Parkway Holdings Limited · PDF fileRS Siloam Gleneagles, Jakarta RS Graha Medika, ... Parkway...

The Parkway Group Healthcare Network 2

Parkway Group Healthcare 3

Gleneagles Clinical Research Centre 6

Board of Directors 8

Medi-Rad Associates Ltd 10

A Message From The Managing Director 12

Parkway Laboratory Services 18

An Update On Parkway Group Healthcare 20

Corporate Information 24

Financial Statements 25

Summary of Major Properties 90

Comparative Figures for Financial Years 92

Analysis of Shareholdings 94

Notice of Annual General Meeting 96

Proxy Form 99

Contents

Project Consultant : Asia Business Channels Pte Ltd • Design & Production : AC Graphic Workshop Pte Ltd

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2 The Parkway Group Healthcare Network

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PARKWAYGROUPHEALTHCARE

HOSPITALSDIVISION

HEALTHCARESERVICESDIVISION

INTERNATIONAL

OPERATIONS

SINGAPORE

OPERATIONS

East Shore Hospital

Gleneagles Hospital

MANAGED

CARE

LABORATORY

SERVICES

PRIMARY

HEALTHCARE

DIVISION

RADIOLOGY

SERVICES

DIAGNOSTIC

CENTRES

RENAL DIALYSIS

SERVICES

SUPPORTSERVICESDIVISION

Gleneagles

Technologies

Services

Thermal

International

Overseas

Singapore

Ko, Djeng

Gleneagles

Gleneagles

International

GP Group

United Kingdom

India

Indonesia

Malaysia

Gleneagles Medical Centre, Penang

Mount Elizabeth Hospital

Gleneagles Intan Medical Centre,Kuala Lumpur

RS Siloam Gleneagles, Jakarta

RS Graha Medika, Jakarta

RS Budi Mulia Gleneagles, Surabaya

RS Gleneagles, Medan

Duncan Gleneagles Hospital, Calcutta

The Heart Hospital, London

Shenton Medical Group

Gleneagles Maritime Medical Centre

The Radiologic Clinic:Six diagnostic centres

Eastern Specialist Centre

Surabaya, Indonesia

Xiamen, China

Nippon Medical Care

Shenton Family Medical Clinic

MEDICAL

EVACUATION

CLINICAL

RESEARCH

Onemedhub.com

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3Parkway Group Healthcare

Singapore

East Shore Hospital

• 157-bed generalacute care hospital

• Has built a loyalfollowing amongresidents ineastern Singapore

OperationalOwnership: 100%

Gleneagles Hospital

• 380-bed tertiaryacute care hospital

• Regional centre formedical referrals


Mount ElizabethHospital

• 505-bed acutecare hospital

• Establishedreputation in Asiafor expertise andquality care of itsspecialists andhealthcare staff


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RS Gleneagles,Medan


• Located at westernfringe of Medan’scentral businessdistrict

• Opened in August1997

OperationalOwnership: 25%Joint venture partners:Mertju Group, OngkoGroup

RS Budi MuliaGleneagles,Surabaya

• 148-bed generalcare hospital

• Located in thecentre ofIndonesia’s secondlargest city

Operational,expansion worksplannedOwnership: 100%interest held throughPT Siloam GleneaglesHealthcare Tbk

RS Graha Medika,Jakarta


OperationalOwnership: 54%interest held throughPT Siloam GleneaglesHealthcare Tbk

Indonesia

RS SiloamGleneagles, Jakarta


• Serves as a hub forParkway’sIndonesianhealthcare operations

• Started heart surgeryprogramme in mid1997

OperationalOwnership: 30%Joint venture partners:Lippo Group and publicshareholders

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Malaysia

Gleneagles MedicalCentre, Penang


• Located at JalanPangkor, Penang’sprime residentialdistrict

• Currently underexpansion toprovide additionalspace for doctorsoffices, patientbeds and otherclinical facilities

OperationalOwnership: 70%Joint venture partners:Doctors, Businessmen

Gleneagles IntanMedical Centre,Kuala Lumpur


• Located at JalanAmpang area,Kuala Lumpur’s“embassy row”

OperationalOwnership: 30%Joint venture partners:Tan & TanDevelopments Berhad,Insas Berhad, PNBEquity ResourceCorporation Sdn Bhd

United Kingdom

The Heart Hospital,London

• 95-bed specialistheart-care hospital

• Located at London’sMedical District

• Medical centre firstopened in July 1997

OperationalOwnership: 65%Joint venture partners:Doctors

India

Duncan GleneaglesHospital, Calcutta


• Diagnostic servicesstarted in October1997

Full completion: 2000Ownership: 50%Joint venture partners:Duncans IndustriesLtd

Gleneagles Clinical Research Centre

The Gleneagles Clinical Research Centre provides clinical research support to many doctors,

clinicians and scientists. The Centre makes full use of the existing infrastructure of hospitals,

laboratories, medical centres, telecommunication and state-of-the-art information technology

systems to oversee all aspects of a clinical trial in accordance with the Good Clinical Practice

guidelines. It is supported by an Independent Ethics Committee and a 15 member International

Scientific Board on ethical and scientific issues.

The Centre has the ability to offer comprehensive clinical trial management

and centralised clinical trial laboratory services that can be customised to

meet the needs of our clients.

Headquartered in Singapore, we operate within an environment that has both a well-developed

infrastructure and a legal system that recognises and protects intellectual property rights.

Gleneagles Clinical Research Centre is the first privately owned, one-stop

clinical research in Asia.

Drawing upon our knowledge and familiarity with the region, our extensive infrastructure and

resources, we are well positioned to support global multinational pharmaceutical companies

undertaking their clinical trials in this part of the world.

Our Resources

A network of hospitals and diagnostic laboratoriesacross Asia provides the integral infrastructure

needed for research.

Medical and clinical investigators are experiencedprofessionals with access to the latest knowledge

and information available.

State-of-the-art communication infrastructureenables us to keep in constant touch with the latest

developments around the world as they occur.

The heart of its operations is strategically locatedin Singapore, in itself a regional hub.

At all times there is strict conformance with theWHO Good Clinical Practice guidelines,

FDA and EU standards.

All research work is constantly reviewed andmonitored by an Independent Ethics Committee

Enhanced protocol designs are carefullyintegrated with clinical plans.

The healthcare expertise and infrastructure existsto manage the most unexpected emergencies.

The capability exists to manage a single study ormulti-centre clinical trials.

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8 Board of Directors

Anil ThadaniChairman

Tony Tan Choon KeatManaging Director

Ang Guan Seng Chang See Hiang

The Directors...

Gordon StavertByrn Sr.

Sunil Chandiramani

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Tan Kai Seng

Ho Kian Guan

Herman RonaldHochstadt

Fan Kow Hin

Dato Tan Chin NamHonorary Consultant

Goh Kee Song

Ed Ng Ee Peng

MMedi-Rad Associates Ltd (“Medi-Rad”) is the vision of a group of

radiologists to develop a state-of-the-art radiology centre in

Singapore. Established in 1982, Medi-Rad has grown into one of the

leading radiology centres in the region today. It serves the needs

of all healthcare sectors in Singapore and the region through the

provision of a wide range of radiology services.

Magnetic Resonance

Imaging or MRI utilises

magnetic fields to

produce high-resolution

images of body tissues.

Computed Tomography

or CT Scan utilises

X-Ray radiation and

sophisticated computer

technology to image

internal organs and

vascular structures

with a high degree of

resolution and in

extremely short times.

IThe Medi-Rad NetworkOur first all comprehensive Radiologic Clinic was sited in the Promenade,and initially catered to the needs of the private sector in Singapore.

In 1990, Medi-Rad extended its coverage further by launchingservices at a polyclinic and a satellite clinic. Following this, Medi-Radincreased further its network by adding four more outlets wherevarious different services are offered.

It also began to meet the needs of General Practice Groups and MedicalCentres by providing Radiology Services as a Service Provider.In addition, Medi-Rad now has the ability to meet the needs of patientsand medical specialists from the region.

With its main facility at Mount ElizabethMedical Centre, Medi-Rad has a network of

Radiologic Clinics spanning different parts ofSingapore supporting medical professionals in

their radiology and diagnostic needs.

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1999 will be a year most remembered in the history of

Parkway Holdings Limited (“Parkway” or “the Group”) for the

milestones we achieved. We not only survived the Asian economic

crisis; we secured and reinforced our position as one of the leaders

in the region’s private healthcare industry. During the year, the

Group underwent a major restructuring and business

rationalization exercise and emerged with a strong balance sheet,

a focused business in the healthcare industry and improved

business performance.

Following more than two decades of operations at Parkway

Properties Pte Ltd., early this year we entered into an agreement

to sell Parkway Parade, our flagship building. Upon the

completion of this sale, expected towards the middle of year

2000, we will draw a close to the chapter of the Group’s business

in the property market. The funds realised from the sale will be

used to retire our borrowings and reduce the Group’s debt level

to about $100 million, a relatively low gearing level compared

to the size of the Group today. In 1998, the Group’s borrowings

totalled about $1.2 billion. Since then, the series of deft and

strategic moves by the Group underscore its determination to

focus its resources into its healthcare business as it moves into

the 21st century.

A Message From The Managing DirectorPark

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Tony C.K. TanManaging Director

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In 1999, reflecting the recovery across many Asian

economies, our operations in the region too turned in stronger

contributions. During the year, the stronger performance by the

Group’s Asian operations was partially offset by the operating

losses, totalling approximately $21.9 million, incurred by its

Heart Hospital in London. Notwithstanding these losses, the

Group turned in a pre-tax operating profit of about $48.7 million

representing an increase of 31% compared to the $37.1 million

achieved in the previous year.

In Asia, the Group saw a pick up across its regional businesses

as well as higher arrivals of foreign patients into Singapore seeking

medical attention. This trend is expected to continue as the

economic conditions in Asian countries improve. In 1999, the

Indonesian and the Malaysian hospitals have turned in good

performances with our hospitals in both countries reporting

stronger cash flow positions.

At the Group level, our cash flow continues to improve as a

result of the interest savings from lower bank borrowings and

the stronger business performance of the entire Group.

1995 1996 1997 1998 19990

10

20

30

40

50

60

70

Profit Before Taxation($million)

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Amongst the more significant business developments in

the Group during the 1999 financial year are the establishment

of Gleneagles Clinical Research Centre, a one-stop hub for

clinical trials and the establishment of Gleneagles Global

Medical Care, a medical care and evacuation service. This year,

Onemedhub.com, the Group’s B2B e-commerce portal for

healthcare was established. Two of the Group’s subsidiaries,

Medi-Rad Associates Ltd., the radiology and imaging unit, and

Parkway Laboratory Services Ltd., are now listed on the

Singapore Exchange Dealing and Automated Quotation Systems

(“SGX-SESDAQ”).

On 14 March 2000, Medi-Rad Associates Ltd launched its

initial public offering (“IPO”) during which a total of 32 million

new shares were offered comprising 13.75 million offer shares

and 18.25 million placement shares. The shares were well received

by the public and upon the closing of the offering, the subscription

received from public tranche was about 27.4 times the total

number of share offered. The placement tranche was fully

subscribed at the beginning of the IPO launch.

1995 1996 1997 1998 19990

200

400

600

800

1000

1200

Total Debt (Gross)($million)

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Following closely on the heels of the listing of Medi-Rad

Associates Ltd., Parkway Laboratory Services Ltd launched its

initial public offering on 7 April 2000. During the IPO, a total

of 38 million shares were offered comprising14.25 million offer

shares and 23.75 million placement shares. Upon the closing of

the public offer, the subscription received from the public tranche

was about 5.2 times the total number of shares offered. The

placement tranche was fully subscribed at the beginning of the

initial public offer.

1999 marks the first full year of operation at the Heart

Hospital in London. The London Heart Hospital is a newly

established operation and over the last 12 months the hospital

has rapidly gained a firm foothold in the healthcare scene in

London. Today it is particularly noted as one of the leaders in

the field of pediatric cardiology services. Furthermore, the

growth in the hospital’s occupancy rate is very encouraging

and we expect to see higher occupancy rates, as patients become

more aware of the quality of healthcare services that the hospital

and its medical team are capable of delivering.

1995 1996 1997 1998 19990

50

100

150

200

250

300

350

400

Turnover($million)

The implementation of its new corporate strategies has

turned the Parkway Group into a formidable business force in

the healthcare industry in the region. With the consolidation

and strategic streamlining of its resources, the Group now has

the financial and management capabilities to explore many new

business avenues. The alternatives include the possibility of a

capital redemption and investments in new businesses. To ensure

that the Group continues to maintain our leadership position in

the healthcare industry across Asia, we will always be on the

look out for opportunities to invest in new business investments

and structure strategic alliances with synergistic partners in the

market. More importantly, the management of Parkway

Holdings Limited is committed to continue to deliver value and

make the Group an attractive and rewarding investment for all

our shareholders.

Looking forward, as the Asian economies continue their

recovery the Board of Directors and the management of Parkway

Holdings Limited are optimistic about the performance of the

Group in year 2000. The demand for hospital and medical services

during the first quarter of the year continues to improve as we

see patients returning from our traditional markets like Indonesia

and Malaysia. Even more encouraging are the patients from newer

markets like India where marketing efforts only commenced last

year.

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1995 1996 1997 1998 19990.00

0.02

0.04

0.06

0.08

0.10

0.12

0.14

0.16

Earnings Per Share($)

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Finally on behalf of the board and management of Parkway

Holdings Limited, we would like to thank all our employees

and our shareholders for their support over the past year. We

would also like to take this opportunity to thank Mr Ang Poon

Tiak for his contributions to the Group as he retires from his

position as the director of the Group at the end of the 1999

financial year. At the same time, we welcome Mr Anil Thadani,

Mr Gordon Stavert Byrn Sr. and Mr Sunil Chandiramani who

joined the board on 17 December 1999 and a special welcome

to Mr Anil Thadani as he assumed the position of the Chairman

of the Board on 17 January 2000.

The Board of Directors has proposed a final dividend of 8%

subject to the approval of the shareholders at the forthcoming

Annual General Meeting.

Tony C.K. Tan

Managing Director

Parkway Laboratory Services (“PLS” or “the Company”) is

one of the largest privately owned laboratory service

providers in Singapore. It is a clinical laboratory licensed

by the Singapore Ministry of Health under the Private

Hospitals & Medical Clinics (Amendment) Act 1999 and

Regulations and audited by the Medical Audit & Accreditation

Unit (MAAU). In 1994, operating under the name of

Mount Elizabeth Healthcare Services Pte Ltd, it was the

first medical laboratory in the Asia Pacific to achieve

BVQI ISO 9002 Quality Certification.

Today, PLS has a network of laboratories located onthe premises of East Shore Hospital, Gleneagles Hospital

and Mount Elizabeth Hospital, the three privatehospitals owned by the Parkway Group as well as areference laboratory in Henderson Industrial Park

which also serves as its headquarters.

The Company first expanded in 1991

into a comprehensive diagnostic

laboratory serving the needs of the

inpatients and outpatients of Mount

Elizabeth Hospital and East Shore

Hospital as well as patients referred

to it by the specialists operating both

within and outside of the medical

centres annexed to the hospitals.

In 1995, the Company was acquired

by Parkway Holdings Limited

(“Parkway Group”).

The PLS Background

• Pathology

The Pathology Department is divided into the Histopathology

Section and Cytology Section.

The services include:

(a) routine diagnostic Histopathology for all surgical

and biopsy specimens

(b) providing frozen tissue sections for intra-operative diagnosis

(c) diagnostic cytology, which covers all standard

applications, including cervical PAP smears,

fluids and aspirates, and Fine Needle Aspiration

Cytology (FNAC)

(d) post-mortem examinations

(e) screening for Down’s Syndrome

• Genetics

This is divided into the Cytogenetics and Molecular

Genetics Sections.

(a) Prenatal diagnosis: Amniotic fluid, chorionic villi, foetal

cord blood

(b) Prenatal aneuploidy screening: Molecular fluorescent

interphase analysis

(c) Other analysis

The services provided by PLS are:

• Clinical Laboratory Services

(a) Chemistry

(b) Haematology

(c) Immunohaematology

(d) Microbiology

(e) Immunology and Serology

The Parkway LaboratoryServices

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20 An Update On Parkway Group Healthcare

Our Singapore healthcare operations recovered strongly with

the improving economic conditions in Asia in 1999. The increasing

number of foreign patients and the successful implementation of

cost containment measures by the Group are reflected in the

improved pre-tax operating profit contributions from healthcare.

