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C C LAND HOLDINGS LIMITED

中 渝 置 地 控 股 有 限 公 司g992
(Incorporated in Bermuda with limited liability)
Website: www.ccland.com.hk
(Stock Code: 1224)

ANNOUNCEMENT OF INTERIM RESULTS
FOR THE SIX MONTHS ENDED 30 JUNE 2007

The Board of Directors (the “Board”) of C C Land Holdings Limited (the “Company”) is pleased to
announce the unaudited consolidated results of the Company and its subsidiaries (collectively the
“Group”) for the six months ended 30 June 2007 together with comparative figures for the
corresponding period in 2006 as follows:

CONSOLIDATED INCOME STATEMENT

Six months ended 30 June
2007 2006

Notes HK$'000 HK$'000
(Unaudited) (Unaudited)

REVENUE 3, 4 459,984 391,558

Cost of sales (382,477) (326,353)

Gross profit 77,507 65,205

Other income and gains 4 100,546 16,734
Selling and distribution costs (11,838) (8,585)
Administrative expenses (47,867) (24,312)
Other expenses (26,170) (2,341)
Finance costs (8,278) (1,230)
Share of losses of associates (712) (1,812)
Share of loss of a jointly-controlled entity (2,530) -

PROFIT BEFORE TAX 5 80,658 43,659

Tax 6 495,160 (6,811)

PROFIT FOR THE PERIOD 575,818 36,848



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Attributable to:
Equity holders of the parent 572,990 37,518
Minority interests 2,828 (670)
575,818 36,848

EARNINGS PER SHARE ATTRIBUTABLE TO
ORDINARY EQUITY HOLDERS OF THE
PARENT

8

Basic 31.74HK cents 9.50HK cents

Diluted 31.73HK cents N/A

CONSOLIDATED BALANCE SHEET

30 June 31 December
2007 2006

Notes HK$'000 HK$'000
(Unaudited) (Audited)
NON-CURRENT ASSETS

Property, plant and equipment 274,928 267,654
Investment properties 178,851 128,262
Prepaid lease payments 25,283 25,510
Goodwill 43,521 35,139
Interests in associates 32,588 33,300
Interest in a jointly-controlled entity 93,656 -
Convertible note receivable - loan portion 31,827 30,983
Available-for-sale equity investments 48,028 46,612
Properties under development 6,559,353 6,424,561
Total non-current assets 7,288,035 6,992,021

CURRENT ASSETS

Properties under development held for sale 353,377 82,689
Land development rights 184,707 -
Completed properties for sale 7,628 1,365
Prepaid lease payments 655 639
Inventories 83,966 90,463
Trade receivables 9 220,965 117,519
Prepayments, deposits and other receivables 152,162 79,565
Equity investments at fair value through profit or loss 95,697 40,581
Conversion option derivative 3,693 1,743
Loans to associates 3,000 8,976
Tax recoverable 315 2,486
Due from a joint venture partner - 39,676
Deposits with brokerage companies 662 344
Pledged time deposits 55,721 160,756
Cash and cash equivalents 535,653 1,151,788
Total current assets 1,698,201 1,778,590

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30 June 31 December
2007 2006

Notes HK$'000 HK$'000
(Unaudited) (Audited)

CURRENT LIABILITIES

Trade and bills payables 10 207,504 133,837
Other payables and accruals 200,652 147,853
Loans from minority shareholders of subsidiaries 23,394 8,000
Interest-bearing bank borrowings 452,272 591,689
Tax payable 22,480 22,015
Due to a related party 19,999 20,013
Consideration payable on acquisition of associates - 3,000
Consideration payable on acquisition of subsidiaries 114,000 255,000
Total current liabilities 1,040,301 1,181,407

NET CURRENT ASSETS 657,900 597,183

TOTAL ASSETS LESS CURRENT LIABILITIES 7,945,935 7,589,204

NON-CURRENT LIABILITIES

Interest-bearing bank borrowings 232,759 126,295
Deferred tax liabilities, net 1,588,494 2,029,474
Total non-current liabilities 1,821,253 2,155,769

Net assets 6,124,682 5,433,435

EQUITY

Equity attributable to equity holders of the parent
Issued capital 180,538 180,538
Reserves 5,885,339 5,155,951
Proposed dividend - 90,269

6,065,877 5,426,758

Minority interests 58,805 6,677

Total equity 6,124,682 5,433,435

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Notes:

1. BASIS OF PREPARATION

The unaudited interim condensed consolidated financial statements for the six months ended 30
June 2007 have been prepared in accordance with Hong Kong Accounting Standard (“HKAS”)
34 “Interim Financial Reporting” issued by the Hong Kong Institute of Certified Public
Accountants (“HKICPA”) and the applicable disclosure requirements of Appendix 16 of the
Rules Governing the Listing of Securities on

2. PRINCIPAL ACCOUNTING POLICIES

The interim condensed consolidated financial statements have been prepared under the historical
cost basis except for certain financial instruments and investment properties, which are measured
at fair values.

