NG FUNG HONG LIMITED POSTED SIGNIFICANT GROWTH IN INTERIUM PROFIT

Ng Fung Hong Limited today announced that unaudited consolidated turnover and profit attributable to shareholders for the six months ended 30 June 2000 amounted to HK$3,531.9 million and HK$378.7 million respectively, representing an increase of 14.1% and 42.3% over the same period last year.

Basic earnings per share amounted to HK36.3 cents compared with HK25.6 cents in the first half of 1999, an increase of 41.8%. The Board of Directors declared an interim dividend of HK6 cents per share payable to shareholders on or about 27 October, 2000.

During the period under review, turnover of the foodstuffs distribution & stock raising division totaling HK$1,877.1 million, registered a 8.9% increase over the same period last year. It is mainly due to the recovery of sales volume of livestock since the second half of 1999 as smuggling activities have been brought under control. Accomplishments have also been made in boosting the sales of frozen meat, resulted in a 47.5% increase in sales revenue over the comparable period last year.

The Group has taken active measures to improve margins and increase market shares of its livestock business. A fresh meat processing plant has just commenced operations in Fanling in August this year to provide cut and packed fresh meat products to leading supermarket chains in Hong Kong directly. The new operation is believed to generate greater synergy and enhance profit contribution in the coming year.

The trading of other foodstuffs continues to report satisfactory growth in both turnover and earnings for the first half of this year. Further efforts will be made in broadening product range and building brand names, which in turn will strengthen the Group's competitiveness and market position in foodstuffs distribution.

The supermarket operation recorded satisfactory growth for the first half of this year. Turnover increased by 10.4% to HK$864.9 million and profit before interest and taxation rose by 10.7%. Operations in Hong Kong posted a decline in margins because of price competition. Nevertheless, it was more than offset by business growth in the Chinese Mainland where the CRC supermarket chain performed well with a 24.1% increase in turnover. This was attributable to the opening of new outlets and also to the sales rises of the existing stores. It is anticipated that better results will be realized in the second half of this year, as the price war in Hong Kong gradually abates.

During the first six months of this year, the Group continued to expand its supermarket chain, particularly in the Chinese Mainland, bringing the half year end total to 272 stores. Of these, 66 are in Hong Kong, 32 in Tianjin, 57 in Suzhou, 15 in Beijing, 76 in Shenzhen and 26 in Xuzhou. Achievements have also been made in building up fresh food sales by upgrading the facilities of shops in Hong Kong for provision of fresh food items..

The production and processing business also recorded satisfactory results. Turnover amounted to HK$606.5 million, 35.4% above last year and profit before interest and taxation increased significantly by 125.7%. During the period under review, the Group's associated company, Xuzhou VV Food & Beverage Limited ("Xuzhou VV"), succeeded in listing on the Shanghai Stock Exchange by issuing 100 million A shares. Thus, the Group's interest in Xuzhou VV was reduced from 36% to 25.09%, and recorded a profit of HK$172.2 million from the dilution.

Turnover of the marine fishing operation recorded a 37.7% increase over the same period last year, as a result of the first-time contribution from the aquatic processing and distribution company which was acquired in the first half of this year. However, the operation in West Africa was adversely affected by record high fuel prices with profit contribution being lower than the comparable period last year. It is anticipated that the operating conditions remain difficult as the fuel prices continue to stay at high level, although measures have been taken in implementing cost savings..

During the period under review, the slaughterhouses operated by the Group have recorded an increase in slaughtering volume. It is expected that the abattoir business will continue to generate stable revenue to the Group. Furthermore, the Sheung Shui Slaughterhouse which has become fully operational in the first half of the year has been recently awarded ISO 14001 certification in respect of its Environmental Management System. The award not only confirmed the Group's dedicated efforts in implementing a comprehensive environmental protection system, but also demonstrated that the operation complies fully with international standards.

Mr. Chen Shulin, Chairman and Managing Director of Ng Fung Hong Limited, remarked that he was pleased with the interim results and is confident of the Group's future development and performance. With a solid financial position and an established distribution network in both Hong Kong and the Chinese Mainland, the Group is well poised to expand its presence in food distribution and strengthen its distribution network, complementing it with fully integrated facilities. It also plans to step up efforts in building and developing brand products. Greater focus will be placed on the Chinese Mainland market, as China's imminent entry into the World Trade Organization will provide new business opportunities. Measures to better integrate the sales network of the Group's joint ventures in the Chinese Mainland with those of the CRC supermarkets will also be introduced to generate more synergy. On the international front, the Group is exploring opportunities to channel Chinese products to international markets through its existing distribution network in Asia, Africa and Europe. In the long term, the Group will also seek leading international distributors as strategic partners to expand the reach of Chinese products globally.