The changing face of the healthcare scene is also evident in

the continuing shift of the types of cases toward more complex

procedures handled by the Group’s Singapore hospitals. This is

in line with the recovery in foreign patient numbers and boosted

mean revenues per admission by about 3% compared to 1998.

In 1999, the number of day cases surged by about 13.3%

while the increase in the number of admissions and average length

of stay rose minimally by about 0.4% and 0.8% respectively. These

statistics correspond to our expectations that the number of

patient-days in hospitals will decline, as minimally invasive

surgery becomes more popular and the quality of healthcare

services improves.

Over the last few years, Parkway Group Healthcare Pte Ltd

(“PGH”) saw significant growth and development throughout

the organization. We now have a network of 12 hospitals and

diagnostic laboratories and medical centers in selected Asian

countries as well as a hospital in London, the Heart Hospital,

which commenced operations in 1999. Riding on our strong

infrastructure, PGH is now poised to grow further and add value

to our range of healthcare services.

The role of healthcare will grow increasingly important as

the population in Singapore ages. In the 21st century Singapore

Dr Lim Cheok PengManaging DirectorParkway Group Healthcare Pte Ltd

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will experience a greying population who may require other

healthcare services. To meet these new demands, the healthcare sector

will need to provide for a different set of needs. Instead of bringing

the elderly sick to our hospitals, the challenge for the industry will

be to develop a way of bringing the hospitals to their doorsteps,

nursing and monitoring them in the comfort of their homes.

In time to come, doctors will be able to monitor electro-

cardiograms, blood pressure, blood sugar, respiratory functions,

glaucoma and a wide range of other healthcare needs this way. When

such monitoring devices are available, we should be able to provide

intensive care within the confines of the home, which can be monitored

from the hospital’s alarm centre. Patients may be discharged

right after surgery, and be administered blood transfusion,

chemotheraphy and antibiotics at home. This is a new concept in

the treatment and management of the chronically ill patients.

As time passes, the healthcare scene will inevitably become

more competitive. New hospitals and medical centres will be

developed. The government in Singapore has recently announced

that it will integrate public healthcare by grouping its polyclinics,

hospitals and medical centres into two main clusters. Polyclinics

will thereafter be able to refer patients right back to the medical

centres and motherhouse hospitals. This will ensure efficiency

and protect the public healthcare sector so that it does not lose

its patients. On the other hand, this move will also further raise

the barriers to entry. Land costs, manpower costs and high-tech

equipment costs are all high. New entrants must have deep

pockets. Independent healthcare operations cannot just open a

hospital and expect to survive anymore. Without efficiency, a

ready supply of patients and economies of scale, it will be difficult

East Shore Hospital

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to compete in a market like Singapore where the population is

small relative to other countries in the region.

The infrastructure that PGH has built over the last few years

has grown into a formidable force today. The B2B e-commerce

platform that we are currently developing, Onemedhub.com, will

inter-link our infrastructure combining the supply chain

management with strong fulfillment and logistics capabilities.

This will help increase our efficiency and sharpen our competitive

edge in the market adding value to our patients and their medical

doctors and specialists, translating eventually to improved

shareholders’ value to the organization.

In the second half of 1999, we set up the Gleneagles Clinical

Research Centre, a hub for clinical research and drug development

in Asia. This corresponds to the vision of the Singapore government

to turn Singapore into a medical hub and also enables doctors in

the private practice to keep up with the advances in the medical

environment and an opportunity to upgrade their skills.

To date there has never been an Asian centre for clinical trials

and new drugs were always launched here six months later than

other regional markets because trials had to be done elsewhere.

The Gleneagles Clinical Research Centre is an independent entity

dedicated to conduct trials with proper ethics and scientific

committees to oversee the trials in Asia.

Clinical research is big business today. In Singapore, the

market is worth about $120 million. Having a centre to attract

pharmaceutical research here will put us in a different league

altogether as a medical hub.

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Gleneagles Hospital

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Other developments in the Group during the year also include

the initial public listing of our radiology and imaging arm, Medi-

Rad Associates Ltd and laboratory services, Parkway Laboratory

Services Ltd. These two units set the precedents for all other units

within the Group that have the capabilities to grow into independent

business entities. Riding on PGH as a nucleus through which to

nurture and develop new healthcare specialties, we are able to offer

opportunities to grow new healthcare services to better serve the

needs of our patients and their doctors into the new century.

With the recent restructuring of Parkway Holdings Ltd and

the decision to focus on healthcare as the Group’s core business,

we now have the resources to grow and develop our capabilities

and network in Asia and across the world. Today, our vision of

Parkway Group Healthcare extends beyond a physical network

of bricks and mortar. Horizontally we will grow and expand our

healthcare reach to more countries in Asia like China and India

where there is a major demand for basic healthcare facilities.

Vertically we will continue to bring in different healthcare

specialities and disciplines especially in the areas of life sciences

and biotechnology. In addition, with the incorporation of the

capabilities of web-enabled information technology and

communication, we aim to grow the Parkway Group as an

unsurpassed leading healthcare provider in Asia.

Dr Lim Cheok Peng

Managing Director

Parkway Group Healthcare Pte Ltd

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Mount Elizabeth Hospital

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Directors

Anil Thadani Chairman

Tony Tan Choon Keat Managing Director

Ang Guan Seng*

Gordon Stavert Byrn Sr.

Sunil Chandiramani

Chang See Hiang

Fan Kow Hin

Goh Kee Song*

Ho Kian Guan

Ho Kian Hock Alternate to Ho Kian GuanHerman Ronald Hochstadt*

Ed Ng Ee Peng

(Appointed on 28 April 2000)

Tan Kai Seng

* members of the Audit Committee

Honorary Consultant

Dato Tan Chin Nam

Secretary

June Tay Kwok Fung

Registered Office

80 Marine Parade Road

#22-01/09

Parkway Parade

Singapore 449269

Telephone: 345 8822

Corporate Information

Share Registrar

M & C Services Private Limited

16 Raffles Quay #23-01

Hong Leong Building

Singapore 048581

Telephone: 227 6660

Auditors

KPMG

Certified Public Accountants

Singapore

Partner-in-charge: Chay Fook Yuen

Principal Bankers

The Development Bank of Singapore

ABN AMRO Bank N.V.

Banque Nationale de Paris, Singapore Branch

Crédit Agricole Indosuez

The Hongkong and Shanghai Banking Corporation Limited

Oversea-Chinese Banking Corporation Limited

Overseas Union Bank Limited

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Directors’ Report 26

Statement by Directors 37

Auditors’ Report to the Members of Parkway Holdings Limited 38

Consolidated Balance Sheet 39

Consolidated Profit and Loss Account 40

Consolidated Statement of Cash Flows 41

Balance Sheet 44

Profit and Loss Account 45

Notes to the Financial Statements 46

Financial Statements

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We, the undersigned directors, on behalf of all the directors of the Company, take pleasure inpresenting this report together with the audited financial statements of the Group and of theCompany for the financial year ended 31 December 1999.

Directorate

The directors in office at the date of this report are:

Anil Thadani (appointed on 17 December 1999)Dr Han Cheng Fong (Deputy Chairman)Tony Tan Choon Keat (Managing Director)Ang Guan SengGordon Stavert Byrn Sr. (appointed on 17 December 1999)Sunil Chandiramani (appointed on 17 December 1999)Chang See HiangFan Kow HinGoh Kee SongHo Kian GuanHo Kian Hock (alternate to Ho Kian Guan)Herman Ronald HochstadtTan Kai Seng

Principal Activities

The principal activities of the Company during the financial year are those relating to investmentholding while those of the subsidiaries consist of the business of:

(a) private hospital ownership and management and related healthcare services,

(b) ownership and management of medical clinics,

(c) dealing in medical supplies, equipment and healthcare products,

(d) practice of dental surgeons and the operation of dental clinics,

(e) provision of a clinical research centre,

(f) providing industrial, clinical and medical laboratory testing and consultancy services,

(g) property investment and development,

(h) investment holding and trading, and

(i) advertising and building management agency.

There have been no significant changes in the activities during the financial year.

Directors’ Reportf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

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Acquisitions and Disposals of Subsidiaries

The following subsidiaries were incorporated during the financial year:

Name of Subsidiary Paid-up Capital

Parkway Group Healthcare Pte LtdGleneagles Medical Global Care Pte Ltd $2

Mount Elizabeth Healthcare Services Sdn BhdOrifolio Options Sdn Bhd RM2

Gleneagles Hospital LimitedGleneagles CRC Pte Ltd $2

During the financial year:

(a) the Company acquired the remaining 16% equity interest in a subsidiary, Westront Pte Ltd fora nominal consideration of $1. The net liabilities acquired were $1,446,787.

(b) Gleneagles International GP Pte Ltd, a wholly-owned subsidiary, acquired 100% equity interestin a related corporation, Shenton Family Medical Clinics Pte Ltd (formerly known as SOSMedical Emergencies Pte Ltd) for a cash consideration of $2 from its wholly-owned subsidiary,Shenton Medical Holdings Pte Ltd.

The following subsidiary was disposed of during the financial year:

NetLiabilities Percentage

Name of Subsidiary Consideration Disposed Disposed$ $ %

Parkway Managed Care Pte Ltd 2,304,500 (1,006,736) 50

Parkway (PNG) Limited, a wholly owned subsidiary of Weian Investments Pte Ltd, was de-registered.

Other than the above, there were no acquisitions or disposals of subsidiaries during the financial year.


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Financial Results

Results of the Group and of the Company for the financial year are:

The Group The Company$’000 $’000

Profit after taxation but before minority interestsand extraordinary items 35,341 22,386

Minority interests 3,500 –Extraordinary items 84,992 (3,200)

Profit after taxation, minority interests and extraordinary items 123,833 19,186

Appropriations:Interim dividend of 5% less 26% tax (6,653) (6,653)Proposed final dividend of 8% less 25.5% tax (10,699) (10,699)

(17,352) (17,352)

Retained profit transferred to Revenue Reserves 106,481 1,834

Transfers to and from Reserves and Provisions

There were the following movements in reserves during the financial year:

The Group The Company$’000 $’000

Increase/(Decrease) in:Share premium 1,834 1,834Revaluation reserves (139,934) –Exchange fluctuation reserves 25,875 3,200Revenue reserves 106,144 1,834

Movements in provisions are set out in the accompanying notes to the financial statements.

Issues of Shares and Debentures

During the financial year, the Company issued 615,000 ordinary shares of $0.50 each for cash,following the exercise of options under the Parkway Employee Share Option Scheme (“ParkwayScheme”) at the following exercise prices:

Number of Shares Exercise Price Per Share

100,000 $3.538100,000 $3.394415,000 $3.490

615,000


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Issues of Shares and Debentures (cont’d)


(a) a subsidiary, Shenton Family Medical Clinics Pte Ltd (formerly known as SOS MedicalEmergencies Pte Ltd) increased its authorised share capital from $25,000 divided into 25,000ordinary shares of $1 each to $1,000,000 divided into 1,000,000 ordinary shares of $1 eachby the creation of 975,000 ordinary shares of $1 each.

(b) a subsidiary, Nippon Medical Care Pte Ltd, issued an additional 499,997 ordinary shares of $1each credited as fully paid by way of capitalisation of loans from its shareholders.

(c) a subsidiary, Pulau Pinang Clinic Sdn. Bhd. increased its authorised share capital fromRM20,000,000 to RM50,000,000 divided into 50,000,000 ordinary shares of RM1 each bythe creation of 30,000,000 ordinary shares of RM1 each.

The subsidiary issued an additional 6,459,331 ordinary shares of RM1 each at par for cash byway of a rights issue on the basis of one new ordinary share for every one existing ordinaryshare to provide financing for the extension of the hospital building.

(d) a subsidiary, Gleneagles Medical Global Care Pte Ltd, was incorporated with an authorisedshare capital of $100,000 by the creation of 100,000 ordinary shares of $1 each. 2 subscribers’shares of $1 each fully paid were issued at par for cash.

(e) a subsidiary, Gleneagles CRC Pte Ltd, was incorporated with an authorised share capital of$100,000 by the creation of 100,000 ordinary shares of $1 each. 2 subscribers’ shares of $1each fully paid were issued at par for cash.

(f) a subsidiary, Orifolio Options Sdn Bhd, was incorporated with an authorised share capital ofRM100,000 by the creation of 100,000 ordinary shares of RM1 each. 2 subscribers’ shares ofRM1 each fully paid were issued at par for cash.

(g) a subsidiary, Parkway Group Healthcare Pte Ltd (“PGH”) issued 71,400,000 non-cumulativeredeemable preference shares of $0.01 each at a premium of $0.99 per share to the Companyas consideration for the capitalisation of the inter-company balance owing to the Company.

Except as disclosed above, neither the Company nor its subsidiaries issue any shares and debenturesduring the financial year.

Arrangements to Enable Directors to Acquire Shares or Debentures

Neither at the end of nor at any time during the financial year was the Company a party to anyarrangement whose objects are, or one of whose objects is, to enable the directors of the Companyto acquire benefits by means of the acquisitions of shares or debentures of the Company or anyother body corporate, except as disclosed under “Share Options” below.

Directors’ Interests in Shares, Warrants and Options

Except as disclosed in this report, no director who held office at the end of the financial year hadinterests in shares or debentures of the Company or of related corporations either at the beginningof the year or date of appointment, if later, or at the end of the financial year.


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30

Directors’ Interests in Shares, Warrants and Options (cont’d)

According to the register kept by the Company for the purposes of Section 164 of the Companies Act,Chapter 50, particulars of beneficial interests of directors who held office at the end of the financialyear in shares, warrants and share options in the Company and related corporations, are as follows:

Holding in which thedirector is deemed to

Held by the director have an interest

At beginning At end At beginning At endof the year of the year of the year of the year

The Company Ordinary Shares of $0.50 each

Goh Kee Song 35,000 35,000 200,000 200,000Tony Tan Choon Keat 7,108,388 7,108,388 1,105,000 1,105,000Tan Kai Seng 225,000 300,000 – –

Options to subscribe for Ordinary Shares of $0.50 each

(exercise price at $3.394 per share and exercisable between17/4/1996 and 16/2/2000)

Tan Kai Seng 100,000 – – –



Tan Kai Seng 100,000 100,000 – –



Tan Kai Seng 100,000 100,000 – –



Tan Kai Seng 100,000 100,000 – –

Related Corporation

Pulau Pinang Clinic Sdn Bhd Shares of RM1.00 each

Tony Tan Choon Keat – – 18,660 262,901

The directors’ interests in shares and share options in the Company and related corporations as at21 January 2000 (being 21 days after the end of the financial year) remained unchanged.

For the purposes of determining directors’ deemed interest in shares or debentures at the beginningand at the end of the financial year, the directors have applied the provisions of Section 7 of theCompanies Act, Chapter 50, as amended by the Companies (Amendment) Act 1998. As such, thedirectors whose deemed interest in shares or debentures as stated in the Directors’ Report for theyear ended 31 December 1997, no longer have such deemed interest following the amendment tothe Companies Act.


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31

Dividends

Since the end of the last financial year, a net dividend of $7,962,000 was paid in respect of theprevious year as proposed in the Directors’ Report of that year. A net interim dividend of $6,653,000has been paid during the year and the directors now recommend the payment of a net final dividendof $10,699,000 for the financial year under review.

Other Statutory Information

(a) Bad and Doubtful Debts

Before the profit and loss account and the balance sheet of the Company were made out, thedirectors took reasonable steps to ascertain what action had been taken in relation to writingoff bad debts and providing for doubtful debts of the Company. The directors have satisfiedthemselves that all known bad debts have been written off and that adequate provision hasbeen made for doubtful debts.

At the date of this report, the directors are not aware of any circumstances which wouldrender any amounts written off for bad debts or provided for doubtful debts in the Groupinadequate to any substantial extent.

(b) Current Assets

Before the profit and loss account and the balance sheet of the Company were made out, thedirectors took reasonable steps to ascertain that current assets of the Company which wereunlikely to realise their book values in the ordinary course of business have been writtendown to their estimated realisable values and that adequate provision has been made for thediminution in value of such current assets.

At the date of this report, the directors are not aware of any circumstances not otherwisedealt with in this report which would render the values attributable to current assets in theconsolidated financial statements misleading.

(c) Charges and Contingent Liabilities

Since the end of the financial year:

• no charge on the assets of the Company or any corporation in the Group has arisenwhich secures the liabilities of any other person; and

• no contingent liability of the Company or any corporation in the Group has arisen.

(d) Ability to Meet Obligations

No contingent liability or other liability of the Company or any corporation in the Group hasbecome enforceable or is likely to become enforceable within the period of twelve monthsafter the end of the financial year which, in the opinion of the directors, will or maysubstantially affect the ability of the Group or of the Company to meet their obligations asand when they fall due.