The accounting policies and the basis of preparation adopted in preparing these unaudited interim
condensed consolidated financial statements are consistent with those used in the preparation of
the Group’s annual financial statements for the year ended 31 December 2006, except as
described below.

In the current interim period, the Group has applied, for the first time, the following new
standard, amendment and Interpretations (the “new HKFRSs”) issued by the HKICPA, which are
effective for the Group’s financial periods beginning on or after 1 January 2007.

HKAS 1 (Amendment) Capital Disclosures
HKFRS 7 Financial Instruments: Disclosures
HK(IFRIC)-Int 7 Applying the Restatement Approach under HKAS 29 Financial
Reporting in Hyperinflationary Economies
HK(IFRIC)-Int 8 Scope of HKFRS 2
HK(IFRIC)-Int 9 Reassessment of Embedded Derivatives
HK(IFRIC)-Int 10 Interim Financial Reporting and Impairment

The adoption of these new HKFRSs had no material effect on the results of operations and
financial position of the Group for the current or prior accounting periods. Accordingly, no prior
period adjustment has been recognised.

The Group has not early applied the following new and revised standards and interpretations that
have been issued but are not yet effective, in the interim condensed consolidated financial
statements.

HKAS 23 (Revised) Borrowing Costs
HKFRS 8 Operation Segments
HK(IFRIC)-Int 11 HKFRS 2: Group and Treasury Share Transactions
HK(IFRIC)-Int 12 Service Concession Arrangements

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3. SEGMENT INFORMATION

Summary details of the business segments are as follows:

Sales of packaging products
segment
– Manufacture and trading of watch boxes, gift boxes,
spectacles cases, bags and pouches, display units and acrylic
products
Sales of travel bags segment – Manufacture and trading of soft luggages, travel bags,
backpacks and brief cases
Treasury investment segment – Investments in securities and convertible notes, and provision
of financial services
Property development and
investment segment
– Development and investment of properties located in the
Mainland China

Business segments
The following tables present revenue and profit information regarding the Group’s business
segments for the six months ended 30 June 2007 and 2006, respectively.

For the six months ended 30 June 2007 – unaudited

Sale of
packaging
products
Sale of
travel
bags
Treasury
investment
Property
development
and
investment Total
HK$'000 HK$'000 HK$'000 HK$'000 HK$'000

Segment revenue :
Sales to external customers 188,345 254,258 7,258 10,123 459,984

Segment results 17,169 12,159 29,206 59,414 117,948

Unallocated corporate expenses (35,706)
Unallocated corporate income 9,936
Share of losses of :
Associates (712)
A jointly-controlled entity (2,530) (2,530)
Finance costs (8,278)

Profit before tax 80,658
Tax 495,160

Profit for the period 575,818

For the six months ended 30 June 2006 – unaudited

Sale of
packaging
products
Sale of
travel
bags
Treasury
investment Total
HK$'000 HK$'000 HK$'000 HK$'000

Segment revenue :
Sales to external customers 151,900 221,677 17,981 391,558

Segment results 18,893 1,113 23,856 43,862

Unallocated corporate expenses (5,757)
Unallocated corporate income 8,692
Share of losses of associates (1,812)
Finance costs (1,326)

Profit before tax 43,659
Tax (6,811)

Profit for the period 36,848

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Geographical segments
The following table provides an analysis of the Group’s revenue by geographical market,
irrespective of the origin of the goods:

Six months ended 30 June
2007 2006

HK$'000 HK$'000
(Unaudited) (Unaudited)
North and South America 245,077 192,663
Europe 96,057 109,378
Hong Kong 67,083 64,668
PRC 24,111 -

Others 27,656 24,849
459,984 391,558

4. REVENUE, OTHER INCOME AND GAINS

An analysis of the Group’s revenue, other income and gains is as follows:

Six months ended 30 June
2007 2006

HK$'000 HK$'000
(Unaudited) (Unaudited)
Revenue
Sale of goods 442,603 373,577
Sale of properties 1,112 -
Gross rental income 7,205 -
Realised gain on derecognition of investments held for
trading

-

17,229

Gain on disposal of listed equity investments at fair value
through profit or loss

5,259

-
Dividend income from listed investments 1,529 673
Dividend income from unlisted investments 680 -
Imputed interest income from convertible note receivable 1,596 79
459,984 391,558

Other income and gains
Interest income on bank deposits 14,232 4,280
Fair value gains on investments at fair value through profit
or loss, net

11,421

5,168

Fair value gains on conversion option derivative 1,951 -
Gain arising from redemption of convertible note
receivable

-

1,333

Gain on disposal of property, plant and equipment 81 -
Gain on disposal of a subsidiary - 3,082
Write-back of impairment of trade receivables 1,858 -
Write-back of impairment of other receivables 50,866 -
Fair value gains on investment properties 16,531 1,330
Others 3,606 1,541
100,546 16,734

