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To: Business Editor 1st August 2001For immediate release

The following announcement was today issued to the London Stock Exchange.

Jardine Matheson Holdings LimitedInterim Report 2001

Highlights

Underlying earnings per share increases 45% to US¢20.62* Jardine Motors’ UK operations return to profit Dairy Farm refocuses on profitable Asian operations Hongkong Land expands property development portfolio Asian business climate continues to deteriorate

“We expect to report growth in earnings per share for the full year despite the effects of the global economic slowdown on many of our businesses.

Our ability to combine sound financing with the delivery of long-term value to shareholders has been well demonstrated, with our net asset value in US Dollars increasing by on average 18% compound per annum over the past ten years.”

Henry Keswick, Chairman1st August 2001

* The Group’s financial statements are prepared under International Accounting Standards (‘IAS’) which, following recent changes, no longer permit leasehold interests in land to be carried at valuation. This treatment does not reflect the generally accepted accounting practice in the territories in which the Group has significant leasehold interests, nor how management measures the performance of the Group. Accordingly, the Group has presented supplementary financial information prepared in accordance with IAS as modified by the revaluation of leasehold properties in addition to the IAS financial statements. The figures included in the highlights above, the Chairman’s Statement and Operating Review are based on this supplementary financial information.

The interim dividend of US¢7.80 per share will be payable on 17th October 2001 to shareholders on the register of members at the close of business on 24th August 2001 and will be available in cash with a scrip alternative. The ex-dividend date will be on 22nd August 2001, and the share registers will be closed from 27th to 31st August 2001, inclusive.

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Jardine Matheson Holdings LimitedInterim Report 2001

Performance Jardine Matheson Holdings Limited today announced that the trading environment was more uncertain in the first half of the year as the Group’s primary Asian markets were impacted by the slowdown in the global economy. Nevertheless, underlying earnings per share increased by 45% to US¢20.62 due to improved performances from a number of the Group’s major businesses and the benefits of the share tender offer that took place last September. Further investment in Group companies’ shares also had a positive impact on earnings.

The difficult economic climate had a restraining effect on the recovery in Mandarin Oriental’s earnings and contributed to the weaker results from the Jardine Pacific businesses. Jardine Lloyd Thompson, Hongkong Land, Jardine Motors Group and Dairy Farm all performed up to expectation.

Two businesses that have been the subject of particular management attention have made good progress. Jardine Motors Group’s operations in the United Kingdom have returned to profit following last year’s extensive restructuring. At Dairy Farm, the decision was taken to exit its Australian supermarket business and the disposal programme, as agreed with the local competition regulator, is well under way, while its Hong Kong supermarket business is also recovering, albeit slowly.

Underlying net profit for the period was US$81 million, compared with US$86 million for the same period in 2000. This reduction was primarily due to increased interest costs arising from debt incurred to finance share purchases. Charges have been made in respect of the costs associated with Dairy Farm’s sale of its Australian operations and the writing-off of the carrying value of the investment in Astra International held through Cycle & Carriage. These charges were offset in part by the profit on the sale of non-core investments.

An unchanged interim dividend of US¢7.80 per share has been declared.

Business DevelopmentsTurning to business developments, the Chairman, Henry Keswick, said that Hongkong Land’s latest property development in Hong Kong, 11 Chater Road, will be completed in the middle of next year, with over 50% of the retail portion already pre-let to the Armani group. Discussions are also under way with a number of potential anchor office tenants. Following Hongkong Land’s successful completion of its Singapore property last year, the company has, in joint venture with Cheung Kong and Keppel Land, won the first site to be tendered on the Marina South development in the city. This new development of over 1.5 million square feet of office and retail space is expected to be completed in 2005/6.

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In line with Mandarin Oriental’s expansion strategy for its global brand, plans were announced for a luxury hotel in Tokyo as part of a new building complex to be developed by Mitsui Fudosan Co.

Following the decision to exit its Australian supermarket business and to focus on its core retailing strengths in Asia, Dairy Farm is reviewing the strategies for its profitable New Zealand operation, for which it has received approaches from a number of possible purchasers. The group is successfully developing its businesses in Southeast Asia, and is expanding its convenience store network in Southern China.

Cycle & Carriage’s associate, Astra International, produced a strong trading performance, though its results were again adversely affected by its heavy foreign currency debt exposure. In view of the weakness in the Indonesian Rupiah, the Company has provided against the whole of its share of this investment.