Issued by : Ng Fung Hong Limited
Inquiry : Yu Fung Han
Telephone : 2593 8772

NG FUNG HONG ANNOUNCED CONTINUOUS PROFIT GROWTH IN 1999 WITH A 28.6% INCREASE IN DIVIDENDS

Hong Kong, April 26, 2000 - Ng Fung Hong today reported a 4.7% increase in profit attributable to shareholders of HK$549,730,000 for the year ended 31 December 1999 compared with the same period last year. The Group's turnover decreased by 3.7% against that of 1998 and amounted to HK$6,663,962,000.

Basic earnings per share was HK 52.8 cents, up by 3.3% as compared with HK 51.1 cents of the previous year. The Board of Directors has recommended a final dividend of HK 12 cents per share. Together with the interim dividend paid, the total dividend for the year amounted to HK$18 cents per share, representing an increase of 28.6% as compared with previous year.

Reviewing the Group's operations, Mr. Chen Shulin, Chairman and Managing Director of Ng Fung Hong Limited, said, "The period under review has been challenging to Ng Fung Hong although there have been signs of modest improvement in Hong Kong since the second half of 1999. Declining consumer spending, price deflation and supermarket price competition has brought adverse effects to some of the Group's businesses. Notwithstanding this difficult operating environment, the Group achieved continuous profit growth."

Foodstuffs distribution and stock raising reported a 13.6% decline in turnover to HK$3,717,278,000 . The operation was affected, particularly in the first half of the year, by sluggish demand and rampant smuggling of pigs and pork products. This difficult operating environment was further exacerbated by growing competition of chilled meat imported from other Asian countries. In view of this, the Group has taken prompt measures to improve its competitiveness and recapture market share by reducing the price of live pigs for the first time in its history. The price repositioning adopted in 1999 proved to be successful as sales by volume have gradually recovered since the second half of the year and market share has improved to 82% from 78%.

The Group will endeavour to boost direct sales of fresh meat to leading supermarket chains and institutional customers in Hong Kong and enlarge market share of frozen meat distribution. A new fresh meat processing plant is scheduled to commerce operation in June this year to enhance production capacity. The Group foresees that this will lead to further increase of sales volume and profit margin.

To further upgrade the quality of hog supplying to Hong Kong and reduce the production cost, the Group will form strategic alliance with livestock-supplying companies in the Chinese Mainland and swine genetics companies in Iowa, the U.S.A. to set up swine technology centre in the Chinese Mainland this year.

In respect of the trading of foodstuffs, the Group will continue to strengthen the establishment of brand names and the development of product range. The trading of foodstuffs carried out by Ng Fung Trading Limited will make the Group's food production and processing business operating interactively with all aspects of the marketing of foodstuffs.

The supermarket operation registered a satisfactory growth in the face of price competition, and weak consumer demand resulting from the economic recession. Turnover increased by 11.3% over that of last year to HK$1,613,914,000 and profit before interest and taxation rose by 10.6%. This is largely due to the increase in the number of outlets, especially in the Chinese Mainland, which generates economies of scale and improves the profit margin through the leveraging of the combined purchasing power. In the third quarter of 1999, the Group acquired the remaining 40% interest in China Resources Supermarket (Hong Kong) Company Limited for a cash consideration of approximately HK$117,600,000. The acquisition provides the Group with a good opportunity to strengthen its retail operation.

During the year, the Group opened 51 new shops, of which 49 were in the Chinese Mainland and the remaining in Hong Kong, bringing its year-end total to 243 outlets. Up to the end of 1999, the total gross floor area of CRC supermarket chain reached 114,000 square meters, an increase of 14% over last year. In terms of number of outlets, the Group is currently the largest supermarket chain store operator in Shenzhen, Suzhou and Tianjin. According to Mr. Chen, Ng Fung Hong plans to place greater focus and resources on the Chinese Mainland market where economic growth is expected to accelerate. It is scheduled to open approximately 79 new shops in the year of 2000 to further strengthen the Group's presence in Shenzhen, Suzhou, Tianjin and Beijing. As for Hong Kong operations, 10 new shops will be opened. Efforts will also be made in building up fresh food sales and securing stronger penetration for products under "NF" brand.

Turnover from foodstuffs production and processing amounted to HK$1,038,214,000, 22.3% above last year and profit before interest and taxation rose by 41.4%. In which, marine fishing and aquatic product processing experienced a strong performance with a growth of 31.6% and 26.6% in turnover and profit before interest and taxation respectively, reflecting an encouraging recovery in prices and demand for fish in the second half of the year. Accomplishments have also been made in developing more fishing grounds, increasing product range as well as establishing direct sales network. Last year, the Group added 7 vessels to the fleet, making a total of 124 vessels with 19% growth in total catches to 57,500 tons against that of the previous year. The Group has recently acquired a 51% interest in an aquatic processing and distribution company for HK$50,000,000 to reinforce its sales network in Hong Kong and the Chinese Mainland market. The Group also plans to add 3 tuna fishing vessels to uplift total catches and upgrade the facilities of the processing plant to improve operating efficiency.

The performance of the ice-cream business in Hangzhou of the Chinese Mainland was desirable with growth in both turnover and earnings contribution. The Ng Fung Ice-cream manufactured by this operation has become the No.1 well-known brand name in Zhejiang Province. The Group will further enhance investment and management in this division.