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5. PROFIT BEFORE TAX

The Group’s profit before tax is arrived at after charging:
Six months ended 30 June
2007 2006

HK$'000 HK$'000
(Unaudited) (Unaudited)

Cost of inventories sold 292,395 265,765
Cost of properties sold 1,514 -
Depreciation 7,689 5,062
Impairment of goodwill 587 1,900
Amortisation on prepaid lease payments 235 318
Employee benefits expense (including directors’
remuneration):

- Salaries, wages and pensions 20,242 14,607
- Equity settled option expenses 24,501 -

6. TAX

Hong Kong profits tax has been provided at the rate of 17.5% (2006: 17.5%) on the estimated
assessable profits arising in Hong Kong during the period. Taxes on profits assessable in
Mainland China have been calculated at the rates of tax prevailing in Mainland China, based on
existing legislation, interpretations and practices in respect thereof.
Six months ended 30 June
2007 2006

HK$'000 HK$'000
(Unaudited) (Unaudited)
Group:
Hong Kong
- Current 6,950 6,811
- Overprovision in prior period (1,480) -
5,470 6,811

Deferred (500,630) -
Total tax (credit)/charge for the period (495,160) 6,811

On 16 March 2007, the National People’s Congress approved the Corporate Income Tax Law of
the People’s Republic of China (the “New CIT Law”), which will be effective from 1 January
2008. Under the New CIT Law, the corporate income tax rate applicable to domestic companies
from 1 January 2008 will decrease from 33% to 25%. Accordingly, the corporate income tax rate
of the Group’s subsidiaries in Mainland China will decrease from 33% to 25% on 1 January 2008
and thereafter. This reduction in the income tax rate will directly reduce the Group’s effective tax
rate prospectively from 2008.

According to HKAS 12, deferred tax assets and deferred tax liabilities are measured at the tax
rates that are expected to apply to the period when the asset is realised or the liability is settled.
As a result, the change in the corporate income tax rate has increased tax credit of the current
period and decreased deferred tax liabilities, both by HK$506,271,143, for the six months ended
30 June 2007.

At the date of approval of these interim financial statements, detailed implementation and
administrative requirements relating to the New CIT Law have yet to be announced. These
detailed requirements include regulations concerning the computation of taxable income, as well
as specific preferential tax treatments and their related transitional provisions. The Group will
further evaluate the impact of the New CIT Law on its operating results and financial positions of
future periods as more detailed requirements are issued.

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7. DIVIDENDS

During the six months ended 30 June 2007, a final dividend of HK$0.05 per share for 2006,
amounting to approximately HK$90,269,000 (2006: HK$0.06 per share for 2005, amounting to
approximately HK$23,637,000) was declared and paid to the shareholders. The directors do
not recommend the payment of any interim dividend for the six months ended 30 June 2007
(2006: Nil).

8. EARNINGS PER SHARE ATTRIBUTABLE TO ORDINARY EQUITY HOLDERS OF THE
PARENT

The calculation of the basic earnings per share for the six months ended 30 June 2007 is based on
the unaudited consolidated net profit from ordinary activities attributable to equity holders of the
parent of HK$572,990,000 (2006: HK$37,518,000) and the weighted average of 1,805,382,258
(2006: 393,953,687) ordinary shares in issue during the periods.

The comparative amounts have been restated to reflect the consolidation of the Company’s
shares on 11 January 2007, where every ten shares of the Company of HK$0.01 each were
consolidated into one share of HK$0.10 each.

The calculation of diluted earnings per share amounts is based on the profit for the six months
ended 30 June 2007 attributable to ordinary equity holders of the parent. The weighted average
number of ordinary shares used in the calculation is the total of the number of ordinary shares in
issue during the period of 1,805,382,258, as used in the basic earnings per share calculation, and
the weighted average number of ordinary shares assumed to have been issued at no consideration
of 729,145 on the deemed exercise of all dilutive potential ordinary shares into ordinary shares.

A diluted earning per share amount for the six months ended 30 June 2006 has not been disclosed
as no diluting events existed during that period.

9. TRADE RECEIVABLES

An aged analysis of the trade receivables as at the balance sheet date, based on the invoice date
and net of provisions, is as follows:

30 June 31 December
2007 2006

HK$'000 HK$'000
(Unaudited) (Audited)
Within 1 month 115,558 68,531
1 to 2 months 47,513 26,528
2 to 3 months 31,047 15,327
Over 3 months 26,847 7,133
220,965 117,519

The Group allows an average credit period of less than 90 days to its trade customers.

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10. TRADE AND BILLS PAYABLES

An aged analysis of the trade and bills payables as at the balance sheet date, based on the invoice
date, is as follows:

30 June 31 December
2007 2006

HK$'000 HK$'000
(Unaudited) (Audited)
Within 1 month 74,234 55,788
1 to 2 months 55,540 40,748
2 to 3 months 31,319 12,330
Over 3 months 46,411 24,971
207,504 133,837

The trade payables are non-interest-bearing and are normally settled on 60-day terms.