The value in Group company shares continues to be recognised. The Company has made further purchases of its own shares, and has increased its holding in Jardine Strategic to 75%. Jardine Strategic has also increased its shareholdings in Hongkong Land, Dairy Farm, Mandarin Oriental and Cycle & Carriage. Such purchases will benefit shareholders by enhancing earnings and net asset value per share, while at the same time creating greater focus within the Group.

Looking AheadIn conclusion, Henry Keswick said, "The Company’s ability to combine sound financing with the delivery of long-term value to shareholders has been well demonstrated over recent years with net asset value in US Dollars increasing by on average 18% compound per annum over the past ten years. This has been achieved in no small part by our strategy of consolidating both our investment and our management focus on our core businesses. We expect to report growth in earnings per share for the full year despite the effects of the global economic slowdown on many of our businesses."

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Operating Review

Jardine PacificJardine Pacific generated a profit of US$33 million in the first half, 27% down on the previous year as the more difficult trading environment affected a number of its businesses. Seasonal factors should produce an improved contribution in the second half, but the results will inevitably be held back by prevailing market conditions.

Gammon’s order book improved since the year-end, but margins are under increasing pressure. Jardine Schindler’s order backlog is down, although its maintenance portfolio has risen, and it has been decided to cease the manufacture of elevators in Malaysia. Most of Jardine Engineering’s businesses performed steadily, but the sale of Chubb last year and lower contributions from the contracting and distribution businesses have led to reduced earnings for the six months.

HACTL was affected by the 8% reduction in cargo through-put, and the results of Jardine Aviation Services, while benefiting from new clients, continued to be held back by losses in Australia. Jardine Shipping Services also suffered from falling cargo volumes, as well as increased capacity in Asia, a trend that is likely to continue for the remainder of the year.

Jardine OneSolution is facing a very difficult technology market with demand well down on last year. A joint venture was formed with Telus International of Canada, which has taken a 25% stake in JOS Synergy, the consulting and outsourcing business. IKEA sales grew modestly, as an excellent performance in Hong Kong compensated for the poor retail environment in Taiwan. Like for like sales at Pizza Hut were up, but Jardine Restaurants’ earnings were impacted by a weak performance by Olivers’ and the start-up costs of an institutional catering business.

Pacific Finance improved its profitability in the face of aggressive competition, while net income from Jardine Property Investments’ property portfolio remained steady. Elsewhere, Colliers Jardine and Jardine Logistics experienced weakening markets, and declining spirits sales in Japan impacted Wines & Spirits. Central overheads have remained steady, as have central finance costs due to the lower interest rates offsetting the effects of higher debt levels.

Jardine Motors GroupJardine Motors Group achieved an underlying net profit of US$29 million for the first half, an increase of 24% compared to the same period last year. Overall results for the full year are expected to show a substantial improvement over last year. The major improvement in the performance came from the United Kingdom. Benefiting from the disposal last year of several loss making dealerships and a wide ranging rationalisation programme, a refocused management has significantly enhanced results.

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In Hong Kong, passenger car registrations declined slightly in the period, but Zung Fu maintained its market share and, despite tough competition with grey market operators, produced a result only a little lower than last year. In Mainland China, profitability rose due to higher deliveries from the group’s associate Southern Star and to better results from Zung Fu’s service centres. Both in France and the United States profits were lower due to the more difficult trading conditions and start up losses on certain new initiatives.

Jardine Lloyd ThompsonJardine Lloyd Thompson continued its rapid expansion, generating brokerage and fees of £173 million for the six months, an increase of 26%. This growth was attributable to a combination of acquisitions, new business development, firmer insurance markets and exchange rate movements. Pre-tax profit excluding exceptional items and goodwill amortisation rose 18% to £42 million.

In JLT Risk Solutions turnover increased by 17%, primarily from more traditional areas. There were excellent performances by Cargo, Casualty, Accident & Health, Construction, Energy, North American Property and all Reinsurance areas. Growth in the Alternative Risk Transfer business slowed, but it remains an area of high potential. Capital Risk Group and Captive Management, two initiatives which were announced last year, are now operational and are expected to make positive contributions in the second half. In JLT Corporate Risks & Services, turnover increased by 34%. Strong performances were achieved in the United Kingdom, Asia and Australia, and SIACI again did well. The integration of Abbey National Benefit Consultants, the pension administration business acquired at the end of last year, is proceeding well.

