Announcement to ASX re Profit Guidance

Announcement to ASX re Profit Guidance

30-May-2003

The Board of Thakral Holdings Limited advises that it is currently forecasting the full year profit will be approximately 18% lower than that of last year. Included in last year’s result was a profit on sale of investment properties of $2.5 million. If this item is excluded the year’s result will be down by approximately 10%.

In announcing the half year results in February 2003, the Group advised that results for the second half of the financial year were forecast to be significantly ahead of the first half and the amount of the full year result would largely depend on the timing of three significant development projects and hotel occupancy not being seriously prejudiced by international events.

The Managing Director of Thakral Holdings Limited, Mr. John Hudson, said: “Whilst second half profit is expected to be 15% higher than the first half it will not reach the level that was projected because the Group’s hotel business has suffered from the combined effect of SARS and the war in Iraq together with a lower development contribution.”

Mr. Hudson said: “Our property development activities, particularly those in Queensland have performed very strongly and the three main projects at Broadbeach, Cairns and Palm Cove are now over 70% pre-sold with construction under way. These projects commenced construction later than expected and accordingly, the profit recognised on these will be lower than was anticipated in this current year. However, the reduced profit for the year is primarily a timing difference and a strong result from all three projects is confidently expected.”

The forecast is based upon adoption of the new UIG accounting guideline, which requires profit from development activities to be recognised on a percentage completion basis. In regard to the Broadbeach project, adoption of the new UIG guideline has meant that approximately $1.5 million profit has been included in the forecast which is less than 10% of the total expected profit from this development.

Looking beyond the current year and assuming a return to more normal trading conditions, particularly in the hotel sector, Management is expecting that the following year should show a solid improvement on the current year.

Please provide us with your confirmation of release announcement.

Yours faithfully,



Andrew Horne
Group Company Secretary

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