MANAGEMENT DISCUSSION AND ANALYSIS

BUSINESS REVIEW

During the period under review, the principal activities of the Group are PRC property development
and investment, manufacture and sale of packaging products and soft luggage, and treasury
investments. Revenue and profit attributable to shareholders for the Group increased by 17.5% to
HK$460.0 million (six months ended 30 June 2006: HK$391.6 million) and 1,428.0% to HK$573.0
million (six months ended 30 June 2006: HK$37.5 million). The revenue of the PRC property business,
packaging business, luggage business and other businesses are HK$10.1 million, HK$188.3 million,
HK$254.3 million and HK$7.3 million respectively.

The substantial increase in profit attributable to shareholders was mainly due to the contribution from
the PRC property development and investment business. Other income recorded in the period included
the recovery of receivables and fair value gain on investment properties to a total amount of HK$69.3
million (six months ended 30 June 2006: HK$1.3 million). The Corporate Income Tax Law approved
by the National People’s Congress on 16 March 2007 will become effective from 1 January 2008. The
corporate income tax rate applicable to the Group’s subsidiaries in China will then decrease from 33%
to 25%. As a result, a tax credit of HK$506.3 million in respect of deferred tax liabilities was recorded
in the period.

The packaging business contributed HK$16.7 million to profits (including a share of loss from an
associate of HK$0.7 million). The luggage business has turned around from a loss of HK$0.6 million
in the same period last year to produce a profit of HK$3.6 million in the current period.

Other expenses of HK$26.2 million (six months ended 30 June 2006: HK$2.3 million) was recorded,
in accordance with the Hong Kong Financial Reporting Standards, for an equity-settled share option
expense in the amount of HK$24.5 million (six months ended 30 June 2006: Nil) in respect of share
options granted to certain directors and eligible employees of the Group. The increases in selling and
distribution costs, administrative expenses, and finance costs were attributable to the inclusion of the
property business acquired in late 2006.

Earnings per share for the period was 31.74 HK cents (six months ended 30 June 2006: 9.5 HK cents
after adjustment to reflect the consolidation of the Company’s shares on 11 January 2007) and diluted
earnings per share was 31.73 HK cents (six months ended 30 June 2006: Nil).

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PRC PROPERTY AND INVESTMENT BUSINESS

According to the preliminary estimation by the National Bureau of Statistics of China, the gross
domestic product (“GDP”) of China in the first half of 2007 was RMB10,677 billion, an year-on-year
increase of 11.5%, which was 0.5% above the growth rate in the corresponding period last year. The
total investment in real estates development in the first half of 2007 was RMB989 billion, up by
28.5% from the same period last year, in which investment in residential properties reached RMB696
billion, an increase of 30.8%. All these figures show that the growing Chinese economy has
maintained a steady growth rate, especially in the real estate market.

Over the past year, the central government has adopted a series of macro-control policies to maintain
China's economic growth at a steady and sustainable level. Certain policies relevant to the real estate
market to address the issue of escalation of property prices included raising bank lending rates, tightening
control over execution of land appreciation tax and imposing value-added tax on the gain from disposal of
properties by foreign investors, were announced. The Group believes the implementation of such
macro-control policies are essential to the continued development of a healthy real estate market in China
in the long run.

In June 2007, both Chongqing and Chengdu were awarded the status of “Comprehensive Reform Trial
Zones District”. By expediting the urban-rural integration and building of modernized rural areas, the
economic growth of these two cities is expected to be more than robust. Both GDPs of Chongqing and
Chengdu in the first half of 2007 increased by 14.5% and 14.4% respectively which are higher than
the average GDP for the country. The directors believe that the real estates markets in Chongqing and
Chengdu will see some of the most rapid growth in the mainland in the coming years. The demand for
residential properties will further increase and property prices will continue to rise. The Group will
expand its land banks and is targeting to become a leading property developer in Western China.

Property Development and Sales Performance

In line with the Group’s strategy to develop properties for the middle and high end markets, most of
the property projects are residential properties for sale. The Group expects that a total GFA of about
5.5 million sq. m. will be completed by 2010, out of which 150,000 sq. m. are up for presale in 2007.

The sales of the California One Project, beginning in March 2007 was excellent. So far, 419 apartment
units out of the 474 available have been sold. The project comprises of apartments, hotel and office
with a total GFA of about 52,000 sq. m. and is expected to be completed in the first half of 2008.

The first two blocks of the first phase of the No.1 Peak Road Project (part of a mega-residential
complex of 969,020 sq. m.) which includes 383 residential units with a total GFA of about 38,800 sq.
m. is expected to be launched to the market for presale in September 2007. The first phase has 755
high-end residential units with a total GFA of about 77,700 sq. m. and car parking spaces of about
20,600 sq. m..