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Other Statutory Information (cont’d)

(e) Other Circumstances Affecting Financial Statements

At the date of this report, the directors are not aware of any circumstances not otherwisedealt with in this report or the financial statements which would render any amount statedin the consolidated financial statements or the financial statements of the Company misleading.

(f) Unusual Items

In the opinion of the directors, no item, transaction or event of a material and unusual nature hassubstantially affected the results of the operations of the Group or of the Company during thefinancial year except as disclosed as exceptional and extraordinary items in the financial statements.

In the opinion of the directors, no item, transaction or event of a material and unusual naturehas arisen in the interval between the end of the financial year and the date of this reportwhich is likely to affect substantially the results of the operations of the Group or of theCompany for the financial year in which this report is made.

Directors’ Interests in Contracts

Since the end of the last financial year, no director has received or become entitled to receive abenefit by reason of a contract made by the Company or a related corporation with the director orwith a firm of which he is a member or with a company in which he has a substantial financialinterest. During the year, certain transactions were made between the Company and a firm inwhich one of the directors is deemed to have a substantial interest in the ordinary course of business.However, the director has neither received nor will he become entitled to receive any benefit fromthese transactions.

Share Options

(a) Parkway Employee Share Option Scheme (“Parkway Scheme”)

Details of the Parkway Scheme were set out in the Directors’ Report for the year ended31 December 1988, and amendments were effected by a resolution passed at the ExtraordinaryGeneral Meeting of the Company held on 22 August 1994 and which were set out in theDirectors’ Report for the year ended 31 December 1994.

(b) Share Options Granted During The Year

No new share options were granted to employees under the Parkway Scheme in respect of thefinancial year under review. None of the share options offered in previous financial years wasgranted at a discount.


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33

Share Options (cont’d)

(c) Share Options Exercised

During the financial year, the Company issued 615,000 ordinary shares of $0.50 each forcash, following the exercise of options under the Parkway Scheme at the following exerciseprices:

Number of Shares Exercise Price Per Share

100,000 $3.538100,000 $3.394415,000 $3.490

615,000

(d) Unissued Shares Under Option

At the end of the financial year, unissued shares of the Company under option are as follows:

(i) 20,000 ordinary shares of $0.50 each at $3.394 per share exercisable between 17 April1996 and 16 February 2000 by grantees under the Parkway Scheme.

(ii) 240,000 ordinary shares of $0.50 each at $3.682 per share exercisable between 21 March1997 and 20 January 2001 by grantees under the Parkway Scheme.

(iii) 1,483,000 ordinary shares of $0.50 each at $5.690 per share exercisable between 3 April1998 and 2 February 2002 by grantees under the Parkway Scheme.

(iv) 1,060,000 ordinary shares of $0.50 each at $3.490 per share exercisable between 20April 1999 and 19 February 2003 by grantees under the Parkway Scheme.

Subsequent to balance sheet date, share options for 20,000 ordinary shares of $0.50 each at$3.394 per share and 338,000 ordinary shares of $0.50 each at $3.49 per share were exercisedunder the Parkway Scheme.

The options granted by the Company do not entitle the holders of the options, by virtue of suchholdings, to any right to participate in any share issue of any other company.


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34

Year 2000 Statement

Year 2000 (“Y2K”) Compliance Definition

Year 2000 compliance means that any computer chip dependent equipment or software will be ableto process any date and time data values correctly between the twentieth and twenty-first centuries.

Impact On Business, Cost and Revenues

The Group has had a smooth transition into the Year 2000 and has not encountered major disruptionsto its operations.

As a healthcare service provider, the Group is especially concerned about patient safety and theaccuracy of clinical data. The Group will continue its efforts in monitoring compliance with Y2Kand ensure any possible disruptions to its operations are expeditiously resolved.

The Group has incurred approximately $1.4 million in replacing the embedded system to ensureY2K readiness, which was expensed off in the financial year under review.

Corporate Governance

The Company fully supports and observes the Best Practices Guide on Corporate Governancerecommended by the Stock Exchange Securities Trading Limited. The Board of Directors has adopteda Corporate Governance Policy comprising the various self-regulatory and monitoring mechanismsas follows:

The Board of Directors and its Committees

The Board consists of thirteen members. The Managing Director, Mr Tony Tan Choon Keat andthe Finance Director, Mr Tan Kai Seng are the only two executive directors on the Board. Allthe other members are non-executive directors who have a diversity of experience and expertise.The responsibilities of the Board include approval of the Group’s strategic plans, significantinvestment/divestment and funding decisions, review of the Group’s financial performance andoperational initiatives, and approval of compensation of senior management personnel. Thesefunctions are carried out by the Board or through Board Committees such as the ManagementCommittee, the Executive Committee and the Directors’ Remuneration sub-committee.

In addition, the Audit Committee is chaired by Mr Goh Kee Song and assisted by two othernon-executive members. The Audit Committee members are non-executive members of the Board.The present Audit Committee will continue to play an important role in assisting the Board in ensuringthat the financial reporting and internal accounting controls of the Group meet the highest standards.

The responsibility for administrating the Parkway Scheme is vested with the Directors’ RemunerationSub-Committee in its absolute discretion with such powers and duties as are conferred on it by theBoard of Directors.

In discharging this responsibility, the Directors’ Remuneration Sub-Committee would take intoaccount certain criteria as established in the Parkway Scheme for evaluating the eligibility ofemployees to participate under the scheme. In addition, the Directors’ Remuneration Sub-Committeeis authorized, from time to time, to make and vary the terms and conditions governing the ParkwayScheme as and when it considers appropriate and in accordance with the established guidelines.


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35Directors’ Reportf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

Corporate Governance (cont’d)

Internal Code on Dealings with Securities

An internal code on dealing in securities has been issued to directors and officers setting outthe implications on insider trading. The code was modelled after the Best Practices Guide withsome modifications.

1. Directors and officers are prohibited from trading in the Company’s securities for the periodone month before the announcement of the Company’s half-yearly and annual results andending on the date of the announcement of the results, and any other period specified by theBoard or the Company Secretary.

2. Directors and officers are also not expected to deal in the Company’s securities on considerationsof a short term nature.

3. Notwithstanding this, all employees and directors are required to observe the insider tradinglaws under the Securities Industries Act at all times even when engaging in dealings in securitieswithin the permitted periods. To enable the Company to monitor such transactions, directorsand officers of the Company are required to report to the Company Secretary whenever theydeal in the Company’s securities.

4. Subject to the strict observance of the Securities Industries Act, clearance may be given by theBoard of Directors, in the following exceptional circumstances:

(i) for an officer to sell (but not to purchase) the Company’s securities during the prohibitedperiods due to a forced sale by a mortgagee or other extenuating reasons; and

(ii) for the exercise of an option or right under the Parkway Scheme, or the conversion ofconvertible securities, where the final date for the exercise of such option or right, orconversion of such securities, falls during the prohibited periods, and the officer couldnot be reasonably expected to exercise it at an earlier time during the permitted periods.Where an exercise or conversion is permitted pursuant to this paragraph, the Board maynot, however, give clearance during the same prohibited period for the sale of theCompany’s securities pursuant to the exercise or conversion.

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36 Directors’ Reportf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

Audit Committee

The Audit Committee members at the date of this report are:

Goh Kee Song (Chairman)Ang Guan SengHerman Ronald Hochstadt

The Audit Committee is appointed by the Board of Directors which has overall responsibility forthe financial reporting and internal accounting controls of the Group and the Company. The AuditCommittee met during the year to:

• review the scope of internal and external audits• review the adequacy of internal control systems of the Group• review the external auditors’ management letter and the responses of management• review interested party transactions• review financial reporting and other related matters

The Audit Committee also reviewed the assistance given by the Company’s officers to the auditors.The consolidated financial statements and the financial statements of the Company were reviewedby the Audit Committee prior to their submission to the directors of the Company for adoption.

The Audit Committee has recommended to the Board of Directors that the auditors, KPMG, benominated for re-appointment as auditors at the forthcoming Annual General Meeting of the Company.

Auditors

The auditors, KPMG, have indicated their willingness to accept re-appointment.

On behalf of the Board of Directors

TONY TAN CHOON KEATDirector

TAN KAI SENGDirector

Singapore27 March 2000

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37Statement by Directorsf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

We, TONY TAN CHOON KEAT and, TAN KAI SENG being directors of PARKWAY HOLDINGSLIMITED, do hereby state that in our opinion:

(a) the financial statements set out on pages 39 to 89 are drawn up so as to give a true and fairview of the state of affairs of the Group and of the Company as at 31 December 1999, and ofthe results of the business of the Group and of the Company, and cash flows of the Group forthe year ended on that date; and

(b) at the date of this statement there are reasonable grounds to believe that the Company will beable to pay its debts as and when they fall due.

On behalf of the Board of Directors

TONY TAN CHOON KEATDirector

TAN KAI SENGDirector


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38 Report of the Auditorst o t h e M e m b e r s o f P a r k w a y H o l d i n g s L i m i t e d

We have audited the financial statements of Parkway Holdings Limited and consolidated financialstatements of the Group for the year ended 31 December 1999 as set out on pages 39 to 89. Thesefinancial statements are the responsibility of the Company’s directors. Our responsibility is toexpress an opinion on these financial statements based on our audit.

We conducted our audit in accordance with Singapore Standards on Auditing. Those Standardsrequire that we plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free of material misstatement. An audit includes examining, on a testbasis, evidence supporting the amounts and disclosures in the financial statements. An audit alsoincludes assessing the accounting principles used and significant estimates made by the directors,as well as evaluating the overall financial statement presentation. We believe that our audit providesa reasonable basis for our opinion.

In our opinion:

(a) the financial statements and consolidated financial statements are properly drawn up inaccordance with the provisions of the Companies Act, Chapter 50 (the “Act”) and SingaporeStatements of Accounting Standard and so as to give a true and fair view of:

(i) the state of affairs of the Company and of the Group as at 31 December 1999 and of theresults of the Company and of the Group and of the cash flows of the Group for the yearended on that date; and

(ii) the other matters required by Section 201 of the Act to be dealt with in the financialstatements and consolidated financial statements;

(b) the accounting and other records and the registers required by the Act to be kept by theCompany and by those subsidiaries incorporated in Singapore of which we are the auditorshave been properly kept in accordance with the provisions of the Act.

We have considered the financial statements and auditors’ reports of the subsidiaries of which wehave not acted as auditors and the financial statements of the subsidiaries for which an audit is notrequired by the countries of incorporation, being financial statements that have been included inthe consolidated financial statements. The names of these subsidiaries are disclosed in note 5 to thefinancial statements.

We are satisfied that the financial statements of the subsidiaries that have been consolidated withthe financial statements of the Company are in form and content appropriate and proper for thepurposes of the preparation of the consolidated financial statements and we have received satisfactoryinformation and explanations as required by us for those purposes.

The auditors’ reports on the financial statements of the subsidiaries were not subject to anyqualification and in respect of subsidiaries incorporated in Singapore did not include any commentmade under Section 207(3) of the Act.

KPMGCertified Public Accountants


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Note 1999 1998$’000 $’000

Fixed Assets 3 654,808 668,569

Investment Properties 4 495,000 504,000

Interests in Associated Companies 6 233,792 449,852

Other Investments, Advances and Deferred Expenditure 7 42,898 55,581

Interests in Limited Partnerships 8 – 16,521

Current Assets 9 165,914 147,183

Less:

Current Liabilities 15 335,987 440,062

Net Current Liabilities (170,073) (292,879)

Long-Term Liabilities 21 (460,580) (601,026)

795,845 800,618

Representing:

Share Capital 23 179,631 179,323

Reserves 24 615,214 621,295

Share Capital and Reserves 794,845 800,618

Minority Interests 1,000 –

795,845 800,618

The notes set out on pages 46 to 89 form part of these financial statements.

Consolidated Balance Sheeta s a t 3 1 D e c e m b e r 1 9 9 9

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40 Consolidated Profit and Loss Accountf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

Note 1999 1998$’000 $’000

Turnover 2.9 386,684 354,574

Profit before taxation, exceptional itemsand extraordinary items

The Group 25 41,325 26,366Share of results of associated companies 4,154 7,468

45,479 33,834

Exceptional Items 26 3,176 3,284

Profit before taxation and extraordinary items 48,655 37,118

Taxation 27 (13,314) (11,285)

Profit after taxation but before minority interestsand extraordinary items 35,341 25,833

Minority Interests 3,500 2,147

38,841 27,980

Extraordinary Items 28 84,992 (5,382)

Profit after taxation and extraordinary items 123,833 22,598

Appropriations:

Interim dividend of 5% (1998: 2.5%) less 26% tax (6,653) (3,337)Proposed final dividend of 8% (1998: 6%)

less 25.5% tax (10,699) (7,962)

(17,352) (11,299)

Retained Profit transferred to Revenue Reserves 24(e) 106,481 11,299

Earnings per share (in cents): 29

Before extraordinary items

– Basic 10.82 8.47

After extraordinary items

– Basic 34.50 6.84


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41Consolidated Statement of Cash Flowsf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

1999 1998$’000 $’000

Cash Flow from Operating Activities:Profit before taxation 48,655 37,118Adjustments for:

Depreciation 28,877 25,454Share of results of associated companies (4,154) (7,468)(Profit)/Loss on disposal of fixed assets (3,392) 342Deferred expenditure written off 1,083 958Provision against advances to an associated company (1,151) -Exchange differences 2,084 2,218Dividend income (783) (1,127)Interest income (2,281) (6,999)Interest expense 44,132 57,501

Operating profit before working capital changes 113,070 107,997(Increase)/Decrease:

Completed properties held for resale 8,088 9,459Quoted investments 315 4,326Trade and other receivables (5,314) 4,301Stocks (1,973) 118

Increase/(Decrease):Trade and other creditors (33,622) 5,771

Cash generated from operations 80,564 131,972Interest paid (22,075) (65,227)Income taxes paid (9,466) (21,214)Dividends received 572 823Interest received 2,274 7,021

Net cash inflow from operating activities 51,869 53,375

Cash Flows from Investing Activities:Purchase of fixed assets (27,400) (66,667)Proceeds on sale of fixed assets 11,182 1,061Acquisition of subsidiaries, net of cash acquired (9,850) (608)Proceeds from dilution of subsidiary, net of cash diluted – 439Repayment of cost of acquisition of subsidiary by vendor 654 1,660Redemption of preference shares by an associated company 6,349 1,172Investment in associated companies (3,060) –Advances from associated companies 165,161 886Dividends received from associated companies 13,783 1,198Advances to partnerships – (668)Proceeds on capital reduction of long-term investments – 297Advances for long-term receivables 6 (765)Payments for deferred expenditure (90) (907)Proceeds on disposal of long term investments 1,325 –

Balance carried forward 158,060 (62,902)

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42 Consolidated Statement of Cash Flowsf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

1999 1998Note $’000 $’000

Balance brought forward 158,060 (62,902)Cash refunded paid for tenancy deposits (468) (460)Expenditure incurred on investment properties (7,662) –Proceeds on disposal of interests in limited partnerships 47,727 74,236Proceeds on disposal of shares in subsidiaries,

net of cash disposed 4,414 –Proceeds on disposal of shares in associated company

to minority interests 12,673 –

Net cash inflow from investing activities 214,744 10,874

Cash Flows from Financing Activities:

Repayment of bank loans (263,492) (59,294)Repayment to hire purchase creditors (508) –Issue/(Repayment) of Floating Rate and Hybrid Notes 33,500 (34,955)Repayment of bond issue – (50,000)Dividends paid (14,615) (10,456)Dividends paid to minority shareholders (140) (341)Subscription of shares by minority interest 1,076 41Exercise of options and warrants 2,143 72,158

Net cash outflow from financing activities (242,036) (82,847)

Net Increase /(Decrease) in Cash andCash Equivalents during the year 24,577 (18,598)

Cash and Cash Equivalents at beginning of the year 36 28,544 47,141

Exchange Fluctuation on Cash andCash Equivalents at beginning of the year 331 1

28,875 47,142

Cash and Cash Equivalents at end of the year 36 53,452 28,544

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43Consolidated Statement of Cash Flowsf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

During the financial year, the Group acquired certain subsidiaries. The fair values of assets acquiredand liabilities assumed were:

1999 1998$’000 $’000

Fixed assets – 49Interest in associated company 10,534 –Current assets 317 531Current liabilities (12,298) (143)

Net (liabilities)/assets acquired (1,447) 437Minority interests – (200)Goodwill – 873

