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NOTES TO CONDENSED INTERIM FINANCIAL REPORT (CONTINUED)
16 COMMITMENTS (CONTINUED)
(b) CAPITAL COMMITMENTS
UNAUDITED AUDITED
30 JUNE 31 DECEMBER
2012 2011
US$’000 US$’000
Contracted but not provided for:
Property, plant and equipment 32,025 14,713
Computer software and system development 21,743 11,729
Authorised but not contracted for:
Property, plant and equipment 64,545 74,072
Computer software and system development 15,216 38,791
17 RELATED PARTY TRANSACTIONS
133,529 139,305
Pursuant to the master agreement for leasing of properties that the Company entered into with FH (1937), the substantial
shareholder of the Company, on 13 January 2011, the Group leased certain properties from FH (1937) and its associates during
the period with aggregate rental paid of US$12,060,000 (2011: US$11,853,000).
On 19 January 2012, the Group entered into a sales and purchase agreement with LiFung Kids (Holdings) Limited (“LiFung Kids”),
a subsidiary of FH (1937), for its divestment of certain apparel retailing business at the initial consideration of US$17.8 million,
subject to upward or downward adjustment with reference to net tangible assets, provided that the total consideration will not
exceed US$26.7 million.
On the same date, the Group also entered into a new distribution and sale of goods agreement with FH (1937) to set out the
framework of the terms for distribution and sales of goods by the Group to the FH (1937) Group for a term of three years from 1
January 2012 to 31 December 2014. This new agreement replaces the original distribution and sale of goods agreement expiring
on 31 December 2012 and covers the scope of business contemplated under the Group’s agreement to engage LiFung Kids
as the Group’s exclusive retail distributor for certain branded children’s apparel, children’s footwear and various other related
products in Hong Kong, the PRC and Macau. Based on these distribution and sale of goods agreements, the Group recorded
sales of US$5,685,000 (2011: US$980,000) for the interim period.
The foregoing related party transactions also fall under the definition of continuing connected transactions of the Company as
stipulated in the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited.
Save as above, the Group had no material related party transactions during the period.
LI & FUNG LIMITED | INTERIM REPORT 2012
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