As at 7 September 2007, details of projects held under development are as follows:

Locations/Land Lot Nos.
Expected
Completion Date GFA (sq. m.)
The Group’s
Interests

Chongqing, Yubei District
- 15,16,17-1 end 2008-2009 969,020 100.0%
- 9 mid 2010 364,433 100.0%
- 10-1 mid 2009 349,962 100.0%
- 6-1 end 2008-2009 84,747 100.0%
- 19 mid 2010 382,770 100.0%
- 4 mid 2010 596,374 100.0%
- 35 mid 2010 266,686 100.0%
- 3-1 mid 2010 301,288 100.0%

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- Longta No. 3 and Longta No. 4 She,
Longxi Street Zone # end 2009 338,806 100.0%
- Others 2008-2009 162,509 100.0%

Chongqing, Jiangbei District
- Huaxin Street, Jie Dao Qiao Bei
Village and No.1 Zhongxin Section after 2010 1,029,879 25.0%

Chengdu, Wenjiang District
- 12/1/65 mid 2008-2009 555,000 50.0%

Chengdu, Dujiangyan District early 2009 61,000 100.0%

Sichuan, Pengshan County
- Binjiang New Town end 2009-2010 1,000,005 60.0%

Kunming, Gaoxin District
- R-1-7 end 2009 25,864 70.0%
- R-1-10 end 2009 36,582 70.0%

Total 6,524,925

# Pending approval from the authorities for completion. <refer to ‘Post Balance Sheet Events – point
5’ below>

Land Development

In February 2007, the Group acquired a 60% equity interest in a project company at a consideration of
HK$171 million. The project company owns the land development rights for two land tracts in
Dujiangyan, Chengdu, with a total site area of approximately 902,000 sq. m.. The land development
entails layout works and tenants relocation issues for the land tracts to bring them to a condition ready
for sale in land auctions. The Group will share the profit from the auctions according to
pre-determined profit sharing ratios as stipulated in the contract with the local PRC authority. The
Group took part in the first of a series of auctions for these land tracts, and succeeded in securing the
first available lot of 61,217 sq. m. at a price of RMB106.5 million. The Group will participate in the
subsequent auctions for the remaining land lots.

Investment Property

Retaining premium properties which have excellent potential for capital appreciation as long term
investments and providing stable recurring income is another key to success for a property developer.
The Group will maintain a balanced portfolio of properties held for sale and investments. We believe
these would not only strengthen our recurring income base but also maximize returns to our
shareholders.

The total book value of the Group’s investment properties amounted to HK$178.9 million as at 30
June 2007, with a corresponding attributable GFA of 74,786 sq. m.. The portfolio comprises
properties of diversified usage: commercial (37.8%), residential (5.5%) and car parking spaces
(56.7%). The prime locations of the Group’s investment properties had resulted in the overall
occupancy rate standing at a high level of 74.8% and contributed a gross rental income of HK$7.2
million for the six months ended 30 June 2007. From an appraisal conducted by an independent valuer,
the investment properties contributed a revaluation gain of HK$16.5 million during the period under
review.

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A summary breakdown of the investment properties is shown below:

Property Location Usage Attributable
GFA (sq. m.)
Occupancy
Rate
The Group’s
Interest

California Garden,
Longxi Town, Yubei
District, Chongqing,
PRC

Commercial
Residential
Car parking spaces
22,060
4,118
15,646

52.6%
12.9%
100.0%

100%
100%
100%

California City
Garden, Longxi
Town, Yubei District,
Chongqing, PRC
Commercial
Car parking spaces
4,685
12,094

28.4%
100.0%

100%
100%

Kechuang Building,
Longxi Town, Yubei
District, Chongqing,
PRC

Car parking spaces 3,691 100.0%

100%

Huijingtai, Longxi
Town, Yubei District,
Chongqing, PRC
Commercial
Car parking spaces
1,541
10,951

6.5%
100.0%

100%
100%

Total 74,786

Land Banks

Land banks are part of the key to success for a property developer. We started of by acquiring a main
land bank for our development plans in the Yubei District of Chongqing through the acquisition of
Chongqing Zhongyu Property Development Co. Ltd. (“Chongqing Zhongyu”) in November 2006.

In January 2007, the Group acquired a 50% equity interest in a property company in Wenjiang,
Chengdu, at a consideration of HK$96 million (HK$346 per sq. m. GFA). The land held under the
property company has a total site area of approximately 369,960 sq. m. with a plot ratio of 1.5 and is
earmarked for an upmarket residential development project with a total GFA of approximately
555,000 sq. m., in which the Group’s attributable interest is 277,500 sq. m.. Wenjiang is located in the
suburban western side of Chengdu, about 16 km. from the city center.

In May 2007, the Group expanded its land bank portfolio to Yunnan, another important city in
Western China, by successfully acquiring, through auction, a 70% interest in a land lot in the Gaoxin
District, Kunming, with a site area of approximately 18,660 sq. m. at a price of RMB86 million. The
development of this project is now in progress. Presales will start in the first half of 2008.

