TURNOVER UP 22.7% TO HK$452,588,000
PROFIT RISES 64.6% TO HK$20,102,000
(Hong Kong, March 20, 2003) -- Leading Hong Kong plastic resins and specialty colourants supplier Ngai Hing Hong Company Limited and its subsidiaries (the :Group;) (Stock code: 1047) announced its interim results for the six months ended December 31, 2002. The Group・s turnover increased by 22.7% to HK$452,588,000 against HK$368,734,000 in previous corresponding period and made a profit attributable to shareholders of HK$20,102,000, representing a surge of 64.6% from HK$12,214,000. Earnings per share for the period amounted to HK6.70 cents (2001: HK4.07 cents). The Board has recommended an interim dividend of HK3.0 cents (2001: HK2.0 cents) per share.

Mr. Hui Sai Chung, Chairman of Ngai Hing Hong said, :During the review period, the slow recovery in global economies created significant impact on the overall business environment. Despite this unfavourable condition, the Group managed to achieve positive developments during the first half of the year by riding on its clearly-defined and prudent business strategies as well as its solid business foundation. We are pleased to report a substantial increase in both our turnover and profit, compared to the results of previous corresponding period which were adversely affected by the 911 incident. This was mainly attributed to the satisfactory contribution of the Group・s colourants and engineering plastics manufacturing business and the plastics trading business and our implementation of effective and prudent cost controls.;

During the period under review, the Group・s colourants and engineering plastics manufacturing business recorded a significant increase in both turnover and sales volumes. In particular, the manufacturing business with its higher gross profit margin accounted for a considerably higher portion in the total turnover, contributing to the overall rise in the Group・s gross profit margin. This has demonstrated signs of gradual recovery of the Group・s business after the incident and was fuelled by the increase in market demand.

Regarding its plastics trading business, the Group succeeded in penetrating the PRC market. Ngai Hing (GZFTZ) Trading Co., Ltd., commencing business in the Guangzhou Free Trade Zone in May 2002 has established new customer network in southern China, which provided additional source of revenue for the Group. If such encouraging responses persist, the Group will set up additional trading offices in other major cities in the PRC.

During the review period, the continuing satisfactory performance of the Group・s manufacturing business was resulted from its committed efforts in recent years. The colourants and engineering plastics manufacturing business recorded promising growth in the turnover and sales volumes, particularly in the latter. The Group・s tailor-made engineering plastics have persistently received overwhelming market responses. At the same time, the market performances in the eastern and southern parts of the PRC were improving steadily. The full commencement of the production lines at the Qingdao plant greatly increased production capacities, generating further contributions for the Group.

Apart from strengthening existing business, the Group also explored new business segments to strengthen its market edge. Leveraging its extensive experience in the colourants business, the Group entered into a cooperation with a sizable building materials company in the PRC to provide the know-how for the use and application of colourants in the production of construction materials during the review period. This new development created a new stream of revenue for the Group.

To cater for the growing market demand, the Group has committed resources to raise its production capacity. The construction of the Group・s new plant in Shanghai completed at the end of 2002, replacing its previous rented plant. The new plant commenced production in February 2003, enabling the Group to have a more flexible control in its production capacities leading to savings in production costs. Additionally, the installation of production machineries in newly leased plant at the Tai Po Industrial Estate in Hong Kong completed and production commenced in March 2003.

Mr. Hui concluded, :Looking ahead, the Group is highly optimistic for the prospects of the PRC economy, especially after its accession to the World Trade Organisation. To capture the emerging business opportunities, we will continue to provide quality products and value-added services to customers as well as continuing investment in research and development to widen the range of products in order to enhance our competitiveness. With the commencement of production at the additional plants, the Group will begin consolidating internal resources in the second half of the year to optimize overall operating efficiencies.;

About Ngai Hing Hong Company Limited
Ngai Hing Hong provides a total solution to plastic products manufacturers with services and products ranging from plastic resin (including polymers and engineering plastics) selection, complementary computerised colour matching services, on the spot technical advice, to the supply of custom-made plastic colourants and engineering plastics for the plastic industry.