(1,447) 1,110Cash acquired (1) (502)Amounts due to the Company 11,298 –

Acquisition of subsidiaries, net of cash acquired 9,850 608

In the previous financial year, the Group diluted its interest in a subsidiary. There was no dilutionof interest of investment in subsidiaries during the financial year. The net book values of assets andliabilities diluted were:

1999 1998$’000 $’000

Fixed assets – 3Current assets – 115Current liabilities – (161)

Net assets diluted – (43)Minority interests – 21Transfer to investment in associated company – 17Profit on dilution of subsidiary – 555

– 550Cash diluted – (111)

Dilution of subsidiary, net of cash diluted – 439

During the financial year, the Group disposed of its interest in a subsidiary. The net book values ofassets and liabilities disposed of were:

1999 1998$’000 $’000

Fixed assets 673 –Current assets 1,669 –Current liabilities (1,375) –

Net assets disposed 967 –Transfer to investment in associated company 1,007 –Gain on disposal of subsidiary 2,790 –

4,764 –Cash disposed (350) –

Disposal of subsidiary, net of cash disposed 4,414 –


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44 Balance Sheeta s a t 3 1 D e c e m b e r 1 9 9 9

1999 1998Note $’000 $’000

Interests in Subsidiaries 5 839,678 825,181

Interests in Associated Companies 6 (116,237) 58,412

Other Investments, Advancesand Deferred Expenditure 7 1,291 2,249

Current Assets 9 44,861 42,580

Less:

Current Liabilities 15 35,802 174,432

Net Current Assets/(Liabilities) 9,059 (131,852)

Long-Term Liabilities 21 (300,000) (327,375)

433,791 426,615

Representing:

Share Capital 23 179,631 179,323

Reserves 24 254,160 247,292

Share Capital and Reserves 433,791 426,615


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45Profit and Loss Accountf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

1999 1998Note $’000 $’000

Turnover 2.9 63,866 61,498

Profit before taxation and extraordinary items 25 31,920 22,416

Taxation 27 (9,534) (7,521)

Profit after taxation but before extraordinary items 22,386 14,895

Extraordinary items 28 (3,200) (1,000)

Profit after taxation and extraordinary items 19,186 13,895

Appropriations:

Interim dividend of 5% (1998: 2.5%) less 26% tax (6,653) (3,337)Proposed final dividend of 8% (1998: 6%) less 25.5% tax (10,699) (7,962)

(17,352) (11,299)

Retained Profit transferred to Revenue Reserves 24(e) 1,834 2,596


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46 Notes to the Financial Statementsf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

These notes form an integral part of and should be read in conjunction with the accompanyingbalance sheets, profit and loss accounts and consolidated statement of cash flows.

1. Principal Activities

The principal activities of the Company, which is incorporated in the Republic of Singapore, arethose relating to investment holding while those of the subsidiaries consist of the business of:

(a) private hospital ownership and management and related healthcare services,

(b) ownership and management of medical clinics,

(c) dealing in medical supplies, equipment and healthcare products,

(d) practice of dental surgeons and the operation of dental clinics,

(e) provision of clinical research centre,

(f) providing industrial, clinical and medical laboratory testing and consultancy services,

(g) property investment and development,

(h) investment holding and trading, and

(i) advertising and building management agency.

2. Summary of Significant Accounting Policies

The following are the principal accounting policies which have been adopted in the preparationof the accompanying financial statements.

2.1 Basis of Financial Statements Preparation

The financial statements, expressed in Singapore dollars, are prepared in accordance withthe historical cost convention as modified by the revaluation of certain fixed assets andinvestment properties.

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2. Summary of Significant Accounting Policies (cont’d)

2.2 Basis of Consolidation

(a) The consolidated financial statements include the financial statements of theCompany and of its subsidiaries.

(b) The consolidated financial statements include the financial statements of theCompany and its subsidiaries made up to the end of the financial year. All transactionsbetween the consolidated companies are eliminated. The results of subsidiariesacquired and disposed of during the year are included from the effective date ofacquisition and up to the effective date of disposal.

(c) Fair values are assigned to the assets, principally land and buildings, properties andinvestments, owned by the subsidiaries at the date of acquisition as determined by thedirectors. The directors’ valuations are, where appropriate, based on independentprofessional valuations. Any excess or deficiency of the consideration over the net assets(at fair values assigned by the directors) at the date of acquisition is included in goodwillon consolidation or capital reserve on consolidation. Goodwill on consolidation is writtenoff against reserves or, where appropriate, amortised over its estimated useful life.

2.3 Fixed Assets and Depreciation

(a) Land and buildings are stated either at cost less depreciation or at directors’ valuationwhich comprises net book value to the subsidiaries and an allocation of the excess ofpurchase consideration payable by the Group over the net book value of the land andbuildings of the subsidiaries at the date of acquisition. Other fixed assets are stated atcost less depreciation. There is no formal policy for the revaluation of fixed assets.

(b) Fixed assets are depreciated on the straight line basis over their estimated usefullives as follows:

Leasehold land and building – remaining term of the leaseOffice premises – 2%Medical centre suites – 1%Buildings – 1%Hospital and medical equipment, and furniture, fittings and equipment – 7% to 331/3%Renovation and improvements – 162/3% to 331/3%Motor vehicles – 10% to 331/3%

No depreciation is provided on freehold land and construction in progress.

2.4 Investment Properties

Investment properties are those properties which are not held with the intention of salein the ordinary course of business.

Investment properties are revalued annually based on independent professional valuationon an open market value basis. The surplus or deficit on revaluation is taken to therevaluation reserve account except when the total of the reserve is not sufficient to coverthe deficit. In such cases the amount by which the deficit exceeds the revaluation reservewill be charged to the profit and loss account.

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2.5 Investments in Associated Companies

(a) Associated companies are those companies in which a long-term equity interest ofbetween 20% and 50% is held by the Group and where there is management participation.

(b) The Group’s share of the results of the associated companies is included in theconsolidated profit and loss account. The Group’s share of the retained earningsand reserves of the associated companies is included as interests in associatedcompanies in the consolidated balance sheet.

For this purpose, the latest audited financial statements of the associated companiesare used. Where audited financial statements are not available, unauditedmanagement financial statements are used.

(c) Provision for diminution in value of the investments would be made if the directorsconsider that there had been a decline in their values that is other than temporary.

2.6 Investments

(a) Quoted and unquoted equity investments held on long-term basis are stated at cost.Provision would be made for diminution in the value of these investments if the directorsconsider that there had been a decline in their values that is other than temporary.

(b) Investments held on short-term basis are stated at the lower of cost and marketvalue on an item-by-item basis.

2.7 Completed Properties Held for Resale

(a) Completed properties are those properties which are held with the intention of salein the ordinary course of business and are classified as current assets.

(b) All completed properties are stated at the lower of cost and estimated net realisable value.

2.8 Stocks

Stocks comprising mainly pharmacy stocks and hospital and surgical supplies are valuedat the lower of cost (determined principally on the first-in first-out basis) and estimatednet realisable value.

2.9 Turnover

(a) The Group

Turnover comprises invoiced value of hospital services billed, proceeds from sale ofproperties and quoted equity investments, trading sales, invoiced value of servicesprovided and rental income. Inter-company transactions are excluded.

(b) The Company

Turnover comprises gross dividend income and interest income.

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2.10 Income Recognition

(a) Profits from the sale of development properties are recognised when the units aresold and upon the granting of the Temporary Occupation Permit and to the extentof progress billings made. The amount of the progress billings and the correspondingcosts are then taken to the profit and loss account. Provision is made for anticipatedlosses if and when they can be determined.

(b) Dividend income from subsidiary and associated companies are recognised as soonas such dividends are proposed and declared by these companies.

(c) Dividend income from other investments are recognised on receipt of such dividend.

2.11 Provision for Doubtful Debts

Specific provision is made for accounts which are doubtful of collection. A general provisioncalculated as a percentage of overdue debts is also made.

2.12 Deferred Taxation

Deferred taxation is provided, using the liability method, on timing differences otherthan those which can be demonstrated with reasonable probability to continue into thefuture. A deferred tax benefit is, however, not recognised in the financial statementsexcept when there is a reasonable expectation of realisation.

2.13 Currency Translation

(a) Monetary assets and liabilities in foreign currencies are translated into reportingcurrencies at rates of exchange closely approximate to those ruling at the balancesheet date. Transactions in foreign currencies during the year are translated at ratesprevailing on transaction dates. Translation differences are included in the profitand loss account.

(b) The financial statements of foreign subsidiaries and associated companies aretranslated into Singapore dollars at rates of exchange closely approximate to thoseruling at the balance sheet date. Translation differences are dealt with throughExchange Fluctuation Reserves.

2.14 Deferred Expenditure

Deferred expenditure comprises expenses incurred in the recruitment and training ofnurses and management fees for arrangement of banking facilities.

The expenses incurred in the recruitment and training of nurses are written off over theperiod of the service agreements of the respective nurses ranging from 3 to 5 years.Management fees for arrangement of banking facilities are written off over the period ofthe facilities.

Notes to the Financial Statementsf o r t h e y e a r e n d e d 3 1 D e c e m b e r 1 9 9 9

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3. Fixed Assets – The Group

Hospital Land and Buildings Medical Leasehold Renovation Furniture,Freehold Leasehold Freehold Leasehold Construction Centre Office & improve- Fittings & Motor

Valuation Cost in progress Suites Premises ments Equipment Vehicles Total$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Cost/Valuation

At beginning of the year 85,703 290,692 99,307 100,017 11,982 4,455 11,968 3,116 208,936 4,575 820,751

Additions – – 1,303 449 10,117 – – 1,575 11,853 840 26,137

Reclassifications – – 331 3,905 (4,516) – – (3) 283 – –

Disposals – – (334) (663) (354) (2,521) – – (12,163) (1,157) (17,192)

Disposal of subsidiary – – – – (30) – – – (548) – (578)

Translation difference

on opening balance 28 – 2 (3,120) 40 – – 1 (859) (1) (3,909)

At end of the year 85,731 290,692 100,609 100,588 17,239 1,934 11,968 4,689 207,502 4,257 825,209

Accumulated Depreciation

At beginning of the year 8,466 29,628 4,592 1,707 – 124 1,887 1,884 101,392 2,502 152,182

Charge for the year 273 3,654 1,612 2,207 – 63 218 432 19,863 555 28,877

Reclassifications (339) 339 312 – – – – – (312) – –

Disposals – – (112) (42) – (113) – – (9,397) (874) (10,538)

Disposal of subsidiary – – – – – – – – (31) – (31)

Translation difference

on opening balance 6 – – (25) – – – 1 (70) (1) (89)

At end of the year 8,406 33,621 6,404 3,847 – 74 2,105 2,317 111,445 2,182 170,401

Depreciation charge

for 1998 475 2,693 1,079 760 – 68 217 323 19,291 548 25,454

Net book value at

31 December 1999 77,325 257,071 94,205 96,741 17,239 1,860 9,863 2,372 96,057 2,075 654,808

Net book value at

31 December 1998 77,237 261,064 94,715 98,310 11,982 4,331 10,081 1,232 107,544 2,073 668,569

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3. Fixed Assets – The Group (cont’d)

Unless otherwise indicated, the fixed assets are stated at cost.

The freehold hospital land and building, at valuation, comprises the following:

(a) The 1987 directors’ valuation of the land and buildings at Gleneagles Hospital and MedicalCentre was based on an independent professional valuation carried out by Jones LangLaSalle (formerly known as Jones Lang Wootton) in May 1987 on the basis of openmarket valuation at $28,422,000.

(b) The 1989 directors’ valuation of the land and buildings at Pulau Pinang Hospital wasbased on independent professional valuations carried out by Knight Frank Pte Ltd inOctober 1989 on the basis of open market valuation at RM13,916,000 ($6,103,000).

(c) The 1995 directors’ valuation of the land and buildings at East Shore Hospital was basedon independent professional valuations carried out by Knight Frank Pte Ltd in June 1995on the basis of open market valuation at $51,205,000.

(d) The 1995 directors’ valuation of the leasehold hospital land and buildings at MountElizabeth Hospital and Eastern Specialist Centre was based on an independent professionalvaluation carried out by Knight Frank Pte Ltd in June 1995 on the basis of open marketvaluation at $290,692,000.

Included in construction in progress is interest capitalised of $Nil (1998: $371,000) and includedin hospital land and building is interest capitalised of $15,467,000 (1998: $16,003,000) of which$Nil (1998: $9,961,000) has been transferred from construction in progress during the year.

For assets which have been revalued, the net carrying amount as at 31 December 1999 hadthe assets been carried at cost less depreciation are as follows:-

1999 1998$’000 $’000

Freehold land 2,228 2,228Leasehold land 33,389 33,832Leasehold building 60,219 61,027

95,836 97,087

Included in the fixed assets are assets with net book value of $193,880 (1998: $387,532)which were acquired under hire purchase financing.

4. Investment Properties – The Group

Investment properties are stated at an independent professional valuation carried out by KnightFrank Pte Ltd in January 2000, in respect of the value as at 31 December 1999 on the basis ofopen market valuation, at $495,000,000 (1998: $504,000,000). The deficit of $16,662,000(1998: $43,000,000) arising from the revaluation has been taken directly to Revaluation Reserves.


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5. Interests in Subsidiaries – The Company

Place ofPrincipal Incorporation/ EquityActivities Business Interest Cost

1999 1998 1999 1998% % $’000 $’000

Unquoted ordinaryshares at cost:

Parkway Properties Property Singapore 100 100 160,120 160,120Pte Ltd and its investmentsubsidiaries:

Parkway Promotions Advertising Singapore 100 100Pte Ltd agency

Development Building Singapore 100 100Planning and managementManagementPrivate Limited

** Parkway Panama Investment Panama 100 100 # #Limited Inc holding

Parkway Land Pte Ltd Dormant Singapore 100 100 18,505 18,505

M & P Investments Investment Singapore 100 100 # #Pte Ltd and its trading andsubsidiaries: property

development

S.P.I. Pte Ltd Investment Singapore 100 100trading

Trademart Builders Dormant Singapore 100 100Pte Ltd

Rylands Investments Dormant Singapore 100 100 # #Pte Ltd

Weian Investments Dormant Singapore 51 51 102 102Pte Ltd and itssubsidiary:

Parkway (PNG) Dormant Papua New – 100Pty Limited Guinea

Balance carried forward 178,727 178,727


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5. Interests in Subsidiaries – The Company (cont’d)


1999 1998 1999 1998% % $’000 $’000

Balance brought forward 178,727 178,727

## Parkway Group Investment Singapore 100 100 494,188 422,788Healthcare Pte Ltd holdingand its subsidiaries:

Parkway Managed Management Singapore see 100Care Pte Ltd of managed note

care and 32related services

Gleneagles Medical Health care Singapore 100 –Global Care and relatedPte Ltd services

Mount Elizabeth Investment Singapore 100 100Healthcare holdingHoldings Ltdand itssubsidiaries:

Mount Elizabeth Private Singapore 100 100Hospital hospital andLtd and its medical centresubsidiaries: ownership and

management

East Shore Private Singapore 100 100Hospital hospital andPte Ltd medical centre

ownership andmanagement

MENA Services Nursing Singapore 100 100Pte Ltd agency

Mount Elizabeth Rental of Singapore 66.48 66.48Ophthalmic medicalInvestments equipmentPte Ltd used for

eye operations



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1999 1998 1999 1998% % $’000 $’000


Medi-Rad Associates Operation of Singapore 83.27 83.27Ltd (formerly radiologyknown as clinicsMedi-RadAssociatesPte Ltd) andits subsidiary:

Khim Medicare Dormant Singapore 67.35 67.35PrivateLimited

Radiology Radiology Singapore 100 100Consultants consultancyPte Ltd and interpre-

tive services

Parkway Laboratory Provision of Singapore 100 100Services Ltd comprehensive(formerly known diagnosticas Parkway laboratoryLaboratory servicesServices Pte Ltd)

+ Mount Elizabeth Provision of Malaysia 100 100Healthcare laboratoryServices services toSdn Bhd and hospitalsits subsidiary: and clinics

Orifolio Options Investment Malaysia 100 –Sdn Bhd holding

Gleneagles Hospital Private Singapore 100 100Limited and its hospitalsubsidiaries: ownership and

management

Gleneagles Medical centre Singapore 100 100Medical development,Centre Ltd ownership and

management



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1999 1998 1999 1998% % $’000 $’000


Gleneagles Radiology Singapore 100 100Radiology consultancyConsultants and interpretivePte Ltd services

Gleneagles CRC Provision of Singapore 100 –Pte Ltd a clinical

research centre

Gleneagles Investment Singapore 100 100International holding andPte. Ltd. and managementits subsidiaries: services