On 15 July 2007, the Group acquired a 60% equity interest in a company for a consideration of
RMB45 million. The company owns a land bank in the Pengshan County, south of Chengdu, which is
zoned for residential development with a total site area of approximately 333,335 sq. m. and a total
GFA of approximately 1,000,005 sq. m..

On 17 August 2007, the Group entered into a memorandum of agreement in relation to a joint venture
with two other Hong Kong property developers, for the development of a piece of land in Chongqing.
The land was acquired at a land auction at a land premium of RMB4.18 billion, of which the Group
has 25% interest. The land is located along the north bank of the Jialing River, and 2 km. away from
the Jiangbei Central Business District. The land has an area of approximately 205,086 sq. m. with a
GFA 1,029,879 sq. m. and is zoned for the development of residential/commercial projects.

On 3 September 2007, the Group successfully acquired through auction a site in Dujiangyan, Chengdu,
at a consideration of RMB106.5 million. This site is from the one of the land tracts over which the

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Group has land development right. The newly acquired land is a residential site occupying a site area
of 61,217 sq. m. and has a plot ratio of 1. The land will be developed into a low-density townhouse
project, targeting the mid to high-end market and is expected to be launched for presale in late 2008.

On 5 September 2007, the Group entered into an agreement to acquire the entire equity interest in a
property company in Chongqing at a consideration of RMB660 million. The acquisition is subject to
the granting of a new business licence to the Group by the government authorities. The company owns
a piece of land in the Yubei District of Chongqing with a net area of 146,825 sq. m. for building
purposes, yielding a buildable GFA of approximately 338,806 sq. m..

The Group will continue its efforts to expand its land banks with good development potentials by
merger, and acquisition through private treaties, tenders, and auctions.

As of 7 September 2007, the Group’s total land bank stood at 6,624,992 sq. m.. The Group’s land bank
comprises a well-diversified portfolio of properties. The breakdown by usage is as follows:

Usage
Completed
Properties
held for
Investment

Properties
held for
Own Use
Completed
Properties
held for
Sales

Land
Future

held for
Development

Total
GFA (sq. m.) GFA (sq. m.) GFA (sq. m.) GFA (sq. m.) GFA (sq. m.)
Total Attributable

Commercial 28,286 9,128 572,229 564,469 609,643
Residential 4,118 2,311 4,984,706 3,523,821 4,991,135
Office 339,131 339,131 339,131
Hotel & Serviced apartment 63,753 63,753 63,753
Townhouse & villa 22,630 22,630 22,630
Others (Car parking spaces &
other auxiliary facilities) 42,382 13,842 542,476 542,476 598,700

Total 74,786 22,970 2,311 6,524,925 5,056,280 6,624,992

The breakdown of the land bank for development by location is as follows:

Total Attributable
Location GFA (sq. m.) GFA (sq. m.) Percentage

Chongqing 4,846,474 4,074,065 74.3

Sichuan
- Chengdu 616,000 338,500 9.4
- Pengshan 1,000,005 600,003 15.3

Yunnan
- Kunming 62,446 43,712 1.0

Total 6,524,925 5,056,280 100.0

MANUFACTURING BUSINESS

Packaging Business

The packaging business continued to report robust performance for the first half of 2007. Sales
revenue and gross profit in the packaging business increased by 24.0% and 15.6% to HK$188.3
million and HK$37.1 million respectively (six months ended 30 June 2006: HK$151.9 million and
HK$32.1 million respectively). This was primarily attributable to the growth in economy in the
Group’s major markets, and to contributions delivered by vertical expansion into acrylic display items
and point of sales display products.

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The vertical integration was the result of acquisition of a 51% equity interest in a company in April
2007. This expansion is able to complement the existing product lines, providing opportunities for
further growth.

Whilst the result of the packaging business showed satisfactorily growth for the period, it appears that
fluctuations in raw material prices, and increases in labour and operating costs as a result of the
appreciation of the RMB will continue. In order to counter the increases in operating costs and to
improve profit margins, the packaging business will focus on enhancing productivity and efficiency in
its manufacturing processes.

Luggage Business

There was strong growth for the luggage business during the first six months of 2007 despite fierce
competition. Revenue grew by 14.7% to HK$254.3 million (six months ended 30 June 2006:
HK$221.7 million) and recorded a net profit of HK$5.9 million (six months ended 30 June 2006: net
loss of HK$1.3 million).

The Group expects stiff market competition to continue in the second half of 2007. The management
will streamline productivity and seek to diversify its customers base, including exposure to the PRC
market.

Other Businesses

Turnover of the treasury investment for the period amounted to HK$7.3 million (six months ended 30
June 2006: HK$18.0 million), and recorded a profit of HK$19.2 million (six months ended 30 June
2006: HK$20.1 million). A substantial portion of the reported profits represented unrealized holding
gain of securities of HK$11.4 million (six months ended 30 June 2006: HK$5.2 million), and gain on
disposal of securities of HK$4.1 million (six months ended 30 June 2006: HK$17.2 million).

