 December 2000
15.Property,Plant and Equipment
Computer
Leasehold and Furniture
land and electronic and Motor
buildings equipment fixtures vehicles Total
HK$’000 HK$’000 HK$’000 HK$’000 HK$’000
THE GROUP
COST OR VALUATION:
At 1 January 2000 34,650 5,492 8,159 745 49,046
Additions — 2,327 4,074 1,022 7,423
Disposals — (2,073) (4,151) (145) (6,369)
Deficit arising on revaluation (2,750) — — — (2,750)
At 31 December 2000 31,900 5,746 8,082 1,622 47,350
COMPRISING:
At cost — 5,746 8,082 1,622 15,450
At valuation - 2000 31,900 — — — 31,900
31,900 5,746 8,082 1,622 47,350
DEPRECIATION AND
AMORTISATION:
At 1 January 2000 — 2,160 5,376 745 8,281
Provided for the year 355 2,112 779 245 3,491
Eliminated on disposals — (2,001) (3,369) (145) (5,515)
Eliminated on valuation (355) — — — (355)
At 31 December 2000 — 2,271 2,786 845 5,902
NET BOOK VALUES:
At 31 December 2000 31,900 3,475 5,296 777 41,448
At 31 December 1999 34,650 3,332 2,783 — 40,765
The land and buildings of the Group are analysed as follows:
THE GROUP
2000 1999
HK$’000 HK$’000
Properties situated in Hong Kong, held under medium term leases 8,100 8,750
Properties situated in the Mainland China, held under:
- long leases 3,100 3,700
- medium term leases 20,700 22,200
31,900 34,650

Annual Report 2000
31
Notes to the Financial Statements
for the Year Ended 31 December 2000
15.Property,Plant and Equipment (continued)
All the land and buildings of the Group were revalued at 31 December 2000 by DTZ Debenham Tie Leung Limited, a
firm of independent professional property valuers, on an open market value basis. The resulting deficit arising on the
revaluation of HK$2,395,000 (1999: HK$19,897,000) has been charged to the consolidated income statement.
Had all the land and buildings of the Group been carried at cost less accumulated depreciation and amortisation, the
carrying values of these properties would have been stated at HK$51,423,000 (1999: HK$52,834,000).
16.Interests in Subsidiaries
THE COMPANY
2000 1999
HK$’000 HK$’000
Unlisted shares, at cost 32,168 32,168
Amounts due from subsidiaries 3,428,946 1,207,487
3,461,114 1,239,655
Less: Impairment loss recognised (63,524) (119,140)
3,397,590 1,120,515
Particulars of the principal subsidiaries as at 31 December 2000 are set out in note 42.
In the opinion of the directors, the amounts due from subsidiaries will not be repaid within twelve months from the
balance sheet date. Accordingly, it is classified as non-current.
17.Interests in Associates
THE GROUP
2000 1999
HK$’000 HK$’000
Share of net assets 73,056 9,507
Less: Impairment loss recognised (7,812) (9,507)
65,244 —
Particulars of the principal associate as at 31 December 2000 are set out in note 43.


China Online (Bermuda)Limited
32
Notes to the Financial Statements
for the Year Ended 31 December 2000
18.Investments in Securities
THE GROUP
Trading investments Non-trading investments Total
2000 1999 2000 1999 2000 1999
HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000
Equity securities
- listed in Hong Kong 1,395,154 — 430,447 3,620,000 1,825,601 3,620,000
- unlisted 492,175 — 6,000 — 498,175 —
1,887,329 — 436,447 3,620,000 2,323,776 3,620,000
Carrying amount analysed
for reporting purposes as
- Non-current — — 339,638 3,620,000 339,638 3,620,000
- Current 1,887,329 — 96,809 — 1,984,138 —
1,887,329 — 436,447 3,620,000 2,323,776 3,620,000
Market value of listed
securities 1,395,154 — 430,447 3,620,000 1,825,601 3,620,000
As at 31 December 2000, included in the equity securities shown above, the Group has interests in the following
companies, the details of which are disclosed pursuant to Section 129 of the Hong Kong Companies Ordinance as
follows:
Percentage of
issued share
Place of Class of capital held
Name of company incorporation shares by the Group
Sun Hung Kai & Co. Limited Hong Kong Ordinary 19.3%
PCCW Hong Kong Ordinary 0.67%
19.Inventories
THE GROUP
2000 1999
HK$’000 HK$’000
Inventories held for resale 8,966 9,685
At 31 December 1999, inventories of HK$119,000 were carried at net realisable value.


Annual Report 2000
33
Notes to the Financial Statements
for the Year Ended 31 December 2000
20.Debtors,Deposits and Prepayments
The Group has a policy of allowing an average credit period of 30-90 days to its trade customers.
An aged analysis of trade debtors is as follows:
THE GROUP
2000 1999
HK$’000 HK$’000
Within 90 days 5,688 2,516
91 – 180 days 41 237
181 – 360 days — 198
Over 360 days — 1,108
5,729 4,059
Other debtors, deposits and prepayments 23,007 47,844
28,736 51,903
21.Creditors and Accrued Charges
An aged analysis of trade creditors is as follow:
THE GROUP
2000 1999
HK$’000 HK$’000
Within 90 days 999 7,035
91 – 180 days 121 6,235
181 – 360 days 3,064 269
Over 360 days 3,849 3,858
8,033 17,397
Other creditors and accrued charges 157,989 141,093
166,022 158,490