+ Gleneagles Investment Malaysia 100 100(Malaysia) holdingSdn Bhdand itssubsidiary:

* Pulau Private Malaysia 70 70Pinang Clinic hospital Sdn Bhd ownership and

management

Gleneagles Providing Singapore 100 100Management advisory,Services Pte administrative,Ltd and its managementsubsidiary: and consultancy

services tohealthcarefacilities

** Gleneagles Dormant British 75 75 Heritage Virgin Hospital Islands Management Limited

Thermal Dealing in Singapore 51 51International medical supplies,(S) Pte Ltd equipment

and health-care products



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1999 1998 1999 1998% % $’000 $’000


* Thermal Dealing in Hong Kong 51 51International medicalLimited supplies,

equipmentand health-care products

Gleneagles Dormant Singapore 100 100PharmacyPte Ltd

Gleneagles Developing Singapore 100 100Development and managingPte Ltd turnkey hospital

projects

Gleneagles Nursing Providing Singapore 100 100Agency nursing andPte Ltd healthcare

services

+ Gleneagles Hospital Property United 65 65(UK) Limited investment Kingdomand its and lease ofsubsidiaries: equipment

+ The Heart Operation of United 100 100 Hospital heart testing Kingdom Limited clinics

+ The Heart Provision of United 100 100 Hospital medical equip- Kingdom Properties ment and Limited supplies

+ Wholebond Property United 100 100 Limited investment Kingdom

+ Cavendish Property United 100 100 Clinic investment Kingdom Limited and cardiac

testing



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1999 1998 1999 1998% % $’000 $’000


Gleneagles To manage Singapore 100 100Technologies constructionServices and renovationPte Ltd projects for

hospitals

Ko, Djeng To carry on Singapore 60 60Gleneagles the practicePte Ltd of dental

surgeons andto operatedental clinics

+ Merlion Healthcare Dormant United 100 100Limited Kingdom

Gleneagles To provide Singapore 68 68International industrial,Laboratory clinical andServices Pte medicalLtd and its laboratorysubsidiary: testing and

consultancyservices

Gleneagles Investment Singapore 100 100 Investment holding Fujian Pte Ltd

Gleneagles Investment Singapore 100 100International holdingGP Pte Ltd andits subsidiaries:

Gleneagles To provide Singapore 100 100 Maritime medical and Medical surgical advisory Centre services and the Pte Ltd treatment of

shipping crew



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1999 1998 1999 1998% % $’000 $’000


Shenton Investment Singapore 100 100 Medical holding Holdings Pte Ltd and its subsidiaries:

Shenton To provide Singapore 100 100 Medical medical and Centre surgical Pte Ltd advisory services

The Shenton To establish, Singapore 100 100 Medical maintain and Group carry on Pte Ltd business of

clinics

Executive To provide Singapore 100 100 Health comprehensive Screeners health check-ups, Pte Ltd health education

and medicalconsultation

Shenton To provide, Singapore – 100 Family establish and Medical carrying on Clinics the business Pte Ltd of clinics (formerly known as SOS Medical Emergencies Pte Ltd)

Shenton To provide, Singapore 100 – Family establish and Medical carrying on Clinics Pte the business Ltd (formerly of clinics known as SOS Medical Emergencies Pte Ltd)



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1999 1998 1999 1998% % $’000 $’000


* Gleneagles Dormant Hong Kong 100 100MaritimeMedical Centre(China) Limited

Nippon Medical Operation Singapore 60 60Care Pte Ltd of clinics

** Harborview Corporation Investment United 100 100 18,895 18,895Limited No. I and holding States ofits subsidiaries: America

** Airport Systems Investment United 80 80GP Inc. and holding States ofits subsidiaries: America

** Airport Systems Dormant United 100 100Minneapolis, States ofInc. America

** Airport Systems Dormant United 100 100Wisconsin, States ofInc. America

** PKWY/Swirnow Investment United 80 80Airways Inc holding States of

America

** Harborview Investment United 92 92Corporation holding States ofLimited No. II and Americaits subsidiaries:

** Parkway. Dormant United 51 51Swirnow, States ofIncorporated Americaand itssubsidiaries:

** Pier 500, Inc Dormant United 100 100States ofAmerica



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1999 1998 1999 1998% % $’000 $’000


** Harborview Dormant United 100 100 Marina, States of Inc America

* Nutpine Properties Property United 100 100 2 2Limited and its investment and Kingdomsubsidiary: development

* Saltplains Limited Property United 100 100development Kingdom

Westront Pte Ltd Investment Singapore 100 84 # #holding

Parkway Development Dormant Singapore 100 100 # #(China) Private Limited

** Fantasy Line Limited Investment Channel 100 100 # #holding Islands

691,812 620,412Less: Provision for diminution in value of investments (1,868) (1,868)

Dividends declared out of pre-acquisition reserves (1,712) (1,712)

688,232 616,832

Amounts due from subsidiaries (non-trade) 282,055 322,348Provision for doubtful debts (10,596) (10,596)

271,459 311,752Amounts due to subsidiaries (non-trade) (120,013) (103,403)

839,678 825,181

* Not audited by KPMG, Singapore.

** Not required to be audited by law in country of incorporation.

+ Audited by associated firms of KPMG, Singapore.

# Cost of investment of less than $1,000.

## Cost of investment in Parkway Group Healthcare Pte Ltd includes $110,078,000non-cumulative preference shares.


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Balances with subsidiaries are unsecured and are intended not to be repaid within the nexttwelve months. Certain balances are interest bearing.


(a) the Company acquired the remaining 16% equity interest in a subsidiary, Westront PteLtd, for a nominal consideration of $1.

(b) Gleneagles International GP Pte Ltd, a wholly-owned subsidiary, acquired 100% equityinterest in a related corporation, Shenton Family Medical Clinics Pte Ltd (formerly knownas SOS Medical Emergencies Pte Ltd) for a cash consideration of $2 from its wholly-ownedsubsidiary, Shenton Medical Holdings Pte Ltd.

(c) Parkway Group Healthcare Pte Ltd, a wholly-owned subsidiary, disposed of its 50% equityinterest in Parkway Managed Care Pte Ltd for a cash consideration of $2,304,500.

(d) Parkway (PNG) Limited, a wholly-owned subsidiary of Weian Investment Pte Ltd, wasde-registered.

6. Interests in Associated Companies

The Group The Company1999 1998 1999 1998$’000 $’000 $’000 $’000

Unquoted equity shares, at cost 69,107 75,112 50,329 56,678Unquoted preference shares, at cost 7,018 6,986 – –Quoted equity shares, at cost 155,556 154,832 – –

231,681 236,930 50,329 56,678

Share of post-acquisition:

Share premium 15,258 15,258 – –Revaluation reserves 3,277 126,400 – –Capital reserves 8,109 8,219 – –Retained earnings 132,291 57,014 – –

Balance carried forward 390,616 443,821 50,329 56,678


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6. Interests in Associated Companies (cont’d)


Balance brought forward 390,616 443,821 50,329 56,678

Amounts due from associatedcompanies (mainly non-trade) 15,869 13,691 1,351 1,914

Provision against amounts duefrom associated companies– non-trade (4,671) (4,664) – –– trade – (2,684) – –

11,198 6,343 1,351 1,914

Amounts due to associatedcompanies (non-trade) (168,022) (312) (167,917) (180)

233,792 449,852 (116,237) 58,412

Market value of quoted equity shares 123,742 77,411 – –

Balances with associated companies are unsecured and are not intended to be repaid withinthe next twelve months. Certain balances are interest bearing.

Details of associated companies are set out in note 32.


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7. Other Investments, Advances and Deferred Expenditure


Unquoted equity shares, at cost 5,280 5,280 1,013 1,013Provision for diminution in

value of investments (1,000) (1,000) (1,000) (1,000)

4,280 4,280 13 13

Quoted equity shares, at cost 23,105 27,839 – –Provision for diminution in

value of investments (4,000) (4,000) – –

19,105 23,839 – –

Other investments, at cost 12,464 17,524 – –

Notes receivable 7,000 6,968 – –Provision against note receivable (2,000) – – –

5,000 6,968 – –

Other receivables 180 110 – –Deferred expenditure:Opening balance 2,860 2,907 2,236 2,396Additions 90 907 – 798Translation difference on opening balance 2 4 – –Amount written off (1,083) (958) (958) (958)

1,869 2,860 1,278 2,236

42,898 55,581 1,291 2,249

Market value of quoted equity shares 12,443 12,299 – –

The notes receivable comprises:

(i) a note of $5,000,000 (1998: $4,977,000) which is secured and repayable over a term of5 years. Interest is charged at 8% (1998: 8%) per annum.

(ii) a note of $2,000,000 (1998: $1,991,000) which is non-interest bearing and unsecured,and has no fixed term of repayment.


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8. Interests in Limited Partnerships – The Group

These comprise interests of Nil% (1998: 79%) in BMC Lender Limited Partnerships (“BMCLLP”).

1999 1998$’000 $’000

Current account – BMCLLP – 16,521

During the financial year, the Group disposed of its interest in BMCLLP.

The partners’ current account balance is represented as follows:

1999 1998$’000 $’000

Fixed assets – 16,590Cash – 1,312Debtors – 295Intangibles – 1,950

– 20,147

Partners’ current accounts:Harborview Corporation Limited No. I and its subsidiaries – 16,521Other partners – 3,626

– 20,147

Movements in provision for doubtful amounts are as follows:

Balance at beginning of the year – 130,516Provision written off against loans and current accounts – (130,516)

Balance at end of the year – –

9. Current AssetsThe Group The Company

1999 1998 1999 1998Note $’000 $’000 $’000 $’000

Completed properties held for resale 10 17,768 24,924 – –Short-term investments 11 4,960 5,275 – –Stocks 12,506 10,559 – –Trade debtors 12 28,414 31,694 – –Other debtors, deposits and prepayments 13 21,878 15,823 2,594 53Tax recoverable 20,086 19,047 16,108 11,252Dividend receivable from:

subsidiaries – – 22,200 24,058associated companies – – – 326

Fixed deposits with financial institutions 14 20,009 14,675 3,081 6,033Cash in hand and at banks 40,293 25,186 878 858

165,914 147,183 44,861 42,580


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10. Completed Properties Held for Resale

In the previous financial year, a subsidiary, M & P Investments Pte Ltd, transferred one of itsproperties amounting to $2,570,000 to fixed assets. This property was purchased to operatea radiology clinic. The investment was valued at cost on the date of transfer and will bedepreciated over the remaining term of the lease.

11. Short-Term Investments – The Group1999 1998$’000 $’000

Quoted equity shares, at cost 9,008 14,350Quoted warrants, at cost 3 88Quoted other investments, at cost 213 792

9,224 15,230

Provision for diminution in value of investments (4,264) (9,955)

4,960 5,275

Market value of quoted investments:Equity shares 5,001 4,612Warrants 36 124Other investments 276 834

Movements in provision for diminution in valueof investments are as follows:

Balance at beginning of the year 9,955 15,590Provision written back during the year (3,176) (3,327)Investments written off against provision (2,515) (2,308)

Balance at end of the year 4,264 9,955

12. Trade Debtors – The Group1999 1998$’000 $’000

Trade debtors 39,234 40,688Provision for doubtful debts (10,820) (8,994)

28,414 31,694

Movements in provision for doubtful debts are as follows:

Balance at beginning of the year 8,994 8,762Provision made during the year 3,178 2,967Bad debts written off against provision for doubtful debts (1,350) (2,736)Translation difference on opening balance (2) 1



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13. Other Debtors, Deposits and Prepayments


Interest receivable 8 1 3 1Prepayments 3,563 1,664 61 40Recoverable expenses 2,200 2,080 – –Sundry deposits 3,245 1,368 – –Note receivable from a shareholder 133 134 – –

Non-trade debtors 16,095 14,154 2,530 12Less: Provision for doubtful amounts (3,366) (3,578) – –

12,729 10,576 2,530 12

21,878 15,823 2,594 53

Movements in provision for doubtfulamounts are as follows:

Balance at beginning of the year 3,578 3,283 – –Provision (written back)/

made during the year (228) 330 – –Translation difference on opening Balance 16 (35) – –

Balance at end of the year 3,366 3,578 – –

Included in the non-trade debtors is an advance amounting to $1,457,000 (1998: $Nil) grantedto a third party which became an associated company subsequent to the end of the year. Thisadvance is unsecured and interest free, and has no fixed terms of repayment. In addition, therewas an unsecured and interest free advance amounting to $2,518,000 (1998: $Nil) granted bythe Company to another third party, which was repaid subsequent to the end of the year.

14. Fixed Deposits with Financial Institutions – The Group

Fixed deposits of $1,406,000 (1998: $34,000) were pledged to banks for banking facilities(see note 18).


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15. Current LiabilitiesThe Group The Company

1999 1998 1999 1998Note $’000 $’000 $’000 $’000

Trade creditors and accruals 54,820 55,664 743 1,141Other creditors 16 17,321 29,305 196 235Hire purchase creditors 17 449 516 – –Bank overdrafts –

Secured 18 6,850 10,327 – –Unsecured – 990 – –

Short-term bank loans –Secured 19 6,864 28,591 – –Unsecured 110,664 276,094 24,164 165,094

Floating rate notes –Secured 20 95,000 – – –

Provision for taxation 33,320 30,613 – –Proposed dividend 10,699 7,962 10,699 7,962

335,987 440,062 35,802 174,432

16. Other CreditorsThe Group The Company

1999 1998 1999 1998$’000 $’000 $’000 $’000

Unclaimed dividends andloan stocks redemption 178 217 178 217

Non-trade creditors 3,586 3,956 18 18Retention payable 503 593 – –Rental deposits 1,161 2,255 – –Construction costs payable 7,726 11,190 – –Amount due for bank guarantee

granted to an associated company 4,167 11,094 – –

17,321 29,305 196 235

17. Hire Purchase CreditorsThe Group

1999 1998$’000 $’000

Balance owing under hire purchase agreement 868 1,441Less: Unexpired hire purchase interest (104) (169)

764 1,272

Payable:Within 12 months 449 516After 12 months 315 756

764 1,272


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18. Bank Overdrafts (Secured)

Bank overdrafts amounting to $4,652,000 (1998: $10,326,000) are secured by a legal mortgageon a subsidiary’s property stated at the financial statements at $88,135,000 (1998: $92,342,000),a debenture over the assets of the subsidiary and a guarantee by the Company.

The remaining bank overdraft is secured by pledge of a subsidiary’s fixed deposits (see note 14).

19. Bank Loans (Secured)The Group The Company

1999 1998 1999 1998$’000 $’000 $’000 $’000

(a) Repayable within one year

(i) Revolving credit facility 3,290 – – –

Secured by a legal mortgage of asubsidiary’s freehold property stated inthe financial statements at $5,178,000(1998: $Nil) and a debenture overits assets.

(ii) Revolving credit facility – 25,800 – –

Secured by pledge of quoted equityinvestments in an associated companystated in the financial statementsat $Nil (1998: $72,005,000) and aguarantee by the Company.

(iii) Short-term facility – 2,791 – –

Secured by a legal mortgage of asubsidiary’s property stated inthe financial statements at $Nil(1998: $92,342,000), debenture overthe assets of the subsidiary and aguarantee by the Company.

(iv) Term loan 2,697 – – –

Secured by a legal mortgage of asubsidiary’s property stated in thefinancial statements at $88,136,000(1998: $Nil) and a guarantee bythe Company.

(v) Term loan 877 – – –

Secured by a legal mortgage of asubsidiary’s freehold property stated inthe financial statements at $5,178,000(1998: $Nil) and debenture over its assets.

6,864 28,591 – –


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19. Bank Loans (Secured) (cont’d)The Group The Company

1999 1998 1999 1998$’000 $’000 $’000 $’000

(b) Repayable after one year

(i) Term loan 3,509 – – –

Secured by a legal mortgage of asubsidiary’s property stated in thefinancial statements at $5,178,000(1998: $Nil).

The loan is repayable in January 2002and interest is charged between 5.1% to6.9% (1998: Nil%) per annum.

(ii) Term loan 83,386 88,870 – –

Secured by a legal mortgage of asubsidiary’s property stated in thefinancial statements at $88,136,000(1998: $92,342,000) and a guaranteeby the Company.

The loan is repayable by July 2001and interest is charged at 6% (1998: 6%)per annum.

(iii) Revolving credit facility 3,412 – – –

Secured by a legal mortgage of asubsidiary’s property stated in thefinancial statements at $7,799,000(1998: $Nil) and an unconditionalguarantee by the ultimate parent company.

The loan is repayable by December 2001and interest is charged at 1.3125% aboveLIBOR (1998: Nil%) per annum.