Jardine StrategicJardine Strategic’s underlying earnings per share showed significant growth in the first six months, increasing 50% to US¢8.77. The strong increase reflected a much improved performance from Dairy Farm, investment in Group company shares and the repurchase of shares by both Jardine Matheson and Hongkong Land in 2000. Net asset value per share, based on the market price of the Company’s holdings at 30th June 2001 was US$4.92. Although modestly down in the six months, it represents a 29% increase over the value of US$3.81 at 30th June 2000.

Jardine Strategic consolidated its shareholdings in its core businesses, recognizing the value to earnings and net asset value per share. Its attributable interest in Hongkong Land is now 38%, in Dairy Farm 61%, in Mandarin Oriental 64% and Cycle & Carriage 27%. The company sold its non-core 5% shareholding in Housing Development Finance Corporation, producing a profit of US$27 million.

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Dairy FarmDairy Farm’s continuing operations returned to profit in the first half of 2001, with a modest net profit of US$12 million. There was some improvement in its Hong Kong supermarket business, although the pace of recovery is being constrained by a difficult trading environment. There were strong performances from Dairy Farm’s other operations in South Asia, North Asia and New Zealand.

In April the group concluded that further investment in its Australian operation would not benefit shareholders. In view of the regulatory constraints relating to competition, it was determined that the most effective way of realizing value was to exit the market through a managed sell-down process. Agreements to sell 156 of the 287 stores have already been concluded, and sales of the majority of the remaining stores are expected by the year end.

Dairy Farm’s South Asian businesses are expanding, building on the progress made in 2000. The growth is being driven by Giant, to which significant investment is being committed to develop a network of hypermarkets in Malaysia. Woolworths New Zealand again performed well, with profit growth of 21% in local currency terms. Approaches have been made to acquire Woolworths, although no decision to sell has been taken and Dairy Farm is reviewing its options. The group’s 7-Eleven franchise in Southern China has received approval in principle from the regulatory authorities to expand to up to 350 stores in Guangdong.

Hongkong LandHongkong Land produced a profit of US$114 million for the six months, little changed from the first half of 2000. An improvement in net rental income was broadly offset by increased financing charges due to its higher level of debt. Two major refinancings were undertaken which have broadened the group’s sources of debt and lengthened maturities.

Following the sharp recovery in the office market in Hong Kong in 2000, rents stabilized in the first half of 2001 as sentiment weakened in light of the more difficult economic environment. Despite this, occupancy in premium grade buildings in the Central business district remained high with no new supply coming available during the year. Rental reversions in the company’s Central portfolio have begun to turn positive, but are unlikely to enhance earnings materially in the short term.

More than half of the retail portion of Hongkong Land’s new building in the heart of Central at 11 Chater Road has been pre-let to the Armani group, while discussions are under way with a number of potential anchor tenants for the office portion. In Singapore, following the successful completion and letting of One Raffles Link last year, Hongkong Land has, in joint venture with Cheung Kong and Keppel Land, won the first site to be tendered on the Marina South development in the city.

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Mandarin OrientalWhile current economic conditions are challenging in many of the markets in which Mandarin Oriental operates, its strategy of developing one of the world’s leading luxury hotel brands remains on track.

Mandarin Oriental’s results for the six months benefited from the reopening of its London hotel and the addition of the Rafael hotels acquired in May 2000. However, economic uncertainty had a negative impact on occupancy levels in Hong Kong, New York and London. There were good performances from its associates, particularly in Geneva and Macau. The improved operating performance was offset by higher interest charges, largely attributable to the issue of convertible bonds in 2000 to finance the Rafael acquisition, giving a net profit for the period of US$6 million, compared with US$3 million in 2000.

In June, the group entered into an agreement to manage a new 171 room luxury hotel in Tokyo due to open in late 2006. The Oriental, Bangkok, which continues to outperform its competition, has commenced the final phase of its US$30 million self-financed rooms renovation programme which will be completed at the end of September. This will ensure that the hotel remains a key flagship property.

Cycle & CarriageCycle & Carriage’s trading performance for the half year suffered from a deterioration in its motor activities due to weakness in the group’s principal markets. Margins were also reduced in Singapore following the loss of the Mercedes-Benz distribution rights from 1st January 2001, although the full effect was mitigated by the sale of vehicles from the dealership’s existing stocks on which a distributor’s margin was still earned. Property earnings declined due to the lower number of projects under development. Astra International produced an increased contribution due to inclusion of a full six months results to 31st May 2001, but its trading performance was impacted by the effect on margins of the decline in the Indonesian Rupiah.