China Online (Bermuda)Limited
34
Notes to the Financial Statements
for the Year Ended 31 December 2000
22.Bank Borrowings
THE GROUP
2000 1999
HK$’000 HK$’000
Bank borrowings comprise:
Short term bank loan - secured 265,519 679
Bank overdrafts — 18
265,519 697
23.Amounts Due to Subsidiaries
The amounts are unsecured, interest free and have no fixed terms of repayment. Repayment of the amounts will not
be demanded within the next twelve months from the balance sheet date. Accordingly, the amounts are shown as
non-current.
24.Share Capital
Number of shares Value
2000 1999 2000 1999
HK$’000 HK$’000
Ordinary shares of HK$0.01
(before 30 July 1999: HK$0.1) each
Authorised:
At beginning of the year 15,000,000,000 1,500,000,000 150,000 150,000
Subdivision of shares (note c) — 13,500,000,000 — —
Increase during the year 15,000,000,000 — 150,000 —
At end of the year 30,000,000,000 15,000,000,000 300,000 150,000
Issued and fully paid:
At beginning of the year 9,279,190,490 910,654,049 92,792 91,065
Shares repurchased (note a) — (1,310,000) — (131)
Share options exercised (note b) — 1,500,000 — 150
9,279,190,490 910,844,049 92,792 91,084
Subdivision of shares (note c) — 8,197,596,441 — —
Share options exercised (note d) 7,250,000 170,750,000 72 1,708
Warrants exercised (note e) 21,250 — 1 —
At end of the year 9,286,461,740 9,279,190,490 92,865 92,792

Annual Report 2000
35
Notes to the Financial Statements
for the Year Ended 31 December 2000
24.Share Capital (continued)
Notes:
(a) In January 1999, the Company repurchased its own shares through the Stock Exchange totalling 1,310,000 shares for an aggregate consideration
of HK$649,000. The highest and the lowest prices per share paid by the Company in the purchase were HK$0.55 and HK$0.40, respectively.
The directors considered that, as the Company’s shares were traded at a discount to the expected net asset value per share, the purchases would
be beneficial to the Company.
These repurchased shares were cancelled upon repurchase and, accordingly, the issued share capital of the Company was reduced by the
nominal value of these shares. The premium payable on repurchase was charged against the share premium account.
(b) On

[dirko]

2. Teil
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Annual Report 2000
35
Notes to the Financial Statements
for the Year Ended 31 December 2000
24.Share Capital (continued)
Notes:
(a) In January 1999, the Company repurchased its own shares through the Stock Exchange totalling 1,310,000 shares for an aggregate consideration
of HK$649,000. The highest and the lowest prices per share paid by the Company in the purchase were HK$0.55 and HK$0.40, respectively.
The directors considered that, as the Company’s shares were traded at a discount to the expected net asset value per share, the purchases would
be beneficial to the Company.
These repurchased shares were cancelled upon repurchase and, accordingly, the issued share capital of the Company was reduced by the
nominal value of these shares. The premium payable on repurchase was charged against the share premium account.
(b) On 28 July 1999, the subscription rights attaching to 1,500,000 share options were exercised at the subscription price of HK$1.29 per share.
(c) Pursuant to an ordinary resolution passed on 29 July 1999, the issued and unissued share capital of the Company were subdivided from the one
share of HK$0.10 each into the ten shares of HK$0.01 each with effect from 30 July 1999.
(d) Subsequent to the subdivision of shares, share options were exercised to subscribe for 68,750,000, 52,000,000 and 50,000,000 ordinary shares
of the Company at exercise prices of HK$0.240, HK$0.129 and HK$0.133 per share, respectively.
During the year, share options were exercised to subscribe for 4,250,000 and 3,000,000 ordinary shares of the Company at an exercise price of
HK$0.240 and HK$0.129 per share, respectively.
(e) During the year, warrants were exercised to subscribe for 21,250 ordinary shares of the Company at an exercise price of HK$0.30 per share.
25.Warrants
During the year, 1,856,688,098 warrants were issued at HK$0.05 on the basis of one warrant for every five ordinary
shares held on 15 May 2000. Each warrant entitles the holder to subscribe in cash at a price of HK$0.30 each, subject
to adjustment, for one ordinary share in the Company, at any time from the date of issue up to 6 June 2003 (both days
inclusive).
26.Share Option Scheme
Pursuant to the Company’s share option scheme adopted on 10 July 1991, the board of directors of the Company
may, at its discretion, grant options to eligible employees, including directors, of the Company or any of its subsidiaries
to subscribe for shares in the Company at a price which is 80% of the average of the closing prices of the shares on the
Stock Exchange on the five trading days immediately preceding the date of granting the options or the nominal value
of the shares, whichever is the higher.
The maximum number of shares in respect of which options may be granted under the share option scheme shall not
exceed 10% of the issued share capital of the Company from time to time.
The options previously granted were exercisable during the one-year period commencing one year after the date on
which the options were accepted. An amendment was passed at a special general meeting of the Company on 2 April
1997 to alter the definition of the option period as up to a maximum of ten years, as may be decided by the board of
directors, after the date of acceptance of the options.
Pursuant to an ordinary resolution passed on 29 July 1999, the issued and unissued shares of the Company were
subdivided from the one share of HK$0.10 each into the ten shares of HK$0.01 each with effect from 30 July 1999.
The share options were subdivided in the same manner accordingly.