(iv) Revolving credit facility – 45,194 – –

Secured by a legal mortgage of asubsidiary’s property stated in thefinancial statements at $Nil(1998: $112,555,000).

Interest is charged at Nil%(1998: 6.3% to 6.7%) per annum. Theloan was repaid during the year.

(v) Revolving credit facility – 5,981 – –

Secured by a legal mortgage of asubsidiary’s property stated in thefinancial statements at $Nil(1998: $5,154,000).

Interest is charged at Nil%(1998: 8.85% to 18.90%) per annum.The loan was repaid during the year.

90,307 140,045 – –

Total 97,171 168,636 – –


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20. Floating Rate NotesThe Group

1999 1998$’000 $’000

(i) $95,000,000 Floating Rate Notes due in June 2000issued in July 1995 by a subsidiary, Gleneagles HospitalLimited (“Gleneagles”) 95,000 95,000

(ii) $33,500,000 Floating Rate Notes due in 2005 issuedduring the financial year by a subsidiary, MountElizabeth Healthcare Holdings Ltd (“MEHHL”) 33,500 –

128,500 95,000

The $95 million Floating Rate Notes (“FRNs”) were reclassified to current liabilities during thefinancial year.

(a) The $95 million FRNs are due 2000 and secured by a first legal mortgage over Gleneagles’property stated in the financial statements at $113.1 million (1998: $112.6 million),together with an assignment of the insurance proceeds over the property. Interest on theFRNs is payable quarterly in arrears at an annual rate of 1.3% over the three-monthSingapore Interbank Offer Rate quoted by the Monetary Authority of Singapore. TheFRNs constitute direct and unconditional obligations of Gleneagles and rank pari passuwithout any preference or obligations having priority among themselves and at leastpari passu with all other unsecured obligations of Gleneagles (other than subordinatedobligations and obligations having priorities created by law).

(b) In 1998, MEHHL entered into an agreement with a bank to issue up to $60 million7 year FRNs due 2005. During the year, MEHHL issued FRNs amounting to $33.5 million.Interest is payable monthly, quarterly in arrears at an annual rate ranging from between1.625% to 3.625% per annum.

The FRNs constitute direct and unconditional obligations of MEHHL, and are secured bya negative pledge on two other subsidiaries. The FRNs rank pari passu without anypreference or priority among themselves and at least pari passu with all other unsecuredobligations of MEHHL (other than subordinated obligations and obligations havingpriorities created by law). Unless previously redeemed or purchased and cancelled, theFRNs are redeemable at their respective principal amounts in 2005.

21. Long-Term LiabilitiesThe Group The Company

1999 1998 1999 1998Note $’000 $’000 $’000 $’000

Tenancy deposits 7,870 8,338 – –Hire purchase creditors 17 315 756 – –Long-term bank loans:

Secured 19 90,307 140,045 – –Unsecured 22 300,000 327,375 300,000 327,375

Floating rate notes (Secured) 20 33,500 95,000 – –Deferred taxation 28,588 29,512 – –

460,580 601,026 300,000 327,375


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22. Long-Term Bank Loans (Unsecured)


(i) Revolving credit facility – 27,375 – 27,375

Interest is charged at Nil%(1998: 0.125%) per annum above thebank’s prevailing USD deposit rate.The loan was repaid during the year.

(ii) 5-year transferable loan facility 300,000 300,000 300,000 300,000

The loan is repayable by December2002 and interest is charged at 5.75%(1998: 5.75%) per annum.

300,000 327,375 300,000 327,375

23. Share Capital

The Company1999 1998$’000 $’000

Authorised:Ordinary shares of $0.50 each 250,000 250,000

Issued and fully paid:Balance at beginning of the year 179,323 160,334Ordinary shares issued pursuant to the exercise of warrants and share options 308 18,989


During the financial year, the Company issued 615,000 ordinary shares of $0.50 each forcash, following the exercise of options under the Parkway Employee Share Option Scheme(“Parkway Scheme”) as follows:

Number of shares Exercise Price Per Share

100,000 $3.538100,000 $3.394415,000 $3.490

615,000


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23. Share Capital (cont’d)

At the end of the financial year, unissued shares of the Company under option are as follows:

(i) 20,000 ordinary shares of $0.50 each at $3.394 per share exercisable between 17 April1996 and 16 February 2000 by grantees under the Parkway Scheme.

(ii) 240,000 ordinary shares of $0.50 each at $3.682 per share exercisable between 21 March1997 and 20 January 2001 by grantees under the Parkway Scheme.

(iii) 1,483,000 ordinary shares of $0.50 each at $5.690 per share exercisable between 3 April1998 and 2 February 2002 by grantees under the Parkway Scheme.

(iv) 1,060,000 ordinary shares of $0.50 each at $3.490 per share exercisable between 20April 1999 and 19 February 2003 by grantees under the Parkway Scheme.

24. ReservesThe Group The Company

1999 1998 1999 1998$’000 $’000 $’000 $’000

(a) Share Premium

Balance at beginning of the year 302,372 249,203 285,569 232,400Premium on shares issued pursuant

to the exercise of warrantsand share options 1,834 53,169 1,834 53,169

Balance at end of the year 304,206 302,372 287,403 285,569

(b) Capital Reserves

Balance at beginning of the year 26,442 25,635 17,362 17,362Share of capital reserves of

an associated company – 655 – –Transfer from revenue reserve

due to share buy back by anassociated company – 152 – –

Balance at end of the year 26,442 26,442 17,362 17,362

(c) Revaluation Reserves

Balance at beginning of the year 225,409 299,963 – –Deficit on revaluation of

investment properties (16,662) (43,000) – –Share of surplus/(deficit) in revaluation

reserves of associated companies 47 (32,611) – –Share of associated company’s

revaluation reserves realisedon sale of investment property (123,981) – – –

Goodwill on consolidation written back 662 1,057 – –

Balance at end of the year 85,475 225,409 – –

Balance carried forward 416,123 554,223 304,765 302,931


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24. ReservesThe Group The Company

1999 1998 1999 1998$’000 $’000 $’000 $’000

Balance brought forward 416,123 554,223 304,765 302,931

(d) Exchange Fluctuation Reserves

Balance at beginning of the year (51,307) (45,698) (5,987) (9,987)Share of associated company’s

exchange fluctuation reserve 43 (30) – –Exchange differences on:

Retranslation of opening net assets of foreign subsidiaries and associated companies 3,447 (9,579) – –Realised exchange on sale of foreign investments 3,200 4,000 3,200 4,000

Transfer to profit and loss account -being exchange loss on long-termforeign investments now realized(see note 28) 19,185 – – –

Balance at end of the year (25,432) (51,307) (2,787) (5,987)

(e) Revenue Reserves

Balance at beginning of the year 118,379 107,333 (49,652) (52,248)Retained profit for the year 106,481 11,299 1,834 2,596Share of associated company’s

revenue reserves (337) (101) – –Transfer to capital reserves due

to share buy back by anassociated company – (152) – –

Balance at end of the year 224,523 118,379 (47,818) (49,652)

Total reserves 615,214 621,295 254,160 247,292

The Group1999 1998$’000 $’000

Revenue Reserves

Retained in the:Company (47,818) (49,652)Subsidiaries 140,050 111,017Associated companies 132,291 57,014

224,523 118,379


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25. Profit before Taxation, Exceptional Items and Extraordinary Items

The Group The Company1999 1998 1999 1998

Note $’000 $’000 $’000 $’000

Profit before taxation is arrivedat after charging:

Auditors’ remuneration –Auditors of the Company:– Current year 423 423 52 53– Under/(Over) provision in

respect of prior year 1 (11) (1) –Other auditors:– Current year 128 130 – –– Underprovision in respect

of prior year – 3 – –Directors’ fee:

Directors of the Company– Current year 183 202 183 193– Under/(Over) provision

in respect of prior year 65 (27) – (27)Other directors 25 333 – –

Remuneration paid to directorsas executives:

Directors of the Company 3,655 1,006 – –Other directors 2,924 2,864 – –

Consultancy fees paid to directorsof subsidiaries 60 407 – –

Consultancy fees paid to a firm inwhich a director of a subsidiaryhas substantial interest – 60 – –

Professional fees paid to a firm ofwhich a director of theCompany is a member 12 95 12 95

Rental and management fees paidto a company in whicha director of a subsidiary hassubstantial interest 424 424 – –

Depreciation of fixed assets 3 28,877 25,454 – –Stocks written off 36 24 – –


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25. Profit before Taxation, Exceptional Items and Extraordinary Items (cont’d)


Note $’000 $’000 $’000 $’000

Interest expenseFRNs 4,111 8,561 – 1,972Bonds – 1,567 – 1,567Bank loans and overdrafts 40,021 47,373 28,257 29,885Loans from subsidiary – – 1,485 1,387

Bad debts written off (trade) 54 241 – –Provision for doubtful trade debts 12 3,178 2,967 – –Deferred expenditure written off 7 1,083 958 958 958Loss on disposal of quoted

investments – 3,709 – –Provision for doubtful amounts

(non-trade) 13 – 330 – –Loss on disposal of fixed assets – 342 – –Loss on exchange 2,490 2,105 550 2,425

And crediting:

Gross dividends -Quoted equity investments 205 727 – –Unquoted equity investments

in subsidiaries – – 40,700 51,610Unquoted equity investments

in associated companies – – 15,084 517Other unquoted equity

investments 400 400 – –Provision for doubtful amounts

written back – non-trade 13 228 – – –Interest income –

Subsidiaries – – 7,331 8,831Associated companies 83 89 83 89Banks and financial institutions 1,931 1,684 657 451Quoted loan stocks 14 64 – –Unquoted bonds – 7 – –Others 253 5,155 11 –

Profit on disposal of fixed assets 3,392 – – –Bad debts (trade) recovered 28 457 – –Provision for quoted equity

investments written back 11 3,176 3,327 – –

During the year, the auditors of the Company were paid fees of $8,500 (1998: $16,000) and$547,000 (1998: $130,000) by the Company and the Group respectively in respect ofother services.


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26. Exceptional Items

This relates to write back of provision for diminution in value of short-term quotedequity investments.

27. Taxation


Current taxation:

Based on results for the year 20,493 9,779 9,534 7,521Over provision in respect

of prior years (8,831) (162) – –

Deferred taxation:

Based on results for the year (1,057) 1 – –Under provision in respect

of prior years 130 62 – –

Share of tax in associated companies 2,579 1,605 – –

13,314 11,285 9,534 7,521

The Company

The amount of income tax charged in the financial statements is higher than that arrived atby applying the standard rate of tax to the profit for the year because of the disallowance ofcertain expenses for tax purposes.

The Group

The amount of income tax charged in the financial statements is higher than that arrived atby applying the standard rate of tax to the profit for the year because of the disallowance ofcertain expenses for tax purposes and losses in certain subsidiaries which are not allowed tobe offset against the profits of other subsidiaries.

At the balance sheet date, certain subsidiaries have unutilised tax losses and unabsorbed wearand tear allowances totalling approximately $8,335,000 (1998: $8,511,000). These areavailable for offset against future taxable income in their respective financial statements, thebenefit of which has not been accounted for in the consolidated financial statements inaccordance with the Group’s accounting policy set out in note 2.12.


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28. Extraordinary Items


Note $’000 $’000 $’000 $’000

Other investments written off (8,469) (5,000) – (1,000)Provision for doubtful debts

– notes receivable (non-trade) 7 (2,000) – – –Provision for guarantees provided

for banking facilities of anassociated company (753) (2,500) – –

Profit on disposal of landattributable to sale of medicalcentre suites 1,404 1,866 – –

Gain on disposal of quoted/unquoted long-termequity investments 131 541 – –

Gain/(loss) on disposal of:– subsidiary 2,790 555 – –– limited partnerships 27,932 (2,081) (3,200) –

Transfer from ExchangeFluctuation Reserve– being exchange loss on

long-term foreigninvestments now realised 24(d) (19,185) – – –

Share of associated companies’extraordinary items:– write down of assets

to net realizable value (1,635) (1,500) – –– provision for diminution in

value of long term investment (9,589) (2,673) – –– profit on sale of property – 6,483 – –– provision for reorganisation

cost written back/(off) (208) 324 – –– gain/(loss) on disposal

of subsidiaries 234 (1,397) – –– gain on disposal of long-term

investment 5,107 – – –– realisation of revaluation

surplus on the sale of property 89,060 – – –– additional gain arising

from a business disposedin prior year 798 – – –

– deposit for share optionwritten off (625) – – –

84,992 (5,382) (3,200) (1,000)

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29. Earnings Per Share

The basic earnings per share is calculated based on the consolidated profit after taxation andminority interests but before extraordinary items of $38,841,000 (1998: $27,980,000) and theweighted average number of shares in issue of 358,954,480 (1998: 330,163,485).

30. Contingent Liabilities

At the end of the year, there were the following contingent liabilities:


(a) Unsecured contingent liabilitiesin respect of guarantees forbanking facilities granted to:

– subsidiaries – – 205,196 244,145– associated companies 5,798 – 5,798 –

5,798 – 210,994 244,145

(b) The Company and one of its subsidiaries, jointly and severally, unconditionally and irrevocably,undertake to a bank to provide funds to another subsidiary for any cost overrun in itshospital construction project in connection with credit facilities granted by the bank to thesubsidiary amounting to £35,000,000; $94,395,000 (1998: £35,000,000; $104,055,000).

(c) A subsidiary has agreed to indemnify a joint venture partner 50% of the guaranteedsum amounting to US$7,000,000; $11,665,500 (1998: US$Nil; $Nil) pursuant to theGuarantee Agreement executed between an associated company, the joint venture partnerand the bank on 8 July 1998.

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31. CommitmentsThe Group The Company

1999 1998 1999 1998$’000 $’000 $’000 $’000

(a) Capital expenditure not provided forin the financial statements:-

Amounts authorised andcontracted for 5,354 5,856 – –

Other amounts authorised butnot contracted for 4,470 3,827 – –

9,824 9,683 – –

(b) Commitments for equity investments 3,633 3,617 – –

(c) Forward foreign exchange contracts – 40,669 – 40,669

The forward foreign exchange contracts of US$Nil million (1998: US$25 million) enteredinto by the Group and the Company were to partially hedge against its US dollar borrowings.

(d) The Company entered into a Transferable Loan Facility Agreement of US$100 millionwith a bank and another Transferable Loan Facility Agreement of $300 million with twobanks. In consideration of the Facilities granted to the Company, the Company has executeda Deed of Undertaking for the following:

(i) the payment obligation under these Facilities will rank equally and rateably withall other unsecured indebtedness;

(ii) the Company and its subsidiaries, Parkway Group Healthcare Pte Ltd, MountElizabeth Hospital Ltd (“MEH”), Mount Elizabeth Healthcare Holdings Ltd, and EastShore Hospital Pte Ltd (“ESH”) will not create any security on or over their respectiveassets except for any existing securities;

(iii) the Company and its subsidiaries shall not sell, transfer, lease out or lend or otherwisedispose of all or part of its assets which could have a material adverse financialeffect on them;

(iv) the Company must ensure that there will not be any material changes in the natureof business for the Company and its subsidiaries;

(v) the Company must ensure that it will continue to own directly or indirectly not lessthan 75% to 80% of the shares of Gleneagles Hospital Limited, ESH and MEH; and

(vi) Parkway Properties Pte Ltd must ensure that there will be no further borrowings/guarantees other than for the indebtedness already incurred and it must continueto own Parkway Parade.

In addition, the Company has irrevocably granted to each of the two banks an option,exercisable at any time during the period of the Transferable Loan Facility of $300 million,to convert the outstanding Transferable Loan to 5.75% Guaranteed Bonds (“Bonds”) Due2002 in an aggregate principal amount equal to the principal amount of the Loan converted.

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31. Commitments (cont’d)

The aggregate amount of Bonds to be issued by the Company shall not exceed $300 million,shall bear interest at the rate of 5.75% per annum payable semi-annually in arrears and shallmature on 29 December 2002.

As at 31 December 1999, the banks have not converted the outstanding Transferrable Loaninto Guarantee Bonds Due 2002.

(e) The Sale & Purchase Agreement (“Agreement”) which a subsidiary, Gleneagles InternationalGP Pte Ltd, had signed with the vendors of its wholly-owned subsidiary, GleneaglesMaritime Medical Centre Pte Ltd (“GMMC”), provides for the payment of a second partconsideration of $2 million should GMMC’s cumulative profit at the end of the five-yearperiod after acquisition (in 1996) exceeds a specified target. The second part considerationcan be paid in cash or in shares of GMMC valued at eight times the most recent auditedafter tax profits of GMMC.