A net profit of S$26 million, a 33% increase on the previous year, was made for the half year after accounting for non-recurring items. The major non-recurring items were a gain on the sale of 50% of the Australian Audi distribution activity to Audi AG, which was more than offset by the foreign exchange losses on the Astra International foreign debt. The group’s share of Astra International’s net loss was, however, restricted as the carrying value of the investment in Astra International was reduced to zero. The trading environment is expected to remain difficult for the balance of the year.

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Jardine Matheson Holdings Limited Consolidated Profit and Loss Account

Prepared in accordance with IAS

Prepared in accordance with IAS asmodified by revaluation of leasehold

properties (refer note 1)Year ended

31stDecember

Six months ended30th June


Year ended31st

December2000 2000 2001 2001 2000 2000

US$m US$m US$m Note US$m US$m US$m

10,362 5,276 4,958 2 Revenue 4,958 5,276 10,362(7,820) (4,024) (3,752) Cost of sales (3,751) (4,024) (7,819)

2,542 1,252 1,206 Gross profit 1,207 1,252 2,543154 95 91 Other operating income 91 95 130

(1,829) (926) (872) Selling and distribution costs (872) (926) (1,829)(612) (305) (282) Administration expenses (282) (305) (611)(127) (25) (23) Other operating expenses (23) (24) (137)834 - - Profit on sale of Robert Fleming - - 834

(129) - - Impairment of assets in Dairy Farm - - (129)

833 91 120 3 Operating profit 121 92 801(106) (43) (79) Net financing charges (79) (43) (106)

338 182 119

Share of operating profit less net financing charges of associates andjoint ventures 126 187 351

- - (88) Impairment of assets in Cycle & Carriage (88) - -Fair value gains on investment properties

- - - in Hongkong Land - - 701

338 182 314 Share of results of associates and joint

ventures 38 187 1,052

1,065 230 72 Profit before tax 80 236 1,747(113) (59) (47) 5 Tax (46) (59) (111)

952 171 25 Profit after tax 34 177 1,636(19) 5 14 Outside interests 12 3 (194)

933 176 39 Net profit 46 180 1,442

US¢ US¢ US¢ US¢ US¢ US¢

6 Earnings per share 168.57 28.98 10.05 - basic 11.69 29.62 260.44168.05 28.96 10.02 - diluted 11.64 29.60 259.64

6 Underlying earnings per share 30.13 13.57 18.98 - basic 20.62 14.21 31.9530.04 13.56 18.91 - diluted 20.54 14.20 31.86

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Jardine Matheson Holdings LimitedConsolidated Balance Sheet


Prepared in accordance with IAS as modified by revaluation of leasehold

properties (refer note 1)

At 31st December At 30th June At 30th June

At 31stDecember

2000US$m

2000

US$m

2001US$m

2001US$m

2000US$m

2000US$m

Net operating assets51 106 33 Goodwill 33 106 51

1,618 1,786 1,533 Tangible assets 2,347 2,551 2,43519 20 18 Investment properties 176 189 176

432 387 441 Leasehold land payments - - -2,055 2,274 2,027 Associates and joint ventures 3,368 3,005 3,404

976 424 1,017 Other investments 1,017 424 97631 21 33 Deferred tax assets 33 21 3186 83 87 Pension assets 87 83 86

5,268 5,101 5,189 Non-current assets 7,061 6,379 7,159

972 955 875 Stocks and work in progress 875 955 972812 857 657 Debtors and prepayments 657 857 812

1,376 1,349 927 Bank balances and other liquid funds 927 1,349 1,376

3,160 3,161 2,459 Current assets 2,459 3,161 3,160

(2,129) (2,100) (1,675) Creditors and accruals (1,675) (2,100) (2,129)(384) (604) (691) Borrowings (691) (604) (384)

(33) (30) (36) Current tax liabilities (36) (30) (33)(42) (44) (39) Provisions (39) (44) (42)

(2,588) (2,778) (2,441) Current liabilities (2,441) (2,778) (2,588)

572 383 18 Net current assets 18 383 572(2,742) (1,683) (2,082) Long-term borrowings (2,082) (1,683) (2,742)

(70) (64) (69) Deferred tax liabilities (75) (71) (76)(13) (13) (13) Pension liabilities (13) (13) (13)(81) (10) (80) Other non-current liabilities (80) (10) (81)