China Online (Bermuda)Limited
36
Notes to the Financial Statements
for the Year Ended 31 December 2000
26.Share Option Scheme (continued)
A summary of the movements in share options granted under the share option scheme during the year is as follows:
Number of option shares
Balance Exercised Cancelled Balance
Exercise at during during at
Exercisable period Capacity price 1.1.2000 the year the year 31.12.2000
HK$
20 January 1998
to 19 January 2001 Employee 0.240 6,250,000 (4,250,000) (2,000,000) —
2 June 1999 to
1 June 2002 Employee 0.129 3,000,000 (3,000,000) — —
9,250,000 (7,250,000) (2,000,000) —



Annual Report 2000
37
Notes to the Financial Statements
for the Year Ended 31 December 2000
27.Reserves
Capital Asset Capital Retained
Share reserve Warrant revaluation redemption Translation profits
premium (goodwill) reserve reserve reserve reserve (deficit) Total
HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000
THE GROUP
At 1 January 1999 1,104,926 (264,018) — — 1,791 (1,078) (595,749) 245,872
Currency realignment — — — — — 1,672 — 1,672
Premium arising on issue
of shares 29,935 — — — — — — 29,935
Shares repurchased and
cancelled (518) — — — 131 — (131) (518)
Released on disposal/
deemed disposal of
subsidiaries/associates/
unconsolidated subsidiary — 296,901 — — — 1,945 — 298,846
Revaluation surplus of
non-trading investments — — — 3,471,277 — — — 3,471,277
Profit for the year — — — — — — 260,381 260,381
Dividends — — — — — — (181,854) (181,854)
At 31 December 1999 1,134,343 32,883 — 3,471,277 1,922 2,539 (517,353) 4,125,611
Net premium arising on issue
of warrants — — 90,382 — — — — 90,382
Goodwill arising on acquisition
of an associate — (30,035) — — — — — (30,035)
Goodwill on acquisition of a
subsidiary — (569) — — — — — (569)
Share of reserve of an associate — (668) — — — 70 — (598)
Premium arising on issue
of shares 1,341 — — — — — — 1,341
Transfer 1 — (1) — — — — —
Released on realisation of
non-trading investments — — — (3,306,391) — — — (3,306,391)
Revaluation deficit of
non-trading investments — — — (229,223) — — — (229,223)
Profit for the year — — — — — — 1,332,818 1,332,818
Dividends — — — — — — (46,432) (46,432)
At 31 December 2000 1,135,685 1,611 90,381 (64,337) 1,922 2,609 769,033 1,936,904
Attributable to:
Company and subsidiaries 1,135,685 2,279 90,381 (64,337) 1,922 2,539 810,983 1,979,452
Associates — (668) — — — 70 (41,950) (42,548)
1,135,685 1,611 90,381 (64,337) 1,922 2,609 769,033 1,936,904



China Online (Bermuda)Limited
38
Notes to the Financial Statements
for the Year Ended 31 December 2000
27.Reserves (continued)
Capital Retained
Share Contributed redemption Warrant profits
premium surplus reserve reserve (deficit) Total
HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000
THE COMPANY
At 1 January 1999 1,104,926 32,883 1,791 — (186,384) 953,216
Premium arising on issue of shares 29,935 — — — — 29,935
Shares repurchased and cancelled (518) — 131 — (131) (518)
Profit for the year — — — — 396,141 396,141
Dividend — — — — (181,854) (181,854)
At 31 December 1999 1,134,343 32,883 1,922 — 27,772 1,196,920
Net premium arising from issue
of warrants — — — 90,382 — 90,382
Premium arising on issue of shares 1,341 — — — — 1,341
Transfer 1 — — (1) — —
Profit for the year — — — — 53,136 53,136
Dividends — — — — (46,432) (46,432)
At 31 December 2000 1,135,685 32,883 1,922 90,381 34,476 1,295,347
Notes:
The contributed surplus of the Company represents the difference between the nominal value of the Company’s shares issued at the date on which the
group reorganisation became effective, in exchange for the shares of the subsidiaries, and the underlying net assets of the subsidiaries acquired, less
distributions subsequently made to the Company.
In addition to retained profits of the Company, under the Companies Act 1981 of Bermuda (as amended), the contributed surplus is also available for
distribution to shareholders. However, a company cannot declare or pay a dividend, or make a distribution out of contributed surplus, if:
(a) the company is, or would after the payment be, unable to pay its liabilities as they become due; or
(b) the realisable value of the company’s assets would thereby be less than the aggregate of its liabilities and its issued share capital and share
premium account.
In the opinion of the directors, the Company’s reserves available for distribution to shareholders as at the balance
sheet date were as follows:
2000 1999
HK$’000 HK$’000
Contributed surplus 32,883 32,883
Retained profits 34,476 27,772
67,359 60,655