The share of loss from the 30% owned associated company, Technical International Holdings Limited,
amounted to HK$0.7 million (six months ended 30 June 2006: HK$1.8 million). This is in line with
the seasonal trade nature of its business, which historically attains higher turnovers and profits in the
second half year.

PROSPECTS

PRC Property Development and Investment Business

Upon the acquisition of Chongqing Zhongyu in November 2006, the Company extended its business
into the China property markets. This opens an advantageous business channel and sets up a broader
platform for the Group to capitalise on the booming China economy. The outlook for China’s real
estate market is promising, resting on the continued robust growth in economy, the accelerating rate of
urbanization, and the increasing income per capita of the Chinese population. The Group will look to
expand its land banks through auctions, tenders, mergers, and acquisitions.

Manufacturing Business

The outlook for this year is favorable notwithstanding the adverse effects of increasing operating costs
and appreciation of the Renminbi. The Group is optimistic that the business opportunities in the
packaging business, the core manufacturing business of the Group, will remain buoyant given the
steady economic growth overseas.

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FINANCIAL REVIEW

Liquidity and Financial Resources

As at 30 June 2007, the Group’s bank and cash balances amounted to HK$591.4 million (31 December
2006: HK$1,312.5 million) and had bank borrowings of about HK$685.0 million (31 December 2006:
HK$718.0 million), of which HK$452.3 million (31 December 2006: HK$591.7 million) are due
within one year. The respective bank borrowings for the manufacturing and property arms amounted to
HK$46.9 million and HK$638.1 million respectively. The total equity at that date stood at HK$6,124.7
million (31 December 2006: HK$5,433.4 million). The gearing ratio, calculated as total borrowings
over total equity, was 11.2% (31 December 2006: 13.2%).

Taking into account the financial resources available to the Group, the Group has sufficient working
capital to finance its operation. The rise in finance costs for the period to HK$8.3 million (six months
ended 30 June 2006: HK$1.2 million as restated) was attributable to borrowings financing the
subsidiary’s property development projects.

Working Capital

The Group had current assets amounting to HK$1,698.2 million (31 December 2006: HK$1,778.6
million) while current liabilities stood at HK$1,040.3 million (31 December 2006: HK$1,181.4
million). The Group’s liquidity is in a healthy position with a current ratio of 1.6 (31 December 2006:
1.5).

Investments

At 30 June 2007, the Group held a portfolio of listed securities with a market value of HK$95.7
million (31 December 2006: HK$40.6 million) and a convertible note of HK$35.5 million (31
December 2006: HK$32.7 million) issued by a company listed on The Stock Exchange of Hong Kong
Limited. The amount of dividend, interest and other income from investments for the period was
HK$5.8 million (six months ended 30 June 2006: HK$0.7 million). The unrealized holding gain on
listed securities reflected in the current period amounted to HK$11.4 million (six months ended 30
June 2006: HK$5.2 million). The Group’s PRC subsidiary has investments in equity securities
amounting to HK$48.0 million (31 December 2006: HK$46.6 million) held for long term purposes.

Capital Expenditure

Since diversification into the PRC property business, the Group had executed land and land
development right acquisitions for the six months ended 30 June 2007 amounting to HK$355 million.
These acquisitions were entirely financed by internal resources.

Contingent Liabilities

At 30 June 2007, the Group had the following contingent liabilities:

a. Guarantees given to banks in connection with facilities granted to an associated company to the
amount of HK$13.5 million (31 December 2006: HK$12.0 million).

b. Guarantees in respect of the mortgage facilities granted by certain banks to certain purchasers of
the Group’s properties to the amount of HK$30.6 million (31 December 2006: HK$29.7 million).

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Pledge of Assets

At 30 June 2007, the Group has pledged the followings:

a. Leasehold properties as security for general banking facilities
granted to the Group

HK$6.1 million
b. Fixed deposits as security for general banking facilities granted to a
subsidiary

HK$3.1 million
c. A piece of land and the building erected thereon where a subsidiary's
production facility is located as security for revolving credit bank
facilities granted to the subsidiary

HK$25.6 million
d. Properties under development and investment properties pledged to
secure banking facilities granted to a PRC subsidiary

RMB3,111.9 million
e. Time deposits as security for short term bank borrowings granted to
a PRC subsidiary (for its property business)
USD5.6 million

Exchange Risks

Sales and purchase transactions of the Group’s manufacturing business are primarily conducted in US
dollars, Hong Kong dollars and/or Renminbi, while transactions for the property business are
denominated in Renminbi. The exposure to foreign exchange risk is thus minimal.

EMPLOYEES

At 30 June 2007, the Group had approximately 6,701 employees. The Group remunerates its staff
based on their merit, qualification and competence. The Group has also established an incentive bonus
scheme, in which the benefits are determined based on the performance of the individual employees.
Employees are eligible to be granted share options under the Company's share option scheme at the
discretion of the Board. Other benefits include contribution to a provident fund scheme or mandatory
provident fund, and medical insurance.