2,934 3,714 2,963 4,829 4,985 4,819

Capital employed156 199 155 Share capital 155 199 156

- 273 -Share premium and contributed

surplus - 273 -2,619 2,515 2,595 Revenue and other reserves 3,784 3,155 3,802(630) (566) (638) Own shares held (638) (566) (630)

2,145 2,421 2,112 Shareholders’ funds 3,301 3,061 3,328789 1,293 851 Outside interests 1,528 1,924 1,491

2,934 3,714 2,963 4,829 4,985 4,819

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Jardine Matheson Holdings Limited Consolidated Statement of Changes in Shareholders’ Funds



properties (refer note 1)Year ended

31stDecember



Year ended31st

December2000 2000 2001 2001 2000 2000

US$m US$m US$m Note US$m US$m US$m

At beginning of period3,106 3,106 3,328 - as previously reported 3,328 3,106 3,106(639) (639) (1,183) - effect of adopting IAS 40 - - -

2,467 2,467 2,145 3,328 3,106 3,106- - 141 - effect of adopting IAS 39 141 - -

2,467 2,467 2,286 - as restated 3,469 3,106 3,106

Revaluation of properties6 - - - net revaluation surplus - - 45

(1) 1 - - deferred tax - 1 (1)Revaluation of other investments

- - (48) - fair value losses (48) - -- transfer to profit and loss account on

- - (9) disposal (9) - -Net exchange translation differences

(82) (42) (55) - amount arising in period (56) (45) (86)- transfer to profit and loss account on

56 - - disposal of businesses - - 56Cash flow hedges

- - (12) - fair value losses (12) - -- - 1 - transfer to profit and loss account 1 - -- - 1 - deferred tax 1 - -1 1 - Other - 1 1

Net (losses)/gains not recognised in (20) (40) (122) profit and loss account (123) (43) 15933 176 39 Net profit 46 180 1,442

(137) (104) (73) 7 Dividends (73) (104) (137)1 - 1 Exercise of share options 1 - 1

104 71 20 Scrip issued in lieu of dividends 20 71 104(1,065) (72) (31) Repurchase of shares (31) (72) (1,065)

2 - - Change in attributable interests - - 2(140) (77) (8) Increase in own shares held (8) (77) (140)

2,145 2,421 2,112 At end of period 3,301 3,061 3,328

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Jardine Matheson Holdings Limited Consolidated Cash Flow Statement




Year ended 31st

DecemberSix months ended

30th JuneSix months ended

30th June

Year ended31st

December2000

US$m2000

US$m2001

US$m Note2001

US$m2000

US$m2000

US$m

Operating activities

833 91 120 Operating profit 121 92 801219 121 102 Depreciation and amortisation 101 120 243

(701) (57) (52) Other non-cash items (52) (57) (693)3 (44) (119) (Increase)/decrease in working capital (119) (44) 3

69 44 34 Interest received 34 44 69(161) (85) (105) Interest and other financing charges paid (105) (85) (161)

(41) (17) (22) Tax paid (22) (17) (41)

221 53 (42) (42) 53 221

210 109 104Dividends from associates and joint ventures 104 109 210

431 162 62 Cash flows from operating activities 62 162 431

Investing activities

(1,010) (307) (67) 8(a) Purchase of subsidiary undertakings (67) (307) (1,010)(92) (54) (66) 8(b) Purchase of associates and joint ventures (66) (54) (92)(18) (11) (14) Purchase of other investments (14) (11) (18)

(319) (153) (86) Purchase of tangible assets (86) (153) (319)35 (11) (180) 8(c) Sale of subsidiary undertakings (180) (11) 35

749 106 1 8(d) Sale of associates and joint ventures 1 106 7494 1 198 8(e) Sale of other investments 198 1 4

28 16 32 Sale of tangible assets 32 16 28

(623) (413) (182) Cash flows from investing activities (182) (413) (623)

Financing activities

1 - 1 Issue of shares 1 - 1(992) (60) (15) Repurchase of shares (15) (60) (992)

16 16 4Capital contribution from outside shareholders 4 16 16

4,075 1,129 2,039 Drawdown of borrowings 2,039 1,129 4,075(2,922) (947) (2,275) Repayment of borrowings (2,275) (947) (2,922)

(78) (64) (38) Dividends paid by the Company (38) (64) (78)(104) (82) (30) Dividends paid to outside shareholders (30) (82) (104)

(4) (8) (314) Cash flows from financing activities (314) (8) (4)(35) (28) (14) Effect of exchange rate changes (14) (28) (35)

