(Hong Kong, October 13, 2005) -- Leading Hong Kong plastic resins and specialty colourants supplier Ngai Hing Hong Company Limited (the ¡§Company¡¨) and its subsidiaries (the ¡§Group¡¨) (Stock code: 1047) today announced its annual results for the year ended June 30, 2005.

For the year under review, the Group recorded a turnover of HK$1,243,849,000 (2004: HK$1,017,775,000), representing a growth of 22.2% over that of the corresponding period last year. Profit attributable to shareholders amounted to HK$17,102,000 (2004: HK$13,279,000). Earnings per share for the period amounted to HK5.64 cents (2004: HK 4.43 cents). The Board has recommended an annual dividend of HK1.0 cent per share (2004: HK 2.0 cents). Including the interim dividend of HK1.0 cent per share, the total dividend payment for the year under review will amount to HK2.0 cents (2004: HK 3.0 cents) per share. The dividend payment was lower than the corresponding period of 2003/2004 because the Board has resolved to retain sufficient cash for its future development projects so as to bring better returns for the shareholders in the future.

Mr. Hui Sai Chung, Chairman of Ngai Hing Hong, said, ¡§The past year has proven to be a challenging year to the Group. In face of the rise in material costs triggered by the persistently high crude oil prices, the Group managed to adopt proper strategies to cope with the challenges and turned these unfavourable conditions into opportunities, reaching double-digit growth in both turnover and net profit.¡¨

During the year, the Group adopted proactive sales and marketing strategies and was able to expand the client base, resulted in gains in both order numbers and product selling prices. Besides, in 2003/ 2004, the Group successfully established new PVC compounds business and set up a production plant in Dongguan to produce PVC compounds for making electrical wires and cables, sockets and toys. Owing to the concerted dedication of the Group¡¦s sales team, the segment has been generating new clients and orders. The Group expects the segment to create return in the next fiscal year and become a major growth engine in the future.

There were encouraging results in the Group¡¦s plastic trading business, with strong growth in both turnover and profit. The rise in plastic resins prices, relentless efforts of the Company¡¦s sales teams and the gradual opening of the domestic market are recognized as the growth momentum. Furthermore, the Group also saw the growth of Ngai Hing (GZFTZ) Trading Co., Ltd. and its contribution to the Group¡¦s turnover.

In addition, the Group¡¦s engineering plastic business presented impressive results by delivering double-digit growth in both turnover and profit during the review period. This segment stepped up to collaborate with customers¡¦ research and development (R&D) teams in introducing new products and displayed remarkable contribution to the growth of the Group¡¦s profit. With regard to the colourants business, the rise in raw material prices and production cost had imposed negative impact to its order inflow and hence affected the growth of the segment.

Fluctuation in crude oil prices continues to pose uncertainties in global economy. Although there is improvement in consumers¡¦ consumption sentiment in markets, the Group remains cautiously optimistic of its business outlook. In view of the challenging business environment, the Group will endeavor to widen its client base, trim down production costs, and develop new products and new product applications. The Group is confident that its exceptional production efficiency and economies of scale will bring ultimate satisfaction to customers.

Furthermore, the Group will commit to developing PRC market for its engineering plastic business, focusing specially on the fast growing eastern region and continue to collaborate with the customers¡¦ R&D effort in rolling out new products for the market. As for the colourants segment, the Group will closely follow the global market development and proactively explore overseas market, including, the U.S., Europe, Asian and Middle East in the long run for its products.

Mr. Hui concluded, ¡§Adhering to these clear and focused growth strategies and with the concerted efforts and commitment of our staff, the Group will continue to strive for satisfactory results in the future so as to bring rewarding returns to our shareholders.¡¨

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

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