During the period, options to subscribe for 15 million shares in total at exercise prices of HK$4.81,
HK$5.26 and HK$5.37 per share were granted on even dates under the share option scheme to certain
directors and eligible employees of the Group. Total fair value of these share options granted was
approximately HK$33.5 million. An amount of HK$24.5 million was charged as equity-settled share
option expense to the income statement for the period ended 30 June 2007.

Post Balance Sheet Events

The following events took place subsequent to 30 June 2007:

1. On 15 July 2007, the Group acquired a 60% equity interest in a company for a consideration of
RMB45 million. The company owns a land bank for residential development with a total site area
of approximately 333,335 sq. m. and a total GFA of approximately 1,000,005 sq. m. in Pengshan
County, Sichuan Province.

2. On 24 July 2007, the Group placed 360 million new shares to independent investors at a price of
HK$8.10 per share, raising approximately HK$2,862 million to finance the property business
expansion, acquisition of land bank, and for general working capital.

3. On 8 August 2007, options were granted to certain directors and eligible employees of the Group
to subscribe for a total of 12.9 million shares at an exercise price of HK$8.73 per share.

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4. On 17 August 2007, the Group entered into a memorandum of agreement in relation to a joint
venture with two Hong Kong property developers for the development of a piece of land in
Chongqing, the PRC. The land was acquired at auction at a land premium of RMB4.18 billion, of
which the Group has a 25% interest. The land site is approximately 205,086 sq. m. with a GFA of
1,029,879 sq. m. and is zoned for development of residential/commercial projects.

5. On 5 September 2007, the Group entered into an agreement to acquire the entire equity interest in
a property company in Chongqing at a consideration of RMB660 million. The acquisition is
subject to the granting of a new business licence to the Group by government authorities. The
company owns a piece of land in the Yubei District of Chongqing with a net area of 146,825 sq. m.
for building purposes, yielding a buildable GFA of approximately 338,806 sq. m..

INTERIM DIVIDEND

The directors do not recommend the payment of any interim dividend for the six months ended 30
June 2007 (six months ended 30 June 2006: Nil).

CORPORATE GOVERNANCE

The Company has complied with the code provisions as set out in the Code on Corporate Governance
Practices (the “Code”) contained in Appendix 14 of the Rules Governing the Listing of Securities on
The Stock Exchange of Hong Kong Limited (the “Listing Rules”) throughout the six months ended 30
June 2007, except for the following deviation:

Code Provision A.4.1 stipulates that non-executive directors should be appointed for a specific term,
subject for re-election. None of the existing non-executive directors are appointed for a specific term.
However, all the non-executive directors shall be subject to retirement by rotation at the annual
general meetings at least once every three years pursuant to the Company’s Bye-laws. As such, the
Board considers that sufficient measures have been taken to ensure that the Company’s corporate
governance practices are no less exacting than those in the Code.

Following the resignation of Mr. Wong Wai Kwong David on 26 July 2007 as independent
non-executive director, audit committee member and remuneration committee member of the
Company, the number and qualification of independent non-executive director of the Company fail to
meet the requirements under rule 3.10 of the Listing Rules and the composition of the Company’s
audit committee fails to meet the requirement under rule 3.21 of the Listing Rules, and a majority of
members of the remuneration committee has temporarily not been formed by independent
non-executive directors. As such, the Board would make its best endeavors to identify an appropriate
person for appointment as the independent non-executive director, audit committee member and
remuneration committee member of the Company within three months from the date of his
resignation.

AUDIT COMMITTEE

The Audit Committee has discussed with the management and external auditors the accounting
principles and policies adopted by the Group, and has reviewed the Group’s unaudited interim
financial statements for the six months ended 30 June 2007.

MODEL CODE FOR SECURITIES TRANSACTIONS BY DIRECTORS

The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers
(the “Model Code”) set out in Appendix 10 of the Listing Rules as its own code of conduct regarding
securities transactions by the directors. Following specific enquiry by the Company, all directors
have confirmed that they have complied with the required standard set out in the Model Code
throughout the six months ended 30 June 2007.

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PURCHASE, SALE OR REDEMPTION OF THE COMPANY’S LISTED SECURITIES

During the six months ended 30 June 2007, neither the Company nor any of its subsidiaries purchased,
sold or redeemed any of the Company’s listed securities.

By order of the Board
Lam How Mun Peter
Deputy Chairman and Managing Director

Hong Kong, 21 September 2007

As at the date of this announcement, the Board comprises Mr. Cheung Chung Kiu, Dr. Lam How Mun
Peter, Mr. Lam Hiu Lo, Mr. Leung Chun Cheong, Mr. Leung Wai Fai, Ms. Poon Ho Yee Agnes, Mr.
Tsang Wai Choi and Mr. Wu Hong Cho as Executive Directors and Mr. Lam Kin Fung Jeffrey and Mr.
Wong Yat Fai as Independent Non-executive Directors.