Xuzhou VV, a 36% owned associate acquired by the Group in December 1998, achieved satisfactory results in 1999. These are the first full year profits that are accounted for in the Group's financial statements, resulting in significant rise in the share of associates profit in 1999. The company has filed an application for a listing on the Shanghai Stock Exchange, pending for approval from the relevant authorities.

Sheung Shui Slaughterhouse has commenced trial operation in August 1999, and it is fully operational by the end of March 2000 to replace the slaughterhouses in Kennedy Town, Cheung Sha Wan and Yuen Long. It is one of the most modernised slaughterhouses in Southeast Asia incorporating the latest and advanced slaughtering equipment. The Group believes that the operation will improve overall operating efficiency and further enhance cost effectiveness.

The Group views the growth of the Internet and e-commerce as a global mega-trend and anticipates that it will have a major impact on the trading pattern in the world over the next decade. At present, the Group is, together with its holding company - China Resources Enterprise Limited, actively exploring how to develop the e-commerce business and has appointed a professional consulting firm to undertake the drawing up of feasibility study reports and proposals.

According to Mr. Chen, Ng Fung Hong is well positioned to benefit from the gradual recovery in consumer spending. Capitalising on the Group's strong financial strength, Ng Fung Hong will continue to focus on its existing core businesses. The Group will dedicated to sustaining long-term profit growth by expanding its retail network, increasing food production capacity as well as adopting effective cost control measures.

For further information on this release, please contact
Terence Hon / Alice Chong
Ng Fung Hong Limited
Tel: (852) 2593 8789 (852) 2593 8777
E-mail: alice@nfh.com.hk

For announcement, please refer to:
Ng Fung Hong internet site at http://www.nfh.com.hk
IRASIA internet site at http://www.irasia.com/listco/hk/ngfunghong

Ng Fung Hong Limited Announced Steady Interim Profit Growth & Acquisition of Remaining Interest in Supermarket Operation

Ng Fung Hong Limited today reported a 4.4 % increase in profit attributable to shareholders of HK$266,177,000 for the first six months to June 30, 1999 compared with the same period last year. Unaudited consolidated turnover, however, fell 9.4 % to HK$3,096,169,000.

Basic earnings per share was HK25.6 cents, representing an increase of 2.8% over the same period. The Board of Directors declared an interim dividend of HK6 cents per share payable to shareholders on or about October 21, 1999, which is two times that of last year.

For the first half of 1999, the operating environment remained tough and difficult as deflation still weighed heavily on Hong Kong. Consumption shrank and retailing was weakened. The Group's foodstuffs business, though was closely related to people's daily living, has been affected inevitably.

During the period, foodstuffs distribution business, under the adverse impact of a sluggish demand and rampant smuggling of pigs and pork, has decreased in sales. In view of this, the Group took active measures by reducing the price of live pigs for the first time in its business, after taking full account of people's buying power. Market share increased from 78% to 82%. And sales has recovered since April. Profit margin has also been widened by two percentage points year on year through cost constrains, as well as strengthened vertical integration. At the same time, the Company has made far-reaching achievements in retailing and direct sales by providing quality meat products for established supermarket and fast food chains. Product assortment and quantity have increased in frozen meats and aquatic product business. Besides, the Company has been active in taking part in public tender for provision of foodstuffs. Efforts have also been stepped up in developing wholesale network for meat products in the mainland. The construction of fresh meat and frozen meat processing plants has started. Being committed to providing for the people of Hong Kong with meats of the best quality, the Group has always been working closely with both the HKSAR and the mainland governments in fighting smuggling, which has been under control since the second quarter of the year through concerted efforts of the various parties. Better results are expected from distribution business with a turnaround in economy in the second half of the year.

Despite the sluggishness of the market, the Group's supermarket operation was able to maintain a growth of 21% in sales, achieving a steady development in business. Expansion continued and outlets have increased to a total of 244, a net growth of 24 shops. Of these, 184 shops are located in the mainland, with 64 in Shenzhen, 51 in Suzhou, 13 in Xuzhou, 21 in Shanghai, 26 in Tianjin and 9 in Beijing. Most of the new outlets are located in the mainland, in line with the Group's long-term strategy.

Turnover and contributions from foodstuffs production and processing have experienced an increase against the corresponding period of the previous year. A steady growth in sales was also posted in marine fishing and aquatic product processing, winery as well as frozen food production. As for marine fishing and aquatic product processing, actions have been taken to further strengthen the management of the operation. Logistics bases have been relocated to reduce transportation cost. Accomplishments have been made in developing more fishing grounds, raising product items and quantity in processing as well as establishing more direct sales network. Breakthroughs have been made in production after a series of reengineering program in wine production. Up-market "Moisson" Brand dry red wine has been successfully launched. Xuzhou VV Food & Beverage Limited, an acquisition made in December last year, has yielded for the Group a substantial income. It is anticipated that this company, having maintained a leading position in the soyamilk product market in China, will deliver far better results in the second half of the year.