Annual Report 2000
39
Notes to the Financial Statements
for the Year Ended 31 December 2000
28.Deferred Taxation
The unrecognised potential deferred tax credit of the Group for the year is HK$10,096,000 (1999: charge of HK$31,124,000),
which comprises mainly the tax effect of timing differences arising from tax losses arising/utilised.
As at 31 December 2000, the potential deferred taxation asset not recognised in the financial statements of the Group
is HK$23,614,000 (1999: HK$13,518,000), which comprises mainly the tax effect of timing differences arising from
tax losses available to set off against future assessable profit.
The potential deferred taxation in respect of timing differences has not been recognised in the financial statements as
it is not certain that the benefit will crystallise in the foreseeable future.
The Company did not have any significant unprovided deferred taxation at the balance sheet date or during the year.
29.Reconciliation of Profit before Taxation to Net Cash Outflow from Operating Activities
2000 1999
HK$’000 HK$’000
Profit before taxation 1,333,777 257,344
Dividend income (26,739) —
Interest income (25,926) (26,004)
Interest expense 13,723 5,279
Net gain on realisation/disposal of investments in securities (2,870,891) (365,093)
Gain on disposal of discontinued operations, net — (95,680)
Gain on disposal of an associate (7,800) —
Depreciation of property, plant and equipment 3,491 17,322
Deficit arising on revaluation of investment properties 1,350 2,650
Deficit arising on revaluation of leasehold land and buildings 2,395 19,897
Loss on disposal of property, plant and equipment 706 2,709
Net realised loss on equity linked notes 359,103 —
Net unrealised loss on trading investments 791,730 —
Impairment loss on non-trading investments 97,456 —
Share of results of unconsolidated subsidiaries — 11,845
Share of results of associates 884 29,927
Provisions for diminutions in values of property, plant and equipment — 16,321
Provisions for diminutions in values of interests in associates — 9,057
Provision in respect of distribution network development costs
in Mainland China 9,189 95,133
Decrease (increase) in inventories 719 (1,833)
Decrease in debtors, deposits and prepayments 25,724 76,437
Increase in investments in securities (3,086,996) —
Increase (decrease) in creditors and accrued charges 7,405 (157,942)
Increase (decrease) in customers’ deposits and receipts in advance 5,134 (21,807)
Net cash outflow from operating activities (3,365,566) (124,438)


China Online (Bermuda)Limited
40
Notes to the Financial Statements
for the Year Ended 31 December 2000
30.Purchase of a Subsidiary
During the year the Group acquired 100% of the issued share capital of Fortune Focus Holdings Limited for a
consideration of HK$3,000,000. This acquisition has been accounted for by the acquisition method of accounting.
The amount of goodwill arising as a result of the acquisition was approximately HK$569,000. The loss after taxation
of Fortune Focus Holdings Limited included in the consolidated income statement for the year ended 31 December
2000 amounted to HK$2,907,000.
2000 1999
HK$’000 HK$’000
NET ASSETS ACQUIRED
Debtors, deposits and prepayments 2,557 —
Bank balances and cash 1 —
Creditor and accrued charges (127) —
2,431 —
Goodwill 569 —
Satisfied by cash 3,000 —
Net cash outflow arising on acquisition:
Cash consideration 3,000 —
Bank balances and cash 1 —
Net outflow of cash and cash equivalents in
respect of the purchase of a subsidiary 2,999 —
The subsidiary acquired during the year did not make a material contribution to the Group’s net operating cash flows
and turnover.



Annual Report 2000
41
Notes to the Financial Statements
for the Year Ended 31 December 2000
31.Disposal of Subsidiaries and Businesses
2000 1999
HK$’000 HK$’000
Net assets disposed of:
Property, plant and equipment — 153,155
Interests in associates — (1,254)
Other non-current assets — 10,415
Inventories — 83,488
Debtors, deposits and prepayments — 42,998
Bank balances and cash — 15,775
Creditors and accrued charges — (112,282)
Customers’ deposits and receipts in advance — (19,802)
Taxation — (3,274)
Bank borrowings — (30,602)
Deferred taxation — (1,081)
Minority interests — (25,755)
— 111,781
Release of goodwill reserve — 239,805
Release of translation reserve — 1,945
Gain on disposal — 246,117
— 599,648
Satisfied by:
Cash consideration — 505,845
Other receivable included in current assets — 2,033
The Group’s share of net assets in Tricom — 91,770
— 599,648
Analysis of the net inflows of cash and cash equivalents in connection with the disposal of subsidiaries and business is
as follows:
2000 1999
HK$’000 HK$’000
Cash consideration received — 505,845
Bank balances and cash disposed of — (15,775)
— 490,070
The subsidiaries and business disposed of in 1999 contributed HK$38 million to the Group’s net operating cash
outflows, paid HK$2 million in respect of the net returns on investments and servicing of finance, received a tax refund
of HK$8 million, received HK$11 million for investing activities and received HK$4 million in respect of financing
activities.
The results of the subsidiaries and business disposed of during 1999 contributed HK$149 million to turnover and a loss
of HK$87 million to the consolidated profit after taxation and before minority interests.




