The group's principal area of operation during the year ended 30th June, 2004 was "The Escarpments" major residential resort development project on Katoomba Golf Course in the Blue Mountains, west of Sydney.

Revenue for the year was a negligible $4,262 as a result of completion and settlements of the first stage sales being delayed until the 2005 financial year. After capitalizing appropriate development costs and expensing other items, the group recorded an Operating Deficit of NZ$169,942 for the period.

Despite good progress in the first half of the year, the latter part of the year saw construction delays on both the residential dwellings and the golf clubhouse refurbishment. These were in part due to a significantly expanded scope of works and services in respect of the clubhouse. This resulted in increased construction and holding costs that required additional and increased funding facilities, which in turn caused delays in the residential program.

Whilst these delays in the residential component pushed completion, subdivision and settlement of this stage out to the 2005 financial year, practical completion of the golf clubhouse was achieved in May, 2004 with the Katoomba Golf Club taking occupation that month.

The Board continues to monitor and review the short and longer term development and funding options for the project. With the clubhouse completed, the joint venture purchase of the two remaining development lots settled, and the completion and subdivision of the current residential stage imminent, there is now a greater range of options available to the Board to accelerate returns from the project. This will, in turn, enable the Board to investigate and pursue additional investment opportunities."