Exhibit 7.3

 

MTR Corporation Limited

 

Computation of

Ratio of Earnings to Fixed Charges

Based on Hong Kong GAAP

(Expressed in millions of HK$)

 

          As of December 31
          1998
    1999
    2000
    2001(1)
    2002

Profit before tax

         2,819    2,116    4,055    4,278    4,213
         
  
  
  
  

Fixed Charges:

                              

Interest expenses

         1,123    1,680    1,942    1,870    1,748

Amortization of debt discount or deferred debt costs

         26    32    46    53    23

Representative portion of interest in operating lease expenses(2)

         23    13    6    5    4
         
  
  
  
  

Total fixed charges

    (B)    1,172    1,725    1,994    1,928    1,775
         
  
  
  
  

Less: fixed charges capitalized

         473    383    797    1,029    621
         
  
  
  
  
          699    1,342    1,197    899    1,154
         
  
  
  
  

Earnings before taxes and fixed charges

    (A)    3,518    3,458    5,252    5,177    5,367
         
  
  
  
  

Ratio of Earnings to Fixed Charges

    (A)/(B)    3.00    2.00    2.63    2.69    3.02
         
  
  
  
  
(1)   Due to the adoption of SSAP 34, “Employee Benefits”, issued by the Hong Kong Society of Accountants, which became effective on January 1, 2002, a restatement of the 2001 financial data was necessary. See Note 42A of Notes to the Financial Statements.

 

(2)   The balance represented one third of operating lease expenses of the Group.