China Online (Bermuda)Limited
42
Notes to the Financial Statements
for the Year Ended 31 December 2000
32.Analysis of Changes in Financing During the Year
Obligations Advances
Share capital Bank under from ultimate
and and other finance holding Minority Warrant
premium borrowings leases company interests reserve
HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000
Balance at 1 January 1999 1,195,991 78,340 1,037 2,468 31,946 —
Proceeds from issue of shares 31,793 — — — — —
Repurchase of own shares (649) — — — — —
New loans raised during the year — 9,347 — — — —
Repayment during the year — (56,406) (1,037) (2,468) — —
Reversal of minority interests due
to disposal/dilution of interests
in subsidiaries — — — — (25,755) —
Minorities share of losses of
subsidiaries — — — — (5,616) —
Reduction in bank borrowings as
a result of disposal of interest
in a subsidiary — (30,602) — — — —
Balance at 31 December 1999 1,227,135 679 — — 575 —
Proceeds from issue of shares upon
exercise of options 1,407 — — — — —
Proceeds from issue of shares upon
exercise of warrants 7 — — — — —
Issue of warrants — — — — — 90,382
New loan raised during the year — 1,397,866 — — — —
Repayment during the year — (1,140,255) — — — —
Interest accrued — 7,229 — — — —
Transfer 1 — — — — (1)
Minorities share of profit of
subsidiaries — — — — 3,120 —
Balance at 31 December 2000 1,228,550 265,519 — — 3,695 90,381


Annual Report 2000
43
Notes to the Financial Statements
for the Year Ended 31 December 2000
33.Analysis of the Balances of Cash and Cash Equivalents
2000 1999
HK$’000 HK$’000
Bank balances and cash 37,010 632,232
Bank overdrafts — (18)
37,010 632,214
34.Major Non-cash Transactions
In prior year, the Group’s interest in Tricom was diluted from approximately 74.87% to approximately 4.12% following
the completion of certain transactions, which included the placements of existing and new shares, and the then new
shares issue for a substantial acquisition of a company from Pacific Century Regional Development Limited and Pacific
Century Group Holdings Limited, companies in which Mr. Li Tzar Kai, Richard is the controlling shareholder. This
resulted in a dilution gain of HK$220,111,000.
35.Contingent Liabilities
(a) The Company has given guarantees to banks in respect of general facilities granted to a subsidiary. The extent of
facilities utilised by the subsidiary at 31 December 2000 amounted to approximately HK$122,612,000 (1999:
nil).
In addition, the Company has also provided guarantees to several securities houses in respect of the facilities
granted to its subsidiaries.
(b) In respect of the disposal of a subsidiary in prior years, the Group has given an indemnity to the purchaser against
all liabilities, losses, costs and expenses suffered and/or incurred by the purchaser in relation to or arising out of
the assignment of certain of the subsidiary’s business contracts.
(c) In 1997, the Company had given a counter-indemnity to a former substantial shareholder and the ex-chairman
of Tricom, and Chambord Investment Inc. in respect of certain indemnities given to Tricom at the time of and to
facilitate the listing of Tricom’s shares on the Stock Exchange. These indemnities related to the use of the Tricom
tradename, the infringement of the permitted use of properties, the guarantees granted to Tricom to secure
banking facilities and tax liabilities.
In respect of (b) and (c) above, the directors were not able to estimate the financial effect of the indemnities and
warranty given.


China Online (Bermuda)Limited
44
Notes to the Financial Statements
for the Year Ended 31 December 2000
36.Litigations
(a) Mr. Wong Yick Man, Francis, the ex-managing director and ex-chief executive officer of the Company, who was
removed as a director on 10 January 1997, has claimed against the Company on the basis that he was entitled to
be paid salary for the remaining period of his employment agreement, the loss of stock options, and outstanding
holiday entitlements. The aggregate amount of the various elements of his claim is approximately
HK$12,000,000 together with interest thereon and legal costs. The Group strongly disputes these claims and has
taken legal advice. On 29 March 2000, Mr. Wong filed with the court an application to set the case down for
trial. The claims were fixed to be heard in the High Court in October 2000 and was dismissed in November 2000.
Mr. Wong Yick Man, Francis further appealed to the High Court and the hearing will be held on 26 July 2001. Full
provision of HK12,000,000 has been made in the financial statements.
(b) In November 1998, a writ was issued against the Company’s subsidiaries, Hongkong Digital Television Limited
(“Digital TV”, formerly Star Interactive Television Limited) and Star Telecom Services Limited (“STSL”, formerly
Hong Kong Star Internet Limited) by nCube, claiming the sum of approximately US$1,980,000 (equivalent to
approximately HK$15,305,000) plus interest in relation to the alleged purchase of two MediaCube 3000 systems
by Digital TV from nCube. The claim of nCube against STSL is on the basis of a chop of STSL on the contract
between Digital TV and nCube. STSL has taken legal advice and has been advised that it is very unlikely that STSL
would be held liable to the claim of nCube. Digital TV is also opposing the claim of nCube and has taken legal
advice.
As advised by its lawyers, Digital TV has reasonable grounds in defending the claim and, accordingly, has not
made any provision in the financial statements in connection with the claim. Digital TV filed a defence in this
section on 14 December 1998 and nCube has failed to further the action since that date.
(c) Stellar One Corporation (“Stellar One”) served a statutory demand under Section 178 of the Hong Kong Companies
Ordinance for the sum of approximately US$1,152,000 (equivalent to approximately HK$8,983,000) upon Digital
TV in November 1998. Stellar One filed a winding up petition against Digital TV in December 1998 which was
vigorously opposed by Digital TV. Digital TV applied for an order for security for the costs against Stellar One. On
4 May 1999, the Court ordered Stellar One to pay HK$200,000 to the court as security for the costs of Digital TV
on or before 7 May 1999. Stellar One failed to pay that amount to the court.
The petition was dismissed in November 1999 and Stellar One is to pay Digital TV its cost of the petition, which
amounts to HK$253,952. Stellar One has indicated that it will proceed to arbitration in Honolulu to recover the
alleged amount.
Digital TV took legal advice and was advised that the arbitration proceedings had not commenced as of the date
of approval of these financial statements. As advised by its lawyers, Digital TV has reasonable grounds in defending
the claims and, accordingly, has not made any provision in the financial statements in connection with the claims.
Save and except for the matters specified above, neither the Company nor any of its subsidiaries and associates is
engaged in any litigation or claims of material importance and, so far as the directors of the Company are aware, no
litigation or claims of material importance are pending or threatened by or against any companies of the Group.