Sheung Shui Slaughterhouse has commenced operations in late August and will be in full operations before the end of this year. Ng Fung Hong has become the only abattoir operator in Hong Kong. It is hoped that the new slaughterhouse, the most technologically advanced in Asia, will help not only raise the quality and hygiene standard of the meats provided for Hong Kong, but also foster good return for the Group. Synergy thus created is also expected to fuel the growth of the foodstuffs distribution business.

1999 was designated to be the year for a revamp of the Group's investment projects. A review and consolidation has been in place. It is hoped that through concerted efforts, management and operating efficiency will be improved, rules and regulations will be standardized. Likewise, internal structural reorganization was also in progress to enhance corporate management, and achieve a better allocation of resources among the operational subsidiaries. Ng Fung Trading Company Limited, the Group's trading arm established in the first half of the year by merging eight foodstuffs trading divisions within the Group, would help further lower overheads and improve operating efficiency. More and more Ng Fung brand name products have been developed and marketed. And better results are expected from this operation in the second half.

Hong Kong is on the path to recovery and the economy is believed to bottom out in the second half of the year. A pick-up in consumption is also anticipated in the China market with the Chinese government's endeavours in pushing domestic demand. The Group is working hard for a breakthrough in its operations. As for foodstuffs distribution, the Group will strengthen its marketing muscle, expand the sales network, push ahead with the development of retailing and direct sales. Adjustments will also be made in response to changing market conditions. Supermarket operation will expand and develop as scheduled, speeding up the penetration of the mainland market and broadening merchandise assortments especially fresh foodstuffs. On the production and processing front, efforts will be stepped up in developing new products, boosting production and value-added processing capacity. Work will also be dedicated to marketing and promotion. The Group believes that a strengthened integration in production, distribution and sales will help enhance profit contributions. At the same time, the Group will speed up the development of projects under negotiations and seek potential investment opportunities in the direction adopted by the management. The Group envisions a high growth and better returns in its business through dedicated efforts, given its competitive strengths, strong fundamentals, and prudence in investment and management.

The Company today also announced that, subject to the final approval of the Extraordinary General Meeting, an agreement has been reached with its parent company, China Resources (Holdings) Company Limited, for the acquisition of the remaining 40% interest in China Resources Supermarket (Hong Kong) Company Limited ("CRS") for a cash consideration of HK$117.6 million. It represents a price earnings multiple of 6.7 times and was funded by internal resources. Upon completion of the acquisition, CRS would become a wholly owned subsidiary of the Company.

"The acquisition not only provides a good opportunity for the Group to obtain a full operational control, but also enables us to draw up a better development strategy for the supermarket operation. With our full financial support, the operation will enter a new horizon." Mr. Chen Shulin, Chairman and Managing Director of Ng Fung Hong Limited said.

SATISFACTORY GROWTH IN 1998

Ng Fung Hong Limited today announces pleasing results for the year ended December 31, 1998. Profit attributable to shareholders amounted to HK$525,089,000, representing an increase of 15.7% against that of 1997. Turnover also posted a growth of 8.8% to HK$6,921,635,000. Earnings per share for the year was HK 51.1 cents, up by 14.6% as compared with HK 44.6 cents of the previous year.

The Board of Directors recommended a final dividend of HK 11 cents per share. Together with the interim dividend paid, the total dividend for the year amounted to HK 14 cents per share, representing an increase of 16.7%.

This is the third consecutive year the Group has recorded a double-digit growth in profits since its listing in 1995. Mr. Mark S.L. Chen, Chairman and Managing Director of Ng Fung Hong Limited, remarked that the Company's efforts in maintaining cost constraints, improving operating efficiency and adopting operational streamline during the economic uncertainties are accountable for the pleasant growth.

"Ng Fung Hong is able to maintain a sound and solid financial position with strong cash flows against a backdrop of tightened liquidity and credit crunch. This has been the fruit of a sustained effort in upholding a policy of stringent and prudent development in our business operations." Mr. Chen said.

During the year under review, foodstuffs business is still the mainstay of the Group which has directed all its muscle to the development and vertical integration of the food related businesses, particularly in distribution, stock raising, production and processing, abattoir operation and retailing.

The supermarket business still achieved a steady sales growth despite the decline in consumption and the sluggishness of retailing in both Hong Kong and the mainland. Expansion has proceeded as scheduled with an addition of 53 new shops during the year in both regions and has secured a penetration into Beijing and Xuzhou. The total sales area has also exceeded 100,000 square meters, representing a significant increase of 45.8%.

Turnover from foodstuff production and processing increased by 60.1%. The increase was mainly from the Group's investments in marine fishing and aquatic product processing made in July 1997. Efforts will be stepped up in exploring more fishing grounds, diversifying its processing operations and enhancing its value-added processing capacity so as to raise the profit margin.

