The Directors of CDL Investments New Zealand Limited are pleased to announce an unaudited operating profit after tax for the six months ended 30 June 2004 of $4,734,000, an increase of 28% from the corresponding period in the previous year. Total revenue decreased by 15 % to $12,461,000. A total of 77 sections were sold during the period under review, as compared to 163 during the same period last year.

The lift in net profit after tax was due to an increase in the proportion of highvalue, high-margin section sales from the company’s premium sites at Waimanu Bay, Redoubt Park and Ashmore. By comparison, earnings in the previous year were driven mainly by strong sales of mid-value, lower margin sections at Flagstaff and Ashmore.

Shareholders’ funds as at 30 June 2004 were $53.2 million (31 December 2003: $51.3 million) and total assets stood at $56.2 million (31 December 2003: $53.0 million). The net tangible asset value was 26.5 cents per ordinary share (31 December 2003: 25.7 cents).

Market Overview

Continuing on from a very strong 2003 financial year, the residential property market remained buoyant for the first half of the year. Strong demand coupled with consumer and business confidence in the local economy was evident and the company was able to capitalise on this with pleasing sales from the release of the final stage of high-value, mainly waterfront properties at Waimanu Bay.

Regional Breakdown

Due to the high volume of section sales recorded in 2003, the company started the year with relatively few titled or developed sections. For the first half of 2004, the Auckland market traded well with 58 section sales recorded from the developments at Waimanu Bay, Redoubt Park and Palmers Landing. A further 19 sales came from Ashmore in Hamilton.

Acquisitions

During the reporting period, CDL Land New Zealand Limited acquired a further 18.49 hectares of land comprising of: 12.43 hectares in Albany, Auckland; 4.04 hectares adjoining Flagstaff in Hamilton; and 2.02 hectares adjacent to the Northwood development site in Hastings. The acquisitions bring the total land portfolio to 254 hectares, replenishing it to levels seen in recent years. Going forward, CDL Land New Zealand Limited will continue to seek land investment and development opportunities in key growth areas to enhance future earnings.

Outlook

While CDL Land New Zealand Limited continues to report a good set of earnings for the reporting period, there are signs that the favourable market conditions that underpinned the performance may be slowing down. This may be read as a good sign for sustainable growth in the property market.

Furthermore, due to an unseasonably wet summer, the company has experienced considerable delays in completing the subdivisions presently underway in Auckland, Hamilton, Tauranga, Hastings and Queenstown. The company has over 200 new sites under development, most of which are expected to be released for sale later in the year.

The Board remains confident of the ongoing profitability of CDL Investments New Zealand Limited.