Annual Report 2000
45
Notes to the Financial Statements
for the Year Ended 31 December 2000
37.Pledge of Assets
At the balance sheet date, the following assets of the Group were pledged to banks to secure short term banking
facilities:
THE GROUP
2000 1999
HK$’000 HK$’000
Marketable securities 1,425,212 —
Investment properties — 14,500
Bank deposits — 10,296
38.Capital Commitments
The Group and the Company have no significant capital commitments at the balance sheet date.
39.Operating Lease Commitments
At the balance sheet date, the Group had commitments to make payment within the following year under non-cancellable
operating leases in respect of rented premises as follows:
THE GROUP
2000 1999
HK$’000 HK$’000
Operating leases which expire:
Within one year — 1,139
In the second to fifth year inclusive 8,591 —
8,591 1,139
The Company did not have any significant lease commitments as at 31 December 2000 and 1999.
40.Retirement Benefit Scheme
The Group operates a defined contribution retirement benefit scheme for its qualifying employees in Hong Kong. The
assets of the scheme are held separately from those of the Group in funds under the control of independent trustee.
The retirement benefit scheme contributions charged to the income statement represent contributions payable to the
scheme by the Group at rates specified in the rules of the scheme. Where there are employees who leave the scheme
prior to vesting fully in the contributions, the amount of the forfeited contributions will be used to reduce future
contributions payable by the Group or will be refunded to the Company upon request.
During the year, the retirement benefits scheme contribution net of forfeited contribution approximately of
HK$493,000 (1999: HK$417,000) amount to HK$378,000 (1999: HK$1,137,000).
In addition to the defined contribution retirement benefit scheme, the Group is required to contribute to Mandatory
Provident Fund for certain employees commencing from 1 December 2000.
As at 31 December 2000, there was no forfeited contributions, which arose upon employees leaving the scheme and
which were available to reduce the contributions payable by the Group in the future years (1999:HK$318,000).

China Online (Bermuda)Limited
46
Notes to the Financial Statements
for the Year Ended 31 December 2000
41.Related Party Transactions
(a) On 2 June 2000, the Company issued a total of 637,148,000 warrants of the Company to Harbour Fair Overseas
Limited and Vigor Online Offshore Limited, both of which are wholly-owned subsidiaries of China Sci-Tech
Holdings Limited (“CST”), a substantial shareholder of the Company, at a price of HK$0.05 per warrant on the
basis of one warrant for every five existing shares held. Additionally, Cyber Range Limited, a wholly-owned
subsidiary of CST, subscribed 890,292,547 warrants of the Company on the same date pursuant to an underwriting
agreement dated 24 March 2000, which was subsequently amended by a supplemental agreement dated
18 April 2000. The total underwriting commission paid to CST was HK$1,526,000 based on 2.5% of the total
issue price of the warrants underwritten by CST.
(b) In 2000, the Company paid a reimbursement of expenses of HK$6,000,000 to CST. The reimbursement includes
(i) salaries of two directors of the Company, both of them also being the directors of CST; (ii) other staff costs;
and (iii) daily operating expenses. The reimbursement is based on the actual costs incurred by CST.
(c) In 1999, the Group disposed of its entire interests in certain subsidiaries and a subsidiary not consolidated to
Mr. Wong Kam Fu (“Mr. Wong”), a former executive director who resigned on 9 July 1999. Details of these
transactions with Mr. Wong are set out below:
(i) Star Telecom Holding Limited (“STHL”), a wholly-owned subsidiary of the Company, entered into a conditional
agreement dated 9 July 1999 with Electric World Holdings Limited (“EWHL”), a company being 45% owned
by Mr. Wong, to dispose of approximately 71.09% interest in SDL, together with the outstanding shareholder’s
loans, for a consideration of HK$97,500,000.
SDL is primarily engaged in the development and construction of cellular mobile telecommunications network
and the provision of related technical and support services, and the sale of telecommunications equipment
in the Mainland China.
Part of the consideration of HK$500,000 was settled by cash on signing of the conditional agreement. The
balance of HK$97,000,000 would be settled by two promissory notes issued by EWHL with
HK$48,500,000 each and being respectively due on 9 July 2002 and 9 July 2004. The promissory notes are
non-interest bearing. The obligation of EWHL under the said two promissory notes are secured by a share
charge in favour of STHL over the said disposal shares of SDL. According to the conditional agreement,
EWHL granted to the Group a call option to purchase 50% of the shares of SDL sold at a consideration of
HK$48,500,000 in a five-year period from the date of the conditional agreement. The transaction was
completed on 6 September 1999.
As at 31 December 1999, the directors considered that the balance of HK$97,000,000 due and owing by
EWHL in connection with the disposal of SDL may not be recoverable and has been fully provided for. The
provision was included in the loss on the disposal of SDL in that year.