The Group's abattoir operation was able to achieve satisfactory performance amidst the sluggish market conditions. Sheung Shui Slaughterhouse which will help improve the overall operating efficiency of the fresh and live foodstuffs business and enhance the Group's profits, is expected to commence operations in the coming August.

In face of the financial turmoil, the Group has started to modify and finetune its investment plans earlier last year. A total of four investment projects have been made, involving an amount of HK$355,560,000 which was funded entirely by internal resources. Projects acquired included wine and beverage production, cattle raising and processing, foodstuffs packaging and soyamilk product production. Xuzhou VV Food and Beverage Limited, a 36% equity joint venture acquired by the Group in December 1998 for a consideration of HK$196,490,000 is by far the biggest acquisition for the year. The project, which is engaged in the production and distribution in the mainland of soyamilk products, enjoys a leading position in the industry.

As at 31 December 1998, the Group's net cash (net of short-term and long-term bank loans) stood at HK$1,118,310,000 with a current ratio of 2 times. In 1998, the net cash inflows from the Group's operating activities amounted to HK$972,168,000, reflecting that the Group's business continues to provide a steady recurring cash flow.

During the year, the Group has undergone a shareholding restructuring and internal structural reorganization, aimed to help strengthen corporate and business development as well as to improve operating efficiency.

The Group will devote most of its efforts to maintaining a sound financial management, improving asset quality and ensuring a strong cash position. It will also continue to focus on its core business, which is expected to generate a steady and solid recurring cash flow for the Group in the future.

Ng Fung Hong Limited announced that the Company has entered into a conditional agreement to acquire a 36% equity interest in Xuzhou VV Food & Beverage Limited ("Xuzhou VV"), a sino-foreign joint venture, for a cash consideration of HK$196,420,575. The acquisition will be funded wholly by internal resources.

Xuzhou VV is principally engaged in the production, sale and distribution in the Chinese Mainland of soyamilk products including soyamilk powder and soyamilk drinks under the "Wei Wei" brand name. "Wei Wei" is a well-established brand name for soyamilk products.

Xuzhou VV was established in 1992 with its operations based mainly in Xuzhou, Jiangsu province. It has boasted a rapid increase in both sales and profitability since establishment and has built up an extensive distribution and marketing network in the Chinese Mainland.

Net profit after taxation of Xuzhou VV for the year ended 31st December, 1997 was approximately RMB104,251,000. The consideration represents a price-earnings multiple of approximately 5.6 times of the 1997 profit.

The acquisition represents a prime investment in the Company's expansion in the food processing business. It not only enables the Company to diversify its product categories, it also enhances its expansion into the China food market. Further, with the well-established brand name, an extensive distribution network and an experienced management team, it will broaden the Company's income base and increase its earnings.

Ng Fung Hong Limited today announced satisfactory growth in both turnover and net profit for the first half of 1998. Turnover rose from HK$2,718 million to HK$3,418 million, up by 25.7%. Attributable Profit also posted a growth of 25.7% to HK$255 million.

Basic earnings per share was HK24.9 cents, representing an increase of 24.5% over the same period last year. The directors recommended an interim dividend of HK3 cents per share payable to shareholders on or about October 19, 1998.

Mr. Chen Shulin, Chairman and Managing Director, said that he was pleased with the Group's performance particularly in face of the stifling operating environment. "For the past six months, Hong Kong has experienced the most difficult time. Our livestock business was hit by issues of E.coli O-157:H7 and asthmatic drug in pig offal. However, we were able to sustain a considerable growth in our business, which is mainly attributable to the strenuous efforts and prompt measures of the management in addressing the situation and maintaining a steady increase in the core business. Returns from new investment projects also contributed much as a growth driver.

"The defensive nature of our core business has not only helped us to weather through the difficulties, but also added to our advantage. During the year, our supermarket sales registered an increase of 21.6% against the economic downturn. Besides, prudence in corporate development has proven to be our asset."Mr. Chen said.

Marine fishing and processing and distribution of aquatic products operation continued to grow and developed as scheduled, with an enhancement in production capacity through the opening of the new extension of the aquatic product processing plant in Senegal.

The year's first half has seen the Group completed two acquisitions, enabling it to extend its reach into cattle raising and meat processing as well as production of wine and beverages.

Ng Fung Hong Showcased Food Products In Brand New Image

Ng Fung Hong Limited participated in Food Expo '98 organized by Hong Kong Trade Development Council from August 19 to 23, 1998 on Level 5, Hong Kong Convention and Exhibition Centre to showcase brand speciality foodstuffs distributed by the Company. A series of new products developed under the brand name "NF" were also featured in the fair.

As one of the major plays in the food industry of Hong Kong, Ng Fung Hong has been a sponsor and regular participant of Food Expo. This year, Ng Fung Hong returned with a good variety of new products and in a brand new look. The booth which took the form of a "running" train compartment was a vivid embodiment of the theme "Ng Fung cares and looks after your daily living". This featured the importance of Ng Fung Hong as an integrated food enterprise, committed to the provision of daily necessities for the people of Hong Kong. The many foodstuffs displayed in the exposition were categorized in series as "daily necessities", "health food", "instant food", and "snacks". They are all catered to the needs of the modern society.