It is also provided in the Agreement that, if the Company or any of its related corporations isto be listed on the Singapore Exchange Securities Trading Limited, the vendors shall be entitledto receive the second part consideration in the form of new shares in the listed company.

As at 31 December 1999, this second part consideration has not been included in the costof investments in subsidiaries.

(f) An associated company has entered into an Investment Agreement with the InternationalFinance Corporation (“IFC”) to obtain a US$7 million loan from the IFC. The Company,its subsidiary, Gleneagles Development Pte Ltd, and the other shareholder of the associatedcompany are required to sponsor the loan and investment of IFC by entering into a putoption agreement in respect of 3,585,000 equity shares of the associated company andthe entering into of the Project Funds, Financial Support and Share Retention Agreement.

A subsidiary, Gleneagles Management Services Pte Ltd, has also agreed to subordinate itsmanagement fees agreement with the associated company in India to a bank for bankingfacilities amounting to US$7 million granted to the associated company.

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32. Associated Companies

EffectivePlace of Equity

Name of Company Principal Activities Incorporation Interest1999 1998

% %

Lee Hing Development Limited Property investment, Hong Kong 36 36and its subsidiaries: management and agent

Camanche Limited Investment holding Hong Kong 36 36

Kai Yiu Enterprises Limited Investment holding Hong Kong 36 36

Kwai Ling Enterprises Investment holding Hong Kong 36 36Company Limited

Lee Hing Investment Property and Hong Kong 36 36Company, Limited investment holding

Lucky Term Company Limited Investment holding Hong Kong 36 36

Tek Lee Nominees Limited Property and Hong Kong 36 36investment holding

Tory Company Limited Investment holding Hong Kong 36 36

Wang Tak Company Limited Investment holding Hong Kong 36 36

Diamond Way Inc. Investment holding Republic of Liberia 36 36

Hing Nam Limited Dormant Cayman Islands 36 36

HK 2 Limited Investment holding Republic of Liberia 36 36










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32. Associated Companies (cont’d)



% %

HK 333 Limited General investment Republic of Liberia 36 36



Lee Nam Limited Dormant Republic of Liberia 36 36

PRC 1 Limited Investment holding Republic of Liberia 36 36

PRC 18 Limited General investment Republic of Liberia 36 36

Stettler Investment Limited Investment holding Republic of Liberia 36 36

V12 Limited Investment holding Republic of Liberia 36 36

V168 Limited Investment holding Republic of Liberia 36 36

V338 Limited Dormant Republic of Liberia 36 36

Tan Nam Holdings Ltd. Investment holding Cayman Islands 36 36

Tan Nam Ltd. General investment Cayman Islands 36 36

Trademart Singapore Pte Ltd Operating of Singapore 50 50warehouses forrental and storage

Phil, Inc Property development, United States 40 40provision of construction of Americamanagement services

Trademart Management Management of Singapore 50 50Pte Ltd international

merchandise anddistribution centre

Blendkirk Limited and Property investment United 50 50its subsidiaries: and trading Kingdom

Validhill Limited Property investment United 50 50and trading Kingdom

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% %

Avidcrown Limited Property investment United 50 50and its subsidiaries: and trading Kingdom

15 Upper Grosvenor Property investment United 50 50Street Limited and trading Kingdom

16 Upper Grosvenor Property investment United 50 50Street Limited and trading Kingdom

Gleneagles Medical Medical centre Malaysia 30 30Centre (Kuala Lumpur) development, ownershipSdn Bhd and management

Gleneagles Hospital Private hospital ownership Malaysia 30 30(Kuala Lumpur) and managementSdn Bhd

Gleneagles Dialysis Provision of dialysis care Singapore 40 40International Pte Ltdand its subsidiary:

Gleneagles Dialysis Provision of business Singapore 44 44Centre Pte Ltd management, consultancy

and specialised medicalservices

PT Tritunggal Sentra Provision of medical Indonesia 30 30Utama, Surabaya diagnostic services

Kyami Pty Ltd Investment holding Australia 30 30and its subsidiaries:

Royalmist Properties Property investment Australia 30 30Pty Ltd and development

Fireace Pty Ltd Asset management Australia 30 30

Syntami Pty Ltd Property management Australia 30 30

Royalmist Pty Ltd Hotel and centre Australia 30 30management

Karington Holdings Pte Ltd Investment holding Singapore 50 50

PT Nusautama Private hospital ownership Indonesia 25 25Medicalindo and management

PT Siloam Gleneagles Private hospital ownership Indonesia 30 30Healthcare Tbk and management


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% %

Gleneagles International Private hospital ownership Sri Lanka 40 40Hospital (Lanka) Limited and management

Duncan Gleneagles Private hospital ownership India 50 50Hospital Ltd and management

Gleneagles Heritage Investment holding British Virgin 40 40Holdings Limited Islands

Renalcare Mount Elizabeth Provision of medical services Singapore 20 20Pte Ltd

Renalcare (Katong) Pte Ltd Provision of medical services Singapore 20 20

Auric Pacific Group Limited Food wholesaling and Singapore 22 22and its subsidiaries: distribution, food

manufacturing andinvestment

Auric Pacific Food Food wholesaling Singapore 22 22Industries Pte Ltd and distribution, and

food manufacturing

Auric Pacific Batam Pte Ltd Property investment Singapore 22 22

Sunshine Manufacturing Property investment Singapore 22 22Pte Ltd

Gourmet Foods Pte Ltd Property investment Singapore 22 22

Top-One Foods Pte Ltd Dormant Singapore 22 22

Auric Property Pte Ltd Property investment Singapore 22 22

Auric Pacific Property investment Singapore 22 22(International) Pte Ltd

Auric Pacific Enterprise Investment trading Singapore 22 22Pte Ltd

Auric Pacific Indonesia Dormant Singapore 22 22Pte Ltd

APG Foods Pte Ltd Investment trading Singapore 22 22(formerly known asAuric Pacific VenturesPte Ltd)


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% %

Auric Pacific (M) Food wholesaling Malaysia 22 22Sdn Bhd and distribution

Classic Aspire Sdn Bhd Investment holding Malaysia 22 22

Auric Pacific Marketing Food wholesaling Singapore 22 –Pte Ltd (formerly and distributionknown as EAC ConsumerProducts (S) Pte Ltd)

Sunshine Services Investment holding Hong Kong 22 22(HK) Ltd

Wellington Cold Refrigerated New 22 22Storage Limited warehousing Zealand

Cold Storage Holdings Dormant United 22 22P.L.C. Kingdom

C-Med Pte Ltd (formerly known Cyber-medicine and Singapore 50 –as Tele-Health Monitoring other relatedServices Pte Ltd) healthcare services

Parkway Managed Care Pte Ltd Management of managed Singapore 50 seecare and related services note 5

Mount Elizabeth Charter Provision of specialised Singapore 50 –Behavioural Services Pte Ltd medical services and

nursing and personalcare services


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33. Information Required by Paragraph 7

Ninth Schedule, Companies Act, Chapter 50

The Group’s and the Company’s liabilities and debts at the balance sheet date (excludingdeferred taxation, fixed deposits and cash in hand and at banks) are:

1999 1998Liabilities Debts Liabilities DebtsPayable Receivable Payable Receivable

The Group $’000 $’000 $’000 $’000

Within 1 year 504,323 86,248 441,130 72,908From 1 to 2 years 94,668 180 35,712 7,732

Within 2 years 598,991 86,428 476,842 80,640From 2 to 5 years 337,009 – 535,045 –

936,000 86,428 1,011,887 80,640

The Company

Within 1 year 323,733 302,108 278,015 349,355From 1 to 2 years – – 27,374 –

Within 2 years 323,733 302,108 305,389 349,355From 2 to 5 years 300,000 – 300,000 –

623,733 302,108 605,389 349,355

34. Segment InformationProfit Total

Turnover before tax Assets1999 $’000 $’000 $’000

Analysis by Activity

Healthcare 331,439 17,039 792,354Property and others 55,245 31,616 800,058

386,684 48,655 1,592,412

Geographical Analysis

Singapore 332,554 61,291 1,238,352Hong Kong 4,372 (713) 133,999Malaysia 14,564 (989) 32,332United States of America – 8,749 20,544United Kingdom 35,194 (19,893) 135,134Australia – 49 4,941Indonesia – – 17,665India – 161 9,445

386,684 48,655 1,592,412


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34. Segment InformationProfit Total

Turnover before tax Assets1998 $’000 $’000 $’000

Analysis by Activity

Healthcare 305,207 17,781 764,903Property and others 49,547 19,337 1,076,803

354,574 37,118 1,841,706

Geographical Analysis

Singapore 326,944 35,642 1,461,641Hong Kong 3,748 906 141,277Malaysia 12,658 (1,248) 28,777United States of America – 6,766 44,498United Kingdom 11,224 (5,492) 138,612Australia – 251 15,470Indonesia – – 524India – 293 8,859Sri Lanka – – 2,048

354,574 37,118 1,841,706

35. Subsequent Events

Subsequent to the balance sheet date,

(a) a subsidiary, Parkway Properties Pte Ltd entered into a conditional Sale and PurchaseAgreement with Prime Asset Holdings Pte Ltd (“PAHPL”) and Quintique Investments PteLtd, both subsidiaries of Asia Pacific Investment Company Limited, for the sale of all theretail units in Parkway Parade to PAHPL for a cash consideration of $457 million andoffice/medical clinics units in Parkway Parade to QIPL for a cash consideration of$23 million. The sale of these properties is scheduled to be completed in 3 months fromthe date of the Agreement subject to the fulfillment of certain conditions preceding.

(b) a subsidiary, Medi-Rad Associates Ltd (formerly known as Medi-Rad Associates Pte Ltd)was listed on the Singapore Exchange Securities Trading Limited on 23 March 2000. Inconnection with the initial public offering, Medi-Rad Associates Ltd acquired 100% equityinterest in Radiology Consultants Pte Ltd from MEH for a cash consideration of $13,089.

(c) two wholly-owned subsidiaries, MEH and Gleneagles International Pte Ltd (“GIPL”) andConsultant Neurospecialists Pte Ltd (“CN.S”) entered into a joint venture to form a newcompany in which MEH and GIPL will subscribe for a 24% and 25% stake respectively inthe new company, with the remaining 51% equity interests to be held by CN.S. Theprincipal activities of the new company are those relating to the provisions of clinical,consultancy and management services in relation to neurological disorders and relatedservices for neuroscience centre at MEH.

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35. Subsequent Events (cont’d)

(d) a subsidiary, Parkway Group Healthcare Pte Ltd (“PGH”) completed its subscription for a40% interest in Onemedhub.com Pte Ltd (formerly known as Onemed.com Global PteLtd) (“Onemedhub.com”).

(e) a subsidiary, Parkway Laboratory Services Ltd (formerly known as Parkway Laboratory ServicesPte Ltd) received the in-principle approval for its initial public offering from the SingaporeExchange Securities Trading Limited, which is expected to be launched in April 2000.

(f) a subsidiary, PGH, incorporated a wholly-owned subsidiary, Parkway Healthtech InvestmentsPte Ltd with an authorised share capital of $100,000 divided into 100,000 ordinary sharesof $1 each. 2 subscribers’ shares of $1 each fully paid were issued at par for cash.

(g) a subsidiary, MEH entered into a Release-License Agreement (“Agreement”) with CharterAdvantage LLC (“Charter”) to terminate a Conditional Joint Venture and ShareholdersAgreement and a Contribution Agreement previously entered into between the partiesrelating to the establishment of Mount Elizabeth-Charter Behavioural Health ServicesPte Ltd (“MECBHS”), an inpatient behavioural health unit at MEH. Pursuant to theAgreement, MEH shall acquire 50% equity interest in MECBHS for a nominal contributionof $1 from Charter, making it a wholly-owned subsidiary of MEH.

(h) a subsidiary, PGH, and an associated company, Onemedhub.com and SembCorp LogisticsLtd (“SCL”) to form a new company in Singapore to provide third party logistic services,including but not limited to, procurement, warehousing, inventory management anddistribution of medical, surgical and pharmaceutical products, equipment, instruments,drugs and other supplies to healthcare providers through electronic commerce. PGH andOnemedhub.com will subscribe 30% and 20% equity interests respectively in the newcompany, with the remaining 50% equity interests to be held by SCL.

36. Cash and Cash Equivalents

Cash and cash equivalents included in the Consolidated Statement of Cash Flows comprisethese balance sheet amounts:

1999 1998$’000 $’000

Opening balances:

Cash in hand and at banks 25,186 25,195Fixed deposits with financial institutions 14,675 28,216Bank overdrafts (11,317) (6,270)

28,544 47,141

Closing balances:

Cash in hand and at banks 40,293 25,186Fixed deposits with financial institutions 20,009 14,675Bank overdrafts (6,850) (11,317)

53,452 28,544

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37. Directors’ Remuneration

The remuneration of directors (including directors’ fees) of the Company is analysed as follows:

1999 1998Number of Number ofDirectors Directors

$500,000 and above 2 1$250,000 to $499,999 – 1Below $250,000 11 8

Total 13 10

38. Comparative Figures

Certain items in the comparative figures have been reclassified to conform with the currentyear’s presentation.

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90 Summary of Major Properties

The major properties of the Group are:Approximate Total Percentage

Site Area Lettable/Saleable owned byLocation (sm) Area (sm) The Group Tenure

SINGAPORE

1.* Parkway Parade, Marine Parade 29,407 Shops - 42,700 100% 99-year leasea 6-storey shopping Road on Offices - 17,700 22% commencingpodium cum 17-storey Lot 6649 Medical - 1,700 16% 17 August 1979office tower with Mukim 26 Centrebanks, medical centre Banking - 1,500 –and 1,343 car park lots Halls

63,600

2. Gleneagles Hospital, Lot 1345 14,947 Hospital - 25,000 100% Freeholda 380-bed hospital Town Subdivision Buildingand Gleneagles 25 situated atMedical Centre with 6/6A Napier Road Medical - 10,800 9%164 medical suites Centreand 402 car park lots

3. Mount Elizabeth Lot 858 Town 15,204 Hospital - 38,626 100% 99-year leaseHospital and Medical Subdivision 27 Building commencingCentre, a 505-bed situated at 3 1 October 1976hospital with 214 Mount Elizabeth Medical - 19,940 4%medical suites and Centre368 car park lots

4. East Shore Hospital Lot 6912 Mukim 6,200 Hospital - 10,926 100% Freeholdand Medical Centre, 26 situated at 321 anda 157-bed hospital Joo Chiat Place Medicalwith 28 medical suites Centreand 73 car park lots

5. Laboratories and Lot 2301/U2 940 Laboratories - 940 100% Freeholdoffices Mukim 1 situated and offices

at 213 HendersonRoad #01-02,#02-02, #03-02& #04-02 HendersonIndustrial Park

6. Eastern Specialist Lot 5188 Mukim 27 380 Clinic - 380 100% 86-year leaseCentre situated at Block 210 commencing

New Upper Changi 1 July 1992Road #01-699

7. Radiologic Clinic Lot 5350 Mukim 145 Clinic - 145 100% 91-year lease05 situated at Block commencing130 Jurong East 1 April 1993Street 13 #01-219

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91Summary of Major Properties

Approximate Total PercentageSite Area Lettable/Saleable owned by

Location (sm) Area (sm) The Group Tenure

OVERSEAS

8. Gleneagles Medical 1 Jalan Pangkor 7,319 Hospital - 8,700 70% FreeholdCentre, a 132-bed Penang Buildingprivate hospital, Malaysiaproposed expansion to250 beds is expected to becompleted by mid 2000

9. RS Siloam Gleneagles, 6 Jalan Siloam 17,443 Hospital - 30,010 30% 20-yeara 328-bed hospital Lippo Karawaci Building renewableand specialist 1600, Tangerang leaseoutpatient centre 15811, Jalva Barat

Indonesia

10. RS Gleneagles, Medan, Jln Listrik No. 6 12,065 Hospital - 25,637 25% 20-yeara 243-bed hospital Medan 20112 Building renewableand specialist Indonesia leaseoutpatient centre

11. Rumah Sakit Budi Jalan Raya Gubeng 6,862 Hospital - 6,392 30% 20-yearMulia, a 148-bed 70, Surabaya 60281 Building renewableprivate hospital Indonesia lease

12. Duncan Gleneagles, 58 Canal Circular 34,147 Hospital - 6,978 50% 30-year leasea 270-bed tertiary Road (off E M Building commencingacute care hospital Bypass) Calcutta - Vacant - 27,169 2 December 1994is expected to be 700 054 India Area

completed by end 2000 34,147

13. The Heart Hospital, 47 Wimpole Street 2,563 Hospital - 12,750 65% 200-year leasea 95-bed hospital London W1M 7D4 Building commencingand specialist United Kingdom 31 August 1994cardiac centre

* A subsidiary, Parkway Properties Pte Ltd entered into a conditional Sale and Purchase Agreement for thesale of the property in February 2000. The sale is expected to be completed in mid 2000.