Annual Report 2000
47
Notes to the Financial Statements
for the Year Ended 31 December 2000
41.Related Party Transactions (continued)
(ii) On 9 July 1999, STHL entered into another conditional agreement with Beeapple Holdings Limited, a company
wholly-owned by Mr. Wong, to dispose of its entire interest in Star Paging Telecom Technology (Shen Zhen)
Co., Ltd. (“Star Shenzhen”), together with the outstanding shareholder’s loans, for a consideration of
HK$12,000,000. Star Shenzhen was engaged in the manufacturing and sale of telecommunications products
and, through its subsidiaries, held interests in paging networks and operations in several cities in the Mainland
China. The transaction was completed on 6 September 1999 and the total amount of consideration was
fully settled.
(iii) On 9 July 1999, STHL entered into another conditional agreement with High Stone Assets Limited, a company
wholly-owned by Mr. Wong, to dispose of its entire interest in Cosmos Wealth Investment Limited (“Cosmos”),
together with the outstanding shareholder’s loans, for a consideration of HK$2,000,000. Cosmos held
commercial and residential properties in Shenzhen, the Mainland China.
The consideration was paid in cash on signing of the conditional agreement. The transaction was completed
on 6 September 1999.
(iv) On 16 June 1999, STHL entered into a sale and purchase agreement with Redbirds Winners Inc., a company
wholly-owned by Mr. Wong, to dispose of its entire interest in Star Paging, Inc. (“SPI”), together with the
outstanding shareholder’s loans, for an aggregate consideration of HK$3,110,000. SPI held a residential
property in Canada.
The consideration was paid in cash at the date of completion. The transaction was completed on 16 June
1999.
(v) On 4 August 1999, STSL, a wholly-owned subsidiary of the Company, entered into a sale and purchase
agreement with Starstruck Group Limited, a company wholly-owned by Mr. Wong, to dispose of its entire
interest in Star Internet Financial Information Services Limited (“SIFISL”), together with the outstanding
shareholder’s loans and the assignment of the rights to use the assets of Star Telecom Limited, another
wholly-owned subsidiary of the Company, for an aggregate consideration of HK$1,000,001. SIFISL was
principally engaged in the provision of financial information services.
The consideration was paid in cash at the date of completion. The transaction was completed on 4 August
1999.
(d) In 1999, the Group provided subordinated shareholder’s loans of HK$127,639,000 and had an accumulated
intercompany balance of HK$254,245,000 due by SDL. The loans were subordinated to loans due by SDL to
financial institutions. On disposal of SDL, the loans and the accumulated intercompany balance with the Group
were assigned to an associate of Mr. Wong.
The subordinated shareholder’s loans bore interest at 1% per month while the intercompany balance was interest-free.
There was no interest receivable recorded in respect of the subordinated shareholder’s loans which were
granted before disposal in 1999.






China Online (Bermuda)Limited
48
Notes to the Financial Statements
for the Year Ended 31 December 2000
42.Particulars of Principal Subsidiaries
Particulars of the principal subsidiaries as at 31 December 2000 are as follows:
Nominal value
of issued Percentage
Place of ordinary share/ of equity
incorporation/ registered attributable to
Name of subsidiary registration capital the Company Principal activities
Directly held
Energetic Resources The British Ordinary 100% Investment holding
Limited Virgin Islands US$1
Star Paging (BVI) Limited The British Ordinary 100% Investment holding
Virgin Islands US$400
Indirectly held
Dualiane Limited The British Ordinary 100% Investment holding
Virgin Islands US$1
Focus Clear Limited The British Ordinary 100% Investment holding
Virgin Islands US$1
Forepower Limited The British Ordinary 100% Property investment
Virgin Islands US$1 in Hong Kong
Fortune Focus Holdings The British Ordinary 100% Provision of corporate
Limited Virgin Islands US$10 advisory services
in Hong Kong
Fulltime Profits Limited The British Ordinary 55% Investment holding
Virgin Islands US$100
Genwo Limited Hong Kong Ordinary 100% Property holding
HK$2
Gold Chopsticks Limited The British Ordinary 100% Investment holding
Virgin Islands US$1

Annual Report 2000
49
Notes to the Financial Statements
for the Year Ended 31 December 2000
42.Particulars of Principal Subsidiaries (continued)
Nominal value
of issued Percentage
Place of ordinary share/ of equity
incorporation/ registered attributable to
Name of subsidiary registration capital the Company Principal activities
Indirectly held (Continued)
Golden Tropics Limited The British Ordinary 100% Investment holding
Virgin Islands US$1
Honest Opportunity The British Ordinary 100% Securities trading in
Limited Virgin Islands US$1 Hong Kong
Kintic Limited Hong Kong Ordinary 100% Property investment
HK$2
Konnic Limited Hong Kong Ordinary 100% Property holding
HK$2
Natural Flair Limited The British Ordinary 100% Investment holding
Virgin Islands US$1
Rich Investments Limited Hong Kong Ordinary 100% Property holding
HK$2
Shanghai Tricom Telecom Mainland Registered 51.32% Sale and distribution of
Equipment Co., Ltd. China US$4,500,000 telecommunication
equipment and
provision for
intelligent building
system integration
services
Sparkling Summer The British Ordinary 100% Securities trading in
Limited Virgin Islands US$6,500,000 Hong Kong
Star Telecom Holding Hong Kong Ordinary 100% Investment holding
Limited HK$200
Deferred #
HK$4,000,000
Star Telecom Limited Hong Kong Ordinary 100% Distribution of mobile
HK$3,000,000 phones