"Fung Fung Dumplings", "Five Cereals Porridge", "Golden Millet", "Pure Black Rice", "Hawthorn", "Egg Rolls" and "Sliced Pork" were some of the delicacies newly developed under "NF" brand. They made their debut in the exposition and were well-received by the visitors.

The fair has attracted hundreds and thousands of visitors and many frequented Ng Fung Hong counter for its delicacy appeal. It was believed that the exposition would act as a platform through which more and more products of Ng Fung Hong would be made known to the people of Hong Kong.

30.6.1998

Ng Fung Hong Limited today announced the set up of Ng Fung Transport & Storage Service Ltd. by merging Man Luen Hong Motor Co., Ltd., Sun Luen Motor Co., Ltd. and the Company's Transport and Storage Division. The new company will commence operations today.

The merge, in line with the Company's strategy of centralizing business operations, is introduced to streamline and consolidate the business. It is expected that the move, apart from ensuring supply meets demand throughout the year, will help boost cost effectiveness and operational efficiency. It is believed that the arrangement will enable the operation to better cope with the changes brought by the inauguration of the Sheung Shui Slaughterhouse in mid-1999. Competitive strength will also be enhanced.

29.4.1998

China International Fisheries Corp, Ng Fung Hong's operation in West Africa, recorded a healthy growth and made satisfactory profit contribution to the Group during the year.

The new extension of the aquatic product processing plant in Senegal has completed construction and started operation at end of last year. An opening ceremony was held on 29th April. Mr. Chen Shulin, Chairman and Managing Director of Ng Fung Hong Limited attended and addressed the ceremony, emphasizing its significance as the Group's penetration into the international market.

The new processing extension which has a daily processing capability of up to 30 tonnes of aquatic products, is equipped with the latest and technologically-advanced facilities in line with the European standard. It is believed that the extension will add value to the processing and enhance the profits. The Company plans to further expand the processing of value-added products with a view to strengthening the earning capabilities by turn of the century.

Ng Fung Hong Limited today announced that the Group had achieved more than favourable returns in most of the business domains for the year ended December 31, 1997. Turnover rose to HK$6.4 billion, representing a remarkable growth of 41.4%. Profit attributable to shareholders also recorded a significant increase of 25% to HK$453.7 million, compared with the same period last year.

Earnings per share for the year was HK44.6 cents, up by 23.2% as compared with HK36.2 cents of the previous year.

The Board of Directors recommended a final dividend of HK9 cents per share which together with an interim dividend of HK3 cents makes a total dividend payable for the year HK12 cents per share.

Mr. Chen Shulin, Chairman and Managing Director of Ng Fung Hong Limited attributed the outstanding performance to the Group's strenuous efforts in strengthening the existing core business and diversification as well as to prudent acquisitions.

During the year, the Group was committed to developing new revenue streams through quality acquisitions and investments, which, complemented by vigorous efforts in vertical integration, has secured for the Group a more diversified, well-balanced and healthy development.

A total of HK$880 million was invested in acquiring five new projects with growth potnetials and good returns. These new investments, including three foodstuffs manufacturing plants, a supermarket operation, a marine fishing enterprise, a pig raising operation and a frozen meat processing plant, have not only brought more profits to the Group, but also enhanced its upstream and downstream operational capabilities.

Ng Fung Hong Limited has completed the acquisition of a 49.9% interest in Ng Fung Fortune Food Co., Ltd. for a consideration of RMB84,150,000 (approx. HK$78,970,000). It was funded by internal resources.

Ng Fung Fortune is a joint venture between Ng Fung Hong Limited, Inner Mongolia Cereals, Oils & Foodstuffs Import & Export Corporation and Fucheng Cattle Raising Group Company. It is the largest cattle raising enterprise in the PRC with business ranging from beef cattle raising, slaughtering and meat processing.

Located in Sanhe city, 40 kilometers east of Beijing, Ng Fung Fortune has an area of over 200 mu. It is well-known for expertise in slaughtering which is comparable to the European and American standard and is one of the few cattle enterprises in the PRC capable of producing high-end beef. Part of the live cattle are exported to Hong Kong, Middle East and North Korea while the quality ones are kept for own processing of high-end beef for the consumption of renowned hotels, banquet halls and national guesthouses in Beijing. Its products also cater for the demand of big cities like Tianjin, Qingdao, Changchun and Nanjing.

Mr. Chen Shulin, Chairman and Managing Director of Ng Fung Hong, said, "The project will help upgrade the quality of our live cattle and frozen beef supply, securing ourselves in the high-end beef market in both the mainland and Hong Kong. Besides, this will also enhance the Company's vertical integration, strengthening the upstream and downstream operating capabilities of our food business. The venture looks promising as it has pooled the competitive strengths of the three partners."

Ng Fung Fortune plans to strengthen its slaughtering business and enlarge the share of the mainland market through the expansion of production scale and chilling capabilities.