(231) (287) (448)Net decrease in cash and cash

equivalents (448) (287) (231)Cash and cash equivalents at

1,549 1,549 1,318 beginning of period 1,318 1,549 1,549Cash and cash equivalents at end of

1,318 1,262 870 period 870 1,262 1,318

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Jardine Matheson Holdings Limited Analysis of Profit Contribution




Year ended31st

DecemberSix months ended

30th JuneSix months ended

30th June

Year ended31st

December2000

US$m2000

US$m2001

US$m2001

US$m2000

US$m2000

US$m

Group Contribution

92 44 32 Jardine Pacific 33 45 9321 18 30 Jardine Motors Group 30 18 2119 11 12 Jardine Lloyd Thompson 12 11 19

2 (8) 5 Dairy Farm 6 (8) 350 24 30 Hongkong Land 35 27 57

8 2 6 Mandarin Oriental 6 2 97 1 1 Cycle & Carriage 1 1 7

199 92 116 Profit from core businesses 123 96 209(32) (10) (42) Corporate and other interests (42) (10) (32)

167 82 74 Underlying net profit 81 86 177766 94 (35) Non-recurring items (35) 94 1,265

933 176 39 Net profit 46 180 1,442

Further analysis of Jardine Pacific

15 6 4 Gammon Construction 4 6 1516 6 6 HACTL 6 6 16

6 2 2 IKEA 2 2 64 2 3 Jardine Aviation Services 3 2 4

15 7 4 Jardine Engineering Corporation 4 7 158 4 3 Jardine OneSolution 3 4 85 2 2 Jardine Property Investment 3 3 68 5 4 Jardine Restaurants 4 5 88 5 6 Jardine Schindler 6 5 87 4 2 Jardine Shipping Services 2 4 74 2 2 Pacific Finance 2 2 47 5 - Other businesses - 5 7

103 50 38 39 51 104(11) (6) (6) Corporate (6) (6) (11)

92 44 32 33 45 93

Further analysis of Jardine Motors Group

51 25 25 Hong Kong and Mainland China 25 25 51(30) (7) 4 United Kingdom 4 (7) (30)

4 3 1 France 1 3 41 2 - United States - 2 1

26 23 30 30 23 26- 1 (1) Corporate and other interests (1) 1 -

26 24 29 29 24 26Attributable to outside interests and

(5) (6) 1 amortisation of goodwill 1 (6) (5)

21 18 30 30 18 21

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Jardine Matheson Holdings Limited Notes

1. Accounting Policies and Basis of Preparation

The unaudited interim condensed financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting. The Group has presented supplementary financial information prepared in accordance with IAS as modified by the revaluation of leasehold properties in addition to the IAS financial statements.

Other than described below, there have been no changes to the accounting policies described in the 2000 annual financial statements.

(a) Financial statements prepared in accordance with IAS

In 2001, the Group adopted IAS 39 Financial Instruments: Recognition and Measurement and IAS 40 Investment Property.

In accordance with IAS 39, non-current investments and derivatives are recognised on the balance sheet at fair value. Unrealised gains and losses arising from changes in the fair value of non-current investments are taken to reserves until realised. This is a change in accounting policy as in previous years non-current investments were stated on the balance sheet at cost less amounts provided and derivatives were recognised only to the extent of premiums paid or received on options. The effect of this change has been to increase shareholders' funds at 1st January 2001 by US$141 million.

In accordance with IAS 40 and as a result of an inability to estimate reliably the element of leasehold property values attributable to the building component, leasehold land and buildings which are investment properties are carried at depreciated historical cost. Similarly leasehold interests in land in respect of other leasehold properties are carried at amortised cost. This is a change in accounting policy as in previous years the Group had reflected the fair value of leasehold properties in the financial statements and recorded fair value changes in property revaluation reserves. The effect of this change has been to decrease net profit for the six months ended 30th June 2000 by US$4 million and to increase net profit for the year ended 31st December 2000 by US$2 million, and to decrease shareholders' funds at 1st January 2000 and 2001 by US$639 million and US$1,183 million respectively.