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92 Comparative Figures for Financial Yearsa s a t 3 1 D e c e m b e r , 1 9 9 5 – 1 9 9 9

Summary of Consolidated Balance Sheets

1999 1998 1997 1996 1995$’000 $’000 $’000 $’000 $’000

Issued & fully paid-up capital 179,631 179,323 160,334 155,297 144,713Share premium 304,206 302,372 249,203 224,618 193,363Capital reserves 26,442 26,442 25,635 25,635 25,255Revaluation reserves 85,475 225,409 299,963 365,486 355,679Revenue reserves 224,523 118,379 107,333 127,547 90,484Exchange fluctuation reserves (25,432) (51,307) (45,698) (35,654) (35,045)

Total shareholders’ funds 794,845 800,618 796,770 862,929 774,449

These funds were represented bythe following net assets:

Current assets:Properties held for resale 8,454 15,610 25,672 26,556 23,609Completed properties 9,314 9,314 9,314 9,314 9,314Equity investments 4,960 5,275 9,601 43,525 43,288Stocks 12,506 10,559 10,673 9,362 8,267Debtors 70,378 66,564 60,106 60,505 57,985Fixed deposits, cash in hand

and at banks 60,302 39,861 53,411 42,772 48,276

Total current assets 165,914 147,183 168,777 192,034 190,739

Less Current liabilities:Creditors 72,590 85,485 79,105 77,577 63,320Short-term borrowings

including overdrafts 219,378 316,002 250,026 542,818 233,510Provision for income tax 33,320 30,613 33,016 33,486 35,419Proposed dividend 10,699 7,962 7,119 6,895 –

Total current liabilities 335,987 440,062 369,266 660,776 332,249

(DEFICIT) IN WORKING CAPITAL (170,073) (292,879) (200,489) (468,742) (141,510)Investment properties 495,000 504,000 547,000 576,520 562,220Interests in associated companies 233,792 449,852 487,954 494,040 455,303Fixed assets 654,808 668,569 619,147 588,882 576,343Other investments, advances and

deferred expenditure 42,898 55,581 36,570 7,433 9,240Interests in partnerships – 16,521 117,032 92,391 92,684

1,256,425 1,401,644 1,607,214 1,290,524 1,554,280

Less:Non-current liabilities 460,580 601,026 808,329 423,209 776,304Minority interests 1,000 – 2,115 4,386 3,527

Net assets 794,845 800,618 796,770 862,929 774,449

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93Comparative Figures for Financial Yearse n d e d 3 1 D e c e m b e r , 1 9 9 5 – 1 9 9 9

Summary of Consolidated Statements of Profit and Loss

1999 1998 1997 1996 1995$’000 $’000 $’000 $’000 $’000

Turnover 386,684 354,574 397,062 389,568 284,736

Trading profit andinvestment income 48,655 37,118 40,794 69,680 37,621

Income tax (13,314) (11,285) (22,373) (21,061) (14,430)

Profit after income tax 35,341 25,833 18,421 48,619 23,191Minority interests 3,500 2,147 1,246 (603) (173)Extraordinary items 84,992 (5,382) (26,698) 2,157 (93,703)

Net profit 123,833 22,598 (7,031) 50,173 (70,685)

Which were dealt with as follows:

Paid as dividends 17,352 11,299 13,183 12,547 5,341Added to capital reserves and/or

revenue reserves 106,481 11,299 (20,214) 37,626 (76,026)

123,833 22,598 (7,031) 50,173 (70,685)

Gross dividend ($) 0.07 0.04 0.06 0.06 0.03Earnings per share ($) 0.11 0.08 0.06 0.16 0.08Fully diluted earnings per share ($) 0.11 0.08 0.06 0.14 0.07Net tangible asset backing per share ($) 2.21 2.23 2.48 2.79 2.68

Analysis of Shareholdingsa s a t 1 4 A p r i l 2 0 0 0

Number of Percentage Number of PercentageRange of Shareholdings Shareholders (%) Shares (%)

1 – 1,000 1,139 36.96 882,592 0.241,001 – 10,000 1,649 53.50 5,939,529 1.65

10,001 – 1,000,000 279 9.05 17,213,207 4.791,000,001 and above 15 0.49 335,624,653 93.32

Total 3,082 100.00 359,659,981 100.00

Twenty Largest Shareholders (as shown in the Register of Members)a s a t 1 4 A p r i l 2 0 0 0

Number of PercentageName of Shareholders Shares (%)

1. Citibank Nominees Singapore Pte Ltd 81,270,341 22.602. Premierhealth Investments Pte Ltd 60,182,000 16.733. Raffles Nominees Pte Ltd 51,349,432 14.284. DBS Nominees Pte Ltd 44,512,112 12.385. Overseas Union Bank Nominees Pte Ltd 31,501,807 8.766. HSBC (Singapore) Nominees Pte Ltd 19,625,195 5.467. United Overseas Bank Nominees Pte Ltd 13,928,000 3.878. Keck Seng (M) Berhad 11,429,698 3.189. Hong Leong Finance Nominees Pte Ltd 6,497,000 1.80

10. Petaling Garden (S) Pte Ltd 4,573,800 1.2711. S L W Sdn Bhd 3,280,600 0.9112. Oversea Chinese Bank Nominees Pte Ltd 2,755,778 0.7613. DB Nominees (S) Pte Ltd 1,944,890 0.5414. Prudential Assurance Co Singapore (Pte) Ltd 1,472,000 0.41

– Prulink Fund15. Prudential Assurance Co Singapore (Pte) Ltd 1,302,000 0.36

– Life Fund16. Tan Kim Yeow Sendirian Berhad 1,000,000 0.2817. Su Lah Wah 683,080 0.1918. Tan Suat Ming Pauline 672,600 0.1919. Indosuez Singapore Nominees Pte Ltd 567,000 0.1620. BIL (Asia) Nominees Pte Ltd 474,100 0.13

(Others – Less than 474,100 shares each) 20,638,548 5.74

Total 359,659,981 100.00

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Substantial Shareholders

(as shown in the Register of Substantial Shareholders)a s a t 1 4 A p r i l 2 0 0 0

Beneficial DeemedName of Shareholders Shareholdings Shareholdings

1. Cobalt Limited 54,145,309 –

2. DBS Group Holdings Ltd – 60,182,000

3. DBS Land Limited – 60,182,000

4. The Development Bank of Singapore Ltd – 60,182,000

5. MND Holdings (Private) Limited – 60,182,000

6. Petaling Garden (S) Pte Ltd 27,689,791 –

7. Premier Health Holding Pte Ltd – 60,182,000

8. Premierhealth Investments Pte Ltd 60,182,000 –

9. Temasek Holdings (Private) Limited – 60,678,000

Analysis of Shareholdingsa s a t 1 4 A p r i l 2 0 0 0

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Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN that the Twenty-Seventh Annual General Meeting of theCompany will be held on Wednesday, 7 June 2000 at 11.00 a.m. at The Lecture Theatre,Level 3, Gleneagles Hospital, 6A Napier Road, Singapore 258500 for the purpose of transactingthe following businesses:

1. To receive and, if approved, to adopt the Directors’ Report and Accounts for the year ended31 December 1999 and the Auditors’ Report thereon.

2. To declare a Final Dividend of 8% per ordinary share of S$0.50 each less 25.5% income taxin respect of the year ended 31 December 1999.

3. (a) To re-elect Mr Anil Thadani, who retires pursuant to Article 83 of the Articles of Associationof the Company, as Director of the Company.

(b) To re-elect Mr Gordon Stavert Byrn Sr, who retires pursuant to Article 83 of the Articlesof Association of the Company, as Director of the Company.

(c) To re-elect Mr Sunil Chandiramani, who retires pursuant to Article 83 of the Articles ofAssociation of the Company, as Director of the Company.

(d) To re-elect Mr Ed Ng Ee Peng, who retires pursuant to Article 83 of the Articles ofAssociation of the Company, as Director of the Company.

(e) To re-elect Mr Goh Kee Song, who retires pursuant to Article 97 of the Articles ofAssociation of the Company, as Director of the Company.

(f) To re-elect Mr Chang See Hiang, who retires pursuant to Article 97 of the Articles ofAssociation of the Company, as Director of the Company.

4. To approve Directors’ Fees of $183,250 for 1999 (1998: $193,000).

5. To re-appoint Messrs. KPMG as Auditors and to authorise the Directors to fix theirremuneration.

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Notice of Annual General Meeting

6. As Special Business:

To consider and, if thought fit, to pass the following resolutions (a) and (b) as ordinary resolutions:

(a) That subject to Section 161 of the Companies Act, Cap 50, the Articles of Association ofthe Company and the approval of the relevant Stock Exchange and/or other governmentalor regulatory bodies where such approval is necessary, the Board of Directors of theCompany be and is hereby authorised, pursuant to Section 161 of the Companies Act,Cap 50, to issue shares in the Company (including but not limited to the issue of sharesin the capital of the Company at any time thereafter pursuant to an offer, agreement oroption made or granted by the Company while this authority remains in force) at anytime to such persons, upon such terms and conditions and for such purposes as theBoard of Directors may deem fit PROVIDED ALWAYS THAT the aggregate number ofshares to be issued pursuant to this Resolution does not exceed fifty per cent. of theissued share capital of the Company for the time being, of which the aggregate numberof shares issued other than on a pro rata basis to existing shareholders does not exceedtwenty per cent. of the Company’s existing share capital.

(b) That the Board of Directors of the Company be and is hereby authorised to issue andallot from time to time such number of shares in the capital of the Company as may berequired to be issued pursuant to the exercise of the options under the Parkway EmployeeShare Option Scheme (“Parkway Scheme”) PROVIDED ALWAYS THAT the aggregatenumber of the shares to be issued pursuant to the Parkway Scheme does not exceed fiveper cent. of the issued share capital of the Company from time to time.

7. To transact any other business which may normally be dealt with at an Annual General Meeting.

Dividend Payment Date

The Share Transfer Books and Register of Members of the Company will be closed from 19 June 2000to 20 June 2000 (both dates inclusive) to determine shareholders’ entitlement to the final dividend of8% less 25.5% income tax. The proposed final dividend, if approved at the Twenty-Seventh AnnualGeneral Meeting, will be paid on 30 June 2000.

By Order of the Board

June Tay Kwok FungGroup Corporate Secretary

Singapore, 12 May 2000

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Notes:

1. A member entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attendand vote instead of him.

2. Where a member appoints two proxies, the Company may treat the appointments as invalid unless the memberspecifies the proportion of his shareholding (expressed as a percentage of the whole) to be represented by each proxy.

3. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at 80 MarineParade Road, #22-01/09 Parkway Parade, Singapore 449269 not less than 48 hours before the time appointed forthe Annual General Meeting.

4. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney dulyauthorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must beexecuted either under its seal or under the hand of an officer or attorney duly authorised.

5. Mr Goh Kee Song, if re-elected, will remain as an independent member of the Audit Committee.

Explanatory Notes on special business to be transacted

6. (a) The ordinary resolution proposed in item 6(a) above, if passed, will empower the Board of Directors of theCompany, from the date of the above Meeting until the next Annual General Meeting, to issue shares in theCompany up to an amount not exceeding in total fifty per cent. (50%) of the issued share capital of the Companyfor the time being for such purposes as they consider would be in the interest of the Company. This authoritywill, unless revoked or varied at a general meeting, expire at the next Annual General Meeting of the Company.

6. (b) The ordinary resolution proposed in item 6(b) above, if passed, will enable the Board of Directors of the Company,from the date of the above meeting until the next Annual General Meeting, to issue shares in the Company up toan amount not exceeding in total five per cent. (5%) of the issued share capital of the Company for the time beingpursuant to the exercise of the options under the Parkway Employee Share Option Scheme. This authority will,unless revoked or varied at a general meeting, expire at the next Annual General Meeting of the Company.

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Proxy Form Parkway Holdings Limited(Incorporated in the Republic of Singapore)

I/We ____________________________________________________________________________________________________________________________

of _______________________________________________________________________________________________________________________________

being a Member(s) of Parkway Holdings Limited hereby appoint ___________________________________________________________

of ______________________________________________________________________________________________________________________________

or failing him, _________________________________________________________________________________________________________________

of _______________________________________________________________________________________________________________________________

as my/our proxy, to vote for me/us and on my/our behalf at the Twenty-Seventh Annual General Meeting of the

said Company to be held on Wednesday, 7 June 2000 and at any adjournment thereof:

* Please indicate your vote “For” or “Against” with a “✔ ” within the box provided.** If you wish to exercise all your votes “For” or “Against”, please indicate with a “✔ ” within the box provided.

Alternatively, please indicate the number of votes “For” or “Against” each resolution within the box provided.

If the Form of Proxy contains no indication as to how the proxy should vote in relation to each resolution, the proxywill vote as the proxy deems fit or abstain from voting.

As witness my/our hand(s)

this _____________ day of ________________ 2000

_________________________________________________(Signature or Common Seal of Member)

Number of Shares Held

By Show of Hands By Poll

No. Resolution For* Against* No. of Votes For** No. of Votes Against**

1. Adoption of Directors’ Report, Audited Accountsand Auditors’ Report.

2. Declaration of Final Dividend of 8% less tax.

3. Re-election of Director:a. Mr Anil Thadani

b. Mr Gordon Stavert Byrn Sr

c. Mr Sunil Chandiramani

d. Mr Ed Ng Ee Peng

e. Mr Goh Kee Song

f. Mr Chang See Hiang

4. Approval of Directors’ Fees for 1999.

5. Appointment of Auditors and fixing oftheir remuneration.

6. Special Business:a. Authority to issue and allot shares pursuant

to Section 161 of the Companies Act, Cap.50.

b. Authority to issue and allot shares pursuantto the exercise of options under the ParkwayEmployee Share Option Scheme.

7. Any Other Business.

✄

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Notes

1. Please insert the total number of Shares held by you. If you only have Shares entered against your name in the

Depository Register (as defined in Section 130A of the Companies Act), you should insert that number of Shares. If

you only have Shares registered in your name in the Register of Members, you should insert that number of Shares.

If you have Shares entered against your name in the Depository Register and Shares registered in your name in the

Register of Members, you should insert the aggregate number of Shares entered against your name in the Depository

Register and registered in your name in the Register of Members.

2. A member entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attend

and vote instead of him.

3. Where a member appoints two proxies, the Company may treat the appointments as invalid unless the member

specifies the proportion of his shareholding (expressed as a percentage of the whole) to be represented by each proxy.

4. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at 80 Marine

Parade Road, #22-01/09 Parkway Parade, Singapore 449269 not less than 48 hours before the time appointed for

the Annual General Meeting.

5. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly

authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be

executed either under its seal or under the hand of an officer or attorney duly authorised.

6. The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly

completed or illegible or where the true intentions of the appointor are not ascertainable from the instructions of the

appointor specified in the instrument appointing a proxy or proxies. In addition, in the case of members whose

Shares are entered against their names in the Depository Register, the Company may reject any instrument appointing

a proxy or proxies lodged if such members are not shown to have Shares entered against their names in the Depository

Register 48 hours before the time appointed for holding the Annual General Meeting as certified by The Central

Depository (Pte) Limited to the Company.

7. A corporation which is a member may authorise by resolution of its directors or other governing body such person

as it thinks fit to act as its representative at the Annual General Meeting in accordance with Section 179 of the

Companies Act. The representative attending the meeting must produce evidence of his authority.

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The Parkway Group Healthcare Network 2

Parkway Group Healthcare 3

Gleneagles Clinical Research Centre 6

Board of Directors 8

Medi-Rad Associates Ltd 10

A Message From The Managing Director 12

Parkway Laboratory Services 18

An Update On Parkway Group Healthcare 20

Corporate Information 24

Financial Statements 25

Summary of Major Properties 90

Comparative Figures for Financial Years 92

Analysis of Shareholdings 94

Notice of Annual General Meeting 96

Proxy Form 99

Contents

Project Consultant : Asia Business Channels Pte Ltd • Design & Production : AC Graphic Workshop Pte Ltd

Annual Report 1999Parkway Holdings Limited

Providing value to doctors

and their patients

through the delivery of

comprehensive health

services and consistent

quality care. We achieve

this through responsible

practices and continuous

investments in our people

and technology to meet the

challenges of tomorrow.

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