Ng Fung Hong Limited today announced the establishment of Ng Fung Frozen Meats & Aquatic Products Co., Ltd. by merging two divisions and two subsidiaries engaged in frozen foodstuffs and aquatic products business. The new company will start operations today.

Ng Fung Frozen Meats & Aquatic Products Co., Ltd. is formed to integrate the frozen meats and frozen poultry business, of which the Group is the general agent in Hong Kong. The move is introduced to streamline and consolidate the Group's business. It is expected that the merge will help boost cost effectiveness and operational efficiency, thus enabling the Group to enlarge its market share in Hong Kong.

The new subsidiary, boasting a vast newtwork of supply from both overseas and the Chinese mainland, is engaged in distribution of frozen meats, frozen poultry and aquatic products. The meats and poultry distributed are quality products which have met with the country's strictest export standard of health inspection and quarantine regulations.

Mr. Liu Youhui, Executive Director of Ng Fung Hong Limited, is appointed Chairman of the new company. Managing Director, Mr. Jiang Weishi and Deputy Managing Director, Ms Gujin are noted for their substantial experience and expertise in the business.

1.1.1998

The Board of Directors of Ng Fung Hong Limited announced that Mr. Wang Wangheng has retired as Managing Director of the Company with effect from January 1, 1998. Mr. Chen Shulin, in addition to his existing capacity as Chairman of the Company, assumed the position of Managing Director on the same date.

Ng Fung Hong Successfully Concluded Its Maiden Syndication Agreement

Ng Fung Hong Limited signed a loan agreement today with 15 international financial institutions in relation to a US$130 million 5-year Revolving Credit and Term Loan Facility. The interest rate is 0.435% p.a. above LIBOR. Proceeds of the Facility will be used for general corporate funding.

Marking its entry into the debt market, Ng Fung Hong's maiden syndication received strong support from the market making it necessary to enlarge its size from US$120 million to US$130 million. The oversubscription, the number of participants and the 60% selldown of the syndication are regarded as a boost to confidence under the current sluggish economic conditions. The signing also evidenced that for borrowers, like Ng Fung Hong, having good credit quality and rarity value attract good response from international debt market.

Ng Fung Hong Awarded the Sheung Shui Slaughterhouse Operation Services Contract

Ng Fung Hong Limited signed the Operation Services Contract for the Sheung Shui Slaughterhouse with the Government of the Hong Kong Special Administrative Region today.

The Sheung Shui Slaughterhouse, situated to the north of Sheung Shui Railway Station and neighboured by the Shek Wu Hu Sewage Treatment Plant, is scheduled to commence operation in mid 1999. It occupies a total area of about 58,000 sq. m. and is one of the most modernised slaughterhouses in Southeast Asia incorporating the latest and technologically-advanced slaughtering equipment.

The Company expects that the operation will further enhance cost effectiveness and help to maintain its position at the forefront of the industry.

Investment Holding Company of Ng Fung Hong Restructured To Facilitate Trading Operation

Ng Fung Hong (Holdings) Limited, the investment holding company of Ng Fung Hong Limited, merged with Teck Soon Hong, Ltd. and Finarts Trading Co., Ltd. to form Ng Fung-Teck Soon (Holdings) Limited, under the reorganization arrangement of China Resources (Holdings) Co., Ltd. Its role is to take up all the trading business for the parent company in a bid to streamline the Group structure.

Mr. Chen Shulin, Chairman of Ng Fung Hong Limited, is appointed Chairman of this company. The restructure will allow the company to integrate trading with investment and asset operation, thus fostering business growth in a few years.

Ng Fung Hong Announces Satisfactory Interim Profit Growth

Ng Fung Hong Limited reported a 25.8% increase in profit attributable to shareholders of HK$203 million for the six months ended June 30, 1997. Turnover also grew by 20.2% to HK$2,718 million over the same period last year. Earnings per share increased to 20.0 cents.

The Directors recommended an interim dividend of HK3 cents per share payable to shareholders on or before October 23, 1997.

Mr. Chen Shulin, Chairman of the Group, said that the satisfactory growth has been achieved through success in developing investment projects and implementing business diversification.

Ng Fung Hong Promotes Its Brand Products in the 8th Food Expo

Ng Fung Hong Limited joined the 8^th Food Expo hosted by Hong Kong Trade Development Council from 14^th to 18^th August, 1997 on Level 5, Hong Kong Convention and Exhibition Centre to promote the brand foodstuffs distributed by the Company. A series of products developed and marketed under the brandname "NF" will also be highlighted in the fair.

An on-site entertainment program entitled "The Palatable Ng Fung Appeal" will also be held on 16^th August to create more publicity for Ng Fung Hong. Mr. Chen Shulin, Chairman of the Group, and Ms Kwan Wing Ho, a TVB star, will present the program as guests of honour.