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1. Accounting Policies and Basis of Preparation (continued)

(b) Financial information prepared in accordance with IAS as modified by revaluation of leasehold properties

As described above, in prior years the Group reflected the fair value of leasehold properties on its financial statements. Changes in IAS, which came into effect during 2001, no longer permit the valuation of leasehold interests in land. As a result, the Group is required to revert to accounting for leasehold land in respect of investment and other properties at amortised cost in order to comply with IAS. This treatment does not reflect the generally accepted accounting practice in the territories in which the Group has significant leasehold interests, nor how management measures the performance of the Group. Accordingly, the Group has presented supplementary financial information on pages 8 to 12 prepared in accordance with IAS as modified by the revaluation of leasehold properties. In accordance with IAS 40, changes in fair values of investment properties which were previously taken directly to property revaluation reserves are recorded in the consolidated profit and loss account. The effect of this change has been to increase net profit for the year ended 31st December 2000 by US$511 million. There is no impact on net profit for the six months ended 30th June 2000.

The Group’s reportable segments are set out in note 2 and are described on pages 4 to 7.

2. RevenuePrepared in accordance with IAS

Six months ended 30th June2001

US$m2000

US$m

By business:Jardine Pacific 879 827Jardine Motors Group 1,295 1,399Dairy Farm 2,664 2,926Mandarin Oriental 118 94Other activities 2 30

4,958 5,276

3. Operating ProfitPrepared in accordance with IAS


US$m2000

US$m

By business:Jardine Pacific 21 89Jardine Motors Group 43 37Dairy Farm (6) (46)Mandarin Oriental 20 13

78 93Corporate and other interests 42 (2)

120 91

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4. Share of Results of Associates and Joint VenturesPrepared in accordance with IAS


US$m2000

US$m

By business:Jardine Pacific 30 38Jardine Motors Group 3 (3)Jardine Lloyd Thompson 17 19Robert Fleming - 62Dairy Farm 12 15Hongkong Land 46 44Mandarin Oriental 5 3Cycle & Carriage 6 4

119 182Impairment of assets in Cycle & Carriage (88) -

31 182

5. TaxPrepared in accordance with IAS


US$m2000

US$m

Company and subsidiary undertakings 23 17Associates and joint ventures 24 42

47 59

Tax on profits has been calculated at rates of taxation prevailing in the territories in which the Group operates and includes United Kingdom tax of US$6 million (2000: US$5 million).

6. Earnings per Share

Basic earnings per share are calculated on net profit of US$39 million (2000: US$176 million) and on the weighted average number of 392 million (2000: 609 million) shares in issue during the period. The weighted average number excludes the Company’s share of the shares held by subsidiary undertakings and the shares held by the Trustee under the Senior Executive Share Incentive Schemes.

Diluted earnings per share are calculated on the weighted average number of 393 million (2000: 609 million) shares after adjusting for the number of shares which are deemed to be issued for no consideration under the Senior Executive Share Incentive Schemes based on the average share price during the period.

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6. Earnings per Share (continued)

Additional basic and diluted earnings per share reflecting the revaluation of leasehold properties are calculated on net profit of US$46 million (2000: US$180 million) as shown in the supplementary financial information. The difference between net profit as shown in the financial statements and net profit as shown in the supplementary financial information is reconciled as follows:


US$m2000

US$m

Net profit as shown in financial statements 39 176Amortisation of leasehold land payments 1 1Depreciation of investment properties in Hongkong Land 5 3Other 1 -

Net profit as shown in supplementary financial information 46 180

Additional basic and diluted earnings per share are also calculated based on underlying earnings which are calculated as follows:

Prepared in accordance withIAS as modified by revaluation

Prepared in accordance with IAS of leasehold properties

Six months ended 30th June Six months ended 30th June2001

US$m2000

US$m2001

US$m2000

US$m

Net profit 39 176 46 180Businesses disposed of

- Chubb China - (58) - (58)- Robert Fleming - (41) - (41)- Franklins 20 10 20 10- other (9) (12) (9) (12)

11 (101) 11 (101)Impairment of assets

- Astra International 65 - 65 -- other - 5 - 5

65 5 65 5Fair value gain on conversion

option component of guaranteedbonds (19) - (19) -

Sale of investments (22) - (22) -Onerous leases and lease exit

costs - 2 - 2

Underlying net profit 74 82 81 86

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7. DividendsPrepared in accordance with IAS


US$m2000

US$m

Final dividend in respect of 2000 of US¢18.70 (1999: US¢17.20) per share 116 137

Less Company’s share of dividends paid on the sharesheld by subsidiary undertakings (43) (33)

73 104

An interim dividend in respect of 2001 of US¢7.80 (2000: US¢7.80) per share amounting to a total of US$48 million (2000: US$62 million) is declared by the Board. The net amount after deducting the Company’s share of the dividends payable on the shares held by subsidiary undertakings of US$18 million (2000: US$16 million) will be accounted for as an appropriation of revenue reserves in the year ending 31st December 2001.