China Online (Bermuda)Limited
50
Notes to the Financial Statements
for the Year Ended 31 December 2000
42.Particulars of Principal Subsidiaries (continued)
Nominal value
of issued Percentage
Place of ordinary share/ of equity
incorporation/ registered attributable to
Name of subsidiary registration capital the Company Principal activities
Indirectly held (Continued)
Star Telecom Overseas Hong Kong Ordinary 100% Investment holding
Limited HK$200
Star Telecom PCN Limited Hong Kong Ordinary 100% Investment holding
HK$3,000,000
Star Telecom Properties Hong Kong Ordinary 100% Investment and
Limited HK$200 property holding
Superior Team Limited The British Ordinary 100% Investment holding
Virgin Islands US$1
Taskwell Limited The British Ordinary 100% Investment holding
Virgin Islands US$1
Tricom Shanghai Hong Kong Ordinary 55% Investment holding
Communications Limited HK$2
Tricom Tianchi Limited Hong Kong Ordinary 100% Investment holding
HK$2
Vinka Limited Hong Kong Ordinary 100% Investment holding
HK$2
Widerich Limited Hong Kong Ordinary 100% Property investment
HK$2
# The deferred shares, which are not held by the Group, practically carry no right to any dividend or to receive notice of or to attend or vote at any
general meeting of the company or to any distribution in winding up.

Annual Report 2000
51
Notes to the Financial Statements
for the Year Ended 31 December 2000
42.Particulars of Principal Subsidiaries (continued)
The above table lists the subsidiaries of the Company which, in the opinion of the directors, principally affected the
results of the year or formed a substantial portion of the net assets of the Group. To give details of other subsidiaries
would, in the opinion of the directors, result in particulars of excessive length.
All subsidiaries operate principally in their places of incorporation unless specified otherwise under “Principal
activities”.
None of the subsidiaries had any loan capital subsisting at 31 December 2000 or at any time during the year.
43.Particulars of Principal Assosciate
Particulars of the principal associate as at 31 December 2000 are as follows:
Place of Percentage of
Business incorporation/ interest attributable
Name structure registration to the Group Principal activities
Millennium Group Limited Corporate Hong Kong 21.7% Securities trading and
property holding
The above table lists the associate of the Group which, in the opinion of the directors, principally affected the results
of the year or formed a substantial portion of the net assets of the Group. To give details of other associates would,
in the opinion of the directors, result in particulars of excessive length.

China Online (Bermuda)Limited
52
The consolidated results and the assets and liabilities of the Group for the past five financial years, as extracted from
the Group’s published audited financial statements and reclassified as appropriate, are set out below:
Results
For the year ended 31 December
1996 1997 1998 1999 2000
HK$’000 HK$’000 HK$’000 HK$’000 HK$’000
Turnover
Continuing operations 499,942 586,551 215,169 462,100 2,442,429
Discontinued operations 43,756 99,382 719,748 148,723 —
543,698 685,933 934,917 610,823 2,442,429
Profit (loss) from operating activities:
Continuing operations (133,529) 145,280 (62,682) 256,113 1,334,661
Discontinued operations (15,747) (5,965) (300,309) 43,003 —
(149,276) 139,315 (362,991) 299,116 1,334,661
Share of profits less losses of:
Subsidiaries not consolidated (18,498) (197,910) (244,257) (11,845) —
Associates (914) (3,868) (3,320) (29,927) (884)
Profit (loss) before taxation (168,688) (62,463) (610,568) 257,344 1,333,777
Taxation (704) (3,219) 13,899 (2,579) 2,161
Profits (loss) before minority
interests (169,392) (65,682) (596,669) 254,765 1,335,938
Minority interests 381 43,516 31,944 5,616 (3,120)
Profit (loss) for the year (169,011) (22,166) (564,725) 260,381 1,332,818
Assets and Liabilities
At 31 December
1996 1997 1998 1999 2000
HK$’000 HK$’000 HK$’000 HK$’000 HK$’000
Total assets 1,009,987 1,459,299 922,977 4,384,096 2,522,502
Total liabilities (524,907) (550,997) (554,094) (165,118) (489,038)
Minority interests (22,678) (32,083) (31,946) (575) (3,695)
Shareholders’ funds 462,402 876,219 336,937 4,218,403 2,029,769
Financial Summary

[Boersi]

Ja und was sagt uns das. Hab beim Überfliegen nix neues gefunden. Was wird in Zukunft passieren? Wie werden sie den Gewinn reinvestieren? Wie wurde die HV von den Aktionären aufgenommen? Gibt es schon Presseberichte von der HV?


Wer weiss mehr?

[DonauPirat]

Der Geschäftsbericht 2000 war doch schon lange vor der HV erhältlich. Was es auf der HV neues gab hab ich aber noch nirgénds gefunden. Wenn jemand etwas weiss würde ich bitten kurz und bündig zu Berichten.
cu Dopi