Ng Fung Hong Adopted Measures On Beef Hygiene

Ng Fung Hong Limited announed full support to the resolution adopted by Kowloon Beef & Mutton Merchants Association Ltd. and Hong Kong Cattle Slaughter Trade Associations Ltd. that local butchers and meat shops would cut the supply of cows' offal starting from May 25, 1997. The move is intended to check E-coli O-157:H7 bacteria contamination.

A set of measures will be taken by the Group's as well as the government abattoirs. After slaughter, the cows' carcasses are separated from offal. Their hearts and livers are then destroyed while intestines are sent to the agents for sale only. Further, the carcasses and intestines are delivered separately. Other measures, including more frequent cleaning of the carcasses and fitting essential parts of the slaughterhall with stainless steel plates, are also adopted.

The Company believed that the separation of cows's innards from carcasses in the process of slaughtering, treatment, transportation and sale was one the most effective measures to minimize chances of cross-contamination.

Ng Fung Hong Acquired A Majority Stake In Fisheries Corporation To Penetrate Into International Food Market

Ng Fung Hong Limited announced the acquisition of a 51% interest in China International Fisheries Corp (CIFC) for a total consideration of US$80,545,500 (approximately HK$622,616,715), which was funded by internal resources.

CIFC, a Chinese operation based in West Africa, will be a co-investment between Ng Fung Hong and CNFC International Fisheries Corp. Its activities include marine fishing, processing, sale, refrigeration, transportation of aquatic products and production and operation under international co-operation fishing projects.

CIFC has built up a fleet of 115 vessels (both chartered and owned), cold storage and other terminal facilities in West Africa.

A processing plant is operating in Dakar, capital of Senegal. The products reach as far as Europe, Japan, Africa and Asia especially China markets.

Mr. Chen Shulin, Chairman of Ng Fung Hong, said, "The controlling interest in CIFC represents a prime acquisition in the Company's diversification into different sources of income and greater range of high quality foodstuffs. It enables the penetration into the fishing and processing of aquatic product market which in turn will generate additional revenues to the Company."

Ng Fung Hong Acquired A Majority Stake in An East China Pig Farm Operation

Ng Fung Hong announced today the acquisition of a 51% stake in Shanghai Ng Fung Livestock Poultry & Foodstuff Co., Ltd., a joint venture between Ng Fung Hong and Shanghai Foodstuffs Import & Export Corporation. The operation runs 12 pig farms which produce a total of 250,000 heads of pigs annually. It supplies principally to Hong Kong market, accounting for about 10% of the total supply of live pigs from China.

This investment in East China is expected not only to broaden the production base and operation scale, but also improve the quality of pigs. This will raise profit margin and complement the vertical integration of the operations.

Ng Fung Hong Announces Pleased Annual Results

Ng Fung Hong recorded a 20% growth in profit attributable to shareholders, reaching HK$363,137,000 for the year under review. Operation profit also posted HK$422,873,000, an increase of 19.6% over last year. Earnings per share amounted to HK 36.2 cents.

The Directors recommended a final dividend of HK 8 cents per share for the year ended December 31, 1996, payable on or before June 5, 1997.

Operating profit margin also grew from 6% to 7.6% as a result of the Group's achievement in cost control and efficient operation combined with development of other foodstuffs business.

Mr. Chen Shulin, Chairman of the Group, remarked that he was pleased with the results. "Ng Fung Hong will continue to strengthen its core business and income base. At the same time, we will undertake to pursue with our investment strategy of vertical integration by expanding upstream and downstream of the foodstuff business to maximize profit margin and develop other foodstuff business with growth potential."

"To spearhead growth and expansion, we have finetuned strategic plans to invest in 5 areas - fresh, live and frozen foodstuffs distribution and production; retail and supermarket business; abattoir and meat processing operations; marine fishing and processing of aquatic products; wine and beverage production. By vertical integration, Ng Fung Hong is well-positioned to capture the potential upside of the food market and step forward to the goal of becoming a globally dominant food conglomerate." said Mr. Chen.

Ng Fung Hong Diversifies into Supermarket Operation and Food Production Business

Ng Fung Hong announced the acquisitions of 60% and 100% interest in China Resources Purchasing Company Limited (CRPCL) and Ng Fung Hong (Hong Kong) Food Ltd. (NFH Food) respectively. Ng Fung Hong agreed to pay CRPCL a total consideration of HK$198,800,000, including cash and loan, for the acquisition whereas for the NFH Food Acquisition , the consideration totalled HK$76,500,000.

The CRPCL Group is principally engaged in the supermarket business in Hong Kong and China under the name "CRC Shop". The CRPCL Group which is the third largest supermarket chain in Hong Kong currently operates 46 and 70 stores in Hong Kong and China respectively. The acquisition will allow Ng Fung Hong to extend into the retail market as well as to turn into a regional play in the food industry with an extensive distribution network in both Hong Kong and China.

The NFH Food Group is engaged in the manufacturing and sale of ice-cream products and refrigerated food products in China under the "NF" trademarks. Its products are being sold through its extensive distribution network of over 300 wholesale and distribution agents in 13 provinces in China.

The two operations will undergo further expansion on completion of the acquisitions