8. Notes to Consolidated Cash Flow StatementPrepared in accordance with IAS

Six months ended 30th June

(a) Purchase of subsidiary undertakings2001

US$m2000

US$m

Tangible assets 4 102Associates and joint ventures - 22Other investments - 21Current assets 17 30Current liabilities (20) (19)Long-term borrowings - (31)

Fair value at acquisition 1 125Goodwill attributable to subsidiary undertakings - 45

Total consideration 1 170Adjustment for deferred consideration and carrying value of associates and joint ventures (1) (8)Cash and cash equivalents of subsidiary undertakings acquired - (11)

Net cash outflow - 151Payment of deferred consideration 10 8Purchase of shares in Jardine Strategic 30 138Purchase of shares in Dairy Farm 14 2Purchase of shares in Mandarin Oriental 13 8

67 307

Net cash outflow in 2000 of US$151 million included Mandarin Oriental’s acquisition of The Rafael Group of US$135 million.

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8. Notes to Consolidated Cash Flow Statement (continued)

(b) Purchase of associates and joint ventures included Jardine Strategic’s increased interest in Hongkong Land of US$50 million (2000: US$38 million).

Prepared in accordance with IASSix months ended 30th June

(c) Sale of subsidiary undertakings2001

US$m2000

US$m

Tangible assets 4 19Pension assets - 2Current assets 381 50Current liabilities (317) (44)Long-term borrowings - (14)Pension liabilities - (1)Outside interests (1) (7)

Net assets disposed of 67 5Profit on disposal 20 8

Sale proceeds 87 13Adjustment for deferred consideration (1) -Cash and cash equivalents of subsidiary undertakings disposed of (254) (24)

Net cash outflow (168) (11)Closure and related costs of Dairy Farm’s Australian operation (12) -

(180) (11)

Net cash outflow in 2001 of US$168 million included a cash outflow of US$218 million relating to the disposal of Matheson Bank in the United Kingdom and a cash inflow of US$50 million relating to Dairy Farm’s sale of Sims Trading.

(d) Sale of associates and joint ventures in 2000 included Jardine Pacific’s interest in Chubb China of US$70 million.

(e) Sale of other investments in 2001 included Jardine Strategic’s interests in Housing Development Finance Corporation of US$70 million and J.P. Morgan Chase of US$119 million.

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9. Capital Commitments and Contingent Liabilities At 31st

At 30th June December2001

US$m2000

US$m2000

US$m

(a) Capital commitments 144 126 82

(b) Contingent liabilities- guarantees in respect of facilities

made available to associates andjoint ventures 103 66 104

- other guarantees 5 50 5

Various Group companies are involved in litigation arising in the ordinary course of their respective businesses. Having reviewed outstanding claims and taking into account legal advice received, the Directors are of the opinion that adequate provisions have been made in the financial statements.

10. Interim Report

The Interim Report will be posted to shareholders on or about 22nd August 2001. Copies may be obtained from Jardine Matheson International Services Limited, P.O. Box HM 1068, Hamilton HM EX, Bermuda; Capita IRG Plc, Bourne House, 34 Beckenham Road, Beckenham, Kent BR3 4TU, England and M & C Services Private Limited, 138 Robinson Road #17-00, Hong Leong Centre, Singapore 068906.

The interim dividend of US¢7.80 per share will be payable on 17th October 2001 to shareholders on the register of members at the close of business on 24th August 2001, and will be available in cash with a scrip alternative. The ex-dividend date will be on 22nd August 2001, and the share registers will be closed from 27th to 31st August 2001, inclusive. Shareholders will receive their cash dividends in United States Dollars, unless they are registered on the Jersey branch register where they will have the option to elect for Sterling. These shareholders may make new currency elections by notifying the United Kingdom transfer agent in writing by 27th September 2001. The Sterling equivalent of dividends declared in United States Dollars will be calculated by reference to a rate prevailing ten business days prior to the payment date. Shareholders holding their shares through The Central Depository (Pte) Limited (‘CDP’) in Singapore will receive United States Dollars unless they elect, through CDP, to receive Singapore Dollars or the scrip alternative.

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For further information, please contact:

Jardine Matheson LimitedNorman Lyle (852) 2843 8216

Golin/Harris ForrestSue Gourlay (852) 2501 7936

This and other Group announcements can be accessed through the Internet at “www.jardines.com”.

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http://www.jardines.com/

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